Norfolk Southern Announces Pricing of Exchange Offers

NORFOLK, Va., May 10 /PRNewswire-FirstCall/ -- Norfolk Southern Corporation ("Norfolk Southern") announced today the pricing for its outstanding offers to exchange new unsecured Norfolk Southern debt securities and cash for up to $350 million aggregate principal amount of its 7.80% notes due May 15, 2027, up to $200 million aggregate principal amount of its 7.25% notes due Feb. 15, 2031, and for any or all of its 9.00% notes due March 1, 2021.

As described in the prospectuses dated April 15, 2005, the total exchange price for each series of outstanding notes was calculated based on the yield of 4.594% on the 5.375% U.S. Treasury Notes due Feb. 15, 2031, as of 2 p.m. New York City time on May 10, 2005, the reference treasury security, plus a fixed spread of 85 basis points for the old notes due 2027, 87.5 basis points for the old notes due 2031 and 75 basis points for the old notes due 2021.

For each series of old notes validly tendered and accepted for exchange, the total exchange price will be: (i) $1,299.97 per $1,000 principal amount of notes due 2027, (ii) $1,244.34 per $1,000 principal amount of old notes due 2031 and (iii) $1,386.47 per $1,000 principal amount of old notes due 2021. Payment will be made in the form of a principal amount of new notes equal to the principal amount of old notes accepted for exchange plus a cash payment equal to the total exchange price minus the principal amount of new notes issued.

The total exchange price for each series of old notes includes an early participation cash payment of $20 per $1,000 principal amount of old notes accepted for exchange payable to holders who validly tendered their old notes before 5 p.m. New York City time on April 28, 2005 and do not withdraw.

Holders who validly tender their old notes after that time, but on or prior to the expiration of the exchange offers, and do not withdraw, will receive, for each $1,000 principal amount of old notes, new notes in a principal amount equal to the principal amount of old notes tendered plus a cash payment equal to the total exchange price minus the principal amount of new notes issued less the early participation cash payment.

Holders who validly tendered old notes due 2027 will receive new 5.64% notes due May 17, 2029 and holders who validly tendered old notes due 2031 or 2021 will receive new 5.59% notes due May 17, 2025. The interest rate on the new notes due May 17, 2029 was calculated based on the yield on the reference treasury security plus 105 basis points. The interest rate on the new notes due May 17, 2025 was calculated based on the yield on the reference treasury security plus 100 basis points.

The exchange offers will expire at 12 midnight, New York City time, on May 12, 2005, unless extended. Notes validly tendered may be withdrawn at any time prior to the expiration date.

Deutsche Bank Securities is the coordinator for the exchange offers. Deutsche Bank Securities and Merrill Lynch & Co. are the joint-lead dealer managers, and Citigroup and Barclays Capital are the co-dealer managers for the exchange offers.

Norfolk Southern, through its Norfolk Southern Railway Company subsidiary, operates approximately 21,300 route miles in 22 states, the District of Columbia and Ontario, Canada, serving every major container port in the eastern United States and providing connections to western rail carriers. Norfolk Southern operates an extensive intermodal network and is the nation's largest rail carrier of automotive parts and finished vehicles.

A registration statement relating to the exchange offers has been filed with the SEC and was declared effective on April 14, 2005. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of these securities in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.

ADDITIONAL INFORMATION AND WHERE TO FIND IT

A prospectus and related exchange offer materials have been mailed to holders of the old notes in connection with the proposed exchange offers. These documents contain important information about the proposed exchange offers. HOLDERS OF THE OLD NOTES ARE URGED TO READ THESE DOCUMENTS CAREFULLY WHEN THEY BECOME AVAILABLE. Holders of the old notes will be able to obtain free copies of documents related to the exchange offers through the website maintained by the SEC at http://www.sec.gov/. In addition, free copies of any of these documents may be obtained from Norfolk Southern by directing a request to: Norfolk Southern Corp., Three Commercial Place, Norfolk, VA 23510, Attention: Corporate Secretary, 757-629-2680. In addition to the registration statement and prospectuses, Norfolk Southern files annual, quarterly and special reports, proxy statements and other information with the SEC. These SEC filings are available to the public through the website maintained by the SEC at http://www.sec.gov/. Written prospectuses meeting the requirements of Section 10 of the Securities Act of 1933, in connection with the exchange offers, may also be obtained from: Global Bondholders Services Corp., 65 Broadway-Suite 704, New York, New York 10006, Attention: Corporate Affairs, phone number: 212-430-3774 or 866-470-4500. For questions regarding the exchange offers, please contact Deutsche Bank Securities, Liability Management Group, 866-627-0391 (toll free) or 212-250-2955.