PROSPECTUS SUPPLEMENT
(To Prospectus Dated August 27, 1997)
This Prospectus Supplement and Prospectus dated
August 27, 1997 cancels and replaces the Prospectus
Supplement and Prospectus each dated May 21, 1997
[CITICORP LOGO]
U.S. $7,000,000,000 Global Medium-Term Senior Notes, Series D
U.S. $2,000,000,000 Global Medium-Term Subordinated Notes, Series D
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 D (the "Senior Notes") and its Global Medium-Term
Subordinated Notes, Series D (the "Subordinated Notes" and together with the
Senior Notes, the "Notes"'). The Notes offered by this Prospectus Supplement are
offered only outside the United States and its possessions. 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 inside the United States of Citicorp's Global
Medium-Term Senior Notes, Series C. 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 inside the United States of Citicorp's
Global Medium-Term Subordinated Notes, Series C. 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 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 SUPPLEMENT, ANY PRICING SUPPLEMENT OR THE
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<TABLE>
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 International Limited, Citibank International
plc, Goldman Sachs International, Merrill Lynch International, Morgan Stanley
& Co. International Limited, PaineWebber International (U.K.) Ltd., Salomon
Brothers International Limited, Sanwa International plc and Yamaichi
International (Europe) Limited, 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 International Limited Morgan Stanley Dean Witter
Citibank International plc PaineWebber International (U.K.) Ltd.
Goldman Sachs International Salomon Brothers International Limited
Merrill Lynch International Sanwa International plc
Yamaichi International (Europe) Limited
The date of this Prospectus Supplement is August 27, 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 of such Notes
and will be set forth in a related supplement accompanying the 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.
If so provided in the applicable Pricing Supplement, Notes may be
denominated in a foreign currency or currency unit (a "Specified Currency")
designated by Citicorp ("Foreign Currency Notes"). 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.
Any purchaser of Notes offered hereby must purchase at least U.S.$50,000
aggregate principal amount of Notes at any one time or, in the case of a Foreign
Currency Note, the equivalent thereof at the Market Exchange Rate on the Trade
Date for the Note in the applicable Specified Currency.
The Notes will be redeemable prior to their Stated Maturity in the event
of certain changes involving United States taxes or the imposition of certain
information reporting requirements, as described under "Description of
Notes--Redemption and Sinking Funds" herein. The Notes may also 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--Redemption and Sinking Funds" herein.
Payments on the Notes will be made without deductions for United States
withholding taxes to the extent described under "Description of Notes--Payment
of Additional Amounts" herein.
The Notes may include Bearer Notes that are subject to United States tax
law requirements. Subject to certain exceptions, Bearer Notes may not be
offered, sold or delivered within the United States or to United States persons.
See "Limitations on Issuance of Euro-Notes" in the accompanying Prospectus.
Notes, other than Zero-Coupon Notes, purchased on original issuance by a
purchaser that is not a United States person (unless such purchaser requests a
Registered Note or Notes) will be represented initially by a temporary global
Note, representing all Notes of an Issue, to be deposited with a common
depositary for Euroclear and Cedel. Zero-Coupon Notes purchased on original
issuance by a purchaser that is not a United States person (unless such
purchaser requests a Registered Note or Notes) will be represented initially by
a permanent global Note, representing all Notes of an Issue, to be deposited
with a common depositary for Euroclear and Cedel, in the manner and upon
compliance with the procedures described under "Description of Notes--Form and
Denominations" herein. Interests in each temporary global Note will be
exchangeable for interests in a permanent global Note or for definitive
Registered Notes or Bearer Notes in the manner and upon compliance with the
procedures described under "Description of Notes--Form and Denominations"
herein, and interests in permanent global Notes will be exchangeable, upon 30
days' notice, for definitive Registered Notes or Bearer Notes. The depository
with whom a temporary global Note or a permanent global Note is deposited, and
not the owners of beneficial interests in such Notes, will be considered the
Holders thereof except in the limited circumstances specified herein.
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. 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.
Application has been made to list the Notes on the Luxembourg Stock
Exchange (the "Stock Exchange"). This Prospectus Supplement and the accompanying
Prospectus may be used for the offering, sale and listing on the Stock Exchange
of up to U.S. $7,000,000,000 aggregate principal amount of the Senior Notes and
U.S. $2,000,000,000 aggregate principal amount of the Subordinated Notes
(including, in the case of Foreign Currency Notes, the equivalent thereof in
foreign currency as described above), subject to reductions as described above.
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.
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE NOTES, INCLUDING
OVER-ALLOTMENT, STABILIZING TRANSACTIONS, SYNDICATE SHORT COVERING TRANSACTIONS
AND PENALTY BIDS. SEE "PLAN OF DISTRIBUTION OF NOTES" HEREIN.
S-2
<PAGE>
TABLE OF CONTENTS
Prospectus Supplement
Page No.
Incorporation of Certain Documents by Reference...................... S-4
Citicorp............................................................. S-5
Capitalization of Citicorp........................................... S-6
Summary Financial Data............................................... S-7
Description of Notes................................................. S-8
General............................................................ S-8
Interest.......................................................... S-9
Fixed Rate Notes.................................................. S-9
Floating Rate Notes............................................... S-10
Form and Denominations........................................... S-15
Payment and Paying Agents......................................... S-17
Transfer Agents................................................... S-18
Redemption and Sinking Funds...................................... S-18
Payment of Additional Amounts..................................... S-20
Publication of Notices............................................ S-22
Special Provisions Relating to Foreign Currency Notes................ S-22
General .......................................................... S-22
Payment........................................................... S-22
European Currency Unit............................................ S-22
Foreign Currency Risks............................................... S-24
General........................................................... S-24
Exchange Rates and Exchange Controls.............................. S-24
Judgments......................................................... S-25
United States Taxation............................................... S-25
Backup Withholding and Information Reporting...................... S-25
Plan of Distribution of Notes........................................ S-26
Validity of the Notes................................................ S-27
General Information.................................................. S-27
Management of the Citicorp........................................... S-30
Prospectus
Available Information................................................ 3
Incorporation of Certain Documents by Reference...................... 3
Citicorp............................................................. 3
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................................................. 20
Validity of Securities............................................... 21
Experts.............................................................. 21
S-3
<PAGE>
Unless otherwise indicated in the applicable Pricing Supplement, currency
amounts in this Prospectus Supplement and the accompanying Prospectus are stated
in United States dollars ("$", "dollars", "U.S. dollars" or "U.S.$").
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Securities and Exchange Commission
(the "Commission"') by Citicorp are incorporated as of their respective filing
dates in this Prospectus by reference:
(1) Annual Report and Form 10-K for the fiscal year ended December 31,
1996, filed pursuant to Section 13 of the Securities Exchange Act of 1934, as
amended (the "Exchange Act");
(2) Financial Reviews and Forms 10-Q for the quarters ended March 31, 1997
and June 30, 1997, filed pursuant to Section 13 of the Exchange Act; and
(3) Current Reports on Form 8-K, dated January 21, 1997, April 15, 1997
and July 15, 1997, filed pursuant to Section 13 of the Exchange Act.
All reports subsequently filed by Citicorp pursuant to Sections 13(a) and
(c) of the Exchange Act and 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 prior to the termination of the offering of the Notes offered
hereby shall be deemed to be incorporated by reference into the Prospectus and
this Prospectus Supplement and to be a part hereof.
This Prospectus Supplement, together with the accompanying Prospectus, may
be used for the offering, sale and listing on the Stock Exchange of up to U.S.
$7,000,000,000 aggregate principal amount of the Senior Notes and up to U.S.
$2,000,000,000 aggregate principal amount of the Subordinated Notes (including,
in the case of Foreign Currency Notes, the equivalent thereof at the Market
Exchange Rate on the applicable Trade Date in the Specified Currency), subject
to reduction as a result of the sale by Citicorp inside the United States of its
Global Medium-Term Senior Notes, Series C (in the case of the Senior Notes) and
its Global Medium-Term Subordinated Notes, Series C (in the case of the
Subordinated Notes), or by action of Citicorp's Board of Directors, provided
that no such reduction by action of the Board of Directors will affect any Note
already issued or as to which an offer to purchase has been accepted by
Citicorp. See "Description of Notes" and "Plan of Distribution of Notes" below.
Pursuant to the Euro Selling Agent Agreement (as defined herein), Citicorp will
represent to the Agents that as of the Issue Date of any Notes, neither the
Prospectus Supplement, together with the accompanying Prospectus and any Pricing
Supplement, nor any amendment or supplement thereto, will contain any untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein not misleading.
Citicorp has given an undertaking in connection with the listing of the
Notes on the Stock Exchange to the effect that, so long as any Notes remain
outstanding and listed on the Stock Exchange, in the event of any material
change in the terms and conditions of the Notes issued under Citicorp's Global
Medium-Term Notes, Series D program or any adverse change in the financial
position and operations of Citicorp which is not reflected in the Prospectus
Supplement, together with the accompanying Prospectus, as then amended or
supplemented, including any document incorporated by reference therein, Citicorp
will either prepare an amendment or supplement to the Prospectus Supplement and
the accompanying Prospectus or prepare a new Prospectus Supplement to the
accompanying Prospectus for use in connection with any subsequent offering of
Notes listed by Citicorp on the Stock Exchange.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of the Prospectus and this Prospectus Supplement to the extent that
a statement contained herein or therein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein or
therein modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of the Prospectus or this Prospectus Supplement.
This Prospectus Supplement should be read in conjunction with the
accompanying Prospectus, which document shall be deemed to be incorporated by
reference into this Prospectus Supplement and be a part hereof.
S-4
<PAGE>
Copies of Citicorp's Annual Report and Form 10-K are distributed to all
Citicorp stockholders. In addition, each person to whom a copy of this
Prospectus Supplement is delivered may obtain, without charge, a copy of any and
all of the documents listed in the first paragraph of this section, as well as
any subsequently filed documents referred to in the second paragraph herein
(other than exhibits to such documents), from:
Citicorp
399 Park Avenue
New York, NY 10043
Attention: Office of the Secretary
and from the offices of Citibank (Luxembourg) S.A., 58, Boulevard Grand-Duchesse
Charlotte, L-1330 Luxembourg.
CITICORP
Citicorp is a holding company incorporated under the laws of the State of
Delaware on December 4, 1967, whose principal subsidiary is Citibank, N.A.
("Citibank"). The principal office of Citicorp is located at 399 Park Avenue,
New York, New York 10043; its telephone number is (212) 559-1000. The address of
Citicorp's registered office in the State of Delaware is Corporation Trust
Center, 1209 Orange Street, Wilmington, Delaware.
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.
Historical financial statements and certain other information regarding
Citicorp are contained in Citicorp's Annual Report and Form 10-K for the fiscal
year ended December 31, 1996, filed by Citicorp with the Commission pursuant to
the Exchange Act. For additional information regarding Citicorp, see "Citicorp"
in the Prospectus.
S-5
<PAGE>
CAPITALIZATION OF CITICORP
The following table sets forth the consolidated capitalization of Citicorp
as of June 30, 1997, June 30, 1996, December 31, 1996, December 31, 1995 and
December 31, 1994:
<TABLE>
<CAPTION>
As of June 30, As of December 31,
1997 1996 1996 1995 1994
(Unaudited) (In Millions)
<S> <C> <C> <C> <C> <C>
Long-Term Debt................................................ $19,653 $19,477 $18,850 $18,488 $17,894
Stockholders' Equity:
Preferred Stock.............................................. $ 1,903 $2,078 $ 2,078 $ 3,071 $ 4,187
Authorized Shares: 50,000,000(A)
Issued Shares: 4,280,503 of $100 per share, 5,400,000 of
$250 per share and 250,000 of $500 per share at June 30,
1997; 4,280,503 of $100 per share, 6,100,000 of $250 per
share and 250,000 of $500 per share at June 30, 1996;
4,280,503 of $100 per share, 6,100,000 of $250 per share
and 250,000 of $500 per share at December 31, 1996;
4,280,503 of $100 per share, 6,100,000 of $250 per share,
250,000 of $500 per share and 9,929 of $100,000 per share
at December 31, 1995; and 4,280,503 of $100 per share,
5,000,000 of $25 per share, 12,500 of $100,000 per share,
5,000,000 of $250 per share and 6,408,334 of $177 per share
at December 31, 1994
Common Stock ($1.00 par value)............................... 506 505 506 461 421
Authorized Shares: 800,000,000 in each period
Issued Shares: 506,298,235 at June 30, 1997;
505,199,048 at June 30, 1996; 506,298,235 at
December 31, 1996; 461,319,265 at December 31,
1995; and 420,589,459 at December 31, 1994
Surplus...................................................... 6,557 6,518 6,595 5,702 4,194
Retained Earnings............................................ 15,766 12,882 14,303 12,190 9,561
Net Unrealized Gains--Securities Available
for Sale (B)............................................... 952 297 676 132 278
Foreign Currency Translation................................. (547) (469) (486) (437) (471)
Common Stock in Treasury, at cost............................ (3,728) (1,881) (2,950) (1,538) (401)
Shares: 48,206,545 at June 30, 1997;
32,035,374 at June 30, 1996; 43,081,217 at
December 31, 1996; 34,030,205 at
December 31, 1995; and 25,508,610 at
December 31, 1994
Total Stockholders' Equity................................ $21,409 $19,930 $20,722 $19,581 $17,769
Total......................................................... $41,062 $39,407 $39,572 $38,069 $35,663
</TABLE>
(A) Issuable as either redeemable or non-redeemable. At December 31, 1995 and
December 31, 1994, 80,000 and 170,000, respectively, shares of redeemable
preferred stock were issued and outstanding amounting to $8 million and
$17 million, respectively, included in Long-Term Debt. Such amounts were
redeemed in 1996.
(B) Effective January 1, 1994, Citicorp adopted SFAS No. 115, "Accounting for
Certain Investments in Debt and Equity Securities."
There has been no material change to the capitalization of Citicorp since
June 30, 1997. Purchased funds and other borrowings, which include commercial
paper and other borrowings with original maturities of less than one year,
amounted to $24,138 million at June 30, 1997, $17,519 million at June 30, 1996,
$18,191 million at December 31, 1996, $16,334 million at December 31, 1995, and
$20,907 million at December 31, 1994.
S-6
<PAGE>
SUMMARY FINANCIAL DATA
The following table sets forth, in summary form, certain financial data
for each of the years in the three year period ended December 31, 1996 and for
the six months ended June 30, 1997 and June 30, 1996. This summary is qualified
in its entirety by the detailed information and financial statements included in
the documents incorporated by reference; this summary is not covered by the
Report of Independent Auditors incorporated herein by reference. See
"Incorporation of Certain Documents by Reference" in this Prospectus Supplement.
The consolidated financial data at and for the six months ended June 30, 1997
and June 30, 1996 is derived from unaudited financial statements. The results
for the six months ended June 30, 1997 are not necessarily indicative of the
results for the full year or any other interim period.
<TABLE>
<CAPTION>
Six Months
Ended June 30, Year Ended December 31,
1997 1996 1996 1995 1994
(In Millions, Except Per Share Amounts)
<S> <C> <C> <C> <C> <C>
Consolidated Summary of Financial Results
Net Interest Revenue ...................... $ 5,667 $ 5,413 $ 10,940 $ 9,951 $ 8,911
Fees, Commissions and Other Revenue ....... 4,840 4,408 9,256 8,727 7,837
Total Revenue ............................ $ 10,507 $ 9,821 $ 20,196 $ 18,678 $ 16,748
Provision for Credit Losses ............... 935 973 1,926 1,991 1,881
Operating Expense ......................... 6,342 5,838 12,197 11,102 10,256
Income Before Taxes and
Cumulative Effects of Accounting Changes . $ 3,230 $ 3,010 $ 6,073 $ 5,585 $ 4,611
Income Taxes .............................. 1,211 1,144 2,285 2,121 1,189
Income Before Cumulative
Effects of Accounting Changes ............ $ 2,019 $ 1,866 $ 3,788 $ 3,464 $ 3,422
Cumulative Effects of Accounting Changes(A) -- -- -- -- (56)
Net Income ................................ $ 2,019 $ 1,866 $ 3,788 $ 3,464 $ 3,366
Income Applicable to Common Stock ......... $ 1,947 $ 1,785 $ 3,631 $ 3,126 $ 3,010
Dividends Declared Per Common Share ....... 1.05 .90 1.80 1.20 .45
Earnings Per Share (B)
On Common and Common Equivalent Shares
Income Before Cumulative
Effects of Accounting Changes ............. $ 4.11 $ 3.68 $ 7.50 $ 7.21 $ 7.15
Cumulative Effects of Accounting Changes(A) -- -- -- -- (.12)
Net Income ................................ $ 4.11 $ 3.68 $ 7.50 $ 7.21 $ 7.03
Assuming Full Dilution
Income Before Cumulative
Effects of Accounting Changes ............ $ 4.11 $ 3.61 $ 7.42 $ 6.48 $ 6.40
Cumulative Effects of Accounting Changes(A) -- -- -- -- (.11)
Net Income ................................ $ 4.11 $ 3.61 $ 7.42 $ 6.48 $ 6.29
Period End Balances (In Billions)
Total Loans, Net of Unearned Income and
Allowance for Credit Losses ............. $ 173.1 $ 162.4 $ 169.1 $ 160.3 $ 147.3
Total Assets(C) ........................... 304.3 266.8 281.0 256.9 250.5
Total Deposits ............................ 198.7 175.8 185.0 167.1 155.7
Debt(D) ................................... 19.7 19.5 18.9 18.5 17.9
Total Stockholders' Equity(E) ............. 21.4 19.9 20.7 19.6 17.8
</TABLE>
(A) Refers to the adoption of SFAS No. 112, "Employers' Accounting for
Postemployment Benefits", effective January 1, 1994.
(B) Based on net income after deducting preferred stock dividends, except
where conversion is assumed, and, unless anti-dilutive, the after-tax
dividend equivalents on shares issuable under Citicorp's Executive
Incentive Compensation Plan.
(C) Reflects the adoption of FASB Interpretation No. 39, "Offsetting of
Amounts Related to Certain Contracts", effective January 1, 1994.
(D) Includes long-term debt, subordinated capital notes and redeemable
preferred stock.
(E) Reflects the adoption of SFAS No. 115, "Accounting for Certain Investments
in Debt and Equity Securities", effective January 1, 1994.
S-7
<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 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"). As of the date of this Prospectus Supplement, the principal
office of the Senior Trustee is located at 114 West 47th Street, New York, New
York 10036. 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"). As of the date of this Prospectus Supplement, the
principal office of the Subordinated Trustee is located at 450 West 33rd Street,
New York, New York 10001. 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 U.S. $2,000,000,000 in the case of the Subordinated
Notes (including, in the case of Foreign Currency Notes, the equivalent thereof
at the Market Exchange Rate on the applicable Trade Date in the Specified
Currency), subject to reduction as a result of the sale by Citicorp inside the
United States of its Global Medium-Term Senior Notes, Series C (in the case of
the Senior Notes) and its Global Medium-Term Subordinated Notes, Series C (in
the case of the Subordinated Notes), or by or pursuant to action of Citicorp's
Board of Directors, provided that no such reduction by action of Citicorp's
Board of Directors 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, provided that
Citicorp will prepare a new Prospectus Supplement or Pricing Supplement in
connection with such an increase.
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 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.
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. 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 of principal or interest payable if the specified index is no longer
calculated or published. See "Foreign Currency Risks" below.
S-8
<PAGE>
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 the Notes will be made in U.S. dollars in the manner described
in this Prospectus Supplement and the accompanying Prospectus under the caption
"Description of Notes--Payment and Paying Agents." If any of the Notes are to be
denominated in a Specified Currency, additional information pertaining to the
terms of such Notes and other matters of interest to the Holders thereof will be
described in the applicable Pricing Supplement. See "Special Provisions Relating
to Foreign Currency Notes", "Foreign Currency Risks" and "United States
Taxation" below and "Foreign Currency Risks" in the accompanying Prospectus.
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--Assumption of Obligations" and "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 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. 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").
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.
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 that are Registered
Notes will be the February 1 or August 1, as the case may be, next preceding
such Interest Payment
S-9
<PAGE>
Dates. 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 any Fixed Rate Note is not
a Business Day at any Place of Payment (as defined under "Payment and Paying
Agents" below), then payments due need not be made at such Place of Payment on
such date, but may be made on the next succeeding Business Day at such Place of
Payment with the same force and effect as if made on the date such payments were
due and no interest shall accrue on the amount 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 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, (b) with respect to LIBOR Notes only, any day on which dealings
in deposits in U.S. dollars are transacted in the London interbank market, (c)
with respect to Foreign Currency Notes, other than such Notes denominated in
ECUs (as defined under "Special Provisions Relating to Foreign Currency
Notes--European Currency Unit" herein) only, any day that, in the principal
financial center of the country of the Specified Currency, is not a day on which
banking institutions generally are authorized or obligated by law to close, and
(d) with respect to Foreign Currency Notes denominated in ECUs only, any day
that is designated as an ECU settlement day by the ECU Banking Association in
Paris or otherwise generally regarded in the ECU interbank market as a day on
which payments in ECUs may be made.
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
S-10
<PAGE>
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 Date" means with respect to any Note, the date, 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 that are Registered Notes shall be the date
15 calendar days prior to each Interest Payment Date, whether or not such date
shall be a Market Day.
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 of any such Note is payable, will include
interest accrued to and including, in the case of Registered Notes, the Regular
Record Date or, in the case of Bearer Notes, the fourteenth calendar day, in
each case next preceding such Interest Payment Date.
Accrued interest on any Floating Rate Note from its Issue Date or from the
last date to which interest has been paid or payment thereof has duly been made
available 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 payment thereof has duly been
made available for 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).
With respect to any Issue of Floating Rate Notes listed on the Stock
Exchange, the Calculation Agent will provide 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 to the Stock Exchange
no later than the first Market Day of the related Interest Period, and to the
Holder of a Floating Rate Note upon request. The interest rate then in effect on
any Floating Rate Note will also be available upon request of the Holder thereof
from the office of Citibank (Luxembourg) S.A. and, as long as such Floating Rate
Notes are listed on the Stock Exchange, will be published in the Luxembourg Wort
promptly after determination thereof. 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
S-11
<PAGE>
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.
"Money Market Yield" shall be a yield (expressed as a percentage)
calculated in accordance with the following formula:
Money Market Yield = D x 360 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 3:30 P.M.
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 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 Page 3750" means the display page so
designated on the Dow Jones Telerate Service (or such other page or pages
as may replace such page on the system for the purpose of displaying
London interbank offered rates of major banks). 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 Page 3750 shall be as specified
in the applicable Pricing Supplement. If neither Reuters Screen LIBO or
Telerate Page 3750 is specified in the applicable
S-12
<PAGE>
Pricing Supplement, LIBOR will be determined as if Telerate Page 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 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
LIBOR 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
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 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 3:00 P.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 nor 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
3:00 P.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) 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 $5,000,000;
provided, however, that if the dealers selected as aforesaid by the Calculation
S-13
<PAGE>
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
3:00 P.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) 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 for the last transaction in overnight United States
dollar federal funds arranged by three leading brokers of federal funds
transactions in The City of New York (which may include the Agents or their
affiliates) selected by the Calculation Agent prior to 9:00 A.M., New York City
time, on such Interest Determination Date; 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 3:00 P.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 USPRIME1 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
USPRIME1 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
USPRIME1 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 USPRIME1 Page"
means the display designated as page "USPRIME1" on the Reuters Monitor Money
Rates Service (or such other page as may replace the USPRIME1 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.
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).
S-14
<PAGE>
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 with respect to such Interest Reset 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 offer side 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 offer side 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 CMT 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.
Form and Denominations
The Notes will be issuable in bearer form ("Bearer Notes"), with coupons
attached, except for Zero-Coupon Notes, and in registered form ("Registered
Notes"), without coupons. Unless otherwise specified in the applicable Pricing
Supplement, Bearer Notes and Registered Notes, in each case other than Foreign
Currency Notes, will be issuable in denominations of U.S. $50,000 and any
integral multiple of U.S. $1,000 in excess thereof. With respect to
denominations of Foreign Currency Notes, see "Special Provisions Relating to
Foreign Currency Notes" below. The Notes will be subject to a minimum purchase
requirement, as described on page S-2 of this Prospectus Supplement.
All Notes purchased on original issuance by or on behalf of a United
States person (as defined below), other than a Qualifying Foreign Branch of a
U.S. Financial Institution (as defined below), will be issued only in fully
registered form and will be delivered to such purchaser, in any authorized
denomination, in a minimum aggregate principal amount of U.S. $50,000 (or, in
the case of a Foreign Currency Note, the equivalent thereof at the Market
Exchange Rate on the Trade Date for the Note in the Specified Currency), on the
settlement date for the purchase of such Notes. In addition, Registered Notes,
in any authorized denomination and in a minimum aggregate principal amount of
U.S. $50,000 (or, in the case of a Foreign Currency Note, the equivalent thereof
at the Market Exchange Rate on the Trade Date for the Note in the Specified
Currency), will be delivered on the settlement date for the purchase of such
Notes to any other purchaser who so requests at the time of offering to purchase
such Notes and provides the information necessary to issue Registered Notes. Any
Notes purchased by or on behalf of a United States person which is a Qualifying
Foreign Branch of a U.S. Financial Institution will not be required to be
delivered to such purchaser in fully registered form on the settlement date for
such Notes if, at the time of offering to purchase such Notes, such purchaser
S-15
<PAGE>
orally represents to the soliciting Agent that it is a Qualifying Foreign Branch
of a U.S. Financial Institution and orally agrees with such Agent that it will
provide the required certification described below. "United States" means the
United States of America (including the States and the District of Columbia).
"United States person" means a citizen or resident of the United States, any
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. "Qualifying
Foreign Branch of a U.S. Financial Institution" means a branch of a United
States financial institution (as defined in Treasury Regulations Section
1.165-12(c)(1)(v)) located outside the United States that has agreed to comply
with the requirements of Section 165(j)(3)(A), (B) or (C) of the United States
Internal Revenue Code of 1986, as amended from time to time, and the regulations
thereunder (the "Code").
Except as provided in the preceding paragraph, all Notes, other than
Zero-Coupon Notes, of the same Issue, will be represented initially by a
temporary global Note, without interest coupons, which will be deposited with a
common depositary in London for Euroclear and Cedel for the accounts of the
subscribers of the Notes on the related settlement date. Upon deposit of each
temporary global Note, Euroclear or Cedel, as the case may be, will credit each
subscriber with a principal amount of Notes equal to the principal amount
thereof for which it has subscribed and paid, which in any event shall not be
less than U.S. $50,000 (or, in the case of a Foreign Currency Note, the
equivalent thereof at the Market Exchange Rate on the Trade Date for the Note in
the Specified Currency). For any issue of Notes, the interests of the beneficial
owner or owners in a temporary global Note of such Issue will be exchangeable,
at the option of the beneficial owner or owners of interests in such temporary
global Note, commencing 45 days after the Issue Date for the Notes represented
thereby for either definitive Registered Notes or definitive Bearer Notes
representing in the aggregate all the Notes of the same Issue, in each case of
like tenor and of an equal aggregate principal amount and in any authorized
denomination (provided that in either case notice of exercise of such option is
given to the Security Registrar through Euroclear or Cedel on the related
settlement date), or, if specified in the applicable Pricing Supplement, for
interests in a permanent global Note, without interest coupons, representing in
the aggregate all the Notes of the same Issue, each such permanent global Note
representing an equal aggregate principal amount of Notes of the same Issue. An
exchange of interest in a temporary global Note for definitive Bearer Notes or
an interest in a permanent global Note will be made only upon written
certification, in the form required by the applicable Indenture, that (a) such
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
Note is owned by a United States person (other than a financial institution for
purposes of resale during the restricted period) who is (i) a foreign branch of
a United States financial institution or (ii) a United States person who
acquired such Note through the foreign branch of a United States financial
institution and who for purposes of this certification holds such Note through
such financial institution on the date of certification and, in either case,
such United States financial institution provides a certificate stating that it
agrees to comply with the requirements of Section 165(j)(3)(A), (B) or (C) of
the Code; or (c) such Note is owned by a financial institution for purposes of
resale and such financial institution certifies that it has not acquired such
Note for purposes of resale (during the restricted period) directly or
indirectly to a United States person or to a person within the United States or
its possessions. See "Description of Notes--Temporary Global Notes" and
"Limitations on Issuance of Euro-Notes" in the accompanying Prospectus.
If an Issue of Notes represented by a temporary global Note is
exchangeable only for a permanent global Note, the interests of the beneficial
owners in the temporary global Note representing all the Notes of such Issue
will be exchangeable, commencing 45 days after the Issue Date thereof, only for
interests in a permanent global Note, without interest coupons, representing the
aggregate principal amount of Notes of such Issue (each, a "Permanent Global
Note").
A beneficial owner of an interest in a Permanent Global Note may elect,
upon not less than 60 days written notice to the London office of the Security
Registrar and the London office of the Common Depositary given through Morgan
Guaranty Trust Company of New York, Brussels office, as operator of Euroclear
and Cedel, to exchange its interest in such Permanent Global Note for one or
more definitive Bearer Notes or definitive Registered Notes, in each case of
like tenor and of an equal aggregate principal amount and in any authorized
denomination. In the event that any beneficial owner of an interest in a
Permanent Global Note elects to exchange its interest therein for Notes in
definitive form, such beneficial owner's interest in such Permanent Global Note
will be exchanged for Notes in the definitive form selected by such beneficial
owner and the balance, if any, of the interests in such Permanent Global Note
will be exchanged in full only for Notes in definitive bearer form.
Upon expiration of the applicable 60 day notice period, the Common
Depositary shall surrender the related Permanent Global Note to the Security
Registrar in exchange for one or more definitive Bearer Notes, definitive
Registered Notes or a combination thereof, as the case may be, in an aggregate
principal amount equal to that of the surrendered Permanent Global Note.
Subsequent to an exchange of a Permanent Global Note for Notes in definitive
form, owners of interests in such Permanent
S-16
<PAGE>
Global Note may obtain Notes evidencing such owner's interest therein, in each
case of like tenor and of an equal aggregate principal amount and in any
authorized denomination, from Euroclear or Cedel.
If an Issue of Notes represented by a temporary global Note is
exchangeable only for Notes in definitive form, the interests of the beneficial
owners in such temporary global Note will be exchangeable, commencing 45 days
after the date of issuance thereof, for one or more definitive Registered Notes,
definitive Bearer Notes, or a combination thereof, in each case, of like tenor
and in an aggregate principal amount equal to that of the temporary global Note
to be exchanged and in any authorized denomination, provided that each such
owner of a beneficial interest in such temporary global Note provides written
notice of its election to receive such definitive Registered Notes or definitive
Bearer Notes, or a combination thereof, as the case may be, to the London office
of the Security Registrar and the London office of the Common Depositary given
through Euroclear or Cedel on or before the related Issue Date. In the absence
of any such written request, Citicorp may elect, at its option, to exchange any
such interest in such temporary global Note for one or more definitive
Registered Notes or definitive Bearer Notes.
An exchange of an interest in a temporary global Note for an interest in a
permanent global Note or for definitive Bearer Notes will be made only upon
written certification in the form required under the applicable Indenture as
described under "Description of Notes--Form and Denominations" in the
accompanying Prospectus.
Except as provided in the seventh preceding paragraph, all Zero-Coupon
Notes of the same Issue will be represented initially by a permanent global
Note, without interest coupons, which will be deposited with a common depositary
in London for Euroclear and Cedel for the accounts of the subscribers of the
Notes on the related settlement date, but only upon written certification, in
the form required by the applicable Indenture, as described in the sixth
preceding paragraph. Upon deposit of each such permanent global Note, Euroclear
or Cedel, as the case may be, will credit each subscriber with a principal
amount of Notes equal to the principal amount thereof for which it has
subscribed and paid, which in any event shall not be less than U.S. $50,000 (or,
in the case of a Foreign Currency Note, the equivalent thereof at the Market
Exchange Rate on the Trade Date for the Note in the Specified Currency).
A beneficial owner having an interest in a temporary global Note must
exchange its share of such temporary global Note for definitive Notes or an
interest in a permanent global Note before interest can be collected, except as
described under "Payment and Paying Agents" below.
The depositary with whom a temporary global Note or a permanent global
Note is deposited, and not the owners of beneficial interests therein, will be
considered the Holders thereof under the applicable Indenture.
Payment and Paying Agents
Each temporary global Note will provide that interest on any portion
thereof payable on an Interest Payment Date prior to the issuance of definitive
Notes or of a permanent global Note will be paid to the common depositary for
each of Euroclear and Cedel, as bearer of such Note, with respect to the portion
of such temporary global Note held for its account. Each of Euroclear and Cedel
will undertake in such circumstances to credit such interest received by it in
respect of a temporary global Note to the respective accounts of the Persons who
are the beneficial owners of such temporary global Note on such Interest Payment
Date, but only upon receipt in each case of written certification to the effect
described under "Description of Notes--Temporary Global Notes" in the
accompanying Prospectus. Any interest so received by Euroclear and Cedel and not
so paid shall be returned to the Trustee or the applicable Paying Agent
immediately prior to the expiration of two years after such Interest Payment
Date in order to be repaid to Citicorp. If such Interest Payment Date occurs on
or after the Exchange Date, an exchange for a permanent global Note will be
effected on such Interest Payment Date of the portion of the temporary global
Note relating to such certification, in the absence of specific instructions to
the contrary.
Each permanent global Note will provide that principal represented thereby
and any premium and interest in respect thereof payable on any Interest Payment
Date or at Maturity will be paid to the common depositary for each of Euroclear
and Cedel, as bearer of such Note, with respect to that portion of such
permanent global Note held for its account. Each of Euroclear and Cedel will
undertake in such circumstances to credit such principal, premium and interest
received by it in respect of a permanent global Note to the respective accounts
of the Persons who are the beneficial owners of such permanent global Note on
such Interest Payment Date or at Maturity, as the case may be. If a Registered
Note is issued in exchange for any portion of a permanent global Note after the
close of business at the office or agency where such exchange occurs on any
Regular Record Date or on any Special Record Date, as the case may be, interest
or Defaulted Interest, as the case may be, will be payable on
S-17
<PAGE>
such Interest Payment Date or proposed date for payment, as the case may be, in
respect of such Registered Note, only to Euroclear and Cedel, and Euroclear and
Cedel will undertake in such circumstances to credit such interest to the
account of the Person who was the beneficial owner of such portion of such
permanent global Note on such Regular Record Date or Special Record Date, as the
case may be. Payment of principal and any premium and interest payable at
Maturity in respect of any permanent global Note will be made to the common
depositary for Euroclear and Cedel, as bearer of such Note, in immediately
available funds.
Except as set forth above, interest on definitive Bearer Notes will be
paid to the bearer of the coupon for a particular Interest Payment Date upon
presentation of the applicable coupon and at Maturity upon surrender of the
definitive Bearer Note to a Paying Agent located, except as otherwise provided
under "Description of Notes--Payment and Paying Agents" in the accompanying
Prospectus, outside the United States and its possessions. Payment of interest
(other than interest payable at Maturity) on Bearer Notes denominated in U.S.
dollars will be made by check or, if requested in writing by the bearer of the
coupon, by transfer to an account maintained by the payee with a financial
institution located outside the United States and its possessions.
Interest on Registered Notes will be payable generally to the Person in
whose name such 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 Registered Note
originally issued between a Regular Record Date and an Interest Payment Date
will be made on the second Interest Payment Date following the date of original
issuance of such Note to the registered owner on the Regular Record Date
immediately preceding such Interest Payment Date. Payment of interest (other
than interest payable at Maturity) on Registered Notes denominated in U.S.
dollars will be made by check mailed to the address of the Person entitled
thereto as it appears in the Security Register.
Payments of principal of and any premium and interest payable at Maturity
on definitive Registered Notes denominated in U.S. dollars will be made in
immediately available funds at the office of any Paying Agent, and payments of
principal of and any premium and interest payable at Maturity on definitive
Bearer Notes denominated in U.S. dollars will be made in immediately available
funds at the office of any Paying Agent located, except as otherwise provided
under "Description of Notes--Payment and Paying Agents" in the accompanying
Prospectus, outside the United States and its possessions, provided that in each
case the Note is presented to such Paying Agent in time for such Paying Agent to
make such payments in such funds in accordance with its normal procedures.
With respect to payments on Foreign Currency Notes, see "Special
Provisions Relating to Foreign Currency Notes--Payment" and "Special Provisions
Relating to Foreign Currency Notes--European Currency Unit" herein.
Citicorp has initially designated Citibank, acting through its principal
office in London, England, and Citibank (Luxembourg) S.A., acting through its
principal office in Luxembourg, as its Paying Agents for the Notes outside the
United States, and Citibank, acting through its principal corporate trust
office, as its Paying Agent for the Notes in the Borough of Manhattan, The City
of New York (each such location a "Place of Payment"). So long as any of the
Notes are listed on the Stock Exchange, Citicorp will maintain a Paying Agent in
Luxembourg for such Notes. See "Description of Notes--Payment and Paying Agents"
in the accompanying Prospectus.
Transfer Agents
Citicorp has initially designated Citibank, acting through its principal
corporate trust office, as its transfer agent for the Notes in the Borough of
Manhattan, The City of New York, and Citibank, acting through its principal
office in London, England, as its transfer agent for the Notes outside the
United States. So long as any of the Notes are listed on the Stock Exchange,
Citibank (Luxembourg) S.A., acting through its principal office in Luxembourg,
will act as a transfer agent for such Notes. See "Description of Notes--Form,
Exchange, Registration and Transfer" in the accompanying Prospectus.
Redemption and Sinking Funds
The Notes will be redeemable prior to their Stated Maturity in the event
of certain changes involving United States taxes or the imposition of certain
information reporting requirements, as described below. The provisions described
in the accompanying Prospectus under "Description of Notes--Assumption of
Obligations" will apply to the Notes in the event of any
S-18
<PAGE>
such change or imposition. In addition, the applicable Pricing Supplement will
indicate either that a Note cannot otherwise be redeemed prior to its Stated
Maturity or that a Note will also 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.
Any Issue of Notes may be redeemed, as a whole but not in part, at the
option of Citicorp, upon not less than 30 nor more than 60 days' prior notice as
described under "Description of Notes--Notices" in the accompanying Prospectus
(which notice shall be irrevocable), at a Redemption Price equal to, in the case
of an Issue of Notes other than Original Issue Discount Notes and Indexed Notes,
100% of their principal amount, or, in the case of an Issue of Original Issue
Discount Notes and Indexed Notes, the amount specified in or calculated in
accordance with the terms of such Notes, together with any interest accrued to
the date fixed for redemption, if, as a result of any amendment to, or change
in, the laws (or any regulations or rulings promulgated thereunder) of the
United States or any political subdivision or taxing authority thereof or
therein affecting taxation, or any amendment to or change in an official
position regarding the application or interpretation of such laws, regulations
or rulings, which amendment or change is effective on or after the date hereof,
Citicorp will become obligated to pay additional amounts (as described under
"Payment of Additional Amounts" below) on, in the case of an Issue of Notes
other than Zero-Coupon Notes, the next succeeding Interest Payment Date, or, in
the case of Zero-Coupon Notes, at Maturity or upon the sale or exchange of any
such Note, provided that such obligation to pay additional amounts cannot be
avoided by the use of reasonable measures available to Citicorp; provided,
however, that in the opinion of Citicorp, which opinion shall be rendered in
good faith, such measures need not be used if they have or will have a material
adverse impact on the conduct of its business; and provided further, however,
that (a) no such notice of redemption may be given earlier than 90 days prior to
the earliest date on which Citicorp would be obligated to pay such additional
amounts were a payment in respect of an Issue of Notes, other than Zero-Coupon
Notes, then due, or, in the case of Zero-Coupon Notes, were a payment in respect
of such Notes then due or were a sale or exchange of any such Note then made,
and (b) at the time such notice of redemption is given, such obligation to pay
such additional amounts remains in effect. Immediately prior to the giving of
any notice of redemption pursuant to this paragraph, Citicorp shall deliver to
the Trustee a certificate stating that Citicorp is entitled to effect such
redemption and setting forth a statement of facts showing that the conditions
precedent to the right of Citicorp so to redeem have occurred and an opinion of
the Corporate Tax Division of Citicorp to such effect based on such statement of
facts.
In addition, if Citicorp determines that any payment made outside the
United States by Citicorp or any of its Paying Agents of the full amount of
principal or any premium or interest due with respect to any Bearer Note or
coupon would, under any present or future laws or regulations of the United
States affecting taxation or otherwise, be subject to any certification,
information, documentation or other reporting requirement of any kind, the
effect of which requirement is the disclosure to Citicorp, any Paying Agent or
any governmental authority of the nationality, residence or identity of a
beneficial owner of such Bearer Note or coupon who is a United States Alien (as
defined below under "Payment of Additional Amounts") (other than such a
requirement (a) which would not be applicable to a payment made by Citicorp or
any one of its Paying Agents (i) directly to the beneficial owner or (ii) to any
custodian, nominee or other agent of the beneficial owner, or (b) which can be
satisfied by the custodian, nominee or other agent certifying that the
beneficial owner is a United States Alien, provided, in each case referred to in
clauses (a)(ii) and (b) that payment by such custodian, nominee or other agent
of such beneficial owner is not otherwise subject to any such requirement or (c)
would not be applicable to a payment made to any other Paying Agent in Western
Europe), Citicorp at its election will either (x)(i) redeem an Issue of Notes
(other than Zero-Coupon Notes), as a whole but not in part, upon not less than
30 nor more than 60 days' prior notice as described under "Description of
Notes--Notices" in the accompanying Prospectus, at a Redemption Price equal to,
in the case of an Issue of Notes other than Original Issue Discount Notes and
Indexed Notes, 100% of their principal amount, or, in the case of Original Issue
Discount Notes and Indexed Notes, the amount specified in or calculated in
accordance with the terms of such Notes, together with interest accrued to the
date fixed for redemption, or (ii) permit any Holders of an Issue of Zero-Coupon
Notes to present such Notes for redemption within 90 days of notice of such
redemption for the amount specified in the terms of such Notes, provided that if
any such Holder fails to present its Note for redemption, such Holder will not
be entitled to any additional amounts, or (y) if and so long as the conditions
of the third paragraph under "Payment of Additional Amounts" below are
satisfied, pay the additional amounts specified in such paragraph. Citicorp will
make such determination and election and notify the Trustee thereof as soon as
practicable, and the Trustee will promptly give notice of such determination in
the manner described under "Description of Notes--Notices" in the accompanying
Prospectus (the "Determination Notice"), in each case stating the effective date
of such certification, information,
S-19
<PAGE>
documentation or other reporting requirement, whether Citicorp will redeem the
relevant Notes or will pay the additional amounts specified in such paragraph
and (if applicable) the last date by which the redemption of the relevant Notes
must take place. If Citicorp elects to redeem the relevant Notes pursuant to
clause (x)(i) above, such redemption shall take place on such date, not later
than one year after publication of the Determination Notice, as Citicorp elects
by notice to the Trustee at least 75 days before such date, unless shorter
notice is acceptable to the Trustee. Upon receipt of notice from Citicorp of the
redemption date, the Trustee shall cause notice of such date to be given as
provided under "Description of Notes--Notices" in the accompanying Prospectus.
If Citicorp elects to permit redemption of the relevant Notes pursuant to clause
(x)(ii) above, notice of the redemption will be given not more than 268 days
following the Determination Notice and will specify the date fixed for
redemption, and the relevant Notes will be redeemed on the day 97 days after
notice of the redemption has been given. Notwithstanding the foregoing, Citicorp
will not so redeem the relevant Notes or permit redemption of the relevant
Notes, as the case may be, if Citicorp subsequently determines, not less than 30
days prior to the date fixed for redemption, that subsequent payments on such
Notes would not be subject to any such requirement, in which case Citicorp will
promptly notify the Trustee, which will promptly give notice of that
determination in the manner described under "Description of Notes--Notices" in
the accompanying Prospectus, and any earlier redemption notice will thereupon be
revoked and of no further effect. If Citicorp elects as provided in clause (y)
above to pay additional amounts, and as long as Citicorp is obligated to pay
such additional amounts, Citicorp may subsequently redeem the relevant Notes
(other than Zero-Coupon Notes) at any time, as a whole but not in part, upon not
less than 30 nor more than 60 days' prior notice given in the manner described
under "Description of Notes--Notices" in the accompanying Prospectus, at a
Redemption Price equal to 100% of their principal amount, or, in the case of
Original Issue Discount Notes (other than Zero-Coupon Notes) and Indexed Notes,
the amount specified in or calculated in accordance with the terms of such
Notes, together with interest accrued to the date fixed for redemption,
including any additional amounts required to be paid but without reduction for
applicable United States withholding taxes.
Payment of Additional Amounts
Citicorp will pay to the Holder of any Note or any coupon appertaining
thereto who is a United States Alien (as defined below) such additional amounts
as may be necessary in order that, in the case of a Note other than a
Zero-Coupon Note, every net payment of the principal of and any premium and
interest on such Note or, in the case of a Zero-Coupon Note, (i) the net payment
of principal of and interest on overdue principal, if any, on such Note and (ii)
the net proceeds from the sale or exchange of such Note, to the extent of the
issue price plus accrued but unpaid original issue discount, after deduction or
withholding for or on account of any present or future tax, assessment or other
governmental charge imposed by the United States or any political subdivision or
taxing authority thereof or therein upon or as a result of such payment or as a
result of such sale or exchange, as the case may be, will not be less than the
amount provided for in such Note or in such coupon to be then due and payable,
or, in the case of a sale or exchange, the amount of the net proceeds from the
sale or exchange before any such tax, assessment or other governmental charge;
provided, however, that Citicorp shall not be required to make any payment of
additional amounts for or on account of:
(a) any tax, assessment or other governmental charge which would not have
been imposed but for (i) the existence of any present or former connection
between such Holder (or between a fiduciary, settlor, beneficiary, member or
shareholder of, or possessor of a power over, such Holder, if such Holder is an
estate, trust, partnership or corporation) and the United States, including,
without limitation, such Holder (or such fiduciary, settlor, beneficiary,
member, shareholder or possessor) being or having been a citizen or resident
thereof or being or having been present or engaged in trade or business therein
or having or having had a permanent establishment therein or (ii) the
presentation by a Holder of a Note or any coupon appertaining thereto for
payment on a date more than 10 days after the date on which such payment became
due and payable or the date on which payment thereof is duly provided for,
whichever occurs later;
(b) any estate, inheritance, gift, sales, transfer, personal property tax
or similar tax, assessment or other governmental charge;
(c) any tax, assessment or other governmental charge imposed by reason of
(i) such Holder's past or present status as a personal holding company, a
foreign personal holding company, a passive foreign investment company with
respect to the United States or a corporation which accumulates earnings to
avoid United States federal income tax; or (ii) any Note or coupon (or portion
thereof) being considered to be an extension of credit made by a bank pursuant
to a loan agreement entered into in the ordinary course of the bank's trade or
business;
(d) any tax, assessment or other governmental charge which is payable
otherwise than by withholding from payments of principal of, or any premium or
interest (including interest on overdue principal, if any) on, the Notes, other
than
S-20
<PAGE>
Zero-Coupon Notes or, in the case of Zero-Coupon Notes, from payments of
principal of or any premium or interest on overdue principal of such Notes or
from payments from the proceeds of a sale or exchange of such Notes;
(e) any tax, assessment or other governmental charge required to be
withheld by any Paying Agent from any payment of principal of, or any premium or
interest on, the Notes, if such payment can be made without such withholding by
any of the other Paying Agents in western Europe;
(f) any tax, assessment or other governmental charge which would not have
been imposed but for the failure to comply with certification, information,
documentation or other reporting requirements concerning the nationality,
residence, identity or connections with the United States of the Holder or
beneficial owner of the Notes or any coupon appertaining thereto, if such
compliance is required by statute or by regulation of the United States Treasury
Department as a pre-condition to relief or exemption from such tax, assessment
or other governmental charge;
(g) in the case of Notes other than Zero-Coupon Notes, any tax, assessment
or other governmental charge imposed on interest received by (and in the case of
Zero-Coupon Notes, any tax, assessment or other governmental charge imposed by
reason of such Holder's past or present status as), (i) a 10% shareholder (as
defined in Section 871(h)(3)(B) of the Code, and the regulations that may be
promulgated thereunder) of Citicorp, or (ii) a controlled foreign corporation,
within the meaning of the Code, that is related to Citicorp through stock
ownership; or
(h) any combination of items (a), (b), (c), (d), (e), (f) and (g);
nor will additional amounts be paid with respect to any payment of principal of
and any premium or interest on a Note, other than a Zero-Coupon Note (or, in the
case of a Zero-Coupon Note, any payment of principal of or any interest on
overdue principal of, or of the proceeds of any sale or exchange of, any such
Note) to any Holder that is a United States Alien that is a fiduciary or
partnership or other than the sole beneficial owner of any such payment to the
extent that a beneficiary or settler with respect to such fiduciary, a member of
such partnership or the beneficial owner would not have been entitled to the
additional amounts had such beneficiary, settlor, member or beneficial owner
been the Holder of such Note or any coupon appertaining thereto.
"United States Alien" means any person who, for United States federal
income tax purposes, is a foreign corporation, a non-resident alien individual,
a non-resident alien fiduciary of a foreign estate or trust, or a foreign
partnership to the extent that one or more of the members is, for United States
federal income tax purposes, a foreign corporation, a non-resident alien
individual or a non-resident alien fiduciary of a foreign estate or trust, in
each case not subject to United States federal income tax on a net income basis
in respect of a Note.
Notwithstanding the foregoing, if and so long as a certification,
information, documentation or other reporting requirement with respect to any
and all Notes referred to in the last paragraph under "Redemption and Sinking
Funds" above would be fully satisfied by payment of a withholding tax, backup
withholding tax or similar charge, Citicorp may elect, by so stating in the
Determination Notice, to have the provisions of this paragraph apply in lieu of
the provisions of such paragraph. In such event, Citicorp will pay as additional
amounts with respect to any Note Citicorp determines to be subject to such
requirement such amounts as may be necessary so that every net payment made
following the effective date of such requirement outside the United States by
Citicorp or any of its Paying Agents of principal of or any premium or interest
due in respect of any Bearer Note or any coupon appertaining thereto of which
the beneficial owner is a United States Alien (but without any requirement that
the nationality, residence or identity of such beneficial owner be disclosed to
Citicorp, any Paying Agent or any governmental authority), after deduction or
withholding for or on account of such withholding tax, backup withholding tax or
similar charge (other than a withholding tax, backup withholding tax or similar
charge which (a) would not be applicable to a payment made to a custodian,
nominee or other agent of the beneficial owner or which can be satisfied by such
a custodian, nominee or other agent certifying to the effect that such
beneficial owner is a United States Alien; provided, however, in each case that
payment by such custodian, nominee or agent to such beneficial owner is not
otherwise subject to any requirement referred to in this paragraph, (b) is
applicable only to payment by a custodian, nominee or other agent of the
beneficial owner to such beneficial owner, (c) would not be applicable to a
payment made by any other Paying Agent of Citicorp in Western Europe, or (d) is
imposed as a result of presentation of such Bearer Note or coupon for payment on
a date more than 10 days after the date on which such payment becomes due and
payable or the date on which payment thereof is duly provided for, whichever
occurs later), will not be less than the amount provided for in such Bearer Note
or coupon to be then due and payable.
S-21
<PAGE>
Publication of Notices
Citicorp currently expects to publish notices to Holders of Bearer Notes
in The Wall Street Journal, the Financial Times and the Luxembourg Wort. So long
as any of the Notes are listed on the Stock Exchange, notices to Holders of, or
owners of beneficial interests in, Bearer Notes will be published in Luxembourg.
SPECIAL PROVISIONS RELATING TO FOREIGN CURRENCY NOTES
General
The following provisions, which apply to Foreign Currency Notes,
supplement the description of general terms and provisions of Notes set forth in
the accompanying Prospectus and elsewhere in this Prospectus Supplement. For a
description of certain risks associated with Foreign Currency Notes, see
"Foreign Currency Risks" below.
The authorized denominations for particular Foreign Currency Notes will be
indicated in the applicable Pricing Supplement.
Specific information pertaining to the Specified Currency in which a
particular Foreign Currency Note is denominated, including historical exchange
rates and a description of the Specified Currency and any exchange controls,
will be described in the applicable Pricing Supplement. See "Foreign Currency
Risks--Exchange Rates and Exchange Controls" below.
Unless otherwise specified in the applicable Pricing Supplement,
purchasers are required to pay for Foreign Currency Notes in the Specified
Currency.
Payment
Unless otherwise specified in the applicable Pricing Supplement, the
principal of and any premium and interest on Foreign Currency Notes are payable
by Citicorp in the Specified Currency. Principal of and any premium and interest
on Foreign Currency Notes that are Bearer Notes will be paid in the manner
specified in the accompanying Prospectus and this Prospectus Supplement for
principal of and any premium and interest on Bearer Notes generally, except that
all such payments will be made by wire transfer or check upon presentation of
the applicable coupon or surrender of the definitive Bearer Note, as the case
may be. Principal of and any premium and interest on Foreign Currency Notes that
are Registered Notes will also be paid in the manner specified in the
accompanying Prospectus and this Prospectus Supplement for principal of and any
premium and interest on Registered Notes generally, except that all such
payments will be made by check mailed to the address of the Person entitled
thereto as it appears in the Security Register. All checks payable in a
Specified Currency for purposes of payment of principal of and any premium and
interest on Foreign Currency Notes will be drawn on a bank located outside the
United States. See "Description of Notes--Payment and Paying Agents" above.
If a Specified Currency is not available for the payment of principal or
any premium or interest with respect to a Foreign Currency Note, other than
Foreign Currency Notes denominated in ECUs due to the imposition of exchange
controls or other circumstances beyond the control of Citicorp or is no longer
used by the government of the country issuing such Specified Currency or for the
settlement of transactions by public institutions of or within the international
banking community, Citicorp will be entitled to satisfy its obligations to
Holders of such Foreign Currency Notes by making such payment in U.S. dollars on
the basis of the Market Exchange Rate two Market Days prior to the date of such
payment, or if such Market Exchange Rate is not then available, on the basis of
the most recently available Market Exchange Rate. See "European Currency Unit"
for a description of the manner in which Citicorp may satisfy its obligations to
Holders of Foreign Currency Notes denominated in ECUs in the event the ECU is
unavailable or is not used. See "Foreign Currency Risks--Exchange Rates and
Exchange Controls" below.
The "Market Exchange Rate" for any Specified Currency means the noon
buying rate in The City of New York for cable transfers for such Specified
Currency as certified for customs purposes by the Federal Reserve Bank of New
York.
European Currency Unit
Value of the ECU. Subject to the provisions of "Payment Currency" below,
with respect to Foreign Currency Notes denominated in ECUs, "ECU" shall mean at
any time an amount equal in value to one European Currency Unit and "European
S-22
<PAGE>
Currency Unit" denotes the unit of account that is from time to time used in the
European Monetary System ("EMS") and which is, at the date of this Prospectus
Supplement, valued on the basis of specified amounts of the currencies of twelve
of the member countries of the European Community ("EC") as shown below.
Pursuant to Council Regulation (EEC) No. 3320/94 of December 22, 1994, the
ECU is at the date of this Prospectus Supplement defined as the sum of the
following amounts of the following components:
0.6242 German marks 1.393 Portuguese escudos
1.332 French francs 3.301 Belgian francs
0.08784 Pounds sterling 0.130 Luxembourg francs
151.8 Italian lire 0.1976 Danish kroner
0.2198 Dutch guilders 0.008552 Irish pounds
6.885 Spanish pesetas 1.440 Greek drachmas
Such amounts and/or components may be changed by the EC, in which event the
basis of valuation of the ECU will change accordingly.
Payment Currency. With respect to each due date for the payment of
principal of or any premium or interest on Foreign Currency Notes denominated in
ECUs on which the ECU is unavailable or is not used in the EMS, Citicorp shall,
without liability on its part, satisfy its obligations to Holders of such Notes
by choosing a component currency (the "chosen currency") of the ECU in which all
payments due on such due date shall be made, the amount of each such payment to
be computed on the basis of the equivalent of the ECU in the chosen currency
determined as described below, as of the fourth Market Day prior to the date on
which such payment is due; provided, however, that on the first Market Day on
which the ECU is unavailable or is not used in the EMS, Citicorp shall, without
liability on its part, select a chosen currency in which all payments with
respect to Foreign Currency Notes denominated in ECUs due but unpaid are to be
made, computed on the basis of the equivalent of the ECU in that currency
determined as described below, as of such first Market Day.
The equivalent of the ECU in the chosen currency as of any date (the "Day
of Valuation") shall be determined by, or on behalf of, the Stock Exchange on
the following basis. The component currencies of the ECU for this purpose shall
be the currency amounts that were components of the ECU as of the last date on
or before the Day of Valuation on which the ECU was available or used in the
EMS. The equivalent of the ECU in the chosen currency shall be calculated by,
first, aggregating the U.S. dollar equivalent of the components, and then, using
the rate used for determining the U.S. dollar equivalent of the chosen currency
component as set forth below, calculating the equivalent in the chosen currency
of such aggregate amount in U.S. dollars. The U.S. dollar equivalent of each of
the components shall be determined by, or on behalf of, the Stock Exchange on
the basis of the middle spot delivery quotations prevailing at 2:30 P.M.
(Luxembourg time) on the Day of Valuation, as obtained by, or on behalf of, the
Stock Exchange from one or more major banks, selected by Citicorp, located in
the country of issue of the relevant component currency.
If for any reason no direct quotations are available for a component as of
a Day of Valuation from any of the banks selected by Citicorp for such purpose
as described above, the most recent direct quotations for such component
obtained by, or on behalf of, the Stock Exchange shall be used in computing the
U.S. dollar equivalent of such component on such Day of Valuation; provided,
however, that such direct quotations may be used only if they were prevailing in
the country of issue of the relevant component currency not more than two Market
Days prior to such Day of Valuation. The Stock Exchange shall determine the U.S.
dollar equivalent of such component on the basis of cross rates derived from the
middle spot delivery quotations for such component currency and for the U.S.
dollar prevailing at 2:30 P.M., Luxembourg time, on such Day of Valuation, as
obtained by, or on behalf of, the Stock Exchange from one or more major banks,
as selected by Citicorp, in a country other than the country of issue of such
component currency. Notwithstanding the foregoing, within such period of two
Market Days, the Stock Exchange shall determine the U.S. dollar equivalent of
such component on the basis of such cross rates if Citicorp determines that the
equivalent so calculated is more representative than the U.S. dollar equivalent
calculated on the basis of such most recent direct quotations. If there is more
than one market for dealing in any component currency by reason of foreign
exchange regulations or for any other reason, the market to be referred to in
respect of such currency shall be that upon which a non-resident issuer of
securities denominated in such currency would purchase such currency in order to
make payments in respect of such securities.
S-23
<PAGE>
If the official unit of any component currency is altered by way of
combination or subdivision, the number of units of such currency as a component
shall be divided or multiplied in the same proportion. If two or more component
currencies are consolidated into a single currency, the amounts of those
currencies as components shall be replaced by an amount in such single currency
equal to the sum of the amounts of such consolidated component currencies
expressed in such single currency. If any component currency is divided into two
or more currencies the amount of such currency as a component shall be replaced
by amounts of such two or more currencies, each of which shall be equal to the
amount of such former component currency divided by the number of currencies
into which such component currency was divided.
All determinations made by, or on behalf of, the Stock Exchange or
Citicorp as described above shall be at their sole discretion and shall, in the
absence of manifest error, be conclusive for all purposes and binding on all
Holders of Foreign Currency Notes denominated in ECUs.
Under Article 109G of the Treaty establishing the European Communities
(the "Treaty of Rome"), as amended by the Treaty of European Communities (the
"Maastricht Treaty" and together with the Treaty of Rome, the "Treaty"), the
currency composition of the ECU may not be changed. The treaty contemplates that
European monetary union will occur in three stages, the second of which began on
January 1, 1994 with the entry into force of the Maastricht Treaty. The Treaty
provides that, at the start of the third stage of European monetary union, the
value of the ECU as against the currencies of the member states participating in
the third stage will be irrevocably fixed, and the ECU will become a currency in
its own right. In contemplation of that third stage, the European Council
meeting in Madrid on December 16, 1995 decided that the name of that currency
will be the Euro and that, in accordance with the Treaty, substitution of the
Euro for the ECU will be at the rate of one Euro for one ECU. From the start of
the third stage of European monetary union, all payments in respect of
instruments denominated in ECU will be made in Euro at the rate then established
in accordance with the Treaty. See also "European Monetary Union" below.
European Monetary Union
The Treaty provides that the Euro will replace some or all of the
currencies of the member states of the EC. The third stage of the process of
European monetary union is currently scheduled to begin in 1999 by irrevocably
fixing the value of the national currencies of participating member states
against the Euro and to be completed in 2002 by the withdrawal from legal tender
of such national currencies. As of the date hereof, there can be no assurance as
to whether European monetary union, as described above, will occur, whether the
current schedule will be adhered to, which EC member states will participate or
how European monetary union may affect the value of or the rights of holders of
Notes issued prior to the completion of European monetary union.
In July 1997, the General Obligations Law of the State of New York was
amended to provide that, subject to any agreement otherwise made between the
parties to a contract, security or instrument governed by New York law, (a) if a
currency of payment for any such contract, security or instrument is the ECU or
a currency that is substituted or replaced by the Euro, payments on such
contract, security or instrument may instead be tendered in Euro at the
conversion rate specified in, and otherwise calculated in accordance with,
regulations adopted by the Council of the European Union, (b) payments on such
contract, security or instrument may also be made in the currency or currencies
originally designated in the contract, security or instrument so long as such
currency or currencies remain legal tender and (c) the introduction of the Euro
and the making of payments under a contract, security or instrument in
accordance with the foregoing provisions will not have the effect of discharging
or excusing performance under any such contract, security or instrument, or give
a party the right to unilaterally alter or terminate any such contract, security
or instrument.
The applicable Pricing Supplement relating to an issue of Notes
denominated in a national currency of one of the member states of the EC will
specify any relevant provisions with respect to the redenomination of such Notes
or any payments to be made thereunder.
FOREIGN CURRENCY RISKS
General
PROSPECTIVE PURCHASERS SHOULD CONSULT THEIR OWN FINANCIAL AND LEGAL
ADVISORS AS TO THE RISKS ENTAILED BY AN INVESTMENT IN FOREIGN CURRENCY NOTES OR
INDEXED NOTES INDEXED TO A FOREIGN CURRENCY OR CURRENCY UNIT OTHER THAN THE
PURCHASER'S HOME CURRENCY. FOREIGN
S-24
<PAGE>
CURRENCY NOTES OR INDEXED NOTES INDEXED TO A FOREIGN CURRENCY OR CURRENCY UNIT
ARE NOT AN APPROPRIATE INVESTMENT FOR INVESTORS WHO ARE UNSOPHISTICATED WITH
RESPECT TO FOREIGN CURRENCY TRANSACTIONS.
Exchange Rates and Exchange Controls
An investment in a Foreign Currency Note having a Specified Currency other
than the currency of the country in which a purchaser is resident or the
currency (including ECU and any other such composite currency) in which a
purchaser conducts its business or activities (the "home currency"), or Indexed
Notes indexed to a currency or currency unit other than the purchaser's home
currency, entails significant risks that are not associated with a similar
investment in a security denominated in the home currency. Such risks include,
without limitation, the possibility of significant changes in rates of exchange
between the home currency and such Specified 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 and the supply of and demand for the relevant currencies over
which Citicorp has no control. In recent years, rates of exchange for certain
currencies have been highly volatile and such 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 Note. Depreciation of the
Specified Currency applicable to a Foreign Currency Note against the relevant
home currency would result in a decrease in the effective yield of such Note
below its specified rate and, in certain circumstances, could result in a loss
to the investor on a home currency basis.
Governments have from time to time imposed exchange controls and may in
the future impose or revise exchange controls at or prior to a Foreign Currency
Note's Maturity. Even if there are no exchange controls, it is possible that the
Specified Currency for any particular Foreign Currency Note would not be
available at such Note's Maturity due to other circumstances beyond the control
of Citicorp. See "Special Provisions Relating to Foreign Currency
Notes--Payment" above.
Judgments
In the event an action based on Foreign Currency Notes were commenced in a
court of the United States, it is likely that such court would grant judgment
relating to such Notes only in U.S. dollars. It is not clear, however, whether,
in granting such judgment, the rate of conversion into U.S. dollars would be
determined with reference to the date of default, the date judgment is rendered
or some other date. The Notes will be governed by, and construed in accordance
with, the laws of the State of New York. Under Section 27 of the New York
Judiciary Law, a state court sitting in the State of New York would be required
to render a judgment on the Foreign Currency Notes in the applicable Specified
Currency. Such judgment would be converted into U.S. dollars at the exchange
rate prevailing on the date of entry of the judgment.
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
Alien Holders (as defined below). Under present United States federal income and
estate tax law and subject to the discussion of backup withholding below:
(a) payments of principal (including any OlD) and any premium and interest
on the Notes by Citicorp or any of its Paying Agents to any United States Alien
Holder will not be subject to United States federal withholding tax, provided
that in the case of interest or OlD, (1) the beneficial owner does not actually
or constructively own 10% or more of the total combined voting power of all
classes of stock of Citicorp entitled to vote, (2) the beneficial owner is not a
controlled foreign corporation that is related to Citicorp through stock
ownership,(3) if the Note is a Registered Note (including such Notes which were
received in exchange for Bearer Notes), either (i) the beneficial owner of the
Notes certifies to Citicorp or its agent, under penalties of perjury, that he is
not a United States person (as defined under "Limitations on Issuance of
Euro-Notes") and provides his name and address, or (ii) a securities clearing
organization, bank or other financial institution that holds customers'
securities in the ordinary course of its trade or business (a "financial
institution") and holds the Notes on behalf of the beneficial owner certifies to
Citicorp or its Paying Agent under penalties of perjury that such statement has
been received from the beneficial owner by it or by a financial institution
between it and the beneficial owner and furnishes the payor with a copy thereof;
and (4) the beneficial owner is not a bank as to which the Note or coupon (or
any portion thereof) is considered to be an extension of credit made by the bank
pursuant to a loan agreement entered into in the
S-25
<PAGE>
ordinary course of the bank's trade or business;
(b) a United States Alien Holder will not be subject to United States
federal withholding tax on gain realized on the sale, exchange or redemption of
a Note; and
(c) a Note or coupon held by an individual who at the time of death is not
a citizen or resident of the United States will not be subject to United States
federal estate tax as a result of such individual's death if, at the time of
such death, the individual does not actually or constructively own 10% or more
of the total combined voting power of all classes of stock of Citicorp entitled
to vote and the income on the Notes would not have been effectively connected
with the conduct of a trade or business by the individual in the United States.
As used herein, a "United States Alien Holder" is a Holder who is a United
States Alien (as defined below). As used herein, a "United States Alien" means
any person who, for United States federal income tax purposes, is a foreign
corporation, a non-resident alien individual, a non-resident alien fiduciary of
a foreign estate or trust, or a foreign partnership to the extent that one or
more of the members is, for United States federal income tax purposes, a foreign
corporation, a non-resident alien individual or a non-resident alien fiduciary
of a foreign estate or trust, in each case not subject to United States federal
income tax on a net income basis in respect of a Note.
Backup Withholding and Information Reporting
Payments of principal (including OlD, 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%. Information reporting and backup withholding do not apply to
payments of principal (including OlD, if any) and any premium and interest made
outside the United States by Citicorp or a Paying Agent on a Bearer Note or
coupon, or to payments made on a Registered Note (including such Notes which
were received in exchange for Bearer Notes) if the certification described in
clause (a)(3) above is received, provided, in each case, that the payor does not
have actual knowledge that the holder is a United States person. In addition, if
payments are collected outside the United States by a foreign office of a
custodian, nominee or other agent acting on behalf of a beneficial owner of a
Bearer Note or coupon, such custodian, nominee or other agent will not be
required to deduct backup withholding from payments made to such owner. However,
if the custodian, nominee or other agent is a United States person, a controlled
foreign corporation for United States tax purposes or a foreign person 50% or
more of whose gross income is effectively connected with the conduct of a trade
or business within the United States for a specified three-year period,
information reporting will be required with respect to payments made to such
owner unless such custodian, nominee or other agent has documentary evidence in
its files of the owner's foreign status and has no actual knowledge to the
contrary, or the owner otherwise establishes an exemption.
Payment of the proceeds from the sale of a Note to or through a foreign
office of a broker will not be subject to information reporting or backup
withholding, except that if the broker is a United States person, a controlled
foreign corporation for United States tax purposes or a foreign person 50% or
more of whose gross income is effectively connected with the conduct of a trade
or business within the United States for a specified three-year period,
information reporting will apply to such payments unless such broker has
documentary evidence in its files of the owner's foreign status and has no
actual knowledge to the contrary, or the owner otherwise establishes an
exemption. Payment of the proceeds from a sale of a Note to or through the
United States office of a broker is subject to information reporting and backup
withholding unless the holder or beneficial owner certifies as to its non-United
States status or otherwise establishes an exemption from information reporting
and backup withholding.
PLAN OF DISTRIBUTION OF NOTES
Unless otherwise specified in the applicable Pricing Supplement, the
Agents will be Bear, Stearns International Limited, Citibank International plc,
Goldman Sachs International, Merrill Lynch International, Morgan Stanley & Co.
International Limited, PaineWebber International (U.K.) Ltd., Salomon Brothers
International Limited, Sanwa International plc and Yamaichi International
(Europe) Limited. Under the terms of the amended and restated selling agent
agreement dated as of January 26, 1995, as amended, between Citicorp and the
Agents named above other than Sanwa International plc and Yamaichi International
(Europe) Limited, the selling agent agreement dated as of June 6, 1995, as
amended, between Citicorp and Yamaichi International (Europe) Limited and the
selling agent agreement dated as of June 8, 1995, as amended, between Citicorp
and Sanwa International plc (collectively, the "Euro Selling Agent Agreements"),
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 offers to
purchase the Notes.
S-26
<PAGE>
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 Euro Selling Agent Agreements 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 the other selling terms for such resales may from time to
time be varied by such Agent.
Unless otherwise indicated in the applicable Pricing Supplement, payment
of the purchase price of Notes, other than Foreign Currency Notes, will be
required to be made in funds immediately available in The City of New York. With
respect to payment of the purchase price of Foreign Currency Notes, see "Special
Provisions Relating to Foreign Currency Notes--General" above.
Each Agent has agreed in a Euro Selling Agent Agreement that it will not,
as principal or agent, offer, sell or deliver, directly or indirectly, any
Notes, however acquired, in the United States and its possessions and has also
agreed to observe the restrictions of offering, sale and delivery of Notes, and
to deliver the covenants, described under "Limitations on Issuance of
Euro-Notes" in the accompanying Prospectus. Each Agent has further agreed in a
Euro Selling Agent Agreement that (i) in relation to Notes that have a maturity
of one year or more, it has not offered or sold and, prior to the expiration of
the period of six months from each Issue Date for the Notes, will not offer or
sell any Notes to persons in the United Kingdom except to persons whose ordinary
activities involve them in acquiring, holding, managing or disposing of
investments (as principal or agent) for the purposes of their businesses or
otherwise in circumstances which have not resulted and will not result in an
offer to the public in the United Kingdom within the meaning of the Public
Offers of Securities Regulations 1995; (ii) it has complied and will comply with
all applicable provisions of the Financial Services Act of 1986 (the "Act") with
respect to anything done by it in relation to the Notes in, from or otherwise
involving the United Kingdom; and (iii) it has only issued or passed on and will
only issue or pass on in the United Kingdom any document received by it in
connection with the issue of the Notes to a person who is of a kind described in
Article 11(3) of the Financial Services Act 1986 (Investment Advertisements)
(Exemptions) Order 1996 (as amended) or is a person to whom such document may
otherwise lawfully be issued or passed on.
The Agents may be deemed to be "underwriters" within the meaning of the
United States Securities Act of 1933, as amended (the "Securities Act"), and any
discounts or commissions received by them from Citicorp and any profit realized
by them on sale or resale of the Notes may be deemed to be underwriting
discounts and commissions under the Securities Act. Citicorp has agreed to
indemnify the Agents against and contribute toward certain liabilities,
including liabilities under the Securities 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) are being, and may in the future
continue to 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 in 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 & 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 domestic agents for Citicorp (the "Domestic Selling
Agent Agreement"), and directly to investors on its own behalf. The terms of the
Domestic Selling Agent Agreement are substantially similar to the terms of the
Euro Selling Agent Agreements, except that the Domestic Selling Agent Agreement
does not contain the selling restrictions described above. Any Notes sold
pursuant to the Domestic Selling Agent Agreement, sold by Citicorp to any of
such domestic agents for resale as contemplated by the Domestic Selling Agent
Agreement or sold by Citicorp directly to investors will, in the case of the
sale of senior notes, reduce the aggregate principal 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 principal
amount of Subordinated Notes which may be offered by this Prospectus Supplement
and the Prospectus.
S-27
<PAGE>
The Agents may engage in over-allotment, stabilizing transactions,
syndicate covering transactions and penalty bids in accordance with Regulation M
under the Exchange Act. Over-allotment involves syndicate sales in excess of the
offering size, which creates a syndicate short position. Stabilizing
transactions permit bids to purchase the underlying Notes so long as the
stabilizing bids do not exceed a specified maximum. Syndicate covering
transactions involve purchases of the Notes in the open market after the
distribution has been completed in order to cover syndicate short positions.
Penalty bids permit the Agents to reclaim a selling concession from a syndicate
member when the Notes originally sold by such syndicate member are purchased in
a syndicate covering transaction to cover syndicate short positions. Such
stabilizing transactions, syndicate covering transactions and penalty bids may
cause the price of the Notes to be higher than it would otherwise be in the
absence of such transactions. These transactions may be effected on the Stock
Exchange or otherwise and, if commenced, may be discontinued at any time.
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 .01% of the outstanding common stock
of Citicorp.
GENERAL INFORMATION
Application has been made to list the Notes issued under Citicorp's Global
Medium-Term Notes, Series D program on the Stock Exchange. In connection with
the listing the Restated Certificate of Incorporation, as amended, and By-laws
of Citicorp and a legal notice relating to the issuance of the Notes were
deposited with the Chief Registrar of the District Court of Luxembourg, where
copies thereof may be obtained upon request.
The issuance and sale of the Notes have been duly authorized by
resolutions adopted by the Board of Directors of Citicorp on December 20, 1988
(the "1988 Resolutions"), December 20, 1994 (the "1994 Resolutions") and
December 17, 1996 (the "1996 Resolutions", and together with the 1988
Resolutions and 1994 Resolutions, the "Resolutions") and, in the case of the
Senior Notes, by memoranda of approval issued pursuant to the Resolutions dated
July 21, 1992, July 25, 1994, January 26, 1995 and July 18, 1995, and, in the
case of the Subordinated Notes, by memoranda of approval issued pursuant to the
1988 Resolutions and 1994 Resolutions dated September 17, 1993 and September 12,
1996.
A copy of each Pricing Supplement relating to the Notes may be obtained
from Citibank (Luxembourg) S.A., Luxembourg, and the Stock Exchange so long as
any of the Notes are listed on the Stock Exchange. So long as any of the Notes
are listed on the Stock Exchange, copies of the Restated Certificate of
Incorporation, as amended, and By-Laws of Citicorp, the Euro Selling Agent
Agreement and the Indentures will be available for inspection by Holders of the
Notes at the above office of Citibank (Luxembourg) S.A. and copies of Citicorp's
most recent Annual Report on Form 10-K, Financial Reviews and Forms 10-Q and
Current Reports on Form 8-K, which are incorporated by reference herein, may be
obtained from the office of Citibank (Luxembourg) S.A., Luxembourg.
In the opinion of the management of Citicorp, as of the date of this
Prospectus Supplement, there is no litigation, actual or pending, which relates
to Citicorp or any of its subsidiaries and to which Citicorp is a party or of
which Citicorp has been notified that it will be made a party, which is material
in the context of the issuance of the Notes.
As of the date of this Prospectus Supplement, there has been no material
adverse change in the financial position of Citicorp and its subsidiaries
considered as a whole since the date of the latest reports filed with the United
States Securities and Exchange Commission.
Citicorp is a holding company incorporated under the laws of the State of
Delaware on December 4, 1967 whose principal subsidiary is Citibank, N.A. The
principal office of Citicorp is located at 399 Park Avenue, New York, New York
10043; its telephone number is (212) 559-1000.
S-28
<PAGE>
The Notes will be accepted for clearance through Euroclear and Cedel.
The Pricing Supplement for each Issue of Notes will contain such of the
following information as is applicable in respect of the Notes of such Issue:
a. the name(s) of the Agent(s) of the Notes and the commission to paid to
such Agent(s) ;
b. the aggregate principal amount of the Issue;
c. If the Notes of an Issue are Foreign Currency Notes, the Specified
Currency, together with certain relevant information relating to such
Specified Currency, including historical exchange rates and exchange
controls, if any, a description of special United States federal tax
consequences related to the ownership of such Foreign Currency Notes and
the authorized denominations of such Foreign Currency Notes;
d. if the Notes of an Issue are to be issued in denominations other than as
specified in this Prospectus Supplement, the denomination(s) of the Notes;
e. the Issue Date of the Notes and the Stated Maturity of the Notes;
f. the price to the public of the Notes;
g. the rate at which such Notes bear interest or the manner in which the rate
of interest is to be determined;
h. the Interest Commencement Date;
i. the Interest Payment Dates;
j. the Interest Determination Dates and the Calculation Dates;
k. the terms and conditions of any redemption and/or sinking fund provision
applicable to an Issue;
l. the common code for Euroclear and Cedel and the relevant ISIN and, if
appropriate, the relevant CUSIP number;
m. whether or not such Notes are to be listed on the Stock Exchange or any
other stock exchange; and
n. details of any terms and conditions of the Notes to the extent such terms
and conditions vary from the terms and conditions of the Notes as
described in this Prospectus Supplement and the Prospectus, including,
without limitation, details of any variation in the principal United
States federal income tax consequences of the ownership and disposition of
the Notes, any additional events of default relating to the Issue, any
additional selling restrictions relating to the Issue and any variation in
the settlement procedures that will apply to the Issue.
S-29
<PAGE>
MANAGEMENT OF THE COMPANY
The Executive Officers of the Company are:
William I. Campbell.................. Executive Vice President
Paul J. Collins...................... Vice Chairman
Edward D. Horowitz................... Executive Vice President
Thomas E. Jones...................... Executive Vice President
Charles E. Long...................... Executive Vice President and Secretary
Dionisio R. Martin................... Executive Vice President
Robert A. McCormack.................. Executive Vice President
Victor J. Menezes.................... Executive Vice President
Lawrence R. Phillips................. Senior Human Resources Officer
John S. Reed......................... Chairman
William R. Rhodes.................... Vice Chairman
John J. Roche........................ Executive Vice President
H. Onno Ruding....................... Vice Chairman
Mary Alice W. Taylor................. Executive Vice President
The Directors of the Company are:
Alain J. P. Belda......... President and Chief Operating Officer, Aluminum
Company of America
D. Wayne Calloway........... Former Chairman and Chief Executive Officer,
PepsiCo, Inc.
Paul J. Collins............. Vice Chairman, Citicorp
Kenneth T. Derr............. Chairman and Chief Executive Officer, Chevron
Corporation
John M. Deutch.............. Institute Professor-Massachusetts Institute of
Technology
Reuben Mark................. Chairman and Chief Executive Officer, Colgate-
Palmolive Company
Richard D. Parsons.......... President, Time-Warner, Inc.
John S. Reed................ Chairman, Citicorp
William R. Rhodes........... Vice Chairman, Citicorp
Rozanne L. Ridgway.......... Former United States Assistant Secretary of State
for Europe and Canada
H. Onno Ruding.............. Vice Chairman, Citicorp
Robert B. Shapiro........... Chairman, President and Chief Executive Officer,
Monsanto Company
Frank A. Shrontz............ Chairman Emeritus, The Boeing Company
Franklin A. Thomas.......... Former President, The Ford Foundation
Edgar S. Woolard, Jr........ Chairman and Chief Executive Officer, E.I. du
Pont de Nemours & Company
S-30
<PAGE>
<PAGE>
PROSPECTUS
CITICORP [LOGO]
Senior Notes
Subordinated Notes
This Prospectus may be used in connection with the offering of Citicorp's
unsecured debt securities, which may be either senior (the "Senior Notes") or
subordinated (the "Subordinated Notes" and, together with the Senior Notes, the
"Notes"). The Notes may be offered, separately or together, in separate series
in amounts, at prices and on terms determined at the time of sale and set forth
in one or more supplements to this Prospectus (collectively, the "Prospectus
Supplement"). Pursuant to the terms of the Registration Statement of which this
Prospectus forms a part, Citicorp's preferred stock, 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 August 27, 1997
1
<PAGE>
The specific terms of each series of Notes offered pursuant to this
Prospectus will be set forth in the applicable Prospectus Supplement, which will
identify any underwriters or agents for the Notes being offered thereby and
their compensation, and the public offering or purchase price.
With respect to each series of Notes, the related Prospectus Supplement
will set forth the aggregate principal amount offered, the rate and time of
payment of interest, if any, the authorized denominations, the maturity,
priority, premium, if any, any terms for redemption or conversion at the option
of Citicorp or the holder, the currency or composite currency, if not the U.S.
dollar, in which the Notes are denominated, and any mandatory or optional
sinking fund or analogous provisions.
The Prospectus Supplement will also contain information, where applicable,
concerning certain United States federal income tax considerations relating to,
and as to any listing on a securities exchange of, the Notes covered by such
Prospectus Supplement.
The Notes may be offered by Citicorp directly to purchasers, through
agents designated from time to time, through underwriting syndicates led by one
or more managing underwriters or through one or more underwriters acting alone.
If Citicorp, directly or through agents, solicits offers to purchase Notes,
Citicorp reserves the sole right to accept and, together with its agents, to
reject in whole or in part any proposed purchase of Notes. Affiliates of
Citicorp may from time to time act as agents or underwriters in connection with
the sale of Notes to the extent permitted by applicable law.
If any agent or underwriter is involved in the sale of Notes offered
hereby, the name of such agent or underwriter and any applicable commissions or
discounts will be set forth in, or will be calculable from, the applicable
Prospectus Supplement, and the net proceeds to Citicorp from such sale will be
the purchase price of such offered Notes less such commissions or discounts and
other attributable issuance and distribution expenses. See "Plan of
Distribution" for possible indemnification arrangements for agents, underwriters
and their controlling persons.
This Prospectus and related Prospectus Supplements may be used by direct
or indirect subsidiaries of Citicorp in connection with offers and sales related
to secondary market transactions in the Notes. Such subsidiaries may act as
principal or agent in such transactions. Such sales will be made at prices
related to prevailing market prices at the time of sale.
This Prospectus may not be used to consummate sales of Notes unless a
Prospectus Supplement is also delivered. The delivery of this Prospectus
together with a Prospectus Supplement relating to particular Notes shall not
constitute an offer in any jurisdiction of any of the other Notes covered by
this Prospectus.
FOR NORTH CAROLINA RESIDENTS: THE COMMISSIONER OF INSURANCE OF THE STATE
OF NORTH CAROLINA HAS NOT APPROVED OR DISAPPROVED THIS OFFERING NOR HAS THE
COMMISSIONER PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
2
<PAGE>
AVAILABLE INFORMATION
Citicorp is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, 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 Reviews and Forms 10-Q for the quarters ended March 31, 1997
and June 30, 1997; and
(3) Current Reports on Form 8-K dated January 21, 1997, April 15, 1997 and
July 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.
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.
3
<PAGE>
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.
4
<PAGE>
RATIOS OF INCOME TO FIXED CHARGES
For the six months ended June 30, 1997 and 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:
<TABLE>
<CAPTION>
Six
Months
Ended
June 30, Year Ended December 31,
-------- -------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1997 1996 1995 1994 1993 1992
Income to Fixed Charges:
Excluding Interest on Deposits 2.84 2.69 2.31 1.76 1.44 1.24
Including Interest on Deposits 1.50 1.48 1.42 1.31 1.18 1.09
</TABLE>
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 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.
5
<PAGE>
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 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
6
<PAGE>
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."
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
7
<PAGE>
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 through
which any such transfer agent acts, except that if Notes of a series are
issuable solely as Registered
8
<PAGE>
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 an applicable Prospectus Supplement,
principal of and any premium and interest on Registered Notes will be payable,
subject to any applicable laws and regulations, at the office of such Paying
Agent or Paying Agents as Citicorp may designate from time to time, except that
at the option of Citicorp payment of any interest may be made by check mailed to
the address of the Person entitled thereto as such address shall appear in the
Security Register. (Indentures ss.201). Unless otherwise indicated in an
applicable Prospectus Supplement, payment of interest on a Registered Note on
any Interest Payment Date will be made to the Person in whose name such
Registered Note (or Predecessor Note) is registered at the close of business on
the Regular Record Date for such interest. (Indentures ss.307).
Unless otherwise indicated in the applicable Prospectus Supplement, the
Corporate Trust Office of Citibank in The City of New York will be designated as
a Paying Agent for Citicorp for payments with respect to Notes of each series
which are issuable solely as Registered Notes and as a Paying Agent for payments
with respect to Notes of each series (subject to the limitations described above
in the case of Bearer Notes) which are issuable solely as Bearer Notes or as
both Registered Notes and Bearer Notes. Any
9
<PAGE>
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 surrenderedfor 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 an applicable Prospectus Supplement, but,
unless otherwise specified in an applicable Prospectus Supplement, only upon
receipt by Euroclear or Cedel of written certification in the form and to the
effect described above under "Form, Exchange, Registration and Transfer." No
Note delivered in exchange for any portion of a temporary global Note shall be
delivered to any location in the United States or its possessions in connection
with such exchange. (Indentures ss.304).
Unless otherwise specified in an applicable Prospectus Supplement,
interest in respect of any portion of a temporary global Note payable in respect
of an Interest Payment Date occurring prior to the issuance of definitive Notes
(including a permanent global Note) will be payable to the bearer and thus,
while such temporary global Note is deposited with the common depositary for
Euroclear and Cedel, will be paid to each of Euroclear and Cedel with respect to
the portion of the temporary global Note held for its account for which it
provides certification in the form described above under "Form, Exchange,
Registration and Transfer." If an Interest Payment Date occurs prior to the
issuance of definitive Notes (including a permanent global Note), written
certification in the form and to the effect described above under "Form,
Exchange, Registration and Transfer" will be required to obtain an interest
payment, and upon receipt of such certification Euroclear or Cedel, as the case
may be, will exchange the portion of the temporary global Note relating to such
certification for an interest in a permanent global Note (unless the account
holder requests
10
<PAGE>
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)
11
<PAGE>
continued for 60 days after written notice of such default; (d) any Event of
Default; and (e) any other Default provided with respect to Subordinated Notes
of that series. (Subordinated Indenture ss.503). Unless otherwise provided in
the applicable Prospectus Supplement, the following will be the Events of
Default under the Subordinated Indenture with respect to any series of
Subordinated Notes: (x) certain events of bankruptcy, insolvency or
reorganization of Citicorp; and (y) any other Event of Default provided with
respect to Subordinated Notes of that series. (Subordinated Indenture ss.501).
Unless an Event of Default has occurred and shall be continuing with respect to
a series of Subordinated Notes, neither the holders of such Subordinated Notes
nor the Subordinated Trustee may declare the acceleration of the payment of
principal or premium, if any, of such Subordinated Notes under the Subordinated
Indenture.
Subject to the provisions of the applicable Indenture relating to the
duties of the related Trustee, in case an Event of Default with respect to
either the Senior Notes or the Subordinated Notes shall occur, or in case a
Default with respect to the Subordinated Notes shall occur and be continuing,
such Trustee will be under no obligation to exercise any of its rights or powers
under such Indenture at the request or direction of any of the holders of Notes
of any series or any related coupons unless such holders shall have offered to
such Trustee reasonable indemnity. (Indentures ss.ss.601, 603). The holders of a
majority in aggregate principal amount of the Outstanding Notes of any series
will have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the related Trustee, or exercising any
trust or power conferred on the Trustee, with respect to Notes of that series,
provided that such direction does not conflict with applicable law or the
applicable Indenture or have a substantial likelihood of involving such Trustee
in personal liability. (Indentures ss.512).
If an Event of Default with respect to Notes of any series at the time
Outstanding shall occur and be continuing, either the related Trustee or the
holders of at least 25% in aggregate principal amount of the Outstanding Notes
of that series may declare the principal, or, if any such Notes are Original
Issue Discount Notes, such lesser amounts as may be described in the applicable
Prospectus Supplement, of all such Outstanding Notes of that series to be due
and payable immediately. At any time after a declaration of acceleration with
respect to Notes of any series has been made but before a judgment or decree for
payment of money due has been obtained by such Trustee, the holders of a
majority in aggregate principal amount of Outstanding Notes of that series may
rescind any declaration of acceleration and its consequences, if all payments
due (other than those due as a result of acceleration) have been made and all
Events of Default have been remedied or waived. (Indentures ss.502).
No holder of any Notes of any series or any related coupons will have any
right to institute any proceeding with respect to the applicable Indenture or
for any remedy thereunder, unless such holder shall have previously given to the
related Trustee written notice of a continuing Event of Default, with respect to
the Senior Notes or the Subordinated Notes of that series, or of a continuing
Default with respect to the Subordinated Notes of that series, the holders of at
least 25% in aggregate principal amount of the Outstanding Notes of that series
shall have made written request, and offered reasonable indemnity, to the
Trustee to institute such proceeding as Trustee, and the Trustee shall not have
received from the holders of a majority in aggregate principal amount of the
Outstanding Notes of that series a direction inconsistent with such request and
shall have failed to institute such proceeding within 60 days. (Indentures
ss.507). However, such limitations do not apply to a suit instituted by a holder
of an Outstanding Note of that series for enforcement of payment of the
principal of, or any premium or interest on, such Note on or after the
respective due dates expressed in such Note. (Indentures ss.508).
Citicorp is required to furnish annually to each Trustee a statement as to
its performance or fulfillment of covenants, agreements or conditions in the
applicable Indenture and as to the absence of defaults thereunder. (Indentures
ss.1004).
12
<PAGE>
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
13
<PAGE>
any consent which must be given by the holder of each Outstanding Note affected
thereby, as described above, any resolution with respect to any consent, waiver,
request, demand, notice, authorization, direction or other action which may be
given by the holders of not less than a specified percentage in aggregate
principal amount of Outstanding Notes of a series may be adopted at a meeting or
an adjourned meeting at which a quorum is present only by the affirmative vote
of the holders of not less than such specified percentage in aggregate principal
amount of the Outstanding Notes of that series. Any resolution passed or
decision taken at any meeting of holders of Notes of any series duly held in
accordance with the applicable Indenture will be binding on all holders of Notes
of that series and the related coupons. The quorum at any meeting called to
adopt a resolution, and at any adjourned meeting, will be Persons holding or
representing a majority in aggregate principal amount of the Outstanding Notes
of a series; provided, however, that if any action is to be taken at such
meeting with respect to a consent, waiver, request, 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.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)
14
<PAGE>
any costs or expenses of the act of assignment and assumption, (v) after giving
effect thereto, no Event of Default with respect to the Senior Notes or the
Subordinated Notes and no Default with respect to the Subordinated Notes, and no
event which, after notice or lapse of time, or both, would become an Event of
Default or Default, respectively, shall have occurred and be continuing, and
(vi) certain other conditions are met. (Indentures ss.803). Notwithstanding any
assignment and assumption with respect to the Notes of a series as described in
this paragraph, Citicorp will remain unconditionally obligated to comply with
such provisions of each Indenture as may be required to comply with applicable
law and, with respect to the Senior Notes and the Original Subordinated Notes,
Citicorp shall remain unconditionally obligated to comply with the covenant
described above under "Limitations on Liens on Stock of Citibank." (Indentures
ss.ss.803, 804).
Notices
Except as otherwise provided in the applicable Indenture, notices to
holders of Bearer Notes will be given by publication at least twice in a daily
newspaper of general circulation in The City of New York and in such other city
or cities as may be specified in such Notes. Notices to holders of Registered
Notes will be given by mail to the addresses of such holders as they appear in
the Security Register. (Indentures ss.ss.101, 106).
Title
Title to any Bearer Notes (including Bearer Notes in temporary global
form and in permanent global form) and any coupons appertaining thereto will
pass by delivery. Citicorp, the related Trustee and any agent of Citicorp or
such 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
15
<PAGE>
defeasance or covenant defeasance, Citicorp must deliver to the related
Trustee an Opinion of Counsel to the effect that the holders of such Notes will
not recognize income, gain or loss for United States federal income tax purposes
as a result of such defeasance or covenant defeasance and will be subject to
United States federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such defeasance or covenant
defeasance had not occurred. Such Opinion, in the case of defeasance under
clause (i) above, must refer to and be based upon a published ruling of the
Internal Revenue Service or changes in applicable United States federal income
tax law occurring after the date of the applicable Indenture. (Indentures
Article Fourteen).
Defeasance by Citicorp with respect to the Notes of a series is permitted
notwithstanding Citicorp's prior covenant defeasance with respect to such
series. Following a defeasance, payment of such Notes may not be accelerated
because of an Event of Default or a Default. (Indentures ss.1402). Following a
covenant defeasance, payment of Senior Notes or the Original Subordinated Notes
may not be accelerated by reference to the covenant noted under clause(ii)
above. (Senior Indenture ss.1403, Original Subordinated Indenture ss.1403).
However, if such an acceleration were to occur, the realizable value at the
acceleration date of the money and U.S. Government Obligations in the defeasance
trust could be less than the principal and interest then due on such Notes, in
that the required deposit in the defeasance trust is based upon scheduled cash
flows rather than market value, which will vary depending upon interest rates
and other factors.
Subordination
The Subordinated Notes will be subordinate and junior in right of payment,
to the extent set forth in the Subordinated Indenture, to all Senior
Indebtedness (as defined below) of Citicorp. In the event that Citicorp shall
default in the payment of any principal of (or premium, if any) or interest on
any Senior Indebtedness when the same becomes due and payable, whether at
maturity or at a date fixed for prepayment or by declaration or otherwise, then,
unless and until such default shall have been cured or waived or shall have
ceased to exist, no direct or indirect payment (in cash, property, securities,
by set-off or otherwise) shall be made or agreed to be made on account of the
principal of or interest on the indebtedness evidenced by the Subordinated
Notes, or in respect of any redemption, retirement, purchase or other
acquisition of any of the Subordinated Notes. In the event of (a) any
insolvency, bankruptcy, receivership, liquidation, reorganization, readjustment,
composition or other similar proceeding relating to Citicorp, its creditors or
its 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
16
<PAGE>
provisions with respect to the Subordinated Notes, to the payment of all Senior
Indebtedness at the time outstanding and to any securities issued in respect
thereof under any such plan of reorganization or readjustment), shall be
received by any holder of any Subordinated Notes in contravention of any of the
terms hereof and before all the Senior Indebtedness shall have been paid in
full, such payment or distribution or security shall be received in trust for
the benefit of, and shall be paid over or delivered and transferred, to the
holders of the Senior Indebtedness at the time outstanding in accordance with
the priorities then existing among such holders for application to the 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
17
<PAGE>
States person (each as defined below) other than an exempt purchaser (as defined
below). Furthermore, in compliance with such federal tax laws and regulations,
Euro-Notes may not be delivered, in connection with the sale thereof during the
restricted period, in definitive form within the United States or its
possessions.
Citicorp will not offer or sell Euro-Notes during the restricted period to
a person who is within the United States or its possessions or to a United
States person other than an exempt purchaser, and any underwriter, agent and
dealer participating in the offering of Euro-Notes must covenant that: (i) it
has not and will not offer or sell the Euro-Notes during the restricted period
to a person who is within the United States or its possessions or to a United
States person other than an exempt purchaser; (ii) it has in effect, in
connection with the offer and sale of the Euro-Notes during the restricted
period, procedures reasonably designed to ensure that its employees or agents
who are directly engaged in selling the Euro-Notes are aware that the Euro-Notes
cannot be offered or sold during the restricted period to a person who is within
the United States or its possessions or who is a United States person (other
than an exempt purchaser); (iii) it will not permit any affiliate (within the
meaning of Section 1.163-5(c)(2)(i)(D)(4)(iii) of the regulations issued under
the Internal Revenue Code (the "Treasury Regulations")) to acquire any Euro-Note
for the purpose of offering or selling it during the restricted period unless
such affiliate provides it (for the benefit of Citicorp) with the covenants
contained in this paragraph; (iv) it will not deliver any Euro-Notes, in
connection with the sale thereof during the restricted period, in definitive
form within the United States or its possessions; (v) it will not enter into any
written contract with another distributor (within the meaning of Section
1.163-5(c)(2)(i)(D)(4) of the Treasury Regulations) to offer or sell the
Euro-Notes during the restricted period unless such distributor provides it (for
the benefit of Citicorp) with the covenants contained in this paragraph; and
(vi) if it is a United States person, it is acquiring the Euro-Notes for
purposes of resale in connection with their original issuance and if it retains
the Euro-Notes for its own account, it will only do so in accordance with the
requirements of Section 1.163-5(c)(2)(i)(D)(6) of the Treasury Regulations.
For purposes of the selling restrictions described in this section, an
offer or sale will be considered to be made to a person who is within the United
States or its possessions if the offeror or seller of the Euro-Notes has an
address within the United States or its possessions for the offeree or buyer of
the Euro-Notes with respect to the offer or sale. Bearer Notes and any coupons
appertaining thereto (including Euro-Notes in permanent global form exchangeable
for Bearer Notes) will bear a legend to the following effect: "Any United States
person who holds this obligation will be subject to limitations under the United
States income tax laws, including the limitations provided in Sections 165(j)
and 1287(a) of the Internal Revenue Code."
As used herein, "United States person" means a citizen or resident of the
United States, a corporation, partnership or other entity created or organized
in or under the laws of the United States and an estate or trust the income of
which is subject to United States federal income taxation regardless of its
source, "United States" means the United States of America (including the States
and the District of Columbia) and "possessions" of the United States include
Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and
Northern Mariana Islands, "restricted period" means with respect to a Note, the
period beginning on the earlier of the closing date or the first date on which
the Note is offered to persons other than distributors and ending on the
expiration of the 40-day period beginning on such date, except that,
notwithstanding the foregoing, any offer or sale of the Notes by Citicorp or a
distributor shall be deemed to be made during the restricted period if Citicorp
or the distributor holds the Note as part of an unsold allotment or
subscription, and "exempt purchaser" means (A) an exempt distributor (as defined
in Section 1.163-5(c)(2)(i)(D)(5) of the Treasury Regulations) that covenants
that it is buying the Euro-Notes for the purpose of resale in connection with
the original issuance thereof, and that if it retains the Euro-Notes for its own
account, it will do so only in accordance with the requirements of Section
1.163-5(c)(2)(i)(D)(6) of the Treasury Regulations; (B) an international
organization described in Section 7701(a)(18) of the
18
<PAGE>
Internal Revenue Code; (C) a foreign central bank (as defined in Section 895 of
the Internal Revenue Code and the Treasury Regulations thereunder); (D) a
foreign branch of a United States financial institution as described in Section
1.163-5(c)(2)(i)(D)(6)(i) of the Treasury Regulations; and (E) a United States
person who acquires the Euro-Notes through the foreign branch of a United States
financial institution and who holds the Euro-Notes through such financial
institution. Notwithstanding the foregoing, however, (i) a person described in
(A) of this paragraph will not be considered an exempt purchaser with respect to
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.
19
<PAGE>
PLAN OF DISTRIBUTION
Securities may be offered and sold by any of three means of distribution:
(1) through agents, (2) through underwriters or dealers or (3) directly to one
or more purchasers. Such underwriters, dealers or agents may be affiliates of
Citicorp, and offers and sales of Securities may include secondary market
transactions by affiliates of Citicorp. The applicable Prospectus Supplement
will set forth the terms of the offering to which such Prospectus Supplement
relates, including the name or names of any underwriters or agents, the public
offering or purchase price, the net proceeds to Citicorp from such sale, any
underwriting discounts and other items constituting underwriters' compensation,
any discounts and commissions allowed or paid to dealers, any commissions
allowed or paid to agents, and the securities exchanges, if any, on which such
Securities will be listed. Dealer trading may take place in certain of the
Securities, including Securities not listed on any securities exchange. Direct
sales may be made on a 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.
20
<PAGE>
VALIDITY OF SECURITIES
The validity of the Securities will be passed upon for Citicorp by Stephen
E. Dietz, as an AssociateGeneral Counsel of Citibank. Mr. Dietz owns or has the
right to acquire a number of shares of Common Stock of Citicorp equal to less
than 0.01% of the outstanding Common Stock of Citicorp.
EXPERTS
The consolidated financial statements of Citicorp and subsidiaries
included in Citicorp's Annual Report and Form 10-K for 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."
21
