PROSPECTUS SUPPLEMENT
(To Prospectus Dated May 21, 1997)
[GRAPHIC OMITTED]
U.S. $7,000,000,000 Global Medium-Term Senior Notes, Series C
U.S. $2,000,000,000 Global Medium-Term Subordinated Notes, Series C
Due from 9 Months to 60 Years from Date of Issue
Citicorp is offering hereby from time to time its Global Medium-Term Senior
Notes, Series C (the "Senior Notes") and its Global Medium-Term Subordinated
Notes, Series C (the "Subordinated Notes", and together with the Senior Notes,
the "Notes"). The Notes offered by this Prospectus Supplement are offered in the
United States. The Senior Notes are offered in an aggregate principal amount of
up to U.S. $7,000,000,000 (including, in the case of Senior Notes denominated in
a foreign currency, the equivalent thereof at the Market Exchange Rate (as
defined herein) on the date of sale of such Senior Notes (the "Trade Date")),
subject to reduction as a result of the sale by Citicorp outside the United
States of Citicorp's Global Medium-Term Senior Notes, Series D. The Subordinated
Notes are offered in an aggregate principal amount of up to U.S. $2,000,000,000
(including, in the case of Subordinated Notes denominated in a foreign currency,
the equivalent thereof at the Market Exchange Rate on the applicable Trade
Date), subject to reduction as a result of the sale by Citicorp outside the
United States of Citicorp's Global Medium-Term Subordinated Notes, Series D. See
"Description of Notes" and "Plan of Distribution of Notes" herein. Each Note
shall have a term to Stated Maturity from 9 months to 60 years from its date of
original issuance (each, an "Issue Date"), as selected by the initial purchaser
and agreed to by Citicorp or as determined by Citicorp prior to its Issue Date.
The Senior Notes are unsecured obligations of Citicorp and the Subordinated
Notes are unsecured and subordinated obligations of Citicorp as described in the
accompanying Prospectus under "Description of Notes". Unless otherwise provided
in the applicable Pricing Supplement, 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 of payment of the Subordinated Notes in the case of a
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.
(Continued on next page)
THESE NOTES 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
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------
Price to Agents' Commissions Proceeds to
Public (1) or Discounts (2) Company (2) (3)
- ------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Note.... 100% .125%-3.00% 99.875%-97.00%
- ------------------------------------------------------------------------------------------
Total (4)... $9,000,000,000 $11,250,000-$270,000,000 $8,988,750,000-$8,730,000,000
- ------------------------------------------------------------------------------------------
</TABLE>
1. Unless otherwise indicated in a pricing supplement, Notes will be issued at
100% of their principal amount.
2. Citicorp will pay Bear, Stearns & Co. Inc., Citicorp Securities, Inc.,
Credit Suisse First Boston Corporation, Donaldson, Lufkin & Jenrette
Securities Corporation, Goldman, Sachs & Co., Lehman Brothers Inc., Merrill
Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co.
Incorporated, PaineWebber Incorporated, Salomon Brothers Inc, Smith Barney
Inc. and UBS Securities LLC, as agents, and such other agents as may be
named from time to time (the "Agents"), a commission (or grant a discount)
ranging from .125% to 3.00% of the principal amount of any Note, depending
on its Stated Maturity and the type of purchaser, sold through any such
Agent, acting as Agent (or sold to any such Agent as principal in
circumstances in which no other discount is agreed), except, in the case of
Notes sold through retail distribution, as otherwise agreed to by Citicorp
and such Agent and as set forth in a pricing supplement. Citicorp also may
sell Notes to any Agent, as principal, for resale to one or more investors
and other purchasers at varying prices relating to prevailing market prices
at the time of resale as determined by such Agent, or, if so agreed, at a
fixed public offering price.
3. Before deducting expenses payable by Citicorp.
4. Or the equivalent thereof in other currencies or currency units.
----------------------
Bear, Stearns, & Co. Inc. Merrill Lynch & Co.
Citicorp Securities, Inc. Morgan Stanley & Co.
Credit Suisse First Boston Incorporated
Donaldson, Lufkin & Jenrette PaineWebber Incorporated
Securities Corporation Salomon Brothers Inc
Goldman, Sachs & Co. Smith Barney Inc.
Lehman Brothers UBS Securities
----------------------
The date of this Prospectus Supplement is May 21, 1997
<PAGE>
(Continued from cover page)
Notes will be sold in issues (each, an "Issue") consisting of one or
more Notes of like tenor and having the same Issue Date. Certain terms of each
Issue of Notes will be established by Citicorp at the time of issuance and will
be set forth in a related supplement accompanying this Prospectus Supplement
(each such supplement, a "Pricing Supplement"), including, without limitation,
the interest rate or interest rate index, if any, the Maximum Interest Rate, if
any, the Minimum Interest Rate, if any, the Specified Currency, issue price,
Issue Date, Stated Maturity, Interest Payment Dates, the Spread and/or Spread
Multiplier, if any, the public offering price, redemption or sinking fund
provisions, if any and the Agent for the Notes being offered and its
compensation (each of the foregoing capitalized terms being defined herein).
Unless otherwise indicated in the applicable Pricing Supplement, the Notes,
except Zero-Coupon Notes (as defined herein) will bear interest at a fixed rate
or a rate or rates determined by reference to an interest rate index or other
formula, as indicated in the applicable Pricing Supplement. For a description of
certain interest rate indices see "Description of Notes--Floating Rate Notes"
herein. Zero-Coupon Notes will be issued at a discount from the principal amount
payable at Maturity (as defined herein) thereof, and Holders of such Notes will
not receive periodic payments of interest.
The Notes may be subject to optional redemption, or obligate Citicorp to
redeem or purchase the Notes pursuant to sinking fund or analogous provisions or
at the option of the Holder thereof, in each case as indicated in the applicable
Pricing Supplement. See "Description of Notes--General". The Notes may also be
issued with the principal amount thereof payable at Maturity and the interest
payable thereon to be determined by reference to one or more financial or other
indices ("Indexed Notes"), as specified in the applicable Pricing Supplement.
The Notes will be represented by one or more permanent global Notes,
registered in the name of The Depository Trust Company, as Depositary (the
"Depositary"), or a nominee of the Depositary (each beneficial interest in a
permanent global Note being referred to herein as a "Book-Entry Note") or, if so
specified in the applicable Pricing Supplement, will be issued in definitive
form. Book-Entry Notes will only be evidenced by, and transfers thereof will be
effected only through, records maintained by the Depositary and its
participants. Except as described herein under "Description of Notes--Book-Entry
Notes", owners of Book-Entry Notes will not be entitled to receive physical
delivery of Notes in definitive form and the Depositary, and not the owners of
beneficial interests in the Notes, will be considered the Holders thereof.
Unless otherwise provided in the applicable Pricing Supplement, the
Notes will be issued in fully registered form in denominations of U.S. $50,000
and integral multiples of U.S. $1,000 in excess thereof.
The Notes are offered on a continuous basis by Citicorp through the
Agents, each of which has agreed to use its reasonable best efforts to solicit
offers to purchase the Notes. Citicorp may also sell Notes to any Agent acting
as principal for resale to one or more investors and other purchasers. Citicorp
also has reserved the right to sell Notes through additional agents or directly
to investors on its own behalf. No commission will be payable nor will a
discount be allowed on any direct sales by Citicorp. The Notes will not be
listed on any securities exchange, unless otherwise indicated in the applicable
Pricing Supplement, and there can be no assurance that the Notes offered by this
Prospectus Supplement will be sold or that there will be a secondary market for
the Notes. Citicorp reserves the right to withdraw, cancel or modify the offer
made hereby without notice. Citicorp or any Agent may reject any offer to
purchase Notes, in whole or in part. See "Plan of Distribution of Notes" herein.
This Prospectus Supplement and Prospectus may be used by Citicorp Securities,
Inc. ("CSI"), a wholly owned subsidiary of Citicorp, in connection with offers
and sales related to secondary market transactions in the Notes. CSI 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.
No dealer, salesman or other person has been authorized to give any
information or to make any representation not contained in this Prospectus
Supplement, any Pricing Supplement or the Prospectus and, if given or made, such
information or representation must not be relied upon as having been authorized
by Citicorp or the Agents. This Prospectus Supplement, any Pricing 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 offered hereby nor do they
constitute an offer to sell or a solicitation of an offer to buy the securities
offered hereby in any jurisdiction to any person to whom it is unlawful to make
such offer or solicitation in such jurisdiction. The delivery of this Prospectus
Supplement, any Pricing Supplement and the Prospectus at any time does not imply
that the information they contain is correct as of any time subsequent to their
respective dates.
S-2
<PAGE>
TABLE OF CONTENTS
Prospectus Supplement
Page No.
--------
Description of Notes....................................................... S-4
General.................................................................. S-4
Interest................................................................. S-5
Fixed Rate Notes......................................................... S-6
Floating Rate Notes...................................................... S-6
Book-Entry Notes......................................................... S-12
United States Taxation..................................................... S-14
United States Holders.................................................... S-14
Payments of Interest..................................................... S-15
Original Issue Discount.................................................. S-15
Notes Purchased at a Premium............................................. S-17
Purchase, Sale and Retirement of Notes................................... S-17
Backup Withholding and Information Reporting............................. S-17
Plan of Distribution of Notes.............................................. S-18
Validity of the Notes...................................................... S-19
Prospectus
Available Information...................................................... 3
Incorporation of Certain Documents by Reference............................ 3
Citicorp................................................................... 4
Holding Company.......................................................... 4
Use of Proceeds............................................................ 4
Ratios of Income to Fixed Charges.......................................... 5
Description of Notes....................................................... 5
General.................................................................. 5
Form, Exchange, Registration and Transfer................................ 7
Payment and Paying Agents................................................ 9
Temporary Global Notes................................................... 10
Permanent Global Notes................................................... 11
Limitations on Liens on Stock of Citibank................................ 11
Defaults; Events of Default.............................................. 11
Meetings, Modification and Waiver........................................ 13
Consolidation, Merger and Sale of Assets................................. 14
Assumption of Obligations................................................ 14
Notices.................................................................. 15
Title.................................................................... 15
Replacement of Notes and Coupons......................................... 15
Defeasance and Covenant Defeasance....................................... 15
Subordination............................................................ 16
Governing Law............................................................ 17
Concerning the Trustees.................................................. 17
Limitations on Issuance of Euro-Notes.................................... 17
Foreign Currency Risks..................................................... 19
General.................................................................. 19
Exchange Rates and Exchange Controls..................................... 19
Plan of Distribution....................................................... 19
Validity of Securities..................................................... 20
Experts.................................................................... 21
S- 3
<PAGE>
DESCRIPTION OF NOTES
The following description of the particular terms of the Notes offered
hereby supplements the description of the general terms and provisions of Notes
set forth under the heading "Description of Notes" in the accompanying
Prospectus, to which description reference is hereby made. Capitalized terms not
defined herein have the meanings assigned to such terms in the accompanying
Prospectus and the Senior Indenture, in the case of Senior Notes, and the
Subordinated Indenture, in the case of the Subordinated Notes (each as defined
below). The following description of the Notes will apply unless otherwise
stated in the applicable Pricing Supplement.
General
The Senior Notes offered hereby will be issued under the 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 such First Supplemental Indenture
and any additional supplemental indentures thereto, is hereinafter referred to
as the "Senior Indenture"). The Subordinated Notes offered hereby will be issued
under the Indenture, dated as of April 1, 1991, between Citicorp and The Chase
Manhattan Bank (formerly known as Chemical Bank), as Trustee (the "Subordinated
Trustee" and together with the Senior Trustee, the "Trustees"), as supplemented
by the First Supplemental Indenture dated as of November 27, 1992 and the Second
Supplemental Indenture dated as of December 17, 1996, each between Citicorp and
the Subordinated Trustee (such Indenture, together with such First Supplemental
Indenture, Second Supplemental Indenture and any additional supplemental
indentures thereto, is hereinafter referred to as the "Subordinated Indenture";
the Subordinated Indenture together with the Senior Indenture, the "Indentures";
and each, an "Indenture"). The Senior Notes and the Subordinated Notes each
constitute a single series for purposes of the applicable Indenture and are
limited to an aggregate principal amount of up to U.S. $7,000,000,000 in the
case of the Senior Notes, and up to U.S. $2,000,000,000 in the case of the
Subordinated Notes, subject to reduction as the result of the sale by Citicorp
outside the United States of Citicorp's Global Medium-Term Senior Notes, Series
D (in the case of the Senior Notes) and Citicorp's Global Medium-Term
Subordinated Notes, Series D (in the case of the Subordinated Notes), or by or
pursuant to action of Citicorp's Board of Directors, provided that no such
reduction will affect any Note already issued or as to which an offer to
purchase has been accepted by Citicorp. See "Plan of Distribution of Notes"
herein. The foregoing limits, however, may be increased by Citicorp if in the
future it determines that it may wish to sell additional Notes. The following
description of the particular terms of the Notes applies to definitive Notes and
to any permanent global Note or Notes representing Book-Entry Notes. For a
description of special provisions that apply to Book-Entry Notes, see
"Book-Entry Notes" below.
The Senior Notes will be unsecured and will rank pari passu with all
other unsecured and unsubordinated indebtedness of Citicorp. The Subordinated
Notes 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 evidencing or creating the same or pursuant to which
the same is outstanding, it is provided that such indebtedness is junior to the
Subordinated Notes.
The Notes will be issuable only in fully registered form and, unless
otherwise provided in the applicable Pricing Supplement, the Notes will be
issuable only in denominations of U.S. $50,000 and integral multiples of U.S.
$1,000 in excess thereof.
The Notes 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 at the Stated Maturity thereof and
which provides that upon redemption or acceleration of the Stated Maturity
thereof an amount less than the principal amount payable at the Stated Maturity
thereof and determined in accordance with the terms thereof shall become due and
payable. Original Issue Discount Notes, as well as certain other Notes offered
hereunder, may, for United States federal income tax purposes, be considered
"Discount Notes". Certain Holders of, or owners of beneficial interests in,
Original Issue Discount Notes having a Stated Maturity of more than one year
from their date of issue will have to include original issue
S- 4
<PAGE>
discount in income as it accrues, generally before receipt of cash attributable
to such income. Additional United States federal income tax consequences of the
ownership of Discount Notes are described under "United States
Taxation--Original Issue Discount" herein. A "Zero-Coupon Note" means a Note
that does not bear interest prior to Maturity.
The Notes may be issued as Indexed Notes, as set forth in the applicable
Pricing Supplement. Holders of Indexed Notes may receive a principal amount at
Maturity that is greater than or less than the face amount of such Notes
depending upon the fluctuation of the relative value, rate or price of the
specified index. The Pricing Supplement relating to an Issue of Indexed Notes
will contain specific information pertaining to the method for determining the
principal amount payable at Maturity, a historical comparison of the relative
value, rate or price of the specified index, the face amount of the Indexed
Note, certain additional tax considerations, and the manner of calculation of
the amount principal or interest payable if the specified index is no longer
calculated or published.
The "Stated Maturity"' of an Issue of Notes shall be the date specified
in the applicable Pricing Supplement as the fixed date on which the principal of
such Notes is due and payable. The "Maturity" of an Issue of Notes shall be the
date on which the principal of such Notes becomes due and payable, whether at
Stated Maturity, by acceleration, redemption or otherwise.
The applicable Pricing Supplement will indicate either that a Note
cannot be redeemed prior to its Stated Maturity or that a Note will be
redeemable at the option of Citicorp on or after a specified date prior to its
Stated Maturity at a specified price or prices (which may include a premium),
together with accrued interest to the date of redemption. In addition, the
applicable Pricing Supplement will indicate whether Citicorp will be obligated
to redeem or purchase a Note pursuant to any sinking fund or analogous
provisions or at the option of the Holder thereof. If Citicorp will be so
obligated, the applicable Pricing Supplement will indicate the period or periods
within which and the price or prices at which the applicable Notes will be
redeemed or purchased, in whole or in part, pursuant to such obligation and the
other detailed terms and provisions of such obligation.
Unless otherwise indicated in the applicable Pricing Supplement, the
Notes will be denominated in U.S. dollars and payments of principal of and any
premium and interest on such Notes will be made in U.S. dollars in the manner
described in this Prospectus Supplement under "Book-Entry Notes" below and in
the accompanying Prospectus under the caption "Description of Notes--Payment and
Paying Agents".
Payments of principal of and any premium and interest payable at
Maturity on a Note denominated in U.S. dollars will be made in immediately
available funds at the offices of Citibank, N.A. ("Citibank"), as Paying Agent
(the "Paying Agent"), in the Borough of Manhattan, The City of New York,
provided that the Note is presented to the Paying Agent in time for the Paying
Agent to make such payments in such funds in accordance with its normal
procedures.
The Notes may be presented for registration of transfer or exchange at
the offices of Citibank in the Borough of Manhattan, The City of New York.
For a description of the rights attaching to series of Notes under the
applicable Indenture, see "Description of Notes" in the accompanying Prospectus.
The provisions of the Indentures described under "Description of
Notes--Defeasance and Covenant Defeasance" in the accompanying Prospectus apply
to the Notes.
Interest
Each Note, except a Zero-Coupon Note, will bear interest from and
including its Issue Date or from and including the most recent Interest Payment
Date (or, in the case of a Floating Rate Note with daily or weekly Interest
Reset Dates, the day following the most recent Regular Record Date) with respect
to which interest on such Note (or any predecessor Note) has been paid or duly
provided for at the fixed rate per annum, or at the rate per annum determined
pursuant to the interest rate index specified in the applicable
S- 5
<PAGE>
Pricing Supplement, until the principal thereof is paid or made available for
payment. Interest will be payable on each Interest Payment Date and at Maturity.
Interest will be payable generally to the Person in whose name a Note (or any
predecessor Note) is registered at the close of business on the Regular Record
Date next preceding each Interest Payment Date; provided, however, that interest
payable at Maturity will be payable to the Person to whom principal shall be
payable. The first payment of interest on any Note originally issued between a
Regular Record Date and an Interest Payment Date will be made on the second
Interest Payment Date following the Issue Date of such Note to the registered
owner on the Regular Record Date immediately preceding such Interest Payment
Date.
Each Note, except a Zero-Coupon Note, will bear interest at either (a)
a fixed rate or rates (a "Fixed Rate Note") or (b) a variable rate determined by
reference to an interest rate index or formula (a "Floating Rate Note"), which
may be adjusted by adding or subtracting the Spread and/or multiplying by the
Spread Multiplier, unless otherwise indicated in the applicable Pricing
Supplement. Holders of Zero-Coupon Notes will receive no periodic payments of
interest on such Notes.
Unless otherwise specified in the applicable Pricing Supplement,
interest shall accrue on the Notes of any Issue from the period beginning on and
including the Issue Date of such Notes and ending on and excluding the first
Interest Payment Date with respect to such Notes and each successive period
beginning on and including each Interest Payment Date and ending on and
excluding the next successive Interest Payment Date or at Maturity (each such
period, an "Interest Period").
In addition to any Maximum Interest Rate which may be applicable to any
Note, the interest rate on the Notes will in no event be higher than the maximum
rate permitted by New York law, as the same may be modified by United States law
of general application. Under present New York law, the maximum rate of interest
is 25% per annum on a simple interest basis. The limit does not apply to Notes
in which U.S.
$2,500,000 or more has been invested.
Fixed Rate Notes
The applicable Pricing Supplement relating to a Fixed Rate Note will
designate a fixed rate of interest per annum payable on such Note. Unless
otherwise indicated in the applicable Pricing Supplement, the Interest Payment
Dates for Fixed Rate Notes will be February 15 and August 15 of each year and at
Maturity and the Regular Record Dates for Fixed Rate Notes will be the February
1 or August 1, as the case may be, next preceding such Interest Payment Dates.
Unless otherwise indicated in the applicable Pricing Supplement, interest
payments for Fixed Rate Notes shall be the amount of interest accrued to but
excluding the relevant Interest Payment Date. Interest on such Notes will be
computed on the basis of a 360-day year of twelve 30-day months. Unless
otherwise specified in the applicable Pricing Supplement, if any Interest
Payment Date or the Maturity with respect to a Fixed Rate Note falls on a day
that is not a Market Day (as defined below), payments due shall be made on the
next succeeding Market Day as if they were made on the date such payments were
due and no interest will accrue on the amounts so payable for the period from
and after such Interest Payment Date or such Maturity, as the case may be.
Floating Rate Notes
The applicable Pricing Supplement relating to a Floating Rate Note will
designate an interest rate index for such Floating Rate Note. Such index may be:
(a) the Commercial Paper Rate, in which case such Note will be a "Commercial
Paper Rate Note"; (b) LIBOR, in which case such Note will be a "LIBOR Note"; (c)
the Treasury Rate, in which case such Note will be a "Treasury Rate Note"; (d)
the Certificate of Deposit Rate, in which case such Note will be a "CD Rate
Note"; (e) the Federal Funds Effective Rate, in which case such Note will be a
"Federal Funds Rate Note"; (f) the Prime Rate, in which case such Note will be a
"Prime Rate Note"; (g) the Constant Maturity Treasury Rate, in which case such
Note will be a "CMT Rate Note"; or (h) such other interest rate index or formula
as is set forth in such Pricing Supplement. In addition, such Pricing Supplement
will specify for each Floating Rate Note the following terms, if applicable:
Calculation Dates; Initial Interest Rate; Maximum Interest Rate; Minimum
Interest Rate; Spread and/or Spread Multiplier; Interest Payment Dates; Regular
Record Dates; Index Maturity; Interest
S- 6
<PAGE>
Determination Dates and Interest Reset Dates (each as defined below). "Spread"
means the number of basis points, as specified in the applicable Pricing
Supplement, as being applicable to the interest rate for a particular Floating
Rate Note and "Spread Multiplier" means the percentage, as specified in the
applicable Pricing Supplement, as being applicable to the interest rate for a
particular Floating Rate Note.
"Calculation Date" means the date, as specified in the applicable
Pricing Supplement, on which the Calculation Agent is to calculate the interest
rate for a Floating Rate Note.
"Market Day" means (a) with respect to any Note, any day that is not a
Saturday or Sunday and that, in The City of New York, is not a day on which
banking institutions generally are authorized or obligated by law or executive
order to close and (b) with respect to LIBOR Notes only, any such day on which
dealings in deposits in U.S. dollars are transacted in the London interbank
market.
The rate of interest on each Floating Rate Note will be reset daily,
weekly, monthly, quarterly, semi-annually or annually (each, an "Interest Reset
Date"), as specified in the applicable Pricing Supplement. The interest rate in
effect from the Issue Date of a Floating Rate Note to the first Interest Reset
Date will be the "Initial Interest Rate"and will be set forth or calculated as
described in the applicable Pricing Supplement. Unless otherwise specified in
the applicable Pricing Supplement, the interest rate in effect for the ten days
immediately prior to Maturity of any installment of principal will be that in
effect on the tenth day preceding the Maturity. If any Interest Reset Date for
any Floating Rate Note would otherwise be a day that is not a Market Day, the
Interest Reset Date for such Floating Rate Note shall be the next succeeding
Market Day, except that in the case of a LIBOR Note, if such Market Day is in
the next succeeding calendar month, such Interest Reset Date shall be the
immediately preceding Market Day.
"Interest Determination Date" means, with respect to any Note, the
date, as specified in the applicable Pricing Supplement, as of which the rate of
interest in effect on an Interest Reset Date will be determined. Unless
otherwise specified in the applicable Pricing Supplement, the Interest
Determination Date pertaining to an Interest Reset Date for (a) a Floating Rate
Note other than a Treasury Rate Note will be the second Market Day preceding
such Interest Reset Date and (b) a Treasury Rate Note will be the day of the
week in which such Interest Reset Date falls on which Treasury bills are
auctioned. Treasury bills are normally sold at auction on Monday of each week,
unless that day is a legal holiday, in which case the auction is usually held on
the following Tuesday, except that such auction may be held on the preceding
Friday. If, as the result of a legal holiday, an auction is so held on the
preceding Friday, such Friday will be the Interest Determination Date pertaining
to the Interest Reset Date occurring in the next succeeding week. If an auction
date shall fall on a day which would otherwise be an Interest Reset Date for a
Treasury Rate Note, then such Interest Reset Date shall be the first Market Day
immediately following such auction date.
If specified in the applicable Pricing Supplement, a Floating Rate Note
may have either or both of the following: (a) a maximum numerical interest rate
limitation, or ceiling, on the rate of interest which may accrue during any
Interest Period (a "Maximum Interest Rate") and (b) a minimum numerical interest
rate limitation, or floor, on the rate of interest which may accrue during any
Interest Period (a "Minimum Interest Rate").
"Interest Payment Dates" means, with respect to any Note, the dates, as
specified in the applicable Pricing Supplement, on which accrued interest on
such Note is due and payable, provided, however, if an Interest Payment Date
with respect to any Floating Rate Note (other than an Interest Payment Date
occurring on Maturity) would otherwise be a day that is not a Market Day, such
Interest Payment Date will be the next succeeding Market Day, except that, in
the case of a LIBOR Note, if the next succeeding Market Day is in the next
succeeding calendar month, such Interest Payment Date will be the immediately
preceding Market Day. If the Maturity with respect to any Floating Rate Note
would otherwise fall on a day that is not a Market Day, any payments due shall
be made on the next succeeding Market Day and no interest on such payments will
accrue for the period from and after such Maturity. The "Regular Record Date"
with respect to Floating Rate Notes shall be the date 15 calendar days prior to
each Interest Payment Date, whether or not such date shall be a Market Day.
S- 7
<PAGE>
Unless otherwise indicated in the applicable Pricing Supplement,
interest payments for a Floating Rate Note shall be the amount of interest
accrued to, but excluding, the Interest Payment Date or Maturity; provided,
however, that if the Interest Reset Dates with respect to any Floating Rate Note
are daily or weekly, interest payable on any Interest Payment Date, other than
interest payable on any date on which principal on any such Note is payable,
will include interest accrued to and including the next preceding Regular Record
Date.
Accrued interest on any Floating Rate Note from its Issue Date or from
the last date to which interest has been paid or duly provided for is calculated
by multiplying the face amount of such Floating Rate Note by an accrued interest
factor. Such accrued interest factor is computed by adding the interest factor
calculated for each day from the Issue Date or from the last date to which
interest has been paid or duly provided for, as the case may be, to the date for
which accrued interest is being calculated. Unless otherwise specified in the
applicable Pricing Supplement, the interest factor for each such day is computed
by dividing the interest rate applicable to such date by 360 (or by the actual
number of days in the year, in the case of Treasury Rate Notes or CMT Rate
Notes).
Unless otherwise specified in the applicable Pricing Supplement, all
percentages resulting from any calculation on Floating Rate Notes will be
rounded, if necessary, to the nearest one-hundred thousandth of a percentage
point, with five one-millionths of a percentage point rounded upwards, and all
dollar amounts used in or resulting from such calculation will be rounded to the
nearest cent (with one-half cent being rounded upwards).
Upon the request of the Holder of any Floating Rate Note, the
Calculation Agent will provide the interest rate then in effect and, if
determined, the interest rate which will become effective as a result of a
determination made on the most recent Interest Determination Date with respect
to such Floating Rate Note. The "Calculation Agent" means the agent appointed by
Citicorp to calculate interest rates under the circumstances specified below for
Floating Rate Notes. Unless otherwise provided in an applicable Pricing
Supplement, the Calculation Agent will be Citibank.
Commercial Paper Rate Notes. Each Commercial Paper Rate Note will
bear interest at the interest rate (calculated with reference to the Commercial
Paper Rate and the Spread and/or Spread Multiplier, if any) specified in the
applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement,
"Commercial Paper Rate" means, with respect to any Interest Determination Date,
the Money Market Yield (calculated as described below) of the rate quoted on a
discount basis on such date for commercial paper having the Index Maturity
specified in the applicable Pricing Supplement as published in H.15(519) under
the heading "Commercial Paper". In the event that such rate is not published
prior to 9:00 A.M., New York City time, on the Calculation Date pertaining to
such Interest Determination Date, then the Commercial Paper Rate shall be the
Money Market Yield of the rate on such Interest Determination Date for
commercial paper having the Index Maturity specified in the applicable Pricing
Supplement as published in Composite Quotations under the heading "Commercial
Paper". If such rate is neither published in H.15(519) by 9:00 A.M., New York
City time, on such Calculation Date nor in Composite Quotations by 3:00 P.M.,
New York City time, on such Calculation Date, the Commercial Paper Rate for that
Interest Determination Date will be calculated by the Calculation Agent and
shall be the Money Market Yield of the arithmetic mean of the offered rates, as
of 11:00 A.M., New York City time, on that Interest Determination Date, of three
leading dealers of commercial paper in The City of New York selected by the
Calculation Agent for commercial paper having the Index Maturity specified in
the applicable Pricing Supplement placed for an industrial issuer whose senior
unsecured bond rating is "AA", or the equivalent, from a nationally recognized
rating agency; provided, however, that if the dealers selected as aforesaid by
the Calculation Agent are not quoting as mentioned in this sentence, the
Commercial Paper Rate will be the Commercial Paper Rate in effect on such
Interest Determination Date.
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"Money Market Yield" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
D x 360
Money Market Yield = ------------ x 100
360 - (D x M)
where "D" refers to the per annum rate for commercial paper quoted on a bank
discount basis and expressed as a decimal; and "M" refers to the actual number
of days in the interest period for which interest is being calculated.
"Index Maturity" means, with respect to a Floating Rate Note, the
period to maturity of the instrument or obligation on which the interest rate
index is based, as indicated in the applicable Pricing Supplement. "Composite
Quotations" means the daily statistical release entitled "Composite Quotations
for U.S. Government Securities", or any successor publication, published by the
Federal Reserve Bank of New York. "H.15(519)" means the weekly statistical
release entitled "Statistical Release H.15(519), Selected Interest Rates", or
any successor publication, published by the Board of Governors of the Federal
Reserve System.
LIBOR Notes. Each LIBOR Note will bear interest at the interest rate
(calculated with reference to LIBOR and the Spread and/or Spread Multiplier, if
any) specified in the applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement, LIBOR
will be determined by the Calculation Agent in accordance with the following
provisions:
(a) With respect to any Interest Determination Date, LIBOR will be, as
specified in the applicable Pricing Supplement, either (i) the arithmetic mean
of the offered rates for deposits in U.S. dollars having the Index Maturity
specified in the applicable Pricing Supplement, commencing on the second Market
Day immediately following such Interest Determination Date, which appear on the
Reuters Screen LIBO Page (as defined below) as of 11:00 A.M., London time, on
such Interest Determination Date, if at least two such offered rates appear on
the Reuters Screen LIBO Page, or (ii) the rate for deposits in U.S. dollars
having the Index Maturity specified in the applicable Pricing Supplement,
commencing on the second Market Day immediately following the Interest
Determination Date that appears on the Telerate Screen Page 3750 (as defined
below) as of 11:00 A.M. on that Interest Determination Date. "Reuters Screen
LIBO Page" means the display designated as page "LIBO" on the Reuters Monitor
Money Rates Service (or such other page as may replace the LIBO page on that
service for the purpose of displaying London interbank offered rates of major
banks or a comparable display, as determined in the sole discretion of and
selected by the Calculation Agent, of London interbank offered rates or major
bank offered rates, as may be available from a similar service). "Telerate
Screen Page 3750" means the display designated as page "British Bankers Assoc.
Interest Settlement Rates" on the Telerate system, page 3750 (or such other page
or pages as may replace such page on the system for the purpose of displaying
such rates). If fewer than two offered rates appear on the Reuters Screen LIBO
Page, or if no rate appears on Telerate Page 3750, as applicable, LIBOR for such
Interest Determination Date will be determined as described in (b) below. The
selection of the Reuters Screen LIBO Page or the Telerate Screen Page 3750 shall
be as specified in the applicable Pricing Supplement. If neither Reuters Screen
LIBO or Telerate Screen 3750 is specified in the applicable Pricing Supplement,
LIBOR will be determined as if Telerate Screen 3750 had been specified.
(b) With respect to an Interest Determination Date on which fewer than
two offered rates for the applicable Index Maturity appear on the Reuters Screen
LIBO Page as specified in (a)(i) above, or on which no rate appears on the
Telerate Screen Page 3750 as specified in (a)(ii) above, LIBOR will be
determined on the basis of the rates at approximately 11:00 A.M., London time on
such Interest Determination Date at which deposits in U.S. dollars having the
Index Maturity designated in the applicable Pricing Supplement, commencing on
the second Market Day immediately following such Interest Determination Date and
in a principal amount of not less than U.S. $1,000,000 and representative for a
single transaction in such market at such time, are offered to prime banks in
the London interbank market by four major banks in the London interbank market
selected by the
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Calculation Agent. The Calculation Agent will request the principal London
office of each of such banks to provide a quotation of its rate. If at least two
such quotations are provided, LIBOR for such LIBOR Interest Determination Date
will be the arithmetic mean of such quotations. If fewer than two quotations are
provided, LIBOR for such Interest Determination Date will be the arithmetic mean
of the rates quoted at approximately 11:00 A.M., New York City time, on such
Interest Determination Date by three major banks in The City of New York
selected by the Calculation Agent for loans in U.S. dollars to leading European
banks having the applicable Index Maturity commencing on the second Market Day
immediately following such Interest Determination Date and in a principal amount
of not less than U.S. $1,000,000 that is representative for a single transaction
in such market at such time; provided, however, that if the banks selected as
aforesaid by the Calculation Agent are not quoting as mentioned in this
sentence, LIBOR will be LIBOR in effect on such Interest Determination Date.
Treasury Rate Notes. Each Treasury Rate Note will bear interest at the
interest rate (calculated with reference to the Treasury Rate and the Spread
and/or Spread Multiplier, if any) specified in the applicable Pricing
Supplement.
Unless otherwise indicated in the applicable Pricing Supplement,
"Treasury Rate" means, with respect to any Interest Determination Date, the rate
for the most recent auction of direct obligations of the United States
("Treasury bills") having the Index Maturity specified in the applicable Pricing
Supplement as published in H.15(519) under the heading "U.S. Government
Securities/Treasury Bills/Auction Average (Investment)" or, if not so published
by 9:00 A.M., New York City time, on the Calculation Date pertaining to such
Interest Determination Date, the auction average rate (expressed as a bond
equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) for such auction as otherwise announced by the United
States Department of the Treasury. In the event that the results of the auction
of Treasury bills having the Index Maturity specified in the applicable Pricing
Supplement are neither published in H.15(519) by 9:00 A.M., New York City time,
on such Calculation Date, nor otherwise published or reported as provided above
by 3:00 P.M., New York City time, on such Calculation Date, or if no such
auction is held in a particular week, then the Treasury Rate will be calculated
by the Calculation Agent and will be a yield to maturity (expressed as a bond
equivalent, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) of the arithmetic mean of the secondary market bid
rates as of approximately 3:30 P.M., New York City time, on such Interest
Determination Date, of three leading primary United States government securities
dealers selected by the Calculation Agent for the issue of Treasury bills with a
remaining maturity closest to the specified Index Maturity; provided, however,
that if the dealers selected as aforesaid by the Calculation Agent are not
quoting as mentioned in this sentence, the Treasury Rate will be the Treasury
Rate in effect on such Interest Determination Date.
CD Rate Notes. Each CD Rate Note will bear interest at the interest rate
(calculated with reference to the CD Rate and the Spread and/or Spread
Multiplier, if any) specified in the applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement, "CD
Rate " means, with respect to any Interest Determination Date, the rate on such
date for negotiable certificates of deposit having the Index Maturity specified
in the applicable Pricing Supplement as published in H.15(519) under the heading
"CDs (Secondary Market)". In the event that such rate is not so published by
9:00 A.M., New York City time, on the Calculation Date pertaining to such
Interest Determination Date, the CD Rate will be the rate on such Interest
Determination Date for negotiable certificates of deposit having the Index
Maturity specified in the applicable Pricing Supplement as published in
Composite Quotations under the heading "Certificates of Deposit". If such rate
is neither published in H.15(519) by 9:00 A.M., New York City time, on such
Calculation Date nor in Composite Quotations by 3:00 P.M., New York City time,
on such Calculation Date, the CD Rate for such Interest Determination Date will
be calculated by the Calculation Agent and will be the arithmetic mean of the
secondary market offered rates as of 10:00 A.M., New York City time, on such
Interest Determination Date, of three leading nonbank dealers of negotiable U.S.
dollar certificates of deposit in The City of New York selected by the
Calculation Agent for negotiable certificates of deposit of major United States
money market banks (in the market for negotiable certificates of deposit) with a
remaining maturity closest to the Index Maturity specified in the applicable
Pricing Supplement in a denomination of
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$5,000,000; provided, however, that if the dealers selected as aforesaid by the
Calculation Agent are not quoting as mentioned in this sentence, the CD Rate
will be the CD Rate in effect on such Interest Determination Date.
Federal Funds Rate Notes. Each Federal Funds Rate Note will bear
interest at the interest rate (calculated with reference to the Federal Funds
Effective Rate and the Spread and/or Spread Multiplier, if any) specified in the
applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement,
"Federal Funds Effective Rate" means, with respect to any Interest Determination
Date, the rate on that date for Federal Funds having the Index Maturity
specified in the applicable Pricing Supplement as published in H.15(519) under
the heading "Federal Funds (Effective)". In the event that such rate is not so
published by 9:00 A.M., New York City time, on the Calculation Date pertaining
to such Interest Determination Date, the Federal Funds Effective Rate will be
the rate on such Interest Determination Date as published in Composite
Quotations under the heading "Federal Funds/Effective Rate". If such rate is
neither published in H.15(519) by 9:00 A.M., New York City time, on such
Calculation Date nor in Composite Quotations by 3:00 P.M., New York City time,
on such Calculation Date, the Federal Funds Effective Rate for such Interest
Determination Date will be calculated by the Calculation Agent and will be the
arithmetic mean of the rates as of 9:00 A.M., New York City time, on such
Interest Determination Date for the last transaction in overnight Federal Funds
arranged by three leading brokers of Federal Funds transactions in The City of
New York selected by the Calculation Agent; provided, however, that if the
brokers selected as aforesaid by the Calculation Agent are not quoting as
mentioned in this sentence, the Federal Funds Effective Rate will be the Federal
Funds Effective Rate in effect on such Interest Determination Date.
Prime Rate Notes. Each Prime Rate Note will bear interest at the
interest rate (calculated with reference to the Prime Rate and the Spread and/or
Spread Multiplier, if any) specified in the applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement, "Prime
Rate" means, with respect to any Interest Determination Date, the rate set forth
on such date in H.15(519) under the heading "Bank Prime Loan". In the event that
such rate is not published prior to 9:00 A.M., New York City time, on the
Calculation Date pertaining to such Interest Determination Date, then the Prime
Rate will be determined by the Calculation Agent and will be the arithmetic mean
of the rates of interest publicly announced by each bank that appears on the
Reuters Screen NYMF Page (as defined below) as such bank's prime rate or base
lending rate as in effect for that Interest Determination Date. If fewer than
four such rates but more than one such rate appear on the Reuters Screen NYMF
Page for the Interest Determination Date, the Prime Rate will be determined by
the Calculation Agent and will be the arithmetic mean of the prime rates quoted
on the basis of the actual number of days in the year divided by a 360-day year
as of the close of business on such Interest Determination Date by four major
money center banks in The City of New York selected by the Calculation Agent. If
fewer than two such rates appear on the Reuters Screen NYMF Page, the Prime Rate
will be determined by the Calculation Agent on the basis of the rates furnished
in The City of New York by the appropriate number of substitute banks or trust
companies organized and doing business under the laws of the United States, or
any State thereof, having total equity capital of at least U.S. $500,000,000 and
being subject to supervision or examination by Federal or State authority,
selected by the Calculation Agent to provide such rate or rates; provided,
however, that if the banks selected as aforesaid are not quoting as mentioned in
this sentence, the Prime Rate will be the Prime Rate in effect on such Interest
Determination Date. "Reuters Screen NYMF Page" means the display designated as
page "NYMF" on the Reuters Monitor Money Rates Service (or such other page as
may replace the NYMF page on that service for the purpose of displaying prime
rates or base lending rates of major United States banks).
CMT Rate Notes. CMT Rate Notes will bear interest at the rates
(calculated with reference to the CMT Rate and the Spread and/or Spread
Multiplier, if any) specified in such CMT Rate Notes and any applicable Pricing
Supplement.
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Unless otherwise specified in the applicable Pricing Supplement, "CMT
Rate" means, with respect to any Interest Determination Date, the rate displayed
on the Designated CMT Telerate Page (as defined below) under the caption ". . .
Treasury Constant Maturities . . . Federal Reserve Board Release H.15 . . .
Mondays Approximately 3:45 P.M.", under the column for the Index Maturity for
(i) if the Designated CMT Telerate Page is 7055, such Interest Determination
Date and (ii) if the Designated CMT Telerate Page is 7052, the week, or the
month, as set forth in the applicable Pricing Supplement, ended immediately
preceding the week in which the related Interest Determination Date occurs. If
such rate is no longer displayed on the relevant page, or if not displayed by
3:00 P.M., New York City time, on the related Calculation Date, then the CMT
Rate for such Interest Determination Date will be such treasury constant
maturity rate for the Index Maturity as published in the relevant H.15(519). If
such rate is no longer published, or if not published by 3:00 P.M., New York
City time, on the related Calculation Date, then the CMT Rate for such Interest
Determination Date will be such treasury constant maturity rate for the Index
Maturity (or other United States Treasury rate for the Index Maturity) for the
Interest Determination Date as may then be published by either the Board of
Governors of the Federal Reserve System or the United States Department of the
Treasury that the Calculation Agent determines to be comparable to the rate
formerly displayed on the Designated CMT Telerate Page and published in the
relevant H.15(519). If such information is not provided by 3:00 P.M., New York
City time, on the related Calculation Date, then the CMT Rate for the Interest
Determination Date will be calculated by the Calculation Agent and will be a
yield to maturity, based on the arithmetic mean of the secondary market closing
mid-market prices as of approximately 3:30 P.M., New York City time, on the
Interest Determination Date reported, according to their written records, by
three leading primary United States government securities dealers (each, a
"Reference Dealer") in The City of New York (which may include an Agent or its
affiliates) selected by the Calculation Agent (from five such Reference Dealers
selected by the Calculation Agent and eliminating the highest quotation (or, in
the event of equality, one of the highest) and the lowest quotation (or, in the
event of equality, one of the lowest)), for the most recently issued direct
noncallable fixed rate obligations of the United States ("Treasury Notes") with
an original maturity of approximately the Index Maturity and a remaining term to
maturity of not less than such Index Maturity minus one year. If the Calculation
Agent cannot obtain three such Treasury Note quotations, the CMT Rate for such
Interest Determination Date will be calculated by the Calculation Agent and will
be a yield to maturity based on the arithmetic mean of the secondary market
closing mid-market prices as of approximately 3:30 P.M., New York City time, on
the Interest Determination Date of three Reference Dealers in The City of New
York (from five such Reference Dealers selected by the Calculation Agent and
eliminating the highest quotation (or, in the event of equality, one of the
highest) and the lowest quotation (or, in the event of equality, one of the
lowest)), for Treasury Notes with an original maturity of the number of years
that is the next highest to the Index Maturity and a remaining term to maturity
closest to the Index Maturity and in an amount of at least $100 million. If
three or four (and not five) of such Reference Dealers are quoting as described
above, then the CMT Rate will be based on the arithmetic mean of the offer
prices obtained and neither the highest nor the lowest of such quotes will be
eliminated; provided, however, that if fewer than three Reference Dealers
selected by the Calculation Agent are quoting as described herein, the CMT Rate
will be the CMT Rate in effect on such Interest Determination Date. If two
Treasury Notes with an original maturity as described in the third preceding
sentence have remaining terms to maturity equally close to the Index Maturity,
the quotes for the Treasury Note with the shorter remaining term to maturity
will be used.
"Designated CMT Telerate Page" means the display on the Dow Jones
Telerate Service on the page designated in the applicable Pricing Supplement (or
any other page as may replace such page on that service for the purpose of
displaying Treasury Constant Maturities as reported in H.15(519)), for the
purpose of displaying Treasury Constant Maturities as reported in H.15(519). If
no such page is specified in the applicable Pricing Supplement, the Designated
CMT Telerate Page shall be 7052, for the most recent week.
Book-Entry Notes
Upon issuance, all Book-Entry Notes of the same Issue will be
represented by one or more permanent global Notes (the "Global Notes"). Each
Global Note will be deposited with, or on behalf of, the Depositary, located in
the Borough of Manhattan, The City of New York, and will be registered in the
name of the Depositary or a nominee of the Depositary. Unless otherwise
specified in the applicable Pricing Supplement, all Global Notes will be
denominated in U.S. dollars only.
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Ownership of Book-Entry Notes will be limited to institutions that have
accounts with the Depositary or its nominee ("participants") or persons that may
hold interests through participants. In addition, ownership of Book-Entry 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 Book-Entry 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 Book-Entry
Notes.
Citicorp has been advised by the Depositary that upon the issuance of a
Global Note, and the deposit of such Global Note 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
Book-Entry Notes represented by such Global Note to the accounts of
participants. The accounts to be credited shall be designated by the soliciting
Agent, or by Citicorp if such Notes are offered and sold directly by Citicorp.
Payments of principal of and any premium and interest on Book-Entry
Notes represented by Global Notes 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 Global Notes
representing such Book-Entry Notes. 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 payments of principal and any premium,
the Global Notes 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 Trustees or any agent of Citicorp or either 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
Book-Entry Notes or for maintaining, supervising or reviewing any of the
Depositary's records or any participant's records relating to such Book-Entry
Notes.
Citicorp has been advised by the Depositary that upon receipt of any
payment of principal of or any premium or interest in respect of a Global Note,
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 the principal amount of such Global
Note as shown on the records of the Depositary. Payments by participants to
owners of Book-Entry 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.
No Global Note described above may be transferred except as a whole by
the Depositary for such Global Note to a nominee of the Depositary or by a
nominee of the Depositary to another nominee of the Depositary.
Book-Entry Notes represented by a Global Note are exchangeable for
definitive 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 such Global Note 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 Book-Entry Notes shall be
exchangeable for definitive 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 such Notes. Any Global Note
representing Book-Entry Notes that is exchangeable pursuant to the preceding
sentence shall be exchangeable in whole for definitive Notes in registered form,
of like tenor and of an equal aggregate principal amount, in denominations of
U.S. $50,000 and integral multiples of U.S. $1,000 in excess thereof. Such
definitive 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 Book-Entry Notes.
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Except as provided above, owners of Book-Entry Notes will not be
entitled to receive physical delivery of Notes in definitive form and will not
be considered the Holders of Notes for any purpose under the applicable
Indenture, and no Global Note representing Book-Entry Notes shall be
exchangeable, except for another Global Note of like denomination and tenor to
be registered in the name of the Depositary or its nominee. Accordingly, each
person owning a Book-Entry 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 applicable Indenture. Each 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 applicable
Indenture. Citicorp understands that under existing industry practices, in the
event that Citicorp requests any action of Holders or an owner of a Book-Entry
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 Book-Entry 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 Agents), banks, trust
companies, clearing 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.
UNITED STATES TAXATION
The following is a summary of the principal United States federal income
tax consequences of the ownership and disposition of Notes by United States
Holders. It deals only with Notes held as capital assets by initial purchasers
and does not deal with special classes of holders, such as dealers in securities
or currencies, life insurance companies, tax-exempt organizations, persons
holding Notes as a hedge or hedged against currency risks or as part of a
straddle or conversion transaction, or persons whose functional currency is not
the U.S. dollar. The summary is based on the Internal Revenue Code of 1986, as
amended (the "Code"), its legislative history, existing and proposed Treasury
regulations thereunder, published rulings and court decisions, as currently in
effect, all of which are subject to change, possibly with retroactive effect. In
particular, the discussion of original issue discount ("OID") is based in part
on Treasury regulations under the OID and related provisions of the Code (the
"regulations"). The discussion below applies only to Notes having a term of 30
years or less; the United States federal income tax consequences of ownership of
Notes having a term in excess of 30 years will be discussed in the applicable
Pricing Supplement. In addition, any special United States tax consequences of
Indexed Notes will be discussed in the applicable Pricing Supplement.
Persons considering the purchase of Notes should consult their own tax
advisors concerning the application of the United States federal income tax laws
to their particular situations, as well as the application of state or local
laws or the laws of any other taxing jurisdiction.
United States Holders
As used herein, "United States Holder" means a beneficial owner of a
Note who or which is (i) a citizen or resident of the United States, (ii) a
corporation organized in or under the laws of the United States or any political
subdivision thereof, or (iii) a person otherwise subject to United States
federal income taxation on a net income basis in respect of a Note.
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Payments of Interest
Interest on a Note, other than interest on a discount Note (as defined
below) that is not "qualified stated interest" (as defined below) will be
taxable to a United States Holder as ordinary interest income at the time it is
accrued or is received depending on the United States Holder's method of
accounting for tax purposes.
Original Issue Discount
General. For United States federal income tax purposes, a Note, other
than a Note with a term of one year or less (a "short term note"), will be
treated as issued at an original issue discount (a "discount Note") if the
excess of its "stated redemption price at maturity" over its issue price is more
than a "de minimis amount" (as defined below). Generally, the issue price of a
Note will be the first price at which a substantial amount of Notes included in
the issue of which the Note is a part is sold. The stated redemption price at
maturity of a Note is the total of all payments provided by the Note that are
not payments of "qualified stated interest". A qualified stated interest payment
is generally any one of a series of stated interest payments on a Note that are
unconditionally payable at least annually at a single fixed rate (with certain
exceptions for lower rates paid during some periods) applied to the outstanding
principal amount of the Note. Special rules are provided for "variable rate
Notes" (as defined below).
In general, if the excess of a Note's stated redemption price at
maturity over its issue price is less than 1/4 of 1 percent of the Note's stated
redemption price at maturity multiplied by the number of complete years to its
maturity (the "de minimis amount"), then such excess, if any, constitutes "de
minimis OID", an allocable portion of which must be included in a United States
Holder's income as principal payments are made on the Note. The includible
amount with respect to each such payment will equal the product of the total
amount of the Note's de minimis OID and a fraction, the numerator of which is
the amount of the principal payment made and the denominator of which is the
stated principal amount of the Note.
Inclusion of Original Issue Discount in Income. United States Holders
(including cash basis United States Holders) of discount Notes having a maturity
of more than one year from their date of issue must include OID in income as it
accrues on a constant yield basis, generally before the receipt of cash
attributable to such income and generally in increasingly greater amounts over
the life of the Note. The amount of discount includible in income by the holder
of a discount Note is the sum of the daily portions of discount with respect to
the discount Note for each day during the taxable year or portion of the taxable
year in which it holds such Note ("accrued OID"). The daily portion is
determined by allocating to each day in any "accrual period" a pro rata portion
of the OID allocable to such accrual period.
Acquisition Premium. A United States Holder that purchases a Note for
an amount less than or equal to the sum of all amounts payable on the Note after
the purchase date other than payments of qualified stated interest but in excess
of its adjusted issue price (any such excess being "acquisition premium") and
that does not make an election to treat all interest as OID is permitted to
reduce the daily portions of OID proportionately over the life of the Note.
Market Discount. A Note, other than a short-term Note, will be treated
as purchased at a market discount (a "market discount Note") if (i) the amount
for which a United States Holder purchased the Note is less than the Note's
issue price (as determined above under "Original Issue Discount--General") and
(ii) the Note's stated redemption price at maturity or, in the case of a
discount Note, the Note's "revised issue price" exceeds the amount for which the
United States Holder purchased the Note by at least 1/4 of 1 percent of such
Note's stated redemption price at maturity or revised issue price, respectively,
multiplied by the number of complete years to the Note's maturity. If such
excess is not sufficient to cause the Note to be a market discount Note, then
such excess constitutes "de minimis market discount". The Code provides that,
for these purposes, the "revised issue price" of a Note generally equals its
issue price, increased by the amount of any OID that has accrued on the Note.
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Any gain recognized on the maturity or disposition of a market discount
Note will be treated as ordinary income to the extent that such gain does not
exceed the accrued market discount on such Note. Alternatively, a United States
Holder of a market discount Note may elect to include market discount in income
currently over the life of the Note. Such an election shall apply to all debt
instruments with market discount acquired by the electing United States Holder
on or after the first day of the first taxable year to which the election
applies. This election may not be revoked without the consent of the Internal
Revenue Service (the "Service"). A United States Holder of a market discount
Note that does not elect to include market discount in income currently
generally will be required to defer deductions for interest on borrowings
allocable to such Note in an amount not exceeding the accrued market discount on
such Note until the maturity or disposition of such Note.
Notes Subject to Contingencies Including Optional Redemption. In
general, if a Note provides for an alternative payment schedule or schedules
applicable upon the occurrence of a contingency or contingencies and the timing
and amounts of the payments that comprise each payment schedule are known as of
the issue date, the yield and maturity of the Note are determined by assuming
that the payments will be made according to the Note's stated payment schedule.
If, however, based on all the facts and circumstances as of the issue date, it
is more likely than not that the Note's stated payment schedule will not occur,
then, in general, the yield and maturity of the Note are to be computed based on
the payment schedule most likely to occur.
Notwithstanding the general rules for determining yield and maturity in
the case of Notes subject to contingencies, if Citicorp has an unconditional
option or options to redeem a Note, or the holder has an unconditional option or
options to cause a Note to be repurchased, prior to the Note's stated maturity,
then (i) in the case of an option or options of Citicorp, Citicorp will be
deemed to exercise or not exercise an option or combination or options in the
manner that minimizes the yield on the Note and (ii) in case of an option or
options of the holder, the holder will be deemed to exercise or not exercise an
option or combination of options in the manner that maximizes the yield on the
Note. For purposes of those calculations, the yield on the Note is to be
determined by using any date on which the Note may be redeemed or repurchased as
the maturity date and the amount payable on such date in accordance with the
terms of the Note as the principal amount payable at maturity.
If a contingency (including the exercise of an option) actually occurs
or does not occur contrary to an assumption made according to the above rules (a
"change in circumstances") then, solely for purposes of the accrual of OID, the
yield and maturity of the Note are to be redetermined by treating the Note as
reissued on the date of the change in circumstances for an amount equal to the
Note's adjusted issue price on that date, except to the extent that a portion of
the Note is repaid as a result of a change in circumstances.
Variable Rate Notes. In general, a Note is a "variable rate Note" if (i)
the Note's issue price does not exceed the total noncontingent principal
payments on the Note by more than a specified amount and (ii) the Note provides
for stated interest payments that are unconditionally payable at least annually
at one or more qualifying variable rates. It is expected that Floating Rate
Notes will generally qualify as variable rate Notes; the United States federal
income tax consequences of any Floating Rate Note that does not qualify as a
variable rate Note will be discussed in the applicable Pricing Supplement.
In general, if a variable rate Note provides for stated interest at a
single qualifying variable rate, all interest on the Note is qualified stated
interest and the amount of OID on the Note is calculated using the value of the
rate on the issue date (if the variable rate reflects or inversely reflects
contemporaneous variations in the cost of newly borrowed funds and meets certain
other requirements) or the yield reasonably expected for the Note (if the
variable rate is determined by reference to a single fixed formula based on
other qualifying variable rates or on the yield or value of certain types of
actively traded property). If the variable rate Note does not provide for stated
interest at a single qualifying variable rate, interest and OID accruals are
generally calculated by constructing an equivalent fixed rate Note (using for
each variable rate, depending on its type, the value of the rate as of the issue
date or a rate reflecting the expected yield on the Note). For this purpose, a
variable rate Note that provides for a fixed interest rate during any period is
treated as if it provided instead for a variable rate; the substitute variable
rate must be such that it would not, upon replacing the fixed rate, change the
fair market value of the Note.
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Short-Term Notes. In general, an individual or other cash basis United
States Holder of a short-term Note is not required to accrue OID (as
specifically defined below for the purposes of this paragraph) for United States
federal income tax purposes unless it elects to do so (but may be required to
include any stated interest in income as the interest is received). Accrual
basis United States Holders and certain other United States Holders are required
to accrue OID on short-term Notes on either a straight-line basis or under the
constant-yield method (based on daily compounding), at the election of the
United States Holder. In the case of a United States Holder not required and not
electing to include OID in income currently, any gain realized on the sale or
retirement of the short-term Note will be ordinary income to the extent of the
OID accrued on a straight-line basis (unless an election is made to accrue the
OID under the constant-yield method) through the date of sale or retirement.
United States Holders who are not required and do not elect to accrue OID on
short-term Notes will be required to defer deductions for interest on borrowings
allocable to short-term Notes in an amount not exceeding the deferred income
until the deferred income is realized. For purposes of determining the amount of
OID subject to these rules, all interest payments on a short-term Note,
including stated interest, are included in the short-term Note's stated
redemption price at maturity.
Notes Purchased at a Premium
A United States Holder that purchases a Note for an amount in excess of
its principal amount may elect to treat such excess as "amortizable bond
premium", in which case the amount required to be included in the United States
Holder's income each year with respect to interest on the Note will be reduced
by the amount of amortizable bond premium allocable (based on the Note's yield
to maturity) to such year. Any election to amortize bond premium shall apply to
all bonds (other than bonds the interest on which is excludible from gross
income) held by the United States Holder at the beginning of the first taxable
year to which the election applies or thereafter acquired by the United States
Holder, and is irrevocable without the consent of the Service.
Purchase, Sale and Retirement of Notes
A United States Holder's tax basis in a Note will be its cost, increased
by the amount of any OID or market discount previously included in the United
States Holder's income with respect to the Note and the amount, if any, of
income attributable to de minimis original issue discount or de minimis market
discount included in the United States Holder's income with respect to the Note,
and reduced by (i) the amount of any payments that are not qualified stated
interest payments, and (ii) the amount of any amortizable bond premium applied
to reduce interest on the Note. Gain or loss will be recognized upon the sale or
retirement of a Note equal to the difference between the amount realized upon
the sale or retirement and the tax basis in the Note. Except to the extent
described under "Original Issue Discount--Short-Term Notes" or "Original Issue
Discount--Market Discount", such gain or loss will be long-term capital gain or
loss if, at the time of sale or retirement, the Note has been held for more than
one year.
Backup Withholding and Information Reporting
Payments of principal (including OID, if any) and any premium and
interest made within the United States by Citicorp or any of its Paying Agents
are generally subject to information reporting and possibly to "backup
withholding" at a rate of 31%.
Payments of the proceeds from the sale of a Note to or through a broker
are generally subject to information reporting and backup withholding. However,
backup withholding will generally not apply to United States Holders other than
certain noncorporate Holders who fail to supply an accurate taxpayer
identification number or who fail to report all interest and dividend income
required to be shown on their federal income tax returns.
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PLAN OF DISTRIBUTION OF NOTES
Unless otherwise specified in the applicable Pricing Supplement, the
Agents shall be Bear, Stearns & Co. Inc., Citicorp Securities, Inc., Credit
Suisse First Boston Corporation, Donaldson, Lufkin & Jenrette Securities
Corporation, Goldman, Sachs & Co., Lehman Brothers Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Morgan Stanley & Co. Incorporated, PaineWebber
Incorporated, Salomon Brothers Inc, Smith Barney Inc. and UBS Securities LLC.
Under the terms of an amended and restated selling agent agreement dated as of
January 26, 1995, as amended, between Citicorp and the Agents named above ( the
"Selling Agent Agreement"), the Notes may be offered on a continuing basis by
Citicorp through the Agents, each of which has agreed to use reasonable best
efforts to solicit purchases of the Notes. Citicorp will pay each Agent a
commission (or grant a discount) ranging from .125% to 3.00% of the principal
amount of each Note, depending on its Stated Maturity, sold through such Agent.
Citicorp has reserved the right to sell Notes directly to investors on its own
behalf and to enter into agreements similar to the Selling Agent Agreement with
other parties. No commission will be payable nor will a discount be allowed on
any sales made directly by Citicorp. Citicorp will have the sole right to accept
offers to purchase Notes and may reject any such offer, in whole or in part.
Each Agent shall have the right, in its discretion reasonably exercised, without
notice to Citicorp, to reject any offer to purchase Notes received by it, in
whole or in part. Citicorp also may sell Notes to any Agent, acting as
principal, at a discount to be agreed upon at the time of sale, for resale to
one or more investors or other purchasers at varying prices related to
prevailing market prices at the time of such resale, as determined by such Agent
or, if so agreed, at a fixed public offering price. The Agents may sell to or
through dealers who may resell to investors. The Agents may pay all or part of
their discount or commission to such dealers. The offering price and other
selling terms for such resales may from time to time be varied by such Agent.
This Prospectus Supplement and Prospectus may be used by CSI, a wholly
owned subsidiary of Citicorp, in connection with offers and sales related to
secondary market transactions in the Notes. CSI 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 Notes will comply with the requirements of Rule 2720 of the
Conduct Rules of the National Association of Securities Dealers, Inc. (the
"NASD") regarding underwriting securities of an affiliate. No NASD member
participating in offers and sales of the Notes will execute a transaction in the
Notes in a discretionary account without the prior written specific approval of
the member's customer.
Unless otherwise indicated in the applicable Pricing Supplement, payment
of the purchase price of Notes will be required to be made in funds immediately
available in The City of New York.
The Agents may be deemed to be "underwriters" within the meaning of the
Securities Act of 1933, as amended (the "Act"), and any discounts or commissions
received by them from Citicorp and any profit realized by them on the sale or
resale of the Notes may be deemed to be underwriting discounts and commissions
under the Act. Citicorp has agreed to indemnify the Agents against and
contribute toward certain liabilities, including liabilities under the Act.
Citicorp has agreed to reimburse the Agents for certain expenses.
In addition to offering Notes through the Agents as described herein,
other medium-term notes (but constituting one or more separate series of notes
for purposes of the applicable Indenture) may in the future be offered
concurrently with the offering of the Notes, on a continuing basis in and
outside the United States by Citicorp, including, without limitation,
medium-term notes that have terms substantially similar to the terms of the
Notes offered by Citicorp on a continuing basis outside the United States
pursuant to an amended and restated selling agent agreement dated as of January
26, 1995, as amended, between Citicorp and Bear, Stearns International Limited,
Citibank International plc, Goldman Sachs International, Merrill Lynch
International, Morgan Stanley & Co. International Limited, PaineWebber
International (U.K.) Ltd.
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and Salomon Brothers International Limited, a selling agent agreement dated as
of June 6, 1995, as amended, between Citicorp and Yamaichi International
(Europe) Limited, and a selling agent agreement dated as of June 8, 1995, as
amended, between Citicorp and Sanwa International plc, as overseas agents for
Citicorp (collectively, the "Euro Selling Agent Agreements"), and directly to
investors on its own behalf. The terms of the Euro Selling Agent Agreements are
substantially similar to the terms of the Selling Agent Agreement, except that
the Euro Selling Agent Agreements contain certain selling restrictions. Any
notes sold pursuant to a Euro Selling Agent Agreement, sold by Citicorp to any
of such Euro agents for resale as contemplated by a Euro Selling Agent
Agreement, or sold by Citicorp directly to investors will, in the case of the
sale of senior notes, reduce the aggregate amount of Senior Notes which may be
offered by this Prospectus Supplement and the Prospectus, and, in the case of
the sale of subordinated notes, reduce the aggregate amount of Subordinated
Notes which may be offered by this Prospectus Supplement and the Prospectus.
The Agents each engage in transactions with and perform services for
Citicorp in the ordinary course of business.
VALIDITY OF THE NOTES
The validity of the Notes offered hereby will be passed upon for
Citicorp by Stephen E. Dietz, as an Associate General Counsel of Citibank, N.A.,
and for the Agents by Sullivan & Cromwell, 125 Broad Street, New York, New York
10004. The opinions of Mr. Dietz and Sullivan & Cromwell will be conditioned
upon, and subject to certain assumptions regarding, future action required to be
taken by Citicorp and the applicable Trustee in connection with the issuance and
sale of any particular Note, the specific terms of Notes and other matters which
may affect the validity of Notes but which cannot be ascertained on the date of
such opinions. 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.
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PROSPECTUS
[GRAPHIC OMITTED]
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,
common stock and other securities 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 May 21, 1997
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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.
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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, proxy statements and other information with the
Commission. Reports, proxy statements and other information concerning Citicorp
can be inspected and copied at prescribed rates at the Commission's Public
Reference Room, Judiciary Plaza, 450 Fifth Street, Northwest, Washington, D.C.
20549, as well as the following Regional Offices of the Commission: 7 World
Trade Center, New York, New York 10048; and Citicorp Center, 500 West Madison
Street, Chicago, Illinois 60661. Copies of such material may be obtained by mail
from the Commission's Public Reference Section at prescribed rates. If
available, such reports and other information may also be accessed through the
Commission's electronic data gathering, analysis and retrieval system ("EDGAR")
via electronic means, including the Commission's web site on the Internet
(http://www.sec.gov). Such reports, proxy statements and other information may
also 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 pursuant
to Section 13 of the Exchange Act 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,
1996;
(2)Financial review and Form 10-Q for the quarter ended March 31, 1997; and
(3) Current Reports on Form 8-K dated January 21, 1997 and April 15, 1997.
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 this Prospectus 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.
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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 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.
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 its
subsidiaries.
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RATIOS OF INCOME TO FIXED CHARGES
For the three months ended March 31, 1997 and the fiscal years ended
December 31, 1996, 1995, 1994, 1993 and 1992, Citicorp's consolidated ratios of
income to fixed charges, computed as set forth below, were as follows:
Three Months Year Ended December 31,
Ended ---------------------------------
March 31,
1997 1996 1995 1994 1993 1992
----- ---- ---- ---- ---- ----
Income to Fixed Charges:
Excluding Interest on Deposits 2.86 2.69 2.31 1.76 1.44 1.24
Including Interest on Deposits 1.49 1.48 1.42 1.31 1.18 1.09
For purposes of computing the consolidated ratio of income to fixed
charges, income represents net income, 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.
DESCRIPTION OF NOTES
General
The Senior Notes offered hereby are to be issued under an indenture
dated as of September 1, 1989, as amended (the "Senior Indenture"), between
Citicorp and United States Trust Company of New York, as trustee (the "Senior
Trustee").
The Subordinated Notes offered hereby are to be issued under an
indenture dated as of April 1, 1991, as amended (the "Subordinated Indenture"),
between Citicorp and The Chase Manhattan Bank (formerly known as Chemical Bank),
as trustee (the "Subordinated Trustee" and, together with the Senior Trustee,
the "Trustees"). As of November 27, 1992, the Subordinated Indenture as in
effect prior to that date (the "Original Subordinated Indenture") was amended by
a first supplemental indenture (the "First Supplemental 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
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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 series of
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 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
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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 in connection 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."
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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 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
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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).
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 the 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 the
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
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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 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 the 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
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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, 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
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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 as
provided 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
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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, 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 a quorum. (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 be continuing, 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
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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 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
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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.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 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
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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 payment of 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 on the date of the Subordinated Indenture or
subsequently incurred, other than (w) any securities issued under the
Subordinated Indenture (including Subordinated Notes), (x) all other unsecured
and subordinated indebtedness of Citicorp, and all other unsecured and
subordinated guarantees by Citicorp of indebtedness of other Persons, (y) all
obligations incurred or assumed by Citicorp in the ordinary course of business
in connection with the obtaining of materials or services, and all obligations
of Citicorp in respect of any guarantees of such obligations of subsidiaries of
Citicorp (provided that obligations described in this clause (y) shall not
include traveler's checks or other unsubordinated financial instruments) and (z)
any other obligations 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. (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.
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.
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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
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person described in (A) of this paragraph will not be considered an exempt
purchaser with respect to 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 of a 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
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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 national
securities exchange or otherwise.
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, in the 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 Rule 2720
of the Conduct Rules 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.
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EXPERTS
The consolidated financial statements of Citicorp and subsidiaries
included in Citicorp's Annual Report and Form 10-K for 1996 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, 1996 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."
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