<PAGE>
EXHIBIT 99.1
INSTRUCTIONS AS TO USE OF TEJON RANCH CO.
SUBSCRIPTION WARRANTS
----------------
CONSULT CHASEMELLON SHAREHOLDER SERVICES, L.L.C., YOUR BANK OR BROKER
AS TO ANY QUESTIONS
The following instructions relate to a rights offering (the "Rights
Offering") by Tejon Ranch Co., a Delaware corporation (the "Company"), to the
holders of its Common Stock, par value $.50 per share (the "Common Stock"), as
described in the Company's Prospectus dated December, 2000 (the "Prospectus").
Holders of record of shares of the Common Stock at the close of business on
January , 2001 (the "Record Date") are receiving one transferable subscription
right (collectively, the "Rights") for each share of the Common Stock held by
them on the Record Date. An aggregate of approximately Rights exercisable
to purchase an aggregate of approximately shares of the Common Stock are
being distributed in connection with the Rights Offering. Each whole Right is
exercisable, upon payment of $ in cash (the "Subscription Price"), to
purchase share of the Common Stock (the "Basic Subscription Privilege"). In
addition, subject to the proration described below, each holder of Rights who
fully exercises the Basic Subscription Privilege also has the right to
subscribe at the Subscription Price for additional Common Stock (the
"Oversubscription Privilege"). The shares of the Common Stock will be available
for purchase pursuant to the Oversubscription Privilege only to the extent that
all the shares are not subscribed for through the exercise of the Basic
Subscription Privilege by the Expiration Date. If the shares of the Common
Stock so available (the "Over-Subscription Shares") are not sufficient to
satisfy all subscriptions pursuant to the Oversubscription Privilege, the
available shares will be allocated pro rata among holders of the Rights
exercising the Oversubscription Privilege, in proportion to the number of
shares each such holder has subscribed to purchase pursuant to his or her
respective Basic Subscription Privilege; provided, however, that if such pro
rata allocation results in any holder being allocated a greater number of Over-
Subscription Shares than such holder subscribed for pursuant to the exercise of
such holder's Oversubscription Privilege, then such holder will be allocated
only such number of Over-Subscription Shares as such holder subscribed for and
the remaining Over-Subscription Shares will be allocated among all other
holders exercising Oversubscription Privileges. See discussion set forth under
"Rights Offering" in the Prospectus.
No fractional Rights or cash in lieu thereof will be issued or paid. The
number of Rights distributed by the Company has been rounded up to the nearest
whole number in order to avoid issuing fractional Rights.
The Rights will expire at 5:00 p.m., New York City time, on January , 2001,
unless extended (the "Expiration Date").
The number of Rights to which you are entitled is printed on the face of
your subscription warrants. You should indicate your wishes with regard to the
exercise or sale of your Rights by completing the appropriate form or forms on
your subscription warrant and returning the certificate to the Subscription
Agent in the envelope provided.
YOUR SUBSCRIPTION CERTIFICATE MUST BE RECEIVED BY THE SUBSCRIPTION AGENT, OR
GUARANTEED DELIVERY REQUIREMENTS WITH RESPECT TO YOUR SUBSCRIPTION WARRANTS
MUST BE COMPLIED WITH, AND PAYMENT OF THE SUBSCRIPTION PRICE, INCLUDING FINAL
CLEARANCE OF ANY CHECKS, MUST BE RECEIVED BY THE SUBSCRIPTION AGENT, ON OR
BEFORE 5:00 P.M., NEW YORK CITY TIME, ON THE EXPIRATION DATE. YOU MAY NOT
REVOKE ANY EXERCISE OF A RIGHT.
<PAGE>
1. Subscription Privilege.
To exercise Rights, complete Form 1 and send your properly completed and
executed subscription warrant, together with payments in full of the
Subscription Price for each share of the Common Stock subscribed for pursuant
to the Basic Subscription Privilege and the Oversubscription Privilege, to the
Subscription Agent. Payment of the Subscription Price must be made in U.S.
dollars for the full number of shares of the Common Stock being subscribed for
by (a) check or bank draft drawn upon a U.S. bank or postal, telegraphic or
express money order payable to ChaseMellon Shareholder Services, L.L.C., acting
on behalf of the Subscription Agent, or (b) wire transfer of same day funds to
the account maintained by the Subscription Agent for such purpose at The Chase
Manhattan Bank, New York, NY, ABA No. 021 000 021, Attention: ChaseMellon
Shareholder Services Reorg. Account: 323-885489 (Tejon Ranch Co.). The
Subscription Price will be deemed to have been received by the Subscription
Agent only upon (i) the clearance of any uncertified check, (ii) the receipt by
the Subscription Agent of any certified check or bank draft drawn upon a U.S.
bank or any postal, telegraphic or express money order or (iii) the receipt of
good funds in the Subscription Agent's account designated above. If paying by
uncertified personal check, please note that the funds paid thereby may take at
least three business days to clear. Accordingly, holders of the Rights who wish
to pay the Subscription Price by means of uncertified personal check are urged
to make payment sufficiently in advance of the Expiration Date to ensure that
such payment is received and clears by such date and are urged to consider
payment by means of certified or cashier's check, money order or wire transfer
of funds. You may also transfer your subscription warrant to your bank or
broker in accordance with the procedures specified in Section 3(a) below, make
arrangements for the delivery of funds on your behalf and request such bank or
broker to exercise the subscription warrant on your behalf. Alternatively, you
may cause a written guarantee substantially in the form of Exhibit A to these
instructions (the "Notice of Guaranteed Delivery") from a commercial bank,
trust company, securities broker or dealer, credit union, savings association
or other eligible guarantor institution which is a member of or a participant
in a signature guarantee program acceptable to the Subscription Agent (each of
the foregoing being an "Eligible Institution"), to be received by the
Subscription Agent at or prior to the Expiration Date together with payment in
full of the applicable Subscription Price. Such Notice of Guaranteed Delivery
must state your name, the number of Rights represented by your subscription
warrant and the number of Rights being exercised pursuant to the Basic
Subscription Privilege and the number of shares of the Common Stock, if any,
being subscribed for pursuant to the Oversubscription Privilege, and will
guarantee the delivery to the Subscription Agent of your properly completed and
executed subscription warrants within three New York Stock Exchange trading
days following the date of the Notice of Guaranteed Delivery. If this procedure
is followed, your subscription warrant must be received by the Subscription
Agent within three New York Stock Exchange trading days of the Notice of
Guaranteed Delivery. Additional copies of the Notice of Guaranteed Delivery may
be obtained upon request from ChaseMellon Shareholder Services, L.L.C., at the
address, or by calling the telephone number, indicated below.
Banks, brokers or other nominee holders of the Rights who exercise the
Rights and the Oversubscription Privilege on behalf of beneficial owners of
Rights will be required to certify to the Subscription Agent and the Company,
in connection with the exercise of the Oversubscription Privilege, as to the
aggregate number of Rights that have been exercised, and the number of shares
that are being subscribed for pursuant to the Oversubscription Privilege, by
each beneficial owner of Rights on whose behalf such nominee holder is acting.
If more shares of the Common Stock are subscribed for pursuant to the
Oversubscription Privilege than are available for sale, such shares will be
allocated, as described above, among persons exercising the Oversubscription
Privilege in proportion to the number of shares such persons seek to purchase
pursuant to the Basic Subscription Privilege.
<PAGE>
The address and telecopier numbers of the Subscription Agent are as follows:
<TABLE>
<S> <C> <C>
Facsimile Transmission
By Mail: (eligible By Hand:
institutions only):
ChaseMellon Shareholder Services, ChaseMellon Shareholder Services,
L.L.C. L.L.C.
Post Office Box 3301 (201) 296-4293 120 Broadway, 13th Floor
Hackensack, NJ 07606 New York, NY 10271
Attn: Reorganization Department Attn: Reorganization Department
</TABLE>
To confirm receipt of facsimile only:
(201) 496-4860
If by Overnight Courier:
ChaseMellon Shareholder Services, L.L.C.
85 Challenger Road--Mail Drop--Reorg
Ridgefield Park, NJ 07660
Attn: Reorganization Department
The address and telephone numbers of ChaseMellon Shareholder Services,
L.L.C., for inquiries, information or requests for additional documentation is
as follows:
44 Wall Street, 7th Floor
New York, NY 10005
CALL TOLL-FREE
(866) 293-6625
If you exercise less than all of the Rights evidenced by your subscription
warrant by so indicating in Form 1 of your subscription warrant, the
Subscription Agent will issue to you a new subscription warrant evidencing the
unexercised Rights. However, if you choose to have a new subscription warrant
sent to you, you may not receive any such new subscription warrant in
sufficient time to permit you to sell or exercise the Rights evidenced thereby.
If you have not indicated the number of Rights being exercised, or if you have
not forwarded full payment of the Subscription Price for the number of Rights
that you have indicated are being exercised, you will be deemed to have
exercised the Basic Subscription Privilege with respect to the maximum number
of whole shares of Common Stock which may be exercised for the Subscription
Price payment delivered by you and to the extent that the Subscription Price
payment delivered by you exceeds the product of the Subscription Price
multiplied by the number of shares per Right and multiplied by the number of
Rights evidenced by the subscription warrants delivered by you (such excess
being the "Subscription Excess"), you will be deemed to have exercised your
Oversubscription Privilege to purchase, to the extent available, that number of
whole shares of the Common Stock equal to the quotient obtained by dividing the
Subscription Excess by the Subscription Price.
2. Delivery of Common Stock.
The following deliveries and payments will be made to the address shown on
the face of your subscription warrant unless you provide instructions to the
contrary on Form 3.
(a) Basic Subscription Privilege. As soon as practicable after the valid
exercise of the Rights, the Subscription Agent will mail to each exercising
Rights holder certificates representing shares of the Common Stock purchased
pursuant to the Basic Subscription Privilege.
(b) Oversubscription Privilege. As soon as practicable after the Expiration
Date, the Subscription Agent will mail to each Rights holder who validly
exercises the Oversubscription Privilege the number of shares of the Common
Stock allocated to such Rights holder pursuant to the Oversubscription
Privilege. See "Rights Offering--Over-Subscription Rights" in the Prospectus.
<PAGE>
(c) Cash Payments. As soon as practicable after the Expiration Date, the
Subscription Agent will mail to each Rights holder who exercises the
Oversubscription Privilege any excess funds, without interest, received in
payment of the Exercise Price for each share of the Common Stock that is
subscribed for by such Rights holder but not allocated to such Rights holder
pursuant to the Oversubscription Privilege.
3. To Sell or Transfer Rights.
(a) Sale of Rights through a Bank or Broker. To sell all the Rights
evidenced by a subscription warrant through your bank or broker, so indicate on
Form 2 and deliver your properly completed and executed subscription warrant to
your bank or broker. Your subscription warrant should be delivered to your bank
or broker in ample time for it to be exercised. If Form 2 is completed without
designating a transferee, the Subscription Agent may thereafter treat the
bearer of the subscription warrant as the absolute owner of all of the Rights
evidenced by such subscription warrant for all purposes, and the Subscription
Agent shall not be affected by any notice to the contrary. Because your bank or
broker cannot issue subscription warrants, if you wish to sell less than all of
the Rights evidenced by a subscription warrant, either you or your bank or
broker must instruct the Subscription Agent as to the action to be taken with
respect to the Rights not sold, or you or your bank or broker must first have
your subscription warrant divided into subscription warrants of appropriate
denominations by following the instructions in paragraph 4 of these
instructions. The subscription warrants evidencing the number of Rights you
intend to sell can then be transferred by your bank or broker in accordance
with the instructions in this paragraph 3(a).
(b) Transfer of Rights to a Designated Transferee. To transfer all of your
Rights to a transferee other than a bank or broker, you must complete Form 2 in
its entirety, execute the subscription warrant and have your signature
guaranteed by an Eligible Institution. A subscription warrant that has been
properly transferred in its entirety may be exercised by a new holder without
having a new subscription warrant issued. Because only the Subscription Agent
can issue subscription warrants, if you wish to transfer less than all of the
Rights evidenced by your subscription warrant to a designated transferee, you
must instruct the Subscription Agent as to the action to be taken with respect
to the Rights not sold or transferred, or you must divide your subscription
warrant into subscription warrants of appropriate smaller denominations by
following the instructions in paragraph 4 below. The subscription warrant
evidencing the number of Rights you intend to transfer can then be transferred
by following the instructions in this paragraph 3(b).
(c) Sale of Rights Through the Subscription Agent. To sell all Rights
evidenced by a subscription warrant through the Subscription Agent, so indicate
on Form 3 and deliver your properly completed and exercised subscription
warrant to the Subscription Agent. If you wish to sell less than all of the
Rights evidenced by a subscription warrant, you must instruct the Subscription
Agent as to the action to be taken with respect to the Rights not sold, or you
may have your subscription warrant divided into subscription warrant's of
appropriate denominations by following the instructions in paragraph 4 of those
instructions. The subscription warrant evidencing the number of Rights you
intend to transfer can then be transferred by following the instructions in
this paragraph 3(c). Promptly following the Expiration Date, the Subscription
Agent will send the holder a check for the net proceeds from the sale of any
rights sold. No assurance can be given that a market will develop for the
Rights or that the Subscription Agent will be able to sell any Rights.
4. To Have a Subscription Warrant Divided into Smaller Denominations.
Send your subscription warrant, together with complete separate instructions
(including specification of the denominations into which you wish your Rights
to be divided) signed by you, to the Subscription Agent, at least five business
days prior to the Expiration Date, in order to allow a sufficient amount of
time for new subscription warrants to be issued and returned so that they can
be used prior to the Expiration Date. Alternatively, you may ask a bank or
broker to effect such actions on your behalf. Your signature must be guaranteed
by an Eligible Institution if any of the new subscription warrants are to be
issued in a name other than that in which the old subscription warrant was
issued. Subscription certificates may not be divided into fractional Rights,
and any instruction to do so will be rejected. As a result of delays in the
mail, the time of the
<PAGE>
transmittal, the necessary processing time and other factors, you or your
transferee may not receive such new subscription warrants in time to enable the
Rights holder to complete a sale or exercise by the Expiration Date. Neither
the Company nor the Subscription Agent will be liable to either a transferor or
transferee for any such delays.
5. Execution.
(a) Execution by Registered Holder. The signature on the subscription
warrant must correspond with the name of the registered holder exactly as it
appears on the face of the subscription warrant without any alteration or
change whatsoever. Persons who sign the subscription warrant in a
representative or other fiduciary capacity must indicate their capacity when
signing and, unless waived by the Subscription Agent in its sole and absolute
discretion, must present to the Subscription Agent satisfactory evidence of
their authority to so act.
(b) Execution by Person Other than Registered Holder. If the subscription
warrant is executed by a person other than the holder named on the face of the
subscription warrant, proper evidence of authority of the person executing the
subscription warrant must accompany the same unless, for good cause, the
Subscription Agent dispenses with proof of authority.
(c) Signature Guarantees. Your signature must be guaranteed by an Eligible
Institution if you wish to transfer your Rights, as specified in 3(b) above, to
a transferee other than a bank or broker or the Subscription Agent, or if you
specify special payment or delivery instructions pursuant to Form 4.
6. Method of Delivery.
The method of delivery of subscription warrants and payment of the Exercise
Price to the Subscription Agent will be at the election and risk of the Rights
holder, but, if sent by mail, it is recommended that they be sent by registered
mail, properly insured, with return receipt requested, and that a sufficient
number of days be allowed to ensure delivery to the Subscription Agent and the
clearance of any checks sent in payment of the Exercise Price prior to 5:00
p.m., New York City time, on the Expiration Date.
7. Special Provisions Relating to the Delivery of Rights Through The Depository
Trust Company.
In the case of holders of Rights that are held of record through The
Depository Trust Company ("DTC"), exercises of the Basic Subscription Privilege
(but not the Oversubscription Privilege) may be effected by instructing DTC to
transfer Rights (such Rights being "DTC Exercised Rights") from the DTC account
of such holder to the DTC account of the Subscription Agent, together with
payment of the Subscription Price for each share of Common Stock subscribed for
pursuant to the Basic Subscription Privilege. The Oversubscription Privilege in
respect of DTC Exercised Rights may not be exercised through DTC. The holder of
a DTC Exercised Right may exercise the Oversubscription Privilege in respect of
such DTC Exercised Right by properly executing and delivering to the
Subscription Agent at or prior to 5:00 p.m., New York City time on the
Expiration Date, a DTC Participant Oversubscription Exercise Form, in the form
available from the Subscription Agent, together with payment of the appropriate
Subscription Price for the number of shares of Common Stock for which the
Oversubscription Privilege is to be exercised.
If a Notice of Guaranteed Delivery relates to Rights with respect to which
exercise of the Basic Subscription Privilege will be made through DTC and such
Notice of Guaranteed Delivery also relates to the exercise of the
Oversubscription Privilege, a DTC Participant Oversubscription Exercise Form
must also be received by the Subscription Agent in respect of such exercise of
the Oversubscription Privilege on or prior to the Expiration Date.
<PAGE>
8. Substitute Form W-9.
Each Rights holder who elects to exercise the Rights and those foreign
stockholders who allow the Subscription Agent to sell such foreign holder's
Rights should provide the Subscription Agent with a correct Taxpayer
Identification Number ("TIN") on Substitute Form W-9, which is included as
Exhibit B hereto. Additional copies of Substitute Form W-9 may be obtained upon
request from the Subscription Agent at the address, or by calling the telephone
number, indicated above. Failure to provide the information on the form may
subject such holder to 31% federal income tax withholding with respect to (i)
dividends that may be paid by the Company on shares of Common Stock purchased
upon the exercise of Rights (for those holders exercising Rights), or (ii)
funds to be remitted to Rights holders in respect of Rights sold by the
Subscription Agent (for those holders electing to have the Subscription Agent
sell their Rights).
<PAGE>
PAYOR: Firstar Bank, N.A.
Part I--Taxpayer
Identification Number (TIN)
(A) Enter your TIN in the Enter your TIN below:
box at right and certify by
signing and dating as
provided in Part III below.
See Instructions. ----------------------
(B) Please check the box at
SUBSTITUTE right if you have applied [_]
FORM W-9 for, and are awaiting
receipt of, your TIN.
Department of --------------------------------------------------------
the Treasury
Internal Revenue Name ____________________________________________
Service
--------------------------------------------------------
(if a joint account or you changed your name, see
Instructions)
Business name ___________________________________
(if different from above, see Instructions)
Check appropriate box: [_] Individual/Sole
proprietor [_] Corporation
Payor's Request [_] Partnership [_] Other
for Taxpayer Address _________________________________________
Identification (number, street and apt. or suite no.)
Number _________________________________________________
and Certification (City, State and ZIP code)
--------------------------------------------------------
Give form
to the payor.
Do NOT send Part II--For Payees exempt from backup withholding,
to the IRS. please write "Exempt" below. (See instructions)
--------------------------------------------------------
Part III--Certification--Under penalties of perjury,
I certify that:
1. The number shown on this form is my correct TIN (or I
am waiting for a number to be issued to me) and
2. I am not subject to backup withholding because:
(a) I am exempt from backup withholding, or (b) I have not
been notified by the Internal Revenue Service (IRS) that I
am subject to backup withholding as a result of a failure
to report all interest or dividends, or (c) the IRS has
notified me that I am no longer subject to backup
withholding.
Certification instructions. You must cross out Item 2
above if you have been notified by the IRS that you are
currently subject to backup withholding because you have
failed to report all interest and dividends on your tax
return. However, if after being notified by the IRS that
you were subject to backup withholding you received
another notification from the IRS that you are no longer
subject to backup withholding, do not cross out such Item
2.
--------------------------------------------------------
Sign Here
Signature _________________ Date _________________
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 1(B)
OF THE SUBSTITUTE FORM W-9 INDICATING YOU HAVE APPLIED FOR, AND ARE AWAITING
RECEIPT OF, YOUR TIN.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a TIN has not been issued to me,
and either (1) I have mailed or delivered an application to receive a TIN
to the appropriate Internal Revenue Service Center or Social Security
Administration Office or (2) I intend to mail or deliver an application in
the near future. I understand that if I do not provide a TIN to the Payor
by the time of payment, 31% of all reportable payments made to me pursuant
to the Offer and the Consent Solicitation will be withheld.
SIGNATURE ___________________________________________ DATE _________________
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE PAYOR.
Social security numbers have nine digits separated by two hyphens, e.g.,
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen, e.g., 00-0000000. The table below will help determine the number to
give the payor.
<TABLE>
------------------------------------------------------------- -----------------------------------------------------------------
Give the name* and Give the name and
For this type of account: SOCIAL SECURITY For this type of account: EMPLOYER
number of-- IDENTIFICATION
number of--
------------------------------------------------------------- -----------------------------------------------------------------
<S> <C> <C> <C>
1. Individual The individual 6. A valid trust, estate, or pension Legal entity(4)
trust
2. Two or more individuals The actual owner of the 7. Corporate The corporation
(joint account) account or, if combined
funds, the first individual 8. Association, club, religious, The organization
on the account(1) charitable, or other tax-exempt
organization
3. Custodian account of a The minor(2)
minor (Uniform Gift to 9. Partnership The partnership
Minors Act)
10. A broker or registered nominee The broker or nominee
4. a. The usual revocable The grantor-trustee(1)
savings trust account 11. Account with the Department of The public entity
(grantor is also Agriculture in the name of a
trustee) public entity (such as a State
b. So-called trust account The actual owner(1) or local government, school
that is not a legal or district, or prison) that
valid trust under state receives agricultural program
law payments
5. Sole proprietorship account The owner(3)
------------------------------------------------------------- -----------------------------------------------------------------
</TABLE>
* If you are an individual, you must generally enter the name shown on your
social security card. However, if you have changed your last name, for
instance, due to marriage, without informing the Social Security
Administration of the name change, enter your first name, the last name
shown on your social security card, and your new last name.
(1) List first and circle the name of the person whose number you furnish. If
only one person on a joint account has a social security number, that
person's number must be furnished.
(2) Circle the minor's name and furnish the minor's social security number.
(3) You must show your individual name and enter your social security number.
(4) List first and circle the name of the legal trust, estate or pension trust.
(Do not furnish the TIN of the personal representative or trustee unless
the legal entity itself is not designated in the account title.)
Note: If no name is circled when more than one name is listed, the number will
be considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER OF SUBSTITUTE FORM W-9
Page 2
Obtaining a TIN
If you do not have a TIN or you do not know your number, obtain Form SS-5,
Application for a Social Security Card (for resident individuals), Form SS-4,
Application for Employer Identification Number (for businesses and all other
entities), Form W-7, Application for IRS Individual Taxpayer Identification
Number (for resident alien individuals required to file U.S. tax returns). You
may obtain Form SS-5 from your local Social Security Administration Office and
Forms SS-4 and W-7 from the IRS by calling 1-800-TAX-FORM (1-800-829-3676) or
from the IRS's Internet Web Site at www.irs.gov.
To complete Substitute Form W-9 if you do not have a TIN, write "Applied For"
in the space for the TIN in Part 1, sign and date the form, and give it to the
payor. Generally, you will then have 60 days to obtain a TIN and furnish it to
the payor. If the payor does not receive your TIN within 60 days, backup
withholding, if applicable, will begin and will continue until you furnish
your TIN to the payor. Note: Writing "Applied For" means that you have already
applied for a TIN OR that you intend to apply for one soon.
Payees Exempt from Backup Withholding
Unless otherwise noted herein, all references below to section numbers or to
regulations are references to the Internal Revenue Code of 1986, as amended,
and the regulations promulgated thereunder.
Payees specifically exempted from backup withholding on ALL payments include
the following:
. A corporation.
. A financial institution.
. An organization exempt from tax under section 501(a), any IRA, or a
custodial account under section 403(b)(7) if the account satisfies the
requirements of section 401(f)(2).
. The United States or any of its agencies or instrumentalities.
. A state, the District of Columbia, a possession of the United States, or
any of their political subdivisions or instrumentalities.
. A foreign government or any of its political subdivisions, agencies or
instrumentalities.
. An international organization or any of its agencies or instrumentalities.
. A dealer in securities or commodities required to register in the United
States, the District of Columbia or a possession of the United States.
. A real estate investment trust.
. A common trust fund operated by a bank under section 584(a).
. An entity registered at all times during the tax year under the Investment
Company Act of 1940.
. A foreign central bank of issue.
Payments Exempt from Backup Withholding
Dividends and patronage dividends that generally are exempt from backup
withholding include:
. Payments to nonresident aliens subject to withholding under section 1441.
. Payments to partnerships not engaged in a trade or business in the United
States and which have at least one nonresident alien partner.
. Payments of patronage dividends not paid in money.
. Payments made by certain foreign organizations.
. Payments made to a middleman known in the investment community as a
nominee or custodian.
Interest payments that generally are exempt from backup withholding include:
. Payments of interest on obligations issued by individuals. Note: You may
be subject to backup withholding if (1) this interest payment is $600 or
more, (2) the interest is paid in the course of the payor's trade or
business and (3) you have not provided a TIN or have provided an incorrect
TIN to the payor.
. Payments of tax-exempt interest (including exempt-interest dividends under
section 852).
. Payments described in section 6049(b)(5) to non-resident aliens.
. Payments on tax-free covenant bonds under section 1451.
. Payments made by certain foreign organizations.
. Payments made to a middleman known in the investment community as a
nominee or custodian.
Exempt payees described above should file a Substitute Form W-9 to avoid
possible erroneous backup withholding. FURNISH YOUR TIN IN PART 1, WRITE
"EXEMPT" IN PART 2, SIGN AND DATE THE FORM AND RETURN IT TO THE PAYOR.
Certain payments other than interest, dividends and patronage dividends that
are not subject to information reporting also are not subject to backup
withholding. For details, see the regulations under sections 6041, 6041A(a),
6045, and 6050A.
Privacy Act Notice. Section 6109 requires you to give your correct TIN to
persons who must file information returns with the IRS to report interest,
dividends and certain other payments. The IRS uses the numbers for
identification purposes and to help verify the accuracy of your tax return.
The IRS also may provide this information to the Department of Justice for
civil and criminal litigation, and to cities, states and the District of
Columbia to carry out their tax laws.
You must provide your TIN to the payor whether or not you are required to file
a tax return. Payors must generally withhold 31% of taxable interest,
dividends, and certain other payments to a payee who does not give a TIN to a
payor. Certain penalties also may apply.
Penalties
(1) Penalty for Failure to Furnish a TIN.--If you fail to furnish your TIN to
a payor, you are subject to a penalty of $50 for each such failure unless your
failure is due to reasonable cause and not to willful neglect.
(2) Civil Penalty for False Statements With Respect to Withholding.-- If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a $500 penalty.
(3) Criminal Penalty for Falsifying Information.-- Willfully falsifying
certifications or affirmations may subject you to criminal penalties including
fines and/or imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE.
