As filed with the Securities and Exchange Commission on March 15, 1995
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
RJR Nabisco Holdings Corp.
(Exact name of registrant as specified in its charter)
Delaware 13-3490602
(State or other (I.R.S. Employer
jurisdiction of Identification No.)
incorporation or
organization)
1301 Avenue of the Americas
New York, New York 10019
(212) 258-5600
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
Jo-Ann Ford, Esq.
Senior Vice President, Law and Secretary
RJR Nabisco Holdings Corp.
1301 Avenue of the Americas
New York, New York 10019
(212) 258-5600
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Copies to:
Jeffrey Small, Esq. Charles I. Cogut, Esq.
Davis Polk & Wardwell Simpson Thacher & Bartlett
450 Lexington Avenue 425 Lexington Avenue
New York, New York New York, New York 10017
10017 (212) 455-2000
(212) 450-4000
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement as determined by
market conditions.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box.
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box.
CALCULATION OF REGISTRATION FEE
<TABLE><CAPTION>
Proposed
Title of each class of Proposed maximum Maximum Amount of
securities Amount to be offering price aggregate registration
to be registered registered per share(1) offering price fee
<S> <C> <C> <C> <C>
Common Stock, par value
$.01 per share . . . . . . . 111,047,230 shares $ 5.75 $638,521,572.50 $ 220,181.39
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) on the basis of the average of the high
and low reported sales prices on March 8, 1995.
The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the registrant shall
file an amendment which specifically states that this registration statement
shall thereafter become effective in accordance with section 8(a) of the
Securities Act of 1933 or until the registration statement shall become
effective on such date as the Commission acting pursuant to said section 8(a),
may determine.
<PAGE>
Subject to Completion, Dated March 15, 1995
PROSPECTUS
Logo
111,047,230 Shares
RJR Nabisco Holdings Corp.
Common Stock
(par value $.01 per share)
________________
Borden, Inc. ("Borden" or the "Selling Stockholder") may offer from
time to time up to 111,047,230 shares of common stock, par value $.01
per share (the "Common Stock" or the "Holdings Common Stock"), of RJR
Nabisco Holdings Corp. (the "Company" or "Holdings"). When an
offering of all or part of the Common Stock offered hereby is made, a
supplement to this Prospectus (the "Prospectus Supplement") will be
delivered with this Prospectus. The Prospectus Supplement will set
forth the terms of the offering of the Common Stock, the initial
offering price and the net proceeds to the Selling Stockholder of the
sale thereof. Following the offering of all of the shares of Common
Stock which may be offered from time to time hereby, the Selling
Stockholder will not own or control any shares of Common Stock.
The Common Stock is traded on the New York Stock Exchange, Inc.
("NYSE") under the symbol "RN." A recent closing sale price of the
Common Stock on the NYSE will be set forth on the cover page of the
Prospectus Supplement.
See "Certain Significant Considerations" in the Prospectus
Supplement for a description of certain factors that should be
considered by purchasers of the Common Stock offered hereby.
________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
________________
The Common Stock offered hereby may be sold directly to purchasers or
through agents designated from time to time by the Selling
Stockholder or to or through one or more underwriters. If any agents
of the Selling Stockholder or any underwriters are involved in the
sale of Common Stock in respect of which this Prospectus is being
delivered, the names of such agents or underwriters and any
applicable commissions or discounts will be set forth in the
Prospectus Supplement.
________________
The date of this Prospectus
is March __, 1995
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. The prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there bed any sale of these
securities in any State in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such State.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). The reports, proxy
statements and other information filed by Holdings with the Commission can be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and
should be available at the Commission's Regional Offices at 7 World Trade
Center, 13th Floor, New York, New York 10048, and 500 West Madison Street, Suite
1400, Chicago, Illinois 60661. Copies of such material also can be obtained
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. In addition, material filed by
Holdings can be inspected at the offices of the New York Stock Exchange, Inc.,
20 Broad Street, New York, New York 10005.
This Prospectus constitutes a part of a Registration Statement filed by the
Company with the Commission under the Securities Act of 1933, as amended (the
"Securities Act"). This Prospectus omits certain of the information contained
in the Registration Statement in accordance with the rules and regulations of
the Commission. Reference is hereby made to the Registration Statement and
related exhibits for further information with respect to the Company and the
Common Stock. Statements contained herein concerning the provisions of any
document are not necessarily complete and, in each instance, reference is made
to the copy of such document filed as an exhibit to the Registration Statement
or otherwise filed with the Commission. Each such statement is qualified in its
entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by Holdings (File No.
1-10215) pursuant to the Exchange Act or the Securities Act, as applicable, are
incorporated by reference in this Prospectus:
1. Holdings' Annual Report on Form 10-K for the year ended December
31, 1994.
Each document filed by the Company pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the Common Stock pursuant hereto
shall be deemed to be incorporated by reference in this Prospectus and to be a
part of this Prospectus from the date of filing of such document. Any statement
contained in this Prospectus or in a document incorporated or deemed to be
incorporated by reference in this Prospectus shall be deemed to be modified or
superseded for purposes of the Registration Statement and this Prospectus to the
extent that a statement contained in this Prospectus or the Prospectus
Supplement, or in any subsequently filed document that also is or is deemed to
be incorporated by reference in this Prospectus, modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of the Registration
Statement or this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, upon the written or oral request of any such person, a
copy of any or all of the documents that are incorporated by reference in this
Prospectus, other than exhibits to such documents (unless such exhibits are
specifically incorporated by reference into such documents). Requests should be
directed to RJR Nabisco, Inc., 1301 Avenue of the Americas, New York, New York
10019 (telephone number (212) 258-5600), Attention: Investor Relations
Department.
2
<PAGE>
The Registration Statement is being filed by Holdings at the request
of one or more persons entitled to request the filing pursuant to the terms of a
Registration Rights Agreement among Holdings, certain affiliates of Kohlberg
Kravis Roberts & Co., L.P. ("KKR") and others dated as of February 9, 1989.
THE COMPANY
As used herein, "Holdings" or the "Company" means RJR Nabisco Holdings
Corp. and its consolidated subsidiaries unless the context otherwise requires.
RJR Nabisco Holdings Corp.
The operating subsidiaries of Holdings owned through RJR Nabisco, Inc.
("RJRN") comprise one of the largest tobacco and food companies in the world.
In the United States, the tobacco business is conducted by R.J. Reynolds Tobacco
Company ("RJRT"), the second largest manufacturer of cigarettes, and the
packaged foods business is conducted by Nabisco Holdings Corp. ("Nabisco
Holdings") through its wholly-owned subsidiary, Nabisco, Inc. ("Nabisco"), the
largest manufacturer and marketer of cookies and crackers. RJRN owns
approximately 80.5% of the economic interest and approximately 97.6% of the
voting power of Nabisco Holdings. Tobacco operations outside the United States
are conducted by R.J. Reynolds Tobacco International, Inc. ("Tobacco
International") and packaged food operations outside the United States
are conducted by Nabisco International, Inc. ("Nabisco International")
and Nabisco Brands Ltd ("Nabisco Brands"), subsidiaries of Nabisco. RJRT's and
Tobacco International's tobacco products are sold around the world under a
variety of brand names. Food products are sold in the United States, Canada,
Latin America and certain other international markets.
Tobacco
RJRT's largest selling cigarette brands in the United States include
WINSTON, DORAL, CAMEL, SALEM, MONARCH and VANTAGE. RJRT's other cigarette
brands, including MORE, NOW, BEST VALUE, STERLING, MAGNA and CENTURY, are
marketed to meet a variety of smoker preferences. All RJRT brands are marketed
in a variety of styles. Tobacco International operates in over 160 markets
around the world and is the second largest of two international cigarette
producers that have significant positions in the American Blend segment of the
international tobacco market.
Food
Nabisco's domestic operations represent one of the largest packaged food
businesses in the world. Through its domestic divisions, Nabisco manufactures
and markets cookies, crackers, snack foods, hard and bite-size candy, gum, nuts,
hot cereals, margarine, pet foods, dry-mix dessert products and other grocery
products under established and well-known trademarks, including OREO, CHIPS
AHOY!, NEWTONS, SNACKWELL'S, RITZ, PREMIUM, LIFE SAVERS, PLANTERS, A.1, GREY
POUPON, MILK-BONE, ORTEGA, CREAM OF WHEAT, FLEISCHMANN'S and BLUE BONNET.
Nabisco International is also a leading producer of powdered dessert and drink
mixes, biscuits, baking powder and other grocery items, industrial yeast and
bakery ingredients in many of the 17 Latin American countries in which it has
operations. Nabisco Brands conducts Nabisco's Canadian operations through a
biscuit division, a grocery division and a food service division. Excluding
private label brands, the biscuit division produced nine of the top ten cookies
and nine of the top ten crackers in Canada in 1994.
RJRN was acquired in 1989 by an indirect, wholly owned subsidiary of
Holdings at the direction of KKR. KKR is a private investment firm organized as
a Delaware limited partnership.
The principal executive office of Holdings is located at 1301 Avenue of
Americas, New York, New York 10019; its telephone number is (212) 258-5600.
3
<PAGE>
Recent Developments
On March 10, 1995, Nabisco filed with the Securities and Exchange
Commission a registration statement on Form S-4 (Registration No. 33-90224) (the
"Form S-4 Registration Statement") pursuant to which RJRN intends to offer to
exchange (the "Exchange Offers") up to $1,917,650,000 aggregate principal amount
of newly-issued notes and debentures (the "New Notes") of Nabisco for any and
all of the $1,917,650,000 aggregate principal amount of certain outstanding
notes and debentures issued by RJRN (the "Old Notes"). As part of the Exchange
Offers, RJRN is soliciting consents from holders of Old Notes to certain
proposed amendments to the indentures pursuant to which the Old Notes were
issued.
Concurrently with the Exchange Offers, RJRN also intends to solicit
consents from holders of $3,584,500,000 aggregate principal amount of
outstanding debt securities other than the Old Notes to certain proposed
amendments to the indentures pursuant to which such debt securities were issued
(the "Other Securities Consent Solicitations"). Fees will be paid to holders of
such other securities who consent to such amendments.
The Exchange Offers, the Other Securities Consent Solicitations and other
related transactions are designed, among other things, to enable Nabisco to
obtain long-term debt financing independent of RJRN and to reduce intercompany
debt.
The New Notes will initially be issued by Nabisco to RJRN in exchange for
a reduction of a portion of intercompany debt owed to RJRN. Nabisco expects to
use the proceeds of borrowings under its bank credit facilities to repay the
remainder of its intercompany debt. Such borrowings may be refinanced through
the issuance of intermediate-term notes. As a result of these transactions,
although the unconsolidated debt of RJRN will be substantially reduced and the
intercompany debt owed to RJRN will be eliminated, the consolidated debt of
RJRN will remain approximately the same as before the transactions.
Any New Notes issued pursuant to the Exchange Offers will be unsecured and
unsubordinated obligations of Nabisco and will rank pari passu with all existing
and future unsecured and unsubordinated indebtedness of Nabisco.
The Exchange Offers and Other Securities Consent Solicitations are subject
to a number of conditions, including the amendment or replacement of certain
credit agreements of RJRN and Nabisco. RJRN has reserved the right to terminate
the transactions contemplated by the Form S-4 Registration Statement, to waive
conditions to the consummation of such transactions and otherwise to modify the
terms of such transactions or of the Exchange Offers or the Other Securities
Consent Solicitations. Accordingly, no assurance can be given that such
transactions will be consummated or that they will consummated on the terms
described in the Form S-4 Registration Statement on file with the Commission
on the date hereof, which has not yet been declared effective by the Commission.
The Form S-4 Registration Statement has not been declared effective by the
Commission, and no offer or sale in respect of the securities proposed to be
registered thereunder will be made until such Form S-4 Registration Statement
becomes effective.
4
<PAGE>
Summary Historical Consolidated Financial Data
The summary consolidated financial data presented below as of December 31,
1994 and 1993 and for each of the years in the three-year period ended December
31, 1994 for Holdings were derived from the historical consolidated financial
statements of Holdings and notes thereto (the "Holdings Consolidated Financial
Statements"), incorporated herein by reference, which have been audited by
Deloitte & Touche LLP, independent auditors. In addition, the summary
consolidated financial data presented below as of December 31, 1992, 1991 and
1990 and for the years ended December 31, 1991 and 1990 were derived from the
audited consolidated financial statements of Holdings as of December 31, 1992,
1991 and 1990 and for the years ended December 31, 1991 and 1990, which are not
presented or incorporated by reference herein. The data presented below should
be read in conjunction with the Holdings Consolidated Financial Statements and
notes thereto incorporated herein by reference.
<TABLE><CAPTION>
For the Years Ended December 31,
--------------------------------------------------------------------
(Dollars in Millions Except Per
Share Amounts) 1994 1993 1992 1991 1990
----------- ----------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C>
Results of Operations
Net sales . . . . . . . . . . . $15,366 $15,104 $15,734 $14,989 $13,879
------- ------- ------- ------- -------
Cost of products sold . . . . . 6,977 6,640 6,326 6,088 5,652
Selling, advertising,
administrative and general
expenses . . . . . . . . . . 5,210 5,731 5,788 5,358 4,801
Amortization of trademarks and
goodwill . . . . . . . . . . 629 625 616 609 608
Restructuring expense . . . . . -- 730 106 -- --
------ ------ ------ ------ ------
Operating income(1) 2,550 1,378 2,898 2,934 2,818
Interest and debt expense . . . (1,065) (1,209) (1,449) (2,217) (3,176)
Other income (expense), net . . (110) (58) 7 (69) (44)
------ ------ ------ ------ ------
Income (loss) from
continuing operations
before income taxes . . . . 1,375 111 1,456 648 (402)
Provision (benefit) for income
taxes . . . . . . . . . . . . 611 114 680 280 60
------ ------ ------ ------ ------
Income (loss) from
continuing operations . . . 764 (3) 776 368 (462)
Extraordinary item--(loss) gain
on early extinguishments of
debt, net of income taxes . . (245) (142) (477) -- 33
------ ------ ------ ------ ------
Net income (loss) . . . . . . . 519 (145) 299 368 (429)
Preferred stock dividends . . . 131 68 31 173 50
------ ------ ------ ------ ------
Net income (loss) applicable
to common stock . . . . . . . $ 388 $ (213) $ 268 $ 195 $ (479)
====== ====== ====== ====== ======
Per Share Data
Income (loss) before
extraordinary item per
common and common equivalent
share(2) . . . . . . . . . . $ 0.41 $(0.05) $ 0.55 $ 0.22 $(1.19)
====== ====== ====== ====== ======
Pro forma income (loss) before
extraordinary item per
common and common equivalent
share(3) . . . . . . . . . . $ 2.06 $(0.26) $ 2.73 $ 1.10 $
(5.93)
====== ====== ====== ====== ======
Dividends per share of Series
A Preferred Stock(4) . . . . $2.92 $3.34 $3.34 $0.49 --
Dividends per share of Series
C Preferred Stock(4) . . . . 3.94 -- -- -- --
</TABLE>
5
<PAGE>
<TABLE>
<S> <C> <C> <C> <C> <C>
Balance Sheet Data
(at end of periods)
Working capital(5) . . . . . . $(1,231) $ 202 $ 730 $ 165 $(1,089)
Total assets . . . . . . . . . 31,408 31,295 32,041 32,131 32,915
Total debt(5) . . . . . . . . . 11,149 12,448 14,218 14,531 18,918
Redeemable preferred stock(6) . -- -- -- -- 1,795
Stockholders' equity(7) . . . . 10,908 9,070 8,376 8,419 2,494
</TABLE>
- ----------------
(1) The 1992 amount includes a gain of $98 million on the sale of the ready-to-
eat cold cereal business.
(2) The loss before extraordinary item per common and common equivalent share
reported for the year ended December 31, 1993 would have increased by $.17
per share if the weighted average number of shares of Series A Depositary
Shares (as defined below) outstanding during the period had been excluded
from the earnings per share calculation.
(3) Amounts reflect a one-for-five reverse split approved by the Board of
Directors of Holdings which will be submitted to Holdings' stockholders for
approval at its annual meeting in April 1995.
(4) On November 8, 1991, Holdings issued 52,500,000 shares of Series A
Conversion Preferred Stock, par value $.01 per share ("Series A Preferred
Stock"), and sold 210,000,000 $.835 depositary shares (the "Series A
Depositary Shares"), each of which represented one-quarter of a share of
Series A Preferred Stock. On May 6, 1994, Holdings issued 26,675,000 shares
of Series C Conversion Preferred Stock, par value $.01 per share (the
"Series C Preferred Stock"), and sold 266,750,000 Series C Depositary
Shares (the "Series C Depositary Shares"), each of which represented one-
tenth of a share of Series C Preferred Stock. On November 15, 1994, each
outstanding Series A Depositary Share converted into one share of Holdings
Common Stock.
(5) Working capital at December 31, 1994 included $1.35 billion of borrowings
under a credit agreement dated as of December 6, 1994 among Nabisco and the
lenders named therein, a substantial portion of which was used in
connection with the refinancing of certain debt. On January 26, 1995, such
borrowings were substantially reduced through the application of
approximately $1.2 billion of net proceeds received from the initial public
offering of 51,750,000 shares of Nabisco's Class A Common Stock.
(6) On December 16, 1991, an amendment to the Amended and Restated Certificate
of Incorporation of Holdings was filed which deleted the provisions
providing for the mandatory redemption of the redeemable preferred stock of
Holdings on November 1, 2015. Accordingly, such securities were presented
as a component of Holdings' stockholders' equity as of December 31, 1992
and 1991. Such securities were redeemed on December 6, 1993.
(7) Holdings' stockholders' equity at December 31 of each year from 1994 to
1990 includes non-cash expenses related to accumulated trademark and
goodwill amortization of $3.644 billion, $3.015 billion, $2.390 billion,
$1.774 billion and $1.165 billion, respectively.
See Notes to Holdings Consolidated Financial Statements
incorporated herein by reference.
6
<PAGE>
PRICE RANGE OF COMMON STOCK AND DIVIDENDS
The Common Stock is listed and principally traded on the NYSE (Symbol: RN).
The following table sets forth the high and low sales prices per share of the
Common Stock as reported on the NYSE Composite Tape.
Fiscal Year High Low
- ----------- ---- -----
1993
First Quarter . . . . . . . . . . . .. . $ 9 1/4 $ 7 5/8
Second Quarter . . . . . . . . . . .. . 8 1/8 5 1/8
Third Quarter . . . . . . . . . . . .. . 5 7/8 4 1/2
Fourth Quarter . . . . . . . . . . .. . 7 3/8 4 3/8
1994
First Quarter . . . . . . . . . . . .. . $ 8 1/8 $ 5 5/8
Second Quarter . . . . . . . . . . .. . 7 5 1/2
Third Quarter . . . . . . . . . . . .. . 7 1/8 5 5/8
Fourth Quarter . . . . . . . . . . .. . 7 1/4 5 5/16
1995
First Quarter (through
March 14, 1995) . . . . . . . . . .. . $ 5 $ 6
At January 31, 1995, there were 1,362,133,648 shares of Common Stock
outstanding held by approximately 65,000 stockholders of record. A recent
reported closing sale price on the NYSE for shares of the Common Stock will be
set forth on the cover page of the Prospectus Supplement.
The Board of Directors of Holdings has approved a one-for-five reverse
split of the Common Stock, which will be submitted to Holdings' stockholders for
approval at its annual meeting in April 1995. If approved, the reverse stock
split would result in a dividend and earnings per share that are five times
higher with a corresponding reduction in the number of shares outstanding.
Holdings has indicated that, under normal circumstances, it does not plan
to issue additional equity securities for purposes of balance sheet improvement.
The Board of Directors of the Company has declared the first regular
quarterly cash dividend on the Common Stock of $.075 per share, or $.30 per
share on an annualized basis. The dividend is payable April 1, 1995 to
stockholders of record on March 10, 1995.
In addition, Holdings has announced certain policies affecting dividends on
the Common Stock. One policy provides that Holdings will limit, until December
31, 1998, the aggregate amount of cash dividends on its capital stock. Under
this policy, during that period Holdings will not pay any extraordinary cash
dividends and will limit the amount of its cash dividends, cash distributions
and repurchases for cash of capital stock and subordinated debt to an amount
equal to the sum of $500 million plus (i) 65% of Holdings' cumulative
consolidated net income before extraordinary gains or losses and restructuring
charges and (ii) net cash proceeds of up to $250 million in any year from the
sale of capital stock of Holdings or its subsidiaries (other than proceeds from
the initial public offering of the common stock of Nabisco Holdings) to the
extent used to repay, purchase or redeem debt or preferred stock. Another
policy provides that Holdings will not declare a dividend or distribution to its
stockholders of the shares of capital stock of a subsidiary before December 31,
1996. Another policy sets forth the intention of Holdings that it will not make
such a distribution prior to December 31, 1998 if that distribution would cause
the ratings of the senior indebtedness of RJRN to be reduced from investment
grade to non-investment grade or if, after giving effect to such distribution,
any publicly held senior indebtedness of the distributed company would not be
rated investment grade. There is no assurance that any such distribution will
take place. Additional policies provide that an amount equal to the net cash
proceeds from any issuance and sale of equity by Holdings or from any sale
outside the ordinary course of business of material assets owned or used by
subsidiaries in the tobacco business, in each
7
<PAGE>
case before December 31, 1998, will be used either to repay, purchase or redeem
consolidated indebtedness or to acquire properties, assets or businesses to be
used in existing or new lines of business and that an amount equal to the net
cash proceeds of any secondary sale of shares of Nabisco before December 31,
1998 will be used to repay, purchase or redeem consolidated debt. No assurance
can be given that Holdings will issue or sell any equity or sell any material
assets outside the ordinary course of business. See "Description of Holdings
Capital Stock--Contractual and Policy Restrictions on Payment of Dividends."
RJRN's credit agreement, dated as of December 1, 1991, as amended (the
"1991 Credit Agreement"), and its credit agreement, dated as of April 5, 1993,
as amended (the "1993 Credit Agreement" and, together with the 1991 Credit
Agreement, the "Credit Agreements") restrict cash dividends and other
distributions on the Common Stock. In addition, the $1.5 billion short-term
credit facility (the "Nabisco Credit Agreement") of Nabisco restricts the
payment of dividends to RJRN. RJRN and Nabisco expect to amend or replace the
Credit Agreements and the Nabisco Credit Agreement, respectively, in connection
with the Exchange Offers, Other Securities Consent Solicitation and related
transactions. The amended or replacement credit facilities may contain similar
limitations on dividends and distributions. See "Description of Holdings
Capital Stock--Contractual and Policy Restrictions on Payment of Dividends."
The timing, amount and form of future dividends, if any, will depend, among
other things, upon the effect of applicable restrictions on the payment of
dividends, results of operations, financial condition, cash requirements,
prospects and other factors deemed relevant by the Board of Directors of
Holdings.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Common Stock offered by the Selling Stockholder.
DESCRIPTION OF HOLDINGS CAPITAL STOCK
The authorized capital stock of Holdings consists of 2,200,000,000 shares
of Common Stock and 150,000,000 shares of preferred stock, par value $.01 per
share (the "Preferred Stock"). As of January 31, 1995, 1,362,133,648 shares of
Common Stock were outstanding. As of such date, 42,010,690 shares of Preferred
Stock were outstanding, of which 50,000 shares were Series B Cumulative
Preferred Stock (the "Series B Preferred Stock"), 26,675,000 shares were Series
C Preferred Stock and 15,285,690 shares were ESOP Convertible Preferred Stock
(the "ESOP Preferred Stock").
The following is a description of the terms of the capital stock of
Holdings. This description does not purport to be complete and is qualified in
its entirety by reference to Holdings' Amended and Restated Certificate of
Incorporation, as amended (the "Holdings Certificate of Incorporation"), which
has been incorporated by reference as an exhibit to the Registration Statement
of which this Prospectus is a part and is incorporated by reference herein.
Holdings believes that the summaries of the Holdings Certificate of
Incorporation set forth below are accurate and complete summaries of the
material terms of such instruments.
Common Stock
Each share of Common Stock is entitled to one vote at all meetings of
stockholders of Holdings for the election of directors of Holdings and on all
other matters. Dividends may be paid to the holders of Common Stock when, as
and if declared by the Board of Directors of Holdings out of funds legally
available therefor. The Common Stock has no preemptive or similar rights.
Holders of Common Stock are not liable to further call or assessment. Upon
liquidation, dissolution or winding up of the affairs of Holdings, any assets
remaining after provision for payment of creditors (and any liquidation
preference of any outstanding preferred stock) would be distributed pro rata
among holders of the Common Stock.
On February 15, 1995, the Board of Directors of the Company declared the
first regular quarterly cash dividend on the Common Stock of $.075 per share, or
$.30 per share on an annualized basis. The dividend is payable April 1, 1995 to
8
<PAGE>
stockholders of record on March 10, 1995. The timing, amount and form of future
dividends, if any, will depend, among other things, upon the effect of
applicable restrictions on the payment of dividends, results of operations,
financial condition, cash requirements, prospects and other factors deemed
relevant by the board of directors of Holdings. See "Description of Holdings
Capital Stock--Contractual and Policy Restrictions on Payment of Dividends."
The Common Stock is listed on the NYSE. First Chicago Trust Company of New
York is the registrar and transfer agent for the Common Stock.
Preferred Stock
Series B Preferred Stock
Each share of Series B Preferred Stock is entitled to receive, when, as and
if declared by the Board of Directors of Holdings, out of funds legally
available therefor, cumulative preferential cash dividends at the rate per annum
of 9.25%, payable quarterly in arrears. On and after August 19, 1998, Holdings,
at its option upon not less than 30 nor more than 60 days' notice, may redeem
shares of the Series B Preferred Stock, as a whole or in part, at any time, at a
redemption price equivalent to $25,000 per share, plus accrued and unpaid
dividends thereon to the date fixed for redemption, without interest, to the
extent Holdings will have funds legally available therefor.
The Series B Preferred Stock has no stated maturity and is not subject to
any sinking fund or mandatory redemption. The Series B Preferred Stock is not
convertible into, or exchangeable for, shares of any other class or series of
stock of Holdings.
The holders of the Series B Preferred Stock do not have any voting rights,
except as otherwise provided by law and under certain other limited
circumstances.
Upon any voluntary or involuntary liquidation, dissolution or winding up of
Holdings, holders of Series B Preferred Stock will be entitled to receive
$25,000 per share, plus an amount equal to any accrued and unpaid dividends,
before any distribution is made on any class of junior securities, including
Common Stock.
Series C Preferred Stock
Each share of Series C Preferred Stock is entitled to receive, when, as and
if declared by the Board of Directors of Holdings, out of funds legally
available therefor, cumulative preferential cash dividends accruing at a rate of
$6.012 per annum, payable quarterly in arrears. Each share of Series C
Preferred Stock will mandatorily convert into ten shares of Common Stock on May
15, 1997, subject to adjustment in certain events (the "Series C Common Stock
Equivalent"), plus accrued and unpaid dividends on the Series C Preferred Stock
until the date of conversion. In addition, each share of Series C Preferred
Stock may be redeemed by Holdings, in whole or in part, at any time or from time
to time prior to the mandatory conversion date at a redemption price to be paid
in shares of Common Stock (or following certain circumstances, other
consideration), plus accrued and unpaid dividends. The optional redemption
price declines from $112.286 per share by $.01656 per share on each day
following May 6, 1994 to $95.246 per share on March 15, 1997, and is $94.25
thereafter (the "Call Price").
Immediately prior to a merger or consolidation of Holdings (other than a
merger or consolidation of Holdings with or into a wholly owned subsidiary of
Holdings) that results in the conversion or exchange of Common Stock into other
securities or property, outstanding Series C Preferred Stock may be converted at
the option of Holdings into (i) shares of Common Stock at a rate equal to the
Series C Common Stock Equivalent (currently ten shares for each share of Series
C Preferred Stock), in effect immediately prior to such merger or consolidation,
plus (ii) the right to receive an amount in cash (which may, at the option of
Holdings, be payable in shares of Common Stock) equal to all accrued and unpaid
dividends on such Series C Preferred Stock to and including the Settlement Date,
plus (iii) the right to receive an amount of cash (which may, at the option of
Holdings, be payable in shares of Common Stock) initially equal to $18.036 per
share, declining by $.01656 on each day following May 6, 1994 to $.996 on March
15, 1997 and equal to zero thereafter. The shares of Common
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Stock issuable under clause (i) above will be reduced, if necessary, so that the
value of the aggregate consideration described in clauses (i) and (iii) above
does not exceed the Call Price on the Settlement Date. Alternatively, Holdings
may cause the Series C Preferred Stock to remain outstanding or convert into a
substantially similar security of Holdings or of the entity issuing the
consideration in such merger or consolidation. In that event, each holder of a
share of Series C Preferred Stock may elect to convert the Series C Preferred
Stock into Common Stock at a rate equal to the Series C Common Stock Equivalent
immediately prior to the merger or consolidation (provided that the number of
shares of Common Stock issuable will be reduced, if necessary, so that the value
of such shares does not exceed the Call Price on the Settlement Date), plus the
right to receive an amount of cash (which may, at the option of Holdings, be
payable in shares of Common Stock) equal to all accrued and unpaid dividends on
such Series C Preferred Stock to and including the Settlement Date.
If Holdings has recommended acceptance of (or has expressed no opinion and
is remaining neutral toward) a tender offer which would result in the ownership
by the bidder (or an affiliate of the bidder) of more than 50% of the then
outstanding Common Stock, then each holder of Series C Preferred Stock will have
the option to convert such shares, in whole (but not in part), into Common Stock
at the Series C Common Stock Equivalent in effect at the close of business on
the day prior to the date of expiration or termination of such tender offer;
provided that the number of shares of Common Stock issuable upon such conversion
will be reduced if necessary, so that the value of such shares does not exceed
the Call Price on such date.
If Holdings distributes to holders of Common Stock the capital stock of a
subsidiary representing all or substantially all of either of Holdings' two
present principal lines of business (the "Spinoff Company"), Holdings will
(subject to the final sentence of this paragraph) convert each share of Series C
Preferred Stock into one-half of a share of the existing Series C Preferred
Stock and one-half of a share of a substantially equivalent security of the
Spinoff Company. In such case, the conversion rate per share of the new Series
C Preferred Stock will be equal to a fraction, of which the numerator will be
the product of the market price of Common Stock prior to the distribution and
the Series C Common Stock Equivalent and of which the denominator will be the
excess of the market price of Common Stock prior to the distribution over the
market value of a share of the Spinoff Company. The conversion rate per share
of the new security of the Spinoff Company will be equal to a fraction, of which
the numerator will be the product of the market price of Common Stock prior to
the distribution and the Series C Common Stock Equivalent and of which the
denominator will be the market value of a share of the Spinoff Company.
Alternatively, Holdings may elect to distribute to each holder of Series C
Preferred Stock the number of shares of capital stock of the Spinoff Company
that such holder would have been entitled to receive if the Series C Preferred
Stock had been converted to Common Stock immediately prior to the distribution
at the Series C Common Stock Equivalent then in effect. In the event that
either (a) the fair value of the shares of the Spinoff Company distributed are
greater than or equal to 95% of the market price of Common Stock prior to the
distribution or (b) the record date for the distribution is fixed less than
twenty-one trading days prior to such record date, then Holdings must elect to
distribute the shares of the Spinoff Company to the holders of the shares of
Series C Preferred Stock in accordance with the preceding sentence.
Holders of Series C Preferred Stock have the right, voting together with
the holders of Common Stock (and any other class of capital stock of Holdings
entitled to vote together with the Common Stock, including the ESOP Preferred
Stock) as one class, to vote in the election of directors and upon each other
matter coming before any meeting of the stockholders on the basis initially of
one vote (equal to one-tenth of the Series C Common Stock Equivalent) for each
Series C Preferred Stock held; provided that the holders of Series C Preferred
Stock are not entitled to vote on any increase or decrease in the number of
authorized shares of any class or classes of stock. In the event dividends on
all series of Preferred Stock, including the Series C Preferred Stock, were in
arrears and unpaid for six quarterly periods, the holders of Series C Preferred
Stock, together with the holders of all other outstanding series of Preferred
Stock entitled to vote thereon, would be entitled to elect two additional
directors to the Board of Directors of Holdings until all cumulative dividends
on all series of Preferred Stock, have been paid or declared and set aside for
payment; provided that such directors may not have exceeded 25% of the total
Board of Directors or be less than one director. While such holders are
entitled to elect two directors, they would not be entitled to participate with
the holders of Common Stock in the election of any other directors, but would
have continued to vote with the holders of Common Stock upon each other matter
coming before any meeting of the stockholders.
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Upon any voluntary or involuntary liquidation, dissolution or winding up of
Holdings, holders of Series C Preferred Stock will be entitled to receive $60.50
per share, plus an amount equal to any accrued and unpaid dividends, before any
distribution is made on any class of junior securities, including Common Stock.
ESOP Preferred Stock
Each share of ESOP Preferred Stock is entitled to receive, when, as and if
declared by the Board of Directors of Holdings, out of funds legally available
therefor, cumulative cash dividends at a rate of 7.8125% of stated value per
annum ($1.25 per annum) at least until April 10, 1999, payable semi-annually in
arrears. Each share of ESOP Preferred Stock is convertible into one share of
Common Stock, subject to adjustment in certain events. The ESOP Preferred Stock
is redeemable at the option of Holdings, in whole or in part, at any time on or
after April 10, 1999, at an initial optional redemption price of $16.25 per
share, declining thereafter on an annual basis in the amount of $.125 a year to
$16 per share on April 10, 2001, plus accrued and unpaid dividends. Under
certain other circumstances, the ESOP Preferred Stock is subject to redemption
at any time. Holders of ESOP Preferred Stock have voting rights which are
generally consistent with those of the holders of Series C Preferred Stock.
Upon any voluntary or involuntary liquidation, dissolution or winding up of
Holdings, holders of ESOP Preferred Stock will be entitled to receive $16.00 per
share, plus an amount equal to any accrued and unpaid dividends, before any
distribution is made on any class of junior securities, including Common Stock.
Contractual and Policy Restrictions on Payment of Dividends
Holdings is subject to various contractual restrictions on its ability to
pay dividends on its Preferred Stock and Common Stock.
Under the Credit Agreements, Holdings may (i) issue shares of Common Stock
upon the exercise of any warrants or options or upon the conversion or
redemption of any convertible or redeemable preferred stock and, in connection
with any such exercise, conversion or redemption, Holdings may pay cash in lieu
of issuing fractional shares of Common Stock; (ii) if no event of default
existed under the Credit Agreements, repurchase Common Stock (and/or options or
warrants in respect thereof) pursuant to, and in accordance with the terms of,
management and/or employee stock plans; (iii) if no event of default existed
under the Credit Agreements, declare and pay, or otherwise effect, any other
cash dividend or other dividend or distribution, or repurchase or redeem any
capital stock, provided that the aggregate amount of such dividends,
distributions, repurchases and redemptions, when added to all dividends,
distributions, repurchases and redemptions made in accordance with this clause
(iii) after November 22, 1994, would not exceed an amount equal to the sum of
(x) $1 billion plus (y) 50% of the sum of (A) consolidated net income of
Holdings and its subsidiaries for the period (taken as one accounting period)
from January 1, 1995 to the last day of the last fiscal quarter of Holdings then
ended plus (B) all losses from debt retirement deducted in determining
consolidated net income of Holdings and its subsidiaries for the period referred
to in clause (A) above plus (z) the aggregate cash proceeds (net of underwriting
discounts and commissions) received by Holdings after November 22, 1994 from
issuances of its equity securities (provided that the aggregate amount of such
aggregate net cash proceeds received in any twelve-month period shall be deemed
not to exceed $250 million for purposes of this clause (iii)(z)), in each case
determined at the time of the declaration thereof, provided that such dividend,
distribution or redemption payment was paid within 45 days of the making of such
declaration; (iv) issue and exchange shares of any class or series of its common
stock now or hereafter outstanding for shares of any other class or series of
its common stock now or hereafter outstanding; and (v) in connection with any
reclassification of its common stock and any exchange permitted by clause (v)
above, pay cash in lieu of issuing fractional shares of any class or series of
its common stock. The Nabisco Credit Agreement also limits payment of dividends
by Nabisco to $300 million plus 50% of the cumulative consolidated net income of
Nabisco commencing January 1, 1995. RJRN and Nabisco expect to amend or replace
the Credit Agreements and the Nabisco Credit Agreement, respectively, in
connection with the Exchange Offers, Other Securities Consent Solicitation and
related transactions. The amended or replacement credit facilities may contain
similar limitations on dividends and distributions.
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In addition to the contractual restrictions referred to above, the Board of
Directors of Holdings has adopted a policy, under which Holdings will limit,
until December 31, 1998, the aggregate amount of cash dividends on its Capital
Stock. Under this policy, Holdings:
(a) will not pay any extraordinary cash dividends;
(b) will not make any Restricted Payment if, after giving effect to
such Restricted Payment, the aggregate amount expended for all Restricted
Payments subsequent to December 31, 1994 exceeds the sum of (i) $500
million, plus (ii) 65% of Consolidated Net Income of Holdings on a
cumulative basis subsequent to December 31, 1994, plus (iii) aggregate cash
proceeds of up to $250 million received in any year subsequent to December
31, 1994 by Holdings or a Subsidiary from the issuance and sale (other than
to a Subsidiary) of Holdings' or such Subsidiary's Capital Stock (or of
other securities that are subsequently converted into or exchanged for
Holdings' or such Subsidiary's Capital Stock) (other than proceeds from the
initial public offering of common stock of Nabisco Holdings), it being
understood that any aggregate net cash proceeds from any issuance and sale
of any Capital Stock will be counted only up to the amount of any
indebtedness or preferred stock of Holdings or any Subsidiary that has been
repaid, purchased, redeemed or otherwise acquired for value by Holdings or
any Subsidiary within one year before or after such issuance and sale. If
Holdings or a Subsidiary repays, purchases, redeems or otherwise acquires
for value indebtedness or preferred stock of Holdings or a Subsidiary in
exchange for Capital Stock of Holdings or a Subsidiary, Holdings or such
Subsidiary shall be deemed to have received the net cash proceeds equal to
the market value of the Capital Stock so issued in exchange (such market
value to be determined by Holdings' Board of Directors, whose good faith
determination shall be conclusive);
(c) will use an amount equal to the net cash proceeds received prior
to December 31, 1998 from (i) the issuance and sale by Holdings of any
Capital Stock (other than to a Subsidiary or current, future or former
directors, officers or employees of Holdings or any Subsidiary (or their
estates or beneficiaries under their estates)) or (ii) any sale outside the
ordinary course of business of material assets owned or used by any of its
Subsidiaries in the tobacco business (other than to another Subsidiary)
either to repay, purchase, redeem or otherwise acquire for value
indebtedness of Holdings or a Subsidiary or to acquire properties, assets
or businesses to be used in existing or new lines of business of Holdings
or its Subsidiaries; and
(d) will use an amount equal to the net cash proceeds received by
Holdings or RJRN prior to December 31, 1998 from the sale to third parties
of shares of common stock of Nabisco held by either of them to repay,
purchase, redeem or otherwise acquire for value indebtedness of Holdings or
a Subsidiary.
The foregoing policy will not prevent the payment of a cash dividend within
90 days of its declaration if, at the time of declaration, such payment would
have complied with the foregoing policy or the purchase, redemption,
acquisition, cancellation or other retirement for value of Capital Stock,
options on Capital Stock, stock appreciation rights or similar securities held
by current, future or former directors, officers or employees of Holdings or any
Subsidiary or certain trusts or estates for their benefit.
Holdings has also adopted a policy to the effect that it will not declare a
dividend or distribution on its Capital Stock prior to December 31, 1996 that is
paid in Capital Stock of a Subsidiary owned by Holdings or a Subsidiary and that
it is its intent not to make such a distribution to its stockholders prior to
December 31, 1998 if (a) such distribution would cause the ratings of RJRN's
publicly held senior indebtedness to be reduced from investment grade to
non-investment grade or (b) any publicly held senior indebtedness of the
distributed Subsidiary would, after giving effect to such distribution, be rated
non-investment grade.
For purposes of the foregoing policies:
"Capital Stock" means any and all shares, interests, participations or
other equivalents (however designated) of capital stock and any rights
(other than debt securities convertible into capital stock), warrants or
options to acquire such Capital Stock.
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"Consolidated Net Income" of Holdings means, for any period, the
aggregate consolidated net income of Holdings and its Subsidiaries for such
period, determined on a consolidated basis in accordance with generally
accepted accounting principles as in effect from time to time, adjusted by
excluding (to the extent not otherwise excluded in calculating consolidated
net income) any net extraordinary gain or net extraordinary loss, as the
case may be, and any restructuring charges.
"Restricted Payment" means (i) any payment of any cash dividend or
distribution by Holdings on its Capital Stock, (ii) any purchase,
redemption or other acquisition for cash by Holdings of its Capital Stock
(other than any such purchase, redemption or acquisition for value in
exchange for, or in an amount equal to the proceeds of, an offering of
Capital Stock of Holdings or any Subsidiary or, in the case of Holdings'
Series B Preferred Stock or any other non-convertible preferred stock of
Holdings outstanding from time to time), for indebtedness of Holdings or
any Subsidiary and (iii) any purchase, redemption or other acquisition for
cash by Holdings of any Subordinated Debt prior to any scheduled maturity,
scheduled repayment or scheduled sinking fund payment (other than any such
purchase, redemption or other acquisition for value in exchange for, or in
an amount equal to the proceeds of, an offering of Capital Stock or
Subordinated Debt of Holdings or any Subsidiary).
"Subordinated Debt" means any indebtedness of Holdings or any
Subsidiary which by its terms is expressly subordinated in right of payment
to any other indebtedness of Holdings or any Subsidiary, provided, however,
that the term Subordinated Debt shall not include any intercompany
indebtedness.
"Subsidiary" means any entity of which securities or other ownership
interests having ordinary voting power to elect a majority of the Board of
Directors or other persons performing similar functions are at the time
directly or indirectly owned by Holdings.
Certain Statutory and By-law Provisions
Holdings is subject to the "business combination" statute of the Delaware
General Corporation Law (the "DGCL"). In general, Section 203 of the DGCL
prohibits a publicly held Delaware corporation from engaging in a "business
combination" with an "interested stockholder" for a period of three years after
the date of the transaction in which the person became an "interested
stockholder," unless (a) prior to such date the Board of Directors of the
corporation approved either the "business combination" or the transaction which
resulted in the stockholder becoming an "interested stockholder," (b) upon
consummation of the transaction which resulted in the stockholder becoming an
"interested stockholder," the "interested stockholder" owned at least 85% of the
voting stock of the corporation outstanding at the time the transaction
commenced, excluding for purposes of determining the number of shares
outstanding those shares owned (i) by persons who are directors and also
officers and (ii) employee stock plans in which employee participants do not
have the right to determine confidentially whether shares held subject to the
plan will be tendered in a tender or exchange offer, or (c) on or subsequent to
such date the "business combination" is approved by the Board of Directors and
authorized at an annual or special meeting of stockholders by the affirmative
vote of at least 66 2/3% of the outstanding voting stock which is not owned by
the "interested stockholder." A "business combination" includes mergers, certain
stock or asset sales and certain other transactions resulting in a financial
benefit to, or increase in voting power held by, the "interested stockholders."
An "interested stockholder" is a person who, together with affiliates and
associates, owns (or if such person is an affiliate or associate of the
corporation within three years, did own) 15% or more of the corporation's voting
stock.
Holdings' By-laws establish an advance notice procedure for stockholders to
make nominations of candidates for election as directors, or to bring other
business before an annual meeting of stockholders of Holdings. The By-laws
provide that only persons who are nominated by, or at the direction of, the
Board of Directors of Holdings or any committee designated by the Board of
Directors of Holdings, or by a stockholder who has given timely written notice
to the Secretary of Holdings prior to the meeting at which directors are to be
elected, will be eligible for election as directors of Holdings. The By-laws
also provide that in order to properly submit any business to an annual meeting
of stockholders, a stockholder must give timely written notice to the Secretary
of Holdings of such stockholder's intention to bring such business before such
meeting. Generally, for notice of stockholder nominations or other business to
be made at an annual meeting to be timely under the By-laws, such notice must be
received by Holdings (i) not less than 120 days nor more than 150 days before
the
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first anniversary date of Holdings' proxy statement in connection with the last
annual meeting of stockholders or (ii) if no annual meeting was held in the
previous year or the date of the applicable annual meeting has been changed by
more than 30 days from the date contemplated at the time of the previous year's
proxy statement, not less than a reasonable time, as determined by the Board of
Directors of Holdings, prior to the date of the applicable annual meeting.
Under the By-laws, a stockholder's notice must also contain certain information
specified in the By-laws.
The provisions described above, together with certain terms of Holdings
outstanding Preferred Stock and its ability to issue additional Preferred Stock,
may have the effect of delaying stockholder actions with respect to certain
business combinations and the election of new members of the Board of Directors
of Holdings. As such, the provisions could have the effect of discouraging open
market purchases of Common Stock because they may be considered disadvantageous
by a stockholder who desires to participate in a business combination or elect a
new director.
SELLING STOCKHOLDER
Prior to the offering of any shares of Holdings Common Stock pursuant to
this Prospectus, Borden beneficially owns 111,047,230 shares of Holdings Common
Stock, representing approximately 8.15% (6.52% on a fully diluted basis) of the
outstanding shares of Holdings Common Stock as of January 31, 1995. After the
offering of all of the shares of Holdings Common Stock which may be offered from
time to time hereby, the Selling Stockholder will not own or control any shares
of Holdings Common Stock. As described further under "Plan of Distribution,"
the Selling Stockholder may issue securities which are convertible, exchangeable
or redeemable at some future date into or for all or a portion of the shares of
the Holdings Common Stock owned by the Selling Stockholder.
The Selling Stockholder is wholly owned by affiliates of KKR, and received
the shares of Holdings Common Stock to be offered pursuant to this Prospectus
from such affiliates. Following the sale of all of the shares of Holdings
Common Stock that may be offered hereby, KKR and its affiliates will own or
control fewer than 0.1% of the outstanding shares of Holdings Common Stock as of
January 31, 1995. Currently, seven of Holdings' sixteen directors are partners
of KKR. None of the nominees for election to Holdings' Board of Directors at
Holdings' annual meeting in April 1995 are partners of KKR.
PLAN OF DISTRIBUTION
The Company has been advised that the distribution of the Common Stock by
the Selling Stockholder may be effected in and/or outside the United States:
(i) through underwriters or dealers; (ii) directly to a limited number of
purchasers or to a single purchaser; (iii) through agents; or (iv) in the event
that the Selling Stockholder issues securities of its own which are convertible,
exchangeable or redeemable for or into shares of Holdings Common Stock, upon
conversion, exchange or redemption of such securities of the Selling
Stockholder. The Prospectus Supplement with respect to the Common Stock being
offered (the "Offered Shares") will set forth the terms of the offering of the
Offered Shares, including the name or names of any underwriters or agents, the
purchase price of the Offered Shares and the proceeds to the Selling Stockholder
from such sale, any delayed delivery arrangements, any underwriting discounts
and other items constituting underwriters' compensation, any initial public
offering price and any discounts or concessions allowed or reallowed or paid to
dealers. Any initial public offering price and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time to time.
The Company has been further advised that, if underwriters are used in the
sale, the Offered Shares will be acquired by the underwriters for their own
account and may be resold from time to time in one or more transactions,
including negotiated transactions, at a fixed public offering price or at
varying prices determined at the time of sale. The Common Stock may be offered
to the public either through underwriting syndicates represented by one or more
managing underwriters or directly by one or more firms acting as underwriters.
The underwriter or underwriters with respect to a particular underwritten
offering of Common Stock will be named in the Prospectus Supplement relating to
such offering and, if an underwriting syndicate is used, the managing
underwriter or underwriters, will be set forth on the cover of such Prospectus
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Supplement. Unless otherwise set forth in the Prospectus Supplement relating
thereto, the obligations of the underwriters to purchase the Offered Shares will
be subject to conditions precedent and the underwriters will be obligated to
purchase all the Offered Shares if any are purchased.
If dealers are utilized in the sale of Offered Shares in respect of which
this Prospectus is delivered, the Company has been advised that the Selling
Stockholder will sell such Offered Shares to the dealers as principals. The
dealers may then resell such Offered Shares to the public at varying prices to
be determined by such dealers at the time of resale. The names of the dealers
and the terms of the transaction will be set forth in the Prospectus Supplement
relating thereto.
In addition, the Company has been advised that the Common Stock may be sold
directly by the Selling Stockholder or through agents designated by the Selling
Stockholder from time to time. Any agent involved in the offer or sale of the
Offered Shares in respect of which this Prospectus is delivered will be named,
and any commissions payable by the Selling Stockholder to such agent will be set
forth, in the Prospectus Supplement.
Agents and underwriters may be entitled under agreements entered into with
the Company and the Selling Stockholder to indemnification by the Company and
the Selling Stockholder against certain civil liabilities, including liabilities
under the Securities Act, or to contribution with respect to payments which the
agents or underwriters may be required to make in respect thereof. Agents and
underwriters may be customers of, may engage in transactions with, or perform
services for, the Company and the Selling Stockholder in the ordinary course of
business.
In connection with the sale of the Common Stock, underwriters or agents may
be deemed to have received compensation from the Selling Stockholder in the form
of underwriting discounts or commissions and may also receive commissions from
purchasers of the Common Stock for whom they may act as agent. Underwriters or
agents may sell the Common Stock to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters or commissions from the purchasers for whom they may act as
agent.
Any underwriters, dealers or agents participating in the distribution of
the Common Stock may be deemed to be underwriters, and any discounts and
commissions received by them and any profit realized by them on resale of the
Common Stock may be deemed to be underwriting discounts and commissions under
the Securities Act of 1933.
LEGAL MATTERS
The validity of the Common Stock being offered hereby will be passed upon
for Holdings by Jo-Ann Ford, Senior Vice President, Law and Secretary of
Holdings and for the underwriters, brokers or agents by counsel to such
underwriters, brokers or agents. Ms. Ford owns options to purchase shares of
Common Stock which represent less than 0.1% of the currently outstanding shares
of Common Stock.
EXPERTS
The consolidated financial statements of Holdings as of December 31, 1994
and 1993 and for each of the years in the three year period ended December 31,
1994 incorporated in this Prospectus by reference from Holdings' Annual Report
on Form 10-K for the year ended December 31, 1994 have been audited by Deloitte
& Touche LLP, independent auditors, as stated in their reports, which are
incorporated herein by reference, and have been so incorporated in reliance upon
the reports of such firm given upon their authority as experts in accounting and
auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the expenses in connection with the
issuance and distribution of the Common Stock being registered, other than
underwriting discounts and commissions. All of the amounts shown are estimates,
except the SEC registration fee.
Registration Fee . . . . . . . . . . . . . . $ 220,181.39
Blue Sky fees and expenses . . . . . . . . . 15,000.00
Printing and engraving expenses . . . . . . . 200,000.00
Legal fees and expenses . . . . . . . . . . . 25,000.00
Accounting fees and expenses . . . . . . . . 10,000.00
Miscellaneous . . . . . . . . . . . . . . . . 10,000.00
------------
Total . . . . . . . . . . . . . . . . . . $ 480,181.39
============
Item 15. Indemnification of Directors and Officers.
Section 145 of the General Corporation Law of the State of Delaware
(the "Delaware Law") empowers a Delaware corporation to indemnify any persons
who are, or are threatened to be made, parties to any threatened, pending or
completed legal action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of such
corporation), by reason of the fact that such person was an officer or director
of such corporation, or is or was serving at the request of such corporation as
a director, officer, employee or agent of another corporation or enterprise.
The indemnity may include expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by such person
in connection with such action, suit or proceeding, provided that such officer
or director acted in good faith and in a manner he reasonably believed to be in
or not opposed to the corporation's best interests, and, for criminal
proceedings, had no reasonable cause to believe his conduct was illegal. A
Delaware corporation may indemnify officers and directors against expenses
(including attorneys' fees) in connection with the defense or settlement of an
action by or in the right of the corporation under the same conditions, except
that no indemnification is permitted without judicial approval if the officer or
director is adjudged to be liable to the corporation. Where an officer or
director is successful on the merits or otherwise in the defense of any action
referred to above, the corporation must indemnify him against the expenses which
such officer or director actually and reasonably incurred.
In accordance with the Delaware Law, the Certificate of Incorporation
of the Company contains a provision to limit the personal liability of the
directors of the Company for violations of
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their fiduciary duty. This provision eliminates each director's liability to
the Company or its stockholders for monetary damages except (i) for any breach
of the director's duty of loyalty to the Company or its stockholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct or a
knowing violation of law, (iii) under Section 174 of the Delaware Law providing
for liability of directors for unlawful payment of dividends or unlawful stock
purchases or redemptions, or (iv) for any transaction from which a director
derived an improper personal benefit. The effect of this provision is to
eliminate the personal liability of directors for monetary damages for actions
involving a breach of their fiduciary duty of care, including any such actions
involving gross negligence.
Article IV of the Amended and Restated By-Laws of the Company provides
for indemnification of the officers and directors of the Company to the full
extent permitted by applicable law.
Item 16. Exhibits.
Exhibit No. Description
- ----------- -----------
*1.1 Form of Purchase Agreement.
*5.1 Opinion of Jo-Ann Ford regarding the
legality of the securities being
registered.
*23.1 Consent of Deloitte & Touche LLP,
Independent Auditors for RJR Nabisco
Holdings Corp. and RJR Nabisco, Inc.
*23.2 Consent of Jo-Ann Ford (included in her
opinion filed as Exhibit 5.1).
*24.1 Powers of Attorney of Charles M. Harper,
Stephen R. Wilson, Robert S. Roath, John
T. Chain, Jr., Julius L. Chambers, John
L. Clendenin, James H. Greene, Jr., H.
John Greeniaus, James W. Johnston, Henry
R. Kravis, John G. Medlin, Jr., Paul E.
Raether, Lawrence R. Ricciardi, Rozanne
L. Ridgeway, Clifton S. Robbins, George
R. Roberts, Scott M. Stuart and Michael
T. Tokarz.
_________________
* Filed herewith
II-2
<PAGE>
Item 17. Undertakings.
The undersigned Registrant hereby undertakes:
(a) (1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
- -------- -------
Registration Statement is on Form S-3, Form S-8 or Form F-3 and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission by the
Registrant pursuant to section 13 or section 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) (1) That, for purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of prospectus
filed as part of this Registration Statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) under the Securities Act of 1933 shall be deemed to be part of
this Registration Statement as of the time it was declared effective.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such
II-3
<PAGE>
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant's annual report pursuant to section
13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(d) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the provisions referred to in Item 15 of
this Registration Statement, or otherwise, the Registrant has been advised that
in the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act of 1933 and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act of 1933 and will be governed by the
final adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York, March 15, 1995.
RJR Nabisco Holdings Corp.
By /s/ Jo-Ann Ford
-----------------------
Title: Senior Vice President, Law
and Secretary
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities indicated on March 15, 1995.
Signature Title
--------- -----
*
............................ Chairman of the Board and Chief
(Charles M. Harper) Executive Officer (principal
executive officer) and Director
*
............................ Executive Vice President and Chief
(Stephen R. Wilson) Financial Officer (principal
financial officer)
*
............................ Senior Vice President and
(Robert S. Roath) Controller (principal accounting
officer)
*
............................ Director
(John T. Chain, Jr.)
*
............................ Director
(Julius L. Chambers)
*
............................ Director
(John L. Clendenin)
*
............................ Director
(James H. Greene, Jr.)
II-5
<PAGE>
*
............................ Director
(H. John Greeniaus)
*
............................ Director
(James W. Johnston)
*
............................ Director
(Henry R. Kravis)
*
............................ Director
(John G. Medlin, Jr.)
*
............................ Director
(Paul E. Raether)
*
............................ Director
(Lawrence R. Ricciardi)
*
............................ Director
(Rozanne L. Ridgway)
*
............................ Director
(Clifton S. Robbins)
*
............................ Director
(George R. Roberts)
*
............................ Director
(Scott M. Stuart)
*
............................ Director
(Michael T. Tokarz)
/s/ Jo-Ann Ford
* By: ........................
Jo-Ann Ford
Attorney-in-fact
II-6
<PAGE>
EXHIBIT INDEX
Exhibit No. Description Page
- ----------- ----------- ----
*1.1 Form of Purchase Agreement.
*5.1 Opinion of Jo-Ann Ford regarding the
legality of the securities being
registered.
*23.1 Consent of Deloitte & Touche LLP,
Independent Auditors for RJR Nabisco
Holdings Corp. and RJR Nabisco, Inc.
*23.2 Consent of Jo-Ann Ford (included in her
opinion filed as Exhibit 5.1).
*24.1 Powers of Attorney of Charles M. Harper,
Stephen R. Wilson, Robert S. Roath, John
T. Chain, Jr., Julius L. Chambers, John
L. Clendenin, James H. Greene, Jr., H.
John Greeniaus, James W. Johnston, Henry
R. Kravis, John G. Medlin, Jr., Paul E.
Raether, Lawrence R. Ricciardi, Rozanne
L. Ridgeway, Clifton S. Robbins, George
R. Roberts, Scott M. Stuart and Michael
T. Tokarz.
_________________
* Filed herewith
i
EXHIBIT 1.1
RJR NABISCO HOLDINGS CORP.
FORM OF
PURCHASE AGREEMENT
STANDARD PROVISIONS FOR SECONDARY OFFERING
(COMMON STOCK)
________, 199_
From time to time, [ ], a [ ] corporation
(the "Selling Stockholder"), and RJR Nabisco Holdings Corp., a Delaware
corporation (the "Company"), may enter into one or more purchase agreements
that provide for the sale of up to 111,047,230 shares of Common Stock, par
value $.01 per share (the "Registered Shares"), of the Company by the
Selling Stockholder to the several underwriters named therein. The
Registered Shares involved in any such offering are hereinafter referred to
as the "Shares". The standard provisions set forth herein may be
incorporated by reference in any such purchase agreement (a "Purchase
Agreement"). The Purchase Agreement, including the provisions incorporated
therein by reference, is herein referred to as this Agreement.
The Company has filed with the Securities and Exchange Commission
(the "Commission") a registration statement, including a prospectus,
relating to the Shares and has filed with, or transmitted for filing to, or
shall promptly hereafter file with or transmit for filing to, the
Commission a prospectus supplement (the "Prospectus Supplement")
specifically relating to the Shares pursuant to Rule 424 under the
Securities Act of 1933, as amended (the "Securities Act"). The term
"Registration Statement" means the registration statement, including the
exhibits thereto, as amended to the date of this Agreement. The term
"Basic Prospectus" means the prospectus included in the Registration
Statement. The term "Prospectus" means the Basic Prospectus together with
the Prospectus Supplement. The term "preliminary prospectus" means a
preliminary prospectus supplement specifically relating to the Shares
together with the Basic Prospectus. As used herein, the terms "Basic
Prospectus," "Prospectus" and "preliminary prospectus" shall include in
each case the documents, if any, incorporated by reference therein. The
terms "supplement" and "amendment" or "amend" as used herein shall include
all documents deemed to be incorporated by reference in the Prospectus that
are filed subsequent to the date of the Basic Prospectus by the Company
with the Commission pursuant to the Securities Exchange Act of 1934, as
amended (the "Exchange Act").
<PAGE>
1. Representations and Warranties of the Company. The Company
---------------------------------------------
represents and warrants to each of the Underwriters (as defined in the
Purchase Agreement) that:
(a) The Registration Statement has become effective under the
Securities Act; no stop order suspending the effectiveness of the
Registration Statement is in effect, and no proceedings for such
purpose are pending before or, to the Company's knowledge, threatened
by the Commission.
(b) (i) Each document, if any, filed or to be filed pursuant to
the Exchange Act and incorporated by reference in the Prospectus
complied or will comply when so filed in all material respects with
the Exchange Act and the applicable rules and regulations of the
Commission thereunder, (ii) each part of the Registration Statement,
when such part became effective, did not contain, and each such part,
as amended or supplemented, if applicable, will not contain any untrue
statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading, (iii) the Registration Statement and the Prospectus
comply, and, as amended or supplemented, if applicable, will comply in
all material respects with the Securities Act and the applicable rules
and regulations of the Commission thereunder and (iv) the Prospectus
does not contain and, as amended or supplemented, if applicable, will
not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading,
except that the representations and warranties set forth in this
Section 1(b) do not apply to statements or omissions in the
Registration Statement or the Prospectus based upon information
relating to (A) any Underwriter furnished to the Company in writing by
such Underwriter through the Manager (as defined in the Purchase
Agreement) expressly for use therein or (B) the Selling Stockholder
relating to the Selling Stockholder furnished to the Company in
writing by the Selling Stockholder expressly for use therein.
(c) The Company has been duly incorporated, is validly existing
as a corporation in good standing under the laws of the State of
Delaware, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on the financial condition or the
results of operations of the Company and its subsidiaries, taken as a
whole.
-2-
<PAGE>
(d) Each of RJR Nabisco, Inc. ("RJRN"), R.J. Reynolds Tobacco
Company, R.J. Reynolds Tobacco International, Inc. and Nabisco
Holdings Corp. ("Nabisco") (collectively, the "Principal Operating
Subsidiaries") has been duly incorporated, is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own its
property and to conduct its business as described in the Prospectus
and is duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except
to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the financial
condition or the results of operations of the Company and its
subsidiaries, taken as a whole.
(e) (i) The authorized capital stock of the Company conforms as
to legal matters to the description thereof contained in the
Prospectus; (ii) except as set forth in the Prospectus and except for
51,750,000 shares of Class A Common Stock of Nabisco, all of the
outstanding capital stock of each of the Principal Operating
Subsidiaries which is owned by the Company is owned directly or
indirectly by the Company free and clear of any security interest,
claim, lien or other encumbrance or preemptive rights; and (iii)
except for (A) options to acquire common stock of Nabisco granted to
certain directors, officers and employees of the Company and Nabisco
and (B) the option granted to RJRN to acquire shares of Class B Common
Stock of Nabisco pursuant to the Corporate Agreement between RJRN and
Nabisco dated as of January 26, 1995 and the rights of holders of
the Class A Common Stock and Class B Common Stock of Nabisco to convert
their shares into shares of the other class in accordance with the
Certificate of Incorporation of Nabisco under certain circumstances,
there are no outstanding rights (including, without limitation,
preemptive rights), warrants or options to acquire, or instruments
convertible into or exchangeable for, any shares of capital stock or
other equity interest in any of the Principal Operating Subsidiaries or
any contract, commitment, agreement, understanding or arrangement of any
kind relating to the issuance of any such capital stock, any such
convertible or exchangeable securities or any such rights, warrants or
options.
(f) This Agreement has been duly authorized, executed and
delivered by the Company.
(g) The Shares have been duly authorized and are validly issued,
fully paid and nonassessable.
(h) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not contravene any provision of applicable law or the certificate
of incorporation or by-laws of the Company or any agreement or other
instrument
-3-
<PAGE>
binding upon the Company or any of its subsidiaries or any judgment,
order or decree of any governmental body, agency or court having
jurisdiction over the Company or any subsidiary, except for such
contraventions that would not have a material adverse effect on the
financial condition or results of operations of the Company and its
subsidiaries taken as a whole, and no consent, approval, authorization
or order of or qualification with any governmental body or agency is
required for the performance by the Company of its obligations under
this Agreement, except such as have been obtained and except such as
may be required by the securities or Blue Sky laws of the various
states or other jurisdictions in connection with the offer and sale of
the Shares.
(i) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
financial condition or results of operations of the Company and its
subsidiaries, taken as a whole, from that set forth in the Prospectus
(including any amendments or supplements thereto subsequent to the
date of this Agreement which have been agreed to by the Manager and
the Company).
(j) There are no legal or governmental proceedings pending or,
to the best of the Company's knowledge, threatened to which the
Company or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject that
are required to be described in the Registration Statement or the
Prospectus and are not so described or any statutes, regulations,
contracts or other documents that are required to be described in the
Registration Statement or the Prospectus or to be filed as exhibits to
the Registration Statement that are not described or filed as
required.
(k) Neither the Company nor RJRN is, or after giving effect to
the offering and sale of the Shares will be, and neither the Company
nor RJRN is directly or indirectly controlled by, or acting on behalf
of any person which is, an investment company within the meaning of
the Investment Company Act of 1940, as amended.
(l) The Company has complied with all provisions of Section
517.075 Florida Statutes (Chapter 92-198, Laws of Florida).
2. Representations and Warranties of the Selling Stockholder.
---------------------------------------------------------
The Selling Stockholder represents and warrants to each of the Underwriters
that:
(a) The Selling Stockholder has been duly incorporated, is
validly existing as a corporation in good
-4-
<PAGE>
standing under the laws of the jurisdiction of its organization, has
the corporate power and authority to own its property and to conduct
its business and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or
its ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be in good
standing would not have a material adverse effect on the financial
condition or results of operations of the Selling Stockholder and its
subsidiaries, taken as a whole.
(b) This Agreement has been duly authorized, executed and
delivered by the Selling Stockholder.
(c) The execution and delivery by the Selling Stockholder of,
and the performance by the Selling Stockholder of its obligations
under, this Agreement will not contravene any provision of applicable
law or the certificate of incorporation or by-laws of the Selling
Stockholder or any agreement or other instrument binding upon the
Selling Stockholder or any of its subsidiaries or any judgment, order
or decree of any governmental body, agency or court having
jurisdiction over the Selling Stockholder or any subsidiary, except
for contraventions that would not have a material adverse effect on
the financial condition or results of operations of the Selling
Stockholder and its subsidiaries taken as a whole, and no consent,
approval, authorization or order of or qualification with any
governmental body or agency is required for the performance by the
Selling Stockholder of its obligations under this Agreement, except
such as have been obtained and except such as may be required by the
securities or Blue Sky laws of the various states or other
jurisdictions in connection with the offer and sale of the Shares.
(d) The Selling Stockholder has good and valid title to the
Shares, free and clear of all liens, encumbrances, equities or claims
and the legal right and power to enter into this Agreement.
(e) Upon delivery of the Shares and payment therefor pursuant to
this Agreement, the Selling Stockholder will pass good and valid title
to the Shares free and clear of all liens, encumbrances, equities or
claims.
(f) (i) Each part of the Registration Statement relating to the
Selling Stockholder furnished to the Company in writing by the Selling
Stockholder expressly for use therein, when such part became
effective, did not contain and each such part, as amended or
supplemented, if applicable, will not contain any untrue statement of
a
-5-
<PAGE>
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading and
(ii) each part of the Prospectus relating to the Selling Stockholder
furnished to the Company in writing by the Selling Stockholder
expressly for use therein does not contain and, as amended or
supplemented, if applicable, will not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading.
3. Public Offering. The Company and the Selling Stockholder
---------------
are advised by the Manager that the Underwriters propose to make a public
offering of their respective portions of the Shares as soon after this
Agreement has been entered into as in the Manager's judgment is advisable.
The terms of the public offering of the Shares are set forth in the
Prospectus. Each Underwriter agrees and acknowledges that it will not,
directly or indirectly, offer, transfer, sell, assign, pledge, hypothecate
or otherwise dispose of any Shares, or solicit any offers to purchase or
otherwise acquire or take a pledge of any Shares, unless (a) such transfer,
sale, assignment, pledge, hypothecation or other disposition is pursuant to
an effective registration statement under the Securities Act and has been
registered under all applicable securities or Blue Sky laws of the various
states or other jurisdictions in connection with the offer and sale of the
Shares or (b) it shall have furnished to Holdings and the Selling
Stockholder an opinion of counsel to the effect that no such registration
is required because of the availability of an exemption from registration
under the Securities Act and all applicable securities or Blue Sky laws of
the various states or other jurisdictions in connection with the offer and
sale of the Shares.
4. Purchase and Delivery. Except as otherwise provided in this
---------------------
Section 4, payment for the Shares shall be made by certified or official
bank check or checks payable to the order of the Selling Stockholder in New
York Clearing House funds (or such other funds as are specified in the
Purchase Agreement) at the time and place set forth in the Purchase
Agreement, upon delivery to the Manager for the respective accounts of the
several Underwriters of the Shares, registered in such names and in such
denominations as the Manager shall request in writing not less than two
full business days prior to the date of delivery, with any transfer taxes
payable in connection with the transfer of the Shares to the Underwriters
duly paid.
5. Conditions to Closing. The several obligations of the
---------------------
Underwriters hereunder are subject to the following conditions:
(a) Subsequent to the execution and delivery of the Purchase
Agreement and prior to the Closing Date, there
-6-
<PAGE>
shall not have occurred any change, or any development involving a
prospective change, in the financial condition or results of
operations of the Company and its subsidiaries, taken as a whole, from
that set forth in the Prospectus, that, in the judgment of the
Manager, is material and adverse and that makes it, in the judgment of
the Manager, impracticable to market the Shares on the terms and in
the manner contemplated in the Prospectus.
(b) The Manager shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer
of the Company, to the effect set forth in clause (a) above and to the
effect that the representations and warranties of the Company
contained in this Agreement are true and correct in all material
respects as of the Closing Date and that the Company has complied with
all of the agreements and satisfied all of the conditions on its part
to be performed or satisfied on or before the Closing Date. The
officer signing and delivering such certificate may rely upon the best
of such officer's knowledge as to proceedings threatened.
(c) The Manager shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer
of the Selling Stockholder, to the effect that the representations and
warranties of the Selling Stockholder contained in this Agreement are
true and correct in all material respects as of the Closing Date and
that the Selling Stockholder has complied with all of the agreements
and satisfied all of the conditions on its part to be performed or
satisfied on or before the Closing Date. The officer signing and
delivering such certificate may rely upon the best of such officer's
knowledge as to proceedings threatened.
(d) The Manager shall have received on the Closing Date an
opinion of counsel for the Company, dated the Closing Date, to the
effect set forth in Exhibit A.
(e) The Manager shall have received on the Closing Date an
opinion of counsel for the Selling Stockholder, dated the Closing
Date, to the effect set forth in Exhibit B.
(f) The Manager shall have received on the Closing Date an
opinion of counsel for the Underwriters, dated the Closing Date, to
the effect set forth in Exhibit C.
(g) The Manager shall have received on the Closing Date a
letter, dated the Closing Date, in form and substance satisfactory to
the Manager, from the Company's independent public accountants,
containing statements and information of the type ordinarily included
in accountants' "comfort
-7-
<PAGE>
letters" to underwriters with respect to the financial statements and
certain financial information contained in or incorporated by
reference into the Prospectus.
6. Covenants of the Company. In further consideration of the
------------------------
agreements of the Underwriters contained herein, the Company covenants as
follows:
(a) To furnish the Manager, without charge, a signed copy of the
Registration Statement (including exhibits thereto) and for delivery
to each other Underwriter a conformed copy of the Registration
Statement (without exhibits thereto) and, during the period mentioned
in paragraph (c) below, as many copies of the Prospectus, any
documents incorporated by reference therein and any supplements and
amendments thereto or to the Registration Statement as the Manager may
reasonably request.
(b) Prior to the termination of the offering of the Shares
pursuant to this Agreement, before amending or supplementing the
Registration Statement or the Prospectus with respect to the Shares,
to furnish to the Manager a copy of each such proposed amendment or
supplement and to file no such proposed amendment or supplement to
which the Manager reasonably objects promptly after reasonable notice
thereof; provided, however, that the foregoing shall not apply to any
-------- -------
of the Company's filings with the Commission required to be filed
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act,
copies of which filings the Company will cause to be delivered to the
Manager promptly after being transmitted for filing with the
Commission.
(c) If, during such period after the first date of the public
offering of the Shares as in the opinion of counsel for the
Underwriters the Prospectus is required by law to be delivered in
connection with sales by an Underwriter or dealer, any event shall
occur or condition exist as a result of which it is necessary to amend
or supplement the Prospectus in order to make the statements therein,
in the light of the circumstances when the Prospectus is delivered to
a purchaser, not misleading, or if, in the opinion of counsel for the
Underwriters or in the opinion of the Company, it is necessary to
amend or supplement the Prospectus to comply with law, forthwith to
prepare, file with the Commission and furnish, at its own expense, to
the Underwriters, and to the dealers (whose names and addresses the
Manager will furnish to the Company) to which Shares may have been
sold by the Manager on behalf of the Underwriters and to any other
dealer upon request, either amendments or supplements to the
Prospectus so that the statements in the Prospectus as so amended or
supplemented will not, in the light of the circumstances when the
Prospectus is delivered
-8-
<PAGE>
to a purchaser, be misleading or so that the Prospectus, as so amended
or supplemented, will comply with law.
(d) To endeavor to qualify the Shares for offer and sale under
the securities or Blue Sky laws of such jurisdictions as the Manager
shall reasonably request and to pay all expenses (including fees and
disbursements of counsel) in connection with such qualification and in
connection with any review of the offering of the Shares by the
National Association of Securities Dealers, Inc., provided that the
--------
Company shall not be obligated to so qualify the Shares if such
qualification requires it to file any general consent to service of
process or to register or qualify as a foreign corporation in any
jurisdiction in which it is not so registered or qualified.
(e) To make generally available to the Company's security
holders and to the Manager as soon as practicable an earning statement
covering a twelve-month period beginning on the first day of the first
full fiscal quarter after the date of this Agreement, which earning
statement shall satisfy the provisions of Section 11(a) of the
Securities Act and the rules and regulations of the Commission
thereunder.
7. Indemnification and Contribution. (a) The Company agrees
--------------------------------
to indemnify and hold harmless each Underwriter, the Selling Stockholder,
the directors of the Selling Stockholder and each person, if any, who
controls such Underwriter or the Selling Stockholder within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act
from and against any and all losses, claims, damages and liabilities caused
by any untrue statement or alleged untrue statement of a material fact
contained in the Registration Statement or any amendment thereof, any
preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments
-9-
<PAGE>
or supplements thereto), or caused by any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as such losses,
claims, damages or liabilities are caused by any such untrue statement or
omission or alleged untrue statement or omission based (i) upon information
relating to any Underwriter furnished to the Company in writing by such
Underwriter through the Manager expressly for use therein or (ii) upon
information relating to the Selling Stockholder furnished to the Company in
writing by the Selling Stockholder expressly for use therein; provided that
--------
the foregoing indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter from whom the
person asserting any such losses, claims, damages or liabilities purchased
Shares, or any person controlling such Underwriter, if a copy of the
Prospectus (as then amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) was not sent or given by
or on behalf of such Underwriter, to such person, if required by law so to
have been delivered, at or prior to the written confirmation of the sale of
the Shares to such person, and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such losses,
claims, damages or liabilities.
(b) The Selling Stockholder agrees to indemnify and hold
harmless each Underwriter, the Company, the directors of the Company, the
officers of the Company who sign the Registration Statement and each
person, if any, who controls such Underwriter or the Company within the
meaning of either Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the foregoing indemnity from the Company
to the Selling Stockholder, but in each case only with reference to such
information relating to the Selling Stockholder furnished to the Company by
the Selling Stockholder in writing expressly for use in the Registration
Statement, any preliminary prospectus, the Prospectus or any amendments or
supplements thereto; provided that the foregoing indemnity agreement with
--------
respect to any preliminary prospectus shall not inure to the benefit of any
Underwriter from whom the person asserting any such losses, claims, damages
or liabilities purchased Shares, or any person controlling such
Underwriter, if a copy of the Prospectus (as then amended or supplemented
if the Company shall have furnished any amendments or supplements thereto)
was not sent or given by or on behalf of such Underwriter, to such person,
if required by law so to have been delivered, at or prior to the written
confirmation of the sale of the Shares to such person, and if the
Prospectus (as so amended or supplemented) would have cured the defect
giving rise to such losses, claims, damages or liabilities.
(c) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company and the Selling Stockholder, each
of their directors, each of the officers of the Company who signs the
Registration Statement and each person, if any, who controls the Company or
the Selling Stockholder within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnities from the Company and the Selling Stockholder to such
Underwriter, but only with reference to information relating to such
Underwriter furnished to the Company by such Underwriter in writing through
the Manager expressly for use in the Registration Statement, any
preliminary prospectus, the Prospectus or any amendments or supplements
thereto.
(d) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to either of the three preceding
paragraphs, such person (the "indemnified party") shall promptly notify the
person against whom such
-10-
<PAGE>
indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in
such proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified party
shall have the right to retain its own counsel, but the fees and expenses
of such counsel shall be at the expense of such indemnified party unless
(i) the indemnifying party and the indemnified party shall have mutually
agreed to the retention of such counsel or (ii) the named parties to any
such proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in respect of the legal expenses of any
indemnified party in connection with any proceeding or related proceedings
in the same jurisdiction, be liable for the fees and expenses of more than
one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed
as they are incurred. Such firm acting on behalf of the indemnified
parties related to the Company shall be designated in writing by the
Company. Such firm acting on behalf of the indemnified parties related to
the Selling Stockholder shall be designated in writing by the Selling
Stockholder. Such firm acting on behalf of the indemnified parties related
to the Manager shall be designated in writing by the Manager. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or
if there be a final judgment for the plaintiff, the indemnifying party
agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment.
(e) If the indemnification provided for in paragraphs (a), (b)
or (c) of this Section 7 is unavailable to an indemnified party in respect
of any losses, claims, damages or liabilities referred to therein, then
each indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims,
damages or liabilities in such proportion as is appropriate to reflect the
relative benefits received by the indemnifying party or parties on the one
hand and the relative fault of the indemnifying party or parties on the
other hand in connection with the statements or omissions that resulted in
such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company
and the Selling Stockholder on the one hand and the Underwriters on the
other hand in connection with the offering of the Shares shall be deemed to
be in the same respective
-11-
<PAGE>
proportions as the net proceeds from the offering of such Shares (before
deducting expenses) received by the Selling Stockholder and the total
underwriting discounts and commissions received by the Underwriters, in
each case as set forth in the table on the cover of the Prospectus
Supplement, bear to the aggregate public offering price of the Shares. The
relative fault of the Company, the Selling Stockholder and the Underwriters
shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company, by the Selling Stockholder or by the Underwriters and the parties'
relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Underwriters'
respective obligations to contribute pursuant to this Section 7 are several
in proportion to the respective number of shares of Common Stock they have
purchased hereunder, and not joint.
(f) The Company, the Selling Stockholder and the Underwriters
agree that it would not be just or equitable if contribution pursuant to
this Section 7 were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other
method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or
claim. Notwithstanding the provisions of this Section 7, no Underwriter
shall be required to contribute any amount in excess of the amount by which
the total price at which the Shares underwritten by it and distributed to
the public were offered to the public exceeds the amount of any damages
that such Underwriter has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
remedies provided for in this Section 7 are not exclusive and shall not
limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
(g) The indemnity and contribution provisions contained in this
Section 7 and the representations and warranties of the Company and the
Selling Stockholder contained herein shall remain operative and in full
force and effect regardless of (i) any termination of this Agreement, (ii)
any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter or by or on behalf of the
-12-
<PAGE>
Company, its directors or officers or any person controlling the Company or
by or on behalf of the Selling Stockholder, its directors or any person
controlling the Selling Stockholder and (iii) acceptance of and payment for
any of the Shares.
8. Termination. This Agreement shall be subject to
-----------
termination, by notice given by the Manager to the Company and the Selling
Stockholder, if (a) after the execution and delivery of the Purchase
Agreement and prior to the Closing Date (i) trading in securities generally
on the New York Stock Exchange shall have been suspended or materially
limited, (ii) trading of any equity securities of the Company on the New
York Stock Exchange shall have been suspended, (iii) a general moratorium
on commercial banking activities in New York shall have been declared by
either Federal or New York State authorities or (iv) there shall have
occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis, which event is material and
adverse and (b) in the case of any of the events specified in clauses
(a)(i) through (iv), such event, singly or together with any other such
event, makes it, in the reasonable judgment of the Manager, impracticable
to market the Shares on the terms and in the manner contemplated in the
Prospectus.
9. Defaulting Underwriters. If, on the Closing Date, any one
-----------------------
or more of the Underwriters shall fail or refuse to purchase Shares that it
has or they have agreed to purchase hereunder on such date, and the
aggregate number of Shares which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase is not more than
one-tenth of the aggregate number of Shares to be purchased on such date,
the other Underwriters shall be obligated severally in the proportions that
the aggregate number of Shares set forth opposite their respective names in
the applicable Purchase Agreement bears to the aggregate number of Shares
set forth opposite the names of all such non-defaulting Underwriters, or in
such other proportions as the Manager may specify, to purchase the Shares
which such defaulting Underwriter or Underwriters agreed but failed or
refused to purchase on such date; provided that in no event shall the
--------
number of Shares that any Underwriter has agreed to purchase pursuant to
this Agreement be increased pursuant to this Section 9 by an amount in
excess of one-ninth of such number of Shares without the written consent of
such Underwriter. If, on the Closing Date, any Underwriter or Underwriters
shall fail or refuse to purchase Shares and the aggregate number of Shares
with respect to which such default occurs is more than one-tenth of the
aggregate number of Shares to be purchased on such date, and arrangements
satisfactory to the Manager and the Company and the Selling Stockholder for
the purchase of such Shares are not made within 36 hours after such
default, this Agreement shall terminate without liability on the part of
any non-defaulting Underwriter or the Company or the Selling Stockholder.
In any such case either the Manager or the Selling Stockholder shall
-13-
<PAGE>
have the right to postpone the Closing Date but in no event for longer than
seven days, in order that the required changes, if any, in the Registration
Statement and in the Prospectus or in any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve
any defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any
of them, because of any failure or refusal on the part of the Company or
the Selling Stockholder to comply with the terms or to fulfill any of the
conditions of this Agreement, or if for any reason (other than termination
due to the preceding paragraph or Section 8 hereof) the Company or the
Selling Stockholder shall be unable to perform its obligations under this
Agreement, the Company will reimburse the Underwriters or such Underwriters
as have so terminated this Agreement with respect to themselves, severally,
for all out-of-pocket expenses (including the fees and disbursements of
their counsel) reasonably incurred by such Underwriters in connection with
this Agreement or the offering of the Shares, provided that the Company and
--------
the Selling Stockholder shall have no further liability to any Underwriter
except as provided in Section 7 hereof and with respect to the payment of
expenses referred to in paragraph (d) of Section 6 hereof.
10. Miscellaneous. The Purchase Agreement may be signed in any
-------------
number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same
instrument.
This Agreement shall be governed by and construed in accordance
with the laws of the State of New York, regardless of the laws that might
otherwise govern under applicable New York principles of conflicts of law
and except as may otherwise be required by mandatory provisions of law.
11. Headings. The headings of the sections of this Agreement
--------
have been inserted for convenience of reference only and shall not be
deemed a part of this Agreement.
-14-
<PAGE>
Exhibit A
Opinion of
Counsel for the Company
The opinion of counsel for the Company, to be delivered pursuant
to Section 5(d) of the Purchase Agreement, shall be to the effect that:
(i) the Company has been duly incorporated, is validly
existing as a corporation in good standing under the laws of the State
of Delaware, has the corporate power and authority to own its property
and to conduct its business as described in the Prospectus and is duly
qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent
that the failure to be so qualified or be in good standing would not
have a material adverse effect on the financial condition or results
of operations of the Company and its subsidiaries, taken as a whole;
(ii) each Principal Operating Subsidiary has been duly
incorporated, is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has the
corporate power and authority to own its property and to conduct its
business as described in the Prospectus and is duly qualified to
transact business and is in good standing in each jurisdiction in
which the conduct of its business or its ownership or leasing of
property requires such qualification, except to the extent that the
failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and its subsidiaries, taken as
a whole;
(iii) (a) The authorized capital stock of the Company conforms
as to legal matters to the description thereof contained in the
Prospectus; (b) except for 51,750,000 shares of Class A Common Stock
of Nabisco, all of the outstanding capital stock of each of the
Principal Operating Subsidiaries is owned directly or indirectly by
the Company free and clear of any security interest, claim, lien or
other encumbrance or preemptive rights; and (c) except for (i) options
to acquire common stock of Nabisco granted to certain directors,
officers and employees of the Company and Nabisco and their
subsidiaries and (ii) the option granted to RJRN to acquire shares of
Class B Common Stock of Nabisco pursuant to the Corporate Agreement
between RJRN and Nabisco dated as of January 26, 1995 and the rights
of holders of the Class A Common Stock and Class B Common Stock of
Nabisco to convert their shares into shares of the other class in
<PAGE>
accordance with the Certificate of Incorporation of Nabisco under
certain circumstances, there are no outstanding rights (including,
without limitation, preemptive rights), warrants or options to
acquire, or instruments convertible into or exchangeable for, any
shares of capital stock or other equity interest in any of the
Principal Operating Subsidiaries or any contract, commitment,
agreement, understanding or arrangement of any kind relating to the
issuance of any such capital stock, any such convertible or
exchangeable securities or any such rights, warrants or options.
(iv) the Purchase Agreement has been duly authorized, executed
and delivered by the Company;
(v) the Shares have been duly authorized and are validly
issued, fully paid and nonassessable;
(vi) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, the Purchase
Agreement will not contravene any provision of applicable law or the
certificate of incorporation or by-laws of the Company or, to the best
of such counsel's knowledge, any agreement or other instrument binding
upon the Company or any of its subsidiaries or, to the best of such
counsel's knowledge, any judgment, order or decree of any governmental
body, agency or court having jurisdiction over the Company or any
subsidiary, except for such contraventions that would not have a
material adverse effect on the financial condition or results of
operations of the Company and its subsidiaries taken as a whole, and
no consent, approval, authorization or order of or qualification with
any governmental body or agency is required for the performance by the
Company of its obligations under the Purchase Agreement, except such
as have been obtained under the Securities Act and the Exchange Act
and except such as may be required by the securities or Blue Sky laws
of the various states or other jurisdictions in connection with the
offer and sale of the Shares;
(vii) the statements in the Prospectus under the caption
"Description of Holdings Capital Stock", insofar as such statements
constitute summaries of the legal matters or documents referred to
therein are accurate in all material respects;
(viii) after due inquiry, such counsel does not know of any legal
or governmental proceeding pending or threatened to which the Company
or any of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is subject that
is required to be described in the Registration Statement or the
Prospectus and is not so described or of any statutes, regulations,
contracts or
-2-
<PAGE>
other documents that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as required;
(ix) such counsel (1) is of the opinion that each document, if
any, filed pursuant to the Exchange Act and incorporated by reference
in the Registration Statement and Prospectus (except for financial
statements and schedules and financial and statistical data included
therein as to which such counsel need not express any opinion)
complied when so filed as to form in all material respects with the
Exchange Act and the rules and regulations of the Commission
thereunder, (2) has no reason to believe that (except for financial
statements and schedules and financial and statistical data as to
which such counsel need not express any belief) the Registration
Statement, on the date it became effective contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus (except as aforesaid),
contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein in the
light of the circumstances under which they were made, not misleading,
and (3) is of the opinion that the Registration Statement and
Prospectus (except for financial statements and schedules and
financial data included therein as to which such counsel need not
express any opinion) comply as to form in all material respects with
the Securities Act and the applicable rules and regulations of the
Commission thereunder.
In rendering such opinion, such counsel may rely as to certain
matters of fact on certificates of officers of the Company and of public
officials [and with respect to matters of [ ] law, on a member of
the Company's legal staff admitted to practice in the State of [ ]
and] may state that such counsel expresses no opinion as to the laws of any
jurisdiction other than the State of New York, the federal law of the
United States and the Delaware General Corporation Law.
The opinion of counsel for the Company (other than an opinion of
an officer of the Company) shall be rendered to you at the request of the
Company and shall so state therein.
With respect to paragraph (ix) above, counsel for the Company may
state that such counsel's opinion and belief are based upon such counsel's
participation in the preparation of the Registration Statement and
Prospectus and any amendments or supplements thereto and documents
incorporated therein by reference and review and discussion of the contents
thereof, but are without independent check or verification, except as
specified.
-3-
<PAGE>
Exhibit B
Opinion of
Counsel for the Selling Stockholder
The opinion of counsel for the Selling Stockholder, to be delivered
pursuant to Section 5(e) of the Purchase Agreement, shall be to the effect
that:
(i) the Selling Stockholder has been duly incorporated, is
validly existing as a corporation in good standing under the laws
of the State of [ ], has the corporate power and
authority to own its property and to conduct its business and is
duly qualified to transact business and is in good standing in
each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification,
except to the extent that the failure to be so qualified or be in
good standing would not have a material adverse effect on the
financial condition or results of operations of the Selling
Stockholder and its subsidiaries, taken as a whole;
(ii) the Purchase Agreement has been duly authorized,
executed and delivered by the Selling Stockholder;
(iii) the execution and delivery by the Selling Stockholder
of, and the performance by the Selling Stockholder of its
obligations under, the Purchase Agreement will not contravene any
provision of applicable law or the certificate of incorporation
or by-laws of the Selling Stockholder or any agreement or other
instrument listed or referred to in Items 4 and 10 of the
exhibits to the Selling Stockholder's Annual Report on Form 10-K
for the fiscal year ended December 31, 1993 or, to the best of
such counsel's knowledge, any judgment, order or decree of any
governmental body, agency or court having jurisdiction over the
Selling Stockholder or any subsidiary, except for contraventions
that would not have a material adverse effect on the financial
condition or results of operations of the Selling Stockholder and
its subsidiaries taken as a whole, and no consent, approval,
authorization or order of or qualification with any governmental
body or agency is required for the performance by the Selling
Stockholder of its obligations under the Purchase Agreement,
except such as have been obtained and except such as may be
required by the securities or Blue Sky laws of the various states
or other jurisdictions in connection with the offer and sale of
the Shares.
<PAGE>
(iv) Immediately prior to the delivery of the certificates
for the Shares at the Closing Date, the Selling Stockholder was
the sole registered owner of the Shares and the Selling
Stockholder had full power, right and authority to sell the
Shares; assuming the Underwriters purchase the Shares in good
faith and without notice of any adverse claim, upon delivery by
the Selling Stockholder to the Underwriters of certificates for
the Shares against payment therefor as provided in the Purchase
Agreement, the Underwriters will acquire all of the rights of the
Selling Stockholder in the Shares free of any adverse claim.
In rendering such opinion, such counsel may rely as to certain
matters of fact on certificates of officers of the Selling Stockholder and
of public officials [and with respect to matters of [ ] law, on a
member of the Selling Stockholder's legal staff or on such counsel as it
believes to be reliable as to such matters] and may state that such counsel
expresses no opinion as to the laws of any jurisdiction other than the
State of New York and the federal law of the United States.
The opinion of counsel for the Selling Stockholder (other than an
opinion of an officer of the Selling Stockholder) shall be rendered to you
at the request of the Selling Stockholder and shall so state therein.
-2-
<PAGE>
Exhibit C
Opinion of
Counsel for the Underwriters
The opinion of counsel for the Underwriters, to be delivered
pursuant to Section 5(f) of the Purchase Agreement, shall be to the effect
that:
(i) the Purchase Agreement has been duly authorized, executed
and delivered by the Company;
(ii) the statements in the Prospectus under the caption
"Description of Holdings Capital Stock", insofar as such statements
constitute summaries of the legal matters or documents referred to
therein, are accurate in all material respects; and
(iii) (1) nothing has come to such counsel's attention to cause
such counsel to believe that (except for financial statements and
schedules as to which such counsel need not express any belief) each
part of the Registration Statement, when such part became effective
contained, and as of the date such opinion is delivered, contains any
untrue statement of a material fact or, when such part became
effective, omitted or, as of the date such opinion is delivered, omits
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, (2) such counsel is of the
opinion that the Registration Statement and Prospectus (except for
financial statements and schedules and financial and statistical data
included therein as to which such counsel need not express any
opinion) comply as to form in all material respects with the
Securities Act and the applicable rules and regulations of the
Commission thereunder and (3) nothing has come to such counsel's
attention to cause such counsel to believe that (except for financial
statements and schedules and financial and statistical data as to
which such counsel need not express any belief) the Prospectus as of
the date such opinion is delivered contains any untrue statement of a
material fact or omits to state a material fact necessary in order to
make the statements therein, in light of the circumstances under which
they were made, not misleading.
With respect to clause (iii) above, such counsel may state that
their opinion and belief are based upon their participation in the
preparation of the Registration Statement and the Prospectus and any
amendments or supplements thereto (other than the documents incorporated by
reference) and upon review and discussion of the contents thereof
(including documents incorporated by reference) but are without independent
check or verification, except as specified.
<PAGE>
PURCHASE AGREEMENT
________, 199_
RJR NABISCO HOLDINGS CORP.
1301 Avenue of the Americas
New York, New York 10019
[Selling Stockholder]
[Address]
Dear Ladies and Gentlemen:
We (the "Manager") are acting on behalf of the underwriter or
underwriters (including ourselves) named below (such underwriter or
underwriters being herein called the "Underwriters"), and we understand
that [ ], a [ ] corporation (the "Selling Stockholder"),
proposes to sell ______ shares of Common Stock (par value $.01 per share)
of RJR NABISCO HOLDINGS CORP. (the "Shares").
Subject to the terms and conditions set forth or incorporated by
reference herein, the Selling Stockholder hereby agrees to sell and the
Underwriters agree to purchase, severally and not jointly, the respective
number of Shares set forth below opposite their names at a purchase price
of $_____ per share.
Name Number of Shares
---- ----------------
The Underwriters will pay for the Shares upon delivery thereof at the
offices of Davis Polk & Wardwell at 10:00 a.m. (New York time) on
[ ], 199_, or at such other time, not later
<PAGE>
than __:00 p.m. (New York time) on [ ], 199_, as shall be agreed
upon in writing by the Manager and the Selling Stockholder. The time and
date of such payment and delivery are hereinafter referred to as the
Closing Date.
The Shares have the terms set forth in the Prospectus dated
[ ], 199_, and the Prospectus Supplement dated [ ], 199_,
including the following:
All provisions contained in the document entitled RJR
NABISCO HOLDINGS CORP./BORDEN, INC. Purchase Agreement Standard
Provisions For Secondary Offering (Common Stock) dated [
], 199_, a copy of which is attached hereto, are herein
incorporated by reference in their entirety and shall be deemed
to be a part of this Agreement to the same extent as if such
provisions had been set forth in full herein.
Please confirm your agreement by having an authorized officer
sign a copy of this Agreement in the space set forth below.
Very truly yours,
[MANAGING UNDERWRITERS]
Acting severally on behalf of
themselves and the several
Underwriters named herein
By: [Managing Underwriters]
By:_________________________
Name:
Title:
Accepted:
[Selling Stockholder]
By:_________________________
Name:
Title:
RJR NABISCO HOLDINGS CORP.
By:_________________________
Name:
Title:
-2-
EXHIBIT 5.1
March 15, 1995
RJR Nabisco Holdings Corp.
1301 Avenue of the Americas
New York, New York 10019
Ladies and Gentlemen:
I have acted as counsel for RJR Nabisco Holdings Corp., a
Delaware corporation (the "Company"), in connection with the Registration
Statement on Form S-3 of the Company, filed with the Securities and
Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Securities Act"), relating to the registration of 111,047,230
shares of the Company's Common Stock, par value $.01 per share (the
"Shares"), to be sold from time to time by Borden, Inc. (the "Selling
Stockholder") as described in the Registration Statement.
I have examined the Registration Statement and the exhibits
thereto and the Amended and Restated Certificate of Incorporation of the
Company, as further amended. I have also examined originals or copies,
certified or otherwise identified to my satisfaction, of such documents,
evidences of corporate action and other instruments and have made such
other investigations of law and fact as I have deemed necessary or
appropriate for the purposes of this opinion. As to questions of fact
relevant to this opinion, I have relied upon certificates or
<PAGE>
RJR Nabisco Holdings
Corp. -2- March 15, 1995
written statements from officers and other appropriate representatives of
the Company and its subsidiaries or public officials. In all such
examinations I have assumed the genuineness of all signatures, the
authority to sign, and the authenticity of all documents submitted to me as
originals. I have also assumed the conformity with originals of all
documents submitted to me as copies.
Based upon and subject to the foregoing, and to the
qualifications hereinafter specified, I am of the opinion that the Shares
have been duly authorized and are validly issued, fully paid and
nonassessable.
The opinion set forth herein relates solely to the General
Corporation Law of the State of Delaware.
I hereby consent to the filing of this opinion as an exhibit to
the Registration Statement and to the use of my name under the heading
"Legal Matters" in the Prospectus forming a part of the Registration
Statement.
Very truly yours,
/s/ Jo-Ann Ford
Jo-Ann Ford
Senior Vice President, Law
and Secretary
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of RJR Nabisco Holdings Corp. ("Holdings") on Form S-3 (the
"Registration Statement") of our report dated January 30, 1995 (except with
respect to Notes 11 and 17, as to which the date is February 21, 1995),
appearing in the Annual Report on Form 10-K of Holdings for the year ended
December 31, 1994.
We also consent to the reference to us under the headings "Summary
Historical Consolidated Financial Data" and "Experts" in the Prospectus,
which is part of this Registration Statement.
/s/ DELOITTE & TOUCHE LLP
DELOITTE & TOUCHE LLP
New York, New York
March 15, 1995
EXHIBIT 24.1
POWER OF ATTORNEY
-----------------
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned, being a
director or officer, or both, of RJR NABISCO HOLDINGS CORP., a Delaware
corporation (the "Company"), do hereby make, constitute and appoint Jo-Ann
Ford and David F. Sternlieb, and either of them, attorneys-in-fact and agents of
the undersigned with full power and authority of substitution and
resubstitution, in any and all capacities, to execute for and on behalf of
the undersigned the Registration Statement on Form S-3 relating to the
registration and offering of shares of common stock of the Company by
Borden, Inc., and any and all pre-effective and post-effective amendments
or supplements to the foregoing Registration Statement and any other
documents and instruments incidental thereto, and to deliver and file the
same, with all exhibits thereto, and all documents and instruments in
connection therewith, with Securities and Exchange Commission, and with
each exchange on which any class of securities of the Company is
registered, granting unto said attorneys-in-fact and agents, and each of
them, full power and authority to do and perform each and every act and
thing that said attorneys-in-fact and agents, and each of them, deem
advisable or necessary to enable the Company to effectuate the intents and
purposes hereof, and the undersigned hereby fully ratify and confirm all
that said attorneys-in-fact and agents, or any of them, or their or his or
her substitute or substitutes, shall do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, each of the undersigned has subscribed his or her
name, this 15th day of March, 1995.
/s/ Charles M. Harper Chairman of the Board and Chief
- ----------------------
Charles M. Harper Executive Officer, Director
/s/ Stephen R. Wilson Executive Vice President and Chief
- ----------------------
Stephen R. Wilson Financial Officer
/s/ Robert S. Roath Senior Vice Present and Controller
- ----------------------
Robert S. Roath
/s/ John T. Chain, Jr. Director
- ----------------------
John T. Chain, Jr.
<PAGE>
2
/s/ Julius L. Chambers Director
- ----------------------
Julius L. Chambers
/s/ John L. Clendenin Director
- ----------------------
John L. Clendenin
/s/ James H. Greene, Jr. Director
- ------------------------
James H. Greene, Jr.
/s/ H. John Greeniaus Director
- ----------------------
H. John Greeniaus
/s/ James W. Johnston Director
- ----------------------
James W. Johnston
/s/ Henry R. Kravis Director
- ----------------------
Henry R. Kravis
/s/ John G. Medlin, Jr. Director
- -----------------------
John G. Medlin, Jr.
/s/ Paul E. Raether Director
- ----------------------
Paul E. Raether
/s/ Lawrence R. Ricciardi Director
- -------------------------
Lawrence R. Ricciardi
/s/ Rozanne L. Ridgway Director
- ----------------------
Rozanne L. Ridgway
/s/ Clifton S. Robbins Director
- ----------------------
Clifton S. Robbins
/s/ George R. Roberts Director
- ----------------------
George R. Roberts
/s/ Scott M. Stuart Director
- ----------------------
Scott M. Stuart
/s/ Michael T. Tokarz Director
- ----------------------
Michael T. Tokarz
