As filed with the Securities and Exchange Commission on May 16, 2001
Registration No. 333-58176
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
Under the Securities Act of 1933
--------------
MOTOROLA, INC.
(Exact name of Registrant as specified in its charter)
--------------
Delaware 36-1115800
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation)
--------------
1303 East Algonquin Road
Schaumburg, Illinois 60196
(847) 576-5000
(Address, including zip code, and telephone number, including area code, of
Registrant's principal executive offices)
--------------
With a copy to:
Carl F. Koenemann Jeffrey A. Brown Oscar A. David
Executive Vice President Senior Counsel R. Cabell Morris, Jr.
and Chief Financial 1303 East Algonquin Road Winston & Strawn
Officer Schaumburg, Illinois 60196 35 West Wacker Drive
1303 East Algonquin Road (847) 576-5014 Chicago, Illinois 60601
Schaumburg, Illinois (312) 558-5600
60196
(847) 576-5000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
--------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act of 1933, please check the
following box and list the Securities Act registration statement number of the
earlier registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act of 1933, please check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434
under the Securities Act of 1933, please check the following box. [_]
--------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until this Registration
Statement shall become effective on such date as the Commission, acting
pursuant to said Section 8(a), may determine.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this preliminary prospectus is not complete and may be +
+changed. We cannot sell these securities until the registration statement +
+covering them has been declared effective by the SEC. This preliminary +
+prospectus is not an offer to sell these securities and we are not soliciting +
+offers to buy these securities in any state where the offer or sale is not +
+permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED MAY 16, 2001
PROSPECTUS
$2,000,000,000
[MOTOROLA LOGO]
Debt Securities and Debt Securities Warrants
Common Stock and Common Stock Warrants
Stock Purchase Contracts and Stock Purchase Units
-----------
We may use this prospectus to offer and sell securities from time to time.
The types of securities we may sell include:
. unsecured senior debt securities
. unsecured subordinated debt securities
. warrants to purchase debt securities
. common stock
. warrants to purchase common stock
. stock purchase contracts
. stock purchase units
. units consisting of any combination of these securities
We will provide the specific terms of these securities in supplements to this
prospectus prepared in connection with each offering. The securities offered
will contain other significant terms and conditions. Please read this
prospectus and the applicable prospectus supplement carefully before you
invest.
-----------
These securities have not been approved by the Securities and Exchange
Commission or any state securities commission, nor have they determined if this
prospectus is accurate or complete. Any representation to the contrary is a
criminal offense.
-----------
The date of this prospectus is , 2001.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission using a "shelf" registration process. You
should read this prospectus and the applicable prospectus supplement together
with the additional information described below under the heading "Where You
Can Find More Information."
The registration statement that contains this prospectus (including the
exhibits) contains additional important information about Motorola, Inc. and
the securities offered under this prospectus. Specifically, we have filed
certain legal documents that control the terms of the securities offered by
this prospectus as exhibits to the registration statement. We will file certain
other legal documents that control the terms of the securities offered by this
prospectus as exhibits to reports we file with the SEC. That registration
statement and the other reports can be read at the SEC web site or at the SEC
offices mentioned under the heading "Where You Can Find More Information."
2
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at the SEC's web site at http://www.sec.gov. You may also read and
copy any document we file with the SEC at its public reference facilities at
450 Fifth Street, N.W., Washington, D.C. 20549. You can also obtain copies of
the documents at prescribed rates by writing to the Public Reference Section
of the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549. Please call the
SEC at 1-800-SEC-0330 for further information on the operation of the public
reference facilities. Our SEC filings are also available at the office of the
New York Stock Exchange. For further information on obtaining copies of our
public filings at the New York Stock Exchange, you should call (212) 656-5060.
We "incorporate by reference" into this prospectus the information we file
with the SEC, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
an important part of this prospectus and information that we file subsequently
with the SEC will automatically update this prospectus. We incorporate by
reference the documents listed below and any filings we make with the SEC
under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of
1934 after the initial filing of the registration statement that contains this
prospectus and prior to the time that we sell all the securities offered by
this prospectus:
. Annual Report on Form 10-K for the fiscal year ended December 31, 2000.
. Quarterly Report on Form 10-Q for the quarter ended March 31, 2001.
. Current Report on Form 8-K, dated April 3, 2001.
. The description of our common stock included in the Registration
Statement on Form 8-B dated
July 2, 1973, including any amendments or reports filed for the purpose
of updating such description.
. The description of our preferred stock purchase rights included in the
Registration Statement on Form 8-A dated November 5, 1998, as amended.
You may request a copy of these filings (other than exhibits, unless that
exhibit is specifically incorporated by reference into that filing) at no
cost, by writing to or telephoning us at the following address:
A. Peter Lawson
Secretary, Motorola, Inc.
1303 East Algonquin Road
Schaumburg, Illinois 60196
Telephone: (847) 576-5000.
You should rely only on the information contained or incorporated by
reference in this prospectus or the applicable prospectus supplement. We have
not authorized anyone else to provide you with different information. We may
only use this prospectus to sell securities if it is accompanied by a
prospectus supplement. We are only offering these securities in states where
the offer is permitted. You should not assume that the information in this
prospectus or the applicable prospectus supplement is accurate as of any date
other than the dates on the front of those documents.
3
THE COMPANY
Motorola is a global leader in providing integrated communications solutions
and embedded electronic solutions. These include:
. Software-enhanced wireless telephone, two-way radio and messaging
products and systems, as well as networking and Internet-access
products, for consumers, network operators, and commercial, government
and industrial customers.
. End-to-end systems for the delivery of interactive digital video, voice
and high-speed data solutions for broadband operators.
. Embedded semiconductor solutions for customers in the networking and
computing, transportation, wireless communications and digital
consumer/home networking markets.
. Embedded electronic systems for automotive, industrial, transportation,
navigation, communication and energy systems markets.
Motorola is a corporation organized under the laws of the State of Delaware
as the successor to an Illinois corporation organized in 1928. Motorola's
principal executive offices are located at 1303 East Algonquin Road,
Schaumburg, Illinois 60196 (telephone number (847) 576-5000).
USE OF PROCEEDS
Unless the applicable prospectus supplement provides otherwise, we will use
the net proceeds from the sale of the offered securities for general corporate
purposes.
RATIOS OF EARNINGS TO FIXED CHARGES
The following are the unaudited consolidated ratios of earnings to fixed
charges for each of the years in the five-year period ended December 31, 2000
and the three months ended March 31, 2001:
Year Ended December 31, Three Months
------------------------- Ended
2000 1999 1998 1997 1996 March 31, 2001
---- ---- ---- ---- ---- --------------
Ratio of earnings to fixed charges..... 3.9 3.5 --(a) 6.3 5.2 --(b)
--------
(a) Earnings were inadequate to cover fixed charges by $1.2 billion.
(b) Earnings were inadequate to cover fixed charges by $566 million.
For purposes of computing the ratios of earnings to fixed charges, we have
divided income before income tax expense plus fixed charges by fixed charges.
Fixed charges consist of interest costs and estimated interest included in
rentals (one-third of net rental expense).
4
DESCRIPTION OF DEBT SECURITIES
The following is a general description of the debt securities that we may
offer from time to time. The particular terms of the debt securities offered by
any prospectus supplement and the extent, if any, to which the general
provisions described below may apply will be described in the applicable
prospectus supplement. We may also sell hybrid or novel securities now existing
or developed in the future that combine certain features of debt securities and
other securities described in this prospectus.
The debt securities will be either senior debt securities or subordinated
debt securities. We will issue the "senior securities" under the "senior
indenture" dated May 1, 1995 between us and Bank One Trust Company, N.A., or
any successor trustee. We will issue the "subordinated securities" under a
"subordinated indenture" between us and the trustee named therein, or any
successor trustee. The senior indenture and the subordinated indenture are
collectively referred to in this prospectus as the "indentures," and each of
the trustee under the senior indenture and the trustee under the subordinated
indenture are referred to in this prospectus as a "trustee." The indentures are
included as exhibits to our registration statement and the following
description is qualified in its entirety by reference to the provisions of the
indentures and the applicable prospectus supplement. You should read these
documents carefully to fully understand the terms of the debt securities.
The numerical references in parentheses below are to sections of the
indentures. Unless otherwise indicated, capitalized terms used in the following
summary that are defined in the indentures have the meanings used in the
indentures. As used in this "Description of Debt Securities," the "company"
refers to Motorola, Inc. and does not, unless the context otherwise indicates,
include our subsidiaries.
General
The senior securities are unsubordinated obligations of the company. They
will be unsecured and will rank equally with each other and all of our other
unsubordinated debt, unless otherwise indicated in the applicable prospectus
supplement. (section 301 of the senior indenture.) Each applicable prospectus
supplement will set forth, as of the most recent practicable date, the
aggregate amount of outstanding debt that would rank junior to the senior
securities. The subordinated securities are subordinated in right of payment to
the prior payment in full of our senior indebtedness. See "--Subordinated
Indenture Provisions" below. The subordinated securities will be unsecured and
will rank equally with each other, unless otherwise indicated in the applicable
prospectus supplement. (section 301 of the subordinated indenture.) We will set
forth in each applicable prospectus supplement, as of the most recent
practicable date, the aggregate amount of our outstanding debt that would rank
senior to the subordinated securities. The indentures do not limit the
aggregate principal amount of debt securities that we may issue thereunder and
provide that we may issue debt securities thereunder from time to time in one
or more series.
Terms
We will prepare a prospectus supplement for each series of debt securities
that we issue. Each prospectus supplement will set forth the applicable terms
of the debt securities to which it relates, which may include the following:
. the title of the securities;
. any limit on the aggregate principal amount of the securities;
. the maturity;
. the interest rate or method of calculation of the interest rate and the
date from which interest will accrue;
. the interest payment dates and the record dates for payment of interest,
or the discount to face value and accretion rate in the case of debt
securities issued at a substantial discount to the principal amount;
. the price and date of any optional redemption by us;
5
. our obligation, if any, to redeem the offered securities and any
requirement to maintain a "sinking fund" to support such obligation;
. the terms of any repurchase or remarketing rights of third parties;
. the currency or currencies in which we will pay principal or interest;
. any conversion features; and
. whether the defeasance or covenant defeasance provisions of the
applicable indenture apply.
We can also establish any other terms and conditions of the debt securities
to the extent they do not conflict with the terms of the indentures. (section
301 of each indenture.) Therefore, you must read the applicable indenture and
prospectus supplement carefully to understand the terms of any series of debt
securities.
Effective Subordination
The debt securities will be our obligations exclusively. Since our
operations are partially conducted through subsidiaries, primarily overseas,
our cash flow and therefore our ability to service debt, including the debt
securities offered by the applicable prospectus supplement, are partially
dependent upon the earnings of our subsidiaries and the distribution of those
earnings to, or upon loans or other payments of funds by those subsidiaries to,
us. Our subsidiaries are separate and distinct legal entities and have no
obligation to pay any amounts due pursuant to the debt securities or to make
any funds available to us to repay our obligations, whether by dividends, loans
or other payments. In addition, the payment of dividends and the making of
loans and advances to us by our subsidiaries may be subject to statutory or
contractual restrictions, are contingent upon the earnings of those
subsidiaries and are subject to various business considerations.
Any right of ours to receive assets of any of our subsidiaries upon their
liquidation or reorganization and therefore the right of the holders of the
debt securities to participate in those assets will be effectively subordinated
to the claims of that subsidiary's creditors, including trade creditors.
No Limitations on Other Debt
The general provisions of the indentures do not contain any provisions that
would limit our ability to incur indebtedness or that would afford holders of
debt securities protection in the event of a highly leveraged or similar
transaction involving us. However, the indentures do restrict us and our
domestic subsidiaries from granting certain security interests on certain of
their property or assets unless the debt securities are equally secured. See
"--Restrictive Covenants" below.
Open-Ended Indenture
The indentures are "open-ended," meaning we may issue a number of different
series of debt securities, with different terms and conditions, under each of
the indentures. (section 301 of each indenture.) There is no limit on the
amount of debt securities we can issue under either indenture, and we already
have issued a significant amount of debt securities under the senior indenture.
Defeasance and Covenant Defeasance
Under the indentures, we have the ability to take certain steps to effect a
"defeasance" or a "covenant defeasance." A defeasance allows us to be
discharged from any and all obligations in respect of a series of debt
securities except for certain obligations to register the transfer or exchange
of such debt securities, to replace temporary, destroyed, stolen, lost or
mutilated debt securities, to maintain paying agencies and to hold monies for
payment in trust. A covenant defeasance allows us to stop complying with
certain restrictive covenants relating to:
. consolidation, merger, conveyance, transfer or lease;
6
. maintenance of our existence and properties;
. payment of taxes and other claims; and
. restrictions on secured debt and sale and leaseback transactions.
A covenant defeasance also causes certain events specified in the indentures
to no longer be deemed an event of default under the indentures.
To effect a defeasance or a covenant defeasance, we must deposit with the
applicable trustee an amount of money or U.S. government securities that,
through the payment of interest and principal in respect thereof in accordance
with their terms, will provide money in an amount sufficient to pay the
principal of, and premium, if any, and each installment of interest, if any, on
the debt securities of such series at the time such payments are due. We will
remain liable for any shortfall between the amount deposited with the trustee
and the amount due holders of debt securities upon any acceleration of payment.
We may only effect a defeasance or a covenant defeasance if we have provided
a legal opinion that such action will not cause holders of our debt securities
to recognize income, gain or loss for federal income tax purposes as a result
and that holders will be subject to federal income tax on the same amount and
in the same manner and at the same times as would have been the case if such
deposit and defeasance had not occurred. The opinion, in the case of a
defeasance, must refer to and be based upon a ruling of the Internal Revenue
Service or a change in applicable Federal income tax law occurring after the
date of the applicable indenture.
We may further describe in the applicable prospectus supplement the
provisions, if any, regarding defeasance or covenant defeasance with respect to
the debt securities of a particular series. (article fifteen of each
indenture.)
Restrictive Covenants
Restrictions on Secured Debt
If we or any Domestic Subsidiary incurs or guarantees any Debt secured by a
Mortgage on any Principal Property or on any shares of stock or Debt of any
Domestic Subsidiary, we must secure the debt securities of each series equally
and ratably with (or prior to) such secured Debt, unless, after giving effect
to such transaction, the aggregate amount of all such Debt so secured, together
with all Attributable Debt in respect of sale and leaseback transactions
involving Principal Properties, would not exceed 5% of the Consolidated Net
Tangible Assets of us and our consolidated subsidiaries. See "--Restrictive
Covenants--Restrictions on Sales and Leasebacks" below.
This restriction does not apply to, and there will be excluded from secured
Debt in any computation under such restriction, Debt secured by:
. Mortgages on property of, or on any shares of stock of or Debt of, any
corporation existing at the time such corporation becomes a Domestic
Subsidiary or at the time it is merged into or consolidated with us or a
Domestic Subsidiary;
. Mortgages in favor of us or a Domestic Subsidiary;
. Mortgages in favor of governmental bodies to secure progress or advance
payments;
. Mortgages on property, shares of stock or Debt existing at the time of
acquisition thereof, including acquisition through merger or
consolidation;
. purchase money Mortgages and Mortgages to secure the construction cost
of property; and
. any extension, renewal or refunding of any Mortgage referred to above.
7
Restrictions on Sales and Leasebacks
Neither we nor any Domestic Subsidiary may enter into any sale and leaseback
transaction involving any Principal Property, completion of construction and
commencement of full operation of which has occurred more than 180 days prior
thereto, unless:
. we or such Domestic Subsidiary could mortgage such property as provided
for above under "--Restrictive Covenants--Restrictions on Secured Debt"
in an amount equal to the Attributable Debt with respect to the sale and
leaseback transaction without equally and ratably securing the debt
securities of each series; or
. within 120 days, we apply to the retirement of our Funded Debt an amount
not less than the greater of:
. the net proceeds of the sale of the Principal Property leased
pursuant to such arrangement; or
. the fair market value of the Principal Property so leased, subject
to credits for certain voluntary retirements of Funded Debt.
This restriction will not apply to any sale and leaseback transaction:
. between us and a Domestic Subsidiary or between Domestic Subsidiaries;
or
. involving the taking back of a lease for a period, including renewals,
of three years or less. (section 1011 of each indenture.)
Certain Definitions
The following are certain key definitions used in the descriptions above of
restrictions on secured debt and sales and leasebacks contained in the
indentures. These and other definitions are contained in the indentures. You
should read the applicable indenture to understand these restrictions fully.
"Attributable Debt" means the total net amount of rent required to be paid
during the remaining term of any lease, discounted at the rate per annum borne
by the senior securities of each series, compounded annually.
"Consolidated Net Tangible Assets" means the aggregate amount of assets,
less applicable reserves and other properly deductible items, after deducting
from that net amount:
. all current liabilities, excluding any constituting Funded Debt by
reason of their being renewable or extendable; and
. goodwill and other intangibles. (section 1010 of each indenture.)
"Domestic Subsidiary" means a Subsidiary of ours except a Subsidiary of ours
which neither transacts any substantial portion of its business nor regularly
maintains any substantial portion of its fixed assets within the United States,
or which is engaged primarily in financing our operations or our Subsidiaries,
or both, outside the United States.
"Principal Property" includes any single parcel of real estate, any
manufacturing plant or warehouse we own or lease or any Domestic Subsidiary
owns or leases which is located within the United States and the gross book
value, without deduction of any depreciation reserves, of which on the date as
of which the determination is being made exceeds 1% of Consolidated Net
Tangible Assets, other than any manufacturing plant or warehouse or a portion
of any manufacturing plant or warehouse:
. which is a pollution control or other facility financed by obligations
issued by a state or local government unit; or
. which, in the opinion of our board of directors, is not of material
importance to the total business conducted by us and our subsidiaries as
an entirety.
8
"Subsidiary" means a corporation, a majority of the outstanding voting stock
of which is owned, directly or indirectly, by us or by one or more of our other
Subsidiaries.
Events of Default
The following are events of default under the indentures with respect to any
debt securities:
. failure to pay principal of, or premium, if any, on any debt security of
that series when due;
. failure to pay any installment of interest on any debt security of that
series when due, continued for 30 days;
. failure to deposit any sinking fund payment, when due, in respect of any
debt security of that series;
. failure to perform any other covenant of ours in the applicable
indenture, other than a covenant included in the applicable indenture
solely for the benefit of any series of debt securities other than that
series, continued for 60 days after written notice as provided in the
applicable indenture;
. certain events in bankruptcy, insolvency or reorganization; and
. any other event of default provided with respect to debt securities of
that series. (section 501 of each indenture.)
If an event of default with respect to the outstanding debt securities of
any series occurs and continues either the trustee or the holders of at least
25% in principal amount of the outstanding debt securities of that series may
declare the principal amount of all debt securities of that series to be due
and payable immediately; provided that in the case of certain events of
bankruptcy, insolvency or reorganization, such principal amount, or portion
thereof, will automatically become due and payable. However, at any time after
an acceleration with respect to debt securities of any series has occurred, but
before a judgment or decree based on such acceleration has been obtained, the
holders of a majority in principal amount of the outstanding debt securities of
that series may, under certain circumstances, rescind and annul such
acceleration. (section 502 of each indenture.) For information as to waiver of
defaults, see "--Modification and Waiver." You must read the applicable
prospectus supplement for a description of the acceleration provisions of any
debt securities issued as original issue discount or indexed securities.
Subject to the duty of the trustee during default to act with the required
standard of care, the trustee will be under no obligation to exercise any of
its rights or powers under the applicable indenture at the request or direction
of any of the holders, unless such holders have offered the trustee reasonable
security or indemnity. (section 603 of each indenture.) Subject to such
indemnification and certain other limitations, the holders of a majority in
principal amount of the outstanding debt securities of any series will 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 debt securities of that series. (section 512
of the senior indenture and section 505 of the subordinated indenture.)
We will be required to furnish to the trustee an annual statement as to our
performance of certain of our obligations under the applicable indenture and as
to any default in such performance. (section 1006 of each indenture.)
Modification and Waiver
Modifications and amendments of each indenture may be made by us and the
trustee with the consent of the holders of 66 2/3% in principal amount of the
outstanding debt securities of each series affected thereby, except that no
such modification or amendment may, without the consent of the holder of each
outstanding debt security affected thereby:
. change the stated maturity date of the principal of, or any installment
of principal of or interest on, any debt security;
9
. reduce the principal amount of, or premium, if any, or interest, if any,
on, any debt security;
. reduce the amount of principal of any original issue discount debt
security payable upon acceleration of the maturity thereof;
. change the place or currency of payment of principal of, or premium, if
any, or interest, if any, on, any debt security;
. impair the right to institute suit for the enforcement of any payment on
or with respect to any debt security; or
. reduce the percentage in principal amount of outstanding debt securities
of any series, the consent of the holders of which is required for
modification or amendment of the indenture or for waiver of compliance
with certain provisions of the applicable indenture or for waiver of
certain defaults. (section 902 of each indenture.)
The holders of a majority of the outstanding debt securities of any series
may on behalf of the holders of all debt securities of that series waive,
insofar as that series is concerned, our compliance with certain restrictive
provisions of the applicable indenture. (section 1012 of each indenture.) The
holders of a majority of the outstanding debt securities of any series may on
behalf of the holders of all debt securities of that series waive any past
default under the applicable indenture with respect to debt securities of that
series, except a default in the payment of the principal of, or premium, if
any, or interest, if any, on any debt security of that series or in respect of
any provision which under the applicable indenture cannot be modified or
amended without the consent of the holder of each outstanding debt security of
that series affected. (section 513 of the senior indenture and section 504 of
the subordinated indenture.)
In addition, we may not modify or amend the subordination provisions of the
subordinated indenture without the consent of the holders of each outstanding
subordinated debt security affected thereby. Further, no modification or
amendment of that type may adversely affect the rights under article sixteen of
the subordinated indenture of the holders of senior indebtedness then
outstanding without the consent of the requisite holders of senior indebtedness
required under the terms of such senior indebtedness. (section 902 of the
subordinated indenture.)
Each indenture contains provisions for convening meetings of the holders of
debt securities of a series issued thereunder if debt securities of that series
are issuable in whole or in part as bearer securities. (section 1401 of each
indenture.) The trustee for those debt securities may call a meeting at any
time or upon our request or the request of holders of at least 10% in principal
amount of the outstanding debt securities of such series, in any such case upon
notice given in accordance with the applicable indenture. (section 1402 of each
indenture.) Except for any consent that must be given by each holder of a debt
security affected, and except as described below, any resolution presented at a
meeting or adjourned meeting at which a quorum is present may be adopted by the
affirmative vote of the holders of a majority in principal amount of the
outstanding debt securities of that series. Any resolution with respect to any
consent which may be given by the holders of not less than 66 2/3% in principal
amount of the outstanding debt securities of a series issued under an
indenture, except for any consent that must be given by each holder of a debt
security affected, may be adopted at a meeting or an adjourned meeting at which
a quorum is present only by the affirmative vote of the holders of 66 2/3% in
principal amount of such outstanding debt securities of that series. Further,
any resolution with respect to any demand, consent, waiver or other action
which may be made, given or taken by the holders of a specified percentage,
which is less than a majority, in principal amount of the outstanding debt
securities of a series issued under one of the indentures may be adopted at a
meeting or adjourned meeting at which a quorum is present by the affirmative
vote of the holders of such specified percentage in principal amount of the
outstanding debt securities of that series. (section 1404 of each indenture.)
Any resolution passed or decision taken at any meeting of holders of debt
securities of any series duly held in accordance with the applicable indenture
with respect thereto will be binding on all holders of debt securities of that
series and the related coupons issued under that indenture. The quorum at any
meeting of
10
holders of a series of debt securities called to adopt a resolution, and at any
reconvened meeting, will be persons holding or representing a majority in
principal amount of the outstanding debt securities of such series. However, if
any action is to be taken at such meeting with respect to a consent which may
be
given by the holders of not less than 66 2/3% in principal amount of the
outstanding debt securities of a series, the persons holding or representing 66
2/3% in principal amount of the outstanding debt securities of such series
issued under that indenture will constitute a quorum. (section 1404 of each
indenture.)
Consolidation, Merger, Conveyance, Transfer or Lease
We may, without the consent of any holders of outstanding debt securities,
consolidate or merge with or into, or transfer or lease its assets
substantially as an entirety to, any entity, and any other entity may
consolidate or merge with or into, or transfer or lease our assets
substantially as an entirety to, us, provided that:
. the entity other than us formed by such consolidation or into which we
are merged or which acquires or leases our assets is organized and
existing under the laws of any United States jurisdiction and assumes
our obligations on the debt securities and under the applicable
indenture;
. after giving effect to the transaction, no event of default, and no
event which, after notice or lapse of time or both, would become an
event of default, has happened and is continuing, provided that a
transaction will only be deemed to be in violation of this condition as
to any series of debt securities as to which such event of default or
such event has happened and is continuing; and
. certain other conditions are met. (article eight of each indenture.)
Form, Denominations, Exchange, Registration and Transfer
We may issue debt securities as registered securities or bearer securities,
and may be issued in global form. Global securities are described below under
"--Global Securities." Unless we otherwise provide in the applicable prospectus
supplement, we will issue registered securities in denominations of $1,000 and
integral multiples thereof and we will issue bearer securities in denominations
of $5,000 and integral multiples thereof. Unless we otherwise indicate in the
applicable prospectus supplement, bearer securities will have interest coupons
attached. (section 201 of each indenture.)
Our registered securities will be exchangeable for other registered
securities of the same series. In addition, if we issue a series of debt
securities as both registered securities and bearer securities, subject to
certain conditions, holders may exchange bearer securities for registered
securities. Our registered securities generally may not be exchanged for bearer
securities unless we provide for such an exchange in the applicable prospectus
supplement. (section 305 of each indenture.)
We will not mail bearer securities in connection with their original
issuance to any location in the United States. In addition, the United States
Internal Revenue Code of 1986, as amended, requires us to obtain written
certification from the initial purchaser of a bearer security to the effect
that:
. the bearer security is not being acquired by or on behalf of a United
States person;
. if a beneficial interest in the bearer security is being acquired by or
on behalf of a United States person, that the United States person is a
foreign branch of a United States financial institution that is
purchasing for its own account or for resale or the person is acquiring
the bearer security through the foreign branch of a United States
financial institution and the financial institution agrees, in either
case, to comply with certain requirements of the Internal Revenue Code;
or
. the bearer security is being acquired by a United States or foreign
financial institution for resale during the restricted period and has
not been acquired for purposes of resale directly or indirectly to a
United States person or to a person within the United States or its
possessions. (section 303 of each indenture.)
You may present registered securities for registration of transfer at the
office of the trustee, or at the office of any transfer agent we designate
without service charge and upon payment of any taxes and other
11
governmental charges. (section 305 of each indenture.) We may change transfer
agents or designate additional transfer agents at any time, except that, if we
have issued a series of debt securities solely as registered securities, we
must maintain a transfer agent in each place of payment for such series and,
if we have issued a series of debt securities as bearer securities, we must
maintain a transfer agent in a place of payment for such series located
outside the United States. (section 1002 of each indenture.)
If we elect or are required to redeem or exchange particular debt
securities, we will not be required to:
. issue, register the transfer of or exchange those debt securities for a
period of 15 days before the first publication or mailing of the notice
of redemption or exchange;
. register the transfer of or exchange any registered security selected
for redemption; or
. exchange any bearer security selected for redemption except that a
bearer security selected for redemption may be exchanged for a
registered security that will be surrendered for redemption. (section
305 of each indenture.)
Global Securities
The following will apply to debt securities of any series, unless the
prospectus supplement relating to that series provides otherwise.
Upon issuance, we will deposit with, or on behalf of, the depositary and
will register in the name of the depositary or a nominee of the depositary one
or more "global securities" to represent the debt securities of each series.
Unless we otherwise indicate in the prospectus supplement relating to a series
of debt securities, The Depository Trust Company will act as the depositary
and we will deposit the global securities with, or on behalf of, DTC or its
nominee, and we will register registered securities in the name of a nominee
of DTC. Except under limited circumstances described below, global securities
will not be exchangeable for definitive certificated debt securities.
Upon the issuance of a global security, DTC will credit on its book-entry
registration and transfer system the principal amounts of the individual debt
securities represented by such global security to the accounts of persons that
have accounts with DTC, generally known as DTC participants. Ownership of
beneficial interests in a global security will be limited to DTC participants
or persons that may hold interests through DTC participants. Ownership of
beneficial interests in such global security will be shown on, and the
transfer of that ownership will be effected only through, records maintained
by DTC with respect to interests of DTC participants and records of DTC
participants, with respect to interests of persons who hold through DTC
participants. The laws of some states require that certain purchasers of
securities take physical delivery of such securities in definitive form. Such
limits and such laws may impair the ability to own, pledge or transfer
beneficial interest in a global security.
So long as the depositary is the registered owner of a global security, the
depositary will be considered the sole owner or holder of the debt securities
represented by such global security for all purposes under the applicable
indenture. Except as provided below, owners of beneficial interests in a
global security will not be entitled to have any of the individual debt
securities registered in their names, will not receive or be entitled to
receive physical delivery of any such debt securities in definitive form and
will not be considered the owners or holders thereof under the applicable
Indenture.
We will make payments of principal of and any interest, and premium, if
any, on individual debt securities represented by a global security to DTC or
its nominee, as the case may be, as the sole registered owner of such global
security and the sole holder of the debt securities represented by the global
security for all purposes under the applicable indenture. Neither we nor the
trustee, nor any of our agents or the trustee, will have any responsibility or
liability for any aspect of DTC's records relating to or payments made on
account of beneficial ownership interests in the global securities
representing any debt securities or for maintaining, supervising or reviewing
any of DTC's records relating to those beneficial ownership interests.
We have been advised by DTC that, upon receipt of any payment in respect of
a global security, DTC will immediately credit DTC participants' accounts for
their pro rata share of such payments. We also expect that
12
payments by DTC participants to owners of beneficial interests in global
securities held through such DTC participants will be governed by standing
instructions and customary practices, as is now the case with securities held
for the accounts of customers in bearer form or registered in "street name."
These payments will be the sole responsibility of the DTC participants.
Global securities may not be transferred except as a whole by DTC to a
nominee of DTC. Global securities representing debt securities are
exchangeable for certificated debt securities only if:
. DTC or its nominee notifies us that it is unwilling or unable to
continue as depositary for these global securities;
. DTC ceases to be qualified as required by the applicable indenture;
. we instruct the trustee in accordance with the applicable indenture that
those global securities will be so exchangeable; or
. there shall have occurred and be continuing an event of default or an
event which after notice or lapse of time would be an event of default
with respect to the debt securities represented by such global security.
Any global securities that are exchangeable as described above shall be
exchangeable for certificated debt securities issuable in denominations of
$1,000, or $5,000 in the case of bearer debt securities, and integral
multiples of $1,000, or $5,000 in the case of bearer debt securities, in
excess thereof and registered in the names DTC directs. Subject to the
foregoing, global securities are not exchangeable, except for global
securities of like denomination to be registered in the name of DTC or its
nominee. If we issue debt securities subsequently in registered form, they
would thereafter be transferred or exchanged without any service charge at the
corporate trust office of the trustee or at any other office or agency we
maintain for such purpose.
So long as DTC or its nominee is the registered holder and owner of global
securities, DTC or its nominee, as the case may be, will be considered the
sole owner or holder of the debt securities represented by the global
securities for the purposes of receiving payment on the debt securities,
receiving notices and for all other purposes under the applicable indenture
and the debt securities. Except as provided above, owners of beneficial
interests in global securities will not be entitled to receive physical
delivery of debt securities in definitive form and will not be considered the
holders thereof for any purpose under the applicable indenture. Accordingly,
each person owning a beneficial interest in the global securities must rely on
the procedures of DTC and, if such person is not a DTC participant, on the
procedures of the DTC participant through which such person owns its interest,
to exercise any rights of a holder under the applicable indenture. The
indentures provide that DTC may grant proxies and otherwise authorize DTC
participants to give or take any request, demand, authorization, direction,
notice, consent, waiver or other action which a holder is entitled to give or
take under the applicable indenture. We understand that under existing
industry practices in the event that we request any action of holders or that
an owner of a beneficial interest in global securities desires to give or take
any action which a holder is entitled to give or take under the applicable
indenture, DTC would authorize the DTC participants holding the relevant
beneficial interests to give or take such action, and such DTC participants
would authorize beneficial owners owning through such DTC participants to give
or take such action or would otherwise act upon the instructions of beneficial
owners through them.
DTC has advised us as follows:
. DTC 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, as amended.
13
. DTC holds securities that DTC participants deposit with DTC.
. DTC also facilitates the settlement among DTC participants of securities
transactions, such as transfers and pledges in deposited securities
through electronic computerized book-entry changes in DTC participants'
accounts, thereby eliminating the need for physical movement of
securities certificates.
. Direct DTC participants include securities brokers and dealers, banks,
trust companies, clearing corporations and certain other organizations.
DTC is owned by a number of direct DTC participants and by the New York
Stock Exchange, Inc., the American Stock Exchange, Inc. and the National
Association of Securities Dealers, Inc.
. Access to DTC's system is also available to others, such as securities
brokers and dealers, banks and trust companies that clear through or
maintain a custodial relationship with a direct DTC participant, either
directly or indirectly.
. The rules applicable to DTC and DTC participants are on file with the
SEC.
According to DTC, the foregoing information with respect to DTC has been
provided to the industry for informational purposes only and is not intended to
serve as a representation, warranty or contract modification of any kind.
Payment and Paying Agents
Unless the applicable prospectus supplement provides otherwise, the place of
payment for all registered securities will be Chicago, Illinois, U.S.A., and we
will initially designate the corporate trust office of the applicable trustee
for this purpose. At our option, we may pay interest, if any, on registered
securities by check mailed to the address of the person entitled thereto as
such person's address appears in the security register or by wire transfer to
an account located in the United States maintained by the person entitled
thereto as specified in the security register. (sections 307, 1001 and 1002 of
each indenture.) Unless the applicable prospectus supplement provides
otherwise, we will make payment of any installment of interest on registered
securities to the person in whose name such registered security is registered
at the close of business on the record date for such interest. (section 307 of
each indenture.)
If we issue bearer securities, we must maintain an office or agency outside
the United States at which the principal of, and premium, if any, and interest,
if any, on the bearer securities will be paid. (section 1002 of each
indenture.) The initial locations of such offices and agencies will be
specified in the applicable prospectus supplement. Unless the applicable
prospectus supplement provides otherwise, we will make payments with respect to
bearer securities, at the holder's option, by check in the currency designated
in the bearer security presented or mailed to an address outside the United
States or paid by wire transfer to an account in such currency maintained at a
bank located outside the United States. We will not make payments in the United
States. (sections 307 and 1002 of each indenture.) Nevertheless, we will make
payments with respect to bearer securities payable in U.S. dollars at the
office of our paying agent in Chicago, Illinois if, but only if, payment
outside the United States is illegal or effectively precluded by exchange
controls or other similar restrictions and the trustee has received an opinion
of counsel that such payment within the United States is legal. (sections 307
and 1002 of each indenture.) Unless the applicable prospectus supplement
provides otherwise, we will make payment of installments of interest on any
bearer securities on or before maturity only against surrender of coupons for
such interest installments as they mature. (section 1001 of each indenture.)
Unless the applicable prospectus supplement provides otherwise, we will make
all payments of principal of, and premium, if any, and interest, if any, on any
debt security that is payable in a currency other than U.S. dollars in U.S.
dollars if such currency:
. ceases to be used both by the government of the country that issued the
currency and by a central bank or other public institution of or within
the international banking community for the settlement of transactions;
. is the euro and ceases to be used both within the European Monetary
Union and for the settlement of transactions by public institutions of
or within the European Union; or
14
. is any currency unit, or composite currency, other than the euro and
ceases to be used for the purposes for which it was established.
(section 312 of each indenture.)
We may designate additional offices or agencies for payment with respect to
any debt securities, approve a change in the location of any such office or
agency and, except as provided above, rescind the designation of any such
office or agency.
All moneys deposited with a paying agent or held for the payment of
principal of, or premium, if any, or interest, if any, on any debt security
that remains unclaimed at the end of two years after such payment has become
due will, at our request, be repaid to us, or discharged from trust, and the
holder of such debt security may thereafter look only to us for payment
thereof. (section 1003 of each indenture.)
Subordinated Indenture Provisions
Our subordinated securities are subordinate and junior in right of payment,
to the extent set forth in the subordinated indenture, to the prior payment in
full of all existing and future senior debt of ours. (section 1601 of the
subordinated indenture.)
Senior debt is defined in the subordinated indenture as the principal of,
and premium, if any, and interest on, including interest accruing after the
filing of a petition initiating any proceeding pursuant to any bankruptcy law,
and other amounts due on or in connection with any debt incurred, assumed or
guaranteed by us, whether outstanding on the date of the subordinated indenture
or thereafter incurred, assumed or guaranteed, and all renewals, extensions and
refundings of any such debt. Excluded from the definition of senior debt are
the following:
. any debt which expressly provides:
. that such debt is not senior in right of payment to the subordinated
securities; or
. that such debt is subordinated to any other debt of ours, unless
such debt expressly provides that such debt is senior in right of
payment to the subordinated securities;
. debt of ours in respect of the subordinated securities;
. debt of ours in respect of our outstanding Liquid Yield Option(TM) Notes
due 2009 and our outstanding Liquid Yield Option(TM) Notes due 2013,
which 2009 LYONs and 2013 LYONs rank on a parity with the subordinated
securities;
. debt of ours in respect of the extension notes which may be issued in
the future, at specified dates, in respect of the 2009 LYONs and in
payment of the purchase price thereof, which extension notes would rank
on a parity with the subordinated securities and any 2009 LYONs and 2013
LYONs remaining outstanding (section 101 of the subordinated indenture);
and
. debt of ours in respect of our 6.68% deferrable interest junior
subordinated debentures due March 31, 2039 representing a long-term loan
made to us by Motorola Capital Trust I, a Delaware statutory business
trust and our wholly-owned subsidiary, and our obligations related to
our guarantee of certain obligations of the trust under its 6.68% Trust
Originated Preferred SecuritiesSM.
There are no restrictions in the subordinated indenture on the creation of
additional senior debt, or any other indebtedness. (section 101 of the
subordinated indenture.) The prospectus supplement with respect to any
subordinated securities will set forth:
. the aggregate amount of consolidated indebtedness outstanding as of the
most recent practicable date that would constitute either senior debt or
indebtedness of our subsidiaries;
. the aggregate amount of outstanding indebtedness as of the most recent
practicable date that would rank on a parity with the subordinated
securities; and
. any then-existing limitation on the issuance of additional senior debt.
--------
(TM)Trademark of Merrill Lynch & Co.
SM"Trust Originated Preferred Securities" and "TOPrS" are service marks of
Merrill Lynch & Co.
15
By reason of such subordination, in the event of dissolution, insolvency,
bankruptcy or other similar proceedings, upon any distribution of assets:
. the holders of all senior debt will first be entitled to receive payment
in full of all amounts due or to become due thereon, or payment of such
amounts shall have been provided for, before the holders of subordinated
securities would be entitled to receive any payment or distribution with
respect to such securities;
. the holders of subordinated securities will be required to pay over
their share of such distribution to the holders of senior debt until
such senior debt is paid in full; and
. our creditors who are not holders of subordinated securities or holders
of senior debt may recover less, ratably, than holders of senior debt
and may recover more, ratably, than the holders of subordinated
securities. (section 1602 of the subordinated indenture.)
Unless the applicable prospectus supplement provides otherwise, in the event
that the subordinated securities are declared due and payable prior to their
Stated Maturity by reason of the occurrence of an event of default, then we
would be obligated to promptly notify holders of senior debt of such
acceleration. Unless the applicable prospectus supplement provides otherwise,
we may not pay the subordinated securities until 120 days have passed after
such acceleration occurs and may thereafter pay the subordinated securities if
the terms of the subordinated indenture otherwise permit payment at that time.
(section 1603 of the subordinated indenture.)
Unless the applicable prospectus supplement provides otherwise, we may not
make any payment of the principal, and premium, if any, or interest, if any,
with respect to any of the subordinated securities, except we may acquire
subordinated securities for our common stock or other capital stock or as
otherwise set forth in the subordinated indenture, if any default with respect
to senior debt occurs and is continuing that permits the acceleration of the
maturity thereof and such default is either the subject of judicial proceedings
or we receive notice of the default, unless 120 days pass after notice of the
default is given and such default is not then the subject of judicial
proceedings or the default with respect to the senior debt is cured or the
terms of the subordinated indenture otherwise permit the payment or acquisition
of the subordinated securities at that time. (section 1604 of the subordinated
indenture.)
The Trustee
Bank One Trust Company, N.A. is trustee under:
. the senior indenture relating to:
. our 6.75% notes due February 1, 2006;
. our 5.80% notes due October 15, 2008;
. our 7 5/8% notes due November 15, 2010;
. our Puttable Reset Securities PURSSM due February 1, 2011;
. our 7 1/2% debentures due May 15, 2025;
. our 6 1/2% debentures due September 1, 2025;
. our 6 1/2% debentures due November 15, 2028;
. our 5.22% debentures due October 1, 2097;
. the indenture dated as of September 1, 1989 relating to our 2009 LYONs;
and
. the indenture dated as of September 1, 1993 relating to our 2013 LYONs.
We maintain various banking relationships with Bank One, N.A., an affiliate
of the trustee. As one of our principal commercial banks, Bank One, N.A.
provides several foreign exchange and cash management services to us and has
extended several credit facilities to us. Bank One, N.A. is also an issuing and
paying agent for various commercial paper we have issued.
--------
SM Service Mark of Goldman, Sachs & Co.
16
DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock is subject to the detailed
provisions of our restated certificate of incorporation, as amended, and
bylaws, as amended, and to the rights agreement described below. This
description does not purport to be complete and is qualified in its entirety by
reference to the terms of the certificate of incorporation, the bylaws and the
rights agreement, which are filed as exhibits to the registration statement.
See "Where You Can Find More Information."
Common and Preferred Stock
Our authorized capital stock consists of 4,200,000,000 shares of common
stock, par value $3 per share, and 500,000 shares of preferred stock, par value
$100 per share, issuable in series. There are no shares of preferred stock
presently outstanding. Our board of directors is authorized to create and issue
one or more series of preferred stock and to determine the rights and
preferences of each series, to the extent permitted by our certificate of
incorporation. The holders of shares of our common stock are entitled to one
vote for each share held and each share of our common stock is entitled to
participate equally in dividends out of funds legally available therefor, as
and when declared by our board of directors, and in the distribution of assets
in the event of liquidation. The shares of our common stock have no preemptive
or conversion rights, redemption provisions or sinking fund provisions. The
outstanding shares of our common stock are duly and validly issued, fully paid
and nonassessable, and any shares of our common stock issued in an offering
pursuant to this prospectus and any shares of common stock issuable upon the
exercise of common stock warrants or conversion or exchange of debt securities
which are convertible into or exchangeable for our common stock, or in
connection with the obligations of a holder of stock purchase contracts to
purchase our common stock, will be duly and validly issued, fully paid and
nonassessable.
Preferred Stock Purchase Rights
On November 5, 1998, we authorized a new rights agreement between us and
Harris Trust and Savings Bank, as rights agent to replace the existing rights
agreement dated as of November 9, 1988, as amended, and the associated rights,
which expired as of the close of business on November 20, 1998. The following
summary of certain provisions of the rights agreement does not purport to be
complete and is qualified in its entirety by reference to all of the provisions
of the rights agreement, including particular provisions or defined terms of
the rights agreement. See "Where You Can Find More Information."
Under the rights agreement, each outstanding share of our common stock is
accompanied by a preferred stock purchase right. Each right entitles the
registered holder to purchase from us one thirty-thousandth of a share, as
adjusted to reflect our 3-for-1 stock split in the form of a 200% stock
dividend paid on June 1, 2000, of our Junior Participating Preferred Stock,
Series B, $100 par value per share, at a price of $66.66 per one thirty-
thousandth, or $200 per one ten-thousandth, of a preferred share, subject to
adjustment. The rights attach to shares of our common stock outstanding as of
the close of business on November 20, 1998 and to shares of our common stock
which become outstanding thereafter prior to the earliest of the distribution
date, the redemption of the rights, the exchange of the rights and the
expiration of the rights, and, in certain cases, following the distribution
date.
The rights have certain anti-takeover effects. The rights may cause
substantial dilution to a person or group that attempts to acquire us on terms
not approved by the board of directors, except pursuant to an offer conditioned
on a substantial number of rights being acquired. The rights should not
interfere with any merger or other business combination approved by our board
of directors because of the ability of our board of directors to redeem the
rights.
Until the earlier to occur of 10 days following a public announcement that a
person or group of affiliated or associated persons (referred to herein as an
"acquiring person") acquired, or obtained the right to acquire, beneficial
ownership of 10% or more of the outstanding shares of our common stock and 10
days following the commencement or announcement of a tender offer or exchange
offer for 10% or more of such outstanding
17
shares of our common stock (the earlier of such dates being called the
"distribution date"), the rights will be evidenced, with respect to any of our
common stock certificates outstanding as of November 20, 1998, by such common
stock certificate. The rights agreement provides that, until the distribution
date, the rights will be transferred with and only with the shares of our
common stock. Until the distribution date, or earlier redemption or expiration
of the rights, new common stock certificates issued after November 20, 1998,
upon the transfer or new issuance of shares of common stock, including, unless
the applicable prospectus supplement provides otherwise, the shares of common
stock issued:
. in an offering pursuant to this prospectus;
. upon exercise of any common stock warrants;
. upon conversion or exchange of debt securities which are convertible
into or exchangeable for common stock; or
. in connection with the obligations of a holder of stock purchase
contracts to purchase common stock;
will contain a notation incorporating the rights agreement by reference.
Until the distribution date, or earlier redemption or expiration of the
rights, the surrender for transfer of any certificate for shares of our common
stock, outstanding as of November 20, 1998, with or without such notation or a
copy of a summary of rights being attached thereto, will also constitute the
transfer of the rights associated with the shares of our common stock
represented by such certificate. As soon as practicable following the
distribution date, we will mail separate certificates evidencing the rights to
holders of record of the common stock as of the close of business on the
distribution date and such separate right certificates alone will evidence the
rights.
The rights are not exercisable until the distribution date. The rights will
expire on November 20, 2008, unless we earlier redeemed them as described
below.
The preferred share purchase price payable, and the number of preferred
shares or other securities, cash or other property issuable, upon exercise of
the rights are subject to adjustment from time to time to prevent dilution:
. in the event of a stock dividend on, or a subdivision, combination or
reclassification of, the common stock;
. upon the grant to holders of our common stock of certain rights or
warrants to subscribe for common stock or convertible securities at less
than the current market price of our common stock;
. upon the distribution to holders of our common stock of evidences of
indebtedness or assets, excluding regular periodic cash dividends; and
. in connection with any recapitalization of us.
In the event that a person becomes an acquiring person, each right, other
than rights that are or were beneficially owned by the acquiring person and
certain related persons and transferees, which will thereafter be void, shall
thereafter be exercisable not for our preferred shares, but for a number of
shares of our common stock, or, in certain cases, fractional shares of our
preferred stock, other common stock equivalents or cash, having a market value
of two times the exercise price of the right. In the event that, at the time or
after a person becomes an acquiring person, we are involved in a merger or
other business combination in which:
. we are not the surviving corporation;
. our common stock is changed or exchanged; or
. 50% or more of our consolidated assets or earning power are sold;
then each right, other than rights that are or were owned by the acquiring
person and certain related persons and transferees, which will thereafter be
void, shall thereafter be exercisable for a number of shares of common stock of
the acquiring company having a market value of two times the exercise price of
the right.
18
In addition, at any time after a triggering event and before a person has
acquired beneficial ownership of 50% or more of our outstanding common stock,
we may elect to exchange all or part of the rights, excluding void rights held
by an acquiring person and certain related persons and transferees, at an
exchange ratio of one share of our common stock, or one thirty-thousandth,
subject to adjustment, of a preferred share, or other common stock equivalent,
per right.
At any time prior to a triggering event, our board of directors may redeem
the rights in whole, but not in part, at a price of $.0033 per right, as
adjusted to reflect our 3-for-1 stock split in the form of a 200% stock
dividend paid on June 1, 2000. Immediately upon the action of our board of
directors ordering redemption of the rights, the right to exercise the rights
will terminate and the only right of the holders of rights will be to receive
the rights redemption amount.
Until a right is exercised, the holder thereof, as such, will have no rights
as one of our stockholders, including, without limitation, the right to vote or
to receive dividends.
At any time prior to a triggering event, we may amend or supplement the
rights agreement without the approval of the rights agent or any holder of the
rights. Thereafter, no amendment may adversely affect the interests of the
rights holders, other than an acquiring person.
The preferred shares purchasable upon exercise of the rights will not be
redeemable. Each preferred share will be entitled to a minimum preferential
quarterly dividend payment equal to the greater of $250 per share and 30,000
times the dividend declared per share of our common stock. In the event of
liquidation, the holders of our preferred shares will be entitled to a minimum
preferential liquidation payment equal to the greater of $1,000 per share and
30,000 times the payment made per share of our common stock. Each preferred
share will have 30,000 votes per share, voting together with the common stock.
In the event of any merger, consolidation or other transaction in which our
common stock is exchanged, each preferred share will be entitled to receive
30,000 times the amount received per share of our common stock.
Because of the nature of the preferred shares' dividend, liquidation and
voting rights, the value of the one thirty-thousandth interest in a preferred
share that may be purchased upon exercise of each right should approximate the
value of one share of our common stock.
No fractional shares of common stock or preferred shares will be required to
be issued upon the exercise of a right, other than fractions of preferred
shares that are integral multiples of one thirty-thousandth of a preferred
share, which may, at our election, be evidenced by depositary receipts, and in
lieu thereof, an adjustment in cash will be made based on the market price of
our common stock or preferred shares on the last trading day prior to the date
of exercise.
19
DESCRIPTION OF SECURITIES WARRANTS
We may issue warrants for the purchase of our debt securities or common
stock, either independently or together with debt securities. We will issue
each series of warrants under a separate warrant agreement between us and a
bank or trust company, as agent. The warrant agent will act solely as our agent
and will not assume any obligation for any warrant holders. Copies of the forms
of warrant agreements and the forms of warrant certificates are filed as
exhibits to the registration statement. The following description of certain
provisions of the forms of warrant agreements and warrant certificates does not
purport to be complete and is qualified in its entirety by reference to all the
provisions of the warrant agreements and the warrant certificates.
General
If we offer warrants for the purchase of debt securities, the applicable
prospectus supplement will describe their terms, which may include the
following:
. the title and aggregate number of the warrants;
. the title, rank, aggregate principal amount, denomination, and terms of
the underlying debt securities;
. the currency of the underlying debt securities or of payment of the
exercise price;
. whether the warrants are issued as a unit with a debt security, and if
so, the number of warrants attached to each such debt security;
. the date, if any, on and after which such warrants and any related
securities will be transferable separately;
. the principal amount of the debt securities purchasable upon exercise of
each warrant and the price, or the manner of determining the price, at
which such debt securities may be purchased upon exercise;
. when the warrants may be exercised and the expiration date;
. whether the warrant certificates will be issued in registered or bearer
form;
. United States federal income tax consequences;
. the terms of any right of ours to redeem or accelerate the
exercisability of such warrants;
. whether the warrants are to be issued with any other securities;
. the offering price; and
. any other terms of the warrants.
If we offer warrants for the purchase of our common stock, the applicable
prospectus supplement will describe their terms, which may include the
following:
. the title and aggregate number of the warrants and whether the warrants
will be sold with other securities;
. the number of shares of common stock that may be purchased on exercise
of each warrant;
. the price or manner of determining the price, the manner in which the
exercise price may be paid and any minimum number of warrants
exercisable at one time;
. the terms of any right of ours to redeem the warrants;
. the date, if any, on and after which the warrants and any related series
of debt securities will be transferable separately;
20
. when the warrants may be exercisable and the expiration date;
. the terms of any right of ours to accelerate the exercisability of the
warrants;
. United States federal income tax consequences; and
. any other terms of the warrants.
Warrants for the purchase of our common stock will be offered and
exercisable for U.S. dollars only.
Warrants may be exchanged for new warrants of different denominations, may,
if in registered form, be presented for registration of transfer and may be
exercised at the corporate trust office of the warrant agent or any other
office indicated in the applicable prospectus supplement. No service charge
will be made for any permitted transfer or exchange of warrant certificates,
but holders must pay any tax or other applicable governmental charge. Prior to
the exercise of any warrant to purchase underlying debt securities, holders of
such warrants will not have any of the rights of holders of the debt securities
purchasable upon such exercise, including the right to receive payments of
principal of, or premium, if any, or interest, if any, on the debt securities
purchasable upon such exercise or to enforce covenants in the applicable
indenture. Prior to the exercise of any warrants to purchase our common stock,
holders of such warrants will not have any rights of holders of our common
stock purchasable upon such exercise, including the right to receive payments
of dividends, if any, on our common stock purchasable upon such exercise or to
exercise any applicable right to vote.
Exercise of Warrants
Each warrant will entitle the holder to purchase underlying debt securities
or our common stock, as the case may be, at the exercise price described in, or
calculable from, the applicable prospectus supplement. Unexercised warrants
will become void after the close of business on the expiration date.
Holders can exercise warrants by delivering the exercise price and certain
required information to the warrant agent. Warrants will be deemed to have been
exercised upon receipt of payment of the exercise price, subject to the
receipt, within five business days, of the warrant certificate. Upon receipt of
such payment and such warrant certificate properly completed and duly executed
at the corporate trust office of the warrant agent or any other office
indicated in the applicable prospectus supplement, we will, as soon as
practicable, issue and deliver the underlying debt securities or our common
stock, as the case may be, purchasable upon such exercise. If fewer than all of
the warrants represented by a warrant certificate are exercised, we will issue
a new warrant certificate for the remaining warrants. The holder of a warrant
must pay any tax or other governmental charge imposed in connection with the
issuance of underlying debt securities or our common stock purchased upon
exercise of a warrant.
Modifications
The warrant agreements and the terms of the warrants may be modified or
amended by us and the warrant agent, without the consent of any holder, for the
purpose of curing any ambiguity, or of curing, correcting or supplementing any
defective or inconsistent provision contained therein, or in any other manner
that we deem necessary or desirable and that will not materially adversely
affect the interests of the holders of the warrants.
Together with the warrant agent, we may also modify or amend the warrant
agreement and the terms of the warrants with the consent of a majority of the
holders of the then outstanding unexercised warrants affected thereby. No
modification or amendment of that type that accelerates the expiration date,
increases the exercise price, reduces the number of outstanding warrants
required for consent of any such modification or amendment, or otherwise
materially adversely affects the rights of the holders of the warrants, may be
made without the consent of each holder affected thereby.
21
Common Stock Warrant Adjustments
The terms and conditions on which the exercise price of and/or the number of
shares of our common stock covered by a warrant are subject to adjustment will
be set forth in the warrant certificate and the applicable prospectus
supplement. Such terms will include:
. provisions for adjusting the exercise price and/or the number of shares
of our common stock covered by the warrant;
. the events requiring an adjustment;
. the events upon which we may, in lieu of making an adjustment, make
proper provisions so that the holder of the warrant, upon its exercise,
would be treated as if the holder had exercised the warrant prior to the
occurrence of the events; and
. provisions affecting exercise in the event of certain events affecting
our common stock.
DESCRIPTION OF THE STOCK PURCHASE CONTRACTS
AND THE STOCK PURCHASE UNITS
We may issue stock purchase contracts representing contracts obligating
holders to purchase from us, and us to sell to the holders, a specified number
of shares of our common stock (or a range of numbers of shares pursuant to a
predetermined formula) at a future date or dates. The price per share of common
stock and the number of shares of common stock may be fixed at the time the
stock purchase contracts are issued or may be determined by reference to a
specific formula set forth in the stock purchase contracts.
The stock purchase contracts may be issued separately or as a part of units,
often known as stock purchase units, consisting of a stock purchase contract
and either:
. our debt securities; or
. debt obligations of third parties, including U.S. Treasury securities;
securing the holders' obligations to purchase the common stock under the stock
purchase contracts.
The stock purchase contracts may require us to make periodic payments to the
holders of the stock purchase units or vice versa, and such payments may be
unsecured or prefunded on some basis. The stock purchase contracts may require
holders to secure their obligations in a specified manner and in certain
circumstances we may deliver newly issued prepaid stock purchase contracts,
often known as prepaid securities, upon release to a holder of any collateral
securing such holder's obligations under the original stock purchase contract.
The applicable prospectus supplement will describe the terms of any stock
purchase contracts or stock purchase units and, if applicable, prepaid
securities. The description in the applicable prospectus supplement will not
contain all of the information that you may find useful. For more information,
you should review the stock purchase contracts, the collateral arrangements and
depositary arrangements, if applicable, relating to such stock purchase
contracts or stock purchase units and, if applicable, the prepaid securities
and the document pursuant to which the prepaid securities will be issued. These
documents will be filed with the SEC promptly after the offering of the stock
purchase contracts or stock purchase units. Material United States federal
income tax considerations applicable to the stock purchase contracts and the
stock purchase units will also be discussed in the applicable prospectus
supplement.
22
PLAN OF DISTRIBUTION
We may sell the securities offered pursuant to this prospectus through
agents, through underwriters or dealers or directly to one or more purchasers.
Underwriters, dealers and agents that participate in the distribution of the
securities offered pursuant to this prospectus may be underwriters as defined
in the Securities Act of 1933 and any discounts or commissions received by them
from us and any profit on the resale of the offered securities by them may be
treated as underwriting discounts and commissions under the Securities Act. Any
underwriters or agents will be identified and their compensation, including
underwriting discount, will be described in the applicable prospectus
supplement. The prospectus supplement will also describe other terms of the
offering, including any discounts or concessions allowed or reallowed or paid
to dealers and any securities exchanges on which the offered securities may be
listed.
The distribution of the securities offered under this prospectus may occur
from time to time in one or more transactions at a fixed price or prices, which
may be changed, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at negotiated prices.
If the applicable prospectus supplement indicates, we will authorize dealers
or our agents to solicit offers by certain institutions to purchase offered
securities from us pursuant to contracts that provide for payment and delivery
on a future date. We must approve all institutions, but they may include, among
others:
. commercial and savings banks;
. insurance companies;
. pension funds;
. investment companies; and
. educational and charitable institutions.
The institutional purchaser's obligations under the contract are only
subject to the condition that the purchase of the offered securities at the
time of delivery is allowed by the laws that govern the purchaser. The dealers
and our agents will not be responsible for the validity or performance of the
contracts.
We may have agreements with the underwriters, dealers and agents to
indemnify them against certain civil liabilities, including liabilities under
the Securities Act, or to contribute with respect to payments which the
underwriters, dealers or agents may be required to make as a result of those
certain civil liabilities.
When we issue the securities offered by this prospectus, except for shares
of our common stock, they may be new securities without an established trading
market. If we sell a security offered by this prospectus to an underwriter for
public offering and sale, the underwriter may make a market for that security,
but the underwriter will not be obligated to do so and could discontinue any
market making without notice at any time. Therefore, we cannot give any
assurances to you concerning the liquidity of any security offered by this
prospectus.
Underwriters and agents and their affiliates may be customers of, engage in
transactions with, or perform services for us or our subsidiaries in the
ordinary course of their and/or our businesses.
23
LEGAL MATTERS
Certain legal matters will be passed upon for us by Jeffrey A. Brown of our
Law Department and Winston & Strawn, Chicago, Illinois. As of May 15, 2001, Mr.
Brown owned approximately 1,400 shares of common stock and held options to
purchase 27,400 shares of common stock, of which options to purchase 4,975
shares were currently exercisable.
EXPERTS
The consolidated financial statements and schedule of Motorola and
subsidiaries as of December 31, 2000 and 1999 and for each of the years in the
three-year period ended December 31, 2000 have been incorporated by reference
herein and in the registration statement in reliance upon the reports of KPMG
LLP, independent certified public accountants, incorporated by reference herein
and in the registration statement, and upon the authority of said firm as
experts in auditing and accounting.
24
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following is an estimate pursuant to instruction to Item 511 of
Regulation S-K, subject to future contingencies, of the expenses to be incurred
by the Registrant in connection with the issuance and distribution of the
securities being registered:
Registration Fee.............................................. $ 500,000
Legal Fees and Expenses....................................... 150,000
Trustee Fees and Expenses..................................... 30,000
Accounting Fees and Expenses.................................. 150,000
Blue Sky and Legal Investment Fees and Expenses............... 10,000
Printing and Engraving Fees................................... 150,000
Rating Agency Fees............................................ 1,400,000
Listing Fees.................................................. 60,000
Miscellaneous................................................. 50,000
----------
Total..................................................... $2,500,000
==========
Item 15. Indemnification of Directors and Officers
Section 145 of the Delaware General Corporation Law contains detailed
provisions for indemnification of directors and officers of Delaware
corporations against expenses, judgments, fines and settlements in connection
with litigation.
The Registrant's Restated Certificate of Incorporation and its directors'
and officers' liability insurance policy provide for indemnification of its
directors and officers against certain liabilities.
Reference is made to Section 6 of the Form of Underwriting Agreement filed
as Exhibit 1.1 and to Section 8 of the Form of Distribution Agreement filed as
Exhibit 1.3 for a description of the contemplated indemnification arrangements.
Item 16. Exhibits
The following Exhibits are filed as part of this Registration Statement:
1.1 Form of Underwriting Agreement for Debt Securities, Common Stock,
Debt Securities Warrants and Common Stock Warrants.*
1.2 Form of Distribution Agreement (incorporated by reference to
Exhibit 1(b) of the Registrant's Registration Statement on Form S-
3 dated October 17, 1994 (File No.
33-56055)).
4.1 Restated Certificate of Incorporation (incorporated by reference
to Exhibit 3(i)(b) to the Registrant's Quarterly Report on Form
10-Q for the quarter ended April 1, 2000 (File No. 1-7221)).
4.2 Certificate of Designations, Preferences and Rights of Junior
Participating Preferred Stock, Series B (incorporated by reference
to Exhibit 3.3 to Motorola's Registration Statement on Form S-3
dated January 20, 1999 (Registration No. 333-70827)).
4.3 By-Laws, as amended through March 9, 2001 (incorporated by
reference to Exhibit 3.3 of the Registrant's Annual Report on Form
10-K for the year ended December 31, 2000 (File No. 1-7221)).
II-1
4.4 Rights Agreement, dated as of November 5, 1998 between Motorola,
Inc. and Harris Trust and Savings Bank, as Rights Agent
(incorporated by reference to Exhibit 1.1 to Registrant's
Registration Statement on Form 8-A/A dated March 16, 1999 (File
No.
1-7221)).
4.5 Senior Indenture, dated as of May 1, 1995, between Harris Trust
and Savings Bank and Motorola, Inc. (incorporated by reference to
Exhibit 4(d) of the Registrant's Registration Statement on Form
S-3 dated September 25, 1995 (File No. 33-62911)).
4.6 Instrument of Resignation, Appointment and Acceptance, dated as
of January 22, 2001, among Motorola, Inc., Bank One Trust
Company, N.A. and BNY Midwest Trust Company (as successor in
interest to Harris Trust and Savings Bank (incorporated by
reference to Exhibit 4.2(b) of the Registrant's Annual Report on
Form 10-K for the year ended
December 31, 2000 (File No. 1-7221)).
4.7 Form of Subordinated Indenture (incorporated by reference to
Exhibit 4(e) of the Registrant's Registration Statement on Form
S-3 dated October 17, 1994 (File No.
33-56055)).
4.8 Form of Senior Security (incorporated by reference to Exhibit
4(g) of the Registrant's Registration Statement on Form S-3 dated
October 17, 1994 (File No. 33-56055)).
4.9 Form of Subordinated Security (incorporated by reference to
Exhibit 4(h) of the Registrant's Registration Statement on Form
S-3 dated October 17, 1994 (File No.
33-56055)).
4.10 Form of Debt Warrant Agreement (incorporated by reference to
Exhibit 4(i) of the Registrant's Registration Statement on Form
S-3 dated October 17, 1994 (File No.
33-56055)).
4.11 Form of Common Stock Warrant Agreement (incorporated by reference
to Exhibit 4(j) of the Registrant's Registration Statement on
Form S-3 dated October 17, 1994 (File No.
33-56055)).
4.12 Form of Common Stock Certificate (incorporated by reference to
Exhibit 4(k) of the Registrant's Registration Statement on Form
S-3 dated October 17, 1994 (File No.
33-56055)).
4.13 Form of Warrant Certificate for Common Stock (incorporated by
reference to Exhibit 4(l) of the Registrant's Registration
Statement on Form S-3 dated October 17, 1994 (File No. 33-
56055)).
4.14 Form of Warrant Certificate for debt securities (incorporated by
reference to Exhibit 4(m) of the Registrant's Registration
Statement on Form S-3 dated October 17, 1994 (File No. 33-
56055)).
5 Opinion and Consent of Jeffrey A. Brown, Esq.*
12 Statement re: computation of ratio of earnings to fixed charges
(incorporated by reference to Exhibit 12 of the Registrant's
Annual Report on Form 10-K for the year ended December 31, 2000
(File No. 1-7221)).
23.1 Consent of Jeffrey A. Brown (included as part of Exhibit 5).*
23.2 Consent of KPMG LLP.*
24 Powers of Attorney (included on signature page).*
25.1 Statement of Eligibility of Bank One Trust Company, N.A., as
Trustee, on Form T-1 (incorporated by reference to Exhibit 25.1
to the Registrant's Registration Statement on Form S-3 dated
January 12, 2001 (File No. 333-53686)).
--------
*Previously filed.
II-2
Item 17. Undertakings
(a) The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement (i) to include
any prospectus required by Section 10(a)(3) of the Securities Act of 1933,
(ii) to reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
Registration Statement, notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high and of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than a 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective Registration Statement, and (iii) to include any material
information with respect to the plan of distribution not previously
disclosed in the Registration Statement or any material change to such
information in the Registration Statement; provided, however, that
paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information
required to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed with or furnished to the Commission
by the Registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The Registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of the Registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the Registration
Statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) The Registrant hereby undertakes to file an application for the purpose
of determining the eligibility of the trustee to act under subsection (a) of
Section 310 of the Trust Indenture Act ("Act") in accordance with the rules and
regulations prescribed by the Securities and Exchange Commission under Section
305(b)(2) of the Act.
(d) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act of 1933 and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer, or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer, or controlling
person in connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement, or amendment thereto, to be signed on its behalf by the undersigned,
thereunto duly authorized, in the Village of Schaumburg and the State of
Illinois, on the 16th day of May, 2001.
MOTOROLA, INC.
/s/ Carl F. Koenemann
By: _________________________________
Carl F. Koenemann
Executive Vice President and
Chief Financial Officer
* * * *
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to Registration Statement has been signed by the following
persons in the capacities and as of the dates indicated.
Signature Title Date
--------- ----- ----
* Chairman of the Board and May 16, 2001
____________________________________ Chief Executive Officer
Christopher B. Galvin (Principal Executive
Officer)
* Executive Vice President and May 16, 2001
____________________________________ Chief Financial Officer
Carl F. Koenemann (Principal Financial
Officer)
* Senior Vice President and May 16, 2001
____________________________________ Controller
Anthony Knapp (Principal Accounting
Officer)
* Director May 16, 2001
____________________________________
Francesco Caio
* Director May 16, 2001
____________________________________
Ronnie C. Chan
* Director May 16, 2001
____________________________________
H. Laurance Fuller
* Director May 16, 2001
____________________________________
Robert L. Growney
II-4
Signature Title Date
--------- ----- ----
* Director May 16, 2001
____________________________________
Anne P. Jones
* Director May 16, 2001
____________________________________
Judy C. Lewent
* Director May 16, 2001
____________________________________
Dr. Walter E. Massey
* Director May 16, 2001
____________________________________
Nicholas Negroponte
* Director May 16, 2001
____________________________________
John E. Pepper, Jr.
* Director May 16, 2001
____________________________________
Samuel C. Scott III
* Director May 16, 2001
____________________________________
B. Kenneth West
* Director May 16, 2001
____________________________________
Dr. John A. White
/s/ Carl F. Koenemann
*By: _____________________
Carl F. Koenemann
as Attorney-in-Fact
II-5