Morgan Stanley 8-K, filed Oct 2, 2020
Morgan Stanley (MS)
About this 8-K
Morgan Stanley filed this 8-K on October 2, 2020.
Items reported
- Item 2.01: Completed an acquisition or sale of assets
- Item 3.03: Change to shareholders' rights
- Item 5.02: Director or officer change, or executive pay
- Item 5.03: Charter or bylaw amendment, or fiscal year change
- Item 7.01: Regulation FD disclosure
- Item 8.01: Other events
- Item 9.01: Financial statements and exhibits
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (date of earliest event
reported):
(Exact name of registrant as specified in its charter)
Commission File Number:
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| (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |
(Address of principal executive offices, including zip code)
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(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Depositary Shares, each representing 1/1,000th interest in a share of Floating Rate |
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Depositary Shares, each representing 1/1,000th interest in a shre of Fixed-to-Floating Rate |
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Depositary Shares, each representing 1/1,000th interest in a share of Fixed-to-Floating Rate |
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Depositary Shares, each representing 1/1,000th interest in a shre of Fixed-to-Floating Rate |
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Depositary Shares, each representing 1/1,000th interest in a shre of Fixed-to-Floating Rate |
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Depositary Shares, each representing 1/1,000th interest in a sare of 4.875% |
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of Morgan Stanley Finance LLC (and Registrant’s guarantee with respect thereto) |
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the
Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Introductory Note
This Current Report on Form 8-K is being filed in connection with the consummation on October 2, 2020 (the “Closing Date”) of the previously announced transactions contemplated by the Agreement and Plan of Merger, dated as of February 20, 2020 (the “Merger Agreement”), by and among Morgan Stanley, a Delaware corporation (“Morgan Stanley”), E*TRADE Financial Corporation, a Delaware corporation (“E*TRADE”) and Moon-Eagle Merger Sub, Inc., a Delaware corporation and a wholly owned subsidiary of Morgan Stanley (“Merger Sub”).
On the Closing Date, pursuant to the Merger Agreement, Merger Sub merged with and into E*TRADE, with E*TRADE continuing as the surviving corporation (the “Merger” and the surviving corporation, the “Surviving Corporation”). Pursuant to the Merger Agreement, immediately following the effective time of the Merger (the “Effective Time”), E*TRADE merged with and into Moon-Eagle Merger Sub II, LLC, a newly established wholly owned subsidiary of Morgan Stanley (“Second Merger Sub”), with Second Merger Sub continuing as the surviving entity with the name “E*TRADE Financial, LLC” (the “Second Merger” and, together with the Merger, the “Mergers”).
Item 2.01. Completion of Acquisition or Disposition of Assets.
The information set forth in the Introductory Note of this Current Report on Form 8-K is incorporated herein by reference.
Pursuant to the Merger Agreement, at the Effective Time, each outstanding share of E*TRADE common stock, par value $0.01 per share (the “E*TRADE Common Stock”), issued and outstanding immediately prior to the Effective Time (other than shares of E*TRADE common stock held (1) in treasury and (2) by Morgan Stanley (other than any such shares held by Morgan Stanley (i) in its fiduciary, representative or other capacity on behalf of other persons, (ii) as a result of debts previously contracted by it, (iii) in its capacity as an underwriter or market-maker or in connection with its proprietary trading or arbitrage activities or other similar activities in the ordinary course of business, (iv) in the context of its ordinary course brokerage (including prime brokerage), asset management, private banking, wealth management, research or similar activities or (v) in connection with its transactions that are undertaken by pension funds or employee benefit programs), which were cancelled at the Effective Time) were converted into the right to receive 1.0432 shares of Morgan Stanley common stock, par value $0.01 per share (together with the cash payments in lieu of fractional shares referred to in the following sentence, such consideration, the “Common Share Consideration”). No fractional shares of Morgan Stanley common stock were issued and each former E*TRADE stockholder who would otherwise have been entitled to receive a fraction of a share of Morgan Stanley common stock in connection with the Merger is entitled to receive in lieu thereof a cash payment (together with the Common Share Consideration, the “Common Merger Consideration”), without interest and subject to any applicable withholding taxes, in accordance with the Merger Agreement.
Pursuant to the Merger Agreement, at the Effective Time, each outstanding E*TRADE restricted stock unit award that was eligible to vest solely based on continued service, restricted stock unit award that was eligible to vest based on the achievement of performance goals, restricted stock award made to directors of E*TRADE and deferred restricted stock unit award made to directors of E*TRADE vested (if unvested) and was cancelled and converted into the right to receive the Common Merger Consideration as if such award (including any shares of E*TRADE common stock in respect of dividend equivalent units credited thereon) had been settled in shares of E*TRADE common stock immediately prior to the Effective Time. In the case of restricted stock unit awards that were eligible to vest based on the achievement of performance goals, (i) with respect to any performance periods that are completed on or before the Effective Time, each such award vested at the greater of the target or actual level of performance, as determined by the Compensation Committee of E*TRADE’s board of directors prior to the Effective Time and (ii) with respect to any performance periods that are not completed on or before the Effective Time, each such award vested at the target level of performance.
Pursuant to the Merger Agreement, at the Effective Time, each share of E*TRADE’s Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series A, par value $0.01 per share (the “E*TRADE Series A Preferred Stock”), outstanding immediately before the Effective Time was converted into the right to receive one share of Morgan Stanley Series M Preferred Stock (as defined in Item 5.03 below) with such rights, preferences, privileges and voting powers, and limitations and restrictions, that, taken as a whole, are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers of the E*TRADE Series A Preferred Stock, taken as a whole. Additionally, pursuant to the Merger Agreement and at the Effective Time, each share of E*TRADE’s Fixed-to Floating Rate Non-Cumulative Perpetual Preferred Stock, Series B, par value $0.01 per share (the “E*TRADE Series B Preferred Stock”), outstanding immediately before the Effective Time was converted into the right to receive one share of Morgan Stanley Series N Preferred Stock (as defined in Item 5.03 below) with such rights, preferences, privileges and voting powers, and limitations and restrictions, that, taken as a whole, are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers of the E*TRADE Series B Preferred Stock, taken as a whole.
The foregoing description of the Mergers and the Merger Agreement does not purport to be a complete description and is qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which is attached as Exhibit 2.1 to Morgan Stanley’s Current Report on Form 8-K filed with the Securities and Exchange Commission (“SEC”) on February 21, 2020, Commission File Number 1-11758, and which is incorporated herein by reference.
Item 3.03. Material Modification to Rights of Security Holders.
The information set forth in the Introductory Note and Item 2.01 of this Current Report on Form 8-K is incorporated herein by reference.
Upon issuance of the Morgan Stanley Series M Preferred Stock and the Morgan Stanley Series N Preferred Stock (each as defined in Item 5.03 below) on October 2, 2020, the ability of Morgan Stanley (the “Registrant”) to (i) declare or pay dividends or distributions on, or purchase, redeem or otherwise acquire for consideration, shares of its junior stock and (ii) purchase, redeem or otherwise acquire for consideration, shares of its parity stock will be subject to certain restrictions in the event that the Registrant fails to declare and pay full dividends on its Morgan Stanley Series M Preferred Stock or Morgan Stanley Series N Preferred Stock. “Junior stock” means (i) with respect to the Morgan Stanley Series M Preferred Stock, any class or series of capital stock of the Registrant that ranks junior to the Morgan Stanley Series M Preferred Stock as to the payment of dividends and the distribution of assets upon liquidation, dissolution or winding up of the Registrant and (ii) with respect to the Morgan Stanley Series N Preferred Stock, any class or series of capital stock of the Registrant that ranks junior to the Morgan Stanley Series N Preferred Stock as to the payment of dividends and the distribution of assets upon liquidation, dissolution or winding up of the Registrant. For both the Morgan Stanley Series M Preferred Stock and the Morgan Stanley Series N Preferred Stock, junior stock includes the Registrant’s common stock. “Parity stock” means (i) with respect to the Morgan Stanley Series M Preferred Stock, any other class or series of stock of the Registrant that ranks equally with the Morgan Stanley Series M Preferred Stock in the payment of dividends, whether cumulative or non-cumulative, and the distribution of assets upon liquidation, dissolution or winding up of the Registrant and (ii) with respect to the Morgan Stanley Series N Preferred Stock, any other class or series of stock of the Registrant that ranks equally with the Morgan Stanley Series N Preferred Stock in the payment of dividends, whether cumulative or non-cumulative, and the distribution of assets upon liquidation, dissolution or winding up of the Registrant. These restrictions are set forth in the Certificate of Designation establishing the terms of the Morgan Stanley Series M Preferred Stock and the Certificate of Designation establishing the terms of the Morgan Stanley Series N Preferred Stock, copies of which are filed as Exhibits 3.1, 3.2, 4.1 and 4.2 to this Current Report on Form 8-K and are incorporated herein by reference.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Appointment of Director
The information set forth in the Introductory Note and Item 2.01 of this Current Report on Form 8-K is incorporated herein by reference.
On October 2, 2020, effective upon the consummation of the Mergers and pursuant to the terms of the Merger Agreement, which permits E*TRADE to designate one individual from the Board of Directors of E*TRADE reasonably acceptable to Morgan Stanley to become a director on the Board of Directors of Morgan Stanley (the “Board”), the Board increased the number of directors on the Board from 14 to 15 and elected Shelley B. Leibowitz to the Board. The Board determined that Shelley B. Leibowitz is independent in accordance with the director independence standards established under Morgan Stanley’s Corporate Governance Policies. Shelley B. Leibowitz served as a director of E*TRADE from December 2014 to the Effective Time and was a member of E*TRADE’s Governance Committee and Risk Oversight Committee. Shelley B. Leibowitz will receive compensation as a non-employee director in accordance with the Company’s non-employee director compensation practices described in “Item 1 − Election of Directors: Corporate Governance Practices − Director Compensation” of the Company’s Annual Meeting Proxy Statement filed with the Securities and Exchange Commission on April 3, 2020.
Other than the Merger Agreement, there are no arrangements or understandings between Shelley B. Leibowitz and any other person pursuant to which Shelley B. Leibowitz was selected as a director of Morgan Stanley. There are no transactions in which Shelley B. Leibowitz has an interest requiring disclosure under Item 404(a) of Regulation S-K.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
The information set forth in the Introductory Note and Item 2.01 of this Current Report on Form 8-K is incorporated herein by reference.
On October 1, 2020, the Registrant filed a Certificate of Designation to its Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, establishing the terms of the Registrant’s Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series M, par value $0.01 per share, liquidation preference $1,000 per share (the “Morgan Stanley Series M Preferred Stock”). A copy of the Certificate of Designation relating to the Morgan Stanley Series M Preferred Stock is filed as Exhibits 3.1 and 4.1 to this Current Report on Form 8-K and is incorporated herein by reference.
On October 1, 2020, the Registrant filed a Certificate of Designation to its Amended and Restated Certificate of Incorporation with the Secretary of State of the State of Delaware, establishing the terms of the Registrant’s Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series N, par value $0.01 per share, liquidation preference $100,000 per share (the “Morgan Stanley Series N Preferred Stock”). A copy of the Certificate of Designation relating to the Morgan Stanley Series N Preferred Stock is filed as Exhibits 3.2 and 4.2 to this Current Report on Form 8-K and is incorporated herein by reference.
Item 7.01. Regulation FD Disclosure.
On October 2, 2020, Morgan Stanley issued a press release announcing the completion of the Mergers, which is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.
The foregoing information in Item 7.01 of this Current Report on Form 8-K, including the press release attached hereto as Exhibit 99.1, is being furnished pursuant to Item 7.01 and shall not be deemed “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, and it shall not be deemed incorporated by reference in any filing under the Securities Act of 1933 or the Exchange Act of 1934, each as amended, whether made before or after the date hereof, except as expressly set forth by specific reference in such filing to Item 7.01 of this Current Report on Form 8-K.
Additional exhibits are filed herewith in connection with the issuance of depositary shares representing interests in the Morgan Stanley Series N Preferred Stock.
Item 8.01. Other Matters.
The following risk factors supplement the “Risk Factors” in Part I, Item 1A of the Company’s Annual Report on Form 10-K for the year ended December 31, 2019.
Our ability to realize the anticipated benefits and synergies from the acquisition of E*TRADE involves a number of risks.
Our acquisition and integration of E*TRADE involves a number of risks, including failure to realize anticipated benefits and synergies of the acquisition and difficulty integrating the two businesses, including our inability to successfully combine E*TRADE’s businesses with ours, to rationalize technology platforms, to achieve expected cost savings and funding benefits, and the assumption of known and unknown liabilities of E*TRADE. It is possible that the integration process could also result in unanticipated disruption to the E*TRADE direct-to-consumer online platform, the loss of key Morgan Stanley or E*TRADE employees, the loss of clients, or an overall integration process that takes longer than originally anticipated.
We will be subject to increased risks associated with E*TRADE’s businesses and direct-to-consumer model.
As a result of the acquisition we will be subject to increased exposure to risks associated with the direct-to-consumer retail brokerage services industry. Changes in interest rates and our inability to manage interest rate risk in our retail securities business could negatively impact the profitability of this business. In addition, changes in business, economic, political, or competitive conditions could cause a downturn in the global financial markets, and such a downturn could decrease the volume of customer transactions, result in a reduction of cash or securities balances held in E*TRADE accounts, reduce demand for margin lending or increase pricing pressure, which may, in turn, result in lower net interest income, trading-based revenue, fees and service charges.
Further, E*TRADE’s customers primarily conduct financial transactions over the internet and through mobile services, which may expose us to increased operational risks, including technological failures, cyber-attacks, privacy breaches, human error or fraud. In addition, extraordinary trading volumes or site usage could cause our systems to operate at an unacceptably slow speed or even fail. Disruptions to, destruction of, instability of or other failure to effectively maintain our information technology systems or external technology that allows retail customers to use brokerage products and services could harm our business and our reputation. We will also need to manage additional regulatory and compliance risks associated with E*TRADE’s direct-to-consumer business.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits. The following exhibits are filed with this report:
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Exhibit No. |
Description | |
| 3.1 and 4.1 | ||
| 3.2 and 4.2 | ||
| 4.3 | Form of Certificate representing the Morgan Stanley Series M Preferred Stock. | |
| 4.4 |
Form of Certificate representing the Morgan Stanley Series N Preferred Stock. | |
| 4.5 | ||
| 4.6 | ||
| 99.1 |
Joint Press Release issued by Morgan Stanley and E*TRADE, dated October 2, 2020. | |
| 101 |
Interactive Data Files pursuant to Rule 406 of Regulation S-T formatted in Inline eXtensible Business Reporting Language (“Inline XBRL”). | |
| 104 | Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101). | |
Signature(s)
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| MORGAN STANLEY | |||||||
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By: /s/ Martin M. Cohen | |||||||
| Date: October 2, 2020 | Name: Martin M. Cohen | ||||||
| Title: Corporate Secretary | |||||||
Exhibits 3.1 and 4.1
CERTIFICATE OF DESIGNATION OF PREFERENCES
AND RIGHTS OF THE
FIXED-TO-FLOATING RATE NON-CUMULATIVE PREFERRED STOCK, SERIES M
(Liquidation Preference $1,000 per share)
OF
MORGAN STANLEY
_________________________
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
_________________________
Morgan Stanley, a Delaware corporation (hereinafter called the “Corporation”), DOES HEREBY CERTIFY that, pursuant to resolutions of the Board of Directors of the Corporation adopted on February 19, 2020, the creation of Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series M, par value $0.01 per share, liquidation preference $1,000 per share (“Series M”), of the Corporation was authorized and the designation, preferences, privileges, voting rights, and other special rights and qualifications, limitations and restrictions of the Series M, in addition to those set forth in the Certificate of Incorporation and Bylaws of the Corporation, are fixed as follows:
1. Designation. The distinctive serial designation of such series of preferred stock is “Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series M.” Each share of Series M shall be identical in all respects to every other share of Series M, except as to the respective dates from which dividends thereon shall accrue, to the extent such dates may differ as permitted pursuant to Section 4(a) below.
2. Number of Shares. The authorized number of shares of Series M shall be 400,000. Shares of Series M that are redeemed, purchased or otherwise acquired by the Corporation, or converted into another series of Preferred Stock, shall be cancelled and shall revert to authorized but unissued shares of Preferred Stock; provided that this Section 2 shall not apply to any purchase or other acquisition of shares of Series M by any subsidiary of the Corporation.
3. Definitions. As used herein with respect to Series M:
(a) “Board of Directors” means the board of directors of the Corporation.
(b) “Bylaws” means the amended and restated bylaws of the Corporation, as they may be amended from time to time.
(c) “Business Day” means any day, other than a Saturday or 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.
(d) “Calculation Agent” means, at any time, the person or entity appointed by the Corporation and serving as such agent at such time. The Corporation may terminate any such appointment and may appoint a successor agent at any time and from time to time, provided that the Corporation shall use its best efforts to ensure that there is, at all relevant times when the Series M is outstanding, a person or entity appointed and serving as such agent. The Calculation Agent may be a person or entity affiliated with the Corporation.
(e) “Certificate of Designation” means this Certificate of Designation relating to the Series M, as it may be amended or supplemented from time to time.
(f) “Certification of Incorporation” shall mean the amended and restated certificate of incorporation of the Corporation, as it may be amended from time to time, and shall include this Certificate of Designation.
(g) “Common Stock” means the common stock, par value $0.01 per share, of the Corporation.
(h) “Dividend Determination Date” means, for each Dividend Period during the Floating Rate Period, the second London Business Day immediately preceding the first day of such Dividend Period.
(i) “Dividend Payment Date” means March 15 and September 15 of each year, commencing on March 15, 2021 and ending on September 15, 2026 and thereafter March 15, June 15, September 15 and December 15 of each year, subject to adjustment as described in Section 4(a).
(j) “Dividend Period” has the meaning set forth in Section 4(a).
(k) “Dividend Record Date” has the meaning set forth in Section 4(a).
(l) “Federal Reserve Board” means the Board of Governors of the Federal Reserve System.
(m) “Fixed Rate Period” has the meaning set forth in Section 4(a).
(n) “Floating Rate Period” has the meaning set forth in Section 4(a).
(o) “Junior Stock” means any class or series of capital stock of the Corporation that ranks junior to Series M as to the payment of dividends and the distribution of assets upon liquidation, dissolution or winding up of the Corporation. Junior Stock includes the Common Stock.
(p) “LIBOR” has the meaning set forth in Section 4(a).
(q) “Liquidation Preference” has the meaning set forth in Section 5(b).
(r) “London Business Day” means a day that is a Monday, Tuesday, Wednesday, Thursday or Friday and is a day on which dealings in U.S. dollars are transacted in the London interbank market.
(s) “Nonpayment” has the meaning set forth in Section 7(b).
(t) “Original Issue Date” means October 2, 2020.
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(u) “Parity Stock” means any other class or series of stock of the Corporation that ranks equally with the Series M in the payment of dividends, whether cumulative or non-cumulative, and the distribution of assets upon liquidation, dissolution or winding up of the Corporation. Parity Stock includes the Corporation’s previously issued Floating Rate Non-Cumulative Preferred Stock, Series A, liquidation preference $25,000 per share (“Series A”), the Corporation’s previously issued 10% Series C Non-Cumulative Non-Voting Perpetual Preferred Stock, liquidation preference $1,000 per share (“Series C”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series E, liquidation preference $25,000 per share (“Series E”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series F, liquidation preference $25,000 per share (“Series F”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series H, liquidation preference $25,000 per share (“Series H”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series I, liquidation preference $25,000 per share (“Series I”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series J, liquidation preference $25,000 per share (“Series J”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series K, liquidation preference $25,000 per share (“Series K”), the Corporation’s previously issued 4.875% Non-Cumulative Preferred Stock, Series L, liquidation preference $25,000 per share (“Series L”) and the Corporation’s Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series N, liquidation preference $100,000 per share (“Series N”).
(v) “Preferred Stock” means any and all series of preferred stock of the Corporation, including the Series M.
(w) “Preferred Stock Directors” has the meaning set forth in Section 7(b).
(x) “Regulatory Capital Treatment Event” has the meaning set forth in Section 6(a).
(y) “Voting Preferred Stock” means any other class or series of Preferred Stock of the Corporation ranking equally with the Series M as to dividends (whether cumulative or non-cumulative) and the distribution of assets upon liquidation, dissolution or winding up of the Corporation and upon which like voting rights have been conferred and are exercisable. Voting Preferred Stock includes the Series A, the Series C, the Series E, the Series F, the Series H, the Series I, the Series J, the Series K, the Series L and the Series N. Whether a plurality, majority or other portion of the shares of Series M and any other Voting Preferred Stock have been voted in favor of any matter shall be determined by reference to the liquidation amounts of the shares voted.
4. Dividends.
(a) Rate. Holders of Series M will be entitled to receive, only when, as and if declared by the Board of Directors or a duly authorized committee of the Board of Directors, out of funds legally available for the payment of dividends under Delaware law, non-cumulative cash dividends from September 15, 2020 (in the case of the initial Dividend Period only) or the immediately preceding Dividend Payment Date, semi-annually in arrears on the 15th day of March and September of each year, commencing on March 15, 2021 and ending on September 15, 2026 and thereafter quarterly in arrears on the 15th day of March, June, September and December of each year. These dividends will accrue on the liquidation preference amount of $1,000 per share at a rate per annum equal to 5.875% with respect to each Dividend Period from
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and including September 15, 2020 to, but excluding, September 15, 2026 (the “Fixed Rate Period”) and at a rate per annum equal to the three-month U.S. dollar LIBOR on the related Dividend Determination Date plus 4.435% with respect to each Dividend Period from and including September 15, 2026 (the “Floating Rate Period”). In the event that the Corporation issues additional shares of Series M after the Original Issue Date, dividends on such shares may accrue from the Original Issue Date or any other date specified by the Board of Directors or an authorized committee thereof at the time such additional shares are issued.
References to the “accrual” (or similar terms) of dividends in this Certificate of Designation refer only to the determination of the amount of such dividend and do not imply that any right to a dividend arises prior to the date on which a dividend is declared.
Dividends that are payable on Series M on any Dividend Payment Date will be payable to holders of record of Series M as they appear on the stock register of the Corporation on the applicable record date, which shall be the 15th calendar day before such Dividend Payment Date or such other record date fixed by the Board of Directors or a duly authorized committee of the Board of Directors that is not more than 60 nor less than 10 days prior to such Dividend Payment Date (each, a “Dividend Record Date”).
A “Dividend Period” is the period from and including a Dividend Payment Date to but excluding the next Dividend Payment Date or any earlier redemption date, except that (i) the initial Dividend Period for any share of Series M issued on the Original Issue Date will commence on and include September 15, 2020 and will end on and exclude the March 15, 2021 Dividend Payment Date, and (ii) for any share of Series M issued after the Original Issue Date, the initial Dividend Period for such shares may commence on and include the Original Issue Date or such other date as the Board of Directors or a duly authorized committee of the Board of Directors shall determine and publicly disclose and shall end on and exclude the next Dividend Payment Date. Dividends payable on the Series M for any Dividend Period during the Fixed Rate Period will be computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends payable on the Series M for any Dividend Period during the Floating Rate Period will be computed on the basis of a 360-day year and the actual number of days elapsed in the Dividend Period. Dividends for the initial Dividend Period for shares of Series M issued on the Original Issue Date will be calculated from September 15, 2020. If any scheduled Dividend Payment Date up to and including the September 15, 2026 scheduled Dividend Payment Date is not a Business Day, then the payment will be made on the next succeeding Business Day and no additional dividends will accrue as a result of that postponement. If any scheduled Dividend Payment Date thereafter is not a Business Day, then the Dividend Payment Date will be postponed to the next succeeding Business Day unless such day falls in the next calendar month, in which case the Dividend Payment Date will be brought forward to the immediately preceding day that is a Business Day, and, in either case, dividends, if so declared, will accrue to, but excluding, the date dividends are paid.
For any Dividend Period during the Floating Rate Period, LIBOR (the London interbank offered rate) shall be determined by the Calculation Agent on the Dividend Determination Date in the following manner:
(i) LIBOR will be the rate for deposits in U.S. dollars for a period of three months, commencing on the first day of such Dividend Period, that appears on Reuters screen page “LIBOR01”, or any successor page, at approximately 11:00 a.m., London time, on that Dividend Determination Date.
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(ii) If no such rate appears, then the Calculation Agent will request the principal London offices of each of four major reference banks in the London interbank market, selected by the Calculation Agent as directed by the Corporation, to provide the Calculation Agent with its offered quotation for deposits in U.S. dollars for a period of three months, commencing on the first day of such Dividend Period, to prime banks in the London interbank market at approximately 11:00 a.m., London time, on that Dividend Determination Date and in a principal amount that is representative of a single transaction in U.S. dollars in that market at that time. If at least two quotations are provided, LIBOR determined on that Dividend Determination Date will be the arithmetic mean of those quotations. If fewer than two quotations are provided, LIBOR will be determined for the first day of such Dividend Period as the arithmetic mean of the rates quoted at approximately 11:00 a.m., New York time, on that Dividend Determination Date, by three major banks in New York City, selected by the Calculation Agent as directed by the Corporation, for loans in U.S. dollars to leading European banks, for a period of three months, commencing on the first day of such Dividend Period, and in a principal amount that is representative of a single transaction in U.S. dollars in that market at that time. If the banks so selected by the Calculation Agent are not quoting as set forth above, LIBOR for that Dividend Determination Date will be the same as LIBOR for the immediately preceding Dividend Period, or, if there was no such Dividend Period, the dividend payable will be based on the initial dividend rate. The Calculation Agent’s determination of LIBOR and the calculation of the amount of dividends for each Dividend Period shall be final and binding absent manifest error.
The Calculation Agent’s determination of any dividend rate, and its calculation of the amount of dividends for any Dividend Period, will be on file at the Corporation’s principal offices, will be made available to any stockholder upon request and will be final and binding in the absence of manifest error.
“Reuters” means Reuters 3000 Xtra Service or any successor service.
Holders of Series M shall not be entitled to any dividends, whether payable in cash, securities or other property, other than dividends (if any) declared and payable on the Series M as specified in this Section 4 (subject to the other provisions of this Certificate of Designation).
Dividends on shares of the Series M will not be cumulative. Accordingly, if the Board of Directors (or a duly authorized committee thereof) does not declare a dividend on the Series M payable in respect of any Dividend Period before the related Dividend Payment Date, such dividend will not accrue and the Corporation will have no obligation to pay a dividend for that Dividend Period on the Dividend Payment Date or at any future time, whether or not dividends on the Series M are declared for any future Dividend Period.
(b) Priority of Dividends. The Series M will rank i) senior to the Common Stock and any class or series of the Corporation’s capital stock expressly stated to be junior to the Series M, ii) junior to any class or series of the Corporation’s capital stock expressly stated to be senior to the Series M (issued with the requisite consent of the holders of the Series M) and iii) equally with the Series A, the Series C, the Series E, the Series F, the Series H, the Series I, the Series J, the Series K, the Series L, the Series N and each other class or series of Preferred Stock the Corporation may issue that is not expressly stated to be senior or junior to the Series M, with respect to the payment of dividends and the distribution of assets upon liquidation, dissolution or winding up of the Corporation. If at any time the Corporation has failed
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to pay, on the applicable Dividend Payment Date, accrued dividends on any shares that rank senior in priority to the Series M with respect to dividends, the Corporation may not pay any dividends on the Series M or redeem or otherwise repurchase any shares of Series M until the Corporation has paid or set aside for payment the full amount of the unpaid dividends on the shares that rank senior in priority with respect to dividends that must, under the terms of such shares, be paid before the Corporation may pay dividends on, or redeem or repurchase, the Series M.
So long as any share of Series M remains outstanding, no dividend or distribution shall be paid or declared or funds set aside for payment on Junior Stock, and no Junior Stock shall be purchased, redeemed or otherwise acquired for consideration by the Corporation, directly or indirectly, and no shares of Parity Stock shall be purchased, redeemed or otherwise acquired for consideration by the Corporation, other than pursuant to pro rata offers to purchase all, or a pro rata portion, of the Preferred Stock and such Parity Stock during a Dividend Period, unless the full dividend for the latest completed Dividend Period on all outstanding shares of Series M has been declared and paid (or declared and a sum sufficient for the payment thereof has been set aside). The foregoing limitation with respect to the Junior Stock shall not apply to:
| · | repurchases, redemptions or other acquisitions of shares of Junior Stock in connection with (1) any employment contract, benefit plan or other similar arrangement with or for the benefit of any one or more employees, officers, directors or consultants or (2) a dividend reinvestment plan or stockholder stock purchase plan; |
| · | purchases or repurchases of shares of Junior Stock pursuant to a contractually binding requirement to buy Junior Stock existing prior to the commencement of the then-current Dividend Period, including under a contractually binding stock repurchase plan; |
| · | an exchange, redemption, reclassification or conversion of any class or series of Junior Stock for any class or series of Junior Stock; |
| · | the purchase of fractional interests in shares of Junior Stock under the conversion or exchange provisions of Junior Stock or the security being converted or exchanged; |
| · | any declaration of a dividend payable solely in Junior Stock in connection with any stockholders’ rights plan, or the issuance of rights, stock or other property under any stockholders’ rights plan (so long as such right to stock or other property only consists of Junior Stock or the right to purchase Junior Stock), or the redemption or repurchase of rights pursuant to the plan; or |
| · | any dividend in the form of stock, warrants, options or other rights where the dividend stock or the stock issuable upon exercise of such warrants, options or other rights is the same stock as that on which the dividend is being paid or ranks equal or junior to that stock. |
The foregoing limitation with respect to the Parity Stock shall not apply to:
| · | purchases or repurchases of shares of Parity Stock pursuant to a contractually binding requirement to buy Parity Stock existing prior to the commencement of the then-current Dividend Period, including under a contractually binding stock repurchase plan; |
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| · | an exchange, redemption, reclassification or conversion of any class or series of Parity Stock for any class or series of Parity Stock; |
| · | the purchase of fractional interests in shares of Parity Stock under the conversion or exchange provisions of Parity Stock or the security being converted or exchanged; or |
| · | any dividend in the form of stock, warrants, options or other rights where the dividend stock or the stock issuable upon exercise of such warrants, options or other rights is the same stock as that on which the dividend is being paid or ranks equal or junior to that stock. |
In addition, the foregoing limitation shall not restrict the ability of Morgan Stanley & Co. LLC, or any other affiliate of the Corporation, (i) to engage in any market-making transactions in Junior Stock or Parity Stock in the ordinary course of business or (ii) to acquire record ownership in Junior Stock or Parity Stock for the beneficial ownership of any other persons (other than for the beneficial ownership by the Corporation or any subsidiaries of the Corporation), including as trustees or custodians.
When dividends are not paid (or declared and a sum sufficient for payment thereof set aside) on any Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment Dates, on a dividend payment date falling within the related Dividend Period) in full upon the Series M and any shares of Parity Stock, all dividends declared on the Series M and all such Parity Stock and payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment Dates, on a dividend payment date falling within the related Dividend Period) shall be declared pro rata so that the respective amounts of such dividends shall bear the same ratio to each other as all accrued but unpaid dividends per share on the Series M and all Parity Stock payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment Dates, on a dividend payment date falling within the related Dividend Period) bear to each other.
Subject to the foregoing, dividends (payable in cash, securities or other property) may be determined by the Board of Directors or a duly authorized committee of the Board of Directors and may be declared and paid on the Common Stock and any stock ranking, as to dividends, equally with or junior to the Series M, from time to time out of any funds legally available for such payment, and the Series M shall not be entitled to participate in any such dividends.
(c) Restrictions on the Payment of Dividends. Dividends on the Series M may be subject to the Corporation’s receipt of required prior approval by the Federal Reserve Board (or any successor appropriate federal banking agency) and will not be declared, paid or set aside for payment if the Corporation fails to comply, or if and to the extent such act would cause the Corporation to fail to comply, with applicable laws and regulations, including the capital adequacy guidelines of the Federal Reserve Board (or, as and if applicable, the capital adequacy guidelines or regulations of any successor appropriate federal banking agency) applicable to the Corporation.
5. Liquidation Rights.
(a) Voluntary or Involuntary Liquidation. Upon any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, holders of Series M shall be entitled to receive out of the assets of the Corporation or proceeds thereof
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available for distribution to stockholders of the Corporation, after satisfaction of all liabilities to creditors, if any, of the Corporation and subject to the rights of holders of any shares of capital stock of the Corporation then outstanding ranking senior to or pari passu with the Series M in respect of distributions upon liquidation, dissolution or winding up of the Corporation, and before any distribution of such assets or proceeds is made to or set aside for the holders of Common Stock and any of Junior Stock, a liquidating distribution in an amount equal to $1,000 per share, together with an amount equal to all dividends, if any, that have been declared but not paid prior to the date of payment of such distribution (but without any accumulation in respect of dividends that have not been declared prior to such payment date). Holders of the Series M will not be entitled to any other amounts from the Corporation after they have received their full liquidation preference.
The Series M may be fully subordinated to interests held by the U.S. government in the event of a receivership, insolvency, liquidation, or similar proceeding, including a proceeding under the “orderly liquidation authority” provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, as amended.
(b) Partial Payment. If in any distribution described in Section 5(a) above the assets of the Corporation or proceeds thereof are not sufficient to pay the Liquidation Preference (as defined below) in full to all holders of Series M and all holders of any stock of the Corporation ranking equally with the Series M as to such distribution, the amounts paid to the holders of Series M and to the holders of all such other stock shall be paid pro rata in accordance with the respective aggregate Liquidation Preference of the holders of Series M and the holders of all such other stock. In any such distribution, the “Liquidation Preference” of any holder of preferred stock of the Corporation shall mean the amount otherwise payable to such holder in such distribution (assuming no limitation on the assets of the Corporation available for such distribution), including an amount equal to any declared but unpaid dividends (and, in the case of any holder of stock other than Series M and on which dividends accrue on a cumulative basis, an amount equal to any unpaid, accrued, cumulative dividends, whether or not declared, as applicable). Holders of the Series M will not be entitled to any other amounts from the Corporation after they have received the full amounts provided for in this Section 5 and will have no right or claim to any of the Corporation’s remaining assets.
(c) Residual Distributions. If the Liquidation Preference has been paid in full to all holders of Series M and any other shares of the Corporation’s stock ranking equally as to the Liquidation Preference, the holders of other stock of the Corporation ranking junior as to the Liquidation Preference shall be entitled to receive all remaining assets of the Corporation (or proceeds thereof) according to their respective rights and preferences.
(d) Merger, Consolidation and Sale of Assets Not Liquidation. For purposes of this Section 5, the merger or consolidation of the Corporation with or into any other corporation or other entity, including a merger or consolidation in which the holders of Series M receive cash, securities or other property for their shares, or the sale, lease or exchange (for cash, securities or other property) of all or substantially all of the assets of the Corporation, shall not constitute a liquidation, dissolution or winding up of the Corporation.
6. Redemption.
(a) Optional Redemption. The Corporation may, at its option, redeem the Series M (i) in whole or in part, from time to time, on any Dividend Payment Date on
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or after September 15, 2026 or (ii) in whole but not in part at any time within 90 days following a Regulatory Capital Treatment Event (as defined below), in each case upon notice given as provided in Section 6(c) below, at a redemption price equal to $1,000 per share, together with (except as otherwise provided herein below) any declared and unpaid dividends to, but excluding, the date fixed for redemption, without accumulation of any undeclared dividends. The redemption price for any shares of Series M shall be payable on the redemption date to the holder of such shares against surrender of the certificate(s) evidencing such shares to the Corporation or its agent. Any declared and unpaid dividend for the then current Dividend Period payable on a redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall not be paid to the holder entitled to receive the redemption price on the redemption date, but rather shall be paid to the holder of record of the redeemed shares on such Dividend Record Date relating to the Dividend Payment Date as provided in Section 4 above.
A “Regulatory Capital Treatment Event” means the good faith determination by the Corporation that, as a result of (i) any amendment to, or change in, the laws or regulations of the United States or any political subdivision of or in the United States that is enacted or becomes effective after the Original Issue Date, (ii) any proposed change in those laws or regulations that is announced or becomes effective after the Original Issue Date, or (iii) any official administrative decision or judicial decision or administrative action or other official pronouncement interpreting or applying those laws or regulations that is announced after the Original Issue Date, there is more than an insubstantial risk that the Corporation will not be entitled to treat the full liquidation preference amount of $1,000 per share of Series M then outstanding as “Additional Tier 1” capital (or its equivalent) for purposes of the capital adequacy guidelines of the Federal Reserve Board (or, as and if applicable, the capital adequacy guidelines or regulations of any successor appropriate federal banking agency) as then in effect and applicable, for so long as any share of Series M is outstanding. “Appropriate federal banking agency” means the “appropriate federal banking agency” with respect to the Corporation as that term is defined in Section 3(q) of the Federal Deposit Insurance Act or any successor provision.
(b) No Sinking Fund. The Series M will not be subject to any mandatory redemption, sinking fund or other similar provisions. Holders of Series M will have no right to require the redemption or repurchase of any shares of Series M.
(c) Notice of Redemption. Notice of every redemption of shares of Series M shall be given by first class mail, postage prepaid, addressed to the holders of record of the shares to be redeemed at their respective last addresses appearing on the books of the Corporation. Such mailing shall be not less than 30 days nor more than 60 days before the date fixed for redemption, provided that, if the shares of Series M are held in book-entry form through The Depository Trust Company (“DTC”), the Corporation may give such notice in any manner permitted by DTC. Any notice mailed as provided in this Subsection shall be conclusively presumed to have been duly given, whether or not the holder receives such notice, but failure to duly give such notice by mail, or any defect in such notice or in the mailing thereof, to any holder of shares of Series M designated for redemption shall not affect the validity of the proceedings for the redemption of any other shares of Series M. Each such notice given to a holder shall state: (1) the redemption date; (2) the number of shares of Series M 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; and (4) the place or places where certificates for such shares are to be surrendered for payment of the redemption price.
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(d) Regulatory Approval. Any redemption of the Series M is subject to the Corporation’s receipt of required prior approval, if any, by the Federal Reserve Board (or any successor appropriate federal banking agency), and to the satisfaction of conditions, if any, set forth in the capital adequacy guidelines of the Federal Reserve Board (or, as and if applicable, the capital adequacy guidelines or regulations of any successor appropriate federal banking agency) applicable to the redemption of the Series M.
(e) Partial Redemption. In case of any redemption of only part of the shares of Series M at the time outstanding, the shares to be redeemed shall be selected pro rata, provided that, if the shares of Series M are held in book-entry form through DTC, the shares of Series M to be redeemed shall be selected in accordance with DTC procedures. Subject to the provisions hereof, the Corporation shall have full power and authority to prescribe the terms and conditions upon which shares of Series M shall be redeemed from time to time. If fewer than all the shares represented by any certificate are redeemed, a new certificate shall be issued representing the unredeemed shares without charge to the holder thereof.
(f) Effectiveness of Redemption. If notice of redemption has been duly given and if on or prior to the redemption date specified in the notice all funds necessary for the redemption have been set aside by the Corporation, separate and apart from its other funds, in trust for the pro rata benefit of the holders of any shares of Series M so called for redemption, so as to be and continue to be available therefor, then, notwithstanding that any certificate for any share so called for redemption has not been surrendered for cancellation, on and after the redemption date dividends shall cease to accrue on all shares so called for redemption, all shares so called for redemption shall no longer be deemed outstanding and all rights with respect to such shares shall forthwith on such redemption date cease and terminate, except only the right of the holders thereof to receive the amount payable on such redemption, without interest. Any funds unclaimed at the end of two years from the redemption date shall, to the extent permitted by law, be released to the Corporation, after which time the holders of the shares so called for redemption shall look only to the Corporation for payment of the redemption price of such shares.
7. Voting Rights.
(a) General. The holders of Series M shall not have any voting rights except as set forth below and as determined by the Board of Directors or an authorized committee thereof or as otherwise from time to time required by law. For the avoidance of doubt, the shares of Series M shall not be entitled to vote generally in the election of directors, including following Nonpayment events.
(b) Right To Elect Two Directors Upon Nonpayment Events. If and whenever dividends on any shares of the Series M, or any other Voting Preferred Stock, shall have not been declared and paid for the equivalent of three semi-annual or six quarterly full dividend payments, whether or not for consecutive Dividend Periods (a “Nonpayment”), the holders of such shares, voting together as a class with holders of any and all other series of Voting Preferred Stock then outstanding, will be entitled to vote for the election of a total of two additional members of the Board of Directors (the “Preferred Stock Directors”), provided that the election of any such directors shall not cause the Corporation to violate the corporate governance requirements of the New York Stock Exchange (or any other exchange on which the Corporation’s Common Stock may be listed) that listed companies must have a majority of independent directors and provided further that the Board of Directors shall at no time include more than two Preferred Stock Directors (to the extent that such requirements are then applicable to the Corporation). In that event, the number of directors on the Board of
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Directors shall automatically increase by two, and the new directors shall be elected at a special meeting called at the request of the holders of record of at least 20% of the then outstanding shares of Series M or of any other series of Voting Preferred Stock (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the stockholders, in which event such election shall be held at such next annual or special meeting of stockholders), and at each subsequent annual meeting. Such request to call a special meeting for the initial election of the Preferred Stock Directors after a Nonpayment shall be made by written notice, signed by the requisite holders of Series M or other Voting Preferred Stock, and delivered to the Secretary of the Corporation in such manner as provided for in Section 9 below, or as may otherwise be required by law. The voting rights will continue until dividends on the shares of the Series M and any such series of Voting Preferred Stock shall have been fully paid (or declared and a sum sufficient for the payment of such dividends shall have been set aside for such payment) for at least the equivalent of two consecutive semi-annual Dividend Periods or four consecutive quarterly Dividend Periods following the Nonpayment.
If and when dividends for at least the equivalent of two consecutive semi-annual Dividend Periods or four consecutive quarterly Dividend Periods following a Nonpayment have been fully paid (or declared and a sum sufficient for such payment shall have been set aside) on the Series M and any other class or series of Voting Preferred Stock, the holders of the Series M and all other holders of Voting Preferred Stock shall be divested of the foregoing voting rights (subject to revesting in the event of each subsequent Nonpayment), the term of office of each Preferred Stock Director so elected shall terminate and the number of directors on the Board of Directors shall automatically decrease by two. In determining whether dividends have been paid for at least the equivalent of two consecutive semi-annual Dividend Periods or four consecutive quarterly Dividend Periods following a Nonpayment, the Corporation may take account of any dividend payment (at the same rate and amount otherwise payable on the Series M) it elects to pay for any dividend period after the regular dividend date for that period has passed. Any Preferred Stock Director may be removed at any time without cause by the holders of record of a majority of the outstanding shares of the Series M together with all series of Voting Preferred Stock then outstanding (voting together as a single class) to the extent such holders have the voting rights described above. So long as a Nonpayment shall continue, any vacancy in the office of a Preferred Stock Director (other than prior to the initial election after a Nonpayment) may be filled by the written consent of the Preferred Stock Director remaining in office, or if none remains in office, by a vote of the holders of record of a majority of the outstanding shares of Series M and all Voting Preferred Stock when they have the voting rights described above (voting together as a single class); provided that the filling of each vacancy shall not cause the Corporation to violate the corporate governance requirements of the New York Stock Exchange (or any other exchange on which the Corporation’s Common Stock may be listed) that listed companies must have a majority of independent directors (to the extent such requirements are then applicable to the Corporation). Any such vote to remove, or to fill a vacancy in the office of, a Preferred Stock Director may be taken only at a special meeting called at the request of the holders of record of at least 20% of the Series M or of any other series of Voting Preferred Stock (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the stockholders, in which event such election shall be held at such next annual or special meeting of stockholders). The Preferred Stock Directors shall each be entitled to one vote per director on any matter.
(c) Other Voting Rights. So long as any shares of Series M are outstanding, in addition to any other vote or consent of stockholders required by law or by the Certificate of Incorporation, the vote or consent of the holders of at least two-
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thirds of the shares of Series M and any Voting Preferred Stock at the time outstanding and entitled to vote thereon, voting together as a single class, given in person or by proxy, either in writing without a meeting (to the extent permitted by the procedures for voting and consents in Section 7(f) below) or by vote at any meeting called for the purpose, shall be necessary for effecting or validating:
(i) Authorization of Senior Stock. Any amendment or alteration of the provisions of the Certificate of Incorporation or this Certificate of Designation to authorize or create, or increase the authorized amount of, any shares of any class or series of stock of the Corporation ranking senior to the Series M with respect to the payment of dividends or the distribution of assets upon any liquidation, dissolution or winding up of the Corporation;
(ii) Amendment of Series M. Any amendment, alteration or repeal of any provision of the Certificate of Incorporation or this Certificate of Designation, whether by merger, consolidation or otherwise, so as to materially and adversely affect the special rights, preferences, privileges and voting powers of the Series M, taken as a whole; or
(iii) Share Exchanges, Reclassifications, Mergers and Consolidations. Any consummation of a binding share exchange or reclassification involving the Series M, or of a merger or consolidation of the Corporation with another entity, unless in each case (x) the shares of Series M remain outstanding or, in the case of any such merger or consolidation with respect to which the Corporation is not the surviving or resulting entity, are converted into or exchanged for preference securities of the surviving or resulting entity or its ultimate parent, and (y) such shares remaining outstanding or such preference securities, as the case may be, have such rights, preferences, privileges and voting powers, and limitations and restrictions thereof, taken as a whole, as are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers of the Series M, taken as a whole;
provided, however, that for all purposes of this Section 7(c), any increase in the amount of the authorized or issued Series M, Series A, Series C, Series E, Series F, Series H, Series I, Series J, Series K, Series L or Series N, or the creation and issuance, or an increase in the authorized or issued amount, of any other class or series of Preferred Stock ranking equally with the Series M with respect to the payment of dividends (whether such dividends are cumulative or non-cumulative) and the distribution of assets upon liquidation, dissolution or winding up of the Corporation will not be deemed to adversely affect the rights, preferences, privileges or voting powers of, and will not require the affirmative vote or consent of, the holders of outstanding shares of Series M.
If any amendment, alteration, repeal, share exchange, reclassification, merger or consolidation specified in this Section 7(c) would adversely affect one or more but not all other series of Voting Preferred Stock (including the Series M for this purpose), then only such series of Preferred Stock as are adversely affected by and entitled to vote on the matter shall vote on the matter together as a class in lieu of all other series of Preferred Stock. If all series of Preferred Stock are not equally affected by the proposed amendment, alteration, repeal, share exchange, reclassification, merger or consolidation described above, there shall be required a two-thirds approval of the class and two-thirds approval of each series that will have a diminished status.
(d) Changes for Clarification. Without the consent of the holders of the Series M, so long as such action does not adversely affect the rights, preferences, privileges and voting powers, and limitations and restrictions thereof, of the Series M,
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the Corporation may amend, alter, supplement or repeal any terms of the Series M to cure any ambiguity, or to cure, correct or supplement any provision contained in this Certificate of Designation that may be defective or inconsistent.
(e) Changes after Provision for Redemption. No vote or consent of the holders of Series M shall be required pursuant to Section 7(b), (c) or (d) above if, at or prior to the time when the act with respect to which any such vote or consent would otherwise be required pursuant to such Section, all outstanding shares of Series M shall have been redeemed, or shall have been called for redemption upon proper notice and sufficient funds shall have been set aside for such redemption, in each case pursuant to Section 6 above.
(f) Procedures for Voting and Consents. The rules and procedures for calling and conducting any meeting of the holders of Series M (including, without limitation, the fixing of a record date in connection therewith), the solicitation and use of proxies at such a meeting, the obtaining of written consents and any other aspect or matter with regard to such a meeting or such consents shall be governed by any rules the Board of Directors or a duly authorized committee of the Board of Directors, in its discretion, may adopt from time to time, which rules and procedures shall conform to the requirements of the Certificate of Incorporation, the Bylaws, applicable law and any national securities exchange or other trading facility on which the Series M is listed or traded at the time. Whether the vote or consent of the holders of a plurality, majority or other portion of the shares of Series M and any Voting Preferred Stock has been cast or given on any matter on which the holders of shares of Series M are entitled to vote shall be determined by the Corporation by reference to the specified liquidation amounts of the shares voted or covered by the consent.
8. Record Holders. To the fullest extent permitted by applicable law, the Corporation and the transfer agent for the Series M may deem and treat the record holder of any share of Series M as the true and lawful owner thereof for all purposes, and neither the Corporation nor such transfer agent shall be affected by any notice to the contrary.
9. Notices. All notices or communications in respect of Series M shall be sufficiently given if given in writing and delivered in person or by first class mail, postage prepaid, or if given in such other manner as may be permitted in this Certificate of Designation, in the Certificate of Incorporation or Bylaws or by applicable law.
10. No Conversion Rights. The Series M will not be convertible into, or exchangeable for, shares of any other class or series of stock or other securities of the Corporation.
11. No Preemptive Rights. No share of Series M shall have any rights of preemption whatsoever as to any securities of the Corporation, or any warrants, rights or options issued or granted with respect thereto, regardless of how such securities, or such warrants, rights or options, may be designated, issued or granted.
12. Other Rights. The shares of Series M shall not have any voting powers, preferences or relative, participating, optional or other special rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or in the Certificate of Incorporation or as provided by applicable law.
13. Effectiveness. This Certificate of Designation shall become effective as of October 2, 2020.
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In Witness Whereof, Morgan Stanley has caused this certificate to be signed by Kevin Sheehan, its Assistant Treasurer, this 1st day of October, 2020.
| MORGAN STANLEY | |||
| By | /s/ Kevin Sheehan | ||
| Name: Kevin Sheehan | |||
| Title: Assistant Treasurer | |||
Exhibits 3.2 and 4.2
CERTIFICATE OF
DESIGNATION OF PREFERENCES AND RIGHTS OF THE
FIXED-TO-FLOATING RATE NON-CUMULATIVE PREFERRED STOCK, SERIES N
(Liquidation Preference $100,000 per share)
OF
MORGAN STANLEY
_________________________
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
_________________________
Morgan Stanley, a Delaware corporation (hereinafter called the “Corporation”), DOES HEREBY CERTIFY that, pursuant to resolutions of the Board of Directors of the Corporation adopted on February 19, 2020, the creation of Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series N, par value $0.01 per share, liquidation preference $100,000 per share (“Series N”), of the Corporation was authorized and the designation, preferences, privileges, voting rights, and other special rights and qualifications, limitations and restrictions of the Series N, in addition to those set forth in the Certificate of Incorporation and Bylaws of the Corporation, are fixed as follows:
1. Designation. The distinctive serial designation of such series of preferred stock is “Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series N.” Each share of Series N shall be identical in all respects to every other share of Series N, except as to the respective dates from which dividends thereon shall accrue, to the extent such dates may differ as permitted pursuant to Section 4(a) below.
2. Number of Shares. The authorized number of shares of Series N shall be 3,000. Shares of Series N that are redeemed, purchased or otherwise acquired by the Corporation, or converted into another series of Preferred Stock, shall be cancelled and shall revert to authorized but unissued shares of Preferred Stock; provided that this Section 2 shall not apply to any purchase or other acquisition of shares of Series N by any subsidiary of the Corporation.
3. Definitions. As used herein with respect to Series N:
(a) “Board of Directors” means the board of directors of the Corporation.
(b) “Bylaws” means the amended and restated bylaws of the Corporation, as they may be amended from time to time.
(c) “Business Day” means any day, other than a Saturday or 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.
(d) “Calculation Agent” means, at any time, the person or entity appointed by the Corporation and serving as such agent at such time. The Corporation may terminate any such appointment and may appoint a successor agent at any time and from time to time, provided that the Corporation shall use its best efforts to ensure that there is, at all relevant times when the Series N is outstanding, a person or entity appointed and serving as such agent. The Calculation Agent may be a person or entity affiliated with the Corporation.
(e) “Certificate of Designation” means this Certificate of Designation relating to the Series N, as it may be amended or supplemented from time to time.
(f) “Certification of Incorporation” shall mean the amended and restated certificate of incorporation of the Corporation, as it may be amended from time to time, and shall include this Certificate of Designation.
(g) “Common Stock” means the common stock, par value $0.01 per share, of the Corporation.
(h) “Dividend Determination Date” means, for each Dividend Period during the Floating Rate Period, the second London Business Day immediately preceding the first day of such Dividend Period.
(i) “Dividend Payment Date” means March 15 and September 15 of each year, commencing on March 15, 2021 and ending on March 15, 2023 and thereafter March 15, June 15, September 15 and December 15 of each year, subject to adjustment as described in Section 4(a).
(j) “Dividend Period” has the meaning set forth in Section 4(a).
(k) “Dividend Record Date” has the meaning set forth in Section 4(a).
(l) “Federal Reserve Board” means the Board of Governors of the Federal Reserve System.
(m) “Fixed Rate Period” has the meaning set forth in Section 4(a).
(n) “Floating Rate Period” has the meaning set forth in Section 4(a).
(o) “Junior Stock” means any class or series of capital stock of the Corporation that ranks junior to Series N as to the payment of dividends and the distribution of assets upon liquidation, dissolution or winding up of the Corporation. Junior Stock includes the Common Stock.
(p) “LIBOR” has the meaning set forth in Section 4(a).
(q) “Liquidation Preference” has the meaning set forth in Section 5(b).
(r) “London Business Day” means a day that is a Monday, Tuesday, Wednesday, Thursday or Friday and is a day on which dealings in U.S. dollars are transacted in the London interbank market.
(s) “Nonpayment” has the meaning set forth in Section 7(b).
(t) “Original Issue Date” means October 2, 2020.
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(u) “Parity Stock” means any other class or series of stock of the Corporation that ranks equally with the Series N in the payment of dividends, whether cumulative or non-cumulative, and the distribution of assets upon liquidation, dissolution or winding up of the Corporation. Parity Stock includes the Corporation’s previously issued Floating Rate Non-Cumulative Preferred Stock, Series A, liquidation preference $25,000 per share (“Series A”), the Corporation’s previously issued 10% Series C Non-Cumulative Non-Voting Perpetual Preferred Stock, liquidation preference $1,000 per share (“Series C”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series E, liquidation preference $25,000 per share (“Series E”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series F, liquidation preference $25,000 per share (“Series F”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series H, liquidation preference $25,000 per share (“Series H”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series I, liquidation preference $25,000 per share (“Series I”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series J, liquidation preference $25,000 per share (“Series J”), the Corporation’s previously issued Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series K, liquidation preference $25,000 per share (“Series K”), the Corporation’s previously issued 4.875% Non-Cumulative Preferred Stock, Series L, liquidation preference $25,000 per share (“Series L”) and the Corporation’s Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series M, liquidation preference $1,000 per share (“Series M”).
(v) “Preferred Stock” means any and all series of preferred stock of the Corporation, including the Series N.
(w) “Preferred Stock Directors” has the meaning set forth in Section 7(b).
(x) “Regulatory Capital Treatment Event” has the meaning set forth in Section 6(a).
(y) “Voting Preferred Stock” means any other class or series of Preferred Stock of the Corporation ranking equally with the Series N as to dividends (whether cumulative or non-cumulative) and the distribution of assets upon liquidation, dissolution or winding up of the Corporation and upon which like voting rights have been conferred and are exercisable. Voting Preferred Stock includes the Series A, the Series C, the Series E, the Series F, the Series H, the Series I, the Series J, the Series K, the Series L and the Series M. Whether a plurality, majority or other portion of the shares of Series N and any other Voting Preferred Stock have been voted in favor of any matter shall be determined by reference to the liquidation amounts of the shares voted.
4. Dividends.
(a) Rate. Holders of Series N will be entitled to receive, only when, as and if declared by the Board of Directors or a duly authorized committee of the Board of Directors, out of funds legally available for the payment of dividends under Delaware law, non-cumulative cash dividends from September 15, 2020 (in the case of the initial Dividend Period only) or the immediately preceding Dividend Payment Date, semi-annually in arrears on the 15th day of March and September of each year, commencing on March 15, 2021 and ending on March 15, 2023 and thereafter quarterly in arrears on the 15th day of March, June, September and December of each year. These dividends will accrue on the liquidation preference amount of $100,000 per share at a rate per annum equal to 5.30% with respect to each Dividend Period from
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and including September 15, 2020 to, but excluding, March 15, 2023 (the “Fixed Rate Period”) and at a rate per annum equal to the three-month U.S. dollar LIBOR on the related Dividend Determination Date plus 3.16% with respect to each Dividend Period from and including March 15, 2023 (the “Floating Rate Period”). In the event that the Corporation issues additional shares of Series N after the Original Issue Date, dividends on such shares may accrue from the Original Issue Date or any other date specified by the Board of Directors or an authorized committee thereof at the time such additional shares are issued.
References to the “accrual” (or similar terms) of dividends in this Certificate of Designation refer only to the determination of the amount of such dividend and do not imply that any right to a dividend arises prior to the date on which a dividend is declared.
Dividends that are payable on Series N on any Dividend Payment Date will be payable to holders of record of Series N as they appear on the stock register of the Corporation on the applicable record date, which shall be the 15th calendar day before such Dividend Payment Date or such other record date fixed by the Board of Directors or a duly authorized committee of the Board of Directors that is not more than 60 nor less than 10 days prior to such Dividend Payment Date (each, a “Dividend Record Date”).
A “Dividend Period” is the period from and including a Dividend Payment Date to but excluding the next Dividend Payment Date or any earlier redemption date, except that (i) the initial Dividend Period for any share of Series N issued on the Original Issue Date will commence on and include September 15, 2020 and will end on and exclude the March 15, 2021 Dividend Payment Date, and (ii) for any share of Series N issued after the Original Issue Date, the initial Dividend Period for such shares may commence on and include the Original Issue Date or such other date as the Board of Directors or a duly authorized committee of the Board of Directors shall determine and publicly disclose and shall end on and exclude the next Dividend Payment Date. Dividends payable on the Series N for any Dividend Period during the Fixed Rate Period will be computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends payable on the Series N for any Dividend Period during the Floating Rate Period will be computed on the basis of a 360-day year and the actual number of days elapsed in the Dividend Period. Dividends for the initial Dividend Period for shares of Series N issued on the Original Issue Date will be calculated from September 15, 2020. If any scheduled Dividend Payment Date up to and including the March 15, 2023 scheduled Dividend Payment Date is not a Business Day, then the payment will be made on the next succeeding Business Day and no additional dividends will accrue as a result of that postponement. If any scheduled Dividend Payment Date thereafter is not a Business Day, then the Dividend Payment Date will be postponed to the next succeeding Business Day unless such day falls in the next calendar month, in which case the Dividend Payment Date will be brought forward to the immediately preceding day that is a Business Day, and, in either case, dividends, if so declared, will accrue to, but excluding, the date dividends are paid.
For any Dividend Period during the Floating Rate Period, LIBOR (the London interbank offered rate) shall be determined by the Calculation Agent on the Dividend Determination Date in the following manner:
(i) LIBOR will be the rate for deposits in U.S. dollars for a period of three months, commencing on the first day of such Dividend Period, that appears on Reuters screen page “LIBOR01”, or any successor page, at approximately 11:00 a.m., London time, on that Dividend Determination Date.
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(ii) If no such rate appears, then the Calculation Agent will request the principal London offices of each of four major reference banks in the London interbank market, selected by the Calculation Agent as directed by the Corporation, to provide the Calculation Agent with its offered quotation for deposits in U.S. dollars for a period of three months, commencing on the first day of such Dividend Period, to prime banks in the London interbank market at approximately 11:00 a.m., London time, on that Dividend Determination Date and in a principal amount that is representative of a single transaction in U.S. dollars in that market at that time. If at least two quotations are provided, LIBOR determined on that Dividend Determination Date will be the arithmetic mean of those quotations. If fewer than two quotations are provided, LIBOR will be determined for the first day of such Dividend Period as the arithmetic mean of the rates quoted at approximately 11:00 a.m., New York time, on that Dividend Determination Date, by three major banks in New York City, selected by the Calculation Agent as directed by the Corporation, for loans in U.S. dollars to leading European banks, for a period of three months, commencing on the first day of such Dividend Period, and in a principal amount that is representative of a single transaction in U.S. dollars in that market at that time.
(iii) Otherwise, the Calculation Agent, after consulting such sources as it deems comparable to any of the foregoing quotations or display page, or any such source as it deems reasonable from which to estimate LIBOR or any of the foregoing lending rates, shall determine three-month LIBOR for the applicable Dividend Period in its sole discretion.
Notwithstanding the foregoing clauses (ii) and (iii):
(A) If the Calculation Agent determines on the relevant Dividend Determination Date that the LIBOR base rate has been discontinued, then the Calculation Agent will use a substitute or successor base rate that it has determined in its sole discretion is most comparable to the LIBOR base rate, provided that if the Calculation Agent determines there is an industry-accepted substitute or successor base rate, then the Calculation Agent shall use such substitute or successor base rate; and
(B) If the Calculation Agent has determined a substitute or successor base rate in accordance with the foregoing, the Calculation Agent in its sole discretion may determine what business day convention to use, the definition of business day, the Dividend Determination Date to be used and any other relevant methodology for calculating such substitute or successor base rate, including any adjustment factor needed to make such substitute or successor base rate comparable to the LIBOR base rate, in a manner that is consistent with industry-accepted practices for such substitute or successor base rate.
The Calculation Agent’s determination of any dividend rate, and its calculation of the amount of dividends for any Dividend Period, will be on file at the Corporation’s principal offices, will be made available to any stockholder upon request and will be final and binding in the absence of manifest error.
“Reuters” means Reuters 3000 Xtra Service or any successor service.
Holders of Series N shall not be entitled to any dividends, whether payable in cash, securities or other property, other than dividends (if any) declared and payable on the Series N as specified in this Section 4 (subject to the other provisions of this Certificate of Designation).
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Dividends on shares of the Series N will not be cumulative. Accordingly, if the Board of Directors (or a duly authorized committee thereof) does not declare a dividend on the Series N payable in respect of any Dividend Period before the related Dividend Payment Date, such dividend will not accrue and the Corporation will have no obligation to pay a dividend for that Dividend Period on the Dividend Payment Date or at any future time, whether or not dividends on the Series N are declared for any future Dividend Period.
(b) Priority of Dividends. The Series N will rank i) senior to the Common Stock and any class or series of the Corporation’s capital stock expressly stated to be junior to the Series N, ii) junior to any class or series of the Corporation’s capital stock expressly stated to be senior to the Series N (issued with the requisite consent of the holders of the Series N) and iii) equally with the Series A, the Series C, the Series E, the Series F, the Series H, the Series I, the Series J, the Series K, the Series L, the Series M and each other class or series of Preferred Stock the Corporation may issue that is not expressly stated to be senior or junior to the Series N, with respect to the payment of dividends and the distribution of assets upon liquidation, dissolution or winding up of the Corporation. If at any time the Corporation has failed to pay, on the applicable Dividend Payment Date, accrued dividends on any shares that rank senior in priority to the Series N with respect to dividends, the Corporation may not pay any dividends on the Series N or redeem or otherwise repurchase any shares of Series N until the Corporation has paid or set aside for payment the full amount of the unpaid dividends on the shares that rank senior in priority with respect to dividends that must, under the terms of such shares, be paid before the Corporation may pay dividends on, or redeem or repurchase, the Series N.
So long as any share of Series N remains outstanding, no dividend or distribution shall be paid or declared or funds set aside for payment on Junior Stock, and no Junior Stock shall be purchased, redeemed or otherwise acquired for consideration by the Corporation, directly or indirectly, and no shares of Parity Stock shall be purchased, redeemed or otherwise acquired for consideration by the Corporation, other than pursuant to pro rata offers to purchase all, or a pro rata portion, of the Preferred Stock and such Parity Stock during a Dividend Period, unless the full dividend for the latest completed Dividend Period on all outstanding shares of Series N has been declared and paid (or declared and a sum sufficient for the payment thereof has been set aside). The foregoing limitation with respect to the Junior Stock shall not apply to:
| · | repurchases, redemptions or other acquisitions of shares of Junior Stock in connection with (1) any employment contract, benefit plan or other similar arrangement with or for the benefit of any one or more employees, officers, directors or consultants or (2) a dividend reinvestment plan or stockholder stock purchase plan; |
| · | purchases or repurchases of shares of Junior Stock pursuant to a contractually binding requirement to buy Junior Stock existing prior to the commencement of the then-current Dividend Period, including under a contractually binding stock repurchase plan; |
| · | an exchange, redemption, reclassification or conversion of any class or series of Junior Stock for any class or series of Junior Stock; |
| · | the purchase of fractional interests in shares of Junior Stock under the conversion or exchange provisions of Junior Stock or the security being converted or exchanged; |
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| · | any declaration of a dividend payable solely in Junior Stock in connection with any stockholders’ rights plan, or the issuance of rights, stock or other property under any stockholders’ rights plan (so long as such right to stock or other property only consists of Junior Stock or the right to purchase Junior Stock), or the redemption or repurchase of rights pursuant to the plan; or |
| · | any dividend in the form of stock, warrants, options or other rights where the dividend stock or the stock issuable upon exercise of such warrants, options or other rights is the same stock as that on which the dividend is being paid or ranks equal or junior to that stock. |
The foregoing limitation with respect to the Parity Stock shall not apply to:
| · | purchases or repurchases of shares of Parity Stock pursuant to a contractually binding requirement to buy Parity Stock existing prior to the commencement of the then-current Dividend Period, including under a contractually binding stock repurchase plan; |
| · | an exchange, redemption, reclassification or conversion of any class or series of Parity Stock for any class or series of Parity Stock; |
| · | the purchase of fractional interests in shares of Parity Stock under the conversion or exchange provisions of Parity Stock or the security being converted or exchanged; or |
| · | any dividend in the form of stock, warrants, options or other rights where the dividend stock or the stock issuable upon exercise of such warrants, options or other rights is the same stock as that on which the dividend is being paid or ranks equal or junior to that stock. |
In addition, the foregoing limitation shall not restrict the ability of Morgan Stanley & Co. LLC, or any other affiliate of the Corporation, (i) to engage in any market-making transactions in Junior Stock or Parity Stock in the ordinary course of business or (ii) to acquire record ownership in Junior Stock or Parity Stock for the beneficial ownership of any other persons (other than for the beneficial ownership by the Corporation or any subsidiaries of the Corporation), including as trustees or custodians.
When dividends are not paid (or declared and a sum sufficient for payment thereof set aside) on any Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment Dates, on a dividend payment date falling within the related Dividend Period) in full upon the Series N and any shares of Parity Stock, all dividends declared on the Series N and all such Parity Stock and payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment Dates, on a dividend payment date falling within the related Dividend Period) shall be declared pro rata so that the respective amounts of such dividends shall bear the same ratio to each other as all accrued but unpaid dividends per share on the Series N and all Parity Stock payable on such Dividend Payment Date (or, in the case of Parity Stock having dividend payment dates different from the Dividend Payment Dates, on a dividend payment date falling within the related Dividend Period) bear to each other.
Subject to the foregoing, dividends (payable in cash, securities or other property) may be determined by the Board of Directors or a duly authorized committee of the Board of Directors and may be declared and paid on the Common Stock and any
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stock ranking, as to dividends, equally with or junior to the Series N, from time to time out of any funds legally available for such payment, and the Series N shall not be entitled to participate in any such dividends.
(c) Restrictions on the Payment of Dividends. Dividends on the Series N may be subject to the Corporation’s receipt of required prior approval by the Federal Reserve Board (or any successor appropriate federal banking agency) and will not be declared, paid or set aside for payment if the Corporation fails to comply, or if and to the extent such act would cause the Corporation to fail to comply, with applicable laws and regulations, including the capital adequacy guidelines of the Federal Reserve Board (or, as and if applicable, the capital adequacy guidelines or regulations of any successor appropriate federal banking agency) applicable to the Corporation.
5. Liquidation Rights.
(a) Voluntary or Involuntary Liquidation. Upon any voluntary or involuntary liquidation, dissolution or winding up of the Corporation, holders of Series N shall be entitled to receive out of the assets of the Corporation or proceeds thereof available for distribution to stockholders of the Corporation, after satisfaction of all liabilities to creditors, if any, of the Corporation and subject to the rights of holders of any shares of capital stock of the Corporation then outstanding ranking senior to or pari passu with the Series N in respect of distributions upon liquidation, dissolution or winding up of the Corporation, and before any distribution of such assets or proceeds is made to or set aside for the holders of Common Stock and any of Junior Stock, a liquidating distribution in an amount equal to $100,000 per share, together with an amount equal to all dividends, if any, that have been declared but not paid prior to the date of payment of such distribution (but without any accumulation in respect of dividends that have not been declared prior to such payment date). Holders of the Series N will not be entitled to any other amounts from the Corporation after they have received their full liquidation preference.
The Series N may be fully subordinated to interests held by the U.S. government in the event of a receivership, insolvency, liquidation, or similar proceeding, including a proceeding under the “orderly liquidation authority” provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, as amended.
(b) Partial Payment. If in any distribution described in Section 5(a) above the assets of the Corporation or proceeds thereof are not sufficient to pay the Liquidation Preference (as defined below) in full to all holders of Series N and all holders of any stock of the Corporation ranking equally with the Series N as to such distribution, the amounts paid to the holders of Series N and to the holders of all such other stock shall be paid pro rata in accordance with the respective aggregate Liquidation Preference of the holders of Series N and the holders of all such other stock. In any such distribution, the “Liquidation Preference” of any holder of preferred stock of the Corporation shall mean the amount otherwise payable to such holder in such distribution (assuming no limitation on the assets of the Corporation available for such distribution), including an amount equal to any declared but unpaid dividends (and, in the case of any holder of stock other than Series N and on which dividends accrue on a cumulative basis, an amount equal to any unpaid, accrued, cumulative dividends, whether or not declared, as applicable). Holders of the Series N will not be entitled to any other amounts from the Corporation after they have received the full amounts provided for in this Section 5 and will have no right or claim to any of the Corporation’s remaining assets.
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(c) Residual Distributions. If the Liquidation Preference has been paid in full to all holders of Series N and any other shares of the Corporation’s stock ranking equally as to the Liquidation Preference, the holders of other stock of the Corporation ranking junior as to the Liquidation Preference shall be entitled to receive all remaining assets of the Corporation (or proceeds thereof) according to their respective rights and preferences.
(d) Merger, Consolidation and Sale of Assets Not Liquidation. For purposes of this Section 5, the merger or consolidation of the Corporation with or into any other corporation or other entity, including a merger or consolidation in which the holders of Series N receive cash, securities or other property for their shares, or the sale, lease or exchange (for cash, securities or other property) of all or substantially all of the assets of the Corporation, shall not constitute a liquidation, dissolution or winding up of the Corporation.
6. Redemption.
(a) Optional Redemption. The Corporation may, at its option, redeem the Series N (i) in whole or in part, from time to time, on any Dividend Payment Date after October 2, 2025 or (ii) in whole but not in part at any time within 90 days following a Regulatory Capital Treatment Event (as defined below), in each case upon notice given as provided in Section 6(c) below, at a redemption price equal to $100,000 per share, together with (except as otherwise provided herein below) any declared and unpaid dividends to, but excluding, the date fixed for redemption, without accumulation of any undeclared dividends. The redemption price for any shares of Series N shall be payable on the redemption date to the holder of such shares against surrender of the certificate(s) evidencing such shares to the Corporation or its agent. Any declared and unpaid dividend for the then current Dividend Period payable on a redemption date that occurs subsequent to the Dividend Record Date for a Dividend Period shall not be paid to the holder entitled to receive the redemption price on the redemption date, but rather shall be paid to the holder of record of the redeemed shares on such Dividend Record Date relating to the Dividend Payment Date as provided in Section 4 above.
A “Regulatory Capital Treatment Event” means the good faith determination by the Corporation that, as a result of (i) any amendment to, or change in, the laws or regulations of the United States or any political subdivision of or in the United States that is enacted or becomes effective after the Original Issue Date, (ii) any proposed change in those laws or regulations that is announced or becomes effective after the Original Issue Date, or (iii) any official administrative decision or judicial decision or administrative action or other official pronouncement interpreting or applying those laws or regulations that is announced after the Original Issue Date, there is more than an insubstantial risk that the Corporation will not be entitled to treat the full liquidation preference amount of $100,000 per share of Series N then outstanding as “Additional Tier 1” capital (or its equivalent) for purposes of the capital adequacy guidelines of the Federal Reserve Board (or, as and if applicable, the capital adequacy guidelines or regulations of any successor appropriate federal banking agency) as then in effect and applicable, for so long as any share of Series N is outstanding. “Appropriate federal banking agency” means the “appropriate federal banking agency” with respect to the Corporation as that term is defined in Section 3(q) of the Federal Deposit Insurance Act or any successor provision.
(b) No Sinking Fund. The Series N will not be subject to any mandatory redemption, sinking fund or other similar provisions. Holders of Series N will have no right to require the redemption or repurchase of any shares of Series N.
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(c) Notice of Redemption. Notice of every redemption of shares of Series N shall be given by first class mail, postage prepaid, addressed to the holders of record of the shares to be redeemed at their respective last addresses appearing on the books of the Corporation. Such mailing shall be not less than 30 days nor more than 60 days before the date fixed for redemption, provided that, if the depositary shares representing the Series N are held in book-entry form through The Depository Trust Company (“DTC”), the Corporation may give such notice in any manner permitted by DTC. Any notice mailed as provided in this Subsection shall be conclusively presumed to have been duly given, whether or not the holder receives such notice, but failure to duly give such notice by mail, or any defect in such notice or in the mailing thereof, to any holder of shares of Series N designated for redemption shall not affect the validity of the proceedings for the redemption of any other shares of Series N. Each such notice given to a holder shall state: (1) the redemption date; (2) the number of shares of Series N 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; and (4) the place or places where certificates for such shares are to be surrendered for payment of the redemption price.
(d) Regulatory Approval. Any redemption of the Series N is subject to the Corporation’s receipt of required prior approval, if any, by the Federal Reserve Board (or any successor appropriate federal banking agency), and to the satisfaction of conditions, if any, set forth in the capital adequacy guidelines of the Federal Reserve Board (or, as and if applicable, the capital adequacy guidelines or regulations of any successor appropriate federal banking agency) applicable to the redemption of the Series N.
(e) Partial Redemption. In case of any redemption of only part of the shares of Series N at the time outstanding, the shares to be redeemed shall be selected pro rata, provided that, if the depositary shares representing the Series N are held in book-entry form through DTC, the shares of Series N to be redeemed shall be selected in accordance with DTC procedures. Subject to the provisions hereof, the Corporation shall have full power and authority to prescribe the terms and conditions upon which shares of Series N shall be redeemed from time to time. If fewer than all the shares represented by any certificate are redeemed, a new certificate shall be issued representing the unredeemed shares without charge to the holder thereof.
(f) Effectiveness of Redemption. If notice of redemption has been duly given and if on or prior to the redemption date specified in the notice all funds necessary for the redemption have been set aside by the Corporation, separate and apart from its other funds, in trust for the pro rata benefit of the holders of any shares of Series N so called for redemption, so as to be and continue to be available therefor, then, notwithstanding that any certificate for any share so called for redemption has not been surrendered for cancellation, on and after the redemption date dividends shall cease to accrue on all shares so called for redemption, all shares so called for redemption shall no longer be deemed outstanding and all rights with respect to such shares shall forthwith on such redemption date cease and terminate, except only the right of the holders thereof to receive the amount payable on such redemption, without interest. Any funds unclaimed at the end of two years from the redemption date shall, to the extent permitted by law, be released to the Corporation, after which time the holders of the shares so called for redemption shall look only to the Corporation for payment of the redemption price of such shares.
7. Voting Rights.
(a) General. The holders of Series N shall not have any voting rights except as set forth below and as determined by the Board of Directors or an authorized
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committee thereof or as otherwise from time to time required by law. For the avoidance of doubt, the shares of Series N shall not be entitled to vote generally in the election of directors, including following Nonpayment events.
(b) Right To Elect Two Directors Upon Nonpayment Events. If and whenever dividends on any shares of the Series N, or any other Voting Preferred Stock, shall have not been declared and paid for the equivalent of three semi-annual or six quarterly full dividend payments, whether or not for consecutive Dividend Periods (a “Nonpayment”), the holders of such shares, voting together as a class with holders of any and all other series of Voting Preferred Stock then outstanding, will be entitled to vote for the election of a total of two additional members of the Board of Directors (the “Preferred Stock Directors”), provided that the election of any such directors shall not cause the Corporation to violate the corporate governance requirements of the New York Stock Exchange (or any other exchange on which the Corporation’s Common Stock may be listed) that listed companies must have a majority of independent directors and provided further that the Board of Directors shall at no time include more than two Preferred Stock Directors (to the extent that such requirements are then applicable to the Corporation). In that event, the number of directors on the Board of Directors shall automatically increase by two, and the new directors shall be elected at a special meeting called at the request of the holders of record of at least 20% of the then outstanding shares of Series N or of any other series of Voting Preferred Stock (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the stockholders, in which event such election shall be held at such next annual or special meeting of stockholders), and at each subsequent annual meeting. Such request to call a special meeting for the initial election of the Preferred Stock Directors after a Nonpayment shall be made by written notice, signed by the requisite holders of Series N or other Voting Preferred Stock, and delivered to the Secretary of the Corporation in such manner as provided for in Section 9 below, or as may otherwise be required by law. The voting rights will continue until dividends on the shares of the Series N and any such series of Voting Preferred Stock shall have been fully paid (or declared and a sum sufficient for the payment of such dividends shall have been set aside for such payment) for at least the equivalent of two consecutive semi-annual Dividend Periods or four consecutive quarterly Dividend Periods following the Nonpayment.
If and when dividends for at least the equivalent of two consecutive semi-annual Dividend Periods or four consecutive quarterly Dividend Periods following a Nonpayment have been fully paid (or declared and a sum sufficient for such payment shall have been set aside) on the Series N and any other class or series of Voting Preferred Stock, the holders of the Series N and all other holders of Voting Preferred Stock shall be divested of the foregoing voting rights (subject to revesting in the event of each subsequent Nonpayment), the term of office of each Preferred Stock Director so elected shall terminate and the number of directors on the Board of Directors shall automatically decrease by two. In determining whether dividends have been paid for at least the equivalent of two consecutive semi-annual Dividend Periods or four consecutive quarterly Dividend Periods following a Nonpayment, the Corporation may take account of any dividend payment (at the same rate and amount otherwise payable on the Series N) it elects to pay for any dividend period after the regular dividend date for that period has passed. Any Preferred Stock Director may be removed at any time without cause by the holders of record of a majority of the outstanding shares of the Series N together with all series of Voting Preferred Stock then outstanding (voting together as a single class) to the extent such holders have the voting rights described above. So long as a Nonpayment shall continue, any vacancy in the office of a Preferred Stock Director (other than prior to the initial election after a Nonpayment) may be filled by the written consent of the Preferred Stock Director remaining in office, or if none remains in office, by a vote of the holders of record of a majority of the
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outstanding shares of Series N and all Voting Preferred Stock when they have the voting rights described above (voting together as a single class); provided that the filling of each vacancy shall not cause the Corporation to violate the corporate governance requirements of the New York Stock Exchange (or any other exchange on which the Corporation’s Common Stock may be listed) that listed companies must have a majority of independent directors (to the extent such requirements are then applicable to the Corporation). Any such vote to remove, or to fill a vacancy in the office of, a Preferred Stock Director may be taken only at a special meeting called at the request of the holders of record of at least 20% of the Series N or of any other series of Voting Preferred Stock (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the stockholders, in which event such election shall be held at such next annual or special meeting of stockholders). The Preferred Stock Directors shall each be entitled to one vote per director on any matter.
(c) Other Voting Rights. So long as any shares of Series N are outstanding, in addition to any other vote or consent of stockholders required by law or by the Certificate of Incorporation, the vote or consent of the holders of at least two-thirds of the shares of Series N and any Voting Preferred Stock at the time outstanding and entitled to vote thereon, voting together as a single class, given in person or by proxy, either in writing without a meeting (to the extent permitted by the procedures for voting and consents in Section 7(f) below) or by vote at any meeting called for the purpose, shall be necessary for effecting or validating:
(i) Authorization of Senior Stock. Any amendment or alteration of the provisions of the Certificate of Incorporation or this Certificate of Designation to authorize or create, or increase the authorized amount of, any shares of any class or series of stock of the Corporation ranking senior to the Series N with respect to the payment of dividends or the distribution of assets upon any liquidation, dissolution or winding up of the Corporation;
(ii) Amendment of Series N. Any amendment, alteration or repeal of any provision of the Certificate of Incorporation or this Certificate of Designation, whether by merger, consolidation or otherwise, so as to materially and adversely affect the special rights, preferences, privileges and voting powers of the Series N, taken as a whole; or
(iii) Share Exchanges, Reclassifications, Mergers and Consolidations. Any consummation of a binding share exchange or reclassification involving the Series N, or of a merger or consolidation of the Corporation with another entity, unless in each case (x) the shares of Series N remain outstanding or, in the case of any such merger or consolidation with respect to which the Corporation is not the surviving or resulting entity, are converted into or exchanged for preference securities of the surviving or resulting entity or its ultimate parent, and (y) such shares remaining outstanding or such preference securities, as the case may be, have such rights, preferences, privileges and voting powers, and limitations and restrictions thereof, taken as a whole, as are not materially less favorable to the holders thereof than the rights, preferences, privileges and voting powers of the Series N, taken as a whole;
provided, however, that for all purposes of this Section 7(c), any increase in the amount of the authorized or issued Series N, Series A, Series C, Series E, Series F, Series H, Series I, Series J, Series K, Series L or Series M, or the creation and issuance, or an increase in the authorized or issued amount, of any other class or series of Preferred Stock ranking equally with the Series N with respect to the payment of dividends (whether such dividends are cumulative or non-cumulative) and the distribution of
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assets upon liquidation, dissolution or winding up of the Corporation will not be deemed to adversely affect the rights, preferences, privileges or voting powers of, and will not require the affirmative vote or consent of, the holders of outstanding shares of Series N.
If any amendment, alteration, repeal, share exchange, reclassification, merger or consolidation specified in this Section 7(c) would adversely affect one or more but not all other series of Voting Preferred Stock (including the Series N for this purpose), then only such series of Preferred Stock as are adversely affected by and entitled to vote on the matter shall vote on the matter together as a class in lieu of all other series of Preferred Stock. If all series of Preferred Stock are not equally affected by the proposed amendment, alteration, repeal, share exchange, reclassification, merger or consolidation described above, there shall be required a two-thirds approval of the class and two-thirds approval of each series that will have a diminished status.
(d) Changes for Clarification. Without the consent of the holders of the Series N, so long as such action does not adversely affect the rights, preferences, privileges and voting powers, and limitations and restrictions thereof, of the Series N, the Corporation may amend, alter, supplement or repeal any terms of the Series N to cure any ambiguity, or to cure, correct or supplement any provision contained in this Certificate of Designation that may be defective or inconsistent.
(e) Changes after Provision for Redemption. No vote or consent of the holders of Series N shall be required pursuant to Section 7(b), (c) or (d) above if, at or prior to the time when the act with respect to which any such vote or consent would otherwise be required pursuant to such Section, all outstanding shares of Series N shall have been redeemed, or shall have been called for redemption upon proper notice and sufficient funds shall have been set aside for such redemption, in each case pursuant to Section 6 above.
(f) Procedures for Voting and Consents. The rules and procedures for calling and conducting any meeting of the holders of Series N (including, without limitation, the fixing of a record date in connection therewith), the solicitation and use of proxies at such a meeting, the obtaining of written consents and any other aspect or matter with regard to such a meeting or such consents shall be governed by any rules the Board of Directors or a duly authorized committee of the Board of Directors, in its discretion, may adopt from time to time, which rules and procedures shall conform to the requirements of the Certificate of Incorporation, the Bylaws, applicable law and any national securities exchange or other trading facility on which the Series N is listed or traded at the time. Whether the vote or consent of the holders of a plurality, majority or other portion of the shares of Series N and any Voting Preferred Stock has been cast or given on any matter on which the holders of shares of Series N are entitled to vote shall be determined by the Corporation by reference to the specified liquidation amounts of the shares voted or covered by the consent.
8. Record Holders. To the fullest extent permitted by applicable law, the Corporation and the transfer agent for the Series N may deem and treat the record holder of any share of Series N as the true and lawful owner thereof for all purposes, and neither the Corporation nor such transfer agent shall be affected by any notice to the contrary.
9. Notices. All notices or communications in respect of Series N shall be sufficiently given if given in writing and delivered in person or by first class mail, postage prepaid, or if given in such other manner as may be permitted in this Certificate of Designation, in the Certificate of Incorporation or Bylaws or by applicable law.
13
10. No Conversion Rights. The Series N will not be convertible into, or exchangeable for, shares of any other class or series of stock or other securities of the Corporation.
11. No Preemptive Rights. No share of Series N shall have any rights of preemption whatsoever as to any securities of the Corporation, or any warrants, rights or options issued or granted with respect thereto, regardless of how such securities, or such warrants, rights or options, may be designated, issued or granted.
12. Other Rights. The shares of Series N shall not have any voting powers, preferences or relative, participating, optional or other special rights, or qualifications, limitations or restrictions thereof, other than as set forth herein or in the Certificate of Incorporation or as provided by applicable law.
13. Effectiveness. This Certificate of Designation shall become effective as of October 2, 2020.
14
In Witness Whereof, Morgan Stanley has caused this certificate to be signed by Kevin Sheehan, its Assistant Treasurer, this 1st day of October, 2020.
| MORGAN STANLEY | |||
| By | /s/ Kevin Sheehan | ||
| Name: Kevin Sheehan | |||
| Title: Assistant Treasurer | |||
Exhibit 4.3
Unless this certificate is presented by an authorized representative of The Depository Trust Company (55 Water Street, New York, New York) to the issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or such other name as requested by an authorized representative of The Depository Trust Company and any payment is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.
FIXED-TO-FLOATING RATE NON-CUMULATIVE PREFERRED STOCK, SERIES M ($1,000 LIQUIDATION PREFERENCE)
| NUMBER | SHARES | ||
| 1 | |||
| CUSIP |
MORGAN STANLEY
INCORPORATED UNDER THE LAWS OF THE STATE
OF DELAWARE
THIS CERTIFICATE IS TRANSFERABLE
IN THE CITY OF NEW YORK, NEW YORK
This is to certify that Cede & Co. is the registered owner of fully paid and non-assessable shares of Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series M, $0.01 par value, liquidation preference $1,000 per share, of Morgan Stanley (the “Corporation”) (the “Stock”), transferable on the books of the Corporation by the holder hereof in person or by duly authorized attorney upon surrender of this certificate properly endorsed.
This certificate is not valid unless countersigned
and registered by the Transfer Agent and Registrar.
Witness the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers.
Dated: October , 2020
| [SEAL] | ||
| Countersigned and Registered The Bank of New York Mellon Transfer Agent, Dividend Disbursement Agent and Registrar | ||||||
| By: | ||||||
MORGAN STANLEY
MORGAN STANLEY (the “Corporation”) will furnish, without charge to each stockholder who so requests, a copy of the certificate of designation establishing the powers, preferences and relative, participating, optional or other special rights of each class of stock of the Corporation or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights applicable to each class of stock of the Corporation or series thereof. Such information may be obtained by a request in writing to the Secretary of the Corporation at its principal place of business.
This certificate and the share or shares represented hereby are issued and shall be held subject to all of the provisions of the Corporation’s Amended and Restated Certificate of Incorporation, as amended, and the Certificate of Designation of Preferences and Rights of the Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series M (Liquidation Preference $1,000 per share) (copies of which are on file with the Transfer Agent), to all of which the holder, by acceptance hereof, assents.
The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full to applicable laws or regulations:
| TEN COM - as tenants in common | UNIF GIFT MIN ACT- | ______ | Custodian | _____ | |||||
| TEN ENT - as tenants by the entireties | (Minor) | (Cust) | |||||||
| JT TEN - as joint tenants with right of survivorship and not as tenants in common | under Uniform Gifts to Minors Act _______________________ (State) | ||||||||
Additional abbreviations may also be used though not in the above list.
___________________________
For value received, ________________ hereby sell(s), assign(s) and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER
IDENTIFYING NUMBER OF ASSIGNEE
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE
| ________________________________________________________________________ shares |
of the capital stock represented by the within certificate, and do(es) hereby irrevocably constitute and appoint _______________________, Attorney to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises.
Dated__________________
| Signature |
| NOTICE: | The signature to this assignment must correspond with the name as written upon the face of this certificate in every particular, without alteration or enlargement or any change whatever. |
| SIGNATURE GUARANTEED | |
NOTICE: The signature(s) should be
guaranteed by an eligible guarantor
institution (banks, stockbrokers, savings
and loan associations, and credit unions
with membership in an approved signature
guarantee medallion program), pursuant to
Rule 17Ad-15 under the Securities
Exchange Act of 1934.
Exhibit 4.4
FIXED-TO-FLOATING RATE NON-CUMULATIVE PREFERRED STOCK, SERIES N ($100,000 LIQUIDATION PREFERENCE)
| NUMBER | SHARES | ||
| 1 | |||
| CUSIP |
MORGAN STANLEY
INCORPORATED UNDER THE LAWS OF THE STATE
OF DELAWARE
THIS CERTIFICATE IS TRANSFERABLE
IN THE CITY OF NEW YORK, NEW YORK
This is to certify that The Bank of New York Mellon, as Depositary under the Deposit Agreement, dated as of October , 2020, among Morgan Stanley (the “Corporation”), The Bank of New York Mellon, and the holders from time to time of the Depositary Receipts issued thereunder, is the owner of fully paid and non-assessable shares of Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series N, $0.01 par value, liquidation preference $100,000 per share, of the Corporation (the “Stock”), transferable on the books of the Corporation by the holder hereof in person or by duly authorized attorney upon surrender of this certificate properly endorsed.
This certificate is not valid unless countersigned
and registered by the Transfer Agent and Registrar.
Witness the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers.
Dated: October , 2020
| [SEAL] | ||
| Countersigned and Registered The Bank of New York Mellon Transfer Agent, Dividend Disbursement Agent and Registrar | ||||||
| By: | ||||||
MORGAN STANLEY
MORGAN STANLEY (the “Corporation”) will furnish, without charge to each stockholder who so requests, a copy of the certificate of designation establishing the powers, preferences and relative, participating, optional or other special rights of each class of stock of the Corporation or series thereof and the qualifications, limitations or restrictions of such preferences and/or rights applicable to each class of stock of the Corporation or series thereof. Such information may be obtained by a request in writing to the Secretary of the Corporation at its principal place of business.
This certificate and the share or shares represented hereby are issued and shall be held subject to all of the provisions of the Corporation’s Amended and Restated Certificate of Incorporation, as amended, and the Certificate of Designation of Preferences and Rights of the Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series N (Liquidation Preference $100,000 per share) (copies of which are on file with the Transfer Agent), to all of which the holder, by acceptance hereof, assents.
The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full to applicable laws or regulations:
| TEN COM - as tenants in common | UNIF GIFT MIN ACT- | ______ | Custodian | _____ | |||||
| TEN ENT - as tenants by the entireties | (Minor) | (Cust) | |||||||
| JT TEN - as joint tenants with right of survivorship and not as tenants in common | under Uniform Gifts to Minors Act _______________________ (State) | ||||||||
Additional abbreviations may also be used though not in the above list.
___________________________
For value received, ________________ hereby sell(s), assign(s) and transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER
IDENTIFYING NUMBER OF ASSIGNEE
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE
| ________________________________________________________________________ shares |
of the capital stock represented by the within certificate, and do(es) hereby irrevocably constitute and appoint _______________________, Attorney to transfer the said stock on the books of the within named Corporation with full power of substitution in the premises.
Dated__________________
| Signature |
| NOTICE: | The signature to this assignment must correspond with the name as written upon the face of this certificate in every particular, without alteration or enlargement or any change whatever. |
| SIGNATURE GUARANTEED | |
NOTICE: The signature(s) should be
guaranteed by an eligible guarantor
institution (banks, stockbrokers, savings
and loan associations, and credit unions
with membership in an approved signature
guarantee medallion program), pursuant to
Rule 17Ad-15 under the Securities
Exchange Act of 1934.
Exhibit 4.5
MORGAN STANLEY,
THE BANK OF NEW YORK MELLON
AND
THE HOLDERS FROM TIME TO TIME OF
THE DEPOSITARY RECEIPTS DESCRIBED HEREIN
DEPOSIT AGREEMENT
Dated as of October 2, 2020
TABLE OF CONTENTS
Page
Article
1
Definitions
| Section 1.01. Definitions | 1 |
| Article 2 | |
| Form of Receipts, Deposit of Stock, Execution and Delivery, Transfer, Surrender and Redemption of Receipts | |
| Section 2.01. Form and Transfer of Receipts. | 3 |
| Section 2.02. Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof | 4 |
| Section 2.03. Registration of Transfer of Receipts | 4 |
| Section 2.04. Split-ups and Combinations of Receipts; Surrender of Receipts and Withdrawal of Stock | 5 |
| Section 2.05. Limitations on Execution and Delivery, Transfers, Surrender and Exchange of Receipts | 6 |
| Section 2.06. Lost Receipts, Etc | 6 |
| Section 2.07. Optional Redemption of Stock | 7 |
| Section 2.08. Cancellation and Destruction of Surrendered Receipts | 8 |
| Section 2.09. Receipts Issuable in Global Registered Form. | 8 |
| Article 3 | |
| Certain Obligations of Holders of Receipts and the Company | |
| Section 3.01. Filing Proofs, Certificates and Other Information | 10 |
| Section 3.02. Payment of Taxes or Other Governmental Charges | 10 |
| Section 3.03. Warranty as to Stock | 10 |
| Article 4 | |
| The Deposited Securities; Notices | |
| Section 4.01. Cash Distributions | 10 |
| Section 4.02. Distributions Other Than Cash, Rights, Preferences or Privileges | 11 |
| Section 4.03. Subscription Rights, Preferences or Privileges | 12 |
| Section 4.04. Notice of Dividends, Etc.; Fixing Record Date for Holders of Receipts | 13 |
| Section 4.05. Voting Rights | 13 |
| Section 4.06. Changes Affecting Deposited Securities and Reclassifications, Recapitalizations, Etc | 24 |
| Section 4.07. [Reserved] | 14 |
| Section 4.08. Lists of Receipt Holders | 14 |
| Article 5 | |
| The Depositary, the Depositary’s Agents, the Registrar and the Company | 15 |
| Section 5.01. Maintenance of Offices, Agencies and Transfer Books by the Depositary; Registrar | 15 |
| Section 5.02. Prevention of or Delay in Performance by the Depositary or the Company | 16 |
| Section 5.03. Obligation of the Depositary and the Company | 18 |
| Section 5.04. Resignation and Removal of the Depositary; Appointment of Successor Depositary | 19 |
| Section 5.05. Corporate Reports | 19 |
| Section 5.06. Indemnification | 19 |
| Section 5.07. Charges and Expenses | |
| Article 6 | |
| Amendment and Termination | |
| Section 6.01. Amendment | 20 |
| Section 6.02. Termination | 20 |
| Article 7 | |
| Miscellaneous | |
| Section 7.01. Counterparts | 22 |
| Section 7.02. Exclusive Benefit of Parties | 22 |
| Section 7.03. Invalidity of Provisions | 22 |
| Section 7.04. Notices | 23 |
| Section 7.05. Depositary’s Agents | 23 |
| Section 7.06. Appointment of Registrar and Transfer Agent in respect of the Depositary Shares and Receipts | 24 |
| Section 7.07. Appointment of Registrar and Transfer Agent in respect of the Stock | 24 |
| Section 7.08. Appointment of Calculation Agent | 24 |
| Section 7.09. Waiver of Jury Trial | 24 |
| Section 7.10. Holders of Receipts Are Parties | 25 |
| Section 7.11. Governing Law and Submission to Jurisdiction | 25 |
| Section 7.12. Inspection of Deposit Agreement | 25 |
| Section 7.13. Headings | 25 |
EXHIBIT A – Form of Receipt
EXHIBIT B
DEPOSIT AGREEMENT dated as of October 2, 2020, among MORGAN STANLEY, a Delaware corporation, THE BANK OF NEW YORK MELLON, a New York banking corporation, and the holders from time to time of the Receipts described herein.
WHEREAS, it is desired to provide as hereinafter set forth in this Deposit Agreement, for the deposit from time to time of shares of Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series N (the “Stock”), par value $0.01 per share, liquidation preference $100,000 per share, of Morgan Stanley with the Depositary for the purposes set forth in this Deposit Agreement and for the issuance hereunder of Receipts evidencing Depositary Shares in respect of the Stock so deposited; and
WHEREAS, the Receipts are to be substantially in the form of Exhibit A annexed hereto, with appropriate insertions, modifications and omissions, as hereinafter provided in this Deposit Agreement;
NOW, THEREFORE, in consideration of the premises, the parties hereto agree as follows:
Article
1
Definitions
Section 1.01. Definitions. The following definitions shall for all purposes, unless otherwise indicated, apply to the respective terms used in this Deposit Agreement:
“Certificate” shall mean the Certificate of Designation of Preferences and Rights filed or to be filed with the Secretary of State of the State of Delaware establishing the Stock as a series of preferred stock of the Company.
“Company” shall mean Morgan Stanley, a Delaware corporation, and its successors.
“Deposit Agreement” shall mean this Deposit Agreement, as amended or supplemented from time to time in accordance with the terms hereof.
“Depositary” shall mean The Bank of New York Mellon, or any successor as Depositary hereunder.
“Depositary Shares” shall mean the depositary shares, each representing 1/100th of a share of Stock and evidenced by a Receipt.
“Depositary’s Agent” shall mean an agent appointed by the Depositary pursuant to Section 7.05.
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“Depositary’s Office” shall mean the principal corporate trust office of the Depositary in New York City, at which at any particular time its corporate trust business shall be administered.
“Exchange Event” means, with respect to the Global Registered Receipt, (A) the Global Receipt Depository which is the holder of such Global Registered Receipt or Receipts notifies the Company that it is no longer willing or able to properly discharge its responsibilities under the Letter of Representations or that it is no longer eligible or in good standing under the Securities Exchange Act of 1934, as amended, and (B) the Company has not appointed a qualified successor Global Receipt Depository within ninety (90) calendar days after the Company received such notice.
“Global Receipt Depository” means, with respect to any Receipt issued hereunder, The Depository Trust Company (“DTC”) or such other successor entity designated as Global Receipt Depository by the Company in or pursuant to this Deposit Agreement, which Person must be, to the extent required by any applicable law or regulation, a clearing agency registered under the Securities Exchange Act of 1934, as amended.
“Global Registered Receipt” means, with respect to the Depositary Shares, a global registered Receipt registered in the name of a nominee of the Global Receipt Depository.
“Letter of Representations” means the applicable agreement among the Company and a Global Receipt Depository with respect to such Global Receipt Depository’s rights and obligations with respect to the Global Registered Receipts, as the same may be amended, supplemented, restated or otherwise modified from time to time and any successor agreement thereto.
“Holder,” “holder” or “record holder,” as applied to a Receipt shall mean the person in whose name a Receipt is registered on the books of the Depositary maintained for such purpose.
“Receipt” shall mean one of the depositary receipts, substantially in the form set forth as Exhibit A hereto, issued hereunder, and evidencing the number of Depositary Shares held of record by the holder of such Depositary Shares.
“Redemption Date” has the meaning set forth in Section 2.07.
“Registrar” shall mean the Depositary or such other successor bank or trust company that shall be appointed by the Depositary with the approval of the Company, to register ownership and transfers of Receipts as herein provided, and if a Registrar shall be so appointed, references herein to “the books” of or maintained by the Depositary shall be deemed, as applicable, to refer as well to the register maintained by such Registrar for such purpose.
“Securities Act” shall mean the Securities Act of 1933, as amended.
2
“Stock” shall mean shares of the Company’s Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series N, par value $0.01 per share, liquidation preference $100,000 per share.
Article
2
Form of Receipts, Deposit of Stock, Execution and Delivery, Transfer, Surrender and Redemption of Receipts
Section 2.01. Form and Transfer of Receipts. Receipts shall be substantially in the form set forth in Exhibit A to this Deposit Agreement, with appropriate insertions, modifications and omissions, as hereinafter provided.
Receipts shall be executed by the Depositary by the manual or facsimile signature of a duly authorized officer of the Depositary and, if a Registrar for the Receipts shall have been appointed, countersigned by a duly authorized officer of the Registrar; provided that no Receipt shall be entitled to any benefits under this Deposit Agreement or be valid or obligatory for any purpose unless it shall have been executed manually or by facsimile by a duly authorized officer of the Depositary or, if a Registrar for the Receipts shall have been appointed, by manual or facsimile signature of a duly authorized officer of the Depositary and countersigned by the manual or facsimile signature of a duly authorized officer of such Registrar; provided further that any such signature or countersignature may be entered electronically. The Depositary shall record on its books each Receipt so signed and delivered as hereinafter provided.
A Receipt may evidence any whole number of Depositary Shares.
Receipts may be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent with the provisions of this Deposit Agreement as may be required by the Depositary or required to comply with any applicable law or any regulation thereunder or with the rules and regulations of any securities exchange upon which the Stock, the Depositary Shares or the Receipts may be listed or to conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which any particular Receipts are subject.
Title to Depositary Shares evidenced by a Receipt that is properly endorsed or accompanied by a properly executed instrument of transfer shall be transferable by delivery with the same effect as in the case of a negotiable instrument; provided, however, that until transfer of a Receipt shall be registered on the books of the Depositary as provided in Section 2.03, the Depositary may, notwithstanding any notice to the contrary, treat the holder of record at such time as the absolute owner thereof for the purpose of determining the person entitled to distributions of dividends or other distributions or to any notice provided for in this Deposit Agreement and for all other purposes.
3
Section 2.02. Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof. Subject to the terms and conditions of this Deposit Agreement, the Company may from time to time deposit shares of Stock under this Deposit Agreement by delivery to the Depositary of a certificate or certificates for the Stock to be deposited, properly endorsed or accompanied, if required by the Depositary, by a duly executed instrument of transfer or endorsement, in form satisfactory to the Depositary, together with all such certifications as may be required by the Depositary in accordance with the provisions of this Deposit Agreement, and together with a written order of the Company directing the Depositary to execute and deliver to, or upon the written order of, the person or persons stated in such order a Receipt or Receipts for the number of Depositary Shares representing such deposited Stock.
Deposited Stock shall be held by the Depositary at the Depositary’s Office or at such other place or places as the Depositary shall determine.
Upon receipt by the Depositary of a certificate or certificates for Stock deposited in accordance with the provisions of this Section, together with the other documents required as above specified, and upon recordation of the Stock on the books of the Company (or its duly appointed transfer agent) in the name of the Depositary or its nominee, the Depositary, subject to the terms and conditions of this Deposit Agreement, upon payment of any applicable fees and expenses of the Depositary and any applicable taxes or governmental charges, shall execute and deliver, to or upon the order of the person or persons named in the written order delivered to the Depositary referred to in the first paragraph of this Section, a Receipt or Receipts for the number of Depositary Shares representing the Stock so deposited and registered in such name or names as may be requested by such person or persons. The Depositary shall execute and deliver such Receipt or Receipts at the Depositary’s Office or such other offices, if any, as the Depositary may designate. Delivery at other offices shall be at the risk and expense of the person requesting such delivery.
Notwithstanding the foregoing, pending preparation by the Company of definitive certificates for the Stock to be deposited, the Company may deliver temporary certificates for Stock that are printed, lithographed, typewritten, mimeographed or otherwise substantially of the tenor of the definitive certificates for Stock in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations as the Company may determine. If temporary certificates for Stock are delivered, the Company will cause definitive certificates for Stock to be prepared without unreasonable delay. After the preparation of definitive certificates for Stock, the temporary certificates for Stock shall be exchangeable for definitive certificates for Stock upon surrender of the temporary certificates for Stock at the Depositary’s Office, without charge to the Depositary.
Section 2.03. Registration of Transfer of Receipts. Subject to the terms and conditions of this Deposit Agreement, including payment of any applicable
4
fees and expenses of the Depositary and any applicable taxes or governmental charges as provided in Section 5.07, the Depositary shall register on its books from time to time transfers of Receipts upon any surrender thereof by the holder in person or by duly authorized attorney, properly endorsed or accompanied by a properly executed instrument of transfer. Thereupon the Depositary shall execute a new Receipt or Receipts evidencing the same aggregate number of Depositary Shares as those evidenced by the Receipt or Receipts surrendered and deliver such new Receipt or Receipts to or upon the order of the person entitled thereto.
The Depositary shall not be required (a) to issue, transfer or exchange any Receipts for a period beginning at the opening of business fifteen days next preceding any selection of Depositary Shares and Stock to be redeemed and ending at the close of business on the day of the mailing of notice of redemption, or (b) to transfer or exchange for another Receipt any Receipt called or being called for redemption in whole or in part except as provided in Section 2.07.
Section 2.04. Split-ups and Combinations of Receipts; Surrender of Receipts and Withdrawal of Stock. Upon surrender of a Receipt or Receipts at the Depositary’s Office or at such other offices as it may designate for the purpose of effecting a split-up or combination of such Receipt or Receipts, and subject to the terms and conditions of this Deposit Agreement, the Depositary shall execute and deliver a new Receipt or Receipts in the authorized denomination or denominations requested, evidencing the aggregate number of Depositary Shares evidenced by the Receipt or Receipts surrendered.
Any holder of a Receipt or Receipts representing any number of whole shares of Stock may withdraw the Stock and all money and other property, if any, represented thereby by surrendering such Receipt or Receipts at the Depositary’s Office or at such other offices as the Depositary may designate for such withdrawals. Upon payment of the fees of the Depositary for the withdrawal of Stock as provided in Section 5.07 and payment of all applicable taxes and governmental charges and without unreasonable delay, the Depositary shall deliver to such holder or to the person or persons designated by such holder as hereinafter provided, the number of whole shares of Stock and all money and other property, if any, represented by the Depositary Shares evidenced by the Receipt or Receipts so surrendered for withdrawal, but holders of such whole shares of Stock will not thereafter be entitled to deposit such Stock hereunder or to receive Depositary Shares therefor or a Receipt evidencing such Depositary Shares. If a Receipt delivered by the holder to the Depositary in connection with such withdrawal shall evidence a number of Depositary Shares in excess of the number of Depositary Shares representing the number of whole shares of Stock to be so withdrawn, the Depositary shall at the same time, in addition to such number of whole shares of Stock and such money and other property, if any, to be so withdrawn, deliver to such holder, or pursuant to his order, upon payment of the fees of the Depositary for the withdrawal of Stock as provided in Section 5.07 and payment of all taxes, a new Receipt evidencing such excess number of Depositary Shares. Delivery of the Stock and money and other property, if any,
5
being withdrawn may be made by the delivery of such certificates, documents of title and other instruments as the Depositary may deem appropriate.
If the Stock and the money and other property, if any, being withdrawn are to be delivered to a person or persons other than the holder of the Receipt or Receipts being surrendered for withdrawal of Stock, such holder shall execute and deliver to the Depositary a written order so directing the Depositary and the Depositary may require that the Receipt or Receipts surrendered by such holder for the withdrawal of such shares of Stock be properly endorsed in blank or accompanied by a properly executed instrument of transfer in blank.
Delivery of the Stock and the money and other property, if any, represented by Receipts surrendered for withdrawal shall be made by the Depositary at the Depositary’s Office, except that, at the request, risk and expense of the holder surrendering such Receipt or Receipts and for the account of the holder thereof, such delivery may be made at such other place as may be designated by such holder.
Section 2.05. Limitations on Execution and Delivery, Transfers, Surrender and Exchange of Receipts. As a condition precedent to the execution and delivery, registration of transfer, split-up, combination, surrender or exchange of any Receipt, the Depositary, any of the Depositary’s Agents or the Company may require payment to it of a sum sufficient for the payment (or, in the event that the Depositary or the Company shall have made such payment, the reimbursement to it) of any charges or expenses payable by the holder of a Receipt pursuant to Section 5.07, may require the production of evidence satisfactory to it as to the identity and genuineness of any signature and may also require compliance with such regulations, if any, as the Depositary or the Company may establish consistent with the provisions of this Deposit Agreement and/or applicable law.
The deposit of Stock may be refused, the delivery of Receipts against Stock may be suspended, the registration of transfer of Receipts may be refused and the registration of transfer, surrender or exchange of outstanding Receipts may be suspended (i) during any period when the register of stockholders of the Company is closed or (ii) if any such action is deemed necessary or advisable by the Depositary, any of the Depositary’s Agents or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission or under any provision of this Deposit Agreement.
Section 2.06. Lost Receipts, Etc. In case any Receipt shall be mutilated, destroyed, lost or stolen, the Depositary in its discretion may execute and deliver a Receipt of like form and tenor in exchange and substitution for such mutilated Receipt upon cancellation thereof, or in lieu of and in substitution for such destroyed, lost or stolen Receipt. Before the Depositary shall execute and deliver a new Receipt in substitution for a destroyed, lost or stolen Receipt, the holder thereof shall have (i) delivered to the Depositary (a) a request for such execution
6
and delivery prior to the Depositary having received notice that the Receipt has been acquired by a bona fide purchaser, (b) evidence satisfactory to the Depositary of such destruction, loss or theft of such Receipt and of ownership thereof and (c) indemnification satisfactory to the Depositary and (ii) satisfied any other reasonable requirements imposed by the Depositary.
Section 2.07. Optional Redemption of Stock. If the Company shall elect to redeem shares of Stock pursuant to the Certificate, it shall (unless otherwise agreed to in writing with the Depositary) give the Depositary not less than 35 days’ notice of the date of such proposed redemption of Stock, the number of shares of Stock held by the Depositary to be redeemed and the redemption price per share of Stock. The Depositary shall be fully protected and shall incur no liability in its reliance on the information contained in such notice and delivery of such notice to the Depositary shall be conclusive evidence of the permissibility and compliance of such redemption under the Certificate. On the date of such redemption, provided that the Company shall then have paid or caused to be paid in full to the Depositary the redemption price (determined pursuant to the Certificate) of the Stock deposited with the Depositary to be redeemed, the Depositary shall redeem (using the proceeds of such redemption) the Depositary Shares relating to such Stock. The Depositary shall mail, first class postage prepaid, notice of the Company’s redemption of Stock and the proposed simultaneous redemption of the Depositary Shares relating to the Stock to be redeemed, not less than 30 days and not more than 60 days prior to the date fixed for redemption of such Stock and Depositary Shares (the “Redemption Date”), to the holders of the Receipts evidencing the Depositary Shares to be so redeemed, at the addresses of such holders as the same appear on the records of the Depositary (provided that, if the Depositary Shares are held through DTC, the Depositary shall give such notice in accordance with the procedures of DTC); but neither failure to mail or otherwise give any such notice to one or more such holders nor any defect in any notice shall affect the sufficiency of the proceedings for redemption as to the other holders. The Company shall provide the Depositary with such notice, and each such notice shall state: (i) the Redemption Date; (ii) the number of Depositary Shares to be redeemed and, if fewer than all the Depositary Shares held by any holder are to be redeemed, the number of Depositary Shares held by such holder to be so redeemed; (iii) the redemption price and (iv) the place or places where Receipts evidencing Depositary Shares to be redeemed are to be surrendered for payment of the redemption price. In case fewer than all the outstanding Depositary Shares are to be redeemed, the Depositary Shares to be redeemed shall be selected pro rata (as nearly as may be) or by lot (provided that, if the Depositary Shares are held in book-entry form through DTC, the Depositary Shares to be redeemed shall be selected in accordance with DTC procedures).
Notice having been given by the Depositary as aforesaid, from and after the Redemption Date (unless the Company shall have failed to redeem the shares of Stock to be redeemed by it as set forth in the Company’s notice provided for in the preceding paragraph), the Depositary Shares called for redemption shall be
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deemed no longer to be outstanding and all rights of the holders of Receipts evidencing such Depositary Shares (except the right to receive the redemption price) shall, to the extent of such Depositary Shares, cease and terminate. Upon surrender in accordance with said notice of the Receipts evidencing such Depositary Shares (properly endorsed or assigned for transfer, if the Depositary shall so require), such Depositary Shares shall be redeemed at a redemption price per Depositary Share equal to one-one hundredth of the redemption price per share paid in respect of shares of Stock pursuant to the Certificate plus all money and other property, if any, represented by such Depositary Shares, including all amounts paid by the Company in respect of dividends that on the Redemption Date have accrued on the shares of Stock to be so redeemed and that have not theretofore been paid, after deduction of applicable fees, charges and expenses, if any. The foregoing shall be subject further to the terms and conditions of the Certificate.
If fewer than all of the Depositary Shares evidenced by a Receipt are called for redemption, the Depositary will deliver to the holder of such Receipt upon its surrender to the Depositary, together with payment of the redemption price for the Depositary Shares called for redemption, a new Receipt evidencing the Depositary Shares evidenced by such prior Receipt and not called for redemption.
Except as provided in the preceding paragraph of this Section 2.07, the Depositary shall not be required to transfer or exchange for another Receipt any Receipt evidencing Depositary Shares called or being called for redemption in whole or in part.
The Depositary shall notify the Company of any funds deposited by or for the account of the Company for the purpose of redeeming any Depositary Shares that the holders thereof have failed to redeem after two years from the date of such deposit, and remit such funds to the Company unless otherwise required by any applicable law or regulation. The Company acknowledges that thereafter it remains subject, pursuant to Section 2.07, to any payment obligations due to a Holder that surrenders Depositary Shares that were called for redemption pursuant to such Section and that the Depositary shall have no duty or obligation to pay that Holder, although the Depositary shall notify the Company of any surrender of that kind.
Section 2.08. Cancellation and Destruction of Surrendered Receipts. All Receipts surrendered to the Depositary or any Depositary’s Agent shall be cancelled by the Depositary. Except as prohibited by applicable law or regulation, the Depositary is authorized to destroy all Receipts so cancelled.
Section 2.09. Receipts Issuable in Global Registered Form. If the Company shall determine in a writing delivered to the Depositary that the Receipts are to be issued in whole or in part in the form of one or more Global Registered Receipts, then the Depositary shall, in accordance with the other
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provisions of this Deposit Agreement, execute and deliver one or more Global Registered Receipts evidencing the Receipts, which (i) shall represent, and shall be denominated in an amount equal to the aggregate liquidation preference of, the Receipts to be represented by such Global Registered Receipt or Receipts, and (ii) shall be registered in the name of the Global Receipt Depository therefor or its nominee.
Notwithstanding any other provision of this Deposit Agreement to the contrary, unless otherwise provided in a Global Registered Receipt, such Global Registered Receipt may only be transferred in whole and only by the Global Receipt Depository to its nominee, or by such nominee to the Global Receipt Depository or to another nominee of the Global Receipt Depository, or by the Global Receipt Depository or any nominee thereof to a successor Global Receipt Depository for the Global Registered Receipt selected or approved by the Company or to a nominee of the Global Receipt Depository. Except as provided below, owners solely of beneficial interests in a Global Registered Receipt shall not be entitled to receive physical delivery of the Receipts represented by such Global Registered Receipt. Neither any such beneficial owner nor any direct or indirect participant of a Global Receipt Depository shall have any rights under this Deposit Agreement with respect to any Global Registered Receipt held on their behalf by a Global Receipt Depository and such Global Receipt Depository may be treated by the Company, the Depositary and any director, officer, employee or agent of the Company or the Depositary as the holder of such Global Registered Receipt for all purposes whatsoever. Unless and until definitive Receipts are delivered to the owners of the beneficial interests in a Global Registered Receipt, (1) the Global Receipt Depository will make book-entry transfers among its participants and receive and transmit all payments and distributions in respect of Global Registered Receipts to such participants, in each case, in accordance with its applicable procedures and arrangements, and (2) whenever any notice, payment or other communication to the holders of Global Registered Receipts is required under this Deposit Agreement, the Company and the Depositary shall give all such notices, payments and communications specified herein to be given to such holders to the Global Receipt Depository.
If an Exchange Event has occurred with respect to any Global Registered Receipt, then, in any such event, the Depositary shall, upon receipt of a written order from the Company for the execution and delivery of individual definitive registered Receipts in exchange for such Global Registered Receipt, execute and deliver, individual definitive registered Receipts, in authorized denominations and of like tenor and terms in an aggregate liquidation preference equal to the liquidation preference of the Global Registered Receipt in exchange for such Global Registered Receipt.
Definitive registered Receipts issued in exchange for a Global Registered Receipt pursuant to this Section shall be registered in such names and in such authorized denominations as the Global Receipt Depository, pursuant to instructions from its participants, shall instruct the Depositary in writing. The
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Depositary shall deliver such Receipts to the persons in whose names such Receipts are so registered.
Notwithstanding anything to the contrary in this Deposit Agreement, should the Company determine that the Receipts should be issued as a Global Registered Receipt, or that a Global Registered Receipt should be issued in exchange for definitive registered Receipts, the parties hereto shall comply with the terms of the Letter of Representations.
Article
3
Certain Obligations of Holders of Receipts and the Company
Section 3.01. Filing Proofs, Certificates and Other Information. Any holder of a Receipt may be required from time to time to file such proof of residence, or other matters or other information, to execute such certificates and to make such representations and warranties as the Depositary or the Company may reasonably deem necessary or proper. The Depositary or the Company may withhold the delivery, or delay the registration of transfer, redemption or exchange, of any Receipt or the withdrawal of the Stock represented by the Depositary Shares evidenced by any Receipt or the distribution of any dividend or other distribution or the sale of any property or rights or of the proceeds thereof until such proof or other information is filed or such certificates are executed or such representations and warranties are made.
Section 3.02. Payment of Taxes or Other Governmental Charges. Holders of Receipts shall be obligated to make payments to the Depositary of certain charges and expenses, as provided in Section 5.07. Registration of transfer of any Receipt or any withdrawal of Stock and all money or other property, if any, represented by the Depositary Shares evidenced by such Receipt may be refused until any such payment due is made, and any dividends, interest payments or other distributions may be withheld or any part of or all the Stock or other property represented by the Depositary Shares evidenced by such Receipt and not theretofore sold may be sold for the account of the holder thereof (after attempting by reasonable means to notify such holder prior to such sale), and such dividends, interest payments or other distributions or the proceeds of any such sale may be applied to any payment of such charges or expenses, the holder of such Receipt remaining liable for any deficiency.
Section 3.03. Warranty as to Stock. The Company hereby represents and warrants that the Stock, when issued, will be duly authorized, validly issued, fully paid and nonassessable. Such representation and warranty shall survive the deposit of the Stock and the issuance of Receipts.
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Article
4
The Deposited Securities; Notices
Section 4.01. Cash Distributions. Whenever the Depositary shall receive any cash dividend or other cash distribution on Stock, the Depositary shall, subject to Sections 3.01 and 3.02, distribute to holders of Receipts on the record date fixed pursuant to Section 4.04, upon payment of any applicable fees and expenses of the Depositary, as provided in Section 5.07 hereof, such amounts of such dividend or distribution as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders; provided, however, that in case the Company or the Depositary shall be required to withhold and shall withhold from any cash dividend or other cash distribution in respect of the Stock an amount on account of taxes, the amount made available for distribution or distributed in respect of Depositary Shares shall be reduced accordingly. The Depositary shall distribute or make available for distribution, as the case may be, only such amount, however, as can be distributed without attributing to any holder of Depositary Shares a fraction of one cent, and any balance not so distributable shall be held by the Depositary (without liability for interest thereon) and shall be added to and be treated as part of the next sum received by the Depositary for distribution to holders of Receipts then outstanding. In the event that definitive registered Receipts are issued, each holder of such a definitive registered Receipt shall provide the Depositary with a properly completed Form W-8 or W-9 (such Form W-9 shall contain the holder’s certified tax identification number, if required), as may be applicable. Each holder of a Receipt acknowledges that the Depositary may withhold such amounts as are required by law from any of the distributions to be made hereunder.
Section 4.02. Distributions Other Than Cash, Rights, Preferences or Privileges. Whenever the Depositary shall receive any distribution other than cash, rights, preferences or privileges upon Stock, the Depositary shall, subject to Sections 3.01 and 3.02, upon payment of any applicable fees and expenses of the Depositary and any applicable taxes or governmental charges, distribute to holders of Receipts on the record date fixed pursuant to Section 4.04 such amounts of the securities or property received by it as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders, in any manner that the Depositary may deem equitable and practicable for accomplishing such distribution. If in the opinion of the Depositary such distribution cannot be made proportionately among such holders, or if for any other reason (including any requirement that the Company or the Depositary withhold an amount on account of taxes or governmental charges) the Depositary deems, after consultation with the Company, such distribution not to be feasible, the Depositary may, with the approval of the Company, adopt such method as it deems equitable and practicable for the purpose of effecting such distribution, including the sale (at public or private sale) of the securities or property thus received, or any part thereof, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Sections 3.01 and 3.02, be distributed or made available for distribution, as the
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case may be, by the Depositary to such holders of Receipts as provided by Section 4.01 in the case of a distribution received in cash. The Company shall not make any distribution of such securities unless the Company shall have provided an opinion of counsel stating that such securities have been registered under the Securities Act or do not need to be so registered.
Section 4.03. Subscription Rights, Preferences or Privileges. If the Company shall at any time offer or cause to be offered to the persons in whose names Stock is recorded on the books of the Company any rights, preferences or privileges to subscribe for or to purchase any securities or any rights, preferences or privileges of any other nature, such rights, preferences or privileges shall in each such instance be made available by the Depositary, upon payment of any applicable fees and expenses of the Depositary and any applicable taxes or governmental charges, to the holders of Receipts in such manner as the Depositary may determine, either by the issue to such holders of warrants representing such rights, preferences or privileges or by such other method as may be determined by the Depositary with the approval of the Company; provided, however, that (i) if at the time of issue or offer of any such rights, preferences or privileges the Depositary determines that it is not lawful or (after consultation with the Company) not feasible to make such rights, preferences or privileges available to holders of Receipts by the issue of warrants or otherwise, or (ii) if and to the extent so instructed by holders of Receipts who do not desire to exercise such rights, preferences or privileges, then the Depositary may (with approval of the Company in any case where the Depositary has determined that it is not feasible to make such rights, preferences or privileges available), if applicable laws or the terms of such rights, preferences or privileges permit such transfer, sell such rights, preferences or privileges at public or private sale, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Sections 3.01 and 3.02, be distributed by the Depositary to the holders of Receipts entitled thereto as provided by Section 4.01 in the case of a distribution received in cash.
If registration under the Securities Act of the securities to which any rights, preferences or privileges relate is required in order for holders of Receipts to be offered or sold the securities to which such rights, preferences or privileges relate, the Company agrees with the Depositary that it will promptly notify the Depositary of such requirement and will file promptly a registration statement pursuant to such Act with respect to such rights, preferences or privileges and securities and use its reasonable best efforts and take all steps available to it to cause such registration statement to become effective sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. In no event shall the Depositary make available to the holders of Receipts any right, preference or privilege to subscribe for or to purchase any securities unless and until such registration statement shall have become effective, or unless the offering and sale of such securities to such holders are exempt from registration under the provisions of the
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Securities Act and the Company shall have provided to the Depositary an opinion of counsel to such effect.
If any other action under the laws of any jurisdiction or any governmental or administrative authorization, consent or permit is required in order for such rights, preferences or privileges to be made available to holders of Receipts, the Company agrees with the Depositary that it will promptly notify the Depositary of such requirements and that the Company will use its reasonable best efforts to take such action or obtain such authorization, consent or permit sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges.
The Depositary will not be deemed to have any knowledge of any item for which it is supposed to receive notification under any Section of this Deposit Agreement unless and until it has received such notification.
Section 4.04. Notice of Dividends, Etc.; Fixing Record Date for Holders of Receipts. Whenever any cash dividend or other cash distribution shall become payable or any distribution other than cash shall be made, or if rights, preferences or privileges shall at any time be offered with respect to Stock, or whenever the Depositary shall receive notice of (i) any meeting at which holders of Stock are entitled to vote or of which holders of Stock are entitled to notice or (ii) any election on the part of the Company to redeem any shares of Stock, or whenever the Depositary and the Company shall decide it is appropriate, the Depositary shall in each such instance fix a record date (which shall be the same date as the record date fixed by the Company with respect to or otherwise in accordance with the terms of the Stock) for the determination of the holders of Receipts who shall be entitled to receive such dividend, distribution, rights, preferences or privileges or the net proceeds of the sale thereof, or to give instructions for the exercise of voting rights at any such meeting, or who shall be entitled to notice of such meeting, or whose Depositary Shares are to be redeemed or for any other appropriate reasons.
Section 4.05. Voting Rights. Upon receipt of notice of any meeting at which the holders of Stock are entitled to vote, the Depositary shall, as soon as practicable thereafter, mail to the holders of Receipts entitled thereto a notice that shall contain (i) such information as is contained in such notice of meeting and (ii) a statement that such holders may, subject to any applicable restrictions, instruct the Depositary as to the exercise of the voting rights pertaining to the amount of Stock represented by their respective Depositary Shares (including an express indication that instructions may be given to the Depositary to give a discretionary proxy to a person designated by the Company) and a brief statement as to the manner in which such instructions may be given. Upon the written request of the holders of Receipts on the relevant record date, the Depositary shall endeavor insofar as practicable to vote or cause to be voted, in accordance with the instructions set forth in such requests, the maximum number of whole shares of Stock represented by the Depositary Shares evidenced by all Receipts as to which
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any particular voting instructions are received, provided that the Depositary receives such instructions sufficiently in advance of such voting to enable it to so vote or cause such Stock to be voted. The Company hereby agrees to take all reasonable action that may be deemed necessary by the Depositary in order to enable the Depositary to vote such Stock or cause such Stock to be voted. In the absence of specific instructions from the holder of a Receipt, the Depositary will abstain from voting (but, in its discretion, not from appearing at any meeting with respect to such Stock unless directed to the contrary by the holders of all the Receipts) to the extent of the Stock represented by the Depositary Shares evidenced by such Receipt.
Section 4.06. Changes Affecting Deposited Securities and Reclassifications, Recapitalizations, Etc. Upon any change in par value or liquidation preference, split-up, combination or any other reclassification of the Stock, or upon any recapitalization, reorganization, merger, amalgamation or consolidation affecting the Company or to which it is a party, the Depositary may in its discretion with the approval of, and shall upon the instructions of, the Company, and (in either case) in such manner as the Depositary may deem equitable, (i) make such adjustments as are certified by the Company in the fraction of an interest represented by one Depositary Share in one share of Stock as may be necessary fully to reflect the effects of such change in par value or liquidation preference, split-up, combination or other reclassification of Stock, or of such recapitalization, reorganization, merger, amalgamation or consolidation and (ii) treat any securities that shall be received by the Depositary in exchange for or upon conversion of or in respect of the Stock as new deposited securities so received in exchange for or upon conversion or in respect of such Stock. In any such case the Depositary may in its discretion, with the approval of the Company, execute and deliver additional Receipts or may call for the surrender of all outstanding Receipts to be exchanged for new Receipts specifically describing such new deposited securities. Anything to the contrary herein notwithstanding, holders of Receipts shall have the right from and after the effective date of any such change in par value or liquidation preference, split-up, combination or other reclassification of the Stock or any such recapitalization, reorganization, merger, amalgamation or consolidation to surrender such Receipts to the Depositary with instructions to convert, exchange or surrender the Stock represented thereby only into or for, as the case may be, the kind and amount of shares of stock and other securities and property and cash into which the Stock represented by such Receipts might have been converted or for which such Stock might have been exchanged or surrendered immediately prior to the effective date of such transaction.
Section 4.07. [Reserved]
Section 4.08. Lists of Receipt Holders. Promptly upon request from time to time by the Company, but in no event more frequently than quarterly, the Depositary shall furnish to it a list, as of a recent date, of the names, addresses and holdings of all holders of Receipts.
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Article
5
The Depositary, the Depositary’s Agents, the Registrar and the Company
Section 5.01. Maintenance of Offices, Agencies and Transfer Books by the Depositary; Registrar. Upon execution of this Deposit Agreement, the Depositary shall maintain at the Depositary’s Office, facilities for the execution and delivery, registration and registration of transfer, surrender and exchange, split-up, combination and redemption of Receipts and deposit and withdrawal of Stock, and at the offices of the Depositary’s Agents, if any, facilities for the delivery, registration of transfer, surrender and exchange, split-up, combination and redemption of Receipts and deposit and withdrawal of Stock, all in accordance with the provisions of this Deposit Agreement.
The Depositary shall keep books at the Depositary’s Office for the registration and registration of transfer of Receipts, which books at all reasonable times shall be open for inspection by the holders of Receipts; provided that any such holder requesting to exercise such right shall certify to the Depositary that such inspection shall be for a proper purpose reasonably related to such person’s interest as an owner of Depositary Shares evidenced by the Receipts.
The Depositary may close such books, at any time or from time to time, when deemed expedient by it in connection with the performance of its duties hereunder.
The Depositary may, with the approval of the Company, appoint a Registrar for registration of the Receipts or the Depositary Shares evidenced thereby. If the Receipts or the Depositary Shares evidenced thereby or the Stock represented by such Depositary Shares shall be listed on the New York Stock Exchange, the Depositary will act as Registrar or appoint a Registrar (acceptable to the Company) for registration of such Receipts or Depositary Shares in accordance with any requirements of such Exchange. Such Registrar (which may be the Depositary if so permitted by the requirements of such Exchange) may be removed and a substitute registrar appointed by the Depositary upon the request or with the approval of the Company. If the Receipts or such Depositary Shares are listed on one or more other stock exchanges, the Depositary will, at the request of the Company, arrange such facilities for the delivery, registration, registration of transfer, surrender and exchange of such Receipts or such Depositary Shares as may be required by law or applicable stock exchange regulation.
Section 5.02. Prevention of or Delay in Performance by the Depositary or the Company. None of the Depositary, the Depositary’s Agents, the Registrar or the Company shall incur any liability to any holder of any Receipt if by reason of any provision of any present or future law, or regulation thereunder, of the United States of America or of any other governmental authority or by reason of any provision, present or future, of the Company’s Amended and Restated Certificate
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of Incorporation, as amended (including the Certificate), or of the Depositary Shares or by reason of forces beyond its control, including, without limitation, strikes, work stoppages, industrial accidents, act of war or terrorism, civil or military disturbances, nuclear or natural catastrophes, outbreaks of infectious disease or acts of God, and interruptions, loss or malfunctions of utilities or communications services, the Depositary, the Depositary’s Agents, the Registrar or the Company shall be prevented or forbidden from, delayed in, or subjected to any penalty on account of, doing or performing any act or thing which the terms of this Deposit Agreement provide shall be done or performed; nor shall the Depositary, the Depositary’s Agents, the Registrar, or the Company incur liability to any holder of a Receipt (i) by reason of any nonperformance or delay, caused as aforesaid, in the performance of any act or thing which the terms of this Deposit Agreement shall provide shall or may be done or performed, or (ii) by reason of any exercise of, or failure to exercise, any discretion provided for in this Deposit Agreement except, in the case of any such exercise or failure to exercise discretion not caused as aforesaid, if caused by the negligence or willful misconduct of the party charged with such exercise or failure to exercise.
Where, by the terms of a distribution pursuant to Sections 4.01 or 4.02 of this Deposit Agreement, or an offering or distribution pursuant to Section 4.03 of this Deposit Agreement, or for any other reason, such distribution or offering may not be made available to holders of Receipts, and it is impractical or unreasonable for the Depositary to dispose of such distribution or offering on behalf of such holders and make the net proceeds available to such holders, then the Depositary shall not make such distribution or offering, and shall allow any rights, if applicable, to lapse.
Section 5.03. Obligation of the Depositary and the Company. None of the Depositary, the Depositary’s Agents, the Registrar or the Company assumes any obligation or shall be subject to any liability under this Deposit Agreement other than to perform those duties as are specifically set forth in this Deposit Agreement without negligence or willful misconduct and no covenants or obligations shall be implied in or read into this Deposit Agreement. Notwithstanding anything in this Agreement to the contrary, neither the Depositary, nor the Depositary’s Agent nor any Registrar nor the Company shall be liable in any event for special, punitive, incidental, indirect or consequential losses or damages of any kind whatsoever (including but not limited to lost profits) irrespective of whether such entity or person has been advised of the likelihood of such loss or damage and regardless of the form of action.
None of the Depositary, the Depositary’s Agents, the Registrar or the Company shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding in respect of the Stock, the Depositary Shares or the Receipts on behalf of the Holders or any other person.
None of the Depositary, the Depositary’s Agents, the Registrar or the Company shall be liable for any action or any failure to act by it in reliance upon
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the advice of legal counsel or accountants, or information from any person presenting Stock for deposit, any holder of a Receipt or any other person believed by it to be competent to give such advice or information. The Depositary, the Depositary’s Agents, the Registrar and the Company may each rely and shall each be protected in acting upon any written notice, request, direction or other document believed by it to be genuine and to have been signed or presented by the proper party or parties.
The Depositary shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Depositary was negligent in ascertaining the pertinent facts. A “Responsible Officer” is any vice president, any assistant vice president, any assistant treasurer, any trust officer or assistant trust officer, any associate or senior associate or any other officer of the Depositary customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject and who, in each case, shall have direct responsibility for the administration of this Deposit Agreement.
The Depositary shall not be responsible for any failure to carry out any instruction to vote any of the shares of Stock or for the manner or effect of any such vote made, as long as any such action or non-action is in good faith. The Depositary undertakes to perform such duties and only such duties as are specifically set forth in this Deposit Agreement, and no implied covenants or obligations shall be read into this Deposit Agreement against the Depositary or any Registrar. The Depositary, the Depositary’s Agents and any Registrar may own and deal in any class of securities of the Company and its affiliates and in Receipts. The Depositary may also act as transfer agent or registrar of any of the securities of the Company and its affiliates.
No provision of this Deposit Agreement shall require the Depositary to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.
The Depositary shall not be obligated to segregate money held by it under this Deposit Agreement from other monies held by it, except as required by law.
In the event the Depositary believes any ambiguity or uncertainty exists hereunder or in any notice, instruction, direction, request or other communication, paper or document received by the Depositary hereunder, or in the administration of any of the provisions of this Agreement, the Depositary shall deem it necessary or desirable that a matter be proved or established prior to taking, omitting or suffering to take any action hereunder, the Depositary may, in its sole discretion
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upon written notice to the Company, refrain from taking any action and shall be fully protected and shall not be liable in any way to the Company, any holders of Receipts or any other person or entity for refraining from taking such action, unless the Depositary receives written instructions or a certificate signed by the Company which eliminates such ambiguity or uncertainty to the satisfaction of the Depositary or which proves or establishes the applicable matter to the satisfaction of the Depositary.
The Depositary undertakes not to execute and deliver any Receipt other than to evidence the Depositary Shares representing the Stock that has been delivered to and is then on deposit with the Depositary. The Depositary also undertakes not to sell (except as provided herein), pledge or lend Stock held by it as Depositary.
No disclaimer of liability by the Company under the Securities Act is intended by any provision of this Deposit Agreement.
Section 5.04. Resignation and Removal of the Depositary; Appointment of Successor Depositary. The Depositary may at any time resign as Depositary hereunder by delivering written notice of its election to do so to the Company, such resignation to take effect upon the appointment of a successor Depositary and its acceptance of such appointment as hereinafter provided.
The Depositary may at any time be removed by the Company by notice of such removal delivered to the Depositary, such removal to take effect upon the appointment of a successor Depositary hereunder and its acceptance of such appointment as hereinafter provided.
In case at any time the Depositary acting hereunder shall resign or be removed, the Company shall, within 60 days after the delivery of the notice of resignation or removal, as the case may be, appoint a successor Depositary, which shall be a bank or trust company having its principal office in the United States of America and having a combined capital and surplus of at least $50,000,000. If no successor Depositary shall have been so appointed and have accepted appointment within 60 days after delivery of such notice, the resigning or removed Depositary may petition any court of competent jurisdiction for the appointment of a successor Depositary. Every successor Depositary shall execute and deliver to its predecessor and to the Company an instrument in writing accepting its appointment hereunder, and thereupon such successor Depositary, without any further act or deed, shall become fully vested with all the rights, powers, duties and obligations of its predecessor and for all purposes shall be the Depositary under this Deposit Agreement, and such predecessor, upon payment of all sums due it and upon the written request of the Company, shall execute and deliver an instrument transferring to such successor all rights and powers of such predecessor hereunder, shall duly assign, transfer and deliver all right, title and interest in the Stock and any moneys or property held hereunder to such successor, and shall deliver to such successor a list of the holders of all outstanding Receipts
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and such records, books and other information in its possession relating thereto. Any successor Depositary shall promptly mail notice of its appointment to the holders of Receipts.
Any entity into or with which the Depositary may be merged, consolidated or converted shall be the successor of such Depositary without the execution or filing of any document or any further act, and notice thereof shall not be required hereunder. Such successor Depositary may execute the Receipts in the name of the predecessor Depositary or in the name of the successor Depositary.
Section 5.05. Corporate Reports. The Company agrees that it will transmit to the holders of Receipts, in each case at the addresses furnished to it pursuant to Section 4.08, all reports (including without limitation financial statements) required by law or by the rules of any national securities exchange upon which the Stock, the Depositary Shares or the Receipts are listed, to be furnished to the holders of Receipts. Such transmission will be at the Company’s expense. No report of that kind shall constitute a notice or constructive notice to the Depositary of any matter or information contained in or determinable from that report.
Section 5.06. Indemnification. Notwithstanding anything in Section 5.03 to the contrary, the Company shall indemnify the Depositary, any Depositary’s Agent and any Registrar (including each of their officers, directors, agents and employees) against, and hold each of them harmless from, any loss, damage, cost, penalty, liability or expense (including the reasonable costs and expenses of defending itself) which may arise out of or, in connection with acts performed, suffered or omitted to be taken in connection with this Agreement and the Receipts by the Depositary, any Registrar or any of their respective agents (including any Depositary’s Agent) and any transactions or documents contemplated hereby, except for any liability arising out of negligence, willful misconduct or bad faith on the respective parts of any such person or persons. The obligations of the Company set forth in this Section 5.06 shall survive any succession of any Depositary, Registrar or Depositary’s Agent.
Any person seeking indemnification hereunder (an “indemnified person”) shall notify the person from whom it is seeking indemnification in writing (the “indemnifying person”) of the commencement of any action or claim in respect of which indemnification may be sought promptly after such indemnified person becomes aware of such commencement (provided that the failure to make such notification shall not affect such indemnified person’s rights under this Section 5.06) and shall consult in good faith with the indemnifying person as to the conduct of the defense of such action or claim, which shall be reasonable in the circumstances. No indemnified person shall compromise or settle any such action or claim without the consent of the indemnifying person.
Section 5.07. Charges and Expenses. The Company shall pay all transfer and other taxes and governmental charges arising solely from the existence of the
19
depositary arrangements. The Company shall pay all charges of the Depositary in connection with the initial deposit of the Stock and the initial issuance of the Depositary Shares, all withdrawals of shares of the Stock by Holders of Depositary Shares and the registration of transfer of title to any Depositary Shares. All other transfer and other taxes and governmental charges shall be at the expense of holders of Depositary Shares. If, at the request of a holder of Receipts, the Depositary incurs charges or expenses for which it or the Company is not otherwise liable hereunder, such holder will be liable for such charges and expenses. All charges and expenses of the Depositary and any Depositary’s Agent hereunder and of any Registrar (including, in each case, fees and expenses of counsel) incident to the performance of their respective obligations hereunder will be paid by the Company upon consultation and agreement between the Depositary and the Company as to the amount and nature of such charges and expenses. The Depositary shall present its statement for charges and expenses to the Company once every three months or at such other intervals as the Company and the Depositary may agree.
Article
6
Amendment and Termination
Section 6.01. Amendment. The form of the Receipts and any provisions of this Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect which they may deem necessary or desirable; provided, however, that no such amendment which shall materially and adversely alter the rights of the holders of Receipts shall be effective unless such amendment shall have been approved by the holders of at least a majority of the Depositary Shares then outstanding. Notwithstanding the foregoing, in no event may any amendment impair the right of any holder of any Receipts, upon surrender of such Receipts and subject to any conditions specified in this Deposit Agreement, to receive shares of Stock and any money or other property represented thereby, except in order to comply with mandatory provisions of applicable law. Every holder of an outstanding Receipt at the time any such amendment becomes effective in accordance with its terms shall be deemed, by continuing to hold such Receipt, to consent and agree to such amendment and to be bound by the Deposit Agreement as amended thereby.
Section 6.02. Termination. This Deposit Agreement may be terminated by the Company at any time upon not less than 60 days’ prior written notice to the Depositary, in which case, upon a date that is not later than 30 days after the date of such notice, the Depositary shall deliver or make available for delivery to holders of Receipts, upon surrender of the Receipt or Receipts held by such holder, and upon payment of any applicable taxes or governmental charges, such number of whole shares of Stock represented by such Receipt or Receipts. The Depositary may likewise terminate this Deposit Agreement by mailing notice of such termination to the Company and the holders of all Receipts then outstanding if at any time 60 days shall have expired after the Depositary shall have delivered
20
to the Company a written notice of its election to resign and a successor Depositary shall not have been appointed and accepted its appointment as provided in Section 5.04. If the holder of any Receipt or Receipts shall not have surrendered such Receipt or Receipts in exchange for whole shares of Stock on or prior to the effective date of termination of this Deposit Agreement, such holder shall for all purposes, including the payment of dividends, be deemed to be a holder of the appropriate number of whole shares of Stock previously represented by such Receipt or Receipts and shall thereafter surrender to the Company such Receipt or Receipts in exchange for whole shares of Stock.
If any Receipts shall remain outstanding after the date of termination, the Depositary thereafter shall discontinue the registration of transfers of Receipts, shall suspend the distribution of dividends to the holders thereof, and shall not give any further notices or perform any further acts under this Deposit Agreement, except that the Depositary shall continue to collect dividends and other distributions pertaining to the Stock, shall sell rights as provided in this Deposit Agreement, and shall continue to deliver such Stock, together with any dividends or other distributions received with respect thereto and the net proceeds of the sale of any rights or other property, in exchange for Receipts surrendered to the Depositary (after deducting, in each case, the fee of the Depositary for the surrender of a Receipt, any expenses for the account of the holder of such Receipt in accordance with the terms and conditions of this Deposit Agreement, and any applicable taxes or governmental charges). At any time after the expiration of one year from the date of termination, the Depositary may sell such Stock then held hereunder and may thereafter hold uninvested the net proceeds of any such sale, together with any other cash then held by it hereunder, without liability for interest, for the pro rata benefit of the holders which have not theretofore surrendered their Receipts. After making such sale, the Depositary shall be discharged from all obligations under this Deposit Agreement, except to account for such net proceeds and other cash (after deducting, in each case, the fee of the Depositary for the surrender of a Receipt, any expenses for the account of the holder of such Receipt in accordance with the terms and conditions of this Deposit Agreement, and any applicable taxes or governmental charges).
This Deposit Agreement shall automatically terminate after there shall have been made a final distribution in respect of the Stock in connection with any liquidation, dissolution or winding up of the Company and such distribution shall have been distributed to the holders of Receipts pursuant to Sections 4.01 or 4.02, as applicable.
Upon the termination of this Deposit Agreement, the Company shall be discharged from all obligations under this Deposit Agreement except for its obligations to the Depositary and any Depositary’s Agent and any Registrar under Sections 5.06 and 5.07.
21
Article
7
Miscellaneous
Section 7.01. Counterparts. This Deposit Agreement may be executed in any number of counterparts, and by each of the parties hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed an original, but all such counterparts taken together shall constitute one and the same instrument. Counterparts may be delivered via facsimile, electronic mail (including .pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective as delivery of a manually executed counterpart of this Deposit Agreement. Each of the Company and the Depositary represents that it has undertaken commercially reasonable steps to verify the identity of each individual person executing any such counterparts via electronic signature on behalf of such party and has and will maintain sufficient records of the same.
Section 7.02. Exclusive Benefit of Parties. This Deposit Agreement is for the exclusive benefit of the parties hereto, and their respective successors hereunder, and shall not be deemed to give any legal or equitable right, remedy or claim to any other person whatsoever.
Section 7.03. Invalidity of Provisions. In case any one or more of the provisions contained in this Deposit Agreement or in the Receipts should be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein or therein shall in no way be affected, prejudiced or disturbed thereby.
Section 7.04. Notices. Any and all notices to be given to the Company hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail, or by telegram or facsimile transmission confirmed by letter, addressed to the Company at
1585 Broadway
New York, New York 10036
Attention: Corporate Treasury
Telephone No.: (212) 761-4000
Facsimile No.: (212) 762-0339
or at any other address of which the Company shall have notified the Depositary in writing.
Any and all notices to be given to the Depositary hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail, or by telegram or facsimile transmission confirmed by letter, addressed to the Depositary at the Depositary’s Office at
22
The Bank of New York Mellon
240 Greenwich Street, 7E
New York, New York 10286
Attention: Dealing & Trading / Candace Clarke
Telephone No.: (212) 815-5570
Facsimile No.: (732) 667-9221
or at any other address of which the Depositary shall have notified the Company in writing.
Any and all notices to be given to any holder of a Receipt hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail, or by telegram or facsimile transmission confirmed by letter, addressed to such holder at the address of such holder as it appears on the books of the Depositary, or if such holder shall have timely filed with the Depositary a written request that notices intended for such holder be mailed to some other address, at the address designated in such request.
Delivery of a notice sent by mail or by telegram or facsimile transmission shall be deemed to be effected at the time when a duly addressed letter containing the same (or a confirmation thereof in the case of a telegram or facsimile transmission) is deposited, first class postage prepaid, in a post office letter box. The Depositary or the Company may, however, without liability, act upon any telegram or facsimile transmission received by it from the other or from any holder of a Receipt, notwithstanding that such telegram or facsimile transmission shall not subsequently be confirmed by letter or as aforesaid.
Section 7.05. Depositary’s Agents. The Depositary may perform any of its duties hereunder either directly or by or through (i) registrars or transfer agents appointed by the Depositary with the approval of the Company, pursuant to this Deposit Agreement, or other similar agents appointed by the Depositary (collectively, the “Depositary’s Agents”), and the Depositary shall not be responsible for any misconduct or negligence on the part of the Depositary’s Agents except to the extent that the Depositary would be responsible under this Deposit Agreement if the Depositary had performed its duties directly, or (ii) attorneys, nominees, correspondents, designees, custodians, subcustodians or other incidental service providers (including, without limitation, postal, courier or printing services), and the Depositary shall not be responsible for any misconduct or negligence on the part of any attorney, nominee, correspondent, designee, custodian, subcustodian or other incidental service provider selected with reasonable care hereunder.
Section 7.06. Appointment of Registrar and Transfer Agent in respect of the Depositary Shares and Receipts. The Company hereby appoints the Depositary as Registrar, transfer agent, dividend disbursing agent and redemption agent in respect of the Depositary Shares and the related Receipts and the Depositary hereby accepts such appointments.
23
Section 7.07. Appointment of Registrar and Transfer Agent in respect of the Stock. The Company hereby appoints The Bank of New York Mellon as transfer agent, registrar, dividend disbursing agent and redemption agent in respect of the Stock, and The Bank of New York Mellon hereby accepts such appointments. With respect to the appointments of The Bank of New York Mellon as transfer agent, registrar, dividend disbursing agent and redemption agent in respect of the Stock, The Bank of New York Mellon shall be entitled to the same rights, indemnities, immunities and benefits as Depositary hereunder as if explicitly named in each such provision, it being understood that the Stock is not and the Company does not expect to make the Stock eligible for settlement through DTC.
Section 7.08. Appointment of Calculation Agent. The Company hereby appoints The Bank of New York Mellon as calculation agent solely with respect to calculating the amount of dividends to be paid with respect to the Stock, including determining the LIBOR rate during the floating rate period, as defined in Exhibit B annexed hereto, if applicable, in the manner and at the times provided in Exhibit B annexed hereto, and The Bank of New York Mellon hereby accepts such appointment. The Bank of New York Mellon, in such capacity, shall communicate in writing such determination and its calculation of the amount of such dividends on the dividend determination date during the floating rate period, as described in Exhibit B annexed hereto, to the Company in the manner set forth in Section 7.04 hereof or, alternately, to the Company via electronic mail (at an electronic mail address provided to the Depositary by the Company), followed by a telephonic confirmation. With respect to the appointment of The Bank of New York Mellon, as calculation agent, The Bank of New York Mellon, in its capacity under such appointment, shall be entitled to the same rights, indemnities and benefits as the Depositary hereunder, as if explicitly named in each such provision.
Section 7.09. Waiver of Jury Trial. EACH OF THE COMPANY, THE HOLDERS AND THE DEPOSITARY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS DEPOSIT AGREEMENT, THE DEPOSITARY SHARES OR THE TRANSACTION CONTEMPLATED HEREBY.
Section 7.10. Holders of Receipts Are Parties. The holders of Receipts from time to time shall be parties to this Deposit Agreement and shall be bound by all of the terms and conditions hereof and of the Receipts by acceptance of delivery thereof.
Section 7.11. Governing Law and Submission to Jurisdiction. This Deposit Agreement and the Receipts and all rights hereunder and thereunder and provisions hereof and thereof shall be governed by, and construed in accordance with, the laws of the State of New York. Any suit, action or proceeding brought by one party hereto against another party hereto in connection with or arising
24
under this Deposit Agreement shall be brought solely in the state or federal court or appropriate jurisdiction located in the Borough of Manhattan, The City of New York and each party hereto irrevocably waives, to the fullest extent permitted by law, (i) any objection that such courts are an inconvenient forum and (ii) any claim of immunity, sovereign or otherwise.
Section 7.12. Inspection of Deposit Agreement. Copies of this Deposit Agreement shall be filed with the Depositary and the Depositary’s Agents and shall be open to inspection during business hours at the Depositary’s Office and the respective offices of the Depositary’s Agents, if any, by any holder of a Receipt.
Section 7.13. Headings. The headings of articles and sections in this Deposit Agreement and in the form of the Receipt set forth in Exhibit A hereto have been inserted for convenience only and are not to be regarded as a part of this Deposit Agreement or the Receipts or to have any bearing upon the meaning or interpretation of any provision contained herein or in the Receipts.
IN WITNESS WHEREOF, the Company and the Depositary have duly executed this Deposit Agreement as of the day and year first above set forth, and all holders of Receipts shall become parties hereto by and upon acceptance by them of delivery of Receipts issued in accordance with the terms hereof.
25
| MORGAN STANLEY | ||
| By: | ||
| Name: | ||
| Title: | ||
| THE BANK OF NEW YORK MELLON, as Depositary | ||
| By: | ||
| Name: | ||
| Title: | ||
26
EXHIBIT A
[FORM OF FACE OF RECEIPT]
NUMBER DEPOSITARY SHARES
DEPOSITARY RECEIPT FOR DEPOSITARY SHARES,
REPRESENTING FIXED-TO-FLOATING RATE NON-CUMULATIVE
PREFERRED STOCK, SERIES N, OF MORGAN STANLEY.
CUSIP: ___________________
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE. SEE REVERSE FOR CERTAIN DEFINITIONS
THE BANK OF NEW YORK MELLON, as Depositary (the “Depositary”), hereby certifies that is the registered owner of DEPOSITARY SHARES (“Depositary Shares”), each Depositary Share representing 1/100th of a share of Fixed-to-Floating Rate Non-Cumulative Preferred Stock, Series N, par value $0.01, liquidation preference $100,000 per share (the “Stock”), of Morgan Stanley, a Delaware corporation (the “Corporation”), on deposit with the Depositary, subject to the terms and entitled to the benefits of the Deposit Agreement dated as of _____, 20__ (the “Deposit Agreement”), among the Corporation, the Depositary and the holders from time to time of the Depositary Receipts issued thereunder. By accepting this Depositary Receipt, the holder hereof becomes a party to and agrees to be bound by all the terms and conditions of the Deposit Agreement. This Depositary Receipt shall not be valid or obligatory for any purpose or entitled to any benefits under the Deposit Agreement unless it shall have been executed by the Depositary by the manual signature of a duly authorized officer or, if executed in facsimile by the Depositary, countersigned by a Registrar in respect of the Depositary Receipts by the manual signature of a duly authorized signatory thereof.
Countersigned and Registered:
| THE BANK OF NEW YORK MELLON Registrar |
THE BANK OF NEW YORK MELLON Depositary | |||
| By: | By: | |||
| Name: | Name: | |||
| Title: | Title: | |||
A-1
[FORM OF REVERSE OF RECEIPT]
MORGAN STANLEY
THE CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH RECEIPTHOLDER WHO SO REQUESTS A COPY OF THE DEPOSIT AGREEMENT AND A COPY OR SUMMARY OF THE CERTIFICATE OF THE DESIGNATIONS, POWERS, PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER RIGHTS, AND OF THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS THEREOF, OF THE STOCK OF THE CORPORATION. ANY SUCH REQUEST IS TO BE ADDRESSED TO THE DEPOSITARY NAMED ON THE FACE OF THIS RECEIPT.
___________________
The following abbreviations, when used in the instructions on the face of this receipt, shall be construed as though they were written out in full according to applicable laws or regulations.
| TEN COM - as tenants in common | UNIF GIFT MIN ACT - _____ Custodian ___________ (minor) (Cust) | ||
| TEN ENT - as tenants by the entireties |
Under Uniform Gifts to Minors Act | ||
|
(State)
|
|||
| JT TEN - as joint tenants with right of survivorship and not as tenants in common |
|||
| Additional abbreviations may also be used though not in the above list. | |||
A-2
For value received, _______________ hereby sell(s), assign(s) and transfer(s) unto
| PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE |
|
| PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE |
| ________________________________________ Depositary Shares represented by the within Receipt, and do(es) hereby irrevocably constitute and appoint ____________________ Attorney to transfer the said Depositary Shares on the books of the within named Depositary with full power of substitution in the premises. |
Dated___________________________
|
Signature
NOTICE: The signature to the assignment must correspond with the name as written upon the face of this Receipt in every particular, without alteration or enlargement or any change whatsoever
|
| SIGNATURE GUARANTEED | |
NOTICE: The signature(s) should be
guaranteed by an eligible guarantor
institution (banks, stockbrokers, savings
and loan associations, and credit unions
with membership in an approved signature
guarantee medallion program), pursuant to
Rule 17Ad-15 under the Securities
Exchange Act of 1934.
A-3
EXHIBIT B
Holders of Stock will be entitled to receive, only when, as and if declared by the Company’s Board of Directors or a duly authorized committee of the Board of Directors, out of funds legally available for the payment of dividends under Delaware law, non-cumulative cash dividends from September 15, 2020 (in the case of the initial dividend period only, as described below) or the immediately preceding dividend payment date, semi-annually in arrears on the 15th day of March and September of each year, commencing on March 15, 2021 and ending on March 15, 2023 and thereafter quarterly in arrears on the 15th day of March, June, September and December of each year (each such date, a “dividend payment date”). These dividends will accrue on the liquidation preference amount of $100,000 per share (equivalent to $1,000 per Depositary Share) at a rate per annum equal to 5.30% with respect to each dividend period from and including September 15, 2020 to, but excluding, March 15, 2023 (the “fixed rate period”) and at a rate per annum equal to the three-month U.S. dollar LIBOR (as described below) on the related dividend determination date plus 3.16% with respect to each dividend period from and including March 15, 2023 (the “floating rate period”). In the event that the Company issues additional shares of Stock after the original issue date, dividends on such shares may accrue from the original issue date or any other date specified by the Company’s Board of Directors or an authorized committee thereof at the time such additional shares are issued.
Dividends that are payable on Stock on any dividend payment date will be payable to holders of record of Stock as they appear on the stock register of the Company on the applicable record date, which shall be the 15th calendar day before such dividend payment date or such other record date fixed by the Company’s Board of Directors or a duly authorized committee of the Board of Directors that is not more than 60 nor less than 10 days prior to such dividend payment date (each, a “dividend record date”). The corresponding record dates for the Depositary Shares will be the same as the record dates for the Stock.
A “dividend period” is the period from and including a dividend payment date to but excluding the next dividend payment date or any earlier redemption date, except that (i) the initial dividend period for any share of Stock issued on the original issue date will commence on and include September 15, 2020 and will end on and exclude the March 15, 2021 dividend payment date, and (ii) for any share of Stock issued after the original issue date, the initial dividend period for such shares may commence on and include the original issue date or such other date as the Company’s Board of Directors or a duly authorized committee of the Board of Directors shall determine and publicly disclose and shall end on and exclude the next dividend payment date. Dividends payable on the Stock for any dividend period during the fixed rate period will be computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends payable on the Stock for any dividend period during the floating rate period will be computed on the basis of a 360-day year and the actual number of days elapsed in the dividend period. Dividends for the initial dividend period for shares of Stock issued on the original issue date will be calculated from September 15, 2020. If any scheduled dividend payment date up to and including the March 15, 2023 scheduled dividend payment date is not a business day, then the payment will be made on the next succeeding business day and no additional dividends will
B-1
accrue as a result of that postponement. If any scheduled dividend payment date thereafter is not a business day, then the dividend payment date will be postponed to the next succeeding business day unless such day falls in the next calendar month, in which case the dividend payment date will be brought forward to the immediately preceding day that is a business day, and, in either case, dividends, if so declared, will accrue to, but excluding, the date dividends are paid.
For any dividend period during the floating rate period, LIBOR (the London interbank offered rate) shall be determined by the calculation agent on the second London business day immediately preceding the first day of such dividend period (each, a “dividend determination date”), in the following manner:
(i) LIBOR will be the rate for deposits in U.S. dollars for a period of three months, commencing on the first day of such dividend period, that appears on Reuters screen page “LIBOR01”, or any successor page, at approximately 11:00 a.m., London time, on that dividend determination date.
(ii) If no such rate appears, then the calculation agent will request the principal London offices of each of four major reference banks in the London interbank market, selected by the calculation agent as directed by the Company, to provide the calculation agent with its offered quotation for deposits in U.S. dollars for a period of three months, commencing on the first day of such dividend period, to prime banks in the London interbank market at approximately 11:00 a.m., London time, on that dividend determination date and in a principal amount that is representative of a single transaction in U.S. dollars in that market at that time. If at least two quotations are provided, LIBOR determined on that dividend determination date will be the arithmetic mean of those quotations. If fewer than two quotations are provided, LIBOR will be determined for the first day of such dividend period as the arithmetic mean of the rates quoted at approximately 11:00 a.m., New York time, on that dividend determination date, by three major banks in New York City, selected by the calculation agent as directed by the Company, for loans in U.S. dollars to leading European banks, for a period of three months, commencing on the first day of such dividend period, and in a principal amount that is representative of a single transaction in U.S. dollars in that market at that time.
(iii) Otherwise, the Company’s designee, after consulting such sources as it deems comparable to any of the foregoing quotations or display page, or any such source as it deems reasonable from which to estimate LIBOR or any of the foregoing lending rates, shall determine three-month LIBOR for the applicable dividend period in its sole discretion.
Notwithstanding the foregoing clauses (ii) and (iii):
· If the Company’s designee determines on the relevant dividend determination date that the LIBOR base rate has been discontinued, then the Company’s designee will designate a substitute or successor base rate that it has determined in its sole discretion is most comparable to the LIBOR base rate, and the calculation agent will use the rate so specified, provided that if the Company’s designee determines there is an industry-accepted substitute or successor base rate, then the Company’s designee shall designate such substitute or successor base rate; and
B-2
· If the Company’s designee has designated a substitute or successor base rate in accordance with the foregoing, the Company’s designee in its sole discretion may determine what business day convention to use, the definition of business day, the dividend determination date to be used and any other relevant methodology for calculating such substitute or successor base rate, including any adjustment factor needed to make such substitute or successor base rate comparable to the LIBOR base rate, in a manner that is consistent with industry-accepted practices for such substitute or successor base rate, and the calculation agent will use the methodology so specified.
The calculation agent’s determination of any dividend rate, and its calculation of the amount of dividends for any dividend period, will be on file at the Company’s principal offices, will be made available to any stockholder upon request and will be final and binding in the absence of manifest error. The calculation agent shall have no liability for any determination made by or on behalf of the Company or its designee in connection with the discontinuation of the LIBOR base rate, the designation of a substitute or successor base rate or any adjustments or conforming changes thereto.
For the purposes of this Exhibit B:
· The term “business day” means any day, other than a Saturday or 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.
· The term “London business day” means a day that is a Monday, Tuesday, Wednesday, Thursday or Friday and is a day on which dealings in U.S. dollars are transacted in the London interbank market.
· The term “Reuters” means Reuters 3000 Xtra Service or any successor service.
B-3
Exhibit 99.1
 |
 |
October 2, 2020 – FOR IMMEDIATE RELEASE
Morgan Stanley Closes Acquisition of E*TRADE
NEW YORK & ARLINGTON - Morgan Stanley (NYSE: MS) announced today that it has completed the acquisition of E*TRADE Financial Corporation (E*TRADE) in an all-stock transaction. E*TRADE common stockholders are entitled to receive 1.0432 Morgan Stanley common shares for each E*TRADE common share.
"The addition of E*TRADE positions us as an industry leader in Wealth Management across all channels and segments, and significantly increases the scale and breadth of our Wealth Management franchise, which now oversees $3.3 trillion in assets," said James P. Gorman, Chairman and Chief Executive Officer of Morgan Stanley. "E*TRADE has built a best-in-class, direct-to-consumer digital channel and a strong brand over the past 38 years. The addition of their premier offering will provide enhanced capabilities to all our clients and Financial Advisors.”
Michael Pizzi, CEO of E*TRADE, joins Morgan Stanley and will lead E*TRADE’s direct-to-consumer, digital self-directed business that will operate under the E*TRADE brand, and will co-lead the equity administration business. He also joins the Morgan Stanley Operating and Management Committees.
In addition, today Shelley Leibowitz, one of E*TRADE’s independent directors, has joined the Morgan Stanley Board of Directors. “Ms. Leibowitz brings a wealth of financial technology and management expertise. We welcome her to the Board and look forward to working with her,” said Ray Wilkins, Chair of the Board’s Nominating and Governance Committee.
Morgan Stanley is a leading global financial services firm providing investment banking, securities, wealth management and investment management services. With offices in more than 41 countries, the Firm's employees serve clients worldwide including corporations, governments, institutions and individuals. For further information about Morgan Stanley, please visit www.morganstanley.com.
This press release may contain forward-looking statements, including the attainment of certain financial and other targets, objectives and goals. Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date on which
they are made, which reflect management’s current estimates, projections, expectations, assumptions, interpretations or beliefs and which are subject to risks and uncertainties that may cause actual results to differ materially. Morgan Stanley does not undertake any obligation to update any forward-looking statements. For a discussion of risks and uncertainties that may affect the future results of the Firm, please see “Forward-Looking Statements” immediately preceding Part I, Item 1, “Competition” and “Supervision and Regulation” in Part I, Item 1, “Risk Factors” in Part I, Item 1A, “Legal Proceedings” in Part I, Item 3, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 and “Quantitative and Qualitative Disclosures about Market Risk” in Part II, Item 7A in the Firm’s Annual Report on Form 10-K for the year ended December 31, 2019 and other items throughout the Form 10-K, the Firm’s Quarterly Reports on Form 10-Q and the Firm’s Current Reports on Form 8-K, including the Current Report filed with the SEC on April 16, 2020 and the additional risk factors under “Risk Factors” in the Registration Statement on Form S-4 filed with the SEC on April 17, 2020, as amended.
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Note to Editors:
Shelley B. Leibowitz
Shelley B. Leibowitz was on the Board of Directors at E*TRADE from December 2014 to September 2020.
Ms. Leibowitz is President of SL Advisory, a firm she founded in 2016 that focuses on technology strategy, digital transformation, IT portfolio and risk management, information security, performance metrics, and governance. From 2009 through 2012, Ms. Leibowitz served as Group Chief Information Officer for the World Bank, where she was responsible for the technology services and capabilities that underlie the work of delivering quality knowledge and financing products to the Bank Group’s clients across the globe. Ms. Leibowitz managed the Bank Group’s cybersecurity program and served as a member of the Bank Group’s Pension Investment Committee. Previously, Ms. Leibowitz held Chief Information Officer positions at Morgan Stanley, Greenwich Capital Markets and Barclays Capital.
In prior years, Ms. Leibowitz served on the board of Endgame, foremost provider of cybersecurity capabilities to the U.S. intelligence and defense communities, acquired by Elastic NV in 2019, and on the board of Alliance Bernstein Holding LP, where she served on the Audit and Risk Committee. Ms. Leibowitz is currently on the board of directors of Massachusetts Mutual Life Insurance Company, where she serves on the Investment Committee and the Technology & Governance Committee. She is also a member of the Council on Foreign Relations and on the Visiting Committee of the Center for Development Economics at Williams College. Ms. Leibowitz is a Board Leadership Fellow at the National Association of Corporate Directors, where she is a frequent speaker and has achieved Directorship Certification and the CERT Certificate in Cybersecurity Oversight.
Ms. Leibowitz graduated Phi Beta Kappa from Williams College with a BA in Mathematics.
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