PROSPECTUS Dated March 26, 1998 Pricing Supplement No. 40 to
PROSPECTUS SUPPLEMENT Registration Statement No. 333-46935
Dated April 6, 1998 Dated August 14, 1998
Rule 424(b)(3)
$6,509,370
Morgan Stanley Dean Witter & Co.
MEDIUM-TERM NOTES, SERIES E
Senior Fixed Rate Notes
9.70% REVERSE EXCHANGEABLE NOTES DUE AUGUST 28, 2000
Exchangeable at the Option of the Company for Shares of Common Stock of
The Chase Manhattan Corporation
The 9.70% Reverse Exchangeable Notes due August 28, 2000 (the
"Notes"), are Medium-Term Notes, Series E (Senior Fixed Rate Notes) of Morgan
Stanley Dean Witter & Co. (the "Company"), as further described below and
in the Prospectus Supplement under "Description of Notes--Fixed Rate
Notes"and "--Exchangeable Notes." The Notes will bear interest at the rate
of 9.70% per annum (the "Stated Coupon Rate") payable annually on August 28
of each year (each an "Interest Payment Date"), commencing August 28, 1999.
The Notes are issued in minimum denominations of $2,919 ("Par") and will
mature on August 28, 2000. The Notes will not be redeemable at the option
of the Company prior to the Maturity Date other than under the
circumstances described under "Description of Notes-Tax Redemption" in the
accompanying Prospectus Supplement.
The Notes will be issued only in bearer form, which form is
further described under "Description of Notes--Forms, Denominations, Exchange
and Transfer" in the accompanying Prospectus Supplement. Notes in bearer form
will not be exchangeable at any time for Notes in registered form.
At maturity, the Company may redeem the Notes, in whole but not
in part, either by paying the par amount of each Note in cash or by exchanging
each $2,919 principal amount of such Note for 50 shares (the "Exchange Ratio")
of the common stock, par value $1.00 per share ("Chase Stock"), of The Chase
Manhattan Corporation ("Chase"). The Exchange Ratio will be adjusted for
certain corporate events. See "Adjustments to Exchange Ratio" in this Pricing
Supplement. If the Company elects to deliver Chase Stock at maturity, the
value of the Chase Stock received by a holder of a Note at maturity,
determined as described herein, will be less than the principal amount of such
Note.
Chase is neither affiliated with the Company nor involved in
this offering of the Notes. The closing price on the New York Stock Exchange
of the Chase Stock on the date of this Pricing Supplement was $64 7/8 (the
"Initial Market Price"). See "Historical Information" in this Pricing
Supplement for information on the range of market prices for Chase Stock.
The Company will cause any adjustments to the Exchange Ratio to
be determined by the Calculation Agent for The Chase Manhattan Bank as Trustee
under the Senior Debt Indenture.
An investment in the Notes entails risks not associated with
similar investments in a conventional debt security, as described under " Risk
Factors" on PS-4 and PS-5 herein.
------------------------
PRICE $2,919 PER NOTE(1)
------------------------
MORGAN STANLEY DEAN WITTER
- ------------
(1) Plus accrued interest, if any, from August 28, 1998.
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS THAT
STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF CHASE STOCK.
SPECIFICALLY, THE AGENT MAY OVERALLOT IN CONNECTION WITH THE OFFERING, AND MAY
BID FOR, AND PURCHASE CHASE STOCK IN THE OPEN MARKET. FOR A DESCRIPTION OF
THESE ACTIVITIES, SEE "USE OF PROCEEDS AND HEDGING" AND "SUPPLEMENTAL
INFORMATION CONCERNING PLAN OF DISTRIBUTION."
Capitalized terms not defined herein have the meanings given to such terms in
the accompanying Prospectus Supplement.
Principal Amount.............. $6,509,370
Maturity Date................. August 28, 2000
Stated Coupon Rate............ 9.70% per annum
Interest Payment Dates........ Each August 28, commencing August 28, 1999
Specified Currency............ U.S. Dollars
Issue Price................... $2,919
Original Issue Date
(Settlement Date)............. August 28, 1998
Common Code................... 9028382
ISIN.......................... XS0090283820
Initial Market Price.......... $64(7)/(8), the closing price on the New York
Stock Exchange of Chase Stock on the date of
this Pricing Supplement.
Clearing Systems.............. The Notes will be deposited with a common
depositary for the Euroclear Operator and
Cedel Bank, for credit to the account
designated by or on behalf of the subscribers
thereof.
Senior Note or Subordinated
Note.......................... Senior
Minimum Denominations......... $2,919 and integral multiples thereof
Agent......................... Morgan Stanley & Co. International Limited
Trustee....................... The Chase Manhattan Bank (London Branch)
Payment at Maturity .......... At maturity, the Company may redeem the
Notes, in whole but not in part, either by
paying the par amount of each Note in cash or
by exchanging each $2,919 principal amount of
such Note for 50 shares (the "Exchange
Ratio") of Chase Stock. If the Company
elects to deliver shares of Chase Stock, it
will, or will cause the Calculation Agent to,
notify the Trustee, the Euroclear Operator
and Cedel Bank of such election on or prior
to 4:00 p.m. (Brussels time) on the Company
Notice Date. The Company will, or will cause
the Calculation Agent to, deliver such shares
of Chase Stock to the Trustee for delivery to
the holders. References to payment "per
Note" refer to each $2,919 principal amount
of any Note.
Company Notice Date........... August 22, 2000
No Fractional Shares ......... If at maturity the Company chooses to deliver
shares of Chase Stock, the Company will pay
cash in lieu of delivering fractional shares
of Chase Stock in an amount equal to the
corresponding fractional Market Price of
Chase Stock, as determined by the Calculation
Agent on the Company Notice Date.
Exchange Ratio................ 50, subject to adjustment for certain
corporate events. See "Adjustments to
Exchange Ratio" below.
Market Price.................. If Chase Stock (or any other security for
which a Market Price must be determined) is
listed on a national securities exchange, is a
security of The Nasdaq National Market
("NASDAQ NMS") or is included in the OTC
Bulletin Board Service ("OTC Bulletin Board")
operated by the National Association of
Securities Dealers, Inc. (the "NASD"), the
Market Price for one share of Chase Stock (or
one unit of any such other security) on any
NYSE Trading Day means (i) the first reported
sale price, regular way, on such day on the
principal United States securities exchange
registered under the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), on
which Chase Stock (or any other such
security) is listed or admitted to trading or
(ii) if not listed or admitted to trading on
any such securities exchange or if such first
reported sale price is not obtainable, the
first reported sale price on the
over-the-counter market as reported on the
NASDAQ NMS or OTC Bulletin Board on such day.
If the first reported sale price is not
available pursuant to clause (i) or (ii) of
the preceding sentence, the Market Price for
any NYSE Trading Day shall be the mean, as
determined by the Calculation Agent, of the
bid prices for Chase Stock (or any such other
security) obtained from as many dealers in
such security, but not exceeding three, as
will make such bid prices available to the
Calculation Agent. The term "NASDAQ NMS
security" shall include a security included
in any successor to such system and the term
"OTC Bulletin Board Service" shall include
any successor service thereto.
NYSE Trading Day.............. A day on which trading is generally conducted
in the over-the-counter market for equity
securities in the United States and on the
New York Stock Exchange, as determined by
the Calculation Agent, and on which a
Market Disruption Event (as defined below)
has not occurred.
Business Day.................. Any day, other than a Saturday or a Sunday,
that is neither a legal holiday nor a day on
which banking institutions are authorized or
required by law or regulation to close in The
City of New York or The City of London.
Calculation Agent............. Morgan Stanley & Co. International Limited
("MSIL")
Because the Calculation Agent is an affiliate
of the Company, potential conflicts of
interest may exist between the Calculation
Agent and the holders of the Notes, including
with respect to certain determinations and
judgments that the Calculation Agent must make
in making adjustments to the Exchange Ratio
or determining the Market Price or whether a
Market Disruption Event has occurred. See
"Adjustment to the Exchange Ratio" and
"Market Disruption Event" below. MSIL is
obligated to carry out its duties and
functions as Calculation Agent in good faith
and using its reasonable judgment.
Risk Factors.................. An investment in the Notes entails
significant risks not associated with similar
investments in a conventional debt security,
including the following:
If the Company chooses to redeem the Notes by
delivering Chase Stock, the market value of
the Chase Stock delivered to a holder will
be less than the principal amount of such
Notes and an investment in the Notes would
likely result in a loss.
There can be no assurance as to how the Notes
will trade in the secondary market or whether
such market will be liquid or illiquid. The
market value for the Notes will be affected
by a number of factors independent of the
creditworthiness of the Company and the value
of Chase Stock, including, but not limited
to, the volatility of Chase Stock, the
dividend rate on Chase Stock, market interest
and yield rates and the time remaining to the
maturity of the Notes. In addition, the
value of Chase Stock depends on a number of
interrelated factors, including economic,
financial and political events, over which
the Company has no control. The market value
of the Notes is expected to depend primarily
on market interest and yield rates and the
extent of the depreciation, if any, of the
Market Price of Chase Stock below the Initial
Market Price. The price at which a holder
will be able to sell Notes prior to maturity
may be at a discount, which could be
substantial, from the accreted principal
amount thereof, if, at such time, the Market
Price of Chase Stock is below the Initial
Market Price. The historical market prices
of Chase Stock should not be taken as an
indication of Chase Stock's future
performance during the term of any Note.
The Company is not affiliated with Chase and,
although the Company as of the date of this
Pricing Supplement does not have any material
non-public information concerning Chase,
corporate events of Chase, including those
described below in "Adjustments to the
Exchange Ratio," are beyond the Company's
ability to control and are difficult to
predict.
Chase is not involved in the offering of the
Notes and has no obligations with respect to
the Notes, including any obligation to take
the interests of the Company or of holders of
Notes into consideration for any reason.
Chase will not receive any of the proceeds of
the offering of the Notes made hereby and is
not responsible for, and has not participated
in, the determination of the timing of,
prices for or quantities of, the Notes
offered hereby.
Because the Calculation Agent is an affiliate
of the Company, potential conflicts of
interest may exist between the Calculation
Agent and the holders of the Notes, including
with respect to certain adjustments to the
Exchange Ratio that may influence the amount
of Chase Stock received by investors if the
Company elects to deliver Chase Stock at
maturity. See "Adjustments to the Exchange
Ratio" and "Market Disruption Event."
It is suggested that prospective investors
who consider purchasing the Notes should
reach an investment decision only after
carefully considering the suitability of the
Notes in light of their particular
circumstances.
Investors should also consider the tax
consequences of investing in the Notes. See
"United States Federal Taxation" below.
Adjustments to the
Exchange Ratio................. The Exchange Ratio will be adjusted through
the NYSE Trading Day preceding the Company
Notice Date as follows:
1. If Chase Stock is subject to a stock split
or reverse stock split, then once such split
has become effective, the Exchange Ratio will
be adjusted to equal the product of the prior
Exchange Ratio and the number of shares
issued in such stock split or reverse stock
split with respect to one share of Chase
Stock.
2. If Chase Stock is subject to a stock
dividend (issuance of additional shares of
Chase Stock that is given ratably to all
holders of shares of Chase Stock), then once
the dividend has become effective and Chase
Stock is trading ex-dividend, the Exchange
Ratio will be adjusted so that the new
Exchange Ratio shall equal the prior Exchange
Ratio plus the product of (i) the number of
shares issued with respect to one share of
Chase Stock and (ii) the prior Exchange Ratio.
3. There will be no adjustments to the
Exchange Ratio to reflect cash dividends or
other distributions paid with respect to Chase
Stock other than distributions described in
paragraph 6 below and Extraordinary Dividends
as described below. A cash dividend or other
distribution with respect to Chase Stock will
be deemed to be an "Extraordinary Dividend"
if such dividend or other distribution
exceeds the immediately preceding
non-Extraordinary Dividend for Chase Stock by
an amount equal to at least 10% of the Market
Price of Chase Stock on the NYSE Trading Day
preceding the ex-dividend date for the
payment of such Extraordinary Dividend (the
"ex-dividend date"). If an Extraordinary
Dividend occurs with respect to Chase
Stock, the Exchange Ratio with respect to
Chase Stock will be adjusted on the ex-
dividend date with respect to such
Extraordinary Dividend so that the new
Exchange Ratio will equal the product of
(i) the then current Exchange Ratio and
(ii) a fraction, the numerator of which is
the Market Price on the NYSE Trading Day
preceding the ex-dividend date, and the
denominator of which is the amount by
which the Market Price on the NYSE Trading
Day preceding the ex-dividend date exceeds
the Extraordinary Dividend Amount. The
"Extraordinary Dividend Amount" with
respect to an Extraordinary Dividend for
Chase Stock will equal (i) in the case of
cash dividends or other distributions that
constitute quarterly dividends, the amount
per share of such Extraordinary Dividend
minus the amount per share of the
immediately preceding non-Extraordinary
Dividend for Chase Stock or (ii) in the
case of cash dividends or other
distributions that do not constitute
quarterly dividends, the amount per share
of such Extraordinary Dividend. To the
extent an Extraordinary Dividend is not
paid in cash, the value of the non-cash
component will be determined by the
Calculation Agent, whose determination
shall be conclusive. A distribution on
the Chase Stock described in paragraph 5
below that also constitutes an
Extraordinary Dividend shall only cause an
adjustment to the Exchange Ratio pursuant
to paragraph 5.
4. If Chase issues rights or warrants to all
holders of Chase Stock to subscribe for or
purchase Chase Stock at an exercise price per
share less than the Market Price of the Chase
Stock on both (i) the date the exercise price
of such rights or warrants is determined and
(ii) the expiration date of such rights or
warrants, and if the expiration date of such
rights or warrants precedes the maturity of
the Notes, then the Exchange Ratio will be
adjusted to equal the product of the prior
Exchange Ratio and a fraction, the numerator
of which shall be the number of shares of
Chase Stock outstanding immediately prior to
the issuance of such rights or warrants plus
the number of additional shares of Chase
Stock offered for subscription or purchase
pursuant to such rights or warrants and the
denominator of which shall be the number of
shares of Chase Stock outstanding immediately
prior to the issuance of such rights or
warrants plus the number of additional shares
of Chase Stock which the aggregate offering
price of the total number of shares of Chase
Stock so offered for subscription or purchase
pursuant to such rights or warrants would
purchase at the Market Price on the
expiration date of such rights or warrants,
which shall be determined by multiplying such
total number of shares offered by the
exercise price of such rights or warrants and
dividing the product so obtained by such
Market Price.
5. If (i) there occurs any reclassification
of Chase Stock, (ii) Chase or any surviving
entity or subsequent surviving entity of
Chase (a "Chase Successor") has been subject
to a merger, combination or consolidation and
is not the surviving entity, (iii) any
statutory exchange of securities of Chase or
any Chase Successor with another corporation
occurs (other than pursuant to clause (ii)
above), (iv) Chase is liquidated, (v) Chase
issues to all of its shareholders equity
securities of an issuer other than Chase
(other than in a transaction described in
clauses (ii), (iii) or (iv) above) (a
"Spin-off Event") or (vi) a tender or
exchange offer is consummated for all the
outstanding shares of Chase Stock (any such
event in clauses (i) through (vi) a
"Reorganization Event"), the method of
determining the amount payable upon exchange
at maturity for each Note if the Company
elects to deliver shares of Chase Stock will
be adjusted to provide that each holder of
Notes will receive at maturity, in respect
of each $2,919 principal amount of each Note,
securities, cash or any other assets
distributed in any such Reorganization Event,
including, in the case of a Spin-off Event,
the share of Chase Stock with respect to
which the spun-off security was issued
(collectively, the "Exchange Property") in an
amount with a value equal to (a) if the
Exchange Ratio has not been adjusted prior to
maturity, the Transaction Value or (b) if the
Exchange Ratio has been adjusted, an amount
equal to the product of the final Exchange
Ratio and the Transaction Value. If Exchange
Property consists of more than one type of
property, holders of Notes will receive at
maturity a pro rata share of each such type
of Exchange Property. "Transaction Value"
at any date means (i) for any cash received
in any such Reorganization Event, the amount
of cash received per share of Chase Stock,
(ii) for any property other than cash or
securities received in any such
Reorganization Event, the market value, as
determined by the Calculation Agent, as of
the date of receipt, of such Exchange
Property received for each share of Chase
Stock and (iii) for any security received in
any such Reorganization Event, an amount
equal to the Market Price, as of the date on
which the Transaction Value is determined,
per share of such security multiplied by the
quantity of such security received for each
share of Chase Stock. The Transaction Value
will be calculated on the Company Notice Date.
6. If more than one of the events set out
above occurs, the adjustments to the Exchange
Ratio for the second and subsequent events
shall be to the Exchange Ratio as adjusted
for preceding events.
For purposes of paragraph 5 above, in the
case of a consummated tender or exchange
offer for all Exchange Property of a
particular type, Exchange Property shall be
deemed to include the amount of cash or other
property paid by the offeror in the tender or
exchange offer with respect to such Exchange
Property (in an amount determined on the
basis of the rate of exchange in such tender
or exchange offer). In the event of a tender
or exchange offer with respect to Exchange
Property in which an offeree may elect to
receive cash or other property, Exchange
Property shall be deemed to include the kind
and amount of cash and other property received
by offerees who elect to receive cash.
No adjustments to the Exchange Ratio will be
required unless such adjustment would require
a change of at least 0.1% in the Exchange
Factor then in effect. The Exchange Ratio
resulting from any of the adjustments
specified above will be rounded to the
nearest one hundred-thousandth with five
one-millionths being rounded upward.
No adjustments to the Exchange Factor or
method of calculating the Exchange Ratio will
be made other than those specified above. The
adjustments specified above do not cover all
events that could affect the Market Price of
the Chase Stock, including, without
limitation, a partial tender or exchange
offer for the Chase Stock.
The Calculation Agent shall be solely
responsible for the determination and
calculation of any adjustments to the Exchange
Ratio and of any related determinations and
calculations with respect to any
distributions of stock, other securities or
other property or assets (including cash) in
connection with any corporate event described
in paragraph 5 above, and its determinations
and calculations with respect thereto shall
be conclusive.
The Calculation Agent will provide
information as to any adjustments to the
Exchange Ratio upon written request by any
holder of the Notes.
Market Disruption Event....... "Market Disruption Event" means, with respect
to Chase Stock:
(i) a suspension, absence or material
limitation of trading of Chase Stock on
the primary market for Chase Stock for more
than two hours of trading or during the
one-half hour period preceding the close
of trading in such market; or the
suspension, absence or material limitation
on the primary market for trading in
options contracts related to Chase Stock,
if available, during the one-half hour
period preceding the close of trading in
the applicable market, in each case as
determined by the Calculation Agent in its
sole discretion; and
(ii) a determination by the Calculation
Agent in its sole discretion that the
event described in clause (i) above
materially interfered with the ability of
the Company or any of its affiliates to
unwind all or a material portion of the
hedge with respect to the Notes.
For purposes of determining whether a Market
Disruption Event has occurred: (1) a
limitation on the hours or number of days of
trading will not constitute a Market
Disruption Event if it results from an
announced change in the regular business
hours of the relevant exchange, (2) a
decision to permanently discontinue trading
in the relevant contract will not constitute
a Market Disruption Event, (3) limitations
pursuant to New York Stock Exchange Rule 80A
(or any applicable rule or regulation enacted
or promulgated by the New York Stock
Exchange, any other self-regulatory
organization or the Securities and Exchange
Commission of similar scope as determined by
the Calculation Agent) on trading during
significant market fluctuations will
constitute a suspension or material
limitation of trading, (4) a suspension of
trading in an options contract on Chase Stock
by the primary securities market trading in
such options, if available, by reason of (x)
a price change exceeding limits set by such
securities exchange or market, (y) an
imbalance of orders relating to such
contracts or (z) a disparity in bid and ask
quotes relating to such contracts will
constitute a suspension or material
limitation of trading in options contracts
related to Chase Stock and (5) a "suspension,
absence or material limitation of trading" on
the primary securities market on which
options contracts related to Chase Stock are
traded will not include any time when such
securities market is itself closed for
trading under ordinary circumstances.
Alternate Exchange
Calculation in case
of an Event of Default........ In case an Event of Default with respect to
the Notes shall have occurred and be
continuing, the amount declared due and
payable upon any acceleration of any Note
shall be determined by MSIL, as Calculation
Agent, and shall be equal to the Issue Price
of a Note plus any accrued interest at the
Interest Rate to but not including the date
of acceleration.
Chase Stock;
Public Information............ Chase is a bank holding company registered
under the Bank Holding Company Act of 1956,
as amended. Chase conducts its domestic and
international financial services businesses
through various bank and non-bank
subsidiaries. Chase Stock is registered
under the Exchange Act. Companies with
securities registered under the Exchange Act
are required to file periodically certain
financial and other information specified by
the Securities and Exchange Commission (the
"Commission"). Information provided to or
filed with the Commission can be inspected
and copied at the public reference facilities
maintained by the Commission at Room 1024,
450 Fifth Street, N.W., Washington, D.C.
20549 or at its Regional Offices located at
Suite 1400, Citicorp Center, 500 West Madison
Street, Chicago, Illinois 60661 and at Seven
World Trade Center, 13th Floor, New York, New
York 10048, and copies of such material can
be obtained from the Public Reference Section
of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates.
In addition, information provided to or filed
with the Commission electronically can be
accessed through a Website maintained by the
Commission. The address of the Commission's
Website is http:/www.sec.gov. Information
provided to or filed with the Commission by
Chase pursuant to the Exchange Act of 1934 can
be located by reference to Commission file
number 1-5805. In addition, information
regarding Chase may be obtained from other
sources including, but not limited to, press
releases, newspaper articles and other
publicly disseminated documents. The Company
makes no representation or warranty as to the
accuracy or completeness of such reports.
THIS PRICING SUPPLEMENT RELATES ONLY TO THE
NOTES OFFERED HEREBY AND DOES NOT RELATE TO
CHASE STOCK OR OTHER SECURITIES OF CHASE. ALL
DISCLOSURES CONTAINED IN THIS PRICING
SUPPLEMENT REGARDING CHASE ARE DERIVED FROM
THE PUBLICLY AVAILABLE DOCUMENTS DESCRIBED IN
THE PRECEDING PARAGRAPH. NEITHER THE COMPANY
NOR THE AGENT HAS PARTICIPATED IN THE
PREPARATION OF SUCH DOCUMENTS OR MADE ANY DUE
DILIGENCE INQUIRY WITH RESPECT TO CHASE IN
CONNECTION WITH THE OFFERING OF THE NOTES.
NEITHER THE COMPANY NOR THE AGENT MAKES ANY
REPRESENTATION THAT SUCH PUBLICLY AVAILABLE
DOCUMENTS OR ANY OTHER PUBLICLY AVAILABLE
INFORMATION REGARDING CHASE ARE ACCURATE OR
COMPLETE. FURTHERMORE, THERE CAN BE NO
ASSURANCE THAT ALL EVENTS OCCURRING PRIOR TO
THE DATE HEREOF (INCLUDING EVENTS THAT WOULD
AFFECT THE ACCURACY OR COMPLETENESS OF THE
PUBLICLY AVAILABLE DOCUMENTS DESCRIBED IN THE
PRECEDING PARAGRAPH) THAT WOULD AFFECT THE
TRADING PRICE OF CHASE STOCK (AND THEREFORE
THE INITIAL MARKET PRICE AND THE EXCHANGE
RATIO) HAVE BEEN PUBLICLY DISCLOSED.
SUBSEQUENT DISCLOSURE OF ANY SUCH EVENTS OR
THE DISCLOSURE OF OR FAILURE TO DISCLOSE
MATERIAL FUTURE EVENTS CONCERNING CHASE COULD
AFFECT THE VALUE RECEIVED ON ANY EXCHANGE
DATE OR CALL DATE WITH RESPECT TO THE NOTES
AND THEREFORE THE TRADING PRICES OF THE NOTES.
NEITHER THE COMPANY NOR ANY OF ITS AFFILIATES
MAKES ANY REPRESENTATION TO ANY PURCHASER OF
NOTES AS TO THE PERFORMANCE OF CHASE STOCK.
The Company or its affiliates may presently
or from time to time engage in business with
Chase including extending loans to, or making
equity investments in, Chase or providing
advisory services to Chase, including merger
and acquisition advisory services. In the
course of such business, the Company or its
affiliates may acquire non-public information
with respect to Chase and, in addition, one
or more affiliates of the Company may publish
research reports with respect to Chase. The
statement in the preceding sentence is not
intended to affect the rights of holders of
the Notes under the securities laws. Any
prospective purchaser of a Note should
undertake an independent investigation of
Chase as in its judgment is appropriate to
make an informed decision with respect to an
investment in Chase Stock.
Historical Information........ The following table sets forth the high and
low closing price on the New York Stock
Exchange of Chase Stock during 1995, 1996,
1997 and during 1998 through August 14, 1998.
The closing price on the New York Stock
Exchange of Chase Stock on August 14, 1998 was
$64(7)/(8). The closing prices on the New
York Stock Exchange of Chase Stock listed
below were obtained from Bloomberg Financial
Markets. The Company believes all such
information to be accurate. The historical
prices of Chase Stock should not be taken as
an indication of future performance, and no
assurance can be given that the price of
Chase Stock will increase sufficiently to
cause the beneficial owners of the Notes to
receive an amount in excess of the principal
amount on any Exchange Date or Call Date.
Dividends
Chase High Low per Share
----- ---- --- ---------
(CUSIP # 16161A108)
1995
First Quarter.......... 20 3/16 18 1/8 $0.22
Second Quarter......... 24 3/16 19 1/16 0.22
Third Quarter.......... 30 1/2 23 1/2 0.25
Fourth Quarter......... 32 1/16 28 1/8 0.25
1996
First Quarter.......... 36 3/8 27 1/16 0.28
Second Quarter......... 37 1/8 32 1/2 0.28
Third Quarter.......... 40 5/16 32 15/16 0.28
Fourth Quarter......... 47 11/16 40 1/4 0.28
1997
First Quarter.......... 54 13/16 43 3/8 0.31
Second Quarter......... 51 1/2 42 11/16 0.31
Third Quarter.......... 59 7/32 49 3/4 0.31
Fourth Quarter......... 63 3/16 51 13/16 0.31
1998
First Quarter.......... 69 1/16 50 15/16 0.36
Second Quarter......... 75 5/8 66 5/16 0.36
Third Quarter (through
August 14, 1998)....... 77 64 7/8
Historical prices have been adjusted for a 2
for 1 stock split of Chase Stock, which
became effective in the second quarter of
1998.
The Company makes no representation as to the
amount of dividends, if any, that Chase will
pay in the future. In any event, holders of
the Notes will not be entitled to receive
dividends, if any, that may be payable on
Chase Stock.
Use of Proceeds and Hedging... The net proceeds to be received by the
Company from the sale of the Notes will be
used for general corporate purposes and, in
part, by the Company or one or more of its
affiliates in connection with hedging the
Company's obligations under the Notes. See
also "Use of Proceeds" in the accompanying
Prospectus.
On or prior to the date of this Pricing
Supplement, the Company, through its
subsidiaries, hedged its anticipated exposure
in connection with the Notes by taking
positions in options contracts on Chase Stock
listed on major securities markets and
positions in other instruments that it deemed
appropriate in connection with such hedging.
The Company, through its subsidiaries, is
likely to modify its hedge position
throughout the life of the Notes by
purchasing and selling Chase Stock, options
contracts on Chase Stock listed on major
securities markets or positions in any other
instruments that it may wish to use in
connection with such hedging. Although the
Company has no reason to believe that its
hedging activity will have a material impact
on the price of Chase Stock, there can be no
assurance that the Company will not affect
the price of Chase Stock as a result of its
hedging activities.
Supplemental Information
Concerning Plan of
Distribution.................. The Agent will pay the initial purchaser of
the Notes a placement fee at settlement equal
to 1.06% of the Issue Price.
United States Federal
Taxation...................... See "United States Federal Taxation" in the
accompanying Prospectus Supplement for the
principal United States federal income and
estate tax consequences of ownership and
disposition of the Notes.
