PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED AUGUST 22, 1996
$200,000,000
[LOGO]
7 1/4% SUBORDINATED NOTES DUE SEPTEMBER 1, 2008
-----------
Interest on the Subordinated Notes is payable semiannually on September 1
and March 1, commencing March 1, 1997. The Subordinated Notes will mature on
September 1, 2008 and will not be subject to redemption by Citicorp prior to
Maturity. See "Supplemental Description of Subordinated Notes".
The Subordinated Notes are unsecured and subordinated obligations of
Citicorp as described in the accompanying Prospectus under "Description of
Notes". Payment of the principal of the Subordinated Notes may be accelerated
only in the case of certain events involving the bankruptcy, insolvency or
reorganization of Citicorp. There is no right of acceleration in the case of
default in the performance of any covenant of Citicorp, including the payment of
principal or interest. See "Description of Notes - Defaults; Events of Default"
in the Prospectus.
The Subordinated Notes will be represented by one or more Global Securities
registered in the name of The Depository Trust Company, as depositary, or its
nominee. Beneficial interests in the Global Securities will be shown on, and
transfers thereof will be effected only through, records maintained by the
Depositary and its participants. Except as described under "Supplemental
Description of Subordinated Notes - Book-Entry System", Subordinated Notes in
definitive form will not be issued. The Subordinated Notes will be issued only
in registered form in denominations of $1,000 and integral multiples thereof.
See "Supplemental Description of Subordinated Notes - Book-Entry System".
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-----------
THE SUBORDINATED NOTES OFFERED HEREBY ARE NOT DEPOSITS OR SAVINGS
ACCOUNTS BUT ARE UNSECURED DEBT OBLIGATIONS OF CITICORP AND ARE
NOT INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR
ANY OTHER GOVERNMENTAL AGENCY OR
INSTRUMENTALITY.
<TABLE>
<CAPTION>
================================================================================================
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE (1) DISCOUNT (2) CITICORP (1)(3)
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Subordinated Note .......... 99.115% 0.675% 98.44%
- ------------------------------------------------------------------------------------------------
Total .......................... $198,230,000 $1,350,000 $196,880,000
================================================================================================
</TABLE>
(1) Plus accrued interest, if any, from August 27, 1996.
(2) Citicorp has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933. See
"Underwriting".
(3) Before deduction of expenses payable by Citicorp.
-----------
The Subordinated Notes offered hereby are offered severally by the
Underwriters, as specified herein, subject to receipt and acceptance by them and
subject to their right to reject any order in whole or in part. It is expected
that the Subordinated Notes will be ready for delivery in book-entry form only
through the facilities of The Depository Trust Company in New York, New York on
or about August 27, 1996, against payment therefor in immediately available
funds.
CITICORP SECURITIES, INC.
LEHMAN BROTHERS
MERRILL LYNCH & CO.
The date of this Prospectus Supplement is August 22, 1996.
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SUBORDINATED
NOTES OFFERED HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE
OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
FOR NORTH CAROLINA RESIDENTS: THE COMMISSIONER OF INSURANCE OF THE STATE OF
NORTH CAROLINA HAS NOT APPROVED OR DISAPPROVED THIS OFFERING NOR HAS THE
COMMISSIONER PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT
OR THE PROSPECTUS.
S-2
<PAGE>
SUPPLEMENTAL DESCRIPTION OF SUBORDINATED NOTES
GENERAL
The 7 1/4% Subordinated Notes due September 1, 2008 (the "Subordinated
Notes") offered hereby will be issued under the Indenture (the "Original
Indenture"), dated as of April 1, 1991, between Citicorp and The Chase Manhattan
Bank (formerly known as Chemical Bank), as Trustee, as supplemented by a First
Supplemental Indenture (the "First Supplemental Indenture"), dated as of
November 27, 1992, between Citicorp and the Trustee (the Original Indenture
together with the First Supplemental Indenture, the "Indenture"), referred to in
the accompanying Prospectus. Capitalized terms used and not defined herein shall
have the meanings assigned to them in the accompanying Prospectus and in the
Indenture.
The Subordinated Notes will constitute a single series for purposes of the
Indenture and will be limited to $200,000,000 aggregate principal amount. The
Subordinated Notes will mature on September 1, 2008 and interest will accrue
from August 27, 1996 at the rate per annum shown on the front cover of this
Prospectus Supplement, payable semiannually on September 1 and March 1 of each
year, commencing March 1, 1997, and at Maturity, to the Person in whose name the
Subordinated Note (or any predecessor Subordinated Note) is registered at the
close of business on the August 15 or February 15 next preceding such Interest
Payment Date. The Subordinated Notes will not be subject to any sinking fund or
provide for redemption at the option of Citicorp or the Holder prior to
Maturity. The Subordinated Notes will be issued in the form of one or more
permanent global notes registered in the name of The Depository Trust Company,
as depositary (the "Depositary"), or its nominee, located in the Borough of
Manhattan, The City of New York.
The provisions of the Indenture described under "Description of Notes -
Defeasance and Covenant Defeasance" in the accompanying Prospectus apply to the
Subordinated Notes.
For a description of the rights attaching to different series of
Subordinated Notes under the Indenture (including the Subordinated Notes), see
"Description of Notes" in the accompanying Prospectus.
BOOK-ENTRY SYSTEM
The Subordinated Notes will be issued in the form of one or more permanent
global securities (the "Global Securities"), which will be deposited with, or on
behalf of, the Depositary and will be registered in the name of the Depositary
or a nominee of the Depositary. Except as set forth below, the Subordinated
Notes will be available for purchase in denominations of $1,000 and integral
multiples thereof in book-entry form only.
Ownership of Subordinated Notes will be limited to institutions that have
accounts with such Depositary or its nominee ("participants") or persons that
may hold interests through participants. In addition, ownership of Subordinated
Notes by participants will only be evidenced by, and the transfer of that
ownership interest will be effected only through, records maintained by the
Depositary or its nominee, as the case may be. Ownership of Subordinated Notes
by persons that hold through participants will only be evidenced by, and the
transfer of that ownership interest within such participant will be effected
only through, records maintained by such participant. The laws of some
jurisdictions require that certain purchasers of securities take physical
delivery of such securities in definitive form. Such laws may impair the ability
to transfer Subordinated Notes.
Citicorp has been advised by the Depositary that upon the issuance of the
Global Securities, and the deposit of such Global Securities with or on behalf
of the Depositary, the Depositary will immediately credit, on its book-entry
registration and transfer system, the respective principal amounts of the
Subordinated Notes represented by the Global Securities to the accounts of
participants. The accounts to be credited shall be designated by the
Underwriters.
Payments of principal of and interest on the Subordinated Notes represented
by the Global Securities registered in the name of or held by the Depositary or
its nominee will be made to the Depositary or its nominee, as the case may be,
as the registered owner and the Holder of the Subordinated Notes represented by
the Global Securities. Such payments to the Depositary or its nominee, as the
case may be, will be made in immediately available funds at the offices of
Citibank, as Paying Agent, in the Borough of Manhattan, The City of New York,
provided that, in the case of
S-3
<PAGE>
payments of principal, the Global Securities are presented to the Paying Agent
in time for the Paying Agent to make such payments in such funds in accordance
with its normal procedures. None of Citicorp, the Trustee or any agent of
Citicorp or the Trustee will have any responsibility or liability for any aspect
of the Depositary's records or any participant's records relating to or payments
made on account of beneficial ownership interests in the Subordinated Notes
represented by the Global Securities or for maintaining, supervising or
reviewing any of the Depositary's records or any participant's records relating
to such beneficial ownership interests.
Citicorp has been advised by the Depositary that upon receipt of any
payment of principal of or interest in respect of the Global Securities, the
Depositary will immediately credit, on its book-entry registration and transfer
system, accounts of participants with payments in amounts proportionate to their
respective beneficial interests in Subordinated Notes represented by the Global
Securities as shown on the records of the Depositary. Payments by participants
to owners of the Subordinated Notes held through such participants will be
governed by standing instructions and customary practices, as is now the case
with securities held for the accounts of customers registered in "street name",
and will be the responsibility of such participants.
The Global Securities may not be transferred except as a whole by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
another nominee of the Depositary.
Subordinated Notes represented by the Global Securities are exchangeable
for definitive Subordinated Notes in registered form, of like tenor and of an
equal aggregate principal amount, only if (x) the Depositary notifies Citicorp
that it is unwilling or unable to continue as Depositary for the Global
Securities or if at any time the Depositary ceases to be a clearing agency
registered under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), (y) Citicorp in its sole discretion determines that such Subordinated
Notes shall be exchangeable for definitive Subordinated Notes in registered form
or (z) any event shall have happened and be continuing which, after notice or
lapse of time, or both, would become an Event of Default with respect to the
Subordinated Notes. If the Global Securities become exchangeable pursuant to the
preceding sentence, they shall be exchangeable in whole for definitive
Subordinated Notes in registered form, of like tenor and of an equal aggregate
principal amount, in denominations of $1,000 and integral multiples thereof and
may be presented for registration of transfer or exchange at the offices of
Citibank in the Borough of Manhattan, The City of New York. Such definitive
Subordinated Notes shall be registered in the name or names of such person or
persons as the Depositary shall instruct the Security Registrar. It is expected
that such instructions may be based upon directions received by the Depositary
from its participants with respect to ownership of Subordinated Notes.
Except as provided above, owners of Subordinated Notes will not be entitled
to receive physical delivery of Subordinated Notes in definitive form and will
not be considered the Holders thereof for any purpose under the Indenture, and
the Global Securities shall not be exchangeable, except for another Global
Security of like denomination and tenor to be registered in the name of the
Depositary or its nominee. Accordingly, each person owning a Subordinated Note
must rely on the procedures of the Depositary and, if such person is not a
participant, on the procedures of the participant through which such person owns
its interest, to exercise any rights of a Holder under the Indenture. The
Indenture provides that the Depositary, as a Holder, may appoint agents and
otherwise authorize participants to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action which a Holder
is entitled to give or take under the Indenture. Citicorp understands that under
existing industry practices, in the event that Citicorp requests any action of
Holders or an owner of a Subordinated Note desires to give or take any action a
Holder is entitled to give or take under the Indenture, the Depositary would
authorize the participants owning the relevant Subordinated Notes to give or
take such action, and such participants would authorize beneficial owners owning
through such participants to give or take such action or would otherwise act
upon the instructions of beneficial owners owning through them.
The Depositary has advised Citicorp that the Depositary is a
limited-purpose trust company organized under the laws of the State of New York,
a member of the Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered under the Exchange Act. The Depositary was created to hold securities
of its participants and to facilitate the clearance and settlement of securities
transactions among its participants in such securities through electronic
book-entry changes in accounts of the participants, thereby eliminating the need
for physical movement of securities certificates. The Depositary's participants
include securities brokers and dealers (including the Underwriters), banks,
trust companies, clearing
S-4
<PAGE>
corporations, and certain other organizations, some of whom (and/or their
representatives) own the Depositary. Access to the Depositary's book-entry
system is also available to others, such as banks, brokers, dealers and trust
companies that clear through or maintain a custodial relationship with a
participant, either directly or indirectly.
Settlement for the Subordinated Notes will be made in same day funds. All
payments of principal and interest will be made by Citicorp in same day funds.
The Subordinated Notes will trade in the Same-Day Funds Settlement System of the
Depositary until Maturity, and secondary market trading activity for the
Subordinated Notes will therefore settle in same day funds.
S-5
<PAGE>
SUMMARY FINANCIAL DATA
The following table sets forth, in summary form, certain financial data for
each of the years in the three-year period ended December 31, 1995 and for the
six months ended June 30, 1996 and June 30, 1995. This summary is qualified in
its entirety by the detailed information and financial statements included in
the documents incorporated by reference; this summary is not covered by the
Report of Independent Auditors incorporated herein by reference. See
"Incorporation of Certain Documents by Reference" in the Prospectus. The
consolidated financial data at and for the six months ended June 30, 1996 and
June 30, 1995 is derived from unaudited financial statements. The results for
the six months ended June 30, 1996 are not necessarily indicative of the results
for the full year or any other interim period.
<TABLE>
<CAPTION>
Six Months Ended
June 30, Year Ended December 31,
------------------- -----------------------------
1996 1995 1995 1994 1993
------ ------ ------ ------ ------
(unaudited)
<S> <C> <C> <C> <C> <C>
(In millions, except per share amounts)
Net Interest Revenue ........................... $5,413 $4,793 $ 9,951 $ 8,911 $ 7,690
Fees, Commissions and Other Revenue ............ 4,408 4,339 8,727 7,837 8,385
------ ------ ------ ------- -------
Total Revenue ................................ 9,821 9,132 18,678 16,748 16,075
Provision for Credit Losses .................... 973 884 1,991 1,881 2,600
Operating Expense .............................. 5,838 5,491 11,102 10,256 10,615
------ ------ ------ ------- -------
Income Before Taxes and Cumulative Effects of
Accounting Changes ............................ 3,010 2,757 5,585 4,611 2,860
Income Taxes ................................... 1,144 1,075 2,121 1,189 941
------ ------ ------ ------- -------
Income Before Cumulative Effects of
Accounting Changes ............................ 1,866 1,682 3,464 3,422 1,919
Cumulative Effects of Accounting Changes(A) .... -- -- -- (56) 300
------ ------ ------ ------- -------
Net Income ..................................... $1,866 $1,682 $ 3,464 $ 3,366 $ 2,219
====== ====== ======= ======= =======
Income Applicable to Common Stock .............. $1,785 $1,492 $ 3,126 $ 3,010 $ 1,900
====== ====== ======= ======= =======
Earnings Per Share(B):
On Common and Common Equivalent Shares:
Income Before Cumulative Effects of
Accounting Changes .......................... $ 3.68 $ 3.47 $ 7.21 $ 7.15 $ 3.82
Cumulative Effects of Accounting Changes(A) .. -- -- -- (.12) .68
------ ------ ------ ------- -------
Net Income ................................... $ 3.68 $ 3.47 $ 7.21 $ 7.03 $ 4.50
====== ====== ======= ======= =======
Assuming Full Dilution:
Income Before Cumulative Effects of
Accounting Changes .......................... $ 3.61 $ 3.09 $ 6.48 $ 6.40 $ 3.53
Cumulative Effects of Accounting Changes(A) .. -- -- -- (.11) .58
------ ------ ------ ------- -------
Net Income ................................... $ 3.61 $ 3.09 $ 6.48 $ 6.29 $ 4.11
====== ====== ======= ======= =======
Period End Balances: ........................... (In billions)
Total Loans, Net(C) ......................... $167.9 $165.6 $ 165.6 $ 152.4 $ 139.0
Total Assets(D) ............................. 266.8 256.9 256.9 250.5 216.6
Total Deposits .............................. 175.8 167.1 167.1 155.7 145.1
Long-Term Debt and Subordinated Capital Notes 19.5 18.5 18.5 17.9 18.2
Total Stockholders' Equity(E) ............... 19.9 19.6 19.6 17.8 14.0
</TABLE>
- ------------------
(A) Refers to the adoption of SFAS No. 112, "Employers' Accounting for
Postemployment Benefits", effective January 1, 1994 and SFAS No. 109,
"Accounting for Income Taxes", effective January 1, 1993.
(B) Based on net income after deducting preferred stock dividends, except where
conversion is assumed, and, unless anti dilutive, the after tax dividend
equivalents on shares issuable under Citicorp's Executive Incentive
Compensation Plan.
(C) Net of unearned income.
(D) Reflects the adoption of FASB Interpretation No. 39, "Offsetting of Amounts
Related to Certain Contracts", effective January 1, 1994.
(E) Reflects the adoption of SFAS No. 115, "Accounting for Certain Investments
in Debt and Equity Securities", effective January 1, 1994.
S-6
<PAGE>
RATIOS OF INCOME TO FIXED CHARGES
For the fiscal years ended December 31, 1995, 1994, 1993, 1992 and 1991 and
the six months ended June 30, 1996, Citicorp's consolidated ratios of income to
fixed charges, computed as set forth below, were as follows:
<TABLE>
<CAPTION>
Six months Year ended December 31,
ended --------------------------------------------------------
June 30, 1996 1995 1994 1993 1992 1991
------------- ---- ---- ---- ---- ----
Income to Fixed Charges:
<S> <C> <C> <C> <C> <C> <C>
Excluding Interest on Deposits ... 2.64 2.31 1.76 1.44 1.24 0.96
Including Interest on Deposits ... 1.49 1.42 1.31 1.18 1.09 0.99
</TABLE>
Income for the year ended December 31, 1991 was inadequate to cover fixed
charges by $237 million. For purposes of computing the consolidated ratio of
income to fixed charges, income represents net income (or net loss), before
extraordinary items and cumulative effects of accounting changes, plus income
taxes and fixed charges. Fixed charges, excluding interest on deposits,
represent interest expense (except interest paid on deposits) and the interest
factor included in rents. Fixed charges, including interest on deposits,
represent all interest expense and the interest factor included in rents.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting
Agreement, Citicorp has agreed to sell to each of the Underwriters named below,
and each of the Underwriters has severally agreed to purchase, the principal
amount of the Subordinated Notes set forth opposite its name below.
Principal
Amount of
Subordinated
Underwriter Notes
----------- ------------
Citicorp Securities, Inc. .................... $ 68,000,000
Lehman Brothers Inc. ......................... 66,000,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated ............................. 66,000,000
------------
Total ............................... $200,000,000
============
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to take and pay for all of the Subordinated Notes, if
any are taken.
Citicorp has been advised by the Underwriters that the several Underwriters
propose initially to offer the Subordinated Notes in part directly to the public
at the initial public offering price set forth on the cover page of this
Prospectus Supplement and to certain securities dealers, including any
Underwriter, at such public offering price less a concession not in excess of
0.40% of the principal amount of the Subordinated Notes. The Underwriters may
allow, and such dealers may reallow, a concession not in excess of 0.25% of the
principal amount of the Subordinated Notes to certain brokers and dealers. After
the initial public offering of the Subordinated Notes, the public offering price
and other selling terms may from time to time be varied by the Underwriters.
The Subordinated Notes are a new issue of securities with no established
trading market. Citicorp has been advised by the Underwriters that they intend
to make a market in the Subordinated Notes, but are not obligated to do so and
may discontinue market making at any time without notice. No assurance can be
given as to the liquidity of the trading market for the Subordinated Notes.
Citicorp has agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
This Prospectus Supplement and Prospectus may be used by Citicorp
Securities, Inc., a wholly owned subsidiary of Citicorp, in connection with
offers and sales related to secondary market transactions in the Subordinated
Notes. Citicorp Securities, Inc. may act as principal or agent in such
transactions. Such sales will be made at prices related to prevailing market
prices at the time of sale.
S-7
<PAGE>
The participation of Citicorp Securities, Inc. in offers and sales of the
Subordinated Notes will comply with the requirements of Schedule E of the By
laws of the National Association of Securities Dealers, Inc. (the "NASD")
regarding underwriting securities of an affiliate.
Each NASD member participating in offers and sales of the Subordinated
Notes will not execute a transaction in the Subordinated Notes in a
discretionary account without the prior written specific approval of the
member's customer.
The Underwriters each engage in transactions with and perform services for
Citicorp in the ordinary course of business.
VALIDITY OF SUBORDINATED NOTES
The validity of the Subordinated Notes will be passed upon for Citicorp by
Stephen E. Dietz, Associate General Counsel of Citibank, N.A., and for the
Underwriters by Sullivan & Cromwell, New York, New York. Mr. Dietz owns or has
the right to acquire a number of shares of common stock of Citicorp equal to
less than .01% of the outstanding common stock of Citicorp.
S-8
<PAGE>
PROSPECTUS
- ----------
CITICORP [LOGO]
Senior Notes
Subordinated Notes
This Prospectus may be used in connection with the offering of Citicorp's
unsecured debt securities, which may be either senior (the "Senior Notes") or
subordinated (the "Subordinated Notes" and, together with the Senior Notes, the
"Notes"). The Notes may be offered, separately or together, in separate series
in amounts, at prices and on terms determined at the time of sale and set forth
in one or more supplements to this Prospectus (collectively, the "Prospectus
Supplement"). Pursuant to the terms of the Registration Statement of which this
Prospectus forms a part, Citicorp's preferred stock, depositary shares, common
stock and warrants may also be offered under the Registration Statement.
The Senior Notes will rank equally with all other unsecured and
unsubordinated indebtedness of Citicorp. The Subordinated Notes will be
subordinate to all existing and future Senior Indebtedness (as defined herein).
See "Description of Notes."
-----------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
-----------------------
THE NOTES OFFERED HEREBY ARE NOT DEPOSITS OR SAVINGS ACCOUNTS BUT ARE
UNSECURED DEBT OBLIGATIONS OF CITICORP AND ARE NOT INSURED BY THE
FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER
GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
-----------------------
The date of this Prospectus is August 22, 1996
<PAGE>
The specific terms of each series of Notes offered pursuant to this
Prospectus will be set forth in the applicable Prospectus Supplement, which will
identify any underwriters or agents for the Notes being offered thereby and
their compensation, and the public offering or purchase price.
With respect to each series of Notes, the related Prospectus Supplement
will set forth the aggregate principal amount offered, the rate and time of
payment of interest, if any, the authorized denominations, the maturity,
priority, premium, if any, any terms for redemption or conversion at the option
of Citicorp or the holder, the currency or composite currency, if not the U.S.
dollar, in which the Notes are denominated, and any mandatory or optional
sinking fund or analogous provisions.
The Prospectus Supplement will also contain information, where applicable,
concerning certain United States federal income tax considerations relating to,
and as to any listing on a securities exchange of, the Notes covered by such
Prospectus Supplement.
The Notes may be offered by Citicorp directly to purchasers, through agents
designated from time to time, through underwriting syndicates led by one or more
managing underwriters or through one or more underwriters acting alone. If
Citicorp, directly or through agents, solicits offers to purchase Notes,
Citicorp reserves the sole right to accept and, together with its agents, to
reject in whole or in part any proposed purchase of Notes. Affiliates of
Citicorp may from time to time act as agents or underwriters in connection with
the sale of Notes to the extent permitted by applicable law.
If any agent or underwriter is involved in the sale of Notes offered
hereby, the name of such agent or underwriter and any applicable commissions or
discounts will be set forth in, or will be calculable from, the applicable
Prospectus Supplement, and the net proceeds to Citicorp from such sale will be
the purchase price of such offered Notes less such commissions or discounts and
other attributable issuance and distribution expenses. See "Plan of
Distribution" for possible indemnification arrangements for agents, underwriters
and their controlling persons.
This Prospectus and related Prospectus Supplements may be used by direct or
indirect subsidiaries of Citicorp in connection with offers and sales related to
secondary market transactions in the Notes. Such subsidiaries may act as
principal or agent in such transactions. Such sales will be made at prices
related to prevailing market prices at the time of sale.
This Prospectus may not be used to consummate sales of Notes unless a
Prospectus Supplement is also delivered. The delivery of this Prospectus
together with a Prospectus Supplement relating to particular Notes shall not
constitute an offer in any jurisdiction of any of the other Notes covered by
this Prospectus.
FOR NORTH CAROLINA RESIDENTS: THE COMMISSIONER OF INSURANCE OF THE STATE OF
NORTH CAROLINA HAS NOT APPROVED OR DISAPPROVED THIS OFFERING NOR HAS THE
COMMISSIONER PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
2
<PAGE>
AVAILABLE INFORMATION
Citicorp is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Information, as of particular dates, concerning
directors and officers, their remuneration, options granted to them, the
principal holders of securities of Citicorp and any material interest of such
persons in transactions with Citicorp is disclosed in proxy statements
distributed to stockholders of Citicorp and filed with the Commission. Such
reports, proxy statements and other information can be inspected and copied at
the public reference facilities of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549; Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661; and Seven World Trade Center, 13th Floor, New York, New
York 10048. Copies of such material can be obtained by mail from the Public
Reference Section of the Commission at 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. Such reports, proxy statements and other information
concerning Citicorp also may be inspected at the offices of the New York Stock
Exchange, the American Stock Exchange, the Chicago Stock Exchange and the
Pacific Stock Exchange.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by Citicorp are
incorporated as of their respective filing dates in this Prospectus by
reference:
(1) Annual Report and Form 10-K for the fiscal year ended December 31,
1995, filed pursuant toSection 13 of the Exchange Act;
(2) Financial Review and Form 10-Q for the quarters ended March 31,
1996 and June 30, 1996, filed pursuant to Section 13 of the Exchange Act;
and
(3) Current Reports on Form 8-K dated January 16, 1996, April 16, 1996
and July 22, 1996, filed pursuant to Section 13 of the Exchange Act.
All reports subsequently filed by Citicorp pursuant to Sections 13(a) and
(c) of the Exchange Act, any definitive proxy or information statements filed
pursuant to Section 14 of the Exchange Act in connection with any subsequent
stockholders' meeting and any reports filed pursuant to Section 15(d) of the
Exchange Act after the date of thisProspectus and prior to the termination of
the offering of the securities offered hereby (the "Securities") shall be
incorporated by reference into this Prospectus and be a part hereof. Any
statement contained herein or in a document incorporated by reference herein
shall be modified or superseded for purposes of this Prospectus to the extent
that a statement contained herein or in any other subsequently filed document
which also is incorporated by reference herein or in the Prospectus Supplement
modifies or supersedes such statement. Any such statement so modified or
superseded shall not, except as so modified or superseded, constitute a part of
this Prospectus.
Citicorp will provide without charge to each person to whom this Prospectus
is delivered, on the request of any such person, a copy of any and all of the
foregoing documents incorporated herein by reference (other than exhibits to
such documents). Written or telephone requests should be directed to Citicorp,
399 Park Avenue, New York, New York 10043, Attention: Investor Relations
Department, (212) 559-2718.
CITICORP
Citicorp, whose principal subsidiary is Citibank, N.A. ("Citibank"), is a
holding company incorporated under the laws of the State of Delaware on December
4, 1967. The principal office of Citicorp is located at 399 Park Avenue, New
York, New York 10043; its telephone number is (212) 559-1000. Through its
subsidiaries and affiliates, including Citibank, Citicorp is a global financial
services organization serving the financial needs of individuals, businesses,
governments and financial institutions in the United States and throughout the
world.
HOLDING COMPANY
Citicorp is a legal entity separate and distinct from Citibank and its
other subsidiaries and affiliates. There are various legal limitations on the
extent to which Citicorp's bank subsidiaries may extend credit, pay dividends or
otherwise
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supply funds to Citicorp. The approval of the Office of the Comptroller of the
Currency is required if total dividends declared by a national bank in any
calendar year exceed net profits (as defined) for that year combined with its
retained net profits for the preceding two years. In addition, dividends for
such a bank may not be paid in excess of the bank's undivided profits.
State-chartered bank subsidiaries are subject to dividend limitations imposed by
applicable state law. In determining whether and to what extent to pay
dividends, each bank subsidiary must also consider the effect of dividend
payments on applicable risk-based capital and leverage ratio requirements as
well as policy statements of the federal regulatory agencies that indicate that
banking organizations should generally pay dividends out of current operating
earnings.
As of June 30, 1996, under their applicable dividend limitations,
Citicorp's national and state-chartered bank subsidiaries could have declared
dividends to their respective parent companies without regulatory approval of
approximately $4.1 billion. In determining whether and to what extent to pay
dividends, each bank subsidiary must also consider the effect of dividend
payments on applicable risk-based capital and leverage ratio requirements, as
well as policy statements of the federal regulatory agencies that indicate that
banking organizations should generally pay dividends out of current operating
earnings. Consistent with these considerations, Citicorp estimates that as of
June 30, 1996, its bank subsidiaries could have distributed dividends to
Citicorp, directly or through their parent holding company, of approximately
$3.6 billion of the available $4.1 billion.
Citicorp also derives dividends from its non-bank subsidiaries. These
subsidiaries are not subject to regulatory restrictions on their payment of
dividends to Citicorp, except that the approval of the Office of Thrift
Supervision may be required if total dividends declared by a savings association
in any calendar year exceed amounts specified in that agency's regulations. In
addition, there are numerous governmental requirements and regulations that
affect the activities of Citicorp and its bank and non-bank subsidiaries.
Under longstanding policy of The Board of Governors of the Federal Reserve
System, a bank holding company is expected to act as a source of financial
strength for its subsidiary banks and to commit resources to support such banks.
As a result of that policy, Citicorp may be required to commit resources to its
subsidiary banks in circumstances where it might not otherwise do so.
Because Citicorp is a holding company, its rights and the rights of its
creditors and stockholders, including the holders of the Securities, to
participate in the assets of any subsidiary upon the latter's liquidation or
recapitalization will be subject to the prior claims of the subsidiary's
creditors, except to the extent that Citicorp may itself be a creditor with
recognized claims against the subsidiary.
USE OF PROCEEDS
Citicorp intends to apply the net proceeds from the sale of the Securities
to its general funds to be used by its management for corporate purposes,
principally to fund investments in, or extensions of credit to, banking and
non-banking subsidiaries. Except as otherwise described in a Prospectus
Supplement, specific allocations of the proceeds to such purposes will not have
been made at the date of the applicable Prospectus Supplement, although the
management of Citicorp will have determined that funds should be raised at that
time in anticipation of future funding requirements of the subsidiaries. The
precise amount and timing of such investments in and extensions of credit to the
subsidiaries will depend upon their funding requirements and the availability of
other funds to Citicorp and itssubsidiaries.
DESCRIPTION OF NOTES
GENERAL
The Senior Notes offered hereby are to be issued under an indenture dated
as of September 1, 1989, between Citicorp and United States Trust Company of New
York, as trustee (the "Senior Trustee"), as supplemented by a first supplemental
indenture dated as of September 25, 1990 between Citicorp and the Senior Trustee
(such indenture, together with the first supplemental indenture thereto, is
referred to herein as the "Senior Indenture").
The Subordinated Notes offered hereby are to be issued under an indenture
dated as of April 1, 1991 (the "Original Subordinated Indenture"), between
Citicorp and The Chase Manhattan Bank (formerly known as Chemical
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Bank), as trustee (the "Subordinated Trustee" and, together with the Senior
Trustee, the "Trustees"), as supplemented by a first supplemental indenture
dated as of November 27, 1992 (the "First Supplemental Indenture") between
Citicorp and the Subordinated Trustee (the Original Subordinated Indenture
together with the First Supplemental Indenture is referred to herein as the
"Subordinated Indenture"). The First Supplemental Indenture was entered into in
response to an interpretation of the staff of the Board of Governors of the
Federal Reserve System concerning the capital treatment of subordinated debt and
amended the Original Subordinated Indenture by removing a restrictive covenant
relating to liens on the stock of Citibank and by narrowing the definition of
"Event of Default" to provide that the appointment of a receiver, liquidator,
assignee, trustee, sequestrator (or similar official) for Citicorp or
substantially all of its property (rather than a substantial part of its
property) is an Event of Default. These amendments do not apply to any series of
Subordinated Notes issued prior to the execution of the First Supplemental
Indenture (the "Original Subordinated Notes") and, therefore, holders of
Original Subordinated Notes could be entitled to demand immediate payment of
their securities upon the occurrence of certain events of bankruptcy or
insolvency which would not entitle the holders of Subordinated Notes offered
hereby or issued since the execution of the First Supplemental Indenture to
demand such payment.
A copy of each of the Senior Indenture and the Subordinated Indenture (each
an "Indenture" and together the "Indentures") is incorporated by reference as an
exhibit to the Registration Statement of which this Prospectus is a part. The
following summaries of certain provisions of the Indentures do not purport to be
complete and are subject to, and are qualified in their entirety by reference
to, all provisions of the applicable Indenture, including the definition therein
of certain terms.
Each Indenture provides that Notes, in addition to the Notes previously
issued under such Indenture, may be issued in separate series thereunder without
limitation as to aggregate principal amount, as authorized from time to time by,
or pursuant to resolutions of, Citicorp's Board of Directors. (Indentures
ss.301). The Notes may be issued from time to time in one or more series. The
particular terms of each series of Notes offered by a Prospectus Supplement will
be described in such Prospectus Supplement relating to such series.
The Senior Notes of each series will be unsecured and will rank pari passu
with all other unsecured and unsubordinated indebtedness of Citicorp. The
Subordinated Notes of each series will be unsecured and will rank pari passu
with all other unsecured and subordinated indebtedness of Citicorp other than
subordinated indebtedness as to which, in the instrument creating or evidencing
the same, or pursuant to which the same is outstanding, it is provided that such
indebtedness is junior to the Subordinated Notes.
Citicorp may offer under this Prospectus series of Notes under indentures
or documentation containing provisions which may differ from those included in
the Indentures or any indenture or documentation applicable to other outstanding
series of Citicorp indebtedness, provided that the material provisions of the
indenture or documentation under which such series of Notes is issued will be
described in the Prospectus Supplement relating to such seriesof Notes.
The applicable Prospectus Supplement will describe the following terms of
the Notes of each series: (1) the title of the Notes and whether they are
Subordinated Notes or Senior Notes; (2) any limit on the aggregate principal
amount of the Notes; (3) whether the Notes are to be issuable as Registered
Notes or Bearer Notes (each as defined below) or both, and whether any of the
Notes are to be issuable in temporary or permanent global form; (4) the price at
which the Notes will be issued; (5) the date on which the Notes will mature; (6)
the rate per annum at which the Notes will bear interest, if any, or the formula
pursuant to which such rate will be determined, and the date from which any such
interest will accrue; (7) the Interest Payment Dates on which any such interest
on the Notes will be payable and the Regular Record Date for any interest
payable on any Registered Notes on any Interest Payment Date; (8) the person to
whom any interest on any Registered Note of such series will be payable, if
other than the person in whose name that Note (or one or more Predecessor Notes)
is registered at the close of business on the Regular Record Date for such
interest, the manner in which, or the Person to whom, any interest on any Bearer
Note of such series will be payable, if otherwise than upon presentation and
surrender of coupons appertaining thereto, and the extent to which, or the
manner in which, any interest payable on a temporary global Note on an Interest
Payment Date will be paid if other than in the manner described under "Temporary
Global Notes" below and the extent to which, or the manner in which, any
interest payable on a permanent global Note on an Interest Payment Date will be
paid; (9) each office or agency where, subject to the terms
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of the applicable Indenture as described below under "Payment and Paying
Agents," the principal of and any premium and interest on the Notes will be
payable and each office or agency where, subject to the terms of the applicable
Indenture as described below under "Form, Exchange, Registration and Transfer,"
the Notes may be presented for registration of transfer or exchange; (10) the
period or periods within which and the price or prices at which the Notes may,
pursuant to any optional redemption provisions, be redeemed, in whole or in
part, and the other terms and provisions of any such optional redemption
provisions; (11) the obligation, if any, of Citicorp to redeem or purchase the
Notes pursuant to any sinking fund or analogous provisions or at the option of
the holder thereof and the period within which and the price at which the Notes
will be redeemed or purchased, in whole or in part, pursuant to such obligation,
and the other terms and provisions of such obligation; (12) the denominations in
which any Registered Notes will be issuable, if other than denominations of
$1,000 and any integral multiple thereof, and the denominations in which Bearer
Notes will be issuable, if other than denominations of $5,000 and integral
multiples thereof; (13) the currency or currency units of payment of principal
of and any premium and interest on the Notes, if other than U.S. dollars; (14)
any index or formula (which may be based on the value of any currencies,
commodities, securities or any group or combination thereof) used to determine
the amount of payments of principal of and any premium on the Notes; (15) if
applicable, the fact that the terms of the applicable Indenture described below
under "Defeasance and Covenant Defeasance" will not apply to such series; (16)
the application, if any, of the terms of the applicable Indenture described
below under "Assumption of Obligations" to any series of Notes issuable as
Bearer Notes; (17) any additional restrictive covenants included for the benefit
of the holders of such Notes; (18) any additional Events of Default provided
with respect to such Notes; (19) information with respect to book-entry
procedures, if any; and (20) any other terms of the Notes not inconsistent with
the provisions of the applicable Indenture. (Indentures ss.301). Any such
Prospectus Supplement will also describe any special provisions for the payment
of additional amounts with respect to the Notes of such series. If Citicorp has
an obligation to redeem or purchase the Notes at the option of the holder
thereof as provided in the applicable Prospectus Supplement pursuant to clause
(11) above, Citicorp will comply with any applicable provisions of Section 14(e)
of the Exchange Act and the related rules and regulations inconnection with such
redemption or purchase.
Notes of any series may be issued as Original Issue Discount Notes. An
Original Issue Discount Note is a Note, including any zero-coupon Note, which is
issued at a price lower than the amount payable upon the Stated Maturity thereof
and which provides that upon redemption or acceleration of the Maturity thereof
an amount less than the amount payable upon the Stated Maturity thereof and
determined in accordance with the terms of such Note shall become due and
payable. United States Holders of Original Issue Discount Notes having a
maturity of more than one year from their date of issue will have to include
original issue discount in income for federal income tax purposes as it accrues,
generally before receipt of cash attributable to such income.
To the extent described in the applicable Prospectus Supplement, Notes may
be convertible or exchangeable, at the option of the holder or Citicorp, into
common stock or other securities of Citicorp or another issuer. Any applicable
conversion or exchange provisions will be described in the Prospectus
Supplement.
Unless otherwise indicated in the applicable Prospectus Supplement, the
covenants contained in the applicable Indenture would not necessarily afford
holders of either the Senior Notes or the Subordinated Notes protection in the
event of a decline in credit quality resulting from takeovers, recapitalizations
or similar restructurings.
FORM, EXCHANGE, REGISTRATION AND TRANSFER
Notes of a series may be issued in registered form ("Registered Notes") or
bearer form ("Bearer Notes") or any combination thereof. Each Indenture also
provides that Notes of a series may be issued in temporary or permanent global
form. Unless otherwise indicated in an applicable Prospectus Supplement, Bearer
Notes (other than Bearer Notes in temporary or global form) will have interest
coupons attached. (Indentures ss.201). See "Temporary Global Notes" and
"Permanent Global Notes."
In connection with its sale during the restricted period (as defined below
under "Limitations on Issuance of Euro-Notes"), no Note issued in bearer form or
issued in global form and exchangeable for Notes in bearer form (together,
"Euro-Notes") shall be delivered to any location in the United States or its
possessions and a Euro-Note (not including a Note in temporary global form) may
be delivered in definitive form only if, prior to such delivery, the owner of
such Euro-Note or the financial institution or clearing organization through
which the owner holds such Euro-Note, directly or indirectly, provides a written
certificate to Citicorp, in the form required by the applicable Indenture, to
the effect that (a) such Euro-Note is owned by a person (other than a financial
institution for purposes of resale during the restricted period) who is not a
United States person; (b) such Euro-Note is owned by a United States
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person (other than a financial institution for purposes of resale during the
restricted period) that is (i) a foreign branch of a United States financial
institution or (ii) a United States person that acquired such Euro-Note through
the foreign branch of a United States financial institution and that for
purposes of this certification holds such Euro-Note through such financial
institution on the date of certification and, in either case, such United States
financial institution provides a certificate to Citicorp or the distributor
selling the Euro-Note stating that it agrees to comply with the requirements of
Section 165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as from
time to time amended (the "Internal Revenue Code"), and the regulations
thereunder; or (c) such Euro-Note is owned by a financial institution for
purposes of resale during the restricted period and such financial institution
certifies that it has not acquired such Euro-Note for purposes of resale
directly or indirectly to a United States person or to a person within the
United States or its possessions. Upon exchange of a portion of a temporary
global Note for an interest in a Euro-Note in permanent global form, such
certification must be given in connection with the exchange. In the case of a
Euro-Note in permanent global form, such certification must be given in
connection with the notation of a beneficial ownership interest therein upon
exchange of a portion of a temporary global Euro-Note. (Indentures ss.ss.303,
304). See "Temporary Global Notes" and "Limitations on Issuance of
Euro-Notes."
At the option of the holder, subject to the terms of the applicable
Indenture, Registered Notes of any series will be exchangeable for other
Registered Notes of the same series of any authorized denominations and of a
like aggregate principal amount and tenor. In addition, if Notes of any series
are issuable as both Registered Notes and Bearer Notes, at the option of the
holder, subject to the terms of such Indenture, Bearer Notes (with all unmatured
coupons, except as provided below, and with all matured coupons in default) of
such series will be exchangeable for Registered Notes of the same series of any
authorized denominations and of a like aggregate principal amount and tenor.
Bearer Notes surrendered in exchange for Registered Notes between a Regular
Record Date or a Special Record Date and the relevant date for payment of
interest shall be surrendered without the coupon relating to such date for
payment of interest, and interest will not be payable in respect of the
Registered Note issued in exchange for such Bearer Note, but will be payable
only to the holder of such coupon when due in accordance with the terms of the
applicable Indenture. Registered Notes, including Registered Notes received in
exchange for Bearer Notes, may not be exchanged for Bearer Notes. (Indentures
ss.305). Each Bearer Note and any coupons appertaining thereto will bear a
legend to the following effect: "Any United States person who holds this
obligation will be subject to limitations under the United States income tax
laws, including the limitations provided in Sections 165(j) and 1287(a) of the
Internal Revenue Code." (Indentures ss.201).
Notes may be presented for exchange as provided above, and Registered Notes
may be presented for registration of transfer (with the form of transfer
endorsed thereon duly executed), at the office of the Security Registrar or at
the office of any transfer agent designated by Citicorp for such purpose without
a service charge and upon payment of any taxes and other governmental charges as
described in the applicable Indenture. Such transfer or exchange will be
effected when the Security Registrar or such transfer agent, as the case may be,
is satisfied with the documents of title and identity of the person making the
request. Citicorp has appointed Citibank as Security Registrar. (Indentures
ss.305). Citicorp may at any time rescind the designation of any transfer agent
(other than the Security Registrar) or approve a change in the location through
which any such transfer agent acts, except that if Notes of a series are
issuable solely as Registered Notes, Citicorp will be required to maintain a
transfer agent in each Place of Payment for such series, and if Notes of a
series are issuable as Bearer Notes, Citicorp will be required to maintain (in
addition to the Security Registrar) a transfer agent in a Place of Payment for
such series located outside the United States and its possessions. Citicorp may
at any time designate additional transfer agents with respect to any series of
Notes.(Indentures ss.1002).
In the event of any redemption in part, Citicorp shall not be required to
(i) issue, register the transfer of or exchange any Note during a period
beginning at the opening of business 15 days before any selection for redemption
of Notes of like tenor and of the series of which such Note is a part, and
ending at the close of business on the earliest date on which the relevant
notice of redemption is deemed to have been given to all holders of Notes of
like tenor and of such series to be redeemed; (ii) register the transfer of or
exchange any Registered Note so selected for redemption, in whole or in part,
except the unredeemed portion of any Note being redeemed in part; or (iii)
exchange any Bearer Note so selected for redemption, except to exchange such
Bearer Note for a Registered Note of that series and like tenor which is
immediately surrendered for redemption. (Indentures ss.305).
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PAYMENT AND PAYING AGENTS
Unless otherwise indicated in the applicable Prospectus Supplement and
provided that the certificate described above under "Form, Exchange,
Registration and Transfer" has been received, principal of and any premium and
interest on Bearer Notes will be payable, subject to any applicable laws and
regulations, at the offices of such Paying Agents outside the United States and
its possessions as Citicorp may designate from time to time, at the option of
the holder, by check or by transfer to an account maintained by the payee with a
financial institution located outside the United States and its possessions.
Unless otherwise indicated in the applicable Prospectus Supplement, payment of
interest on a Bearer Note on any Interest Payment Date will be made only against
surrender to the Paying Agent of the coupon relating to such Interest Payment
Date. (Indentures ss.1001). No payment with respect to any Bearer Note will be
made at any office or agency of Citicorp in the United States or its possessions
or by check mailed to any address in the United States or its possessions or by
transfer to any account maintained with a financial institution located in the
United States or its possessions. Notwithstanding the foregoing, payments of
principal of and any premium and interest on Bearer Notes denominated and
payable in U.S. dollars will be made at the office of the Paying Agent in the
Borough of Manhattan, The City of New York, if (but only if) payment of the full
amount thereof in U.S. dollars at all offices or agencies outside the United
States and its possessions is illegal or effectively precluded by
exchange controls or other similar restrictions. (Indentures ss.1002).
Unless otherwise indicated in an applicable Prospectus Supplement,
principal of and any premium and interest on Registered Notes will be payable,
subject to any applicable laws and regulations, at the office of such Paying
Agent or Paying Agents as Citicorp may designate from time to time, except that
at the option of Citicorp payment of any interest may be made by check mailed to
the address of the Person entitled thereto as such address shall appear in the
Security Register. (Indentures ss.201). Unless otherwise indicated in an
applicable Prospectus Supplement, payment of interest on a Registered Note on
any Interest Payment Date will be made to the Person in whose name such
Registered Note (or Predecessor Note) is registered at the close of business on
the Regular Record Date for such interest. (Indentures ss.307).
Unless otherwise indicated in the applicable Prospectus Supplement, the
Corporate Trust Office of Citibank in The City of New York will be designated as
a Paying Agent for Citicorp for payments with respect to Notes of each series
which are issuable solely as Registered Notes and as a Paying Agent for payments
with respect to Notes of each series (subject to the limitations described above
in the case of Bearer Notes) which are issuable solely as Bearer Notes or as
both Registered Notes and Bearer Notes. Any Paying Agents outside the United
States and its possessions and any other Paying Agents in the United States or
its possessions initially designated by Citicorp for the Notes of each series
will be named in the applicable Prospectus Supplement. Citicorp may at any time
designate additional Paying Agents or rescind the designation of any Paying
Agent or approve a change in the office through which any Paying Agent acts,
except that if Notes of a series are issuable solely as Registered Notes,
Citicorp will be required to maintain a Paying Agent in each Place of Payment
for such series and, if Notes of a series are issuable as Bearer Notes, Citicorp
will be required to maintain (i) a Paying Agent in the Borough of Manhattan, The
City of New York for payments with respect to any Registered Notes of the series
(and for payments with respect to Bearer Notes of the series in the
circumstances described above, but not otherwise) and (ii) a Paying Agent in a
Place of Payment located outside the United States and its possessions where
Notes of such series and any coupons appertaining thereto may be presented and
surrendered for payment; provided, however, that if the Notes of such series are
listed on The International Stock Exchange of the United Kingdom and the
Republic of Ireland Limited (the "London Stock Exchange"), the Luxembourg Stock
Exchange or any other stock exchange located outside the United States and its
possessions and such stock exchange shall so require, Citicorp will maintain a
Paying Agent in London, Luxembourg or any other required city located outside
the United States and its possessions for the Notes of such series. (Indentures
ss.1002).
After notice by publication, all moneys paid by Citicorp to a Paying Agent
for the payment of the principal of and any premium or interest on any Note of
any series which remain unclaimed at the end of two years after such principal,
premium or interest shall have become due and payable will be repaid to
Citicorp, and the holder of such Note or any coupon appertaining thereto may
thereafter look only to Citicorp for payment thereof. (Indentures ss.1003).
TEMPORARY GLOBAL NOTES
All Euro-Notes will initially be represented by one or more temporary
global Notes, without interest coupons, to be deposited with a common depositary
in London for Morgan Guaranty Trust Company of New York, Brussels
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office, in its capacity as operator of the Euroclear System ("Euroclear") and
Cedel Bank, societe anonyme ("Cedel") for credit to the designated accounts. On
and after the date determined as provided in any such temporary global Note and
described in an applicable Prospectus Supplement (the "Exchange Date"), each
such temporary global Note will be exchanged for definitive Bearer Notes,
definitive Registered Notes or all or a portion of a permanent global Note, or
any combination thereof, as specified in an applicable Prospectus Supplement,
but, unless otherwise specified in an applicable Prospectus Supplement, only
upon receipt by Euroclear or Cedel of written certification in the form and to
the effect described above under "Form, Exchange, Registration and Transfer." No
Note delivered in exchange for any portion of a temporary global Note shall be
delivered to any location in the United States or its possessions in connection
with such exchange. (Indentures ss.304).
Unless otherwise specified in an applicable Prospectus Supplement, interest
in respect of any portion of a temporary global Note payable in respect of an
Interest Payment Date occurring prior to the issuance of definitive Notes
(including a permanent global Note) will be payable to the bearer and thus,
while such temporary global Note is deposited with the common depositary for
Euroclear and Cedel, will be paid to each of Euroclear and Cedel with respect to
the portion of the temporary global Note held for its account for which it
provides certification in the form described above under "Form, Exchange,
Registration and Transfer." If an Interest Payment Date occurs prior to the
issuance of definitive Notes (including a permanent global Note), written
certification in the form and to the effect described above under "Form,
Exchange, Registration and Transfer" will be required to obtain an interest
payment, and upon receipt of such certification Euroclear or Cedel, as the case
may be, will exchange the portion of the temporary global Note relating to such
certification for an interest in a permanent global Note (unless the account
holder requests that such portion be exchanged for a definitive Registered Note
or Notes or a definitive Bearer Note or Notes). (Indentures ss.304).
PERMANENT GLOBAL NOTES
If any Notes of a series are issuable in permanent global form, the
applicable Prospectus Supplement will describe the circumstances, if any, under
which beneficial owners of interests in any such permanent global Note may
exchange such interests for Notes of such series and of like tenor and principal
amount in any authorized form and denomination. No Bearer Note delivered in
exchange for any portion of a permanent global Note shall be delivered to any
location in the United States or its possessions in connection with such
exchange. (Indentures ss.305). Principal of and any premium and interest on any
permanent global Note will be payable in the manner described in the applicable
Prospectus Supplement. (Indentures ss.304).
LIMITATIONS ON LIENS ON STOCK OF CITIBANK
Citicorp has covenanted in the Senior Indenture that, so long as any of the
Senior Notes issued thereunder which mature more than ten years after their
issuance are Outstanding, it will not create, incur, assume or suffer to exist
any mortgage, pledge, security interest or other encumbrance, as security for
indebtedness for borrowed money, upon any shares of Voting Stock of Citibank
owned by Citicorp, without effectively providing that the Senior Notes issued
under such Indenture which mature more than ten years after their issuance shall
be secured equally and ratably with, or prior to, such indebtedness; provided,
however, that Citicorp shall be permitted to create, incur, assume or suffer to
exist any such mortgage, pledge, security interest or other encumbrance without
regard to the foregoing provisions so long as after giving effect thereto
Citicorp will own at least 80% of the Voting Stock of Citibank then issued and
outstanding, free and clear of any such mortgage, pledge, security interest or
other encumbrance. For the purpose of this covenant, the term "Voting Stock" of
Citibank shall mean stock of any class or classes, however designated, having
ordinary voting power for the election of a majority of the board of directors
of Citibank, other than stock having such power only by reason of the happening
of a contingency. (Senior Indenture ss.1005). The foregoing covenant also
applies to the Original Subordinated Notes but is not a provision of the
Subordinated Indenture and does not apply to any series of Subordinated Notes.
DEFAULTS; EVENTS OF DEFAULT
Unless otherwise provided in the applicable Prospectus Supplement, the
following will be "Events of Default" under the Senior Indenture with respect to
any series of Senior Notes: (a) failure to pay principal of or any premium on
any Senior Note of that series at maturity; (b) failure to pay any interest on
any Senior Note of that series when due,
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continued for 30 days; (c) failure to deposit any sinking fund payment, when
due, in respect of any Senior Note of that series; (d) failure to perform any
other covenant of Citicorp in the Senior Indenture (other than a covenant
included in the Senior Indenture solely for the benefit of series of Senior
Notes other than that series) continued for 60 days after written notice of such
default; (e) certain events of bankruptcy, insolvency or reorganization of
Citicorp or Citibank; and (f) any other Event of Default provided with respect
to Senior Notes of that series. (Senior Indenture ss.501).
Unless otherwise provided in the applicable Prospectus Supplement, the
following will be "Defaults" under the Subordinated Indenture with respect to
any series of Subordinated Notes: (a) failure to pay principal of or any premium
on any of the Subordinated Notes of that series at maturity; (b) failure to pay
any interest on any Subordinated Note of that series when due, continued for 30
days; (c) failure to perform any other covenant of Citicorp in the Subordinated
Indenture (other than a covenant included in the Subordinated Indenture solely
for the benefit of series of Subordinated Notes other than that series)
continued for 60 days after written notice of such default; (d) any Event of
Default; and (e) any other Default provided with respect to Subordinated Notes
of that series. (Subordinated Indenture ss.503). Unless otherwise provided in
the applicable Prospectus Supplement, the following will be the Events of
Default under the Subordinated Indenture with respect to any series of
Subordinated Notes: (x) certain events of bankruptcy, insolvency or
reorganization of Citicorp; and (y) any other Event of Default provided with
respect to Subordinated Notes of that series. (Subordinated Indenture ss.501).
Unless an Event of Default has occurred and shall be continuing with respect to
a series of Subordinated Notes, neither the holders of such Subordinated Notes
nor the Subordinated Trustee may declare the acceleration of the payment of
principal or premium, if any, of such Subordinated Notes under the Subordinated
Indenture.
Subject to the provisions of the applicable Indenture relating to the
duties of the related Trustee, in case an Event of Default with respect to
either the Senior Notes or the Subordinated Notes shall occur, or in case a
Default with respect to the Subordinated Notes shall occur and be continuing,
such Trustee will be under no obligation to exercise any of its rights or powers
under such Indenture at the request or direction of any of the holders of Notes
of any series or any related coupons unless such holders shall have offered to
such Trustee reasonable indemnity. (Indentures ss.ss.601, 603). The holders of a
majority in aggregate principal amount of the Outstanding Notes of any series
will have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the related Trustee, or exercising any
trust or power conferred on the Trustee, with respect to Notes of that series,
provided that such direction does not conflict with applicable law or the
applicable Indenture or have a substantial likelihood of involving such Trustee
in personal liability. (Indentures ss.512).
If an Event of Default with respect to Notes of any series at the time
Outstanding shall occur and be continuing, either the related Trustee or the
holders of at least 25% in aggregate principal amount of the Outstanding Notes
of that series may declare the principal, or, if any such Notes are Original
Issue Discount Notes, such lesser amounts as may be described in the applicable
Prospectus Supplement, of all such Outstanding Notes of that series to be due
and payable immediately. At any time after a declaration of acceleration with
respect to Notes of any series has been made but before a judgment or decree for
payment of money due has been obtained by such Trustee, the holders of a
majority in aggregate principal amount of Outstanding Notes of that series may
rescind any declaration of acceleration and its consequences, if all payments
due (other than those due as a result of acceleration) have been made and all
Events of Default have been remedied or waived. (Indentures ss.502).
No holder of any Notes of any series or any related coupons will have any
right to institute any proceeding with respect to the applicable Indenture or
for any remedy thereunder, unless such holder shall have previously given to the
related Trustee written notice of a continuing Event of Default, with respect to
the Senior Notes or the Subordinated Notes of that series, or of a continuing
Default with respect to the Subordinated Notes of that series, the holders of at
least 25% in aggregate principal amount of the Outstanding Notes of that series
shall have made written request, and offered reasonable indemnity, to the
Trustee to institute such proceeding as Trustee, and the Trustee shall not have
received from the holders of a majority in aggregate principal amount of the
Outstanding Notes of that series a direction inconsistent with such request and
shall have failed to institute such proceeding within 60 days. (Indentures
ss.507). However, such limitations do not apply to a suit instituted by a holder
of an Outstanding Note of that series for enforcement of payment of the
principal of, or any premium or interest on, such Note on or after the
respective due dates expressed in such Note. (Indentures ss.508).
Citicorp is required to furnish annually to each Trustee a statement as to
its performance or fulfillment of covenants, agreements or conditions in the
applicable Indenture and as to the absence of defaults thereunder.(Indentures
ss.1004).
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MEETINGS, MODIFICATION AND WAIVER
Modifications and amendments of each Indenture may be made by Citicorp and
the related Trustee with the consent of the holders of not less than a majority
in aggregate principal amount of the Outstanding Notes of each series affected
by such modification or amendment; provided, however, that no such modification
or amendment may, without the consent of the holders of each Outstanding Note
affected thereby, (a) change the Stated Maturity of the principal of, or any
installment of principal of or interest on, any Note, (b) reduce the principal
amount of, or premium or interest on, any Note, (c) change any obligation of
Citicorp to pay additional amounts, (d) reduce the amount of principal of an
Original Issue Discount Note payable upon acceleration of the Maturity thereof,
(e) change the coin or currency in which any Note or any premium or interest
thereon is payable, (f) impair the right to institute suit for the enforcement
of any payment on or with respect to any Note, (g) reduce the percentage in
principal amount of Outstanding Notes of any series, the consent of whose
holders is required for modification or amendment of the applicable Indenture or
for waiver of compliance with certain provisions of such Indenture or for waiver
of certain defaults, (h) reduce the requirements contained in such Indenture for
quorum or voting, (i) change any obligation of Citicorp to maintain an office or
agency in the places and for the purposes required by such Indenture, or (j)
modify any of the above provisions. (Indentures ss.902). Under certain limited
circumstances, modifications and amendments of such Indenture may be made by
Citicorp and the related Trustee without the consent of any holders of
Outstanding Notes. (Indentures ss.901).
The holders of at least a majority in aggregate principal amount of the
Outstanding Notes of a series may, on behalf of the holders of all the Notes of
that series, waive, insofar as that series is concerned, compliance by Citicorp
with certain restrictive provisions of the applicable Indenture. (Indentures
ss.1007). The holders of not less than a majority in aggregate principal amount
of the Outstanding Notes of a series may, on behalf of all holders of Notes of
that series and any coupons appertaining thereto, waive any past default under
the applicable Indenture with respect to Notes of that series, except a default
(a) in the payment of principal of or any premium or interest on any Note of
such series or (b) in respect of a covenant or provision of the applicable
Indenture which cannot be modified or amended without the consent of the holders
of each Outstanding Note of such series affected. (Indentures ss.513).
Each Indenture provides that in determining whether the holders of the
requisite principal amount of the Outstanding Notes have given any request,
demand, authorization, direction, notice, consent or waiver thereunder or are
present at a meeting of holders of Notes for quorum purposes, (i) the principal
amount of an Original Issue Discount Note that shall be deemed to be Outstanding
shall be the amount of the principal thereof that would be due and payable as of
the date of such determination upon acceleration of the Maturity thereof, and
(ii) the principal amount of a Note denominated in a foreign currency or
currency unit shall be the U.S. dollar equivalent, determined on the date of
original issuance of such Note, of the principal amount of such Note or, in the
case of an Original Issue Discount Note, the U.S. dollar equivalent, determined
on the date of original issuance of such Note, of the amount determined
asprovided in (i) above. (Indentures ss.101).
Each Indenture contains provisions for convening meetings of the holders of
Notes of a series if Notes of that series are issuable as Bearer Notes.
(Indentures ss.1301). A meeting may be called at any time by the Trustee, and
also, upon request, by Citicorp or the holders of at least 10% in aggregate
principal amount of the Outstanding Notes of such series, in any such case upon
notice given in accordance with "Notices" below. (Indentures ss.1302). Except
for any consent which must be given by the holder of each Outstanding Note
affected thereby, as described above, any resolution presented at a meeting or
adjourned meeting at which a quorum is present may be adopted by the affirmative
vote of the holders of a majority in aggregate principal amount of the
Outstanding Notes of that series; provided, however, that, except for any
consent which must be given by the holder of each Outstanding Note affected
thereby, as described above, any resolution with respect to any consent, waiver,
request, demand, notice, authorization, direction or other action which may be
given by the holders of not less than a specified percentage in aggregate
principal amount of Outstanding Notes of a series may be adopted at a meeting or
an adjourned meeting at which a quorum is present only by the affirmative vote
of the holders of not less than such specified percentage in aggregate principal
amount of the Outstanding Notes of that series. Any resolution passed or
decision taken at any meeting of holders of Notes of any series duly held in
accordance with the applicable Indenture will be binding on all holders of Notes
of that series and the related coupons. The quorum at any meeting called to
adopt a resolution, and at any adjourned meeting, will be Persons holding or
representing a majority in aggregate principal amount of the Outstanding Notes
of a series; provided, however, that if any action is to be taken at such
meeting with respect to a consent, waiver, request,
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demand, notice, authorization, direction or other action which may be given by
the holders of not less than a specified percentage in aggregate principal
amount of the Outstanding Notes of a series, the Persons holding or representing
such specified percentage in aggregate principal amount of the Outstanding Notes
of such series will constitute aquorum. (Indentures ss.1304).
CONSOLIDATION, MERGER AND SALE OF ASSETS
Citicorp may, without the consent of the holders of any of the Outstanding
Notes of a series, consolidate with, merge into or transfer its assets
substantially as an entirety to any corporation organized under the laws of any
domestic or foreign jurisdiction, provided that (i) the successor corporation
assumes Citicorp's obligations on the Notes of each series and under the
applicable Indenture, (ii) after giving effect thereto, with respect to the
Senior Notes, no Event of Default and no event which, after notice or lapse of
time, or both, would become an Event of Default shall have occurred and be
continuing, (iii) after giving effect thereto, with respect to the Subordinated
Notes, no Default, and no event which, after notice or lapse of time, or both,
would become a Default, shall have happened and becontinuing, and (iv) certain
other conditions are met. (Indentures ss.ss.801, 802).
ASSUMPTION OF OBLIGATIONS
If so specified in an applicable Prospectus Supplement for a series of
Notes issuable as Bearer Notes, Citicorp may elect at any time to assign to a
Subsidiary or an Affiliate of Citicorp, and cause such Subsidiary or Affiliate
to assume, the obligations of Citicorp for the due and punctual payment of the
principal of and any premium and interest on all the Notes of such series and
the performance of every covenant of the applicable Indenture, except as
described below, on the part of Citicorp to be performed or observed with
respect to the Notes of such series, provided that(i) Citicorp has the right to
redeem the Notes of such series in the event of certain changes involving United
States taxes or the imposition of certain reporting requirements as expressly
described in the applicable Prospectus Supplement and the circumstances and
conditions expressly described in such Prospectus Supplement giving rise to
Citicorp's right so to redeem the Notes of such series have occurred, are in
effect and have been satisfied, as the case may be, (ii) no payment of principal
of or any premium or interest on any of the Notes of such series is
overdue, (iii) Citicorp unconditionally guarantees the performance of the
obligations of such Subsidiary or Affiliate under the applicable Indenture and
under the Notes of such series, (iv) Citicorp and such Subsidiary or Affiliate
each agrees to indemnify the holder of each Note of such series against (A) any
tax, assessment or governmental charge which is imposed on such holder by a
jurisdiction other than the United States or any political subdivision or taxing
authority thereof or therein with respect to, and which is withheld on the
making of, the payment of the principal of or any premium or interest on such
Note, and which would not have been so imposed and withheld had such assignment
and assumption not been made, (B) any tax, assessment or governmental charge
imposed on or relating to the act of assignment and assumption and (C) any costs
or expenses of the act of assignment and assumption, (v) after giving effect
thereto, no Event of Default with respect to the Senior Notes or the
Subordinated Notes and no Default with respect to the Subordinated Notes, and no
event which, after notice or lapse of time, or both, would become an Event of
Default or Default, respectively, shall have occurred and be continuing, and
(vi) certain other conditions are met. (Indentures ss.803). Notwithstanding any
assignment and assumption with respect to the Notes of a series as described in
this paragraph, Citicorp will remain unconditionally obligated to comply with
such provisions of each Indenture as may be required to comply with applicable
law and, with respect to the Senior Notes and the Original Subordinated Notes,
Citicorp shall remain unconditionally obligated to comply with the covenant
described above under"Limitations on Liens on Stock of Citibank." (Indentures
ss.ss.803, 804).
NOTICES
Except as otherwise provided in the applicable Indenture, notices to
holders of Bearer Notes will be given by publication at least twice in a daily
newspaper of general circulation in The City of New York and in such other city
or cities as may be specified in such Notes. Notices to holders of Registered
Notes will be given by mail to the addresses of such holders as they appear in
the Security Register. (Indentures ss.ss.101, 106).
TITLE
Title to any Bearer Notes (including Bearer Notes in temporary global form
and in permanent global form) and any coupons appertaining thereto will pass by
delivery. Citicorp, the related Trustee and any agent of Citicorp or such
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Trustee may treat the bearer of any Bearer Note and the bearer of any coupon and
the registered owner of any Registered Note as the absolute owner thereof
(whether or not such Note or coupon shall be overdue and notwithstanding any
notice to the contrary) for the purpose of making payment and for all other
purposes. (Indentures ss.308).
REPLACEMENT OF NOTES AND COUPONS
Any mutilated Note or a Note with a mutilated coupon appertaining thereto
will be replaced by Citicorp at the expense of the holder upon surrender of such
Note to the related Trustee. Notes or coupons that become destroyed, lost or
stolen will be replaced by Citicorp at the expense of the holder upon delivery
to such Trustee of evidence of the destruction, loss or theft thereof
satisfactory to Citicorp and such Trustee; in the case of any coupon which
becomes destroyed, lost or stolen, such coupon will be replaced by issuance of a
new Note in exchange for the Note to which such coupon appertains. In the case
of a destroyed, lost or stolen Note or coupon, an indemnity satisfactory to such
Trustee and Citicorp may be required at the expense of the holder of such Note
or coupon before a replacement Note will be issued. (Indentures ss.306).
DEFEASANCE AND COVENANT DEFEASANCE
Unless otherwise specified in the applicable Prospectus Supplement for a
series of Notes, Citicorp may cause itself (i) to be discharged from any and all
obligations with respect to such Notes (subject to the terms of the applicable
Indenture) ("defeasance") and/or (ii) to be released from its obligations
described above under "Limitations on Liens on Stock of Citibank" with respect
to the Senior Notes or Original Subordinated Notes ("covenant defeasance"), upon
the deposit with the related Trustee (or other qualifying trustee), in trust for
such purpose, of money and/or U.S. Government Obligations which through the
payment of principal and interest in accordance with their terms will provide
money in an amount sufficient, without reinvestment, to pay the principal of and
any premium or interest on such Notes to Maturity or redemption, as the case may
be, and any mandatory sinking fund or analogous payments thereon. As a condition
to defeasance or covenant defeasance, Citicorp must deliver to the related
Trustee an Opinion of Counsel to the effect that the holders of such Notes will
not recognize income, gain or loss for United States federal income tax purposes
as a result of such defeasance or covenant defeasance and will be subject to
United States federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such defeasance or covenant
defeasance had not occurred. Such Opinion, in the case of defeasance under
clause (i) above, must refer to and be based upon a published ruling of the
Internal Revenue Service or changes in applicable United States federal income
tax law occurring after the date of the applicable Indenture. (Indentures
Article Fourteen).
Defeasance by Citicorp with respect to the Notes of a series is permitted
notwithstanding Citicorp's prior covenant defeasance with respect to such
series. Following a defeasance, payment of such Notes may not be accelerated
because of an Event of Default or a Default. (Indentures ss.1402). Following a
covenant defeasance, payment of Senior Notes or the Original Subordinated Notes
may not be accelerated by reference to the covenant noted under clause(ii)
above. (Senior Indenture ss.1403, Original Subordinated Indenture ss.1403).
However, if such an acceleration were to occur, the realizable value at the
acceleration date of the money and U.S. Government Obligations in the defeasance
trust could be less than the principal and interest then due on such Notes, in
that the required deposit in the defeasance trust is based upon scheduled cash
flows rather than market value, which will vary depending upon interest rates
and other factors.
SUBORDINATION
The Subordinated Notes will be subordinate and junior in right of payment,
to the extent set forth in the Subordinated Indenture, to all Senior
Indebtedness (as defined below) of Citicorp. In the event that Citicorp shall
default in the payment of any principal of (or premium, if any) or interest on
any Senior Indebtedness when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise, then,
unless and until such default shall have been cured or waived or shall have
ceased to exist, no direct or indirect payment (in cash, property, securities,
by set-off or otherwise) shall be made or agreed to be made on account of the
principal of or interest on the indebtedness evidenced by the Subordinated
Notes, or in respect of any redemption, retirement, purchase or other
acquisition of any of the Subordinated Notes. In the event of (a) any
insolvency, bankruptcy, receivership, liquidation, reorganization, readjustment,
composition or other similar proceeding relating to Citicorp, its creditors or
its
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property, (b) any proceeding for the liquidation, dissolution or other
winding-up of Citicorp, voluntary or involuntary, whether or not involving
insolvency or bankruptcy proceedings, (c) any assignment by Citicorp for the
benefit of creditors or (d) any other marshaling of the assets of Citicorp, all
Senior Indebtedness (including any interest thereon accruing after the
commencement of any such proceedings) shall first be paid in full before any
payment or distribution under the Subordinated Notes, whether in cash,
securities or other property, shall be made to any Subordinated Note holders. In
such event, any payment or distribution under the Subordinated Notes, whether in
cash, securities or other property (other than securities of Citicorp or any
other corporation provided for by a plan of reorganization or readjustment the
payment of which is subordinate at least to the extent provided in the
subordination provisions with respect to the Subordinated Notes to the payment
of all Senior Indebtedness at the time outstanding, and to any securities issued
in respect thereof under any such plan of reorganization or readjustment), which
would otherwise (but for those subordination provisions) be payable or
deliverable in respect of the Subordinated Notes, shall be paid or delivered
directly to the holders of Senior Indebtedness in accordance with the priorities
then existing among such holders until all Senior Indebtedness (including any
interest thereon accruing after the commencement of any such proceedings) shall
have been paid in full. If any payment or distribution under the Subordinated
Notes, of any character whether in cash, securities or other property (other
than securities of Citicorp or any other corporation provided for by a plan of
reorganization or readjustment the payment of which is subordinate, at least to
the extent provided in the subordination provisions with respect to the
Subordinated Notes, to the payment of all Senior Indebtedness at the time
outstanding and to any securities issued in respect thereof under any such plan
of reorganization or readjustment), shall be received by any holder of any
Subordinated Notes in contravention of any of the terms hereof and before all
the Senior Indebtedness shall have been paid in full, such payment or
distribution or security shall be received in trust for the benefit of, and
shall be paid over or delivered and transferred, to the holders of the Senior
Indebtedness at the time outstanding in accordance with the priorities then
existing among such holders for application to the paymentof all Senior
Indebtedness remaining unpaid to the extent necessary to pay all such Senior
Indebtedness in full(Subordinated Indenture ss.1501).
"Senior Indebtedness" means any obligation of Citicorp to its creditors,
whether outstanding or subsequently incurred, other than (a) all subordinated
securities and subordinated capital notes issued or which may be issued under
certain specified indentures; (b) all guarantees of indebtedness of subsidiaries
of Citicorp that may be issued under certain specified subordinated indentures
of those subsidiaries; (c) any obligation as to which, in the instrument
creating or evidencing the same or pursuant to which the same is outstanding, it
is provided that such obligation is not Senior Indebtedness (including, without
limitation, all other unsecured and subordinated indebtedness of Citicorp); and
(d) any securities issued under the Original Subordinated Indenture or the
Subordinated Indenture, including Subordinated Notes. (Subordinated Indenture
ss.101). Neither Indenture limits the issuance of additional Senior
Indebtedness.
Because Citicorp is a holding company, its rights and the rights of its
creditors, including the holders of the Notes, to participate in the assets of
any subsidiary upon the latter's liquidation or recapitalization will be subject
to the prior claims of the subsidiary's creditors, except to the extent that
Citicorp may itself be a creditor with recognized claims against the subsidiary.
GOVERNING LAW
Each Indenture, the Notes and the coupons will be governed by, and
construed in accordance with, the laws of the State of New York. (Indentures
ss.113).
CONCERNING THE TRUSTEES
United States Trust Company of New York, the Senior Trustee, has its
principal corporate trust office at 114 West 47th Street, New York, New York
10036 and is also trustee under other Citicorp indentures under which unsecured
debt securities are currently outstanding.
The Chase Manhattan Bank (formerly known as Chemical Bank), the
Subordinated Trustee, has its principal corporate trust office at 450 West 33rd
Street, New York, New York 10001, and is also trustee under other indentures
under which subordinated unsecured debt securities issued or guaranteed by
Citicorp are currently outstanding.
Citicorp or its affiliates maintain certain accounts and other banking
relationships with the Trustees and their respective affiliates.
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LIMITATIONS ON ISSUANCE OF EURO-NOTES
In compliance with United States federal tax laws and regulations,
Euro-Notes may not be offered or sold during the restricted period (as defined
below) in the United States or its possessions or to a United States person
(each as defined below) other than an exempt purchaser (as defined below).
Furthermore, in compliance with such federal tax laws and regulations,
Euro-Notes may not be delivered, in connection with the sale thereof during the
restricted period, in definitive form within the United States or its
possessions.
Citicorp will not offer or sell Euro-Notes during the restricted period to
a person who is within the United States or its possessions or to a United
States person other than an exempt purchaser, and any underwriter, agent and
dealer participating in the offering of Euro-Notes must covenant that: (i) it
has not and will not offer or sell the Euro-Notes during the restricted period
to a person who is within the United States or its possessions or to a United
States person other than an exempt purchaser; (ii) it has in effect, in
connection with the offer and sale of the Euro-Notes during the restricted
period, procedures reasonably designed to ensure that its employees or agents
who are directly engaged in selling the Euro-Notes are aware that the Euro-Notes
cannot be offered or sold during the restricted period to a person who is within
the United States or its possessions or who is a United States person (other
than an exempt purchaser); (iii) it will not permit any affiliate (within the
meaning of Section 1.163-5(c)(2)(i)(D)(4)(iii) of the regulations issued under
the Internal Revenue Code (the "Treasury Regulations")) to acquire any Euro-Note
for the purpose of offering or selling it during the restricted period unless
such affiliate provides it (for the benefit of Citicorp) with the covenants
contained in this paragraph; (iv) it will not deliver any Euro-Notes, in
connection with the sale thereof during the restricted period, in definitive
form within the United States or its possessions; (v) it will not enter into any
written contract with another distributor (within the meaning of Section
1.163-5(c)(2)(i)(D)(4) of the Treasury Regulations) to offer or sell the
Euro-Notes during the restricted period unless such distributor provides it (for
the benefit of Citicorp) with the covenants contained in this paragraph; and
(vi) if it is a United States person, it is acquiring the Euro-Notes for
purposes of resale in connection with their original issuance and if it retains
the Euro-Notes for its own account, it will only do so in accordance with the
requirements of Section 1.163-5(c)(2)(i)(D)(6) of the Treasury Regulations.
For purposes of the selling restrictions described in this section, an
offer or sale will be considered to be made to a person who is within the United
States or its possessions if the offeror or seller of the Euro-Notes has an
address within the United States or its possessions for the offeree or buyer of
the Euro-Notes with respect to the offer or sale. Bearer Notes and any coupons
appertaining thereto (including Euro-Notes in permanent global form exchangeable
for Bearer Notes) will bear a legend to the following effect: "Any United States
person who holds this obligation will be subject to limitations under the United
States income tax laws, including the limitations provided in Sections 165(j)
and 1287(a) of the Internal Revenue Code."
As used herein, "United States person" means a citizen or resident of the
United States, a corporation, partnership or other entity created or organized
in or under the laws of the United States and an estate or trust the income of
which is subject to United States federal income taxation regardless of its
source, "United States" means the United States of America (including the States
and the District of Columbia) and "possessions" of the United States include
Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and
Northern Mariana Islands, "restricted period" means with respect to a Note, the
period beginning on the earlier of the closing date or the first date on which
the Note is offered to persons other than distributors and ending on the
expiration of the 40-day period beginning on such date, except that,
notwithstanding the foregoing, any offer or sale of the Notes by Citicorp or a
distributor shall be deemed to be made during the restricted period if Citicorp
or the distributor holds the Note as part of an unsold allotment or
subscription, and "exempt purchaser" means (A) an exempt distributor (as defined
in Section 1.163-5(c)(2)(i)(D)(5) of the Treasury Regulations) that covenants
that it is buying the Euro-Notes for the purpose of resale in connection with
the original issuance thereof, and that if it retains the Euro-Notes for its own
account, it will do so only in accordance with the requirements of Section
1.163-5(c)(2)(i)(D)(6) of the Treasury Regulations; (B) an international
organization described in Section 7701(a)(18) of the Internal Revenue Code; (C)
a foreign central bank (as defined in Section 895 of the Internal Revenue Code
and the Treasury Regulations thereunder); (D) a foreign branch of a United
States financial institution as described in Section 1.163-5(c)(2)(i)(D)(6)(i)
of the Treasury Regulations; and (E) a United States person who acquires the
Euro-Notes through the foreign branch of a United States financial institution
and who holds the Euro-Notes through such financial institution. Notwithstanding
the foregoing, however, (i) a person described in (A) of this paragraph will not
be considered an exempt purchaser with respect to
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offers to a non-United States office of such person; (ii) a person described in
(B) or (C) of this paragraph will not be considered an international
organization or a foreign central bank, as the case may be, with respect to
offers that are not made directly and specifically to such person; (iii) a
person described in (E) of this paragraph will be considered an exempt purchaser
only with respect to sales of the Euro-Notes; and (iv) a person described in (D)
or (E) of this paragraph will not be considered an exempt purchaser unless the
financial institution holding the Euro-Note provides a certificate to Citicorp
or the distributor selling the Euro-Note stating that it agrees to comply with
the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue
Code and the Treasury Regulations thereunder.
FOREIGN CURRENCY RISKS
GENERAL
Notes may be denominated in such foreign currencies or currency units as
may be designated by Citicorp at the time of offering (the "Foreign Currency
Securities").
PROSPECTIVE PURCHASERS SHOULD CONSULT THEIR OWN FINANCIAL AND LEGAL
ADVISORS AS TO THE RISKS ENTAILED BY AN INVESTMENT IN FOREIGN
CURRENCY SECURITIES. FOREIGN CURRENCY SECURITIES ARE NOT AN APPROPRIATE
INVESTMENT FOR INVESTORS WHO ARE UNSOPHISTICATED WITH RESPECT TO FOREIGN
CURRENCY TRANSACTIONS.
The information set forth below is directed to prospective purchasers of
Foreign Currency Securities who are United States residents, and Citicorp
disclaims any responsibility to advise prospective purchasers who are residents
of countries other than the United States with respect to any matters that may
affect the purchase or holding ofa Foreign Currency Security or the receipt of
payments of principal of and any premium and interest on a Foreign Currency
Security. Such persons should consult their own legal advisors with regard to
such matters.
EXCHANGE RATES AND EXCHANGE CONTROLS
An investment in Foreign Currency Securities entails significant risks that
are not associated with a similar investment in a security denominated in U.S.
dollars. Such risks include, without limitation, the possibility of significant
changes in the rate of exchange between the U.S. dollar and the relevant foreign
currency and the possibility of the imposition or modification of foreign
exchange controls by either the United States or foreign governments. Such risks
generally depend on economic and political events over which Citicorp has no
control. In recent years, rates of exchange between the U.S. dollar and certain
foreign currencies have been highly volatile, and significant volatility may be
expected in the future. Fluctuations in any particular exchange rate that have
occurred in the past are not necessarily indicative, however, of fluctuations in
the rate that may occur during the term of any Foreign Currency Security.
Changes in the exchange rate of the relevant foreign currency applicable to a
Foreign Currency Security against the U.S. dollar would generally result in
changes in the U.S. dollar-equivalent market value of the Security.
PLAN OF DISTRIBUTION
Securities may be offered and sold by any of three means of distribution:
(1) through agents, (2) through underwriters or dealers or (3) directly to one
or more purchasers. Such underwriters, dealers or agents may be affiliates of
Citicorp, and offers and sales of Securities may include secondary market
transactions by affiliates of Citicorp. The applicable Prospectus Supplement
will set forth the terms of the offering to which such Prospectus Supplement
relates, including the name or names of any underwriters or agents, the public
offering or purchase price, the net proceeds to Citicorp from such sale, any
underwriting discounts and other items constituting underwriters' compensation,
any discounts and commissions allowed or paid to dealers, any commissions
allowed or paid to agents, and the securities exchanges, if any, on which such
Securities will be listed. Dealer trading may take place in certain of the
Securities, including Securities not listed on any securities exchange. Direct
sales may be made on a nationalsecurities exchange or otherwise.
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The Securities may be purchased to be reoffered to the public through
underwriting syndicates led by one or more managing underwriters, or through one
or more underwriters acting alone. Any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers may be changed
from time to time. If so indicated in the applicable Prospectus Supplement,
Citicorp will authorize underwriters or agents to solicit offers by certain
institutions to purchase securities from Citicorp pursuant to Delayed Delivery
Contracts providing for payment and delivery at a future date.
Each underwriter and agent participating in the distribution of any
Euro-Notes will agree that it will not offer, sell or deliver, directly or
indirectly, such Notes, in connection with the sale thereof during the
restricted period, inthe United States or to United States persons, with certain
limited exceptions. See "Limitations on Issuance of Euro-Notes."
Any underwriter or agent participating in the distribution of the
Securities may be deemed to be an underwriter, as that term is defined in the
Securities Act of 1933, as amended (the "Securities Act"), of the Securities so
offered and sold and any discounts or commissions received by them and any
profit realized by them on the sale or resale of the Securities may be deemed to
be underwriting discounts and commissions under the Securities Act.
Underwriters, agents and their controlling persons may be entitled, under
agreements entered into with Citicorp, to indemnification by Citicorp against
certain civil liabilities, including liabilities under the Securities Act.
This Prospectus and related Prospectus Supplements may be used by direct or
indirect subsidiaries of Citicorp in connection with offers and sales related to
secondary market transactions. Such subsidiaries may act as principal or agent
in such transactions. Such sales will be made at prices related to prevailing
market prices at the time of sale.
The participation of an affiliate or subsidiary of Citicorp in the offer
and sale of the Securities will comply with the requirements of Schedule E of
the By-laws of the National Association of Securities Dealers, Inc. (the "NASD")
regarding underwriting securities of an affiliate. No NASD member participating
in offers and sales will execute a transaction in the Securities in a
discretionary account without the prior written specific approval of the
member's customer.
Underwriters, agents or their controlling persons may engage in
transactions with and perform services for Citicorp in the ordinary course of
business.
VALIDITY OF SECURITIES
The validity of the Securities will be passed upon for Citicorp by Stephen
E. Dietz, as an Associate General Counsel of Citibank. Mr. Dietz owns or has the
right to acquire a number of shares of Common Stock of Citicorp equal to less
than 0.01% of the outstanding Common Stock of Citicorp.
EXPERTS
The consolidated financial statements of Citicorp and subsidiaries included
in Citicorp's Annual Report and Form 10-K for 1995 have been incorporated herein
by reference in reliance upon the report set forth therein of KPMG Peat Marwick
LLP, independent certified public accountants, and upon the authority of said
firm as experts in accounting and auditing. The report of KPMG Peat Marwick LLP
covering the December 31, 1995 financial statements refers to the fact that in
1994 Citicorp adopted Statement of Financial Accounting Standards ("SFAS")No.
112, "Employers' Accounting for Postemployment Benefits," and SFAS No. 115,
"Accounting for Certain Investments in Debt and Equity Securities," and in 1993
Citicorp adopted SFAS No. 106, "Employers' Accounting for Postretirement
Benefits Other Than Pensions" and SFAS No. 109, "Accounting for Income Taxes."
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No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus Supplement or the
Prospectus and, if given or made, such information or representation must not be
relied upon as having been authorized. This Prospectus Supplement and the
Prospectus do not constitute an offer to sell or a solicitation of an offer to
buy any securities other than the securities described in this Prospectus
Supplement or an offer to sell or a solicitation of an offer to buy such
securities in any circumstances in which such offer or solicitation is unlawful.
Neither the delivery of this Prospectus Supplement or the Prospectus nor any
sale made hereunder or thereunder shall, under any circumstances, create any
implication that the information contained herein or therein is correct as of
any time subsequent to the date of such information.
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TABLE OF CONTENTS
Prospectus Supplement
Page
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Supplemental Description of
Subordinated Notes ............................................... S-3
Summary Financial Data ............................................. S-6
Ratios of Income to Fixed Charges .................................. S-7
Underwriting ....................................................... S-7
Validity of Subordinated Notes ..................................... S-8
Prospectus
Available Information .............................................. 3
Incorporation of Certain Documents
by Reference ..................................................... 3
Citicorp ........................................................... 3
Use of Proceeds .................................................... 4
Description of Notes ............................................... 4
Foreign Currency Risks ............................................. 16
Plan of Distribution ............................................... 16
Validity of Securities ............................................. 17
Experts ............................................................ 17
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$200,000,000
CITICORP [LOGO]
7 1/4% Subordinated Notes
due September 1, 2008
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PROSPECTUS SUPPLEMENT
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Citicorp Securities, Inc.
Lehman Brothers
Merrill Lynch & Co.
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