8-KShareholder MattersCorporate ChangesOther Events+1

JPMORGAN CHASE & CO 8-K Report, Rights Modification (Jun 23, 2014)

Filed June 23, 2014For Securities:JPMJPM-PCJPM-PDJPM-PKJPM-PLJPM-PMJPM-PJAMJBVYLD

Summary

JPMorgan Chase & Co. (JPM) filed an 8-K on June 23, 2014, to report on the issuance of its 6.30% Non-Cumulative Preferred Stock, Series W. A total of 85,000 shares of Series W Preferred Stock were issued, represented by 34,000,000 depositary shares. Each depositary share represents 1/400th of a share of Series W Preferred Stock. This issuance establishes a new class of preferred stock with specific dividend and liquidation rights. Importantly, the terms of this Series W Preferred Stock include restrictions on the company's ability to pay dividends or make distributions on its common stock or junior preferred stock if dividends on the Series W Preferred Stock are not declared or paid. Investors in this preferred stock are being offered a fixed 6.30% non-cumulative dividend, with a liquidation preference of $10,000 per share. This filing details the formal establishment of these rights and the completion of the stock offering.

Key Highlights

  • 1JPMorgan Chase & Co. issued 85,000 shares of 6.30% Non-Cumulative Preferred Stock, Series W.
  • 2The preferred stock is represented by 34,000,000 depositary shares, with each depositary share representing 1/400th of a share of Series W Preferred Stock.
  • 3The Series W Preferred Stock has a liquidation preference of $10,000 per share.
  • 4Dividends on the Series W Preferred Stock are non-cumulative, meaning missed dividends are not made up later.
  • 5The issuance of Series W Preferred Stock introduces restrictions on JPM's ability to pay dividends or make distributions on its common stock or junior preferred stock if Series W dividends are not paid.
  • 6The Certificate of Designations for the Series W Preferred Stock was filed with the Secretary of State of Delaware on June 20, 2014.
  • 7The offering was made under a Registration Statement on Form S-3 and was completed pursuant to an Underwriting Agreement dated June 16, 2014.

Frequently Asked Questions

This 8-K filing announces the establishment and issuance of a new class of preferred stock, the 6.30% Non-Cumulative Preferred Stock, Series W, by JPMorgan Chase & Co.

The Series W Preferred Stock carries a 6.30% non-cumulative dividend and has a liquidation preference of $10,000 per share. It was issued as depositary shares, with each representing a fraction of a full share.

Non-cumulative means that if JPM does not declare and pay a dividend for a specific dividend period, that dividend is forfeited and will not be paid at a later date. This contrasts with cumulative preferred stock, where missed dividends accrue and must be paid before common stock dividends can be issued.

The terms of the Series W Preferred Stock include provisions that restrict JPM's ability to pay dividends or make distributions on its common stock or any preferred stock ranking junior to or on parity with the Series W Preferred Stock, if JPM fails to declare or pay the dividends on the Series W Preferred Stock.