<PAGE> 1
Filed Pursuant to Rule 424B2
Registration Statement No. 333-75463
PROSPECTUS SUPPLEMENT
(To Prospectus dated April 15, 1999)
GENERAL MOTORS ACCEPTANCE CORPORATION
$1,500,000,000
6.85% Notes due June 17, 2004
Interest payable June 17 and December 17
ISSUE PRICE: 99.971%
The notes will mature on June 17, 2004. Interest will accrue from June 17, 1999,
at the rate of 6.85% per annum. Interest is payable semiannually on June 17 and
December 17 of each year, commencing December 17, 1999. The notes will not be
redeemable prior to maturity unless certain events occur involving United States
taxation.
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 prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC COMMISSIONS THE COMPANY
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Note 99.971% .325% 99.646%
- ----------------------------------------------------------------------------------------------------------
Total $1,499,565,000 $4,875,000 $1,494,690,000
- ----------------------------------------------------------------------------------------------------------
</TABLE>
Application has been made to list the notes on the Luxembourg Stock Exchange.
It is expected that delivery of the notes will be made to investors on or about
June 17, 1999 only through The Depository Trust Company, the Euroclear System or
Cedelbank.
JOINT BOOKRUNNERS
J.P. MORGAN & CO. MORGAN STANLEY DEAN WITTER
CO-LEAD MANAGERS
BEAR, STEARNS & CO. INC. LEHMAN BROTHERS
MERRILL LYNCH & CO. SALOMON SMITH BARNEY
WARBURG DILLON READ LLC
CO-MANAGERS
ABN AMRO INCORPORATED BANC OF AMERICA SECURITIES LLC
BANC ONE CAPITAL MARKETS, INC. BARCLAYS CAPITAL
CHASE SECURITIES INC. CREDIT SUISSE FIRST BOSTON
DEUTSCHE BANK HSBC MARKETS
WESTDEUTSCHE LANDESBANK GIROZENTRALE
The activities of the underwriters of the notes are being jointly led by J.P.
Morgan & Co. and Morgan Stanley Dean Witter.
June 10, 1999
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PROSPECTUS SUPPLEMENT
Incorporation of Certain Documents by Reference............. S-3
Description of General Motors Acceptance Corporation........ S-4
Directors of the Company.................................... S-4
Ratio of Earnings to Fixed Charges.......................... S-5
Consolidated Capitalization of the Company.................. S-5
Selected Consolidated Financial Data........................ S-6
Use of Proceeds............................................. S-7
Description of Notes........................................ S-7
United States Federal Taxation.............................. S-13
Underwriting................................................ S-17
General Information......................................... S-18
Legal Opinions.............................................. S-19
PROSPECTUS
Available Information....................................... 2
Principal Executive Offices................................. 2
Incorporation of Certain Documents by Reference............. 3
Ratio of Earnings to Fixed Charges.......................... 4
Use of Proceeds............................................. 4
Description of Debt Securities.............................. 5
Description of Warrants..................................... 10
Plan of Distribution........................................ 11
Experts..................................................... 12
</TABLE>
We have not, and the underwriters have not, authorized any other person to
provide you any information or to make any representations not contained in this
prospectus supplement or the accompanying prospectus. If anyone provides you
with different or inconsistent information you should not rely on it. We are
not, and the underwriters are not, making an offer of any securities other than
the notes. This prospectus supplement is part of and must be read in conjunction
with the accompanying prospectus dated April 15, 1999. You should 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 the date on the front cover of this prospectus supplement only.
The distribution of this prospectus supplement and the prospectus and the
offering of the notes in certain jurisdictions may be restricted by law. You
should inform yourself about and observe any such restrictions. This prospectus
supplement and the prospectus do not constitute, and may not be used in
connection with, an offer or solicitation 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.
This prospectus supplement and the accompanying prospectus include
particulars given in compliance with the rules governing the listing of
securities on the Luxembourg Stock Exchange. We accept full responsibility for
the accuracy of the information contained in this prospectus supplement and the
accompanying prospectus and confirms, having made all reasonable inquiries, that
to the best of our knowledge and belief there are no other facts the omission of
which would make any statement contained herein misleading.
Unless otherwise specified or the context otherwise requires, references in
this prospectus supplement and accompanying prospectus to "dollars", "$" and
"U.S.$" are to United States dollars.
S-2
<PAGE> 3
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. 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 GMAC
previously filed with the SEC. These documents contain important information
about General Motors Acceptance Corporation and its finances.
<TABLE>
<CAPTION>
SEC FILINGS PERIOD
- ----------- ------
<S> <C>
Annual Report on Form 10-K................... Year ended December 31, 1998
Quarterly Report on Form 10-Q................ Quarter ended March 31, 1999
Current Reports on Form 8-K.................. Dated January 21, 1999, April 15, 1999, April
22, 1999 and June 8, 1999
</TABLE>
You may, at no cost, request a copy of the documents incorporated by
reference in this prospectus, except exhibits to such prospectus, by writing or
telephoning the office of G.E. Gross, Comptroller, at the following address and
telephone number:
General Motors Acceptance Corporation
3044 West Grand Boulevard
Mail code 482-1x1-103
Detroit, Michigan 48202
Tel: (313) 556-1240
This prospectus supplement and accompanying prospectus, together with the
documents incorporated in them by reference, will be available free of charge at
the office of Banque Generale du Luxembourg S.A., 50 Avenue J. F. Kennedy,
L-2951, Luxembourg.
S-3
<PAGE> 4
DESCRIPTION OF GENERAL MOTORS ACCEPTANCE CORPORATION
General Motors Acceptance Corporation (the "Company"), a wholly-owned
subsidiary of General Motors Corporation, was incorporated in 1997 under the
Delaware General Corporation Law. On January 1, 1998, the Company merged with
its predecessor which was originally incorporated in 1919 under the New York
Banking Law relating to investment companies, and thereupon assumed all of its
predecessor's assets, liabilities and obligations.
Operating directly and through subsidiaries and associated companies in
which it has equity investments, the Company offers a wide variety of automotive
financial services to and through franchised General Motors dealers in many
countries throughout the world. Financial services also are offered to other
automobile dealerships and to the customers of those dealerships. Other
financial services offered by the Company or its subsidiaries include insurance
and mortgage banking.
The principal business of the Company and its subsidiaries is to finance
the acquisition by franchised General Motors dealers for resale of various new
automotive and nonautomotive products manufactured by General Motors Corporation
or certain of its subsidiaries and associates, and to acquire from such dealers,
either directly or indirectly, installment obligations covering retail sales and
leases of new General Motors products as well as used units of any make. In
addition, new products of other manufacturers are financed. The Company also
leases motor vehicles and certain types of capital equipment to others.
The automotive financing industry is highly competitive. The Company's
principal competitors are affiliated finance subsidiaries of other major
manufacturers as well as a large number of banks, commercial finance companies,
savings and loan associations and credit unions. The business of the Company is
influenced by its ability to offer competitive financing rates which in turn is
directly affected by its access to capital markets.
The Company has its principal executive offices at 3044 West Grand
Boulevard, Detroit, Michigan 48202, United States.
DIRECTORS OF THE COMPANY
<TABLE>
<CAPTION>
NAME POSITION
---- --------
<S> <C>
Richard J.S. Clout................ Executive Vice President
Eric A. Feldstein................. Vice President and Treasurer, General Motors Corporation
John D. Finnegan.................. Chairman and President, General Motors Acceptance
Corporation and Executive Vice President and Group
Executive, General Motors Corporation
John E. Gibson.................... Executive Vice President
J. Michael Losh................... Executive Vice President and Chief Financial Officer,
General Motors Corporation
William F. Muir................... Executive Vice President and Chief Financial Officer
Harry J. Pearce................... Vice Chairman, General Motors Corporation
W. Allen Reed..................... Vice President and Chief Investment Funds Officer, General
Motors Corporation
John F. Smith, Jr. ............... Chairman and Chief Executive Officer, General Motors
Corporation
G. Richard Wagoner, Jr. .......... President and Chief Operating Officer, General Motors
Corporation
Ronald L. Zarrella................ Executive Vice President and President of GM North America,
General Motors Corporation
</TABLE>
The above Directors do not hold any significant position outside General
Motors Corporation, the Company and their respective subsidiaries.
S-4
<PAGE> 5
The business address of each Director is 3044 West Grand Boulevard,
Detroit, Michigan 48202, United States.
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEARS ENDED
MARCH 31, DECEMBER 31,
------------------- -------------
1999 1998 1998 1997
---- ---- ---- ----
<S> <C> <C> <C>
1.42 1.37 1.33 1.42
</TABLE>
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.
CONSOLIDATED CAPITALIZATION OF THE COMPANY
(UNAUDITED)
(IN MILLIONS OF U.S. DOLLARS)
<TABLE>
<CAPTION>
MARCH 31,
1999
---------
<S> <C>
NOTES, LOANS AND DEBENTURES
Payable within one year................................... $ 56,986.4
Payable after one year.................................... 48,339.4
----------
Total notes, loans and debentures.................... $105,325.8
==========
STOCKHOLDER'S EQUITY
Common stock, $.10 par value (authorized 10,000 shares,
outstanding 10 shares) and paid-in capital............. $ 2,200.0
Net income retained for use in the business............... 7,668.9
Net unrealized gains on securities........................ 328.6
Unrealized accumulated foreign currency translation
adjustment............................................. (183.6)
----------
Total stockholder's equity............................. $ 10,013.9
==========
</TABLE>
There has been no material change in the consolidated capitalization of the
Company since March 31, 1999.
S-5
<PAGE> 6
SELECTED CONSOLIDATED FINANCIAL DATA
The following table sets forth selected financial data derived from the
audited consolidated financial statements of the Company for the two years ended
December 31, 1998 and 1997 and from unaudited financial statements for the three
months ended March 31, 1999 and 1998. The Company believes that all adjustments
necessary for the fair presentation thereof have been made to the unaudited
financial data. The results for the interim period ended March 31, 1999 are not
necessarily indicative of the results for the full year. The following
information should be read in conjunction with the consolidated financial
statements and related notes incorporated by reference in the accompanying
prospectus. See "Incorporation of Certain Documents by Reference" in the
accompanying prospectus.
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEARS ENDED
MARCH 31, DECEMBER 31,
------------------------ ------------------------
1999 1998 1998 1997
---- ---- ---- ----
(IN MILLIONS OF U.S. DOLLARS)
<S> <C> <C> <C> <C>
BALANCE SHEET DATA(1):
Cash and Cash Equivalents..................... $ 850.2 $ 845.8 $ 618.1 $ 759.2
---------- ---------- ---------- ----------
Earning Assets
Investments in securities..................... 8,520.3 7,701.9 8,681.9 7,896.1
Finance receivables, net...................... 74,518.4 63,170.4 71,101.2 59,048.9
Investment in operating leases, net........... 27,716.4 26,307.9 27,925.8 25,981.4
Notes receivable from General Motors
Corporation................................. 2,589.9 2,077.1 2,270.5 551.7
Real estate mortgages--held for sale.......... 4,996.0 4,903.2 7,969.7 5,119.5
--held for
investment.................................. 1,399.9 675.6 1,296.7 713.0
--lending
receivables................................. 1,423.1 2,196.1 2,063.6 2,222.9
Due and deferred from receivable sales, net... (12.2) 258.6 111.5 690.5
Other......................................... 3,546.6 1,803.3 3,683.7 1,807.6
---------- ---------- ---------- ----------
Total earning assets........................ 124,698.4 109,094.1 125,104.6 104,481.2
---------- ---------- ---------- ----------
Nonearning assets............................. 6,099.3 4,760.2 5,694.8 4,528.5
---------- ---------- ---------- ----------
Total Assets.................................. $131,647.9 $114,700.1 $131,417.5 $109,319.3
========== ========== ========== ==========
Notes, loans and debentures payable within one
year........................................ $ 56,986.4 $ 52,092.7 $ 60,816.7 $ 50,399.5
---------- ---------- ---------- ----------
Accounts Payable and Other Liabilities
General Motors Corporation and affiliated
companies................................... 1,243.7 2,017.9 929.6 698.9
Interest...................................... 1,497.2 1,358.4 1,264.2 1,101.8
Insurance losses and loss expenses............ 2,037.1 2,085.2 2,062.7 2,125.3
Unearned insurance premiums................... 1,903.1 1,836.3 1,855.6 1,804.1
Deferred income taxes......................... 3,019.4 2,597.7 2,842.9 2,557.1
United States and foreign income and other
taxes payable............................... 480.8 377.8 570.7 321.2
Other postretirement benefits................. 693.1 669.3 685.3 652.6
Other......................................... 5,433.8 4,620.7 5,241.7 4,607.5
---------- ---------- ---------- ----------
Total accounts payable and other
liabilities.............................. 16,308.2 15,563.3 15,452.7 13,888.5
---------- ---------- ---------- ----------
Notes, loans and debentures payable after one
year........................................ 48,339.4 37,981.2 45,356.5 36,275.2
---------- ---------- ---------- ----------
Common stock, $.10 par value (authorized
10,000 shares, outstanding 10 shares) and
paid-in capital............................. 2,200.0 2,200.0 2,200.0 2,200.0
Net income retained for use in the business... 7,668.9 6,600.6 7,351.6 6,326.3
Net unrealized gains on securities............ 328.6 421.9 381.5 368.5
Unrealized accumulated foreign currency
translation adjustment...................... (183.6) (159.6) (141.5) (138.7)
---------- ---------- ---------- ----------
Accumulated other comprehensive income...... 145.0 262.3 240.0 229.8
---------- ---------- ---------- ----------
Total stockholder's equity.................. 10,013.9 9,062.9 9,791.6 8,756.1
---------- ---------- ---------- ----------
Total Liabilities and Stockholder's Equity.... $131,647.9 $114,700.1 $131,417.5 $109,319.3
========== ========== ========== ==========
</TABLE>
- -------------------------
(1) Certain amounts for 1997 have been reclassified to conform with 1998
classifications.
S-6
<PAGE> 7
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEARS ENDED
MARCH 31, DECEMBER 31,
-------------------- --------------------
1999 1998 1998 1997
---- ---- ---- ----
(IN MILLIONS OF U.S. DOLLARS)
<S> <C> <C> <C> <C>
INCOME STATEMENT DATA(1):
Financing Revenue
Retail and lease financing............................ $1,005.9 $ 902.0 $3,868.8 $3,570.5
Operating leases...................................... 1,795.5 1,784.7 7,233.0 7,260.5
Wholesale and term loans.............................. 475.7 420.1 1,628.9 1,745.6
-------- -------- -------- --------
Total automotive financing revenue.................. 3,277.1 3,106.8 12,730.7 12,576.6
Interest and discount................................. 1,512.9 1,384.5 5,786.9 5,255.5
Depreciation on operating leases...................... 1,188.5 1,178.3 4,692.4 4,677.5
-------- -------- -------- --------
Net automotive financing revenue.................... 575.7 544.0 2,251.4 2,643.6
Insurance premiums earned............................. 446.6 471.0 1,858.4 1,360.4
Mortgage revenue...................................... 728.2 417.4 2,029.9 1,498.7
Other income.......................................... 374.1 330.8 1,294.9 1,159.7
-------- -------- -------- --------
Net Financing Revenue and Other..................... 2,124.6 1,763.2 7,434.6 6,662.4
-------- -------- -------- --------
Expenses
Salaries and benefits................................. 395.7 289.9 1,167.0 1,050.4
Other operating expenses.............................. 621.2 498.3 2,350.3 1,801.8
Insurance losses and loss adjustment expenses......... 347.2 353.0 1,517.2 1,073.5
Provision for credit losses........................... 119.3 107.2 463.1 522.7
-------- -------- -------- --------
Total expenses...................................... 1,483.4 1,248.4 5,497.6 4,448.4
-------- -------- -------- --------
Income before income taxes............................ 641.2 514.8 1,937.0 2,214.0
United States, foreign and other income taxes......... 248.9 165.5 611.7 912.9
-------- -------- -------- --------
Net Income.......................................... 392.3 349.3 1,325.3 1,301.1
Net income retained for use in the business at
beginning of the period............................. 7,351.6 6,362.3 6,326.3 5,775.2
-------- -------- -------- --------
Total................................................. 7,743.9 6,675.6 7,651.6 7,076.3
Cash dividends........................................ 75.0 75.0 300.0 750.0
-------- -------- -------- --------
Net Income Retained for Use in the Business at End
of the Period.................................... $7,668.9 $6,600.6 $7,351.6 $6,326.3
======== ======== ======== ========
</TABLE>
- -------------------------
(1) Certain amounts for 1997 have been reclassified to conform with 1998
classifications.
USE OF PROCEEDS
The net proceeds to the Company before expenses will be $1,494,690,000. The
company expects that its estimated expenses will be $250,000.
DESCRIPTION OF NOTES
GENERAL
The following description of the particular terms of the 6.85% Notes Due
June 17, 2004 (the "Notes") offered hereby supplements, and to the extent
inconsistent therewith replaces, the description of the general terms and
provisions of the Debt Securities set forth in the prospectus. The Notes are
part of the Debt Securities registered by the Company in April 1999 to be issued
on terms to be determined at the time of sale.
S-7
<PAGE> 8
The Notes offered hereby will be issued in an aggregate principal amount of
$1,500,000,000 pursuant to an Indenture dated as of July 1, 1982, as amended,
which is more fully described in the accompanying prospectus and the Notes have
been authorized and approved by resolution of the Board of Directors of the
Company dated March 30, 1999.
The Indenture and the Notes provide that they are governed by, and
construed in accordance with, the laws of the State of New York, United States.
The Notes will be redeemed at par on June 17, 2004. The Notes are not
redeemable by the Company prior to maturity unless certain events occur
involving U.S. taxation. See "--Redemption for Tax Reasons." The Notes will bear
interest, calculated on the basis of a 360-day year consisting of twelve 30-day
months, from June 17, 1999 at the rate of 6.85% per annum, payable on June 17
and December 17 of each year, commencing December 17, 1999, to the person in
whose name the Notes are registered at the close of business on the last day of
the calendar month next preceding such June and December.
BOOK-ENTRY, DELIVERY AND FORM
The Notes will be offered and sold in principal amounts of U.S. $1,000 and
integral multiples thereof. Each of the Notes will be issued in the form of one
or more fully registered Global Notes (collectively, the "Global Notes") which
will be deposited with, or on behalf of, The Depository Trust Company, New York,
New York (the "Depository" or "DTC") and registered in the name of Cede & Co.,
the Depository's nominee. Beneficial interests in the Global Notes will be
represented through book-entry accounts of financial institutions acting on
behalf of beneficial owners as direct and indirect participants in the
Depository. Investors may elect to hold interests in the Global Notes through
either the Depository or Cedelbank or Morgan Guaranty Trust Company of New York,
Brussels Office, as operator of the Euroclear System ("Euroclear") if they are
participants of such systems, or indirectly through organizations which are
participants in such systems. Cedelbank and Euroclear will hold interests on
behalf of their participants through customers' securities accounts in
Cedelbank's and Euroclear's names on the books of their respective depositaries,
which in turn will hold such interests in customers' securities accounts in the
depositaries' names on the books of the Depository. Citibank, N.A. will act as
depositary for Cedelbank and The Chase Manhattan Bank will act as depositary for
Euroclear (in such capacities, the "U.S. Depositaries"). Except as set forth
below, the Global Notes may be transferred, in whole and not in part, only to
another nominee of the Depository or to a successor of the Depository or its
nominee.
The Depository's management is aware that some computer applications,
systems, and the like for processing data ("Systems") that are dependent upon
calendar dates, including dates before, on, and after January 1, 2000, may
encounter "Year 2000 problems." The Depository has informed Participants and
other members of the financial community that it has developed and is
implementing a program so that its Systems, as the same relate to the timely
payment of distributions (including principal and income payments) to
securityholders, book-entry deliveries, and settlement of trades within DTC
("DTC Services"), continue to function appropriately. This program includes a
technical assessment and a remediation plan, each of which is complete.
Additionally, the Depository's plan includes a testing phase, which is expected
to be completed within appropriate time frames. However, the Depository's
ability to properly perform its services is also dependent upon other parties,
including but not limited to issuers and their agents, as well as third party
vendors from whom the Depository licenses software and hardware, and third party
vendors on whom the Depository's relies for information or the provision of
services, including telecommunication and electrical utility service providers,
among others.
Cedelbank advises that it is incorporated under the laws of Luxembourg as a
professional depositary. Cedelbank holds securities for its participating
organizations ("Cedelbank Participants") and facilitates the clearance and
settlement of securities transactions between Cedelbank Participants through
electronic book-entry changes in accounts of Cedelbank Participants, thereby
eliminating the need for physical movement of certificates. Cedelbank provides
to Cedelbank Participants, among other things, services for safekeeping,
administration, clearance and settlement of internationally traded securities
and securities lending and borrowing. Cedelbank interfaces with domestic markets
in several countries. As a professional
S-8
<PAGE> 9
depositary, Cedelbank is subject to regulation by the Luxembourg Monetary
Institute. Cedelbank Participants are recognized financial institutions around
the world, including underwriters, securities brokers and dealers, banks, trust
companies, clearing corporations and certain other organizations and may include
the underwriters. Indirect access to Cedelbank is also available to others, such
as banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a Cedelbank Participant, either directly or
indirectly.
Distributions with respect to the Notes held beneficially through Cedelbank
will be credited to cash accounts of Cedelbank Participants in accordance with
its rules and procedures, to the extent received by the U.S. Depositary for
Cedelbank.
Euroclear advises that it was created in 1968 to hold securities for its
participants ("Euroclear Participants") and to clear and settle transactions
between Euroclear Participants through simultaneous electronic book-entry
delivery against payment, thereby eliminating the need for physical movement of
certificates and any risk from lack of simultaneous transfers of securities and
cash. Euroclear provides various other services, including securities lending
and borrowing and interfaces with domestic markets in several countries.
Euroclear is operated by the Brussels, Belgium office of Morgan Guaranty Trust
Company of New York (the "Euroclear Operator"), under contract with Euroclear
Clearance Systems S.C., a Belgian cooperative corporation (the "Cooperative").
All operations are conducted by the Euroclear Operator, and all Euroclear
securities clearance accounts and Euroclear cash accounts are accounts with the
Euroclear Operator, not the Cooperative. The Cooperative establishes policy for
Euroclear on behalf of Euroclear Participants. Euroclear Participants include
banks (including central banks), securities brokers and dealers and other
professional financial intermediaries and may include the underwriters. Indirect
access to Euroclear is also available to other firms that clear through or
maintain a custodial relationship with a Euroclear Participant, either directly
or indirectly.
The Euroclear Operator is the Belgian branch of a New York banking
corporation which is a member bank of the Federal Reserve System. As such, it is
regulated and examined by the Board of Governors of the Federal Reserve System
and the New York State Banking Department, as well as the Belgian Banking
Commission.
Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of the Euroclear System, and applicable Belgian law
(collectively, the "Terms and Conditions"). The Terms and Conditions govern
transfers of securities and cash within Euroclear, withdrawals of securities and
cash from Euroclear, and receipts of payments with respect to securities in
Euroclear. All securities in Euroclear are held on a fungible basis without
attribution of specific certificates to specific securities clearance accounts.
The Euroclear Operator acts under the Terms and Conditions only on behalf of
Euroclear Participants, and has no record of or relationship with persons
holding through Euroclear Participants.
Distributions with respect to Notes held beneficially through Euroclear
will be credited to the cash accounts of Euroclear Participants in accordance
with the Terms and Conditions, to the extent received by the U.S. Depositary for
Euroclear.
In the event definitive Notes are issued, the Company will appoint a paying
agent and transfer agent in Luxembourg (the "Luxembourg Paying and Transfer
Agent"). In the event definitive Notes are issued, the holders thereof will be
able to receive payments thereon and effect transfers thereof at the offices of
the Luxembourg Paying and Transfer Agent.
Individual certificates in respect of Notes will not be issued in exchange
for the Global Notes, except in very limited circumstances. If Euroclear,
Cedelbank or DTC notifies the Company that it is unwilling or unable to continue
as a clearing system in connection with a Global Note or, in the case of DTC
only, DTC ceases to be a clearing agency registered under the Exchange Act, and
in each case a successor clearing system is not appointed by the Company within
90 days after receiving such notice from Euroclear, Cedelbank or DTC or on
becoming aware that DTC is no longer so registered, the Company
S-9
<PAGE> 10
will issue or cause to be issued individual certificates in registered form on
registration of transfer of, or in exchange for, book-entry interests in the
Notes represented by such Global Note upon delivery of such Global Note for
cancellation.
Title to book-entry interests in the Notes will pass by book-entry
registration of the transfer within the records of Euroclear, Cedelbank or DTC,
as the case may be, in accordance with their respective procedures. Book-entry
interests in the Notes may be transferred within Euroclear and within Cedelbank
and between Euroclear and Cedelbank in accordance with procedures established
for these purposes by Euroclear and Cedelbank. Book-entry interests in the Notes
may be transferred within DTC in accordance with procedures established for this
purpose by DTC. Transfers of book-entry interests in the Notes between Euroclear
and Cedelbank and DTC may be effected in accordance with procedures established
for this purpose by Euroclear, Cedelbank and DTC.
GLOBAL CLEARANCE AND SETTLEMENT PROCEDURES
Initial settlement for the Notes will be made in immediately available
funds. Secondary market trading between DTC Participants will occur in the
ordinary way in accordance with Depository rules and will be settled in
immediately available funds using the Depository's Same-Day Funds Settlement
System. Secondary market trading between Cedelbank Participants and/or Euroclear
Participants will occur in the ordinary way in accordance with the applicable
rules and operating procedures of Cedelbank and Euroclear and will be settled
using the procedures applicable to conventional Eurobonds in immediately
available funds.
Cross-market transfers between persons holding directly or indirectly
through the Depository on the one hand, and directly or indirectly through
Cedelbank or Euroclear Participants, on the other, will be effected in the
Depository in accordance with the Depository rules on behalf of the relevant
European international clearing system by its U.S. Depositary; however, such
cross-market transactions will require delivery of instructions to the relevant
European international clearing system by the counterparty in such system in
accordance with its rules and procedures and within its established deadlines
(European time). The relevant European international clearing system will, if
the transaction meets its settlement requirements, deliver instructions to its
U.S. Depositary to take action to effect final settlement on its behalf by
delivering or receiving Notes in the Depository, and making or receiving payment
in accordance with normal procedures for same-day funds settlement applicable to
the Depository. Cedelbank Participants and Euroclear Participants may not
deliver instructions directly to their respective U.S. Depositaries.
Because of time-zone differences, credits of Notes received in Cedelbank or
Euroclear as a result of a transaction with a DTC Participant will be made
during subsequent securities settlement processing and dated the business day
following the Depository settlement date. Such credits or any transactions in
such Notes settled during such processing will be reported to the relevant
Euroclear or Cedelbank Participants on such business day. Cash received in
Cedelbank or Euroclear as a result of sales of Notes by or through a Cedelbank
Participant or a Euroclear Participant to a DTC Participant will be received
with value on the Depository settlement date but will be available in the
relevant Cedelbank or Euroclear cash account only as of the business day
following settlement in the Depository.
Although the Depository, Cedelbank and Euroclear have agreed to the
foregoing procedures in order to facilitate transfers of Notes among
participants of the Depository, Cedelbank and Euroclear, they are under no
obligation to perform or continue to perform such procedures and such procedures
may be changed or discontinued at any time.
FURTHER ISSUES
The Company may from time to time, without notice to or the consent of the
registered holders of the Notes, create and issue further Notes ranking pari
passu with the Notes in all respects (or in all respects except for the payment
of interest accruing prior to the issue date of such further Notes or except for
the first payment of interest following the issue date of such further Notes)
and so that such further
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Notes may be consolidated and form a single series with the Notes and have the
same term as to status, redemption or otherwise as the Notes.
PAYMENT OF ADDITIONAL AMOUNTS
The Company will pay to the holder of any Note who is a non-United States
person (as defined below) such additional amounts as may be necessary in order
that every net payment in respect of the principal, premium, if any, or
interest, if any, on such Note, after deduction or withholding by the
Company or any paying agent for or on account of any present or future tax,
assessment or governmental charge imposed upon or as a result of such payment by
the United States or any political subdivision or taxing authority thereof or
therein, will not be less than the amount provided for in such Note to be then
due and payable before any such deduction or withholding for or on account of
any such tax, assessment or governmental charge; provided, however, that the
foregoing obligation to pay such additional amounts shall not apply to:
(a) any tax, assessment or other governmental charge which would not
have been so imposed but for (i) the existence of any present or former
connection between such holder (or a fiduciary, settlor, beneficiary,
member or shareholder of, or holder of a power over, such holder, if such
holder is an estate, trust, partnership or corporation) and the United
States, including, without limitation, such holder (or such fiduciary,
settlor, beneficiary, member, shareholder of, or holder of a power) being
or having been a citizen or resident or treated as a resident thereof or
being or having been engaged in a trade or business therein or being or
having been present therein or having or having had a permanent
establishment therein, or (ii) such holder's present or former status as a
personal holding company or foreign personal holding company or controlled
foreign corporation for United States federal income tax purposes or
corporation which accumulates earnings to avoid United States federal
income tax;
(b) any tax, assessment or other governmental charge which would not
have been so imposed but for the presentation by the holder of such Note
for payment on a date more than 10 days after the date on which such
payment became due and payable or the date on which payment thereof is duly
provided for, whichever occurs later;
(c) any estate, inheritance, gift, sales, transfer, personal property
or excise tax or any similar tax, assessment or governmental charge;
(d) any tax, assessment or other governmental charge which is payable
otherwise than by withholding from payments in respect of principal of,
premium, if any, or interest, if any, on any Note;
(e) any tax, assessment or other governmental charge imposed on
interest received by a holder or beneficial owner of a Note who actually or
constructively owns 10% or more of the total combined voting power of all
classes of stock of the Company entitled to vote within the meaning of
Section 871(h)(3) of the United States Internal Revenue Code of 1986, as
amended;
(f) any tax, assessment or other governmental charge imposed as a
result of the failure to comply with (i) certification, information,
documentation, reporting or other similar requirements concerning the
nationality, residence, identity or connection with the United States of
the holder or beneficial owner of the Note, if such compliance is required
by statute, or by regulation of the United States Treasury Department, as a
precondition to relief or exemption from such tax, assessment or other
governmental charge (including backup withholding) or (ii) any other
certification, information, documentation, reporting or other similar
requirements under United States income tax laws or regulations that would
establish entitlement to otherwise applicable relief or exemption from such
tax, assessment or other governmental charge;
(g) any tax, assessment or other governmental charge required to be
withheld by any paying agent from any payment of the principal of, premium,
if any, or interest, if any, on any Note, if such payment can be made
without such withholding by at least one other paying agent; or
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<PAGE> 12
(h) any combination of items (a), (b), (c), (d), (e), (f) or (g);
nor will such additional amounts be paid to any holder who is a fiduciary or
partnership or other than the sole beneficial owner of the Note to the extent a
settlor or beneficiary with respect to such fiduciary or a member of such
partnership or a beneficial owner of the Note would not have been entitled to
payment of such additional amounts had such beneficiary, settlor, member or
beneficial owner been the holder of the Note.
The Notes are subject in all cases to any tax, fiscal or other law or
regulation or administrative or judicial interpretation applicable thereto.
Except as specifically provided under this heading "Payment of Additional
Amounts" and under the heading "Description of Notes--Redemption for Tax
Reasons", the Company shall not be required to make any payment with respect to
any tax, assessment or governmental charge imposed by any government or a
political subdivision or taxing authority thereof or therein.
As used under this heading "Payment of Additional Amounts" and under the
headings "Description of Notes--Redemption for Tax Reasons" and "United States
Federal Taxation--Tax Consequences to Non-United States Persons" the term
"United States" means the United States of America (including the States and the
District of Columbia) and its territories, its possessions and other areas
subject to its jurisdiction. "United States person" means any individual who is
a citizen or resident of the United States, a corporation, partnership or other
entity created or organized in or under the laws of the United States or any
political subdivision thereof or any estate or trust the income of which is
subject to United States federal income taxation regardless of its source and
"non-United States person" has the meaning set forth in "United States Federal
Taxation--Tax Consequences to Non-United States Persons" below.
REDEMPTION FOR TAX REASONS
If, as a result of any change in or amendment to the laws (including any
regulations or rulings promulgated thereunder) of the United States or any
political subdivision thereof or therein affecting taxation, or any change in
the official application or interpretation of such laws, including any official
proposal for such a change, amendment or change in the application or
interpretation of such laws, which change, amendment, application or
interpretation is announced or becomes effective after the date of this
prospectus supplement or which proposal is made after such date, or as a result
of any action taken by any taxing authority of the United States which action is
taken or becomes generally known after such date, or any commencement of a
proceeding in a court of competent jurisdiction in the United States after such
date, whether or not such action was taken or such proceeding was brought with
respect to the Company, there is, in such case, in the written opinion of
independent legal counsel of recognized standing to the Company, a material
increase in the probability that the Company has or may become obligated to pay
Additional Amounts (as described above under "Payment of Additional Amounts"),
and the Company in its business judgment, determines that such obligation cannot
be avoided by the use of reasonable measures available to the Company, not
including assignment of the Notes, the Notes may be redeemed, as a whole but not
in part, at the option of the Company at any time thereafter, upon notice to the
Trustee and the holders of the Notes in accordance with the provisions of the
Indenture at a redemption price equal to 100% of the principal amount of the
Notes to be redeemed together with accrued interest thereon to the date fixed
for redemption.
NOTICES
Notices to holders of the Notes will be published in authorized daily
newspapers in The City of New York, in London, and, so long as the Notes are
listed on the Luxembourg Stock Exchange, in Luxembourg. It is expected that
publication will be made in The City of New York in The Wall Street Journal, in
London in the Financial Times, and in Luxembourg in the Luxemburger Wort. Any
such notice shall be deemed to have been given on the date of such publication
or, if published more than once, on the date of the first such publication.
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UNITED STATES FEDERAL TAXATION
The following summary describes the material United States federal income
and certain estate tax consequences of ownership and disposition of the Notes.
This summary provides general information only and is directed solely to
original holders purchasing Notes at the "issue price", that is, the first price
to the public at which a substantial amount of the Notes 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"), existing administrative pronouncements and judicial
decisions, existing and proposed Treasury Regulations currently in effect, 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 Notes held as
capital assets within the meaning of Section 1221 of the Code. This summary does
not discuss all of the tax consequences that may be relevant to a holder in
light of his particular circumstances or to holders subject to special rules,
such as certain financial institutions, insurance companies, dealers in
securities, persons holding Notes in connection with a hedging transaction,
"straddle," conversion transaction or other integrated transaction or persons
who have ceased to be United States citizens or to be taxed as resident aliens.
Persons considering the purchase of Notes should consult their tax advisors with
regard to the application of the United States federal income and estate tax
laws to their particular situations as well as any tax consequences arising
under the laws of any state, local or foreign taxing jurisdiction.
TAX CONSEQUENCES TO UNITED STATES PERSONS
For purposes of the following discussion, "United States person" means a
beneficial owner of a Note that is for United States federal income tax purposes
(i) a citizen or resident of the United States, (ii) a corporation, partnership
or other entity created or organized in or under the laws of the United States
or of any political subdivision thereof, (iii) an estate the income of which is
subject to United States federal income taxation regardless of its source, or
(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.
Payments of Interest
Interest on a Note will generally be taxable to a United States person as
ordinary interest income at the time it is accrued or is received in accordance
with the United States person's method of accounting for tax purposes.
Sale, Exchange or Retirement of the Notes
Upon the sale, exchange or retirement of a Note, a United States person
will recognize taxable gain or loss equal to the difference between the amount
realized on the sale, exchange or retirement and the United States person's
adjusted tax basis in the Note. For these purposes, the amount realized does not
include any amount attributable to accrued interest on the Note. Amounts
attributable to accrued interest are treated as interest as described under
"Payments of Interest" above. A United States person's adjusted tax basis in a
Note generally will equal the cost of the Note to the United States person.
In general, gain or loss realized on the sale, exchange or redemption of a
Note will be capital gain or loss. Prospective investors should consult their
tax advisors 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 losses (the deductibility of which is subject to limitations).
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Backup Withholding and Information Reporting
Backup withholding and information reporting requirements may apply to
certain payments of principal, premium and interest on a Note, and to payments
of proceeds of the sale or redemption of a Note, to certain non-corporate United
States persons. The Company, its agent, a broker, or any paying agent, as the
case may be, will be required to withhold from any payment a tax equal to 31
percent of such payment if the United States person fails to furnish or certify
his correct taxpayer identification number to the payor in the manner required,
fails to certify that such United States person is not subject to backup
withholding, or otherwise fails to comply with the applicable requirements of
the backup withholding rules. Any amounts withheld under the backup withholding
rules from a payment to a United States person may be credited against such
United States person's United States federal income tax and may entitle such
United States person to a refund, provided that the required information is
furnished to the United States Internal Revenue Service.
TAX CONSEQUENCES TO NON-UNITED STATES PERSONS
As used herein, the term "non-United States person" means an owner of a
Note that is, for United States federal income tax purposes, (i) a nonresident
alien individual, (ii) a foreign corporation, (iii) a nonresident alien
fiduciary of a foreign estate or trust or (iv) a foreign partnership one or more
of the members of which is, for United States federal income tax purposes, a
nonresident alien individual, a foreign corporation or a nonresident alien
fiduciary of a foreign estate or trust.
Income and Withholding Tax
Subject to the discussion of backup withholding below:
(a) payments of principal and interest on a Note that is beneficially
owned by a non-United States person will not be subject to United States
federal withholding tax; provided, that in the case of interest, (1) (i)
the beneficial owner does not actually or constructively own 10% or more of
the total combined voting power of all classes of stock of the Company
entitled to vote, (ii) the beneficial owner is not a controlled foreign
corporation that is related, directly or indirectly, to the Company through
stock ownership, and (iii) either (A) the beneficial owner of the Note
certifies (generally on an IRS Form W-8) to the person otherwise required
to withhold United States federal income tax from such interest, under
penalties of perjury, that it is not a United States person and provides
its name and address or (B) a securities clearing organization, bank or
other financial institution that holds customers' securities in the
ordinary course of its trade or business (a "financial institution") and
holds the Note certifies to the person otherwise required to withhold
United States federal income tax from such interest, under penalties of
perjury, that such statement has been received from the beneficial owner by
it or by a financial institution between it and the beneficial owner and
furnishes the payor with a copy thereof; (2) the beneficial owner is
entitled to the benefits of an income tax treaty under which the interest
is exempt from United States federal withholding tax and the beneficial
owner of the Note or such owner's agent provides an IRS Form 1001 claiming
the exemption; or (3) the beneficial owner conducts a trade or business in
the United States to which the interest is effectively connected and the
beneficial owner of the Note or such owner's agent provides an IRS Form
4224; provided that in each such case, the relevant certification or IRS
Form is delivered pursuant to applicable procedures and is properly
transmitted to the person otherwise required to withhold United States
federal income tax, and none of the persons receiving the relevant
certification or IRS Form has actual knowledge that the certification or
any statement on the IRS Form is false. After December 31, 2000 and, in
certain circumstances, after December 31, 1998, a new IRS Form W-8 will
replace current IRS Forms W-8, 1001 and 4224;
(b) a non-United States person will not be subject to United States
federal withholding tax on any gain realized on the sale, exchange or other
disposition of a Note unless the gain is effectively connected with the
beneficial owner's trade or business in the United States or, in the case
of an
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<PAGE> 15
individual, the holder is present in the United States for 183 days or more
in the taxable year in which the sale, exchange or other disposition occurs
and certain other conditions are met; and
(c) a Note owned by an individual who at the time of death is not, for
United States estate tax purposes, a citizen or resident of the United
States generally will not be subject to United States federal estate tax as
a result of such individual's death if the individual does not actually or
constructively own 10% or more of the total combined voting power or all
classes of stock of the Company entitled to vote and, at the time of such
individual's death the income on the Note would not have been effectively
connected with a United States trade or business of the individual.
With respect to the certification requirement referred to in subparagraph
(a), for Notes held by a foreign partnership, under current law, the Form W-8
may be provided by the foreign partnership. However, for interest and
disposition proceeds paid with respect to a Note after December 31, 2000 and, in
certain circumstances, after December 31, 1998, unless the foreign partnership
has entered into a withholding agreement with the IRS, a foreign partnership
will be required, in addition to providing an intermediary Form W-8, to attach
an appropriate certification by each partner. Prospective investors, including
foreign partnerships and their partners, should consult their tax advisors
regarding possible additional reporting requirements.
If a non-United States person holding a Note is engaged in a trade or
business in the United States, and if interest on the Note (or gain realized on
its sale, exchange or other disposition) is effectively connected with the
conduct of such trade or business, such holder, although exempt from the
withholding tax discussed in the preceding paragraphs, will generally be subject
to regular United States income tax on such effectively connected income in the
same manner as if it were a United States person. Such a holder may also need to
provide a United States taxpayer identification number on the forms referred to
in paragraph (a) above in order to meet the requirements set forth above. In
addition, if such holder is a foreign corporation, it may be subject to a 30%
branch profits tax (unless reduced or eliminated by an applicable treaty) of its
effectively connected earnings and profits for the taxable year, subject to
certain adjustments. For purposes of the branch profits tax, interest on, and
any gain recognized on the sale, exchange or other disposition of, a Note will
be included in the effectively connected earnings and profits of such holder if
such interest or gain, as the case may be, is effectively connected with the
conduct by such holder of a trade or business in the United States.
Each holder of a Note should be aware that if it does not properly provide
the required IRS form, or if the IRS form (or, if permissible, a copy of such
form) is not properly transmitted to and received by the United States person
otherwise required to withhold United States federal income tax, interest on the
Note may be subject to United States withholding tax at a 30% rate and the
holder (including the beneficial owner) will not be entitled to any additional
amounts from the Company described under the heading "Description of
Notes-Payment of Additional Amounts" with respect to such tax. Such tax,
however, may in certain circumstances be allowed as a refund or as a credit
against such holder's United States federal income tax. The foregoing does not
deal with all aspects of federal income tax withholding that may be relevant to
foreign holders of the Notes. Investors are advised to consult their own tax
advisors for specific advice concerning the ownership and disposition of Notes.
Backup Withholding and Information Reporting
Under current Treasury Regulations, backup withholding (imposed at the rate
of 31%) will not apply to payments made by the Company or a paying agent to a
holder in respect of a Note if the certifications required by Sections 871(h)
and 881(c) of the Code, which are described above, are received, provided in
each case that the Company or the paying agent, as the case may be, does not
have actual knowledge that the payee is a United States person.
Under current Treasury Regulations, payments of the proceeds from the sale,
exchange or other disposition of a Note made to or through a foreign office of a
broker (including a custodian, nominee or other agent acting on behalf of the
beneficial owner of a Note) generally will not be subject to information
reporting or backup withholding. However, if such broker is a United States
person, a controlled foreign
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<PAGE> 16
corporation for United States federal tax purposes, a foreign person 50% or more
of whose gross income is effectively connected with a United States trade or
business for a specified three-year period, or in the case of payments made
after December 31, 2000 and, in certain circumstances, payments made after
December 31, 1998, a foreign partnership with certain connections with the
United States, then information reporting will be required unless the broker has
in its records documentary evidence that the beneficial owner is not a United
States person and certain other conditions are met or the beneficial owner
otherwise establishes an exemption. Backup withholding may apply to any payment
that such broker is required to report if such broker has actual knowledge that
the payee is a United States person. Payments to or through the United States
office of a broker are subject to information reporting and backup withholding
unless the holder or beneficial owner certifies, under penalties of perjury that
it is a non-United States person and that it satisfies certain other conditions
or otherwise establishes an exemption from information reporting and backup
withholding.
Non-United States persons holding Notes should consult their tax advisors
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 a separate tax, but is allowed as a refund or credit against the holder's
United States federal income tax, provided the necessary information is
furnished to the Internal Revenue Service.
Interest on a Note that is beneficially owned by a non-United States person
will be reported annually on IRS Form 1042S, which must be filed with the
Internal Revenue Service and furnished to such beneficial owner.
The United States federal income tax discussion set forth above is included
for general information only and may not be applicable depending upon a holder's
particular situation. Holders should consult their own tax advisors with respect
to the tax consequences to them of the ownership and disposition of the Notes,
including the tax consequences under state, local, foreign and other tax laws
and the possible effects of changes in federal or other tax laws.
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UNDERWRITING
Subject to the terms and conditions set forth in an underwriting agreement
dated June 10, 1999 (the "Underwriting Agreement"), the Company has agreed to
sell to each of the underwriters named below, and each of the underwriters, for
whom J.P. Morgan Securities Inc. and Morgan Stanley & Co. Incorporated are
acting as representatives (collectively, the "Representatives"), has severally
agreed to purchase the principal amount of the Notes 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 Notes
offered hereby if any of the Notes are purchased.
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
UNDERWRITERS OF NOTES
------------ ----------------
<S> <C>
J.P. Morgan Securities Inc. ................................ $ 642,500,000
Morgan Stanley & Co. Incorporated........................... 642,500,000
Bear, Stearns & Co. Inc. ................................... 25,000,000
Lehman Brothers International (Europe)...................... 25,000,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated.......... 25,000,000
Salomon Smith Barney Inc. .................................. 25,000,000
Warburg Dillon Read LLC..................................... 25,000,000
ABN AMRO Incorporated....................................... 10,000,000
Barclays Bank PLC........................................... 10,000,000
Banc of America Securities LLC.............................. 10,000,000
Banc One Capital Markets, Inc. ............................. 10,000,000
Chase Securities Inc. ...................................... 10,000,000
Credit Suisse First Boston Corporation...................... 10,000,000
Deutsche Bank AG London..................................... 10,000,000
Midland Bank plc............................................ 10,000,000
Westdeutsche Landesbank Girozentrale........................ 10,000,000
--------------
Total........................................... $1,500,000,000
==============
</TABLE>
The Representatives of the underwriters have advised the Company that they
propose initially to offer the Notes to the public at the offering price set
forth on the cover page of this prospectus supplement and to certain dealers at
such price less a concession not in excess of .1625% of the principal amount of
the Notes. After the initial public offering, the public offering price and
concession may be changed.
The Company has agreed to indemnify the underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as amended.
The Notes are offered for sale in those jurisdictions in the United States,
Europe, Asia and Canada where it is legal to make such offers. Only offers and
sales of the Notes in the United States, as part of the initial distribution
thereof or in connection with resales thereof under circumstances where this
prospectus supplement and the accompanying prospectus must be delivered, are
made pursuant to the Registration Statement of which the prospectus, as
supplemented by this prospectus supplement, is a part.
Each underwriter has represented and agreed that it will comply with all
applicable laws and regulations in force in any jurisdiction in which it
purchases, offers, sells or delivers the Notes or possesses or distributes this
prospectus supplement or the accompanying prospectus and will obtain any
consent, approval or permission required by it for the purchase, offer or sale
by it of the Notes under the laws and regulations in force in any jurisdiction
to which it is subject or in which it makes such purchases, offers or sales and
neither the Company nor any other underwriter shall have responsibility
therefor.
Each underwriter, severally and not jointly, represents and agrees that:
(i) it has not offered or sold and will not offer or sell any Notes to
persons in the United Kingdom prior to the expiry of the period of six
months from the issue date of the Notes except to persons whose ordinary
activities involve them in acquiring, holding, managing or disposing of
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<PAGE> 18
investments (as principal or agent) for the purposes of their businesses or
otherwise in circumstances which have not resulted and will not result in
an offer to the public in the United Kingdom within the meaning of the
Public Offers of Securities Regulations 1995;
(ii) it has only issued or passed on and will only issue or pass on in
the United Kingdom any document received by it in connection with the issue
of the Notes to a person who is of a kind described in Article 11(3) of the
Financial Services Act 1986 (Investment Advertisements) (Exemptions) Order
1996, as amended, or is a person to whom such document may otherwise
lawfully be issued or passed on; and
(iii) it has complied and will comply with all applicable provisions
of the Financial Services Act 1986 with respect to anything done by it in
relation to any Notes in, from or otherwise involving the United Kingdom.
Although application has been made to list the Notes on the Luxembourg
Stock Exchange, the Notes are a new issue of securities with no established
trading market. No assurance can be given as to the liquidity of, or the trading
markets for, the Notes. The Company has been advised by the underwriters that
they intend to make a market in the Notes, but they are not obligated to do so
and may discontinue such market-making at any time without notice.
Purchasers of the Notes may be required to pay stamp taxes and other
charges in accordance with the laws and practices of the country of purchase in
addition to the issue price set forth on the cover page hereof.
In connection with the sale of the Notes, certain of the underwriters may
engage in transactions that stabilize, maintain or otherwise affect the price of
the Notes. Specifically, the underwriters may overallot the offering, creating a
short position. In addition, the underwriters may bid for, and purchase, the
Notes in the open market to cover short positions or to stabilize the price of
the Notes. Any of these activities may stabilize or maintain the market price of
the Notes 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.
In the ordinary course of their respective businesses, certain of the
underwriters or their affiliates have engaged, and will in the future engage, in
commercial banking and investment banking transactions with the Company and
certain of its affiliates.
GENERAL INFORMATION
Application has been made to list the Notes on the Luxembourg Stock
Exchange. In connection with the listing application, the Certificate of
Incorporation and the By-Laws of the Company and a legal notice relating to the
issuance of the Notes have been deposited prior to listing with the Greffier en
Chef du Tribunal d'Arrondissement de et a Luxembourg, where copies thereof may
be obtained upon request. Copies of the above documents together with this
prospectus supplement, the accompanying prospectus, the Indenture and the
Company's Annual Report on Form 10-K for the year ended December 31, 1998 as
well as all Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K filed since December 31, 1998, so long as any of the
Notes are outstanding, will be made available for inspection at the main office
of Banque Generale du Luxembourg S.A. Banque Generale du Luxembourg S.A. will
act as intermediary between the Luxembourg Stock Exchange and the Company and
the holders of the Notes. In addition, copies of the Annual Reports and
Quarterly Reports and Current Reports of the Company may be obtained free of
charge at such office.
Except as may be disclosed herein, there has been no material change in the
financial or trading position of the Company since December 31, 1998.
The Company is not a party to any legal or arbitration proceedings
(including any that are pending or threatened) which may have or have had during
the previous 12 months a significant effect on the Company's consolidated
financial position.
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<PAGE> 19
The Notes have been accepted for clearance through Euroclear and Cedelbank
and have been assigned Euroclear and Cedelbank Common Code No. 9878203,
International Security Identification Number (ISIN) US370425RJ12 and CUSIP No.
370425RJ1.
LEGAL OPINIONS
The validity of the Notes offered hereby will be passed on for the Company
by Martin I. Darvick, Esq., Assistant General Counsel of the Company, 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.
The firm of Davis Polk & Wardwell acts as counsel to the Executive
Compensation Committee of the Board of Directors of General Motors Corporation
and has acted as counsel for General Motors Corporation and the Company in
various matters.
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<PAGE> 20
REGISTERED OFFICES OF THE COMPANY
3044 West Grand Boulevard
Detroit, Michigan 48202
United States
LEGAL AND TAX ADVISORS
TO THE COMPANY
(As to United States Law)
MARTIN I. DARVICK, ESQ.
3031 West Grand Boulevard
Detroit, Michigan 48202
United States
(As to United States Law)
PETER F. HILTZ, ESQ.
3044 West Grand Boulevard
Detroit, Michigan 48202
United States
AUDITORS
Independent Auditors
of the Company
DELOITTE & TOUCHE LLP
600 Renaissance Center
Detroit, Michigan 48243-1274
United States
LEGAL ADVISORS TO THE UNDERWRITERS
(As to United States Law)
DAVIS POLK & WARDWELL
450 Lexington Avenue
New York, New York 10017
United States
LISTING AGENT
BANQUE GENERALE DU LUXEMBOURG S.A.
50 Avenue J. F. Kennedy
L-2951 Luxembourg
TRUSTEE
THE BANK OF NEW YORK
101 Barclay Street
Floor 7E
New York, New York 10286
United States
PAYING AND TRANSFER AGENT IN LUXEMBOURG
BANQUE GENERALE DU LUXEMBOURG S.A.
50 Avenue J. F. Kennedy
L-2951 Luxembourg
<PAGE> 21
PROSPECTUS
$10,000,000,000
GENERAL MOTORS ACCEPTANCE CORPORATION
DEBT SECURITIES, WARRANTS TO PURCHASE DEBT SECURITIES
------------------------
We will offer from time to time debt securities or warrants to purchase debt
securities. We will provide the specific terms of these securities in
supplements to this prospectus. You should read this prospectus and any
supplemental prospectus carefully before you invest.
------------------------
We reserve the sole right to accept and, together with our agents from time to
time, to reject in whole or in part any proposed purchase of securities to be
made directly or through any agents.
------------------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, or determined if
this prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
------------------------
APRIL 15, 1999
<PAGE> 22
You should rely only on the information contained in or incorporated by
reference in this prospectus or any accompanying supplemental prospectus. We
have not authorized anyone to provide you with different information or to make
any additional representations. We are not making an offer of these securities
in any state where the offer is not permitted. You should not assume that the
information contained in or incorporated by reference in this prospectus and any
prospectus supplement is accurate as of any date other than the date on the
front of each of those documents.
TABLE OF CONTENTS
<TABLE>
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PAGE
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<S> <C>
Principal Executive Offices................................. 2
Available Information....................................... 2
Incorporation of Certain Documents by Reference............. 3
Description of General Motors Acceptance Corporation........ 4
Ratio of Earnings to Fixed Charges.......................... 4
Use of Proceeds............................................. 4
Description of Debt Securities.............................. 5
Description of Warrants..................................... 10
Plan of Distribution........................................ 11
Experts..................................................... 12
</TABLE>
Unless the context indicates otherwise, the words "GMAC", "we", "our",
"ours" and "us" refer to General Motors Acceptance Corporation.
Any agent's commissions or dealer or underwriter's discounts in relation to
the sale of securities covered by this prospectus will be set forth in the
applicable prospectus supplement. The net proceeds we receive from such sale
will be (a) the purchase price of the securities less such agent's commission,
(b) the purchase price of the securities, in the case of a dealer or (c) the
public offering price of the securities less such underwriter's discount. There
will be an additional deduction from the proceeds in the case of (a), (b) and
(c), for other attributable issuance expenses. Our aggregate proceeds from all
securities sold will be the purchase price of the securities sold less the
aggregate of the agents' commissions, the underwriter discounts and any other
expenses of issuance and distribution.
------------------------
PRINCIPAL EXECUTIVE OFFICES
Our principal executive offices are located at 3044 West Grand Boulevard,
Detroit, Michigan 48202, and our telephone number is 313-556-5000.
------------------------
AVAILABLE INFORMATION
We file annual, quarterly, and special reports and other information with
the SEC. You may read and copy any reports or other information we file at the
public reference room of the SEC located at 450 Fifth Street, N.W., Washington,
D.C. 20549. You may also inspect our filings at the following Regional Offices
of the SEC located at Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511 and Seven World Trade Center, Suite 1300, New York,
New York 10048. You may also request copies of our documents upon payment of a
duplicating fee, by writing to the SEC's Public Reference Room. You may obtain
information regarding the Public Reference Room by calling the SEC at
1-800-SEC-0330. SEC filings are also available to the public from commercial
document retrieval services and over the
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<PAGE> 23
Internet at http://www.sec.gov. Reports and other information can also be
inspected at the offices of the New York Stock Exchange, Inc., 20 Broad Street,
New York, New York 10005.
We have filed with the SEC a registration statement on Form S-3 (together
with all amendments and exhibits, the "registration statement") under the
Securities Act of 1933 with respect to the securities. This prospectus, which
constitutes part of the registration statement, does not contain all of the
information set forth in the registration statement. Certain parts of the
registration statement are omitted from the prospectus in accordance with the
rules and regulations of the SEC.
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. 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 GMAC and its finances.
<TABLE>
<CAPTION>
SEC FILINGS (FILE NO. 1-3754) PERIOD
----------------------------- ------
<S> <C>
Annual Report on Form 10-K............... Year ended December 31, 1998
Current Report on Form 8-K............... Dated January 21, 1999
</TABLE>
You may request a copy of the documents incorporated by reference in this
prospectus, except exhibits to such prospectus, at no cost, by writing or
telephoning the office of G. E. Gross, Comptroller, at the following address and
telephone number:
General Motors Acceptance Corporation
3044 West Grand Boulevard
Mail code 482-1x1-103
Detroit, Michigan 48202
Tel: (313) 556-1240
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<PAGE> 24
DESCRIPTION OF GENERAL MOTORS ACCEPTANCE CORPORATION
General Motors Acceptance Corporation, a wholly-owned subsidiary of General
Motors Corporation, was incorporated in 1997 under the Delaware General
Corporation Law. On January 1, 1998, GMAC merged with its predecessor which was
originally incorporated in 1919 under the New York Banking Law relating to
investment companies, and thereupon assumed all of its predecessor's assets,
liabilities and obligations. Operating directly and through subsidiaries and
associated companies in which we have equity investments, we offer a wide
variety of automotive financial services to and through franchised General
Motors dealers in many countries throughout the world. Financial services also
are offered to other automobile dealerships and to the customers of those
dealerships. Other financial services we offer include insurance and mortgage
banking.
Our principal businesses are:
- to finance the acquisition by franchised General Motors dealers for
resale of various new automotive and nonautomotive products manufactured
by General Motors Corporation;
- to acquire from such dealers, either directly or indirectly, installment
obligations covering retail sales and leases of new General Motors
products as well as used units of any make;
- to finance new products of other manufacturers; and
- to lease motor vehicles and certain types of capital equipment to others.
The automotive financing industry is highly competitive. Our principal
competitors are affiliated finance subsidiaries of other major manufacturers as
well as a large number of banks, commercial finance companies, savings and loan
associations and credit unions. Our business is influenced by our ability to
offer competitive financing rates which in turn is directly affected by our
access to capital markets.
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
------------------------------------------------
1998 1997 1996 1995 1994
---- ---- ---- ---- ----
<S> <C> <C> <C> <C>
1.33 1.42 1.41 1.36 1.33
</TABLE>
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 GMAC 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.
USE OF PROCEEDS
The net proceeds from the sale of the securities will be added to the
general funds of GMAC and will be available for the purchase of receivables, the
making of loans or the repayment of debt. Such proceeds initially may be used to
reduce short-term borrowings or invested in short-term securities.
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<PAGE> 25
DESCRIPTION OF DEBT SECURITIES
The debt securities offered are to be issued under an Indenture dated as of
July 1, 1982, as amended by:
- a First Supplemental Indenture dated as of April 1, 1986
- a Second Supplemental Indenture dated as of June 15, 1987
- a Third Supplemental Indenture dated as of September 30, 1996
- a Fourth Supplemental Indenture dated as of January 1, 1998
- a Fifth Supplemental Indenture dated as of September 30, 1998
and as further amended by the Trust Indenture Reform Act of 1990 (together, the
"Indenture"), between GMAC and The Bank of New York, Successor Trustee (the
"Trustee"), copies of which are filed as exhibits to the registration statement.
The following summaries of certain provisions of the Indenture are not complete
and are subject to all provisions of the Indenture, including the definition of
certain terms.
The Indenture provides that, in addition to the debt securities being
offered, additional debt securities may be issued without limitation as to
aggregate principal amount, but only as authorized by GMAC's Board of Directors.
(Section 2.01 of the Indenture.)
GENERAL
Reference is made to the accompanying prospectus supplement for the
following terms of the debt securities being offered:
- the designation of the debt securities;
- the aggregate principal amount of the debt securities;
- the percentage of their principal amount at which the debt securities
will be issued;
- the date or dates on which the debt securities will mature;
- the rate or rates per annum, if any, at which the debt securities will
bear interest;
- the times at which the interest will be payable;
- the date after which the debt securities may be redeemed and the
redemption price;
- the currency or currencies in which the debt securities are issuable or
payable;
- the exchanges on which the debt securities may be listed; and
- whether the debt securities shall be issued in book-entry form.
Principal and interest, if any, will be payable, and, unless the debt
securities are issued in book-entry form, the debt securities being offered will
be transferable, at the principal corporate trust office of the Trustee, which
at the date hereof is 101 Barclay Street, New York, New York 10286, provided
that payment of interest may be made at the option of GMAC by check mailed to
the address of the person entitled thereto. (Sections 2.06, 4.01, and 4.02 of
the Indenture.)
The debt securities will be unsecured and unsubordinated and will rank pari
passu with all other unsecured and unsubordinated obligations of GMAC (other
than obligations preferred by mandatory provisions of law).
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. Federal income tax consequences and other special
considerations applicable to any such discounted debt securities will be
described in the accompanying prospectus supplement.
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<PAGE> 26
Debt securities will include debt securities denominated in United States
dollars or, at the option of GMAC if so specified in the accompanying prospectus
supplement, in any other freely transferable currency.
If a prospectus supplement specifies that debt securities are denominated
in a currency other than United States dollars, the prospectus supplement will
also specify the denomination in which such debt securities will be issued and
the coin or currency in which the principal, premium, if any, and interest on
the debt securities, where applicable, 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.
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. GMAC 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, DELIVERY AND FORM
Unless otherwise indicated in the accompanying prospectus supplement, the
debt securities will be issued in the form of one or more fully registered
global securities (collectively, the "Global Debt Security") which will be
deposited with, or on behalf of, The Depository Trust Company, New York, New
York (the "Depositary" or "DTC") and registered in the name of the Depositary's
nominee. Except as set forth below, the Global Debt Security 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.
The Depositary has advised as follows: it is a limited-purpose trust
company which was created to hold securities for its participating organizations
and to facilitate the clearance and settlement of securities transactions
between participants in such securities through electronic book-entry changes in
accounts of its participants. Participants include:
- securities brokers and dealers, including the underwriters named in the
accompanying prospectus supplement;
- banks and trust companies;
- clearing corporations; and
- certain other organizations.
Access to the Depositary's 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 the
Depositary only through participants or indirect participants.
The Depositary advises that pursuant to procedures established by it:
- upon issuance of the debt securities by GMAC, the Depositary will credit
the account of participants designated by the underwriters with the
principal amounts of the debt securities purchased by the underwriters;
and
- ownership of beneficial interests in the 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
participants' interests), the participants and the indirect participants
(with respect to the owners of beneficial interests in the Global Debt
Security).
The laws of some states require that certain persons take physical delivery
in definitive form of securities which they own. Consequently, the ability to
transfer beneficial interests in the Global Debt Security is limited to such
extent.
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<PAGE> 27
As long as the Depositary's nominee is the registered owner of the Global
Debt Security, such nominee for all purposes will be considered the sole owner
or holder of the debt securities under the Indenture. Except as provided below,
owners of beneficial interests in the Global Debt Security will not:
- be entitled to have any of the debt securities registered in their names,
- receive or be entitled to receive physical delivery of the debt
securities in definitive form, or
- be considered the owners or holders thereof under the Indenture.
Neither GMAC, the Trustee, any Paying Agent nor the Depositary will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of the Global Debt
Security, or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
Principal and interest payments on the debt securities registered in the
name of the Depositary's nominee will be made by the Trustee to the Depositary's
nominee as the registered owner of the Global Debt Security. Under the terms of
the Indenture, GMAC and the Trustee will treat the persons in whose names the
debt securities are registered as the owners of the debt securities for the
purpose of receiving payment of principal and interest on the debt securities
and for all other purposes whatsoever. Therefore, neither GMAC, the Trustee nor
any Paying Agent has any direct responsibility or liability for the payment of
principal or interest on the debt securities to owners of beneficial interests
in the Global Debt Security. The Depositary has advised GMAC and the Trustee
that its present practice is, upon receipt of any payment of principal or
interest, to immediately credit the accounts of the Participants with such
payment in amounts proportionate to their respective holdings in principal
amount of beneficial interests in the Global Debt Security as shown on the
records of the Depositary. Payments by participants and indirect participants to
owners of beneficial interests in the Global Debt Security will be the
responsibility of such participants and indirect participants and will be
governed by their standing instructions and customary practices, as is now the
case with securities held for the accounts of customers in bearer form or
registered in "street name".
If the Depositary is at any time unwilling or unable to continue as
depositary and a successor depositary is not appointed by GMAC within 90 days,
GMAC will issue debt securities in definitive form in exchange for the Global
Debt Security. In addition, GMAC may at any time determine not to have the debt
securities represented by the Global Debt Security and, in such event, will
issue debt securities in definitive form in exchange for the Global Debt
Security. In either instance, an owner of a beneficial interest in a Global Debt
Security will be entitled to have debt securities equal in principal amount to
the beneficial interest registered in its name and will be entitled to physical
delivery of the 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. No service
charge will be made for any transfer or exchange of the debt securities, but
GMAC may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith. (Section 2.06 of the
Indenture.)
DTC has advised GMAC that management of DTC is aware that some computer
applications, systems, and the like for processing data ("Systems") that are
dependent upon calendar dates, including dates before, on, or after January 1,
2000, may encounter "Year 2000 problems." DTC has informed its participants and
other members of the financial community (the "Industry") that it has developed
and is implementing a program so that its Systems, as the same relate to the
timely payment of distributions, including principal and income payments, to
securityholders, book-entry deliveries, and settlement of trades within DTC,
continue to function appropriately. This program includes a technical assessment
and a remediation plan, each of which is complete. Additionally, DTC's plan
includes a testing phase, which, DTC has advised the Industry, is expected to be
completed within appropriate time frames.
However, DTC's ability to properly perform its services is also dependent
upon other parties, including, but not limited to, issuers and their agents, as
well as DTC's participants and indirect participants and third party vendors
from whom DTC licenses software and hardware, and third party
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<PAGE> 28
vendors on whom DTC relies for information or the provision of services,
including telecommunication and electrical utility service providers, among
others. DTC has informed the Industry that it is contacting (and will continue
to contact) third party vendors from whom DTC acquires services to: (a) impress
upon them the importance of such services being "Year 2000" compliant; and (b)
determine the extent of their efforts for "Year 2000" remediation (and, as
appropriate, testing) of their services. In addition, DTC is in the process of
developing such contingency plans as it deems appropriate. According to DTC, the
foregoing information with respect to DTC has been provided to the Industry for
informational purposes only and is not intended to serve as a representation,
warranty, or contract modification of any kind.
CERTAIN COVENANTS AS TO LIENS
The only financial covenant applicable to the debt securities is that
described below. That covenant requires that the debt securities be equally and
ratably secured in the circumstances described therein but has no special
application merely by virtue of the occurrence of any transaction or series of
transactions resulting in material changes in GMAC's debt-to-equity ratio.
The debt securities are not secured by mortgage, pledge or other lien. GMAC
will covenant in the debt securities that so long as any of the debt securities
remain outstanding, it will not pledge or otherwise subject to any lien any of
its property or assets unless the debt securities are secured by such pledge or
lien equally and ratably with any and all other obligations and indebtedness
secured thereby so long as any such other obligations and indebtedness shall be
so secured. Such covenant does not apply to:
- the pledge of any assets to secure any financing by GMAC of the exporting
of goods to or between, or the marketing thereof in, foreign countries
(other than Canada), in connection with which GMAC reserves the right, in
accordance with customary and established banking practice, to deposit,
or otherwise subject to a lien, cash, securities or receivables, for the
purpose of securing banking accommodations or as the basis for the
issuance of bankers' acceptances or in aid of other similar borrowing
arrangements;
- the pledge of receivables payable in foreign currencies (other than
Canadian dollars) to secure borrowings in foreign countries (other than
Canada);
- any deposit of assets of GMAC with any surety company or clerk of any
court, or in escrow, as collateral in connection with, or in lieu of, any
bond on appeal by GMAC from any judgment or decree against it, or in
connection with other proceedings in actions at law or in equity by or
against GMAC;
- any lien or charge on any property, tangible or intangible, real or
personal, existing at the time of acquisition of such property (including
acquisition through merger or consolidation) or given to secure the
payment of all or any part of the purchase price thereof or to secure any
indebtedness incurred prior to, at the time of, or within 60 days after,
the acquisition thereof for the purpose of financing all or any part of
the purchase price thereof; and
- any extension, renewal or replacement (or successive extensions, renewals
or replacements), in whole or in part, of any lien, charge or pledge
referred to in the foregoing four clauses of this paragraph; provided,
however, that the amount of any and all obligations and indebtedness
secured thereby shall not exceed the amount thereof so secured
immediately prior to 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 charge or lien so extended,
renewed or replaced (plus improvements on such property). (Section 4.03
of the Indenture.)
MODIFICATION OF THE INDENTURE
The Indenture contains provisions permitting GMAC 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 66 2/3% in aggregate principal amount of the
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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:
- 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 thereon, without the consent of the holder of each
debt security so affected, or
- reduce the aforesaid percentage of debt securities, the consent of the
holders of which is required for any such modification, without the
consent of the holders of all debt securities then outstanding under the
Indenture. (Section 10.02 of the Indenture.)
EVENTS OF DEFAULT
An Event of Default with respect to any series of debt securities issued
subject to the Indenture is defined in the Indenture as being:
- default in payment of any principal or premium, if any, on such series;
- default for 30 days in payment of any interest on such series;
- default for 30 days after notice in performance of any other covenant in
the Indenture; or
- 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 as set out in the first, second and third items listed above
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 as set out in the
fourth item listed above 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 on such debt security for which payment had not been subsequently made.
(Section 6.01 of the Indenture.) GMAC is required to file with the Trustee
annually an Officers' Certificate as to the absence of certain defaults under
the terms of the Indenture. (Section 4.05 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, if it
considers it in the interest of the securityholders to do so. (Section 6.07 of
the Indenture.)
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 or security. (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 principal amount of the
debt securities of each series affected, with each series voting as a separate
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.)
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CONCERNING THE TRUSTEE
The Bank of New York is the Successor Trustee under the Indenture. It is
also Successor Trustee under various other indentures covering outstanding notes
and debentures of GMAC. The Bank of New York and its affiliates act as
depository for funds of, make loans to, act as trustee and perform certain other
services for, GMAC and certain of its affiliates in the normal course of its
business. As trustee of various trusts, it has purchased securities of GMAC and
certain of its affiliates.
DESCRIPTION OF WARRANTS
GENERAL
The following statements with respect to the warrants are summaries of the
detailed provisions of one or more separate warrant agreements (each a "Warrant
Agreement") between GMAC and a banking institution organized under the laws of
the United States or one of the states thereof (each a "Warrant Agent"), a form
of which is filed as an exhibit to the registration statement. 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, if any, offered thereby for the terms of, and
other information with respect to, such warrants, including:
- the title and the aggregate number of warrants;
- the debt securities for which each warrant is exercisable;
- the date or dates on which the warrants will expire;
- the price or prices at which the warrants are exercisable;
- the currency or currencies in which the warrants are exercisable;
- the periods during which and places at which the warrants are
exercisable;
- the terms of any mandatory or optional call provisions;
- 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;
- the identity of the Warrant Agent;
- the exchanges, if any, on which the warrants may be listed; and
- whether the Warrants shall be issued in book-entry form.
EXERCISE OF WARRANTS
Warrants 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
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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.
PLAN OF DISTRIBUTION
GMAC may sell the securities being offered in four ways:
- directly to purchasers,
- through agents,
- through underwriters, and
- through dealers.
Offers to purchase securities may be solicited directly by GMAC or by
agents designated by GMAC 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 GMAC to
such agent set forth, in the prospectus supplement. Unless otherwise indicated
in the prospectus supplement, any such agent will be acting on a best efforts
basis for the period of its appointment, which is ordinarily five business days
or less. Agents may be entitled under agreements which may be entered into with
GMAC to indemnification by GMAC 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 GMAC in the ordinary course of
business.
If an underwriter or underwriters are utilized in the sale, GMAC 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 GMAC 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:
<TABLE>
<S> <C>
- Bear, Stearns & Co. Inc. - J.P. Morgan Securities Inc.
- Lehman Brothers - Morgan Stanley Dean Witter
- Lehman Brothers Inc. - Morgan Stanley & Co. Incorporated
- Merrill Lynch & Co. - Salomon Smith Barney
- Merrill Lynch, Pierce, Fenner & Smith - Salomon Brothers Inc
Incorporated
- J.P. Morgan & Co. - Warburg Dillon Read LLC
</TABLE>
If a dealer is utilized in the sale of the securities in respect of which
this prospectus is delivered, GMAC 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 GMAC against certain liabilities, including
liabilities under the Securities Act of 1933.
If so indicated in the prospectus supplement, GMAC will authorize agents
and underwriters to solicit offers by certain institutions to purchase
securities from GMAC at the public offering price set forth in the prospectus
supplement pursuant to delayed delivery contracts providing for payment and
delivery on the date stated in the prospectus supplement. Each delayed delivery
contract will be for an amount not less than, and unless GMAC otherwise agrees
the aggregate principal amount of securities sold pursuant to
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delayed delivery contracts shall be not less nor more than, the respective
amounts stated in the prospectus supplement. Institutions with whom delayed
delivery contracts, when authorized, may be made include:
- commercial and savings banks,
- insurance companies,
- pension funds,
- investment companies,
- educational and charitable institutions, and
- other institutions.
All delayed delivery contracts are subject to the approval of GMAC. Delayed
delivery contracts will not be subject to any conditions except that the
purchase by an institution of the securities covered by its delayed delivery
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 prospectus supplement will be paid to underwriters
and agents soliciting purchases of securities pursuant to contracts accepted by
GMAC.
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.
In connection with the sale of the securities, certain of the underwriters
may engage in transactions that stabilize, maintain or otherwise affect the
price of the securities. Specifically, the underwriters may overallot the
offering, creating a short position. In addition, the underwriters may bid for,
and purchase, the securities in the open market to cover short positions or to
stabilize the price of the securities. Any of these activities may stabilize or
maintain the market price of the securities 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.
EXPERTS
The consolidated financial statements incorporated in this prospectus by
reference from GMAC's Annual Report on Form 10-K for the year ended December 31,
1998 have been audited by Deloitte & Touche LLP, independent auditors, as stated
in their report, which is incorporated herein by reference, and have been so
incorporated in reliance upon the report of such firm given upon their authority
as experts in accounting and auditing.
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