SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549-1004
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report
(Date of earliest event reported) July 15, 2003
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GENERAL MOTORS CORPORATION
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(Exact name of registrant as specified in its charter)
STATE OF DELAWARE 1-143 38-0572515
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
300 Renaissance Center, Detroit, Michigan 48265-3000
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (313) 556-5000
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Item 5. Other Events
General Motors Corporation's wholly-owned subsidiary, Hughes Electroncis
Corporation (Hughes) has reported previously in its Annual Report on Form
10-K for the year ended December 31, 2002, a dispute arising out of the 2000
sale by Hughes of its satellite systems manufacturing businesses to The Boeing
Company. The stock purchase agreement provided for a potential purchase price
adjustment based upon the final closing date financial statements of the
satellite systems manufacturing businesses. The stock purchase agreement also
provided for a dispute resolution process to resolve any disputes that arose in
determining the purchase price adjustment. Hughes acknowledged that it owed
Boeing a purchase price adjustment of $164 million plus interest at the rate of
9.5% from the date of sale, the total amount of which has been provided for in
Hughes' consolidated financial statements. Boeing claimed that additional
amounts were owed pursuant to the purchase price adjustment. The unresolved
amount as of March 31, 2003, was approximately $670 million. An arbitration
proceeding was commenced to resolve this dispute. On July 15, 2003, Hughes and
Boeing settled all matters related to this arbitration and certain other claims
related to Boeing's purchase of Hughes' satellite systems manufacturing
businesses. A copy of Hughes' press release related to the settlement, dated
July 15, 2003, is attached hereto as Exhibit 99.1 and is incorporated herein by
reference.
Hughes also has reported previously on a purported class action, P. Shoenfeld
Asset Management LLC, et al. v. Shaw et al., filed in Delaware Chancery Court
on December 18, 2002, against Hughes and the PanAmSat Board of Directors. The
suit alleged that the settlement between EchoStar Communications Corporation
and Hughes of all claims related to the termination of the proposed merger
between EchoStar and Hughes favored Hughes in violation of alleged fiduciary
duties. On July 10, 2003, the Delaware Chancery Court granted defendants'
motions to dismiss all claims with prejudice and denied plaintiffs' motion for
leave to amend the complaint. Unless successfully appealed by the plaintiffs,
this ruling effectively concludes this suit.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
Exhibit No. Exhibit
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99.1 Press Release, dated July 15, 2003
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
GENERAL MOTORS CORPORATION
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July 16, 2003
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By
/s/Peter R. Bible
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(Peter R. Bible,
Chief Accounting Officer)
EXHIBIT INDEX
Exhibit No. Exhibit
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99.1 Press Release, dated July 15, 2003
EXHIBIT 99.1
HUGHES, BOEING SETTLE PURCHASE PRICE ADJUSTMENT DISPUTES
IN 2000 SALE OF SATELLITE MANUFACTURING OPERATIONS
EL SEGUNDO, Calif., July 15, 2003 - Hughes Electronics Corporation today
announced a settlement agreement with The Boeing Company that resolves the
outstanding purchase price adjustment disputes arising from Boeing's October
2000 acquisition of Hughes satellite manufacturing operations.
A price adjustment procedure was provided under the purchase agreement when
Boeing acquired the HUGHES satellite systems manufacturing businesses in
October 2000 for $3.75 billion in cash. The operations were renamed Boeing
Satellite Systems, Inc. (BSS).
Under the terms of the agreement, HUGHES will settle all outstanding
purchase price adjustment disputes with Boeing by paying an aggregate $360
million in cash. Boeing also will be released from its commitment to pay HUGHES
$4.4 million over the next seven years in connection with Boeing's
participation in the settlement with the U.S. Department of State on China
launch issues of the mid-1990s. As a result of the settlement, Hughes will take
an after-tax charge of approximately $8 million that will be accounted for
under discontinued operations for the quarter ended June 30, 2003.
In connection with the settlement, Hughes Network Systems (HNS) agreed to
extend the scheduled launch date for the first BSS-built SPACEWAY satellite
from the fourth quarter of 2003 until February 2004. HNS, a subsidiary of
HUGHES, and BSS also agreed to amend other terms of the contract. The
modifications to the SPACEWAY satellite contract are not expected to have a
significant effect on HNS' plans for initiating SPACEWAY services in 2004.
Hughes Electronics Corporation, a unit of General Motors Corporation, is a
world-leading provider of digital television entertainment, broadband satellite
networks and services, and global video and data broadcasting. The earnings of
HUGHES are used to calculate the earnings attributable to the General Motors
Class H common stock (NYSE:GMH).
Hughes Electronics Corporation believes that some of the foregoing
statements may constitute forward-looking statements. When used in this
release, the words "expect," "intend," "believe" and other similar expressions
are intended to identify such forward-looking statements and information. These
statements are based on certain assumptions and analyses made in light of
Hughes' experience and perception of historical trends, current conditions and
expected future developments as well as other factors Hughes believes are
appropriate in the circumstances. However, whether actual developments will
conform with Hughes' expectations and predictions is subject to a number of
risks and uncertainties, including possible satellite construction delays,
launch failures, incorrect orbital placement, improper commercial operation or
the availability of insurance coverage and other factors set forth in Annual
Reports on Form 10-K filed with the SEC by General Motors and Hughes.
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