<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-----------
FORM 11-K
ANNUAL REPORT
PURSUANT TO SECTION 15(d)OF THE
SECURITIES EXCHANGE ACT OF 1934
[X] ANNUAL REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE ACT
OF 1934.
For the fiscal year ended: December 31, 1998.
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934.
For the transition period from ________ to ____________
Commission file number: 001-13275
A. Full title of the plan and the address of the plan, if different
from that of the issuer named below:
OUTDOOR SYSTEMS, INC. 401(K) PLAN
2502 N. Black Canyon Highway
Phoenix, Arizona 85009
B. Name of issuer of the securities held pursuant to the plan and the
address of its principal executive office:
OUTDOOR SYSTEMS, INC.
2502 N. Black Canyon Highway
Phoenix, Arizona 85009
<PAGE> 2
Financial Statements and Exhibits
(a) Financial Statements
The Outdoor Systems, Inc. 401(k) Plan (the "Plan") became effective as of
January 1, 1987. Filed as a part of this report on Form 11-K are the audited
financial statements of the Plan as of and for the year ended December 31, 1998.
(b) Exhibit
(23) Consent of Independent Auditors
2
<PAGE> 3
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of 1934,
the trustees (or other persons who administer the employee benefit plan) have
duly caused this annual report to be signed on its behalf by the undersigned
thereunto duly authorized.
OUTDOOR SYSTEMS, INC. 401(k) PLAN
By: Outdoor Systems, Inc., Plan Administrator
By: /s/ William S. Levine
-----------------------------
William S. Levine
Chairman of the Board
Dated: June 29, 1999
3
<PAGE> 4
OUTDOOR SYSTEMS, INC. 401(k) PLAN
Financial Statements
Years Ended December 31, 1998 and 1997,
Supplemental Schedules
Year Ended December 31, 1998, and
Independent Auditors' Report
<PAGE> 5
OUTDOOR SYSTEMS, INC.
401(k) PLAN
TABLE OF CONTENTS
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
INDEPENDENT AUDITORS' REPORT F-1 - F-2
FINANCIAL STATEMENTS FOR THE YEARS ENDED
DECEMBER 31, 1998 AND 1997:
Statements of Net Assets Available for Benefits F-3
Statements of Changes in Net Assets Available for Benefits F-4
Notes to Financial Statements F-5 - F-12
SUPPLEMENTAL SCHEDULES FOR THE YEAR ENDED
DECEMBER 31, 1998:
Item 27a - Assets Held for Investment Purposes F-13 - F-15
Item 27d - Reportable Transactions F-16
</TABLE>
<PAGE> 6
INDEPENDENT AUDITORS' REPORT
Board of Trustees
Outdoor Systems, Inc. 401(k) Plan
Phoenix, Arizona
We have audited the accompanying statements of net assets available for benefits
of Outdoor Systems, Inc. 401(k) Plan (the "Plan") as of December 31, 1998 and
1997, and the related statements of changes in net assets available for benefits
for the years then ended. These financial statements are the responsibility of
the Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the net assets available for benefits of the Plan as of December 31,
1998 and 1997, and the changes in net assets available for benefits for the
years then ended in conformity with generally accepted accounting principles.
As discussed in Notes 2 and 4 to the financial statements, the 1998 and 1997
financial statements include investments valued at $794,205 (5 percent of net
assets) and $736,874 (6 percent of net assets), respectively, whose values have
been estimated by the Board of Trustees in the absence of readily ascertainable
market values. We have examined the procedures used by the Board of Trustees in
arriving at its estimate of the value of such investments and have inspected
underlying documentation, and in the circumstances, we believe that such
procedures are reasonable and the documentation appropriate. However, because of
the inherent uncertainty of valuation, those estimated values may differ
significantly from the values that would have been used had a ready market for
the investments existed, and the differences could be material.
F-1
<PAGE> 7
Our audits were conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The accompanying supplemental schedules
listed in the Table of Contents are presented for the purpose of additional
analysis and are not a required part of the basic financial statements, but are
supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. These supplemental schedules are the responsibility of the
Plan's management. Such supplemental schedules have been subjected to the
auditing procedures applied in our audit of the basic 1998 financial statements
and, in our opinion, are fairly stated in all material respects when considered
in relation to the basic financial statements taken as a whole.
The schedule of assets held for investment purposes that accompanies the Plan's
financial statements does not disclose the historical cost of certain Plan
assets held by the Plan Custodian. Disclosure of this information is required by
the Department of Labor's Rules and Regulations for Reporting and Disclosure
under the Employee Retirement Income Security Act of 1974.
Deloitte & Touche LLP
Phoenix, Arizona
May 30, 1999
F-2
<PAGE> 8
OUTDOOR SYSTEMS, INC.
401(k) PLAN
STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1998 AND 1997
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
ASSETS 1998 1997
- ------ ---- ----
<S> <C> <C>
INVESTMENTS AT FAIR VALUE:
Shares of registered investment companies:
The Dreyfus A Bonds Plus Fund $ 608,094 $ 513,884
The Fidelity Advisor Growth Opportunities Fund 2,209,953 1,332,387
The Fidelity Advisor High Yield A Fund 825,462 716,089
The Fidelity Asset Manager Fund 18,529 10,554
Federated Bond Fund 7,934
Nationwide Fund 54,266
The Neuberger & Berman Partners Trust Fund 1,345,026 989,571
The Twentieth Century Ultra Investors Fund 2,547,571 1,405,069
The Templeton Foreign Fund 1,574,916 1,464,238
The Fixed Account Fund 695,171 574,453
The Warburg Pincus Emerging Growth Fund 1,673,302 1,367,693
The Neuberger & Berman Guardian Trust Fund 1,304,948 1,103,125
The Nationwide Money Market Fund 436,368 736,297
Personal Portfolio 3,786
Common stock:
The Outdoor Systems Common Stock Fund 553,778 178,817
Deeds of trust 794,205 736,874
Participant loans 661,945 510,401
----------- -----------
Total investments at fair value 15,315,254 11,639,452
----------- -----------
CONTRIBUTIONS RECEIVABLE:
Employer 386,672 285,224
Participant 37,891
----------- -----------
Total contributions receivable 386,672 323,115
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS $15,701,926 $11,962,567
=========== ===========
</TABLE>
See notes to financial statements.
F-3
<PAGE> 9
OUTDOOR SYSTEMS, INC.
401(k) PLAN
STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED DECEMBER 31, 1998 AND 1997
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
1998 1997
----------- -----------
<S> <C> <C>
ADDITIONS:
Investment income:
Net appreciation in fair value of investments $ 1,084,789 $ 1,101,248
Interest 162,876 124,092
----------- -----------
Total investment income 1,247,665 1,225,340
----------- -----------
Contributions:
Participant 3,177,276 2,132,491
Employer 386,672 285,224
----------- -----------
Total contributions 3,563,948 2,417,715
----------- -----------
Transfer of assets 1,406,080
----------- -----------
Total additions 4,811,613 5,049,135
----------- -----------
DEDUCTIONS - Benefits paid to participants 1,072,254 666,618
----------- -----------
NET INCREASE 3,739,359 4,382,517
NET ASSETS AVAILABLE FOR BENEFITS,
BEGINNING OF YEAR 11,962,567 7,580,050
----------- -----------
NET ASSETS AVAILABLE FOR BENEFITS,
END OF YEAR $15,701,926 $11,962,567
=========== ===========
</TABLE>
See notes to financial statements.
F-4
<PAGE> 10
OUTDOOR SYSTEMS, INC.
401(k) PLAN
NOTES TO FINANCIAL STATEMENTS
YEARS ENDED DECEMBER 31, 1998 AND 1997
- --------------------------------------------------------------------------------
1. SUMMARY OF THE PLAN
The following summary of the Outdoor Systems, Inc. 401(k) Plan (the
"Plan") provides only general information. Participants should refer to
the Plan document for a more complete description of the Plan's
provisions.
a. General and Transfer of Assets - The Plan, established on January 1,
1987, is a defined contribution plan of Outdoor Systems, Inc. (the
"Company" or the "Employer"). It is subject to the provisions of the
Employee Retirement Income Security Act of 1974 ("ERISA"). In August
1997, account balances of those participants employed by the outdoor
advertising division of Minnesota Mining and Manufacturing Company
("3M") were transferred to the Plan in connection with the
acquisition of 3M by the Company.
b. Contributions - Plan contributions consist of three components: (1)
employee deferral contributions based on a participant's monthly
pretax compensation up to an annual before-tax dollar limitation,
(2) discretionary Employer contributions, as determined annually by
the Employer's Board of Directors, and (3) rollover contributions
representing qualifying lump-sum distributions received by a
participant from a plan sponsored by another employer. Forfeitures
representing the value of nonvested benefits of terminated
participants are reallocated to active participants of the Plan and
serve to reduce Employer contributions to the Plan in the year in
which employment terminates.
c. Eligibility and Vesting - The Plan is available to all eligible
non-union employees of the Company. Employees are eligible for
participation in the Plan after 90 days of qualifying service (as
defined in the Plan). Participants are immediately 100 percent
vested in their voluntary contributions and rollover contributions
plus actual earnings thereon. Vesting of Employer contributions plus
actual earnings thereon is based on years of service. Such vesting
commences upon date of hire (as defined in the Plan), with 100
percent vesting being attained after two years of service.
d. Participant Benefits and Distribution - The Employer contribution
and net investment income are allocated proportionally to individual
participant accounts in accordance with the provisions of the Plan.
Benefits provided by the Plan are paid from the net assets available
for benefits. Participants separated from the Plan due to service
retirement, total and permanent disability or death are
automatically fully vested in their Employer contributions and will
receive their benefits including their voluntary contributions and
rollover contributions in equal annual installments or a lump sum
payment. Participants separated from the Plan due to termination
receive a lump sum payment including the full value of their
voluntary contributions and rollover contributions and the vested
portion of their Employer contributions.
F-5
<PAGE> 11
e. Participant Loans - Participants may borrow from the Plan subject to
a maximum loan balance of the lesser of: (1) 50 percent of their
vested account balances or $10,000 if greater, or (2) $50,000
reduced by the excess of the highest outstanding loan balance during
the preceding 12-month period over the outstanding balance of loans
from the Plan to the participant on the date of the loan. All loans
must be repaid with interest within five years (however, loans used
to acquire a principal residence of the participant shall provide
for periodic repayment over a reasonable period of time that may
exceed five years). Interest rates for loans are determined
periodically by the Plan trustee.
f. Participant Accounts - For each participant, various accounts are
maintained to record participant contributions, employer
contributions and rollover deposits transferred to the Plan. The
benefit to which a participant is entitled is the total benefit
which can be provided from the combined amount of their participant
accounts.
g. Priorities Upon Termination of the Plan - Although the Employer has
not expressed any intent to do so, the Employer has the right to
terminate the Plan subject to the provisions of ERISA. In the event
that such termination was to occur, all the Employer contributions
would become fully vested.
2. SIGNIFICANT ACCOUNTING POLICIES
The following are the significant accounting policies used in the
preparation of the accompanying financial statements.
a. Investments - Plan investments are valued at fair value with the
exception of the deeds of trust and Fixed Account Fund. Except for
the Fixed Account Fund, the investments with Nationwide Insurance
Company represent pooled separate accounts which are governed under
a variable return contract consisting of numerous mutual fund
options with a range of investments objectives. Each participant in
the Plan is assigned a number of units based on the dollar amount
invested by the participant and the daily unit value of the selected
investment funds. A daily unit value is calculated for each
Nationwide Investment fund based on the net asset value of the
underlying mutual fund plus declared dividends and capital gains
distributions less asset management fees for the day.
The Fixed Account Fund is a guaranteed return contract that provides
an annual interest guarantee. The average yield and crediting
interest rate was 5.3 percent and 5.75 percent for 1998 and 1997,
respectively, and Nationwide has guaranteed 5.10 percent for 1999.
The Fixed Account Fund is valued at contract value, which
approximates fair value at December 31, 1998.
The deeds of trust have no secondary market and therefore, are
stated at their cost which management believes represents a
reasonable estimate of their fair market value.
The Plan offers participants the following funds, as described in
the individual fund's prospectus (except for the deeds of trust), to
invest pre-tax and rollover deposits:
1) THE DREYFUS A BONDS PLUS FUND - This fund primarily invests in
corporate bonds and notes and short-term securities.
2) THE FIDELITY ADVISOR GROWTH OPPORTUNITIES FUND - This fund
primarily invests in growth, cyclical and value stocks, and
securities convertible to common stocks. The fund may also
invest in other securities, such as preferred stocks and
bonds.
F-6
<PAGE> 12
3) THE FIDELITY ADVISOR HIGH YIELD A FUND - This fund primarily
invests in high-yielding, fixed income and zero coupon
securities, such as bonds, debentures and notes, convertible
securities and preferred stock.
4) THE FIDELITY ASSET MANAGER FUND - This fund primarily invests
in stocks, bonds and short-term instruments.
5) FEDERATED BOND FUND - This fund invests at least 65 percent of
its assets in investment-grade corporate bonds, U.S.
government securities, preferred stock, convertibles and cash.
It may invest up to 35 percent of assets in debt rated as low
as B. It may invest up to 25 percent in debt securities of
foreign governments.
6) NATIONWIDE FUND - This fund invests primarily in common
stocks, but may also include convertible issues, bonds and
money market instruments.
7) THE NEUBERGER & BERMAN PARTNERS TRUST FUND - This fund
primarily invests in common stocks, bonds, and debentures
believed to have potential for appreciation in value.
8) THE TWENTIETH CENTURY ULTRA INVESTORS FUND - This fund invests
primarily in domestic common stocks considered to have
better-than-average prospects for appreciation.
9) THE TEMPLETON FOREIGN FUND - This fund primarily invests in
stock and debt obligations of companies and governments
outside the United States.
10) THE FIXED ACCOUNT FUND - This fund represents investments in a
guaranteed return contract that provides an annual interest
guarantee.
11) THE WARBURG PINCUS EMERGING GROWTH FUND - This fund primarily
invests in equity securities of small-to-medium sized
companies in the United States.
12) THE NEUBERGER & BERMAN GUARDIAN TRUST FUND - This fund
primarily invests in stocks of established companies believed
to be undervalued in comparison to stocks of similar
companies.
13) THE NATIONWIDE MONEY MARKET FUND - This fund primarily invests
in commercial paper and U.S. Government obligations.
14) PERSONAL PORTFOLIO - These funds invest in balanced portfolios
of cash, bonds and stock.
15) THE OUTDOOR SYSTEMS COMMON STOCK FUND - This fund invests in
the common stock of Outdoor Systems, Inc.
16) DEEDS OF TRUST - These investments are in first deeds of
trust. All deeds of trust are held in conjunction with related
parties (Note 4). Effective January 1, 1995, this investment
option is no longer open to participant contributions;
however, all income earned on this investment will continue to
be reinvested in the fund.
b. Contributions - Employer contributions are accrued annually
based upon the amount approved by the Board of Directors of
the Company.
F-7
<PAGE> 13
c. Income and Expenses - Investment income includes interest and
dividend income earned on the deeds of trust, investment funds, cash
accounts, and participant loans. The Company provides legal,
accounting, office space and clerical services to the Plan without
charge.
d. Payment of Benefits - Benefits are recorded when paid.
e. Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles necessarily
requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial
statements and the reported amounts of additions and deductions
during the reporting period. Actual results could differ from those
estimates.
3. FUND INFORMATION
Investment income, contributions, transfer of assets from 3M plans and
benefits paid to participants by fund for the years ended December 31 are as
follows:
<TABLE>
<CAPTION>
1998 1997
----------- -----------
<S> <C> <C>
Investment income:
The Dreyfus A Bonds Plus Fund $ 5,601 $ 35,023
The Fidelity Advisor Growth Opportunities Fund 360,153 220,321
The Fidelity Advisor High Yield A Fund (19,576) 73,939
The Fidelity Asset Manager Fund 1,996 66,866
Federated Bond Fund 9
Nationwide Fund 1,315
Neuberger & Berman Partners Trust Fund 46,307 150,936
The Twentieth Century Ultra Investors Fund 536,603 162,733
The Templeton Foreign Fund (105,727) 41,821
The Fixed Account Fund 28,786 21,717
The Warburg Pincus Emerging Growth Fund 54,642 181,867
The Neuberger & Berman Guardian Trust Fund (8,259) 93,461
The Nationwide Money Market Fund 12,519 9,900
Personal Portfolio 36
The Outdoor Systems Common Stock Fund 199,171 64,380
Deeds of trust 84,203 75,223
Participant loans 49,886 27,153
----------- -----------
Total investment income $ 1,247,665 $ 1,225,340
=========== ===========
</TABLE>
F-8
<PAGE> 14
<TABLE>
<CAPTION>
1998 1997
---------- ----------
<S> <C> <C>
Contributions:
The Dreyfus A Bonds Plus Fund $ 159,369 $ 150,571
The Fidelity Advisor Growth Opportunities Fund 645,775 289,614
The Fidelity Advisor High Yield A Fund 205,830 165,015
The Fidelity Asset Manager Fund 6,280 2,398
Federated Bond Fund 8,083
Nationwide Fund 53,522
The Neuberger & Berman Partners Trust Fund 416,673 210,008
The Twentieth Century Ultra Investors Fund 486,677 332,891
The Templeton Foreign Fund 357,192 369,747
The Fixed Account Fund 208,933 127,302
The Warburg Pincus Emerging Growth Fund 354,409 348,988
The Neuberger & Berman Guardian Trust Fund 342,926 277,704
The Nationwide Money Market Fund 12,256 4,276
Personal Portfolio 3,770
The Outdoor Systems Common Stock Fund 200,631 139,201
Participant loans 101,622
---------- ----------
Total contributions $3,563,948 $2,417,715
========== ==========
</TABLE>
Transfer of assets from 3M plans for the year ended December 31, 1997 were
as follows:
<TABLE>
<CAPTION>
<S> <C>
The Dreyfus A Bonds Plus Fund $ 20,864
The Fidelity Advisor Growth Opportunities Fund 87,468
The Fidelity Advisor High Yield A Fund 6,174
The Fidelity Asset Manager Fund 86,238
The Neuberger & Berman Partners Trust Fund 106,635
The Twentieth Century Ultra Investors Fund 112,041
The Templeton Foreign Fund 46,421
The Fixed Account Fund 162,389
The Warburg Pincus Emerging Growth Fund (3,121)
The Neuberger & Berman Guardian Trust Fund 72,820
The Nationwide Money Market Fund 595,033
Participant loans 113,118
-----------
Total transfer of assets $ 1,406,080
===========
</TABLE>
F-9
<PAGE> 15
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
Benefits paid to participants:
The Dreyfus A Bonds Plus Fund $ 73,010 $ 38,438
The Fidelity Advisor Growth Opportunities Fund 112,854 73,691
The Fidelity Advisor High Yield A Fund 75,015 35,486
The Neuberger & Berman Partners Trust Fund 93,707 43,024
The Twentieth Century Ultra Investors Fund 180,258 92,620
The Templeton Foreign Fund 140,010 71,594
The Fixed Account Fund 121,183 14,891
The Warburg Pincus Emerging Growth Fund 100,431 93,851
The Neuberger & Berman Guardian Trust Fund 123,653 48,259
The Nationwide Money Market Fund 9,463 127,172
The Outdoor Systems Common Stock Fund 15,799 1,192
Participant loans 26,871 26,400
---------- ----------
Total benefits paid to participants $1,072,254 $ 666,618
========== ==========
</TABLE>
4. INVESTMENTS
The Plan's investments in individual deeds of trust represent a percentage
of the entire applicable deed of trust, the remainder of which is held by
related plans with a common trustee. These investments are collateralized
by real property, the majority of which is located in Maricopa County,
Arizona. There is no unrealized appreciation/depreciation on deeds of
trust as management believes the cost of the investments represents a
reasonable estimate of their fair market values.
F-10
<PAGE> 16
The following table presents the fair value of investments at December 31:
<TABLE>
<CAPTION>
1998 1997
<S> <C> <C>
Investments at estimated fair value:
Deeds of trust $ 794,205 $ 736,874
Participant loans 661,945 510,401
----------- -----------
Total investments at estimated fair value 1,456,150 1,247,275
----------- -----------
Investments at fair value as determined by quoted market price:
The Dreyfus A Bonds Plus Fund $ 608,094 $ 513,884
The Fidelity Advisor Growth Opportunities Fund 2,209,953 1,332,387
The Fidelity Advisor High Yield A Fund 825,462 716,089
The Fidelity Asset Manager Fund 18,529 10,554
Federated Bond Fund 7,934
Nationwide Fund 54,266
The Neuberger & Berman Partners Trust Fund 1,345,026 989,571
The Twentieth Century Ultra Investors Fund 2,547,571 1,405,069
The Templeton Foreign Fund 1,574,916 1,464,238
The Fixed Account Fund 695,171 574,453
The Warburg Pincus Emerging Growth Fund 1,673,302 1,367,693
The Neuberger & Berman Guardian Trust Fund 1,304,948 1,103,125
The Nationwide Money Market Fund 436,368 736,297
Personal portfolio 3,786
The Outdoor Systems Common Stock Fund 553,778 178,817
----------- -----------
Total investments at fair value as determined by
quoted market price 13,859,104 10,392,177
----------- -----------
Total investments $15,315,254 $11,639,452
=========== ===========
</TABLE>
5. TAX STATUS OF THE PLAN
The Internal Revenue Service ("IRS") has determined and informed the
Employer by letter dated January 8, 1998 that the Plan and related trust
meet the requirements of Section 401(k) of the Internal Revenue Code
("IRC") and are exempt from federal income taxes under Section 501(a) of
the IRC. The Plan has been amended since receiving the determination
letter and the Plan Administrator believes that the Plan is designed and
is currently being operated in compliance with the applicable requirements
of the IRC.
6. RELATED PARTY TRANSACTIONS
Certain Plan investments are shares of funds managed by Nationwide
Insurance. Nationwide Insurance is a Custodian as defined by the Plan and,
therefore, these transactions qualify as party-in-interest transactions.
Other Plan investments are held in deeds of trust which are held in
conjunction with related plans with a common trustee. Certain Plan assets
are invested in the stock of Outdoor Systems, Inc. Outdoor Systems, Inc.
is the Plan Sponsor. These transactions also qualify as party-in-interest
transactions to the Plan. The transactions are permitted under the
instruments under which the Plan is maintained.
F-11
<PAGE> 17
7. SUBSEQUENT EVENTS
On May 27, 1999, the Plan sponsor, Outdoor Systems, Inc. ("OSI"), entered
into an Agreement and Plan of Merger (the "Merger Agreement") with Infinity
Broadcasting Corporation ("Infinity") and Burma Acquisition Corp., a
wholly-owned subsidiary of Infinity ("Subsidiary"). The Merger Agreement
provides for the acquisition of OSI by Infinity pursuant to the merger (the
"Merger") of Subsidiary with and into OSI, with OSI surviving the Merger and
becoming a wholly-owned subsidiary of Infinity. Completion of the Merger is
subject to certain closing conditions, including the expiration or early
termination of the Hart-Scott-Rodino waiting period and the approval and
adoption of the Merger Agreement and the Merger by OSI stockholders. Completion
of the Merger is expected to occur in the fall of 1999. It is anticipated that
the Plan will remain intact through 1999 and will be merged into a qualified
plan of Infinity during 2000.
* * * * * *
F-12
<PAGE> 18
OUTDOOR SYSTEMS, INC.
401(k) PLAN
SUPPLEMENTAL SCHEDULE
DECEMBER 31, 1998
- --------------------------------------------------------------------------------
Item 27a - Assets Held for Investment Purposes
<TABLE>
<CAPTION>
COLUMN B COLUMN C COLUMN D COLUMN E
- ----------------------- ----------------------------------------------------- -------------- --------------
IDENTITY OF ISSUER, DESCRIPTION OF INVESTMENT INCLUDING
BORROWER, LESSOR MATURITY DATE, RATE OF INTEREST, CURRENT
OR SIMILAR PARTY COLLATERAL, PAR OR MATURITY VALUE COST VALUE
- ----------------------- ----------------------------------------------------- -------------- --------------
<S> <C> <C> <C>
Atlantic & Pacific Deed of Trust - dated July 28, 1997,
10.3% interest payable monthly, due July 31, 1999,
collateralized by real property $ 100,000 $ 100,000
Arcadia Deed of Trust - dated August 22, 1997, 14.5%
interest payable monthly, due July 22, 2000,
collateralized by real property 87,745 87,745
AZ Sun Holding Deed of Trust - dated May 29, 1998,
12% interest payable monthly, due November 26,
1999, collateralized by real property 45,000 45,000
Barron Deed of Trust - dated August 28, 1996, 12%
interest, payable monthly, due August 28, 2006,
collateralized by real property 14,265 14,265
Broadland Properties Deed of Trust - dated October 28, 1998,
10.5% interest, payable monthly, due October 28,
2000, collateralized by real property 48,016 48,016
Crescent Moon Deed of Trust - dated August 4, 1998, 11.5%
interest, payable monthly, due August 4, 2000,
collateralized by real property 36,000 36,000
Czerwinski Deed of Trust - dated June 19, 1998, 12.5%
interest, payable monthly, due July 1, 2000,
collateralized by real property 6,600 6,600
Davidson Deed of Trust - dated June 1, 1995, 12% interest,
payable monthly, due June 1, 1999, collateralized
by real property 25,000 25,000
Diogenes Deed of Trust - dated January 8, 1998, 10%
interest, payable monthly, due January 7, 1999,
collateralized by real property 8,600 8,600
Flag #66 Deed of Trust - dated September 2, 1998, 12%
interest, payable monthly, due August 1, 2000,
collateralized by real property 21,300 21,300
Gates Deed of Trust - dated September 23, 1998, 12.5%
interest, payable monthly, due September 23, 2003,
collateralized by real property 49,218 49,218
Huntington Deed of Trust - dated March 5, 1998, 14% interest,
payable monthly, due April 1, 1999, collateralized
by real property 40,000 40,000
</TABLE>
(Continued)
F-13
<PAGE> 19
OUTDOOR SYSTEMS, INC.
401(k) PLAN
SUPPLEMENTAL SCHEDULE
DECEMBER 31, 1998
- --------------------------------------------------------------------------------
ITEM 27a - ASSETS HELD FOR INVESTMENT PURPOSES
<TABLE>
<CAPTION>
COLUMN B COLUMN C COLUMN D COLUMN E
- ----------------------- ----------------------------------------------------- -------------- --------------
IDENTITY OF ISSUER, DESCRIPTION OF INVESTMENT INCLUDING
BORROWER, LESSOR MATURITY DATE, RATE OF INTEREST, CURRENT
OR SIMILAR PARTY COLLATERAL, PAR OR MATURITY VALUE COST VALUE
- ----------------------- ----------------------------------------------------- -------------- --------------
<S> <C> <C> <C>
MVI Development Deed of Trust - dated March 19, 1998,
11% interest payable monthly, due December 25,
1999, collateralized by real property 29,392 29,392
MVI Development III Deed of Trust - dated November 24,
1998, 11% interest payable monthly, due November
25, 2000, collateralized by real property 5,400 5,400
Pollock Deed of Trust - dated February 5, 1998, 11.5%
interest payable monthly, due February 15, 2005,
collateralized by real property 14,718 14,718
SEC Baseline Deed of Trust - dated December 19, 1996,
12% interest, payable monthly, due December 13,
1998, collateralized by real property 50,000 50,000
Shoemake Deed of Trust - dated June 24, 1998, 11% interest,
payable monthly, due June 15, 2000, collateralized
by real property 6,500 6,500
Superstition Shadows Deed of Trust - dated October 3, 1997,
10.8% interest, payable monthly, due August 29,
2000, collateralized by real property 131,641 131,641
Tri-Trust Deed of Trust - dated September 3, 1998, 11.25%
interest, payable monthly, due August 25, 2000,
collateralized by real property 70,900 70,900
Cash Norwest Bank Money Market Account, variable
interest rate 3,910 3,910
-------- ----------
Total deeds of trust 794,205 794,205
-------- ----------
Participant Loans Participant notes - 7.25%-10.5% interest, maturing
January 1997 through September 2012 661,945 661,945
-------- ----------
The Dreyfus A
Bonds Plus Fund Mutual Fund - 543,705 units * 608,094
The Fidelity Advisor
Growth Opportunities
Fund Mutual Fund - 1,149,938 units * 2,209,953
The Fidelity Advisor
High Yield A Fund Mutual Fund - 719,541 units * 825,462
</TABLE>
* The historical cost is not readily available. (Continued)
F-14
<PAGE> 20
OUTDOOR SYSTEMS, INC.
401(k) PLAN
SUPPLEMENTAL SCHEDULE
DECEMBER 31, 1998
- --------------------------------------------------------------------------------
ITEM 27a - ASSETS HELD FOR INVESTMENT PURPOSES
<TABLE>
<CAPTION>
COLUMN B COLUMN C COLUMN D COLUMN E
- ----------------------- ----------------------------------------------------- -------------- --------------
IDENTITY OF ISSUER, DESCRIPTION OF INVESTMENT INCLUDING
BORROWER, LESSOR MATURITY DATE, RATE OF INTEREST, CURRENT
OR SIMILAR PARTY COLLATERAL, PAR OR MATURITY VALUE COST VALUE
- ----------------------- ----------------------------------------------------- -------------- --------------
<S> <C> <C> <C>
The Fidelity Asset
Manager Fund Mutual Fund - 12,971 units * 18,529
The Federated Bond
Fund Mutual Fund - 7,842 units 7,934
The Nationwide Fund Mutual Fund - 50,028 units 54,266
The Neuberger &
Berman Partners
Trust Fund Mutual Fund - 925,151 units * 1,345,026
The Twentieth
Century Ultra
Investors Fund Mutual Fund - 1,575,240 units * 2,547,571
The Templeton
Foreign Fund Mutual Fund - 1,213,495 units * 1,574,916
The Fixed Account
Fund Mutual Fund - 636,459 units * 695,171
The Warburg Pincus
Emerging Growth Fund Mutual Fund - 1,338,622 units * 1,673,302
The Neuberger &
Berman Guardian
Trust Fund Mutual Fund - 1,038,434 units * 1,304,948
The Nationwide
Money Market Fund Money Market Fund - 222,267 units * 436,368
Personal Portfolio Mutual Fund - 3,793 units 3,786
The Outdoor Systems
Common Stock Fund Common Stock - 18,021 shares * 553,778
------------
Total other investments 13,859,104
------------
Total assets held for investment purposes $ 15,315,254
============
</TABLE>
* The historical cost is not readily available. (Concluded)
F-15
<PAGE> 21
OUTDOOR SYSTEMS, INC.
401(k) PLAN
SUPPLEMENTAL SCHEDULE
YEAR ENDED DECEMBER 31, 1998
- --------------------------------------------------------------------------------
ITEM 27d - REPORTABLE TRANSACTIONS
<TABLE>
<CAPTION>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN G COLUMN H COLUMN I
- --------------------------- ---------------------------- ------------ ------------ ------------ --------------- ----------
CURRENT
IDENTITY VALUE OF NET
OF DESCRIPTION COST ASSET ON GAIN
PARTY OF PURCHASE SELLING OF TRANSACTION OR
INVOLVED ASSET PRICE PRICE ASSET DATE (LOSS)
- --------------------------- ---------------------------- ------------ ------------ ------------ --------------- ----------
<S> <C> <C> <C> <C> <C> <C>
SINGLE TRANSACTIONS
None
SERIES OF TRANSACTIONS
Nationwide Insurance The Fidelity Advisor
Growth Opportunities Fund $630,456 $630,456 $630,456
The Fidelity Advisor
Growth Opportunities Fund 112,812 * 112,812
Nationwide Insurance The Neuberger & Berman
Guardian Trust Fund 411,576 411,576 411,576
Nationwide Insurance The Neuberger & Berman
Guardian Trust Fund 201,412 * 201,412
Nationwide Insurance The Templeton
Foreign Fund 459,666 459,666 459,666
The Templeton
Foreign Fund 243,125 * 243,125
Nationwide Insurance The Twentieth Century
Ultra Investors Fund 786,246 786,246 786,246
The Twentieth Century
Ultra Investors Fund 180,251 * 180,251
Nationwide Insurance The Warburg Pincus
Emerging Growth Fund 438,980 438,980 438,980
The Warburg Pincus
Emerging Growth Fund 187,955 * 187,955
</TABLE>
* The historical cost is not readily available.
NOTE: Reportable transactions are those transactions which either singularly
or in series of combined purchases and sales during the year exceed
5% of the fair value of the Plan's assets at the beginning of the
year.
F-16
<PAGE> 22
Exhibit Index
Exhibit 23 - Consent of Independent Auditors
<PAGE> 1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
333-38591 of Outdoor Systems, Inc. on Form S-8 of our report dated May 30, 1999
appearing in this Annual Report on Form 11-K of the Outdoor Systems, Inc.
401(k) Plan for the year ended December 31, 1998.
Phoenix, Arizona
June 29, 1999
