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RESTATED CERTIFICATE OF INCORPORATION
OF
J.P. MORGAN CHASE & CO.
Under Section 245
of the
General Corporation Law of the State of Delaware
J.P. Morgan Chase & Co. (the "Corporation"), does hereby
certify under the seal of the Corporation as follows:
First: The name of the Corporation is J.P. Morgan Chase & Co.;
the Corporation was originally incorporated as Chemical New York Corporation.
Second: The Certificate of Incorporation of the Corporation
was filed with the Secretary of State of the State of Delaware in Dover,
Delaware, on the 28th day of October, 1968.
Third: This Restated Certificate of Incorporation was duly
adopted in accordance with Section 245 of the General Corporation Law of
Delaware and only restates and integrates and does not further amend the
provisions of the Corporation's Restated Certificate of Incorporation as
heretofore restated, amended and supplemented. There is no discrepancy between
those provisions and the provisions of this Restated Certificate of
Incorporation.
Fourth: The text of the Restated Certificate of Incorporation
of the Corporation, as amended, is hereby restated to read in full, as follows:
FIRST. The name of the Corporation is J.P. Morgan Chase & Co.
SECOND. The address of its registered office in the State of
Delaware is Corporation Trust Center, 1209 Orange Street, Wilmington, New Castle
County, Delaware 19801. The name of its registered agent at such address is The
Corporation Trust Company.
THIRD. The purpose of the Corporation is to engage in any
lawful act or activity for which corporations may be organized under the General
Corporation Law of Delaware. Without limiting in any manner the scope and
generality of the foregoing, the Corporation shall have the following purposes
and powers:
(1) To acquire by purchase, subscription, or otherwise, and to
receive, hold, own, guarantee, sell, assign, exchange, transfer,
mortgage, pledge, or otherwise dispose of or deal in and with any and
all securities, as such term is hereinafter defined, issued or created
by any corporation, firm, organization, association or other entity,
public or private, whether formed under the laws of the United States
of America or of any state, commonwealth, territory, dependency or
possession thereof, or of any foreign country or of any political
subdivision, territory, dependency, possession or municipality thereof,
or issued or created by the United States of America or any state or
commonwealth thereof or any foreign country, or by any agency,
subdivision, territory, dependency, possession or municipality of any
of the foregoing, and as owner thereof to possess and exercise all
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the rights, powers and privileges of ownership, including the right to
execute consents and vote thereon;
(2) to make, establish and maintain investments in securities,
and to supervise and manage such investments;
(3) to cause to be organized under the laws of the United
States of America or of any state, commonwealth, territory, dependency
or possession thereof, or of any foreign country or of any political
subdivision, territory, dependency, possession or municipality thereof,
one or more corporations, firms, organizations, associations or other
entities and to cause the same to be dissolved, wound up, liquidated,
merged or consolidated;
(4) to acquire by purchase or exchange, or by transfer to or
by merger or consolidation with the Corporation or any corporation,
firm, organization, association or other entity owned or controlled,
directly or indirectly, by the Corporation, or to otherwise acquire,
the whole or any part of the business, good will, rights or other
assets of any corporation, firm, organization, association or other
entity, and to undertake or assume in connection therewith the whole or
any part of the liabilities and obligations thereof, to effect any such
acquisition in whole or in part by delivery of cash or other property,
including securities issued by the Corporation, or by any other lawful
means;
(5) to make loans and give other forms of credit, with or
without security, and to negotiate and make contracts and agreements in
connection therewith;
(6) to aid by loan, subsidy, guaranty or in any other lawful
manner any corporation, firm, organization, association or other entity
of which any securities are in any manner directly or indirectly held
by the Corporation or in which the Corporation or any such corporation,
firm, organization, association or entity may be or become otherwise
interested; to guarantee the payment of dividends on any stock issued
by any such corporation, firm, organization, association or entity; to
guarantee or, with or without recourse against any such corporation,
firm, organization, association or entity, to assume the payment of the
principal of, or the interest on, any obligations issued or incurred by
such corporation, firm, organization, association or entity; to do any
and all other acts and things for the enhancement, protection or
preservation of any securities which are in any manner, directly or
indirectly, held, guaranteed or assumed by the Corporation, and to do
any and all acts and things designed to accomplish any such purpose;
(7) to borrow money for any business, object or purpose of the
Corporation from time to time, without limit as to amount; to issue any
kind of evidence of indebtedness, whether or not in connection with
borrowing money, including evidences of indebtedness convertible into
stock of the Corporation, to secure the payment of any evidence of
indebtedness by the creation of any interest in any of the property or
rights of the Corporation, whether at that time owned or thereafter
acquired;
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(8) to render service, assistance, counsel and advice to, and
to act as representative or agent in any capacity (whether managing,
operating, financial, purchasing, selling, advertising or otherwise)
of, any corporation, firm, organization, association or other entity;
and
(9) to engage in any commercial, financial, mercantile,
industrial, manufacturing, marine, exploration, mining, agricultural,
research, licensing, servicing, or agency business not prohibited by
law, and any, some or all of the foregoing.
The term "securities" as used in this Certificate of
Incorporation shall mean any and all notes, stocks, treasury stocks, bonds,
debentures, evidences of indebtedness, certificates of interest or participation
in any profit-sharing agreement, collateral-trust certificates, preorganization
certificates or subscriptions, transferable shares, investment contracts, voting
trust certificates, certificates of deposit for a security, fractional undivided
interests in oil, gas, or other mineral rights, or, in general, any interests or
instruments commonly known as "securities", or any and all certificates of
interest or participation in, temporary or interim certificates for, receipts
for, guaranties of, or warrants or rights to subscribe to or purchase, any of
the foregoing.
The purposes and powers specified in the foregoing paragraphs
shall, except where otherwise expressed, be in nowise limited or restricted by
reference to, or inference from, the terms of any other paragraph in this
Certificate of Incorporation, but the purposes and powers specified in each of
the foregoing paragraphs of this Article THIRD shall be regarded as independent
purposes and powers.
The Corporation shall possess and may exercise all powers and
privileges necessary or convenient to effect any or all of the foregoing
purposes, or to further any or all of the foregoing powers, and the enumeration
herein of any specific purposes or powers shall not be held to limit or restrict
in any manner the exercise by the Corporation of the general powers and
privileges now or hereafter conferred by the laws of the State of Delaware upon
corporations formed under the General Corporation Law of Delaware.
FOURTH. The total number of shares of all classes of capital
stock which the Corporation shall have authority to issue is FOUR BILLION SEVEN
HUNDRED MILLION, of which TWO HUNDRED MILLION shares shall be shares of
preferred stock of the par value of $1 per share (hereinafter called "Preferred
Stock") and FOUR BILLION FIVE HUNDRED MILLION shares shall be shares of common
stock of the par value of $1 per share (hereinafter called "Common Stock").
Any amendment to this Certificate of Incorporation which shall
increase or decrease the authorized capital stock of the Corporation may be
adopted by the affirmative vote of the holders of capital stock representing not
less than a majority of the voting power represented by the outstanding shares
of capital stock of the Corporation entitled to vote.
The designations and the powers, preferences and rights, and
the qualifications, limitations or restrictions thereof, of the Preferred Stock
shall be as follows:
(1) The Board of Directors is expressly authorized at any
time, and from time to time, to provide for the issuance of shares of
Preferred Stock in one or more series,
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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 special rights, and
qualifications, limitations or restrictions thereof, as shall be stated
and expressed in the resolution or resolutions providing for the issue
thereof adopted by the Board of Directors, and as are not stated and
expressed in this Certificate of Incorporation, or any amendment
thereto, including (but without limiting the generality of the
foregoing) the following:
(a) the designation of such series;
(b) the dividend rate of such series, the conditions
and dates upon which such dividends shall be payable, the
preference or relation which such dividends shall bear to the
dividends payable on any other class or classes or on any
other series of any class or classes of capital stock, and
whether such dividends shall be cumulative or non-cumulative;
(c) whether the shares of such series shall be
subject to redemption by the Corporation, and, if made subject
to such redemption, the times, prices and other terms and
conditions of such redemption;
(d) the terms and amount of any sinking fund provided
for the purchase or redemption of the shares of such series;
(e) whether or not the shares of such series shall be
convertible into or exchangeable for shares of any other class
or classes or of any other series of any class or classes of
capital stock of the Corporation, and, if provision be made
for conversion or exchange, the times, prices, rates,
adjustments and other terms and conditions of such conversion
or exchange;
(f) the extent, if any, to which the holders of the
shares of such series shall be entitled to vote as a class or
otherwise with respect to the election of the directors or
otherwise; provided, however, that in no event shall any
holder of any series of Preferred Stock be entitled to more
than one vote for each share of such Preferred Stock held by
him;
(g) the restrictions, if any, on the issue or reissue
of any additional Preferred Stock;
(h) the rights of the holders of the shares of such
series upon the dissolution of, or upon the distribution of
assets of, the Corporation.
(2) Except as otherwise required by law and except for such
voting powers with respect to the election of directors or other
matters as may be stated in the resolutions of the Board of Directors
creating any series of Preferred Stock, the holders of any such series
shall have no voting power whatsoever.
(3) The voting powers, designations, preferences and relative,
participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof,
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of the Corporation's Adjustable Rate Cumulative Preferred Stock, Series
A, are set forth in Appendix A hereto and are incorporated by
reference.
(4) The voting powers, designations, preferences and relative,
participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, of the
Corporation's Variable Cumulative Preferred Stock, Series B through F,
are set forth in Appendix B hereto and are incorporated by reference.
(5) The voting powers, designations, preferences and relative,
participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, of the
Corporation's 6 5/8% Cumulative Preferred Stock, are set forth in
Appendix C hereto and are incorporated by reference.
(6) The voting powers, designations, preferences and relative,
participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, of the
Corporation's Adjustable Rate Cumulative Preferred Stock, Series L are
set forth in Appendix D hereto and are incorporated herein by
reference.
(7) The voting powers, designations, preferences and relative,
participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, of the
Corporation's 10.84% Cumulative Preferred Stock are set forth in
Appendix E hereto and are incorporated herein by reference.
(8) The voting powers, designations, preferences and relative,
participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, of the
Corporation's Adjustable Rate Cumulative Preferred Stock, Series N are
set forth in Appendix F hereto and are incorporated herein by
reference.
(9) The voting powers, designations, preferences and relative,
participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, of the
Corporation's Fixed/Adjustable Noncumulative Preferred Stock, Series B
through F, are set forth in Appendix G hereto and are incorporated by
reference.
FIFTH. The by-laws may be made, altered, amended or repealed
by the Board of Directors. The books of the Corporation (subject to the
provisions of the laws of the State of Delaware) may be kept outside of the
State of Delaware at such places as from time to time may be designated by the
Board of Directors.
SIXTH. (1) To the fullest extent that the General Corporation
Law of the State of Delaware as it exists on the date hereof or as it may
hereafter be amended permits the limitation or elimination of the liability of
directors, no director of the Corporation shall be personally liable to the
Corporation or its stockholders for monetary damages for breach of fiduciary
duty as a director.
(2) The Corporation shall have the power to indemnify any
director, officer, employee or agent of the Corporation or any other
person who is serving at the request of the Corporation in any such
capacity with another corporation, partnership, joint venture, trust or
other enterprise (including, without limitation, any employee benefit
plan) to the
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fullest extent permitted by the General Corporation Law of the State of
Delaware as it exists on the date hereof or as it may hereafter be
amended, and any such indemnification may continue as to any person who
has ceased to be a director, officer, employee or agent and may inure
to the benefit of the heirs, executors and administrators of such a
person.
(3) By action of its Board of Directors, notwithstanding any
interest of the directors in the action, the Corporation may purchase
and maintain insurance, in such amounts as the Board of Directors deems
appropriate, to protect any director, officer, employee or agent of the
Corporation or any other person who is serving at the request of the
Corporation in any such capacity with another corporation, partnership,
joint venture, trust or other enterprise (including, without
limitation, any employee benefit plan) against any liability asserted
against him or incurred by him in any such capacity or arising out of
his status as such (including, without limitation, expenses, judgments,
fines and amounts paid in settlement) to the fullest extent permitted
by the General Corporation Law of the State of Delaware as it exists on
the date hereof or as it may hereafter be amended, and whether or not
the Corporation would have the power or would be required to indemnify
any such person under the terms of any agreement or by-law or the
General Corporation Law of the State of Delaware. For purposes of this
paragraph (3), "fines" shall include any excise taxes assessed on a
person with respect to any employee benefit plan.
SEVENTH. (1) Any action required or permitted to be taken by
the holders of Common Stock of the Corporation must be effected at a duly called
annual or special meeting of the stockholders of the Corporation and may not be
effected by any consent in writing.
(2) Whenever the vote of holders of shares of any class or
series other than Common Stock at a meeting thereof is required or
permitted to be taken for or in connection with any corporate action by
any provision of the General Corporation Law of the State of Delaware,
the meeting and vote of such stockholders may be dispensed with if such
action is taken with the written consent of such holders representing
not less than a majority of the voting power of all the capital stock
of such class or series entitled to be voted upon such action if a
meeting were held; provided that in no case shall the written consent
be by such holders having less than the minimum percentage of the vote
required by statute for such action, and provided that prompt notice is
given in writing to all such stockholders entitled to vote thereon of
the taking of corporate action without a meeting and by less than
unanimous written consent.
(3) Election of directors need not be by ballot unless the
by-laws so provide.
EIGHTH. The Corporation reserves the right to amend, alter,
change or repeal any provision contained in this Certificate of Incorporation,
in the manner now or hereafter prescribed by statute, and all rights conferred
upon stockholders herein are granted subject to this reservation.
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IN WITNESS WHEREOF, the Corporation has caused this
certificate to be signed by its authorized officer and caused the corporate seal
of the Corporation to be hereunto affixed this 1st day of January, 2001.
_____________________________
Anthony J. Horan
Secretary
[Corporate Seal]
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Appendix A
CERTIFICATE OF DESIGNATIONS
OF
ADJUSTABLE RATE CUMULATIVE PREFERRED STOCK, SERIES A
OF
J.P. MORGAN CHASE & CO.
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
J.P. MORGAN CHASE & CO., a corporation organized under the
laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES that the
following resolutions were duly adopted by the Board of Directors of the
Corporation at a meeting duly held and convened on September 12, 2000, and by
the Stock Committee of the Board of Directors by unanimous written consent
executed on December 18, 2000, pursuant to the authority conferred upon the
Board of Directors by the provisions of the Restated Certificate of
Incorporation of the Corporation, which authorized the issuance of up to
200,000,000 shares of preferred stock, par value $1.00 per share, and pursuant
to authority conferred upon the Stock Committee of the Board of Directors by
Section 141(c) of the General Corporation Law of the State of Delaware, by the
By-Laws of the Corporation and by resolutions of the Board of Directors adopted
at a meeting duly convened and held on September 12, 2000:
1. The Board of Directors on September 12, 2000 adopted the
following resolutions authorizing the Stock Committee of the Board of Directors
to act on behalf of the Board of Directors in connection with the issuance of
Preferred Stock pursuant to the terms and conditions of the Agreement and Plan
of Merger, dated as of September 12, 2000, between J.P. Morgan & Co.
Incorporated ("J.P. Morgan") and the Corporation, which provided for the merger
of J.P. Morgan with and into the Corporation, with the Corporation continuing as
the surviving corporation in the merger under the name "J.P. Morgan Chase &
Co.":
RESOLVED, that it is advisable and in the best interests of
The Chase Manhattan Corporation (the "Corporation") and its stockholders for the
Corporation to enter into the Agreement and Plan of Merger between the
Corporation and J.P. Morgan & Co. Incorporated, a Delaware corporation ("J.P.
Morgan"), substantially in the form presented to this Meeting (the "Merger
Agreement"), pursuant to which, among other things: (i) J.P. Morgan would merge
with and into the Corporation (the "Merger"); (ii) in accordance with the terms
and conditions of the Merger Agreement, each then outstanding share of common
stock, par value $2.50 per share, of J.P. Morgan ("J.P. Morgan Common Stock"),
other than shares which would be cancelled and retired and cease to exist as a
result of the Merger, would be converted into 3.70 fully paid and nonassessable
shares of common stock, par value $1.00 per share, of the Corporation (the
"Common Stock"); (iii) each then outstanding share of preferred stock, without
par value, of J.P. Morgan (the "J.P. Morgan Preferred Stock"), other than (A)
shares which would be cancelled and retired and cease to exist as a result of
the Merger and (B) shares as to which the holders have properly perfected any
rights of appraisal pursuant to Section 262 of the Delaware General Corporation
Law, shall be converted into a share of a corresponding series of preferred
stock, par value $1.00 per share, of the Corporation (the "Preferred Stock"), in
each case having
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substantially the same terms as the respective series of J.P. Morgan Preferred
Stock being so converted (such Preferred Stock of the Corporation to be so
issued being hereinafter referred to as the "Merger Preferred Stock"); and (iv)
the Corporation's Certificate of Incorporation would be amended pursuant to the
Merger Agreement and by virtue of the Merger to provide for (A) the change of
the name of the Corporation to "J.P. Morgan Chase & Co." and (B) the designation
of each series of Merger Preferred Stock; and further
RESOLVED, that subject to stockholder approval of the Merger
Agreement and to the filing with the Secretary of State of the State of Delaware
of the certificates of designations referred to below with respect to each
series of Merger Preferred Stock (collectively, the "Certificates of
Designation"), the issuance of such shares of Merger Preferred Stock in
accordance with the terms of the Merger Agreement be, and it hereby is,
authorized and, upon such issuance, such shares of Merger Preferred Stock shall
be validly issued, fully paid and nonassessable and free of preemptive rights;
and further
RESOLVED, that the maximum number of shares of each series of
Merger Preferred Stock authorized to be so issued in connection with the Merger
upon conversion of the respective series of J.P. Morgan Preferred Stock shall be
as follows: (i) up to 2,444,300 shares upon conversion of J.P. Morgan's
Adjustable Rate Cumulative Preferred Stock, Series A; (ii) up to 50,000 shares
upon conversion of J.P. Morgan's Variable Cumulative Preferred Stock, Series B;
(iii) up to 50,000 shares upon conversion of J.P. Morgan's Variable Cumulative
Preferred Stock, Series C; (iv) up to 50,000 shares upon conversion of J.P.
Morgan's Variable Cumulative Preferred Stock, Series D; (v) up to 50,000 shares
upon conversion of J.P. Morgan's Variable Cumulative Preferred Stock, Series E;
(vi) up to 50,000 shares upon conversion of J.P. Morgan's Variable Cumulative
Preferred Stock, Series F; and (vii) up to 400,000 shares upon conversion of
J.P. Morgan's 6 5/8% Cumulative Preferred Stock, Series H; and further
RESOLVED, that the voting powers, preferences and special
rights of each series of Merger Preferred Stock shall be substantially identical
to the voting powers, preferences and special rights applicable to, and
specified in the certificate of designations with respect to, the respective
series of J.P. Morgan Preferred Stock to be converted into such series of Merger
Preferred Stock pursuant to the Merger, and that the Certificate of Designation
for each series of Merger Preferred Stock shall provide for the voting rights
specified in the corresponding series of J.P. Morgan Preferred Stock; and
further
RESOLVED, that the Stock Committee of the Board of Directors
be, and it hereby is, authorized to approve, within the limits specified in the
foregoing resolutions, the form, terms and provisions of each Certificate of
Designation and to take such other actions as such committee deems necessary or
desirable to effect the issuance of the Merger Preferred Stock in accordance
with these resolutions.
2. The Stock Committee of the Board of Directors on December
18, 2000, pursuant to authority conferred upon the Stock Committee of the Board
of Directors by Section 141(c) of the General Corporation Law of the State of
Delaware, by Section 3.03 of the By-Laws of the Corporation and by the
resolutions of the Board of Directors set forth above, adopted the following
resolution:
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RESOLVED, that pursuant to resolutions of the Board of Directors of the
Corporation adopted on September 12, 2000, the issue of up to 2,429,300 shares
of Adjustable Rate Cumulative Preferred Stock, Series A, $1.00 par value, of the
Corporation is hereby authorized, and the designation, preferences and
privileges, relative, participating, optional and other special rights, and
qualifications of all 2,429,300 shares of this series, in addition to those set
forth in the Certificate of Incorporation are hereby fixed as follows:
1. Designation. The designation of such preferred stock shall
be Adjustable Rate Cumulative Preferred Stock, Series A (hereinafter referred to
as the "Series A Preferred Stock") and the number of shares constituting such
series is 2,429,300. Shares of the Series A Preferred Stock shall have a stated
value of $100 per share. The number of authorized shares of the Series A
Preferred Stock may be reduced by further resolution duly adopted by the Board
of Directors of the Corporation and by the filing of a certificate pursuant to
the provisions of the General Corporation Law of the State of Delaware stating
that such reduction has been so authorized, but the number of authorized shares
of the Series A Preferred Stock shall not be increased.
2. Dividends. Dividend rates on the shares of the Series A
Preferred Stock shall be for the period that commences on January 1, 2001 and
that shall end on and include March 31, 2001 (the "Initial Dividend Period") and
for each quarterly dividend period (hereinafter referred to as a "Quarterly
Dividend Period" and the Initial Dividend Period or any Quarterly Dividend
Period, being hereinafter individually referred to as a "Dividend Period" and
collectively as "Dividend Periods"), thereafter, which Quarterly Dividend
Periods shall commence on January 1, April 1, July 1 and October 1 in each year
and shall end on and include the day next preceding the first day of the next
Quarterly Dividend Period, at a rate per annum of the stated value thereof equal
to the Applicable Rate (as defined in Section 3) in respect of each Dividend
Period. Such dividends shall be cumulative from the first day of the Initial
Dividend Period and shall be payable, when and as declared by the Board of
Directors, on March 31, June 30, September 30 and December 31 of each year,
commencing with such date that is the last day of the Initial Dividend Period.
Each such dividend shall be paid to the holders of record of shares of the
Series A Preferred Stock as they appear on the stock register of the Corporation
on such record date, not exceeding 30 days preceding the payment date thereof,
as shall be fixed by the Board of Directors of the Corporation, or by a
committee of said Board of Directors duly authorized to fix such date. Dividends
on account of arrears for any past Dividend Periods may be declared and paid at
any time, without reference to any regular dividend payment date, to holders of
record on such date, not exceeding 45 days preceding the payment date thereof,
as may be fixed by the Board of Directors of the Corporation, or by a committee
of said Board of Directors duly authorized to fix such date. In the event that
there shall be outstanding shares of any other series of preferred stock ranking
on a parity as to dividends with the Series A Preferred Stock, the Corporation,
in making any dividend payment on account of arrears on the Series A Preferred
Stock or such other series of preferred stock, shall make payments ratably upon
all outstanding shares of the Series A Preferred Stock and such other series of
preferred stock in proportion to the respective amounts of dividends in arrears
upon all such outstanding shares of the Series A Preferred Stock and such other
series of preferred stock to the date of such dividend payment. No interest, or
sum of money in lieu of interest, shall be payable in respect of any dividend
payment or payments which may be in arrears. Dividends payable on the Series A
Preferred Stock for each full Dividend Period (including the Initial Dividend
Period) shall be computed by dividing the Applicable Rate by four. Dividends
payable on the Series A Preferred Stock for any
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period less than a full Dividend Period shall be computed on the basis of a 360
day year of four 90 day quarters and the actual number of days elapsed in the
period for which payable.
3. Definition of Applicable Rate, etc. Except as provided
below in this paragraph, the "Applicable Rate" for each Dividend Period shall be
(a) 4.875% less than (b) the highest of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Twenty Year Constant Maturity Rate (each as
hereinafter defined) for such Dividend Period. In the event that the Corporation
determines in good faith that for any reason:
(i) any one of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Twenty Year Constant Maturity
Rate cannot be determined for any Dividend Period, then the
Applicable Rate for such Dividend Period shall be 4.875% less
than the higher of whichever two of such Rates can be so
determined;
(ii) only one of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Twenty Year Constant Maturity
Rate can be determined for any Dividend Period, then the
Applicable Rate for such Dividend Period shall be 4.875% less
than whichever such Rate can be so determined; or
(iii) none of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate and the Twenty Year Constant Maturity
Rate can be determined for any Dividend Period, then the
Applicable Rate in effect for the preceding Dividend Period
shall be continued for such Dividend Period.
Anything herein to the contrary notwithstanding, the
Applicable Rate for any Dividend Period shall in no event be
less than 5.00% per annum or greater than 11.50% per annum.
Except as provided below in this paragraph, the
"Treasury Bill Rate" for each Dividend Period shall be the
arithmetic average of the two most recent weekly per annum
market discount rates (or the one weekly per annum market
discount rate, if only one such rate shall be published during
the relevant Calendar Period as provided below) for
three-month U.S. Treasury bills, as published weekly by the
Federal Reserve Board during the Calendar Period immediately
prior to the last ten calendar days of March, June, September
or December, as the case may be, prior to the Dividend Period
for which the dividend rate on the Series A Preferred Stock is
being determined. In the event that the Federal Reserve Board
does not publish such a weekly per annum market discount rate
during such Calendar Period, then the Treasury Bill Rate for
such Dividend Period shall be the arithmetic average of the
two most recent weekly per annum market discount rates (or the
one weekly per annum market discount rate, if only one such
rate shall be published during the relevant Calendar Period as
provided below) for three-month U.S. Treasury bills, as
published weekly during such Calendar Period by any Federal
Reserve Bank or by any U.S. Government department or agency
selected by the Corporation. In the event that a per annum
market discount rate for three-month U.S. Treasury bills shall
not be published by the Federal Reserve Board or by any
Federal Reserve Bank or by any U.S.
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Government department or agency during such Calendar Period,
then the Treasury Bill Rate for such Dividend Period shall be
the arithmetic average of the two most recent weekly per annum
market discount rates (or the one weekly per annum market
discount rate, if only one such rate shall be published during
the relevant Calendar Period as provided below) for all of the
U.S. Treasury bills then having maturities of not less than 80
nor more than 100 days, as finally published during such
Calendar Period by the Federal Reserve Board or, if the
Federal Reserve Board shall not publish such rates, by any
Federal Reserve Bank or by any U.S. Government department or
agency selected by the Corporation. In the event that the
Corporation determines in good faith that for any reason no
such U.S. Treasury bill rates are published as provided above
during such Calendar Period, then the Treasury Bill Rate for
such Dividend Period shall be the arithmetic average of the
per annum market discount rates based upon the closing bids
during such Calendar Period for each of the issues of
marketable non-interest bearing U.S. Treasury securities with
a maturity of not less than 80 nor more than 100 days from the
date of each such quotation, as quoted daily for each business
day in New York City (or less frequently if daily quotations
shall not be generally available) to the Corporation by at
least three recognized U.S. Government securities dealers
selected by the Corporation. In the event that the Corporation
determines in good faith that for any reason the Corporation
cannot determine the Treasury Bill Rate for any Dividend
Period as provided above in this paragraph, the Treasury Bill
Rate for such Dividend Period shall be the arithmetic average
of the per annum market discount rates based upon the closing
bids during such Calendar Period for each of the issues of
marketable interest-bearing U.S. Treasury securities with a
maturity of not less than 80 nor more than 100 days, as chosen
and quoted daily for each business day in New York City (or
less frequently if daily quotations shall not be generally
available) to the Corporation by at least three recognized
U.S. Government securities dealers selected by the
Corporation.
Except as provided below in this paragraph, the "Ten
Year Constant Maturity Rate" for each Dividend Period shall be
the arithmetic average of the two most recent weekly per annum
Ten Year Average Yields (or the one weekly per annum Ten Year
Average Yield, if only one such Yield shall be published
during the relevant Calendar Period as provided below), as
published weekly by the Federal Reserve Board during the
Calendar Period immediately prior to the last ten calendar
days of March, June, September or December, as the case may
be, prior to the Dividend Period for which the dividend rate
on the Preferred Stock is being determined. In the event that
the Federal Reserve Board does not publish such a weekly per
annum Ten Year Average Yield during such Calendar Period, then
the Ten Year Constant Maturity Rate for such Dividend Period
shall be the arithmetic average of the two most recent weekly
per annum Ten Year Average Yields (or the one weekly per annum
Ten Year Average Yield, if only one such Yield shall be
published during the relevant Calendar Period as provided
below), as published weekly during such Calendar Period by any
Federal Reserve Bank or by any U.S. Government department or
agency selected by the Corporation. In the event that a per
annum Ten Year Average Yield shall not be
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<PAGE> 13
published by the Federal Reserve Board or by any Federal
Reserve Bank or by any U.S. Government department or agency
during such Calendar Period, then the Ten Year Constant
Maturity Rate for such Dividend Period shall be the arithmetic
average of the two most recent weekly per annum average yields
to maturity (or the one weekly average yield to maturity, if
only one such yield shall be published during the relevant
Calendar Period as provided below) for all of the actively
traded marketable U.S. Treasury fixed interest rate securities
(other than Special Securities) then having maturities of not
less than eight nor more than twelve years, as finally
published during such Calendar Period by the Federal Reserve
Board or, if the Federal Reserve Board shall not publish such
yields, by any Federal Reserve Bank or by any U.S. Government
department or agency selected by the Corporation. In the event
that the Corporation determines in good faith that for any
reason the Corporation cannot determine the Ten Year Constant
Maturity Rate for any Dividend Period as provided above in
this paragraph, then the Ten Year Constant Maturity Rate for
such Dividend Period shall be the arithmetic average of the
per annum average yields to maturity based upon the closing
bids during such Calendar Period for each of the issues of
actively traded marketable U.S. Treasury fixed interest rate
securities (other than Special Securities) with a final
maturity date not less than eight nor more than twelve years
from the date of each such quotation, as chosen and quoted
daily for each business day in New York City (or less
frequently if daily quotations shall not be generally
available) to the Corporation by at least three recognized
U.S. Government securities dealers selected by the
Corporation.
Except as provided below in this paragraph, the
"Twenty Year Constant Maturity Rate" for each Dividend Period
shall be the arithmetic average of the two most recent weekly
per annum Twenty Year Average Yields (or the one weekly per
annum Twenty Year Average Yield, if only one such Yield shall
be published during the relevant Calendar Period as provided
below), as published weekly by the Federal Reserve Board
during the Calendar Period immediately prior to the last ten
calendar days of March, June, September or December, as the
case may be, prior to the Dividend Period for which the
dividend rate on the Series A Preferred Stock is being
determined. In the event that the Federal Reserve Board does
not publish such a weekly per annum Twenty Year Average Yield
during such Calendar Period, then the Twenty Year Constant
Maturity Rate for such Dividend Period shall be the arithmetic
average of the two most recent weekly per annum Twenty Year
Average Yields (or the one weekly per annum Twenty Year
Average Yield, if only one such Yield shall be published
during the relevant Calendar Period as provided below), as
published weekly during such Calendar Period by any Federal
Reserve Bank or by any U.S. Government department or agency
selected by the Corporation. In the event that a per annum
Twenty Year Average Yield shall not be published by the
Federal Reserve Board or by any Federal Reserve Bank or by any
U.S. Government department or agency during such Calendar
Period, then the Twenty Year Constant Maturity Rate for such
Dividend Period shall be the arithmetic average of the two
most recent weekly per annum average yields to maturity (or
the one weekly average yield to maturity, if only one such
yield shall be published during the relevant
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<PAGE> 14
Calendar Period as provided below) for all of the actively
traded marketable U.S. Treasury fixed interest rate securities
(other than Special Securities) then having maturities of not
less than eighteen nor more than twenty-two years, as finally
published during such Calendar Period by the Federal Reserve
Board or, if the Federal Reserve Board shall not publish such
yields, by any Federal Reserve Bank or by any U.S. Government
department or agency selected by the Corporation. In the event
that the Corporation determines in good faith that for any
reason the Corporation cannot determine the Twenty Year
Constant Maturity Rate for any Dividend Period as provided
above in this paragraph, then the Twenty Year Constant
Maturity Rate for such Dividend Period shall be the arithmetic
average of the per annum average yields to maturity based upon
the closing bids during such Calendar Period for each of the
issues of actively traded marketable U.S. Treasury fixed
interest rate securities (other than Special Securities) with
a final maturity date not less than eighteen nor more than
twenty-two years from the date of each such quotation, as
quoted daily for each business day in New York City (or less
frequently if daily quotations shall not be generally
available) to the Corporation by at least three recognized
U.S. Government securities dealers selected by the
Corporation.
The Treasury Bill Rate, the Ten Year Constant
Maturity Rate and the Twenty Year Constant Maturity Rate shall
each be rounded to the nearest five hundredths of a percentage
point.
The Applicable Rate with respect to each Dividend
Period shall be calculated as promptly as practicable by the
Corporation according to the appropriate method described
herein. The Corporation shall cause each Applicable Rate to be
published in a newspaper of general circulation in New York
City prior to the commencement of the Dividend Period to which
it applies and shall cause notice of such Applicable Rate to
be enclosed with the dividend payment checks next mailed to
the holder of the Series A Preferred Stock.
For purposes of this Section, the term
(i) "Calendar Period" shall mean 14 calendar days;
(ii) "Special Securities" shall mean securities which
can, at the option of the holder, be surrendered at face value
in payment of any Federal estate tax or which provide tax
benefits to the holder and are priced to reflect such tax
benefits or which were originally issued at a deep or
substantial discount;
(iii) "Ten Year Average Yield" shall mean the average
yield to maturity for actively traded marketable U.S. Treasury
fixed interest rate securities (adjusted to constant
maturities of ten years); and
(iv) "Twenty Year Yield" shall mean the average yield
to maturity for actively traded marketable U.S. Treasury fixed
interest rate securities (adjusted to constant maturities of
twenty years).
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<PAGE> 15
4. Redemption. The Corporation, at its option, may redeem the
Series A Preferred Stock, as a whole or in part, at any time or from time to
time, at a redemption price of $100.00 per share, plus, in each case, accrued
and unpaid dividends thereto to the date fixed for redemption.
In the event the Corporation shall redeem shares of Series A
Preferred Stock, notice of such redemption shall be given by first class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
redemption date, to each holder of record of the shares to be redeemed; at such
holder's address as the same appears on the stock register of the Corporation.
Each such notice shall state: (1) the redemption date; (2) the number of shares
of Series A Preferred Stock to be redeemed and, if less than all the shares held
by such holder are to be redeemed, the number of such shares to be redeemed from
such holder; (3) the redemption price; (4) the place or places where
certificates for such shares are to be surrendered for payment of the redemption
price; and (5) that dividends on the shares to be redeemed will cease to accrue
on such redemption date. Notice having been mailed as aforesaid, from and after
the redemption date (unless default shall be made by the Corporation in
providing money for the payment of the redemption price) dividends on the shares
of the Series A Preferred Stock so called for redemption shall cease to accrue,
and said shares shall no longer be deemed to be outstanding, and all rights of
the holders thereof as stockholders of the Corporation (except the right to
receive from the Corporation the redemption price) shall cease. Upon surrender
in accordance with said notice of the certificates for any shares so redeemed
(properly endorsed or assigned for transfer, if the Board of Directors of the
Corporation shall so require and the notice shall so state) such shares shall be
redeemed by the Corporation at the redemption price aforesaid. If less than all
the outstanding shares of the Series A Preferred Stock are to be redeemed,
shares to be redeemed shall be selected by the Corporation from outstanding
shares of Series A Preferred Stock not previously called for redemption by lot
or pro rata (as nearly as may be) or by any other method determined by the
Corporation in its sole discretion to be equitable. A new certificate shall be
issued representing the unredeemed shares without cost to the holder thereof.
Notwithstanding the foregoing provisions of this Section 4, if
any dividends on the Series A Preferred Stock are in arrears, no shares of the
Series A Preferred Stock shall be redeemed unless all outstanding shares of the
Series A Preferred Stock are simultaneously redeemed, and the Corporation shall
not purchase or otherwise acquire any shares of such Series; provided, however,
that the foregoing shall not prevent the purchase or acquisition of shares of
the Series A Preferred Stock pursuant to a purchase or exchange offer made on
the same terms to holders of all outstanding shares of the Series A Preferred
Stock.
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<PAGE> 16
5. Shares to be Retired. All shares of the Series A Preferred
Stock redeemed by the Corporation shall be retired and cancelled and shall be
restored to the status of authorized but unissued shares of preferred stock,
without designation as to series, and may thereafter be issued.
6. Conversion or Exchange. The holders of shares of the Series
A Preferred Stock shall not have any rights to convert such shares into or
exchange such shares for shares of any other class or classes or of any other
series of any class or classes of capital stock of the Corporation.
7. Voting. The Series A Preferred Stock shall have no voting
powers either general or special except as otherwise required by law and as
hereinafter provided in this Section 7.
If at the time of any annual meeting of stockholders for the
election of directors, the equivalent of six-quarterly dividends (whether or not
consecutive) payable on any share or shares of preferred stock are in default,
the number of directors constituting the Board of Directors of the Corporation
shall be increased by two. The holders of record of the Series A Preferred
Stock, voting separately as a class with the holders of shares of any one or
more other series of preferred stock upon which like voting rights have been
conferred (including, without limitations, the Corporation's Variable Cumulative
Preferred Stock, Series B through F, the 6 5/8% Cumulative Preferred Stock,
10.84% Cumulative Preferred Stock, Adjustable Rate Cumulative Preferred Stock,
Series L, Adjustable Rate Cumulative Preferred Stock, Series N (collectively the
"Outstanding Cumulative Preferred Stock")) shall be entitled at said meeting of
stockholders (and at each subsequent annual meeting of stockholders), unless all
dividends in arrears have been paid or declared and set apart for payment prior
thereto, to vote for the election of two directors of the Corporation, the
holders of any Series A Preferred Stock being entitled to cast one tenth (1/10)
of one vote and the holders of the Outstanding Cumulative Preferred Stock
entitled to cast one vote per share, with the remaining directors of the
Corporation to be elected by the holders of shares of any other class or classes
or series of stock entitled to vote therefor. Until the default in payments of
all dividends which permitted the election of said directors shall cease to
exist, any director who shall have been so elected pursuant to the next
preceding sentence may be removed at any time, either with or without cause,
only by the affirmative vote of the holders of the shares at the time entitled
to cast a majority of the votes entitled to be cast for the election of any such
director at a special meeting of such holders called for that purpose, and any
vacancy thereby created may be filled by the vote of such holders. If and when
such default shall cease to exist, the holders of the Series A Preferred Stock
and the holders of shares of any one or more series of preferred stock upon
which like voting rights have been conferred (including, without limitation, the
Outstanding Cumulative Preferred Stock) shall be divested of the foregoing
special voting rights, subject to revesting in the event of each and every
subsequent like default in payments of dividends. Upon the termination of the
foregoing special voting rights, the terms of office of all persons who may have
been elected directors pursuant to said special voting rights shall forthwith
terminate, and the number of directors constituting the Board of Directors shall
be reduced by two.
A-9
<PAGE> 17
Unless the vote or consent of the holders of a greater number
of shares shall then be required by law, the consent of the holders of record of
at least 66 2/3% of all of the Series A Preferred Stock and all other shares of
the same class at the time outstanding (including, without limitation, the
Outstanding Cumulative Preferred Stock and the Corporation's Fixed/Adjustable
Rate Noncumulative Preferred Stock (collectively, the "Other Preferred Stock")),
given in person or by proxy, either in writing or by a vote at a meeting called
for that purpose, voting as a class without regard to series, the holders of the
Series A Preferred Stock being entitled to cast one tenth (1/10) of one vote per
share and the holders of Other Preferred Stock entitled to cast one vote per
share, shall be necessary for authorizing, effecting or validating the
amendment, alteration or repeal of any of the provisions of the Restated
Certificate of Incorporation or of any certificate amendatory thereof or
supplemental thereto (including any Certificate of Designation, Preferences and
Rights or any similar document relating to any series of preferred stock) so as
to affect adversely the preferences, rights, powers or privileges of the Series
A Preferred Stock and any other shares of the same class (including, without
limitation, the Other Preferred Stock); provided, however, that in any case in
which one or more, but not all, series of Other Preferred Stock or Series A
Preferred Stock or other series of such class would be adversely affected as to
the preferences, rights, powers or privileges thereof, the affirmative consent
of holders of shares entitled to cast at least 66 2/3% of the votes entitled to
be cast by the holders of all of the shares of all of the series that would be
adversely affected, voting as a class, shall be required in lieu thereof.
Unless the vote or consent of the holders of a greater number
of shares shall then be required by law, the consent of the holders of record of
at least 66 2/3% of all of the shares of the Series A Preferred Stock and all
other series of preferred stock ranking on a parity (including, without
limitation, the Other Preferred Stock) with shares of the Series A Preferred
Stock, either as to dividends or upon liquidation, at the time outstanding,
given in person or by proxy, either in writing or by a vote at a meeting called
for the purpose at which the holders of shares of the Series A Preferred Stock,
the Other Preferred Stock and shares of such other series of preferred stock
shall vote together as a single class without regard to series, the holders of
the Series A Preferred Stock being entitled to cast one tenth (1/10) of one vote
and the holders of Other Preferred Stock being entitled to cast one vote per
share, shall be necessary to issue, authorize, or increase the authorized amount
of, or issue or authorize any obligation or security convertible into or
evidencing a right to purchase, any additional class or series of stock ranking
prior to the Series A Preferred Stock, Other Preferred Stock or such other
preferred stock as to dividends or upon liquidation.
8. Liquidation Preference. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation, the
holders of the Series A Preferred Stock shall be entitled to receive out of the
assets of the Corporation available for distribution to stockholders, before any
distribution of assets shall be made to the holders of Common Stock or of any
other shares of stock of the Corporation ranking as to such a distribution
junior to the Series A Preferred Stock, an amount equal to $100 per share plus
an amount equal to any accrued and unpaid dividends thereon (whether or not
earned or declared) to the date fixed for payment of such distribution. If upon
any voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, the amounts payable with respect to the Series A Preferred Stock
and any other shares of stock of the Corporation ranking as to any such
distribution on a parity with the Series A Preferred Stock are not paid in full,
the holders of the Series A Preferred Stock
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<PAGE> 18
and of such other shares shall share ratably in any such distribution of assets
of the Corporation in proportion to the full respective preferential amounts to
which they are entitled. After payment to the holders of the Series A Preferred
Stock of the full preferential amounts provided for in this Section 8, the
holders of the Series A Preferred Stock shall be entitled to no further
participation in any distribution of assets by the Corporation.
Neither the sale, conveyance, exchange or transfer of all or
substantially all the property or business of the Corporation, the merger or
consolidation of the Corporation into or with any other corporation nor the
merger or consolidation of any other corporation into or with the Corporation
shall be deemed to be a dissolution, liquidation or winding up, voluntary or
involuntary, of the Corporation for the purposes of this Section 8.
9. Limitation on Dividends on Junior Ranking Stock. So long as
any of the Series A Preferred Stock shall be outstanding, the Corporation shall
not declare any dividends on the Common Stock of the Corporation or any other
stock of the Corporation ranking as to dividends or distribution of assets
junior to the Series A Preferred Stock (as defined below, the "Junior Stock"),
or make any payment on account of, or set apart money for, a sinking or other
analogous fund for the purchase, redemption or other retirement of any shares of
Junior Stock, or make any distribution in respect thereof, whether in cash or
property or in obligations or stock of the Corporation, other than Junior Stock
(such dividends, payments, setting apart and distributions being herein called
"Junior Stock Payments"), unless full cumulative dividends shall have been paid
or declared and set apart for payment upon all outstanding shares of preferred
stock other than Junior Stock, at the date of such declaration in the case of
any such dividend, or the date of such setting apart in the case of any such
fund, or the date of such payment or distribution in the case of any other
Junior Stock Payment.
10. Ranking of Stock of the Corporation. For purposes of this
designation, any stock of any class or classes of the Corporation shall be
deemed to rank:
(1) prior to the shares of the Series A Preferred Stock,
either as to dividends or upon liquidation, if the holders of such
class or classes shall be entitled to the receipt of dividends or of
amounts distributable upon dissolution, liquidation or winding up of
the Corporation, as the case may be, in preference or priority to the
holders of shares of the Series A Preferred Stock;
(2) on a parity with shares of the Series A Preferred Stock,
either as to dividends or upon liquidation, whether or not the dividend
rates, dividend payment dates or redemption or liquidation prices per
share or sinking fund provisions, if any, be different from those of
the Series A Preferred Stock, if the holders of such stock shall be
entitled to the receipt of dividends or of amounts distributable upon
dissolution, liquidation or winding up of the Corporation, as the case
may be, in proportion to their respective dividend rates or liquidation
prices, without preference or priority, one over the other, as between
the holders of such stock and the holders of shares of the Series A
Preferred Stock; and
(3) junior to shares of the Series A Preferred Stock, either
as to dividends or upon liquidation, if such class shall be Common
Stock or if the holders of shares of the
A-11
<PAGE> 19
Series A Preferred Stock shall be entitled to receipt of dividends or
of amounts distributable upon dissolution, liquidation or winding up of
the Corporation, as the case may be, in preference or priority to the
holders of shares of such class or classes.
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<PAGE> 20
Appendix B
CERTIFICATE OF DESIGNATIONS
OF
VARIABLE CUMULATIVE PREFERRED STOCK, SERIES B THROUGH F
OF
J.P. MORGAN CHASE & CO.
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
J.P. MORGAN CHASE & CO., a corporation organized under the
laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES that the
following resolutions were duly adopted by the Board of Directors of the
Corporation at a meeting duly held and convened on September 12, 2000, and by
the Stock Committee of the Board of Directors by unanimous written consent
executed on December 18, 2000, pursuant to authority conferred upon the Board of
Directors by the provisions of the Restated Certificate of Incorporation of the
Corporation, which authorized the issuance of up to 200,000,000 shares of
preferred stock, par value $1.00 per share, and pursuant to authority conferred
upon the Stock Committee of the Board of Directors by Section 141(c) of the
General Corporation Law of the State of Delaware, by the By-Laws of the
Corporation and by the resolutions of the Board of Directors adopted at a
meeting duly convened and held on September 12, 2000:
1. The Board of Directors on September 12, 2000 adopted the
following resolutions authorizing the Stock Committee of the Board of Directors
to act on behalf of the Board of Directors in connection with the issuance of
Preferred Stock pursuant to the terms and conditions of the Agreement and Plan
of Merger, dated as of September 12, 2000, between J.P. Morgan & Co.
Incorporated, a Delaware corporation ("J.P. Morgan") and the Corporation, which
provided for the merger of J.P. Morgan with and into the Corporation, with the
Corporation continuing as the surviving corporation in the merger under the name
"J.P. Morgan Chase & Co.":
RESOLVED, that it is advisable and in the best interests of
The Chase Manhattan Corporation (the "Corporation") and its stockholders for the
Corporation to enter into the Agreement and Plan of Merger between the
Corporation and J.P. Morgan & Co. Incorporated, a Delaware corporation ("J.P.
Morgan"), substantially in the form presented to this Meeting (the "Merger
Agreement"), pursuant to which, among other things: (i) J.P. Morgan would merge
with and into the Corporation (the "Merger"); (ii) in accordance with the terms
and conditions of the Merger Agreement, each then outstanding share of common
stock, par value $2.50 per share, of J.P. Morgan ("J.P. Morgan Common Stock"),
other than shares which would be cancelled and retired and cease to exist as a
result of the Merger, would be converted into 3.70 fully paid and nonassessable
shares of common stock, par value $1.00 per share, of the Corporation (the
"Common Stock"); (iii) each then outstanding share of preferred stock, without
par value, of J.P. Morgan (the "J.P. Morgan Preferred Stock"), other than (A)
shares which would be cancelled and retired and cease to exist as a result of
the Merger and (B) shares as to which the holders have properly perfected any
rights of appraisal pursuant to Section 262 of the Delaware General Corporation
Law, shall be converted into a share of a corresponding series of preferred
stock, par
B-1
<PAGE> 21
value $1.00 per share, of the Corporation (the "Preferred Stock"), in each case
having substantially the same terms as the respective series of J.P. Morgan
Preferred Stock being so converted (such Preferred Stock of the Corporation to
be so issued being hereinafter referred to as the "Merger Preferred Stock"); and
(iv) the Corporation's Certificate of Incorporation would be amended pursuant to
the Merger Agreement and by virtue of the Merger to provide for (A) the change
of the name of the Corporation to "J.P. Morgan Chase & Co." and (B) the
designation of each series of Merger Preferred Stock; and further
RESOLVED, that subject to stockholder approval of the Merger
Agreement and to the filing with the Secretary of State of the State of Delaware
of the certificates of designations referred to below with respect to each
series of Merger Preferred Stock (collectively, the "Certificates of
Designation"), the issuance of such shares of Merger Preferred Stock in
accordance with the terms of the Merger Agreement be, and it hereby is,
authorized and, upon such issuance, such shares of Merger Preferred Stock shall
be validly issued, fully paid and nonassessable and free of preemptive rights;
and further
RESOLVED, that the maximum number of shares of each series of
Merger Preferred Stock authorized to be so issued in connection with the Merger
upon conversion of the respective series of J.P. Morgan Preferred Stock shall be
as follows: (i) up to 2,444,300 shares upon conversion of J.P. Morgan's
Adjustable Rate Cumulative Preferred Stock, Series A; (ii) up to 50,000 shares
upon conversion of J.P. Morgan's Variable Cumulative Preferred Stock, Series B;
(iii) up to 50,000 shares upon conversion of J.P. Morgan's Variable Cumulative
Preferred Stock, Series C; (iv) up to 50,000 shares upon conversion of J.P.
Morgan's Variable Cumulative Preferred Stock, Series D; (v) up to 50,000 shares
upon conversion of J.P. Morgan's Variable Cumulative Preferred Stock, Series E;
(vi) up to 50,000 shares upon conversion of J.P. Morgan's Variable Cumulative
Preferred Stock, Series F; and (vii) up to 400,000 shares upon conversion of
J.P. Morgan's 6 5/8% Cumulative Preferred Stock, Series H; and further
RESOLVED, that the voting powers, preferences and special
rights of each series of Merger Preferred Stock shall be substantially identical
to the voting powers, preferences and special rights applicable to, and
specified in the certificate of designations with respect to, the respective
series of J.P. Morgan Preferred Stock to be converted into such series of Merger
Preferred Stock pursuant to the Merger, and that the Certificate of Designation
for each series of Merger Preferred Stock shall provide for the voting rights
specified in the corresponding series of J.P. Morgan Preferred Stock; and
further
RESOLVED, that the Stock Committee of the Board of Directors
be, and it hereby is, authorized to approve, within the limits specified in the
foregoing resolutions, the form, terms and provisions of each Certificate of
Designation and to take such other actions as such committee deems necessary or
desirable to effect the issuance of the Merger Preferred Stock in accordance
with these resolutions.
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<PAGE> 22
2. The Stock Committee of the Board of Directors on December
18, 2000, pursuant to authority conferred upon the Stock Committee of the Board
of Directors by Section 141(c) of the General Corporation Law of the State of
Delaware, by Section 3.03 of the By-Laws of the Corporation and by the
resolutions of the Board of Directors set forth above, adopted the following
resolution:
RESOLVED, that pursuant to resolutions of the Board of
Directors of the Corporation adopted on September 12, 2000, the issue of (i) up
to 50,000 shares upon conversion of J.P. Morgan's Variable Cumulative Preferred
Stock, Series B; (ii) up to 50,000 shares upon conversion of J.P. Morgan's
Variable Cumulative Preferred Stock, Series C; (iii) up to 50,000 shares upon
conversion of J.P. Morgan's Variable Cumulative Preferred Stock, Series D; (iv)
up to 50,000 shares upon conversion of J.P. Morgan's Variable Cumulative
Preferred Stock, Series E; and (v) up to 50,000 shares upon conversion of J.P.
Morgan's Variable Cumulative Preferred Stock, Series F; of the Corporation is
hereby authorized, and the designation, preferences and privileges, relative,
participating, optional and other special rights, and qualifications of all the
shares of such series are hereby fixed as follows:
1. Designation. The designation of such preferred stock shall
be the Variable Cumulative Preferred Stock (hereinafter referred to as the
"Variable Cumulative Preferred Stock") and the number of shares constituting
such Variable Cumulative Preferred Stock is 250,000. Each share shall constitute
a series, and there shall be five groups each comprising 50,000 series (each
group a "Series"), such Series to be designated the Variable Cumulative
Preferred Stock, Series B-1 through B-50,000 (hereinafter referred to as "Series
B"), Variable Cumulative Preferred Stock, Series C-1 through C-50,000
(hereinafter referred to as "Series C"), Variable Cumulative Preferred Stock,
Series D-1 through D-50,000 (hereinafter referred to as "Series D"), Variable
Cumulative Preferred Stock, Series E-1 through E-50,000 (hereinafter referred to
as "Series E"), and Variable Cumulative Preferred Stock, Series F-1 through
F-50,000 (hereinafter referred to as "Series F"). Shares of the Variable
Cumulative Preferred Stock shall have a stated value of $1,000 per share.
2. Definitions. As used herein, the following terms shall
have the following meanings, unless the context otherwise requires:
"Affiliate" shall mean any Person controlled by, in control
of, or under common control with, the Corporation.
"Agent Member" shall mean the member of the Auction Stock
Depositary that will act on behalf of a Bidder and is identified as such in such
Bidder's Master Purchaser's Letter.
"Applicable Determining Rate" shall mean with respect to a
Dividend Period from 1 day to 5 days, the greater of the Effective Composite
Commercial Paper Rate for commercial paper of a term of 5 days and the Federal
Funds Rate; with respect to a Dividend Period of 6 days to 89 days, the
Effective Composite Commercial Paper Rate; with respect to a Dividend Period of
90 days to 364 days, the Effective LIBOR Rate; and with respect to a Dividend
Period of 365 days to 30 years, the U.S. Treasury Rate.
B-3
<PAGE> 23
"Auction" shall mean the periodic implementation of the
Auction Procedures.
"Auction Date" shall mean the Business Day immediately
preceding the first day of a Dividend Period for MMP.
"Auction Method" shall mean the method of determining the
duration of Dividend Periods and Dividend Rates for the Shares of Variable
Cumulative Preferred Stock of a Series pursuant to the procedures described in
paragraph D of Section 5 hereof.
"Auction Procedures" shall mean the procedures for conducting
Auctions set forth in Section 6 hereof.
"Auction Stock Depositary" shall mean any securities
depositary selected by the Corporation and reasonably acceptable to the Trust
Company which agrees to follow the procedures required to be followed by such
securities depositary in connection with the Auction of Shares of MMP.
"Available Shares" shall have the meaning specified in
paragraph C(1)(a) of Section 6 hereof.
"Bid" and "Bids" shall have the respective meanings specified
in paragraph A(2) of Section 6 hereof.
"Bidder" and "Bidders" shall have the respective meanings
specified in paragraph A(2) of Section 6 hereof.
"Board of Directors" shall mean the Board of Directors of the
Corporation or, unless the context otherwise requires, an authorized committee
thereof.
"Broker-Dealer" shall mean any broker-dealer, or other entity
permitted by law to perform the function required of a Broker-Dealer in the
Auction Procedures, that is a member of, or a participant in, the Auction Stock
Depositary, and that has been selected by the Corporation and has entered into a
Broker-Dealer Agreement with the Trust Company that remains effective and
pursuant to which agreement such Broker-Dealer agrees to follow the Auction
Procedures.
"Business Day" shall mean a day on which the New York Stock
Exchange, Inc. is open for trading and which is neither a Saturday, Sunday nor
other day on which banks in The City of New York, New York, are authorized by
law to close.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Converted MMP" shall mean Shares of MMP which, by reason of
an election by the Method Selection Agent of a different Dividend Determination
Method, will become SABRES at the end of the then-current Dividend Period
applicable thereto.
"Converted SABRES" shall mean Shares of SABRES which, by
reason of an election by the Method Selection Agent of a different Dividend
Determination Method, will become MMP at the end of the then-current Dividend
Period applicable thereto.
B-4
<PAGE> 24
"Corporation" shall mean The Chase Manhattan Corporation, a
Delaware corporation, and where the context requires with respect to periods
prior to the Effective Time, shall also be deemed to refer to J.P. Morgan & Co.
Incorporated, a Delaware corporation ("J.P. Morgan") prior to the Effective
Time.
"Dividend Determination Method" or "Method" shall mean either
the Auction Method or the Remarketing Method.
"Dividend Payment Date" shall mean, with respect to each Share
of Variable Cumulative Preferred Stock, the first Business Day of the Subsequent
Dividend Period immediately following the end of each Dividend Period applicable
thereto, regardless of its length. In addition, "Dividend Payment Date" shall
mean (i) in the case of Dividend Periods for MMP of any Series of more than 99
days, such additional Dividend Payment Dates as are determined by the Term
Selection Agent for such Series prior to commencement of such Dividend Periods
and (ii) in the case of Dividend Periods for SABRES of more than 99 days, the
following additional dates: (a) if such Dividend Period is from 100 to 190 days,
the 9lst day of such Dividend Period; (b) if such Dividend Period is from 191 to
281 days, the 91st and 182nd days of such Dividend Period; (c) if such Dividend
Period is from 282 to 364 days, the 91st, 182nd and 273rd days of such Dividend
Period; and (d) if such Dividend Period is from 365 days to 30 years, January
15, April 15, July 15 and October 15 of each year. However, in all such cases,
if such Dividend Payment Date is not a Business Day, then such Dividend Payment
Date shall be the Business Day next succeeding such date and, so long as the
Auction Stock Depositary shall make payments to participants and members in
next-day funds, if a day that otherwise would be a Dividend Payment Date for
Shares of MMP is succeeded by a day which is not a Business Day then the
Dividend Payment Date will be the next succeeding Business Day that is
immediately succeeded by a Business Day.
"Dividend Period" and "Dividend Periods" shall mean, as to
each Share of Variable Cumulative Preferred Stock, each period, to which one or
more Dividend Payment Dates may relate, with respect to which dividends on such
Share shall accumulate and be payable, each such Dividend Period to be
determined pursuant to either the Auction Method or the Remarketing Method
(except as provided otherwise in Section 5.B with respect to the Initial
Dividend Period).
"Dividend Rate" and "Dividend Rates" shall mean, as to each
Share of Variable Cumulative Preferred Stock, each rate at which dividends
accumulate and are payable on such Share during a Dividend Period, such Dividend
Rate to be determined pursuant to either the Auction Method or the Remarketing
Method (except as provided otherwise in Section 5.B with respect to the Initial
Dividend Period).
"Effective Composite Commercial Paper Rate" shall mean, on any
date, (i) the Money Market Yield of the rate on commercial paper placed on
behalf of issuers whose corporate bonds are rated "AA" by Standard & Poor's or
"Aa" by Moody's or the equivalent of such rating by another nationally
recognized rating agency, for a maturity that equals the duration of the
relevant Dividend Period as such rate is made available on a discount basis or
otherwise by the Federal Reserve Bank of New York on such date, or (ii) in the
event that the Federal Reserve Bank of New York does not make available such a
rate by 2:00 P.M., New York
B-5
<PAGE> 25
City time, on such date, the Money Market Yield of the arithmetic mean of the
rates on commercial paper of such maturity placed on behalf of such issuers, as
quoted on a discount basis or otherwise by Lehman Commercial Paper Incorporated,
Credit Suisse First Boston Corporation or Goldman, Sachs & Co., or, in lieu of
any thereof, their respective affiliates or successors that are commercial paper
dealers (the "Commercial Paper Dealers"), to the Trust Company or the Tender
Agent, as the case may be, for the close of business on the Business Day
immediately preceding such date. In the event that the Federal Reserve Bank of
New York does not make available such a rate and if any Commercial Paper Dealer
does not quote a rate required to determine the Effective Composite Commercial
Paper Rate, the Effective Composite Commercial Paper Rate shall be determined on
the basis of the quotation or quotations furnished by the remaining Commercial
Paper Dealer or Commercial Paper Dealers and any Substitute Commercial Paper
Dealer or Substitute Commercial Paper Dealers selected by the Corporation to
provide such rate or rates not being supplied by any Commercial Paper Dealer or
Commercial Paper Dealers, as the case may be, or, if the Corporation does not
select any such Substitute Commercial Paper Dealer or Substitute Commercial
Paper Dealers, by the remaining Commercial Paper Dealer or Commercial Paper
Dealers. "Substitute Commercial Paper Dealers" shall mean Merrill Lynch, Pierce,
Fenner & Smith Incorporated or Citibank N.A., or, in lieu of either thereof,
their respective affiliates or successors that are commercial paper dealers. In
the event that no quoted rates are available for a maturity that equals the
duration of the relevant Dividend Period, then the rate will be the higher of
the quoted rate for the maturity immediately shorter or immediately longer than
the duration of the relevant Dividend Period.
"Effective LIBOR Rate" shall mean, on any date, the offered
rates for deposits in dollars for a period of the same duration as the relevant
Dividend Period, which appear on the Reuters Screen LIBO Page as of 11:00 A.M.,
London time, on such date. If at least two such offered rates appear on the
Reuters Screen LIBO Page, the Effective LIBOR Rate in respect of such date will
be the arithmetic mean of such offered rates. If fewer than two offered rates
appear, the Effective LIBOR Rate in respect of such date will be determined on
the basis of the rates quoted to the Trust Company or the Tender Agent, as the
case may be, at which deposits in dollars are offered by the Reference Banks (as
hereinafter defined) at approximately 11:00 A.M., London time, on the day that
is the Business Day preceding such date to prime banks in the London interbank
market for a period of the same duration as the relevant Dividend Period. The
Corporation shall request the principal London office of each of the Reference
Banks to provide a quotation of such rate to the Trust Company or the Tender
Agent, as the case may be. If at least two such quotations are provided, the
Effective LIBOR Rate in respect of such date will be the arithmetic mean of the
quotations. If fewer than two quotations are provided as requested, the
Effective LIBOR Rate in respect of such date will be the arithmetic mean of the
rates quoted to the Trust Company or Tender Agent, as the case may be, by major
banks in New York City, selected by the Corporation, at approximately 11:00
A.M., New York City time, on such date for loans in dollars to leading European
banks for a period of the same duration as the relevant Dividend Period.
"Reference Banks" means four major banks in the London interbank market,
selected by the Corporation, and may include Morgan Guaranty Trust Company of
New York or any successor thereto or affiliate thereof. In the event that no
quoted rates are available for a maturity that equals the duration of the
relevant Dividend Period, then the rate will be the higher of the quoted rate
for the maturity immediately shorter or immediately longer than the duration of
the relevant Dividend Period.
B-6
<PAGE> 26
"Effective Time" shall mean the effective time of the merger
of J.P. Morgan & Co. Incorporated with and into the Corporation pursuant to the
Agreement and Plan of Merger dated as of September 12, 2000 between the
Corporation and J.P. Morgan & Co. Incorporated.
"Existing Holder" shall mean, with respect to Shares of MMP, a
Person who has signed a Master Purchaser's Letter and is listed as the
beneficial owner of such Shares of MMP in the records of the Trust Company and
will in all events include holders of Converted SABRES.
"Federal Funds Rate" shall mean, on any date (i) the overnight
Federal funds rate as such rate is made available by the Federal Reserve Bank of
New York or (ii) in the event that the Federal Reserve Bank of New York does not
make available such a rate by 2:00 P.M., New York City time, on any day, the
arithmetic mean of the rates for the last transaction in overnight Federal funds
arranged prior to 9:00 A.M., New York City time, on that day by each of three
leading brokers of Federal funds transactions in New York City as selected by
the Corporation.
"Fixed/Adjustable Preferred Stock" shall mean the
Fixed/Adjustable Rate Noncumulative Preferred Stock, stated value $50 per share
(par value $1 per share), of the Corporation.
"Hold Order" and "Hold Orders" shall have the respective
meanings specified in paragraph A(2) of Section 6 hereof.
"Initial Auction Date" shall mean the Business Day immediately
preceding the first day of a Dividend Period for Converted SABRES.
"Initial Dividend Period" shall mean, for each Share of
Variable Cumulative Preferred Stock, the initial Dividend Period applicable to
such Share, which period (1) shall commence on the Dividend Payment Date that
began the Dividend Period that was the last Dividend Period to begin prior to
the Effective Time with respect to J.P. Morgan's Variable Cumulative Preferred
Stock, Series B; J.P. Morgan's Variable Cumulative Preferred Stock, Series C;
J.P. Morgan's Variable Cumulative Preferred Stock, Series D; J.P. Morgan's
Variable Cumulative Preferred Stock, Series E; or J.P. Morgan's Variable
Cumulative Preferred Stock, Series F (collectively referred to as the "J.P.
Morgan Variable Preferred Stock"), as the case may be, which was converted into
such Share, and (2) shall end on and include the day next preceding the first
day of the next applicable Dividend Period.
"Junior Stock" shall mean all stock of the Corporation now or
hereafter authorized, except (i) the Variable Cumulative Preferred Stock, (ii)
the Series A Preferred Stock, (iii) the 6 5/8% Preferred Stock, (iv) the 10.84%
Preferred Stock, (iv) the Series L Preferred Stock, (v) the Series N Preferred
Stock, (vi) the Fixed/Adjustable Preferred Stock and (vii) any future class of
stock ranking prior to or on a parity with the Variable Cumulative Preferred
Stock as to dividends or distributions upon liquidation.
"Master Purchaser's Letter" shall mean a letter addressed to
the Corporation, the Trust Company, a Remarketing Agent, and an Agent Member in
which a Person agrees, among other things, that if such Person should offer to
purchase, purchase, offer to sell and/or sell Shares of a Series of Variable
Cumulative Preferred Stock, such Person will be bound by the
B-7
<PAGE> 27
Auction Procedures and the Remarketing Procedures; such letter to be in
substantially the form set forth as Exhibit C to the Trust Company Agreement,
dated as of December 15, 1989, between the Corporation and Bankers Trust
Company, or in such other form as may be agreed (i) with respect to MMP, by the
Corporation and the Trust Company and (ii) with respect to SABRES, by the
Corporation and the applicable Remarketing Agent.
"Maximum Rate" shall mean, on any date, with respect to any
Share of Variable Cumulative Preferred Stock, the product of the percentage
(determined as set forth below based on the prevailing rating of such Share of
Variable Cumulative Preferred Stock in effect at the close of business on the
second Business Day immediately preceding such date) and the Applicable
Determining Rate for such Share on such date:
<TABLE>
<CAPTION>
Percentage of Applicable
Prevailing Rating Determining Rate
------------------ ------------------------
<S> <C>
AA-/"aa3" or above 110%
A-/"a3" 125%
BBB-/"baa3" 150%
Below BBB-/"baa3" 200%
</TABLE>
For purposes of this definition, the "prevailing rating" of
each Series of Variable Cumulative Preferred Stock shall be (i) AA-/"aa3" or
above, if the Shares of such Series of Variable Cumulative Preferred Stock have
a rating of AA-or better by Standard & Poor's or "aa3" or better by Moody's or
the equivalent of either of such ratings by a substitute rating agency or
agencies selected as provided below, (ii) if not AA-/"aa3" or above, then
A-/"a3" if the Shares of such Series of Variable Cumulative Preferred Stock have
a rating of A-or better by Standard & Poor's or "a3" or better by Moody's or the
equivalent of either of such ratings by a substitute rating agency or agencies
selected as provided below, (iii) if not AA-/"aa3" or above or A-/"a3" then
BBB-/"baa3" if the Shares of such Series of Variable Cumulative Preferred Stock
have a rating of BBB- or better by Standard & Poor's or "baa3" or better by
Moody's or the equivalent of either of such ratings by a substitute rating
agency or agencies selected as provided below, and (iv) if not AA-/"aa3" or
above, A-/"a3" or BBB-/"baa3" then below BBB-/"baa3". The Corporation will take
all reasonable action necessary to enable Standard & Poor's and Moody's to
provide a rating for each Series of the Variable Cumulative Preferred Stock. If
either Standard & Poor's or Moody's fails to make such a rating available, the
Corporation or its duly authorized agent will select one or two nationally
recognized securities rating agencies to act as a substitute rating agency or
agencies, as the case may be. If an alternative nationally recognized securities
rating agency or agencies are not available, the applicable rating shall be the
highest rating last published by Standard & Poor's, Moody's or such substitute
rating agency or agencies.
"Method Selection Agent" shall mean at any time the entity
appointed by the Corporation to act on its behalf in selecting Dividend
Determination Methods for a Series of Variable Cumulative Preferred Stock,
provided that, if the Corporation shall appoint more than one entity to so act
with respect to a Series, "Method Selection Agent" shall mean, unless the
context otherwise requires, all entities so appointed.
B-8
<PAGE> 28
"Money Market Yield" shall mean, with respect to any rate
which is quoted on a bank discount basis, a yield (expressed as a percentage)
calculated in accordance with the following formula:
Money Market Yield = D x 360 x 100
-----------------
360 - (D x M)
where "D" refers to the per annum rate, quoted on a bank
discount basis and expressed as a decimal; and "M" refers to the number of days
for which such bank discount rate is quoted.
"MMP" shall mean the Shares of Variable Cumulative Preferred
Stock for which the Dividend Rate and Dividend Period are determined, other than
during a Payment Failure, pursuant to the Auction Method and during a Payment
Failure, "MMP" shall mean the Shares of Variable Cumulative Preferred Stock
which were MMP immediately preceding such Payment Failure.
"Moody's" shall mean Moody's Investors Service and its
successors.
"Notice of Method Selection" shall mean a notice from the
applicable Method Selection Agent to all record holders of Shares of Variable
Cumulative Preferred Stock of a Series specifying the Dividend Determination
Method for any Subsequent Dividend Period with respect to all Shares of such
Series.
"Notice of Removal" shall mean a notice from the Corporation
to all record holders of Shares of Variable Cumulative Preferred Stock of a
Series specifying that each Term Selection Agent or Method Selection Agent, as
the case may be, with respect to such Series has been removed by the
Corporation.
"Notice of Term Selection" shall mean a notice from the
applicable Term Selection Agent to all record holders of Shares of MMP or
Converted SABRES of a Series specifying, among other things, the length of the
next succeeding Dividend Period with respect to such Series.
"Notice of Withdrawal" shall mean a notice from the applicable
Term Selection Agent to all record holders of Shares of MMP or Converted SABRES
of a Series specifying that the Notice of Term Selection previously sent to
record holders of Shares of such Series has been withdrawn.
"Order" and "Orders" shall have the respective meanings
specified in paragraph A(2) of Section 6 hereof.
"Other Outstanding Preferred Stock" shall mean the Series A
Preferred Stock, the 6 5/8% Preferred Stock, the Series L Preferred Stock, the
Series N Preferred Stock, the 10.84% Cumulative Preferred Stock, and the
Fixed/Adjustable Preferred Stock.
"Outstanding" shall mean, as of any date, Shares of a Series
of Variable Cumulative Preferred Stock theretofore issued by the Corporation
except (i) any Shares of such
B-9
<PAGE> 29
Series of Variable Cumulative Preferred Stock theretofore cancelled or delivered
for cancellation or redeemed by the Corporation, or as to which a notice of
redemption shall have been given by the Corporation (unless the Corporation
defaults in providing money for the payment of the redemption price of such
Shares within three Business Days following the redemption date therefor), (ii)
any Shares of such Series of Variable Cumulative Preferred Stock as to which the
Corporation or any Affiliate thereof shall be an owner (except that any Shares
acquired by an Affiliate which is a Broker-Dealer and which acquired such Shares
in the normal course of its business shall be deemed to be Outstanding), or
(iii) any Shares of such Series of Variable Cumulative Preferred Stock
represented by any certificate in lieu of which a new certificate has been
executed and delivered by the Corporation.
"Outstanding Cumulative Preferred Stock" shall mean the Series
A Preferred Stock, the 6 5/8% Preferred Stock, the Series L Preferred Stock, the
Series N Preferred Stock and the 10.84% Preferred Stock.
"Paying Agent" shall mean a bank or trust company duly
appointed as such Paying Agent.
"Payment Failure" shall mean any failure by the Corporation to
pay (or set aside for payment): (i) any dividends in respect of any Share of
Variable Cumulative Preferred Stock which have accumulated during any Dividend
Period applicable to such Share on the last Dividend Payment Date with respect
to such Dividend Period or (ii) the redemption price in respect of Shares of
Variable Cumulative Preferred Stock called for redemption on the date of
redemption, provided that, in the case of either clause (i) or (ii) above, such
failure shall continue unremedied for more than three Business Days.
"Person" shall mean and include an individual, a partnership,
a corporation, a trust, an unincorporated association, a joint venture or other
entity or a government or any agency or political subdivision thereof.
"Potential Holder" shall mean, with respect to Shares of MMP,
any Person, including any Existing Holder, (i) who shall have executed a Master
Purchaser's Letter and (ii) who may be interested in acquiring Shares of MMP
(or, in the case of an Existing Holder, acquiring additional Shares of MMP).
"Remaining Shares" shall have the meaning specified in
paragraph D(1)(d) of Section 6 hereof.
"Remarketing" shall mean the periodic implementation of the
Remarketing Procedures.
"Remarketing Agent" shall mean, at any time, the entity or
entities appointed by the Corporation to act on its behalf in establishing
Dividend Rates, Dividend Periods, redemption prices and redemption dates for
Shares of SABRES of a Series and to act on behalf of holders of such Shares in
Remarketing such Shares as provided in the Remarketing Procedures.
B-10
<PAGE> 30
"Remarketing Agreement" shall mean an agreement between the
Corporation and a Remarketing Agent pursuant to which a Remarketing Agent agrees
to follow the Remarketing Procedures.
"Remarketing Conditions" shall mean the following factors: (i)
short-term and long-term market rates and indices of such short-term and
long-term rates, (ii) market supply and demand for short-term and long-term
securities, (iii) yield curves for short-term and long-term securities
comparable to the Shares of Variable Cumulative Preferred Stock, (iv) industry
and financial conditions which may affect the Shares of Variable Cumulative
Preferred Stock, (v) the number of Shares of Variable Cumulative Preferred Stock
to be sold pursuant to an Auction or a Remarketing, as the case may be, (vi) the
number of potential purchasers of Variable Cumulative Preferred Stock, (vii) the
Dividend Periods and Dividend Rates at which current and potential holders of
Variable Cumulative Preferred Stock would remain or become holders, (viii)
current tax laws and administrative interpretations with respect thereto and
(ix) discussions with the Corporation about its current and projected funding
requirements based on its asset and liability position, tax position and current
financing objectives.
"Remarketing Method" shall mean a method of determining the
duration of Dividend Periods and Dividend Rates for the Shares of Variable
Cumulative Preferred Stock of a Series pursuant to the Remarketing Procedures,
as described in paragraph E of Section 5 hereof.
"Remarketing Procedures" shall mean the procedures for
Remarketing Shares of SABRES set forth in Section 7 hereof.
"Rounding Procedures" shall mean, if as a result of an Auction
(including the implementation of the Auction Procedures), any Existing Holder
would be entitled to hold or required to sell, or any Potential Holder would be
required to purchase, a number of Shares of MMP not evenly divisible by 100, on
any Auction Date, the Trust Company shall, in such manner as it determines,
round up or down the number of Shares of MMP to be held, purchased or sold by
each Existing Holder or Potential Holder on such Auction Date so that the number
of Shares of MMP held, purchased or sold by each Existing Holder or Potential
Holder on such Auction Date will be a number of Shares of MMP evenly divisible
by 100, even if such allocation results in one or more of such Potential Holders
not purchasing any Shares of MMP on such Auction Date.
"SABRES" shall mean the Shares of Variable Cumulative
Preferred Stock for which the Dividend Rate and Dividend Period are determined,
other than during a Payment Failure, pursuant to the Remarketing Method and
during a Payment Failure, "SABRES" shall mean the Shares of Variable Cumulative
Preferred Stock which were SABRES immediately preceding such Payment Failure.
"SABRES Depositary" shall mean any depositary selected by the
Corporation which agrees to follow the procedures required to be followed by
such depositary in connection with the Shares of SABRES.
"Sell Order" and "Sell Orders" shall have the respective
meanings specified in paragraph A(2) of Section 6 hereof.
B-11
<PAGE> 31
"Series" shall mean each group of series of Shares of Variable
Cumulative Preferred Stock, of 50,000 Shares each, designated Series B, Series
C, Series D, Series E and Series F, respectively.
"Series A Preferred Stock" shall mean the Adjustable Rate
Cumulative Preferred Stock, Series A, stated value $100 per share (par value $1
per share), of the Corporation.
"Series L Preferred Stock" shall mean the Adjustable Rate
Cumulative Preferred Stock, Series L, stated value $100 per share (par value $1
per share), of the Corporation.
"Series N Preferred Stock" shall mean the Adjustable Rate
Cumulative Preferred Stock, Series N, stated value $100 per share (par value $1
per share), of the Corporation.
"Shares" shall mean the shares of any or all Series of
Variable Cumulative Preferred Stock. As the context requires with respect to any
Share, a reference to such "Share" prior to the Effective Time shall be deemed
to refer to the share of preferred stock of J.P. Morgan & Co. Incorporated that
was converted into such Share of the Corporation at the Effective Time.
"Standard & Poor's" shall mean Standard & Poor's Rating
Services and its successors.
"Standard Auction Period" shall mean 49 days, provided that,
if there is a change in tax law altering the holding period specified in Section
246(c) of the Code or any successor provision thereto, the Board of Directors
may increase or decrease the period of time theretofore constituting the
Standard Auction Period so as to adjust uniformly the number of days in the
Standard Auction Period for Dividend Periods commencing after the date of such
change in law to equal or exceed the then-current holding period specified in
Section 246(c) of the Code or any successor provision thereto, and such period
as so adjusted shall be the Standard Auction Period; and provided further that
the number of days as so adjusted shall not exceed 98 and shall be evenly
divisible by 7.
"Submission Deadline" shall mean 1:00 P.M., New York City
time, on any Auction Date or such other time on any Auction Date by which
Broker-Dealers are required to submit Orders to the Trust Company as specified
by the Trust Company from time to time.
"Submitted Bid" and "Submitted Bids" shall have the respective
meanings specified in paragraph C(l) of Section 6 hereof.
"Submitted Hold Order" and "Submitted Hold Orders" shall have
the respective meanings specified in paragraph C(1) of Section 6 hereof.
"Submitted Order" and "Submitted Orders" shall have the
respective meanings specified in paragraph C(1) of Section 6 hereof.
"Submitted Sell Order" and "Submitted Sell Orders" shall have
the respective meanings specified in paragraph C(1) of Section 6 hereof.
B-12
<PAGE> 32
"Subsequent Dividend Period" and "Subsequent Dividend Periods"
shall mean, for each Share of Variable Cumulative Preferred Stock, each Dividend
Period applicable thereto other than the Initial Dividend Period applicable
thereto.
"Sufficient Clearing Bids" shall have the meaning specified in
paragraph C(1)(b) of Section 6 hereof.
"10.84% Preferred Stock" shall mean the 10.84% Cumulative
Preferred Stock, stated value $25 per share (par value $1 per share), of the
Corporation.
"Tender Agent" shall mean, at any time, the bank or the
organization appointed by the Corporation to perform the duties of Tender Agent
as provided in the Remarketing Procedures.
"Term Selection Agent" shall mean at any time the entity
appointed by the Corporation to act on its behalf in establishing Dividend
Periods, redemption prices and redemption dates for a Series of MMP or Converted
SABRES, provided that, if the Corporation shall appoint more than one entity to
so act with respect to a Series, "Term Selection Agent" shall mean, unless the
context otherwise requires, all entities so appointed.
"Trust Company" shall mean a bank or trust company duly
appointed as such.
"Unit" shall mean 100 Shares, or integral multiples thereof,
of a Series of Variable Cumulative Preferred Stock.
"U.S. Treasury Rate" shall mean, on any date, (i) the yield as
calculated by reference to the bid price quotation of the actively traded,
current coupon Treasury security with a maturity most nearly comparable to the
length of the related Dividend Period, as such bid price quotation is published
on the Business Day immediately preceding such date by the Federal Reserve Bank
of New York in its Composite 3:30 P.M. Quotations for U.S. Government Securities
report for such Business Day, or (ii) if such yield as so calculated is not
available, the Alternate Treasury Rate on such date. "Alternate Treasury Rate"
on any date means the yield as calculated by reference to the arithmetic average
of the bid price quotations of the actively traded, current coupon Treasury
security with a maturity most nearly comparable to the length of the related
Dividend Period, as determined by bid price quotations as of any time on the
Business Day immediately preceding such date, obtained by the Trust Company or
the Tender Agent, as the case may be, from at least three recognized primary
U.S. Government securities dealers selected by the Corporation.
"Winning Bid Rate" shall have the meaning specified in
paragraph C(1)(c) of Section 6 hereof.
"6 5/8% Preferred Stock" shall mean the 6 5/8% Cumulative
Preferred Stock, stated value $500 per share (par value $1 per share), of the
Corporation.
B-13
<PAGE> 33
3. Parity. All Shares of all Series of Variable Cumulative
Preferred Stock, and all shares of Other Outstanding Preferred Stock shall rank
equally with respect to payments of dividends and distributions upon
liquidation.
4. Different Shares as Different Series. Each Share of
Variable Cumulative Preferred Stock shall be a separate series of its respective
Series. Each Share shall have identical voting powers, designations, preferences
and relative, participating, optional or other rights, and qualifications,
limitations or restrictions thereof; provided, however, that each Share may have
a different Dividend Period, Dividend Rate, redemption price and redemption date
from each other Share, including without limitation different Dividend Rates,
redemption prices and redemption dates for Shares having Dividend Periods of
equal length which were set on the same day. Shares will be issued in Units
only.
5. Dividends and Dividend Periods.
A. The holders of Shares of Variable Cumulative Preferred
Stock shall be entitled to receive, when, as and if declared by the Board of
Directors of the Corporation, out of funds legally available therefor,
cumulative cash preferential dividends at the Dividend Rates per annum, on the
dates, for the periods and otherwise in the manner provided in this Section 5.
Such preferential dividends shall be declared and paid or set apart for payment
in full for all previous Dividend Periods before the declaration, payment or
setting apart of any funds or assets for payment of any dividends on, or the
making of, or the setting apart of, any funds or assets for any distribution
with respect to, any class of Junior Stock, and before any purchase, redemption
or other acquisition of any class of Junior Stock or the setting apart of any
funds or assets for such purchase, redemption or acquisition. Each Share of
Variable Cumulative Preferred Stock shall rank on a parity with each share of
Other Outstanding Preferred Stock and with each other Share of Variable
Cumulative Preferred Stock, irrespective of Series, with respect to the
preferential dividends at the respective rate fixed for such Share, and no
preferential dividend shall be declared or paid or set apart for payment on any
Shares of Variable Cumulative Preferred Stock of any Series for any current
Dividend Period if dividends on any other Shares of Variable Cumulative
Preferred Stock or Other Outstanding Preferred Stock are accumulated and unpaid
for any prior dividend period or, in case of payment of dividend arrearages on
Variable Cumulative Preferred Stock or Other Outstanding Preferred Stock, unless
at the same time the Corporation shall also declare or pay or set apart for
payment, as the case may be, such amounts with respect to all such dividend
arrearages on all shares of Variable Cumulative Preferred Stock and Other
Outstanding Preferred Stock so that all such shares shall share ratably in such
payment in proportion to the respective amounts of dividends in arrears on all
such shares to the date of payment. For purposes hereof, dividend accumulations
and arrearages do not include any dividends which have not yet become payable or
dividends for any Dividend Payment Date that has not occurred.
B. Dividends on each Share of Variable Cumulative Preferred
Stock shall accumulate from the first day of the Initial Dividend Period and
shall be payable on the last Dividend Payment Date with respect to each Dividend
Period applicable thereto, regardless of its length, and on each additional
Dividend Payment Date, if any, for such Share. Each of (i) the duration of the
Initial Dividend Period with respect to a Series of Variable Cumulative
Preferred Stock, (ii) each additional Dividend Payment Date, if any, during the
Initial Dividend Period
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<PAGE> 34
with respect to a Series of Variable Cumulative Preferred Stock and (iii) the
Dividend Rate for each Share of Variable Cumulative Preferred Stock for the
Initial Dividend Period shall be the period, dates (if any) and rate determined
in accordance with the terms of the share of preferred stock of J.P. Morgan &
Co. Incorporated that was converted into such Share. In no event shall a
dividend be paid with respect to any Dividend Payment Date if a corresponding
equivalent dividend was paid on a share of J.P. Morgan Variable Preferred Stock
that was converted into such Share. Thereafter, the determination of the
duration of each Dividend Period with respect to each Series of Variable
Cumulative Preferred Stock and the Dividend Rate and each Dividend Payment Date
for such Subsequent Dividend Period shall be determined by either the Auction
Method or the Remarketing Method.
Subject to the limitations set forth below, either Dividend
Determination Method may be selected by the Method Selection Agent for a Series
of Variable Cumulative Preferred Stock for any Subsequent Dividend Period with
respect to all the Shares of Variable Cumulative Preferred Stock of such Series
if such Method Selection Agent determines at the time of such selection, based
upon then-current Remarketing Conditions, that the Method so selected will be
the most favorable financing alternative for the Corporation. If more than one
entity is serving as Method Selection Agent for a Series, such entities shall
act in concert in performing their duties, provided that the notices referred to
herein may be given by one entity on behalf of all such entities. The Method
Selection Agent for any Series shall make such selection in a Notice of Method
Selection sent to holders of record of Shares of such Series by such Method
Selection Agent, by first-class mail, postage prepaid, to the address of each
such holder as the same appears on the stock register of the Corporation, not
less than seven Business Days prior to the first day of such Subsequent Dividend
Period. Copies of such Notice of Method Selection shall be delivered physically
or by telecopier or other written electronic communication to the Corporation
and the Trust Company or the Remarketing Agent, as the case may be, at the same
time they are transmitted to the record holders of Shares. Each Notice of Method
Selection will state the Method selected by the Method Selection Agent. If the
Method Selection Agent for a Series which are then SABRES selects the Auction
Method for any Subsequent Dividend Period, the Remarketing Agent for such Series
will establish Dividend Periods and Dividend Rates for Shares of such Series
until the Initial Auction Date in a manner that will best promote an orderly
transition to the Auction Method. Any Dividend Determination Method so selected
by the Method Selection Agent for a Series shall continue in effect for such
Series until the Method Selection Agent selects the other Method in the
aforesaid manner. Until a Method Selection Agent for any Series has been
appointed, the Dividend Determination Method will be the Auction Method.
Any Notice of Method Selection with respect to any Subsequent
Dividend Period for any Series of Variable Cumulative Preferred Stock shall be
deemed to have been withdrawn if on or prior to the second Business Day
preceding the first day of such Subsequent Dividend Period the Corporation shall
have removed the Method Selection Agent for such Series, and in such event the
Corporation shall give a Notice of Removal to record holders of Shares of such
Series by first-class mail, postage prepaid, to the address of each such holder
as the same appears on the stock register of the Corporation. If more than one
entity has been appointed and is acting as Method Selection Agent for that
Series, such Notice of Method Selection shall be deemed to have been withdrawn
only if the Corporation shall have removed all such entities; and the removal at
any time by the Corporation of one or more but not all such entities shall not
effect a
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<PAGE> 35
deemed withdrawal of a Notice of Method Selection and in any such event no
Notice of Removal need be given. Copies of any Notice of Removal shall be
delivered physically or by telecopier or other written electronic communication
to the Trust Company or the applicable Remarketing Agent, as the case may be, at
the same time they are transmitted to the record holders of Shares. If the
Method Selection Agent for any Series resigns or is removed (or, in either case,
if more than one entity has been appointed and is acting as Method Selection
Agent for that Series, then all such entities), the Dividend Determination
Method applicable to such Series in effect at the time of such resignation or
removal will continue in effect until the Corporation appoints a successor
Method Selection Agent for such Series and such Method Selection Agent sends a
Notice of Method Selection. If, as a result of such resignation or removal of
the Method Selection Agent, the Dividend Determination Method for any Series
will continue to be the Auction Method, then the duration of the next succeeding
Dividend Period for such Series will be the Standard Auction Period.
Any Method for a Series of Variable Cumulative Preferred Stock
selected by the Method Selection Agent for such Series pursuant to a Notice of
Method Selection (except a Notice of Method Selection that is deemed to be
withdrawn) shall be conclusive and binding on the Corporation and the holders of
Shares of such Series. If the Notice of Method Selection is not deemed to have
been withdrawn, any Method so selected by the Method Selection Agent for a
Series will continue in effect for that Series until such Method Selection Agent
selects the other Method in the aforesaid manner. No defect in the Notice of
Method Selection or the Notice of Removal of the Method Selection Agent or in
the mailing thereof shall affect the validity of any change in the Dividend
Determination Method or any such withdrawal or removal.
Notwithstanding the foregoing, the Method Selection Agent for
a Series shall not be entitled to change the Dividend Determination Method then
applicable to such Series if (i) at the time of an election that the Remarketing
Method apply to a Series, the Corporation has not appointed (and given notice or
taken such other action as may be necessary for the timely effectiveness of such
appointment) a Remarketing Agent, a Tender Agent and a SABRES Depositary for
such Series, (ii) at the time of an election that the Auction Method apply to a
Series, the Corporation has not appointed (and given notice or taken such other
action as aforesaid) a Trust Company, an Auction Stock Depositary and at least
one Broker-Dealer for such Series, or such election would result in more than
one Dividend Period for the Shares of such Series or (iii) at the time of any
such election, a Payment Failure has occurred and is continuing. Once the Method
Selection Agent for a Series shall have selected a Dividend Determination Method
for such Series for a Subsequent Dividend Period in the aforesaid manner, such
selection shall become effective on the last day of the Dividend Period(s) then
applicable to Shares of such Series notwithstanding any Payment Failure which
may occur after the delivery of the Notice of Method Selection by the Method
Selection Agent, the failure to remarket tendered Shares of SABRES of such
Series, in the case of the selection of the Remarketing Method, or the lack of
Sufficient Clearing Bids in the Auction for such Series, in the case of the
selection of the Auction Method.
C. Each Dividend Period for Shares of Variable Cumulative
Preferred Stock shall have a duration of not more than 30 years and not less
than (i) 7 days in the case of MMP and (ii) 1 Business Day in the case of
SABRES. Each Dividend Period shall end on the day immediately preceding the
first day of a Subsequent Dividend Period.
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<PAGE> 36
D. Each Subsequent Dividend Period for each Series of MMP will
begin on a Dividend Payment Date and, except as otherwise provided herein, the
duration of each Subsequent Dividend Period for each Series of MMP shall be the
Standard Auction Period, provided that, subject to the limitations set forth in
paragraph C of this Section 5, the applicable Term Selection Agent for such
Series may, except during the continuance of a Payment Failure, select the
duration of any Subsequent Dividend Period for Shares of MMP of such Series by
sending a Notice of Term Selection to all holders of record of Shares of MMP or
Converted SABRES of such Series, by first-class mail, postage prepaid, to the
address of each such holder as the same appears on the stock register of the
Corporation, not less than 7 Business Days nor more than 60 days prior to the
first day of such Subsequent Dividend Period. The Term Selection Agent for each
Series of MMP will establish Dividend Periods for such Series (and any
additional Dividend Payment Dates, and redemption dates and redemption prices)
that the Term Selection Agent determines will be the most favorable financing
alternative for the Corporation based upon the then-current Remarketing
Conditions. If more than one entity is serving as Term Selection Agent for a
Series, such entities shall act in concert in performing their duties, provided
that notices referred to herein may be given by one such entity on behalf of all
such entities. Each Notice of Term Selection shall state (i) the length of the
next succeeding Dividend Period, (ii) in the case of any Dividend Period in
excess of 99 days in duration, any Dividend Payment Date or Dates selected by
the Term Selection Agent in addition to the last Dividend Payment Date with
respect to such Dividend Period and (iii) any additional dates on which Shares
of MMP may be redeemed and the corresponding redemption prices (which may not be
less than One Thousand Dollars ($1,000) per Share in the case of Shares having a
Dividend Period in excess of 364 days) determined by such Term Selection Agent.
In the absence of any Notice of Term Selection for a Series of MMP with respect
to a Subsequent Dividend Period, the duration of such period shall be the
Standard Auction Period. The Term Selection Agent for any series of MMP may
withdraw any Notice of Term Selection with respect to such Series, if such Term
Selection Agent determines that because of subsequent changes in the Remarketing
Conditions the duration of the Subsequent Dividend Period specified in such
Notice of Term Selection will not result in the most favorable financing
alternative for the Corporation, by sending a Notice of Withdrawal to all
holders of record of Shares of MMP or Converted SABRES of such Series by
first-class mail, postage prepaid, to the address of each such holder as the
same appears on the stock register of the Corporation, by no later than 3:00
P.M., New York City time, on the third Business Day preceding the first day of
the applicable Subsequent Dividend Period.
Any Notice of Term Selection with respect to any Series of MMP
shall be deemed to have been withdrawn if on or prior to the second Business Day
preceding the first day of the applicable Subsequent Dividend Period for such
Series, the Corporation shall have removed the Term Selection Agent for such
Series, and in such event the Corporation shall give a Notice of Removal to
record holders of Shares of such Series by first-class mail, postage prepaid, to
the address of each such holder as the same appears on the stock register of the
Corporation. If more than one entity has been appointed and is acting as Term
Selection Agent for that Series, such Notice of Term Selection shall be deemed
to have been withdrawn only if the Corporation shall have removed all such
entities; and the removal at any time by the Corporation of one or more but not
all such entities shall not effect a deemed withdrawal of a Notice of Term
Selection and in any such event no Notice of Removal need be given. If the Term
Selection Agent for any Series of MMP sends a Notice of Term Selection with
respect to any Subsequent Dividend
B-17
<PAGE> 37
Period for such Series and delivers a Notice of Withdrawal with respect thereto
or such Notice of Term Selection is deemed to have been withdrawn, the duration
of such Subsequent Dividend Period for such Series will be the Standard Auction
Period. In addition, if there is no Term Selection Agent for any Series of MMP
as a result of the resignation or removal of all entities then serving as such,
then the duration of each Subsequent Dividend Period will be the Standard
Auction Period until the Corporation shall appoint a Term Selection Agent for
such Series and such Term Selection Agent shall send a Notice of Term Selection.
Any Subsequent Dividend Period for a Series of MMP established by the Term
Selection Agent for such Series pursuant to a Notice of Term Selection Agent for
such Series pursuant to a Notice of Term Selection (except a Notice of Term
Selection that is deemed to be withdrawn) and any withdrawal thereof pursuant to
a Notice of Withdrawal shall be conclusive and binding on the Corporation and
the holders of Shares of such Series of MMP.
Copies of any Notice of Term Selection, Notice of Withdrawal
or Notice of Removal shall be delivered physically or by telecopier or other
written electronic communication to the Trust Company and the applicable Method
Selection Agent by the Term Selection Agent or the Corporation, as the case may
be, at the same time they are transmitted to the record holders of Shares of
MMP. The Trust Company will thereupon use its reasonable best efforts to provide
copies of any such notice to each Broker-Dealer for such Series as soon as
practicable after receiving such notice. No defect in any notice or in the
mailing thereof shall affect the validity of any change in the Dividend Period
or any such withdrawal or removal.
Notwithstanding the foregoing, in the event that Sufficient
Clearing Bids have not been made, so that the Dividend Rate for the next
Dividend Period for a Series of MMP is equal to the Maximum Rate, then the
duration of the Subsequent Dividend Period in respect of such Series of MMP
shall be the lesser of (i) the length of such Dividend Period as specified by
the Term Selection Agent in a Notice of Term Selection sent as described above,
or (ii) the Standard Auction Period.
At all times prior to a Payment Failure, all Shares of MMP of
a Series will have a single Dividend Period and will accumulate dividends at a
single Dividend Rate. Except as provided in paragraph G of this Section 5, the
Dividend Rate per annum on the Shares of MMP of a Series for each Subsequent
Dividend Period shall be equal to the rate per annum that the Trust Company
advises the Corporation has resulted from an Auction for such Series. An Auction
for MMP of each Series to determine the Dividend Rate for each Subsequent
Dividend Period for such Series will be held on the Business Day immediately
preceding the first day of each such Subsequent Dividend Period.
E. Each Subsequent Dividend Period for each Series of SABRES
will begin on a Dividend Payment Date, and except as otherwise provided in
paragraphs F and G of this Section 5, the duration of each Subsequent Dividend
Period and the Dividend Rate for each such Subsequent Dividend Period for each
Share of SABRES shall be established by the Remarketing Agent for such Shares
pursuant to the Remarketing Procedures, such determination to be conclusive and
binding on the Corporation and the holder of such Share of SABRES.
F. Notwithstanding the provisions of paragraphs D and E of
this Section 5, the Dividend Rate which results from the application of the
Auction Procedures or the
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<PAGE> 38
Remarketing Procedures for any Subsequent Dividend Period for any Share of
Variable Cumulative Preferred Stock shall not be greater than the Maximum Rate
for such Share (i) on the Auction Date, if such Share is MMP or Converted
SABRES, or (ii) on the day of Remarketing of such Share, if such Share is SABRES
or Converted MMP.
G. Notwithstanding the foregoing provisions of this Section 5,
the application of the Auction Procedures and the Remarketing Procedures shall
be suspended during the continuance of a Payment Failure; and during such
continuance dividends will accumulate on the Shares of Variable Cumulative
Preferred Stock of all Series at Dividend Rates equal to two hundred percent
(200%) of the Applicable Determining Rate for successive Dividend Periods
commencing on and after the date such Payment Failure first occurred, or, in the
case of the Shares of any Series of Variable Cumulative Preferred Stock so
called for redemption, for successive Dividend Periods commencing on and after
such redemption date, the duration of such Dividend Periods to be one Business
Day in the case of Shares of SABRES and the Standard Auction Period in the case
of Shares of MMP. In no event shall the Dividend Rate on any Share of Variable
Cumulative Preferred Stock be adjusted prior to the end of a Dividend Period for
such Share. If no Payment Failure continues to exist at the end of a Dividend
Period, the application of the Auction Procedures and the Remarketing Procedures
shall be resumed.
H. The Corporation shall pay to the Paying Agent not later
than (i) in the case of Dividend Periods of one Business Day, 4:00 P.M., New
York City time, and (ii) in the case of all other Dividend Periods, 12:00 noon,
New York City time, in each case, on the Business Day next preceding each
Dividend Payment Date for Shares of Variable Cumulative Preferred Stock, an
aggregate amount of funds available on the next Business Day in The City of New
York, New York, equal to all dividends to be paid to all holders of Shares of
such Variable Cumulative Preferred Stock on such Dividend Payment Date. All such
moneys shall be held in trust for the payment of such dividends by the Paying
Agent for the benefit of the holders.
I. Each dividend shall be paid to the holders of record at
their respective addresses as the same appear on the stock register of the
Corporation on the Business Day next preceding the Dividend Payment Date
relating to such dividend. Dividends in arrears for any past Dividend Period may
be declared and paid at any time, without reference to any regular Dividend
Payment Date.
J. The amount of dividends per Share accumulated on each Share
of Variable Cumulative Preferred Stock during any Dividend Period of less than
365 days shall be computed by multiplying the Dividend Rate for such Dividend
Period by a fraction, the numerator of which shall be the number of days in such
Dividend Period (calculated by counting the first day thereof and including the
last day thereof) and the denominator of which shall be 360, and multiplying One
Thousand Dollars ($1,000) by the rate so obtained. During any Dividend Period of
365 days or longer, the amount of dividends per Share accumulated on each Share
of Variable Cumulative Preferred Stock shall be computed on the basis of a
360-day year consisting of twelve 30-day months.
K. Each prospective purchaser of Shares of Variable Cumulative
Preferred Stock will be required to sign a Master Purchaser's Letter and deliver
such Master Purchaser's Letter (i) to a Broker-Dealer (who will deliver copies
thereof to the Trust Company) as a
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<PAGE> 39
condition precedent to purchasing MMP or (ii) to the applicable Remarketing
Agent (who will deliver copies thereof to the Tender Agent) as a condition
precedent to purchasing SABRES.
6. Auction Procedures.
A. Orders by Existing Holders and Potential Holders in an
Auction. All Orders must be submitted in Units. On or prior to the Submission
Deadline on each Auction Date:
(1) each Existing Holder may submit to a Broker-Dealer
information as to:
(a) the number of Outstanding Shares of MMP of such
Series, if any, held by such Existing Holder which such
Existing Holder desires to continue to hold for the next
succeeding Dividend Period without regard to the rate
determined by the Auction Procedures for the next succeeding
Dividend Period;
(b) the number of Outstanding Shares of MMP of such
Series, if any, that such Existing Holder desires to sell for
the next succeeding Dividend Period if the rate determined by
the Auction Procedures shall be less than the rate per annum
specified by such Existing Holder; and/or
(c) the number of Outstanding Shares of MMP of such
Series, if any, held by such Existing Holder which such
Existing Holder offers to sell without regard to the rate
determined by the Auction Procedures for the next succeeding
Dividend Period; and
(2) one or more Broker-Dealers shall in good faith, for the
purpose of conducting a competitive Auction in a commercially
reasonable manner, contact Potential Holders, including Persons that
are not Existing Holders, by telephone or otherwise to determine the
number of Shares of MMP of such Series, if any, which each such
Potential Holder offers to purchase, provided that the rate determined
by the Auction Procedures for the next succeeding Dividend Period shall
not be less than the rate per annum specified by such Potential Holder.
For the purposes hereof, the communication to a Broker-Dealer of
information referred to in paragraph A(1)(a), A(1)(b), or A(1)(c) or
A(2) of this Section 6 is hereinafter referred to as an "Order" and
collectively as "Orders" and each Existing Holder and each Potential
Holder placing an Order is hereinafter referred to as a "Bidder" and
collectively as "Bidders"; an Order containing the information referred
to in paragraph A(l)(a) of this Section 6 is hereinafter referred to as
a "Hold Order" and collectively as "Hold Orders"; an Order containing
the information referred to in paragraph A(1)(b) or A(2) of this
Section 6 is hereinafter referred to as a "Bid" and collectively as
"Bids"; and an Order containing the information referred to in
paragraph A(l)(c) of this Section 6 is hereinafter referred to as a
"Sell Order" and collectively as "Sell Orders."
(3) a Bid by an Existing Holder shall constitute an
irrevocable offer to sell:
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<PAGE> 40
(a) the number of Outstanding Shares of MMP of such
Series specified in such Bid if the rate determined by the
Auction Procedures on such Auction Date shall be less than the
rate specified therein; or
(b) such number or a lesser number of Outstanding
Shares of MMP of such Series to be determined as set forth in
paragraph D(1)(d) of this Section 6 if the rate determined by
the Auction Procedures on such Auction Date shall be equal to
the rate specified therein; or
(c) a lesser number of Outstanding Shares of MMP of
such Series to be determined as set forth in paragraph D(2)(c)
of this Section 6 if the rate specified therein shall be
higher than the Maximum Rate and Sufficient Clearing Bids do
not exist.
(4) a Sell Order by an Existing Holder shall constitute an
irrevocable offer to sell:
(a) the number of Outstanding Shares of MMP of such
Series specified in such Sell Order, or
(b) such number or a lesser number of Outstanding
Shares of MMP of such Series as set forth in paragraph D(2)(c)
of this Section 6 if Sufficient Clearing Bids do not exist.
(5) a Bid by a Potential Holder shall constitute an
irrevocable offer to purchase:
(a) the number of Outstanding Shares of MMP of such
Series specified in such Bid if the rate determined by the
Auction Procedures on such Auction Date shall be higher than
the rate specified therein; or
(b) the number or a lesser number of Outstanding
Shares of MMP of such Series as set forth in paragraph D(1)(e)
of this Section 6 if the rate determined by the Auction
Procedures on such Auction Date shall be equal to the rate
specified therein.
B. Submission of Orders by Broker-Dealers to Trust Company.
(1) Each Broker-Dealer shall submit in writing to the Trust
Company prior to the Submission Deadline on each Auction Date for a
Series of MMP all Orders obtained by such Broker-Dealer and specify
with respect to each Order:
(a) the name of the Bidder placing such Order;
(b) the aggregate number of Shares of MMP of such
Series that are the subject of such Order;
(c) to the extent that such Bidder is an Existing
Holder:
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<PAGE> 41
(i) the number of Shares of MMP of such Series, if
any, subject to any Hold Order;
(ii) the number of Shares of MMP of such Series, if
any, subject to any Bid and the rate specified
in such Bid; and
(iii) the number of Shares of MMP of such Series, if
any, subject to any Sell Order; and
(d) to the extent such Bidder is a Potential Holder,
the rate specified in such Potential Holder's Bid.
(2) If any rate specified in any Bid contains more than three
figures to the right of the decimal point, the Trust Company shall
round such rate up to the next highest one thousandth (.001) of 1%.
(3) If an Order or Orders covering all of the Outstanding
Shares of MMP of such Series held by any Existing Holder is or are not
submitted for any reason to the Trust Company prior to the Submission
Deadline, the Trust Company shall deem a Hold Order to have been
submitted on behalf of such Existing Holder covering the number of
Outstanding Shares of MMP of such Series held by such Existing Holder
and not subject to Orders submitted to the Trust Company, except that
(i) a Sell Order will be deemed to have been submitted on behalf of an
Existing Holder if an Order is not submitted on behalf of such Existing
Holder in the case of an Auction for a Dividend Period of 365 days or
more and (ii) a Sell Order will be deemed to have been submitted on
behalf of a holder of Converted SABRES if an Order is not submitted on
behalf of such holder.
(4) If one or more Orders covering in the aggregate more than
the number of Outstanding Shares of MMP of such Series held by any
Existing Holder are submitted to the Trust Company, such Orders shall
be considered valid as follows and in the following order of priority:
(a) all Hold Orders shall be considered valid, but
only up to and including in the aggregate the number of Shares
of MMP of such Series held by such Existing Holder, and, if
the number of Shares of MMP of such Series subject to such
Hold Orders exceeds the number of Shares of MMP of such Series
held by such Existing Holder, the number of Shares of MMP of
such Series subject to each such Hold Order shall be reduced
pro rata to cover the number of Shares of MMP of such Series
held by such Existing Holder:
(b) (i) any Bid shall be considered valid up to and
including the excess of the number of Outstanding Shares of
MMP of such Series held by such Existing Holder over the
number of Shares of MMP of such Series subject to any Hold
Order referred to in paragraph B(4)(a) above,
(ii) subject to paragraph B(4)(b)(i) above, if
more than one Bid with the same rate is
submitted on behalf of such Existing Holder
and the number of Shares of MMP of such
Series
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<PAGE> 42
subject to such Bids is greater than such
excess then such Bids shall be considered
valid up to the amount of such excess, and
the number of Shares of MMP of such Series
subject to each Bid with the same rate shall
be reduced pro rata to cover the number of
Shares of MMP of such Series equal to such
excess, and
(iii) subject to paragraphs B(4)(b)(i) and (ii)
above, if more than one Bid with different
rates is submitted on behalf of such
Existing Holder, such Bids shall be
considered valid in the ascending order of
their respective rates up to the amount of
such excess, and
(iv) in any such event the number, if any, of
such Shares of MMP of such Series subject to
Bids not valid under this paragraph B(4)(b)
shall be treated as the subject of a Bid by
a Potential Holder; and
(c) all Sell Orders shall be considered valid but
only up to and including in the aggregate the excess of the
number of Outstanding Shares of MMP of such Series held by
such Existing Holder over the sum of the Shares of MMP of such
Series subject to Hold Orders referred to in paragraph B(4)(a)
and valid Bids by Existing Holders referred to in paragraph
B(4)(b) above.
(5) If more than one Bid is submitted on behalf of any
Potential Holder, each Bid submitted shall be a separate Bid with the
rate therein specified.
C. Determination of Sufficient Clearing Bids, Winning Bid Rate
and Dividend Rate.
(1) Not earlier than the Submission Deadline on each Auction
Date for a Series of MMP, the Trust Company shall assemble all Orders
submitted or deemed submitted to it by Broker-Dealers (each such Order
as submitted or deemed submitted by a Broker-Dealer being hereinafter
referred to individually as a "Submitted Hold Order," a "Submitted Bid"
or a "Submitted Sell Order," as the case may be, or as a "Submitted
Order" and collectively as "Submitted Hold Orders," "Submitted Bids" or
"Submitted Sell Orders," as the case may be, or as "Submitted Orders")
and shall determine:
(a) the excess of the total number of Outstanding
Shares of MMP of such Series over the number of Outstanding
Shares of MMP of such Series that are the subject of Submitted
Hold Orders (such excess being hereinafter referred to as the
"Available Shares");
(b) From the Submitted Orders whether the number of
Outstanding Shares of MMP of such Series that are the subject
of Submitted Bids by Potential Holders specifying one or more
rates equal to or lower than the Maximum Rate exceeds or is
equal to the sum of:
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<PAGE> 43
(i) the number of Outstanding Shares of MMP of
such Series that are the subject of
Submitted Bids by Existing Holders
specifying one or more rates higher than the
Maximum Rate, and
(ii) the number of Outstanding Shares of MMP of
such Series that are subject to Submitted
Sell Orders (in the event of such excess or
such equality, other than because the number
of Shares of MMP of such Series in
paragraphs C(1)(b)(i) and C(1)(b)(ii) above
is zero because all of the Outstanding
Shares of MMP of such Series are the subject
of Submitted Hold Orders, such Submitted
Bids in this paragraph (b) being hereinafter
referred to collectively as "Sufficient
Clearing Bids"), and
(c) if Sufficient Clearing Bids exist, the lowest
rate specified in the Submitted Bids (the "Winning Bid Rate")
which if:
(i) (A) each Submitted Bid from Existing Holders
specifying such lowest rate and (B) all
other Submitted Bids from Existing Holders
specifying lower rates were rejected, thus
entitling such Existing Holders to continue
to hold the Shares of MMP of such Series
that are the subject of such Submitted Bids,
and
(ii) (A) each Submitted Bid from Potential
Holders specifying such lowest rate and (B)
all other Submitted Bids from Potential
Holders specifying lower rates were
accepted, thus entitling the Potential
Holders to purchase the Shares of MMP of
such Series that are the subject of those
Submitted Bids, would result in such
Existing Holders described in paragraph
C(1)(c)(i) above continuing to hold an
aggregate number of Outstanding Shares of
MMP of such Series which, when added to the
number of Outstanding Shares of MMP of such
Series to be purchased by such Potential
Holders described in paragraph C(1)(c)(ii)
above would equal not less than the
Available Shares.
(2) Promptly after the Trust Company has made the
determinations pursuant to paragraph C(1) above, the Trust Company
shall advise the Corporation of the Applicable Determining Rate and the
Maximum Rate and, based on such determinations, the Dividend Rate for
the next succeeding Dividend Period as follows:
(a) if Sufficient Clearing Bids exist, that the
Dividend Rate for the next succeeding Dividend Period shall be
equal to the Winning Bid Rate so determined;
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<PAGE> 44
(b) if Sufficient Clearing Bids do not exist (other
than because all of the Outstanding Shares of MMP of such
Series of a Series are the subject of Submitted Hold Orders),
that the Dividend Rate for the next succeeding Dividend Period
shall be the Maximum Rate; or
(c) if all of the Outstanding Shares of MMP of such
Series are the subject of Submitted Hold Orders, the Dividend
Rate for the next succeeding Dividend Period shall be equal to
fifty-eight per cent (58%) of the Applicable Determining Rate.
D. Acceptance and Rejection of Submitted Bids and Submitted
Sell Orders and Allocation of Shares in an Auction. Based on the determinations
made pursuant to paragraph C(l) above, the Submitted Bids and the Submitted Sell
Orders shall be accepted or rejected and the Trust Company shall take such other
action as set forth below:
(1) If Sufficient Clearing Bids have been made, Submitted Bids
and Submitted Sell Orders shall be accepted or rejected as follows in
the following order of priority and all other Submitted Bids shall be
rejected, subject to the Rounding Procedures:
(a) the Submitted Sell Orders of Existing Holders
shall be accepted and the Submitted Bids of each of the
Existing Holders specifying any rate that is higher than the
Winning Bid Rate shall be accepted, thus requiring each such
Existing Holder to sell the Shares of MMP of such Series that
are the subject of such Submitted Bids;
(b) the Submitted Bids of each of the Existing
Holders specifying any rate that is lower than the Winning Bid
Rate shall be rejected, thus requiring each such Existing
Holder to continue to hold the Shares of MMP of such Series
that are the subject of such Submitted Bids;
(c) the Submitted Bids of each of the Potential
Holders specifying any rate that is lower than the Winning Bid
Rate shall be accepted;
(d) the Submitted Bids of each of the Existing
Holders specifying a rate that is equal to the Winning Bid
Rate shall be rejected, thus requiring each such Existing
Holder to continue to hold the Shares of MMP of such Series
that are the subject of such Submitted Bids, unless the number
of Outstanding Shares of MMP of such Series subject to all
such Submitted Bids shall be greater than the number of Shares
("Remaining Shares") equal to the excess of the Available
Shares over the number of Shares of MMP of such Series subject
to Submitted Bids described in paragraphs D(1)(b) and D(1)(c)
above, in which event the Submitted Bids of each such Existing
Holder shall be rejected in part, and each such Existing
Holder shall be required to continue to hold Shares of MMP of
such Series, but only in an amount equal to the difference
between (A) the number of Outstanding Shares of MMP of such
Series then held by such Existing Holder subject to such
Submitted Bids and (B) the number of Shares of MMP of such
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<PAGE> 45
Series obtained by multiplying the number of Remaining Shares
by a fraction, the numerator of which shall be the number of
Outstanding Shares of MMP of such Series held by such Existing
Holder subject to such Submitted Bids, and the denominator of
which shall be the sum of the number of Outstanding Shares of
MMP of such Series subject to such Submitted Bids made by all
such Existing Holders that specified a rate equal to the
Winning Bid Rate; and
(e) the Submitted Bids of each of the Potential
Holders specifying a rate that is equal to the Winning Bid
Rate shall be accepted but only in an amount equal to the
number of Shares of MMP of such Series obtained by multiplying
the difference between the Available Shares and the number of
Shares of MMP of such Series subject to Submitted Bids
described in paragraphs D(1)(b), D(1)(c) and D(1)(d) above by
a fraction, the numerator of which shall be the number of
Outstanding Shares of MMP of such Series subject to such
Submitted Bids, and the denominator of which shall be the sum
of the number of Outstanding Shares of MMP of such Series
subject to such Submitted Bids made by all such Potential
Holders that specified a rate equal to the Winning Bid Rate.
(2) If Sufficient Clearing Bids have not been made (other than
because all of the Outstanding Shares of MMP of such Series are subject
to Submitted Hold Orders), Submitted Orders shall be accepted or
rejected as follows in the following order of priority and all other
Submitted Bids shall be rejected, subject to the Rounding Procedures:
(a) the Submitted Bids of each Existing Holder
specifying any rate that is equal to or lower than the Maximum
Rate shall be rejected, thus requiring such Existing Holder to
continue to hold the Shares of MMP of such Series that are the
subject of such Submitted Bids;
(b) the Submitted Bids if each Potential Holder
specifying any rate that is equal to or lower than the Maximum
Rate shall be accepted; and
(c) the Submitted Bids of each Existing Holder
specifying any rate that is higher than the Maximum Rate shall
be accepted and the Submitted Sell Orders of each Existing
Holder shall be accepted, thus entitling each Existing Holder
that submitted any such Submitted Bid or Submitted Sell Order
to sell the Shares of MMP of such Series subject to Submitted
Bid or Submitted Sell Order, but, in both cases only in an
amount equal to the difference between (A) the number of
Outstanding Shares of MMP of such Series then held by such
Existing Holder subject to such Submitted Bids or Submitted
Sell Orders and (B) the number of Shares of MMP of such Series
obtained by multiplying the difference between the Available
Shares and the aggregate number of Shares of MMP of such
Series subject to Submitted Bids described in paragraphs
D(2)(a) and D(2)(b) above by a fraction, the numerator of
which shall be the number of Outstanding Shares of MMP of such
Series held by such Existing Holder subject to such Submitted
Bids or Submitted Sell Orders, and the denominator of which
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<PAGE> 46
shall be the number of Outstanding Shares of MMP of such
Series subject to all such Submitted Bids and Submitted Sell
Orders.
7. Remarketing Procedures.
A. Determination of Dividend Periods and Rates for Remarketed
Stock. Subject to paragraphs F and G of Section 5 hereof, the duration of each
Subsequent Dividend Period, and the Dividend Rate for each Subsequent Dividend
Period, will be established by the Remarketing Agent for each Share of SABRES
and will be conclusive and binding on the Corporation and the holder of such
Share of SABRES. Each Remarketing Agent will establish Dividend Rates (which
shall not exceed the Maximum Rate) for each Dividend Period for such Share of
SABRES which it shall determine will be the lowest rate at which tendered Shares
of SABRES would be remarketed at One Thousand Dollars ($1,000) per Share. In
establishing each Dividend Period and Dividend Rate, each Remarketing Agent will
select Dividend Periods and Dividend Rates which it shall determine will result
in the most favorable financing alternative for the Corporation based on the
then-current Remarketing Conditions. The Shares of SABRES will be remarketed and
traded only in Units. All the Shares of SABRES in a Unit will have the same
Dividend Rate and Dividend Period.
B. Remarketing; Tender for Remarketing. The following
procedures shall be applicable to each Remarketed Share:
(1) The Remarketing Agent. The Corporation shall take all
reasonable action necessary so that, at all times when a Series of
SABRES or Converted MMP is outstanding, one or more investment banks,
brokers, dealers or other organizations qualified to remarket Shares of
SABRES and to establish Dividend Periods and Dividend Rates as herein
provided shall act as Remarketing Agent for each Share of SABRES of
such Series. Each Remarketing Agent shall use its best efforts to
remarket all Shares of SABRES, on behalf of the holders thereof,
tendered for sale by Remarketing for which it is acting as Remarketing
Agent without charge to such holder, only at $1,000 per Share, provided
that no such Remarketing Agent shall be obligated to remarket such
Shares if there shall be a material misstatement or omission in any
disclosure document provided by the Corporation and used in connection
with the Remarketing of such Share or at any time such Remarketing
Agent shall have determined that it is not advisable to remarket such
Share by reason of: (i) a material adverse change in the financial
condition of the Corporation, (ii) a banking moratorium, (iii) domestic
or international hostilities, (iv) an amendment of the provisions
hereof which materially and adversely changes the nature of the Shares
of SABRES or the Remarketing Procedures or (v) a Payment Failure. Any
Remarketing Agent may purchase tendered Shares for its own account.
Should the Remarketing Agent for any Share of SABRES not succeed in
Remarketing all such Shares of SABRES so tendered for Remarketing on
any date, such Remarketing Agent shall select the Shares of such SABRES
to be sold from those tendered pro rata or in such other manner as it
shall deem appropriate so that each owner shall beneficially own Shares
of SABRES of a Series only in Units. Payments for Shares of SABRES
remarketed shall be made by the Tender Agent by crediting such payments
to the accounts of the holders thereof maintained by the Tender Agent
or, to the extent duly requested by holders, by wire or other transfer
in immediately available funds to their
B-27
<PAGE> 47
accounts with commercial banks in the United States, but, in either
case, only upon surrender to the Tender Agent of the certificates
representing such Shares of SABRES, properly endorsed for transfer. If
for any reason a Share of SABRES tendered for Remarketing is not
remarketed in the applicable Remarketing, such Share will be retained
by its holder. Until remarketed each such Share of SABRES will have
successive Dividend Periods of one Business Day and will be entitled to
dividends, payable daily, at the Maximum Rate.
(2) Notice of Shares To Be Retained. Each Share of SABRES or
Converted MMP shall be deemed to have been tendered to the Tender Agent
for sale by Remarketing on the Business Day immediately preceding the
first day of each Subsequent Dividend Period applicable thereto, unless
the holder thereof shall have given irrevocable notice otherwise to the
Remarketing Agent for such Share of SABRES or Converted MMP or, if so
instructed by such Remarketing Agent, to the Tender Agent. Such notice,
which may be telephonic or written, must be delivered to such agent
prior to 3:00 P.M., New York City time, on such Business Day or on such
earlier day specified in a notice, if any, mailed by the Tender Agent
at the direction of such Remarketing Agent to such record holder at its
address as the same appears on the stock register of the Corporation,
which day shall be a Business Day at least four Business Days after the
mailing of such notice. The notice from such holder of an election to
retain Shares of SABRES shall state (i) the number of the certificate
representing the Shares of SABRES not to be deemed to have been so
tendered, unless such certificate is held by the SABRES Depositary,
(ii) the number of Shares of SABRES represented by such certificate or,
in the case of Shares of SABRES held by the SABRES Depositary, the
number of Shares so held, and (iii) the number of such Shares of SABRES
which shall be deemed not to have been so tendered. An owner may tender
Shares of SABRES or Converted MMP of a Series only in Units.
(3) Shares Deemed To Have Been Tendered. The failure to give
notice with respect to any Share of SABRES or Converted MMP as provided
in paragraph B(2) above shall constitute the irrevocable tender for
Remarketing of such Share. Certificates representing Shares so tendered
and remarketed shall be issued to the purchasers thereof or to the
SABRES Depositary, irrespective of whether the certificates formerly
representing such Shares shall have been delivered to the Tender Agent.
A holder which has not given notice that it will retain Shares of
SABRES or Converted MMP shall have no further rights with respect to
such Shares upon the Remarketing of such Shares, except the right to
receive any previously declared but unpaid dividends thereon and the
proceeds of the Remarketing of such Shares (but only upon surrender of
the certificates representing such Shares to the Tender Agent properly
endorsed for transfer, in the case of a holder which has taken physical
delivery of a Share certificate). At any time, any or all Units of
SABRES of a Series may have Dividend Periods of various lengths.
Depending on Remarketing Conditions at the time of Remarketing, any or
all Units of SABRES of a Series may have different Dividend Rates,
including those set on the same day for Dividend Periods of equal
length.
(4) Funds for Purchase of Shares. Shares of SABRES tendered
for Remarketing as provided in this Section 7 shall be purchased, and
payments to the
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<PAGE> 48
holders for Shares of SABRES remarketed will be made, solely from the
proceeds received from the purchasers of such Shares in a Remarketing.
Neither the Corporation, the Tender Agent nor any Remarketing Agent
shall be obligated to provide funds to make payment to the holders of
Shares so tendered.
C. The Remarketing Process. The Remarketing process will be
conducted on the following schedule and in the following manner (all times are
New York City Time):
The Business Day Immediately Preceding the First Day of each
Subsequent Dividend Period (or such other time and day as may have been
specified in a notice mailed to the holders of Shares of SABRES or Converted
MMP):
Beginning Not Later Than 1:00 P.M. The Remarketing Agent for
the Shares then being remarketed will determine and, upon request, make
available to all interested persons non-binding indications of Dividend Periods
and Dividend Rates based upon then-current Remarketing Conditions. Each holder
may obtain a binding commitment as to the specific Dividend Period or Dividend
Periods and the related Dividend Rate or Dividend Rates which will be applicable
to such holder's Shares.
At 3:00 P.M. Holders of Shares of SABRES and Converted MMP
will be deemed to have tendered Shares for sale by Remarketing at $1,000 per
Share and only in Units unless they have given contrary instructions to the
Remarketing Agent for such Shares or, if so instructed by such Remarketing
Agent, to the Tender Agent.
After 3:00 P.M. The applicable Remarketing Agent will solicit
and receive orders from prospective investors to purchase tendered Shares of
SABRES. A purchaser, at the time of its agreement to purchase Shares of SABRES,
may obtain a binding commitment as to the specific Dividend Period or Dividend
Periods and the related Dividend Rate or Dividend Rates for such Shares of
SABRES based upon then-current Remarketing Conditions.
The First Day of such Subsequent Dividend Period (always a
Business Day):
Opening of Business. The applicable Remarketing Agent will
continue, if necessary, Remarketing Shares of SABRES.
By 1:00 P.M. The applicable Remarketing Agent will have
completed Remarketing and will advise the Tender Agent as to the Dividend Rate
and Dividend Period applicable to each Share of SABRES commencing a Dividend
Period on that day and of any failure to remarket.
By 2:30 P.M. New holders must deliver the purchase price as
instructed by the applicable Remarketing Agent. Former holders will be paid the
proceeds of the Remarketing of their Shares by the Tender Agent (upon surrender
of their certificates, if applicable).
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<PAGE> 49
8. Miscellaneous.
A. The Board of Directors may interpret the provisions hereof
to resolve any inconsistency or ambiguity which may arise or be revealed in
connection with the Auction Procedures or the Remarketing Procedures provided
for herein.
B. So long as the Dividend Rate is based on the results of an
Auction, an Existing Holder (i) may sell, transfer or otherwise dispose of
Shares of MMP of such Series only pursuant to a Bid or Sell Order in accordance
with the Auction Procedures or to or through a Broker-Dealer or to a Person that
shall have delivered, or has caused to be delivered, a signed copy of a Master
Purchaser's Letter to the Trust Company, provided that in the case of all
transfers other than pursuant to Auctions, such Existing Holder, its Agent
Member or its Broker-Dealer advises the Trust Company of such transfer, and (ii)
shall have the ownership of the Shares of Variable Cumulative Preferred Stock of
the Series held by it maintained in book entry form by the Auction Stock
Depositary in the account of its Agent Member, which in turn will maintain
records of such Existing Holder's beneficial ownership. Any transfer of Shares
of MMP in violation of the terms of a Master Purchaser's Letter may affect the
right of the Person acquiring such Shares to participate in Auctions.
C. Each Remarketing Agent will be required to register on a
list maintained pursuant to a Remarketing Agreement a transfer of Shares of
SABRES for which it is the Remarketing Agent from a holder to another person
only if such transfer is made to a person that has delivered a signed Master
Purchaser's Letter to such Remarketing Agent and if (i) such transfer is
pursuant to a Remarketing or (ii) such Remarketing Agent has been notified in
writing (A) by such holder of such transfer or (B) by any person that purchased
or sold such Shares in a Remarketing of the failure of such Shares to be
delivered or paid for, as the case may be, in connection with such Remarketing.
A Remarketing Agent is not required to register a transfer of Shares of SABRES
pursuant to clause (ii) above on or prior to the Business Day immediately
preceding the first day of a Subsequent Dividend Period for such Shares unless
it receives the written notice required by such clause (ii) by 3:00 P.M., New
York City time, on the second Business Day preceding the first day of such
Subsequent Dividend Period. Such Remarketing Agent will rescind a transfer
registered on such list as a result of a Remarketing if the Remarketing Agent is
notified in writing of the failure of Shares to be delivered or paid for as
required. Any transfer of Shares of SABRES made in violation of the terms of a
Master Purchaser's Letter may affect the right of the Person acquiring such
Shares to participate in Remarketings.
D. The Corporation or any Affiliate of the Corporation may
acquire, hold or dispose of Shares of SABRES. As at the date of this Certificate
of Designations, the Corporation anticipates, subject to such limitations as it
and the Remarketing Agent may agree, that it and its Affiliates will purchase
Shares of SABRES during Remarketings only after 3:00 P.M. on the Business Day
immediately preceding the first day of each Subsequent Dividend Period and only
at Dividend Rates and for Dividend Periods established by the Remarketing Agents
without regard to such offers by the Corporation or its Affiliates and will
tender Shares of SABRES for Remarketing only upon at least ten days' prior
notice to the Remarketing Agents. In the event that the Corporation or its
Affiliates purchase Shares of SABRES for their respective accounts, all Shares
of the same Series of SABRES tendered by other owners, including any such Shares
B-30
<PAGE> 50
of SABRES owned by a Remarketing Agent, will be remarketed before the
Remarketing of any such Shares of SABRES of such Series owned by the Corporation
or its Affiliates. If any Shares of SABRES tendered for Remarketing are not
sold, any Shares of SABRES of the same Series tendered for Remarketing by the
Corporation or an Affiliate of the Corporation, up to the number of such Shares
not so sold, will be deemed not to have been so tendered. If the Method of
determining the Dividend Rate for some or all of the Series of SABRES were to be
changed from the Remarketing Method to the Auction Method, the Corporation or
any Affiliate of the Corporation may submit Sell Orders in an Auction with
respect to the Converted SABRES created thereby.
Neither the Corporation nor any Affiliate thereof may submit
an Order in an Auction, except a Sell Order and, in the case of an Affiliate
which is then acting as a Broker-Dealer, Orders on behalf of Existing Holders or
Potential Holders not for its own account.
E. The Trust Company shall reject any Submitted Order of the
Corporation or an Affiliate, except for Sell Orders and Orders of affiliated
Broker-Dealers permitted under paragraph D of this Section 8.
F. If (i) a Payment Failure shall have occurred or (ii) the
Auction Stock Depositary shall resign and the Corporation shall not have
selected a substitute Auction Stock Depositary reasonably acceptable to the
Trust Company prior to such resignation, Shares of MMP of each Series may be
registered for transfer or exchange and new certificates issued upon surrender
of the older certificates in form deemed by the Trust Company properly endorsed
for transfer with all necessary endorsers' signatures guaranteed in such manner
and form as the Trust Company may require by a guarantor reasonably believed by
the Trust Company to be responsible, accompanied by such assurances as the Trust
Company shall deem necessary or appropriate to evidence the genuineness and
effectiveness of each necessary endorsement and satisfactory evidence of
compliance with all applicable law relating to the collection of taxes or funds
necessary for the payment of such taxes.
G. The Corporation or any Affiliate of the Corporation may
acquire Shares of MMP from Existing Holders other than through an Auction,
provided that any Shares so acquired are cancelled and returned to the status of
authorized but undesignated shares of preferred stock.
H. Upon the selection of a Dividend Determination Method for a
Series of Variable Cumulative Preferred Stock for any Subsequent Dividend Period
other than the Dividend Determination Method then applicable to such Series, the
holders of record of the Shares of such Series shall transfer the certificates
for such Shares to the Auction Stock Depositary, in the case of the selection of
the Auction Method, or the SABRES Depositary, in the case of the selection of
the Remarketing Method, in either case on the first day of such Subsequent
Dividend Period. In the event a holder fails to so transfer its certificates as
aforesaid, such certificates shall be deemed cancelled and the Corporation shall
issue a new certificate to the Auction Stock Depositary or the SABRES
Depositary, as the case may be.
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<PAGE> 51
I. The purchase price of each Share of Variable Cumulative
Preferred Stock which is sold either through the Auction Procedures or the
Remarketing Procedures shall be One Thousand Dollars ($l,000).
J. All certificates representing Shares shall be issued in
Share amounts equivalent to Units.
K. An Auction will be held in respect of each Series of
Converted SABRES on the Initial Auction Date. If a holder of Converted SABRES
does not submit an Order in such Auction, such holder will be deemed to have
submitted a Sell Order in such Auction.
L. If a holder of Shares of Converted MMP fails to give
irrevocable notice otherwise to the Remarketing Agent for such Shares (or, if so
instructed by such Remarketing Agent, to the Tender Agent) by no later than 3:00
P.M., New York City time, on the Business Day immediately preceding the first
day of the Subsequent Dividend Period applicable thereto, or such other day as
is specified in a notice delivered in the manner set forth in paragraph (B)(2)
of Section 7, such holder will be deemed to have tendered such Shares for sale
by Remarketing on such Business Day.
M. At all times when Shares of a Series of MMP or Converted
SABRES are Outstanding, the Corporation will use its best efforts to maintain a
Broker-Dealer and Trust Company for such Shares. At all times when Shares of a
Series of SABRES or Converted MMP are outstanding, the Corporation will use its
best efforts to maintain a Remarketing Agent for such Shares.
9. Redemption.
A. The Shares of Variable Cumulative Preferred Stock of each
Series shall be subject to redemption in Units, as a whole or from time to time
in part at the option of the Corporation out of funds legally available therefor
on one of the following dates (each such date is hereinafter referred to herein
as a "redemption date") (i) on the last Dividend Payment Date with respect to
any Dividend Period and at any time when the Dividend Rate applicable to such
Shares is the Maximum Rate at a redemption price of One Thousand Dollars
($1,000) per Share, plus an amount equal to accumulated and unpaid dividends
thereon to, but excluding, the date fixed for redemption and (ii) on such
redemption dates and at redemption prices (which may not be less than $1,000 per
Share in the case of Shares having a Dividend Period in excess of 364 days)
established by the applicable Term Selection Agent in the case of MMP, or by the
applicable Remarketing Agent in the case of SABRES, prior to the commencement of
such Dividend Period, plus an amount equal to accumulated and unpaid dividends
thereon to, but excluding, the date set for redemption. The applicable Term
Selection Agent or the applicable Remarketing Agent, as the case may be, will
establish dates on which Shares may be redeemed and the corresponding redemption
prices of such Shares on such dates that the applicable Term Selection Agent or
the applicable Remarketing Agent, as the case may be, determines based on the
then-current Remarketing Conditions will be the most favorable financing
alternative for the Corporation. Notice of redemption will be provided to record
holders of Shares of Variable Cumulative Preferred Stock to be redeemed not less
than 30 nor more than 60 days prior to the date fixed for redemption by mail,
first-class, postage prepaid, such notice to be addressed to the
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<PAGE> 52
record holder at the address for such holder as the same appears on the stock
register of the Corporation. Such notice shall specify the record date for
determining holders of Shares to be redeemed.
B. Notwithstanding the foregoing, if any dividends on Shares
of Variable Cumulative Preferred Stock are in arrears, no Shares of Variable
Cumulative Preferred Stock shall be redeemed unless all Outstanding Shares of
Variable Cumulative Preferred Stock are simultaneously redeemed, and the
Corporation shall not purchase or otherwise acquire any Shares of Variable
Cumulative Preferred Stock, provided, that the foregoing shall not prevent the
purchase or acquisition of Shares of Variable Cumulative Preferred Stock
pursuant to a purchase or exchange offer made on the same terms to holders of
all Outstanding Shares of Variable Cumulative Preferred Stock. None of the
foregoing shall preclude the Corporation from acquiring Shares of Variable
Cumulative Preferred Stock, constituting either all or a part of a Series, in a
tender or an exchange offer.
C. Each holder of Shares of Variable Cumulative Preferred
Stock called for redemption shall surrender the certificate or certificates, if
any, evidencing such Shares to the Corporation at the place designated in the
notice of redemption for such Shares (properly endorsed or assigned for
transfer, if the notice shall so state) and shall thereupon be entitled to
receive payment of the redemption price plus an amount equal to accumulated and
unpaid dividends to, but excluding, the redemption date therefor.
D. If fewer than all of the Outstanding Shares of Variable
Cumulative Preferred Stock of any Series are to be redeemed as set forth above,
the number of Shares to be redeemed shall be determined by the Board of
Directors. In the case of Shares of MMP, the Shares of such Series shall be
redeemed pro rata from the holders of record of such Shares in proportion to the
number of such Shares held by such holders with adjustments for fractional
shares and so as to ensure that the Shares remaining Outstanding after such
redemption are held of record in Units. In the case of SABRES, the Shares of
such Series shall be redeemed pro rata from the holders of record of the Shares
of such Series having the same Dividend Period and redemption terms, with
adjustments for fractional shares and so as to ensure that the Shares remaining
Outstanding after such redemption are held of record in Units.
E. If notice of redemption shall have been given, then,
notwithstanding that any certificate for Shares so called for redemption shall
not have been surrendered for cancellation, from and after the date fixed for
redemption (unless a Payment Failure shall have occurred), the Shares
represented thereby shall no longer be deemed Outstanding, dividends thereon
shall cease to accumulate and all rights of the holders thereon with respect to
the Shares so called for redemption shall forthwith on such redemption date
cease and terminate, except only the right of the holders thereof to receive the
amount payable upon redemption thereof, without interest. After the date
designated for redemption, and if the redemption price has been paid or set
aside for payment, such Shares of Variable Cumulative Preferred Stock shall not
be transferable on the stock register of the Corporation. Upon surrender in
accordance with the notice of redemption of the certificate or certificates for
the Shares so redeemed (properly endorsed or assigned for transfer, if such
notice shall so state), the redemption price set forth above will be paid by the
Paying Agent.
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<PAGE> 53
F. Any notice which is mailed in the manner herein provided
shall be conclusively presumed to have been duly given whether or not the record
holder receives the notice. In any case, failure duly to give such notice to the
holder of any Shares of any Series of Variable Cumulative Preferred Stock
designated for redemption, in whole or in part, or any defect in such notice
shall not affect the validity of the proceedings for the redemption of any other
Shares of a Series.
G. Shares of Variable Cumulative Preferred Stock which have
been redeemed will be cancelled and upon the filing of any certificate that may
be required under Delaware law may be restored to the status of authorized but
undesignated and unissued shares of preferred stock.
10. Sinking Fund. There shall not be any sinking fund for the
redemption of any Shares of any Series of Variable Cumulative Preferred Stock.
11. Liquidation Preference.
A. In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the holders of Shares of Variable
Cumulative Preferred Stock of each Series shall be entitled to receive out of
assets of the Corporation available for distribution to stockholders, before any
distribution of assets of the Corporation is made to holders of Junior Stock,
One Thousand Dollars ($1,000) per Share plus an amount equal to accumulated and
unpaid dividends to the date of distribution.
B. If, in the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation, the amounts payable
with respect to each Series of the Variable Cumulative Preferred Stock, the
Other Outstanding Preferred Stock and any other shares of stock of the
Corporation ranking as to any such distribution on a parity with the Variable
Cumulative Preferred Stock are not paid in full, then the holders of the
Variable Cumulative Preferred Stock and of all such other shares shall share
ratably in any such distribution of assets of the Corporation in proportion to
the full respective preferential amounts to which they are entitled assuming all
amounts thereon were paid in full.
C. After payment to the holders of the Variable Cumulative
Preferred Stock of the full preferential amounts to which they are entitled, the
holders of the Shares of Variable Cumulative Preferred Stock will not be
entitled to any further participation in any distribution of assets by the
Corporation. The merger or consolidation of the Corporation into or with any
other Person shall not be or be deemed to be a liquidation, dissolution or
winding up for purposes of this Section 11.
11. Voting Rights.
A. Holders of the Variable Cumulative Preferred Stock of any
Series are not entitled to any voting rights, except as may be required by law
or as specified in this Section 12.
B. If at the time of any annual meeting of stockholders for
the election of directors, the equivalent of six quarterly dividends (whether or
not consecutive) payable on any share or shares of preferred stock of the
Corporation are in default, the number of directors
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constituting the Board of Directors will be increased by two. The holders of
record of the Variable Cumulative Preferred Stock, voting separately as a class
with the holders of shares of any one or more other series of preferred stock
upon which like voting rights have been conferred (including, without
limitation, the Outstanding Cumulative Preferred Stock), shall be entitled at
said meeting of stockholders (and at each subsequent annual meeting of
stockholders), unless all dividends in arrears have been paid or declared and
set apart for payment prior thereto, to vote for the election of two directors
of the Corporation, the holders of record of Variable Cumulative Preferred Stock
and all applicable Series of Outstanding Cumulative Preferred Stock (other than
the Series A Preferred Stock) being entitled to cast one vote per share and the
holders of record of Series A Preferred Stock being entitled to cast one-tenth
(1/10) of one vote per share, with the remaining directors of the Corporation to
be elected by the holders of record of shares of any other class or classes or
series of stock entitled to vote therefor. Until the default in payments of all
dividends which permitted the election of said directors shall cease to exist,
any director who shall have been so elected pursuant to the next preceding
sentence may be removed at any time, without cause, only by the affirmative vote
of the holders of record of the shares of preferred stock at the time entitled
to cast a majority of the votes entitled to be cast for the election of any such
director at a special meeting of such holders of record called for that purpose,
and any vacancy in such directorship thereby created or otherwise created may be
filled by the vote of such holders of record. If and when such default shall
cease to exist, the holders of record of Variable Cumulative Preferred Stock and
the holders of record of shares of any one or more series of preferred stock
upon which like voting rights have been conferred (including, without
limitation, the holders of record of the Outstanding Cumulative Preferred Stock)
shall be divested of the foregoing special voting rights, subject to revesting
in the event of each and every subsequent like default in payments of dividends.
Upon the termination of the foregoing special voting rights, the terms of office
of all persons who may have been elected directors pursuant to said special
voting rights shall forthwith terminate, and the number of directors
constituting the Board of Directors shall be reduced by two. For purposes of the
foregoing, default in the payment of dividends for the equivalent of six
quarterly dividends means, in the case of Variable Cumulative Preferred Stock
which pays dividends either more or less frequently than every quarter, default
in the payment of dividends in respect of one or more Dividend Periods
containing in the aggregate not less than 540 days.
C. Unless the vote or consent of the holders of record of a
greater number of shares shall then be required by law, the consent of the
holders of record of at least 66 2/3% of all of the Shares of all Series of
Variable Cumulative Preferred Stock and all other shares of the same class at
the time outstanding (including, without limitation, the holders of record of
the Other Outstanding Preferred Stock), given in person or by proxy, either in
writing or by a vote at a meeting called for that purpose, voting as a class
without regard to series, the holders of record of Shares of Variable Cumulative
Preferred Stock and Other Outstanding Preferred Stock (other than the Series A
Preferred Stock) being entitled to cast one vote per Share and the holders of
record of Series A Preferred Stock being entitled to cast one-tenth (1/10) of
one vote per share, shall be necessary for authorizing, effecting or validating
the amendment, alteration or repeal of any of the provisions of the Restated
Certificate of Incorporation or of any certificate amendatory thereof or
supplemental thereto (including any Certificate of Designations or any similar
document relating to any series of preferred stock) so as to affect adversely
the preferences, rights, powers or privileges of such series and any other
shares of the same class (including, without limitation, the Other Outstanding
Preferred Stock); provided, however, that in any case
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in which one or more, but not all, series of Variable Cumulative Preferred
Stock, Other Outstanding Preferred Stock or other series of such class would be
adversely affected as to the preferences, rights, powers or privileges thereof,
the affirmative consent of holders of record of shares entitled to cast at least
66 2/3% of the votes entitled to be cast by the holders of all of the shares of
all of such series that would be adversely affected (including, without
limitation, the Other Outstanding Preferred Stock), voting as a class, shall be
required in lieu thereof.
D. Unless the vote or consent of the holders of record of a
greater number of shares shall then be required by law, the consent of the
holders of record of at least 66 2/3% of all Shares of all Series of Variable
Cumulative Preferred Stock and all shares of all other series of preferred stock
ranking on a parity with the Shares, either as to dividends or upon liquidation
(including, without limitation, the Other Outstanding Preferred Stock), at the
time outstanding, given in person or by proxy, either in writing or by a vote at
a meeting called for the purpose at which the holders of record of Shares of all
Series of Variable Cumulative Preferred Stock, Other Outstanding Preferred Stock
and shares of such other series of preferred stock shall vote together as a
single class without regard to series, the holders of record of shares of all
Series of Variable Cumulative Preferred Stock and Other Outstanding Preferred
Stock (other than the Series A Preferred Stock) being entitled to cast one vote
per Share and the holders of record of Series A Preferred Stock being entitled
to cast one-tenth (1/10) of one vote per share, shall be necessary to issue,
authorize, or increase the authorized amount of, or issue or authorize any
obligations or security convertible into or evidencing a right to purchase, any
additional class or series of stock ranking prior to the Shares, Other
Outstanding Preferred Stock or such other preferred stock as to dividends or
upon liquidation.
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Appendix C
CERTIFICATE OF DESIGNATIONS
OF
6 5/8% CUMULATIVE PREFERRED STOCK
OF
J.P. MORGAN CHASE & CO.
Pursuant to Section 151 of the
General Corporation law of the State of Delaware
J.P. MORGAN CHASE & CO., a corporation organized under the
laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES that the
following resolutions were duly adopted by the Board of Directors of the
Corporation at a meeting duly held and convened on September 12, 2000, and by
the Stock Committee of the Board of Directors by unanimous written consent
executed on December 18, 2000, pursuant to the authority conferred upon the
Board of Directors by the provisions of the Restated Certificate of
Incorporation of the Corporation, which authorized the issuance of up to
200,000,000 shares of preferred stock, par value $1.00 per share, and pursuant
to authority conferred upon the Stock Committee of the Board of Directors by
Section 141(c) of the General Corporation Law of the State of Delaware, by the
By-Laws of the Corporation and by resolutions of the Board of Directors adopted
at a meeting duly convened and held on September 12, 2000:
1. The Board of Directors on September 12, 2000 adopted the
following resolutions authorizing the Stock Committee of the Board of Directors
to act on behalf of the Board of Directors in connection with the issuance of
Preferred Stock pursuant to the terms and conditions of the Agreement and Plan
of Merger, dated as of September 12, 2000, between J.P. Morgan & Co.
Incorporated ("J.P. Morgan") and the Corporation, which provided for the merger
of J.P. Morgan with and into the Corporation, with the Corporation continuing as
the surviving corporation in the merger under the name "J.P. Morgan Chase &
Co.":
RESOLVED, that it is advisable and in the best interests of
The Chase Manhattan Corporation (the "Corporation") and its stockholders for the
Corporation to enter into the Agreement and Plan of Merger between the
Corporation and J.P. Morgan & Co. Incorporated, a Delaware corporation ("J.P.
Morgan"), substantially in the form presented to this Meeting (the "Merger
Agreement"), pursuant to which, among other things: (i) J.P. Morgan would merge
with and into the Corporation (the "Merger"); (ii) in accordance with the terms
and conditions of the Merger Agreement, each then outstanding share of common
stock, par value $2.50 per share, of J.P. Morgan ("J.P. Morgan Common Stock"),
other than shares which would be cancelled and retired and cease to exist as a
result of the Merger, would be converted into 3.70 fully paid and nonassessable
shares of common stock, par value $1.00 per share, of the Corporation (the
"Common Stock"); (iii) each then outstanding share of preferred stock, without
par value, of J.P. Morgan (the "J.P. Morgan Preferred Stock"), other than (A)
shares which would be cancelled and retired and cease to exist as a result of
the Merger and (B) shares as to which the holders have properly perfected any
rights of appraisal pursuant to Section 262 of the Delaware General Corporation
Law, shall be converted into a share of a corresponding series of preferred
stock, par value $1.00 per share, of the Corporation (the "Preferred Stock"), in
each case having substantially the same terms as the respective series of J.P.
Morgan Preferred Stock being so converted (such Preferred Stock of the
Corporation to be so issued being hereinafter referred to
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as the "Merger Preferred Stock"); and (iv) the Corporation's Certificate of
Incorporation would be amended pursuant to the Merger Agreement and by virtue of
the Merger to provide for (A) the change of the name of the Corporation to "J.P.
Morgan Chase & Co." and (B) the designation of each series of Merger Preferred
Stock; and further
RESOLVED, that subject to stockholder approval of the Merger
Agreement and to the filing with the Secretary of State of the State of Delaware
of the certificates of designations referred to below with respect to each
series of Merger Preferred Stock (collectively, the "Certificates of
Designation"), the issuance of such shares of Merger Preferred Stock in
accordance with the terms of the Merger Agreement be, and it hereby is,
authorized and, upon such issuance, such shares of Merger Preferred Stock shall
be validly issued, fully paid and nonassessable and free of preemptive rights;
and further
RESOLVED, that the maximum number of shares of each series of
Merger Preferred Stock authorized to be so issued in connection with the Merger
upon conversion of the respective series of J.P. Morgan Preferred Stock shall be
as follows: (i) up to 2,444,300 shares upon conversion of J.P. Morgan's
Adjustable Rate Cumulative Preferred Stock, Series A; (ii) up to 50,000 shares
upon conversion of J.P. Morgan's Variable Cumulative Preferred Stock, Series B;
(iii) up to 50,000 shares upon conversion of J.P. Morgan's Variable Cumulative
Preferred Stock, Series C; (iv) up to 50,000 shares upon conversion of J.P.
Morgan's Variable Cumulative Preferred Stock, Series D; (v) up to 50,000 shares
upon conversion of J.P. Morgan's Variable Cumulative Preferred Stock, Series E;
(vi) up to 50,000 shares upon conversion of J.P. Morgan's Variable Cumulative
Preferred Stock, Series F; and (vii) up to 400,000 shares upon conversion of
J.P. Morgan's 6 5/8% Cumulative Preferred Stock, Series H; and further
RESOLVED, that the voting powers, preferences and special
rights of each series of Merger Preferred Stock shall be substantially identical
to the voting powers, preferences and special rights applicable to, and
specified in the certificate of designations with respect to, the respective
series of J.P. Morgan Preferred Stock to be converted into such series of Merger
Preferred Stock pursuant to the Merger, and that the Certificate of Designation
for each series of Merger Preferred Stock shall provide for the voting rights
specified in the corresponding series of J.P. Morgan Preferred Stock; and
further
RESOLVED, that the Stock Committee of the Board of Directors
be, and it hereby is, authorized to approve, within the limits specified in the
foregoing resolutions, the form, terms and provisions of each Certificate of
Designation and to take such other actions as such committee deems necessary or
desirable to effect the issuance of the Merger Preferred Stock in accordance
with these resolutions.
2. The Stock Committee of the Board of Directors on December
18, 2000, pursuant to authority conferred upon the Stock Committee of the Board
of Directors by Section 141(c) of the General Corporation Law of the State of
Delaware, by Section 3.03 of the By-Laws of the Corporation and by the
resolutions of the Board of Directors set forth above, adopted the following
resolution:
RESOLVED, that pursuant to resolutions of the Board of
Directors of the Corporation adopted on September 12, 2000, the issue of up to
400,000 shares of 6 5/8%
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Cumulative Preferred Stock, $1.00 par value, of the Corporation is hereby
authorized, and the designation, preferences and privileges, relative,
participating, optional and other special rights, and qualifications of all
400,000 shares of this series, in addition to those set forth in the Certificate
of Incorporation are hereby fixed as follows:
1. Designation. The designation of such preferred stock shall
be 6 5/8% Cumulative Preferred Stock (hereinafter referred to as the "6 5/8%
Preferred Stock") and the number of shares constituting such series is 400,000.
Shares of the 6 5/8% Preferred Stock shall have a stated value of $500 per
share. The number of authorized shares of the 6 5/8% Preferred Stock may be
reduced by further resolution duly adopted by the by the Board of Directors of
the Corporation, the Stock Committee, or any other duly authorized committee of
the Board of Directors and by the filing of a certificate pursuant to the
provisions of the General Corporation Law of the State of Delaware stating that
such reduction has been so authorized but the number of authorized shares of the
6 5/8% Preferred Stock shall not be increased.
2. Dividends. (a) Holders of shares of 6 5/8% Preferred Stock
shall be entitled to receive cash dividends when, as and if declared by the
Board of Directors of the Corporation, out of funds legally available therefor,
at a rate of 6 5/8% per annum on the stated value thereof in respect of the
period that begins on January 1, 2001 and that shall end on and include March
31, 2001 (the "Initial Dividend Period") and each quarterly dividend period
thereafter, which quarterly dividend periods shall begin on January 1, April 1,
July 1 and October 1 of each year and shall end on and include the day next
preceding the first day of the next dividend period. Such dividends shall be
cumulative from the first day of the Initial Dividend Period and shall be
payable, when, as and if declared by the Board of Directors on March 31, June
30, September 30 and December 31 of each year. Each such dividend shall be paid
to the holders of record of shares of 6 5/8% Preferred Stock at the close of
business on the fifteenth day of the month next preceding the month in which
such dividend payment is made. Dividends as provided for in this Paragraph 2, to
the extent not declared and paid for any past dividend periods, may be declared
and paid at any time, without reference to any regular dividend payment date, to
holders of record on such date, not exceeding 45 days preceding the payment date
therefor, as may be fixed by the Board of Directors of the Corporation, the
Stock Committee, or any other duly authorized committee of the Board of
Directors. Dividends payable on the 6 5/8% Preferred Stock for any period less
than a full quarterly dividend period shall be computed on the basis of a
360-day year consisting of twelve 30-day months. The amount of dividends payable
on shares of the 6 5/8% Preferred Stock for each full quarterly dividend period
(including the Initial Dividend Period) shall be computed by dividing the annual
dividend rate by four.
(b) No full dividends shall be declared or paid or set apart
for payment on Preferred Stock of any series ranking, as to dividends, on a
parity with the 6 5/8% Preferred Stock for any period unless full cumulative
dividends have been or contemporaneously are declared and paid or declared and a
sum sufficient for the payment thereof set apart for such payment on the 6 5/8%
Preferred Stock for all dividend payment periods terminating on or prior to the
date of payment of such full cumulative dividends. When dividends are not paid
in full, as aforesaid, upon the shares of the 6 5/8% Preferred Stock and any
other Preferred Stock ranking on a parity as to dividends with the 6 5/8%
Preferred Stock, all dividends declared upon shares of the 6 5/8% Preferred
Stock and any other Preferred Stock ranking on a parity as to dividends with the
6 5/8%
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Preferred Stock shall be declared pro rata so that the amount of dividends
declared per share on the 6 5/8% Preferred Stock and such other Preferred Stock
shall in all cases bear to each other the same ratio that accrued dividends per
share on the shares of the 6 5/8% Preferred Stock and such other Preferred Stock
bear to each other. Holders of shares of the 6 5/8% Preferred Stock shall not be
entitled to any dividend, whether payable in cash, property or stocks, in excess
of full cumulative dividends, as herein provided, on the 6 5/8% Preferred Stock.
No interest, or sum of money in lieu of interest, shall be payable in respect if
any dividend payment of payments on the 6 5/8% Preferred Stock which may in
arrears.
3. Redemption. The 6 5/8% Preferred Stock shall not be
redeemable prior to March 31, 2006. On or after March 31, 2006, the Corporation,
at its option, with prior approval of the appropriate bank regulators, if so
required, may redeem the 6 5/8% Preferred Stock, as a whole or in part, at any
time or from time to time out of funds legally available therefor, at a
redemption price of $500 per share plus an amount equal to accrued and unpaid
dividends thereon to the date fixed for redemption.
In the event the Corporation shall redeem shares of 6 5/8%
Preferred Stock, notice of such redemption shall be given by first class mail,
postage prepaid, mailed not less than 30 nor more than 60 days prior to the
redemption date, to each holder of record of the shares to be redeemed, at such
holder's address as the same appears on the stock register of the Corporation.
Each such notice shall state: (1) the redemption date; (2) the number of shares
of 6 5/8% Preferred Stock to be redeemed and, if less than all the shares held
by such holder are to be redeemed, the number of such shares to be redeemed from
such holder; (3) the redemption price; (4) the place or places where
certificates for such shares are to be surrendered for payment of the redemption
price; and (5) that dividends on the shares to be redeemed will cease to accrue
on such redemption date. Notice having been mailed as aforesaid, from and after
the redemption date (unless default shall be made by the Corporation in
providing money for the payment of the redemption price) dividends on the shares
of the 6 5/8% Preferred Stock so called for redemption shall cease to accrue,
and said shares shall no longer be deemed to be outstanding, and all rights of
the holders thereof as stockholders of the Corporation (except the right to
receive from the Corporation the redemption price) shall cease. Upon surrender
in accordance with said notice of the certificates for any shares so redeemed
(properly endorsed or assigned for transfer, if the Board of Directors of the
Corporation shall so require and the notice shall so state), such shares shall
be redeemed by the Corporation at the redemption price aforesaid. If less than
all the outstanding shares of the 6 5/8% Preferred Stock are to be redeemed,
shares to be redeemed shall be selected by the Corporation from outstanding
shares of 6 5/8% Preferred Stock not previously called for redemption by lot or
pro rata (as nearly as may be) or by any other method determined by the
Corporation in its sole discretion to be equitable. A new certificate shall be
issued representing the unredeemed shares without cost to the holder thereof.
Notwithstanding the foregoing provisions of this Section 3, if
any dividends on the 6 5/8% Preferred Stock are in arrears, no shares of the
6 5/8% Preferred Stock shall be redeemed unless all outstanding shares of the
6 5/8% Preferred Stock are simultaneously redeemed, and the Corporation shall
not purchase or otherwise acquire any shares of such Series; provided, however,
that the foregoing shall not prevent the purchase or acquisition of shares of
the 6 5/8% Preferred Stock pursuant to a purchase or exchange offer made on the
same terms to holders of all outstanding shares of the 6 5/8% Preferred Stock.
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4. Shares to be Retired. All shares of the 6 5/8% Preferred
Stock redeemed by the Corporation shall be retired and canceled and shall not be
reissued as shares of 6 5/8% Preferred Stock and upon the filing of any document
required by the Delaware General Corporation Law shall be restored to the status
of authorized but unissued shares of preferred stock, without designation as to
series.
5. Conversion or Exchange. The holders of shares of the 6 5/8%
Preferred Stock shall not have any rights to convert such shares into or
exchange such shares for shares of any other class or classes or of any other
series of any class or classes of capital stock of the Corporation.
6. Voting. The 6 5/8% Preferred Stock shall have no voting
powers either general or special except as otherwise required by law and as
hereinafter provided in this Section 6.
If at the time of any annual meeting of stockholders for the
election of directors, the equivalent of six quarterly dividends (whether or not
consecutive) payable on any share or shares of preferred stock are in default,
the number of directors constituting the Board of Directors of the Corporation
shall automatically be increased by two. The holders of record of the 6 5/8%
Preferred Stock, voting separately as a class with the holders of shares of any
one or more other series of preferred stock upon which like voting rights have
been conferred (including, without limitation, the Corporation's Adjustable Rate
Cumulative Preferred Stock, Series A (the "Series A Preferred Stock"), Variable
Cumulative Preferred Stock, Series B through F, 10.84% Cumulative Preferred
Stock, Adjustable Cumulative Preferred Stock, Series L, and Adjustable
Cumulative Preferred Stock, Series N (collectively, the "Outstanding Cumulative
Preferred Stock")), shall be entitled at said meeting of stockholders (and at
each subsequent annual meeting of stockholders), unless all dividends in arrears
have been paid or declared and set apart for payment prior thereto, to vote for
the election of two directors of the Corporation, the holders of record of the
6 5/8% Preferred Stock and the Outstanding Cumulative Preferred Stock (other
than the Series A Preferred Stock) being entitled to cast one vote per share and
the holders of record of the Series A Preferred Stock being entitled to cast
one-tenth (1/10) of one vote per share, with the remaining directors of the
Corporation to be elected by the holders of record of shares of any other class
or classes or series of stock entitled to vote therefor. Until the default in
payments of all dividends which permitted the election of said directors shall
cease to exist, any director who shall have been so elected pursuant to the next
preceding sentence may be removed at any time, without cause, only by the
affirmative vote of the holders of record of the shares of preferred stock at
the time entitled to cast a majority of the votes entitled to be cast for the
election of any such director at a special meeting of such holders of record
called for that purpose, and any vacancy in such directorship thereby created or
otherwise created may be filled only by the affirmative vote of the holders of
record of the shares of preferred stock at the time entitled to cast a majority
of the votes entitled to be cast for the election of any such director. If and
when such default shall cease to exist, the holders of record of the 6 5/8%
Preferred Stock and the holders of record of shares of any one or more series of
preferred stock upon which like voting rights have been conferred (including,
without limitation, the Outstanding Cumulative Preferred Stock) shall be
divested of the foregoing special voting rights, subject to reinvesting in the
event of each and every subsequent like default in payments of dividends. Upon
the termination of the foregoing special voting rights, the terms of office of
all persons who may
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have been elected directors pursuant to said special voting rights will
terminate, and the number of directors constituting the Board of Directors shall
be automatically reduced by two. For the purposes of the foregoing, default in
the payment of dividends for the equivalent of six quarterly dividends means, in
the case of Preferred Stock which pays dividends either more or less frequently
than every quarter, default in the payment of dividends in respect of one or
more Dividend Periods containing in the aggregate not less than 540 days.
Unless the vote or consent of the holders of a greater number
of shares shall then be required by law, the consent of the holders of record of
at least 66 2/3% of all of the voting power of the 6 5/8% Preferred Stock and
all other shares of the same class at the time outstanding (including, without
limitation, the Outstanding Cumulative Preferred Stock and the Corporation's
Fixed/Adjustable Rate Noncumulative Preferred Stock (collectively with the
Outstanding Cumulative Preferred Stock, the "Other Preferred Stock")), given in
person or by proxy, either in writing or by a vote at a meeting called for that
purpose, voting as a class without regard to series, the holders of record of
the 6 5/8% Preferred Stock and the Other Preferred Stock (other than the Series
A Preferred Stock) being entitled to cast one vote per share and the holders of
record of the Series A Preferred Stock being entitled to cast one-tenth (1/10)
of one vote per share, shall be necessary for authorizing, effecting or
validating the amendment, alteration or repeal of any of the provisions of the
Restated Certificate of Incorporation or of any certificate amendatory thereof
or supplemental thereto (including any Certificate of Designations, Rights and
Preferences or any similar document relating to any series of preferred stock)
so as to materially adversely affect the preferences, rights, powers or
privileges of the 6 5/8% Preferred Stock and any other shares of the same class
(including, without limitation, the Other Preferred Stock); provided, however,
that in any case in which one or more, but not all, series of Other Preferred
Stock or 6 5/8% Preferred Stock or other series of such class would be
materially adversely affected as to the preferences, rights, powers or
privileges thereof, the affirmative consent of holders of record of shares
entitled to cast at least 66 2/3% of the votes entitled to be cast by the
holders of all of the shares of all of the series that would be adversely
affected, voting as a class, shall be required in lieu thereof.
Unless the vote or consent of the holders of record of a
greater number of shares shall then be required by law, the consent of the
holders of record of at least 66 2/3% of all of the voting power of the shares
of the 6 5/8% Preferred Stock and all shares of all other series of preferred
stock ranking on a parity (including, without limitation, the Other Preferred
Stock) with shares of the 6 5/8% Preferred Stock, either as to dividends or upon
liquidation, at the time outstanding, given in person or by proxy, either in
writing or by a vote at a meeting called for the purpose at which the holders of
record of shares of the 6 5/8% Preferred Stock, the Other Preferred Stock and
shares of such other series of preferred stock shall vote together as a single
class without regard to series, the holders of record of the 6 5/8% Preferred
Stock and the Other Preferred Stock (other than the Series A Preferred Stock)
being entitled to cast one vote per share and holders of record of Series A
Preferred Stock being entitled to cast one-tenth (1/10) of one vote per share,
shall be necessary to issue, authorize, or increase the authorized amount of, or
issue or authorize any obligation or security convertible into or evidencing a
right to purchase, any additional class or series of stock ranking prior to the
6 5/8% Preferred Stock, Other Preferred Stock or such other preferred stock as
to dividends or upon liquidation.
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7. Liquidation Preference. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation, the
holders of the 6 5/8% Preferred Stock shall be entitled to receive out of the
assets of the Corporation available for distribution to stockholders, before any
distribution of assets shall be made to the holders of Common Stock or of any
other shares of stock of the Corporation ranking as to such a distribution
junior to the 6 5/8% Preferred Stock, an amount equal to $500 per share plus an
amount equal to any accrued and unpaid dividends thereon (whether or not earned
or declared) to the date fixed for payment of such distribution. If upon any
voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, the amounts payable with respect to the 6 5/8% Preferred Stock and
any other shares of stock of the Corporation ranking as to any such distribution
on a parity with the 6 5/8% Preferred Stock are not paid in full, the holders of
the 6 5/8% Preferred Stock and of such other shares shall share ratably in any
such distribution of assets of the Corporation in proportion to the full
respective preferential amounts to which they are entitled. After payment to the
holders of the 6 5/8% Preferred Stock of the full preferential amounts provided
for in this Section 7, the holders of the 6 5/8% Preferred Stock shall be
entitled to no further participation in any distribution of assets by the
Corporation.
Neither the sale, conveyance, exchange or transfer of all or
substantially all the property or business of the Corporation, the merger or
consolidation of the Corporation into or with any other corporation nor the
merger or consolidation of any other corporation into or with the Corporation
shall be deemed to be a dissolution, liquidation or winding up, voluntary or
involuntary, of the Corporation for the purposes of this Section 7.
8. Limitation on Dividends on Junior Ranking Stock. So long as
any of the 6 5/8% Preferred Stock shall be outstanding, the Corporation shall
not declare any dividends on the Common Stock of the Corporation or any other
stock of the Corporation ranking as to dividends or distribution of assets
junior to the 6 5/8% Preferred Stock (the "Junior Stock"), or make any payment
on account of, or set apart money for, a sinking or other analogous fund for the
purchase, redemption or other retirement of any shares of Junior Stock, or make
any distribution in respect thereof, whether in cash or property or in
obligations or stock of the Corporation, other than Junior Stock (such
dividends, payments, setting apart and distributions being herein called "Junior
Stock Payments"), unless full cumulative dividends shall have been paid or
declared and set apart for payment upon all outstanding shares of preferred
stock other than Junior Stock, at the date of such declaration in the case of
any such dividend, or the date of such setting apart in the case of any such
fund, or the date of such payment or distribution in the case of any other
Junior Stock Payment.
9. Ranking of Stock of the Corporation. For purposes of this
resolution, any stock of any class or classes of the Corporation shall be deemed
to rank:
(1) prior to the shares of the 6 5/8% Preferred Stock, either
as to dividends or upon liquidation, if the holders of such class or classes
shall be entitled to the receipt of dividends or of amounts distributable upon
dissolution, liquidation or winding up of the Corporation, as the case may be,
in preference or priority to the holders of shares of the 6 5/8% Preferred
Stock;
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(2) on a parity with shares of the 6 5/8% Preferred Stock,
either as to dividends or upon liquidation, whether or not the dividend rates,
dividend payment dates or redemption or liquidation prices per share or sinking
fund provisions, if any, be different from those of the 6 5/8% Preferred Stock,
if the holders of such stock shall be entitled to the receipt of dividends or of
amounts distributable upon dissolution, liquidation or winding up of the
Corporation, as the case may be, in proportion to their respective dividend
rates or liquidation prices, without preference or priority, one over the other,
as between the holders of such stock and the holders of shares of the 6 5/8%
Preferred Stock; and
(3) junior to shares of the 6 5/8% Preferred Stock, either as
to dividends or upon liquidation, if such class shall be Common Stock or if the
holders of shares of the 6 5/8% Preferred Stock shall be entitled to receipt of
dividends or of amounts distributable upon dissolution, liquidation or winding
up of the Corporation, as the case may be, in preference or priority to the
holders of shares of such class or classes.
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Appendix D
CERTIFICATE OF DESIGNATIONS
OF
ADJUSTABLE RATE CUMULATIVE PREFERRED STOCK, SERIES L
OF
J.P. MORGAN CHASE & CO.
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
J.P. MORGAN CHASE & CO., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES
that the following resolutions were duly adopted by the Board of Directors of
the Corporation on December 21, 1993 and by the Preferred Stock Committee of the
Board of Directors on June 1, 1994, respectively, pursuant to authority
conferred upon the Board of Directors by the provisions of the Certificate of
Incorporation of the Corporation which authorize the issuance of up to
200,000,000 shares of preferred stock, $100 stated value per share ($1 par
value) (the "Preferred Stock"), and pursuant to authority conferred upon the
Preferred Stock Committee of the Board of Directors by Section 141(c) of the
General Corporation Law of the State of Delaware, by the By-Laws of the
Corporation and by the resolutions of the Board of Directors adopted at a
meeting duly convened and held on December 21, 1993:
1. The Board of Directors on December 21, 1993 adopted the
following resolutions authorizing a Preferred Stock Committee of the Board of
Directors to act on behalf of the Board of Directors in connection with the
issuance of the Preferred Stock and fixing the voting rights of the Preferred
Stock:
"RESOLVED that the Preferred Stock Committee may, without
further action of the Board of Directors of J.P. Morgan Chase & Co.
(the "Corporation"), from time to time authorize the issuance and sale
from time to time, of (i) one or more series of the Corporation's
preferred stock, $1 par value (the "Preferred Stock"); (ii) depositary
shares each representing a fraction of a share of Preferred Stock
("Depositary Shares"); (iii) warrants to purchase any shares of
Preferred Stock or Depositary Shares; (iv) warrants to purchase shares
of the Corporation's common stock, $1 par value ("Common Stock"); and
(v) any shares of Preferred Stock or Common Stock into which or for
which any of the foregoing may be exchangeable, convertible, or
issuable upon exercise (all of the foregoing hereinafter collectively
referred to as the "Preferred Shares" unless the context shall
otherwise require), for cash or other property, as shall be determined
by the Preferred Stock Committee, subject to the limitations
hereinafter set forth, and any such Preferred Shares may be sold
through agents, through underwriters, through dealers and directly to
purchasers, in one or more offerings registered under the Securities
Act of 1933 (the "Act") or in transactions not required to be
registered under the Act, all as shall be determined by the Preferred
Stock Committee; and any such issuance and sale of Preferred Shares,
including the issuance from time to time of any warrants for such
Preferred Shares, common or preferred stock of the Corporation into
which any series of Preferred Shares may be convertible or exchangeable
and the issuance and sale from time to time of Depositary Shares or
warrants for Depositary Shares be, and hereby is, authorized and
approved;
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RESOLVED that the Preferred Stock Committee be, and hereby is,
authorized and empowered to act on behalf and in the stead of the Board
of Directors in connection with the issuance of one or more series of
the Preferred Shares and, in connection therewith, is hereby
authorized, to the fullest extent permitted by the Delaware General
Corporation Law as it now exists or is hereafter amended, to determine
the price at which the Preferred Shares of each such series will be
sold by the Corporation, to declare dividends payable on the Preferred
Shares, to reserve for issuance on the books of the Corporation or
otherwise a sufficient number of shares of any of the Corporation's
common stock or Preferred Stock into which any series of the Preferred
Stock may be convertible or exchangeable and to determine the
designation, preferences and privileges, the relative, participating,
optional or other special rights, and the qualifications, limitations
and restrictions thereof;
RESOLVED that, without limiting the generality of the
preceding resolution, the Preferred Stock Committee is hereby expressly
authorized:
(i) to determine whether the Preferred Shares will be
issued in one or more series and the number of shares of any
such series;
(ii) to fix the dividend rate or rates of any such
shares and/or the methods of determining dividends and the
dates on which dividends shall be payable;
(iii) to determine whether dividends of any series of
Preferred Shares shall be cumulative or noncumulative and, if
cumulative, the dates from which dividends shall commence to
cumulate;
(iv) to determine the conversion or exchange
provisions, if any, of the shares of any series of the
Preferred Shares, including without limitation, the class and
series of capital stock of the Corporation into which such
shares shall be convertible or exchangeable;
(v) to determine whether the Corporation shall elect
to offer (a) warrants for such Preferred Shares ("Warrants")
or (b) Depositary Shares evidenced by depositary receipts,
each representing a fraction (to be determined by the
Preferred Stock Committee) of a share of a particular series
of the Preferred Stock, which shares of Preferred Stock will
be issued and deposited with a depositary, in each case, in
lieu of offering full shares of such series of the Preferred
Stock;
(vi) to fix the liquidation preference of the shares
of any series of the Preferred Shares, subject to the
limitation that the aggregate liquidation preference over
Common Stock of all the Preferred Shares issued shall not
exceed $850,000,000;
(vii) to determine whether any warrants for Preferred
Stock, Depositary Shares or Common Stock shall be issued,
whether alone or in connection with any other Preferred
Shares, and the terms and conditions of any such warrants;
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(viii) to determine whether the shares of any series
of the Preferred Shares shall be subject to redemption,
optional or mandatory or pursuant to a sinking fund, and, if
such series shall be subject to redemption, the redemption
provisions of such series; and
(ix) to fix or determine any additional dividend,
liquidation, redemption, sinking fund and other rights,
preferences, privileges, limitations and restrictions thereof;
RESOLVED that the Preferred Stock Committee be, and hereby is,
authorized and empowered to authorize, approve and take such other
action as is deemed advisable in connection with the issuance of one or
more series of the Preferred Shares, including, without limitation, the
following:
(i) selecting the underwriters, dealers and agents,
if any, to or through which the Preferred Shares will be sold
and offered;
(ii) approving the form and substance, and the
execution and delivery, of any underwriting agreement, agency
agreement, placement agreement or other agreement to be
entered into by the Corporation in connection with the
issuance and sale of the Preferred Shares, including, without
limitation, setting the amount of any underwriting discounts
and other items constituting underwriters' compensation and
any discounts and commissions allowed or paid to dealers or
agents;
(iii) selecting the bank or trust company which will
act as depositary if Depositary Shares are offered and
approving the form and substance, and the execution and
delivery, of any deposit agreement to be entered into by the
Corporation with such depositary; and
(iv) appointing a registrar and transfer agent for
the registration, transfer and exchange of the Preferred
Shares and appointing a dividend disbursing agent for the
Preferred Shares;
RESOLVED that for each series of Preferred Shares a
certificate shall be prepared and filed on behalf of the Corporation
with the Secretary of State of the State of Delaware pursuant to
Section 151 of the General Corporation Law of the State of Delaware (a
"Certificate of Designation"); that each such Certificate of
Designation be in such form as is approved by action of the Board of
Directors or the Preferred Stock Committee; and that the proper
officers of the Corporation be and hereby are authorized to execute and
file each such Certificate of Designation pursuant to the General
Corporation Law of the State of Delaware;
RESOLVED that the Certificate of Designation for each series
of the Preferred Shares shall provide that the shares of such series
shall not have any voting powers either general or special, except
that:
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(i) Unless the vote or consent of the holders of a
greater number of shares shall then be required by law, the
consent of the holders of at least 66 2/3% of all of the
shares of any series at the time outstanding, given in person
or by proxy, either in writing or by a vote at a meeting
called for the purpose at which the holders of shares of such
series shall vote together as a separate class, shall be
necessary for authorizing, effecting or validating the
amendment, alteration or repeal of any of the provisions of
the Certificate of Incorporation or of any certificate
amendatory thereof or supplemental thereto (including any
Certificate of Designation or any similar document relating to
any series of Preferred Stock) which would affect adversely
the preferences, rights, powers or privileges of such series;
(ii) Unless the vote or consent of the holders of a
greater number of shares shall then be required by law, the
consent of the holders of at least 66 2/3 % of all of the
shares of any such series and all other series of Preferred
Stock ranking on a parity with shares of such series, either
as to dividends or upon liquidation, at the time outstanding,
given in person or by proxy, either in writing or by a vote at
a meeting called for the purposes at which the holders of
shares of such series and such other series of Preferred Stock
shall vote together as a single class without regard to
series, shall be necessary for authorizing, effecting or
validating the creation, authorization or issue of any shares
of any class of stock of the Corporation ranking prior to the
shares of such series as to dividends or upon liquidation, or
the reclassification of any authorized stock of the
Corporation into any such prior shares, or the creation,
authorization or issue of any obligation or security
convertible into or evidencing the right to purchase any such
prior shares; and
(iii) If at the time of any annual meeting of the
Corporation's stockholders for the election of directors there
is a default in preference dividends on the Preferred Stock,
the number of directors constituting the Board of Directors of
the Corporation shall be increased by two, and the holders of
the Preferred Stock of all series (whether or not the holders
of such series of Preferred Stock would be entitled to vote
for the election of directors if such default in preference
dividends did not exist), shall have the right at such
meeting, voting together as a single class without regard to
series, to the exclusion of the holders of Common Stock to
elect two directors of the Corporation to fill such newly
created directorships. Such right shall continue until there
are no dividends in arrears upon the Preferred Stock. Each
director elected by the holders of shares of Preferred Stock
(a "Preferred Director"), shall continue to serve as such
director for the full term for which he or she shall have been
elected, notwithstanding that prior to the end of such term a
default in preference dividends shall cease to exist. Any
Preferred Director may be removed by, and shall not be removed
except by, the vote of the holders of record of the
outstanding shares of Preferred Stock, voting together as a
single class without regard to series, at a meeting of the
Corporation's stockholders, or of the holders of shares of
Preferred Stock, called for the purpose. So long as a default
in any preference dividends on the Preferred Stock shall
exist, (a) any vacancy in the office of a Preferred Director
may be filled (except as
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provided in the following clause (b)) by an instrument in
writing signed by the remaining Preferred Director and filed
with the Corporation and (b) in the case of the removal of any
Preferred Director, the vacancy may be filled by the vote of
the holders of the outstanding shares of Preferred Stock,
voting together as a single class without regard to series, at
the same meeting at which such removal shall be voted. Each
director appointed as aforesaid by the remaining Preferred
Director shall be deemed, for all purposes hereof, to be a
Preferred Director. Whenever the term of office of the
Preferred Directors shall end and a default in preference
dividends shall no longer exist, the number of directors
constituting the Board of Directors of the Corporation shall
be reduced by two. For the purposes hereof, a "default in
preference dividends" on the Preferred Stock shall be deemed
to have occurred whenever the amount of accrued dividends upon
any series of the Preferred Stock shall be equivalent to six
full quarter-yearly dividends or more, and, having so
occurred, such default shall be deemed to exist thereafter
until, but only until, all accrued dividends on all shares of
Preferred Stock of each and every series then outstanding
shall have been paid to the end of the last preceding dividend
period."
2. The Preferred Stock Committee of the Board of Directors on
June 1, 1994, pursuant to the authority conferred upon the Preferred Stock
Committee of the Board of Directors by Section 141(c) of the General Corporation
Law of the State of Delaware, by Section 3.03 of the By-Laws of the Corporation
and by the resolutions of the Board of Directors set forth above, adopted the
following resolution:
RESOLVED that, pursuant to resolutions of the Board of
Directors of J.P. Morgan Chase & Co. (the "Corporation") adopted on
December 21, 1993, the issue of 2,000,000 shares of Adjustable Rate
Cumulative Preferred Stock, Series L, $100 stated value per share ($1
par value) of the Corporation ranking on a parity with the series of
Preferred Stock of the Corporation designated as the Corporation's
"Adjustable Rate Cumulative Preferred Stock, Series C", the
Corporation's "10.96% Preferred Stock", the Corporation's "10%
Convertible Preferred Stock", the Corporation's "8-3/8% Preferred
Stock", the Corporation's "7.92% Cumulative Preferred Stock", the
Corporation's "7.58% Cumulative Preferred Stock" and the Corporation's
"7-1/2% Cumulative Preferred Stock" is hereby authorized and the
designation, preferences and privileges, relative, participating,
optional and other special rights, and qualifications, limitations and
restrictions of all 2,000,000 shares of this Series, in addition to
those set forth in the Certificate of Incorporation of the Corporation
and, with respect to voting rights, in the resolutions of the Board of
Directors of the Corporation adopted on December 21, 1993, are hereby
fixed as follows:
1. Designation. The designation of this Series shall
be Adjustable Rate Cumulative Preferred Stock, Series L
(hereinafter referred to as this "Series") and the number of
shares constituting this Series shall be 2,000,000. Shares of
this Series shall have a stated value of $100. The number of
authorized shares of this Series may be reduced by further
resolution duly adopted by the Board of Directors of the
Corporation or the Preferred Stock Committee of the Board of
Directors and by the filing of a certificate pursuant to the
provisions of
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the General Corporation Law of the State of Delaware stating
that such reduction has been so authorized, but the number of
authorized shares of this Series shall not be increased.
2. Dividends. (a) Dividends payable on the shares of
this Series for the period from June 8, 1994 to June 30, 1994
(the "Initial Dividend Period") shall be $0.3838 per share.
For each quarterly dividend period after the Initial Dividend
Period (a "Quarterly Dividend Period"; the Initial Dividend
Period and any Quarterly Dividend Period being hereinafter
referred to individually as a "Dividend Period") dividends
payable on the shares of this Series shall be payable at a
rate per annum of the stated value thereof equal to the
Applicable Rate (as defined in Section 3) in respect of such
Quarterly Dividend Period, expressed as a percentage to the
nearest ten thousandth of a percentage point. The amount of
dividends per share for each Quarterly Dividend Period shall
be computed by dividing the Applicable Rate for such Quarterly
Dividend Period by four and applying the resulting rate to the
stated value per share of the Series. Each Quarterly Dividend
Period shall commence on the January 1, April 1, July 1 and
October 1, as the case may be, following the last day of the
Initial Dividend Period or the preceding Quarterly Dividend
Period, as the case may be, and shall end on and include the
day next preceding the first day of the next such Quarterly
Dividend Period. Dividends shall be cumulative from June 8,
1994 and shall be payable, when and as declared by the Board
of Directors or by the Preferred Stock Committee of the Board
of Directors, on March 31, June 30, September 30 and December
31 of each year, commencing on June 30, 1994. Each such
dividend shall be paid to the holders of record of shares of
this Series as they appear on the stock register of the
Corporation on such record date, not exceeding 45 days
preceding the payment date thereof, as shall be fixed by the
Board of Directors of the Corporation or by the Preferred
Stock Committee of the Board of Directors. Dividends on
account of arrears for any past Dividend Periods may be
declared and paid at any time, without reference to any
regular dividend payment date, to holders of record on such
date, not exceeding 45 days preceding the payment date
thereof, as may be fixed by the Board of Directors of the
Corporation or by the Preferred Stock Committee of the Board
of Directors.
(b) Dividends payable on this Series for any period
greater or less than a full Dividend Period, other than the
Initial Dividend Period, shall be computed on the basis of a
360-day year consisting of twelve 30-day months and the actual
number of days elapsed in the period.
(c) No full dividends shall be declared or paid or
set apart for payment on the Preferred Stock of any series
ranking, as to dividends, on a parity with or junior to this
Series for any period unless full cumulative dividends have
been or contemporaneously are declared and paid or declared
and a sum sufficient for the payment thereof set apart for
such payment on this Series for all Dividend Periods
terminating on or prior to the date of payment of such full
cumulative dividends. When dividends are not paid in full, as
aforesaid, upon the shares of this Series and any other series
of Preferred Stock ranking on a parity as to dividends with
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this Series, all dividends declared upon shares of this Series
and any other series of Preferred Stock ranking on a parity as
to dividends with this Series shall be declared pro rata so
that the amount of dividends declared per share on this Series
and such other Preferred Stock shall in all cases bear to each
other the same ratio that accrued and unpaid dividends per
share on the shares of this Series and such other Preferred
Stock bear to each other. Holders of shares of this Series
shall not be entitled to any dividend, whether payable in
cash, property or stock, in excess of full cumulative
dividends, as herein provided, on this Series. No interest, or
sum of money in lieu of interest, shall be payable in respect
of any dividend payment or payments on this Series which may
be in arrears.
(d) So long as any shares of this Series are
outstanding, no dividend (other than a dividend in Common
Stock or in any other stock ranking junior to this Series as
to dividends and upon liquidation and other than as provided
in paragraph (c) of this Section 2) shall be declared or paid
or set aside for payment or other distribution declared or
made upon the Common Stock or upon any other stock ranking
junior to or on a parity with this Series as to dividends or
upon liquidation, nor shall any Common Stock or any other
stock of the Corporation ranking junior to or on a parity with
this Series as to dividends or upon liquidation be redeemed,
purchased or otherwise acquired for any consideration (or any
moneys be paid to or made available for a sinking fund for the
redemption of any shares of any such stock) by the Corporation
(except by conversion into or exchange for stock of the
Corporation ranking junior to this Series as to dividends and
upon liquidation) unless, in each case, the full cumulative
dividends on all outstanding shares of this Series shall have
been paid or declared and set aside for payment for all past
Dividend Periods.
3. Definition of Applicable Rate, etc. (a) Except as provided
below in this paragraph, the "Applicable Rate" for any Quarterly
Dividend Period will be equal to 84% of the Effective Rate (as
hereinafter defined). The "Effective Rate" for any Quarterly Dividend
Period will be equal to the highest of the Treasury Bill Rate, the Ten
Year Constant Maturity Rate and the Thirty Year Constant Maturity Rate
(each as hereinafter defined) for such Quarterly Dividend Period. In
the event that the Corporation determines in good faith that for any
reason
(i) any one of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Thirty Year Constant Maturity
Rate cannot be determined for any Quarterly Dividend Period,
then the Effective Rate for such Quarterly Dividend Period
will be equal to the higher of whichever two of such Rates can
be so determined;
(ii) only one of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Thirty Year Constant Maturity
Rate can be determined for any Quarterly Dividend Period, then
the Effective Rate for such Quarterly Dividend Period will be
equal to whichever such Rate can be so determined; or
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(iii) none of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Thirty Year Constant Maturity
Rate can be determined for any Quarterly Dividend Period, then
the Effective Rate for the preceding dividend period will be
continued for such Quarterly Dividend Period.
Anything herein to the contrary notwithstanding, the
Applicable Rate for any Quarterly Dividend Period shall in no
event be less than 4.50% per annum or greater than 10.50% per
annum.
(b) Except as described below in this paragraph, the
"Treasury Bill Rate" for each Quarterly Dividend Period will
be the arithmetic average of the two most recent weekly per
annum market discount rates (or the one weekly per annum
market discount rate, if only one such rate is published
during the relevant Calendar Period (as hereinafter defined))
for three-month U.S. Treasury bills, as published weekly by
the Federal Reserve Board (as hereinafter defined) during the
Calendar Period immediately preceding the last ten calendar
days preceding the Quarterly Dividend Period for which the
dividend rate on this Series is being determined. In the event
that the Federal Reserve Board does not publish such a weekly
per annum market discount rate during such Calendar Period,
then the Treasury Bill Rate for such Quarterly Dividend Period
will be the arithmetic average of the two most recent weekly
per annum market discount rates (or the one weekly per annum
market discount rate, if only one such rate is published
during the relevant Calendar Period) for three-month U.S.
Treasury bills, as published weekly during such Calendar
Period by any Federal Reserve Bank or by any U.S. Government
department or agency selected by the Corporation. In the event
that a per annum market discount rate for three-month U.S.
Treasury bills is not published by the Federal Reserve Board
or by any Federal Reserve Bank or by any U.S. Government
department or agency during such Calendar Period, then the
Treasury Bill Rate for such Quarterly Dividend Period will be
the arithmetic average of the two most recent weekly per annum
market discount rates (or the one weekly per annum market
discount rate, if only one such rate is published during the
relevant Calendar Period) for all of the U.S. Treasury bills
then having remaining maturities of not less than 80 nor more
than 100 days, as published during such Calendar Period by the
Federal Reserve Board or, if the Federal Reserve Board does
not publish such rates, by any Federal Reserve Bank or by any
U.S. Government department or agency selected by the
Corporation. In the event that the Corporation determines in
good faith that for any reason no such U.S. Treasury bill
rates are published as provided above during such Calendar
Period, then the Treasury Bill Rate for such Quarterly
Dividend Period will be the arithmetic average of the per
annum market discount rates based upon the closing bids during
such Calendar Period for each of the issues of marketable
non-interest-bearing U.S. Treasury securities with a remaining
maturity of not less than 80 nor more than 100 days from the
date of each such quotation, as chosen and quoted daily for
each business day in New York City (or less frequently if
daily quotations is not generally available) to the
Corporation by at least three recognized dealers in U.S.
Government securities selected by the Corporation. In the
event that the Corporation determines in good faith that for
any reason the
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Corporation cannot determine the Treasury Bill Rate for any
Quarterly Dividend Period as provided above in this paragraph,
the Treasury Bill Rate for such Quarterly Dividend Period will
be the arithmetic average of the per annum market discount
rates based upon the closing bids during such Calendar Period
for each of the issues of marketable interest-bearing U.S.
Treasury securities with a remaining maturity of not less than
80 nor more than 100 days, as chosen and quoted daily for each
business day in New York City (or less frequently if daily
quotations are not generally available) to the Corporation by
at least three recognized dealers in U.S. Government
securities selected by the Corporation.
(c) Except as described below in this paragraph, the
"Ten Year Constant Maturity Rate" for each Quarterly Dividend
Period will be the arithmetic average of the two most recent
weekly per annum Ten Year Average Yields (as hereinafter
defined) (or the one weekly per annum Ten Year Average Yield,
if only one such Yield is published during the relevant
Calendar Period), as published weekly by the Federal Reserve
Board during the Calendar Period immediately preceding the
last ten calendar days preceding the Quarterly Dividend Period
for which the dividend rate on this Series is being
determined. In the event that the Federal Reserve Board does
not publish such a weekly per annum Ten Year Average Yield
during such Calendar Period, then the Ten Year Constant
Maturity Rate for such Quarterly Dividend Period will be the
arithmetic average of the two most recent weekly per annum Ten
Year Average Yields (or the one weekly per annum Ten Year
Average Yield, if only one such Yield is published during such
Calendar Period), as published weekly during such Calendar
Period by any Federal Reserve Bank or by any U.S. Government
department or agency selected by the Corporation. In the event
that a per annum Ten Year Average Yield is not published by
the Federal Reserve Board or by any Federal Reserve Bank or by
any U.S. Government department or agency during such Calendar
Period, then the Ten Year Constant Maturity Rate for such
Quarterly Dividend Period will be the arithmetic average of
the two most recent weekly per annum average yields to
maturity (or the one weekly per annum average yield to
maturity, if only one such yield is published during the
relevant Calendar Period) for all of the actively traded
marketable U.S. Treasury fixed interest rate securities (other
than Special Securities (as hereinafter defined)) then having
remaining maturities of not less than eight nor more than
twelve years, as published during such Calendar Period by the
Federal Reserve Board or, if the Federal Reserve Board does
not publish such yields, by any Federal Reserve Bank or by any
U.S. Government department or agency selected by the
Corporation. In the event that the Corporation determines in
good faith that for any reason the Corporation cannot
determine the Ten Year Constant Maturity Rate for any
Quarterly Dividend Period as provided above in this paragraph,
then the Ten Year Constant Maturity Rate for such Quarterly
Dividend Period will be the arithmetic average of the per
annum average yields to maturity based upon the closing bids
during such Calendar Period for each of the issues of actively
traded marketable U.S. Treasury fixed interest rate securities
(other than Special Securities) with a final maturity date not
less than eight nor more than twelve years from the date of
each such quotation, as chosen and quoted daily for each
business day in New
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York City (or less frequently if daily quotations are not
generally available) to the Corporation by at least three
recognized dealers in U.S. Government securities selected by
the Corporation.
(d) Except as described below in this paragraph, the
"Thirty Year Constant Maturity Rate" for each Quarterly
Dividend Period will be the arithmetic average of the two most
recent weekly per annum Thirty Year Average Yields (as
hereinafter defined) (or the one weekly per annum Thirty Year
Average Yield, if only one such Yield is published during the
relevant Calendar Period), as published weekly by the Federal
Reserve Board during the Calendar Period immediately preceding
the last ten calendar days preceding the Quarterly Dividend
Period for which the dividend rate on this Series is being
determined. In the event that the Federal Reserve Board does
not publish such a weekly per annum Thirty Year Average Yield
during such Calendar Period, then the Thirty Year Constant
Maturity Rate for such Quarterly Dividend Period will be the
arithmetic average of the two most recent weekly per annum
Thirty Year Average Yields (or the one weekly per annum Thirty
Year Average Yield, if only one such Yield is published during
the relevant Calendar Period), as published weekly during such
Calendar Period by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Corporation.
In the event that a per annum Thirty Year Average Yield is not
published by the Federal Reserve Board or by any Federal
Reserve Bank or by any U.S. Government department or agency
during such Calendar Period, then the Thirty Year Constant
Maturity Rate for such Quarterly Dividend Period will be the
arithmetic average of the two most recent weekly per annum
average yields to maturity (or the one weekly per annum
average yield to maturity, if only one such yield is published
during the relevant Calendar Period) for all of the actively
traded marketable U.S. Treasury fixed interest rate securities
(other than Special Securities) then having remaining
maturities of not less than twenty-eight nor more than thirty
years, as published during such Calendar Period by the Federal
Reserve Board or, if the Federal Reserve Board does not
publish such yields, by any Federal Reserve Bank or by any
U.S. Government department or agency selected by the
Corporation. In the event that the Corporation determines in
good faith that for any reason the Corporation cannot
determine the Thirty Year Constant Maturity for any Quarterly
Dividend Period as provided above in this paragraph, the
Thirty Year Constant Maturity Rate for such Quarterly Dividend
Period will be the arithmetic average of the per annum average
yields to maturity based upon the closing bids during such
Calendar Period for each of the issues of actively traded
marketable U.S. Treasury fixed interest rate securities (other
than Special Securities) with a final maturity date not less
than twenty-eight nor more than thirty years from the date of
each such quotation, as chosen and quoted daily for each
business day in New York City (or less frequently if daily
quotations are not generally available) to the Corporation by
at least three recognized dealers in U.S. Government
securities selected by the Corporation.
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(e) The Treasury Bill Rate, the Ten Year Constant
Maturity Rate and the Thirty Year Constant Maturity Rate shall
each be rounded to the nearest five hundredths of a percent.
(f) The Applicable Rate with respect to each
Quarterly Dividend Period will be calculated as promptly as
practicable by the Corporation according to the appropriate
method described above. The Corporation will cause each
Applicable Rate to be published in a newspaper of general
circulation in New York City before the commencement of the
Quarterly Dividend Period to which it applies and will cause
notice of such Applicable Rate to be enclosed with the
dividend payment checks next mailed to the holders of this
Series.
(g) For purposes of this Section,
(i) "Calendar Period" means a period of
fourteen calendar days;
(ii) "Federal Reserve Board" means the Board
of Governors of the Federal Reserve System;
(iii) "Special Securities" means securities
which can, at the option of the holder, be
surrendered at face value in payment of any Federal
estate tax or which provide tax benefits to the
holder and are priced to reflect such tax benefits or
which were originally issued at a deep or substantial
discount;
(iv) "Ten Year Average Yield" means the
average yield to maturity for actively traded
marketable U.S. Treasury fixed interest rate
securities (adjusted to constant maturities of ten
years); and
(v) "Thirty Year Average Yield" means the
average yield to maturity for actively traded
marketable U.S. Treasury fixed interest rate
securities (adjusted to constant maturities of thirty
years).
4. Redemption. (a) The shares of this Series are not
redeemable prior to June 30, 1999. The Corporation, at its
option, may redeem shares of this Series, as a whole or in
part, at any time or from time to time, on or after June 30,
1999, at a redemption price of $100 per share plus accrued and
unpaid dividends thereon to the date fixed for redemption.
(b) In the event that fewer than all the outstanding
shares of this Series are to be redeemed, the number of shares
to be redeemed shall be determined by the Board of Directors
of the Corporation or the Preferred Stock Committee of the
Board of Directors and the shares to be redeemed shall be
determined by lot or pro rata as may be determined by the
Board of Directors of the Corporation or the Preferred Stock
Committee of the Board of Directors or by any other method as
may be determined by the Board of Directors of the Corporation
or the Preferred Stock Committee of the Board of Directors in
its sole discretion to be equitable,
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provided that such method satisfies any applicable
requirements of any securities exchange on which this Series
is listed.
(c) In the event the Corporation shall redeem shares
of this Series, notice of such redemption shall be given by
first class mail, postage prepaid, mailed not less than 30 or
more than 60 days prior to the redemption date, to each holder
of record of the shares to be redeemed, at such holder's
address as the same appears on the stock register of the
Corporation. Each such notice shall state: (i) the redemption
date; (ii) the number of shares of this Series to be redeemed
and, if fewer than all the shares held by such holder are to
be redeemed, the number of such shares to be redeemed from
such holder; (iii) the redemption price; (iv) the place or
places where certificates for such shares are to be
surrendered for payment of the redemption price; and (v) that
dividends on the shares to be redeemed will cease to accrue on
the redemption date.
(d) Notice having been mailed as aforesaid, from and
after the redemption date (unless default shall be made by the
Corporation in providing money for the payment of the
redemption price) dividends on the shares of this Series so
called for redemption shall cease to accrue, and said shares
shall no longer be deemed to be outstanding, and all rights of
the holders thereof as stockholders of the Corporation (except
the right to receive from the Corporation the redemption
price) shall cease. Upon surrender in accordance with said
notice of the certificates for any shares so redeemed
(properly endorsed or assigned for transfer, if the Board of
Directors of the Corporation or the Preferred Stock Committee
of the Board of Directors shall so require and the notice
shall so state), such shares shall be redeemed by the
Corporation at the redemption price aforesaid. In case fewer
than all the shares represented by any such certificate are
redeemed, a new certificate shall be issued representing the
unredeemed shares without cost to the holder thereof.
(e) Any shares of this Series which shall at any time
have been redeemed shall, after such redemption, have the
status of authorized but unissued shares of Preferred Stock,
without designation as to series until such shares are once
more designated as part of a particular series by the Board of
Directors of the Corporation or the Preferred Stock Committee
of the Board of Directors.
(f) Notwithstanding the foregoing provisions of this
Section 4, if any dividends on this Series are in arrears, no
shares of this Series shall be redeemed unless all outstanding
shares of this Series are simultaneously redeemed, and the
Corporation shall not purchase or otherwise acquire any shares
of this Series; provided, however, that the foregoing shall
not prevent the purchase or acquisition of shares of this
Series pursuant to a purchase or exchange offer made on the
same terms to holders of all outstanding shares of this
Series.
5. Conversion. The holders of shares of this Series
shall not have any rights to convert such shares into shares
of any other class or series of capital stock of the
Corporation.
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6. Liquidation Rights. (a) Upon the voluntary or
involuntary dissolution, liquidation or winding up of the
Corporation, the holders of the shares of this Series shall be
entitled to receive and to be paid out of the assets of the
Corporation available for distribution to its stockholders,
before any payment or distribution shall be made on the Common
Stock or on any other class of stock ranking junior to this
Series upon liquidation, the amount of $100 per share, plus
accrued and unpaid dividends thereon.
(b) After the payment to the holders of the shares of
this Series of the full preferential amounts provided for in
this Section 6, the holders of this Series as such shall have
no right or claim to any of the remaining assets of the
Corporation.
(c) If, upon any voluntary or involuntary
dissolution, liquidation, or winding up of the Corporation,
the amounts payable with respect to the stated value of the
shares of this Series and any other shares of stock of the
Corporation ranking as to any such distribution on a parity
with the shares of this Series are not paid in full, the
holders of the shares of this Series and of such other shares
will share ratably in any such distribution of assets of the
Corporation in proportion to the full respective stated values
to which they are entitled.
(d) Neither the sale of all or substantially all the
property or business of the Corporation, nor the merger or
consolidation of the Corporation into or with any other
corporation or the merger or consolidation of any other
corporation into or with the Corporation, shall be deemed to
be a dissolution, liquidation or winding up, voluntary or
involuntary, for the purposes of this Section 6.
(e) Upon the dissolution, liquidation or winding up
of the Corporation, the holders of shares of this Series then
outstanding shall be entitled to be paid out of the assets of
the Corporation available for distribution to its stockholders
all amounts to which such holders are entitled pursuant to
paragraph (a) of this Section 6 before any payment shall be
made to the holder of any class of capital stock of the
Corporation ranking junior to this Series upon liquidation.
7. Ranking. For purposes of this resolution, any
stock of any class or classes of the Corporation shall be
deemed to rank:
(a) prior to the shares of this Series, either as to
dividends or upon liquidation, if the holders of such class or
classes shall be entitled to the receipt of dividends or of
amounts distributable upon dissolution, liquidation or winding
up of the Corporation, as the case may be, in preference or
priority to the holders of shares of this Series;
(b) on a parity with shares of this Series, either as
to dividends or upon liquidation, whether or not the dividend
rates, dividend payment dates or redemption or liquidation
prices per share or sinking fund provisions, if any, be
different from those of this Series, if the holders of such
stock shall be entitled to
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the receipt of dividends or of amounts distributable upon
dissolution, liquidation or winding up of the Corporation, as
the case may be, without preference or priority, one over the
other, as between the holders of such stock and the holders of
shares of this Series; and
(c) junior to shares of this Series, either as to
dividends or upon liquidation, if such class shall be Common
Stock or if the holders of shares of this Series shall be
entitled to receipt of dividends or of amounts distributable
upon dissolution, liquidation or winding up of the
Corporation, as the case may be, in preference or priority to
the holders of shares of such class or classes.
8. Voting Rights. The shares of this Series shall
have the voting rights set forth in the resolutions of the
Board of Directors of the Corporation adopted on December 21,
1993."
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Appendix E
CERTIFICATE OF DESIGNATIONS
OF
10.84% CUMULATIVE PREFERRED STOCK
OF
J.P. MORGAN CHASE & CO.
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
J.P. MORGAN CHASE & CO., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES
that the following resolutions were adopted by the Board of Directors of the
Corporation at meetings duly convened and held on August 27, 1995 and October
17, 1995, and by the Preferred Stock Committee of the Board of Directors by
unanimous written consent executed on March 19, 1996, pursuant to authority
conferred upon the Board of Directors by the provisions of the Restated
Certificate of Incorporation of the Corporation which authorize the issuance of
up to 200,000,000 shares of preferred stock, $1 par value (the "Preferred
Stock"), and pursuant to authority conferred upon the Preferred Stock Committee
of the Board of Directors by Section 141(c) of the General Corporation Law of
the State of Delaware, by the By-Laws of the Corporation and by resolutions of
the Board of Directors adopted at a meeting duly convened and held on August 27,
1995:
1. The Board of Directors on August 27, 1995 adopted the
following resolutions authorizing the Preferred Stock Committee of the Board of
Directors to act on behalf of the Board of Directors in connection with the
issuance of Preferred Stock pursuant to the terms and conditions of the
Agreement and Plan of Merger, dated as of August 27, 1995, between The Chase
Manhattan Corporation ("Chase") and the Corporation (then named Chemical Banking
Corporation), which provided for the merger of Chase with and into the
Corporation, with the Corporation continuing as the surviving corporation in the
merger under the name "The Chase Manhattan Corporation":
"RESOLVED, that it is advisable and in the best interests of
the Corporation and its stockholders for the Corporation to enter into the
Agreement and Plan of Merger between the Corporation and The Chase Manhattan
Corporation, a Delaware corporation ("Chase"), substantially in the form
presented to this Meeting (the "Merger Agreement"), pursuant to which, among
other things, (i) Chase would merge with and into the Corporation (the "Merger")
and, in accordance with the terms and conditions of the Merger Agreement, (ii)
each then outstanding share of common stock, par value $2.00 per share, of Chase
("Chase Common Stock"), other than shares which would be cancelled and retired
and cease to exist as a result of the Merger, would be converted into 1.04 fully
paid and nonassessable shares of common stock, par value $1.00 per share, of the
Corporation ("Common Stock"), which shares would, pursuant to the Rights
Agreement, dated as of April 13, 1989 (as amended, the "Rights Agreement"),
between the Corporation and Chemical Bank, as Rights Agent, be accompanied by a
corresponding number of Chemical Rights (as defined in the Merger Agreement),
and (iii) each share (other than shares which would be cancelled and retired and
cease to exist as a result of the Merger) of Preferred Stock, 10-1/2% Series G;
Preferred Stock, 9.76% Series H; Preferred Stock, 10.84% Series I; Preferred
Stock, 9.08% Series J; Preferred Stock, 8-1/2% Series K; Preferred Stock,
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8.32% Series L; Preferred Stock, 8.40% Series M; and Preferred Stock, Adjustable
Rate Series N of Chase would be converted into one share of a series of
preferred stock, par value $1.00 per share, of the Corporation ("Preferred
Stock"), as provided for in the Merger Agreement, in each case having terms
substantially identical to the terms of the series of preferred stock of Chase
being so converted (such Preferred Stock of the Corporation to be so issued
being hereinafter referred to as the "Merger Preferred Stock"); and further
"RESOLVED, that subject to stockholder approval of the Merger
Agreement and to the filing with the Secretary of State of the State of Delaware
of the certificates of designations referred to below with respect to each
series of Merger Preferred Stock (collectively, the "Certificates of
Designations"), the issuance of such shares of Merger Preferred Stock in
accordance with the terms of the Merger Agreement be, and it hereby is,
authorized and, upon such issuance, such shares of Merger Preferred Stock shall
be validly issued, fully paid and nonassessable and free of preemptive rights;
and further
"RESOLVED, that the maximum number of shares of each series of
Merger Preferred Stock authorized to be so issued in connection with the Merger
shall be as follows: up to 5,600,000 shares upon conversion of Chase's Preferred
Stock, 10-1/2% Series G; up to 4,000,000 shares upon conversion of Chase's
Preferred Stock, 9.76% Series H; up to 8,000,000 shares upon conversion of
Chase's Preferred Stock, 10.84% Series I; up to 6,000,000 shares upon conversion
of Chase's Preferred Stock, 9.08% Series J; up to 6,800,000 shares upon
conversion of Chase's Preferred Stock, 8-1/2% Series K; up to 9,600,000 shares
upon conversion of Chase's Preferred Stock, 8.32% Series L; up to 6,900,000
shares upon conversion of Chase's Preferred Stock, 8.40% Series M; and up to
9,100,000 shares upon conversion of Chase's Preferred Stock, Adjustable Rate
Series N; and further
"RESOLVED, that the voting powers, preferences and special
rights of each series of Merger Preferred Stock shall be substantially identical
to the voting powers, preferences and special rights applicable to, and
specified in the certificate of designations with respect to, the respective
series of preferred stock of Chase to be converted into such series of Merger
Preferred Stock pursuant to the Merger; and further
"RESOLVED, that the Preferred Stock Committee of the Board of
Directors be, and it hereby is, authorized to approve, within the limits
specified in the foregoing resolutions, the form, terms and provisions of each
Certificate of Designations and to take such other actions as such committee
deems necessary or desirable to effect the issuance of the Merger Preferred
Stock in accordance with these resolutions."
2. The Board of Directors on October 17, 1995 adopted the
following resolutions fixing the voting rights of the Preferred Stock authorized
by the preceding resolutions:
"RESOLVED, that the Certificate of Designations for each
series of preferred stock, par value $1.00 per share (the "Preferred Stock"), of
the Corporation to be issued in connection with the merger of The Chase
Manhattan Corporation ("Chase") with and into the Corporation, upon the
conversion of the Preferred Stock, 10-1/2% Series G; Preferred Stock, 9.76%
Series H; Preferred Stock, 10.84% Series I; Preferred Stock, 9.08% Series J;
Preferred
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Stock, 8-1/2% Series K; Preferred Stock, 8.32% Series L; Preferred Stock, 8.40%
Series M; and Preferred Stock, Adjustable Rate Series N of Chase, shall be
modified to provide that the shares of such series shall not have any voting
powers either general or special, except that:
"If at the time of any annual meeting of the Corporation's
stockholders for the election of directors there is a default in
preference dividends on the Preferred Stock, the number of directors
constituting the Board of Directors of the Corporation shall be
increased by two, and the holders of the Preferred Stock of all series
(whether or not the holders of such series of Preferred Stock would be
entitled to vote for the election of directors if such default in
preference dividends did not exist), shall have the right at such
meeting, voting together as a single class without regard to series, to
the exclusion of the holders of common stock, par value $1.00 per
share, of the Corporation, to elect two directors of the Corporation to
fill such newly created directorships. Such right shall continue until
there are no dividends in arrears upon the Preferred Stock. Each
director elected by the holders of shares of Preferred Stock (a
"Preferred Director") shall continue to serve as such director for the
full term for which he shall have been elected, notwithstanding that
prior to the end of such term a default in preference dividends shall
cease to exist. Any Preferred Director may be removed by, and shall not
be removed except by, the vote of the holders of record of the
outstanding shares of Preferred Stock, voting together as a single
class without regard to series, at a meeting of the Corporation's
stockholders, or of the holders of shares of Preferred Stock, called
for the purpose. So long as a default in any preference dividends on
the Preferred Stock shall exist, (a) any vacancy in the office of a
Preferred Director may be filled (except as provided in the following
clause (b)) by an instrument in writing signed by the remaining
Preferred Director and filed with the Corporation and (b) in the case
of the removal of any Preferred Director, the vacancy may be filled by
the vote of the holders of the outstanding shares of Preferred Stock,
voting together as a single class without regard to series, at the same
meeting at which such removal shall be voted. Each director appointed
as aforesaid by the remaining Preferred Director shall be deemed, for
all purposes hereof, to be a Preferred Director. Whenever the term of
office of the Preferred Directors shall end and a default in preference
dividends shall no longer exist, the number of directors constituting
the Board of Directors of the Corporation shall be reduced by two. For
the purposes hereof, a "default in preference dividends" on the
Preferred Stock shall be deemed to have occurred whenever the amount of
accrued dividends upon any series of the Preferred Stock shall be
equivalent to six full quarter-yearly dividends or more, and, having so
occurred, such default shall be deemed to exist thereafter until, but
only until, all accrued dividends on all shares of Preferred Stock of
each and every series then outstanding shall have been paid to the end
of the last preceding dividend period; and
"Without the consent of the holders of shares entitled to cast
at least two-thirds of the votes entitled to be cast by the holders of
the total number of shares of Preferred Stock then outstanding, voting
as a class without regard to series, the holders of shares of this
series being entitled to cast one vote per share thereon, the
Corporation may not: (a) create any class or series of stock which
shall have preference as to dividends or distribution of assets over
any outstanding series of the Preferred Stock other than a series which
shall not have any right to object to such creation or (b) alter or
change the
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provisions of the Corporation's Certificate of Incorporation, as
amended, so as to adversely affect the voting power, preferences or
special rights of the holders of Preferred Stock; provided, however,
that if such creation or such alteration or change would adversely
affect the voting power, preferences or special rights of one or more,
but not all, series of Preferred Stock at the time outstanding, consent
of the holders of shares entitled to cast at least two-thirds of the
votes entitled to be cast by the holders of all of the shares of all
such series so affected, voting as a class, shall be required in lieu
of the consent of the holders of shares entitled to cast at least
two-thirds of the votes entitled to be cast by the holders of the total
number of shares of Preferred Stock at the time outstanding."
3. The Preferred Stock Committee of the Board of Directors on
March 19, 1996, pursuant to the authority conferred upon the Preferred Stock
Committee of the Board of Directors by Section 141(c) of the General Corporation
Law of the State of Delaware, by Section 3.03 of the By-Laws of the Corporation
and by the resolutions of the Board of Directors set forth above, adopted the
following resolution:
"RESOLVED, that pursuant to resolutions of the Board of Directors of
the Corporation adopted on August 27, 1995 and October 17, 1995, the issue of up
to Eight Million (8,000,000) shares of 10.84% Cumulative Preferred Stock, $1.00
par value, of the Corporation is hereby authorized, and the designation,
preferences and privileges, relative, participating, optional and other special
rights, and qualifications, limitations and restrictions of all 8,000,000 shares
of this series, in addition to those set forth in the Certificate of
Incorporation of the Corporation and, with respect to voting rights, in the
resolutions of the Board of Directors of the Corporation adopted on October 17,
1995, are hereby fixed as follows:
1. Designation. The designation of such series shall be
"10.84% Cumulative Preferred Stock" (hereinafter referred to as the
"10.84% Preferred Stock") and the number of shares constituting such
series is Eight Million (8,000,000). The number of authorized shares of
10.84% Preferred Stock may be reduced by further resolution duly
adopted by the Board of Directors of the Corporation or any duly
authorized committee thereof and by the filing of a certificate
pursuant to the provisions of the General Corporation Law of the State
of Delaware stating that such reduction has been so authorized, but the
number of authorized shares of 10.84% Preferred Stock shall not be
increased. The 10.84% Preferred Stock shall rank on a parity as to
dividends and distributions of assets with the series of Preferred
Stock, $1.00 par value, of the Corporation designated as "10.96%
Preferred Stock", "8-3/8% Preferred Stock", "7.92% Cumulative Preferred
Stock", "7.58% Cumulative Preferred Stock", "7-1/2% Cumulative
Preferred Stock", "Adjustable Rate Cumulative Preferred Stock, Series
L", "10-1/2% Cumulative Preferred Stock", "9.76% Cumulative Preferred
Stock", "9.08% Cumulative Preferred Stock", "8-1/2% Cumulative
Preferred Stock", "8.32% Cumulative Preferred Stock", "8.40% Cumulative
Preferred Stock", and "Adjustable Rate Cumulative Preferred Stock,
Series N".
2. Dividends. The annual dividend rate of the 10.84% Preferred
Stock shall be $2.71 on each outstanding share of such stock, and no
more. Dividends shall be payable on the shares of the 10.84% Preferred
Stock, when and as declared by the Board
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of Directors, for the Initial Dividend Period (as defined below) and
each quarterly dividend period (a "Quarterly Dividend Period")
thereafter (the Initial Dividend Period and each such subsequent
Quarterly Dividend Period being hereinafter referred to as a "Dividend
Period" and collectively referred to as "Dividend Periods"), which
Quarterly Dividend Periods shall commence on March 31, June 30,
September 30 and December 31 in each year, commencing with the first
such date to occur after the effective time of the merger of The Chase
Manhattan Corporation ("Chase") with and into the Corporation (the
"Effective Time"), and shall end on and include the day next preceding
the first day of the next Quarterly Dividend Period. The Initial
Dividend Period is the period commencing on the most recent date next
preceding the Effective Time on which a dividend was paid on the
Preferred Stock, 10.84% Series I of Chase (the "Chase 10.84% Preferred
Stock") (or commencing on the date of the Effective Time if such date
was such a dividend payment date) and shall end on and include the date
next preceding the first day of the next Quarterly Dividend Period;
provided, however, that in the event the Effective Time shall occur
after the record date for the payment of a regular quarterly dividend
on the Chase 10.84% Preferred Stock, but prior to the payment date for
such dividend, then the Initial Dividend Period shall be the first
Quarterly Dividend Period as described in the preceding sentence.
Dividends shall be cumulative from the date on which the Initial
Dividend Period commences and shall be payable, when and as declared by
the Board of Directors, on March 31, June 30, September 30 and December
31 in each year, commencing with such date that next follows the end of
the Initial Dividend Period. Each such dividend shall be paid to the
holders of record of shares of 10.84% Preferred Stock as they appear on
the stock register of the Corporation on such record date, not
exceeding 30 days preceding the payment date thereof, as shall be fixed
by the Board of Directors of the Corporation. Dividends on account of
arrears for any past dividend periods may be declared and paid at any
time, without reference to any quarterly dividend payment date, to
holders of record on such date, not exceeding 45 days preceding the
payment date thereof, as may be fixed by the Board of Directors of the
Corporation. In the event that there shall be outstanding shares of any
other series of Preferred Stock ranking on a parity as to dividends
with the 10.84% Preferred Stock, the Corporation, in making any
dividend payment on account of arrears on the 10.84% Preferred Stock or
such other series of Preferred Stock, shall make payments ratably upon
all outstanding shares of 10.84% Preferred Stock and such other series
of Preferred Stock in proportion to the respective amounts of dividends
in arrears upon all such outstanding shares of 10.84% Preferred Stock
and such other series of Preferred Stock to the date of such dividend
payment. No interest, or sum of money in lieu of interest, shall be
payable in respect of any dividend payment or payments which may be in
arrears. Dividends payable on the 10.84% Preferred Stock for any period
less than a full quarter (after the initial dividend period) shall be
computed on the basis of a 360 day year.
3. Redemption. On or after June 30, 2001, the Corporation, at
its option, may redeem shares of the 10.84% Preferred Stock, as a whole
or in part, at any time or from time to time at a redemption price of
$25 per share plus accrued and unpaid dividends thereon to the date
fixed for redemption.
In the event the Corporation shall redeem shares of 10.84%
Preferred Stock, notice of such redemption shall be given by first
class mail, postage prepaid, mailed not
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less than 30 nor more than 60 days prior to the redemption date, to
each holder of record of the shares to be redeemed, at such holder's
address as the same appears on the stock register of the Corporation.
Each such notice shall state: (1) the redemption date; (2) the number
of shares of 10.84% Preferred Stock to be redeemed and, if less than
all the shares held by such holder are to be redeemed, the number of
such shares to be redeemed from such holder; (3) the redemption price;
(4) the place or places where certificates for such shares are to be
surrendered for payment of the redemption price; and (5) that dividends
on the shares to be redeemed will cease to accrue on such redemption
date. Notice having been mailed as aforesaid, from and after the
redemption date (unless default shall be made by the Corporation in
providing money for the payment of the redemption price) dividends on
the shares of the 10.84% Preferred Stock so called for redemption shall
cease to accrue, and said shares shall no longer be deemed to be
outstanding, and all rights of the holders thereof as stockholders of
the Corporation (except the right to receive from the Corporation the
redemption price) shall cease. Upon surrender in accordance with said
notice of the certificates for any shares so redeemed (properly
endorsed or assigned for transfer, if the Board of Directors of the
Corporation or any duly authorized committee thereof shall so require
and the notice shall so state), such shares shall be redeemed by the
Corporation at the redemption price aforesaid. If less than all the
outstanding shares of 10.84% Preferred Stock are to be redeemed, shares
to be redeemed shall be selected by the Corporation from outstanding
shares of 10.84% Preferred Stock not previously called for redemption
by lot or pro rata (as nearly as may be) or by any other method
determined by the Corporation in its sole discretion to be equitable.
In no event shall the Corporation redeem less than all the
outstanding shares of 10.84% Preferred Stock pursuant to the first
paragraph of this Section 3 or purchase or otherwise acquire any shares
of 10.84% Preferred Stock unless full cumulative dividends shall have
been paid or declared and set apart for payment upon all outstanding
shares of 10.84% Preferred Stock for all past Dividend Periods;
provided, however, that the foregoing shall not prevent the purchase or
acquisition of shares of 10.84% Preferred Stock pursuant to a purchase
or exchange offer made on the same terms to holders of all outstanding
shares of 10.84% Preferred Stock.
4. Shares to be Retired. All shares of 10.84% Preferred Stock
redeemed or purchased by the Corporation shall be retired and cancelled
and shall be restored to the status of authorized but unissued shares
of Preferred Stock, without designation as to series, and may
thereafter be issued, but not as shares of 10.84% Preferred Stock.
5. Conversion or Exchange. The holders of shares of 10.84%
Preferred Stock shall not have any rights herein to convert such shares
into or exchange such shares for shares of any other class or classes
or of any other series of any class or classes of capital stock of the
Corporation.
6. Voting. The shares of 10.84% Preferred Stock shall not have
any voting powers either general or special, except that:
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If at the time of any annual meeting of the
Corporation's stockholders for the election of directors there
is a default in preference dividends on the Preferred Stock,
the number of directors constituting the Board of Directors of
the Corporation shall be increased by two, and the holders of
the Preferred Stock of all series (whether or not the holders
of such series of Preferred Stock would be entitled to vote
for the election of directors if such default in preference
dividends did not exist), shall have the right at such
meeting, voting together as a single class without regard to
series, to the exclusion of the holders of common stock, par
value $1.00 per share, of the Corporation, to elect two
directors of the Corporation to fill such newly created
directorships. Such right shall continue until there are no
dividends in arrears upon the Preferred Stock. Each director
elected by the holders of shares of Preferred Stock (a
"Preferred Director") shall continue to serve as such director
for the full term for which he shall have been elected,
notwithstanding that prior to the end of such term a default
in preference dividends shall cease to exist. Any Preferred
Director may be removed by, and shall not be removed except
by, the vote of the holders of record of the outstanding
shares of Preferred Stock, voting together as a single class
without regard to series, at a meeting of the Corporation's
stockholders, or of the holders of shares of Preferred Stock,
called for the purpose. So long as a default in any preference
dividends on the Preferred Stock shall exist, (a) any vacancy
in the office of a Preferred Director may be filled (except as
provided in the following clause (b)) by an instrument in
writing signed by the remaining Preferred Director and filed
with the Corporation and (b) in the case of the removal of any
Preferred Director, the vacancy may be filled by the vote of
the holders of the outstanding shares of Preferred Stock,
voting together as a single class without regard to series, at
the same meeting at which such removal shall be voted. Each
director appointed as aforesaid by the remaining Preferred
Director shall be deemed, for all purposes hereof, to be a
Preferred Director. Whenever the term of office of the
Preferred Directors shall end and a default in preference
dividends shall no longer exist, the number of directors
constituting the Board of Directors of the Corporation shall
be reduced by two. For the purposes hereof, a "default in
preference dividends" on the Preferred Stock shall be deemed
to have occurred whenever the amount of accrued dividends upon
any series of the Preferred Stock shall be equivalent to six
full quarter-yearly dividends or more, and, having so
occurred, such default shall be deemed to exist thereafter
until, but only until, all accrued dividends on all shares of
Preferred Stock of each and every series then outstanding
shall have been paid to the end of the last preceding dividend
period; and
Without the consent of the holders of shares entitled
to cast at least two-thirds of the votes entitled to be cast
by the holders of the total number of shares of Preferred
Stock then outstanding, voting as a class without regard to
series, the holders of shares of this series being entitled to
cast one vote per share thereon, the Corporation may not: (a)
create any class or series of stock which shall have
preference as to dividends or distribution of assets over any
outstanding series of the Preferred Stock other than a series
which shall not have any right to object to such creation or
(b) alter or change the provisions of the Corporation's
Certificate
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of Incorporation, as amended, so as to adversely affect the
voting power, preferences or special rights of the holders of
Preferred Stock; provided, however, that if such creation or
such alteration or change would adversely affect the voting
power, preferences or special rights of one or more, but not
all, series of Preferred Stock at the time outstanding,
consent of the holders of shares entitled to cast at least
two-thirds of the votes entitled to be cast by the holders of
all of the shares of all such series so affected, voting as a
class, shall be required in lieu of the consent of the holders
of shares entitled to cast at least two-thirds of the votes
entitled to be cast by the holders of the total number of
shares of Preferred Stock at the time outstanding.
7. Liquidation Preference. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation,
the holders of the 10.84% Preferred Stock shall be entitled to receive
out of the assets of the Corporation available for distribution to
stockholders, before any distribution of assets shall be made to the
holders of Common Stock or of any other shares of stock of the
Corporation ranking as to such a distribution junior to the 10.84%
Preferred Stock, an amount equal to $25 per share plus an amount equal
to any accrued and unpaid dividends thereon to the date fixed for
payment of such distribution. If upon any voluntary or involuntary
liquidation, dissolution or winding up of the Corporation, the amounts
payable with respect to the 10.84% Preferred Stock and any other shares
of stock of the Corporation ranking as to any such distribution on a
parity with the 10.84% Preferred Stock are not paid in full, the
holders of the 10.84% Preferred Stock and of such other shares shall
share ratably in any such distribution of assets of the Corporation in
proportion to the full respective preferential amounts to which they
are entitled. After payment to the holders of the 10.84% Preferred
Stock of the full preferential amounts provided for in this Section 7,
the holders of the 10.84% Preferred Stock shall be entitled to no
further participation in any distribution of assets by the Corporation.
The consolidation or merger of the Corporation with or into any other
corporation, or the sale of substantially all the assets of the
Corporation in consideration for the issuance of equity securities of
another corporation, shall not be regarded as a liquidation,
dissolution or winding up of the Corporation within the meaning of this
Section 7, but only if such consolidation, merger or sale of assets
shall not in any way impair the voting power, preferences or special
rights of the 10.84% Preferred Stock.
8. Limitation on Dividends on Junior Ranking Stock. So long as
any 10.84% Preferred Stock shall be outstanding, the Corporation shall
not declare any dividends on the Common Stock or any other stock of the
Corporation ranking as to dividends or distributions of assets junior
to the 10.84% Preferred Stock (the Common Stock and any such other
stock being herein referred to as "Junior Stock"), or make any payment
on account of, or set apart money for, a sinking or other analogous
fund for the purchase, redemption or other retirement of any shares of
Junior Stock, or make any distribution in respect thereof, whether in
cash or property or in obligations or stock of the Corporation, other
than Junior Stock (such dividends, payments, setting apart and
distributions being herein called "Junior Stock Payments"), unless all
of the conditions set forth in the following subsections A and B shall
exist at the date of such declaration in the case of
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any such dividend, or the date of such setting apart in the case of any
such fund, or the date of such payment or distribution in the case of
any other Junior Stock Payment:
A. Full cumulative dividends shall have been paid or
declared and set apart for payment upon all outstanding shares
of Preferred Stock other than Junior Stock.
B. The Corporation shall not be in default or in
arrears with respect to any sinking or other analogous fund or
any call for tenders obligation or other agreement for the
purchase, redemption or other retirement of any shares of
Preferred Stock other than Junior Stock."
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Appendix F
CERTIFICATE OF DESIGNATIONS
OF
ADJUSTABLE RATE CUMULATIVE PREFERRED STOCK, SERIES N
OF
J.P. MORGAN CHASE & CO.
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
J.P. MORGAN CHASE & CO., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES
that the following resolutions were adopted by the Board of Directors of the
Corporation at meetings duly convened and held on August 27, 1995 and October
17, 1995, and by the Preferred Stock Committee of the Board of Directors by
unanimous written consent executed on March 19, 1996, pursuant to authority
conferred upon the Board of Directors by the provisions of the Restated
Certificate of Incorporation of the Corporation which authorize the issuance of
up to 200,000,000 shares of preferred stock, $1 par value (the "Preferred
Stock"), and pursuant to authority conferred upon the Preferred Stock Committee
of the Board of Directors by Section 141(c) of the General Corporation Law of
the State of Delaware, by the By-Laws of the Corporation and by resolutions of
the Board of Directors adopted at a meeting duly convened and held on August 27,
1995:
1. The Board of Directors on August 27, 1995 adopted the
following resolutions authorizing the Preferred Stock Committee of the Board of
Directors to act on behalf of the Board of Directors in connection with the
issuance of Preferred Stock pursuant to the terms and conditions of the
Agreement and Plan of Merger, dated as of August 27, 1995, between The Chase
Manhattan Corporation ("Chase") and the Corporation (then named Chemical Banking
Corporation), which provided for the merger of Chase with and into the
Corporation, with the Corporation continuing as the surviving corporation in the
merger under the name "The Chase Manhattan Corporation":
"RESOLVED, that it is advisable and in the best interests of
the Corporation and its stockholders for the Corporation to enter into the
Agreement and Plan of Merger between the Corporation and The Chase Manhattan
Corporation, a Delaware corporation ("Chase"), substantially in the form
presented to this Meeting (the "Merger Agreement"), pursuant to which, among
other things, (i) Chase would merge with and into the Corporation (the "Merger")
and, in accordance with the terms and conditions of the Merger Agreement, (ii)
each then outstanding share of common stock, par value $2.00 per share, of Chase
("Chase Common Stock"), other than shares which would be cancelled and retired
and cease to exist as a result of the Merger, would be converted into 1.04 fully
paid and nonassessable shares of common stock, par value $1.00 per share, of the
Corporation ("Common Stock"), which shares would, pursuant to the Rights
Agreement, dated as of April 13, 1989 (as amended, the "Rights Agreement"),
between the Corporation and Chemical Bank, as Rights Agent, be accompanied by a
corresponding number of Chemical Rights (as defined in the Merger Agreement),
and (iii) each share (other than shares which would be cancelled and retired and
cease to exist as a result of the Merger) of Preferred Stock, 10-1/2% Series G;
Preferred Stock, 9.76% Series H; Preferred Stock, 10.84% Series I; Preferred
Stock, 9.08% Series J; Preferred Stock, 8-1/2% Series K; Preferred Stock,
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8.32% Series L; Preferred Stock, 8.40% Series M; and Preferred Stock, Adjustable
Rate Series N of Chase would be converted into one share of a series of
preferred stock, par value $1.00 per share, of the Corporation ("Preferred
Stock"), as provided for in the Merger Agreement, in each case having terms
substantially identical to the terms of the series of preferred stock of Chase
being so converted (such Preferred Stock of the Corporation to be so issued
being hereinafter referred to as the "Merger Preferred Stock"); and further
"RESOLVED, that subject to stockholder approval of the Merger
Agreement and to the filing with the Secretary of State of the State of Delaware
of the certificates of designations referred to below with respect to each
series of Merger Preferred Stock (collectively, the "Certificates of
Designations"), the issuance of such shares of Merger Preferred Stock in
accordance with the terms of the Merger Agreement be, and it hereby is,
authorized and, upon such issuance, such shares of Merger Preferred Stock shall
be validly issued, fully paid and nonassessable and free of preemptive rights;
and further
"RESOLVED, that the maximum number of shares of each series of
Merger Preferred Stock authorized to be so issued in connection with the Merger
shall be as follows: up to 5,600,000 shares upon conversion of Chase's Preferred
Stock, 10-1/2% Series G; up to 4,000,000 shares upon conversion of Chase's
Preferred Stock, 9.76% Series H; up to 8,000,000 shares upon conversion of
Chase's Preferred Stock, 10.84% Series I; up to 6,000,000 shares upon conversion
of Chase's Preferred Stock, 9.08% Series J; up to 6,800,000 shares upon
conversion of Chase's Preferred Stock, 8-1/2% Series K; up to 9,600,000 shares
upon conversion of Chase's Preferred Stock, 8.32% Series L; up to 6,900,000
shares upon conversion of Chase's Preferred Stock, 8.40% Series M; and up to
9,100,000 shares upon conversion of Chase's Preferred Stock, Adjustable Rate
Series N; and further
"RESOLVED, that the voting powers, preferences and special
rights of each series of Merger Preferred Stock shall be substantially identical
to the voting powers, preferences and special rights applicable to, and
specified in the certificate of designations with respect to, the respective
series of preferred stock of Chase to be converted into such series of Merger
Preferred Stock pursuant to the Merger; and further
"RESOLVED, that the Preferred Stock Committee of the Board of
Directors be, and it hereby is, authorized to approve, within the limits
specified in the foregoing resolutions, the form, terms and provisions of each
Certificate of Designations and to take such other actions as such committee
deems necessary or desirable to effect the issuance of the Merger Preferred
Stock in accordance with these resolutions."
4. The Board of Directors on October 17, 1995 adopted the
following resolutions fixing the voting rights of the Preferred Stock authorized
by the preceding resolutions:
"RESOLVED, that the Certificate of Designations for each
series of preferred stock, par value $1.00 per share (the "Preferred Stock"), of
the Corporation to be issued in connection with the merger of The Chase
Manhattan Corporation ("Chase") with and into the Corporation, upon the
conversion of the Preferred Stock, 10-1/2% Series G; Preferred Stock, 9.76%
Series H; Preferred Stock, 10.84% Series I; Preferred Stock, 9.08% Series J;
Preferred
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Stock, 8-1/2% Series K; Preferred Stock, 8.32% Series L; Preferred Stock, 8.40%
Series M; and Preferred Stock, Adjustable Rate Series N of Chase, shall be
modified to provide that the shares of such series shall not have any voting
powers either general or special, except that:
"If at the time of any annual meeting of the Corporation's
stockholders for the election of directors there is a default in
preference dividends on the Preferred Stock, the number of directors
constituting the Board of Directors of the Corporation shall be
increased by two, and the holders of the Preferred Stock of all series
(whether or not the holders of such series of Preferred Stock would be
entitled to vote for the election of directors if such default in
preference dividends did not exist), shall have the right at such
meeting, voting together as a single class without regard to series, to
the exclusion of the holders of common stock, par value $1.00 per
share, of the Corporation, to elect two directors of the Corporation to
fill such newly created directorships. Such right shall continue until
there are no dividends in arrears upon the Preferred Stock. Each
director elected by the holders of shares of Preferred Stock (a
"Preferred Director") shall continue to serve as such director for the
full term for which he shall have been elected, notwithstanding that
prior to the end of such term a default in preference dividends shall
cease to exist. Any Preferred Director may be removed by, and shall not
be removed except by, the vote of the holders of record of the
outstanding shares of Preferred Stock, voting together as a single
class without regard to series, at a meeting of the Corporation's
stockholders, or of the holders of shares of Preferred Stock, called
for the purpose. So long as a default in any preference dividends on
the Preferred Stock shall exist, (a) any vacancy in the office of a
Preferred Director may be filled (except as provided in the following
clause (b)) by an instrument in writing signed by the remaining
Preferred Director and filed with the Corporation and (b) in the case
of the removal of any Preferred Director, the vacancy may be filled by
the vote of the holders of the outstanding shares of Preferred Stock,
voting together as a single class without regard to series, at the same
meeting at which such removal shall be voted. Each director appointed
as aforesaid by the remaining Preferred Director shall be deemed, for
all purposes hereof, to be a Preferred Director. Whenever the term of
office of the Preferred Directors shall end and a default in preference
dividends shall no longer exist, the number of directors constituting
the Board of Directors of the Corporation shall be reduced by two. For
the purposes hereof, a "default in preference dividends" on the
Preferred Stock shall be deemed to have occurred whenever the amount of
accrued dividends upon any series of the Preferred Stock shall be
equivalent to six full quarter-yearly dividends or more, and, having so
occurred, such default shall be deemed to exist thereafter until, but
only until, all accrued dividends on all shares of Preferred Stock of
each and every series then outstanding shall have been paid to the end
of the last preceding dividend period; and
"Without the consent of the holders of shares entitled to cast
at least two-thirds of the votes entitled to be cast by the holders of
the total number of shares of Preferred Stock then outstanding, voting
as a class without regard to series, the holders of shares of this
series being entitled to cast one vote per share thereon, the
Corporation may not: (a) create any class or series of stock which
shall have preference as to dividends or distribution of assets over
any outstanding series of the Preferred Stock other than a series which
shall not have any right to object to such creation or (b) alter or
change the
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provisions of the Corporation's Certificate of Incorporation, as
amended, so as to adversely affect the voting power, preferences or
special rights of the holders of Preferred Stock; provided, however,
that if such creation or such alteration or change would adversely
affect the voting power, preferences or special rights of one or more,
but not all, series of Preferred Stock at the time outstanding, consent
of the holders of shares entitled to cast at least two-thirds of the
votes entitled to be cast by the holders of all of the shares of all
such series so affected, voting as a class, shall be required in lieu
of the consent of the holders of shares entitled to cast at least
two-thirds of the votes entitled to be cast by the holders of the total
number of shares of Preferred Stock at the time outstanding."
5. The Preferred Stock Committee of the Board of Directors on
March 19, 1996, pursuant to the authority conferred upon the Preferred Stock
Committee of the Board of Directors by Section 141(c) of the General Corporation
Law of the State of Delaware, by Section 3.03 of the By-Laws of the Corporation
and by the resolutions of the Board of Directors set forth above, adopted the
following resolution:
"RESOLVED, that pursuant to resolutions of the Board of Directors of
the Corporation adopted on August 27, 1995 and October 17, 1995, the issue of up
to Nine Million One Hundred Thousand (9,100,000) shares of Adjustable Rate
Cumulative Preferred Stock, Series N, $1.00 par value, of the Corporation is
hereby authorized, and the designation, preferences and privileges, relative,
participating, optional and other special rights, and qualifications,
limitations and restrictions of all 9,100,000 shares of this series, in addition
to those set forth in the Certificate of Incorporation of the Corporation and,
with respect to voting rights, in the resolutions of the Board of Directors of
the Corporation adopted on October 17, 1995, are hereby fixed as follows:
1. Designation. The designation of such series shall be
"Adjustable Rate Cumulative Preferred Stock, Series N" (hereinafter
referred to as the "Series N Preferred Stock") and the number of shares
constituting such series is Nine Million One Hundred Thousand
(9,100,000). Shares of Series N Preferred Stock shall have a stated
value of $25.00 per share. The number of authorized shares of Series N
Preferred Stock may be reduced by further resolution duly adopted by
the Board of Directors of the Corporation or any duly authorized
committee thereof and by the filing of a certificate pursuant to the
provisions of the General Corporation Law of the State of Delaware
stating that such reduction has been so authorized, but the number of
authorized shares of Series N Preferred Stock shall not be increased.
The Series N Preferred Stock shall rank on a parity as to dividends and
distributions of assets with the series of Preferred Stock, $1.00 par
value, of the Corporation designated as "10.96% Preferred Stock",
"8-3/8% Preferred Stock", "7.92% Cumulative Preferred Stock", "7.58%
Cumulative Preferred Stock", "7-1/2% Cumulative Preferred Stock",
"Adjustable Rate Cumulative Preferred Stock, Series L", "10-1/2%
Cumulative Preferred Stock", "9.76% Cumulative Preferred Stock",
"10.84% Cumulative Preferred Stock", "9.08% Cumulative Preferred
Stock", "8-1/2% Cumulative Preferred Stock", "8.32% Cumulative
Preferred Stock" and "8.40% Cumulative Preferred Stock".
2. Dividends. Dividends shall be payable on the shares of the
Series N Preferred Stock, when and as declared by the Board of
Directors, for the Initial Dividend
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Period (as defined below) and each quarterly dividend period (a
"Quarterly Dividend Period"; the Initial Dividend Period and each such
Quarterly Dividend Period being hereinafter referred to as "Dividend
Periods") thereafter, which Quarterly Dividend Periods shall commence
on January 1, April 1, July 1 and October 1 in each year, commencing
with the first such date to occur after the effective time of the
merger of The Chase Manhattan Corporation ("Chase") with and into the
Corporation (the "Effective Time"), and shall end on and include the
day next preceding the first day of the next Dividend Period, at a rate
per annum of the stated value thereof equal to the Applicable Rate (as
defined in Section 3) in respect of such Dividend Period, expressed as
a percentage to the nearest ten thousandth of a percentage point. The
amount of dividends per share for each Dividend Period shall be
computed by dividing the Applicable Rate for such Quarterly Dividend
Period by four and applying the resulting rate to the stated value per
share of the Series N Preferred Stock. The Initial Dividend Period is
the period commencing on the day following the most recent date next
preceding the Effective Time on which a dividend was paid on the
Preferred Stock, Adjustable Rate Series N, of Chase (the "Chase
Adjustable Rate Preferred")(or commencing on the date of the Effective
Time if such date was such a dividend payment date) and shall end on
and include the date next preceding the first day of the next Quarterly
Dividend Period; provided, however, that in the event the Effective
Time shall occur after the record date for the payment of a regular
quarterly dividend on the Chase Adjustable Rate Preferred but prior to
the payment date for such dividend, then the Initial Dividend Period
shall be the first Quarterly Dividend Period as described in the
preceding sentence. Dividends shall be cumulative from the date on
which the Initial Dividend Period commences and shall be payable, when
and as declared by the Board of Directors, on the last day of March,
June, September and December of each year, commencing with the last day
of the Initial Dividend Period. Each such dividend shall be paid to the
holders of record of shares of Series N Preferred Stock as they appear
on the stock register of the Corporation on such record date, not
exceeding 30 days preceding the payment date thereof, as shall be fixed
by the Board of Directors of the Corporation. Dividends on account of
arrears for any past dividend periods may be declared and paid at any
time, without reference to any quarterly dividend payment date, to
holders of record on such date, not exceeding 45 days preceding the
payment date thereof, as may be fixed by the Board of Directors of the
Corporation. In the event that there shall be outstanding shares of any
other series of Preferred Stock ranking on a parity as to dividends
with the Series N Preferred Stock, the Corporation, in making any
dividend payment on account of arrears on the Series N Preferred Stock
or such other series of Preferred Stock, shall make payments ratably
upon all outstanding shares of Series N Preferred Stock and such other
series of Preferred Stock in proportion to the respective amounts of
dividends in arrears upon all such outstanding shares of Series N
Preferred Stock and such other series of Preferred Stock to the date of
such dividend payment. No interest, or sum of money in lieu of
interest, shall be payable in respect of any dividend payment or
payments which may be in arrears. Dividends payable on the Series N
Preferred Stock for any period which is less than a full Quarterly
Dividend Period shall be computed on the basis of a 360 day year
consisting of twelve 30-day months.
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3. Definition of Applicable Rate, etc.
Except as provided below in this paragraph, the "Applicable
Rate" for the Initial Dividend Period (if it commences prior to the
date of the Effective Time) shall be the Applicable Rate of the Chase
Adjustable Rate Preferred immediately prior to the Effective Time, and
for any Quarterly Dividend Period (including the Initial Dividend
Period if it commences on or after the date of the Effective Time) will
be equal to 85% of the Effective Rate (as hereinafter defined). The
"Effective Rate" for any Quarterly Dividend Period will be equal to the
highest of the Treasury Bill Rate, the Ten Year Constant Maturity Rate
and the Thirty Year Constant Maturity Rate (each as hereinafter
defined) for such Dividend Period. In the event that the Corporation
determines in good faith that for any reason:
(i) any one of the Treasury Bill Rate, the Ten Year Constant
Maturity Rate or the Thirty Year Constant Maturity Rate cannot be
determined for any Quarterly Dividend Period, then the Effective Rate
for such Quarterly Dividend Period will be equal to the higher of
whichever two of such Rates can be so determined;
(ii) only one of the Treasury Bill Rate, the Ten Year Constant
Maturity Rate or the Thirty Year Constant Maturity Rate can be
determined for any Quarterly Dividend Period, then the Effective Rate
for such Quarterly Dividend Period will be equal to whichever such Rate
can be so determined; or
(iii) none of the Treasury Bill Rate, the Ten Year Constant
Maturity Rate or the Thirty Year Constant Maturity Rate can be
determined for any Quarterly Dividend Period, then the Effective Rate
for the preceding dividend period will be continued for such Quarterly
Dividend Period.
Anything herein to the contrary notwithstanding, the Applicable Rate
for any Quarterly Dividend Period shall in no event be less than 4.50%
per annum or greater than 10.50% per annum.
Except as described below in this paragraph, the "Treasury
Bill Rate" for each Quarterly Dividend Period will be the arithmetic
average of the two most recent weekly per annum market discount rates
(or the one weekly per annum market discount rate, if only one such
rate is published during the relevant Calendar Period (as hereinafter
defined)) for three-month U.S. Treasury bills, as published weekly by
the Federal Reserve Board (as hereinafter defined) during the Calendar
Period immediately preceding the last ten calendar days preceding the
Quarterly Dividend Period for which the dividend rate on the Series N
Preferred Stock is being determined. In the event that the Federal
Reserve Board does not publish such a weekly per annum market discount
rate during such Calendar Period, then the Treasury Bill Rate for such
Quarterly Dividend Period will be the arithmetic average of the two
most recent weekly per annum market discount rates (or the one weekly
per annum market discount rate, if only one such rate is published
during the relevant Calendar Period) for three-month U.S. Treasury
bills, as published weekly during such Calendar Period by any Federal
Reserve Bank or by any U.S. Government department or agency selected by
the Corporation. In the event that a
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per annum market discount rate for three-month U.S. Treasury bills is
not published by the Federal Reserve Board or by any Federal Reserve
Bank or by any U.S. Government department or agency during such
Calendar Period, then the Treasury Bill Rate for such Quarterly
Dividend Period will be the arithmetic average of the two most recent
weekly per annum market discount rates (or the one weekly per annum
market discount rate, if only one such rate is published during the
relevant Calendar Period) for all of the U.S. Treasury bills then
having remaining maturities of not less than 80 or more than 100 days,
as published during such Calendar Period by the Federal Reserve Board
or, if the Federal Reserve Board does not publish such rates, by any
Federal Reserve Bank or by any U.S. Government department or agency
selected by the Corporation. In the event that the Corporation
determines in good faith that for any reason no such U.S. Treasury bill
rates are published as provided above during such Calendar Period, then
the Treasury Bill Rate for such Quarterly Dividend Period will be the
arithmetic average of the per annum market discount rates based upon
the closing bids during such Calendar Period for each of the issues of
marketable non-interest-bearing U.S. Treasury securities with a
remaining maturity of not less than 80 nor more than 100 days from the
date of each such quotation, as chosen and quoted daily for each
business day in New York City (or less frequently if daily quotations
are not generally available) to the Corporation by at least three
recognized dealers in U.S. Government securities selected by the
Corporation. In the event that the Corporation determines in good faith
that for any reason the Corporation cannot determine the Treasury Bill
Rate for any Quarterly Dividend Period as provided above in this
paragraph, the Treasury Bill Rate for such Quarterly Dividend Period
will be the arithmetic average of the per annum market discount rates
based upon the closing bids during such Calendar Period for each of the
issues of marketable interest-bearing U.S. Treasury securities with a
remaining maturity of not less than 80 nor more than 100 days, as
chosen and quoted daily for each business day in New York City (or less
frequently if daily quotations are not generally available) to the
Corporation by at least three recognized dealers in U.S. Government
securities selected by the Corporation.
Except as described below in this paragraph, the "Ten Year
Constant Maturity Rate" for each Quarterly Dividend Period will be the
arithmetic average of the two most recent weekly per annum Ten Year
Average Yields (as hereinafter defined) (or the one weekly per annum
Ten Year Average Yield, if only one such yield is published during the
relevant Calendar Period), as published weekly by the Federal Reserve
Board during the Calendar Period immediately preceding the last ten
calendar days preceding the Quarterly Dividend Period for which the
dividend rate on the Series N Preferred Stock is being determined. In
the event that the Federal Reserve Board does not publish such a weekly
per annum Ten Year Average Yield during such Calendar Period, then the
Ten Year Constant Maturity Rate for such Quarterly Dividend Period will
be the arithmetic average of the two most recent weekly per annum Ten
Year Average Yields (or the one weekly per annum Ten Year Average
Yield, if only one such yield is published during the relevant Calendar
Period), as published weekly during such Calendar Period by any Federal
Reserve Bank or by any U.S. Government department or agency selected by
the Corporation. In the event that a per annum Ten Year Average Yield
is not published by the Federal Reserve Board or by any Federal Reserve
Bank or by any U.S. Government department or agency during such
Calendar Period, then the Ten Year Constant Maturity Rate for such
Quarterly Dividend Period will be the arithmetic average of the two
most
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recent weekly per annum average yields to maturity (or the one weekly
per annum average yield to maturity, if only one such yield is
published during the relevant Calendar Period) for all of the actively
traded marketable U.S. Treasury fixed interest rate securities (other
than Special Securities (as hereinafter defined)) then having remaining
maturities of not less than eight nor more than twelve years, as
published during such Calendar Period by the Federal Reserve Board or,
if the Federal Reserve Board does not publish such yields, by any
Federal Reserve Bank or by any U.S. Government department or agency
selected by the Corporation. In the event that the Corporation
determines in good faith that for any reason the Corporation cannot
determine the Ten Year Constant Maturity Rate for any Quarterly
Dividend Period as provided above in this paragraph, then the Ten Year
Constant Maturity Rate for such Quarterly Dividend Period will be the
arithmetic average of the per annum average yields to maturity based
upon the closing bids during such Calendar Period for each of the
issues of actively traded marketable U.S. Treasury fixed interest rate
securities (other than Special Securities) with a final maturity date
not less than eight nor more than twelve years from the date of each
such quotation, as chosen and quoted daily for each business day in New
York City (or less frequently if daily quotations are not generally
available) to the Corporation by at least three recognized dealers in
U.S. Government securities selected by the Corporation.
Except as described below in this paragraph, the "Thirty Year
Constant Maturity Rate" for each Quarterly Dividend Period will be the
arithmetic average of the two most recent weekly per annum Thirty Year
Average Yields (as hereinafter defined) (or the one weekly per annum
Thirty Year Average Yield, if only one such yield is published during
the relevant Calendar Period), as published weekly by the Federal
Reserve Board during the Calendar Period immediately preceding the last
ten calendar days preceding the Quarterly Dividend Period for which the
dividend rate on the Series N Preferred Stock is being determined. In
the event that the Federal Reserve Board does not publish such a weekly
per annum Thirty Year Average Yield during such Calendar Period, then
the Thirty Year Constant Maturity Rate for such Quarterly Dividend
Period will be the arithmetic average of the two most recent weekly per
annum Thirty Year Average Yields (or the one weekly per annum Thirty
Year Average Yield, if only one such yield is published during the
relevant Calendar Period), as published weekly during such Calendar
Period by any Federal Reserve Bank or by any U.S. Government department
or agency selected by the Corporation. In the event that a per annum
Thirty Year Average Yield is not published by the Federal Reserve Board
or by any Federal Reserve Bank or by any U.S. Government department or
agency during such Calendar Period, then the Thirty Year Constant
Maturity Rate for such Quarterly Dividend Period will be the arithmetic
average of the two most recent weekly per annum average yields to
maturity (or the one weekly per annum average yield to maturity, if
only one such yield is published during the relevant Calendar Period)
for all of the actively traded marketable U.S. Treasury fixed interest
rate securities (other than Special Securities) then having remaining
maturities of not less than twenty-eight nor more than thirty years, as
published during such Calendar Period by the Federal Reserve Board or,
if the Federal Reserve Board does not publish such yields, by any
Federal Reserve Bank or by any U.S. Government department or agency
selected by the Corporation. In the event that the Corporation
determines in good faith that for any reason the Corporation cannot
determine the Thirty Year Constant Maturity Rate for any Quarterly
Dividend Period as
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provided above in this paragraph, then the Thirty Year Constant
Maturity Rate for such Quarterly Dividend Period will be the arithmetic
average of the per annum average yields to maturity based upon the
closing bids during such Calendar Period for each of the issues of
actively traded marketable U.S. Treasury fixed interest rate securities
(other than Special Securities) with a final maturity date not less
than twenty-eight nor more than thirty years from the date of each such
quotation, as chosen and quoted daily for each business day in New York
City (or less frequently if daily quotations are not generally
available) to the Corporation by at least three recognized dealers in
U.S. Government securities selected by the Corporation.
The Treasury Bill Rate, the Ten Year Constant Maturity Rate
and the Thirty Year Constant Maturity Rate shall each be rounded to the
nearest five hundredths of a percent.
The Applicable Rate with respect to each Quarterly Dividend
Period will be calculated as promptly as practicable by the Corporation
according to the appropriate method described above. The Corporation
will cause each Applicable Rate to be published in a newspaper of
general circulation in New York City before the commencement of the
Quarterly Dividend Period to which it applies and will cause notice of
such Applicable Rate to be enclosed with the dividend payment checks
next mailed to the holders of Series N Preferred Stock.
For purposes of this Section,
(i) "Calendar Period" means a period of fourteen calendar
days;
(ii) "Federal Reserve Board" means the Board of Governors of
the Federal Reserve System;
(iii) "Special Securities" means securities which can, at the
option of the holder, be surrendered at face value in payment of any
Federal estate tax or which provide tax benefits to the holder and are
priced to reflect such tax benefits or which were originally issued at
a deep or substantial discount;
(iv) "Ten Year Average Yield" means the average yield to
maturity for actively traded marketable U.S. Treasury fixed interest
rate securities (adjusted to constant maturities of ten years); and
(v) "Thirty Year Average Yield" means the average yield to
maturity for actively traded marketable U.S. Treasury fixed interest
rate securities (adjusted to constant maturities of thirty years).
4. Redemption. On or after June 30, 1999, the Corporation, at
its option, may redeem shares of the Series N Preferred Stock, as a
whole or in part, at any time or from time to time at a redemption
price of $25 per share plus an amount equal to the accrued and unpaid
dividends thereon to the date fixed for redemption (whether or not such
dividends have been declared). To permit the Series N Preferred Stock
to qualify as Tier 1 capital of the Corporation, any such redemption
shall be subject to the prior approval of the Board of Governors of the
Federal Reserve System.
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In the event the Corporation shall redeem shares of Series N
Preferred Stock, notice of such redemption shall be given by first
class mail, postage prepaid, mailed not less than 30 nor more than 60
days prior to the redemption date, to each holder of record of the
shares to be redeemed, at such holder's address as the same appears on
the stock register of the Corporation. Each such notice shall state:
(1) the redemption date; (2) the number of shares of Series N Preferred
Stock to be redeemed and, if less than all the shares held by such
holder are to be redeemed, the number of such shares to be redeemed
from such holder; (3) the redemption price; (4) the place or places
where certificates for such shares are to be surrendered for payment of
the redemption price; and (5) that dividends on the shares to be
redeemed will cease to accrue on such redemption date. Notice having
been mailed as aforesaid, from and after the redemption date (unless
default shall be made by the Corporation in providing money for the
payment of the redemption price) dividends on the shares of the Series
N Preferred Stock so called for redemption shall cease to accrue, and
notwithstanding the fact that any certificates for such shares shall
not have been surrendered for payment of the redemption price, said
shares shall no longer be deemed to be outstanding, and all rights of
the holders thereof as stockholders of the Corporation (except the
right to receive from the Corporation the redemption price) shall
cease. Upon surrender in accordance with said notice of the
certificates for any shares so redeemed (properly endorsed or assigned
for transfer, if the Board of Directors of the Corporation or any duly
authorized committee thereof shall so require and the notice shall so
state), such shares shall be redeemed by the Corporation at the
redemption price aforesaid. If less than all the outstanding shares of
Series N Preferred Stock are to be redeemed, shares to be redeemed
shall be selected by the Corporation from outstanding shares of Series
N Preferred Stock not previously called for redemption by lot or pro
rata (as nearly as may be) or by any other method determined by the
Corporation in its sole discretion to be equitable.
In no event shall the Corporation redeem less than all the
outstanding shares of Series N Preferred Stock pursuant to the first
paragraph of this Section 4 or purchase or otherwise acquire any shares
of Series N Preferred Stock unless full cumulative dividends shall have
been paid or declared and set apart for payment upon all outstanding
shares of Series N Preferred Stock for all past Dividend Periods;
provided, however, that the foregoing shall not prevent the purchase or
acquisition of shares of Series N Preferred Stock pursuant to a
purchase or exchange offer made on the same terms to holders of all
outstanding shares of Series N Preferred Stock.
5. Shares to be Retired. All shares of Series N Preferred
Stock redeemed or purchased by the Corporation shall be retired and
cancelled and shall be restored to the status of authorized but
unissued shares of Preferred Stock, without designation as to series,
and may thereafter be issued, but not as shares of Series N Preferred
Stock.
6. Conversion or Exchange. The holders of shares of Series N
Preferred Stock shall not have any rights herein to convert such shares
into or exchange such shares for shares of any other class or classes
or of any other series of any class or classes of capital stock of the
Corporation.
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7. Voting. The shares of Series N Preferred Stock shall not
have any voting powers either general or special, except that:
If at the time of any annual meeting of the
Corporation's stockholders for the election of directors there
is a default in preference dividends on the Preferred Stock,
the number of directors constituting the Board of Directors of
the Corporation shall be increased by two, and the holders of
the Preferred Stock of all series (whether or not the holders
of such series of Preferred Stock would be entitled to vote
for the election of directors if such default in preference
dividends did not exist), shall have the right at such
meeting, voting together as a single class without regard to
series, to the exclusion of the holders of common stock, par
value $1.00 per share, of the Corporation, to elect two
directors of the Corporation to fill such newly created
directorships. Such right shall continue until there are no
dividends in arrears upon the Preferred Stock. Each director
elected by the holders of shares of Preferred Stock (a
"Preferred Director") shall continue to serve as such director
for the full term for which he shall have been elected,
notwithstanding that prior to the end of such term a default
in preference dividends shall cease to exist. Any Preferred
Director may be removed by, and shall not be removed except
by, the vote of the holders of record of the outstanding
shares of Preferred Stock, voting together as a single class
without regard to series, at a meeting of the Corporation's
stockholders, or of the holders of shares of Preferred Stock,
called for the purpose. So long as a default in any preference
dividends on the Preferred Stock shall exist, (a) any vacancy
in the office of a Preferred Director may be filled (except as
provided in the following clause (b)) by an instrument in
writing signed by the remaining Preferred Director and filed
with the Corporation and (b) in the case of the removal of any
Preferred Director, the vacancy may be filled by the vote of
the holders of the outstanding shares of Preferred Stock,
voting together as a single class without regard to series, at
the same meeting at which such removal shall be voted. Each
director appointed as aforesaid by the remaining Preferred
Director shall be deemed, for all purposes hereof, to be a
Preferred Director. Whenever the term of office of the
Preferred Directors shall end and a default in preference
dividends shall no longer exist, the number of directors
constituting the Board of Directors of the Corporation shall
be reduced by two. For the purposes hereof, a "default in
preference dividends" on the Preferred Stock shall be deemed
to have occurred whenever the amount of accrued dividends upon
any series of the Preferred Stock shall be equivalent to six
full quarter-yearly dividends or more, and, having so
occurred, such default shall be deemed to exist thereafter
until, but only until, all accrued dividends on all shares of
Preferred Stock of each and every series then outstanding
shall have been paid to the end of the last preceding dividend
period; and
Without the consent of the holders of shares entitled
to cast at least two-thirds of the votes entitled to be cast
by the holders of the total number of shares of Preferred
Stock then outstanding, voting as a class without regard to
series, the holders of shares of this series being entitled to
cast one vote per share thereon, the Corporation may not: (a)
create any class or series of stock which shall have
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preference as to dividends or distribution of assets over any
outstanding series of the Preferred Stock other than a series
which shall not have any right to object to such creation or
(b) alter or change the provisions of the Corporation's
Certificate of Incorporation, as amended, so as to adversely
affect the voting power, preferences or special rights of the
holders of Preferred Stock; provided, however, that if such
creation or such alteration or change would adversely affect
the voting power, preferences or special rights of one or
more, but not all, series of Preferred Stock at the time
outstanding, consent of the holders of shares entitled to cast
at least two-thirds of the votes entitled to be cast by the
holders of all of the shares of all such series so affected,
voting as a class, shall be required in lieu of the consent of
the holders of shares entitled to cast at least two-thirds of
the votes entitled to be cast by the holders of the total
number of shares of Preferred Stock at the time outstanding.
8. Liquidation Preference. In the event of any voluntary or
involuntary liquidation, dissolution or winding up of the Corporation,
the holders of the Series N Preferred Stock shall be entitled to
receive out of the assets of the Corporation available for distribution
to stockholders, before any distribution of assets shall be made to the
holders of Common Stock or of any other shares of stock of the
Corporation ranking as to such a distribution junior to the Series N
Preferred Stock, an amount equal to $25 per share plus an amount equal
to any accrued and unpaid dividends thereon to the date fixed for
payment of such distribution (whether or not such dividends have been
declared). If upon any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the amounts payable with
respect to the Series N Preferred Stock and any other shares of stock
of the Corporation ranking as to any such distribution on a parity with
the Series N Preferred Stock are not paid in full, the holders of the
Series N Preferred Stock and of such other shares shall share ratably
in any such distribution of assets of the Corporation in proportion to
the full respective preferential amounts to which they are entitled.
After payment to the holders of the Series N Preferred Stock of the
full preferential amounts provided for in this Section 8, the holders
of the Series N Preferred Stock shall be entitled to no further
participation in any distribution of assets by the Corporation. The
consolidation or merger of the Corporation with or into any other
corporation, or the sale of substantially all the assets of the
Corporation in consideration for the issuance of equity securities of
another corporation, shall not be regarded as a liquidation,
dissolution or winding up of the Corporation within the meaning of this
Section 8, but only if such consolidation, merger or sale of assets
shall not in any way impair the voting power, preferences or special
rights of the Series N Preferred Stock.
9. Limitation on Dividends on Junior Ranking Stock. So long as
any Series N Preferred Stock shall be outstanding, the Corporation
shall not declare any dividends on the Common Stock or any other stock
of the Corporation ranking as to dividends or distributions of assets
junior to the Series N Preferred Stock (the Common Stock and any such
other stock being herein referred to as "Junior Stock"), or make any
payment on account of, or set apart money for, a sinking or other
analogous fund for the purchase, redemption or other retirement of any
shares of Junior Stock, or make any distribution in respect thereof,
whether in cash or property or in obligations or stock of the
Corporation, other than Junior Stock (such dividends, payments, setting
apart and distributions being
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herein called "Junior Stock Payments"), unless all of the conditions
set forth in the following subsections A and B shall exist at the date
of such declaration in the case of any such dividend, or the date of
such setting apart in the case of any such fund, or the date of such
payment or distribution in the case of any other Junior Stock Payment:
A. Full cumulative dividends shall have been paid or
declared and set apart for payment upon all outstanding shares
of Preferred Stock other than Junior Stock.
B. The Corporation shall not be in default or in
arrears with respect to any sinking or other analogous fund or
any call for tenders obligation or other agreement for the
purchase, redemption or other retirement of any shares of
Preferred Stock other than Junior Stock."
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Appendix G
CERTIFICATE OF DESIGNATIONS
OF
FIXED/ADJUSTABLE RATE NONCUMULATIVE PREFERRED STOCK
OF
J.P. MORGAN CHASE & CO.
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
J.P. MORGAN CHASE & CO., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES
that the following resolutions were duly adopted by the Board of Directors of
the Corporation on January 20, 1998 and by the Stock Committee of the Board of
Directors on May 14, 1998, respectively, pursuant to authority conferred upon
the Board of Directors by the provisions of the Certificate of Incorporation of
the Corporation which authorize the issuance of up to 200,000,000 shares of
preferred stock of $1 par value per share (the "Preferred Stock"), and pursuant
to authority conferred upon the Stock Committee of the Board of Directors by
Section 141(c) of the General Corporation Law of the State of Delaware, by the
By-Laws of the Corporation and by the resolutions of the Board of Directors
adopted at a meeting duly convened and held on January 20, 1998:
1. The Board of Directors on January 20, 1998 adopted, among other resolutions,
the following resolutions authorizing a Stock Committee of the Board of
Directors to act on behalf of the Board of Directors in connection with the
issuance of the Preferred Stock and fixing the voting rights of the Preferred
Stock:
"RESOLVED that the Stock Committee may, from time to time
during the Stock Committee Term, authorize the issuance and sale of securities
which shall consist of any or all of the following: (i) one or more series of
the Corporation's preferred stock, $1 par value per share (the "Preferred
Stock"); (ii) depositary shares each representing a fraction of a share of
Preferred Stock or other security ("Depositary Shares"); (iii) warrants to
purchase any shares of Preferred Stock or Depositary Shares; (iv) warrants to
purchase shares of Common Stock; (v) any shares of Preferred Stock or Common
Stock or other securities into which or for which any of the foregoing may be
exchangeable, convertible, or issuable upon exercise, and (vi) any securities
(or units or combinations of securities) (including, without limitation, any
securities of an SPV (as defined below)) that the Corporation deems functionally
equivalent to Preferred Stock by reason of such securities (or units or
combinations of securities) counting as "Tier 1 capital" of the Corporation
according to the bank regulatory agencies (all of the foregoing hereinafter
collectively referred to as the "Preferred Shares" unless the context shall
otherwise require; and the Preferred Shares and Common Stock hereinafter
collectively referred to as "Securities", unless the context shall otherwise
require), for cash or other property, as shall be determined by the Stock
Committee, subject to the limitations hereinafter set forth, and any such
Preferred Shares may be sold through agents, through underwriters, through
dealers and directly to purchasers, in one or more offerings registered under
the Securities Act of 1933 (the "Act") or in transactions not required to be
registered under the Act, all as shall be determined by the Stock Committee; and
the Stock Committee shall have full authority to take any and all actions
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necessary to effect the intent of this resolution; and all Preferred Shares so
issued will be deemed duly authorized, validly issued, fully paid and
nonassessable;
RESOLVED that, without limiting the generality of the
preceding resolution, the Stock Committee is hereby expressly authorized during
the Stock Committee Term:
(i) to determine whether the Preferred Shares will be
issued in one or more series and the number of shares of any
such series;
(ii) to fix the dividend rate or rates of any such
shares and/or the methods of determining dividends and the
dates on which dividends shall be payable;
(iii) to determine whether dividends of any series of
Preferred Shares shall be cumulative or noncumulative and, if
cumulative, the dates from which dividends shall commence to
cumulate;
(iv) to determine the conversion or exchange
provisions, if any, of the shares of any series of the
Preferred Shares, including without limitation, the class and
series of capital stock or other securities of the Corporation
into which such shares shall be convertible or exchangeable;
(v) to determine whether the Corporation shall elect
to offer (a) warrants for such Preferred Shares ("Warrants")
or (b) Depositary Shares evidenced by depositary receipts,
each representing a fraction (to be determined by the Stock
Committee) of a share of a particular series of the Preferred
Stock or other securities, which shares of Preferred Stock or
other securities will be issued and deposited with a
depositary, in each case, in lieu of offering full shares of
such series of the Preferred Stock or other securities;
(vi) to fix the liquidation preference of the shares
of any series of the Preferred Shares, subject to the
limitation that the aggregate liquidation preference over
Common Stock of all the Preferred Shares issued during the
Stock Committee Term shall not exceed $1.0 billion (the
"Preferred Stock Maximum Amount");
(vii) to determine whether any warrants for Preferred
Stock, Depositary Shares or Common Stock shall be issued,
whether alone or in connection with any other Preferred
Shares, and the terms and conditions of any such warrants;
(viii) to determine whether the shares of any series
of the Preferred Shares shall be subject to redemption,
optional or mandatory or pursuant to a sinking fund, and, if
such series shall be subject to redemption, the redemption
provisions of such series; and
(ix) to fix or determine any additional dividend,
liquidation, redemption, sinking fund and other rights,
preferences, privileges, limitations and restrictions thereof;
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RESOLVED that, if required, for any series of Preferred Stock,
a certificate shall be prepared and filed on behalf of the Corporation with the
Secretary of State of the State of Delaware pursuant to Section 151 of the
General Corporation Law of the State of Delaware (a "Certificate of
Designation"); that each such Certificate of Designation be in such form as is
approved by action of the Board of Directors or the Stock Committee; and that
the proper officers of the Corporation be and hereby are authorized to execute
and file each such Certificate of Designation pursuant to the General
Corporation Law of the State of Delaware;
RESOLVED that the Certificate of Designation for each series
of the Preferred Stock shall provide that the shares of such series shall not
have any voting powers either general or special, except that
(i) if at the time of any annual meeting of the
Corporation's stockholders for the election of directors there
is a default in preference dividends on the Preferred Stock,
the number of directors constituting the Board of Directors of
the Corporation shall be increased by two, and the holders of
the Preferred Stock of all series (whether or not the holders
of such series of Preferred Stock would be entitled to vote
for the election of directors if such default in preference
dividends did not exist), shall have the right at such
meeting, voting together as a single class without regard to
series, to the exclusion of the holders of common stock, par
value $1 per share, of the Corporation, to elect two directors
of the Corporation to fill such newly created directorships.
Such right shall continue until there are no dividends in
arrears upon the Preferred Stock. Each director elected by the
holders of shares of Preferred Stock (a "Preferred Director")
shall continue to serve as such director for the full term for
which he or she shall have been elected, notwithstanding that
prior to the end of such term a default in preference
dividends shall cease to exist. Any Preferred Director may be
removed by, and shall not be removed except by, the vote of
the holders of record of the outstanding shares of Preferred
Stock, voting together as a single class without regard to
series, at a meeting of the Corporation's stockholders, or of
the holders of shares of Preferred Stock, called for the
purpose. So long as a default in any preference dividends on
the Preferred Stock shall exist, (a) any vacancy in the office
of a Preferred Director may be filled (except as provided in
the following clause (b)) by an instrument in writing signed
by the remaining Preferred Director and filed with the
Corporation and (b) in the case of the removal of any
Preferred Director, the vacancy may be filled by the vote of
the holders of the outstanding shares of Preferred Stock,
voting together as a single class without regard to series, at
the same meeting at which such removal shall be voted. Each
director appointed as aforesaid by the remaining Preferred
Director shall be deemed, for all purposes hereof, to be a
Preferred Director. Whenever the term of office of the
Preferred Directors shall end and a default in preference
dividends shall no longer exist, the number of directors
constituting the Board of Directors of the Corporation shall
be reduced by two. For the purposes hereof, a "default in
preference dividends" on the Preferred Stock shall be deemed
to have occurred whenever the amount of accrued dividends upon
any series of the Preferred Stock shall be equivalent to six
full quarter-yearly dividends or more, and, having so
occurred, such default shall be deemed to exist thereafter
until, but
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only until, all accrued dividends on all shares of Preferred
Stock of each and every series then outstanding shall have
been paid to the end of the last preceding dividend period.
(ii) Without the consent of the holders of shares
entitled to cast at least two-thirds of the votes entitled to
be cast by the holders of the total number of shares of
Preferred Stock then outstanding, voting as a class without
regard to series, the holders of shares of this series being
entitled to cast one vote per share thereon, the Corporation
may not: (a) create any class or series of stock which shall
have preference as to dividends or distribution of assets over
any outstanding series of the Preferred Stock other than a
series which shall not have any right to object to such
creation or (b) alter or change the provisions of the
Corporation's Certificate of Incorporation so as to adversely
affect the voting power, preferences or special rights of the
holders of Preferred Stock; provided, however, that if such
creation or such alteration or change would adversely affect
the voting power, preferences or special rights of one or
more, but not all, series of Preferred Stock at the time
outstanding, consent of the holders of shares entitled to cast
at least two-thirds of the votes entitled to be cast by the
holders of all of the shares of all such series so affected,
voting as a class, shall be required in lieu of the consent of
the holders of shares entitled to cast at least two-thirds of
the votes entitled to be cast by the holders of the total
number of shares of Preferred Stock at the time outstanding.
6. The Stock Committee of the Board of Directors on May 14,
1998, pursuant to the authority conferred upon the Stock Committee of the Board
of Directors by Section 141(c) of the General Corporation Law of the State of
Delaware, by Section 3.03 of the By-Laws of the Corporation and by the
resolutions of the Board of Directors set forth above, adopted the following
resolution:
"RESOLVED that, pursuant to resolutions of the Board of
Directors of J.P. Morgan Chase & Co. (the "Corporation") adopted on January 20,
1998, the issue of 4,000,000 shares of Fixed/Adjustable Rate Noncumulative
Preferred Stock, $50 stated value per share ($1 par value), of the Corporation
ranking on a parity with the series of Preferred Stock of the Corporation
designated as the Corporation's: 10.96% Preferred Stock; 7-1/2% Cumulative
Preferred Stock; Adjustable Rate Cumulative Preferred Stock, Series L; 10-1/2%
Cumulative Preferred Stock; 9.76% Cumulative Preferred Stock; 10.84% Cumulative
Preferred Stock; and Adjustable Rate Cumulative Preferred Stock, Series N, is
hereby authorized and the designation, preferences and privileges, relative,
participating, optional and other special rights, and qualifications,
limitations and restrictions of all 4,000,000 shares of this Series, in addition
to those set forth in the Restated Certificate of Incorporation of the
Corporation and, with respect to voting rights, in the resolutions of the Board
of Directors of the Corporation adopted on January 20, 1998, are hereby fixed as
follows:
1. Designation. The designation of this Series shall be
Fixed/Adjustable Rate Noncumulative Preferred Stock (hereinafter
referred to as this "Series"), and the number of shares constituting
this Series shall be 4,000,000. Shares of this Series shall have a
stated value of $50. The number of authorized shares of this Series may
be
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reduced by further resolution duly adopted by the Board of Directors of
the Corporation, the Stock Committee of the Board of Directors or by
any other duly authorized committee of the Board of Directors
(collectively, the "Board of Directors") and by the filing of a
certificate pursuant to the provisions of the General Corporation Law
of the State of Delaware stating that such reduction has been so
authorized, but the number of authorized shares of this Series shall
not be increased.
2. Dividends. (a) The holders of shares of this Series shall
be entitled to receive cash dividends, when, as and if declared by the
Board of Directors, out of funds legally available for that purpose, in
the amounts or at the rate set forth below in this Section 2. Dividends
on the shares of this Series shall be payable, when, as and if declared
by the Board of Directors, on March 31, June 30, September 30 and
December 31 of each year (each, a "Dividend Payment Date"), commencing
on September 30, 1998. Each such dividend shall be paid to the holders
of record of shares of this Series as they appear on the stock register
of the Corporation on such record date, not more than 45 days preceding
the payment date thereof, as shall be fixed by the Board of Directors.
Dividends on the shares of this Series shall not be cumulative and no
rights shall accrue to the holders of the shares of this Series if the
Corporation fails to declare a dividend on the shares of this Series
with respect to any Dividend Period (as hereinafter defined), whether
or not dividends are declared with respect to any future Dividend
Period.
(b) Dividends payable on the shares of this Series for the
period from May 21, 1998 through and including September 30, 1998 (the
"Initial Dividend Period") shall be $0.9024 per share. For each
quarterly dividend period after the Initial Dividend Period (each such
quarterly dividend period and the Initial Dividend Period being
hereinafter referred to individually as a "Dividend Period") through
and including the Dividend Period ending June 30, 2003, dividends
payable on the shares of this Series shall be payable at a rate per
annum of the stated value thereof equal to 4.96%. For each Dividend
Period beginning on or after July 1, 2003, dividends payable on the
shares of this Series shall be payable at a rate per annum of the
stated value thereof equal to the Applicable Rate (as defined in
Section 3) in respect of such Dividend Period, expressed as a
percentage to the nearest ten thousandth of a percentage point. The
amount of dividends per share for each Dividend Period shall be
computed by dividing the Applicable Rate for such Dividend Period by
four and applying the resulting rate to the stated value per share of
this Series. Each Dividend Period (other than the Initial Dividend
Period) shall commence on the January 1, April 1, July 1 and October 1,
as the case may be, following the last day of the Initial Dividend
Period or the preceding Dividend Period, as the case may be, and shall
end on and include the day next preceding the first day of the next
such Dividend Period.
(c) Dividends payable on this Series for any period greater or
less than a full Dividend Period, other than the Initial Dividend
Period, shall be computed on the basis of a 360-day year consisting of
twelve 30-day months and, for any period less than one month, the
actual number of days elapsed in the period.
(d) No full dividends shall be declared or paid or set apart
for payment on the Preferred Stock of any series ranking, as to
dividends, on a parity with or junior to this
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Series for any period unless full dividends on the shares of this
Series for the Dividend Period commencing on the day following the
immediately preceding Dividend Payment Date have been or
contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof set apart for such payment. When
dividends are not paid in full, as aforesaid, upon the shares of this
Series and any other series of Preferred Stock ranking on a parity as
to dividends with this Series, all dividends declared upon shares of
this Series and any other series of Preferred Stock ranking on a parity
as to dividends with this Series shall be declared pro rata so that the
amount of dividends declared per share on this Series and such other
Preferred Stock shall in all cases bear to each other the same ratio
that accrued and unpaid dividends per share (which in the case of this
Series shall include accrued and unpaid dividends for the Dividend
Period commencing on the day following the immediately preceding
Dividend Payment Date but shall not include accumulation of any
dividends for prior Dividend Periods, unless previously declared) on
the shares of this Series and such other Preferred Stock bear to each
other. No interest, or sum of money in lieu of interest, shall be
payable in respect of any dividend payment or payments on this Series
which may be in arrears.
(e) So long as any shares of this Series are outstanding, no
dividend (other than a dividend in Common Stock or in any other stock
ranking junior to this Series as to dividends and upon liquidation and
other than as provided in paragraph (d) of this Section 2) shall be
declared or paid or set aside for payment or other distribution
declared or made upon the Common Stock or upon any other stock ranking
junior to or on a parity with this Series as to dividends or upon
liquidation, nor shall any Common Stock or any other stock of the
Corporation ranking junior to or on a parity with this Series as to
dividends or upon liquidation be redeemed, purchased or otherwise
acquired for any consideration (or any moneys be paid to or made
available for a sinking fund for the redemption of any shares of any
such stock) by the Corporation (except by conversion into or exchange
for stock of the Corporation ranking junior to this Series as to
dividends and upon liquidation), unless, in each case, full dividends
on all outstanding shares of this Series shall have been paid or
declared and set aside for payment in respect of the Dividend Period
commencing on the day following the immediately preceding Dividend
Payment Date.
3. Definition of Applicable Rate, etc. (a) Except as provided
below in this paragraph, the "Applicable Rate" for any Dividend Period
beginning on or after July 1, 2003 shall be equal to the Effective Rate
(as hereinafter defined) less 0.20%. The "Effective Rate" for any
Dividend Period beginning on or after July 1, 2003 shall be equal to
the highest of the Treasury Bill Rate, the Ten Year Constant Maturity
Rate and the Thirty Year Constant Maturity Rate (each as hereinafter
defined) for such Dividend Period. In the event that the Corporation
determines in good faith that for any reason:
(i) any one of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Thirty Year Constant Maturity
Rate cannot be determined for any Dividend Period beginning on
or after July 1, 2003, then the Effective Rate for such
Dividend Period shall be equal to the higher of whichever two
of such rates can be so determined;
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(ii) only one of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Thirty Year Constant Maturity
Rate can be determined for any Dividend Period beginning on or
after July 1, 2003, then the Effective Rate for such Dividend
Period shall be equal to whichever such rate can be so
determined; or
(iii) none of the Treasury Bill Rate, the Ten Year
Constant Maturity Rate or the Thirty Year Constant Maturity
Rate can be determined for any Dividend Period beginning on or
after July 1, 2003, then the Effective Rate for the preceding
Dividend Period shall be continued for such Dividend Period.
Anything herein to the contrary notwithstanding, the
Applicable Rate for any Dividend Period shall in no event be less than 5.46% per
annum or greater than 11.46% per annum (without taking into account adjustments
described in paragraph 3(h) below).
(b) Except as described below in this paragraph, the "Treasury
Bill Rate" for each applicable Dividend Period shall be the arithmetic
average of the two most recent weekly per annum market discount rates
(or the one weekly per annum market discount rate, if only one such
rate is published during the relevant Calendar Period (as hereinafter
defined)) for three-month U.S. Treasury bills, as published weekly by
the Federal Reserve Board (as hereinafter defined) during the Calendar
Period immediately preceding the last ten calendar days preceding the
Dividend Period for which the dividend rate on this Series is being
determined. In the event that the Federal Reserve Board does not
publish such a weekly per annum market discount rate during such
Calendar Period, then the Treasury Bill Rate for such Dividend Period
shall be the arithmetic average of the two most recent weekly per annum
market discount rates (or the one weekly per annum market discount
rate, if only one such rate is published during the relevant Calendar
Period) for three-month U.S. Treasury bills, as published weekly during
such Calendar Period by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Corporation. In the
event that a per annum market discount rate for three-month U.S.
Treasury bills is not published by the Federal Reserve Board or by any
Federal Reserve Bank or by any U.S. Government department or agency
during such Calendar Period, then the Treasury Bill Rate for such
Dividend Period shall be the arithmetic average of the two most recent
weekly per annum market discount rates (or the one weekly per annum
market discount rate, if only one such rate is published during the
relevant Calendar Period) for all of the U.S. Treasury bills then
having remaining maturities of not less than 80 nor more than 100 days,
as published during such Calendar Period by the Federal Reserve Board
or, if the Federal Reserve Board does not publish such rates, by any
Federal Reserve Bank or by any U.S. Government department or agency
selected by the Corporation. In the event that the Corporation
determines in good faith that for any reason no such U.S. Treasury bill
rates are published as provided above during such Calendar Period, then
the Treasury Bill Rate for such Dividend Period shall be the arithmetic
average of the per annum market discount rates based upon the closing
bids during such Calendar Period for each of the issues of marketable
non-interest-bearing U.S. Treasury securities with a remaining maturity
of not less than 80 nor more than 100 days from the date of each such
quotation, as chosen and quoted daily for each business day in New York
City (or less frequently if daily quotations are not generally
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available) to the Corporation by at least three recognized dealers in
U.S. Government securities selected by the Corporation. In the event
that the Corporation determines in good faith that for any reason the
Corporation cannot determine the Treasury Bill Rate for any applicable
Dividend Period as provided above in this paragraph, the Treasury Bill
Rate for such Dividend Period shall be the arithmetic average of the
per annum market discount rates based upon the closing bids during such
Calendar Period for each of the issues of marketable interest-bearing
U.S. Treasury securities with a remaining maturity of not less than 80
nor more than 100 days, as chosen and quoted daily for each business
day in New York City (or less frequently if daily quotations are not
generally available) to the Corporation by at least three recognized
dealers in U.S. Government securities selected by the Corporation.
(c) Except as described below in this paragraph, the "Ten Year
Constant Maturity Rate" for each applicable Dividend Period shall be
the arithmetic average of the two most recent weekly per annum Ten Year
Average Yields (as hereinafter defined) (or the one weekly per annum
Ten Year Average Yield, if only one such yield is published during the
relevant Calendar Period), as published weekly by the Federal Reserve
Board during the Calendar Period immediately preceding the last ten
calendar days preceding the Dividend Period for which the dividend rate
on this Series is being determined. In the event that the Federal
Reserve Board does not publish such a weekly per annum Ten Year Average
Yield during such Calendar Period, then the Ten Year Constant Maturity
Rate for such Dividend Period shall be the arithmetic average of the
two most recent weekly per annum Ten Year Average Yields (or the one
weekly per annum Ten Year Average Yield, if only one such yield is
published during the relevant Calendar Period), as published weekly
during such Calendar Period by any Federal Reserve Bank or by any U.S.
Government department or agency selected by the Corporation. In the
event that a per annum Ten Year Average Yield is not published by the
Federal Reserve Board or by any Federal Reserve Bank or by any U.S.
Government department or agency during such Calendar Period, then the
Ten Year Constant Maturity Rate for such Dividend Period shall be the
arithmetic average of the two most recent weekly per annum average
yields to maturity (or the one weekly per annum average yield to
maturity, if only one such yield is published during the relevant
Calendar Period) for all of the actively traded marketable U.S.
Treasury fixed interest rate securities (other than Special Securities
(as hereinafter defined)) then having remaining maturities of not less
than eight nor more than twelve years, as published during such
Calendar Period by the Federal Reserve Board or, if the Federal Reserve
Board does not publish such yields, by any Federal Reserve Bank or by
any U.S. Government department or agency selected by the Corporation.
In the event that the Corporation determines in good faith that for any
reason the Corporation cannot determine the Ten Year Constant Maturity
Rate for any applicable Dividend Period as provided above in this
paragraph, then the Ten Year Constant Maturity Rate for such Dividend
Period shall be the arithmetic average of the per annum average yields
to maturity based upon the closing bids during such Calendar Period for
each of the issues of actively traded marketable U.S. Treasury fixed
interest rate securities (other than Special Securities) with a final
maturity date not less than eight nor more than twelve years from the
date of each such quotation, as chosen and quoted daily for each
business day in New York City (or less frequently if daily quotations
are
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not generally available) to the Corporation by at least three
recognized dealers in U.S. Government securities selected by the
Corporation.
(d) Except as described below in this paragraph, the "Thirty
Year Constant Maturity Rate" for each applicable Dividend Period shall
be the arithmetic average of the two most recent weekly per annum
Thirty Year Average Yields (as hereinafter defined) (or the one weekly
per annum Thirty Year Average yield, if only one such yield is
published during the relevant Calendar Period), as published weekly by
the Federal Reserve Board during the Calendar Period immediately
preceding the last ten calendar days preceding the Dividend Period for
which the dividend rate on this Series is being determined. In the
event that the Federal Reserve Board does not publish such a weekly per
annum Thirty Year Average Yield during such Calendar Period, then the
Thirty Year Constant Maturity Rate for such Dividend Period shall be
the arithmetic average of the two most recent weekly per annum Thirty
Year Average Yields (or the one weekly per annum Thirty Year Average
Yield, if only one such yield is published during the relevant Calendar
Period), as published weekly during such Calendar Period by any Federal
Reserve Bank or by any U.S. Government department or agency selected by
the Corporation. In the event that a per annum Thirty Year Average
Yield is not published by the Federal Reserve Board or by any Federal
Reserve Bank or by any U.S. Government department or agency during such
Calendar Period, then the Thirty Year Constant Maturity Rate for such
Dividend Period shall be the arithmetic average of the two most recent
weekly per annum average yields to maturity (or the one weekly per
annum average yield to maturity, if only one such yield is published
during the relevant Calendar Period) for all of the actively traded
marketable U.S. Treasury fixed interest rate securities (other than
Special Securities) then having remaining maturities of not less than
twenty-eight nor more than thirty years, as published during such
Calendar Period by the Federal Reserve Board or, if the Federal Reserve
Board does not publish such yields, by any Federal Reserve Bank or by
any U.S. Government department or agency selected by the Corporation.
In the event that the Corporation determines in good faith that for any
reason the Corporation cannot determine the Thirty Year Constant
Maturity for any applicable Dividend Period as provided above in this
paragraph, the Thirty Year Constant Maturity Rate for such Dividend
Period shall be the arithmetic average of the per annum average yields
to maturity based upon the closing bids during such Calendar Period for
each of the issues of actively traded marketable U.S. Treasury fixed
interest rate securities (other than Special Securities) with a final
maturity date not less than twenty-eight nor more than thirty years
from the date of each such quotation, as chosen and quoted daily for
each business day in New York City (or less frequently if daily
quotations are not generally available) to the Corporation by at least
three recognized dealers in U.S. Government securities selected by the
Corporation.
(e) The Treasury Bill Rate, the Ten Year Constant Maturity
Rate and the Thirty Year Constant Maturity Rate shall each be rounded
to the nearest five hundredths of a percent.
(f) The Applicable Rate with respect to each Dividend Period
beginning on or after July 1, 2003 shall be calculated as promptly as
practicable by the Corporation
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according to the appropriate method described above. The Corporation
shall cause notice of each Applicable Rate to be sent to the holders of
this Series.
(g) For purposes of this Section,
(i) "Calendar Period" means a period of fourteen
calendar days;
(ii) "Federal Reserve Board" means the Board of
Governors of the Federal Reserve System;
(iii) "Special Securities" means securities which
can, at the option of the holder, be surrendered at face value
in payment of any Federal estate tax or which provide tax
benefits to the holder and are priced to reflect such tax
benefits or which were originally issued at a deep or
substantial discount;
(iv) "Ten Year Average Yield" means the average yield
to maturity for actively traded marketable U.S. Treasury fixed
interest rate securities (adjusted to constant maturities of
ten years); and
(v) "Thirty Year Average Yield" means the average
yield to maturity for actively traded marketable U.S. Treasury
fixed interest rate securities (adjusted to constant
maturities of thirty years).
(h) If, prior to November 21, 1999, one or more amendments to
the Internal Revenue Code of 1986, as amended (the "Code"), are enacted
that reduce the percentage of the dividends-received deduction
(currently 70%) as specified in section 243(a)(1) of the Code or any
successor provision (the "Dividends-Received Percentage"), the amount
of each dividend payable (if declared) per share of this Series for
dividend payments made on or after the effective date of such change in
the Code shall be adjusted by multiplying the amount of the dividend
payable described above (before adjustment) by the following fraction
(the "DRD Formula"), and rounding the result to the nearest cent (with
one-half cent rounded up):
1- [.35(1-.70)]
---------------
1- [.35(1-DRP)]
For the purposes of the DRD Formula, "DRP" means the Dividends-Received
Percentage (expressed as a decimal) applicable to the dividend in question;
provided, however, that if the Dividends-Received Percentage applicable to the
dividend in question shall be less than 50%, then the DRP shall equal 0.50.
Notwithstanding the foregoing provisions, if, with respect to any such
amendment, the Corporation receives either an unqualified opinion of nationally
recognized independent tax counsel selected by the Corporation or a private
letter ruling or similar form of authorization from the Internal Revenue Service
("IRS") to the effect that such amendment does not apply to a dividend payable
on this Series, then such amendment shall not result in the adjustment provided
for pursuant to the DRD Formula with respect to such dividend. Such opinion
shall be based upon the legislation amending or establishing the DRP or upon a
published pronouncement of the IRS addressing such legislation.
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If any such amendment to the Code is enacted after the
dividend payable on a Dividend Payment Date has been declared, the amount of the
dividend payable on such Dividend Payment Date shall not be increased; instead,
additional dividends (the "Post Declaration Date Dividends") equal to the
excess, if any, of (x) the product of the dividend paid by the Corporation on
such Dividend Payment Date and the DRD Formula (where the DRP used in the DRD
Formula would be equal to the greater of the Dividends-Received Percentage and
0.50) applicable to the dividend in question over (y) the dividend paid by the
Corporation on such Dividend Payment Date, shall be payable (if declared) to
holders of shares of this Series on the record date applicable to the next
succeeding Dividend Payment Date or, if the shares of this Series are called for
redemption prior to such record date, to holders of shares of this Series on the
applicable redemption date, as the case may be, in addition to any other amounts
payable on such date. Notwithstanding the foregoing provisions, if, with respect
to any such amendment, the Corporation receives either an unqualified opinion of
nationally recognized independent tax counsel selected by the Corporation or a
private letter ruling or similar form of authorization from the IRS to the
effect that such amendment does not apply to a dividend so payable on this
Series, then such amendment shall not result in the payment of Post Declaration
Date Dividends. The opinion referenced in the previous sentence shall be based
upon the legislation amending or establishing the DRP or upon a published
pronouncement of the IRS addressing such legislation.
If any such amendment to the Code is enacted and the reduction
in the Dividends-Received Percentage retroactively applies to a Dividend Payment
Date as to which the Corporation previously paid dividends on this Series (each,
an "Affected Dividend Payment Date"), the Corporation shall pay (if declared)
additional dividends (the "Retroactive Dividends") to holders of shares of this
Series on the record date applicable to the next succeeding Dividend Payment
Date (or, if such amendment is enacted after the dividend payable on such
Dividend Payment Date has been declared, to holders of shares of this Series on
the record date following the date of enactment) or, if the shares of this
Series are called for redemption prior to such record date, to holders of shares
of this Series on the applicable redemption date, as the case may be, in an
amount equal to the excess of (x) the product of the dividend paid by the
Corporation on each Affected Dividend Payment Date and the DRD Formula (where
the DRP used in the DRD Formula would be equal to the greater of the
Dividends-Received Percentage and 0.50) applied to each Affected Dividend
Payment Date over (y) the sum of the dividends paid by the Corporation on each
Affected Dividend Payment Date. The Corporation shall only make one payment of
Retroactive Dividends for any such amendment. Notwithstanding the foregoing
provisions, if, with respect to any such amendment, the Corporation receives
either an unqualified opinion of nationally recognized independent tax counsel
selected by the Corporation or a private letter ruling or similar form of
authorization from the IRS to the effect that such amendment does not apply to a
dividend so payable on this Series, then such amendment shall not result in the
payment of Retroactive Dividends. The opinion referenced in the previous
sentence shall be based upon the legislation amending or establishing the DRP or
upon a published pronouncement of the IRS addressing such legislation.
Notwithstanding the foregoing, no adjustment in the dividends
payable by the Corporation shall be made, and no Post Declaration Date Dividends
or Retroactive Dividends shall be payable by the Corporation, in respect of the
enactment of any amendment to the Code at any time on or after November 21, 1999
that reduces the Dividends-Received Percentage.
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In the event that the amount of dividends payable per share of
the shares of this Series is adjusted pursuant to the DRD Formula and/or Post
Declaration Date Dividends or Retroactive Dividends are to be paid, the
Corporation shall give notice of each such adjustment and, if applicable, any
Post Declaration Date Dividends and Retroactive Dividends to the holders of
shares of this Series.
3. Redemption. (a) Except as provided in paragraph (b) below,
the shares of this Series are not redeemable prior to June 30, 2003.
The Corporation, at its option, may redeem shares of this Series, as a
whole or in part, at any time or from time to time, on or after June
30, 2003 at a redemption price of $50 per share plus accrued and unpaid
dividends thereon (whether or not declared and including any increase
in dividends pursuant to paragraph 3(h) above) from the immediately
preceding Dividend Payment Date to the date fixed for redemption (but
without any accumulation for unpaid dividends for prior Dividend
Periods on the shares of this Series).
(b) If the Dividends-Received Percentage is equal to or less
than 50% and, as a result, the amount of dividends payable on this
Series on any Dividend Payment Date shall be or is adjusted upwards as
described in paragraph 3(h) above, the Company, at its option, may
redeem all, but not less than all, of the outstanding shares of this
Series, provided that within sixty days of the date on which an
amendment to the Code is enacted which reduces the Dividends-Received
Percentage to 50% or less, the Company sends notice to holders of
shares of this Series of such redemption in accordance with paragraph
(d) below. Any redemption of this Series in accordance with this
paragraph shall be on notice as aforesaid at a redemption price equal
to $51 per share, plus accrued and unpaid dividends (whether or not
declared and including any increase in dividends pursuant to paragraph
3(h) above) from the immediately preceding Dividend Payment Date to the
date fixed for redemption (but without any accumulation for unpaid
dividends for prior Dividend Periods on the shares of this Series).
(c) In the event that fewer than all the outstanding shares of
this Series are to be redeemed, the number of shares to be redeemed
shall be determined by the Board of Directors and the shares to be
redeemed shall be determined by lot or pro rata as may be determined by
the Board of Directors or by any other method as may be determined by
the Board of Directors in its sole discretion to be equitable, provided
that such method satisfies any applicable requirements of any
securities exchange on which this Series is listed.
(d) In the event the Corporation shall redeem shares of this
Series, notice of such redemption shall be given by first class mail,
postage prepaid, mailed not less than 30 or more than 60 days prior to
the redemption date, to each holder of record of the shares to be
redeemed, at such holder's address as the same appears on the stock
register of the Corporation. Each such notice shall state: (i) the
redemption date; (ii) the number of shares of this Series to be
redeemed and, if fewer than all the shares held by such holder are to
be redeemed, the number of such shares to be redeemed from such holder;
(iii) the redemption price; (iv) the place or places where certificates
for such shares are to be surrendered for payment of the redemption
price; and (v) that dividends on the shares to be redeemed shall cease
to accrue on the redemption date.
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(e) Notice having been mailed as aforesaid, from and after the
redemption date (unless default shall be made by the Corporation in
providing money for the payment of the redemption price) dividends on
the shares of this Series so called for redemption shall cease to
accrue, and said shares shall no longer be deemed to be outstanding,
and all rights of the holders thereof as stockholders of the
Corporation (except the right to receive from the Corporation the
redemption price) shall cease. Upon surrender in accordance with said
notice of the certificates for any shares so redeemed (properly
endorsed or assigned for transfer, if the Board of Directors shall so
require and the notice shall so state), such shares shall be redeemed
by the Corporation at the redemption price aforesaid. In case fewer
than all the shares represented by any such certificate are redeemed, a
new certificate shall be issued representing the unredeemed shares
without cost to the holder thereof.
(f) Any shares of this Series which shall at any time have
been redeemed shall, after such redemption, have the status of
authorized but unissued shares of Preferred Stock, without designation
as to series until such shares are once more designated as part of a
particular series by the Board of Directors.
(g) Notwithstanding the foregoing provisions of this Section
4, if full dividends on all outstanding shares of this Series are in
arrears, no shares of this Series shall be redeemed unless all
outstanding shares of this Series are simultaneously redeemed, and the
Corporation shall not purchase or otherwise acquire any shares of this
Series; provided, however, that the foregoing shall not prevent the
purchase or acquisition of shares of this Series pursuant to a purchase
or exchange offer made on the same terms to holders of all outstanding
shares of this Series.
5. Conversion. The holders of shares of this Series shall not
have any rights to convert such shares into shares of any other class
or series of capital stock of the Corporation.
6. Liquidation Rights. (a) Upon the voluntary or involuntary
dissolution, liquidation or winding up of the Corporation, the holders
of the shares of this Series shall be entitled to receive and to be
paid out of the assets of the Corporation available for distribution to
its stockholders, before any payment or distribution shall be made on
the Common Stock or on any other class of stock ranking junior to this
Series upon liquidation, the amount of $50 per share, plus accrued and
unpaid dividends (whether or not declared and including any increase in
dividends pursuant to paragraph 3(h) above) from the immediately
preceding Dividend Payment Date or the date of original issuance of
this Series, as the case may be, to the date of the liquidating
distribution (but without any accumulation of unpaid dividends for
prior Dividend Periods).
(b) After the payment to the holders of the shares of this
Series of the full preferential amounts provided for in this Section 6,
the holders of this Series as such shall have no right or claim to any
of the remaining assets of the Corporation.
(c) If, upon any voluntary or involuntary dissolution,
liquidation, or winding up of the Corporation, the amounts payable with
respect to the shares of this Series and
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any other shares of stock of the Corporation ranking as to any such
distribution on a parity with the shares of this Series are not paid in
full, the holders of the shares of this Series and of such other shares
shall share ratably in any such distribution of assets of the
Corporation in proportion to the full respective distributions to which
they are entitled.
(d) Neither the sale of all or substantially all the property
or business of the Corporation, nor the merger or consolidation of the
Corporation into or with any other corporation or the merger or
consolidation of any other corporation into or with the Corporation,
shall be deemed to be a dissolution, liquidation or winding up,
voluntary or involuntary, for the purposes of this Section 6.
7. Ranking. For purposes of this resolution, any stock of any
class or classes of the Corporation shall be deemed to rank:
(a) prior to the shares of this Series, either as to dividends
or upon liquidation, if the holders of such class or classes shall be
entitled to the receipt of dividends or of amounts distributable upon
dissolution, liquidation or winding up of the Corporation, as the case
may be, in preference or priority to the holders of shares of this
Series;
(b) on a parity with shares of this Series, either as to
dividends or upon liquidation, whether or not the dividend rates,
dividend payment dates or redemption or liquidation prices per share or
sinking fund provisions, if any, be different from those of this Series
(and whether or not such dividends shall accumulate), if the holders of
such stock shall be entitled to the receipt of dividends or of amounts
distributable upon dissolution, liquidation or winding up of the
Corporation, as the case may be, without preference or priority, one
over the other, as between the holders of such stock and the holders of
shares of this Series; and
(c) junior to shares of this Series, either as to dividends or
upon liquidation, if such class shall be Common Stock or if the holders
of shares of this Series shall be entitled to receipt of dividends or
of amounts distributable upon dissolution, liquidation or winding up of
the Corporation, as the case may be, in preference or priority to the
holders of shares of such class or classes.
8. Voting Rights. The shares of this Series shall have the
voting rights set forth in the resolutions of the Board of Directors of
the Corporation adopted on January 20, 1998."
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