SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
CONRAIL INC.
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(Name of Issuer)
Common Stock, Par Value $1.00 Per Share
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(Title of Class of Securities)
208368 10 0
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(CUSIP Number)
Series A ESOP Convertible Junior Preferred Stock, Without Par Value
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(Title of Class of Securities)
N/A
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(CUSIP Number)
James D. McGeehan Robert A. Kindler, Esq.
Corporate Secretary Cravath, Swaine & Moore
Conrail Inc. Worldwide Plaza
2001 Market Street 825 Eighth Avenue
Philadelphia, Pennsylvania 19101 New York, New York 10019
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(Name, Address and Telephone Number of Persons
Authorized to Receive Notices and Communications)
October 14, 1996
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(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule
13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4),
check the following box |_|.
Note: Six copies of this statement, including all exhibits,
should be filed with the Commission. See Rule 13d- 1(a) for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to the
subject class of securities, and for any subsequent amendment
containing information which would alter disclosures provided in a
prior cover page.
The information required on the remainder of this cover page
shall not be deemed to be "filed" for the purpose of Section 18 of the
Securities Exchange Act of 1934 ("Act") or otherwise subject to the
liabilities of that section of the Act but shall be subject to all
other provisions of the Act (however, see the Notes).
(Continued on following pages)
(Page 1 of 9 Pages)
Page 1 of 9 Pages
<PAGE>
CUSIP NO. 208368 10 0 13D Page 2 of 9 Pages
1 NAME OF REPORTING PERSON
Conrail Inc.
S.S. or I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
23-2728514
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP * (a)|_|
(b)|_|
3 SEC USE ONLY
4 SOURCE OF FUNDS *
WC, BK, OO
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEMS 2(D) OR 2(E) |_|
6 CITIZENSHIP OR PLACE OF ORGANIZATION
Pennsylvania
7 SOLE VOTING POWER
NUMBER OF 43,090,773 1
SHARES
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY None
EACH
REPORTING 9 SOLE DIPOSITIVE POWER
PERSON WITH 43,090,773 1
10 SHARED DISPOSITIVE POWER
None
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
43,090,773 1
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES * |_|
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
16.6% 2
14 TYPE OF REPORTING PERSON *
CO
* SEE INSTRUCTIONS BEFORE FILLING OUT
<PAGE>
1 The shares of common stock of CSX Corporation (the "Issuer")
covered by this report are purchasable by Conrail Inc.
("Conrail") upon exercise of an option (the "Option") granted to
Conrail pursuant to the CSX Corporation Stock Option Agreement
dated as of October 14 , 1996 (the "CSX Stock Option Agreement"),
and described in Item 4 of this report. Prior to the exercise of
the Option, Conrail is not entitled to any rights as a
shareholder of the Issuer as to the shares covered by the Option.
The number of shares of common stock of the Issuer purchasable by
Conrail under the Option, which is initially set to equal
43,090,773 shares, will be adjusted if necessary so that the
number of shares purchasable by Conrail upon exercise of the
Option at the time of its exercise is equal to 19.9% of the total
outstanding shares of common stock of the Issuer at the time of
such exercise. The Option may only be exercised upon the
happening of certain events, none of which has occurred as of the
date hereof. Prior to such exercise, Conrail expressly disclaims
beneficial ownership of the shares of common stock of the Issuer
which are purchasable by Conrail upon exercise of the Option.
The number of shares indicated represents approximately 19.9% of
the total outstanding shares of common stock of the Issuer as of
October 14, 1996, excluding shares issuable upon exercise of the
Option.
2 Adjusted to reflect the issuance by the Issuer of 43,090,773
shares of common stock of the Issuer upon exercise of the Option
as described herein.
Page 3 of 9 Pages
<PAGE>
Item 1. Security and Issuer
This Schedule 13D relates to the common stock, par value $1.00
per share (the "Common Stock," an individual share of which is a
"Share"), of CSX Corporation, a Virginia corporation (the "Issuer").
The principal executive offices of the Issuer are located at One James
Center, 901 East Cary Street, Richmond, Virginia 23219.
Item 2. Identity and Background
This Schedule 13D is filed by Conrail Inc. ("Conrail"), a
Pennsylvania corporation engaged in the business of providing freight
transportation services within the northeast and midwest United
States. Conrail interchanges freight with other United States and
Canadian railroads for transport to destinations within and outside
Conrail's service region. Conrail serves a heavily industrial region
that is marked by dense population centers which constitute a
substantial market for consumer durable and non-durable goods, and a
market for raw materials used in manufacturing and by electric
utilities. Conrail's principal offices are located at 2001 Market
Street, Philadelphia, Pennsylvania 19101.
During the last five years, to the best of Conrail's knowledge,
neither Conrail nor any of its executive officers or directors has
been convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors) or has been a party to a civil proceeding of
a judicial or administrative body of competent jurisdiction resulting
in a judgment, decree or final order enjoining future violations of,
or prohibiting or mandating activities subject to, federal or state
securities laws, or finding any violation with respect to such laws.
All executive officers and directors of Conrail are citizens of
the United States. The name, business address and present principal
occupation (including the name and address of the corporation or
organization in which such employment is conducted) of each executive
officer and director is set forth in Schedule A to this Schedule 13D
and is specifically incorporated herein by reference.
Item 3. Source and Amount of Funds or Other Consideration
This Statement relates to an option granted to Conrail by the
Issuer to purchase shares of Common Stock from the Issuer as described
in Item 4 below (the "Option"). The Option entitles Conrail to
purchase 43,090,773 Shares (the "Option Shares") under the
circumstances specified in the CSX Corporation Stock Option Agreement
dated as of October 14, 1996, between Conrail and the Issuer (the "CSX
Corporation Stock Option Agreement") and as described in Item 4 below,
for a purchase price of $64.82 per Share (the "Purchase Price"). The
number of Option Shares will be adjusted if necessary so that the
number of shares purchasable by Conrail upon exercise of the Stock
Option at the time of its exercise is equal to 19.9% of the total
outstanding shares of common stock of the Issuer at the time of
exercise. Reference is hereby made to the CSX Corporation Stock Option
Agreement, which is included as Exhibit (c)(3) to the Tender Offer
Statement on Schedule 14D-1 filed by the Issuer on October 16, 1996
(the "Schedule 14D-1"), for the full text of its terms, including the
conditions upon which it may be exercised.
Page 4 of 9 Pages
<PAGE>
The Option was granted by the Issuer as an inducement to Conrail
to enter into the Agreement and Plan of Merger, dated as of October
14, 1996, by and among Conrail, Green Acquisition Corp., a
Pennsylvania corporation and a wholly owned subsidiary of the Issuer,
and the Issuer (the "Merger Agreement"). Pursuant to the Merger
Agreement and subject to the terms and conditions set forth therein
(including approval by the stockholders of Conrail and the Issuer and
various regulatory agencies), Conrail will merge with and into Green
Acquisition Corp. (the "Merger") with Green Acquisition Corp.
continuing as the surviving corporation, and each issued and
outstanding share of common stock of Conrail, par value $1.00 per
share, and Series A ESOP Convertible Junior Preferred Stock, without
par value, in each case other than those shares owned by Conrail, the
Issuer or any subsidiary of Conrail or the Issuer, will be converted
into the right to receive 1.85619 Shares. If the Merger is
consummated, the Option will not be exercised. No monetary
consideration was paid by Conrail to the Issuer for the Option.
If Conrail elects to exercise the Option, it currently
anticipates that the funds to pay the Purchase Price will be generated
by a combination of available working capital, bank or other
borrowings and/or the sale, in whole or in part, of Option Shares
following such exercise.
Item 4. Purpose of Transaction
As stated above, the Option was granted to Conrail in connection
with the execution of the Merger Agreement. A copy of the Merger
Agreement is included as Exhibit (c)(1) to the Schedule 14D-1, and is
incorporated herein by reference in its entirety. If the Merger is
consummated, the Board of Directors of the Issuer shall consist of the
current Chairman of the Issuer, the current Chairman of Conrail and an
even number of other Directors of whom 50% shall be designated by each
of Conrail and the Issuer.
Conrail has the right to cause the Issuer to prepare and file up
to three registration statements under the Securities Act of 1933, as
amended, in order to permit the sale by Conrail of any Option Shares
purchased under the Option.
The descriptions herein of the CSX Stock Option Agreement and the
Merger Agreement are qualified in their entirety by reference to such
agreements, copies of which were filed as Exhibits (c)(3) and (c)(1),
respectively, to the Schedule 14D-1.
Item 5. Interest in Securities of the Issuer
As a result of the issuance of the Option, Conrail may be deemed
to be the beneficial owner of 43,090,773 Shares, which would represent
approximately 16.6% of the Shares outstanding after exercise of the
Option (based on the number of Shares outstanding on October 14, 1996,
as set forth in the Merger Agreement). Conrail will have sole voting
and dispositive power with respect to such Shares.
The Option Shares described herein are subject to the Option,
which is not currently exercisable. Nothing herein shall be deemed to
be an admission by Conrail as to the beneficial ownership of any
Shares, and, prior to exercise of the Option, Conrail disclaims
beneficial ownership of all Option Shares.
Except as described herein, neither Conrail nor, to the best of
Conrail's knowledge, any other person referred to in Schedule A
attached hereto, beneficially owns or has acquired or disposed of any
Shares of the Issuer during the past 60 days.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Securities of the Issuer
Except for the Merger Agreement and the CSX Corporation Stock
Option Agreement, none of the persons named in Item 2 has any
contracts, arrangements, understandings or relationships (legal or
otherwise) with any persons with respect to any securities of the
Issuer, including, but not limited to, transfers or voting of any
securities, finder's fees, joint ventures, loan or option
arrangements, puts or calls, guarantees of profits, division of
profits or loss, or the giving or withholding of proxies.
Page 5 of 9 Pages
<PAGE>
Item 7. Materials to be Filed as Exhibits
Exhibit Description
1 CSX Corporation Stock Option Agreement, dated as
of October 14, 1996, between CSX Corporation, as
Issuer, and Conrail Inc., as Grantee (incorporated
by reference to Exhibit (c)(3) to the Tender Offer
Statement on Schedule 14D-1 on October 16, 1996
(the "Schedule 14D-1")).
2 Agreement and Plan of Merger, dated as of
October 14, 1996, among Conrail Inc., Green
Acquisition Corp. and CSX Corporation
(incorporated by reference from Exhibit (c)(1) to
the Schedule 14D-1).
Page 6 of 9 Pages
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this Schedule 13D
is true, complete and accurate.
October 22, 1996 CONRAIL INC.
By: /s/Bruce B. Wilson
---------------------------------
Name: Bruce B. Wilson
Title: Senior Vice President -- Law
Page 7 of 9 Pages
<PAGE>
SCHEDULE A
Names of Directors Principal Occupation Residence or Business
and Officers or Employment Address of Organization
- -------------------- ----------------------------- -----------------------
David M. LeVan Chairman, President and Chief Conrail Inc.
Director and Officer Executive Officer 2001 Market Street
Philadelphia, PA 19101
Cynthia A. Archer Senior Vice President - Conrail Inc.
Officer Intermodal Service Group 2001 Market Street
Philadelphia, PA 19101
Ronald J. Conway Senior Vice President - Conrail Inc.
Officer Operations 2001 Market Street
Philadelphia, PA 19101
Timothy P. Dwyer Senior Vice President - Unit Conrail Inc.
Officer Train Service Group 2001 Market Street
Philadelphia, PA 19101
Timothy T. O'Toole Senior Vice President - Conrail Inc.
Officer Finance 2001 Market Street
Philadelphia, PA 19101
Frank H. Nichols Senior Vice President - Conrail Inc.
Officer Organizational Performance 2001 Market Street
Philadelphia, PA 19101
John P. Sammon Senior Vice President - CORE Conrail Inc.
Officer Service Group 2001 Market Street
Philadelphia, PA 19101
George P. Turner Senior Vice President - Conrail Inc.
Officer Automotive Service Group 2001 Market Street
Philadelphia, PA 19101
Bruce B. Wilson Senior Vice President - Law Conrail Inc.
Officer 2001 Market Street
Philadelphia, PA 19101
Lucy S. L. Amerman Vice President - Risk Conrail Inc.
Officer Management 2001 Market Street
Philadelphia, PA 19101
Dennis A. Arouca Vice President - Conrail Inc.
Officer Labor Relations 2001 Market Street
Philadelphia, PA 19101
Page 8 of 9 Pages
<PAGE>
Names of Directors Principal Occupation Residence or Business
and Officers or Employment Address of Organization
- -------------------- ----------------------------- -----------------------
Gerald T. Gates Vice President - Customer Conrail Inc.
Officer Support 2001 Market Street
Philadelphia, PA 19101
Hugh J. Kiley Vice President - Service Conrail Inc.
Officer Design & Planning 2001 Market Street
Philadelphia, PA 19101
Craig R. MacQueen Vice President - Corporate Conrail Inc.
Officer Communications 2001 Market Street
Philadelphia, PA 19101
Donald W. Mattson Vice President - Controller Conrail Inc.
Officer 2001 Market Street
Philadelphia, PA 19101
John A. McKelvey Vice President - Conrail Inc.
Officer Service Delivery 2001 Market Street
Philadelphia, PA 19101
William B. Newman, Vice President and Connrail Inc.
Jr. Washington Counsel 2001 Market Street
Officer Philadelphia, PA 19101
Lester M. Passa Vice President - Logistics and Conrail Inc.
Officer Corporate Strategy 2001 Market Street
Philadelphia, PA 19101
Albert M. Polinsky Vice President - Information Conrail Inc.
Officer Systems 2001 Market Street
Philadelphia, PA 19101
John M. Samuels Vice President - Operating Conrail Inc.
Officer Assets 2001 Market Street
Philadelphia, PA 19101
Thomas J. McFadden Corporate Treasurer Conrail Inc.
Officer 2001 Market Street
Philadelphia, PA 19101
James D. McGeehan Corporate Secretary Conrail Inc.
Officer 2001 Market Street
Philadelphia, PA 19101
H. Furlong Baldwin Chairman and Chief Executive 2 Hopkins Plaza
Director Officer, Mercantile Bankshares 2nd Floor
Corporation Baltimore, MD 21201
Page 9 of 9 Pages
<PAGE>
Names of Directors Principal Occupation Residence or Business
and Officers or Employment Address of Organization
- -------------------- ----------------------------- -----------------------
Claude S. Brinegar Vice Chairman, Unocal Corp. P.O. Box 4346
Director Stanford, CA 94309
Daniel B. Burke Chairman and Owner, 77 West 66th Street
Director Portland, Maine Baseball Inc. New York, NY 10023
Kathleen Foley President, Economics Studies, 147 Clifton Street
Feldstein Inc. Belmont, MA 02178
Director
Roger S. Hillas Retired One Plymouth Meeting,
Director Suite 425
Plymouth Meeting, PA
19462
E. Bradley Jones Retired 30195 Chagrin Boulevard
Director Suite 104W
Pepper Pike, OH 44124
David B. Lewis Chairman, Lewis, Clay & 1300 First National
Director Munday, a Professional Building
Corporation 660 Woodward Avenue
Detroit, MI 48226
John C. Marous Retired 2210 PPG Place
Director Pittsburgh, PA 15222
Gail McGovern AT&T 295 N. Maple Avenue
Director Room 4345 L1
Basking Ridge, NJ 07920
Raymond T. Schuler Retired Boca Grande Club - 47B
Director 5001 Gasparilla Road
Boca Grande, FL 33921
David H. Swanson President and Chief Executive 950 North Meridian Street
Director Officer, Countrymark Indianapolis, IN 46204
Cooperative, Inc.
Page 10 of 9 Pages
