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SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2)
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[X] Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12
RJR Nabisco Holdings Corp.
(Name of Registrant as Specified In Its Charter)
RJR Nabisco Holdings Corp.
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction
computed pursuant to Exchange Act Rule 0-11:
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[x] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by
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RJR
Nabisco logo News Release
Contact: Jason Wright Carol Makovich
(212) 258-5770 (212) 258-5785
RJR NABISCO BOARD ADOPTS POLICY TO
INCREASE CASH RETURNS TO SHAREHOLDERS
NEW YORK, NEW YORK -- March 5, 1996 -- RJR Nabisco Holdings Corp. (NYSE:RN)
today announced that the company's board of directors has voted to adopt a
policy to return a greater share of its free cash flows to shareholders.
Additionally, the board voted to reaffirm its continued commitment to a
responsible spin-off of the company's 80.5 percent interest in Nabisco at the
earliest possible time and voted to make an important change in board
structure. The company said its free cash flow policy will result in two
immediate actions:
bullet a 23% increase in the company's annual common dividend, to $1.85 per
common share from $1.50 per common share; and
bullet the adoption of a share repurchase objective of approximately 10
million common shares over the next several years based on the
achievement of performance targets, and the authorization by the
board for the company to repurchase up to $100 million of stock in
1996.
RJR Nabisco said the board also voted to form a new corporate
governance and nominating committee of the board, consisting solely of outside
directors. The new committee will be charged with reviewing and recommending
changes to board affairs, including director compensation, and recruiting
additional outside directors.
"Over the past three months, I have met personally with each of our
major, long-term shareholders," said Steven F. Goldstone, RJR Nabisco's
president and chief executive officer. "Each one expressed concern about the
performance of this company's stock and our need to deliver on our commitments
to improve operating results.
"That message came through loud and clear in the recent consent
solicitation," Mr. Goldstone said. "I have no doubt that a large number of
our shareholders want the board and management to take immediate action to
improve the performance of their investment, including finding a responsible
way to spin-off Nabisco as soon as we can.
"The actions we are taking today mark an important step in our effort
to add real value to our shareholders' investment," Mr. Goldstone continued.
"I want shareholders to know, however, that this is not the last step. I
speak for every member of our board of directors in saying we are committed to
spinning off Nabisco as soon as we believe that it can be done successfully.
Implementing a spin-off will remain a 'front-burner' issue for RJR Nabisco."
RJR Nabisco said the board decided on the level of dividend payout
and share repurchase authorization for 1996 based on its analysis of the
company's current financial obligations and the outlook for sustainable
earnings performance by the company's operating businesses.
"Although cash expenditures for restructurings to improve the
performance of the tobacco businesses will limit free cash flow in the early
part of this year, we still expect to generate significant free cash flow this
year and in the coming years," Mr. Goldstone said. "We recognize the
tremendous earnings potential that can be put to work for our shareholders in
the form of dividend increases and share repurchases. The improving outlook
for our businesses and the elimination of some preferred dividend obligations
in 1997 make us comfortable that these policies are sustainable."
Dividend Increase
RJR Nabisco said the board increased the quarterly common dividend to
$.4625 per common share from $.375 per common share. The dividend is payable
April 1, 1996 to shareholders of record March 15, 1996. The company said the
increase in the dividend rate was equivalent to the amount of dividend income
the company currently receives from its 80.5 percent interest in Nabisco
Holdings Corp.
"In raising the dividend to this level, we considered two primary
factors: the dividend income the company receives from its 80.5 percent
interest in Nabisco, and the performance of the tobacco business," Mr.
Goldstone said. "We believe this approach is a responsible means of allowing
our shareholders to participate in the dividend income the company receives
from its Nabisco interest until we can achieve a spin-off."
Share Repurchases
RJR Nabisco said that the 10-million share repurchase objective over
the next few years would be tied to the realization of the company's operating
plans. The board authorized the company to repurchase up to $100 million of
its common stock in the open market in 1996, from time to time as market
conditions permit and as the company's operating plan for the current year is
achieved. Mr. Goldstone said the board intends to regularly review
repurchases to determine what level of additional activity might be
appropriate, based on improving cash flows and other financial results.
New Board Committee
The company said the board voted to form a new corporate governance
and nominating committee that will assume responsibility for reviewing
corporate governance issues, recommending changes to director compensation and
incentive policy, and recruiting and nominating new directors. Only outside
directors of the company will be members of the committee, which will be
chaired by Ambassador Rozanne Ridgway, co-chair of the Atlantic Council of the
United States.
"Over the past 18 months, RJR Nabisco has evolved from a company
controlled by one leveraged buyout investment group to a company with broad
common stock ownership," said Ambassador Ridgway. "The new corporate
governance and nominating committee will provide the board with a formal means
of determining what additional steps are necessary to complete the company's
transition as well as to step up our efforts to recruit additional outside
directors."
CERTAIN ADDITIONAL INFORMATION: RJR Nabisco Holdings Corp. will be soliciting
proxies against the director nominees of Brooke Group Ltd. and other
shareholder proposals. The following individuals may be deemed to be
participants in the solicitation of proxies by RJR Nabisco Holdings Corp.:
RJR Nabisco Holdings Corp.; John T. Chain, Jr.; Julius L. Chambers; John L.
Clendenin; Steven F. Goldstone; H. John Greeniaus; Ray J. Groves; Charles M.
Harper, James W. Johnston; John G. Medlin, Jr.; Robert S. Roath; Rozanne L.
Ridgway; Robert F. Sharpe, Jr.; and Huntley R. Whitacre. As of February 1,
1996, Mr. Chain is the beneficial owner of 8,859 shares of the company's
common stock; Mr. Chambers is the beneficial owner of 6,888 shares of the
company's common stock; Mr. Clendenin is the beneficial owner of 7,312 shares
of the company's common stock; Mr. Goldstone is the beneficial owner of 16,532
shares of the company's common stock; Mr. Greeniaus is the beneficial owner of
126,390 shares of the company's common stock; Mr. Groves is the beneficial
owner of 7,466 shares of the company's common stock; Mr. Harper is the
beneficial owner of 524,955 shares of the company's common stock; Mr. Johnston
is the beneficial owner of 114,463 shares of the company's common stock; Mr.
Medlin is the beneficial owner of 7,725 shares of the company's common stock;
Mr. Roath is the beneficial owner of 38,435 shares of the company's common
stock; Ms. Ridgway is the beneficial owner of 6,859 shares of the company's
common stock; Mr. Sharpe is the beneficial owner of 37,276 shares of the
company's common stock; and Mr Whitacre is the beneficial owner of 29,464
shares of the company's common stock.
