<PAGE> 1
Filed pursuant to Rule 424(b)(5)
Registration No. 33-58144
PROSPECTUS SUPPLEMENT
- ---------------------
(TO PROSPECTUS DATED MARCH 2, 1993)
$150,000,000
[LOGO] THE CHASE MANHATTAN CORPORATION
8% SUBORDINATED NOTES DUE 2004
------------------------
Interest on the Notes is payable semi-annually on May 15 and November 15 of
each year, beginning November 15, 1994. The Notes will mature on May 15, 2004.
The Notes may not be redeemed prior to May 15, 1999 and will be redeemable on
such date and thereafter at the option of the Company, in whole or in part, at
their principal amount plus accrued interest. See "DESCRIPTION OF
NOTES--Redemption of Notes" in this Prospectus Supplement.
The Notes will be unsecured and will be subordinate to Senior Indebtedness
of the Company as described under "DESCRIPTION OF NOTES--Subordination" in this
Prospectus Supplement. At March 31, 1994, the outstanding Senior Indebtedness of
the Company, exclusive of guarantees and other contingent obligations of the
Company, was approximately $3.2 billion. Payment of principal of the Notes may
be accelerated only in case of the bankruptcy, insolvency or reorganization of
the Company. There is no right of acceleration upon a default in the payment of
interest on the Notes or in the performance of any covenant of the Company. See
"THE SUBORDINATED SECURITIES--Events of Default and Waiver Thereof" in the
accompanying Prospectus.
The Notes will be issued in fully registered form only in denominations of
$1,000 or integral multiples thereof. The Notes will be initially represented by
one or more global Notes registered in the name of The Depository Trust Company,
as Depository, or its nominee. Beneficial interests in Notes will be shown on,
and transfers thereof will be effected only through, records maintained by the
Depository and its participants. Owners of beneficial interests in Notes will be
entitled to physical delivery of Notes in certificated form equal in principal
amount to their respective beneficial interests only under the limited
circumstances described herein. See "DESCRIPTION OF NOTES--Book-Entry Notes" in
this Prospectus Supplement. Settlement for the Notes will be made in immediately
available funds. The Notes will trade in the Depository's Same-Day Funds
Settlement System until maturity, and secondary market trading activity for the
Notes will therefore settle in immediately available funds. All payments of
principal and interest will be made by the Company in immediately available
funds. See "DESCRIPTION OF NOTES--Same-Day Settlement and Payment" in this
Prospectus Supplement. Application will be made to list the Notes on the New
York Stock Exchange. Listing will be subject to meeting the requirements of such
Exchange, including those related to distribution.
------------------------
THE NOTES ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR OTHER OBLIGATIONS OF ANY BANK
OR NON-BANK SUBSIDIARY OF THE COMPANY AND ARE NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION, BANK INSURANCE
FUND OR ANY OTHER GOVERNMENT AGENCY.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS
SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC(1) DISCOUNT(2) COMPANY(1)(3)
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Note.......................................... 99.455% .604% 98.851%
- ----------------------------------------------------------------------------------------------------------
Total............................................. $149,182,500 $906,000 $148,276,500
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
<FN>
(1) Plus accrued interest from May 15, 1994.
(2) The Company has agreed to indemnify the Underwriter against certain
liabilities, including liabilities under the Securities Act of 1933. See
"UNDERWRITING" in this Prospectus Supplement.
(3) Before deducting expenses payable by the Company estimated to be $150,000.
</TABLE>
------------------------
The Notes are offered by the Underwriter, subject to prior sale, when, as
and if issued to and accepted by it, subject to approval of certain legal
matters by counsel for the Underwriter and certain other conditions. The
Underwriter reserves the right to withdraw, cancel or modify such offer and to
reject orders in whole or in part. It is expected that delivery of the Notes
will be made in New York, New York on or about May 25, 1994.
This Prospectus Supplement and the accompanying Prospectus may be used by
Chase Securities, Inc., a wholly-owned subsidiary of the Company, in connection
with offers and sales related to market-making transactions in the Notes. Chase
Securities, Inc. may act as principal or agent in such transactions. Such sales
will be made at prices related to prevailing market prices at the time of sale.
------------------------
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
------------------------
The date of this Prospectus Supplement is May 18, 1994.
<PAGE> 2
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OFFERED
HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH TRANSACTIONS MAY BE EFFECTED IN THE OVER-THE-COUNTER MARKET OR OTHERWISE.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
------------------------
RECENT DEVELOPMENTS
Notwithstanding anything to the contrary in the accompanying Prospectus,
the Notes offered hereby will be issued under the Amended and Restated
Indenture, dated as of September 1, 1993, between the Company and Chemical Bank,
as Trustee, and all references herein and in the accompanying Prospectus to the
"Subordinated Indenture" and the "Indentures" shall be deemed to refer to such
Amended and Restated Indenture. Such Amended and Restated Indenture was filed as
an exhibit to the Company's Current Report on Form 8-K dated August 19, 1993.
INTERIM RESULTS
The following is a summary of the information contained in the Company's
Quarterly Report on Form 10-Q for the quarter ended March 31, 1994, which report
is incorporated herein by reference. As used herein, the term "Corporation"
means the Company and its consolidated subsidiaries.
FIRST QUARTER 1994 EARNINGS
The Corporation reported first quarter 1994 net income of $364 million
($1.80 per share), up 138% from the $153 million ($.74 per share) reported for
the first quarter of 1993.
Net Interest Revenue -- Taxable Equivalent Basis
Net interest revenue, on a taxable equivalent basis, was $958 million for
the first quarter of 1994, compared with $1,056 million for the first quarter of
1993. Excluding first quarter 1993 interest revenue of $142 million from the
sale of Brazilian past due interest (PDI) bonds, net interest revenue for the
first quarter of 1994 increased by $44 million, or 5%, from the same period last
year.
The net interest margin was 4.17% for the first quarter of 1994, compared
with 4.94% (4.28% excluding Brazilian PDI bonds) reported for the first quarter
of 1993. Average interest-earning assets were $93.1 billion for the first
quarter of 1994, compared with $86.7 billion for the first quarter of 1993.
Average loans decreased to $61.3 billion for the first quarter of 1994 from the
$62.1 billion level reported for the first quarter of 1993, primarily due to the
reductions in commercial real estate and refinancing countries loans, which were
partially offset by increases in consumer loans.
Other Operating Revenue
Total other operating revenue for the first quarter of 1994 was $853
million, compared with $658 million for the first quarter of 1993, primarily due
to higher levels of fee revenue, accelerated disposition portfolio gains and
investment securities gains.
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<PAGE> 3
Total trading revenue for the first quarter of 1994 was $179 million,
slightly higher than the $175 million reported for the first quarter of 1993.
The Corporation experienced generally good customer demand for derivative
products and foreign exchange transactions. In addition, substantial revenue was
realized in the earlier part of the quarter from reducing emerging markets
trading positions, partially offset by the effects of the decline in market
values during the latter part of the quarter.
Total fees and commissions for the first quarter of 1994 were $446 million,
compared with $367 million for the first quarter of 1993. This increase of 22%
reflects increases in all categories of fee revenue. Total consumer banking
fees, including credit card and mortgage banking fees, were $144 million for the
first quarter of 1994, an increase of 23% over the $117 million reported for the
first quarter of 1993. During the first quarter of 1994, mortgage interest rates
continued to increase, resulting in a significant decline in refinancing
activity compared with the high level experienced in 1993. As a result, there
were no accelerated writedowns of mortgage servicing assets for the first
quarter of 1994 compared with $34 million for the first quarter of 1993. Fee
revenue from trust and fiduciary activities was $142 million for the first
quarter of 1994, compared with $107 million for the first quarter of 1993. This
increase of 33% was primarily due to increased transaction volume and continued
growth in trust and custody assets. Investment banking fee revenue from global
corporate finance activities increased 24% to $47 million in the first quarter
of 1994 over the $38 million reported for the same period last year due to
improved transaction volume.
Other revenue for the first quarter of 1994 was $228 million, compared with
$116 million for the first quarter of 1993. This increase was primarily due to
the further liquidation of real estate assets held for accelerated disposition
and sales of Brady bonds in the investment securities available for sale
portfolio which yielded gains of $53 million and $71 million, respectively, and
continued strong corporate finance-related equity gains.
Other Operating Expenses
Total operating expenses were $1,057 million for the first quarter of 1994
and $1,301 million for the first quarter of 1993, which included a $318 million
provision for selected real estate properties acquired in satisfaction of loans,
including loans classified as in-substance foreclosures ("ORE") held for
accelerated disposition. Operating expenses for the first quarter of 1994
included $8 million applicable to the second quarter 1993 acquisition of Troy
and Nichols, Inc. and $37 million of ORE expenses, including valuation losses,
compared to $38 million for the first quarter of 1993. In addition, first
quarter 1994 other operating expenses reflected the cost of funding business
growth opportunities, particularly in the Corporation's global trading and
capital markets activities, global securities servicing and national consumer
products. Salaries and employee benefits also increased as a result of increased
compensation accruals related to higher earnings.
Income Taxes
The provision for income taxes for the first quarter of 1994 was $223
million, compared with a net income tax benefit of $174 million recorded in the
first quarter of 1993. Excluding the tax benefits applicable to the special
provisions for the accelerated disposition portfolio, the Corporation's first
quarter 1993 tax provision would have been approximately $137 million. In
addition, in the first quarter of 1993, the Corporation adopted Statement of
Financial Accounting Standards No. 109, Accounting for Income Taxes, which
resulted in a $500 million net benefit reflected as a cumulative effect of a
change in accounting principle.
Provision for Possible Credit Losses and Net Loan Charge-Offs
The provision for possible credit losses for the first quarter 1994 was
$160 million, compared with $360 million for the first quarter of 1993,
excluding the accelerated disposition portfolio.
Net loan charge-offs (excluding the accelerated disposition portfolio) for
the first quarter of 1994 were $156 million, down $64 million from the $220
million for the first quarter of 1993. Domestic consumer net loan charge-offs
for the first quarter of 1994 were $94 million, compared with $103 million for
the first quarter of 1993. Domestic commercial real estate net loan charge-offs
(excluding the accelerated disposition
S-3
<PAGE> 4
portfolio) for the first quarter of 1994 were $51 million, compared with $91
million for the first quarter of 1993.
Reserve for Possible Credit Losses
At March 31, 1994, the reserve for possible credit losses was $1,429
million, or 2.32% of total loans and 134% of nonaccrual loans (excluding the
accelerated disposition portfolio), compared with $1,912 million, or 3.21% of
total loans and 67% of nonaccrual loans (excluding the accelerated disposition
portfolio) at March 31, 1993.
Nonaccrual Outstandings and ORE
At March 31, 1994 and 1993, total nonaccrual outstandings (excluding the
accelerated disposition portfolio) were $1,068 million and $2,856 million,
respectively, of which $469 million and $1,061 million, respectively, were
domestic commercial real estate outstandings and $69 million and $996 million,
respectively, were cross-border outstandings to borrowers in refinancing
countries. Total domestic ORE (excluding the accelerated disposition portfolio)
totaled $810 million at March 31, 1994, compared with $738 million at March 31,
1993.
Domestic Commercial Real Estate Loans
Total domestic commercial real estate loans (excluding ORE and the
accelerated disposition portfolio) decreased to $2.8 billion at March 31, 1994
from $4.6 billion at March 31, 1993. At March 31, 1994 and March 31, 1993,
commercial real estate assets held for accelerated disposition were $121 million
and $1,024 million, respectively.
S-4
<PAGE> 5
SUMMARY FINANCIAL DATA
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31,
----------------------
1994 1993
-------- -------
(DOLLARS IN MILLIONS,
EXCEPT PER SHARE
AMOUNTS)
(UNAUDITED)
<S> <C> <C>
Statement of Income Information:
Net interest revenue................................................ $ 951 $ 1,048
Less: Provision for possible credit losses.......................... 160 360
Less: Provision for loans held for accelerated disposition.......... -- 566
-------- -------
Net interest revenue after provisions for possible credit losses and
loans
held for accelerated disposition................................. 791 122
Total other operating revenue....................................... 853 658
Less: Provision for ORE held for accelerated disposition............ -- 318
Less: Other operating expenses...................................... 1,057 983
-------- -------
Income (loss) before taxes.......................................... 587 (521)
Applicable income taxes (benefits).................................. 223 (174)
-------- -------
Net income (loss) before cumulative effect of change in accounting
principle........................................................ 364 (347)
Cumulative effect of change in accounting principle -- adoption of
SFAS No. 109..................................................... -- 500
-------- -------
Net income.......................................................... $ 364 $ 153
-------- -------
-------- -------
Net income applicable to common stock............................... $ 333 $ 117
-------- -------
-------- -------
Average common shares outstanding (in millions)....................... 185.4 157.6
Per common share:
Earnings (loss) before cumulative effect of change in accounting
principle*....................................................... $ 1.80 $ (2.43)
Cumulative effect of change in accounting principle -- adoption of
SFAS No. 109*.................................................... -- 3.17
-------- -------
Earnings based on average shares outstanding........................ $ 1.80 $ 0.74
-------- -------
-------- -------
Cash dividends declared............................................. $ 0.33 $ 0.30
Statement of Condition Information:
Total assets........................................................ $112,592 $94,071
Total loans, net.................................................... 60,206 57,562
Total deposits...................................................... 68,626 64,753
Intermediate-and long-term debt..................................... 5,509 6,689
Common stockholders' equity......................................... 6,755 5,138
Total stockholders' equity.......................................... 8,154 6,787
Profitability Ratios:
Return on average common stockholders' equity....................... 20.15% 9.34%
Return on average assets............................................ 1.28 0.62
Capital (period-end):
Common stockholders' equity as a % of total assets.................. 6.00%** 5.46%
Total stockholders' equity as a % of total assets................... 7.24** 7.21
Tier 1 capital as a % of net risk-weighted assets................... 8.43 7.10
Total capital as a % of net risk-weighted assets.................... 12.94 11.60
<FN>
- ---------------
* Based on average common shares outstanding.
** The common and total equity ratios decreased .59% and .71%, respectively,
from the adoption of Financial Accounting Standards Board Interpretation No.
39, Offsetting of Amounts Related to Certain Contracts, at January 1, 1994,
which resulted in an increase to the Trading Account Assets and Liabilities
of approximately $10 billion.
</TABLE>
S-5
<PAGE> 6
RATIOS OF EARNINGS TO FIXED CHARGES
The following are the consolidated ratios of earnings to fixed charges for
the Corporation for the three-month period ended March 31, 1994 and for each of
the years in the five-year period ended December 31, 1993:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH
31, YEAR ENDED DECEMBER 31,
------------ ------------------------------------------------
1994 1993 1992 1991 1990 1989
------------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Excluding Interest on
Deposits.................... 1.9x 1.3 x 1.4 x 1.3 x * *
Including Interest on
Deposits.................... 1.5 1.1 1.2 1.1 * *
<FN>
- ---------------
* For the years ended December 31, 1990 and 1989, earnings did not cover fixed
charges by $91 million and $449 million, respectively, primarily as a result
of large additions to the reserve for possible credit losses and special
charges.
</TABLE>
For purposes of computing the consolidated ratios, earnings represent net
income (loss) plus applicable income taxes and fixed charges, less cumulative
effect of change in accounting principle (for the year ended December 31, 1993)
and equity in undistributed earnings (losses) of unconsolidated subsidiaries and
associated companies. Fixed charges represent interest expense (exclusive of
interest on deposits in one case and inclusive of such interest in the other),
amortization of debt discount and issuance costs and one-third (the amount
deemed to represent an interest factor) of net rental expense under all lease
commitments.
CERTAIN REGULATORY MATTERS
Additional rules and regulations have been promulgated under the Federal
Deposit Insurance Corporation Improvement Act of 1991. These relate to final
risk-based deposit insurance premium assessments and auditing and reporting
requirements. The Company expects that these rules and regulations will result
in increased costs to the Company, The Chase Manhattan Bank, N.A. (the "Bank"),
the Company's principal banking subsidiary, and their affiliates; however, based
upon its assessment of the overall impact of these rules and regulations, the
Corporation does not expect them to have a material effect on its operations. At
March 31, 1994, the capital ratios of the Bank exceeded the minimum capital
ratios required of a "well capitalized" institution as defined in the prompt
corrective action rule described in the "REGULATORY DEVELOPMENTS" section of the
accompanying Prospectus.
DESCRIPTION OF NOTES
The following description of the particular terms of the Notes offered
hereby supplements, and to the extent inconsistent therewith replaces, the
description of the general terms and provisions of the Subordinated Securities
(as defined in the accompanying Prospectus) set forth in the accompanying
Prospectus, to which description reference is hereby made.
GENERAL
The Notes offered hereby constitute a series of Subordinated Securities
under the Subordinated Indenture which series is limited to $150,000,000
aggregate principal amount. The Notes are not Subordinated Securities for which
Capital Securities are exchangeable and the Company will not designate funds
with regard to the Notes as Available Funds or Optional Available Funds. The
Notes are intended to qualify for U.S. bank regulatory purposes as a component
of "tier 2" capital under applicable capital adequacy guidelines for bank
holding companies. The Notes will mature on May 15, 2004.
The Notes will be issued in fully registered form only, in denominations of
$1,000 or any integral multiple thereof. The Notes will be represented initially
by one or more global Notes registered in the name of the Depository or its
nominee as described below.
The Notes will bear interest at the rate per annum shown on the cover of
this Prospectus Supplement from May 15, 1994, or from the most recent interest
payment date to which interest has been paid. Interest
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<PAGE> 7
will be payable semi-annually on May 15 and November 15 of each year, commencing
November 15, 1994, to the persons in whose names the Notes are registered at the
close of business on the preceding May 1 or November 1, as the case may be.
Interest payable at maturity will be payable to the person to whom principal
shall be payable.
REDEMPTION OF NOTES
The Notes may not be redeemed before May 15, 1999. On May 15, 1999 and on
any day thereafter, the Notes may be redeemed, as a whole or from time to time
in part, at the option of the Company, on not less than 30 nor more than 60
days' prior notice given as provided in the Subordinated Indenture, at a
redemption price equal to 100% of the principal amount of the Notes to be
redeemed plus interest accrued and unpaid to the date of redemption.
If less than all of the Notes are to be redeemed, the Notes to be redeemed
shall be selected by the Bank by such method as it shall deem fair and
appropriate and which may provide for the selection for redemption of portions
of the principal amount of the Notes of denominations larger than $1,000.
SUBORDINATION
The Notes will be unsecured and will be subordinate and junior in right of
payment to the Company's obligations to the holders of Senior Indebtedness of
the Company as described under "THE SUBORDINATED SECURITIES--Subordination" in
the accompanying Prospectus. At March 31, 1994, the outstanding Senior
Indebtedness of the Company (as defined in the Subordinated Indenture),
exclusive of guarantees and other contingent obligations of the Company, was
approximately $3.2 billion. There are no limitations in the Subordinated
Indenture on the issuance or incurrence of additional Senior Indebtedness of the
Company.
LIMITED RIGHT OF ACCELERATION
Payment of principal of the Notes may be accelerated only in case of the
bankruptcy, insolvency or reorganization of the Company. There is no right of
acceleration of the payment of principal of the Notes upon a default in the
payment of interest on the Notes or in the performance of any covenant of the
Company. See "THE SUBORDINATED SECURITIES--Events of Default and Waiver
Thereof " in the accompanying Prospectus.
BOOK-ENTRY NOTES
The Notes will be issued in the form of one or more fully-registered global
Notes (each, a "Book-Entry Note") which will be deposited with, or on behalf of,
the Depository and registered in the name of the Depository's nominee. Except as
set forth below, Book-Entry Notes may not be transferred except as a whole by
the Depository to a nominee of the Depository or by a nominee of the Depository
to the Depository or another nominee of the Depository or by the Depository or
any nominee to a successor of the Depository or a nominee of such successor.
The Depository has advised the Company and the Underwriter that it is a
limited-purpose trust company organized under the laws of the State of New York,
a member of the Federal Reserve System, a "clearing corporation" within the
meaning of the Uniform Commercial Code and a "clearing agency" registered
pursuant to the provisions of Section 17A of the Securities Exchange Act of
1934, as amended. The Depository was created to hold securities for persons that
have accounts with the Depository ("participants") and to facilitate the
clearance and settlement of securities transactions among its participants in
such securities through electronic book-entry changes in accounts of the
participants, thereby eliminating the need for physical movement of
certificates. The Depository's participants include securities brokers and
dealers (including the Underwriter), banks, trust companies, clearing
corporations and certain other organizations, some of which (and/or their
representatives) own the Depository. Access to the Depository's book-entry
system is also available to others, such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a
participant, either directly or indirectly. Persons who are not participants may
beneficially own interests in securities held by the Depository only through
participants.
Upon the issuance by the Company of a Book-Entry Note, the Depository will
credit, on its book-entry registration and transfer system, the respective
principal amounts of the Notes represented by such Book-
S-7
<PAGE> 8
Entry Note to the accounts of participants. Ownership of beneficial interests in
a Book-Entry Note will be limited to participants or persons that may hold
interests through participants. Ownership of beneficial interests in Book-Entry
Notes will be shown on, and the transfer of such interests will be effected only
through, records maintained by the Depository or its nominee (with respect to
beneficial interests of participants), or by participants or persons that may
hold interests through participants (with respect to beneficial interests of
beneficial ownership). The laws of some states may require that certain
purchasers of securities take physical delivery of such securities in
certificated form. Such limits and such laws may impair the ability to transfer
beneficial interests in Book-Entry Notes.
So long as the Depository, or its nominee, is the registered owner of the
Book-Entry Notes, the Depository or its nominee, as the case may be, will be
considered the sole owner or holder of the Notes represented by such Book-Entry
Notes for all purposes under the Subordinated Indenture. Except as provided
below, owners of beneficial interests in Book-Entry Notes will not be entitled
to have Notes represented by such Book-Entry Notes registered in their names,
will not receive or be entitled to receive physical delivery of such Notes in
certificated form and will not be considered the owners or holders thereof under
the Subordinated Indenture.
Principal and interest payments on the Notes represented by one or more
Book-Entry Notes will be made by the Company to the Depository or its nominee,
as the case may be, as the registered owner of the related Book-Entry Note or
Notes. The Company expects that the Depository or its nominee, upon receipt of
any payment of principal or interest in respect of Book-Entry Notes, will credit
immediately the account of the related participants with payment in amounts
proportionate to their respective holdings in principal amount of beneficial
interest in such Book-Entry Notes as shown on the records of the Depository.
Neither the Company nor the Subordinated Trustee or any Paying Agent will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of Book-Entry Notes,
or for maintaining, supervising or reviewing any records relating to such
beneficial interests. The Company also expects that payments by participants to
owners of beneficial interests in Book-Entry Notes held through such
participants will be governed by standing customer instructions and customary
practices, as is now the case with securities registered in "street name." Such
instructions will be the responsibility of such participants.
If the Depository is at any time unwilling, unable or ineligible to
continue as depository and a successor depository is not appointed by the
Company within 90 days, the Company will issue Notes in certificated form in
exchange for beneficial interests in the Book-Entry Notes. In addition, the
Company may at any time determine not to have its Notes represented by one or
more Book-Entry Notes, and, in such event, will issue Notes in certificated form
in exchange for Book-Entry Notes. In any such instance, an owner of a beneficial
interest in a Book-Entry Note will be entitled to physical delivery in
certificated form of Notes equal in principal amount to such beneficial interest
and to have such Notes registered in its name. Notes so issued in certificated
form will be issued in denominations of $1,000 or any amount in excess thereof
that is an integral multiple of $1,000 and will be issued in registered form
only, without coupons.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriter in immediately
available funds. All payments of principal and interest will be made by the
Company in immediately available funds.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearing-house or next-day funds. In contrast, the Notes
will trade in the Depository's Same-Day Funds Settlement System until maturity,
and secondary market trading activity in the Notes will therefore be required by
the Depository to settle in immediately available funds. No assurance can be
given as to the effect, if any, of settlement in immediately available funds on
trading activity in the Notes.
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<PAGE> 9
UNDERWRITING
Subject to the terms and conditions set forth in an underwriting agreement
(the "Underwriting Agreement") between the Company and Donaldson, Lufkin &
Jenrette Securities Corporation (the "Underwriter"), the Company has agreed to
sell to the Underwriter, and the Underwriter has agreed to purchase,
$150,000,000 principal amount of the Notes. The Underwriting Agreement provides
that, subject to the terms and conditions set forth therein, the Underwriter
will be obligated to purchase all of the Notes if any are purchased.
The Underwriter has advised the Company that it proposes initially to offer
the Notes to the public at the public offering price set forth on the cover page
of this Prospectus Supplement and in part to certain dealers at such price less
a concession not in excess of 0.375% of the principal amount thereof. The
Underwriter may allow, and such dealers may reallow, a discount not in excess of
0.25% of the principal amount of the Notes to certain other dealers. After the
initial public offering, the public offering price, concession and discount may
be changed.
Application will be made to list the Notes on the New York Stock Exchange.
The Company has been advised by the Underwriter that the Underwriter presently
intends to make a market in the Notes after the consummation of the offering,
although the Underwriter is under no obligation to do so and the Underwriter may
discontinue any such market making at any time at its sole discretion. No
assurance, however, can be given as to the liquidity of the trading market for
the Notes or that an active trading market for the Notes will develop. If an
active public market does not develop, the market prices and liquidity of the
Notes may be adversely affected.
The Company has agreed to indemnify the Underwriter against certain
liabilities, including liabilities under the Securities Act of 1933, or
contribute to payments which the Underwriter may be required to make in respect
thereof.
LEGAL OPINIONS
The validity of the Notes is being passed upon for the Company by Robert B.
Adams, Senior Vice President and Deputy General Counsel of the Company and the
Bank, and for the Underwriter by Brown & Wood, New York, New York. At March 31,
1994, Mr. Adams was the beneficial owner of or had options to purchase less than
0.02% of the outstanding shares of Common Stock of the Company.
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<PAGE> 10
PROSPECTUS
[LOGO]
$1,952,525,000
THE CHASE MANHATTAN CORPORATION
DEBT SECURITIES AND WARRANTS
------------------------
The Chase Manhattan Corporation (the "Company") may offer from time to time
pursuant hereto its unsecured debt securities which may be either Senior (the
"Senior Securities") or Subordinated (the "Subordinated Securities") in priority
of payment, consisting of debentures, notes or other evidences of indebtedness
(collectively, "Debt Securities"), or warrants to purchase Debt Securities (the
"Warrants"). The Debt Securities and Warrants are collectively referred to as
the "Securities". The Company may issue Securities at an aggregate initial
offering price which will result in proceeds to the Company of not more than
$1,952,525,000 or, if applicable, the equivalent thereof in any other currency
or currency units. The Securities may be offered as separate series in amounts,
at prices and on terms to be set forth in an accompanying Prospectus Supplement.
The terms of each series of Securities, including, where applicable, the
specific designation, priority, aggregate principal amount, authorized
denominations, maturity, interest rate or rates, interest payment dates, any
optional or mandatory redemption terms, any sinking fund provisions, any initial
public offering price, the proceeds to the Company, listing on any securities
exchange, and any other specific terms of or in connection with the offering and
sale of such series (the "Offered Securities") also will be set forth in any
accompanying Prospectus Supplement. As used herein, Securities shall include
securities denominated in United States dollars or, at the option of the
Company, if so specified in the applicable Prospectus Supplement, in any other
currency or composite of currencies or in amounts determined by reference to an
index.
The Senior Securities will rank equally with all other unsubordinated and
unsecured indebtedness of the Company. The Subordinated Securities will be
subordinated to all existing and future Senior Indebtedness of the Company, as
defined below. At December 31, 1992, the outstanding Senior Indebtedness of the
Company, exclusive of guarantees and other contingent obligations, was
approximately $4.1 billion. See "DESCRIPTION OF DEBT SECURITIES -- General".
When Warrants are offered, the Prospectus Supplement will set forth the
specific terms, such as, where applicable, the duration, offering price,
exercise price and detachability.
The Securities may be sold directly by the Company, through agents
designated from time to time or to or through underwriters or dealers. See "PLAN
OF DISTRIBUTION". If any agents of the Company or any underwriters are involved
in the sale of any Offered Securities in respect of which this Prospectus is
being delivered, the names of such agents or underwriters and any applicable
commissions or discounts will be set forth in a Prospectus Supplement. The net
proceeds to the Company from such sale also will be set forth in a Prospectus
Supplement.
------------------------
THE OFFERED SECURITIES ARE NOT SAVINGS ACCOUNTS, DEPOSITS OR OTHER
OBLIGATIONS OF ANY BANK OR NONBANK SUBSIDIARY OF THE COMPANY AND ARE NOT INSURED
BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, BANK INSURANCE FUND OR ANY OTHER
GOVERNMENT AGENCY.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS OR THE PROSPECTUS SUPPLEMENT TO WHICH IT RELATES.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF SECURITIES UNLESS
ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
------------------------
THE DATE OF THIS PROSPECTUS IS MARCH 2, 1993.
<PAGE> 11
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and, in accordance therewith, files
reports and other information with the Securities and Exchange Commission (the
"Commission"). Proxy statements, reports and other information concerning the
Company can be inspected and copied at the Commission's office at 450 Fifth
Street, N.W., Washington, D.C. 20549 and the Commission's Regional Offices in
New York (7 World Trade Center, New York, New York 10048) and Chicago
(Northwestern Atrium Center, 500 W. Madison Street, Suite 1400, Chicago,
Illinois 60661), and copies of such material can be obtained from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. Proxy statements, reports and other information
concerning the Company also may be inspected at the offices of the New York
Stock Exchange, Inc., 20 Broad Street, New York, New York 10005. This Prospectus
does not contain all the information set forth in the Registration Statement and
Exhibits thereto which the Company has filed with the Commission under the
Securities Act of 1933 (the "Act") and to which reference is hereby made.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
There are incorporated herein by reference the following documents of the
Company heretofore filed by it with the Commission:
(i) Annual Report on Form 10-K for the year ended December 31, 1992,
filed pursuant to Section 13 of the Exchange Act, including the portions of
THE CHASE MANHATTAN CORPORATION 1992 ANNUAL REPORT incorporated therein
(the "1992 Annual Report").
(ii) Current Reports on Form 8-K dated January 19, 1993, January 21,
1993 and January 26, 1993, filed pursuant to Section 13 of the Exchange
Act.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act subsequent to the date of this Prospectus and prior to the
termination of the offering of the Securities of the Company offered hereby
shall be deemed to be incorporated by reference into this Prospectus. Any
statement contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
ANY PERSON RECEIVING A COPY OF THIS PROSPECTUS MAY OBTAIN, WITHOUT CHARGE,
UPON WRITTEN OR ORAL REQUEST, A COPY OF ANY OF THE DOCUMENTS INCORPORATED BY
REFERENCE HEREIN, EXCEPT FOR THE EXHIBITS TO SUCH DOCUMENTS (OTHER THAN EXHIBITS
EXPRESSLY INCORPORATED BY REFERENCE THEREIN). WRITTEN REQUESTS SHOULD BE
DIRECTED TO:
THE CHASE MANHATTAN CORPORATION
1 CHASE MANHATTAN PLAZA
NEW YORK, NEW YORK 10081
ATTENTION: OFFICE OF THE SECRETARY
TELEPHONE REQUESTS MAY BE DIRECTED TO (212) 552-6511.
------------------------
Unless otherwise indicated, currency amounts in this Prospectus and any
Prospectus Supplement thereto are stated in United States dollars ("$",
"dollars" or "U.S.$").
2
<PAGE> 12
THE CHASE MANHATTAN CORPORATION
The Company is a bank holding company that was incorporated in 1969 and
whose principal subsidiary is The Chase Manhattan Bank (National Association)
(the "Bank"). As used herein, the term "Corporation" means the Company and its
consolidated subsidiaries and the term "Bank" means the Bank and its
subsidiaries.
In addition to the Bank, the Corporation holds investments in other
subsidiaries that provide a variety of financial services, including mortgage
banking, commercial and consumer financing, investment banking, securities
trading and investment advisory services. Over the last few years, the
Corporation has focused its business and marketing efforts on two types of
customers -- retail (individuals and small and medium-sized businesses) and
wholesale (primarily large corporations and institutions). The Corporation's
business groups serving retail customers are Consumer Products, Regional Banking
and Global Private Banking; those serving wholesale customers are Global
Corporate Finance, Global Risk Management and Transaction and Information
Services. In addition to these six core business groups, the Real Estate Finance
Sector manages the Corporation's loan portfolio related to the domestic
commercial real estate business and the LDC Portfolio Management group oversees
the Corporation's portfolio of cross-border extensions of credit to refinancing
countries.
The Company's ability to pay dividends on its preferred and common stock is
derived from several sources, including, among other sources, dividends from its
banking and nonbanking subsidiaries. The ability of the Company's banking
subsidiaries to pay dividends is subject to certain restrictions.
National banks are subject to various legal limitations which prohibit the
payment of dividends in certain circumstances and restrict the amount that may
be paid without the prior approval of the Office of the Comptroller of the
Currency ("OCC"). A national bank may not pay a dividend if that dividend would
exceed its net profits, as defined by national banking laws, then on hand.
Without the approval of the OCC, a national bank may not pay a dividend in any
given year in an amount greater than its net profits for that year combined with
its retained net profits from the preceding two years.
Under these limitations, at January 1, 1993, the Bank could declare
dividends in 1993 of approximately $370 million combined with an additional
amount equal to its retained net profits for 1993 up to the date of any dividend
declaration. Under applicable state and federal laws, The Chase Manhattan Bank
(USA) ("Chase USA") and Chase Bank of Maryland ("Chase Maryland") could declare
dividends in 1993 of approximately $740 million and $10 million, respectively,
combined with an additional amount equal to their respective retained net
profits for 1993 up to the date of any dividend declaration. In determining
whether, and to what extent, to pay dividends, each subsidiary bank also must
consider the effect of applicable risk-based capital guidelines and leverage
limitations.
The Company is a legal entity separate and distinct from the Bank and the
Company's other subsidiaries. There are various legal limitations on the extent
to which banks, such as the Bank, Chase USA and Chase Maryland, that are insured
by the Federal Deposit Insurance Corporation (the "FDIC"), can finance or
otherwise supply funds to certain of their affiliates. In particular, each such
bank that is a subsidiary of the Company is subject to certain restrictions on
any extensions of credit to, or other covered transactions, such as certain
purchases of assets, with, the Company or such affiliates. Such restrictions
prevent each such bank from lending to the Company and such affiliates unless
such extensions of credit are secured by U.S. Treasury obligations or other
specified collateral. Further, such secured extensions of credit by each such
bank are limited in amount as to the Company or any such affiliate to 10 percent
of such bank's capital and surplus and as to the Company and all such affiliates
in the aggregate to 20 percent of such bank's capital and surplus.
The Company's Executive Office is located at 1 Chase Manhattan Plaza, New
York, New York 10081 and its telephone number at said office is (212) 552-2222.
3
<PAGE> 13
REGULATORY DEVELOPMENTS
The Federal Deposit Insurance Corporation Improvement Act of 1991
("FDICIA") was enacted, among other things, to increase funding for the FDIC's
Bank Insurance Fund, and establish standards for, and restrictions on,
activities of depository institutions based upon capital status and supervisory
evaluation by federal banking regulators. Federal banking agencies were required
to adopt various rules and regulations implementing FDICIA, some of which were
promulgated in 1992 and others have been or are to be proposed. A regulation
governing acceptance of brokered deposits became effective in June 1992. In
September 1992, the FDIC adopted rules implementing a transitional risk-based
deposit insurance system as of January 1, 1993; a final system will be put into
effect no later than January 1, 1994. Under this system, formerly uniform
assessments will now be calculated at differential rates based on an
institution's capital ratios and the FDIC's assignment of the institution to a
supervisory subgroup based upon a qualitative evaluation by the institution's
primary regulator.
On December 19, 1992, a prompt corrective action rule became effective,
establishing a series of mandatory and discretionary actions for federal
regulators to take based upon the capital category of an institution (well
capitalized, adequately capitalized, undercapitalized, significantly
undercapitalized and critically undercapitalized). A "well capitalized"
institution is one having a ratio of Tier 1 capital to total risk adjusted
assets (the "Tier 1 risk adjusted ratio") of 6% or more, a ratio of total
capital to total risk adjusted assets (the "Total risk adjusted ratio") of 10%
or more and a ratio of Tier 1 capital to total assets (the "leverage ratio") of
5% or more and is not otherwise subject to a capital directive to meet a
specific level for any capital measure. An "adequately capitalized" institution
is one having a Tier 1 risk adjusted ratio of 4% or more, a Total risk adjusted
ratio of 8% or more, a leverage ratio of 4% or more (3% for certain highly rated
institutions) and does not otherwise meet the well capitalized definition. The
three undercapitalized categories are based upon the amount by which an
institution's ratios fall below the ratios applicable to adequately capitalized
institutions. At December 31, 1992, the capital ratios of the Bank exceeded the
minimum capital ratios required of a "well capitalized" institution as defined
in the prompt corrective action rule. Also on December 19, 1992, a rule placing
limits on interbank liabilities was adopted, requiring insured financial
institutions to establish by June 1993 prudential standards for limiting
exposure to correspondent banks and restricting, as of June 1994, credit
exposure to less than adequately capitalized banks. On December 23, 1992, real
estate lending regulations were issued, requiring depository institutions to
adopt, by March 1993, real estate lending policies which address such
considerations as loan-to-value limits, loan administration procedures,
diversification standards and documentation, approval and reporting
requirements. A regulation governing advertising and disclosures of interest
rates, yields and fee schedules relating to consumer deposit accounts was
adopted in 1992 and requires compliance by June 1993.
The Company expects that the above rules and regulations will result in
increased costs to the Company, the Bank and their affiliates; however, based
upon its assessment of the overall impact of these rules and regulations, the
Company does not expect them to have a material effect on its operations.
Further rules proposed or to be proposed under FDICIA, governing such
matters as operational and managerial standards, auditing and reporting
requirements and capital requirements, are expected to be finalized and become
effective in 1993. Until the various regulations are adopted in final form,
however, it is difficult to assess how they will impact the Company's financial
condition or operations.
USE OF PROCEEDS
Unless otherwise indicated in an accompanying Prospectus Supplement, the
net proceeds from the sale of the Securities will be applied to general
corporate purposes, including, without limitation, advances to or investments in
banking and non-banking subsidiaries of the Company and the repayment of
commercial paper or other indebtedness of the Company.
The Company expects that it will, from time to time, engage in additional
private or public financings in character and amount to be determined as market
conditions warrant and as the need arises.
4
<PAGE> 14
RATIOS OF EARNINGS TO FIXED CHARGES
The following are the consolidated ratios of earnings to fixed charges for
the Corporation for each of the years in the five-year period ended December 31,
1992:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
----------------------------------------
1992 1991 1990 1989 1988
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Excluding Interest on Deposits...................... 1.4 x 1.3 x * * 1.5 x
Including Interest on Deposits...................... 1.2 1.1 * * 1.2
- ---------------
<FN>
* For the years ended December 31, 1990 and 1989, earnings did not cover fixed
charges by $91 million and $449 million, respectively, primarily as a result
of large additions to the reserve for possible credit losses and special
charges.
</TABLE>
For purposes of computing the consolidated ratios, earnings represent net
income (loss) plus applicable income taxes and fixed charges, less equity in
undistributed earnings (losses) of unconsolidated subsidiaries and associated
companies. Fixed charges represent interest expense (exclusive of interest on
deposits in one case and inclusive of such interest in the other), amortization
of debt discount and issuance costs and one-third (the amount deemed to
represent an interest factor) of net rental expense under all lease commitments.
DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the Debt Securities sets forth
certain general terms and provisions of the Debt Securities to which any
Prospectus Supplement may relate. The Debt Securities may be issued from time to
time in one or more series. The particular terms of each series of Debt
Securities offered by any Prospectus Supplement and the extent, if any, to which
such general provisions may apply to the Debt Securities so offered will be
described in the Prospectus Supplement relating to such Debt Securities.
The Senior Securities will be issued under an Indenture dated as of July 1,
1986, as supplemented by a First Supplemental Indenture dated as of November 1,
1990 and a Second Supplemental Indenture dated as of May 1, 1991 between the
Company and Bankers Trust Company, as Trustee (the "Senior Trustee") (said
Indenture as so supplemented, the "Senior Indenture"). The Subordinated
Securities will be issued under an Indenture dated as of May 1, 1987, as
supplemented by a First Supplemental Indenture dated as of May 1, 1991 and a
Second Supplemental Indenture dated as of October 1, 1992 between the Company
and Chemical Bank, as Trustee (the "Subordinated Trustee") (said Indenture as so
supplemented, the "Subordinated Indenture"). The Senior Indenture and the
Subordinated Indenture are hereinafter collectively referred to as the
"Indentures".
The statements under this caption relating to the Debt Securities are brief
summaries of certain provisions of the Indentures, do not purport to be complete
and are qualified in their entirety by reference to the applicable Indenture,
each of which is filed as an exhibit to the Registration Statement. Such
summaries encompass all the material provisions of the Debt Securities and their
related Indentures. All article and section references appearing herein are to
articles and sections of the applicable Indenture, and all capitalized terms not
defined herein have the meanings specified in such Indenture. Whenever terms
which are defined in an Indenture are referred to, it is intended that such
defined terms shall be incorporated herein by reference.
Because the Company is a holding company, its rights and the rights of its
creditors, including the Holders of the Debt Securities, to participate in the
assets of any subsidiary upon the latter's liquidation or recapitalization would
be subject to the prior claims of such subsidiary's creditors except to the
extent that the Company may itself be a creditor with recognized claims against
such subsidiary. There is no restriction in the Debt Securities or either
Indenture against the incurring of indebtedness by the Company, the Bank or any
other subsidiary of the Company.
The Senior Securities may be issued either in registered form ("Registered
Securities") or bearer form ("Bearer Securities") with coupons attached or both.
The Bearer Securities are being offered only to non-United States persons and to
offices of certain United States financial institutions located outside the
United States. The Subordinated Securities may only be issued in registered
form.
5
<PAGE> 15
GENERAL
Neither Indenture limits the amount of Debt Securities which may be issued
thereunder and Debt Securities may be issued thereunder up to the aggregate
principal amount which may be authorized from time to time by the Company. The
Senior Securities will be unsecured and will rank on a parity with all other
unsecured and unsubordinated indebtedness of the Company. The Subordinated
Securities will be unsecured and will be subordinate and junior in right of
payment to the Company's obligations to the Holders of Senior Indebtedness of
the Company. See "THE SUBORDINATED SECURITIES -- Subordination". Unless
otherwise set forth in the applicable Prospectus Supplement, neither the
Indentures nor the Debt Securities contain provisions which would afford holders
of Debt Securities protection in the event of a takeover, recapitalization or
similar restructuring involving the Company, which could adversely affect the
Debt Securities.
Reference is made to the Prospectus Supplement that will contain the
specific terms of the series of Debt Securities that are Offered Securities,
including where applicable: (i) the title and priority of the Offered
Securities; (ii) any limit on the aggregate principal amount of the Offered
Securities; (iii) the price or prices (expressed as a percentage of the
aggregate principal amount thereof) at which the Offered Securities will be
issued; (iv) the date or dates on which the Offered Securities will mature; (v)
the rate or rates (which may be fixed or variable) per annum at which the
Offered Securities will bear interest, if any, or the method of determining the
same, and the date or dates from which such interest, if any, will accrue; (vi)
the Interest Payment Dates, if any, for the interest payable on the Offered
Securities and the Regular Record Dates for the interest payable on Registered
Securities and whether any such payments may be postponed or deferred; (vii)
whether interest in respect of any portion of a temporary global Debt Security
representing the Offered Securities which is payable in respect of an Interest
Payment Date prior to the issuance of definitive Debt Securities will be
credited to the Persons entitled thereto on such Interest Payment Date; (viii)
any mandatory or optional sinking fund, amortization or analogous provisions;
(ix) the place or places where the principal of (and premium, if any) and
interest, if any, on the Offered Securities will be payable if other than solely
at the Principal Trust Office (as defined under "Payment and Paying Agents"
below); (x) the date, if any, after which and the price or prices at which the
Offered Securities may, pursuant to any optional or mandatory redemption
provisions, be redeemed, in whole or in part, and the other detailed terms and
provisions of any such optional or mandatory redemption provisions; (xi) whether
the Offered Securities are to be issuable as Registered Securities or Bearer
Securities or both, any restrictions applicable to the offer, sale or delivery
of Bearer Securities, whether the Offered Securities may be issued in global
form, and, if so, the circumstances under which such Offered Securities may be
exchanged for Offered Securities of like tenor issued in a different form, and
the name of the depository with respect to any global Offered Security; (xii)
any special provisions for the payment of additional amounts with respect to the
Offered Securities; (xiii) the denominations in which any Offered Securities
which are Registered Securities will be issuable if other than denominations of
$1,000 and any integral multiple thereof, and the denominations in which any
Offered Securities which are Bearer Securities will be issuable if other than
the denomination of $5,000; (xiv) the currency or currencies of payment of
principal of (and premium, if any) and interest, if any, on the Offered
Securities if other than dollars; (xv) any index, currency exchange rate,
commodity or derivative instrument price, or other publicly available data used
to determine the amount of payments of principal of (and premium, if any) and
interest, if any, on the Offered Securities; (xvi) any special United States tax
considerations applicable to any Offered Securities; (xvii) any special
provisions relating to defeasance of the Senior Securities; (xviii) any
conversion or exchange provisions; and (xix) any other terms of the Offered
Securities not inconsistent with the provisions of the applicable Indenture.
Debt Securities may be issued as Original Issue Discount Securities (as
defined in the applicable Indenture) to be sold at a substantial discount below
their principal amount. Special United States federal income tax considerations
applicable to Debt Securities issued at an original issue discount, including
Original Issue Discount Securities and other special considerations applicable
to such series of Debt Securities will be set forth in the Prospectus Supplement
relating thereto.
6
<PAGE> 16
REGISTRATION AND TRANSFER
Unless otherwise provided with respect to any series of Debt Securities,
the Debt Securities of each series will be issuable as Registered Securities. If
so provided with respect to a series of Senior Securities, however, Senior
Securities of such series will be issuable solely as Bearer Securities, or in a
combination of both Registered Securities and Bearer Securities. Unless
otherwise specified with respect to such series of Senior Securities, Senior
Securities issued in bearer form shall have interest coupons attached. (Senior
Indenture Section 201) Bearer Securities may not be offered, sold, resold or
delivered in connection with their original issuance in the United States or to
United States persons (each as defined below) other than offices located outside
the United States of certain United States financial institutions. Purchasers of
Bearer Securities will be subject to certification procedures, and may be
affected by certain limitations under United States tax laws. (Senior Indenture
Section 311) See "THE SENIOR SECURITIES -- Limitations on Issuance of Bearer
Securities".
If Senior Securities of any series are issuable as both Registered
Securities and Bearer Securities, at the option of the Holder and subject to the
terms of the Senior Indenture, (i) Bearer Securities (with all unmatured
coupons, except as provided below, and all matured coupons in default) of such
series will be exchangeable into an equal aggregate principal amount of
Registered Securities of the same series of any authorized denominations and
like tenor and (ii) Registered Securities of such series will be exchangeable
into an equal aggregate principal amount of Registered Securities of the same
series of different authorized denominations and like tenor. Bearer Securities
surrendered in exchange for Registered Securities between a Regular Record Date
and the relevant Interest Payment Date shall not be surrendered with the coupon
relating to such Interest Payment Date. (Senior Indenture Section 305) Bearer
Securities will not be issued in exchange for Registered Securities.
Debt Securities may be presented for exchange as provided above, and
Registered Securities may be presented for transfer (with the form of transfer
endorsed thereon duly executed), at the office of the Security Registrar and at
the office of any transfer agent appointed by the Company for such purpose with
respect to Debt Securities of a series and referred to in the applicable
Prospectus Supplement without service charge and upon payment of any taxes and
other governmental charges as described in the Indentures. Such transfer or
exchange will be effected upon the Security Registrar or such transfer agent, as
the case may be, being satisfied with the documents of title and identity of the
person making the request. (Indentures Section 305) Unless otherwise specified
in the applicable Prospectus Supplement with respect to any Offered Securities,
the Bank, acting through its office in The City of New York where at any
particular time its corporate agency business is conducted, is designated as
Security Registrar. (Indentures Section 1002)
In the event of any redemption in part, the Company shall not be required
to (i) issue, register the transfer of or exchange Debt Securities of any series
for a period of 15 days immediately preceding the date notice is given
identifying the serial numbers of the Debt Securities of that series called for
redemption; (ii) register the transfer of or exchange any Registered Security
called for redemption in whole or in part, except the unredeemed portion of any
Registered Security being redeemed in part; (Indentures Section 305) or (iii)
exchange any Bearer Security called for redemption, except to exchange such
Bearer Security for a Registered Security of that series which is immediately
surrendered for redemption. (Senior Indenture Section 305)
CONVERSION RIGHTS
The terms, if any, on which Debt Securities may be convertible into or
exchangeable for other securities of the Company will be set forth in the
Prospectus Supplement relating thereto.
PAYMENT AND PAYING AGENTS
Payment of principal of (and premium, if any) and interest, if any, on
Bearer Securities will be payable in the currency designated in the Prospectus
Supplement, subject to any applicable laws and regulations, at the offices of
such Paying Agents outside the United States as the Company may designate.
Unless otherwise indicated in the Prospectus Supplement, payment of interest on
Bearer Securities on any Interest Payment
7
<PAGE> 17
Date will be made only against surrender of the coupon relating to such Interest
Payment Date. Unless otherwise indicated in the Prospectus Supplement, such
payment of principal of (and premium, if any) and interest, if any, on such
Bearer Security will be made by a check in the designated currency or, if
requested in writing by the Holder, by transfer to an account in the designated
currency maintained by the payee with a bank located outside the United States.
No payment with respect to any Bearer Security will be made at any office or
agency maintained by the Company in the United States nor will any such payment
be made by transfer to an account, or by mail to an address, in the United
States. Notwithstanding the foregoing, payments of principal of (and premium, if
any) and interest, if any, on Bearer Securities will be made in dollars at the
principal office of the Bank in The City of New York where at any particular
time its corporate trust business shall be administered (the "Principal Trust
Office") if payment of the full amount thereof in dollars at all offices or
agencies outside the United States is illegal or effectively precluded by
exchange controls or other similar restrictions. (Senior Indenture Sections 301,
1001, 1002)
Unless otherwise indicated in the Prospectus Supplement, payment of
principal (and premium, if any) on Registered Securities will be made in the
designated currency against surrender of such Registered Securities at the
Principal Trust Office or by check in the designated currency mailed to the
person in whose name such Debt Security is registered. Unless otherwise
indicated in the Prospectus Supplement, payment of any instalment of interest on
Registered Securities will be made to the person in whose name such Debt
Security is registered at the close of business on the Regular Record Date for
such interest. Unless otherwise indicated in the Prospectus Supplement, payments
of such interest will be made at the Principal Trust Office or, at the option of
the Company, by a check in the designated currency mailed to the Holder at such
Holder's registered address. (Indentures Sections 307, 1002)
The Bank acting through the Principal Trust Office has been designated as
the Company's Paying Agent in The City of New York. The Company may at any time
designate additional Paying Agents or rescind the designation of any Paying
Agent or approve a change in the office through which any Paying Agent acts,
except that the Company will maintain at least one Paying Agent in The City of
New York for payments with respect to Registered Securities of each series and,
if Debt Securities of a series are issuable as Bearer Securities, at least one
Paying Agent in a city outside the United States where Senior Securities of such
series may be presented and surrendered for payment, provided that, if the
Senior Securities of such series are listed on The Stock Exchange of the United
Kingdom and the Republic of Ireland Limited or the Luxembourg Stock Exchange or
any other stock exchange located outside the United States and such stock
exchange shall so require, the Company will maintain a Paying Agent in London or
Luxembourg or any other required city located outside the United States, as the
case may be, for the Senior Securities of such series, so long as the Senior
Securities of such series are listed on such exchange. (Indentures Section 1002)
Any money paid by the Company to a Paying Agent for the payment of
principal of (and premium, if any) or interest on any Debt Security which remain
unclaimed at the end of two years after such principal (and premium, if any) or
interest has become due and payable will be repaid to the Company and the Holder
of such Debt Security or any coupon may thereafter look only to the Company for
payment thereof. (Indentures Section 1003)
PERMANENT GLOBAL DEBT SECURITIES
If any Debt Securities of a series are issuable in permanent global form,
the applicable Prospectus Supplement will describe the circumstances, if any,
under which beneficial owners of interests in any such permanent global Debt
Security may exchange such interests for Debt Securities of such series and of
like tenor and principal amount in any authorized form and denomination. No
Bearer Debt Security delivered in exchange for any portion of a permanent global
Debt Security shall be mailed or otherwise delivered to any location in the
United States or its possessions in connection with such exchange. (Senior
Indenture Section 1107) Principal of (and premium, if any) and interest, if any,
on any permanent global Debt Security will be payable in the manner described in
the applicable Prospectus Supplement. (Indentures Sections 305, 1002)
8
<PAGE> 18
RESTRICTIONS ON DISPOSITION OF BANK STOCK
The Senior Indenture provides that, so long as any Senior Securities issued
thereunder are Outstanding, the Company will not create a security interest in
more than 20% of the shares of Capital Stock of the Bank, or permit more than
20% of such shares (exclusive of directors' qualifying shares) to be held
directly or indirectly other than (i) by the Company or (ii) by any corporation
which is wholly-owned (except for directors' qualifying shares) by the Company.
(Section 1006) The term "Capital Stock of the Bank" is defined in the Senior
Indenture as the capital stock, par value $15.00 per share, of the Bank as such
capital stock exists on the date of execution of such Indenture and such other
shares of stock of the Bank as shall have ordinary power to vote for election of
directors of the Bank and shall not have any preference as to distribution of
assets upon any dissolution or winding-up of the Bank. (Section 101) The Senior
Indenture does not contain any restriction on sales by the Bank of its assets.
Although the Subordinated Indenture (Section 1005) contains a restriction on the
disposition of the Capital Stock of the Bank similar to that contained in the
Senior Indenture, in order to comply with certain regulatory interpretations,
such restriction was made inapplicable to any Subordinated Securities issued
after October 1, 1992.
CONSOLIDATION, MERGER AND SALE OF ASSETS
Each Indenture provides that the Company may, without the consent of the
Holders of any of the Outstanding Debt Securities under such Indenture,
consolidate with, merge into or transfer its assets substantially as an entirety
to any corporation organized and existing under the laws of the United States,
any State or the District of Columbia, provided that the successor corporation
assumes the Company's obligations on the Debt Securities and under the
Indenture, and provided that after giving effect to the transaction no Event of
Default shall have happened and be continuing and that certain other conditions
are met. (Indentures Section 801)
EXCHANGE OR REDEMPTION
Debt Securities may be subject to redemption and exchange in certain
events, in the manner, at the places and subject to the restrictions set forth
in or established pursuant to the applicable Indenture and set forth in the Debt
Securities and the Prospectus Supplement relating thereto.
NOTICES
Except as otherwise provided in the relevant Indenture, notices to Holders
of Bearer Securities will be given by publication at least twice in a daily
newspaper in The City of New York and, if Debt Securities of such series are
then listed on The Stock Exchange of the United Kingdom and the Republic of
Ireland Limited or the Luxembourg Stock Exchange or any other stock exchange
located outside the United States and such stock exchange shall so require, in a
daily newspaper in London or Luxembourg or any other required city located
outside the United States, as the case may be, or, if not practicable, elsewhere
in Europe. Notices to Holders of Registered Securities will be given by mail to
the addresses of such Holders as they appear in the Security Register.
(Indentures Sections 101, 106)
TITLE
Title to any Bearer Security, any coupons appertaining thereto and any
temporary global Debt Security will pass by delivery. The Company, the Trustee
thereof and any agent of the Company or of the Trustee thereof may treat the
bearer of any Bearer Security and the bearer of any coupon and the registered
owner of any Registered Security as the absolute owner thereof (whether or not
any such Debt Security or coupon shall be overdue and notwithstanding any notice
to the contrary) for the purpose of making payment and for all other purposes.
(Indentures Section 308)
REPLACEMENT OF SECURITIES AND COUPONS
Any Debt Security (including any coupons appertaining to Bearer Securities)
that becomes mutilated, destroyed, lost or stolen will be replaced by the
Company at the expense of the Holder upon delivery to the Trustee of the Debt
Security and any coupons appertaining thereto or evidence of the destruction,
loss or theft thereof satisfactory to the Company and such Trustee. An indemnity
satisfactory to such Trustee and the
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Company may be required before a replacement Debt Security or coupon will be
issued. (Indentures Section 306)
GOVERNING LAW
Each Indenture, the Debt Securities and the coupons will be governed by and
construed in accordance with the laws of the State of New York. (Senior
Indenture Section 113, Subordinated Indenture Section 112)
THE SENIOR SECURITIES
EVENTS OF DEFAULT AND WAIVER THEREOF
The Senior Indenture provides that the happening of one or more of the
following events shall constitute an Event of Default with respect to the Senior
Securities of any series: (i) default in the payment of interest on any Senior
Security of such series for a period of 30 days; (ii) default in the payment of
the principal of (or premium, if any, on) any Senior Security of such series;
(iii) default in performance, or breach, of any covenant or warranty of the
Company contained in the Senior Indenture for the benefit of Senior Securities
of such series for a period of 60 days after notice has been given to the
Company; (iv) certain events of insolvency of the Company; and (v) any other
Event of Default specifically provided for by the terms of the Senior Securities
of such series. Any additional Events of Default with respect to any series of
Senior Securities will be specified in the Prospectus Supplement relating to
such series. (Section 501) In case an Event of Default shall have occurred and
be continuing with respect to the Senior Securities of any series, the Senior
Trustee or the Holders of not less than 25% in principal amount of the Senior
Securities of such series then outstanding may declare the principal of the
Senior Securities of such series (or, if the Senior Securities of such series
were issued as discounted Senior Securities, such portion of the principal as
may be specified in the terms of that series) to be due and payable immediately,
but such declaration may be annulled, and certain past defaults waived, by the
Holders of not less than a majority in principal amount of the Senior Securities
of such series, upon the conditions provided in the Senior Indenture. (Sections
502, 513)
The Senior Indenture provides that, subject to the duty of the Senior
Trustee during a default to act with the required standard of care, the Senior
Trustee will be under no obligation to exercise any of its rights or powers
under the Senior Indenture at the request or direction of any of the Holders,
unless such Holders shall have offered to the Senior Trustee reasonable
indemnity. (Sections 601, 603) Subject to such provisions for the
indemnification of the Senior Trustee and certain other conditions, the Holders
of a majority in principal amount of the Outstanding Senior Securities of any
series will have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Senior Trustee, or exercising any
trust or power conferred on the Senior Trustee, with respect to the Senior
Securities of that series. (Section 512)
The Company is required to furnish to the Senior Trustee annually a
statement as to the performance by the Company of certain of its obligations
under the Senior Indenture and as to any default in such performance. (Section
1007)
LIMITATIONS ON ISSUANCE OF BEARER SECURITIES
In compliance with United States federal tax and securities laws and
regulations, Bearer Securities may not be offered, sold, resold or delivered, as
part of their issuance at any time or otherwise until 40 days after the closing
date for those Senior Securities in the United States or to United States
persons (each as defined below) other than to offices of United States financial
institutions located outside the United States which agree in writing to comply
with the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal
Revenue Code of 1986, as amended (the "Code"), and the regulations thereunder,
and any underwriters, agents and dealers participating in the offering of Senior
Securities will agree that they will not offer any Bearer Securities for sale or
resale during the restricted period in the United States or to United States
persons (other than the financial institutions described above) nor deliver
Bearer Securities within the United States. Bearer Securities will bear a legend
substantially to the following effect: "Any United States person who holds this
obligation will be subject to limitations under the United States income tax
laws, including the limitations provided in Sections 165(j) and 1287(a) of the
Internal Revenue Code."
As used herein, "United States person" means any citizen or resident of the
United States, any corporation or partnership or other entity created or
organized in or under the laws of the United States or any
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state thereof or any estate or trust the income of which is subject to United
States federal income taxation regardless of its source, and "United States"
means the United States of America (including the States and the District of
Columbia), its territories, its possessions and other areas subject to its
jurisdiction. (Section 311)
TEMPORARY GLOBAL SENIOR SECURITIES
Pending the availability of definitive Senior Securities, Senior Securities
which are issuable as Bearer Securities initially may be represented by one or
more temporary global Senior Securities, without interest coupons, to be
deposited with a common depositary in London for the Euroclear System
("Euroclear") and Cedel S.A. for credit to the designated accounts against
certifications to the effect described below. Unless otherwise indicated in a
Prospectus Supplement, any such temporary global Senior Security will be
exchangeable only for definitive Bearer Securities. Such exchange may occur
following the availability of definitive forms of Bearer Securities, subject to
any further limitations described in the applicable Prospectus Supplement, and
only upon certification that such Bearer Securities are not being acquired by or
on behalf of a United States person (other than by or through certain foreign
branches of United States financial institutions) or by a person who has
purchased the Bearer Securities for resale within the United States or to United
States persons. No such Bearer Security delivered in exchange for a portion of a
temporary global Senior Security shall be mailed or otherwise delivered to any
location in the United States in connection with such exchange. (Sections 304,
311)
If so specified in the applicable Prospectus Supplement, interest in
respect of any portion of a temporary global Senior Security payable in respect
of an Interest Payment Date prior to the issuance of definitive Bearer
Securities will be paid to each of Euroclear and Cedel S.A. with respect to the
portion of such temporary global Senior Security held for its account. Each of
Euroclear and Cedel S.A. will undertake in such circumstances to credit such
interest received by it in respect of a temporary global Senior Security to the
respective accounts for which it holds such temporary global Senior Security
only upon receipt in each case of certification that, as of the relevant
Interest Payment Date, the portion of such temporary global Senior Security on
which such interest is to be so credited is either not beneficially owned by a
United States person (other than by or through certain foreign branches of
United States financial institutions) or by a person who has purchased the
Bearer Securities for resale to United States persons. (Sections 304, 311)
MODIFICATION AND WAIVER; MEETINGS
Modifications and amendments of the Senior Indenture may be made by the
Company and the Senior Trustee with the consent of the Holders of not less than
66 2/3% in principal amount of the Outstanding Senior Securities of each series
affected by such modification or amendment; provided, however, that no such
modification or amendment may, without the consent of the Holder of each
Outstanding Senior Security affected thereby, (i) change the Stated Maturity of
the principal of, or any instalment of principal of or interest on, any Senior
Security; (ii) reduce the principal amount of any Senior Security or change the
rate of interest or the method of calculation of interest thereon (except as
provided in the Senior Indenture or in such Senior Security), or any premium
payable upon the redemption thereof; (iii) change any obligation of the Company
to pay additional amounts pursuant to the Senior Indenture; (iv) reduce the
amount of principal of an Original Issue Discount Senior Security payable upon
acceleration of the maturity thereof; (v) adversely affect the right of
repayment, if any, at the option of the Holder thereof; (vi) change the coin or
currency in which any Senior Security or any premium or any interest thereon is
payable; (vii) impair the right to institute suit for the enforcement of any
payment on or with respect to any Senior Security; (viii) reduce the percentage
in principal amount of Outstanding Senior Securities of any series, the consent
of whose Holders is required for modification or amendment of the Senior
Indenture or for waiver of compliance with certain provisions of the Senior
Indenture or for waiver of certain defaults; (ix) change any obligation of the
Company to maintain an office or agency in the Borough of Manhattan, The City of
New York, or any obligation of the Company to maintain an office or agency
outside the United States pursuant to the Senior Indenture; or (x) modify
certain provisions of the Senior Indenture requiring consent of specified
percentages of Holders except to increase any such percentage. (Section 902)
The Holders of at least 66 2/3% in principal amount of the Outstanding
Senior Securities of each series may, on behalf of all Holders of Senior
Securities of that series, waive, insofar as that series is concerned,
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compliance by the Company with certain restrictive provisions of the Senior
Indenture. (Section 1008) The Holders of not less than a majority in principal
amount of the Outstanding Senior Securities of each series may, on behalf of the
Holders of all the Senior Securities of that series and any coupons appertaining
thereto, waive any past default under the Senior Indenture with respect to
Senior Securities of that series, except a default (i) in the payment of
principal of (or premium, if any) or interest, if any, on any Senior Security of
such series, or (ii) in respect of a covenant or provision of the Senior
Indenture which cannot be modified or amended without the consent of the Holder
of each Outstanding Senior Security of such series affected thereby. (Section
513)
The Senior Indenture contains provisions for convening meetings of the
Holders of Senior Securities of a series if Senior Securities of that series are
issuable as Bearer Securities. (Section 1301) A meeting may be called at any
time by the Trustee, and also, upon request, by the Company or the Holders of at
least 10% in principal amount of the Outstanding Senior Securities of such
series, in any such case upon notice given in accordance with "DESCRIPTION OF
DEBT SECURITIES -- Notices" above. (Section 1302) Except as limited by the
proviso in the second preceding paragraph, any resolution presented at a meeting
or adjourned meeting at which a quorum is present may be adopted by the
affirmative vote of the Holders of a majority in principal amount of the
Outstanding Senior Securities of that series; provided, however, that, except as
limited by the proviso in the second preceding paragraph, any resolution with
respect to any consent or waiver which may be given by the Holders of not less
than 66 2/3% in principal amount of the Outstanding Senior Securities of a
series may be adopted at a meeting or an adjourned meeting at which a quorum is
present only by the affirmative vote of the Holders of 66 2/3% in principal
amount of the Outstanding Senior Securities of that series; and provided,
further, that, except as limited by the proviso in the second preceding
paragraph, any resolution with respect to any request, demand, authorization,
direction, notice, consent, waiver or other action which may be made, given or
taken by the Holders of a specified percentage, which is less than a majority,
in principal amount of the Outstanding Senior Securities of a series may be
adopted at a meeting or adjourned meeting duly reconvened at which a quorum is
present by the affirmative vote of the Holders of such specified percentage in
principal amount of the Outstanding Senior Securities of that series. Any
resolution passed or decision taken at any meeting of Holders of Senior
Securities of any series duly held in accordance with the Senior Indenture will
be binding on all Holders of Senior Securities of that series and the related
coupons. The quorum at any meeting called to adopt a resolution, and at any
reconvened meeting, will be persons holding or representing a majority in
principal amount of the Outstanding Senior Securities of a series; provided,
however, that if any action is to be taken at such meeting with respect to a
consent or waiver which may be given by the Holders of not less than 66 2/3% in
principal amount of the Outstanding Senior Securities of a series, the persons
entitled to vote 66 2/3% in principal amount of the Outstanding Senior
Securities of such series will constitute a quorum. (Section 1304)
DEFEASANCE
The Company may elect to defease and be discharged from its obligations
under the Senior Indenture with respect to Senior Securities of any series on
the terms and subject to the conditions contained in the Senior Indenture, by
(a) depositing irrevocably with the Senior Trustee as trust funds (i) in the
case of Senior Securities denominated in a foreign currency, money in such
foreign currency or Foreign Government Obligations (as defined below) of the
foreign government or governments issuing such foreign currency, in each case in
an amount which through the payment of interest, principal or premium, if any,
in respect thereof in accordance with their terms will provide (without any
reinvestment of such interest, principal or premium), not later than one
Business Day before the due date of any payment, money in such foreign currency
or (ii) in the case of Senior Securities denominated in U.S. dollars, U.S.
dollars or U.S. Government Obligations (as defined below), in each case in an
amount which through the payment of interest, principal or premium, if any, in
respect thereof in accordance with their terms will provide (without any
reinvestment of such interest, principal or premium), not later than one
Business Day before the due date of any payment, U.S. dollars or (iii) a
combination of U.S. dollars and U.S. Government Obligations or Foreign
Government Obligations, as applicable, sufficient to pay the principal of or
premium, if any, and interest, if any, on the Senior Securities of such series
as are due and (b) satisfying certain other conditions precedent specified in
the Senior Indenture. Such deposit and defeasance is conditioned among other
things upon the Company's delivery to the Senior
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Trustee of an opinion of counsel that the Holders of the Senior Securities of
such series will have no federal income tax consequences as a result of such
deposit and termination. (Article Fifteen)
"U.S. Government Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either case, under
clauses (i) or (ii) are not callable or redeemable at the option of the issuer
thereof. "Foreign Government Obligations" means securities denominated in a
foreign currency that are (i) direct obligations of a foreign government for the
payment of which its full faith and credit is pledged or (ii) obligations of a
Person controlled or supervised by and acting as an agency or instrumentality of
a foreign government the payment of which is unconditionally guaranteed as a
full faith and credit obligation by such foreign government, which, in either
case, under clauses (i) or (ii) have, at the time of defeasance, a rating from a
nationally recognized rating agency in their country of issue or the United
States at least equivalent to the highest rating given to the Senior Securities
being defeased by Moody's Investors Service, Inc. or Standard & Poor's
Corporation at any time since the issuance of such Senior Securities, and are
not callable or redeemable at the option of the issuer thereof. (Section 101)
REGARDING THE SENIOR TRUSTEE
Bankers Trust Company, the Senior Trustee under the Senior Indenture, has
its principal corporate trust office at Four Albany Street, New York, New York
10015. Bankers Trust Company also serves as trustee under the indentures with
the Company relating to the Floating Rate Notes Due 1999, the Floating Rate
Notes Due 2009, convertible at the option of the holder into 8 1/2% Sinking Fund
Debentures Due 2009, the 8 1/2% Notes Due 1996, the 7 7/8% Notes Due 1997, the
7 3/8% Notes Due 1994, the fixed and floating rate Medium-Term Notes and Senior
Medium-Term Notes, Series A and Series B of the Company. The Corporation has
normal banking relationships with the Senior Trustee.
THE SUBORDINATED SECURITIES
EVENTS OF DEFAULT AND WAIVER THEREOF
The Subordinated Indenture defines an Event of Default with respect to
Subordinated Securities of any series as certain events involving the
bankruptcy, insolvency or reorganization of the Company and such other events as
may be established for any series of Subordinated Securities. (Section 501) In
order to comply with certain regulatory interpretations, this provision has been
modified to exclude from the definition of an Event of Default with respect to
any Subordinated Securities issued after October 1, 1992, the inability of the
Company to pay its debts as they become due and the appointment of a conservator
with respect to a depository institution subsidiary of the Company insured by
the FDIC or any successor agency. If an Event of Default with respect to
Subordinated Securities of any series at the time outstanding occurs and is
continuing, either the Subordinated Trustee or the Holders of not less than 25%
in aggregate principal amount of the Outstanding Subordinated Securities of that
series, by notice as provided in the Subordinated Indenture, may declare the
principal amount (or, if the Subordinated Securities of that series are Original
Issue Discount Subordinated Securities, such portion of the principal amount as
may be specified in the terms of that series) of all the Subordinated Securities
of that series to be due and payable immediately in cash. The foregoing
provision would be subject as to enforcement to the broad equity powers of a
federal bankruptcy court and to the determination by that court of the nature of
the rights of the Holders of the Subordinated Securities of such series. At any
time after a declaration of acceleration with respect to Subordinated Securities
of any series has been made, but before a judgment or decree for payment of the
money due has been obtained by the Subordinated Trustee, the Holders of a
majority aggregate principal amount of the Outstanding Subordinated Securities
of that series may, under certain circumstances, rescind and annul such
declaration. (Sections 502, 513)
The Subordinated Indenture does not provide for any right of acceleration
of the payment of principal of the Subordinated Securities of any series upon a
default in the payment (including any obligation to exchange Capital Securities
(as defined below) for Subordinated Securities of such series) of principal of
(or premium,
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if any) or interest, if any, on the Subordinated Securities of such series, or
in the performance of any covenant or agreement in the Subordinated Indenture or
in the terms of the Subordinated Securities of such series. In the event of any
such default (including a default in such payment or exchange at the stated
maturity date of the Subordinated Securities of such series), the Company will,
upon demand of the Subordinated Trustee, pay to it, for the benefit of the
Holders of the Subordinated Securities of such series, the whole amount then due
and payable on the Subordinated Securities of such series for principal (and
premium, if any) and interest, if any, including the delivery of any Capital
Securities then required to be delivered. The Subordinated Indenture provides
that if the Company fails to pay such amount (or to deliver any such Capital
Securities) forthwith upon such demand, the Subordinated Trustee may, among
other things, institute a judicial proceeding for the collection thereof or for
delivery of any Capital Securities required to be delivered. The Subordinated
Indenture also provides that if Capital Securities are exchangeable for
Subordinated Securities of such series and the Company shall fail to elect the
type of Capital Securities to be exchanged for Subordinated Securities of such
series on the relevant exchange date or shall fail to issue or deliver such
Capital Securities on or prior to such exchange date, the Company shall be
liable to the Holders of Subordinated Securities of such series for the payment
of the principal amount of Subordinated Securities of such series (or the
applicable percentage thereof) in cash on the earlier of the relevant proposed
exchange date or the stated maturity date of Subordinated Securities of such
series. The limitation on the right of acceleration described above permits
limited amounts of Subordinated Securities with certain original weighted
average maturities to qualify as supplementary or "Tier 2" capital of the
Company under current regulatory guidelines for bank holding companies. Any
additional Events of Default with respect to any series of Subordinated
Securities, including any related right of acceleration, will be specified in
the Prospectus Supplement relating to such series. (Section 503)
The Subordinated Indenture provides that, subject to the duty of the
Subordinated Trustee during the continuance of an Event of Default or Default to
act with the required standard of care, the Subordinated Trustee will be under
no obligation to exercise any of its rights or powers under the Subordinated
Indenture at the request or direction of any of the Holders of the Subordinated
Securities of any series, unless such Holders shall have offered to the
Subordinated Trustee reasonable indemnity. Subject to such provisions for the
indemnification of the Subordinated Trustee, the Holders of a majority in
aggregate principal amount of the Outstanding Subordinated Securities of any
series will have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Subordinated Trustee, or
exercising any trust or power conferred on the Subordinated Trustee, with
respect to the Subordinated Securities of such series.(Sections 512, 601, 603)
The Subordinated Indenture provides that notwithstanding any other
provision of the Subordinated Indenture, each Holder of Subordinated Securities
of any series shall have the right to institute suit for the enforcement of any
payment (including any delivery of Capital Securities to be exchanged for such
Subordinated Securities) of principal of (and premium, if any) and interest, if
any, on such Subordinated Securities on the respective stated maturity dates
expressed in such Subordinated Securities or on the Exchange Date or the
redemption date thereof, as the case may be, and that such right shall not be
impaired without the consent of such Holder. (Section 508)
The Holders of not less than a majority in principal amount of the
Outstanding Subordinated Securities of any series may, on behalf of the holders
of all Subordinated Securities of such series, waive any past default under the
Subordinated Indenture with respect to Subordinated Securities of such series
and its consequences, except a default (i) in the payment (including any
obligation to exchange Capital Securities for Subordinated Securities of such
series) of principal of (or premium, if any) or interest, if any, on any
Subordinated Security of such series, or (ii) in respect of a covenant or
provision of the Subordinated Indenture which cannot be modified or amended
without the consent of the Holder of each Outstanding Subordinated Security of
such series affected thereby. (Section 513)
The Company is required to file annually with the Subordinated Trustee a
written statement as to the existence or non-existence of defaults. (Section
1006)
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MODIFICATION AND WAIVER
The Subordinated Indenture provides that, with the consent of the Holders
of not less than 66 2/3% in principal amount of the Outstanding Subordinated
Securities of each series affected thereby, modifications and alterations of the
Subordinated Indenture may be made which affect the rights of the Holders of the
Subordinated Securities of such series, but no such modification or alteration
may be made without the consent of the Holder of each Subordinated Security
affected thereby which would (i) change the fixed maturity of the principal of,
or any instalment of principal of or interest on, any Subordinated Security, or
reduce the principal amount thereof or change the rate or rates (or the method
of ascertaining the rate or rates) of interest thereon (except as provided in
the Subordinated Indenture or in the Subordinated Securities of such series) or
any premium payable upon the redemption thereof, or reduce the portion of the
principal amount of any Original Issue Discount Subordinated Security payable
upon acceleration of the maturity thereof, or change any place where, or the
coin or currency in which, the principal amount of any Subordinated Security or
any premium or interest thereon is payable, or impair any right to institute
suit for the enforcement of any right to receive payment of the principal of
(and premium, if any) and interest, if any, on such Subordinated Security on the
respective stated maturity dates expressed in such Subordinated Security (or, in
the case of redemption, on the redemption date), or, if applicable, to have
delivered Capital Securities to be exchanged for such Subordinated Security and
to have such Capital Securities sold in a secondary offering to the extent
provided in such Subordinated Security and in the Subordinated Indenture, or
modify the provisions of the Subordinated Indenture with respect to the
subordination of the Subordinated Securities of such series in a manner adverse
to the Holders, or (ii) reduce the above-stated percentage in principal amount
of Outstanding Subordinated Securities of such series required to modify or
alter the Subordinated Indenture, or (iii) impair the right of any Holder of
Subordinated Securities of such series, subject to the provisions of the
Subordinated Indenture and of Subordinated Securities of such series, to receive
on any exchange date for Subordinated Securities of such series Capital
Securities with a market value equal to the amount established with respect to
the Securities of such series held by such Holder. (Sections 902, 1007)
EXCHANGEABILITY
If so provided in the applicable Prospectus Supplement, Subordinated
Securities may be exchangeable, either upon the occurrence of certain events
described in the applicable Prospectus Supplement or at the option of the
Company or both, for Capital Securities, and certain funds may be designated
with regard to the Subordinated Securities as Available Funds (as defined in the
applicable Prospectus Supplement) or Optional Available Funds (as defined in the
applicable Prospectus Supplement) for United States bank regulatory purposes. In
certain circumstances, Subordinated Securities may also provide Holders with the
right to elect to receive cash for Capital Securities issued in exchange for
Offered Subordinated Securities. The applicable Prospectus Supplement will set
forth the terms, conditions and restrictions relating to any of the foregoing
provisions applicable to a series of Subordinated Securities. (Sections 1301,
1310, 1401)
"Capital Securities" means any securities issued by the Company which
consist of any one of the following: (i) Common Stock (as defined in the
Subordinated Indenture), (ii) Perpetual Preferred Stock (as defined in the
Subordinated Indenture), or (iii) other securities which at the date of issuance
are securities of a type that may constitute capital of the Company in unlimited
amounts for which Subordinated Securities are permitted to be exchanged under
regulations of, or other determinations by, the Company's Primary Federal
Regulator (as defined in the applicable Prospectus Supplement), provided that if
any securities under (iii) are (a) issued in exchange for Subordinated
Securities under the Subordinated Indenture and (b) debt obligations for which
Capital Securities are exchangeable, the Company shall have received the
approval of the Company's Primary Federal Regulator for such issuance. Capital
Securities may have such terms, rights and preferences as may be determined by
the Company. (Section 101)
The staff of the Securities and Exchange Commission has advised that Rule
13e-4 and Rule 14e-1 of the Commission's rules and regulations relating to
tender offers, as currently interpreted and in effect, would be applicable to
the exchange of Capital Securities for Subordinated Securities and to the
related secondary offering. If the staff were to continue to take this position,
the Company intends, subject to its right to seek
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appropriate relief (which may or may not be available) from the application of
such rules, at the time of the exchange of Capital Securities for Subordinated
Securities and the related secondary offering to comply with Rule 13e-4 and Rule
14e-1 (or any successor rules), as then interpreted and in effect, and to afford
holders of Subordinated Securities all rights under, and to make all filings
required by, such rules (or successor rules).
SUBORDINATION
The obligation of the Company to make any payment on account of the
principal of (and premium, if any) and interest, if any, on the Subordinated
Securities will be subordinate and junior in right of payment to the Company's
obligations to the holders of Senior Indebtedness of the Company to the extent
described in the next paragraph. "Senior Indebtedness of the Company" is defined
in the Subordinated Indenture to mean the obligations of the Company to its
creditors other than the Holders of the Subordinated Securities, whether
outstanding on the date of execution of the Subordinated Indenture or thereafter
incurred, except obligations "ranking on a parity with the [Subordinated]
Securities" or "ranking junior to the [Subordinated] Securities" (as those terms
are defined in the Subordinated Indenture). The obligations of the Company in
respect of the Subordinated Securities will rank on a parity with the Company's
obligations in respect of the 7 3/8% Subordinated European Currency Unit Bonds
Due 1993, the Floating Rate Subordinated Notes Due 1995, the Floating Rate
Subordinated Notes Due 1997, the 7 1/2% Subordinated Notes Due 1997, the 10%
Subordinated Notes Due 1999, the 8% Subordinated Notes Due 1999, the 7 3/4%
Subordinated Notes due 1999, the Floating Rate Subordinated Notes Due 2000, the
9 3/8% Subordinated Notes Due 2001, the Floating Rate Subordinated Notes Due
2009, the 9 3/4% Subordinated Notes Due 2001, the 7.50% Subordinated Notes Due
2003 and the Subordinated Medium-Term Notes, Series A and Series B issued by the
Company and any other obligations of the Company ranking on a parity with the
Subordinated Securities. The obligations of the Company in respect of the
Subordinated Securities of any series will rank on a parity with the obligations
of the Company in respect of the Subordinated Securities of each other series.
(Section 1201)
In the case of any insolvency, receivership, conservatorship,
reorganization, readjustment of debt, marshalling of assets and liabilities or
similar proceedings or any liquidation or winding-up of or relating to the
Company as a whole, whether voluntary or involuntary, all obligations of the
Company to Holders of Senior Indebtedness of the Company shall be entitled to be
paid in full before any payment shall be made on account of the principal of
(and premium, if any) and interest, if any, on the Subordinated Securities. At
December 31, 1992, the outstanding Senior Indebtedness of the Company, exclusive
of guarantees and other contingent obligations, was approximately $4.1 billion.
In the event of any such proceeding, after payment in full of all sums owing
with respect to Senior Indebtedness of the Company, the Holders of the
Subordinated Securities, together with the holders of any obligations of the
Company ranking on a parity with the Subordinated Securities, shall be entitled
to be paid from the remaining assets of the Company the amounts at the time due
and owing on account of unpaid principal of (and premium, if any) and interest,
if any, on the Subordinated Securities before any payment or other distribution,
whether in cash, property or otherwise, shall be made on account of any capital
stock or any obligations of the Company ranking junior to the Subordinated
Securities. By reason of such subordination, in the event of the insolvency of
the Company, Holders of Senior Indebtedness of the Company may receive more,
ratably, and Holders of the Subordinated Securities having a claim pursuant to
the Subordinated Securities may receive less, ratably, than the other creditors
of the Company. Such subordination will not prevent the occurrence of any Event
of Default in respect of the Subordinated Securities. See "-- Events of Default
and Waiver Thereof" for limitations on the right of acceleration of Subordinated
Securities that qualify as capital under current regulatory guidelines. (Section
1201)
REGARDING THE SUBORDINATED TRUSTEE
Chemical Bank, the Subordinated Trustee under the Subordinated Indenture,
has its principal corporate trust office at 450 West 33rd Street, New York, New
York 10001. Chemical Bank serves as Trustee with respect to the 7 1/2%
Subordinated Notes Due 1997, the 10% Subordinated Notes Due 1999, the 8%
Subordinated Notes Due 1999, the 7 3/4% Subordinated Notes due 1999, the 9 3/8%
Subordinated Notes Due 2001, the 9 3/4% Subordinated Notes Due 2001, the 7.50%
Subordinated Notes Due 2003 and the Subordinated Medium-Term Notes, Series A and
Series B of the Company, which are currently outstanding under the
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<PAGE> 26
Subordinated Indenture. Chemical Bank also serves as trustee under the indenture
with the Company relating to the Floating Rate Subordinated Notes Due 1995. The
Corporation has normal banking relationships with the Subordinated Trustee.
DESCRIPTION OF CAPITAL SECURITIES
The following Capital Securities, if so indicated in a Prospectus
Supplement relating to the Offered Securities, may be issuable in exchange for a
series of Subordinated Securities, or upon conversion thereof. The Capital
Securities which may be exchanged for Subordinated Securities, inter alia may
consist of Common Stock and Preferred Stock.
COMMON STOCK
The Company is authorized to issue 500,000,000 shares of Common Stock, par
value $2.00 per share ("Common Stock"). At December 31, 1992, 156,096,382 shares
of Common Stock were outstanding, 3,960,615 shares of Common Stock were reserved
for issuance pursuant to the Company's Floating Rate Subordinated Notes Due 1996
(which were subsequently redeemed on January 13, 1993), 12,286,851 shares of
Common Stock were reserved for issuance pursuant to the Chase Lincoln First Bank
N.A. 1982 Incentive Stock Plan, The Chase Manhattan 1982 Long-Term Incentive
Plan and The Chase Manhattan 1987 Long-Term Incentive Plan and 11,585,991 shares
of Common Stock were reserved for issuance pursuant to the Company's Dividend
Reinvestment and Stock Purchase Plan.
Holders of shares of Common Stock are entitled to one vote per share and,
subject to the rights, if any, of holders of shares of the outstanding series of
preferred stock of the Company (as described below under "Preferred Stock"),
have equal rights to participate in dividends when declared and, in the event of
liquidation, in the net assets of the Company available for distribution to
stockholders. The Company may not declare any dividends on, or make any payment
on account of the purchase, redemption or other retirement of, its Common Stock
unless full cumulative dividends, where applicable, have been paid or declared
and set apart for payment upon all outstanding shares of the preferred stock of
the Company and the Company is not in default or in arrears with respect to any
sinking or other analogous fund or any call for tender obligations or any other
agreement for the purchase, redemption or other retirement of any shares of the
preferred stock of the Company. The holders of shares of Common Stock do not
have redemption or sinking fund rights, and none of the holders of shares of
Common Stock is entitled to preemptive rights or preferential rights to
subscribe for shares of Common Stock or any other securities of the Company,
except for certain Junior Participating Preferred Stock Purchase Rights that
attached to the Common Stock on February 27, 1989 and which are attached to any
shares of Common Stock issued after that date, which are exercisable or
transferable separately from shares of Common Stock only upon the occurrence of
certain events including the acquisition by a person or group of affiliated or
associated persons of 20% or more of the outstanding shares of Common Stock of
the Company. Such rights are more fully described in the 1992 Annual Report of
the Company and will be more fully described in any Prospectus Supplement
applicable to Debt Securities that are convertible or exchangeable into Common
Stock. Shares of Common Stock are fully paid and nonassessable; however, federal
law (12 U.S.C. sec. 55) provides for the enforcement of any pro rata assessment
of stockholders of a national bank to cover impairment of capital by sale, to
the extent necessary, of the stock of any assessed stockholder failing to pay
his assessment, and the Company, as the stockholder of the Bank and other
national banking subsidiaries, is subject to such assessment and sale. The
shares of Common Stock are listed on the New York Stock Exchange. The transfer
agent and registrar for the Common Stock of the Company is Mellon Securities
Trust Company.
The Restated Certificate of Incorporation of the Company ("Certificate of
Incorporation") includes a "fair price provision" that would require a 75%
stockholder vote for approval of certain business combinations, including
certain mergers, asset sales, security issuances, recapitalizations and
liquidations, involving the Company or its subsidiaries and certain acquiring
persons (namely, a person, entity or specified group which beneficially owns
more than 10% of the voting stock of the Company), unless the "fair price" and
other procedural requirements of the provision are met, or unless approved by a
majority of directors who are not
17
<PAGE> 27
affiliated with the acquiring party. This provision includes a requirement of a
75% stockholder vote to amend or repeal it. The Certificate of Incorporation
also provides for classification of the Company's Board of Directors into three
classes and includes related provisions requiring (i) advance notice of
stockholder nominations of directors, (ii) limitations on filling newly created
directorships and vacancies, (iii) removal of directors only for cause and by
vote of at least 75% of the shares entitled to vote, (iv) a limitation on action
by written consent of holders of Common Stock other than at a meeting of
stockholders and (v) a requirement of a 75% stockholder vote to amend or repeal
such provisions.
PREFERRED STOCK
Under the Certificate of Incorporation, the Board of Directors of the
Company is authorized to issue up to 100,000,000 shares of Preferred Stock,
without par value, in one or more series, with such voting powers, full or
limited but not to exceed one vote per share, or without voting powers, and with
such designations, preferences and relative, participating, optional or other
voting rights, and qualifications, limitations or restrictions thereof, as shall
be stated and expressed in the resolution or resolutions of the Board of
Directors providing for the issue thereof.
At December 31, 1992, the following series of Preferred Stock were
outstanding: Preferred Stock, 6 3/4% Series B, with a stated value of $100 per
share; Preferred Stock, 7.60% Series C, with a stated value of $100 per share;
Preferred Stock, Floating Rate Series E, with a stated value of $50 per share;
Preferred Stock, Floating Rate Series F, with a stated value of $50 per share;
Preferred Stock, 10 1/2% Series G, with a stated value of $25 per share;
Preferred Stock, 9.76% Series H, with a stated value of $25 per share; Preferred
Stock, 10.84% Series I, with a stated value of $25 per share; Preferred Stock,
9.08% Series J, with stated value of $25 per share; Preferred Stock, 8- 1/2%
Series K, with a stated value of $25 per share; and Preferred Stock, 8.32%
Series L, with a stated value of $25 per share. On January 28, 1993, the Company
issued 6,900,000 shares of Preferred Stock, 8.40% Series M, with a stated value
of $25 per share.
Holders of shares of Preferred Stock generally have only contingent voting
rights with respect to the election of directors. In the event of liquidation,
before any distribution to the holders of Common Stock, the holders of the
shares of each outstanding series of Preferred Stock generally are entitled to
receive an amount equal to the stated value of such shares, plus accrued and
unpaid dividends. At December 31, 1992, such preferential amounts were
approximately $1.5 billion in the aggregate, exclusive of any dividend accruals.
OTHER CAPITAL SECURITIES
The Company may also select any other securities to be exchanged for
Subordinated Securities or to be sold and the proceeds of such sale to be
Available Funds or Optional Available Funds which qualify at the date of
issuance as Capital Securities as determined by the Company's Primary Federal
Regulator, provided that if any such other securities are issued in exchange for
Subordinated Securities and are debt obligations for which Capital Securities
may be exchanged, the Company will have received the approval of its Primary
Federal Regulator for such issuance. Such other Capital Securities will have
such terms as may be determined by the Company and approved by its Board of
Directors.
DESCRIPTION OF WARRANTS
The Company may issue, together with any Debt Securities of a series
offered or separately, Warrants for the purchase of other Debt Securities of
such series. The Warrants are to be issued under Warrant Agreements (each a
"Warrant Agreement") to be entered into between the Company and a bank or trust
company, as Warrant Agent (the "Warrant Agent"), all as set forth in the
applicable Prospectus Supplement relating to the particular issue of Warrants. A
copy of the form of Warrant Agreement, including the form of Warrant
Certificates representing the Warrants (the "Warrant Certificates"), reflecting
the alternative provisions to be included in the Warrant Agreements that will be
entered into with respect to particular offerings of Warrants, is filed as an
exhibit to the Registration Statement of which this Prospectus forms a part. The
following summaries of certain provisions of the Warrant Agreement and the
Warrant Certificates do not purport to be complete and are subject to, and are
qualified in their entirety by reference to, all
18
<PAGE> 28
provisions of the Warrant Agreement and the Warrant Certificates, respectively,
including the definition therein of certain terms. Such summaries encompass all
the material provisions contained in the form of Warrant Agreement and the form
of Warrant Certificate.
The applicable Prospectus Supplement will describe the following terms of
the Warrants being offered thereby, the Warrant Agreement relating to such
Warrants and the Warrant Certificates representing such Warrants: (i) the number
of Warrants offered; (ii) the designation, aggregate principal amount and terms
of the Debt Securities purchasable upon exercise of such Warrants; (iii) the
designation and terms of any related Debt Securities with which such Warrants
are issued and the number of such Warrants issued with each such Debt Security;
(iv) the date, if any, on and after which such Warrants and the related Debt
Securities will be separately transferable; (v) the principal amount of Debt
Securities purchasable upon exercise of one Warrant and the price at which such
principal amount of Debt Securities may be purchased upon such exercise; (vi)
the date on which the right to exercise the Warrants shall commence and the date
on which such right shall expire (the "Expiration Date"); (vii) the form in
which the Warrants represented by the Warrant Certificates will be issued and
where the Warrants represented by Warrant Certificates may be transferred and
registered; and (viii) any other terms of the Warrants. The applicable
Prospectus Supplement will contain a summary of the United States federal income
tax, accounting and other consequences with respect to the Warrants.
If issued in definitive form, Warrant Certificates will be exchangeable for
new Warrant Certificates of authorized denominations at the corporate trust
office of the Warrant Agent or any other office indicated in the applicable
Prospectus Supplement. Prior to the exercise of Warrants, holders of such
Warrants will not have any of the rights of Holders of the Debt Securities
purchasable upon such exercise and will not be entitled to payments of principal
of (or premium, if any) or interest, if any, on the Debt Securities purchasable
upon such exercise.
EXERCISE OF WARRANTS
Each Warrant will entitle the holder to purchase such principal amount of
Debt Securities at such exercise price as shall in each case be set forth in, or
calculable from, the Prospectus Supplement relating to such Warrant. Warrants
may be exercised at any time up to the close of business on the Expiration Date
set forth in the Prospectus Supplement relating to such Warrants. After the
close of business on the Expiration Date (or such later date to which such
Expiration Date may be extended by the Company), unexercised Warrants will
become void.
Warrants may be exercised by delivery to the Warrant Agent of payment as
provided in the applicable Prospectus Supplement of the amount required to
purchase the Debt Securities purchasable upon such exercise together with
certain information set forth on the reverse side of the Warrant Certificate.
Warrants will be deemed to have been exercised upon receipt of the exercise
price, subject to the receipt, within five business days, of the Warrant
Certificate evidencing such Warrants. Upon receipt of such payment and the
Warrant Certificate properly completed and duly exercised at the corporate trust
office of the Warrant Agent or any other office indicated in the applicable
Prospectus Supplement, the Company will, as soon as practicable, issue and
deliver pursuant to the applicable Indenture the Debt Securities purchasable
upon such exercise. If fewer than all of the Warrants represented by such
Warrant Certificate are exercised, a new Warrant Certificate will be issued for
the remaining amount of outstanding Warrants.
PLAN OF DISTRIBUTION
The Company may sell Securities to one or more underwriters for public
offering and sale by them or may sell Securities to investors directly or
through agents which solicit or receive offers on behalf of the Company or
through dealers or through a combination of any such methods of sale. Any such
underwriter or agent involved in the offer and sale of the Offered Securities
will be named in an accompanying Prospectus Supplement.
Underwriters may offer and sell the Offered Securities at a fixed price or
prices, which may be changed, or from time to time at market prices prevailing
at the time of sale, at prices related to such prevailing market
19
<PAGE> 29
prices or at negotiated prices. The Company also may offer and sell the Offered
Securities in exchange for one or more of its outstanding issues of debt or
convertible debt securities. The Company also may, from time to time, authorize
agents acting on a best efforts basis as agents of the Company to solicit or
receive offers to purchase the Offered Securities upon the terms and conditions
as are set forth in the accompanying Prospectus Supplement. In connection with
the sale of Offered Securities, underwriters or agents may be deemed to have
received compensation from the Company in the form of underwriting discounts or
commissions and may also receive commissions from purchasers of Offered
Securities for whom they may act as agents. Underwriters may sell Offered
Securities to or through dealers, and such dealers may receive compensation in
the form of discounts, concessions or commissions from the underwriters and/or
commissions from the purchasers for whom they may act as agent.
Any compensation paid by the Company to underwriters or agents in
connection with the offering of Offered Securities, and any discounts,
concessions or commissions allowed by underwriters to participating dealers, are
set forth in an accompanying Prospectus Supplement. Underwriters, dealers and
agents participating in a distribution of the Offered Securities (including
agents only soliciting or receiving offers to purchase Offered Securities on
behalf of the Company) may be deemed to be underwriters, and any discounts and
commissions received by them and any profit realized by them on resale of the
Offered Securities may be deemed to be underwriting discounts and commissions,
under the Act. Underwriters, dealers and agents may be entitled, under
agreements entered into with the Company, to indemnification against and
contribution toward certain civil liabilities, including liabilities under the
Act. The Company may agree to reimburse underwriters or agents for certain
expenses incurred in connection with the distribution of the Offered Securities.
If so indicated in an accompanying Prospectus Supplement, the Company will
authorize agents or dealers acting as the Company's agents to solicit offers by
certain institutions to purchase Offered Securities from the Company at the
public offering price set forth in such Prospectus Supplement pursuant to
delayed delivery contracts ("Contracts") providing for payment and delivery on
the date or dates stated in such Prospectus Supplement. Each Contract will be
for an amount not less than, and the aggregate principal amount of Offered
Securities sold pursuant to Contracts shall be not less nor more than, the
respective amounts stated in such Prospectus Supplement. Institutions with whom
Contracts, when authorized, may be made include commercial and savings banks,
insurance companies, pension funds, investment companies, educational and
charitable institutions, and other institutions but will in all cases be subject
to the approval of the Company. Contracts will not be subject to any conditions
except (i) the purchase by an institution of the Offered Securities covered by
its Contracts shall not at the time of delivery be prohibited under the laws of
any jurisdiction in the United States to which such institution is subject, and
(ii) if the Offered Securities are being sold to underwriters, the Company shall
have sold to such underwriters the total principal amount of the Offered
Securities less the principal amount thereof covered by Contracts.
Each underwriter, dealer and agent participating in the distribution of any
Offered Securities which are issuable as Bearer Securities will agree that it
will not offer, sell or deliver, directly or indirectly, Bearer Securities in
the United States or to United States persons (other than qualifying financial
institutions), in connection with the original issuance of the Offered
Securities. See "THE SENIOR SECURITIES -- Limitations on Issuance of Bearer
Securities".
Offers of the Securities may not be made in Great Britain except to persons
whose ordinary business it is to buy or sell shares or debentures, whether as
principal or agent, and this Prospectus and any Prospectus Supplement or any
other offering material relating to the Securities may not be distributed in or
from Great Britain except to persons whose business involves the acquisition and
disposal, or the holding, of securities, whether as principal or as agent.
Certain of the underwriters, dealers or agents and their associates may be
customers of, engage in transactions with, and perform services for, the Company
in the ordinary course of business.
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<PAGE> 30
Each offering of the Offered Securities will be conducted in compliance
with any applicable requirements of Schedule E to the By-Laws of the National
Association of Securities Dealers, Inc. This Prospectus may be used by an
affiliate of the Company in connection with offers and sales related to market
making activities. Any such affiliate may act as principal or agent in any such
transactions. Such sales will be made at prices related to the prevailing market
prices at the time of sale.
EXPERTS
The Company only and consolidated financial statements of the Corporation
as of December 31, 1992 and 1991 and for each of the years in the three-year
period ended December 31, 1992 incorporated in this Prospectus by reference to
the Company's Annual Report on Form 10-K for the year ended December 31, 1992,
have been so incorporated in reliance on the report of Price Waterhouse,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
LEGAL OPINION
The legality of the Securities offered hereby will be passed upon for the
Company by Robert B. Adams, Senior Vice President and Assistant General Counsel
of the Company and the Bank. As of December 31, 1992, Mr. Adams was the
beneficial owner of or had options to purchase less than 0.02% of the
outstanding shares of Common Stock of the Company.
21
<PAGE> 31
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NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS IN CONNECTION WITH THE OFFER MADE BY
THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS. IF GIVEN OR MADE, SUCH OTHER
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED
BY THE COMPANY OR THE UNDERWRITER. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS
SHALL NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY, THE
NOTES OFFERED HEREBY IN ANY JURISDICTION WHERE, OR TO ANY PERSON TO WHOM, IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN
THE FACTS SET FORTH IN THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS OR IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
------------------------
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
Recent Developments.................... S-2
Interim Results........................ S-2
Ratios of Earnings to Fixed Charges.... S-6
Certain Regulatory Matters............. S-6
Description of Notes................... S-6
Underwriting........................... S-9
Legal Opinions......................... S-9
PROSPECTUS
Available Information.................. 2
Incorporation of Certain Documents
by Reference......................... 2
The Chase Manhattan Corporation........ 3
Regulatory Developments................ 4
Use of Proceeds........................ 4
Ratios of Earnings to Fixed Charges.... 5
Description of Debt Securities......... 5
The Senior Securities.................. 10
The Subordinated Securities............ 13
Description of Capital Securities...... 17
Description of Warrants................ 18
Plan of Distribution................... 19
Experts................................ 21
Legal Opinion.......................... 21
</TABLE>
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$150,000,000
[LOGO]
THE CHASE MANHATTAN
CORPORATION
8% SUBORDINATED NOTES
DUE 2004
------------------------------
PROSPECTUS SUPPLEMENT
------------------------------
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
May 18, 1994
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