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Filed Pursuant to Rule 424(b)(3)
File No. 033-00001
MCDirect Shares Prospectus
We are pleased to offer MCDirect Shares, a direct stock purchase plan which
provides investors with a convenient way to begin and build their McDonald's
shareownership and reinvest dividends.
. If you are not a shareholder, you may enroll either by investing at least
$1,000 or by authorizing automatic monthly investments of at least $100.
. If you hold at least 25 shares of McDonald's stock ($.01 par value) in
your name, you may enroll.
. If you hold less than 25 shares in your name, you may enroll either by
investing at least $1,000 or by authorizing automatic monthly investments
of at least $100.
. If you are a McDonald's System member, you may join the Plan and invest in
McDonald's stock by authorizing payroll deduction contributions to the Plan
of at least $20, if offered by your employer.
. Under the Plan, your cash dividends will automatically be reinvested in
additional shares of McDonald's stock.
. Once enrolled, you may make additional investments of $100 or more.
. If you are a shareholder, you may deposit your McDonald's stock
certificates with our Plan Administrator, First Chicago Trust Division of
EquiServe, for safekeeping, whether or not you participate in the Plan.
. You may establish either a traditional or Roth Individual Retirement
Account which invests in McDonald's stock through the Plan.
. You will be required to pay fees in connection with the Plan. These fees
are described in this prospectus.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved the McDonald's stock or determined if
this prospectus is accurate or complete. Any representation to the contrary is a
criminal offense.
The date of this prospectus is June 1, 1999.
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Table of Contents
5 McDonald's Corporation
5 MCDirect Shares
10 U.S. Federal Income Taxation
10 Where To Get More Information
11 Use of Proceeds
11 Plan of Distribution
11 Legal Matters
11 Experts
11 Inquiries
McDonald's Corporation
McDonald's Corporation and its subsidiaries develop, operate, franchise and
service a worldwide system of restaurants which prepare, assemble, package and
sell a limited menu of value-priced foods. These restaurants are operated by
McDonald's and its subsidiaries or, under the terms of franchise agreements, by
franchisees who are independent third parties, or by affiliates operating under
joint-venture agreements between McDonald's or its subsidiaries and local
business people. Uniform standards for quality of product, cleanliness and
efficiency, speed and service have been established. The McDonald's System
includes McDonald's franchisees and suppliers, their employees and employee
benefit plans, as well as employees of McDonald's, its subsidiaries and
affiliates. The McDonald's System operates more than 25,000 restaurants
worldwide which are located in more than 110 countries. Our principal executive
offices are located at One McDonald's Plaza, Oak Brook, IL 60523, telephone:
1-630-623-3000.
McDirect Shares
Purpose
McDirect Shares is a direct stock purchase plan which provides investors with a
convenient way to begin and build their McDonald's shareownership and reinvest
dividends.
Administration
First Chicago Trust Division of EquiServe administers the Plan. The Plan
Administrator purchases and holds shares purchased under the Plan, maintains
records, sends statements of account to participants, and performs other duties
related to the Plan.
Eligibility and Enrollment
You are eligible to participate in the Plan if you meet the requirements
described below. Regulations in certain countries may limit or prohibit
participation in this type of plan. Therefore, if you live outside the U.S., you
should first determine whether you are subject to any governmental regulations
prohibiting your participation. You will be charged fees for participating in
the Plan, including a $5.00 enrollment fee, a $3.00 annual account fee, certain
investment and trading fees and, if applicable, a $35.00 annual IRA fee. The
enrollment fee, the investment fee and the trading fee will be deducted from
your initial investment. See "Service Fees" on page 8.
Shareholders
If you hold at least 25 shares of McDonald's stock in your name, you can join
the Plan by mailing a completed enrollment form to the Plan Administrator. If
you hold less than 25 shares in your name, you may enroll either by investing at
least $1,000 or by authorizing automatic monthly investments of at least $100.
See "Methods of Investment-Automatic Investment" on page 6.
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Non-shareholders
If you do not currently own McDonald's stock, you can join the Plan by making an
initial investment of at least $1,000 or authorizing automatic monthly
investments of at least $100 per month. You can get started by returning a
completed enrollment form to the Plan Administrator.
McDonald's System Members
If you are a McDonald's System member, you may also join the Plan by returning a
completed enrollment form to the Plan Administrator and authorizing payroll
deduction contributions to the Plan of at least $20 per investment, if offered
by your employer. See "Methods of Investment--Payroll Deductions" below.
"Street Name" Holders
If your shares are held by a bank, broker, or trustee, you should direct your
bank, broker or trustee to register at least 25 shares of McDonald's stock
directly in your name and deliver a certificate to you. You can then get started
by returning a completed enrollment form to the Plan Administrator.
IRAs
You can establish either a traditional or Roth IRA which invests in McDonald's
stock through the Plan by making an initial investment to the IRA of at least
$1,000 or by transferring at least 25 shares of McDonald's stock or $1,000 or
more from an existing IRA. You can get started by returning an IRA Enrollment
Form and an IRA Funds Transfer Form to the Plan Administrator. These forms and a
disclosure statement are available from the Plan Administrator.
Methods of Investment
Investments cannot exceed $250,000 per calendar year and must be made in U.S.
dollars. For the purpose of applying this limit, all investments during any
calendar year (including initial and ongoing investments, but excluding dividend
reinvestments and share deposits) are aggregated. The Plan Administrator will
arrange for the purchase of shares for your account, but will not pay interest
on amounts pending investment.
Check Investment
Once enrolled, you may invest through the Plan by mailing a check or money order
for at least $100, payable to First Chicago Trust Division of EquiServe. Please
mail the completed transaction form located on your account statement or
transaction advice, along with your investment to the address specified in the
form. Any individual or entity (including McDonald's, its subsidiaries and
affiliates) may make additional cash investments for any participant or eligible
investor as a gift, award or as an incentive for future performance.
Automatic Investment
If you wish to make regular monthly optional cash investments, you can authorize
an automatic monthly withdrawal of at least $100 from your U.S. bank account. To
get started, you must complete and return the automatic investment section of
the enrollment form. Funds will be deducted from your account on the 15th of
each month or the last day of each month (whichever date you choose), or if the
date falls on a bank holiday, the next business day. Please allow up to four
weeks for the first automatic investment to begin.
To change or terminate automatic investments, you must notify the Plan
Administrator in writing at least six business days before the next automatic
investment date.
Payroll Deductions
If you are a McDonald's System member, you may authorize payroll deduction
contributions to the Plan of at least $20 per investment, if offered by your
employer. You should contact your personnel department or human resources
representative to determine if payroll deductions are available to you and what
the procedures are for initiating, changing and terminating payroll deductions.
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Dividends
By participating in the Plan, your cash dividends on shares, including
fractional shares, held in the Plan will be automatically reinvested (net of
the $3.00 account fee) in additional shares of McDonald's stock.
Transfer of Shares from Street Name
If your shares are held by a bank, a broker, a trustee or other agent, you may
transfer these shares to a Plan account by directing your agent to register
these shares directly in your name and deliver a certificate to you.
Purchases of McDonald's Stock
Plan shares will be purchased by the Plan Administrator either on the open
market or directly from McDonald's. Shares purchased on the open market may be
made on any stock exchange in the U.S. where McDonald's stock is traded, in the
over-the-counter market, or by negotiated transactions on terms the Plan
Administrator reasonably determines at the time of purchase. Any shares
purchased by the Plan Administrator from McDonald's will be made in accordance
with applicable requirements. Neither McDonald's nor any participant shall have
any authority or power to control the timing or pricing of shares purchased, or
the selection of the broker making the purchases. Therefore, you will not be
able to precisely time your purchases through the Plan and will bear the market
risk associated with fluctuations in the price of McDonald's stock. That is, if
you send in an initial or optional cash investment or authorize automatic
investments or payroll deductions, it is possible that the market price of
McDonald's stock could go up or down before the broker purchases stock with
your funds. In addition, you will not earn interest on investments for the
period before the shares are purchased. You will be charged fees to purchase
shares of McDonald's stock under the Plan. See "Service Fees" on page 8.
Purchases will be made weekly, but may be made daily when practicable. If
any such date is a day when the New York Stock Exchange is not open, purchases
will be made the next day. When McDonald's stock is purchased on the open
market, your price per share will be the weighted average purchase price of
shares purchased on that date. In the case of purchases from McDonald's, your
price per share will be the average of the high and low sales prices of
McDonald's stock as reported on the New York Stock Exchange Composite Tape on
that date.
Sales of McDonald's Stock
You can sell any number of whole shares in your Plan account or safekeeping
account by calling 1-800-Mc1-STCK or accessing your account on a secured website
at http://gateway.equiserve.com and providing the required account
identification and security information, or by completing and returning the
appropriate section of a transaction form to the Plan Administrator. The Plan
Administrator will sell those shares, along with shares to be sold for other
accounts, as promptly as practicable at 100% of the then current market price of
McDonald's stock and will send you a check or wire the sales proceeds, less any
sales and trading fees. See "Service Fees" on page 8.
You can choose to sell your shares through a stockbroker of your choice. In
that case, you must request a certificate for your shares from the Plan
Administrator.
Withdrawal from the Plan/Issuance of Certificates
You can withdraw some or all of your shares from your Plan account by properly
notifying the Plan Administrator. The Plan Administrator will transfer your
shares to a book-entry account maintained by the Plan Administrator, unless you
request a certificate.
Certificates will be issued for whole shares only. If your request involves
a fractional share, a check for the value of the fractional share (less
applicable fees) will be mailed to you. Please allow 3 to 5 days to process your
request.
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Certificates will be issued in the name(s) in which the account is
registered, unless otherwise instructed. In addition, checks will be payable to
the name(s) in which the account is registered, unless otherwise instructed. If
the certificate or check is to be issued in a name other than your Plan account
registration, the signature(s) on the instructions or stock power must be
guaranteed by a financial institution participating in the Medallion Guarantee
program.
Notices of withdrawal will be processed by the Plan Administrator and
uninvested funds will be returned to you as soon as practicable, without
interest. If your request to withdraw from the Plan is received on or after a
dividend record date but before the dividend payment date, your withdrawal will
be processed and a separate dividend check will be mailed to you within 5 days
after the dividend payment date. Future dividends will be paid in cash, unless
you rejoin the Plan.
Safekeeping of Your Stock Certificates
Shares of McDonald's stock that you buy under the Plan will be maintained in
your Plan account for safekeeping. You will receive a periodic statement
detailing the status of your holdings. McDonald's shareholders who do not
participate in the Plan may use the Plan's "safekeeping" service to deposit
their McDonald's stock certificates at no cost. Because McDonald's and the
Plan Administrator are responsible for the safekeeping of McDonald's stock
certificates deposited with the Plan, you no longer bear the risk and cost
associated with the loss, theft, or destruction of stock certificates so
deposited. Shareholders using this service who are not Plan participants will
receive dividends in cash until they enroll in the Plan. With safekeeping, you
can take advantage of the transfer and sale of shares features of the Plan.
Certificates will be issued upon request to the Plan Administrator. See
"Issuance of Certificates" on page 7.
To use the safekeeping service, send your certificates to the Plan
Administrator by registered mail with written instructions to deposit them in
safekeeping. Do not endorse the certificates or complete the assignment section.
Gift/Transfer of Shares
You can give or transfer McDonald's stock to anyone you choose. In order to
transfer some or all of your Plan shares or shares held in safekeeping, you must
send the Plan Administrator signed transfer instructions. Your signature must be
guaranteed by a financial institution participating in the Medallion Guarantee
program.
A new Plan account will not be opened unless you transfer at least 25
shares. If you are opening a new Plan account, you must send a completed
enrollment form and a $5.00 enrollment fee with your gift/transfer instructions.
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Service Fees
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Annual Account Fee (charged in quarterly installments of $.75) $ 3.00
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Enrollment Fee $ 5.00
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Investment Fees*
via check or wire $ 5.00
via automatic investment $ 1.00
via payroll deduction $ .25
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Sales Fee* $10.00
proceeds via wire add $25.00
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Fee for Bounced Checks or Rejected Automatic Investments $20.00
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Annual IRA Fee $35.00
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* Plus a $.10 per share trading fee, capped at $5.00 per trade.
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The Plan Administrator will deduct the applicable fees from proceeds due from a
sale, funds received for investment or the payment of dividends. The Plan
Administrator will charge applicable fees for IRA accounts. These fees are
described in the IRA disclosure statement. The annual IRA fee will be deducted
from your initial investment, unless paid separately. Future annual IRA fees
will be deducted from your Plan account by selling sufficient shares to cover
the fee, unless paid separately.
Because of the structure of the service fees, the cost of participation in
the Plan on a per share basis decreases as the number of shares held in your
Plan account increases. For this reason, you should carefully consider the
impact of the costs of participation in the Plan on your investment returns.
Communication
The Plan Administrator will establish and maintain a separate account under the
Plan for you. You will receive statements for account activity (except
reinvested dividends and payroll deductions) and periodic statements listing
your transactions.
Stock Splits; Stock Dividends; Other Distributions
In the event dividends are paid in McDonald's stock, or if McDonald's stock is
distributed in connection with any stock split or similar transaction, your
account will be adjusted accordingly.
Voting of Proxies
You will receive proxy materials, including a proxy for shares of McDonald's
stock held in your Plan account. The proxy will be voted as indicated by you. If
you do not return a proxy card or return it unsigned prior to the fifth day
before a shareholder meeting, the Plan Administrator will vote them in
accordance with the majority of Plan shares voted by participants.
Responsibility of the Plan Administrator and McDonald's
Neither McDonald's nor the Plan Administrator will be liable for any act they do
in good faith or for any good faith omission to act. This includes liability
for: the failure to terminate your account upon your death prior to receiving
written notice, or any purchases or sales prices reflected in your Plan account
or the dates of purchases or sales of your Plan shares or any fluctuation in the
market value after purchase or sale of shares.
Neither McDonald's nor the Plan Administrator can assure a profit or
protect you against a loss on the shares you purchased under the Plan. The
payment of dividends is at the discretion of the McDonald's Board of Directors
and will depend on future earnings, the financial condition of McDonald's and
other factors. The Board may change the amount and timing of dividends at any
time without notice.
Modification or Termination of the Plan
McDonald's may modify or terminate the Plan at any time and, in such event, you
will be so notified. No modification or termination will affect your previously
executed transactions. The Plan Administrator also reserves the right to change
any administrative procedures of the Plan.
Interpretation of the Plan
McDonald's may interpret and regulate the Plan as deemed necessary or desirable
in connection with the operation of the Plan and resolve questions or
ambiguities concerning the various provisions of the Plan.
Governing Law
The Plan is governed by and construed in accordance with the laws of the State
of Illinois.
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Change of Eligibility; Termination
The Plan Administrator will from time to time review your Plan account to
determine whether you continue to be eligible to participate in the Plan. If the
Plan Administrator determines that you are no longer eligible to participate, or
if the Plan is terminated, the Plan Administrator will notify you in writing.
The Plan Administrator will transfer all of your shares of McDonald's stock in
your Plan account to a book-entry account maintained by the Plan Administrator,
unless otherwise instructed. Please allow up to 30 days for this transfer. You
can request a certificate for your whole shares and a check for the value of any
fractional shares (based on the then current market price, less applicable
fees). You can also request a sale of your shares. See "Sales of McDonald's
Stock" on page 7. If your account consists of only a fractional share, the Plan
Administrator may close your account by notifying you in writing and sending a
check to you for the value of the fractional share based on the last sale price
for any whole shares sold.
U.S. Federal Income Taxation
Cash dividends reinvested under the Plan will be taxable as having been received
by you even though you have not received them in cash. You will receive an
annual statement from the Plan Administrator indicating the amount of reinvested
dividends reported to the U.S. Internal Revenue Service as dividend income.
You will not realize gain or loss for U.S. Federal income tax purposes upon
the transfer of shares to the Plan or the withdrawal of whole shares from the
Plan. You will, however, generally realize gain or loss upon the sale of shares
(including the receipt of cash for fractional shares) held in the Plan.
If you are a non-resident alien or non-U.S. corporation, partnership or
other entity generally you are subject to a withholding tax on dividends paid on
shares held in the Plan. The Plan Administrator is required to withhold from
dividends paid the amount determined in accordance with IRS regulations. Where
applicable, this withholding tax is determined by treaty between the U.S. and
your country. Accordingly, the amount of any dividends, net of the applicable
withholding tax, will be credited to your account for investment in additional
shares of McDonald's stock.
The above summary is not a comprehensive summary of all of the tax
considerations that may be relevant to your participation in the Plan. In
addition, special tax considerations may apply to certain participants, such as
those participating through an IRA. Therefore, you are urged to consult your tax
advisor regarding the consequences of participation in the Plan.
Where to Get More Information
McDonald's files annual, quarterly and current reports, proxy statements and
other information with the Securities and Exchange Commission. You may read and
copy any reports, statements or other information filed by McDonald's at the
SEC's public reference room in Washington, D.C. You can request copies of these
documents, upon payment of a duplicating fee, by writing to the SEC. Please call
the SEC at 1-800-SEC-0330 for further information on the operation of the public
reference room. SEC filings are also available to the public at the SEC's web
site at http://www.sec.gov.
The SEC allows McDonald's to "incorporate by reference" into this
prospectus information about McDonald's which is contained in the reports filed
with the SEC. The following documents filed with the SEC are incorporated into
this prospectus by reference and are considered a part of this prospectus:
(a) Our Annual Report on Form 10-K for the fiscal year ended December 31,
1998;
(b) Our Quarterly Report on Form 10-Q for the quarter ended March 31,
1999; and
(c) An amendment to the Registration Statement on Form 10 filed with the
SEC on April 23, 1991, which contains a description of McDonald's
stock, and any amendment or report which McDonald's files later to
update that description.
Later information that McDonald's files with the SEC will update this
information. McDonald's is also incorporating by reference all documents that
McDonald's files with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act of 1934, after the date of this prospectus.
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McDonald's will provide any of the above documents (including any exhibits
that are specifically incorporated by reference in them) to each person,
including any beneficial owner, to whom a prospectus is delivered. You may
request these documents at no cost. Written or telephone requests should be
directed to: McDonald's Shareholder Services, McDonald's Corporation, Kroc
Drive, Oak Brook, Illinois 60523, telephone: (630) 623-7428.
You should rely only on the information incorporated by reference or
provided in this prospectus or in any prospectus supplement. McDonald's has
authorized no one to provide you with different information. McDonald's is not
making an offer to sell stock in any state or country where the offer is not
permitted. You should not assume that the information in this prospectus or the
prospectus supplement is accurate as of any date other than the date of the
document.
Use of Proceeds
McDonald's will receive proceeds from the purchase of McDonald's stock under
the Plan only if purchases are made directly from McDonald's, and not from open
market purchases by the Plan Administrator. Proceeds received by McDonald's
from such purchases shall be used for general corporate purposes.
Plan of Distribution
McDonald's stock offered pursuant to the Plan will be purchased in the open
market or, at McDonald's option, directly from McDonald's. You will be charged
fees for participating in the Plan. See "Service Fees" on page 8 for a complete
description. All other costs related to the administration of the Plan will be
paid by McDonald's.
Legal Matters
Shelby Yastrow, a former Executive Vice President of McDonald's, has given his
opinion regarding the legality of the Common Stock covered by this prospectus.
Mr. Yastrow owns shares of McDonald's stock and he is eligible to participate
in the Plan.
Experts
The consolidated financial statements of the Company included in the Company's
Annual Report on Form 10-K for the year ended December 31, 1998, have been
audited by Ernst & Young LLP, independent auditors, as set forth in their report
thereon included therein, and incorporated herein this prospectus by reference.
Such consolidated financial statements are incorporated herein by reference in
reliance upon such report given on the authority of such firm as experts in
accounting and auditing.
Inquiries
For information about your account, you can call the Plan Administrator at
1-800-Mc1-STCK (U.S. and Canada) or 1-201-222-4990 (other countries call
collect) or 1-201-222-4945 (TDD# for hearing impaired). Send written
correspondence to McDonald's Shareholder Services, c/o First Chicago Trust
Division of EquiServe, P.O. Box 2591, Jersey City, New Jersey 07303-2591.
Please include a transaction form, found at the bottom of your account
statement, or a letter which includes your account number and refers to
McDirect Shares and a daytime telephone number.
