Filed pursuant to Rule 424b3
Registration No. 333-100527
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED NOVEMBER 21, 2002)
GENERAL ELECTRIC CAPITAL CORPORATION
$20,000,000,000
GE CAPITAL* INTERNOTES(R)
DUE FROM 9 MONTHS TO 60 YEARS FROM DATE OF ISSUE
We may offer to sell our GE Capital* InterNotes(R) from time to time. The
specific terms of the notes will be set prior to the time of sale and described
in a pricing supplement. You should read this prospectus supplement, the
accompanying prospectus and the applicable pricing supplement carefully before
you invest.
We may offer the notes to or through agents for resale. The amount we
expect to receive if all of the notes are sold to or through the agents is from
$19,960,000,000 to $19,400,000,000, after paying agent discounts and commissions
of between $40,000,000 and $600,000,000. We also may offer the notes directly.
We have not set a date for termination of our offering.
The agents have advised us that from time to time they may purchase and
sell notes in the secondary market, but they are not obligated to make a market
in the notes and may suspend or completely stop that activity without notice and
at any time. Unless otherwise specified in the applicable pricing supplement, we
do not intend to list the notes on any stock exchange.
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INVESTING IN THE NOTES INVOLVES CERTAIN RISKS, INCLUDING THOSE DESCRIBED
IN THE "RISK FACTORS" SECTION BEGINNING ON PAGE S-4.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these notes or passed on the adequacy
or accuracy of this prospectus supplement, the accompanying prospectus or any
pricing supplement. Any representation to the contrary is a criminal offense.
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JOINT LEAD MANAGERS AND LEAD AGENTS
BANC OF AMERICA SECURITIES LLC INCAPITAL LLC
AGENTS
A.G. EDWARDS CHARLES SCHWAB & CO., INC.
EDWARD D. JONES & CO., L.P. MERRILL LYNCH & CO.
MORGAN STANLEY PRUDENTIAL SECURITIES
SALOMON SMITH BARNEY UBS PAINEWEBBER
WACHOVIA SECURITIES
Prospectus Supplement dated November 22, 2002.
* GE Capital is a registered trademark of General Electric Company
InterNotes(R) is a registered servicemark of Incapital Holdings LLC
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
PAGE
----
Summary .................................................................. S-1
Risk Factors ............................................................. S-4
General Electric Capital Corporation ..................................... S-5
Description of Notes ..................................................... S-6
Registration and Settlement .............................................. S-12
United States Federal Income Tax Considerations .......................... S-15
Employee Retirement Income Security Act .................................. S-17
Plan of Distribution ..................................................... S-17
Legal Opinions ........................................................... S-18
PROSPECTUS
PAGE
----
Where You Can Get More Information on GECC ................................. 2
The Company ................................................................ 3
Use of Proceeds ............................................................ 3
Plan of Distribution ....................................................... 4
Securities Offered ......................................................... 5
Description of Debt Securities ............................................. 5
Description of Warrants .................................................... 9
Description of the Preferred Stock ......................................... 10
Description of Support Obligations and Interests Therein ................... 14
Legal Opinions ............................................................. 17
Experts .................................................................... 17
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS SUPPLEMENT, THE ACCOMPANYING PROSPECTUS AND ANY
PRICING SUPPLEMENT. WE HAVE NOT AUTHORIZED ANY OTHER PERSON TO PROVIDE YOU WITH
DIFFERENT OR ADDITIONAL INFORMATION. IF ANYONE PROVIDES YOU WITH DIFFERENT OR
ADDITIONAL INFORMATION, YOU SHOULD NOT RELY ON IT. WE ARE NOT MAKING AN OFFER TO
SELL THESE SECURITIES OR SOLICITING AN OFFER TO BUY THESE SECURITIES IN ANY
JURISDICTION WHERE THE OFFER OR SALE IS NOT PERMITTED. YOU SHOULD ASSUME THAT
THE INFORMATION APPEARING IN THIS PROSPECTUS SUPPLEMENT, THE ACCOMPANYING
PROSPECTUS AND ANY PRICING SUPPLEMENT, AS WELL AS INFORMATION FILED BY US WITH
THE SECURITIES AND EXCHANGE COMMISSION AND INCORPORATED BY REFERENCE IN THESE
DOCUMENTS, IS ACCURATE ONLY AS OF THEIR RESPECTIVE DATES. OUR BUSINESS,
FINANCIAL CONDITION, RESULTS OF OPERATIONS AND PROSPECTS MAY HAVE CHANGED SINCE
THEN.
UNLESS OTHERWISE INDICATED OR THE CONTEXT REQUIRE OTHERWISE, REFERENCES IN
THIS PROSPECTUS SUPPLEMENT TO "WE," "US," "OUR" AND "GECC" ARE TO GENERAL
ELECTRIC CAPITAL CORPORATION.
i
SUMMARY
THIS SECTION SUMMARIZES THE LEGAL AND FINANCIAL TERMS OF THE NOTES THAT ARE
DESCRIBED IN MORE DETAIL IN "DESCRIPTION OF NOTES" BEGINNING ON PAGE S-6. FINAL
TERMS OF ANY PARTICULAR NOTES WILL BE DETERMINED AT THE TIME OF SALE AND WILL BE
CONTAINED IN THE PRICING SUPPLEMENT RELATING TO THOSE NOTES. THE TERMS IN THAT
PRICING SUPPLEMENT MAY VARY FROM AND SUPERSEDE THE TERMS CONTAINED IN THIS
SUMMARY AND IN "DESCRIPTION OF NOTES." IN ADDITION, YOU SHOULD READ THE MORE
DETAILED INFORMATION APPEARING ELSEWHERE IN THIS PROSPECTUS SUPPLEMENT, THE
ACCOMPANYING PROSPECTUS AND IN THAT PRICING SUPPLEMENT.
Issuer ........................ General Electric Capital Corporation
Purchasing Agent .............. Incapital LLC
Joint Lead Managers and
Lead Agents ................... Banc of America Securities LLC and Incapital LLC
Agents ........................ A.G. Edwards & Sons, Inc.
Charles Schwab & Co., Inc.
Edward D. Jones & Co., L.P.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
Morgan Stanley & Co. Incorporated
Prudential Securities Incorporated
Salomon Smith Barney Inc.
UBS PaineWebber Inc.
Wachovia Securities, Inc.
Title of Notes ................ GE Capital* InterNotes(R)
Amount ........................ We may issue up to $20,000,000,000 of notes in
connection with this program. Additional notes
may be issued in the future without the consent
of note holders. The notes will not contain any
limitations on our ability to issue additional
indebtedness in the form of these notes or
otherwise.
Denominations ................. The notes will be issued and sold in
denominations of $1,000 and multiples of $1,000
(unless otherwise stated in the pricing
supplement).
Status ........................ The notes will be our direct unsecured senior
obligations and will rank equally with all of
our other unsecured senior indebtedness from
time to time outstanding.
Maturities .................... Each note will mature nine months or more from
its date of original issuance.
S-1
Interest ...................... Each note will bear interest from its date of
original issuance at a fixed rate per year.
Interest on each note will be payable either
monthly, quarterly, semiannually or annually on
each interest payment date and on the stated
maturity date. Interest also will be paid on the
date of redemption or repayment if a note is
redeemed or repurchased prior to its stated
maturity in accordance with its terms.
Interest on the notes will be computed on the
basis of a 360-day year of twelve 30-day months.
Principal ..................... The principal amount of each note will be
payable on its stated maturity date or upon
earlier redemption or repayment at the corporate
trust office of the paying agent or at any other
place we may designate.
Redemption and Repayment ...... Unless otherwise stated in the applicable
pricing supplement, a note will not be
redeemable at our option or be repayable at the
option of the holder prior to its stated
maturity date. The notes will not be subject to
any sinking fund.
Survivor's Option ............. Specific notes may contain a provision
permitting the optional repayment of those notes
prior to stated maturity, if requested by the
authorized representative of the beneficial
owner of those notes, following the death of the
beneficial owner of the notes, so long as the
notes were owned by the beneficial owner or his
or her estate at least six months prior to the
request. This feature is referred to as a
"Survivor's Option." Your notes will not be
repaid in this manner unless the pricing
supplement for your notes provides for the
Survivor's Option. The right to exercise the
Survivor's Option is subject to limits set by us
on (1) the permitted dollar amount of total
exercises by all holders of notes in any
calendar year, and (2) the permitted dollar
amount of an individual exercise by a holder of
a note in any calendar year. Additional details
on the Survivor's Option are described in the
section entitled "Description of
Notes--Survivor's Option" on page S-9.
S-2
Sale and Clearance ............ We will sell notes in the United States only.
Notes will be issued in book-entry only form and
will clear through The Depository Trust Company.
We do not intend to issue notes in certificated
form.
Trustee ....................... The trustee for the notes is JPMorgan Chase Bank
under an indenture dated as of February 27,
1997, as supplemented.
Selling Group ................. The agents and dealers comprising the selling
group are broker-dealers and securities firms.
The agents, including the Purchasing Agent,
have entered into a Selling Agent Agreement
with us dated November 22, 2002. Dealers who
are members of the selling group have executed
a Master Selected Dealer Agreement with the
Purchasing Agent. The agents and the dealers
have agreed to market and sell the notes in
accordance with the terms of those respective
agreements and all other applicable laws and
regulations. You may contact the Purchasing
Agent at info@incapital.com for a list of
selling group members.
S-3
RISK FACTORS
YOUR INVESTMENT IN THE NOTES WILL INVOLVE CERTAIN RISKS. THIS PROSPECTUS
SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS DO NOT DESCRIBE ALL OF THOSE RISKS.
IN ADDITION TO THE INFORMATION RELATING TO THE BUSINESSES OF GECC, WHICH IS
INCORPORATED BY REFERENCE IN THE ACCOMPANYING PROSPECTUS, YOU SHOULD, IN
CONSULTATION WITH YOUR OWN FINANCIAL AND LEGAL ADVISORS, CAREFULLY CONSIDER THE
FOLLOWING DISCUSSION OF RISKS BEFORE DECIDING WHETHER AN INVESTMENT IN THE NOTES
IS SUITABLE FOR YOU. THE NOTES WILL NOT BE AN APPROPRIATE INVESTMENT FOR YOU IF
YOU ARE NOT KNOWLEDGEABLE ABOUT SIGNIFICANT FEATURES OF THE NOTES OR FINANCIAL
MATTERS IN GENERAL. YOU SHOULD NOT PURCHASE THE NOTES UNLESS YOU UNDERSTAND, AND
KNOW THAT YOU CAN BEAR, THESE INVESTMENT RISKS.
THE MARKET VALUE OF THE NOTES MAY BE AFFECTED BY FACTORS IN ADDITION TO CREDIT
RATINGS.
The credit ratings assigned to the notes reflect the rating agencies'
opinion of our ability to make payments on the notes when such payments are due.
However, the ratings do not take into account fluctuations in the market value
of the notes as a result of changes in prevailing interest rates or other
factors.
WE MAY CHOOSE TO REDEEM NOTES WHEN PREVAILING INTEREST RATES ARE RELATIVELY LOW.
If your notes will be redeemable at our option, we may choose to redeem
your notes from time to time, especially when prevailing interest rates are
lower than the rate borne by the notes. If prevailing rates are lower at the
time of redemption, you would not be able to reinvest the redemption proceeds in
a comparable security at an effective interest rate as high as the interest rate
on the notes being redeemed. Our redemption right also may adversely impact your
ability to sell your notes as the optional redemption date or period approaches.
SURVIVOR'S OPTION MAY BE LIMITED IN AMOUNT.
We will have a discretionary right to limit the aggregate principal amount
of notes subject to the Survivor's Option that may be exercised in any calendar
year to an amount equal to the greater of $2,000,000 or 2% of the outstanding
principal amount of all the notes of this series outstanding as of the end of
the most recent calendar year. We also have the discretionary right to limit to
$250,000 in any calendar year the aggregate principal amount of notes subject to
the Survivor's Option that may be exercised in such calendar year on behalf of
any individual deceased beneficial owner of notes. Accordingly, no assurance can
be given that exercise of the Survivor's Option for the desired amount will be
permitted in any single calendar year.
WE CANNOT ASSURE THAT A TRADING MARKET FOR YOUR NOTES WILL EVER DEVELOP
OR BE MAINTAINED.
In evaluating the notes, you should assume that you will be holding the
notes until their stated maturity. The notes are a new issue of securities. We
cannot assure you that a trading market for your notes will ever develop, be
liquid or be maintained. Many factors independent of our creditworthiness affect
the trading market for and market value of your notes. Those factors include,
without limitation:
o the method of calculating the principal and interest for the notes;
o the time remaining to the stated maturity of the notes;
o the outstanding amount of the notes;
o the redemption or repayment features of the notes; and
o the level, direction and volatility of interest rates generally.
There may be a limited number of buyers when you decide to sell your notes.
This may affect the price you receive for your notes or your ability to sell
your notes at all.
S-4
GENERAL ELECTRIC CAPITAL CORPORATION
General Electric Capital Corporation was incorporated in 1943 in the State
of New York, under the provisions of the New York Banking Law relating to
investment companies, as successor to General Electric Contracts Corporation,
which was formed in 1932. Until November 1987, our name was General Electric
Credit Corporation. As of July 2001, General Electric Capital Corporation
completed its reincorporation as a Delaware corporation. All of our outstanding
common stock is owned by General Electric Capital Services, Inc. ("GE Capital
Services") formerly General Electric Financial Services, Inc., the common stock
of which is in turn wholly owned directly or indirectly by General Electric
Company ("GE Company"). Our business originally related principally to financing
the distribution and sale of consumer and other products of GE Company.
Currently, however, the types and brands of products we finance and the services
we offer are significantly more diversified. Very few of the products we finance
are manufactured by GE Company.
We operate in four separate financial services businesses: GE Commercial
Finance, GE Equipment Management, GE Consumer Finance and GE Insurance. Our
operations are subject to a variety of regulations in their respective
jurisdictions.
We offer our services primarily throughout the United States, Canada,
Europe and the Pacific Basin. Our principal executive offices are located at 260
Long Ridge Road, Stamford, Connecticut 06927 (telephone number (203) 357-4000).
At December 31, 2001, we employed approximately 88,000 persons.
S-5
DESCRIPTION OF NOTES
THE FOLLOWING DESCRIPTION OF THE PARTICULAR TERMS OF THE NOTES BEING
OFFERED SUPPLEMENTS AND, TO THE EXTENT INCONSISTENT WITH OR TO THE EXTENT
OTHERWISE SPECIFIED IN AN APPLICABLE PRICING SUPPLEMENT, REPLACES THE
DESCRIPTION OF THE GENERAL TERMS AND PROVISIONS OF THE DEBT SECURITIES SET FORTH
UNDER THE HEADINGS "DESCRIPTION OF DEBT SECURITIES" IN THE ACCOMPANYING
PROSPECTUS. UNLESS OTHERWISE SPECIFIED IN AN APPLICABLE PRICING SUPPLEMENT, THE
NOTES WILL HAVE THE TERMS DESCRIBED BELOW. CAPITALIZED TERMS USED BUT NOT
DEFINED BELOW HAVE THE MEANINGS GIVEN TO THEM IN THE ACCOMPANYING PROSPECTUS AND
IN THE INDENTURE RELATING TO THE NOTES.
The notes being offered by this prospectus supplement, the accompanying
prospectus and the applicable pricing supplement will be issued under an Amended
and Restated Indenture between us and JPMorgan Chase Bank (formerly known as The
Chase Manhattan Bank), as successor trustee (the "trustee"), dated as of
February 27, 1997, as supplemented by a First Supplemental Indenture dated as of
May 3, 1999, a Second Supplemental Indenture dated as of July 2, 2001 and a
Third Supplemental Indenture dated as of November 22, 2002 (collectively, the
"indenture"). The indenture is more fully described in the accompanying
prospectus. The indenture does not limit the aggregate amount of debt securities
that may be issued under it and provides that the debt securities may be issued
under it from time to time in one or more series. The following statements are
summaries of the material provisions of the indenture and the notes. These
summaries do not purport to be complete and are qualified in their entirety by
reference to the indenture, including for the definitions of certain terms. The
notes constitute a single series of debt securities for purposes of the
indenture and are limited to an aggregate principal amount of up to
$20,000,000,000. We may increase the foregoing limit, however, without the
consent of any holders of the notes, by appropriate corporate action if in the
future we wish to sell additional notes.
Notes issued in accordance with this prospectus supplement, the
accompanying prospectus and the applicable pricing supplement will have the
following general characteristics:
o the notes will be our direct unsecured senior obligations and will rank
equally with all of our other unsecured senior indebtedness from time to
time outstanding;
o the notes may be offered from time to time by us through the Purchasing
Agent and each note will mature on a day that is at least nine months
from its date of original issuance;
o each note will bear interest from its date of original issuance at a
fixed rate per year;
o the notes will not be subject to any sinking fund; and
o the minimum denomination of the notes will be $1,000 (unless otherwise
stated in the pricing supplement).
In addition, the pricing supplement relating to each offering of notes will
describe specific terms of the notes, including:
o the price, which may be expressed as a percentage of the aggregate
initial public offering price of the notes, at which the notes will be
issued to the public;
o the date on which the notes will be issued to the public;
o the stated maturity date of the notes;
o the rate per year at which the notes will bear interest;
o the interest payment frequency;
o the purchase price, Purchasing Agent's discount and net proceeds to us;
S-6
o whether the authorized representative of the holder of a beneficial
interest in the note will have the right to seek repayment upon the
death of the holder as described under "--Survivor's Option" on page
S-9;
o if the notes may be redeemed at our option or repaid at the option of
the holder prior to its stated maturity date, the provisions relating to
any such redemption or repayment; and
o any other significant terms of the notes not inconsistent with the
provisions of the indenture.
We may at any time purchase notes at any price or prices in the open market
or otherwise. Notes so purchased by us may, at our discretion, be held, resold
or surrendered to the trustee for cancellation.
PAYMENT OF PRINCIPAL AND INTEREST
Payment of principal of and interest on beneficial interests in the notes
will be made in accordance with the arrangements then in place between the
paying agent and The Depository Trust Company (referred to as "DTC") and its
participants as described under "Registration and Settlement--The Depository
Trust Company" on page S-12. Payments in respect of any notes in certificated
form will be made as described under "Registration and Settlement--Registration,
Transfer and Payment of Certificated Notes" on page S-14.
Interest on each note will be payable either monthly, quarterly,
semi-annually or annually on each interest payment date and at the note's stated
maturity or on the date of redemption or repayment if a note is redeemed or
repaid prior to maturity. Interest is payable to the person in whose name a note
is registered at the close of business on the regular record date before each
interest payment date. Interest due at a note's stated maturity or on a date of
redemption or repayment will be payable to the person to whom principal is
payable.
We will pay any administrative costs imposed by banks in connection with
making payments in immediately available funds, but any tax, assessment or
governmental charge imposed upon any payments on a note, including, without
limitation, any withholding tax, is the responsibility of the holders of
beneficial interests in the note in respect of which such payments are made.
INTEREST AND INTEREST RATES
Each note will accrue interest from its date of original issuance until its
stated maturity or earlier redemption or repayment. The applicable pricing
supplement will specify a fixed interest rate per year payable monthly,
quarterly, semi-annually or annually. Interest on the notes will be computed on
the basis of a 360-day year of twelve 30-day months. If the stated maturity
date, date of earlier redemption or repayment or interest payment date for any
note is not a business day, principal and interest for that note will be paid on
the next business day, and no interest will accrue on the amount payable from,
and after, the stated maturity date, date of earlier redemption or repayment or
interest payment date.
S-7
PAYMENT OF INTEREST
Interest on the notes will be paid as follows:
INTEREST PAYMENT FREQUENCY INTEREST PAYMENT DATES
Monthly ............................... Fifteenth day of each calendar month,
beginning in the first calendar month
following the month the note was issued.
Quarterly ............................. Fifteenth day of every third month,
beginning in the third calendar month
following the month the note was issued.
Semi-annually ......................... Fifteenth day of every sixth month,
beginning in the sixth calendar month
following the month the note was issued.
Annually .............................. Fifteenth day of every twelfth month,
beginning in the twelfth calendar month
following the month the note was issued.
The regular record date for any interest payment date will be the first day
of the calendar month in which the interest payment date occurs (whether or not
a business day), except that the regular record date for interest due on any
note's stated maturity date or date of earlier redemption or repayment will be
that particular date.
Interest on a note will generally be payable beginning on the first
interest payment date after its date of original issuance to holders of record
on the corresponding regular record date. However, if the date of original
issuance of a note is between a regular record date and the corresponding
interest payment date, the first interest payment will be made on the next
succeeding interest payment date.
"Business day" means any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which commercial banks are authorized or
required by law, regulation or executive order to close in The City of New York.
REDEMPTION AND REPAYMENT
Unless we otherwise provide in the applicable pricing supplement, a note
will not be redeemable or repayable prior to its stated maturity date.
If the pricing supplement states that the note will be redeemable at our
option prior to its stated maturity date, then on such date or dates specified
in the pricing supplement, we may redeem those notes at our option either in
whole or from time to time in part, upon not less than 30 nor more than 60 days'
written notice to the holder of those notes.
If the pricing supplement states that your note will be repayable at your
option prior to its stated maturity date, we will require receipt of notice of
the request for repayment at least 30 but not more than 60 days prior to the
date or dates specified in the pricing supplement. We also must receive the
completed form entitled "Option to Elect Repayment." Exercise of the repayment
option by the holder of a note is irrevocable. In addition, we will not permit
you to exercise the repayment option except in principal amounts of $1,000 and
multiples of $1,000.
Since the notes will be represented by a global note, DTC or its nominee
will be treated as the holder of the notes; therefore DTC or its nominee will be
the only entity that receives notices of redemption of notes from us, in
S-8
the case of our redemption of notes, and will be the only entity that can
exercise the right to repayment of notes, in the case of optional repayment. See
"Registration and Settlement" on page S-12.
To ensure that DTC or its nominee will timely exercise a right to repayment
with respect to a particular beneficial interest in a note, the beneficial owner
of the interest in that note must instruct the broker or other direct or
indirect participant through which it holds the beneficial interest to notify
DTC or its nominee of its desire to exercise a right to repayment. Because
different firms have different cut-off times for accepting instructions from
their customers, each beneficial owner should consult the broker or other direct
or indirect participant through which it holds an interest in a note to
determine the cut-off time by which the instruction must be given for timely
notice to be delivered to DTC or its nominee. Conveyance of notices and other
communications by DTC or its nominee to participants, by participants to
indirect participants and by participants and indirect participants to
beneficial owners of the notes will be governed by agreements among them and any
applicable statutory or regulatory requirements.
The redemption or repayment of a note normally will occur on the interest
payment date or dates following receipt of a valid notice. Unless otherwise
specified in the pricing supplement, the redemption or repayment price will
equal 100% of the principal amount of the note plus unpaid interest accrued to
the date or dates of redemption or repayment.
We may at any time purchase notes at any price or prices in the open market
or otherwise. We may also purchase notes otherwise tendered for repayment by a
holder or tendered by a holder's duly authorized representative through exercise
of the Survivor's Option described below. If we purchase the notes in this
manner, we have the discretion to either hold, resell or surrender the notes to
the trustee for cancellation.
SURVIVOR'S OPTION
The "Survivor's Option" is a provision in a note pursuant to which we agree
to repay that note, if requested by the authorized representative of the
beneficial owner of that note, following the death of the beneficial owner of
the note, so long as the note was owned by that beneficial owner or the estate
of that beneficial owner at least six months prior to the request. The pricing
supplement relating to each offering of notes will state whether the Survivor's
Option applies to those notes.
If a note is entitled to a Survivor's Option, upon the valid exercise of
the Survivor's Option and the proper tender of that note for repayment, we will
repay that note, in whole or in part, at a price equal to 100% of the principal
amount of the deceased beneficial owner's interest in that note plus unpaid
interest accrued to the date of repayment.
To be valid, the Survivor's Option must be exercised by or on behalf of the
person who has authority to act on behalf of the deceased beneficial owner of
the note (including, without limitation, the personal representative or executor
of the deceased beneficial owner or the surviving joint owner with the deceased
beneficial owner) under the laws of the applicable jurisdiction.
The death of a person holding a beneficial ownership interest in a note as
a joint tenant or tenant by the entirety with another person, or as a tenant in
common with the deceased holder's spouse, will be deemed the death of a
beneficial owner of that note, and the entire principal amount of the note so
held will be subject to repayment by us upon request. However, the death of a
person holding a beneficial ownership interest in a note as tenant in common
with a person other than such deceased holder's spouse will be deemed the death
of a beneficial owner only with respect to such deceased person's interest in
the note.
S-9
The death of a person who, during his or her lifetime, was entitled to
substantially all of the beneficial ownership interests in a note will be deemed
the death of the beneficial owner of that note for purposes of the Survivor's
Option, regardless of whether that beneficial owner was the registered holder of
that note, if entitlement to those interests can be established to the
satisfaction of the trustee and us. A beneficial ownership interest will be
deemed to exist in typical cases of nominee ownership, ownership under the
Uniform Transfers to Minors Act or Uniform Gifts to Minors Act, community
property or other joint ownership arrangements between a husband and wife. In
addition, a beneficial ownership interest will be deemed to exist in custodial
and trust arrangements where one person has all of the beneficial ownership
interests in the applicable note during his or her lifetime.
We have the discretionary right to limit the aggregate principal amount of
notes as to which exercises of the Survivor's Option shall be accepted by us
from authorized representatives of all deceased beneficial owners in any
calendar year to an amount equal to the greater of $2,000,000 or 2% of the
principal amount of all of the notes of this series outstanding as of the end of
the most recent calendar year. We also have the discretionary right to limit to
$250,000 in any calendar year the aggregate principal amount of notes as to
which exercises of the Survivor's Option shall be accepted by us from the
authorized representative of any individual deceased beneficial owner of notes
in such calendar year. In addition, we will not permit the exercise of the
Survivor's Option except in principal amounts of $1,000 and multiples of $1,000.
An otherwise valid election to exercise the Survivor's Option may not be
withdrawn. Each election to exercise the Survivor's Option will be accepted in
the order that elections are received by the trustee, except for any note the
acceptance of which would contravene any of the limitations described in the
preceding paragraph. Notes accepted for repayment through the exercise of the
Survivor's Option normally will be repaid on the first interest payment date
that occurs 20 or more calendar days after the date of the acceptance. Each
tendered note that is not accepted in any calendar year due to the application
of any of the limitations described in the preceding paragraph will be deemed to
be tendered in the following calendar year in the order in which all such notes
were originally tendered. If a note tendered through a valid exercise of the
Survivor's Option is not accepted, the trustee will deliver a notice by
first-class mail to the authorized representative of the deceased beneficial
owner that states the reason that note has not been accepted for repayment.
With respect to notes represented by a global note, DTC or its nominee is
treated as the holder of the notes and will be the only entity that can exercise
the Survivor's Option for such notes. To obtain repayment pursuant to exercise
of the Survivor's Option for a note, the deceased beneficial owner's authorized
representative must provide the following items to the broker or other entity
through which the beneficial interest in the note is held by the deceased
beneficial owner:
o a written instruction to such broker or other entity to notify DTC of
the authorized representative's desire to obtain repayment pursuant to
exercise of the Survivor's Option;
o appropriate evidence satisfactory to the trustee and us (a) that the
deceased was the beneficial owner of the note at the time of death and
his or her interest in the note was owned by the deceased beneficial
owner or his or her estate at least six months prior to the request for
repayment, (b) that the death of the beneficial owner has occurred, (c)
of the date of death of the beneficial owner, and (d) that the
representative has authority to act on behalf of the beneficial owner;
o if the interest in the note is held by a nominee of the deceased
beneficial owner, a certificate or letter satisfactory to the trustee
and us from the nominee attesting to the deceased's beneficial ownership
of such note;
o a written request for repayment signed by the authorized representative
of the deceased beneficial owner with the signature guaranteed by a
member firm of a registered national securities exchange or of the
S-10
National Association of Securities Dealers, Inc. or a commercial bank or
trust company having an office or correspondent in the United States;
o if applicable, a properly executed assignment or endorsement;
o tax waivers and any other instruments or documents that the trustee and
we reasonably require in order to establish the validity of the
beneficial ownership of the note and the claimant's entitlement to
payment; and
o any additional information the trustee or we reasonably require to
evidence satisfaction of any conditions to the exercise of the
Survivor's Option or to document beneficial ownership or authority to
make the election and to cause the repayment of the note.
In turn, the broker or other entity will deliver each of these items to the
trustee, together with evidence satisfactory to the trustee from the broker or
other entity stating that it represents the deceased beneficial owner.
We retain the right to limit the aggregate principal amount of notes as to
which exercises of the Survivor's Option applicable to the notes will be
accepted in any one calendar year as described above. All other questions
regarding the eligibility or validity of any exercise of the Survivor's Option
will be determined by us, in our sole discretion, which determination will be
final and binding on all parties.
The broker or other entity will be responsible for disbursing payments
received from the trustee to the authorized representative. See "Registration
and Settlement" on page S-12.
If applicable, we will comply with the requirements of Section 14(e) of the
Securities Exchange Act of 1934, and the rules promulgated thereunder, and any
other securities laws or regulations in connection with any repayment of notes
at the option of the registered holders or beneficial owners thereof.
S-11
REGISTRATION AND SETTLEMENT
THE DEPOSITORY TRUST COMPANY
All of the notes we offer will be issued in book-entry only form. This
means that we will not issue certificates for notes, except in the limited case
described below. Instead, we will issue global notes in registered form. Each
global note will be held through DTC and will be registered in the name of Cede
& Co., as nominee of DTC. Accordingly, Cede & Co. will be the holder of record
of the notes. Each note represented by a global note evidences a beneficial
interest in that global note.
Beneficial interests in a global note will be shown on, and transfers are
effected through, records maintained by DTC or its participants. In order to own
a beneficial interest in a note, you must be an institution that has an account
with DTC or have a direct or indirect account with such an institution.
Transfers of ownership interests in the notes will be accomplished by making
entries in DTC participants' books acting on behalf of beneficial owners.
So long as DTC or its nominee is the registered holder of a global note,
DTC or its nominee, as the case may be, will be the sole holder and owner of the
notes represented thereby for all purposes, including payment of principal and
interest, under the indenture. Except as otherwise provided below, you will not
be entitled to receive physical delivery of certificated notes and will not be
considered the holder of the notes for any purpose under the indenture.
Accordingly, you must rely on the procedures of DTC and the procedures of the
DTC participant through which you own your note in order to exercise any rights
of a holder of a note under the indenture. The laws of some jurisdictions
require that certain purchasers of notes take physical delivery of such notes in
certificated form. Those limits and laws may impair the ability to transfer
beneficial interests in the notes.
Each global note representing notes will be exchangeable for certificated
notes of like tenor and terms and of differing authorized denominations in a
like aggregate principal amount, only if (1) DTC notifies us that it is
unwilling or unable to continue as depositary for the global notes or we become
aware that DTC has ceased to be a clearing agency registered under the
Securities Exchange Act of 1934 and, in any such case we fail to appoint a
successor to DTC within 90 calendar days or (2) we, in our sole discretion,
determine that the global notes shall be exchangeable for certificated notes.
Upon any such exchange, the certificated notes shall be registered in the names
of the beneficial owners of the global note representing the notes.
The following is based on information furnished by DTC:
DTC will act as securities depositary for the notes. The notes will be
issued as fully-registered notes registered in the name of Cede & Co. (DTC's
partnership nominee) or such other name as may be requested by an authorized
representative of DTC. Generally, one fully registered global note will be
issued for all of the principal amount of the notes. If, however, the aggregate
principal amount of the notes exceeds $500 million, one certificate will be
issued with respect to each $500 million of principal amount, and an additional
certificate will be issued with respect to any remaining principal amount of
such note.
DTC, the world's largest depositary, is a limited-purpose trust company
organized under the New York Banking Law, a "banking organization" within the
meaning of the New York Banking Law, a member of the Federal Reserve System, a
"clearing corporation" within the meaning of the New York Uniform Commercial
Code, and a "clearing agency" registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934. DTC holds and provides asset
servicing for over 2 million issues of U.S. and non-U.S. equity issues,
corporate and municipal debt issues and money market instruments from over 85
countries that DTC's direct participants deposit with DTC.
DTC also facilitates the post-trade settlement among direct participants of
sales and other securities transactions in deposited securities, through
electronic computerized book-entry transfers and pledges between
S-12
direct participants' accounts. This eliminates the need for physical movement of
securities certificates. Direct participants include both U.S. and non U.S.
securities brokers and dealers, banks, trust companies, clearing corporations,
and certain other organizations. DTC is a wholly-owned subsidiary of The
Depository Trust & Clearing Corporation ("DTCC"). DTCC, in turn, is owned by a
number of direct participants of DTC and members of the National Securities
Clearing Corporation, Government Securities Clearing Corporation, MBS Clearing
Corporation, and Emerging Markets Clearing Corporation, as well as by The New
York Stock Exchange, Inc., the American Stock Exchange LLC, and the National
Association of Securities Dealers, Inc. Access to the DTC system is also
available to others such as both U.S. and non-U.S. securities brokers and
dealers, banks, trust companies and clearing corporations that clear through or
maintain a custodial relationship with a direct participant, either directly or
indirectly. DTC has Standard & Poor's highest rating: AAA. The DTC rules
applicable to its participants are on file with the SEC. More information about
DTC can be found at www.dtcc.com.
Purchases of the notes under the DTC system must be made by or through
direct participants, which will receive a credit for the notes on DTC's records.
The beneficial interest of each actual purchaser of each note is in turn to be
recorded on the direct and indirect participants' records. Beneficial owners
will not receive written confirmation from DTC of their purchase. Beneficial
owners are, however, expected to receive written confirmations providing details
of the transaction, as well as periodic statements of their holdings, from the
direct or indirect participant through which the beneficial owner entered into
the transaction. Transfers of beneficial interests in the notes are to be
accomplished by entries made on the books of direct and indirect participants
acting on behalf of beneficial owners. Beneficial owners will not receive
certificates representing their beneficial interests in notes, except in the
event that use of the book-entry system for the notes is discontinued.
To facilitate subsequent transfers, all notes deposited by direct
participants with DTC will be registered in the name of DTC's partnership
nominee, Cede & Co. or such other name as may be requested by an authorized
representative of DTC. The deposit of the notes with DTC and their registration
in the name of Cede & Co. or such other nominee do not effect any change in
beneficial ownership. DTC has no knowledge of the actual beneficial owners of
the notes; DTC's records reflect only the identity of the direct participants to
whose accounts such notes will be credited, which may or may not be the
beneficial owners. The direct and indirect participants will remain responsible
for keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to direct
participants, by direct participants to indirect participants, and by direct
participants and indirect participants to beneficial owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time. Beneficial owners of the notes may wish to
take certain steps to augment the transmission to them of notices of significant
events with respect to the notes, such as redemption, tenders, defaults, and
proposed amendments to the security documents. For example, beneficial owners of
the notes may wish to ascertain that the nominee holding the notes for their
benefit has agreed to obtain and transmit notices to beneficial owners. In the
alternative, beneficial owners may wish to provide their names and addresses to
the registrar of the notes and request that copies of the notices be provided to
them directly. Any such request may or may not be successful.
Neither DTC nor Cede & Co. (nor any other DTC nominee) will consent or vote
with respect to the notes unless authorized by a direct participant in
accordance with DTC's procedures. Under its usual procedures, DTC mails an
Omnibus Proxy to us as soon as possible after the regular record date. The
Omnibus Proxy assigns Cede & Co.'s consenting or voting rights to those direct
participants to whose accounts the notes are credited on the record date
(identified in a listing attached to the Omnibus Proxy).
We will pay principal and or interest payments on the notes in same-day
funds directly to Cede & Co., or such other nominee as may be requested by an
authorized representative of DTC. DTC's practice is to credit direct
participants' accounts on the applicable payment date in accordance with their
respective holdings shown on DTC's records upon DTC's receipt of funds and
corresponding detail information. Payments by participants to
S-13
beneficial owners will be governed by standing instructions and customary
practices, as is the case with securities held for the accounts of customers in
bearer form or registered in "street name," and will be the responsibility of
these participants and not of DTC or any other party, subject to any statutory
or regulatory requirements that may be in effect from time to time. Payment of
principal and interest to Cede & Co., or such other nominee as may be requested
by an authorized representative of DTC, is our responsibility, disbursement of
such payments to direct participants is the responsibility of DTC, and
disbursement of such payments to the beneficial owners is the responsibility of
the direct or indirect participant.
We will send any redemption notices to DTC. If less than all of the notes
are being redeemed, DTC's practice is to determine by lot the amount of the
interest of each direct participant in such issue to be redeemed.
A beneficial owner, or its authorized representative, shall give notice to
elect to have its notes repaid by us, through its direct or indirect
participant, to the trustee, and shall effect delivery of such notes by causing
the direct participant to transfer that participant's interest in the global
note representing such notes, on DTC's records, to the trustee. The requirement
for physical delivery of notes in connection with a demand for repayment will be
deemed satisfied when the ownership rights in the global note representing such
notes are transferred by the direct participants on DTC's records.
DTC may discontinue providing its services as securities depository for the
notes at any time by giving us reasonable notice. Under such circumstances, if a
successor securities depositary is not obtained, we will print and deliver
certificated notes. We may decide to discontinue use of the system of book-entry
transfers through DTC (or a successor securities depositary). In that event, we
will print and deliver certificated notes.
The information in this section concerning DTC and DTC's system has been
obtained from sources that we believe to be reliable, but neither we, the
Purchasing Agent nor any agent takes any responsibility for its accuracy.
REGISTRATION, TRANSFER AND PAYMENT OF CERTIFICATED NOTES
If we ever issue notes in certificated form, those notes may be presented
for registration, transfer and payment at the office of the registrar or at the
office of any transfer agent designated and maintained by us. We have initially
designated JPMorgan Chase Bank to act in those capacities for the notes. The
registrar or transfer agent will make the transfer or registration only if it is
satisfied with the documents of title and identity of the person making the
request. There will not be a service charge for any exchange or registration of
transfer of the notes, but we may require payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection with the
exchange. At any time, we may change transfer agents or approve a change in the
location through which any transfer agent acts. We also may designate additional
transfer agents for any notes at any time.
We will not be required to: (1) issue, register the transfer of or exchange
any note to be redeemed for a period of 15 calendar days preceding the first
publication of the relevant notice of redemption, or if registered notes are
outstanding and there is no publication, the mailing of the relevant notice of
redemption; (2) exchange or register the transfer of any note that was selected
for redemption, in whole or in part, except the unredeemed portion of any such
notes being redeemed in part; (3) exchange any unregistered notes selected for
redemption except that such unregistered notes may be exchanged for registered
notes of like tenor, provided that such registered notes shall be simultaneously
surrendered for redemption; or (4) register the transfer of or exchange any
notes surrendered for optional repayment, in whole or in part.
We will pay principal of and interest on any certificated notes at the
offices of the paying agents we may designate from time to time. Generally, we
will pay interest on a note by check on any interest payment date other than at
stated maturity or upon earlier redemption or repayment to the person in whose
name the note is registered at the close of business on the regular record date
for that payment. We will pay principal and interest at stated maturity or upon
earlier redemption or repayment in same-day funds against presentation and
surrender of the applicable notes.
S-14
UNITED STATES FEDERAL TAX CONSIDERATIONS
The following discussion summarizes certain U.S. federal income tax
considerations that may be relevant to you if you invest in notes. Except as
discussed under "Non-U.S. Holders" and "Information Reporting and Backup
Withholding", the discussion generally applies only to you if you are an
individual who is a citizen or resident of the United States that is a cash
basis taxpayer (a "U.S. holder"). This summary deals only with U.S. holders that
hold notes as capital assets and purchase notes as part of the initial
distribution at their issue price. It does not address considerations that may
be relevant to you if you are an investor that is subject to special tax rules,
such as a person that: (i) is not an individual; (ii) uses the accrual method of
tax accounting; (iii) elects mark to market treatment; (iv) holds notes as a
hedge or as a position in a "straddle," conversion or other integrated
transaction; (v) is a former citizen or resident; or (vi) has a "functional
currency" other than the U.S. dollar.
This summary is based on laws, regulations, rulings and decisions now in
effect, all of which may change. Any change could apply retroactively and could
affect the continued validity of this summary.
You should consult your tax adviser about the tax consequences of
purchasing or holding notes, including the relevance to your particular
situation of the considerations discussed below, as well as the relevance to
your particular situation of state, local or other tax laws.
PAYMENTS OF INTEREST
Payments of interest on a note will be taxable to you as ordinary interest
income at the time that you receive such amounts.
SALE AND RETIREMENT OF NOTES
When you sell or exchange a note, or if a note that you hold is retired,
you generally will recognize gain or loss equal to the difference between the
amount you realize on the transaction (less any accrued interest, which will be
taxable to you as ordinary interest income) and your tax basis in the note. Your
tax basis in a note generally will equal the cost of the note to you.
Except as discussed below with respect to short-term notes, the gain or
loss that you recognize on the sale, exchange or retirement of a note generally
will be capital gain or loss. The gain or loss on the sale, exchange or
retirement of a note will be long-term capital gain or loss if you have held the
note for more than one year on the date of disposition. Net long-term capital
gain recognized by you generally will be subject to tax at a lower rate than net
short-term capital gain or ordinary income. The ability of U.S. holders to
offset capital losses against ordinary income is limited.
SHORT-TERM NOTES
Special U.S. federal income tax rules will apply to notes with maturities
of one year or less ("short-term notes"). Those rules provide that payments on a
short term note give rise to "original issue discount" that generally is not
required to be included in income prior to the maturity or disposition of a
short-term note. Thus, if a short-term note provides for a single interest
payment at maturity, you will be required to include that payment as ordinary
income upon maturity of the note. In addition, you will be required to treat any
gain realized on a sale, exchange or retirement of a short-term note as ordinary
income to the extent such gain does not exceed the interest accrued during the
period you held the note. The treatment of interest payments received on a
short-term note prior to maturity is not entirely clear under these special
rules, however, and it is possible that you would be required to include such
payments as ordinary income at the time received rather than upon a subsequent
disposition of the note.
S-15
You may not be allowed to deduct all of the interest paid or accrued on any
indebtedness incurred or maintained to purchase or carry a short-term note until
the note matures or upon an earlier disposition in a taxable transaction.
However, you may elect to accrue interest in gross income on a current basis and
avoid the limitation on the deductibility of interest described above.
NON-U.S. HOLDERS
If you are a non-resident alien individual or a foreign corporation (a
"non-U.S. holder"), the interest income that you derive in respect of the notes
generally will be exempt from United States federal withholding tax. This
exemption will apply to you provided that
o you do not actually or constructively own 10 percent or more of the
combined voting power of all classes of our stock and you are not a
controlled foreign corporation that is related, directly or indirectly
to us through stock ownership, and
o the beneficial owner provides a statement (generally, an Internal
Revenue Service Form W-8BEN) signed under penalties of perjury that
includes its name and address and certifies that it is a non-U.S. person
in compliance with applicable requirements (or satisfies certain
documentary evidence requirements for establishing that it is a non-U.S.
person).
If you are a non-U.S. holder, any gain you realize on a sale, exchange or
other disposition of notes generally will be exempt from United States federal
income tax, including withholding tax. This exemption will not apply to you if
your gain is effectively connected with your conduct of a trade or business in
the United States or you are an individual holder and are present in the United
States for 183 days or more in the taxable year of the disposition and either
your gain is attributable to an office or other fixed place of business that you
maintain in the United States or you have a tax home in the United States.
U.S. federal estate tax will not apply to a note held by you if at the time
of death you were not a citizen or resident of the United States, you did not
actually or constructively own 10 percent or more of the combined voting power
of all classes of our stock and payments of interest on the note would not have
been effectively connected with the conduct by you of a trade or business in the
United States.
For purposes of applying the rules set forth under this heading "Non-U.S.
Holders" to a note held by an entity that is treated as fiscally transparent
(for example, a partnership) for U.S. federal income tax purposes, the
beneficial owner means each of the ultimate beneficial owners of the entity.
INFORMATION REPORTING AND BACKUP WITHHOLDING
The paying agent must file information returns with the Internal Revenue
Service in connection with payments made on the notes to certain U.S. holders.
If you are a U.S. holder, you generally will not be subject to United States
backup withholding tax on such payments if you provide your taxpayer
identification number to the paying agent. You may also be subject to
information reporting and backup withholding tax requirements with respect to
the proceeds from a sale of the notes. If you are a non-U.S. holder, you may
have to comply with certification procedures to establish your non-U.S. status
in order to avoid information reporting and backup withholding tax requirements.
The certification procedures required to claim the exemption from withholding
tax on interest income described above will satisfy these requirements. The
amount of any backup withholding from a payment to a holder may be allowed as a
credit against the holder's U.S. federal income tax liability and may entitle
the holder to a refund, provided that the required information is furnished to
the Internal Revenue Service.
S-16
EMPLOYEE RETIREMENT INCOME SECURITY ACT
A fiduciary of a pension plan or other employee benefit plan (including a
governmental plan, an individual retirement account or a Keogh plan) proposing
to invest in the notes should consider this section carefully.
A fiduciary of an employee benefit plan subject to the Employee Retirement
Income Security Act of 1974, as amended (commonly referred to as "ERISA") should
consider fiduciary standards under ERISA in the context of the particular
circumstances of such plan before authorizing an investment in the notes. Such
fiduciary should consider whether the investment is in accordance with the
documents and instruments governing the plan.
In addition, ERISA and the Code prohibit certain transactions (referred to
as "prohibited transactions") involving the assets of a plan subject to ERISA or
the assets of an individual retirement account or plan subject to Section 4975
of the Code (referred to as an "ERISA plan"), on the one hand, and persons who
have certain specified relationships to the plan ("parties in interest" within
the meaning of ERISA or "disqualified persons" within the meaning of the Code),
on the other. If we (or an affiliate) are considered a party in interest or
disqualified person with respect to an ERISA plan, then the investment in notes
by the ERISA plan may give rise to a prohibited transaction.
By purchasing and holding the notes, the person making the decision to
invest on behalf of an ERISA plan is representing that the purchase and holding
of the notes will not result in a prohibited transaction under ERISA or the
Code. Therefore, an ERISA plan should not invest in the notes unless the plan
fiduciary or other person acquiring securities on behalf of the ERISA plan
determines that neither we nor an affiliate is a party in interest or a
disqualified person or, alternatively, that an exemption from the prohibited
transaction rules is available. If an ERISA plan engages in a prohibited
transaction, the transaction may require "correction" and may cause the ERISA
plan fiduciary to incur certain liabilities and the parties in interest or
disqualified persons to be subject to excise taxes.
If you are the fiduciary of a pension plan or other ERISA plan, or an
insurance company that is providing investment advice or other features to a
pension plan or other ERISA plan, and you propose to invest in the notes with
the assets of the ERISA plan, you should consult your own legal counsel for
further guidance.
PLAN OF DISTRIBUTION
Under the terms of a Selling Agent Agreement dated November 22, 2002, the
notes will be offered from time to time by us to the Purchasing Agent for
subsequent resale to the agents and other dealers who are broker-dealers and
securities firms. The agents, including the Purchasing Agent, are parties to the
Selling Agent Agreement. The notes will be offered for sale in the United States
only. Dealers who are members of the selling group have executed a Master
Selected Dealer Agreement with the Purchasing Agent. We also may appoint
additional agents to sell the notes. Any sale of the notes through those
additional agents, however, will be on the same terms and conditions to which
the original agents have agreed. The Purchasing Agent will purchase the notes at
a discount ranging from .2% to 3% of the non-discounted price for each note
sold. However, we also may sell the notes to the Purchasing Agent at a discount
greater than or less than the range specified above. The discount at which we
sell the notes to the Purchasing Agent will be set forth in the applicable
pricing supplement. The Purchasing Agent also may sell notes to dealers at a
concession not in excess of the discount it received from us. In certain cases,
the Purchasing Agent and the other agents and dealers may agree that the
Purchasing Agent will retain the entire discount. We will disclose any
particular arrangements in the applicable pricing supplement.
Following the solicitation of orders, each of the agents, severally and not
jointly, may purchase notes as principal for its own account from the Purchasing
Agent. Unless otherwise set forth in the applicable pricing
S-17
supplement, these notes will be purchased by the agents and resold by them to
one or more investors at a fixed public offering price. After the initial public
offering of notes, the public offering price (in the case of notes to be resold
at a fixed public offering price), discount and concession may be changed.
We have the sole right to accept offers to purchase notes and may reject
any proposed offer to purchase notes in whole or in part. Each agent also has
the right, in its discretion reasonably exercised, to reject any proposed offer
to purchase notes in whole or in part. We reserve the right to withdraw, cancel
or modify any offer without notice. We also may change the terms, including the
interest rate we will pay on the notes, at any time prior to our acceptance of
an offer to purchase.
Each agent, including the Purchasing Agent, may be deemed to be an
"underwriter" within the meaning of the Securities Act of 1933. We have agreed
to indemnify the agents against certain liabilities, including liabilities under
the Securities Act of 1933, or to contribute to any payments they may be
required to make in respect of such liabilities. We also have agreed to
reimburse the agents for certain expenses.
No note will have an established trading market when issued. We do not
intend to apply for the listing of the notes on any securities exchange.
However, we have been advised by the agents that they may purchase and sell
notes in the secondary market as permitted by applicable laws and regulations.
The agents are not obligated to make a market in the notes, and they may
discontinue making a market in the notes at any time without notice. Neither we
nor the agents can provide any assurance regarding the development, liquidity or
maintenance of any trading market for any notes. All secondary trading in the
notes will settle in same-day funds. See "Registration and Settlement" on page
S-12.
In connection with certain offerings of notes, the rules of the SEC permit
the Purchasing Agent to engage in transactions that may stabilize the price of
the notes. The Purchasing Agent will conduct these activities for the agents.
These transactions may consist of short sales, stabilizing transactions and
purchases to cover positions created by short sales. A short sale is the sale by
the Purchasing Agent of a greater amount of notes than the amount the Purchasing
Agent has agreed to purchase in connection with a specific offering of notes.
Stabilizing transactions consist of certain bids or purchases made by the
Purchasing Agent to prevent or retard a decline in the price of the notes while
an offering of notes is in process. In general, these purchases or bids for the
notes for the purpose of stabilization or to reduce a syndicate short position
could cause the price of the notes to be higher than it might otherwise be in
the absence of those purchases or bids. Neither we nor the Purchasing Agent
makes any representation or prediction as to the direction or magnitude of any
effect that these transactions may have on the price of any notes. In addition,
neither we nor the Purchasing Agent makes any representation that, once
commenced, these transactions will not be discontinued without notice. The
Purchasing Agent is not required to engage in these activities and may end any
of these activities at any time.
The agents or dealers to or through which we may sell notes may engage in
transactions with us and perform services for us in the ordinary course of
business.
LEGAL OPINIONS
Alan M. Green, our Associate General Counsel, Treasury Operations, will
issue an opinion about the legality of the notes for us. Davis Polk & Wardwell,
New York, New York will issue an opinion for the agents. Cleary, Gottlieb, Steen
& Hamilton, New York, New York will issue an opinion regarding the "United
States Tax Considerations" section of this prospectus supplement. Mr. Green
beneficially owns or has rights to acquire an aggregate of less than 0.01% of
General Electric Company's common stock.
S-18
PROSPECTUS
GENERAL ELECTRIC CAPITAL CORPORATION
DEBT SECURITIES
WARRANTS TO PURCHASE DEBT SECURITIES
PREFERRED STOCK
GUARANTEES, LETTERS OF CREDIT AND PROMISSORY NOTES OR LOAN
OBLIGATIONS, INCLUDING INTERESTS THEREIN
----------
General Electric Capital Corporationmay offer from time to time:
o senior, unsecured debt securities,
o warrants to purchase any of the debt securities,
o variable cumulative preferred stock, par value $100 per share, which may
be issued in the form of depositary shares evidenced by depositary
receipts,
o preferred stock, par value $.01 per share, which may be issued in the
form of depositary shares evidenced by depositary receipts and
o senior unsecured guarantees, direct-pay letters of credit and
indebtedness evidenced by promissory notes or loan obligations,
including in each case interests therein.
WE WILL PROVIDE SPECIFIC TERMS OF THESE SECURITIES IN SUPPLEMENTS TO THIS
PROSPECTUS. YOU SHOULD READ THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT
CAREFULLY BEFORE YOU INVEST.
----------
THESE SECURITIES HAVE NOT BEEN APPROVED BY THE SEC OR ANY STATE SECURITIES
COMMISSION, NOR HAVE THESE ORGANIZATIONS DETERMINED THAT THIS PROSPECTUS IS
ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
November 21, 2002
YOU SHOULD RELY ONLY ON THE INFORMATION INCORPORATED BY REFERENCE OR
PROVIDED IN THIS PROSPECTUS AND THE PROSPECTUS SUPPLEMENT. WE HAVE AUTHORIZED NO
ONE TO PROVIDE YOU WITH DIFFERENT INFORMATION. WE ARE NOT MAKING AN OFFER OF
THESE SECURITIES IN ANY STATE WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD NOT
ASSUME THAT THE INFORMATION IN THIS PROSPECTUS OR THE PROSPECTUS SUPPLEMENT IS
ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF THE DOCUMENT.
REFERENCES IN THIS PROSPECTUS TO "GECC", "WE", "US" AND "OUR" ARE TO
GENERAL ELECTRIC CAPITAL CORPORATION.
----------
WHERE YOU CAN GET MORE
INFORMATION ON GECC
GECC files annual, quarterly and current reports with the SEC. You may
obtain any document we file with the SEC at the SEC's Public Reference Room in
Washington, D.C. You may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0330. Our SEC filings are also
accessible through the Internet at the SEC's Web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" into this prospectus the
information in documents we file with it, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be a part of this
prospectus, and later information that we file with the SEC will update and
supersede this information. We incorporate by reference the documents listed
below and any future filings we make with the SEC under Section 13(a), 13(c),
14, or 15(d) of the Securities Exchange Act of 1934 until our offering is
completed:
(i) GECC's Annual Report on Form 10-K for the year ended December 31,
2001;
(ii) GECC's Quarterly Report on Form 10-Q for the quarter ended March 30,
2002;
(iii) GECC's Quarterly Report on Form 10-Q for the quarter ended June 29,
2002;
(iv) GECC's Quarterly Report on Form 10-Q for the quarter ended September
28, 2002; and
(v) GECC's Current Reports on Form 8-K dated as of March 25, 2002 and
September 17, 2002.
You may request a copy of these filings at no cost. Requests should be
directed to David P. Russell, Counsel--Treasury Operations and Assistant
Secretary, General Electric Capital Corporation, 260 Long Ridge Road, Stamford,
Connecticut 06927, Telephone No. (203) 357-4000.
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THE COMPANY
General Electric Capital Corporation was incorporated in 1943 in the State
of New York, under the provisions of the New York Banking Law relating to
investment companies, as successor to General Electric Contracts Corporation,
which was formed in 1932. Until November 1987, our name was General Electric
Credit Corporation. As of July 2001, General Electric Capital Corporation
completed its reincorporation as a Delaware corporation. All of our outstanding
common stock is owned by General Electric Capital Services, Inc. ("GE Capital
Services") formerly General Electric Financial Services, Inc., the common stock
of which is in turn wholly owned directly or indirectly by General Electric
Company ("GE Company"). Our business originally related principally to financing
the distribution and sale of consumer and other products of GE Company.
Currently, however, the types and brands of products we finance and the services
we offer are significantly more diversified. Very few of the products we finance
are manufactured by GE Company.
We operate in four separate financial services businesses: GE Commercial
Finance, GE Equipment Management, GE Consumer Finance and GE Insurance. Our
operations are subject to a variety of regulations in their respective
jurisdictions.
We offer our services primarily throughout the United States, Canada,
Europe and the Pacific Basin. GECC's principal executive offices are located at
260 Long Ridge Road, Stamford, Connecticut 06927 (telephone number (203)
357-4000). At December 31, 2001, GECC employed approximately 88,000 persons.
CONSOLIDATED RATIO OF EARNINGS TO FIXED CHARGES
YEAR ENDED DECEMBER 31, NINE MONTHS ENDED
1997 1998 1999 2000 2001 SEPTEMBER 28, 2002
---- ---- ---- ---- ---- ------------------
1.48 1.50 1.60 1.52 1.72 1.66
CONSOLIDATED RATIO OF EARNINGS TO COMBINED FIXED CHARGES
AND PREFERRED STOCK DIVIDENDS
YEAR ENDED DECEMBER 31, NINE MONTHS ENDED
1997 1998 1999 2000 2001 SEPTEMBER 28, 2002
---- ---- ---- ---- ---- ------------------
1.46 1.48 1.58 1.50 1.70 1.65
For purposes of computing the consolidated ratios of earnings to fixed
charges and earnings to combined fixed charges and preferred stock dividends,
earnings consist of net earnings adjusted for the provision for income taxes,
minority interest, interest capitalized (net of amortization) and fixed charges.
Fixed charges consist of interest on all indebtedness and one-third of rentals,
which we believe is a reasonable approximation of the interest factor of such
rentals.
USE OF PROCEEDS
Unless otherwise specified in the prospectus supplement accompanying this
prospectus, we will add the net proceeds from the sale of the securities to
which this prospectus and the prospectus supplement relate to our general funds
which we will use for financing our operations. We can conduct additional
financings at any time.
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PLAN OF DISTRIBUTION
We may sell our securities through agents, underwriters, dealers or
directly to purchasers.
We may designate agents to solicit offers to purchase our securities.
o We will name any agent involved in offering or selling our securities,
and any commissions that we will pay to the agent, in our prospectus
supplement.
o Unless we indicate otherwise in our prospectus supplement, our agents
will act on a best efforts basis for the period of their appointment.
o Our agents may be deemed to be underwriters under the Securities Act of
1933 of any of our securities that they offer or sell.
We may use an underwriter or underwriters in the offer or sale of our
securities.
o If we use an underwriter or underwriters, we will execute an
underwriting agreement with the underwriter or underwriters at the time
that we reach an agreement for the sale of our securities.
o We will include the names of the specific managing underwriter or
underwriters, as well as any other underwriters, and the terms of the
transactions, including the compensation the underwriters and dealers
will receive, in our prospectus supplement.
o The underwriters will use our prospectus supplement to sell our
securities.
We may use a dealer to sell our securities.
o If we use a dealer, we, as principal, will sell our securities to the
dealer.
o The dealer will then sell our securities to the public at varying prices
that the dealer will determine at the time it sells our securities.
o We will include the name of the dealer and the terms of our transactions
with the dealer in our prospectus supplement.
We may solicit directly offers to purchase our securities, and we may
directly sell our securities to institutional or other investors. We will
describe the terms of our direct sales in our prospectus supplement.
We may indemnify agents, underwriters, and dealers against certain
liabilities, including liabilities under the Securities Act of 1933. Our agents,
underwriters, and dealers, or their affiliates, may be customers of, engage in
transactions with or perform services for us, in the ordinary course of
business.
We may authorize our agents and underwriters to solicit offers by certain
institutions to purchase our securities at the public offering price under
delayed delivery contracts.
o If we used delayed delivery contracts, we will disclose that we are
using them in the prospectus supplement and will tell you when we will
demand payment and delivery of the securities under the delayed delivery
contracts.
o These delayed delivery contracts will be subject only to the conditions
that we set forth in the prospectus supplement.
o We will indicate in our prospectus supplement, the commission that
underwriters and agents soliciting purchases of our securities under
delayed contracts will be entitled to receive.
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Unless otherwise provided in the prospectus supplement accompanying this
prospectus, neither the support obligations nor the interests therein will be
offered or sold separately from the underlying securities to which they relate.
The underlying securities will be offered and sold under a separate offering
document.
GECC Capital Markets Group, Inc. is one of GECC's subsidiaries and may
participate in offerings of our securities. As a result, we will conduct any
offering of securities in which GECC Capital Markets Group, Inc. participates in
compliance with the applicable provisions of Rule 2720 of the Conduct Rules of
the National Association of Securities Dealers, Inc. Under this rule, no
underwriter or dealer may confirm sales of securities to accounts over which
they exercise discretionary authority. In the event that any NASD member
participates in a public offering of these securities: (a) the actual price and
selling terms will be disclosed in post-effective amendments or prospectus or
pricing supplements; (b) the maximum compensation to be received by any NASD
member in this distribution will be disclosed and submitted for approval with
the NASD's Corporate Financing Department (the "Department"); and (c) prior to
the commencement of the distribution, underwriting documents proposed for use
will be submitted to the Department for review. Underwriting discounts and
commissions on securities sold in the initial distribution will not exceed 8% of
the offering proceeds.
SECURITIES OFFERED
Using this prospectus, we may offer debt securities, variable cumulative
preferred stock, preferred stock, and warrants to purchase debt securities. In
addition, we may issue guarantees, direct-pay letters of credit and indebtedness
evidenced by promissory notes or loan obligations, including interests therein.
We registered these securities with the SEC using a "shelf" registration
statement. This "shelf" registration statement allows us to offer any
combination of these securities. Each time we offer securities, we must provide
a prospectus supplement that describes the specific terms of the securities. The
prospectus supplement may also provide new information or update the information
in the prospectus.
DESCRIPTION OF DEBT SECURITIES
GENERAL
The description below of the general terms of the debt securities issued
under this prospectus will be supplemented by the more specific terms in the
applicable prospectus supplement.
We will issue the debt securities under one or more separate indentures
between us and JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank),
as trustee, or any other trustee as may be designated under the indentures ( the
"Trustee"). None of the indentures limits the amount of debt securities or other
unsecured, senior debt which we may issue.
In addition to the following description of the debt securities, you should
refer to the detailed provisions of each indenture, copies of which are filed as
exhibits to the registration statement.
The prospectus supplement will specify the following terms of such issue of
debt securities:
o the designation, the aggregate principal amount and the authorized
denominations if other than $1,000 and integral multiples of $1,000;
o the percentage of their principal amount at which the debt securities
will be issued;
o the date or dates on which the debt securities will mature;
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o the currency, currencies or currency units in which we will make
payments on the debt securities;
o the rate or rates at which the debt securities will bear interest, if
any, or the method of determination of such rate or rates;
o the date or dates from which such interest, if any, shall accrue, the
dates on which such interest, if any, will be payable and the method of
determining holders to whom interest shall be payable;
o the prices, if any, at which, and the dates at or after which, we may or
must repay, repurchase or redeem the debt securities;
o the exchanges, if any, on which the debt securities may be listed;
o the trustee under the indenture pursuant to which the debt securities
are to be issued. (Sections 2.02 and 2.02A. Section references refer to
the sections in the applicable indenture.); and
o any other terms of the debt securities not inconsistent with the
provisions of the applicable indenture.
Unless otherwise specified in the prospectus supplement, we will compute
interest payments on the basis of a 360-day year consisting of twelve 30-day
months. (Section 2.10).
The debt securities will be unsecured and will rank equally with all other
unsecured and unsubordinated indebtedness of GECC.
Some of the debt securities may be issued as discounted debt securities to
be sold at a substantial discount below their stated principal amount. The
prospectus supplement will contain any Federal income tax consequences and other
special considerations applicable to discounted debt securities.
The indentures do not contain any provisions that:
o limit our ability to incur indebtedness, or
o provide protection in the event GE Company, as sole indirect stockholder
of GECC, causes GECC to engage in a highly leveraged transaction,
reorganization, restructuring, merger or similar transaction.
PAYMENT AND TRANSFER
We will issue debt securities only as registered securities, which means
that the name of the holder will be entered in a register which will be kept by
the Trustee or another agent of GECC. Unless we state otherwise in a prospectus
supplement, we will make principal and interest payments at the office of the
paying agent or agents we name in the prospectus supplement or by mailing a
check to such holder at the address specified in the register.
Unless we describe other procedures in a prospectus supplement, a
registered holder will be able to transfer registered debt securities at the
office of the transfer agent or agents we name in the prospectus supplement. The
registered holder may also exchange registered debt securities at the office of
the transfer agent for an equal aggregate principal amount of registered debt
securities of the same series having the same maturity date, interest rate and
other terms as long as the debt securities are issued in authorized
denominations.
Neither GECC nor the Trustee will impose any service charge for any such
transfer or exchange of a debt security, however, a registered holder may be
required to pay any taxes or other governmental charges in connection with a
transfer or exchange of debt securities.
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GLOBAL NOTES, DELIVERY AND FORM
We may issue some or all of the debt securities in the form of one or more
Global Notes representing an entire issuance in book-entry form. We will deposit
each Global Note with a depositary (a "Depositary") or with a nominee for a
Depositary identified in the applicable prospectus supplement. We will register
each Global Note in the name of such Depositary or nominee. Unless and until it
is exchanged in whole or in part for debt securities in definitive registered
form, a Global Note may not be transferred, except as a whole by the Depositary
for such Global Note to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any such nominee to a successor of such Depositary or a nominee of
such successor. For purposes of this Prospectus, "Global Note" refers to the
Global Note or Global Notes representing an entire issue of debt securities.
The specific terms of the depositary arrangement with respect to any debt
securities to be represented by a Global Note will be described in the
prospectus supplement.
MODIFICATION OF THE INDENTURES
In general, our rights and obligations and the rights of the holders under
the above-referenced indentures may be modified if the holders of not less than
66 2/3% in aggregate principal amount of the outstanding debt securities of each
series affected by the modification consent to it. However, Section 10.02 of
each indenture provides that, unless each affected holder agrees, we cannot
o make any adverse change to any payment term of a debt security such as
o extending the maturity date
o extending the date on which we have to pay interest or make a sinking
fund payment
o reducing the interest rate
o reducing the amount of principal we have to repay
o changing the currency in which we have to make any payment of principal
premium or interest
o modifying any redemption or repurchase right to the detriment of the
holder
o impairing any right of a holder to bring suit for payment
o reduce the percentage of the aggregate principal amount of debt
securities needed to make any amendment to the indenture or to waive any
covenant or default
o waive any past payment default
o make any change to Section 10.02.
However, if we and the Trustee agree, we can amend the indentures without
notifying any holders or seeking their consent if the amendment does not
materially and adversely affect any holder.
EVENTS OF DEFAULT
Each indenture defines an Event of Default with respect to any series of
debt securities as any of the following:
o default in any payment of principal or premium, if any, on any debt
security of such series;
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o default for 30 days in payment of any interest, if any, on any debt
security of such series;
o default in the making or satisfaction of any sinking fund payment or
analogous obligation on the debt securities of such series;
o default for 60 days after written notice to GECC in performance of any
other covenant in respect of the debt securities of such series
contained in such indenture;
o a default, as defined, with respect to any other series of debt
securities outstanding under the relevant Indenture or as defined in any
other indenture or instrument evidencing or under which GECC has
outstanding any indebtedness for borrowed money, as a result of which
such other series or such other indebtedness of GECC shall have been
accelerated and such acceleration shall not have been annulled within 10
days after written notice thereof (PROVIDED, that the resulting Event of
Default with respect to such series of debt securities may be remedied,
cured or waived by the remedying, curing or waiving of such other
default under such other series or such other indebtedness); or
o certain events involving bankruptcy, insolvency or reorganization.
(Section 6.01).
Each indenture requires us to deliver to the Trustee annually a written
statement as to the presence or absence of certain defaults under the terms
thereof. (Section 4.06). An Event of Default under one series of debt securities
does not necessarily constitute an Event of Default under any other series of
debt securities. Each Indenture provides that the Trustee may withhold notice to
the holders of any series of debt securities issued thereunder of any default if
the Trustee considers it in the interest of such Noteholders to do so provided
the Trustee may not withhold notice of default in the payment of principal,
premium, if any, or interest, if any, on any of the debt securities of such
series or in the making of any sinking fund installment or analogous obligation
with respect to such series. (Section 6.08).
Each indenture provides that if an Event of Default occurs and is
continuing with respect to any series of debt securities, either the Trustee or
the holders of not less than 25% in aggregate principal amount of the
outstanding debt securities of such series may declare the principal, or in the
case of discounted debt securities, a portion of the principal amount, of all
such debt securities to be due and payable immediately. Under certain conditions
such declaration may be annulled by the holders of a majority in principal
amount of such debt securities then outstanding. The holders of a majority in
principal amount of such debt securities then outstanding may also waive on
behalf of all holders past defaults with respect to a particular series of debt
securities except, unless previously cured, a default in payment of principal,
premium, if any, or interest, if any, on any of the debt securities of such
series, or the payment of any sinking fund instalment or analogous obligation on
the debt securities of such series (Sections 6.01 and 6.07).
Other than the duties of a trustee during a default, the Trustee is not
obligated to exercise any of its rights or powers under the indenture at the
request, order or direction of any holders of debt securities of any series
issued thereunder unless such holders shall have offered to the Trustee
reasonable indemnity. (Sections 7.01 and 7.02). Subject to such indemnification
provision, each indenture provides that the holders of a majority in principal
amount of the debt securities of any series issued thereunder at the time
outstanding shall have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee thereunder, or
exercising any trust or power conferred on such Trustee with respect to the debt
securities of such series. However, the Trustee may decline to act if it has not
been offered reasonable indemnity or if it determines that the proceedings so
directed would be illegal or involve it in any personal liability. (Section
6.07).
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CONCERNING THE TRUSTEE
JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), as
successor to The Bank of New York, acts as Trustee under (i) an Amended and
Restated Indenture with us dated as of February 27, 1997, as supplemented by a
Supplemental Indenture with us dated as of May 3, 1999 and a Second Supplemental
Indenture with us dated as of July 2, 2001, (ii) an Amended and Restated
Indenture with us dated as of February 28, 1997, as supplemented by a First
Supplemental Indenture with us dated as of July 2, 2001, (iii) an indenture with
us dated as of June 3, 1994, as amended and supplemented, and (iv) an indenture
with us dated as of October 1, 1991, as amended and supplemented. JPMorgan Chase
Bank also acts as Trustee under certain other indentures with us. A number of
our series of senior, unsecured notes are presently outstanding under each of
such indentures. Debt securities may be issued under either of the indentures
referred to in clauses (i) and (ii) above.
GECC, GE Company and other affiliates of GE Company maintain various
commercial and investment banking relationships with JPMorgan Chase Bank and its
affiliates in their ordinary course of business.
DESCRIPTION OF WARRANTS
GENERAL
We may issue warrants to purchase debt securities under this prospectus
either alone or together with debt securities. In addition to this summary, you
should refer to the detailed provisions of the specific warrant agreement for
complete terms of the warrants and the warrant agreement. Each warrant agreement
will be between GECC and a banking institution organized under the laws of the
United States or a state. A form of warrant agreement was filed as an exhibit to
the Registration Statement.
The warrants will be evidenced by warrant certificates. Unless otherwise
specified in the prospectus supplement, the warrant certificates may be traded
separately from the debt securities, if any, with which the warrant certificates
were issued. Warrant certificates may be exchanged for new warrant certificates
of different denominations at the office of an agent that we will appoint. Until
a warrant is exercised, the holder of a warrant does not have any of the rights
of a debtholder and is not entitled to any payments on, any debt securities
issuable upon exercise of the warrants.
We may issue warrants in one or more series. The prospectus supplement
accompanying this prospectus relating to the particular series of warrants, will
contain terms of the warrants, including:
o the title and the aggregate number of warrants;
o the debt securities for which each warrant is exercisable;
o the date or dates on which such warrants will expire;
o the price or prices at which such warrants are exercisable;
o the currency or currencies in which such warrants are exercisable;
o the periods during which and places at which such warrants are
exercisable;
o the terms of any mandatory or optional call provisions;
o the price or prices, if any, at which the warrants may be redeemed at
the option of the holder or will be redeemed upon expiration;
o the identity of the warrant agent; and
o the exchanges, if any, on which such warrants may be listed.
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EXERCISE OF WARRANTS
You may exercise warrants by payment to our warrant agent of the exercise
price, in each case in such currency or currencies as are specified in the
warrant, and giving your identity and the number of warrants to be exercised.
Once you pay our warrant agent and deliver the properly completed and executed
warrant certificate to our warrant agent at the specified office, our warrant
agent will, as soon as practicable, forward notes to you in authorized
denominations. If you exercise less than all of the warrants evidenced by your
warrant certificate, you will be issued a new warrant certificate for the
remaining amount of warrants.
DESCRIPTION OF THE PREFERRED STOCK
GENERAL
Our Board of Directors has authorized the issuance of preferred stock. The
terms of the preferred stock will be stated and expressed in a resolution or
resolutions to be adopted by our Board of Directors (or any duly authorized
committee of the Board of Directors) consistent with our restated certificate of
incorporation. The preferred stock, when issued and sold, will be fully paid and
non-assessable and will have no pre-emptive rights.
As of the date of this prospectus, our capital stock as authorized by our
sole common stockholder consists of:
o 3,866,000 shares of Common Stock, par value $4.00 per share,
o 33,000 shares of Variable Cumulative Preferred Stock, par value $100 per
share, and
o 750,000 shares of Preferred Stock, par value $.01 per share.
IN ORDER TO DISTINGUISH BETWEEN OUR TWO CLASSES OF PREFERRED STOCK, WE WILL
REFER TO THE FIRST CLASS OF OUR PREFERRED STOCK AS "VARIABLE CUMULATIVE
PREFERRED STOCK" AND TO THE SECOND CLASS AS OUR "SECOND CLASS OF PREFERRED
STOCK". When we refer to both classes we use the phrase "preferred stock."
3,837,825 shares of Common Stock and 26,000 shares of Variable Cumulative
Preferred Stock are presently outstanding. There are no shares of our second
class of preferred stock currently outstanding. Each Series of Variable
Cumulative Preferred Stock ranks equally with each other Series of Variable
Cumulative Preferred Stock as to dividend and liquidation preference.
We will describe the particular terms of any series of preferred stock
being offered by use of this prospectus in the prospectus supplement relating to
that series of preferred stock. Those terms may include:
o the designation, number of shares and stated value per share;
o the amount of liquidation preference;
o the initial public offering price at which shares of such series of
preferred stock will be sold;
o the dividend rate or rates (or method of determining the dividend rate);
o the dates on which dividends shall be payable, the date from which
dividends shall accrue and the record dates for determining the holders
entitled to such dividends;
o any redemption or sinking fund provisions;
o any voting rights;
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o any conversion or exchange provisions;
o any provisions to issue the shares of such series as depositary shares
evidenced by depositary receipts; and
o any additional dividend, redemption, liquidation or other preferences or
rights and qualifications, limitations or restrictions thereof.
If the terms of any series of preferred stock being offered differ from the
terms set forth below, we will also disclose those terms in the prospectus
supplement relating to that series of preferred stock. In addition to this
summary, you should refer to our restated certificate of incorporation for the
complete terms of preferred stock being offered.
We will specify the transfer agent, registrar, dividend disbursing agent
and redemption agent for each series of preferred stock in the prospectus
supplement relating to that series.
DIVIDEND RIGHTS
If you purchase preferred stock being offered by this prospectus, you will
be entitled to receive, when, and as declared by our board of directors, cash or
other dividends at the rates, or as determined by the method described in, and
on the dates set forth in, the prospectus supplement. Dividend rates may be
fixed or variable or both. Different series of preferred stock may be entitled
to dividends at different dividend rates or based upon different methods of
determination. We will pay each dividend to the holders of record as they appear
on our stock books on record dates determined by the board of directors.
Dividends on any series of the preferred stock may be cumulative or
noncumulative, as specified in the prospectus supplement. If the board of
directors fails to declare a dividend on any series of preferred stock for which
dividends are noncumulative, then your right to receive that dividend will be
lost, and we will have no obligation to pay the dividend for that dividend
period, whether or not we declare dividends for any future dividend period.
Dividends on the shares of preferred stock will accrue from the date on which we
initially issue such series of preferred stock or as otherwise set forth in the
prospectus supplement relating to such series. The prospectus supplement
relating to a series of preferred stock will describe any adjustments to be
made, if any, to the dividend rate in the event of certain amendments to the
Internal Revenue Code of 1986, as amended, with respect to the
dividends-received deduction.
In particular, the dividend payment dates on the Variable Cumulative
Preferred Stock will be the last day of each dividend period, regardless of its
length, and, in the case of dividend periods of more than 99 days, on the
following additional dates:
o if such Dividend Period is from 100 to 190 days, on the 91st day;
o if such Dividend Period is from 191 to 281 days, on the 91st and 182nd
days;
o if such Dividend Period is from 282 to 364 days, on the 91st, 182nd and
273rd days; and
o if such Dividend Period is from two to 30 years, on January 15, April
15, July 15 and October 15 of each year.
In the event a dividend payment date falls on a day that is not a business
day, then the dividend payment date shall be the business day next succeeding
such date. After the initial dividend period, each subsequent dividend period
will begin on a dividend payment date and will end 49 days later. However, we
may elect subsequent dividend periods that are longer than 49 days. We will
notify you of any such election and follow the procedures that will be set forth
in a prospectus supplement for the series of Variable Cumulative Preferred
Stock. After the initial dividend period, the dividend rates on the Variable
Cumulative Preferred Stock will be determined pursuant
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to an auction method, subject to any maximum or minimum interest rate, which
will be described in the prospectus supplement relating to such series of
Variable Cumulative Preferred Stock.
The dividend payment dates and the dividend periods with respect to our
second class of preferred stock will be described in the prospectus supplement
relating to such series of our second class of preferred stock.
We may not declare any dividends on any shares of common stock, or make any
payment on account of, or set apart money for, a sinking or other analogous fund
for the purchase, redemption or other retirement of any shares of common stock
or make any distribution in respect thereof, whether in cash or property or in
obligations or our stock, other than common stock unless
o full cumulative dividends shall have been paid or declared and set apart
for payment on all outstanding shares of preferred stock and other
classes and series of our preferred stock and
o we are not in default or in arrears with respect to any sinking or other
analogous fund or other agreement for the purchase, redemption or other
retirement of any shares of our preferred stock.
In the event we have outstanding shares of more than one series of our
preferred stock ranking equally as to dividends and dividends on one or more of
such series of preferred stock are in arrears, we are required to make dividend
payments ratably on all outstanding shares of such preferred stock in proportion
to the respective amounts of dividends in arrears on all such preferred stock to
the date of such dividend payment. You will not be entitled to any dividend,
whether payable in cash, property or stock, in excess of full cumulative
dividends on shares of the preferred stock you own. No interest, or sum of money
in lieu of interest, shall be payable in respect of any dividend payment or
payments which may be in arrears.
LIQUIDATION RIGHTS
In the event of our liquidation, either voluntary or involuntary,
dissolution or winding-up, we will be required to pay the liquidation preference
specified in the prospectus supplement relating to those shares of preferred
stock, plus accrued and unpaid dividends, before we make any payments to holders
of our common stock or any other class of our stock ranking junior to that
preferred stock. If we do not have sufficient assets to pay the liquidation
preference, plus accrued and unpaid dividends, on all classes of preferred stock
that rank equally upon liquidation, we will pay holders of the preferred stock
proportionately based on the full amount to which they are entitled. Other than
their claims to the liquidation preference and accrued and unpaid dividends,
holders of preferred stock will have no claim to any of our other remaining
assets. Neither the sale of all or substantially all our property or business
nor a merger or consolidation by us with any other corporation will be
considered a dissolution, liquidation or winding-up of our business or affairs,
if that transaction does not impair the voting power, preferences or special
rights of the holders of shares of preferred stock.
VOTING RIGHTS
Holders of our common stock are entitled to one vote per share on all
matters which arise at any meeting of shareholders. Holders of preferred stock
being offered by this prospectus will not be entitled to vote, except as set
forth below, in a prospectus supplement or as otherwise required by law.
The holders of Variable Cumulative Preferred Stock are not entitled to vote
except as required by law or as set forth in a prospectus supplement. However,
we may not alter any of the preferences, privileges, voting powers or other
restrictions or qualifications of a series of Variable Cumulative Preferred
Stock in a manner substantially prejudicial to the holders thereof without the
consent of the holders of at least 66 2/3% of the total number of shares of such
series.
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With respect to our second class of preferred stock, in the event that six
quarterly dividends (whether or not consecutive) payable on any series of our
second class of preferred stock shall be in arrears, the holders of each series
of our second class of preferred stock, voting separately as a class with all
other holders of preferred stock with equal voting rights, shall be entitled at
our next annual meeting of stockholders (and at each subsequent annual meeting
of stockholders), to vote for the election of two of our directors, with the
remaining directors to be elected by the holders of shares of any other class or
classes or series of stock entitled to vote therefor. Until the arrears in
payments of all dividends which permitted the election of such directors shall
cease to exist, any director who has been so elected may be removed at any time,
either with or without cause, only by the affirmative vote of the holders of the
preferred stock at the time entitled to cast a majority of the votes entitled to
be cast for the election of any such director at a special meeting of such
holders called for that purpose, and any vacancy thereby created may be filled
by the vote of such holders. The holders of shares of our second class of
preferred stock shall no longer be entitled to vote for directors once the past
due dividends have all been paid unless dividends later become in arrears again.
Once the past due dividends have all been paid, then the directors elected by
the preferred stockholders will no longer be directors.
We may not take certain actions without the consent of at least 66 2/3% of
the shares of our second class of preferred stock, voting together as a single
class without regard to series. We need such 66 2/3% consent to:
o create any class or series of stock with preference as to dividends or
distributions of assets over any outstanding series of our second class
of preferred stock (other than a series which has no right to object to
such creation) or
o alter or change the provisions of our restated certificate of
incorporation so as to adversely affect the voting power, preferences or
special rights of the holders of shares of our second class of preferred
stock; provided, however, that if such creation or such alteration or
change would adversely affect the voting power, preferences or special
rights of one or more, but not all, series of our second class of
preferred stock at the time outstanding, consent of the holders of
shares entitled to cast at least 2/3rds of the votes entitled to be cast
by the holders of all of the shares of ALL SUCH SERIES so AFFECTED,
voting as a class, shall be required in lieu of the consent of ALL
holders of 2/3rds of our second class of preferred stock at the time
outstanding.
The prospectus supplement relating to a series of preferred stock will
further describe the voting rights, if any, including the number of or
proportional votes per share.
REDEMPTION
The applicable prospectus supplement will indicate whether the series of
preferred stock being offered is subject to redemption, in whole or in part,
whether at our option or mandatorily or otherwise and whether or not pursuant to
a sinking fund. The redemption provisions that may apply to a series of
preferred stock being offered, including the redemption dates and the redemption
prices for that series will be set forth in the prospectus supplement.
If we fail to pay dividends on any series of preferred stock we may not
redeem that series in part and we may not purchase or otherwise acquire any
shares of such series other than by a purchase or exchange offer made on the
same terms to holders of all outstanding shares of such series.
We may redeem the shares of any series of Variable Cumulative Preferred
Stock out of legally available funds therefore, as a whole or from time to time
in part:
o on the last day of any dividend period at a redemption price of $100,000
per share, plus accumulated and unpaid dividends to the date fixed for
redemption and
13
o in the case of shares of Variable Cumulative Preferred Stock with a
dividend period equal to or more than two years, on any dividend payment
date for such shares at redemption prices (but not less than $100,000
per share) determined by us prior to the commencement of such dividend
period plus accumulated and unpaid dividends to the date set forth for
redemption.
CONVERSION RIGHTS
No series of preferred stock will be convertible into our common stock.
DESCRIPTION OF SUPPORT OBLIGATIONS AND INTERESTS THEREIN
GENERAL
Support obligations issued under this prospectus may include guarantees,
letters of credit and promissory notes or loan obligations that are issued in
connection with, and as a means of underlying credit support for, any part of a
fixed or contingent payment obligation of primary securities issued by third
parties. The issuers of the primary securities may or may not be affiliated with
us. A holder of a primary security will also hold uncertificated interests in
the related support obligation, representing the credit enhancement of the
holder's primary security afforded by the related support obligation.
The terms and conditions of any support obligations and related interests
will be determined by the terms and conditions of the related underlying
securities, and may vary from the general descriptions set forth below.
A complete description of the terms and conditions of any support obligations
and related interests issued pursuant to this prospectus will be set forth in
the accompanying prospectus supplement.
Unless otherwise specified in the applicable prospectus supplement, any
support obligations and related interests will be unsecured and will rank
equally and ratably with all of our other unsecured and unsubordinated
indebtedness. The terms of a particular support obligation may provide that a
different support obligation may be substituted therefor, upon terms and
conditions described in the applicable prospectus supplement, provided that such
substitution is carried out in conformity with the Securities Act of 1933 and
the rules and regulations thereunder. Unless otherwise specified in the
accompanying prospectus supplement, each support obligation will be governed by
the law of the State of New York. Neither the Support Indenture (as defined
hereinafter) (with respect to promissory notes and loan obligations) nor any
other document or instrument (with respect to other forms of support
obligations) will (i) limit the amount of support obligations or interests that
may be issued, or (ii) contain any provisions that limit our ability to incur
indebtedness or that afford holders of support obligations or interests
protection in the event GE Company, as our ultimate stockholder, causes us to
engage in a highly leveraged transaction, reorganization, restructuring, merger
or similar transaction.
GUARANTEES
Any guarantees that we issue from time to time under this prospectus for
the benefit of holders of specified underlying securities will include the
following terms and conditions, plus any additional terms specified in the
accompanying prospectus supplement.
The guarantee will provide that we unconditionally guarantee the due and
punctual payment of the principal, interest (if any), premium (if any) and all
other amounts due under the applicable underlying securities when the same shall
become due and payable, whether at maturity, pursuant to mandatory or optional
prepayments, by acceleration or otherwise, in each case after any applicable
grace periods or notice requirements, according to the terms of the applicable
underlying securities. Any guarantee shall be unconditional irrespective of the
validity or
14
enforceability of the applicable underlying security, any change or amendment
thereto or any other circumstances that may otherwise constitute a legal or
equitable discharge or defense of a guarantor. However, we will not waive
presentment or demand of payment or notice with respect to the applicable
underlying security unless otherwise provided in the accompanying prospectus
supplement.
We shall be subrogated to all rights of the issuer of the applicable
underlying securities in respect of any amounts paid by us pursuant to the
provisions of a guarantee. The guarantee shall continue to be effective or
reinstated, as the case may be, if at any time any payment made by the issuer of
the applicable underlying security is rescinded or must otherwise be returned
upon the insolvency, bankruptcy or reorganization of GECC, the issuer of the
applicable underlying security or otherwise.
LETTERS OF CREDIT
The direct-pay letters of credit we issue from time to time under this
prospectus relating to specified underlying securities shall include the
following terms and conditions, plus any additional terms specified in the
accompanying prospectus supplement.
Any letter of credit will be our direct-pay obligation issued for the
account of the holders of the applicable underlying securities or, in certain
cases, an agent acting on behalf of the issuer of the applicable underlying
securities or a trustee acting on behalf of the holders. The letter of credit
will be issued in an amount that corresponds to principal and, if applicable,
interest and other payments payable with respect to the applicable underlying
securities. Drawings under the letter of credit will reduce the amount available
under the letter of credit, but drawings of a recurring nature (such as
interest) will automatically be reinstated following the date of repayment
provided that the letter of credit has not otherwise expired.
The letter of credit will expire at a date and time specified in the
accompanying prospectus supplement, and will also expire upon the earlier
occurrence of certain events, as described in the accompanying prospectus
supplement.
PROMISSORY NOTES OR LOAN OBLIGATIONS
We may incur underlying indebtedness from time to time to an issuer of
primary securities, such indebtedness to be evidenced by promissory notes, loan
agreements or other evidences of indebtedness. The purpose of issuing any such
promissory note, loan agreement or other indebtedness will be to enable us,
directly or indirectly, to provide funds for payment of the primary securities
by means of our repayment obligation as evidenced by the promissory note, loan
agreement or other indebtedness. The promissory notes, loan agreements or other
indebtedness will provide that only the issuer of the primary securities to
which such promissory notes, loan agreements or other indebtedness relate or the
issuer's assignee will be entitled to enforce such promissory notes, loan
agreements or other indebtedness against us. Holders of the relevant primary
securities will not have any third party beneficiary or other rights under, or
be entitled to enforce, the relevant promissory notes, loan agreements or other
indebtedness. The terms and provisions of any such note, loan agreement or other
indebtedness, including principal amount, provisions or interest and premium, if
applicable, maturity, prepayment provisions, if any, and identity of obligee,
will be described in the applicable prospectus supplement.
INDENTURE FOR CERTAIN SUPPORT OBLIGATIONS
Obligations that are issued in the form of promissory notes or loan
obligations, and the related interests, may be issued under an indenture, dated
as of June 3, 1994 between us and JPMorgan Chase Bank (formerly known as The
Chase Manhattan Bank), as successor trustee, as supplemented by a First
Supplemental Indenture dated as of
15
February 1, 1997 and a Second Supplemental Indenture dated as of July 2, 2001
(the "Support Indenture"). To the extent that the following disclosure
summarizes certain provisions of the indenture, such summaries do not purport to
be complete, and are subject to, and are qualified in their entirety by
reference to, all the provisions of the Support Indenture, a form of which is
filed as an exhibit to the registration statement of which this prospectus is a
part.
The following is a summary of certain provisions which will apply to any
promissory notes or loan obligations issued pursuant to the Support Indenture.
MODIFICATION: In general, our rights and obligations and the rights of the
holders under the indenture may be modified if the holders of not less than
662/3% in aggregate principal amount of the outstanding support obligations of
each series affected by the modification consent to it. However, Section 10.2 of
the Support Indenture provides that, unless each affected holder agrees, we
cannot
o change the character of any support obligation from being payable other
than as provided in any related support obligation agreement;
o reduce the principal amount of a support obligation;
o change the currency in which we have to make payment on a support
obligation to a currency other than United States dollars; or
o reduce the percentage of the aggregate principal amount of support
obligations needed to make any amendment to the indenture.
However, if we and the Trustee agree, we can amend the Support Indenture
without notifying any holders or seeking their consent if the amendment does not
materially and adversely affect any holder.
EVENT OF DEFAULT: Any event of default with respect to any series of
support obligations issued pursuant to the Support Indenture is defined in the
Support Indenture as being (a) a default in any payment of principal or premium,
if any, or interest on any support obligation of such series in accordance with
the terms of the related credit support agreement; or (b) any other event of
default as defined in the related credit support agreement to the extent
specifically identified pursuant to Section 2.2 of the Support Indenture.
(Section 6.1). The Support Indenture requires us to deliver to the Trustee
annually a written statement as to the presence or absence of certain defaults
under the terms thereof. (Section 4.4). No event of default with respect to a
particular series of support obligations under the Support Indenture necessarily
constitutes an event of default with respect to any other series of support
obligations issued thereunder or other series of support obligations not
entitled to the benefits of the Support Indenture.
The Support Indenture provides that during the continuance of an event of
default with respect to any series of support obligations issued pursuant to the
Support Indenture, either the Trustee or the holders of 25% in aggregate
principal amount of the outstanding support obligations of such series and the
interests of such series (voting together as a single class) may declare the
principal of all such support obligations to be due and payable immediately, but
under certain conditions such declaration may be annulled by the holders of a
majority in principal amount of such support obligations then outstanding. The
Support Indenture provides that past defaults with respect to a particular
series of support obligations issued under the Support Indenture (except, unless
theretofore cured, a default in payment of principal of, or interest on any of
the support obligations of such series) may be waived on behalf of the holders
of all support obligations of such series by the holders of a majority in
principal amount of such support obligations then outstanding. (Sections 6.1 and
6.7).
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Subject to the provisions of the Support Indenture relating to the duties
of the Trustee in case an event of default with respect to any series of support
obligations issued pursuant to the Support Indenture shall occur and be
continuing, the Trustee shall be under no obligation to exercise any of its
rights or powers under the Support Indenture at the request, order or direction
of any holders of support obligations of any series issued thereunder unless
such holders shall have offered to the Trustee reasonable indemnity. (Section
6.4). Subject to such indemnification provision, the Support Indenture provides
that the holders of a majority in principal amount of the support obligations of
any series issued pursuant to the Support Indenture and the interests of such
series (voting together as a single class) thereunder at the time outstanding
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee with respect to the support obligations of such
series, provided that the Trustee may decline to follow any such direction if it
has not been offered reasonable indemnity therefor or if it determines that the
proceedings so directed would be illegal or involve it in any personal
liability. (Section 6.7).
CONCERNING THE TRUSTEE
JPMorgan Chase Bank (formerly known as The Chase Manhattan Bank), as
successor to Mercantile-Safe Deposit and Trust Company, acts as Trustee under
the Support Indenture. JPMorgan Chase Bank also acts as Trustee under several
other indentures with us, pursuant to which a number of series of senior,
unsecured notes of ours are presently outstanding.
GECC, GE Company and other affiliates of GE Company maintain various
commercial and investment banking relationships with JPMorgan Chase Bank and its
affiliates in their ordinary course of business.
LEGAL OPINIONS
Unless otherwise specified in the prospectus supplement accompanying this
prospectus, Alan M. Green, Associate General Counsel and Assistant Secretary of
GECC will provide an opinion for us regarding the validity of the securities and
Davis Polk & Wardwell, 450 Lexington Avenue, New York, New York 10017 will
provide an opinion for the underwriters, agents or dealers. Mr. Green
beneficially owns or has rights to acquire an aggregate of less than 0.01% of GE
Company's common stock.
EXPERTS
The audited consolidated financial statements incorporated in this
prospectus by reference to GECC's Annual Report on Form 10-K for the year ended
December 31, 2001, as conformed to reflect organizational changes and the
exclusion of goodwill amortization and included as an exhibit to GECC's report
on Form 8-K dated September 17, 2002, have been incorporated by reference herein
in reliance upon the report of KPMG LLP, independent certified public
accountants, and upon the authority of said firm as experts in accounting and
auditing. As discussed in Note 1 to the consolidated financial statements, GECC
in 2001 changed its method of accounting for derivative instruments and hedging
activities and impairment of certain beneficial interests in securitized assets.
17
[LOGO] GE CAPITAL
GE CAPITAL
$20,000,000,000
INTERNOTES
Prospectus Supplement
November 22, 2002
[LOGO] GE CAPITAL