<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 2, 1997
REGISTRATION NO. 333-24051
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
------------------------
NORFOLK SOUTHERN CORPORATION
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
VIRGINIA 52-1188014
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
THREE COMMERCIAL PLACE
NORFOLK, VIRGINIA 23510-2191
(757) 629-2600
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
JAMES C. BISHOP, JR.
EXECUTIVE VICE PRESIDENT
NORFOLK SOUTHERN CORPORATION
THREE COMMERCIAL PLACE
NORFOLK, VIRGINIA 23510-2191
(757) 629-2600
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
------------------------------
COPIES TO:
<TABLE>
<S> <C>
J. GARY LANE, ESQ. VINCENT J. PISANO, ESQ.
NORFOLK SOUTHERN CORPORATION SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP
THREE COMMERCIAL PLACE 919 THIRD AVENUE
NORFOLK, VIRGINIA 23510-2191 NEW YORK, NY 10022
TEL: (757) 629-2600 TEL: (212) 735-3000
FAX: (757) 629-2607 FAX: (212) 735-2000
</TABLE>
------------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THE REGISTRATION STATEMENT.
------------------------------
If any of the securities being registered on this Form are to be offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434
please check the following box. /X/
------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
TITLE OF EACH CLASS AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM
OF SECURITIES TO BE TO BE OFFERING PRICE AGGREGATE
REGISTERED REGISTERED PER UNIT(1) OFFERING PRICE(2)
<S> <C> <C> <C>
Debt Securities.........................................
Preferred Stock(3)......................................
Depositary Shares(3)....................................
Common Stock(3)(4)......................................
Total............................................... $3,000,000,000 100% $3,000,000,000
<CAPTION>
TITLE OF EACH CLASS
OF SECURITIES TO BE AMOUNT OF
REGISTERED REGISTRATION FEE
<S> <C>
Debt Securities.........................................
Preferred Stock(3)......................................
Depositary Shares(3)....................................
Common Stock(3)(4)......................................
Total............................................... $909,091
</TABLE>
(1) In United States dollars or the equivalent thereof in any other currency or
currencies, currency unit or units, or composite currency or currencies.
Such amount represents the aggregate offering price of any combination of
the Debt Securities, Preferred Stock, Depositary Shares and Common Stock.
(2) Estimated for the sole purpose of computing the registration fee pursuant to
Rule 457(o) under the Securities Act of 1933.
(3) Also includes such indeterminate number of shares of Preferred Stock,
Depositary Shares and Common Stock as may be issued upon conversion of or
exchange for any Debt Securities, Preferred Stock or Depositary Shares that
provide for conversion or exchange into other securities. No separate
consideration will be received for the Preferred Stock, Depositary Shares
and Common Stock issuable upon conversion of or in exchange for Debt
Securities, Preferred Stock or Depositary Shares.
(4) The number of shares of Common Stock registered hereunder is limited to that
which is permissible under Rule 415(a)(4) of the Securities Act.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
Pursuant to Rule 429 under the Securities Act, this Registration Statement
contains a combined Prospectus that also relates to (I) $50,000,000 principal
amount of unissued debt securities previously registered pursuant to
Registration Statement on Form S-3 (File No. 33-38595) of Norfolk Southern
Corporation and (II) $1,250,000,000 principal amount of unissued Debt
Securities, Preferred Stock, Depositary Shares and Common Stock previously
registered pursuant to Registration Statement on Form S-3 (File No. 333-20203)
of Norfolk Southern Corporation. The filing fees associated with such securities
($12,500 for 33-38595 and $378,788 for 333-20203) were paid previously with each
such Registration Statement and are now being applied hereto. This Registration
Statement constitutes Post-Effective Amendment No. 2 to Registration Statement
on Form S-3 (File No. 33-38595) pursuant to which the total amount of unsold
debt securities previously so registered may be offered and sold as and in any
combination of Debt Securities, Preferred Stock, Depositary Shares and Common
Stock, without limitation as to class of securities, together with the
securities registered hereunder, through the use of the combined Prospectus
included herein. This Registration Statement also constitutes Post-Effective
Amendment No. 1 to Registration Statement on Form S-3 (File No. 333-20203) of
Norfolk Southern Corporation.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
SUBJECT TO COMPLETION--MAY , 1997
PROSPECTUS
[LOGO]
U.S. $4,300,000,000
NORFOLK SOUTHERN CORPORATION
DEBT SECURITIES, PREFERRED STOCK, DEPOSITARY SHARES
AND COMMON STOCK
--------------
Norfolk Southern Corporation (the "Corporation") directly, through agents
designated from time to time or through dealers or underwriters also to be
designated, may offer and issue from time to time (i) debt securities (the "Debt
Securities"), which may be either senior debt securities (the "Senior Debt
Securities") or subordinated debt securities (the "Subordinated Debt
Securities"), in one or more series; (ii) Preferred Stock, without par value
(the "Preferred Stock"), in one or more series, which may be issued in the form
of depositary shares (the "Depositary Shares") evidenced by depositary receipts
and (iii) Common Stock, par value $1.00 per share (the "Common Stock"), on terms
to be determined at the time of sale. The Common Stock is listed on the New York
Stock Exchange under the symbol "NSC." The Debt Securities, the Preferred Stock,
the Depositary Shares and the Common Stock are hereinafter collectively referred
to as the "Securities." The Securities that may be offered pursuant to this
Prospectus will be limited to an aggregate initial public offering price of up
to $4,300,000,000 or the equivalent thereof in one or more foreign currencies,
currency units or composite currencies.
The accompanying Prospectus Supplement will set forth specific terms of the
Securities, including (i) in the case of Debt Securities, specific designation
and denomination (which may be in United States dollars, or in any other
currency or currencies, currency unit or units or composite currency or
currencies), aggregate principal amount, rank, maturity, interest rate (or the
manner of calculation thereof), if any, and time of payment of interest,
purchase price, any terms for redemption, sinking funds, conversion or exchange
and any other specific terms of the Debt Securities; (ii) in the case of a
particular series of Preferred Stock, specific designation, aggregate number of
shares offered, dividend rate (or manner of calculation thereof), dividend
periods (or manner of calculation thereof), liquidation preference, voting
rights, any terms for redemption, whether and on what terms the shares of such
series may be converted into Common Stock at the option of the holder, whether
Depositary Shares representing shares of such series of Preferred Stock will be
offered and, if so, the fraction of a share of Preferred Stock represented by
each depositary share, listing, if any, on a securities exchange and any other
specific terms of such series of Preferred Stock; and (iii) in the case of
Common Stock, the number of shares offered and the purchase price therefor.
-------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
-------------------
If an agent of the Corporation or a dealer or underwriter is involved in the
sale of the Securities in respect of which this Prospectus is being delivered,
that agent's commission, dealer's purchase price or underwriter's discount is
set forth in, or may be calculated from, the accompanying Prospectus Supplement,
and the net proceeds to the Corporation from such sale will be the purchase
price of such Securities less such commission in the case of an agent, the
purchase price of such securities in the case of a dealer or the public offering
price less such discount in the case of an underwriter, and less, in each case,
the other related issuance expenses. The Corporation reserves the sole right to
accept and, together with its agents from time to time, to reject, in whole or
in part, any proposed purchase of Securities to be made directly or through
agents. Any underwriters, dealers or agents participating in an offering may be
deemed "underwriters" within the meaning of the Securities Act of 1933, as
amended (the "Act"). See "Plan of Distribution" for possible indemnification
arrangements for any agents, dealers or underwriters.
-------------------
<PAGE>
The date of this Prospectus is May , 1997.
<PAGE>
AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Reports, proxy
statements and other information filed by the Corporation can be inspected and
copied at the public reference facilities maintained by the Commission at Room
1024, 450 Fifth Street, N.W., Washington, D.C. 20549; Suite 1400, 500 West
Madison Street, Chicago, Illinois 60661; and Seven World Trade Center, 13th
Floor, New York, New York 10048. Copies of such material can be obtained by mail
from the Public Reference Section of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed fees. The Commission also maintains a
website that contains reports, proxy and information statements and other
information. The website address is http://www.sec.gov. Reports, proxy
statements and other information concerning the Corporation also may be
inspected at the offices of the New York Stock Exchange, 20 Broad Street, New
York, New York 10005, where the Corporation's Common Stock is listed.
The Corporation has filed with the Commission a registration statement on
Form S-3 under the Act which relates to the Securities (the "Registration
Statement"). As permitted by the rules and regulations promulgated by the
Commission, this Prospectus does not contain all the information set forth in
the Registration Statement and the exhibits and schedules thereto. For further
information with respect to the Corporation and the Securities, reference hereby
is made to the Registration Statement and to the exhibits and schedules filed
therewith. The Registration Statement may be inspected without charge by anyone
at the office of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549, and copies of all or any part thereof may be obtained from the Commission
upon payment of the prescribed fees. Statements contained in this Prospectus as
to the contents of any agreement, instrument or other document referred to
herein are not necessarily complete, and in each instance reference is made to
the full text of the copy of such document filed as an exhibit to the
Registration Statement or otherwise filed with the Commission. Each such
statement is qualified in its entirety by reference to the full text of each
such agreement, instrument or document.
-------------------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by the Corporation (File
No. 1-8339) are incorporated in this Prospectus by reference: (1) Annual Report
on Form 10-K for the fiscal year ended December 31, 1996, filed on March 27,
1997; (2) Current Report on Form 8-K dated February 5, 1997 and filed on
February 15, 1997; (3) Current Report on Form 8-K dated April 8, 1997 and filed
on April 10, 1997, as amended by Current Report on Form 8-K/A dated and filed on
May 1, 1997; and (4) Current Report on Form 8-K dated and filed on April 23,
1997.
All documents filed by the Corporation pursuant to Section 13(a), 13(c), 14
or 15(d) of the Exchange Act subsequent to the date of this Prospectus and prior
to the termination of the offering of the Securities shall be deemed to be
incorporated by reference in this Prospectus from the respective dates of filing
such documents. Any statement contained in this Prospectus or in a document all
or a portion of which is incorporated or deemed to be incorporated herein by
reference shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated herein
by reference modifies or supersedes such statement. Any statement so modified
shall not be deemed to constitute a part hereof except as so modified, and any
statement so superseded shall not be deemed to constitute a part hereof.
The Corporation will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus is delivered, upon the
written request of any such person, a copy of any or all of the foregoing
documents incorporated by reference herein, other than certain exhibits to such
documents. Requests should be directed to: NORFOLK SOUTHERN CORPORATION, THREE
COMMERCIAL PLACE, NORFOLK, VIRGINIA 23510-2191, ATTENTION: CORPORATE SECRETARY
(TELEPHONE NUMBER: (757) 629-2680).
2
<PAGE>
NORFOLK SOUTHERN CORPORATION
Norfolk Southern Corporation (the "Corporation") is a Virginia-based holding
company that owns all the common stock of and controls a major operating
railroad, Norfolk Southern Railway Company, and a diversified motor carrier,
North American Van Lines, Inc. ("NAVL"). The Corporation was incorporated in
July 1980 in the Commonwealth of Virginia. In June 1982, the Corporation
acquired control of Norfolk and Western Railway Company ("NW") and Southern
Railway Company ("Southern"). On December 31, 1990, all the common stock of NW
was transferred to Southern and Southern changed its name to Norfolk Southern
Railway Company ("NS Railway"). NS Railway controls NW. On June 21, 1985, the
Corporation acquired control of NAVL.
The Corporation's rail subsidiaries form a single interterritorial system,
extending over approximately 14,300 miles of road in twenty states, primarily in
the Southeast and Midwest, and the Province of Ontario, Canada. NAVL provides
household moving and specialized handling freight services in the United States
and Canada, and offers certain motor carrier services worldwide.
On April 8, 1997, the Corporation entered into an agreement (the
"Agreement") with CSX Corporation ("CSX") providing for a joint acquisition (the
"Joint Offer") of Conrail, Inc. ("Conrail"), pursuant to which the Corporation
and CSX jointly will acquire all outstanding Conrail Shares (as defined below)
not already owned by them for $115 in cash per share. Following the acquisition
of the Conrail Shares and receipt of all required regulatory approvals, most of
the assets and liabilities of Conrail are expected to be allocated between the
Corporation and CSX as described below. A copy of the Agreement is filed as an
exhibit to the Corporation's Current Report on Form 8-K dated April 8, 1997,
which is incorporated by reference herein. The Agreement followed several months
of attempts by each of the Corporation and CSX to acquire all of Conrail.
Conrail is the holding company that owns and controls Consolidated Rail
Corporation, a major freight railroad which provides freight transportation
services within the Northeast and Midwest.
On October 24, 1996, in response to the October 15, 1996 announcement that
Conrail had entered into a merger agreement with CSX, a wholly-owned subsidiary
of the Corporation commenced an all-cash tender offer for all outstanding shares
of Conrail's Common Stock and Series A ESOP Convertible Junior Preferred Stock
(collectively, the "Conrail Shares"), including in each case the associated
Common Stock Purchase Rights.
On February 10, 1997, the Corporation notified Conrail, pursuant to the
requirements of Conrail's By-laws, of its intention to conduct a proxy contest
in connection with Conrail's 1997 Annual Meeting of shareholders, currently
scheduled for December 19, 1997, seeking, among other things, to remove certain
of the current members of the Conrail Board and to elect a new slate of nominees
designated by the Corporation.
On February 11, 1997, pursuant to its tender offer as then amended, the
Corporation purchased 8,200,000 Conrail Shares (approximately 9.9 percent of the
then outstanding Conrail Shares), representing the approximate maximum number of
Conrail Shares that the Corporation could buy without triggering Conrail's
anti-takeover defenses, at a price of $115 per share, or $943 million in the
aggregate. The purchase was financed through issuance of commercial paper backed
by a portion of the revolving debt capacity under the credit facility obtained
in connection with the Corporation's proposed acquisition of Conrail.
On February 12, 1997, the Corporation commenced a second tender offer for
all of the remaining Conrail Shares at a price of $115 per share in cash.
Pursuant to an amendment to the merger agreement between CSX and Conrail
announced on March 7, 1997, CSX offered to purchase all Conrail Shares for $115
per share in cash and CSX was permitted to enter into negotiations with other
parties, including the Corporation, concerning the acquisition of the securities
or assets, or concessions relating to the assets or operations, of Conrail. The
3
<PAGE>
Corporation and CSX undertook negotiations with a view towards reaching a
comprehensive resolution of the issues confronting the eastern railroads based
on the proposal submitted by the Corporation to both CSX and Conrail on February
24, 1997.
On April 8, 1997, the Corporation and CSX issued a press release announcing
that they had entered into the Agreement providing for the joint acquisition of
Conrail. Under the terms of the Agreement, the Corporation and CSX jointly will
acquire all outstanding Conrail Shares not already owned by them for $115 in
cash per share. In connection therewith, the Corporation's tender offer to
acquire Conrail Shares was terminated and CSX's tender offer to acquire Conrail
Shares was amended, among other things, to include the Corporation as co-bidder
and to extend its expiration date to May 23, 1997. The Agreement and a number of
ancillary agreements must be approved by the Surface Transportation Board (the
"STB").
The estimated total purchase price of (i) the Conrail Shares to be acquired
pursuant to the Joint Offer and (ii) the Conrail Shares already acquired by the
Corporation and by CSX is approximately $10.2 billion, before the transaction
expenses of each of the parties. Pursuant to the Agreement, the Corporation will
bear 58% of that total purchase price (or approximately $5.9 billion, of which
$943 million has been expended previously to purchase the 8.2 million Conrail
Shares that the Corporation now owns) to acquire Conrail Shares and CSX will
bear 42% of such purchase price, in each case taking into consideration amounts
previously paid by each of them to acquire Conrail Shares. In addition, the
Agreement provides that, upon consummation of the Joint Offer and completion of
the second-step merger specified in the Agreement, and subject to regulatory
approval, specified assets and liabilities of Conrail will be allocated between
the Corporation and CSX pursuant to leasing, operating, partnership or other
arrangements to be negotiated and implemented between the Corporation and CSX,
and the remaining assets and liabilities of Conrail will be pooled and either
shared or allocated between the Corporation and CSX on a ratable basis in
accordance with the percentage of the total consideration paid (including
liabilities assumed) by the Corporation and CSX, 58% and 42%, respectively (such
acquisition by the Corporation of, or of the right to use, the assets allocated
to or shared by the Corporation pursuant to the Agreement and the assumption by
the Corporation of the obligations relating to liabilities allocated to or
shared by it pursuant to the Agreement, the "Transaction").
The Corporation and CSX intend to file a joint application with the STB in
June of 1997 seeking approval of the proposed acquisition and division of
Conrail. Conrail Shares purchased previously by the Corporation and CSX have
been, and Conrail Shares purchased in the Joint Offer will be, placed in a joint
voting trust pending STB approval. The approval of the STB, while expected,
cannot be assumed and is not likely to be obtained prior to April 1, 1998.
Following consummation of the Joint Offer, the Corporation expects to use the
equity method of accounting for its investment in Conrail.
The accounting treatment for the Corporation's investment in Conrail
subsequent to STB approval will be determined based upon the extent of control
that the Corporation and CSX will individually have over specific Conrail assets
and is expected to be resolved after completion of the more detailed definitive
documentation to be negotiated between the Corporation and CSX.
Also pending STB approval, each of the Corporation and CSX will have and may
exercise a 50% voting interest in the joint subsidiary formed to effect the
acquisition of the Conrail Shares ("Acquisition Sub"). Each of the parties will
have the right to appoint 50% of Acquisition Sub's directors and each will be
entitled to appoint a full time co-chief executive officer. All Acquisition Sub
executive appointments will be subject to approval by its board of directors. In
addition, the parties are in the process of establishing a protocol for the
management of Acquisition Sub as well as a list of those items that will require
board approval. These provisions will continue to apply following STB approval
in order to effectuate the transactions contemplated by the Agreement and other
documents.
In the Agreement, the parties agreed that following the merger of Conrail
and Acquisition Sub or a subsidiary thereof, (i) the surviving corporation of
such merger will be preserved, (ii) the division of
4
<PAGE>
assets and assumption of liabilities of Conrail will be specified in more detail
in definitive documentation and (iii) the allocation of assets and liabilities,
pursuant to long-term operating agreements, leases, one or more partnerships
and/or limited liability companies and indemnity arrangements, will be set forth
in the definitive documentation.
The parties further agreed that, prior to STB approval, neither company at
any time will operate or exercise operational control over any of the routes or
assets related thereto or facilities of Conrail. Allocations of rolling stock,
locomotives and work equipment are to be made generally in proportion to the
respective percentages of each of the companies and are to be set forth in a
further agreement of the parties. Reference is made to the Agreement for a
further description of the allocations of various assets and the assumption of
liabilities, the terms of which are subject to further agreements.
The Corporation has identified a number of synergies related to the
Transaction which its management believes can be achieved and that are estimated
to yield operating income in nominal dollars of approximately $71 million in
1998, $236 million in 1999 and $399 million by the year 2000 For 1996, the
Corporation's and Conrail's most recent full fiscal year, combined operating
income, reflecting 58% of Conrail's operating income, adjusted for non-recurring
charges, was $1.6 billion. These synergy estimates reflect anticipated operating
expense savings and revenue enhancements. Expense savings are expected to result
from, among other things, reduced general and administrative expenses, improved
equipment utilization and maintenance, improved use of rail yards and routes,
more efficient purchasing of material and equipment, coupled with
maintenance-of-way efficiencies, and more efficient transportation operations.
Revenue enhancements are expected to result from net new business (single-line
service, new coal traffic and the diversion of truck traffic to rail). The
Corporation anticipates the synergies from the Transaction will result in
accretion in the Corporation's earnings per share of about 6% in 1999, 15% in
2000 and more than 17% per year thereafter. The Corporation expects the
acquisition to be dilutive to earnings per share by approximately 2% in 1997 and
3% in 1998. The Corporation currently expects to book approximately $200 million
of goodwill in accounting for the Transaction. This estimate will vary as
additional information in the form of appraisals, actuarial reports and other
valuations are made. However, whether the excess of purchase price over the book
value of Conrail's net assets is assigned to physical assets or goodwill is not
expected to have a significant effect on net income since railroad assets are
typically long-lived and goodwill is amortized over periods of up to 40 years.
The foregoing is more completely described in the Corporation's Current Report
on Form 8-K, dated April 23, 1997, which is incorporated herein by reference and
by which all related statements herein are qualified.
The foregoing estimates of cost savings, synergies, projected earnings per
share and pro forma financial information are "forward-looking" and inherently
subject to significant uncertainties and contingencies, many of which are beyond
the control of the Corporation, including: (a) future economic conditions in the
markets in which the Corporation and Conrail operate; (b) financial market
conditions; (c) inflation rates; (d) changing competition and the effects of new
and increased competition in the areas served by the Corporation and Conrail;
(e) changes in the economic regulatory climate in the United States railroad
industry; (f) the Corporation's ability to eliminate or reduce duplicative
administrative and other functions and facilities following the Transaction; (g)
labor uncertainties and the Corporation's ability to implement anticipated labor
savings; (h) unanticipated environmental and other situations relating to
Conrail assets; (i) the Corporation's ability to integrate certain Conrail
assets, including its information technology systems, within the Corporation's
systems; and (j) adverse changes in applicable laws, regulations or rules
governing environmental, tax or accounting matters. There can be no assurance
that the estimated savings, revenue increases, synergies, projected earnings per
share and pro forma financial information will be achieved; actual savings,
revenues increases, synergies, projected earnings per share and pro forma
financial information may vary materially from those estimated. The inclusion of
such estimates herein should not be regarded as in indication or affirmation
that the Corporation or any other party considers such estimates an accurate
prediction of future events.
5
<PAGE>
In addition, certain of management's estimates of future costs, expenses and
liabilities, such as environmental matters discussed in the Corporation's Annual
Report on Form 10K for the fiscal year ended December 31, 1996, are based on
facts and circumstances known to management after consultation with those who
have access to such information including, in the case of such environmental
matters, numerous engineers and counsel, both in-house and outside the
Corporation.
The Corporation's executive offices are located at Three Commercial Place,
Norfolk, Virginia 23510-2191 (telephone number: (757) 629-2600). Unless the
context indicates otherwise, references herein to the Corporation are to Norfolk
Southern Corporation and its consolidated subsidiaries.
6
<PAGE>
USE OF PROCEEDS
Except as may be otherwise set forth in an accompanying Prospectus
Supplement, the Corporation intends to use the net proceeds from the sale of the
Securities primarily to fund the purchase of its portion of the purchase price
for the Conrail Shares pursuant to the Joint Offer. The Corporation intends to
use the balance, if any, of the net proceeds (i) to purchase shares of its
Common Stock from time to time in open market transactions pursuant to an
ongoing share purchase program commenced by the Corporation in 1987 but which is
currently suspended, (ii) to retire all or a portion of the Corporation's
short-term indebtedness, (iii) to acquire new or used property, including
without limitation locomotives and rolling stock, (iv) to meet general corporate
purposes and (v) to accomplish any other purpose approved by a duly authorized
officer of the Corporation.
RATIOS OF EARNINGS TO FIXED CHARGES
For purposes of computing the ratios of earnings to fixed charges, earnings
represent income before income taxes, plus interest expenses (including a
portion of rental expenses representing an interest factor) and subsidiaries'
preferred dividend requirements, less the equity in undistributed earnings of
20%-49% owned companies. Fixed charges represent interest expenses (including a
portion of rental expense representing an interest factor) plus capitalized
interest and subsidiaries' preferred dividend requirements on a pre-tax basis.
The following table sets forth the ratio of earnings to fixed charges of the
Corporation for each period indicated:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
- -------------------------------------------------------------
<S> <C> <C> <C> <C>
1996 1995 1994 1993(1,2) 1992
- ------------- --------- --------- ------------- ---------
6.85 6.70 6.66 5.67 5.67
</TABLE>
- ------------------------------
(1) 1993 results include a $54 million increase in the provision for income
taxes reflecting a 1% increase in the federal income tax rate, which reduced
net income by $54 million, or $0.39 per share. 1993 transportation operating
expenses include a $50 million restructuring charge for the disposition of
two NAVL trucking businesses. 1993 also includes the cumulative effect of
certain required accounting changes (see Note 2 below), which increased 1993
earnings by $223 million, or $1.60 per share.
(2) Effective January 1, 1993, the Corporation adopted SFAS 106 "Employers'
Accounting for Postretirement Benefits Other Than Pensions," SFAS 109
"Accounting for Income Taxes," and SFAS 112 "Employers' Accounting for
Postemployment Benefits." The Corporation recognized these accounting
changes on the immediate recognition basis. Therefore, the cumulative effect
on years prior to 1993 of adopting these new accounting standards was as
follows: SFAS 106 and 112 increased pretax expenses by $392 million ($243.5
million after-tax) and reduced earnings per share by $1.74; and SFAS 109
increased net income by $466.8 million and increased earnings per share by
$3.34.
Because the Corporation has no outstanding Preferred Stock, the ratio of
earnings to the sum of fixed charges and preferred stock dividends is the same
as the ratio of earnings to fixed charges.
7
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The Debt Securities may be issued from time to time in one or more series.
The particular terms of each series of Debt Securities offered (the "Offered
Debt Securities") by any Prospectus Supplement or Prospectus Supplements will be
described therein. The Senior Debt Securities will be issued under an indenture,
dated as of January 15, 1991 (the "Senior Indenture"), between the Corporation
and First Trust of New York, National Association, as successor trustee (the
"Senior Trustee"), a copy of the form of which Senior Indenture is filed as an
exhibit to the Registration Statement. The Subordinated Debt Securities are to
be issued under a separate Indenture (the "Subordinated Indenture") between the
Company and First Trust of New York, National Association, as Trustee (the
"Subordinated Trustee"), a copy of the form of which Subordinated Indenture is
filed as an exhibit to the Registration Statement. The Senior Indenture and the
Subordinated Indenture are sometimes referred to collectively as the
"Indentures" and the Senior Trustee and the Subordinated Trustee are sometimes
referred to collectively as the "Trustees."
The following summaries of certain provisions of the Indentures do not
purport to be complete and are subject to, and are qualified in their entirety
by reference to, all the provisions of the Indentures, including the definitions
therein of certain terms. Wherever particular sections or defined terms of the
Indentures are referred to, it is intended that such sections or defined terms
shall be incorporated herein by reference. Capitalized terms not otherwise
defined herein shall have the meanings given to them in the Indentures. The
following sets forth certain general terms and provisions of the Senior Debt
Securities and the Subordinated Debt Securities. Further terms of any Offered
Debt Securities will be set forth in the applicable Prospectus Supplement.
Because the Corporation is a holding company, its rights and the rights of
its creditors, including the Holders of the Debt Securities offered hereby, to
participate in any distribution of the assets of any subsidiary upon the
liquidation or recapitalization of such subsidiary will be subject to the prior
claims of that subsidiary's creditors except to the extent that the Corporation
itself may be a creditor with recognized prior claims against that subsidiary.
GENERAL
The Indentures do not limit the aggregate principal amount of Debt
Securities that may be issued thereunder and provide that Debt Securities may be
issued from time to time in series. Unless otherwise specified in the applicable
Prospectus Supplement, the Debt Securities will be unsecured obligations of the
Corporation. Unless otherwise specified in the Prospectus Supplement, the Senior
Debt Securities when issued will rank on a parity with all other unsecured and
unsubordinated indebtedness of the Corporation. The Subordinated Debt Securities
when issued will be subordinated in right of payment to the prior payment in
full of all Senior Indebtedness (as defined in the applicable supplemental
Subordinated Indenture) of the Corporation as described below under
"--Subordination of Subordinated Debt Securities" and in the applicable
Prospectus Supplement.
The applicable Prospectus Supplement will also describe the following terms
of any Offered Debt Securities: (1) the title of Offered Debt Securities; (2)
any limit on the aggregate principal amount of Offered Debt Securities; (3) the
date or dates on which Offered Debt Securities will mature; (4) the rate or
rates per annum at which Offered Debt Securities will bear interest, if any, or
the formula or provision pursuant to which such rate or rates are determined and
the date from which such interest, if any, will accrue; (5) the dates on which
such interest, if any, on Offered Debt Securities will be payable and the
Regular Record Dates for such Interest Payment Dates; (6) any mandatory or
optional sinking fund or analogous provisions; (7) the date, if any, after
which, and the price or prices at which, Offered Debt Securities may, pursuant
to any optional or mandatory redemption provisions, be redeemed and the other
detailed terms and provisions of any such optional or mandatory redemption
provisions; (8) the currency or currencies of payment of principal, premium, if
any, and/or interest, if any, on Offered Debt Securities; (9) whether Offered
Debt Securities are to be issued in whole or part in the form of a Global
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Note or Notes and, if so, the identity of the Depositary for such Global Note or
Notes; (10) the terms and conditions, if any, upon which a Global Note or Notes
may be exchanged in whole or in part for other definitive Offered Debt
Securities; (11) any index used to determine the amount of payments of
principal, premium, if any, and/or interest, if any, on Offered Debt Securities;
(12) the applicability of any provisions described under "Satisfaction and
Discharge of Indenture"; (13) any covenants applicable to such Debt Securities;
(14) the terms and conditions, if any, pursuant to which Offered Debt Securities
are or may be convertible or exchangeable into Preferred Stock, Depositary
Shares, Common Stock or other securities of the Corporation; and (15) any other
terms of the series of Offered Debt Securities.
Unless otherwise provided in the applicable Prospectus Supplement,
principal, premium, if any, and/or interest, if any, on Offered Debt Securities
will be payable, and the transfer of Offered Debt Securities will be
registrable, at the office of the applicable Trustee, except that, at the option
of the Corporation, interest may be paid by mailing a check to the address of
the person entitled thereto as such address appears on the Security Register.
Offered Debt Securities may be issuable in whole or in part in the form of
one or more Global Notes, as described below under "Global Notes." Unless
otherwise indicated in the Prospectus Supplement, Debt Securities will be issued
only in fully registered form without coupons and in minimum denominations of
$100,000 or any integral multiples of $1,000 in excess thereof. One or more
Global Notes will be issued in a denomination or aggregate denominations equal
to the aggregate principal amount of Outstanding Debt Securities of the series
to be represented by such Global Note or Notes. The Prospectus Supplement
relating to a series of Offered Debt Securities denominated in a foreign or
composite currency will specify the denomination thereof. No service charge will
be made for any transfer or exchange of Debt Securities, but the Corporation may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith.
Debt Securities may be issued as Original Issue Discount Securities to be
sold at a substantial discount below their principal amount. Special federal
income tax and other considerations applicable thereto will be described in the
applicable Prospectus Supplement.
GLOBAL NOTES
Debt Securities of a series may be issued in whole or in part in the form of
one or more Global Notes that will be deposited with, or on behalf of, a
depositary (the "Depositary") identified in the applicable Prospectus
Supplement, which also shall describe the specific terms of the depositary
arrangement. The Corporation anticipates that the following provisions will
apply to all depositary arrangements.
Upon the issuance of a Global Note, the Depositary for such Global Note will
credit, on its book-entry registration and transfer system, the respective
principal amounts of Debt Securities represented by such Global Note to the
accounts of institutions that have accounts with such Depositary
("Participants"). The accounts to be credited shall be designated by the
underwriters or agents of such Debt Securities or, if such Debt Securities are
offered and sold directly by the Corporation, by the Corporation. Ownership of
beneficial interests in a Global Note will be limited to Participants or persons
that may hold interests through Participants. Ownership of beneficial interests
in such Global Note will be shown on, and the transfer of that ownership will be
effected only through, records maintained by the Depositary for such Global Note
(with respect to interests of Participants) or by Participants or persons that
hold through Participants (with respect to interests of persons other than
Participants). For such purposes, the laws of some states may require that
certain purchasers of securities take physical delivery of such securities in
definitive form. Such limits and such laws may impair the ability to own,
transfer or pledge beneficial interests in a Global Note.
So long as the Depositary for a Global Note, or its nominee, is the
registered owner of such Global Note, such Depositary or such nominee, as the
case may be, will be considered the sole owner or Holder of Debt Securities
represented by such Global Note for all purposes under the Indenture. Except as
set
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forth below, owners of beneficial interests in a Global Note will not be
entitled to have Debt Securities of the series represented by such Global Note
registered in their names, will not receive or be entitled to receive physical
delivery of Debt Securities of such series in definitive form and will not be
considered the owners or holders thereof under the Indenture. Accordingly, each
person owning a beneficial interest in the Global Note must rely on the
procedures of the Depositary and, if such person is not a Participant, on the
procedures of the Participant through which such person owns its interest, to
exercise any rights of a Holder under the applicable Indenture. The Indentures
provide that the Depositary may grant proxies and otherwise authorize
Participants to take any action a Holder is entitled to take under the
applicable Indenture. The Corporation understands that under existing industry
practice, in the event that the Corporation requests any action of Holders or a
beneficial owner desires to take any action a Holder is entitled to take, the
Depositary would authorize the Participants to take such action and that the
Participants would authorize beneficial owners owning through such Participants
to take such action or would otherwise act upon the instructions of beneficial
owners owning through such Participants.
Payment of principal, premium, if any, and/or interest, if any, on Debt
Securities registered in the name of or held by a Depositary or its nominee will
be made to the Depositary or its nominee, as the case may be, as the registered
owner or the Holder of the Global Note representing such Debt Securities. None
of the Corporation, the Trustees, any Paying Agent or the Registrar for such
Debt Securities will have any responsibility or liability with respect to the
records relating to or payments made on account of beneficial ownership
interests in a Global Note for such Debt Securities or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
The Corporation expects that the Depositary for Debt Securities of a series,
upon receipt of any payment of principal, premium, if any, and/or interest, if
any, in respect of a Global Note, will immediately credit Participants' accounts
with payments in amounts proportionate to their respective beneficial interests
in the principal amount of such Global Note as shown on the records of such
Depositary. The Corporation also expects that payments by Participants to owners
of beneficial interests in such Global Note held through such Participants will
be governed by standing instructions and customary practices, as is now the case
with securities held for the accounts of customers in bearer form or registered
in "street name," and will be the responsibility of such Participants.
A Global Note may not be transferred except as a whole by the Depositary for
such Global Note to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary. A Global
Note is exchangeable for Debt Securities registered in the names of persons
other than the Depositary with respect to such Global Note or its nominee only
if (1) such Depositary notifies the Corporation that it is unwilling or unable
to continue as Depositary for such Global Note or if at any time such Depositary
ceases to be a clearing agency registered under the Exchange Act and, in either
case, a successor Depositary is not appointed by the Corporation within 90 days,
(2) the Corporation executes and delivers to the applicable Trustee a Company
Order that all such Global Notes shall be exchangeable or (3) there shall have
occurred and be continuing an Event of Default or an event which, with the
giving of notice or lapse of time, or both, would constitute an Event of Default
with respect to those Debt Securities. Any Global Note that is exchangeable
pursuant to the preceding sentence shall be exchangeable for Debt Securities
registered in such names as the Depositary with respect to such Global Note
shall direct.
If a Depositary for Notes of a series is at any time unwilling or unable to
continue as depositary, or if at any time such Depositary ceases to be a
clearing agency registered under the Exchange Act, and, in either case, a
successor Depositary is not appointed by the Corporation within 90 days or if
there shall have occurred and be continuing an Event of Default or an event
which, with the giving of notice or lapse of time, or both, would constitute an
Event of Default with respect to such Notes, then the Corporation will issue
Notes of such series in definitive form in exchange for all Global Notes
representing the Notes of such series. In addition, the Corporation may at any
time and in its sole discretion determine not to have the Notes of a series
represented by Global Notes and in such event, will issue Notes of such series
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in definitive form in exchange for all Global Notes representing such Notes. In
any such instance, an owner of a beneficial interest in a Global Note will be
entitled to physical delivery in definitive form of Notes of the series
represented by such Global Note equal in principal amount to such beneficial
interest and to have such Notes registered in its name.
EVENTS OF DEFAULT
The Indentures define an Event of Default with respect to Debt Securities of
any series as any of the following events: (1) failure to pay principal of or
any premium on any Debt Security of that series when due; (2) failure to pay any
interest on any Debt Security of that series when due, continued for 30 days;
(3) failure to pay any sinking fund installment with respect to any Debt
Security of that series when due; (4) failure to perform any other covenant of
the Corporation in the applicable Indenture (other than a covenant included in
the applicable Indenture solely for the benefit of a series of Debt Securities
other than that series), continued for 90 days after written notice as provided
in the Indenture; (5) acceleration of Debt Securities or any other indebtedness
for borrowed money, in an aggregate principal amount exceeding $50,000,000, of
the Corporation or any Significant Subsidiary (within the meaning of the federal
securities laws) under the terms of the instrument or instruments under which
such indebtedness is issued or secured, if such acceleration is not annulled, or
such indebtedness is not discharged, or a sum of money sufficient to discharge
in full such indebtedness is not deposited in trust, within 10 days after
written notice as provided in the Indenture; (6) certain events of bankruptcy,
insolvency or reorganization; and (7) any other Event of Default provided with
respect to Debt Securities of that series.
If an Event of Default with respect to Debt Securities of any series at the
time Outstanding occurs and is continuing, either the applicable Trustee or the
Holders of at least 25% in aggregate principal amount of the Outstanding
Securities of that series by notice as provided in the applicable Indenture may
declare the principal amount (or, if the Debt Securities of that series are
Original Issue Discount Notes, such portion of the principal amount as may be
specified in the terms of that series) of all Debt Securities of that series to
be due and payable immediately. At any time after a declaration of acceleration
with respect to Debt Securities of any series has been made, but before a
judgment or decree for payment of money has been obtained by the Trustee with
respect to that series, the Holders of a majority in aggregate principal amount
of Outstanding Securities of that series may, under certain circumstances,
rescind and annul such acceleration.
The Indentures provide that the applicable Trustee will not be under any
obligation to exercise any of its rights or powers under the Indenture at the
request or direction of any of the Holders, unless such Holders shall have
offered to such Trustee reasonable indemnity. Subject to such provisions for the
indemnification of the Trustees, the Holders of a majority in aggregate
principal amount of the Outstanding Securities of any series will have the right
to direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee, or of exercising any trust or power conferred on the
Trustee, with respect to the Debt Securities of that series.
The Corporation is required to furnish to the applicable Trustee annually a
statement as to the performance by the Corporation of certain of its obligations
under the appropriate Indenture and as to any default in such performance.
CONVERSION OR EXCHANGE OF DEBT SECURITIES
If so indicated in the applicable Prospectus Supplement with respect to a
particular series of Offered Debt Securities, such series will be convertible or
exchangeable into Preferred Stock, Depositary Shares or Common Stock or other
securities of the Corporation registered hereby on the terms and conditions set
forth therein. Such terms will include provisions as to whether conversion is
mandatory, at the option of the Holder or at the option of the Corporation, and
may include provisions pursuant to which the number of shares of Preferred Stock
or Common Stock or other securities of the Corporation to be received by the
holders of such Debt Securities will be calculated according to the market price
of the
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Preferred Stock, Depositary Shares, Common Stock or other securities of the
Corporation as of the time stated in the applicable Prospectus Supplement. See
"Description of Capital Stock."
SUBORDINATION OF SUBORDINATED DEBT SECURITIES
The Subordinated Debt Securities will be direct, unsecured obligations of
the Corporation, subordinate in right of payment to the extent set forth in the
Subordinated Indenture and the applicable supplemental Subordinated Indenture to
all Senior Indebtedness including all Senior Debt Securities (in each case as
defined in the applicable supplemental Subordinated Indenture). Except to the
extent otherwise set forth in the applicable Prospectus Supplement and
supplemental Subordinated Indenture, the Subordinated Indenture does not contain
any restriction on the amount of Senior Indebtedness that the Corporation may
incur.
The terms of the subordination of a series of Subordinated Debt Securities,
together with the definition of Senior Indebtedness related thereto, will be as
set forth in the applicable supplemental Subordinated Indenture and Prospectus
Supplement.
The Subordinated Debt Securities will not be subordinated to indebtedness of
the Corporation that is not Senior Indebtedness, and the creditors of the
Corporation who do not hold Senior Indebtedness will not benefit from the
subordination provisions described herein. In the event of the bankruptcy or
insolvency of the Corporation before or after maturity of the Subordinated Debt
Securities, such other creditors would rank PARI PASSU with holders of the
Subordinated Debt Securities, subject, however, to the broad equity powers of
the federal bankruptcy court pursuant to which such court may, among other
things, reclassify the claims of any series of Subordinated Debt Securities into
a class of claims having a different relative priority with respect to the
claims of such other creditors or any other claims against the Corporation.
SATISFACTION AND DISCHARGE OF INDENTURE
The Indentures provide generally that the Corporation may terminate its
obligations under the applicable Indenture with respect to Debt Securities of
any series if all the Debt Securities of such series previously authenticated
and delivered (other than lost, destroyed or stolen Debt Securities of such
series that have been replaced or paid) have been delivered to the Trustee for
cancellation and the Corporation has paid all sums payable by it thereunder, or
if the Corporation irrevocably deposits with the applicable Trustee (1)
sufficient funds in the currency in which Debt Securities of such series are
denominated to pay the principal, premium, if any, and/or interest, if any, to
Stated Maturity (or redemption) on Debt Securities of such series and/or (2)
such amount of direct obligations of, or obligations the principal of and
interest, if any, on which are fully guaranteed by, the government which issued
the currency in which the Debt Securities are denominated, and which are not
subject to prepayment, redemption or call, as will, through the payment of
principal and interest, if any, thereon in accordance with their terms, be
sufficient to pay when due, the principal, premium, if any, and/or interest, if
any, to Stated Maturity (or redemption) on, Debt Securities of such series. As a
condition to defeasance, the Corporation must deliver to the applicable Trustee
an Opinion of Counsel to the effect that the Holders of such Debt Securities
will not recognize gain or loss on such Debt Securities for federal income tax
purposes solely as a result of such defeasance and will be subject to federal
income tax in the same amounts and at the same times as would have been the case
if such defeasance had not occurred. In the event of any such defeasance,
Holders of Debt Securities must look to the deposited money for payment.
MODIFICATION AND WAIVER
Modifications and amendments of the applicable Indenture may be made by the
Corporation and the applicable Trustee with the consent of the Holders of a
majority in aggregate principal amount of the Outstanding Securities of each
series affected by such modification or amendment; PROVIDED, HOWEVER,
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that no such modification or amendment may, without the consent of the Holder of
each Outstanding Security affected thereby, (1) change the stated maturity date
of the principal of, or any installment of principal of, premium, if any, or
interest, if any, on, any Debt Security, (2) reduce the principal, premium, if
any, and/or interest, if any, on any Debt Security, (3) reduce the amount of
principal of an Original Issue Discount Debt Security payable upon acceleration
of the maturity thereof, (4) change the place or currency of payment of
principal, premium, if any, and/or interest, if any, on any Debt Security, (5)
impair the right to institute suit for the enforcement of any payment on or with
respect to any Debt Security, (6) reduce the percentage in principal amount of
Outstanding Securities of any series, the consent of the Holders of which is
required for modification or amendment of the Indenture or for waiver of
compliance with certain provisions of the applicable Indenture or for waiver of
certain defaults, (7) modify the conversion provisions applicable to convertible
Debt Securities in a manner adverse to the Holders thereof or (8) modify the
subordination provisions applicable to any series of Debt Securities in a manner
adverse to the Holders thereof.
The Holders of a majority in aggregate principal amount of the Outstanding
Securities of each series may, on behalf of all Holders of Debt Securities of
that series, waive, insofar as that series is concerned, compliance by the
Corporation with certain restrictive provisions of the Indenture. The Holders of
a majority in aggregate principal amount of the Outstanding Securities of each
series may, on behalf of all Holders of Debt Securities of that series, waive
any past default under the applicable Indenture with respect to Debt Securities
of that series, except (1) a default in the payment of principal, premium, if
any, and/or interest, if any, on any Debt Security of such series and (2) in
respect of a covenant or provision of the Indenture which cannot be modified or
amended without the consent of the Holder of each Outstanding Security of such
series affected.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Corporation, without the consent of the Holders of a majority in
aggregate principal amount of the Outstanding Securities under the Indentures,
may not consolidate with or merge into, or transfer or lease its assets
substantially as an entirety to, any corporation (which, as defined in the
applicable Indenture, includes corporations, associations, companies and
business trusts), unless (1) the successor corporation is a corporation
organized and existing under the laws of the United States of America or a state
thereof or the District of Columbia and assumes the Corporation's obligations on
the Debt Securities and under the Indentures, (2) after giving effect to the
transaction no Event of Default, and no event which, after notice or lapse of
time, would become an Event of Default, shall have occurred and be continuing
and (3) the successor corporation executes supplemental indentures satisfactory
to the Trustees evidencing its assumption of the Indentures and delivers
opinions and certificates as to compliance with such requirements. The
Indentures do not contain any provisions that limit the Corporation's ability to
incur indebtedness. Holders of Debt Securities will not have the benefit of any
specific covenants or provisions in the applicable Indenture or Debt Securities
that would protect them in the event the Corporation engages in or becomes the
subject of a merger, takeover, other highly leveraged transaction or a change in
control, other than any covenants described in any applicable Prospectus
Supplement, and the limitations on consolidation, merger and sale of assets
substantially as an entirety to any person as described above. Any such
covenants could not be waived or modified by the Corporation or its Board of
Directors, although holders of Debt Securities could waive or modify such
covenants as more fully described above under "--Modification and Waiver."
CONCERNING THE TRUSTEE
First Trust of New York, National Association, is the Trustee under each of
the Indentures and has been appointed by the Corporation as Security Registrar
and Paying Agent with regard to the Debt Securities.
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The holders of a majority in principal amount of the Outstanding Debt
Securities of any series will have the right to direct the time, method and
place of conducting any proceeding for exercising any remedy available to the
applicable Trustee, subject to certain exceptions. Each Indenture provides that
if an Event of Default occurs (and is not cured) with respect to a series of
Debt Securities, the applicable Trustee will be required, in the exercise of its
power, to use the degree of care of a prudent man in the conduct of his own
affairs. Subject to such provisions, no Trustee will be under any obligation to
exercise any of its rights or powers under the Indentures at the request of any
Holder of Debt Securities of such series, unless such Holder first shall have
offered to such Trustee security and indemnity satisfactory to such Trustee
against any loss, liability or expense and then only to the extent required by
the terms of the applicable Indenture.
GOVERNING LAW
Each Indenture provides that it and the Debt Securities will be governed by,
and construed in accordance with, the laws of the State of New York.
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DESCRIPTION OF CAPITAL STOCK
The Corporation's Restated Articles of Incorporation (the "Articles of
Incorporation") authorize issuance of up to 450,000,000 shares of Common Stock,
par value $1.00 per share, and up to 25,000,000 shares of Preferred Stock,
without par value. As of December 31, 1996, 125,097,374 shares of Common Stock
were outstanding and no shares of Preferred Stock had been issued.
The Board of Directors of the Corporation has the power, without further
action by the stockholders unless action is required at the time by applicable
laws or regulations or by the terms of any outstanding Preferred Stock, to issue
Preferred Stock in one or more series and to fix the designations, preferences
and voting rights, and relative, participating, optional and other special
rights, and the qualifications, limitations and restrictions applicable thereto.
The rights of Holders of any Preferred Stock offered hereby (the "Offered
Preferred Stock") will be subject to, and may be affected adversely by, the
rights of Holders of any Preferred Stock that may be issued in the future.
Issuance of shares of Preferred Stock by the Corporation may have the effect,
under certain circumstances, alone or in combination with certain of the
provisions (described below) of the Articles of Incorporation, of rendering more
difficult or discouraging an acquisition of the Corporation deemed undesirable
or not in the best interests of the Corporation by the Board of Directors even
when such transaction is favored by a majority of the Corporation's
shareholders.
OFFERED PREFERRED STOCK
The following is a description of certain general terms and provisions of
Offered Preferred Stock. The particular terms and provisions of any series of
Offered Preferred Stock will be described in the applicable Prospectus
Supplement. If so indicated in a Prospectus Supplement, the terms and provisions
of any such series may differ from the terms set forth below. The summary of
terms and provisions of Offered Preferred Stock contained in this Prospectus and
any applicable Prospectus Supplement will describe all the material provisions
thereof but does not purport to be complete and is subject to, and qualified in
its entirety by, the provisions of the Articles of Incorporation and the
Certificate of Amendment relating to a specific series of the Offered Preferred
Stock (the "Certificate of Amendment"), which will be in the form filed as an
exhibit to or incorporated by reference into the Registration Statement of which
this Prospectus is a part at or prior to the time of issuance of such series of
Offered Preferred Stock.
The Board of Directors is authorized to determine for each series of Offered
Preferred Stock, and the Prospectus Supplement shall set forth with respect to
such series: (1) the number of shares that constitute such series, (2) the
dividend rate (or the method of calculation thereof) on the shares of such
series, (3) the dividend periods (or the method of calculation thereof), (4) the
voting rights of the shares, (5) the liquidation preference and any other rights
of the shares of such series upon any liquidation or winding-up of the
Corporation, (6) whether or not and on what terms the shares of such series will
be subject to redemption at the option of the Corporation, (7) whether and on
what terms the shares of such series will be convertible into shares of Common
Stock of the Corporation, (8) whether Depositary Shares representing shares of
such series of Preferred Stock will be offered and, if so, the fraction of a
share of such series of Offered Preferred Stock represented by each Depositary
Share (see "Depositary Shares" below), (9) whether the shares of such series of
Offered Preferred Stock will be listed on a securities exchange and (10) any
other rights and privileges and any qualifications, limitations or restrictions
of such rights or privileges of such series.
DIVIDENDS
Except as otherwise set forth in the applicable Certificate of Amendment and
Prospectus Supplement, Holders of shares of Offered Preferred Stock shall be
entitled to receive, when, as and if declared by the Board of Directors out of
funds of the Corporation legally available therefor, a cash dividend
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payable at such dates and at such rates per share per annum as are set forth in
the applicable Prospectus Supplement.
Unless otherwise set forth in the applicable Prospectus Supplement, each
series of Offered Preferred Stock will be junior as to dividends to any
Preferred Stock that may be issued in the future that is expressly senior as to
dividends to such Offered Preferred Stock. If at any time the Corporation has
failed to pay accrued dividends upon any such outstanding senior Preferred Stock
at the time such dividends are payable, the Corporation may not pay any dividend
on the Offered Preferred Stock or redeem or otherwise repurchase shares of such
Offered Preferred Stock until such accumulated but unpaid dividends on such
senior Preferred Stock have been paid or set aside for payment in full by the
Corporation.
No dividends may be declared or paid or set apart for payment on any
Preferred Stock ranking on parity as to dividends with outstanding Offered
Preferred Stock unless there shall also be or have been declared and paid or set
apart for payment on the outstanding shares of Offered Preferred Stock dividends
for all dividend payment periods of the Offered Preferred Stock ending on or
before the dividend payment date of such parity Preferred Stock, ratably in
proportion to the respective amounts of dividends, (i) accumulated and unpaid or
payable on such parity Preferred Stock, on the one hand, and (ii) accumulated
and unpaid or payable through the dividend payment period of the Offered
Preferred Stock next preceding such dividend payment date, on the other hand.
Except as set forth above, dividends (other than in Common Stock) may not be
paid or declared and set aside for payment and no other distributions may be
made upon the Common Stock or on any other Preferred Stock of the Corporation
ranking junior to or on parity as to dividends with outstanding Offered
Preferred Stock, nor may any Common Stock or such other Preferred Stock of the
Corporation be redeemed, purchased or otherwise acquired by the Corporation for
any consideration, or any payment be made to or available for a sinking fund for
the redemption of any shares of such stock; PROVIDED, HOWEVER, that any monies
theretofore deposited in any sinking fund with respect to any Preferred Stock in
compliance with the provisions of such sinking fund may thereafter be applied to
the purchase or redemption of such Preferred Stock in accordance with the terms
of such sinking fund, regardless of whether at the time of such applications
full cumulative dividends upon shares of the Offered Preferred Stock outstanding
on the last dividend payment date shall have been paid or declared and set apart
for payment; and PROVIDED, FURTHER,that any such junior or parity Preferred
Stock or Common Stock may be converted into or exchanged for stock of the
Corporation ranking junior to the Offered Preferred Stock as to dividends.
The amount of dividends payable for the initial dividend period or any
period shorter than a full dividend period shall be computed on the basis of a
360-day year of twelve 30-day months. Accrued but unpaid dividends will not bear
interest.
CONVERTIBILITY
No series of Offered Preferred Stock will be convertible into, or
exchangeable for, other securities or property except such securities registered
hereby as may be set forth in the applicable Certificate of Amendment and
Prospectus Supplement.
REDEMPTION AND SINKING FUND
No series of Offered Preferred Stock will be redeemable or receive the
benefit of a sinking fund except as set forth in the applicable Certificate of
Amendment and Prospectus Supplement.
LIQUIDATION RIGHTS
In the event of any liquidation, dissolution or winding-up of the
Corporation, the holders of shares of each series of Offered Preferred Stock are
entitled to receive out of assets of the Corporation available for distribution
to stockholders, before any distribution of assets is made to Holders of (1) any
other
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shares of Preferred Stock ranking junior to such series of Offered Preferred
Stock as to rights upon liquidation, dissolution or winding-up and (2) Common
Stock, liquidating distributions per share in the amount of the liquidation
preference specified in the applicable Certificate of Amendment and Prospectus
Supplement for such series of Offered Preferred Stock, plus dividends accrued
and accumulated but unpaid to the date of final distribution; but the Holders of
each series of Offered Preferred Stock will not be entitled to receive the
liquidating distribution of, plus such dividends on, such shares until the
liquidation preference of any shares of the Corporation's capital stock ranking
senior to such series of Offered Preferred Stock as to the rights upon
liquidation, dissolution or winding-up shall have been paid (or a sum set aside
therefor sufficient to provide for payment) in full. If upon any liquidation,
dissolution or winding-up of the Corporation, the amounts payable in respect of
Offered Preferred Stock and any other Preferred Stock ranking as to any such
distribution on a parity with Offered Preferred Stock are not paid in full, the
Holders of Offered Preferred Stock and such other parity Preferred Stock will
share ratably in any such distribution of assets in proportion to the full
respective preferential amount to which they are entitled. Unless otherwise
specified in the applicable Certificate of Amendment and Prospectus Supplement
for a series of Offered Preferred Stock, after payment of the full amount of the
liquidating distribution to which they are entitled, the Holders of shares of
Offered Preferred Stock will not be entitled to any further participation in any
distribution of assets by the Corporation. Neither a consolidation or merger of
the Corporation with another corporation or other entity nor a sale of
securities shall be considered a liquidation, dissolution or winding-up of the
Corporation.
VOTING RIGHTS
Holders of Offered Preferred Stock will not have any voting rights except as
set forth below or in the applicable Certificate of Amendment and Prospectus
Supplement or as otherwise from time to time required by law. Whenever dividends
on a series of Offered Preferred Stock or any other class or series of stock
ranking on a parity with such series of Offered Preferred Stock with respect to
the payment of dividends shall be in arrears for dividend periods, whether or
not consecutive, containing in the aggregate a number of days equivalent to six
calendar quarters, the Holders of shares of such series of Offered Preferred
Stock (voting separately as a class with all other series of Preferred Stock
upon which like voting rights have been conferred and are exercisable) will be
entitled to vote for the election of two of the authorized number of directors
of the Corporation at the next annual meeting of stockholders and at each
subsequent meeting until all dividends accumulated on such series of Offered
Preferred Stock shall have been fully paid or set apart for payment. The term of
office of all directors elected by the holders of such Offered Preferred Stock
shall terminate immediately upon the termination of the rights of the Holders of
such Offered Preferred Stock to vote for directors. Unless otherwise set forth
in the applicable Certificate of Amendment and Prospectus Supplement, Holders of
shares of Offered Preferred Stock will have one vote for each share held.
So long as any shares of any series of Offered Preferred Stock remain
outstanding, the Corporation shall not, without the consent of Holders of at
least two thirds of the shares of such series of Offered Preferred Stock
outstanding at the time (voting separately as a class with all other series of
Preferred Stock upon which like voting rights have been conferred and are
exercisable) amend, alter or repeal the provisions of the Articles of
Incorporation or of the resolutions contained in the Certificate of Amendment
relating to such series of Offered Preferred Stock, whether by merger,
consolidation or otherwise, so as materially adversely to affect any power,
preference or special right of such series of Offered Preferred Stock or the
Holders thereof; PROVIDED, HOWEVER, that any increase in the amount of the
authorized Common Stock or authorized Preferred Stock or any increase or
decrease in the number of shares of any series of Preferred Stock or the
creation and issuance of other series of Common Stock or Preferred Stock ranking
senior to, on a parity with or junior to Preferred Stock as to dividends and
upon liquidation, dissolution or winding-up shall not be deemed materially
adversely to affect such powers, preferences or special rights.
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MISCELLANEOUS
The Holders of Offered Preferred Stock will have no preemptive rights.
Offered Preferred Stock, upon issuance against full payment of the purchase
price therefor, will be fully paid and nonassessable. Shares of Offered
Preferred Stock redeemed or otherwise reacquired by the Corporation shall resume
the status of authorized and unissued shares of Preferred Stock undesignated as
to series and shall be available for subsequent issuance. There are no
restrictions on repurchase or redemption of Offered Preferred Stock while there
is any arrearage on sinking fund installments except as may be set forth in an
applicable Certificate of Amendment and Prospectus Supplement. The liquidation
preference is not necessarily indicative of the price at which the Offered
Preferred Stock actually will trade on or after the date of issuance. Payment of
dividends on any series of Offered Preferred Stock may be restricted by loan
agreements, indentures and other transactions heretofore or hereafter entered
into by the Corporation. The accompanying Prospectus Supplement or information
incorporated by reference will describe any material contractual restrictions on
dividend payments.
NO OTHER RIGHTS
The shares of a series of Offered Preferred Stock will have only those
preferences, voting powers and relative, participating, optional or other
special rights as are set forth above or in the applicable Certificate of
Amendment and Prospectus Supplement, the Articles of Incorporation or as
otherwise required by law.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for each series of Offered Preferred Stock
will be designated in the applicable Prospectus Supplement.
DEPOSITARY SHARES
GENERAL
The Corporation may, at its option, elect to offer fractional shares of
Offered Preferred Stock (the "Depositary Shares"), rather than full shares of
Offered Preferred Stock. As described below, in the event such election is made,
the Corporation will issue receipts for Depositary Shares, each of which will
represent a fraction of a share of a particular series of Offered Preferred
Stock as set forth in the applicable Prospectus Supplement.
The shares of any series of Offered Preferred Stock represented by
Depositary Shares will be deposited under a Deposit Agreement (the "Deposit
Agreement") among the Corporation, a depositary to be named in the applicable
Prospectus Supplement (the "Preferred Stock Depositary") and the Holders from
time to time of depositary receipts evidencing Depositary Shares issued pursuant
to the Deposit Agreement (the "Depositary Receipts"). Subject to the terms of
the Deposit Agreement, each Holder of a Depositary Share will be entitled, in
proportion to the applicable fraction of a share of Offered Preferred Stock
represented by such Depositary Share, to all the rights and preferences of
Offered Preferred Stock represented thereby (including without limitation,
dividend, voting, redemption, conversion and liquidation rights).
Depositary Receipts will be distributed to those persons purchasing the
fractional shares of the related series of Offered Preferred Stock. The forms of
Deposit Agreement and Depositary Receipt will be filed as exhibits to or
incorporated by reference into the Registration Statement of which this
Prospectus is a part at or prior to the time of issuance of such Depository
Receipts. Immediately following the issuance of shares of a series of Offered
Preferred Stock by the Corporation, the Corporation will deposit such shares
with the Preferred Stock Depositary, which will then issue and deliver
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Depositary Receipts to the purchasers thereof. Depositary Receipts will be
issued evidencing only whole Depositary Shares and each may evidence any number
of whole Depositary Shares.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Preferred Stock Depositary will distribute all cash dividends or other
cash distributions received in respect of the related series of Offered
Preferred Stock to the record holders of Depositary Shares relating to such
series of Offered Preferred Stock in proportion to the number of such Depositary
Shares owned by such Holders.
The Preferred Stock Depositary will distribute any non-cash distribution
received by it to the record Holders of Depositary Shares entitled thereto in
proportion to the number of Depositary Shares owned by such holders, unless the
Preferred Stock Depositary determines that such distribution cannot be made
proportionately among such Holders or that it is not feasible to make such
distributions, in which case the Preferred Stock Depositary may, with the
approval of the Corporation, adopt such method as it deems equitable and
practicable for the purpose of effecting such distribution, including the sale
(at public or private sale) of the securities or other property thus received,
or any part thereof, at such place or places and upon such terms as it may deem
proper.
The amounts distributed in any of the foregoing cases will be reduced by any
amounts required to be withheld by the Corporation or the Preferred Stock
Depositary on account of taxes or other governmental charges.
REDEMPTION OF DEPOSITARY SHARES
If a series of Offered Preferred Stock underlying the Depositary Shares is
subject to redemption, the Depositary Shares will be redeemed from the proceeds
received by the Preferred Stock Depositary resulting from any redemption, in
whole or in part, of such series of Preferred Stock held by the Preferred Stock
Depositary. The redemption price per Depositary Share will be equal to the
applicable fraction of the redemption price per share payable with respect to
such series of Offered Preferred Stock. If the Corporation redeems shares of a
series of Offered Preferred Stock held by the Preferred Stock Depositary, the
Preferred Stock Depositary will redeem as of the same redemption date the number
of Depositary Shares representing the shares of Offered Preferred Stock so
redeemed. If less than all the Depositary Shares are to be redeemed, the
Depositary Shares to be redeemed will be selected by lot or substantially
equivalent method determined by the Preferred Stock Depositary.
After the date fixed for redemption, the Depositary Shares called for
redemption no longer will be deemed to be outstanding, and all rights of the
Holders of the Depositary Shares will cease, except the right to receive the
money or other property payable upon such redemption and any money or other
property to which the Holders of such Depositary Shares were entitled upon such
redemption, upon surrender to the Preferred Stock Depositary of the Depositary
Receipts evidencing such Depositary Shares. Any funds deposited by the
Corporation with the Preferred Stock Depositary for any Depositary Shares that
the Holders thereof fail to redeem will be returned to the Corporation after a
period of two years from the date such funds are so deposited.
VOTING THE PREFERRED STOCK
Upon receipt of notice of any meeting at which the Holders of any series of
Offered Preferred Stock are entitled to vote, the Preferred Stock Depositary
will mail the information contained in such notice of meeting to the record
Holders of the Depositary Shares relating to such series of Offered Preferred
Stock. Each record Holder of such Depositary Shares on the record date (which
will be the same date as the record date for the related series of Offered
Preferred Stock) will be entitled to instruct the Preferred Stock Depositary as
to the exercise of the voting rights pertaining to the number of shares of the
series of
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Offered Preferred Stock represented by such Holder's Depositary Shares. The
Preferred Stock Depositary will endeavor, insofar as practicable, to vote or
cause to be voted the number of shares of Offered Preferred Stock represented by
such Depositary Shares in accordance with such instructions, provided the
Preferred Stock Depositary receives such instructions sufficiently in advance of
such meeting to enable it to so vote or cause to be voted the shares of Offered
Preferred Stock, and the Corporation will agree to take all reasonable action
that may be deemed necessary by the Preferred Stock Depositary in order to
enable the Preferred Stock Depositary to do so. The Preferred Stock Depositary
will abstain from voting shares of Offered Preferred Stock to the extent it does
not receive specific instructions from the Holders of Depositary Shares
representing such Offered Preferred Stock.
WITHDRAWAL OF PREFERRED STOCK
Upon surrender of the Depositary Receipts at the corporate trust office of
the Preferred Stock Depositary and upon payment of the taxes, charges and fees,
if any, provided for in the Deposit Agreement and subject to the terms thereof,
the Holder of the Depositary Shares evidenced thereby will be entitled to
delivery at such office, to or upon such Holder's order, of the number of whole
shares of the related series of Offered Preferred Stock and any money or other
property, if any, represented by such Depositary Shares. Holders of Depositary
Shares will be entitled to receive whole shares of the related series of Offered
Preferred Stock, but Holders of such whole shares of Offered Preferred Stock
will not be entitled thereafter to deposit such shares of Offered Preferred
Stock with the Preferred Stock Depositary or to receive Depositary Shares
therefor. If the Depositary Receipts delivered by the Holder evidence a number
of Depositary Shares in excess of the number of Depositary Shares representing
the number of whole shares of the related series of Offered Preferred Stock to
be withdrawn, the Preferred Stock Depositary will deliver to such Holder or upon
such Holder's order at the same time a new Depositary Receipt evidencing such
excess number of Depositary Shares.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provisions of the Deposit Agreement may at any time and from time to time be
amended by agreement between the Corporation and the Preferred Stock Depositary.
However, any amendment that materially adversely affects the rights of the
Holders of Depositary Shares will not be effective unless such amendment has
been approved by the Holders of at least a majority of the Depositary Shares
then outstanding. Every Holder of a Depositary Receipt at the time such
amendment becomes effective will be deemed, by continuing to hold such
Depositary Receipt, to be bound by the Deposit Agreement as so amended.
Notwithstanding the foregoing, in no event may any amendment impair the right of
any Holder of any Depositary Shares, upon surrender of the Depositary Receipts
evidencing such Depositary Shares and subject to any conditions specified in the
Deposit Agreement, to receive shares of the related series of Offered Preferred
Stock and any money or other property, if any, represented thereby, except in
order to comply with mandatory provisions of applicable law. The Deposit
Agreement may be terminated by the Corporation at any time upon not less than 60
days' prior written notice to the Preferred Stock Depositary, in which case, on
a date that is not later than 30 days after the date of such notice to the
Preferred Stock Depositary shall deliver or make available for delivery to
Holders of Depositary Shares, upon surrender of the Depositary Receipts
evidencing such Depositary Shares, such number of whole or fractional shares of
the related series of Offered Preferred Stock as are represented by such
Depositary Shares. The Deposit Agreement shall terminate automatically after all
outstanding Depositary Shares have been redeemed or there has been a final
distribution in respect of the related series of Offered Preferred Stock in
connection with any liquidation, dissolution or winding-up of the Corporation
and such final distribution has been distributed to the Holders of Depositary
Shares.
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CHARGES OF DEPOSITARY
The Corporation will pay all transfer and other taxes and the governmental
charges arising solely from the existence of the depositary arrangements. The
Corporation will pay the charges of the Preferred Stock Depositary, including
charges in connection with the initial deposit of the related series of Offered
Preferred Stock and the initial issuance of the Depositary Shares and all
withdrawals of shares of the related series of Offered Preferred Stock, except
that Holders of Depositary Shares will pay transfer and other taxes and
governmental charges and such other charges as are expressly provided in the
Deposit Agreement to be for their accounts.
RESIGNATION AND REMOVAL OF DEPOSITARY
The Preferred Stock Depositary may resign at any time by delivering to the
Corporation written notice of its election to do so, and the Corporation may at
any time remove the Depositary, any such resignation or removal to take effect
upon the appointment of a successor Preferred Stock Depositary, which successor
Preferred Stock Depositary must be appointed within 60 days after delivery of
the notice of resignation or removal and must be a bank or trust corporation
having its principal office in the United States and having a combined capital
and surplus of at least $50,000,000.
MISCELLANEOUS
The Preferred Stock Depositary will forward to the Holders of Depositary
Shares all reports and communications from the Corporation that are delivered to
the Preferred Stock Depositary and which the Corporation is required to furnish
to the Holders of the Offered Preferred Stock.
Neither the Preferred Stock Depositary nor the Corporation will be liable if
it is prevented or delayed by law or any circumstance beyond its control in
performing its obligations under the Deposit Agreement. The obligations of the
Corporation and the Preferred Stock Depositary under the Deposit Agreement will
be limited to performance with best judgment and in the good faith of their
duties thereunder, except that they are liable for gross negligence and willful
misconduct in the performance of their duties thereunder, and they will not be
obligated to appear in, prosecute or defend any legal proceeding in respect of
any Depositary Receipts, Depositary Shares or series of Offered Preferred Stock
unless indemnity, satisfactory in their sole discretion is furnished. The
Preferred Stock Depositary and the Corporation may rely on advice of legal
counsel or accountants of their choice, or information provided by persons
presenting Preferred Stock for deposit, Holders of Depositary Shares or other
persons believed in good faith to be competent and on documents believed to be
genuine.
The Preferred Stock Depositary's corporate trust office will be identified
in the applicable Prospectus Supplement and unless otherwise set forth in the
applicable Prospectus Supplement will act as transfer agent and registrar for
Depositary Receipts; if shares of a series of Offered Preferred Stock are
redeemable, the Preferred Stock Depositary also will act as redemption agent for
the corresponding Depositary Receipts.
COMMON STOCK
Except as otherwise provided by law, the holders of Common Stock are
entitled to one vote for each share held of record on all matters submitted to a
vote of stockholders. There are no cumulative voting rights with respect to the
election of directors. Holders of Common Stock are entitled to receive ratably
such dividends as may be declared by the Board of Directors out of legally
available funds. In the event of dissolution of the Corporation, they will be
entitled to share ratably in all assets remaining after payment of liabilities
and amounts owed in respect of outstanding Offered Preferred Stock. Holders of
Common Stock have no preemptive rights and have no right to convert their Common
Stock into any other securities.
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The transfer agent and registrar for the Common Stock is The Bank of New
York.
CERTAIN PROVISIONS OF ARTICLES OF INCORPORATION AND VIRGINIA LAW
The Articles of Incorporation contains certain provisions that may have an
effect of delaying, deferring or preventing a change of control of the
Corporation. These provisions, together with any provisions in the terms of any
Preferred Stock which may be issued in the future which make an acquisition of
the Corporation more difficult, could also have the effect of causing the
Corporation's Common Stock to trade at a lower price in the open market than it
would if such provisions did not exist. The Articles of Incorporation provide
that the Board shall consist of three classes of directors, each such class
serving a three-year term ending in a successive year. This provision may make
it more difficult to effect a takeover of the Corporation because it generally
would take two annual meetings of stockholders for an acquiring party to elect a
majority of the Board. As a result, the classified Board may discourage proxy
contests for the election of directors or purchases of a substantial block of
stock because such classification could operate to prevent obtaining control of
the Board in a relatively short period of time.
In addition, the Virginia Stock Corporation Act (the "Virginia SCA")
restricts transactions between a corporation and certain affiliates and
potential acquirors. The summary of those material provisions thereof set forth
below is necessarily general and is not intended to be a complete description of
all the features and consequences of those provisions, and it is qualified in
its entirety by reference to the statutory provisions contained in the Virginia
SCA.
AFFILIATED TRANSACTIONS
Sections 13.1-725-727.1 of the Virginia SCA govern "Affiliated
Transactions." Affiliated Transactions include certain mergers and share
exchanges, certain material dispositions of corporate assets not in the ordinary
course of business, any dissolution of a corporation proposed by or on behalf of
an Interested Shareholder (defined as any beneficial owner of more than 10% of
any class of the voting securities of a Virginia corporation) and
reclassifications, including reverse stock splits, recapitalizations or mergers
of a corporation with its subsidiaries, or distributions or other transactions
that have the effect of increasing the percentage of voting shares beneficially
owned by an Interested Shareholder by more than 5%.
Subject to certain exceptions discussed below, the provisions governing
Affiliated Transactions require that, during three years following the date upon
which any stockholder becomes an Interested Shareholder, any Affiliated
Transaction must be approved by the affirmative vote of holders of two thirds of
the outstanding shares of the corporation entitled to vote, other than the
shares beneficially owned by the Interested Shareholder, and by a majority (but
not less than two) of the Disinterested Directors. A Disinterested Director is
defined as a member of a corporation's board of directors who (i) was a member
before the later of (a) January 1, 1988 and (b) the date on which an Interested
Shareholder became an Interested Shareholder and (ii) was recommended for
election by, or was elected to fill a vacancy and received the affirmative vote
of, a majority of the Disinterested Directors then on such corporation's board
of directors.
At the expiration of the three-year period after a stockholder becomes an
Interested Shareholder, an Affiliated Transaction generally must be approved by
the affirmative vote of the holders of two thirds of the outstanding shares of
the corporation entitled to vote, other than those beneficially owned by the
Interested Shareholder. The principal exceptions to this voting requirement are
either that the transaction be approved by a majority of the corporation's
Disinterested Directors or that the transaction satisfy certain fair price
requirements of the statute. In general, the fair price requirements provide
that the stockholders must receive the highest per share price for their shares
that was paid by the Interested Shareholder for its shares or the fair market
value of the shares. The fair price requirements also
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mandate that, during the three years preceding the announcement of the proposed
Affiliated Transaction, all required dividends have been paid and no special
financial accommodations have been accorded the Interested Shareholder, unless
approved by a majority of the Disinterested Directors.
None of the foregoing limitations and special voting requirements applies,
INTER ALIA, to a transaction with an Interested Shareholder who has been an
Interested Shareholder continuously since January 26, 1988 or who became an
Interested Shareholder by gift or inheritance from such a person or whose
acquisition of shares making such person an Interested Shareholder was approved
by a majority of the Disinterested Directors of the corporation.
These provisions were designed to deter certain takeovers of Virginia
corporations. In addition, the Virginia SCA provides that, by affirmative vote
of the majority of the voting shares other than shares owned by an Interested
Shareholder, a corporation may adopt, by meeting certain voting requirements, an
amendment to its articles of incorporation or bylaws providing that the
Affiliated Transactions provisions shall not apply to the corporation. The
Corporation has not adopted such an amendment.
Currently, no stockholder of the Corporation owns or controls 10% or more of
the Corporation's Common Stock, and there are no Interested Shareholders as
defined by the Virginia SCA.
CONTROL SHARE ACQUISITIONS
Sections 13.1-728-728.8 of the Virginia SCA governing Control Share
Acquisitions also is designed to afford stockholders of a public corporation
incorporated in Virginia protection against certain types of non-negotiated
acquisitions in which a person, entity or group ("Acquiring Person") seeks to
gain voting control of that corporation. With certain enumerated exceptions, the
statute applies to acquisitions of shares of a corporation that would result in
an Acquiring Person's ownership of the corporation's shares entitled to vote in
the election of directors falling within any one of the following ranges: 20% to
33-1/3%, 33-1/3% to 50% or 50% or more (each, a "Control Share Acquisition").
Shares that are the subject of a Control Share Acquisition ("Control Shares")
will not be entitled to voting rights unless the holders of a majority of the
"Disinterested Shares" vote at an annual or special meeting of stockholders of
the corporation to give Control Shares voting rights. Disinterested Shares do
not include shares owned by the Acquiring Person or by officers and inside
directors of the target corporation.
Under certain circumstances, the statute permits an Acquiring Person to
require the directors to call a special stockholders' meeting for the purpose of
considering granting voting rights to Control Shares. As a condition to having
this matter considered at either an annual or special meeting, the Acquiring
Person must provide stockholders with detailed disclosures about its identity,
the method and financing of the Control Share Acquisition and any plans to
engage in certain transactions with, or to make fundamental changes to, the
corporation, its management or business. Under certain circumstances, the
statute grants dissenters' rights to stockholders who vote against granting
voting rights to Control Shares. The Virginia Control Share Acquisitions statute
also enables a corporation to make provisions for redemption of Control Shares
with no voting rights.
Among the acquisitions specifically excluded from the statute are
acquisitions that are part of certain negotiated transactions to which the
corporation is a party and that, in the case of mergers or share exchanges, have
been approved by the corporation's stockholders under other provisions of the
Virginia SCA.
A corporation may opt-out of the statute, which the Corporation has not
done, by so providing in its articles of incorporation or bylaws.
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PLAN OF DISTRIBUTION
The Corporation may sell Securities to one or more underwriters for public
offering and sale by them or may sell Securities to investors directly or
through agents. Any such underwriter or agent involved in the offer and sale of
the Securities will be named in the Prospectus Supplement.
Underwriters may offer and sell Securities at a fixed price or prices, which
may be changed, or from time to time at market prices prevailing at the time of
sale, at prices related to such prevailing market prices or at negotiated
prices. The Corporation also may offer and sell Securities in exchange for one
or more of its outstanding issues of debt. The Corporation from time to time
also may authorize underwriters acting as the Corporation's agents to offer and
sell Securities upon terms and conditions set forth in any Prospectus
Supplement. In connection with the sale of Securities, underwriters may be
deemed to have received compensation from the Corporation in the form of
underwriting discounts or commissions and also may receive commissions from
purchasers of Securities for whom they may act as agent. Underwriters may sell
Securities to or through dealers, and such dealers may receive compensation in
the form of discounts, concessions or commissions from the underwriters and/or
commissions from the purchasers for whom they may act as agent.
Any underwriting compensation paid by the Corporation to underwriters or
agents in connection with the offering of Securities, and any discounts,
concessions or commissions allowed by underwriters to participating dealers,
will be set forth in the applicable Prospectus Supplement. Underwriters, dealers
and agents participating in the distribution of Securities may be deemed to be
underwriters, and any discounts and commissions received by them and any profit
realized by them on resale of the Securities may be deemed to be underwriting
discounts and commissions under the Act.
Underwriters, dealers and agents may be entitled, under agreements entered
into with the Corporation, to indemnification against and contribution toward
certain civil liabilities, including liabilities under the Act.
LEGAL MATTERS
The validity of the Securities will be passed upon for the Corporation by
William A. Noell, Jr., Esq., Corporate Counsel for the Corporation, Norfolk,
Virginia, (or by such other senior corporate counsel as may be designated by the
Corporation) and for any underwriters by counsel named in the applicable
Prospectus Supplement. Mr. Noell, in his capacity as Corporate Counsel for the
Corporation, is a participant in various employee benefit and incentive plans,
including stock option plans, offered to employees of the Corporation.
EXPERTS
The consolidated financial statements and schedule of the Corporation as of
December 31, 1996 and 1995, and for each of the three years in the three-year
period ended December 31, 1996, have been incorporated by reference herein and
in the Registration Statement in reliance upon the report incorporated by
reference herein of KPMG Peat Marwick LLP, independent certified public
accountants, and upon the authority of said firm as experts in accounting and
auditing. The consolidated financial statements of Conrail as of December 31,
1996 and 1995, and for each of the years in the three-year period ended December
31, 1996, have been incorporated by reference herein and in the Registration
Statement in reliance upon the report of Price Waterhouse LLP, independent
accountants, given upon the authority of said firm as experts in accounting and
auditing.
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PART II
ITEM 16. EXHIBITS
The following exhibits are filed as part of this Registration Statement:
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ----------- --------------------------------------------------------------------------------------------------------
<C> <S>
1.1 Form of Distribution Agreement; incorporated by reference to Exhibit 1 to Registrant's Registration
Statement on Form S-3 (No. 33-38595).
1.2 Form of Underwriting Agreement for Debt Securities will be filed as an exhibit to a Current Report of
the Registrant on Form 8-K and incorporated herein by reference.
1.3 Form of Underwriting Agreement for Preferred Stock, Common Stock and Depositary Receipts will be filed
as an exhibit to a Current Report of the Registrant on Form 8-K and incorporated herein by reference.
4.1 Senior Indenture, dated January 15, 1991, between the Registrant and First Trust of New York, National
Association, as successor to the trustee; incorporated by reference to Exhibit 4.1 to Registrant's
Registration Statement on Form S-3 (No. 33-38595).
4.2 Form of Subordinated Indenture between the Registrant and First Trust of New York, National Association
as trustee; incorporated by reference to Exhibit 4.2 to Registrant's Registration Statement on Form S-3
(No. 333-20203).
4.3 The form or forms of Securities with respect to each particular series of Securities registered
hereunder will be filed as an exhibit to a Current Report of the Registrant on Form 8-K and incorporated
herein by reference.
4.4 Form of Depositary Agreement for depositary shares will be filed as an exhibit to a current report of
the Registrant on Form 8-K and incorporated herein by reference with respect to any particular series of
Depositary Shares offered pursuant hereto.
5.1 Opinion of William A. Noell, Jr., Esq., Corporate Counsel of the Registrant will be filed as an exhibit
to a Current Report of the Registrant on Form 8-K and incorporated herein by reference with respect to
any particular offering of securities pursuant hereto.
5.2 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP will be filed as an exhibit to a Current Report of
the Registrant on Form 8-K and incorporated herein by reference with respect to any particular offering
of securities pursuant hereto.
12.1 Computation of Consolidated Ratio of Earnings to Fixed Charges.*
23.1 Consent of William A. Noell, Jr., Esq., Corporate Counsel of the Registrant (included in Exhibit 5.1).
23.2 Consent of KPMG Peat Marwick LLP.
23.3 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit 5.2).
23.4 Consent of Price Waterhouse LLP.
24.1 Powers of Attorney*
25.1 Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of First Trust of
New York, National Association, as successor to the Trustee with respect to the Senior Indenture and as
trustee with respect to the Subordinated Indenture.*
</TABLE>
- ------------------------
* Previously filed.
II-1
<PAGE>
ITEM 17. UNDERTAKINGS
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) above do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant pursuant to
Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment shall be deemed to be a new
Registration Statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Securities Act
of 1933, each filing of the Registrant's annual report pursuant to Section 13(a)
or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference in this
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(5) That, for purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Corporation pursuant to the foregoing provisions, or otherwise, the Corporation
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Corporation of expenses incurred
or paid by a director, officer or controlling person of the Corporation in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Corporation will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
II-2
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
has duly caused this Amendment to its Registration Statement on Form S-3 to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City
of Norfolk, Commonwealth of Virginia, on May 1, 1997.
NORFOLK SOUTHERN CORPORATION
By: /*/ DAVID R. GOODE
-----------------------------------------
David R. Goode
Chairman, President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities stated below on May 1, 1997.
SIGNATURE TITLE
- ------------------------------ ---------------------------
Chairman, President and
/*/ DAVID R. GOODE Chief Executive Officer
- ------------------------------ and Director (Principal
David R. Goode Executive Officer)
/*/ HENRY C. WOLF Executive Vice President --
- ------------------------------ Finance (Principal
Henry C. Wolf Financial Officer)
/*/ JOHN P. RATHBONE Vice President and
- ------------------------------ Controller (Principal
John P. Rathbone Accounting Officer)
/*/ GERALD L. BALILES Director
- ------------------------------
Gerald L. Baliles
/*/ CARROLL A. CAMPBELL, JR. Director
- ------------------------------
Carroll A. Campbell, Jr.
/*/ L. E. COLEMAN Director
- ------------------------------
L. E. Coleman
/*/ T. MARSHALL HAHN, JR. Director
- ------------------------------
T. Marshall Hahn, Jr.
/*/ LANDON HILLIARD Director
- ------------------------------
Landon Hilliard
/*/ E. B. LEISENRING, JR. Director
- ------------------------------
E. B. Leisenring, Jr.
/*/ ARNOLD B. MCKINNON Director
- ------------------------------
Arnold B. McKinnon
/*/ JANE MARGARET O'BRIEN Director
- ------------------------------
Jane Margaret O'Brien
/*/ HAROLD W. POTE Director
- ------------------------------
Harold W. Pote
<TABLE>
<S> <C>
*By: /s/ WILLIAM J. ROMIG
-------------------------------------------
William J. Romig
ATTORNEY-IN-FACT
</TABLE>
S-1
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE
- ----------- ------------------------------------------------------------------------------------------------ -----
<C> <S> <C>
1.1 Form of Distribution Agreement; incorporated by reference to Exhibit 1 to Registrant's
Registration Statement on Form S-3 (No. 33-38595).
1.2 Form of Underwriting Agreement for Debt Securities will be filed as an exhibit to a Current
Report of the Registrant on Form 8-K and incorporated herein by reference.
1.3 Form of Underwriting Agreement for Preferred Stock, Common Stock and Depositary Receipts will be
filed as an exhibit to a Current Report of the Registrant on Form 8-K and incorporated herein by
reference.
4.1 Senior Indenture, dated January 15, 1991, between the Registrant and First Trust of New York,
National Association, as successor to the trustee; incorporated by reference to Exhibit 4.1 to
Registrant's Registration Statement on Form S-3 (No. 33-38595).
4.2 Form of Subordinated Indenture between the Registrant and First Trust of New York, National
Association as trustee; incorporated by reference to Exhibit 4.2 to Registrant's Registration
Statement on Form S-3 (No. 333-20203).
4.3 The form or forms of Securities with respect to each particular series of Securities registered
hereunder will be filed as an exhibit to a Current Report of the Registrant on Form 8-K and
incorporated herein by reference.
4.4 Form of Depositary Agreement for depositary shares will be filed as an exhibit to a current
report of the Registrant on Form 8-K and incorporated herein by reference with respect to any
particular series of Depositary Shares offered pursuant hereto.
5.1 Opinion of William A. Noell, Jr., Esq., Corporate Counsel of the Registrant will be filed as an
exhibit to a Current Report of the Registrant on Form 8-K and incorporated herein by reference
with respect to any particular offering of securities pursuant hereto.
5.2 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP will be filed as an exhibit to a Current
Report of the Registrant on Form 8-K and incorporated herein by reference with respect to any
particular offering of securities pursuant hereto.
12.1 Computation of Consolidated Ratio of Earnings to Fixed Charges.*
23.1 Consent of William A. Noell, Jr., Esq., Corporate Counsel of the Registrant (included in Exhibit
5.1).
23.2 Consent of KPMG Peat Marwick LLP.
23.3 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit 5.2).
23.4 Consent of Price Waterhouse LLP.
24.1 Powers of Attorney.*
25.1 Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939, as amended, of First
Trust of New York, National Association, as successor to the Trustee with respect to the Senior
Indenture and as trustee with respect to the Subordinated Indenture.*
</TABLE>
- ------------------------
* Previously filed
<PAGE>
EXHIBIT 23.2
The Board of Directors
NORFOLK SOUTHERN CORPORATION:
We consent to incorporation by reference in the registration statement on Form
S-3 of Norfolk Southern Corporation of our report dated as of January 28, 1997,
except as to the second and third paragraphs of Note 15, which are as of
February 12, 1997, relating to the consolidated balance sheets of Norfolk
Southern Corporation and subsidiaries as of December 31, 1996, and 1995, and the
related consolidated statements of income, changes in stockholders' equity, and
cash flows for each of the years in the three-year period ended December 31,
1996, and the related consolidated financial statement schedule, which report
appears in the December 31, 1996, annual report on Form 10-K of Norfolk Southern
Corporation and subsidiaries. We also consent to the reference to our firm under
the heading "Experts" in the prospectus.
KPMG PEAT MARWICK LLP
Norfolk, Virginia
April 30, 1997
<PAGE>
EXHIBIT 23.4
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of Norfolk Southern
Corporation of our report dated January 21, 1997, except as to Note 2, which is
as of March 7, 1997, on the consolidated financial statements of Conrail Inc.
for the year ended December 31, 1996, appearing on page 6 of Norfolk Southern
Corporation's Form 8-K/A filing dated May 1, 1997. We also consent to the
reference to us under the heading "Experts" in such Prospectus.
PRICE WATERHOUSE LLP
Thirty South Seventeenth Street
Philadelphia, PA 19103
May 1, 1997
