Filed Under Rule 424(b)(3)
File Number 33-49309
PROSPECTUS
15,000,000 SHARES
GENERAL MOTORS CORPORATION
$1 2/3 PAR VALUE COMMON STOCK
DIVIDEND REINVESTMENT PLAN
Amended Effective July 1, 1995
The Dividend Reinvestment Plan (the "Plan") of General Motors
Corporation ("General Motors" or the "Corporation") has been modified
effective July 1, 1995 to provide each stockholder of any of the Corporation's
$1 2/3 par value common stock ("$1 2/3 par value common stock"), Class E
Common Stock, $0.10 par value ("Class E Common Stock") or Class H Common
Stock, $0.10 par value ("Class H Common Stock") (collectively referred to as
the Corporation's "Common Stocks") with a simple, convenient and economical
method of reinvesting cash dividends and/or making optional cash investments
in order to purchase additional shares of $1 2/3 par value common stock.
Although holders of Class E Common Stock and Class H Common Stock may
participate, the Plan provides only for the purchase of $1 2/3 par value
common stock (see Question 5).
Participants in the amended Plan may acquire shares of $1 2/3 par value
common stock beginning on July 1, 1995 by:
- Automatically reinvesting all or a portion of the cash dividends on one
or more of the Corporation's Common Stocks in additional shares of
$1 2/3 par value common stock (subject to a $100,000 quarterly maximum
amount limitation which may be waived by the Corporation -- see Question
20); or
- Making optional cash investments totalling not less than $25.00 nor more
than $4,000 per monthly cycle, whether they are reinvesting all, a part,
or none of their cash dividends (see Question 23).
Participants currently enrolled in the Plan will continue to participate
until their participation is modified or terminated by written request to Bank
of Boston (the "Plan Administrator") at the address specified in Question 3.
Stockholders who have not already enrolled and want to do so should simply
complete an Authorization Form and return it to the Plan Administrator at the
address specified in Question 3. Authorization Forms may be obtained from the
Plan Administrator at the address or telephone number specified in Question
3.
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This Prospectus relates to 15,000,000 shares of $1 2/3 par value common
stock, authorized and unissued or held in the treasury of the Corporation,
registered for sale under the Plan. This Prospectus should be retained for
future reference.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
The date of this Prospectus is July 1, 1995.
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TABLE OF CONTENTS
Page
Available Information............................................. 3
Incorporation of Certain Documents by Reference................... 4
General Motors Corporation ....................................... 5
Use of Proceeds................................................... 5
Description of General Motors Corporation Dividend
Reinvestment Plan............................................... 5
Purposes and Advantages..................................... 6
Administration.............................................. 7
Participation............................................... 8
Costs....................................................... 11
Purchases................................................... 12
Dividend Reinvestment....................................... 14
Optional Cash Investments................................... 15
Reports to Participants..................................... 18
Issuance of Stock Certificates for Shares Purchased
Under Plan................................................ 18
Safekeeping-Putting Additional Stock Certificates
in Custody................................................ 20
Sale of Shares in Plan Accounts............................. 22
Taxation.................................................... 22
Other Information........................................... 24
Legal Opinion..................................................... 26
Experts........................................................... 27
NO PERSON HAS BEEN AUTHORIZED BY THE CORPORATION TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN AS CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER
CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
CORPORATION.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL, OR THE
SOLICITATION OF AN OFFER TO BUY, THE SECURITIES TO WHICH THIS PROSPECTUS
RELATES IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH
AN OFFER OR SOLICITATION IN SUCH JURISDICTION.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER
SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE CORPORATION SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS
DATE.
AVAILABLE INFORMATION
General Motors is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy statements and other information filed by General Motors with
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the Commission can be inspected, and copies may be obtained, at the Public
Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549-1004, at prescribed rates, as well as at the following Regional Offices
of the Commission: Seven World Trade Center, New York, New York 10048; and
Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-
2511. Reports, proxy statements and other information concerning General
Motors can also be inspected at the offices of the New York Stock Exchange,
Inc., 11 Wall Street, New York, New York 10005, where the $1 2/3 par value
common stock, Class E Common Stock and Class H Common Stock of General Motors
are listed and at the offices of the following other stock exchanges where the
$1 2/3 par value common stock is listed: the Chicago Stock Exchange, Inc.,
One Financial Place, 440 South LaSalle Street, Chicago, Illinois 60605; the
Pacific Stock Exchange, Inc., 233 South Beaudry Avenue, Los Angeles,
California 90012 and 301 Pine Street, San Francisco, California 94104; and the
Philadelphia Stock Exchange, Inc., 1900 Market Street, Philadelphia,
Pennsylvania 19103.
General Motors has filed with the Commission a Registration Statement
on Form S-3 (the "Registration Statement") under the Securities Act of 1933,
as amended, covering the shares described herein. This Prospectus does not
contain all of the information set forth in the Registration Statement,
certain parts of which are omitted in accordance with the rules and
regulations of the Commission. For further information, reference is hereby
made to the Registration Statement.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by General Motors with
the Commission, are incorporated herein by reference:
l. Annual Report on Form 10-K for the year ended December 31, 1994,
as amended on Forms 10-K/A dated March 17 and 24, 1995 (as
amended, the "1994 Form 10-K");
2. Quarterly Report on Form 10-Q for the quarter ended March 31,
1995;
3. Current Reports on Form 8-K dated March 3, 13, 24 and May 30,
1995; and
4. The description of the $1 2/3 par value common stock set forth in
Article Fourth of the restated General Motors Certificate of
Incorporation, as amended to May 26, 1994, filed as Exhibit 3(i)
to the General Motors Current Report on Form 8-K dated May 26,
1994.
All documents filed by General Motors with the Commission pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Prospectus and prior to the termination of the offering of the shares offered
hereby shall be deemed to be incorporated by reference in this Prospectus and
to be a part hereof from the date of filing of such documents. Any statement
contained herein or in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for purposes
of this Prospectus to the extent that a statement contained herein or in any
other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
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General Motors will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon the written or
oral request of such person, a copy of any or all of the documents which have
been or may be incorporated by reference in this Prospectus, other than
exhibits to such documents not specifically described above. Requests for
such documents should be directed to General Motors Corporation, Room 11-243,
General Motors Building, 3044 West Grand Boulevard, Detroit, Michigan 48202-
3091 (Telephone Number (313) 556-2044).
GENERAL MOTORS CORPORATION
While the major portion of General Motors' operations is derived from
the automotive products industry segment, General Motors also has financing
and insurance operations and produces products and provides services in other
industry segments. The automotive products segment consists of the design,
manufacture, assembly and sale of automobiles, trucks and related parts and
accessories. General Motors financing and insurance operations assist in the
merchandising of General Motors' products as well as other products. General
Motors Acceptance Corporation ("GMAC") and its subsidiaries offer financial
services and certain types of insurance to dealers and customers. In
addition, GMAC and its subsidiaries are engaged in mortgage banking and
investment services. General Motors' other products segment consists of
military vehicles, radar and weapon control systems, guided missile systems
and defense and commercial satellites; the design, installation and operation
of business information and telecommunications systems; as well as the design,
development and manufacture of locomotives. For additional information on
General Motors, see the General Motors 1994 Form 10-K which is incorporated
herein by reference, and the other documents incorporated herein by reference.
The Corporation's principal executive offices are located at 3044 West
Grand Boulevard, Detroit, Michigan 48202-3091 (Telephone Number (313) 556-
5000), and 767 Fifth Avenue, New York, New York 10153-0075 (Telephone Number
(212) 418-6100).
USE OF PROCEEDS
The Corporation does not know the number of original issue shares, if
any, of $1 2/3 par value common stock that may ultimately be offered under the
Plan, the prices at which they may be offered or the timing of offerings, the
last being at the sole discretion of the Corporation. If shares of original
issues $1 2/3 par value common stock are issued, the net proceeds received
therefrom will be added to the Corporation's general funds to be used for
general Corporate purposes.
DESCRIPTION OF GENERAL MOTORS CORPORATION DIVIDEND REINVESTMENT PLAN
The following questions and answers constitute the provisions of the
General Motors Corporation Dividend Reinvestment Plan (the "Plan") under which
General Motors Corporation ("General Motors" or the "Corporation") will sell,
and holders of the Corporation's Common Stock, $1 2/3 par value ("$1 2/3 par
value common stock"), Class E Common Stock, $0.10 par value ("Class E Common
Stock"), or Class H Common Stock, $0.10 par value ("Class H Common Stock")
(together, the Corporation's "Common Stocks") may purchase, shares of $1 2/3
par value common stock through the automatic reinvestment of cash dividends
paid on shares of the Corporation's Common Stocks and/or through optional cash
investments.
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PURPOSES AND ADVANTAGES
1. WHAT IS THE PURPOSE OF THE PLAN?
The Plan provides eligible holders of the Corporation's Common Stocks
with a simple, convenient and economical method of reinvesting cash dividends
and/or making optional cash investments to purchase additional shares of
$1 2/3 par value common stock. The shares of $1 2/3 par value common stock
acquired under the Plan will be purchased by the Plan Administrator (see
Question 3) either from the Corporation or on the open market (see Question
16). To the extent that shares are purchased from the Corporation, the
Corporation will receive additional funds to be used for general corporate
purposes.
2. WHAT ARE THE ADVANTAGES OF THE PLAN?
Stockholders participating in the Plan (each, a "participant") can enjoy
the following advantages:
FULL INVESTMENT. Full investment of funds is possible under the Plan
because fractions of shares of $1 2/3 par value common stock, as well
as whole shares, will be credited to a participant's account. Further,
dividends on such fractions, as well as whole shares, will be reinvested
in additional shares of $1 2/3 par value common stock that will also be
credited to a participant's account.
SAFEKEEPING. A participant avoids the need for safekeeping of
certificates for shares of $1 2/3 par value common stock purchased for
a participant's Plan account because such certificates are held in trust
for the participant by the Plan Administrator. In addition, a
participant may deposit for safekeeping in his or her Plan account any
stock certificates for the Corporation's $1 2/3 par value common stock,
Class E Common Stock and Class H Common Stock registered in such
participant's name(s) through the free custodial service described in
Question 33. Dividends on shares deposited for safekeeping under the
Plan may also be reinvested in shares of $1 2/3 par value common stock.
By making such a deposit, a participant is relieved of the
responsibility for loss, theft or destruction of the stock certificates.
LOWER BROKERAGE FEES. Brokerage commissions on shares of $1 2/3 par
value common stock purchased or sold on the open market by the Plan
Administrator will be lower than those normally incurred by an
individual private investor given the commission economies achievable
by pooling accounts and purchasing or selling a large number of shares
at any one time (see Questions 13 and 35). There will be no brokerage
fees if shares of $1 2/3 par value common stock are purchased by the
Plan Administrator from the Corporation.
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OPTIONAL CASH INVESTMENTS. In addition to reinvesting dividends,
participants may purchase shares of $1 2/3 par value common stock by
making optional cash investments totalling not less than $25.00 nor more
than $4,000 per month by sending funds to the Plan Administrator (see
Question 21).
RECORD-KEEPING. Regular statements of account will be mailed to each
participant in the Plan as soon as practicable after each purchase of
$1 2/3 par value common stock under the Plan. Such statements will show
the date of the investment, the amounts invested, the purchase price,
the number of shares purchased, the total number of shares accumulated
in the participant's account and comparable information for all previous
transactions for the year to date, thus providing simplified record-
keeping (see Question 28).
ADMINISTRATION
3. WHO ADMINISTERS THE PLAN FOR PARTICIPANTS?
A plan administrator (the "Plan Administrator") will administer the Plan
for participants, maintain records, send statements of account activity to
participants and perform other duties relating to the Plan. The Plan
Administrator will hold for safekeeping shares of $1 2/3 par value common
stock purchased for, or the Corporation's Common Stocks deposited for
safekeeping by, each participant until termination of participation in the
Plan or receipt of a written request from a participant for the issuance of
a certificate for all or a portion of such shares.
Bank of Boston has been designated by the Corporation as its agent to
serve as Plan Administrator. Bank of Boston also serves as dividend
disbursing agent, principal transfer agent and registrar of the Corporation's
Common Stocks.
Shares of $1 2/3 par value common stock purchased under the Plan and
held by the Plan Administrator will be registered in its name or the name of
one of its nominees. As the record holder of shares of the Corporation's
Common Stocks held for participants under the Plan, the Plan Administrator
will receive dividends on such shares of the Corporation's Common Stocks, will
credit such dividends to each participant's account on the basis of full and
fractional shares held in each account, and will automatically reinvest such
dividends in additional shares of $1 2/3 par value common stock, as the
participant has so elected. In the event that the Plan Administrator should
resign or otherwise cease to act as agent, the Corporation will make such
other arrangements as it deems appropriate for the administration of the Plan.
The Corporation and/or the Plan Administrator may adopt rules and regulations
to facilitate the administration of the Plan (see Questions 39 and 46). Costs
of Plan administration are paid by the Corporation, except where a participant
requests a sale of any shares of the Corporation's Common Stocks or where the
Plan Administrator purchases shares of $ 1 2/3 par value common stock on the
open market (see Question 13).
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All correspondence regarding the Plan should refer to General Motors
Corporation and be addressed to:
Bank of Boston
General Motors Dividend Reinvestment Plan
P.O. Box 9255
Boston, MA 02205-9255
Telephone inquiries may be made to Bank of Boston at 1-800-331-9922.
PARTICIPATION
4. WHO IS ELIGIBLE TO PARTICIPATE?
Two types of stockholders are eligible to be participants: (a)
stockholders whose shares of the Corporation's Common Stocks are registered
in their own names on the Corporation's stock transfer records ("registered
owners") and (b) stockholders who beneficially own shares of the Corporation's
Common Stocks that are registered in a name other than their own (i.e., in the
name of a broker, bank or other nominee) ("beneficial owners"). Registered
owners may participate directly in the Plan. Beneficial owners may
participate in the Plan by either becoming registered owners which requires
having such shares transferred into their own names or by making arrangements
with their broker, bank or other nominee to participate on their behalf (see
Questions 8, l9 and 22). Savings and benefit plans of the Corporation and of
its subsidiaries and participants in such plans are not eligible to
participate in the Plan in respect of the Corporation's Common Stocks
contained in such savings and benefit plans (see Question 7).
A stockholder who is currently participating in the existing Plan by
reinvesting all or part of his or her dividends will automatically remain
enrolled in the amended Plan. A stockholder who wishes to change
participation in any way under the Plan must submit a new Authorization Form
(see Questions 10, 11 and 12) or, if a stockholder wishes to withdraw from or
cease participation in the amended Plan, the stockholder must submit a
withdrawal request (see Question 34).
The right to participate in the Plan is not transferable to another
person apart from a transfer of a participant's underlying shares of the
Corporation's Common Stocks.
Stockholders who reside in jurisdictions in which it is unlawful for the
Corporation to permit their participation are not eligible to participate in
the Plan.
5. CAN THE CORPORATION'S CLASS E COMMON STOCK AND CLASS H COMMON STOCK
STOCKHOLDERS PARTICIPATE IN THE PLAN?
Both Class E Common Stock and Class H Common Stock stockholders can
participate in the Plan in the same manner as $1 2/3 par value stockholders.
It should be noted, however, that any dividends reinvested or optional cash
investments made by such stockholders will be used only to acquire shares of
$1 2/3 par value common stock. Neither Class E Common Stock nor Class H
Common Stock can be purchased pursuant to the Plan.
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6. ARE HOLDERS OF ANY OF THE CORPORATION'S SERIES OF PREFERENCE STOCKS
ELIGIBLE TO PARTICIPATE IN THE Plan?
No. Only holders of one of the Corporation's three classes of Common
Stock are eligible to participate in the Plan.
7. ARE THE CORPORATION'S EMPLOYEES OR THE EMPLOYEES OF ANY OF ITS
SUBSIDIARIES ELIGIBLE TO PARTICIPATE THROUGH ONE OR MORE OF THE
CORPORATION'S OR ANY OF ITS SUBSIDIARIES' BENEFIT OR SAVINGS PLANS, SUCH
AS THE GENERAL MOTORS SAVINGS-STOCK PURCHASE PROGRAM?
No. Savings and other benefit plans of the Corporation and of its
subsidiaries and participants in such plans are not eligible to participate
in the Plan in respect of the Corporation's Common Stocks contained in such
benefit and savings plans. However, employees of the Corporation or any of
its subsidiaries can participate in the Plan by reinvesting dividends on any
of the Corporation's Common Stocks that they may own outside of a corporate
benefit or savings plan and are otherwise eligible to participate under the
guidelines specified in Question 4.
8. HOW DOES AN ELIGIBLE STOCKHOLDER PARTICIPATE?
A registered holder of any of the Corporation's Common Stocks not
already enrolled in the Plan may participate by completing and signing an
Authorization Form and returning it to the Plan Administrator. An
Authorization Form may be obtained at any time by written or telephone request
to the Plan Administrator at the address and phone number specified in
Question 3.
If a participant's shares are registered in more than one name or a
representative capacity is indicated (i.e., joint tenants, trustees, etc.),
all registered holders must sign the Authorization Form exactly as their names
appear in the Corporation's stock transfer records.
A beneficial owner who wishes to participate in the Plan, but whose
shares are held in the name of a broker, bank or other nominee, must make
arrangements with his or her broker, bank or other nominee who in turn will
make arrangements with the Plan Administrator. See Question l9 for
information regarding the reinvestment of dividends by beneficial owners. See
Question 22 for information regarding optional cash investments by beneficial
owners.
Current participants in the existing Plan who wish to continue to
reinvest their cash dividends or who wish to make optional cash investments
do not need to complete and return a new Authorization Form. If a stockholder
returns a properly executed Authorization Form to the Plan Administrator
without electing an investment option, such Authorization Form will be deemed
to indicate the intention of such stockholder to apply all cash dividends on
the Corporation's Common Stocks and any optional cash investments toward the
purchase of additional shares of $1 2/3 par value common stock.
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9. WHEN MAY ELIGIBLE STOCKHOLDERS ENROLL IN THE PLAN AND WHEN IS SUCH
ENROLLMENT EFFECTIVE?
An eligible stockholder may enroll in the Plan at any time. Enrollment
is effective when the Authorization Form is received and processed by the Plan
Administrator. If an Authorization Form specifying reinvestment of dividends
is received by the Plan Administrator on or before the record date established
for a particular dividend payment, reinvestment will commence with that
dividend. Dividend payment dates for the Corporation's Common Stocks are
ordinarily the tenth of March, June, September and December. In the past,
record dates for General Motors have generally preceded the dividend payment
dates by approximately one month. It is anticipated that dividend record
dates and payment dates for the Corporation's Common Stocks in the future will
be approximately the same times of the year as they currently are scheduled
to occur. If the Authorization Form is received after the record date
established for a particular dividend, the dividend will be paid in cash and
the reinvestment of dividends will not begin until the dividend payment date
following the next record date.
An eligible stockholder may also enroll in the Plan through the timely
delivery of an Authorization Form and an optional cash payment (see Question
21). See Questions 14 and 26 for information concerning the timing of
optional cash investments.
Once enrolled, participants remain enrolled until their participation
is discontinued or until the Plan is terminated (see Questions 31, 34 and 39).
10. IS PARTIAL PARTICIPATION POSSIBLE UNDER THE PLAN?
Yes. A stockholder who owns more than one class of the Corporation's
Common Stocks may indicate on the Authorization Form which class(es) ($1 2/3
par value common stock, Class E Common Stock, and/or Class H Common Stock) he
or she wishes to have eligible for dividend reinvestment. In addition, a
stockholder who desires to reinvest less than all of his or her total
dividends for the class(es) selected may indicate such percentage of total
cash dividends to be reinvested in 25% increments (see Question ll).
ll. WHAT DOES THE AUTHORIZATION FORM PROVIDE?
The Authorization Form is designed to be used by an eligible stockholder
whose shares are registered in his or her name to enroll in the Plan and
provides for the reinvestment of dividends and/or the making of optional cash
investments.
The Authorization Form provides for the following:
(a) Permits eligible stockholders to enroll in the Plan and directs
the Plan Administrator to invest in accordance with the Plan the participant's
cash dividends on any and/or all classes of the Corporation's Common Stocks
then or subsequently registered in the participant's name. The Authorization
Form also permits a stockholder who desires to reinvest less than all of his
or her total dividends available for the class(es) selected to indicate such
a percentage in 25% increments. In each case, dividends will be reinvested
on the class(es) of the Corporation's Common Stocks and percentage of total
dividends designated on the Authorization Form, until a participant specifies
otherwise in a new Authorization Form or withdraws from the Plan altogether,
or until the Plan is terminated. See Questions 31, 34 and 39 for more
information about termination of participation. All enrolled participants are
also permitted to make optional cash investments for the purchase of
additional shares of the Corporation's $1 2/3 par value common stock in
accordance with the Plan; or
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(b) Permits eligible stockholders to enroll in the Plan and make
optional cash investments for the purchase of additional shares of the
Corporation's $1 2/3 par value common stock in accordance with the Plan even
if none of the participant's cash dividends on shares registered in the
participant's name are being reinvested under the Plan; and
(c) Permits a participant in the Plan to change his or her
participation in the Plan at any time, by completing and sending a new
Authorization Form to the Plan Administrator.
The Authorization Form permits eligible stockholders who are not already
participating in the existing Plan to enroll in the amended Plan. A
stockholder who is currently participating in the existing Plan will
automatically remain enrolled in the amended Plan and need not submit a new
Authorization Form. However, should a participant desire to change
participation in any manner, the participant may do so by completing and
sending a new Authorization Form to the Plan Administrator.
12. HOW MAY PARTICIPANTS CHANGE INVESTMENT OPTIONS UNDER THE PLAN?
A participant may change investment options at any time by requesting
a new Authorization Form and returning it to the Plan Administrator at the
address specified in Question 3. A request for a new Authorization Form may
be made by contacting the Plan Administrator at the address or telephone
number specified in Question 3. Changes in investment options are effective
when the Plan Administrator receives and processes a properly signed and
completed Authorization Form (see Question 9). See Question 34 on how a
participant may withdraw from and cease participation in the Plan.
COSTS
13. ARE THERE ANY EXPENSES TO A PARTICIPANT IN CONNECTION WITH PURCHASES AND
SALES UNDER THE PLAN?
There are no costs if shares of $1 2/3 par value common stock are
purchased by the Plan Administrator from the Corporation. Under the Plan, the
Corporation may sell original issue shares or treasury shares of $1 2/3 par
value common stock to the Plan Administrator (see Question 16). In such
cases, no cost whatsoever is incurred by the participant. Only if the Plan
Administrator purchases shares on the open market will the cost of brokerage
commissions be passed on to participants. However, these commissions are
lower than those normally incurred by an individual private investor given the
commission economies achievable by pooling accounts and purchasing or selling
a large number of shares at any one time.
In addition, if a participant requests the Plan Administrator to sell
shares of the Corporation's Common Stocks held in a participant's Plan
account, any brokerage commissions, fees and applicable transfer taxes paid
in connection with such sale will be deducted from the proceeds of any such
sale along with a $5.00 service charge for each class of General Motors Common
Stock sold (see Question 35).
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All costs of record-keeping, reporting, custody and administration of
the Plan will be paid by the Corporation. There is no charge for the issuance
of a stock certificate for $1 2/3 par value common stock purchased under the
Plan. See Question 29 for more information on obtaining a stock certificate
for shares held in a Plan account.
PURCHASES
14. WHEN WILL SHARES OF $1 2/3 PAR VALUE COMMON STOCK BE PURCHASED UNDER THE
PLAN?
Dividends and optional cash investments will be reinvested or invested,
as the case may be, on the "Investment Date." The Investment Date for the
reinvestment of dividends is each dividend payment date (see Question 9). The
Investment Date for optional cash investments is each 20th day of the month.
Optional cash investments must be received by the Plan Administrator no later
than three business days preceding the relevant Investment Date. Should the
Investment Date for optional cash investments in any month fall on a Saturday,
Sunday or any other day on which banking institutions in Boston, Massachusetts
are authorized or obligated to close, the Investment Date will be the
following trading day. All shares of $1 2/3 par value common stock purchased
with optional cash investments on the February, May, August and November
Investment Dates will not be entitled to dividends declared and payable in the
next succeeding month.
NO INTEREST WILL BE PAID BY THE CORPORATION OR THE PLAN ADMINISTRATOR
ON DIVIDENDS OR OPTIONAL CASH INVESTMENTS HELD BY THE PLAN ADMINISTRATOR
PENDING REINVESTMENT OR INVESTMENT. PARTICIPANTS ARE THEREFORE STRONGLY URGED
TO TRANSMIT THEIR OPTIONAL CASH INVESTMENTS SO AS TO BE RECEIVED BY THE PLAN
ADMINISTRATOR PRIOR TO THE THIRD BUSINESS DAY PRECEDING THE INVESTMENT DATE
FOR OPTIONAL CASH INVESTMENTS (SEE QUESTIONS 26 AND 27).
15. HOW ARE SHARES OF $1 2/3 PAR VALUE COMMON STOCK ACQUIRED UNDER THE PLAN
AND HOW MANY SHARES WILL BE PURCHASED FOR A PARTICIPANT?
The Plan Administrator will apply any dividends and any optional cash
investments to the purchase of $1 2/3 par value common stock pursuant to the
Plan on the applicable Investment Date, except when prohibited under
applicable federal or state securities laws. For the purpose of making
purchases, the Plan Administrator will commingle the funds of all
participants.
The number of shares of $1 2/3 par value common stock to be purchased
for each participant's Plan account for a given Investment Date will be
determined by the amount of optional cash investments, if any, made by or on
behalf of the participant, the amount of the dividends, if any, being
reinvested and the price paid by the Plan Administrator for the $1 2/3 par
value common stock. The entire amount of the dividends being reinvested will
be used to purchase additional shares, except in the case of certain
participants subject to income tax withholding (see Question 36). Each
participant's Plan account will be credited with that number of shares of
$1 2/3 par value common stock, including fractional shares rounded to three
decimal places, purchased for the participant's Plan account equal to the
total amount to be invested divided by the purchase price per share. The
Corporation will pay to the Plan Administrator cash dividends on all or that
percentage of shares (including Plan shares) of the Corporation's Common
Stocks authorized by each participant in accordance with the participant's
directions on the Authorization Form. The Plan Administrator will apply to
the purchase of additional Plan shares of $1 2/3 par value common stock such
dividends and any optional cash investments received by the Plan Administrator
from or on behalf of the participant prior to the applicable Investment Date.
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16. WHAT IS THE SOURCE OF THE SHARES OF $1 2/3 PAR VALUE COMMON STOCK TO BE
SOLD UNDER THE PLAN?
Prior to the record date for any dividend payment date or Investment
Date for optional cash investment, the Corporation will determine the source
of the shares of $1 2/3 par value common stock needed to satisfy the
requirements of the Plan for that dividend reinvestment or optional cash
investment. The source of the shares of $1 2/3 par value common stock shall
be either original issue shares or treasury shares purchased directly from the
Corporation by the Plan Administrator, outstanding shares purchased by the
Plan Administrator on the open market, or any combination of the above
sources.
17. WHAT WILL BE THE PER-SHARE PRICE OF $1 2/3 PAR VALUE COMMON STOCK
PURCHASED THROUGH THE PLAN?
ORIGINAL ISSUE AND TREASURY SHARES
The per-share price of original issue $1 2/3 par value common stock and
treasury shares of $1 2/3 par value common stock purchased from the
Corporation with reinvested dividends and/or optional cash investments will
be the average of the high and low market prices of the Corporation's $1 2/3
par value common stock as reported in the Composite Tape of transactions as
reported in THE WALL STREET JOURNAL, EASTERN EDITION on the relevant
Investment Date. No shares of $1 2/3 par value common stock will be sold by
the Corporation at less than the par value of such shares.
OPEN MARKET PURCHASES
The per-share price of outstanding $1 2/3 par value common stock
purchased on the open market with reinvested dividends and/or optional cash
investments on behalf of all participants will be the average cost of all
shares so purchased, including brokerage commissions but excluding other fees
paid by the Corporation (see Questions 13 and 35). The Plan Administrator
will make every effort to invest promptly, on and after each relevant
Investment Date, and in no event more than 30 days after the Plan
Administrator's receipt thereof, all dividends and optional cash investments
paid to it, except where and to the extent that any applicable Federal
securities law may otherwise require. Such purchases may be made on any
securities exchange where the Corporation's $1 2/3 par value common stock is
traded, in the over-the-counter market, or by negotiated transactions and may
be subject to such terms and conditions, including price and delivery, as the
Plan Administrator may agree to. Neither the Corporation nor any participant
shall have any authority or power to direct the time or price at which shares
of $1 2/3 par value common stock may be purchased or the selection of the
broker or dealer through or from whom purchases are to be made.
- 13 -<PAGE>
DIVIDEND REINVESTMENT
18. HOW DOES THE DIVIDEND REINVESTMENT PLAN WORK?
On each dividend payment date a participant's full or partial cash
dividends will be remitted to the Plan Administrator in accordance with such
participant's directions on the Authorization Form submitted to the Plan
Administrator (see Question ll). The Plan Administrator will reinvest such
dividends, as well as the cash dividends on shares of $1 2/3 par value common
stock previously credited to the participant's Plan account in accordance with
the participant's directions. Dividends on a fractional share of $1 2/3 par
value common stock contained in a Plan account will also be reinvested in
additional shares of $1 2/3 par value common stock. Purchases of $1 2/3 par
value common stock will be made by the Plan Administrator as outlined in
Question 15.
l9. HOW DOES A STOCKHOLDER OF GENERAL MOTORS COMMON STOCKS NOT ALREADY
ENROLLED IN THE PLAN REINVEST DIVIDENDS HELD IN THE NAME OF A BROKER,
BANK OR OTHER NOMINEE?
In the event that a stockholder is not a registered holder, and a
broker, bank or other nominee holds the stockholder's stock in its name or at
a securities depository in the United States, reinvestment of dividends must
be made through such broker, bank or other nominee. The beneficial owner's
broker, bank or other nominee must in turn instruct its own nominee to make
arrangements with the Plan Administrator each time such beneficial owner
wishes to reinvest a quarterly dividend. It may do so by contacting the Plan
Administrator at 1-800-331-9922.
20. ARE THERE ANY MAXIMUM OR MINIMUM LIMITATIONS ON THE AMOUNT A PARTICIPANT
CAN INVEST UNDER THE DIVIDEND REINVESTMENT PROVISIONS OF THE PLAN?
There is no minimum limitation on the amount a participant can invest
under the dividend reinvestment provisions of the Plan, although stockholders
are subject to a quarterly maximum of $100,000 per participant; however, a
participant wishing to reinvest dividends in excess of $100,000 may do so by
first obtaining the specific approval of the Corporation. Requests for such
approval should be directed to the Plan Administrator at 1-800-331-9922 no
later than three business days before the next Investment Date. It is totally
within the Corporation's discretion whether to grant any such approval for any
dividend reinvestment in excess of the allowable quarterly maximum amount and
such approvals may be made from time to time.
- 14 -<PAGE>
OPTIONAL CASH INVESTMENTS
21. HOW DOES A PARTICIPANT MAKE OPTIONAL CASH INVESTMENTS?
Each month the Plan Administrator will apply any optional cash
investment payment in good funds timely received by the Plan Administrator
from a participant to the purchase of $1 2/3 par value common stock for the
account of the participant on the next Investment Date. See Questions 14 and
26 for when optional cash investments received by the Plan Administrator will
be invested.
All registered holders of the Corporation's Common Stocks who have
submitted a signed Authorization Form are eligible to make optional cash
investments at any time. A beneficial owner whose shares are held in the name
of a broker, bank, other nominee or securities depository may not make
optional cash investments.
Eligible registered holders may make optional cash investments by
mailing to the Plan Administrator, at the address specified in Question 3, a
check or money order payable to "Bank of Boston-General Motors," accompanied
by either a completed and signed Authorization Form or the tear-off portion,
properly completed and signed, which is attached to each participant's Plan
account statement. Payment methods available include personal checks drawn
on United States-domiciled financial institutions or money market mutual
funds, cashier's checks, money orders, Federal Reserve Bank checks and
travelers checks. Items such as drafts and warrants, and checks drawn on
foreign-domiciled financial institutions are not acceptable due to the longer
clearance periods. Other forms of payment, including wire transfers, may be
made only if the participant makes prior arrangements with the Plan
Administrator. Cash should never be sent. The same amount of money need not
be sent each month and there is no obligation to make an optional cash
investment in any month. Optional cash investments must be made in United
States dollars.
22. MAY A PARTICIPANT MAKE OPTIONAL CASH INVESTMENTS WHEN SHARES ARE HELD
IN THE NAME OF A BROKER, BANK OR OTHER NOMINEE?
No. Optional cash investments may not be made by a participant who is
not a registered holder and whose broker, bank or other nominee holds the
participant's shares in its name or in the name of a securities depository.
23. ARE THERE ANY MAXIMUM OR MINIMUM LIMITATIONS ON THE AMOUNT THAT MAY BE
INVESTED USING OPTIONAL CASH INVESTMENTS?
Except as provided in the following paragraph, for any Investment Date,
optional cash investments are subject to a minimum investment of $25.00 and
a maximum investment of $4,000 per participant per month irrespective of a
participant's shareholdings.
Participants wishing to submit an optional cash payment in excess of
$4,000 may do so by first obtaining the specific approval of the Corporation
no later than three business days prior to the Investment Date. Requests for
such approval should be directed to the Plan Administrator at 1-800-331-9922
only. It is totally within the Corporation's discretion whether to grant any
such approval for any investments in excess of the allowable monthly maximum
investment amount.
- 15 -<PAGE>
Optional cash investments of less than $25.00 and that portion of any
optional cash investment which exceeds the allowable monthly maximum
investment amount and for which approval has not been granted by the
Corporation will be returned to the participant without interest. The
limitations on the amounts of optional cash investments described above are
subject to change at any time by the Corporation. All purchases made with
optional cash investments will appear on the Plan account statement sent to
each participant following such purchases of $1 2/3 par value common stock
pursuant to the Plan (see Question 28).
24. WHAT IF A PARTICIPANT HAS MORE THAN ONE ACCOUNT?
For the purpose of the limitations discussed in Question 23, at the
Corporation's discretion all optional cash investments for holders with more
than one account using the same Social Security or Taxpayer Identification
Number may be aggregated. For holders unable to supply a Social Security or
Taxpayer Identification Number, the holder's participation may, at the
Corporation's discretion, be limited to only one Plan account.
Also for the purpose of such limitations, all Plan accounts which the
Corporation, in its sole judgment, believes to be under common control or
management or to have common ultimate beneficial ownership may be aggregated.
If the Corporation determines that such accounts will be aggregated, unless
the Corporation has also determined that individual investments of optional
cash investments for such accounts would be consistent with the purposes of
the Plan, the Corporation will have the right to return without interest
within 30 days of receipt any amounts in excess of the applicable investment
limitations (see Question 23) received in respect of such accounts.
The Corporation may establish other or additional requirements that
apply to participation in the Plan by brokers, banks and others acting in a
representative capacity on behalf of owners of the Corporation's Common
Stocks. The Corporation reserves the right to decide that future
participation by any participant in the Plan is dependent upon compliance with
all requirements currently in effect applicable to optional cash investments
(see Question 40).
25. MAY A PARTICIPANT PURCHASE A SPECIFIC NUMBER OF SHARES OF $1 2/3 PAR
VALUE COMMON STOCK?
The manner in which the Plan operates does not permit the Corporation
to honor a request that a specific number of shares of $1 2/3 par value common
stock be purchased (see Questions 15 and 17).
- 16 -<PAGE>
26. WHAT ARE THE IMPORTANT DATES APPLICABLE TO OPTIONAL CASH INVESTMENTS?
Optional cash investments may be invested by a participant each month
(see Question 14). In order for funds to be invested on the next Investment
Date, the Plan Administrator must have received a check, money order or wire
transfer (where permitted (see Question 21)) at least three business days
prior to the Investment Date and such check, money order or wire transfer must
have cleared on or before the Investment Date. Checks and money orders are
accepted subject to timely collection as good funds and verification of
compliance with the terms of the Plan. Checks returned to the Plan
Administrator for any reason will not be resubmitted for collection.
In the event that any check is returned unpaid for any reason, the Plan
Administrator will consider the request for investment of such money null and
void and shall immediately remove from the participant's account shares, if
any, purchased upon the prior credit of such money. The Plan Administrator
shall thereupon be entitled to sell these shares to satisfy any uncollected
amounts. If the net proceeds of the sale of such shares are insufficient to
satisfy the balance of such uncollected amounts, the Plan Administrator shall
be entitled to sell such additional shares from the participant's Plan account
to satisfy the uncollected balance.
Optional cash investments received after the Investment Date or not
having cleared as described above will be applied to purchases of $1 2/3 par
value common stock for the next Investment Date (but see Question 27 for
certain circumstances under which optional cash investments may be returned).
No interest will be paid by the Corporation or the Plan Administrator on
optional cash investments held pending investment. Therefore, although
optional cash investments may be made at any time, a participant must mail
them in sufficient time so as to be received by the Plan Administrator at
least three business days prior to the next Investment Date.
In order for optional cash investments to be invested on the next
Investment Date, in addition to the receipt of good funds before such
Investment Date, the Plan Administrator must have received a properly signed
and completed Authorization Form (see Question 21).
27. UNDER WHAT CIRCUMSTANCES MAY A PARTICIPANT RECOVER OPTIONAL CASH
INVESTMENTS OR WILL OPTIONAL CASH INVESTMENTS BE RETURNED?
A participant may, without terminating participation in the Plan,
recover any optional cash investment held for investment upon the
participant's request provided such request is received by the Plan
Administrator at least three business days prior to the Investment Date for
optional cash investments.
Optional cash investments of less than $25.00 and that portion of any
optional cash investment which exceeds the allowable monthly maximum
investment amount will be returned to the participant without interest (see
Question 23).
- 17 -<PAGE>
REPORTS TO PARTICIPANTS
28. WHAT KIND OF REPORTS WILL PLAN PARTICIPANTS RECEIVE?
As soon as practicable after each Investment Date, participants who are
record holders will receive a Plan statement showing the date of the
investment, the amounts invested, the purchase price, the number of shares
purchased, the total number of shares accumulated in the participant's
account, and comparable information for all previous transactions for the year
to date. In addition, such statement will show the number of shares of the
Corporation's Common Stocks, if any, held in the participant's Plan account
for safekeeping and reinvestment of dividends to acquire shares of $1 2/3 par
value common stock. Brokers, banks and other nominees who are participating
on behalf of beneficial owners but who do not belong to a securities
depository will also receive such statements.
Since such statements will reflect a record holder's costs for the
purchase of shares under the Plan, they should be retained for income tax
purposes. The stub of these statements may also be used to request stock
certificates for shares held by a record holder under the Plan and to make
optional cash investments (see Questions 21 and 29).
Annually, the total amount of dividends considered paid to a participant
who is a record holder, including amounts reinvested, and the cash proceeds
from the sale of shares will be reported to such participant, to the Internal
Revenue Service and, if required, to state taxation authorities.
In addition, each participant will receive copies of the same
communications sent to all other stockholders of the Corporation, including
copies of the Corporation's annual and midyear reports to stockholders, a
notice of the annual meeting and accompanying proxy statement. All notices,
statements and reports from the Plan Administrator to a participant will be
addressed to the participant at the participant's last address of record with
the Plan Administrator. Therefore, participants must promptly notify the Plan
Administrator of any change of address (see Question 45).
ISSUANCE OF STOCK CERTIFICATES FOR SHARES PURCHASED UNDER PLAN
29. WILL STOCK CERTIFICATES BE ISSUED FOR SHARES OF $1 2/3 PAR VALUE COMMON
STOCK PURCHASED UNDER THE PLAN?
Except as stated below and in Question 34, the Corporation will not
issue to participants stock certificates for shares of $1 2/3 par value common
stock purchased under the Plan unless requested in writing to do so. A
participant's shares will be held for such participant's account in the name
of the Plan Administrator or its nominee. The number of shares purchased under
the Plan will be shown on the statement of account of each record holder.
This feature protects against loss, theft or destruction of stock
certificates.
In the case of a stockholder whose shares are registered in his or her
name, the Plan account will be maintained in the exact name(s) in which the
stock certificates were registered at the time the participant entered the
Plan and certificates for whole shares will be similarly registered when
issued to the participant. Should a participant want shares registered and
- 18 -<PAGE>
issued in a different name or should the participant want to change the name
in which the Plan account is maintained, a participant must so indicate in a
written request. In such a case, a participant will have to comply with any
applicable stock transfer requirements of the Corporation's transfer agent
(see Question 3). In the case of a beneficial owner, the Plan account will
be maintained in the name of the broker, bank or other nominee and the
beneficial owner will have to contact such broker, banker or other nominee
concerning proposed changes to his or her account.
In addition, stock certificates for all or any number of whole shares
credited to a Plan account will be issued at no charge upon the written
request of a participant, and the shares represented by such certificates will
thereupon be withdrawn from the participant's account. The dividends on
withdrawn shares will be reinvested under the Plan at the same percentage(s)
as the Participant has elected on his or her Authorization Form unless the
participant notifies the Plan Administrator of his or her termination of
participation in the Plan. The request for withdrawal of shares should be
mailed to the Plan Administrator at the address specified in Question 3. In
addition, a participant who is a record holder may also receive a stock
certificate for any or all whole shares held in such participant's Plan
account by appropriately completing the stub of a Plan account statement and
returning it to the Plan Administrator. In no case will stock certificates
for fractional shares be issued. Instead, fractional shares will be paid in
cash. After a partial withdrawal of shares, dividends on any remaining whole
shares and any fractions of a share will continue to be credited to the
participant's account in accordance with the participant's instructions on the
most recently processed Authorization Form (see Question 30). Any request for
stock certificates received on or after a dividend record date may not become
effective until dividends for such record date have been reinvested and the
$1 2/3 par value common stock so purchased is credited to accounts under the
Plan.
Whole shares purchased through a broker, bank or other nominee will be
issued in the form of stock certificates. Dividends on shares for which stock
certificates are issued will be paid in cash or reinvested, as the case may
be, in accordance with a participant's most recent instructions submitted on
an Authorization Form.
30. WILL DIVIDENDS ON SHARES OF GENERAL MOTORS COMMON STOCKS WITHDRAWN FROM
THE PLAN CONTINUE TO BE REINVESTED?
If the participant has authorized "Full Dividend Reinvestment," cash
dividends with respect to shares of General Motors Common Stocks withdrawn
from a participant's account will continue to be reinvested. If, however,
cash dividends with respect to only part of the shares of General Motors
Common Stocks registered in a participant's name are being reinvested, the
Plan Administrator will continue to reinvest dividends on only the
percentage(s) of shares specified by the participant on the most recently
processed Authorization Form received by the Plan Administrator unless a new
Authorization Form specifying a different percentage of shares is delivered.
- 19 -<PAGE>
31. WHAT HAPPENS WHEN A PARTICIPANT SELLS OR TRANSFERS ALL OR A PORTION OF
THE SHARES OF THE CORPORATION'S COMMON STOCKS REGISTERED IN THE
PARTICIPANT'S NAME?
Even if a participant disposes of all of the shares of the Corporation's
Common Stocks registered in the participant's name, the Plan Administrator
will continue to reinvest the dividends on the shares of the Corporation's
Common Stocks that remain credited to the participant's account under the
Plan, as the participant has so elected, until a written request for
withdrawal from the Plan is received from the participant (see Question 34).
If a participant who is reinvesting the cash dividends on part of the
shares of the Corporation's Common Stocks registered in the participant's name
disposes of a portion of such shares, the Plan Administrator will continue to
reinvest the dividends on the remainder of such shares at the designated
percentage(s) of shares of the Corporation's Common Stocks as originally
specified in the participant's Authorization Form.
32. MAY SHARES OF THE CORPORATION'S COMMON STOCKS IN A PLAN ACCOUNT BE
PLEDGED?
Shares of the Corporation's Common Stocks credited to the account of a
participant under the Plan may not be pledged. A participant who wishes to
pledge such shares must withdraw such shares from the Plan by requesting stock
certificates from the Plan Administrator (see Question 29). Any purported
pledge or assignment of shares held under the Plan will not be recognized by
the Plan Administrator.
SAFEKEEPING-PUTTING ADDITIONAL STOCK CERTIFICATES IN CUSTODY
33. WILL THE PLAN ADMINISTRATOR TAKE CUSTODY OF STOCK CERTIFICATES FOR THE
CORPORATION'S COMMON STOCKS HELD BY A PARTICIPANT OUTSIDE THE PLAN?
Participants who are record holders may add stock certificates for $1
2/3 par value common stock, Class E Common Stock and Class H Common Stock held
outside the Plan to the shares of $1 2/3 par value common stock held in
custody in a participant's Plan account by the Plan Administrator. This may
be done by sending stock certificates with a letter of instruction to the Plan
Administrator at the address specified in Question 3. Participants may
deliver such certificates to the Plan Administrator along with the
Authorization Form when enrolling in the Plan, or may do so at any time
thereafter while participating in the Plan. Since mailing stock certificates
will expose participants to the risk of loss, it is recommended that such
certificates be sent by registered mail, return receipt requested, and
properly insured. The stock certificates need not be endorsed.
Dividends on additional shares placed in custody may be automatically
reinvested in such manner as the participant may so elect (see Question 18).
- 20 -<PAGE>
34. HOW MAY A PARTICIPANT WITHDRAW FROM AND CEASE PARTICIPATION IN THE PLAN?
A participant may withdraw from and cease participation in the Plan at
any time by giving written notice to the Plan Administrator at the address
specified in Question 3, which notice clearly indicates the participant's
intention to terminate participation in the Plan. As soon as practicable
following withdrawal, the Plan Administrator will send the participant at no
charge stock certificates for the whole shares of the Corporation's Common
Stocks in the participant's Plan account and a cash payment will be made for
any fraction of a share of $1 2/3 par value common stock. If the participant
so requests, the Plan Administrator will sell all or a portion of such whole
shares of the Corporation's Common Stocks and remit the proceeds, less any
related brokerage commissions, a $5.00 service charge for each class of the
Corporation's Common Stocks sold, any applicable transfer taxes and any other
related costs of the sale. Any such sale of whole shares of the Corporation's
Common Stocks will be made by the Plan Administrator as promptly as possible
after processing the request for withdrawal, but no later than five business
days after receipt of such withdrawal request. The cash payment for any whole
or fractional shares of the Corporation's Common Stocks will be based on the
market price at which the Corporation's Common Stocks were sold by the Plan
Administrator less any related brokerage commissions, a $5.00 service charge
for each class of the Corporation's Common Stocks sold, any applicable
transfer taxes and any other related costs of the sale. Federal backup
withholding of 3l% may apply to any such cash payment from the Plan (see
Question 36). The Plan Administrator cannot accept any kind of limit order
to sell shares.
If such withdrawal request is received by the Plan Administrator on or
after the record date for a dividend payment, the Plan Administrator, in its
sole discretion, may either pay any such dividend in cash or reinvest it in
$1 2/3 par value common stock on behalf of the withdrawing participant. Any
optional cash investments sent to the Plan Administrator prior to the request
for withdrawal will also be invested in $1 2/3 par value common stock unless
return of the amount is expressly stated by the participant in the written
request for withdrawal and such withdrawal request is received at least two
business days prior to the next Investment Date for optional cash investments.
The request for withdrawal will then be processed as promptly as possible
following such Investment Date. See Questions 9 and 14 for information
concerning dividend record and payment dates and the Investment Dates for
optional cash investments. A withdrawal request received after a record date
may not be processed until after the investment is complete.
After a participant ceases to participate in the Plan, all subsequent
dividends will be paid to the participant in cash unless the participant re-
enrolls in the Plan, which the participant may do at any time by submitting
a signed and completed Authorization Form to the Plan Administrator (see
Question 3).
Beneficial owners reinvesting dividends indirectly in the Plan through
brokers, banks or other nominees must contact their broker, bank or nominee
regarding withdrawal from the Plan.
- 21 -<PAGE>
SALE OF SHARES IN PLAN ACCOUNTS
35. HOW MAY A PARTICIPANT SELL SHARES OF THE CORPORATION'S COMMON STOCKS
HELD UNDER THE PLAN?
A participant may sell shares held by the Plan Administrator in one of
two ways. The participant may request that the Plan Administrator issue stock
certificates for any or all of the shares held for the participant under the
Plan and the participant may sell any or all of such shares through the
participant's own broker at the time the participant chooses (see Question 29
for obtaining stock certificates).
On the other hand, the participant may request that the Plan
Administrator sell any or all of the shares held for the participant under the
Plan (see Question 34). Shares the participant sells in this manner would be
aggregated with those of other participants selling at the same time and would
be sold by the Plan Administrator as soon as practicable after receipt of the
request (see Question 34). A participant's sales proceeds would then be
remitted to the participant by check, less a $5.00 service charge for each
class of General Motors Common Stock sold plus the participant's proportionate
share of the brokerage commissions incurred in effecting the sale, any
applicable transfer taxes and any other related costs of the sale. Federal
backup withholding of 3l% may apply to any such cash payments from the Plan
(see Question 36). The Plan Administrator cannot accept any kind of limit
order to sell shares.
TAXATION
36. WHAT ARE THE FEDERAL INCOME TAX CONSEQUENCES OF PARTICIPATION IN THE
PLAN?
(a) All participants are urged to consult their own tax advisors to
determine the particular tax consequences, including consequences under
applicable foreign, state and local tax laws, which may result from their
participation in the Plan and the subsequent disposal by them of shares of $1
2/3 par value common stock purchased pursuant to the Plan. The income tax
consequences for participants who do not reside in the United States will vary
from jurisdiction to jurisdiction. The reinvestment of cash dividends does
not relieve a participant of any income tax payable on such dividends.
In general, the Corporation believes that stockholders who participate
in the Plan will have the same Federal and state income tax consequences, with
respect to dividends payable to them, as any other similarly situated holder
of the Corporation's Common Stocks. A participant will be treated for Federal
income tax purposes as having received, on each dividend payment date, a
dividend equal to the full amount of the cash dividend payable with respect
to the participant's shares, even though that amount is not actually received
by the participant in cash but, instead, is applied to the purchase of
additional shares of $1 2/3 par value common stock for the participant's
account under the Plan. Each year a participant will receive from the Plan
Administrator all required Internal Revenue Service Federal income tax
statements which reflect the dividends paid on shares of the Corporation's
Common Stocks registered in the participant's name and the dividends paid on
the participant's credited shares of the Corporation's Common Stocks under the
Plan (see Question 28).
- 22 -<PAGE>
(b) The Internal Revenue Service has ruled that administration fees
paid by the Corporation on a participant's behalf are not subject to income
taxes. The Internal Revenue Service has also ruled that when the Plan
Administrator makes open market purchases of $1 2/3 par value common stock,
the pro-rata share of brokerage fees attributable to such purchases will be
included in the per-share price. The participant's tax basis for each share
purchased under the Plan is the per-share price. (See Question 17 for
determination of per-share price.)
(c) The dividend income received by a corporate stockholder generally
is eligible for a 70% dividends-received deduction if the shares are held for
more than 45 days. However, the allowance of the dividends-received deduction
is limited where the corporate stockholder incurs any debt which is directly
attributable to an investment in such stock. Participants who are corporate
stockholders are advised to consult their own tax advisors with respect to the
tax consequences of their participation in the Plan.
(d) A foreign stockholder who is a participant and whose dividends are
subject to United States income tax withholding will have the amount of the
tax to be withheld deducted from such dividends before reinvestment in
additional shares for such participant's Plan account. The statements
confirming purchases made for a foreign participant will indicate that tax has
been withheld. Foreign stockholders who are participants are advised to
consult their own tax advisor with respect to the tax consequences of their
participation in the Plan.
If backup withholding applies, 31% of any such dividends or payments is
currently required to be withheld. Exempt participants (including, among
others, all corporations and certain foreign individuals) are not subject to
backup withholding and reporting requirements. In order to qualify as exempt,
a foreign individual must submit a statement attesting to that individual's
exempt status.
(e) A participant will not realize any taxable income upon receipt of
a stock certificate for whole shares of $1 2/3 par value common stock acquired
through the Plan. However, gain or loss may be recognized by a participant
when whole shares of $1 2/3 par value common stock are sold, either by the
Plan Administrator pursuant to the participant's request or by the participant
after withdrawal of such shares from the Plan. The amount of such gain or
loss will be the difference between the amount a participant receives for such
shares and the participant's tax basis for such shares (generally the
purchase cost thereof). In addition, a participant who received a cash
payment for a fractional share credited to a participant's Plan account may
have a gain or loss recognized with respect to the disposition of the
fractional share. The Plan Administrator's statements of a participant's Plan
account should be retained by the participant to help determine the tax basis
of shares of $1 2/3 par value common stock acquired through the Plan.
- 23 -<PAGE>
OTHER INFORMATION
37. WHAT HAPPENS IF THE CORPORATION DECLARES A STOCK DIVIDEND, A STOCK SPLIT
OR ISSUES SUBSCRIPTION RIGHTS?
Shares of the Corporation's Common Stocks resulting from stock splits
or stock dividends with respect to shares of the Corporation's Common Stocks,
both whole and fractional held by the Plan Administrator for a Plan
participant, will be added to those Plan shares. Shares of the Corporation's
Common Stocks resulting from stock splits or stock dividends with respect to
shares of the Corporation's Common Stocks held outside the Plan will be mailed
directly to a registered owner and to the broker, bank or other nominee of a
beneficial owner. Participation in any rights offering will be based upon
both the shares of the Corporation's Common Stocks held by a participant
outside the Plan and whole shares held by a participant under the Plan.
38. HOW WILL SHARES OF THE CORPORATION'S COMMON STOCKS HELD IN A
PARTICIPANT'S PLAN ACCOUNT BE VOTED AT MEETINGS OF STOCKHOLDERS?
For each meeting of stockholders, a participant will receive proxy
material that will enable the participant to vote both the shares of the
Corporation's Common Stocks registered in the participant's name directly
and/or whole shares of the Corporation's Common Stocks credited to the
participant's Plan account. Shares of the Corporation's Common Stocks held
by the Plan Administrator under the Plan for a participant will be voted as
the participant directs in a proxy card provided for that purpose. Fractions
of a share, if any, will not be voted. Participants may also vote in person
at a meeting of stockholders.
39. MAY THE PLAN BE AMENDED, SUSPENDED, MODIFIED OR TERMINATED?
The Corporation reserves the right to interpret and regulate the Plan
as it deems desirable or necessary. Notwithstanding any other provisions of
the Plan, the Corporation reserves the right to amend, suspend, modify or
terminate the Plan at any time, including the period between a record date and
the related payment date. Notice of any such suspension, material
modification or termination will be sent to all participants. Upon
termination of the Plan, except in the circumstances described below, any
uninvested optional cash investments will be returned, stock certificates for
whole shares credited to each participant's Plan account will be issued and
a cash payment will be made for any fractional share credited to each such
account.
In the event that the Corporation terminates the Plan for the purpose
of establishing a successor dividend reinvestment plan, participants will be
automatically enrolled in such successor plan and shares credited to their
Plan accounts will be credited automatically to such other successor plan,
unless written notice to the contrary is received by the Plan Administrator
from a participant.
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40. WHAT ARE THE RESPONSIBILITIES OF THE CORPORATION AND THE PLAN
ADMINISTRATOR UNDER THE PLAN?
Neither the Corporation nor the Plan Administrator nor their respective
directors, officers or employees shall be liable in administering the Plan for
any act done in good faith, or for any good faith omission to act, including,
without limitation, any claims of liability: (1) arising out of failure to
terminate the participant's Plan account upon such participant's death prior
to receipt of notice in writing of such death; (2) with respect to the prices
at which shares of $1 2/3 par value common stock are purchased or any of the
shares of the Corporation's Common Stocks are sold for the participant's Plan
account and the times when such purchases or sales are made; and (3) for any
fluctuations in the market price after purchase of shares of $1 2/3 par value
common stock or sale of any of the Corporation's Common Stocks under the Plan.
Furthermore, if it appears to the Corporation that any participant is
using or contemplating the use of the optional cash investment provisions of
the Plan in a manner or with an effect that, in the sole judgment and
discretion of the Corporation, is not in the best interests of the Corporation
or its stockholders, then the Corporation may decline to issue all or any
portion of the shares of $1 2/3 par value common stock for which any optional
cash investment by or on behalf of such participant is tendered. Such
optional cash investment (or the portion thereof not to be invested in shares
of $1 2/3 par value common stock) will be returned by the Corporation as
promptly as practicable, without interest.
NEITHER THE CORPORATION NOR THE PLAN ADMINISTRATOR CAN ASSURE A PARTICIPANT
OF A PROFIT OR PROTECT A PARTICIPANT AGAINST A LOSS ON SHARES OF THE
CORPORATION'S COMMON STOCKS PURCHASED OR SOLD UNDER THE PLAN.
41. WHO BEARS THE RISK OF MARKET FLUCTUATIONS IN THE CORPORATION'S COMMON
STOCKS HELD IN THE PLAN?
A participant's investment in the Plan held in the participant's Plan
account is no different than investment in directly held shares of the
Corporation's Common Stocks in this regard. A participant bears the risk of
loss and the benefits of gain from market place changes with respect to all
of the participant's shares of the Corporation's Common Stocks contained in
the Plan (see Question 40).
Neither the Corporation nor the Plan Administrator can guarantee that
shares of $1 2/3 par value common stock purchased under the Plan will, at any
given time, be worth any particular price, whether the same as, greater than
or less than the purchase price paid therefor.
42. CAN THE CORPORATION OR THE PLAN ADMINISTRATOR TERMINATE A PARTICIPANT'S
PARTICIPATION IN THE PLAN?
The Corporation or the Plan Administrator may terminate any
participant's participation in the Plan at any time for any reason (see
Question 40). In addition, if a participant no longer owns shares outside the
Plan and if the participant's Plan shares are less than one whole share, the
Plan Administrator is authorized to terminate such participant's Plan account.
In any such event, the Plan Administrator will follow the procedures for
termination described in Question 34.
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43. HOW MAY A PARTICIPANT OBTAIN ANSWERS TO QUESTIONS REGARDING THE PLAN OR
THE PARTICIPANT'S PLAN ACCOUNT?
General questions regarding the Plan or a participant's Plan account
should be addressed to the Plan Administrator at the address and telephone
number specified in Question 3.
44. HOW MAY A PARTICIPANT OBTAIN ANSWERS TO QUESTIONS CONCERNING OBTAINING
WAIVERS ON MAXIMUM PURCHASE LIMITATIONS?
A participant may call the Plan Administrator at 1-800-331-9922 in order
to obtain permission to invest amounts in excess of the maximum monthly
purchase limitations for both reinvesting dividends and making optional cash
investments (see Questions 20 and 23).
45. WHAT ARE SOME OF THE RESPONSIBILITIES OF A PARTICIPANT UNDER THE PLAN?
Shares of the Corporation's Common Stocks in the Plan are subject to
escheat to the state in which a participant resides in the event that such
shares are deemed, under such state's laws, to have been abandoned by a
participant.
A participant, therefore, should notify the Plan Administrator promptly
in writing of any change of address. Account statements and other
communications to a participant will be addressed to such participant at the
last address of record provided by such participant to the Plan Administrator.
A participant will have no right to instruct the Plan Administrator with
respect to any shares of the Corporation's Common Stocks or cash held by the
Plan Administrator except as expressly provided herein.
46. WHO MAY INTERPRET QUESTIONS ARISING UNDER THE PLAN?
Any question of interpretation arising under the Plan will be determined
by the Corporation and any such determination will be final. The Corporation
and/or the Plan Administrator may adopt rules and regulations to facilitate
the administration of the Plan. The terms and conditions of the Plan and its
operation shall be governed by the laws of the State of New York.
THE PLAN DOES NOT REPRESENT A CHANGE IN THE DIVIDEND POLICIES OF THE
CORPORATION, WHICH WILL CONTINUE TO DEPEND ON EARNINGS, FINANCIAL
REQUIREMENTS AND OTHER FACTORS. STOCKHOLDERS WHO DO NOT WISH TO PARTICIPATE
IN THE PLAN WILL CONTINUE TO RECEIVE CASH DIVIDENDS, SO DECLARED, IN THE
USUAL MANNER.
LEGAL OPINION
The legality of the $1 2/3 par value common stock offered hereby has
been passed upon by Martin I. Darvick, Attorney, Legal Staff of General
Motors. Mr. Darvick owns shares, and has options to purchase shares, of
$1 2/3 par value common stock.
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EXPERTS
The consolidated financial statements and the financial statement
schedule included in the 1994 Form 10-K, incorporated by reference herein,
have been audited by Deloitte & Touche LLP (as to financial statements and the
financial statement schedule of General Motors and as to financial statements
of Hughes Electronics Corporation) and KPMG Peat Marwick LLP (as to financial
statements of Electronic Data Systems Corporation), independent auditors, as
stated in their respective reports appearing therein, and have been so
incorporated by reference herein in reliance upon such reports given upon the
authority of such firms as experts in accounting and auditing.
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