Exhibit 1.05
____________ SECURITIES
CITIGROUP CAPITAL __
___% Capital Securities
$___ Liquidation amount
guaranteed to the extent set forth in the
Prospectus dated ___________, _______ by
CITIGROUP INC.
UNDERWRITING AGREEMENT
Dated:__________________
[Names of Underwriters]
As Representatives of the Several Underwriters
c/o [ ]
Ladies and Gentlemen:
Citigroup Capital __ (the "Trust"), a statutory business trust organized
under the Business Trust Act (the "Delaware Act") of the State of Delaware
(Chapter 38, Title 12, of the Delaware Business Code, 12 Del. C. Section 3801 ET
SEQ.), proposes, upon the terms and conditions set forth herein, to issue and
sell __% Capital Securities with an aggregate liquidation amount equal to
$____________ (the "Capital Securities") to the several Underwriters named in
Schedule I hereto (the "Underwriters").
The Capital Securities and the Common Securities (as defined herein) are to
be issued pursuant to the terms of a declaration of trust, dated as of
__________, _______, as amended and restated as of ________,________ (the
"Declaration"), among Citigroup Inc., a Delaware corporation (the "Company" and,
together with the Trust, the "Offerors"), as sponsor, the trustees named therein
(the "Citigroup Capital Trustees") and the holders from time to time of
undivided
beneficial interests in the assets of the Trust. The Declaration is qualified
as an indenture under the Trust Indenture Act of 1939, as amended (the "1939
Act"). Pursuant to the Declaration, the number of Citigroup Capital Trustees
will initially be four. Two of the Citigroup Capital Trustees (the "Regular
Trustees") will be persons who are employees or officers of the Company. The
third Citigroup Capital Trustee will be a financial institution unaffiliated
with the Company that will serve as property trustee under the Declaration and
as indenture trustee with respect to the Capital Securities for purposes of the
1939 Act (the "Institutional Trustee"). The fourth Citigroup Capital Trustee
will be a financial institution or an affiliate thereof which maintains a
principal place of business in the State of Delaware, meeting the requirements
of the Delaware Act (the "Delaware Trustee"). Initially, The Chase Manhattan
Bank, a New York banking association ("Chase"), will act as the Institutional
Trustee and Chase Manhattan Bank Delaware, a banking association with its
principal place of business in the State of Delaware, will act as the Delaware
Trustee until removed or replaced by the holder of the Common Securities. The
Capital Securities will be guaranteed by the Company on a subordinated basis
with respect to distributions and payments upon liquidation, redemption or
otherwise (the "Guarantee") pursuant to the Capital Securities Guarantee
Agreement dated as of _________,______ (the "Guarantee Agreement") between the
Company and Chase, as Trustee (the "Guarantee Trustee"). The assets of the
Trust will consist of ___% Junior Subordinated Deferrable Interest Debentures
due ________,20______ (the "Subordinated Debentures") of the Company which will
be issued under an indenture, dated as of October 7, 1996 and supplemented by
the First Supplemental Indenture thereto dated as of December 15, 1998 (as
supplemented, the "Indenture"), between the Company and Chase, as Trustee (the
"Indenture Trustee"). Under certain circumstances, the Subordinated Debentures
will be distributable to the holders of undivided beneficial interests in the
assets of the Trust. The Capital Securities, the Guarantee and the Subordinated
Debentures are referred to herein as the "Securities."
The Offerors wish to confirm as follows their agreement with you and the
other several Underwriters on whose behalf you are acting, in connection with
the several purchases of the Capital Securities by the Underwriters.
1. REGISTRATION STATEMENT AND PROSPECTUS. The Offerors have prepared and
filed with the Securities and Exchange Commission (the "Commission") in
accordance with the provisions of the Securities Act of 1933, as amended, and
the rules and regulations of the Commission thereunder
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(collectively, the "Securities Act"), (i) (A) a registration statement on Form
S-3 (File No. 333-52101) under the Securities Act, which was declared effective
by the Commission on June 10, 1998 and (B) a registration statement on Form S-3
(File No. 333-42575) under the Securities Act, which was declared effective by
the Commission on December 30, 1997 (such registration statement, together with
the registration statement referred to in clause (i) (A), the "Prior
Registration Statements" and each individually, a "Prior Registration
Statement"), and (ii) a registration statement on Form S-3 (File No. 333-___)
under the Securities Act (the "registration statement"), including a prospectus
subject to completion relating to the Securities. The term "Registration
Statement" as used in this Agreement means the registration statement (including
all financial schedules and exhibits), as amended at the time it becomes
effective, or, if the registration statement became effective prior to the
execution of this Agreement, as supplemented or amended prior to the execution
of this Agreement and the term "Prior Registration Statement" as used in this
Agreement means each of the Prior Registration Statements, as supplemented or
amended prior to the execution of this Agreement. If it is contemplated, at the
time this Agreement is executed, that a post-effective amendment to the
registration statement will be filed and must be declared effective before the
offering of the Capital Securities may commence, the term "Registration
Statement" as used in this Agreement means the registration statement as amended
by said post-effective amendment. If an additional registration statement is
prepared and filed with the Commission in accordance with Rule 462(b) under the
Securities Act (an "Additional Registration Statement"), the term "Registration
Statement" as used in this Agreement includes the Additional Registration
Statement. The term "Prospectus" as used in this Agreement means the prospectus
dated and filed or to be filed with the Commission pursuant to
Rule 424(b) under the Securities Act together with any amendments or supplements
thereto filed with the Commission. The term "Prepricing Prospectus" as used in
this Agreement means the preliminary prospectus subject to completion dated
relating to the Capital Securities and filed with the Commission
pursuant to Rule 424(b) under the Securities Act. Any reference in this
Agreement to the registration statement, either Prior Registration Statement,
the Registration Statement, any Prepricing Prospectus or
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the Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein pursuant to Form S-3 under the Securities Act,
as of the date of the registration statement, the Prior Registration Statement,
the Registration Statement, such Prepricing Prospectus or the Prospectus, as the
case may be, and any reference to any amendment or supplement to the
registration statement, either Prior Registration Statement, the Registration
Statement, any Prepricing Prospectus or the Prospectus shall be deemed to refer
to and include any documents filed after such date under the Securities Exchange
Act of 1934, as amended, and the rules and regulations of the Commission
thereunder (collectively, the "Exchange Act") which, upon filing, are
incorporated by reference therein, as required by Form S-3. As used herein, the
term "Incorporated Documents" means the documents which at the time are
incorporated by reference in the registration statement, each Prior Registration
Statement, the Registration Statement, any Prepricing Prospectus, the
Prospectus, or any amendment or supplement thereto.
2. AGREEMENTS TO SELL AND PURCHASE. The Trust hereby agrees, subject to
all the terms and conditions set forth herein, to issue and sell to each
Underwriter and, upon the basis of the representations, warranties and
agreements of the Offerors herein contained and subject to all the terms and
conditions set forth herein each Underwriter agrees, severally and not jointly,
to purchase from the Trust, at a purchase price of $_________ per Capital
Security, plus accrued distributions, if any, from ________,_______ the number
of Capital Securities set forth opposite the name of such Underwriter in
Schedule I hereto (or such number of Capital Securities increased as set forth
in Section 10 hereof).
The Company agrees that, in view of the fact that the proceeds of the sale
of the Capital Securities will be invested in the Subordinated Debentures, it
shall pay to the Underwriters as compensation ("Underwriters' Compensation") for
their arranging the investment of the proceeds therein, on the Closing Date,
$_______ per Capital Security, provided, however, that for sales of 10,000 or
more Capital Securities to a single purchaser, such compensation will be $______
per Capital Security. The Underwriters shall inform the Company in writing on
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the Closing Date of the aggregate number of Capital Securities so sold.
3. TERMS OF PUBLIC OFFERING. The Offerors have been advised by you that
the Underwriters propose to make a public offering of their respective portions
of the Capital Securities as soon as the Underwriters deem advisable after the
Registration Statement has become effective, this Agreement has been executed
and delivered, and the Declaration, the Guarantee Agreement and the Indenture
have been qualified under the 1939 Act. The entire proceeds from the sale of
the Capital Securities will be combined with the entire proceeds from the sale
by the Trust to the Company of its common securities (the "Common Securities"),
and will be used by the Trust to purchase an equivalent amount of the
Subordinated Debentures.
4. DELIVERY OF THE CAPITAL SECURITIES AND PAYMENT THEREFOR. Delivery to
the Underwriters of and payment for the Capital Securities shall be made at the
office of _____________________, ____________________, New York, New York _____,
at 8:30 A.M., New York City time, on _________,__________ (the "Closing Date").
The place of closing for the Capital Securities and the Closing Date may be
varied by agreement between you and the Company.
The Capital Securities shall be delivered to you for the accounts of the
several Underwriters registered in the name of CEDE & CO., as nominee for the
Depository Trust Company, against payment of the purchase price therefor in
immediately available funds.
5. AGREEMENTS OF THE OFFERORS. The Offerors jointly and severally agree
with the several Underwriters as follows:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the Registration Statement or a post-effective amendment thereto
or to either Prior Registration Statement (or any Additional Registration
Statement) to be declared or to become effective before the offering of the
Securities may commence, the Offerors will endeavor to cause the Registration
Statement or any such post-effective amendment to become effective as soon as
possible and
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will advise you promptly and, if requested by you, will confirm such advice in
writing, when the Registration Statement or any such post-effective amendment
(or any Additional Registration Statement) has become effective.
(b) The Offerors will advise you promptly and, if requested by you, will
confirm such advice in writing: (i) of any request by the Commission for
amendment of or a supplement to either Prior Registration Statement, the
Registration Statement, any Prepricing Prospectus or the Prospectus or for
additional information; (ii) of the issuance by the Commission of any stop order
suspending the effectiveness of either Prior Registration Statement, the
Registration Statement or of the suspension of qualification of the Securities
for offering or sale in any jurisdiction or the initiation of any proceeding for
such purpose; and (iii) within the period of time referred to in paragraph (f)
below, of the happening of any event which makes any statement of a material
fact made in either Prior Registration Statement, the Registration Statement or
the Prospectus (as then amended or supplemented) untrue or which requires the
making of any additions to or changes in the Registration Statement or the
Prospectus (as then amended or supplemented) in order to state a material fact
required by the Securities Act or the regulations thereunder to be stated
therein or necessary in order to make the statements therein not misleading, or
of the necessity to amend or supplement the Prospectus (as then amended or
supplemented) to comply with the Securities Act or any other law. If at any
time the Commission shall issue any stop order suspending the effectiveness of
either Prior Registration Statement or the Registration Statement, the Offerors
will make every reasonable effort to obtain the withdrawal of such order at the
earliest possible time.
(c) The Offerors will furnish to you, without charge, such number of
copies of the registration statement and each Prior Registration Statement as
filed with the Commission, and such number of copies of the Declaration, the
Guarantee and the Indenture and of the Incorporated Documents, as you may
reasonably request.
(d) Prior to the end of the period of time referred to in the first
sentence in subsection (f) below, the Offerors will not file any amendment to
either Prior Registration Statement, the Registration Statement or any
Additional Registration Statement
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or make any amendment or supplement to the Prospectus to which you shall
reasonably object (other than Form 8-Ks filed in connection with debt offerings
by the Company).
(e) Prior to the execution and delivery of this Agreement, the Offerors
have delivered to you, without charge, in such quantities as you have reasonably
requested, copies of each Prepricing Prospectus. The Offerors consent to the
use, in accordance with the provisions of the Securities Act and with the
securities or Blue Sky laws of the jurisdictions in which the Capital Securities
are offered by the several Underwriters and by dealers, prior to the date of the
Prospectus, of each Prepricing Prospectus so furnished by the Offerors.
(f) As soon after the execution and delivery of this Agreement as possible
and thereafter from time to time for such period as in the opinion of counsel
for the Underwriters a Prospectus is required by the Securities Act to be
delivered in connection with sales by any Underwriter or dealer, the Offerors
will expeditiously deliver to each Underwriter and each dealer, without charge,
as many copies of the Prospectus (and of any amendment or supplement thereto) as
you may reasonably request. The Offerors' consent to the use of the Prospectus
(and of any amendment or supplement thereto) in accordance with the provisions
of the Securities Act and with the securities or Blue Sky laws of the
jurisdictions in which the Capital Securities are offered by the several
Underwriters and by all dealers to whom Capital Securities may be sold, both in
connection with the offering and sale of the Capital Securities and for such
period of time thereafter as the Prospectus is required by the Securities Act to
be delivered in connection with sales by any Underwriter or dealer. If during
such period of time any event shall occur that in the judgment of the Offerors
or in the opinion of counsel for the Underwriters is required to be set forth in
the Prospectus (as then amended or supplemented) or should be set forth therein
in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, or if it is necessary to supplement or
amend the Prospectus (or to file under the Exchange Act any document which, upon
filing, becomes an Incorporated Document) in order to comply with the
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Securities Act or any other law, the Offerors will forthwith prepare and,
subject to the provisions of paragraph (d) above, file with the Commission an
appropriate supplement or amendment thereto (or to such document), and will
expeditiously furnish to the Underwriters and dealers a reasonable number of
copies thereof.
(g) The Offerors will cooperate with you and with counsel for the
Underwriters in connection with the registration or qualification of the
Securities for offering and sale by the several Underwriters and by dealers
under the securities or Blue Sky laws of such jurisdictions as you may designate
and will file such consents to service of process or other documents necessary
or appropriate in order to effect such registration or qualification; provided
that in no event shall the Company or the Trust be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take any
action which would subject it to service of process in suits, other than those
arising out of the offering or sale of the Capital Securities, in any
jurisdiction where it is not now so subject.
(h) The Offerors will make generally available to the Trust's
security holders a consolidated earnings statement, which need not be audited,
covering a twelve-month period commencing after the effective date of the
Registration Statement and ending not later than 15 months thereafter, as soon
as practicable after the end of such period, which consolidated earnings
statement shall satisfy the provisions of Section 11(a) of the Securities Act.
(i) During the period of three years hereafter (i) the Company will
furnish to you, upon your request, from time to time, such information
concerning the Company as you may reasonably request, and (ii) the Trust will
furnish to you, upon your request, a copy of each report of the Trust mailed to
holders of Capital Securities or Common Securities.
(j) If this Agreement shall terminate or shall be terminated after
execution pursuant to any provisions hereof (otherwise than pursuant to the
second paragraph of Section 10 hereof or by notice given by you terminating this
Agreement pursuant to Section 10 or
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Section 11 hereof) or if this Agreement shall be terminated by the Underwriters
because of any failure or refusal on the part of the Offerors to comply with the
terms or fulfill any of the conditions of this Agreement, the Company agrees to
reimburse the Representatives for all reasonable out-of-pocket expenses
(including reasonable fees and expenses of counsel for the Underwriters)
incurred by you in connection herewith.
(k) The Trust will apply the net proceeds from the sale of the
Capital Securities, and the Company will apply the net proceeds from the sale of
the Subordinated Debentures, substantially in accordance with the description
set forth in the Prospectus.
(l) The Offerors will timely file the Prospectus pursuant to Rule
424(b) under the Securities Act.
(m) Each of the Trust and the Company agree, during the period
beginning on the date of this Agreement and continuing to and including the date
that is __ days after the Closing Date, not to offer, sell, contract to offer,
sell or otherwise dispose of any preferred securities, any preferred stock or
any other securities (including any backup undertakings of such preferred
securities, preferred stock or other securities) of the Company or of the Trust,
in each case that are substantially similar to the Capital Securities, or any
securities convertible into or exchangeable for the Capital Securities or such
substantially similar securities of either the Trust or the Company, except
securities in the offering contemplated hereby or with the prior written consent
of __________________.
(n) Except as stated in this Agreement and in the Prepricing
Prospectus and Prospectus, the Company has not taken, nor will it take, directly
or indirectly, any action designed to or that might reasonably be expected to
cause or result in stabilization or manipulation of the price of the Capital
Securities to facilitate the sale or resale of the Capital Securities.
6. REPRESENTATIONS AND WARRANTIES OF THE OFFERORS. The Offerors
jointly and severally represent and warrant to, and agree with, each Underwriter
that:
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(a) The Prior Registration Statements, as of their respective effective
dates and also in such form as they may be when any post-effective amendment
thereto becomes or shall become effective, and the registration statement in the
form in which it became or becomes effective and also in such form as it may be
when any post-effective amendment thereto shall become effective, any Additional
Registration Statement when filed with the Commission pursuant to Rule 462(b)
under the Securities Act and the Prospectus and any supplement or amendment
thereto when filed with the Commission under Rule 424(b) under the Securities
Act complied or will comply in all material respects with the provisions of the
Securities Act and did not and will not at any such times contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except that this representation and warranty does not apply to statements in or
omissions from the registration statement or the Prospectus made in reliance
upon and in conformity with (i) information relating to any Underwriter
furnished to the Offerors in writing by or on behalf of any Underwriter through
you expressly for use therein, or (ii) the Statement of Eligibility and
Qualification (Form T-1) under the 1939 Act of each of the Institutional
Trustee, the Guarantee Trustee and the Indenture Trustee.
(b) The Incorporated Documents heretofore filed, when they were filed (or,
if any amendment with respect to any such document was filed, when such
amendment was filed), conformed in all material respects with the requirements
of the Exchange Act and the rules and regulations thereunder, any further
Incorporated Documents so filed will, when they are filed, conform in all
material respects with the requirements of the Exchange Act and the rules and
regulations thereunder; no such document when it was filed (or, if an amendment
with respect to any such document was filed, when such amendment was filed),
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the statements
therein not misleading; and no such further document, when it is filed, will
contain an untrue statement of a material fact or will omit to state a material
fact required to be stated therein or
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necessary in order to make the statements therein not misleading.
(c) The execution and delivery of, and the performance by the Company and
the Trust of their respective obligations under this Agreement have been duly
and validly authorized by the Company and the Trust, respectively, and this
Agreement has been duly executed and delivered by the Company and the Trust.
(d) The Capital Securities have been duly and validly authorized by the
Declaration and, when executed by the Trust and authenticated by the
Institutional Trustee in accordance with the Declaration and delivered to you
against payment therefor in accordance with the terms hereof, will be validly
issued and (subject to Sections 9.8 and 3.10(vi) of the Declaration) will be
fully paid and non-assessable undivided beneficial interests in the assets of
the Trust, will be entitled to the benefits of the Declaration and will conform
to all statements relating thereto contained in the Registration Statement and
the Prospectus, and any amendment or supplement thereto; the issuance of the
Capital Securities is not subject to preemptive or other similar rights; holders
of Capital Securities will be entitled to the same limitation of personal
liability extended to stockholders of private corporations for profit under the
General Corporation Law of the State of Delaware; and the Capital Securities
have been registered under the Exchange Act and authorization for listing the
Capital Securities on the New York Stock Exchange has been given, subject to
notice of official issuance.
(e) The Declaration has been duly and validly authorized by the Company
and, at the Closing Date, will have been duly executed and delivered by the
Company and the Regular Trustees, and assuming due execution and delivery by the
Institutional Trustee and the Delaware Trustee, the Declaration will be a valid
and legally binding obligation of the Company and the Regular Trustees,
enforceable in accordance with its terms, except as enforcement thereof may be
limited by bankruptcy, insolvency or other similar laws affecting creditors'
rights generally and general principles of equity (regardless of whether
enforceability is considered in a proceeding at law or in equity); and the
Declaration has been (or will have been) duly qualified
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under the 1939 Act and conforms to the description thereof in the Registration
Statement and the Prospectus, and any amendment or supplement thereto.
(f) The Guarantee has been duly and validly authorized by the Company and,
at the Closing Date, will have been duly executed and delivered by the Company,
and assuming due execution and delivery by the Guarantee Trustee, the Guarantee
will be a valid and legally binding obligation of the Company, enforceable in
accordance with its terms, except as enforcement thereof may be limited by
bankruptcy, insolvency or other similar laws affecting creditors' rights
generally and general principles of equity (regardless of whether enforceability
is considered in a proceeding at law or in equity); and the Guarantee has been
(or will have been) duly qualified under the 1939 Act and conforms to the
description thereof in the Registration Statement and the Prospectus, and any
amendment or supplement thereto.
(g) The Indenture has been duly and validly authorized by the Company and,
at the Closing Date, will have been duly executed and delivered by the Company,
and assuming due execution and delivery by the Indenture Trustee, the Indenture
will be a valid and binding obligation of the Company, enforceable in accordance
with its terms, except as enforcement thereof may be limited by bankruptcy,
insolvency or other similar laws affecting creditors' rights generally and
general principles of equity (regardless of whether enforceability is considered
in a proceeding at law or in equity); and the Indenture has been (or will have
been) duly qualified under the 1939 Act and conforms to the description thereof
in the Registration Statement and the Prospectus, and any amendment or
supplement thereto.
(h) The Subordinated Debentures have been duly and validly authorized by
the Company and, when authenticated by the Indenture Trustee in the manner
provided for in the Indenture and issued in accordance with the Indenture and
delivered to the Trust against payment therefor as described in the Registration
Statement and the Prospectus, and any amendment or supplement thereto, will be
valid and legally binding obligations of the Company, enforceable in accordance
with their terms, except as enforcement thereof may be limited by bankruptcy,
insolvency or other similar laws
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affecting creditors' rights generally, and general principles of equity
(regardless of whether enforceability is considered in a proceeding at law or in
equity), and will be in the form contemplated by, and entitled to the benefits
of, the Indenture and conform to the description thereof in the Registration
Statement and the Prospectus, and any amendment or supplement thereto.
(i) The Trust has been duly created and is validly existing and in good
standing as a business trust under the Delaware Act with the power and authority
to own property and to conduct its business as described in the Registration
Statement and Prospectus, and any amendment or supplement thereto, and to enter
into and perform its obligations under this Agreement, the Capital Securities
and the Declaration and is not required to be authorized to do business in any
other jurisdiction; the Trust is not a party to or otherwise bound by any
agreement other than those described in the Prospectus, and any amendment or
supplement thereto; the Trust will be classified as a grantor trust and not as
an association taxable as a corporation for U.S. federal income tax purposes;
and the Trust is and will be treated as a consolidated subsidiary of the Company
pursuant to generally accepted accounting principles.
(j) The Regular Trustees of the Trust are officers of the Company and have
been duly authorized by the Company to execute and deliver the Declaration.
(k) The Company is a corporation duly organized and validly existing in
good standing under the laws of the State of Delaware with full corporate power
and authority to enter into and perform its obligations under this Agreement,
the Declaration, the Indenture, the Guarantee and the Subordinated Debentures,
and to purchase, own and hold the Common Securities issued by the Trust.
(l) The consolidated historical and pro forma financial statements,
together with related schedules and notes, included or incorporated by reference
in the Registration Statement and the Prospectus (and any amendment or
supplement thereto), comply as to form in all material respects with the
requirements of the Securities Act. Such historical financial statements
present fairly the consolidated financial position of the
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Company and its subsidiaries at the respective dates indicated and the results
of their operations and their cash flows for the respective periods indicated in
accordance with generally accepted accounting principles consistently applied
throughout such periods. The pro forma financial statements have been prepared
in accordance with the Commission's rules and guidelines with respect to pro
forma financial statements and have been properly compiled on the basis
described therein, and the assumptions used in the preparation thereof are, in
the Company's opinion, reasonable. The supplemental financial statements
included or incorporated by reference in the Registration Statement and the
Prospectus (and any amendment or supplement thereto) giving retroactive effect
to the merger of a wholly-owned subsidiary of the Company with Citicorp on
October 8, 1998 in a transaction accounted for as a pooling of interests present
fairly the information purported to be shown therein, at the respective dates
and for the respective periods indicated.
(m) The Offerors have not distributed and, prior to the later to occur of
(i) the Closing Date and (ii) completion of the distribution of the Capital
Securities, will not distribute any offering materials in connection with the
offering and sale of the Capital Securities other than the Registration
Statement, the Prepricing Prospectus, the Prospectus or other materials, if any,
permitted by the Securities Act.
(n) No holder of any security of the Company or the Trust has any right to
require registration of the Capital Securities or of any other security of the
Company or the Trust because of the filing of the registration statement or the
consummation of the transactions contemplated by this Agreement.
(o) Neither the Trust nor the Company is now, nor after giving effect to
the transactions contemplated hereby will be, and neither the Trust nor the
Company is controlled by, or acting on behalf of any person which is, an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended.
7. INDEMNIFICATION AND CONTRIBUTION. (a) Each of the Trust and the
Company jointly and severally agrees to indemnify and hold harmless each of you
and
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each other Underwriter and each person, if any, who controls any Underwriter
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act from and against any and all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation)
arising out of or based upon any untrue statement or alleged untrue statement
of a material fact contained in either of the Prior Registration Statements
at their respective effective dates, any Prepricing Prospectus or in the
Registration Statement or the Prospectus or in any amendment or supplement
thereto, or arising out of or based upon any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as such losses,
claims, damages, liabilities or expenses arise out of or are based upon any
untrue statement or omission or alleged untrue statement or omission which
has been made therein or omitted therefrom in reliance upon and in conformity
with the information relating to such Underwriter furnished in writing to the
Offerors by or on behalf of any Underwriter through you expressly for use in
connection therewith; provided, however, that the indemnification contained
in this paragraph (a) with respect to any Prepricing Prospectus shall not
inure to the benefit of any Underwriter (or to the benefit of any person
controlling such Underwriter) to the extent that any such loss, claim,
damage, liability or expense arises from the sale of the Capital Securities
by such Underwriter to any person if it shall be established that a copy of
the Prospectus shall not have been delivered or sent to such person within
the time required by the Securities Act and the regulations thereunder, and
the untrue statement or alleged untrue statement or omission or alleged
omission of a material fact contained in such Prepricing Prospectus was
corrected in the Prospectus and such correction would have cured the defect
giving rise to such loss, claim, damage, liability or expense, provided that
the Offerors have delivered the Prospectus to the several Underwriters in
requisite quantity on a timely basis to permit such delivery or sending. The
foregoing indemnity agreement shall be in addition to any liability which the
Trust or the Company may otherwise have.
(b) If any action, suit or proceeding shall be brought against any
Underwriter or any person controlling any Underwriter in respect of which
indemnity may be
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sought against the Trust or the Company, such Underwriter or such controlling
person shall promptly notify the Trust and the Company, and the Trust or the
Company shall assume the defense thereof, including the employment of counsel
and payment of all fees and expenses. Such Underwriter or any such controlling
person shall have the right to employ separate counsel in any such action, suit
or proceeding and to participate in the defense thereof, but the fees and
expenses of such counsel shall be at the expense of such Underwriter or such
controlling person unless (i) the Trust or the Company has agreed in writing to
pay such fees and expenses, (ii) the Trust or the Company has failed to assume
the defense and employ counsel, or (iii) the named parties to any such action,
suit or proceeding (including any impleaded parties) include both such
Underwriter or such controlling person and the Trust or the Company, and such
Underwriter or such controlling person shall have been advised by its counsel
that representation of such indemnified party and the Trust or the Company by
the same counsel would be inappropriate under applicable standards of
professional conduct (whether or not such representation by the same counsel has
been proposed) due to actual or potential differing interests between them (in
which case the Trust or the Company shall not have the right to assume the
defense of such action, suit or proceeding on behalf of such Underwriter or such
controlling person). It is understood, however, that the Trust and the Company
together shall, in connection with any one such action, suit or proceeding or
separate but substantially similar or related actions, suits or proceedings in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of only one
separate firm of attorneys (in addition to any local counsel) at any time for
all such Underwriters and controlling persons not having actual or potential
differing interests with you or among themselves, which firm shall be designated
in writing by _________________________, and that all such fees and expenses
shall be reimbursed as they are incurred. The Trust and the Company shall not
be liable for any settlement of any such action, suit or proceeding effected
without the Company's written consent, but if settled with such written consent,
or if there be a final judgment for the plaintiff in any such action, suit or
proceeding, the Trust and the Company agree to indemnify and hold harmless any
Underwriter, to the extent provided
16
in the preceding paragraph, and any such controlling person from and against any
loss, claim, damage, liability or expense by reason of such settlement or
judgment.
(c) Each Underwriter agrees, severally and not jointly, to indemnify and
hold harmless the Trust, the Company, the Company's directors, the Company's
officers and the Citigroup Capital Trustees who sign or signed either of the
Prior Registration Statements, the Registration Statement, and any person who
controls the Company within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, to the same extent as the foregoing indemnity
from the Trust and the Company to each Underwriter, but only with respect to
information relating to such Underwriter furnished in writing by or on behalf of
such Underwriter through you expressly for use in either of the Prior
Registration Statements, the Registration Statement, the Prospectus or any
Prepricing Prospectus, or any amendment or supplement thereto. If any action,
suit or proceeding shall be brought against the Trust, the Company, any of the
Company's directors, any such officer or trustee, or any such controlling
person, based on either of the Prior Registration Statements, the Registration
Statement, the Prospectus or any Prepricing Prospectus, or any amendment or
supplement thereto, and in respect of which indemnity may be sought against any
Underwriter pursuant to this paragraph (c), such Underwriter shall have the
rights and duties given to the Trust or the Company by paragraph (b) above
(except that if the Trust or the Company shall have assumed the defense thereof,
such Underwriter shall not be required to do so, but may employ separate counsel
therein and participate in the defense thereof, but the fees and expenses of
such counsel shall be at such Underwriter's expense), and the Trust, the
Company, the Company's directors, any such officer or trustee, and any such
controlling person shall have the rights and duties given to the Underwriters by
paragraph (b) above. The foregoing indemnity agreement shall be in addition to
any liability which the Underwriters may otherwise have.
(d) If the indemnification provided for in this Section 7 is unavailable
to an indemnified party under paragraphs (a) or (c) hereof in respect of any
losses, claims, damages, liabilities or expenses referred to therein, then an
indemnifying party, in lieu of
17
indemnifying such indemnified party, shall contribute to the amount paid or
payable by such indemnified party as a result of such losses, claims, damages,
liabilities or expenses (i) in such proportion as is appropriate to reflect the
relative benefits received by the Trust and the Company on the one hand and the
Underwriters on the other hand from the offering of the Capital Securities, or
(ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault of
the Trust and the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Trust and the
Company on the one hand and the Underwriters on the other shall be deemed to be
in the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Trust bear to the total Underwriting
Compensation received by the Underwriters, in each case as set forth in the
table on the cover page of the Prospectus. The relative fault of the Trust and
the Company on the one hand and the Underwriters on the other hand shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Offerors on the one hand
or by the Underwriters on the other hand and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) The Trust, the Company and the Underwriters agree that it would not be
just and equitable if contribution pursuant to this Section 7 were determined by
a pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in paragraph (d) above. The amount paid
or payable by an indemnified party as a result of the losses, claims, damages,
liabilities and expenses referred to in paragraph (d) above shall be deemed to
include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in
18
connection with investigating any claim or defending any such action, suit or
proceeding. Notwithstanding the provisions of this Section 7, no Underwriter
shall be required to contribute any amount in excess of the amount by which the
total price of the Capital Securities underwritten by it and distributed to the
public exceeds the amount of any damages which such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to this
Section 7 are several in proportion to the respective numbers of Capital
Securities set forth opposite their names in Schedule I hereto (or such numbers
of Capital Securities increased as set forth in Section 10 hereof) and not
joint.
(f) No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement, compromise or consent relating to any
pending or threatened action, suit or proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such settlement, compromise
or consent (i) includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such action, suit or
proceeding and (ii) does not include a statement as to or an admission of fault
or culpability by or on behalf of any indemnified party.
(g) Any losses, claims, damages, liabilities or expenses for which an
indemnified party is entitled to indemnification or contribution under this
Section 7 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 7 and the
representations and warranties of the Trust and the Company set forth in this
Agreement shall remain operative and in full force and effect, regardless of (i)
any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter, the Trust, the Company, the Company's directors or
officers, the
19
Citigroup Capital Trustees, or any person controlling the Company, (ii)
acceptance of any Capital Securities and payment therefor hereunder, and (iii)
any termination of this Agreement. A successor to any Underwriter or any person
controlling any Underwriter, or to the Trust, the Company, the Company's
directors or officers, the Citigroup Capital Trustees, or any person controlling
the Company, shall be entitled to the benefits of the indemnity, contribution,
and reimbursement agreements contained in this Section 7.
8. CONDITIONS OF UNDERWRITERS' OBLIGATIONS. The obligations of the
several Underwriters to purchase and pay for the Securities as provided herein
shall be subject to the accuracy, as of the date of this Agreement and the
Closing Date (as if made at the Closing Date), of the representations and
warranties of the Offerors herein, to the performance by the Offerors of their
obligations hereunder, and to the following additional conditions:
(a) If, at the time this Agreement is executed and delivered, it is
necessary for the registration statement or a post-effective amendment thereto
or to either Prior Registration Statement (or an Additional Registration
Statement) to be declared or to become effective before the offering of the
Capital Securities may commence, the registration statement or any such
post-effective amendment or Additional Registration Statement shall have become
effective not later than 5:30 P.M., New York City time, on the date hereof, or
at such later date and time as shall be consented to in writing by you, and all
filings, if any, required by Rules 424 and 430A under the Securities Act shall
have been timely made; and no stop order suspending the effectiveness of the
registration statement shall have been issued and no proceeding for that purpose
shall have been instituted or, to the knowledge of the Offerors or any
Underwriter, threatened by the Commission, and any request of the Commission for
additional information (to be included in the registration statement or the
Prospectus or otherwise) shall have been complied with to your satisfaction.
(b) Subsequent to the effective date of this Agreement, there shall not
have occurred (i) any change, or any development involving a prospective change,
in or
20
affecting the business or properties of the Company or its subsidiaries which,
in the judgment of a majority in interest of the Underwriters, including the
Representatives, materially impairs the investment quality of the Capital
Securities, or (ii) any event or development relating to or involving the
Company or any officer or director of the Company which makes any statement made
in the Prospectus untrue or which, in the opinion of the Company and its counsel
or the Underwriters and their counsel, requires the making of any addition to or
change in the Prospectus in order to state a material fact required by the
Securities Act or any other law to be stated therein or necessary in order to
make the statements therein not misleading, if amending or supplementing the
Prospectus to reflect such event or development would, in your opinion, as
Representatives of the several Underwriters, materially adversely affect the
market for the Capital Securities.
(c) You shall have received an opinion, dated the Closing Date, of
Skadden, Arps, Slate, Meagher & Flom LLP, special counsel to the Offerors,
substantially in the form attached hereto as Exhibit A. Insofar as such opinion
involves factual matters, such counsel may rely, to the extent such counsel
deems proper, upon certificates of officers of the Company, its subsidiaries and
the Trust and certificates of public officials.
(d) You shall have received an opinion, dated the Closing Date, of
Stephanie B. Mudick, Esq., General Counsel-Corporate Law of the Company,
substantially in the form attached hereto as Exhibit B.
(e) You shall have received an opinion, dated the Closing Date, of
Skadden, Arps, Slate, Meagher & Flom LLP, special tax counsel to the Company and
the Trust, substantially in the form attached hereto as Exhibit C.
(f) You shall have received an opinion, dated the Closing Date, of Pryor,
Cashman, Sherman & Flynn (or other counsel reasonably acceptable to you),
counsel to Chase, substantially in the form attached hereto as Exhibit D.
(g) You shall have received an opinion, dated the Closing Date, of Dewey
Ballantine LLP, counsel for
21
the Underwriters, substantially in the form attached hereto as Exhibit E.
(h) The Company and the Trust shall each have furnished to you a
certificate, dated the Closing Date, and, in the case of the Company, signed by
two officers of the Company, at least one of which will be the principal
financial or accounting officer of the Company and, in the case of the Trust,
signed by one of the Regular Trustees to the effect that the signers of such
certificate have carefully examined the Registration Statement, the Prospectus
and this Agreement and that:
(1) the representations and warranties of the Company or the Trust,
as the case may be, in this Agreement are true and correct on and as of the
Closing Date with the same effect as if made on the Closing Date, and the
Company or the Trust, as the case may be, has complied in all material
respects with all the agreements and satisfied all the conditions on its
part to be performed or satisfied by it hereunder at or prior to the
Closing Date;
(2) no stop order suspending the effectiveness of Registration
Statement or either Prior Registration Statement has been issued, and no
proceedings for that purpose have been instituted or, to their knowledge,
threatened;
(3) none of the Registration Statement or either Prior Registration
Statement, including, in each case, any supplements or amendments thereto,
contains any untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the
statements therein not misleading; the Prospectus, including any
supplements or amendments thereto, does not contain any untrue statement of
a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and since the
effective date of the Registration Statement there has not occurred any
event concerning which information is required to be contained in an
amended or supplemented Prospectus concerning which such information is not
contained therein; and
22
(4) there have been no material adverse changes in the general
affairs of the Company and its subsidiaries taken as a whole or the Trust,
as the case may be, or in their financial position as shown by information
contained in the Registration Statement, the Prior Registration Statements
and the Prospectus, other than changes disclosed in or contemplated by the
Registration Statement, the prior Registration Statements and the
Prospectus.
(i) You shall have received on the Closing Date a letter or letters,
as required by you, from KPMG Peat Marwick LLP, an independent public accounting
firm of the Offerors (or from an independent public accounting firm or firms of
any subsidiary or business acquired by any of the Offerors for which financial
statements and financial data are included or incorporated by reference in the
Prospectus), dated the Closing Date, substantially in the form heretofore
approved by you.
(j) On or after the date of this Agreement no downgrading shall have
occurred in the rating accorded the Capital Securities or the Company's debt
securities by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Securities Act).
(k) The Capital Securities shall have been registered under the
Exchange Act and shall have been listed or approved for listing, upon notice of
issuance, on the New York Stock Exchange.
(l) Prior to the Closing Date, the Company shall have furnished to
you such further information, certificates and documents as you may reasonably
request.
9. EXPENSES. The Company agrees to pay the following costs and
expenses and all other costs and expenses incident to the performance by it and
by the Trust of its and the Trust's respective and joint obligations hereunder:
(i) the preparation, printing or reproduction, and filing (including filing
fees) with the Commission of the registration statement (including financial
statements and exhibits thereto), each of the Prior Registration Statements,
each Prepricing Prospectus, the Prospectus, each amendment or supplement
23
to any of them, this Agreement, the Declaration, the Guarantee, the Indenture
and the Statement of Eligibility and Qualification of each of the Institutional
Trustee, the Guarantee Trustee and the Indenture Trustee; (ii) the printing (or
reproduction) and delivery (including postage, air freight charges and charges
for counting and packaging) of such copies of the registration statement, each
Prepricing Prospectus, the Prospectus, the documents incorporated by reference
in the Registration Statement, and all amendments or supplements to any of them,
as may be reasonably requested for use in connection with the offering and sale
of the Capital Securities; (iii) the preparation, printing (or reproduction),
execution and delivery of the Declaration, the Guarantee and the Indenture and
the preparation, printing, authentication, issuance and delivery of the
Securities, including any stamp taxes in connection with the original issuance
and sale of the Capital Securities; (iv) the printing (or reproduction) and
delivery of this Agreement, the preliminary and supplemental Blue Sky Memoranda
and all other agreements or documents printed (or reproduced) and delivered in
connection with the offering of the Capital Securities; (v) the registration of
the Securities under the Exchange Act and the listing of the Capital Securities
on the New York Stock Exchange; (vi) the registration or qualification of the
Securities for offer and sale under the securities or Blue Sky laws of the
several states as provided in Section 5(g) hereof (including the reasonable
fees, expenses and disbursements of counsel for the Underwriters relating to the
preparation, printing (or reproduction), and delivery of the preliminary and
supplemental Blue Sky Memoranda and such registration and qualification); (vii)
the filing fees and the reasonable fees and expenses of counsel for the
Underwriters in connection with any filings required to be made with the
National Association of Securities Dealers, Inc.; (viii) the fees and expenses
of the Institutional Trustee, the Delaware Trustee, the Guarantee Trustee and
the Indenture Trustee; (ix) the fees and expenses associated with obtaining
ratings for the Capital Securities from nationally recognized statistical rating
organizations; (x) the transportation and other expenses incurred by or on
behalf of representatives of the Offerors (other than the Underwriters and their
representatives) in connection with presentations to prospective purchasers of
the Capital Securities; and (xi) the fees and expenses of the
24
Company's accountants and the fees and expenses of counsel (including local and
special counsel) for the Offerors.
10. EFFECTIVE DATE OF AGREEMENT. This Agreement shall become effective:
(i) upon the execution and delivery hereof by the parties hereto; or (ii) if, at
the time this Agreement is executed and delivered, it is necessary for the
registration statement or a post-effective amendment thereto or to either Prior
Registration Statement or an Additional Registration Statement to be declared
effective before the offering of the Capital Securities may commence, when
notification of the effectiveness of the registration statement or such
post-effective amendment has been released by the Commission or, in the case of
an Additional Registration Statement, upon the filing of such Additional
Registration Statement. Until such time as this Agreement shall have become
effective, it may be terminated by the Company or the Trust, by notifying you,
or by you, as Representatives of the several Underwriters, by notifying the
Offerors.
If any one or more of the Underwriters shall fail or refuse to purchase
Capital Securities which it or they are obligated to purchase hereunder, and the
aggregate number of Capital Securities which such defaulting Underwriter or
Underwriters are obligated but fail or refuse to purchase is not more than
one-tenth of the aggregate number of the Capital Securities, each non-defaulting
Underwriter shall be obligated, severally, in the proportion which the number of
Capital Securities set forth opposite its name in Schedule I hereto bears to the
aggregate number of Capital Securities set forth opposite the names of all
non-defaulting Underwriters, to purchase the Capital Securities which such
defaulting Underwriter or Underwriters are obligated, but fail or refuse, to
purchase. If any Underwriter or Underwriters shall fail or refuse to purchase
Capital Securities and the aggregate number of Capital Securities with respect
to which such default occurs is more than one-tenth of the aggregate number of
the Capital Securities and arrangements satisfactory to you and the Offerors for
the purchase of such Capital Securities by one or more non-defaulting
Underwriters or other party or parties approved by you and the Offerors are not
made within 36 hours after such default, this Agreement will terminate
25
without liability on the part of any non-defaulting Underwriter or the Offerors.
In any such case which does not result in termination of this Agreement, either
you or the Offerors shall have the right to postpone the Closing Date, but in no
event for longer than seven days, in order that the required changes, if any, in
the Registration Statement, the Prior Registration Statements and the Prospectus
or any other documents or arrangements may be effected. Any action taken under
this paragraph shall not relieve any defaulting Underwriter from liability in
respect of any such default of any such Underwriter under this Agreement. The
term "Underwriter" as used in this Agreement includes, for all purposes of this
Agreement, any party not listed in Schedule I hereto who, with your approval and
the approval of the Offerors, purchases Capital Securities which a defaulting
Underwriter is obligated, but fails or refuses, to purchase.
Any notice under this Section 10 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
11. TERMINATION OF AGREEMENT. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Offerors, by notice to the Offerors, if prior to the Closing
Date there shall have occurred: (i) any suspension or limitation of trading in
securities generally on the New York Stock Exchange, or any setting of minimum
prices for trading on such exchange, or any suspension of trading of any
securities of the Company on any exchange or in the over-the-counter market;
(ii) any banking moratorium declared by Federal or New York authorities; or
(iii) any outbreak or escalation of major hostilities in which the United States
is involved, any declaration of war by Congress or any other substantial
national or international calamity or emergency if, in the judgment of a
majority in interest of the Underwriters, including the Representatives, the
effect of any such outbreak, escalation, declaration, calamity or emergency
makes it impractical or inadvisable to proceed with completion of the sale of
and payment for the Securities. Notice of such termination may be given to the
Company by telegram, telecopy or telephone and shall be subsequently confirmed
by letter.
26
12. INFORMATION FURNISHED BY THE UNDERWRITERS. The statements set forth
in the first paragraph (including the table) and the fifth, sixth, eighth,
ninth, tenth and eleventh paragraphs under the caption "Underwriting" in the
Prospectus constitute the only information furnished by or on behalf of the
Underwriters through you as such information is referred to in Sections 6(b) and
7 hereof.
13. MISCELLANEOUS. Except as otherwise provided herein, notice given
pursuant to any provision of this Agreement shall be in writing and shall be
delivered (i) if to the Offerors, to the Company, or to the Trust care of the
Company, at the office of the Company at 153 East 53rd Street, New York, NY
10043, Attention: Stephanie B. Mudick, with a copy to Skadden, Arps, Slate,
Meagher & Flom LLP, 919 Third Avenue, New York, New York 10022, Attention:
Gregory A. Fernicola; or (ii) if to you, as Representatives of the several
Underwriters, care of ____________________, __________________,_______,
___________, Attention: _____________________ ____________, with a copy to
_________________________, and to Dewey Ballantine LLP, 1301 Avenue of the
Americas, New York, New York 10019, Attention: Frederick W. Kanner.
This Agreement has been and is made solely for the benefit of the several
Underwriters, the Trust, the Company, the Company's directors and officers, the
Citigroup Capital Trustees, and the other controlling persons referred to in
Section 7 hereof and their respective successors and assigns, to the extent
provided herein, and no other person shall acquire or have any right under or by
virtue of this Agreement. Neither the term "successor" nor the term "successors
and assigns" as used in this Agreement shall include a purchaser from any
Underwriter of any of the Capital Securities in his status as such purchaser.
14. APPLICABLE LAW; COUNTERPARTS. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
This Agreement may be signed in various counterparts which together
constitute one and the same
27
instrument. If signed in counterparts, this Agreement shall not become
effective unless at least one counterpart hereof shall have been executed and
delivered on behalf of each party hereto.
28
Please confirm that the foregoing correctly sets forth the agreement among
the Trust, the Company and the several Underwriters.
Very truly yours,
CITIGROUP CAPITAL
By:
---------------------------
as Regular Trustee
By:
---------------------------
as Regular Trustee
CITIGROUP INC.
By:
---------------------------
Name:
Title:
Confirmed as of the date first
above mentioned on behalf of
themselves and the other several
Underwriters named in Schedule I
hereto.
[Names of the Underwriters]
As Representatives of the Several Underwriters
By:
---------------------------
By:
---------------------------
Authorized Signatory
29
SCHEDULE I
CITIGROUP CAPITAL ____
___% Capital Securities
NUMBER OF
UNDERWRITERS CAPITAL SECURITIES
------------ ------------------
30