<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 7, 1998
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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CBS CORPORATION
(Exact Name of Registrant as Specified in its Charter)
<TABLE>
<S> <C> <C>
PENNSYLVANIA 4833 25-0877540
(State or Other Jurisdiction of (Primary Standard Industrial (I.R.S. Employer
Incorporation or Organization) Classification Code Number) Identification No.)
</TABLE>
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51 WEST 52ND STREET
NEW YORK, NY 10019
(212) 975-4321
(Address, including zip code, and telephone number, including area code of
Registrants' principal executive offices)
LOUIS J. BRISKMAN, ESQ.
EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL
CBS CORPORATION
51 West 52nd Street
New York, NY 10019
(212) 975-4321
(Name, address, including zip code, and telephone number, including area code of
agent for service)
------------------------
COPIES TO:
DENNIS J. BLOCK, ESQ.
WEIL, GOTSHAL & MANGES LLP
767 Fifth Avenue
New York, NY 10153-0119
(212) 310-8000
------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
As soon as practicable after this Registration Statement becomes effective.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. [ ]
CALCULATION OF REGISTRATION FEE
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<TABLE>
<S> <C> <C> <C> <C>
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH CLASS OF SECURITIES AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
TO BE REGISTERED REGISTERED PER NOTE(1) OFFERING PRICE(1) REGISTRATION FEE
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7.15% Senior Notes due 2005....... $500,000,000 100% $500,000,000 $147,500
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</TABLE>
(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(f).
------------------------
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 A FURTHER AMENDMENT THAT SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE> 2
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. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE 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.
SUBJECT TO COMPLETION, DATED JULY 7, 1998
PROSPECTUS
LOGO
OFFER TO EXCHANGE ITS 7.15% SENIOR NOTES DUE 2005
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING 7.15% SENIOR NOTES DUE 2005
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 PM., NEW YORK CITY TIME,
ON , 1998, UNLESS EXTENDED.
CBS Corporation, a Pennsylvania corporation (the "Company") hereby offers
(the "Exchange Offer"), upon the terms and conditions set forth in this
Prospectus (the "Prospectus") and the accompanying Letter of Transmittal (the
"Letter of Transmittal"), to exchange $1,000 principal amount of its 7.15%
Senior Notes due 2005 (the "Exchange Notes"), registered under the Securities
Act of 1933, as amended (the "Securities Act"), pursuant to a Registration
Statement of which this prospectus is a part, for each $1,000 principal amount
of its outstanding 7.15% Senior Notes due 2005 (the "Old Notes"), of which
$500,000,000 principal amount is outstanding. The form and terms of the Exchange
Notes are the same as the form and terms of the Old Notes except that (i) the
Exchange Notes will have been registered under the Securities Act and,
therefore, will not bear legends restricting the transfer thereof and (ii)
holders of the Exchange Notes will not be entitled to certain rights of holders
of Old Notes under the Registration Rights Agreement (as defined). The Old Notes
and the Exchange Notes are referred to herein collectively as the "Notes." The
Exchange Notes will evidence the same debt as the Old Notes (which they replace)
and will be issued under and be entitled to the benefits of the Indenture dated
as of May 20, 1998 (the "Indenture") by and between the Company and Citibank,
N.A., as trustee, governing the Notes. See "The Exchange Offer" and "Description
of Notes."
The Company will accept for exchange any and all Old Notes validly tendered
and not withdrawn prior to 5:00 p.m., New York City time on ,
1998, unless extended by the Company in its sole discretion (the "Expiration
Date"). Tenders of Old Notes may be withdrawn at any time prior to 5:00 p.m. on
the Expiration Date. The Exchange Offer is subject to certain customary
conditions. See "The Exchange Offer."
The Old Notes were sold by the Company on May 20, 1998 to Merrill Lynch,
Pierce, Fenner & Smith Incorporated, Chase Securities Inc. and J.P. Morgan
Securities Inc. (the "Initial Purchasers") in a transaction not registered under
the Securities Act in reliance upon an exemption under the Securities Act (the
"Initial Offering"). The Initial Purchasers subsequently placed the Old Notes
with qualified institutional buyers in reliance on Rule 144A under the
Securities Act. Accordingly, the Old Notes may not be reoffered, resold or
otherwise transferred in the United States unless registered under the
Securities Act or unless an applicable exemption from the registration
requirements of the Securities Act is available. The Exchange Notes are being
offered hereunder in order to satisfy the obligations of the Company under the
Registration Rights Agreement entered into among the Company and the Initial
Purchaser in connection with the Initial Offering. See "The Exchange Offer."
The Notes will mature on May 20, 2005. Interest on the Notes will accrue at
a rate of 7.15% per annum and be payable semi-annually in arrears on each May 20
and November 20, commencing November 20, 1998. The Notes will be redeemable, at
the option of the Company, in whole at any time or in part from time to time, at
a redemption price equal to the greater of (i) 100% of the principal amount of
the Notes to be redeemed and (ii) the sum of the present value of the Remaining
Scheduled Payments (as defined herein) on the Notes to be redeemed, discounted
to the date of redemption, on a semiannual basis, at the Treasury Rate (as
defined herein) plus 25 basis points, plus accrued interest thereon to the date
of redemption. See "Description of Notes -- Optional Redemption."
(Continued on next page)
------------------------
SEE "RISK FACTORS" BEGINNING ON PAGE 11 FOR A DISCUSSION OF CERTAIN FACTORS
THAT SHOULD BE CONSIDERED BY HOLDERS WHO TENDER THEIR OLD NOTES IN THE EXCHANGE
OFFER.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE 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 date of this Prospectus is , 1998.
<PAGE> 3
(cover page continued)
Based upon an interpretation by the staff of the Securities and Exchange
Commission (the "Commission") set forth in certain no-action letters issued to
third parties, the Company believes that the Exchange Notes issued pursuant to
the Exchange Offer in exchange for Old Notes may be offered for resale, resold
and otherwise transferred by any holder thereof (other than any such holder that
is an "affiliate" of the Company within the meaning of Rule 405 under the
Securities Act) without compliance with the registration and prospectus delivery
requirements of the Securities Act, provided that such Exchange Notes are
acquired in the ordinary course of such holder's business and such holder has no
arrangement or understanding with any person to participate in the distribution
of such Exchange Notes. See "The Exchange Offer -- Resale of the Exchange
Notes." Holders of Old Notes wishing to accept the Exchange Offer must represent
to the Company, as required by the Registration Rights Agreement, that such
conditions have been met. Each broker-dealer (a "Participating Broker-Dealer")
that receives Exchange Notes for its own account pursuant to the Exchange Offer
must acknowledge that it will deliver a prospectus in connection with any resale
of such Exchange Notes. The Letter of Transmittal states that by so
acknowledging and by delivering a prospectus, a Participating Broker-Dealer will
not be deemed to admit that it is an "underwriter" within the meaning of the
Securities Act. This Prospectus, as it may be amended or supplemented from time
to time, may be used by a Participating Broker-Dealer in connection with resales
of Exchange Notes received in exchange for Old Notes where such Old Notes were
acquired by such Participating Broker-Dealer as a result of market-making
activities or other trading activities. The Company has agreed that, for a
period of 90 days after the Expiration Date, it will make this Prospectus
available to any Participating Broker-Dealer for use in connection with any such
resale. See "Plan of Distribution."
The Company will not receive any proceeds from the Exchange Offer. The
Company has agreed to bear the expenses of the Exchange Offer. No underwriter is
being used in connection with the Exchange Offer. Holders of Old Notes not
tendered and accepted in the Exchange Offer will continue to hold such Old Notes
and will be entitled to all the rights and benefits and will be subject to the
limitations applicable thereto under the Indenture and with respect to transfer
under the Securities Act. See "The Exchange Offer."
There has not previously been any public market for the Old Notes or the
Exchange Notes. The Company does not intend to list the Exchange Notes on any
securities exchange or to seek approval for quotation through any automated
quotation system. There can be no assurance that an active market for the
Exchange Notes will develop. See "Risk Factors -- Absence of a Public Market
Could Adversely Affect the Value of Exchange Notes." Moreover, to the extent
that Old Notes are tendered and accepted in the Exchange Offer, the trading
market for untendered and tendered but unaccepted Old Notes could be adversely
affected.
THE EXCHANGE OFFER IS NOT BEING MADE TO, NOR WILL THE COMPANY ACCEPT
SURRENDERS FOR EXCHANGE FROM, HOLDERS OF OLD NOTES IN ANY JURISDICTION IN WHICH
THE EXCHANGE OFFER OR THE ACCEPTANCE THEREOF WOULD NOT BE IN COMPLIANCE WITH THE
SECURITIES OR BLUE SKY LAWS OF SUCH JURISDICTION.
NO PERSON IS AUTHORIZED IN CONNECTION WITH ANY OFFERING HEREBY TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS OR
THE ACCOMPANYING LETTER OF TRANSMITTAL, AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. NEITHER THE DELIVERY OF THIS PROSPECTUS OR THE ACCOMPANYING LETTER OF
TRANSMITTAL, NOR ANY EXCHANGE MADE HEREUNDER, SHALL UNDER ANY CIRCUMSTANCES
CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF
ANY DATE SUBSEQUENT TO THE DATE HEREOF.
UNTIL , 1998 (90 DAYS AFTER COMMENCEMENT OF THE
EXCHANGE OFFER), ALL DEALERS EFFECTING TRANSACTIONS IN THE EXCHANGE NOTES,
WHETHER OR NOT PARTICIPATING IN THE EXCHANGE OFFER, MAY BE REQUIRED TO DELIVER A
PROSPECTUS. THIS IS IN ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A
PROSPECTUS WHEN ACTING AS UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD
ALLOTMENTS OR SUBSCRIPTIONS.
i
<PAGE> 4
(cover page continued)
THE EXCHANGE NOTES WILL BE AVAILABLE INITIALLY ONLY IN BOOK-ENTRY FORM.
EXCEPT AS DESCRIBED UNDER "BOOK-ENTRY; DELIVERY AND FORM," THE COMPANY EXPECTS
THAT THE EXCHANGE NOTES ISSUED PURSUANT TO THE EXCHANGE OFFER WILL BE
REPRESENTED BY A GLOBAL NOTE (AS DEFINED), WHICH WILL BE DEPOSITED WITH, OR ON
BEHALF OF, THE DEPOSITORY TRUST COMPANY ("DTC") AND REGISTERED IN ITS NAME OR IN
THE NAME OF CEDE & CO., ITS NOMINEE. BENEFICIAL INTERESTS IN THE GLOBAL NOTE
REPRESENTING THE EXCHANGE NOTES WILL BE SHOWN ON, AND TRANSFERS THEREOF WILL BE
EFFECTED THROUGH, RECORDS MAINTAINED BY DTC AND ITS PARTICIPANTS. AFTER THE
INITIAL ISSUANCE OF THE GLOBAL NOTE, NOTES IN CERTIFICATED FORM WILL BE ISSUED
IN EXCHANGE FOR THE GLOBAL NOTE ONLY UNDER LIMITED CIRCUMSTANCES AS SET FORTH IN
THE INDENTURE. SEE "BOOK-ENTRY; DELIVERY AND FORM."
PROSPECTIVE INVESTORS IN THE EXCHANGE NOTES ARE NOT TO CONSTRUE THE
CONTENTS OF THIS PROSPECTUS AS INVESTMENT, LEGAL OR TAX ADVICE. EACH INVESTOR
SHOULD CONSULT ITS OWN COUNSEL, ACCOUNTANT AND OTHER ADVISORS AS TO LEGAL, TAX,
BUSINESS, FINANCIAL AND RELATED ASPECTS OF THE EXCHANGE NOTES. THE COMPANY IS
NOT MAKING ANY REPRESENTATION TO ANY PROSPECTIVE INVESTOR IN THE EXCHANGE NOTES
REGARDING THE LEGALITY OF AN INVESTMENT THEREIN BY SUCH PERSON UNDER APPROPRIATE
LEGAL, INVESTMENT OR SIMILAR LAWS.
------------------------
THIS PROSPECTUS CONTAINS CERTAIN FORWARD-LOOKING STATEMENTS WITHIN THE
MEANING OF SECTION 27A OF THE SECURITIES ACT AND SECTION 21E OF THE SECURITIES
EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT"), THAT ARE NOT HISTORICAL
FACTS BUT RATHER REFLECT THE COMPANY'S CURRENT EXPECTATIONS CONCERNING FUTURE
RESULTS AND EVENTS. THE WORDS "BELIEVES," "EXPECTS," "INTENDS," "PLANS,"
"ANTICIPATES," "LIKELY," "WILL," AND SIMILAR EXPRESSIONS IDENTIFY SUCH
FORWARD-LOOKING STATEMENTS. THESE FORWARD-LOOKING STATEMENTS ARE SUBJECT TO
RISKS, UNCERTAINTIES, AND OTHER FACTORS, SOME OF WHICH ARE BEYOND THE COMPANY'S
CONTROL, THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE
FORECAST OR ANTICIPATED IN SUCH FORWARD-LOOKING STATEMENTS.
SUCH RISKS, UNCERTAINTIES, AND FACTORS INCLUDE, BUT ARE NOT LIMITED TO: THE
COMPANY'S ABILITY TO DEVELOP AND/OR ACQUIRE TELEVISION PROGRAMMING AND TO
ATTRACT AND RETAIN ADVERTISERS; THE IMPACT OF SIGNIFICANT COMPETITION BOTH FROM
OVER-THE-AIR BROADCAST STATIONS AND FROM ALTERNATIVE ADVERTISING MEDIA SUCH AS
CABLE TELEVISION, WIRELESS CABLE, IN-HOME SATELLITE DISTRIBUTION SERVICES, AND
PAY-PER-VIEW AND HOME VIDEO ENTERTAINMENT SERVICES; THE COMPANY'S ABILITY TO
COMPLETE THE DIVESTITURES OF ITS REMAINING INDUSTRIAL BUSINESSES ON A SCHEDULE
IN ACCORDANCE WITH ITS ANNOUNCED PLANS IN ORDER TO COMPLETE ITS TRANSITION FROM
AN INDUSTRIAL CONGLOMERATE TO A MEDIA COMPANY IN A TIMELY AND COST-EFFECTIVE
MANNER; LITIGATION RELATING TO ITS DISCONTINUED BUSINESSES; THE IMPACT OF NEW
TECHNOLOGIES; CHANGES IN FEDERAL COMMUNICATIONS COMMISSION REGULATIONS; AND SUCH
OTHER COMPETITIVE AND BUSINESS RISKS AS FROM TIME TO TIME MAY BE DETAILED IN THE
COMPANY'S COMMISSION REPORTS.
ALL WRITTEN OR ORAL FORWARD-LOOKING STATEMENTS ATTRIBUTABLE TO THE COMPANY
ARE EXPRESSLY QUALIFIED IN THEIR ENTIRETY BY THE FOREGOING CAUTIONARY
STATEMENTS.
ii
<PAGE> 5
AVAILABLE INFORMATION
The Company is subject to the periodic reporting and other financial
requirements of the Exchange Act, and, in accordance therewith, files reports
and other information with the Commission. Such reports and other information
filed with the Commission may 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, or at its regional offices located at 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661 and Seven World Trade Center, 13th
Floor, New York, New York 10048. Copies of such material can be obtained from
the public reference section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates and may also be accessed
electronically by means of the Commission's website at http://www.sec.gov. Such
materials can also be inspected at the offices of the New York Stock Exchange
(the "NYSE"), 20 Broad Street, New York, New York 10005.
The Company has filed with the Commission a Registration Statement on Form
S-4 (the "Exchange Offer Registration Statement," which term shall encompass all
amendments, exhibits, annexes and schedules thereto) pursuant to the Securities
Act, and the rules and regulations promulgated thereunder, covering the Exchange
Notes being offered hereby. This Prospectus does not contain all the information
set forth in the Exchange Offer Registration Statement. For further information
with respect to the Company and the Exchange Offer, reference is made to the
Exchange Offer Registration Statement. Statements made in this Prospectus as to
the contents of any contract, agreement or other document referred to are not
necessarily complete. With respect to each such contract, agreement or other
document filed as an exhibit to the Exchange Offer Registration Statement,
reference is made to the exhibit for a more complete description of the document
or matter involved, and each such statement shall be deemed qualified in its
entirety by such reference.
DOCUMENTS INCORPORATED BY REFERENCE
The Company's Annual Report on Form 10-K for the year ended December 31,
1997, the Company's Quarterly Report on Form 10-Q for the quarter ended March
31, 1998 and the Company's Current Reports on Form 8-K dated January 7, 1998,
February 4, 1998, February 5, 1998, April 30, 1998, June 5, 1998 and June 29,
1998 are incorporated herein by reference. In addition, all documents 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
Exchange Offer shall be deemed to be incorporated by reference herein and to be
a part hereof from the date of filing of such documents. Any statement contained
in a document incorporated or deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus to
the extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
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 this Prospectus.
The Company will provide, without charge to each person to whom this
Prospectus has been delivered, a copy of any or all of the documents referred to
above which have been or may be incorporated by reference herein, other than
exhibits to such documents (unless such exhibits are specifically incorporated
by reference therein). Requests for such copies should be directed to CBS
Corporation, 51 West 52nd Street, New York, New York 10019, Attention: Corporate
Relations, telephone number (212) 975-4321.
2
<PAGE> 6
SUMMARY
The following summary is qualified in its entirety by the more detailed
information and consolidated financial statements and related notes thereto
appearing elsewhere in or incorporated by reference into this Prospectus. In
November 1997, the Company announced the divestiture of its remaining industrial
businesses and expects to complete the sale of these businesses in 1998.
References to discontinued operations and discontinued businesses refer to the
Company's industrial businesses previously divested or expected to be divested
in 1998. To reflect the change in focus of its business operations, the
Company's name was changed from Westinghouse Electric Corporation to CBS
Corporation effective December 1, 1997. Unless the context otherwise requires,
reference to the "Company" herein refers to CBS Corporation and its consolidated
subsidiaries. For purposes of calculating data with respect to segment revenues
and EBITDA (as defined), reference to "Media Revenue" herein refers to revenue
as reported before the elimination of intercompany sales and reference to "Media
EBITDA" herein refers to EBITDA before certain non-allocated corporate overhead
costs, intercompany eliminations, and residual costs of discontinued businesses.
THE COMPANY
The Company is one of the largest radio and television broadcasters in the
United States. The Company operates its four principal businesses through its
Radio, Television Stations, Television Network and Cable Groups. These
businesses provide network television services to affiliated television
stations; operate the Company's non-broadcast television networks; produce news,
sports, and entertainment programming; and own and operate 14 television
broadcast stations and own 173 radio stations. For the twelve months ended March
31, 1998, the Company had $6 billion in revenues and $951 million in EBITDA. As
of June 30, 1998, the Company's equity market capitalization was approximately
$23 billion.
Over the past several years, the Company has significantly redefined its
business portfolio. The Company acquired CBS Broadcasting Inc. (formerly CBS
Inc.) in November 1995, Infinity Broadcasting Corporation ("Infinity") in
December 1996, Gaylord Entertainment Company's two major cable networks, The
Nashville Network ("TNN") and Country Music Television ("CMT"), in September
1997, and the radio broadcasting operations of American Radio Systems
Corporation ("American Radio") in June 1998.
BUSINESSES
Radio Group
After the June 1998 American Radio acquisition, the Company owns 173 AM and
FM radio stations in 35 markets. The Company's stations serve diverse target
demographics through a broad range of programming formats such as rock, oldies,
news/talk, adult contemporary, sports/talk, and country, including leading
franchises in news, sports, and personality programming. Following completion of
the divestitures required by the Federal Communications Commission ("FCC") and
the Department of Justice in connection with the American Radio acquisition and
the completion of other pending transactions, the Company will own approximately
165 radio stations; 62 of these radio stations are in the ten largest radio
markets in the United States. The Company believes that its presence in large
markets makes it attractive to advertisers and that the overall diversity of its
stations reduces its dependence on any single station, local economy, format or
advertiser. The Company also has a minority equity investment in and manages
Westwood One Inc., one of the nation's leading producers and distributors of
syndicated and network radio programming.
The Radio Group also includes TDI Worldwide, Inc. ("TDI"), one of the
largest outdoor advertising companies in the United States, operating
approximately 100 franchises, the majority of which are located in major
metropolitan areas. TDI also operates internationally with offices in the United
Kingdom and the Republic of Ireland. TDI sells space on various media, including
buses, trains, train platforms and terminals throughout commuter rail systems
and on billboards and phone kiosks. The Radio Group has among the highest
margins in the industry. Same station revenue growth of 20% in 1997 outpaced the
industry. For the twelve months ended March 31, 1998, the Radio Group accounted
for 25% of Media Revenue and 51% of Media EBITDA.
3
<PAGE> 7
Television Stations Group
The Television Stations Group consists of 14 owned and operated television
stations located in seven of the ten largest markets and 11 of the top 20
markets in the United States. The Television Stations Group seeks to develop
strong local franchises in each of its station's respective market. These
stations also provide a significant distribution outlet for the Television
Network, reaching approximately 32% of all television households in the United
States. In addition to CBS Television Network programming, each station provides
local news, public affairs and other programming to its local market. For the
twelve months ended March 31, 1998, the Television Stations Group accounted for
15% of Media Revenue and 37% of Media EBITDA.
Television Network
Through the CBS Television Network, the Company distributes a comprehensive
schedule of news and public affairs broadcasts, entertainment and sports
programming and feature films to more than 200 domestic affiliates and certain
overseas affiliated stations. The domestic affiliates, which include the 14
owned and operated television stations as well as independently owned stations,
serve all 50 states and the District of Columbia and reach over 99% of U.S.
households with televisions. The Television Network is responsible for sales of
advertising time for network broadcasts and related merchandising and sales
promotion activity. The Television Network includes CBS Entertainment, CBS News
and CBS Sports. In January 1998, the National Football League awarded the
Company the rights to broadcast American Football Conference games beginning
with the 1998 season. For the twelve months ended March 31, 1998, the CBS
Television Network accounted for 54% of Media Revenue and 6% of Media EBITDA.
Cable Group
The Cable Group owns and operates the Company's non-broadcast television
networks, including TNN, CMT, Eye on People, TeleNoticias, and two regional
sports networks. These networks are distributed by cable television and other
multichannel technologies. Acquired in 1997, TNN and CMT, reaching more than 71
million and 42 million television households in the United States, respectively,
are leading advertiser-supported cable networks featuring country music,
lifestyle and entertainment programming. For the twelve months ended March 31,
1998, the Cable Group accounted for 6% of Media Revenue and 6% of Media EBITDA.
BUSINESS STRATEGY
Following the divestiture of its remaining industrial businesses, the
Company will have completed its transition from an industrial conglomerate to a
leading media company. The Company's ongoing strategy is to: (i) develop new
revenue opportunities within its existing businesses and markets; (ii) focus on
reducing costs and increasing operating leverage; (iii) leverage the significant
cross promotional opportunities among its businesses; (iv) continue its emphasis
on free cash flow growth; and (v) improve Television Network profitability.
BUSINESS STRENGTHS
Leading Market Position. The Company is one of the largest radio and
television broadcasters in the United States. The CBS Television Network has
been the highest-rated daytime network for the last eight years. The Radio Group
is one of the largest radio and outdoor advertising companies, with operations
in the largest markets in the United States. With same station revenue growth of
20% in 1997, the Radio Group outpaced the industry. The Television Stations
Group is the second largest television station group in terms of household
coverage in the United States.
Strong Revenue and Cash Flow Growth. The Company has generated significant
revenue growth in all its businesses through both internal growth and
acquisitions. This revenue growth, coupled with ongoing cost-reduction
initiatives and modest capital expenditures, generates substantial free cash
flow.
Business Diversification. Following the divestiture of its remaining
industrial businesses, the Company will be a broad-based media company with
interests in radio and television station operations and network and cable
programming. The Company believes that its diversified portfolio of assets and
broad geographical
4
<PAGE> 8
coverage reduce the Company's exposure to risks associated with any one business
or region and provide significant cross promotion opportunities among the
Company's businesses.
Experienced and Proven Management. The Company's management team consists
of individuals with significant experience in all aspects of the media business.
Michael Jordan, Chairman and Chief Executive Officer, and Fredric Reynolds,
Chief Financial Officer, have led the Company through the significant
transformation from an industrial conglomerate to a leading media company. Mel
Karmazin, President and Chief Operating Officer, joined the Company following
the acquisition of Infinity in 1996 and provides substantial operating
experience and leadership. Leslie Moonves, President and Chief Executive Officer
of CBS Television, is one of the industry's leaders in television network
programming and management.
RECENT DEVELOPMENTS
Industrial Divestitures. In November 1997, the Company announced a
definitive agreement to sell its power generation business for $1.5 billion in
cash. The power generation sale is scheduled to close in mid-1998. In May 1998,
the Company announced a definitive agreement to sell its process control
division for $265 million in cash and the assumption of pension and other
liabilities. This sale is scheduled to close in the third quarter of 1998. In
June 1998, the Company announced a definitive agreement to sell its nuclear
power and government operations businesses for $238 million in cash and the
assumption of liabilities, commitments and obligations totalling approximately
$950 million. This transaction is expected to close before the end of 1998. See
Note 7 to the Financial Statements included in the Company's Annual Report on
Form 10-K for the year ended December 31, 1997 and Note 6 to the Condensed
Consolidated Financial Statements included in the Company's Quarterly Report on
Form 10-Q for the quarter ended March 31, 1998, which are incorporated herein by
reference.
Media Acquisitions. In June 1998, the Company acquired the radio
broadcasting operations of American Radio for $1.6 billion in cash plus the
assumption of approximately $1 billion of debt.
5
<PAGE> 9
THE INITIAL OFFERING
The Initial Offering....... The Old Notes were sold by the Company on May 20,
1998 to the Initial Purchasers pursuant to a
Purchase Agreement dated May 15, 1998 (the
"Purchase Agreement"). The Initial Purchasers
subsequently resold all of the Old Notes to
qualified institutional buyers in reliance on Rule
144A under the Securities Act.
Registration Rights
Agreement................ Pursuant to the Purchase Agreement, the Company and
the Initial Purchasers entered into a Registration
Rights Agreement dated as of May 20, 1998 (the
"Registration Rights Agreement"), which grants the
holders of the Old Notes certain exchange and
registration rights. The Exchange Offer is intended
to satisfy such exchange and registration rights
which terminate upon the consummation of the
Exchange Offer.
THE EXCHANGE OFFER
Securities Offered......... $500,000,000 aggregate principal amount of 7.15%
Senior Notes due 2005 of the Company.
The Exchange Offer......... The Company is offering to exchange $1,000
principal amount of Exchange Notes for each $1,000
principal amount of Old Notes that are properly
tendered and accepted. As of the date hereof,
$500,000,000 aggregate principal amount of Old
Notes are outstanding. The Company will issue the
Exchange Notes to holders on or promptly after the
Expiration Date.
Based on an interpretation by the staff of the
Commission set forth in no-action letters issued to
third parties, the Company believes that Exchange
Notes issued pursuant to the Exchange Offer in
exchange for Old Notes may be offered for resale,
resold and otherwise transferred by any holder
thereof (other than any such holder which is an
"affiliate" of the Company within the meaning of
Rule 405 under the Securities Act) without
compliance with the registration and prospectus
delivery provisions of the Securities Act;
provided, that such Exchange Notes are acquired in
the ordinary course of such holder's business and
that such holder does not intend to participate and
has no arrangement or understanding with any person
to participate in the distribution of such Exchange
Notes.
Any Participating Broker-Dealer that acquired Old
Notes for its own account as a result of
market-making activities or other trading
activities may be a statutory underwriter. Each
Participating Broker-Dealer that receives Exchange
Notes for its own account pursuant to the Exchange
Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such
Exchange Notes. The Letter of Transmittal states
that by so acknowledging and by delivering a
prospectus, a Participating Broker-Dealer will not
be deemed to admit that it is an "underwriter"
within the meaning of the Securities Act. This
Prospectus, as it may be amended or supplemented
from time to time, may be used by a Participating
Broker-Dealer in connection with resales of
Exchange Notes received in exchange for Old Notes
where such Old Notes were acquired by such
Participating Broker-Dealer as a result of market-
making activities or other trading activities. The
Company has agreed
6
<PAGE> 10
that, for a period of 90 days after the Expiration
Date, it will make this Prospectus available to any
Participating Broker-Dealer for use in connection
with any such resale. See "Plan of Distribution."
Any holder who tenders in the Exchange Offer with
the intention to participate, or for the purpose of
participating, in a distribution of the Exchange
Notes could not rely on the position of the staff
of the Commission enunciated in no-action letters
and, in the absence of an exemption therefrom, must
comply with the registration and prospectus
delivery requirements of the Securities Act in
connection with any resale transaction. Failure to
comply with such requirements in such instance may
result in such holder incurring liability under the
Securities Act for which the holder is not
indemnified by the Company.
Expiration Date............ 5:00 p.m., New York City time, on ,
1998 unless the Exchange Offer is extended, in
which case the term "Expiration Date" means the
latest date and time to which the Exchange Offer is
extended.
Accrued Interest on the
Exchange Notes and the
Old Notes................ Each Exchange Note will bear interest from its
issuance date. Holders of Old Notes that are
accepted for exchange will receive, in cash,
accrued interest thereon to, but not including, the
issuance date of the Exchange Notes. Such interest
will be paid with the first interest payment on the
Exchange Notes. Interest on the Old Notes accepted
for exchange will cease to accrue upon issuance of
the Exchange Notes.
Conditions to the Exchange
Offer...................... The Exchange Offer is subject to certain customary
conditions, which may be waived by the Company. See
"The Exchange Offer -- Conditions."
Procedures for Tendering
Old Notes.................. Each holder of Old Notes wishing to accept the
Exchange Offer must complete, sign and date the
accompanying Letter of Transmittal, or a facsimile
thereof (or, in the case of a book-entry transfer,
transmit an Agent's Message (as defined) in lieu
thereof), in accordance with the instructions
contained herein and therein, and mail or otherwise
deliver such Letter of Transmittal, or such
facsimile (or Agent's message), together with the
Old Notes and any other required documentation to
the Exchange Agent (as defined) at the address set
forth herein. By executing the Letter of
Transmittal (or transmitting an Agent's Message),
each holder will represent to the Company that,
among other things, the Exchange Notes acquired
pursuant to the Exchange Offer are being obtained
in the ordinary course of business of the person
receiving such Exchange Notes, whether or not such
person is the holder, that neither the holder nor
any such other person has any arrangement or
understanding with any person to participate in the
distribution of such Exchange Notes and that
neither the holder nor any such other person is an
"affiliate," as defined under Rule 405 of the
Securities Act, of the Company. See "The Exchange
Offer -- Purpose and Effect of the Exchange Offer"
and "-- Procedures for Tendering."
Untendered Old Notes....... Following the consummation of the Exchange Offer,
holders of Old Notes eligible to participate but
who do not tender their Old Notes will not have any
further exchange or registration rights and such
Old Notes
7
<PAGE> 11
will continue to be subject to certain restrictions
on transfer. Accordingly, the liquidity of the
market for such Old Notes could be adversely
affected. See "Risk Factors -- Lack of Public
Market; Volatility; Restrictions on Resale."
Consequences of Failure to
Exchange................. The Old Notes that are not exchanged pursuant to
the Exchange Offer will remain restricted
securities. Accordingly, such Old Notes may be
resold only (i) to the Company, (ii) pursuant to
Rule 144A or Rule 144 under the Securities Act or
pursuant to some other exemption under the
Securities Act, (iii) outside the United States to
a foreign person pursuant to the requirements of
Rule 904 under the Securities Act, or (iv) pursuant
to an effective registration statement under the
Securities Act. See "The Exchange
Offer -- Consequences of Failure to Exchange."
Shelf Registration
Statement.................. If any holder of the Old Notes (other than any such
holder which is an "affiliate" of the Company
within the meaning of Rule 405 under the Securities
Act) is not eligible under applicable securities
laws to participate in the Exchange Offer, and such
holder has satisfied certain conditions relating to
the provision of information to the Company for use
therein, the Company has agreed to register the Old
Notes on a shelf registration statement (the "Shelf
Registration Statement") and to use its best
efforts to cause it to be declared effective by the
Commission as promptly as practical on or after the
consummation of the Exchange Offer. The Company has
agreed to maintain the effectiveness of the Shelf
Registration Statement for, under certain
circumstances, a maximum of two years, to cover
resales of the Old Notes held by any such holders.
Special Procedures for
Beneficial Owners.......... Any beneficial owner whose Old Notes are registered
in the name of a broker, dealer, commercial bank,
trust company or other nominee and who wishes to
tender should contact such registered holder
promptly and instruct such registered holder to
tender on such beneficial owner's behalf. If such
beneficial owner wishes to tender on such owner's
own behalf, such owner must, prior to completing
and executing the Letter of Transmittal and
delivering its Old Notes, either make appropriate
arrangements to register ownership of the Old Notes
in such owner's name or obtain a properly completed
bond power from the registered holder. The transfer
of registered ownership may take considerable time.
Guaranteed Delivery
Procedures................. Holders of Old Notes who wish to tender their Old
Notes and whose Old Notes are not immediately
available or who cannot deliver their Old Notes (or
comply with the procedures for book-entry
transfer), the Letter of Transmittal or any other
documents required by the Letter of Transmittal to
the Exchange Agent (or transmit an Agent's message
in lieu thereof) prior to the Expiration Date must
tender their Old Notes according to the guaranteed
delivery procedures set forth in "The Exchange
Offer -- Guaranteed Delivery Procedures."
Withdrawal Rights.......... Tenders may be withdrawn at any time prior to 5:00
p.m., New York City time, on the Expiration Date.
8
<PAGE> 12
Acceptance of Old Notes
and Delivery of Exchange
Notes.................... The Company will accept for exchange any and all
Old Notes which are properly tendered in the
Exchange Offer prior to 5:00 p.m., New York City
time, on the Expiration Date. The Exchange Notes
issued pursuant to the Exchange Offer will be
delivered promptly following the Expiration Date.
See "The Exchange Offer -- Terms of the Exchange
Offer."
Certain U.S. Federal Income
Tax Considerations......... For a discussion of material U.S. federal income
tax considerations relating to the exchange of the
Exchange Notes for the Old Notes, see "Certain U.S.
Federal Income Tax Considerations."
Use of Proceeds............ There will be no cash proceeds to the Company from
the issuance of the Exchange Notes pursuant to the
Exchange Offer. See "Use of Proceeds."
Exchange Agent............. The Exchange Agent is Citibank, N.A. The address
and telephone and facsimile numbers of the Exchange
Agent are set forth under "The Exchange
Offer -- Exchange Agent" and in the Letter of
Transmittal.
9
<PAGE> 13
SUMMARY OF THE TERMS OF THE NOTES
The Exchange Offer applies to the Old Notes. The form and terms of the
Exchange Notes are identical in all material respects to the form and terms of
the Old Notes, except that (i) the Exchange Notes will have been registered
under the Securities Act and, therefore, will not bear legends restricting the
transfer thereof and (ii) holders of the Exchange Notes will not be entitled to
certain rights of holders of Old Notes under the Registration Rights Agreement,
which rights will terminate upon consummation of the Exchange Offer. The
Exchange Notes will evidence the same debt as the Old Notes (which they replace)
and will be issued under and be entitled to the benefits of the Indenture. For
further information and for definitions of certain capitalized terms used below,
see "Description of Notes."
Securities Offered............ $500,000,000 principal amount of 7.15% Senior
Notes due 2005.
Maturity Date................. May 20, 2005.
Interest Payment Dates........ May 20 and November 20 of each year, commencing
November 20, 1998.
Optional Redemption........... The Notes will be redeemable, at the option of
the Company, in whole at any time or in part
from time to time, at a redemption price equal
to the greater of (i) 100% of the principal
amount of the Notes to be redeemed and (ii) the
sum of the present value of the Remaining
Scheduled Payments on the Notes to be redeemed,
discounted to the date of redemption, on a
semiannual basis, at the Treasury Rate plus 25
basis points, plus accrued interest thereon to
the date of redemption. See "Description of
Notes -- Optional Redemption."
Ranking....................... The Notes will be unsecured senior obligations
of the Company, and will rank pari passu in
right of payment with all other existing and
future unsubordinated obligations of the
Company and senior in right of payment to all
existing and future obligations of the Company
expressly subordinated in right of payment to
the Notes. The Notes, however, will be
effectively subordinated to secured
obligations, if any, of the Company with
respect to the assets of the Company securing
such obligations. As of March 31, 1998, on a
pro forma basis after giving effect to the
issuance of the Old Notes and the use of the
net proceeds therefrom, consolidated
indebtedness of the Company would have been
approximately $3.6 billion (excluding $526
million of long-term debt allocated to
discontinued operations), substantially all of
which would have been unsecured senior
indebtedness. In June 1998, in connection with
the acquisition of American Radio, the Company
incurred additional indebtedness. See
"-- Recent Developments -- Media Acquisitions."
Certain Covenants............. The Indenture under which the Notes will be
issued contains covenants, including, but not
limited to, covenants with respect to the
following matters: (i) limitation on liens;
(ii) limitation on sale and leasebacks; and
(iii) limitation on consolidation, merger and
sale of substantially all assets.
Governing Law................. The Indenture and the Notes will be governed by
the laws of the State of New York.
RISK FACTORS
See "Risk Factors" beginning on page 11 for a discussion of certain factors
which should be considered before tendering Old Notes in exchange for Exchange
Notes. The risk factors are generally applicable to the Old Notes as well as the
Exchange Notes.
10
<PAGE> 14
RISK FACTORS
In addition to the other information contained or incorporated by reference
in this Prospectus, the following factors should be carefully considered before
tendering Old Notes in exchange for Exchange Notes. The risk factors set forth
below are generally applicable to the Old Notes as well as the Exchange Notes.
LEVERAGE
The Company has substantial indebtedness which requires the Company to
generate sufficient cash flow for the payment of the principal of and interest
on such indebtedness. The Company is subject to significant interest expense and
principal repayment obligations. As of March 31, 1998, on a pro forma basis
after giving effect to the issuance of the Old Notes and the application of the
net proceeds therefrom, the Company would have total indebtedness of
approximately $3.6 billion (excluding $526 million of long-term debt allocated
to discontinued operations). In June 1998, in connection with the acquisition of
American Radio, the Company incurred additional indebtedness. See
"Summary -- Recent Developments -- Media Acquisitions." As a consequence of the
Company's indebtedness, its ability to obtain additional financing in the future
may be limited.
RANKING OF NOTES
The Notes will be senior obligations of the Company and will rank pari
passu in right of payment to all existing and future unsecured senior
indebtedness of the Company. The Notes are not secured by any assets of the
Company. Accordingly, the Notes will be effectively subordinated to any secured
obligations of the Company to the extent of the value of the assets securing
such obligation. If the Company becomes insolvent or is liquidated, or if
payment under any secured obligation is accelerated, the lenders under such
secured obligation will be entitled to exercise the remedies available to a
secured lender under applicable law and pursuant to the terms of the agreement
securing such obligation. Any claims of such lenders with respect to such assets
will be prior to any claim of the holders of the Notes with respect to such
assets. Accordingly, it is possible that there would be no assets remaining from
which claims of the holders of the Notes could be satisfied or if any such
assets remain, such assets might be insufficient to satisfy such claims fully.
RESTRICTIVE COVENANTS
The Company's credit facility, dated as of August 29, 1996, as amended,
among the Company and certain lenders named therein (the "Credit Facility"),
contains various financial and operating covenants which, among other things,
require the maintenance of certain financial ratios. Violation of the covenants
in the Credit Facility or in the indentures governing the Company's
publicly-issued notes and debentures could result in a default under the Credit
Facility which would permit the bank lenders thereunder to (i) restrict the
Company's ability to borrow undrawn funds under the Credit Facility and (ii)
accelerate the maturity of borrowings thereunder.
GOVERNMENT REGULATION
Broadcasting. The domestic broadcasting industry is subject to extensive
federal regulation which, among other things, requires approval by the FCC for
the issuance, renewal, transfer and assignment of broadcasting station operating
licenses, and limits the number of broadcasting properties the Company may own.
The Telecommunications Act of 1996 (the "1996 Act") provides both new
opportunities and potential new competition for broadcasting companies.
The Company's broadcasting business will continue to be dependent upon
maintaining broadcasting licenses issued by the FCC, which are issued for a
maximum term of eight years. There can be no assurance that future renewal
applications will be approved, or that renewals will not include conditions or
qualifications that could adversely affect the Company's operations. The FCC's
approval of the Company's acquisition of Infinity contained a number of
temporary waivers of the FCC's television and radio cross-ownership rules (the
"One-to-a-Market" Rule). These waivers were granted subject to the outcome of
the pending ownership rulemaking in which certain deregulation of the
"One-to-a-Market" Rule has been proposed. In the event that
11
<PAGE> 15
any station divestitures are required at the conclusion of this rulemaking, the
Company would be required to file applications with the FCC for consent to the
necessary divestitures within six months of the rulemaking order. The FCC orders
approving both the CBS Broadcasting Inc. and Infinity acquisitions are subject
to judicial appeals by certain third parties.
Antitrust. The Company may in the future acquire additional radio or
television stations and other media-related and outdoor advertising properties,
many of which are likely to require antitrust review by the Federal Trade
Commission (the "FTC") and the Antitrust Division of the United States
Department of Justice (the "Antitrust Division") prior to such acquisition.
There can be no assurance that the Antitrust Division or the FTC will not seek
to bar the Company from acquiring additional radio or television stations or
other media-related and outdoor advertising properties.
NEW TECHNOLOGIES
Developments in radio technology could affect competition in the radio
marketplace. New radio technology, known as digital audio broadcasting, can
provide the sound quality of compact discs, which is significantly higher than
that now provided by radio stations and networks using analog technology.
Current and future technological developments may affect competition within
the television marketplace. Developments in advanced digital technology may
enable competitors to provide high definition pictures and sound qualitatively
superior to what television stations now provide. Developing technology to
compress digital signals may also permit the same broadcast or cable channel or
satellite transponder to carry multiple video and data services, and could
result in an expanded field of competing services.
COMPETITION
The broadcast environment is highly competitive. The Company competes for
audiences, advertising and program distribution rights with other broadcast
television networks, television stations, cable networks and radio stations as
well as other media, including satellite television services, pay-per-view and
home video entertainment services and newspapers. In addition, the CBS
Television Network competes with other television networks to secure
affiliations with independently owned television stations in markets across the
country which are necessary to ensure effective distribution of network
programming to a nationwide audience.
RETAINED LIABILITIES OF DISCONTINUED BUSINESSES
Liabilities for certain of the Company's environmental matters as well as
certain litigation matters, although arising from discontinued businesses, are
expected to be retained by the Company following the divestiture of the
remaining industrial businesses. These liabilities include environmental
obligations that are not related to active properties of operating businesses,
accrued product liability claims for divested businesses, liabilities associated
with asbestos claims, and general litigation claims not involving active
businesses. Accrued liabilities associated with these matters, which have been
separately presented as retained liabilities of discontinued businesses, totaled
$945 million at March 31, 1998, including amounts related to previously
discontinued businesses of CBS Broadcasting Inc. A separate asset of $241
million has been recorded for amounts recoverable from insurance carriers under
previous settlement arrangements.
IMPACT OF YEAR 2000
The Company is addressing the issues associated with its existing computer
systems and their ability to operate effectively as the year 2000 approaches.
These issues involve computer programs and applications that were written using
two digits rather than four to identify the applicable year, and could result in
system failures or miscalculations. Both internal and external resources are
being utilized to address these matters throughout the Company. For the media
businesses, the assessment and planning phases of the project are essentially
complete. The Company believes that, based on available information, its year
2000 transition will not have a material adverse effect on its business,
operations, or financial results; provided, however, that the full impact is
uncertain and no assurances can be given as to the ultimate effect on the
Company.
12
<PAGE> 16
For the businesses that the Company expects to divest in 1998, the
assessment phase of the project is complete and the planning phase is well under
way. These matters are not anticipated to materially affect the disposition of
the businesses or the sale proceeds.
ABSENCE OF PUBLIC MARKET COULD ADVERSELY AFFECT THE VALUE OF EXCHANGE NOTES
The Old Notes were issued to, and the Company believes are currently owned
by, a relatively small number of beneficial owners. Prior to the Exchange Offer,
there has not been any public market for the Old Notes. The Old Notes have not
been registered under the Securities Act and will be subject to restrictions on
transferability to the extent that they are not exchanged for Exchange Notes by
holders who are entitled to participate in the Exchange Offer. The market for
Old Notes not tendered for exchange in the Exchange Offer is likely to be more
limited than the existing market for such Notes. The holders of Old Notes (other
than any such holder that is an "affiliate" of the Company within the meaning of
Rule 405 under the Securities Act) who are not eligible to participate in the
Exchange Offer are entitled to certain registration rights, and the Company is
required to filed a Shelf Registration Statement (as defined) with respect to
such Old Notes. The Exchange Notes will constitute a new issue of securities
with no established trading market. The Company does not intend to list the
Exchange Notes on any national securities exchange or seek the admission thereof
to trading in the National Association of Securities Dealers Automated Quotation
System. The Initial Purchasers have advised the Company that they currently
intend to make a market in the Exchange Notes, but they are not obligated to do
so and may discontinue such market-making at any time. In addition, such
market-making activity will be subject to the limits imposed by the Securities
Act and the Exchange Act and may be limited during the Exchange Offer and the
pendency of any Shelf Registration Statement. Accordingly, no assurance can be
given that an active public or other market will develop for the Exchange Notes
or as to the liquidity of the trading market for the Exchange Notes. If a
trading market does not develop or is not maintained, holders of Exchange Notes
may experience difficulty in reselling the Exchange Notes or may be unable to
sell them at all. If a market for the Exchange Notes develops, any such market
making may be discontinued at any time.
FAILURE TO EXCHANGE OLD NOTES
Exchange Notes will be issued in exchange for Old Notes only after timely
receipt by the Exchange Agent of such Old Notes, a properly completed and duly
executed Letter of Transmittal (or Agent's Message) and all other required
documentation. Therefore, holders of Old Notes desiring to tender such Old Notes
in exchange for Exchange Notes should allow sufficient time to ensure timely
delivery. Neither the Exchange Agent nor the Company is under any duty to give
notification of defects or irregularities with respect to tenders of Old Notes
for exchange. Old Notes that are not tendered or are tendered but not accepted
will, following consummation of the Exchange Offer, continue to be subject to
the existing restrictions upon transfer thereof and, upon consummation of the
Exchange Offer, certain registration rights under the Registration Rights
Agreement will terminate. In addition, any holder of Old Notes who tenders in
the Exchange Offer for the purpose of participating in a distribution of the
Exchange Notes may be deemed to have received restricted securities, and if so,
will be required to comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any resale transaction.
Each Participating Broker-Dealer that receives Exchange Notes for its own
account in exchange for Old Notes, where such Old Notes were acquired by such
Participating Broker-Dealer as a result of market-making activities or any other
trading activities, must acknowledge that it will deliver a prospectus in
connection with any resale of such Exchange Notes. See "Plan of Distribution."
To the extent that Old Notes are tendered and accepted in the Exchange Offer,
the trading market for untendered and tendered but unaccepted Old Notes could be
adversely affected. See "The Exchange Offer."
13
<PAGE> 17
USE OF PROCEEDS
The Exchange Offer is intended to satisfy certain of the Company's
obligations under the Purchase Agreement and the Registration Rights Agreement.
The Company will not receive any cash proceeds from the issuance of the Exchange
Notes offered hereby. In consideration for issuing the Exchange Notes
contemplated in this Prospectus, the Company will receive Old Notes in like
principal amount, the form and terms of which are the same as the forms and
terms of the Exchange Notes (which replace the Old Notes), except as otherwise
described herein. The Old Notes surrendered in exchange for Exchange Notes will
be retired and canceled and cannot be reissued. Accordingly, issuance of the
Exchange Notes will not result in any increase or decrease in the indebtedness
of the Company. As such, no effect has been given to the Exchange Offer in the
capitalization table. The net proceeds to the Company from the sale of the Old
Notes was approximately $493 million after underwriting discounts and expenses.
The Company used the net proceeds from the sale of the Old Notes was to repay a
portion of indebtedness outstanding under the Credit Facility. As of March 31,
1998, the Company had an aggregate of $1.4 billion outstanding under the Credit
Facility, excluding $384 million allocated to discontinued operations. In June
1998, in connection with the acquisition of American Radio, the Company incurred
additional indebtedness. See "Summary -- Recent Developments -- Media
Acquisitions." The Credit Facility expires on August 29, 2001. The average
interest rate on borrowings outstanding as of March 31, 1998 was 6.4%. Amounts
repaid under the Credit Facility as a result of the sale of the Old Notes may be
re-borrowed.
14
<PAGE> 18
CAPITALIZATION
The following table sets forth the capitalization of the Company as of
March 31, 1998, after giving effect to the issuance of the Old Notes and the
application of the net proceeds therefrom. This information should be read in
conjunction with the unaudited condensed consolidated financial statements of
the Company, including the notes thereto, and "Management's Discussion and
Analysis of Financial Condition and Results of Operations" incorporated by
reference in this Prospectus. (In millions).
<TABLE>
<S> <C>
Cash and cash equivalents................................... $ 72
=======
Short-term debt............................................. $ 128
Long-term debt (including current portion)(a)(b):
Credit Facility........................................... 788
7.15% Senior Notes due 2005............................... 500
8 3/8% Notes due 2002..................................... 348
7 7/8% Debentures due 2023................................ 325
6 7/8% Notes due 2003..................................... 275
8 5/8% Debentures due 2012................................ 273
8 7/8% Notes due 2001..................................... 250
8 7/8% Notes due 2014..................................... 150
7 5/8% Notes due 2002..................................... 150
7 3/4% Notes due 1999..................................... 125
7 1/8% Notes due 2023..................................... 97
8 7/8% Debentures due 2022................................ 92
Medium-Term Notes due through 2001........................ 47
Other..................................................... 50
-------
Total long-term debt.............................. 3,470
Shareholders' equity:
Common Stock, $1.00 par value (1,100 million shares
authorized and
723 million shares issued)............................. 723
Capital in excess of par value............................ 7,288
Common stock held in treasury, at cost.................... (540)
Retained earnings......................................... 1,468
Accumulated other comprehensive loss...................... (779)
-------
Total shareholders' equity........................... 8,160
-------
Total capitalization.............................. $11,758
=======
</TABLE>
- ---------------
(a) Amounts herein exclude $526 million of long-term debt allocated to
discontinued operations.
(b) In June 1998, in connection with the acquisition of American Radio, the
Company incurred additional indebtedness. See "Summary -- Recent
Developments -- Media Acquisitions."
15
<PAGE> 19
SELECTED FINANCIAL AND OPERATING DATA
The selected consolidated historical financial data presented below have
been derived from and should be read in conjunction with the Company's audited
consolidated financial statements and the notes thereto included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1997 and
the Company's Quarterly Report on Form 10-Q for the quarter ended March 31,
1998, which are incorporated herein by reference. The Company's historical
financial data include the results of the following acquired entities subsequent
to their respective dates of acquisition: TNN and CMT from September 30, 1997;
Infinity from December 31, 1996; and CBS Broadcasting Inc. from November 24,
1995.
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31, FISCAL YEAR ENDED DECEMBER 31,
------------------- -----------------------------------------------
1998 1997 1997 1996 1995 1994 1993
-------- -------- ------- ------- ------- ------- -------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Revenues.......................... $ 1,949 $ 1,326 $ 5,363 $ 4,143 $ 1,074 $ 744 $ 684
Operating expenses................ (1,645) (1,240) (4,526) (3,696) (820) (477) (603)
Depreciation and amortization..... (130) (105) (445) (279) (57) (41) (34)
Residual costs of discontinued
businesses...................... (38) (35) (143) (114) (37) (75) (1)
------- ------- ------- ------- ------- ------- -------
Operating profit.................. 136 (54) 249 54 160 151 46
Other income (expense), net....... 5 41 78 55 152 (131) 35
Interest expense.................. (75) (101) (386) (401) (184) (26) (55)
------- ------- ------- ------- ------- ------- -------
Income (loss) from continuing
operations before income taxes
and minority interest........... 66 (114) (59) (292) 128 (6) 26
Income tax (expense) benefit...... (47) 22 (73) 71 (75) 1 43
Income (loss) from discontinued
operations...................... -- (60) 680 409 (57) 58 (388)
Net income (loss)................. 19 (151) 549 95 (10) 48 (329)
OTHER FINANCIAL DATA (CONTINUING
OPERATIONS):
EBITDA(a)......................... $ 271 $ 92 $ 772 $ 388 $ 369 $ 61 $ 115
Capital expenditures.............. 18 21 121 93 32 37 23
Ratio of earnings to fixed
charges(b)...................... 1.8x (b) (b) (b) 1.6x (b) 1.5x
Ratio of EBITDA to interest
expense......................... 3.6x (c) 2.0x 1.0x 2.0x 2.3x 2.1x
Ratio of total long-term debt to
EBITDA.......................... (d) (d) 4.2x 13.3x 19.6x 30.6x 16.2x
BALANCE SHEET DATA (AT END OF
PERIOD):
Total assets...................... $17,121 $17,373 $16,715 $17,052 $14,258 $ 6,948 $ 7,624
Total long-term debt(e)........... 3,430 6,126 3,236 5,147 7,222 1,865 1,868
Shareholders' equity.............. 8,160 5,595 8,080 5,731 1,453 1,789 1,078
SELECTED OPERATING DATA:
Number of owned & operated radio
stations........................ 75 81 76 79 39 16 14
Number of owned & operated TV
stations........................ 14 14 14 14 15 5 5
</TABLE>
- ---------------
(a) EBITDA represents income before interest, income taxes, depreciation and
amortization. EBITDA is not intended to represent cash flow or any other
measure of performance reported in accordance with generally accepted
accounting principles. The Company uses EBITDA as a key internal performance
measure and has included EBITDA as it understands that EBITDA is used by
certain investors as one measure of a company's ability to service its debt.
(b) For purposes of determining the ratio of earnings to fixed charges,
"earnings" consist of income before income taxes and fixed charges, and
fixed charges consist of interest (including capitalized interest) on all
indebtedness, amortization of deferred financing costs and that portion of
rental expenses that management believes to be representative of interest.
Additional income before income taxes and minority interest necessary to
attain a ratio of 1.0x for the three months ended March 31, 1997 and the
years ended December 31, 1997, 1996 and 1994 would be $116 million,
$68 million, $302 million and $3 million, respectively.
(c) Additional EBITDA necessary to attain a ratio of 1.0x for the three months
ended March 31, 1997 would be $9.0 million.
(d) Not meaningful.
(e) Excludes the current portion of long-term debt and long-term debt allocated
to discontinued operations.
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DESCRIPTION OF NOTES
The Exchange Notes offered hereby will be issued as a separate series under
the Indenture (the "Indenture") dated as of May 20, 1998 between the Company and
Citibank, N.A., as trustee (the "Trustee"). The form and terms of the Exchange
Notes are the same as the form and terms of the Old Notes (which they replace)
except that (i) the Exchange Notes will have been registered under the
Securities Act and, therefore, will not bear legends restricting the transfer
thereof and (ii) holders of the Exchange Notes will not be entitled to certain
rights of holders of Old Notes under the Registration Rights Agreement,
including the provisions providing for an increase in the interest rate on the
Old Notes in certain circumstances relating to the timing of the Exchange Offer,
which rights will terminate when the Exchange Offer is consummated. The Old
Notes issued in the Initial Offering and the Exchange Notes offered hereby are
referred to collectively as the "Notes."
The following summary of certain provisions of the Indenture does not
purport to be complete and is subject to, and is qualified in its entirety by
reference to, the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and to all of the provisions of the Indenture, including the definitions
of certain terms therein and those terms made a part of the Indenture by
reference to the Trust Indenture Act, as in effect on the date of the Indenture.
For definitions of certain capitalized terms used in the following summary, see
"-- Certain Definitions."
GENERAL
Principal of and interest on the Notes will be payable, and the Notes will
be exchangeable and transferable, at the office or agency of the Company in The
City of New York maintained for such purposes (which initially will be the
corporate trust office of the Trustee); provided, however, that, at the option
of the Company, interest may be paid by check mailed to the address of the
Person entitled thereto as such address shall appear on the security register.
The Notes will be issued only in registered form without coupons and only in
denominations of $1,000 and any integral multiple thereof. No service charge
will be made for any registration of transfer or exchange or redemption of
Notes, except in certain circumstances for any tax or other governmental charge
that may be imposed in connection therewith. The Notes will rank equally with
all other unsecured and unsubordinated debt of the Company.
TERMS OF THE NOTES
The Notes will mature on May 20, 2005, will be limited to $500,000,000
aggregate principal amount and will be unsecured senior obligations of the
Company. Each Note will bear interest at a rate of 7.15% per annum from May 20,
1998 or from the most recent interest payment date to which interest has been
paid or duly provided for, payable on November 20, 1998 and semi-annually
thereafter on May 20 and November 20 of each year until the principal thereof is
paid or duly provided for to the Person in whose name such Note (or any
predecessor Note) is registered at the close of business on the May 1 or
November 1 next preceding such interest payment date. Interest will be computed
on the basis of a 360-day year comprised of twelve 30-day months.
OPTIONAL REDEMPTION
The Notes will be redeemable, at the option of the Company, in whole at any
time or in part from time to time, on at least 30 but not more than 60 days
prior notice mailed to DTC, at a redemption price equal to the greater of (i)
100% of the principal amount of the Notes to be redeemed and (ii) the sum of the
present value of the Remaining Scheduled Payments on the Notes to be redeemed
discounted to the date of redemption, on a semiannual basis, at the Treasury
Rate plus 25 basis points, plus accrued interest thereon to the date of
redemption. Interest on the Notes shall be calculated on the basis of a 360-day
year consisting of twelve 30-day months.
If money sufficient to pay the redemption price of and accrued interest on
all Notes (or portions thereof) to be redeemed on the redemption date is
deposited with the Trustee on or before the redemption date and
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<PAGE> 21
certain other conditions are satisfied, on and after such date, interest will
cease to accrue on the Notes (or such portions thereof) called for redemption.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term of the Notes to be redeemed that would be utilized, at the
time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of the Notes. "Independent Investment Banker" means one of the
Reference Treasury Dealers appointed by the Company.
"Comparable Treasury Price" means, with respect to any redemption date, (i)
the average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
business day preceding such redemption date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such business day, (A) the average
of the Reference Treasury Dealer Quotations for such redemption date, after
excluding the highest and lowest such Reference Treasury Dealer Quotations, or
(B) if the Trustee obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such Quotations. "Reference Treasury Dealer
Quotations" means, with respect to each Reference Treasury Dealer and any
redemption date, the average, as determined by the Trustee, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case as a percentage
of its principal amount) quoted in writing to the Trustee by such Reference
Treasury Dealer at 5:00 p.m. on the third business day preceding such redemption
date.
"Reference Treasury Dealer" means each of Merrill Lynch, Pierce, Fenner &
Smith Incorporated, Chase Securities Inc., and J.P. Morgan Securities Inc. and
their respective successors and, at the option of the Company, additional
Primary Treasury Dealers; provided, however, that if any of the foregoing shall
cease to be a primary U.S. Government securities dealer in The City of New York
(a "Primary Treasury Dealer"), the Company shall substitute therefor another
Primary Treasury Dealer.
"Remaining Scheduled Payments" means, with respect to any Note, the
remaining scheduled payments of the principal thereof to be redeemed and
interest thereon that would be due after the related redemption date but for
such redemption; provided, however, that, if such redemption date is not an
interest payment date with respect to such Note, the amount of the next
succeeding scheduled interest payment thereon will be reduced by the amount of
interest accrued thereon to such redemption date.
"Treasury Rate" means, with respect to any redemption date, the rate per
annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date.
CERTAIN COVENANTS
The covenants summarized below will be applicable (unless waived or
amended) so long as any of the Notes are outstanding.
Limitation on Liens
The Company will not itself, and will not permit any Restricted Subsidiary
to, incur, issue, assume or guarantee any Debt secured by a Mortgage on any
Restricted Property, or by any shares of stock of a Restricted Subsidiary,
without effectively providing concurrently with the incurrence, issuance,
assumption or guarantee of such secured Debt that the Notes (together with, if
the Company shall so determine, any other indebtedness of or guaranteed by the
Company or such Restricted Subsidiary then existing or thereafter created
ranking on a parity with the Notes) shall be secured equally and ratably with
(or prior to) such secured Debt, so long as such Debt shall be so secured,
unless, after giving effect thereto, the aggregate principal amount of all such
secured Debt (excluding any Debt secured by Mortgages permitted by clauses (a)
through (h) below), plus all Attributable Debt of the Company and its Restricted
Subsidiaries in respect
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of sale and lease-back transactions (as defined under "Limitation on Sale and
Lease-Backs") involving Restricted Property, but excluding any Attributable Debt
in respect of any such sale and lease-back transaction the proceeds of which
have been applied in the manner set forth in clause (b) under "Limitation on
Sale and Lease-Backs" would not exceed 10% of the Consolidated Adjusted Book
Capitalization as determined on the basis of the most recent quarterly
consolidated balance sheet of the Company; provided, however, that such
restrictions shall not apply to (a) Mortgages existing on the date of the
Indenture; (b) Mortgages on property of, or on any shares of stock or
indebtedness of, any corporation existing at the time such corporation becomes a
Subsidiary; (c) Mortgages on property of, or on any shares of stock or
indebtedness of any corporation existing at the time such corporation is merged
with or consolidated with the Company or a Restricted Subsidiary or at the time
of a sale, lease or other disposition of the properties of a corporation as an
entirety or substantially as an entirety to the Company or a Restricted
Subsidiary; (d) Mortgages on property existing at the time of the acquisition
thereof or to secure the payment of all or any part of the purchase price or
construction cost thereof or to secure any indebtedness incurred prior to, at
the time of or within six months after, the acquisition or completion of such
property for the purpose of financing all or any part of the purchase price or
construction cost thereof; (e) Mortgages to secure all or part of the cost of
repairing, altering, constructing, improving or developing such property as is,
in the opinion of the Board of Directors of the Company, substantially
unimproved or to secure indebtedness incurred for the purpose of financing any
such cost; (f) Mortgages in favor of the Company or any Restricted Subsidiary;
(g) Mortgages on capital stock issued by, or partnership or other similar
interests in, any Subsidiary provided that the Debt secured by such Mortgage is
also secured by Mortgages which if incurred by the Company or a Restricted
Subsidiary would be covered by clause (d) or (e) of this paragraph on property
of such Subsidiary constituting at least 80% of the book value of its tangible
assets; or (h) any extension, renewal or replacement (or successive extensions,
renewals or replacements) as a whole or in part, of any Mortgage referred to in
the foregoing clauses (a) through (g) inclusive; provided that such extension,
renewal or replacement Mortgage shall be limited to all or part of the same
property that secured the Mortgage extended, renewed or replaced (plus
improvements on such property).
The Mortgage of any Restricted Property of the Company or a Restricted
Subsidiary in favor of the United States of America or any department, agency or
instrumentality thereof to secure partial, progress, advance or other payments
by the Company or any Subsidiary pursuant to the provisions of any contract or
statute shall not be deemed to create indebtedness secured by a Mortgage within
the meaning of the preceding paragraph.
Limitation on Sale and Lease-Backs
The Company will not itself, and will not permit any Restricted Subsidiary
to, enter into any arrangements with any bank, insurance company or other lender
or investor (not including the Company or any Restricted Subsidiary), or to
which any such lender or investor is a party providing for the leasing by the
Company or such Restricted Subsidiary for a period, including renewals, in
excess of three years of any Restricted Property which has been owned for more
than six months by the Company or such Restricted Subsidiary and which has been
or is to be sold or transferred by the Company or such Restricted Subsidiary to
such lender or investor or to any person to whom funds have been or are to be
advanced by such lender or investor on the security of such Restricted Property
(a "sale and lease-back transaction") unless either (a) the Company or such
Restricted Subsidiary could, under the restrictions described under "Limitation
on Liens" above, create Debt secured by a Mortgage on the Restricted Property to
be leased in an amount equal to the Attributable Debt with respect to such sale
and lease-back transaction without equally and ratably securing the Notes; or
(b) the Company, within six months after the sale or transfer shall have been
made, applies an amount equal to the greater of (i) the net proceeds of the sale
of the Restricted Property leased pursuant to such arrangement or (ii) the fair
market value of the Restricted Property so leased at the time of entering into
such arrangement (as determined by the Board of Directors of the Company) to the
retirement of Funded Debt of the Company ranking on a parity with the Notes
(except that no retirement referred to in this clause (b) may be effected by
payment at maturity or pursuant to any mandatory sinking fund or prepayment
provision).
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<PAGE> 23
Other than the restrictions on liens and sale and lease-back transactions
described above, the Indenture and the Notes will not contain any covenants or
other provisions designed to afford holders of the Notes protection in the event
of a highly leveraged transaction involving the Company.
CERTAIN DEFINITIONS
Certain terms defined in Section 1.1 of the Indenture are summarized below.
"Attributable Debt" means, as to any particular lease, the total net amount
of rent (discounted from the due dates thereof at the weighted average Yield to
Maturity of the Notes outstanding under the Indenture, such average being
weighted by the principal amount of the Notes) required to be paid by the lessee
during the remaining term thereof, excluding amounts required to be paid on
account of maintenance and repairs, insurance, taxes, assessments, water rates
and similar charges. In the case of any lease which is terminable by the lessee
upon the payment of a penalty, such rent will also include the amount of such
penalty, but no rent will be considered as required to be paid under such lease
subsequent to the first date upon which it may be so terminated. In the case of
any lease under which the amount of rent is indeterminable (e.g., where rent is
based on sales or profits), the net amount of rent required to be paid will be
the amount of rent paid during the preceding fiscal year.
"Consolidated Adjusted Book Capitalization" means, as to any Person, the
Consolidated Total Debt of such Person plus its shareholders' equity and any
Preferred Stock or other capital stock classified under generally accepted
accounting principles (as in effect on the date of the Indenture) as being
subject to redemption and not included in its shareholders' equity, plus
minority interests in its Subsidiaries.
"Consolidated Total Debt" means as to any Person, the total Debt of such
Person and its Subsidiaries computed and consolidated in accordance with
generally accepted accounting principles (as in effect on the date of the
Indenture).
"Debt" means (i) all obligations represented by notes, bonds, debentures or
similar evidences of indebtedness; (ii) all indebtedness for borrowed money or
for the deferred purchase price of property or services other than, in the case
of any deferred purchase price, on normal trade terms; and (iii) all rental
obligations as lessee under leases which shall have been or should be, in
accordance with generally accepted accounting principles (as in effect on the
date of the Indenture), recorded as capital leases.
"Funded Debt" means all indebtedness for borrowed money having a maturity
of more than 12 months from the date as of which the amount thereof is to be
determined or having a maturity of less than 12 months but by its terms being
renewable or extendable beyond 12 months from such date at the option of the
borrower.
"Mortgage" means any mortgage, pledge, lien, encumbrance, charge or
security interest of any kind.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Stock" means as to any Person, capital stock of such Person that
has a preference as to dividends or upon liquidation over the common stock of
such Person.
"Restricted Property" means all land, buildings, machinery and equipment
and leasehold interests and improvements which would be reflected on a
consolidated balance sheet of the Company and its consolidated Subsidiaries
prepared in accordance with generally accepted accounting principles (as in
effect on the date of the Indenture), excluding (i) all such property located
outside the United States; (ii) all rights, contracts and other intangible
assets of any nature whatsoever; (iii) all inventories, other current assets and
films, programs and film and program rights; and (iv) the real property
comprising the Company's headquarters building on West 52nd Street, New York,
New York, and the real property comprising the studio facilities in Studio City,
California, owned by Radford Studio Center Inc.
"Restricted Subsidiary" means any Subsidiary other than (i) a Subsidiary
substantially all the tangible properties of which are located, or substantially
all the operations of which are located or conducted, outside
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the United States; (ii) a Subsidiary the principal business of which consists of
one or more of the following: (A) investing in, developing or otherwise dealing
in or with real estate or providing services directly related thereto, (B)
financing, including without limitation, lending on the security of, purchasing
or discounting (with or without recourse), receivables, leases, obligations or
other claims arising from or in connection with the purchase or sale of products
or services or (C) leasing any form of property; or (iii) a Subsidiary the
consolidated assets of which do not include Restricted Property.
"Subsidiary" of any specified corporation means any corporation at least a
majority of whose outstanding voting stock shall at the time be owned, directly
or indirectly, by the specified corporation or by one or more of its
Subsidiaries, or both.
"Yield to Maturity" means the yield to maturity on the Notes, calculated at
the time of issuance of the Notes, or if applicable, at the most recent
redetermination of interest on the Notes, in accordance with accepted financial
practice.
EVENTS OF DEFAULT; WAIVER AND NOTICE THEREOF
An Event of Default is defined in the Indenture as being any one of the
following events: (a) default for 30 days in payment of any interest on the
Notes; (b) default in payment of principal of or any premium on the Notes at
maturity; (c) default by the Company in the performance of any other covenant or
warranty contained in the Indenture in respect of the Notes which shall not have
been remedied for a period of 90 days after notice is given as specified in the
Indenture; and (d) certain events of bankruptcy, insolvency and reorganization
of the Company.
The Indenture provides that if an Event of Default described in clause (a),
(b) or (c) above shall have occurred and be continuing with respect to the
Notes, either the Trustee or the holders of not less than 25% in aggregate
principal amount of the Notes then outstanding may declare the principal of all
the Notes and the interest accrued thereon, if any, to be due and payable
immediately, but upon certain conditions such declarations may be annulled and
past defaults (except for defaults in the payment of principal of, any premium
or any interest on, the Notes and in compliance with certain covenants) may be
waived by the holders of a majority in aggregate principal amount of the Notes
then outstanding. If an Event of Default specified in clause (d) above occurs
and is continuing, then the principal of and accrued interest on all outstanding
Notes shall automatically become and be immediately due and payable without any
other act on the part of the Trustee or any holder of Notes.
Under the Indenture, the Trustee must give notice to the holders of the
Notes known to it within 90 days after such a default occurs, unless such
default shall have been cured or waived; provided that in the case of a default
described in clause (c) above, no such notice shall be given until at least 90
days after such default occurs and provided further that, except in the case of
default in the payment of principal of or any interest on any of the Notes, the
Trustee shall be protected in withholding such notice if it in good faith
determines that the withholding of such notice is in the interests of the
holders of the Notes. For the purpose of this paragraph, the term default
includes the events specified above without notice or grace periods.
No holder of the Notes may institute any action under the Indenture unless
(a) such holder shall have given the Trustee written notice of a continuing
Event of Default; (b) the holders of not less than 25% in aggregate principal
amount of the Notes then outstanding shall have requested the Trustee to
institute proceedings in respect of such Event of Default; (c) such holder or
holders shall have offered the Trustee such indemnity as the Trustee may
require; (d) the Trustee shall have failed to institute an action for 60 days
thereafter; and (e) no inconsistent direction shall have been given to the
Trustee during such 60-day period by the holders of a majority in aggregate
principal amount of the Notes.
The holders of a majority in aggregate principal amount of the Notes then
outstanding will have the right, subject to certain limitations, to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on the Trustee with
respect to the Notes. The Indenture provides that, in case an Event of Default
shall occur and be continuing, the Trustee, in exercising its rights and powers
under the Indenture, will be required to use the degree of care of a prudent
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<PAGE> 25
person in the conduct of such person's own affairs. The Indenture further
provides that the Trustee shall not be required to expend or risk its own funds
or otherwise incur any financial liability in the performance of any of its
duties under the Indenture.
The Company must furnish to the Trustee within 120 days after the end of
each fiscal year a statement to the effect that a review of the activities of
the Company during such year and of its performance under the Indenture and the
terms of the Notes has been made and, to the best of the knowledge of the
signatory of such statement based on such review, the Company is not in default
in the performance and observance of the terms of the Indenture or, if the
Company is in default, specifying such default.
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
The Indenture provides that the Company may not consolidate or merge with
any other corporation or convey or transfer its properties and assets
substantially as an entirety to any person, unless (a) the successor shall be
organized and existing under the laws of the United States or any State thereof
or the District of Columbia, and shall expressly assume by a supplemental
indenture the due and punctual payment of the principal of and any premium or
any interest on the Notes and the performance of every covenant in the Indenture
on the part of the Company to be performed or observed; (b) immediately after
giving effect to such transaction, no Event of Default and no event which after
notice or lapse of time or both, would become an Event of Default shall have
happened and be continuing; and (c) the Company shall have delivered to the
Trustee an officers' certificate and an opinion of counsel, each stating that
such consolidation, merger, conveyance or transfer and such supplemental
indenture comply with the foregoing provisions relating to such transaction. In
case of any such consolidation, merger, conveyance or transfer, such successor
will succeed to and be substituted for the Company as obligor on the Notes, with
the same effect as if it had been named in the Indenture as the Company.
MODIFICATION OF THE INDENTURE
With certain exceptions, the Indenture or the rights of the holders of the
Notes may be modified by the Company and the Trustee with the consent of the
holders of a majority in aggregate principal amount of the Notes affected by
such modification then outstanding, but no such modification may be made which
would (a) change the maturity of any payment of principal of or any premium or
any installment of interest on the Notes, reduce the principal amount thereof or
the interest or any premium thereon, change the method of computing the amount
of principal thereof or interest thereon on any date, change any place of
payment where, or the coin or currency in which, the Notes or any premium or
interest thereon is payable or impair the right to institute suit for the
enforcement of any such payment on or after the maturity thereof (or, in the
case of redemption or repayment, on or after the redemption date or the
repayment date, as the case may be); (b) reduce the percentage in principal
amount of the outstanding Notes, the consent of whose holders is required for
any such modification or the consent of whose holders is required for any waiver
of compliance with certain provisions of the Indenture or certain defaults
thereunder and their consequences provided for in the Indenture; or (c) modify
any of the provisions of certain sections of the Indenture, including the
provisions summarized in this paragraph, except to increase any such percentage
or to provide that certain other provisions of the Indenture cannot be modified
or waived without the consent of the holder of each outstanding Note affected
thereby.
DEFEASANCE OF NOTES AND CERTAIN COVENANTS
The Company, at its option, either (a) will be discharged from any and all
obligations with respect to the Notes (except for certain obligations to
register the transfer or exchange of the Notes, replace stolen, lost or
mutilated Notes, maintain paying agencies and hold moneys for payment in trust)
or (b) will cease to be under any obligation to comply with certain restrictive
covenants of the Indenture (as described under "Certain Covenants" and
"Consolidation, Merger, Sale or Conveyance") with respect to the Notes, upon the
deposit with the Trustee, in trust, of money or the equivalent in United States
Treasury Securities or securities of United States government agencies backed by
the full faith and credit of the United States, or a combination thereof, which
through the payment of interest thereon and principal thereof in accordance with
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<PAGE> 26
their terms will provide money in an amount sufficient to pay all the principal
of and interest on the Notes on the dates such payments are due in accordance
with the terms of the Notes. To exercise any such option, no Event of Default or
event which with notice or lapse of time would become an Event of Default with
respect to the Notes shall have occurred and be continuing. The Company is
required to deliver to the Trustee an opinion of counsel to the effect that the
deposit and related defeasance would not cause the holders of the Notes to
recognize income, gain or loss for Federal income tax purposes and, in the case
of a discharge pursuant to clause (a), accompanied by a ruling to such effect
from the United States Internal Revenue Service.
BOOK-ENTRY; DELIVERY AND FORM
Notes initially will be represented by a single, permanent global note in
definitive, fully registered book-entry form for the Notes (a "Global Security")
which will be registered in the name of a nominee of DTC and deposited on behalf
of purchasers of the Notes represented thereby with a custodian for DTC for
credit to the respective accounts of the purchasers (or to such other accounts
as they may direct) at DTC.
The Global Security. The Company expects that pursuant to procedures
established by DTC (a) upon deposit of the Global Security, DTC or its custodian
will credit on its internal system portions of the Global Security which shall
be comprised of the corresponding respective amounts of the Global Security to
the respective accounts of persons who have accounts with such depositary and
(b) ownership of the Notes will be shown on, and the transfer of ownership
thereof will be effected only through, records maintained by DTC or its nominee
(with respect to interests of Participants (as defined below)) and the records
of Participants (with respect to interests of persons other than Participants).
Qualified institutional buyers (as defined in Rule 144A under the Securities
Act) ("QIBs") may hold their interests in the Global Security directly through
DTC if they are persons who have accounts with DTC ("Participants") in such
system, or indirectly through organizations which are Participants in such
system.
So long as DTC or its nominee is the registered owner or holder of any of
the Notes, DTC or such nominee will be considered the sole owner or holder of
such Notes represented by the Global Security for all purposes under the
Indenture and under the Notes represented thereby. No beneficial owner of an
interest in the Global Security will be able to transfer such interest except in
accordance with the applicable procedures of DTC in addition to those provided
for under the Indenture.
Payments of the principal of and interest on the Notes represented by the
Global Security will be made to DTC or its nominee, as the case may be, as the
registered owner thereof. None of the Company, the Trustee or any paying agent
under the Indenture will have any responsibility or liability for any aspect of
the records relating to or payments made on account of beneficial ownership
interests in the Global Security or for maintaining, supervising or reviewing
any records relating to such beneficial ownership interest.
The Company expects that DTC or its nominee, upon receipt of any payment of
the principal of and interest (including Additional Interest) on the Notes
represented by the Global Security, will credit Participants' accounts with
payments in amounts proportionate to their respective beneficial interests in
the Global Security as shown in the records of DTC or its nominee. The Company
also expects that payments by Participants to owners of beneficial interests in
the Global Security held through such Participants will be governed by standing
instructions and customary practice as is now the case with security held for
the accounts of customers registered in the names of nominees for such
customers. Such payment will be the responsibility of such Participants.
Transfers between Participants in DTC will be effected in accordance with
DTC rules and will be settled in immediately available funds. If a holder
requires physical delivery of a certificated security for any reason, including
to sell Notes to persons in states which require physical delivery of such
security or to pledge such security, such holder must transfer its interest in
the Global Security in accordance with the normal procedures of DTC and in
accordance with the procedures set forth in the Indenture.
DTC has advised the Company that DTC will take any action permitted to be
taken by a holder of Notes (including the presentation of Notes for exchange as
described below) only at the direction of one or more
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Participants to whose account the DTC interests in the Global Security are
credited and only in respect of the aggregate principal amount as to which such
Participant or Participants has or have given such direction. However, if there
is an Event of Default under the Indenture, DTC will exchange the Global
Security for certificated security, which it will distribute to its
Participants.
DTC has advised the Company as follows: DTC is a limited purpose trust
company organized under the laws of the State of New York, a member of the
Federal Reserve System, a "clearing corporation" within the meaning of the
Uniform Commercial Code and a "clearing agency" registered pursuant to the
provisions of Section 17A of the Exchange Act. DTC was created to hold security
for its Participants and facilitates the clearance and settlement of security
transactions between Participants through electronic book-entry changes in
accounts of its Participants, thereby eliminating the need for physical movement
of certificates. Participants include security brokers and dealers, banks, trust
companies and clearing corporations and certain other organizations. Indirect
access to the DTC system is available to others such as banks, brokers, dealers
and trust companies that clear through or maintain a custodial relationship with
a Participant, either directly or indirectly ("Indirect Participants").
Although DTC, Euroclear and Cedel are expected to follow the foregoing
procedures in order to facilitate transfers of interests among Participants of
DTC, Euroclear and Cedel, they are under no obligation to perform such
procedures, and such procedures may be discontinued at any time. Neither the
Company nor the Trustee will have any responsibility for the performance by DTC,
Euroclear or Cedel or their respective direct or indirect participants of their
respective obligations under the rules and procedures governing their
operations.
Certificated Securities. Interests in the Global Security will be
exchanged for certificated securities if (i) DTC notifies the Company that it is
unwilling or unable to continue as depositary for the Global Security, or DTC
ceases to be a "Clearing Agency" registered under the Exchange Act, and a
successor depositary is not appointed by the Company within 40 days, or (ii) an
Event of Default has occurred and is continuing with respect to the Notes. Upon
the occurrence of any of the events described in the preceding sentence, the
Company will cause the appropriate certificated securities to be delivered.
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<PAGE> 28
THE EXCHANGE OFFER
PURPOSE AND EFFECT OF THE EXCHANGE OFFER
The Old Notes were originally sold by the Company on May 20, 1998 to the
Initial Purchasers pursuant to the Purchase Agreement. The Initial Purchasers
subsequently resold the Old Notes to qualified institutional buyers in reliance
on Rule 144A under the Securities. As a condition to the Purchase Agreement, the
Company and the Initial Purchasers entered into the Registration Rights
Agreement on May 20, 1998, the date of the Initial Offering (the "Issue Date").
The Registration Rights Agreement provides that: (i) unless the Exchange
Offer would not be permitted by applicable law or Commission policy, the Company
will file the Exchange Offer Registration Statement with the Commission on or
prior to 60 days after the Issue Date, (ii) unless the Exchange Offer would not
be permitted by applicable law or Commission policy, the Company will use its
best efforts to have the Exchange Offer Registration Statement declared
effective by the Commission on or prior to 150 days after the Issue Date and
(iii) unless the Exchange Offer would not be permitted by applicable law or
Commission policy, the Company will commence the Exchange Offer and use its best
efforts to issue, on or prior to 45 days after the date on which the Exchange
Offer Registration Statement was declared effective by the Commission, Exchange
Notes in exchange for all Notes tendered prior thereto in the Exchange Offer.
The Exchange Offer is being made to satisfy certain of the contractual
obligations of the Company under the Registration Rights Agreement and the
Purchase Agreement.
If the Company fails to issue Exchange Notes in exchange for all Notes
properly tendered and not withdrawn in the Exchange Offer within 45 days of the
effective date of the Exchange Offer Registration Statement (a "Registration
Default"), then the Company shall pay as liquidated damages additional interest
("Additional Interest") on the Notes as to which the Registration Default exists
as set forth herein. If a Registration Default exists with respect to the Notes,
the interest rate on such Notes will increase, with respect to the first 90-day
period (or portion thereof) while a Registration Default is continuing
immediately following the occurrence of such Registration Default, .25% per
annum, such interest rate increasing by an additional .25% per annum at the
beginning of each subsequent 90-day period (or portion thereof) while a
Registration Default is continuing until all Registration Defaults have been
cured, up to a maximum rate of Additional Interest of 1.00% per annum. Upon the
issuance of Exchange Notes in exchange for all Notes properly tendered and not
withdrawn in the Exchange Offer, Additional Interest as a result of the
Registration Default shall cease to accrue (but any accrued amount shall be
payable) and the interest rate on the Notes will revert to the original rate.
Following the consummation of the Exchange Offer, holders of the Old Notes
who were eligible to participate in the Exchange Offer but who did not tender
their Old Notes will not have any further registration rights and such Old Notes
will continue to be subject to certain restrictions on transfer. Accordingly,
the liquidity of the market for such Old Notes could be adversely affected.
If (i) the Company is not permitted to consummate the Exchange Offer
because the Exchange Offer is not permitted by applicable law or Commission
policy, (ii) the Exchange Offer is not for any other reason consummated within
180 days after the Issue Date, (iii) any holder of Notes notifies the Company
within a specified time period that (a) due to a change in law or policy it is
not entitled to participate in the Exchange Offer, (b) due to a change in law or
policy it may not resell the Exchange Notes acquired by it in the Exchange Offer
to the public without delivering a prospectus and the prospectus contained in
the Exchange Offer Registration Statement is not appropriate or available for
such resales by such holder or (c) it is a broker-dealer and owns Notes acquired
directly from the Company or an affiliate of the Company, or (iv) the holders of
a majority in aggregate principal amount of the Notes may not resell the
Exchange Notes acquired by them in the Exchange Offer to the public without
restriction under the Securities Act and without restriction under applicable
blue sky or state securities laws, the Company will file with the Commission a
shelf registration statement to cover resales of the Transfer Restricted Notes
(as defined herein) by the holders hereto. The Company will use its best efforts
to cause the applicable registration statement to be declared effective as
promptly as possible by the Commission.
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<PAGE> 29
For purposes of the foregoing, "Transfer Restricted Notes" means each Note
until (i) the date on which such Note has been exchanged by a person other than
a broker-dealer referred to in (ii) below for an Exchange Note in the Exchange
Offer, (ii) following the exchange by a broker-dealer in the Exchange Offer of a
Note for an Exchange Note, the date on which such Exchange Note is sold to a
purchaser who receives from such broker-dealer on or prior to the date of such
sale a copy of the prospectus contained in the Exchange Offer Registration
Statement, as amended or supplemented, (iii) the date on which such Note has
been effectively registered under the Securities Act and disposed of in
accordance with the shelf registration statement, (iv) the date on which such
Note is eligible for distribution to the public pursuant to Rule 144(k) under
the Securities Act (or any similar provision then in force, but not Rule 144A
under the Securities Act), (v) the date on which such Note shall have been
otherwise transferred by the holder thereof and a new Note not bearing a legend
restricting further transfer shall have been delivered by the Company and
subsequent disposition of such Note shall not require registration or
qualification under the Securities Act or any similar state law then in force or
(vi) such Note ceases to be outstanding.
TERMS OF THE EXCHANGE OFFER
Upon the terms and subject to the conditions set forth in this Prospectus
and in the Letter of Transmittal, the Company will accept any and all Old Notes
validly tendered and not withdrawn prior to 5:00 p.m., New York City time, on
the Expiration Date. The Company will issue $1,000 principal amount of Exchange
Notes in exchange for each $1,000 principal amount of outstanding Old Notes
accepted in the Exchange Offer. Holders may tender some or all of their Old
Notes pursuant to the Exchange Offer. However, Old Notes may be tendered only in
integral multiples of $1,000.
The form and terms of the Exchange Notes are the same as the form and terms
of the Old Notes except that (i) the Exchange Notes bear a different CUSIP
Number from the Old Notes, (ii) the Exchange Notes have been registered under
the Securities Act and hence will not bear legends restricting the transfer
thereof and (iii) the holders of the Exchange Notes will not be entitled to
certain rights under the Registration Rights Agreement, including the provisions
providing for an increase in the interest rate on the Old Notes in certain
circumstances relating to the timing of the Exchange Offer, all of which rights
will terminate when the Exchange Offer is terminated. The Exchange Notes will
evidence the same debt as the Old Notes and will be entitled to the benefits of
the Indenture.
The Exchange Offer is not conditioned upon any minimum principal amount of
Old Notes being tendered. As of the date of this Prospectus, $500,000,000
aggregate principal amount of Old Notes were outstanding.
Holders of Old Notes do not have any appraisal or dissenters' rights under
the Pennsylvania Business Corporation Law or the Indenture in connection with
the Exchange Offer. The Company intends to conduct the Exchange Offer in
accordance with the applicable requirements of the Exchange Act and the rules
and regulations of the Commission thereunder.
The Company shall be deemed to have accepted validly tendered Old Notes
when, as and if the Company has given oral or written notice thereof to the
Exchange Agent. The Exchange Agent will act as agent for the tendering holders
for the purpose of receiving the Exchange Notes from the Company.
If any tendered Old Notes are not accepted for exchange because of an
invalid tender, the occurrence of certain other events set forth herein or
otherwise, the certificates for any such unaccepted Old Notes will be returned,
without expense, to the tendering holder thereof as promptly as practicable
after the Expiration Date.
Holders who tender Old Notes in the Exchange Offer will not be required to
pay brokerage commissions or fees or, subject to the instructions in the Letter
of Transmittal, transfer taxes with respect to the exchange of Old Notes
pursuant to the Exchange Offer. The Company will pay all charges and expenses,
other than transfer taxes in certain circumstances, in connection with the
Exchange Offer. See "-- Fees and Expenses."
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<PAGE> 30
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The term "Expiration Date" shall mean 5:00 p.m., New York City time, on
, 1998, unless the Company, in its sole discretion, extends the
Exchange Offer, in which case the term "Expiration Date" shall mean the latest
date and time to which the Exchange Offer is extended.
The Company reserves the right, in its sole discretion, (i) to delay
accepting any Old Notes, to extend the Exchange Offer or to terminate the
Exchange Offer if any of the conditions set forth below under "-- Conditions"
shall not have been satisfied, by giving oral or written notice of such delay,
extension or termination to the Exchange Agent or (ii) to amend the terms of the
Exchange Offer in any manner. Any such delay in acceptance, extension,
termination or amendment will be followed as promptly as practicable by oral or
written notice thereof to the registered holders.
Any such extension, delay in acceptance, termination or amendment will be
followed promptly by oral (confirmed in writing) or written notice thereof to
the Exchange Agent and by making a public announcement thereof, and such
announcement in the case of an extension will be made no later than 9:00 a.m.,
New York City time, on the next business day after the previously scheduled
Expiration Date. Without limiting the manner in which the Company may choose to
make any public announcement and subject to applicable law, the Company shall
have no obligation to publish, advertise or otherwise communicate any such
public announcement other than by issuing a press release to an appropriate news
agency.
INTEREST ON THE EXCHANGE NOTES
The Exchange Notes will bear interest from their date of issuance. Holders
of Old Notes that are accepted for exchange will receive, in cash, accrued
interest thereon to, but not including, the date of issuance of the Exchange
Notes. Such interest will be paid with the first interest payment on the
Exchange Notes on November 20, 1998. Interest on the Old Notes accepted for
exchange will cease to accrue upon issuance of the Exchange Notes.
Interest on the Exchange Notes is payable semi-annually on each May 20 and
November 20, commencing on November 20, 1998.
PROCEDURES FOR TENDERING
Only a holder of Old Notes may tender such Old Notes in the Exchange Offer.
For a holder to validly tender Old Notes pursuant to the Exchange Offer, a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof), with any required signature guarantee, or (in the case of a book-entry
transfer) an Agent's Message in lieu of the Letter of Transmittal, and any other
required documents must be received by the Exchange Agent at the address set
forth under "Exchange Agent" prior to 5:00 p.m., New York City time, on the
Expiration Date. In addition, prior to 5:00 p.m., New York City time, on the
Expiration Date, either (a) certificates for tendered Old Notes must be received
by the Exchange Agent at such address or (b) such Old Notes must be transferred
pursuant to the procedures for book-entry transfer described below (and a
confirmation of such tender received by the Exchange Agent, including an Agent's
Message if the tendering holder has not delivered a Letter of Transmittal). The
term "Agent's Message" means a message, transmitted by the book-entry transfer
facility, The Depository Trust Company (the "Book-Entry Transfer Facility"), to
and received by the Exchange Agent and forming a part of a book-entry
confirmation, which states that the Book-Entry Transfer Facility has received an
express acknowledgment from the tendering participant that such participant has
received and agrees to be bound by the Letter of Transmittal and that the
Company may enforce such Letter of Transmittal against such participant.
By tendering, each holder of Old Notes will represent to the Company that,
among other things, (i) the Exchange Notes to be acquired by such holder of Old
Notes in connection with the Exchange Offer are being acquired by such holder in
the ordinary course of business of such holder, (ii) such holder is not
participating, does not intend to participate, and has no arrangement or
understanding with any person to participate, in the distribution of the
Exchange Notes, (iii) except as otherwise disclosed in writing, such holder is
not an "affiliate," as defined in Rule 405 under the Securities Act, of the
Company, and (iv) such holder
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<PAGE> 31
acknowledges and agrees that any person participating in the Exchange Offer with
the intention or for the purpose of distributing the Exchange Notes must comply
with the registration and prospectus delivery requirements of the Securities Act
in connection with a secondary resale of the Exchange Notes acquired by such
person and cannot rely on the position of the Staff of the Commission set forth
in the no-action letters that are discussed under "Resale of the Exchange
Notes." In addition, by accepting the Exchange Offer, such holder will (i)
represent and warrant that, if such holder is a Participating Broker-Dealer,
such Participating Broker-Dealer acquired the Old Notes for its own account as a
result of market-making activities or other trading activities and has not
entered into any arrangement or understanding with the Company or any
"affiliate" of the Company (within the meaning of Rule 405 under the Securities
Act) to distribute the Exchange Notes to be received in the Exchange Offer, and
(ii) acknowledges that, by receiving Exchange Notes for its own account in
exchange for Old Notes, where such Old Notes were acquired as a result of
market-making activities or other trading activities, such Participating
Broker-Dealer will deliver a prospectus meeting the requirements of the
Securities Act in connection with any resale of such Exchange Notes.
The tender by a holder and the acceptance thereof by the Company will
constitute agreement between such holder and the Company in accordance with the
terms and subject to the conditions set forth herein and in the Letter of
Transmittal.
THE METHOD OF DELIVERY OF OLD NOTES AND THE LETTER OF TRANSMITTAL AND ALL
OTHER REQUIRED DOCUMENTS TO THE EXCHANGE AGENT IS AT THE ELECTION AND SOLE RISK
OF THE HOLDER. AS AN ALTERNATIVE TO DELIVERY BY MAIL, HOLDERS MAY WISH TO
CONSIDER OVERNIGHT OR HAND DELIVERY SERVICE. IN ALL CASES, SUFFICIENT TIME
SHOULD BE ALLOWED TO ASSURE DELIVERY TO THE EXCHANGE AGENT BEFORE THE EXPIRATION
DATE. NO LETTER OF TRANSMITTAL OR OLD NOTES SHOULD BE SENT TO THE COMPANY.
HOLDERS MAY REQUEST THEIR RESPECTIVE BROKERS, DEALERS, COMMERCIAL BANKS, TRUST
COMPANIES OR NOMINEES TO EFFECT THE ABOVE TRANSACTIONS FOR SUCH HOLDERS.
Any beneficial owner whose Old Notes are registered in the name of a
broker, dealer, commercial bank, trust company or other nominee and who wishes
to tender should contact the registered holder promptly and instruct such
registered holder to tender on such beneficial owner's behalf. See "Instructions
to Registered Holder and/or Book-Entry Transfer Facility Participant from
Beneficial Owner" included with the Letter of Transmittal.
Signatures on a Letter of Transmittal or a notice of withdrawal, as the
case may be, must be guaranteed by a recognized participant in the Securities
Transfer Agent Medallion Program, the New York Stock Exchange Medallion
Signature Program or the Stock Exchange Medallion Program (each a "Medallion
Signature Guarantor"), unless the Old Notes tendered pursuant thereto are
tendered (i) by a registered holder who has not completed the box entitled
"Special Delivery Instructions" on the Letter of Transmittal or (ii) for the
account of a member firm of a registered national securities exchange, a member
of the NASD or a commercial bank or trust company having an office or
correspondent in the United States (each of the foregoing being an "Eligible
Institution").
If the Letter of Transmittal is signed by a person other than the
registered holder of any Old Notes listed therein, such Old Notes must be
endorsed or accompanied by a properly completed bond power, signed by such
registered holder as such registered holder's name appears on such Old Notes
with the signature thereon guaranteed by a Medallion Signature Guarantor.
If the Letter of Transmittal or any Old Notes or bond powers are signed by
trustees, executors, administrators, guardians, attorneys-in-fact, offices of
corporations or others acting in a fiduciary or representative capacity, such
persons should so indicate when signing, and evidence satisfactory to the
Company of their authority to so act must be submitted with the Letter of
Transmittal.
The Company understands that the Exchange Agent will make a request
promptly after the date of this Prospectus to establish accounts with respect to
the Old Notes at the Book-Entry Transfer Facility for the purpose of
facilitating the Exchange Offer, and subject to the establishment thereof, any
financial institution
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<PAGE> 32
that is a participant in the Book-Entry Transfer Facility's system may make
book-entry delivery of Old Notes by causing such Book-Entry Transfer Facility to
transfer such Old Notes into the Exchange Agent's account with respect to the
Old Notes in accordance with the Book-Entry Transfer Facility's procedures for
such transfer. Although delivery of the Old Notes may be effected through
book-entry transfer into the Exchange Agent's account at the Book-Entry Transfer
Facility, an appropriate Letter of Transmittal properly completed and duly
executed with any required signature guarantee (or, in the case of book-entry
transfer, an Agent's Message in lieu thereof) and all other required documents
must in each case be transmitted to and received or confirmed by the Exchange
Agent at its address set forth below on or prior to the Expiration Date, or, if
the guaranteed delivery procedures described below are complied with, within the
time period provided under such procedures. Delivery of documents to the
Book-Entry Transfer Facility does not constitute delivery to the Exchange Agent.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance of tendered Old Notes and withdrawal of tendered Old Notes
will be determined by the Company in its sole discretion, which determination
will be final and binding. The Company reserves the absolute right to reject any
and all Old Notes not properly tendered or any Old Notes the Company's
acceptance of which would, in the opinion of counsel for the Company, be
unlawful. The Company also reserves the right in its sole discretion to waive
any defects, irregularities or conditions of tender as to particular Old Notes.
The Company's interpretation of the terms and conditions of the Exchange Offer
(including the instructions in the Letter of Transmittal) will be final and
binding on all parties. Unless waived, any defects or irregularities in
connection with tenders of Old Notes must be cured within such time as the
Company shall determine. Although the Company intends to notify holders of
defects or irregularities with respect to tenders of Old Notes, neither the
Company, the Exchange Agent nor any other person shall incur any liability for
failure to give such notification. Tenders of Old Notes will not be deemed to
have been made until such defects or irregularities have been cured or waived.
Any Old Notes received by the Exchange Agent that are not properly tendered and
as to which the defects or irregularities have not been cured or waived will be
returned by the Exchange Agent to the tendering holders, unless otherwise
provided in the Letter of Transmittal, as soon as practicable following the
Expiration Date.
GUARANTEED DELIVERY PROCEDURES
Holders who wish to tender their Old Notes and (i) whose Old Notes are not
immediately available, (ii) who cannot deliver their Old Notes, the Letter of
Transmittal (or, in the case of book-entry transfer, an Agent's Message) or any
other required documents to the Exchange Agent or (iii) who cannot complete the
procedures for book-entry transfer (including delivery of an Agent's Message),
prior to the Expiration Date, may effect a tender if:
(a) the tender is made through an Eligible Institution;
(b) prior to the Expiration Date, the Exchange Agent receives from
such Eligible Institution (i) an Agent's Message with respect to guaranteed
delivery that is accepted by the Company, or (ii) a properly completed and
duly executed Notice of Guaranteed Delivery (by facsimile transmission,
mail or hand delivery) setting forth the name and address of the holder,
the certificate number(s) of such Old Notes and the principal amount of Old
Notes tendered, stating that the tender is being made thereby and
guaranteeing that, within three New York Stock Exchange trading days after
the Expiration Date, the Letter of Transmittal (or facsimile thereof)
together with the certificate(s) representing the Old Notes (or a
confirmation of book-entry transfer of such Notes into the Exchange Agent's
account at the Book-Entry Transfer Facility), and any other documents
required by the Letter of Transmittal will be deposited by the Eligible
Institution with the Exchange Agent; and
(c) such properly completed and executed Letter of Transmittal or
facsimile thereof (or, in the case of book-entry transfer, an Agent's
Message), as well as the certificate(s) representing all tendered Old Notes
in proper form for transfer (or a confirmation of book-entry transfer of
such Old Notes into the Exchange Agent's account at the Book-Entry Transfer
Facility), and all other documents required by the Letter of Transmittal
are received by the Exchange Agent within three New York Stock Exchange
trading days after the Expiration Date.
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<PAGE> 33
Upon request to the Exchange Agent, a Notice of Guaranteed Delivery will be
sent to holders who wish to tender their Old Notes according to the guaranteed
delivery procedures set forth above.
WITHDRAWAL OF TENDERS
Except as otherwise provided herein, tenders of Old Notes may be withdrawn
at any time prior to 5:00 p.m., New York City time, on the Expiration Date.
To withdraw a tender of Old Notes in the Exchange Offer, a letter or
facsimile transmission notice of withdrawal must be received by the Exchange
Agent at its address set forth herein prior to 5:00 p.m., New York City time, on
the Expiration Date. Any such notice of withdrawal must (i) specify the name of
the person having deposited the Old Notes to be withdrawn (the "Depositor"),
(ii) identify the Old Notes to be withdrawn (including the certificate number(s)
and principal amount of such Old Notes, or, in the case of Old Notes transferred
by book-entry transfer, the name and number of the account at the Book-Entry
Transfer Facility to be credited), (iii) be signed by the holder in the same
manner as the original signature on the Letter of Transmittal by which such Old
Notes were tendered (including any required signature guarantees) or be
accompanied by documents of transfer sufficient to have the Trustee with respect
to the Old Notes register the transfer of such Old Notes into the name of the
person withdrawing the tender and (iv) specify the name in which any such Old
Notes are to be registered, if different from that of the Depositor. All
questions as to the validity, form and eligibility (including time of receipt)
of such notices will be determined by the Company, whose determination shall be
final and binding on all parties. Any Old Notes so withdrawn will be deemed not
to have been validly tendered for purposes of the Exchange Offer and no Exchange
Notes will be issued with respect thereto unless the Old Notes so withdrawn are
validly retendered. Any Old Notes which have been tendered but which are not
accepted for exchange will be returned to the holder thereof without cost to
such holder as soon as practicable after withdrawal, rejection of tender or
termination of the Exchange Offer. Properly withdrawn Old Notes may be
retendered by following one of the procedures described above under
"-- Procedures for Tendering" at any time prior to the Expiration Date.
CONDITIONS
Notwithstanding any other term of the Exchange Offer, the Company shall not
be required to accept for exchange, or exchange Exchange Notes for, any Old
Notes, and may terminate or amend the Exchange Offer as provided herein before
the acceptance of such Old Notes, if:
(a) any action or proceeding is instituted or threatened in any court
or by or before any governmental agency with respect to the Exchange Offer
which, in the sole judgment of the Company, might materially impair the
ability of the Company to proceed with the Exchange Offer or any material
adverse development has occurred in any existing action or proceeding with
respect to the Company or any of its subsidiaries;
(b) any law, statute, rule, regulation or interpretation by the staff
of the Commission is proposed, adopted or enacted, which, in the sole
judgment of the Company, might materially impair the ability of the Company
to proceed with the Exchange Offer or materially impair the contemplated
benefits of the Exchange Offer to the Company; or
(c) any governmental approval has not been obtained, which approval
the Company shall, in its sole discretion, deem necessary for the
consummation of the Exchange Offer as contemplated hereby.
If the Company determines in its sole discretion that any of the conditions
are not satisfied, the Company may (i) refuse to accept any Old Notes and return
all tendered Old Notes to the tendering holders, (ii) extend the Exchange Offer
and retain all Old Notes tendered prior to the expiration of the Exchange Offer,
subject, however, to the rights of holders to withdraw such Old Notes (see
"-- Withdrawal of Tenders") or (iii) waive such unsatisfied conditions with
respect to the Exchange Offer and accept all properly tendered Old Notes which
have not been withdrawn.
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<PAGE> 34
EXCHANGE AGENT
Citibank, N.A. has been appointed as Exchange Agent for the Exchange Offer.
Questions and requests for assistance, requests for additional copies of this
Prospectus or of the Letter of Transmittal and requests for Notice of Guaranteed
Delivery should be directed to the Exchange Agent addressed as follows:
CITIBANK, N.A.
<TABLE>
<S> <C> <C>
By Mail: By Overnight Delivery: By Hand:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
c/o Citicorp Data Distributions, Inc. c/o Citicorp Data Distributions, Inc. Corporate Trust Window
P.O. Box 7072 404 Sette Drive 111 Wall Street, 5th Floor
Paramus, New Jersey 07653 Paramus, New Jersey 07652 New York, New York 10043
Facsimile for Eligible Institutions:
(201) 262-3240
Facsimile Confirmation Only:
(800) 422-2077
For Information:
(800) 422-2077
</TABLE>
DELIVERY TO AN ADDRESS OTHER THAN SET FORTH ABOVE WILL NOT CONSTITUTE A
VALID DELIVERY.
FEES AND EXPENSES
The expenses of soliciting tenders will be borne by the Company. The
principal solicitation is being made by mail; however, additional solicitation
may be made by telegraph, telecopy, telephone or in person by officers and
regular employees of the Company and its affiliates or their agents.
The Company has not retained any dealer-manager in connection with the
Exchange Offer and will not make any payments to brokers, dealers, or others
soliciting acceptances of the Exchange Offer. The Company, however, will pay the
Exchange Agent reasonable and customary fees for its services and will reimburse
it for its reasonable out-of-pocket expenses in connection therewith.
The cash expenses to be incurred in connection with the Exchange Offer will
be paid by the Company. Such expenses include fees and expenses of the Exchange
Agent and Trustee, accounting and legal fees and printing costs, among others.
ACCOUNTING TREATMENT
The Exchange Notes will be recorded at the same carrying value as the Old
Notes, which is the original principal amount, plus accretion thereon, as
reflected in the Company's accounting records on the date of exchange.
Accordingly, no gain or loss for accounting purposes will be recognized by the
Company. Certain expenses of the Exchange Offer will be amortized over the term
of the Exchange Notes.
CONSEQUENCES OF FAILURE TO EXCHANGE
The Old Notes that are not exchanged for Exchange Notes pursuant to the
Exchange Offer will remain restricted securities. Accordingly, such Old Notes
may be resold only (i) to the Company (upon redemption thereof or otherwise),
(ii) so long as the Old Notes are eligible for resale pursuant to Rule 144A, to
a person inside the United States whom the seller reasonably believes is a
qualified institutional buyer within the meaning of Rule 144A under the
Securities Act in a transaction meeting the requirements of Rule 144A, in
accordance with Rule 144 under the Securities Act, or pursuant to another
exemption from the registration requirements of the Securities Act (and based
upon an opinion of counsel reasonably acceptable to the Company), (iii) outside
the United States to a foreign person in a transaction meeting the requirements
of Rule 904 under the Securities Act, or (iv) pursuant to an effective
registration statement under the Securities Act, in each case in accordance with
any applicable securities laws of any state of the United States.
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<PAGE> 35
RESALE OF THE EXCHANGE NOTES
With respect to resales of Exchange Notes, based on interpretations by the
staff of the Commission set forth in no-action letters issued to third parties,
the Company believes that a holder or other person who receives Exchange Notes,
whether or not such person is the holder (other than a person that is an
"affiliate" of the Company within the meaning of Rule 405 under the Securities
Act) who receives Exchange Notes in exchange for Old Notes in the ordinary
course of business and who is not participating, does not intend to participate,
and has no arrangement or understanding with any person to participate, in the
distribution of the Exchange Notes, will be allowed to resell the Exchange Notes
to the public without further registration under the Securities Act and without
delivering to the purchasers of the Exchange Notes a prospectus that satisfies
the requirements of Section 10 of the Securities Act. However, if any holder
acquires Exchange Notes in the Exchange Offer for the purpose of distributing or
participating in a distribution of the Exchange Notes, such holder cannot rely
on the position of the staff of the Commission enunciated in such no-action
letters or any similar interpretive letters, and must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any resale transaction, unless an exemption from registration is
otherwise available. Further, each Participating Broker-Dealer that receives
Exchange Notes for its own account in exchange for Old Notes, where such Old
Notes were acquired by such Participating Broker-Dealer as a result of
market-making activities or other trading activities, must acknowledge that it
will deliver a prospectus in connection with any resale of such Exchange Notes.
The Letter of Transmittal states that by so acknowledging and by delivering a
prospectus, a Participating Broker-Dealer will not be deemed to admit that it is
an "underwriter" within the meaning of the Securities Act. For a description of
the procedures for such resales by Participating Broker-Dealers, see "Plan of
Distribution."
CERTAIN U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following discussion, insofar as it describes statements of law or
legal conclusions, fairly describes the material U.S. federal income tax
consequences expected to result to holders whose Old Notes are exchanged for
Exchange Notes in the Exchange Offer. This discussion is based on the current
provisions of the Internal Revenue Code of 1986, as amended (the "Code"),
applicable Treasury regulations, judicial authority and administrative rulings
and practice. There can be no assurance that the Internal Revenue Service (the
"Service") will not take a contrary view, and no ruling from the Service has
been or will be sought. Legislative, judicial or administrative changes or
interpretations may be forthcoming that could alter or modify the statements and
conditions set forth herein. Any such changes or interpretations may or may not
be retroactive and could affect the tax consequences to holders. Certain holders
(including insurance companies, tax-exempt organizations, financial
institutions, broker-dealers, foreign corporations and persons who are not
citizens or residents of the United States) may be subject to special rules not
discussed below.
For U.S. federal income tax purposes, the exchange of Old Notes for
Exchange Notes pursuant to the Exchange Offer will not be treated as a taxable
transaction for federal income tax purposes. As a result, there will be no
federal income tax consequences to holders exchanging Old Notes for Exchange
Notes pursuant to the Exchange Offer. A holder will have the same adjusted basis
and holding period in the Exchange Notes as it had in the Old Notes immediately
before the exchange.
THE FOREGOING DISCUSSION IS BASED ON THE PROVISIONS OF THE CODE,
REGULATIONS, TREASURY REGULATIONS, RULING AND JUDICIAL DECISIONS NOW IN EFFECT,
ALL OF WHICH ARE SUBJECT TO CHANGE. ANY SUCH CHANGES MAY BE APPLIED
RETROACTIVELY IN A MANNER THAT COULD ADVERSELY AFFECT HOLDERS EXCHANGING NOTES.
EACH HOLDER OF NOTES SHOULD CONSULT ITS OWN TAX ADVISOR WITH RESPECT TO THE TAX
CONSEQUENCES TO IT, INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN
AND OTHER TAX LAWS, OF EXCHANGING OLD NOTES FOR EXCHANGE NOTES PURSUANT TO THE
EXCHANGE OFFER.
32
<PAGE> 36
PLAN OF DISTRIBUTION
Each Participating Broker-Dealer that receives Exchange Notes for its own
account pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Notes. This
Prospectus, as it may be amended or supplemented from time to time, may be used
by a Participating Broker-Dealer in connection with resales of Exchange Notes
received in exchange for Old Notes where such Old Notes were acquired as a
result of market-making activities or other trading activities. The Company has
agreed that for a period of 90 days after the Expiration Date, they will make
this Prospectus, as amended or supplemented, available to any Participating
Broker-Dealer for use in connection with any such resale. In addition, until
, 1998 (90 days after the commencement of the Exchange Offer), all
dealers effecting transactions in the Exchange Notes may be required to deliver
a prospectus.
The Company will not receive any proceeds from any sales of the Exchange
Notes by Participating Broker-Dealers. Exchange Notes received by Participating
Broker-Dealers for their own account pursuant to the Exchange Offer may be sold
from time to time in one or more transactions in the over-the-counter market, in
negotiated transactions, through the writing of options on the Exchange Notes or
a combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such Participating Broker-Dealer and/or the purchasers of
any such Exchange Notes. Any Participating Broker-Dealer that resells the
Exchange Notes that were received by it for its own account pursuant to the
Exchange Offer and any broker or dealer that participates in a distribution of
such Exchange Notes may be deemed to be an "underwriter" within the meaning of
the Securities Act and any profit on any such resale of Exchange Notes and any
commissions or concessions received by any such persons may be deemed to be
underwriting compensation under the Securities Act. The Letter of Transmittal
states that by acknowledging that it will deliver and by delivering a
prospectus, a Participating Broker-Dealer will not be deemed to admit that it is
an "underwriter" within the meaning of the Securities Act.
For a period of 90 days after the Expiration Date the Company will promptly
send additional copies of this Prospectus and any amendment or supplement to
this Prospectus to any Participating Broker-Dealer that requests such documents
in the Letter of Transmittal.
LEGAL MATTERS
The validity of the Notes being offered hereby are being passed upon for
the Company by Louis J. Briskman, Esq., Executive Vice President and General
Counsel of the Company. Certain other matters in connection with the Exchange
Offer are being passed upon for the Company by Weil Gotshal & Manges LLP, New
York, New York.
EXPERTS
The consolidated financial statements of the Company as of December 31,
1997 and December 31, 1996 and for the years then ended and as of December 31,
1995 and for the year then ended, have been audited by KPMG Peat Marwick LLP and
PricewaterhouseCoopers LLP, independent certified public accountants,
respectively, as stated in their reports appearing elsewhere, and incorporated
by reference herein.
33
<PAGE> 37
===================================================
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS. IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE
SECURITIES TO WHICH IT RELATES, OR AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY SUCH SECURITIES IN ANY JURISDICTION WHERE, OR TO ANY PERSON TO
WHOM, IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF
THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE
ANY IMPLICATION THAT THERE HAS NOT BEEN ANY CHANGE IN THE INFORMATION CONTAINED
IN THIS PROSPECTUS OR IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information............... 2
Documents Incorporated by
Reference......................... 2
Summary............................. 3
Risk Factors........................ 11
Use of Proceeds..................... 14
Capitalization...................... 15
Selected Financial and Operating
Data.............................. 16
Description of Notes................ 17
Book-Entry; Delivery and Form....... 23
The Exchange Offer.................. 25
Certain U.S. Federal Income Tax
Considerations.................... 32
Plan of Distribution................ 33
Legal Matters....................... 33
Experts............................. 33
</TABLE>
===================================================
===================================================
$500,000,000
LOGO
7.15% SENIOR NOTES DUE 2005
---------------------------------
PROSPECTUS
---------------------------------
, 1998
===================================================
<PAGE> 38
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
CBS Corporation (the "Company") is incorporated under the laws of the
Commonwealth of Pennsylvania.
Section 1741 of the Pennsylvania Business Corporation Law ("PBCL") empowers
a corporation to indemnify any person who was or is a party or is threatened to
be made a party to any threatened, pending or completed action or proceeding (a
"Proceeding"), whether civil, criminal, administrative or investigative (other
than an action by or in the right of the Company), by reason of the fact that
such person is or was a representative of the corporation or is or was serving
at the request of the corporation as a representative of another corporation or
enterprise, against expenses (including attorneys' fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by him or her in
connection with such Proceeding, if he or she acted in good faith and in a
manner he or she reasonably believed to be in, or not opposed to, the best
interests of the corporation and, with respect to any criminal proceeding, had
no reasonable cause to believe his or her conduct was unlawful. Section 1742 of
the PBCL empowers a corporation to indemnify any person who was or is a party,
or is threatened to be made a party, to any threatened, pending or completed
action by or in the right of the corporation to procure a judgment in its favor
by reason of the fact that such person is or was a representative of the
corporation or is or was serving at the request of the corporation as a
representative of another corporation or enterprise, against expenses (including
attorneys' fees) actually and reasonably incurred by him or her in connection
with the defense or settlement of the action if he or she acted in good faith
and in a manner he or she reasonably believed to be in, or not opposed to, the
best interests of the corporation, provided that indemnification will not be
made in respect of any claim, issue or matter as to which such person has been
adjudged to be liable to the corporation unless there is a judicial
determination that in view of all the circumstances of the case, the person is
fairly and reasonably entitled to indemnity for the expenses that the court
deems proper.
Section 1743 of the PBCL provides that to the extent that a representative
of a corporation has been successful on the merits or otherwise in defense of
any Proceeding, or in defense of any claim, issue or matter therein, he or she
will be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection therewith.
Section 1745 of the PBCL provides that expenses (including attorneys' fees)
incurred in defending a Proceeding may be paid by the corporation in advance of
the final disposition of such Proceeding upon receipt of an undertaking by or on
behalf of the representative to repay such amount if it is ultimately determined
that he or she is not entitled to be indemnified by the corporation.
Section 1746 of the PBCL provides that the indemnification and advancement
of expenses provided by, or granted pursuant to, the other sections of the PBCL
will not be deemed exclusive of any other rights to which a person seeking
indemnification or advancement of expenses may be entitled under any by-law,
agreement, vote of shareholders or disinterested directors or otherwise.
However, Section 1746 also provides that such indemnification will not be made
in any case where the act or failure to act giving rise to the claim for
indemnification is determined by a court to have constituted willful misconduct
or recklessness.
The Company provides for indemnification of its directors and officers
pursuant to Article ELEVENTH of its Articles of Incorporation and Article
XVII(B) of the Company's By-laws. Article ELEVENTH of the Company's Articles of
Incorporation and Article XVII(B) of the Company's By-laws provide in effect
that, with respect to Proceedings based on acts or omissions on or after January
27, 1987, and unless prohibited by applicable law, the Company will indemnify
directors and officers against all expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement incurred in connection with any
such Proceedings (subject to certain limitations in the case of actions by such
persons against the Company). Under Article XVII(B), the Company will also
advance amounts to any director or officer during the pendency of any such
Proceedings against expenses incurred in connection with such Proceedings,
provided that, if
II-1
<PAGE> 39
required by law, the Company receives an undertaking to repay such amount if it
is ultimately determined that such person is not entitled to be indemnified
under such Article. The indemnification provided for in such Articles is in
addition to any rights to which any director or officer may otherwise be
entitled. Article XVII(B) of the Company's By-laws provides that the right of a
director or officer to such indemnification and advancement of expenses will be
a contract right and further provides procedures for the enforcement of such
right.
As authorized by Article ELEVENTH of its Articles, the Company has
purchased directors' and officers' liability insurance policies indemnifying its
directors and officers and the directors and officers of its subsidiaries
against claim and liabilities (with stated exceptions) to which they may become
subject by reason of their positions with the Company or its subsidiaries as
directors and officers.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(A) EXHIBITS
<TABLE>
<S> <C> <C> <C>
3(a) -- Restated Articles of Incorporation of the Company, as
amended to December 11, 1997 (filed as Exhibit 3(b) to the
Company's Annual Report on Form 10-K for the year ended
December 31, 1997) (the "1997 10-K").*
(b) -- By-laws of the Company, as amended to May 6, 1998 (filed as
Exhibit 4.2 to Post-effective Amendment No. 1 to the
Company's Registration Statement No. 333-30127 on Form
S-8).*
4(a) -- Indenture for the 7.15% Senior Notes due 2005 (the "Old
Notes") and 7.15% Senior Notes due 2005, (the "Exchange
Notes"), dated as of May 20, 1998 between the Company and
Citibank, N.A., as trustee.
(b) -- Form of Old Note (included in Exhibit 4(a)).
(c) -- Form of Exchange Note (included in Exhibit 4(a)).
(d) -- Registration Rights Agreement dated as of May 20, 1998 among
the Company and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Chase Securities Inc. and J.P. Morgan
Securities Inc.
(e) -- The Company undertakes to furnish the Securities and
Exchange Commission, upon request, a copy of all instruments
with respect to long-term debt not filed herewith.
5(a) -- Opinion of Louis J. Briskman, Esq., General Counsel of the
Company, as to the validity of the Exchange Notes to be
issued by the Company.
(b) -- Opinion of Weil, Gotshal & Manges LLP.
12 -- Statement of Computation of Ratios of Earnings to Fixed
Charges.
23(a) -- Consent of KPMG Peat Marwick LLP.
(b) -- Consent of PricewaterhouseCoopers LLP.
(c) -- Consent of Louis J. Briskman, Esq. (included in the opinion
filed as Exhibit 5(a) to this Registration Statement).
(d) -- Consent of Weil, Gotshal & Manges LLP (included in the
opinion filed as Exhibit 5(b) to this Registration
Statement).
24 -- Power of Attorney (included on signature pages of this Part
II).
25 -- Statement of Eligibility and Qualification of Citibank,
N.A., as Trustee on Form T-1 with respect to the 7.15%
Senior Subordinated Notes due 2005.
99.1 -- Form of Letter of Transmittal.
99.2 -- Form of Notice of Guaranteed Delivery.
99.3 -- Form of Instructions to Registered Holders and/or Book-Entry
Facility Participant from Beneficial Owner.
99.4 -- Form of Exchange Agent Agreement.
</TABLE>
- ---------------
* Incorporated herein by reference.
II-2
<PAGE> 40
ITEM 22. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(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. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective 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.
(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 the 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) The undersigned registrant hereby undertakes 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 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the 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.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrants pursuant to the provisions, 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 a 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.
(d) The undersigned registrant hereby undertakes to respond to requests for
information that is incorporated by reference into the prospectus pursuant to
Item 4, 10(b), 11, or 13 of this form, within one business day of receipt of
such request, and to send the incorporated documents by first class mail or
other equally prompt means. This includes information contained in documents
filed subsequent to the effective date of the registration statement through the
date of responding to the request.
II-3
<PAGE> 41
(e) The undersigned registrant hereby undertakes to supply by means of a
post-effective amendment all information concerning a transaction, and the
company being acquired involved therein, that was not the subject of and
included in the registration statement when it became effective.
II-4
<PAGE> 42
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City and State of New York, on
this 7th day of July, 1998.
CBS CORPORATION
By: /s/ FREDRIC G. REYNOLDS
------------------------------------
FREDRIC G. REYNOLDS
EXECUTIVE VICE PRESIDENT AND
CHIEF FINANCIAL OFFICER
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Michael H. Jordan, Mel Karmazin, Fredric G.
Reynolds, Louis J. Briskman and Carol V. Savage, and each of them, with full
power to act without the other, his/her true and lawful attorney-in-fact and
agent, with full power of substitution and resubstitution, for him/her and in
his/her name, place and stead, in any and all capacities, to sign any or all
amendments to this Registration Statement, and to file the same, with all
exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, 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 requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he/she might or could do in
person, hereby ratifying and confirming all that said attorneys-in-fact and
agents, or any of them, or their or his/her substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons on behalf
of the Registrant named below and in the capacities indicated, on the dates
indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ MICHAEL H. JORDAN Chairman and Chief Executive July 7, 1998
- --------------------------------------------- Officer and Director (Principal
(MICHAEL H. JORDAN) Executive Officer)
/s/ FREDRIC G. REYNOLDS Executive Vice President and Chief July 7, 1998
- --------------------------------------------- Financial Officer (Principal
(FREDRIC G. REYNOLDS) Financial Officer)
/s/ CAROL V. SAVAGE Vice President and Chief July 7, 1998
- --------------------------------------------- Accounting Officer (Principal
(CAROL V. SAVAGE) Accounting Officer)
/s/ ROBERT E. CAWTHORN Director July 7, 1998
- ---------------------------------------------
(ROBERT E. CAWTHORN)
/s/ GEORGE H. CONRADES Director July 7, 1998
- ---------------------------------------------
(GEORGE H. CONRADES)
/s/ MARTIN C. DICKINSON Director July 7, 1998
- ---------------------------------------------
(MARTIN C. DICKINSON)
/s/ WILLIAM H. GRAY III Director July 7, 1998
- ---------------------------------------------
(WILLIAM H. GRAY III)
</TABLE>
II-5
<PAGE> 43
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ MEL KARMAZIN President and Chief Operating July 7, 1998
- --------------------------------------------- Officer and Director
(MEL KARMAZIN)
/s/ JAN LESCHLY Director July 7, 1998
- ---------------------------------------------
(JAN LESCHLY)
/s/ DAVID T. MCLAUGHLIN Director July 7, 1998
- ---------------------------------------------
(DAVID T. MCLAUGHLIN)
/s/ RICHARD R. PIVIROTTO Director July 7, 1998
- ---------------------------------------------
(RICHARD R. PIVIROTTO)
/s/ RAYMOND W. SMITH Director July 7, 1998
- ---------------------------------------------
(RAYMOND W. SMITH)
/s/ DR. PAULA STERN Director July 7, 1998
- ---------------------------------------------
(DR. PAULA STERN)
/s/ ROBERT D. WALTER Director July 7, 1998
- ---------------------------------------------
(ROBERT D. WALTER)
</TABLE>
II-6
<PAGE> 44
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT EXEMPTION
NUMBER DESCRIPTION INDICATION
- ------- ----------- ----------
<S> <C> <C> <C> <C>
3(a) -- Restated Articles of Incorporation of the Company, as
amended to December 11, 1997 (filed as Exhibit 3(b) to the
Company's Annual Report on Form 10-K for the year ended
December 31, 1997) (the "1997 10-K").*......................
(b) -- By-laws of the Company, as amended to May 6, 1998 (filed as
Exhibit 4.2 to Post-effective Amendment No. 1 to the
Company's Registration Statement No. 333-30127 on Form
S-8).*......................................................
4(a) -- Indenture for the 7.15% Senior Notes due 2005 (the "Old
Notes") and 7.15% Senior Notes due 2005, (the "Exchange
Notes"), dated as of May 20, 1998 between the Company and
Citibank, N.A., as trustee..................................
(b) -- Form of Old Note (included in Exhibit 4(a)).................
(c) -- Form of Exchange Note (included in Exhibit 4(a))............
(d) -- Registration Rights Agreement dated as of May 20, 1998 among
the Company and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Chase Securities Inc. and J.P. Morgan
Securities Inc. ............................................
(e) -- The Company undertakes to furnish the Securities and
Exchange Commission, upon request, a copy of all instruments
with respect to long-term debt not filed herewith...........
5(a) -- Opinion of Louis J. Briskman, Esq., General Counsel of the
Company, as to the validity of the Exchange Notes to be
issued by the Company.......................................
(b) -- Opinion of Weil, Gotshal & Manges LLP.......................
12 -- Statement of Computation of Ratios of Earnings to Fixed
Charges.....................................................
23(a) -- Consent of KPMG Peat Marwick LLP............................
(b) -- Consent of PricewaterhouseCoopers LLP.......................
(c) -- Consent of Louis J. Briskman, Esq. (included in the opinion
filed as Exhibit 5(a) to this Registration Statement).......
(d) -- Consent of Weil, Gotshal & Manges LLP (included in the
opinion filed as Exhibit 5(b) to this Registration
Statement)..................................................
24 -- Power of Attorney (included on signature pages of this Part
II).........................................................
25 -- Statement of Eligibility and Qualification of Citibank,
N.A., as Trustee on Form T-1 with respect to the 7.15%
Senior Subordinated Notes due 2005..........................
99.1 -- Form of Letter of Transmittal...............................
99.2 -- Form of Notice of Guaranteed Delivery.......................
99.3 -- Form of Instructions to Registered Holders and/or Book-Entry
Facility Participant from Beneficial Owner..................
99.4 -- Form of Exchange Agent Agreement............................
</TABLE>
- ---------------
* Incorporated herein by reference.
<PAGE> 1
EXHIBIT 4(a)
EXECUTION COPY
==================================
CBS CORPORATION
7.15% Senior Notes due 2005
===============
INDENTURE
Dated as of May 20, 1998
===============
CITIBANK, N.A.
as Trustee
==================================
<PAGE> 2
CROSS-REFERENCE TABLE
TIA Indenture
Section Section
- ------- -------
310(a)(1) ............................................. 6.10
(a)(2) ............................................. 6.10
(a)(3) ............................................. N.A.
(a)(4) ............................................. N.A.
(a)(5) ............................................. 6.8; 6.10
(b) ............................................. 6.8; 6.10
(c) ............................................. N.A.
311(a) ............................................. 6.11
(b) ............................................. 6.11
(c) ............................................. N.A.
312(a) ............................................. 2.5
(b) ............................................. 10.3
(c) ............................................. 10.3
313(a) ............................................. 6.6
(b)(1) ............................................. N.A.
(b)(2) ............................................. 6.6
(c) ............................................. 6.6
(d) ............................................. 6.6
314(a) ............................................. 3.2; 10.2
(b) ............................................. N.A.
(c)(1) ............................................. 10.4
(c)(2) ............................................. 10.4
(c)(3) ............................................. N.A.
(d) ............................................. N.A.
(e) ............................................. 10.5
(f) ............................................. 3.9
315(a) ............................................. 6.1
(b) ............................................. 6.5; 10.2
(c) ............................................. 6.1
(d) ............................................. 6.1
(e) ............................................. 5.11
316(a)(last sentence) ............................................. 10.6
(a)(1)(A) ............................................. 5.5
(a)(1)(B) ............................................. 5.4
(a)(2) ............................................. N.A.
(b) ............................................. 5.7
317(a)(1) ............................................. 5.8
(a)(2) ............................................. 5.9
(b) ............................................. 2.4
318(a) ............................................. 10.1
N.A. means Not Applicable.
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be
part of the Indenture.
<PAGE> 3
TABLE OF CONTENTS
Page
----
ARTICLE I
Definitions and Incorporation by Reference.............. 1
SECTION 1.1. Definitions........................................... 1
SECTION 1.2. Other Definitions..................................... 5
SECTION 1.3. Incorporation by Reference of Trust Indenture Act..... 6
SECTION 1.4. Rules of Construction................................. 6
ARTICLE II
The Securities............................ 7
SECTION 2.1. Form, Dating.......................................... 7
SECTION 2.2. Execution and Authentication.......................... 11
SECTION 2.3. Registrar and Paying Agent............................ 13
SECTION 2.4. Paying Agent To Hold Money in Trust................... 13
SECTION 2.5. Securityholder Lists.................................. 13
SECTION 2.6. Transfer and Exchange................................. 14
SECTION 2.7. Form of Certificate to be Delivered in Connection
with Transfers to Institutional Accredited Investors.. 17
SECTION 2.8. Form of Certificate to be Delivered in Connection
with Transfers Pursuant to Regulation S............... 19
SECTION 2.9. Mutilated, Destroyed, Lost or Stolen Securities....... 20
SECTION 2.10. Outstanding Securities................................ 21
SECTION 2.11. Temporary Securities.................................. 21
SECTION 2.12. Cancellation.......................................... 21
SECTION 2.13. Payment of Interest; Defaulted Interest............... 21
SECTION 2.14. Computation of Interest............................... 23
SECTION 2.15. CUSIP Numbers......................................... 23
ARTICLE III
Covenants............................... 23
SECTION 3.1. Payment of Securities................................. 23
SECTION 3.2. SEC Reports........................................... 23
SECTION 3.3. Limitation on Liens................................... 24
SECTION 3.4. Limitation on Sale and Lease-Backs.................... 25
SECTION 3.5. Waiver of Certain Covenants........................... 25
SECTION 3.6. Maintenance of Office or Agency....................... 25
SECTION 3.7. Money for Security Payments to Be Held in Trust....... 26
SECTION 3.8. Corporate Existence................................... 27
SECTION 3.9. Compliance Certificate................................ 27
- i -
<PAGE> 4
Page
----
ARTICLE IV
Successor Company........................... 28
SECTION 4.1. When Company May Merge or Otherwise Dispose of Assets. 28
ARTICLE V
Defaults and Remedies......................... 28
SECTION 5.1. Events of Default..................................... 28
SECTION 5.2. Acceleration.......................................... 29
SECTION 5.3. Other Remedies........................................ 30
SECTION 5.4. Waiver of Past Defaults............................... 30
SECTION 5.5. Control by Majority................................... 30
SECTION 5.6. Limitation on Suits................................... 31
SECTION 5.7. Rights of Holders to Receive Payment.................. 31
SECTION 5.8. Collection Suit by Trustee............................ 31
SECTION 5.9. Trustee May File Proofs of Claim...................... 31
SECTION 5.10. Priorities............................................ 31
SECTION 5.11. Undertaking for Costs................................. 32
ARTICLE VI
Trustee................................ 32
SECTION 6.1. Duties of Trustee..................................... 32
SECTION 6.2. Rights of Trustee..................................... 33
SECTION 6.3. Individual Rights of Trustee.......................... 34
SECTION 6.4. Trustee's Disclaimer.................................. 34
SECTION 6.5. Notice of Defaults.................................... 34
SECTION 6.6. Reports by Trustee to Holders......................... 35
SECTION 6.7. Compensation and Indemnity............................ 35
SECTION 6.8. Replacement of Trustee................................ 36
SECTION 6.9. Successor Trustee by Merger........................... 37
SECTION 6.10. Eligibility; Disqualification......................... 37
SECTION 6.11. Preferential Collection of Claims Against Company..... 37
SECTION 6.12. Trustee's Application for Instructions from the
Company .............................................. 37
ARTICLE VII
Discharge of Indenture; Defeasance.................. 38
SECTION 7.1. Discharge of Liability on Securities; Defeasance...... 38
SECTION 7.2. Conditions to Defeasance.............................. 39
SECTION 7.3. Application of Trust Money............................ 39
SECTION 7.4. Repayment to Company.................................. 39
SECTION 7.5. Indemnity for U.S. Government Obligations............. 40
SECTION 7.6. Reinstatement......................................... 40
- ii -
<PAGE> 5
Page
----
ARTICLE VIII
Amendments.............................. 40
SECTION 8.1. Without Consent of Holders............................ 40
SECTION 8.2. With Consent of Holders............................... 41
SECTION 8.3. Compliance with Trust Indenture Act................... 42
SECTION 8.4. Revocation and Effect of Consents and Waivers......... 42
SECTION 8.5. Notation on or Exchange of Securities................. 42
SECTION 8.6. Trustee To Sign Amendments............................ 43
ARTICLE IX
Redemption of Notes.......................... 43
SECTION 9.1. Redemption............................................ 43
SECTION 9.2. Applicability of Article.............................. 43
SECTION 9.3. Election to Redeem; Notice to Trustee................. 43
SECTION 9.4. Selection by Trustee of Securities to Be Redeemed..... 43
SECTION 9.5. Notice of Redemption.................................. 44
SECTION 9.6. Deposit of Redemption Price........................... 45
SECTION 9.7. Securities Payable on Redemption Date................. 45
SECTION 9.8. Securities Redeemed in Part........................... 45
ARTICLE X
Miscellaneous............................. 46
SECTION 10.1. Trust Indenture Act Controls......................... 46
SECTION 10.2. Notices.............................................. 46
SECTION 10.3. Communication by Holders with other Holders.......... 46
SECTION 10.4. Certificate and Opinion as to Conditions Precedent... 46
SECTION 10.5. Statements Required in Certificate or Opinion........ 47
SECTION 10.6. When Securities Disregarded.......................... 47
SECTION 10.7. Rules by Trustee, Paying Agent and Registrar......... 47
SECTION 10.8. Legal Holidays....................................... 47
SECTION 10.9. Governing Law........................................ 48
SECTION 10.10. No Recourse Against Others........................... 48
SECTION 10.11. Successors........................................... 48
SECTION 10.12. Multiple Originals................................... 48
SECTION 10.13. Variable Provisions.................................. 48
SECTION 10.14. Qualification of Indenture........................... 48
SECTION 10.15. Table of Contents; Headings.......................... 48
EXHIBIT A Form of the Initial Note
EXHIBIT B Form of the Exchange Note
- iii -
<PAGE> 6
INDENTURE dated as of May 20, 1998, between CBS Corporation, a
Pennsylvania corporation (the "Company"), and Citibank, N.A., a national banking
association (the "Trustee").
Each party agrees as follows for the benefit of the other parties
and for the equal and ratable benefit of the Holders of the Company's 7.15%
Senior Notes due 2005 (the "Initial Notes") and, if and when issued in exchange
for Initial Notes as provided in the Registration Rights Agreement (as
hereinafter defined), the Company's 7.15% Senior Notes due 2005 (the "Exchange
Notes" and, together with the Initial Notes, the "Securities" or the "Notes"):
ARTICLE I
Definitions and Incorporation by Reference
SECTION 1.1. Definitions.
"Attributable Debt" means, as to any particular lease, the total net
amount of rent (discounted from the due dates thereof at the weighted average
Yield to Maturity of the Notes outstanding under this Indenture, such average
being weighted by the principal amount of the Notes) required to be paid by the
lessee during the remaining term thereof, excluding amounts required to be paid
on account of maintenance and repairs, insurance, taxes, assessments, water
rates and similar charges. In the case of any lease which is terminable by the
lessee upon the payment of a penalty, such rent will also include the amount of
such penalty, but no rent will be considered as required to be paid under such
lease subsequent to the first date upon which it may be so terminated. In the
case of any lease under which the amount of rent is indeterminable (e.g., where
rent is based on sales or profits), the net amount of rent required to be paid
will be the amount of rent paid during the preceding fiscal year.
"Board of Directors" means the Board of Directors of the Company or
any committee thereof duly authorized to act on behalf of such Board of
Directors with respect to the relevant matter.
"Business Day" means a day other than a Saturday, Sunday or other
day on which commercial banking institutions are authorized or required by law
to close in New York City.
"Code" means the Internal Revenue Code of 1986, as amended.
"Company" means CBS Corporation until a successor replaces it and,
thereafter, means such successor.
"Consolidated Adjusted Book Capitalization" means, as to any Person,
the Consolidated Total Debt of such Person plus its shareholders' equity and any
Preferred Stock or other capital stock classified under GAAP as being subject to
redemption and not included in its shareholders' equity, plus minority interests
in its Subsidiaries.
<PAGE> 7
2
"Consolidated Total Debt" means as to any Person, the total Debt of
such Person and its Subsidiaries computed and consolidated in accordance with
GAAP .
"Debt" means (i) all obligations represented by notes, bonds,
debentures or similar evidences of indebtedness; (ii) all indebtedness for
borrowed money or for the deferred purchase price of property or services other
than, in the case of any deferred purchase price, on normal trade terms; and
(iii) all rental obligations as lessee under leases which shall have been or
should be, in accordance with GAAP, recorded as capital leases.
"Default" means any event or condition that is, or after notice or
passage of time or both would be, an Event of Default.
"Depositary" means The Depository Trust Company, its nominees and
their respective successors and assigns, or such other depository institution
hereinafter appointed by the Company.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchange Offer" shall have the meaning set forth in the
Registration Rights Agreement.
"Funded Debt" means all indebtedness for borrowed money having a
maturity of more than 12 months from the date as of which the amount thereof is
to be determined or having a maturity of less than 12 months but by its terms
being renewable or extendable beyond 12 months from such date at the option of
the borrower.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect on the Issue Date, including those set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession. All ratios and computations based on GAAP contained in
this Indenture shall be computed in conformity with GAAP.
"Holder" or "Securityholder" means the Person in whose name a
Security is registered in the Note Register.
"Indenture" means this Indenture as amended or supplemented from
time to time.
"Issue Date" means the date on which the Initial Notes are
originally issued.
"Legal Holiday" has the meaning ascribed to it in Section 10.8.
"Mortgage" means any mortgage, pledge, lien, encumbrance, charge or
security interest of any kind.
<PAGE> 8
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"Note Register" means the register of Securities, maintained by the
Trustee, pursuant to Section 2.3.
"Offering Memorandum" means the Offering Memorandum dated May 15,
1998 relating to the Initial Notes; provided that after the issuance of Exchange
Notes, all references herein to "Offering Memorandum" with respect to the
Exchange Notes shall be deemed references to the prospectus relating to the
Exchange Notes.
"Officer" means any of the Chairman of the Board, the Chief
Executive Officer, the President, the Chief Operating Officer, any Vice
President, the Treasurer, the Secretary or the Controller of the Company.
"Officers' Certificate" means a certificate signed by two or more
Officers.
"Opinion of Counsel" means a written opinion from legal counsel who
is acceptable to the Trustee. The counsel may be an employee of or counsel to
the Company or the Trustee.
"Person" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Preferred Stock" means as to any Person, capital stock of such
Person that has a preference as to dividends or upon liquidation over the common
stock of such Person.
"Private Exchange Securities" shall have the meaning set forth in
the Registration Rights Agreement.
"QIB" means any "qualified institutional buyer" (as defined in Rule
144A under the Securities Act).
"Redemption Date" means the date fixed for the redemption of any
Security by or pursuant to this Indenture.
"Redemption Price" means the price at which any Security is to be
redeemed pursuant to this Indenture.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated May 20, 1998, among the Company, Merrill Lynch, Pierce, Fenner
& Smith Incorporated, Chase Securities Inc., and J.P. Morgan Securities Inc.
"Restricted Period" means the 40 consecutive days beginning on and
including the later of (A) the day on which the Initial Notes are offered to
persons other than distributors (as defined in Regulation S under the Securities
Act) and (B) the Issue Date.
<PAGE> 9
4
"Restricted Property" means all land, buildings, machinery and
equipment and leasehold interests and improvements which would be reflected on a
consolidated balance sheet of the Company and its consolidated Subsidiaries
prepared in accordance with GAAP, excluding (i) all such property located
outside the United States; (ii) all rights, contracts and other intangible
assets of any nature whatsoever; (iii) all inventories, other current assets and
films, programs and film and program rights; and (iv) the real property
comprising the Company's headquarters building on West 52nd Street, New York,
New York, and the real property comprising the studio facilities in Studio City,
California, owned by Radford Studio Center Inc.
"Restricted Securities Legend" means the Private Placement Legend
set forth in clause (A) of Section 2.1(c).
"Restricted Subsidiary" means any Subsidiary other than (i) a
Subsidiary substantially all the tangible properties of which are located, or
substantially all the operations of which are located or conducted, outside the
United States; (ii) a Subsidiary the principal business of which consists of one
or more of the following: (A) investing in, developing or otherwise dealing in
or with real estate or providing services directly related thereto, (B)
financing, including without limitation, lending on the security of, purchasing
or discounting (with or without recourse), receivables, leases, obligations or
other claims arising from or in connection with the purchase or sale of products
or services or (C) leasing any form of property; or (iii) a Subsidiary the
consolidated assets of which do not include Restricted Property.
"SEC" means the Securities and Exchange Commission.
"Securities" or "Notes" means the Securities issued under this
Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Custodian" means the custodian with respect to the
Global Securities (as appointed by the Depositary), or any successor Person
thereto and shall initially be the Trustee.
"Subsidiary" of any specified corporation means any corporation at
least a majority of whose outstanding voting stock shall at the time be owned,
directly or indirectly, by the specified corporation or by one or more of its
Subsidiaries, or both.
"Successor Company" shall have the meaning assigned thereto in
clause (i) of Section 4.1.
"TIA" or "Trust Indenture Act" means the Trust Indenture Act of 1939
(15 U.S.C. ss.ss. 77aaa-77bbbb), as amended, as in effect on the date hereof
(except as provided in Section ss. 8.3) until such time as this Indenture is
qualified under the TIA, and thereafter, as in effect on the date on which this
Indenture is qualified under the TIA (except as provided in Section ss. 8.3).
<PAGE> 10
5
"Trustee" means the party named as such in this Indenture until a
successor replaces it and, thereafter, means such successor.
"Trust Officer" means any officer or assistant officer of the
Trustee assigned by the Trustee to administer its corporate trust matters.
"Uniform Commercial Code" means the New York Uniform Commercial Code
as in effect from time to time.
"U.S. Government Obligations" means direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States of America (including any agency or instrumentality thereof) for
the payment of which the full faith and credit of the United States of America
is pledged and which are not callable or redeemable at the issuer's option.
"Yield to Maturity" means the yield to maturity on the Notes,
calculated at the time of issuance of the Notes, or if applicable, at the most
recent redetermination of interest on the Notes, in accordance with accepted
financial practice.
SECTION 1.2. Other Definitions.
Defined in
Term Section
---- ----------
"Agent Members"........................................... 2.1(d)
"Authenticating Agent".................................... 2.2
"Company Order"........................................... 2.2
"Corporate Trust Office".................................. 3.6
"covenant defeasance option".............................. 7.1(b)
"Defaulted Interest"...................................... 2.13
"Definitive Securities"................................... 2.1(e)
"Event of Default"........................................ 5.1
"Exchange Global Note".................................... 2.1(a)
"Exchange Notes".......................................... Preamble
"Global Securities"....................................... 2.1(a)
"Initial Notes" .......................................... Preamble
"Institutional Accredited Investor Global Note"........... 2.1(a)
"Institutional Accredited Investor Note".................. 2.1(a)
"legal defeasance option"................................. 7.1(b)
"Paying Agent"............................................ 2.3
"Private Placement Legend"................................ 2.1(c)
"Purchase Agreement....................................... 2.1(a)
"Registrar"............................................... 2.3
"Regulation S"............................................ 2.1(a)
"Regulation S Global Note"................................ 2.1(a)
"Regulation S Note"....................................... 2.1(a)
<PAGE> 11
6
"Resale Restriction Termination Date"..................... 2.6
"Rule 144A"............................................... 2.1(a)
"Rule 144A Notes"......................................... 2.1(a)
"Rule 144A Global Note"................................... 2.1(a)
"Special Interest Payment Date"........................... 2.13(a)
"Special Record Date"..................................... 2.13(a)
SECTION 1.3. Incorporation by Reference of Trust Indenture Act. This
Indenture is subject to the mandatory provisions of the TIA which are
incorporated by reference in and made a part of this Indenture. The following
TIA terms have the following meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company and any
other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by the TIA reference to another statute or defined by SEC rule have
the meanings assigned to them by such definitions.
SECTION 1.4. Rules of Construction. Unless the context otherwise
requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) "including" means including without limitation;
(5) words in the singular include the plural and words in the plural
include the singular; and
(6) the principal amount of any noninterest bearing or other
discount security at any date shall be the principal amount thereof that
would be shown on a balance sheet of the issuer dated such date prepared
in accordance with GAAP.
<PAGE> 12
7
ARTICLE II
The Securities
SECTION 2.1. Form, Dating and Terms. (a) The Initial Notes are being
offered and sold by the Company pursuant to a Purchase Agreement, dated May 15,
1998, among the Company and Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Chase Securities Inc., and J.P. Morgan Securities Inc. (the "Purchase
Agreement").
Initial Notes offered and sold to qualified institutional buyers (as
defined in Rule 144A under the Securities Act ("Rule 144A")) in the United
States of America (the "Rule 144A Notes") will be issued on the Issue Date in
the form of a single, permanent global Security in definitive, fully registered
book-entry form substantially in the form of Exhibit A, which is hereby
incorporated by reference and expressly made a part of this Indenture (the "Rule
144A Global Note"), registered in the name of a nominee of the Depositary,
deposited on behalf of the purchasers of the Notes represented thereby with the
Trustee, as custodian for the Depositary, duly executed by the Company and
authenticated by the Trustee as hereinafter provided. The Rule 144A Global Note
may be represented by more than one certificate, if so required by the
Depositary's rules regarding the maximum principal amount to be represented by a
single certificate. The aggregate principal amount of the Rule 144A Global Note
may from time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for the Depositary or its nominee, as
hereinafter provided.
Initial Notes offered and sold outside the United States of America
(the "Regulation S Note") in reliance on Regulation S under the Securities Act
("Regulation S") shall be issued in the form of a single, permanent global
Security in definitive, fully registered book-entry form substantially in the
form of Exhibit A (the "Regulation S Global Note") registered in the name of
Cede & Co., as nominee of the Depositary, deposited on behalf of the purchasers
of the Notes represented thereby with the Trustee, as custodian for the
Depositary, for credit to the respective accounts of the purchasers (or to such
other accounts as they may direct) at Morgan Guaranty Trust Company of New York,
Brussels office, as operator of the Euroclear System, or Cedel Bank, societe
anonyme, duly executed by the Company and authenticated by the Trustee as
hereinafter provided. The Regulation S Global Note may be represented by more
than one certificate, if so required by the Depositary's rules regarding the
maximum principal amount to be represented by a single certificate. The
aggregate principal amount of the Regulation S Global Note may from time to time
be increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary or its nominee, as hereinafter provided.
Initial Notes resold to institutional "accredited investors" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act) in the
United States of America (the "Institutional Accredited Investor Note") will be
issued in the form of a single, permanent global Security in definitive, fully
registered book-entry form substantially in the form of
<PAGE> 13
8
Exhibit A (the "Institutional Accredited Investor Global Note") registered in
the name of a nominee of the Depositary deposited on behalf of the purchasers of
the Notes represented thereby with the Trustee, as custodian for the Depositary,
duly executed by the Company and authenticated by the Trustee as hereinafter
provided. The Institutional Accredited Investor Global Note may be represented
by more than one certificate, if so required by the Depositary's rules regarding
the maximum principal amount to be represented by a single certificate. The
aggregate principal amount of the Institutional Accredited Investor Global Note
may from time to time be increased or decreased by adjustments made on the
records of the Trustee, as custodian for the Depositary or its nominee, as
hereinafter provided.
Exchange Notes exchanged for interests in the Rule 144A Note, the
Regulation S Note and the Institutional Accredited Investor Note will be issued
in the form of a permanent global Note substantially in the form set forth in
Exhibit B hereto, which is hereby incorporated by reference and expressly made a
part of this Indenture, deposited with the Trustee as hereinafter provided, with
the applicable legend set forth in Section 2.1(c) hereof (the "Exchange Global
Note"). The Exchange Global Note may be represented by more than one
certificate, if so required by the Depositary's rules regarding the maximum
principal amount to be represented by a single certificate.
The Rule 144A Global Note, the Regulation S Global Note, the
Exchange Global Note and the Institutional Accredited Investor Global Note are
sometimes collectively herein referred to as the "Global Securities."
The principal of (premium, if any) and interest on the Securities
shall be payable at the office or agency of the Company maintained for such
purpose in The City of New York, or at such other office or agency of the
Company as may be maintained for such purpose pursuant to Section 2.3; provided,
however, that, at the option of the Company, each installment of interest may be
paid by check mailed to addresses of the Persons entitled thereto as such
addresses shall appear on the Note Register.
The Private Exchange Securities shall be in the form of Exhibit A.
The Securities may have notations, legends or endorsements required by law,
stock exchange rule or usage, in addition to those set forth on Exhibits A and
B. The Company and the Trustee shall approve the forms of the Securities and any
notation, endorsement or legend on them. Each Security shall be dated the date
of its authentication. The terms of the Securities set forth in Exhibit A and
Exhibit B are part of the terms of this Indenture and, to the extent applicable,
the Company and the Trustee, by their execution and delivery of this Indenture,
expressly agree to be bound by such terms.
(b) Denominations. The Securities shall be issuable only in fully
registered form, without coupons, and only in denominations of $1,000 and any
integral multiple thereof.
(c) Restrictive Legends. Unless and until (i) an Initial Note is
sold under an effective registration statement or (ii) an Initial Note is
exchanged for an Exchange Note in connection with an effective registration
statement, in each case pursuant to the Registration
<PAGE> 14
9
Rights Agreement, (A) such Initial Note shall bear the following legend (the
"Private Placement Legend") on the face thereof:
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR
OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS
SECURITY IN AN "OFFSHORE TRANSACTION" PURSUANT TO RULE 904 OF REGULATION
S, (2) AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE WHICH IS TWO YEARS
(OR SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(k) UNDER THE
SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF
THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS SECURITY) OR
THE LAST DAY ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE
OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) AND (Y) SUCH
LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAWS (THE "RESALE
RESTRICTION TERMINATION DATE"), OFFER, SELL OR OTHERWISE TRANSFER THIS
SECURITY EXCEPT (A) TO THE COMPANY, (B) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C)
FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE
144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
BUYER," AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT, THAT PURCHASES
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER
TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT
WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY, THE
TRUSTEE, THE TRANSFER AGENT AND THE REGISTRAR SHALL HAVE THE RIGHT PRIOR
TO ANY SUCH OFFER, SALE OR TRANSFER (I) PURSUANT TO CLAUSE (D) OR (E) TO
REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER
INFORMATION SATISFACTORY TO EACH OF THEM, AND (II) IN EACH OF
<PAGE> 15
10
THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATION OF TRANSFER IN THE
FORM APPEARING ON THE OTHER SIDE OF THIS SECURITY IS COMPLETED AND
DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED
UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION
DATE. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED STATES"
AND "U.S. PERSON" HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE
SECURITIES ACT.
(B) The Global Securities, whether or not an Initial Note, shall
bear the following legend on the face thereof:
"UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK,
NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME
OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO.,
HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY
SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET
FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF."
(d) Book-Entry Provisions. (i) This Section 2.1(d) shall apply only
to Global Securities deposited with the Trustee, as custodian for the
Depositary.
(ii) Each Global Security initially shall (x) be registered in the
name of the Depositary for such Global Security or the nominee of such
Depositary, (y) be delivered to the Trustee as custodian for such Depositary and
(z) bear legends as set forth in Section 2.1(c).
(iii) Members of, or participants in, the Depositary ("Agent
Members") shall have no rights under this Indenture with respect to any Global
Security held on their behalf by the Depositary or by the Trustee as the
custodian of the Depositary or under such Global Security, and the Depositary
may be treated by the Company, the Trustee and any agent of the Company or the
Trustee as the absolute owner of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the
<PAGE> 16
11
Trustee or any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the Depositary
or impair, as between the Depositary and its Agent Members, the operation of
customary practices of the Depositary governing the exercise of the rights of a
holder of a beneficial interest in any Global Security.
(iv) In connection with any transfer of a portion of the beneficial
interest in a Global Security pursuant to subsection (e) of this Section to
beneficial owners who are required to hold Definitive Securities (as defined
below), the Security Trustee shall reflect on its books and records the date and
a decrease in the principal amount of such Global Security in an amount equal to
the principal amount of the beneficial interest in the Global Security to be
transferred, and the Company shall execute, and the Trustee shall authenticate
and deliver, one or more Definitive Securities of like tenor and amount.
(v) In connection with the transfer of an entire Global Security to
beneficial owners pursuant to subsection (e) of this Section, such Global
Security shall be deemed to be surrendered to the Trustee for cancellation, and
the Company shall execute, and the Trustee shall authenticate and deliver, to
each beneficial owner identified by the Depositary in exchange for its
beneficial interest in such Global Security, an equal aggregate principal amount
of Definitive Securities of authorized denominations.
(e) Definitive Securities. Except as provided below, owners of
beneficial interests in Global Securities will not be entitled to receive
certificated Securities ("Definitive Securities"). If required to do so pursuant
to any applicable law or regulation, beneficial owners may obtain Definitive
Securities in exchange for their beneficial interests in a Global Security upon
written request in accordance with the Depositary's and the Registrar's
procedures. In addition, Definitive Securities shall be transferred to all
beneficial owners in exchange for their beneficial interests in a Global
Security if (i) the Depositary notifies the Company that it is unwilling or
unable to continue as Depositary for such Global Security or the Depositary
ceases to be a "Clearing Agency" registered under the Exchange Act, at a time
when the Depositary is required to be so registered in order to act as
Depositary, and in each case a successor depositary is not appointed by the
Company within 40 days of such notice or (ii) an Event of Default has occurred
and is continuing and the Registrar has received a request from the Depositary.
(f) Any Definitive Security delivered in exchange for an interest in
a Global Security pursuant to Section 2.1(d)(iv) and (v) shall, except as
otherwise provided by paragraph (c) of Section 2.6, bear the applicable legend
regarding transfer restrictions applicable to the Definitive Security set forth
in Section 2.1(c).
(g) The registered holder of a Global Security may grant proxies and
otherwise authorize any person, including Agent Members and persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Securities.
SECTION 2.2. Execution and Authentication. Two Officers shall sign
the Securities for the Company by manual or facsimile signature. If an Officer
whose signature
<PAGE> 17
12
is on a Security no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid nevertheless.
A Security shall not be valid until an authorized signatory of the
Trustee manually authenticates the Security. The signature of the Trustee on a
Security shall be conclusive evidence that such Security has been duly and
validly authenticated and issued under this Indenture.
At any time and from time to time after the execution and delivery
of this Indenture, the Trustee shall authenticate and make available for
delivery: (1) Initial Notes for original issue in an aggregate principal amount
of $500.0 million and (2) Exchange Notes for issue only in an Exchange Offer
pursuant to the Registration Rights Agreement, and only in exchange for Initial
Notes of an equal principal amount, in each case upon a written order of the
Company signed by two Officers or by an Officer and either an Assistant
Treasurer or an Assistant Secretary of the Company (the "Company Order"). Such
Company Order shall specify the amount of the Securities to be authenticated and
the date on which the original issue of Securities is to be authenticated and
whether the Securities are to be Initial Notes or Exchange Notes. The aggregate
principal amount of Securities outstanding at any time may not exceed $500.0
million except as provided in Section 2.9.
The Trustee may appoint an agent (the "Authenticating Agent")
reasonably acceptable to the Company to authenticate the Securities. Unless
limited by the terms of such appointment, any such Authenticating Agent may
authenticate Securities whenever the Trustee may do so. Each reference in this
Indenture to authentication by the Trustee includes authentication by such
agent.
In case the Company, pursuant to Article IV, shall be consolidated
or merged with or into any other Person or shall convey, transfer, lease or
otherwise dispose of its properties and assets substantially as an entirety to
any Person, and the successor Person resulting from such consolidation, or
surviving such merger, or into which the Company shall have been merged, or the
Person which shall have received a conveyance, transfer, lease or other
disposition as aforesaid, shall have executed an indenture supplemental hereto
with the Trustee pursuant to Article IV, any of the Securities authenticated or
delivered prior to such consolidation, merger, conveyance, transfer, lease or
other disposition may, from time to time, at the request of the successor
Person, be exchanged for other Securities executed in the name of the successor
Person with such changes in phraseology and form as may be appropriate, but
otherwise in substance of like tenor as the Securities surrendered for such
exchange and of like principal amount; and the Trustee, upon Company Order of
the successor Person, shall authenticate and deliver Securities as specified in
such order for the purpose of such exchange. If Securities shall at any time be
authenticated and delivered in any new name of a successor Person pursuant to
this Section 2.2 in exchange or substitution for or upon registration of
transfer of any Securities, such successor Person, at the option of the Holders
but without expense to them, shall provide for the exchange of all Securities at
the time outstanding for Securities authenticated and delivered in such new
name.
<PAGE> 18
13
SECTION 2.3. Registrar and Paying Agent. The Company shall maintain
an office or agency where Securities may be presented for registration of
transfer or for exchange (the "Registrar") and an office or agency where
Securities may be presented for payment (the "Paying Agent"). The Company shall
cause each of the Registrar and the Paying Agent to maintain an office or agency
in the Borough of Manhattan, The City of New York. The Registrar shall keep a
register of the Securities and of their transfer and exchange (the "Note
Register"). The Company may have one or more co-registrars and one or more
additional paying agents. The term "Paying Agent" includes any additional paying
agent.
The Company shall enter into an appropriate agency agreement with
any Registrar, Paying Agent or co-registrar not a party to this Indenture, which
shall incorporate the terms of the TIA. The agreement shall implement the
provisions of this Indenture that relate to such agent. The Company shall notify
the Trustee of the name and address of each such agent. If the Company fails to
maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 6.7. The
Company or any of its domestically incorporated Subsidiaries may act as Paying
Agent, Registrar, co-registrar or transfer agent.
The Company initially appoints the Trustee as Registrar and Paying
Agent for the Securities.
SECTION 2.4. Paying Agent To Hold Money in Trust. By at least 10:00
a.m (New York City time) on the date on which any principal of or interest on
any Security is due and payable, the Company shall deposit with the Paying Agent
a sum sufficient to pay such principal or interest when due. The Company shall
require each Paying Agent (other than the Trustee) to agree in writing that such
Paying Agent shall hold in trust for the benefit of Securityholders or the
Trustee all money held by such Paying Agent for the payment of principal of or
interest on the Securities and shall notify the Trustee of any default by the
Company in making any such payment. If the Company or a Subsidiary acts as
Paying Agent, it shall segregate the money held by it as Paying Agent and hold
it as a separate trust fund. The Company at any time may require a Paying Agent
(other than the Trustee) to pay all money held by it to the Trustee and to
account for any funds disbursed by such Paying Agent. Upon complying with this
Section, the Paying Agent (if other than the Company or a Subsidiary) shall have
no further liability for the money delivered to the Trustee. Upon any
bankruptcy, reorganization or similar proceeding with respect to the Company,
the Trustee shall serve as Paying Agent for the Securities.
SECTION 2.5. Securityholder Lists. The Trustee shall preserve in as
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of Securityholders. If the Trustee is not the
Registrar, the Company shall furnish to the Trustee, in writing at least five
Business Days before each interest payment date and at such other times as the
Trustee may request in writing, a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of Securityholders.
<PAGE> 19
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SECTION 2.6. Transfer and Exchange.
(a) The following provisions shall apply with respect to any
proposed transfer of a Rule 144A Note or an Institutional Accredited Investor
Note prior to the date which is two years after the later of the date of
original issue and the last date on which the Company or any affiliate of the
Company was the owner of such Notes (or any predecessor thereto) (the "Resale
Restriction Termination Date"):
(i) a transfer of a Rule 144A Note or an Institutional
Accredited Investor Note or a beneficial interest therein to a QIB shall
be made upon the representation of the transferee that it is purchasing
the Security for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a
"qualified institutional buyer" within the meaning of Rule 144A, and is
aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company
as it has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon
its foregoing representations in order to claim the exemption from
registration provided by Rule 144A;
(ii) a transfer of a Rule 144A Note or an Institutional
Accredited Investor Note or a beneficial interest therein to an
institutional accredited investor shall be made upon receipt by the
Trustee or its agent of a certificate substantially in the form set forth
in Section 2.7 hereof from the proposed transferee and, if requested by
the Company or the Trustee, the delivery of an opinion of counsel,
certification and/or other information satisfactory to each of them; and
(iii) a transfer of a Rule 144A Note or an Institutional
Accredited Investor Note or a beneficial interest therein to a Non-U.S.
Person shall be made upon receipt by the Trustee or its agent of a
certificate substantially in the form set forth in Section 2.7 hereof from
the proposed transferee and, if requested by the Company or the Trustee,
the delivery of an opinion of counsel, certification and/or other
information satisfactory to each of them.
(b) The following provisions shall apply with respect to any
proposed transfer of a Regulation S Note prior to the expiration of the
Restricted Period:
(i) a transfer of a Regulation S Note or a beneficial interest
therein to a QIB shall be made upon the representation of the transferee
that it is purchasing the Security for its own account or an account with
respect to which it exercises sole investment discretion and that it and
any such account is a "qualified institutional buyer" within the meaning
of Rule 144A, and is aware that the sale to it is being made in reliance
on Rule 144A and acknowledges that it has received such information
regarding the Company as the undersigned has requested pursuant to Rule
144A or has determined not to request such information and that it is
aware that the transferor is relying upon its foregoing representations in
order to claim the exemption from registration provided by Rule 144A;
<PAGE> 20
15
(ii) a transfer of a Regulation S Note or a beneficial
interest therein to an institutional accredited investor shall be made
upon receipt by the Trustee or its agent of a certificate substantially in
the form set forth in Section 2.7 hereof from the proposed transferee and,
if requested by the Company or the Trustee, the delivery of an opinion of
counsel, certification and/or other information satisfactory to each of
them; and
(iii) a transfer of a Regulation S Note or a beneficial
interest therein to a Non-U.S. Person shall be made upon receipt by the
Trustee or its agent of a certificate substantially in the form set forth
in Section 2.8 hereof from the proposed transferee and, if requested by
the Company or the Trustee, receipt by the Trustee or its agent of an
opinion of counsel, certification and/or other information satisfactory to
each of them.
After the expiration of the Restricted Period, interests in the
Regulation S Note may be transferred without requiring certification set forth
in Section 2.8 or any additional certification.
(c) Restricted Securities Legend. Upon the transfer, exchange or
replacement of Securities not bearing a Restricted Securities Legend, the
Registrar shall deliver Securities that do not bear a Restricted Securities
Legend. Upon the transfer, exchange or replacement of Securities bearing the
Restricted Securities Legend, the Registrar shall deliver only Securities that
bear such Restricted Securities Legend unless there is delivered to the
Registrar an Opinion of Counsel to the effect that neither such legend nor the
related restrictions on transfer are required in order to maintain compliance
with the provisions of the Securities Act.
(d) The Security Registrar shall retain copies of all letters,
notices and other written communications received pursuant to Section 2.1 or
this Section 2.6. The Company shall have the right to inspect and make copies of
all such letters, notices or other written communications at any reasonable time
upon the giving of reasonable written notice to the Security Registrar.
(e) Obligations with Respect to Transfers and Exchanges of
Securities.
(i) To permit registrations of transfers and exchanges, the
Company shall, subject to the other terms and conditions of this Article
II, execute and the Trustee shall authenticate Definitive Securities and
Global Securities at the Registrar's or co-registrar's request.
(ii) No service charge shall be made to a Holder for any
registration of transfer or exchange, but the Company may require payment
of a sum sufficient to cover any transfer tax, assessments, or similar
governmental charge payable in connection therewith (other than any such
transfer taxes or similar governmental charges payable upon exchange or
transfer pursuant to Section 8.5).
<PAGE> 21
16
(iii) The Registrar or co-registrar shall not be required to
register the transfer of or exchange of any Security for a period
beginning (1) 15 Business Days before the mailing of a notice of an offer
to repurchase Securities and ending at the close of business on the day of
such mailing or (2) 15 Business Days before an interest payment date and
ending on such interest payment date.
(iv) Prior to the due presentation for registration of
transfer of any Security, the Company, the Trustee, the Paying Agent, the
Registrar or any co-registrar may deem and treat the person in whose name
a Security is registered as the absolute owner of such Security for the
purpose of receiving payment of principal of and interest on such Security
and for all other purposes whatsoever, whether or not such Security is
overdue, and none of the Company, the Trustee, the Paying Agent, the
Registrar or any co-registrar shall be affected by notice to the contrary.
(v) All Securities issued upon any transfer or exchange
pursuant to the terms of this Indenture shall evidence the same debt and
shall be entitled to the same benefits under this Indenture as the
Securities surrendered upon such transfer or exchange.
(f) No Obligation of the Trustee. (i) The Trustee shall have no
responsibility or obligation to any beneficial owner of a Global Security, a
member of, or a participant in, the Depositary or other Person with respect to
the accuracy of the records of the Depositary or its nominee or of any
participant or member thereof, with respect to any ownership interest in the
Securities or with respect to the delivery to any participant, member,
beneficial owner or other Person (other than the Depositary) of any notice or
the payment of any amount or delivery of any Securities (or other security or
property) under or with respect to such Securities. All notices and
communications to be given to the Holders and all payments to be made to Holders
in respect of the Securities shall be given or made only to or upon the order of
the registered Holders (which shall be the Depositary or its nominee in the case
of a Global Security). The rights of beneficial owners in any Global Security
shall be exercised only through the Depositary subject to the applicable rules
and procedures of the Depositary. The Trustee may rely and shall be fully
protected in relying upon information furnished by the Depositary with respect
to its members, participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer imposed
under this Indenture or under applicable law with respect to any transfer of any
interest in any Security (including any transfers between or among Depositary
participants, members or beneficial owners in any Global Security) other than to
require delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by, the terms
of this Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
<PAGE> 22
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SECTION 2.7. Form of Certificate to be Delivered in Connection with
Transfers to Institutional Accredited Investors.
[Date]
Citibank, N.A.
111 Wall Street, 5th Floor
New York, New York 10043
Attention: Corporate Trust Department
Dear Sirs:
This certificate is delivered to request a transfer of $
principal amount of the 7.15% Senior Notes due 2005 (the "Notes") of CBS
Corporation (the "Company").
Upon transfer, the Notes would be registered in the name of the new
beneficial owner as follows:
Name: ___________________________________
Address: ________________________________
Taxpayer ID Number: _____________________
The undersigned represents and warrants to you that:
1. We are an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the
"Securities Act")) purchasing for our own account or for the account of such an
institutional "accredited investor" at least $250,000 principal amount of the
Notes, and we are acquiring the Notes not with a view to, or for offer or sale
in connection with, any distribution in violation of the Securities Act. We have
such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risk of our investment in the Notes and we invest
in or purchase securities similar to the Notes in the normal course of our
business. We and any accounts for which we are acting are each able to bear the
economic risk of our or its investment.
2. We understand that the Notes have not been registered under the
Securities Act and, unless so registered, may not be sold except as permitted in
the following sentence. We agree on our own behalf and on behalf of any investor
account for which we are purchasing Notes to offer, sell or otherwise transfer
such Notes prior to the date which is two years after the later of the date of
original issue and the last date on which the Company or any affiliate of the
Company was the owner of such Notes (or any predecessor thereto) (the "Resale
Restriction Termination Date") only (a) to the Company, (b) pursuant to a
registration statement which has been declared effective under the Securities
Act, (c) in a
<PAGE> 23
18
transaction complying with the requirements of Rule 144A under the Securities
Act, to a person we reasonably believe is a qualified institutional buyer under
Rule 144A (a "QIB") that purchases for its own account or for the account of a
QIB and to whom notice is given that the transfer is being made in reliance on
Rule 144A, (d) pursuant to offers and sales that occur outside the United States
within the meaning of Regulation S under the Securities Act, (e) to an
institutional "accredited investor" within the meaning of Rule 501(a)(1), (2),
(3) or (7) under the Securities Act that is purchasing for its own account or
for the account of such an institutional "accredited investor," in each case in
a minimum principal amount of Notes of $250,000 or (f) pursuant to any other
available exemption from the registration requirements of the Securities Act,
subject in each of the foregoing cases to any requirement of law that the
disposition of our property or the property of such investor account or accounts
be at all times within our or their control and in compliance with any
applicable state securities laws. The foregoing restrictions on resale will not
apply subsequent to the Resale Restriction Termination Date. If any resale or
other transfer of the Notes is proposed to be made pursuant to clause (e) above
prior to the Resale Restriction Termination Date, the transferor shall deliver a
letter from the transferee substantially in the form of this letter to the
Company and the Trustee, which shall provide, among other things, that the
transferee is an institutional "accredited investor" (within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act) and that it is acquiring
such Notes for investment purposes and not for distribution in violation of the
Securities Act. Each purchaser acknowledges that the Company and the Trustee
reserve the right prior to any offer, sale or other transfer prior to the Resale
Termination Date of the Notes pursuant to clauses (d), (e) or (f) above to
require the delivery of an opinion of counsel, certifications and/or other
information satisfactory to the Company and the Trustee.
TRANSFEREE:_____________________
BY______________________________
<PAGE> 24
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SECTION 2.8. Form of Certificate to be Delivered in Connection with
Transfers Pursuant to Regulation S.
[Date]
Citibank, N.A.
111 Wall Street, 5th Floor
New York, New York 10043
Attention: Corporate Trust Department
Re: CBS Corporation
7.15% Senior Notes due 2005 (the "Securities")
Ladies and Gentlemen:
In connection with our proposed sale of $________ aggregate
principal amount of the Securities, we confirm that such sale has been effected
pursuant to and in accordance with Regulation S under the United States
Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, we
represent that:
(a) the offer of the Securities was not made to a person in the
United States;
(b) either (i) at the time the buy order was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the United
States or (ii) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction has been
pre-arranged with a buyer in the United States;
(c) no directed selling efforts have been made in the United States
in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable; and
(d) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
In addition, if the sale is made during a restricted period and the
provisions of Rule 903(c)(3) or Rule 904(c)(1) of Regulation S are applicable
thereto, we confirm that such sale has been made in accordance with the
applicable provisions of Rule 903(c)(3) or Rule 904(c)(1), as the case may be.
You and the Company are entitled to rely upon this letter and are
irrevocably authorized to produce this letter or a copy hereof to any interested
party in any administrative
<PAGE> 25
20
or legal proceedings or official inquiry with respect to the matters covered
hereby. Terms used in this certificate have the meanings set forth in Regulation
S.
Very truly yours,
[Name of Transferor]
By:____________________________ ______________________________
Authorized Signature Signature Medallion Guaranteed
SECTION 2.9. Mutilated, Destroyed, Lost or Stolen Securities. If a
mutilated Security is surrendered to the Registrar or if the Holder of a
Security claims that the Security has been lost, destroyed or wrongfully taken,
the Company shall issue and the Trustee shall authenticate a replacement
Security if the requirements of Section 8-405 of the Uniform Commercial Code are
met and the Holder satisfies any other reasonable requirements of the Trustee.
If required by the Trustee or the Company, such Holder shall furnish an
indemnity bond sufficient in the judgment of the Company and the Trustee to
protect the Company, the Trustee, the Paying Agent, the Registrar and any
co-registrar from any loss that any of them may suffer if a Security is
replaced, then, in the absence of notice to the Company or the Trustee that such
Security has been acquired by a bona fide purchaser, the Company shall execute
and upon Company Order the Trustee shall authenticate and deliver, in exchange
for any such mutilated Security or in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and principal amount, bearing a number
not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) in connection
therewith.
Every new Security issued pursuant to this Section in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company and any other obligor upon the
Securities, whether or not the mutilated, destroyed, lost or stolen Security
shall be at any time enforceable by anyone, and shall be entitled to all
benefits of this Indenture equally and proportionately with any and all other
Securities duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
<PAGE> 26
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SECTION 2.10. Outstanding Securities. Securities outstanding at any
time are all Securities authenticated by the Trustee except for those canceled
by it, those delivered to it for cancellation and those described in this
Section as not outstanding. A Security does not cease to be outstanding in the
event the Company holds the Security.
If a Security is replaced pursuant to Section 2.9, it ceases to be
outstanding unless the Trustee and the Company receive proof satisfactory to
them that the replaced Security is held by a bona fide purchaser.
If the Paying Agent segregates and holds in trust, in accordance
with this Indenture, on a maturity date money sufficient to pay all principal
and interest payable on that date with respect to the Securities maturing and
the Paying Agent is not prohibited from paying such money to the Securityholders
on that date pursuant to the terms of this Indenture, then on and after that
date such Securities cease to be outstanding and interest on them ceases to
accrue.
SECTION 2.11. Temporary Securities. Until Definitive Securities are
ready for delivery, the Company may prepare and the Trustee shall authenticate
temporary Securities. Temporary Securities shall be substantially in the form of
Definitive Securities but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the Company
shall prepare and the Trustee shall authenticate Definitive Securities. After
the preparation of Definitive Securities, the temporary Securities shall be
exchangeable for Definitive Securities upon surrender of the temporary
Securities at any office or agency maintained by the Company for that purpose
and such exchange shall be without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities, the Company shall execute,
and the Trustee shall authenticate and make available for delivery in exchange
therefor, one or more Definitive Securities representing an equal principal
amount of Securities. Until so exchanged, the Holder of temporary Securities
shall in all respects be entitled to the same benefits under this Indenture as a
holder of Definitive Securities.
SECTION 2.12. Cancellation. The Company at any time may deliver
Securities to the Trustee for cancellation. The Registrar and the Paying Agent
shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange or payment. The Trustee and no one else shall cancel and
return to the Company all Securities surrendered for registration of transfer,
exchange, payment or cancellation by delivering a certificate of such
destruction to the Company. The Company may not issue new Securities to replace
Securities it has paid or delivered to the Trustee for cancellation.
SECTION 2.13. Payment of Interest; Defaulted Interest. Interest on
any Security which is payable, and is punctually paid or duly provided for, on
any interest payment date shall be paid to the Person in whose name such
Security (or one or more predecessor Securities) is registered at the close of
business on the regular record date for such interest at the office or agency of
the Company maintained for such purpose pursuant to Section 2.3.
<PAGE> 27
22
Any interest on any Security which is payable, but is not paid when
the same becomes due and payable and such nonpayment continues for a period of
30 days shall forthwith cease to be payable to the Holder on the regular record
date by virtue of having been such Holder, and such defaulted interest and (to
the extent lawful) interest on such defaulted interest at the rate borne by the
Securities (such defaulted interest and interest thereon herein collectively
called "Defaulted Interest") shall be paid by the Company, at its election in
each case, as provided in clause (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted Interest
to the Persons in whose names the Securities (or their respective
predecessor Securities) are registered at the close of business on a
Special Record Date (as defined below) for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company shall
notify the Trustee in writing of the amount of Defaulted Interest proposed
to be paid on each Security and the date (not less than 30 days after such
notice) of the proposed payment (the "Special Interest Payment Date"), and
at the same time the Company shall deposit with the Trustee an amount of
money equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money
when deposited to be held in trust for the benefit of the Persons entitled
to such Defaulted Interest as in this clause provided. Thereupon the
Trustee shall fix a record date (the "Special Record Date") for the
payment of such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the Special Interest Payment Date and
not less than 10 days after the receipt by the Trustee of the notice of
the proposed payment. The Trustee shall promptly notify the Company of
such Special Record Date, and in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted
Interest and the Special Record Date and Special Interest Payment Date
therefor to be given in the manner provided for in Section 10.2, not less
than 10 days prior to such Special Record Date. Notice of the proposed
payment of such Defaulted Interest and the Special Record Date and Special
Interest Payment Date therefor having been so given, such Defaulted
Interest shall be paid on the Special Interest Payment Date to the Persons
in whose names the Securities (or their respective Predecessor Securities)
are registered at the close of business on such Special Record Date and
shall no longer be payable pursuant to the following clause (b).
(b) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon such
notice as may be required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to this clause,
such manner of payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, each Security
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Security shall carry the rights to interest accrued
and unpaid, and to accrue, which were carried by such other Security.
<PAGE> 28
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SECTION 2.14. Computation of Interest. Interest on the Securities
shall be computed on the basis of a 360-day year of twelve 30-day months.
SECTION 2.15. CUSIP Numbers. The Company in issuing the Securities
may use "CUSIP" numbers (if then generally in use), and, if so, the Trustee
shall use "CUSIP" numbers in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Securities or as contained
in any notice of a redemption and their reliance may be placed only on the other
identification numbers printed on the Securities, and any such redemption shall
not be affected by any defect in or omission of such numbers. The Company will
promptly notify the Trustee of any change in the "CUSIP" numbers.
ARTICLE III
Covenants
SECTION 3.1. Payment of Securities. The Company shall promptly pay
the principal of and interest on the Securities on the dates and in the manner
provided in the Securities and in this Indenture. Principal and interest shall
be considered paid on the date due if on such date the Trustee or the Paying
Agent holds in accordance with this Indenture money sufficient to pay all
principal and interest then due and the Trustee or the Paying Agent, as the case
may be, is not prohibited from paying such money to the Securityholders on that
date pursuant to the terms of this Indenture.
The Company shall pay interest on overdue principal at the rate
specified therefor in the Securities, and it shall pay interest on overdue
installments of interest at the same rate to the extent lawful.
Notwithstanding anything to the contrary contained in this
Indenture, the Company may, to the extent it is required to do so by law, deduct
or withhold income or other similar taxes imposed by the United States of
America from principal or interest payments hereunder.
SECTION 3.2. SEC Reports. Notwithstanding that the Company may not
remain subject to the reporting requirements of Section 13(a) or 15(d) of the
Exchange Act, the Company will file (if then permitted to do so) with the SEC
and provide (whether or not so filed with the SEC) the Trustee and
Securityholders and prospective Securityholders (upon request) within 15 days of
the date of filing with the SEC or, if not filed, on the date that such reports
would be required to be filed with the SEC if the Company was a reporting
company, with the annual reports and the information, documents and other
reports, which are specified in Sections 13 and 15(d) of the Exchange Act;
provided, however, that the Company shall provide one copy of the exhibits of
the foregoing to the Trustee and shall (upon request) provide additional copies
of such exhibits to any Securityholder or prospective Securityholder. The
Company shall also comply with the other provisions of TIA ss. 314(a).
<PAGE> 29
24
Delivery of such reports, information and documents to the Trustee
is for informational purposes only and the Trustee's receipt of such shall not
constitute notice of any information contained therein or determinable from
information contained therein, including the Company's compliance with any of
its covenants hereunder (as to which the Trustee is entitled to rely exclusively
on Officers' Certificates).
SECTION 3.3. Limitation on Liens. The Company will not itself, and
will not permit any Restricted Subsidiary to, incur, issue, assume or guarantee
any Debt secured by a Mortgage on any Restricted Property, or by any shares of
stock of a Restricted Subsidiary, without effectively providing concurrently
with the incurrence, issuance, assumption or guarantee of such secured Debt that
the Notes (together with, if the Company shall so determine, any other
indebtedness of or guaranteed by the Company or such Restricted Subsidiary then
existing or thereafter created ranking on a parity with the Notes) shall be
secured equally and ratably with (or prior to) such secured Debt, so long as
such Debt shall be so secured, unless, after giving effect thereto, the
aggregate principal amount of all such secured Debt (excluding any Debt secured
by Mortgages permitted by clauses (a) through (h) below), plus all Attributable
Debt of the Company and its Restricted Subsidiaries in respect of sale and
lease-back transactions (as defined in Section 3.4) involving Restricted
Property, but excluding any Attributable Debt in respect of any such sale and
lease-back transaction the proceeds of which have been applied in the manner set
forth in clause (b) under Section 3.4 would not exceed 10% of the Consolidated
Adjusted Book Capitalization as determined on the basis of the most recent
quarterly consolidated balance sheet of the Company; provided, however, that
such restrictions shall not apply to (a) Mortgages existing on the date of this
Indenture; (b) Mortgages on property of, or on any shares of stock or
indebtedness of, any corporation existing at the time such corporation becomes a
Subsidiary; (c) Mortgages on property of, or on any shares of stock or
indebtedness of any corporation existing at the time such corporation is merged
with or consolidated with the Company or a Restricted Subsidiary or at the time
of a sale, lease or other disposition of the properties of a corporation as an
entirety or substantially as an entirety to the Company or a Restricted
Subsidiary; (d) Mortgages on property existing at the time of the acquisition
thereof or to secure the payment of all or any part of the purchase price or
construction cost thereof or to secure any indebtedness incurred prior to, at
the time or within six months after, the acquisition or completion of such
property for the purpose of financing all or any part of the purchase price or
construction cost thereof; (e) Mortgages to secure all or part of the cost of
repairing, altering, constructing, improving or developing such property as is,
in the opinion of the Board of Directors of the Company, substantially
unimproved or to secure indebtedness incurred for the purpose of financing any
such cost; (f) Mortgages in favor of the Company or any Restricted Subsidiary;
(g) Mortgages on capital stock issued by, or partnership or other similar
interests in, any Subsidiary provided that the Debt secured by such Mortgage is
also secured by Mortgages which if incurred by the Company or a Restricted
Subsidiary would be covered by clause (d) or (e) of this paragraph on property
of such Subsidiary constituting at least 80% of the book value of its tangible
assets; or (h) any extension, renewal or replacement (or successive extensions,
renewals or replacements) as a whole or in part, of any Mortgage referred to in
the foregoing clauses (a) through (g) inclusive; provided that such extension,
renewal or replacement Mortgage shall be limited to all or part of the same
<PAGE> 30
25
property that secured the Mortgage extended, renewed or replaced (plus
improvements on such property).
The Mortgage of any Restricted Property of the Company or a
Restricted Subsidiary in favor of the United States of America or any
department, agency or instrumentality thereof to secure partial, progress,
advance or other payments by the Company or any Subsidiary pursuant to the
provisions of any contract or statute shall not be deemed to create indebtedness
secured by a Mortgage within the meaning of the preceding paragraph.
SECTION 3.4. Limitation on Sale and Lease-Backs. The Company will
not itself, and will not permit any Restricted Subsidiary to, enter into any
arrangements with any bank, insurance company or other lender or investor (not
including the Company or any Restricted Subsidiary), or to which any such lender
or investor is a party providing for the leasing by the Company or such
Restricted Subsidiary for a period, including renewals, in excess of three years
of any Restricted Property which has been owned for more than six months by the
Company or such Restricted Subsidiary and which has been or is to be sold or
transferred by the Company or such Restricted Subsidiary to such lender or
investor or to any person to whom funds have been or are to be advanced by such
lender or investor on the security of such Restricted Property (a "sale and
lease-back transaction") unless either (a) the Company or such Restricted
Subsidiary could, under the restrictions described in Section 3.3, create Debt
secured by a Mortgage on the Restricted Property to be leased in an amount equal
to the Attributable Debt with respect to such sale and lease-back transaction
without equally and ratably securing the Notes; or (b) the Company, within six
months after the sale or transfer shall have been made, applies an amount equal
to the greater of (i) the net proceeds of the sale of the Restricted Property
leased pursuant to such arrangement or (ii) the fair market value of the
Restricted Property so leased at the time of entering into such arrangement (as
determined by the Board of Directors of the Company) to the retirement of Funded
Debt of the Company ranking on a parity with the Notes (except that no
retirement referred to in this clause (b) may be effected by payment at maturity
or pursuant to any mandatory sinking fund or prepayment provision).
SECTION 3.5. Waiver of Certain Covenants. The Company may omit, in
any particular instance, to comply with any covenant or condition set forth in
Sections 3.3 and 3.4, if before or after the time for such compliance the
Holders of at least a majority in principal amount of the Securities at the time
outstanding shall, by notice to the Trustee, either waive such compliance in
such instance or generally waive compliance with such covenant or condition, but
no such waiver shall extend to or affect such covenant or condition except to
the extent so expressly waived, and, until such waiver shall become effective,
the obligations of the Company and the duties of the Trustee in respect of any
such covenant or condition shall remain in full force and effect.
SECTION 3.6. Maintenance of Office or Agency. The Company will
maintain in The City of New York, an office or agency where the Securities may
be presented or surrendered for payment, where, if applicable, the Securities
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Company in respect of the Notes and this Indenture
may be served. The corporate trust office
<PAGE> 31
26
of the Trustee, which initially shall be located at Citibank, N.A., 111 Wall
Street, 5th Floor, New York, New York 10043, Attention: Corporate Trust
Department (the "Corporate Trust Office") shall be such office or agency of the
Company, unless the Company shall designate and maintain some other office or
agency for one or more of such purposes. The Company will give prompt written
notice to the Trustee of any change in the location of any such office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
The Company may also from time to time designate one or more other
offices or agencies (in or outside of The City of New York) where the Securities
may be presented or surrendered for any or all such purposes and may from time
to time rescind any such designation; provided, however, that no such
designation or rescission shall in any manner relieve the Company of its
obligation to maintain an office or agency in The City of New York for such
purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and any change in the location of any such other
office or agency.
SECTION 3.7. Money for Security Payments to Be Held in Trust. If the
Company shall at any time act as its own Paying Agent, it will, on or before
each due date of the principal of (or premium, if any) or interest on any of the
Securities, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal of (premium, if any) or interest
so becoming due until such sums shall be paid to such Persons or otherwise
disposed of as herein provided and will promptly notify the Trustee in writing
of its action or failure to so act.
Whenever the Company shall have one or more Paying Agents for the
Securities, it will, on or before each due date of the principal of (or premium,
if any) or interest on any Securities, deposit with any Paying Agent a sum in
same day funds (or New York Clearing House funds if such deposit is made prior
to the date on which such deposit is required to be made) that shall be
available to the Trustee by 10:00 a.m. New York City time on such due date
sufficient to pay the principal (and premium, if any) or interest so becoming
due, such sum to be held in trust for the benefit of the Persons entitled to
such principal, premium or interest, and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee in writing of such action
or any failure to so act.
The Company will cause each Paying Agent (other than the Trustee) to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section, that
such Paying Agent will:
(a) hold all sums held by it for the payment of the principal of
(and premium, if any) or interest on Securities in trust for the benefit
of the Persons entitled thereto until such sums shall be paid to such
Persons or otherwise disposed of as herein provided;
<PAGE> 32
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(b) give the Trustee written notice of any default by the Company
(or any other obligor upon the Securities) in the making of any payment of
principal (and premium, if any) or interest; and
(c) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such sums.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the payment of the principal of (or premium,
if any) or interest on any Security and remaining unclaimed for two years after
such principal, premium or interest has become due and payable shall be paid to
the Company on Company Order, or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Note shall thereafter, as an
unsecured general creditor, look only to the Company for payment thereof, and
all liability of the Trustee or such Paying Agent with respect to such trust
money, and all liability of the Company as trustee thereof, shall thereupon
cease; provided, however, that the Trustee or such Paying Agent, before being
required to make any such repayment to the Company, may at the expense of the
Company mail to the Holders of the Securities as to which the money to be repaid
was held in trust, as their names and addresses appear in the Security Register,
a notice that such moneys remain unclaimed and that, after a date specified in
the notice, which shall not be less than 30 days from the date on which the
notice was first mailed to the Holders of the Securities as to which the money
to be repaid was held in trust, any unclaimed balance of such moneys than
remaining will be paid to the Company free of the trust formerly impressed upon
it.
SECTION 3.8. Corporate Existence. Subject to Article IV, the Company
will do or cause to be done all things necessary to preserve and keep in full
force and effect its corporate existence.
SECTION 3.9. Compliance Certificate. The Company shall deliver to
the Trustee within 120 days after the end of each fiscal year of the Company an
Officers' Certificate stating that in the course of the performance by the
signers of their duties as Officers of the Company they would normally have
knowledge of any Default or Event of Default and whether or not the signers know
of any Default or Event of Default that occurred during such period. If they do,
the certificate shall describe the Default or Event of Default, its status and
what action the Company is taking or proposes to take with respect thereto. The
Company also shall comply with TIA ss. 314(a)(4).
<PAGE> 33
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ARTICLE IV
Successor Company
SECTION 4.1. When Company May Merge or Otherwise Dispose of Assets.
The Company will not, in a single transaction or series of related transactions,
consolidate with or merge with or into, or convey, transfer, lease or otherwise
dispose of all or substantially all its assets to, any Person nor permit any
Person to merge with or into the Company, unless:
(i) the resulting, surviving or transferee Person (the
"Successor Company") will be a Person organized and existing under the
laws of the United States of America, any State thereof or the District of
Columbia and the Successor Company (if not the Company) will expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, all the obligations of the
Company under the Securities and this Indenture;
(ii) immediately before and after giving effect to such
transaction, no Default or Event of Default will have occurred and be
continuing; and
(iii) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance or transfer and such supplemental
indenture (if any) comply with this Indenture.
The Successor Company shall succeed to, and be substituted for, and
may exercise every right and power of, the Company under this Indenture, with
the same effect as if it had been named in this Indenture as the Company. In the
event of any such conveyance or transfer as described in this Section 4.1, the
Company as the predecessor may be dissolved, wound up or liquidated at any time
thereafter.
ARTICLE V
Defaults and Remedies
SECTION 5.1. Events of Default. An "Event of Default" occurs if:
(1) the Company defaults in any payment of interest on any Security
when the same becomes due and payable, and such default continues for a
period of 30 days;
(2) the Company defaults in the payment of the principal of or
premium, if any, on any Security when the same becomes due and payable at
its maturity;
(3) the Company defaults in the performance of or a breach by the
Company of any other covenant or agreement in this Indenture or under the
Securities (other
<PAGE> 34
29
than those referred to in (1) or (2) above) and such default continues for
90 days after the notice specified below;
(4) the entry of an order for relief against the Company under the
Federal Bankruptcy Act by a court having jurisdiction in the premises or a
decree or order by a court having jurisdiction in the premises adjudging
the Company a bankrupt or insolvent under any other applicable Federal or
state law, or the entry of a decree or order approving as properly filed a
petition seeking reorganization, arrangement, adjustment or composition of
or in respect of the Company under the Federal Bankruptcy Code or any
other applicable Federal or state law, or appointing a receiver,
liquidator, assignee, trustee, sequestrator (or similar official) of the
Company or of any substantial part of its property, or ordering the
winding up or liquidation of its affairs, and the continuance of any such
decree or order unstayed and in effect for a period of 90 consecutive
days;
(5) the consent by the Company to the institution of bankruptcy or
insolvency proceedings against it, or the filing by it of a petition or
answer or consent seeking reorganization or relief under the Federal
Bankruptcy Code or any other applicable Federal or state law, or the
consent by it to the filing of any such petition or to the appointment of
a receive liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company or of any substantial part of its property, or
the making by it of an assignment for the benefit of creditors, or the
admission by it in writing of its inability to pay its debts generally as
they become due, or the taking of corporate action by the Company in
furtherance of any such action;
The foregoing will constitute Events of Default whatever the reason
for any such Event of Default and whether it is voluntary or involuntary or is
effected by operation of law or pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body.
Notwithstanding the foregoing, a Default under clause (1), (2) or
(3) of this Section 5.1 will not constitute an Event of Default until the
Trustee or the Holders of at least 25% in principal amount of the outstanding
Securities notify the Company of the Default and the Company does not cure such
Default within the time specified in said clause (1), (2) or (3) after receipt
of such notice. Such notice must specify the Default, demand that it be remedied
and state that such notice is a "Notice of Default".
The Company shall deliver to the Trustee, within 30 days after the
occurrence thereof, written notice in the form of an Officers' Certificate of
any Event of Default under clause (3) of this Section 5.1.
SECTION 5.2. Acceleration. If an Event of Default (other than an
Event of Default specified in Section 5.1(4) or (5) with respect to the Company)
occurs and is continuing, the Trustee by notice to the Company, or the Holders
of at least 25% in outstanding principal amount of the Securities by notice to
the Company and the Trustee, may, and the Trustee at the request of such Holders
shall, declare the principal of, premium,
<PAGE> 35
30
if any, and accrued but unpaid interest on all the Securities to be due and
payable. Upon such a declaration, such principal, premium and interest shall be
immediately due and payable. If an Event of Default specified in Section 5.1(4)
or (5) with respect to the Company occurs, the principal of, premium, if any,
and accrued and unpaid interest on all the Securities will become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holders. The Holders of a majority in principal amount of the
Securities then outstanding by notice to the Trustee may waive all past defaults
(except with respect to nonpayment of principal, premium or interest) and
rescind an acceleration with respect to the Securities and its consequences if
(i) the rescission would not conflict with any judgment or decree of a court of
competent jurisdiction and (ii) all existing Events of Default, other than the
nonpayment of principal of, premium, if any or interest on the Securities that
has become due solely because of such acceleration, have been cured or waived.
No such rescission shall affect any subsequent Default or Event of Default or
impair any right consequent thereto.
SECTION 5.3. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal of or interest on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess
any of the Securities or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Securityholder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 5.4. Waiver of Past Defaults. The Holders of a majority in
principal amount of the Securities then outstanding by notice to the Trustee may
waive an existing Default or Event of Default and its consequences except (i) a
Default or Event of Default in the payment of the principal of or interest on a
Security or (ii) a Default or Event of Default in respect of a provision that
under Section 8.2 cannot be amended without the consent of each Securityholder
affected. When a Default or Event of Default is waived, it is deemed cured, but
no such waiver shall extend to any subsequent or other Default or Event of
Default or impair any consequent right.
SECTION 5.5. Control by Majority. The Holders of a majority in
principal amount of the Securities then outstanding may direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
or of exercising any trust or power conferred on the Trustee. However, the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture or, subject to Section 6.1, that the Trustee determines is unduly
prejudicial to the rights of other Securityholders or would involve the Trustee
in personal liability; provided, however, that the Trustee may take any other
action deemed proper by the Trustee that is not inconsistent with such
direction. Prior to taking any action under this Indenture, the Trustee shall be
entitled to indemnification satisfactory to it in its sole discretion against
all losses and expenses caused by taking or not taking such action.
<PAGE> 36
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SECTION 5.6. Limitation on Suits. A Securityholder may not pursue
any remedy with respect to this Indenture or the Securities unless:
(1) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;
(2) the Holders of at least 25% in outstanding principal amount of
the Securities make a written request to the Trustee to institute
proceedings in respect of such Event of Default;
(3) such Holder or Holders offer to the Trustee such reasonable
security or indemnity against any loss, liability or expense as the
Trustee may require;
(4) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of security or indemnity; and
(5) the Holders of a majority in principal amount of the Securities
do not give the Trustee a direction inconsistent with the request during
such 60-day period.
SECTION 5.7. Rights of Holders to Receive Payment. Notwithstanding
any other provision of this Indenture, the right of any Holder to receive
payment of principal of, premium (if any) or interest on the Securities held by
such Holder, on or after the respective due dates expressed in the Securities,
or to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
SECTION 5.8. Collection Suit by Trustee. If an Event of Default
specified in Section 5.1(1) or (2) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company for the whole amount then due and owing (together with interest on any
unpaid interest to the extent lawful) and the amounts provided for in Section
6.7.
SECTION 5.9. Trustee May File Proofs of Claim. The Trustee may file
such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the Securityholders
allowed in any judicial proceedings relative to the Company, its Subsidiaries or
their respective creditors or properties and, unless prohibited by law or
applicable regulations, may vote on behalf of the Holders in any election of a
trustee in bankruptcy or other Person performing similar functions, and any
Custodian in any such judicial proceeding is hereby authorized by each Holder to
make payments to the Trustee and, in the event that the Trustee shall consent to
the making of such payments directly to the Holders, to pay to the Trustee any
amount due it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and its counsel, and any other amounts due
the Trustee under Section 6.7.
SECTION 5.10. Priorities. If the Trustee collects any money or
property pursuant to this Article V, it shall pay out the money or property in
the following order:
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32
FIRST: to the Trustee for amounts due under Section 6.7;
SECOND: to Securityholders for amounts due and unpaid on the
Securities for principal and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the
Securities for principal and interest, respectively; and
THIRD: to the Company.
The Trustee may fix a record date and payment date for any payment
to Securityholders pursuant to this Section. At least 15 days before such record
date, the Company shall mail to each Securityholder and the Trustee a notice
that states the record date, the payment date and amount to be paid.
SECTION 5.11. Undertaking for Costs. In any suit for the enforcement
of any right or remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees and expenses, against any party
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by the Company, a suit by a Holder pursuant to
Section 5.7 or a suit by Holders of more than 10% in outstanding principal
amount of the Securities.
ARTICLE VI
Trustee
SECTION 6.1. Duties of Trustee. (a) If an Event of Default has
occurred and is continuing, the Trustee shall exercise the rights and powers
vested in it by this Indenture and use the same degree of care and skill in
their exercise as a prudent Person would exercise or use under the circumstances
in the conduct of such Person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness
of the opinions expressed therein, upon certificates or opinions furnished
to the Trustee and conforming to the requirements of this Indenture.
However, in the case of any such certificates or opinions which by any
provisions hereof are specifically required to be furnished to the
Trustee, the Trustee shall examine such certificates and opinions to
determine
<PAGE> 38
33
whether or not they conform to the requirements of this Indenture (but
need not confirm the accuracy of mathematical calculations or other facts
stated therein).
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own wilful misconduct,
except that:
(1) this paragraph does not limit the effect of paragraph (b) of
this Section;
(2) the Trustee shall not be liable for any error of judgment made
in good faith by a Trust Officer unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 5.5.
(d) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
(e) Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.
(f) No provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it.
(g) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
SECTION 6.2. Rights of Trustee. (a) The Trustee may conclusively
rely on any document believed by it to be genuine and to have been signed or
presented by the proper person. The Trustee need not investigate any fact or
matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on the
Officers' Certificate or Opinion of Counsel.
(c) The Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any agent appointed with
due care.
<PAGE> 39
34
(d) The Trustee shall not be liable for any action it takes or omits
to take in good faith which it believes to be authorized or within its rights or
powers; provided, however, that the Trustee's conduct does not constitute wilful
misconduct or negligence.
(e) The Trustee may consult with counsel of its selection, and the
advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Securities shall be full and complete authorization and
protection from liability in respect to any action taken, omitted or suffered by
it hereunder in good faith and in accordance with the advice or opinion of such
counsel.
(f) The Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request, direction, consent, order, bond or other
paper or document; but the Trustee, in its discretion, may make such further
inquiry or investigation into such facts or matters as it may see fit and, if
the Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Company,
personally or by agent or attorney at the sole cost of the Company and shall
incur no liability or additional liability of any kind by reason of such inquiry
or investigation.
(g) The Trustee shall not be deemed to have knowledge of any Default
or Event of Default except (i) any Event of Default occurring pursuant to
Section 5.1(1) and 5.1(2), or (ii) any Default or Event of Default of which the
Trustee shall have received written notification or obtained "actual knowledge."
"Actual knowledge" shall mean the actual fact or statement of knowing without
independent investigation with respect thereto.
SECTION 6.3. Individual Rights of Trustee. The Trustee in its
individual or any other capacity may become the owner or pledgee of Securities
and may otherwise deal with the Company or its Affiliates with the same rights
it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar
or co-paying agent may do the same with like rights. However, the Trustee must
comply with Sections 6.10 and 6.11.
SECTION 6.4. Trustee's Disclaimer. The Trustee shall not be
responsible for and makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for any
statement of the Company in this Indenture or in any document issued in
connection with the sale of the Securities or in the Securities other than the
Trustee's certificate of authentication or for the use or application of any
funds received by any Paying Agent other than the Trustee.
SECTION 6.5. Notice of Defaults. If a Default or Event of Default
occurs and is continuing and if a Trust Officer has actual knowledge thereof,
the Trustee shall mail to each Securityholder notice of the Default or Event of
Default within 90 days after it occurs provided that in the case of Default or
Event of Default described in Section 5.1(3), no such notice shall be given
until at least 90 days after such Default or Event of Default occurs and
provided further that except in the case of a Default or Event of Default in
payment of principal of, premium (if any), or interest on any Security, the
Trustee may withhold the
<PAGE> 40
35
notice if and so long as its board of directors, a committee of its board of
directors or a committee of its Trust Officers and/or a Trust Officer of the
Trustee in good faith determines that withholding the notice is in the interests
of Securityholders.
SECTION 6.6. Reports by Trustee to Holders. As promptly as
practicable after each May 20 beginning with May 20, 1999, and in any event
prior to July 20 in each year, the Trustee shall mail to each Securityholder a
brief report dated as of such May 20 that complies with TIA ss. 313(a). The
Trustee also shall comply with TIA ss. 313(b). The Trustee shall also transmit
by mail all reports required by TIA ss. 313(c).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the SEC and each stock exchange (if any) on which the
Securities are listed. The Company agrees to notify promptly the Trustee in
writing whenever the Securities become listed on any stock exchange and of any
delisting thereof.
SECTION 6.7. Compensation and Indemnity. The Company shall pay to
the Trustee from time to time such compensation for its services as the parties
shall agree in writing from time to time. The Trustee's compensation shall not
be limited by any law on compensation of a trustee of an express trust. The
Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses incurred or made by it, including, but not limited to,
costs of collection, costs of preparing and reviewing reports, certificates and
other documents, costs of preparation and mailing of notices to Securityholders
and reasonable costs of counsel retained by the Trustee in connection with the
delivery of an Opinion of Counsel or otherwise, in addition to the compensation
for its services. Such expenses shall include the reasonable compensation and
expenses, disbursements and advances of the Trustee's agents, counsel,
accountants and experts. The Company shall indemnify each of the Trustee, any
predecessor Trustee and each of its officers, directors, counsel and agents,
against any and all loss, liability, claim, damage or expense (including, but
not limited to, reasonable attorneys' fees and expenses and taxes other than
taxes based on the income of the Trustee) incurred by it in connection with the
acceptance and administration of this trust and the performance of its duties
hereunder, including the costs and expenses of enforcing this Indenture
(including this Section 6.7) and of defending itself against any claims (whether
asserted by any Securityholder, the Company or otherwise). The Trustee shall
notify the Company promptly of any claim for which it may seek indemnity.
Failure by the Trustee to so notify the Company shall not relieve the Company of
its obligations hereunder. The Company shall defend the claim and the Trustee
may have separate counsel and the Company shall pay the fees and expenses of
such counsel. The Company need not reimburse any expense or indemnify against
any loss, liability or expense incurred by the Trustee through the Trustee's own
wilful misconduct or negligence, subject to the exceptions contained in Section
6.1(c) hereof.
To secure the Company's payment obligations in this Section, the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee other than money or property held in trust to pay
principal of and interest on particular Securities. The Trustee's right to
receive payment of any amounts due under this Section 6.7 shall not be
subordinate to any other liability or indebtedness of the Company.
<PAGE> 41
36
The Company's payment obligations pursuant to this Section and any
lien arising hereunder shall survive the discharge of this Indenture and the
resignation or removal of the Trustee. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 5.1(4) or (5) with respect to
the Company, the expenses are intended to constitute expenses of administration
under any Bankruptcy Law.
SECTION 6.8. Replacement of Trustee. The Trustee may resign at any
time by so notifying the Company. The Holders of a majority in principal amount
of the Securities may remove the Trustee by so notifying the Company and the
Trustee in writing and may appoint a successor Trustee. The Company shall remove
the Trustee if:
(1) the Trustee fails to comply with Section 6.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or other public officer takes charge of the Trustee
or its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed by the Company or by the
Holders of a majority in principal amount of the Securities and such Holders do
not reasonably promptly appoint a successor Trustee, or if a vacancy exists in
the office of Trustee for any reason (the Trustee in such event being referred
to herein as the retiring Trustee), the Company shall promptly appoint a
successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Thereupon the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee shall have all the rights, powers and duties of the Trustee
under this Indenture. The successor Trustee shall mail a notice of its
succession to Securityholders. The retiring Trustee shall promptly transfer all
property held by it as Trustee to the successor Trustee, subject to the lien
provided for in Section 6.7.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee or the Holders of
10% in principal amount of the Securities may petition at the expense of the
Company any court of competent jurisdiction for the appointment of a successor
Trustee.
If the Trustee fails to comply with Section 6.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
Notwithstanding the replacement of the Trustee pursuant to this
Section 6.8, the Company's obligations under Section 6.7 shall continue for the
benefit of the retiring Trustee.
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SECTION 6.9. Successor Trustee by Merger. If the Trustee
consolidates with, merges or converts into, or transfers all or substantially
all its corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Trustee.
In case at the time such successor or successors by merger,
conversion or consolidation to the Trustee shall succeed to the trusts created
by this Indenture, any of the Securities shall have been authenticated but not
delivered, any such successor to the Trustee may adopt the certificate of
authentication of any predecessor trustee, and deliver such Securities so
authenticated; and in case at that time any of the Securities shall not have
been authenticated, any successor to the Trustee may authenticate such
Securities either in the name of any predecessor hereunder or in the name of the
successor to the Trustee; and in all such cases such certificates shall have the
full force which it is anywhere in the Securities or in this Indenture provided
that the certificate of the Trustee shall have.
SECTION 6.10. Eligibility; Disqualification. The Trustee shall at
all times satisfy the requirements of TIA ss. 310(a). The Trustee shall have a
combined capital and surplus of at least $50 million as set forth in its most
recent published annual report of condition. The Trustee shall comply with TIA
ss. 310(b).
SECTION 6.11. Preferential Collection of Claims Against Company. The
Trustee shall comply with TIA ss. 311(a), excluding any creditor relationship
listed in TIA ss. 311(b). A Trustee who has resigned or been removed shall be
subject to TIA ss. 311(a) to the extent indicated.
SECTION 6.12. Trustee's Application for Instructions from the
Company. Any application by the Trustee for written instructions from the
Company, may at the option of the Trustee, set forth in writing any action
proposed to be taken or omitted by the Trustee under this Indenture and the date
on and/or after which such action shall be taken or such omission shall be
effective. The Trustee shall not be liable for any action taken by, or omission
of, the Trustee in accordance with a proposal included in such application on or
after the date specified in such application (which date shall not be less than
three Business Days after the date any officer of the Company actually receives
such application, unless any such officer shall have consented in writing to any
earlier date) unless prior to taking any such action (or the effective date in
the case of an omission), the Trustee shall have received written instructions
in response to such application specifying the action to be taken or omitted.
<PAGE> 43
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ARTICLE VII
Discharge of Indenture; Defeasance
SECTION 7.1. Discharge of Liability on Securities; Defeasance. (a)
When (i) the Company delivers to the Trustee all outstanding Securities (other
than Securities replaced pursuant to Section 2.9) for cancellation or (ii) all
outstanding Securities have become due and payable at maturity and the Company
irrevocably deposits with the Trustee funds sufficient to pay at maturity all
outstanding Securities (other than Securities replaced pursuant to Section 2.9),
including interest thereon to maturity, and the Company pays all other sums
payable hereunder by the Company, then this Indenture shall, subject to Section
7.1(c), cease to be of further effect. The Trustee shall acknowledge
satisfaction and discharge of this Indenture on demand of the Company
(accompanied by an Officers' Certificate and an Opinion of Counsel stating that
all conditions precedent specified herein relating to the satisfaction and
discharge of this Indenture have been complied with) and at the cost and expense
of the Company.
(b) Subject to Sections 7.1(c) and 7.2, the Company at its option
and at any time may terminate (i) all the obligations of the Company under the
Securities and this Indenture ("legal defeasance option") or (ii) the
obligations of the Company under Sections 3.2, 3.3 and 3.4 and the Company may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such covenant or provision, whether
directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or provision or by reason of any reference in any such covenant to any
other provision herein or in any other document and such omission to comply
shall not constitute a Default or an Event of Default under Section 5.1(3)
("covenant defeasance option"), but except as specified above, the remainder of
this Indenture and the Securities shall be unaffected thereby. The Company may
exercise its legal defeasance option notwithstanding its prior exercise of its
covenant defeasance option.
If the Company exercises its legal defeasance option, payment of the
Securities may not be accelerated because of an Event of Default. If the Company
exercises its covenant defeasance option, payment of the Securities may not be
accelerated because of an Event of Default specified in Sections 5.1(3), 5.1(4)
or 5.1(5).
Upon satisfaction of the conditions set forth herein and upon
request of the Company, the Trustee shall acknowledge in writing the discharge
of those obligations that the Company terminates.
(c) Notwithstanding the provisions of Sections 7.1(a) and (b), the
Company's obligations in Sections 2.3, 2.4, 2.5, 2.6, 2.7, 2.8, 2.9, 6.7, 6.8,
7.4, 7.5 and 7.6 shall survive until the Securities have been paid in full.
Thereafter, the Company's obligations in Sections 6.7, 7.4 and 7.5 shall
survive.
<PAGE> 44
39
SECTION 7.2. Conditions to Defeasance. The Company may exercise its
legal defeasance option or its covenant defeasance option only if:
(1) the Company irrevocably deposits in trust with the Trustee for
the benefit of the Holders cash in U.S. dollars or U.S. Government
Obligations or a combination thereof for the payment of principal of and
interest on the Securities to maturity;
(2) the Company delivers to the Trustee a certificate from a
nationally recognized firm of independent accountants expressing their
opinion that the payments of principal and interest when due and without
reinvestment on the deposited U.S. Government Obligations plus any
deposited money without investment will provide cash at such times and in
such amounts as will be sufficient to pay principal and interest when due
on all the Securities to maturity;
(3) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit;
(4) in the case of the covenant defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel in the United States
to the effect that the Securityholders will not recognize income, gain or
loss for federal income tax purposes as a result of such covenant
defeasance and will be subject to federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if
such covenant defeasance had not occurred;
(5) in the case of the legal defeasance option, the Company shall
have delivered to the Trustee an Opinion of Counsel in the United States
stating that (i) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling to the effect that,
and based thereon such Opinion of Counsel shall confirm that, the
Securityholders will not recognize income, gain or loss for federal income
tax purposes as a result of such legal defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such legal defeasance had not
occurred; and
(6) the Company delivers to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all conditions precedent to the
defeasance and discharge of the Securities and this Indenture as
contemplated by this Article VII have been complied with.
SECTION 7.3. Application of Trust Money. The Trustee shall
hold in trust money or U.S. Government Obligations deposited with it pursuant to
this Article VII. It shall apply the deposited money and the money from U.S.
Government Obligations through the Paying Agent and in accordance with this
Indenture to the payment of principal of and interest on the Securities.
SECTION 7.4. Repayment to Company. Anything herein to the contrary
notwithstanding, the Trustee shall deliver or pay to the Company from time to
time upon
<PAGE> 45
40
Company Order any money or U.S. Government Obligations held by it as provided in
this Article VII which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect legal defeasance or covenant defeasance,
as applicable, provided that the Trustee shall not be required to liquidate any
U.S. Government Obligations in order to comply with the provisions of this
paragraph.
Subject to any applicable abandoned property law, the Trustee and
the Paying Agent shall pay to the Company upon written request any money held by
them for the payment of principal of or interest on the Securities that remains
unclaimed for two years, and, thereafter, Securityholders entitled to the money
must look to the Company for payment as general creditors.
SECTION 7.5. Indemnity for U.S. Government Obligations. The Company
shall pay and shall indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against deposited U.S. Government Obligations or the
principal and interest received on such U.S. Government Obligations.
SECTION 7.6. Reinstatement. If the Trustee or Paying Agent is unable
to apply any money or U.S. Government Obligations in accordance with this
Article VII by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the obligations of the Company under
this Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to this Article VII until such time as the Trustee
or Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with this Article VII; provided, however, that, if the
Company has made any payment of interest on or principal of any Securities
because of the reinstatement of its obligations, the Company shall be subrogated
to the rights of the Holders of such Securities to receive such payment from the
money or U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE VIII
Amendments
SECTION 8.1. Without Consent of Holders. The Company and the Trustee
may amend this Indenture or the Securities without notice to or consent of any
Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article IV in respect of the assumption by a
Successor Company of an obligation of the Company under this Indenture;
<PAGE> 46
41
(3) to provide for uncertificated Securities in addition to or in
place of certificated Securities; provided, however, that the
uncertificated Securities are issued in registered form for purposes of
Section 163(f) of the Code or in a manner such that the uncertificated
Securities are described in Section 163(f)(2)(B) of the Code;
(4) to add to the covenants of the Company for the benefit of the
Holders or to surrender any right or power herein conferred upon the
Company;
(5) to comply with any requirements of the SEC in connection with
qualifying this Indenture under the TIA;
(6) to comply with Sections 6.8 and 6.9 in respect of the assumption
by a successor Trustee of an obligation of the Trustee under this
Indenture;
(7) to make any change that does not adversely affect the rights of
any Securityholder; or
(8) to provide for the issuance of the Exchange Notes, which will
have terms substantially identical in all material respects to the Initial
Notes (except that the transfer restrictions contained in the Initial
Notes will be modified or eliminated, as appropriate), and which will be
treated, together with any outstanding Initial Notes, as a single issue of
securities.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section.
SECTION 8.2. With Consent of Holders. The Company and the Trustee
may amend this Indenture or the Securities without notice to any Securityholder
but with the written consent of the Holders of at least a majority in principal
amount of the Securities affected by such amendment then outstanding. However,
without the consent of each Securityholder affected, an amendment may not:
(a) change the maturity of any payment of principal of or any
premium or any installment of interest on the Securities, reduce the principal
amount thereof or the interest or any premium thereon, change the method of
computing the amount of principal thereof or interest thereon on any date,
change any place of payment where, or the coin or currency in which, the
Securities or any premium or interest thereon is payable or impair the right to
institute suit for the enforcement of any such payment on or after the maturity
thereof (or, in the case of redemption or repayment, on or after the redemption
date or the repayment date, as the case may be);
(b) reduce the percentage in principal amount of the outstanding
Securities, the consent of whose Holders is required for any such modification
or the consent of whose
<PAGE> 47
42
Holders is required for any waiver of compliance with certain provisions of this
Indenture or certain defaults thereunder and their consequences provided for in
this Indenture; or
(c) modify any of the provisions of this Section, Section 5.4 or
Section 3.5, except to increase any such percentage or to provide that certain
other provisions of this Indenture cannot be modified or waived without the
consent of the Holder of each outstanding Note affected thereby.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, but it shall
be sufficient if such consent approves the substance thereof.
After an amendment under this Section becomes effective, the Company
shall mail to Securityholders a notice briefly describing such amendment. The
failure to give such notice to all Securityholders, or any defect therein, shall
not impair or affect the validity of an amendment under this Section.
SECTION 8.3. Compliance with Trust Indenture Act. Every amendment to
this Indenture or the Securities shall comply with the TIA as then in effect.
SECTION 8.4. Revocation and Effect of Consents and Waivers. A
consent to an amendment or a waiver by a Holder of a Security shall bind the
Holder and every subsequent Holder of that Security or portion of the Security
that evidences the same debt as the consenting Holder's Security, even if
notation of the consent or waiver is not made on the Security. However, any such
Holder or subsequent Holder may revoke the consent or waiver as to such Holder's
Security or portion of the Security if the Trustee receives the notice of
revocation before the date the amendment or waiver becomes effective. After an
amendment or waiver becomes effective, it shall bind every Securityholder. An
amendment or waiver made pursuant to Section 8.2 shall become effective upon
receipt by the Trustee of the requisite number of written consents.
The Company may, but shall not be obligated to, fix a record date
for the purpose of determining the Securityholders entitled to give their
consent or take any other action described above or required or permitted to be
taken pursuant to this Indenture. If a record date is fixed, then
notwithstanding the immediately preceding paragraph, those Persons who were
Securityholders at such record date (or their duly designated proxies), and only
those Persons, shall be entitled to give such consent or to revoke any consent
previously given or to take any such action, whether or not such Persons
continue to be Holders after such record date. No such consent shall become
valid or effective more than 120 days after such record date.
SECTION 8.5. Notation on or Exchange of Securities. If an amendment
changes the terms of a Security, the Trustee may require the Holder of the
Security to deliver it to the Trustee. The Trustee may place an appropriate
notation on the Security regarding the changed terms and return it to the
Holder. Alternatively, if the Company or the Trustee so determines, the Company
in exchange for the Security shall issue and the Trustee shall
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43
authenticate a new Security that reflects the changed terms. Failure to make the
appropriate notation or to issue a new Security shall not affect the validity of
such amendment.
SECTION 8.6. Trustee To Sign Amendments. The Trustee shall sign any
amendment authorized pursuant to this Article VIII if the amendment does not
adversely affect the rights, duties, liabilities or immunities of the Trustee.
If it does, the Trustee may but need not sign it. In signing such amendment the
Trustee shall be entitled to receive indemnity reasonably satisfactory to it and
to receive, and (subject to Section 6.1) shall be fully protected in relying
upon, an Officers' Certificate and an Opinion of Counsel stating that such
amendment is authorized or permitted by this Indenture.
ARTICLE IX
Redemption of Notes
SECTION 9.1. Redemption. The Notes may or shall, as the case may be,
be redeemed, as a whole or from time to time in part, subject to the conditions
and at the Redemption Prices specified in the forms of Securities, together with
accrued interest to the Redemption Date specified in the forms of the
Securities.
SECTION 9.2. Applicability of Article. Redemption of Securities at
the election of the Company, as permitted by any provision of this Indenture,
shall be made in accordance with such provision and this Article.
SECTION 9.3. Election to Redeem; Notice to Trustee. The election of
the Company to redeem any Securities pursuant to Section 9.1 shall be evidenced
by a resolution of the Board of Directors. In case of any redemption at the
election of the Company, the Company shall, at least 60 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Securities to be redeemed and shall deliver to the
Trustee such documentation and records as shall enable the Trustee to select the
Securities to be redeemed pursuant to Section 9.4.
SECTION 9.4. Selection by Trustee of Securities to Be Redeemed. If
less than all the Securities are to be redeemed, selection of such Securities
for redemption shall be made by the Trustee not more than 60 days prior to the
Redemption Date, from the Securities outstanding not previously called for
redemption, in compliance with the requirements of the principal national
securities exchange, if any, on which such Securities are listed, or, if such
Securities are not so listed, on a pro rata basis, by lot or by such other
method as the Trustee shall deem fair and appropriate (and in such manner as
complies with applicable legal requirements) and which may provide for the
selection for redemption of portions of the principal of Securities; provided,
however, that no Securities of less than $1,000 shall be redeemed in part.
<PAGE> 49
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The Trustee shall promptly notify the Company in writing of the
Securities selected for redemption and, in the case of any Securities selected
for partial redemption, the principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to redemption of Securities shall relate, in
the case of any Security redeemed or to be redeemed only in part, to the portion
of the principal amount of such Security which has been or is to be redeemed.
SECTION 9.5. Notice of Redemption. Notice of redemption shall be
given in the manner provided for in Section 10.2 at least 30 but not more than
60 days prior to the Redemption Date, to each Holder of Securities to be
redeemed at such Holder's registered address. The Trustee shall give notice of
redemption in the Company's name and at the Company's expense; provided,
however, that the Company shall deliver to the Trustee, at least 30 days prior
to the Redemption Date, an Officers' Certificate requesting that the Trustee
give such notice and setting forth the information to be stated in such notice
as provided in the following items.
All notices of redemption shall fully identify the Securities and
shall state:
(1) the Redemption Date,
(2) the Redemption Price and the amount of accrued interest to the
Redemption Date payable as provided in Section 9.07, if any,
(3) if less than all Securities outstanding are to be redeemed, the
identification of the particular Securities (or portion thereof) to be
redeemed, as well as the aggregate principal amount of Securities to be
redeemed and the aggregate principal amount of Securities to be
outstanding after such partial redemption,
(4) in case any Security is to be redeemed in part only, the notice
which relates to such Security shall state that on and after the
Redemption Date, upon surrender of such Security, the holder will receive,
without charge, a new Security or Securities of authorized denominations
for the principal amount thereof remaining unredeemed,
(5) that on the Redemption Date the Redemption Price (and accrued
interest, if any, to the Redemption Date payable as provided in Section
9.7) will become due and payable upon each such Security, or the portion
thereof, to be redeemed, and, unless the Company defaults in making the
redemption payment, that interest on Securities called for redemption (or
the portion thereof) will cease to accrue on and after said date,
(6) the place or places where such Securities are to be surrendered
for payment of the Redemption Price and accrued interest, if any,
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(7) the name and address of the Paying Agent,
(8) that Securities called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price, and
(9) the CUSIP number, and that no representation is made as to the
accuracy or correctness of the CUSIP number, if any, listed in such notice
or printed on the Securities.
SECTION 9.6. Deposit of Redemption Price. Prior to any Redemption
Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if
the Company is acting as its own Paying Agent, segregate and hold in trust as
provided in Section 3.7) an amount of money sufficient to pay the Redemption
Price of, and accrued interest on, all the Securities which are to be redeemed
on that date.
SECTION 9.7. Securities Payable on Redemption Date. Notice of
redemption having been given as aforesaid, the Securities so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified (together with accrued interest, if any, to the Redemption
Date), and from and after such date (unless the Company shall default in the
payment of the Redemption Price and accrued interest) such Notes shall cease to
bear interest. Upon surrender of any such Note for redemption in accordance with
said notice, such Note shall be paid by the Company at the Redemption Price,
together with accrued interest, if any, to the Redemption Date; provided,
however, that installments of interest whose maturity is on or prior to the
Redemption Date shall be payable to the Holders of such Securities, or one or
more Predecessor Notes, registered as such at the close of business on the
relevant regular record date or Special Record Date, as the case may be,
according to their terms and the provisions of Section 2.13.
If any Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate borne by the
Securities.
SECTION 9.8. Securities Redeemed in Part. Any Security which is to
be redeemed only in part (pursuant to the provisions of this Article) shall be
surrendered at the office or agency of the Company maintained for such purpose
pursuant to Section 3.6 (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or such Holder's
attorney duly authorized in writing), and the Company shall execute, and the
Trustee shall authenticate and deliver to the Holder of such Note without
service charge, a new Security or Securities, of any authorized denomination as
requested by such Holder, in an aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Security so
surrendered; provided that each such new Security will be in a principal amount
of $1,000 or integral multiple thereof.
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ARTICLE X
Miscellaneous
SECTION 10.1. Trust Indenture Act Controls. If any provision of this
Indenture limits, qualifies or conflicts with another provision which is
required to be included in this Indenture by the TIA, the provision required by
the TIA shall control.
SECTION 10.2. Notices. Any notice or communication shall be in
writing and delivered in person or mailed by first-class mail addressed as
follows:
if to the Company:
CBS Corporation
51 West 52nd Street
New York, New York 10019
Attn: Chief Financial Officer
if to the Trustee:
Citibank, N.A.
111 Wall Street, 5th Floor
New York, New York 10043
Attn: Corporate Trust Department
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Securityholder shall be
mailed to the Securityholder at the Securityholder's address as it appears on
the registration books of the Registrar and shall be sufficiently given if so
mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
SECTION 10.3. Communication by Holders with other Holders.
Securityholders may communicate pursuant to TIA ss. 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA ss. 312(c).
SECTION 10.4. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take or refrain
from taking any action under this Indenture, the Company shall furnish to the
Trustee:
<PAGE> 52
47
(1) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of the signers,
all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with; and
(2) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee stating that, in the opinion of such counsel,
all such conditions precedent have been complied with.
SECTION 10.5. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a covenant or condition
provided for in this Indenture shall include:
(1) a statement that the individual making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such individual, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether or not, in the opinion of such
individual, such covenant or condition has been complied with.
SECTION 10.6. When Securities Disregarded. In determining whether
the Holders of the required principal amount of Securities have concurred in any
direction, waiver or consent, Securities owned by the Company or by any Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with the Company shall be disregarded and deemed not to be
outstanding, except that, for the purpose of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Securities which the Trustee knows are so owned shall be so disregarded. Also,
subject to the foregoing, only Securities outstanding at the time shall be
considered in any such determination.
SECTION 10.7. Rules by Trustee, Paying Agent and Registrar. The
Trustee may make reasonable rules for action by, or a meeting of,
Securityholders. The Registrar and the Paying Agent may make reasonable rules
for their functions.
SECTION 10.8. Legal Holidays. A "Legal Holiday" is a Saturday, a
Sunday or other day on which commercial banking institutions are authorized or
required to be closed in New York City. If a payment date is a Legal Holiday,
payment shall be made on the next succeeding day that is not a Legal Holiday,
and no interest shall accrue for the intervening period. If a regular record
date is a Legal Holiday, the record date shall not be affected.
<PAGE> 53
48
SECTION 10.9. Governing Law. This Indenture and the Securities shall
be governed by, and construed in accordance with, the laws of the State of New
York but without giving effect to applicable principles of conflicts of law to
the extent that the application of the laws of another jurisdiction would be
required thereby.
SECTION 10.10. No Recourse Against Others. An incorporator,
director, officer, employee, stockholder or controlling person, as such, of the
Company shall not have any liability for any obligations of the Company under
the Securities or this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder shall waive and release all such liability. The waiver and
release shall be part of the consideration for the issue of the Securities.
SECTION 10.11. Successors. All agreements of the Company in this
Indenture and the Securities shall bind their respective successors. All
agreements of the Trustee in this Indenture shall bind its successors.
SECTION 10.12. Multiple Originals. The parties may sign any number
of copies of this Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement. One signed copy is enough to prove
this Indenture.
SECTION 10.13. Variable Provisions. The Company initially appoints
the Trustee as Paying Agent and Registrar and custodian with respect to any
Global Securities.
SECTION 10.14. Qualification of Indenture. The Company shall qualify
this Indenture under the TIA in accordance with the terms and conditions of the
Registration Rights Agreement and shall pay all reasonable costs and expenses
(including attorneys' fees and expenses for the Company and the Trustee)
incurred in connection therewith, including, but not limited to, costs and
expenses of qualification of the Indenture and the Securities and printing this
Indenture and the Securities. The Trustee shall be entitled to receive from the
Company any such Officers' Certificates, Opinions of Counsel or other
documentation as it may reasonably request in connection with any such
qualification of this Indenture under the TIA.
SECTION 10.15. Table of Contents; Headings. The table of contents,
cross-reference sheet and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not intended
to be considered a part hereof and shall not modify or restrict any of the terms
or provisions hereof.
<PAGE> 54
IN WITNESS WHEREOF, the parties have caused this Indenture to be
duly executed as of the date first written above.
CBS CORPORATION
By: /s/ Fredric G. Reynolds
------------------------------
Name: Fredric G. Reynolds
Title: Executive Vice President
and Chief Financial Officer
CITIBANK, N.A.
By: /s/ F. Mills
------------------------------
Name: F. Mills
Title: Senior Trust Officer
<PAGE> 55
EXHIBIT A
[FORM OF FACE OF INITIAL NOTE]
[Applicable Restricted Securities Legend]
[Depository Legend, if applicable]
No. 1 Principal Amount $____]
CUSIP NO. ____________
CBS CORPORATION
7.15% Senior Note due 2005
CBS Corporation, a Pennsylvania corporation promises to pay to
[___________], or registered assigns, the principal sum of [__________________]
Dollars on May 20, 2005.
Interest Payment Dates: May 20 and November 20.
Record Dates: May 1 and November 1.
Additional provisions of this Security are set forth on the other
side of this Security.
<PAGE> 56
[FORM OF REVERSE SIDE OF INITIAL NOTE]
7.15% Senior Note due 2005
1. Interest
CBS Corporation, a Pennsylvania corporation (such corporation, and
its successors and assigns under the Indenture hereinafter referred to, being
herein called the "Company") promises to pay interest on the principal amount of
this Security at the rate per annum shown above.
The Company will pay interest semiannually on May 20 and November 20
of each year. Interest on the Securities will accrue from the most recent date
to which interest has been paid on the Securities or, if no interest has been
paid, from May 20, 1998. The Company shall pay interest on overdue principal or
premium, if any (plus interest on such interest to the extent lawful), at the
rate borne by the Securities to the extent lawful. Interest will be computed on
the basis of a 360-day year of twelve 30-day months.
2. Optional Redemption
The Company may redeem the Securities in whole or, from time to
time, in part on at least 30 but not more than 60 days prior notice mailed to
the Depositary, at a redemption price equal to the greater of (i) 100% of the
principal amount of the Securities to be redeemed and (ii) the sum of the
present value of the Remaining Scheduled Payments on the Securities to be
redeemed discounted to the date of redemption, on a semiannual basis, at the
Treasury Rate plus 25 basis points plus accrued interest thereon to the date of
redemption.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Notes to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the Notes. "Independent Investment Banker"
means one of the Reference Treasury Dealers appointed by the Company.
"Comparable Treasury Price" means, with respect to any redemption
date, (i) the average of the bid and asked price for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) on the
third Business Day preceding such redemption date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such Business Day, (A) the average
of the Reference Treasury Dealer Quotations for such redemption date, after
excluding the highest and lowest such Reference Treasury Dealer Quotations, or
(B) if the Trustee obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such Quotations. "Reference Treasury Dealer
Quotations" means, with respect to each Reference Treasury Dealer and any
redemption date, the average, as determined by the Trustee, of the bid and
<PAGE> 57
2
asked prices for the Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to the Trustee by such
Reference Treasury Dealer at 5:00 p.m. on the third Business Day preceding such
redemption date.
"Reference Treasury Dealer" means each of Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Chase Securities Inc., and J.P. Morgan Securities
Inc. and their respective successors and, at the option of the Company,
additional Primary Treasury Dealers; provided, however, that if any of the
foregoing shall cease to be a primary U.S. Government securities dealer in The
City of New York (a "Primary Treasury Dealer"), the Company shall substitute
therefor another Primary Treasury Dealer.
"Remaining Scheduled Payments" means, with respect to any Note, the
remaining scheduled payments of the principal thereof to be redeemed and
interest thereon that would be due after the related redemption date but for
such redemption; provided, however, that, if such redemption date is not an
interest payment date with respect to such Note, the amount of the next
succeeding scheduled interest payment thereon will be reduced by the amount of
interest accrued thereon to such redemption date.
"Treasury Rate" means, with respect to any redemption date, the rate
per annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date.
3. Method of Payment
By at least 10:00 a.m. (New York City time) on the date on which any
principal of or interest on any Security is due and payable, the Company shall
irrevocably deposit with the Trustee or the Paying Agent money sufficient to pay
such principal, premium, if any, and/or interest. The Company will pay interest
(except Defaulted Interest) to the Persons who are registered Holders of
Securities at the close of business on the May 1 or November 1 next preceding
the interest payment date even if Securities are cancelled or repurchased after
the record date and on or before the interest payment date. Holders must
surrender Securities to a Paying Agent to collect principal payments. The
Company will pay principal and interest in money of the United States that at
the time of payment is legal tender for payment of public and private debts.
However, the Company may pay principal and interest by check payable in such
money. It may mail an interest check to a Holder's registered address.
4. Paying Agent and Registrar
Initially, Citibank, N.A., a national banking association
("Trustee"), will act as Paying Agent and Registrar. The Company may appoint and
change any Paying Agent, Registrar or co-registrar without notice to any
Securityholder. The Company or any of its domestically incorporated Subsidiaries
may act as Paying Agent, Registrar or co-registrar.
<PAGE> 58
3
5. Indenture
The Company issued the Securities under an Indenture dated as of May
20, 1998 (as it may be amended or supplemented from time to time in accordance
with the terms thereof, the "Indenture"), between the Company and the Trustee.
The terms of the Securities include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C.
ss.ss. 77aaa-77bbbb), as amended (the "Act"), as in effect on the date hereof
(except as provided in Section ss. 8.3) until such time as this Indenture is
qualified under the TIA, and thereafter, as in effect on the date on which this
Indenture is qualified under the TIA (except as provided in Section ss. 8.3).
Capitalized terms used herein and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms.
The Securities are general unsecured senior obligations of the
Company limited to $500.0 million aggregate principal amount (subject to Section
2.9 of the Indenture). This Security is one of the Initial Notes referred to in
the Indenture. The Securities include the Initial Notes and any Exchange Notes
issued in exchange for the Initial Notes pursuant to the Indenture and the
Registration Rights Agreement. The Initial Notes and the Exchange Notes are
treated as a single class of securities under the Indenture. The Indenture
imposes certain limitations on liens and sale and lease-back transactions by the
Company and its Restricted Subsidiaries.
6. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of principal amount of $1,000 and whole multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes and fees required by law
or permitted by the Indenture. The Registrar need not register the transfer of
or exchange any Securities for a period beginning 15 days before an interest
payment date and ending on such interest payment date.
7. Persons Deemed Owners
The registered holder of this Security may be treated as the owner
of it for all purposes.
8. Unclaimed Money
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee or Paying Agent shall pay the money back to the
Company at its request unless an abandoned property law designates another
Person. After any such payment, Holders entitled to the money must look only to
the Company and not to the Trustee for payment.
<PAGE> 59
4
9. Defeasance
Subject to certain conditions set forth in the Indenture, the
Company at any time may terminate some or all of its obligations under the
Securities and the Indenture if the Company deposits with the Trustee money or
U.S. Government Obligations for the payment of principal and interest on the
Securities to maturity.
10. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount of the then outstanding
Securities and (ii) any default (other than with respect to nonpayment and
compliance with certain covenants under the Indenture) or noncompliance with any
provision may be waived with the written consent of the Holders of a majority in
principal amount of the then outstanding Securities. Subject to certain
exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company and the Trustee may amend the Indenture or the
Securities to cure any ambiguity, omission, defect or inconsistency, or to
comply with Article IV of the Indenture, or to provide for uncertificated
Securities in addition to or in place of certificated Securities, or to add
additional covenants or surrender rights and powers conferred on the Company, or
to comply with any request of the SEC in connection with qualifying the
Indenture under the Act, or to make any change that does not adversely affect
the rights of any Securityholder, or to provide for the issuance of Exchange
Notes.
11. Defaults and Remedies
Under the Indenture, Events of Default include (i) default for 30
days in payment of interest on the Securities; (ii) default in payment of
principal on the Securities at maturity; (iii) default in the performance of or
a breach by the Company in respect of any other covenant or agreement in the
Indenture or the Securities (other than those specified in (i) and (ii) above)
and such default continues for 90 days after notice is given; and (iv) certain
events of bankruptcy or insolvency with respect to the Company. If an Event of
Default occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the Securities then outstanding may declare all the
Securities to be due and payable immediately. Certain events of bankruptcy or
insolvency are Events of Default which will result in the Securities being due
and payable immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the Securities
except as provided in the Indenture. The Trustee may refuse to enforce the
Indenture or the Securities unless it receives reasonable indemnity or security.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default or
Event of Default (except a Default or Event of Default in payment of principal
or interest) if it determines that withholding notice is in their interest.
<PAGE> 60
5
12. Trustee Dealings with the Company
Subject to certain limitations set forth in the Indenture, the
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company or its affiliates and may otherwise deal
with the Company or its affiliates with the same rights it would have if it were
not Trustee.
13. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the
Company shall not have any liability for any obligations of the Company under
the Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder waives and releases all such liability. The waiver and release
are part of the consideration for the issue of the Securities.
14. Authentication
This Security shall not be valid until an authorized signatory of
the Trustee (or an authenticating agent acting on its behalf) manually signs the
certificate of authentication on the other side of this Security.
15. Abbreviations
Customary abbreviations may be used in the name of a Securityholder
or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants
in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
16. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities. No representation is made as to the accuracy of such
numbers as printed on the Securities and reliance may be placed only on the
other identification numbers placed thereon.
17. Governing Law
This Security shall be governed by, and construed in accordance
with, the laws of the State of New York but without giving effect to applicable
principles of conflicts of law to the extent that the application of the laws of
another jurisdiction would be required thereby.
<PAGE> 61
6
The Company will furnish to any Securityholder upon written request
and without charge to the Securityholder a copy of the Indenture which has in it
the text of this Security in larger type. Requests may be made to:
CBS Corporation
51 West 52nd Street
New York, New York 10019
Attn: Chief Financial Officer
<PAGE> 62
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
_____________________________________________________
(Print or type assignee's name, address and zip code)
_____________________________________________
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint______________________agent to transfer this Security on
the books of the Company. The agent may substitute another to act for him.
________________________________________________________________________________
Date:____________________ Your Signature:___________________
Signature Guarantee:______________________________
(Signature must be guaranteed)
________________________________________________________________________________
Sign exactly as your name appears on the other side of this Security.
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
In connection with any transfer or exchange of any of the Securities evidenced
by this certificate occurring prior to the date that is two years after the
later of the date of original issuance of such Securities and the last date, if
any, on which such Securities were owned by the Company or any Affiliate of the
Company, the undersigned confirms that such Securities are being:
CHECK ONE BOX BELOW:
1 |_| acquired for the undersigned's own account, without transfer; or
2 |_| transferred to the Company; or
3 |_| transferred pursuant to and in compliance with Rule 144A under the
Securities Act of 1933, as amended (the "Securities Act"); or
<PAGE> 63
2
4 |_| transferred pursuant to an effective registration statement under
the Securities Act; or
5 |_| transferred pursuant to and in compliance with Regulation S under
the Securities Act; or
6 |_| transferred to an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act), that has
furnished to the Trustee a signed letter containing certain
representations and agreements (the form of which letter appears as
Section 2.7 of the Indenture); or
7 |_| transferred pursuant to another available exemption from the
registration requirements of the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register any of
the Securities evidenced by this certificate in the name of any person other
than the registered holder thereof; provided, however, that if box (5), (6) or
(7) is checked, the Trustee or the Company may require, prior to registering any
such transfer of the Securities, in their sole discretion, such legal opinions,
certifications and other information as the Trustee or the Company may
reasonably request to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, such as the exemption provided by
Rule 144 under such Act.
------------------------------
Signature
Signature Guarantee:
- ------------------------- ------------------------------
(Signature must be guaranteed) Signature
- ------------------------------------------------------------
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
<PAGE> 64
3
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have
been made:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Amount of decrease in Amount of increase in Principal Amount of this Signature of authorized
Date of Principal Amount of this Principal Amount of this Global Security following signatory of Trustee or
Exchange Global Security Global Security such decrease or increase Securities Custodian
</TABLE>
<PAGE> 65
EXHIBIT B
[FORM OF FACE OF EXCHANGE NOTE]
[Depository Legend, if applicable]
No. [_____] Principal Amount $[____________]
CUSIP NO. _____________
CBS CORPORATION
7.15% Senior Notes due 2005
CBS Corporation, a Pennsylvania corporation, promises to pay to
[______________], or registered assigns, the principal sum of [_______________]
Dollars on May 20, 2005.
Interest Payment Dates: May 20 and November 20.
Record Dates: May 1 and November 1.
Additional provisions of this Security are set forth on the other
side of this Security.
CBS CORPORATION
By:_______________________
By:_______________________
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
CITIBANK, N.A.
as Trustee, certifies
that this is one of
the Securities referred
to in the Indenture.
By:__________________________
Authorized Signatory Date:
<PAGE> 66
[FORM OF REVERSE SIDE OF EXCHANGE NOTE]
7.15% Senior Note due 2005
1. Interest
CBS Corporation, a Pennsylvania corporation (such corporation, and
its successors and assigns under the Indenture hereinafter referred to, being
herein called the "Company") promises to pay interest on the principal amount of
this Security at the rate per annum shown above.
The Company will pay interest semiannually on May 20 and November 20
of each year. Interest on the Securities will accrue from the most recent date
to which interest has been paid on the Securities or, if no interest has been
paid, from May 20, 1998. The Company shall pay interest on overdue principal or
premium, if any (plus interest on such interest to the extent lawful), at the
rate borne by the Securities to the extent lawful. Interest will be computed on
the basis of a 360-day year of twelve 30-day months.
2. Optional Redemption
The Company may redeem the Securities in whole or, from time to
time, in part on at least 30 but not more than 60 days prior notice mailed to
the Depositary, at a redemption price equal to the greater of (i) 100% of the
principal amount of the Securities to be redeemed and (ii) the sum of the
present value of the Remaining Scheduled Payments on the Securities to be
redeemed discounted to the date of redemption, on a semiannual basis, at the
Treasury Rate plus 25 basis points plus accrued interest thereon to the date of
redemption.
"Comparable Treasury Issue" means the United States Treasury
security selected by an Independent Investment Banker as having a maturity
comparable to the remaining term of the Notes to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of the Notes. "Independent Investment Banker"
means one of the Reference Treasury Dealers appointed by the Company.
"Comparable Treasury Price" means, with respect to any redemption
date, (i) the average of the bid and asked price for the Comparable Treasury
Issue (expressed in each case as a percentage of its principal amount) on the
third Business Day preceding such redemption date, as set forth in the daily
statistical release (or any successor release) published by the Federal Reserve
Bank of New York and designated "Composite 3:30 p.m. Quotations for U.S.
Government Securities" or (ii) if such release (or any successor release) is not
published or does not contain such prices on such Business Day, (A) the average
of the Reference Treasury Dealer Quotations for such redemption date, after
excluding the highest and lowest such Reference Treasury Dealer Quotations, or
(B) if the Trustee obtains fewer than four such Reference Treasury Dealer
Quotations, the average of all such Quotations. "Reference Treasury Dealer
Quotations" means, with respect to each Reference Treasury Dealer and any
redemption date, the average, as determined by the Trustee, of the bid and asked
prices for the Comparable Treasury Issue (expressed in each case as a percentage
of its
<PAGE> 67
2
principal amount) quoted in writing to the Trustee by such Reference Treasury
Dealer at 5:00 p.m. on the third Business Day preceding such redemption date.
"Reference Treasury Dealer" means each of Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Chase Securities Inc., and J.P. Morgan Securities
Inc. and their respective successors and, at the option of the Company,
additional Primary Treasury Dealers; provided, however, that if any of the
foregoing shall cease to be a primary U.S. Government securities dealer in The
City of New York (a "Primary Treasury Dealer"), the Company shall substitute
therefor another Primary Treasury Dealer.
"Remaining Scheduled Payments" means, with respect to any Note, the
remaining scheduled payments of the principal thereof to be redeemed and
interest thereon that would be due after the related redemption date but for
such redemption; provided, however, that, if such redemption date is not an
interest payment date with respect to such Note, the amount of the next
succeeding scheduled interest payment thereon will be reduced by the amount of
interest accrued thereon to such redemption date.
"Treasury Rate" means, with respect to any redemption date, the rate
per annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date.
3. Method of Payment
By at least 10:00 a.m. (New York City time) on the date on which any
principal of or interest on any Security is due and payable, the Company shall
irrevocably deposit with the Trustee or the Paying Agent money sufficient to pay
such principal, premium, if any, and/or interest. The Company will pay interest
(except Defaulted Interest) to the Persons who are registered Holders of
Securities at the close of business on the May 1 or November 1 next preceding
the interest payment date even if Securities are cancelled or repurchased after
the record date and on or before the interest payment date. Holders must
surrender Securities to a Paying Agent to collect principal payments. The
Company will pay principal and interest in money of the United States that at
the time of payment is legal tender for payment of public and private debts.
However, the Company may pay principal and interest by check payable in such
money. It may mail an interest check to a Holder's registered address.
4. Paying Agent and Registrar
Initially, Citibank, N.A., a national banking association
("Trustee"), will act as Paying Agent and Registrar. The Company may appoint and
change any Paying Agent, Registrar or co-registrar without notice to any
Securityholder. The Company or any of its domestically incorporated Subsidiaries
may act as Paying Agent, Registrar or co-registrar.
<PAGE> 68
3
5. Indenture
The Company issued the Securities under an Indenture dated as of May
20, 1998 (as it may be amended or supplemented from time to time in accordance
with the terms thereof, the "Indenture"), between the Company and the Trustee.
The terms of the Securities include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C.
ss.ss. 77aaa-77bbbb), as amended (the "Act"), as in effect on the date hereof
(except as provided in Section ss. 8.3) until such time as this Indenture is
qualified under the TIA, and thereafter, as in effect on the date on which this
Indenture is qualified under the TIA (except as provided in Section S 8.3).
Capitalized terms used herein and not defined herein have the meanings ascribed
thereto in the Indenture. The Securities are subject to all such terms, and
Securityholders are referred to the Indenture and the Act for a statement of
those terms.
The Securities are general unsecured senior obligations of the
Company limited to $500.0 million aggregate principal amount (subject to Section
2.9 of the Indenture). This Security is one of the Exchange Notes referred to in
the Indenture. The Securities include the Initial Notes and the Exchange Notes
issued in exchange for the Initial Notes pursuant to the Indenture and the
Registration Rights Agreement. The Initial Notes and the Exchange Notes are
treated as a single class of securities under the Indenture. The Indenture
imposes certain limitations on liens and sale and lease-back transactions by the
Company and its Restricted Subsidiaries.
6. Denominations; Transfer; Exchange
The Securities are in registered form without coupons in
denominations of principal amount of $1,000 and whole multiples of $1,000. A
Holder may transfer or exchange Securities in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements or transfer documents and to pay any taxes and fees required by law
or permitted by the Indenture. The Registrar need not register the transfer of
or exchange any Securities for a period beginning 15 days before an interest
payment date and ending on such interest payment date.
7. Persons Deemed Owners
The registered holder of this Security may be treated as the owner
of it for all purposes.
8. Unclaimed Money
If money for the payment of principal or interest remains unclaimed
for two years, the Trustee or Paying Agent shall pay the money back to the
Company at its request unless an abandoned property law designates another
person. After any such payment, Holders entitled to the money must look only to
the Company and not to the Trustee for payment.
<PAGE> 69
4
9. Defeasance
Subject to certain conditions set forth in the Indenture, the
Company at any time may terminate some or all of its obligations under the
Securities and the Indenture if the Company deposits with the Trustee money or
U.S. Government Obligations for the payment of principal and interest on the
Securities to maturity.
10. Amendment, Waiver
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in principal amount of the then outstanding
Securities and (ii) any default (other than with respect to nonpayment and
compliance with certain covenants under the Indenture) or noncompliance with any
provision may be waived with the written consent of the Holders of a majority in
principal amount of the then outstanding Securities. Subject to certain
exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company and the Trustee may amend the Indenture or the
Securities to cure any ambiguity, omission, defect or inconsistency, or to
comply with Article IV of the Indenture, or to provide for uncertificated
Securities in addition to or in place of certificated Securities, or to add
additional covenants or surrender rights and powers conferred on the Company or
Communications or to comply with any request of the SEC in connection with
qualifying the Indenture under the Act, or to make any change that does not
adversely affect the rights of any Securityholder, or to provide for the
issuance of Exchange Notes.
11. Defaults and Remedies
Under the Indenture, Events of Default include (i) default for 30
days in payment of interest on the Securities; (ii) default in payment of
principal on the Securities at maturity; (iii) default in the performance of or
a breach by the Company in respect of any other covenant or agreement in the
Indenture or the Securities (other than those specified in (i) and (ii) above)
and such default continues for 90 days after notice is given; and (iv) certain
events of bankruptcy or insolvency with respect to the Company. If an Event of
Default occurs and is continuing, the Trustee or Holders of at least 25% in
principal amount of the Securities then outstanding may declare all the
Securities to be due and payable immediately. Certain events of bankruptcy or
insolvency are Events of Default which will result in the Securities being due
and payable immediately upon the occurrence of such Events of Default.
Securityholders may not enforce the Indenture or the Securities
except as provided in the Indenture. The Trustee may refuse to enforce the
Indenture or the Securities unless it receives reasonable indemnity or security.
Subject to certain limitations, Holders of a majority in principal amount of the
Securities may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Securityholders notice of any continuing Default or
Event of Default (except a Default or Event of Default in payment of principal
or interest) if it determines that withholding notice is in their interest.
<PAGE> 70
5
12. Trustee Dealings with the Company
Subject to certain limitations set forth in the Indenture, the
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Securities and may otherwise deal with and collect
obligations owed to it by the Company or its affiliates and may otherwise deal
with the Company or its affiliates with the same rights it would have if it were
not Trustee.
13. No Recourse Against Others
A director, officer, employee or stockholder, as such, of the
Company shall not have any liability for any obligations of the Company under
the Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder waives and releases all such liability. The waiver and release
are part of the consideration for the issue of the Securities.
14. Authentication
This Security shall not be valid until an authorized signatory of
the Trustee (or an authenticating agent acting on its behalf) manually signs the
certificate of authentication on the other side of this Security.
15. Abbreviations
Customary abbreviations may be used in the name of a Securityholder
or an assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entirety), JT TEN (=joint tenants with rights of survivorship and not as tenants
in common), CUST (=custodian) and U/G/M/A (=Uniform Gift to Minors Act).
16. CUSIP Numbers
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities. No representation is made as to the accuracy of such
numbers as printed on the Securities and reliance may be placed only on the
other identification numbers placed thereon.
17. Governing Law
This Security shall be governed by, and construed in accordance
with, the laws of the State of New York but without giving effect to applicable
principles of conflicts of law to the extent that the application of the laws of
another jurisdiction would be required thereby.
<PAGE> 71
6
The Company will furnish to any Securityholder upon request and
without charge to the Securityholder a copy of the Indenture which has in it the
text of this Security in larger type. Requests may be made to:
CBS Corporation
51 West 52nd Street
New York, New York 10019
Attn: Chief Financial Officer
<PAGE> 72
ASSIGNMENT FORM
To assign this Security, fill in the form below:
I or we assign and transfer this Security to
_____________________________________________________
(Print or type assignee's name, address and zip code)
_____________________________________________
(Insert assignee's soc. sec. or tax I.D. No.)
and irrevocably appoint___________________agent to transfer this Security on the
books of the Company. The agent may substitute another to act for him.
________________________________________________________________________________
Date: _______________ Your Signature ____________________
Signature Guarantee: ____________________________________
(Signature must be guaranteed)
________________________________________________________________________________
Sign exactly as your name appears on the other side of this Security.
Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
<PAGE> 73
2
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL SECURITY
The following increases or decreases in this Global Security have
been made:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Amount of decrease in Amount of increase in Principal Amount of this Signature of authorized
Date of Principal Amount of this Principal Amount of this Global Security following signatory of Trustee or
Exchange Global Security Global Security such decrease or increase Securities Custodian
</TABLE>
<PAGE> 1
EXHIBIT 4(d)
------------------------------------
Registration Rights Agreement
Dated As of May 20, 1998
among
CBS Corporation
and
Merrill Lynch, Pierce, Fenner & Smith
Incorporated,
Chase Securities Inc.
and
J.P. Morgan Securities Inc.
------------------------------------
<PAGE> 2
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made and
entered into this 20 day of May, 1998, among CBS Corporation, a Pennsylvania
corporation (the "Company"), and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, Chase Securities Inc. and J.P. Morgan Securities Inc.
(collectively, the "Initial Purchasers").
This Agreement is made pursuant to the Purchase Agreement, dated May
15, 1998, among the Company and the Initial Purchasers (the "Purchase
Agreement"), which provides for the sale by the Company to the Initial
Purchasers of an aggregate of $500,000,000 principal amount of the Company's
7.15% Senior Notes due 2005 (the "Securities"). In order to induce the Initial
Purchasers to enter into the Purchase Agreement, the Company has agreed to
provide to the Initial Purchasers and their direct and indirect transferees the
registration rights set forth in this Agreement. The execution of this Agreement
is a condition to the closing under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. Definitions.
As used in this Agreement, the following capitalized defined terms
shall have the following meanings:
"1933 Act" shall mean the Securities Act of 1933, as amended from
time to time.
"1934 Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
"Closing Date" shall mean the Closing Time as defined in the
Purchase Agreement.
"Company" shall have the meaning set forth in the preamble and shall
also include the Company's successors.
"Depositary" shall mean The Depository Trust Company, or any other
depositary appointed by the Company, provided, however, that such
depositary must have an address in the Borough of Manhattan, in The City
of New York.
"Exchange Offer" shall mean the exchange offer by the Company of
Exchange Securities for Registrable Securities pursuant to Section 2.1
hereof.
"Exchange Offer Registration" shall mean a registration under the
1933 Act effected pursuant to Section 2.1 hereof.
<PAGE> 3
2
"Exchange Offer Registration Statement" shall mean an exchange offer
registration statement on Form S-4 (or, if applicable, on another
appropriate form), and all amendments and supplements to such registration
statement, including the Prospectus contained therein, all exhibits
thereto and all documents incorporated by reference therein.
"Exchange Period" shall have the meaning set forth in Section 2.1
hereof.
"Exchange Securities" shall mean the 7.15% Senior Notes due 2008
issued by the Company under the Indenture containing terms identical to
the Securities in all material respects (except for references to certain
interest rate provisions, restrictions on transfers and restrictive
legends), to be offered to Holders of Securities in exchange for
Registrable Securities pursuant to the Exchange Offer.
"Holder" shall mean an Initial Purchaser, for so long as it owns any
Registrable Securities, and each of its successors, assigns and direct and
indirect transferees who become registered owners of Registrable
Securities under the Indenture and each Participating Broker-Dealer that
holds Exchange Securities for so long as such Participating Broker-Dealer
is required to deliver a prospectus meeting the requirements of the 1933
Act in connection with any resale of such Exchange Securities.
"Indenture" shall mean the Indenture relating to the Securities,
dated as of May 20, 1998, between the Company and Citibank, N.A., as
trustee, as the same may be amended, supplemented, waived or otherwise
modified from time to time in accordance with the terms thereof.
"Initial Purchaser" or "Initial Purchasers" shall have the meaning
set forth in the preamble.
"Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of Outstanding (as defined in the Indenture)
Registrable Securities; provided that whenever the consent or approval of
Holders of a specified percentage of Registrable Securities is required
hereunder, Registrable Securities held by the Company and other obligors
on the Securities or any Affiliate (as defined in the Indenture) of the
Company shall be disregarded in determining whether such consent or
approval was given by the Holders of such required percentage amount.
"Participating Broker-Dealer" shall mean any of Merrill Lynch,
Pierce, Fenner & Smith Incorporated, Chase Securities Inc. and J.P. Morgan
Securities Inc. and any other broker-dealer which makes a market in the
Securities and exchanges Registrable Securities in the Exchange Offer for
Exchange Securities.
"Person" shall mean an individual, partnership (general or limited),
corporation, limited liability company, trust or unincorporated
organization, or a government or agency or political subdivision thereof.
<PAGE> 4
3
"Private Exchange" shall have the meaning set forth in Section 2.1
hereof.
"Private Exchange Securities" shall have the meaning set forth in
Section 2.1 hereof.
"Prospectus" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus
as amended or supplemented by any prospectus supplement, including any
such prospectus supplement with respect to the terms of the offering of
any portion of the Registrable Securities covered by a Shelf Registration
Statement, and by all other amendments and supplements to a prospectus,
including post-effective amendments, and in each case including all
material incorporated by reference therein.
"Purchase Agreement" shall have the meaning set forth in the
preamble.
"Registrable Securities" shall mean the Securities and, if issued,
the Private Exchange Securities; provided, however, that Securities and,
if issued, the Private Exchange Securities, shall cease to be Registrable
Securities when (i) a Registration Statement with respect to such
Securities shall have been declared effective under the 1933 Act and such
Securities shall have been disposed of pursuant to such Registration
Statement, (ii) such Securities have been sold to the public pursuant to
Rule 144 (or any similar provision then in force, but not Rule 144A) under
the 1933 Act, (iii) such Securities shall have ceased to be outstanding or
(iv) the Exchange Offer is consummated (except in the case of Securities
purchased from the Company and continued to be held by the Initial
Purchasers).
"Registration Expenses" shall mean any and all expenses incident to
performance of or compliance by the Company with this Agreement, including
without limitation: (i) all SEC, stock exchange or National Association of
Securities Dealers, Inc. (the "NASD") registration and filing fees,
including, if applicable, the fees and expenses of any "qualified
independent underwriter" (and its counsel) that is required to be retained
by any holder of Registrable Securities in accordance with the rules and
regulations of the NASD, (ii) all fees and expenses incurred in connection
with compliance with state securities or blue sky laws and compliance with
the rules of the NASD (including reasonable fees and disbursements of
counsel for any underwriters or Holders in connection with blue sky
qualification of any of the Exchange Securities or Registrable Securities
and any filings with the NASD), (iii) all expenses of any Persons in
preparing or assisting in preparing, word processing, printing and
distributing any Registration Statement, any Prospectus, any amendments or
supplements thereto, any underwriting agreements, securities sales
agreements and other documents relating to the performance of and
compliance with this Agreement, (iv) all fees and expenses incurred in
connection with the listing, if any, of any of the Registrable Securities
on any securities exchange or exchanges, (v) all rating agency fees, (vi)
the fees and disbursements of counsel for the Company and of the
independent public accountants of the Company, including the expenses of
any special audits or "cold comfort" letters required by or incident to
such performance and
<PAGE> 5
4
compliance, (vii) the fees and expenses of the Trustee, and any escrow
agent or custodian, (viii) the reasonable fees and expenses of the Initial
Purchasers in connection with the Exchange Offer, including the reasonable
fees and expenses of counsel to the Initial Purchasers in connection
therewith, (ix) the reasonable fees and disbursements of Simpson Thacher &
Bartlett, special counsel representing the Holders of Registrable
Securities and (x) any fees and disbursements of the underwriters
customarily required to be paid by issuers or sellers of securities and
the fees and expenses of any special experts retained by the Company in
connection with any Registration Statement, but excluding underwriting
discounts and commissions and transfer taxes, if any, relating to the sale
or disposition of Registrable Securities by a Holder.
"Registration Statement" shall mean any registration statement of
the Company which covers any of the Exchange Securities or Registrable
Securities pursuant to the provisions of this Agreement, and all
amendments and supplements to any such Registration Statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"SEC" shall mean the Securities and Exchange Commission or any
successor agency or government body performing the functions currently
performed by the United States Securities and Exchange Commission.
"Shelf Registration" shall mean a registration effected pursuant to
Section 2.2 hereof.
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company pursuant to the provisions of Section 2.2 of this
Agreement which covers all of the Registrable Securities or all of the
Private Exchange Securities on an appropriate form under Rule 415 under
the 1933 Act, or any similar rule that may be adopted by the SEC, and all
amendments and supplements to such registration statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"Trustee" shall mean the trustee with respect to the Securities
under the Indenture.
2. Registration Under the 1933 Act.
2.1 Exchange Offer. The Company shall, for the benefit of the
Holders, at the Company's cost, (A) prepare and, as soon as practicable but not
later than 60 days following the Closing Date, file with the SEC an Exchange
Offer Registration Statement on an appropriate form under the 1933 Act with
respect to a proposed Exchange Offer and the issuance and delivery to the
Holders, in exchange for the Registrable Securities (other than Private Exchange
Securities), of a like principal amount of Exchange Securities, (B) use its
<PAGE> 6
5
best efforts to cause the Exchange Offer Registration Statement to be declared
effective under the 1933 Act within 150 days of the Closing Date, (C) use its
best efforts to keep the Exchange Offer Registration Statement effective until
the closing of the Exchange Offer and (D) use its best efforts to cause the
Exchange Offer to be consummated not later than 180 days following the Closing
Date. The Exchange Securities will be issued under the Indenture. Upon the
effectiveness of the Exchange Offer Registration Statement, the Company shall
promptly commence the Exchange Offer, it being the objective of such Exchange
Offer to enable each Holder eligible and electing to exchange Registrable
Securities for Exchange Securities (assuming that such Holder (a) is not an
affiliate of the Company within the meaning of Rule 405 under the 1933 Act, (b)
is not a broker-dealer tendering Registrable Securities acquired directly from
the Company for its own account, (c) acquired the Exchange Securities in the
ordinary course of such Holder's business and (d) has no arrangements or
understandings with any Person to participate in the Exchange Offer for the
purpose of distributing the Exchange Securities) to transfer such Exchange
Securities from and after their receipt without any limitations or restrictions
under the 1933 Act and under state securities or blue sky laws.
In connection with the Exchange Offer, the Company shall:
(a) mail as promptly as practicable to each Holder a copy of the
Prospectus forming part of the Exchange Offer Registration Statement, together
with an appropriate letter of transmittal and related documents;
(b) keep the Exchange Offer open for acceptance for a period of not
less than 30 calendar days after the date notice thereof is mailed to the
Holders (or longer if required by applicable law) (such period referred to
herein as the "Exchange Period");
(c) utilize the services of the Depositary for the Exchange Offer;
(d) permit Holders to withdraw tendered Registrable Securities at
any time prior to 5:00 p.m. (Eastern Time), on the last business day of the
Exchange Period, by sending to the institution specified in the notice, a
telegram, telex, facsimile transmission or letter setting forth the name of such
Holder, the principal amount of Registrable Securities delivered for exchange,
and a statement that such Holder is withdrawing such Holder's election to have
such Securities exchanged;
(e) notify each Holder that any Registrable Security not tendered
will remain outstanding and continue to accrue interest, but will not retain any
rights under this Agreement (except in the case of the Initial Purchasers and
Participating Broker-Dealers as provided herein); and
(f) otherwise comply in all respects with all applicable laws
relating to the Exchange Offer.
If, prior to consummation of the Exchange Offer, the Initial
Purchasers hold any Securities acquired by them and having the status of an
unsold allotment in the initial
<PAGE> 7
6
distribution, the Company upon the request of any Initial Purchaser shall,
simultaneously with the delivery of the Exchange Securities in the Exchange
Offer, issue and deliver to such Initial Purchaser in exchange (the "Private
Exchange") for the Securities held by such Initial Purchaser, a like principal
amount of debt securities of the Company on a senior basis, that are identical
(except that such securities shall bear appropriate transfer restrictions) to
the Exchange Securities (the "Private Exchange Securities").
The Exchange Securities and the Private Exchange Securities shall be
issued under (i) the Indenture or (ii) an indenture identical in all material
respects to the Indenture and which, in either case, has been qualified under
the Trust Indenture Act of 1939, as amended (the "TIA"), or is exempt from such
qualification and shall provide that the Exchange Securities shall not be
subject to the transfer restrictions set forth in the Indenture but that the
Private Exchange Securities shall be subject to such transfer restrictions. The
Indenture or such indenture shall provide that the Exchange Securities, the
Private Exchange Securities and the Securities shall vote and consent together
on all matters as one class and that none of the Exchange Securities, the
Private Exchange Securities or the Securities will have the right to vote or
consent as a separate class on any matter. The Private Exchange Securities shall
be of the same series as and the Company shall use all commercially reasonable
efforts to have the Private Exchange Securities bear the same CUSIP number as
the Exchange Securities. The Company shall not have any liability under this
Agreement solely as a result of such Private Exchange Securities not bearing the
same CUSIP number as the Exchange Securities.
As soon as practicable after the close of the Exchange Offer and/or
the Private Exchange, as the case may be, the Company shall:
(i) accept for exchange all Registrable Securities duly
tendered and not validly withdrawn pursuant to the Exchange Offer in
accordance with the terms of the Exchange Offer Registration Statement and
the letter of transmittal which shall be an exhibit thereto;
(ii) accept for exchange all Securities properly tendered
pursuant to the Private Exchange;
(iii) deliver to the Trustee for cancellation all Registrable
Securities so accepted for exchange; and
(iv) cause the Trustee promptly to authenticate and deliver
Exchange Securities or Private Exchange Securities, as the case may be, to
each Holder of Registrable Securities so accepted for exchange in a
principal amount equal to the principal amount of the Registrable
Securities of such Holder so accepted for exchange.
Interest on each Exchange Security and Private Exchange Security
will accrue from the last date on which interest was paid on the Registrable
Securities surrendered in exchange therefor or, if no interest has been paid on
the Registrable Securities, from the date
<PAGE> 8
7
of original issuance. The Exchange Offer and the Private Exchange shall not be
subject to any conditions, other than (i) that the Exchange Offer or the Private
Exchange, or the making of any exchange by a Holder, does not violate applicable
law or any applicable interpretation of the staff of the SEC, (ii) the due
tendering of Registrable Securities in accordance with the Exchange Offer and
the Private Exchange, (iii) that each Holder of Registrable Securities exchanged
in the Exchange Offer shall have represented that all Exchange Securities to be
received by it shall be acquired in the ordinary course of its business and that
at the time of the consummation of the Exchange Offer it shall have no
arrangement or understanding with any person to participate in the distribution
(within the meaning of the 1933 Act) of the Exchange Securities and shall have
made such other representations as may be reasonably necessary under applicable
SEC rules, regulations or interpretations to render the use of Form S-4 or other
appropriate form under the 1933 Act available and (iv) that no action or
proceeding shall have been instituted or threatened in any court or by or before
any governmental agency with respect to the Exchange Offer or the Private
Exchange which, in the Company's judgment, would reasonably be expected to
impair the ability of the Company to proceed with the Exchange Offer or the
Private Exchange. The Company shall inform the Initial Purchasers of the names
and addresses of the Holders to whom the Exchange Offer is made, and the Initial
Purchasers shall have the right to contact such Holders and otherwise facilitate
the tender of Registrable Securities in the Exchange Offer.
2.2 Shelf Registration. (i) If, because of any changes in law, SEC
rules or regulations or applicable interpretations thereof by the staff of the
SEC, the Company is not permitted to file or effect the Exchange Offer as
contemplated by Section 2.1 hereof, (ii) if for any other reason the Exchange
Offer Registration Statement is not declared effective within 150 days following
the original issue of the Registrable Securities or the Exchange Offer is not
consummated within 180 days after the original issue of the Registrable
Securities or (iii) if a Holder is not permitted to participate in the Exchange
Offer or does not receive fully tradeable Exchange Securities pursuant to the
Exchange Offer, then in the case of each of clauses (i) through (iii), the
Company, at the request of the Initial Purchasers or any such Holder referred to
in clause (iii), shall, at its cost:
(a) File with the SEC a Shelf Registration Statement, relating to
the offer and sale of the Registrable Securities by the Holders from time to
time in accordance with the methods of distribution elected by the Majority
Holders participating in the Shelf Registration and set forth in such Shelf
Registration Statement, prior to the later of (i) 60 days after the original
issue of the Registrable Securities or (ii) 30 days after such filing obligation
arises and use its best efforts to cause the Shelf Registration Statement to be
declared effective; provided, however, that if the Company has not consummated
the Exchange Offer within 180 days of the original date of issue of the
Registrable Securities, then the Company will file the Shelf Registration
Statement with the SEC on or prior to 210 days after the date of issue of the
Registrable Securities.
(b) Use its best efforts to keep the Shelf Registration Statement
continuously effective, subject to the blackout periods described in Section
3(k), in order to permit the Prospectus forming part thereof to be usable by
Holders for a period of two years from the date the Shelf Registration Statement
is declared effective by the SEC, or for such shorter
<PAGE> 9
8
period that will terminate when all Registrable Securities covered by the Shelf
Registration Statement have been sold pursuant to the Shelf Registration
Statement or cease to be outstanding or otherwise to be Registrable Securities
(the "Effectiveness Period"); provided, however, that the Effectiveness Period
in respect of the Shelf Registration Statement shall be extended to the extent
required to permit dealers to comply with the applicable prospectus delivery
requirements of Rule 174 under the 1933 Act and as otherwise provided herein.
(c) Notwithstanding any other provisions hereof, use its best
efforts to ensure that (i) any Shelf Registration Statement and any amendment
thereto and any Prospectus forming part thereof and any supplement thereto
complies in all material respects with the 1933 Act and the rules and
regulations thereunder, (ii) any Shelf Registration Statement and any amendment
thereto does not, when it becomes effective, contain an 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 and (iii) any Prospectus
forming part of any Shelf Registration Statement, and any supplement to such
Prospectus (as amended or supplemented from time to time), does not include an
untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements, in light of the circumstances under which they
were made, not misleading.
The Company shall not permit any securities other than Registrable
Securities to be included in the Shelf Registration Statement. The Company
further agrees, if necessary, to supplement or amend the Shelf Registration
Statement, as required by Section 3(b) below, and to furnish to the Holders of
Registrable Securities copies of any such supplement or amendment promptly after
its being used or filed with the SEC.
2.3 Expenses. The Company shall pay all Registration Expenses in
connection with the registration pursuant to Section 2.1 or 2.2. Each Holder
shall pay all underwriting discounts and commissions and transfer taxes, if any,
relating to the sale or disposition of such Holder's Registrable Securities
pursuant to the Shelf Registration Statement.
2.4 Effectiveness. (a) The Company will be deemed not have used its
best efforts to cause the Exchange Offer Registration Statement or the Shelf
Registration Statement, as the case may be, to become, or to remain, effective
during the requisite period if the Company voluntarily takes any action that
would, or omits to take any action which omission would, result in any such
Registration Statement not being declared effective or in the Holders of
Registrable Securities covered thereby not being able to exchange or offer and
sell such Registrable Securities during that period as and to the extent
contemplated hereby, unless such action is required by applicable law.
(b) An Exchange Offer Registration Statement pursuant to Section 2.1
hereof or a Shelf Registration Statement pursuant to Section 2.2 hereof will not
be deemed to have become effective unless it has been declared effective by the
SEC; provided, however, that if, after it has been declared effective, the
offering of Registrable Securities pursuant to an Exchange Offer Registration
Statement or a Shelf Registration Statement is interfered with by any stop
order, injunction or other order or requirement of the SEC or any other
governmental agency or court, such Registration Statement will be deemed not to
have become effective
<PAGE> 10
9
during the period of such interference, until the offering of Registrable
Securities pursuant to such Registration Statement may legally resume.
2.5 Interest. The Indenture executed in connection with the
Securities will provide that in the event that (a) the Company fails to file any
of the registration statements on or before the date specified for such filing,
(b) any of such registration statement is not declared effective by the SEC on
or prior to the date specified for such effectiveness, (c) the Exchange Offer is
required to be consummated and the Company fails to issue Exchange Securities
within 45 days of the date specified for effectiveness or (d) a registration
statement is declared effective but thereafter ceases to be effective or,
subject to the blackout periods referred to in Section 3(k), useable during the
periods specified herein (each such event referred to in clauses (a) through (d)
above, a "Registration Default"), the interest rate borne by the Securities
shall be increased ("Additional Interest") by one-quarter of one percent per
annum upon the occurrence of each Registration Default, which rate will increase
by one quarter of one percent each 90-day period that such Additional Interest
continues to accrue under any such circumstance, provided that the maximum
aggregate increase in the interest rate will in no event exceed one percent (1%)
per annum. Following the cure of all Registration Defaults the accrual of
Additional Interest will cease and the interest rate will revert to the original
rate.
If the Shelf Registration Statement is unusable by the Holders for
any reason, other than pursuant to the blackout periods referred to in Section
3(k), and the aggregate number of days in any consecutive twelve-month period
for which the Shelf Registration Statement shall not be usable exceeds 30 days
in the aggregate, then the interest rate borne by the Securities will be
increased by 0.25% per annum of the principal amount of the Securities for the
first 90-day period (or portion thereof) beginning on the 31st such date that
such Shelf Registration Statement ceases to be usable, which rate shall be
increased by an additional 0.25% per annum of the principal amount of the
Securities at the beginning of each subsequent 90-day period (or portion
thereof), provided that the maximum aggregate increase in the interest rate will
in no event exceed one percent (1%) per annum. Any amounts payable under this
paragraph shall also be deemed "Additional Interest" for purposes of this
Agreement. Upon the Shelf Registration Statement once again becoming usable, the
interest rate borne by the Securities will be reduced to the original interest
rate if the Company is otherwise in compliance with this Agreement at such time.
Additional Interest shall be computed based on the actual number of days elapsed
in each 90-day period in which the Shelf Registration Statement is unusable.
The Company shall notify the Trustee within three business days
after each and every date on which an event occurs in respect of which
Additional Interest is required to be paid (an "Event Date"). Additional
Interest shall be paid by depositing with the Trustee, in trust, for the benefit
of the Holders of Registrable Securities, on or before the applicable semiannual
interest payment date, immediately available funds in sums sufficient to pay the
Additional Interest then due. The Additional Interest due shall be payable on
each interest payment date to the record Holder of Securities entitled to
receive the interest payment to be paid on such date as set forth in the
Indenture. Each obligation to pay Additional Interest shall be deemed to accrue
from and including the day following the applicable Event Date.
<PAGE> 11
10
3. Registration Procedures.
In connection with the obligations of the Company with respect to
Registration Statements pursuant to Sections 2.1 and 2.2 hereof, the Company
shall:
(a) prepare and file with the SEC a Registration Statement, within
the relevant time period specified in Section 2, on the appropriate form under
the 1933 Act, which form (i) shall be selected by the Company, (ii) shall, in
the case of a Shelf Registration, be available for the sale of the Registrable
Securities by the selling Holders thereof, (iii) shall comply as to form in all
material respects with the requirements of the applicable form and include or
incorporate by reference all financial statements required by the SEC to be
filed therewith or incorporated by reference therein, and (iv) shall comply in
all respects with the requirements of Regulation S-T under the 1933 Act, and use
its best efforts to cause such Registration Statement to become effective and
remain effective in accordance with Section 2 hereof;
(b) prepare and file with the SEC such amendments and post-effective
amendments to each Registration Statement as may be necessary under applicable
law to keep such Registration Statement effective for the applicable period; and
cause each Prospectus to be supplemented by any required prospectus supplement,
and as so supplemented to be filed pursuant to Rule 424 (or any similar
provision then in force) under the 1933 Act and comply with the provisions of
the 1933 Act, the 1934 Act and the rules and regulations thereunder applicable
to them with respect to the disposition of all securities covered by each
Registration Statement during the applicable period in accordance with the
intended method or methods of distribution by the selling Holders thereof
(including sales by any Participating Broker-Dealer);
(c) in the case of a Shelf Registration, (i) notify each Holder of
Registrable Securities, at least five business days prior to filing, that a
Shelf Registration Statement with respect to the Registrable Securities is being
filed and advising such Holders that the distribution of Registrable Securities
will be made in accordance with the method selected by the Majority Holders
participating in the Shelf Registration; (ii) furnish to each Holder of
Registrable Securities and to each underwriter of an underwritten offering of
Registrable Securities, if any, without charge, as many copies of each
Prospectus, including each preliminary Prospectus, and any amendment or
supplement thereto and such other documents as such Holder or underwriter may
reasonably request, including financial statements and schedules and, if the
Holder so requests, all exhibits in order to facilitate the public sale or other
disposition of the Registrable Securities; and (iii) hereby consent to the use
of the Prospectus or any amendment or supplement thereto by each of the selling
Holders of Registrable Securities in connection with the offering and sale of
the Registrable Securities covered by the Prospectus or any amendment or
supplement thereto;
(d) use its best efforts to register or qualify the Registrable
Securities under all applicable state securities or "blue sky" laws of such
jurisdictions as any Holder of Registrable Securities covered by a Registration
Statement and each underwriter of an
<PAGE> 12
11
underwritten offering of Registrable Securities shall reasonably request by the
time the applicable Registration Statement is declared effective by the SEC, and
do any and all other acts and things which may be reasonably necessary or
advisable to enable each such Holder and underwriter to consummate the
disposition in each such jurisdiction of such Registrable Securities owned by
such Holder; provided, however, that the Company shall not be required to (i)
qualify as a foreign corporation or as a dealer in securities in any
jurisdiction where it would not otherwise be required to qualify but for this
Section 3(d), or (ii) take any action which would subject it to general service
of process or taxation in any such jurisdiction where it is not then so subject;
(e) notify promptly each Holder of Registrable Securities under a
Shelf Registration or any Participating Broker-Dealer who has notified the
Company that it is utilizing the Exchange Offer Registration Statement as
provided in paragraph (f) below and, if requested by such Holder or
Participating Broker-Dealer, confirm such advice in writing promptly (i) when a
Registration Statement has become effective and when any post-effective
amendments and supplements thereto become effective, (ii) of any request by the
SEC or any state securities authority for post-effective amendments and
supplements to a Registration Statement and Prospectus or for additional
information after the Registration Statement has become effective, (iii) of the
issuance by the SEC or any state securities authority of any stop order
suspending the effectiveness of a Registration Statement or the initiation of
any proceedings for that purpose, (iv) in the case of a Shelf Registration, if,
between the effective date of a Registration Statement and the closing of any
sale of Registrable Securities covered thereby, the representations and
warranties of the Company contained in any underwriting agreement, securities
sales agreement or other similar agreement, if any, relating to the offering
cease to be true and correct in all material respects, (v) of the happening of
any event or the discovery of any facts during the period a Shelf Registration
Statement is effective which makes any statement made in such Registration
Statement or the related Prospectus untrue in any material respect or which
requires the making of any changes in such Registration Statement or Prospectus
in order to make the statements therein not misleading, (vi) of the receipt by
the Company of any notification with respect to the suspension of the
qualification of the Registrable Securities or the Exchange Securities, as the
case may be, for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose and (vii) of any determination by the Company
that a post-effective amendment to such Registration Statement would be
appropriate;
(f) in the case of the Exchange Offer Registration Statement (i)
include in the Exchange Offer Registration Statement a section entitled "Plan of
Distribution" which section shall be reasonably acceptable to Merrill Lynch on
behalf of the Participating Broker-Dealers, and which shall contain a summary
statement of the positions taken or policies made by the staff of the SEC with
respect to the potential "underwriter" status of any broker-dealer that holds
Registrable Securities acquired for its own account as a result of market-making
activities or other trading activities and that will be the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) of Exchange Securities to be
received by such broker-dealer in the Exchange Offer, whether such positions or
policies have been publicly disseminated by the staff of the SEC or such
positions or policies, in the reasonable judgment of Merrill Lynch on behalf of
the Participating Broker-Dealers and its counsel, represent the prevailing
<PAGE> 13
12
views of the staff of the SEC, including a statement that any such broker-dealer
who receives Exchange Securities for Registrable Securities pursuant to the
Exchange Offer may be deemed a statutory underwriter and must deliver a
prospectus meeting the requirements of the 1933 Act in connection with any
resale of such Exchange Securities, (ii) furnish to each Participating
Broker-Dealer who has delivered to the Company the notice referred to in Section
3(e), without charge, as many copies of each Prospectus included in the Exchange
Offer Registration Statement, including any preliminary prospectus, and any
amendment or supplement thereto, as such Participating Broker-Dealer may
reasonably request, (iii) hereby consent to the use of the Prospectus forming
part of the Exchange Offer Registration Statement or any amendment or supplement
thereto, by any Person subject to the prospectus delivery requirements of the
SEC, including all Participating Broker-Dealers, in connection with the sale or
transfer of the Exchange Securities covered by the Prospectus or any amendment
or supplement thereto, and (iv) include in the transmittal letter or similar
documentation to be executed by an exchange offeree in order to participate in
the Exchange Offer (x) the following provision:
"If the exchange offeree is a broker-dealer holding Registrable
Securities acquired for its own account as a result of market-making
activities or other trading activities, it will deliver a prospectus
meeting the requirements of the 1933 Act in connection with any
resale of Exchange Securities received in respect of such
Registrable Securities pursuant to the Exchange Offer;" and
(y) a statement to the effect that by a broker-dealer making the acknowledgment
described in clause (x) and by delivering a Prospectus in connection with the
exchange of Registrable Securities, the broker-dealer will not be deemed to
admit that it is an underwriter within the meaning of the 1933 Act.
(g) (i) in the case of an Exchange Offer, furnish counsel for the
Initial Purchasers and (ii) in the case of a Shelf Registration, furnish counsel
for the Holders of Registrable Securities copies of any comment letters received
from the SEC or any other request by the SEC or any state securities authority
for amendments or supplements to a Registration Statement and Prospectus or for
additional information;
(h) make every reasonable effort to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement at the earliest
possible moment;
(i) in the case of a Shelf Registration, furnish to each Holder of
Registrable Securities, and each underwriter, if any, without charge, at least
one conformed copy of each Registration Statement and any post-effective
amendment thereto, including financial statements and schedules (without
documents incorporated therein by reference and all exhibits thereto, unless
requested);
(j) in the case of a Shelf Registration, cooperate with the selling
Holders of Registrable Securities to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold and not
bearing any restrictive legends; and
<PAGE> 14
13
enable such Registrable Securities to be in such denominations (consistent with
the provisions of the Indenture) and registered in such names as the selling
Holders or the underwriters, if any, may reasonably request at least three
business days prior to the closing of any sale of Registrable Securities;
(k) in the case of a Shelf Registration, upon the occurrence of any
event or the discovery of any facts, each as contemplated by Sections 3(e)(v)
and 3(e)(vi) hereof, as promptly as practicable after the occurrence of such an
event, use its best efforts to prepare a supplement or post-effective amendment
to the Registration Statement or the related Prospectus or any document
incorporated therein by reference or file any other required document so that,
as thereafter delivered to the purchasers of the Registrable Securities or
Participating Broker-Dealers, such Prospectus will not contain at the time of
such delivery any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading or will remain so
qualified; provided, however, that the Company shall not be required to amend or
supplement a Shelf Registration Statement or any related Prospectus or any
document incorporated therein by reference, in the event that, and for a period
not to exceed 90 days at any one time or an aggregate of 120 days in any
18-month period, if, (i) an event occurs and is continuing as a result of which
a Shelf Registration Statement would, in the Company's good faith judgment,
contain an untrue statement of a material fact or omit 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 and (ii) (a) the Company determines
in its good faith judgment that the disclosure of such event at such time would
have a material adverse effect on the business, operations or prospects of the
Company or (b) the disclosure otherwise relates to a pending material business
transaction that has not been publicly disclosed. At such time as such public
disclosure is otherwise made or the Company determines that such disclosure is
not necessary, in each case to correct any misstatement of a material fact or to
include any omitted material fact, the Company agrees promptly to notify each
Holder of such determination and to furnish each Holder such number of copies of
the Prospectus as amended or supplemented, as such Holder may reasonably
request;
(l) in the case of a Shelf Registration, a reasonable time prior to
the filing of any Registration Statement, any Prospectus, any amendment to a
Registration Statement or amendment or supplement to a Prospectus or any
document which is to be incorporated by reference into a Registration Statement
or a Prospectus after initial filing of a Registration Statement, provide copies
of such document to the Initial Purchasers on behalf of such Holders; and make
representatives of the Company as shall be reasonably requested by the Holders
of Registrable Securities, or the Initial Purchasers on behalf of such Holders,
available for discussion of such document;
(m) obtain a CUSIP number for all Exchange Securities, Private
Exchange Securities or Registrable Securities, as the case may be, not later
than the effective date of a Registration Statement, and provide the Trustee
with printed certificates for the Exchange Securities, Private Exchange
Securities or the Registrable Securities, as the case may be, in a form eligible
for deposit with the Depositary;
<PAGE> 15
14
(n) (i) cause the Indenture to be qualified under the TIA in
connection with the registration of the Exchange Securities or Registrable
Securities, as the case may be, (ii) cooperate with the Trustee and the Holders
to effect such changes to the Indenture as may be required for the Indenture to
be so qualified in accordance with the terms of the TIA and (iii) execute, and
use its best efforts to cause the Trustee to execute, all documents as may be
required to effect such changes, and all other forms and documents required to
be filed with the SEC to enable the Indenture to be so qualified in a timely
manner;
(o) in the case of a Shelf Registration, enter into agreements
(including underwriting agreements) and take all other customary and appropriate
actions in order to expedite or facilitate the disposition of such Registrable
Securities and in such connection whether or not an underwriting agreement is
entered into and whether or not the registration is an underwritten
registration:
(i) make such representations and warranties to the Holders of
such Registrable Securities and the underwriters, if any, in form,
substance and scope as are customarily made by issuers to underwriters in
similar underwritten offerings as may be reasonably requested by them;
(ii) obtain opinions of counsel to the Company and updates
thereof (which counsel and opinions (in form, scope and substance) shall
be reasonably satisfactory to the managing underwriters, if any, and the
holders of a majority in principal amount of the Registrable Securities
being sold) addressed to each selling Holder and the underwriters, if any,
covering the matters customarily covered in opinions requested in sales of
securities or underwritten offerings and such other matters as may be
reasonably requested by such Holders and underwriters;
(iii) obtain "cold comfort" letters and updates thereof from
the Company's independent certified public accountants (and, if necessary,
any other independent certified public accountants of any subsidiary of
the Company or of any business acquired by the Company for which financial
statements are, or are required to be, included in the Registration
Statement) addressed to the underwriters, if any, and use reasonable
efforts to have such letter addressed to the selling Holders of
Registrable Securities (to the extent consistent with Statement on
Auditing Standards No. 72 of the American Institute of Certified Public
Accountants), such letters to be in customary form and covering matters of
the type customarily covered in "cold comfort" letters to underwriters in
connection with similar underwritten offerings;
(iv) enter into a securities sales agreement with the Holders
and an agent of the Holders providing for, among other things, the
appointment of such agent for the selling Holders for the purpose of
soliciting purchases of Registrable Securities, which agreement shall be
in form, substance and scope customary for similar offerings;
(v) if an underwriting agreement is entered into, cause the
same to set forth indemnification provisions and procedures substantially
equivalent to the
<PAGE> 16
15
indemnification provisions and procedures set forth in Section 4 hereof
with respect to the underwriters and all other parties to be indemnified
pursuant to said Section or, at the request of any underwriters, in the
form customarily provided to such underwriters in similar types of
transactions; and
(vi) deliver such documents and certificates as may be
reasonably requested and as are customarily delivered in similar.offerings
to the Holders of a majority in principal amount of the Registrable
Securities being sold and the managing underwriters, if any.
The above shall be done at (i) the effectiveness of such Registration Statement
(and each post-effective amendment thereto) and (ii) each closing under any
underwriting or similar agreement as and to the extent required thereunder;
(p) in the case of a Shelf Registration or if a Prospectus is
required to be delivered by any Participating Broker-Dealer in the case of an
Exchange Offer, make available for inspection by representatives of the Holders
of the Registrable Securities, any underwriters participating in any disposition
pursuant to a Shelf Registration Statement, any Participating Broker-Dealer and
any counsel or accountant retained by any of the foregoing, all financial and
other records, pertinent corporate documents and properties of the Company
reasonably requested by any such persons, and cause the respective officers,
directors, employees, and any other agents of the Company to supply all
information reasonably requested by any such representative, underwriter,
special counsel or accountant in connection with a Registration Statement, and
make such representatives of the Company available for discussion of such
documents as shall be reasonably requested by the Initial Purchasers;
(q) (i) in the case of an Exchange Offer Registration Statement, a
reasonable time prior to the filing of any Exchange Offer Registration
Statement, any Prospectus forming a part thereof, any amendment to an Exchange
Offer Registration Statement or amendment or supplement to such Prospectus,
provide copies of such document to the Initial Purchasers and to counsel to the
Holders of Registrable Securities and make such changes in any such document
prior to the filing thereof as the Initial Purchasers or counsel to the Holders
of Registrable Securities may reasonably request and, except as otherwise
required by applicable law, not file any such document in a form to which the
Initial Purchasers on behalf of the Holders of Registrable Securities and
counsel to the Holders of Registrable Securities shall not have previously been
advised and furnished a copy of or to which the Initial Purchasers on behalf of
the Holders of Registrable Securities or counsel to the Holders of Registrable
Securities shall reasonably object, and make the representatives of the Company
available for discussion of such documents as shall be reasonably requested by
the Initial Purchasers; and
(ii) in the case of a Shelf Registration, a reasonable time
prior to filing any Shelf Registration Statement, any Prospectus forming a part
thereof, any amendment to such Shelf Registration Statement or amendment or
supplement to such Prospectus, provide copies of such document to the Holders of
Registrable Securities, to the Initial Purchasers, to counsel for the Holders
and to the underwriter or underwriters of an underwritten offering of
Registrable Securities, if any, make such changes in any such document prior to
the filing
<PAGE> 17
16
thereof as the Initial Purchasers, the counsel to the Holders or the underwriter
or underwriters reasonably request and not file any such document in a form to
which the Majority Holders, the Initial Purchasers on behalf of the Holders of
Registrable Securities, counsel for the Holders of Registrable Securities or any
underwriter shall not have previously been advised and furnished a copy of or to
which the Majority Holders, the Initial Purchasers on behalf of the Holders of
Registrable Securities, counsel to the Holders of Registrable Securities or any
underwriter shall reasonably object, and make the representatives of the Company
available for discussion of such document as shall be reasonably requested by
the Holders of Registrable Securities, the Initial Purchasers on behalf of such
Holders, counsel for the Holders of Registrable Securities or any underwriter;
(r) in the case of a Shelf Registration, use its best efforts to
cause all Registrable Securities to be listed on any securities exchange on
which similar debt securities issued by the Company are then listed if requested
by the Majority Holders, or if requested by the underwriter or underwriters of
an underwritten offering of Registrable Securities, if any;
(s) in the case of a Shelf Registration, use its best efforts to
cause the Registrable Securities to be rated by the appropriate rating agencies,
if so requested by the Majority Holders, or if requested by the underwriter or
underwriters of an underwritten offering of Registrable Securities, if any;
(t) otherwise comply with all applicable rules and regulations of
the SEC and make available to its security holders, as soon as reasonably
practicable, an earnings statement covering at least 12 months which shall
satisfy the provisions of Section 11(a) of the 1933 Act and Rule 158 thereunder;
(u) cooperate and assist in any filings required to be made with the
NASD and, in the case of a Shelf Registration, in the performance of any due
diligence investigation by any underwriter and its counsel (including any
"qualified independent underwriter" that is required to be retained in
accordance with the rules and regulations of the NASD); and
(v) upon consummation of an Exchange Offer or a Private Exchange,
obtain a customary opinion of counsel to the Company addressed to the Trustee
for the benefit of all Holders of Registrable Securities participating in the
Exchange Offer or Private Exchange, and which includes an opinion that (i) the
Company has duly authorized, executed and delivered the Exchange Securities
and/or Private Exchange Securities, as applicable, and the related indenture,
and (ii) each of the Exchange Securities and related indenture constitute a
legal, valid and binding obligation of the Company, enforceable against the
Company in accordance with its respective terms (with customary exceptions).
In the case of a Shelf Registration Statement, the Company may (as a
condition to such Holder's participation in the Shelf Registration) require each
Holder of Registrable Securities to furnish to the Company such information
regarding the Holder and the proposed distribution by such Holder of such
Registrable Securities as the Company may from time to time reasonably request
in writing.
<PAGE> 18
17
In the case of a Shelf Registration Statement, each Holder agrees
that, upon receipt of any notice from the Company of the happening of any event
or the discovery of any facts, each of the kind described in Section 3(e)(v)
hereof, such Holder will forthwith discontinue disposition of Registrable
Securities pursuant to a Registration Statement until such Holder's receipt of
the copies of the supplemented or amended Prospectus contemplated by Section
3(k) hereof, and, if so directed by the Company, such Holder will deliver to the
Company (at its expense) all copies in such Holder's possession, other than
permanent file copies then in such Holder's possession, of the Prospectus
covering such Registrable Securities current at the time of receipt of such
notice.
In the event that the Company fails to effect the Exchange Offer or
file any Shelf Registration Statement and maintain the effectiveness of any
Shelf Registration Statement as provided herein, the Company shall not file any
Registration Statement with respect to any securities (within the meaning of
Section 2(l) of the 1933 Act) of the Company other than Registrable Securities.
If any of the Registrable Securities covered by any Shelf
Registration Statement are to be sold in an underwritten offering, the
underwriter or underwriters and manager or managers that will manage such
offering will be selected by the Majority Holders of such Registrable Securities
included in such offering and shall be acceptable to the Company. No Holder of
Registrable Securities may participate in any underwritten registration
hereunder unless such Holder (a) agrees to sell such Holder's Registrable
Securities on the basis provided in any underwriting arrangements approved by
the persons entitled hereunder to approve such arrangements and (b) completes
and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of such underwriting
arrangements.
4. Indemnification; Contribution.
(a) The Company agrees to indemnify and hold harmless the Initial
Purchasers, each Holder, each Participating Broker-Dealer, each Person who
participates as an underwriter (any such Person being an "Underwriter") and each
Person, if any, who controls any Holder or Underwriter within the meaning of
Section 15 of the 1933 Act or Section 20 of the 1934 Act as follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of any untrue statement or
alleged untrue statement of a material fact contained in any Registration
Statement (or any amendment or supplement thereto) pursuant to which
Exchange Securities or Registrable Securities were registered under the
1933 Act, including all documents incorporated therein by reference, or
the omission or alleged omission therefrom of a material fact required to
be stated therein or necessary to make the statements therein not
misleading, or arising out of any untrue statement or alleged untrue
statement of a material fact contained in any Prospectus (or any amendment
or supplement thereto) or the omission or alleged omission therefrom of a
material fact necessary in order to
<PAGE> 19
18
make the statements therein, in the light of the circumstances under which
they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding
by any governmental agency or body, commenced or threatened, or of any
claim whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission; provided that (subject to
Section 4(d) below) any such settlement is effected with the written
consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by any indemnified
party), reasonably incurred in investigating, preparing or defending
against any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such expense
is not paid under subparagraph (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss,
liability, claim, damage or expense to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by the
Holder or Underwriter expressly for use in a Registration Statement (or any
amendment thereto) or any Prospectus (or any amendment or supplement thereto);
and provided further that the Company will not be liable to an Underwriter with
respect to any Prospectus to the extent that the Company shall sustain the
burden of proving that any such loss, liability, claim, damage or expense
resulted from the fact that such Underwriter, in contravention of a requirement
of this Agreement or applicable law, sold Securities to a person to whom such
Underwriter failed to send or give a copy of the Prospectus, as then amended or
supplemented if (i) the Company has previously furnished copies thereof
(sufficiently in advance of such sale) to the Underwriter and the loss,
liability, claim, damage or expenses of such Underwriter resulted from an untrue
statement or omission of a material fact contained in or omitted from a
Prospectus which was later corrected in a Prospectus and such Prospectus was
required by law to be delivered at or prior to the written confirmation of sale
to such person and (ii) such failure to give or send such Prospectus to the
party or parties asserting such loss, liability, claim, damage or expense would
have constituted the sole defense to the claim asserted by such person.
(b) Each Holder severally, but not jointly, agrees to indemnify and
hold harmless the Company, the Initial Purchasers, each Underwriter and the
other selling Holders, and each of their respective directors and officers, and
each Person, if any, who controls the Company, the Initial Purchasers, any
Underwriter or any other selling Holder within the meaning of Section 15 of the
1933 Act or Section 20 of the 1934 Act, against any and all loss, liability,
claim, damage and expense described in the indemnity contained in Section 4(a)
hereof, as incurred, but only with respect to untrue statements or omissions, or
alleged untrue statements or omissions, made in the Shelf Registration
<PAGE> 20
19
Statement (or any amendment thereto) or any Prospectus included therein (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information with respect to such Holder furnished to the Company by such Holder
expressly for use in the Shelf Registration Statement (or any amendment thereto)
or such Prospectus (or any amendment or supplement thereto); provided, however,
that no
such Holder shall be liable for any claims hereunder in excess of the amount of
net proceeds received by such Holder from the sale of Registrable Securities
pursuant to such Shelf Registration Statement.
(c) Each indemnified party shall give notice as promptly as
reasonably practicable to each indemnifying party of any action or proceeding
commenced against it in respect of which indemnity may be sought hereunder, but
failure so to notify an indemnifying party shall not relieve such indemnifying
party from any liability hereunder to the extent it is not materially prejudiced
as a result thereof and in any event shall not relieve it from any liability
which it may have otherwise than on account of this indemnity agreement. An
indemnifying party may participate at its own expense in the defense of such
action; provided, however, that counsel to the indemnifying party shall not
(except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying party or parties be liable
for the fees and expenses of more than one counsel (in addition to any local
counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 4 (whether or not the indemnified parties are actual or
potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(d) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 4(a)(ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
(e) If the indemnification provided for in this Section 4 is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
therein, then each indemnifying party shall
<PAGE> 21
20
contribute to the aggregate amount of such losses, liabilities, claims, damages
and expenses incurred by such indemnified party, as incurred, in such proportion
as is appropriate to reflect the relative fault of the Company on the one hand
and the Holders and the Initial Purchasers on the other hand in connection with
the statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative fault of the Company on the one hand and the Holders
and the Initial Purchasers on the other hand shall be determined by reference
to, among other things, whether any such untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company, the Holders or the Initial Purchasers
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company, the Holders and the Initial Purchasers agree that it
would not be just and equitable if contribution pursuant to this Section 4 were
determined by pro rata allocation (even if the Initial Purchasers were treated
as one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to above in this
Section 4. The aggregate amount of losses, liabilities, claims, damages and
expenses incurred by an indemnified party and referred to above in this Section
4 shall be deemed to include any legal or other expenses reasonably incurred by
such indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever based upon any such
untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 4, no Initial
Purchaser shall be required to contribute any amount in excess of the amount by
which the total price at which the Securities sold by it were offered exceeds
the amount of any damages which such Initial Purchaser 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 1933 Act) shall be entitled to contribution from any
Person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 4, each Person, if any, who controls an
Initial Purchaser or Holder within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act shall have the same rights to contribution as such
Initial Purchaser or Holder, and each director of the Company, and each Person,
if any, who controls the Company within the meaning of Section 15 of the 1933
Act or Section 20 of the 1934 Act shall have the same rights to contribution as
the Company. The Initial Purchasers' respective obligations to contribute
pursuant to this Section 7 are several in proportion to the principal amount of
Securities set forth opposite their respective names in Schedule A to the
Purchase Agreement and not joint.
<PAGE> 22
21
5. Miscellaneous.
5.1 Rule 144 and Rule 144A. For so long as the Company is subject to
the reporting requirements of Section 13 or 15 of the 1934 Act, the Company
covenants that it will file the reports required to be filed by it under the
1933 Act and Section 13(a) or 15(d) of the 1934 Act and the rules and
regulations adopted by the SEC thereunder. If the Company ceases to be so
required to file such reports, the Company covenants that it will upon the
request of any Holder of Registrable Securities (a) make publicly available such
information as is necessary to permit sales pursuant to Rule 144 under the 1933
Act, (b) deliver such information to a prospective purchaser as is necessary to
permit sales pursuant to Rule 144A under the 1933 Act and it will take such
further action as any Holder of Registrable Securities may reasonably request,
and (c) take such further action that is reasonable in the circumstances, in
each case, to the extent required from time to time to enable such Holder to
sell its Registrable Securities without registration under the 1933 Act within
the limitation of the exemptions provided by (i) Rule 144 under the 1933 Act, as
such Rule may be amended from time to time, (ii) Rule 144A under the 1933 Act,
as such Rule may be amended from time to time, or (iii) any similar rules or
regulations hereafter adopted by the SEC. Upon the request of any Holder of
Registrable Securities, the Company will deliver to such Holder a written
statement as to whether it has complied with such requirements.
5.2 No Inconsistent Agreements. The Company has not entered into and
the Company will not after the date of this Agreement enter into any agreement
which is inconsistent with the rights granted to the Holders of Registrable
Securities in this Agreement or otherwise conflicts with the provisions hereof.
The rights granted to the Holders hereunder do not and will not for the term of
this Agreement in any way conflict with the rights granted to the holders of the
Company's other issued and outstanding securities under any such agreements.
5.3 Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of Holders
of at least a majority in aggregate principal amount of the outstanding
Registrable Securities affected by such amendment, modification, supplement,
waiver or departure.
5.4 Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery, registered
first-class mail, telex, telecopier, or any courier guaranteeing overnight
delivery (a) if to a Holder, at the most current address given by such Holder to
the Company by means of a notice given in accordance with the provisions of this
Section 5.4, which address initially is the address set forth in the Purchase
Agreement with respect to the Initial Purchasers; and (b) if to the Company,
initially at the Company's address set forth in the Purchase Agreement, and
thereafter at such other address of which notice is given in accordance with the
provisions of this Section 5.4.
<PAGE> 23
22
All such notices and communications shall be deemed to have been
duly given: at the time delivered by hand, if personally delivered; two business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt is acknowledged, if telecopied; and on
the next business day if timely delivered to an air courier guaranteeing
overnight delivery.
Copies of all such notices, demands, or other communications shall
be concurrently delivered by the person giving the same to the Trustee under the
Indenture, at the address specified in such Indenture.
5.5 Successor and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors, assigns and transferees of each of the
parties, including, without limitation and without the need for an express
assignment, subsequent Holders; provided that nothing herein shall be deemed to
permit any assignment, transfer or other disposition of Registrable Securities
in violation of the terms of the Purchase Agreement or the Indenture. If any
transferee of any Holder shall acquire Registrable Securities, in any manner,
whether by operation of law or otherwise, such Registrable Securities shall be
held subject to all of the terms of this Agreement, and by taking and holding
such Registrable Securities such person shall be conclusively deemed to have
agreed to be bound by and to perform all of the terms and provisions of this
Agreement, including the restrictions on resale set forth in this Agreement and,
if applicable, the Purchase Agreement, and such person shall be entitled to
receive the benefits hereof.
5.6 Third Party Beneficiaries. The Initial Purchasers (even if the
Initial Purchasers are not Holders of Registrable Securities) shall be third
party beneficiaries to the agreements made hereunder between the Company, on the
one hand, and the Holders, on the other hand, and shall have the right to
enforce such agreements directly to the extent they deem such enforcement
necessary or advisable to protect their rights or the rights of Holders
hereunder. Each Holder of Registrable Securities shall be a third party
beneficiary to the agreements made hereunder between the Company, on the one
hand, and the Initial Purchasers, on the other hand, and shall have the right to
enforce such agreements directly to the extent it deems such enforcement
necessary or advisable to protect its rights hereunder.
5.7 Specific Enforcement. Without limiting the remedies available to
the Initial Purchasers and the Holders, the Company acknowledges that any
failure by the Company to comply with its obligations under Sections 2.1 through
2.4 hereof may result in material irreparable injury to the Initial Purchasers
or the Holders for which there is no adequate remedy at law, that it would not
be possible to measure damages for such injuries precisely and that, in the
event of any such failure, the Initial Purchasers or any Holder may obtain such
relief as may be required to specifically enforce the Company's obligations
under Sections 2.1 through 2.4 hereof.
5.8 Restriction on Resales. Until the expiration of two years after
the original issuance of the Securities, the Company will not, and will cause
its "affiliates" (as such term is defined in Rule 144(a)(1) under the 1933 Act)
not to, resell any Securities which are
<PAGE> 24
23
"restricted securities" (as such term is defined under Rule 144(a)(3) under the
1933 Act) that have been reacquired by any of them and shall immediately upon
any purchase of any such Securities submit such Securities to the Trustee for
cancellation.
5.9 Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
5.10 Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
5.11 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK WITHOUT REGARD TO
THE PRINCIPLES OF CONFLICT OF LAWS THEREOF.
5.12 Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
<PAGE> 25
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
CBS CORPORATION
By: /s/ Fredric C. Reynolds
-------------------------------------
Name: Fredric C. Reynolds
Title: Executive Vice President
Confirmed and accepted as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
CHASE SECURITIES INC.
J.P. MORGAN SECURITIES INC.
BY: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ Lisa Clark
-----------------------------------
Name: Lisa Clark
Title: Authorized Signatory
<PAGE> 1
Exhibit 5(a)
CBS CORPORATION
Louis J. Briskman
Executive Vice President and
General Counsel
11 Stanwiz Street
Pittsburgh, PA 15222-1384
Phone: 412-642-3966
July 7, 1998
Securities and Exchange Commission
Judiciary Plaza
450 Fifth Street, N.W.
Washington, D.C. 20549
Ladies and Gentlemen:
As Executive Vice President and General Counsel of CBS Corporation, a
Pennsylvania corporation (the "Company"), I or lawyers who report to me or other
counsel have acted as counsel to the Company in connection with the preparation
and filing of a Registration Statement on Form S-4 (the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act"),
relating to $500,000,000 aggregate principal amount of 7.15% Senior Notes due
2005 (the "Exchange Notes") of the Company.
In so acting, I am in a position that has provided me with an opportunity to
examine, either personally or directly through lawyers who report to me or
through other counsel, originals or copies, certified or otherwise identified to
my satisfaction, of the Registration Statement, the Prospectus that is a part of
the Registration Statement (the "Prospectus"), the Indenture, dated as of May
20, 1998 by and between the Company and Citibank, N.A., as trustee (the
"Trustee"), pursuant to which the Exchange Notes will be issued (the
"Indenture"), the form of Exchange Note included as Exhibit 4(c) to the
Registration Statement, and such corporate records, agreements, documents and
other instruments, and such certificates or comparable documents of public
officials and of officers and representatives of the Company as I have deemed
relevant and necessary as a basis for the opinions hereinafter set forth.
Additionally, I have, either personally or directly through lawyers who report
to me or through other counsel, made such inquiries of such officers and
representatives of the Company as I have deemed relevant and necessary.
In such examination, I have assumed the genuineness of all signatures, the legal
capacity of natural persons, the authenticity of all documents submitted to me
as originals, the conformity to original documents of all documents submitted to
me as certified, conformed or photostatic copies and the
<PAGE> 2
Securities and Exchange Commission
July 7, 1998
Page 2
authenticity of the originals of such latter documents. As to all questions of
fact material to this opinion that have not been independently established, I
have relied upon certificates or comparable documents of officers and
representatives of the Company.] The opinions set forth below are also based on
the assumption that the Registration Statement, as finally amended (including
any necessary post-effective amendments), has become effective under the
Securities Act and that the Indenture has been qualified under the Trust
Indenture Act of 1939, as amended, and has been duly executed and delivered by
the Trustee.
Based on the foregoing, and subject to the qualifications stated herein, I am of
the opinion that the Exchange Notes are duly authorized, and when duly executed
on behalf of the Company, and assuming authentication, issuance and delivery by
the Trustee under the Indenture in accordance with the terms of the Indenture
and as contemplated by the Registration Statement, will be validly issued and
will constitute legal and binding obligations of the Company, enforceable
against it in accordance with their terms and the terms of the Indenture,
subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors' rights and
remedies generally and subject, as to enforceability, to general principles of
equity, including principles of commercial reasonableness, good faith and fair
dealing (regardless of whether enforcement is sought in a proceeding in equity
or at law) and subject to the qualification that the waiver of rights under any
usury laws contained in the Indenture may be unenforceable.
The opinions herein are limited to the laws of the Commonwealth of Pennsylvania
and the federal laws of the United States, and I express no opinion as to the
effect on the matters covered by this opinion of the laws of any other
jurisdiction.
I hereby consent to the use of this opinion as an exhibit to the Registration
Statement. I also consent to any and all references to this opinion under the
caption "Legal Matters" in the Prospectus.
Very truly yours,
/s/Louis J. Briskman
Louis J. Briskman
Executive Vice President
and General Counsel
<PAGE> 1
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
Exhibit 5(b)
July 7, 1998
CBS Corporation
200 Park Avenue
New York, New York 10166
Ladies and Gentlemen:
We have acted as special counsel to CBS Corporation, a
Pennsylvania corporation (the "Company"), in connection with the preparation and
filing of a Registration Statement on Form S-4 (the "Registration Statement")
under the Securities Act of 1933, as amended (the "Securities Act"), relating to
$500,000,000 aggregate principal amount of 7.15% Senior Notes due 2005 (the
"Exchange Notes") of the Company.
In so acting, we have examined originals or copies, certified
or otherwise identified to our satisfaction, of the Registration Statement, the
Prospectus that is a part of the Registration Statement (the "Prospectus"), the
Indenture, dated as of May 20, 1998 by and between the Company and Citibank,
N.A., as trustee (the "Trustee"), pursuant to which the Exchange Notes will be
issued (the "Indenture"), the form of Exchange Note included as Exhibit 4(c) to
the Registration Statement, and such corporate records, agreements, documents
and other instruments, and such certificates or comparable documents of public
officials and of officers and representatives of the Company, and have made such
inquiries of such officers and representatives of the Company as we have deemed
relevant and necessary as a basis for the opinions hereinafter set forth.
In such examination, we have assumed the genuineness of all
signatures, the legal capacity of natural persons, the authenticity of all
documents submitted to us as originals, the conformity to original documents of
all documents submitted to us as certified, conformed or photostatic copies and
the authenticity of the originals of such latter documents. As to all questions
of fact material to this opinion that have not been independently established,
we have relied upon certificates or comparable documents of officers and
representatives of the Company. The opinions set forth below are also based on
the
<PAGE> 2
CBS Corporation
July 7, 1998
Page 2
assumption that the Registration Statement, as finally amended (including any
necessary post-effective amendments), has become effective under the Securities
Act and that the Indenture has been qualified under the Trust Indenture Act of
1939, as amended, and has been duly executed and delivered by the Trustee. We
have also assumed as to the Company (i) its due incorporation and valid
existence, (ii) that the Company has the requisite corporate power and authority
to enter into and perform its obligations under the Indenture and the Exchange
Notes and (iii) the due authorization, execution and delivery by the Company of
the Indenture and the Exchange Notes, all of which are matters of Pennsylvania
law and which are included in the opinion of even date herewith of Louis J.
Briskman, Esq., Executive Vice President and General Counsel of the Company, a
copy of which has been filed as an exhibit to the Registration Statement.
Based on the foregoing, and subject to the qualifications
stated herein, we are of the opinion that the Exchange Notes, when authenticated
by the Trustee under the Indenture and issued and delivered in accordance with
the terms of the Indenture and as contemplated by the Registration Statement,
will be validly issued and will constitute legal and binding obligations of the
Company, enforceable against it in accordance with their terms and the terms of
the Indenture, subject to applicable bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and similar laws affecting creditors'
rights and remedies generally and subject, as to enforceability, to general
principles of equity, including principles of commercial reasonableness, good
faith and fair dealing (regardless of whether enforcement is sought in a
proceeding in equity or at law) and subject to the qualification that the waiver
of rights under any usury laws contained in the Indenture may be unenforceable.
The foregoing opinion is limited to the laws of the State of
New York and the federal laws of the United States, and we express no opinion as
to the effect on the matters covered by this opinion of the laws of any other
jurisdiction.
We hereby consent to the use of this letter as an exhibit to
the Registration Statement. We also consent to any and all references to our
firm under the caption "Legal Matters" in the Prospectus.
Very truly yours,
/s/ Weil, Gotshal & Manges LLP
<PAGE> 1
Exhibit 12
CBS CORPORATION
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
Three Months ended
March 31, Year Ended December 31,
1998 1997 1996 1995 1994 1993
<S> <C> <C> <C> <C> <C> <C>
($ in millions)
Income (loss) before income taxes and
minority interest $ 66 $ (59) $(292) $ 128 $ (6) $ 26
Less: Equity in income (loss) or
50 percent or less owned
affiliates -- 9 10 15 (3) (2)
Add: Fixed charges 82 410 421 188 30 59
----- ----- ----- ----- ----- -----
Earnings as adjusted $ 148 $ 342 $ 119 $ 301 $ 27 $ 87
----- ----- ----- ----- ----- -----
Fixed charges:
Interest expense $ 75 $ 386 $ 401 $ 184 $ 26 $ 55
Rental expense 7 24 20 4 4 4
----- ----- ----- ----- ----- -----
Total fixed charges $ 82 $ 410 $ 421 $ 188 $ 30 $ 59
----- ----- ----- ----- ----- -----
Ratio of earnings to fixed charges 1.8x (a) (a) 1.6x (a) 1.5x
----- ----- ----- ----- ----- -----
</TABLE>
(a) Additional income before income taxes and minority interest necessary
to attain a ratio of 1.00x for 1997, 1996 and 1994 would be $68
million, $302 million, and $3 million, respectively.
<PAGE> 1
Exhibit 23(a)
CONSENT OF INDEPENDENT AUDITORS
The Board of Directors
CBS Corporation:
We consent to the use of our reports dated January 28, 1998, appearing on pages
24 and 55 of CBS Corporation's Form 10-K for the year ended December 31, 1997,
incorporated by reference in this Registration Statement on Form S-4 and to the
reference to our firm under the heading "Experts" in this Registration
Statement.
/s/ KPMG Peat Marwick LLP
July 7, 1998
New York, New York
<PAGE> 1
Exhibit 23(b)
Consent of Independent Auditors
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-4 of CBS Corporation
of our report dated February 12, 1996 except for the restatements discussed in
notes 1 and 7, for which the dates are March 31, 1996, November 13, 1996 and
September 30, 1997 appearing on page 25 of CBS Corporation's Annual Report on
Form 10-K for the year ended December 31, 1997. We also consent to the
incorporation by reference of our report on the Financial Statement Schedule,
which appears on page 56 of such Annual Report on Form 10-K. We also consent to
the reference to us under the heading "Experts" in such Registration Statement.
/s/ PricewaterhouseCoopers
Pittsburgh, Pennsylvania
July 7, 1998
<PAGE> 1
EXHIBIT 25
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------------------
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an application to determine eligibility of a Trustee
pursuant to Section 305(b)(2) ____
------------------------
CITIBANK, N.A.
(Exact name of trustee as specified in its charter)
13-5266470
(I.R.S. employer
identification no.)
399 Park Avenue, New York, New York 10043
(Address of principal executive office) (Zip Code)
-----------------------
CBS CORPORATION
(Exact name of obligor as specified in its charter)
Pennsylvania 25-0877540
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
51 West 52nd Street
New York, NY 10019
(Address of principal executive offices) (Zip Code)
-------------------------
7.15% Senior Notes due 2005
(Title of the indenture securities)
<PAGE> 2
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to which
it is subject.
<TABLE>
<CAPTION>
Name Address
---- -------
<S> <C>
Comptroller of the Currency Washington, D.C.
Federal Reserve Bank of New York New York, NY
33 Liberty Street
New York, NY
Federal Deposit Insurance Corporation Washington, D.C.
</TABLE>
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
Item 2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None.
Item 16. List of Exhibits.
List below all exhibits filed as a part of this Statement of
Eligibility.
Exhibits identified in parentheses below, on file with the
Commission, are incorporated herein by reference as exhibits hereto.
Exhibit 1 - Copy of Articles of Association of the Trustee, as now
in effect. (Exhibit 1 to T-1 to Registration Statement No. 2-79983)
Exhibit 2 - Copy of certificate of authority of the Trustee to
commence business. (Exhibit 2 to T-1 to Registration Statement No.
2-29577).
Exhibit 3 - Copy of authorization of the Trustee to exercise
corporate trust powers. (Exhibit 3 to T-1 to Registration Statement
No. 2-55519)
<PAGE> 3
Exhibit 6 - The consent of the Trustee required by Section 321(b) of
the Trust Indenture Act of 1939. (Exhibit 6 to T-1 to Registration
Statement No. 33-19227.)
Exhibit 7 - Copy of the latest Report of Condition of Citibank, N.A.
(as of March 31, 1998 - attached)
Exhibit 8 - Not applicable.
Exhibit 9 - Not applicable.
------------------
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, Citibank, N.A., a national banking association organized and existing
under the laws of the United States of America, has duly caused this statement
of eligibility to be signed on its behalf by the undersigned, thereunto duly
authorized, all in The City of New York and State of New York, on the 26th day
of May 1998.
CITIBANK, N.A.
By /s/ Wafaa Orfy
----------------------------------------
Wafaa Orfy
Senior Trust Officer
<PAGE> 4
Exhibit 7
Charter No. 1461
Comptroller of the Currency
Northeastern District
REPORT OF CONDITION
CONSOLIDATING
DOMESTIC AND FOREIGN
SUBSIDIARIES OF
Citibank, N.A.
of New York in the State of New York, at the close of business on March 31,
1998, published in response to call made by Comptroller of the Currency, under
Title 12, United States Code, Section 161. Charter Number 1461 Comptroller of
the Currency Northeastern District.
<TABLE>
<CAPTION>
ASSETS
Thousands
of dollars
<S> <C>
Cash and balances due from depository
institutions:
Noninterest-bearing balances
and currency and coin ....................................... $ 6,890,000
Interest-bearing balances ..................................... 14,848,000
Held-to-maturity securities ................................... 0
Available-for-sale securities ................................. 31,464,000
Federal funds sold and securities
purchased under agreements to resell ........................ 19,345,000
Loans and lease financing
receivables:
Loans and Leases, net of
unearned income ............................................. $ 159,106,000
LESS: Allowance for loan and
lease losses ................................................ 4,259,000
Loans and leases, net of unearned
income, allowance, and reserve ............................... 154,847,000
Trading assets ................................................ 36,633,000
Premises and fixed assets (including
capitalized leases) .......................................... 3,376,000
Other real estate owned ....................................... 485,000
Investments in unconsolidated
subsidiaries and associated companies ........................ 1,386,000
Customers' liability to this bank
on acceptances outstanding ................................... 1,824,000
Intangible assets ............................................. 160,000
Other assets .................................................. 9,670,000
TOTAL ASSETS .................................................. $ 280,928,000
LIABILITIES
Deposits:
In domestic offices .......................................... $ 37,884,000
Noninterest-bearing .......................................... $ 12,822,000
Interest-bearing ............................................. 25,062,000
In foreign offices, Edge and
Agreement subsidiaries, and IBFs ............................. 155,776,000
Noninterest-bearing .......................................... 9,878,000
Interest-bearing ............................................. 145,898,000
Federal funds purchased and
securities sold under agreements to
repurchase ................................................... 7,429,000
Trading liabilities ........................................... 29,266,000
Other borrowed money (includes
mortgage indebtedness and obligations
under capitalized leases):
With a remaining maturity of one year or less ................ 9,518,000
With a remaining maturity of more than one
year through three years ..................................... 2,340,000
With a remaining maturity of more than three
years ........................................................ 898,000
Bank's liability on acceptances executed
and outstanding .............................................. 1,992,000
Subordinated notes and debentures ............................. 5,600,000
Other liabilities ............................................. 12,507,000
TOTAL LIABILITIES ............................................. $ 263,210,000
EQUITY CAPITAL
Perpetual preferred stock and related surplus ................. 0
Common stock .................................................. $ 751,000
Surplus ....................................................... 7,604,000
Undivided profits and capital reserves ........................ 9,617,000
Net unrealized holding gains (losses)
on available-for-sale securities ............................. 443,000
Cumulative foreign currency translation adjustments ........... (697,000)
TOTAL EQUITY CAPITAL .......................................... $ 17,718,000
TOTAL LIABILITIES, LIMITED-LIFE PREFERRED STOCK,
AND EQUITY CAPITAL ........................................... $ 280,928,000
</TABLE>
I, Roger W. Trupin, Controller of the above-named bank do hereby declare that
this Report of Condition is true and correct to the best of my knowledge and
belief.
ROGER W. TRUPIN
CONTROLLER
We, the undersigned directors, attest to the correctness of this Report of
Condition. We declare that it has been examined by us, and to the best of our
knowledge and belief has been prepared in conformance with the instructions and
is true and correct.
PAUL J. COLLINS
JOHN S. REED
WILLIAM R. RHODES
DIRECTORS
<PAGE> 1
LETTER OF TRANSMITTAL
CBS CORPORATION
TO TENDER FOR EXCHANGE 7.15% SENIOR NOTES DUE 2005
PURSUANT TO THE PROSPECTUS DATED , 1998
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON , 1998 UNLESS EXTENDED (THE "EXPIRATION DATE").
PLEASE READ CAREFULLY THE ATTACHED INSTRUCTIONS
IF YOU DESIRE TO ACCEPT THE EXCHANGE OFFER, THIS LETTER OF TRANSMITTAL
SHOULD BE COMPLETED, SIGNED, AND SUBMITTED TO THE EXCHANGE AGENT:
CITIBANK, N.A.
<TABLE>
<S> <C> <C>
By Mail: By Overnight Delivery: By Hand:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
c/o Citicorp Data Distributions, Inc. c/o Citicorp Data Distributions, Inc. Corporate Trust Window
P.O. Box 7072 404 Sette Drive 111 Wall Street, 5th Floor
Paramus, New Jersey 07653 Paramus, New Jersey 07652 New York, New York 10043
Facsimile for Eligible Institutions:
(201) 262-3240
Facsimile Confirmation Only:
(800) 422-2077
For Information:
(800) 422-2077
</TABLE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS, OR TRANSMISSION VIA
FACSIMILE TO A NUMBER, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID
DELIVERY. FOR ANY QUESTIONS REGARDING THIS LETTER OF TRANSMITTAL OR FOR ANY
ADDITIONAL INFORMATION, YOU MAY CONTACT THE EXCHANGE AGENT.
The undersigned hereby acknowledges receipt of the Prospectus dated
, 1998 (as it may be supplemented and amended from time to time, the
"Prospectus") of CBS Corporation, a Pennsylvania corporation ("Company"), and
this Letter of Transmittal (the "Letter of Transmittal"), that together
constitute the Company's offer (the "Exchange Offer") to exchange $1,000 in
principal amount of its 7.15% Senior Notes due 2005 (the "Exchange Notes"),
which have been registered under the Securities Act of 1933, as amended (the
"Securities Act"), pursuant to a Registration Statement, for each $1,000 in
principal amount of its outstanding 7.15% Senior Notes due 2005 (the "Notes"),
of which $500,000,000 aggregate principal amount is outstanding. Capitalized
terms used but not defined herein have the meanings ascribed to them in the
Prospectus.
The undersigned hereby tenders the Notes described in Box 1 below (the
"Tendered Notes") pursuant to the terms and conditions described in the
Prospectus and this Letter of Transmittal. The undersigned is the registered
owner of all the Tendered Notes and the undersigned represents that it has
received from each beneficial owner of the Tendered Notes ("Beneficial Owners")
a duly completed and executed form of "Instruction to Registered Holder and/or
Book-Entry Transfer Facility Participant from Beneficial Owner" accompanying
this Letter of Transmittal, instructing the undersigned to take the action
described in this Letter of Transmittal.
Subject to, and effective upon, the acceptance for exchange of the Tendered
Notes, the undersigned hereby exchanges, assigns and transfers to, or upon the
order of, the Company all right, title, and interest in, to and under the
Tendered Notes.
<PAGE> 2
Please issue the Exchange Notes exchanged for Tendered Notes in the name(s)
of the undersigned. Similarly, unless otherwise indicated under "SPECIAL
DELIVERY INSTRUCTIONS" below (see Box 3), please send or cause to be sent the
certificates for the Exchange Notes (and accompanying documents, as appropriate)
to the undersigned at the address shown below in Box 1.
The undersigned hereby irrevocably constitutes and appoints the Exchange
Agent as the true and lawful agent and attorney in fact of the undersigned with
respect to the Tendered Notes, with full power of substitution (such power of
attorney being deemed to be an irrevocable power coupled with an interest), to
(i) deliver the Tendered Notes to the Company or cause ownership of the Tendered
Notes to be transferred to, or upon the order of, the Company, on the books of
the registrar for the Notes and deliver all accompanying evidences of transfer
and authenticity to, or upon the order of, the Company upon receipt by the
Exchange Agent, as the undersigned's agent, of the Exchange Notes to which the
undersigned is entitled upon acceptance by the Company of the Tendered Notes
pursuant to the Exchange Offer, and (ii) receive all benefits and otherwise
exercise all rights of beneficial ownership of the Tendered Notes, all in
accordance with the terms of the Exchange Offer.
The undersigned understands that tenders of Notes pursuant to the
procedures described under the caption "The Exchange Offer" in the Prospectus
and in the instructions hereto will constitute a binding agreement between the
undersigned and the Company upon the terms and subject to the conditions of the
Exchange Offer, subject only to withdrawal of such tenders on the terms set
forth in the Prospectus under the caption "The Exchange Offer -- Withdrawal of
Tenders." All authority herein conferred or agreed to be conferred shall survive
the death or incapacity of the undersigned and any Beneficial Owner(s), and
every obligation of the undersigned or any Beneficial Owner(s) hereunder shall
be binding upon the heirs, representatives, successors, and assigns of the
undersigned and such Beneficial Owner(s).
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, exchange, assign, and transfer the Tendered
Notes and that the Company will acquire good and unencumbered title thereto,
free and clear of all liens, restrictions, charges, encumbrances, and adverse
claims when the Tendered Notes are acquired by the Company as contemplated
herein. The undersigned and each Beneficial Owner will, upon request, execute
and deliver any additional documents reasonably requested by the Company or the
Exchange Agent as necessary or desirable to complete and give effect to the
transactions contemplated hereby.
The undersigned hereby represents and warrants that the information set
forth in Box 2 is true and correct.
By accepting the Exchange Offer, the undersigned hereby represents and
warrants that (i) the Exchange Notes to be acquired by the undersigned and any
Beneficial Owner(s) in connection with the Exchange Offer are being acquired by
the undersigned and any Beneficial Owner(s) in the ordinary course of business
of the undersigned and any Beneficial Owner(s), (ii) the undersigned and each
Beneficial Owner are not participating, do not intend to participate, and have
no arrangement or understanding with any person to participate, in the
distribution of the Exchange Notes, (iii) except as otherwise disclosed in
writing herewith, neither the undersigned nor any Beneficial Owner is an
"affiliate," as defined in Rule 405 under the Securities Act, of the Company,
and (iv) the undersigned and each Beneficial Owner acknowledge and agree that
any person participating in the Exchange Offer with the intention or for the
purpose of distributing the Exchange Notes must comply with the registration and
prospectus delivery requirements of the Securities Act of 1933, as amended
(together with the rules and regulations promulgated thereunder, the "Securities
Act") in connection with a secondary resale of the Exchange Notes acquired by
such person and cannot rely on the position of the Staff of the Securities and
Exchange Commission (the "Commission") set forth in the no-action letters that
are discussed in the section of the Prospectus entitled "The Exchange Offer." In
addition, by accepting the Exchange Offer, the undersigned hereby (i) represents
and warrants that, if the undersigned or any Beneficial Owner of the Notes is a
Participating Broker-Dealer, such Participating Broker-Dealer acquired the Notes
for its own account as a result of market-making activities or other trading
activities and has not entered into any arrangement or understanding with the
Company or any "affiliate" of the Company (within the meaning of Rule 405 under
the Securities Act) to distribute the Exchange Notes to be received in
2
<PAGE> 3
the Exchange Offer, and (ii) acknowledges that, by receiving Exchange Notes for
its own account in exchange for Notes, where such Notes were acquired as a
result of market-making activities or other trading activities, such
Participating Broker-Dealer will deliver a prospectus meeting the requirements
of the Securities Act in connection with any resale of such Exchange Notes;
however, by so acknowledging and delivering a prospectus, the undersigned will
not be deemed to admit that it is an "underwriter" within the meaning of the
Securities Act.
Holders of Notes that are tendering by book-entry transfer to the Exchange
Agent's account at DTC can execute the tender through the DTC Automated Tender
Offer Program ("ATOP"), for which the transaction will be eligible. DTC
participants that are accepting the Exchange Offer must transmit their
acceptance to DTC, which will verify the acceptance and execute a book-entry
delivery to the Exchange Agent's DTC account. DTC will then send an Agent's
Message to the Exchange Agent for its acceptance. DTC participants may also
accept the Exchange Offer prior to the Expiration Date by submitting a Notice of
Guaranteed Delivery through ATOP.
[ ] CHECK HERE IF TENDERED NOTES ARE BEING DELIVERED HEREWITH.
[ ] CHECK HERE IF TENDERED NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY DELIVERED TO THE EXCHANGE AGENT AND COMPLETE
"USE OF GUARANTEED DELIVERY" BELOW (Box 4).
[ ] CHECK HERE IF TENDERED NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH THE BOOK-ENTRY
TRANSFER FACILITY AND COMPLETE "USE OF BOOK-ENTRY TRANSFER" BELOW (Box 5).
[ ] CHECK HERE IF YOU ARE A PARTICIPATING BROKER-DEALER WHO ACQUIRED THE NOTES
FOR ITS OWN ACCOUNT AS A RESULT OF MARKET MAKING OR OTHER TRADING
ACTIVITIES AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND
10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO (Box 7).
3
<PAGE> 4
PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL
CAREFULLY BEFORE COMPLETING THE BOXES
BOX 1
DESCRIPTION OF NOTES TENDERED
(Attach additional signed pages, if necessary)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED NOTE HOLDER(S), CERTIFICATE AGGREGATE PRINCIPAL AGGREGATE PRINCIPAL
EXACTLY AS NAME(S) APPEAR(S) ON NOTE CERTIFICATE(S) NUMBER(S) OF AMOUNT REPRESENTED AMOUNT
(PLEASE FILL IN, IF BLANK) NOTES* BY CERTIFICATE(S) TENDERED**
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------
Total
</TABLE>
<TABLE>
<S> <C> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed by persons tendering by book-entry transfer.
** The minimum permitted tender is $1,000 in principal amount of Notes. All
other tenders must be in integral multiples of $1,000 of principal amount.
Unless otherwise indicated in this column, the principal amount of all Note
Certificates identified in this Box 1 or delivered to the Exchange Agent
herewith shall be deemed tendered. See Instruction 4.
BOX 2
BENEFICIAL OWNER(S)
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------
STATE OF PRINCIPAL RESIDENCE OF EACH PRINCIPAL AMOUNT OF TENDERED NOTES
BENEFICIAL OWNER OF TENDERED NOTES HELD FOR ACCOUNT OF BENEFICIAL OWNER
- -----------------------------------------------------------------------------------------------------------------
<S> <C>
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------
=================================================================================================================
</TABLE>
4
<PAGE> 5
BOX 3 BOX 4
- ------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 5, 6 AND 7)
TO BE COMPLETED ONLY IF EXCHANGE NOTES EXCHANGED FOR NOTES AND UNTENDERED
NOTES ARE TO BE SENT TO SOMEONE OTHER THAN THE UNDERSIGNED, OR TO THE
UNDERSIGNED AT AN ADDRESS OTHER THAN THAT SHOWN ABOVE
Mail Exchange Note(s) and any untendered Notes to:
Name(s):
--------------------------------------------
(PLEASE PRINT)
Address:
---------------------------------------------
------------------------------------------------------
------------------------------------------------------
(INCLUDE ZIP CODE)
------------------------------------------------------
TAX IDENTIFICATION OR SOCIAL SECURITY NO.
- ------------------------------------------------------
- ------------------------------------------------------
USE OF GUARANTEED DELIVERY
(SEE INSTRUCTION 2)
TO BE COMPLETED ONLY IF NOTES ARE BEING TENDERED BY MEANS OF A NOTICE OF
GUARANTEED DELIVERY.
Name(s) of Registered Holder(s):
------------------------------------------------------
Window Ticket No. (if any):
-------------------------
Date of Execution of Notice of Guaranteed Delivery:
------------------------------------------------------
Name of Institution that Guaranteed Delivery:
------------------------------------------------------
If Delivered by Book-Entry Transfer:
Account Number with DTC:
------------------
Transaction Code Number:
--------------------
- ------------------------------------------------------
BOX 5
USE OF BOOK-ENTRY TRANSFER
(SEE INSTRUCTION 2)
TO BE COMPLETED ONLY IF DELIVERY OF TENDERED NOTES IS TO BE MADE BY BOOK-ENTRY
TRANSFER.
Name of Tendering Institution:
- -----------------------------------------------------------------
Account Number:
- ------------------------------------------------------------------------------
Transaction Code Number:
- ---------------------------------------------------------------------
5
<PAGE> 6
BOX 6
TENDERING HOLDER SIGNATURE
(SEE INSTRUCTIONS 1 AND 5)
IN ADDITION, COMPLETE SUBSTITUTE FORM W-9
X
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
(SIGNATURE OF REGISTERED HOLDER(S) OR AUTHORIZED SIGNATORY)
Note: The above lines must be signed by the registered holder(s) of Notes as
their name(s) appear(s) on the Notes or by person(s) authorized to become
registered holder(s) (evidence of such authorization must be transmitted with
this Letter of Transmittal). If signature is by a trustee, executor,
administrator, guardian, attorney-in-fact, officer, or other person acting in a
fiduciary or representative capacity, such person must set forth his or her full
title below. See Instruction 5.
Name(s):
- --------------------------------------------------------------------------------
Capacity:
- --------------------------------------------------------------------------------
Street Address:
- --------------------------------------------------------------------------------
-------------------------------------------------------------------
(ZIP CODE)
Area Code and Telephone Number:
- ---------------------------------------------------------------------
Tax Identification or Social Security Number:
- ----------------------------------------------------------
SIGNATURE GUARANTEE
(IF REQUIRED BY INSTRUCTION 5)
Authorized Signature
- --------------------------------------------------------------------------------
X
- --------------------------------------------------------------------------------
Name:
- --------------------------------------------------------------------------------
(PLEASE PRINT)
Title:
- --------------------------------------------------------------------------------
Name of Firm:
- --------------------------------------------------------------------------------
(MUST BE AN ELIGIBLE INSTITUTION AS DEFINED IN INSTRUCTION 2)
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(ZIP CODE)
Area Code and Telephone Number:
- ---------------------------------------------------------------------
Dated:
- ---------------------------
6
<PAGE> 7
BOX 7
BROKER-DEALER STATUS
[ ] Check this box if the Beneficial Owner of the Notes is a Participating
Broker-Dealer and such Participating Broker-Dealer acquired the Notes for
its own account as a result of market-making activities or other trading
activities. If this box is checked, regardless of whether you are tendering
by book-entry transfer through ATOP, an executed copy of this Letter of
Transmittal must be received within three NYSE trading days after the
Expiration Date by CBS Corporation, attention Angeline C. Straka, facsimile
(212) .
<TABLE>
<S> <C> <C>
- ----------------------------------------------------------------------------------------------------------------------
EXCHANGE AGENT'S NAME: CITIBANK, N.A.
- ----------------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART 1 -- PLEASE PROVIDE YOUR TIN IN THE BOX
FORM W-9 AT RIGHT AND CERTIFY BY SIGNING AND DATING ---------------------------------
DEPARTMENT OF THE TREASURY BELOW Social Security Number
INTERNAL REVENUE SERVICE or
---------------------------------
Employer Identification Number
---------------------------------------------------------------------------------
PAYER'S REQUEST FOR PART 2 -- CERTIFICATION -- Under penalties of perjury, I certify that:
TAXPAYER IDENTIFICATION (1) The number shown on this form is my correct Taxpayer Identification Number (or
NUMBER ("TIN") I am waiting for a number to be issued to me) and
(2) I am not subject to backup withholding either because I have not been notified
by the Internal Revenue Service (the "IRS") that I am subject to backup
withholding as a result of failure to report all interest or dividends, or the IRS
has notified me that I am no longer subject to backup withholding.
---------------------------------------------------------------------------------
CERTIFICATION INSTRUCTIONS -- You must cross PART 3 --
out item (2) above if you have been notified Awaiting TIN [ ]
by the IRS that you are currently subject to
backup withholding because of underreporting
interest or dividends on your tax return.
However, if after being notified by the IRS
that you were subject to backup withholding
you received another notification from the
IRS that you are no longer subject to backup
withholding, do not cross out such item (2).
- ----------------------------------------------------------------------------------------------------------------------
Signature Date
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS SUBSTITUTE FORM W-9 MAY RESULT IN
BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU. PLEASE REVIEW THE
ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON
SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF
SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number
has not been issued to me, and either (a) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administrative Office or (b)
I intend to mail or deliver an application in the near future. I understand that
if I do not provide a taxpayer identification number by the time of payment, 31%
of all reportable payments made to me will be withheld, but that such amounts
will be refunded to me if I then provide a Taxpayer Identification Number within
60 days.
__________________________________________________ , 1998
Signature Date
7
<PAGE> 8
CBS CORPORATION
INSTRUCTIONS TO LETTER OF TRANSMITTAL
FORMING PART OF THE TERMS AND CONDITIONS
OF THE EXCHANGE OFFER
1. Delivery of this Letter of Transmittal and Notes. This Letter of
Transmittal is to be completed by registered holders of Notes if certificates
representing such Notes are to be forwarded herewith pursuant to the procedures
set forth in the Prospectus under "The Exchange Offer -- Procedures for
Tendering," unless delivery of such certificates is to be made by book-entry
transfer to the Exchange Agent's account maintained by DTC through ATOP. For a
holder to properly tender Notes pursuant to the Exchange Offer, a properly
completed and duly executed copy of this Letter of Transmittal, including
Substitute Form W-9, and any other documents required by this Letter of
Transmittal must be received by the Exchange Agent at its address set forth
herein, and either (i) certificates for Tendered Notes must be received by the
Exchange Agent at its address set forth herein, or (ii) such Tendered Notes must
be transferred pursuant to the procedures for book-entry transfer described in
the Prospectus under the caption "The Exchange Offer -- Procedures for
Tendering" (and a confirmation of such transfer received by the Exchange Agent),
in each case prior to 5:00 p.m., New York City time, on the Expiration Date. The
method of delivery of certificates for Tendered Notes, this Letter of
Transmittal and all other required documents to the Exchange Agent is at the
election and risk of the tendering holder and the delivery will be deemed made
only when actually received by the Exchange Agent. If delivery is by mail,
registered mail with return receipt requested, properly insured, is recommended.
Instead of delivery by mail, it is recommended that the holder use an overnight
or hand delivery service. In all cases, sufficient time should be allowed to
assure timely delivery. No Letter of Transmittal or Tendered Notes should be
sent to the Company. Neither the Company nor the Exchange Agent is under any
obligation to notify any tendering holder of the Company's acceptance of
Tendered Notes prior to the closing of the Exchange Offer.
2. Guaranteed Delivery Procedures. If a registered holder desires to
tender Notes pursuant to the Exchange Offer and (a) certificates representing
such tendered Notes are not immediately available, (b) time will not permit such
holder's Letter of Transmittal, certificates representing such Tendered Notes
and all other required documents to reach the Exchange Agent on or prior to the
Expiration Date, or (c) the procedures for book-entry transfer cannot be
completed on or prior to the Expiration Date, such holder may nevertheless
tender such Tendered Notes with the effect that such tender will be deemed to
have been received on or prior to the Expiration Date if the procedures set
forth below and in the Prospectus under "The Exchange Offer -- Guaranteed
Delivery Procedures" (including the completion of Box 4 above) are followed.
Pursuant to such procedures, (i) the tender must be made by or through an
Eligible Institution (as defined), (ii) a properly completed and duly executed
Notice of Guaranteed Delivery, substantially in the form provided by the Company
herewith, or an Agent's Message with respect to a guaranteed delivery that is
accepted by the Company, must be received by the Exchange Agent on or prior to
the Expiration Date, and (iii) the certificates for the Tendered Notes, in
proper form for transfer (or a Book-Entry Confirmation of the transfer of such
Tendered Notes to the Exchange Agent's account at DTC as described in the
Prospectus), together with a Letter of Transmittal (or manually signed facsimile
thereof) properly completed and duly executed, with any required signature
guarantees and any other documents required by the Letter of Transmittal or a
properly transmitted Agent's Message, must be received by the Exchange Agent
within three New York Stock Exchange trading days after the date of execution of
the Notice of Guaranteed Delivery. Any holder who wishes to tender Notes
pursuant to the guaranteed delivery procedures described above must ensure that
the Exchange Agent receives the Notice of Guaranteed Delivery relating to such
tendered Notes prior to 5:00 p.m., New York City time, on the Expiration Date.
Failure to complete the guaranteed delivery procedures outlined above will not,
of itself, affect the validity or effect a revocation of any Letter of
Transmittal form properly completed and executed by an Eligible Holder who
attempted to use the guaranteed delivery process.
3. Beneficial Owner Instructions to Registered Holders. Only a holder in
whose name Tendered Notes are registered on the books of the registrar (or the
legal representative or attorney-in-fact of such registered
8
<PAGE> 9
holder) may execute and deliver this Letter of Transmittal. Any Beneficial Owner
of Tendered Notes who is not the registered holder must arrange promptly with
the registered holder to execute and deliver this Letter of Transmittal on his
or her behalf through the execution and delivery to the registered holder of the
"Instructions to Registered Holder and/or Book-Entry Transfer Facility
Participant from Beneficial Owner" form accompanying this Letter of Transmittal.
4. Partial Tenders. Tenders of Notes will be accepted only in integral
multiples of $1,000 in principal amount. If less than the entire principal
amount of Notes held by the holder is tendered, the tendering holder should fill
in the principal amount tendered in the column labeled "Aggregate Principal
Amount Tendered" of the box entitled "Description of Notes Tendered" (see Box 1)
above. The entire principal amount of Notes delivered to the Exchange Agent will
be deemed to have been tendered unless otherwise indicated. If the entire
principal amount of all Notes held by the holder is not tendered, then Notes for
the principal amount of Notes not tendered and Exchange Notes issued in exchange
for any Notes tendered and accepted will be sent to the holder at his or her
registered address, unless a different address is provided in the appropriate
box on this Letter of Transmittal, as soon as practicable following the
Expiration Date,
5. Signatures on the Letter of Transmittal; Bond Powers and Endorsements;
Guarantee of Signatures. If this Letter of Transmittal is signed by the
registered holder(s) of the Tendered Notes, the signature must correspond with
the name(s) as written on the face of the Tendered Notes without alteration,
enlargement or any change whatsoever.
If any of the Tendered Notes are owned of record by two joint owners, all
such owners must sign this Letter of Transmittal. If any Tendered Notes are held
in different names, it will be necessary to complete, sign and submit as many
separate copies of the Letter of Transmittal as there are different names in
which Tendered Notes are held.
If this Letter of Transmittal is signed by the registered holder(s) of
Tendered Notes, and Exchange Notes issued in exchange therefor are to be issued
(and any untendered principal amount of Notes is to be reissued) in the name of
the registered holder(s), then such registered holder(s) need not and should not
endorse any Tendered Notes, nor provide a separate bond power. In any other
case, such registered holder(s) must either properly endorse the Tendered Notes
or a properly completed separate bond power with this Letter of Transmittal,
with the signature(s) on the endorsement or bond power guaranteed by a Medallion
Signature Guarantor (as defined below).
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of any Tendered Notes, such Tendered Notes must be endorsed
or accompanied by appropriate bond powers, in each case, signed as the name(s)
of the registered holder(s) appear(s) on the Tendered Notes, with the
signature(s) on the endorsement or bond power guaranteed by a Medallion
Signature Guarantor.
If this Letter of Transmittal or any Tendered Notes or bond powers are
signed by trustees, executors, administrators, guardians, attorney-in-fact,
officers of corporations, or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing and, unless waived by the
Company, evidence satisfactory to the Company of their authority to so act must
he submitted with this Letter of Transmittal.
Signatures on this Letter of Transmittal must be guaranteed by a recognized
participant in the Securities Transfer Agents Medallion Program, the New York
Stock Exchange Medallion Signature Program or the Stock Exchange Medallion
Program (each a "Medallion Signature Guarantor"), unless the Tendered Notes are
tendered (i) by a registered holder of Tendered Notes (or by a participant in
DTC whose name appears on a security position listing as the owner of such
Tendered Notes) who has not completed Box 3 ("Special Delivery Instructions") on
this Letter of Transmittal, or (ii) for the account of a member firm of a
registered national securities exchange, a member of the National Association of
Securities Dealers, Inc. ("NASD") or a commercial bank or trust company having
an office or correspondent in the United States (each of the foregoing being
referred to as an "Eligible Institution"). If the Tendered Notes are registered
in the name of a person other than the signor of the Letter of Transmittal or if
Notes not tendered are to be returned to a person other than the registered
holder, then the Signature on this Letter of Transmittal accompanying the
Tendered
9
<PAGE> 10
Notes must be guaranteed by a Medallion Signature Guarantor as described above.
Beneficial owners whose Notes are registered in the name of a broker, dealer,
commercial bank, trust company or other nominee if they desire to tender such
Notes.
6. Special Delivery Instructions. Tendering holders should indicate in
Box 3 the name and address to which the Exchange Notes and/or substitute Notes
for principal amounts not tendered or not accepted for exchange are to be sent,
if different from the name and address of the person signing this Letter of
Transmittal. In the case of issuance in a different name, the taxpayer
identification or social security number of the person must also be indicated.
7. Transfer Taxes. The Company will pay all transfer taxes, if any,
applicable to the exchange of Tendered Notes pursuant to the Exchange Offer. If,
however, a transfer tax is imposed for any reason other than the transfer and
exchange of Tendered Notes pursuant to the Exchange Offer, then the amount of
any such transfer taxes (whether imposed on the registered holder or on any
other person) will be payable by the tendering holder. If satisfactory evidence
of payment of such taxes or exemption therefrom is not submitted with this
Letter of Transmittal, the amount of such transfer taxes will be billed directly
to such tendering holder.
Except as provided in this Instruction 7, it will not be necessary for
transfer tax stamps to be affixed to the Tendered Notes listed in this Letter of
Transmittal.
8. Tax Identification Number. Federal income tax law requires that the
holder(s) of any Tendered Notes which are accepted for exchange must provide the
Exchange Agent (as payor) with its correct taxpayer identification number
("TIN"), which, in the case of a holder who is an individual, is his or her
social security number. If the Exchange Agent is not provided with the correct
TIN, the holder may be subject to backup withholding and a $50 penalty imposed
by the Internal Revenue Service. (If withholding results in an over-payment of
taxes, a refund may be obtained.) Certain holders (including, among others, all
corporations and certain foreign individuals) are not subject to these backup
withholding and reporting requirements. See the enclosed "Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9" for
additional instructions.
To prevent backup withholding, each holder of Tendered Notes must provide
such holder's correct TIN by completing the Substitute Form W-9 set forth
herein, certifying that the TIN provided is correct (or that such holder is
awaiting a TIN), and that (i) the holder has not been notified by the Internal
Revenue Service that such holder is subject to backup withholding as a result of
failure to report all interest or dividends or (ii) if previously so notified,
the Internal Revenue Service has notified the holder that such holder is no
longer subject to backup withholding. If the Tendered Notes are registered in
more than one name or are not in the name of the actual owner, consult the
"Guidelines for Certification of Taxpayer IdentificatIon Number on Substitute
Form W-9" for information on which TIN to report.
The Company reserves the right in its sole discretion to take whatever
steps are necessary to comply with the Company's obligation regarding backup
withholding.
9. Validity of Tenders. All questions as to the validity, form,
eligibility (including time of receipt), acceptance and withdrawal of Tendered
Notes will be determined by the Company in its sole discretion, which
determination will be final and binding. The Company reserves the right to
reject any and all Notes not validly tendered or any Notes the Company's
acceptance of which would, in the opinion of the Company or its counsel, be
unlawful. The Company also reserves the right to waive any conditions of the
Exchange Offer or defects or irregularities in tenders of Notes as to any
ineligibility of any holder who seeks to tender Notes in the Exchange Offer. The
interpretation of the terms and conditions of the Exchange Offer (including this
Letter of Transmittal and the instructions hereto) by the Company shall be final
and binding on all parties. Unless waived, any defects or irregularities in
connection with tenders of Notes must be cured within such time as the Company
shall determine. Neither the Company, the Exchange Agent nor any other person
shall be under any duty to give notification of defects or irregularities with
respect to tenders of Notes, nor shall any of them incur any liability for
failure to give such notification. Tenders of Notes will not be deemed to have
been made until such defects or irregularities have been cured or waived. Any
Notes received by the Exchange
10
<PAGE> 11
Agent that are not properly tendered and as to which the defects or
irregularities have not been cured or waived will be returned by the Exchange
Agent to the tendering holders, unless otherwise provided in this Letter of
Transmittal, as soon as practicable following the Expiration Date.
10. Waiver of Conditions. The Company reserves the absolute right to
amend, waive or modify any of the conditions in the Exchange Offer in the case
of any Tendered Notes.
11. No Conditional Tender. No alternative, conditional, irregular, or
contingent tender of Notes or transmittal of this Letter of Transmittal will be
accepted.
12. Mutilated, Lost, Stolen or Destroyed Notes. Any tendering holder
whose Notes have been mutilated, lost, stolen or destroyed should contact the
Exchange Agent at the address indicated herein for further instructions.
13. Requests for Assistance or Additional Copies. Questions and requests
for assistance and requests for additional copies of the Prospectus or this
Letter of Transmittal may be directed to the Exchange Agent at the address
indicated herein. Holders may also contact their broker, dealer, commercial
bank, trust company or other nominee for assistance concerning the Exchange
Offer.
14. Acceptance of Tendered Notes and Issuance of Exchange Notes; Return of
Notes. Subject to the terms and conditions of the Exchange Offer, the Company
will accept for exchange all validly tendered Notes as soon as practicable after
the Expiration Date and will issue Exchange Notes therefor as soon as
practicable thereafter. For purposes of the Exchange Offer, the Company shall be
deemed to have accepted Tendered Notes when, as and if the Company has given
written or oral notice (immediately followed in writing) thereof to the Exchange
Agent. If any Tendered Notes are not exchanged pursuant to the Exchange Offer
for any reason, such unexchanged Notes will be returned, without expense, to the
undersigned at the address shown in Box 1 or at a different address as may be
indicated herein under "Special Delivery Instructions" (Box 3).
15. Withdrawal. Tenders may be withdrawn only pursuant to the procedures
set forth in the Prospectus under the caption "The Exchange Offer -- Withdrawal
of Tenders."
11
<PAGE> 1
NOTICE OF GUARANTEED DELIVERY
IN RESPECT OF
7.15% SENIOR NOTES DUE 2005
OF
CBS CORPORATION
PURSUANT TO THE PROSPECTUS DATED , 1998
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON , 1998, UNLESS EXTENDED ("THE EXPIRATION DATE").
As set forth in the Prospectus dated , 1998 (as it may be
supplemented and amended from time to time, the "Prospectus") of CBS Corporation
(the "Company") under "The Exchange Offer -- Guaranteed Delivery Procedures,"
and in the Instructions to the related Letter of Transmittal (the "Letter of
Transmittal"), this form, or one substantially equivalent hereto, or an Agent's
Message relating to the guaranteed delivery procedures, must be used to accept
the Company's offer (the "Exchange Offer") to exchange any and all of its
outstanding 7.15% Senior Notes due 2005 (the "Notes"), for new 7.15% Senior
Notes due 2005 (the "Exchange Notes") if time will not permit the Letter of
Transmittal, certificates representing such Notes and other required documents
to reach the Exchange Agent, or the procedures for book-entry transfer cannot be
completed, on or prior to the Expiration Date (as defined).
This form must be delivered by an Eligible Institution (as defined herein)
by mail or hand delivery or transmitted via facsimile to the Exchange Agent as
set forth above. If a signature on the Letter of Transmittal is required to be
guaranteed by a Medallion Signature Guarantor under the instructions thereto,
such signature guarantee must appear in the applicable space provided in the
Letter of Transmittal. This form is not to be used to guarantee signatures.
Questions and requests for assistance and requests for additional copies of
the Prospectus may be directed to the Exchange Agent at the address above.
Holders may also contact their broker, dealer, commercial bank, trust company,
or other nominee for assistance concerning the Exchange Offer.
THE EXCHANGE AGENT FOR THE EXCHANGE OFFER IS:
CITIBANK, N.A.
<TABLE>
<S> <C> <C>
By Mail: By Overnight Delivery: By Hand:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
c/o Citicorp Data Distributions, Inc. c/o Citicorp Data Distributions, Inc. Corporate Trust Window
P.O. Box 7072 404 Sette Drive 111 Wall Street, 5th Floor
Paramus, New Jersey 07653 Paramus, New Jersey 07652 New York, New York 10043
Facsimile for Eligible Institutions:
(201) 262-3240
Facsimile Confirmation Only:
(800) 422-2077
For Information:
(800) 422-2077
</TABLE>
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS, OR
TRANSMISSION VIA FACSIMILE TO A NUMBER, OTHER THAN AS SET FORTH ABOVE WILL NOT
CONSTITUTE VALID DELIVERY.
<PAGE> 2
Ladies and Gentlemen:
The undersigned hereby tender(s) to the Company, upon the terms and subject
to the conditions set forth in the Prospectus and the related Letter of
Transmittal (receipt of which is hereby acknowledged), the principal amount of
the Notes specified below pursuant to the guaranteed delivery procedures set
forth in the Prospectus under "The Exchange Offer -- Guaranteed Delivery
Procedures" and in Instruction 2 to the Letter of Transmittal. The undersigned
hereby authorizes the Exchange Agent to deliver this Notice of Guaranteed
Delivery to the Company with respect to the Notes tendered pursuant to the
Exchange Offer.
The undersigned understands that Notes will be exchanged only after timely
receipt by the Exchange Agent of (i) such Notes, or a Book-Entry Confirmation,
and (ii) a Letter of Transmittal (or a manually signed facsimile thereof),
including by means of an Agent's Message, of the transfer of such Notes into the
Exchange Agent's account at the Book-Entry Transfer Facility, with respect to
such Notes, properly completed and duly executed, with any signature guarantees
and any other documents required by the Letter of Transmittal within three New
York Stock Exchange, Inc. trading days after the execution hereof. The
undersigned also understands that the method of delivery of this Notice of
Guaranteed Delivery and any other required documents to the Exchange Agent is at
the election and sole risk of the holder, and the delivery will be deemed made
only when actually received by the Exchange Agent.
The undersigned understands that tenders of Notes will be accepted only in
principal amounts equal to $1,000 or integral multiples thereof. The undersigned
also understands that tenders of Notes may be withdrawn at any time prior to the
Expiration Date.
All authority conferred or agreed to be conferred by this Notice of
Guaranteed Delivery shall not be affected by, and shall survive, the death or
incapacity of the undersigned, and every obligation of the undersigned under
this Notice of Guaranteed Delivery shall be binding upon the heirs, executors,
administrators, trustees in bankruptcy, personal and legal representatives,
successors and assigns of the undersigned.
All capitalized terms used herein but not defined herein shall have the
meanings ascribed to them in the Prospectus.
2
<PAGE> 3
PLEASE SIGN AND COMPLETE
Principal Amount of Notes Tendered:
-------------------------------------------------------------------
Name(s) of Registered Holder(s):
----------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Certificate No.(s) of Notes (if available):
--------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Area Code and Telephone No.:
--------------------------------------------------------------------------
If Notes will be delivered by book-entry transfer, provide the following
information:
Signature(s) of Registered Holder(s)
or Authorized Signatory:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
DTC Account No.:
- --------------------------------------------------------------------------------
Date:
- --------------------------------------------------------------------------------
THIS NOTICE OF GUARANTEED DELIVERY MUST BE SIGNED BY THE HOLDER(S) EXACTLY AS
THEIR NAME(S) APPEAR(S) ON CERTIFICATE(S) FOR NOTES OR ON A SECURITY POSITION
LISTING AS THE OWNER OF NOTES, OR BY PERSON(S) AUTHORIZED TO BECOME HOLDER(S) BY
ENDORSEMENTS AND DOCUMENTS TRANSMITTED WITH THIS NOTICE OF GUARANTEED DELIVERY
WITHOUT ALTERATION, ENLARGEMENT OR ANY CHANGE WHATSOEVER. IF SIGNATURE IS BY A
TRUSTEE, EXECUTOR, ADMINISTRATOR, GUARDIAN, ATTORNEY-IN-FACT, OFFICER OR OTHER
PERSON ACTING IN A FIDUCIARY OR REPRESENTATIVE CAPACITY, SUCH PERSON MUST
PROVIDE THE FOLLOWING INFORMATION.
Please print name(s) and address(es)
Name(s):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Capacity:
- --------------------------------------------------------------------------------
Address(es):
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
3
<PAGE> 4
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a member of the Securities Transfer Agents Medallion
Program, the Stock Exchange Medallion Program or the New York Stock Exchange,
Inc. Medallion Signature Program (each, an "Eligible Institution"), hereby (i)
represents that the above-named persons are deemed to own the Notes tendered
hereby within the meaning of Rule 14e-4 promulgated under the Securities
Exchange Act of 1934, as amended ("Rule 14e-4"), (ii) represents that such
tender of Notes complies with Rule 14e-4 and (iii) guarantees that the Notes
tendered hereby are in proper form for transfer (pursuant to the procedures set
forth in the Prospectus under "The Exchange Offer -- Guaranteed Delivery
Procedures"), and that the Exchange Agent will receive (a) such Notes, or a
Book-Entry Confirmation of the transfer of such Notes into the Exchange Agent's
account at the Book-Entry Transfer Facility and (b) a properly completed and
duly executed Letter of Transmittal or facsimile thereof (or Agent's message)
with any required signature guarantees and any other documents required by the
Letter of Transmittal within three New York Stock Exchange, Inc. trading days
after the date of execution hereof.
The Eligible Institution that completes this form must communicate the
guarantee to the Exchange Agent and must deliver the Letter of Transmittal and
Notes to the Exchange Agent within the time period shown herein. Failure to do
so could result in a financial loss to such Eligible Institution.
Name of Firm:
- --------------------------------------------------------------------------------
Authorized Signature:
- --------------------------------------------------------------------------------
Title:
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(Zip Code)
Area Code and Telephone Number:
---------------------------------------------------------------------
Dated:
- ------------------------------------ , 1998
DO NOT SEND NOTES WITH THIS FORM. NOTES SHOULD BE SENT TO THE EXCHANGE AGENT
TOGETHER WITH A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL.
4
<PAGE> 1
INSTRUCTIONS TO REGISTERED HOLDER AND/OR
BOOK-ENTRY TRANSFER FACILITY PARTICIPANT FROM BENEFICIAL OWNER
OF
CBS CORPORATION
7.15% SENIOR NOTES DUE 2005
To Registered Holder and/or Participant of the Book-Entry Transfer
Facility:
The undersigned hereby acknowledges receipt of the Prospectus, dated
, 1998 (as the same may be amended or supplemented from time to time,
the "Prospectus") of CBS Corporation, a Pennsylvania corporation (the
"Company"), and the accompanying Letter of Transmittal (the "Letter of
Transmittal"), that together constitute the Company's offer (the "Exchange
Offer"), Capitalized terms used but not defined herein have the meanings
ascribed to them in the Prospectus.
This will instruct you, the registered holder and/or book-entry transfer
facility participant, as to action to be taken by you relating to the Exchange
Offer with respect to the 7.15% Senior Notes due 2005 (the "Notes") held by you
for the account of the undersigned.
The aggregate face amount of the Notes held by you for the account of the
undersigned is (fill in amount):
$ of the 7.15% Senior Notes due 2005.
With respect to the Exchange Offer, the undersigned hereby instructs you
(check appropriate box):
[ ] TO TENDER the following Notes held by you for the account of the
undersigned (insert principal amount of Notes to be tendered, if any):
$
[ ] NOT TO TENDER any Notes held by you for the account of the
undersigned.
If the undersigned instruct you to tender the Notes held by you for the
account of the undersigned, it is understood that you are authorized (a) to
make, on behalf of the undersigned (and the undersigned, by its signature below,
hereby makes to you), the representation and warranties contained in the Letter
of Transmittal that are to be made with respect to the undersigned as a
beneficial owner, including, but not limited to, the representations that (i)
the undersigned's principal residence is in the State of (fill in
State) (ii) the undersigned is acquiring the Exchange Notes in the ordinary
course of business of the undersigned, (iii) the undersigned is not
participating, does not participate, and has no arrangement or understanding
with any person to participate in the distribution of the Exchange Notes, (iv)
the undersigned acknowledges that any person participating in the Exchange Offer
for the purpose of distributing the Exchange Notes must comply with the
registration and prospectus delivery requirements of the Securities Act of 1933,
as amended (the "Act"), in connection with a secondary resale transaction of the
Exchange Notes acquired by such person and cannot rely on the position of the
Staff of the Securities and Exchange Commission set forth in no-action letters
that are discussed in the section of the Prospectus entitled "The Exchange
Offer -- Resale of the Exchange Notes," and (v) the undersigned is not an
"affiliate," as defined in Rule 405 under the Act, of the Company; (b) to agree,
on behalf of the undersigned, as set forth in the Letter of Transmittal; and (c)
to take such other action as necessary under the Prospectus or the Letter of
Transmittal to effect the valid tender of such Notes.
- --------------------------------------------------------------------------------
<PAGE> 2
[ ] Check this box if the Beneficial Owner of the Note is a Participating
Broker-Dealer and such Participating Broker-Dealer acquired the Notes
for its own account as a result of market-making activities or other
trading activities. If this box is checked, a copy of these
Instructions must be received within three New York Stock Exchange
trading days after the Expiration Date by CBS Corporation, attention
Angeline C. Straka, facsimile (212) .
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SIGN HERE
Name of beneficial owner(s):
---------------------------------------------------------------------------
Signature(s):
- --------------------------------------------------------------------------------
Name (please print):
- --------------------------------------------------------------------------------
Address:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Telephone number:
- --------------------------------------------------------------------------------
Taxpayer Identification or Social Security Number:
---------------------------------------------------
Date:
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
2
<PAGE> 1
Exhibit 99.4
____ __, 1998
EXCHANGE AGENT AGREEMENT
Citibank, N.A.
[Corporate Trust Trustee Administration]
_________________________
New York, New York ___________
___________
Ladies and Gentlemen:
CBS Corporation (the "Company") proposes to make an offer (the
"Exchange Offer") to exchange its 7.15% Senior Notes due 2005 (the "Old Notes")
for its 7.15% Senior Notes due 2005 (the "Exchange Notes"). The terms and
conditions of the Exchange Offer as currently contemplated are set forth in a
prospectus, dated _________, 1998 (the "Prospectus"), proposed to be distributed
to all record holders of the Old Notes. The Old Notes and the Exchange Notes are
collectively referred to herein as the "Notes".
The Company hereby appoints Citibank, N.A. to act as exchange
agent (the "Exchange Agent") in connection with the Exchange Offer. References
hereinafter to "you" shall refer to Citibank, N.A.
The Exchange Offer is expected to be commenced by the Company
on or about _______, 1998. The Letter of Transmittal accompanying the Prospectus
(or in the case of book entry securities, the ATOP system) is to be used by the
holders of the Old Notes to accept the Exchange Offer and contains instructions
with respect to the delivery of certificates for Old Notes tendered in
connection therewith.
The Exchange Offer shall expire at 5:00 P.M., New York City
time, on ________, 1998 or on such later date or time to which the Company may
extend the Exchange Offer (the "Expiration Date"). Subject to the terms and
conditions set forth in the Prospectus, the Company expressly reserves the right
to extend the Exchange Offer from time to time and may extend the Exchange Offer
by giving oral (confirmed in writing) or written notice to you before 9:00 A.M.,
New York City time, on the business day following the previously scheduled
Expiration Date.
<PAGE> 2
The Company expressly reserves the right to amend or terminate
the Exchange Offer, and not to accept for exchange any Old Notes not theretofore
accepted for exchange, upon the occurrence of any of the conditions of the
Exchange Offer specified in the Prospectus under the caption "The Exchange
Offer-Conditions." The Company will give oral (confirmed in writing) or written
notice of any amendment, termination or nonacceptance to you as promptly as
practicable.
In carrying out your duties as Exchange Agent, you are to act
in accordance with the following instructions:
1. You will perform such duties and only such duties as are
specifically set forth in the section of the Prospectus captioned "The Exchange
Offer" or as specifically set forth herein; provided, however, that in no way
will your general duty to act in good faith be discharged by the foregoing.
2. You will establish an account with respect to the Old Notes
at The Depository Trust Company (the "Book-Entry Transfer Facility") for
purposes of the Exchange Offer within two business days after the date of the
Prospectus, and any financial institution that is a participant in the
Book-Entry Transfer Facility's systems may make book-entry delivery of the Old
Notes by causing the Book-Entry Transfer Facility to transfer such Old Notes
into your account in accordance with the Book-Entry Transfer Facility's
procedure for such transfer.
3. You are to examine each of the Letters of Transmittal and
certificates for Old Notes (or confirmation of book-entry transfer into your
account at the Book-Entry Transfer Facility) and any other documents delivered
or mailed to you by or for holders of the Old Notes to ascertain whether: (i)
the Letters of Transmittal and any such other documents are duly executed and
properly completed in accordance with instructions set forth therein and (ii)
the Old Notes have otherwise been properly tendered. In each case where the
Letter of Transmittal or any other document has been improperly completed or
executed or any of the certificates for Old Notes are not in proper form for
transfer or some other irregularity in connection with the acceptance of the
Exchange Offer exists, you will endeavor to inform the presenters of the need
for fulfillment of all requirements and to take any other action as may be
necessary or advisable to cause such irregularity to be corrected.
2
<PAGE> 3
4. With the approval of the Chief Executive Officer, President
or any Vice President of the Company (such approval, if given orally, to be
confirmed in writing) or any other party designated by such an officer in
writing, you are authorized to waive any irregularities in connection with any
tender of Old Notes pursuant to the Exchange Offer.
5. Tenders of Old Notes may be made only as set forth in the
Letter of Transmittal and in the section of the Prospectus captioned "The
Exchange Offer-Procedures for Tendering", and Old Notes shall be considered
properly tendered to you only when tendered in accordance with the
procedures set forth therein.
Notwithstanding the provisions of this paragraph 5, Old Notes
which the Chief Executive Officer, President or any Vice President of the
Company shall approve as having been properly tendered shall be considered to be
properly tendered (such approval, if given orally, shall be confirmed in
writing).
6. You shall advise the Company with respect to any Old Notes
received subsequent to the Expiration Date and accept its instructions with
respect to disposition of such Old Notes.
7. You shall accept tenders:
(a) in cases where the Old Notes are registered in two or more
names only if signed by all named holders;
(b) in cases where the signing person (as indicated on the
Letter of Transmittal) is acting in a fiduciary or a representative capacity
only when proper evidence of his or her authority so to act is submitted; and
(c) from persons other than the registered holder of Old Notes
provided that customary transfer requirements, including any applicable transfer
taxes, are fulfilled.
You shall accept partial tenders of Old Notes where so
indicated and as permitted in the Letter of Transmittal and deliver certificates
for Old Notes to the transfer agent for split-up and return any untendered Old
Notes to the holder (or such other person as may be designated in the Letter of
Transmittal) as promptly as practicable after expiration or termination of the
Exchange Offer.
3
<PAGE> 4
8. Upon satisfaction or waiver of all of the conditions to the
Exchange Offer, the Company will notify you (such notice if given orally, to be
confirmed in writing) of its acceptance, promptly after the Expiration Date, of
all Old Notes properly tendered and you, on behalf of the Company, will exchange
such Old Notes for Exchange Notes and cause such Old Notes to be cancelled.
Delivery of Exchange Notes will be made on behalf of the Company by you at the
rate of $1,000 principal amount of Exchange Notes for each $1,000 principal
amount of the corresponding series of Old Notes tendered promptly after notice
(such notice if given orally, to be confirmed in writing) of acceptance of said
Old Notes by the Company; provided, however, that in all cases, Old Notes
tendered pursuant to the Exchange Offer will be exchanged only after timely
receipt by you of certificates for such Old Notes (or confirmation of book-entry
transfer into your account at the Book-Entry Transfer Facility), a properly
completed and duly executed Letter of Transmittal (or facsimile thereof) with
any required signature guarantees and any other required documents. You shall
issue Exchange Notes only in denominations of $1,000 or any integral multiple
thereof.
9. Tenders pursuant to the Exchange Offer are irrevocable,
except that, subject to the terms and upon the conditions set forth in the
Prospectus and the Letter of Transmittal, Old Notes tendered pursuant to the
Exchange Offer may be withdrawn at any time prior to the Expiration Date.
10. The Company shall not be required to exchange any Old
Notes tendered if any of the conditions set forth in the Exchange Offer are not
met. Notice of any decision by the Company not to exchange any Old Notes
tendered shall be given (and confirmed in writing) by the Company to you.
11. If, pursuant to the Exchange Offer, the Company does not
accept for exchange all or part of the Old Notes tendered because of an invalid
tender, the occurrence of certain other events set forth in the Prospectus under
the caption "The Exchange Offer-Conditions" or otherwise, you shall as soon as
practicable after the expiration or termination of the Exchange Offer return
those certificates for unaccepted Old Notes (or effect appropriate book-entry
transfer), together with any related required documents and the Letters of
Transmittal relating thereto that are in your possession, to the persons who
deposited them.
4
<PAGE> 5
12. All certificates for reissued Old Notes, unaccepted Old
Notes or for Exchange Notes shall be forwarded by first-class mail.
13. You are not authorized to pay or offer to pay any
concessions, commissions or solicitation fees to any broker, dealer, bank or
other persons or to engage or utilize any person to solicit tenders.
14. As Exchange Agent hereunder you:
(a) shall have no duties or obligations other
than those specifically set forth herein or as may be subsequently agreed to in
writing by you and the Company;
(b) will be regarded as making no representations
and having no responsibilities as to the validity, sufficiency, value or
genuineness of any of the certificates or the Old Notes represented thereby
deposited with you pursuant to the Exchange Offer, and will not be required to
and will make no representation as to the validity, value or genuineness of the
Exchange Offer;
(c) shall not be obligated to take any legal action
hereunder which might in your reasonable judgment involve any expense or
liability, unless you shall have been furnished with reasonable indemnity;
(d) may reasonably rely on and shall be protected
in acting in reliance upon any certificate, instrument, opinion, notice, letter,
telegram or other document or security delivered to you and reasonably believed
by you to be genuine and to have been signed by the proper party or parties;
(e) may reasonably act upon any tender, statement,
request, comment, agreement or other instrument whatsoever not only as to its
due execution and validity and effectiveness of its provisions, but also as to
the truth and accuracy of any information contained therein, which you shall in
good faith believe to be genuine or to have been signed or represented by a
proper person or persons;
(f) may rely on and shall be protected in acting upon
written or oral instructions from any officer of the Company;
(g) may consult with your counsel with respect to any
questions relating to your duties and respon-
5
<PAGE> 6
sibilities and the advice or opinion of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
to be taken by you hereunder in good faith and in accordance with the advice or
opinion of such counsel; and
(h) shall not advise any person tendering Old
Notes pursuant to the Exchange Offer as to the wisdom of making such tender or
as to the market value or decline or appreciation in market value of any Old
Notes.
15. You shall take such action as may from time to time be
requested by the Company or its counsel (and such other action as you may
reasonably deem appropriate) to furnish copies of the Prospectus, Letter of
Transmittal and the Notice of Guaranteed Delivery (as defined in the Prospectus)
or such other forms as may be approved from time to time by the Company, to all
persons requesting such documents and to accept and comply with telephone
requests for information relating to the Exchange Offer, provided that such
information shall relate only to the procedures for accepting (or withdrawing
from) the Exchange Offer. The Company will furnish you with copies of such
documents at your request. All other requests for information relating to the
Exchange Offer shall be directed to the Company, Attention: ______________,
[Director of Investor Relations].
16. You shall advise by facsimile transmission or telephone,
and promptly thereafter confirm in writing to Angeline C. Straka, Esq., of the
Company, David G. Schwartz, Esq., of Weil, Gotshal & Manges LLP, counsel to the
Company (facsimile no. (212) 735-4710)), and such other person or persons as it
may request, daily (and more frequently during the week immediately preceding
the Expiration Date and if otherwise requested) up to and including the
Expiration Date, as to the number of Old Notes which have been tendered pursuant
to the Exchange Offer and the items received by you pursuant to this Agreement,
separately reporting and giving cumulative totals as to items properly received
and items improperly received. In addition, you will also inform, and cooperate
in making available to, the Company or any such other person or persons upon
oral request made from time to time prior to the Expiration Date of such other
information as it or he or she reasonably requests. Such cooperation shall
include, without limitation, the granting by you to the Company and such person
as the Company may request of access to those persons on your staff who are
responsible for receiving tenders, in order to ensure that immediately prior to
the Expiration Date the Company shall have received infor-
6
<PAGE> 7
mation in sufficient detail to enable it to decide whether to extend the
Exchange Offer. You shall prepare a final list of all persons whose tenders were
accepted, the aggregate principal amount of Old Notes tendered, the aggregate
principal amount of Old Notes accepted and deliver said list to the Company.
17. Letters of Transmittal and Notices of Guaranteed Delivery
shall be stamped by you as to the date and the time of receipt thereof and shall
be preserved by you for a period of time at least equal to the period of time
you preserve other records pertaining to the transfer of securities. You shall
dispose of unused Letters of Transmittal and other surplus materials by
returning them to the Company.
18. You hereby expressly waive any lien, encumbrance or right
of set-off whatsoever that you may have with respect to funds deposited with you
for the payment of transfer taxes by reasons of amounts, if any, borrowed by the
Company, or any of its subsidiaries or affiliates pursuant to any loan or credit
agreement with you or for compensation owed to you hereunder.
19. For services rendered as Exchange Agent hereunder, you
shall be entitled to such compensation as set forth on Schedule I attached
hereto.
20. You hereby acknowledge receipt of the Prospectus and the
Letter of Transmittal and further acknowledge that you have examined each of
them. Any inconsistency between this Agreement, on the one hand, and the
Prospectus and the Letter of Transmittal (as they may be amended from time to
time), on the other hand, shall be resolved in favor of the latter two
documents, except with respect to the duties, liabilities and indemnification of
you as Exchange Agent, which shall be controlled by this Agreement.
21. The Company covenants and agrees to indemnify and hold you
harmless in your capacity as Exchange Agent hereunder against any loss,
liability, cost or expense, including attorneys' fees and expenses, arising out
of or in connection with any act, omission, delay or refusal made by you in
reliance upon any signature, endorsement, assignment, certificate, order,
request, notice, instruction or other instrument or document reasonably believed
by you to be valid, genuine and sufficient and in accepting any tender or
effecting any transfer of Old Notes reasonably believed by you in good faith to
be authorized, and in delaying or refusing in good faith to accept any tenders
or effect any
7
<PAGE> 8
transfer of Old Notes; provided, however, that the Company shall not be liable
for indemnification or otherwise for any loss, liability, cost or expense to the
extent arising out of your gross negligence or willful misconduct. In no case
shall the Company be liable under this indemnity with respect to any claim
against you unless the Company shall be notified by you, by letter or by
facsimile confirmed by letter, of the written assertion of a claim against you
or of any other action commenced against you, promptly after you shall have
received any such written assertion or notice of commencement of action. The
Company shall be entitled to participate at its own expense in the defense of
any such claim or other action, and, if the Company so elects, the Company shall
assume the defense of any suit brought to enforce any such claim. In the event
that the Company shall assume the defense of any such suit, the Company shall
not be liable for the fees and expenses of any additional counsel thereafter
retained by you so long as the Company shall retain counsel satisfactory to you
to defend such suit, and so long as you have not determined, in your reasonable
judgment, that a conflict of interest exists between you and the Company.
22. You shall arrange to comply with all requirements under
the tax laws of the United States, including those relating to missing Tax
Identification Numbers, and shall file any appropriate reports with the Internal
Revenue Service. The Company understands that you are required to deduct 31% on
payments to holders who have not supplied their correct Taxpayer Identification
Number or required certification. Such funds will be turned over to the Internal
Revenue Service in accordance with applicable regulations.
23. You shall deliver or cause to be delivered, in a timely
manner to each governmental authority to which any transfer taxes are payable in
respect of the exchange of Old Notes, your check in the amount of all transfer
taxes so payable, and the Company shall reimburse you for the amount of any and
all transfer taxes payable in respect of the exchange of Old Notes; provided,
however, that you shall reimburse the Company for amounts refunded to you in
respect of your payment of any such transfer taxes, at such time as such refund
is received by you.
24. This Agreement and your appointment as Exchange Agent
hereunder shall be construed and enforced in accordance with the laws of the
State of New York applicable to agreements made and to be performed entirely
within such state, and without regard to conflicts of law principles, and shall
inure to the benefit of, and the obligations created
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hereby shall be binding upon, the successors and assigns of each of the parties
hereto.
25. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
26. In case any provision of this Agreement shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
27. This Agreement shall not be deemed or construed to be
modified, amended, rescinded, cancelled or waived, in whole or in part, except
by a written instrument signed by a duly authorized representative of the party
to be charged. This Agreement may not be modified orally.
28. Unless otherwise provided herein, all notices, requests
and other communications to any party hereunder shall be in writing (including
facsimile or similar writing) and shall be given to such party, addressed to it,
at its address or telecopy number set forth below:
If to the Company:
CBS Corporation
51 West 52nd Street
New York, New York 10019
Facsimile: (212) ___-____
Attention: Angeline C. Straka, Esq.
If to the Exchange Agent:
Citibank, N.A.
____________________
____________________
New York, New York _____
Facsimile: (212) ___-____
Attention: [Corporate Trust Trustee
Administration]
29. Unless terminated earlier by the parties hereto, this
Agreement shall terminate 90 days following the Expiration Date. Notwithstanding
the foregoing, Paragraphs 19, 21 and 23 shall survive the termination of this
Agreement. Upon any termination of this Agreement, you shall
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promptly deliver to the Company any certificates for Notes, funds or property
then held by you as Exchange Agent under this Agreement.
30. This Agreement shall be binding and effective as of the
date hereof.
Please acknowledge receipt of this Agreement and confirm the
arrangements herein provided by signing and returning the enclosed copy.
CBS CORPORATION
By:________________________
Name:
Title:
Accepted as of the date first above written:
CITIBANK, N.A., as Exchange Agent
By:_____________________
Name:
Title:
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SCHEDULE I
FEES
Flat fee ................................. $_,___
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