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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report
(Date of earlier event reported): May 19, 1998 Commission file number 1-5805
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THE CHASE MANHATTAN CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 13-2624428
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(State or Other Jurisdiction (I.R.S. Employer
of Incorporation) Identification No.)
270 Park Avenue, New York, NY 10017
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (212) 270-6000
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Item 5. Other Events
On May 19, 1998, The Chase Manhattan Corporation ("Chase") announced that
its stockholders approved a 2-for-1 split of Chase's common stock. The record
date for the split will be May 20, 1998, and the mail date for the additional
shares issued as a result of the split will be June 12, 1998. The split will be
reflected in trading beginning June 15, 1998. A press release relating to the
stock split is attached as an exhibit hereto.
Separately, on May 14, 1998, Chase commenced a public offering of
4,000,000 shares of its Fixed/Adjustable Rate Noncumulative Preferred Stock,
pursuant to a Prospectus dated June 9, 1997, as supplemented by a Prospectus
Supplement dated May 14, 1998 (collectively, the "Prospectus"). The Prospectus
constitutes a part of Chase's Registration Statement on Form S-3, File No.
33-64261 (the "Registration Statement"). The offering is scheduled to close on
May 21, 1998. Attached as an exhibit hereto is the Certificate of Designations
with respect to the Preferred Stock.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
The following exhibits are filed with this report:
Exhibit Number Description
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4 Certificate of Designations for
Fixed/Adjustable Rate Noncumulative
Preferred Stock
99 Press Release - Common Stock Split
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.
THE CHASE MANHATTAN CORPORATION
(Registrant)
By: /s/Anthony J. Horan
--------------------------
Anthony J. Horan
Corporate Secretary
Dated: May 20, 1998
EXHIBIT INDEX
Exhibit Number Description
-------------- -----------
4 Certificate of Designations for
Fixed/Adjustable Rate Noncumulative
Preferred Stock
99 Press Release - Common Stock Split
CERTIFICATE OF DESIGNATIONS
OF
FIXED/ADJUSTABLE RATE NONCUMULATIVE PREFERRED STOCK
OF
THE CHASE MANHATTAN CORPORATION
------------------------------------
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
------------------------------------
THE CHASE MANHATTAN CORPORATION, a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES
that the following resolutions were duly adopted by the Board of Directors of
the Corporation on January 20, 1998 and by the Stock Committee of the Board of
Directors on May 14, 1998, respectively, pursuant to authority conferred upon
the Board of Directors by the provisions of the Certificate of Incorporation of
the Corporation which authorize the issuance of up to 200,000,000 shares of
preferred stock of $1 par value per share (the "Preferred Stock"), and pursuant
to authority conferred upon the Stock Committee of the Board of Directors by
Section 141(c) of the General Corporation Law of the State of Delaware, by the
By-Laws of the Corporation and by the resolutions of the Board of Directors
adopted at a meeting duly convened and held on January 20, 1998:
1. The Board of Directors on January 20, 1998 adopted, among other
resolutions, the following resolutions authorizing a Stock Committee of the
Board of Directors to act on behalf of the Board of Directors in connection with
the issuance of the Preferred Stock and fixing the voting rights of the
Preferred Stock:
"RESOLVED that the Stock Committee may, from time to time during the Stock
Committee Term, authorize the issuance and sale of securities which shall
consist of any or all of the following: (i) one or more series of the
Corporation's preferred stock, $1 par value per share (the "Preferred Stock");
(ii) depositary shares each representing a fraction of a share of Preferred
Stock or other security ("Depositary Shares"); (iii) warrants to purchase any
shares of Preferred Stock or Depositary Shares; (iv) warrants to purchase shares
of Common Stock; (v) any shares of Preferred Stock or Common Stock or other
securities into which or for which any of the foregoing may be exchangeable,
convertible, or issuable upon exercise, and (vi) any securities (or units or
combinations of securities)
(including, without limitation, any securities of an SPV (as defined below))
that the Corporation deems functionally equivalent to Preferred Stock by reason
of such securities (or units or combinations of securities) counting as "Tier 1
capital" of the Corporation according to the bank regulatory agencies (all of
the foregoing hereinafter collectively referred to as the "Preferred Shares"
unless the context shall otherwise require; and the Preferred Shares and Common
Stock hereinafter collectively referred to as "Securities", unless the context
shall otherwise require), for cash or other property, as shall be determined by
the Stock Committee, subject to the limitations hereinafter set forth, and any
such Preferred Shares may be sold through agents, through underwriters, through
dealers and directly to purchasers, in one or more offerings registered under
the Securities Act of 1933 (the "Act") or in transactions not required to be
registered under the Act, all as shall be determined by the Stock Committee; and
the Stock Committee shall have full authority to take any and all actions
necessary to effect the intent of this resolution; and all Preferred Shares so
issued will be deemed duly authorized, validly issued, fully paid and
nonassessable;
RESOLVED that, without limiting the generality of the preceding
resolution, the Stock Committee is hereby expressly authorized during the Stock
Committee Term:
(i) to determine whether the Preferred Shares will be issued in one
or more series and the number of shares of any such series;
(ii) to fix the dividend rate or rates of any such shares and/or the
methods of determining dividends and the dates on which dividends
shall be payable;
(iii) to determine whether dividends of any series of Preferred
Shares shall be cumulative or noncumulative and, if cumulative, the
dates from which dividends shall commence to cumulate;
(iv) to determine the conversion or exchange provisions, if any, of
the shares of any series of the Preferred Shares, including without
limitation, the class and series of capital stock or other
securities of the Corporation into which such shares shall be
convertible or exchangeable;
(v) to determine whether the Corporation shall elect to offer (a)
warrants for such Preferred Shares ("Warrants") or (b) Depositary
Shares evidenced by depositary receipts, each representing a
fraction (to be determined by the Stock Committee) of a share of a
particular series of the Preferred Stock or other securities, which
shares of Preferred Stock or other securities will be issued and
deposited with a depositary, in each case, in lieu of offering full
shares of such series of the Preferred Stock or other securities;
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(vi) to fix the liquidation preference of the shares of any series
of the Preferred Shares, subject to the limitation that the
aggregate liquidation preference over Common Stock of all the
Preferred Shares issued during the Stock Committee Term shall not
exceed $1.0 billion (the "Preferred Stock Maximum Amount");
(vii) to determine whether any warrants for Preferred Stock,
Depositary Shares or Common Stock shall be issued, whether alone or
in connection with any other Preferred Shares, and the terms and
conditions of any such warrants;
(viii) to determine whether the shares of any series of the
Preferred Shares shall be subject to redemption, optional or
mandatory or pursuant to a sinking fund, and, if such series shall
be subject to redemption, the redemption provisions of such series;
and
(ix) to fix or determine any additional dividend, liquidation,
redemption, sinking fund and other rights, preferences, privileges,
limitations and restrictions thereof;
RESOLVED that, if required, for any series of Preferred Stock, a
certificate shall be prepared and filed on behalf of the Corporation with the
Secretary of State of the State of Delaware pursuant to Section 151 of the
General Corporation Law of the State of Delaware (a "Certificate of
Designation"); that each such Certificate of Designation be in such form as is
approved by action of the Board of Directors or the Stock Committee; and that
the proper officers of the Corporation be and hereby are authorized to execute
and file each such Certificate of Designation pursuant to the General
Corporation Law of the State of Delaware;
RESOLVED that the Certificate of Designation for each series of the
Preferred Stock shall provide that the shares of such series shall not have any
voting powers either general or special, except that
(i) If at the time of any annual meeting of the Corporation's
stockholders for the election of directors there is a default in
preference dividends on the Preferred Stock, the number of directors
constituting the Board of Directors of the Corporation shall be increased
by two, and the holders of the Preferred Stock of all series (whether or
not the holders of such series of Preferred Stock would be entitled to
vote for the election of directors if such default in preference dividends
did not exist), shall have the right at such meeting, voting together as a
single class without regard to series, to the exclusion of the holders of
common stock, par value $1 per share, of the Corporation, to elect two
directors of the Corporation to fill such newly created directorships.
Such right shall continue until there are no dividends in arrears upon the
Preferred Stock. Each director elected by the holders of shares of
Preferred Stock (a "Preferred Director") shall continue to serve
3
as such director for the full term for which he or she shall have been
elected, notwithstanding that prior to the end of such term a default in
preference dividends shall cease to exist. Any Preferred Director may be
removed by, and shall not be removed except by, the vote of the holders of
record of the outstanding shares of Preferred Stock, voting together as a
single class without regard to series, at a meeting of the Corporation's
stockholders, or of the holders of shares of Preferred Stock, called for
the purpose. So long as a default in any preference dividends on the
Preferred Stock shall exist, (a) any vacancy in the office of a Preferred
Director may be filled (except as provided in the following clause (b)) by
an instrument in writing signed by the remaining Preferred Director and
filed with the Corporation and (b) in the case of the removal of any
Preferred Director, the vacancy may be filled by the vote of the holders
of the outstanding shares of Preferred Stock, voting together as a single
class without regard to series, at the same meeting at which such removal
shall be voted. Each director appointed as aforesaid by the remaining
Preferred Director shall be deemed, for all purposes hereof, to be a
Preferred Director. Whenever the term of office of the Preferred Directors
shall end and a default in preference dividends shall no longer exist, the
number of directors constituting the Board of Directors of the Corporation
shall be reduced by two. For the purposes hereof, a "default in preference
dividends" on the Preferred Stock shall be deemed to have occurred
whenever the amount of accrued dividends upon any series of the Preferred
Stock shall be equivalent to six full quarter-yearly dividends or more,
and, having so occurred, such default shall be deemed to exist thereafter
until, but only until, all accrued dividends on all shares of Preferred
Stock of each and every series then outstanding shall have been paid to
the end of the last preceding dividend period.
(ii) Without the consent of the holders of shares entitled to cast
at least two-thirds of the votes entitled to be cast by the holders of the
total number of shares of Preferred Stock then outstanding, voting as a
class without regard to series, the holders of shares of this series being
entitled to cast one vote per share thereon, the Corporation may not: (a)
create any class or series of stock which shall have preference as to
dividends or distribution of assets over any outstanding series of the
Preferred Stock other than a series which shall not have any right to
object to such creation or (b) alter or change the provisions of the
Corporation's Certificate of Incorporation so as to adversely affect the
voting power, preferences or special rights of the holders of Preferred
Stock; provided, however, that if such creation or such alteration or
change would adversely affect the voting power, preferences or special
rights of one or more, but not all, series of Preferred Stock at the time
outstanding, consent of the holders of shares entitled to cast at least
two-thirds of the votes entitled to be cast by the holders of all of the
shares of all such series so affected, voting as a class, shall be
required in lieu of the consent of the holders of shares entitled to cast
at least two-thirds of the votes entitled to be cast by the holders of the
total number of shares of Preferred Stock at the time outstanding.
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2. The Stock Committee of the Board of Directors on May 14, 1998, pursuant
to the authority conferred upon the Stock Committee of the Board of Directors by
Section 141(c) of the General Corporation Law of the State of Delaware, by
Section 3.03 of the By-Laws of the Corporation and by the resolutions of the
Board of Directors set forth above, adopted the following resolution:
"RESOLVED that, pursuant to resolutions of the Board of Directors of The
Chase Manhattan Corporation (the "Corporation") adopted on January 20, 1998, the
issue of 4,000,000 shares of Fixed/Adjustable Rate Noncumulative Preferred
Stock, $50 stated value per share ($1 par value), of the Corporation ranking on
a parity with the series of Preferred Stock of the Corporation designated as the
Corporation's: 10.96% Preferred Stock; 7-1/2% Cumulative Preferred Stock;
Adjustable Rate Cumulative Preferred Stock, Series L; 10-1/2% Cumulative
Preferred Stock; 9.76% Cumulative Preferred Stock; 10.84% Cumulative Preferred
Stock; and Adjustable Rate Cumulative Preferred Stock, Series N, is hereby
authorized and the designation, preferences and privileges, relative,
participating, optional and other special rights, and qualifications,
limitations and restrictions of all 4,000,000 shares of this Series, in addition
to those set forth in the Restated Certificate of Incorporation of the
Corporation and, with respect to voting rights, in the resolutions of the Board
of Directors of the Corporation adopted on January 20, 1998, are hereby fixed as
follows:
1. Designation. The designation of this Series shall be Fixed/Adjustable
Rate Noncumulative Preferred Stock (hereinafter referred to as this "Series"),
and the number of shares constituting this Series shall be 4,000,000. Shares of
this Series shall have a stated value of $50. The number of authorized shares of
this Series may be reduced by further resolution duly adopted by the Board of
Directors of the Corporation, the Stock Committee of the Board of Directors or
by any other duly authorized committee of the Board of Directors (collectively,
the "Board of Directors") and by the filing of a certificate pursuant to the
provisions of the General Corporation Law of the State of Delaware stating that
such reduction has been so authorized, but the number of authorized shares of
this Series shall not be increased.
2. Dividends. (a) The holders of shares of this Series shall be entitled
to receive cash dividends, when, as and if declared by the Board of Directors,
out of funds legally available for that purpose, in the amounts or at the rate
set forth below in this Section 2. Dividends on the shares of this Series shall
be payable, when, as and if declared by the Board of Directors, on March 31,
June 30, September 30 and December 31 of each year (each, a "Dividend Payment
Date"), commencing on September 30, 1998. Each such dividend shall be paid to
the holders of record of shares of this Series as they appear on the stock
register of the Corporation on such record date, not more than 45 days preceding
the payment date thereof, as shall be fixed by the Board of Directors. Dividends
on the shares of this Series shall not be cumulative and no rights shall accrue
to the holders of the shares of this Series if the Corporation fails to declare
a dividend on the shares of this Series with respect to any Dividend Period (as
hereinafter defined), whether or not dividends are declared with respect to any
future Dividend Period.
5
(b) Dividends payable on the shares of this Series for the period from May
21, 1998 through and including September 30, 1998 (the "Initial Dividend
Period") shall be $0.9024 per share. For each quarterly dividend period after
the Initial Dividend Period (each such quarterly dividend period and the Initial
Dividend Period being hereinafter referred to individually as a "Dividend
Period") through and including the Dividend Period ending June 30, 2003,
dividends payable on the shares of this Series shall be payable at a rate per
annum of the stated value thereof equal to 4.96%. For each Dividend Period
beginning on or after July 1, 2003, dividends payable on the shares of this
Series shall be payable at a rate per annum of the stated value thereof equal to
the Applicable Rate (as defined in Section 3) in respect of such Dividend
Period, expressed as a percentage to the nearest ten thousandth of a percentage
point. The amount of dividends per share for each Dividend Period shall be
computed by dividing the Applicable Rate for such Dividend Period by four and
applying the resulting rate to the stated value per share of this Series. Each
Dividend Period (other than the Initial Dividend Period) shall commence on the
January 1, April 1, July 1 and October 1, as the case may be, following the last
day of the Initial Dividend Period or the preceding Dividend Period, as the case
may be, and shall end on and include the day next preceding the first day of the
next such Dividend Period.
(c) Dividends payable on this Series for any period greater or less than a
full Dividend Period, other than the Initial Dividend Period, shall be computed
on the basis of a 360-day year consisting of twelve 30-day months and, for any
period less than one month, the actual number of days elapsed in the period.
(d) No full dividends shall be declared or paid or set apart for payment
on the Preferred Stock of any series ranking, as to dividends, on a parity with
or junior to this Series for any period unless full dividends on the shares of
this Series for the Dividend Period commencing on the day following the
immediately preceding Dividend Payment Date have been or contemporaneously are
declared and paid or declared and a sum sufficient for the payment thereof set
apart for such payment. When dividends are not paid in full, as aforesaid, upon
the shares of this Series and any other series of Preferred Stock ranking on a
parity as to dividends with this Series, all dividends declared upon shares of
this Series and any other series of Preferred Stock ranking on a parity as to
dividends with this Series shall be declared pro rata so that the amount of
dividends declared per share on this Series and such other Preferred Stock shall
in all cases bear to each other the same ratio that accrued and unpaid dividends
per share (which in the case of this Series shall include accrued and unpaid
dividends for the Dividend Period commencing on the day following the
immediately preceding Dividend Payment Date but shall not include accumulation
of any dividends for prior Dividend Periods, unless previously declared) on the
shares of this Series and such other Preferred Stock bear to each other. No
interest, or sum of money in lieu of interest, shall be payable in respect of
any dividend payment or payments on this Series which may be in arrears.
(e) So long as any shares of this Series are outstanding, no dividend
(other than a dividend in Common Stock or in any other stock ranking junior to
this Series as to
6
dividends and upon liquidation and other than as provided in paragraph (d) of
this Section 2) shall be declared or paid or set aside for payment or other
distribution declared or made upon the Common Stock or upon any other stock
ranking junior to or on a parity with this Series as to dividends or upon
liquidation, nor shall any Common Stock or any other stock of the Corporation
ranking junior to or on a parity with this Series as to dividends or upon
liquidation be redeemed, purchased or otherwise acquired for any consideration
(or any moneys be paid to or made available for a sinking fund for the
redemption of any shares of any such stock) by the Corporation (except by
conversion into or exchange for stock of the Corporation ranking junior to this
Series as to dividends and upon liquidation), unless, in each case, full
dividends on all outstanding shares of this Series shall have been paid or
declared and set aside for payment in respect of the Dividend Period commencing
on the day following the immediately preceding Dividend Payment Date.
3. Definition of Applicable Rate, etc. (a) Except as provided below in
this paragraph, the "Applicable Rate" for any Dividend Period beginning on or
after July 1, 2003 shall be equal to the Effective Rate (as hereinafter defined)
less 0.20%. The "Effective Rate" for any Dividend Period beginning on or after
July 1, 2003 shall be equal to the highest of the Treasury Bill Rate, the Ten
Year Constant Maturity Rate and the Thirty Year Constant Maturity Rate (each as
hereinafter defined) for such Dividend Period. In the event that the Corporation
determines in good faith that for any reason:
(i) any one of the Treasury Bill Rate, the Ten Year Constant
Maturity Rate or the Thirty Year Constant Maturity Rate cannot be determined for
any Dividend Period beginning on or after July 1, 2003, then the Effective Rate
for such Dividend Period shall be equal to the higher of whichever two of such
rates can be so determined;
(ii) only one of the Treasury Bill Rate, the Ten Year Constant
Maturity Rate or the Thirty Year Constant Maturity Rate can be determined for
any Dividend Period beginning on or after July 1, 2003, then the Effective Rate
for such Dividend Period shall be equal to whichever such rate can be so
determined; or
(iii) none of the Treasury Bill Rate, the Ten Year Constant Maturity
Rate or the Thirty Year Constant Maturity Rate can be determined for any
Dividend Period beginning on or after July 1, 2003, then the Effective Rate for
the preceding Dividend Period shall be continued for such Dividend Period.
Anything herein to the contrary notwithstanding, the Applicable Rate for
any Dividend Period shall in no event be less than 5.46% per annum or greater
than 11.46% per annum (without taking into account adjustments described in
paragraph 3(h) below).
(b) Except as described below in this paragraph, the "Treasury Bill Rate"
for each applicable Dividend Period shall be the arithmetic average of the two
most recent weekly per annum market discount rates (or the one weekly per annum
market discount rate, if only one such rate is published during the relevant
Calendar Period (as hereinafter defined)) for three-month U.S. Treasury bills,
as published weekly by the Federal Reserve
7
Board (as hereinafter defined) during the Calendar Period immediately preceding
the last ten calendar days preceding the Dividend Period for which the dividend
rate on this Series is being determined. In the event that the Federal Reserve
Board does not publish such a weekly per annum market discount rate during such
Calendar Period, then the Treasury Bill Rate for such Dividend Period shall be
the arithmetic average of the two most recent weekly per annum market discount
rates (or the one weekly per annum market discount rate, if only one such rate
is published during the relevant Calendar Period) for three-month U.S. Treasury
bills, as published weekly during such Calendar Period by any Federal Reserve
Bank or by any U.S. Government department or agency selected by the Corporation.
In the event that a per annum market discount rate for three-month U.S. Treasury
bills is not published by the Federal Reserve Board or by any Federal Reserve
Bank or by any U.S. Government department or agency during such Calendar Period,
then the Treasury Bill Rate for such Dividend Period shall be the arithmetic
average of the two most recent weekly per annum market discount rates (or the
one weekly per annum market discount rate, if only one such rate is published
during the relevant Calendar Period) for all of the U.S. Treasury bills then
having remaining maturities of not less than 80 nor more than 100 days, as
published during such Calendar Period by the Federal Reserve Board or, if the
Federal Reserve Board does not publish such rates, by any Federal Reserve Bank
or by any U.S. Government department or agency selected by the Corporation. In
the event that the Corporation determines in good faith that for any reason no
such U.S. Treasury bill rates are published as provided above during such
Calendar Period, then the Treasury Bill Rate for such Dividend Period shall be
the arithmetic average of the per annum market discount rates based upon the
closing bids during such Calendar Period for each of the issues of marketable
non-interest-bearing U.S. Treasury securities with a remaining maturity of not
less than 80 nor more than 100 days from the date of each such quotation, as
chosen and quoted daily for each business day in New York City (or less
frequently if daily quotations are not generally available) to the Corporation
by at least three recognized dealers in U.S. Government securities selected by
the Corporation. In the event that the Corporation determines in good faith that
for any reason the Corporation cannot determine the Treasury Bill Rate for any
applicable Dividend Period as provided above in this paragraph, the Treasury
Bill Rate for such Dividend Period shall be the arithmetic average of the per
annum market discount rates based upon the closing bids during such Calendar
Period for each of the issues of marketable interest-bearing U.S. Treasury
securities with a remaining maturity of not less than 80 nor more than 100 days,
as chosen and quoted daily for each business day in New York City (or less
frequently if daily quotations are not generally available) to the Corporation
by at least three recognized dealers in U.S. Government securities selected by
the Corporation.
(c) Except as described below in this paragraph, the "Ten Year Constant
Maturity Rate" for each applicable Dividend Period shall be the arithmetic
average of the two most recent weekly per annum Ten Year Average Yields (as
hereinafter defined) (or the one weekly per annum Ten Year Average Yield, if
only one such yield is published during the relevant Calendar Period), as
published weekly by the Federal Reserve Board during the Calendar Period
immediately preceding the last ten calendar days preceding the Dividend
8
Period for which the dividend rate on this Series is being determined. In the
event that the Federal Reserve Board does not publish such a weekly per annum
Ten Year Average Yield during such Calendar Period, then the Ten Year Constant
Maturity Rate for such Dividend Period shall be the arithmetic average of the
two most recent weekly per annum Ten Year Average Yields (or the one weekly per
annum Ten Year Average Yield, if only one such yield is published during the
relevant Calendar Period), as published weekly during such Calendar Period by
any Federal Reserve Bank or by any U.S. Government department or agency selected
by the Corporation. In the event that a per annum Ten Year Average Yield is not
published by the Federal Reserve Board or by any Federal Reserve Bank or by any
U.S. Government department or agency during such Calendar Period, then the Ten
Year Constant Maturity Rate for such Dividend Period shall be the arithmetic
average of the two most recent weekly per annum average yields to maturity (or
the one weekly per annum average yield to maturity, if only one such yield is
published during the relevant Calendar Period) for all of the actively traded
marketable U.S. Treasury fixed interest rate securities (other than Special
Securities (as hereinafter defined)) then having remaining maturities of not
less than eight nor more than twelve years, as published during such Calendar
Period by the Federal Reserve Board or, if the Federal Reserve Board does not
publish such yields, by any Federal Reserve Bank or by any U.S. Government
department or agency selected by the Corporation. In the event that the
Corporation determines in good faith that for any reason the Corporation cannot
determine the Ten Year Constant Maturity Rate for any applicable Dividend Period
as provided above in this paragraph, then the Ten Year Constant Maturity Rate
for such Dividend Period shall be the arithmetic average of the per annum
average yields to maturity based upon the closing bids during such Calendar
Period for each of the issues of actively traded marketable U.S. Treasury fixed
interest rate securities (other than Special Securities) with a final maturity
date not less than eight nor more than twelve years from the date of each such
quotation, as chosen and quoted daily for each business day in New York City (or
less frequently if daily quotations are not generally available) to the
Corporation by at least three recognized dealers in U.S. Government securities
selected by the Corporation.
(d) Except as described below in this paragraph, the "Thirty Year Constant
Maturity Rate" for each applicable Dividend Period shall be the arithmetic
average of the two most recent weekly per annum Thirty Year Average Yields (as
hereinafter defined) (or the one weekly per annum Thirty Year Average yield, if
only one such yield is published during the relevant Calendar Period), as
published weekly by the Federal Reserve Board during the Calendar Period
immediately preceding the last ten calendar days preceding the Dividend Period
for which the dividend rate on this Series is being determined. In the event
that the Federal Reserve Board does not publish such a weekly per annum Thirty
Year Average Yield during such Calendar Period, then the Thirty Year Constant
Maturity Rate for such Dividend Period shall be the arithmetic average of the
two most recent weekly per annum Thirty Year Average Yields (or the one weekly
per annum Thirty Year Average Yield, if only one such yield is published during
the relevant Calendar Period), as published weekly during such Calendar Period
by any Federal Reserve Bank or by any U.S. Government department or agency
selected by the
9
Corporation. In the event that a per annum Thirty Year Average Yield is not
published by the Federal Reserve Board or by any Federal Reserve Bank or by any
U.S. Government department or agency during such Calendar Period, then the
Thirty Year Constant Maturity Rate for such Dividend Period shall be the
arithmetic average of the two most recent weekly per annum average yields to
maturity (or the one weekly per annum average yield to maturity, if only one
such yield is published during the relevant Calendar Period) for all of the
actively traded marketable U.S. Treasury fixed interest rate securities (other
than Special Securities) then having remaining maturities of not less than
twenty-eight nor more than thirty years, as published during such Calendar
Period by the Federal Reserve Board or, if the Federal Reserve Board does not
publish such yields, by any Federal Reserve Bank or by any U.S. Government
department or agency selected by the Corporation. In the event that the
Corporation determines in good faith that for any reason the Corporation cannot
determine the Thirty Year Constant Maturity for any applicable Dividend Period
as provided above in this paragraph, the Thirty Year Constant Maturity Rate for
such Dividend Period shall be the arithmetic average of the per annum average
yields to maturity based upon the closing bids during such Calendar Period for
each of the issues of actively traded marketable U.S. Treasury fixed interest
rate securities (other than Special Securities) with a final maturity date not
less than twenty-eight nor more than thirty years from the date of each such
quotation, as chosen and quoted daily for each business day in New York City (or
less frequently if daily quotations are not generally available) to the
Corporation by at least three recognized dealers in U.S. Government securities
selected by the Corporation.
(e) The Treasury Bill Rate, the Ten Year Constant Maturity Rate and the
Thirty Year Constant Maturity Rate shall each be rounded to the nearest five
hundredths of a percent.
(f) The Applicable Rate with respect to each Dividend Period beginning on
or after July 1, 2003 shall be calculated as promptly as practicable by the
Corporation according to the appropriate method described above. The Corporation
shall cause notice of each Applicable Rate to be sent to the holders of this
Series.
(g) For purposes of this Section,
(i) "Calendar Period" means a period of fourteen calendar days;
(ii) "Federal Reserve Board" means the Board of Governors of the
Federal Reserve System;
(iii) "Special Securities" means securities which can, at the option
of the holder, be surrendered at face value in payment of any Federal
estate tax or which provide tax benefits to the holder and are priced to
reflect such tax benefits or which were originally issued at a deep or
substantial discount;
10
(iv) "Ten Year Average Yield" means the average yield to maturity
for actively traded marketable U.S. Treasury fixed interest rate
securities (adjusted to constant maturities of ten years); and
(v) "Thirty Year Average Yield" means the average yield to maturity
for actively traded marketable U.S. Treasury fixed interest rate
securities (adjusted to constant maturities of thirty years).
(h) If, prior to November 21, 1999, one or more amendments to the Internal
Revenue Code of 1986, as amended (the "Code"), are enacted that reduce the
percentage of the dividends-received deduction (currently 70%) as specified in
section 243(a)(1) of the Code or any successor provision (the
"Dividends-Received Percentage"), the amount of each dividend payable (if
declared) per share of this Series for dividend payments made on or after the
effective date of such change in the Code shall be adjusted by multiplying the
amount of the dividend payable described above (before adjustment) by the
following fraction (the "DRD Formula"), and rounding the result to the nearest
cent (with one-half cent rounded up):
1- [.35(1-.70)]
---------------
1- [.35(1-DRP)]
For the purposes of the DRD Formula, "DRP" means the Dividends-Received
Percentage (expressed as a decimal) applicable to the dividend in question;
provided, however, that if the Dividends-Received Percentage applicable to the
dividend in question shall be less than 50%, then the DRP shall equal 0.50.
Notwithstanding the foregoing provisions, if, with respect to any such
amendment, the Corporation receives either an unqualified opinion of nationally
recognized independent tax counsel selected by the Corporation or a private
letter ruling or similar form of authorization from the Internal Revenue Service
("IRS") to the effect that such amendment does not apply to a dividend payable
on this Series, then such amendment shall not result in the adjustment provided
for pursuant to the DRD Formula with respect to such dividend. Such opinion
shall be based upon the legislation amending or establishing the DRP or upon a
published pronouncement of the IRS addressing such legislation.
If any such amendment to the Code is enacted after the dividend payable on
a Dividend Payment Date has been declared, the amount of the dividend payable on
such Dividend Payment Date shall not be increased; instead, additional dividends
(the "Post Declaration Date Dividends") equal to the excess, if any, of (x) the
product of the dividend paid by the Corporation on such Dividend Payment Date
and the DRD Formula (where the DRP used in the DRD Formula would be equal to the
greater of the Dividends-Received Percentage and 0.50) applicable to the
dividend in question over (y) the dividend paid by the Corporation on such
Dividend Payment Date, shall be payable (if declared) to holders of shares of
this Series on the record date applicable to the next succeeding Dividend
Payment Date or, if the shares of this Series are called for redemption prior to
such record date, to holders of shares of this Series on the applicable
redemption date, as
11
the case may be, in addition to any other amounts payable on such date.
Notwithstanding the foregoing provisions, if, with respect to any such
amendment, the Corporation receives either an unqualified opinion of nationally
recognized independent tax counsel selected by the Corporation or a private
letter ruling or similar form of authorization from the IRS to the effect that
such amendment does not apply to a dividend so payable on this Series, then such
amendment shall not result in the payment of Post Declaration Date Dividends.
The opinion referenced in the previous sentence shall be based upon the
legislation amending or establishing the DRP or upon a published pronouncement
of the IRS addressing such legislation.
If any such amendment to the Code is enacted and the reduction in the
Dividends-Received Percentage retroactively applies to a Dividend Payment Date
as to which the Corporation previously paid dividends on this Series (each, an
"Affected Dividend Payment Date"), the Corporation shall pay (if declared)
additional dividends (the "Retroactive Dividends") to holders of shares of this
Series on the record date applicable to the next succeeding Dividend Payment
Date (or, if such amendment is enacted after the dividend payable on such
Dividend Payment Date has been declared, to holders of shares of this Series on
the record date following the date of enactment) or, if the shares of this
Series are called for redemption prior to such record date, to holders of shares
of this Series on the applicable redemption date, as the case may be, in an
amount equal to the excess of (x) the product of the dividend paid by the
Corporation on each Affected Dividend Payment Date and the DRD Formula (where
the DRP used in the DRD Formula would be equal to the greater of the
Dividends-Received Percentage and 0.50) applied to each Affected Dividend
Payment Date over (y) the sum of the dividends paid by the Corporation on each
Affected Dividend Payment Date. The Corporation shall only make one payment of
Retroactive Dividends for any such amendment. Notwithstanding the foregoing
provisions, if, with respect to any such amendment, the Corporation receives
either an unqualified opinion of nationally recognized independent tax counsel
selected by the Corporation or a private letter ruling or similar form of
authorization from the IRS to the effect that such amendment does not apply to a
dividend so payable on this Series, then such amendment shall not result in the
payment of Retroactive Dividends. The opinion referenced in the previous
sentence shall be based upon the legislation amending or establishing the DRP or
upon a published pronouncement of the IRS addressing such legislation.
Notwithstanding the foregoing, no adjustment in the dividends payable by
the Corporation shall be made, and no Post Declaration Date Dividends or
Retroactive Dividends shall be payable by the Corporation, in respect of the
enactment of any amendment to the Code at any time on or after November 21, 1999
that reduces the Dividends-Received Percentage.
In the event that the amount of dividends payable per share of the shares
of this Series is adjusted pursuant to the DRD Formula and/or Post Declaration
Date Dividends or Retroactive Dividends are to be paid, the Corporation shall
give notice of each such
12
adjustment and, if applicable, any Post Declaration Date Dividends and
Retroactive Dividends to the holders of shares of this Series.
4. Redemption. (a) Except as provided in paragraph (b) below, the shares
of this Series are not redeemable prior to June 30, 2003. The Corporation, at
its option, may redeem shares of this Series, as a whole or in part, at any time
or from time to time, on or after June 30, 2003 at a redemption price of $50 per
share plus accrued and unpaid dividends thereon (whether or not declared and
including any increase in dividends pursuant to paragraph 3(h) above) from the
immediately preceding Dividend Payment Date to the date fixed for redemption
(but without any accumulation for unpaid dividends for prior Dividend Periods on
the shares of this Series).
(b) If the Dividends-Received Percentage is equal to or less than 50% and,
as a result, the amount of dividends payable on this Series on any Dividend
Payment Date shall be or is adjusted upwards as described in paragraph 3(h)
above, the Company, at its option, may redeem all, but not less than all, of the
outstanding shares of this Series, provided that within sixty days of the date
on which an amendment to the Code is enacted which reduces the
Dividends-Received Percentage to 50% or less, the Company sends notice to
holders of shares of this Series of such redemption in accordance with paragraph
(d) below. Any redemption of this Series in accordance with this paragraph shall
be on notice as aforesaid at a redemption price equal to $51 per share, plus
accrued and unpaid dividends (whether or not declared and including any increase
in dividends pursuant to paragraph 3(h) above) from the immediately preceding
Dividend Payment Date to the date fixed for redemption (but without any
accumulation for unpaid dividends for prior Dividend Periods on the shares of
this Series).
(c) In the event that fewer than all the outstanding shares of this Series
are to be redeemed, the number of shares to be redeemed shall be determined by
the Board of Directors and the shares to be redeemed shall be determined by lot
or pro rata as may be determined by the Board of Directors or by any other
method as may be determined by the Board of Directors in its sole discretion to
be equitable, provided that such method satisfies any applicable requirements of
any securities exchange on which this Series is listed.
(d) In the event the Corporation shall redeem shares of this Series,
notice of such redemption shall be given by first class mail, postage prepaid,
mailed not less than 30 or more than 60 days prior to the redemption date, to
each holder of record of the shares to be redeemed, at such holder's address as
the same appears on the stock register of the Corporation. Each such notice
shall state: (i) the redemption date; (ii) the number of shares of this Series
to be redeemed and, if fewer than all the shares held by such holder are to be
redeemed, the number of such shares to be redeemed from such holder; (iii) the
redemption price; (iv) the place or places where certificates for such shares
are to be surrendered for payment of the redemption price; and (v) that
dividends on the shares to be redeemed shall cease to accrue on the redemption
date.
13
(e) Notice having been mailed as aforesaid, from and after the redemption
date (unless default shall be made by the Corporation in providing money for the
payment of the redemption price) dividends on the shares of this Series so
called for redemption shall cease to accrue, and said shares shall no longer be
deemed to be outstanding, and all rights of the holders thereof as stockholders
of the Corporation (except the right to receive from the Corporation the
redemption price) shall cease. Upon surrender in accordance with said notice of
the certificates for any shares so redeemed (properly endorsed or assigned for
transfer, if the Board of Directors shall so require and the notice shall so
state), such shares shall be redeemed by the Corporation at the redemption price
aforesaid. In case fewer than all the shares represented by any such certificate
are redeemed, a new certificate shall be issued representing the unredeemed
shares without cost to the holder thereof.
(f) Any shares of this Series which shall at any time have been redeemed
shall, after such redemption, have the status of authorized but unissued shares
of Preferred Stock, without designation as to series until such shares are once
more designated as part of a particular series by the Board of Directors.
(g) Notwithstanding the foregoing provisions of this Section 4, if full
dividends on all outstanding shares of this Series are in arrears, no shares of
this Series shall be redeemed unless all outstanding shares of this Series are
simultaneously redeemed, and the Corporation shall not purchase or otherwise
acquire any shares of this Series; provided, however, that the foregoing shall
not prevent the purchase or acquisition of shares of this Series pursuant to a
purchase or exchange offer made on the same terms to holders of all outstanding
shares of this Series.
5. Conversion. The holders of shares of this Series shall not have any
rights to convert such shares into shares of any other class or series of
capital stock of the Corporation.
6. Liquidation Rights. (a) Upon the voluntary or involuntary dissolution,
liquidation or winding up of the Corporation, the holders of the shares of this
Series shall be entitled to receive and to be paid out of the assets of the
Corporation available for distribution to its stockholders, before any payment
or distribution shall be made on the Common Stock or on any other class of stock
ranking junior to this Series upon liquidation, the amount of $50 per share,
plus accrued and unpaid dividends (whether or not declared and including any
increase in dividends pursuant to paragraph 3(h) above) from the immediately
preceding Dividend Payment Date or the date of original issuance of this Series,
as the case may be, to the date of the liquidating distribution (but without any
accumulation of unpaid dividends for prior Dividend Periods) .
(b) After the payment to the holders of the shares of this Series of the
full preferential amounts provided for in this Section 6, the holders of this
Series as such shall have no right or claim to any of the remaining assets of
the Corporation.
14
(c) If, upon any voluntary or involuntary dissolution, liquidation, or
winding up of the Corporation, the amounts payable with respect to the shares of
this Series and any other shares of stock of the Corporation ranking as to any
such distribution on a parity with the shares of this Series are not paid in
full, the holders of the shares of this Series and of such other shares shall
share ratably in any such distribution of assets of the Corporation in
proportion to the full respective distributions to which they are entitled.
(d) Neither the sale of all or substantially all the property or business
of the Corporation, nor the merger or consolidation of the Corporation into or
with any other corporation or the merger or consolidation of any other
corporation into or with the Corporation, shall be deemed to be a dissolution,
liquidation or winding up, voluntary or involuntary, for the purposes of this
Section 6.
7. Ranking. For purposes of this resolution, any stock of any class or
classes of the Corporation shall be deemed to rank:
(a) prior to the shares of this Series, either as to dividends or upon
liquidation, if the holders of such class or classes shall be entitled to the
receipt of dividends or of amounts distributable upon dissolution, liquidation
or winding up of the Corporation, as the case may be, in preference or priority
to the holders of shares of this Series;
(b) on a parity with shares of this Series, either as to dividends or upon
liquidation, whether or not the dividend rates, dividend payment dates or
redemption or liquidation prices per share or sinking fund provisions, if any,
be different from those of this Series (and whether or not such dividends shall
accumulate), if the holders of such stock shall be entitled to the receipt of
dividends or of amounts distributable upon dissolution, liquidation or winding
up of the Corporation, as the case may be, without preference or priority, one
over the other, as between the holders of such stock and the holders of shares
of this Series; and
(c) junior to shares of this Series, either as to dividends or upon
liquidation, if such class shall be Common Stock or if the holders of shares of
this Series shall be entitled to receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the Corporation, as
the case may be, in preference or priority to the holders of shares of such
class or classes.
8. Voting Rights. The shares of this Series shall have the voting rights
set forth in the resolutions of the Board of Directors of the Corporation
adopted on January 20, 1998."
[Signature appears on subsequent page.]
15
IN WITNESS WHEREOF, The Chase Manhattan Corporation has caused its
corporate seal to be hereunto affixed and this Certificate to be signed by its
Corporate Secretary, Anthony J. Horan, this 19th day of May, 1998.
THE CHASE MANHATTAN CORPORATION
By: /s/Antony J. Horan
------------------------------
Corporate Secretary
The Chase Manhattan Corporation
270 Park Avenue
New York, New York 10017-2070
News Release
Investor Contact: John Borden Press Contacts: John Stefans
212-270-7318 212-270-7438
Kathleen Baum
For Immediate Release 212-270-5089
Chase Stockholders Approve a Two-for-One Stock Split
New York, May 19, 1998 -- The Chase Manhattan Corporation (NYSE:CMB) said
today that its stockholders have approved a 2-for-1 split of Chase common stock.
The record date for the split will be May 20, 1998, and the mail date for
the additional shares issued as a result of the split will be June 12, 1998. The
split will be reflected in trading beginning June 15, 1998.
The split had been approved by Chase's Board of Directors on March 17,
1998, subject to stockholder approval, which was obtained today.
# # #