Dear Investor:
I am pleased to provide you with this prospectus for MCDirect Shares--
McDonald's direct stock purchase plan. This Plan provides investors with a
convenient way to begin and build their McDonald's share ownership and
reinvest dividends.
McDonald's is one of the world's best-known global foodservice retailers,
with more than 30,000 restaurants in over 100 countries, serving about 46
million people a day.
We will build on our global leadership and strive to achieve our vision to be
the world's best quick service restaurant experience by consistently
satisfying customers around the world through outstanding quality, service,
cleanliness and value.
I look forward to sharing ownership of McDonald's and our future with you.
Sincerely,
Jim Cantalupo
Chairman and Chief Executive Officer
February 2003
MCDirect Shares Prospectus
We are pleased to offer MCDirect Shares (the "Plan"), a direct stock purchase
plan that provides investors with a convenient way to begin and build their
McDonald's share ownership and reinvest dividends.
> UNDER THE PLAN, YOUR CASH DIVIDENDS WILL AUTOMATICALLY BE REINVESTED IN
ADDITIONAL SHARES OF MCDONALD'S COMMON STOCK ("STOCK").
> IF YOU ARE NOT A SHAREHOLDER, YOU MAY ENROLL BY INVESTING AT LEAST $500 OR
BY AUTHORIZING AUTOMATIC MONTHLY INVESTMENTS OF AT LEAST $50.
> IF YOU HOLD AT LEAST 10 SHARES OF MCDONALD'S STOCK IN YOUR NAME, YOU MAY
ENROLL.
> IF YOU HOLD LESS THAN 10 SHARES IN YOUR NAME, YOU MAY ENROLL BY INVESTING
AT LEAST $500 OR BY AUTHORIZING AUTOMATIC MONTHLY INVESTMENTS OF AT LEAST
$50.
> IF YOU ARE A MCDONALD'S SYSTEM MEMBER, YOU MAY JOIN THE PLAN AND INVEST IN
MCDONALD'S STOCK BY AUTHORIZING PAYROLL DEDUCTION CONTRIBUTIONS TO THE PLAN
OF AT LEAST $20 PER INVESTMENT, IF OFFERED BY YOUR EMPLOYER.
> IN THE UNITED STATES, YOU MAY OPEN A CUSTODIAL ACCOUNT FOR A MINOR UNDER
THE UNIFORM GIFTS/TRANSFERS TO MINORS ACT BY INVESTING AT LEAST $100,
AUTHORIZING MONTHLY AUTOMATIC INVESTMENTS OF AT LEAST $50 OR TRANSFERRING AT
LEAST ONE SHARE TO THE MINOR.
> YOU MAY ENROLL BY MAIL OR ONLINE AT WWW.MCDONALDS.EQUISERVE.COM.
> ONCE ENROLLED, YOU MAY MAKE ADDITIONAL INVESTMENTS OF $50 OR MORE BY MAIL
OR ONLINE AT WWW.MCDONALDS.EQUISERVE.COM.
>IF YOU ARE A SHAREHOLDER, YOU MAY DEPOSIT YOUR MCDONALD'S STOCK CERTIFICATES
WITH OUR PLAN ADMINISTRATOR FOR SAFEKEEPING, WHETHER OR NOT YOU PARTICIPATE
IN THE PLAN.
> YOU MAY ESTABLISH A TRADITIONAL, EDUCATION OR ROTH INDIVIDUAL RETIREMENT
ACCOUNT (IRA) THAT INVESTS IN MCDONALD'S STOCK.
> YOU WILL BE REQUIRED TO PAY FEES IN CONNECTION WITH THE PLAN. THESE FEES
ARE DESCRIBED IN THIS PROSPECTUS. IN ADDITION TO THESE FEES, THE IRA TRUSTEE
WILL CHARGE IRA PARTICIPANTS WITH APPLICABLE FEES AND EXPENSES, WHICH ARE
DESCRIBED IN A SEPARATE IRA TRUST AND DISCLOSURE STATEMENT REFERENCED IN THIS
PROSPECTUS.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED MCDONALD'S STOCK OR DETERMINED IF THIS
PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS FEBRUARY 7, 2003.
TABLE OF CONTENTS
2 McDonald's Corporation
2 MCDirect Shares
6 Transaction or Plan
Service Fees
8 Income Taxation
8 Where To Get More
Information
9 Use of Proceeds
9 Plan of Distribution
9 Legal Matters
9 Experts
9 Inquiries
1
MCDONALD'S CORPORATION
McDonald's Corporation, together with its subsidiaries and affiliates
(hereinafter, collectively referred to as the "Company" or as "McDonald's"),
operates in the food service industry and primarily operates in the quick
service restaurant businesses under the McDonald's brand. These restaurants
serve a varied, yet limited, value-priced menu. In addition, McDonald's
operates other restaurant concepts under its Partner Brands: Boston Market,
Chipotle and Donatos Pizzeria. In February 2001, McDonald's acquired a
minority interest in Pret A Manger. In December 2002, McDonald's acquired a
preferred equity interest in Fazoli's, and acquired a majority interest in a
joint venture to develop and operate a limited number of Fazoli's
restaurants. All restaurants are operated by the Company or, under the terms
of franchise arrangements, by franchisees who are independent entrepreneurs,
or by affiliates operating under joint-venture agreements between McDonald's
or its subsidiaries and local business people. McDonald's operations are
designed to assure consistent quality of product, cleanliness and efficiency
and speed of service at every restaurant. McDonald's operates more than 30,000
restaurants, located in more than 100 countries. Our principal executive
offices are located at One McDonald's Plaza, Oak Brook, IL 60523; our
telephone number is 1-630-623-3000.
MCDIRECT SHARES
PURPOSE
MCDirect Shares is a direct stock purchase plan that provides investors with
a convenient way to begin and build their McDonald's share ownership and
reinvest dividends.
ADMINISTRATION
The MCDirect Shares Plan Administrator is EquiServe Limited Partnership and
its subsidiary, EquiServe Trust Company, N.A. (hereinafter, collectively
referred to as "EquiServe", "Plan Administrator" or "Administrator"). The
Plan Administrator purchases and holds shares purchased under the Plan,
maintains records, sends statements of account to participants, and performs
other duties related to the Plan.
ELIGIBILITY AND ENROLLMENT
You are eligible to participate in the Plan if you meet the requirements
described below. Regulations in certain countries may limit or prohibit
participation in this type of plan. Therefore, if you live outside the U.S.,
you should first determine whether you are subject to any governmental
regulations prohibiting your participation in the Plan or affecting the terms
of the Plan. McDonald's has the right to terminate participation of any
shareholder if it deems it advisable under any foreign laws or regulations.
You will be charged transaction fees for participating in the Plan (including
a $5.00 enrollment fee), certain investment fees and, if applicable,
additional IRA fees. The enrollment fee, as well as an investment fee, will
be deducted from your initial investment. See "Transaction or Plan Service
Fees" on page 6.
SHAREHOLDERS
If you hold at least 10 shares of McDonald's stock in your name, or one share
registered in custodial name for a minor, you or the minor, respectively, may
join the Plan. If you hold less than 10 shares in your name, you may join the
Plan by making an initial investment of at least $500 (or $100 for custodial
accounts) or by authorizing automatic monthly investments of at least $50 per
month. You can get started by returning a completed enrollment form to the
Plan Administrator or by enrolling online at WWW.MCDONALDS.EQUISERVE.COM. See
"Methods of Investment--Automatic Monthly Investments" on page 3.
NON-SHAREHOLDERS
If you do not currently own McDonald's stock, you may join the Plan by making
an initial investment of at least $500 (or $100 for custodial accounts) or by
authorizing automatic monthly investments of at least $50 per month. You can
get
2
started by returning a completed enrollment form to the Plan
Administrator or by enrolling online at WWW.MCDONALDS.EQUISERVE.COM. See
"Methods of Investment--Automatic Monthly Investments" on this page.
MCDONALD'S SYSTEM MEMBERS
If you are a McDonald's System member, you may also join the Plan by
returning a completed enrollment form to your human resources representative
and authorizing payroll deduction contributions to the Plan of at least $20
per investment, if offered by your employer. The McDonald's System members
include McDonald's franchisees and suppliers, their employees and employee
benefit plans, as well as employees of McDonald's, its subsidiaries and
affiliates. See "MCDirect Shares--Eligibility and Enrollment" on page 2 and
"Methods of Investment--Payroll Deductions" on page 4.
"STREET NAME" HOLDERS
If your shares are held by a bank, broker or trustee, you may join the Plan
by directing your bank, broker or trustee to register at least 10 shares (or
one share for custodial accounts) of McDonald's stock directly in your name
or the custodial name for a minor. You can then get started by returning a
completed enrollment form to the Plan Administrator or by enrolling online at
WWW.MCDONALDS.EQUISERVE.COM.
INDIVIDUAL RETIREMENT ACCOUNT (IRA)
You can establish a Traditional IRA, Roth IRA, or Education IRA that invests
in McDonald's stock by making an initial investment to the IRA of at least
$500 or by transferring at least 10 shares of McDonald's stock or $500 or
more from an existing IRA. You should be aware that the IRA Trustee
administers IRAs in compliance with U.S. Internal Revenue Service
requirements. The IRA trust agreement and disclosure statement describes how
IRAs will be administered and as such, the terms described therein supersede
the terms of MCDirect Shares. You can get started by returning an IRA
Enrollment Form and an IRA Funds Transfer Form to the Plan Administrator.
These forms and an IRA trust agreement and disclosure statement, including
information regarding fees, are available from the Plan Administrator by
calling 1-800-621-7825. See "Individual Retirement Account (IRA)
Fees/Expenses" on page 6.
METHODS OF INVESTMENT
Investments cannot exceed $250,000 per calendar year and must be made in U.S.
dollars. For the purpose of applying this limit, all investments during any
calendar year (including initial and ongoing investments, but excluding
dividend reinvestments and share deposits) are aggregated. The Plan
Administrator will arrange for the purchase of shares for your account, but
will not pay interest on amounts pending investment.
You may be charged fees to invest in McDonald's stock under the Plan. See
"Transaction or Plan Service Fees" on Page 6.
OPTIONAL SINGLE INVESTMENTS
Once enrolled, you may make additional investments of $50 or more through the
Plan online at WWW.MCDONALDS.EQUISERVE.COM or by mailing a check for at least
$50, payable to EquiServe. Please mail the completed transaction form located
on your account statement or transaction advice, along with your investment,
to the address specified on the form. Any individual or entity (including
McDonald's) may make additional cash investments for any participant or
eligible investor as a gift, award or as an incentive for future performance.
AUTOMATIC MONTHLY INVESTMENTS
If you wish to make regular monthly cash investments, you may authorize an
automatic monthly withdrawal of at least $50 from your U.S. bank account. To
get started, you must complete and return the automatic investment section of
the enrollment form or authorize automatic ongoing investments online at
WWW.MCDONALDS.EQUISERVE.COM. Funds will be deducted from your account on the
15th of each month or the last day of each month (whichever date you choose),
3
or if the date falls on a bank holiday or weekend, the next business day.
Please allow up to four weeks for the first automatic investment to begin. To
change or terminate automatic investments, you must notify the Plan
Administrator in writing at least six business days before the next automatic
debit date.
PAYROLL DEDUCTIONS
If you are a McDonald's System member, you may authorize payroll deduction
contributions to the Plan of at least $20 per investment, if offered by your
employer. You should contact your personnel department or human resources
representative to determine if payroll deductions are available to you and
what the procedures are for initiating, changing and terminating payroll
deductions.
DIVIDENDS
By participating in the Plan, your cash dividends on shares, including
fractional shares held in the Plan, along with any certificated shares, will
be automatically reinvested in additional shares of McDonald's stock. Cash
dividends are declared and paid on an annual basis at the discretion of the
Board of Directors.
TRANSFER OF SHARES FROM STREET NAME
If a bank, a broker, a trustee or other agent holds your shares, you may
transfer these shares to a Plan account by directing your agent to register
these shares directly in your name, using the same name/registration as on
your existing Plan account.
SHARE PURCHASES
Shares will be purchased by the Plan Administrator either on the open market
or directly from McDonald's. Shares purchased on the open market may be made
on any stock exchange in the United States where McDonald's stock is traded,
in the over-the-counter market or by negotiated transactions on terms the
Plan Administrator reasonably determines at the time of purchase. In rare
instances, purchases may be delayed to meet temporary curtailment or
suspension of trading based on the actions of regulators and market
administrators or emergency circumstances affecting receipt and execution of
orders by brokers or market facilities. Any shares purchased by the Plan
Administrator from McDonald's will be made in accordance with applicable
requirements. Neither McDonald's nor any participant shall have any authority
or power to control the timing or pricing of shares purchased, or the
selection of the broker making the purchases. Therefore, you will not be able
to precisely time your purchases through the Plan and will bear the market
risk associated with fluctuations in the price of McDonald's stock. That is,
if you send in an initial or optional single cash investment or authorize
automatic ongoing investments or payroll deductions, it is possible that the
market price of McDonald's stock could go up or down before the broker
purchases stock with your funds. In addition, you will not earn interest on
investments for the period before the shares are purchased. You will be
charged fees to purchase shares of McDonald's stock under the Plan. See
"Transaction or Plan Service Fees" on page 6.
Purchases will be made weekly, but may be made daily when practicable. If
any such date is a day when the stock market is not open, purchases will be made
the next business day. When McDonald's stock is purchased on the open market,
your price per share will be the weighted average purchase price of shares
purchased on that date. In the case of purchases from McDonald's, your price per
share will be the average of the high and low sales prices of McDonald's stock,
as reported on the New York Stock Exchange Composite Tape, on that date.
SALES OF MCDONALD'S STOCK
You may sell any number of whole shares in your Plan account or safekeeping
account by calling 1-800-Mc1-STCK or by accessing your account on a secured
website at WWW.MCDONALDS.EQUISERVE.COM and providing the required account
identification and security information, or by completing and returning the
appropriate section of a transaction form to the Plan Administrator. The Plan
Administrator will sell those shares, along with shares to be sold for other
accounts, as promptly as practicable at 100 percent of the then current
market price of McDonald's stock and
4
will send you a check or wire the sales proceeds, less any sales and trading
fees. Note that the sales fees in effect under the Plan at the time a sales
transaction is executed apply to all sales transactions through the Plan
regardless of when or how the shares sold were acquired. See "Transaction or
Plan Service Fees" on page 6.
Alternatively, you can choose to sell your shares through a stockbroker of
your choice. In that case, you must request that your shares be moved to your
broker or have the Plan Administrator issue a certificate for your shares. If
you elect to sell through a broker, you will pay whatever sales fees are charged
by your broker, rather than the sales fees provided under the Plan.
WITHDRAWAL FROM THE PLAN/ISSUANCE OF CERTIFICATES
You can withdraw some or all of your shares from your Plan account by
properly notifying the Plan Administrator. The Plan Administrator will
transfer your shares to a book-entry account maintained by the Plan
Administrator, unless you request a certificate.
Certificates will be issued for whole shares only. If your request involves
a fractional share, a check for the value of the fractional share (less
applicable fees) will be mailed to you. Please allow three to five business days
to process your request.
Certificates will be issued in the name(s) in which the account is
registered, unless otherwise instructed. In addition, checks will be payable to
the name(s) in which the account is registered, unless otherwise instructed. If
the certificate or check is to be issued in a name other than your Plan or
safekeeping account registration, the signature(s) on the instructions or stock
power must be guaranteed by a financial institution participating in the
Medallion Guarantee program.
The Plan Administrator will process notices of withdrawal and uninvested
funds will be returned to you as soon as practicable, without interest. If
your request to withdraw from the Plan is received on or after a dividend
record date, but before the dividend payment date, your withdrawal will be
processed as soon as practicable, and a separate dividend check will be
mailed to you within five business days after the dividend payment date.
Future dividends will be paid in cash, unless you rejoin the Plan.
SAFEKEEPING OF YOUR STOCK CERTIFICATES
Shares of McDonald's stock that you buy under the Plan will be maintained in
your Plan account in book-entry for safekeeping. You will receive an annual
statement detailing the status of your holdings. McDonald's shareholders who
do not participate in the Plan may use the Plan's "safekeeping" service to
deposit their McDonald's stock certificates at no cost. Because McDonald's
and the Plan Administrator are responsible for the safekeeping of McDonald's
stock certificates deposited with the Plan, you no longer bear the risk and
cost associated with the loss, theft or destruction of stock certificates so
deposited. Shareholders using this service who are not Plan participants will
receive dividends in cash until they enroll in the Plan. With safekeeping,
you can take advantage of the transfer and sale of shares features of the
Plan. Certificates will be issued upon request to the Plan Administrator. See
"Withdrawal from the Plan/Issuance of Certificates" on this page.
To use the safekeeping service, send your certificates to the Plan
Administrator by registered mail with written instructions to deposit them in
safekeeping. Do not endorse the certificates or complete the assignment section.
If you mail the certificates, you may want to insure them for 2 percent of their
value to cover their accidental loss during mailing.
GIFT/TRANSFER OF SHARES
You may gift or transfer McDonald's stock held in your Plan or safekeeping
account to anyone you choose. You will not be charged any fees to gift or
transfer share(s) under the Plan. In order to transfer some or all of your
Plan shares or shares held in safekeeping, you must send the Plan
Administrator signed transfer instructions. Your signature must be guaranteed
by a bank or other financial institution participating in the Medallion
Guarantee program.
5
If you are opening a new Plan account, you must send a completed
enrollment form, a $5.00 enrollment fee and instructions to transfer at least
10 shares (or one share for a custodial account). If you transfer fewer than
10 shares, they will be held in the Plan's "safekeeping" service at no cost.
See "Safekeeping of Your Stock Certificates" on page 5.
TRANSACTION OR PLAN SERVICE FEES
ENROLLMENT FEE $ 5.00
----------------------------------------------------------------------------------------------------
INVESTMENT FEES
via optional one-time investment $ 6.00
via automatic ongoing monthly investments $ 1.50
via payroll deduction $ 0
via dividend reinvestment $ 0
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SALES FEES
per transaction $15.00
plus a per share sales fee (the per share sales fee is capped
at $35.00 within a single transaction*) $ .15
PROCEEDS VIA WIRE domestic add $25.00
international add $50.00
----------------------------------------------------------------------------------------------------
FEE FOR BOUNCED CHECKS OR REJECTED AUTOMATIC INVESTMENTS $20.00
----------------------------------------------------------------------------------------------------
* THE MAXIMUM TOTAL FEE A PARTICIPANT WILL PAY TO SELL SHARES THROUGH THE
PLAN IN A SINGLE TRANSACTION IS $50.00. MCDONALD'S WILL MAINTAIN THE $35 CAP
ON PER SHARE SALES FEES WITHIN A SINGLE TRANSACTION THROUGH FEBRUARY 7, 2005,
SO LONG AS THE PLAN REMAINS IN EFFECT AND IS NOT TERMINATED.
The Plan Administrator will deduct the applicable fees from proceeds due from
a sale or funds received for investment. McDonald's will not increase any of
the fees under MCDirect Shares through June 10, 2004, so long as the Plan
remains in effect and is not terminated.
Because of the structure of the Plan fees, the cost to participate in the
Plan on a per share basis decreases with the number of shares bought or sold
in a single transaction, except for payroll deduction. For this reason, you
should carefully consider the impact of the costs of participation in the
Plan on your investment returns.
INDIVIDUAL RETIREMENT ACCOUNT (IRA) FEES/EXPENSES
In addition to the fees described above, the IRA Trustee will charge IRA
participants with applicable fees and expenses, including an annual IRA
account fee. These fees and any future fee increases are described in the IRA
trust agreement and disclosure statement available by calling the Plan
Administrator at 1-800-621-7825. The annual IRA fee will be deducted from
your initial investment, or can be paid separately. Future annual IRA fees
will be deducted from your Plan account by selling sufficient shares to cover
the fee, unless paid separately. Beginning no earlier than June 10, 2004, the
IRA Trustee will increase IRA fees, which are described in the IRA trust
agreement and disclosure statement. See "Individual Retirement Account (IRA)"
on page 3.
ACCOUNT STATEMENTS
The Plan Administrator will establish and maintain a separate account under
the Plan for you. You will receive transaction advices for account activity
(except reinvested dividends and payroll deductions) and an annual statement
listing your transactions. Online access to your account information is
available at the secured website, WWW.MCDONALDS.EQUISERVE.COM. For additional
sources of account information, see "Inquiries" on page 9.
STOCK SPLITS; STOCK DIVIDENDS; OTHER DISTRIBUTIONS
In the event dividends are paid in McDonald's stock, or if McDonald's stock
is distributed in connection with any stock split or similar transaction,
your account will be adjusted accordingly.
6
VOTING OF PROXIES
You will receive proxy materials, including a proxy for shares of McDonald's
stock held in your Plan account either via mail, or with your consent at
WWW.ECONSENT.COM/MCD, via an e-mail with links to view the materials and vote
your shares online. Either way, the proxy will be voted as indicated by you.
If you do not vote your proxy by phone, via the Internet, or return a proxy
card by mail; or if you return a proxy card unsigned prior to the fifth
calendar day before a shareholder meeting, the Plan Administrator will vote
your Plan shares in accordance with the majority of the Plan shares voted by
participants.
RESPONSIBILITY OF THE PLAN ADMINISTRATOR AND MCDONALD'S
Neither McDonald's nor the Plan Administrator will be liable for any act they
do in good faith or for any good faith omission to act. This includes,
without limitation, liability for: the failure to terminate your account upon
your death prior to receiving written notice, or any purchase or sale
prices reflected in your Plan account or the dates of purchases or sales of
your Plan shares or any fluctuation in the market value after purchase or
sale of shares.
Neither McDonald's nor the Plan Administrator can assure a profit or protect
you against a loss on the shares you purchase under the Plan. The payment of
dividends is at the discretion of the McDonald's Board of Directors and will
depend on future earnings, the financial condition of McDonald's and other
factors. The Board may change the amount and timing of dividends at any time
without notice.
MODIFICATION OR TERMINATION OF THE PLAN
McDonald's may modify or terminate the Plan at any time and, in such event,
participants will be so notified in writing sent by U.S. Mail at least thirty
(30) days in advance of the effective date of any modification or
termination. The Administrator also reserves the right to change any
administrative procedures of the Plan.
APPLICATION OF MODIFICATION OR TERMINATION
Any modification made to or termination of the Plan will apply to a
participant's holdings in the Plan at the time the modification or
termination becomes effective and to transactions occurring thereafter,
regardless of when or how the shares were acquired.
INTERPRETATION OF THE PLAN
McDonald's may interpret and regulate the Plan as deemed necessary or
desirable in connection with the operation of the Plan and resolve questions
or ambiguities concerning the various provisions of the Plan.
GOVERNING LAW
The Plan is governed by and construed in accordance with the laws of the
State of Illinois.
CHANGE OF ELIGIBILITY; TERMINATION
The Plan Administrator will from time to time review your Plan account to
determine whether you continue to be eligible to participate in the Plan. If
the Plan Administrator determines that you are no longer eligible to
participate, or if the Plan is terminated, the Plan Administrator will notify
you in writing. The Plan Administrator will transfer all of your shares of
McDonald's stock in your Plan account to a book entry/safekeeping account
maintained by the Plan Administrator, unless otherwise instructed. Please
allow up to 30 days for this transfer. You may request a certificate for your
whole shares and a check for the value of any fractional shares (based on the
then current market price, less applicable fees). You may also request a sale
of your shares. See "Sales of McDonald's Stock" on page 4. If your account
consists of only a fractional share, the Plan Administrator may close your
account by notifying you in writing and sending a check to you for the value
of the fractional share based on the last sale price for any whole shares
sold, less any sales and trading fees. See "Transaction or Plan Service Fees"
on page 6.
7
INCOME TAXATION
TAX CONSEQUENCES OF PARTICIPATING IN THE PLAN CAN VARY DEPENDING ON EACH
PARTICIPANT'S TAX SITUATION. THIS SUMMARY IS NOT A COMPREHENSIVE SUMMARY OF
ALL TAX CONSIDERATIONS THAT MAY BE RELEVANT TO YOUR PARTICIPATION IN THE
PLAN. IN ADDITION, SPECIAL TAX CONSIDERATIONS MAY APPLY TO CERTAIN
PARTICIPANTS, SUCH AS THOSE IN NON-U.S. COUNTRIES AND THOSE PARTICIPATING
THROUGH AN IRA. THEREFORE, YOU ARE URGED TO CONSULT YOUR TAX ADVISOR
REGARDING THE CONSEQUENCES OF PARTICIPATION IN THE PLAN IN LIGHT OF CURRENT
AND PROPOSED FEDERAL, STATE, LOCAL, FOREIGN AND OTHER TAX LAWS.
U.S. FEDERAL INCOME TAXATION
Cash dividends reinvested under the Plan will be taxable as having been
received by you even though you have not received them in cash. You will
receive an annual statement from the Plan Administrator indicating the amount
of the reinvested dividend reported to the U.S. Internal Revenue Service as
dividend income.
FOREIGN PARTICIPATION/TAXATION
Regulations in certain countries may limit or prohibit participation in this
type of plan. Therefore, if you live outside the U.S., you should first
determine if there are any laws or governmental regulations that would
prohibit your participation in the Plan or affect the terms of the Plan.
McDonald's has the right to terminate participation of any shareholder if it
deems it advisable under any foreign laws or regulations. Tax consequences of
participating in the Plan may vary under foreign laws or regulations and you
should determine the tax treatment of Plan features, such as dividend
reinvestment, before you decide to invest through the Plan.
WHERE TO GET MORE INFORMATION
McDonald's files annual, quarterly and current reports, proxy statements and
other information with the U.S. Securities and Exchange Commission ("SEC").
You may read and copy any reports, statements or other information filed by
McDonald's at the SEC's public reference room in Washington, D.C. You can
request copies of these documents, upon payment of a duplicating fee, by
contacting the SEC. Please call the SEC at 1-800-SEC-0330 for further
information on the operation of the public reference room. SEC filings are
also available to the public at the SEC's website at WWW.SEC.GOV. You can
access SEC filings and sign up for e-mail notification of certain financial
releases on McDonald's website at WWW.INVESTOR.MCDONALDS.COM.
The following documents filed with the SEC are incorporated by reference
into this prospectus and are considered a part of this prospectus:
(a) our current reports on Form 8-K, filed with the SEC on December 10,
2002, and January 28, 2003;
(b) our Annual Report on Form 10-K for the fiscal year ended December 31,
2001;
(c) our Quarterly Reports on Form 10-Q for the quarters ended March 31,
2002, June 30, 2002 and September 30, 2002; and
(d) an amendment to the Registration Statement on Form 10, filed with the
SEC on April 23, 1991, that contains a description of McDonald's stock,
and any amendment or report that McDonald's files later to update that
description.
Later information that McDonald's files with the SEC will update this
information. McDonald's is also incorporating by reference all documents that
McDonald's files with the SEC pursuant to Sections 13 (a), 13 (c), 14 or 15(d)
of the Securities Exchange Act of 1934, as amended, after the date of this
prospectus.
McDonald's will provide, at no cost, any of the above documents
(including any exhibits that are specifically incorporated by reference in
them) to each person, including any beneficial owner, to whom a prospectus is
delivered. Written or telephone requests should be directed to: McDonald's
Shareholder Services, McDonald's Corporation, Kroc Drive, Oak Brook, Illinois
60523, telephone: 1-630-623-7428. McDonald's Summary Annual Report, MCDirect
Shares Plan brochure/prospectus/enrollment form and financial information are
available on our website at WWW.INVESTOR.MCDONALDS.COM.
8
You should rely only on the information incorporated by reference or
provided in this prospectus or in any prospectus supplement. McDonald's has
authorized no one to provide you with different information. McDonald's is
not making an offer to sell stock in any state or country where the offer is
not permitted. You should not assume that the information in this prospectus
or the prospectus supplement is accurate as of any date other than the date
of the document.
USE OF PROCEEDS
McDonald's will receive proceeds from the purchase of McDonald's stock under
the Plan only if purchases are made directly from McDonald's, and not from
open market purchases by the Plan Administrator. Proceeds received by
McDonald's from such purchases shall be used for general corporate purposes.
PLAN OF DISTRIBUTION
McDonald's stock offered pursuant to the Plan will be purchased in the open
market or, at McDonald's option, directly from McDonald's. You will be
charged fees for participating in the Plan. See "Transaction or Plan Service
Fees" on page 6. IRA participants will also be charged applicable fees and
expenses as set forth in the IRA trust agreement and disclosure statement.
See "Individual Retirement Account (IRA) Fees/Expenses" on page 6. McDonald's
will pay all other costs related to the administration of the Plan.
LEGAL MATTERS
Shelby Yastrow, a former Executive Vice President of McDonald's, has given
his opinion regarding the legality of the stock covered by this prospectus.
Mr. Yastrow owns shares of McDonald's stock, and he is eligible to participate
in the Plan.
EXPERTS
The consolidated financial statements of the Company included in the
Company's Annual Report on Form 10-K for the year ended December 31, 2001,
have been audited by Ernst & Young LLP, independent auditors, as set forth in
their report thereon included therein, and incorporated in this prospectus by
reference. Such consolidated financial statements are incorporated herein by
reference in reliance upon such report given on the authority of such firms
as experts in accounting and auditing.
INQUIRIES
BY PHONE
For information about your account, call the Plan Administrator at
1-800-Mc1-STCK (U.S. and Canada), 1-781-575-2731 (call collect outside of the
U.S.) or 1-201-222-4489 (TDD# for hearing impaired). An automated response
system providing account balance, stock prices and other information is
available 24 hours, 7 days a week. Representatives are available weekdays
between 9:00 a.m. and 5:00 p.m., Eastern Standard Time.
VIA THE INTERNET
Account information is available on the secure website,
WWW.MCDONALDS.EQUISERVE.COM. To access your account, you will need McDonald's
issue number (9826), your account number, U.S. Social Security Number, if
applicable, and password. To obtain a password, follow the instructions on
the website or call the Plan Administrator at 1-800-Mc1-STCK (U.S. and
Canada), 1-781-575-2731 (other countries may call collect) or 1-201-222- 4489
(TDD# for hearing impaired); or write via e-mail to MCDFCT@EQUISERVE.COM.
BY MAIL
Send correspondence to McDonald's Shareholder Services, c/o EquiServe, P.O.
Box 43074, Providence, RI 02940-3074. Mail MCDirect Shares enrollment forms
to McDonald's Shareholder Services, c/o EquiServe, P.O. Box 1506, Newark, NJ
07101-9628. Once enrolled in the Plan, mail optional investments to
McDonald's Shareholder Services, c/o EquiServe, P.O. Box 13531, Newark, NJ
07188-0001. Please include a transaction form, found at the bottom of your
account statement or transaction advice, or a letter that includes your
account number and your daytime telephone number.
9
STATE STREET GLOBAL MARKETS, LLC 225 Franklin Street, 19th Floor
Boston, MA 02110
Dear Investor:
The enclosed investment program material describes a plan that is designed to
provide individual investors with a convenient way to purchase company stock.
The investment program administrator's web site for shareholders is
WWW.EQUISERVE.COM. This site provides additional information on the program.
In addition, if you decide to open an account, you will be joining more than
20 million other shareholders who are able to view and manage their accounts
on-line at this versatile web site.
Please review the investment program material for complete details. State
Street Global Markets, LLC has sent you this material on behalf of the program
administrator to comply with the securities laws and regulations of certain
states.
The program administrator has provided the forms you will need to establish
an account and explained the ways in which you can reach it by phone, Internet
and U.S. mail. For faster service, please contact the program administrator
directly.
Thank you for your interest,
State Street Global Markets, LLC
Mutual funds and other securities are not bank deposits, are not FDIC insured
and are not obligations of or guaranteed by State Street Bank, or any of their
affiliates, and involve investment risks, including the possible loss of the
principal amount invested. In addition, this letter is not a recommendation for
the program and, while we believe that the accompanying material is adequately
precise, we cannot assume any responsibility for the accuracy of the statements
made therein. State Street Global Markets LLC, member NASD, SIPC, BSE and MSRB.
THIS PROSPECTUS should be read in conjunction with the documents incorporated by
reference therein. There shall be no sale of these securities in any state or
country in which such offer, solicitation or sale would be unlawful prior to
registration or qualification under the securities laws of any such state or
country.
QUESTIONS regarding MCDirect Shares should be directed to McDonald's Shareholder
Services at 1-800-Mc1-STCK (U.S. and Canada), 1-781-575-2731 (other countries
may call collect) or 1-201-222- 4489 (TDD# for hearing impaired).
The following trademarks used herein are owned by McDonald's Corporation:
McDonald's, The Golden Arches Logo, MCDirect Shares, The Design of Ronald
McDonald, 1-800-Mc1-STCK.
(C)2003 McDonald's Corporation
McD 5-2908 rev. 2/03
Printed in the U.S.A.
Printed on recycled paper with
30% post-consumer content