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EXHIBIT 10(f)
High River Limited Partnership
000 Xxxxx Xxxxxxx Xxxx
Xxxxx Xxxxx, Xxx Xxxx 00000
November 5, 1995
New Valley Corporation
ALKI Corp.
000 X.X. Xxxxxx Xxxxxx
Xxxxx, Xxxxxxx 00000
Attn: Xxxxxxx X. XxXxx
Dear Xxxxxxx:
By executing this letter in the space provided below, New Valley
Corporation, a New York corporation ("New Valley"), ALKI Corp., a Delaware
corporation and a direct wholly-owned subsidiary of New Valley ("NV Sub") and
High River Limited Partnership, a Delaware limited partnership ("High River"),
each hereby agree as follows:
1. All capitalized terms used herein and not otherwise defined
shall have the meanings ascribed to such terms in the Agreement by and among
New Valley, NV Sub and High River, dated October 17, 1995 (the "New Valley
Agreement").
2. Section 1(b)(iii) of the New Valley Agreement is hereby
amended to add the following to the end of the subsection:
"; provided, however, that neither High River nor the New Valley Group
shall have any obligation to make a Second Stage Investment unless and
until the New Valley Group gives notice ("Second Stage Notice") to High
River of the New Valley Group's intention to proceed with and make its
Second Stage Investment."
3. Notwithstanding the terms of Sections 1(c)(ii)-(iv) of the New
Valley Agreement and the letter agreement by and among New Valley, NV Sub and
High River, dated October 17, 1995 (the "Letter Agreement"), following the
First Stage Completion Date and prior to the earlier of (i) such time that New
Valley, NV Sub and any assignee of the foregoing ("New Valley Group")
beneficially own a number of shares of common stock, par value $.01 per share,
of RJR Nabisco Holdings Corp. ("Shares") equal to or greater than the number of
Shares beneficially owned by High River and its affiliates ("High River Group")
(the "Catch Up Date") and (ii) both New Valley Group and High River Group have
made investments in Shares equal to at least the Second Stage Investment (the
"Second Stage Completion Date"), neither High River Group nor New Valley Group
shall be obligated to make or cause to be made to the other party:
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(i) such transfer of Shares and such payments as would have been
necessary so that, after giving effect to such transfers and payments, New
Valley Group and High River Group would have acquired the same number of
Qualifying Shares;
(ii) such payments as would have been necessary so that, after giving
effect to such payments, New Valley Group and High River Group would have
invested the same amount in Qualifying Shares (exclusive of brokerage fees
and commissions incurred in such acquisitions); or
(iii) such transfer of Non-Qualifying Shares or payment for
Non-Qualifying Shares in accordance with Section 1(c)(iii) of the New
Valley Agreement.
In the event that the Catch Up Date precedes the Second Stage Completion Date
and following the Catch Up Date (but prior to the Second Stage Completion Date)
New Valley Group purchases Shares, then (x) the parties shall calculate the
aggregate number and the average price of all Qualifying Shares acquired after
the Catch Up Date by New Valley Group and High River Group, respectively, on a
periodic basis, with emphasis on doing so when the parties own a similar number
of Shares, and make payments to one another in immediately available funds, so
that after giving effect to such payments, New Valley Group and High River
Group will have invested the same amount in Qualifying Shares acquired after
the Catch Up Date (exclusive of brokerage fees and commissions incurred in such
acquisitions); (y) New Valley Group may, in accordance with Section 1(c)(iii)
of the New Valley Agreement, put to High River Non-Qualifying Shares at the
Hurdle Price; and (z) the parties shall follow the even up procedures set forth
in Section 1(c)(v) of the New Valley Agreement. In the event that following
the Catch Up Date, New Valley does not purchase Shares, then clauses (i)-(iii)
of this Paragraph 3 shall remain in effect.
4. Section 1(d)(i) of the New Valley Agreement is hereby amended
to delete the first two lines in their entirety and to substitute in lieu
thereof the following:
"Except as provided in subpart (ii) of this subparagraph (d)
and except as provided in Section 9(g) of this Agreement, until the
termination of this Agreement,"
5. Notwithstanding Section 1(d) of the New Valley Agreement, if
at any time subsequent to the First Stage Completion Date but prior to the
Second Stage Completion Date, High River Group beneficially owns more Shares
than New Valley Group, then High River Group may sell, transfer or otherwise
dispose of ("Transfer") Shares beneficially owned by it, provided that
following such Transfer, the number of Shares beneficially owned by High River
Group would not be less than the number of Shares beneficially owned by New
Valley Group, as reflected in
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New Valley Group's last written notice to High River Group in accordance with
Section 1(c)(i) of the New Valley Agreement.
6. Section 3(b)(ii)(B) of the New Valley Agreement is hereby
amended to delete the subsection in its entirety and to substitute in lieu
thereof the following:
"(B) a party hereto which is not a member of such selling or offering
Group thereafter terminates this Agreement prior to or on the tenth day
after the first date that such party becomes aware that such event has
occurred,"
7. New Valley Group shall promptly make any payments due under
Section 5(d) of the New Valley Agreement and Section 4(c) of the Agreement
among Brooke Group Ltd., BGLS Inc. and High River dated October 17, 1995 (the
"BGL Agreement"). In the event that High River Group believes that New Valley
Group has breached any of its obligations under Section 5(d) of the New Valley
Agreement or Section 4(c) of the BGL Agreement, the parties shall promptly
follow the procedures set forth in Section 1(c)(v) of the New Valley Agreement
in order to resolve the dispute. If the Arbitrator determines that (i) New
Valley Group is required to make a payment pursuant to Section 5(d) of the New
Valley Agreement and/or Section 4(c) of the BGL Agreement, New Valley Group
shall make or cause to be made such payment within twenty (20) days after
receiving the Arbitrator's notice of decision. In the event that New Valley
Group fails to make such payment within twenty (20) days after receipt of the
Arbitrator's notice of decision, New Valley Group shall immediately pay or
cause to be paid to High River Group an additional sum in the amount of $50
million.
8. The first sentence of Section 9(g) of the New Valley Agreement
is hereby amended to add the following to the end of the sentence:
"; and provided, however, that the New Valley Group may assign any of
its rights and interests hereunder to (i) any corporation incorporated in
any state of the United States or in the District of Columbia if 100% of
the shares of each class of capital stock of such corporation are owned by
New Valley (a "wholly-owned New Valley subsidiary"), either directly or
through one or more wholly-owned New Valley subsidiaries or (ii) any
partnership, the partners of which are all wholly-owned New Valley
subsidiaries; and provided, further, that no such assignment shall relieve
the New Valley Group of any of its obligations hereunder."
9. In the event that prior to February 1, 1996 (i) New Valley
Group provides High River Group with notice of termination of the New Valley
Agreement or BGL Group provides High River with notice of termination of the
BGL Agreement at a time when a Termination Event (as defined in the BGL
Agreement) set forth in Section 3(c)(vii) or 3(c)(viii) of the BGL Agreement
has occurred or (ii) High River Group provides New Valley Group
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with notice of termination of the New Valley Agreement or provides BGL Group
with notice of termination of the BGL Agreement at a time when a Termination
Event set forth in Section 3(c)(ix)(A) of the BGL Agreement has occurred, New
Valley Group shall not transfer any Shares beneficially owned by New Valley
Group until February 1, 1996 in consequence of or in reliance upon such notice
of termination. If the notice of termination specified in clause (i) of the
preceding sentence is provided after January 16, 1996, and the aggregate number
of Shares beneficially owned by High River Group exceeds the aggregate number
of Shares beneficially owned by New Valley Group plus BGL Group (collectively,
the "Aggregate XxXxx Shares"), New Valley Group shall not Transfer any Shares
beneficially owned by New Valley Group for fifteen (15) days following receipt
by High River Group of New Valley Group's or BGL Group's notice of termination;
provided, however, that on such date not before February 1, 1996 that the
aggregate number of Shares beneficially owned by High River Group is equal to
or less than the Aggregate Xxxxx Shares, and thereafter, New Valley Group may
Transfer any Shares beneficially owned by New Valley Group.
10. In the event that High River Group provides New Valley Group
with notice of termination of the New Valley Agreement or provides BGL Group
with notice of termination of the BGL Agreement at a time when a Termination
Event under any of Sections 3(c)(ix)(B) through (E) of the New Valley Agreement
has occurred and the aggregate number of shares beneficially owned by High
River Group exceeds the Aggregate XxXxx Shares, New Valley Group shall not
Transfer any Shares beneficially owned by New Valley Group in consequence of or
in reliance upon such notice of termination until the earlier of (i) fifteen
(15) days following receipt by New Valley Group or BGL Group of High River
Group's notice of termination specified in the preceding sentence and (ii) the
date that the aggregate number of Shares beneficially owned by High River Group
is equal to or less than the Aggregate XxXxx Shares.
11. Nothing herein contained shall be construed to otherwise
abrogate the rights and obligations of the parties to this letter agreement
with respect to all other provisions of the New Valley Agreement, the BGL
Agreement and the Letter Agreement.
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If the foregoing reflects your understanding, please sign this letter
below. Upon your execution hereof, this letter agreement will become a binding
contract between us.
Very truly yours,
HIGH RIVER LIMITED PARTNERSHIP
By: RIVERDALE INVESTORS CORP., INC.
Its: General Partner
By: /s/
--------------------------------
Name:
Title:
Agreed to and Accepted:
NEW VALLEY CORPORATION
By: /s/
-----------------------------------
Name:
Title:
ALKI CORP.
By: /s/
-----------------------------------
Name:
Title:
[Signature page for letter agreement by and among New Valley Corporation, ALKI
Corp. and High River Limited Partnership, dated November 5, 1995]
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