1
Exhibit 5.02
March 21, 2001
Citigroup Inc.
399 Park Avenue
New York, NY 10043
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
c/o Citigroup Inc.
399 Park Avenue
New York, NY 10043
Re: Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
Registration Statement on Form S-3
Ladies and Gentlemen:
We have acted as special counsel to (1) Citigroup Capital VII (formerly
Travelers Capital VII), Citigroup Capital VIII (formerly Travelers Capital
VIII), Citigroup Capital IX, Citigroup Capital X, Citigroup Capital XI,
Citigroup Capital XII and Citigroup Capital XIII (each, a "Citigroup Trust" and,
together, the "Citigroup Trusts"), each a statutory business trust created under
the laws of the State of Delaware, and (2) Citigroup Inc. (formerly Travelers
Group Inc.)(the "Company"),
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 2
a corporation organized under the laws of the State of Delaware, in connection
with the preparation of a Registration Statement on Form S-3 (the "Registration
Statement"), to be filed by the Company and the Citigroup Trusts with the
Securities and Exchange Commission (the "Commission") on March 21, 2001 under
the Securities Act of 1933, as amended (the "Act"). The Registration Statement
relates to, among other things, the issuance and sale from time to time pursuant
to Rule 415 of the General Rules and Regulations promulgated under the Act, of
the following securities with an aggregate public offering price of up to
$17,750,000,000: (i) capital securities (the "Capital Securities") of each of
the Citigroup Trusts, (ii) unsecured junior subordinated debt securities (the
"Junior Subordinated Debt Securities") of the Company which are to be issued
pursuant to an Indenture, dated as of October 7, 1996, as supplemented by the
First Supplemental Indenture thereto dated as of December 15, 1998 (as so
supplemented, the "Indenture"), between the Company and The Chase Manhattan
Bank, as debt trustee (the "Debt Trustee"), (iii) shares of preferred stock, par
value $1.00 per share (the "Preferred Stock") of the Company to be issued in one
or more series, which may also be issued in the form of depositary shares (the
"Depositary Shares") evidenced by depositary receipts (the "Receipts") pursuant
to one or more deposit agreements (each, a "Deposit Agreement") to be entered
into between the Company and a depositary to be named (the "Depositary") and
(iv) shares of common stock, par value $.01 per share (the "Common Stock"), of
the Company as may be issuable upon conversion of some or all of the Preferred
Stock (the "Offered Common Stock"). The Capital Securities of each Citigroup
Trust are to be issued pursuant to the Amended and Restated Declaration of Trust
of such Citigroup Trust (each, a "Declaration" and, collectively, the
"Declarations"), each such Declaration being among the Company, as sponsor and
as the issuer of the Junior Subordinated Debentures (as defined therein) to be
held by the Property Trustee (as defined below) of such Citigroup Trust, Chase
Manhattan Bank Delaware, as Delaware trustee (the "Delaware Trustee"), The Chase
Manhattan Bank, as
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 3
property trustee (the "Property Trustee"), and Todd Thomson, Irwin Ettinger and
Stephanie B. Mudick, as regular trustees (together, the "Regular Trustees").
This opinion is being delivered in accordance with the requirements of
Item 601(b)(5) of Regulation S-K under the Act. Capitalized terms used but not
otherwise defined herein have the meanings ascribed to them in the Registration
Statement.
In connection with this opinion, we have examined originals or copies,
certified or otherwise identified to our satisfaction, of (i) the Registration
Statement, (ii) the certificates of trust of each of (A) Citigroup Capital VII,
as filed with the Secretary of State of the State of Delaware on May 14, 1997
and the amendment thereto as filed with the Secretary of State of the State of
Delaware on October 8, 1998, (B) Citigroup Capital VIII, as filed with the
Secretary of State of the State of Delaware on May 16, 1997 and the amendment
thereto as filed with the Secretary of State of the State of Delaware on
December 7, 1998, (C) Citigroup Capital IX, as filed with the Secretary of State
of the State of Delaware on December 7, 1998, (D) Citigroup Capital X, as filed
with the Secretary of State of the State of Delaware on December 7, 1998, (E)
Citigroup Capital XI, as filed with the Secretary of State of the State of
Delaware on December 7, 1998, (F) Citigroup Capital XII, as filed with the
Secretary of State of the State of Delaware on December 7, 1998 and (G)
Citigroup Capital XIII, as filed with the Secretary of State of the State of
Delaware on December 7, 1998 (collectively, the "Certificates of Trust"); (iii)
the Form of the Declaration of each of the Citigroup Trusts (including the form
of the designations of the terms of the Capital Securities of such Citigroup
Trust annexed thereto) (collectively, the "Declarations"); (iv) the form of the
Capital Securities of each of the Citigroup Trusts; (v) the form of the capital
securities guarantee agreement (the "Capital Securities Guarantee"), to be
entered into by the Company and The Chase Manhattan Bank, as guarantee trustee
(the "Capital Securities Guarantee Trustee"); (vi) the form of the Junior
Subordinated Debt Securities; (vii) the form of the Deposit
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 4
Agreement; (viii) an executed copy of the Indenture; (ix) the Restated
Certificate of Incorporation of the Company, as amended to date (the
"Certificate of Incorporation"); (x) the By-Laws of the Company, as currently in
effect (the "By-Laws"); (xi) drafts of certain resolutions of the Board of
Directors of the Company (the "Draft Resolutions") relating to the
issuance and sale of the Offered Debt Securities (as defined below), the Capital
Securities Guarantee, the Preferred Stock, the Depositary Shares and the Offered
Common Stock and related matters and (xii) a specimen certificate evidencing the
Common Stock. We have also examined originals or copies, certified or otherwise
identified to our satisfaction, of such other documents, certificates and
records as we have deemed necessary or appropriate as a basis for the opinions
set forth herein.
In our examination, we have assumed the legal capacity of all natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to us as originals, the conformity to original documents of all
documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such copies. In making our examination of
executed documents or documents to be executed, we have assumed that the parties
thereto, other than the Company and the Citigroup Trusts, had or will have the
power, corporate, trust or other, to enter into and perform all obligations
thereunder and have also assumed the due authorization by all requisite
action, corporate or other, and execution and delivery by such parties of such
documents and that such documents constitute valid and binding obligations of
such parties. In addition, we have assumed that the Declaration of each
Citigroup Trust, the Capital Securities of each Citigroup Trust, the Capital
Securities Guarantee and the Junior Subordinated Debt Securities will be
executed in substantially the form reviewed by us and that the terms of the
Offered Capital Securities (defined below), the Offered Debt Securities (defined
below), the Offered Preferred Stock (defined below) and the Depositary Shares
will have been established so as not to violate, conflict with or constitute a
default under (i) any agreement or instrument to
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 5
which the Company or any of the Citigroup Trusts or their respective property is
subject, (ii) any law, rule, or regulation to which the Company or any of the
Citigroup Trusts is subject, (iii) any judicial or administrative order or
decree of any governmental authority or (iv) any consent, approval, license,
authorization or validation of, or filing, recording or registration with any
governmental authority. We have also assumed that (i) the stock
certificates evidencing the Preferred Stock to be issued will be in a form that
complies with, and the terms of such Preferred Stock will be duly established in
accordance with, the Delaware General Corporation Law (the "DGCL"), and (ii) the
stock certificate evidencing any Offered Common Stock issued will conform to the
specimen certificate examined by us and will be duly executed and delivered. As
to any facts material to the opinions expressed herein which were not
independently established or verified, we have relied upon oral or written
statements and representations of officers, trustees and other representatives
of the Company, the Citigroup Trusts and others.
Members of our firm are admitted to the bar in the States of Delaware
and New York, and we do not express any opinion as to the laws of any other
jurisdiction other than the laws of the United States of America to the extent
specifically referred to herein.
Based on and subject to the foregoing and to the other qualifications
and limitations set forth herein, we are of the opinion that:
1. With respect to the Capital Securities of each Citigroup Trust to be
offered pursuant to the Registration Statement (the "Offered Capital
Securities"), when (i) the Registration Statement, as finally amended
(including all necessary post-effective amendments), has become
effective under the Act; (ii) an appropriate prospectus with respect to
the Offered Capital Securities has been prepared, delivered and filed
in compliance with the Act and the
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 6
applicable rules and regulations thereunder; (iii) the Declaration of
such Citigroup Trust has been duly executed and delivered by the
parties thereto; (iv) the terms of the Offered Capital Securities have
been established in accordance with the Declaration; (v) the Offered
Capital Securities have been issued, executed and authenticated in
accordance with the Declaration and delivered and paid for in the
manner contemplated in the Registration Statement or any prospectus
relating thereto; and (vi) if the Offered Capital Securities are to be
sold pursuant to a firm commitment underwritten offering, the
underwriting agreement with respect to the Offered Capital Securities
has been duly authorized, executed and delivered by the applicable
Citigroup Trust and the other parties thereto, (1) the Offered Capital
Securities will be duly authorized for issuance and will be validly
issued, fully paid and nonassessable, representing undivided beneficial
interests in the assets of such Citigroup Trust and (2) the holders of
the Offered Capital Securities will be entitled to the same limitation
of personal liability extended to stockholders of private corporations
for profit organized under the DGCL. We bring to your attention,
however, that the holders of the Offered Capital Securities may be
obligated, pursuant to the Declaration of such Citigroup Trust, to (i)
provide indemnity and/or security in connection with, and pay taxes or
governmental charges arising from, transfers of Offered Capital
Securities and (ii) provide security and indemnity in connection with
the requests of or directions to the Property Trustee of such Citigroup
Trust to exercise its rights and powers under the Declaration of such
Citigroup Trust.
2. With respect to the Capital Securities Guarantee, when (i) the
Registration Statement, as finally amended (including all necessary
post-effective amendments), has become effective under the Act; (ii)
the Draft Resolutions have been adopted by the Board of Directors of
the Company; (iii) an appropriate prospectus with respect to the
Capital Securities Guarantee has been
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 7
prepared, delivered and filed in compliance with the Act and the
applicable rules and regulations thereunder; (iv) the Declaration of
such Citigroup Trust is duly executed and delivered by the parties
thereto; (v) the terms of the Offered Capital Securities have been
established in accordance with the Declaration; (vi) the Offered
Capital Securities have been issued and executed in accordance with the
Declaration and paid for in the manner contemplated in the Registration
Statement or any prospectus relating thereto; and (vii) if the Offered
Capital Securities are to be sold pursuant to a firm commitment
underwritten offering, the underwriting agreement with respect to the
Capital Securities Guarantee has been duly authorized, executed and
delivered by the applicable Citigroup Trust and the other parties
thereto, the Capital Securities Guarantee, when duly executed and
delivered by the parties thereto, will be a valid and binding agreement
of the Company, enforceable against the Company in accordance with its
terms, except to the extent that (a) enforcement thereof may be limited
by (i) bankruptcy, insolvency, reorganization, moratorium, or other
similar laws now or hereafter in effect relating to creditors' rights
generally and (ii) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity) and
(b) rights to indemnity and contribution thereunder may be limited by
applicable law or the public policy underlying such law.
3. With respect to any series of Junior Subordinated Debt Securities
(the "Offered Debt Securities"), when (i) the Registration Statement,
as finally amended (including all necessary post-effective amendments),
has become effective under the Act; (ii) the Draft Resolutions have
been adopted by the Board of Directors of the Company; (iii) an
appropriate prospectus with respect to the Offered Debt Securities has
been prepared, delivered and filed in compliance with the Act and the
applicable rules and regulations thereunder; (iv) the Board of
Directors, including any appropriate committee
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 8
appointed thereby, and appropriate officers of the Company have taken
all necessary corporate action to approve the issuance and terms of the
Offered Debt Securities and related matters; (v) the terms of the
Offered Debt Securities have been established in conformity with the
Indenture; (vi) the Offered Debt Securities are duly executed,
delivered, authenticated and issued in accordance with the Indenture
and delivered and paid for in the manner contemplated in the
Registration Statement or any prospectus relating thereto; and (vii) if
the Offered Debt Securities are to be sold pursuant to a firm
commitment underwritten offering, the underwriting agreement with
respect to the Offered Debt Securities has been duly authorized,
executed and delivered by the parties thereto, the Offered Debt
Securities will be valid and binding obligations of the Company,
entitled to the benefits of the Indenture and enforceable against the
Company in accordance with their terms, except to the extent that
enforcement thereof may be limited by (i) bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium, or other similar
laws now or hereafter in effect relating to creditors' rights generally
and (ii) general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity).
4. With respect to the shares of any series of Preferred Stock (the
"Offered Preferred Stock"), when (i) the Registration Statement, as
finally amended (including all necessary post-effective amendments),
has become effective under the Act; (ii) the Draft Resolutions have
been adopted by the Board of Directors of the Company; (iii) an
appropriate prospectus supplement with respect to the shares of the
Offered Preferred Stock has been prepared, delivered and filed in
compliance with the Act and the applicable rules and regulations
thereunder; (iv) the terms of the Offered Preferred Stock and of their
issuance and sale have been duly established by all necessary corporate
action in conformity with the Company's Certificate of Incorporation,
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 9
including the Certificate of Designation relating to the Offered
Preferred Stock, and the By-Laws of the Company; (v) the filing of the
Certificate of Designation with the Secretary of State of the State of
Delaware has duly occurred; (vi) if the Offered Preferred Stock is to
be sold pursuant to a firm commitment underwritten offering, the
underwriting agreement with respect to the shares of the Offered
Preferred Stock has been duly authorized, executed and delivered by the
Company and the other parties thereto; and (vii) certificates
representing the shares of the Offered Preferred Stock have been duly
executed and delivered by the proper officers of the Company to the
purchasers thereof against payment of the agreed-upon consideration
therefor in the manner contemplated in the Registration Statement or
any prospectus supplement or term sheet relating thereto, (1) the
shares of the Offered Preferred Stock, when issued and sold in
accordance with the applicable underwriting agreement or any other duly
authorized, executed and delivered applicable purchase agreement, will
be duly authorized, validly issued, fully paid and nonassessable,
provided that the consideration therefor is not less than the par value
thereof; and (2) if the Offered Preferred Stock is convertible into
Offered Common Stock, the Offered Common Stock issuable upon conversion
of the Offered Preferred Stock will be duly authorized, validly issued,
fully paid and nonassessable, assuming the issuance of the Offered
Common Stock upon conversion of the Offered Preferred Stock has been
authorized by all necessary corporate action, that the Offered
Preferred Stock has been converted in accordance with the terms of the
Certificate of Designation and that the certificates evidencing such
shares of Offered Common Stock are duly executed and delivered. In
rendering the opinion set forth in clause (2) of this paragraph 4, we
have assumed that, at the time of issuance of any Offered Common Stock
upon conversion of the Offered Preferred Stock, the Certificate of
Incorporation, the By-Laws and the DGCL shall not have been amended so
as to affect the validity of such issuance.
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 10
5. With respect to any Depositary Shares representing fractional
interests in any Offered Preferred Stock, when (i) the Registration
Statement, as finally amended (including all necessary post-effective
amendments), has become effective under the Act; (ii) the Draft
Resolutions have been adopted by the Board of Directors of the Company;
(iii) an appropriate prospectus supplement with respect to the
Depositary Shares has been prepared, delivered and filed in compliance
with the Act and the applicable rules and regulations thereunder; (iv)
the Board of Directors, including any appropriate committee appointed
thereby, and appropriate officers of the Company have taken all
necessary corporate action to approve the issuance and terms of the
Depositary Shares and related matters, including the adoption of the
Certificate of Designation for the related Offered Preferred Stock; (v)
the filing of the Certificate of Designation with the Secretary of
State of the State of Delaware has duly occurred; (vi) the Deposit
Agreement has been duly executed and delivered; (vii) the terms of the
Depositary Shares and of their issuance and sale have been duly
established by all necessary corporate action in conformity with the
Deposit Agreement; (viii) the related Offered Preferred Stock that is
represented by Depositary Shares has been duly authorized, validly
issued and delivered to the Depositary for deposit in accordance with
the laws of the States of Delaware and New York; (ix) if the Depositary
Shares are to be sold pursuant to a firm commitment underwritten
offering, the underwriting agreement with respect to the Depositary
Shares has been duly authorized, executed and delivered by the Company
and the other parties thereto; and (x) the Receipts evidencing the
Depositary Shares are duly issued against the deposit of the Offered
Preferred Stock in accordance with the Deposit Agreement, such Receipts
will be validly issued and will entitle the holders thereof to the
rights specified therein and in the Deposit Agreement, subject to (i)
the effects of bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereinafter in effect relating to creditors'
rights generally and (ii)
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 11
general principles of equity (regardless of whether enforcement is
considered in a proceeding at law or in equity).
There is no provision in the Certificate of Incorporation which
purports to restrict the surplus of the Company by reason of the excess, if any,
of the liquidation preference of the shares of Preferred Stock over their par
value. The applicable provisions of the DGCL, 8 Del. C. Sections 154 and 170(a),
which define capital and surplus of a Delaware corporation available for the
payment of dividends, do not purport to restrict such surplus by reason of any
such excess. Moreover, we are not aware of any applicable provisions of the
Constitution of the State of Delaware nor any controlling Delaware case law
which would suggest that surplus would be restricted by the excess of the
liquidation preference over the par value of the shares of Preferred Stock.
Accordingly, while there are no authorities specifically addressing this issue,
it is our opinion that (i) there should be no restriction upon the surplus of
the Company available for the payment of dividends on any outstanding capital
stock of the Company solely by reason of the fact that the liquidation
preference of any shares of any series of Preferred Stock exceeds the par value
of such shares and (ii) no remedy should be available to the holders of any
shares of any series of Preferred Stock before or after payment of any dividend
solely because such dividend would reduce the surplus of the Company to an
amount less than the amount of such excess, assuming that the payment of such
dividend is in accordance with the provisions of the DGCL, and of the
Certificate of Incorporation including the applicable Certificate of
Designation.
We hereby consent to the filing of this opinion with the Commission as
an exhibit to the Registration Statement. We also hereby consent to the use of
our name under the heading "Legal Matters" in each of the two prospectuses which
forms a part of the Registration Statement. In giving this consent, we do not
thereby admit that we are within the category of persons whose consent is
required under Section
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Citigroup Inc.
Citigroup Capital VII
Citigroup Capital VIII
Citigroup Capital IX
Citigroup Capital X
Citigroup Capital XI
Citigroup Capital XII
Citigroup Capital XIII
March 21, 2001
Page 12
7 of the Act or the rules and regulations of the Commission promulgated
thereunder. This opinion is expressed as of the date hereof unless
otherwise expressly stated, and we disclaim any undertaking to advise
you of any subsequent changes in the facts stated or assumed herein or
of any subsequent changes in applicable law.
Very truly yours,
/s/ Skadden, Arps, Slate, Meagher & Flom LLP