<PAGE> 1
SCHEDULE 14A
(RULE 14A)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934
Filed by the Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY RULE
14A-6(E)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to sec.240.14a-11(c) or sec.240.14a-12
</TABLE>
CBS CORPORATION
- --------------------------------------------------------------------------------
(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
- --------------------------------------------------------------------------------
(NAME OF PERSON(S) FILING PROXY STATEMENT, IF OTHER THAN THE REGISTRANT)
Payment of filing fee (Check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
---------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
---------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
---------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
---------------
(5) Total fee paid:
------------------------------------------------
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
----------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------
(3) Filing Party:
--------------------------------------------------
(4) Date Filed:
----------------------------------------------------
[ X ] No fee required
<PAGE> 2
CBS Corporation
Notice of 1999 Annual Meeting
[CBS LOGO] and Proxy Statement
May 4, 1999
<PAGE> 3
[CBS LOGO]
CBS Corporation
51 West 52nd Street
New York, NY 10019
March 25, 1999
DEAR FELLOW SHAREHOLDER:
It is my pleasure to invite you to attend CBS Corporation's 1999 Annual
Meeting of Shareholders. The meeting will be held at the Sheraton New York Hotel
located at 811 Seventh Avenue (at 52nd Street), New York, New York on Tuesday
May 4, 1999, beginning at 10:30 a.m., local time. The accompanying Notice of
Annual Meeting and Proxy Statement describes the business to be transacted at
the meeting.
At this year's shareholders' meeting, you will be asked to elect 10
directors, to elect KPMG LLP as independent auditors for 1999, and to consider
one shareholder proposal, if presented by its proponent.
It is important that your shares be represented at the Annual Meeting,
regardless of the number of shares you own. Whether or not you plan to attend
the Annual Meeting, please complete, sign, date and return your proxy card as
soon as possible. Your vote is important to the Board of Directors. We
appreciate your time and attention to the accompanying proxy statement.
We are also grateful for your support and continued interest in CBS
Corporation. Mel Karmazin, President and Chief Executive Officer, and I look
forward to seeing you at the meeting.
Sincerely,
/s/ David T. McLaughlin
--------------------------
David T. McLaughlin
Chairman of the Board
1
<PAGE> 4
CBS CORPORATION
NOTICE OF ANNUAL MEETING
MAY 4, 1999
The 1999 Annual Meeting of Shareholders of CBS Corporation will be held at
the Sheraton New York Hotel, located at 811 Seventh Avenue (at 52nd Street), New
York, New York, on Tuesday, May 4, 1999, beginning at 10:30 a.m., local time.
The purposes of the meeting are to consider and act upon:
(1) the election of 10 directors, each for a term of one year;
(2) the election of KPMG LLP as independent auditors for 1999;
(3) if properly presented, the shareholder proposal contained herein; and
(4) such other business as may properly come before the meeting.
The Board of Directors has fixed the close of business on February 26, 1999
as the record date for determining those shareholders who are entitled to notice
of and to vote at the meeting and any adjournment thereof.
The vote of each shareholder is important. In order to obtain the maximum
representation at the meeting, we urge you to complete, sign, date and return
your proxy card as promptly as possible. In this way, if you are unable to
attend, your shares can nevertheless be voted at the meeting. This will not
prevent you from voting your shares in person if you are present at the meeting.
A return envelope is enclosed for your convenience. Your proxy may be revoked by
delivering a later-dated and signed proxy or written notice of revocation to the
Secretary of the Company prior to the time voting is declared closed, or by
attending the meeting and voting your shares in person.
IF YOU PLAN TO ATTEND THE ANNUAL MEETING, PLEASE KEEP THE ADMISSION TICKET
THAT IS ATTACHED TO THE PROXY CARD ACCOMPANYING THIS NOTICE OF ANNUAL MEETING
AND PROXY STATEMENT, AND ALSO CHECK THE APPROPRIATE BOX ON YOUR PROXY CARD.
SHAREHOLDERS WHO OWN SHARES THROUGH BANKS OR BROKERS AND WHO PLAN TO ATTEND MUST
SEND A WRITTEN NOTIFICATION, ALONG WITH PROOF OF OWNERSHIP (SUCH AS A BANK OR
BROKERAGE FIRM ACCOUNT STATEMENT), TO THE SECRETARY'S OFFICE, 51 WEST 52ND
STREET, NEW YORK, NEW YORK 10019. THE NAMES OF THOSE SHAREHOLDERS INDICATING
THEY PLAN TO ATTEND WILL BE PLACED ON AN ADMISSION LIST HELD AT THE REGISTRATION
DESK AT THE ENTRANCE TO THE MEETING. ADMISSION TICKETS WILL NOT BE MAILED IN
ADVANCE OF THE MEETING.
On Behalf of the Board of Directors,
/s/ Angeline C. Straka
-----------------------------------
Angeline C. Straka
Secretary
New York, New York
March 25, 1999
YOUR VOTE IS IMPORTANT. ACCORDINGLY, PLEASE COMPLETE, SIGN, DATE AND RETURN THE
ACCOMPANYING PROXY CARD WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING.
2
<PAGE> 5
TABLE OF CONTENTS
<TABLE>
<CAPTION>
<S> <C>
Election of Directors .............................................................................4
The Board of Directors and its Committees.........................................................10
Director Compensation.............................................................................11
Related Party Transactions........................................................................12
Security Ownership................................................................................13
Executive Compensation ...........................................................................15
Summary Compensation Table.....................................................................15
Option Grants..................................................................................16
Option Exercises and Fiscal Year-End Values....................................................17
Pension Benefits...............................................................................17
Compensation and Severance Arrangements........................................................20
Compensation Committee Report on Executive Compensation........................................22
Shareholder Return Performance Graph..............................................................26
Election of Independent Auditors..................................................................26
Shareholder Proposal: Expand Executive Compensation Disclosure Requirements.......................27
Voting Information................................................................................28
Shareholder Proposal Submissions for 2000 Annual Meeting of Shareholders..........................28
Solicitation of Proxies ..........................................................................28
</TABLE>
3
<PAGE> 6
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
MAY 4, 1999
This proxy statement is furnished in connection with the solicitation by
the Board of Directors of CBS Corporation ("CBS" or the "Company") of proxies
for the 1999 Annual Meeting of Shareholders to be held on May 4, 1999, and all
adjournments thereof. This proxy statement and the accompanying proxy card are
first being sent to shareholders on or about March 25, 1999. Only holders of
record of the Company's common stock at the close of business on February 26,
1999 are entitled to notice of and to vote at the Annual Meeting. On that date,
709,825,206 shares of common stock were outstanding, each of which entitles the
holder to one vote on each matter to come before the meeting.
The bylaws of the Company provide that proxies, ballots and voting
tabulations that identify individual shareholders will be kept confidential
except as may be necessary to meet applicable legal requirements. Information
that identifies individual shareholders is available for examination only by the
judge of election and persons associated with an independent third-party
tabulator.
The principal executive offices of the Company are at 51 West 52nd Street,
New York, New York 10019.
1. ELECTION OF DIRECTORS
(Item 1 on proxy card)
At the 1999 Annual Meeting of Shareholders, 10 directors are to be elected
to hold office until the 2000 Annual Meeting of Shareholders in accordance with
the Company's bylaws. The Board of Directors of the Company (the "Board")
proposes for election George H. Conrades, Martin C. Dickinson, William H. Gray
III, Mel Karmazin, Jan Leschly, David T. McLaughlin, Richard R. Pivirotto,
Raymond W. Smith, Paula Stern and Robert D. Walter, all of whom are now
directors of the Company. One current director of the Company, Robert E.
Cawthorn, is not standing for re-election at the 1999 Annual Meeting. The Board
wishes to thank Mr. Cawthorn for his dedication and service to the Company. As a
result of the decision of Mr. Cawthorn not to stand for re-election, the Board
has determined to reduce the size of the Board, effective at the Annual Meeting,
to 10 members.
Information about the nominees is set forth on pages 5 through 9.
The persons named in the enclosed proxy card (Messrs. McLaughlin, Karmazin
and Briskman) have advised that, unless a contrary direction is indicated on the
proxy card, they intend to vote for the election of the proposed nominees. They
have also advised that in the event any one or more of the 10 nominees is not
available for election, they will vote for the election of such substitute
nominee or nominees, if any, as the Board may propose. In lieu of proposing a
substitute nominee, the Board may reduce the number of directors in accordance
with the bylaws of the Company.
4
<PAGE> 7
NOMINEES PROPOSED BY THE BOARD OF DIRECTORS
- -------------------------------------------
[PHOTO] GEORGE H. CONRADES, 60
Partner
Polaris Venture Partners (venture capital)
Waltham, Massachusetts
Since August 1998, Mr. Conrades has been a partner with Polaris Venture
Partners, specializing in early stage information technology and health
sciences. Mr. Conrades has broad experience in the computer, internet and
telephony industries beginning in 1961 when Mr. Conrades joined International
Business Machines (IBM) and subsequently as he held a number of management
positions in the United States and Asia. Mr. Conrades left IBM in 1992 as senior
vice president and a member of the Corporate Management Board. In 1994, he was
named president and chief executive officer of BBN Corporation, a leading
provider of internet services, products and application solutions, and in 1995
was appointed chairman of the board. In 1997, in connection with GTE
Corporation's acquisition of BBN Corporation, Mr. Conrades joined GTE
Corporation as executive vice president and as president of its new internet
organization, GTE Internetworking, leaving GTE Corporation in 1998. Mr. Conrades
is a director of Infinity Broadcasting Corporation, a subsidiary of CBS, Cubist
Pharmaceuticals, Inc. and Concentra Managed Care, Inc. He is also a trustee of
The Scripps Research Institute and Ohio Wesleyan University, and is a member of
the interim Board of ICANN, the non-profit corporation being established to
oversee the administration of internet names and addresses. Mr. Conrades was
first elected to the CBS Board in 1994.
[PHOTO] MARTIN C. DICKINSON, 63
Retired Senior Vice President
Scripps Bank (banking)
La Jolla, California
Mr. Dickinson joined Scripps Bank in La Jolla, California in 1988. From 1991
until his retirement in 1996, he was senior vice president and a senior credit
officer of Scripps Bank. Prior to joining Scripps Bank, Mr. Dickinson was senior
vice president for La Jolla Bank & Trust. Mr. Dickinson is a director of Scripps
Bank and chairman of the compensation committee, a director of Gaylord
Entertainment Company and chairman of the audit committee, and a director of the
Oklahoma Publishing Company. He is also chairman of The Scripps Foundation for
Medicine and Science and a member of the Board of Trustees for the National
Cowboy Hall of Fame and Western Heritage. Mr. Dickinson joined the CBS Board in
March 1998.
5
<PAGE> 8
[PHOTO] WILLIAM H. GRAY III, 57
President and Chief Executive Officer
The College Fund/UNCF (higher education assistance)
Fairfax, Virginia
Mr. Gray has been president and chief executive officer of The College Fund/UNCF
since 1991. From 1979 until 1991, he was a member of the United States House of
Representatives and served as house majority whip. Mr. Gray is a director of
Warner-Lambert Company, The Prudential Insurance Company of America, Union
Pacific Corporation, MBIA, Inc., Rockwell International Corporation, Electronic
Data Systems Corporation and The Chase Manhattan Bank, N.A. Mr. Gray was first
elected to the CBS Board in 1991.
[PHOTO] MEL KARMAZIN, 55
President and Chief Executive Officer
CBS Corporation
Chairman, President and Chief Executive Officer
Infinity Broadcasting Corporation
New York, New York
Mr. Karmazin was elected chief executive officer of CBS Corporation in January
1999, having served as president and chief operating officer of the Company
since April 1998. Mr. Karmazin is also chairman, president and chief executive
officer of Infinity Broadcasting Corporation, a subsidiary of CBS. Mr. Karmazin
joined CBS in December 1996 as chairman and chief executive officer of CBS
Radio. In May 1997, he also assumed responsibility for CBS' owned television
stations and became chairman and chief executive officer of the CBS Station
Group. Prior to joining the Company, he was president and chief executive
officer of Infinity Broadcasting Corporation from 1981 until its acquisition by
the Company in December 1996. Mr. Karmazin is a director of Infinity
Broadcasting Corporation and Westwood One, Inc., and a member of the Board of
Trustees for the Museum of Television and Radio. Mr. Karmazin was first elected
to the CBS Board in 1997.
6
<PAGE> 9
[PHOTO] JAN LESCHLY, 58
Chief Executive
SmithKline Beecham (healthcare)
Philadelphia, Pennsylvania
Mr. Leschly joined SmithKline Beecham as chairman of its Worldwide
Pharmaceutical business in 1990 and became chief executive in April 1994. Prior
to joining SmithKline Beecham, he served as president and chief operating
officer of Squibb Corporation, a pharmaceutical company. Mr. Leschly is a
director of SmithKline Beecham and American Express. Mr. Leschly was first
elected to the CBS Board in January 1998.
[PHOTO] DAVID T. MCLAUGHLIN, 66
Chairman of the Board
CBS Corporation
Chairman and Chief Executive Officer
Orion Safety Products (consumer safety products)
Easton, Maryland
Mr. McLaughlin became chairman of the Board of CBS Corporation in January 1999.
Since 1988, Mr. McLaughlin has served as chairman and chief executive officer of
Orion Safety Products (formerly Standard Fusee Corporation). From 1987 to 1988,
Mr. McLaughlin was chairman of The Aspen Institute and was appointed president
and chief executive officer in 1988. Upon his retirement from The Aspen
Institute in 1997, he was named president emeritus. From 1981 to 1987, Mr.
McLaughlin served as president of Dartmouth College. From 1970 to 1981, Mr.
McLaughlin served in various management positions at The Toro Company, being
named chairman and chief executive officer in 1977. In addition to Orion Safety
Products, Mr. McLaughlin is a director of Atlantic Richfield Company, Atlas Air,
Inc., and PartnerRe Ltd. Mr. McLaughlin was first elected to the CBS Board in
1979.
7
<PAGE> 10
[PHOTO] RICHARD R. PIVIROTTO, 68
President
Richard R. Pivirotto Co., Inc. (management consulting)
Greenwich, Connecticut
Mr. Pivirotto is president of Richard R. Pivirotto Co., Inc., a management
consulting firm. Mr. Pivirotto served as chairman of Associated Dry Goods
Corporation from 1976 until his retirement in 1981. He continued to serve on the
board of Associated Dry Goods until its acquisition by May Department Stores in
1986. Mr. Pivirotto is a director of Infinity Broadcasting Corporation, a
subsidiary of CBS, General American Investors Company, Inc., The Gillette
Company, New York Life Insurance Company, Immunomedics, Inc., The Greenwich Bank
and Trust Company and Yale New Haven Health System. He is also a trustee
emeritus of Princeton University, a trustee of the General Theological Seminary
and a trustee and past chairman of the Greenwich Hospital Association. Mr.
Pivirotto was first elected to the CBS Board in 1973.
[PHOTO] RAYMOND W. SMITH, 61
Chairman
Rothschild North America Inc. (international
investment banking)
New York, New York
Mr. Smith became chairman of Rothschild North America Inc. in January 1999.
Prior to that he was chairman and chief executive officer of Bell Atlantic
Corporation, a position he held since January 1989. He joined the Bell System in
1959. Mr. Smith also currently holds the position of chairman of Bell Atlantic
Venture Fund, Inc. He serves as a director of US Airways Group, Inc., and is a
trustee of the Lincoln Center Theater and Carnegie Mellon University. In 1995,
he was appointed to the President's Committee on the Arts and Humanities. In
1996, he became a member of the National Education Association's CEO Forum on
Education and Technology and a member of the Board of Trustees of the Greater
Washington Educational Telecommunications Association, Inc. Mr. Smith was first
elected to the CBS Board in 1997.
8
<PAGE> 11
[PHOTO] PAULA STERN, 53
President
The Stern Group, Inc. (economic analysis and trade
advisory services)
Washington, D.C.
Since 1988, Dr. Stern has been president of The Stern Group, Inc., a
Washington-based trade and international economic advisory firm. From 1972 to
1988, Dr. Stern held various positions with the United States government,
including commissioner and then chairwoman of the U.S. International Trade
Commission. She is a director of Infinity Broadcasting Corporation, a subsidiary
of CBS, Avon Products, Inc., Harcourt General and Wal-Mart Stores, Inc. Dr.
Stern was first elected to the CBS Board in 1992.
[PHOTO] ROBERT D. WALTER, 53
Chairman and Chief Executive Officer
Cardinal Health, Inc. (healthcare services provider)
Dublin, Ohio
Mr. Walter is the founder, chairman and chief executive officer of Cardinal
Health, Inc. Since 1971, through internal growth and acquisitions, he has built
Cardinal into one of the country's leading healthcare services providers with
annual sales in 1998 of approximately $16 billion. Mr. Walter is a director of
Infinity Broadcasting Corporation, a subsidiary of CBS, Cardinal Health, Inc.,
Bank One Corporation and Karrington Health, Inc. Mr. Walter was first elected to
the CBS Board in 1994.
9
<PAGE> 12
THE BOARD OF DIRECTORS AND ITS COMMITTEES
In 1998, there were 17 meetings of the Board. Each director attended at
least 75% of all meetings of the Board and its committees on which the director
served. Consistent with CBS' long-standing practice and its bylaws, a majority
of the members of the Board are independent as defined in the Company's bylaws.
At the present time, there are 11 members of the Board.
CBS has five standing Board committees: the Audit Review Committee, the
Compensation Committee, the Finance Committee, the Nominating and Governance
Committee, and the Public Policy Committee. All the members of these committees
are independent directors.
The Audit Review Committee assists the Board in fulfilling its
responsibilities concerning the Company's accounting and financial reporting
practices and the ethical conduct of the Company and its employees. This
committee makes recommendations to the Board regarding the selection, retention
or termination of the Company's independent auditors and reviews the
professional services, proposed fees and independence of such auditors. This
committee also reviews with management and the independent auditors both the
controls established to protect the integrity of the quarterly reporting process
and the Company's annual financial statements. The Audit Review Committee, whose
current members are directors Pivirotto (Chair), Cawthorn, Dickinson, Gray and
Stern, met three times in 1998.
The Compensation Committee assists the Board in establishing appropriate
compensation and benefits for the Company's directors, officers and employees.
This committee's general responsibilities include advising the Board on
compensation matters, evaluating and approving the compensation of the chief
executive officer and other executive officers of the Company and reporting to
the shareholders on executive compensation. This committee also reviews and
makes recommendations concerning outside director compensation and administers
annual incentives for key employees and the Company's long-term incentive plans.
The Compensation Committee, whose current members are directors Conrades
(Chair), Leschly, Smith and Walter, met three times in 1998.
The Finance Committee was established in late 1998 to assist management in
establishing and adhering to a financial strategy consistent with and supportive
of the overall business strategy of the Company. The Finance Committee, whose
current members are directors Walter (Chair), Dickinson and Leschly, held its
first meeting in January 1999.
The Nominating and Governance Committee makes recommendations to the Board
concerning the recruitment and selection of the chief executive officer and
Board candidates. This committee also reviews the Company's position on
significant corporate governance issues and recommends changes to the Board as
appropriate. In addition, this committee assesses the performance of the Board,
reviews the size and composition of the Board and its committees, and makes
appropriate recommendations. The Nominating and Governance Committee, whose
current members are directors Smith (Chair), Conrades, Gray, Pivirotto and
Walter, met four times in 1998.
The Public Policy Committee oversees the Company's government relations
programs at the federal, state and local levels, reviews the Company's policies
regarding environmental, health and safety matters and addresses other public
policy matters important to the Company. The Public Policy Committee, whose
current members are directors Stern (Chair), Cawthorn, Dickinson and Leschly,
met twice in 1998.
In 1994, the Board adopted guidelines identifying its policies with respect
to significant corporate governance matters. These guidelines, as amended over
the years, include a statement of the mission of the Board of Directors and the
structure by which it operates. They also outline responsibilities of the Board
in such areas as the selection and evaluation of the chief executive officer and
assessment of Board performance. If you would like to have a copy of these
guidelines, please contact the Secretary's Office and a copy will be sent to
you.
10
<PAGE> 13
A shareholder may recommend a Board candidate for consideration by the
Nominating and Governance Committee by furnishing to the Secretary a resume of
the experience and qualifications of the proposed candidate and a written
statement signed by the proposed candidate consenting to be nominated for
election to the Board and to serve if elected. A shareholder may appear at the
2000 Annual Meeting of Shareholders to nominate a candidate or to propose other
business to be considered by the shareholders (other than pursuant to a
shareholder proposal included in the proxy materials sent by the Company) by
sending a notice to the Secretary at the principal executive offices of CBS for
receipt between January 5, 2000 and February 4, 2000 setting forth the
information required by the Company's bylaws.
DIRECTOR COMPENSATION
Directors who are employees of the Company are not compensated for service
on the Board. During 1998, non-employee directors received an annual director's
fee of $80,000 paid as follows: $30,000 in cash; $25,000 in restricted shares of
the Company's common stock; and $25,000 in CBS stock options. The annual
director's fee is subject to forfeiture on a prorata basis in the event that a
75% attendance requirement is not met. The stock-based portion of the annual
director's fee is subject to mandatory holding periods, and the exercise price
on the stock options is set at the fair market value of CBS common stock on the
grant date. Directors who were elected as committee chairs in May 1998 received
a committee chair's fee of $5,000, paid in restricted shares of CBS common
stock. Prorated committee chair fees were paid to directors who became committee
chairs later in the year. Non-employee directors may also receive a $1,200 per
diem fee in cash for special services outside the scope of normal Board and
committee activities. No such fees were paid in 1998. Non-employee directors
were able to defer all or a portion of their cash fees. Director deferrals
receive interest at the one-year U.S. Treasury Bill rate or such other rate as
the Compensation Committee may determine, reset every January. For 1998, the
interest rate was set at the one-year U.S. Treasury Bill rate. Deferrals are
paid in five annual installments upon termination of service as a director.
In April 1996, the Board terminated the Advisory Director's Plan (a plan
that provided post-retirement payments to non-employee directors who retired at
age 70 with at least five years of Board service), and provided for a
termination payment to the then current non-employee directors with at least one
year of Board service (including directors Cawthorn, Conrades, Gray, McLaughlin,
Pivirotto, Stern and Walter). The termination payment was based on the then
present value of the 1995 annual retainer amount of $22,000 times the number of
years of Board service (up to 10 years) at the plan termination date. All of
these amounts were deferred, on terms substantially the same as 1996 director
deferrals (with the director receiving interest on the principal amount of the
deferral at the 10-year U.S. Treasury Bond rate plus an amount reflecting
appreciation, if any, in the price of the Company's common stock over the
deferral period), and will be paid in cash installments after the director
leaves the Board.
Also in April 1996, the Board terminated the Director's Charitable Giving
Program as to any director who did not have at least one full year of service at
the end of July 1996. Directors Cawthorn, Conrades, Gray, McLaughlin, Pivirotto,
Stern and Walter and Mr. Jordan continue to participate in this program. Under
this program, upon the death of an eligible director, the Company will make a
donation of $500,000 to a single qualifying charitable or other non-profit
organization, or a donation of $250,000 to each of two such organizations,
selected by that director. The donations are funded with the proceeds of life
insurance maintained on the directors. Individual directors derive no financial
benefit from this program since all charitable deductions accrue solely to the
Company.
The Company provides each non-employee director with accidental death and
dismemberment insurance in the principal amount of $500,000. Benefits will be
paid under this insurance if a covered event occurs while the director is on CBS
business. The total annual cost to the Company of this insurance for all
non-employee directors in 1998 was approximately $9,000.
11
<PAGE> 14
The Company also maintains a gift-matching program for directors. Under
this program, the Company will match director contributions to eligible
charitable or educational institutions. The maximum match per year is $2,000.
In the event of a change in control of the Company, director stock options
and restricted stock will vest, the value of any deferrals will be paid to a
trustee or otherwise on such terms as the Compensation Committee may determine,
and donations under the Charitable Giving Program may be made as of the date of
such change in control and paid on such basis and in such form as the committee
administering that program may prescribe.
RELATED PARTY TRANSACTIONS
In December 1998, the Company's wholly-owned subsidiary, Infinity
Broadcasting Corporation ("Infinity"), completed an initial public offering of
18.2% of its common stock. In connection with this offering, the Company entered
into an intercompany agreement with Infinity pursuant to which the Company
provides Infinity with a number of services, including human resources, legal,
finance, information management, internal audit, tax, treasury and executive
services (including the chief executive officer). The costs of these services
are allocated according to established methodologies determined by the Company
on an annual basis. In addition, a tax sharing agreement generally provides
that, for any taxable period in which Infinity is included in the Company's
consolidated tax return, Infinity will pay to the Company an amount equal to the
amount of income taxes Infinity would have paid if Infinity had filed separate
income tax returns. Reference is made to the full text of these agreements,
copies of which have been filed with the Securities and Exchange Commission.
12
<PAGE> 15
SECURITY OWNERSHIP
The following table sets forth the number of shares of common stock of the
Company and of the Class A common stock of Infinity beneficially owned as of
January 7, 1999 (except as otherwise noted) by each director, by each of the
executive officers named in the Summary Compensation Table on page 15 (the
"named executive officers"), and by the directors and executive officers of the
Company as a group as reported by each such person. Each person has sole voting
and investment power over the shares reported except as noted. No other equity
securities of the Company or its subsidiaries were beneficially owned, directly
or indirectly, by any director, named executive officer or other executive
officer on January 7, 1999.
<TABLE>
<CAPTION>
Amount and Nature of
Amount and Nature of Beneficial Ownership
Beneficial Ownership Percent Infinity Percent
Name CBS Common Stock of Class Class A Common Stock of Class
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
L. J. Briskman 451,652 shares(1) * 0 shares *
R. E. Cawthorn 24,193 shares(3)(4)(5) * 0 shares *
G. H. Conrades 34,835 shares(2)(3)(4)(5) * 20,000 shares *
M. C. Dickinson 217,623 shares(4)(5)(6)(7) * 2,000 shares(9) *
W. H. Gray III 20,219 shares(2)(3)(4)(5) * 1,000 shares *
M. H. Jordan 2,809,067 shares(1) * 0 shares *
M. Karmazin 8,149,764 shares(1)(6) 1.1% 50,000 shares *
J. Leschly 20,393 shares(4)(5) * 15,000 shares *
D. T. McLaughlin 43,153 shares(2)(3)(4)(5) * 200 shares *
L. Moonves 828,087 shares(1)(7) * 30,000 shares *
R. R. Pivirotto 26,356 shares(2)(3)(4)(5) * 1,000 shares *
F. G. Reynolds 739,335 shares(1)(7) * 45,000 shares *
R. W. Smith 11,146 shares(4)(5) * 20,000 shares *
P. Stern 21,720 shares(2)(3)(4)(5) * 1,000 shares *
R. D. Walter 69,507 shares(2)(3)(4)(5) * 20,000 shares *
All directors and
executive officers
as a group 13,496,569 shares(2)(3)(5)(6)(7)(8) 1.9% 206,200 shares(9) *
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
* Represents less than 1% of the class.
(1) Includes the following shares which the indicated named executive
officers had the right to acquire within 60 calendar days through the
exercise of stock options or warrants: Briskman 449,400; Jordan
2,760,862; Karmazin 3,916,867; Moonves 806,666; and Reynolds 720,833.
(2) Includes the following common stock equivalents owned by the indicated
directors under the Company's Deferred Compensation and Stock Plan for
Directors: Conrades 418; Gray 1,521; McLaughlin 3,209; Pivirotto
3,209; Stern 1,183; and Walter 103.
(3) The indicated directors have deferred all or part of their cash
compensation. As a result of these deferrals, at a future date, these
directors will be entitled to receive the following number of shares,
which are reflected in the table, or cash for all or part thereof:
Cawthorn 3,323; Conrades 6,663; Gray 6,501; McLaughlin 21,446;
Pivirotto 9,993; Stern 6,533; and Walter 3,021.
(4) Includes the following shares which the indicated directors had the
right to acquire within 60 calendar days through the exercise of stock
options: Cawthorn 8,169; Conrades 8,919; Dickinson 1,171; Gray 8,169;
Leschly 1,803; McLaughlin 8,919; Pivirotto 8,919; Smith 3,699; Stern
8,169; and Walter 8,169.
13
<PAGE> 16
(5) Includes the following shares which the indicated directors acquired
after January 7, 1999: 305 restricted shares granted to Mr. Cawthorn
and 732 restricted shares granted to each of the other indicated
non-employee directors as part of their 1999 director compensation; 49
restricted shares and 86 restricted shares granted to Messrs. Smith
and Walter, respectively, as prorated committee chair fees for
assuming chairmanship of certain Board committees during the year; and
3,000 shares purchased by Mr. Conrades.
(6) Includes 50,000 shares held in a trust for which Mr. Dickinson is
co-trustee; and 2,184,003 shares as to which Mr. Karmazin has voting
power but no investment power.
(7) The following shares, which are included in the Security Ownership
table for the indicated named executive officer or director, are owned
by family members: Mr. Dickinson 2,101 shares; Mr. Moonves 500 shares;
and Mr. Reynolds 110 shares. Each indicated officer or director
disclaims beneficial ownership of these shares.
(8) Includes 8,750,067 shares which the directors and executive officers
had the right to acquire within 60 calendar days through the exercise
of stock options or warrants.
(9) Includes 1,000 shares which are owned by Mr. Dickinson's spouse. Mr.
Dickinson disclaims beneficial ownership of these shares.
Except as set forth below, CBS does not know of any person who beneficially
owns more than 5% of the Company's common stock.
<TABLE>
<CAPTION>
Shares of
Name and Address CBS Common Stock Percent
Beneficial Owner Beneficially Owned of Class
---------------- ------------------ --------
<S> <C> <C>
FMR Corp.
82 Devonshire Street 70,550,588 9.99%*
Boston, MA 02109
*This percentage is based on the number of shares of CBS common stock
reported to the Company as beneficially owned as of December 31, 1998.
</TABLE>
14
<PAGE> 17
EXECUTIVE COMPENSATION
The following table sets forth information with respect to the compensation
for services to the Company and its subsidiaries in 1998, 1997 and 1996 of the
chief executive officer and each of the other four most highly compensated
executive officers of the Company at the end of 1998.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
All Other
Annual Compensation Long-Term Compensation Compensation
----------------------------------------- ---------------------------------- -------------
Awards Payouts
----------------------- -------
Restricted Securities LTIP
Name and Other Annual Stock Underlying Pay-
Principal Position Year Salary Bonus Compensation Awards Options(2) outs
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
M. H. Jordan 1998 $1,000,000 $1,000,000(1) $82,505(3) 0 350,000 0 $6,020,147(4)
Chairman & Chief 1997 $1,000,000 $2,000,000 $57,795 0 0 0 $ 110,309
Executive Officer 1996 $1,000,000 $1,000,000 N/A 272,813 1,100,000 0 $ 19,702
M. Karmazin 1998 $1,000,000 $3,000,000(1) N/A 0 250,000 0 $2,004,294(4)
President & Chief 1997 $ 925,000 $3,000,000 N/A 0 500,000 0 $ 3,749
Operating Officer 1996 N/A N/A N/A N/A N/A N/A N/A
L. Moonves 1998 $2,500,000 $1,500,000(1) N/A 0 0 0 $ 145,700(4)
President & Chief 1997 $2,596,153 $1,557,692 N/A 0 870,000 0 $ 141,700
Executive Officer, 1996 $2,500,000 $1,500,000 N/A 0 80,000 0 $ 143,200
CBS Television
F. G. Reynolds 1998 $ 647,000 $ 500,000(1) N/A 0 100,000 0 $ 549,143(4)
Executive VP & 1997 $ 585,516 $1,000,000 N/A 0 0 0 $ 71,003
Chief Financial 1996 $ 421,670 $ 750,000 N/A 0 550,000 0 $ 301,942
Officer
L. J. Briskman 1998 $ 395,000 $ 500,000(1) N/A 0 90,000 0 $ 120,318
Executive VP & 1997 $ 346,648 $ 350,000 N/A 0 200,000 0 $ 4,800
General Counsel 1996 $ 308,496 $ 320,000 N/A 0 60,000 0 $ 7,938
- ------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents annual incentive compensation awarded for 1998.
(2) Represents grants of non-qualified stock options.
(3) The amount shown in this column consists of (i) an $8,000 annual
perquisite allowance and (ii) $74,505 for non-business use of the
corporate aircraft, for which Mr. Jordan received imputed income.
(4) The amounts shown in this column consist of: (i) contributions by the
Company to savings program accounts for Messrs. Jordan, Moonves,
Reynolds and Briskman; (ii) under the terms of his employment
agreement, Mr. Moonves receives $18,000 annually to offset benefits he
was receiving from his former employer; (iii) relocation allowance of
$42,500 for Mr. Reynolds and moving and relocation allowance of
$12,797 for Mr. Briskman; (iv) $17,647, $2,643 and $3,915 of interest
earned during 1998 on deferred amounts of long-term incentive
compensation for Messrs. Jordan, Reynolds and Briskman, respectively;
(v) imputed income of $4,294 and $123,700, respectively, for Messrs.
Karmazin and Moonves with respect to executive life insurance; (vi)
$6,000,000 that will be paid to Mr. Jordan under the terms of his
employment agreement in connection with leaving the Company; and (vii)
for Messrs. Karmazin, Reynolds and Briskman, special awards in the
amount of $2,000,000, $500,000 and $100,000, respectively, to
acknowledge their significant contributions during 1998 beyond that
reflected by specific performance goals. One-half of the awards to
each of Messrs. Karmazin and Reynolds was subject to mandatory
deferral. These deferred amounts are
15
<PAGE> 18
held for the officer in a deferral account and credited with
appreciation as follows: for one-half of Mr. Karmazin's deferral, at a
rate equal to the increase, if any, in the Infinity Class A common
stock price, and at a rate equal to the increase, if any, in the
Company's common stock price as to the remainder for Mr. Karmazin; and
as to Mr. Reynolds' deferral, at a rate equal to the increase, if any,
in the Company's common stock price. These deferred amounts will be
paid beginning in the January following termination of service in one,
five, 10 or 15 annual installments, as the officer elects prior to
termination of service. In the event of a change in control of the
company, the value of any unpaid deferred amounts (including deferrals
from prior years) are paid to a trustee or otherwise on such terms as
the company's compensation committee may prescribe or permit.
OPTION GRANTS
The following table shows grants in 1998 of stock options to the named
executive officers.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
% of Total
Options Grant Date
Granted to Present Value(2)
Options Employees in Exercise or Expiration
Name Granted(1) Fiscal Year Base Price Date Per Share Total
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
M. H. Jordan ........... 350,000 4.1% $29.8125 01/26/08 $15.21 $5,323,500
M. Karmazin ........... 250,000 2.9% $29.8125 01/26/08 $15.21 $3,802,500
L. Moonves ........... 0 N/A N/A N/A N/A N/A
F. G. Reynolds ........... 100,000 1.2% $29.8125 01/26/08 $15.21 $1,521,000
L. J. Briskman ........... 90,000 1.0% $29.8125 01/26/08 $15.21 $1,368,900
- -------------------------------------------------------------------------------------------------------------
</TABLE>
(1) All stock options were granted to the named executive officers on
January 27, 1998. All stock options were granted in tandem with
limited rights. Options have a term of 10 years from the date of grant
or such lesser term as may be determined by the Compensation
Committee. The exercise price under each option may not be less than
the fair market value of the Company's common stock on the option
grant date. Except in the event of a change in control of the Company,
generally an option becomes exercisable in thirds, beginning after the
first, second, and third anniversaries of the grant date. Limited
rights are exercisable only in the event of a change in control of the
Company and during the 30 days immediately following such change and
only when the fair market value on the exercise date exceeds the
exercise price. When a limited right is exercised, the employee is
entitled to receive in cash the difference between the exercise price
of the related option and the greater of (i) the highest closing sales
price of the common stock on the New York Stock Exchange (the "NYSE")
during the 60 days prior to exercise, or (ii) the highest price paid
for the common stock in the change in control transaction during such
period. Reload options are granted to employees at the time of an
exercise of a stock option through a Stock Swap (payment of the
exercise price by surrender of previously owned shares of common
stock), unless the Compensation Committee cancels the reload feature
before such exercise. The reload option is granted for the number of
shares the employee tenders to pay the exercise price of the related
option.
(2) These values were derived using the following common assumptions:
stock price volatility 31%; dividend yield 0.67%; interest rate
5.683%; reload premium 10%; risk of forfeiture discount 5.9%; and for
each option, its full term and exercise price. There were no
adjustments made for non-transferability. The values and assumptions
were based on the Black-Scholes option pricing model. The actual
value, if any, that an executive officer may realize from stock
options (assuming that they are exercised) will depend solely on the
gain in stock price over the exercise price when the shares are sold.
16
<PAGE> 19
OPTION EXERCISES AND FISCAL YEAR-END VALUES
The following table provides information as to stock options to purchase
the Company's common stock exercised during 1998 by the named executive
officers; the unexercised options to purchase the Company's common stock
(including options granted in 1998 and prior years) owned by the named executive
officers; and the value of options held by them at year-end.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
Number of Securities
Shares Underlying Unexercised Value of Unexercised
Acquired Options at Fiscal Year-End Options at Fiscal Year-End(1)
on Value -------------------------- -----------------------------
Name Exercise Realized Exercisable Unexercisable(2) Exercisable Unexercisable(2)
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
M. H. Jordan............. 0 N/A 2,760,862 0 $35,453,753 0
M. Karmazin.............. 6,178,985 $195,934,379 3,833,534 250,000 $77,268,877 $ 750,000
L. Moonves............... 0 N/A 806,666 193,334 $ 9,411,036 $1,643,339
F. G. Reynolds........... 100,000 $ 2,156,190 687,500 250,000 $10,409,000 $2,113,875
L. J. Briskman........... 73,890 $ 1,194,664 419,400 90,000 $ 6,641,098 $ 270,000
- --------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Based on the closing price of the Company's common stock as reported
on the NYSE composite tape on December 31, 1998 ($32.8125).
(2) These options are unexercisable because they have not yet vested under
their terms.
PENSION BENEFITS
Effective January 1, 1998, each of the named executive officers, except
Messrs. Karmazin and Moonves, began to participate in the Group W component of
the CBS Combined Pension Plan (the "Pension Plan"). Prior to that date, they
participated in the Westinghouse Pension Plan, which has substantially similar
terms. During 1998, Mr. Moonves participated in the CBS component of the CBS
Combined Pension Plan (the "CBS Pension Plan"), which is discussed on pages 18
and 19. Mr. Karmazin has a vested benefit under an Infinity pension plan which
was frozen in November 1987. He has not accrued any additional benefits under
this plan since November 1987. As of December 31, 1998, the estimated monthly
benefit amount payable to Mr. Karmazin upon retirement at normal retirement age
under this frozen pension plan is $1,408.
The Pension Plan is a contributory, defined benefit plan designed to
provide retirement income related to an employee's salary and years of active
service. All Company contributions are actuarially determined. Messrs. Jordan,
Reynolds and Briskman also participate in the Westinghouse Executive Pension
Plan (the "Executive Pension Plan"), which provides for supplemental pension
payments provided that they meet certain eligibility requirements. Such
payments, when added to their pensions under the Pension Plan, result in a total
annual pension equal to 1.47% for each year of credited service multiplied by
their average annual compensation as defined by the Executive Pension Plan.
Average annual compensation is equal to the sum of the average of the five
highest annualized December base salaries and the average of the five highest
annual incentive awards, each in the last 10 years of employment. In the event
of retirement prior to age 60, the total annual pension would be reduced by an
amount equal to the reduction in the benefits payable under the Pension Plan. In
the event of a change in control of the Company, participants in the Executive
Pension Plan become vested and benefits may be paid on a present value or other
basis.
17
<PAGE> 20
For purposes of illustration, the following table indicates the approximate
amounts of annual retirement income that would be payable at the present time
under various assumptions as to average annual compensation and years of service
to employees who participate in the Pension Plan and are eligible for
supplemental payments pursuant to the Executive Pension Plan.
<TABLE>
<CAPTION>
Five-year
average annual Estimated annual pension for
compensation specified years of credited service
including -------------------------------------------------------------------------------------------------
incentive award 15 20 25 30 35 40
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
$ 300,000 $ 66,150 $ 88,200 $ 110,250 $ 132,300 $ 154,350 $ 176,400
500,000 110,250 147,000 183,750 220,500 257,250 294,000
700,000 154,350 205,800 257,250 308,700 360,150 411,600
900,000 198,450 264,600 330,750 396,900 463,050 529,200
1,100,000 242,550 323,400 404,250 485,100 565,950 646,800
1,500,000 330,750 441,000 551,250 661,500 771,750 882,000
2,000,000 441,000 588,000 735,000 882,000 1,029,000 1,176,000
2,500,000 551,250 735,000 918,750 1,102,500 1,286,250 1,470,000
3,000,000 661,500 882,000 1,102,500 1,323,000 1,543,500 1,764,000
3,500,000 771,750 1,029,000 1,286,250 1,543,500 1,800,750 2,058,000
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
The amounts presented in the above table are based on straight life annuity
amounts and are not subject to any reduction for Social Security benefits or
other offset amounts. As of December 31, 1998, Messrs. Jordan, Reynolds and
Briskman had the following credited full years of service under the Pension
Plan, respectively: five years; four years; and 23 years.
Mr. Moonves participates in the CBS Pension Plan, which is a
non-contributory defined benefit plan. The CBS Pension Plan is designed to
provide retirement income related to an employee's salary and years of active
service. In addition to the benefits provided by the CBS Pension Plan, Mr.
Moonves participates in an unfunded plan that provides for the payment of
benefits in excess of amounts permitted to be paid by tax-qualified benefit
plans under Internal Revenue Service regulations (the "Unfunded Plan"), as well
as the Supplemental Executive Retirement Plan ("SERP"). The SERP is an unfunded
plan that provides for recognition for pension purposes of 50% of certain annual
bonus amounts (for purposes of the SERP, such bonuses are defined as "SERP
Bonuses").
The applicable benefit payable under the CBS Pension Plan and the Unfunded
Plan is the sum of: 1.3% of Final Average Compensation up to the Social Security
covered compensation base times years of credited service (not to exceed 35)
plus 1.7% of Final Average Compensation in excess of the Social Security covered
compensation base times years of service (not to exceed 35). Benefits under the
CBS Pension Plan vest after a participant completes five years of service (as
defined). Final Average Compensation is the average of the participant's highest
five consecutive years of earnings out of the last 10 years of service. Earnings
include only regular compensation (i.e., the amount shown in the Salary column
in the Summary Compensation Table) and exclude overtime, bonuses, deferred
compensation and additional compensation of any kind.
The SERP benefit is based on 50% of annual SERP Bonus payments. SERP
Average Compensation is 50% of the average of the participant's highest SERP
Bonuses paid for five consecutive years out of the last
18
<PAGE> 21
10 years of continuous service. To determine the SERP annual benefit, SERP
Average Compensation is multiplied by 1.7%, and the resulting product is
multiplied by years of service (not to exceed 35). SERP benefits are payable
only to "retirement-eligible" participants, i.e., employees designated to
participate in the SERP and each of whom, upon termination of employment, has
attained age 55 with not less than 10 years of service (as defined).
For purposes of illustration, the following table shows the estimated
amounts of annual retirement income that would be payable at the present time
under various assumptions as to compensation and years of service to employees
who participate in the CBS Pension Plan, the Unfunded Plan and the SERP.
<TABLE>
<CAPTION>
Base salary plus
50% of the average
of five highest Estimated annual pension for specified years of credited service
consecutive ---------------------------------------------------------------------------------------
bonuses received 5 10 15 20 25 30 35
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 367,500 $ 24,877 $ 61,230 $ 91,845 $ 122,460 $ 153,075 $ 183,690 $ 214,305
496,000 33,377 83,075 124,612 166,150 207,687 249,225 290,762
620,000 41,877 104,155 156,232 208,310 260,387 312,465 364,542
744,000 50,377 125,235 187,852 250,470 313,087 375,705 438,322
868,000 58,877 146,315 219,472 292,630 365,787 438,945 512,102
992,000 67,377 167,395 251,092 334,790 418,487 502,185 585,882
1,170,000 75,877 197,655 296,482 395,310 494,137 592,965 691,792
1,300,000 84,377 219,755 329,632 439,510 549,387 659,265 769,142
1,430,000 92,877 241,855 362,782 483,710 604,637 725,565 846,492
1,560,000 101,377 263,955 395,932 527,910 659,887 791,865 923,842
1,690,000 109,877 286,055 429,082 572,110 715,137 858,165 1,001,192
1,820,000 118,377 308,155 462,232 616,310 770,387 924,465 1,078,542
1,950,000 126,877 330,255 495,382 660,510 825,637 990,765 1,155,892
2,600,000 169,377 440,755 661,132 881,510 1,101,887 1,322,265 1,542,642
3,250,000 211,877 551,255 826,882 1,102,510 1,378,137 1,653,765 1,929,392
3,900,000 254,377 661,755 992,632 1,323,510 1,654,387 1,985,265 2,316,142
4,550,000 296,877 772,255 1,158,382 1,544,510 1,930,637 2,316,765 2,702,892
- --------------------------------------------------------------------------------------------------------------
</TABLE>
The amounts presented in the above table are based on straight life annuity
amounts and are not subject to any reduction for Social Security benefits or
other offset amounts. As of December 31, 1998, Mr. Moonves had three credited
fully years of service under the CBS Pension Plan, the Unfunded Plan and the
SERP.
19
<PAGE> 22
COMPENSATION AND SEVERANCE ARRANGEMENTS
MICHAEL H. JORDAN
In June 1993, the Company retained the services of Michael H. Jordan as
chairman and chief executive officer of the Company. Pursuant to the employment
agreement entered into at that time, the Company agreed that, upon termination,
Mr. Jordan would receive a supplemental pension benefit under the Westinghouse
Executive Pension Plan with no actuarial reduction for commencement of that
benefit prior to age 65, and Mr. Jordan's vested stock options would remain
exercisable for the remainder of their respective terms. The employment
agreement also provides for separation benefits in the event that Mr. Jordan
leaves the Company under certain circumstances.
Mr. Jordan retired as chairman and chief executive officer of the Company
effective as of December 31, 1998, although he will remain available for
consultation through completion of the divestiture of the Company's industrial
businesses and the remainder of 1999. In connection with leaving the Company,
under his employment agreement, Mr. Jordan will receive a lump-sum payment of
$6,000,000, credit for an additional two years of service with respect to his
supplemental pension benefit, and certain health and welfare benefits and his
previously unvested stock options were vested.
MEL KARMAZIN
In June 1996, the Company and Mel Karmazin entered into an employment
agreement that became effective at the time of the acquisition of Infinity by
the Company. The employment agreement is for a term of four years commencing at
the effective time of the acquisition (December 31, 1996) and provides for a
starting annual base salary of $925,000, subject to merit review and annual
increases (but not decreases) at the sole discretion of the Compensation
Committee. The employment agreement further provides that Mr. Karmazin will have
the opportunity to receive performance-based annual incentive bonuses with a
target award opportunity of $1,500,000. Mr. Karmazin also received a stock
option grant pursuant to the agreement on the acquisition date for 500,000
shares of Company common stock, with the options generally becoming exercisable
after the first and second anniversaries of the grant date.
The employment agreement provides that Mr. Karmazin's employment is
terminable for cause upon the occurrence of any (i) action involving willful
malfeasance or gross misconduct in connection with such employment having a
material adverse effect on the Company, (ii) substantial and continuing refusal
to perform ordinary duties of a chief executive officer or (iii) felony
conviction.
In the event Mr. Karmazin's employment is terminated without cause or the
Company otherwise breaches the employment agreement, the Company would be
obligated to pay to Mr. Karmazin a lump-sum payment equal to the compensation,
including annual incentive compensation, that otherwise would have been paid to
Mr. Karmazin for the remainder of the term of the employment agreement.
LESLIE MOONVES
As of May 17, 1995, CBS Broadcasting Inc. (formerly CBS Inc.), prior to
being acquired by the Company in late 1995, retained the services of Leslie
Moonves as President, CBS Entertainment Division, for a five-year term beginning
July 17, 1995 and ending July 16, 2000. The Company and Mr. Moonves entered into
an amendment to the 1995 agreement in connection with Mr. Moonves' promotion to
the position of President, CBS Television and his assumption of additional
responsibilities in mid-1997.
20
<PAGE> 23
Mr. Moonves' employment agreement provides for an annual base salary of
$2,500,000 and annual bonus payments of $1,500,000 for each year of the
contract. He also receives a monthly payment of $1,500 to offset certain
benefits from his former employer that he lost when he was retained by CBS
Broadcasting.
Under the agreement, in the event that CBS Broadcasting terminates Mr.
Moonves for incapacity, CBS Broadcasting will continue to pay Mr. Moonves his
base salary and bonus (less the maximum amount that may be insured under the CBS
Broadcasting Long-Term Disability Plan) for the remainder of the employment
term. If CBS Broadcasting terminates Mr. Moonves' employment for a reason other
than cause or incapacity, or if Mr. Moonves elects to terminate the contract for
good reason as defined in the contract (which includes removal from his title or
position and certain changes in his reporting responsibilities, authority and
functions), Mr. Moonves will be entitled to continue to receive his base salary
and bonus payments for the remainder of the employment term in lieu of any other
severance benefits. In the event of a change of control of CBS Broadcasting
during the period Mr. Moonves is rendering services under the employment
agreement, Mr. Moonves is entitled to receive a change of control payment that
varies in amount depending on the remaining term of the employment agreement and
the change of control consideration.
In connection with the amendment to his employment contract and assumption
of additional responsibilities in mid-1997, Mr. Moonves received grants of stock
options for 500,000 shares of Company common stock at an exercise price of
$21.75, exercisable after one year, and for 290,000 shares of Company common
stock at an exercise price of $24.31, becoming exercisable in increments over
three years. In the event that CBS Broadcasting terminates Mr. Moonves'
employment for a reason other than cause or incapacity, or if Mr. Moonves elects
to terminate the contract for good reason as defined in the contract, these
options will vest as of their normal vesting dates and will then be exercisable
until the earlier of three years from his separation date or the expiration of
the option term.
FREDRIC G. REYNOLDS
Pursuant to a March 1999 agreement, in the event of termination by the
Company without cause or by Mr. Reynolds for good reason (as defined), Mr.
Reynolds is entitled to receive separation pay in the amount of two times base
salary and annual incentive target award opportunity, and his stock options
would continue to vest and would remain exercisable for two years after
separation.
LOUIS J. BRISKMAN
Pursuant to a March 1999 agreement, Mr. Briskman is entitled to receive
separation pay, in the event of termination by the Company without cause or by
Mr. Briskman for good reason (as defined), in the amount of two times base
salary and annual incentive target award opportunity, and his stock options
would continue to vest and would remain exercisable for the remainder of their
terms. In addition, upon such separation, or upon retirement on or after his
earliest retirement age, Mr. Briskman would receive a supplemental executive
pension at the same level as the current Westinghouse Executive Pension Plan,
with no actuarial reduction for commencement of supplemental pension prior to
age 65.
OTHER COMPENSATION
The Board has determined that employees receiving payments pursuant to
provisions of certain compensation or other employee benefit plans relating to a
change in control of the Company should not be adversely affected by any tax
imposed on such payments by reason of Section 4999 of the Internal Revenue Code
of 1986, as amended, and has authorized and directed the Company in such event
to make additional payments in an amount sufficient to satisfy any such tax
liability.
21
<PAGE> 24
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors of the Company has
furnished the following report on executive compensation for 1998.
The Compensation Committee, which is composed entirely of outside
independent directors, reviews, evaluates and approves the design and
implementation of the Company's compensation system for executive officers. The
Compensation Committee also determines the form and amount of compensation for
the chief executive and other executive officers. For purposes of making
compensation determinations, the Compensation Committee evaluates the
competitiveness of the Company's executive compensation and evaluates individual
and Company performance.
THE CBS EXECUTIVE COMPENSATION PROGRAM
The CBS executive compensation program is a performance and rewards
compensation system consisting of base salaries and incentives (annual and
long-term) that pays executives for the achievement of levels of performance
designed to increase the shareholder value of the Company. The system also
enables the Company to hire, retain and motivate high-quality executives who
meet the immediate business challenges and improve the long-term performance of
the Company, and is designed to pay base salaries and provide total compensation
opportunities which are competitive as measured against industry norms.
The Compensation Committee reviews and evaluates competitive data for
purposes of establishing base salary and annual incentive opportunities and for
making long-term incentive grants, using information from a variety of sources.
These sources include information supplied by consultants, various industry
surveys, and information obtained from the Company's own experience. For
example, for purposes of measuring competitive base salary and annual incentive
opportunities, the Compensation Committee uses, among other sources, the Towers
Perrin entertainment and general industry surveys as appropriate. For purposes
of measuring competitive long-term incentive opportunities, the Compensation
Committee uses, among other sources, surveys conducted by Towers Perrin.
The individual performance of each executive officer is annually reviewed
and evaluated. Individual contributions are evaluated on the basis of
comparative, organization-wide assessments of contributions.
BASE SALARIES
Executive officers are assigned a compensation range for base salaries
which takes into consideration the level of responsibility involved, the
knowledge and skill required, and competitive levels. Each year, the executive's
performance is evaluated and any base salary adjustment is based on an
evaluation of the individual's performance and contribution and on competitive
data. The chief executive officer makes recommendations with respect to salary
adjustments for all executive officers. These recommendations are reviewed by
the Compensation Committee and approved with any modifications the Committee
deems appropriate.
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<PAGE> 25
ANNUAL INCENTIVES
The Compensation Committee administers various incentive plans under which
annual incentive compensation may be paid to key employees of the Company,
including the Company's 1998 Executive Annual Incentive Plan (the "1998 Plan")
approved by the shareholders at the 1998 Annual Meeting, which allows the
Compensation Committee to structure performance-based awards to covered
executives so as to comply with the requirements of Section 162(m) of the
Internal Revenue Code of 1986, as amended, and the regulations promulgated
thereunder for deductibility of certain executive compensation. Under these
plans, early in 1998, the Compensation Committee approved competitive annual
incentive award opportunities for individual executive officers. The
Compensation Committee established a range of 1998 financial objectives for the
entire Company and for each individual business unit and established other key
performance indicators as appropriate. The Committee established specific EBITDA
performance goals under the 1998 Plan for covered executives (all of the named
executive officers other than Mr. Moonves, who receives his annual incentive
under a pre-existing individual employment agreement).
The year 1998 reflects strong performance by the Company's executive
officers. After reviewing the performance of the Company in light of specific
performance goals previously established by the Compensation Committee, the
Committee approved the payment of awards to covered executives under the 1998
Plan.
After reviewing the relevant financial and other key performance indicators
and individual performance, the chief executive officer made recommendations
with respect to incentive awards. These recommendations were reviewed with and,
to the extent determined appropriate, approved by the Compensation Committee.
LONG-TERM INCENTIVES
Long-term incentives are a significant component of total compensation. For
a number of years, the Compensation Committee has awarded long-term incentives
to executive officers in the form of stock options as part of the Company's
performance-based incentive compensation, thus rewarding the officers when
shareholder value increases. The Compensation Committee believes that using
stock options as an incentive serves to promote a sense of ownership and to
further align the interests of the Company's executive officers with those of
its shareholders, for the options have value only as the Company's stock price
increases.
For 1998, the Compensation Committee again granted long-term incentive
opportunities to executive officers in the form of non-qualified stock option
grants. The level of option grants to executives for 1998 was based on the
above-referenced competitive data for the executive's level of responsibility
and on individual performance. The number of shares currently owned, directly
and through various deferral arrangements by an executive, was not a factor in
determining the final grant level. All stock option grants to executive officers
in 1998 had an exercise price per share equal to the fair market value of the
Company's common stock on the grant date.
COMPENSATION ARRANGEMENTS
From time to time, the Company enters into employment contracts or other
compensation arrangements with executive officers when appropriate for
competitive or other business reasons. In these cases, compensation for the
executives is paid in accordance with their contracts. Contractual compensation
arrangements with individual executive officers named in the Summary
Compensation Table are summarized on pages 20 and 21.
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<PAGE> 26
SPECIAL 1998 AWARDS
After reviewing and evaluating Company and executive performance for 1998,
the Compensation Committee noted that a number of significant goals had been
achieved during the year the impact of which went substantially beyond that
reflected by specific performance goals. These actions included substantial
completion of the transformation of the Company to a pure media enterprise, and
significant steps in reduction of the Company's indebtedness, enhancement of its
debt rating and increase in its stock price. Based on these significant
contributions, special awards of $2,000,000, $500,000 and $100,000 were approved
for Messrs. Karmazin, Reynolds and Briskman, respectively. Based on Mr.
Karmazin's contributions to these achievements in his role as chief executive
officer of Infinity, a subsidiary of the Company, $1,000,000 of the special
award to Mr. Karmazin was allocated to Infinity. Fifty percent of the special
awards to each of Messrs. Karmazin and Reynolds was subject to mandatory
deferral.
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Individual Performance and Contribution. Total compensation for Michael H.
Jordan, the chairman and chief executive officer of the Company during 1998, was
based on a variety of factors as discussed below. A significant factor which was
taken into account by the Compensation Committee, however, was the full Board's
detailed evaluation of Mr. Jordan's performance as chief executive officer and
his contribution to the Company and its shareholders in 1998.
Salary. The Compensation Committee reviewed Mr. Jordan's annual base salary
of $1,000,000. After consideration, the Compensation Committee determined that
this base salary should remain unchanged for 1998.
Bonus. As an annual incentive for 1998, the Compensation Committee awarded
Mr. Jordan a bonus of $1,000,000 under the 1998 Plan, taking into consideration
his compensation arrangements discussed below in "Other Compensation."
Long-term Incentive. Long-term incentives during 1998 consisted of a grant
of options for 350,000 shares of CBS common stock. Mr. Jordan's grant level was
established considering his level of responsibility, previously disclosed
competitive data and the Compensation Committee's evaluation of his performance
and role in increasing shareholder value.
Other Compensation. Mr. Jordan retired as chairman and chief executive
officer of the Company effective as of December 31, 1998, although he will
remain available for consultation through completion of the divestiture of the
Company's industrial businesses and the remainder of 1999. In connection with
leaving the Company, under his employment agreement, Mr. Jordan will receive a
lump-sum payment of $6,000,000, credit for an additional two years of service
with respect to his supplemental pension benefit, and certain health and welfare
benefits and his previously unvested stock options were vested.
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<PAGE> 27
POLICY ON DEDUCTIBILITY OF COMPENSATION
It is the Compensation Committee's policy to establish measurable,
quantifiable performance targets in connection with incentive plans as part of
the Company's performance and rewards compensation system for executive
officers. For example, in the case of stock options, the options only have value
as the Company's stock price increases. In the case of annual incentives, the
Compensation Committee establishes financial and non-financial performance
measures for that year's incentives that are designed to increase the
shareholder value of the Company.
Under the federal tax laws, beginning in 1994, compensation for certain
individual executive officers ("covered executives") is not deductible to the
extent that the officer's compensation for that year exceeds $1,000,000, after
excluding qualifying performance-based compensation that meets certain specified
criteria. The Compensation Committee believes, based on information currently
available, that the Company's annual incentive awards and stock options to its
covered executive officers (other than annual incentives to Mr. Moonves pursuant
to his pre-existing employment agreement) will qualify for exclusion. The
Compensation Committee has reviewed and will continue to review tax consequences
as well as other relevant considerations when making compensation decisions. The
Compensation Committee generally has required the deferral of compensation which
would exceed the $1,000,000 limit. However, the Compensation Committee has
excluded certain media operations executive officers from this requirement given
the structure of executive compensation in the media and entertainment industry
and certain pre-existing compensation arrangements.
COMPENSATION COMMITTEE
George H. Conrades, Chair
Jan Leschly
Raymond W. Smith
Robert D. Walter
Messrs. Conrades, Smith and Walter served as members of the Compensation
Committee during all of 1998, with Mr. Leschly joining the Committee in May
1998, Mr. Pivirotto leaving the Committee in May 1998, and Mr. McLaughlin
leaving the Committee in December 1998. All members of the Compensation
Committee were independent outside directors. During 1998, no Compensation
Committee interlocks or insider participation existed.
25
<PAGE> 28
SHAREHOLDER RETURN PERFORMANCE GRAPH
Set forth below is a line graph comparing the total returns (assuming
reinvestment of any dividends) of the Company's common stock, the Standard &
Poor's 500 Index ("S&P 500(R)"), and the Standard & Poor's Entertainment Index
("S&P(R) Entertainment").
COMPARISON OF FIVE-YEAR TOTAL RETURN*
CBS COMMON, S&P 500(R) AND S&P(R) ENTERTAINMENT
<TABLE>
<CAPTION>
DECEMBER 31,
-------------------------------------------------------------
1993 1994 1995 1996 1997 1998
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
CBS Corporation $100 $ 88 $119 $147 $219 $245
S&P 500(R) $100 $101 $139 $171 $229 $294
S&P(R) Entertainment $100 $ 95 $115 $116 $170 $230
</TABLE>
*Assumes that the value of the investment in CBS common stock and in each
index was $100 on December 31, 1993, and that any dividends were reinvested.
2. ELECTION OF INDEPENDENT AUDITORS
(Item 2 on proxy card)
Independent auditors are to be elected to audit and express an opinion on
the Company's financial statements for 1999. The Audit Review Committee of the
Board has the responsibility to recommend to the Board annually, and at other
appropriate times, the selection, retention or termination of the Company's
independent auditors. The Audit Review Committee has nominated KPMG LLP
("KPMG"), and this firm has advised the Company that it is willing to serve. The
Board has approved this nomination. If KPMG is not elected, or if elected, it
should subsequently decline to serve, or if its engagement by the Company is
terminated, the Board, in conjunction with the Audit Review Committee, will
appoint other independent auditors.
A representative of KPMG will be present at the 1999 Annual Meeting of
Shareholders and will have an opportunity to make a statement. He or she will
also respond to any appropriate questions.
26
<PAGE> 29
The persons named in the enclosed proxy card (Messrs. McLaughlin, Karmazin
and Briskman) have advised that they intend to vote for the election of KPMG
unless a contrary direction is indicated on the proxy card.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION
OF KPMG AS INDEPENDENT AUDITORS.
The affirmative vote of a majority of the votes cast by the shareholders is
required for passage.
3. SHAREHOLDER PROPOSAL: EXPAND EXECUTIVE COMPENSATION DISCLOSURE REQUIREMENTS
(Item 3 on proxy card)
CBS has been advised that Evelyn Y. Davis, the beneficial owner of 500
shares of common stock, located at Watergate Office Building, Suite 215, 2600
Virginia Avenue N.W., Washington, D.C. 20037, will submit the following proposal
at the meeting:
"RESOLVED: That the shareholders recommend that the Board take the
necessary steps that CBS specifically identify by name and corporate title in
all future proxy statements those executive officers, not otherwise so
identified, who are contractually entitled to receive in excess of $250,000
annually as a base salary, together with whatever other additional compensation
bonuses and other cash payments were due them."
SUPPORTING STATEMENT
In support of such proposed Resolution it is clear that the shareholders
have a right to comprehensively evaluate the management in the manner in which
the Corporation is being operated and its resources utilized. At present only a
few of the most senior executive officers are so identified, and not the many
other senior executive officers who should contribute to the ultimate success of
the Corporation. Through such additional identification the shareholders will
then be provided an opportunity to better evaluate the soundness and efficacy of
the overall management.
If you AGREE, please mark your proxy FOR this proposal.
THE RECOMMENDATION OF THE BOARD OF DIRECTORS
The Proposal seeks to impose on CBS more stringent disclosure requirements
than those already required of all companies by the Securities and Exchange
Commission (the "SEC"). CBS already provides shareholders with comprehensive and
detailed information on executive compensation - pages 15 through 25 of this
proxy statement are devoted to that very subject. The nature and extent of the
information disclosed is based, primarily, on the proxy solicitation rules
promulgated by the SEC, rules which apply to all publicly traded companies. The
Board of Directors believes that, under the existing disclosure requirements,
shareholders receive adequate information on which to base an informed
evaluation of the Company's use of resources for compensation, and that there is
no substantial shareholder interest to be served by imposing different standards
on CBS. Further, in the entertainment industry, there is relatively little
publicly available information on executive compensation other than that already
required by the SEC's existing rules and regulations. Expanding disclosure in
the way proponent suggests would potentially require CBS to make public far more
information than other companies in the entertainment industry and
27
<PAGE> 30
would clearly place CBS at a competitive disadvantage. In addition, the Company
treats each employee's salary as a private matter, except where disclosure is
required under SEC rules applicable to all companies, and the Board of Directors
believes that such privacy should continue to be respected.
The persons named in the enclosed proxy card (Messrs. McLaughlin, Karmazin,
and Briskman) have advised that they intend to vote against the proposed
resolution unless a contrary direction is indicated on the proxy card.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE AGAINST THE
PROPOSED RESOLUTION.
The affirmative vote of a majority of the votes cast by the shareholders on
this proposal is required for passage.
VOTING INFORMATION
Under Pennsylvania law and the Company's Restated Articles of Incorporation
and bylaws, the presence of a quorum is required to transact business at the
1999 Annual Meeting of Shareholders. A quorum is defined as the presence, either
in person or by proxy, of a majority of the votes that all shareholders are
entitled to cast at the meeting. Abstentions, votes withheld from director
nominees and broker-dealer non-votes will be counted for purposes of determining
a quorum.
Assuming the presence of a quorum, (i) the 10 nominees for director
receiving the highest number of votes will be elected directors and (ii) the
affirmative vote of a majority of the votes cast by the shareholders is required
for the election of independent auditors and for adoption of the shareholder
proposal.
Abstentions and broker-dealer non-votes are not counted in determining the
numbers of votes cast in connection with the election of independent auditors or
adoption of the shareholder proposal. While abstentions and broker-dealer
non-votes are not cast and therefore do not count either for or against the
election of independent auditors or adoption of the shareholder proposal, they
do have the practical effect of reducing the number of affirmative votes
required to achieve majority in each of these matters.
SHAREHOLDER PROPOSAL SUBMISSIONS FOR 2000 ANNUAL MEETING OF SHAREHOLDERS
To be considered for inclusion in the proxy materials relating to the 2000
Annual Meeting of Shareholders, shareholder proposals should be addressed to the
Secretary and must be received at the principal executive offices of CBS on or
before November 24, 1999.
SOLICITATION OF PROXIES
This solicitation of proxies is made on behalf of the Board of Directors of
the Company. Solicitation will be by mail, except for any personal solicitation
made orally or in writing by or under the direction of directors, officers or
employees of CBS. The cost of solicitation, including the cost of any such
personal solicitation, will be paid by the Company. CBS may request persons such
as brokers, nominees and fiduciaries holding stock in their names to forward
proxy materials to the beneficial owners, and it will reimburse such persons for
their reasonable expenses incurred in doing so. In addition, CBS has retained
Georgeson & Company Inc., Wall Street Plaza, New York, New York 10005, for a fee
of $12,000 plus incidental and related expenses, to assist in providing proxy
materials to brokers, nominees, fiduciaries and individuals (other than officers
of the Company) holding sizable amounts of stock and in soliciting proxies from
them.
28
<PAGE> 31
A shareholder giving a proxy has the power to revoke the proxy by
delivering a later dated and signed proxy or written notice of revocation to the
Secretary prior to the time voting is declared closed or by attending the
meeting and voting in person. All proxies will be voted if properly signed,
received by the Secretary prior to the time voting is declared closed, and not
revoked prior to that time.
As of the time of preparation of this proxy statement, the Board knows of
no matter, other than those described in the foregoing paragraphs, that will be
presented at the 1999 Annual Meeting of Shareholders. However, if any other
matters properly come before the meeting or any adjournment thereof, the person
or persons voting the proxies will vote them in accordance with their best
judgment.
March 25, 1999
29
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This Page Intentionally Left Blank
<PAGE> 33
[CBS LOGO]
<PAGE> 34
ADMISSION TICKET
1999 ANNUAL MEETING
OF
SHAREHOLDERS
OF
CBS CORPORATION
TUESDAY, MAY 4, 1999
10:30 A.M.
SHERATON NEW YORK HOTEL
811 SEVENTH AVENUE (AT 52ND STREET)
NEW YORK, NEW YORK
DETACH PROXY CARD HERE
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR ITEMS 1 AND 2, AND
AGAINST ITEM 3.
- --------------------------------------------------------------------------------
1. Election of directors
(see reverse)
FOR WITHHOLD FOR ALL, WITH
ALL [ ] FOR ALL [ ] EXCEPTIONS [ ]
BELOW
*Exceptions: ________________________________
(INSTRUCTIONS: To withhold authority to vote for any individual nominee(s), mark
the exceptions box and write the name(s) in the space provided above.)
2. The Election of Independent Auditors.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
3. Shareholder Proposal: Expand Executive Compensation
Disclosure Requirements.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
The shares represented by this Proxy Card will be voted as specified above, but
if no specification is made they will be voted FOR items 1 and 2 and AGAINST
Item 3 and at the discretion of the proxies on any other matter that may
properly come before the meeting.
If you receive more than one Annual Report at the address set forth on this
proxy and have no need for the extra copy, please check the box at the right.
This will not affect the distribution of proxy statements or any other
mailings. [ ]
To change your address mark this box and correct on reverse side.[ ]
If you plan to attend the Annual Meeting please check this box. [ ]
NOTE: Please sign exactly as name appears hereon.
Joint owners should each sign. When signing as
attorney, executor, administrator, trustee or
guardian, give full name and title as such.
-------------------------------------------------
Signature of Share Owner(s)
-------------------------------------------------
Signature of Share Owner(s)
Dated: , 1999
----------------------
VOTES MUST BE INDICATED [X] IN BLACK OR BLUE INK.
Please sign, date and return promptly in the accompanying envelope.
<PAGE> 35
(reverse of card)
----------------------------------------------------------------------
DETACH PROXY CARD HERE
CBS CORPORATION
Proxy solicited by the Board of Directors for Annual Meeting of
Shareholders, May 4, 1999
(see Proxy Statement for discussion of items.)
The undersigned hereby appoints David T. McLaughlin, Mel Karmazin and Louis J.
Briskman, and each of them, jointly and severally, as proxies, with power of
substitution, to vote all shares of CBS Corporation common stock which the
undersigned is entitled to vote on all matters which may properly come before
the 1999 Annual Meeting of Shareholders of CBS Corporation, or any adjournment
thereof.
<TABLE>
<CAPTION>
<S> <C>
- ------------------------------------------------------------------------- -----------------------------
ELECTION OF DIRECTORS. NOMINEES: (change of address)
George H. Conrades, Martin C. Dickinson, William H. Gray III, Mel -----------------------------
Karmazin, Jan Leschly, David T. McLaughlin, Richard R. Pivirotto, -----------------------------
Raymond W. Smith, Paula Stern and Robert D. Walter. -----------------------------
-----------------------------
If you have written in the
above space, please mark the
corresponding box on the
reverse side of this card.
- ------------------------------------------------------------------------- -----------------------------
</TABLE>
CBS Corporation
P.O. Box 11004
New York, N.Y. 10203-0004
You are encouraged to specify you choices by marking the appropriate boxes on
the reverse side. The proxies cannot vote your shares unless you sign and return
this proxy card.
(Continued, and to be signed and dated, on the reverse side.)
