As filed with the Securities and Exchange Commission on January 30, 2001
November 7, 2018
RegistrationNo. 333-
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333-223415
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 1
TO
FORMS-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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| CBS CORPORATION | CBS OPERATIONS INC. | |
| (Exact name of registrant as specified in its charter) | (Exact name of registrant as specified in its charter) |
| Delaware | Delaware | |
(State or other jurisdiction of incorporation or organization) | (State or other jurisdiction of incorporation or organization) | |
| 4833 | 7812 | |
(Primary Standard Industrial Classification Code Number) | (Primary Standard Industrial Classification Code Number) | |
| 04-2949533 | 13-3844753 | |
(I.R.S. Employer Identification Number)
51 West 52nd Street New York, NY 10019 (212)975-4321 (Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices) | (I.R.S. Employer Identification Number)
51 West 52nd Street New York, NY 10019 (212)975-4321 (Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices) |
Lawrence P. Tu
Senior Executive Vice President General Counsel and Secretary
Viacom Inc.
1515 Broadway
Chief Legal Officer
CBS Corporation
51 West 52nd Street
New York, New York 10036
NY 10019
(212) 258-6000
(Name,975-4321
(Name, address, including zip code, and telephone number, including area code, of agent for service)
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Copies to:
Stephen T. Giove, Esq.
Shearman & Sterling
599 Lexington Avenue
New York, New York 10022
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Richard J. Parrino
Kevin K. Greenslade
Hogan Lovells US LLP
555 Thirteenth Street, N.W.
Washington, D.C. 20004
(202)637-5600
Approximate date of commencement of proposed sale of the securities to the public: Upon
consummation of the Exchange Offer described herein.
As soon as practicable after this registration statement becomes effective as determined by CBS Corporation.
If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. |_|
☐
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) 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 thisthe Form is a post-effective amendment filed pursuant to Rule 462(d) 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. |_|
CALCULATION OF REGISTRATION FEE
☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, anon-accelerated filer, a smaller reporting company, or emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule12b-2 of the Exchange Act.
| Large accelerated filer | ☑ | Accelerated filer | ☐ | |||
| Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||
| Emerging growth company | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for the purposescomplying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of calculating the registration fee
in accordance with Rule 457(f) under the Securities Act of 1933, as
amended.
(2) Calculated based upon the market value of the securities to be received
by the registrantsAct. ☐
If applicable, place an X in the exchangebox to designate the appropriate rule provision relied upon in accordance withconducting this transaction:
Exchange Act Rule 457(f).
13e-4(i) (Cross-Border Issuer Tender Offer) ☐
Exchange Act Rule14d-1(d) (Cross-Border Third-Party Tender Offer) ☐
The RegistrantRegistrants hereby amendsamend this Registration Statementregistration statement on such date or dates as may be necessary to delay its effective date until the RegistrantRegistrants shall file a further amendment which specifically states that this Registration Statementregistration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statementregistration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
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The
This information in this prospectus is not complete and may be changed.complete. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any statejurisdiction where the offer or sale is not permitted.
Subject to completion dated January 30, 2001
VIACOM INC.
OFFER
SUBJECT TO EXCHANGE
6.40%COMPLETION, DATED NOVEMBER 7, 2018
PROSPECTUS
Offer To Exchange Up To
$400,000,000
2.900% Senior Notes due 2006
7.70%2023
which have been registered under the Securities Act of 1933
for any and all outstanding
2.900% Senior Notes due 2010
7.875% Senior Debentures due 2030
Unconditionally guaranteed as to payment2023
which have not been registered under the Securities Act of principal
1933
and interest by Viacom International Inc.
(a wholly owned subsidiary of Viacom Inc.)
for all outstanding unregistered
6.40%
$500,000,000
3.700% Senior Notes due 2006
7.70%2028
which have been registered under the Securities Act of 1933
for any and all outstanding
3.700% Senior Notes due 2010
7.875% Senior Debentures due 2030
Unconditionally guaranteed as2028
which have not been registered under the Securities Act of 1933
The Exchange Offer:
We are offering by this prospectus to payment of principal
and interest by Viacom International Inc.
(a wholly owned subsidiary of Viacom Inc.)
TERMS OF EXCHANGE OFFER
This prospectus and accompanying letter of transmittal relate to the
proposed offer by Viacom Inc. to exchange up to $400,000,000 aggregate principal amount of new 6.40%our 2.900% senior notes due 2006,2023, which arewe refer to as the “2023 exchange notes,” and $500,000,000 aggregate principal amount of our 3.700% senior notes due 2028, which we refer to as the “2028 exchange notes” and together with the 2023 exchange notes as the “exchange notes,” all of which have been registered under the Securities Act of 1933, for any and all$400,000,000 aggregate principal amount of its unregistered 6.40%our outstanding 2.900% senior notes due 2006 issued on January 17, 2001,2023, which we refer to as the “2023 original notes,” and $500,000,000 aggregate principal amount of new 7.70%our outstanding 3.700% senior notes due 2010,2028, which arewe refer to as the “2028 original notes” and together with the 2023 original notes as the “original notes,” that we originally issued on November 16, 2017 and that were not registered under the Securities Act of 1933,1933.
We will exchange all original notes that are validly tendered and not withdrawn prior to the expiration of the exchange offer for any and all of its unregistered 7.70% senior notes due 2010 issued
on January 17, 2001 and $750,000,000 aggregatean equal principal amount of new 7.875%
senior debentures due 2030, which are registered under the Securities Act of
1933, for any and all of its unregistered 7.875% senior debentures due 2030
issued on January 17, 2001. The senior securities are unconditionally guaranteed
as to payment of principal and interest by Viacom International Inc., a wholly
owned subsidiary of Viacom. The unregistered senior notes due 2010 will, upon
their exchange for new senior notes due 2010 registered under the Securities Act
of 1933, be a further issuance of our 7.70% Senior Notes due 2010,
$1,150,000,000 of which were issued on August 1, 2000. The unregistered senior
debentures due 2030 will, upon their exchange for senior debentures due 2030
registered under the Securities Act of 1933, be a further issuance of our 7.875%
Senior Debentures due 2030, $500,000,000 of which were issued on August 1, 2000.
The unregistered senior securities have certain transfer restrictions. The
exchange senior securities will be freely transferable.
o notes.
The exchange offer expireswill expire at 5:00 p.m., New York City time, on FebruaryDecember , 2001,2018, unless extended.
o The exchange offer is not subject to any conditions other than
that:
oextended by us.
(continued on next page)
Investment in the exchange offer, or the making of any exchange by a senior
security holder, does not violate applicable law or any
applicable interpretation of the staff of the Securities and
Exchange Commission (the "SEC"),
o no action or proceeding shall have been instituted or
threatened with respect to the exchange offer which, in our
judgment or the judgment of the guarantor, would impair our
ability to proceed with the exchange offer, and
o no law, rule or regulation or applicable interpretations of
the staff of the SEC has been issued or promulgated which, in
our good faith determination or the good faith determination
of the guarantor, does not permit us to effect the exchange
offer.
o All outstanding unregistered senior securities that are validly
tendered and not validly withdrawn will be exchanged.
o Tenders of outstanding unregistered senior securities may be
withdrawn at any time before 5:00 p.m.notes involves risks. See “Risk Factors” on the date of expiration
of the exchange offer.
o The exchange of senior securities will not be a taxable exchange
for U.S. federal income tax purposes.
o We will not receive any proceeds from the exchange offer.
o Application has been made to list the exchange senior securities
on the Luxembourg Stock Exchange.
o The terms of the exchange senior securities to be issued are
substantially similar to the unregistered senior securities,
except for being registered under the Securities Act, not having
any transfer restrictions and not having registration rights or
rights to additional interest.
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Each holder of an unregistered senior security wishing to accept the
exchange offer must deliver the unregistered senior securities to be exchanged,
together with the letter of transmittal that accompanies this prospectus and any
other required documentation, to the exchange agent identified in this
prospectus. Alternatively, you may effect a tender of unregistered senior
securities by book-entry transfer into the exchange agent's account at Morgan
Guaranty Trust Company of New York, Brussels Office, as operator of the
Euroclear System ("Euroclear"), Clearstream Banking, societe anonyme, Luxembourg
("Clearstream Luxembourg") or the Depositary Trust Company ("DTC"). All
deliveries are at the risk of the holder. You can find detailed instructions
concerning delivery in the section called "The Exchange Offer" in this
prospectus and in the accompanying letter of transmittal.
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If you are a broker-dealer that receives exchange senior securities for
your own account you must acknowledge that you will deliver a prospectus in
connection with any resale of the exchange senior securities. The letter of
transmittal accompanying this prospectus states that by so acknowledging and by
delivering a prospectus, you will not be deemed to admit that you are an
"underwriter" within the meaning of the Securities Act. You may use this
prospectus, as we may amend or supplement it in the future, for your resales of
exchange senior securities. We will make this prospectus available to any
broker-dealer for use in connection with any such resale for a period of 180
days after the date of expiration of this exchange offer.
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page 9.
Neither the Securities and Exchange Commission nor any state securities commission nor any other regulatory body has approved or disapproved of the seniorthese securities to be
distributed in the exchange offer, nor have any of these organizationsor determined thatif this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is November , 2001.
You may withdraw tendered original notes at any time prior to the expiration of the exchange offer.
The exchange of original notes for exchange notes pursuant to the exchange offer generally will not be a taxable event for U.S. federal income tax purposes.
We will not receive any proceeds from the exchange offer.
The Exchange Notes:
The terms of the exchange notes will be substantially identical to the terms of the original notes, except that the exchange notes are registered under the Securities Act of 1933 and will bear a different CUSIP number from the original notes of the same series, and the transfer restrictions, registration rights and related additional interest terms applicable to the original notes will not apply to the exchange notes.
The 2023 exchange notes will mature on June 1, 2023 and the 2028 exchange notes will mature on June 1, 2028. We will pay interest on the exchange notes semi-annually on June 1 and December 1 of each year.
The exchange notes will be subject to redemption and entitled to repurchase rights in the circumstances described in this prospectus.
The exchange notes will be unsecured senior obligations of CBS Corporation and will rank equally in right of payment with all of CBS Corporation’s other unsecured and unsubordinated indebtedness from time to time outstanding.
Payment of the exchange notes will be fully and unconditionally guaranteed by CBS Operations Inc. on an unsecured senior basis. The guarantees will be unsecured senior obligations of CBS Operations Inc. and will rank equally in right of payment with all of CBS Operations Inc.’s other unsecured and unsubordinated indebtedness from time to time outstanding.
We do not intend to list the exchange notes on any securities exchange.
Any broker-dealer that holds original notes acquired for its own account as a result of market-making activities or other trading activities, and that receives exchange notes in exchange for such original notes pursuant to the exchange offer, must deliver a prospectus in connection with any resales of such exchange notes. We have agreed that, for a period beginning on the date on which the exchange offer is consummated and ending on the earlier of 180 days after the date of this prospectus and the date on which a broker-dealer is no longer required to deliver a prospectus in connection with market-making activities or other trading activities, we will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. For more information, see “Plan of Distribution.”
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The Securities and Exchange Commission allows us to “incorporate by reference” business and financial information about our company that is not included in or delivered with this prospectus. We will provide to you upon written or oral request, at no cost, a copy of any or all of the information incorporated by reference into this prospectus. To request a copy of any or all of this information, you should write or telephone us at the following address and telephone number:
CBS Corporation
51 West 52nd Street
New York, NY 10019
Attention: Investor Relations
Telephone:1-877-CBS-0787
To obtain timely delivery, you must request incorporated information no later than December , 2018, which is five business days before the scheduled expiration of the exchange offer.
i
This summary highlights selected information included or incorporated by reference into this prospectus. This summary is not intended to be a complete description of the matters covered in this prospectus and is subject to, and qualified in its entirety by, reference to the more detailed information and financial statements (including the notes thereto) included or incorporated by reference into this prospectus.
In this prospectus, unless we indicate otherwise or the context otherwise requires, we use the terms “CBS Corporation,” “we,” “us” and “our” to refer to CBS Corporation and its consolidated subsidiaries. References to “CBS Operations” are references to CBS Operations Inc.
CBS Corporation
We are a mass media company with operations in the following segments:
| • | ENTERTAINMENT: The Entertainment segment is composed of theCBS® Television Network; CBS Television Studios®; CBS Studios International™ and CBS Television Distribution™; Network Ten®; CBS Interactive™; CBS Films®; and our digital streaming services, CBS All Access® and CBSN®. |
| • | CABLE NETWORKS: The Cable Networks segment is composed of Showtime Networks, which operates our premium subscription program services,Showtime®,The Movie Channel®, andFlix®, including a digital streaming subscription offering;CBS Sports Network®, our cable network focused on college athletics and other sports; and Smithsonian Networks™, a venture between Showtime Networks and Smithsonian Institution, which operatesSmithsonian Channel®, a basic cable program service, and a digital streaming subscription service. |
| • | PUBLISHING: The Publishing segment is composed of Simon & Schuster, which publishes and distributes consumer books under imprints such asSimon & Schuster®, Pocket Books®, Scribner®,Gallery Books®,Touchstone®andAtria Books®. |
LOCAL MEDIA: The Local Media segment is composed of CBS Television Stations, our 29 owned broadcast television stations; and CBS Local Digital Media™, which operates local Websites including content from our television stations.
We were organized under the laws of the State of Delaware in 1986. Our principal executive offices are located at 51 West 52nd Street, New York, New York 10019, our telephone number is(212) 975-4321 and our website address is www.cbscorporation.com. The information contained in or accessible through our website is not incorporated by reference in, or part of, this prospectus or the registration statement of which this prospectus forms a part.
CBS Operations Inc.
CBS Operations, the guarantor of the exchange notes, was organized under the laws of the State of Delaware in 1995. CBS Operations maintains its principal executive offices at 51 West 52nd Street, New York, New York 10019 and its telephone number is (212)975-4321. CBS Operations has 100 shares of common stock, par value $.01 per share, outstanding, all of which are held by CBS Corporation. CBS Operations owns a full power broadcast television station in Tampa, Florida and a low power broadcast television station in Indianapolis, Indiana. The direct and indirect subsidiaries of CBS Operations operateShowtime Networks, Simon & Schuster, CBS Television Studiosand ten full power broadcast television stations. In addition, one of such subsidiaries holds the partnership interest inThe CW™ broadcast network.
The Exchange Offer
On November 16, 2017, we completed the offering of $400,000,000 aggregate principal amount of our 2.900% senior notes due 2023 and $500,000,000 aggregate principal amount of our 3.700% senior notes due 2028. The offering was made in transactions not requiring registration under the Securities Act of 1933, as amended (the “Securities Act”). As part of the offering, we entered into a registration rights agreement with the representatives of the initial purchasers of such senior notes in which we agreed, among other matters, to deliver this prospectus and to complete an exchange offer for such senior notes.
The following is a summary of some of the terms of the exchange offer. For a more detailed description, see “The Exchange Offer.”
The Exchange Offer | We are offering to exchange (i) $2,000 principal amount of our 2.900% senior notes due 2023 (and integral multiples of $1,000 principal amount in excess thereof), which have been registered under the Securities Act (the “2023 exchange notes”), for each $2,000 principal amount of our outstanding 2.900% senior notes due 2023 (and integral multiples of $1,000 principal amount in excess thereof), which we originally issued on November 16, 2017 (the “2023 original notes”), and (ii) $2,000 principal amount of our 3.700% senior notes due 2028 (and integral multiples of $1,000 principal amount in excess thereof), which have been registered under the Securities Act (the “2028 exchange notes”), for each $2,000 principal amount of our outstanding 3.700 % senior notes due 2028 (and integral multiples of $1,000 principal amount in excess thereof), which we originally issued on November 16, 2017 (the “2028 original notes”). The 2023 original notes and the 2028 original notes were not registered under the Securities Act. Unless we specify otherwise or the context indicates otherwise, we refer to the 2023 exchange notes and the 2028 exchange notes together as the “exchange notes” and the 2023 original notes and 2028 original notes together as the “original notes.” We also refer to the exchange notes and the original notes together as the “notes.” |
| To be exchanged, an original note must be properly tendered and accepted. All original notes that are validly tendered and not withdrawn will be exchanged. As of the date of this prospectus, there are $400,000,000 aggregate principal amount of 2023 original notes outstanding and $500,000,000 aggregate principal amount of 2028 original notes outstanding. We will issue exchange notes promptly after the expiration of the exchange offer. |
Resales of Exchange Notes | Based on interpretations by the staff of the Securities and Exchange Commission (the “SEC”) inno-action letters issued to third parties with respect to other transactions, we believe that the exchange notes issued in the exchange offer may be offered for resale, resold or otherwise transferred by you without compliance with the registration and prospectus delivery requirements of the Securities Act as long as: |
you are acquiring the exchange notes in the ordinary course of your business;
you have no arrangement or understanding with any person to participate in a distribution (within the meaning of the Securities Act) of the exchange notes; and
you are not our affiliate within the meaning of Rule 405 under the Securities Act, which defines “affiliate” as a person that, directly or indirectly, controls or is controlled by, or is under common control with, a specified person.
| If you do not satisfy the foregoing conditions, in the absence of an exemption, you must comply with the registration and prospectus delivery requirements of the Securities Act in connection with the resale of the exchange notes. If you fail to comply with these requirements, you may incur liabilities under the Securities Act, and we will not indemnify you for such liabilities. |
| Each broker-dealer that receives exchange notes for its own account in exchange for original notes that were acquired as a result of market-making activities or other trading activities must acknowledge that it will comply with the registration and prospectus delivery requirements of the Securities Act in connection with any offer to resell, resale or other transfer of the exchange notes issued in the exchange offer. We have agreed in a registration rights agreement that, for a period beginning on the date on which the exchange offer is consummated and ending on the earlier of 180 days after the date of this prospectus and the date on which a broker-dealer is no longer required to deliver a prospectus in connection with market-making activities or other trading activities, we will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. For additional information, see “Plan of Distribution.” |
Expiration Date | The exchange offer will expire at 5:00 p.m., New York City time, on December , 2018, unless extended by us. |
Withdrawal Rights | You may withdraw tenders of the original notes at any time prior to the expiration of the exchange offer. For additional information, see “The Exchange Offer—Terms of the Exchange Offer.” |
Conditions to the Exchange Offer | The exchange offer is subject to customary conditions, which we may waive in our sole discretion, subject to applicable law. For additional information, see “The Exchange Offer—Conditions to the Exchange Offer.” The exchange offer for either series of original notes is not conditioned upon the exchange of any minimum aggregate principal amount of original notes of such series. |
Procedures for Tendering Original Notes | If you wish to accept the exchange offer, you must (i) complete, sign and date the accompanying letter of transmittal, or a facsimile copy of such letter, in accordance with its instructions and the instructions in |
this prospectus, and (ii) mail or otherwise deliver the executed letter of transmittal, together with the original notes and any other required documents, to the exchange agent at the address set forth in the letter of transmittal. If you are a broker, dealer, commercial bank, trust company or other nominee and you hold original notes through The Depository Trust Company (“DTC”) and wish to accept the exchange offer, you must do so pursuant to DTC’s procedures. For additional information, see “The Exchange Offer—Procedures for Tendering.” |
| If you are a beneficial owner whose original notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and you wish to tender your original notes in the exchange offer, we urge you to contact promptly the person or entity in whose name your original notes are registered and instruct that person or entity to tender those original notes on your behalf. If you wish to tender original notes in the exchange offer on your own behalf, before completing and executing the letter of transmittal and delivering your original notes, you must either make appropriate arrangements to register ownership of your original notes in your name or obtain a properly completed bond power from the person or entity in whose name your original notes are registered. The transfer of registered ownership may take considerable time. |
Guaranteed Delivery Procedures | If you wish to tender your original notes and your original notes are not immediately available or you cannot deliver your original notes, the letter of transmittal or any other required documents to the exchange agent (or comply with the procedures for book-entry transfer) prior to the expiration date, you must tender your original notes according to the guaranteed delivery procedures set forth in “The Exchange Offer—Guaranteed Delivery Procedures.” |
Consequences of Failure to Exchange | If you do not exchange your original notes, they will remain entitled to the rights and subject to the limitations contained in the indenture pursuant to which the original notes were issued. Following the exchange offer, all outstanding original notes will continue to be subject to the same restrictions on transfer, and we will have no obligation to register outstanding original notes under the Securities Act (except in the limited circumstances provided in the registration rights agreement) or to pay contingent increases in interest based on our original registration obligation. |
Use of Proceeds | We will not receive any cash proceeds from the issuance of the exchange notes in the exchange offer. |
Taxation | The exchange pursuant to the exchange offer generally will not be a taxable event for U.S. federal income tax purposes. For additional information, see “U.S. Federal Income Tax Considerations—Exchange of Original Notes for Exchange Notes.” |
Risk Factors | See “Risk Factors” on page 9 of this prospectus for additional information regarding factors you should carefully consider before deciding whether to invest in the exchange notes. |
Exchange Agent | Deutsche Bank Trust Company Americas is serving as the exchange agent in connection with the exchange offer. You should direct questions and requests for assistance, requests for additional copies of this prospectus or of the letter of transmittal and requests for notices of guaranteed delivery to the exchange agent addressed as follows: |
| By Registered or Certified Mail, | ||||||
| Overnight Delivery, Courier or Electronic Mail: | ||||||
| DB Services Americas, Inc. | ||||||
| MS: JCK01-0218 | ||||||
| Attention: Reorg. Department | ||||||
| 5022 Gate Parkway, Suite 200 | ||||||
| Jacksonville, FL 32256 | ||||||
| DB.Reorg@db.com | ||||||
| By Facsimile Transmission: | ||||||
| (615)866-3889 | ||||||
| To Confirm by Telephone: | ||||||
| (877)843-9767 | ||||||
The Exchange Notes
The exchange offer relates to the exchange of up to $400,000,000 principal amount of 2023 exchange notes for an equal principal amount of 2023 original notes and up to $500,000,000 principal amount of 2028 exchange notes for an equal principal amount of 2028 original notes. The terms of the exchange notes will be substantially identical to the terms of the original notes, except that the exchange notes are registered under the Securities Act and will bear a different CUSIP number from the original notes of the same series, and the transfer restrictions, registration rights and related additional interest terms applicable to the original notes will not apply to the exchange notes. The exchange notes will evidence the same indebtedness as the original notes which they will replace.
The following is a summary of some of the terms of the exchange notes. For a more detailed description, see “Description of the Exchange Notes.”
Issuer | CBS Corporation |
Notes Offered | $400,000,000 aggregate principal amount of 2.900% senior notes due 2023 and $500,000,000 aggregate principal amount of 3.700% senior notes due 2028 |
| The original notes were, and the exchange notes will be, issued under the indenture pursuant to which, on November 16, 2017, we issued $400,000,000 principal amount of our 2.900% senior notes due 2023 and $500,000,000 aggregate principal amount of our 3.700% senior notes due 2028. |
Maturity | The 2023 exchange notes will mature on June 1, 2023. |
| The 2028exchange notes will mature on June 1, 2028. |
Interest | Interest on the 2023 exchange notes will accrue at the rate of 2.900% per year, payable semi-annually in arrears on June 1 and December 1 of each year. Interest on the 2023 exchange notes will accrue from November 16, 2017 (or from the most recent interest payment date to which interest has been paid or duly provided for with respect to the 2023 original notes or the 2023 exchange notes). |
| Interest on the 2028 exchange noteswill accrue at the rate of 3.700% per year, payable semi-annually in arrears on June 1 and December 1 of each year. Interest on the 2028 exchange notes will accrue from November 16, 2017 (or from the most recent interest payment date to which interest has been paid or duly provided for with respect to the 2028 original notes or the 2028 exchange notes). |
Guarantee | The exchange notes will be fully and unconditionally guaranteed on an unsecured senior basis by CBS Operations. |
Ranking | The exchange notes will be unsecured senior obligations of CBS Corporation and will rank equally in right of payment with all of CBS Corporation’s other unsecured and unsubordinated indebtedness from |
time to time outstanding. As of September 30, 2018, CBS Corporation had approximately $9.39 billion of long-term indebtedness outstanding, all of which will rank equally in right of payment with the exchange notes. As of September 30, 2018, our direct and indirect subsidiaries, other than CBS Operations, had approximately $92 million of indebtedness outstanding. CBS Operations is a wholly owned subsidiary of CBS Corporation with no long-term indebtedness outstanding as of September 30, 2018, other than its guarantees of the senior debt of CBS Corporation, all of which is fully and unconditionally guaranteed by CBS Operations. The direct and indirect subsidiaries of CBS Operations had approximately $16 million of long-term indebtedness outstanding as September 30, 2018. |
Sinking Fund | None |
Optional Redemption | We may redeem the exchange notes, in whole or in part, at any time and from time to time at a redemption price equal to the principal amount of the exchange notes being redeemed plus the applicable premium, if any, and accrued and unpaid interest to the redemption date. In addition, commencing on May 1, 2023 (one month prior to their maturity date), we may redeem the 2023 exchange notes, in whole or in part, at any time and from time to time at a redemption price equal to 100% of the principal amount of the 2023 exchange notes being redeemed plus accrued and unpaid interest to the redemption date, and, commencing on March 1, 2028(threemonths prior to their maturity date), we may redeem the 2028 exchange notes, in whole or in part, at any time and from time to time at a redemption price equal to 100% of the principal amount of the 2028 exchange notesbeing redeemed plus accrued and unpaid interest to the redemption date. See “Description of the Exchange Notes—Optional Redemption.” |
Purchase of Exchange Notes Upon a Change of Control Repurchase Event | Upon the occurrence of both a change of control of CBS Corporation and a downgrade of the exchange notes below an investment grade rating by all of Moody’s Investors Service Inc., Standard & Poor’s Ratings Services and Fitch Ratings, Ltd. within a specified period, unless we have exercised our right of redemption, we will be required to make an offer to repurchase all or any part of each holder’s exchange notes at a price equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest, if any, to the date of repurchase. See “Description of the Exchange Notes—Purchase of Exchange Notes Upon a Change of Control Repurchase Event.” |
Certain Covenants | We will issue the exchange notes under an indenture that, among other restrictions, limits our ability to: |
consolidate, merge or sell all or substantially all of our assets;
create liens; and
enter into sale and leaseback transactions.
| All of these limitations are subject to a number of important qualifications and exceptions. See “Description of the Exchange Notes—Certain Covenants.” |
Form and Settlement | Each series of exchange notes will be issued in the form of one or more fully registered global notes which will be deposited with, or on behalf of, DTC, as the depositary, and registered in the name of Cede & Co., DTC’s nominee. Beneficial interests in the global notes will be represented through book-entry accounts of financial institutions acting on behalf of beneficial owners as direct and indirect participants in DTC. Investors may elect to hold interests in the global notes through either DTC (in the United States) or Clearstream Banking,société anonyme (“Clearstream”) or Euroclear Bank S.A./N.V. (“Euroclear”) (outside of the United States), if they are participants in these systems, or indirectly through organizations which are participants in these systems. Cross-market transfers between persons holding directly or indirectly through DTC participants, on the one hand, and directly or indirectly through Clearstream or Euroclear participants, on the other hand, will be effected in accordance with DTC rules on behalf of the relevant international clearing system by its U.S. depositary. |
Markets | The exchange notes are offered for sale in those jurisdictions in the United States, and certainnon-U.S. jurisdictions, where it is legal to make such offers. |
Governing Law | The exchange notes and the guarantees will be, and the indenture under which they will be issued is, governed by the laws of the State of New York. |
Investing in the exchange notes involves risks. You should rely onlycarefully consider the risks set forth below and the risks described in the “Risk Factors” section beginning on pageI-16 of our Annual Report on Form10-K for the year ended December 31, 2017, which are incorporated by reference into this prospectus, as well as the other information contained or incorporated by reference into this prospectus, before making a decision whether to invest in the exchange notes. See “Where You Can Find Additional Information” in this prospectus for information about how you can obtain or view copies of incorporated information.
If an active trading market for the exchange notes does not develop or is not sustained, you may not be able to resell them at their fair market value or at all.
The exchange notes are a new issue of securities with no established trading market. An active trading market may not develop or be sustained for the exchange notes. We do not intend to list the exchange notes on any national securities exchange or automated quotation system. The liquidity of any trading market in the exchange notes, and the market price quoted for the exchange notes, may be adversely affected by changes in the overall market for fixed income securities or in prevailing interest rates, changes in our financial performance or prospects or in the prospects for companies in our industry in general, and other factors, including general economic conditions. If an active trading market does not develop or is not sustained, you may not be able to resell your exchange notes at their fair market value or at all.
The exchange offer may be canceled or delayed.
The consummation of the exchange offer is subject to, and conditional upon, the satisfaction or waiver of the conditions discussed under “The Exchange Offer—Conditions to the Exchange Offer.” We may, at our option and in our sole discretion (subject to applicable legal requirements), waive any such conditions. Even if the exchange offer is completed, the exchange offer may not be completed on the schedule described in this prospectus. WeAccordingly, holders participating in the exchange offer may have to wait longer than expected to receive their exchange notes, during which time those holders of the original notes will not authorized anybe able to effect transfers of their original notes tendered for exchange.
Late deliveries of original notes and other person to providerequired documents could prevent you from exchanging your original notes for exchange notes.
Holders are responsible for complying with different or additional information. If anyone provides you with different or
additional information, you should not rely on it. You should assume thatall exchange offer procedures. The issuance of exchange notes in exchange for original notes will occur only upon completion of the information contained or incorporated by referenceprocedures described in this prospectus is
accurate asunder “The Exchange Offer.” Therefore, holders of original notes that wish to exchange them for exchange notes should allow sufficient time for timely completion of the date onexchange offer procedures. Neither we nor the front cover of this prospectus orexchange agent are obligated to extend the date of the
document incorporated by reference. Our business, financial condition, results
of operations and prospects may have changed since then. We are not making an
offer to sell the senior securities in any jurisdiction where theexchange offer or sale
isnotify you of any failure to follow the proper procedures or to waive any defect if you fail to follow the proper procedures.
If you fail to exchange your original notes for exchange notes, it may be difficult to resell your original notes.
The original notes were not permitted.
TABLE OF CONTENTS
Page
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CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS..................ii
WHERE YOU CAN FIND MORE INFORMATION........................................iii
PROSPECTUS SUMMARY...........................................................1
RECENT DEVELOPMENTS..........................................................2
DESCRIPTION OF THE EXCHANGE SENIOR SECURITIES................................9
SELECTED FINANCIAL DATA FOR VIACOM..........................................11
SELECTED FINANCIAL DATA FOR CBS.............................................12
SUMMARY UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION..................13
RATIO OF EARNINGS TO FIXED CHARGES..........................................14
RISK FACTORS................................................................15
USE OF PROCEEDS.............................................................15
CAPITALIZATION..............................................................16
THE EXCHANGE OFFER..........................................................17
DESCRIPTION OF SENIOR SECURITIES............................................31
UNITED STATES TAX CONSIDERATIONS............................................46
PLAN OF DISTRIBUTION........................................................51
LEGAL MATTERS...............................................................52
EXPERTS.....................................................................52
---------------
References to "Viacom," "we," "us"registered under the Securities Act or under the securities laws of any state, and "our" in this prospectus are
references to Viacom Inc. References to "Viacom International" are references to
Viacom International Inc. Whenever we refer in this prospectus to the seniorif you do not exchange your original notes due 2006 issued on January 17, 2001, the seniorfor exchange notes due 2010 issued on
January 17, 2001, or the senior debentures due 2030 issued on January 17, 2001,
we will refer to them as the "unregistered 2006 senior notes", the "unregistered
2010 senior notes", or the "unregistered senior debentures", respectively.
Whenever we refer collectively in this prospectus to the unregistered 2006
senior notes, the unregistered 2010 senior notes and the unregistered senior
debentures, we will refer to them as the "unregistered senior securities".
Whenever we refer in this prospectus to the new senior notes due 2006, the new
senior notes due 2010 or the new senior debentures due 2030, we will refer to
them as the "exchange 2006 senior notes", the "exchange 2010 senior notes" or
the "exchange senior debentures", respectively. Whenever we refer collectively
in this prospectuspursuant to the exchange 2006 senioroffer, you will not be able to offer, sell or otherwise transfer the original notes unless they are registered under the Securities Act or unless you offer, sell or otherwise transfer them under an exemption from the registration requirements of, or in a transaction not subject to, the Securities Act and applicable state securities laws. Following the exchange 2010
senior securitiesoffer, we will no longer be under an obligation to register outstanding original notes under the Securities Act except in the limited circumstances provided in the registration rights agreement. In addition, any original notes tendered and exchanged in the exchange senior debentures,offer will reduce the aggregate principal amount of the applicable series of outstanding original notes. Because we expect that most holders of original notes will referelect to them asexchange their original notes, the "exchange senior securities". The unregistered 2006 seniorliquidity of any trading market for any original notes andremaining after the completion of the exchange 2006 senior notes are collectively referred to as the "2006 senior
notes"; the unregistered 2010 senior notes and the exchange 2010 senior notes
are collectively referred to as the "2010 senior notes"; the unregistered senior
debentures and the exchange senior debentures are collectively referred to as
the "senior debentures"; and the unregistered senior securities and the exchange
senior securities are collectively referred to as the "senior securities".
References to "$" and "dollars" are to United States dollars.
i
CAUTIONARY STATEMENT CONCERNINGoffer could be substantially limited.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated by reference into this prospectus contain both historical and forward-looking statements. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements within the meaning of section 27A of the Securities
Act and section 21E of the Securities Exchange Act of 1934.federal securities laws. These forward-looking statements are not based on historical facts, but rather reflect our current expectations concerning future results and events. These forward-looking statements generally can be identified by the use of statements that include phrases such as "believe," "expect," "anticipate," "intend," "plan,"
"foresee," "likely," "will"“believe,” “expect,” “anticipate,” “intend,” “plan,” “foresee,” “likely,” “will,” “may,” “could,” “estimate” or other similar words or phrases. Similarly, statements that describe our objectives, plans or goals are or may be forward-looking statements. These forward-looking statements involve known and unknown risks, uncertainties and other factors whichthat are difficult to predict and that may cause our actual results, performance or achievements to be different from any future results, performance and achievements expressed or implied by these statements. These risks, uncertainties and other factors include, among others:
changes in the public acceptance of our content;
advertising market conditions generally;
changes in technology and its effect on competition in our markets;
changes in federal communications laws and regulations;
the impact of piracy on our products;
the impact of consolidation in the market for our content;
the impact of negotiations or the loss of affiliation agreements or retransmission agreements;
the outcomes of investigations and related legal actions, which are inherently unpredictable, and any associated costs;
the uncertainties arising from transitions involving senior executives and directors of the Company;
the impact of union activity, including possible strikes or work stoppages or our inability to negotiate favorable terms for contract renewals;
other domestic and global economic, business, competitive and/or other regulatory factors affecting our businesses generally; and
other factors described in our filings made under the securities laws, including, among others, the factors set forth under “Item 1A. Risk Factors” in our Annual Report on Form10-K for the year ended December 31, 2017, which are incorporated by reference herein.
There may be additional risks, uncertainties and factors that we do not currently view as material or that are not necessarily known. The forward-looking statements included in this prospectus are made only as of the date of this prospectus, and any forward-looking statements incorporated by reference herein are made only as of the date of the incorporated document. We expressly disclaim any obligation to update any forward-looking statement to reflect subsequent events or circumstances, except as otherwise required by applicable law or the rules and regulations promulgated by the SEC.
You should carefully review carefully all information, including the financial statements and the notes to the financial statements, included or incorporated by reference into this prospectus.
In addition
Further information concerning CBS Corporation and its businesses, including factors that potentially could materially affect CBS Corporation’s financial results, is included in our filings with the SEC, and holders of notes are encouraged to the risk factors described below under "Risk Factors,"
the following important factorsreview these filings. Actual results could affect future results, causing these
results to differ materially from thoseexpectations expressed in ourthe forward-looking statements:
ostatements if one or more of the timing, impactunderlying assumptions and other uncertainties relatedexpectations proves to pending and
future acquisitions and dispositions by Viacom;
o the abilitybe inaccurate or is unrealized. CBS Corporation does not undertake responsibility for updating any of Viacom to renew existing programming, licensing and
distribution agreements and to enter into new agreements;
o the impactsuch information, whether as a result of new technologies, includinginformation, future events or otherwise, except as required by law.
We will not receive any cash proceeds from the magnitudeissuance of equity
lossesthe exchange notes in the exchange offer.
In consideration for issuing the exchange notes, we will receive in exchange the original notes in the same principal amount. The terms of the exchange notes will be substantially identical to the terms of the original notes, except that the exchange notes are registered under the Securities Act and other uncertainties related to Viacom's Internet-based
investments;
o changes in tax requirements, including tax rate changes, new tax
laws and revised tax law interpretations; and
o interest rate fluctuations and other capital market conditions.
These factorswill bear a different CUSIP number from the original notes of the same series, and the other risk factors describedtransfer restrictions, registration rights and related additional interest terms applicable to the original notes will not apply to the exchange notes. The original notes surrendered in this prospectus
or incorporated by reference areexchange for the exchange notes will be retired and canceled and may not necessarily allbe reissued. Accordingly, issuance of the important factors
that could cause actual results to differ materially from those expressedexchange notes will not result in any increase in our outstanding indebtedness or in the obligations of our forward-looking statements. Other unknown or unpredictable factors also
could have material adverse effects on our future results. CBS Operations as guarantor of the notes.
RATIO OF EARNINGS TO FIXED CHARGES
The forward-looking
statements includedfollowing table shows the ratio of earnings to fixed charges of CBS Corporation for the periods indicated.
For purposes of computing the following ratio of earnings to fixed charges, earnings represents earnings (loss) from continuing operations before income taxes, equity in this prospectus are made onlyearnings (loss) of investee companies and fixed charges, adjusted for inclusion of distributions from investee companies. Fixed charges represents interest expense, net of capitalized interest, and such portion of rental expense that represents an appropriate interest factor.
| Nine Months Ended September 30, | Twelve Months Ended December 31, | |||||||||||||||||||||||
| 2018 | 2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||||||||||
Ratio of earnings to fixed charges | 5.4x | 4.8x | 5.8x | 6.0x | 5.4x | 6.4x | ||||||||||||||||||
Set forth below is information as of November 1, 2018 concerning each person who serves as of the date of this prospectus and under section 27Aas an executive officer or director of the Securities ActCompany:
Name | Age | Position | ||
| Joseph R. Ianniello | 50 | President and Acting Chief Executive Officer | ||
| Jonathan H. Anschell | 50 | Executive Vice President, Deputy General Counsel and Secretary | ||
| Richard M. Jones | 53 | Executive Vice President and General Tax Counsel | ||
| Lawrence Liding | 50 | Executive Vice President, Controller and Chief Accounting Officer | ||
| Christina Spade | 49 | Executive Vice President, Chief Financial Officer | ||
| Lawrence P. Tu | 64 | Senior Executive Vice President and Chief Legal Officer | ||
| Candace K. Beinecke | 71 | Director | ||
| Barbara M. Byrne | 64 | Director | ||
| Gary L. Countryman | 79 | Director | ||
| Brian Goldner | 55 | Director | ||
| Linda M. Griego | 71 | Director | ||
| Robert N. Klieger | 46 | Director | ||
| Martha L. Minow | 63 | Director | ||
| Shari Redstone | 64 | Director | ||
| Susan Schuman | 59 | Director | ||
| Strauss Zelnick | 61 | Director (Interim Chairman of the Board) | ||
Mr. Ianniello has been President and section 21EActing Chief Executive Officer of the Exchange ActCompany since September 2018, having served as Chief Operating Officer of the Company since June 2013. Prior to that, Mr. Ianniello served as Executive Vice President and we do not have any obligationChief Financial Officer of the Company since August 2009. Previously, he served as Deputy Chief Financial Officer of the Company since November 2008, as Senior Vice President, Chief Development Officer and Treasurer of the Company since September 2007, as Senior Vice President, Finance and Treasurer of the Company since January 1, 2006, as Senior Vice President and Treasurer of Viacom Inc. (referred to publicly update any
forward-looking statementsherein for the period prior to reflect subsequent events or circumstances. We
cannot assure youits separation from the Company on December 31, 2005 as “Former Viacom”) since July 2005 and as Vice President, Corporate Development of Former Viacom from 2000 to 2005.
Mr. Anschell has been Executive Vice President, Deputy General Counsel and Secretary of the Company since January 1, 2016. Mr. Anschell also serves as Executive Vice President and General Counsel of CBS Broadcasting Inc., a position he has held since joining the Company in 2004. Mr. Anschell previously was a partner with the law firm White O’Connor Curry in Los Angeles, California.
Mr. Jones has been Executive Vice President and General Tax Counsel since August 2014. Previously, he served as Senior Vice President and General Tax Counsel of the Company since January 1, 2006 and for Former Viacom in December 2005. Prior to that, projected results or events will be achieved.
ii
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterlyhe served as Vice President of Tax, Assistant Treasurer and current reports, proxy statementsTax Counsel for NBC Universal, Inc. since 2003 and he spent 13 years with Ernst & Young in their media and entertainment and transaction advisory services practices. Mr. Jones also serves as the Company’s Chief Veteran Officer and served honorably as a non-commissioned officer in the U.S. Army’s 75th Ranger Regiment and 10th Mountain Division.
Mr. Liding has been Executive Vice President, Controller and Chief Accounting Officer of the Company since August 2014. Previously, he served as Senior Vice President, Controller and Chief Accounting Officer of the Company since October 2011, Vice President, Deputy Controller of the Company since March 2010 and Vice President, Assistant Controller since January 1, 2006. Prior to that, Mr. Liding joined Former Viacom in 1995 and served as Vice President of Financial Reporting from 2002 through 2005.
Ms. Spade has been Executive Vice President, Chief Financial Officer of the Company since October 2018. Previously, she served as Executive Vice President, Chief Financial Officer and Strategy for Showtime Networks Inc. (“Showtime”) since 2013. Prior to that, Ms. Spade served as Senior Vice President, Affiliate Finance and Business Operations for Showtime since 2003. Prior to joining Showtime in 1997, Ms. Spade was an Audit Manager with PricewaterhouseCoopers LLP in the Entertainment, Media and Communications practice.
Mr. Tu has been Senior Executive Vice President and Chief Legal Officer of the Company since January 1, 2014. Previously, Mr. Tu served as Senior Vice President, General Counsel and Secretary of Dell Inc. since July 2004. Prior to that, Mr. Tu served as Executive Vice President and General Counsel of NBC Universal since 2001. He previously was a partner with the law firm O’Melveny & Myers LLP and also served five years as managing partner of the firm’s Hong Kong office. Mr. Tu’s prior experience also includes serving as General Counsel Asia-Pacific for Goldman Sachs, attorney for the U.S. State Department, and law clerk for U.S. Supreme Court Justice Thurgood Marshall.
Ms. Beinecke is the Senior Partner of Hughes Hubbard & Reed LLP, a New York law firm, and is a practicing partner in Hughes Hubbard’s corporate department. In 1999, Ms. Beinecke became the first woman to Chair a major New York law firm. Ms. Beinecke also serves as the Lead Trustee of Vornado Realty Trust, the Chairperson of the Board of First Eagle Funds (a mutual fund family), and as a board member of ALSTOM (a public French transport company). As the long-time lead of a top-ranked international law firm, Ms. Beinecke is well-recognized in the legal profession for her corporate governance and mergers and acquisitions expertise and brings to the Board extensive legal, governance, business and risk management experience. Ms. Beinecke’s breadth of director experience, which includes service as a lead trustee and chairperson, as well as service on other nominating and governance committees, a remuneration committee and an executive committee, gives her a deep understanding of public company governance.
Ms. Byrne is the former Vice Chairman, Investment Banking at Barclays PLC. During her more than 35 years of financial services experience, Ms. Byrne served as team leader for some of Barclays’ most important multinational corporate clients and was the primary architect of several of Barclays’ marquee transactions. Widely recognized as a leading investment banker and strategic advisor, she is a member of various industry councils and participates as a forum leader on strategic issues and trends facing the financial services sector and global markets. With this experience, Ms. Byrne brings to the Board important business and financial expertise in its deliberations on complex transactions, risk management, strategy and other informationfinancial matters.
Mr. Countryman has been Chairman Emeritus of the Liberty Mutual Group since 2000. He served as Chairman of Liberty Mutual Group from 1986 to 2000 and as Chief Executive Officer from 1986 to 1998. Mr. Countryman’s 40-year career in the insurance industry provides the Board with financial expertise and an understanding of the SEC. You may readmanagement of risk from an insurance perspective. His leadership in transforming Liberty Mutual from a domestic to an international financial services group and copy any document we fileoverseeing a complex, highly regulated group of insurance companies is relevant to the Board’s oversight of the Company’s global businesses and complex regulations. Mr. Countryman is an experienced director, whose breadth of experience includes experience on executive personnel, executive, investment and nominating committees.
Mr. Goldner has served as the Chief Executive Officer of Hasbro, Inc. since 2008, and additionally has served as its Chairman of the Board since May 2015. In addition to being Chief Executive Officer, from 2008 to 2016, Mr. Goldner was also the President of Hasbro. Besides being a member of Hasbro’s board, he also serves on the board of directors of The Gap, Inc. and served on the Board of Molson Coors Brewing Company from
2010 to 2016. Mr. Goldner brings to the Board significant leadership, operational and brand management experience from his executive positions at one of the leading public companies in his industry, where he was instrumental in transforming a traditional toy and game company into a global play and entertainment leader. With his direct experience in executing on strategies to differentiate Hasbro in a competitive global marketplace in response to industry evolution, he is well-positioned to advise on the strategic direction of the Company’s businesses. Further, Mr. Goldner’s service on other boards and board committees gives him a deep understanding of public company governance.
Ms. Griego has served, since 1986, as President and Chief Executive Officer of Griego Enterprises, Inc., a business management company. For more than 20 years, she oversaw the operations of Engine Co. No. 28, a prominent restaurant in downtown Los Angeles that she founded in 1988. From 1990 to 2000, Ms. Griego held a number of government-related appointments, including Deputy Mayor of the city of Los Angeles, President and Chief Executive Officer of the Los Angeles Community Development Bank, and President and Chief Executive Officer of Rebuild LA, the agency created to jump-start inner-city economic development following the 1992 Los Angeles riots. Over the past two decades, she has also served on a number of government commissions and boards of directors of nonprofit organizations, including current service on the boards of The Ralph M. Parsons Foundation, the MLK Health and Wellness CDC, and the Charles R. Drew University of Medicine and Science. Ms. Griego has served as a director of publicly traded and private corporations, including presently serving as director of AECOM and the American Funds (7 funds). With the breadth of her leadership experience as a businesswoman, in the public sector through her multiple government appointments and extensive community-based participation in Los Angeles, an area where the Company has a significant presence, and on multiple not-for-profit boards, Ms. Griego provides the Board with financial and business acumen, as well as public policy expertise as it relates to business practices. Ms. Griego is also an experienced director, including through service on other audit, compensation and organization, and nominating and governance committees, with demonstrated expertise in the application of sound corporate governance principles.
Mr. Klieger is a partner in the Los Angeles law firm Hueston Hennigan LLP. Mr. Klieger’s practice focuses on complex civil litigation and counseling in the areas of entertainment and intellectual property. Mr. Klieger represents motion picture studios, broadcast and cable television networks, production companies, video game publishers and high net worth individuals in the media and entertainment space, as well as clients in other industries including apparel, aviation and venture capital. Prior to joining Hueston Hennigan, Mr. Klieger was a partner at Irell & Manella LLP and a founding partner at Kendall Brill & Klieger LLP. Before beginning his career in private practice, Mr. Klieger served as a law clerk to the Honorable Cynthia Holcomb Hall of the United States Court of Appeals for the Ninth Circuit, and the Honorable William Matthew Byrne, Jr. of the United States District Court for the Central District of California. Mr. Klieger is recognized as one of the most prominent attorneys in the entertainment industry, with a practice focused on complex civil litigation and counseling in the areas of media, entertainment and intellectual property and clients that include leading enterprises in television, film and digital media. With his exceptional legal acumen and distinguished reputation for his trial practice and counsel, Mr. Klieger brings to the Board legal and strategic expertise in matters germane to the Company’s businesses and complex business transactions.
Ms. Minow is the 300th Anniversary University Professor at Harvard University. Ms. Minow has taught at Harvard Law School since 1981 and served as Dean of the Harvard Law School from 2009 through June 2017. A fellow of the American Academy of Arts & Sciences since 1992, Ms. Minow has also been a senior fellow of Harvard’s Society of Fellows, a Fellow of the American Bar Foundation, and a Fellow of the American Philosophical Society. She has served extensively on government commissions and boards of directors of nonprofit organizations, including current service as Vice-Chair of the Legal Services Corporation, a trustee of the MacArthur Foundation and an advisory council member of the MIT Media Lab, among others. She is also the author of numerous books and scholarly articles in journals of law, history and philosophy. Ms. Minow’s 37-year career at Harvard Law School, including her tenure as Dean of Harvard Law School, reflects exceptional achievements in academia. As the former chief executive of the Harvard Law School, Ms. Minow brings extensive leadership and administrative and management experience to the Board. Her distinguished legal
expertise on public policy issues will provide the Board with meaningful insight on matters relating to social and governance policies and corporate reputation. She is also an experienced director, through her many years of service on government commissions and numerous boards of directors of nonprofit organizations.
Ms. Redstone is a media executive with a wide-ranging background in numerous aspects of the entertainment industry and related ventures. She is Non-Executive Vice Chair of the Company’s Board of Directors. She is also Non-Executive Vice Chair of the Board of Directors of Viacom, a position to which she was elected January 1, 2006. Ms. Redstone is Co-founder and Managing Partner of Advancit Capital, an investment firm launched in 2011 that focuses on early stage companies at the SEC's public reference rooms at 450 Fifth Street, N.W., Washington, D.C.
20549; 7 World Trade Center, Suite 1300, New York, New York 10048;intersection of media, entertainment and 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. Please calltechnology. Advancit is an investor in more than 75 companies. Since 2000, she has been President of National Amusements and is also a director. Ms. Redstone earned a BS from Tufts University and a JD and a Masters in Tax Law from Boston University. She practiced corporate law, estate planning and criminal law in the SEC at
1-800-SEC-0330 for further informationBoston area before joining National Amusements. Ms. Redstone serves on the public reference rooms. Our SEC
filings are also availableBoard of Trustees for the Paley Center for Media and is actively involved in a variety of charitable, civic and educational organizations. She is a member of the Board of Directors at Combined Jewish Philanthropies and the John F. Kennedy Library Foundation. Ms. Redstone sits on the Board of Trustees at Dana-Farber Cancer Institute. Ms. Redstone brings to the Board, and to her position as its Vice Chair, extensive industry and executive expertise, as well as legal acumen from her prior experience as a practicing attorney. That broad experience and entertainment industry knowledge directly assist the Board in overseeing the management of the Company. Ms. Redstone also brings to the Board’s deliberations a direct knowledge of global growth strategies for the Company’s businesses. She is an experienced director through her service on the boards of multiple industry associations, other public fromcompanies and charitable organizations. Ms. Redstone also provides institutional knowledge of the SEC's web siteCompany and continuity to the Company’s Board, having served as a Board member for 25 years.
Ms. Schuman is the Chief Executive Officer and Co-Founder of SYPartners LLC, a consultancy firm that partners with chief executive officers and their leadership teams undergoing business and cultural transformation. Over the past 20 years, Ms. Schuman has built and led SYPartners, working with executives at http://www.sec.gov. Ourmany high-profile companies and organizations. This experience in advising on business, organization and cultural transformation, including new value creation strategies, positions Ms. Schuman as a skilled advisor to the Board on the strategic and transformational direction of the Company.
Mr. Zelnick has served as the Chairman of the Board and the Chief Executive Officer of Take-Two Interactive Software, Inc. since 2007 and 2011, respectively. He is also the founder of, and a partner in, Zelnick Media Capital (ZMC), a leading media-focused private equity firm. In addition to being a member of Take-Two Interactive’s board, he also serves on the board of directors of Starwood Property Trust, Inc. Through an accomplished career serving in various executive and operational roles at numerous global entertainment companies, as well as originating, structuring and monitoring private equity investments in the media and communications industries, Mr. Zelnick brings to the Board significant leadership experience in these industries. With this experience, he is well-positioned to advise on the strategic direction of the Company’s businesses. He is also an experienced director, including through his service on audit, compensation, investment and nominating and governance committees, giving him a deep understanding of public company governance.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The table below sets forth as of September 30, 2018, unless otherwise indicated, information concerning the beneficial ownership of the Company’s Class A common stock and Class B common stock are listed
onCommon Stock by (i) each current director, (ii) each named executive officer identified in the New York Stock Exchange. Information about us also is available at the
New York Stock Exchange. In accordance with U.S. securities laws, the SEC has
granted Viacom International relief from its obligations to file annual,
quarterly and current reports, proxy statements and other information with the
SEC. Accordingly, Viacom International does not file separate financial
statements with the SEC and does not independently publish its financial
statements. Viacom International's financial condition, results of operations
and cash flows are consolidated into the financial statements of Viacom.
We are "incorporating by reference" specified documents that we file
with the SEC, which means that we can disclose important information to you by
referring you to those documents that are considered part of this prospectus.
Later information that we file with the SEC will automatically update and
supersede this information. We incorporate by reference the documents listed
below and any future filings made with the SEC under Section 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 by us until the exchange offer is
completed.
o Our Registration Statement on Form S-4, dated November 24, 1999.
o OurCompany’s Annual Report on Form 10-K for the year ended December 31, 1999, as amended on April 28, 2000.
o Our Quarterly Reports on Form 10-Q for the quarters ended March
31, 2000, June 30, 2000 and September 30, 2000.
o Our Current Report on Form 8-K dated May 4, 2000, as amended on
July 17, 2000, and our Current Reports on Form 8-K dated August 3,
2000, August 15, 2000, October 31, 2000, November 3, 2000, January
5, 2001 and January 8, 2001.
o Our definitive Proxy Statement dated June 5, 2000.
o CBS Annual Report on Form 10-K for the year ended December 31,
1999, as amended on April 28, 2000.
o The financial statements of Infinity Broadcasting Corporation, as
set forth in Item 8 to Infinity's Annual Report on Form 10-K for
the year ended December 31, 1999.
o The financial statements of Infinity Broadcasting Corporation, as
set forth in Item 1 to Infinity's Quarterly Report on Form 10-Q
for the quarter ended September 30, 2000.
o Our Registration Statement on Form S-4, dated November 22, 2000,
as amended by Form S-4/A dated December 7, 2000, by Form S-4/A
dated January 9, 2001 and by Form S-4/A dated January 12, 2001.
iii
You may obtain a copy of these filings at no cost, by writing or
telephoning us at the following address:
Viacom Inc.
1515 Broadway
52nd Floor
New York, New York 10036
Attn: Investor Relations
Phone Number: (212) 258-6000
In addition, copies of all documents that we incorporated into this
prospectus by reference may be obtained free of charge at the offices of
Kredietbank S.A. Luxembourgeoise, 43, Boulevard Royal, L-2955 Luxembourg, our
Luxembourg paying and transfer agent.
iv
PROSPECTUS SUMMARY
The following summary highlights selected information from this
prospectus and does not contain all of the information that you should consider
before participating in this exchange offer. You should read the entire
prospectus, accompanying letter of transmittal and documents2017 incorporated by reference carefully.herein and (iii) the current directors and executive officers of the Company as a group. Each person has sole voting and investment power over the shares reported, except as noted. Also set forth below is information concerning the beneficial ownership by each person, or group of affiliated persons, who is known by the Company to beneficially own more than 5% of the Company’s Class A Common Stock. As of September 30, 2018, there were 37,507,609 shares of the Company’s Class A Common Stock outstanding and 337,358,037 shares of the Company’s Class B Common Stock outstanding.
| Beneficial Ownership of Equity Securities | ||||||||||||
| Name | Title of Security | Number of Shares | Percent of Class | |||||||||
Anthony G. Ambrosio | Class A Common | 0 | 0 | |||||||||
| Class B Common | 439,430 | (1)(2)(3) | * | |||||||||
Candace K. Beinecke | Class A Common | 0 | 0 | |||||||||
| Class B Common | 0 | 0 | ||||||||||
Barbara M. Byrne | Class A Common | 0 | 0 | |||||||||
| Class B Common | 1,639 | (3) | * | |||||||||
Gary L. Countryman | Class A Common | 6,697 | (4) | * | ||||||||
| Class B Common | 81,028 | (1)(4) | * | |||||||||
Brian Goldner | Class A Common | 0 | 0 | |||||||||
| Class B Common | 0 | 0 | ||||||||||
Linda M. Griego | Class A Common | 0 | 0 | |||||||||
| Class B Common | 47,435 | (3)(4) | * | |||||||||
Joseph R. Ianniello | Class A Common | 0 | 0 | |||||||||
| Class B Common | 1,212,330 | (1)(2)(3) | * | |||||||||
Robert N. Klieger | Class A Common | 889 | (4) | * | ||||||||
| Class B Common | 2,448 | (4) | * | |||||||||
Martha L. Minow | Class A Common | 2,298 | (4) | * | ||||||||
| Class B Common | 4,512 | (4) | * | |||||||||
Leslie Moonves | Class A Common | 0 | 0 | |||||||||
| Class B Common | 2,888,764 | (1)(2)(3) | * | |||||||||
Shari Redstone | Class A Common | 15,018 | (4)(5) | * | ||||||||
| Class B Common | 114,796 | (3)(4)(5) | * | |||||||||
Susan Schuman | Class A Common | 0 | 0 | |||||||||
| Class B Common | 0 | 0 | ||||||||||
Gil Schwartz | Class A Common | 0 | 0 | |||||||||
| Class B Common | 86,026 | (1)(2) | * | |||||||||
Lawrence P. Tu | Class A Common | 0 | 0 | |||||||||
| Class B Common | 192,210 | (1)(2) | * | |||||||||
Strauss Zelnick | Class A Common | 0 | 0 | |||||||||
| Class B Common | 0 | 0 | ||||||||||
Current directors and executive officers as a group (16 persons) | Class A Common | 24,902 | (4)(5) | * | ||||||||
| Class B Common | 1,884,720 | (1)(2)(3) (4)(5)(6)(7) | * | |||||||||
National Amusements, Inc. | Class A Common | 29,882,599 | (8) | 79.7 | % | |||||||
846 University Avenue Norwood, MA 02062 | Class B Common | 9,243,800 | (8) | 2.7 | % | |||||||
| Beneficial Ownership of Equity Securities | ||||||||||||||||
| Name | Title of Security | Number of Shares | Percent of Class | |||||||||||||
Mario J. Gabelliet al.(9) | Class A Common | 3,398,568 | 9.1% | |||||||||||||
GAMCO Investors, Inc. One Corporate Center Rye, NY 10580-1435 | ||||||||||||||||
Gruss Capital Management LPet al.(10) | Class A Common | 2,480,000 | 6.6% | |||||||||||||
Gruss Capital Management LP 510 Madison Avenue, 16th Floor New York, NY 10022 | ||||||||||||||||
| * | Represents less than 1% of the outstanding shares of the class. |
| (1) | Includes the following shares of the Company’s Class B Common Stock which the indicated named executive officer or director had the right to acquire on or within 60 days from September 30, 2018, through the exercise of stock options: Ambrosio, 233,353; Countryman, 15,279; Ianniello, 859,686; Moonves, 1,681,273; Schwartz, 64,444; and Tu, 192,020. |
| (2) | Includes shares held through the CBS 401(k) Plan. |
| (3) | Includes the following number of shares of the Company’s Class B Common Stock (a) owned by family members but as to which, except in the case of Ms. Griego, the indicated person disclaims beneficial ownership: Griego, 6,000; Ianniello, 2,416; and Moonves, 4,746; (b) held by trusts, as to which the indicated director has shared voting and investment power: Moonves, 146,292; and Shari Redstone, 1,500; (c) held in family trusts, as to which the indicated person has sole voting and investment power: Ambrosio, 94,366; Byrne, 864; and Moonves, 278,090; and (d) held in family trusts, as to which the indicated person’s family member has voting and investment power: Ambrosio, 36,858. |
| (4) | Includes (a) the following Company Class A Common Stock phantom units and Class B Common Stock phantom units credited pursuant to the Company’s deferred compensation plans for outside directors: Countryman, 6,697 Class A and 6,708 Class B; Klieger, 889 Class A and 895 Class B; Minow, 2,298 Class A and 2,311 Class B; and Shari Redstone, 15,018 Class A and 15,197 Class B; and (b) the following shares of the Company’s Class B Common Stock underlying vested restricted stock units (“RSUs”) for which settlement has been deferred: Countryman, 57,104; Griego, 31,584; Klieger, 1,553; and Shari Redstone, 44,025. Pursuant to the governing plans, the phantom common stock units are payable in cash and the RSUs are payable in shares of the Company’s Class B Common Stock following termination of service as a director. |
| (5) | Ms. Redstone is a stockholder of National Amusements, Inc. (“National Amusements”) and has a minority indirect beneficial interest in the Company shares owned by National Amusements (and a wholly owned subsidiary). |
| (6) | Includes 1,160,647 shares of the Company’s Class B Common Stock which the current directors and executive officers as a group had the right to acquire on or within 60 days from September 30, 2018, through the exercise of stock options or through the vesting of RSUs. |
| (7) | Includes information for Christina Spade as of October 18, 2018, the date of her appointment as the Company’s Executive Vice President, Chief Financial Officer. |
| (8) | These shares are owned by National Amusements and a wholly owned subsidiary. Beneficial ownership may also be attributed to Sumner M. Redstone, Chairman Emeritus of the Company, as Mr. Redstone is the chairman of the board and the beneficial owner of a controlling interest in National Amusements. National Amusements is controlled by Mr. Redstone through the Sumner M. Redstone National Amusements Trust (the “SMR Trust”), which owns 80% of the voting interest of National Amusements, and such voting interest of National Amusements held by the SMR Trust is voted solely by Mr. Redstone until his incapacity |
| or death. The SMR Trust provides that in the event of Mr. Redstone’s death or incapacity, voting control of the National Amusements’ voting interest held by the SMR Trust will pass to seven trustees, who will include director Shari Redstone. No member of the Company’s management is a trustee of the SMR Trust. Based on information received from National Amusements, National Amusements has pledged to its lenders shares of the Company’s Class A Common Stock and Class B Common Stock owned directly or indirectly by National Amusements. The aggregate number of shares pledged by National Amusements represents approximately 4.5% of the total outstanding shares of the Company’s Class A Common Stock and the Company’s Class B Common Stock, on a combined basis. The amount of the Company’s Class A Common Stock which National Amusements directly or indirectly owns and which has not been pledged by National Amusements to its lenders represents approximately 59.7% of the Company’s total Class A Common Stock outstanding. Mr. Redstone also directly owns 40 shares of the Company’s Class A Common Stock and 202,493 shares of the Company’s Class B Common Stock that are not shown in the table. Including such shares, Mr. Redstone beneficially owns a total of 29,882,639 shares of the Company’s Class A Common Stock, or 79.7% of the class, and 9,446,293 shares of the Company’s Class B Common Stock, or 2.8% of the class. |
| (9) | The information concerning Mario J. Gabelliet al. is based upon a Schedule 13D/A filed with the SEC on November 20, 2017. In addition to Mr. Gabelli, each of the following entities that Mr. Gabelli directly or indirectly controls or for which he acts as chief investment officer is a reporting person on the Schedule 13D/A: Gabelli Funds, LLC (“Gabelli Funds”); GAMCO Asset Management, Inc. (“GAMCO”); Gabelli & Company Investment Advisers, Inc. (“GCIA”); Gabelli Foundation, Inc. (the “Foundation”); MJG-IV Limited Partnership (“MJG-IV”); GGCP, Inc. (“GGCP”); GAMCO Investors, Inc. (“GBL”); and Associated Capital Group, Inc. (“AC”). As reported in the Schedule 13D/A, as of November 17, 2017: Gabelli Funds beneficially owned 1,524,300 of the reported shares; GAMCO beneficially owned 1,842,226 of the reported shares; GCIA beneficially owned 11,200 of the reported shares; GGCP beneficially owned 5,000 of the reported shares; the Foundation beneficially owned 4,000 of the reported shares; MJG-IV beneficially owned 10,000 of the reported shares; and AC beneficially owned 842 of the reported shares. Mr. Gabelli is deemed to beneficially own 1,000 shares as well as the shares owned beneficially by each of the foregoing reporting persons. AC, GBL and GGCP are deemed to beneficially own the shares owned beneficially by each of the foregoing reporting persons other than Mr. Gabelli and the Foundation. Each of the reporting persons discloses that it has sole voting and investment power with respect to the shares it beneficially owns, except that: (a) GAMCO does not have voting power over 135,934 of the reported shares; (b) Gabelli Funds has sole vesting and investment power with respect to the shares of each fund for which Gabelli Funds provides advisory services (the “Funds”) so long as the aggregate voting interest of all joint filers does not exceed 25% of their total voting interest in the Company and, in that event, the proxy voting committee of each Fund will vote that Fund’s shares; (c) in other special circumstances, the proxy voting committee of each Fund may take and exercise in its sole discretion the entire voting power with respect to the shares held by such Fund; and (d) the power of Mr. Gabelli, AC, GBL and GGCP to vote and invest the shares is indirect with respect to shares beneficially owned directly by the other reporting persons. |
| (10) | The information concerning Gruss Capital Management LPet al. is based upon a Schedule 13G/A filed with the SEC on January 30, 2018. As reported in the Schedule 13G/A, as of December 31, 2017, each of the following reporting persons shared voting and investment power with respect to all of the reported shares: Gruss DV Master Fund, Ltd. (“GDVMF”); Gruss Capital Management LP (“Gruss LP”); Gruss Management, LLC (“Gruss”); and Sean Dany. The reporting persons disclose that Gruss LP serves as the investment manager to GDVMF, Gruss serves as the general partner to Gruss LP, and Sean Dany is the managing member and principal owner of Gruss. |
DESCRIPTION OF THE COMPANYEXCHANGE NOTES
The exchange notes will be issued under an indenture, dated as of November 16, 2017, among CBS Corporation, as issuer, CBS Operations, as guarantor, and Deutsche Bank Trust Company Americas, as trustee. We are a diversified entertainment company with operations in seven
segments: Cable Networks, Television, Entertainment, Video, Publishing, Onlinerefer to this indenture as the “indenture” and Infinity. The Cable Networks segment operates MTV: MUSIC TELEVISION(R),
SHOWTIME(R), NICKELODEON(R)/NICK AT NITE(R), VH1 MUSIC FIRST(R), TV LAND(R),
TNN: THE NATIONAL NETWORK (formerly, The Nashville Network) and COUNTRY MUSIC
TELEVISION, among other program services. The Television segment consists of
CBS(R) and UPN(R) television networks, our 39 broadcast television stations, and
production and distribution of television programming through PARAMOUNT
TELEVISION(R), VIACOM(R) PRODUCTIONS, SPELLING TELEVISION(R), BIG TICKET
TELEVISION(R) and CBS(R) ENTERPRISES (including KING WORLD(R) PRODUCTIONS). The
Entertainment segment produces and distributes theatrical motion pictures
through PARAMOUNT PICTURES(R), operates movie theater and music publishing
operations and, through PARAMOUNT PARKS(R), owns and operates five theme parks
and a themed attraction into the United States and Canada. The Video segment
consists of an approximately 82% equity interest in BLOCKBUSTER(R) INC., which
operates and franchises video stores worldwide, primarilytrustee under the BLOCKBUSTER(R) brand.indenture as the “trustee.” The remainder of Blockbuster's common stock was sold to
the public in August 1999. The Publishing segment publishes and distributes
consumer books and related multimedia products, under such imprints as SIMON &
SCHUSTER(R), POCKET BOOKS(R), SCRIBNER(R) and THE FREE PRESS. The Online segment
provides online music and children's destinations featuring entertainment,
information, community tools and e-commerce, through SonicNet.com and Internet
sites currently related to MTV: MUSIC TELEVISION(R), NICKELODEON/NICK AT
NITE(R), VH1 MUSIC FIRST(R) and COUNTRY MUSIC TELEVISION. The Online segment
also includes other Internet businesses, which consist primarily of the
operation of the Internet site CBS.com, and the investment in iWon.com. We also
have investments in other Internet based companies such as MarketWatch.com,
Inc., SportsLine.com, Inc. and Hollywood.com, Inc. The Infinity segment consists
of an approximately 64.2% equity interest in Infinity Broadcasting Corporation
which operates radio stations and outdoor advertising properties, including
INFINITY BROADCASTING(R), INFINITY OUTDOOR and TDI(R). As described in more
detail under "Recent Developments" below, we and Infinity have entered into a
merger agreement under which we will acquire the approximately 35.8% equity
interest in Infinity that we do not currently own. On January 23, 2001, we
acquired the Black Entertainment Television cable network pursuant to an
agreement with BET Holding II, Inc. We were incorporated in 1986 under the laws
of the State of Delaware. Our principal offices are located at 1515 Broadway,
New York, New York 10036 and our telephone number is (212) 258-6000.
THE GUARANTOR
Viacom International, the guarantor of the senior securities, was
incorporated under the laws of the State of Delaware on May 19, 1995 and has its
corporate headquarters at 1515 Broadway, New York, New York 10036. Viacom
International has 100 shares of common stock outstanding, all of which are held
by Viacom. The operating assets of Viacom International and its subsidiaries
include MTV: MUSIC TELEVISION(R), SHOWTIME(R), NICKELODEON(R)/NICK AT NITE, VH1
MUSIC FIRST(R), TV LAND(R), approximately 18 broadcast television stations,
BLOCKBUSTER INC., publishing imprints
1
such as SIMON & SCHUSTER(R) and THE FREE PRESS, the businesses of Paramount and
certain related Internet sites. In accordance with U.S. securities laws, the SEC
has granted Viacom International relief from its obligations to file annual,
quarterly and current reports, proxy statements and other information with the
SEC. Accordingly, Viacom International does not file separate financial
statements with the SEC and does not independently publish its financial
statements. Viacom International's financial condition, results of operations
and cash flows are consolidated into the financial statements of Viacom.
CERTAIN SUBSIDIARIES
Viacom has two subsidiaries which are subject to the reporting
requirements of the Exchange Act. These subsidiaries are Blockbuster Inc. and
Infinity Broadcasting Corporation.
Blockbuster, incorporated under the laws of the State of Delaware in
1989, has its corporate headquarters at 1201 Elm Street, Dallas, Texas 75270. As
of December 31, 2000, Blockbuster had 31,011,114 shares of Class A common stock
and 144,000,000 shares of Class B common stock outstanding. Blockbuster is a
retailer of rentable home videocassettes, DVDs and video games, and has stores
throughout the United States and in many other countries. Blockbuster operates
primarily under the Blockbuster brand name. Blockbuster's financial condition,
results of operations and cash flows are consolidated into the financial
statements of Viacom. We own an approximately 82% equity interest in
Blockbuster.
Infinity, incorporated under the laws of the State of Delaware in 1998,
has its corporate headquarters at 40 West 57th Street, New York, New York 10019.
As of December 31, 2000, Infinity had 390,913,206 shares of Class A common stock
and 700,000,000 shares of Class B common stock outstanding. Infinity operates
radio stations and outdoor advertising properties. Infinity's financial
condition, results of operations and cash flows are consolidated into the
financial statements of Viacom. We own an approximately 64.2% equity interest in
Infinity and have entered into an agreement to acquire the approximately 35.8%
equity interest that we do not currently own. See "Recent Developments."
RECENT DEVELOPMENTS
On May 4, 2000, CBS Corporation merged with and into Viacom. The total
purchase price of approximately $39.8 billion represents the issuance of
approximately 825.5 million shares of Viacom non-voting Class B common stock and
11,004 shares of Viacom Series C convertible preferred stock (which were
subsequently converted into shares of Viacom non-voting Class B common stock),
the estimated fair value of CBS stock options which were assumed by Viacom, and
estimated transaction costs. The merger was accounted for by the purchase method
of accounting and the purchase price was allocated to the tangible and
identifiable intangible assets acquired and liabilities assumed, according to
their respective fair values, with the excess purchase price being allocated to
goodwill. In addition, Viacom assumed approximately $3.7 billion of CBS debt.
On October 30, 2000, Viacom and Infinity entered into a merger
agreement under which Viacom will acquire all of the approximately 35.8% of the
issued and outstanding shares of Infinity common stock that it does not
currently own. Pursuant to the merger agreement, Viacom will exchange 0.592 of a
share of Viacom non-voting Class B common stock for each share of Infinity Class
A common stock. Viacom's Board of Directors and Infinity's Board of Directors
approved the merger agreement after approval by a special committee of
Infinity's independent directors. The special committee was advised by separate
legal and financial advisors. In light of a recent Delaware Chancery Court
decision unrelated to Viacom or Infinity which created uncertainty regarding the
vote required to approve the merger, Viacom and Infinity have decided to seek
the approval of Infinity's minority stockholders. A special
2
meeting of Infinity's stockholders will be held on February 21, 2001 to consider
the merger. Viacom expects the merger to be completed immediately following the
stockholders' meeting. As of December 31, 2000, there were approximately 390.9
million shares of Infinity Class A common stock outstanding held by shareholders
other than Viacom.
On January 23, 2001, Viacom acquired Black Entertainment Television for
approximately $2.3 billion of Viacom non-voting Class B common stock plus the
assumption of approximately $575 million of debt. The final exchange ratio was
based on the trading prices of Viacom non-voting Class B common stock during a
measurement period immediately before the closing of the transaction.
3
Summary of the Terms of the Exchange Offer
On January 17, 2001, we issued $400 million aggregate principal amount
of unregistered 6.40% senior notes due 2006, $500 million aggregate principal
amount of unregistered 7.70% senior notes due 2010 and $750 million aggregate
principal amount of unregistered 7.875% senior debentures due 2030. The
unregistered senior securities are unconditionally guaranteed as to payment of
principal and interest by Viacom International. On the same day, we and the
initial purchasers of the unregistered senior securities entered into a
registration rights agreement in which we agreed that you, as a holder of
unregistered senior securities, would be entitled to exchange your unregistered
senior securities for exchange senior securities registered under the Securities
Act but otherwise having substantially identical terms to the unregistered
senior securities. This exchange offer is intended to satisfy these rights.
After the exchange offer is completed, you will no longer be entitled to any
exchange or registration rights with respect to your senior securities. All of
the exchange senior securities will be our obligations and will be entitled to
the benefits of the indenture and supplemental indentures relating to the
unregistered senior securities. The exchange senior securities will also be
unconditionally guaranteed as to payment of principal and interest by Viacom
International. The form and terms of the exchange senior securities arenotes will be substantially identical in all material respects to the form and terms of unregistered senior
securities, except:
othe original notes, except that the exchange senior securities have beennotes are registered under the Securities Act and therefore,will bear a different CUSIP number from the original notes of the same series, and the transfer restrictions, registration rights and related additional interest terms applicable to the original notes will not apply to the exchange senior securitiesnotes. The exchange notes will contain no restrictive legends;
oevidence the same indebtedness as the original notes which they will replace. The original notes surrendered in exchange for the exchange senior securitiesnotes will be retired and canceled and may not be reissued. Accordingly, issuance of the exchange notes will not have registration rights;
and
oresult in any increase in our outstanding indebtedness or in the exchange senior securities will not have rights to additional
interest.
The Exchange Offer............ We are offering to exchange $1,000 principal
amount of:
o 6.40% senior notes due 2006 which have been
registered under the Securities Actobligations of 1933
for each $1,000 principal amount of our
unregistered 2006 senior notes. AsCBS Operations as guarantor of the datenotes.
The following summary of the prospectus, $400 million in
aggregate principal amount of unregistered
2006 senior notes are outstanding,
o 7.70% senior notes due 2010 which have been
registered under the Securities Act of 1933
for each $1,000 principal amount of our
unregistered 2010 senior notes. As of the
date of this prospectus, $500 million in
aggregate principal amount of unregistered
2010 senior notes are outstanding, and
o 7.875% senior debentures due 2030 which have
been registered under the Securities Act of
1933 for each $1,000 principal amount of our
unregistered 2030 senior debentures. As of
the date of this prospectus, $750 million in
aggregate principal amount of unregistered
2030 senior debentures are outstanding.
4
Expiration of Exchange Offer.. The exchange offer will expire at 5:00 p.m., New
York City time, on February , 2001, unless we
decide to extend the expiration date.
Resale of the Exchange
Senior Securities........... Based on interpretative letters of the SEC staff
to third parties unrelated to us, we believe
that you can resell and transfer the exchange
senior securities you receive pursuant to this
exchange offer, without compliance with the
registration and prospectus delivery provisions of the Securities Act, provided that:
o anyindenture and the exchange senior securitiesnotes does not purport to be receivedcomplete and is subject to, and qualified in its entirety by reference to, all of the provisions of the indenture, including definitions therein of certain terms. This summary may not contain all information that you may find useful. You should read the indenture and the forms of the exchange notes, copies of which are filed as exhibits to the registration statement of which this prospectus forms a part and are available from us upon request at our address set forth under the heading “Where You Can Find Additional Information.” Capitalized terms used and not defined in this summary have the meanings specified in the indenture.
In this summary, unless the context otherwise requires, the terms “CBS Corporation,” “we,” “us” and “our” refer solely to CBS Corporation and not its subsidiaries.
Although the 2023 exchange notes and the 2028 exchange notes are referred to as “exchange notes,” each will be acquired inissued as a separate series from one another. Accordingly, for purposes of this summary, references to the ordinary
course“exchange notes” refer to each series of your business;
o you areexchange notes separately, and not engaged in, do not intend to engage in or have any arrangement or
understandingthe 2023 exchange notes and the 2028 exchange notes on a combined basis unless otherwise stated.
The 2023 exchange notes will be treated as a single series under the indenture with any person to participate
in2023 original notes that remain outstanding, and the distribution of the unregistered
senior securities or2028 exchange senior
securities;
o you are not an "affiliate" (as defined in
Rule 405notes will be treated as a single series under the Securities Act) of Viacom
or Viacom International or, if you are such
an affiliate, you will complyindenture with any 2028 original notes that remain outstanding. Accordingly, unless the registration and prospectus delivery
requirements of the Securities Actcontext otherwise requires, any references in this summary to the
extent applicable;
o if you are a broker-dealer, you are not
engaged in, and do not intend to engage in,
the distributionseries of exchange senior
securities;
o if you are a broker-dealer, you will receive
exchange senior securities for your own
account in exchange for unregistered senior
securities that were acquired as a result of
market-making activities or other trading
activities and that you will deliver a
prospectus in connection with any resale of
such exchange senior securities; and
o you are not acting on behalf of any person
who could not truthfully make the foregoing
representations.
If you wish to accept the exchange offer, you
must represent to us that these conditions have
been met.
If our belief is inaccurate and you transfer any
exchange senior security without delivering a
prospectus meeting the requirements of the
Securities Act or without an exemption from
registration under the Securities Act, you may
incur
5
liability under the Securities Act. We do not
assume or indemnify you against such liability,
but we do not believe that any such liability
should exist.
Accrued Interest on the
Exchange Senior Securities
and Unregistered Senior
Securities.................. The exchange senior securities will accrue
interest from the date interest was last paid on
the unregistered senior securities. If no
interest was paid on your unregistered senior
securities, your exchange senior securities will
accrue interest from and including January 17,
2001. Interest will be paid on the exchange
senior securities semi-annually on January 30
and July 30 of each year, except that there will
be no January 30, 2001 interest payment date for
any exchange 2006 senior notes. Holders of
unregistered senior securities that are accepted
for exchangenotes will be deemed to include any such original notes of such series.
Ranking
The exchange notes:
will be unsecured obligations of CBS Corporation;
will rank equally in right of payment with all other unsecured and unsubordinated indebtedness of CBS Corporation from time to time outstanding; and
will be fully and unconditionally guaranteed by CBS Operations, which guarantee will rank equally in right of payment with all other unsecured and unsubordinated indebtedness of CBS Operations from time to time outstanding.
As of September 30, 2018, CBS Corporation had approximately $9.39 billion of long-term indebtedness outstanding, all of which will rank equally in right of payment with the exchange notes. As of September 30, 2018, our direct and indirect subsidiaries, other than CBS Operations, had approximately $92 million of indebtedness outstanding. CBS Operations is a wholly owned subsidiary of CBS Corporation with no long-term indebtedness outstanding as of September 30, 2018, other than its guarantees of the senior debt of CBS Corporation, all of which is fully and unconditionally guaranteed by CBS Operations. The direct and indirect subsidiaries of CBS Operations had approximately $16 million of long-term indebtedness outstanding as of September 30, 2018.
The exchange notes and the guarantees will be effectively subordinated to any secured indebtedness of CBS Corporation or CBS Operations, as the case may be, to the extent of the value of the assets securing such indebtedness. The indenture does not limit the amount of debt that CBS Corporation, CBS Operations or their respective subsidiaries may incur.
In addition, both CBS Corporation and CBS Operations conduct their operations through subsidiaries, which generate a substantial portion of their respective operating income and cash flow. As a result, distributions or advances from subsidiaries of CBS Corporation and CBS Operations are a major source of funds necessary to meet their respective debt service and other obligations. Contractual provisions, laws or regulations, as well as subsidiaries’ financial condition and operating requirements, may limit the ability of CBS Corporation or CBS Operations to obtain cash required to pay CBS Corporation’s debt service obligations, including payments on the exchange notes, or CBS Operations’ payment obligations under the guarantees. The exchange notes will be structurally subordinated to all obligations of CBS Corporation’s subsidiaries (other than CBS Operations), including claims with respect to trade payables. The guarantees will be structurally subordinated to all obligations of CBS Operations’ subsidiaries, including claims with respect to trade payables. This means that holders of the exchange notes will have waiveda junior position to the rightclaims of creditors of CBS Corporation’s subsidiaries (other than CBS Operations) on the assets and earnings of such subsidiaries. Holders of guarantees of CBS Operations will have a junior position to receivethe claims of creditors of CBS Operations’ subsidiaries on the assets and earnings of such subsidiaries and will have no claim by reason of such guarantees against CBS Corporation or any paymentsubsidiary of CBS Corporation that is not a subsidiary of CBS Operations.
Interest and Maturity
The exchange notes will be issued in respectminimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof.
The 2023 exchange notes will be limited to $400,000,000 aggregate principal amount as of the issue date, which aggregate principal amount may, without the consent of holders, be increased in the future on the same terms as to status, CUSIP number or otherwise as the 2023 exchange notes being offered hereby (see “—Further Issues” below).
The 2028 exchange noteswill be limited to $500,000,000 aggregate principal amount as of the issue date, which aggregate principal amount may, without the consent of holders, be increased in the future on the same terms as to status, CUSIP number or otherwise as the 2028 exchange notesbeing offered hereby (see “—Further Issues” below).
Each 2023 exchange notewill bear interest accruedat a rate of 2.900% per year. Each 2028 exchange notewill bear interest at a rate of 3.700% per year. Interest will be payable semi-annually in arrears on the exchange notes on June 1 and December 1 of each year, and will be computed on the basis of a360-day year of twelve30-day months. Interest on the exchange notes will accrue from and including November 16, 2017 (or from the date of the lastmost recent interest payment date that was made into which interest has been paid or duly provided for with respect ofto the unregistered senior securities until the
date of the issuance oforiginal notes or the exchange senior
securities. Consequently,notes) and will be paid to holders whoof record on the May 15 and November 15 immediately before the interest payment date.
The 2023 exchange their unregistered senior securitiesnotes will receivemature on June 1, 2023. The 2028 exchange notes will mature on June 1, 2028. On the same interest payments that they
would have received had they not accepted the
exchange offer.
Termination of the Exchange
Offer....................... We may terminate the exchange offer if we
determine that our ability to proceed with the
exchange offer could be materially impaired due
to any legal or governmental action, new law,
statute, rule or regulation or any
interpretation of the staff of the SEC of any
existing law, statute, rule or regulation. We do
not expect any of the foregoing conditions to
occur, although we cannot assure you that such
conditions will not occur. You will have certain
rights against our company under the
registration rights agreement should we fail to
consummate the exchange offer.
Procedures for Tendering
Unregistered Senior
Securities.................. If you wish to participate in the exchange
offer, you must transmit a properly completed
and signed letter of transmittal, and all other
documents required by the letter of transmittal,
to the exchange agent at the address set forth
in the letter of transmittal. These materials
must be received by the exchange agent before
5:00 p.m., New York City time, on February ,
2001, the expirationmaturity date of the exchange offer.
You must also provide:
o a confirmation of any book-entry transfer of
unregistered senior securities tendered
electronically intonotes, the exchange agent's
account with DTC, Euroclear or Clearstream.
You must comply with DTC, Euroclear or
Clearstream's respective standard operating
procedures for electronic
6
tenders, by which you will agree to be bound
in the letter of transmittal; or
o physical delivery of your unregistered senior
securities to the exchange agent's address as
set forth in the letter of transmittal.
The letter of transmittal must also contain the
representations you must make to us as described
under "The Exchange Offer--Procedures for
Tendering."
Special Procedures for
Beneficial Owners........ If your unregistered senior securities are held
through a broker, dealer, commercial bank, trust
company or other nominee and you wish to tender
such senior notes, you should contact such
entity promptly and instruct it to tender your
unregistered senior securities on your behalf.
Guaranteed Delivery
Procedures for Unregistered
Senior Securities........... If you cannot meet the expiration deadline, or
you cannot deliver your unregistered senior
securities, the letter of transmittal or any
other documentation or comply with the
applicable procedures under DTC, Euroclear or
Clearstream standard operating procedures for
electronic tenders on time, you may tender your
unregistered senior securities according to the
guaranteed delivery procedures set forth under
"The Exchange Offer - Guaranteed Delivery
Procedures."
Withdrawal Rights............. You may withdraw the tender of your unregistered
senior securities at any time prior to 5:00
p.m., New York City time, on February , 2001,
the expiration date.
Consequences of Failure to
Exchange.................... If you are eligible to participate in this
exchange offer and you do not tender your
unregistered senior securities as described in
this prospectus, you will not have any further
registration rights or exchange rights. In that
case, your unregistered senior securities will
continue to be subject to restrictions on
transfer. As a result of such restrictions and
the availability of exchange senior securities,
the unregistered senior securities are likely to
be much less liquid securities than before. The
unregistered senior securities will, following
consummation of the exchange offer, bear
interest at the same rate as the exchange senior
securities.
Certain U.S. Federal Income
Tax Consequences............ The exchange of the unregistered senior
securities for exchange senior securities
pursuant to the exchange offer will not be a
taxable exchange for United States federal
income tax purposes. We believe that you will
not recognize any taxable
7
gain or loss solely as a result of the exchange.
Use of Proceeds............... We will not receive any proceeds from the
issuance of exchange senior securities pursuant
to the exchange offer.
Exchange Agents for
Unregistered Senior
Securities.................. Citibank, N.A., the trustee under the indenture
for the unregistered senior securities, is
serving as the principal exchange agent in
connection with the exchange offer. Citibank can
be reached at 111 Wall Street, 5th Floor, New
York, New York 10005; its telephone number is
(800) 422-2066 and its facsimile number is (212)
825-3483. Kredietbank S.A. Luxembourgeoise, our
Luxembourg listing, paying and transfer agent,
will also act as Luxembourg exchange agent. In
its capacity as Luxembourg exchange agent,
Kredietbank will act solely as an intermediary
between holders of unregistered senior
securities wishing to accept the exchange offer
and the principal exchange agent. Kredietbank
will forward the tenders it receives to the
principal exchange agent. Kredietbank can be
reached at 43, Boulevard Royal, L-2955
Luxembourg; its telephone number is (352) 47 97
3933 and its facsimile number is (352) 47 97 73
951.
8
DESCRIPTION OF THE EXCHANGE SENIOR SECURITIES
The following summarized provisions are subject to a number of
important exceptions and qualifications, which are described under the heading
"Description of the Senior Securities" in this prospectus.
Exchange Senior
Securities.............. $400,000,000 principal amount of 6.40% senior notes
due 2006. $500,000,000 principal amount of 7.70%
senior notes due 2010. $750,000,000 principal amount
of 7.875% senior debentures due 2030.
Maturity Dates............ January 30, 2006 for the exchange 2006 senior notes.
July 30, 2010 for the exchange 2010 senior notes.
July 30, 2030 for the exchange senior debentures.
Interest Payment Dates.... January 30 and July 30 of each year, beginning on
the interest payment date immediately following the
last interest payment date for which interest was
paid on unregistered senior securities which were
exchanged pursuant to the exchange offer, except
that there will be no January 30, 2001 interest
payment date for any exchange 2006 notes.
Optional Redemption....... The exchange 2010 senior notes and the exchange
senior debentures are redeemable at our option, in
whole or in part, at any time. The redemption price
isentitled to receive 100% of the principal amount of the exchange senior
securities redeemed, plus accrued and unpaidnotes. The exchange notes do not provide for a sinking fund.
If any maturity date, redemption date or interest plus a make-whole premium basedpayment date falls on a discount rateSaturday, Sunday or day on which banking institutions in The City of 25 basis points, inNew York are authorized or obligated by law or executive order to close, then payment of principal and interest, if any, may be made on the casenext succeeding business day and no interest will accrue because of such delayed payment.
Principal and interest will be payable, and the exchange notes will be transferable, at the office of the paying agent. We may, however, pay interest by check mailed to registered holders of the exchange 2010 senior notes, and 35 basis points, innotes. At the casematurity of the exchange senior debentures, over an
appropriate treasury rate.
Covenants................. notes, the principal, together with accrued interest thereon, will be payable in immediately available funds upon surrender of such exchange notes at the office of the trustee.
The exchange notes will be subject in all cases to tax, fiscal and other law and regulations (and any administrative or judicial interpretation applicable thereto). We are not required to make any payment to a holder with respect to any tax, assessment or other governmental charge imposed (by withholding or otherwise) by any government or a political subdivision or taxing authority thereof or therein due and owing with respect to the exchange notes. See “U.S. Federal Income Tax Considerations” for additional information about the material federal income tax consequences of the ownership and disposition of exchange notes.
Further Issues
The indenture governingdoes not limit the exchangeamount of senior securities contains covenantsnotes that among other
things, limit our ability to:
o create certain liens;
o enter into certain sale and leaseback
transactions; and
o consolidate, merge or sell all or substantially
all of our assets.
Events of Default.........may be issued. The indenture provides that senior notes may be issued up to an aggregate principal amount authorized by CBS Corporation from time to time.
We may from time to time, without notice to or the consent of the holders of the exchange notes currently being offered, create and issue further senior notes ranking equally and ratably in all respects with such previously issued exchange notes, or in all respects except for eventsthe issue date, price to the public and payment of default,
subjectinterest accruing prior to applicable cure periods, including:
o we dothe issue date or except, in some circumstances, for the first payment of interest following the issue date of those further senior notes. Any such further senior notes will be consolidated with and form a single series with the exchange notes currently being offered and will have the same terms as to status, CUSIP number or otherwise as the exchange notes, provided that any such further senior notes that are not pay interest onfungible for U.S. federal income tax purposes with the exchange notes currently being offered will be issued with a different CUSIP number. Any such further senior security
within 30 daysnotes will be issued pursuant to a resolution of itsour board of directors (or a committee designated by the board), pursuant to a supplement to the indenture or under an officer’s certificate pursuant to the indenture.
Guarantees
On the issue date of the exchange notes, CBS Operations will unconditionally guarantee the due date;
o we do not payand punctual payment of the principal of (and premium, if any) and interest, if any, on the exchange notes when and as the same shall become due and payable, whether at maturity, upon redemption, upon acceleration or any premium on
a senior security on its due date;
o we remain in breach of a covenant or warranty in
respectotherwise. The guarantees of the indenture for 60 days after we
receive a written notice of default. The notice
mustexchange notes will be sent by either the trustee or holders of
at least
9
25% in principal amount of a series of
outstanding senior securities;
o we are in default under agreements under which we
have indebtedness outstanding in excess of $250
million in the aggregate and which indebtedness
is due either at maturity or has been declared
due prior to maturity and remains unpaid;
o we fail to pay a money judgment in excess of $250
million for a period of 60 days after it becomes
final and not subject to further appeal; or
o we or Viacom International file for bankruptcy,
or other specified events of bankruptcy,
insolvency or reorganization occur.
Trustee................... Citibank, N.A.
Listing................... Application has been made to listendorsed on the exchange senior securities on the Luxembourg Stock Exchange.
10
SELECTED FINANCIAL DATA FOR VIACOM
The selected financial data presented below have been derived from, and
should be read together with, our audited consolidated financial statements and
the accompanying notes included in our annual report on Form 10-K for the year
ended December 31, 1999 and the unaudited interim consolidated financial
statements and the accompanying notes included in our quarterly report on Form
10-Q for the quarter ended September 30, 2000, both of which are incorporated by
reference into this prospectus.
Nine Months
Ended September 30,
(Unaudited) Year Ended December 31,
2000(a) 1999 1999 1998 1997 1996 1995
------- ---- ---- ---- ---- ---- ----
(in millions, except per share amounts)
Statement of Operations Data:
Revenues ............................. $13,900 $9,286 $12,859 $12,096 $10,685 $9,684 $8,700
Depreciation.......................... 528 367 497 442 447 331 244
Amortization of intangibles .......... 932 249 348 336 325 323 316
Operating income...................... 722 881 1,247 752 685 1,197 1,247
Earnings (loss) from continuing
operations ........................ (394) 239 372 (44) 374 152 88
Net earnings (loss) .................. (847) 201 334 (122) 794 1,248 223
Net earnings (loss) attributable to
common stock ...................... (847) 189 322 (150) 734 1,188 163
Earnings (loss) per common share:
Basic:
Earnings (loss) from continuing
operations ................... $ (.35) $ .33 $ .52 $ (.10) $ .44 $ .13 $ .04
Net earnings (loss).............. $ (.75) $ .27 $ .46 $ (.21) $ 1.04 $ 1.63 $ .22
Diluted:
Earnings (loss) from continuing
operations ................... $ (.35) $ .32 $ .51 $ (.10) $ .44 $ .13 $ .04
Net earnings (loss) ............. $ (.75) $ .27 $ .45 $ (.21) $ 1.04 $ 1.62 $ .22
Weighted average shares outstanding:
Basic............................ 1,134 695 695 709 706 728 725
Diluted.......................... 1,134 709 710 709 709 735 750
Other Data:
EBITDA (b)............................ $ 2,182 $1,497 $ 2,092 $ 1,530 $ 1,457 $1,851 $1,807
At September 30,
2000 (a) At December 31,
(Unaudited) 1999 1998 1997 1996 1995
----------- ---- ---- ---- ---- ----
(in millions)
Balance Sheet Data:
Cash and cash equivalents............ $ 993 $ 681 $ 767 $ 292 $ 209 $ 464
Intangibles, net..................... 61,643 11,479 11,557 14,700 14,894 16,153
Total assets......................... 82,423 24,486 23,613 28,289 28,834 28,991
Long-term debt, net of current
portion ........................... 12,639 5,698 3,813 7,423 9,856 10,712
Stockholders' equity ................ 48,195 11,132 12,050 13,384 12,587 12,094
(a) Includes financial information for CBS Corporation from May 4, 2000, the
date of its merger with and into Viacom. Accordingly, operating results and
financial position are not necessarily comparable on a year-to-year basis.
(b) We define EBITDA as operating income before depreciation and amortization,
principally of goodwill related to business combinations. While many in the
financial community consider EBITDA to be an important measure of
comparative operating performance, you should consider it in addition to,
but not as a substitute for or superior to, operating income, net earnings,
cash flow and other measures of financial performance prepared in
accordance with generally accepted accounting principles.
11
SELECTED FINANCIAL DATA FOR CBS
The merger of CBS Corporation with and into Viacom was completed on May
4, 2000. Accordingly, relevant financial information for CBS is not reflected in
our historical financial statements for the periods set forth below. The
selected financial data presented below have been derived from, and should be
read together with, the audited consolidated financial statements of CBS and the
accompanying notes included in CBS' Annual Report on Form 10-K for the year
ended December 31, 1999 and the unaudited interim consolidated financial
statements and the accompanying notes for the quarter ended March 31, 2000
included in our Current Report on Form 8-K dated May 4, 2000, as amended on July
17, 2000, each of which is incorporated by reference into this prospectus.
Three Months
Ended March 31,
(Unaudited) Year Ended December 31,
2000 1999(a) 1999(a) 1998(a) 1997(a) 1996(a) 1995(a)
------- -------- -------- -------- -------- -------- --------
(in millions, except per share amounts)
Statement of Operations Data:
Revenues ............................. $2,406 $1,769 $7,373 $6,805 $5,367 $4,143 $1,074
Depreciation.......................... 69 33 148 137 120 105 32
Amortization of intangibles .......... 228 116 521 434 325 174 25
Operating income...................... 222 123 956 482 253 54 160
Net earnings (loss) .................. (38) 387 780 (21) 549 95 (10)
Net earnings (loss) per common share:
Basic:........................... $ (.05) $ .56 $ 1.10 $ (.03) $ .84 $ .12 $ (.25)
Diluted:......................... $ (.05) $ .55 $ 1.08 $ (.03) .84 $ .12 $ (.25)
Weighted average shares outstanding:
Basic............................ 752 693 702 696 629 401 370
Diluted.......................... 752 708 721 696 629 401 370
Other Data:
EBITDA (unaudited)(b)................. $ 519 $ 272 $ 1,625 $ 1,053 $ 698 $ 333 $ 217
At March 31,
2001 At December 31,
-------------------------------------------------------
(Unaudited) 1999(a) 1998(a) 1997(a) 1996(a) 1995(a)
----------- ------- ------- ------- ------- -------
(in millions)
Balance Sheet Data:
Cash and cash equivalents (c)........ $ 381 $ 249 $ 825 $ 67 $ 233 $ 226
Total assets(c)..................... 33,093 33,738 22,058 20,604 21,116 18,548
Intangibles, net..................... 24,548 24,917 15,463 12,727 11,320 6,638
Long-term debt, net of current
portion (c) ....................... 4,072 4,158 2,888 3,676 5,566 7,383
Stockholders' equity ................ 15,790 16,147 9,054 8,080 5,731 1,453
(a) Includes financial information for the following acquired entities from
their respective dates of acquistion: the outdoor advertising operations of
Outdoor Systems, Inc. as of December 7, 1999; King World Productions, Inc.
on November 15, 1999; the radio operations of American Radio on June 4,
1998; The Nashville Network and the remaining interest of Country Music
Television on September 30, 1997; Infinity Media Corporation on December
31, 1996; and CBS Inc. on November 24, 1995. Accordingly, operating results
are not necessarily comparable on a year-to-year basis.
(b) We define EBITDA as operating income before depreciation and amortization,
principally of goodwill related to business combinations. While many in the
financial community consider EBITDA to be an important measure of
comparative operating performance, you should consider it in addition to,
but not as a substitute for or superior to, operating income, net earnings,
cash flow and other measures of financial performance prepared in
accordance with generally accepted accounting principles.
(c) Financial information for all periods presented includes amounts for both
continuing and discontinued operations.
12
SUMMARY UNAUDITED PRO FORMA COMBINED FINANCIAL INFORMATION
The following summary unaudited pro forma combined financial
information is based upon the historical financial statements of Viacom,
adjusted for the Viacom/CBS merger, certain other transactions and the
contemplated Viacom/Infinity merger. The unaudited pro forma combined condensed
statement of operations data for the nine months ended September 30, 2000 and
the year ended December 31, 1999 is presented as if the Viacom/CBS merger,
certain other transactions and the contemplated Viacom/Infinity merger had
occurred on January 1, 1999. The unaudited pro forma combined balance sheet data
at September 30, 2000 is presented as if the Viacom/Infinity merger had occurred
on September 30, 2000.
The summary unaudited pro forma combined condensed financial data is
for illustrative purposes only and does not necessarily indicate the operating
results or financial position that would have been achieved had the Viacom/CBS
merger, certain other transactions and the contemplated Viacom/Infinity merger
been completed as of the dates indicated or of the results that may be obtained
in the future. In addition, the data does not reflect synergies that might be
achieved from combining these operations.
Unaudited Pro Forma Combined Statement of Operations Data
Viacom/CBS Merger and
Viacom/CBS Merger Viacom/Infinity Merger
Nine Months Ended Year Ended Nine Months Ended Year Ended
September 30, 2000 December 31, 1999 September 30, 2000 December 31, 1999
(in millions, except per share amounts)
Statement of Operations Data:
Revenues ............................. $17,354 $22,157 $17,354 $22,157
Operating income...................... 863 1,513 707 1,304
Earnings (loss) from continuing
operations before income taxes ... 140 670 (16) 461
Loss from continuing operations....... (643) (284) (702) (435)
Loss from continuing operations
attributable to common stock ..... (643) (297) (702) (448)
Basic and diluted loss from
continuing operations per share.... $ (.43) $ (.20) $ (.40) $ (.26)
Basic and diluted weighted average
shares outstanding................. 1,508 1,506 1,739 1,737
Other Data:
EBITDA (a) ........................... $ 2,954 $ 4,209 $ 2,943 $ 4,194
Unaudited Pro Forma Combined Balance Sheet Data
(in millions)
Viacom/Infinity Merger
At September 30,
2000
----
Cash and cash equivalents.................................. $ 993
Total assets .............................................. 90,181
Long-term debt, net of current portion .................... 12,639
Stockholders' equity....................................... 61,605
(a) We define EBITDA as operating income before depreciation and amortization,
principally of goodwill related to business combinations. While many in the
financial community consider EBITDA to be an important measure of
comparative operating performance, you should consider it in addition to,
but not as a substitute for or superior to, operating income, net earnings,
cash flow and other measures of financial performance prepared in
accordance with generally accepted accounting principles.
13
RATIO OF EARNINGS TO FIXED CHARGES
(Unaudited)
The ratio of earnings to fixed charges for Viacom are set forth below,
on a pro forma basis, for the nine months ended September 30, 2000 and the year
ended December 31, 1999 to give effect to the Viacom/CBS merger, certain other
transactions and the contemplated Viacom/Infinity merger, as if the mergers each
occurred on January 1, 1999, and on a historical basis for the nine months ended
September 30, 2000 and for each year in the five-year period ended December 31,
1999.
For purposes of computing the following ratios, earnings represents
income from continuing operations before fixed charges and taxes. Fixed charges
represent interest expense, amortization of capitalized interest and such
portion of rental expense which represents an appropriate interest factor.
Nine Months Year Ended December 31,
Ended ---------------------------------------------------------------
September 30, 2000 1999 Viacom Historical
----------------------------------------------- ------------------------------- ------------------------------
Pro Forma for Pro Forma for
Viacom/CBS Viacom/CBS
Pro Forma for Merger and Pro Forma for Merger and
Viacom Viacom/CBS Viacom/Infinity Viacom/CBS Viacom/Infinity
Historical Merger Merger Merger Merger 1999 1998 1997 1996 1995
---------- ------ ------ ------ ------ ---- ---- ---- ---- ----
Ratio of
Earnings to
Fixed Charges.... 1.3x 1.2x 1.0x 1.5x 1.4x 2.2x 1.1x 2.0x 1.4x 1.5x
14
RISK FACTORS
An investment in the exchange senior securities is subject to numerous
risks, including, but not limited to those set forth below. In addition to the
information contained elsewhere in this prospectus, you should carefully
consider the following risk factors before deciding to exchange your
unregistered senior securities for exchange senior securities.
Fraudulent Conveyance Considerations
Our obligations under the exchange senior securities will be guaranteed
to the extent described in this prospectus by Viacom International. See
"Description of Senior Securities--Guarantees." notes.
Various federal and state fraudulent conveyance laws have been enacted for the protection of creditors and may be utilized by a court of competent jurisdiction to subordinate or avoid all or part of any guarantee issued by Viacom International.
To the extent that a court were to find that (x) a guarantee was
incurred by Viacom International with the intent to hinder, delay or defraud any
present or future creditor or (y) Viacom International did not receive fair
consideration or reasonably equivalent value for issuing its guarantee and
Viacom International (i) was insolvent or rendered insolvent by reason for the
issuance of the guarantee, (ii) was engaged or about to engage in a business or
transaction for which the remaining assets of Viacom International constituted
unreasonably small capital to carry on its business or (iii) intended to incur,
or believed that it would incur, debts beyond its ability to pay such debts as
they matured, the court could subordinate or avoid all or part of such guarantee
in favor of Viacom International's other creditors. To the extent any guarantee
issued by Viacom International was voided as a fraudulent conveyance or held
unenforceable for any other reason, the holders of exchange senior securities
guaranteed by Viacom International could cease to have any claim against Viacom
International and would be creditors solely of Viacom.
We and Viacom International believe that the issuances of the
guarantees by Viacom International are not fraudulent conveyances. There can be
no assurance, however, that a court passing on such questions would reach the
same conclusions. In rendering their opinions on the validity of the exchange
senior securities and, if applicable, the related guarantees, neither our
counsel nor counsel for Viacom International will express any opinion as to
federal or state laws relating to fraudulent transfers.
USE OF PROCEEDS
We will not receive any proceeds from the exchange offer. In
consideration for issuing the exchange senior securities contemplated by this
prospectus, we will receive unregistered senior securities from you in like
principal amount.CBS Operations. The unregistered senior securities surrendered in exchange for
the exchange senior securities will be retired and canceled and cannot be
reissued. Accordingly, issuance of the exchange senior securities will not
result in any change in our indebtedness.
15
CAPITALIZATION
The following table sets forth our capitalization as of September 30,
2000 on a historical basis, as reported by Viacom and on a pro forma basis to
reflect the contemplated Viacom/Infinity merger, the issuance and sale of the
senior securities and the repayment of notes payable to banks from the proceeds
of the issuance and sale of the senior securities.
At September 30, 2000(1)
(Unaudited)
---------------
Pro Forma for
Viacom/Infinity
Viacom Merger and
Historical this Offering
---------- -------------
(in millions, except per share
amounts)
Long-term debt:
Continuing operations:
Notes payable to banks (including commercial paper)........................ $ 6,046 $ 4,342
Senior notes and debentures (5.875%-9.75%, due 2000-2023).................. 3,879 3,879
Senior subordinated notes (8.875%-10.25%, due 2001-2007)................... 705 705
Subordinated exchange debentures (11.375%, due 2009)....................... 45 45
Obligations under capital leases........................................... 553 553
6.40% Senior notes due 2006................................................ -- 399
7.70% Senior notes due 2010................................................ 1,149 1,679
7.875% Senior debentures due 2030.......................................... 500 1,285
------- -------
Total debt............................................................. 12,877 12,887
------- -------
Stockholders' equity:
Class A common stock, par value $.01 per share; 500 shares authorized; 139
shares issued ................................................................. 1 1
Class B common stock, par value $.01 per share; 3,000 shares authorized; 1,454
shares issued, and 1,685 shares on a pro forma basis for the Infinity Merger. 15 17
Additional paid-in capital...................................................... 49,975 63,383
Retained earnings .............................................................. 1,401 1,401
Accumulated other comprehensive loss............................................ (126) (126)
Less: Treasury stock .......................................................... (3,071) (3,071)
--------- --------
Total stockholders' equity............................................. 48,195 61,605
-------- --------
Total capitalization................................................... $61,072 $74,492
======= =======
- --------------
(1) Except as set forth above and except as otherwise disclosed in any documents
incorporated herein by reference, there has been no material change in the total
capitalization of Viacom since September 30, 2000.
16
THE EXCHANGE OFFER
Purpose and Effect of Exchange Offer; Registration Rights
We sold the unregistered senior securities to Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Salomon Smith Barney Inc., as representatives of
the initial purchasers, on January 17, 2001. The initial purchasers then resold
the unregistered senior securities under an offering memorandum dated January 9,
2001 in reliance on Rule 144A and Regulation S under the Securities Act. On
January 17, 2001, we entered into a registration rights agreement with the
initial purchasers. Under the registration rights agreement, we agreed:
o to file with the SEC a registration statement relating to the exchange
offer under the Securities Act no later than March 18, 2001;
o to use our reasonable best efforts to cause the exchange offer
registration statement to be declared effective under the Securities
Act on or before July 16, 2001; and
o to use our reasonable best efforts to cause the exchange offer to be
consummated not later than 45 days following the date of effectiveness
of the exchange offer registration statement.
If you participate in the exchange offer, you will, with limited
exceptions, receive senior securities that are freely tradable and not subject
to restrictions on transfer. You should read the information in this prospectus
under the heading "Resales of Exchange Senior Securities" for more information
relating to your ability to transfer exchange senior securities.
If you wish to exchange unregistered senior securities for exchange
senior securities in the exchange offer, you will be required to make certain
representations in the letter of transmittal. These include representations
that:
o any exchange senior securities to be received by you will be acquired
in the ordinary course of your business;
o you are not engaged in, do not intend to engage in or have any
arrangement or understanding with any person to participate in the
distribution of the unregistered senior securities or exchange senior
securities;
o you are not an "affiliate" (as defined in Rule 405 under the
Securities Act) of Viacom or Viacom International or, if you are such
an affiliate, you will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent applicable;
o if you are a broker-dealer, you are not engaged in, and do not intend
to engage in, the distribution of exchange senior securities;
o if you are a broker-dealer, you will receive exchange senior
securities for your own account in exchange for unregistered senior
securities that were acquired as a result of market-making activities
or other trading activities and that you will deliver a prospectus in
connection with any resale of such exchange senior securities; and
17
o you are not acting on behalf of any person who could not truthfully
make the foregoing representations.
The exchange offer is not being made to, nor will we accept tenders for
exchange from, holders of unregistered senior securities in any jurisdiction in
which the exchange offer or the acceptance of the exchange offer would not be in
compliance with the securities laws or blue sky laws of such jurisdiction.
If you are eligible to participate in the exchange offer and do not
tender your unregistered senior securities, you will hold the untendered
unregistered senior securities which will continue to be subject to restrictions
on transfer under the Securities Act.
Shelf Registration
In the registration rights agreement, we agreed to file a shelf
registration statement only if:
o after January 17, 2001, there is a change in law or applicable
interpretations of the law by the staff of the SEC, and as a result we
are not permitted to complete the exchange offer as contemplated by
the registration rights agreement;
o any holder of unregistered senior securities is not able to
participate in the exchange offer;
o any holder of unregistered senior securities does not receive fully
transferable exchange senior securities;
o the exchange offer registration statement is not declared effective by
July 16, 2001 or the exchange offer is not consummated within 45 days
after the exchange offer registration statement is declared effective,
although we may terminate such shelf registration statement at any
time, without penalty, if the exchange offer registration statement is
declared effective or the exchange offer is consummated; or
o upon the request of any of the initial purchasers made within 90 days
after the consummation of the exchange offer with respect to
unregistered senior securities not eligible to be exchanged in the
exchange offer and held by it following the consummation of the
exchange offer.
The shelf registration statement will permit only certain holders to
resell their unregistered senior securities from time to time. In addition, such
holders must:
o provide specified information in connection with the shelf
registration statement; and
o agree in writing to be bound by all provisions of the registration
rights agreement (including the applicable indemnification
obligations).
A holder who sells unregistered senior securities pursuant to the shelf
registration statement will be required to be named as a selling securityholder
in the prospectus and to deliver a copy of the prospectus to purchasers. If we
are required to file a shelf registration statement, we will provide to each
holder of unregistered senior securities copies of the prospectus that is a part
of the shelf registration statement and notify each such holder when the shelf
registration statement becomes effective. Such holder will be subject to certain
of the civil liability provisions under the Securities Act in connection with
such sales, and will be bound by the provisions of the registration rights
agreement which are applicable to such a holder (including the applicable
indemnification obligations).
18
If a shelf registration statement is required, we will use our
reasonable best efforts to:
o file the shelf registration statement with the SEC no later than (a)
August 15, 2001 or (b) the 60th day after such filing obligation
arises, whichever is later;
o use our reasonable efforts to cause the shelf registration statement
to be declared effective by the SEC no later than September 14, 2001;
and
o use our reasonable efforts to keep the shelf registration statement
effective until January 17, 2003, or if earlier until all of the
unregistered senior securities covered by the shelf registration
statement are sold thereunder or are already freely tradable.
During any 365-day period, we will have the ability to suspend the
availability of the shelf registration statement for up to 4 periods of up to 45
consecutive days (except for the consecutive 45-day period immediately prior to
the maturity of the notes), but no more than an aggregate of 90 days during any
365-day period, if our board of directors determines in good faith that there is
a valid purpose for the suspension.
Additional Interest
If a registration default (as defined below) occurs, we will be
required to pay additional interest to each holder of unregistered senior
securities. During the first 90-day period that a registration default occurs,
we will pay additional interest equal to 0.25% per annum. At the beginning of
the second and any subsequent 90-day period that a registration default is
continuing, the amount of additional interest will increase by an additional
0.25% per annum until all registration defaults have been cured. However, in no
event will the rate of additional interest exceed 0.50% per annum. Such
additional interest will accrue only for those days that a registration default
occurs and is continuing. All accrued additional interest will be paid to the
holders of the unregistered senior securities in the same manner as interest
payments on the unregistered senior securities are made, with payments being
made on the interest payment dates for the senior securities. Following the cure
of all registration defaults, no more additional interest will accrue. You will
not be entitled to receive any additional interest if you were, at any time
while the exchange offer was pending, eligible to exchange, and did not validly
tender, your unregistered senior securities for exchange senior securities in
the exchange offer.
A "registration default" includes any of the following:
o we fail to file any of the registration statements required by the
registration rights agreement on or before March 18, 2001;
o any of such registration statements is not declared effective by the
SEC on or before July 16, 2001;
o we fail to complete the exchange offer no later than 45 days following
the date of effectiveness of the exchange offer registration
statement; or
o the shelf registration statement or the exchange offer registration
statement is declared effective but thereafter ceases to be effective
or usable in connection with resales of the senior securities during
the period specified in the registration rights agreement, subject to
certain exceptions for limited periods of time with respect to the
shelf registration statement.
19
The exchange offer is intended to satisfy our exchange offer
obligations under the registration rights agreement. The above summary of the
registration rights agreement is not complete and is subject to, and qualified
by reference to, all the provisions of the registration rights agreement. A copy
of the registration rights agreement is filed as an exhibit to the registration
statement that includes this prospectus.
Terms of the Exchange Offer
Upon the terms and subject to the conditions set forth in this
prospectus and in the accompanying letter of transmittal, we are offering to
exchange $1,000 principal amount of exchange senior securities for each $1,000
principal amount of unregistered senior securities. You may tender some or all
of your unregistered senior securities only in integral multiples of $1,000. As
of the date of this prospectus, $400 million aggregate principal amount of the
unregistered 2006 senior notes, $500 million aggregate principal amount of the
unregistered 2010 senior notes and $750 million aggregate principal amount of
the unregistered senior debentures are outstanding.
The terms of the exchange senior securities to be issued are
substantially similar to the unregistered senior securities, except that the
exchange senior securities have been registered under the Securities Act and,
therefore, the certificates for the exchange senior securities will not bear
legends restricting their transfer. The exchange senior securities will be
issued under and be entitled to the benefits of the Indenture, dated as of May
15, 1995, among us, our wholly owned subsidiary, Viacom International, as
guarantor, and Citibank, N.A., as successor to State Street Bank and Trust
Company and The First National Bank of Boston, Trustee. The Indenture was
supplemented by the First Supplemental Indenture, dated as of May 24, 1995, was
supplemented and amended by the Second Supplemental Indenture and Amendment No.
1, dated as of December 15, 1995, was supplemented by the Third Supplemental
Indenture, dated as of July 22, 1996, was supplemented by the Fourth
Supplemental Indenture, dated as of August 1, 2000, and, in connection with the
unregistered senior securities, was supplemented by a Fifth Supplemental
Indenture, dated January 17, 2001. We refer to the Indenture, as so supplemented
and amended, as the "Indenture."
In connection with the issuance of the unregistered senior securities,
we arranged for the unregistered senior securities to be issued and transferable
in book-entry form through the facilities of Euroclear, Clearstream Luxembourg
and DTC, acting as a depositary. The exchange senior securities will also be
issuable and transferable in book-entry form through Euroclear, Clearstream
Luxembourg and DTC.
There will be no fixed record date for determining the eligible holders
of the unregistered senior securities that are entitled to participate in the
exchange offer. We will be deemed to have accepted for exchange validly tendered
unregistered senior securities when and if we have given oral (promptly
confirmed in writing) or written notice of acceptance to the exchange agent. The
exchange agent will act as agent for the tendering holders of unregistered
senior securities for the purpose of receiving exchange senior securities from
us and delivering them to such holders.
If any tendered unregistered senior securities are not accepted for
exchange because of an invalid tender or the occurrence of certain other events
described herein, certificates for any such unaccepted unregistered senior
securities will be returned, without expenses, to the tendering holder thereof
as promptly as practicable after the expiration of the exchange offer.
Holders of unregistered senior securities who tender in the exchange
offer will not be required to pay brokerage commissions or fees or, subject to
the instructions in the letter of transmittal, transfer taxes
20
with respect to the exchange of unregistered senior securities for exchange
senior securities pursuant to the exchange offer. We will pay all charges and
expenses, other than certain applicable taxes, in connection with the exchange
offer. It is important that you read the section "Fees and Expenses" below for
more details regarding fees and expenses incurred in the exchange offer.
If we successfully complete this exchange offer, any unregistered
senior securities which holders do not tender or which we do not accept in the
exchange offer will remain outstanding and continue to accrue interest, but the
holders of unregistered senior securities after the exchange offer in general
will not have further rights under the registration rights agreement and we will
not have any further obligation to register the unregistered senior securities
under the Securities Act. In that case, holders wishing to transfer unregistered
senior securities would have to rely on exemptions from the registration
requirements of the Securities Act.
Conditions of the Exchange Offer
You must tender your unregistered senior securities in accordance with
the requirements of this prospectus and the letter of transmittal in order to
participate in the exchange offer. Notwithstanding any other provision of the
exchange offer, or any extension of the exchange offer, we will not be required
to accept for exchange any unregistered senior securities, and may terminate or
amend the exchange offer if:
o the exchange offer, or the making of any exchange by a senior security
holder, violates applicable law or any applicable interpretation of
the staff of the SEC,
o any action or proceeding shall have been instituted or threatened with
respect to the exchange offer which, in our judgment or the judgment
of the guarantor, would impair our ability to proceed with the
exchange offer, and
o any law, rule or regulation or applicable interpretations of the staff
of the SEC have been issued or promulgated which, in our good faith
determination or the good faith determination of the guarantor, does
not permit us to effect the exchange offer.
If we determine in our sole discretion that any of the above events or
conditions has occurred, we may, subject to applicable law, terminate the
exchange offer and return all unregistered senior securities tendered for
exchange, or we may waive any condition or amend the terms of the exchange
offer. Any determination by us concerning the events described above will be
final and binding upon parties.
Expiration Date; Extensions; Amendment; Termination
The exchange offer will expire 5:00 p.m., New York City time, on
February , 2001, unless, in our sole discretion, we extend it.
We reserve the right:
o to delay accepting any unregistered senior security;
o to amend the terms of the exchange offer in any manner;
o to extend the exchange offer; or
o to terminate the exchange offer, if any of the conditions set forth
above occur and we do not waive them.
21
We will give oral or written notice of any amendment, non-acceptance or
termination to registered holders of the unregistered senior securities as
promptly as practicable. In the case of any extension, we will notify the
exchange agent orally (promptly confirmed in writing) or in writing of any
extension. We will also notify the registered holders of unregistered senior
securities of the extension no later than 9:00 a.m., New York City time, on the
business day after the previously scheduled expiration of the exchange offer.
If we consider an amendment to the exchange offer to be material, we
will promptly inform the holders of unregistered senior securities of such
amendment in a reasonable manner.
If we decide to terminate the exchange offer, as set forth above, we
may
o refuse to accept any unregistered senior securities and return any
unregistered senior securities that have been tendered to the holders;
o extend the exchange offer and retain all unregistered senior
securities tendered prior to the expiration of the exchange offer,
subject to the rights of such holders of tendered unregistered senior
securities to withdraw their tendered unregistered senior securities,
or
o waive such termination event with respect to the exchange offer and
accept all properly tendered unregistered senior securities that have
not been withdrawn. If such waiver constitutes a material change in
the exchange offer, we will disclose such change by means of a
supplement to this prospectus that will be distributed to each
registered holder of unregistered senior securities, and we will
extend the exchange offer for a period of five to ten business days,
depending upon the significance of the waiver and the manner of
disclosure to the registered holders of the unregistered senior
securities, if the exchange offer would otherwise expire during such
period.
Without limiting the manner by which we may choose to make public
announcements of any delay in acceptance, extension, termination or amendment of
the exchange offer, we will have no obligation to publish, advertise, or
otherwise communicate any such public announcement, other than by making a
timely release to a financial news service.
Interest on the Exchange Senior Securities
The exchange senior securities will accrue interest from the date
interest was last paid on the unregistered senior securities. If no interest was
paid on your unregistered senior securities, your exchange senior securities
will accrue interest from and including January 17, 2001. Interest will be paid
on the exchange senior securities semi-annually on January 30 and July 30 of
each year, except that there will be no January 30, 2001 interest payment date
for any exchange 2006 senior notes. Holders of unregistered senior securities
that are accepted for exchange will be deemed to have waived the right to
receive any payment in respect of interest accrued from the date of the last
interest payment date that was made in respect of the unregistered senior
securities until the date of the issuance of the exchange senior securities.
Consequently, holders who exchange their unregistered senior securities will
receive the same interest payments they would have received had they not
accepted the exchange offer.
Resale of Exchange Senior Securities
Based upon existing interpretations of the staff of the SEC set forth
in several no-action letters issued to third parties, we believe that the
exchange senior securities issued pursuant to the exchange offer in exchange for
the unregistered senior securities may be offered for resale, resold and
otherwise
22
transferred by their holders, without complying with the registration and
prospectus delivery provisions of the Securities Act, provided that:
o any exchange senior securities to be received by you will be acquired
in the ordinary course of your business;
o you are not engaged in, do not intend to engage in or have any
arrangement or understanding with any person to participate in the
distribution of the unregistered senior securities or exchange senior
securities;
o you are not an "affiliate" (as defined in Rule 405 under the
Securities Act) of Viacom or Viacom International or, if you are such
an affiliate, you will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent applicable;
o if you are a broker-dealer, you are not engaged in, and do not intend
to engage in, the distribution of exchange senior securities;
o if you are a broker-dealer, you will receive exchange senior
securities for your own account in exchange for unregistered senior
securities that were acquired as a result of market-making activities
or other trading activities and that you will deliver a prospectus in
connection with any resale of such exchange senior securities; and
o you are not acting on behalf of any person who could not truthfully
make the foregoing representations.
Holders of unregistered senior securities wishing to accept the
exchange offer must represent to us that such conditions have been met.
Each broker-dealer that receives exchange senior securities in exchange
for unregistered senior securities held for its own account, as a result of
market-making or other trading activities, must acknowledge that it will deliver
a prospectus in connection with any resale of the exchange senior securities.
The letter of transmittal states that by so acknowledging and by delivering a
prospectus, such broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act. The prospectus, as it
may be amended or supplemented from time to time, may be used by such
broker-dealer in connection with resales of exchange senior securities received
in exchange for unregistered senior securities. We have agreed that, for a
period of 180 days after the expiration of the exchange offer, we will make this
prospectus and any amendment or supplement to this prospectus available to any
such broker-dealer for use in connection with any such resale.
Clearing of the Exchange Senior Securities
Upon consummation of the exchange offer, the exchange 2006 senior
securities will have different CUSIP numbers, different Common Codes and
different ISINs from those under which the Rule 144A securities have traded
(and, to the extent not tendered, will continue to trade). Upon consummation of
the exchange offer, the exchange 2010 senior securities and the exchange
debentures will have the same CUSIP numbers, Common Codes and ISINs given to our
7.70% senior notes due 2010 and our 7.875% senior debentures due 2030,
respectively, which were issued on August 1, 2000.
Regulation S senior securities not tendered for exchange will continue
to clear through Euroclear and Clearstream Luxembourg under their original
Common Codes and their ISINs will remain the same. Regulation S senior
securities (unless acquired by a manager as part of their original distribution)
may
23
now be sold in the United States or to U.S. persons and, upon any such transfer,
a beneficial interest in the Regulation S global senior securities will be able
to be exchanged for an interest in the exchange global senior security in
accordance with procedures established by Euroclear or Clearstream Luxembourg
and DTC.
Beneficial interests in the restricted Regulation S global senior
securities may be transferred to a person who takes delivery in the form of an
interest in the Regulation S global senior securities upon receipt by the
trustee of a written certification from the transferor, in the form provided in
the Indenture, to the effect that the transfer is being made in accordance with
Rule 903 or 904 of Regulation S.
We cannot predict the extent to which beneficial owners of an interest
in the Regulation S global senior securities will participate in the exchange
offer. Beneficial owners should consult their own financial advisors as to the
benefits to be obtained from exchange.
Procedures for Tendering
The term "holder" with respect to the exchange offer means any person
in whose name unregistered senior securities are registered on our books or any
other person who has obtained a properly completed bond power from the
registered holder, or any person whose unregistered senior securities are held
of record by DTC, Euroclear or Clearstream Luxembourg who desires to deliver
such unregistered senior securities by book-entry transfer at DTC, Euroclear or
Clearstream Luxembourg as the case may be.
Except in limited circumstances, only a Euroclear participant,
Clearstream Luxembourg participant or a DTC participant listed on a DTC
securities position listing with respect to the unregistered senior securities
may tender its unregistered senior securities in the exchange offer. To tender
unregistered senior securities in the exchange offer:
o holders of unregistered senior securities that are DTC participants
may follow the procedures for book-entry transfer as provided for
below under "Book-Entry Transfer" and in the letter of transmittal.
o Euroclear participants and Clearstream Luxembourg participants on
behalf of the beneficial owners of senior securities are required to
use book-entry transfer pursuant to the standard operating procedures
of Euroclear or Clearstream Luxembourg, as the case may be, which
include transmission of a computer-generated message to Euroclear or
Clearstream Luxembourg, as the case may be, in lieu of a letter of
transmittal. See the term "agent's message" under "Book-Entry
Transfer."
In addition, either:
o the exchange agent must receive any corresponding certificate or
certificates representing unregistered senior securities along with
the letter of transmittal;
o the exchange agent must receive, before expiration of the exchange
offer, a timely confirmation of book-entry transfer of unregistered
senior securities into the exchange agent's account at DTC, Euroclear
or Clearstream Luxembourg according to their respective standard
operating procedures for electronic tenders described below and a
properly transmitted agent's message described below; or
o the holder must comply with the guaranteed delivery procedures
described below.
24
The tender by a holder of unregistered senior securities will
constitute an agreement between such holder and us in accordance with the terms
and subject to the conditions set forth in this prospectus and in the letter of
transmittal. If less than all the unregistered senior securities held by a
holder of unregistered senior securities are tendered, a tendering holder should
fill in the amount of unregistered senior securities being tendered in the
specified box on the letter of transmittal. The entire amount of unregistered
senior securities delivered to the exchange agent will be deemed to have been
tendered unless otherwise indicated.
The method of delivery of unregistered senior securities, the letter of
transmittal and all other required documents or transmission of an agent's
message, as described under "Book Entry Transfer," to the exchange agent is at
the election and risk of the holder. Instead of delivery by mail, we recommend
that holders use an overnight or hand delivery service. In all cases, sufficient
time should be allowed to assure timely delivery prior to the expiration of the
exchange offer. No letter of transmittal or unregistered senior securities
should be sent to us. Delivery of documents to DTC, Euroclear or Clearstream
Luxembourg in accordance with their respective procedures will not constitute
delivery to the exchange agent.
Any beneficial holder whose unregistered senior securities are
registered in the name of his broker, dealer, commercial bank, trust company or
other nominee and who wishes to tender should contact such registered holder
promptly and instruct such registered holder to tender on his behalf. If such
beneficial holder wishes to tender on his own behalf, such beneficial holder
must, prior to completing and executing the letter of transmittal and delivering
his or her unregistered senior securities, either:
o make appropriate arrangements to register ownership of the
unregistered senior securities in such holder's name, or
o obtain a properly completed bond power from the registered holder.
The transfer of record ownership may take considerable time and may not
be completed prior to the expiration date.
Signatures on a letter of transmittal or a notice of withdrawal as
described in "-- Withdrawal of Tenders" below, as the case may be, must be
guaranteed by a member firm of a registered national securities exchange or of
the National Association of Securities Dealers, Inc., a commercial bank or trust
company having an office or correspondent in the United States or an "eligible
guarantor institution" within the meaning of Rule 17Ad-15 under the Exchange
Act, unless the unregistered senior securities tendered pursuant thereto are
tendered:
o by a registered holder who has not completed the box entitled "Special
Registration Instructions" or "Special Delivery Instructions" on the
letter of transmittal; or
o for the account of an eligible institution.
If the letter of transmittal is signed by a person other than the
registered holder of any unregistered senior securities listed therein, the
unregistered senior securities must be endorsed or accompanied by appropriate
bond powers which authorize the person to tender the unregistered senior
securities on behalf of the registered holder, in either case signed as the name
of the registered holder or holders appears on the unregistered senior
securities. If the letter of transmittal or any unregistered senior securities
or bond powers are signed by trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, such persons should so
25
indicate when signing and, unless waived by us, evidence satisfactory to us of
their authority to so act must be submitted with the letter of transmittal.
We will determine in our sole discretion all the questions as to the
validity, form, eligibility (including time of receipt), acceptance and
withdrawal of the tendered unregistered senior securities. Our determinations
will be final and binding. We reserve the absolute right to reject any and all
unregistered senior securities not validly tendered or any unregistered senior
securities our acceptance of which would, in the opinion of our counsel, be
unlawful. We also reserve the absolute right to waive any irregularities or
conditions of tender as to particular unregistered senior securities. Our
interpretation of the terms and conditions of the exchange offer (including the
instructions in the letter of transmittal) will be final and binding on all
parties. Unless waived, any defects or irregularities in connection with tenders
of unregistered senior securities must be cured within such time as we will
determine. Neither we, the exchange agent nor any other person shall be under
any duty to give notification of defects or irregularities with respect to
tenders of unregistered senior securities nor shall any of them incur any
liability for failure to give such notification. Tenders of unregistered senior
securities will not be deemed to have been made until such irregularities have
been cured or waived. Any unregistered senior securities received by the
exchange agent that are not properly tendered and as to which the defects or
irregularities have not been cured or waived will be returned without cost by
the exchange agent to the tendering holder of such unregistered senior
securities unless otherwise provided in the letter of transmittal, as soon as
practicable following the expiration date of the exchange offer.
In addition, we reserve the right in our sole discretion to (a)
purchase or make offers for any unregistered senior securities that remain
outstanding subsequent to the expiration date, and (b) to the extent permitted
by applicable law, purchase unregistered senior securities in the open market,
in privately negotiated transactions or otherwise. The terms of any such
purchases or offers may differ from the terms of the exchange offer.
By signing the letter of transmittal, each tendering holder of
unregistered senior securities will represent to us that, among other things:
o any exchange senior securities to be received by the holder will be
acquired in the ordinary course of the holder's business;
o the holder is not engaged in, does not intend to engage in or have any
arrangement or understanding with any person to participate in the
distribution of the unregistered senior securities or exchange senior
securities;
o the holder is not an "affiliate" (as defined in Rule 405 under the
Securities Act) of Viacom or Viacom International or, if the holder is
such an affiliate, the holder will comply with the registration and
prospectus delivery requirements of the Securities Act to the extent
applicable;
o if the holder is a broker-dealer, the holder is not engaged in, and
does not intend to engage in, the distribution of exchange senior
securities;
o if the holder is a broker-dealer, the holder will receive exchange
senior securities for the holder's own account in exchange for
unregistered senior securities that were acquired as a result of
market-making activities or other trading activities and that the
holder will deliver a prospectus in connection with any resale of such
exchange senior securities (see "Plan of Distribution" below); and
26
o the holder is not acting on behalf of any person who could not
truthfully make the foregoing representations.
Book-Entry Transfer
We understand that the exchange agent will make a request promptly
after the date of this document to establish accounts with respect to the
unregistered senior securities at DTC, Euroclear or Clearstream Luxembourg for
the purpose of facilitating the exchange offer. Any financial institution that
is a participant in DTC's system may make book-entry delivery of unregistered
senior securities by causing DTC to transfer such unregistered senior securities
into the exchange agent's DTC account in accordance with DTC's Automated Tender
Offer Program procedures for such transfer. Any participant in Euroclear or
Clearstream Luxembourg may make book-entry delivery of Regulation S unregistered
senior securities by causing Euroclear or Clearstream Luxembourg to transfer
such senior securities into the exchange agent's account in accordance with
established Euroclear or Clearstream Luxembourg procedures for transfer. The
exchange for tendered unregistered senior securities will only be made after a
timely confirmation of a book-entry transfer of the unregistered senior
securities into the exchange agent's account, and timely receipt by the exchange
agent of an agent's message.
The term "agent's message" means a message, transmitted by DTC,
Euroclear or Clearstream Luxembourg, as the case may be, and received by the
exchange agent and forming part of the confirmation of a book-entry transfer,
which states that DTC, Euroclear or Clearstream Luxembourg, as the case may be,
has received an express acknowledgment from a participant tendering unregistered
senior securities and that such participant has received an appropriate letter
of transmittal and agrees to be bound by the terms of the letter of transmittal,
and we may enforce such agreement against the participant. Delivery of an
agent's message will also constitute an acknowledgment from the tendering DTC,
Euroclear or Clearstream Luxembourg participant, as the case may be, that the
representations contained in the appropriate letter of transmittal and described
above are true and correct.
Guaranteed Delivery Procedures
Holders who wish to tender their unregistered senior securities and (i)
whose unregistered senior securities are not immediately available, or (ii) who
cannot deliver their unregistered senior securities, the letter of transmittal,
or any other required documents to the exchange agent prior to the expiration
date, or if such holder cannot complete the procedure under the respective DTC,
Euroclear or Clearstream Luxembourg standard operating procedures for electronic
tenders before expiration of the exchange offer, may tender their unregistered
senior securities if:
o the tender is made through an eligible institution;
o before expiration of the exchange offer, the exchange agent receives
from the eligible institution either a properly completed and duly
executed notice of guaranteed delivery in the form accompanying this
prospectus, by facsimile transmission, mail or hand delivery, or a
properly transmitted agent's message in lieu of notice of guaranteed
delivery:
o setting forth the name and address of the holder and the
registered number(s), the certificate number or numbers of the
unregistered senior securities tendered and the principal amount
of unregistered senior securities tendered;
o stating that the tender offer is being made by guaranteed
delivery; and
27
o guaranteeing that, within five business days after expiration of
the exchange offer, the letter of transmittal, or facsimile of
the letter of transmittal, together with the unregistered senior
securities tendered or a book-entry confirmation, and any other
documents required by the letter of transmittal will be deposited
by the eligible institution with the exchange agent; and
o the exchange agent receives the properly completed and executed letter
of transmittal, or facsimile of the letter of transmittal, as well as
all tendered unregistered senior securities in proper form for
transfer or a book-entry confirmation, and all other documents
required by the letter of transmittal, within five business days after
expiration of the exchange offer.
Upon request to the exchange agent, a notice of guaranteed delivery
will be sent to holders who wish to tender their unregistered senior securities
according to the guaranteed delivery procedures set forth above.
Withdrawal of Tenders
Except as otherwise provided herein, tenders of unregistered senior
securities may be withdrawn at any time prior to 5:00 p.m., New York City time,
on the expiration date of the exchange offer.
For a withdrawal to be effective:
o the exchange agent must receive a written notice, which may be by
telegram, telex, facsimile transmission or letter, of withdrawal at
the address set forth below under "Exchange Agent"; or
o for DTC, Euroclear or Clearstream Luxembourg participants, holders
must comply with their respective standard operating procedures for
electronic tenders and the exchange agent must receive an electronic
notice of withdrawal from DTC, Euroclear or Clearstream Luxembourg.
Any notice of withdrawal must:
o specify the name of the person who tendered the unregistered senior
securities to be withdrawn;
o identify the unregistered senior securities to be withdrawn, including
the certificate number or numbers and principal amount of the
unregistered senior securities to be withdrawn;
o be signed by the person who tendered the unregistered senior
securities in the same manner as the original signature on the letter
of transmittal, including any required signature guarantees; and
o specify the name in which the unregistered senior securities are to be
re-registered, if different from that of the withdrawing holder.
If unregistered senior securities have been tendered pursuant to the
procedure for book-entry transfer described above, any notice of withdrawal must
specify the name and number of the account at DTC, Euroclear or Clearstream
Luxembourg to be credited with the withdrawn unregistered senior
28
securities and otherwise comply with the procedures of the facility. We will
determine all questions as to the validity, form and eligibility (including time
of receipt) for such withdrawal notices, and our determination shall be final
and binding on all parties. Any unregistered senior securities so withdrawn will
be deemed not to have been validly tendered for purposes of the exchange offer
and no exchange senior securities will be issued with respect thereto unless the
unregistered senior securities so withdrawn are validly tendered. Any
unregistered senior securities which have been tendered but which are not
accepted for exchange will be returned to the holder without cost to such holder
as soon as practicable after withdrawal, rejection of tender or termination of
the exchange offer. Properly withdrawn unregistered senior securities may be
re-tendered by following the procedures described above under "Procedures for
Tendering" at any time prior to the expiration date.
Consequences of Failure to Exchange
Unregistered senior securities that are not exchanged will remain
"restricted securities" within the meaning of Rule 144(a)(3) of the Securities
Act. Accordingly, they may not be offered, sold, pledged or otherwise
transferred, except:
o to us or to any of our subsidiaries,
o inside the United States to a qualified institutional buyer in
compliance with Rule 144A,
o inside the United States to an institutional accredited investor that,
prior to such transfer, furnishes to the trustee a signed letter
containing certain representations and agreements relating to the
restrictions on transfer of the unregistered senior securities, the
form of which you can obtain from the trustee, and, at our request, an
opinion of counsel acceptable to us that the transfer complies with
the Securities Act,
o outside the United States in compliance with Rule 904 under the
Securities Act,
o pursuant to the exemption from registration provided by Rule 144 under
the Securities Act, if available, or
o pursuant to an effective registration statement under the Securities
Act.
The liquidity of the unregistered senior securities could be adversely
affected by the exchange offer. Following the consummation of the exchange
offer, holders of unregistered senior securities will have no further
registration rights under the registration rights agreement.
Exchange Agent
Citibank, N.A. has been appointed as the principal exchange agent and
Kredietbank S.A. Luxembourgeoise has been appointed as the Luxembourg exchange
agent for the exchange of the unregistered senior securities. In its capacity as
Luxembourg exchange agent, Kredietbank will act solely as an intermediary
between holders of unregistered senior securities wishing to accept the exchange
offer and the principal exchange agent. Kredietbank will forward the tenders it
receives to the principal exchange agent. Questions and requests for assistance
relating to the exchange of the unregistered senior securities should be
directed to the exchange agents addressed as follows:
By Mail or Hand Delivery:
Citibank N.A. Kredietbank S.A. Luxembourgeoise
29
111 Wall Street, 5th Floor 43, Boulevard Royal
New York, New York 10005 L-2955 Luxembourg
Facsimile Transmission: Facsimile Transmission:
(212) 825-3483 (352) 47 97 73 951
Confirm by Telephone: Confirm by Telephone:
(800) 422-2066 (352) 47 97 3933
Fees and Expenses
We will bear the expenses of soliciting tenders pursuant to the
exchange offer. The principal solicitation for tenders pursuant to the exchange
offer is being made by mail. Additional solicitations may be made by our
officers and regular employees and our affiliates in person, by telegraph or
telephone.
We will not make any payments to brokers, dealers or other persons
soliciting acceptances of the exchange offer. We, however, will pay the exchange
agent reasonable and customary fees for its services and will reimburse the
exchange agent for its related reasonable out-of-pocket expenses and accounting
and legal fees. We may also pay brokerage houses and other custodians, nominees
and fiduciaries the reasonable out-of-pocket expenses incurred by them in
forwarding copies of this prospectus, letters of transmittal and related
documents to the beneficial owners of the unregistered senior securities and in
handling or forwarding tenders for exchange.
We will pay all transfer taxes, if any, applicable to the exchange of
unregistered senior securities pursuant to the exchange offer. The tendering
holder, however, will be required to pay any transfer taxes whether imposed on
the registered holder or any other person, if:
o certificates representing exchange senior securities or unregistered
senior securities for principal amounts not tendered or accepted for
exchange are to be delivered to, or are to be registered or issued in
the name of, any person other than the registered holder of
unregistered senior securities tendered;
o tendered unregistered senior securities are registered in the name of
any person other than the person signing the letter of transmittal; or
o a transfer tax is imposed for any reason other than the exchange of
unregistered senior securities under the exchange offer.
If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with the letter of transmittal, the amount of such
transfer taxes will be billed directly to such tendering holder.
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DESCRIPTION OF SENIOR SECURITIES
Whenever we refer in this prospectus to the senior notes due 2006
issued on January 17, 2001, the senior notes due 2010 issued on January 17,
2001, or the senior debentures due 2030 issued on January 17, 2001, we will
refer to them as the "unregistered 2006 senior notes", the "unregistered 2010
senior notes", or the "unregistered senior debentures", respectively. Whenever
we refer collectively in this prospectus to the unregistered 2006 senior notes,
the unregistered 2010 senior notes and the unregistered senior debentures, we
will refer to them as the "unregistered senior securities". Whenever we refer in
this prospectus to the new senior notes due 2006, the new senior notes due 2010
or the new senior debentures due 2030, we will refer to them as the "exchange
2006 senior notes", the "exchange 2010 senior notes" or the "exchange senior
debentures", respectively. Whenever we refer collectively in this prospectus to
the exchange 2006 senior securities, the exchange 2010 senior securities and the
exchange senior debentures, we will refer to them as the "exchange senior
securities". The unregistered 2006 senior notes and the exchange 2006 senior
notes are collectively referred to as the "2006 senior notes"; the unregistered
2010 senior notes and the exchange 2010 senior notes are collectively referred
to as the "2010 senior notes"; the unregistered senior debentures and the
exchange senior debentures are collectively referred to as the "senior
debentures"; and the unregistered senior securities and the exchange senior
securities are collectively referred to as the "senior securities".
General
We issued the unregistered senior securities and will issue the
exchange senior securities under the Indenture, dated as of May 15, 1995, among
us, our wholly owned subsidiary, Viacom International, as guarantor, and
Citibank, N.A., as successor to State Street Bank and Trust Company and The
First National Bank of Boston, Trustee. The Indenture was supplemented by the
First Supplemental Indenture, dated as of May 24, 1995, was supplemented and
amended by the Second Supplemental Indenture and Amendment No. 1, dated as of
December 15, 1995, was supplemented by the Third Supplemental Indenture, dated
as of July 22, 1996, was supplemented by the Fourth Supplemental Indenture,
dated as of August 1, 2000, and, in connection with the unregistered senior
securities, was supplemented by a Fifth Supplemental Indenture, dated January
17, 2001. We refer to the Indenture, as so supplemented and amended, as the
"Indenture".
The terms of the exchange senior securities to be issued are
substantially similar to the unregistered senior securities, except that the
exchange senior securities have been registered under the Securities Act of
1933, the certificates for the exchange senior securities will not bear legends
restricting their transfer and the exchange senior securities will not have
registration rights or any rights to additional interest.
The senior securities initially are limited to $1,650,000,000 principal
amount, consisting of $400,000,000 principal amount of senior notes due 2006,
$500,000,000 principal amount of senior notes due 2010 and $750,000,000
principal amount of senior debentures due 2030. The unregistered 2010 senior
notes and the unregistered senior debentures will be, upon their exchange for
exchange 2010 senior notes or exchange senior debentures registered under the
Securities Act, further issuances of our 7.70% senior notes due 2010,
$1,150,000,000 of which were issued on August 1, 2000, and our 7.875% senior
debentures due 2030, $500,000,000 of which were issued on August 1, 2000.
Each exchange senior security will bear interest at the applicable
annual rate noted on the cover page of this prospectus. Interest will be payable
on the exchange senior securities on January 30 and July 30 of each year
beginning January 30, 2001, except that there will be no January 30, 2001
interest payment date for any exchange 2006 senior notes. Holders of
unregistered senior securities that are
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accepted for exchange will be deemed to have waived the right to receive any
payment in respect of interest accrued from the date of the last interest
payment date that was made in respect of the unregistered senior securities
until the date of the issuance of the exchange senior securities. Interest will
be computed on the basis of a 360-day year of 30-day months. Consequently,
holders who exchange their unregistered senior securities will receive the same
interest payments they would have received had they not accepted the exchange
offer. Interest on the exchange senior securities will accrue from and including
the settlement date and will be paid to holders of record on the July 15 or
January 15 immediately before the interest payment date.
The 2006 senior notes will mature on January 30, 2006. The 2010 senior
notes will mature on July 30, 2010. The senior debentures will mature on July
30, 2030. On the maturity dates of the senior securities, the holders will be
entitled to receive 100% of the principal amount of the applicable exchange
senior securities. We may redeem the 2010 senior notes and the senior debentures
at any time at their principal amount, plus the applicable premium and accrued
interest. The senior securities do not provide for any sinking fund.
The senior securities are issued in denominations of not less than
$1,000 and integral multiples thereof.
The senior securities are unsecured obligations of Viacom. The senior
securities rank senior to debt of Viacom that is subordinated to the exchange
senior securities and rank equally with debt of Viacom that is not subordinated
to the senior securities. The guarantees are unsecured obligations of Viacom
International. The guarantees rank senior to debt of Viacom International that
is subordinated to the guarantees and rank equally with debt of Viacom
International that is not subordinated to the guarantees. The senior securities
effectively will be junior to all liabilities of Viacom's subsidiaries except
Viacom International and all secured debt of Viacom and its subsidiaries.
As of September 30, 2000, our subsidiaries, other than Viacom
International, had approximately $12.0 billion of indebtedness outstanding. This
indebtedness was primarily incurred by Infinity and its subsidiaries and
Blockbuster. Viacom, the issuer of the senior securities, owns several operating
subsidiaries, including Viacom International, the guarantor of the senior
securities, Infinity and Blockbuster. Viacom International is a wholly owned
subsidiary of Viacom, with approximately $840 million of indebtedness
outstanding as of September 30, 2000.
Guarantees
Viacom International will unconditionally guarantee the due and
punctual payment of the principal of, premium, if any, and any interest on the
senior securities when and as the same shall become due and payable, whether at
maturity, upon redemption, upon acceleration or otherwise. The guarantees of the
senior securities will be endorsed on the senior securities.
The Indentureindenture provides that in the event that the guarantees would constitute or result in a fraudulent transfer or conveyance for purposes of, or result in a violation of, any United States federal, or applicable United States state, fraudulent transfer or conveyance or similar law, then the liability of Viacom InternationalCBS Operations under the guarantees shall be reduced to the extent necessary to eliminate such fraudulent transfer or conveyance or violation under the applicable fraudulent transfer or conveyance or similar law. Application of this clause could limit the amount which holders of senior securitiesexchange notes may be entitled to collect under the guarantees. Holders, by their acceptance of the senior securities,exchange notes, will have agreed to such limitations. See "Risk Factors --
Fraudulent Conveyance Considerations."
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The
To the extent that a court were to find that (i) a guarantee was incurred by CBS Operations with the intent to hinder, delay or defraud any present or future creditor or (ii) CBS Operations did not receive fair consideration or reasonably equivalent value for issuing its guarantee and CBS Operations (a) was insolvent or rendered insolvent by reason of the issuance of the guarantee, (b) was engaged or about to engage in a business or transaction for which the remaining assets of CBS Operations constituted unreasonably small capital to carry on its business or
(c) intended to incur, or believed that it would incur, debts beyond its ability to pay such debts as they matured, the court could subordinate or avoid all or part of such guarantee in favor of CBS Operations’ other creditors. To the extent any guarantee issued by CBS Operations was voided as a fraudulent conveyance or held unenforceable for any other reason, the holders of the exchange notes could cease to have any claim against CBS Operations and would be creditors solely of CBS Corporation.
We and CBS Operations believe that the issuances of the guarantees represent unsecured obligations of Viacom International
and rank equal to the other unsecured obligations of Viacom International whichby CBS Operations are not subordinatedfraudulent conveyances. There can be no assurance, however, that a court passing on such questions would reach the same conclusions. In rendering their opinions on the validity of the exchange notes and the related guarantees, neither our counsel nor counsel for CBS Operations will express any opinion as to the guarantees.
federal or state laws relating to fraudulent transfers.
Optional Redemption
Prior
Commencing on May 1, 2023 (one month prior to their maturity date) (the “2023 par call date”), we may redeem the 2010 senior2023 exchange notes, and the senior
debentures at any time, at our option in whole or in part, on not less than 30
nor more than 60 days' prior notice, priorat any time and from time to their maturitytime at a redemption
price equal to100% of the sum of their principal amount of the Make-Whole Amount
described below and any2023 exchange notes being redeemed plus accrued and unpaid interest to the redemption date, and, commencing on March 1, 2028 (three months prior to their maturity date) (the “2028 par call date”), we may redeem the 2028 exchange notes, at our option in whole or in part, at any time and from time to time at 100% of redemption.
Holdersthe principal amount of recordthe 2028 exchange notes being redeemed plus accrued and unpaid interest to the redemption date.
Prior to the 2023 par call date in the case of the 2023 exchange notes and prior to the 2028 par call date in the case of the 2028 exchange notes, the exchange notes will be redeemable, at our option in whole or in part, at any time and from time to time, at a “make-whole premium” redemption price calculated by us equal to the greater of:
| (a) | 100% of the principal amount of the exchange notes of the series of exchange notes to be redeemed, and |
| (b) | the sum of the present values of the remaining scheduled payments of principal and interest, assuming that such series matured on the applicable par call date (not including any portion of such payments of interest accrued to the redemption date), discounted to the redemption date on a semi-annual basis (assuming a360-day year consisting of twelve30-day months) at the Treasury Rate (as defined below), plus 15basis points in the case of the 2023 exchange notes and 25 basis points in the case of the 2028 exchange notes, |
plus, in each case, accrued and unpaid interest to the redemption date. Notwithstanding the foregoing, installments of interest on a record dateexchange notes that isare due and payable on interest payment dates falling on or prior to a redemption date for such exchange notes will be entitled to receive interest duepayable on the interest payment date.
The term "Make-Whole Amount" means,date to the excess, if any, of (i) the
aggregate present valueregistered holders as of the close of business on the relevant record date according to such exchange notes and the indenture.
For purposes of the optional redemption provisions of principal being
redeemed and the amount of interest (exclusive of interest accruedexchange notes, the following terms have the meanings indicated below:
“Comparable Treasury Issue” means the United States Treasury security or securities selected by an Independent Investment Banker as having an actual or interpolated maturity comparable to the dateremaining term, or the “Remaining Life,” of redemption)the exchange notes to be redeemed (assuming for this purpose that such series of exchange notes matured on the applicable par call date) that would have been payablebe utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of a comparable maturity to the Remaining Life of such exchange notes.
“Comparable Treasury Price” means, with respect to any redemption date, (i) the average of four Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest such Reference Treasury Dealer Quotations, or (ii) if the Independent Investment Banker obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations, or (iii) if only one Reference Treasury Dealer Quotation is received, such quotation.
“Independent Investment Banker” means a Reference Treasury Dealer appointed by us.
“Reference Treasury Dealer” means a primary U.S. Government securities dealer in the United States selected by us.
“Reference Treasury Dealer Quotation” means, with respect to each Reference Treasury Dealer and any redemption had not been made,date, the average, as determined by discounting, onthe Independent Investment Banker, of the bid and asked prices for the applicable Comparable Treasury Issue (expressed as a semiannual basis,percentage of its principal amount) quoted in writing to the remaining principal and
interestIndependent Investment Banker by such Reference Treasury Dealer at the Reinvestment Rate described below (determined3:30 p.m., New York City time, on the third business day preceding such redemption date.
“Treasury Rate” means, with respect to a series of exchange notes, on a redemption date, the date notice of redemption is given) from rate per annum equal to:
the dates on
whichyield, under the principal and interest would have been payable ifheading that represents the redemption had
not been made, to the date of redemption, over (ii) the aggregate principal
amount of the exchange 2010 senior notes or the exchange senior debentures being
redeemed.
The term "Reinvestment Rate" means 0.25%average for the exchange 2010 senior
notes and 0.35% for the exchange senior debentures, in each case plus the
arithmetic mean of the yields under the heading" Week Ending" publishedimmediately preceding week, appearing in the most recentrecently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve Statistical Release H.15System and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption "Treasury“Treasury Constant Maturities"Maturities,” for the maturity (rounded to the nearest month)
corresponding to the remaining life to maturity, as of the payment date of the
principal being redeemed or paid. IfComparable Treasury Issue; provided that if no maturity exactly corresponds tois within three months before or after the maturity,Remaining Life, yields for the two published maturities most closely corresponding to the maturity wouldComparable Treasury Issue will be so calculateddetermined and the ReinvestmentTreasury Rate wouldwill be interpolated or extrapolated from those yields on a straight-line basis rounding to the nearest month. month; or
if that release, or any successor release, is not published during the week preceding the calculation date or does not contain such yields, the rate per year equal to the semiannual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for that redemption date.
The most recent Federal Reserve Statistical Release H.15 publishedTreasury Rate will be calculated at 5:00 p.m. (New York City time) on the third business day preceding the redemption date by the Reference Treasury Dealer.
Notice of any redemption will be distributed at least 15 days but not more than 45 days before the redemption date to each holder of the exchange notes to be redeemed. Unless we default in payment of the redemption price, on and after the redemption date, interest will cease to accrue on the exchange notes called for redemption. If fewer than all of the exchange notes are to be redeemed, the exchange notes to be redeemed shall be selected by the trustee by lot or by another method the trustee deems to be fair and appropriate and in accordance with applicable depositary procedures. No exchange notes of a principal amount of $2,000 or less will be redeemed in part. In addition, at any time we may repurchase exchange notes in the open market and may hold or surrender such exchange notes to the trustee for cancellation.
Purchase of Exchange Notes Upon a Change of Control Repurchase Event
Upon the occurrence of a Change of Control Repurchase Event (as defined below) in respect of the exchange notes, unless we have exercised our right to redeem the exchange notes as described under “—Optional Redemption” above, we will be required to make an offer to each holder of the exchange notes to repurchase all
or any part (equal to $2,000 or an integral multiple of $1,000 in excess thereof) of such holder’s exchange notes pursuant to the offer described below at a purchase price equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest, if any, to the date of repurchase. Within 30 days following any Change of Control Repurchase Event in respect of the exchange notes or, at our option, prior to any Change of Control (as defined below), but after the public announcement of the Change of Control, we will mail a notice to each holder describing the transaction or transactions that constitute or may constitute the Change of Control Repurchase Event and offering to repurchase the exchange notes on the payment date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is mailed. The notice shall, if mailed prior to the date of determinationconsummation of the Make-Whole Amount will be used for purposesChange of calculatingControl, state that the Reinvestment Rate.
The Make-Whole Amount will be calculated by an independent investment
banking institutionoffer to repurchase is conditioned on the Change of national standing appointed by us. If we fail to make the
appointment at least 45 business daysControl Repurchase Event occurring on or prior to the payment date specified in the notice.
We will comply with the requirements of redemption,Rule14e-1 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and any other securities laws and regulations to the extent those laws and regulations are applicable in connection with the repurchase of the exchange notes as a result of a Change of Control Repurchase Event. To the extent that the provisions of any securities laws or ifregulations conflict with the institution is unwilling or unableChange of Control Repurchase Event provisions of the exchange notes, we will comply with the applicable securities laws and regulations and will not be deemed to have breached our obligations under the Change of Control Repurchase Event provisions of the exchange notes by reason of such conflict.
On the Change of Control Repurchase Event payment date, we will, to the extent lawful:
| (1) | accept for payment all exchange notes or portions thereof properly tendered and not withdrawn pursuant to our offer; |
| (2) | deposit with the paying agent an amount sufficient to pay the aggregate purchase price in respect of all exchange notes or portions thereof properly tendered and accepted; and |
| (3) | deliver or cause to be delivered to the trustee the exchange notes properly accepted, together with an officer’s certificate stating the aggregate principal amount of exchange notes being purchased by us. |
The paying agent will promptly pay, from funds deposited by us for such purpose, to each holder of exchange notes properly tendered the purchase price for the exchange notes, and the trustee will promptly authenticate and mail (or cause to be transferred by book-entry) to each holder a new exchange note equal in principal amount to any unpurchased portion of any exchange notes surrendered.
We will not be required to make an offer to repurchase the calculation,exchange notes upon a Change of Control Repurchase Event if a third party makes an offer in the calculation will
be made by an independent investment banking institution of national standing
appointed bymanner, at the Trustee. If the Reinvestment Rate is not available as described
above, the Reinvestment Rate will be calculated by interpolation or
extrapolation of comparable rates selected by the independent investment banking
institution.
In the case of any partial redemption, selection of the 2010 senior
notes or the senior debentures for redemption will be made by the Trusteetimes and otherwise in compliance with the requirements of the principal U.S. national securities
exchange, if any, on which the 2010 senior notes or the exchange senior
debentures are listed or, if they are not listed on a U.S. national securities
exchange, by lot or by such other method as the Trustee in its sole discretion
deems to be fair and appropriate. The Luxembourg Stock Exchange has no such
requirements.
Further Issues
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We may from time to time without notice to, or the consent of, the
holders of a series of senior securities, create and issue further senior
securities of the same series, equal in rank to the senior securities in all
respects (or in all respects except for the payment of interest accruing prior
to the issue date of the new securities or except for the first payment of
interest following the issue date of the new securities) so that the new
securities may be consolidated and form a single series with the relevant series
of senior securities and have the same terms as to status, redemption or
otherwise as the relevant series of senior securities. In the event that we
issue additional senior securities of the same series, we will prepare a new
prospectus and make a new application to list such securities on the Luxembourg
Stock Exchange.
Payment of Additional Amounts
We will, subject to the exceptions and limitations set forth below, pay
as additional interest on the senior securities, such additional amounts as are
necessary in order that the net paymentan offer made by us and such third party purchases all exchange notes properly tendered and not withdrawn under its offer.
An “Affiliate” of CBS Corporation means any Person directly or indirectly controlling, controlled by or under direct or indirect common control with CBS Corporation, or directly or indirectly controlled by a paying agent of the principal
of and interest on the senior securities to a holder who is a non-United States
person (as defined under this heading below)Redstone Family Member.
“Below Investment Grade Rating Event, after deduction for any present or
future tax, assessment or other governmental charge of the United States or a
political subdivision or taxing authority thereof or therein, imposed by
withholding” with respect to the payment, willexchange notes, means that such exchange notes become rated below Investment Grade by all of the Rating Agencies on any date from the date of the public notice of an arrangement that results in a Change of Control until the end of the60-day period following public notice of the occurrence of a Change of Control (which period shall be extended so long as the rating of such exchange notes is under publicly announced consideration for possible downgrade by any of the Rating Agencies); provided that a Below Investment Grade Rating Event otherwise arising by virtue of a particular reduction in rating shall not be less thandeemed to have occurred in respect of a particular Change of Control (and thus shall not be deemed a Below Investment Grade Rating Event for purposes of the amount
provideddefinition of Change of Control
Repurchase Event hereunder) if the Rating Agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the series of senior securities to be then due and payable;
provided, however,trustee in writing at its request that the foregoing obligationreduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control shall have occurred at the time of the Below Investment Grade Rating Event).
“Change of Control” means the occurrence of any of the following:
| (1) | the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of our properties or assets and those of our subsidiaries, taken as a whole, to any “person” (individually and as that term is used in Section 13(d)(3) and Section 14(d)(2) of the Exchange Act), other than us or one of our Affiliates; |
| (2) | the first day on which a majority of the members of our board of directors are not Continuing Directors; |
| (3) | the consummation of any transaction or series of related transactions (including, without limitation, any merger or consolidation) the result of which is that any “person” (individually and as that term is used in Section 13(d)(3) and Section 14(d)(2) of the Exchange Act), other than us, one of our subsidiaries or Redstone Family Members, becomes the beneficial owner (as defined in Rules13d-3 and13d-5 under the Exchange Act), directly or indirectly, of more than 50% of our Voting Stock, and following such transaction or transactions, Redstone Family Members beneficially own less than 50% of our Voting Stock, in each case, measured by voting power rather than number of shares; or |
| (4) | the consummation of aso-called “going private/Rule13e-3 Transaction” that results in any of the effects described in paragraph (a)(3)(ii) of Rule13e-3 under the Exchange Act (or any successor provision) with respect to each class of our common stock, following which Redstone Family Members beneficially own, directly or indirectly, more than 50% of our Voting Stock, measured by voting power rather than number of shares. |
“Change of Control Repurchase Event” in respect of the exchange notes means the occurrence of both a Change of Control and a Below Investment Grade Rating Event in respect of the exchange notes.
“Continuing Directors” means, as of any date of determination, any member of our board of directors who:
| (1) | was a member of such board of directors on the first date that any of the exchange notes were issued; or |
| (2) | was nominated for election or elected to our board of directors (i) with the approval of Redstone Family Members representing not less than 50% of our Voting Stock, measured by voting power rather than number of shares, or (ii) with the approval of a majority of the Continuing Directors who were members of our board at the time of such nomination or election. |
“Fitch” means Fitch Ratings, Ltd. and its successors.
“Investment Grade” means a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating categories of Moody’s), BBB—or better by S&P (or its equivalent under any successor rating categories of S&P) or BBB—or better by Fitch (or its equivalent under any successor rating categories of Fitch) (or, in each case, if such Rating Agency ceases to pay additional amountsrate the exchange notes, for reasons outside of our control, the equivalent investment grade credit rating from any Rating Agency selected by us as a replacement Rating Agency).
“Moody’s” means Moody’s Investors Service, Inc., a subsidiary of Moody’s Corporation, and its successors.
“Rating Agency” means:
| (1) | each of Moody’s, S&P and Fitch; and |
| (2) | if any of Moody’s, S&P or Fitch ceases to rate the exchange notes or fails to make a rating of the exchange notes publicly available for reasons outside of our control, a “nationally recognized statistical rating organization” within the meaning of Rule15c3-1(c)(2)(vi)(F) under the Exchange Act selected by us as a replacement agency for any or all of Moody’s, S&P or Fitch, as the case may be. |
“Redstone Family Members” includes only the following persons: (i) Mr. Sumner Redstone; (ii) the estate of Mr. Redstone; (iii) each descendant of Mr. Redstone or spouse or former spouse of Mr. Redstone and their respective estates, guardians, conservators or committees; (iv) any spouse or former spouse of Mr. Redstone; (v) each Family Controlled Entity (as defined below); and (vi) the trustees, in their respective capacities as such, of each Family Controlled Trust (as defined below). The term “Family Controlled Entity” means: (i) anynot-for-profit corporation if more than 50% of its board of directors is composed of Redstone Family Members; (ii) any other corporation if more than 50% of the value of its outstanding equity is owned by Redstone Family Members; (iii) any partnership if more than 50% of the value of its partnership interests is owned by Redstone Family Members; and (iv) any limited liability or similar company if more than 50% of the value of the company is owned by Redstone Family Members. The term “Family Controlled Trust” includes certain trusts existing on November 13, 2017, and any other trusts the primary beneficiaries of which are Redstone Family Members, spouses of Redstone Family Members and/or charitable organizations, provided that if the trust is a wholly charitable trust, more than 50% of the trustees of such trust consist of Redstone Family Members.
“S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and its successors.
“Voting Stock” means stock of the class or classes having general voting power under ordinary circumstances to elect at least a majority of the board of directors, managers or trustees of a corporation (irrespective of whether or not at the time stock of any other class or classes shall not apply:
(1) to any tax, assessmenthave or other governmental charge that is
imposed or withheld solelymight have voting power by reason of the holder, or a fiduciary,
settlor, beneficiary, member or shareholderhappening of the holder if the holder is
an estate, trust, partnership or corporation, or a person holding a power
over an estate or trust administered by a fiduciary holder, being
considered as:
(a) being or having been present or engaged in a trade or
businessany contingency).
Holders will not be entitled to require us to purchase their exchange notes in the United Statesevent of a takeover, recapitalization, leveraged buyout, private equity investment or having or having had a permanent
establishment in the United States;
(b) having a current or former relationship with the United
States, including a relationship as a citizen or resident thereof;
(c) being or having been a foreign or domestic personal holding
company, a passive foreign investment company or a controlled foreign
corporation with respect to the United States or a corporation that
has accumulated earnings to avoid United States federal income tax;
(d) being or having been a "10-percent shareholder" of ours as
defined in Section 871(h)(3) of the Code (as defined in "United States
Tax Considerations") or any successor provision; or
(e) being a bank receiving payments on an extension of credit
made pursuant to a loan agreement entered into in the ordinary course
of its trade or business;
(2) to any holdersimilar transaction that is not the sole beneficial ownera Change of a senior
security, or a portion thereof, or that is a fiduciary or partnership, but
only to the extent that a beneficiary or settlor with respect to the
fiduciary, a beneficial owner or member of the partnership wouldControl. In addition, holders may not have
beenbe entitled to require us to purchase their exchange notes in certain circumstances involving a significant change in the paymentcomposition of an additional amount had the beneficiary,
settlor, beneficial owner or member received directly its beneficial or
distributive shareour board of the payment;
(3) to any tax, assessment or other governmental charge that is
imposed or withheld by reason of the failure of the holder or any other
person to comply with certification, identification or information
reporting requirements concerning the nationality, residence, identity ordirectors, including in connection with the United States, or otherwise with respect to the status,a proxy contest where our board of the holder
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or beneficial ownerdirectors does not approve a dissident slate of such senior security (or any beneficiary, settlor,
beneficial owner or member thereof), if compliance is required by statute,
by regulation of the United States Treasury Department or by an applicable
income tax treaty to which the United States is a party, or by any official
interpretation or ruling promulgated pursuant to any of the foregoing,directors but approves them as a
precondition to exemption from such tax, assessment or other governmental
charge;
(4) to any tax, assessment or other governmental charge that is
imposed otherwise than by withholding by us or a paying agent from the
payment;
(5) to any tax, assessment or other governmental charge that is
imposed or withheld solely by reason of a change in law, regulation, or
administrative or judicial interpretation that becomes effective more than
15 days after the payment becomes due or is duly provided for, whichever
occurs later;
(6) to any estate, inheritance, gift, sales, excise, transfer, wealth
or personal property tax or similar tax, assessment or other governmental
charge;
(7) to any tax, assessment or other governmental charge required to be
withheld by any paying agent from any payment of principal of or interest
on any senior security, if such payment can be made without such
withholding by any other paying agent; or
(8) in the case of any combination of items (1), (2), (3), (4), (5),
(6) and (7).
Continuing Directors.
Certain Covenants
The senior securities are subject in all cases to any tax, fiscal or
other law or regulation or administrative or judicial interpretation applicable
thereto. Except as specifically provided under this heading "-- Payment of
Additional Amounts" and under the heading "-- Redemption for Tax Reasons," we
shall not be required to make any payment with respect to any tax, assessment or
other governmental charge imposed by any government or a political subdivision
or taxing authority thereof or therein.
As used under this heading, "--Payment of Additional Amounts," and
under the headings, "--Redemption for Tax Reasons" and "United States Tax
Considerations," the terms "United States" and "U.S." mean the United States of
America (including the States thereof and the District of Columbia) and its
territories, its possessions and other areas subject to its jurisdiction, and
the term "United States person" means any individual who is a citizen or
resident of the United States, a corporation, partnership or other entity
created or organized in or under the laws of the United States, any State
thereof or the District of Columbia (other than a partnership that is not
treated as a United States person under any applicable United States Treasury
regulations), any estate the income of which is subject to United States federal
income taxation regardless of its source, or any trust if a court within the
United States is able to exercise primary supervision over the administration of
the trust and one or more United States persons have the authority to control
all substantial decisions of the trust. Notwithstanding the preceding sentence,
to the extent provided in the Treasury regulations, certain trusts in existence
on August 20, 1996, and treated as United States persons prior to such date that
elect to continue to be treated as United States persons, will also be United
States persons. A "non-United States person" means a person who is not a United
States person.
Redemption for Tax Reasons
If, as a result of any change in, or amendment to, the laws (or any
regulations or rulings promulgated thereunder) of the United States (or any
political subdivision or taxing authority thereof or therein), or any change in,
or amendments to, an official position regarding the application or
interpretation of such laws, regulations or rulings, which change or amendment
is announced or becomes
35
effective on or after the date of this prospectus, we become or, based upon a
written opinion of independent counsel selected by us, will become obligated to
pay additional amounts as described herein under the heading "Payment of
Additional Amounts" with respect to a series of senior securities, we may, at
our option, redeem, as a whole, but not in part, the relevant series of senior
securities on not less than 30 nor more than 60 days' prior notice, at a
redemption price equal to 100% of their principal amount together with interest
accrued but unpaid thereon to the date fixed for redemption.
Merger, Consolidation or Sale of Assets
Under the terms of the Indenture, we and Viacom International generally
would be permitted to consolidate or merge with another corporation. We and
Viacom International would also be permitted to sell all or substantially all of
our assets to another person. However, neither we nor Viacom International may
take any of these actions unless allindenture contains the following conditions are met:
(1) the merger, consolidation or sale of assets must not cause an
Event of Default. See "-- Defaults and Remedies" below. An Event of Default
for this purpose would also include any event that would be an Event of
Default if the notice or time requirements were disregarded;
(2) the person we would merge or consolidate with or sell all or
substantially all of our assets to must be organized under the laws of the
United States or any state thereof;
(3) the person we would merge or consolidate with or sell all or
substantially all of our assets to must agree to be legally responsible for
the outstanding securities issued under the Indenture; and
(4) we or Viacom International must deliver specified certificates and
documents to the trustee.
We and Viacom International may merge or consolidate with, or sell all
or substantially all of our assets to each other or any of our Subsidiaries.
When we make reference in this section to the sale of " all or substantially all
of our assets," we mean property and assets generating revenues representing, in
the aggregate, at least 80% of our total consolidated revenues.
covenants:
Limitations on Liens
We covenant in the Indentureindenture that we will not create, assume or permit any Lien on any of our propertiesproperty or assets, unless we secure the senior
securitiesexchange notes at least equally and ratably towith the secured Indebtedness. The foregoing applies only applies to Liens that in the aggregate exceed 15% of our total consolidated assets, reduced by the Attributable Debt related to any permitted sale and leaseback arrangement. See "-- “—Limitations on Sale and Leaseback Transactions"Transactions” below. The restrictions do not apply to Capitalized Leases or to Indebtedness that is secured by:
(1)
Liens existing in the case of the unregistered 2006 senior notes
and the exchange 2006 senior notes, on the date the unregistered 2006
senior notes are issued, and in the case of the unregistered 2010 senior
notes, the exchange 2010 senior notes, and the unregistered senior
debentures and the exchange senior debentures, on August 1, 2000;
(2) issued;
Liens on any property or any Indebtedness of a person existing at the time the person becomes a Subsidiary (whether by acquisition or otherwise, including through merger or consolidation);
(3)
Liens in favor of us or our Subsidiaries; and
(4)
Liens existing at the time of acquisition of the assets secured thereby and purchase money Liens.
The restrictions also do not apply to extensions, renewals or replacements of any of the foregoing types of Liens.
Limitations on Sale and Leaseback Transactions
We covenant in the Indentureindenture that neither we nor any Restricted Subsidiary will enter into any arrangement with any person to lease a Principal Property (except for any arrangements that exist in the case of the 2006 senior
notes, on the date the seniorexchange notes are issued and in the case of the 2010
senior notes and the senior debentures, on August 1, 2000; or that exist at the time any person that owns a Principal Property becomes a Restricted Subsidiary) which has been or is to be sold or transferred by us or the Restricted Subsidiary to the Personthat person unless:
(1)
the sale and leaseback arrangement involves a lease for a term of not more than three years;
(2)
the sale and leaseback arrangement is entered into between us and any Subsidiary or between our Subsidiaries;
36
(3)
we or the Restricted Subsidiary would be entitled to incur indebtedness secured by a Lien on the Principal Property at least equal in amount to the Attributable Debt permitted pursuant to the first paragraph under "Limitations“—Limitations on Liens"Liens” above without having to secure equally and ratably securing the senior securities;
(4) exchange notes;
the proceeds of the sale and leaseback arrangement are at least equal to the fair market value thereof (as determined by our Boardboard of Directorsdirectors in good faith) of the property and we apply within 180 days after the sale we apply an amount equal to the greater of the net proceeds of the sale or the Attributable Debt associated with respect to the propertysale and leaseback arrangement to either (or a combination of) (i) the retirement of long-term debt for borrowed money that is not subordinated to the senior
securitiesexchange notes and that is not debt to us or a Subsidiary or (ii) the purchase, construction or development of other comparable property; or
(5)
the sale and leaseback arrangement is entered into within 180 days after the initial acquisition by us or such Restricted Subsidiary of the Principal Property subject to the sale and leaseback arrangement.
Merger, Consolidation or Sale of Assets
Under the terms of the indenture, CBS Corporation and CBS Operations generally are permitted to consolidate or merge with or into another corporation, or to sell or convey all or substantially all of their respective property and assets to another entity, subject to CBS Corporation and CBS Operations meeting all of the following conditions:
the surviving entity in the transaction (if other than CBS Corporation or CBS Operations), or the entity to which such property or assets are sold or conveyed (if other than CBS Corporation or CBS Operations), must be a corporation organized under the laws of the United States or a state of the United States;
the resulting entity (other than CBS Corporation or CBS Operations) must agree through a supplemental indenture to be legally responsible for the exchange notes;
immediately following the consolidation, merger, sale or conveyance, no Event of Default (as defined below) or any event or condition which is, or after notice or passage of time would be, an Event of Default, shall have occurred and be continuing; and
CBS Corporation or CBS Operations, as the case may be, must deliver certain certificates and other documents to the trustee.
CBS Corporation and/or CBS Operations may consolidate or merge with or into, or sell or convey all or substantially all of its property and assets to, any Subsidiary. When we make reference in this section to the sale or conveyance of “all or substantially all of its property and assets,” we mean property and assets contributing, in the aggregate, at least 80% of the total consolidated revenues of CBS Corporation.
In the event that CBS Corporation or CBS Operations consolidates with or merges into another entity or sells or conveys all or substantially all of its property and assets to another entity, the successor entity shall be substituted for CBS Corporation or CBS Operations, as the case may be, under the indenture and CBS Corporation or CBS Operations, as the case may be, shall be discharged from all of its obligations under the indenture.
Reports
The term "Attributableindenture provides that we will file with the trustee, within 15 days after we file the same with the SEC, copies of the annual reports and of the information, documents and other reports which we may be required to file with the SEC pursuant to Section 13 or Section 15(d) of the Exchange Act.
Any such reports we deliver or file with the trustee will be considered for informational purposes only, and the trustee’s receipt of such reports will not constitute notice or actual knowledge of any information contained therein or determinable from information contained therein, including our compliance with any of the covenants under the indenture (as to which the trustee is entitled to rely exclusively on an officer’s certificate).
Other Covenants
We are not restricted by the indenture from, among other actions, paying dividends or making distributions on our capital stock, purchasing or redeeming our capital stock, making investments, or selling or conveying less than all or substantially all of our property and assets, defined as described above. Further, the indenture does not require us to maintain any financial ratios or specified levels of net worth or liquidity.
Certain Definitions
The following definitions are applicable to the indenture:
“Attributable Debt",” with regard to a sale and leaseback arrangement ofwith respect to a Principal Property, is defined in the Indenture asmeans an amount equal to the lesser of: (a)of (i) the fair market value of the property (as determined in good faith by our Boardboard of Directors); and (b)directors) or (ii) the present value of the total net amount of rent payments required to be made under the lease during its remaining term, discounted at the rate of interest set forth or implicit in the terms of the lease, compounded semi-annually. The calculation of the present value of the total net amount of rent payments is subject to adjustments specified in the Indenture.
The term "Principal Property" is defined in the Indenture to include
any parcel of our or our Restricted Subsidiaries' real property and related
fixtures or improvements located in the United States, the aggregate book value
of which on the date of determination exceeds $1.0 billion. The term "Principal
Property" does not include any telecommunications equipment or parcels of real
property and related fixtures or improvements which are determined in good faith
by our Board of Directors, not to be of
37
material importance to our and our Subsidiaries' total business. As of the date
of this prospectus, neither we nor any of our Subsidiaries own any Principal
Property.
Defaults and Remedies
You have specified rights if an Event of Default occurs in respect of
the senior securities of your series, as described below.
The term "Event of Default" in respect of the senior securities of your
series means any of the following:
(1) we do not pay interest on a senior security of such series within
30 days of its due date;
(2) we do not pay the principal of or any premium on a senior security
of such series on its due date;
(3) we remain in breach of a covenant or warranty in respect of the
Indenture for 60 days after we receive a written notice of default. The
notice must be sent by either the trustee or holders of at least 25% in
principal amount of a series of outstanding senior securities;
(4) we are in default under agreements under which we have
Indebtedness outstanding in excess of $250 million in the aggregate and
which Indebtedness is due either at maturity or has been declared due prior
to maturity and remains unpaid;
(5) we fail to pay a money judgment in excess of $250 million for a
period of 60 days after it becomes final and not subject to further appeal;
or
(6) we or Viacom International file for bankruptcy, or other specified
events of bankruptcy, insolvency or reorganization occur.
If an Event of Default has occurred, the trustee or the holders of at
least 25% in principal amount of the senior securities of the affected series
may declare the entire principal amount and premium, if any, and all the accrued
interest on, the senior securities of that series to be due and immediately
payable. This is called a declaration of acceleration of maturity. There is no
action on the part of the trustee or any holder of senior securities required
for such declaration if the Event of Default is a bankruptcy, insolvency or
reorganization.
Holders of a majority in principal amount of the senior securities of a
series may also waive certain past defaults under the Indenture on behalf of all
of the holders of such series of senior securities. A declaration of
acceleration of maturity may be canceled, under specified circumstances, by the
holders of at least a majority in principal amount of a series of senior
securities.
Except in cases of default, where the trustee has special duties, the
trustee is not required to take any action under the Indenture at the request of
holders unless the holders offer the trustee reasonable protection from expenses
and liability satisfactory to the trustee. If a reasonable indemnity is
provided, the holders of a majority in principal amount of a series of senior
securities may direct the time, method and place of conducting any lawsuit or
other formal legal action seeking any remedy available to the trustee. The
trustee may refuse to follow those directions in specified circumstances. No
delay or omission in exercising any right or remedy will be treated as a waiver
of the right, remedy or Event of Default.
38
Before holders are allowed to bypass the trustee and bring a lawsuit or
other formal legal action or take other steps to enforce their rights or protect
their interests relating to the senior securities, the following must occur:
o holders must give the trustee written notice that an Event of Default
has occurred and remains uncured;
o holders of at least 25% in principal amount of the outstanding senior
securities of a series must make a written request that the trustee
take action because of the default and must offer the trustee
indemnity satisfactory to the trustee against the cost and other
liabilities of taking that action;
o The trustee must have failed to take action for 60 days after receipt
of the notice and offer of indemnity; and
o holders of a majority in principal amount of the senior securities of
a series must not have given the trustee a direction inconsistent with
the above notice.
However, you are entitled at any time to bring a lawsuit for the
payment of money due on your senior securities on or after the due date.
We are required to furnish to the trustee an annual statement as to our
performance of our obligations under the Indenture and as to any default in such
performance. We are also required to notify the trustee of any event that is, or
after notice or lapse of time or both would become, an Event of Default.
Book Entry, Delivery and Form
Each series of senior securities will be issued in one or more fully
registered global securities which will be deposited with, or on behalf of, The
Depository Trust Company, New York, New York (the "Depository") and registered
in the name of Cede & Co., the Depository's nominee. We will not issue senior
securities in certificated form. Beneficial interests in the global securities
will be represented through book-entry accounts of financial institutions acting
on behalf of beneficial owners as direct and indirect participants in the
Depository (the "Depository Participants"). Investors may elect to hold
interests in the global securities through either the Depository (in the United
States), or Clearstream Luxembourg or Euroclear (in Europe) if they are
participants of those systems, or, indirectly, through organizations that are
participants in those systems. Clearstream Luxembourg and Euroclear will hold
interests on behalf of their participants through customers' securities accounts
in Clearstream Luxembourg's and Euroclear's names on the books of their
respective depositaries, which in turn will hold such interests in customers'
securities accounts in the depositaries' names on the books of the Depository.
At the present time, Citibank, N.A. acts as U.S. depositary for Clearstream
Luxembourg and The Chase Manhattan Bank acts as U.S. depositary for Euroclear
(the "U.S. Depositaries"). Beneficial interests in the global securities will be
held in denominations of $1,000 and integral multiples thereof. Except as set
forth below, the global securities may be transferred, in whole but not in part,
only to another nominee of the Depository or to a successor of the Depository or
its nominee. Clearstream Luxembourg has advised us that it is incorporated under
the laws of Luxembourg as a professional depositary. Clearstream Luxembourg
holds securities for its participating organizations ("Clearstream Luxembourg
Participants") and facilitates the clearance and settlement of securities
transactions between Clearstream Luxembourg Participants through electronic
book-entry changes in accounts of Clearstream Luxembourg Participants, thereby
eliminating the need for physical movement of certificates.
39
Clearstream Luxembourg provides to Clearstream Luxembourg Participants,
among other things, services for safekeeping, administration, clearance and
settlement of internationally traded securities and securities lending and
borrowing. Clearstream Luxembourg interfaces with domestic markets in several
countries. As a professional depositary, Clearstream Luxembourg is subject to
regulation by the Luxembourg Monetary Institute. Clearstream Luxembourg
Participants are recognized financial institutions around the world, including
underwriters, securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations and may include the initial
purchasers or their affiliates. Indirect access to Clearstream Luxembourg is
also available to others, such as banks, brokers, dealers and trust companies
that clear through, or maintain a custodial relationship with, a Clearstream
Luxembourg Participant either directly or indirectly.
Distributions with respect to each series of senior securities held
beneficially through Clearstream Luxembourg will be credited to cash accounts of
Clearstream Luxembourg Participants in accordance with its rules and procedures,
to the extent received by the U.S. Depositary for Clearstream Luxembourg.
Euroclear has advised us that it was created in 1968 to hold securities
for participants of Euroclear ("Euroclear Participants") and to clear and settle
transactions between Euroclear Participants through simultaneous electronic
book-entry delivery against payment, thereby eliminating the need for physical
movement of certificates and any risk from lack of simultaneous transfers of
securities and cash. Euroclear includes various other services, including
securities lending and borrowing and interfaces with domestic markets in several
countries. Euroclear is operated by the Brussels, Belgium office of Morgan
Guaranty Trust Company of New York (the "Euroclear Operator"), under contract
with Euroclear Clearance Systems S.C., a Belgian cooperative corporation (the
"Cooperative"). All operations are conducted by the Euroclear Operator, and all
Euroclear securities clearance accounts and Euroclear cash accounts are accounts
with the Euroclear Operator, not the Cooperative. The Cooperative establishes
policy for Euroclear on behalf of Euroclear Participants. Euroclear Participants
include banks (including central banks), securities brokers and dealers and
other professional financial intermediaries and may include the initial
purchasers or their affiliates. Indirect access to Euroclear is also available
to other firms that clear through or maintain a custodial relationship with a
Euroclear Participant, either directly or indirectly. The Euroclear Operator is
the Belgian branch of a New York banking corporation, which is a member bank of
the Federal Reserve System. As such, it is regulated and examined by the Board
of Governors of the Federal Reserve System, the New York State Banking
Department and the Belgian Banking Commission.
Securities clearance accounts and cash accounts with the Euroclear
Operator are governed by the Terms and Conditions Governing Use of Euroclear and
the related Operating Procedures of the Euroclear System, and applicable Belgian
law (the "Terms and Conditions"). The Terms and Conditions govern transfers of
securities and cash within Euroclear, withdrawals of securities and cash from
Euroclear, and receipts of payments with respect to securities in Euroclear. All
securities in Euroclear are held on a fungible basis without attribution of
specific certificates to specific securities clearance accounts. The Euroclear
Operator acts under the Terms and Conditions only on behalf of Euroclear
Participants, and has no record of, or relationship with, persons holding
through Euroclear Participants.
Distributions with respect to each series of senior securities held
beneficially through Euroclear will be credited to the cash accounts of
Euroclear Participants in accordance with the Terms and Conditions, to the
extent received by the U.S. Depositary for Euroclear.
Global Clearance and Settlement Procedures
Secondary market trading between Depository Participants will occur in
the ordinary way in accordance with the Depository's rules and will be settled
in immediately available funds using the
40
Depository's Same-Day Funds Settlement System. Secondary market trading between
Clearstream Luxembourg Participants and Euroclear Participants will occur in the
ordinary way in accordance with the applicable rules and operating procedures of
Clearstream Luxembourg and Euroclear and will be settled using the procedures
applicable to conventional eurobonds in immediately available funds.
Cross-market transfers between persons holding directly or indirectly
through the Depository on the one hand, and directly or indirectly through
Clearstream Luxembourg or Euroclear Participants, on the other, will be effected
within the Depository in accordance with the Depository's rules on behalf of the
relevant European international clearing system by its U.S. Depository; however,
such cross-market transactions will require delivery of instructions to the
relevant European international clearing system by the counterparty in such
system in accordance with its rules and procedures and within its established
deadlines (European time).
The relevant European international clearing system will, if the
transaction meets its settlement requirements, deliver instructions to its U.S.
Depositary to take action to effect final settlement on its behalf by delivering
or receiving senior securities in the Depository, and making or receiving
payment in accordance with normal procedures for same-day funds settlement
applicable to the Depository. Clearstream Luxembourg Participants and Euroclear
Participants may not deliver instructions directly to their respective U.S.
Depositaries.
Because of time-zone differences, credits of senior securities received
in Clearstream Luxembourg or Euroclear as a result of a transaction with a
Depository Participants will be made during subsequent securities settlement
processing and dated the business day following the Depository settlement date.
Such credits, or any transactions in the senior securities settled during such
processing, will be reported to the relevant Euroclear Participants or
Clearstream Luxembourg Participants on that business day. Cash received in
Clearstream Luxembourg or Euroclear as a result of sales of senior securities by
or through a Clearstream Luxembourg Participant or a Euroclear Participant to a
Depository Participant will be received with value on the business day of
settlement in the Depository but will be available in the relevant Clearstream
Luxembourg or Euroclear cash account only as of the business day following
settlement in the Depository.
Although the Depository, Clearstream Luxembourg and Euroclear have
agreed to the foregoing procedures in order to facilitate transfers of
securities among participants of the Depository, Clearstream Luxembourg and
Euroclear, they are under no obligation to perform or continue to perform such
procedures and they may discontinue the procedures at any time.
Payment and Paying Agents
Principal of, premium, if any, and interest on the senior securities
will be payable, subject to any applicable laws and regulations, at the office
of our paying agent or paying agents that we may designate from time to time,
except that at our option, payment of interest may be made by check mailed to
the address of the person entitled thereto at the address in the security
register. We will pay interest on the senior securities on any interest payment
date to the person in whose name the senior security (or predecessor senior
security) is registered at the close of business on the regular record date for
such interest.
The corporate trust office of the trustee will be designated as our
paying agent for payments with respect to the senior securities of each series.
We may at any time designate additional paying agents or rescind the designation
of any paying agent or approve a change in the office through which any paying
agent acts, except that we will be required to maintain a paying agent in each
place of payment for the series.
41
Any money paid by us or Viacom International, as guarantor, to a paying
agent for the payment of the principal of, premium, if any, or interest on any
senior security of any series that remains unclaimed at the end of two years
after such principal, premium or interest has become due and payable will be
repaid to us or Viacom International, as guarantor, as the case may be, and the
holder of such senior security may thereafter look only to us and Viacom
International for that payment.
Meetings, Modification and Waiver
Modifications and amendments of the Indenture may be made by us, Viacom
International, as guarantor, and the trustee with the consent of the holders of
not less than a majority in aggregate principal amount of the outstanding senior
securities of each series affected by such modification or amendment; provided,
however, that no such modification or amendment may, without the consent of the
holders of each outstanding senior security affected thereby, (a) change the
stated maturity of the principal of, or any installment of principal of or
interest on, any senior security or the terms of any sinking fund or analogous
payment with respect to any senior security, (b) reduce the principal amount of,
or premium or interest on, any senior security, (c) change our obligation to pay
additional amounts, (d) reduce the amount of principal of an original issue
discount senior security payable upon acceleration of the maturity thereof or
provable in bankruptcy, (e) change the place of payment where, or the coin or
currency in which, any senior security or any premium or interest thereon is
payable, (f) impair the right to institute suit for the enforcement of any
payment on or with respect to any senior security, (g) reduce the percentage in
principal amount of outstanding senior securities of any series, the consent of
whose holders is required for modification or amendment of the Indenture or for
waiver of compliance with certain provisions of the Indenture or for waiver of
certain defaults, (h) reduce the requirements contained in the Indenture for
quorum or voting, (i) change our obligation to maintain an office or agency in
the places and for the purposes required by the Indenture, or (j) reduce the
obligations of Viacom International, if any, in respect of the due and punctual
payment of any principal of, premium or interest on any senior security or any
additional amounts in respect thereof.
The holders of at least a majority in aggregate principal amount of the
outstanding senior securities of a series may, on behalf of the holders of all
the senior securities of that series, waive, insofar as that series is
concerned, our compliance with specified provisions of the Indenture. The
holders of not less than a majority in aggregate principal amount of the
outstanding senior securities of a series may, on behalf of all holders of
senior securities of that series, waive any past default under the Indenture
with respect to senior securities of that series, except a default (a) in the
payment of principal of or any premium or interest on any senior security of
such series or (b) in respect of any other provision of the Indenture that
cannot be modified or amended without the consent of the holder of each
outstanding senior security of such series affected thereby.
The Indenture provides that, in determining whether the holders of the
requisite principal amount of the outstanding senior securities have given any
request, demand, authorization, direction, notice, consent or waiver thereunder
or are present at a meeting of holders of senior securities for quorum purposes,
the principal amount of an original issue discount senior security that shall be
deemed to be outstanding shall be the amount that would be due and payable as of
the date of such determination upon acceleration of the maturity thereof.
The Indenture contains provisions for convening meetings of the holders
of senior securities of any or all series. A meeting may be called at any time
by the trustee, and also, upon request, by us or the holders of at least 33 1/3%
in aggregate principal amount of the outstanding senior securities of such
series, in any such case upon notice given in accordance with "Notices" below.
Except for any consent that must be given by the holder of each outstanding
senior security affected thereby, as described above, any resolution presented
at a meeting or adjourned meeting at which a quorum is present may be adopted
42
by the affirmative vote of the holders of a majority in principal amount of the
outstanding senior securities of that series; provided, however, that, except
for any consent that must be given by the holder of each outstanding senior
security affected thereby, as described above, any resolution with respect to
any consent, waiver, request, demand, notice, authorization, direction or other
action that may be made, given or taken by the holders of not less than a
specified percentage in principal amount of the outstanding senior securities of
a series may be adopted at a meeting or an adjourned meeting at which a quorum
is present only by the affirmative vote of the holders of not less than such
specified percentage in principal amount of the outstanding senior securities of
that series.
Any resolution passed or decision taken at any meeting of holders of
senior securities of any series duly held in accordance with the Indenture will
be binding on all holders of senior securities of that series. The quorum at any
meeting called to adopt a resolution, and at any adjourned meeting, will be
persons holding or representing a majority in principal amount of the
outstanding senior securities of a series; provided, however, that, if any
action is to be taken at such meeting with respect to a consent, waiver,
request, demand, notice, authorization, direction or other action that may be
given by the holders of not less than a specified percentage in principal amount
of the outstanding senior securities of a series, the persons holding or
representing such specified percentage in principal amount of the outstanding
senior securities of such series will constitute a quorum.
Defeasance and Covenant Defeasance
We may elect either (i) to defease and be discharged (and, if
applicable, to have Viacom International defeased and discharged) from any and
all obligations with respect to the senior securities (except as otherwise
provided in the Indenture) ("defeasance") or (ii) to be released from its
obligations with respect to certain covenants that are described in the
Indenture ("covenant defeasance"), upon the deposit with the trustee, in trust
for such purpose, of money and/or specified government obligations that through
the payment of principal and interest in accordance with their terms will
provide money in an amount sufficient, without reinvestment, to pay the
principal of, premium, if any and interest on the senior securities of such
series to maturity or redemption, as the case may be, and any mandatory sinking
fund or analogous senior payments thereon. As a condition to defeasance or
covenant defeasance, we must deliver to the trustee an opinion of counsel to the
effect that the holders of the senior securities of such series will not
recognize income, gain or loss for United States federal income tax purposes as
a result of such defeasance or covenant defeasance and will be subject to United
States federal income tax on the same amounts, in the same manner and at the
same times as would have been the case if such defeasance or covenant defeasance
had not occurred. Such opinion of counsel, in the case of defeasance under
clause (i) above, must refer to and be based upon a ruling of the Internal
Revenue Service or a change in applicable United States federal income tax law
occurring after the date of the Indenture.
We may exercise our defeasance option with respect to the senior
securities of any series notwithstanding its prior exercise of our covenant
defeasance option. If we exercise our defeasance option, payment of the senior
securities of such series may not be accelerated because of an event of default
and the guarantees relating to such senior securities will cease to exist. If we
exercise our covenant defeasance option, payment of the senior securities of
such series may not be accelerated by reference to any covenant from which we
are released as described under clause (ii) above. However, if acceleration were
to occur for other reasons, the realizable value at the acceleration date of the
money and government obligations in the defeasance trust could be less than the
principal and interest then due on the senior securities of such series, in that
the required deposit in the defeasance trust is based upon scheduled cash flows
rather than market value, which will vary depending upon interest rates and
other factors.
43
Notices
Notices to holders of senior securities will be given by mail to the
addresses of such holders as they appear in the security register.
Title
We, Viacom International, as guarantor, the trustee and any agent of
us, Viacom International, as guarantor, or the trustee may treat the registered
owner of any registered senior security as the absolute owner thereof (whether
or not the senior security shall be overdue and notwithstanding any notice to
the contrary) for the purpose of making payment and for all other purposes.
Replacement of Senior Securities
We will replace any mutilated senior security at the expense of the
holders upon surrender to the trustee. We will replace senior securities that
become destroyed, lost or stolen at the expense of the holder upon delivery to
the trustee of satisfactory evidence of the destruction, loss or theft thereof.
In the event of a destroyed, lost or stolen senior security, an indemnity
satisfactory to us and the trustee may be required at the expense of the holder
of the senior security before a replacement senior security will be issued.
Governing Law
The Indenture, the senior securities and the guarantees will be
governed by, and construed in accordance with, the laws of the State of New
York.
Regarding the Trustee
We and Viacom International maintain deposit accounts and banking and
borrowing relations with Citibank, NA, the trustee under the Indenture, and such
trustee is currently a lender to us and Viacom International and certain of our
other subsidiaries. We may remove the trustee at any time with respect to the
senior securities of any series, provided that we immediately appoint a
successor trustee meeting the requirements for trustees specified in the
Indenture and provided further that no default with respect to such senior
securities has occurred and is continuing.
Certain Definitions
The following definitions are applicable to the Indenture:
"Capitalized Lease"indenture.
“Capitalized Lease” means any obligation of a person to pay rent or other amounts incurred with respect to real property or equipment acquired or leased by such person and used in its business that is required to be recorded as a capital lease in accordance with generally accepted accounting principles consistently applied as in effect from time to time.
"Indebtedness"
“Indebtedness” of any person means, without duplication, (i) any obligation of such person for money borrowed, (ii) any obligation of such person evidenced by bonds, debentures, notes or other similar instruments, (iii) any reimbursement obligation of such person in respect of letters of credit or other similar instruments which support financial obligations which would otherwise become Indebtedness, (iv) any obligation of such person under Capitalized Leases (other than in respect of (x) telecommunications equipment, including, without limitation, satellite transponders, and (y) theme park equipment and attractions), and (v) any obligation of any third party to the extent secured by a Lien 44
"Indebtedness"“Indebtedness” of such person shall not include any obligation of such person (a) to any Subsidiary of such person or to any person with respect to which such person is a Subsidiary or (b) specifically with respect to the production, distribution or acquisition of motion pictures or other programming rights, talent or publishing rights. When used with respect to Viacom,CBS Corporation, the term "Indebtedness"“Indebtedness” also includes any obligation of Viacom InternationalCBS Operations specified in clauses (i) through (v) above to the extent that saidsuch Indebtedness is guaranteed by Viacom.
"Lien"CBS Corporation.
“Lien” means any pledge, mortgage, lien, encumbrance or other security interest.
"Restricted Subsidiary"
“Principal Property” means any parcel of our or our Restricted Subsidiaries’ real property and related fixtures or improvements located in the United States, the aggregate book value of which on the date of determination exceeds $1.0 billion. The term “Principal Property” does not include any telecommunications equipment or parcels of real property and related fixtures or improvements that are determined in good faith by our board of directors not to be of material importance to our and our Subsidiaries’ total business. As of the date of this prospectus, neither we nor any of our Subsidiaries own any Principal Property.
“Restricted Subsidiary” means a corporation, all of the outstanding voting stock of which is owned, directly or indirectly, by ViacomCBS Corporation or by one or more of its Subsidiaries, or by ViacomCBS Corporation and one or more of its Subsidiaries, which is incorporated under the laws of a Statestate of the United States, and which owns a Principal Property.
"Subsidiary"
“Subsidiary” of any person means (i) a corporation, a majority of the outstanding voting stock of which is at the time, directly or indirectly, owned by such person, by one or more Subsidiaries of such person, or by such person and one or more Subsidiaries thereof or (ii) any other person (other than a corporation), including, without limitation, a partnership or joint venture, in which such person, one or more Subsidiaries thereof, or such person and one or more Subsidiaries thereof, directly or indirectly, at the date of determination thereof, has at least majority ownership interest entitled to vote in the election of directors, managers or trustees thereof (or other persons performing similar functions).
45
UNITED STATES
Defaults and Remedies
Holders of exchange notes will have specified rights if an Event of Default occurs in respect of the exchange notes of that series, as described below.
The term “Event of Default” in respect of the exchange notes of a particular series means any of the following:
CBS Corporation does not pay interest on an exchange note of such series within 30 days of its due date;
CBS Corporation does not pay the principal of or any premium on an exchange note of such series when due and payable, at its maturity, or upon its acceleration, redemption or otherwise;
CBS Corporation remains in default or breach of certain covenants or warranties in respect of the indenture for 60 days after there has been given to CBS Corporation a written notice of such default or breach by either the trustee or holders of at least 25% in principal amount of such series of exchange notes; or
CBS Corporation or CBS Operations files for bankruptcy, or certain events of bankruptcy, insolvency or reorganization in respect of CBS Corporation or CBS Operations as specified in the indenture occur.
If an Event of Default has occurred, the trustee or the holders of at least 25% in principal amount of the exchange notes of the affected series may declare the entire unpaid principal amount of (and premium, if any) and all the accrued interest on the exchange notes of that series to be due and immediately payable. This is called a declaration of acceleration of maturity. There is no action on the part of the trustee or any holder of exchange notes required for such declaration if the Event of Default is an event of bankruptcy, insolvency or reorganization. Holders of a majority in principal amount of the exchange notes of a series may waive certain past defaults under the indenture on behalf of all of the holders of such series of exchange notes. A declaration of acceleration of maturity may be canceled, under specified circumstances, by the holders of at least a majority in principal amount of a series of exchange notes and the trustee.
Except in cases of default, where the trustee has special duties, a trustee is not required to take any action under the indenture at the request of holders unless the holders offer the trustee security or indemnity satisfactory to the trustee. If such an indemnity is provided, the holders of a majority in principal amount of a series of exchange notes may direct the time, method and place of conducting any lawsuit or other formal legal action seeking any remedy available to the trustee. The trustee may refuse to follow those directions in certain circumstances specified in the indenture. No delay or omission in exercising any right or remedy will be treated as a waiver of the right, remedy or Event of Default.
Before holders of exchange notes of an affected series are allowed to bypass the trustee and bring a lawsuit or other formal legal action or take other steps to enforce their rights or protect their interests relating to the exchange notes of such series, the following must occur:
holders must give the trustee written notice that an Event of Default has occurred and remains uncured;
holders of at least 25% in principal amount of the outstanding exchange notes of such series must make a written request that the trustee take action because of the default and must offer the trustee indemnity reasonably satisfactory to the trustee against the cost and other liabilities of taking that action;
the trustee must have failed to take action for 60 days after receipt of the notice and offer of indemnity; and
holders of a majority in principal amount of the exchange notes of such series must not have given the trustee a direction inconsistent with the above notice for a period of 60 days after the trustee has received the notice.
Holders are, however, entitled at any time to bring a lawsuit for the payment of money due on the exchange notes on or after the due date.
CBS Corporation and CBS Operations will each be required to deliver to the trustee on an annual basis an officer’s certificate certifying to such officer’s knowledge our compliance with the terms of the indenture or else specifying any default. In addition, CBS Corporation will be required to deliver to the trustee, as promptly as practicable upon becoming aware of any default or Event of Default, an officer’s certificate specifying such default or Event of Default and the action CBS Corporation is taking or proposes to take with respect thereto.
Modification of Indenture
The indenture provides that CBS Corporation, CBS Operations and the trustee may, without notice to or the consent of any holders of exchange notes, enter into supplemental indentures for the purposes, among others, of:
adding to CBS Corporation’s or CBS Operations’ covenants;
adding additional Events of Default;
changing or eliminating any provisions of the indenture so long as there are no holders entitled to the benefit of the provisions;
establishing the form or terms of any series of senior notes; or
curing ambiguities, omissions, mistakes, defects or inconsistencies in the indenture or making any other changes to provisions of the indenture, as long as any such action does not adversely affect in any material respect the interest of the holders of exchange notes of any series.
With specific exceptions, the indenture or the rights of the holders of the exchange notes may be modified by CBS Corporation, CBS Operations and the trustee with the consent of the holders of a majority in aggregate principal amount of the exchange notes of each series affected by the modification then outstanding, but no modification may be made without the consent of the holders of each outstanding exchange note affected, among other purposes requiring such consent, which would:
change the maturity of any payment of principal of (or premium, if any, on) or any installment of principal of or interest on any exchange note;
change the terms of any sinking fund with respect to any exchange note;
reduce the principal amount of, or the rate of interest or any premium on, any exchange note upon redemption or repayment at the option of the holder;
change any obligation of CBS Corporation to pay additional amounts as contemplated by the indenture;
change any place of payment where, or the currency in which, any exchange note or any premium or interest is payable;
impair the right to sue for the enforcement of any payment on or with respect to any exchange note;
reduce the percentage in principal amount of outstanding exchange notes of any series required to consent to any supplemental indenture, any waiver of compliance with provisions of the indenture or specific defaults and their consequences provided for in the indenture, or otherwise modify the sections in the indenture related to these consents; or
reduce the obligations of CBS Operations, if any, in respect of the due and punctual payment of principal of, premium, if any, and interest, if any, on any exchange note.
Defeasance and Covenant Defeasance
CBS Corporation may elect either (i) to defease and be discharged (and, if applicable, to have CBS Operations defeased and discharged) from any and all obligations with respect to the exchange notes (except as otherwise provided in the indenture), referred to as “defeasance,” or (ii) to be released from its obligations with respect to certain covenants that are described in the indenture, referred to as “covenant defeasance,” upon the deposit with the trustee, in trust for such purpose, of money and/or government obligations that through the payment of principal and interest in accordance with their terms will provide money in an amount sufficient, without reinvestment, to pay the principal of (and premium, if any, on) and interest on the exchange notes of such series to maturity or redemption, as the case may be, and any mandatory sinking fund or analogous senior payments thereon. As a condition to defeasance or covenant defeasance, CBS Corporation must deliver to the trustee an opinion of counsel to the effect that the holders of the exchange notes of such series will not recognize income, gain or loss for United States federal income tax purposes as a result of such defeasance or covenant defeasance and will be subject to United States federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such defeasance or covenant defeasance had not occurred. Such opinion of counsel, in the case of defeasance under clause (i) above, must refer to and be based upon a ruling of the Internal Revenue Service or a change in applicable United States federal income tax law occurring after the date of the indenture.
CBS Corporation may exercise its defeasance option with respect to the exchange notes of any series notwithstanding its prior exercise of its covenant defeasance option. If CBS Corporation exercises its defeasance option, payment of the exchange notes of such series may not be accelerated because of an event of default and the guarantees relating to such exchange notes will cease to exist. If CBS Corporation exercises its covenant defeasance option, payment of the exchange notes of such series may not be accelerated by reference to any covenant from which CBS Corporation is released as described under clause (ii) above. However, if acceleration were to occur for other reasons, the realizable value at the acceleration date of the money and government obligations in the defeasance trust could be less than the principal and interest then due on the exchange notes of such series, in that the required deposit in the defeasance trust is based upon scheduled cash flows rather than market value, which will vary depending upon interest rates and other factors.
Discharge of Obligations
Our obligations under the indenture will cease to be of further effect with respect to a series of exchange notes when:
either (i) all exchange notes of that series have been delivered (except destroyed, lost or stolen exchange notes which have been replaced or paid and exchange notes for which payment money has theretofore been deposited in trust with the trustee or paying agent or segregated and held in trust by
CBS Corporation or CBS Operations, as the case may be, and thereafter repaid to us or CBS Operations, as the case may be, or discharged from such trust in accordance with the indenture) to the trustee for cancellation, or (ii) all such exchange notes not theretofore delivered to the trustee for cancellation have become due and payable, will become due and payable at maturity within one year or are to be called for redemption within one year under arrangements satisfactory to the trustee for the giving of notice of redemption and CBS Corporation has deposited or caused to be deposited with the trustee, in trust, an amount sufficient to pay and discharge the entire indebtedness on such exchange notes not theretofore delivered to the trustee for cancellation, for principal (and premium, if any) and interest, if any, to the date of maturity or date of redemption, as the case may be; |
we have paid or caused to be paid all sums payable by us under the indenture with respect to such series; and
we have delivered to the trustee an officer’s certificate and an opinion of counsel relating to compliance with the conditions set forth in the indenture.
Notices
Notices to holders of exchange notes will be given as provided in the indenture to the addresses of such holders as they appear in the security register.
Meetings
The indenture contains provisions for convening meetings of the holders of the exchange notes of any or all series. Specific terms related to such meetings of the holders will be set forth in the indenture.
Title
CBS Corporation, CBS Operations, as guarantor, the trustee and any agent of any of the foregoing may treat the registered owner of any registered exchange note as the absolute owner thereof (whether or not the exchange note shall be overdue and notwithstanding any notice to the contrary) for the purpose of receiving payment and for all other purposes.
Replacement of Exchange Notes
We will replace any mutilated exchange note at the expense of the holder upon surrender thereof to the trustee. We will replace exchange notes that become destroyed, lost or stolen at the expense of the holder upon delivery to the trustee of satisfactory evidence of the destruction, loss or theft thereof. In the event of a mutilated, destroyed, lost or stolen exchange note, an indemnity or security satisfactory to us and the trustee may be required at the expense of the holder of the exchange note before a replacement exchange note will be issued.
Form and Title
The exchange notes will be issued in the form of one or more fully registered global notes which will be deposited with, or on behalf of, DTC, as the depositary, and registered in the name of Cede & Co., DTC’s nominee. Beneficial interests in the global notes will be represented through book-entry accounts of financial institutions acting on behalf of beneficial owners as direct and indirect participants in DTC. Investors may elect to hold interests in the global notes through either DTC (in the United States), Clearstream Banking,société anonyme, which we refer to as “Clearstream Luxembourg,” or Euroclear Bank S.A./N.V., as operator of the Euroclear System (outside of the United States), if they are participants in these systems, or indirectly through organizations which are participants in these systems. Clearstream Luxembourg and Euroclear will hold interests on behalf of their participants through customers’ securities accounts in Clearstream Luxembourg’s and Euroclear’s names on the books of their respective depositaries, which in turn will hold these interests in
customers’ securities accounts in the names of their respective U.S. depositaries on the books of DTC. Except under circumstances described below, the exchange notes will not be issuable in definitive form. The laws of some states require that certain purchasers of securities take physical delivery of their securities in definitive form. These limits and laws may impair the ability to transfer beneficial interests in the global notes.
So long as the depositary or its nominee is the registered owner of the global notes, the depositary or its nominee will be considered the sole owner or holder of the exchange notes represented by the global notes for all purposes under the indenture. Except as provided in the indenture, owners of beneficial interests in the global notes will not be entitled to have exchange notes represented by the global notes registered in their names, will not receive or be entitled to receive physical delivery of exchange notes in definitive form and will not be considered the owners or holders thereof under the indenture.
Principal and interest payments on exchange notes registered in the name of the depositary or its nominee will be made to the depositary or its nominee, as the case may be, as the registered owner of the global notes. None of us, the trustee, any paying agent or registrar for the exchange notes will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial interests in the global notes or for maintaining, supervising or reviewing any records relating to these beneficial interests.
We expect that the depositary for the exchange notes or its nominee, upon receipt of any payment of principal or interest, will credit the participants’ accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of the global notes as shown on the records of the depositary or its nominee. We also expect that payments by participants to owners of beneficial interest in the global notes held through these 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 these participants.
Clearing Systems
DTC. The depositary has advised the financial community as follows: The depositary is a limited-purpose trust company organized under the New York Banking Law, a “banking organization” within the meaning of the New York Banking Law, a member of the Federal Reserve System, a “clearing corporation” within the meaning of the New York Uniform Commercial Code, and a “clearing agency” registered pursuant to the provisions of Section 17A of the Exchange Act. The depositary holds securities deposited with it by its participants and facilitates the settlement of transactions among its participants in such securities through electronic computerized book-entry changes in accounts of the participants, thereby eliminating the need for physical movement of securities certificates. The depositary’s participants include securities brokers and dealers (including the underwriters), banks, trust companies, clearing corporations and certain other organizations, some of which (and/or their representatives) own the depositary. Access to the depositary’s book-entry system is also available to others, such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, either directly or indirectly.
According to the depositary, the foregoing information with respect to the depositary has been provided to the financial community for informational purposes only and is not intended to serve as a representation, warranty or contract modification of any kind.
Clearstream Luxembourg. Clearstream Luxembourg has advised the financial community that it is incorporated under the laws of Luxembourg as a professional depositary. Clearstream Luxembourg holds securities for its participating organizations and facilitates the clearance and settlement of securities transactions between Clearstream Luxembourg participants through electronic book-entry changes in accounts of Clearstream Luxembourg participants, thereby eliminating the need for physical movement of certificates. Clearstream Luxembourg provides to Clearstream Luxembourg participants, among other services, services for safekeeping, administration, clearance and settlement of internationally traded securities and securities lending and borrowing. Clearstream Luxembourg interfaces with domestic markets in several countries. As a registered bank in
Luxembourg, Clearstream Luxembourg is subject to regulation by the Luxembourg Commission for the Supervision of the Financial Sector. Clearstream Luxembourg participants are recognized financial institutions around the world, including underwriters, securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations and may include the underwriters. Indirect access to Clearstream Luxembourg is also available to others, such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a Clearstream Luxembourg participant, either directly or indirectly.
Distributions with respect to the exchange notes held beneficially through Clearstream Luxembourg will be credited to cash accounts of Clearstream Luxembourg participants in accordance with its rules and procedures, to the extent received by the U.S. depositary for Clearstream Luxembourg.
Euroclear. Euroclear has advised the financial community that it was created in 1968 to hold securities for its participants and to clear and settle transactions between Euroclear participants through simultaneous electronic book-entry delivery against payment, eliminating the need for physical movement of certificates and eliminating any risk from lack of simultaneous transfers of securities and cash. Euroclear provides various other services, including securities lending and borrowing and interfaces with domestic markets in several countries. The Euroclear System is owned by Euroclear Clearance System Public Limited Company (ECSplc) and operated through a license agreement by Euroclear Bank S.A./N.V., a bank incorporated under the laws of the Kingdom of Belgium, which we refer to as the “Euroclear Operator.”
The Euroclear Operator holds securities and book-entry interests in securities for participating organizations and facilitates the clearance and settlement of securities transactions between Euroclear participants, and between Euroclear participants and participants of certain other securities intermediaries through electronic book-entry changes in accounts of such participants or other securities intermediaries.
The Euroclear Operator provides Euroclear participants, among other services, with safekeeping, administration, clearance and settlement, securities lending and borrowing, and related services.
Non-participants of Euroclear may hold and transfer book-entry interests in the securities through accounts with a direct participant of Euroclear or any other securities intermediary that holds a book-entry interest in the securities through one or more securities intermediaries standing between such other securities intermediary and the Euroclear Operator.
The Euroclear Operator is regulated and examined by the Belgian Banking and Finance Commission and the National Bank of Belgium.
Securities clearance accounts and cash accounts with the Euroclear Operator are governed by the “Terms and Conditions Governing Use of Euroclear” and the related operating procedures of the Euroclear System, and applicable Belgian law, which are collectively referred to as the “terms and conditions.” The terms and conditions govern transfers of notes and cash within Euroclear, withdrawals of notes and cash from Euroclear, and receipts of payments with respect to notes in Euroclear. All notes in Euroclear are held on a fungible basis without attribution of specific certificates to specific securities clearance accounts. The Euroclear Operator acts under the terms and conditions only on behalf of Euroclear participants, and has no record of or relationship with persons holding through Euroclear participants.
Distributions with respect to the exchange notes held beneficially through Euroclear will be credited to the cash accounts of Euroclear participants in accordance with the terms and conditions, to the extent received by the U.S. depositary for Euroclear.
Global Clearance and Settlement Procedures
Secondary market trading between DTC participants will occur in the ordinary way in accordance with DTC rules. Secondary market trading between Clearstream Luxembourg participants and/or Euroclear participants will
occur in the ordinary way in accordance with the applicable rules and operating procedures of Clearstream Luxembourg and Euroclear and will be settled using the procedures applicable to conventional eurobonds.
Cross-market transfers between persons holding directly or indirectly through DTC participants, on the one hand, and directly or indirectly through Clearstream Luxembourg or Euroclear participants, on the other hand, will be effected in DTC in accordance with DTC rules on behalf of the relevant international clearing system by its U.S. depositary. However, cross-market transactions will require delivery of instructions to the relevant international clearing system by the counterparty in that system in accordance with its rules and procedures and within its established deadlines (European time). The relevant international clearing system will, if a transaction meets its settlement requirements, deliver instructions to its U.S. depositary to take action to effect final settlement on its behalf by delivering or receiving securities in DTC. Clearstream Luxembourg participants and Euroclear participants may not deliver instructions directly to the respective U.S. depositary.
Because of time-zone differences, credits of exchange notes received in Clearstream Luxembourg or Euroclear as a result of a transaction with a DTC participant will be made during subsequent securities settlement processing and dated the business day following the DTC settlement date. These credits or any transactions in the exchange notes settled during the processing will be reported to the relevant Clearstream Luxembourg or Euroclear participants on that business day. Cash received in Clearstream Luxembourg or Euroclear as a result of sales of exchange notes by or through a Clearstream Luxembourg participant or a Euroclear participant to a DTC participant will be received with value on the DTC settlement date but will be available in the relevant Clearstream Luxembourg or Euroclear cash account only as of the business day following settlement in DTC.
Although it is expected that DTC, Clearstream Luxembourg and Euroclear will follow the foregoing procedures in order to facilitate transfers of exchange notes among participants of DTC, Clearstream Luxembourg and Euroclear, they are under no obligation to perform or continue such procedures and such procedures may be changed or discontinued at any time.
Governing Law
The indenture is, and the exchange notes and the guarantees will be, governed by, and construed in accordance with, the laws of the State of New York.
Trustee and Transfer and Paying Agent
Deutsche Bank Trust Company Americas, acting through its principal corporate trust office at 60 Wall Street, 16th Floor, MS: NYC60-1630, New York, New York 10005, will be the trustee for the exchange notes and the transfer and paying agent for the exchange notes.
In specific instances, CBS Corporation or the holders of a majority in principal amount of the outstanding exchange notes of a series issued under the indenture may remove the trustee (and the trustee may resign) with respect to exchange notes of such series and CBS Corporation will appoint a successor trustee. The trustee may become the owner or pledgee of any of the exchange notes with the same rights, subject to conflict of interest restrictions, it would have if it were not the trustee. The trustee and any successor trustee must be eligible to act as trustee under the Section 310(a)(1) of the Trust Indenture Act of 1939, as amended, and must have a combined capital and surplus of at least $50,000,000 and be subject to examination by federal or state authority. Subject to applicable law relating to conflicts of interest, the trustee also may serve as trustee under other indentures relating to securities issued by CBS Corporation or its affiliated companies and may engage in commercial transactions with CBS Corporation and its affiliated companies.
Purpose of the Exchange Offer
The purpose of the exchange offer is to provide holders of original notes with an opportunity to acquire exchange notes which, unlike the original notes, generally will be freely transferable at all times, subject to any restrictions on transfer imposed by securities laws, so long as the holder is (i) acquiring the exchange notes in the ordinary course of its business, (ii) has no arrangement or understanding with any person to participate in a distribution (within the meaning of the Securities Act) of the exchange notes and (iii) is not our affiliate within the meaning of the Securities Act.
Issuance of Original Notes. The outstanding original 2.900% senior notes due 2023 in the aggregate principal amount of $400,000,000 and the outstanding original 3.700% senior notes due 2028 in the aggregate principal amount of $500,000,000 were issued and sold by CBS Corporation and CBS Operations on November 16, 2017 to Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, Mizuho Securities USA LLC and RBC Capital Markets, LLC, as representatives of the initial purchasers, pursuant to a purchase agreement dated November 13, 2017. CBS Corporation and CBS Operations issued and sold the original notes in a transaction not requiring registration under the Securities Act in reliance upon an exemption from the registration requirements of the Securities Act. The resale of the original notes by the initial purchasers to investors was effected in transactions not requiring registration under the Securities Act pursuant to Rule 144A and Regulation S thereunder.
Transfer Restrictions. The original notes may not be offered for resale, resold or otherwise transferred other than pursuant to a registration statement filed pursuant to the Securities Act or unless an exemption from the registration requirements of the Securities Act is available or such registration requirements otherwise are not applicable to such resale or other transfer. Pursuant to Rule 144 under the Securities Act, the original notes generally may be resold without restriction in the public market commencing six months after the issue date by a holder who is not, and has not been for the preceding three months, our affiliate if CBS Corporation is current in the filing of its Exchange Act reports at the time of sale. After one year, no restrictions apply to public resales of the original notes by such persons, including the requirement that CBS Corporation be current in its public reporting under the Exchange Act. Other exemptions also may be available under other provisions of the federal securities laws for the resale of the original notes.
Registration Rights Agreement. In connection with the original issuance and sale of the original notes, we entered into a registration rights agreement dated as of November 16, 2017 with the representatives of the initial purchasers of the original notes (the “registration rights agreement”), pursuant to which we and CBS Operations agreed to file with the SEC an exchange offer registration statement on an appropriate form under the Securities Act with respect to an offer to the holders of the original notes to exchange their original notes for the exchange notes. The registration rights agreement provides that unless the exchange offer would not be permitted by applicable law or SEC policy, we and CBS Operations will use commercially reasonable efforts to:
file the exchange offer registration statement and cause the exchange offer registration statement to be declared effective by the SEC within 365 days after the issue date for the original notes (or, if such day is not a business day, the next succeeding business day) (the “target registration date”), and
consummate the exchange offer within 60 days after the effective date of the exchange offer registration statement.
We and CBS Operations have filed the registration statement of which this prospectus forms a part, and are conducting the exchange offer, in compliance with these requirements.
In accordance with the registration rights agreement, each holder of original notes is required to make specified representations and comply with the undertakings summarized below under “—Terms of the Exchange Offer—Resales of Exchange Notes.”
In the event that (i) we and CBS Operations determine that a registered exchange offer is not available under applicable law or if applicable interpretations of the staff of the SEC do not permit us to effect the exchange offer, (ii) for any reason, we and CBS Operations do not consummate the exchange offer within 60 days after the effective date of the exchange offer registration statement or (iii) before the 20th day following completion of the exchange offer, upon receipt of a written request (a “shelf request”) from any initial purchaser representing that it holds original notes that are ineligible to be exchanged in the exchange offer of original notes (the “ineligible notes”), we and CBS Operations will use commercially reasonable efforts to file and cause to become effective a shelf registration statement relating to resales of the original notes and to keep that shelf registration statement effective until the earlier of (1) the earliest date that is not less than three years after the issue date for the original notes and on which no registrable securities (subject to certain exceptions) are subject to any restrictions on transfer under the Securities Act, and (2) the date on which no securities registered thereunder constitute registrable securities (as described in the registration rights agreement). In the event of such a shelf registration, we and CBS Operations will provide to each noteholder copies of a prospectus, notify each noteholder when the shelf registration statement has become effective and take certain other actions to permit resales of the original notes. A noteholder that sells original notes under the shelf registration statement generally will be required to make certain representations to us (as described in the registration rights agreement), to be named as a selling security holder in the related prospectus and to deliver a prospectus to purchasers, will be subject to certain of the civil liability provisions under the Securities Act in connection with those sales and will be bound by the provisions of the registration rights agreement that are applicable to such a noteholder (including certain indemnification obligations). Holders of original notes also will be required to suspend their use of the prospectus included in the shelf registration statement under specified circumstances upon receipt of notice from us. As indicated above, under applicable interpretations of the staff of the SEC, our affiliates will not be permitted to exchange their original notes for registered original notes in the exchange offer.
If (i) the exchange offer registration statement has not become effective on or before the target registration date, (ii) the shelf registration statement, if required, has not become effective on or before (1) the target registration date, in the event that (a) we and CBS Operations determine that a registered exchange offer is not available under applicable law or if applicable interpretations of the staff of the SEC do not permit us to effect the exchange offer or (b) for any reason, we and CBS Operations do not consummate the exchange offer within 60 days after the effective date of the exchange offer registration statement, or (2) the later of (x) the target registration date and (y) 90 days (or if such 90th day is not a business day, the next succeeding business day) after delivery of a shelf request, in the event that we receive a shelf request from any initial purchaser of ineligible notes, (iii) the shelf registration statement, if required, has become effective and thereafter ceases to be effective or the prospectus contained therein ceases to be usable, at any time during the shelf effectiveness period (as described in the registration rights agreement), and such failure to remain effective or usable exists for more than 120 days (whether or not consecutive) in any12-month period or (iv) the shelf registration statement, if required, has become effective and thereafter, on more than three occasions in any12-month period during the shelf effectiveness period, ceases to be effective or the prospectus contained therein ceases to be usable (each such event, a “registration default”), the interest rate on the original notes will be increased by (i) 0.25% per annum for the first90-day period beginning on the day immediately following such registration default and (ii) an additional 0.25% per annum thereafter, until and including the date such registration default ends, up to a maximum aggregate increase of 0.50% per annum. If at any time more than one registration default has occurred and is continuing, then, until the next date on which there is no registration default, the increase in interest rate provided for by this paragraph shall apply as if there occurred a single registration default that begins on the date that the earliest such registration default occurred and ends on such next date that there is no registration default.
If we effect the exchange offer, we will be entitled to close the exchange offer 20 business days after its commencement, so longas we have accepted all original notes validly tendered in accordance with the terms
of the exchange offer. Original notes not tendered in the exchange offer will bear interest at the rate set forth on the cover page of this prospectus and be subject to all the terms and conditions specified in the indenture, including transfer restrictions.
We have agreed to pay all expenses incident to the exchange offer (other than commissions and concessions of any broker-dealer) and to indemnify the holders of the original notes against certain liabilities, including liabilities under the Securities Act.
This summary of certain provisions of the registration rights agreement does not purport to be complete and is subject to, and is qualified in its entirety by reference to, all of the provisions of the registration rights agreement, which is included as an exhibit to the registration statement of which this prospectus forms a part. For information about how you can view or obtain a copy of the registration rights agreement, see “Where You Can Find More Information.”
Terms of the Exchange Offer
The following summary of the terms of the exchange offer does not purport to be complete and is subject to, and is qualified in its entirety by reference to, all of the provisions of the letter of transmittal, a copy of the form of which is filed as an exhibit to the registration statement of which this prospectus forms a part.
General. Upon the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal, which together constitute the exchange offer, we will accept any and all original notes validly tendered and not withdrawn prior to 5:00 p.m., New York City time, on the expiration date. Subject to the minimum denomination requirements of the exchange notes, the exchange notes are being offered in exchange for a like principal amount of original notes. Original notes may be exchanged only in minimum denominations of $2,000 principal amount and in integral multiples of $1,000 principal amount in excess thereof. As of the date of this prospectus, there was outstanding $400,000,000 aggregate principal amount of 2023 original notes and $500,000,000 aggregate principal amount of 2028 original notes.
The terms of the exchange notes will be substantially identical to the terms of the original notes, except that the exchange notes are registered under the Securities Act and will bear a different CUSIP number from the original notes of the same series, and the transfer restrictions, registration rights and related additional interest terms applicable to the original notes (as described above under “—Purpose of the Exchange Offer—Registration Rights Agreement”) will not apply to the exchange notes. The exchange notes will evidence the same indebtedness as the original notes and will be entitled to the benefits of the indenture. The 2023 exchange notes will be treated as a single series under the indenture with any 2023 original notes that remain outstanding, and the 2028 exchange notes will be treated as a single series under the indenture with any 2028 original notes that remain outstanding.
Holders may tender some or all of their original notes pursuant to the exchange offer, except that if any original notes are tendered for exchange in part, the untendered amount of such original notes must be in minimum denominations of $2,000 principal amount and in integral multiples of $1,000 principal amount in excess thereof. The exchange offer for either series of original notes is not conditioned upon the exchange of any minimum aggregate principal amount of original notes of such series.
Holders of original notes do not have any appraisal or dissenters’ rights under the General Corporation Law of the State of Delaware in connection with the exchange offer.
Resales of Exchange Notes. Based on interpretations by the staff of the SEC as set forth inno-action letters issued to third parties with respect to other transactions, the exchange notes issued in the exchange offer may be offered for resale, resold or otherwise transferred without compliance with the registration and prospectus delivery requirements of the Securities Act by holders who satisfy the conditions described in the following paragraph. If a holder does not satisfy such conditions, in the absence of an exemption, it must comply with the registration and prospectus delivery requirements of the Securities Act in connection with the resale of the exchange notes. If a holder fails to comply with these requirements, it may incur liabilities under the Securities Act, and we will not indemnify the holder for such liabilities.
Each holder of original notes that wishes to exchange such original notes for exchange notes in the exchange offer will be required to make certain representations to us, including representations that:
any exchange notes to be received by it will be acquired in the ordinary course of its business;
it has no arrangement with any person to participate in the distribution (within the meaning of the Securities Act) of the exchange notes to be received in the exchange offer;
it is not our affiliate as defined in Rule 405 under the Securities Act or, if it is our affiliate, it will comply with the registration and prospectus delivery requirements of the Securities Act to the extent applicable; and
it is not prohibited by any law or policy of the SEC from participating in the exchange offer.
In addition, if the holder is not a broker-dealer, it will be required to represent to us that it has not engaged in, is not engaged in, and does not intend to engage in a distribution of exchange notes.
Any broker-dealer that holds original notes acquired for its own account as a result of market-making activities or other trading activities, and that receives exchange notes in exchange for such original notes pursuant to the exchange offer, must deliver a prospectus in connection with any resale of such exchange notes, and must agree in the letter of transmittal that it will do so. By making this acknowledgement and by delivering a prospectus, any such broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act. We have agreed in the registration rights agreement that, for a period beginning on the date on which the exchange offer is consummated and ending on the earlier of 180 days after the effective date of the registration statement of which this prospectus forms a part (which is the date of this prospectus) and the date on which a broker-dealer is no longer required to deliver a prospectus in connection with market-making activities or other trading activities, we will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. A broker-dealer that delivers such a prospectus to purchasers in connection with such resales will be subject to certain of the civil liability provisions under the Securities Act. For additional information, see “Plan of Distribution.”
Each broker-dealer that acquired original notes for its own account as a result of market-making activities or other trading activities, by tendering such original notes, will agree that, upon receipt of notice from us of the occurrence of any event or the discovery of any fact that makes any statement included or incorporated by reference in this prospectus untrue in any material respect or that causes this prospectus to omit to state a material fact necessary to make the statements included or incorporated by reference therein, in the light of the circumstances under which they were made, not misleading or of the occurrence of certain other events specified in the registration rights agreement, such broker-dealer will suspend the sale of exchange notes pursuant to this prospectus until we have amended or supplemented the prospectus to correct such misstatement or omission and have furnished copies of the amended or supplemented prospectus to such broker-dealer. If we give such a notice to suspend the sale of the exchange notes, we will extend the180-day period referred to above during which such broker-dealers are entitled to use this prospectus in connection with the resale of exchange notes by the number of days during the period from and including the date on which we gave such notice to and including the date on which such broker-dealer received copies of the supplemented or amended prospectus necessary to permit resales of the exchange notes.
A broker-dealer that intends to use this prospectus in connection with resales of exchange notes must so notify us prior to the expiration of the exchange offer. The notice may be given in the space provided for this notice in the letter of transmittal or may be delivered to the exchange agent at the address set forth below under the caption “Exchange Agent.”
Expiration Date; Extension; Termination
Unless extended by us, the exchange offer will expire at 5:00 p.m., New York City time, on December , 2018, which time and date we refer to as the “expiration date.” We reserve the right to extend the exchange offer at our discretion, in which event the term “expiration date” will mean the time and date on which the exchange
offer as so extended will expire. If we extend the exchange offer, we will issue a press release or other public announcement of the extension as soon as reasonably practicable, but in any event no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date.
We reserve the right to extend or terminate the exchange offer and not accept for exchange any original notes if any of the events set forth below under “—Conditions to the Exchange Offer” occurs and is not waived by us, by giving oral or written notice of such extension or termination to the exchange agent. The rights reserved by us in this paragraph are in addition to our rights set forth below under “—Conditions to the Exchange Offer.”
Procedures for Tendering
The tender to us of original notes by a holder pursuant to one of the procedures set forth below and the acceptance thereof by us will constitute a binding agreement between such holder and us in accordance with the terms and subject to the conditions set forth in this prospectus and in the letter of transmittal.
Except as set forth below, a holder that wishes to tender original notes for exchange must transmit, prior to the expiration date, a properly completed and duly executed letter of transmittal, or an “agent’s message” in lieu of a letter of transmittal, and all other documents required by the letter of transmittal to the exchange agent at the address set forth below under “—Exchange Agent.” In addition, either:
the exchange agent must receive certificates for such original notes along with the letter of transmittal; or
the exchange agent must receive, prior to the expiration date, a timely confirmation of a book-entry transfer, which we refer to as a “book-entry confirmation,” of such original notes into the exchange agent’s account at DTC pursuant to the book-entry transfer procedure described below under “—Book-Entry Transfer”; or
the holder must comply with the guaranteed delivery procedures described below.
Letters of transmittal, certificates for original notes and other documents should be sent to the exchange agent and not to us.
The term “agent’s message” means a message, transmitted by DTC to and received by the exchange agent and forming a part of a book-entry confirmation, which states that DTC has received an express acknowledgement from the tendering participant that such participant has received and agrees to be bound by the letter of transmittal and that we may enforce such letter of transmittal against such participant.
The method of delivery of original notes, the letter of transmittal and other required documents to the exchange agent is at the option and sole risk of the holder, and delivery will be deemed made only when these items are actually received by the exchange agent. If delivery is to be made other than by hand or facsimile transmission, registered mail with return receipt requested, properly insured, or overnight delivery service is recommended. In all cases, sufficient time should be allowed to ensure timely delivery to the exchange agent.
Signatures on a letter of transmittal must be guaranteed unless the original notes tendered pursuant thereto are tendered (i) by a registered holder of original notes that has not completed the box entitled “Special Issuance Instructions” or “Special Delivery Instructions” on the letter of transmittal or (ii) for the account of any firm that is an “eligible institution.” An eligible institution includes, among others, a commercial bank, broker, dealer, credit union and national securities exchange. In all other cases, an eligible institution must guarantee signatures on a letter of transmittal.
If the letter of transmittal is signed by a person other than a registered holder of any original notes tendered therewith, the certificates for such original notes must be endorsed or accompanied by appropriate bond powers, in either case signed exactly as the name of the registered holder appears on the original notes, and such signatures must be guaranteed by an eligible institution.
If the letter of transmittal or any certificates for original notes or bond powers are signed by trustees, executors, administrators, guardians,attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing and must submit proper evidence satisfactory to us of their authority to act in such a capacity.
All questions as to the validity, form, eligibility (including time of receipt) and acceptance of tendered original notes will be resolved by us, and our determination of such questions will be final and binding on all parties. We reserve the absolute right to reject any or all tenders that are not in proper form or the acceptance of which would, in the opinion of our counsel, be unlawful. We also reserve the right to waive any irregularities or conditions in any tender of particular original notes, whether or not we waive similar irregularities or conditions in tenders of other original notes. Our interpretation of the terms and conditions of the exchange offer (including the instructions in the letter of transmittal) will be final and binding on all parties. Neither we, any of our affiliates or assigns, the exchange agent nor any other person will be under any duty to give notification of any irregularities in tenders or will incur any liability for any failure to give such notification. Tenders of original notes will not be deemed to have been made until all irregularities have been cured or waived. Any original notes received by the exchange agent that are not properly tendered and as to which the irregularities have not been cured or waived will be promptly returned by the exchange agent to the tendering holder, unless otherwise provided in the letter of transmittal.
Book-Entry Transfer
The exchange agent will make a request to establish an account with respect to the original notes at DTC for purposes of the exchange offer within two business days after the date of this prospectus. Any financial institution that is a participant in DTC’s book-entry transfer facility systems may make book-entry delivery of original notes by causing DTC to transfer those original notes into the exchange agent’s account at DTC in accordance with DTC’s procedures for transfer. Although delivery of original notes may be effected through book-entry transfer into the exchange agent’s account at DTC, an agent’s message or a duly executed letter of transmittal, including all other documents required by such letter of transmittal, must in any case be transmitted to and received by the exchange agent at the address set forth below under “—Exchange Agent” prior to the expiration date, or the guaranteed delivery procedures described below must be complied with.
Delivery of documents to DTC in accordance with DTC’s procedures does not constitute delivery to the exchange agent.
Guaranteed Delivery Procedures
Holders who wish to tender their original notes and (i) whose original notes are not immediately available or (ii) who cannot deliver their original notes, the letter of transmittal or any other required documents to the exchange agent prior to the expiration date, or comply with the procedures for book-entry transfer, may effect a tender if:
the tender is made by or through an eligible institution;
a properly completed and duly executed notice of guaranteed delivery, substantially in the form made available by us, is received by the exchange agent prior to the expiration date; and
the certificates (or a book-entry confirmation) representing all tendered original notes, in proper form for transfer, together with a letter of transmittal (or facsimile thereof), properly completed and duly executed, with any required signature guarantees, or an agent’s message in lieu thereof, and any other documents required by the letter of transmittal are received by the exchange agent within two business days after the expiration date.
The notice of guaranteed delivery may be delivered by hand or transmitted by facsimile, overnight courier or mail to the exchange agent, and must include a guarantee by an eligible institution in the form set forth in such
notice of guaranteed delivery. For original notes to be properly tendered pursuant to the guaranteed delivery procedure, the exchange agent must receive a notice of guaranteed delivery prior to the expiration date.
Conditions to the Exchange Offer
Notwithstanding any other provisions of the exchange offer, or any extension of the exchange offer, we will not be required to accept for exchange, or to issue exchange notes in exchange for, any original notes and may terminate the exchange offer (whether or not any original notes have been accepted for exchange) or may waive any conditions to or amend the exchange offer, if any of the following conditions has occurred or exists or has not been satisfied:
there is threatened, instituted or pending any action or proceeding before, or any injunction, order or decree issued by, any court or governmental agency or other governmental regulatory or administrative agency or commission:
| (1) | seeking to restrain or prohibit the making or completion of the exchange offer or any other transaction contemplated by the exchange offer, or assessing or seeking any damages as a result of the exchange offer or any such transaction; or |
| (2) | resulting in a material delay in our ability to accept for exchange or exchange some or all of the original notes in the exchange offer; or |
| (3) | any statute, rule, regulation, order or injunction has been sought, proposed, introduced, enacted, promulgated or deemed applicable to the exchange offer or any of the transactions contemplated by the exchange offer by any governmental authority, domestic or foreign; or |
any action has been taken, proposed or threatened by any governmental authority, domestic or foreign, that in our reasonable judgment might directly or indirectly result in any of the consequences referred to in clause (1), (2) or (3) above or, in our reasonable judgment, might result in the holders of exchange notes having obligations with respect to resales and transfers of exchange notes which are greater than those described in the interpretations by the staff of the SEC discussed above, or would otherwise make it inadvisable to proceed with the exchange offer; or
there is threatened, instituted or pending any action or proceeding before, or any injunction, order or decree issued by, any court or governmental agency or other governmental regulatory or administrative agency or commission, or any change to our organizational documents has been proposed, made or publicly disclosed, which may affect our rights or obligations to undertake any significant transaction relating to our business, capital structure or governance, or which is or may be adverse to us, and which in our reasonable judgment makes it inadvisable to proceed with the exchange offer; or
there has occurred:
| (1) | any general suspension of or general limitation on prices for, or trading in, securities on any national securities exchange or in theover-the-counter market; or |
| (2) | any limitation by a governmental authority which may adversely affect our ability to complete the transactions contemplated by the exchange offer; or |
| (3) | a declaration of a banking moratorium or any suspension of payments in respect of banks in the United States or any limitation by any governmental agency or authority which adversely affects the extension of credit; or |
| (4) | a commencement of a war, armed hostilities or other similar international calamity directly or indirectly involving the United States, or, in the case of any of the preceding events existing at the time of the commencement of the exchange offer, a material acceleration or worsening of these calamities; or |
any person, after the date of this prospectus, has commenced, proposed, announced, made or publicly disclosed a tender or exchange offer (other than this exchange offer), merger, acquisition, business combination or other similar transaction involving us or any of our subsidiaries or we have entered into a definitive agreement, an agreement in principle or negotiations with any person with respect to such a tender or exchange offer, merger, acquisition, business combination or other similar transaction; or
any person, entity or group (as such term is used in Section 13(d)(3) of the Exchange Act andRule 13d-5 thereunder) has filed a Notification and Report Form for Certain Mergers and Acquisitions under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, reflecting an intention to acquire us or any of our shares, or has made a public announcement reflecting an intention to acquire us or any of our subsidiaries or any of our or their respective assets or securities; or
any person or group (as such term is used in Section 13(d)(3) of the Exchange Act andRule 13d-5 thereunder) that has filed a Schedule 13D or Schedule 13G with the SEC before the date of this prospectus has, after the date of this prospectus, acquired or publicly proposed to acquire beneficial ownership of additional shares representing more than 2% of the shares outstanding at the time of such acquisition or proposal, or any other person or group has, after the date of this prospectus, acquired or publicly proposed to acquire beneficial ownership of shares representing more than 5% of the shares outstanding at the time of such acquisition or proposal; or
any change, or any development involving a prospective change, has occurred or been threatened in our business, financial condition, operations or prospects and those of our subsidiaries taken as a whole that is or may be adverse to us, or we have become aware of facts that have or may have an adverse impact on the value of the original notes or the exchange notes, which, in our reasonable judgment, in any case makes it inadvisable to proceed with the exchange offer or with acceptance for exchange or exchange of some or all of the original notes; or
there has occurred a change in the interpretations by the staff of the SEC which permits the exchange notes issued pursuant to the exchange offer in exchange for original notes to be offered for resale, resold and otherwise transferred by holders thereof (other than broker-dealers and any such holder which is our affiliate within the meaning of Rule 405 promulgated under the Securities Act) without compliance with the registration and prospectus delivery provisions of the Securities Act, provided that such exchange notes are acquired in the ordinary course of such holders’ business and such holders have no arrangement or understanding with any person to participate in the distribution (within the meaning of the Securities Act) of such exchange notes; or
any law, statute, rule or regulation has been adopted or enacted which, in our reasonable judgment, would be expected to impair our ability to proceed with the exchange offer; or
a stop order has been issued by the SEC or any state securities authority suspending the effectiveness of the registration statement of which this prospectus forms a part, or proceedings have been initiated or, to our knowledge, threatened for that purpose, or any governmental approval has not been obtained, which approval we shall, in our reasonable discretion, deem necessary for the consummation of the exchange offer as contemplated hereby; or
we have received an opinion of counsel experienced in such matters to the effect that there exists any actual or threatened legal impediment (including a default or prospective default under an agreement, indenture or other instrument or obligation to which we are a party or by which we are bound) to the consummation of the transactions contemplated by the exchange offer.
If we determine, in our sole discretion, that any of the foregoing events or conditions has occurred or exists or has not been satisfied, we may, subject to applicable law, terminate the exchange offer (whether or not any original notes have been accepted for exchange) or may waive any such condition or otherwise amend the terms of the exchange offer in any respect. If any such waiver or amendment constitutes a material change to the exchange offer, we will promptly disclose such waiver or amendment by means of a prospectus supplement that will be distributed to the registered holders of the original notes and will extend the exchange offer to the extent required by Rule14e-1 under the Exchange Act.
These conditions are for our sole benefit and we may assert them regardless of the circumstances giving rise to any of these conditions, or we may waive them, in whole or in part, in our sole discretion, subject to applicable law. Any determination made by us concerning an event, development or circumstance described or referred to above will be final and binding on all parties.
Acceptance of Original Notes for Exchange; Delivery of Exchange Notes
Upon the terms and subject to the conditions of the exchange offer, we will accept all original notes validly tendered and not withdrawn prior to 5:00 p.m., New York City time, on December , 2018 (or any later time and date to which we extend the exchange offer). We will issue exchange notes in exchange for such original notes promptly following the expiration date.
Subject to the conditions set forth above under “—Conditions to the Exchange Offer,” issuance of exchange notes in exchange for original notes tendered and accepted for exchange pursuant to the exchange offer will be made only after timely receipt by the exchange agent of certificates for original notes or a book-entry confirmation of a book-entry transfer of original notes into the exchange agent’s account at DTC, a completed letter of transmittal, or, in the case of a book-entry transfer, an agent’s message in lieu of the letter of transmittal, and any other documents required by the letter of transmittal. Accordingly, the time of delivery of exchange notes will depend upon when certificates for original notes, book-entry confirmations with respect to original notes and other required documents are received by the exchange agent, and such delivery might not be made to all tendering holders at the same time.
Subject to the terms and conditions of the exchange offer, we will be deemed to have accepted for exchange, and thereby to have exchanged, original notes validly tendered and not withdrawn as, if and when we give written notice to the exchange agent of our acceptance of such original notes for exchange pursuant to the exchange offer. The exchange agent will act as agent for us for the purpose of receiving tenders of original notes, letters of transmittal and related documents, and as agent for tendering holders for the purpose of receiving original notes, letters of transmittal and related documents and transmitting exchange notes that will not be held in global form by DTC or a nominee of DTC to validly tendered holders. Such exchange will be made promptly after the expiration date. If for any reason whatsoever, acceptance for exchange or the exchange of any original notes tendered pursuant to the exchange offer is delayed (whether before or after our acceptance for exchange of original notes) or we extend the exchange offer or are unable to accept for exchange or exchange any original notes tendered pursuant to the exchange offer, then, without prejudice to our rights set forth herein, the exchange agent may, nevertheless, on our behalf and subject to Rule14e-l under the Exchange Act, retain tendered original notes and such original notes may not be withdrawn except to the extent tendering holders are entitled to withdrawal rights as described under “—Withdrawal Rights.”
Pursuant to the letter of transmittal or an agent’s message in lieu thereof, a holder of tendered original notes will represent and warrant to us that it has full power and authority to tender, exchange, sell, assign and transfer such original notes, that we will acquire good, marketable and unencumbered title to such original notes, free and clear of all liens, restrictions, charges and encumbrances, and that such original notes are not subject to any adverse claims or proxies. The holder also will warrant and agree with us that, upon request, it will execute and deliver any additional documents deemed by us or the exchange agent to be necessary or desirable to complete the exchange, assignment and transfer of the original notes tendered pursuant to the exchange offer.
Any original notes that have been tendered for exchange but that are not exchanged for any reason will be returned to the holder thereof without cost to such holder (or in the case of original notes tendered by book-entry transfer into the exchange agent’s account at DTC pursuant to the book-entry transfer procedures described above, such original notes will be credited to an account maintained with DTC for the original notes) promptly after withdrawal, rejection of tender or termination or expiration of the exchange offer.
Withdrawal Rights
Tenders of original notes may be withdrawn at any time prior to the expiration of the exchange offer. Any original notes that are properly withdrawn will be deemed not to have been validly tendered for exchange for purposes of the exchange offer.
For a withdrawal to be effective, the exchange agent must receive a written notice of withdrawal at the address, or in the case of eligible institutions, at the facsimile number, set forth below under “—Exchange Agent” before 5:00 p.m., New York City time, on December , 2018 (or any later time and date to which we extend the exchange offer). Any notice of withdrawal must specify the name of the person that tendered the original notes to be withdrawn, identify the original notes to be withdrawn (including the principal amount of the original notes), and (where certificates for original notes have been transmitted) specify the name in which such original notes are registered, if different from that of the withdrawing holder. If certificates for original notes have been delivered or otherwise identified to the exchange agent, then, prior to the release of such certificates, the withdrawing holder also must submit the serial numbers of the particular certificates to be withdrawn and a signed notice of withdrawal with signatures guaranteed by an eligible institution, unless such holder is an eligible institution. If original notes have been tendered pursuant to the procedure for book-entry transfer described above, any notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawn original notes and otherwise comply with the procedures of such facility.
All questions as to the validity, form and eligibility (including time of receipt) of withdrawal notices will be determined by us, in our sole discretion, and our determination will be final and binding on all parties. Neither we, any of our affiliates or assigns, the exchange agent nor any other person will be under any duty to give notification of any irregularities in any notice of withdrawal or will incur any liability for any failure to give such notification.
Properly withdrawn original notes may be retendered by following one of the procedures described above under “—Procedures for Tendering” at any time prior to the expiration date.
Exchange Agent
We have appointed Deutsche Bank Trust Company Americas as the exchange agent for the exchange offer. You should direct all executed letters of transmittal and other required documents to the exchange agent at the address indicated below. You should direct questions and requests for assistance, requests for additional copies of this prospectus or of the letter of transmittal and requests for notices of guaranteed delivery to the exchange agent addressed as follows:
By Registered or Certified Mail,
Overnight Delivery, Courier or
Electronic Mail:
DB Services Americas, Inc.
MS: JCK01-0218
Attention: Reorg. Department
5022 Gate Parkway, Suite 200
Jacksonville, FL 32256
DB.Reorg@db.com
By Facsimile Transmission:
(615)866-3889
To Confirm by Telephone:
(877)843-9767
If you deliver the letter of transmittal and other required documents to an address other than any address indicated above or transmit instructions by facsimile to a facsimile number other than any facsimile number indicated above, your delivery or transmission will not constitute a valid delivery of the letter of transmittal or such other documents.
Payment of Expenses
We have not retained any dealer-manager or similar agent in connection with the exchange offer. We will not make any payment to brokers, dealers or others for soliciting acceptances of the exchange offer. However, we will pay the reasonable and customary fees and reasonableout-of-pocket expenses to the exchange agent for its services. We also will pay the cash expenses to be incurred in connection with the exchange offer, including accounting, legal, printing and other related fees and expenses.
Tendering holders will not be required to pay brokerage commissions or fees or, subject to the instructions in the letter of transmittal, transfer taxes with respect to the exchange of original notes pursuant to the exchange offer. If exchange notes are to be delivered to, or are to be issued in the name of, any person other than the registered holder of the original notes tendered, or if a transfer tax is imposed for any reason other than the exchange of original notes in connection with the exchange offer, the amount of any such transfer tax, whether imposed on the registered holder or any other person, will be payable by the tendering holder. If satisfactory evidence of payment of such taxes or exemption therefrom is not submitted with the letter of transmittal, the amount of such transfer taxes will be billed directly to such tendering holder.
Accounting Treatment
The exchange notes will be recorded at the same carrying value as the original notes, as reflected in our accounting records on the date of the exchange. Accordingly, no gain or loss for accounting purposes will be recognized.
Consequences of Failure to Exchange
Any original notes not exchanged in the exchange offer will remain entitled to the rights and subject to the limitations contained in the indenture. Following the exchange offer, however, all outstanding original notes will continue to be subject to the same restrictions on transfer, and we will have no obligation to register outstanding original notes under the Securities Act (except in the limited circumstances provided in the registration rights agreement) or to pay contingent increases in interest based on our original registration obligation. Until termination of the transfer restrictions applicable to such original notes under the Securities Act and applicable state securities laws, such original notes generally may be resold or otherwise transferred only:
to us;
pursuant to an effective registration statement under the Securities Act;
to a qualified institutional buyer in compliance with Rule 144A under the Securities Act;
pursuant to offers or sales tonon-U.S. Persons that occur outside the United States within the meaning of Regulation S under the Securities Act; or
pursuant to another available exemption from the registration requirements of the Securities Act.
The liquidity of the original notes could be adversely affected by the exchange offer. For additional information, see “Risk Factors—If you fail to exchange your original notes for exchange notes, it may be difficult to resell your original notes.”
U.S. FEDERAL INCOME TAX CONSIDERATIONS
This descriptionsummary describes the material U.S. federal income tax consequences of participation in the exchange offer and of the ownership and disposition of exchange notes, subject to the limitations stated below. This summary is based on the Internal Revenue Code of 1986, as amended to the date hereof (the "Code"“Code”), administrativeTreasury Regulations (including proposed Regulations and temporary Regulations) promulgated thereunder, rulings, official pronouncements and judicial decisions, and existing and proposed Treasury Regulations, and interpretations of
the foregoing, changes to any of which subsequent toall as in effect on the date of this prospectus may affectand all of which are subject to change, possibly with retroactive effect, or to different interpretations. We refer to the exchange notes and the original notes together as the “notes.”
This summary provides general information only and does not address all of the U.S. federal income tax consequences described herein. These statementsthat may be applicable to a holder of notes. It does not address only
the tax consequences to initial holders holding senior securities as capital
assets within the meaning of Section 1221 of the Code. They do not discuss all of the tax consequences that may be relevant to holders in lightcertain types of their
particular circumstances or to holders subject to special rules,treatment under the U.S. federal income tax law, such as certainindividual retirement and othertax-deferred accounts, dealers in securities or currencies, traders in securities that electmark-to-market treatment, financial institutions, insurance companies, dealerstax-exempt organizations, persons that are members of “expanded groups” within the meaning of Treasury RegulationSection 1.385-1 of which CBS Corporation is also a member, persons holding notes as a hedge, as a position in securitiesa straddle for tax purposes, or foreign
currencies, United States Holdersas part of a “synthetic security” or other integrated investment composed of notes and one or more other investments, accrual method taxpayers that are required to recognize income for U.S. federal income tax purposes no later than when such income is taken into account in applicable financial statements, U.S. holders (as defined below) whose functional currency (as defined in Code Section 985) is notother than the U.S. dollar, or certain U.S. expatriates. This summary is limited to persons holding senior
securities in connection withwho hold notes as a hedging transaction, "straddle", conversion
transaction or other integrated transaction, traders in securities that elect to
mark to market, holders liable forcapital asset within the meaning of Section 1221 of the Code. Moreover, the effect of any alternative minimum tax, the Medicare tax on investment income, applicable state, local or persons who have
ceased toforeign tax laws or U.S. federal tax laws other than income tax law is not discussed. No ruling has been or will be United States citizens or toobtained from the Internal Revenue Service (the “IRS”) regarding the U.S. federal income tax treatment of the notes, and no assurances can be taxed as resident aliens.given that the IRS will not disagree with portions of this summary. Persons considering the purchaseacquisition of the senior securitiesnotes should consult their own tax advisors concerning the application of United Statesthe U.S. federal income tax laws,law to their particular situations, as well as any tax consequences arising under the lawslaw of any state, local or foreign taxing jurisdictions, to their
particular situations.
As used in this section, a "United States Holder"tax jurisdiction and any other tax laws, including estate and gift tax liability.
For purposes of the following discussion, the term “U.S. holder” means a beneficial owner of senior securities that is for United States federal income tax purposes
a holder that is a United States person (as defined in "Descriptionnotes who is:
| (1) | an individual who is a citizen or resident of |
| (2) | an estate subject to U.S. federal income taxation without regard to the source of its income; |
| (3) | a corporation or other business entity treated as a corporation for U.S. federal income tax purposes created or organized in or under the laws of the United States, any state thereof or the District of Columbia; or |
| (4) | a trust if (a) such trust was in existence on August 20, 1996, was treated as a U.S. person prior to such date and has a valid election in effect to continue to be treated as a U.S. person, as defined in the Code, or (b) both (i) a court within the United States is able to exercise primary supervision over the administration of the trust, and (ii) one or more U.S. persons have the authority to control all substantial decisions of the trust. |
The term "United States Alien Holder"“non-U.S. holder” means a beneficial owner of senior securities that is,notes, other than a partnership or other entity treated as a partnership for United StatesU.S. federal income tax purposes:
opurposes, who is not a nonresident alien individual;
oU.S. holder.
If a foreign corporation;
opartnership (including for this purpose any entity treated as a nonresident alien fiduciarypartnership for U.S. federal income tax purposes) is a beneficial owner of notes, the treatment of a foreign estate or trust; or
o a foreignpartner in the partnership one or morewill generally depend upon the status of the memberspartner and upon the activities of whichthe partnership. A holder of notes that is a nonresident alien individual,partnership and partners in such a foreign corporation or a nonresident
alien fiduciarypartnership should consult their tax advisors.
Exchange of a foreign estate or trust.Original Notes for Exchange Offer
Notes
The exchange of unregistered senior securitiesoriginal notes for exchange senior
securitiesnotes pursuant to the exchange offer will not beconstitute a taxable event to holders. Rather, the exchange notes will be treated as a continuation of the original notes for United
StatesU.S. federal income tax purposes. Accordingly, a holder will not recognize
taxablepurposes, and are referred to together with the original notes as “notes” in this summary of U.S. federal income tax consequences. Consequently, no gain or loss aswill be recognized by a resultholder upon receipt of suchan exchange note, the holding period of the exchange note will include the holding period of the original note, and the initial basis of the exchange note will havebe the same adjusted taxas the basis and holding period inof the exchange senior securities as such
holder had in the unregistered senior securitiesoriginal note immediately before the exchange.
Tax Consequences
Contingent Payments
In certain circumstances (see “Description of the Exchange Notes—Purchase of Exchange Notes Upon a Change of Control Repurchase Event”), we may be obligated to United Statespay amounts on the notes that are in excess of stated interest on or principal of the notes. We intend to take the position that the likelihood that we will be required to make such payments is remote or incidental as of the issue date of the notes and therefore that these provisions do not cause the notes to be treated as “contingent payment debt instruments” within the meaning of the applicable Treasury Regulations. However, additional income will be recognized by a holder of notes if any such additional payment is made. Our position that the contingencies described above are remote or incidental is binding on a holder, unless the holder discloses in the proper manner to the IRS that it is taking a different position. If the IRS successfully challenged our position, the notes could be treated as contingent payment debt instruments, in which case holders could be required to accrue interest income at a rate higher than the stated interest rate on the notes and to treat as ordinary income, rather than capital gain, any gain recognized on a sale, exchange, retirement or redemption of a note. The remainder of this discussion assumes that the notes will not be treated as contingent payment debt instruments.
U.S. Holders
Payments of Interest
Interest on senior securitiesNotes
Stated interest on the notes will generally be taxable to a United
States HolderU.S. holder as ordinary interest income at the time it accruesis accrued or is received in accordance with the United States Holder'sU.S. holder’s method of accounting for federal
income tax purposes.
46
Amortizable Bond Premium
In general, ifaccounting.
Market Discount
If a United States Holder purchasesU.S. holder acquires a senior securitynote at a premium (thatcost that is for an amount in excess of the amount payable upon theless than its stated redemption price at maturity thereof)(i.e., such Holder will be considered to have purchased such senior
security with "amortizable bond premium" equal toits stated principal amount), the amount of such excess.
Such Holder may elect to amortize such bond premium as an offset to interest
income, and not as a separate deduction item, as it accrues under a
constant-yield method over the remaining term of the senior security. Such
Holder's tax basis in the senior security will be reduced by the amount of the
amortized bond premium. Any such election shall apply to all debt instruments
(other than instruments the interest on whichdifference is excludible from gross income)
held by the United States Holder at the beginning of the first taxable year for
which the election applies or thereafter acquired and is irrevocable without the
consent of the Internal Revenue Service. Bond premium on senior securities held
by a United States Holder who does not elect to amortize the premium will
decrease the gain or increase the loss otherwise recognized on the disposition
of the senior securities.
Market Discount
If a United States Holder purchases a senior security for less than its
principal amount, the difference will be treated as a "market discount"“market discount” for U.S. federal income tax purposes, subjectunless such difference is less than .0025 multiplied by the stated redemption price at maturity multiplied by the number of complete years to a de minimus exception.
maturity (from the date of acquisition).
Under the market discount rules of the Code, a United States Holder will beU.S. holder is required to treat any partial payment of principal on a senior security, ornote, and any gain on itsthe sale, exchange, retirement or other disposition of a note, as ordinary income to the extent of the accrued market discount which wasthat has not previously been included in gross income. If the senior security is disposeda U.S. holder disposes of a note with market discount in a non-taxable transaction (other than a
nonrecognition transaction described in section 1276(c) of the Code),certain otherwise nontaxable transactions, such holder must include accrued market discount will be taxable to the United States Holder as ordinary income as if the United States Holderholder had sold the senior securitynote at ifsits then fair market value.
In addition,general, the amount of market discount that has accrued is determined on a United States Holderratable basis. A U.S. holder may, however, elect to determine the amount of accrued market discount on a constant yield to maturity basis. This election is made on anote-by-note basis and is irrevocable.
With respect to notes with market discount, a U.S. holder may not be requiredallowed to defer, until the
maturity of a senior security or its earlier disposition (including a
non-taxable transaction other than a transaction other than a transaction
described in section 1276(c) of the Code), the deduction of all ordeduct immediately a portion of the interest expense in respect ofon any indebtedness incurred or continued to purchase or to carry the senior security. Market discount will be considered to
accrue on a straight-line basis during the period from the date of acquisition
to the maturity date of the senior security, unless the United States Holder
elects to accrue on a constant-yield basis.notes. A United States Holder
U.S. holder may elect to include market discount in income currently as it accrues --on either(either ratably or on a ratable or constant-yield basis. If a United States
Holder makes this election,constant yield to maturity basis), in which case the rules regardinginterest deferral rule set forth in the treatment of gain upon the
disposition of the senior security and upon the receipt of certain cash payments
as ordinary income and regarding the deferral of interest deductionspreceding sentence will not apply. If a United States Holder elects to include market discount in income as
it accrues, theThis election will apply to all market discount obligationsdebt instruments acquired duringby the U.S. holder on or after the first day of the first taxable year to which the election applies. This
election may not be revokedapplies and is irrevocable without the consent of the Internal Revenue Service.
IRS. A U.S. holder’s tax basis in a note will be increased by the amount of market discount included in the holder’s income under the election.
Amortizable Bond Premium
If a U.S. holder purchases a note for an amount in excess of the stated redemption price at maturity, the holder will be considered to have purchased the note with “amortizable bond premium” equal in amount to the excess. Generally, a U.S. holder may elect to amortize the premium as an offset to interest income otherwise required to be included in income in respect of the note during the taxable year, using a constant yield method similar to that described above, over the remaining term of the note. Under Treasury Regulations, the amount of amortizable bond premium that a U.S. holder may deduct in any accrual period is limited to the amount by which the holder’s total interest inclusions on the note in prior accrual periods exceed the total amount treated by the holder as a bond premium deduction in prior accrual periods. If any of the excess bond premium is not deductible, that amount is carried forward to the next accrual period. Because the notes may be redeemed by us prior to maturity at a premium, special rules apply that may reduce or eliminate the amount of premium that a U.S. holder may amortize with respect to a note. A U.S. holder who elects to amortize bond premium must reduce the holder’s tax basis in the note by the amount of the premium used to offset interest income as set forth above. An election to amortize bond premium applies to all taxable debt obligations then owned and thereafter acquired by the U.S. holder and may be revoked only with the consent of the IRS.
Election of Constant Yield Method
U.S. holders may elect to include in gross income all interest that accrues on a note, including any stated interest, market discount,de minimis market discount and unstated interest, as adjusted by amortizable bond premium, by using a constant yield prescribed in the Code and applicable Treasury Regulations. This election for a note with amortizable bond premium will result in a deemed election to amortize bond premium for all taxable debt obligations held or subsequently acquired by the U.S. holder on or after the first day of the first taxable year to which the election applies and may be revoked only with the consent of the IRS. Similarly, this election for a note with market discount will result in a deemed election to accrue market discount in income currently for the note and for all other debt instruments acquired by the U.S. holder with market discount on or after the first day of the taxable year to which the election first applies, and may be revoked only with the consent of the IRS. A U.S. holder’s tax basis in a note will be increased by each accrual of income under the constant yield election described in this paragraph.
Sale, Exchange or Retirement of Notes
Upon the sale, exchange or retirement of senior securities,notes, a United
States HolderU.S. holder generally will recognize gain or loss equal to the difference between the amount realizedof cash and the fair market value of other property received on the sale, exchange or retirement of(except to the senior securitiesextent such amount is attributable to accrued but unpaid interest, which will be subject to tax as ordinary income to the extent not previously included in income) and such Holder's adjustedthe holder’s tax basis in the senior securities. A United States
Holder's adjusted tax basisnotes, which will, in senior securitiesgeneral, be the price paid for the notes by the U.S. holder, increased by the amount of any market discount previously included in gross income and reduced (but not below zero) by the amount of any amortizable bond premium applied to reduce, or allowed as a deduction against, interest on a note.
Gain or loss so recognized will equal the cost of the
senior securitiesbe capital gain or loss (except with respect to such Holder, subject to possible reduction by amortized
bond premium. The amount realized excludes any amounts attributable to unpaid
interest accrued between interest payment dates andmarket discount not previously included in income, which will 47
income. Such gain or loss will be capital gain or lossincome) and will be long-term capital gain or loss, if, at the time of the sale, exchange or retirement, the senior securities have beennotes were held by the U.S. holder for more than one year. Under current laws, the excess of the taxpayer's netlaw, long-term capital gains over net
short-termofnon-corporate taxpayers generally are taxed at lower rates than items of ordinary income. The deductibility of capital losses is taxed at a lower rate than ordinary income for
certain non-corporate taxpayers. The distinction between capital gain or loss
and ordinary income or loss is also relevant for purposes of, among other
things, the limitations on the deductibility of capital losses.
Tax Consequencessubject to United States Alienlimitations.
Non-U.S. Holders
Under present United States federal tax law, and subject
Subject to the discussion below concerningof backup withholding:
(a)withholding and FATCA below, payments of principal, interest and premium on the senior securities by Viacomus or our agent (in its paying agentcapacity as such) to any United States Alien Holder will be exempt
from the 30% United States federal withholding tax, provided that (i) such
Holder does not own, actually or constructively, 10% or more of the total
combined voting power of all classes of stock of Viacom entitled to vote,
(ii) such Holder is not a controlled foreign corporation related, directly
or indirectly, to Viacom through stock ownership, and (iii) the requirement
to certify such Holder's non-U.S. status, as set forth in section 871(h) or
section 881(c) of the Code, has been fulfilled with respect to the
beneficial owner, as discussed below;
(b) a United States Alien Holder of senior securities holder generally will not be subject to United StatesU.S. federal income tax on gain realized on the sale, exchange
or retirement of such senior securities, unless (i) such Holder is an
individual who is present in the United States for 183 days or more in the
taxable year of the disposition, and either the gain is attributable to an
office or other fixed place of business maintained by such individual in
the United States or, generally, such individual has a "tax home" in the
United States or (ii) such gain is effectively connected with the Holders'
conduct of a trade or business in the United States (and, if an income tax
treaty applies, generally is attributable to a U.S. "permanent
establishment" maintained by such Holder); and
(c) senior securities held by an individual who is not, for United States
estate tax purposes, a resident or citizen of the United States at the time
of his death will not be subject to United States federal estatewithholding tax, provided that the individual does not own, actually or constructively, 10%
or more of the total combined voting power of all classes of stock of
Viacom entitled to vote and, at the time of such individual's death,
payments with respect to such senior securities would not have been
effectively connected with the conduct by such individual of a trade or
business in the United States.
The certification requirement referred to in subparagraph (a) will be
fulfilled if the beneficial owner of senior securities certifies on Internal
Revenue Service Form W-8BEN or successor form under penalties of perjury, that
it is not a United States person and provides its name and address, and (i) such
beneficial owner files such Form W-8BEN or successor form with the withholding
agent or (ii) in the case of senior securities held on behalf of the beneficial
owners by a securities clearing organization, bank or other financial
institution holding customers' securities in the ordinary course of its trade or
business, such financial institution files with the withholding agent a
statement that it has received the Form W-8BEN or successor form from the United
States Alien Holder, furnishes the withholding agent with a copy thereof and
otherwise complies with the applicable Internal Revenue Service requirements.
that:
| (1) | such holder does not actually or constructively own 10% or more of the total combined voting power of all classes of our stock entitled to vote; |
| (2) | such holder is not a controlled foreign corporation for U.S. federal income tax purposes that is related to us through stock ownership; |
| (3) | such holder is not a bank receiving interest described in Code Section 881(c)(3)(A); and |
| (4) | neither we nor our agent has actual knowledge or reason to know that such holder is a U.S. person, and either |
| (a) | such holder properly certifies to us or our agent, under penalties of perjury, that such holder is not a U.S. person and provides its name and address (which certification can be made on IRS FormW-8BEN orW-8BEN-E, as applicable, or a suitable substitute or any successor form); or |
| (b) | a securities clearing organization, bank or other financial institution that holds customers’ securities in the ordinary course of its trade or business, or a “financial institution,” properly certifies to us or our agent, under penalties of perjury (which certification can be made on IRS FormW-8IMY or a suitable substitute or any successor form), that the certification described in clause (4)(a) above has been received from the beneficial owner by it or by another financial institution acting for the beneficial owner and delivers to us or our agent a copy of the certification described in clause (4)(a) above. |
Alternatively, these certification requirements will not apply if the
beneficial owner ofnon-U.S. holder holds the senior securities holds those securities directlynotes through a "qualified intermediary"(which“qualified intermediary” (which is anon-U.S. office of a
48
Internal Revenue ServiceIRS concerning withholding tax procedures), the qualified intermediary has sufficient information in its files to indicate that the holder is a United States Alien Holdernon-U.S. holder and the intermediary complies with Internal Revenue ServiceIRS requirements. Special rules may apply with respect to senior securitiesnotes held by a foreign partnership.
Prospective investors, including foreign partnerships and their partners and Holdersholders who hold their senior securitiesnotes through a qualified intermediary, should consult their tax advisersadvisors regarding possible reporting requirements.
If anon-U.S. holder cannot satisfy the requirements of the “portfolio interest” exemption described above, payments of interest made to such holder generally will be subject to a 30% withholding tax (or such lower rate as may be provided by an applicable income tax treaty between the United States Alien Holder of senior securitiesand a foreign country) unless another exemption applies and such holder complies with the relevant certification requirements. Any prospective investor who could not satisfy the portfolio interest exemption requirements described above should consult its tax advisors prior to making an investment in the notes.
If anon-U.S. holder is engaged in a trade or business in the United States and if interest on the senior securities
(or gain realized on their sale, exchange or other disposition)notes is effectively connected with the conduct of such trade or business (and, if required by an applicable income tax treaty, applies, generally is attributable to a U.S. "permanent establishment"
maintained bypermanent establishment), such Holder), the United States Alien Holder,holder, although exempt from theU.S. federal withholding tax discussed in(by reason of the preceding paragraphs,delivery of a properly completed IRS FormW-8ECI or suitable substitute or any successor form), will be subject to regular United StatesU.S. federal income tax on such effectively connected income, generallyinterest in the same manner as if it were a United States Holder. See "Tax Consequences
to United States Holders" above. In lieu of the certificate described in the
preceding paragraph, such a Holder will be required to provide to the
withholding agent a properly executed Internal Revenue Service Form W-8ECI or
successor form, as appropriate, to claim an exemption from withholding tax.U.S. person. In addition, if such United States Alien Holderholder is a foreign corporation, it may be subject to a 30% branch profits tax (unless reduced or eliminated byequal to 30% (or lesser rate under an applicable income tax treaty) onof its effectively connected earnings and profits, as defined in the Code, for the taxable year, subject to adjustments.
Subject to the discussion of backup withholding and FATCA below, any gain realized by anon-U.S. holder upon the sale, exchange or retirement of notes will not be subject to U.S. federal income or withholding taxes unless:
| (1) | such gain is effectively connected with a U.S. trade or business of the holder (and, if required by an applicable income tax treaty, is attributable to a U.S. permanent establishment); |
| (2) | in the case of an individual, such holder is present in the United States for 183 days or more in the taxable year of the sale, exchange or retirement and certain other conditions are met; or |
| (3) | such gain represents accrued interest, in which case the rules for interest would apply. |
Anon-U.S. holder described in clause (1) above generally will be subject to tax with respect to such gain in the same manner as a U.S. holder. In some circumstances, anon-U.S. holder which is a corporation will be subject to an additional “branch profits tax” at a 30% rate or, if applicable, a lower treaty rate on such income.
If anon-U.S. holder is an individual described in clause (2) above, such holder will be subject to a flat 30% tax on the gain derived from the sale or exchange, which may be offset by U.S. source capital losses, even though such holder is not considered a resident of the United States. Amounts attributable to such effectively connected income,accrued but unpaid stated interest realized on the sale or exchange of a note will be subject to the rules applicable to interest described above.
To claim the benefit of a treaty, thenon-U.S. holder must provide a properly executed IRS FormW-8BEN orW-8BEN-E, as applicable (or a suitable substitute form or any successor form), claiming an exemption from or reduction in withholding under the benefit of an applicable income tax treaty. In some circumstances, in lieu of providing an IRS FormW-8BEN orW-8BEN-E, as applicable (or any successor form), thenon-U.S. holder may provide certain adjustments.
Interest payments madedocumentary evidence issued by foreign governmental authorities to prove residence in a United States Alien Holder will generally
be reportedforeign country in order to the Holder and to the Internal Revenue Service on Form 1042-S.
However, this reporting does not apply if the Holder holds the senior securities
directly through a qualified intermediary.
claim treaty benefits.
Backup Withholding and Information Reporting
Under current United States federal income tax law,
Backup withholding and information reporting requirements may apply to certain payments of principal, premium, if any, and interest made to,on notes and to thecertain payments of proceeds of sales before maturity by, non-corporate
United States Holders. In addition, a 31% backup withholdingthe sale or retirement of notes. We, our paying agent or certain other parties, as the case may be, will be required to withhold tax will apply if
the noncorporate United States Holder (i) fails to furnish its Taxpayer
Identification Number ("TIN") which, for an individual, is his Social Security
Number, (ii) furnishes an incorrect TIN, (iii) is notified by the Internal
Revenue Servicefrom any payment that it is subject to backup withholding for failure to report
interest and dividend payments, or (iv) under certain circumstancesat a current rate of 24% of such payment if the holder fails to furnish its taxpayer identification number (social security number or employer identification number), to certify under penalties of perjury, that it has furnished a correct TIN and hassuch holder is not been notified by the Internal Revenue Service that it is subject to backup withholding, for failureor otherwise to report interest and dividend payments. Holders should
consult their tax advisers regarding their qualification for exemption fromcomply with the applicable requirements of the backup withholding rules. Certain holders are not subject to the backup withholding and the procedure for obtaining such an exemption if
applicable.
information reporting requirements.
Backup withholding and information reporting generally will not apply to payments made by us or our agent (in its capacity as such) to a holder of notes who has provided the required certification under penalties of perjury that such holder is not a U.S. person as set forth in clause (4) of the first sentence under“—Non-U.S. Holders” or has otherwise established an exemption (provided that neither we nor such agent has actual knowledge or reason to know that the holder is a U.S. person or that the conditions of any other exemption are not in fact satisfied). However, we and other payors may be required to report payments of interest on senior securitiesnotes on IRS Form1042-S even if the certifications required by Sections 871(h)payments are not otherwise subject to information reporting requirements. Copies of these information returns also may be made available under the provisions of a specific treaty or agreement to the tax authorities of the country in which thenon-U.S. holder resides.
The payment of the proceeds from the disposition of notes to or through the U.S. office of any broker, U.S. or foreign, will be subject to information reporting and 881(c)possible backup withholding unless the owner certifies as to itsnon-U.S. status under penalties of perjury in the manner described above are received or ifotherwise establishes an exemption, and the exemption for qualified intermediaries discussed above
applies, provided that Viacom or its paying agent or the qualified intermediary,
as the case may be,broker does not have actual knowledge or reason to know that the
payeenon-U.S. holder is a United States person.
Under current Treasury Regulations, payments onU.S. person or that the sale, exchange orconditions of any other exemption are not, in fact, satisfied.
The payment of the proceeds from the disposition of senior securities madea note to or through anon-U.S. office of anon-U.S. broker that is not a “U.S. related person” generally will not be subject to information reporting or backup withholding. For this purpose, a “U.S. related person” is:
| (1) | a controlled foreign corporation for U.S. federal income tax purposes; |
| (2) | a foreign person 50% or more of whose gross income from all sources for the three-year period ending with the close of its taxable year preceding the payment, or for such part of the period in which the broker has been in existence, is derived from activities that are effectively connected with the conduct of a U.S. trade or business; or |
| (3) | a foreign partnership that is either engaged in the conduct of a trade or business in the United States or of which more than 50% of the income or capital interests is held by U.S. persons. |
In the case of the payment of proceeds from the disposition of notes to or through anon-U.S. office of a broker that is either a U.S. person or a U.S. related person, the payment may be subject to information reporting unless the broker has documentary evidence in its files that the owner is anon-U.S. holder and the broker has no knowledge or reason to know to the contrary. Backup withholding will not apply to payments made through a foreign office of a broker generally will not be subject to backup withholding. However, if such
broker is:
othat is a United States person;
49
oU.S. person or a controlled foreign corporation for United States federal income tax
purposes;
o a foreignU.S. related person 50% or more of whose gross income for certain periods
is effectively connected with a United States trade or business; or
o a foreign partnership with certain connections to the United States;
then information reporting will be required unless the broker has in its records
documentary evidence that the beneficial owner is not a United States person and
certain other conditions are met or the beneficial owner otherwise establishes
an exemption. Backup withholding may apply to any payment that such broker is
required to report if the broker has(absent actual knowledge or reason to know that the payee is a United States person. Payments to or throughU.S. person).
Backup withholding is not an additional tax. Any amounts withheld under the United States office
of a broker will be subject to backup withholding and information reporting
unless the Holder certifies, under penalties of perjury, that it is not a United
States person and the payor does not have actual knowledge or reason to know
that the Holder is a United States person, or the Holder otherwise establishes
an exemption.
United States Alien Holders of senior securities should consult their
tax advisers regarding the application of information reporting and backup
withholding in their particular situations, the availability of an exemption
therefrom, and the procedure for obtaining such an exemption, if available. Any
amounts withheldrules from a payment to a United States Alien Holder under the backup
withholding rules willholder may be allowedclaimed as a credit against such Holder's United
Statesholder’s U.S. federal income tax liability and, if withholding results in an overpayment of tax, the holder may entitle such Holderbe entitled to a refund, provided that the Holder filesrequired information is timely furnished to the IRS. Holders should consult their own tax advisors regarding the filing of a United States incomeU.S. tax return and the required informationclaiming of a credit or refund of such backup withholding taxes.
Foreign Account Tax Compliance Act (FATCA)
A 30% U.S. federal withholding tax may apply to interest income paid on notes, and the gross proceeds from a disposition of notes occurring after December 31, 2018, in each case paid to (1) a “foreign financial institution” (as specifically defined in the Code), whether such foreign financial institution is furnishedthe beneficial owner or an intermediary, unless such foreign financial institution agrees to verify, report and disclose its “United States account” holders (as specifically defined in the Code) and meets certain other specified requirements, or (2) anon-financial foreign entity, whether suchnon-financial foreign entity is the beneficial owner or an intermediary, unless such entity provides a certification that the beneficial owner of the payment does not have any substantial U.S. owners or provides the name, address and taxpayer identification number of each substantial U.S. owner and certain other specified requirements are met. In certain cases, the relevant foreign financial institution ornon-financial foreign entity may qualify for an exemption from, or be deemed to be in compliance with, these rules. Further, foreign financial institutions andnon-financial foreign entities located in jurisdictions that have an intergovernmental agreement with the United States governing FATCA may be subject to different rules. If an interest payment is subject both to withholding under FATCA and to the Internal Revenue Service.
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Each broker-dealer that receives exchange senior securitiesnotes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with anythe resale of suchthe exchange senior securities.notes. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange senior securitiesnotes received in exchange for unregistered senior securitiesoriginal notes where such unregistered
senior securitiesoriginal notes were acquired as a result of market-making activities or other trading activities. We have agreed in the registration rights agreement that, for a period beginning on the date on which the exchange offer is consummated and ending on the earlier of 180 days after the expirationeffective date of the exchange offer,registration statement of which this prospectus forms a part (which is the date of this prospectus) and the date on which a broker-dealer is no longer required to deliver a prospectus in connection with market-making activities or other trading activities, we will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. In addition, until 90 days after the date of this prospectus, all
dealers effecting transactions in the exchange senior securities may be required
to deliver a prospectus.
We will not receive any proceeds from any sale of exchange senior
securitiesnotes by broker-dealers.
Exchange senior securitiesnotes received by broker-dealers for their own account pursuant to the exchange offer may be sold from time to time in one or more transactions in theover-the-counter market, in negotiated transactions, through the writing of options on the exchange senior
securitiesnotes or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices, or at negotiated prices.
Any such resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any such broker-dealer or the purchasers of any suchof the exchange senior securities. notes.
Any broker-dealer that resells exchange senior securitiesnotes that were received by it for its own account pursuant to the exchange offer and any broker or dealer that participates in a distribution of suchthe exchange senior securitiesnotes within the meaning of the Securities Act may be deemed to be an "underwriter"“underwriter” within the meaning of the Securities Act, and any profit on any such resale of exchange senior securitiesnotes and any commissioncommissions or concessions received by any such persons may be deemed to be underwriting compensation under the Securities Act.
The letter of transmittal states that, by acknowledging that it will deliver a prospectus and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter"“underwriter” within the meaning of the Securities Act.
For athe period of 180 days after the expiration of the exchange offerdescribed above, we will promptly send additional copies of this prospectus and any amendment or supplement to this prospectus to any broker-dealer that requests these documents. Any such documentsrequests should be made in the letter of transmittal. transmittal where indicated or otherwise should be directed to CBS Corporation, 51 West 52nd Street, New York, New York 10019, Attention: Legal Department, telephone:(212) 975-4321.
We have agreed in the registration rights agreement to pay all expenses incident to the exchange offer (including the expenses of one counsel for the holders of the
unregistered senior securities) other(other than commissions discounts orand concessions of any broker-dealersbroker-dealer) and willto indemnify the holders of the unregistered senior
securitiesoriginal notes (including any broker-dealers)broker-dealer) against certain liabilities, including liabilities under the Securities Act.
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LEGAL MATTERS
The validity
For additional information about the obligations of participating broker-dealers in connection with the exchange offer and the resale of exchange notes, see “The Exchange Offer—Terms of the exchange senior securities will be passed upon for
ViacomExchange Offer—Resales of Exchange Notes.”
WHERE YOU CAN FIND ADDITIONAL INFORMATION
Available Information
We file annual, quarterly and Viacom International by Shearman & Sterling,current reports, proxy and information statements and other information with the SEC. The SEC maintains a website that contains reports, proxy and information statements and other information that we file electronically with the SEC. The address of that website is www.sec.gov.
Our Class A Common Stock and Class B Common Stock are listed on the New York Stock Exchange. Information about us also is available at the New York.
EXPERTS
OurYork Stock Exchange.
In accordance with U.S. securities laws, CBS Operations is not obligated to file annual, quarterly and current reports, proxy and information statements and other information with the SEC. Accordingly, CBS Operations does not file separate financial statements with the SEC and does not independently publish its financial statements. CBS Operations’ financial condition, results of operations and cash flows are consolidated into the financial statements of CBS Corporation.
We and CBS Operations have filed a registration statement on FormS-4 under the Securities Act with the SEC to register the securities offered by this prospectus. This prospectus does not contain all of the information contained in the registration statement because certain parts of the registration statement are omitted in accordance with the rules and regulations of the SEC. The registration statement and the documents filed or incorporated by reference as exhibits to the registration statement, including the indenture and the registration rights agreement described in this prospectus, frommay be accessed through the SEC’s website set forth above.
Documents Incorporated by Reference
We are “incorporating by reference” specific documents that we file with the SEC, which means that we may disclose important information to you by referring you to those documents that are considered part of this prospectus. Information that we file subsequently with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below that we have filed with the SEC and any documents subsequently filed with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Exchange Act (other than, in each case, documents or information deemed to have been furnished and not filed in accordance with SEC rules) prior to the termination of the offering under this prospectus:
our Annual Report on Form10-K for the year ended December 31, 2017;
our Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2018, June 30, 2018 and September 30, 2018; and
our Current Reports on Form8-K filed on January 12, 2018, February 1, 2018, May 14, 2018, May 18, 2018, May 22, 2018, June 6, 2018, July 30, 2018, September 10, 2018 (solely Items 1.01, 5.02 and 5.03 and Exhibits 3(b), 10(a) and 10(b) of Item 9.01(d)), September 27, 2018, September 27, 2018, September 28, 2018, October 9, 2018, October 12, 2018, October 19, 2018, October 22, 2018 and November 2, 2018 (reporting under Items 8.01 and 9.01(d) a recast of the following sections of our Annual Report on Form 10-K for the year ended December 31, 1999, as2017 to reflect the adoption of amended FASB guidance on April 28, 2000, have been auditedthe presentation of net periodic pension and postretirement benefit cost: Item 6. Selected Financial Data; Item 7. Management’s Discussion and Analysis of Results of Operations and Financial Condition; and Item 8. Financial Statements and Supplementary Data).
We will provide to each person, including any beneficial owner, to whom this prospectus is delivered copies of any of the documents incorporated by PricewaterhouseCoopersreference into this prospectus, excluding any exhibit to those documents unless the exhibit is specifically incorporated by reference into those documents, at no cost, by written or oral request directed to:
CBS Corporation
51 West 52nd Street
New York, New York 10019
Attention: Investor Relations
Telephone:1-877-CBS-0787
Hogan Lovells US LLP, independent accountants, as stated in their report, which is incorporated herein
by reference.
Washington, D.C., will pass upon the validity of the exchange notes and the guarantees for us and for CBS Operations.
The consolidated financial statements of CBS as of December 31, 1999
and 1998, and for eachmanagement’s assessment of the yearseffectiveness of internal control over financial reporting (which is included in the three-year period ended December 31,
1999,Management’s Report on Internal Control over Financial Reporting) incorporated by reference in this prospectus from the CBS Annualby reference to our Current Report on Form 10-K for the year ended December 31, 1999, as amended on April 28, 2000,8-K dated November 2, 2018 have been audited by KPMGso incorporated in reliance on the report of PricewaterhouseCoopers LLP, an independent accountants as stated in their
report, which is incorporated herein by reference, and uponregistered public accounting firm, given on the authority of said firm as experts in accountingauditing and auditing.
The financial statements of Infinity as of December 31, 1999 and 1998
and for each of the years in the three-year period ended December 31, 1999,
incorporated by reference in this prospectus from Item 8 of Infinity's Annual
Report on Form 10-K for the year ended December 31, 1999, have been audited by
KPMG LLP, independent accountants as stated in their report, which is
incorporated herein by reference, and upon the authority of said firm as experts
in accounting and auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20.
| Item 20. | Indemnification of Directors and Officers |
CBS Corporation and CBS Operations Inc. (each, a “Registrant”) are incorporated in the State of Directors and Officers
Section 145 of the Delaware.
Delaware General Corporation Law permits. Section 145(a) of the General Corporation Law of the State of Delaware (the “Delaware General Corporation Law”) provides that a corporation tomay indemnify any of its directors or officersperson who was or is a party or is threatened to be made a party to any third partythreatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation), by reason of the fact that suchthe person is or was a director, officer, employee or officeragent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys'attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by suchthe person in connection with such action, suit or proceeding if suchthe person acted in good faith and in a manner suchthe person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonreasonable cause to believe that such person'sthe person’s conduct was unlawful. InThe termination of any action, suit or proceeding by judgment, order, settlement, conviction or upon a derivative action, i.e., one byplea of nolo contendere or inits equivalent, shall not, of itself, create a presumption that the right of a corporation, the
corporation is permitted to indemnify directors and officers against expenses
(including attorneys' fees) actually and reasonably incurred by them in
connection with the defense or settlement of an action or suit if they actedperson did not act in good faith and in a manner that theywhich the person reasonably believed to be in or not opposed to the best interests of the corporation, except that no indemnification shall
be made if such person shall have been adjudged liableand, with respect to the corporation,
unless and onlyany criminal action or proceeding, had reasonable cause to the extentbelieve that the court in which the action or suitperson’s conduct was brought shall determine upon application that the defendant directors or
officers are fairly and reasonably entitled to indemnity for such expenses
despite such adjudication of liability.
Expenses, including attorneys' fees, incurred by any such person in
defending any such action, suit or proceeding may be paid or reimbursed by the
corporation in advanceunlawful.
Section 145(b) of the final disposition of such action, suit or
proceeding upon receipt by it of an undertaking of such person to repay such
expenses if it shall ultimately be determinedDelaware General Corporation Law states that such person is not entitled
to be indemnified by the corporation.
Delaware law does not permit a corporation tomay indemnify persons against
judgments in actions brought by or in the right of the corporation unless the
Delaware Court of Chancery approves the indemnification.
Viacom's restated certificate of incorporation provides that eachany person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or proceeding, whether civil, criminal,
administrativesuit by or investigative, becausein the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a Viacom director, officer, employee or officeragent of the corporation, or is or was serving at Viacom'sthe request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys’ fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which the person shall have been adjudged to be liable to the corporation unless and only to the extent that the Delaware Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses as the Delaware Court of Chancery or such other court shall deem proper.
Section 145(c) of the Delaware General Corporation Law provides that to the extent that a present or former director or officer of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsections (a) and (b) of Section 145, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith.
Section 145(d) of the Delaware General Corporation Law states that any indemnification under subsections (a) and (b) of Section 145 (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the present or former director, officer, employee or agent is proper in the circumstances because the person has met the applicable standard of conduct set forth in subsections (a) and (b) of Section 145. Such determination shall be made with respect to a person who is a director or officer at the time of another entity, shall be indemnifiedsuch determination (1) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, (2) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, (3) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion or (4) by the stockholders.
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Section 145(f) of the Delaware General Corporation Law states that the indemnification and held harmlessadvancement of expenses provided by, Viacomor granted pursuant to, the fullest
extent permitted byother subsections of Section 145 shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office.
Section 145(g) of the Delaware law. This right to indemnification also includesGeneral Corporation Law provides that a corporation shall have the right to be paid by Viacom the expenses incurred in connection with that
proceeding in advance of its final disposition to the fullest extent authorized
by Delaware law. This right to indemnification is a contract right. Viacom's
restated certificate of incorporation authorizes its Board of Directors to
indemnify any of Viacom's employees or agents to the extent approved by the
Board of Directors and authorized under Delaware law.
Viacom intendspower to purchase and maintain insurance on behalf of any person who is or was onea director, officer, employee or agent of its directors, officers, employees or agents,the corporation, or is or was serving at the request of Viacomthe corporation as a director, officer, employee or agent of another entitycorporation, partnership, joint venture, trust or other enterprise, against any liability asserted against such person and incurred by such person in any such capacity or arising out of such person’s status as such, whether or not the corporation would have the power to indemnify such person against such liability under the provisions of Section 145.
Section 145(j) of the Delaware General Corporation Law states that the indemnification and advancement of expenses provided by, or granted pursuant to, Section 145 shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person.
Certificate of Incorporation and Bylaws. Pursuant to the certificate of incorporation and/or the bylaws of each Registrant, the Registrant shall indemnify any person who was or is involved in or is threatened to be involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or she is or was a director or officer of the Registrant, or is or was serving at the request of the Registrant as a director or officer (including a trustee) of another corporation, limited liability company, partnership, joint venture, trust or other enterprise, to the fullest extent authorized by the Delaware General Corporation Law, as the same exists or may hereafter be amended, against judgments, fines, amounts paid in settlement and expenses (including attorneys’ fees), actually and reasonably incurred by him or her in connection with such action, suit or proceeding.
The certificate of incorporation of each Registrant provides that, to the fullest extent permissible under the Delaware General Corporation Law, the directors of the Registrant shall not be personally liable to the Registrant or its stockholders for monetary damages for breach of fiduciary duty as a director, except that a director shall be liable to the extent provided by applicable law (1) for any breach of the director’s duty of loyalty to the Registrant or its stockholders, (2) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (3) pursuant to Section 174 of the Delaware General Corporation Law or (4) for any transaction from which the director derived an improper personal benefit.
Indemnification Agreements. The indemnification and advancement of expenses provided by, or granted pursuant to, the indemnification provisions of the certificate of incorporation and/or bylaws of each Registrant shall not be deemed exclusive of any other rights to which a person seeking indemnification or advancement of expenses may be entitled under any statute, bylaw, agreement, vote of stockholders or disinterested directors or otherwise. Without limiting the foregoing, CBS Corporation is authorized to enter into an agreement with any director or officer of CBS Corporation providing indemnification for such person against expenses, including attorneys’ fees, judgments, fines and amounts paid in settlement that result from any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, including any action, suit or proceeding by or in the right of CBS Corporation, that arises by reason of the fact that such person is or was a director or officer of CBS Corporation, or is or was serving at the request of CBS Corporation as a director or officer of another corporation, limited liability company, partnership, joint venture, trust or other enterprise, to the fullest extent allowed by law, except that no such agreement shall provide for indemnification for any actions that constitute fraud, actual dishonesty or willful misconduct. Pursuant to the foregoing authorization, CBS Corporation has entered into indemnification agreements with each of its directors.
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Liability Insurance. Each Registrant may purchase and maintain insurance on behalf of any person who is or was a director or officer of the Registrant, or is or was serving at the request of the Registrant as a director or officer of another corporation, limited liability company, partnership, joint venture, trust or other enterprise against any liability asserted against him or her and incurred by him or her in thatany such capacity, or arising out of his or her status as such, whether or not Viacomthe Registrant would have the power or the obligation to indemnify him or her against thatsuch liability under the provisions of the restated
certificate of incorporation or bylaws. CBS Corporation has purchased certain liability insurance for the officers and directors of Viacom.
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Item 21. Exhibits and Financial Statement Schedules
(a) Exhibits
See the index to exhibits that appears immediately following the
signature pages of this Registration Statement.
(b) Financial Statement Schedules
Not applicable.
Item 22. 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 requiredeach Registrant as permitted by section 10(a)(3)Section 145(g) 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.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement; and
(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.
(2) Delaware General Corporation Law.
| Item 21. | Exhibits and Financial Statement Schedules |
Exhibits
| * | Previously filed as an exhibit to this Registration Statement on Form S-4 of CBS Corporation and CBS Operations Inc. filed on March 2, 2018 (Registration No. 333-223415). |
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| Item 22. | Undertakings |
| (a) | Each undersigned registrant (CBS Corporation and CBS Operations Inc., respectively) 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. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and |
| (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. |
| (2) | That, for the purpose of determining any liability under the Securities Act of 1933, each such 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 the purpose of determining liability under the Securities Act of 1933 to any purchaser: |
Each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be a new
Registration Statement relating topart of and included in 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 anystatement as of the securities being registered which remain unsold at the terminationdate it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part 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)registration statement or Section 15(d) of the Securities Exchange Act of 1934 that ismade in a document incorporated by
reference in this Registration Statement shall beor 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.
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(5) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant, pursuant to the provisions described in Item 20, or otherwise, the
registrant 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 the claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant 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 registrant 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.
(6) To respond to requests for information that is incorporated by reference into the Prospectusregistration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.
| (5) | That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: |
The undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to Items 4, 10(b), 11 or 13this registration statement, regardless of this Form within one
business day of receipt of such request, andthe underwriting method used to sendsell the incorporated documents
by first class mail or other equally prompt means. This includes information
contained in documents filed after the effective date of this Registration
Statement through the date of respondingsecurities to the request.
(7) To supplypurchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a post-effective amendment all information concerning
a transaction,seller to the purchaser and the company being acquired involved therein, that was not the
subject of and included in this Registration Statement when it became effective.
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| (i) | Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
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| (ii) | Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
| (iii) | The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
| (iv) | Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
| (b) | Each undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of CBS Corporation’s annual report pursuant to section 13(a) or section 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 the registration statement 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. |
| (c) | Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, each undersigned registrant 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 registrant of expenses incurred or paid by a director, officer or controlling person of the registrant 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 registrant 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. |
| (d) | Each undersigned registrant hereby undertakes to file an application for the purpose of determining the eligibility of the trustee to act under subsection (a) of section 310 of the Trust Indenture Act (“Act”) in accordance with the rules and regulations prescribed by the Commission under section 305(b)(2) of the Act. |
| (e) | Each undersigned registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request. |
| (f) | Each undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective. |
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the undersigned Registrantregistrant has duly caused this Amendment No. 1 to Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, State of New York, on this 30th7th day of January, 2001.
VIACOM INC.
By: /s/ SUMNER M. REDSTONE
----------------------------------
Name: Sumner M. Redstone
Title: Chief Executive Officer
November 2018.
| CBS CORPORATION | ||||
| By: | /s/ Joseph R. Ianniello | |||
| Name: | Joseph R. Ianniello | |||
| Title: | President and Acting Chief Executive Officer | |||
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Amendment No. 1 to Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature | Title | Date | ||
/s/ Joseph R. Ianniello Joseph R. Ianniello | President and Acting Chief Executive Officer | November 7, 2018 | ||
/s/ Christina Spade Christina Spade | Executive Vice President, | November 7, 2018 | ||
/s/ Lawrence Liding Lawrence Liding | Executive Vice President, Controller and | November 7, 2018 | ||
* Candace K. Beinecke | Director | November 7, 2018 | ||
* Barbara M. Byrne | Director | November 7, 2018 | ||
* Gary L. Countryman | Director | November 7, 2018 | ||
* Brian Goldner | Director | November 7, 2018 | ||
* Linda M. Griego | Director | November 7, 2018 | ||
* Robert N. Klieger | Director | November 7, 2018 | ||
* Martha L. Minow | Director | November 7, 2018 | ||
* Shari Redstone | Director | November 7, 2018 | ||
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Signature | Title | Date | ||
* Susan Schuman | Director | November 7, 2018 | ||
* Strauss Zelnick | Director of the Board) | November 7, 2018 | ||
| * | By: /s/ Lawrence P. Tu Attorney-in-fact for the Directors | November 7, 2018 | ||||
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the undersigned Registrant certifies that it has reasonable grounds to believe that
it meets all the requirements for filing on Form S-4 andregistrant has duly caused this Amendment No. 1 to Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of New York, State of New York, on this 30th7th day of January, 2001.
VIACOM INTERNATIONAL INC.
By: /s/ MEL KARMAZIN
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Name: Mel Karmazin
Title: Chief Executive Officer
November 2018.
| CBS OPERATIONS INC. | ||||
| By: | /s/ Joseph R. Ianniello | |||
| Name: | Joseph R. Ianniello | |||
| Title: | President | |||
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Amendment No. 1 to Registration Statement has been signed by the following persons in the capacities and on the dates indicated.
Signature | Title | Date | ||
/s/ Joseph R. Ianniello Joseph R. Ianniello | President and Director (Principal Executive | November 7, 2018 | ||
/s/ Christina Spade Christina Spade | Executive Vice President, | November 7, 2018 | ||
/s/ Lawrence Liding Lawrence Liding | Executive | November 7, 2018 | ||
/s/ Lawrence P. Tu Lawrence P. Tu | Director | November 7, 2018 | ||
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