PROSPECTUS SUPPLEMENT
(To Prospectus Dated August 19, 1998)
$525,000,000
General Motors Corporation
7.25% QUARTERLY INTEREST BONDS DUE APRIL 15, 2041 (QUIBS)*
------------------
Interest payable on January 15, April 15, July 15 and October 15
-----------------
This is an offering of 7.25% Quarterly Interest Bonds due April 15, 2041 (the
"Bonds") to be issued by General Motors Corporation ("GM"). The Bonds will be
general unsecured, unsubordinated obligations of GM. The Bonds will mature on
April 15, 2041. The Bonds will bear interest from April 30, 2001, at the rate of
7.25% per annum, payable quarterly on January 15, April 15, July 15 and October
15 of each year, commencing on July 15, 2001. We will have the right to redeem
the Bonds in certain circumstances if we are unable to deduct interest paid on
the Bonds. The Bonds also will be redeemable at our option, in whole or part, at
any time on or after April 30, 2006, upon not less than 30 nor more than 60
days' notice, at a redemption price equal to 100% of the principal amount
redeemed plus accrued and unpaid interest to the redemption date. The Bonds will
be issued in minimum denominations of $25 and in multiples of $25.
We will apply to list the Bonds on the New York Stock Exchange and expect
trading in the Bonds on the New York Stock Exchange to begin within 30 days
after the original issue date.
--------------------
PRICE 100% AND ACCRUED INTEREST, IF ANY
------------------
Discounts and
Price to Underwriting Proceeds
Public Commissions to GM
------ ----------- -----
Per Bond...................... 100.00% 3.15 % 96.85%
Total......................... $525,000,000 $16,537,500 $508,462,500
------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus supplement or the related prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
The underwriters expect to deliver the Bonds to purchasers on April 30, 2001.
We have granted the underwriters a right to request from us the opportunity to
purchase up to an additional $50,000,000 aggregate principal amount of Bonds to
cover overallotments, if any. Whether or not to approve the request is totally
at our discretion.
------------------
*QUIBS is a servicemark of Morgan Stanley Dean Witter & Co.
-----------------
MORGAN STANLEY DEAN WITTER
ABN AMRO INCORPORATED
A.G. EDWARDS & SONS, INC.
BANC ONE CAPITAL MARKETS, INC.
CIBC WORLD MARKETS
MERRILL LYNCH & CO.
PRUDENTIAL SECURITIES
SALOMON SMITH BARNEY
April 20, 2001 UBS WARBURG
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
Page
----
Incorporation of Certain Documents by Reference......................... S-3
Ratio of Earnings to Fixed Charges...................................... S-3
Use of Proceeds......................................................... S-3
Description of the Bonds................................................ S-4
U.S. Tax Considerations................................................. S-6
Underwriting............................................................ S-9
Legal Opinions.......................................................... S-11
PROSPECTUS
Page
----
Available Information .................................................. 1
Incorporation of Certain Documents by Reference ........................ 1
General Motors Corporation.............................................. 2
Use of Proceeds......................................................... 2
Ratio of Earnings to Fixed Charges...................................... 3
Description of Debt Securities.......................................... 3
Description of Warrants................................................. 11
Plan of Distribution.................................................... 12
Experts................................................................. 13
Legal Opinions.......................................................... 13
Unless the context indicates otherwise, the words "GM", "we", "our",
"ours", and "us" refer to General Motors Corporation.
You should rely only on the information contained in or incorporated by
reference in this prospectus supplement and the accompanying prospectus. We have
not, and the underwriters have not, authorized any other person to provide you
different information or to make any additional representations. We are not, and
the underwriters are not, making an offer of any securities other than the
Bonds. This prospectus supplement is part of and must be read in conjunction
with the accompanying prospectus dated August 19, 1998. You should not assume
that the information appearing in this prospectus supplement and the
accompanying prospectus, as well as the information incorporated by reference,
is accurate as of any date other than the date on the front cover of this
prospectus supplement.
S-2
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to "incorporate by reference" information we file with
them, which means that we can disclose important information to you by referring
you to those documents, including our annual, quarterly and current reports,
that are considered part of this prospectus supplement and accompanying
prospectus. Information that we file later with the SEC will automatically
update and supersede this information.
We incorporate by reference the documents set forth below that we
previously filed with the SEC. These documents contain important information
about General Motors Corporation and its finances.
SEC Filings (File No. 1-143) Period
Annual Report on Form 10-K............ Year ended December 31, 2000
Current Reports on Form 8-K January 3, 2001, January 8, 2001, January
16, 2001 (2), January 17, 2001, February
1, 2001, February 6, 2001, February 9,
2001, February 22, 2001, March 1, 2001,
March 29, 2001, April 3, 2001, April 17,
2001 (2), April 18, 2001 (3) and April
20, 2001
You may, at no cost, request a copy of the documents incorporated by
reference in this prospectus supplement and accompanying prospectus, except
exhibits to such documents, by writing or telephoning the office of W. W. Creek,
Controller, at the following address and telephone number:
General Motors Corporation
300 Renaissance Center
Detroit, Michigan 48265-3000
Tel: (313) 556-5000
RATIO OF EARNINGS TO FIXED CHARGES
Years Ended
December 31,
------------
2000 1999
---- ----
1.71 2.12
The ratio of earnings to fixed charges has been computed by dividing
earnings before income taxes and fixed charges by the fixed charges.
See "Ratio of Earnings to Fixed Charges" in the accompanying prospectus
for additional information.
USE OF PROCEEDS
We will use the net proceeds (approximately $508,000,000 after deducting
underwriting discounts, commissions and expenses or approximately $557,000,000
if the underwriters exercise their over-allotment option in full) for general
corporate purposes, including the repayment of existing indebtedness.
S-3
DESCRIPTION OF THE BONDS
General
The following description of the particular terms of the Bonds offered
hereby supplements and, to the extent that the terms are inconsistent, replaces
the description of the general terms and provisions of the Debt Securities set
forth in the accompanying prospectus. The Bonds are part of the Debt Securities
registered by GM in August 1998 to be issued on terms to be determined at the
time of sale.
The Bonds offered hereby will be issued in an initial aggregate principal
amount of $525,000,000 pursuant to an Indenture dated as of December 7, 1995,
between us and Citibank, N.A. (the "Trustee"), which is more fully described in
the accompanying prospectus and the Bonds have been authorized and approved by
resolution of our Board of Directors.
The Indenture and the Bonds are governed by, and construed in accordance
with, the laws of the State of New York, United States.
The Bonds will be unsecured obligations of GM and will rank equally with
all other unsecured and unsubordinated indebtedness of GM. The Bonds will mature
on April 15, 2041. The Bonds are expected to be listed on the New York Stock
Exchange. The Bonds will bear interest, calculated on the basis of a 360-day
year consisting of twelve 30 day months, from April 30, 2001 at a rate of 7.25%
per annum, payable on January 15, April 15, July 15 and October 15 of each year,
the first payment to be made on July 15, 2001, to the person in whose name the
Bonds are registered at the close of business on the last day of the month
preceding such January 15, April 15, July 15 or October 15.
If any January 15, April 15, July 15 or October 15 falls on a day that is
not a Business Day, then payment of interest will be made on the next succeeding
Business Day with the same force and effect as if made on such date.
The Bonds will be issued in book-entry form. See "Book-Entry, Delivery and
Form" in the accompanying prospectus.
We may from time to time, without notice to or the consent of the
registered holders of the Bonds, create and issue further Bonds ranking pari
passu with the Bonds in all respects, or in all respects except for the payment
of interest accruing prior to the issue date of such further Bonds or except for
the first payment of interest following the issue date of such further Bonds.
Such further Bonds may be consolidated and form a single series with the Bonds
and have the same terms as to status, redemption or otherwise as the Bonds.
S-4
Optional Redemption
We may not redeem the Bonds before April 30, 2006, except for tax reasons
as described below under " Redemption for Tax Reasons." On and after April 30,
2006, we may redeem the Bonds, at our option and at any time, in whole or in
part at a redemption price equal to 100% of their principal amount plus accrued
and unpaid interest up to but not including the date of redemption.
Redemption for Tax Reasons
We may elect to redeem the Bonds, in whole but not in part, at any time at
a redemption price of 100% of their principal amount, plus accrued and unpaid
interest up to but not including the redemption date, if on or after April 30,
2001, a change in the U.S. tax laws results in a substantial likelihood that we
will not be able to deduct the full amount of interest accrued on the Bonds for
U.S. federal income tax purposes.
The Bonds describe a change in tax laws broadly and permit us to redeem
because of:
o any actual or proposed change in or amendment to the laws of the U.S.
or regulations or rulings promulgated under those laws;
o any change in the way those laws, rulings or regulations are
interpreted, applied or enforced;
o any action taken by a taxing authority that applies to us;
o any court decision, whether or not in a proceeding involving us; or
o any technical advice memorandum, letter ruling or administrative
pronouncement issued by the U.S. Internal Revenue Service, based on a
fact pattern substantially similar to ours.
Selection and Notice
We will mail notices of redemption by first-class mail at least 30 and not
more than 60 days prior to the date fixed for redemption to each registered
holder of the Bonds to be redeemed at its registered address. If we redeem less
than all of the Bonds at any time, the trustee will select the Bonds to be
redeemed on a pro rata basis, by lot or by such other method directed by us. The
trustee will make that selection not more than 45 days before the redemption
date.
Trading Characteristics
We expect the Bonds to trade at a price that takes into account the value,
if any, of accrued but unpaid interest. This means that purchasers will not pay,
and sellers will not receive, accrued and unpaid interest on the Bonds that is
not included in their trading price. Any portion of the trading price of a Bond
that is attributable to accrued interest will be treated as ordinary interest
income for federal income tax purposes and will not be treated as part of the
amount realized for purposes of determining gain or loss on the disposition of
the Bonds. See "U.S. Tax Considerations" below.
S-5
U.S. TAX CONSIDERATIONS
The following summary describes the material U.S. federal income and
certain estate tax consequences of ownership and disposition of the Bonds to an
initial investor purchasing a Bond at its "issue price" that is, the first price
to the public at which a substantial amount of the Bonds in an issue is sold
(excluding sales to bond houses, brokers or similar persons or organizations
acting in the capacity of underwriters, placement agents or wholesalers). This
summary is based on the Internal Revenue Code of 1986, as amended to the date
hereof (the "Code"), administrative pronouncements, judicial decisions and
existing and proposed Treasury regulations, and interpretations of the
foregoing, changes to any of which subsequent to the date of this prospectus
supplement may affect the tax consequences described herein, possibly with
retroactive effect. This summary discusses only Bonds held as capital assets
within the meaning of Section 1221 of the Code. It does not discuss all of the
tax consequences that may be relevant to holders in light of their particular
circumstances or to holders subject to special rules, such as certain financial
institutions, insurance companies, dealers in securities, partnerships or other
entities classified as partnerships for U.S. federal income tax purposes,
persons holding Bonds in connection with a hedging transaction, "straddle,"
conversion transaction or other integrated transaction, or persons who have
ceased to be U.S. citizens or to be taxed as resident aliens.
Prospective investors should consult their tax advisers with regard to the
application of U.S. federal tax laws to their particular situations, as well as
any tax consequences arising under the laws of any state, local or foreign
taxing jurisdiction.
U.S. Holders
"U.S. Holder" means a beneficial owner of a Bond that is, for U.S. federal
income tax purposes, (i) a citizen or resident of the U.S., (ii) a corporation
or other entity treated as a corporation for U.S. federal income tax purposes,
created or organized in or under the laws of the U.S. or any political
subdivision, (iii) an estate the income of which is subject to U.S. federal
income taxation regardless of its source, (iv) a trust if (a) a court within the
United States is able to exercise primary supervision over the administration of
the trust and (b) one or more United States persons have the authority to
control all substantial decisions of the trust, or (v) any other holder whose
income with respect to a Bond is effectively connected with such holder's
conduct of a U.S. trade or business.
Payments of Interest
Stated interest on a Bond will be taxable to a U.S. Holder as ordinary
interest income at the time it accrues or is received in accordance with the
U.S. Holder's method of accounting for tax purposes.
Sale, Exchange or Retirement
Upon the sale, exchange or retirement of a Bond, a U.S. Holder will
recognize taxable gain or loss equal to the difference between the U.S. Holder's
adjusted tax basis in the Bond and the amount realized on the sale, exchange or
retirement. For these purposes, the amount realized does not include unpaid
interest that has accrued to the date of sale but has not previously been
included in income. (See "Description of the Bonds --- Trading
Characteristics.") Such amounts are treated as interest as described under
"Payment of Interest" above.
S-6
A U.S. Holder's adjusted tax basis in a Bond will generally equal the cost
of the Bond to the U.S. Holder. Gain or loss realized on the sale, exchange or
retirement of a Bond will be capital gain or loss. Prospective investors should
consult their tax advisers regarding the treatment of capital gains (which may
be taxed at lower rates than ordinary income for taxpayers who are individuals,
trusts or estates and have held their Bonds for more than one year) and losses
(the deductibility of which is subject to limitations).
Non-U.S. Holders
"Non-U.S. Holder" means a beneficial owner of a Bond that is, for U.S.
federal income tax purposes, (i) a nonresident alien individual, (ii) a foreign
corporation or (iii) a nonresident alien fiduciary of a foreign estate or trust.
Under present U.S. federal tax law, and subject to the discussion below
concerning backup withholding:
(a) Payments of principal, interest and premium on the Bonds to any Non-U.S.
Holder will be exempt from the 30% U.S. federal withholding tax, provided
that in the case of interest, the Non-U.S. Holder does not own, actually or
constructively, 10% or more of the total combined voting power of all
classes of our stock entitled to vote, is not a controlled foreign
corporation related, directly or indirectly, to us through stock ownership,
and is not a bank receiving certain types of interest. Interest will not,
however, be exempt from withholding tax unless the beneficial owner of the
Bond certifies generally on Internal Revenue Service ("IRS") Form W-8BEN
under penalties of perjury that it is not a U.S. person. Prospective
investors, including foreign partnerships and their partners should consult
their tax advisers regarding possible additional reporting requirements;
(b) a Non-U.S. Holder of a Bond will not be subject to U.S. federal income tax
on gain realized on the sale, exchange or other disposition of the Bond,
unless (i) the Non-U.S. Holder is an individual who is present in the U.S.
for 183 days or more in the taxable year of the disposition, and either the
gain is attributable to an office or other fixed place of business
maintained by the individual in the U.S. or, generally, the individual has
a "tax home" in the U.S. or (ii) the gain is effectively connected with the
Holder's conduct of a trade or business in the U.S.; and
(c) a Bond held by an individual who is not, for U.S. estate tax purposes, a
resident or citizen of the U.S. at the time of his death generally will not
be subject to U.S. federal estate tax as a result of the individual's
death, provided that the individual does not own, actually or
constructively, 10% or more of the total combined voting power of all
classes of our stock entitled to vote and, at the time of the individual's
death, payments with respect to the Bond would not have been effectively
connected to the conduct by the individual of a trade or business in the
U.S.
If a Non-U.S. Holder of a Bond is engaged in a trade or business in the U.S.,
and if interest on the Bond (or gain realized on its sale, exchange or other
disposition) is effectively connected with the conduct of the trade or
business, the Non-U.S. Holder, although exempt from the withholding tax
discussed in the preceding paragraphs, will be subject to regular U.S. income
S-7
tax on the effectively connected income, generally in the same manner as if it
were a U.S. Holder. See "U.S. Holders" above. In lieu of Form W-8BEN, the
non-U.S. Holder will be required to provide to the withholding agent a properly
executed IRS Form W-8ECI to claim an exemption from withholding tax. In
addition, if the Non-U.S. Holder is a foreign corporation, it may be subject to
a 30% branch profits tax (unless reduced or eliminated by an applicable treaty)
on its earnings and profits for the taxable year attributable to the
effectively connected income, subject to certain adjustments.
Backup Withholding and Information Reporting
U.S. Holders
A 31% backup withholding tax and information reporting requirements apply
to certain payments of principal of and interest on an obligation, and to
proceeds of disposition of an obligation, to certain noncorporate U.S. Holders
if such holders fail to provide correct taxpayer identification numbers and
other information or fail to comply with certain other requirements. We, our
paying agent, or a broker, as the case may be, will be required to withhold from
any payment that is subject to backup withholding a tax equal to 31% of such
payment unless the holder furnishes its taxpayer identification number in the
manner prescribed in applicable Treasury regulations (generally on an IRS Form
W-9) and certain other conditions are met.
Non-U.S. Holders
Backup withholding will not apply to payments of interest made on a Bond
or to proceeds from a sale or other disposition of a Bond if the certifications
required to claim the exemption from withholding tax or interest described above
are received, provided that we or our paying agent, as the case may be, do not
have actual knowledge that the payee is a U.S. person.
Holders of Bonds should consult their tax advisers regarding the
application of information reporting and backup withholding in their particular
situations, the availability of an exemption therefrom and the procedure for
obtaining such an exemption, if available. Backup withholding is not an
additional tax. Any amounts withheld from a payment to a holder under the backup
withholding rules will be allowed as a credit against such holder's U.S. federal
income tax liability and may entitle the holder to a refund, provided that the
required information is furnished to the IRS.
S-8
UNDERWRITING
Subject to the terms and conditions set forth in an underwriting agreement
dated April 20, 2001 (the "Underwriting Agreement"), we have agreed to sell to
each of the underwriters named below, and each of the underwriters, for whom
Morgan Stanley & Co. Incorporated is acting as representative (the
"Representative"), has severally agreed to purchase the principal amount of the
Bonds set forth opposite its name below. In the Underwriting Agreement, the
several underwriters have agreed, subject to the terms and conditions set forth
therein, to purchase all the Bonds offered hereby if any of the Bonds are
purchased.
Principal Amount
Underwriters of Bonds
------------------ ----------------
Morgan Stanley & Co. Incorporated.................... $ 49,650,000
ABN AMRO Incorporated ............................... 49,575,000
A.G. Edwards & Sons, Inc. ........................... 49,575,000
Banc One Capital Markets, Inc........................ 49,575,000
CIBC World Markets Corp.............................. 49,575,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated............................. 49,575,000
Prudential Securities Incorporated................... 49,575,000
Salomon Smith Barney Inc............................. 49,575,000
UBS Warburg LLC ..................................... 49,575,000
Banc of America Securities LLC ...................... 2,500,000
Bear, Stearns & Co. Inc.............................. 2,500,000
Credit Suisse First Boston Corporation............... 2,500,000
Dain Rauscher Wessels................................ 2,500,000
Deutsche Bank Alex. Brown Inc. ...................... 2,500,000
First Union Securities, Inc. ........................ 2,500,000
H&R BLOCK Financial Advisors, Inc. .................. 2,500,000
HSBC Securities (USA) Inc............................ 2,500,000
Chase Securities Inc. ............................... 2,500,000
Lehman Brothers Inc. ................................ 2,500,000
Quick & Reilly, Inc.................................. 2,500,000
Charles Schwab & Co., Inc............................ 2,500,000
U.S. Bancorp Piper Jaffray Inc. ..................... 2,500,000
Wachovia Securities, Inc............................. 2,500,000
Advest Inc........................................... 1,250,000
Robert W. Baird & Co. Incorporated................... 1,250,000
BNY Capital Markets, Inc............................. 1,250,000
BB&T Capital Markets, a Division of Scott &
Stringfellow..................................... 1,250,000
William Blair & Co................................... 1,250,000
Blaylock & Partners, L.P............................. 1,250,000
Comerica Securities, Inc............................. 1,250,000
Crowell, Weedon & Co................................. 1,250,000
Davenport & Company LLC ............................. 1,250,000
D.A. Davidson & Co. ................................. 1,250,000
Fahnestock & Co. Inc................................. 1,250,000
Fifth Third Securities Inc........................... 1,250,000
Gibraltar Securities Co. ............................ 1,250,000
Gruntal & Co., L.L.C. ............................... 1,250,000
Guzman & Company..................................... 1,250,000
J.J.B. Hilliard, W.L. Lyons, Inc. ................... 1,250,000
Janney Montgomery Scott LLC. ........................ 1,250,000
Josephthal & Co. Inc................................. 1,250,000
Legg Mason Wood Walker, Inc.......................... 1,250,000
McDonald Investments Inc., a KeyCorp Company......... 1,250,000
Mesirow Financial, Inc. ............................. 1,250,000
Northern Trust Securities, Inc....................... 1,250,000
Parker/Hunter Incorporated........................... 1,250,000
S-9
Pershing/a Division of Donaldson, Lufkin & Jenrette.. 1,250,000
Ragen McKenzie, a Division of Wells Fargo
Investments LLC.................................. 1,250,000
Raymond James & Associates, Inc...................... 1,250,000
The Robinson-Humphrey Company, LLC................... 1,250,000
Muriel Siebert & Co. Inc............................. 1,250,000
Southwest Securities, Inc............................ 1,250,000
Stifel, Nicolaus & Company Incorporated.............. 1,250,000
SunTrust Equitable Securities........................ 1,250,000
TD Securities (USA) Inc.............................. 1,250,000
Tucker Anthony Incorporated.......................... 1,250,000
Well Fargo/Van Kasper & Co........................... 1,250,000
The Williams Capital Group, L.P...................... 1,250,000
------------
Total........................................... $525,000,000
============
The Representative of the underwriters has advised us that the
underwriters propose initially to offer the Bonds to the public at the offering
price set forth on the cover page of this prospectus supplement and to certain
securities dealers at such price less a concession of $0.50 per Bond. The
underwriters may allow, and such dealers may reallow a concession not in excess
of $0.45 per Bond to certain brokers and dealers. After the initial public
offering, the public offering price and concession may be changed.
We have granted the underwriters a right to request from us the
opportunity to purchase up to an additional $50,000,000 aggregate principal
amount of Bonds to cover overallotments, if any, at the initial offering price
to the public less the underwriting discounts set forth above and within 30 days
from the date of this prospectus supplement. Whether or not to approve the
underwriters' request is totally at our discretion. To the extent that we
approve of the exercise of such option and the underwriters exercise such
option, each of the underwriters will have a firm commitment, subject to certain
conditions, to purchase from us approximately the same percentages of the
aggregate principal amount of Bonds as the amount set forth next to such
underwriter's name in the above table bears to the aggregate principal amount of
Bonds set forth as the total to be purchased in the above table.
We have agreed to indemnify the underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, as amended.
Prior to the offering, there has been no public market for the Bonds. We
intend to list the Bonds on the New York Stock Exchange, and we expect trading
in the Bonds on the New York Stock Exchange to begin within 30 days after the
original issue date. In order to meet one of the requirements for listing the
Bonds, the underwriters will undertake to sell lots of 100 or more Bonds to a
minimum of 400 beneficial holders.
The Bonds are a new issue of securities with no established trading
market. The underwriters have advised us that the underwriters intend to make a
market in the Bonds but are not obligated to do so and may discontinue market
making at any time without notice. Neither we nor the underwriters can assure
you that the trading market for the Bonds will be liquid.
In connection with the sale of the Bonds, certain of the underwriters may
engage in transactions that stabilize, maintain or otherwise affect the price of
the Bonds. Specifically, the underwriters may overallot the offering, creating a
short position. In addition, the underwriters may bid for and purchase the Bonds
in the open market to cover short positions or to stabilize the price of the
Bonds. Any of these activities may stabilize or maintain the market price of the
Bonds above independent market levels. The underwriters will not be required to
engage in these activities, and may end any of these activities at any time.
S-10
We will deliver the Bonds to the underwriters at the closing of this
offering when the underwriters pay us the purchase price of the Bonds. The
underwriting agreement provides that the closing will occur on April 30, 2001,
which is six business days after the date of this prospectus supplement. Rule
15c6-1 under the Securities Exchange Act of 1934 generally requires that
securities trades in the secondary market settle in three business days, unless
the parties to a trade expressly agree otherwise.
John H. Bryan, a director of Bank One Corporation, of which Banc One
Capital Markets, Inc. is a direct wholly-owned subsidiary, is a director of GM.
In the ordinary course of their respective businesses, the agents and their
affiliates have engaged, and will in the future engage, in commercial banking
and investment banking transactions with GM and certain of our affiliates for
which they have received customary fees and expenses.
LEGAL OPINIONS
The validity of the Bonds offered pursuant to this prospectus supplement
will be passed on for GM by Martin I. Darvick, Esq., Attorney, GM Legal Staff,
and for the underwriters by Davis Polk & Wardwell. Mr. Darvick owns shares, and
has options to purchase shares, of General Motors Corporation common stock, $1
2/3 par value and owns shares of General Motors Corporation Class H common
stock, $0.10 par value.
The firm of Davis Polk & Wardwell acts as counsel to the Executive
Compensation Committee of our Board of Directors and has acted as our counsel
and as counsel for certain of our subsidiaries in various matters.
S-11
PROSPECTUS
GENERAL MOTORS CORPORATION
DEBT SECURITIES
WARRANTS TO PURCHASE DEBT SECURITIES
General Motors Corporation (the "Corporation" or "General Motors"),
directly, through agents designated from time to time, or through dealers or
underwriters also to be designated, may offer from time to time its debt
securities (the "Debt Securities") and/or its warrants (the "Warrants") to
purchase any of the Debt Securities, for issuance and sale, at an aggregate
initial offering price not to exceed $3,000,000,000 or the equivalent thereof in
other currencies, including composite currencies such as the European Currency
Unit ("ECU") (the "Specified Currency"), on terms to be determined at the time
of sale. The Debt Securities and the Warrants are herein collectively called the
"Securities." The Securities may be offered either together or separately and in
one or more series, in amounts, at prices and on terms to be set forth in
supplements to this Prospectus. The Securities may be sold for U.S. dollars or
the Specified Currency and the principal of and any premium and interest on the
Securities may likewise be payable in U.S. dollars or the Specified Currency.
The Specified Currency for which the Securities may be purchased and the
Specified Currency in which principal of and any premium and interest on the
Securities may be payable are set forth in the accompanying Prospectus
Supplement (the "Prospectus Supplement").
The Debt Securities will be issued in fully registered definitive form
("Certificated Securities") or in the form of global securities which may be
held and registered only in the name of a depositary institution ("Book-Entry
Securities").
The terms of the Debt Securities, including, where applicable, the specific
designation, aggregate principal amount, authorized denominations, purchase
price, maturity, interest rate (which may be fixed or variable) and time of
payment of interest, if any, any redemption or repayment terms, and the
Specified Currency in which the Debt Securities shall be payable (and similar
information with respect to the Debt Securities purchasable upon exercise of
each Warrant), are set forth in the accompanying Prospectus Supplement (the
"Prospectus Supplement"). Where Warrants are to be offered, a Prospectus
Supplement shall set forth the offering price and terms of the Warrants,
including the purchase price, exercise price or prices, detachability,
expiration date or dates, exercise period or periods, the Specified Currency in
which such Warrants are exercisable, the price or prices, if any, at which the
Warrants may be redeemed at the option of the holder or will be redeemed upon
expiration, and the Warrant Agent acting under the Warrant Agreement pursuant to
which the Warrants are to be issued.
The Securities may be sold directly by the Corporation, through agents of
the Corporation designated from time to time, or through underwriters or
dealers, or through a combination of such methods. If any agents, underwriters
or dealers are involved in the sale of the Securities, the names of such agents,
underwriters or dealers and any applicable commissions or discounts are set
forth in the accompanying Prospectus Supplement. Any Agents, underwriters or
dealers participating in the offering may be deemed "underwriters" within the
meaning of the Securities Act of 1933, as amended. See "Plan of Distribution"
for possible indemnification arrangements for the agents, underwriters and
dealers. The Corporation reserves the sole right to accept and, together with
its agents from time to time, to reject in whole or in part any proposed
purchase of Securities to be made directly or through agents.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is August 19, 1998
No dealer, salesman or any other person has been authorized to give any
information or to make any representations not contained or incorporated by
reference in this Prospectus, Prospectus Supplement, and Pricing Supplement, if
any, and, if given or made, such information or representation must not be
relied upon as having been authorized by the Corporation or by any agent,
underwriter or dealer. Neither the delivery of this Prospectus, Prospectus
Supplement and Pricing Supplement, if any, nor any sale made thereunder shall,
under any circumstances, create any implication that the information therein is
correct at any time subsequent to the date thereof. This Prospectus, Prospectus
Supplement and Pricing Supplement, if any, shall not constitute an offer to sell
or a solicitation of an offer to buy any of the Securities offered hereby by
anyone in any jurisdiction in which such offer or solicitation is not authorized
or in which the person making such offer or solicitation is not qualified to do
so or to any person to whom it is unlawful to make such offer or solicitation.
AVAILABLE INFORMATION
The Corporation is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected, and copies may be obtained at
the Public Reference Section of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates, as well as at the following
Regional Offices of the Commission: Citicorp Center, 500 Madison Street, Suite
1400, Chicago, Illinois 60661-2511 and Seven World Trade Center, Suite 1300, New
York, New York 10048. Such material may also be accessed electronically by means
of the Commission's home page on the Internet at http://www.sec.gov. Reports,
proxy statements and other information concerning the Corporation can also be
inspected at the offices of the New York Stock Exchange, Inc., 20 Broad Street,
New York, New York 10005, where the Corporation's Common Stock, $1-2/3 Par Value
and Class H Common Stock, $.10 par value, are listed and at the offices of the
following other stock exchanges where the Corporation's Common Stock, $1-2/3 Par
Value, is listed in the United States: the Chicago Stock Exchange, Inc., One
Financial Place, 440 South LaSalle Street, Chicago, Illinois 60605, the Pacific
Stock Exchange, Inc., 233 South Beaudry Avenue, Los Angeles, California 90012
and 301 Pine Street, San Francisco, California 94104, and the Philadelphia Stock
Exchange, Inc., 1900 Market Street, Philadelphia, Pennsylvania 19103.
The Prospectus constitutes a part of a Registration Statement filed by the
Corporation with the Commission under the Securities Act of 1933, as amended
(the "Securities Act of 1933"). This Prospectus omits certain of the information
contained in the Registration Statement in accordance with the rules and
regulations of the Commission. Reference is hereby made to the Registration
Statement and related exhibits for further information with respect to the
Corporation and the Securities. Statements contained herein concerning the
provisions of any document are not necessarily complete and, in each instance,
reference is made to the copy of such document filed as an exhibit to the
Registration Statement or otherwise filed with the Commission. Each such
statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Corporation's Annual Report on Form 10-K for the year ended December
31, 1997, as amended, Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1998 and June 30, 1998 and Reports on Form 8-K dated January 9, 1998,
January 26, 1998, February 9, 1998, March 2, 1998, April 16, 1998, June 5, 1998,
June 8, 1998, July 8, 1998, July 9, 1998, July 14, 1998(2), August 3, 1998 and
August 17, 1998, filed with the Commission pursuant to Section 13 or 15(d) of
the Exchange Act are incorporated by reference in this Prospectus.
All documents filed by the Corporation with the Commission pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of
this Prospectus and prior to the termination of the offering of the Securities
shall be deemed to be incorporated by reference in this Prospectus and to be a
part thereof from the date of filing of such documents. Any statement contained
in a document incorporated or deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes of this Prospectus to
the extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
1
THE CORPORATION WILL PROVIDE WITHOUT CHARGE UPON WRITTEN OR ORAL REQUEST,
TO EACH PERSON TO WHOM THIS PROSPECTUS IS DELIVERED, A COPY OF ANY OR ALL OF THE
DOCUMENTS DESCRIBED ABOVE WHICH HAVE BEEN OR MAY BE INCORPORATED BY REFERENCE IN
THIS PROSPECTUS, OTHER THAN EXHIBITS TO SUCH DOCUMENTS. SUCH REQUEST SHOULD BE
DIRECTED TO:
GENERAL MOTORS CORPORATION
MAIL CODE: 482-111-238
3044 WEST GRAND BOULEVARD
DETROIT, MICHIGAN 48202-3091
(TELEPHONE NUMBER: (313) 556-2044)
GENERAL MOTORS CORPORATION
While the major portion of General Motors operations is derived from the
automotive industry, General Motors also has financing and insurance operations
and produces products and provides services in other industries. General Motors
participates in the automotive industry through the activities of its automotive
business operating segments: General Motors-North American Operations (GM-NAO);
Delphi Automotive Systems (Delphi); and General Motors International Operations
(GMIO). GM-NAO designs, manufactures and markets vehicles primarily in North
America under the following nameplates: Chevrolet, Pontiac, GMC, Oldsmobile,
Buick, Cadillac and Saturn. Delphi is a diverse supplier of automotive systems
and components. Delphi offers products and services in the areas of chassis,
interior, lighting, electronics, power and signal distribution, energy and
engine management, steering and thermal systems. GMIO meets the demands of
customers outside North America with vehicles designed, manufactured and
marketed under the following nameplates: Opel, Vauxhall, Holden, Isuzu, Saab,
Chevrolet, GMC and Cadillac. General Motors financing and insurance operations
primarily relate to General Motors Acceptance Corporation (GMAC). GMAC provides
a broad range of financial services, including consumer vehicle financing,
full-service leasing and fleet leasing, dealer financing, car and truck extended
service contracts, residential and commercial mortgage services, and vehicle and
homeowners insurance. GM's other operations relate to its Hughes Electronics
Corporation subsidiary, which is the telecommunications and space business, and
the design, manufacturing and marketing of locomotives and heavy-duty
transmissions.
General Motors principal executive offices are located at 200 Renaissance
Center, Detroit, Michigan 48265-2000 (Telephone Number (313) 556-5000).
USE OF PROCEEDS
Unless otherwise set forth in the applicable Prospectus Supplement, net
proceeds from the sale of the Securities will be used for general Corporate
purposes, including the repayment of existing indebtedness.
2
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the consolidated ratio of earnings from
continuing operations to fixed charges for the Corporation for the periods
indicated.
SIX MONTHS
ENDED
JUNE 30 YEARS ENDED DECEMBER 31
----------------- ---------------------------------------
1998 1997 1997 1996 1995 1994 1993
---- ---- ---- ---- ---- ---- ----
1.87 2.93 2.21 2.10 2.39 2.35 1.26
The ratio of earnings to fixed charges has been computed by dividing
earnings before income taxes and fixed charges by the fixed charges. This ratio
includes the earnings and fixed charges of the Corporation and its consolidated
subsidiaries; fixed charges consist of interest and discount and the portion of
rentals for real and personal properties in an amount deemed to be
representative of the interest factor.
DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the Debt Securities sets forth
certain general terms and provisions of the Debt Securities to which any
Prospectus Supplement may relate. The particular terms of the Debt Securities in
respect of which this Prospectus is being delivered and the extent, if any, to
which such general provisions may not apply thereto will be described in the
Prospectus Supplement relating to such Debt Securities.
The Debt Securities offered hereby are to be issued under an Indenture (the
"Indenture"), dated as of December 7, 1995, between the Corporation and
Citibank, N.A., as Trustee (the "Trustee"), a copy of which is filed as an
exhibit to the Registration Statement. The following statements are subject to
the detailed provisions of the Indenture. Numerical references in parentheses
below are to sections in the Indenture. Wherever particular provisions of the
Indenture are referred to, such provisions are incorporated by reference as a
part of the statements made, and the statements are qualified in their entirety
by such reference. Capitalized terms used in this description but not defined
herein have the meanings provided in the Indenture.
The Indenture provides that, in addition to the Debt Securities offered
hereby, additional Debt Securities may be issued thereunder without limitation
as to aggregate principal amount, except as authorized from time to time by the
Corporation's Board of Directors. (Section 2.01 of the Indenture.)
GENERAL
Reference is made to the Prospectus Supplement relating to the particular
series of Debt Securities offered thereby for the following terms of the Debt
Securities (to the extent such terms are applicable to such Debt Securities):
(i) the designation of such Debt Securities;
(ii) the authorized denominations and the aggregate principal amount of
such Debt Securities;
(iii)the percentage of their principal amount at which such Debt
Securities will be issued;
(iv) the date or dates on which such Debt Securities will mature (or the
manner of determining the same);
(v) the rate or rates per annum, if any, which may be fixed or variable,
at which such Debt Securities will bear interest, if any, and, if the
rate is variable, the manner of calculation thereof;
(vi) the date or dates from which interest, if any, shall accrue or the
method by which such date or dates shall be determined and the date or
dates at which such interest, if any, will be payable and the record
dates therefor;
3
(vii)the period or periods within which, the terms and conditions upon
which, such Debt Securities may be redeemed and the redemption price
or prices;
(viii) any mandatory or optional sinking fund or analogous provisions;
(ix) the provisions, if any, for the defeasance of the Debt Securities;
(x) the form (registered or bearer) in which Debt Securities may be
issued, any restrictions applicable to the exchange of one form for
another and to the offer, sale and delivery of Debt Securities in
either form;
(xi) whether and under what circumstances the Corporation will pay
additional amounts (the "Additional Amounts") on Debt Securities held
by a person who is not a United States person (as defined in the
Prospectus Supplement) in respect of specified taxes, assessments or
other governmental charges withheld or deducted, and if so, whether
the Corporation has the option to redeem the affected Debt Securities
rather than pay such Additional Amounts;
(xii)the Specified Currency for which such Debt Securities may be
purchased and the Specified Currency in which the principal of, and
premium, if any, and interest, if any, on, such Debt Securities may be
payable;
(xiii) the exchanges, if any, on which such Debt Securities may be listed;
(xiv)whether such Debt Securities are to be issued in book-entry form and,
if so, the identify of the Depositary for such book-entry Securities;
(xv) the place or places where the principal of, premium, if any, and
interest, if any, on the Debt Securities will be payable; and
(xvi)any other specific terms of the Debt Securities, including any
additional covenants applicable to such Debt Securities and any terms
which may be required or advisable under applicable laws or
regulations. (Sections 2.04 and 4.02 of the Indenture.)
The Debt Securities will be unsecured and will rank equally and ratably
with all other unsecured and unsubordinated indebtedness of the Corporation
(other than obligations preferred by mandatory provisions of law).
Unless otherwise specified in a Prospectus Supplement, principal, premium,
if any, interest, if any, and Additional Amounts, if any, will be payable, and,
unless the Debt Securities are issued in book-entry form, the Debt Securities
offered hereby will be transferable, at the office of the Trustee, 111 Wall
Street, New York, New York 10043, provided that payment of interest may be made
at the option of the Corporation by check mailed to the address of the person
entitled thereto. Principal of and premium, if any, interest, if any, and
Additional Amounts, if any, on Debt Securities in bearer form, and coupons
appertaining thereto (the "Coupons"), if any, will be payable against surrender
of such Debt Securities or Coupons, as the case may be, subject to any
applicable laws and regulations, at such paying agencies outside the United
States as the Corporation may appoint from time to time at the places and
subject to the restrictions set forth in the Indenture, the Debt Securities and
the Prospectus Supplement. (Section 4.02 of the Indenture.) Debt Securities in
bearer form and the Coupons, if any, appertaining thereto will be transferable
by delivery. No service charge will be made for any transfer or exchange of such
Debt Securities, but the Corporation may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
(Section 2.05 of the Indenture.)
Debt Securities may be issued, from time to time, with the principal amount
payable on any principal payment date, or the amount of interest payable on any
interest payment date, to be determined by reference to one or more currency
exchange rates, commodity prices, equity indices or other factors. Holders of
such Debt Securities may receive a principal amount on any principal payment
date, or a payment of interest on any interest payment date, that is greater
than or less than the amount of principal or interest otherwise payable on such
dates, depending upon the value on such dates of the applicable currencies,
commodities, equity indices or other factors. Information as to the methods for
determining the amount of principal or interest payable on any date, the
currencies, commodities, equity indices or other factors to which the amount
payable on such date is linked and certain additional United States Federal
income tax considerations will be set forth in the Prospectus Supplement
relating thereto.
4
As used herein, the term Debt Securities shall include Debt Securities
denominated in United States dollars or, at the option of the Corporation if so
specified in the applicable Prospectus Supplement, in any other freely
transferable currency or units based on or relating to foreign currencies,
including European Currency Units.
If a Prospectus Supplement specifies that Debt Securities are denominated
in a currency or currency unit other than United States dollars, such Prospectus
Supplement shall also specify the denominations in which such Debt Securities
will be issued and the coin or currency in which the principal, premium, if any,
and interest, if any, on such Debt Securities, will be payable, which may be
United States dollars based upon the exchange rate for such other currency
existing on or about the time a payment is due.
Some of the Debt Securities may be issued as discounted Debt Securities
(bearing no interest or interest at a rate which at the time of issuance is
below market rates) to be sold at a substantial discount below their stated
principal amount. Special considerations applicable to the Debt Securities of
any series, including any United States Federal income tax consequences
applicable to any discounted Debt Securities or to certain Debt Securities
issued at par which are treated as having been issued at discount or to Debt
Securities denominated or payable in foreign currencies or currency units, will
be described in the Prospectus Supplement relating thereto.
If a Prospectus Supplement specifies that the Debt Securities will have a
redemption option, the "Option to Elect Repurchase" constitutes an issuer tender
offer under the Exchange Act. The Corporation will comply with all issuer tender
offer rules and regulations under the Exchange Act, including Rule 14e-1, if
such redemption option is elected, including making any required filings with
the Commission and the furnishing of certain information to the holders of the
Debt Securities.
BOOK-ENTRY SECURITIES - DELIVERY AND FORM
Unless otherwise indicated in the Prospectus Supplement, the Debt
Securities will be issued in the form of one or more fully registered global
securities (collectively, the "Registered Global Debt Securities") which will be
deposited with or on behalf of The Depository Trust Corporation ("DTC") or other
depositary (DTC or such other depositary as is specified in the applicable
Prospectus Supplement is herein referred to as the "Depositary") and registered
in the name of the Depositary or the Depositary's nominee. No single Registered
Global Security shall exceed U.S.$200,000,000. Except as set forth below, the
Registered Global Debt Securities may be transferred, in whole and not in part,
only to another nominee of the Depositary or to a successor of the Depositary or
its nominee.
DTC has advised the Corporation that it is a limited-purpose trust company
organized under the laws of the State of New York, a member of the Federal
Reserve System, a "clearing corporation" within the meaning of the New York
Uniform Commercial Code and a "clearing agency" registered under the Exchange
Act. DTC was created to hold securities of its participants and to facilitate
the clearance and settlement of securities transactions among its participants
in such securities through electronic book-entry changes in accounts of the
participants, thereby eliminating the need for physical movement of securities
certificates. DTC's participants include securities brokers and dealers
(including the agents and/or underwriters named in any Prospectus Supplement),
banks, trust companies, clearing corporations and certain other organizations,
some of whom (and/or their representatives) own DTC. Access to DTC's book-entry
system is also available to others, such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a
participant, either directly or indirectly. Persons who are not participants may
beneficially own securities held by DTC only through participants. The rules
applicable to DTC and its participants are on file with the Commission.
5
Upon the issuance by the Corporation of Securities represented by a
Registered Global Debt Security, the Depositary will credit, on its book-entry
registration and transfer system, the participants' accounts with, the
respective principal amounts of the Securities represented by such Registered
Global Debt Security beneficially owned by such participants. The accounts to be
credited shall be designated by the agents, underwriters or dealers
participating in the distribution of such Securities, or the Corporation, if
such Securities are offered and sold directly by the Corporation, as the case
may be. Ownership of beneficial interests in a Registered Global Debt Security
will be limited to participants or persons that hold interests through
participants. Ownership of beneficial interests in Securities represented by a
Registered Global Debt Security will be shown on, and the transfer of that
ownership will be effected only through, records maintained by the Depositary
(with respect to interests of participants in the Depositary), or by
participants in the Depositary or persons that may hold interests through such
participants (with respect to persons other than participants in the
Depositary). The laws of some states require that certain purchasers of
securities take physical delivery of such securities in definitive form. Such
limits and such laws may impair the ability to transfer beneficial interests in
a Registered Global Debt Security.
So long as the Depositary for a Registered Global Debt Security, or its
nominee, is the registered owner of the Registered Global Debt Security, the
Depositary or its nominee, as the case may be, will be considered the sole owner
or holder of the Book-Entry Securities represented by such Registered Global
Debt Security for all purposes under the Indenture. Except as provided below,
owners of beneficial interests in Book-Entry Securities represented by a
Registered Global Debt Security or Securities will not be entitled to have
Book-Entry Securities represented by such Registered Global Debt Securities
registered in their names, will not receive or be entitled to receive physical
delivery of Book-Entry Securities in definitive form and will not be considered
the owners or holders thereof under the Indenture.
Accordingly, each person owning a beneficial interest in a Registered
Global Debt Security must rely on the procedures of the Depositary and, if such
person is not a participant, on the procedures of the participant through which
such person owns its interest, to exercise any rights of a holder under the
Indenture or a Registered Global Debt Security. The Corporation understands that
under existing policy of the Depositary and industry practices, in the event
that the Corporation requests any action of holders or that an owner of a
beneficial interest in such a Registered Global Debt Security desires to give
any notice or take any action which a holder is entitled to give or take under
the Indenture or a Registered Global Debt Security, the Depositary would
authorize the participants holding the relevant beneficial interests to give
such notice or take such action. Any beneficial owner that is not a participant
must rely on the contractual arrangements it has directly, or indirectly through
its financial intermediary, with a participant to give such notice or take such
action.
Payments of principal of, premium, if any, and interest, if any, on, the
Securities represented by a Registered Global Debt Security registered in the
name of the Depositary or its nominee will be made by the Corporation through
the Trustee to the Depositary or its nominee, as the case may be, as the
registered owner of a Registered Global Debt Security. None of the Corporation,
the Trustee, any paying agent or any other agent of the Corporation will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of a Registered
Global Debt Security or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests. The Corporation expects that
the Depositary, upon receipt of any payment of principal, premium, if any, or
interest, if any, in respect of a Registered Global Debt Security, will
immediately credit the accounts of the related participants with payment in
amounts proportionate to their respective holdings in principal amount of
beneficial interest in such Registered Global Debt Security as shown on the
records of the Depositary. The Corporation also expects that payments by
participants to owners of beneficial interests in a Registered Global Debt
Security will be governed by standing customer instructions and customary
practices as is now the case with securities held for the accounts of customers
in bearer form or registered in "street name" and will be the responsibility of
such participants.
If the Depositary is at any time unwilling or unable to continue as
depositary or ceases to be a clearing agency under the Exchange Act and a
successor depositary registered as a clearing agency under the Exchange Act is
not appointed by the Corporation within 90 days, the Corporation will issue Debt
6
Securities in definitive form in exchange for all the Registered Global Debt
Securities. In addition, the Corporation may at any time, and in its sole
discretion, determine not to have the Debt Securities represented by the
Registered Global Debt Securities and, in such event, will issue Debt Securities
in definitive form in exchange for all the Registered Global Debt Securities. In
either instance, an owner of a beneficial interest in Registered Global Debt
Securities will be entitled to have Debt Securities equal in principal amount to
such beneficial interest registered in its name and will be entitled to physical
delivery of such Debt Securities in definitive form. Debt Securities so issued
in definitive form will be issued in denominations of $1,000 and integral
multiples thereof and will be issued in registered form only, without Coupons;
however, Medium-Term Notes issued pursuant to a Prospectus Supplement will be
issued in denominations of $100,000 or any amount in excess thereof which is an
integral multiple of $1,000 (or in such other denominations as shall be provided
in an applicable Pricing Supplement) and will be issued in registered form only,
without Coupons. No service charge will be made for any transfer or exchange of
such Debt Securities, but the Corporation may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. (Section 2.05 of the Indenture.)
The Debt Securities of a series may also be issued in the form of one or
more bearer global securities (a "Bearer Global Debt Security") that will be
deposited with a common depositary for the Euroclear System and Cedel Bank,
societe anonyme or with a nominee for such depositary identified in the
Prospectus Supplement relating to such series. The specific terms and
procedures, including the specific terms of the depositary arrangement, with
respect to any portion of a series of Debt Securities to be represented by a
Bearer Global Debt Security will be described in the Prospectus Supplement
relating to such series.
CERTAIN COVENANTS
DEFINITIONS APPLICABLE TO COVENANTS. The following definitions shall be
applicable to the covenants specified below:
(i) "Attributable Debt" means, at the time of determination as
to any lease, the present value (discounted at the actual rate, if
stated, or, if no rate is stated, the implicit rate of interest of such
lease transaction as determined by the chairman, president, any vice
chairman, any vice president, the treasurer or any assistant treasurer
of the Corporation), calculated using the interval of scheduled rental
payments under such lease, of the obligation of the lessee for net
rental payments during the remaining term of such lease (excluding any
subsequent renewal or other extension options held by the lessee). The
term "net rental payments" means, with respect to any lease for any
period, the sum of the rental and other payments required to be paid in
such period by the lessee thereunder, but not including, however, any
amounts required to be paid by such lessee (whether or not designated
as rental or additional rental) on account of maintenance and repairs,
insurance, taxes, assessments, water rates, indemnities or similar
charges required to be paid by such lessee thereunder or any amounts
required to be paid by such lessee thereunder contingent upon the
amount of sales, earnings or profits or of maintenance and repairs,
insurance, taxes, assessments, water rates, indemnities or similar
charges; provided, however, that, in the case of any lease which is
terminable by the lessee upon the payment of a penalty in an amount
which is less than the total discounted net rental payments required to
be paid from the later of the first date upon which such lease may be
so terminated and the date of the determination of net rental payments,
"net rental payments" shall include the then-current amount of such
penalty from the later of such two dates, and shall exclude the rental
payments relating to the remaining period of the lease commencing with
the later of such two dates.
(ii) "Debt" means notes, bonds, debentures or other similar
evidences of indebtedness for money borrowed.
7
(iii) "Manufacturing Subsidiary" means any Subsidiary (A)
substantially all the property of which is located within the
continental United States of America, (B) which owns a Principal
Domestic Manufacturing Property and (C) in which the Corporation's
investment, direct or indirect and whether in the form of equity, debt,
advances or otherwise, is in excess of $2,500,000,000 as shown on the
books of the Corporation as of the end of the fiscal year immediately
preceding the date of determination; provided, however, that
"Manufacturing Subsidiary" shall not include Hughes Electronics
Corporation and its Subsidiaries, General Motors Acceptance Corporation
and its Subsidiaries (or any corporate successor of any of them) or any
other Subsidiary which is principally engaged in leasing or in
financing installment receivables or otherwise providing financial or
insurance services to the Corporation or others or which is principally
engaged in financing the Corporation's operations outside the
continental United States of America.
(iv) "Mortgage" means any mortgage, pledge, lien, security
interest, conditional sale or other title retention agreement or other
similar encumbrance.
(v) "Principal Domestic Manufacturing Property" means any
manufacturing plant or facility owned by the Corporation or any
Manufacturing Subsidiary which is located within the continental United
States of America and, in the opinion of the Board of Directors, is of
material importance to the total business conducted by the Corporation
and its consolidated affiliates as an entity.
(vi) "Subsidiary" means any corporation of which at least a
majority of the outstanding stock having by the terms thereof ordinary
voting power to elect a majority of the board of directors of such
corporation (irrespective of whether or not at the time stock of any
other class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency) is at the
time owned by the Corporation, or by one or more Subsidiaries, or by
the Corporation and one or more Subsidiaries. (Section 4.08 of the
Indenture.)
LIMITATION ON LIENS. For the benefit of the Debt Securities, the Corporation
will not, nor will it permit any Manufacturing Subsidiary to, issue or assume
any Debt secured by a Mortgage upon any Principal Domestic Manufacturing
Property of the Corporation or any Manufacturing Subsidiary or upon any shares
of stock or indebtedness of any Manufacturing Subsidiary (whether such Principal
Domestic Manufacturing Property, shares of stock or indebtedness are now owned
or hereafter acquired) without in any such case effectively providing
concurrently with the issuance or assumption of any such Debt that the Debt
Securities (together with, if the Corporation shall so determine, any other
indebtedness of the Corporation or such Manufacturing Subsidiary ranking equally
with the Debt Securities and then existing or thereafter created) shall be
secured equally and ratably with such Debt, unless the aggregate amount of Debt
issued or assumed and so secured by Mortgages, together with all other Debt of
the Corporation and its Manufacturing Subsidiaries which (if originally issued
or assumed at such time) would otherwise be subject to the foregoing
restrictions, but not including Debt permitted to be secured under clauses (i)
through (vi) of the immediately following paragraph, does not at the time exceed
20% of the stockholders' equity of the Corporation and its consolidated
subsidiaries, as determined in accordance with generally accepted accounting
principles and shown on the audited consolidated balance sheet contained in the
latest published annual report to the stockholders of the Corporation.
The above restrictions shall not apply to Debt secured by:
(i) Mortgages on property, shares of stock or indebtedness of
any corporation existing at the time such corporation becomes a
Manufacturing Subsidiary;
(ii) Mortgages on property existing at the time of acquisition
of such property by the Corporation or a Manufacturing Subsidiary, or
Mortgages to secure the payment of all or any part of the purchase
price of such property upon the acquisition of such property by the
Corporation or a Manufacturing Subsidiary or to secure any Debt
incurred prior to, at the time of, or within 180 days after, the later
of the date of acquisition of such property and the date such property
is placed in service, for the purpose of financing all or any part of
the purchase price thereof, or Mortgages to secure any Debt incurred
for the purpose of financing the cost to the Corporation or a
Manufacturing Subsidiary of improvements to such acquired property;
8
(iii) Mortgages securing Debt of a Manufacturing Subsidiary
owing to the Corporation or to another Subsidiary;
(iv) Mortgages on property of a corporation existing at the
time such corporation is merged or consolidated with the Corporation or
a Manufacturing Subsidiary or at the time of a sale, lease or other
disposition of the properties of a corporation as an entirety or
substantially as an entirety to the Corporation or a Manufacturing
Subsidiary;
(v) Mortgages on property of the Corporation or a
Manufacturing Subsidiary in favor of the United States of America or
any State thereof, or any department, agency or instrumentality or
political subdivision of the United States of America or any State
thereof, or in favor of any other country, or any political subdivision
thereof, to secure partial, progress, advance or other payments
pursuant to any contract or statute or to secure any indebtedness
incurred for the purpose of financing all or any part of the purchase
price or the cost of construction of the property subject to such
Mortgages; or
(vi) any extension, renewal or replacement (or successive
extensions, renewals or replacements) in whole or in part of any
Mortgage referred to in the foregoing clauses (i) to (v); provided,
however, that the principal amount of Debt secured thereby shall not
exceed by more than 115% the principal amount of Debt so secured at the
time of such extension, renewal or replacement and that such extension,
renewal or replacement shall be limited to all or a part of the
property which secured the Mortgage so extended, renewed or replaced
(plus improvements on such property). (Section 4.06 of the Indenture.)
LIMITATION ON SALE AND LEASE-BACK. For the benefit of the Debt Securities, the
Corporation will not, nor will it permit any Manufacturing Subsidiary to, enter
into any arrangement with any person providing for the leasing by the
Corporation or any Manufacturing Subsidiary of any Principal Domestic
Manufacturing Property owned by the Corporation or any Manufacturing Subsidiary
on the date that the Debt Securities are originally issued (except for temporary
leases for a term of not more than five years and except for leases between the
Corporation and a Manufacturing Subsidiary or between Manufacturing
Subsidiaries), which property has been or is to be sold or transferred by the
Corporation or such Manufacturing Subsidiary to such person, unless either:
(i) the Corporation or such Manufacturing Subsidiary would be
entitled, pursuant to the provisions of the covenant on limitation on
liens described above, to issue, assume, extend, renew or replace Debt
secured by a Mortgage upon such property equal in amount to the
Attributable Debt in respect of such arrangement without equally and
ratably securing the Debt Securities; provided, however, that from and
after the date on which such arrangement becomes effective the
Attributable Debt in respect of such arrangement shall be deemed for
all purposes under the covenant on limitation on liens described above
and this covenant on limitation on sale and lease-back to be Debt
subject to the provisions of the covenant on limitation on liens
described above (which provisions include the exceptions set forth in
clauses (i) through (vi) of such covenant), or
(ii) the Corporation shall apply an amount in cash equal to
the Attributable Debt in respect of such arrangement to the retirement
(other than any mandatory retirement or by way of payment at maturity),
within 180 days of the effective date of any such arrangement, of Debt
of the Corporation or any Manufacturing Subsidiary (other than Debt
owned by the Corporation or any Manufacturing Subsidiary) which by its
terms matures at or is extendible or renewable at the option of the
obligor to a date more than twelve months after the date of the
creation of such Debt. (Section 4.07 of the Indenture.)
DEFEASANCE
If the terms of a particular series of Debt Securities so provide, the
Corporation may, at its option, (a) discharge its indebtedness and its
obligations under the Indenture with respect to such series or (b) not comply
with certain covenants contained in the Indenture with respect to such series,
in each case by depositing funds or obligations issued or guaranteed by the
United States of America with the Trustee. The Prospectus Supplement will more
fully describe the provisions, if any, relating to such defeasance. (Section
12.02 of the Indenture.)
9
MODIFICATION OF THE INDENTURE
The Indenture provides that the Corporation and the Trustee may enter into
supplemental indentures without the consent of the holders of the Debt
Securities to (a) evidence the assumption by a successor corporation of the
obligations of the Corporation, (b) add covenants for the protection of the
holders of the Debt Securities, (c) add or change any of the provisions of the
Indenture to permit or facilitate the issuance of Debt Securities of any series
in bearer form, (d) cure any ambiguity or correct any inconsistency in such
Indenture, (e) establish the form or terms of Debt Securities of any series as
permitted by the terms of the Indenture and (f) evidence the acceptance of
appointment by a successor trustee. (Section 10.01 of the Indenture.)
The Indenture also contains provisions permitting the Corporation and the
Trustee to modify or amend the Indenture or any supplemental indenture or the
rights of the holders of the Debt Securities issued thereunder, with the consent
of the holders of not less than a majority in principal amount of the Debt
Securities of all series at the time outstanding under such Indenture which are
affected by such modification or amendment (voting as one class), provided that
no such modification shall (i) extend the fixed maturity of any Debt Securities,
or reduce the principal amount thereof, or premium, if any, or reduce the rate
or extend the time of payment of interest or Additional Amounts thereon, or
reduce the amount due and payable upon acceleration of the maturity thereof or
the amount provable in bankruptcy, or make the principal of, or interest,
premium or Additional Amounts on, any Debt Security payable in any coin or
currency other than that provided in such Debt Security, (ii) impair the right
to initiate suit for the enforcement of any such payment on or after the stated
maturity thereof, or (iii) reduce the aforesaid percentage of Debt Securities,
the consent of the holders of which is required for any such modification, or
the percentage required for the consent of the holders to waive defaults,
without the consent of the holder of each Debt Security so affected. (Section
10.02 of the Indenture.)
EVENTS OF DEFAULT
An Event of Default with respect to any series of Debt Securities is
defined in the Indenture as being: (a) default in payment of any principal or
premium, if any, on such series; (b) default for 30 days in payment of any
interest or Additional Amounts on such series; (c) default for 90 days after
notice in performance of any other covenant applicable to the Debt Securities;
or (d) certain events of bankruptcy, insolvency or reorganization. (Section 6.01
of the Indenture.)
No Event of Default with respect to a particular series of Debt Securities
issued under the Indenture necessarily constitutes an Event of Default with
respect to any other series of Debt Securities issued thereunder. In case an
Event of Default under clause (a), (b) or (c) shall occur and be continuing with
respect to any series, the Trustee or the holders of not less than 25% in
aggregate principal amount of Debt Securities of each such series then
outstanding may declare the principal (or, in the case of discounted Debt
Securities, the amount specified in the terms thereof) of such series to be due
and payable. In case an Event of Default under clause (d) shall occur and be
continuing, the Trustee or the holders of not less than 25% in aggregate
principal amount of all the Debt Securities then outstanding (voting as one
class) may declare the principal (or, in the case of discounted Debt Securities,
the amount specified in the terms thereof) of all outstanding Debt Securities to
be due and payable. Any Event of Default with respect to a particular series of
Debt Securities may be waived by the holders of a majority in aggregate
principal amount of the outstanding Debt Securities of such series (or of all
the outstanding Debt Securities, as the case may be), except in a case of
failure to pay principal or premium, if any, or interest or Additional Amounts
in respect of such Debt Security for which payment had not been subsequently
made. (Section 6.01 of the Indenture.) The Indenture provides that the Trustee
may withhold notice to the securityholders of any default (except in payment of
principal, premium, if any, or interest or Additional Amounts) if it considers
it in the interests of the securityholders to do so. (Section 6.07 of the
Indenture.)
10
Subject to the provisions of the Indenture relating to the duties of the
Trustee in case an Event of Default shall occur and be continuing, the Trustee
shall be under no obligation to exercise any of its rights or powers under the
Indenture at the request, order or direction of any of the securityholders,
unless such securityholders shall have offered to the Trustee reasonable
indemnity. (Sections 7.01 and 7.02 of the Indenture.) Subject to such provisions
for the indemnification of the Trustee and to certain other limitations, the
holders of a majority in aggregate principal amount of the Debt Securities of
all series affected (voting as one class) at the time outstanding shall have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred on
the Trustee.(Section 6.06 of the Indenture.)
CONCERNING THE TRUSTEE
Citibank, N.A. is the Trustee under the Indenture. Citibank, N.A. acts as
depositary for funds of, makes loans to, acts as trustee and performs certain
other services for, the Corporation and certain of its subsidiaries and
affiliates in the normal course of its business.
DESCRIPTION OF WARRANTS
GENERAL
The Corporation may issue, together with Debt Securities or separately,
Warrants for the purchase of Debt Securities. If the Warrants are issued
together with any Debt Securities, they may be attached to or traded separately
from such Debt Securities. The Warrants are to be issued under one or more
separate Warrant Agreements (each a "Warrant Agreement") between the Corporation
and a banking institution organized under the laws of the United States or one
of the States thereof (each a "Warrant Agent").
The following statements with respect to the Warrants are summaries of the
Warrant Agreement, a form of which is filed as an exhibit to the Registration
Statement. Such summaries of certain provisions of the Warrant Agreement and the
Warrants do not purport to be complete and such summaries are subject to the
detailed provisions of the Warrant Agreement to which reference is hereby made
for a full description of such provisions, including the definition of certain
terms used herein, and for other information regarding the Warrants. Wherever
particular provisions of the Warrant Agreement or terms defined therein are
referred to, such provisions or definitions are incorporated by reference as a
part of the statements made, and the statements are qualified in their entirety
by such reference.
The Warrants will be evidenced by Warrant Certificates (the "Warrant
Certificates") and, except as otherwise specified in the Prospectus Supplement
accompanying this Prospectus, may be traded separately from any Debt Securities
with which they may be issued. Warrant Certificates may be exchanged for new
Warrant Certificates of different denominations at the office of the Warrant
Agent. The holder of a Warrant does not have any of the rights of a holder of a
Debt Security in respect of, and is not entitled to any payments on, any Debt
Securities issuable (but not yet issued) upon exercise of the Warrants.
The Warrants may be issued in one or more series, and reference is made to
the Prospectus Supplement accompanying this Prospectus relating to the
particular series of Warrants offered thereby for the terms of, and other
information with respect to, such Warrants, including: (i) the title and the
aggregate number of Warrants; (ii) the designation, aggregate principal amount,
currency or currencies and terms of the Debt Securities that may be purchased
upon exercise of the Warrants; (iii) the price or prices at which such Warrants
are exercisable; (iv) the currency or currencies in which such Warrants are
exercisable; (v) the places at which such Warrants are exercisable and the date
on which the right to exercise the Warrants shall commence and the date on which
such right shall expire (the "Warrant Expiration Date") or, if the Warrants are
not continuously exercisable throughout such period, the specific date or dates
on which they will be exercisable (each, a "Warrant Exercise Date", which term
shall also mean, with respect to Warrants continuously exercisable for a period
of time, every date during such period); (vi) the terms of any mandatory or
optional call provisions; (vii) the price or prices, if any, at which the
Warrants may be redeemed at the option of the holder or will be redeemed upon
expiration; (viii) the identity of the Warrant Agent; (ix) the exchanges, if
any, on which such Warrants may be listed; (x) whether such Warrants shall be
issued in book-entry form; (xi) if applicable, the designation and terms of the
11
Debt Securities with which the Warrants are issued and the number of Warrants
issued with each of such Debt Securities; (xii) if applicable, the date on and
after which the Warrants and the related Debt Securities will be separately
transferable; (xiii) whether the Warrant Certificates will be in registered form
or bearer form or both; (xiv) any applicable United States Federal income tax
consequences; (xv) the price at which the Warrants will be issued; and (xvi) any
other terms of the Warrants.
EXERCISE OF WARRANTS
Warrants in registered form may be exercised by payment to the Warrant
Agent of the exercise price, in each case in such currency or currencies as are
specified in the Warrant, and by communicating to the Warrant Agent the identity
of the Warrantholder and the number of Warrants to be exercised. Upon receipt of
payment and the Warrant Certificate properly completed and duly executed, at the
office of the Warrant Agent, the Warrant Agent will, as soon as practicable,
arrange for the issuance of the applicable Debt Securities, the form of which
shall be set forth in the Prospectus Supplement. If less than all of the
Warrants evidenced by a Warrant Certificate are exercised, a new Warrant
Certificate will be issued for the remaining amounts of Warrants. A more
complete summary for the exercise of Warrants in registered form and for
exercises of Warrants in bearer form is contained in the Prospectus Supplement
accompanying this Prospectus.
PLAN OF DISTRIBUTION
The Corporation may sell the Securities being offered hereby in any of four
ways: (i) directly to purchasers, (ii) through agents, (iii) through
underwriters, and (iv) through dealers.
Offers to purchase Securities may be solicited directly by the Corporation
or by agents designated by the Corporation from time to time. Any such agent,
who may be deemed to be an underwriter as that term is defined in the Securities
Act of 1933, involved in the offer or sale of the Securities in respect of which
this Prospectus is delivered will be named, and any commissions payable by the
Corporation to such agent set forth, in the Prospectus Supplement. Unless
otherwise indicated in the Prospectus Supplement, any such agent will be acting
on a reasonable best efforts basis for the period of its appointment (ordinarily
five business days or less). Agents may be entitled under agreements which may
be entered into with the Corporation to indemnification by the Corporation
against certain civil liabilities, including liabilities under the Securities
Act of 1933, and may be customers of, engage in transactions with, or perform
services for, the Corporation and its subsidiaries in the ordinary course of
business.
If an underwriter or underwriters are utilized in the sale, the Corporation
will enter into an underwriting agreement with such underwriters at the time of
sale to them and the names of the underwriters and the terms of the transaction
will be set forth in the Prospectus Supplement, which will be used by the
underwriters to make resales of the Securities in respect of which this
Prospectus is delivered to the public. The underwriters may be entitled, under
the relevant underwriting agreement, to indemnification by the Corporation
against certain liabilities, including liabilities under the Securities Act of
1933. Among others, one or more of the following firms may act as managing
underwriter(s) with respect to the offering of the Securities: Bear, Stearns &
Co. Inc., Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith, J.P.
Morgan Securities Inc., Morgan Stanley Dean Witter, Morgan Stanley & Co.
Incorporated, Salomon Smith Barney and Salomon Brothers Inc.
12
If a dealer is utilized in the sale of the Securities in respect of which
this Prospectus is delivered, the Corporation will sell such Securities to the
dealer as principal. The dealer may then resell such Securities to the public at
varying prices to be determined by such dealer at the time of resale. Dealers
may be entitled to indemnification by the Corporation against certain
liabilities, including liabilities under the Securities Act of 1933.
If so indicated in the applicable Prospectus Supplement, the Corporation
will authorize agents and underwriters to solicit offers by certain institutions
to purchase Securities from the Corporation at the public offering price set
forth in the Prospectus Supplement pursuant to Delayed Delivery Contracts
("Contracts") providing for payment and delivery on the date stated in the
Prospectus Supplement. Each Contract will be for an amount not less than, and
unless the Corporation otherwise agrees the aggregate principal amount of
Securities sold pursuant to Contracts shall be not less nor more than, the
respective amounts stated in the Prospectus Supplement. Institutions with whom
Contracts, when authorized, may be made include commercial and savings banks,
insurance companies, pension funds, investment companies, educational and
charitable institutions, and other institutions but shall in all cases be
subject to the approval of the Corporation. Contracts will not be subject to any
conditions except that the purchase by an institution of the Securities covered
by its Contract shall not at the time of delivery be prohibited under the laws
of any jurisdiction in the United States to which such institution is subject. A
commission indicated in the applicable Prospectus Supplement will be paid to
underwriters and agents soliciting purchases of Securities pursuant to Contracts
accepted by the Corporation.
The place and time of delivery for the Securities in respect of which this
Prospectus is delivered are set forth in the accompanying Prospectus Supplement.
--------------------
Dennis Weatherstone, a director of J. P. Morgan & Co. Incorporated, of
which J. P. Morgan Securities Inc. is an indirect wholly-owned subsidiary, is a
director of the Corporation. In the ordinary course of their respective
businesses, affiliates of the Agents have engaged, and will in the future engage
in commercial banking and investment banking transactions with General Motors
and certain of its affiliates.
EXPERTS
The consolidated financial statements and the financial statement schedule
included in the Corporation's 1997 Annual Report on Form 10-K, as amended,
incorporated by reference herein, have been audited by Deloitte & Touche LLP,
independent public accountants, as stated in their reports appearing therein,
and have been so incorporated by reference in reliance upon such reports given
upon the authority of such firm as experts in accounting and auditing.
LEGAL OPINIONS
Unless otherwise indicated in the Prospectus Supplement relating to the
Securities, the legality of the Securities will be passed upon for the
Corporation by Martin I. Darvick, Attorney, Legal Staff, of the Corporation. Mr.
Darvick owns shares, and has options to purchase shares, of the Corporation's
Common Stock, $1-2/3 Par Value and owns shares of the Corporation's Class H
Common Stock, $0.10 par value.
Unless otherwise indicated in the Prospectus Supplement relating to the
Securities, certain legal matters relating to the Securities will be passed upon
for the Underwriters by Davis Polk & Wardwell. Davis Polk & Wardwell acts as
counsel to the Executive Compensation Committee of the Board of Directors of the
Corporation and has acted as counsel for the Corporation and its subsidiaries in
various matters.
13