-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, VtQXyy/TBoMWtFzD8+h/9ZxoF/SJi+CKL9Rq1LiG143DpwGkX5mE6VBYgcGlAvOi KlurNaIVvpRNqiIXLGvNDg== 0000950136-96-001181.txt : 19961210 0000950136-96-001181.hdr.sgml : 19961210 ACCESSION NUMBER: 0000950136-96-001181 CONFORMED SUBMISSION TYPE: SC 14D1/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 19961209 SROS: NYSE GROUP MEMBERS: ATLANTIC ACQUISITION CORPORATION GROUP MEMBERS: NORFOLK SOUTHERN CORP SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: CONRAIL INC CENTRAL INDEX KEY: 0000897732 STANDARD INDUSTRIAL CLASSIFICATION: RAILROADS, LINE-HAUL OPERATING [4011] IRS NUMBER: 232728514 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D1/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-42777 FILM NUMBER: 96677940 BUSINESS ADDRESS: STREET 1: TWO COMMERCE SQ STREET 2: P O BOX 41417 CITY: PHILADELPHIA STATE: PA ZIP: 19101-1417 BUSINESS PHONE: 2152094434 MAIL ADDRESS: STREET 1: P.O. BOX 41429 STREET 2: 2001 MARKET STREET CITY: PHILADELPHIA STATE: PA ZIP: 19101-1429 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: NORFOLK SOUTHERN CORP CENTRAL INDEX KEY: 0000702165 STANDARD INDUSTRIAL CLASSIFICATION: RAILROADS, LINE-HAUL OPERATING [4011] IRS NUMBER: 521188014 STATE OF INCORPORATION: VA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 14D1/A BUSINESS ADDRESS: STREET 1: THREE COMMERCIAL PL CITY: NORFOLK STATE: VA ZIP: 23510-2191 BUSINESS PHONE: 8046292680 SC 14D1/A 1 AMENDMENT TO SCHEDULE 14D-1 - ------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------- SCHEDULE 14D-1 (AMENDMENT NO. 17) TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1) OF THE SECURITIES EXCHANGE ACT OF 1934 --------- CONRAIL INC. (NAME OF SUBJECT COMPANY) NORFOLK SOUTHERN CORPORATION ATLANTIC ACQUISITION CORPORATION (Bidders) COMMON STOCK, PAR VALUE $1.00 PER SHARE (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) (Title of Class of Securities) 208368 10 0 (CUSIP Number of Class of Securities) SERIES A ESOP CONVERTIBLE JUNIOR PREFERRED STOCK, WITHOUT PAR VALUE (INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS) (Title of Class of Securities) NOT AVAILABLE (CUSIP Number of Class of Securities) --------- JAMES C. BISHOP, JR. EXECUTIVE VICE PRESIDENT-LAW NORFOLK SOUTHERN CORPORATION THREE COMMERCIAL PLACE NORFOLK, VIRGINIA 23510-2191 TELEPHONE: (757) 629-2750 (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications on Behalf of Bidder) --------- with a copy to: RANDALL H. DOUD, ESQ. SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP 919 THIRD AVENUE NEW YORK, NEW YORK 10022 TELEPHONE: (212) 735-3000 - ------------------------------------------------------------------------------- This Amendment No. 17 amends the Tender Offer Statement on Schedule 14D-1 filed on October 24, 1996, as amended (the "Schedule 14D-1"), by Norfolk Southern Corporation, a Virginia corporation ("Parent"), and its wholly owned subsidiary, Atlantic Acquisition Corporation, a Pennsylvania corporation ("Purchaser"), relating to Purchaser's offer to purchase all outstanding shares of (i) Common Stock, par value $1.00 per share (the "Common Shares"), and (ii) Series A ESOP Convertible Junior Preferred Stock, without par value (the "ESOP Preferred Shares" and, together with the Common Shares, the "Shares"), of Conrail Inc. (the "Company"), including, in each case, the associated Common Stock Purchase Rights, upon the terms and subject to the conditions set forth in the Offer to Purchase, dated October 24, 1996 (the "Offer to Purchase"), as amended and supplemented by the Supplement thereto, dated November 8, 1996 (the "Supplement"), and in the revised Letter of Transmittal (which, together with any amendments or supplements thereto, constitute the "Offer"). Unless otherwise defined herein, all capitalized terms used herein shall have the respective meanings given such terms in the Offer to Purchase, the Supplement or the Schedule 14D-1. ITEM 11. MATERIAL TO BE FILED AS EXHIBITS. Item 11 is hereby amended and supplemented by the following: (a)(52) Press Release issued by Parent on December 8, 1996. (a)(53) Parent's Proxy Statement Supplement, including attached letter to the Company's shareholders, mailed to the Company's shareholders commencing December 9, 1996. SIGNATURE After due inquiry and to the best of its knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct. Dated: December 9, 1996 NORFOLK SOUTHERN CORPORATION By: /s/ JAMES C. BISHOP, JR. ------------------------ Name: James C. Bishop, Jr. Title: Executive Vice President-Law ATLANTIC ACQUISITION CORPORATION By: /s/ JAMES C. BISHOP, JR. ---------------------------- Name: James C. Bishop, Jr. Title: Vice President and General Counsel EXHIBIT INDEX Exhibit Number Description - ------ ----------- (a)(52) Press Release issued by Parent on December 8, 1996. (a)(53) Parent's Proxy Statement Supplement, including attached letter to the Company's shareholders, mailed to the Company's shareholders commencing December 9, 1996. EX-99.A(52) 2 PRESS RELEASE FOR IMMEDIATE RELEASE - --------------------- DECEMBER 8, 1996 Media Contact: Robert Fort 757 629-2714 NS ISSUES PLEDGE TO CR SHAREHOLDERS NORFOLK, VA -- Norfolk Southern today confirmed its commitment to Conrail shareholders by pledging that it will not be a party to any agreement with CSX or Conrail that delivers anything less to Conrail shareholders than $110 a share in cash, for all shares, promptly into a voting trust. The pledge is contained in a letter from David R. Goode, NS chairman, president and chief executive officer, that will be sent to Conrail shareholders on Monday. "The only way Conrail shareholders are going to see our superior, all cash offer is if they force their management to honor shareholder wishes," Goode said. "As things now stand, Conrail management is denying its own shareholders the benefits of our $110, all cash offer for all shares, which is nearly 19 percent higher than the part cash, part stock CSX offer." Conrail has called for a shareholder vote at a meeting set for 5 p.m. on December 23. However, it has already declared that it won't convene the meeting unless it has enough votes to assure approval of its proposal to opt out of the Pennsylvania Fair Value Statute, and to adjourn the special meeting. It said that it will continue to set new shareholder meetings until Conrail shareholders approve its proposal. "This arrogant denial of basic shareholder rights is an outrage," Goode said. Goode stressed that the NS pledge also contained an important message for both CSX management and CSX shareholders. "CSX management should have no doubt as to our determination to acquire Conrail and our willingness to use any and all appropriate financial means to accomplish that objective," the NS chairman said. "For CSX shareholders, we repeat our willingness to create today with CSX and Conrail a structure for Eastern railroad service that will enable both of our companies to prosper in a competitive environment," Goode noted, "but this will be accomplished only pursuant to a $110 all cash offer for all shares into a voting trust. Such an offer would benefit the shareholders of all three companies. "However, Conrail shareholders must vote 'no' in order to make this happen," Goode said. ### World Wide Web Site - http://www.nscorp.com EX-99.A(53) 3 PROXY STATEMENT [NORFOLK SOUTHERN LOGO] December 9, 1996 Dear Conrail Shareholder: On November 4, Norfolk Southern began soliciting your vote AGAINST a proposal by Conrail's Board of Directors to amend the Conrail charter to "opt out" of Subchapter E of Chapter 25 of the Pennsylvania Business Corporation Law. On November 8, we increased the amount payable in our cash tender offer for Conrail shares from $100 per share to $110 per share. TODAY WE MAKE THE FOLLOWING PLEDGE TO YOU AND ALL CONRAIL SHAREHOLDERS: NORFOLK SOUTHERN WILL NOT BE A PARTY TO ANY AGREEMENT WITH CSX OR CONRAIL THAT DELIVERS ANYTHING LESS TO CONRAIL SHAREHOLDERS THAN A $110 ALL-CASH, ALL-SHARES OFFER WITH PROMPT PAYMENT THROUGH USE OF A VOTING TRUST SO LONG AS CONRAIL SHAREHOLDERS REJECT THE MANEUVERING BY CSX AND CONRAIL'S MANAGEMENT TO PAY YOU LESS THAN YOU DESERVE FOR YOUR SHARES -which you can do by voting now on Norfolk Southern's GOLD proxy card AGAINST Conrail's proposals to "opt out" of Pennsylvania's Fair Value Statute and to adjourn the special meeting. That's the only way to stop Conrail's management and CSX from denying you the benefits of Norfolk Southern's superior all-cash offer for all shares which is worth almost 19% more than CSX's part cash, part stock offer.(1) THE FUTURE VALUE OF YOUR CONRAIL INVESTMENT IS IN YOUR HANDS DON'T BE COERCED INTO ACCEPTING LESS THAN FULL VALUE FOR YOUR CONRAIL SHARES. VOTE TODAY ON THE GOLD PROXY CARD AGAINST CONRAIL'S PROPOSALS TO "OPT OUT" OF PENNSYLVANIA'S FAIR VALUE STATUTE AND TO ADJOURN THE SPECIAL MEETING. Even if you have tendered your shares into CSX's new offer or voted earlier, you can still vote those shares against the "opt out" amendment by signing and returning the GOLD proxy card. You must act now to protect the value of your Conrail investment. Sincerely, /s/ David R. Goode David R. Goode Chairman, President and Chief Executive Officer IMPORTANT If you have any questions, please call our solicitor: [GEORGESON AND COMPANY INC. LOGO] CALL TOLL FREE: 800-223-2064 Banks and Brokers call: 212-440-9800 - ------------ (1) Based on the closing price of CSX common stock on December 6, 1996. SPECIAL MEETING OF SHAREHOLDERS OF CONRAIL INC. -------------------- PROXY STATEMENT SUPPLEMENT of NORFOLK SOUTHERN CORPORATION -------------------- SOLICITATION OF PROXIES IN OPPOSITION TO THE PROPOSED AMENDMENT TO THE ARTICLES OF INCORPORATION OF CONRAIL INC. INTRODUCTION This Proxy Statement Supplement (this "Supplement") is furnished by Norfolk Southern Corporation ("Norfolk Southern") and relates to a Special Meeting of Shareholders of Conrail Inc. ("Conrail" or the "Company") to vote upon Conrail's proposal (the "Amendment Proposal") to amend its Articles of Incorporation to "opt out" of Subchapter E (the "Fair Value Statute") of Chapter 25 of the Pennsylvania Business Corporation Law of 1988, as amended, and to any adjournments, postponements or reschedulings thereof (the "Special Meeting"). This Supplement amends and supplements, to the extent set forth herein, the Proxy Statement of Norfolk Southern, dated November 4, 1996, which was first mailed to Conrail Shareholders on or about November 4, 1996 and which was subsequently amended and supplemented by a proxy supplement dated November 8, 1996 (as amended to date, the "Proxy Statement"). Capitalized terms used in this Supplement and not otherwise defined in this Supplement shall have the respective meanings assigned to such terms in the Proxy Statement. This Supplement is first being mailed to Conrail Shareholders on or about December 9, 1996. RECENT DEVELOPMENTS THE SPECIAL MEETING On November 25, 1996, Conrail publicly announced that the Special Meeting had now been scheduled for December 23, 1996, and would be held at The Academy of Music Hall, 1420 Locust Street, Philadelphia, Pennsylvania, at 5:00 p.m. Eastern Standard Time. According to Conrail's proxy statement, the Record Date for the Special Meeting is December 5, 1996. Norfolk Southern is soliciting proxies from Conrail Shareholders to vote AGAINST both (i) the Amendment Proposal and (ii) Conrail's proposal to adjourn (the "Adjournment Proposal") the Special Meeting, if necessary, to permit Conrail to further solicit proxies in the event that there are not sufficient votes at the time of the Special Meeting to approve the Amendment Proposal. The proxy cards previously furnished to you by Norfolk Southern remain valid for Shareholders entitled to vote at the Special Meeting. Nonetheless, new GOLD proxy cards are being provided to you with this Supplement to vote AGAINST both the Amendment Proposal and the Adjournment Proposal. ESOP Participants can instruct the ESOP Trustee to vote their ESOP shares AGAINST the Amendment Proposal on the enclosed GREEN instruction card. In addition, if you have already voted Conrail's white proxy card (or GREEN instruction card) in favor of the Amendment Proposal, you may revoke that vote by completing and returning the GOLD proxy (or GREEN instruction card) and indicating your vote AGAINST the Amendment Proposal. It's the latest dated proxy which will be counted. PLEASE SIGN AND DATE THE ENCLOSED GOLD PROXY CARD OR GREEN INSTRUCTION CARD TODAY AND VOTE AGAINST THE "OPT OUT" AMENDMENT. 1 SUMMARY OF THE CSX SECOND TENDER OFFER On December 6, 1996, CSX announced the commencement of a second tender offer for 18,344,845 Shares (representing approximately 20% of the outstanding Shares) at a price of $110 per Share (the "CSX Second Offer"). The CSX Second Offer is scheduled to expire on January 6, 1997. CSX has conditioned the CSX Second Offer on, among other things, Shareholder approval of the Amendment Proposal. SPECIAL NOTICE TO ESOP PARTICIPANTS VOTING OF ESOP UNALLOCATED SHARES Based upon publicly available information, the ESOP Trust currently holds approximately 7.3 million ESOP Preferred Shares and, prior to the completion of the first CSX Tender Offer, approximately 2.1 million ESOP Preferred Shares were allocated to individual shareholder-participants' ("ESOP Participants") accounts pursuant to the ESOP. Assuming that all such allocated ESOP Preferred Shares were tendered to CSX and approximately 490,871 were accepted for payment by CSX, Norfolk Southern estimates that approximately 1.6 million ESOP Preferred Shares are currently allocated to ESOP Participants' accounts. The remaining shares are held in an ESOP suspense account (the "Unallocated ESOP Shares"). In accordance with the ESOP trust agreement between Consolidated Rail Corporation and Fidelity Management Trust Company, as trustee (the "Trustee") of the ESOP Preferred Shares, the Trustee is obligated, except under certain circumstances, to vote the ESOP Preferred Shares credited to ESOP Participants' accounts in accordance with their instructions, and will vote the ESOP Preferred Shares credited to the ESOP Participants' accounts for which it does not receive timely instructions and the Unallocated Shares in the same proportion as the ESOP Preferred Shares for which valid instruction are received from ESOP Participants. IN EFFECT, EACH ESOP PREFERRED SHARE COULD DIRECT THE VOTING OF MORE THAN 4.5 ESOP PREFERRED SHARES BY THE TRUSTEE IN ACCORDANCE WITH THE INSTRUCTIONS GIVEN. IN ADDITION, BECAUSE IT IS LIKELY THAT NOT ALL ESOP PARTICIPANTS WILL GIVE VOTING INSTRUCTIONS, THE ESOP PARTICIPANTS WHO DO VOTE WILL BE DIRECTING THE VOTING OF AN EVEN GREATER NUMBER OF SHARES. AS A RESULT OF THIS "SUPER-VOTING" ABILITY, IT IS ESPECIALLY IMPORTANT FOR EACH HOLDER OF ESOP PREFERRED SHARES TO PROPERLY INSTRUCT THE TRUSTEE AS TO HOW THE ESOP PARTICIPANT WANTS ESOP PREFERRED SHARES ALLOCATED TO HIS OR HER ACCOUNT TO BE VOTED. Holders of ESOP Preferred Shares cannot instruct the Trustee how to vote those shares by completing the gold proxy card -they can only instruct the Trustee as to how to vote their ESOP Preferred Shares by completing the GREEN INSTRUCTION card provided with this Supplement. VOTING INSTRUCTIONS WILL BE TREATED CONFIDENTIALLY BY THE TRUSTEE. VOTING OF EMPLOYEE BENEFITS TRUST Based upon publicly available information, Norfolk Southern estimates that approximately 4.3 million Common Shares are held in the Conrail Employee Benefits Trust (the "EBT"). Based on the terms of the trust agreement, the trustee of the EBT must follow the directions of the ESOP Participants with respect to the manner of voting the Common Shares held in the Employee Benefits Trust on each matter pending before an annual or special meeting of Shareholders. Consequently, not only will each ESOP Preferred Share voted direct the vote of more than 4.5 ESOP Preferred Shares, but it will also direct the vote of more than 2.5 additional Common Shares held in the EBT. PASS THROUGH VOTING PROCEDURE FOR NON-VOTING SHARES As discussed above, all ESOP Preferred Shares that have been allocated to ESOP Participants' accounts but as to which no voting instructions have been received by the Trustee will be voted in the same proportion as are the ESOP Preferred Shares for which valid instructions have been received. This means that if an ESOP Participant does not instruct the Trustee regarding the voting of his or her allocated ESOP Preferred Shares, those allocated ESOP Preferred Shares will be voted based upon the voting percentages of other ESOP Participants who have timely provided the Trustee with their voting instructions. As a result of the aggregate effect of the EBT, the pass through voting of unallocated ESOP Preferred Shares and the likelihood that some allocated ESOP Preferred Shares will not be voted, ESOP Participants who do vote will direct the voting of at least 7, and possibly more Shares. Accordingly, we encourage ESOP Participants to vote the GREEN INSTRUCTION card provided with this Supplement today AGAINST the Amendment Proposal and the Adjournment Proposal. 2 CERTAIN LITIGATION--RECENT DEVELOPMENTS On November 15, 1996, Norfolk Southern filed a Motion for Leave to Supplement and Amend the Complaint, previously filed in the District Court for the Eastern District of Pennsylvania (the "District Court"), in which Norfolk Southern requests permission to file its Second Amended Complaint for Declaratory and Injunctive Relief (the "Second Amended Complaint"). The Second Amended Complaint updates the description of counts contained in the earlier complaints and adds certain additional allegations of disclosure and fiduciary duty violations relating to such updated description of events. Among other allegations, the Second Amended Complaint includes allegations regarding the coercive front-end loaded, two-tier structure of the CSX Acquisition Proposal (and the fundamental unfairness thereof), and allegations concerning material misrepresentations and omissions by Conrail and its Board members in connection with the supplement to the CSX Offer to Purchase and with Conrail's Schedule 14D-9 statements relating to the CSX Acquisition Proposal and the Norfolk Southern Offer to Purchase and the Proposed Norfolk Southern/Conrail Merger. On November 18 and 19, 1996, a hearing was held before the Honorable Donald W. VanArtsdalen, United States District Court Judge for the Eastern District of Pennsylvania, on Norfolk Southern's motion for a preliminary injunction against Conrail. Norfolk Southern was seeking to enjoin the CSX Tender Offer from expiring on November 20, 1996 and to enjoin CSX from acquiring Shares pursuant to the CSX Tender Offer. On November 19, 1996 Judge VanArtsdalen issued an oral ruling denying Norfolk Southern's motion for a preliminary injunction. After the ruling, Norfolk Southern asked the District Court for an injunction pending appeal. The District Court denied this motion. On the same date, Norfolk Southern filed an emergency motion for an injunction pending appeal and a motion seeking an expedited appeal with the United States Court of Appeals for the Third Circuit (the "Third Circuit"). On November 20, 1996 the Third Circuit denied Norfolk Southern's motion for an injunction pending appeal. Accordingly, the CSX Tender Offer expired on November 20, 1996. On November 21, 1996, Norfolk Southern announced that no purpose would be served by seeking expedited review of the decision not to enjoin CSX's purchase, since CSX had completed its purchase of 19.9% of the Conrail Shares, and therefore Norfolk Southern would withdraw that motion. However, Norfolk Southern continues to pursue on the merits its lawsuit against Conrail and CSX. On December 5, 1996, Defendants in the Pennsylvania litigation filed their Answer and Defenses to Plaintiffs' Second Amended Complaint, generally denying, and asserting various defenses to, the allegations contained therein and requesting judgment on all claims and an award of costs and attorneys fees. Conrail and CSX also filed a Counterclaim to Plaintiffs' Second Amended Complaint (the "Counterclaim"), naming Norfolk Southern, Atlantic Acquisition Corporation and Kathryn B. McQuade as counterclaim defendants, alleging that David R. Goode and Henry C. Wolf are co-conspirators/aiders and abettors, and purporting to state the following claims: tortious interference with current and prospective contractual relationships, intentional infliction of harm, unfair competition and civil conspiracy. Further, the Counterclaim alleges that Norfolk Southern and certain of its executive officers have engaged in (i) dissemination of materially false and misleading information, (ii) promotion of an illusory tender offer, (iii) purportedly improper commencement of a lawsuit, (iv) false and misleading solicitation of proxies for the upcoming Conrail shareholder vote and (v) efforts to manipulate the market through unfair, tortious conduct, in violation of the federal securities laws. The Counterclaim requests a jury trial and an award of damages, punitive damages, costs and attorneys fees. Norfolk Southern believes that the Counterclaim is without merit and intends to defend it vigorously. * * * NORFOLK SOUTHERN CORPORATION Dated: December 9, 1996 3 ADDITIONAL INFORMATION If your Shares are held in the name of a bank or broker, only your bank or broker can vote your Shares and only upon receipt of your specific instructions. Please instruct your bank or broker to vote AGAINST the Amendment Proposal and the Adjournment Proposal by executing the GOLD proxy card today. If you have any questions or require any assistance in voting your Shares, please call: [GEORGESON AND COMPANY INC. LOGO] Wall Street Plaza New York, New York 10005 Call Toll Free: 800-223-2064 Banks and Brokers call: 212-440-9800 -----END PRIVACY-ENHANCED MESSAGE-----