-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Hd9d+9RUnliuKJOxBEAMUohOTM9gaq53gGd8giguKBEbDpUHGsv0Y7yZZJyDsyX1 7O/ndGwCXBIrm6qOeOHFXA== 0000950157-99-000537.txt : 19991018 0000950157-99-000537.hdr.sgml : 19991018 ACCESSION NUMBER: 0000950157-99-000537 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 19991012 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CBS CORP CENTRAL INDEX KEY: 0000106413 STANDARD INDUSTRIAL CLASSIFICATION: TELEVISION BROADCASTING STATIONS [4833] IRS NUMBER: 250877540 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: SEC FILE NUMBER: 333-88775 FILM NUMBER: 99726344 BUSINESS ADDRESS: STREET 1: 51 WEST 52ND STREET CITY: NEW YORK STATE: NY ZIP: 10019 BUSINESS PHONE: 2129754321 MAIL ADDRESS: STREET 1: 51 WEST 52ND STREET CITY: NEW YORK STATE: NY ZIP: 10019 FORMER COMPANY: FORMER CONFORMED NAME: WESTINGHOUSE ELECTRIC CORP DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: WESTINGHOUSE ELECTRIC & MANUFACTURING CO DATE OF NAME CHANGE: 19710510 S-3 1 FORM S-3 As filed with the Securities and Exchange Commission on October 12, 1999 Registration Statement No. 333-[ ] - ------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 --------------------------- FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 --------------------------- CBS CORPORATION (Exact name of Registrant as specified in its charter) --------------------------- Pennsylvania 25-0877540 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) --------------------------- 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) --------------------------- Louis J. Briskman, Esq. Executive Vice President and General Counsel CBS Corporation 51 West 52nd Street New York, NY 10019 (212) 975-4321 (Name, address, including zip code, and telephone number, including area code, of agent for service) --------------------------- Copy to: Peter S. Wilson, Esq. Cravath, Swaine & Moore 825 Eighth Avenue New York, NY 10019 (212) 474-1000 --------------------------- Approximate date of commencement of proposed sale to public: From time to time after the effective date of this Registration Statement. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [ ] If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 (the "Securities Act"), other than securities offered only in connection with dividend or interest reinvestment plans, please check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [ ] --------------------------- CALCULATION OF REGISTRATION FEE Proposed Title of Each Proposed Maximum Class of Maximum Aggregate Amount of Securities Amount to be Offering Price Offering Registration To be Registered Registered Per Share(1) Price(1) Fee(2) Common Stock, $1.00 par value 10,141,691 $48.72 $494,103,186 $137,360.69 Series A Preferred Stock Purchase Rights 10,141,691 (3) (3) (3) (1) Estimated solely for the purposes of computing the registration fee pursuant to Rule 457(c) under the Securities Act on the basis of the average of the high and low reported sale prices of the Registrant's Common Stock on the New York Stock Exchange Inc. Composite Tape on October 7, 1999. (2) Calculated by multiplying the aggregate offering amount by .000278. (3) The Series A Preferred Stock Purchase Rights of CBS are attached to and trade with the shares of CBS Common Stock being registered hereby. The value attributable to such Series A Preferred Stock Purchase Rights, if any, is reflected in the market price of CBS Common Stock. The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment that specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. - ---------------------------------------------------------------------------- The information in this Prospectus is not complete and may be changed. The selling shareholder may not sell these securities until the registration statement filed with the Securities and Exchange Commission relating to these securities 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 state where the offer or sale is not permitted. - ---------------------------------------------------------------------------- PROSPECTUS SUBJECT TO COMPLETION, October 12, 1999 10,141,691 SHARES CBS CORPORATION COMMON STOCK ------------------------------------ This Prospectus relates to the proposed sale from time to time of up to an aggregate of 10,141,691 shares of common stock of CBS Corporation, a Pennsylvania corporation, by a selling shareholder. The selling shareholder acquired shares of CBS Series B Participating Preferred Stock in connection with the acquisition by CBS from the selling shareholder of television broadcast station KTVT-TV, Fort Worth/Dallas, Texas, on October 12, 1999. The preferred stock is convertible by the selling shareholder into our common stock at any time and this Prospectus relates to the shares of our common stock issuable to the selling shareholder upon conversion of the preferred stock. In connection with this acquisition, we agreed to register this offering of shares for the benefit of the selling shareholder. The selling shareholder may sell all or any portion of the shares of our common stock in one or more transactions on a stock exchange on which the shares are listed, an underwritten offering or in private, negotiated transactions. The selling shareholder will determine the prices at which it sells the shares. We will not receive any of the proceeds from the sale of the shares by the selling shareholder, but we will pay all registration expenses. The selling shareholder will pay any underwriting discounts and selling commissions in connection with the sale of the shares and, in certain circumstances, marketing expenses incurred in connection with an underwritten offering of the shares. On October 6, 1999, 705,713,187 shares of our common stock were outstanding. Our common stock is listed on the New York Stock Exchange under the symbol "CBS." On October 11, 1999, the last reported sale price of our common stock on the New York Stock Exchange was $48.81 per share. We may amend or supplement this Prospectus from time to time by filing amendments or supplements as required. You should read this entire Prospectus and any amendments or supplements carefully before you make your investment decision. Our principal executive offices are located at 51 West 52nd Street, New York, New York 10019. Our telephone number is (212) 975-4321. ------------------ Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this Prospectus. Any representation to the contrary is a criminal offense. ------------------ The date of this Prospectus is [ ], 1999. TABLE OF CONTENTS Page Where You Can Find More Information.......................................3 Special Note Regarding Forward-looking Statements.........................4 Recent Developments.......................................................5 Use of Proceeds...........................................................5 Selling Shareholder.......................................................5 Plan of Distribution......................................................7 Legal Matters.............................................................9 Experts...................................................................9 WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and special reports, proxy statements and other information with the Securities and Exchange Commission. You may read and copy any document we file at the SEC's Public Reference Room at 450 Fifth Street N.W., Washington, D.C. 20549. Please call 1-800-SEC-0330 for further information on the operation of the Public Reference Room. Reports, proxy statements and other information regarding issuers that file electronically with the SEC, including our filings, are also available to the public from the SEC's web site at "http://www.sec.gov." The SEC allows us to "incorporate by reference" the information in documents we file with them, which means that we can disclose important business and financial information about us to you that is not included in or delivered with this Prospectus by referring you to those documents. The information incorporated by reference is considered to be part of this Prospectus. Information that we file later with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below and any filing we will make with the SEC under Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 following the date of this Prospectus: o Annual Report on Form 10-K, as amended by Form 10-K/A, for the year ended December 31, 1998 o Quarterly Report on Form 10-Q, as amended by Form 10-Q/A, for the quarterly period ended March 31, 1999, and Quarterly Report on Form 10-Q for the quarterly period ended June 30, 1999 o Current Reports on Form 8-K filed on January 29, 1999, February 5, 1999, April 1, 1999, April 13, 1999, April 30, 1999, June 4, 1999, June 28, 1999, July 30, 1999, August 4, 1999, September 8, 1999, September 15, 1999, October 8, 1999 (including King World Productions, Inc. historical financial statements), October 8, 1999 (including Viacom Inc. historical financial statements) and October 12, 1999 (including amended and restated Viacom/CBS merger agreement) o Description of risk factors contained in our Registration Statement on Form S-4 (Registration Statement No. 333-84761), filed on August 9, 1999 o Description of risk factors and unaudited pro forma financial information relating to the Viacom Inc./CBS and the CBS/King World Productions, Inc. transactions contained in our Preliminary Joint Proxy Statement dated October 7, 1999, filed in connection with our pending merger with Viacom Inc. o Description of our common stock contained in our Registration Statement on Form 10 dated May 15, 1935 You may request a copy of these filings, at no cost, by writing or telephoning us at the following address: Louis J. Briskman, Esq. Executive Vice President and General Counsel CBS Corporation 51 West 52nd Street New York, New York 10019 Telephone requests may be directed to (212) 975-4321. We have not authorized anyone to give any information or make any representation about us that differs from or adds to the information in this Prospectus or in our documents or the documents that we publicly file with the SEC. Therefore, if anyone does give you different or additional information, you should not rely on it. If you are in a jurisdiction where it is unlawful to offer to exchange or sell, or to ask for offers to exchange or sell, the securities offered by this Prospectus, or if you are a person to whom it is unlawful to direct such activities, then the offer presented by this Prospectus does not extend to you. The information contained in this Prospectus speaks only as of its date unless the information specifically indicates that another date applies. SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS This Prospectus and the documents incorporated by reference in 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 of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements are not based on historical facts, but rather reflect CBS' current expectations concerning future results and events. These forward-looking statements generally can be identified by use of statements that include phrases such as "believe," "expect," "anticipate," "intend," "plan," "foresee," "likely," "will" 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 which may cause the actual results, performance or achievements of CBS to be different from any future results, performance and achievements expressed or impled by these statements. You should review carefully all information, including the financial statements and the notes to the financial statements, included or incorporated by reference in this Prospectus. The following important factors could affect future results, causing these results to differ materially from those expressed in our forward-looking statements: o the timing, impact and other uncertainties related to pending and future acquisitions by CBS and the Viacom transaction; o the ability of CBS to develop and acquire television programming and to attract and retain advertisers; o the ability of CBS to increase audience share for its programs, particularly in key demographic segments; o the ability of CBS to renew existing programming, licensing and distribution agreements and to enter into new agreements; o the success of CBS and its suppliers and customers in achieving year 2000 compliance; o the impact of significant competition from both the over-the-air broadcast stations and programming alternatives such as cable television, wireless cable, in-home satellite distribution services and pay-per-view and home video entertainment services; o the impact of new technologies; o changes in laws or rules or regulations of a governmental agency, including the Federal Communications Commission regulations; o dependence upon affiliation agreements; o expenditures by advertisers tend to be seasonal and cyclical; 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 factors are not necessarily all of the important factors that could cause actual results to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could have material adverse effects on our future results. The forward-looking statements included or incorporated by reference in this Prospectus are made only as of the date of this Prospectus and under Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 we do not have any obligation to publicly update any forward-looking statements to reflect subsequent events or circumstances. We cannot assure you that projected results or event will be achieved. RECENT DEVELOPMENTS On September 6, 1999, we entered into an agreement with Viacom Inc. ("Viacom") providing for the merger of CBS and Viacom, and that agreement was amended and restated as of October 8, 1999. Under the terms of the amended and restated merger agreement, our shareholders will receive, for each share of our common stock, 1.085 shares of Viacom non-voting Class B common stock and for each share of our Series B Participating Preferred Stock, 1.085 shares of Viacom Series C Preferred Stock. The transaction is subject to a number of closing conditions, including Federal Communications Commission approval, expiration of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 waiting period and the adoption of the amended and restated merger agreement by our shareholders. We expect the merger to close sometime during the first half of 2000. You may access our Form 8-K filed on October 12, 1999 for a copy of the amended and restated CBS/Viacom merger agreement and additional information regarding the merger. See "Where You Can Find More Information." USE OF PROCEEDS We will not receive any of the proceeds from the sale of the shares by the selling shareholder. SELLING SHAREHOLDER The following table sets forth the total number of shares of our common stock the selling shareholder would own upon conversion of all the shares of our Series B Participating Preferred Stock owned by the selling shareholder. Because the selling shareholder may offer all or any portion of the shares of our common stock pursuant to the offering contemplated by this Prospectus, we can provide no estimate as to the exact number of shares the selling shareholder will hold after completion of this offering. The selling shareholder has not had any material relationship with CBS (other than as described below or in connection with the acquisition of KTVT-TV from the selling shareholder) within the past three years. All such information has been provided to us by the selling shareholder. Number of Shares Percent of Number of Shares Name of Selling Beneficially Outstanding Registered For Shareholder Owned Shares(1) Sale Hereby Gaylord Entertainment Company 10,141,691(2) 1.4% 10,141,691 - ----------------------------------------- 1 Percent of total shares of our common stock outstanding as of October 6, 1999. 2 The number of shares beneficially owned is determined under rules promulgated by the SEC, and the information is not necessarily indicative of beneficial ownership for any other purpose. The number of shares beneficially owned excludes any shares of our common stock that might be beneficially owned by directors, executive officers or more than 5% shareholders of the selling shareholder. In September 1997, we acquired The Nashville Network and Country Music Television through a merger with the former parent of the selling shareholder, in which approximately 59 million shares of our common stock were issued to the shareholders of that former parent. In connection with that transaction, we entered into certain arrangements with the selling shareholder, including indemnification, services and non-competition agreements, that are still in effect as of the date of this Prospectus. In addition, prior to the closing of our acquisition of television broadcast station KTVT-TV described below, we had a television network broadcasting affiliation agreement with the selling shareholder relating to KTVT-TV. We also had a television network broadcasting affiliation agreement with the selling shareholder relating to KSTW-TV until June 1997. On October 12, 1999, upon the closing of our acquisition of KTVT-TV from the selling shareholder, we issued to the selling shareholder 10,141.691 shares of our Series B Participating Preferred Stock. The preferred stock is convertible by the selling shareholder at any time prior to the consummation of the CBS/Viacom transaction into a total of 10,141,691 shares of our common stock. Under the terms of the merger agreement, as amended, governing this transaction, we agreed to register the resale of the shares of our common stock issuable to the selling shareholder upon conversion of the preferred stock and to keep the registration statement covering that transaction, of which this Prospectus is a part, effective for up to two years. The merger agreement provides that we may suspend the use of this Prospectus for a period or periods not to exceed 40 trading days in the aggregate in any 12 month period if we determine in good faith that a suspension is necessary to avoid public disclosures (a) that would interfere or materially adversely affect the negotiation or completion of any acquisitions or divestitures or (b) of pending corporate developments of a nature that would require public disclosure, provided that we will use our reasonable best efforts to keep the length of any blackout period to no more than ten consecutive trading days. For the period ending October 12, 2000, if we exercise our right to suspend the use of this Prospectus, we have agreed to indemnify the selling shareholder in accordance with the following (without duplication): o the selling shareholder must have previously notified us in writing of its intention to sell any or all of the shares, and the selling shareholder must actually sell those shares during the 12 month period immediately following the end of the relevant blackout period and, either, o if the blackout period exceeds ten consecutive trading days, the selling shareholder must suffer a loss on the sale of the shares, measured on a per share basis as the excess, if any, of (1) the lower of (a) the closing price per share of our common stock on the day the selling shareholder receives notice of suspension of the use of this Prospectus and (b) $47.8224 over (2) the higher of (a) the closing price per share of our common stock on the trading day immediately following the last day of the blackout period and (b) the price per share (for each relevant sale) at which the selling shareholder actually sells the shares minus the applicable per share selling discount or commission, if any, up to a maximum indemnity of $7 million, or o if the aggregate number of trading days in all blackout periods exceeds 40, the selling shareholder must suffer a loss on the sale of the shares, measured on a per share basis as the excess, if any, of (1) $47.8224 over (2) the higher of (a) the closing price per share of our common stock on the trading day immediately following the last day of the last of such blackout periods and (b) the price per share (for each relevant sale) at which the selling shareholder actually sells the shares minus the applicable per share selling discount or commission, if any. In addition, we have also agreed to indemnify the selling shareholder if there is a determination that our acquisition of KTVT-TV is taxable to the selling shareholder as a result of our breach of certain representations, warranties or covenants that we made to the selling shareholder in connection with the acquisition. The amount of the indemnity is calculated as the excess of the actual tax liability to the selling shareholder resulting from the transaction over the tax liability that would have resulted had we not breached those representations, warranties or covenants. However, the amount of the indemnity is reduced to the extent the selling shareholder disposes of the preferred stock, or any security received in exchange for the preferred stock, within ten years of the closing of our acquisition of KTVT-TV. Furthermore, our indemnity is not applicable if the selling shareholder has materially contributed in certain respects to the determination that the acquisition is taxable to the selling shareholder. However, in the event that this indemnity is not applicable but we receive a depreciable cost basis in the KTVT-TV assets, we will be required to pay $40 million to the selling shareholder. PLAN OF DISTRIBUTION We are registering this offering of shares on behalf of the selling shareholder. We will pay all costs, expenses and fees related to this registration, including all registration and filing fees, printing expenses, fees and disbursements of our counsel and the selling shareholder's counsel, blue sky fees and expenses and, if we request that the selling shareholder effect an underwritten public offering of any of the shares covered by this Prospectus, all "road show" and other marketing expenses incurred by us or any underwriters that are not otherwise paid by the underwriters. These costs, expenses and fees are estimated to total approximately $[o]. The selling shareholder will pay any underwriting discounts and selling commissions in connection with the sale of the shares and, if the selling shareholder elects to effect an underwritten public offering of the shares covered by this Prospectus, all "road show" and other marketing expenses incurred by us or any underwriters that are not otherwise paid by the underwriters. The selling shareholder may sell the shares from time to time in one or more transactions on one or more exchanges or in alternative trading markets or otherwise, at prices and at terms then prevailing or at prices related to the then current market price, or in negotiated transactions. The selling shareholder will determine the prices at which it sells the shares in these transactions. The selling shareholder may effect these transactions by selling the shares to or through broker-dealers. In effecting sales, broker-dealers engaged by the selling shareholder may arrange for other broker-dealers to participate in the resales. The shares may be sold by one or more, or a combination, of the following: o a firm commitment underwritten public offering, o a block trade in which the broker-dealer attempts to sell the shares as agent but may position and resell a portion of the block as principal to facilitate the transaction, o purchases by a broker-dealer as principal and resale by the broker- dealer for its account pursuant to this Prospectus, o an exchange distribution in accordance with the rules of the applicable exchange, o ordinary brokerage transactions and transactions in which the broker solicits purchasers and o privately negotiated transactions. The selling shareholder may enter into hedging transactions with broker-dealers. In these transactions, broker-dealers may engage in short sales of our common stock in the course of hedging the positions they assume with the selling shareholder. The selling shareholder also may sell our common stock short pursuant to this Prospectus and redeliver the shares to close out these short positions. The selling shareholder may enter into option or other transactions with broker-dealers that require the delivery to the broker-dealer of the shares. The broker-dealer may then resell or otherwise transfer the shares pursuant to this Prospectus. The selling shareholder also may loan or pledge the shares to a broker-dealer. The broker-dealer may then sell the loaned shares or, upon a default by the selling shareholder, the broker-dealer may sell the pledged shares pursuant to this Prospectus. The selling shareholder may engage in other financing transactions that may include forward contract transactions or borrowings from financial institutions in which the shares are pledged as security. In connection with any of these forward contract transactions, the selling shareholder would pledge the shares to secure its obligations and the counterparty to these transactions would sell our common stock short to hedge its transaction with the selling shareholder. Upon a default by the selling shareholder under any of these financings, including a forward contract transaction, the pledgee or its transferee may sell the pledged shares pursuant to this Prospectus. Broker-dealers or agents may receive compensation in the form of commissions, discounts or concessions from the selling shareholder. Broker- dealers or agents may also receive compensation from the purchasers of the shares for whom they act as agents or to whom they sell as principals, or both. Compensation to a particular broker-dealer may be in excess of customary commissions and will be in amounts to be negotiated in connection with the sale. Broker-dealers or agents and any other participating broker-dealers or the selling shareholder may be deemed to be "underwriters" within the meaning of Section 2(11) of the Securities Act of 1933 in connection with sales of the shares. Accordingly, any commission, discount or concession received by them and any profit on the resale of the shares purchased by them may be deemed to be underwriting discounts or commissions under the Securities Act of 1933. Because the selling shareholder may be deemed to be an "underwriter" within the meaning of Section 2(11) of the Securities Act of 1933, the selling shareholder will be subject to the prospectus delivery requirements of the Securities Act of 1933. The selling shareholder has advised us that it has not entered into any agreements, understandings or arrangements with any underwriters or broker-dealers regarding the sale of the shares. The shares will be sold only through registered or licensed brokers or dealers if required under applicable state securities laws. In addition, in certain states the shares may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from registration or qualification is available and is complied with. The selling shareholder will be subject to applicable provisions of the Securities Exchange Act of 1934 and their associated rules and regulations, including Regulation M, which provisions may limit the timing of purchases and sales of shares of our common stock by the selling shareholder. We will make copies of this Prospectus available to the selling shareholder and have informed it of the need for delivery of copies of this Prospectus to purchasers at or prior to the time of any sale of the shares. We will file a supplement to this Prospectus, if required, pursuant to Rule 424(b) under the Securities Act of 1933 upon being notified by the selling shareholder that any material arrangement has been entered into with an underwriter or a broker-dealer for the sale of the shares through an underwritten offering or a block trade, special offering, exchange distribution or secondary distribution, purchase by a broker or dealer or hedging or financing transaction with the selling shareholder. The supplement will disclose: o the name of each underwriter or participating broker-dealer, o the number of shares involved, o the price at which the shares will be sold, o any commissions paid or discounts or concessions allowed to underwriters or broker-dealers, o if applicable, that the broker-dealer(s) did not conduct any investigation to verify the information set out or incorporated by reference in this Prospectus and o other facts material to the transaction. The selling shareholder may agree to indemnify any underwriter, broker-dealer or agent that participates in transactions involving sales of the shares against certain liabilities, including liabilities arising under the Securities Act of 1933. We have agreed to indemnify the selling shareholder and any underwriters against certain liabilities in connection with the offering of the shares, including liabilities arising under the Securities Act of 1933. LEGAL MATTERS Louis J. Briskman, Esq., our Executive Vice President and General Counsel, has passed upon the validity with respect to the issuance of our shares of common stock offered by this Prospectus. As of October 12, 1999, Mr. Briskman beneficially owned 397,252 shares of our common stock, including 395,000 shares of our common stock issuable upon the exercise of stock options. EXPERTS The consolidated financial statements and the related financial statement schedule of CBS, as of December 31, 1998 and 1997 and for each of the years in the three year period ended December 31, 1998, incorporated by reference in this Prospectus from CBS' Form 10-K, as amended by Form 10-K/A, for the year ended December 31, 1998, have been audited by KPMG LLP, independent auditors, as stated in their reports, which are incorporated in this document by reference, and have been so incorporated in reliance upon the reports of such firm given upon their authority as experts in accounting and auditing. The consolidated financial statements of King World Productions, Inc., as of August 31, 1998 and 1997 and for each of the years in the three year period ended August 31, 1998, incorporated by reference in this Prospectus from CBS' Form 8-K dated October 8, 1999, have been audited by Arthur Andersen LLP, independent public accountants, as indicated in their report with respect thereto and is incorporated by reference in this document in reliance upon the authority of said firm as experts in giving said report. The consolidated financial statements of Viacom Inc., as of December 31, 1998 and 1997, and for each of the three years in the period ended December 31, 1998, incorporated by reference in this Prospectus from CBS' Form 8-K dated October 8, 1999, have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, independent accountants, given on the authority of that firm as experts in auditing and accounting. PART II INFORMATION NOT REQUIRED IN PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. o The following table sets forth the costs and expenses payable by us in connection with the registration of the offering of the shares. All expenses other than the SEC registration fee are estimates. The selling shareholder will pay all costs and expenses of selling its shares, including any underwriting discounts and selling commissions and, if the selling shareholder (rather than CBS) at its election undertakes to sell the shares in an underwritten offering, all "road show" and other marketing expenses incurred by us or any underwriters which are not otherwise paid by such underwriters. SEC Registration Fee........................... ....... $ Accounting Fees and Expenses........................... Legal Fees and Expenses................................ Printing Fees and Expenses............................. Miscellaneous Expenses................................. ------------------ Total................................ $ ================== ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS. CBS is incorporated under the laws of the Commonwealth of Pennsylvania. Section 1741 of the Pennsylvania Business Corporation Law ("PBCL") empowers a Pennsylvania corporation to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or proceeding (a "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 such person is or was a representative of the corporation or is or was serving at the request of the corporation as a representative of another corporation or enterprise, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him or her in connection with such Proceeding, if he or she acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the corporation and, with respect to any criminal proceeding, had no reasonable cause to believe his or her conduct was unlawful. Section 1742 of the PBCL empowers a corporation to indemnify any person who was or is a party, or is threatened to be made a party, to any threatened, pending or completed action by or in the right of the corporation to procure a judgment in its favor by reason of the fact that such person is or was a representative of the corporation or is or was serving at the request of the corporation as a representative of another corporation or enterprise, against expenses (including attorneys' fees) actually and reasonably incurred by him or her in connection with the defense or settlement of the action if he or she acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the best interests of the corporation, provided that indemnification will not be made in respect of any claim, issue or matter as to which such person has been adjudged to be liable to the corporation unless there is a judicial determination that in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for the expenses that the court deems proper. Section 1743 of the PBCL provides that to the extent that a representative of a corporation has been successful on the merits or otherwise in defense of any Proceeding, or in defense of any claim, issue or matter therein, he or she will be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by him or her in connection therewith. Section 1745 of the PBCL provides that expenses (including attorneys' fees) incurred in defending a Proceeding may be paid by the corporation in advance of the final disposition of such Proceeding upon receipt of an undertaking by or on behalf of the representative to repay such amount if it is ultimately determined that he or she is not entitled to be indemnified by the corporation. Section 1746 of the PBCL provides that the indemnification and advancement of expenses provided by, or granted pursuant to, the other sections of the PBCL will not be deemed exclusive of any other rights to which a person seeking indemnification or advancement of expenses may be entitled under any by-law, agreement, vote of shareholders or disinterested directors or otherwise. However, Section 1746 also provides that such indemnification will not be made in any case where the act or failure to act giving rise to the claim for indemnification is determined by a court to have constituted willful misconduct or recklessness. We provide for indemnification of our directors and officers pursuant to Article ELEVEN of our Articles of Incorporation and Article XVII(B) of our By-laws. Article ELEVEN of our Articles of Incorporation and Article XVII(B) of our By-laws provide in effect that, with respect to Proceedings based on acts or omissions on or after January 27, 1987, and unless prohibited by applicable law, we will indemnify directors and officers against all expenses (including attorneys' fees), judgments, fines and amounts paid in settlement incurred in connection with any such Proceedings (subject to certain limitations in the case of actions by such persons against us). Under Article XVII(B), we will also advance amounts to any director or officer during the pendency of any such Proceedings against expenses incurred in connection with such Proceedings, provided that, if required by law, we receive an undertaking to repay such amount if it is ultimately determined that such person is not entitled to be indemnified under such Article. The indemnification provided for in such Articles is in addition to any rights to which any director or officer may otherwise be entitled. Article XVII(B) of our By-laws provides that the right of a director or officer to such indemnification and advancement of expenses will be a contract right and further provides procedures for the enforcement of such right. As authorized by Article ELEVEN of our Articles of Incorporation, we have purchased directors' and officers' liability insurance policies indemnifying our directors and officers and the directors and officers of our subsidiaries against claims and liabilities (with stated exceptions) to which they may become subject by reason of their positions with us or our subsidiaries as directors and officers. ITEM 16. EXHIBITS. EXHIBIT NO. DESCRIPTION 2.1 Agreement and Plan of Merger dated as of March 31, 1999, as amended by Amendment No. 1 dated September 8, 1999, by and among CBS, King World Productions, Inc. and K Acquisition Corp., incorporated by reference to Annex A to the Proxy Statement/Prospectus dated August 9, 1999, which forms a part of our Registration Statement on Form S-4 (Registration No. 333-84761) filed on August 9, 1999, and our Form 8-K dated September 15, 1999 2.2 Agreement and Plan of Merger dated as of April 9, 1999 by and among CBS, Gaylord Entertainment Company, Gaylord Television Company, Gaylord Communications, Inc., CBS Dallas Ventures, Inc. and CBS Dallas Media, Inc. 2.2 Agreement and Plan of Merger dated as of April 9, 1999 by and among CBS, Gaylord Entertainment Company, Gaylord Television Company, Gaylord Communications, Inc., CBS Dallas Ventures, Inc. and CBS Dallas Media, Inc. 2.3 First Amendment dated as of October 8, 1999, to the Agreement and Plan of Merger filed herewith as Exhibit 2.2 2.4 Amended and Restated Tax Matters Agreement dated as of October 8, 1999, by and among CBS, Gaylord Entertainment Company, Gaylord Television Company and Gaylord Communications, Inc. 2.5 Amended and Restated Agreement and Plan of Merger dated as of October 8, 1999 by and among CBS Corporation and Viacom Inc., incorporated by reference to our Form 8-K dated October 12, 1999 3.1 Restated Articles of Incorporation of CBS, as amended to December 11, 1997, incorporated by reference to Exhibit 3(b) to our Form 10-K for the year ended December 31, 1997, and the Statement With Respect to Shares that forms a part of our Restated Articles of Incorporation and is filed herewith 3.2 By-laws of CBS, as amended to May 4, 1999, incorporated by reference to Exhibit 3(b) to our Form 10-Q for the quarterly period ended June 30, 1999 4.1 The rights of holders of our common stock set forth in our Restated Articles of Incorporation and By-laws that are included in Exhibits 3.1 and 3.2. 4.2 The rights of holders of our Series A Preferred Stock Purchase Rights set forth in our Rights Agreement that is incorporated by reference to Exhibit 1 to our Form 8-A filed on January 9, 1996. 5.1 Opinion of Louis J. Briskman, Esq. 23.1 Consent of KPMG LLP 23.2 Consent of Arthur Andersen LLP 23.3 Consent of PricewaterhouseCoopers LLP 23.4 Consent of Louis J. Briskman, Esq. (included in opinion filed as Exhibit 5.1) 24.1 Power of Attorney (included in signature page) ITEM 17. UNDERTAKINGS. (a) The undersigned Registrant hereby undertakes: (1) to file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) to include any prospectus required by Section 10(a)(3) of the Securities Act of 1933 (the "Securities Act"); (ii) to reflect in the Prospectus any facts or events arising after the effective date of this 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 this Registration Statement; and (iii) to include any material information with respect to the plan of distribution not previously disclosed in this Registration Statement or any material change to such information in this Registration Statement; provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) above do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Securities and Exchange Commission by the Registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 (the "Exchange Act") that are incorporated by reference in this Registration Statement; (2) that, for the purpose of determining any liability under the Securities Act, 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; and (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. (b) The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange Act that is incorporated by reference in this 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 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, 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 Securities 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 Securities Act and will be governed by the final adjudication of such issue. SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all the requirements for filing on Form S-3 and has duly caused this 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 October 12, 1999. CBS CORPORATION, Registrant by /s/ Fredric G. Reynolds ----------------------------------- Fredric G. Reynolds Executive Vice President and Chief Financial Officer POWER OF ATTORNEY KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Mel Karmazin, Fredric G. Reynolds, Louis J. Briskman and Robert G. Freedline, and each of them, with full power to act without the other, his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any or all amendments to this Registration Statement, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated. SIGNATURE TITLE DATE - ------------------------ ------------------- ------------------ /s/ George H. Conrades - ------------------------ Director October 12, 1999 George H. Conrades /s/Martin C. Dickinson - ------------------------ Director October 12, 1999 Martin C. Dickinson /s/William H. Gray III - ------------------------ Director October 12, 1999 William H. Gray III /s/Mel Karmazin - ------------------------ President and Chief October 12, 1999 Mel Karmazin Executive Officer and Director (principal executive officer) /s/Jan Leschly - ------------------------ Director October 12, 1999 Jan Leschly /s/Leslie Moonves - ------------------------ President and Chief October 12, 1999 Leslie Moonves Executive Officer, CBS Television, and Director /s/David T. McLaughlin - ------------------------ Chairman and Director October 12, 1999 David T. McLaughlin /s/Richard R. Pivirotto - ------------------------ Director October 12, 1999 Richard R. Pivirotto /s/Raymond W. Smith - ------------------------ Director October 12, 1999 Raymond W. Smith /s/Dr. Paula Stern - ------------------------ Director October 12, 1999 Dr. Paula Stern /s/Robert D. Walter - ------------------------ Director October 12, 1999 Robert D. Walter /s/Fredric G. Reynolds - ------------------------ Executive Vice President October 12, 1999 Fredric G. Reynolds and Chief Financial Officer (principal financial officer) /s/Robert G. Freedline - ------------------------ Vice President and October 12, 1999 Robert G. Freedline Controller (principal accounting officer) INDEX TO EXHIBITS EXHIBIT NO. DESCRIPTION 2.1 Agreement and Plan of Merger dated as of March 31, 1999, as amended by Amendment No. 1 dated September 8, 1999, by and among CBS, King World Productions, Inc. and K Acquisition Corp., incorporated by reference to Annex A to the Proxy Statement/Prospectus dated August 9, 1999, which forms a part of our Registration Statement on Form S-4 (Registration No. 333-84761) filed on August 9, 1999, and our Form 8-K dated September 15, 1999 2.2 Agreement and Plan of Merger dated as of April 9, 1999 by and among CBS, Gaylord Entertainment Company, Gaylord Television Company, Gaylord Communications, Inc., CBS Dallas Ventures, Inc. and CBS Dallas Media, Inc. 2.3 First Amendment dated as of October 8, 1999, to the Agreement and Plan of Merger filed herewith as Exhibit 2.2 2.4 Amended and Restated and Tax Matters Agreement dated as of October 8, 1999, by and among CBS, Gaylord Entertainment Company, Gaylord Television Company and Gaylord Communications, Inc. 2.5 Amended and Restated Agreement and Plan of Merger dated as of October 8, 1999 by and among CBS Corporation and Viacom Inc., incorporated by reference to our Form 8-K dated October 12, 1999 3.1 Restated Articles of Incorporation of CBS, as amended to December 11, 1997, incorporated by reference to Exhibit 3(b) to our Form 10-K for the year ended December 31, 1997, and the Statement With Respect to Shares that forms a part of our Restated Articles of Incorporation and is filed herewith 3.2 By-laws of CBS, as amended to May 4, 1999, incorporated by reference to Exhibit 3(b) to our Form 10-Q for the quarterly period ended June 30, 1999 4.1 The rights of holders of our common stock set forth in our Restated Articles of Incorporation and By-laws that are included in Exhibits 3.1 and 3.2. 4.2 The rights of holders of our Series A Preferred Stock Purchase Rights set forth in our Rights Agreement that is incorporated by reference to Exhibit 1 to our Form 8-A filed on January 9, 1996. 5.1 Opinion of Louis J. Briskman, Esq. 23.1 Consent of KPMG LLP 23.2 Consent of Arthur Andersen LLP 23.3 Consent of PricewaterhouseCoopers LLP 23.4 Consent of Louis J. Briskman, Esq. (included in opinion filed as Exhibit 5.1) 24.1 Power of Attorney (included in signature page) EX-2.2 2 AGREEMENT AND PLAN OF MERGER AGREEMENT AND PLAN OF MERGER BY AND AMONG GAYLORD ENTERTAINMENT COMPANY, GAYLORD TELEVISION COMPANY, GAYLORD COMMUNICATIONS, INC., CBS CORPORATION, CBS DALLAS VENTURES, INC. AND CBS DALLAS MEDIA, INC. i TABLE OF CONTENTS SECTION 1. BASIC PROVISIONS............................................2 SECTION 1.1. MERGERS................................................2 SECTION 1.2. CLOSING................................................2 SECTION 1.3. EFFECTIVE TIME.........................................2 SECTION 1.4. EFFECTS OF THE MERGERS.................................3 SECTION 1.5. ARTICLES AND CERTIFICATE OF INCORPORATION..............3 SECTION 1.6. BYLAWS.................................................3 SECTION 1.7. OFFICERS AND DIRECTORS OF SURVIVING CORPORATIONS.......3 SECTION 1.8. EFFECT ON CAPITAL STOCK OF THE MERGING COMPANIES.......4 SECTION 1.9. ISSUANCE OF CBS COMMON STOCK...........................4 SECTION 1.10. COMMERCIAL SPOTS......................................4 SECTION 1.11. TAX MATTERS AGREEMENT.................................5 SECTION 1.12. PRORATION OF CAPITAL EXPENDITURES.....................5 SECTION 1.13. PRORATION OF CURRENT ASSETS AND LIABILITIES...........6 SECTION 2. REPRESENTATIONS AND WARRANTIES OF GAYLORD...................9 SECTION 2.1. ORGANIZATION; QUALIFICATION; POWER.....................9 SECTION 2.2. AUTHORITY; ABSENCE OF CONFLICTING AGREEMENTS...........9 SECTION 2.3. CAPITALIZATION; OWNERSHIP.............................11 SECTION 2.4. FINANCIAL STATEMENTS..................................11 SECTION 2.5. ABSENCE OF MATERIAL ADVERSE EFFECT....................12 SECTION 2.6. TAXES.................................................12 SECTION 2.7. PERMITS...............................................13 SECTION 2.8. REAL PROPERTY.........................................14 SECTION 2.9. ASSETS OTHER THAN REAL PROPERTY.......................15 SECTION 2.10. ASSETS AND LIABILITIES OF THE LIMITED PARTNERSHIP....16 SECTION 2.11. EMPLOYEES............................................16 SECTION 2.12. EMPLOYMENT AND SIMILAR AGREEMENTS....................16 SECTION 2.13. ERISA................................................16 SECTION 2.14. LABOR MATTERS........................................17 SECTION 2.15. INTELLECTUAL PROPERTY................................17 SECTION 2.16. CONTRACTS............................................18 SECTION 2.17. STATUS OF CONTRACTS..................................21 SECTION 2.18. LITIGATION...........................................21 SECTION 2.19. COMPLIANCE WITH APPLICABLE LAWS......................21 SECTION 2.20. ENVIRONMENTAL MATTERS................................21 SECTION 2.21. FCC MATTERS..........................................22 SECTION 2.22. NO FINDER............................................23 SECTION 2.23. INSURANCE............................................23 SECTION 2.24. YEAR 2000............................................23 SECTION 2.25. TRANSACTIONS WITH AFFILIATES.........................23 SECTION 2.26. CABLE MATTERS........................................23 SECTION 2.27. DIGITAL TELEVISION...................................24 SECTION 3. REPRESENTATIONS AND WARRANTIES OF CBS......................24 SECTION 3.1. ORGANIZATION; QUALIFICATION; POWER....................25 SECTION 3.2. CBS COMMON STOCK TO BE ISSUED IN THIS TRANSACTION.....25 SECTION 3.3. AUTHORITY; ABSENCE OF CONFLICTING AGREEMENTS..........25 SECTION 3.4. SEC DOCUMENTS; UNDISCLOSED LIABILITIES................27 SECTION 3.5. NO FINDER.............................................27 SECTION 3.6. STATUS OF CBS AND THE CBS SUBSIDIARIES................27 SECTION 3.7. ABSENCE OF CERTAIN CHANGES OR EVENTS..................28 ii SECTION 3.8. LITIGATION............................................28 SECTION 3.9. COMPLIANCE WITH APPLICABLE LAWS.......................28 SECTION 3.10. INTERIM OPERATIONS OF THE CBS SUBSIDIARIES...........28 SECTION 3.11. TAXES................................................29 SECTION 4. ACTIONS PRIOR TO THE CLOSING DATE..........................29 SECTION 4.1. PRESERVE ACCURACY OF REPRESENTATIONS AND WARRANTIES...29 SECTION 4.2. FCC CONSENT; IMPROVEMENTS ACT APPROVAL................29 SECTION 4.3. OPERATIONS PRIOR TO THE CLOSING DATE..................30 SECTION 4.4. COLLECTION OF ACCOUNTS RECEIVABLE.....................34 SECTION 4.5. PUBLIC ANNOUNCEMENT...................................35 SECTION 4.6. COMPLIANCE WITH LAWS..................................35 SECTION 4.7. ADVICE OF CHANGES.....................................35 SECTION 4.8. NO SOLICITATION.......................................36 SECTION 4.9. OTHER CONSENTS........................................36 SECTION 4.10. NOTICE OF PROCEEDINGS................................36 SECTION 4.11. TRADE AGREEMENTS.....................................36 SECTION 4.12. CONFIDENTIALITY AGREEMENTS...........................37 SECTION 5. ADDITIONAL AGREEMENTS......................................37 SECTION 5.1. SALES, USE AND TRANSFER TAXES, TITLE INSURANCE........37 SECTION 5.2. EMPLOYEES; EMPLOYEE BENEFIT PLANS.....................37 SECTION 5.3. GAYLORD SUBSIDIARIES AND THE LIMITED PARTNERSHIP TO CONTROL OPERATIONS PRIOR TO CLOSING DATE...39 SECTION 5.4. COPYRIGHT ROYALTY TRIBUNAL PAYMENTS...................39 SECTION 5.5. ACCESS TO INFORMATION.................................39 SECTION 5.6. REASONABLE BEST EFFORTS...............................40 SECTION 5.7. USE OF GAYLORD NAME...................................40 SECTION 5.8. ENVIRONMENTAL STUDY...................................41 SECTION 5.9. AGREEMENT NOT TO COMPETE..............................41 SECTION 5.10. WAIVER OF CERTAIN CLAIMS.............................42 SECTION 5.11. RECORDS..............................................42 SECTION 5.12. POST CLOSING MATTERS.................................42 SECTION 6. CONDITIONS PRECEDENT TO OBLIGATIONS OF CBS.................43 SECTION 6.1. CORPORATE ACTION......................................43 SECTION 6.2. WAITING PERIOD; NO RESTRAINT OR INJUNCTION...........43 SECTION 6.3. FCC CONSENT...........................................44 SECTION 6.4. REPRESENTATIONS AND WARRANTIES........................44 SECTION 6.5. NYSE LISTING..........................................44 SECTION 6.6. BREACH OF COVENANT BY GAYLORD.........................44 SECTION 7. CONDITIONS PRECEDENT TO OBLIGATIONS OF GAYLORD.............44 SECTION 7.1. CORPORATE ACTION......................................44 SECTION 7.2. WAITING PERIOD; NO RESTRAINT OR INJUNCTION...........45 SECTION 7.3. FCC CONSENT...........................................45 SECTION 7.4. REGISTRATION OF SHARES................................45 SECTION 7.5. NYSE LISTING..........................................45 SECTION 7.6. TAX MATTERS AGREEMENT BRING DOWN CERTIFICATE..........45 SECTION 7.7. NO MATERIAL ADVERSE CHANGE............................45 SECTION 7.8. TAX OPINION...........................................45 SECTION 7.9. BREACH OF COVENANT BY CBS.............................46 SECTION 8. INDEMNIFICATION............................................46 SECTION 8.1. INDEMNIFICATION BY GAYLORD............................46 SECTION 8.2. INDEMNIFICATION BY CBS................................47 SECTION 8.3. TERMINATION OF INDEMNIFICATION........................48 SECTION 8.4. PROCEDURES............................................48 iii SECTION 8.5. CERTAIN LIMITATIONS...................................50 SECTION 9. TERMINATION................................................50 SECTION 9.1. TERMINATION...........................................50 SECTION 9.2. SPECIFIC PERFORMANCE..................................51 SECTION 9.3. EFFECT OF TERMINATION.................................51 SECTION 10. GENERAL PROVISIONS........................................51 SECTION 10.1. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND OBLIGATIONS..........................................51 SECTION 10.2. CONFIDENTIAL NATURE OF INFORMATION...................51 SECTION 10.3. GOVERNING LAW........................................52 SECTION 10.4. NOTICES..............................................52 SECTION 10.5. SUCCESSOR AND ASSIGNS................................53 SECTION 10.6. ACCESS TO RECORDS AFTER CLOSING......................54 SECTION 10.7. ENTIRE AGREEMENT; AMENDMENTS.........................54 SECTION 10.8. INTERPRETATION.......................................54 SECTION 10.9. WAIVERS..............................................54 SECTION 10.10. EXPENSES............................................55 SECTION 10.11. PARTIAL INVALIDITY..................................55 SECTION 10.12. EXECUTION IN COUNTERPARTS...........................55 SECTION 10.13. DEFINITIONS.........................................55 SECTION 10.14. CONTROLLING PROVISIONS..............................61 SECTION 10.15. RISK OF LOSS........................................61 SECTION 10.16. RESOLUTION OF DISPUTES OVER SATISFACTION OF CONDITIONS..........................................63 1 AGREEMENT AND PLAN OF MERGER THIS AGREEMENT AND PLAN OF MERGER, dated as of April 9, 1999 (the "Agreement"), is made by and among GAYLORD ENTERTAINMENT COMPANY, a Delaware corporation ("Gaylord"), GAYLORD TELEVISION COMPANY, a Delaware corporation and a direct wholly owned subsidiary of Gaylord ("GTC"), GAYLORD COMMUNICATIONS, INC., a Texas corporation and a direct wholly owned subsidiary of Gaylord ("GCI") (GTC and GCI being sometimes referred to herein as the "Gaylord Subsidiaries"), CBS CORPORATION, a Pennsylvania corporation ("CBS"), CBS DALLAS VENTURES, INC., a Delaware corporation and a direct wholly owned subsidiary of CBS ("CBS Dallas Ventures"), and CBS DALLAS MEDIA, INC., a Delaware corporation and a direct wholly owned subsidiary of CBS ("CBS Dallas Media") (CBS Dallas Ventures and CBS Dallas Media being sometimes referred to herein as the "CBS Subsidiaries") (GTC, GCI, CBS Dallas Ventures and CBS Dallas Media being sometimes referred to herein as the "Constituent Corporations"). WITNESSETH: WHEREAS, GAYLORD BROADCASTING COMPANY, L.P., a Texas limited partnership formerly named New Gaylord Broadcasting, L.P. (the "Limited Partnership"), is solely engaged in the business of owning and operating television broadcast station KTVT-TV, Fort Worth/Dallas, Texas (the "Station"); WHEREAS, GCI is the sole general partner of the Limited Partnership, and GTC is the sole limited partner of the Limited Partnership; WHEREAS, the respective Boards of Directors of GCI and CBS Dallas Ventures, and Gaylord and CBS as the respective sole stockholders of GCI and CBS Dallas Ventures, have approved the merger (the "GCI Merger") of CBS Dallas Ventures with and into GCI upon the terms and subject to the conditions set forth in this Agreement, and such Boards of Directors have determined that the GCI Merger is advisable and in the best interests of the respective stockholders of GCI and CBS Dallas Ventures; WHEREAS, the respective Boards of Directors of GTC and CBS Dallas Media, and Gaylord and CBS as the respective sole stockholders of GTC and CBS Dallas Media, have approved the merger (the "GTC Merger" and, together with the GCI Merger, the "Mergers") of CBS Dallas Media with and into GTC upon the terms and subject to the conditions set forth in this Agreement, and such Boards of Directors have determined that the GTC Merger is advisable and in the best interests of the respective stockholders of GTC and CBS Dallas Media; WHEREAS, under the terms of this Agreement, each outstanding share of common stock, no par value, of GCI (the "GCI Stock") issued and outstanding immediately prior to the Effective Time, and each outstanding share of common stock, par value $.001 per share, of GTC (the "GTC Stock") issued and outstanding immediately prior to the Effective Time, shall be converted into the right to receive common stock, par value $1.00 per share, of CBS (the "CBS Common Stock"); and WHEREAS, the parties intend that for federal income tax purposes each of the Mergers qualifies as a "reorganization" within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the "Code"); 2 NOW, THEREFORE, in consideration of the representations, warranties, covenants, conditions and agreements hereinafter set forth, it is hereby agreed among the parties as follows: SECTION 1. BASIC PROVISIONS SECTION 1.1. MERGERS Upon the terms and subject to the conditions of this Agreement, and in accordance with the Texas Business Corporation Act (the "TBCA") and the Delaware General Corporation Law (the "DGCL"), at the Effective Time, CBS Dallas Ventures shall be merged with and into GCI and the separate corporate existence of CBS Dallas Ventures shall cease and GCI shall continue as the "surviving corporation". Upon the terms and subject to the conditions of this Agreement, and in accordance with the DGCL, at the Effective Time, CBS Dallas Media shall be merged with and into GTC and the separate corporate existence of CBS Dallas Media shall cease and GTC shall continue as the "surviving corporation". SECTION 1.2. CLOSING Unless this Agreement shall have been terminated and the transactions herein contemplated shall have been abandoned pursuant to Section 9, and subject to any extension permitted by Section 10.15 or 10.16, the consummation of the Mergers will take place on the third business day after the satisfaction or (subject to applicable law) waiver of the conditions set forth in Sections 6 and 7 (excluding conditions that, by their terms, cannot be satisfied until the Closing Date (as defined below)). The Closing shall be at the offices of Skadden, Arps, Slate, Meagher & Flom, LLP, New York, New York (the "Closing"), unless another date, time or place is agreed to in writing by Gaylord and CBS. The date on which the Closing occurs shall be the "Closing Date". SECTION 1.3. EFFECTIVE TIME As soon as practicable following the Closing, the parties shall (i) file articles of merger (the "GCI Articles of Merger") with respect to the GCI Merger in such form as is required by, and executed and verified in accordance with, the relevant provisions of the TBCA to effectuate the GCI Merger, (ii) obtain a certificate of merger from the Secretary of State of the State of Texas to effectuate the GCI Merger, (iii) file a certificate of merger (the "GCI Certificate of Merger") with respect to the GCI Merger in such form as is required by, and executed in accordance with, the relevant provisions of the DGCL to effectuate the GCI Merger, (iv) file a certificate of merger (the "GTC Certificate of Merger") with respect to the GTC Merger in such form as is required by, and executed in accordance with, the relevant provisions of the DGCL to effectuate the GTC Merger and (v) make all other filings or recordings required under the laws of Delaware and Texas to effectuate the Mergers. The GCI Articles of Merger, the GCI Certificate of Merger and the GTC Certificate of Merger shall specify that the GCI Merger or the GTC Merger, as applicable, shall become effective at 11:59 p.m. on the Closing Date, or at such subsequent time as Gaylord and CBS shall agree and as shall be specified in the GCI Articles of Merger, the GCI Certificate of Merger and the GTC Certificate of Merger (the date and time the respective Mergers become effective being the "Effective Time"). SECTION 1.4. EFFECTS OF THE MERGERS At and after the Effective Time, the Mergers will have the effects set forth, in the case of the GCI Merger, in Article 5.06 of the TBCA and in Section 259 of the DGCL, and in the case of the GTC Merger, in Section 259 of the DGCL. SECTION 1.5. ARTICLES AND CERTIFICATE OF INCORPORATION In the case of the GCI Merger, the articles of incorporation of GCI, as in effect immediately prior to the Effective Time, shall be amended at the Effective time so that Article 1 of such articles of incorporation reads in its entirety as follows: "The name of this Corporation is 'CBS Dallas Ventures, Inc.'", and, as so amended, such articles of incorporation shall be the articles of incorporation of the surviving corporation of the GCI Merger until thereafter changed or amended as provided therein or by applicable law. In the case of the GTC Merger, the certificate of incorporation of GTC, as in effect immediately prior to the Effective Time, shall be amended at the Effective Time so that Article First of such certificate of incorporation reads in its entirety as follows: "The name of this Corporation is 'CBS Dallas Media, Inc.'", and, as so amended, such certificate of incorporation shall be the certificate of incorporation of the surviving corporation of the GTC Merger until thereafter changed or amended as provided therein or by applicable law. SECTION 1.6. BYLAWS The bylaws of GCI, as in effect immediately prior to the Effective Time, shall be the bylaws of the surviving corporation of the GCI Merger at the Effective Time, and the bylaws of GTC, as in effect immediately prior to the Effective Time, shall be the bylaws of the surviving corporation of the GTC Merger at the Effective Time, in each case until thereafter changed or amended as provided therein or by applicable law. SECTION 1.7. OFFICERS AND DIRECTORS OF SURVIVING CORPORATIONS At the Effective Time, the officers and directors of CBS Dallas Ventures shall become the officers and directors of the surviving corporation of the GCI Merger, and the officers and directors of CBS Dallas Media shall become the officers and directors of the surviving corporation of the GTC Merger, until the earlier of their resignation or removal or until their respective successors are duly elected and qualified. Immediately prior to the Effective Time, Gaylord shall cause the then current officers and directors of GCI and GTC to resign. SECTION 1.8. EFFECT ON CAPITAL STOCK OF THE MERGING COMPANIES As of the Effective Time, by virtue of the respective Mergers and without any action on the part of any holder thereof: (i) each issued and outstanding share of common stock, par value $1.00 per share, of CBS Dallas Ventures shall be converted into and become one fully paid and nonassessable share of GCI Stock; (ii) each issued and outstanding share of common stock, par value $1.00 per share, of CBS Dallas Media shall be converted into and become one fully paid and nonassessable share of GTC Stock; and (iii) the aggregate of the shares of GCI Stock and GTC Stock issued and outstanding immediately prior to the Effective Time shall be converted into the right to receive the number of duly authorized, validly issued, fully paid and non-assessable shares of CBS Common Stock determined under Section 1.9 of this Agreement. 4 SECTION 1.9. ISSUANCE OF CBS COMMON STOCK As of the Effective Time, CBS shall issue and deliver to Gaylord one or more certificates registered in the name of Gaylord evidencing in the aggregate the number of shares (rounded to the nearest whole number) of CBS Common Stock equal to the quotient of Four Hundred Eighty-five Million Dollars ($485,000,000) divided by the "Market Price". The "Market Price" means the average of the daily closing prices per share of CBS Common Stock as reported on the NYSE Composite Transactions Tape (as reported by the Wall Street Journal or, if not reported thereby, by another authoritative source mutually selected by Gaylord and CBS) for the fifteen (15) consecutive full NYSE trading days immediately preceding the third full NYSE trading day prior to the date on which the Closing Date shall occur. Gaylord and CBS agree to allocate one percent (1%) and ninety-nine percent (99%) of the CBS Common Stock received by Gaylord hereunder to the GCI Stock and the GTC Stock, respectively. SECTION 1.10. COMMERCIAL SPOTS For a period of ten years following the Closing Date, CBS shall cause the Station to provide commercial advertising spots (the "Spots") to Gaylord, its subsidiaries, and its Affiliates listed on Schedule 1.10 (to the extent such parties remain Gaylord Affiliates at the applicable time) for goods or services of the type offered as of the date hereof (i) by Gaylord and its subsidiaries, and (ii) by Gaylord's Affiliates listed on Schedule 1.10 and as set forth on Schedule 1.10. During the ten-year period, subject to CBS's consent, such consent not to be unreasonably withheld, CBS shall also permit the Spots to be used for future subsidiaries or Affiliates of Gaylord and for additional goods or services of Gaylord or its current or future subsidiaries or Affiliates. The Spots will be provided to Gaylord on the following terms and conditions: (a) During the ten-year period, CBS shall cause the Station to grant to Gaylord an annual credit in a gross amount of $1 million, solely to be applied toward the cost of the Spots. (b) The cost for the Spots will be based upon schedules, which schedules will include rates by program and by day-part no less favorable than the average rates by program and by day- part negotiated by all similarly significant cash-paying customers. It is the intention of the parties that the Spots be placed on a substantially even basis throughout the year, and that Gaylord will request the placement of Spots accordingly, and that CBS shall use all reasonable efforts to accommodate such Gaylord requests. The airing of the Spots will be subject to the Station's normal sales practices including rates, prompt make-goods of like value, and the normal level of preemptability for all similarly significant cash-paying customers. Consistent with Station billing practices, and in no event more than fifteen (15) days after the end of the month in which any Spots air, CBS will cause the Station to provide to Gaylord (i) an invoice which will detail the Spots which aired during the previous month, including the date, time and value assigned to each Spot, and (ii) written confirmation of its compliance with this Agreement on a monthly basis consistent with its standard reporting policies for other commercial advertisers on the Station, which written confirmation shall include actual exhibition time and rate charged. (c) Notwithstanding any of the foregoing, CBS may take such action with respect to the Spots as necessary to comply with the reasonable access by federal candidates and equal time for all candidates provisions of the Communications Act relating to political broadcasting as well as the FCC's rules and policies, applicable laws and CBS's standards and practices. (d) Any unused portion of each annual credit shall expire at the end of the relevant year and shall not be carried forward to any subsequent year, unless such credit is not used due to (i) the preemption or rejection of Spots contemplated by this Section 1.10 or (ii) any other reason which is outside the control of Gaylord. To the extent that any credit exists after the end 5 of any annual period for the reasons set forth in clause (i) or (ii), such credit shall be carried forward to the immediately succeeding annual period; to the extent any such credits are not fully used at the end of the ten (10) year period, Gaylord shall be entitled to an additional eighteen (18) month period during which it may use any such unused credits, at the end of which any remaining credits will expire. CBS and Gaylord agree that the fair market value of the annual credits provided in this Section 1.10 is six million dollars ($6,000,000), it being understood that the determination of the fair market value as provided herein shall not alter the obligation of CBS to provide an annual credit of one million dollars ($1,000,000) for a period of ten (10) years. SECTION 1.11. TAX MATTERS AGREEMENT The parties hereto shall, simultaneously with the execution of this Agreement, enter into that certain Tax Matters Agreement attached hereto as Exhibit A. SECTION 1.12. PRORATION OF CAPITAL EXPENDITURES Gaylord intends to make capital expenditures with respect to the Station, in the ordinary course of business, on an as-needed basis in an amount not to exceed $7,100,000 during the calendar year 1999. Gaylord shall be responsible for 1/365th of this amount per day from January 1, 1999 until the Closing. At the Closing, to the extent Gaylord has spent less than such pro rata amount, Gaylord shall deliver the difference in cash to CBS, and, to the extent Gaylord has spent more than such pro rata amount, CBS shall deliver the difference in cash to Gaylord; provided, however, that (i) during the period prior to the Closing, Gaylord agrees to consult with CBS and shall not make any capital expenditures not otherwise necessary to the operation of the Station in the ordinary course of business, (ii) to the extent Gaylord and CBS agree to a revised amount of capital expenditures for calendar year 1999, the proration referred to herein shall be applied to such revised amount, and (iii) in no event shall CBS be obligated to pay to Gaylord more than $500,000 under the terms of this Section 1.12. If the Closing takes place after December 31, 1999, an arrangement similar to that provided for in this Section 1.12 shall be agreed upon by the parties with respect to capital expenditures in 2000. SECTION 1.13. PRORATION OF CURRENT ASSETS AND LIABILITIES (a) All current assets (excluding any assets to be transferred to Gaylord or any of its Affiliates pursuant to Section 4.3(b)) and all current liabilities (including accounts payable, bonus or other incentive payments payable, other payables, accrued liabilities for talent, accrued salaries and wages, accrued employee benefits, accrued expenses and accrued deferred income or compensation, but excluding any liabilities or expenses relating to Taxes, which are governed by the Tax Matters Agreement, and any liabilities assumed by Gaylord pursuant to Section 4.3(b)) arising from the conduct of the business and operations of the Station shall be prorated between Gaylord and CBS as of the Effective Time, taking into account the elapsed time or consumption of an asset during the month in which the Closing occurs. Such current assets and current liabilities relating to the period prior to such date shall be for the account of Gaylord and those relating to the period thereafter shall be for the account of CBS, and shall be prorated accordingly. (b) There shall be no proration of the payments due under the film or programming license agreements other than for the calendar month in which the Effective Time occurs, and 6 except that Gaylord shall be responsible for any overdue amount under such film or programming license agreements. Any such prorations shall be based upon the due date for payments pursuant to the film and program license agreements. For the purpose of determining the due date for payments due under film or programming license agreements which are silent as to the day of the month on which payment is due, such agreements shall be deemed to provide that the payment is due on the date payment is actually made during the month of Closing. (c) The items included in the current assets and current liabilities referred to above shall be the same items included in the line items "Current assets" and "Current liabilities" on the balance sheet as of February 28, 1999 included in the Financial Statements and such items shall be calculated in accordance with GAAP except that accruals for taxes and, subject to subparagraph (b) above, all film and programming license agreements shall be excluded. (d) At least five days prior to the Closing Date, Gaylord shall provide CBS with an estimated balance sheet as of the Effective Time setting forth a good faith estimate of the pro rata adjustments of current assets and current liabilities contemplated by Section 1.13(a) (and all information reasonably necessary to determine the accuracy of such estimate) on the basis of the then most recently available month-end financial statements of the Station. Any payment required to be made by either party pursuant to such preliminary estimate shall be made by the appropriate party at the Closing in accordance therewith, absent manifest error. CBS shall be required to pay the amount of any current assets prorated to Gaylord for which CBS will receive a corresponding benefit after the Effective Time and which do not relate to the period prior to the Effective Time. Gaylord shall be required to pay the amount of any current liabilities prorated to CBS for which Gaylord received a corresponding benefit prior to the Effective Time and which do not relate to the period after the Effective Time. (e) After the Effective Time, the Station shall continue with its rights and obligations (including barter obligations) pursuant to the License Agreement between the Station and Columbia Tristar Television Division for Donnie and Marie dated July 2, 1998 and the License Agreements with Paramount Pictures for Real TV for the 1998-1999 season dated June 2, 1997 and for the 1999-2000 season dated June 29, 1998 (the "Identified Agreements"); provided, however, that Gaylord shall be responsible solely for any cash payments due under the provisions of the Identified Agreements as in effect at the Effective Time; provided, further, that upon the expiration of each of the Identified Agreements, CBS shall promptly account for and pay to Gaylord one-half of gross revenues net of agency commissions received by CBS with respect to each Identified Agreement, it being understood that as part of the aforesaid accounting, CBS shall promptly deliver written documentation confirming the amount of gross revenues net of agency commissions received with respect to each of the Identified Agreements. Under no circumstances will the Station be required to exhibit the programs represented by the Identified Agreements. Within 60 days after the Closing Date, CBS shall prepare and deliver to Gaylord the definitive final balance sheet setting forth final allocations and related purchase price adjustments for the Station (the "Settlement Statement") as of the Effective Time. During the 30-day period following Gaylord's receipt of the Settlement Statement, Gaylord and its independent auditors shall be permitted to review and make copies reasonably required of (i) the working papers of CBS relating to the Settlement Statement and (ii) any supporting schedules, analyses and other documentation relating to the Settlement Statement. The Settlement Statement shall become final and binding upon the parties on the thirtieth (30th) day following delivery thereof, unless Gaylord gives written notice of its disagreement with the Settlement Statement ("Notice of Disagreement") to CBS prior to such date. Any Notice of Disagreement shall specify in reasonable detail the nature 7 of any disagreement so asserted. If a Notice of Disagreement is given to CBS in the period specified, then the Settlement Statement (as revised in accordance with clause (I) or (II) below) shall become final and binding upon the parties on the earlier of (I) the date CBS and Gaylord resolve in writing any differences they have with respect to the matters specified in the Notice of Disagreement or (II) the date any disputed matters are finally resolved in writing by the Accounting Firm (as defined below). Within 10 business days after the Settlement Statement becomes final and binding upon the parties, payment of the difference must be made via wire transfer in immediately available funds, together with interest thereon at the prime rate (as reported by the Wall Street Journal or, if not reported thereby, by another authoritative source) in effect as of the Effective Time, calculated on the basis of the actual number of days elapsed over 365, from the Effective Time to the date of actual payment, compounded annually. During the 30-day period following the delivery of a Notice of Disagreement that complies with the preceding paragraph, CBS and Gaylord shall seek in good faith to resolve in writing any differences that they may have with respect to the matters specified in the Notice of Disagreement. During such period, CBS and its independent auditors shall be permitted to review and make copies reasonably required of (i) the working papers of Gaylord relating to the Notice of Disagreement and (ii) any supporting schedules, analyses and documentation relating to the Notice of Disagreement. If, at the end of such 30-day period, CBS and Gaylord have not so resolved such differences, CBS and Gaylord shall submit to an independent accounting firm (the "Accounting Firm") for review and resolution any and all matters which remain in dispute and which were properly included in the Notice of Disagreement. The Accounting Firm shall be a mutually acceptable internationally recognized independent public accounting firm agreed upon by Gaylord and CBS in writing, which Accounting Firm shall not have been the auditing firm representing CBS or Gaylord during the last two years. If Gaylord and CBS do not agree on the selection of an Accounting Firm within sixty (60) days of the Notice of Disagreement, then the Washington, D.C. office of Ernst & Young shall be the Accounting Firm. Within sixty (60) days after selection of the Accounting Firm, Gaylord and CBS shall submit their respective positions to the Accounting Firm, in writing, together with any other materials relied upon in support of their respective positions. CBS and Gaylord shall use reasonable efforts to cause the Accounting Firm to render a decision resolving the matters in dispute within 30 days following the submission of such materials to the Accounting Firm. CBS and Gaylord agree that judgment may be entered upon the determination of the Accounting Firm in any court having jurisdiction over the party against which such determination is to be enforced. Except as specified in the following sentence, the cost of any arbitration (including the fees and expenses of the Accounting Firm) pursuant to this Section 1.13 shall be borne by CBS and Gaylord in inverse proportion as they may prevail on each matter resolved by the Accounting Firm, which proportionate allocations shall also be determined by the Accounting Firm at the time the determination of the Accounting Firm is rendered on the merits of the matters submitted. The fees and expenses (if any) of CBS's independent auditors and attorneys incurred in connection with the review of any Notice of Disagreement shall be borne by CBS, and the fees and expenses (if any) of Gaylord's independent auditors and attorneys incurred in connection with their review of the Settlement Statement shall be borne by Gaylord. Any payments made pursuant to this Section 1.13 shall (i) in the case of a payment to be made to Gaylord, be treated as being made immediately before the Effective Time by the Limited Partnership to GCI or GTC, as the case may be, and then to Gaylord, and (ii) in the case of a payment to be made by Gaylord, be treated as being made immediately before the Effective Time as a capital contribution by Gaylord to GCI or GTC, as the case may be, and then by such entity to the Limited Partnership. None of Gaylord or any of its subsidiaries, or CBS or any of its subsidiaries, shall take any position inconsistent with the treatment described in the immediately 8 preceding sentence before any Tax Authority except to the extent that a Final Determination causes any such payment not to be so treated. SECTION 2. REPRESENTATIONS AND WARRANTIES OF GAYLORD Gaylord makes the following representations and warranties to CBS as of the date hereof and, subject to the following sentence, as of the Closing Date. The representations and warranties of Gaylord in this Agreement that are qualified as to materiality shall be true and correct, and those not so qualified shall be true and correct in all material respects, as of the Closing Date as though made on the Closing Date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties qualified as to materiality shall be true and correct, and those not so qualified shall be true and correct in all material respects, on and as of such earlier date). SECTION 2.1. ORGANIZATION; QUALIFICATION; POWER The Limited Partnership is a limited partnership duly organized, validly existing and in good standing under the laws of the State of Texas. The Limited Partnership has full power and authority to own or lease and to operate the Station and its assets and to carry on its business as now conducted. GCI is a corporation duly organized, validly existing and in good standing under the laws of the State of Texas. Gaylord is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. GTC is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Each of GCI and GTC has full power and authority to own its respective partnership interest in the Limited Partnership. Each of the Limited Partnership, GTC, Gaylord and GCI is duly qualified to do business as a foreign entity and in good standing under the laws of each state or other jurisdiction in which either the ownership or use of the properties owned or used by it, or the nature of the activities conducted by it, requires such qualification, except where the failure to be so qualified would not reasonably be expected to have a Material Adverse Effect on GTC, GCI and the Limited Partnership, taken as a whole, or impair the ability of Gaylord, the Gaylord Subsidiaries or the Limited Partnership to consummate the transactions contemplated by, or to satisfy their obligations under, the Transaction Agreements, or delay in any material respect or prevent the consummation of any of the transactions contemplated by the Transaction Agreements (a "Gaylord Material Adverse Effect"). Gaylord has delivered to CBS true and complete copies of (i) the charter document and by-laws of each of GTC and GCI and (ii) the Certificate of Limited Partnership and Limited Partnership Agreement of the Limited Partnership (collectively, the "Organizational Documents"), in each case as amended through the date of this Agreement. SECTION 2.2. AUTHORITY; ABSENCE OF CONFLICTING AGREEMENTS (a) Each of Gaylord, GCI, GTC and the Limited Partnership has the power and authority to execute, deliver and perform this Agreement and all of the other agreements and instruments to which it is, or is specified to be, a party and which are to be executed and delivered pursuant hereto (collectively, together with this Agreement, the "Transaction Agreements"), to consummate the transactions contemplated thereby and to comply with the terms, conditions and provisions thereof. (b) The execution, delivery and performance of the Transaction Agreements and the consummation of the transactions contemplated thereby have been duly authorized and approved by all necessary corporate and partnership action on the part of Gaylord, GCI, GTC and the Limited Partnership. Each of Gaylord, GTC, GCI and the Limited Partnership has duly executed 9 and delivered this Agreement and, prior to the Closing, will have duly executed and delivered the other Transaction Agreements to which it is, or is specified to be, a party, and this Agreement constitutes, and each of the other Transaction Agreements to which it is, or is specified to be, a party will upon execution and delivery thereof constitute, its legal, valid and binding agreement enforceable against it in accordance with its respective terms, except in each case as such enforceability may be limited by bankruptcy, moratorium, insolvency, reorganization or other similar laws affecting or limiting the enforcement of creditors' rights generally and except as such enforceability is subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). (c) Except as set forth in Schedule 2.2, neither the execution and delivery by Gaylord, GTC, GCI or the Limited Partnership of any of the Transaction Agreements, the consummation of any of the transactions contemplated thereby nor compliance by Gaylord, GTC, GCI and the Limited Partnership with or fulfillment by any of them of the terms, conditions and provisions thereof will conflict with, or result in a violation or breach of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, amendment, cancellation or acceleration of any obligation or loss of a material benefit under, or to increased, additional, accelerated or guaranteed rights or entitlement of any person under, or result in the creation of any Encumbrance upon any of the properties or assets of the Gaylord Subsidiaries or the Limited Partnership under, (i) any of the Organizational Documents or the charter or by-laws of Gaylord, (ii) any of the terms, conditions or provisions of any note, bond, mortgage, indenture, lease, contract, agreement, obligation, understanding, commitment or other legally binding arrangement or of any license, franchise, permit, concession, certificate of authority, order, approval, application or registration from, of or with a Governmental Entity (as defined below) (a "Permit") to which Gaylord or any of its subsidiaries, including GTC and GCI, or the Limited Partnership, is a party or by which any of their respective properties or assets is or may be bound or (iii) subject to the governmental filings and other matters referred to in Section 2.2(d), any judgment, order, decree, statute, law, ordinance, rule or regulation applicable to Gaylord or any of its subsidiaries, including GTC and GCI, or the Limited Partnership or their respective properties or assets, other than, in the case of clause (ii) or (iii), any such items that individually or in the aggregate have not had and would not have a Gaylord Material Adverse Effect. (d) Except for (i) consents, approvals, licenses, permits, orders, authorizations, registrations, declarations, filings or applications as may be required under, and other applicable requirements of, the Securities Exchange Act of 1934, as amended (the "Exchange Act"), the Securities Act of 1933 (the "Securities Act"), the Improvements Act and any foreign competition laws, (ii) filings under state securities or "blue sky" laws, (iii) filings with the NYSE, (iv) approvals of and filings with the Federal Communications Commission or any successor entity (the "FCC") under the Communications Act, (v) the filing of the GCI Articles of Merger with the Secretary of State of the State of Texas, the filing of the GCI Certificate of Merger and the GTC Certificate of Merger with the Secretary of State of the State of Delaware and the filing of appropriate documents with the relevant authorities of other jurisdictions in which GCI, GTC or the Limited Partnership are qualified to do business and (vi) other consents, approvals, orders, authorizations, registrations, declarations, filings and applications expressly provided for in the Transaction Agreements, no consent, approval, license, permit, order or authorization of, or registration, declaration, filing or application with, any federal, state, local or foreign government, or any court, administrative or regulatory agency or commission or other governmental authority or agency, domestic or foreign (a "Governmental Entity"), is required to be obtained or made by or with respect to Gaylord or any of its subsidiaries, including GCI and GTC, or the Limited Partnership, in connection with the execution, delivery or performance by Gaylord, GCI, GTC and the Limited Partnership of each Transaction Agreement to which any of them is, or is specified to be, a party or the consummation by Gaylord, GCI, GTC and the Limited Partnership of the transactions contemplated thereby (except where the failure to obtain such consents, 10 approvals, licenses, permits, orders or authorizations, or to make such registrations, declarations, filings or applications, would not, individually or in the aggregate, have a Gaylord Material Adverse Effect). SECTION 2.3. CAPITALIZATION; OWNERSHIP The authorized capital stock of GCI consists of 1,000 shares of GCI Stock, all of which shares are issued and outstanding, and the authorized capital stock of GTC consists of 100,000 shares of GTC Stock, of which 100 shares are issued and outstanding. All of the Gaylord Subsidiary Stock is owned beneficially and of record by Gaylord, free and clear of all Encumbrances, and the Gaylord Subsidiary Stock has been duly authorized and validly issued and is fully paid and nonassessable and not subject to preemptive rights. GCI owns the entire general partnership interest in the Limited Partnership, free and clear of all Encumbrances, and such interest is its sole asset. GTC owns the entire limited partnership interest in the Limited Partnership, free and clear of all Encumbrances, and such interest is its sole asset. There are no outstanding securities, options, warrants, calls, rights, commitments, agreements, arrangements or undertakings of any kind to which Gaylord, GTC, GCI or the Limited Partnership is a party or by which any of them is bound obligating Gaylord, GCI, GTC or the Limited Partnership to issue, deliver or sell, or cause to be issued, delivered or sold, additional shares of capital stock or other voting securities of GTC or GCI or additional limited or general partnership interests in the Limited Partnership or obligating Gaylord, GTC, GCI or the Limited Partnership to issue, grant, extend or enter into any such security, option, warrant, call, right, commitment, agreement, arrangement or undertaking. There are no outstanding contractual obligations of GTC, GCI or the Limited Partnership to repurchase, redeem or otherwise acquire any interest in GTC, GCI or the Limited Partnership. There are no outstanding contractual obligations of Gaylord, GTC or GCI to vote or to dispose of any of their respective interests in GTC, GCI or the Limited Partnership. SECTION 2.4. FINANCIAL STATEMENTS Schedule 2.4 contains (a) the unaudited balance sheet (the "Balance Sheet") of GTC, GCI and the Limited Partnership as of February 28, 1999 (the "Financial Statement Date"), (b) the related unaudited statements of income for the two months then ended, and (c) the unaudited balance sheets and related unaudited statements of income as of and for the years ended December 31, 1996, 1997 and 1998 (collectively, the "Financial Statements"). Except as set forth in Schedule 2.4, the Financial Statements have been prepared in accordance with GAAP consistently applied, are complete and correct in all material respects, accurately reflect the books, records and accounts of GTC, GCI and the Limited Partnership (which books and records are accurate and complete in all material respects), and fairly present in all material respects the financial position of GTC, GCI and the Limited Partnership as of their respective dates and the results of their operations for the periods then ended, subject to the absence of footnotes. None of GTC, GCI or the Limited Partnership has any material liabilities or obligations of any nature (whether absolute, accrued, contingent, unasserted or otherwise) except liabilities or obligations (a) which are accrued or reserved against in the Balance Sheet, (b) for Taxes with respect to current operations, or (c) which were incurred after the Financial Statement Date in the ordinary course of business and not in violation of this Agreement. SECTION 2.5. ABSENCE OF MATERIAL ADVERSE EFFECT Except as disclosed in Schedule 2.5, since February 28, 1999, each of GTC, GCI and the Limited Partnership has conducted its business only in the ordinary course consistent with past 11 practice, and there has not been any change, effect, event or occurrence that, individually or in the aggregate, has had or would reasonably be expected to have a Gaylord Material Adverse Effect. SECTION 2.6. TAXES Except as set forth in Schedule 2.6: (a) As used in this Agreement, (i) "Taxes" shall include all federal, state, local or foreign income, property, sales, excise and other taxes or similar governmental charges, including any interest, penalties, or additions with respect thereto; (ii) "Tax Returns" shall mean all returns, reports, declarations, information, estimates, schedules, filings or documents (including any related or supporting information) filed or required by any tax authority to be filed with respect to taxes, including, without limitation, all information returns, claims for refund, amended returns, declarations of estimated tax, and requests for extensions of time to file any item described in this paragraph; and (iii) "Treasury Regulations" refer to the Treasury Department regulations promulgated under the Code; (b) No Encumbrances for Taxes exist with respect to any of the assets or properties of any of GTC, GCI or the Limited Partnership, except for statutory Encumbrances for Taxes not yet due or payable; (c) All federal income Tax Returns and all other material federal, state and local, domestic and foreign Tax Returns required to be filed by or on behalf of any of GTC, GCI or the Limited Partnership, or any consolidated, combined, affiliated or unitary group of which any of GTC, GCI or the Limited Partnership is or has ever been a member, have been timely filed or requests for extensions have been timely filed and any such extensions have been granted and have not expired; (d) Each such Tax Return was complete and correct in all material respects; (e) All material Taxes with respect to taxable periods covered by such Tax Returns and all other material Taxes for which any of GTC, GCI or the Limited Partnership is liable (together, the "Relevant Taxes") have been paid in full, or reserves therefor have been established in accordance with GAAP on the Balance Sheet; (f) All U.S. federal income Tax Returns filed by or on behalf of each of GTC, GCI or the Limited Partnership have been examined by and settled with the Internal Revenue Service, or the statute of limitations with respect to the relevant tax liability has expired, for all taxable periods through and including 1995; (g) All relevant Taxes due with respect to any completed and settled audit, examination or deficiency litigation with any tax authority have been paid in full; (h) There is no audit, examination, deficiency, or refund litigation pending with respect to any relevant Taxes and no requests pending for waivers of the time to assess any relevant Taxes and no tax authority has given written notice of the commencement of any audit, examination or deficiency litigation, with respect to any relevant Taxes; and (i) None of GTC, GCI or the Limited Partnership is bound by any written agreement or arrangement with respect to Taxes. 12 SECTION 2.7. PERMITS Except as set forth in Schedule 2.7, each of GTC, GCI and the Limited Partnership legally owns, holds or possesses all FCC Authorizations and all other material Permits which are reasonably necessary to entitle it to own or lease, operate and use the Station and its assets and to carry on and conduct the Station's business as currently conducted. Schedule 2.7 sets forth a list and brief description of each such FCC Authorization and other material Permit held by each of GTC, GCI and the Limited Partnership. Each of GTC, GCI and the Limited Partnership has fulfilled and performed in all material respects its obligations under each such FCC Authorization and other material Permit, and no event has occurred or condition or state of facts exists which constitutes or, after notice or lapse of time or both, would constitute grounds for revocation or termination of any such FCC Authorization or other material Permit, or the imposition of any materially adverse restriction or limitation on the operation of the Station. Except as set forth on Schedule 2.7, no application, action or proceeding is pending for the renewal or modification of any of such FCC Authorizations or other material Permits, and no notice of cancellation, of default or of any dispute concerning any such FCC Authorization or other material Permit, or of any event, condition or state of facts described in the preceding sentence, has been received by any of Gaylord, GTC, GCI or the Limited Partnership. Except as set forth on Schedule 2.7, each of such FCC Authorizations and other material Permits is valid, subsisting and in full force and effect. The Station's operations are limited only by the conditions and restrictions specified in the FCC Authorizations or other material Permits and by the FCC's and the FAA's rules and policies and by the Communications Act, and, except for matters affecting the television broadcasting industry generally, are not subject to any condition or restriction which would limit in any material respect the operation of the Station as currently conducted. Subject to the receipt of the FCC Consent and any other governmental consents expressly required by the Transaction Agreements, to the best knowledge of Gaylord, GTC, GCI and the Limited Partnership, upon consummation of the Mergers, such FCC Authorizations and other material Permits will remain vested in the Limited Partnership immediately after the Effective Time and, at such time, will be in full force and effect, in each case without (a) the occurrence of any material breach, default or forfeiture of rights thereunder or (b) the consent, approval, or act of, or the making of any filing with, any other Governmental Entity or other party. Except as set forth on Schedule 2.7, the Limited Partnership has operated the Station in all material respects in accordance with such FCC Authorizations and other material Permits and in compliance in all material respects with the Communications Act and all other laws and regulations, federal, state, local and foreign, applicable to the Station. Except as set forth on Schedule 2.7, none of the Limited Partnership, Gaylord, GCI nor GTC has received any notice of any violations of such FCC Authorizations, the Communications Act or any other applicable laws and regulations. Except as set forth on Schedule 2.7, there is no action by or before the FCC currently pending or, to the best knowledge of Gaylord, GTC, GCI and the Limited Partnership, threatened to revoke, cancel, rescind, suspend, modify or refuse to renew in the ordinary course any of the FCC Authorizations. Except as set forth on Schedule 2.7, to the best knowledge of Gaylord, GTC, GCI and the Limited Partnership, there is no reasonable basis for the initiation or issuance by the FCC of any investigation, proceeding or notice of material violation with respect to the Station. SECTION 2.8. REAL PROPERTY Schedule 2.8 contains (i) a brief description of all real property and interests in real property owned (the "Owned Property") by the Limited Partnership (showing the record title holder, legal description, location, improvements and any indebtedness secured by a mortgage or other Encumbrance thereon) and (ii) with respect to real property or interests in real property leased (the "Leased Property") by the Limited Partnership, a list and brief description of each lease (a "Lease") or similar agreement (showing the rental, expiration date, renewal, the uses being made thereof and 13 the location of the real property covered by such lease or other agreement). The Limited Partnership has good and sufficient, valid and marketable title to the Owned Property and good and valid leasehold title to the Leased Property, in each case free and clear of all Encumbrances, except (A) such Encumbrances as are set forth in Schedule 2.8, (B) Encumbrances described in clauses (3), (4) and (5) of Section 2.9(c), (C) leases, subleases and similar agreements set forth in Schedule 2.16, (D) easements, covenants, rights-of-way and other similar restrictions of record and (E) (i) zoning, building and other similar restrictions, (ii) Encumbrances that have been placed by any developer, landlord or other third party on property over which the Limited Partnership has easement rights or on any Leased Property and subordination or similar agreements relating thereto and (iii) unrecorded easements, covenants, rights-of-way and other similar restrictions. None of the items set forth in clauses (D) and (E) above, individually or in the aggregate, materially impairs or could reasonably be expected materially to impair, the continued use and operation of the real property to which they relate in the business of the Station as presently conducted. There are (A) no outstanding contracts for any improvements to the Owned Property which have not been fully paid, (B) no expenses of any kind (including brokerage and leasing commissions) pertaining to the Owned Property which have not been fully paid and (C) no outstanding contracts for the sale of any of the Owned Property. All Leases are in full force and effect and grant in all respects the leasehold estates or rights of occupancy or use they purport to grant. Except as provided in Schedule 2.8, the Limited Partnership has not (A) assigned or otherwise transferred any Lease or (B) sublet all or any portion of any Leased Property. There are no existing defaults on the part of the Limited Partnership or, to the best of Gaylord's knowledge, on the part of any other party thereto, in any material respect under any Lease and no event has occurred that, with notice or the lapse of time, or both, would constitute a default on the part of the Limited Partnership or, to the best of Gaylord's knowledge, on the part of any other party thereto, in any material respect under any of the Leases. The consummation of the Mergers and the transactions contemplated hereby will not result in the occurrence of a default under any of the Leases subject to the receipt of any necessary consents (whether pursuant to a "change in control" or assignment provision in the Leases or otherwise). The Parkerville Park Lease Agreement set forth on Schedule 2.16 with respect to a portion of the Owned Property does not materially interfere with the business and operations of the Station as currently conducted. SECTION 2.9. ASSETS OTHER THAN REAL PROPERTY (a) The Limited Partnership has good and valid title to all assets reflected on the Balance Sheets or thereafter acquired, except for those sold or otherwise disposed of for fair value since the Financial Statement Date in the ordinary course of business consistent with past practice and not in violation of this Agreement, in each case free and clear of all Encumbrances except Permitted Encumbrances (as defined below). Schedule 2.9(a) sets forth a true and complete list of all assets properly categorized as plant, property and equipment reflected on the Balance Sheet and acquired after December 31, 1993, and a summary of assets acquired prior to that date by general category. All the material tangible personal property owned by the Limited Partnership is and has been maintained in all material respects in accordance with the past practice of the Limited Partnership and generally accepted industry practice, is in good working order (normal wear and tear excepted) and is suitable in all material respects for the purposes of its intended use. (b) All personal property leased by the Limited Partnership is in all material respects in the condition required of such property by the terms of the lease applicable thereto during the term of the lease and upon the expiration thereof. (c) "Permitted Encumbrances" shall mean those Encumbrances (1) referred to in Schedule 2.9(c), (2) for Taxes not yet due or payable or being contested in good faith, (3) that 14 constitute easements, covenants, rights-of-way and other similar matters of record, (4) that constitute mechanics', carriers', workers' compensation or like liens incurred in the ordinary course of business consistent with past practice, (5) that constitute other imperfections of title or encumbrances that, individually or in the aggregate, do not materially impair, and could not reasonably be expected materially to impair, the continued use and operation of the assets to which they relate in the business of the Station as presently conducted or (6) incurred, or deposits made, in the ordinary course of business consistent with past practice in connection with workers' compensation, unemployment insurance and social security, retirement and other similar legislation relating to amounts not yet due or payable. (d) This Section 2.9 does not relate to the Owned Property or the Leased Property, such items being the subject of Section 2.8, or to Intellectual Property, such items being the subject of Section 2.15. SECTION 2.10. ASSETS AND LIABILITIES OF THE LIMITED PARTNERSHIP The assets and liabilities of the Limited Partnership, GTC and GCI, including those set forth on the Balance Sheet, consist only of assets and liabilities solely related to the Station and its business as currently conducted. Except as set forth on Schedule 2.10, and except for the transfers contemplated by Section 4.3(b), the assets to be held by the Limited Partnership, GCI and GTC as of the Effective Time will constitute the assets necessary to operate the Station and its business as currently conducted. SECTION 2.11. EMPLOYEES None of GTC, GCI or the Limited Partnership has any employees other than the employees listed on Schedule 2.11. Schedule 2.11 contains, as of February 28, 1999: (i) a list of all Station Employees as defined below, and (ii) the rate of compensation of such Station Employees excluding commissions. Except as described in Schedule 2.16, the Limited Partnership has no written contracts of employment with any Station Employee. Except as set forth in Schedule 2.11, no Station Employee (i) shall be entitled to receive any termination, severance or deferred compensation payment or benefits as a result of the transactions contemplated by this Agreement, (ii) has any entitlement on or following the Effective Time under any individual agreement, or under any plan, program, policy or other arrangement, to (x) severance pay or benefits, or (y) bonus or incentive pay other than commission-based incentive pay, or (iii) is entitled to any such payment in the event any such Station Employee ceases to be employed at the Station after the Closing Date other than as a result of actual termination of such employment by the Station. "Station Employees" shall mean all individuals employed by GTC, GCI, the Limited Partnership or the Station. SECTION 2.12. EMPLOYMENT AND SIMILAR AGREEMENTS Except as disclosed in Schedule 2.16, there exist no consulting, employment, severance or termination agreements currently in effect between the Limited Partnership, GTC or GCI, and any current Station Employee or former employee, officer or director of the Limited Partnership, GTC or GCI. SECTION 2.13. ERISA (a) Each "employee welfare benefit plan" and "pension benefit plan" as defined in Section 3 of the Employment Retirement and Income Security Act of 1974, as amended, currently available to Station Employees is listed on Schedule 2.13, and, except as set forth on Schedule 15 2.13, copies of summary plan descriptions for each plan listed on Schedule 2.13 have been furnished to CBS. Such summary plan descriptions are accurate in all material respects. Each benefit plan currently available to Station Employees, including those listed on Schedule 2.13, is herein referred to as a "Benefit Plan". (b) There are no material undisclosed liabilities in respect of the Benefit Plans with respect to which GTC, GCI or the Limited Partnership could be liable. SECTION 2.14. LABOR MATTERS Except as disclosed on Schedule 2.14, as of the date hereof, none of the Limited Partnership, GCI or GTC is the subject of any suit, action or proceeding which is pending or, to the best of Gaylord's knowledge, threatened, asserting that GCI, GTC or the Limited Partnership has committed an unfair labor practice (within the meaning of the National Labor Relations Act or applicable state statutes) or seeking to compel GCI, GTC or the Limited Partnership to bargain with any labor organization as to wages and conditions of employment. No strike or other labor dispute involving GCI, GTC or the Limited Partnership is pending or, to the knowledge of Gaylord, GCI, GTC or the Limited Partnership, threatened, and, to the best of Gaylord's knowledge, there is no activity involving any employees of the Limited Partnership seeking to certify a collective bargaining unit or engaging in any other organizational activity. None of GCI, GTC or the Limited Partnership is a party to, or bound by, any collective bargaining agreement or other Contract with a labor union or labor organization. GTC, GCI and the Limited Partnership have complied in all material respects with all laws relating to wages, hours, collective bargaining and the payment of social security and similar Taxes, and no person has, to the best of Gaylord's knowledge, asserted that GCI, GTC or the Limited Partnership is liable in any material amount for any arrears of wages or any Taxes or penalties for failure to comply with any of the foregoing. SECTION 2.15. INTELLECTUAL PROPERTY As used herein, "Intellectual Property" means domestic and foreign patents, patent applications, trademark and service mark applications, registered trademarks, registered service marks, registered copyrights, and unregistered material trademarks, service marks and trade names. Schedule 2.15 sets forth a list of all Intellectual Property which GTC, GCI or the Limited Partnership owns, licenses or otherwise uses as of the date hereof. (a) Except as set forth in Schedule 2.15, (i) all Intellectual Property owned by the Limited Partnership has been duly registered in, filed in or issued by the appropriate Governmental Entity where such registration, filing or issuance is in the reasonable business judgment of the Limited Partnership necessary for the business of the Station as currently conducted or (ii) the Limited Partnership owns, licenses or otherwise has the right to use all Intellectual Property and material trade secrets, inventions, know-how, formulae, processes, procedures and computer software ("Technology") used in connection with the Station as its business is currently conducted. To the best of Gaylord's knowledge, no Technology currently used in connection with the Station has been used, divulged or appropriated for the benefit of any person other than the Limited Partnership. (b) To the best of Gaylord's knowledge no other person has violated, infringed upon, misused, misappropriated any Intellectual Property or Technology of the Limited Partnership. Except as set forth in Schedule 2.15, none of GTC, GCI or the Limited Partnership has made any pending claim in writing of a violation, infringement, misuse or misappropriation by others of rights of GTC, GCI or the Limited Partnership to or in connection with any Intellectual Property 16 or Technology currently used in connection with the Station and its business as currently conducted. To the best of Gaylord's knowledge, there are no interferences or other contested inter partes proceedings, either pending or threatened, in any copyright office or patent and trademark office or by any other Governmental Entity relating to any pending application for any Intellectual Property currently used in connection with the Station as its business is currently conducted. (c) To the best of Gaylord's knowledge, the Limited Partnership has not violated, infringed upon, misused, misappropriated or otherwise come into conflict with any Intellectual Property of any other person. The Limited Partnership has not received any written charge, complaint, claim, demand or notice alleging any violation, infringement, misuse, misappropriation or other conflict of the type listed in the prior sentence (including any written claim that the Limited Partnership must license or refrain from using any Intellectual Property or other proprietary information of any other person) which has not been settled or otherwise fully resolved, nor is there any action, pending or, to the best of Gaylord's knowledge, threatened against the Limited Partnership claiming that the Limited Partnership has, whether directly, contributorily or by inducement, interfered with, infringed, or misappropriated or come into conflict with any other Intellectual Property. SECTION 2.16. CONTRACTS (a) Schedule 2.16 provides a true and complete listing of all contracts as of the date hereof to which GCI, GTC or the Limited Partnership is a party or by which GCI, GTC or the Limited Partnership is bound, or with respect to the Station, GCI, GTC or the Limited Partnership to which Gaylord or any of its subsidiaries (other than GCI or GTC) is a party, involving: (i) the purchase, sale or lease of real property; (ii) the purchase, rental or use of any films, recordings, television programming or programming services which is not terminable by the Limited Partnership without penalty on thirty (30) days' notice or less or which provides for performance over a period of more than ninety (90) days or which involves the payment after the date hereof of more than $25,000; (iii) the purchase of merchandise, supplies or other tangible personal property or the receipt of services which is not terminable by the Limited Partnership without penalty on thirty (30) days' notice or less or which provides for performance over a period of more than ninety (90) days or which involves the payment after the date hereof of more than $25,000; (iv) the lease, sublease or similar agreement with any person under which any of GCI, GTC or the Limited Partnership is a lessor or sublessor of, or makes available for use to any person, (A) any real property of the Limited Partnership or (B) any portion of the premises otherwise occupied by the Limited Partnership; (v) the lease, sublease or similar agreement with any person under which (A) the Limited Partnership is a lessee of, or holds or uses, any machinery, equipment, vehicle or other tangible personal property owned by any person or (B) the Limited Partnership is a lessor or sublessor of, or makes available for use by any person, any tangible personal property owned or leased by the Limited Partnership, in any such case which provide for performance over a period of more than ninety (90) days, which involve the payment or receipt after the date hereof of more than $25,000 or which require the payment of any penalties upon assignment or termination. 17 (vi) any contract under which GTC, GCI or the Limited Partnership has borrowed any money from, or issued any note, bond, debenture or other evidence of indebtedness to, any person (other than the Limited Partnership) or any other note, bond, debenture or other evidence of indebtedness issued to any person; (vii) any contract under which GTC, GCI or the Limited Partnership has, directly or indirectly, made any loan, advance, extension of credit or capital contribution to, or investment in, any person (other than among one another and other than to officers and employees of the Limited Partnership for travel, business or relocation expenses in the ordinary course of business); (viii) any mortgage, pledge, security agreement, deed of trust or other instrument granting an Encumbrance upon any property of GTC, GCI or the Limited Partnership; (ix) any contract under which GTC, GCI or the Limited Partnership is or may become obligated to indemnify (except where such obligation to indemnify is incidental to the purpose and the other provisions of such contract) any other person or otherwise to assume any material liability with respect to liabilities relating to any current or former business of the Limited Partnership or any predecessor person; (x) the sale of broadcast time for advertising or other purposes for cash which was not made in the ordinary course of business consistent with past practice; (xi) any guarantee of the obligations of any person by GTC, GCI or the Limited Partnership; (xii) any transaction other than in the ordinary course of business which is not terminable by the Limited Partnership without penalty on thirty (30) days' notice or less or which provides for payments over a period of more than ninety (90) days or which involves, together with any other such transactions, the payment after the date hereof of more than $25,000; (xiii) any agreement relating to a joint venture or similar arrangement with another person or entity with respect to all or any part of the operations of the Station or any of its assets; (xiv) any sales agency, advertising representative or advertising or public relations contract which is not terminable by the Limited Partnership without penalty on thirty (30) days' notice or less or which provides for payments over a period of more than ninety (90) days or which involves the payment after the date hereof of more than $25,000; (xv) any barter agreement or other agreement with advertisers for broadcasting or commercial time on the Station in exchange for goods or services; (xvi) any employee collective bargaining agreement, employment agreement (other than employment agreements terminable by the Limited Partnership without penalty on notice of thirty (30) days or less under which the only obligation of the Limited Partnership is to make current wage or salary payments and provide current fringe benefits), consulting advisory or service agreement, deferred compensation agreement or covenant not to compete; 18 (xvii) any agreement with employees (other than employment agreements disclosed in response to clause (xvi) above or excluded therefrom), agents or attorneys-in-fact of the Limited Partnership; (xviii) any contract (other than this Agreement) with (A) Gaylord or any of its Affiliates or (B) any officer, director or employee of Gaylord, GCI, GTC, the Limited Partnership or any other Affiliate of Gaylord (other than employment agreements covered by clause (xvi) above); or (xix) any other agreement, commitment, understanding or instrument which Gaylord, GCI, GTC or the Limited Partnership reasonably believes is material to the Station. (b) Schedule 2.16 also contains a copy of the Station's syndicated program and feature film "Inventory Report" as of February 28, 1999. Such report has been prepared in the normal course of the Station's business in a manner consistent with prior reports, but it has not been audited by or on behalf of the Limited Partnership. The information contained in such report is, to the best of Gaylord's knowledge, accurate in all material respects. 19 SECTION 2.17. STATUS OF CONTRACTS Gaylord has delivered to CBS true, complete and current copies of all contracts listed on Schedule 2.16. To the best of Gaylord's knowledge, all of the contracts listed on Schedule 2.16 are in full force and effect, and are valid, binding and enforceable in accordance with their terms (subject in each case to bankruptcy, insolvency, reorganization or similar laws relating to or affecting the enforcement of creditors' rights generally). To the best of Gaylord's knowledge, there is not under any such contract any default by any party thereto or any event that, after notice or lapse of time, or both, could constitute a default. None of Gaylord, GCI, GTC or the Limited Partnership has received notice or been otherwise advised of the intention of any party to terminate any of the contracts listed on Schedule 2.16. To the extent GCI, GTC or the Limited Partnership leases space on any of its transmission towers pursuant to a contract listed on Schedule 2.16, such leases, individually or in the aggregate, do not and would not reasonably be expected materially to impair the continued use and operation by the Station of any such towers in the business of the Station as presently conducted. SECTION 2.18. LITIGATION Except as disclosed in Schedule 2.18, as of the date hereof, there is no suit, action, proceeding or investigation pending or, to the best of Gaylord's knowledge, threatened against Gaylord or any of its subsidiaries, including GTC and GCI, or the Limited Partnership that, individually or in the aggregate, would reasonably be expected to have a Gaylord Material Adverse Effect, nor is there any judgment, order, decree, statute, law, ordinance, rule or regulation of any Governmental Entity or arbitrator outstanding against Gaylord, the Limited Partnership, GTC or GCI having, or which would reasonably be expected to have, a Gaylord Material Adverse Effect. SECTION 2.19. COMPLIANCE WITH APPLICABLE LAWS Except as disclosed in Schedule 2.19, there has occurred no default under any FCC Authorization or other material Permit possessed by GCI, GTC or the Limited Partnership, except for defaults that, individually or in the aggregate, would not reasonably be expected to have a Gaylord Material Adverse Effect. Except as disclosed in Schedule 2.19, GTC, GCI and the Limited Partnership are in compliance with all judgments, orders, decrees, statutes, laws, ordinances, rules and regulations of any Governmental Entity applicable to them, except for possible noncompliance which individually or in the aggregate would not reasonably be expected to have a Gaylord Material Adverse Effect. Nothing in this Section 2.19 shall relate to compliance with or Permits under environmental, health and safety laws which is the subject of Section 2.20. SECTION 2.20. ENVIRONMENTAL MATTERS Except as set forth in Schedule 2.20, to the best of Gaylord's knowledge: (a) GTC, GCI and the Limited Partnership are in compliance with all environmental, health and safety Requirements of Law applicable to them; (b) neither the Limited Partnership nor any of its current or former properties, assets or operation, is subject to any order from or agreement with any Governmental Entity or private party respecting (i) any environmental, health or safety Requirements of Law, (ii) any Remedial Action or (iii) any Liabilities and Costs arising from the Release or threatened Release of a Contaminant into the environment; 20 (c) there is not now, nor has there ever been: (i) any Release of any Contaminant on, in, under or from any assets or properties currently or formerly owned, leased or operated by GTC, GCI or the Limited Partnership; (ii) any underground storage tanks, aboveground storage tanks or surface impoundments on or under any properties owned or operated by GTC, GCI or the Limited Partnership; (iii) any asbestos containing material in any assets currently owned, leased or operated by GTC, GCI or the Limited Partnership; or (iv) any polychlorinated biphenyls (PCBs) in any assets owned or operated by GTC, GCI or the Limited Partnership; (d) none of Gaylord, GTC, GCI nor the Limited Partnership has received any notice or claim to the effect that it is or may be liable to any Governmental Entity or person as a result of the Release or threatened Release of a Contaminant into the environment; (e) none of GTC, GCI nor the Limited Partnership is the subject of any investigation by any Governmental Entity evaluating whether any Remedial Action is needed to respond to a Release or threatened Release of a Contaminant into the environment nor, is any such investigation threatened; and (f) no facility to which any Contaminant arising from any of the current or former properties, assets or operations of GTC, GCI or the Limited Partnership has been taken for disposal is currently subject to Remedial Action under any environmental, health or safety Requirement of Law. SECTION 2.21. FCC MATTERS Except as set forth on Schedule 2.21, all material notices, reports, forms, applications and other statements or disclosures required to be filed with the FCC with respect to the Station have been filed and complied with in all material respects and are complete, correct and current in all material respects. The Limited Partnership has timely paid, or caused to be paid, to the FCC all annual regulatory fees payable with respect to the FCC Authorizations. SECTION 2.22. NO FINDER None of Gaylord, GTC, GCI or the Limited Partnership, nor any party acting on behalf of any of them has paid or become obligated to pay any fee or commission to any broker, finder or intermediary for or on account of the transactions contemplated by any of the Transaction Agreements. SECTION 2.23. INSURANCE A copy of the Gaylord insurance manual has been made available to CBS, it being understood that CBS shall be solely responsible for arranging insurance coverage with respect to GTC, GCI and the Limited Partnership from and after the Closing. 21 SECTION 2.24. YEAR 2000 Gaylord believes that it is using all reasonable efforts to assure that all computer software used by the Station in its business as currently conducted and other applicable technology used by the Station in its business as currently conducted will be able to operate consistently after December 31, 1999 to accurately process, provide and receive date data (including calculating, comparing and sequencing) from, into and between the Twentieth and Twenty-first centuries, including the years 1999 and 2000, and make leap-year calculations. Gaylord, GTC, GCI and the Limited Partnership believe that they are using all reasonable efforts to assure that the Year 2000 date change will not adversely affect the systems and facilities that support the operation of the Station and its business as currently conducted, except as could not reasonably be expected to have a Material Adverse Effect on the Limited Partnership or the Station and its business as currently conducted. SECTION 2.25. TRANSACTIONS WITH AFFILIATES None of the contracts set forth in Schedule 2.16 between Gaylord or any of its Affiliates (excluding GTC and GCI), on the one hand, and GTC, GCI, the Limited Partnership or any of their respective Affiliates, on the other hand, will continue in effect subsequent to the Closing. SECTION 2.26. CABLE MATTERS (a) To the best of Gaylord's knowledge, Schedule 2.26 sets forth as of the date hereof a list of all Market Cable Systems which carry the Station's signal and/or to which the Station has provided a must-carry notice or retransmission consent notice in accordance with the provisions of the Cable Television Consumer Protection and Competition Act of 1992, as amended, and the FCC Regulations (collectively, the "Cable Act Requirements"), other than those which have fewer than 2,000 subscribers. (b) Except as set forth on Schedule 2.26, there are no: (i) written must-carry or retransmission consent notices referred to in clause (a) above which were not delivered to the Market Cable System in question on or before the date required under the Cable Act Requirements for such notices to be effective for the three-year period ending in 1999; (ii) Market Cable Systems which are carrying the Station's signal and which have given written notice of such Market Cable System's intention to delete the Station from carriage or to change the Station's channel position on such cable system, other than pursuant to any agreement described in clause (c) above; (iii) written notices received by Gaylord from any Market Cable System alleging that the Station does not deliver an adequate signal level, as defined in 47 C.F.R. ss.76.55(c)(3), to such Market Cable System's principal headend (other than any such notice as to which such failure has been remedied or been determined not to exist); (iv) pending petitions filed by Gaylord for special relief to include any additional community or area as part of the Station's television market, as defined in 47 C.F.R. ss. 76.55(e); and 22 (v) pending petitions served on Gaylord for special relief requesting the deletion of any community or area from the Station's television market. SECTION 2.27. DIGITAL TELEVISION The Station has been assigned a channel (Channel 19) by the FCC for the provision of digital television ("DTV") service. The FCC Authorizations listed in Schedule 2.7 include a construction permit and all other authorizations necessary to permit the construction of a DTV station on such channel (the "DTV Facility"). Construction of the DTV Facility will be completed, and operation of the DTV Facility commenced, on or before May 1, 1999, the deadline set forth in 47 C.F.R. ss.73.624(d). To the best of Gaylord's knowledge, there is no fact or circumstance that will delay the conversion of the Station to DTV operation in accordance with the May 1, 1999 deadline and the FCC's overall prescribed timetable for such conversion, or that may cause the conversion of the Station to DTV operation to have a Gaylord Material Adverse Effect. SECTION 3. REPRESENTATIONS AND WARRANTIES OF CBS CBS makes the following representations and warranties to Gaylord as of the date hereof and, subject to the following sentence, as of the Closing Date. The representations and warranties of CBS in this Agreement that are qualified as to materiality shall be true and correct, and those not so qualified shall be true and correct in all material respects, as of the Closing Date as though made on the Closing Date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties qualified as to materiality shall be true and correct, and those not so qualified shall be true and correct in all material respects, on and as of such earlier date). SECTION 3.1. ORGANIZATION; QUALIFICATION; POWER Each of CBS and the CBS Subsidiaries is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Each of CBS and the CBS Subsidiaries is duly qualified to do business as a foreign entity and in good standing under the laws of each state or other jurisdiction in which either the ownership or use of the properties owned or used by it, or the nature of the activities conducted by it, requires such qualification, except where the failure to be so qualified could not reasonably be expected to have a Material Adverse Effect on CBS and its subsidiaries, taken as a whole, or impair the ability of CBS and the CBS Subsidiaries to consummate the transactions contemplated by, or to satisfy their obligations under, the Transaction Agreements, or delay in any material respect or prevent the consummation of any of the transactions contemplated by the Transaction Agreements. Each of CBS and the CBS Subsidiaries has the requisite corporate power and authority to carry on its business as now conducted. CBS has delivered to Gaylord true and complete copies of the certificates of incorporation and by-laws of CBS and the CBS Subsidiaries, in each case as amended through the date of this Agreement. SECTION 3.2. CBS COMMON STOCK TO BE ISSUED IN THIS TRANSACTION The issuance of the CBS Common Stock to Gaylord pursuant to this Agreement has been duly authorized by all necessary corporate action on the part of CBS. When issued and delivered to Gaylord pursuant to this Agreement, the CBS Common Stock issued pursuant to this Agreement shall be duly authorized, validly issued, fully paid, non-assessable and not subject to preemptive rights. 23 SECTION 3.3. AUTHORITY; ABSENCE OF CONFLICTING AGREEMENTS (a) Each of CBS and the CBS Subsidiaries has the requisite corporate power and authority to execute, deliver and perform each Transaction Agreement to which it is, or is specified to be, a party and to consummate the transactions contemplated thereby and to comply with the terms, conditions and provisions thereof. (b) The execution, delivery and performance by CBS and the CBS Subsidiaries of each Transaction Agreement to which it is or will be a party and the consummation by CBS and the CBS Subsidiaries of the transactions contemplated thereby have been duly authorized and approved by all necessary corporate action on the part of CBS and the CBS Subsidiaries. Each of CBS and the CBS Subsidiaries has duly executed and delivered this Agreement and, prior to the Closing, will have duly executed and delivered the other Transaction Agreements to which it is, or is specified to be, a party, and this Agreement constitutes, and each of the Transaction Agreements to which it is, or is specified to be, a party will upon execution and delivery thereof constitute, its legal, valid and binding obligation, enforceable against it in accordance with its respective terms, except in each case as such enforceability may be limited by bankruptcy, moratorium, insolvency, reorganization or other similar laws affecting or limiting the enforcement of creditors' rights generally and except as such enforceability is subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). (c) Neither the execution and delivery by CBS and the CBS Subsidiaries of any of the Transaction Agreements to which any of them is, or is specified to be, a party, the consummation by CBS and the CBS Subsidiaries of the transactions contemplated thereby nor compliance by CBS and the CBS Subsidiaries with or fulfillment by any of them of the terms, conditions and provisions thereof will conflict with, or result in a violation or breach of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, amendment, cancellation or acceleration of any obligation or loss of a material benefit under, or to increased, additional, accelerated or guaranteed rights or entitlements of any person under, or result in the creation of any Encumbrance upon any of the properties or assets of CBS or the CBS Subsidiaries under, (i) the certificates of incorporation or by-laws of CBS or the CBS Subsidiaries, (ii) subject to the governmental filings and other matters referred to in Section 3.3(d), any of the terms, conditions or provisions of any note, bond, mortgage, indenture, lease, contract, agreement, obligation, understanding, commitment or other legally binding arrangement or of any Permit applicable to CBS or any subsidiary of CBS or their respective properties or assets or (iii) subject to the governmental filings and other matters referred to in Section 3.3(d), any judgment, order, decree, statute, law, ordinance, rule or regulation applicable to CBS or any subsidiary of CBS or their respective properties or assets, other than, in the case of clause (ii) or (iii), any such items that, individually or in the aggregate, would not have a Material Adverse Effect on CBS and its subsidiaries taken as a whole, or impair the ability of CBS and the CBS Subsidiaries to consummate the transactions contemplated by, or to satisfy their obligations under, the Transaction Agreements, or delay in any material respect or prevent the consummation of any of the transactions contemplated by the Transaction Agreements (a "CBS Material Adverse Effect"). Except for (i) consents, approvals, licenses, permits, orders, authorizations, registrations, declarations, filings or applications as may be required under, and other applicable requirements of, the Exchange Act, the Securities Act, the Improvements Act and any foreign competition laws, (ii) filings under state securities or "blue sky" laws, (iii) filings with the NYSE, (iv) approvals of and filings with the FCC under the Communications Act, (v) the filing of the GCI Articles of Merger with the Secretary of State of the State of Texas, the filing of the GCI Certificate of Merger 24 and the GTC Certificate of Merger with the Secretary of State of the State of Delaware and the filing of appropriate documents with the relevant authorities of other jurisdictions in which the CBS Subsidiaries are qualified to do business and (vi) other consents, approvals, orders, authorizations, registrations, declarations, filings and applications expressly provided for in the Transaction Agreements, no consent, approval, license, permit, order or authorization of, or registration, declaration or filing with, any Governmental Entity is required by or with respect to CBS or any subsidiary of CBS in connection with the execution, delivery or performance by CBS and the CBS Subsidiaries of each Transaction Agreement to which any of them is, or is specified to be, a party or the consummation by CBS and the CBS Subsidiaries of the transactions contemplated thereby (except where the failure to obtain such consents, approvals, licenses, permits, orders or authorizations, or to make such registrations, declarations or filings, would not, individually or in the aggregate, have a CBS Material Adverse Effect). SECTION 3.4. SEC DOCUMENTS; UNDISCLOSED LIABILITIES CBS has filed all reports, schedules, forms, statements and other documents required to be filed by it with the SEC since January 1, 1998 (the "CBS SEC Documents"). As of their respective dates, the CBS SEC Documents complied in all material respects with the requirements of the Securities Act or the Exchange Act, as the case may be, and the rules and regulations of the SEC promulgated thereunder applicable to such CBS SEC Documents, and none of the CBS SEC Documents when filed contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. Except to the extent that information contained in any CBS SEC Document has been revised or superseded by a later filed CBS SEC Document, none of the CBS SEC Documents contains any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The financial statements of CBS included in the CBS SEC Documents comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto, have been prepared in accordance with GAAP (except, in the case of unaudited statements, as permitted by Form 10-Q of the SEC) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present in all material respects the consolidated financial position of CBS and its consolidated subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal year-end audit adjustments). Except as set forth in the Filed CBS SEC Documents, and except for liabilities and obligations incurred in the ordinary course of business consistent with past practice since the date of the most recent consolidated balance sheet included in the Filed CBS SEC Documents, neither CBS nor any of its subsidiaries has or will have any material liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) required by GAAP to be recognized or disclosed on a consolidated balance sheet of CBS and its consolidated subsidiaries or in the notes thereto. SECTION 3.5. NO FINDER Neither CBS, the CBS Subsidiaries nor any party acting on its or their behalf has paid or become obligated to pay any fee or commission to any broker, finder or intermediary for or on account of the transactions contemplated by any of the Transaction Agreements. 25 SECTION 3.6. STATUS OF CBS AND THE CBS SUBSIDIARIES Subject to the grant of the Waiver, CBS and the CBS Subsidiaries are legally and financially qualified under existing law, including the Communications Act, to (i) purchase, own, operate and control the Station and (ii) own, by means of acquisition of the GTC Stock and the GCI Stock, the general and limited partnership interests of the Limited Partnership. Neither CBS nor any of the CBS Subsidiaries has knowingly taken any action which would reasonably be expected to cause the FCC or any other Governmental Entity to institute proceedings against CBS or any of the CBS Subsidiaries with respect to their respective legal qualifications to acquire the GTC Stock and the GCI Stock or knowingly taken any other action which would reasonably be expected to result in CBS or the CBS Subsidiaries being in noncompliance in any material respect with the ownership requirements of the Communications Act (or of any other Governmental Entity having jurisdiction) which would impair CBS's or the CBS Subsidiaries' qualification to be the transferee of the FCC Authorizations. SECTION 3.7. ABSENCE OF CERTAIN CHANGES OR EVENTS Except as set forth in Schedule 3.7 or as disclosed in the CBS SEC Documents filed and publicly available prior to the date of this Agreement (as amended to the date of this Agreement, the "Filed CBS SEC Documents") or as otherwise expressly contemplated by the Transaction Agreements, since the date of the most recent audited financial statements included in the Filed CBS SEC Documents, there has not been any event, change or development which individually or in the aggregate has had or would reasonably be expected to have a Material Adverse Effect on CBS and its subsidiaries taken as a whole or the ability of CBS and the CBS Subsidiaries to consummate the transactions contemplated by, or to satisfy their obligations under, the Transaction Agreements. SECTION 3.8. LITIGATION Except as disclosed in the Filed CBS SEC Documents, as of the date hereof, there is no suit, action, proceeding or investigation pending or, to the best knowledge of CBS, threatened against CBS or any of its subsidiaries that, individually or in the aggregate, would reasonably be expected to have a CBS Material Adverse Effect, nor is there, subject to the grant of the Waiver, any judgment, order, decree, statute, law, ordinance, rule or regulation of any Governmental Entity or arbitrator outstanding against CBS or any of its subsidiaries having, or which would reasonably be expected to have, a CBS Material Adverse Effect. SECTION 3.9. COMPLIANCE WITH APPLICABLE LAWS CBS and its subsidiaries have in effect all material Permits reasonably necessary for them to own, lease or operate their properties and assets and to carry on their businesses as now conducted, and there has occurred no default under any such material Permit, except for the lack of permits and defaults that, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect on CBS and its subsidiaries taken as a whole. Except as disclosed in the Filed CBS SEC Documents, CBS and its subsidiaries are in compliance with all judgments, orders, decrees, statutes, laws, ordinances, rules and regulations of any Governmental Entity applicable to them, except for possible noncompliance which individually or in the aggregate would not reasonably be expected to have a CBS Material Adverse Effect. SECTION 3.10. INTERIM OPERATIONS OF THE CBS SUBSIDIARIES The CBS Subsidiaries are and will be at the Effective Time, wholly owned subsidiaries of CBS. The CBS Subsidiaries were formed solely for the purpose of engaging in the transactions 26 contemplated hereby and have and will at the Effective Time have engaged in no other business other than incident to their respective creation and this Agreement and the transactions contemplated hereby. SECTION 3.11. TAXES (a) All federal, state and local, domestic and foreign, material Tax Returns required to be filed by or on behalf of any of CBS or any of its subsidiaries, or any consolidated, combined, affiliated or unitary group of which any of CBS or any of its subsidiaries is or has ever been a member, have been timely filed or requests for extensions have been timely filed and any such extensions have been granted and have not expired; (b) each such Tax Return was complete and correct in all material respects; and (c) all material Taxes with respect to taxable periods covered by such Tax Returns and all other material Taxes for which any of CBS or any of its subsidiaries are liable have been paid in full, or reserves therefor have been established in accordance with GAAP on the balance sheet contained in the Filed CBS SEC Documents. SECTION 4. ACTIONS PRIOR TO THE CLOSING DATE The respective parties hereto covenant and agree to take the following actions between the date hereof and the Closing Date: SECTION 4.1. PRESERVE ACCURACY OF REPRESENTATIONS AND WARRANTIES Each of the parties hereto shall refrain from taking any action which would render any representation or warranty in this Agreement that is qualified as to materiality inaccurate as of, and as if made on, the Closing Date, or which would render any representation or warranty that is not so qualified inaccurate in any material respect as of, and as if made on, the Closing Date. Each party shall promptly notify the other of any action, suit or proceeding that shall be instituted or threatened against such party to restrain, prohibit or otherwise challenge the legality of any transaction contemplated by this Agreement. Gaylord, GCI and GTC shall promptly notify CBS of any lawsuit, claim, proceeding or investigation that is threatened, brought, asserted or commenced against Gaylord, GCI, GTC or the Limited Partnership which would have been required to be listed in Schedule 2.18 if such lawsuit, claim, proceeding or investigation had arisen prior to the date hereof. SECTION 4.2. FCC CONSENT; IMPROVEMENTS ACT APPROVAL (a) As promptly as practicable after the date hereof but in any event no later than twenty (20) days hereafter, the parties hereto shall file with the FCC applications requesting its consent to the transfer of control of the Station pursuant to the Mergers. Simultaneously with the filing of the applications, CBS will file with the FCC a request for the Waiver. The parties hereto will cooperate in the preparation of such applications and the request for the Waiver (including the furnishing to each other of copies of such applications and request prior to filing) and will diligently take, or cooperate in the taking of, all necessary, desirable and proper steps, provide any additional information reasonably required and otherwise use their reasonable efforts to prosecute the applications and the request for the Waiver and to obtain promptly the requested consent and approval of the FCC to the transfer of control of the Station and the Waiver. Any fees assessed by the FCC incident to the filing or grant of such applications shall be borne by 27 CBS. The parties hereto shall make available to one another, promptly after the filing thereof, copies of all reports filed on or prior to the Closing Date with the FCC by any of the parties hereto, as the case may be, in respect of the Station. Neither CBS nor the CBS Subsidiaries will act or fail to act in such a way as would adversely affect their legal qualifications to consummate the Mergers and the other transactions contemplated hereby pursuant to the Communications Act. (b) As promptly as practicable after the date hereof but in any event no later than twenty (20) days hereafter, the parties hereto shall file with the Federal Trade Commission (the "FTC") and the Antitrust Division of the Department of Justice ("DOJ") the notifications and other information required to be filed by such commission or department under the Improvements Act, or any rules and regulations promulgated thereunder, with respect to the transactions contemplated hereby. Each of the parties hereto covenants to file as promptly as practicable such additional information as may be requested to be filed by such commission or department. Each of the parties hereto warrants that all such filings by it will be, as of the date filed, true and accurate in all material respects and in accordance with the requirements of the Improvements Act and any such rules and regulations. Gaylord and CBS shall each pay one-half of the filing fees payable under the Improvements Act in connection with the notifications and information described in this Section 4.2(b). (c) Notwithstanding any other provision of this Agreement, in the event the approval of the FCC under Section 4.2(a) is conditioned upon (i) the outcome of the FCC's pending rule-making proceeding with respect to the FCC's television ownership rules (MM Docket Nos. 91- 221 and 87-8) or (ii) the divestiture by CBS of any (A) broadcast stations in the Dallas/Forth Worth area or (B) television stations necessary in order to comply with the FCC's national multiple ownership rule, 47 CFR Section 73.3555(e), CBS agrees promptly and at its sole expense to take any and all actions necessary to accept and to comply with such conditions in order to consummate the Mergers in accordance with this Agreement without undue delay or prejudice to Gaylord. SECTION 4.3. OPERATIONS PRIOR TO THE CLOSING DATE (a) Except as permitted by this Agreement, including the provisions of Section 4.3(b), or as approved by CBS as provided below, the Limited Partnership shall operate and carry on the business of the Station, and the business of GTC, GCI and the Limited Partnership shall be operated and carried on, only in the ordinary course consistent with past practice and in compliance in all material respects with all applicable laws, rules and regulations. Consistent with the foregoing and subject to Section 4.3(b), the Limited Partnership shall: (i) retain ownership of and maintain its assets in good operating condition and repair consistent with past practices and the intended use of such assets (wear and tear in ordinary usage excepted), (ii) use its reasonable efforts to retain the Station's libraries of films and other programming, to maintain the business organization of the Station intact, to keep available the services of the current officers and other key employees and to preserve the goodwill of the suppliers, contractors, licensors, employees, customers, distributors and others having business relations with the Station, (iii) maintain the budgeted level of expenditures for marketing and promotions, and (iv) continue any remediation efforts relating to compliance with Year 2000 issues as described in Section 2.24. The Limited Partnership shall complete construction and commence operation of the DTV Facility on or before May 1, 1999, and shall take all other steps, including the timely submission of all required notices, reports, forms, applications and other statements or disclosures, that are necessary to satisfy the FCC's requirements with respect to the implementation of DTV service. Without limiting the foregoing, and except as permitted by this Agreement, including the provisions of Section 4.3(b), or except with the express prior written approval of CBS, none of Gaylord and its subsidiaries, including GTC and GCI, and the Limited Partnership shall: 28 (i) amend any of the Organizational Documents; (ii) make any material change in the operations of the Station; (iii) sell, lease, transfer or otherwise dispose of any of the assets of GCI, GTC or the Limited Partnership, other than (A) tangible personal property having a value, in the aggregate, of less than $50,000 sold or otherwise disposed of in the ordinary course of business consistent with past practice and (B) tangible personal property replaced in the ordinary course of business consistent with past practice with items of substantially the same nature and of equal or greater quality; (iv) enter into any lease of real property with respect to the Station, except any renewals of existing leases in the ordinary course of business consistent with past practice and as to which CBS shall be permitted to participate in the negotiation of the terms; (v) permit any of the assets of GTC, GCI or the Limited Partnership to become subject to any Encumbrance, other than Permitted Encumbrances; (vi) create, incur, guarantee or assume any indebtedness for borrowed money or enter into any capitalized leases, but, with respect to Gaylord, only to the extent any such indebtedness or lease relates to GTC, GCI, the Limited Partnership or the Station; (vii) make any change in the compensation of the employees of the Station, other than changes required to be made in accordance with existing agreements, the renewal of employment agreements in the ordinary course of business, and normal compensation practices, in each case consistent with past practice; (viii) make any change in the accounting policies applied in the preparation of the Financial Statements contained in Schedule 2.4; (ix) cancel any material indebtedness (other than Accounts Receivable) owed to, or waive any material claims held by, GCI, GTC or the Limited Partnership; (x) delay payment of any account payable or other liability of GCI, GTC or the Limited Partnership beyond its due date or the date when such liability would have been paid in the ordinary course of business consistent with past practice; (xi) institute any increase in any profit sharing, bonus, incentive, deferred compensation, insurance, pension, retirement, medical (except for a contemplated contract with a preferred provider organization), hospital, disability, welfare or other employee benefit plan with respect to employees of the Station other than (A) as required by law, (B) changes made in accordance with normal practices consistent with past practice that are not, in the aggregate, material in amount or effect, or changes which affect Gaylord's employees on a company-wide basis or (C) stay-on or reward bonuses or similar incentives paid by Gaylord in its discretion; (xii) cause or permit, by any act or failure to act, any of the FCC Authorizations or other material Permits of GCI, GTC or the Limited Partnership to expire, to be modified in any materially adverse respect, to be revoked, or to be suspended; or take, or fail to take, any action that would be reasonably likely to cause the FCC or any other Governmental Entity to institute proceedings for the suspension, revocation or materially adverse modification of any of the FCC Authorizations or other material Permits of GCI, GTC or the Limited Partnership; 29 (xiii) pay, loan or advance any amount to, or sell, transfer or lease any of the assets of GCI, GTC or the Limited Partnership to, or enter into any agreement or arrangement with, Gaylord, GCI, GTC, the Limited Partnership or any of their Affiliates other than intercompany transactions in the ordinary course of business consistent with past practice, none of which shall survive the Effective Time; (xiv) permit GCI, GTC or the Limited Partnership to acquire, in any manner, any business or any corporation, partnership, association or other business organization or division thereof or otherwise acquire any assets that are material; (xv) with respect to GCI, GTC and the Limited Partnership, make any material Tax election or settle or compromise any material Tax liability or refund; (xvi) with respect to the Station, waive any material right under the Cable Act Requirements, fail to timely provide to any Market Cable System a must-carry notice or retransmission consent notice in accordance with the Cable Act Requirements (including any such notice necessary for such notice to be effective for the three-year period beginning in 1999 and ending in 2002), or reach any agreement or understanding with any Market Cable System on the subject of retransmission consent or must-carry under the Cable Act Requirements without prior consultation with CBS; (xvii) take any action which would materially adversely affect CBS's ability to deliver the certificate contemplated by Section 7.6; or (xviii) authorize, or commit or agree to take, whether in writing or otherwise, any of the foregoing actions. Gaylord agrees that CBS shall have the right to approve any contract or other agreement to be entered into by GCI, GTC or the Limited Partnership involving payments of more than $500,000 during its term or in connection with its termination, or having a duration of more than one (1) year; provided, however, that such approval shall not be unreasonably withheld by CBS; and provided further that the Limited Partnership shall be permitted to enter into a contract substantially on the terms as set forth on Schedule 4.3(a) without the approval of CBS. (b) Notwithstanding anything to the contrary in this Agreement or any of the other Transaction Agreements, between the date hereof and the Effective Time, GTC, GCI and the Limited Partnership shall transfer to Gaylord or any Affiliate of Gaylord (other than GTC, GCI or the Limited Partnership), any of the following assets, for any consideration (so long as such consideration does not involve the assumption by GTC, GCI or the Limited Partnership of attendant liabilities), or for no consideration, but at the expense of Gaylord: (i) all of GTC's, GCI's and the Limited Partnership's cash and cash equiva lents (including any marketable securities or certificates of deposit), and all intercompany receivables and payables as of the Effective Time; (ii) all rights to refunds for prepaid expenses including prepayment for bonds, contracts or policies of insurance and prepaid insurance with respect to such contracts or policies as of the Effective Time; 30 (iii) all records prepared in connection with the sale of the Station (other than records prepared for CBS or its Affiliates in connection with this Agreement), including bids received from others and analyses relating to the Station and the Station's assets; (iv) except to the extent the parties shall otherwise specifically agree in writing, all rights, obligations and assets under the Benefit Plans; (v) all of the Limited Partnership's Accounts Receivable, including rights and claims to payments made by the Copyright Royalty Tribunal and related to the operations of the Station arising out of transactions occurring prior to the Closing Date; (vi) all of the Limited Partnership's, GTC's and GCI's right, title and interest in and to that certain unused parcel of real estate, and the abandoned structure thereon, in Fort Worth, Texas, which real estate and structure are not involved in the current operations of the Station and are more particularly described on Schedule 2.8, and all of the Limited Partnership's interest in any Affiliate (that owns no assets related to the Station) to whom it may transfer such parcel; (vii) all of Gaylord's and its Affiliates' Intellectual Property and Technology not used primarily in connection with the Station, including all computer software programs (whether or not used primarily in connection with the Station, and whether or not owned by Gaylord or its Affiliates) relating to the general ledger, accounts payable, payroll, and human resources of the Station; (viii) the programming contracts set forth on Schedule 4.3(b); and (ix) all of the Limited Partnership's, GTC's and GCI's rights and obligations under that certain Advertising Agreement dated as of December 4, 1998, by and among Marcus Cable Operating Company, LLC, Charter Communications, Inc., and the Limited Partnership. Gaylord hereby assumes all liabilities and obligations of any nature (whether accrued, absolute, unasserted, contingent or otherwise) relating to any of the foregoing. (c) Gaylord shall, within fifteen (15) days after the end of each month, provide CBS with copies of (i) the unaudited income statement of the Limited Partnership for such month and (ii) the unaudited balance sheet of the Limited Partnership as of the end of such month. SECTION 4.4. COLLECTION OF ACCOUNTS RECEIVABLE (a) At the Closing, Gaylord shall designate CBS, by means of a mutually acceptable agency agreement, as its agent solely for purposes of collecting on behalf of Gaylord the Accounts Receivable. Gaylord shall deliver to CBS, on or immediately after the Closing Date, a complete and detailed statement of the Accounts Receivable. CBS shall make reasonable efforts to collect the Accounts Receivable during the period (the "Collection Period") beginning at the Effective Time and ending on the last day of the fifth full calendar month following the Closing Date. Any payment received by CBS (i) at any time following the Effective Time, (ii) from a customer of the Station after the Effective Time who was also a customer of the Station prior to the Effective Time and (iii) which is not designated as a payment of a particular invoice or invoices or as a security deposit or other prepayment, shall be presumptively applied to the accounts receivable for such customer outstanding for the longest amount of time and, if such 31 accounts receivable shall be an Accounts Receivable, remitted to Gaylord in accordance with Section 4.4(b); provided, however, that if, prior to the Effective Time, the Limited Partnership or, after the Effective Time, the Limited Partnership or CBS received or receives a written notice of dispute from a customer with respect to an Accounts Receivable that has not been resolved, then CBS shall apply any payments from such customer to such customer's oldest, non-disputed accounts receivable. CBS shall not be obligated to refer any of the Accounts Receivable to a collection agency or to an attorney for collection. CBS shall incur no liability to Gaylord for any collected or uncollected Accounts Receivable. During the Collection Period, neither Gaylord nor its agents, without the consent of CBS, shall make any direct solicitation of any customers owing the Accounts Receivable for collection purposes. (b) On or before the fifth day following the end of each calendar month in the Collection Period, CBS shall deposit into an account identified by Gaylord at the time of Closing the amounts collected during the preceding month of the Collection Period with respect to the Accounts Receivable. CBS shall furnish Gaylord with a list of the amounts collected during such calendar month with respect to the Accounts Receivable and a schedule of the amount remaining outstanding under each particular account. Gaylord shall be entitled to inspect and/or audit the records maintained by CBS pursuant to this Section 4.4 from time to time, upon reasonable advance notice. (c) Following the expiration of the Collection Period, CBS shall have no further obligations under this Section 4.4, except that CBS shall immediately pay over to Gaylord any amounts subsequently paid to it with respect to any Accounts Receivable. Following the Collection Period, after consultation with CBS, Gaylord may pursue collections of all Accounts Receivable, and CBS shall deliver to Gaylord all files, records, notes and any other materials relating to the Accounts Receivable. SECTION 4.5. PUBLIC ANNOUNCEMENT None of the parties hereto shall, without the approval of the other, make any press release or other public announcement concerning the transactions contemplated by this Agreement, except as and to the extent that any such party shall be so obligated by law or by the rules, regulations or policies of any national securities exchange or association or Governmental Entity, in which case the other parties shall be advised and the parties shall use their best efforts to cause a mutually agreeable release or announcement to be issued; provided, however, that the parties hereby acknowledge and agree that communications among employees of the parties hereto and their attorneys, representatives and agents necessary to consummate the transactions contemplated hereby shall not be deemed a public announcement for purposes of this Section 4.5. Upon the execution and delivery of this Agreement, the parties hereto will cooperate in respect of the immediate issuance of a mutually acceptable press release relating to the transactions contemplated by this Agreement. SECTION 4.6. COMPLIANCE WITH LAWS From the date hereof until the Effective Time, none of the parties hereto shall take any action in respect of the operations, employees or business of the Station which violates, in any material respect, any law, regulation, rule, writ, injunction, ordinance, franchise, decree or order of any court or of any foreign, federal, state, municipal or other Governmental Entity applicable to the Station or the operations, assets, employees or business of the Station. 32 SECTION 4.7. ADVICE OF CHANGES From the date hereof until the Effective Time, CBS and Gaylord shall promptly advise the other party orally and in writing of (i) any representation or warranty made by it contained in this Agreement that is qualified as to materiality becoming untrue or inaccurate in any respect or any such representation or warranty that is not so qualified becoming untrue or inaccurate in any material respect, (ii) the failure by any party or one of its Affiliates to comply with or satisfy in any material respect any covenant, condition or agreement to be complied with or satisfied by it under this Agreement or (iii) any change or event (x) having, or which can reasonably be expected to have, in the case of CBS, a Material Adverse Effect on CBS and its subsidiaries taken as a whole and, in the case of Gaylord, a Gaylord Material Adverse Effect, (y) having, or which can reasonably be expected to have, the effect set forth in clause (i) above, or (z) which has resulted, or which can reasonably be expected to result, in any of the conditions set forth in Sections 6 or 7 not being satisfied; provided, however, that no such notification shall affect the representations, warranties, covenants or agreements of the parties or the conditions to the obligations of the parties under this Agreement. SECTION 4.8. NO SOLICITATION Gaylord shall not, nor shall Gaylord permit any Affiliate or any officer, director or employee of Gaylord or any Affiliate to (i) solicit, initiate or encourage any "other bid", (ii) enter into any agreement with respect to any other bid or (iii) participate in any negotiations regarding any other bid. As used in this Section 4.9, "other bid" shall mean any proposal for a merger, sale of securities, sale of substantial assets or similar transaction involving GCI, GTC or the Limited Partnership, other than the transactions contemplated by this Agreement. SECTION 4.9. OTHER CONSENTS Without limiting the provisions of Section 4.2, Gaylord, GTC, GCI, the Limited Partnership and CBS shall use all reasonable efforts to obtain or cause to be obtained prior to the Closing Date any necessary consents from any person (other than the FCC, DOJ or the FTC, which are covered in Section 4.2) to the assignment to CBS of any contract, license or other instrument and right of Gaylord, GTC, GCI and the Limited Partnership that requires the consent of any third party by reason of the transactions provided for in this Agreement, and CBS will reasonably cooperate with Gaylord, GTC, GCI and the Limited Partnership in this regard, but neither Gaylord, GTC, GCI, the Limited Partnership nor CBS will be obligated to make any special payment or grant any special concession to any party. For such purpose but without limitation, Gaylord, GTC, GCI and the Limited Partnership promptly will at and after the Closing execute and deliver to CBS such assignments, deeds, bills of sale, consents and other instruments as CBS or its counsel may reasonably request as necessary or desirable for such purpose. SECTION 4.10. NOTICE OF PROCEEDINGS The parties shall notify each other orally and in writing upon (i) becoming aware of any order or decree or any complaint praying for an order or decree restraining or enjoining the consummation of this Agreement or the transactions contemplated hereunder or (ii) receiving any notice from any Governmental Entity of its intention (x) to institute an investigation into, or institute a suit or proceeding to restrain or enjoin, the consummation of this Agreement or the transactions contemplated hereunder or (y) to nullify or render ineffective this Agreement or the transactions contemplated hereunder if consummated. 33 SECTION 4.11. TRADE AGREEMENTS There shall be no proration of current assets and liabilities with respect to trade and/or barter agreements under Section 1.13 or otherwise. Gaylord shall use its reasonable efforts to air the advertising contemplated under any trade and/or barter agreements to the fullest extent practicable prior to Closing. Gaylord shall not enter into any new trade and/or barter agreements prior to Closing without the consent of CBS, other than renewals of existing trade and/or barter agreements in the ordinary course of business. SECTION 4.12. CONFIDENTIALITY AGREEMENTS Gaylord hereby assigns, effective at the Closing, to CBS its rights under all confidentiality agreements entered into by Gaylord or any of its subsidiaries with any person in connection with the proposed sale of the Station to the extent such rights relate to GTC, GCI, the Limited Partnership or the Station. Copies of such agreements shall be provided to CBS on the Closing Date. SECTION 5. ADDITIONAL AGREEMENTS SECTION 5.1. SALES, USE AND TRANSFER TAXES, TITLE INSURANCE Any sales, use, documentary, stamp or other transfer Taxes payable by reason of the transactions contemplated by this Agreement shall be paid exclusively by CBS, except that all of the foregoing relating to the transfers referred to in Section 4.3(b) shall be paid by Gaylord. CBS and Gaylord shall cooperate in timely preparing and filing all Tax Returns with respect to such Taxes as may be required to comply with applicable laws. The costs of any commitments for title insurance and/or surveys obtained by CBS in connection with this transaction shall be paid solely by CBS. SECTION 5.2. EMPLOYEES; EMPLOYEE BENEFIT PLANS CBS, GTC and GCI agree to the following matters with regard to employees of GTC, GCI, the Limited Partnership, or the Station after the Effective Time: (a) CBS, GTC and GCI will continue the employment of all actively employed (including employees on short term disability leave of absence) Station Employees as of the Effective Time. Following the Effective Time, CBS shall maintain, or shall cause the Limited Partnership to maintain, on behalf of the Station Employees base compensation at the same level as in effect immediately prior to the Effective Time and employee benefit plans and arrangements that are, in the aggregate, comparable to the employee benefit plans and arrangements in effect from time to time after the Effective Time for similarly situated employees of CBS in its broadcasting businesses; provided, however, that no Station Employee shall be entitled to participate in CBS's and its Affiliates' tax-qualified or non-qualified defined benefit pension or excess plans, including any cash balance component thereof. Notwithstanding the foregoing, for not less than six months following the Effective Time, CBS shall provide, or cause the Limited Partnership to provide, severance pay and severance benefits to each Station Employee that are no less favorable than under the Benefit Plans or Gaylord's existing employment policies (except where otherwise provided in existing employment or personal services agreements). Notwithstanding the foregoing, except where existing employment or personal services agreements provide otherwise, CBS shall have the right to make changes or cause changes to be made in compensation, benefits and other terms of employment and to terminate the employment of any employee as CBS determines in its sole discretion. Nothing in this Agreement shall be construed as granting to any employee any rights of continuing employment. 34 (b) For purposes of providing health insurance coverage to Station Employees, CBS shall waive (or obtain a waiver of) all preexisting condition limitations for all such employees who are covered by the Station's existing health care plan as of the Effective Time (other than known preexisting conditions that were excluded by the Station's health care plan) and shall provide such health care coverage effective as of the Effective Time without the application of any eligibility period for coverage (unless a waiting period applied under the Station's plan). In addition, CBS shall credit all payments made by such employees and their dependents (pursuant to the Station's existing health care plan as of the Effective Time) toward deductible, co-payment, out-of-pocket and lifetime limits under CBS's health care and dental care plans for the plan year that includes the Effective Time. (c) As of the Effective Time, CBS, GTC and GCI will provide all Station Employees with credit for years of service at the Station or Gaylord or its Affiliates for eligibility and vesting purposes (but not for benefit accrual purposes or where it would result in a duplication of benefits) under CBS' applicable benefit plans, including severance arrangements (excluding, for this purpose, any Station Employee who is a key employee listed in Schedule 5.2(e) and any other Station Employee with an employment or personal services agreement which would provide otherwise in respect of severance payable thereunder), but only to the extent credited under the applicable Benefit Plan or other applicable Gaylord plan. Without limiting the foregoing, all Station Employees shall be entitled to full credit for years of service with respect to their right (if any) to receive stock options under CBS's Fund the Future Program. (d) CBS shall indemnify and hold harmless Gaylord and its Affiliates from and against any liabilities or obligations in connection with the Workers Adjustment and Retraining Notification Act (or any similar state or local law) in connection with this transaction, other than any liabilities or obligations relating to a violation by Gaylord of such act (or such similar state or local law) prior to the Effective Time. (e) The parties agree to those provisions set forth in Schedule 5.2(e). (f) Except as specifically provided in this Section 5.2, Gaylord shall retain responsibility for (i) sponsorship of all of the Benefit Plans, all other applicable Gaylord benefit and compensation plans, and any other benefit or compensation plans formerly made available to employees, and (ii) all liabilities and obligations for employee benefits (including Gaylord employee stock options) and for claims relating to employment (or termination of employment) which are in respect of (y) retirees and other former employees of GTC, GCI, the Limited Partnership and the Station (regardless of whether such liabilities accrued before, on or following the Closing) and (z) Station Employees to the extent the event or events giving rise to the liability or obligation occurred predominantly on or prior to the Closing. (g) Effective as of the Effective Time, each Station Employee participating in the Gaylord Pension Plan as of the Effective Time shall become fully vested in his or her accrued benefit under the Gaylord Pension Plan. (h) Effective as of the Effective Time, CBS shall have in effect a profit-sharing plan that includes a qualified cash or deferred arrangement within the meaning of Section 401(k) of the Code (the "CBS 401(k) Plan") that will provide benefits to Station Employees as of the Effective Time. Each Station Employee participating in the Gaylord 401(k) Plan as of the Effective Time shall become a participant in CBS' 401(k) Plan as of the Effective Time. Effective as of the Effective Time, each Station Employee participating in the Gaylord 401(k) Plan as of the Effective Time shall become fully vested in his or her account balance under the Gaylord 401(k) Plan. 35 SECTION 5.3. GAYLORD SUBSIDIARIES AND THE LIMITED PARTNERSHIP TO CONTROL OPERATIONS PRIOR TO CLOSING DATE At all times commencing on the date hereof and ending on the Closing Date, the operation, management, control and supervision of all programs, equipment, operations and other activities of the Station shall be the sole responsibility and shall remain within the complete control and discretion of the Gaylord Subsidiaries and the Limited Partnership. Neither CBS, the CBS Subsidiaries nor any of their respective employees, agents or representatives, directly or indirectly, shall (or have any right to) control, direct or otherwise supervise, or attempt to control, direct or otherwise supervise any of the management or operations of the Station. SECTION 5.4. COPYRIGHT ROYALTY TRIBUNAL PAYMENTS To the extent not included in the prorations under Section 1.13, CBS agrees promptly upon receipt to remit to Gaylord any payments received by CBS as a Copyright Royalty Tribunal Payment attributable to the Limited Partnership's ownership and operation of the Station prior to the Closing Date. SECTION 5.5. ACCESS TO INFORMATION Subject to the provisions of Section 10.2, and upon reasonable notice, Gaylord shall, and shall cause each of its subsidiaries to, afford to CBS, its subsidiaries and their employees, officers, accountants, counsel, financial advisors and other representatives, reasonable access during normal business hours during the period prior to the Effective Time to all of its properties, books, contracts, management personnel and records relating to GTC, GCI, the Limited Partnership and the Station; provided, however, that, to the extent reasonably possible, such access shall be at Gaylord's offices in Nashville, Tennessee, and shall not unreasonably interfere with the normal operations of the Station. During such period, CBS shall, and shall cause each of its subsidiaries to, furnish promptly to Gaylord upon request a copy of each report, schedule, registration statement and other document required to be filed by it during such period pursuant to the requirements of Section 13(a) of the Exchange Act. SECTION 5.6. REASONABLE BEST EFFORTS Upon the terms and subject to the conditions set forth in this Agreement, CBS and Gaylord each agrees to use its reasonable best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things reasonably necessary, proper or advisable to consummate and make effective, in a timely manner, the Mergers and the other transactions contemplated by the Transaction Agreements, including (i) the obtaining of all necessary actions or non-actions, waivers (including the Waiver), consents, approvals, orders and authorizations from Governmental Entities and the making of all necessary registrations, declarations and filings and the taking of all steps as may be reasonably necessary to obtain an approval, waiver (including the Waiver), order or authorization from, or to avoid an action or proceeding by, any Governmental Entity, including the actions or divestitures by CBS or its Affiliates contemplated by Section 4.2(c), if required as a condition to the approval of the FCC or the satisfactory conclusion of DOJ and/or FTC review under the Improvements Act, (ii) the obtaining of all necessary waivers, consents, approvals, orders or authorizations from third parties, (iii) the defending of any suit, action or proceeding, whether judicial or administrative, challenging any Transaction Agreement or the consummation of any of the transactions contemplated by any 36 Transaction Agreement, including seeking to have any stay or temporary restraining order entered by any court or other Governmental Entity vacated or reversed and (iv) the execution and delivery of any additional instruments necessary to consummate the transactions contemplated by, and to fully carry out the purposes of, the Transaction Agreements. Gaylord shall obtain the consent to assignment of the microwave lease between the Limited Partnership and Dallas Main Center Limited Partnership and the lease with Crescent Real Estate, each as listed in Schedule 2.8 or, if such consents cannot be obtained, enter into replacement leases on terms not materially more disadvantageous to CBS, GTC, GCI and the Limited Partnership than those contained in the current microwave lease and Crescent Real Estate lease. CBS shall use its reasonable best efforts to cause the shares of CBS Common Stock issued and delivered to Gaylord hereunder to be registered pursuant to an effective registration statement under Section 5 of the Securities Act to be registered or otherwise duly qualified under all appropriate state securities or "blue sky" laws or regulations, and to be approved for listing on the NYSE. SECTION 5.7. USE OF GAYLORD NAME Immediately following the Effective Time, CBS shall cause the surviving corporations of the Mergers to: (i) cease and desist from all further use of the name "Gaylord", or any trade names, trademarks, identifying logos or service marks related thereto (including "Gaylord Broadcasting" and "GBC"), or any part or variation of any of the foregoing or any confusingly similar trade names, trademarks or logos (collectively, "Gaylord's Trademarks and Logos"); and (ii) to adopt new trade names, trademarks, identifying logos and service marks related thereto which are not confusingly similar to Gaylord's Trademarks and Logos. Nothing in this Section 5.7 shall prohibit CBS and the surviving corporations of the Mergers from using Gaylord's Trademarks and Logos to the extent reasonably necessary to fulfill their obligations under the Transaction Agreements; and provided further, that CBS and its subsidiaries, including the Limited Partnership, shall be permitted a reasonable time to transition signage, stationery, business cards, and the like, it being understood that CBS will use all reasonable efforts to expedite such transition. SECTION 5.8. ENVIRONMENTAL STUDY Within forty-five (45) days after the execution of this Agreement, CBS shall obtain, at its expense, and present to Gaylord, a Phase I environmental report (the "Phase I Report") from a licensed environmental engineer or firm (which shall be reasonably acceptable to Gaylord) with respect to the Station's real property. If the Phase I Report discloses conditions which require, in the opinion of the environmental engineer or firm performing the assessment, further sampling or investigation, Gaylord and the Limited Partnership shall grant CBS and its agents reasonable access to the Station's real property, and CBS shall cause such sampling or investigation to be performed at its expense and shall present the results and recommendations of the engineer or firm to Gaylord (the "Phase II Report"). Gaylord shall be responsible for the prompt correction or remediation of any environmental, health or safety violations or conditions disclosed in the Phase I Report or the Phase II Report, to the extent required by applicable law or any relevant Governmental Entity, it being understood that the remediation may continue following the Closing. The studies contemplated by this Section 5.8 and the remediation efforts in response thereto shall not hinder or delay the Closing of the transactions contemplated by this Agreement. SECTION 5.9. AGREEMENT NOT TO COMPETE (a) Gaylord and its subsidiaries shall not, and shall cause each of their Affiliates not to, directly or indirectly: (i) for a period of eighteen (18) months from the Effective Time own, 37 manage, operate, join, control or participate in the ownership, management, operation or control of, or permit the use of the Gaylord name by, or be connected in any manner with, any television broadcast station within a 75 mile radius from the Station's main transmitter site; (ii) for a period of twenty-four (24) months from the Effective Time induce or attempt to induce any Station Employee to leave the employ of the Station; (iii) knowingly hire for work in the Dallas/Fort Worth area any voluntarily terminating Station Employee for a period of six (6) months following such Station Employee's termination; (iv) knowingly hire for work outside the Dallas/Fort Worth area any voluntarily terminating Station Employee for a period of three (3) months following such Station Employee's termination; or (v) for a period of twenty-four (24) months from the Effective Time induce or attempt to induce any person, business or entity which is an advertiser with or supplier of the Station, or which otherwise is a contracting party with the Station, as of the Effective Time or at any time during the twenty-four (24) month period, to terminate any written or oral agreement or understanding with the Station. Nothing contained herein shall prevent Gaylord or its Affiliates from hiring any Station Employee involuntarily terminated by the Station. (b) Notwithstanding the provisions of Section 5.9(a), Gaylord or its Affiliates shall be entitled to invest in or otherwise affiliate with one or more entities that operate one or more television broadcast stations within a 75 mile radius from the Station's main transmitter site, so long as, during the eighteen (18) month period, Gaylord does not participate, directly or indirectly, in the operation of such television broadcast station. (c) Notwithstanding any other provision of this Agreement, it is understood and agreed that the remedy of indemnity payments pursuant to Section 8 and other remedies at law would be inadequate in the case of any breach of the covenants contained in Section 5.9(a). CBS and its subsidiaries shall be entitled to equitable relief, including the remedy of specific per formance, with respect to any breach or attempted breach of such covenants. SECTION 5.10. WAIVER OF CERTAIN CLAIMS Neither CBS nor its Affiliates shall be entitled to sue or otherwise prosecute a claim or cause of action for breach of fiduciary duty on behalf of the Limited Partnership, GTC or GCI (or their successors in interest) against any of their officers or directors with respect to any act or omission occurring prior to the Closing Date. SECTION 5.11. RECORDS As soon as practicable following the Closing Date, Gaylord shall deliver or cause to be delivered to CBS all agreements, documents, books, records and files, including records and files stored on computer disks or tapes or any other storage medium (collectively, "Records"), if any, in the possession of Gaylord or any of its subsidiaries (except GCI and GTC) relating to the business and operations of GCI, GTC, the Limited Partnership and the Station to the extent not then in the possession of GCI, GTC and the Limited Partnership, subject to the following exceptions: (a) CBS recognizes that certain Records may contain incidental information relating to GCI, GTC, the Limited Partnership or the Station or may relate primarily to subsidiaries, divisions or businesses of Gaylord other than GCI, GTC, the Limited Partnership and the Station, and that Gaylord may retain such Records and shall provide copies of the relevant portions thereof to CBS; 38 (b) Gaylord may retain all Records prepared in connection with the sale of the Station, including bids received from other parties and analyses relating to the Limited Partnership and the Station; and (c) Gaylord may retain any Tax Returns, and CBS shall be provided with copies of such Tax Returns if they relate to GCI's, GTC's or the Limited Partnership's separate Tax Returns or separate Tax liability. SECTION 5.12. POST CLOSING MATTERS The parties agree to the following, from and after the Effective Time: (a) In the event that prior to the Effective Time any asset of the Station suffers any damage, destruction or other casualty loss, Gaylord shall surrender to CBS after the Effective Time (i) all insurance proceeds received with respect to such damage, destruction or loss, less any proceeds applied to the physical restoration of such asset, and (ii) all rights of Gaylord with respect to any causes of action, whether or not litigation has commenced as of the Effective Time, in connection with such damage, destruction or loss. Gaylord shall make available to CBS the benefit of any workers' compensation, general liability, product liability, automobile liability, umbrella (excess) liability or crime or other insurance policy covering GTC, GCI, the Limited Partnership or the Station with respect to insured events or occurrences prior to the Effective Time (whether or not claims relating to such events or occurrences are made prior to or after the Effective Time); provided, however, that (i) all of Gaylord's costs and expenses incurred in connection with the foregoing shall promptly be paid by CBS, and (ii) the benefits of such insurance shall be subject to (and recovery thereon shall be reduced by the amount of) any applicable deductibles and co-payment provisions or any payment or reimbursement obligations of Gaylord in respect thereof. Gaylord shall promptly pay to CBS all insurance proceeds relating to the business of the Station received by Gaylord or its subsidiaries under any insurance policy. (b) Subject to the provisions of Section 5.7, and to the extent permitted by any third party licensor, CBS shall have a limited license to use the Intellectual Property and Technology transferred pursuant to Section 4.3(b) or that is not owned by GCI, GTC or the Limited Partnership but is used in the operation of the business of the Station for a period of ninety (90) days following the Effective Time; provided, however, that CBS shall use all reasonable efforts to make the transition to its own computer programs and systems and to terminate its reliance on the Intellectual Property and Technology as quickly as possible. To the extent that CBS reasonably requires a license beyond the first ninety (90) day period, CBS shall make a request to that effect to Gaylord, or to any applicable third party licensor, specifying the reasons for such need, and Gaylord shall not unreasonably withhold its consent to an extension of the limited license for up to an additional ninety (90) days. SECTION 6. CONDITIONS PRECEDENT TO OBLIGATIONS OF CBS The obligations of CBS under this Agreement shall be subject to the satisfaction (or waiver by CBS), on or prior to the Closing Date, of the following conditions. CBS shall not be entitled to assert the failure of any condition set forth herein if such failure is caused, in whole or in material part, by CBS' breach of any covenant or agreement hereunder. SECTION 6.1. CORPORATE ACTION Gaylord and the Gaylord Subsidiaries shall have taken all action necessary to approve the transactions contemplated by this Agreement, and shall have delivered certified copies of the 39 resolutions of the boards of directors of Gaylord and the Gaylord Subsidiaries, and unanimous resolutions of the shareholders of the Gaylord Subsidiaries, approving the transactions contemplated by this Agreement. SECTION 6.2. WAITING PERIOD; NO RESTRAINT OR INJUNCTION Any applicable waiting period under the Improvements Act shall have expired or have been terminated and there shall not be in effect any preliminary or permanent injunction or other order, decree or ruling by a court of competent jurisdiction, and there shall not be in effect any temporary restraining order of a court of competent jurisdiction, which, in either case, restrains or prohibits the transactions contemplated hereby. SECTION 6.3. FCC CONSENT The FCC Consent shall have been issued, without any condition or qualification that is materially adverse to CBS or its subsidiaries or the Station, and shall have become a Final Order; provided, however, that a condition contemplated by Section 4.2(c) shall not constitute such a material adverse condition or qualification. SECTION 6.4. REPRESENTATIONS AND WARRANTIES Subject to Section 10.16, the representations and warranties of Gaylord in this Agreement and the Tax Matters Agreement shall be true and correct as of the date hereof and as of the Closing Date as though made on the Closing Date, except to the extent that such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct on and as of such earlier date), in each case except for breaches as to matters that, individually or in the aggregate, would not reasonably be expected to have a Gaylord Material Adverse Effect the consequences of which substantially impair the physical assets or economic value or prospects of the Station taken as a whole. SECTION 6.5. NYSE LISTING The shares of CBS Common Stock to be issued and delivered to Gaylord pursuant to the Mergers shall have been approved for listing on the NYSE, subject to official notice of issuance. SECTION 6.6. BREACH OF COVENANT BY GAYLORD Subject to Section 10.16, Gaylord shall not have materially breached its obligations in any covenant or agreement hereunder. SECTION 7. CONDITIONS PRECEDENT TO OBLIGATIONS OF GAYLORD The obligations of Gaylord under this Agreement shall be subject to the satisfaction (or waiver by Gaylord), on or prior to the Closing Date, of the following conditions. Gaylord shall not be entitled to assert the failure of any condition set forth herein if such failure is caused, in whole or in material part, by Gaylord's breach of any covenant or agreement hereunder. 40 SECTION 7.1. CORPORATE ACTION CBS and the CBS Subsidiaries shall have taken all corporate action necessary to approve the transactions contemplated by this Agreement, and shall have delivered certified copies of the resolutions of the boards of directors of CBS and the CBS Subsidiaries, and unanimous resolutions of the shareholders of the CBS Subsidiaries, approving the transactions contemplated by this Agreement. SECTION 7.2. WAITING PERIOD; NO RESTRAINT OR INJUNCTION Any applicable waiting period under the Improvements Act shall have expired or been terminated and there shall not be in effect any preliminary or permanent injunction or other order, decree or ruling by a court of competent jurisdiction, and there shall not be in effect any temporary restraining order of a court of competent jurisdiction, which, in either case, restrains or prohibits the transactions contemplated hereby. SECTION 7.3. FCC CONSENT The FCC Consent shall have been issued and become effective, without any condition or qualification which is materially adverse to Gaylord. SECTION 7.4. REGISTRATION OF SHARES The registration statement to be filed with respect to the shares of CBS Common Stock to be issued and delivered to Gaylord pursuant to the Mergers shall have become effective under the Securities Act and shall not be the subject of any stop order or proceedings seeking a stop order, and CBS shall have received all state securities or "blue sky" authorizations necessary to issue the CBS Common Stock pursuant to the Mergers. SECTION 7.5. NYSE LISTING The shares of CBS Common Stock to be issued and delivered to Gaylord pursuant to the Mergers shall have been approved for listing on the NYSE, subject to official notice of issuance. SECTION 7.6. TAX MATTERS AGREEMENT BRING DOWN CERTIFICATE The Executive Vice President and Chief Financial Officer or the Executive Vice President and General Counsel of CBS shall have delivered a duly executed certificate reaffirming the accuracy of the matters described in Sections 4.1 and 4.2 of the Tax Matters Agreement as of the Closing Date. SECTION 7.7. NO MATERIAL ADVERSE CHANGE Except as disclosed in the Filed CBS SEC Documents or as otherwise expressly contemplated by the Transaction Agreements, since the date of the most recent financial statements included in the Filed CBS SEC Documents, there shall not have been any event, change or development which individually or in the aggregate has had or would reasonably be expected to have a Material Adverse Effect on CBS and its subsidiaries taken as a whole. 41 SECTION 7.8. TAX OPINION There shall have been, after the date hereof, no changes in law (including the Code, the Treasury Regulations, revenue rulings or other official written administrative interpretations, or judicial interpretations) that would prevent Skadden, Arps, Slate, Meagher & Flom, LLP, special tax counsel to Gaylord, from rendering an opinion substantially to the effect that each of the Mergers should constitute a "reorganization" within the meaning of Section 368(a) of the Code. In rendering such opinion, such counsel may rely upon the representations, covenants and warranties of the parties hereto, reasonably satisfactory to such counsel, contained in the Tax Matters Agreement. SECTION 7.9. BREACH OF COVENANT BY CBS Subject to Section 10.16. CBS shall not have materially breached its obligations in any covenant or agreement hereunder. SECTION 8. INDEMNIFICATION SECTION 8.1. INDEMNIFICATION BY GAYLORD (a) Subject to Section 8.1(b), Gaylord shall indemnify, defend and hold harmless CBS, its Affiliates (including, after the Effective Time, GTC, GCI and the Limited Partnership) and each of their respective officers, directors, employees, stockholders, agents and representatives and each of the heirs, executors, successors and assigns of any of the foregoing (the "CBS Indemnitees") from and against, and pay or reimburse the CBS Indemnitees for, all losses, liabilities, damages, deficiencies, obligations, fines, expenses, claims, demands, actions, suits, proceedings, judgments or settlements, whether or not resulting from Third Party Claims, including interest and penalties recovered by a third party with respect thereto and out-of-pocket expenses and reasonable attorneys' and accountants' fees and expenses incurred in the investigation or defense of any of the same or in asserting, preserving or enforcing any rights hereunder (collectively, "Losses"), suffered or incurred by the CBS Indemnitees (other than any Losses relating to Taxes, for which indemnification provisions are set forth in the Tax Matters Agreement), relating to or arising from: (i) the breach by Gaylord of any agreement or covenant contained in this Agreement; (ii) any breach or inaccuracy of any representation or warranty of Gaylord contained in this Agreement; or (iii) the ownership of GCI, GTC or the Limited Partnership or the operation of the Station prior to the Effective Time or the liabilities and obligations assumed by Gaylord pursuant to Section 4.3(b); or (iv) any business or activity of GCI, GTC or the Limited Partnership other than the ownership by GCI or GTC of its partnership interest in the Limited Partnership or the ownership or operation by the Limited Partnership of the Station and the assets relating thereto. (b) Gaylord shall not have any liability under Section 8.1(a)(ii) unless the aggregate of all Losses for which Gaylord would, but for this Section 8.1(b), be liable under Section 8.1(a)(ii) exceed on a cumulative pre-tax basis an amount equal to $1,000,000, and then only to the extent of any such excess; provided further, that Gaylord shall not have any liability under Section 8.1(a) for any amount in excess of $485,000,000 in the aggregate; provided, however, 42 that the foregoing threshold shall not apply to any such Losses relating to or arising from any breach or inaccuracy of the representations and warranties contained in Section 2.1, 2.2(a), 2.2(b), and 2.3; and provided further that neither the foregoing threshold nor the foregoing cap shall apply to any such Losses to the extent relating to or arising from the liabilities and obligations assumed by Gaylord pursuant to Section 4.3(b) or any business or activity of GCI, GTC or the Limited Partnership other than the ownership by GCI or GTC of its partnership interest in the Limited Partnership or the ownership or operation by the Limited Partnership of the Station and the assets relating thereto. (c) The parties hereto agree that the mere failure to list on a Schedule a contract required to be listed on the Schedules attached hereto shall not in and of itself constitute a Loss. The parties hereto further agree that the foregoing shall in no way limit or impair any right of any CBS Indemnitee to indemnification under Section 8.1(a) or to recover any Losses arising out of or otherwise related to any such contract or the terms thereof, when considered individually or together with the terms of any other contract, including with respect to any revenues that may be lower than otherwise reasonably anticipated by CBS, any expenses that may be higher than otherwise reasonably anticipated by CBS or any other Losses whatsoever resulting from such contract or its terms. The parties hereto further agree that this paragraph is not in any way intended to impose any different or more stringent burden of proof on any CBS Indemnitee in asserting or enforcing any right than that which may have existed in the absence of the foregoing. SECTION 8.2. INDEMNIFICATION BY CBS CBS shall indemnify, defend and hold harmless Gaylord, its Affiliates (excluding, after the Effective Time, GCI, GTC and the Limited Partnership) and each of their respective officers, directors, employees, stockholders, agents and representatives and each of the heirs, executors, successors and assigns of any of the foregoing (the "Gaylord Indemnitees" and, together with the CBS Indemnitees, the "Indemnitees") from and against, and pay or reimburse the Gaylord Indemnitees for, all Losses (other than any Losses relating to Taxes, for which indemnification provisions are set forth in the Tax Matters Agreement), suffered or incurred by the Gaylord Indemnitees, relating to or arising from : (i) the breach by CBS, CBS Dallas Ventures or CBS Dallas Media of any agreement or covenant contained in this Agreement; (ii) any breach or inaccuracy of any representation or warranty of CBS contained in this Agreement; or (iii) except to the extent of Gaylord's indemnification obligation under Section 8.1, the ownership of GCI, GTC or the Limited Partnership or the operation of the Station from and after the Effective Time. SECTION 8.3. TERMINATION OF INDEMNIFICATION The obligations to indemnify and hold harmless any party (i) pursuant to Section 8.1(a)(ii) and 8.2(ii) shall terminate when the applicable representation or warranty terminates pursuant to Section 10.1 and (ii) pursuant to Section 8.1(a)(i) and (iii) and Section 8.2(i) and (iii) shall not terminate; provided, however, that such obligations to indemnify and hold harmless shall not terminate with respect to any item as to which an Indemnitee shall have, before the expiration of the applicable period, previously made a claim by delivering a notice of such claim pursuant to Section 8.4 to the indemnifying party. 43 SECTION 8.4. PROCEDURES (a) In order for an Indemnitee to be entitled to any indemnification provided for under this Agreement in respect of, arising out of or involving a claim made by any person who is not an Indemnitee against the Indemnitee (a "Third Party Claim"), such Indemnitee must notify the party who may become obligated to provide indemnification hereunder (the "indemnifying party") in writing, and in reasonable detail, of the Third Party Claim reasonably promptly, and in any event within 20 business days after receipt by such Indemnitee of written notice of the Third Party Claim; provided, however, that failure to give such notification shall not affect the indemnification provided hereunder except to the extent the indemnifying party shall have been actually prejudiced as a result of such failure. After any required notification, the Indemnitee shall deliver to the indemnifying party, promptly after the Indemnitee's receipt thereof, copies of all notices and documents (including court papers) received by the Indemnitee relating to the Third Party Claim. (b) If a Third Party Claim is made against an Indemnitee, the indemnifying party will be entitled to participate in the defense thereof and, if it so chooses, to assume the defense thereof (at the expense of the indemnifying party) with counsel selected by the indemnifying party and reasonably satisfactory to the Indemnitee. Should the indemnifying party so elect to assume the defense of a Third Party Claim, the indemnifying party will not be liable to the Indemnitee for any legal expenses subsequently incurred by the Indemnitee in connection with the defense thereof. If the indemnifying party assumes such defense, the Indemnitee shall have the right to participate in the defense thereof and to employ counsel, at its own expense, separate from the counsel employed by the indemnifying party, it being understood that the indemnifying party shall control such defense. The indemnifying party shall be liable for the fees and expenses of counsel employed by the Indemnitee for any period during which the indemnifying party has not assumed the defense thereof (other than during any period in which the Indemnitee shall have failed to give notice of the Third Party Claim as provided above). Notwithstanding the foregoing, the indemnifying party shall not be entitled to assume the defense of any Third Party Claim (and shall be liable for the fees and expenses of counsel incurred by the Indemnitee in defending such Third Party Claim) if the Third Party Claim seeks an order, injunction or other equitable relief or relief for other than money damages against the Indemnitee which the Indemnitee reasonably determines, after conferring with its outside counsel, cannot be separated from any related claim for money damages. If such equitable relief or other relief portion of the Third Party Claim can be so separated from that for money damages, the indemnifying party shall be entitled to assume the defense of the portion relating to money damages. The indemnification required by Section 8.1 or 8.2, as the case may be, shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or the Losses are incurred. If the indemnifying party chooses to defend or prosecute a Third Party Claim, all the parties hereto shall cooperate in the defense or prosecution thereof, which cooperation shall include the retention and (upon the indemnifying party's request) the provision to the indemnifying party of records and information which are reasonably relevant to such Third Party Claim, and making employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder. If the indemnifying party chooses to defend or prosecute any Third Party Claim, the Indemnitee will agree to any settlement, compromise or discharge of such Third Party Claim which the indemnifying party may recommend and which by its terms obligates the indemnifying party to pay the full amount of liability in connection with such Third Party Claim; provided, however, that, without the Indemnitee's consent, the indemnifying party shall not consent to entry of any judgment or enter into any settlement (x) that provides for injunctive or other nonmonetary relief affecting the Indemnitee or (y) that does not include as an unconditional term thereof the giving by each claimant or plaintiff to such Indemnitee of a release from all liability with respect to such claim. If the indemnifying party shall have assumed the defense of a Third Party Claim, the Indemnitee 44 shall not admit any liability with respect to, or settle, compromise or discharge, such Third Party Claim without the indemnifying party's prior written consent (which consent shall not be unreasonably withheld). (c) In order for an Indemnitee to be entitled to any indemnification provided for under this Agreement in respect of a claim that does not involve a Third Party Claim, the Indemnitee shall deliver notice of such claim (in reasonably sufficient detail to enable the indemnifying party to evaluate such claim) with reasonable promptness to the indemnifying party. The failure by any Indemnitee so to notify the indemnifying party shall not relieve the indemnifying party from any liability which it may have to such Indemnitee under this Agreement, except to the extent that the indemnifying party shall have been actually prejudiced by such failure. If the indemnifying party does not notify the Indemnitee within 20 calendar days following its receipt of such notice that the indemnifying party disputes its liability with respect to such claim under Section 8.1 or 8.2, as the case may be, the claim shall be conclusively deemed a liability of the indemnifying party under Section 8.1 or 8.2, as the case may be, and the indemnifying party shall pay the amount of such liability to the Indemnitee on demand or, in the case of any notice in which the amount of the claim (or any portion thereof) is estimated, on such later date when the amount of such claim (or such portion thereof) becomes finally determined. If the indemnifying party has timely disputed its liability with respect to such claim, as provided above, the indemnifying party and the Indemnitee shall proceed in good faith to negotiate a resolution of such dispute and, if not resolved through negotiations, such dispute shall be resolved by litigation in an appropriate court of competent jurisdiction. (d) Notwithstanding any of the foregoing, Gaylord shall be responsible for defending any Third Party Claim pending at the Effective Time. Section 8.5. CERTAIN LIMITATIONS (a) The amount of any Losses for which indemnification is provided under this Agreement shall be net of any amounts actually recovered by the Indemnitee from third parties (including, without limitation, amounts actually recovered under insurance policies) with respect to such Losses. (b) All indemnification payments under this Agreement shall be determined on a pre-tax basis, i.e., without regard to the tax consequences to the Indemnitee of making a payment that is indemnified by another party under this Agreement or of receiving a payment under this Agreement as indemnification therefor. SECTION 9. TERMINATION SECTION 9.1. TERMINATION Notwithstanding anything contained in this Agreement to the contrary, this Agreement may be terminated at any time prior to the Closing: (a) by the mutual consent of Gaylord and CBS; (b) by Gaylord at any time, if the Closing has not occurred on or before the first anniversary of the execution of this Agreement; (c) by CBS at any time, if the Closing has not occurred on or before the date one (1) year and two (2) months following the execution of this Agreement; provided, however, that if 45 the granting of the FCC Consent is materially delayed because of any act or omission on the part of CBS, this time shall be extended by an additional ten (10) months; (d) by Gaylord or CBS if the FCC designates the FCC transfer applications for an evidentiary hearing; (e) by Gaylord if the condition set forth in Section 7.8 cannot be satisfied; or (f) as provided in Section 10.15. SECTION 9.2. SPECIFIC PERFORMANCE The parties recognize that if any party breaches this Agreement and refuses to perform under the provisions of this Agreement, monetary damages would not be adequate to compensate the other party for its injury. Each of CBS and Gaylord shall therefore be entitled, in addition to any other legal and equitable remedies that may be available, including money damages, to obtain specific performance of the terms of this Agreement. If any action is brought by either CBS or Gaylord to enforce this Agreement, the other parties shall waive the defense that there is an adequate remedy at law. SECTION 9.3. EFFECT OF TERMINATION The termination of this Agreement shall not affect the following sections of this Agreement, which shall remain in full force and effect following any termination: Sections 9.3, 10.2 and 10.10. In the event of any termination of this Agreement, and (subject to Section 10.16) Gaylord is not in material breach of its obligations under any covenant or agreement hereunder, CBS agrees that, at the option of Gaylord, it shall extend the Station's status as a CBS affiliate for a term of one (1) additional year past its then current expiration date, on the same terms and conditions then in effect (other than changes applicable to all affiliates generally and to the extent such changes would be binding on the Station under its current affiliate agreement), and CBS shall not unreasonably withhold its consent to any assignment of the Station to a transferee or assignee approved by the FCC. Any termination of this Agreement shall not relieve or release a party from responsibility hereunder for any breaches of or defaults under this Agreement nor shall it impair the right of any party to compel specific performance by any other party of its obligations under this Agreement. SECTION 10. GENERAL PROVISIONS SECTION 10.1. SURVIVAL OF REPRESENTATIONS, WARRANTIES AND OBLIGATIONS All representations, warranties, covenants and obligations contained in this Agreement shall survive the Effective Time; provided, however, that the representations and warranties contained in Sections 2 and 3 of this Agreement shall terminate eighteen (18) months after the Closing Date, except that (i) the representations and warranties in Section 2.20 shall terminate as of the second anniversary of the Closing Date and (ii) the representations and warranties relating to Taxes shall terminate at the time the applicable statute of limitations with respect to the Taxes in question expire (giving effect to any extension thereof). This Section 10.1 shall not limit any covenant or agreement of the parties which by its terms contemplates performance after the Effective Time. 46 SECTION 10.2. CONFIDENTIAL NATURE OF INFORMATION The Confidentiality Agreement between Gaylord and CBS dated as of January 21, 1999, shall remain in full force and effect to the extent not superseded by this Agreement; provided, however, that if the Closing takes place, the Confidentiality Agreement shall no longer apply to the extent it requires CBS or any of its Affiliates to treat in confidence any documents, materials or other information relating to GCI, GTC, the Limited Partnership or the Station. Each party further hereby agrees that it will treat in confidence all documents, materials and other information which it shall have obtained regarding the other party during the course of the negotiations leading to the consummation of the transactions contemplated hereby (whether obtained before or after the date of this Agreement), the investigation provided for herein and the preparation of this Agreement and other related documents, and, in the event the transactions contemplated hereby shall not be consummated, each party will return to the other party all copies of nonpublic documents and materials which have been furnished in connection therewith. Gaylord further agrees that, after the Closing Date, it will treat in confidence all documents, materials and other information relating to the business, assets, liabilities and operations of the Station which were confidential prior to the Closing. The obligation of each party to treat such documents, materials and other information in confidence shall not apply to any information which (a) such party can demonstrate was already lawfully in its possession prior to the disclosure thereof by the other party, (b) is known to the public and did not become so known through any violation of a legal obligation, (c) became known to the public through no fault of such party, (d) is later lawfully acquired by such party from other sources, (e) such party is permitted to disclose under this Agreement or (f) such party is required to disclose, pursuant to judicial order or, in the opinion of counsel, pursuant to applicable law. Without limiting the right of any party to pursue all other legal and equitable rights available to it for violation of this Section 10.2 by any other party, it is agreed that other remedies cannot fully compensate the aggrieved party for such a violation of this Section 10.2 and that the aggrieved party shall be entitled to injunctive relief to prevent a violation or continuing violation thereof. SECTION 10.3. GOVERNING LAW This Agreement and the transactions contemplated hereby shall be governed by and construed in accordance with the laws of the State of Delaware without reference to its choice of law rules. SECTION 10.4. NOTICES All notices or other communications required or permitted hereunder shall be in writing and shall be deemed given or delivered when delivered personally or by messenger or seventy-two (72) hours after having been sent by registered or certified mail or when delivered by private courier addressed as follows: If to CBS, to: CBS Corporation 51 West 52nd Street New York, NY 10019 Attention: Louis J. Briskman, Esq. with a copy to: 47 Cravath, Swaine & Moore 825 Eighth Avenue New York, NY 10019 Attention: Peter S. Wilson, Esq. If to Gaylord, to: Gaylord Entertainment Company One Gaylord Drive Nashville, Tennessee 37214 Attention: Joseph B. Crace with a copy to: Sherrard & Roe, PLC 424 Church Street, Suite 2000 Nashville, TN 37219 Attention: Thomas J. Sherrard, Esq. with a copy to: Reed Smith Shaw & McClay 1301 K Street, N.W. East Tower - Suite I 100 Washington, D.C. 20005 Attention: Brian A. Johnson, Esq. or to such other address as such party may indicate by a notice delivered to the other parties hereto. SECTION 10.5. SUCCESSOR AND ASSIGNS (a) The rights of a party under this Agreement shall not be assignable by such party without the prior written consent of CBS and Gaylord, except that upon written notice to the other party all or any portion of the rights of CBS or Gaylord hereunder (but not its obligations) may be assigned, without the consent of the other party, only to a direct wholly owned corporate subsidiary of CBS or Gaylord. (b) This Agreement shall be binding upon and inure to the benefit of the parties hereto and their successors and permitted assigns. The successors and permitted assigns hereunder shall include, without limitation, any permitted assignee as well as the successors in interest to such permitted assignee (whether by merger, liquidation (including successive mergers or liquidations) or otherwise). Except as expressly provided in Article 8, nothing in this Agreement, expressed or implied, is intended or shall be construed to confer upon any person other than the parties and successors and assigns permitted by this Section 10.5 any right, remedy or claim under or by reason of this Agreement. SECTION 10.6. ACCESS TO RECORDS AFTER CLOSING For a period of six (6) years after the Closing Date, Gaylord and its representatives shall have reasonable access to all of the books and records of the Station transferred to CBS and the CBS Subsidiaries hereunder to the extent that such access may reasonably be required by Gaylord in 48 connection with matters relating to or affected by the operations of the Station prior to the Closing Date. Such access shall be afforded by CBS upon receipt of reasonable advance notice and during normal business hours. Gaylord shall be solely responsible for any costs or expenses incurred by it pursuant to this Section 10.6. If CBS shall desire to dispose of any of such books and records prior to the expiration of such six-year period, CBS shall, prior to such disposition, give Gaylord a reasonable opportunity, at Gaylord's expense, to segregate and remove such books and records as Gaylord may select. For a period of six (6) years after the Closing Date, CBS and its representatives shall have reasonable access to all of the books and records relating to the Station which Gaylord or any of its Affiliates may retain after the Closing Date. Such access shall be afforded by Gaylord and its Affiliates upon receipt of reasonable advance notice and during normal business hours. CBS shall be solely responsible for any costs and expenses incurred by it pursuant to this Section 10.6. If Gaylord or any of its Affiliates shall desire to dispose of any of such books and records prior to the expiration of such six-year period, Gaylord shall, prior to such disposition, give CBS a reasonable opportunity, at CBS's expense, to segregate and remove such books and records as CBS may select. SECTION 10.7. ENTIRE AGREEMENT; AMENDMENTS This Agreement and the Exhibits and Schedules referred to herein, the other Transaction Agreements and the documents delivered pursuant hereto and thereto contain the entire understanding of the parties hereto with regard to the subject matter contained herein or therein, and supersede all prior agreements, understandings or intents between or among any of the parties hereto and related thereto (provided that nothing in this Agreement shall be deemed to supersede the provisions of the Merger Agreement dated as of February 9, 1997 among Westinghouse Electric Corporation, G Acquisition Corp. and Gaylord Entertainment Company and all other agreements related thereto, including the Post-Closing Covenants Agreement dated as of September 30, 1997, among Gaylord Entertainment Company, New Gaylord Entertainment Company and the subsidiaries of New Gaylord Entertainment Company party thereto from time to time). The parties hereto, by mutual agreement in writing, may amend, modify or supplement this Agreement. SECTION 10.8. INTERPRETATION Article titles and headings to sections herein are inserted for convenience of reference only and are not intended to be a part of or to effect the meaning or interpretation of this Agreement. The Schedules referred to herein shall be construed with and as an integral part of this Agreement to the same extent as if they were set forth verbatim herein, and disclosure of any information on any Schedule shall be deemed disclosure on all Schedules where such information is manifestly applicable excluding Schedule 2.5. SECTION 10.9. WAIVERS Any term or provision of this Agreement may be waived, or the time for its performance may be extended, in a writing signed by the party or parties entitled to the benefit thereof. The failure of any party hereto to enforce at any time any provision of this Agreement shall not be construed to be a waiver of such provision, nor in any way to affect the validity of this Agreement or any part hereof or the right of any party thereafter to enforce each and every such provision. No waiver of any breach of this Agreement shall be held to constitute a waiver of any other or subsequent breach. 49 SECTION 10.10. EXPENSES Whether or not the Closing takes place, and except as otherwise provided herein and subject to the following sentence, each party hereto will pay all of its own costs and expenses incident to its negotiation and preparation of this Agreement and to its performance and compliance with all agreements and conditions contained herein on its part to be performed or complied with, including the fees, expenses and disbursements of its counsel and accountants. Gaylord will pay all such costs and expenses on behalf of GTC, GCI and the Limited Partnership. SECTION 10.11. PARTIAL INVALIDITY Wherever possible, each provision hereof shall be interpreted in such manner as to be effective and valid under applicable law, but in case any one or more of the provisions contained herein shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provisions of this Agreement, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision or provisions had never been contained herein unless the deletion of such provision or provisions would result in such a material change as to cause completion of the transactions contemplated hereby to be unreasonable. SECTION 10.12. EXECUTION IN COUNTERPARTS This Agreement may be executed in one or more counterparts, each of which shall be considered an original instrument, but all of which shall be considered one and the same agreement, and shall become binding when one or more counterparts have been signed by each of the parties and delivered to each of the parties. SECTION 10.13. DEFINITIONS As used in this Agreement, the following terms have the meanings specified or referred to in this Section 10.13: "Accounting Firm" has the meaning specified in Section 1.13 of this Agreement. "Accounts Receivable" means the accounts held by the Limited Partnership and to which Gaylord is entitled as of the Effective Time for advertising and programming aired on the Station and for production and other services provided by the Limited Partnership prior to the Effective Time , including rights and claims to payments made by the Copyright Royalty Tribunal. "Affiliate" means, with respect to any person, any other person which directly or indirectly controls, is controlled by or is under common control with such person[, excluding, with respect to Gaylord, The Oklahoma Publishing Company]. "Balance Sheets" has the meaning specified in Section 2.4 of this Agreement. "Benefit Plans" has the meaning specified in Section 2.13 of this Agreement. "Cable Act Requirements" has the meaning specified in Section 2.26 of this Agreement. "CBS" has the meaning specified in the first paragraph of this Agreement. 50 "CBS Common Stock" has the meaning specified in the Recitals to this Agreement. "CBS Dallas Media" has the meaning specified in the first paragraph of this Agreement. "CBS Dallas Ventures" has the meaning specified in the first paragraph of this Agreement. "CBS Indemnitees" has the meaning specified in Section 8.1 of this Agreement. "CBS Material Adverse Effect" has the meaning specified in Section 3.3 of this Agreement. "CBS SEC Documents" has the meaning specified in Section 3.4 of this Agreement. "CBS Subsidiaries" has the meaning specified in the first paragraph of this Agreement. "Certificate of Limited Partnership" means the Certificate of Limited Partnership of New Gaylord Broadcasting Company, L.P., filed in the office of the Secretary of State of Texas on September 1, 1995, as amended on November 28, 1995 and December 4, 1995 to change its name to Gaylord Broadcasting Company, L.P. "Closing" has the meaning specified in Section 1.2 of this Agreement. "Closing Date" has the meaning specified in Section 1.2 of this Agreement. "Code" means the Internal Revenue Code of 1986, as amended. "Collection Period" has the meaning specified in Section 4.4 of this Agreement. "Communications Act" means the Communications Act of 1934, as amended, and the rules and regulations and written policies and procedures promulgated thereunder. "Constituent Corporations" has the meaning specified in the first paragraph of this Agreement. "Contaminant" means any waste, pollutant, hazardous substance, toxic or radioactive substance, hazardous waste, special waste, petroleum or petroleum-derived substance or waste, or any constituent of any such substance or waste. "DTV" has the meaning specified in Section 2.27 of this Agreement. "DTV Facility" has the meaning specified in Section 2.27 of this Agreement. "DOJ" has the meaning specified in Section 4.2 of this Agreement. "Effective Time" has the meaning specified in Section 1.3 of this Agreement. "Encumbrance" means any lien, claim, charge, security interest, mortgage, pledge, easement, conditional sale or other title retention agreement, defect in title, covenant or other restrictions of any kind. "Event of Loss" has the meaning specified in Section 10.15 of this Agreement. 51 "Exchange Act" has the meaning specified in Section 2.2 of this Agreement. "FAA" means the Federal Aviation Administration. "FCC" has the meaning specified in Section 2.2 of this Agreement. "FCC Authorizations" means those Permits issued by the FCC for the operation of the Station. "FCC Consent" means action by the FCC granting its consent to the transfer of control to CBS (or an Affiliate of CBS) of the FCC Authorizations as contemplated by this Agreement pursuant to appropriate applications filed by the parties with the FCC. "Filed CBS SEC Documents" has the meaning specified in Section 3.7 of this Agreement. "Final Determination" has the meaning specified in Section 1.4 of the Tax Matters Agreement. "Final Order" means a written action or order issued by the FCC, setting forth the FCC Consent, (a) which has not been reversed, stayed, enjoined, set aside, annulled or suspended, and (b) with respect to which (i) no requests have been filed for administrative or judicial review, reconsideration, appeal or stay and the time for filing any such requests for administrative or judicial review, reconsideration or appeal, and the time for the FCC to set aside the action on its own motion, have expired, or (ii) in the event of review, reconsideration or appeal, the FCC's order has been affirmed and become final by expiration of the time for further review, reconsideration or appeal. "Financial Statements" has the meaning specified in Section 2.4 of this Agreement. "Financial Statement Date" has the meaning specified in Section 2.4 of this Agreement. "FTC" has the meaning specified in Section 4.2 of this Agreement. "GAAP" means generally accepted accounting principles. "Gaylord" has the meaning specified in the first paragraph of this Agreement. "Gaylord's 401(k) Plan" has the meaning specified in Section 5.2 of this Agreement. "Gaylord Indemnitees" has the meaning specified in Section 8.2 of this Agreement. "Gaylord Material Adverse Effect" has the meaning specified in Section 2.1 of this Agreement. "Gaylord's Pension Plan" has the meaning specified in Section 5.2 of this Agreement. "Gaylord Subsidiaries" has the meaning specified in the first paragraph of this Agreement. "Gaylord Subsidiary Stock" has the meaning specified in the Recitals to this Agreement. 52 "Gaylord's Trademarks and Logos" has the meaning specified in Section 5.7 of this Agreement. "GCI" has the meaning specified in the first paragraph of this Agreement. "GCI Articles of Merger" has the meaning specified in Section 1.3 of this Agreement. "GCI Certificate of Merger" has the meaning specified in Section 1.3 of this Agreement. "GCI Merger" has the meaning specified in the Recitals to this Agreement. "GCI Stock" has the meaning specified in the Recitals to this Agreement. "Governmental Entity" has the meaning specified in Section 2.2 of this Agreement. "GTC" has the meaning specified in the first paragraph of this Agreement. "GTC Certificate of Merger" has the meaning specified in Section 1.3 of this Agreement. "GTC Merger" has the meaning specified in the Recitals to this Agreement. "GTC Stock" has the meaning specified in the Recitals to this Agreement. "Identified Agreements" has the meaning specified in Section 1.13(e) of this Agreement. "Improvements Act" means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. "Including" means including, without limitation. "Indemnitees" has the meaning specified in Section 8.2 of this Agreement. "Lease" has the meaning specified in Section 2.8 of this Agreement. "Leased Property" has the meaning specified in Section 2.8 of this Agreement. "Liabilities and Costs" means all liabilities, investigations, responsibilities, losses, damages, punitive damages, consequential damages, treble damages, costs and expenses (including, without limitation, attorney, expert and consulting fees and expenses, costs of investigation and feasibility studies), fines, penalties and monetary sanctions, interest, direct or indirect, known or unknown, absolute or contingent, past, present or future. "Limited Partnership" has the meaning specified in the Recitals to this Agreement. "Limited Partnership Agreement" means the Agreement of Limited Partnership of New Gaylord Broadcasting Company, L. P. dated as of September 1, 1995, as amended on February 1, 1999 to change its name to Gaylord Broadcasting Company, L.P. "Losses" has the meaning specified in Section 8.1 of this Agreement. 53 "Market Cable System" means any U.S. cable television system within the Station's market, as defined in 47 C.F.R. ' 76.55(c) with two thousand (2000) or more subscribers. "Material Adverse Effect" means, when used in connection with an entity or group of entities, any change, effect, event or occurrence that is materially adverse to the business, properties, assets, financial condition, results of operations or prospects of such entity or group, taken as a whole, other than any change, effect, event or occurrence relating to the United States or the Dallas/Fort Worth economies in general, to United States stock market conditions in general, or to the entity's or group's industry or industries in general and not to the entity or group specifically. "Mergers" has the meaning specified in the Recitals to this Agreement. "Notice of Disagreement" has the meaning specified in Section 1.13 of this Agreement. "NYSE" means The New York Stock Exchange. "Organizational Documents" has the meaning specified in Section 2.1 of this Agreement. "Owned Property" has the meaning specified in Section 2.8 of this Agreement. "Permits" has the meaning specified in Section 2.2 of this Agreement. "Permitted Encumbrances" has the meaning specified in Section 2.9 of this Agreement. "Phase I Report" has the meaning specified in Section 5.8 of this Agreement. "Phase II Report" has the meaning specified in Section 5.8 of this Agreement. "Records" has the meaning specified in Section 5.11 of this Agreement. "Release" means any release, spill, emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal, leaching or migration into the indoor or outdoor environment or into or out of any structure, including the movement of Contaminants through or in the air, soil, surface water, groundwater or structure. "Relevant Taxes" has the meaning ascribed in Section 2.6 of this Agreement. "Remedial Action" means actions required to (a) clean up, remove, treat or in any other way address Contaminants in the indoor or outdoor environment; (b) prevent the Release or threat of Release or minimize the further Release of Contaminants so they do not migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment; or (c) perform pre-remedial studies and investigations and post-remedial monitoring and care. "Requirements of Law" means any foreign, federal, state or local law, rule or regulation, common law, order, consent, agreement, judgment, decree, governmental Permit or other binding determination of any Governmental Entity. "Securities Act" has the meaning specified in Section 2.2 of this Agreement. "Settlement Statement" has the meaning specified in Section 1.13 of this Agreement. 54 "Spots" has the meaning specified in Section 1.10 of this Agreement. "Station" has the meaning specified in the Recitals to this Agreement. "Station Employees" has the meaning specified in Section 2.11 of this Agreement. "Tax Authority" has the meaning specified in Section 1.17 of the Tax Matters Agreement. "Taxes" has the meaning specified in Section 2.6 of this Agreement. "Tax Matters Agreement" means the Tax Matters Agreement dated the date hereof by and between Gaylord, GTC, GCI and CBS, a copy of which is attached hereto as Exhibit A. "Tax Returns" has the meaning specified in Section 2.6 of this Agreement. "Third Party Claim" has the meaning specified in Section 8.4 of this Agreement. "To the best of CBS's knowledge" or any similar formulation means to the actual knowledge, after due inquiry into the areas of their respective responsibility, including without limitation review of their internal files and records, of Mel Karmazin, Frederick G. Reynolds and Louis J. Briskman (it being understood that no attorney-client privilege or work product privilege shall be waived or compromised by this provision). "To the best of Gaylord's knowledge" or any similar formulation means to the actual knowledge, after due inquiry into the areas of their respective responsibility, including review of their internal files and records, of Joseph B. Crace, Carl Kornmeyer, Mark Floyd, and Brian Jones. "Transaction Agreements" has the meaning specified in Section 2.2 of this Agreement. "Treasury Regulations" has the meaning specified in Section 2.6 of this Agreement. "Waiver" means a permanent waiver or a temporary waiver of at least six (6) months' duration, including a temporary waiver conditioned on the outcome of the FCC's pending rule-making proceeding with respect to its television ownership rules (MM Docket Nos. 91-221 and 87- 8), of the "one-to-a-market rule," 47 C.F.R. ss.73 3555(c), to permit the common ownership and control by CBS of the Station and the radio stations in the Dallas/Fort Worth area currently under CBS's ownership and control. SECTION 10.14. CONTROLLING PROVISIONS Notwithstanding anything herein to the contrary, nothing in this Agreement shall be construed as limiting the provisions contained in the Tax Matters Agreement, and in the case of doubt or conflict, the terms of the Tax Matters Agreement shall control. SECTION 10.15. RISK OF LOSS The risk of loss, damage or destruction to any of the assets of the Limited Partnership to be transferred to CBS pursuant to this Agreement shall remain with Gaylord until the Closing. If any of the assets material to the operation of the Station is lost, damaged or destroyed prior to the Closing Date (an "Event of Loss"), Gaylord shall promptly notify CBS of all particulars thereof, 55 including the cause (if known) and the extent to which the cost of restoration, replacement and/or repair of the lost, damaged or destroyed assets will be reimbursed under any insurance policy. Gaylord, at its expense, shall use its reasonable best efforts to restore, repair or replace the assets with comparable property of like value or quality as soon as practicable after the Event of Loss and, if applicable, to restore all transmissions that were interrupted due to the Event of Loss. If an Event of Loss results in failure to satisfy the condition to CBS' obligations to close under Section 6.4, then CBS may, at its option: (a) terminate this Agreement; or (b) postpone the Closing Date until such time as the assets have been restored, repaired or replaced in a manner and to an extent reasonably satisfactory to CBS, unless the same cannot be reasonably effected within one hundred twenty (120) days of the date CBS received notice from Gaylord of the Event of Loss, in which case either Gaylord or CBS may terminate this Agreement; or (c) choose to accept the assets "as is", in which event Gaylord shall assign or cause to be assigned to CBS all rights under any insurance claims covering the loss, damage or destruction of the assets and pay over or cause to be paid over to CBS any proceeds under any such insurance policies received by Gaylord or any of its subsidiaries prior to or after the Closing Date with respect thereto. In the event the Closing Date is postponed pursuant to this Section 10.15, CBS and Gaylord will cooperate to extend the time during which this Agreement must be closed as specified in the consent of the FCC. SECTION 10.16. RESOLUTION OF DISPUTES OVER SATISFACTION OF CONDITIONS In the event (a) CBS or Gaylord, as applicable, determines that the condition set forth in Section 6.4, 6.6 or 7.9 has not been satisfied at the Closing Date (and CBS or Gaylord, as applicable, is not prepared to waive such condition), or (b) CBS shall determine pursuant to Section 9.3 that Gaylord is in material breach of its obligations and is unwilling to extend the Station's status as an affiliate for an additional one year term, then the party making such determination shall deliver to the other party a notice setting forth in reasonable detail the facts and circumstances upon which the determination was made. In the event the other party does not agree with such determination, the Closing shall be delayed or final determination of non-renewal of affiliate status shall be delayed, as the case may be, and such party shall be entitled to a ten (10) day period from receipt of the notice within which to cause the condition to be satisfied or the breach to be cured. If the dispute is not resolved within the ten (10) day period, CBS and Gaylord shall submit the dispute to a mutually agreed-upon law professor with at least ten (10) years' experience in the law of corporate transactions and television broadcasting; provided, that if the parties cannot agree upon a law professor, the party making the determination of non-satisfaction of a condition or of material breach, as applicable, shall select either Jams/Endisputes or CPR Institute for Dispute Resolution, and the other party may accept the selection or elect the other entity and the choice of that party shall be binding. The choice of person or entity to resolve the dispute shall be made within five (5) working days after the expiration of the ten (10) day grace period, and such person or entity shall be referred to as the "Arbitrator." Within five (5) days of the selection of the Arbitrator, CBS and Gaylord shall submit their respective positions to the Arbitrator, in writing, together with any other material relied upon in support of their respective positions. The party claiming that a condition has not been satisfied or alleging a material breach shall have the burden of persuasion. CBS and 56 Gaylord shall use their reasonable efforts to cause the Arbitrator to render a decision within ten (10) days following the submission of such materials to the Arbitrator and in no event later than forty-five (45) days from the date on which the determination was made by a party that a condition had not been satisfied or that a material breach had occurred, as applicable. The Arbitrator's decision shall be final and binding upon the parties. The cost of any arbitration pursuant to this Section 10.16 shall be borne one-half by CBS and one-half by Gaylord; provided that CBS and Gaylord shall each pay the fees and expenses of their respective attorneys. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written. GAYLORD ENTERTAINMENT COMPANY By: /s/ Frederic G. Reynolds ------------------------ Its: _______________________ GAYLORD TELEVISION COMPANY By: /s/ Frederic G. Reynolds ------------------------ Its: _______________________ GAYLORD COMMUNICATIONS, INC By: /s/ Frederic G. Reynolds ------------------------ Its: _______________________ CBS CORPORATION By: /s/ Frederic G. Reynolds ------------------------ Its: _______________________ CBS DALLAS VENTURES, INC. By: /s/ Frederic G. Reynolds ------------------------ Its: _______________________ 57 CBS DALLAS MEDIA, INC. By: /s/ Joseph B. Crace ------------------------ Its: _______________________ The Limited Partnership joins in the execution of this Agreement and agrees to be bound hereby. GAYLORD BROADCASTING COMPANY, L.P. By: Gaylord Television Company, its general partner By: /s/ Joseph B. Crace ------------------------ Its: _______________________ EX-2.3 3 FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER FIRST AMENDMENT TO AGREEMENT AND PLAN OF MERGER FIRST AMENDMENT DATED AS OF October 8, 1999 (this "First Amendment") to the Agreement and Plan of Merger dated as of April 9, 1999 (the "Merger Agreement"), by and among Gaylord Entertainment Company, a Delaware corporation ("Gaylord"), Gaylord Television Company, a Delaware corporation ("GTC"), Gaylord Communications, Inc., a Texas corporation ("GCI"), CBS Corporation, a Pennsylvania corporation ("CBS"), CBS Dallas Ventures, Inc., a Delaware corporation ("CBS Dallas Ventures"), and CBS Dallas Media, Inc., a Delaware corporation ("CBS Dallas Media"). WITNESSETH: WHEREAS Gaylord, GTC, GCI, CBS, CBS Dallas Ventures and CBS Dallas Media have entered into the Merger Agreement, pursuant to which CBS Dallas Ventures will be merged with and into GCI, with GCI as the surviving corporation, and, as a result, GCI will become a direct wholly owned subsidiary of CBS, and pursuant to which CBS Dallas Media will be merged with and into GTC, with GTC as the surviving corporation, and, as a result, GTC will become a direct wholly owned subsidiary of CBS; WHEREAS CBS has entered into a merger agreement dated as of September 6, 1999 (as amended and restated as of October 8, 1999, and as it may be further amended from time to time, the "Viacom Merger Agreement") with Viacom Inc. ("Viacom"), pursuant to which and subject to the terms and conditions thereof, the holders of CBS Common Stock (as defined in the Merger Agreement) will receive, in exchange for shares of CBS Common Stock, shares of Class B Common Stock, par value $ .01 per share, of Viacom (the "Viacom Class B Stock") upon the effective time of the Merger (as defined in the Viacom Merger Agreement, and referred to herein as the "Viacom Merger"); WHEREAS the parties to the Merger Agreement desire to amend the Merger Agreement to provide, among other things, that the shares to be delivered to Gaylord pursuant to and in accordance with the terms of the Merger Agreement shall be CBS Preferred Stock (as defined below) in lieu of CBS Common Stock, and for the registration under the Securities Act of 1933 (the "Securities Act") of the resale by Gaylord of the shares of CBS Common Stock issuable to Gaylord upon conversion of the shares of CBS Preferred Stock (the "CBS Conversion Shares"); WHEREAS, immediately prior, and as a condition, to the execution of this First Amendment, CBS and Viacom amended and restated the Viacom Merger Agreement to provide that, upon the closing of the Viacom Merger, outstanding shares of CBS Preferred Stock shall be converted into voting shares of Viacom Preferred Stock (as defined below) that will be convertible into duly registered shares of Viacom Class B Stock; WHEREAS the respective Boards of Directors, or duly authorized committees thereof, of Gaylord, CBS, GTC, GCI, CBS Dallas Ventures and CBS Dallas Media have approved, and declared it advisable and in the best interest of their respective companies and stockholders to enter into the Merger Agreement, as amended hereby; and WHEREAS capitalized terms used and not defined herein shall have the respective meanings given to such terms in the Merger Agreement. NOW, THEREFORE, the parties hereto, intending to be legally bound, agree as follows: ARTICLE I AMENDMENTS SECTION 1.1 The first sentence of Section 1.2 of the Merger Agreement is hereby deleted and the following sentence is substituted in lieu thereof: Unless this Agreement shall have been terminated and the transactions herein contemplated shall have been abandoned pursuant to Section 9, and subject to any extension permitted by Section 10.15 or 10.16 and to the satisfaction or (subject to applicable law) waiver of the conditions set forth in Sections 6 and 7, the consummation of the Mergers will take place on October 12, 1999. SECTION 1.2 Clause (iii) of Section 1.8 of the Merger Agreement is hereby deleted and the following clause is substituted in lieu thereof: (iii) the aggregate of the shares of GCI Stock and GTC Stock issued and outstanding immediately prior to the Effective Time shall be converted into the right to receive the number of duly authorized, validly issued, fully paid and non-assessable shares of Series B Participating Preferred Stock, par value $1.00 per share, of CBS (the "CBS Preferred Stock") determined under Section 1.9 of this Agreement, which shares of CBS Preferred Stock shall have the rights, limitations and preferences set forth in the Statement With Respect to Shares attached hereto as Exhibit A. SECTION 1.3 Section 1.9 of the Merger Agreement is hereby deleted and the following section is substituted in lieu thereof: Section 1.9 Consideration for Mergers As of the Effective Time, CBS shall (i) issue and deliver to Gaylord one or more certificates registered in the name of Gaylord evidencing in the aggregate the number of shares (including fractional shares rounded to the nearest 1/1,000th) of CBS Preferred Stock equal to the quotient of Four Hundred Eighty-Five Million Dollars ($485,000,000) divided by the product of (a) the "Market Price" multiplied by (b) 1,000, and (ii) deliver to Gaylord by wire transfer in immediately available funds to an account designated in writing by Gaylord the sum of Four Million Two Hundred Thousand Dollars ($4,200,000). The "Market Price" means the average of the daily closing prices per share of CBS Common Stock as reported on the NYSE Composite Transactions Tape (as reported by the Wall Street Journal or, if not reported thereby, by another authoritative source mutually selected by Gaylord and CBS) for the fifteen (15) consecutive full NYSE trading days immediately preceding the third full NYSE trading day prior to the date on which the Closing Date shall occur. Gaylord and CBS agree to allocate one percent (1%) and ninety-nine percent (99%) of the consideration received from CBS hereunder to the GCI Stock and the GTC Stock, respectively. SECTION 1.4 The following sentence is added to the end of Section 1.10: In the event of a sale of the Station by the Limited Partnership or by its successors and assigns (the "Seller"), the Seller shall require that the purchaser of the Station agree to assume, be bound by and perform the remaining unperformed obligations under this Section 1.10. SECTION 1.5 CBS, Gaylord, GTC and GCI shall, simultaneously with the execution of this First Amendment, enter into the Amended and Restated Tax Matters Agreement. SECTION 1.6. The following Sections are hereby added to Section 2 of the Merger Agreement: Section 2.28 Purchase for Own Account The shares of CBS Preferred Stock to be acquired by Gaylord pursuant to the Mergers will be acquired for investment for Gaylord's own account, not as a nominee or agent, and not with a view to the resale or public distribution of any part thereof in violation of any requirements of the Securities Act or applicable state securities laws. Section 2.29 Restricted Securities Gaylord understands and acknowledges that the acquisition by Gaylord of the shares of CBS Preferred Stock pursuant to the Mergers has not been, and neither such shares of CBS Preferred Stock nor, except as provided in Section 5.14, the CBS Conversion Shares will be, registered under the Securities Act, and that such shares of CBS Preferred Stock are, and the CBS Conversion Shares will be, "restricted securities" under applicable U.S. federal and state securities laws and that, pursuant to these laws, Gaylord must hold such shares of CBS Preferred Stock and the CBS Conversion Shares indefinitely unless their resale is registered with the SEC and qualified by state authorities, or an exemption from such registration and qualification requirements is available. Section 2.30 Legend Gaylord understands and acknowledges that the certificates evidencing the shares of CBS Preferred Stock to be acquired by Gaylord pursuant to the Mergers, and the CBS Conversion Shares issuable upon conversion of the shares of CBS Preferred Stock, will bear the following legend: THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND NO SALE OR DISTRIBUTION OF SUCH SECURITIES MAY BE EFFECTED WITHOUT EITHER AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OF 1933. Section 2.31 Accredited Investor Gaylord is an accredited investor as defined in Rule 501(a) of Regulation D promulgated under the Securities Act. SECTION 1.7 Schedule 2.16 is hereby amended by the addition, or correction, of the items set forth on the Amendment to Schedule 2.16 attached hereto. In addition, the last sentence of Section 2.8 is hereby deleted and the following sentence is substituted in lieu thereof: The lease agreements described in items 7, 8 and 10 under the 'Purchase, sale or lease of real property' heading to Schedule 2.16 do not, individually or collectively, materially interfere with the business and operations of the Station as currently conducted. SECTION 1.8 Section 3.2 of the Merger Agreement is hereby deleted and the following section is substituted in lieu thereof: Section 3.2 CBS Capital Stock to be Issued in this Transaction The issuance of the CBS Preferred Stock to Gaylord pursuant to this Agreement, and the CBS Conversion Shares issuable upon conversion of the CBS Preferred Stock, have been duly authorized by all necessary corporate action on the part of CBS. When issued and delivered to Gaylord pursuant to this Agreement, the CBS Preferred Stock shall be duly authorized, validly issued, fully paid, non-assessable, shall have the rights, limitations and preferences set forth on Exhibit A hereto, and shall not be subject to preemptive rights. If and when issued and delivered upon conversion of the CBS Preferred Stock, the CBS Conversion Shares shall be validly issued, fully paid, non-assessable and not subject to preemptive rights. SECTION 1.9 Section 3.3 of the Merger Agreement is hereby amended by deleting the last paragraph therein and substituting the following in lieu thereof: Except for (i) consents, approvals, licenses, permits, orders, authorizations, registrations, declarations, filings or applications as may be required under, and other applicable requirements of, the Exchange Act, the Securities Act, the Improvements Act and any foreign competition laws, (ii) filings under state securities or "blue sky" laws, (iii) filings with the NYSE, (iv) approvals of and filings with the FCC under the Communications Act, (v) the filing with the Secretary of State of the Commonwealth of Pennsylvania of a Statement With Respect to Shares pursuant to Section 1522 of the Pennsylvania Business Corporation Law (the "PBCL"), (vi) the filing of the GCI Articles of Merger with the Secretary of State of the State of Texas, the filing of the GCI Certificate of Merger and the GTC Certificate of Merger with the Secretary of State of the State of Delaware and the filing of appropriate documents with the relevant authorities of other jurisdictions in which the CBS Subsidiaries are qualified to do business and (vii) other consents, approvals, orders, authorizations, registrations, declarations, filings and applications expressly provided for in the Transaction Agreements, no consent, approval, license, permit, order or authorization of, or registration, declaration or filing with, any Governmental Entity is required by or with respect to CBS or any subsidiary of CBS in connection with the execution, delivery or performance by CBS and the CBS Subsidiaries of each Transaction Agreement to which any of them is, or is specified to be, a party or the consummation by CBS and the CBS Subsidiaries of the transactions contemplated thereby (except where the failure to obtain such consents, approvals, licenses, permits, orders or authorizations, or to make such registrations, declarations or filings, would not, individually or in the aggregate, have a CBS Material Adverse Effect). SECTION 1.10 The last sentence of Section 5.6 of the Merger Agreement is hereby deleted and the following sentence is substituted in lieu thereof: CBS shall use its reasonable best efforts to cause the CBS Conversion Shares to be approved for listing on the NYSE, subject to official notice of issuance. SECTION 1.11 The following Sections are hereby added to Section 5 of the Merger Agreement: Section 5.13 Viacom Merger Agreement; Class Vote; Transfer Restrictions (a) CBS hereby represents that Schedule 5.13 attached hereto sets forth a true and correct copy of the Amended and Restated Viacom Merger Agreement dated as of October 8, 1999 (together with any exhibits thereto, as it or they may be further amended from time to time, the "Viacom Merger Agreement") executed by CBS and Viacom, including the form of the Restated Certificate of Incorporation of Viacom (which is Exhibit A-1 thereto and is referred to herein as the "Viacom Certificate") setting forth the rights, limitations and preferences of the Series C Preferred Stock, par value $.01 per share, of Viacom (the "Viacom Preferred Stock"), into which the CBS Preferred Stock shall be converted pursuant to the Merger (as defined in the Viacom Merger Agreement). CBS hereby covenants that (i), as of the effective time of the Merger (as defined in the Viacom Merger Agreement), Section 5 of Article IV of the Viacom Certificate shall be effective in the form attached hereto, (ii) without the prior written consent of Gaylord, which consent shall not be unreasonably withheld, CBS will not enter into any amendment to, or waive any condition to closing of, the Viacom Merger Agreement that would change adversely any of the rights or privileges of the Viacom Preferred Stock or the rights of a holder of the Viacom Preferred Stock to receive shares covered by the Registration Statement (as defined in the Viacom Merger Agreement) in accordance with the terms of the Viacom Merger Agreement as in effect on the date hereof, including, without limitation, any amendment that would change the Preferred Exchange Ratio (as defined in the Viacom Merger Agreement) and (iii) CBS shall provide a copy of any further amendment to the Viacom Merger Agreement to Gaylord within five (5) days following execution thereof. (b) The parties acknowledge that, in certain instances, Section 1924 in conjunction with Section 1914 of the PBCL entitle holders of a class or series of stock of a Pennsylvania corporation to vote separately as a class or series upon the adoption of a plan of merger or consolidation. The parties mutually agree that such a separate class or series vote by holders of shares of CBS Preferred Stock is not required in order for shareholders of CBS to properly adopt the Viacom Merger Agreement under the PBCL. However, in the event it is later determined in CBS' sole discretion that a separate class or series vote by holders of shares of CBS Preferred Stock is or may be required in order for shareholders of CBS to properly adopt the Viacom Merger Agreement, Gaylord hereby covenants and agrees that, at any meeting of CBS shareholders at which holders of CBS Preferred Stock are asked to vote upon the Viacom Merger Agreement, and in any action by written consent of such holders, when voting as a separate class or series, Gaylord shall vote all its shares of CBS Preferred Stock in favor of the adoption of the Viacom Merger Agreement. Gaylord hereby covenants and agrees that, at any meeting of Viacom shareholders at which holders of Viacom Preferred Stock are asked to vote upon increasing the number of authorized shares of preferred stock of Viacom, and in any action by written consent of such holders, when voting as a separate class or series, Gaylord shall vote all its shares of Viacom Preferred Stock in favor of increasing the number of authorized shares of preferred stock of Viacom. Gaylord further covenants and agrees that it shall not enter into any voting agreement or other agreement or understanding with any person or entity with respect to the voting of its shares of Viacom Preferred Stock or grant a proxy or power of attorney with respect to its shares of Viacom Preferred Stock unless the party to whom Gaylord grants such proxy or power of attorney agrees to vote such shares in accordance with Gaylord's covenants in this Section 5.13(b), and it hereby waives and agrees that it will not exercise any dissenters rights that it may have in connection with the Merger (as defined in the Viacom Merger Agreement) pursuant to Section 1571 of the PBCL. Gaylord hereby covenants and agrees that it shall not transfer record or beneficial ownership of any of the shares of CBS Preferred Stock unless the transferee unconditionally agrees in writing to be bound by the terms and conditions of this Section 5.13. (c) Gaylord, by this Agreement, hereby irrevocably constitutes and appoints CBS, with full power of substitution, as Gaylord's true and lawful attorney and proxy, for and in its name, place and stead, to vote each of the shares of CBS Preferred Stock held by Gaylord as Gaylord's proxy to vote, in any separate class or series vote by holders of shares of CBS Preferred Stock, in favor of the adoption of the Viacom Merger Agreement and any other proposal necessary to consummate the transactions contemplated by the Viacom Merger Agreement in effect on the date hereof at any meeting or action by written consent of CBS shareholders at which holders of CBS Preferred Stock are voting as a separate class or series, or any adjournment or postponement thereof, held to consider such adoption, provided that the grant of the aforesaid proxy by Gaylord shall be expressly conditioned upon (i) Section 5 of Article IV of the Viacom Certificate remaining in the form attached hereto and (ii) CBS not having breached either of the covenants set forth in clauses (i) and (ii) of the second sentence of Section 5.13(a). THIS PROXY AND POWER OF ATTORNEY IS IRREVOCABLE AND COUPLED WITH AN INTEREST. Gaylord hereby acknowledges that it has reviewed a copy of the Viacom Merger Agreement, as in effect on the date hereof. Section 5.14 Registration Statement (a) CBS shall prepare and, prior to the Closing, shall file with the SEC a registration statement on Form S-3 (including any amendments thereto, the "Registration Statement") with respect to the CBS Conversion Shares. The Registration Statement shall provide for the offer and sale of the CBS Conversion Shares on a delayed or continuous basis. CBS shall use its best efforts to cause the Registration Statement to become effective as soon as reasonably practicable after the Effective Time and remain effective until the earliest to occur of (i) two years after the Effective Time, (ii) such time as all shares covered by the Registration Statement have been sold and (iii) the effective time of the Merger (as defined in the Viacom Merger Agreement). (b) CBS shall pay all costs, expenses and fees related to the Registration Statement, including all registration and filing fees, printing expenses, fees and disbursements of CBS's counsel and its independent certified accountants, blue sky fees and expenses, and fees and disbursements of Gaylord's counsel and, if CBS requests Gaylord to effect an underwritten public offering of any of the shares covered by the Registration Statement, all road show and other marketing expenses incurred by CBS or any underwriters which are not otherwise paid by such underwriters. Gaylord shall pay any selling expenses, including, if applicable, all underwriting discounts and selling commissions, and, if Gaylord elects to effect an underwritten public offering of any of the shares covered by the Registration Statement, all road show and other marketing expenses incurred by CBS or any underwriters which are not otherwise paid by such underwriters. (c) Gaylord shall promptly upon request furnish to CBS or its counsel such information concerning Gaylord as may be required for inclusion in the Registration Statement or the prospectus (including any supplements thereto, the "Prospectus") that forms a part of the Registration Statement, including information concerning Gaylord's beneficial ownership of CBS Common Stock and Gaylord's intended plan of distribution for the shares covered by the Registration Statement. (a) CBS shall furnish to Gaylord, prior to the filing thereof, a copy of the Registration Statement, each amendment thereof and each amendment or supplement, if any, to the Prospectus and shall use its best efforts to reflect in each such document, when so filed, such comments as Gaylord reasonably and timely may propose. In connection with the Registration Statement, CBS shall, as expeditiously as possible: (i) prepare and file with the SEC such amendments of and supplements to the Registration Statement and the Prospectus as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of the shares covered by the Registration Statement; (ii) furnish such number of Prospectuses and other documents incident thereto, including any supplements thereto, as Gaylord from time to time may reasonably request in order to facilitate the disposition of the shares covered by the Registration Statement; (iii) at any time when the Prospectus is required to be delivered under the Securities Act, notify Gaylord of the happening of any event as a result of which the Prospectus included in the Registration Statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact necessary in order to make the statements, in the light of the circumstances under which they were made, not misleading, and prepare and furnish to Gaylord a reasonable number of copies of a supplement to or an amendment of the Prospectus and the Registration Statement as may be necessary so that, as thereafter delivered to the purchasers of the shares, such Prospectus shall not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements, in the light of the circumstances under which they were made, not misleading; (iv) take such action as Gaylord may reasonably request to qualify the shares covered by the Registration Statement for offering and sale under the securities or blue sky laws of such jurisdictions as Gaylord may request and continue such qualifications in effect for so long as the Registration Statement is effective, provided that in connection therewith CBS shall not be required to qualify as a foreign corporation or to file a general consent to service of process in any jurisdiction; (v) otherwise use its reasonable best efforts to comply with all applicable rules and regulations of the SEC, and make available to its security holders, as soon as reasonably practicable, an earnings statement covering the period of at least twelve (12) months, beginning with the first day of CBS's first full fiscal quarter after the effective date of the Registration Statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act; (vi) in connection with any underwritten public offering of any of the shares covered by the Registration Statement, (A) enter into an underwriting agreement containing customary underwriting provisions, including mutual indemnity provisions such as those set forth in Section 5.15, and deliver or cause to be delivered such other documents as may be customary so as to effect the offer and sale of the shares covered by the Registration Statement, including "comfort letters" from CBS's independent certified accountants, (B) make available to the underwriters such information and members of management as the underwriters may reasonably request in connection with their due diligence review of the affairs of CBS and (c) participate in "road shows" and other marketing activities as the underwriters may reasonably request; and (vii) in connection with other transactions involving broker-dealers that may be deemed to be an "underwriter" within the meaning of Section 2(11) of the Securities Act, make available to such broker-dealers such information and members of management as they may reasonably request in connection with their due diligence review of the affairs of CBS and participate in "road shows" and other marketing activities as such broker-dealers may reasonably request. (e) Gaylord shall not permit any third party involved in a financing transaction with Gaylord (including any such party that may engage in hedging transactions involving CBS Common Stock) to make an offer or sale of CBS Common Stock that purports to be, or is required to be, covered by the Registration Statement, without delivering the Prospectus (as appropriately supplemented) in compliance with the delivery and disclosure requirements applicable to such a transaction. (f) CBS, upon written notice to Gaylord, may suspend the use of the Prospectus for a period or periods (each, a "Blackout Period") not to exceed forty (40) trading days in the aggregate in any twelve (12) month period if CBS determines in good faith that such a suspension is necessary to avoid public disclosures (i) which would interfere with or affect in a material adverse manner the negotiation or completion of any acquisitions or divestitures as being contemplated by CBS at the time the right to suspend is exercised or (ii) of pending corporate developments of a nature which, in accordance with applicable federal securities laws, would require public disclosure at the time of the proposed sale, provided that CBS shall use its reasonable best efforts to keep the length of any Blackout Period to the minimal time reasonably practicable under the circumstances and, in any event, no more than ten (10) consecutive trading days. (g) Gaylord may transfer or assign any of the rights or benefits granted to it by CBS under this Section 5.14 and under Section 5.15 to a pledgee under a pledge or similar agreement entered into by Gaylord or to any transferee of such a pledgee for which such pledgee has been acting as collateral agent or in a similar capacity, provided that any such pledgee or transferee shall assume the obligations, and be bound by the burdens, of Gaylord under Sections 5.14 and 5.15 as fully as if such person were a party hereto. No purchaser of any of the shares covered by the Registration Statement shall acquire or assume the benefits of any of the rights granted by CBS hereunder. Section 5.15 Indemnification and Contribution (a) CBS will indemnify Gaylord, each of its officers and directors, and each person controlling Gaylord, within the meaning of Section 15 of the Securities Act, and each broker-dealer deemed to be an "underwriter" within the meaning of Section 2(11) of the Securities Act, if any, and each person who controls within the meaning of Section 15 of the Securities Act any such broker-dealer, against all claims, losses, damages and liabilities (or actions, proceedings or settlements in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in the Registration Statement or in any Prospectus, or based on any omission (or alleged omission) to state therein a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, and will reimburse Gaylord, its officers and directors and each person controlling Gaylord, each such broker-dealer, and each person who controls any such broker-dealer, for any legal and any other expenses reasonably incurred in connection with investigating and defending or settling any such claim, loss, damage or liability (or action or proceeding in respect thereof), provided, however, that CBS will not be liable in any such case to the extent that any such claim, loss, damage, liability or expense arises out of or is based on any untrue statement (or alleged untrue statement) or omission (or alleged omission) based upon written information furnished to CBS by Gaylord, any such broker-dealer or any person controlling Gaylord or any such broker-dealer and stated to be specifically for use therein; provided further, however, that CBS will not be liable under this Section 5.15 for any such claim, loss, damage, liability (or action, proceeding or settlement in respect thereof) or expense that arises out of Gaylord's or any other person's failure to send or give a copy of the final Prospectus to the person asserting an untrue statement (or alleged untrue statement) or omission (or alleged omission) at or prior to the written confirmation of the sale of any shares covered by the Registration Statement to such person if such statement or omission was corrected in such final Prospectus and CBS or its counsel has previously furnished copies thereof to Gaylord or such other person in accordance with this Agreement. It is agreed that the indemnity agreement contained in this Section 5.15 shall not apply to amounts paid in settlement of any such loss, claim, damage or liability (or action or proceeding in respect thereof), if such settlement is effected without the consent of CBS (which consent shall not be unreasonably withheld). (b) Gaylord will (and will cause any transferee permitted under Section 5.14(g) to) indemnify CBS, each of its directors and officers, and each broker-dealer deemed to be an "underwriter" within the meaning of Section 2(11) of the Securities Act, if any, and each person who controls CBS or such broker-dealer within the meaning of Section 15 of the Securities Act, against all claims, losses, damages and liabilities (or actions, proceedings or settlements in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement) of a material fact contained in the Registration Statement or in any Prospectus or any omission (or alleged omission) to state therein a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, and will reimburse CBS and such directors, officers, broker-dealers, or controlling person for any legal and any other expenses reasonably incurred in connection with investigating and defending or settling any such claim, loss, damage or liability (or action or proceeding in respect thereof), provided, however, that Gaylord will not be liable in any such case to the extent that any such expense, claim, loss, damage or liability arises out of or is based on any untrue statement (or alleged untrue statement) or omission (or alleged omission), based upon written information furnished to Gaylord by CBS or any person controlling CBS and stated to be specifically for use therein. It is agreed that the obligations of Gaylord hereunder shall not apply to amounts paid in settlement of any such claims, losses, damages or liabilities (or action or proceeding in respect thereof), if such settlement is effected without the consent of Gaylord (which consent shall not be unreasonably withheld). (c) Each party entitled to indemnification under this Section (the "Indemnified Party") shall give notice to the party or parties required to provide indemnification (the "Indemnifying Party") promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may be sought, and shall permit the Indemnifying Party to assume the defense of such claim or any litigation resulting therefrom, and the Indemnified Party may participate in such defense at such party's expense, and provided further that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Section, to the extent such failure is not prejudicial to the Indemnifying Party. No Indemnifying Party, in the defense of any such claim or litigation, shall, except with the consent of each Indemnified Party, consent to entry of any judgment or enter into any settlement that does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in respect to such claim or litigation. Each Indemnified Party shall furnish such information regarding itself or the claim in question as an Indemnifying Party or its counsel may reasonably request in writing and as shall be reasonably required in connection with the defense of such claim and litigation resulting therefrom. (d) If the indemnification provided for in this Section is held by a court of competent jurisdiction to be unavailable to an Indemnified Party with respect to any claim, loss, damage, liability or expense referred to therein, then the Indemnifying Party, in lieu of indemnifying such Indemnified Party hereunder, shall contribute to the amount paid or payable by such Indemnified Party as a result of such claim, loss, damage, liability or expense in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the Indemnified Party on the other in connection with the statements or omissions that resulted in such claim, loss, damage, liability or expense as well as any other relevant equitable considerations. The relative fault of the Indemnifying Party and of the Indemnified Party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Indemnifying Party or by the Indemnified Party and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. Section 5.16 Procedure for Sale of CBS Conversion Shares (a) If, on or prior to the first anniversary of the Effective Time, Gaylord elects to sell any of the CBS Conversion Shares while the Registration Statement is effective, Gaylord shall promptly provide CBS with written notice thereof (a "Notice of Intended Sale") setting forth the number of CBS Conversion Shares proposed to be sold. If CBS determines pursuant to Section 5.14(f) to impose a Blackout Period, it may do so upon written notice (a "Blackout Notice") to Gaylord no later than the close of business (New York City time) on the trading day immediately following the day of delivery of the Notice of Intended Sale, it being understood that the foregoing shall not limit CBS' ability to exercise its rights under Section 5.14(f) prior to the consummation of the proposed sale specified in the Notice of Intended Sale by delivery of a Blackout Notice. If CBS delivers a Blackout Notice, CBS covenants that it shall provide written notice to Gaylord (a "Resumption Notice") no later than the close of business (New York City time) on the trading day immediately following the day on which CBS determines in good faith that Gaylord can resume use of the Prospectus. (b) If, on or prior to the first anniversary of the Effective Time, (i) a Blackout Period continues for more than ten consecutive (10) trading days (measured beginning on the date of delivery of a Blackout Notice following delivery of a Notice of Intended Sale and ending on, and including, the date of delivery of a Resumption Notice); or (ii) if the aggregate number of trading days in any one Blackout Period following delivery of a Notice of Intended Sale or in all Blackout Periods following delivery of related Notices of Intended Sale exceeds forty (40); then CBS shall promptly pay to Gaylord in cash an amount equal to the total number of CBS Conversion Shares sold multiplied by the excess, if any, of (A) in the case of clause (i), the lower of (1) the closing price per share of CBS Common Stock as reported on the NYSE Composite Transactions Tape (as reported by the Wall Street Journal or, if not reported thereby, by another authoritative source mutually selected by Gaylord and CBS) on the date of the delivery of the relevant Blackout Notice and (2) the "Market Price" (as defined in Section 1.9 above), and, in the case of clause (ii), the Market Price, over (B) the higher of (1) the closing price per share of CBS Common Stock as reported on the NYSE Composite Transactions Tape (as reported by the Wall Street Journal or, if not reported thereby, by another authoritative source mutually selected by Gaylord and CBS) on the trading day immediately following the last day of the relevant Blackout Period (which, in the case of clause (ii), shall be the first Blackout Period that results in the aggregate number of trading days exceeding forty (40)) and (2) the actual sale price per share of CBS Common Stock received by Gaylord minus the applicable per share selling discount or commission; provided, however, that (I) the aggregate amount of the obligation of CBS under clause (i) of this Section 5.16(b) (but not under clause (ii)), shall not exceed Seven Million Dollars ($7,000,000); (II) Gaylord shall only be entitled to the payment from CBS under this Section 5.16 as to CBS Conversion Shares sold by Gaylord within one (1) year following receipt of the relevant Resumption Notice (which, in the case of clause (ii), shall be the Resumption Notice delivered at the end of the Blackout Period that results in the aggregate number of trading days exceeding forty (40)); and (iii) Gaylord shall only be entitled to the payment from CBS under this Section 5.16 as to no more than the number of CBS Conversion Shares specified in the relevant Notice of Intended Sale. Any payments made under clause (i) shall be credited to any payments due under clause (ii). Gaylord acknowledges that the indemnification to which it may be entitled under this Section 5.16(b) is its sole and exclusive remedy if a Blackout Period continues for more than ten (10) consecutive trading days at one time or if the aggregate number of trading days in any one Blackout Period or in all Blackout Periods exceeds forty (40). If CBS Conversion Shares are sold in circumstances that would require the application of this paragraph (b) at more than one price, the formula provided in this paragraph (b) shall be applied independently to each such sale. SECTION 1.12 Section 6.5 of the Merger Agreement is hereby deleted and replaced with the following: The CBS Conversion Shares shall have been approved for listing on the NYSE, subject to official notice of issuance. SECTION 1.13 Section 7.4 of the Merger Agreement is hereby deleted and replaced with the following: Section 7.4 Intentionally Omitted SECTION 1.14 Section 7.5 of the Merger Agreement is hereby deleted and replaced with the following: The CBS Conversion Shares shall have been approved for listing on the NYSE, subject to official notice of issuance. SECTION 1.15 Section 7.6 of the Merger Agreement is hereby deleted and replaced with the following: The Executive Vice President and Chief Financial Officer or the Executive Vice President and General Counsel of CBS shall have delivered a duly executed certificate reaffirming the accuracy of the matters described in Sections 4.1 and 4.2 of the Amended and Restated Tax Matters Agreement as of the Closing Date. SECTION 1.16 The following Sections are hereby added to Section 7 of the Merger Agreement: Section 7.10 CBS shall have duly filed a Statement With Respect to Shares in the form of Exhibit A attached hereto as an amendment to its Restated Articles of Incorporation with the Secretary of State of the Commonwealth of Pennsylvania. Section 7.11 CBS shall have filed a registration statement on Form S-3 as contemplated by Section 5.14(a). Section 7.12 CBS shall have executed and delivered the Amended and Restated Tax Matters Agreement. SECTION 1.17 Schedule 5.2(e)(iii) is hereby deleted in its entirety. SECTION 1.18 Section 10.4 of the Merger Agreement is hereby deleted and replaced with the following: All notices or other communications required or permitted hereunder shall be in writing and shall be deemed given or delivered when delivered personally, by messenger, by private courier, or by facsimile transmission, or seventy-two (72) hours after having been sent by registered or certified mail addressed as follows: If to CBS, to: CBS Corporation 51 West 52nd Street New York, NY 10019 Attention: Louis J. Briskman, Esq. Facsimile No.: 212 597-4031 with a copy to: Cravath, Swaine & Moore 825 Eighth Avenue New York, NY 10019 Attention: Peter S. Wilson, Esq. Facsimile No.: 212-765-0978 If to Gaylord, to: Gaylord Entertainment Company One Gaylord Drive Nashville, Tennessee 37214 Attention: Joseph B. Crace Facsimile No: 615-316-6570 with a copy to: Sherrard & Roe, PLC 424 Church Street, Suite 2000 Nashville, TN 37219 Attention: Thomas J. Sherrard, Esq. Facsimile No.: 615-742-4539 with a copy to: Reed Smith Shaw & McClay 1301 K Street, N.W. East Tower - Suite I 100 Washington, D.C. 20005 Attention: Brian A. Johnson, Esq. Facsimile No.: 202-414-9299 or to such other address or facsimile number as such party may indicate by a notice delivered to the other parties hereto. SECTION 1.19 The Merger Agreement is hereby amended to add Exhibit A and Schedule 5.13 hereto as Exhibit A and Schedule 5.13, respectively, to the Merger Agreement. SECTION 1.20 CBS hereby waives Section 6.6 of the Merger Agreement solely with respect to Gaylord's obligations under Section 5.6 of the Merger Agreement regarding the Crescent Real Estate lease. The foregoing waiver shall not apply to any other obligation of Gaylord or the Gaylord Subsidiaries under the Merger Agreement. Gaylord covenants that it shall, as promptly as reasonably practicable, cause the lessor under the Crescent Real Estate lease, or an alternative lessor, to enter into a replacement of the Crescent Real Estate lease on terms not materially more disadvantageous to CBS, GTC, GCI and the Limited Partnership than those contained in the Crescent Real Estate lease. SECTION 1.21 The following is hereby added to Section 1.13 of the Merger Agreement as paragraph (f): (f) Gaylord hereby represents that it has caused the Limited Partnership to execute the letter agreement dated August 24, 1999 from Paramount Pictures Corporation ("Paramount") to the Station (the "Paramount Letter"). Gaylord hereby assumes the obligations to pay the balance of the total license fee obligation described in the Paramount Letter. In exchange therefor, CBS shall make a payment to Gaylord in the amount of $10,000, as reflected on the estimated balance sheet delivered pursuant to Section 1.13(d). Gaylord and CBS each covenant to use their reasonable efforts to cause Paramount to execute the Paramount Letter as promptly as reasonably practicable. Upon execution of the Paramount Letter by Paramount, notwithstanding Section 1.13(e), CBS shall have no obligation to pay Gaylord any revenues with respect to the agreement that is the subject of the Paramount Letter. If the parties are unable to cause Paramount to execute the Paramount Letter within sixty (60) days, Gaylord shall pay CBS $10,000, and the agreement that is the subject of the Paramount Letter shall be governed by the provisions of Section 1.13(e). Upon execution of the Paramount Letter by the parties thereto, CBS shall have no obligation under the agreement that is the subject of the Paramount Letter, and Gaylord shall hold CBS harmless from and against any such obligation or other liability under such Agreement. ARTICLE II GENERAL SECTION 2.1 Merger Agreement. Except as amended hereby, the provisions of the Merger Agreement shall remain in full force and effect. References in the Merger Agreement and the other Transaction Agreements shall be references to the Merger Agreement as amended by this First Amendment. SECTION 2.2 Governing Law. This First Amendment shall be governed by and construed in accordance with the laws of the State of Delaware without reference to its choice of law rules. SECTION 2.3 Execution in Counterparts. This First Amendment may be executed in one or more counterparts, each of which shall be considered an original instrument, but all of which shall be considered one and the same agreement, and shall become binding when one or more counterparts have been signed by each of the parties and delivered to each of the parties. IN WITNESS WHEREOF, Gaylord, GTC, GCI, CBS, CBS Dallas Ventures and CBS Dallas Media have caused this First Amendment to be signed by their respective officers thereunto duly authorized as of the date first written above. GAYLORD ENTERTAINMENT COMPANY By: /s/ Joseph B. Crace --------------------------- Name: Joseph B. Crace Title: GAYLORD TELEVISION COMPANY By: /s/ Joseph B. Crace --------------------------- Name: Joseph B. Crace Title: GAYLORD COMMUNICATIONS, INC. By: /s/ Joseph B. Crace --------------------------- Name: Joseph B. Crace Title: CBS CORPORATION By: /s/ Fredric G. Reynolds --------------------------- Name: Fredric G. Reynolds Title: CBS DALLAS VENTURES, INC. By: /s/ Fredric G. Reynolds --------------------------- Name: Fredric G. Reynolds Title: CBS DALLAS MEDIA, INC. By: /s/ Fredric G. Reynolds --------------------------- Name: Fredric G. Reynolds Title: The Limited Partnership joins in the execution of this First Amendment and agrees to be bound hereby and specifically acknowledges the terms of, and agrees to be bound by, the terms of Section 1.10 of the Agreement, as amended by this First Amendment. GAYLORD BROADCASTING COMPANY, L.P. By: Gaylord Communications, Inc., its general partner By: /s/ Joseph B. Crace ------------------------ Its: ------------------------ Amendment to Schedule 2.16 (omitted) EXHIBIT A CBS CORPORATION RESOLUTION ESTABLISHING THE SERIES B PARTICIPATING PREFERRED STOCK(1) RESOLVED, that a series of Preferred Stock of the Company, the Series B Participating Preferred Stock, is hereby created out of the authorized but unissued shares of Preferred Stock of the Company undesignated as to series, with the terms and provisions herein set forth, which terms and provisions shall be made a part of the Company's Restated Articles of Incorporation as Article FIFTH (F) thereof: F. 1. DESIGNATION AND AMOUNT. The shares of this series shall be designated as "Series B Participating Preferred Stock" (the "Series B Preferred Stock"). The par value of each share of Series B Preferred Stock shall be $1.00. The number of shares constituting the Series B Preferred Stock shall initially be 10,150. The Company is authorized to issue fractional shares of Series B Preferred Stock to 1/1000th of a share in accordance with the terms herein. All references herein to shares of Series B Preferred Stock shall be deemed to include, if applicable, references to such fractional shares. 2. DIVIDENDS AND DISTRIBUTIONS. (a) Subject to the provisions for adjustment hereinafter set forth, the holders of outstanding shares of Series B Preferred Stock shall be entitled to receive, when, as and if declared by the Board of Directors out of funds legally available for the purpose, a cash dividend in an amount per share (rounded to the nearest cent) equal to 1000 times the aggregate per share amount of each cash dividend declared or paid on the Common Stock, $1.00 par value per share, of the Company (the "Common Stock"). In addition, in the event the Company shall, at any time after the issuance of any share or fraction of a share of Series B Preferred Stock, pay any dividend or make any distribution on the shares of Common Stock of the Company, whether by way of a dividend or a reclassification of stock, a recapitalization, reorganization or partial liquidation of the Company or otherwise, which is payable in cash or any debt security, debt instrument, real or personal property or any other property (other than (x) cash dividends subject to the -------------------- 1 To be attached to Statement With Respect To Shares. 2 immediately preceding sentence, (y) a distribution of shares of Common Stock or other capital stock of the Company subject to paragraph 8(a) below or (z) a distribution of rights or warrants to acquire any such shares subject to paragraph 8(b) or (c) below, including as such a right any debt security convertible into or exchangeable for any such shares, at a price less than the Fair Market Value (as hereinafter defined) of such shares on the date of issuance of such rights or warrants), then, and in each such event, the Company shall simultaneously pay on each then outstanding share of Series B Preferred Stock a distribution, in like kind, of 1000 times such distribution paid on a share of Common Stock (subject to the provisions for adjustment hereinafter set forth). The dividends and distributions on the Series B Preferred Stock to which holders thereof are entitled pursuant to the first and second sentences of this paragraph 2(a) are hereinafter referred to as "Dividends" and the multiple of such cash and non-cash dividends and distributions on the Common Stock applicable to the determination of the Dividends, which shall be 1000 initially but shall be adjusted from time to time as hereinafter provided, is hereinafter referred to as the "Dividend Multiple." In the event the Company shall, at any time after the issuance of any share or fraction of a share of Series B Preferred Stock, declare or pay any dividend or make any distribution on Common Stock payable in shares of Common Stock, or effect a subdivision or split or a combination, consolidation or reverse split of the outstanding shares of Common Stock into a greater or lesser number of shares of Common Stock, then in each such case the Dividend Multiple thereafter applicable to the determination of the amount of Dividends which holders of shares of Series B Preferred Stock shall be entitled to receive shall be the Dividend Multiple applicable immediately prior to such event multiplied by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. (b) The Company shall declare each Dividend at the same time it declares any cash or non-cash dividend or distribution on the Common Stock in respect of which a Dividend is required to be paid. No cash or non-cash dividend or distribution on the Common Stock in respect of which a Dividend is required to be paid shall be paid or set aside for payment on the Common Stock unless a Dividend in respect of such dividend or distribution on the Common Stock shall be simultaneously paid, or set aside for payment, on the Series B Preferred Stock. 3 (c) All Dividends paid with respect to shares of the Series B Preferred Stock shall be paid pro rata on a share-by-share basis to the holders entitled thereto. (d) The holders of shares of Series B Preferred Stock shall not be entitled to receive any dividends or distributions except as provided herein. 3. VOTING RIGHTS. The holders of record of outstanding shares of Series B Preferred Stock shall have the following voting rights: (a) Subject to the provisions for adjustment hereinafter set forth, each share of Series B Preferred Stock shall entitle the holder thereof to 1000 votes on all matters submitted to a vote of the holders of the Common Stock. The number of votes which a holder of a share of Series B Preferred Stock is entitled to cast, as the same may be adjusted from time to time as hereinafter provided, is hereinafter referred to as the "Vote Multiple." In the event the Company shall, at any time after the issuance of any share or fraction of a share of Series B Preferred Stock, declare or pay any dividend on Common Stock payable in shares of Common Stock, or effect a subdivision or split or a combination, consolidation or reverse split of the outstanding shares of Common Stock into a greater or lesser number of shares of Common Stock, then in each such case the Vote Multiple thereafter applicable to the determination of the number of votes per share to which holders of shares of Series B Preferred Stock shall be entitled after such event shall be the Vote Multiple applicable immediately prior to such event multiplied by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. (b) Except as otherwise provided herein, in the Restated Articles of Incorporation, in the By-laws or as otherwise provided by law, the holders of shares of Series B Preferred Stock, the holders of shares of Series A Participating Preferred Stock, par value $1.00 per share, of the Company (the "Series A Preferred Stock"), if any, and the holders of shares of Common Stock shall vote together as one class on all matters submitted to a vote of shareholders of the Company. (c) Except as otherwise required by the Restated Articles of Incorporation or the By-laws or set forth in this paragraph 3 or in paragraph 14 or as otherwise provided by law, holders of Series B Preferred Stock shall have no 4 other special voting rights and their consent shall not be required (except to the extent they are entitled to vote with holders of Common Stock as set forth herein) for the taking of any corporate action. 4. CONVERSION. The shares of Series B Preferred Stock shall be convertible as follows: (a) Each share of Series B Preferred Stock shall be convertible, at the option of the holder thereof, at any time after the date of issuance of such share at the office of the Company or any transfer agent for the Series B Preferred Stock. Subject to the provisions for adjustment hereinafter set forth, each share of Series B Preferred Stock shall be convertible into 1000 shares of Common Stock. The number of shares of Common Stock into which each share of Series B Preferred Stock may be converted is hereinafter referred to as the "Conversion Rate." In the event the Company shall, at any time after the issuance of any share or fraction of a share of Series B Preferred Stock, declare or pay any dividend on Common Stock payable in shares of Common Stock, or effect a subdivision or split or a combination, consolidation or reverse split of the outstanding shares of Common Stock into a greater or lesser number of shares of Common Stock, then in each such case the Conversion Rate thereafter applicable shall be the Conversion Rate applicable immediately prior to such event multiplied by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. (b) If the Merger Agreement (as hereinafter defined) is terminated in accordance with its terms, all outstanding shares of Series B Preferred Stock shall, at the option of the Company, be mandatorily converted into shares of Common Stock at the Conversion Rate applicable immediately prior to such termination. (c) No fractional shares of Common Stock shall be issued upon conversion of the Series B Preferred Stock. In lieu of any fractional shares to which the holder would otherwise be entitled, the Company shall pay cash equal to such fraction multiplied by the then Fair Market Value per share of the Common Stock. For such purpose, all shares of Series B Preferred Stock held by each holder shall be aggregated, and any resulting fractional share of Common Stock shall be paid in cash. Before any holder of shares of Series B Preferred Stock shall be entitled to convert the same into full shares of Common Stock, and to receive 5 certificates therefor, the holder shall surrender the certificate or certificates representing the shares of Series B Preferred Stock, duly endorsed, at the office of the Company or of any transfer agent for the Series B Preferred Stock, and shall give written notice to the Company at such office that such holder elects to convert the same; provided, however, that in connection with a conversion pursuant to paragraph 4(b) above, the conversion shall be deemed effective immediately upon the Company's election thereunder. The Company shall, as soon as practicable after such delivery, issue and deliver at such office to such holder of Series B Preferred Stock a certificate or certificates for the number of shares of Common Stock to which such holder shall be entitled and a check payable to such holder in the amount of any cash amount payable as the result of a conversion into fractional shares of Common Stock, plus any declared and unpaid dividends on the converted Series B Preferred Stock. Subject to the proviso in the last sentence of the immediately preceding paragraph, such conversion shall be deemed to have been made immediately prior to the close of business on the date of receipt of such surrender of the shares of Series B Preferred Stock to be converted, and the person or persons entitled to receive the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder or holders of such shares of Common Stock on such date. (d) The Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of Series B Preferred Stock, such number of shares of Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding shares of Series B Preferred Stock. (e) Any notice required by the provisions of this Section 4 to be given to the holders of shares of Series B Preferred Stock or to the Company shall be given via facsimile transmission or via certified or registered U.S. mail or via private overnight delivery service, if to the holder, at (615) 316-6570 or such holder's address appearing on the books of the Company, and if to the Company, at (212) 597-4031 or 51 West 52nd Street, New York, NY 10019, attention General Counsel, or such other facsimile number or address as the holder or the Company shall notify the other of in accordance with the notice provisions set forth in this paragraph 4(e). Notice shall be deemed to have been given on the date of facsimile transmission (if the notice 6 is faxed) or five days after mailing (if the notice is mailed) or the day after the notice is given to the delivery service (if sent by overnight courier). 5. CERTAIN RESTRICTIONS. (a) Whenever Dividends are in arrears or the Company shall be in default on payment thereof, thereafter and until all accrued and unpaid Dividends, whether or not declared, on shares of Series B Preferred Stock outstanding shall have been paid or set irrevocably aside for payment in full, and in addition to any and all other rights which any holder of shares of Series B Preferred Stock may have in such circumstances, the Company shall not: (i) declare or pay dividends on, make any other distributions on, or redeem or purchase or otherwise acquire for consideration, any shares of stock ranking junior (either as to dividends or upon liquidation, dissolution or winding up) to the Series B Preferred Stock; (ii) declare or pay dividends on or make any other distributions on any shares of stock ranking on a parity as to dividends with the Series B Preferred Stock, unless dividends are paid ratably on the Series B Preferred Stock and all such parity stock on which dividends are payable or in arrears in proportion to the total amounts to which the holders of all such shares are then entitled if the full dividends accrued thereon were to be paid; (iii) except as permitted by subparagraph (iv) of this paragraph 5(a), redeem or purchase or otherwise acquire for consideration shares of any stock ranking on a parity (either as to dividends or upon liquidation, dissolution or winding up) with the Series B Preferred Stock, provided that the Company may at any time redeem, purchase or otherwise acquire shares of any such parity stock in exchange for shares of any stock of the Company ranking junior (both as to dividends and upon liquidation, dissolution or winding up) to the Series B Preferred Stock; or (iv) purchase or otherwise acquire for consideration any shares of Series B Preferred Stock, or any shares of stock ranking on a parity with the Series B Preferred Stock (either as to dividends or upon liquidation, dissolution or winding up) except as permitted by subparagraph (iii) of this paragraph 5(a) or in accordance with a purchase offer made to all 7 holders of such shares upon such terms as the Board of Directors, after consideration of the respective annual dividend rates and other relative rights and preferences of the respective series and classes, shall determine in good faith will result in fair and equitable treatment among the respective series or classes. (b) The Company shall not permit any Subsidiary (as hereinafter defined) of the Company to purchase or otherwise acquire for consideration any shares of stock of the Company unless the Company could, under subparagraph (a) of this paragraph 5, purchase or otherwise acquire such shares at such time and in such manner. A "Subsidiary" of the Company shall mean any corporation or other entity of which securities or other ownership interests entitled to cast at least a majority of the votes that would be entitled to be cast in an election of the board of directors of such corporation or other entity or other persons performing similar functions are beneficially owned, directly or indirectly, by the Company or by any corporation or other entity that is otherwise controlled by the Company. (c) The Company shall not issue any shares of Series B Preferred Stock except pursuant to the Agreement and Plan of Merger dated as of April 9, 1999, as it may be amended from time to time, among Gaylord Entertainment Company, Gaylord Television Company, Gaylord Communications, Inc., the Company, CBS Dallas Ventures, Inc. and CBS Dallas Media, Inc., a copy of which is on file with the Secretary of the Company at its principal executive offices and shall be made available to holders of Series B Preferred Stock without charge upon written request therefor addressed to the Secretary of the Company at the address set forth in paragraph 4(e) above. Notwithstanding the foregoing sentence, nothing contained in the provisions of this Article FIFTH (F) shall prohibit or restrict the Company from issuing for any purpose any series of Preferred Stock with rights and privileges similar to, different from, or greater than, those of the Series B Preferred Stock or, subject to the limitations set forth in paragraph 14, from creating other securities senior to, junior to or on a parity with the Series B Preferred Stock. 6. REACQUIRED SHARES. Any shares of Series B Preferred Stock purchased or otherwise acquired by the Company in any manner whatsoever shall be retired and canceled promptly after the acquisition thereof. All such shares upon their retirement and cancelation shall become authorized but unissued shares of Preferred Stock, without designation as to series, and such shares may be 8 redesignated and reissued as part of any series of Preferred Stock. 7. LIQUIDATION, DISSOLUTION OR WINDING UP; FAIR VALUE FOR PURPOSES OF PENNSYLVANIA ANTI-TAKEOVER STATUTE. (a) Upon any voluntary or involuntary liquidation, dissolution or winding up of the Company, no distribution shall be made (i) to the holders of shares of stock ranking junior (upon liquidation, dissolution or winding up) to the Series B Preferred Stock unless the holders of shares of Series B Preferred Stock outstanding shall have received out of the assets of the Company available for distribution to its shareholders after payment or provision for payment of any securities ranking senior to the Series B Preferred Stock, for each share of Series B Preferred Stock, subject to adjustment as hereinafter provided, (A) $1.00 plus an amount equal to accrued and unpaid dividends and distributions thereon, whether or not declared, to the date of such payment or, (B) if greater than the amount specified in clause (i)(A) of this sentence, an amount equal to 1000 times the aggregate amount to be distributed per share to holders of Common Stock, as the same may be adjusted as hereinafter provided, and (ii) to the holders of stock ranking on a parity upon liquidation, dissolution or winding up with the Series B Preferred Stock, unless simultaneously therewith distributions are made ratably on the Series B Preferred Stock and all other shares of such parity stock in proportion to the total amounts to which the holders of shares of Series B Preferred Stock are entitled under clause (i)(A) of this sentence and to which the holders of such parity shares are entitled, in each case upon such liquidation, dissolution or winding up. The amount to which holders of Series B Preferred Stock may be entitled upon liquidation, dissolution or winding up of the Company pursuant to clause (i)(B) of the foregoing sentence is hereinafter referred to as the "Participation Liquidation Amount" and the multiple of the amount to be distributed to holders of shares of Common Stock upon the liquidation, dissolution or winding up of the Company applicable pursuant to said clause to the determination of the Participating Liquidation Amount, as said multiple may be adjusted from time to time as hereinafter provided, is hereinafter referred to as the "Liquidation Multiple". In the event the Company shall, at any time after the issuance of any share or fraction of a share of Series B Preferred Stock, declare or pay any dividend on Common Stock payable in shares of Common Stock, or effect a subdivision or split or a combination, consolidation or reverse split of the outstanding shares of Common Stock into a greater or lesser number of shares of Common Stock, then in each such case the 9 Liquidation Multiple thereafter applicable to the determination of the Participating Liquidation Amount to which holders of Series B Preferred Stock shall be entitled after such event shall be the Liquidation Multiple applicable immediately prior to such event multiplied by a fraction the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock that were outstanding immediately prior to such event. Except as provided in this paragraph 7(a), holders of Series B Preferred Stock shall not be entitled to any distribution in the event of liquidation, dissolution or winding up of the Company. (b) For the purposes of this paragraph 7, none of the following shall be deemed to be a voluntary or involuntary liquidation, dissolution or winding up of the Company: (i) the voluntary sale, conveyance, lease, exchange or transfer (for cash, shares of stock, securities or other consideration) of all or substantially all of the property or assets of the Company; (ii) the consolidation or merger of the Company with or into one or more other corporations or other associations; (iii) the consolidation or merger of one or more corporations or other associations with or into the Company; (iv) the participation by the Company in a share exchange; (v) the division of the Company pursuant to Sections 1951 through 1957 of the Pennsylvania Business Corporation Law (the "Pennsylvania BCL"); or (vi) the conversion of the Company pursuant to Sections 1961 through 1966 of the Pennsylvania BCL. (c) Notwithstanding anything to the contrary in this Article FIFTH (F), in case any Controlling Person or Group (as defined from time to time in Section 2543 of the Pennsylvania BCL) shall be required to purchase any shares of Series B Preferred Stock pursuant to Sections 2541 through 2548 of the Pennsylvania BCL, as in effect from time to time, the amount that is determined to represent the "fair value" (as that term is used in Section 2542 of the 10 Pennsylvania BCL) of such shares shall be an amount per share equal to the Liquidation Multiple then in effect times the aggregate amount per share that such Controlling Person or Group is required to pay to purchase any share of Common Stock pursuant to such Sections 2541 through 2548 of the Pennsylvania BCL. 8. CERTAIN RECLASSIFICATIONS AND OTHER EVENTS. (a) In the event that holders of shares of Common Stock receive, after the issuance of any share or fraction of a share of Series B Preferred Stock, in respect of their shares of Common Stock any share of capital stock of the Company (other than any share of Common Stock), whether by way of reclassification, recapitalization, reorganization, dividend or other distribution or otherwise (a "Transaction"), then, and in each such event, the dividend rights, voting rights, conversion rights and rights upon the liquidation, dissolution or winding up of the Company of the shares of Series B Preferred Stock shall be adjusted so that after such Transaction the holders of Series B Preferred Stock shall be entitled, in respect of each share of Series B Preferred Stock held, in addition to such rights in respect thereof to which such holder was entitled immediately prior to such adjustment, (i) to such additional dividends as equal the Dividend Multiple in effect immediately prior to such Transaction multiplied by the additional dividends which the holder of a share of Common Stock shall be entitled to receive by virtue of the receipt in the Transaction of such capital stock, (ii) to such additional voting rights as equal the Vote Multiple in effect immediately prior to such Transaction multiplied by the additional voting rights to which the holder of a share of Common Stock shall be entitled by virtue of the receipt in the Transaction of such capital stock, (iii) upon surrender of shares of Series B Preferred Stock for conversion, to the aggregate number and kind of shares of capital stock of the Company which, if such shares of Series B Preferred Stock had been converted immediately prior to such Transaction, such holder would have been entitled to receive by virtue of such Transaction and (iv) to such additional distributions upon liquidation, dissolution or winding up of the Company as equal the Liquidation Multiple in effect immediately prior to such Transaction multiplied by the additional amount which the holder of a share of Common Stock shall be entitled to receive upon liquidation, dissolution or winding up of the Company by virtue of the receipt in the Transaction of such capital stock, as the case may be, all as provided by the terms of such capital stock. 11 (b) In the event that holders of shares of Common Stock receive, after the issuance of any share or fraction of a share of Series B Preferred Stock, in respect of their shares of Common Stock any right or warrant to purchase Common Stock (including as such a right, for all purposes of this paragraph 8(b), any security convertible into or exchangeable for Common Stock) at a purchase price per share less than the Fair Market Value of a share of Common Stock on the date of issuance of such right or warrant, then and in each such event the dividend rights, voting rights, conversion rights and rights upon the liquidation, dissolution or winding up of the Company of the shares of Series B Preferred Stock shall each be adjusted so that after such event the Dividend Multiple, the Vote Multiple, the Conversion Rate and the Liquidation Multiple shall each be the product of the Dividend Multiple, the Vote Multiple, the Conversion Rate and the Liquidation Multiple, as the case may be, in effect immediately prior to such event multiplied by a fraction the numerator of which shall be the number of shares of Common Stock outstanding immediately before such issuance of rights or warrants plus the maximum number of shares of Common Stock which could be acquired upon exercise in full of all such rights or warrants and the denominator of which shall be the number of shares of Common Stock outstanding immediately before such issuance of rights or warrants plus the number of shares of Common Stock which could be purchased, at the Fair Market Value of the Common Stock at the time of such issuance, by the maximum aggregate consideration payable upon exercise in full of all such rights or warrants. (c) In the event that holders of shares of Common Stock of the Company receive, after the issuance of any share or fraction of a share of Series B Preferred Stock, in respect of their shares of Common Stock any right or warrant to purchase capital stock of the Company (other than shares of Common Stock), including as such a right, for all purposes of this paragraph 8(c), any security convertible into or exchangeable for capital stock of the Company (other than Common Stock) but excluding, for all purposes of this paragraph 8(c), any rights issuable under the Company's Rights Agreement dated as of December 28, 1995, with First Chicago Trust Company of New York, as it may be amended from time to time, at a purchase price per share less than the Fair Market Value of a share of such capital stock on the date of issuance of such right or warrant, then and in each such event the dividend rights, voting rights, conversion rights and rights upon liquidation, dissolution or winding up of the Company of the shares of Series B Preferred Stock shall each be adjusted so that after such event each holder of a share of Series B Preferred Stock shall be entitled, in 12 respect of each share of Series B Preferred Stock held, in addition to such rights in respect thereof to which such holder was entitled immediately prior to such event, to receive (i) such additional dividends as equal the Dividend Multiple in effect immediately prior to such event multiplied, first, by the additional dividends to which the holder of a share of Common Stock shall be entitled upon exercise of such right or warrant by virtue of the capital stock which could be acquired upon such exercise, and multiplied again by the Discount Fraction (as hereinafter defined), (ii) such additional voting rights as equal the Vote Multiple in effect immediately prior to such event multiplied, first, by the additional voting rights to which the holder of a share of Common Stock shall be entitled upon exercise of such right or warrant by virtue of the capital stock which could be acquired upon such exercise, and multiplied again by the Discount Fraction, (iii) such additional conversion rights as equal the Conversion Rate in effect immediately prior to such event multiplied by a fraction the numerator of which shall be the Fair Market Value per share of Common Stock on the date of such event less the Fair Market Value of the portion of the right or warrant so distributed applicable to one share of Common Stock and the denominator of which shall be the Fair Market Value per share of Common Stock on the date of such event and (iv) such additional distributions upon liquidation, dissolution or winding up of the Company as equal the Liquidation Multiple in effect immediately prior to such event multiplied, first, by the additional amount which the holder of a share of Common Stock shall be entitled to receive upon liquidation, dissolution or winding up of the Company upon exercise of such right or warrant by virtue of the capital stock which could be acquired upon such exercise, and multiplied again by the Discount Fraction. For purposes of this paragraph, the "Discount Fraction" shall be a fraction the numerator of which shall be the difference between the Fair Market Value of a share of the capital stock subject to a right or warrant distributed to holders of shares of Common Stock of the Company as contemplated by this paragraph 8(c) immediately after the distribution thereof and the purchase price per share for such share of capital stock pursuant to such right or warrant and the denominator of which shall be the Fair Market Value of a share of such capital stock immediately after the distribution of such right or warrant. (d) For purposes of this Article FIFTH (F), the "Fair Market Value" of a share of capital stock of the Company (including a share of Common Stock) on any date shall be deemed to be the average of the daily closing price per share thereof over the 15 consecutive Trading Days (as 13 hereinafter defined) immediately prior to such date; provided, however, that in the event the Fair Market Value of any such share of capital stock is determined during a period which includes any date that is within 15 Trading Days after (i) the ex-dividend date for a dividend or distribution on stock payable in shares of such stock or securities convertible into shares of such stock, or (ii) the effective date of any subdivision, split, combination, consolidation, reverse stock split or reclassification of such capital stock or division of the Company pursuant to Sections 1951 through 1957 of the Pennsylvania BCL, then, and in each such case, the Fair Market Value shall be appropriately adjusted by the Board of Directors of the Company to take into account ex-dividend or post-effective date trading. The closing price for any day shall be the last sale price, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way (in either case, as reported in the applicable transaction reporting system with respect to securities listed or admitted to trading on the New York Stock Exchange), or, if the shares are not listed or admitted to trading on the New York Stock Exchange, as reported in the applicable transaction reporting system with respect to securities listed on the principal national securities exchange on which the shares are listed or admitted to trading or, if the shares are not listed or admitted to trading on any national securities exchange, the last quoted price or, if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported by The Nasdaq Stock Market or such other system then in use, or if on any such date the shares are not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the shares selected by the Board of Directors of the Company. The term "Trading Day" shall mean a day on which the principal national securities exchange on which the shares are listed or admitted to trading is open for the transaction of business or, if the shares are not listed or admitted to trading on any national securities exchange, on which the New York Stock Exchange or such other national securities exchange as may be selected by the Board of Directors of the Company is open. If the shares are not publicly held or not so listed or traded on any day within the 15 Trading Day period applicable to the determination of Fair Market Value thereof as aforesaid, "Fair Market Value" shall mean the fair market value thereof per share as determined in good faith by the Board of Directors of the Company. In either case referred to in the foregoing sentence, the determination of Fair Market Value shall be described in a statement filed with the Secretary of the Company. 14 9. CONSOLIDATION, MERGER, ETC. In case the Company shall enter into any consolidation, merger, division, share exchange, combination, sale of all or substantially all of the Company's assets, or other transaction in which the shares of Common Stock are exchanged for or changed into other securities, cash and/or any other property, then in any such case each outstanding share of Series B Preferred Stock shall at the same time be similarly exchanged for or changed into the aggregate amount of securities, cash and/or other property (payable in like kind), as the case may be, for which or into which each share of Common Stock is changed or exchanged multiplied by the highest of the Vote Multiple, the Dividend Multiple, the Conversion Rate or the Liquidation Multiple in effect immediately prior to such event; provided, however, that no fractional share or scrip representing fractional shares of any other securities shall be issued; provided further, however, that upon consummation of the merger contemplated in the Amended and Restated Agreement and Plan of Merger dated as of October 8, 1999, as it may be amended from time to time (the "Merger Agreement"), between the Company and Viacom Inc. ("Viacom"), each outstanding share of Series B Preferred Stock shall be converted into the aggregate number of shares of Series C Preferred Stock, par value $.01 per share, of Viacom Inc. (the "Viacom Preferred Stock") into which each share of Series B Preferred Stock is convertible pursuant to the Merger Agreement, and each share of Viacom Preferred Stock shall have substantially identical preferences, limitations and special rights as the Series B Preferred Stock except that such Viacom Preferred Stock shall, subject to adjustment (i) be convertible at any time into 1,000 shares of non-voting Class B Common Stock, par value $.01 per share, of Viacom (the "Viacom Class B Stock") and (ii) possess the voting power of 100 shares of Class A Common Stock, par value $.01 per share, of Viacom. Instead of any fractional interest in a share of such other securities which would otherwise be deliverable pursuant to this paragraph 9, the Company will pay to the holder thereof an amount in cash (computed to the nearest cent) equal to the same fraction of the Fair Market Value of a share of such other security or such other amount as may be set forth in the Merger Agreement. 10. EFFECTIVE TIME OF ADJUSTMENTS. (a) Adjustments to the Series B Preferred Stock required by the provisions hereof shall be effective as of the time at which the event requiring such adjustments occurs. 15 (b) The Company shall give prompt written notice to each holder of a share of outstanding Series B Preferred Stock of the effect of any adjustment to the voting rights, dividend rights, conversion rights or rights upon liquidation, dissolution or winding up of the Company of such shares required by the provisions hereof. Notwithstanding the foregoing sentence, the failure of the Company to give such notice shall not affect the validity or the force or effect of, or the requirement for, such adjustment. 11. NO REDEMPTION. The shares of Series B Preferred Stock shall not be redeemable at the option of the Company or any holder thereof. Notwithstanding the foregoing sentence of this paragraph 11, the Company may acquire shares of Series B Preferred Stock in any other manner permitted by law, the provisions hereof or the Restated Articles of Incorporation. 12. RANKING. The Series B Preferred Stock shall rank senior to the Common Stock, pari passu with the Series A Preferred Stock (except with respect to Preferential Dividends, in which case the Series B Preferred Stock shall rank junior to the Series A Preferred Stock) and, unless otherwise provided in a Statement with Respect to Shares or an amendment to the Restated Articles of Incorporation relating to the determination of a subsequent series of Preferred Stock, the Series B Preferred Stock shall rank junior to all other series of Preferred Stock as to the payment of dividends and the distribution of assets on liquidation, dissolution or winding up. 13. LIMITATIONS. Except as may otherwise be required by law, the shares of Series B Preferred Stock shall not have any powers, preferences or relative, participating, optional or other special rights other than those specifically set forth in this Article FIFTH (F) (as such may be amended from time to time) or otherwise in the Restated Articles of Incorporation. 14. AMENDMENT. So long as any shares of the Series B Preferred Stock are outstanding, the Company shall not amend this Article FIFTH (F) or the Restated Articles of Incorporation in any manner which would alter or change the rights, preferences or limitations cf the Series B Preferred Stock so as to affect such rights, preferences or limitations in any material respect prejudicial to the holders of the Series B Preferred Stock without, in addition to any other vote of shareholders required by law, the affirmative vote of the holders of at least two-thirds of the outstanding shares of Series B Preferred Stock, voting 16 together as a single class either in writing or by resolution adopted at an annual or special meeting called for the purpose; provided, however, that the creation of another series of Preferred Stock ranking senior to or on a parity with the Series B Preferred Stock as to the payment of dividends or the distribution of assets on liquidation, dissolution or winding up shall not be deemed to be prejudicial to the holders of the Series B Preferred Stock for the purposes of this paragraph 14. EX-2.4 4 AMENDED AND RESTATED TAX MATTERS AGREEMENT AMENDED AND RESTATED TAX MATTERS AGREEMENT THIS AMENDED AND RESTATED TAX MATTERS AGREEMENT is made as of the 8th day of October, 1999, by and among GAYLORD ENTERTAINMENT COMPANY, a Delaware corporation ("Gaylord"), GAYLORD TELEVISION COMPANY, a Delaware corporation and direct wholly owned subsidiary of GAYLORD ("GTC"), GAYLORD COMMUNICATIONS, INC., a Texas corporation and a direct wholly owned subsidiary of GAYLORD ("GCI"), and CBS CORPORATION, a Pennsylvania corporation ("CBS"). WHEREAS, Gaylord, GTC, GCI and CBS entered into the Tax Matters Agreement dated April 9, 1999 (the "Original Tax Matters Agreement"), and such parties desire to amend and restate the Original Tax Matters Agreement in its entirety; WHEREAS pursuant to the AGREEMENT AND PLAN OF MERGER dated as of April 9, 1999, as amended as of October 8, 1999 (the "CBS Merger Agreement") by and among Gaylord, GTC, GCI, CBS, CBS DALLAS VENTURES, INC. ("Newco 1"), and CBS DALLAS MEDIA, INC. ("Newco 2"), both Delaware corporations and direct wholly-owned subsidiaries of CBS, Newco 1 will be merged with and into GCI (the "GCI Merger") and Newco 2 will be merged with and into GTC (the "GTC Merger," and collectively, with the GCI Merger, the "Mergers"), with GCI and GTC as the surviving corporations; WHEREAS, GAYLORD BROADCASTING COMPANY, L.P., a Texas limited partnership (the "Limited Partnership"), is engaged in the business of owning and operating television broadcast station KTVT-TV, Fort Worth/Dallas, Texas; WHEREAS, GCI is the sole general partner of the Limited Partnership, and GTC is the sole limited partner of the Limited Partnership; WHEREAS, pursuant to the Mergers, Gaylord will receive shares of CBS Preferred Stock (as defined in the CBS Merger Agreement) in exchange for all of the issued and outstanding shares of GCI common stock (the "GCI Stock") and GTC common stock (the "GTC Stock"); WHEREAS, the parties intend that for federal income tax purposes each of the Mergers qualifies as a "reorganization" within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the "Code"); WHEREAS, Gaylord is the common parent of an affiliated group of corporations (the "Gaylord Group") within the meaning of Section 1504(a) of the Code and the members of the Gaylord Group have heretofore joined in filing consolidated federal income Tax Returns; WHEREAS, CBS is the common parent of an affiliated group of corporations (the "CBS Group") within the meaning of Section 1504(a) of the Code and the members of the CBS Group have heretofore joined in filing consolidated federal income Tax Returns; WHEREAS, CBS entered into a merger agreement dated as of September 6, 1999, as amended and restated as of October 8, 1999 (as it may be further amended from time to time, the "Viacom Merger Agreement"), with VIACOM INC., a Delaware corporation ("Viacom"), pursuant to which and subject to the terms and conditions thereof, the holders of CBS Common Stock (as defined in the CBS Merger Agreement) will receive shares of Viacom Class B Common Stock (as defined in the Viacom Merger Agreement) in exchange for their CBS Common Stock upon the effective time of the Merger (as defined in the Viacom Merger Agreement, and referred to herein as the "Viacom Merger"), and the holders of CBS Preferred Stock will receive shares of Viacom Series C Preferred Stock (as defined in the Viacom Merger Agreement) in exchange for their CBS Preferred Stock upon the effective time of the Viacom Merger (the "Viacom Effective Time"); WHEREAS, Gaylord and CBS desire on behalf of themselves, their Subsidiaries and their successors to set forth their rights and obligations with respect to Taxes relating to taxable periods before and after the Closing Date; and WHEREAS, CBS and Gaylord desire to make certain representations, warranties and covenants upon which Skadden, Arps, Slate, Meagher & Flom, LLP ("SASM&F") will rely in rendering its opinion (the "Tax Opinion") as to the qualification of the Mergers as "reorganizations" within the meaning of Section 368(a) of the Code; NOW, THEREFORE, the parties hereto hereby amend and restate the Original Tax Matters Agreement in its entirety and hereby agree as follows: ARTICLE I Definitions* 1.1 "Closing Date" shall mean the last day on which, due to the Mergers, GCI and GTC could be considered members of the Gaylord Group for federal income Tax purposes. 1.2 "Dispose" (and with correlative meaning, "Disposition") shall mean pay, discharge, settle or otherwise dispose. 1.3 "Due Date" shall mean, with respect to any Tax Return or - -------------- * Additional definitions are in the preceding portion of this Agreement. Unless otherwise defined herein, all capitalized terms herein shall have the meanings ascribed thereto in the CBS Merger Agreement. payment, the date on which such Tax Return is due to be filed with or such payment is due to be made to the appropriate Tax Authority pursuant to applicable law, giving effect to any applicable extensions of the time for such filing or payment. 1.4 "Final Determination" shall mean (i) the entry of a decision of a court of competent jurisdiction at such time as an appeal may no longer be taken from such decision, (ii) the execution of a closing agreement or its equivalent between the particular taxpayer and the relevant Tax Authority, or (iii) any other final Disposition complying with the contest provisions of Article VI hereof. 1.5 "Merger Subsidiaries" shall mean Newco 1 and Newco 2. 1.6 "Payee" shall have the meaning set forth in Section 5.6. 1.7 "Payor" shall have the meaning set forth in Section 5.6. 1.8 "Person" shall mean an individual, corporation, partnership, limited liability company, joint venture, association, trust, unincorporated organization or other entity. 1.9 "Post-Closing Period" shall mean any taxable period beginning after the Closing Date. 1.10 "Post-Closing Straddle Period" shall mean with respect to a Straddle Period, that portion of such Straddle Period that begins on the day immediately following the Closing Date. 1.11 "Pre-Closing Period" shall mean any taxable period that ends on or prior to the Closing Date. 1.12 "Pre-Closing Straddle Period" shall mean with respect to a Straddle Period, that portion of such Straddle Period ending on and including the Closing Date. 1.13 "Related Person" shall mean a related person under Treasury Regulation Section 1.368-1(e)(3). 1.14 "Section" shall refer to a section of this Agreement unless otherwise indicated. 1.15 "Straddle Period" shall mean any taxable period that begins before or on and ends after the Closing Date. 1.16 "Subsidiary" shall mean, with respect to any person, any corporation or other organization, whether incorporated or unincorporated, of which (i) such person or any other subsidiary of such person is a general partner or (ii) at least 50% of the securities or other interests having by their terms ordinary voting power to elect a majority of the board of directors or others performing similar functions with respect to such corporation or other organization or at least 50% of the value of the outstanding equity is directly or indirectly owned or controlled by such person or by any one or more of its subsidiaries, or by such person and one or more of its subsidiaries. 1.17 "Tax Authority" shall mean the Internal Revenue Service and any other state, local or foreign governmental authority responsible for the administration of Taxes. 1.18 "Tax Claim" shall mean a notice of deficiency, proposed adjustment, assessment, audit, examination, suit, dispute or other claim with respect to Taxes or a Tax Return. 1.19 "Underpayment Rate" shall mean the interest rate specified under Section 6621(a)(2) of the Code. ARTICLE II Preparation and Filing of Tax Returns 2.1 Preparation and Filing of Pre-Closing Period Tax Returns. Gaylord shall prepare (or cause to be prepared) and timely file (or cause to be timely filed) all Tax Returns with respect to any Pre-Closing Period that includes GCI, GTC or the Limited Partnership (including all Tax Returns filed on a consolidated, combined or unitary basis). Gaylord shall have sole discretion as to the positions in and with respect to any Tax Return described in the preceding sentence to the extent that it relates to GCI, GTC or the Limited Partnership; provided, however, that such Tax Returns shall be prepared on a basis consistent with the past practices of GCI, GTC and the Limited Partnership. Gaylord shall deliver (or shall cause to be delivered) to CBS a pro forma set of Tax Returns for each of GCI, GTC and the Limited Partnership for the Pre-Closing Period ending on the Closing Date at least twenty business days prior to the Due Date thereof. 2.2 Preparation and Filing of Certain Straddle Period Tax Returns. CBS shall prepare (or cause to be prepared) all Straddle Period Tax Returns which include GCI or GTC or the Limited Partnership and, at least twenty business days prior to the Due Date thereof, shall deliver (or cause to be delivered) such Tax Return to Gaylord for its review and comment, together with a statement showing in reasonable detail CBS's calculation of any Taxes attributable to a Pre-Closing Straddle Period. Any Tax Return described in the preceding sentence shall be prepared on a basis consistent with the past practice of GCI, GTC and the Limited Partnership. Gaylord shall have the right to comment on such Tax Returns and any changes, modifications, additions, or deletions suggested by Gaylord shall be made to such Tax Returns to the extent they relate to a Pre-Closing Straddle Period; provided, that such changes, modifications, additions, or deletions are consistent with past practice; provided, further, that Gaylord's comments are received by CBS at least fourteen business days prior to the Due Date of the applicable Tax Return. If CBS does not accept any change, modification, addition, or deletion suggested by Gaylord to any Straddle Period Tax Return, then the provisions of Article IX shall govern the dispute. If the dispute has not been resolved prior to the Due Date for filing of the Tax Return, the Tax Return shall be filed as originally proposed by CBS, reflecting any items agreed to by the parties at such time. Gaylord shall pay (or shall cause to be paid) to CBS the amount of Taxes relating to any Pre-Closing Straddle Period based on the Tax Returns prepared by CBS. When the dispute is resolved pursuant to Article IX, a settlement payment shall be made from CBS to Gaylord in an amount equal to the excess, if any, of (i) the amounts paid by Gaylord in respect of such Taxes over (ii) the amount of Taxes for the Pre-Closing Straddle Period finally determined to be due, plus interest at the Chase Manhattan Bank prime rate in effect from the date of the original payment from Gaylord to CBS to the date on which CBS repays Gaylord pursuant to this paragraph. CBS shall not file (or cause to be filed) such Tax Returns without Gaylord's written consent, which shall not be unreasonably withheld or delayed and shall be deemed to be given in the absence of timely written objection. 2.3 Preparation and Filing of Post-Closing Period Tax Returns. CBS shall prepare (or cause to be prepared) and timely file (or cause to be timely filed) any Tax Return with respect to any of GCI, GTC or the Limited Partnership for any Post-Closing Tax Period. 2.4 Straddle Period Tax Years. To the extent permitted by law or administrative practice, the taxable year of GCI, GTC and the Limited Partnership which includes the Closing Date shall be treated as closing on (and including) the Closing Date. All Tax items of the Limited Partnership for the period ending on the Closing Date shall be included in the Gaylord Group consolidated return, and in any state or local income tax return of GTC or GCI for the taxable period ending on the Closing Date. 2.5 Section 754 Election. An election under Section 754 of the Code (and comparable provisions of state or local tax law) shall be made on the Tax Return of the Limited Partnership for its taxable year that includes or ends on the Closing Date. 2.6 Amended Returns and Claims for Refund. Without the written consent of Gaylord, none of CBS, GCI, GTC or the Limited Partnership shall amend (or cause to be amended), or file (or cause to be filed) a claim for a Tax refund with respect to, any Tax Returns for a Pre-Closing Period or which relate to tax items in a Pre-Closing Straddle Period, other than disputed items with respect to which Gaylord received payments pursuant to Section 2.2, that included Gaylord, GCI, GTC or the Limited Partnership. ARTICLE III Payment in Respect of Taxes 3.1 Payment of Taxes by Gaylord. Gaylord shall pay (or cause to be paid) in a timely manner to the appropriate Tax Authority all Taxes due with respect to Tax Returns which it is required to file pursuant to Section 2.1. For all Taxes in respect of Straddle Periods for which CBS is required to file (or cause to be filed) Tax Returns pursuant to Section 2.2, Gaylord shall pay CBS the amount of such Taxes relating to any Pre-Closing Straddle Period (as determined in accordance with Section 2.2) at least five business days prior to the Due Date of the Tax Return reporting such Taxes. 3.2 Payment of Taxes by CBS. CBS shall remit (or cause to be remitted) in a timely manner to the appropriate Tax Authority all Taxes due in respect of any Tax for which it is required to file a Tax Return pursuant to Section 2.2; provided, however, that Gaylord shall have paid CBS for the amount of such Taxes relating to any Pre-Closing Straddle Period, as provided in Section 3.1. 3.3 Apportionment in Straddle Periods. Where it is necessary pursuant to this Agreement to apportion between Gaylord, on the one hand, and CBS, on the other hand, the Tax liability of GCI, GTC or the Limited Partnership for a Straddle Period which is not treated under Section 2.4 as closing on the Closing Date, such liability shall be apportioned between the Pre-Closing Straddle Period and the Post-Closing Straddle Period on the basis of an interim closing of the books, except that Taxes imposed on a periodic basis (such as real property Taxes) shall be allocated on a daily basis. ARTICLE IV Representations, Warranties and Covenants for Tax Opinion 4.1 Joint Representations, Warranties and Covenants of the Parties. Each of CBS, Newco 1, Newco 2, Gaylord, GTC, and GCI, after due inquiry, hereby represents, warrants and covenants that, as of the date hereof and the Effective Time: (a) It understands that SASM&F will be relying upon the representations, warranties and covenants set forth in this Article IV in rendering the Tax Opinion. (b) The consideration to be received by Gaylord in the Mergers in exchange for the GCI Stock and the GTC Stock was negotiated by the parties to the CBS Merger Agreement at arm's length. (c) There is no intercorporate indebtedness for borrowed money existing between (x) CBS and any of its Subsidiaries and (y) Gaylord and any of its Subsidiaries, that was or will be issued, acquired, or settled at a discount. (d) In the Mergers, GCI Stock representing control of GCI and GTC Stock representing control of GTC, each within the meaning of Section 368(c) of the Code, will be exchanged for CBS Preferred Stock. For purposes of this representation, GCI Stock or GTC Stock exchanged in connection with the Mergers for cash or other property originating with CBS will be treated as outstanding GCI Stock or GTC Stock at the Effective Time. (e) It will not take (or cause to be taken) any position on any Tax Return, in any proceeding before any Tax Authority, or otherwise, that is inconsistent with the treatment of the Mergers as "reorganizations" within the meaning of Section 368(a) of the Code, unless otherwise required by a Final Determination. This paragraph will not be deemed violated if, with the prior written consent of Gaylord (which shall not be unreasonably withheld), CBS makes protective refund claims taking a contrary position, if necessary to keep open the applicable statutes of limitations for CBS for all taxable years since the Closing Date, so that such statutes remain open so long as CBS is potentially subject to an indemnification obligation under Section 5.3. 4.2 Representations, Warranties and Covenants of CBS and the Merger Subsidiaries. Each of CBS, Newco 1 and Newco 2, after due inquiry, hereby represents, warrants and covenants that, as of the date hereof and the Effective Time: (a) The facts relating to the contemplated Mergers to the extent described in the CBS Merger Agreement are, insofar as such facts pertain to CBS and the Merger Subsidiaries, true and correct in all material respects. (b) Except as provided in the CBS Merger Agreement, CBS and each of the Merger Subsidiaries will pay their respective expenses, if any, incurred in connection with the Mergers. However, to the extent any expenses related to the Mergers are to be funded directly or indirectly by a party other than the incurring party, such expenses are within the guidelines set forth in Rev. Rul. 73-54, 1973-1 C.B. 187. (c) Neither CBS nor either of the Merger Subsidiaries is an investment company within the meaning of Section 368(a)(2)(F)(iii) and (iv) of the Code. (d) Prior to the Effective Time, CBS will be in control of the Merger Subsidiaries within the meaning of Section 368(c) of the Code. (e) Each of the Merger Subsidiaries is a corporation directly owned by CBS, was formed at or about April 9, 1999, was created for the sole purpose of facilitating the Mergers and has not conducted any business activities other than in connection with the Mergers. (f) The Merger Subsidiaries will have no material liabilities assumed by GCI or GTC, and will not transfer to GCI or GTC any assets subject to material liabilities. (g) After the Mergers, (i) GCI will hold at least 90% of the fair market value of its net assets held immediately prior to the Mergers, and at least 70% of the fair market value of its gross assets held immediately prior to the Mergers, (ii) GTC will hold at least 90% of the fair market value of its net assets held immediately prior to the Mergers, and at least 70% of the fair market value of its gross assets held immediately prior to the Mergers, (iii) GCI will hold at least 90% of the fair market value of Newco 1's net assets and at least 70% of the fair market value of Newco 1's gross assets held immediately prior to the Mergers and (iv) GTC will hold at least 90% of the fair market value of Newco 2's net assets and at least 70% of the fair market value of Newco 2's gross assets held immediately prior to the Mergers. For purposes of this representation, (w) amounts paid by GCI or GTC to Gaylord in cash or other property (including any assets distributed to Gaylord prior to the Mergers), (x) amounts paid by either of the Merger Subsidiaries to CBS in cash or other property, (y) amounts paid by GCI, GTC or the Merger Subsidiaries to pay reorganization expenses, and (z) all redemptions and distributions (except for regular, normal dividends) made prior to or after the Mergers by GTC, GCI or the Merger Subsidiaries, in each of (w) through (z), in connection with the Mergers, will be included as assets of GCI, GTC or the Merger Subsidiaries, respectively, held immediately prior to the Mergers. For purposes of this representation, CBS assumes that the last sentence of Section 4.3(e) is correct. (h) Following the Mergers, GCI and GTC will continue their respective historic business or use a significant portion of their respective historic business assets in a business. (i) Except for exchanges of CBS Preferred Stock for Viacom Series C Preferred Stock pursuant to the Viacom Merger, none of CBS, any Related Person to CBS, or any Person acting as an intermediary for CBS or such a Related Person has a plan or intention to acquire any of the CBS Preferred Stock issued in the Mergers. (j) CBS has no plan or intention to liquidate GCI or GTC, to merge GCI or GTC with or into another corporation, to cause GCI or GTC to issue additional shares of stock that could result in CBS losing control of GCI or GTC within the meaning of Section 368(c) of the Code, to sell, transfer or otherwise dispose of the stock of GCI or GTC (except for transfers of stock described in Treasury Regulation Section 1.368-2(k)(2) or the transfer by CBS of the stock of GCI or GTC to Viacom pursuant to the Viacom Merger), or to cause GCI or GTC to sell, transfer or otherwise dispose of any of its assets (except for dispositions made in the ordinary course of business or transfers of assets described in Treasury Regulation Section 1.368-2(k)(2)). Within the two year period following the Closing Date, CBS will not liquidate GCI or GTC or cause GCI or GTC to merge with or into another corporation. (k) Neither CBS nor any of its Subsidiaries owns, directly or indirectly, any GCI Stock or GTC Stock. Neither CBS nor any of its Subsidiaries (during the period they have been Subsidiaries of CBS) owned, directly or indirectly, any GCI Stock or GTC Stock in the five year period immediately prior to the Effective Time. In addition, except pursuant to the CBS Merger Agreement, no Related Person to CBS (i) owns or will own any GCI Stock or GTC Stock before the Mergers or (ii) will acquire GCI Stock or GTC Stock before the Mergers in connection with the Mergers (within the meaning of Treasury Regulation Section 1.368-1(e)(2)). (l) The consideration to be received by Gaylord in the Viacom Merger in exchange for the CBS Preferred Stock was negotiated by the parties to the Viacom Merger Agreement at arm's length. (m) prior to the Viacom Effective Time, CBS, GTC, GCI and Viacom shall execute the First Amendment to Amended and Restated Tax Matters Agreement attached hereto as Annex A (the "First Amendment"). 4.3 Representations, Warranties, and Covenants of Gaylord, GCI and GTC. Each of Gaylord, GCI and GTC, after due inquiry, represents, warrants and covenants that, as of the date hereof and the Effective Time: (a) The facts relating to the contemplated Mergers to the extent described in the CBS Merger Agreement are, insofar as such facts pertain to Gaylord, GCI and GTC, true and correct in all material respects. (b) Except as provided in the CBS Merger Agreement, Gaylord, GCI and GTC will pay their respective expenses, if any, incurred in connection with the Mergers. However, to the extent any expenses related to the Mergers are to be funded directly or indirectly by a party other than the incurring party, such expenses are within the guidelines set forth in Rev. Rul. 73-54, 1973-1 C.B. 187. (c) Neither Gaylord, GCI nor GTC is an investment company within the meaning of Section 368(a)(2)(F)(iii) and (iv) of the Code. (d) Neither GCI nor GTC nor any Related Person to GCI or GTC has redeemed or otherwise acquired or has any present plan or intention to redeem or otherwise acquire any GCI Stock or GTC Stock in anticipation of the Mergers, or otherwise as part of a plan of which the Mergers are a part. Except as contemplated by the CBS Merger Agreement, neither GCI nor GTC nor any Related Person to GCI or GTC has made or has any present plan or intention to make any extraordinary distributions with respect to GCI Stock or GTC Stock. (e) At the time of the Mergers, (i) GCI will hold at least 90% of the fair market value of its net assets held immediately prior to the Mergers, and at least 70% of the fair market value of its gross assets held immediately prior to the Mergers and (ii) GTC will hold at least 90% of the fair market value of its net assets held immediately prior to the Mergers, and at least 70% of the fair market value of its gross assets held immediately prior to the Mergers. For purposes of this representation, (x) amounts paid by GCI or GTC to Gaylord in cash or other property (including any assets distributed to Gaylord prior to the Mergers), (y) amounts paid by GCI or GTC to pay reorganization expenses, and (z) all redemptions and distributions (except for regular, normal dividends) made prior to the Mergers by GTC or GCI, in each of (x) through (z), in connection with the Mergers, will be included as assets of GCI or GTC, respectively, held immediately prior to the Mergers. The sum of (A) the amounts referred to in clauses (x) through (z) above and (B) any other amounts paid or transferred by GCI or GTC in connection with the Mergers does not exceed 9% of the fair market value of the net or gross assets of GCI or GTC, as applicable, held immediately prior to the Mergers. (f) Neither GCI nor GTC will have outstanding any warrants, options, convertible securities, or any other type of right pursuant to which any Person could acquire stock in GCI or GTC, that if exercised or converted, would affect CBS's acquisition or retention of control of GCI or GTC, as defined in Section 368(c) of the Code. (g) Neither GTC nor GCI is a party to, or is under the jurisdiction of a court in a case under Title 11 of the United States Code, and neither GCI nor GTC is in receivership, foreclosure, or similar proceeding in a federal or state court (including a case within the meaning of Section 368(a)(3)(A) of the Code.) (h) Gaylord has no plan or intention to convert any CBS Preferred Stock into CBS Common Stock prior to the Viacom Merger. (i) Gaylord has no plan or intention to convert any Viacom Series C Preferred Stock received in exchange for its CBS Preferred Stock in the Viacom Merger into Viacom Class B Common Stock. ARTICLE V Indemnification 5.1 Obligations of Gaylord. Except as provided in Section 5.3, Gaylord shall indemnify and hold the CBS Indemnitees harmless from and against the following: (a) any liability for Taxes of Gaylord, GCI, GTC or the Limited Partnership for any Pre-Closing Period and any Pre-Closing Straddle Period, including any liability of any of GCI or GTC arising under the provisions of Treasury Regulation Section 1.1502-6(a) or comparable provisions of foreign, state or local law for any Pre-Closing Period and Pre-Closing Straddle Period (other than liabilities for Taxes described in Section 5.2(b)); (b) any liability for income, state franchise or similar Taxes (excluding any transfer or similar taxes covered by Section 5.1 of the CBS Merger Agreement) of GCI, GTC or the Limited Partnership with respect to any taxable income recognized solely from the transfer of GTC Stock and GCI Stock to CBS in exchange for the consideration provided for in the CBS Merger Agreement (c) any liability for Taxes of the CBS Indemnitees arising from a breach of any representation or warranty contained in Section 2.6 of the CBS Merger Agreement, calculated as the amount of the excess of (x) the actual liability for Taxes of the CBS Indemnitee for the relevant taxable period over (y) the liability for Taxes of the CBS Indemnitee for such taxable period assuming such breach of representation or warranty had not occurred but with all other facts unchanged. 5.2 Obligations of CBS. CBS shall indemnify and hold the Gaylord Indemnitees harmless from and against the following: (a) any liability for Taxes of GCI, GTC, or the Limited Partnership for any Post-Closing Period and any Post-Closing Straddle Period (other than liabilities for Taxes described in Section 5.1(b) or (c)); and (b) any liability for Taxes of the Gaylord Indemnitees arising from a breach of any representation or warranty contained in Section 3.11 of the CBS Merger Agreement, calculated as the amount of the excess of (x) the actual liability for Taxes of the Gaylord Indemnitee for the relevant taxable period over (y) the liability for Taxes of the Gaylord Indemnitee for such taxable period assuming such breach of representation, covenant or warranty had not occurred but with all other facts unchanged. 5.3 Additional Obligations of CBS. (a) (i) If, notwithstanding the intention of the parties hereto, (1) there is a Final Determination that the GTC Merger or the GCI Merger does not qualify as a "reorganization" within the meaning of Section 368(a) of the Code, (2) such failure to qualify as a "reorganization" is attributable to (A) a breach by CBS of a representation, covenant or warranty contained in Section 4.1 or Section 4.2 of this Agreement, (B) any amendment to the Viacom Merger Agreement attached as Schedule 5.13 to the CBS Merger Agreement (regardless of the effective date of such amendment), or (C) a failure of any representation, covenant or warranty contained in the First Amendment to be true (whether or not such First Amendment is executed as of the Viacom Effective Time), (3) Gaylord has not breached a representation, covenant or warranty contained in Section 4.1(b), (c), (d) or (e) and (4) there is no (A) breach of any representation, covenant or warranty by Gaylord, GCI or GTC contained in Section 4.3, (B) conversion by Gaylord of any Viacom Series C Preferred Stock into Viacom Class B Common Stock, or (C) conversion of CBS Preferred Stock into shares of CBS Common Stock prior to the Viacom Merger, that in any case (A), (B) or (C), materially contributes to such failure to qualify as a reorganization, then CBS shall indemnify and hold the Gaylord Indemnitees harmless from and against any liability for Taxes of Gaylord, Gaylord's Subsidiaries, GCI, GTC or the Limited Partnership arising from any such breach, calculated as the amount of the excess of (x) the actual liability for Taxes of Gaylord, Gaylord's Subsidiaries, GCI, GTC or the Limited Partnership for the taxable year that includes the Closing Date over (y) the liability for Taxes of Gaylord, Gaylord's Subsidiaries, GCI, GTC or the Limited Partnership for such taxable year assuming such breach of representation, covenant or warranty had not occurred but with all other facts unchanged. In making the calculation in the preceding sentence, any Taxes imposed on the Gaylord Indemnitees as a result of receiving indemnity payments under this Section 5.3(a)(i) shall be disregarded and not indemnified against by CBS. (ii) If (1) an amount would be payable by CBS to a Gaylord Indemnitee under Section 5.3(a)(i), (2) within ten years after the Closing Date Gaylord (or a successor or affiliate) disposes (including a constructive sale under Section 1259 of the Code) of all or a portion of its CBS Preferred Stock (or a successor asset which is "substituted basis property" within the meaning of Section 7701(a)(42) of the Code including the CBS Common Stock, the Viacom Series C Preferred Stock and the Viacom Class B Common Stock) in one or more taxable transactions and (3) as a result of the Final Determination described in Section 5.3(a)(i)(1), Gaylord (or a successor or affiliate) has a tax basis in such CBS Preferred Stock (or such successor asset) equal to the fair market value of such CBS Preferred Stock on the Closing Date, then the amount payable by CBS to the Gaylord Indemnitees under Section 5.3(a)(i) shall be reduced (or, to the extent that such taxable disposition within such ten year period occurs after such Final Determination, Gaylord shall reimburse CBS for any such payment) to the extent necessary so that the Gaylord Indemnitees are in the same after-Tax position as if the Mergers qualified as "reorganizations" under Section 368(a) of the Code (taking into account the Tax consequences of the Mergers, such taxable disposition(s) of such CBS Preferred Stock (or such successor asset), Gaylord's receipt of the indemnity payments from CBS under Section 5.3(a)(i), and any reduction or return of such indemnity payments to CBS pursuant to this Section 5.3(a)(ii) but disregarding any increased tax basis in the CBS Preferred Stock (or such successor asset) that has not been so disposed of); provided, however, that if the conditions described in Section 5.3(b)(i), (iii) and (iv) are satisfied, the net amount of any payments from CBS to the Gaylord Indemnitees pursuant to this Section 5.3(a)(ii) to be retained by the Gaylord Indemnitees hereunder shall in no event be less than the amount payable by CBS pursuant to Section 5.3(b)(A) and (B). (b) If, notwithstanding the intention of the parties hereto, (i) there is a Final Determination that the GTC Merger does not qualify as a "reorganization" within the meaning of Section 368(a) of the Code, (ii) Section 5.3(a) does not apply, (iii) CBS obtains a "cost" basis in substantially all the assets of the Limited Partnership (based on the value of the CBS Preferred Stock issued to Gaylord in exchange for the stock of GTC), and (iv) CBS is not precluded from depreciating or amortizing substantially all of the tax basis of the otherwise depreciable or amortizable assets of the Limited Partnership because of the "anti-churning" provisions under Section 197(f))(9) of the Code, then CBS shall pay to Gaylord the amount of (A) $40 million, subject to reduction, as determined pursuant to Section 6.1(c), plus (B) the amount of interest, if any, received by CBS from any Taxing Authority which is attributable to any overpayment of Taxes solely resulting from the GTC Merger failing to qualify as a "reorganization" within the meaning of Section 368(a) of the Code. 5.4 Tax Obligations Arising Under a Pre-Closing Period Tax Sharing Agreement. Except as set forth in this Agreement, all existing tax sharing agreements and practices regarding Taxes and their payment, allocation or sharing between any member of the Gaylord Group and any of GCI, GTC or the Limited Partnership shall be terminated as of the Closing Date and no remaining liabilities thereunder shall exist thereafter. 5.5 Refunds. Gaylord shall be entitled to any refund of Taxes of GCI, GTC or the Limited Partnership attributable to any Pre-Closing Period and any Pre-Closing Straddle Period; provided, however, that Gaylord shall not be entitled to any such refunds of Taxes with respect to any amounts paid to Gaylord pursuant to Section 2.2. If CBS, GCI, GTC, the Limited Partnership or any of their Subsidiaries receives any refund of Tax to which Gaylord is entitled pursuant to this Section 5.5, CBS shall promptly notify Gaylord and shall pay the amount of any such refund promptly after the receipt of such refund. 5.6 Payments. (a) To the extent that a party (the "Payor") is required to make a payment to another party (the "Payee") pursuant to this Article V, the Payor shall pay the Payee the amount of such payment obligation no later than five business days after the later of (i) a Final Determination or other event giving rise to the payment obligation and (ii) the Payee's presentment to the Payor of its calculation of the amount payable by the Payor. (b) Any amount payable under this Article V shall be payable in cash in immediately available funds. 5.7 Limitations. Except as otherwise provided in this Agreement, the principles of Section 8.5 of the CBS Merger Agreement shall apply to any indemnity payment under this Agreement. 5.8 Allocation of Indemnity Payments. Gaylord and CBS agree to allocate any indemnification payments received or paid by either party under this Article V to the exchange of GTC Stock and GCI Stock, respectively, in the Mergers on the same percentage basis as is provided in Section 1.9 of the CBS Merger Agreement. 5.9 Exclusive Remedy. The parties acknowledge and agree that the right of the Gaylord Indemnitees for indemnification as provided for in Section 5.3 shall be the sole and exclusive remedy of the Gaylord Indemnitees in the event of any breach by CBS, Newco 1 or Newco 2 of any of their respective representations, covenants and warranties contained in Section 4.1 and 4.2 of this Agreement. ARTICLE VI Tax Claims 6.1 General. (a) Gaylord shall have exclusive control over Tax Claims for which Gaylord is liable pursuant to Section 5.1, and any other Tax Claim concerning the status of the GTC Merger as a reorganization under Section 368(a) of the Code (any such claim, a "Merger Claim") that is not covered by Section 6.1(b) or (c). (b) CBS and Gaylord shall jointly control (at each party's own expense) any Merger Claim that would result in an indemnity obligation under Section 5.3(a) hereof, if Section 5.3(a)(ii) does not apply. Neither party may settle, concede or make any concession (including failure to appeal such Merger Claim) without the other party's written consent. (c) With respect to any Merger Claim, if (1) it would result in an indemnity obligation under Section 5.3(a) and Section 5.3(a)(ii) applies, or it would result in an indemnity obligation under Section 5.3(b) and (2) the net present value of the Tax benefits reasonably expected to be received by CBS and its Subsidiaries as a result of a Final Determination with respect to such Merger Claim (the "CBS Tax Benefit") is less than $40 million, then Gaylord shall be entitled to elect either (x) to jointly control the Merger Claim with CBS as described in Section 6.1(b), in which case CBS's indemnification obligation under Section 5.3(b)(A) (directly or through the operation of Section 5.3(a)(ii)) shall be $40 million, or (y) to have exclusive control over the Merger Claim as described in Section 6.1(a) (but subject to CBS's right to participate in, but not control, the Merger Claim at its own expense), in which case CBS's indemnification obligation under Section 5.3(b)(A) (directly or through the operation of Section 5.3(a)(ii)) shall be the lesser of $40 million and the amount of the CBS Tax Benefit. (d) CBS shall have exclusive control over all other Tax Claims. (e) The party controlling a Tax Claim pursuant to this Section 6.1 shall have the sole right to contest, litigate and Dispose of such Tax Claim and to employ counsel of its choice at its sole expense. 6.2 Tax Claim Management. CBS or Gaylord, as the case may be, shall promptly notify the other party in writing of any Tax Claim that may reasonably be likely to result in liability of the other party under this Agreement; provided, however, that the failure to provide such notice shall not diminish the indemnifying party's obligation hereunder except to the extent such failure actually prejudices the indemnifying party's position as a result thereof. With respect to any such Tax Claim, the party not controlling such Tax Claim shall (i) not make any submission to any Tax Authority without offering the other party the opportunity to review such submission, (ii) not take any action or make (or purport to make) any representations in connection with such Tax Claim with respect to issues affecting the other party's indemnity hereunder, (iii) keep the other party informed as to any information that it receives regarding the progress of such Tax Claim, (iv) provide the other party with any information that it receives regarding the nature and amounts of any proposed Disposition of the Tax Claim, (v) permit the other party to participate in all conferences, meetings or proceedings with any Tax Authority in which the indemnified Tax Claim is or may be a subject, and (vi) permit the other party to participate in all court appearances in which the indemnified Tax Claim is or may be a subject. With respect to any Tax Claim relating to a Pre-Closing Period for which Gaylord is liable pursuant to this Agreement, CBS shall either file (or cause to be filed) submissions at Gaylord's direction or appoint (or cause to be appointed) Gaylord or its authorized representatives as additional authorized representatives entitled to communicate fully with the Internal Revenue Service with respect to such Tax Claim. ARTICLE VII Cooperation CBS and Gaylord shall (and shall cause their respective Subsidiaries to) cooperate with each other in the preparation and filing of any Tax Returns and the conduct of any audit or other proceeding and each shall execute and deliver such powers of attorney and make available such other documents as are necessary to carry out the intent of this Agreement. Such cooperation shall include, without limitation, (a) making employees available on a mutually convenient basis to provide such assistance as might reasonably be required and (b) providing such information as might reasonably be required in connection with any such Tax Return or proceeding, including without limitation, records, returns, schedules, documents, work papers or other relevant materials. In addition, Gaylord shall provide such available information to CBS as is reasonably necessary for CBS to determine its tax basis in the stock of GTC and GCI and in the Limited Partnership, and the tax basis of the Limited Partnership in its assets. The parties hereto shall use reasonable efforts to reduce any transfer, sales or other similar Taxes that may be incurred with respect to the transactions contemplated by the CBS Merger Agreement. ARTICLE VIII Retention of Records; Access CBS, GCI, GTC and the Limited Partnership and Gaylord shall (a) until the expiration of the relevant statutes of limitations (giving effect to any applicable extensions or waivers), retain records, documents, accounting data and other information (including computer data) necessary for the preparation and filing of all Tax Returns in respect of Taxes of GCI, GTC and the Limited Partnership or for a Tax Claim by a Tax Authority relating to such Tax Returns; and (b) give to the other group reasonable access to such records, documents, accounting data and other information (including computer data) and to its personnel (ensuring their cooperation) and premises, with reimbursement by the requesting group of reasonable out-of-pocket costs incurred therewith, for the purpose of the review or audit of such Tax Returns to the extent relevant to an obligation or liability of any party under this Agreement. Prior to destroying any records, documents, data or other information described in this Article VIII, the group wishing to destroy such items shall give the other group a reasonable opportunity to obtain such items (at such other group's expense). ARTICLE IX Disputes If the parties disagree as to the calculation of a Tax or the amount of (but not liability for) any payment to be made under this Agreement, the parties shall cooperate in good faith to resolve any such dispute, and any agreed-upon amount shall be paid to the appropriate party. If the parties are unable to resolve any such dispute within fifteen business days thereafter, such dispute shall be resolved by an internationally recognized accounting firm acceptable to both CBS and Gaylord. The decision of such firm shall be final and binding. The fees and expenses incurred in connection with such decision shall be shared by CBS and Gaylord in accordance with the final allocation of the Tax liability in dispute. Following the decision of such accounting firm, the parties shall each take (or cause to be taken) any action that is necessary or appropriate to implement such decision, including, without limitation, the filing of amended Tax Returns and the prompt payment of underpayments or overpayments, with interest calculated on such underpayments or overpayment at the Underpayment Rate from the date such payment was due. ARTICLE X Survival Notwithstanding any other provision in this Agreement to the contrary, the rights and obligations provided for in this Agreement shall not terminate any earlier than the expiration of the applicable statute of limitation for the relevant taxable periods in question (giving effect to any applicable waivers or extensions). ARTICLE XI Miscellaneous Provisions 11.1 Interest on Late Payments. Any payment required by this Agreement which is not made on or before the date required to be made hereunder shall bear interest after such date at the Underpayment Rate. 11.2 Notices and Governing Law. All notices required or permitted to be given pursuant to this Agreement shall be given, and the applicable law governing the interpretation of this Agreement shall be determined, in accordance with the applicable provisions of the CBS Merger Agreement. 11.3 Amendments. This Agreement may not be amended except by an agreement in writing, signed by the parties. 11.4 Binding Effect; No Assignment; Third Party Beneficiaries. This Agreement shall be binding on, and shall inure to the benefit of, the parties and the respective successors, assigns, and Persons controlling any of the corporations bound hereby. CBS, on the one hand, and Gaylord, on the other hand, hereby guarantee the performance of all actions, agreements and obligations provided for under this Agreement of CBS's Subsidiaries and Gaylord's Subsidiaries, respectively. CBS and Gaylord shall, upon the written request of any other party, cause any of their respective Subsidiaries to execute this Agreement. No party to this Agreement shall assign any of its rights or delegate any of its duties under this Agreement without the prior written consent of Gaylord, in the case of CBS, and CBS, in the case of Gaylord. No Person (including, without limitation, any employee of a party or any stockholder of a party) shall be, or shall be deemed to be, a third party beneficiary of this Agreement. 11.5 Entire Agreement. This Agreement constitutes the entire agreement of the parties concerning the subject matter hereof and supersedes all prior agreements, whether or not written, concerning such subject matter. To the extent that the provisions of this Agreement are inconsistent with the provisions of the CBS Merger Agreement, the provisions of this Agreement shall prevail. 11.6 Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute together the same documents. IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the day and year first above written. GAYLORD ENTERTAINMENT COMPANY By: /s/ Joseph B. Crace -------------------------------- Name: Joseph B. Crace Title: GAYLORD TELEVISION COMPANY By: /s/ Joseph B. Crace -------------------------------- Name: Joseph B. Crace Title: GAYLORD COMMUNICATIONS, INC. By: /s/ Joseph B. Crace -------------------------------- Name: Joseph B. Crace Title: CBS CORPORATION By: /s/ Louis J. Briskman -------------------------------- Name: Louis J. Briskman Title: EX-5.1 5 OPINION OF LOUIS J. BRISKMAN, ESQ. October 12, 1999 CBS Corporation 51 West 52nd Street New York, N.Y. 10019 Re: CBS Corporation Registration Statement On Form S-3 Relating to the CBS/Gaylord Transaction Ladies and Gentlemen: As set forth in the Registration Statement on Form S-3 (the "Registration Statement") to be filed by CBS Corporation, a Pennsylvania corporation ("CBS"), under the Securities Act of 1933, as amended, relating to the sale of shares of CBS's common stock, par value $1.00 per share ("CBS Common Stock"), issuable upon conversion of shares of CBS's Series B Participating Preferred Stock, par value $1.00 per share ("Preferred Stock"), I am rendering this opinion with respect to the validity of the shares of CBS Common Stock to be issued. At your request, this opinion is being furnished to you for filing as Exhibit 5 to the Registration Statement. As set forth in the Registration Statement, CBS will issue shares of the Preferred Stock in connection with the consummation of the mergers of CBS Dallas Media, Inc., a Delaware corporation and a wholly-owned subsidiary of CBS ("CBS Dallas Media"), with and into Gaylord Television Company, a Delaware corporation ("GTC"), and CBS Dallas Ventures, Inc., a Delaware corporation and a wholly-owned subsidiary of CBS ("CBS Dallas Ventures"), with and into Gaylord Communications, Inc., a Texas corporation ("GCI"), pursuant to the Agreement and Plan of Merger (the "Merger Agreement"), dated as of April 9, 1999, as amended as of October 8, 1999, by and among Gaylord Entertainment Company, a Delaware corporation, CBS, GTC, GCI, CBS Dallas Media and CBS Dallas Ventures. The Preferred Stock is convertible by the holder into shares of CBS Common Stock at any time. The Registration Statement relates to the shares of CBS Common Stock issuable upon conversion of the Preferred Stock. In my capacity as General Counsel for CBS, I have examined, either personally or indirectly through lawyers who report to me or through other counsel, originals or copies (certified or otherwise identified to my satisfaction) of the Merger Agreement and such corporate records, agreements, documents and other instruments, and such certificates or comparable documents of public officials and of officers and representatives of CBS, and have made such inquiries of such officers and representatives, as I have deemed relevant and necessary as the basis for the opinions hereinafter set forth. In such examination, I have assumed the genuineness of all signatures, the legal capacity of all natural persons, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified, conformed or photostatic copies and the authenticity of the originals of such latter documents. As to all questions of fact material to these opinions that have not been independently established, I have relied upon certificates or comparable documents of officers and representatives of CBS and upon the representations and warranties of CBS contained in the Merger Agreement. Based on the foregoing, I am of the opinion that the shares of CBS Common Stock to be issued upon the conversion of the shares of Preferred Stock to be issued pursuant to the Merger Agreement have been duly authorized and, when any such shares of CBS Common Stock have been issued upon any such conversion, such shares of CBS Common Stock will be validly issued, fully paid and nonassessable. 2 I express no opinion with respect to the laws of any jurisdiction other than the corporate laws of the Commonwealth of Pennsylvania and the federal securities laws of the United States. I hereby consent to the use of this opinion letter as an exhibit to the Registration Statement and to any and all references to me in the prospectus which is a part of the Registration Statement. Very truly yours, /s/ Louis J. Briskman ------------------------- Louis J. Briskman Executive Vice President and General Counsel EX-23.1 6 CONSENT OF INDEPENDENT AUDITORS CONSENT OF INDEPENDENT AUDITORS We consent to the use of our report dated January 27, 1999, appearing on page 21 of CBS Corporation's Form 10-K/A and page 55 of CBS Corporation's Form 10-K for the year ended December 31, 1998, incorporated by reference in this registration statement of the Company and the reference to our firm under the heading 'Experts' in this registration statement. /s/ KPMG LLP ------------------------------ New York, New York October 6, 1999 EX-23.2 7 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS EXHIBIT 23.2 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in this registration statement on Form S-3 dated October 12, 1999 of our report dated October 16, 1998 included in King World Productions, Inc.'s Annual Report on Form 10-K for the year ended August 31, 1998 and to all references to our Firm included in this registration statement. /s/ Arthur Andersen LLP ------------------------- New York, New York October 12, 1999 EX-23.3 8 CONSENT OF PRICEWATERHOUSECOOPERS LLP EXHIBIT 23.3 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of CBS Corporation of our report dated February 8, 1999, except for the first paragraph of Note 2, which is as of February 25, 1999, relating to the financial statements and financial statement schedule of Viacom Inc., which appears in CBS Corporation's Form 8-K dated October 8, 1999. We also consent to the reference to us under the heading "Experts" in such Registration Statement. PricwaterhouseCooopers LLP New York, New York October 12, 1999 -----END PRIVACY-ENHANCED MESSAGE-----