Exhibit 1.06
( ) SECURITIES
CITIGROUP CAPITAL ( )
( )% Capital Securities (TRUPS(R))
$( ) Liquidation Amount
Guaranteed to the extent set forth in the
Prospectus dated , 2006 by
CITIGROUP INC.
UNDERWRITING AGREEMENT
New York, New York
, 20
[The Representatives]
[Address]
as Underwriters named in Schedule I
hereto
Ladies and Gentlemen:
Citigroup Capital ( ) (the "Trust"), a statutory business trust
organized under the Statutory 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 (TruPS(R)) with an aggregate
liquidation amount equal to $( ) (the "Capital Securities") to the several
Underwriters named in Schedule I hereto (the "Underwriters"), for whom you (the
"Representatives") are acting as representatives.
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
December 7, 1998, as amended and restated as of ( ) (the "Declaration"), among
Citigroup Inc., a Delaware corporation (formerly Travelers Group Inc.) (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 "Trust Indenture Act"). Pursuant to the Declaration, the number
of Citigroup Capital Trustees will initially be five. Three of the Citigroup
Capital Trustees (the "Regular Trustees") will be persons who are employees or
officers of the Company. The fourth 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 Trust Indenture Act (the "Institutional
Trustee"). The fifth 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, JPMorgan Chase Bank, a New York banking association
("JPMorgan Chase"), will act
as the Institutional Trustee and Chase Manhattan Bank USA, N.A., 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 JPMorgan Chase, as Trustee (the "Guarantee Trustee"). The assets of
the Trust will consist of ( )% Junior Subordinated Deferrable Interest
Debentures due ( ) (the "Subordinated Debentures") of the Company which will
be issued under an indenture, dated as of July 23, 2004, as supplemented (the
"Indenture"), between the Company and JPMorgan 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."
Any reference herein to the Registration Statement, the Preliminary
Prospectus or the Final Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
which were filed under the Exchange Act on or before the Effective Date of the
Registration Statement or the issue date of the Preliminary Prospectus or the
Final Prospectus, as the case may be; and any reference herein to the terms
"amend," "amendment" or "supplement" with respect to the Registration Statement,
the Preliminary Prospectus or the Final Prospectus shall be deemed to refer to
and include the filing of any document under the Exchange Act after the
Effective Date of the Registration Statement or the issue date of the
Preliminary Prospectus or the Final Prospectus, as the case may be, deemed to be
incorporated therein by reference. Certain terms used herein are defined in
Section 19 hereof.
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. Representations and Warranties. The Offerors jointly and
severally represent and warrant to, and agree with, each Underwriter as set
forth below in this Section 1.
(a) The Offerors meet the requirements for use of Form S-3 under the
Act and have prepared and filed with the Commission an automatic shelf
registration statement, as defined in Rule 405 (File No. 333- ), including
a related prospectus, for registration under the Act of the offering and
sale of the Capital Securities. Such Registration Statement, including any
amendments thereto filed prior to the Execution Time, became effective
upon filing. The Offerors may have filed with the Commission, as part of
an amendment to the Registration Statement or pursuant to Rule 424(b), one
or more prospectus supplements relating to the Capital Securities, each of
which has previously been furnished to you. The Offerors will file with
the Commission a final prospectus supplement relating to the Capital
Securities in accordance with Rule 424(b). As filed, such final prospectus
supplement shall contain all information required by the Act and the rules
thereunder, and, except to the extent the Representatives shall agree in
writing to a modification, shall be in all substantive respects in the
form furnished to you prior to the Execution Time or, to the extent not
completed at the Execution Time, shall contain
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only such specific additional information and other changes (beyond that
contained in the Preliminary Prospectus) as the Offerors have advised you,
prior to the Execution Time, will be included or made therein. The
Registration Statement, at the Execution Time, meets the requirements set
forth in Rule 415(a)(1)(x). The initial Effective Date of the Registration
Statement was not earlier than the date three years before the Execution
Time.
(b) On the Effective Date, the Registration Statement did, and when
the Final Prospectus is first filed in accordance with Rule 424(b) and on
the Closing Date (as defined herein), the Final Prospectus (and any
supplement thereto) will, comply in all material respects with the
applicable requirements of the Act, the Exchange Act and the Trust
Indenture Act and the respective rules thereunder; on the Effective Date
and at the Execution Time, the Registration Statement did not and will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make
the statements therein not misleading; and on the Effective Date and on
the Closing Date the Indenture did or will comply in all material respects
with the applicable requirements of the Trust Indenture Act and the rules
thereunder; on the date of any filing pursuant to Rule 424(b) and on the
Closing Date, the Final Prospectus (together with any supplement thereto)
will not include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that the Offerors make no representations or warranties
as to (i) that part of the Registration Statement which shall constitute
the Statement of Eligibility and Qualification (Form T-1) under the Trust
Indenture Act of the Trustees or (ii) the information contained in or
omitted from the Registration Statement or the Final Prospectus (or any
supplement thereto) in reliance upon and in conformity with information
furnished in writing to the Offerors by or on behalf of any Underwriter
through the Representatives specifically for inclusion in the Registration
Statement or the Final Prospectus (or any supplement thereto), it being
understood and agreed that the only such information furnished by or on
behalf of any Underwriters consists of the information described as such
in Section 8 hereof.
(c) As of the Execution Time, the Disclosure Package and the Final
Term Sheet prepared and filed pursuant to Section 5(b) hereto, when taken
together as a whole, do not contain any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. The preceding sentence does not apply to
statements in or omissions from the Disclosure Package or the Final Term
Sheet based upon and in conformity with written information furnished to
the Offerors by any Underwriter through the Representatives specifically
for use therein, it being understood and agreed that the only such
information furnished by or on behalf of any Underwriter consists of the
information described as such in Section 8 hereof.
(d) (i) At the time of filing the Registration Statement, (ii) at
the time of the most recent amendment thereto for the purposes of
complying with Section 10(a)(3) of the Act (whether such amendment was by
post-effective amendment, incorporated report filed pursuant to Sections
13 or 15(d) of the Exchange Act or form of prospectus), (iii) at
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the time the Offerors or any person acting on their behalf (within the
meaning, for this clause only, of Rule 163(c)) made any offer relating to
the Capital Securities in reliance on the exemption in Rule 163 and (iv)
at the Execution Time (with such date being used as the determination date
for purposes of this clause (iv)), each Offeror was or is, as the case may
be, a "well-known seasoned issuer" as defined in Rule 405. The Offerors
agree to pay the fees required by the Commission relating to the Capital
Securities within the time required by Rule 456(b)(1) without regard to
the proviso therein and otherwise in accordance with Rules 456(b) and
457(r).
(e) (i) At the earliest time after the filing of the Registration
Statement that the Offerors or another offering participant made a bona
fide offer (within the meaning of Rule 164(h)(2)) of the Capital
Securities and (ii) as of the Execution Time (with such date being used as
the determination date for purposes of this clause (ii)), none of the
Offerors were or are an Ineligible Issuer (as defined in Rule 405),
without taking account of any determination by the Commission pursuant to
Rule 405 that it is not necessary that each of the Offerors be considered
an Ineligible Issuer.
(f) Each Issuer Free Writing Prospectus and the Final Term Sheet
prepared and filed pursuant to Section 5(b) hereto does not include any
information that conflicts with the information contained in the
Registration Statement, including any document incorporated therein and
any prospectus or prospectus supplement deemed to be a part thereof that
has not been superseded or modified. The foregoing two sentences do not
apply to statements in or omissions from the Disclosure Package based upon
and in conformity with written information furnished to the Offerors by
any Underwriter through the Representatives specifically for use therein,
it being understood and agreed that the only such information furnished by
or on behalf of any Underwriter consists of the information described as
such in Section 8 hereof.
(g) 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.
(h) 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 the relevant sections 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 in all material respects to all statements
relating thereto contained in the Registration Statement, the Preliminary
Prospectus or the Final 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
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Capital Securities on the New York Stock Exchange has been given, subject
to notice of official issuance.
(i) 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 under the Trust Indenture Act and
conforms in all material respects to the description thereof in the
Registration Statement, the Preliminary Prospectus or the Final
Prospectus, and any amendment or supplement thereto.
(j) 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 Trust Indenture Act and conforms in
all material respects to the description thereof in the Registration
Statement, the Preliminary Prospectus or the Final Prospectus, and any
amendment or supplement thereto.
(k) 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 Trust Indenture Act and conforms in all
material respects to the description thereof in the Registration
Statement, the Preliminary Prospectus or the Final Prospectus, and any
amendment or supplement thereto.
(l) 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, the Preliminary Prospectus or the
Final 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
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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
will be in the form contemplated by, and entitled to the benefits of, the
Indenture and conform in all material respects to the description thereof
in the Registration Statement, the Preliminary Prospectus or the Final
Prospectus, and any amendment or supplement thereto.
(m) The Trust has been duly created and is validly existing and in
good standing as a statutory trust under the Delaware Act with the power
and authority to own property and to conduct its business as described in
the Registration Statement, the Preliminary Prospectus or the Final
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 Preliminary Prospectus and the
Final 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.
(n) 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.
(o) 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.
Any certificate signed by any officer of the Offerors and delivered
to the Representatives or counsel for the Underwriters in connection with the
offering of the Capital Securities shall be deemed a representation and warranty
by the Offerors, as to matters covered thereby, to each Underwriter.
2. Purchase and Sale. Subject to the terms and conditions and in
reliance upon the representations and warranties herein set forth, the Trust
agrees to sell to each Underwriter and each Underwriter agrees, severally and
not jointly, to purchase from the Trust at the purchase price of $ per Capital
Security the number of Capital Securities set forth opposite each Underwriters
name in Schedule I hereto.
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 (as defined below), $ per Capital Security.
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3. Delivery and Payment. Delivery of and payment for the Capital
Securities shall be made at the office of Xxxxxx Xxxxxxxx Xxxxx & Xxxxxxxx LLP,
Xxx Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, at 8:30 A.M., New York City time,
on (the "Closing Date") or at such time on such later date as agreed by the
Representatives and the Offerors. Delivery of the Capital Securities shall be
made to the Representatives for the respective accounts of the several
Underwriters against payment by the several Underwriters directly or through the
Representatives of the net purchase price thereof to or upon the order of the
Offerors by wire transfer payable in same-day funds to an account specified by
the Offerors. Delivery of the Capital Securities shall be made through the
facilities of The Depository Trust Company unless the Representatives shall
otherwise instruct.
It is understood that the Representatives, acting individually and
not in a representative capacity, may (but shall not be obligated to) make
payment to the Offerors on behalf of any other Underwriter for Capital
Securities to be purchased by such Underwriter. Any such payment by the
Representatives shall not relieve any such Underwriter of any of its obligations
hereunder.
4. Offering by Underwriters. It is understood that the several
Underwriters propose to offer the Capital Securities for sale to the public as
set forth in the Final Prospectus. 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.
5. Agreements. The Offerors jointly and severally agree with the
several Underwriters that:
(a) Prior to the termination of the offering of the Capital
Securities, the Offerors will not file any amendment of the Registration
Statement or supplement (including the Final Prospectus) to the
Preliminary Prospectus unless the Offerors have furnished you the
Representatives a copy for your review prior to filing and will not file
any such proposed amendment or supplement to which you reasonably object.
The Offerors will cause the Final Prospectus, properly completed, and any
supplement thereto, to be filed in a form approved by the Representatives
with the Commission pursuant to the applicable paragraph of Rule 424(b)
within the time period prescribed and will provide evidence satisfactory
to the Representatives of such timely filing. The Offerors will promptly
advise the Representatives (i) when the Final Prospectus, and any
supplement thereto, shall have been filed (if required) with the
Commission pursuant to Rule 424(b), (ii) when, prior to termination of the
offering of the Capital Securities, any amendment to the Registration
Statement shall have been filed or become effective, (iii) of any request
by the Commission or its staff for any amendment of the Registration
Statement, or any Rule 462(b) Registration Statement, or for any
supplement to the Final Prospectus or for any additional information, (iv)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any notice objecting to
its use or the institution or threatening of any proceeding for that
purpose and (v) of the receipt by the Offerers of any notification with
respect to the suspension of the qualification of the Capital Securities
for sale in any jurisdiction or the institution or
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threatening of any proceeding for such purpose. The Offerors will use
their best efforts to prevent the issuance of any such stop order or the
occurrence of any such suspension or objection to the use of the
Registration Statement and, upon such issuance, occurrence or notice of
objection, to obtain as soon as possible the withdrawal of such stop order
or relief from such occurrence or objection, including, if necessary, by
filing an amendment to the Registration Statement or a new registration
statement and using their best efforts to have such amendment or new
registration statement declared effective as soon as practicable.
(b) The Offerors will prepare a final term sheet, containing solely
a description of final terms of the Capital Securities and the offering
thereof (the "Final Term Sheet"), in a form approved by you and to file
such term sheet pursuant to Rule 433(d) within the time required by such
Rule.
(c) If, at any time prior to the filing of the Final Prospectus
pursuant to Rule 424(b), any event occurs as a result of which the
Disclosure Package would include any untrue statement of a material fact
or omit to state any material fact necessary to make the statements
therein in the light of the circumstances under which they were made at
such time not misleading, the Offerors will (i) notify promptly the
Representatives so that any use of the Disclosure Package may cease until
it is amended or supplemented; (ii) amend or supplement the Disclosure
Package to correct such statement or omission; and (iii) supply any
amendment or supplement to you in such quantities as you may reasonably
request.
(d) If, at any time when a prospectus relating to the Capital
Securities is required to be delivered under the Act (including in
circumstances where such requirement may be satisfied pursuant to Rule
172), any event occurs as a result of which the Final Prospectus as then
supplemented would include any untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein in the
light of the circumstances under which they were made not misleading, or
if it shall be necessary to amend the Registration Statement, file a new
registration statement or supplement the Final Prospectus to comply with
the Act or the Exchange Act or the respective rules thereunder, including
in connection with use or delivery of the Final Prospectus, the Offerors
promptly will (i) notify the Representatives of such event, (ii) prepare
and file with the Commission, subject to the second sentence of paragraph
(a) of this Section 5, an amendment or supplement or new registration
statement which will correct such statement or omission or effect such
compliance, (iii) use its best efforts to have any amendment to the
Registration Statement or new registration statement declared effective as
soon as practicable in order to avoid any disruption in use of the Final
Prospectus and (iv) supply any supplemented Final Prospectus to you the
Representatives in such quantities as you the Representatives may
reasonably request.
(e) As soon as practicable, but in any event not later than 16
months after the Closing Date, the Offerors will make generally available
to the Trust's security holders and the Representatives a consolidated
earnings statement of the Offerors covering a period of at least 12 months
beginning after the Closing Date and otherwise satisfying Section 11(a) of
the Act.
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(f) Upon request, the Offerors will furnish to the Representatives
and counsel for the Underwriters, without charge, signed copies of the
Registration Statement (including exhibits thereto) and to each other
Underwriter a copy of the Registration Statement (without exhibits
thereto) and, so long as delivery of a prospectus by an Underwriter or
dealer may be required by the Act (including in circumstances where such
requirement may be satisfied pursuant to Rule 172), as many copies of the
Final Prospectus and each Issuer Free Writing Prospectus and any
supplement thereto as the Representatives may reasonably request. The
Offerors will pay the expenses of printing or other production of all
documents relating to the offering that are required to be prepared,
furnished or delivered by it.
(g) The Offerors will arrange, if necessary, for the qualification
of the Capital Securities for sale under the laws of such jurisdictions as
the Representatives reasonably may designate, will maintain such
qualifications in effect so long as required for the distribution of the
Capital Securities and will pay any fee of the National Association of
Securities Dealers, Inc., in connection with its review of the offering;
provided that in no event shall the Offerors be obligated to qualify to do
business in any jurisdiction where it is not now so qualified or to take
any action that 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) (i) Each Offeror agrees that, unless it has obtained or will
obtain, as the case may be, the prior written consent of the
Representatives, and (ii) each Underwriter, severally and not jointly,
agrees with the Offerors jointly and severally that, unless it has
obtained or will obtain, as the case may be, the prior written consent of
the Offerors, it has not made and will not make any offer relating to the
Capital Securities that would constitute an Issuer Free Writing Prospectus
or that would otherwise constitute a "free writing prospectus" (as defined
in Rule 405) required to be filed by the Offerors with the Commission or
retained by the Offerors under Rule 433, other than the information
contained in the Final Term Sheet prepared and filed pursuant to Section
5(b) hereto; provided that the prior written consent of the parties hereto
shall be deemed to have been given in respect of the Free Writing
Prospectuses, if any, included in Schedule II hereto. Any such free
writing prospectus consented to by the Representatives or the Offerors is
hereinafter referred to as a "Permitted Free Writing Prospectus." Each
Offeror agrees that (x) it has treated and will treat, as the case may be,
each Permitted Free Writing Prospectus as an Issuer Free Writing
Prospectus and (y) it has complied and will comply, as the case may be,
with the requirements of Rules 164 and 433 applicable to any Permitted
Free Writing Prospectus, including in respect of timely filing with the
Commission, legending and record keeping.
(i) Each Offeror will not, without the prior written consent of the
Representatives, offer, sell, contract to sell, pledge, or otherwise
dispose of, (or enter into any transaction which is designed to, or might
reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or
otherwise) by such Offeror or any affiliate of such Offeror or any person
in privity with such Offeror or any affiliate of such Offeror) directly or
indirectly, including the filing (or participation in the filing) of a
registration statement with the Commission
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in respect of, or establish or increase a put equivalent position or
liquidate or decrease a call equivalent position within the meaning of
Section 16 of the Exchange Act, any debt securities, including any
guarantee of such securities (other than a guarantee of securities issued
by Citigroup Funding Inc.), of such Offeror, in each case that are
substantially similar to the Capital Securities or any security
convertible into or exchangeable for the Capital Securities or such
substantially similar securities, or publicly announce an intention to
effect any such transaction, until 60 days after the Execution Time.
(j) The Offerors will comply with all applicable securities and
other laws, rules and regulations, including, without limitation, the
Sarbanes Oxley Act of 2002, and use its best efforts to cause its
trustees, directors and officers, in their capacities as such, to comply
with such laws, rules and regulations, including, without limitation, the
provisions of the Sarbanes Oxley Act of 2002.
(k) The Offerors will not take, directly or indirectly, any action
designed to or that would constitute or that might reasonably be expected
to cause or result in, under the Exchange Act or otherwise, stabilization
or manipulation of the price of any security of any of the Offerors to
facilitate the sale or resale of the Capital Securities, except that the
Offerors make no agreement as to the activities of any Underwriter.
6. Conditions to the Obligations of the Underwriters. The
obligations of the Underwriters to purchase the Capital Securities shall be
subject to the accuracy of the representations and warranties on the part of the
Offerors contained herein as of the Execution Time and the Closing Date, to the
accuracy of the statements of the Offerors made in any certificates pursuant to
the provisions hereof, to the performance by the Offerors of their joint and
several obligations hereunder and to the following additional conditions:
(a) The Final Prospectus, and any supplement thereto, have been
filed in the manner and within the time period required by Rule 424(b);
the Final Term Sheet contemplated by Section 5(b) hereto, and any other
material required to be filed by the Offerors pursuant to Rule 433(d)
under the Act, shall have been filed with the Commission within the
applicable time periods prescribed for such filings by Rule 433; and no
stop order suspending the effectiveness of the Registration Statement or
any notice objecting to its use shall have been issued and no proceedings
for that purpose shall have been instituted or threatened.
(b) You shall have received an opinion, dated the Closing Date, of
Skadden, Arps, Slate, Xxxxxxx & Xxxx 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.
(c) You shall have received an opinion, dated the Closing Date, of
counsel for the Company, substantially in the form attached hereto as
Exhibit B.
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(d) You shall have received an opinion, dated the Closing Date, of
Xxxxxxx, Arps, Slate, Xxxxxxx & Xxxx LLP, special tax counsel to the
Company and the Trust, substantially in the form attached hereto as
Exhibit C.
(e) You shall have received an opinion, dated the Closing Date, of
Xxxxx Xxxxxxx Xxxxxxx & Xxxxx LLP, counsel to JPMorgan Chase,
substantially in the form attached hereto as Exhibit D.
(f) You shall have received an opinion, dated the Closing Date, of
Xxxxxx Xxxxxxxx Xxxxx & Xxxxxxxx LLP, counsel for the Underwriters,
substantially in the form attached hereto as Exhibit E.
(g) The Company and the Trust shall each have furnished to the
Representatives a certificate dated the Closing Date, and in the case of
the Company, signed by the Chairman, any Vice Chairman, the President, any
Vice President, the Chief Financial Officer, the Chief Accounting Officer,
the General Counsel, the Controller or any Deputy Controller and by the
Treasurer, any Assistant Treasurer, the Secretary or any Assistant
Secretary 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 Final Prospectus,
the Disclosure Package and any supplements or amendments thereto, and this
Agreement and that:
(i) 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 with all the agreements and satisfied all the conditions on
its part to be performed or satisfied at or prior to the Closing
Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement or any notice objecting to its use has been
issued and no proceedings for that purpose have been instituted or,
to their knowledge, threatened; and
(iii) since the date of the most recent financial statements
included or incorporated by reference in the Final Prospectus
(exclusive of any supplement thereto), there has been no material
adverse effect on the condition (financial or otherwise), prospects,
earnings, business or properties of the Company and its
subsidiaries, taken as a whole, or the Trust, as the case may be,
whether or not arising from transactions in the ordinary course of
business, except as set forth in or contemplated in the Disclosure
Package and the Final Prospectus (exclusive of any supplement
thereto).
(h) The Company shall have requested and caused KPMG LLP to have
furnished to the Representatives, at the Closing Date, a customary
"comfort letter" (which may refer to letters previously delivered to the
Representatives), dated as of the Closing Date, in form and substance
satisfactory to the Representatives.
11
(i) Subsequent to the Execution Time or, if earlier, the dates as of
which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Final Prospectus (exclusive of any supplement
thereto), there shall not have been (i) any change or decrease specified
in the letter or letters referred to in paragraph (h) of this Section 6 or
(ii) any change, or any development involving a prospective change, in or
affecting the condition (financial or otherwise), earnings, business or
properties of the Company and its subsidiaries, taken as a whole, or the
Trust, as the case may be, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated in the
Disclosure Package and the Final Prospectus (exclusive of any supplement
thereto) the effect of which, in any case referred to in clause (i) or
(ii) above, is, in the sole judgment of the Representatives after
consultation with the Company, so material and adverse as to make it
impractical or inadvisable to proceed with the offering or delivery of the
Capital Securities as contemplated by the Registration Statement
(exclusive of any amendment thereof), the Disclosure Package and the Final
Prospectus (exclusive of any supplement thereto) and any Issuer Free
Writing Prospectus.
(j) Subsequent to the Execution Time, there shall not have been any
decrease in the rating of the Capital Securities or the Company's junior
subordinated debt securities by any "nationally recognized statistical
rating organization" (as defined for purposes of Rule 436(g) under the
Act) or any notice given of any intended or potential decrease in any such
rating or of a possible change in any such rating that does not indicate
the direction of the possible change.
(k) Prior to the Closing Date, the Offerors shall have furnished to
the Representatives such further information, certificates and documents
as the Representatives may reasonably request.
If any of the conditions specified in this Section 6 shall not have
been fulfilled when and as provided in this Agreement with respect to the
offering of Capital Securities, or if any of the opinions and certificates
mentioned above or elsewhere in this Agreement shall not be reasonably
satisfactory in form and substance to the Representatives and counsel for the
Underwriters, this Agreement and all obligations of the Underwriters hereunder
may be canceled with respect to such offering at, or at any time prior to, the
Closing Date by the Representatives. Notice of such cancellation shall be given
to the Offerors in writing or by telephone or facsimile confirmed in writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of Xxxxxx Xxxxxxxx Xxxxx & Xxxxxxxx LLP, counsel for the
Underwriters, at Xxx Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the Closing
Date.
7. Reimbursement of Underwriters' Expenses. If the sale of the
Capital Securities provided for herein is not consummated because any condition
to the obligations of the Underwriters set forth in Section 6 hereof is not
satisfied, because of any termination pursuant to Section 10 hereof or because
of any refusal, inability or failure on the part of the Company or the Trust to
perform any agreement herein or comply with any provision hereof other than by
reason of a default by any of the Underwriters, the Company will reimburse the
Underwriters severally through the Representatives on demand for all
out-of-pocket expenses
12
(including reasonable fees and disbursements of counsel) that shall have been
incurred by them in connection with the proposed purchase and sale of the
Capital Securities.
8. Indemnification and Contribution.
(a) Each of the Trust and the Company jointly and severally agrees
to indemnify and hold harmless each Underwriter, the directors, officers,
employees and agents of each Underwriter and each person who controls any
Underwriter within the meaning of either the Act or the Exchange Act
against any and all losses, claims, damages or liabilities, joint or
several, to which they or any of them may become subject under the Act,
the Exchange Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact
contained in the registration statement for the registration of the
Capital Securities as originally filed or in any amendment thereof, or in
the Preliminary Prospectus, the Final Prospectus, any Issuer Free Writing
Prospectus or the information contained in the Final Term Sheet, or in any
amendment thereof or supplement thereto, or arise out of or are based upon
the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein not
misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that neither the Company nor the
Trust will be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information
furnished to the Offerors by or on behalf of any Underwriter through the
Representatives specifically for inclusion therein. This indemnity
agreement will be in addition to any liability which the Trust or the
Company may otherwise have.
(b) Each Underwriter severally and not jointly agrees to indemnify
and hold harmless each of the Trust and the Company, each of its
directors, each of its officers who signs the Registration Statement, and
each person who controls the Trust or the Company within the meaning of
either the Act or the Exchange Act, to the same extent as the foregoing
indemnity from each of the Trust and the Company to each Underwriter, but
only with reference to written information relating to such Underwriter
furnished to the Offerors by or on behalf of such Underwriter through the
Representatives specifically for inclusion in the documents referred to in
the foregoing indemnity. This indemnity agreement will be in addition to
any liability which any Underwriter may otherwise have. Each of the Trust
and the Company acknowledges that the statements set forth in the
second-to-last paragraph of the cover page regarding delivery of the
Capital Securities and, under the heading "Underwriting" or "Plan of
Distribution", (i) the list of Underwriters and their respective
participation in the sale of the Capital Securities, (ii) the sentences
related to concessions and reallowances and (iii) the paragraph related to
stabilization, syndicate covering transactions and penalty bids in the
Final Prospectus constitute the only information furnished in writing by
or on behalf of the several Underwriters for inclusion in the Final
Prospectus.
13
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the commencement thereof; but the failure so to notify the
indemnifying party (i) will not relieve it from liability under paragraph
(a) or (b) above unless and to the extent it did not otherwise learn of
such action and such failure results in the forfeiture by the indemnifying
party of substantial rights and defenses and (ii) will not, in any event,
relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph (a)
or (b) above. The indemnifying party shall be entitled to appoint counsel
of the indemnifying party's choice at the indemnifying party's expense to
represent the indemnified party in any action for which indemnification is
sought (in which case the indemnifying party shall not thereafter be
responsible for the fees and expenses of any separate counsel retained by
the indemnified party or parties except as set forth below); provided,
however, that such counsel shall be satisfactory to the indemnified party.
Notwithstanding the indemnifying party's election to appoint counsel to
represent the indemnified party in an action, the indemnified party shall
have the right to employ separate counsel (including local counsel), and
the indemnifying party shall bear the reasonable fees, costs and expenses
of such separate counsel if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such
counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have
reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to
those available to the indemnifying party, (iii) the indemnifying party
shall not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of
the institution of such action or (iv) the indemnifying party shall
authorize the indemnified party to employ separate counsel at the expense
of the indemnifying party. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise or
consent to the entry of any judgment with respect to any pending or
threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not
the indemnified parties are actual or potential parties to such claim or
action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising
out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a), (b)
or (c) of this Section 8 is unavailable to or insufficient to hold
harmless an indemnified party for any reason, each of the Trust and the
Company and the Underwriters severally agree to contribute to the
aggregate losses, claims, damages and liabilities (including legal or
other expenses reasonably incurred in connection with investigating or
defending same) (collectively "Losses") to which the Trust, the Company
and one or more of the Underwriters may be subject in such proportion as
is appropriate to reflect the relative benefits received by the Company
and the Trust on the one hand and by the Underwriters on the other from
the offering of the Capital Securities; provided, however, that in no case
shall (i) any Underwriter (except as may be provided in any agreement
among underwriters relating to the offering of the Capital Securities) be
responsible for any
14
amount in excess of the underwriting discount or commission applicable to
the Capital Securities purchased by such Underwriter hereunder. If the
allocation provided by the immediately preceding sentence is unavailable
for any reason, the Trust, the Company and the Underwriters severally
shall contribute in such proportion as is appropriate to reflect not only
such relative benefits but also the relative fault of the Trust and the
Company on the one hand and of the Underwriters on the other in connection
with the statements or omissions which resulted in such Losses as well as
any other relevant equitable considerations. Benefits received by the
Trust and the Company shall be deemed to be equal to the total net
proceeds from the offering (before deducting expenses) received by the
Trust, and benefits received by the Underwriters shall be deemed to be
equal to the total underwriting discounts and commissions, in each case as
set forth on the cover page of the Final Prospectus. Relative fault shall
be determined by reference to, among other things, whether any untrue or
any alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information provided by the
Trust and the Company on the one hand or the Underwriters on the other,
the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission. Each of the Trust and the Company and the Underwriters agree
that it would not be just and equitable if contribution were determined by
pro rata allocation or any other method of allocation which does not take
account of the equitable considerations referred to above. Notwithstanding
the provisions of this paragraph (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall
be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 8, each person
who controls an Underwriter within the meaning of either the Act or the
Exchange Act and each director, officer, employee and agent of an
Underwriter shall have the same rights to contribution as such
Underwriter, and each person who controls the Trust or the Company, as
applicable, within the meaning of either the Act or the Exchange Act, each
officer of the Company or Regular Trustee of the Trust who shall have
signed the Registration Statement and each director of the Company shall
have the same rights to contribution as the Trust or the Company, subject
in each case to the applicable terms and conditions of this paragraph (d).
9. Default by an Underwriter. If any one or more Underwriters shall
fail to purchase and pay for any of the Capital Securities agreed to be
purchased by such Underwriter or Underwriters hereunder and such failure to
purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Underwriters shall be obligated
severally to take up and pay for (in the respective proportions which the
principal amount of Capital Securities set forth opposite their names in
Schedule I hereto bears to the aggregate principal amount of Capital Securities
set forth opposite the names of all the remaining Underwriters) the Capital
Securities which the defaulting Underwriter or Underwriters agreed but failed to
purchase; provided, however, that in the event that the aggregate principal
amount of Capital Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase shall exceed 10% of the aggregate principal amount
of Capital Securities set forth in Schedule I hereto, the remaining Underwriters
shall have the right to purchase all, but shall not be under any obligation to
purchase any, of the Capital Securities, and if such nondefaulting Underwriters
do not purchase all the Capital Securities, this Agreement will terminate
without liability to any nondefaulting Underwriter, the Trust or the Company. In
the event of a default
15
by any Underwriter as set forth in this Section 9, the Closing Date shall be
postponed for such period, not exceeding five Business Days, as the
Representatives shall determine in order that the required changes in the
Registration Statement and the Final Prospectus or in any other documents or
arrangements may be effected. Nothing contained in this Agreement shall relieve
any defaulting Underwriter of its liability, if any, to the Offerors and any
nondefaulting Underwriter for damages occasioned by its default hereunder.
10. Termination. This Agreement shall be subject to termination in
the absolute discretion of the Representatives, by notice given to the Offerors
prior to delivery of and payment for the Capital Securities, if at any time
prior to such time (i) trading in the Company's Common Stock shall have been
suspended by the Commission or the New York Stock Exchange, or trading in
Capital Securities generally on the New York Stock Exchange shall have been
suspended or limited or minimum prices shall have been established on such
Exchange, (ii) a banking moratorium shall have been declared either by Federal
or New York State authorities or (iii) there shall have occurred any outbreak or
escalation of hostilities, declaration by the United States of a national
emergency or war, or other calamity or crisis the effect of which on financial
markets is such as to make it, in the sole judgment of the Representatives after
consultation with the Offerors, impractical or inadvisable to proceed with the
offering or delivery of the Capital Securities as contemplated by the Final
Prospectus (exclusive of any supplement thereto).
11. Representations and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the
Offerors or its officers or trustees, as the case may be, and of the
Underwriters set forth in or made pursuant to this Agreement will remain in full
force and effect, regardless of any investigation made by or on behalf of any
Underwriter or the Offerors or any of the officers, directors, trustees,
employees, agents or controlling persons referred to in Section 8 hereof, and
will survive delivery of and payment for the Capital Securities. The provisions
of Sections 7 and 8 hereof shall survive the termination or cancellation of this
Agreement.
12. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telefaxed to the Citigroup Global Markets Inc. General Counsel (fax
no.: (000) 000-0000) and confirmed to the General Counsel, Citigroup Global
Markets Inc., at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention:
General Counsel; if sent to the Offerors, will be mailed, delivered or telefaxed
to Citigroup Inc. -- Treasury Department, 000 X. 00xx Xxxxxx, 0xx Xxxxx, Xxx
Xxxx, Xxx Xxxx 00000 (fax no.: (000) 000-0000), with a copy to 000 Xxxx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: General Counsel, Finance and Capital
Markets (fax no.: (000) 000-0000).
13. Successors. This Agreement will inure to the benefit of and be
binding upon the parties hereto and their respective successors and the
officers, directors, employees, agents and controlling persons referred to in
Section 8 hereof, and no other person will have any right or obligation
hereunder.
14. No Fiduciary Duty. The Offerors hereby acknowledge that (i) the
purchase and sale of the Capital Securities pursuant to this Agreement is an
arm's-length commercial
16
transaction between the Offerors, on the one hand, and the Underwriters and any
affiliate through which it may be acting, on the other, (ii) the Underwriters
are acting as principal and not as an agent or fiduciary of the Offerors and
(iii) the Offerors engagement of the Underwriters in connection with the
offering and the process leading up to the offering is as independent
contractors and not in any other capacity. Furthermore, each of the Offerors
agree that it is solely responsible for making its own judgments in connection
with the offering (irrespective of whether any of the Underwriters has advised
or is currently advising the Offerors on related or other matters). Each of the
Offerors agrees that it will not claim that the Underwriters have rendered
advisory services of any nature or respect, or owe an agency, fiduciary or
similar duty to it, in connection with such transaction or the process leading
thereto.
15. Integration. This Agreement supersedes all prior agreements and
understandings (whether written or oral) among the Offerors and the
Underwriters, or any of them, with respect to the subject matter hereof.
16. Applicable Law. This Agreement will 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.
17. Counterparts. This Agreement may be signed in one or more
counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
18. Headings. The section headings used herein are for convenience
only and shall not affect the construction hereof.
19. Definitions. The terms which follow, when used in this
Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Business Day" shall mean any day other than a Saturday, a Sunday or
a legal holiday or a day on which banking institutions or trust companies
are authorized or obligated by law to close in New York City.
"Commission" shall mean the Securities and Exchange Commission.
"Disclosure Package" shall mean (i) the Preliminary Prospectus, used
most recently prior to the Execution Time, (ii) the Issuer Free Writing
Prospectuses, if any, identified in Schedule II hereto, and (iii) any
other Free Writing Prospectus that the parties hereto shall hereafter
expressly agree in writing to treat as part of the Disclosure Package.
"Effective Date" shall mean each date and time that the Registration
Statement, any post-effective amendment or amendments thereto became or
become effective.
17
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"Final Prospectus" shall mean the prospectus supplement relating to
the Securities that was first filed pursuant to Rule 424(b) after the
Execution Time.
"Free Writing Prospectus" shall mean a free writing prospectus, as
defined in Rule 405.
"Issuer Free Writing Prospectus" shall mean an issuer free writing
prospectus, as defined in Rule 433.
"Preliminary Prospectus" shall mean any preliminary prospectus
supplement to the Base Prospectus referred to in paragraph 1(a) above
which is used prior to filing of the Final Prospectus, together with the
Base Prospectus.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(a) above, including exhibits and financial
statements and any prospectus relating to the Capital Securities that is
filed with the Commission pursuant to Rule 424(b) and deemed part of such
registration statement pursuant to Rule 430B, as amended on each Effective
Date and, in the event any post-effective amendment thereto becomes
effective prior to the Closing Date, shall also mean such registration
statement as so amended.
"Rule 158", "Rule 163", "Rule 164", "Rule 172", "Rule 405", "Rule
415", "Rule 424", "Rule 430B" and "Rule 433" refer to such rules under the
Act.
"Well-Known Seasoned Issuer" shall mean a well-known seasoned
issuer, as defined in Rule 405.
18
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof, whereupon
this letter and your acceptance shall represent a binding agreement among the
Company, the Trust and the several Underwriters.
Very truly yours,
CITIGROUP CAPITAL [ ]
By: ____________________________
Name:
Title:
CITIGROUP INC.
By: ____________________________
Name:
Title:
The foregoing Agreement is
hereby confirmed and accepted
as of the date hereof.
Citigroup Global Markets Inc.
By: Citigroup Global Markets Inc.
By: _____________________________
Name:
Title:
For themselves and the other
several Underwriters, if any,
named in Schedule I
to the foregoing Agreement.
19
SCHEDULE I
Number of Capital
Securities to
Underwriters be Purchased
------------ -----------------
Citigroup Global Markets Inc...........................................................
-----------------
Total.........................................................................
=================
SCHEDULE II
Schedule of Free Writing Prospectuses included in the Disclosure Package
2
