EX-4.26



 





Exhibit 4.26




 






FORM OF




AMENDED AND RESTATED DECLARATION




OF TRUST




CITIGROUP
CAPITAL XXXI




Dated as of               , 20




 







 









 








TABLE OF CONTENTS




	 	 	 	 	 
	ARTICLE I INTERPRETATION AND DEFINITIONS

	 
	 	 	 	 
	SECTION 1.1 Definitions
	 	 	1	 
	 
	 	 	 	 
	ARTICLE II TRUST INDENTURE ACT

	 
	 	 	 	 
	SECTION 2.1 Trust Indenture Act; Application
	 	 	7	 
	 
	 	 	 	 
	SECTION 2.2 Lists of Holders of Securities
	 	 	7	 
	 
	 	 	 	 
	SECTION 2.3 Reports by the Institutional Trustee
	 	 	7	 
	 
	 	 	 	 
	SECTION 2.4 Periodic Reports to Institutional Trustee
	 	 	8	 
	 
	 	 	 	 
	SECTION 2.5 Evidence of Compliance with Conditions Precedent
	 	 	8	 
	 
	 	 	 	 
	SECTION 2.6 Defaults; Waiver
	 	 	8	 
	 
	 	 	 	 
	SECTION 2.7 Default; Notice
	 	 	9	 
	 
	 	 	 	 
	ARTICLE III ORGANIZATION

	 
	 	 	 	 
	SECTION 3.1 Name
	 	 	10	 
	 
	 	 	 	 
	SECTION 3.2 Office
	 	 	10	 
	 
	 	 	 	 
	SECTION 3.3 Purpose
	 	 	10	 
	 
	 	 	 	 
	SECTION 3.4 Authority
	 	 	10	 
	 
	 	 	 	 
	SECTION 3.5 Title to Property of the Trust
	 	 	11	 
	 
	 	 	 	 
	SECTION 3.6 Powers and Duties of the Regular Trustees
	 	 	11	 
	 
	 	 	 	 
	SECTION 3.7 Prohibition of Actions by the Trust and the Trustees
	 	 	13	 
	 
	 	 	 	 
	SECTION 3.8 Powers and Duties of the Institutional Trustee
	 	 	14	 
	 
	 	 	 	 
	SECTION 3.9 Certain Duties and Responsibilities of the Institutional Trustee
	 	 	16	 
	 
	 	 	 	 
	SECTION 3.10 Certain Rights of Institutional Trustee
	 	 	17	 
	 
	 	 	 	 
	SECTION 3.11 Delaware Trustee
	 	 	19	 
	 
	 	 	 	 
	SECTION 3.12 Execution of Documents
	 	 	20	 
	 
	 	 	 	 
	SECTION 3.13 Not Responsible for Recitals or Issuance of Securities
	 	 	20	 
	 
	 	 	 	 
	SECTION 3.14 Duration of Trust
	 	 	20	 
	 
	 	 	 	 
	SECTION 3.15 Mergers
	 	 	20	 
	 
	 	 	 	 
	ARTICLE IV SPONSOR

	 
	 	 	 	 
	SECTION 4.1 Sponsor’s Purchase of Common Securities
	 	 	22	 
	 
	 	 	 	 
	SECTION 4.2 Responsibilities of the Sponsor
	 	 	22	 
	 
	 	 	 	 
	ARTICLE V TRUSTEES







i









 






	 	 	 	 	 
	SECTION 5.1 Number of Trustees
	 	 	22	 
	 
	 	 	 	 
	SECTION 5.2 Delaware Trustee
	 	 	23	 
	 
	 	 	 	 
	SECTION 5.3 Institutional Trustee; Eligibility
	 	 	23	 
	 
	 	 	 	 
	SECTION 5.4 Qualifications of Regular Trustees and Delaware Trustee Generally
	 	 	24	 
	 
	 	 	 	 
	SECTION 5.5 Initial Trustees; Additional Powers of Regular Trustees
	 	 	24	 
	 
	 	 	 	 
	SECTION 5.6 Appointment, Removal and Resignation of Trustees
	 	 	25	 
	 
	 	 	 	 
	SECTION 5.7 Vacancies among Trustees
	 	 	26	 
	 
	 	 	 	 
	SECTION 5.8 Effect of Vacancies
	 	 	27	 
	 
	 	 	 	 
	SECTION 5.9 Meetings
	 	 	27	 
	 
	 	 	 	 
	SECTION 5.10 Delegation of Power
	 	 	27	 
	 
	 	 	 	 
	SECTION 5.11 Merger, Conversion, Consolidation or Succession to Business
	 	 	28	 
	 
	 	 	 	 
	ARTICLE VI DISTRIBUTIONS

	 
	 	 	 	 
	SECTION 6.1 Distributions
	 	 	28	 
	 
	 	 	 	 
	ARTICLE VII ISSUANCE OF SECURITIES

	 
	 	 	 	 
	SECTION 7.1 General Provisions Regarding Securities
	 	 	28	 
	 
	 	 	 	 
	ARTICLE VIII TERMINATION OF TRUST

	 
	 	 	 	 
	SECTION 8.1 Termination of Trust
	 	 	29	 
	 
	 	 	 	 
	ARTICLE IX TRANSFER OF INTERESTS

	 
	 	 	 	 
	SECTION 9.1 Transfer of Securities
	 	 	30	 
	 
	 	 	 	 
	SECTION 9.2 Transfer of Certificates
	 	 	30	 
	 
	 	 	 	 
	SECTION 9.3 Deemed Security Holders
	 	 	31	 
	 
	 	 	 	 
	SECTION 9.4 Book Entry Interests
	 	 	31	 
	 
	 	 	 	 
	SECTION 9.5 Notices to Clearing Agency
	 	 	32	 
	 
	 	 	 	 
	SECTION 9.6 Appointment of Successor Clearing Agency
	 	 	32	 
	 
	 	 	 	 
	SECTION 9.7 Definitive Capital Security Certificates
	 	 	32	 
	 
	 	 	 	 
	SECTION 9.8 Mutilated, Destroyed, Lost or Stolen Certificates
	 	 	32	 
	 
	 	 	 	 
	ARTICLE X LIMITATION OF LIABILITY OF HOLDERS OF SECURITIES, TRUSTEES OR OTHERS

	 
	 	 	 	 
	SECTION 10.1 Liability
	 	 	33	 
	 
	 	 	 	 
	SECTION 10.2 Exculpation
	 	 	33	 
	 
	 	 	 	 
	SECTION 10.3 Fiduciary Duty
	 	 	34	 
	 
	 	 	 	 
	SECTION 10.4 Indemnification
	 	 	35	 
	 
	 	 	 	 
	SECTION 10.5 Outside Businesses
	 	 	37	 






ii









 






	 	 	 	 	 
	ARTICLE XI ACCOUNTING

	 
	 	 	 	 
	SECTION 11.1 Fiscal Year
	 	 	38
	 
	 	 	 	 
	SECTION 11.2 Certain Accounting Matters
	 	 	38
	 
	 	 	 	 
	SECTION 11.3 Banking
	 	 	38
	 
	 	 	 	 
	SECTION 11.4 Withholding
	 	 	39
	 
	 	 	 	 
	ARTICLE XII AMENDMENTS AND MEETINGS

	 
	 	 	 	 
	SECTION 12.1 Amendments
	 	 	39
	 
	 	 	 	 
	SECTION 12.2 Meetings of the Holders of Securities; Action by Written Consent
	 	 	41
	 
	 	 	 	 
	ARTICLE XIII REPRESENTATIONS OF INSTITUTIONAL TRUSTEE AND DELAWARE TRUSTEE

	 
	 	 	 	 
	SECTION 13.1 Representations and Warranties of Institutional Trustee
	 	 	42
	 
	 	 	 	 
	SECTION 13.2 Representations and Warranties of Delaware Trustee
	 	 	43
	 
	 	 	 	 
	ARTICLE XIV MISCELLANEOUS

	 
	 	 	 	 
	SECTION 14.1 Notices
	 	 	43
	 
	 	 	 	 
	SECTION 14.2 Governing Law
	 	 	45
	 
	 	 	 	 
	SECTION 14.3 Intention of the Parties
	 	 	45
	 
	 	 	 	 
	SECTION 14.4 Headings
	 	 	45
	 
	 	 	 	 
	SECTION 14.5 Successors and Assigns
	 	 	45
	 
	 	 	 	 
	SECTION 14.6 Partial Enforceability
	 	 	45
	 
	 	 	 	 
	SECTION 14.7 Counterparts 
	 	 	45






	 	 	 	 	 	 
	ANNEX I	 	TERMS OF SECURITIES
	 	 	I-1
	EXHIBIT A-1	 	FORM OF CAPITAL SECURITY CERTIFICATE
	 	 	A1-1
	EXHIBIT A-2	 	FORM OF COMMON SECURITY CERTIFICATE
	 	 	A2-1
	EXHIBIT B	 	SPECIMEN OF DEBENTURE
	 	 	B-1
	EXHIBIT C	 	UNDERWRITING AGREEMENT
	 	 	C-1






iii









 






CROSS-REFERENCE TABLE*




	 	 	 	 	 
	Section of	 	 	 
	Trust Indenture Act	 	 	 
	of 1939, as amended	 	Section of Declaration
	 
	310(a)
	 	 	5.3	(a)
	310(c)
	 	Inapplicable
	311(c)
	 	Inapplicable
	312(a)
	 	 	2.2	(a)
	312(b)
	 	 	2.2	(b)
	313
	 	 	2.3
	314(a)
	 	 	2.4
	314(b)
	 	Inapplicable
	314(c)
	 	 	2.5
	314(d)
	 	Inapplicable
	314(f)
	 	Inapplicable
	315(a)
	 	 	3.9	(b)
	315(c)
	 	 	3.9	(a)
	315(d)
	 	 	3.9	(a)
	316(a)
	 	Annex I
	316(c)
	 	 	3.6	(e)








 




			
	*	 	This Cross-Reference Table does not constitute part of the Declaration and shall not affect
the interpretation of any of its terms or provisions.





iv









 





AMENDED AND RESTATED




DECLARATION OF TRUST




OF




CITIGROUP
CAPITAL XXXI




               , 20




          AMENDED AND RESTATED DECLARATION OF TRUST (“Declaration”) dated and effective as of
        , 20     , by the Trustees (as defined herein), the Sponsor (as defined herein) and by the
holders, from time to time, of undivided beneficial interests in the assets of the Trust to be
issued pursuant to this Declaration;




          WHEREAS,
the Trustees and the Sponsor established Citigroup Capital XXXI (the “Trust”), a
trust under the Statutory Trust Act (as defined herein) pursuant to a Declaration of Trust dated as
of
[          ],
20   (the “Original Declaration”) and a Certificate of Trust filed with the
Secretary of State of the State of Delaware on [
          ], 20  , for the sole purpose of issuing
and selling certain securities representing undivided beneficial interests in the assets of the
Trust and investing the proceeds thereof in certain Debentures of the Debenture Issuer;




          WHEREAS, as of the date hereof, no interests in the Trust have been issued;




          WHEREAS, all of the Trustees and the Sponsor, by this Declaration, amend and restate each and
every term and provision of the Original Declaration.




          NOW, THEREFORE, it being the intention of the parties hereto to continue the Trust as a
statutory trust under the Statutory Trust Act and that this Declaration constitute the governing
instrument of such statutory trust, the Trustees declare that all assets contributed to the Trust
will be held in trust for the benefit of the holders, from time to time, of the securities
representing undivided beneficial interests in the assets of the Trust issued hereunder, subject to
the provisions of this Declaration.




ARTICLE I

INTERPRETATION AND DEFINITIONS




SECTION 1.1 Definitions.




          Unless the context otherwise requires:




          (a) Capitalized terms used in this Declaration but not defined in the preamble above have the
respective meanings assigned to them in this Section 1.1;




 









 








          (b) a term defined anywhere in this Declaration has the same meaning throughout;




          (c) all references to “the Declaration” or “this Declaration” are to this Declaration as
modified, supplemented or amended from time to time;




          (d) all references in this Declaration to Articles and Sections and Annexes and Exhibits are
to Articles and Sections of and Annexes and Exhibits to this Declaration unless otherwise
specified;




          (e) a term defined in the Trust Indenture Act has the same meaning when used in this
Declaration unless otherwise defined in this Declaration or unless the context otherwise requires;
and




          (f) a reference to the singular includes the plural and vice versa.




          “Affiliate” has the same meaning as given to that term in Rule 405 of the Securities
Act or any successor rule thereunder.




          “Authorized Officer” of a Person means any Person that is authorized to bind such
Person.




          “Book Entry Interest” means a beneficial interest in a Global Certificate, ownership
and transfers of which shall be maintained and made through book entries by a Clearing Agency as
described in Section 9.4.




          “Business Day” means any day other than a Saturday, Sunday or a day on which banking
institutions in the City of New York, New York are permitted or required by any applicable law to
close.




          “Capital Securities Guarantee” means the guarantee agreement dated as of
        , 20 , of the Sponsor in respect of the Capital Securities.




          “Capital Security” has the meaning specified in Section 7.1.




          “Capital Security Beneficial Owner” means, with respect to a Book Entry Interest, a
Person who is the beneficial owner of such Book Entry Interest, as reflected on the books of the
Clearing Agency, or on the books of a Person maintaining an account with such Clearing Agency
(directly as a Clearing Agency Participant or as an indirect participant, in each case in
accordance with the rules of such Clearing Agency).




          “Capital Security Certificate” means a certificate representing a Capital Security
substantially in the form of Exhibit A-1.




          “Certificate” means a Common Security Certificate or a Capital Security Certificate.




          “Citigroup” means Citigroup Inc., a Delaware corporation.




2









 








          “Clearing Agency” means an organization registered as a “Clearing Agency” pursuant to
Section 17A of the Exchange Act that is acting as depositary for the Capital Securities and in
whose name or in the name of a nominee of that organization shall be registered a Global
Certificate and which shall undertake to effect book entry transfers and pledges of the Capital
Securities.




          “Clearing Agency Participant” means a broker, dealer, bank, other financial
institution or other Person for whom from time to time the Clearing Agency effects book entry
transfers and pledges of securities deposited with the Clearing Agency.




          “Closing Date” means                     , 20.




          “Code” means the Internal Revenue Code of 1986, as amended from time to time, or any
successor legislation.




          “Commission” means the Securities and Exchange Commission.




          “Common Security” has the meaning specified in Section 7.1.




          “Common Security Certificate” means a definitive certificate in fully registered form
representing a Common Security substantially in the form of Exhibit A-2.




          “Company Indemnified Person” means (a) any Regular Trustee; (b) any Affiliate of any
Regular Trustee; (c) any officers, directors, shareholders, members, partners, employees,
representatives or agents of any Regular Trustee; or (d) any officer, employee or agent of the
Trust or its Affiliates.




          “Corporate Trust Office” means the office of the Institutional Trustee at which the
corporate trust business of the Institutional Trustee shall, at any particular time, be principally
administered, which office at the date of execution of this Declaration is located at 101 Barclay
Street-8W, New York, New York 10286.




          “Covered Person” means: (a) any officer, director, shareholder, partner, member,
representative, employee or agent of (i) the Trust or (ii) the Trust’s Affiliates; and (b) any
Holder of Securities.




          “Debenture Issuer” means Citigroup Inc. (or the Sponsor) in its capacity as issuer of
the Debentures under the Indenture.




          “Debenture Trustee” means The Bank of New York, as trustee under the Indenture until a
successor is appointed thereunder, and thereafter means such successor trustee.




          “Debentures” means the series of Debentures to be issued by the Debenture Issuer under
the Indenture to be held by the Institutional Trustee, a specimen certificate for such series of
Debentures being Exhibit B.




          “Default” in respect of the Securities means a Default (as defined in the Indenture)
has occurred and is continuing in respect of the Debentures.




3









 








          “Definitive Capital Security Certificates” has the meaning set forth in Section 9.4.




          “Delaware Trustee” has the meaning set forth in Section 5.2.




          “Distribution” has the meaning set forth in Section 6.1.




          “DTC” means the Depository Trust Company, the initial Clearing Agency.




          “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to
time, or any successor legislation.




          “Fiduciary Indemnified Person” has the meaning set forth in Section 10.4(b).




          “Global Certificate” has the meaning set forth in Section 9.4.




          “Holder” means a Person in whose name a Certificate representing a Security is
registered, such Person being a beneficial owner within the meaning of the Statutory Trust Act.




          “Indemnified Person” means a Company Indemnified Person or a Fiduciary Indemnified
Person.




          “Indenture” means the Indenture, dated as of                     , 20       (as supplemented
from time to time), between the Debenture Issuer and the Debenture Trustee, pursuant to which the
Debentures are to be issued.




          “Institutional Trustee” means the Trustee meeting the eligibility requirements set
forth in Section 5.3.




          “Institutional Trustee Account” has the meaning set forth in Section 3.8(c).




          “Investment Company” means an investment company as defined in the Investment Company
Act.




          “Investment Company Act” means the Investment Company Act of 1940, as amended from
time to time, or any successor legislation.




          “Investment Company Event” has the meaning set forth in Annex I hereto.




          “Legal Action” has the meaning set forth in Section 3.6(g).




          “Majority in liquidation amount of the Securities” means, except as provided in the
terms of the Capital Securities or by the Trust Indenture Act, Holder(s) of outstanding Securities
voting together as a single class or, as the context may require, Holders of outstanding Capital
Securities or Holders of outstanding Common Securities voting separately as a class, who are the
record owners of an aggregate liquidation amount representing more than 50% of the aggregate
liquidation amount (including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid Distributions to the date upon which the voting percentages are
determined) of all outstanding Securities of the relevant class.




4









 








          “Officers’ Certificate” means, with respect to any Person, a certificate signed by two
Authorized Officers of such Person. Any Officers’ Certificate delivered with respect to compliance
with a condition or covenant provided for in this Declaration shall include:




          (a) a statement that each officer signing the Officers’ Certificate has read the covenant or
condition and the definitions relating thereto;




          (b) a brief statement of the nature and scope of the examination or investigation undertaken
by each officer in rendering the Officers’ Certificate;




          (c) a statement that each such officer has made such examination or investigation as, in such
officer’s opinion, is necessary to enable such officer to express an informed opinion as to whether
or not such covenant or condition has been complied with; and




          (d) a statement as to whether, in the opinion of each such officer, such condition or covenant
has been complied with.




          “Paying Agent” has the meaning specified in Section 3.8(h).




          “Payment Amount” has the meaning specified in Section 6.1.




          “Person” means a legal person, including any individual, corporation, estate,
partnership, joint venture, association, joint stock company, limited liability company, trust,
unincorporated association, or government or any agency or political subdivision thereof, or any
other entity of whatever nature.




          “Quorum” means any one Regular Trustee or, if there is only one Regular Trustee, such
Regular Trustee.




          “Regular Trustee” has the meaning specified in Section 5.1.




          “Regulatory Capital Event” has the meaning set forth in Annex I hereto.




          “Related Party” means, with respect to the Sponsor, any direct or indirect wholly
owned subsidiary of the Sponsor or any other Person that owns, directly or indirectly, 100% of the
outstanding voting securities of the Sponsor.




          “Responsible Officer” means, with respect to the Institutional Trustee, any officer
within the Corporate Trust Office of the Institutional Trustee with direct responsibility for the
administration of this Declaration and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of that officer’s knowledge of
and familiarity with the particular subject.




          “Rule 3a-5” means Rule 3a-5 under the Investment Company Act.




          “Securities” means the Common Securities and the Capital Securities.




5









 








          “Securities Act” means the Securities Act of 1933, as amended from time to time, or
any successor legislation.




          “Special Event” has the meaning set forth in Annex I hereto.




          “Sponsor” means Citigroup Inc. or any successor entity in a merger, consolidation or
amalgamation, in its capacity as sponsor of the Trust.




          “Statutory Trust Act” means Chapter 38 of Title 12 of the Delaware Code, 12 Del. Code
§3801 et seq., as it may be amended from time to time, or any successor legislation.




          “Successor Delaware Trustee” has the meaning set forth in Section 5.6.




          “Successor Entity” has the meaning set forth in Section 3.15(b).




          “Successor Institutional Trustee” has the meaning set forth in Section 5.6.




          “Successor Securities” has the meaning set forth in Section 3.15(b).




          “Super Majority” has the meaning set forth in Section 2.6(a)(ii).




          “Tax Event” has the meaning set forth in Annex I hereto.




          “10% in liquidation amount of the Securities” means, except as provided in the terms
of the Capital Securities or by the Trust Indenture Act, Holder(s) of outstanding Securities voting
together as a single class or, as the context may require, Holders of outstanding Capital
Securities or Holders of outstanding Common Securities voting separately as a class, who are the
record owners of an aggregate liquidation amount representing 10% or more of the aggregate
liquidation amount (including the stated amount that would be paid on redemption, liquidation or
otherwise, plus accrued and unpaid Distributions to the date upon which the voting percentages are
determined) of all outstanding Securities of the relevant class.




          “Treasury Regulations” means the income tax regulations, including temporary and
proposed regulations, promulgated under the Code by the United States Treasury, as such regulations
may be amended from time to time (including corresponding provisions of succeeding regulations).




          “Trustee” or “Trustees” means each Person who has signed this Declaration as a
trustee, so long as such Person shall continue in office in accordance with the terms hereof, and
all other Persons who may from time to time be duly appointed, qualified and serving as Trustees in
accordance with the provisions hereof, and references herein to a Trustee or the Trustees shall
refer to such Person or Persons solely in their capacity as trustees hereunder.




          “Trust Indenture Act” means the Trust Indenture Act of 1939, as amended from time to
time, or any successor legislation.




          “Underwriting
Agreement” means the Underwriting Agreement for the offering and sale of
Capital Securities in the form of Exhibit C.




6









 








ARTICLE II

TRUST INDENTURE ACT




SECTION 2.1 Trust Indenture Act; Application.




          (a) This Declaration is subject to the provisions of the Trust Indenture Act that are required
to be part of this Declaration and shall, to the extent applicable, be governed by such provisions.




          (b) The Institutional Trustee shall be the only Trustee that is a Trustee for the purposes of
the Trust Indenture Act.




          (c) If and to the extent that any provision of this Declaration limits, qualifies or conflicts
with the duties imposed by §§ 310 to 317, inclusive, of the Trust Indenture Act, such imposed
duties shall control.




          (d) The application of the Trust Indenture Act to this Declaration shall not affect the nature
of the Securities as equity securities representing undivided beneficial interests in the assets of
the Trust.




SECTION 2.2 Lists of Holders of Securities.




          (a) Each of the Sponsor and the Regular Trustees on behalf of the Trust shall provide the
Institutional Trustee (i) within 14 days after each record date for payment of Distributions, a
list, in such form as the Institutional Trustee may reasonably require, of the names and addresses
of the Holders of the Securities (“List of Holders”) as of such record date, provided, that neither
the Sponsor nor the Regular Trustees on behalf of the Trust shall be obligated to provide such List
of Holders at any time the List of Holders does not differ from the most recent List of Holders
given to the Institutional Trustee by the Sponsor and the Regular Trustees on behalf of the Trust,
and (ii) at any other time, within 30 days of receipt by the Trust of a written request for a List
of Holders as of a date no more than 14 days before such List of Holders is given to the
Institutional Trustee. The Institutional Trustee shall preserve, in as current a form as is
reasonably practicable, all information contained in Lists of Holders given to it or which it
receives in the capacity as Paying Agent (if acting in such capacity), provided, that the
Institutional Trustee may destroy any List of Holders previously given to it on receipt of a new
List of Holders.




          (b) The Institutional Trustee shall comply with its obligations under §§ 311(a), 311(b) and
312(b) of the Trust Indenture Act.




SECTION 2.3 Reports by the Institutional Trustee.




          Within 60 days after May 15 of each year, the Institutional Trustee shall provide to the
Holders of the Capital Securities such reports as are required by § 313 of the Trust Indenture Act,
if any, in the form and in the manner provided by § 313 of the Trust Indenture Act. The
Institutional Trustee shall also comply with the requirements of § 313(d) of the Trust Indenture
Act.




7









 








SECTION 2.4 Periodic Reports to Institutional Trustee.




          Each of the Sponsor and the Regular Trustees on behalf of the Trust shall provide to the
Institutional Trustee such documents, reports and information as required by § 314 of the Trust
Indenture Act (if any) and the compliance certificate required by § 314 of the Trust Indenture Act
in the form, in the manner and at the times required by § 314 of the Trust Indenture Act.




SECTION 2.5 Evidence of Compliance with Conditions Precedent.




          Each of the Sponsor and the Regular Trustees on behalf of the Trust shall provide to the
Institutional Trustee such evidence of compliance with any conditions precedent provided for in
this Declaration that relate to any of the matters set forth in § 314(c) of the Trust Indenture
Act. Any certificate or opinion required to be given by an officer pursuant to § 314(c)(1) of the
Trust Indenture Act may be given in the form of an Officers’ Certificate.




SECTION 2.6 Defaults; Waiver.




          (a) The Holders of a Majority in liquidation amount of Capital Securities may, by vote, on
behalf of the Holders of all of the Capital Securities, waive any past Default in respect of the
Capital Securities and its consequences, provided, that if the underlying Default under the
Indenture:





     (i) is not waivable under the Indenture, the Default under the Declaration shall also
not be waivable; or




     (ii) is waivable only with the consent of holders of more than a majority in principal
amount of the Debentures (a “Super Majority”) affected thereby, only the Holders of at least
the proportion in aggregate liquidation amount of the Capital Securities that the relevant
Super Majority represents of the aggregate principal amount of the Debentures outstanding
may waive such Default in respect of the Capital Securities under the Declaration.


The foregoing provisions of this Section 2.6(a) shall be in lieu of § 316(a)(1)(B) of the Trust
Indenture Act and such § 316(a)(1)(B) of the Trust Indenture Act is hereby expressly excluded from
this Declaration and the Securities, as permitted by the Trust Indenture Act. Upon such waiver,
any such default shall cease to exist, and any Default with respect to the Capital Securities
arising therefrom shall be deemed to have been cured, for every purpose of this Declaration, but no
such waiver shall extend to any subsequent or other default or a Default with respect to the
Capital Securities or impair any right consequent thereon. Any waiver by the Holders of the
Capital Securities of a Default with respect to the Capital Securities shall also be deemed to
constitute a waiver by the Holders of the Common Securities of any such Default with respect to the
Common Securities for all purposes of this Declaration without any further act, vote, or consent of
the Holders of the Common Securities.




          (b) The Holders of a Majority in liquidation amount of the Common Securities may, by vote, on
behalf of the Holders of all of the Common Securities, waive any

8









 








past Default with respect to the Common Securities and its consequences, provided, that if the
underlying Default under the Indenture:





     (i) is not waivable under the Indenture, except where the Holders of the Common
Securities are deemed to have waived such Default under the Declaration as provided in this
Section 2.6(b), the Default under the Declaration shall also not be waivable; or




     (ii) is waivable only with the consent of a Super Majority, except where the Holders of
the Common Securities are deemed to have waived such Default under the Declaration as
provided in this Section 2.6(b), only the Holders of at least the proportion in aggregate
liquidation amount of the Common Securities that the relevant Super Majority represents of
the aggregate principal amount of the Debentures outstanding may waive such Default in
respect of the Common Securities under the Declaration;


provided, further each Holder of Common Securities will be deemed to have waived any such Default
and all Defaults with respect to the Common Securities and its consequences until all Defaults with
respect to the Capital Securities have been cured, waived or otherwise eliminated, and until such
Defaults with respect to the Capital Securities have been so cured, waived or otherwise eliminated,
the Institutional Trustee will be deemed to be acting solely on behalf of the Holders of the
Capital Securities and only the Holders of the Capital Securities will have the right to direct the
Institutional Trustee in accordance with the terms of the Securities. The foregoing provisions of
this Section 2.6(b) shall be in lieu of §§ 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act
and such §§ 316(a)(1)(A) and 316(a)(1)(B) of the Trust Indenture Act are hereby expressly excluded
from this Declaration and the Securities, as permitted by the Trust Indenture Act. Subject to the
foregoing provisions of this Section 2.6(b), upon the waiver of a Default by the Holders of a
Majority in liquidation amount of the Common Securities, any such default shall cease to exist and
any Default with respect to the Common Securities arising therefrom shall be deemed to have been
cured for every purpose of this Declaration, but no such waiver shall extend to any subsequent or
other default or Default with respect to the Common Securities or impair any right consequent
thereon.




          (c) A waiver of a Default under the Indenture by the Institutional Trustee at the direction of
the Holders of the Capital Securities, constitutes a waiver of the corresponding Default under this
Declaration. The foregoing provisions of this Section 2.6(c) shall be in lieu of § 316(a)(1)(B) of
the Trust Indenture Act and such § 316(a)(1)(B) of the Trust Indenture Act is hereby expressly
excluded from this Declaration and the Securities, as permitted by the Trust Indenture Act.




SECTION 2.7 Default; Notice.




          (a) The Institutional Trustee shall, within 90 days after the occurrence of a Default,
transmit by mail, first class postage prepaid, to the Holders of the Securities, notices of (i) all
defaults with respect to the Securities actually known to a Responsible Officer of the
Institutional Trustee, unless such defaults have been cured before the giving of such notice (the
term “defaults” for the purposes of this Section 2.7(a) being hereby defined to be a Default as
defined in the Indenture, not including any periods of grace provided for therein and irrespective

9









 






of the giving of any notice provided therein) and (ii) any notice of default received from the
Indenture Trustee with respect to the Debentures, which notice from the Institutional Trustee to
the Holders shall state that a Default under the Indenture also constitutes a Default with respect
to the Securities; provided that, except for a default in the payment of principal of (or premium,
if any) or interest on any of the Debentures or in the payment of any sinking fund installment
established for the Debentures, the Institutional Trustee shall be protected in withholding such
notice if and so long as a Responsible Officer of the Institutional Trustee in good faith
determines that the withholding of such notice is in the interests of the Holders of the
Securities.




          (b) The Institutional Trustee shall not be deemed to have knowledge of any default except:





     (i) a default under Sections 5.7(b) and 5.7(c) of the Indenture; or




     (ii) any default as to which the Institutional Trustee shall have received written
notice or of which a Responsible Officer of the Institutional Trustee charged with the
administration of the Declaration shall have actual knowledge.



ARTICLE III

ORGANIZATION




SECTION 3.1 Name.




          The
Trust is named “Citigroup Capital XXXI,” as such name may be modified from time to time by
the Regular Trustees following written notice to the Institutional Trustee, the Delaware Trustee
and the Holders of Securities. The Trust’s activities may be conducted under the name of the Trust
or any other name deemed advisable by the Regular Trustees.




SECTION 3.2 Office.




          The address of the principal office of the Trust is c/o Citigroup Inc., 399 Park Avenue, New
York, NY 10043. On ten Business Days written notice to the Institutional Trustee, the Delaware
Trustee and the Holders of Securities, the Regular Trustees may designate another principal office.




SECTION 3.3 Purpose.




          The exclusive purposes and functions of the Trust are (a) to issue and sell Securities and use
the proceeds from such sale to acquire the Debentures, and (b) except as otherwise limited herein,
to engage in only those other activities necessary, or incidental thereto. The Trust shall not
borrow money, issue debt or reinvest proceeds derived from investments, pledge any of its assets,
or otherwise undertake (or permit to be undertaken) any activity that would cause the Trust not to
be classified for United States federal income tax purposes as a grantor trust.




SECTION 3.4 Authority.




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          Subject to the limitations provided in this Declaration and to the specific duties of the
Institutional Trustee, the Regular Trustees shall have exclusive and complete authority to carry
out the purposes of the Trust. An action taken by the Regular Trustees in accordance with their
powers shall constitute the act of and serve to bind the Trust and an action taken by the
Institutional Trustee on behalf of the Trust in accordance with its powers shall constitute the act
of and serve to bind the Trust. In dealing with the Trustees acting on behalf of the Trust, no
person shall be required to inquire into the authority of the Trustees to bind the Trust. Persons
dealing with the Trust are entitled to rely conclusively on the power and authority of the Trustees
as set forth in this Declaration.




SECTION 3.5 Title to Property of the Trust.




          Except as provided in Section 3.8 with respect to the Debentures and the Institutional Trustee
Account or as otherwise provided in this Declaration, legal title to all assets of the Trust shall
be vested in the Trust. The Holders shall not have legal title to any part of the assets of the
Trust, but shall have an undivided beneficial interest in the assets of the Trust.




SECTION 3.6 Powers and Duties of the Regular Trustees.




          The Regular Trustees shall have the exclusive power, duty and authority to cause the Trust to
engage in the following activities:




          (a) to issue and sell the Capital Securities and the Common Securities in accordance with this
Declaration; provided, however, that the Trust may issue no more than one series of Capital
Securities and no more than one series of Common Securities, and, provided further, that there
shall be no interests in the Trust other than the Securities, and the issuance of Securities shall
be limited to a simultaneous issuance of both Capital Securities and Common Securities on the
Closing Date;




          (b) in connection with the issue and sale of the Capital Securities, at the direction of the
Sponsor, to:





     (i) execute and file with the Commission on behalf of the Trust a registration
statement on Form S-3 or on another appropriate form, or a registration statement under Rule
462(b) of the Securities Act, in each case prepared by the Sponsor, including any
pre-effective or post-effective amendments thereto, relating to the registration under the
Securities Act of the Capital Securities;




     (ii) execute and file any documents prepared by the Sponsor, or take any acts as
determined by the Sponsor to be necessary in order to qualify or register all or part of the
Capital Securities in any State in which the Sponsor has determined to qualify or register
such Capital Securities for sale;




     (iii) execute and file an application, prepared by the Sponsor, to the New York Stock
Exchange, Inc., any other national stock exchange or the Nasdaq National Market for listing
upon notice of issuance of any Capital Securities;



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     (iv) execute and file with the Commission on behalf of the Trust a registration
statement on Form 8-A, prepared by the Sponsor, including any pre-effective or
post-effective amendments thereto, relating to the registration of the Capital Securities
under Section 12(b) of the Exchange Act; and




     (v) deliver the Underwriting Agreement providing for the sale of the Capital
Securities;



          (c) to acquire the Debentures with the proceeds of the sale of the Capital Securities and the
Common Securities; provided, however, that the Regular Trustees shall cause legal title to the
Debentures to be held of record in the name of the Institutional Trustee for the benefit of the
Holders of the Capital Securities and the Holders of Common Securities;




          (d) to give the Sponsor and the Institutional Trustee prompt written notice of the occurrence
of a Special Event; provided, that the Regular Trustees shall consult with the Sponsor and the
Institutional Trustee before taking or refraining from taking any ministerial action in relation to
a Special Event;




          (e) to establish a record date with respect to all actions to be taken hereunder that require
a record date be established, including and with respect to, for the purposes of §316(c) of the
Trust Indenture Act, Distributions, voting rights, redemptions and exchanges, and to issue relevant
notices to the Holders of Capital Securities and Holders of Common Securities as to such actions
and applicable record dates;




          (f) to take all actions and perform such duties as may be required of the Regular Trustees
pursuant to the terms of the Securities;




          (g) to bring or defend, pay, collect, compromise, arbitrate, resort to legal action, or
otherwise adjust claims or demands of or against the Trust (“Legal Action”), unless pursuant to
Section 3.8(e), the Institutional Trustee has the exclusive power to bring such Legal Action;




          (h) to employ or otherwise engage employees and agents (who may be designated as officers with
titles) and managers, contractors, advisors, and consultants and pay reasonable compensation for
such services;




          (i) to cause the Trust to comply with the Trust’s obligations under the Trust Indenture Act;




          (j) to give the certificate required by § 314(a)(4) of the Trust Indenture Act to the
Institutional Trustee, which certificate may be executed by any Regular Trustee;




          (k) to incur expenses that are necessary or incidental to carry out any of the purposes of the
Trust;




          (l) to act as, or appoint another Person to act as, registrar and transfer agent for the
Securities;




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          (m) to give prompt written notice to the Holders of the Securities of any notice received from
the Debenture Issuer of its election to defer payments of interest on the Debentures by extending
the interest payment period under the Indenture;




          (n) to take all action that may be necessary or appropriate for the preservation and the
continuation of the Trust’s valid existence, rights, franchises and privileges as a statutory
statutory trust under the laws of the State of Delaware and of each other jurisdiction in which
such existence is necessary to protect the limited liability of the Holders of the Capital
Securities or to enable the Trust to effect the purposes for which the Trust was created;




          (o) to take any action, not inconsistent with this Declaration or with applicable law, that
the Regular Trustees determine in their discretion to be necessary or desirable in carrying out the
activities of the Trust as set out in this Section 3.6, including, but not limited to:





     (i) causing the Trust not to be deemed to be an Investment Company required to
be registered under the Investment Company Act;




     (ii) causing the Trust to be classified for United States federal income tax
purposes as a grantor trust; and




     (iii) cooperating with the Debenture Issuer to ensure that the Debentures will
be treated as indebtedness of the Debenture Issuer for United States federal income
tax purposes;


provided, that any such action does not adversely affect the interests of Holders;




          (p) to take all action necessary to cause all applicable tax returns and tax information
reports that are required to be filed with respect to the Trust to be duly prepared and filed by
the Regular Trustees, on behalf of the Trust; and




          (q) to execute all documents or instruments, perform all duties and powers, and do all things
for and on behalf of the Trust in all matters necessary or incidental to the foregoing.




          The Regular Trustees must exercise the powers set forth in this Section 3.6 in a manner that
is consistent with the purposes and functions of the Trust set out in Section 3.3, and the Regular
Trustees shall not take any action that is inconsistent with the purposes and functions of the
Trust set forth in Section 3.3.




          Subject to this Section 3.6, the Regular Trustees shall have none of the powers or the
authority of the Institutional Trustee set forth in Section 3.8.




          Any expenses incurred by the Regular Trustees pursuant to this Section 3.6 shall be reimbursed
by the Debenture Issuer.




SECTION 3.7 Prohibition of Actions by the Trust and the Trustees.




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          (a) The Trust shall not, and the Trustees (including the Institutional Trustee) shall not
cause the Trust to, engage in any activity other than as required or authorized by this
Declaration. In particular, the Trust shall not:





     (i) invest any proceeds received by the Trust from holding the Debentures, but shall
promptly distribute all such proceeds to Holders of Securities pursuant to the terms of this
Declaration and of the Securities;




     (ii) acquire any assets other than as expressly provided herein;




     (iii) possess Trust property for other than a Trust purpose;




     (iv) make any loans or incur any indebtedness;




     (v) possess any power or otherwise act in such a way as to vary the Trust assets or the
terms of the Securities in any way whatsoever;




     (vi) issue any securities or other evidences of beneficial ownership of, or beneficial
interest in, the Trust other than the Securities; or




     (vii) other than as provided in this Declaration or Annex I, (A) direct the time,
method and place of exercising any trust or power conferred upon the Debenture Trustee with
respect to the Debentures, (B) waive any past Default that is waivable under the Indenture,
(C) exercise any right to rescind or annul any declaration that the principal of all the
Debentures shall be due and payable or (D) consent to any amendment, modification or
termination of the Indenture or the Debentures where such consent shall be required unless
the Trust shall have obtained an opinion of nationally recognized independent tax counsel
experienced in such matters to the effect that as a result of such action, the Trust will
not fail to be classified as a grantor trust for United States federal income tax purposes.



SECTION 3.8 Powers and Duties of the Institutional Trustee.




          (a) The legal title to the Debentures shall be owned by and held of record in the name of the
Institutional Trustee in trust for the benefit of the Holders of the Securities. The right, title
and interest of the Institutional Trustee to the Debentures shall vest automatically in each Person
who may hereafter be appointed as Institutional Trustee in accordance with Section 5.6. Such
vesting and cessation of title shall be effective whether or not conveyancing documents with regard
to the Debentures have been executed and delivered.




          (b) The Institutional Trustee shall not transfer its right, title and interest in the
Debentures to the Regular Trustees or to the Delaware Trustee (if the Institutional Trustee does
not also act as Delaware Trustee).




          (c) The Institutional Trustee shall:





     (i) establish and maintain a segregated non-interest bearing trust account (the
“Institutional Trustee Account”) in the name of and under the exclusive control of the



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Institutional Trustee on behalf of the Holders of the Securities and, upon the receipt
of payments of funds made in respect of the Debentures held by the Institutional Trustee,
deposit such funds into the Institutional Trustee Account and make payments to the Holders
of the Capital Securities and Holders of the Common Securities from the Institutional
Trustee Account in accordance with Section 6.1. Funds in the Institutional Trustee Account
shall be held uninvested until disbursed in accordance with this Declaration. The
Institutional Trustee Account shall be an account that is maintained with a banking
institution the rating on whose long-term unsecured indebtedness assigned by a “nationally
recognized statistical rating organization,” as that term is defined for purposes of Rule
436(g)(2) under the Securities Act, is at least equal to the rating assigned to the Capital
Securities by a nationally recognized statistical rating organization;




     (ii) engage in such ministerial activities as shall be necessary or appropriate to
effect the redemption of the Capital Securities and the Common Securities to the extent the
Debentures are redeemed or mature; and




     (iii) upon written notice of distribution issued by the Regular Trustees in accordance
with the terms of the Securities, engage in such ministerial activities as shall be
necessary or appropriate to effect the distribution of the Debentures to Holders of
Securities upon the occurrence of certain Special Events or other specified circumstances
pursuant to the terms of the Securities.



          (d) The Institutional Trustee shall take all actions and perform such duties as may be
specifically required of the Institutional Trustee pursuant to the terms of the Securities.




          (e) Subject to Section 2.6, the Institutional Trustee shall take any Legal Action which arises
out of or in connection with a Default of which a Responsible Officer of the Institutional Trustee
has actual knowledge or the Institutional Trustee’s duties and obligations under this Declaration
or the Trust Indenture Act.




          (f) The Institutional Trustee shall not resign as a Trustee unless either:





     (i) the Trust has been completely liquidated and the proceeds of the liquidation
distributed to the Holders of Securities pursuant to the terms of the Securities; or




     (ii) a Successor Institutional Trustee has been appointed and has accepted that
appointment in accordance with Section 5.6.



          (g) The Institutional Trustee shall have the legal power to exercise all of the rights, powers
and privileges of a holder of Debentures under the Indenture and, if a Default actually known to a
Responsible Officer of the Institutional Trustee occurs and is continuing, the Institutional
Trustee shall, for the benefit of Holders of the Securities, enforce its rights as holder of the
Debentures subject to the rights of the Holders pursuant to the terms of such Securities, this
Declaration, the Statutory Trust Act and the Trust Indenture Act.




15









 








          (h) The Institutional Trustee may authorize one or more Persons (each, a “Paying Agent”) to
pay Distributions, redemption payments or liquidation payments on behalf of the Trust with respect
to all securities and any such Paying Agent shall comply with § 317(b) of the Trust Indenture Act.
Any Paying Agent may be removed by the Institutional Trustee at any time and a successor Paying
Agent or additional Paying Agents may be appointed at any time by the Institutional Trustee.




          (i) Subject to this Section 3.8, the Institutional Trustee shall have none of the duties,
liabilities, powers or the authority of the Regular Trustees set forth in Section 3.6.




          The Institutional Trustee must exercise the powers set forth in this Section 3.8 in a manner
that is consistent with the purposes and functions of the Trust set out in Section 3.3, and the
Institutional Trustee shall not take any action that is inconsistent with the purposes and
functions of the Trust set out in Section 3.3.




SECTION 3.9 Certain Duties and Responsibilities of the Institutional Trustee.




          (a) The Institutional Trustee, before the occurrence of any Default and after the curing of
all Defaults that may have occurred, shall undertake to perform only such duties as are
specifically set forth in this Declaration and no implied covenants shall be read into this
Declaration against the Institutional Trustee. In case a Default has occurred (that has not been
cured or waived pursuant to Section 2.6) of which a Responsible Officer of the Institutional
Trustee has actual knowledge, the Institutional Trustee shall exercise such of the rights and
powers vested in it by this Declaration, and use the same degree of care and skill in the exercise
of such rights and powers, as a prudent person would exercise or use under the circumstances in the
conduct of his or her own affairs.




          (b) No provision of this Declaration shall be construed to relieve the Institutional Trustee
from liability for its own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:





     (i) prior to the occurrence of a Default and after the curing or waiving of all such
Defaults that may have occurred:




     (A) the duties and obligations of the Institutional Trustee shall be determined
solely by the express provisions of this Declaration and the Institutional Trustee
shall not be liable except for the performance of such duties and obligations as are
specifically set forth in this Declaration, and no implied covenants or obligations
shall be read into this Declaration against the Institutional Trustee; and




     (B) in the absence of bad faith on the part of the Institutional Trustee, the
Institutional Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon any certificates or opinions
furnished to the Institutional Trustee and conforming to the requirements of this
Declaration; but in the case of any such certificates or opinions that by any
provision hereof are specifically required to be furnished to the Institutional



16









 







Trustee, the Institutional Trustee shall be under a duty to examine the same to
determine whether or not they conform to the requirements of this Declaration;




     (ii) the Institutional Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer of the Institutional Trustee, unless it shall be proved
that the Institutional Trustee was negligent in ascertaining the pertinent facts;




     (iii) the Institutional Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the Holders of
not less than a Majority in liquidation amount of the Securities relating to the time,
method and place of conducting any proceeding for any remedy available to the Institutional
Trustee, or exercising any trust or power conferred upon the Institutional Trustee under
this Declaration;




     (iv) no provision of this Declaration shall require the Institutional Trustee to expend
or risk its own funds or otherwise incur personal financial liability in the performance of
any of its duties or in the exercise of any of its rights or powers, if it shall have
reasonable grounds for believing that the repayment of such funds or liability is not
reasonably assured to it under the terms of this Declaration or indemnity reasonably
satisfactory to the Institutional Trustee against such risk or liability is not reasonably
assured to it;




     (v) the Institutional Trustee’s sole duty with respect to the custody, safe keeping and
physical preservation of the Debentures and the Institutional Trustee Account shall be to
deal with such property in a similar manner as the Institutional Trustee deals with similar
property for its own account, subject to the protections and limitations on liability
afforded to the Institutional Trustee under this Declaration and the Trust Indenture Act;




     (vi) the Institutional Trustee shall have no duty or liability for or with respect to
the value, genuineness, existence or sufficiency of the Debentures or the payment of any
taxes or assessments levied thereon or in connection therewith;




     (vii) the Institutional Trustee shall not be liable for any interest on any money
received by it except as it may otherwise agree with the Sponsor. Money held by the
Institutional Trustee need not be segregated from other funds held by it except in relation
to the Institutional Trustee Account maintained by the Institutional Trustee pursuant to
Section 3.8(c)(i) and except to the extent otherwise required by law; and




     (viii) the Institutional Trustee shall not be responsible for monitoring the compliance
by the Regular Trustees or the Sponsor with their respective duties under this Declaration,
nor shall the Institutional Trustee be liable for any default or misconduct of the Regular
Trustees or the Sponsor.



SECTION 3.10 Certain Rights of Institutional Trustee.




          (a) Subject to the provisions of Section 3.9:




17









 









     (i) the Institutional Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be genuine and to have
been signed, sent or presented by the proper party or parties;




     (ii) any direction or act of the Sponsor or the Regular Trustees contemplated by this
Declaration shall be sufficiently evidenced by an Officers’ Certificate;




     (iii) whenever in the administration of this Declaration, the Institutional Trustee
shall deem it desirable that a matter be proved or established before taking, suffering or
omitting any action hereunder, the Institutional Trustee (unless other evidence is herein
specifically prescribed) may, in the absence of bad faith on its part, request and
conclusively rely upon an Officers’ Certificate which, upon receipt of such request, shall
be promptly delivered by the Sponsor or the Regular Trustees;




     (iv) the Institutional Trustee shall have no duty to see to any recording, filing or
registration of any instrument (including any financing or continuation statement or any
filing under tax or securities laws) or any rerecording, refiling or registration thereof;




     (v) the Institutional Trustee may consult with counsel or other experts and the advice
or opinion of such counsel and experts with respect to legal matters or advice within the
scope of such experts’ area of expertise shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder in good faith
and in accordance with such advice or opinion, such counsel may be counsel to the Sponsor or
any of its Affiliates, and may include any of its employees. The Institutional Trustee
shall have the right at any time to seek instructions concerning the administration of this
Declaration from any court of competent jurisdiction;




     (vi) the Institutional Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Declaration at the request or direction of any Holder,
unless such Holder shall have provided to the Institutional Trustee security and indemnity,
reasonably satisfactory to the Institutional Trustee, against the costs, expenses (including
attorneys’ fees and expenses and the expenses of the Institutional Trustee’s agents,
nominees or custodians) and liabilities that might be incurred by it in complying with such
request or direction, including such reasonable advances as may be requested by the
Institutional Trustee provided that nothing contained in this Section 3.10(a)(vi) shall be
taken to relieve the Institutional Trustee, upon the occurrence of a Default, of its
obligation to exercise the rights and powers vested in it by this Declaration;




     (vii) the Institutional Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture, note, other evidence of
indebtedness or other paper or document, but the Institutional Trustee, in its discretion,
may make such further inquiry or investigation into such facts or matters as it may see fit;



18









 






     (viii) the Institutional Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents, custodians, nominees
or attorneys and the Institutional Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it hereunder;




     (ix) any action taken by the Institutional Trustee or its agents hereunder shall bind
the Trust and the Holders of the Securities, and the signature of the Institutional Trustee
or its agents alone shall be sufficient and effective to perform any such action and no
third party shall be required to inquire as to the authority of the Institutional Trustee to
so act or as to its compliance with any of the terms and provisions of this Declaration,
both of which shall be conclusively evidenced by the Institutional Trustee’s or its agent’s
taking such action;




     (x) whenever in the administration of this Declaration the Institutional Trustee shall
deem it desirable to receive instructions with respect to enforcing any remedy or right or
taking any other action hereunder, the Institutional Trustee (i) may request instructions
from the Holders of the Securities which instructions may only be given by the Holders of
the same proportion in liquidation amount of the Securities as would be entitled to direct
the Institutional Trustee under the terms of the Securities in respect of such remedy, right
or action, (ii) may refrain from enforcing such remedy or right or taking such other action
until such instructions are received, and (iii) shall be protected in conclusively relying
on or acting in or accordance with such instructions; and




     (xi) except as otherwise expressly provided by this Declaration, the Institutional
Trustee shall not be under any obligation to take any action that is discretionary under the
provisions of this Declaration.



          (b) No provision of this Declaration shall be deemed to impose any duty or obligation on the
Institutional Trustee to perform any act or acts or exercise any right, power, duty or obligation
conferred or imposed on it, in any jurisdiction in which it shall be illegal, or in which the
Institutional Trustee shall be unqualified or incompetent in accordance with applicable law, to
perform any such act or acts, or to exercise any such right, power, duty or obligation. No
permissive power or authority available to the Institutional Trustee shall be construed to be a
duty.




SECTION 3.11 Delaware Trustee.




          The Delaware Trustee is appointed to serve as the trustee of the Trust in the State of
Delaware for the sole purpose of satisfying the requirement of Section 3807(a) of the Statutory
Trust Act that the Trust have at least one trustee with a principal place of business in the State
of Delaware. It is understood and agreed by the parties hereto that the Delaware Trustee shall
have none of the duties or liabilities of the Regular Trustees or the Institutional Trustee. The
duties of the Delaware Trustee shall be limited to (i) accepting legal process served on the Trust
in the State of Delaware and (ii) the execution of any certificates required to be filed with the
Delaware Secretary of State which the Delaware Trustee is required to execute under Section 3811 of
the Statutory Trust Act. To the extent that, at law or in equity, the Delaware

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Trustee has duties (including fiduciary duties) and liabilities relating thereto to the Trust
or the Holders, it is hereby understood and agreed by the other parties hereto that such duties and
liabilities are replaced by the duties and liabilities of the Delaware Trustee expressly set forth
in this Declaration. The Delaware trustee shall have no liability for the acts or omissions of the
Regular Trustees or the Institutional Trustee. The Delaware Trustee shall be entitled to all of the
same rights, protections, indemnities and immunities under this Declaration and with respect to the
Trust as the Institutional Trustee.




SECTION 3.12 Execution of Documents.




          Unless otherwise determined by the Regular Trustees, and except as otherwise required by the
Statutory Trust Act, any Regular Trustee is authorized to execute on behalf of the Trust any
documents that the Regular Trustees have the power and authority to execute pursuant to Section
3.6; provided, that the registration statement referred to in Section 3.6(b)(i), including any
amendments thereto, shall be signed by all of the Regular Trustees.




SECTION 3.13 Not Responsible for Recitals or Issuance of Securities.




          The recitals contained in this Declaration and the Securities shall be taken as the statements
of the Sponsor, and the Trustees do not assume any responsibility for their correctness. The
Trustees make no representations as to the value or condition of the property of the Trust or any
part thereof. The Trustees make no representations as to the validity or sufficiency of this
Declaration or the Securities.




SECTION 3.14 Duration of Trust.




          The Trust, unless dissolved and terminated pursuant to the provisions of Article VIII hereof,
shall have existence for sixty (60) years from the Closing Date.




SECTION 3.15 Mergers.




          (a) The Trust may not consolidate, amalgamate, merge with or into, or be replaced by, or
convey, transfer or lease its properties and assets substantially as an entirety to any corporation
or other body, except as described in Section 3.15(b) and (c).




          (b) The Trust may, with the consent of the Regular Trustees or, if there are more than two, a
majority of the Regular Trustees and without the consent of the Holders of the Securities, the
Delaware Trustee or the Institutional Trustee, consolidate, amalgamate, merge with or into, or be
replaced by a trust organized as such under the laws of any State; provided, that:





     (i) such successor entity (the “Successor Entity”) either:




     (A) expressly assumes all of the obligations of the Trust under the Securities;
or




     (B) substitutes for the Securities other securities having substantially the
same terms as the Capital Securities (the “Successor Securities”) so long as



20









 







the Successor Securities rank the same as the Capital Securities rank with
respect to Distributions and payments upon liquidation, redemption and otherwise;




     (ii) the Debenture Issuer expressly acknowledges a trustee of the Successor Entity that
possesses the same powers and duties as the Institutional Trustee in its capacity as the
Holder of the Debentures;




     (iii) the Capital Securities or any Successor Securities are listed, or any Successor
Securities will be listed upon notification of issuance, on any national securities exchange
or with any other organization on which the Capital Securities are then listed or quoted;




     (iv) such merger, consolidation, amalgamation or replacement does not cause the Capital
Securities (including any Successor Securities) to be downgraded by any nationally
recognized statistical rating organization;




     (v) such merger, consolidation, amalgamation or replacement does not adversely affect
the rights, preferences and privileges of the Holders of the Securities (including any
Successor Securities) in any material respect (other than with respect to any dilution of
such Holders’ interests in the new entity as a result of such merger, consolidation,
amalgamation or replacement);




     (vi) such Successor Entity has a purpose identical to that of the Trust;




     (vii) prior to such merger, consolidation, amalgamation or replacement, the Trust has
received an opinion of a nationally recognized independent counsel to the Trust experienced
in such matters to the effect that:




     (A) such merger, consolidation, amalgamation or replacement does not adversely
affect the rights, preferences and privileges of the Holders of the Securities
(including any Successor Securities) in any material respect (other than with
respect to any dilution of the Holders’ interest in the new entity); and




     (B) following such merger, consolidation, amalgamation or replacement, neither
the Trust nor the Successor Entity will be required to register as an Investment
Company; and




     (C) following such merger, consolidation, amalgamation or replacement, the
Trust (or the Successor Entity) will continue to be classified as a grantor trust
for United States federal income tax purposes; and



          (viii) the Sponsor guarantees the obligations of such Successor Entity under the
Successor Securities at least to the extent provided by the Capital Securities Guarantee.




          (c) Notwithstanding Section 3.15(b), the Trust shall not, except with the consent of Holders
of 100% in liquidation amount of the Securities, consolidate, amalgamate, merge with or into, or be
replaced by any other entity or permit any other entity to consolidate, amalgamate, merge with or
into, or replace it, if in the opinion of a nationally recognized

21









 








independent tax counsel experienced in such matters, such consolidation, amalgamation, merger
or replacement would cause the Trust or the Successor Entity to be classified as other than a
grantor trust for United States federal income tax purposes.




ARTICLE IV

SPONSOR




SECTION 4.1 Sponsor’s Purchase of Common Securities.




          On the Closing Date, the Sponsor will purchase all of the Common Securities issued by the
Trust at the same time as the Capital Securities are sold.




SECTION 4.2 Responsibilities of the Sponsor.




          In connection with the issue and sale of the Capital Securities, the Sponsor shall have the
exclusive right and responsibility to engage in the following activities:




          (a) to prepare for filing by the Trust with the Commission a registration statement on Form
S-3 or on another appropriate form, or a registration statement under Rule 462(b) of the Securities
Act, including any pre-effective or post-effective amendments thereto, relating to the registration
under the Securities Act of the Capital Securities;




          (b) to determine the States in which to take appropriate action to qualify or register for
sale all or part of the Capital Securities and to do any and all such acts, other than actions
which must be taken by the Trust, and advise the Trust of actions it must take, and prepare for
execution and filing any documents to be executed and filed by the Trust, as the Sponsor deems
necessary or advisable in order to comply with the applicable laws of any such States;




          (c) to prepare for filing by the Trust an application to the New York Stock Exchange, any
other national stock exchange or the Nasdaq National Market for listing upon notice of issuance of
any Capital Securities;




          (d) to prepare for filing by the Trust with the Commission a registration statement on Form
8-A, including any pre-effective or post-effective amendments thereto, relating to the registration
of the Capital Securities under Section 12(b) of the Exchange Act, including any amendments
thereto; and




          (e) to negotiate the terms of the Underwriting Agreement providing for the sale of the Capital
Securities.




ARTICLE V

TRUSTEES




SECTION 5.1 Number of Trustees.




          The number of Trustees initially shall be five (5), and:




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          (a) at any time before the issuance of any Securities, the Sponsor may, by written instrument,
increase or decrease the number of Trustees; and




          (b) after the issuance of any Securities, the number of Trustees may be increased or decreased
by vote of the Holders of a majority in liquidation amount of the Common Securities voting as a
class at a meeting of the Holders of the Common Securities,



provided, however, that the number of Trustees shall in no event be less than two (2); provided
further that (1) one Trustee, in the case of a natural person, shall be a person who is a resident
of the State of Delaware or that, if not a natural person, shall be an entity which has its
principal place of business in the State of Delaware (the “Delaware Trustee”); (2) there shall be
at least one Trustee who is an employee or officer of, or is affiliated with the Sponsor (a
“Regular Trustee”); and (3) one Trustee shall be the Institutional Trustee for so long as this
Declaration is required to qualify as an indenture under the Trust Indenture Act, and such Trustee
may also serve as Delaware Trustee if it meets the applicable requirements.




SECTION 5.2 Delaware Trustee.




          If required by the Statutory Trust Act, the Delaware Trustee shall be:




          (a) a natural person who is a resident of the State of Delaware; or




          (b) if not a natural person, an entity which has its principal place of business in the State
of Delaware, and otherwise meets the requirements of applicable law,



provided, that if the Institutional Trustee has its principal place of business in the State of
Delaware and otherwise meets the requirements of applicable law, then the Institutional Trustee
shall also be the Delaware Trustee and Section 3.11 shall have no application.




SECTION 5.3 Institutional Trustee; Eligibility.




          (a) There shall at all times be one Trustee that shall act as Institutional Trustee which
shall:





     (i) not be an Affiliate of the Sponsor;




     (ii) be a corporation organized and doing business under the laws of the United States
of America or any State or Territory thereof or of the District of Columbia, or a
corporation or Person permitted by the Commission to act as an institutional trustee under
the Trust Indenture Act, authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least 50 million U.S. dollars ($50,000,000), and
subject to supervision or examination by Federal, State, Territorial or District of Columbia
authority. If such corporation publishes reports of condition at least annually, pursuant
to law or to the requirements of the supervising or examining authority referred to above,
then for the purposes of this Section 5.3(a)(ii), the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published; and



23









 






     (iii) if the Trust is excluded from the definition of an Investment Company solely by
means of Rule 3a-7 and to the extent Rule 3a-7 requires a trustee having certain
qualifications to hold title to the “eligible assets” of the Trust, the Institutional
Trustee shall possess those qualifications.



          (b) If at any time the Institutional Trustee shall cease to be eligible to so act under
Section 5.3(a), the Institutional Trustee shall immediately resign in the manner and with the
effect set forth in Section 5.6(c).




          (c) If the Institutional Trustee has or shall acquire any “conflicting interest” within the
meaning of § 310(b) of the Trust Indenture Act, the Institutional Trustee and the Holders of the
Common Securities (as if such Holders were the obligor referred to in § 310(b) of the Trust
Indenture Act) shall in all respects comply with the provisions of § 310(b) of the Trust Indenture
Act.




          (d) The Capital Securities Guarantee shall be deemed to be specifically described in this
Declaration for purposes of clause (i) of the first provision contained in Section 310(b) of the
Trust Indenture Act.




          (e) The initial Institutional Trustee shall be as set forth in Section 5.5 hereof.




SECTION 5.4 Qualifications of Regular Trustees and Delaware Trustee Generally.




          Each Regular Trustee and the Delaware Trustee (unless the Institutional Trustee also acts as
Delaware Trustee) shall be either a natural person who is at least 21 years of age or a legal
entity that shall act through one or more Authorized Officers.




SECTION 5.5 Initial Trustees; Additional Powers of Regular Trustees.




          (a) The initial Regular Trustees shall be:



Saul Rosen

Eric L. Wentzel

John Gerspach



The initial Delaware Trustee shall be:



The Bank of New York (Delaware)

100 White Clay Center

Route 273

P. O. Box 6995

Newark, DE 19711

Attn: Corporate Trust Department



The initial Institutional Trustee shall be:



The Bank of New York

101 Barclay Street-8W




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New York, New York 10286




          (b) Except as expressly set forth in this Declaration and except if a meeting of the Regular
Trustees is called with respect to any matter over which the Regular Trustees have power to act,
any power of the Regular Trustees may be exercised by, or with the consent of, any one such Regular
Trustee.




          (c) Unless otherwise determined by the Regular Trustees, and except as otherwise required by
the Statutory Trust Act or applicable law, any Regular Trustee is authorized to execute on behalf
of the Trust any documents which the Regular Trustees have the power and authority to cause the
Trust to execute pursuant to Section 3.6, provided, that the registration statement referred to in
Section 3.6, including any amendments thereto, shall be signed by all of the Regular Trustees; and




          (d) a Regular Trustee may, by power of attorney consistent with applicable law, delegate to
any other natural person over the age of 21 his or her power for the purposes of signing any
documents which the Regular Trustees have power and authority to cause the Trust to execute
pursuant to Section 3.6.




SECTION 5.6 Appointment, Removal and Resignation of Trustees.




          (a) Subject to Section 5.6(b), Trustees may be appointed or removed without cause at any time:





     (i) until the issuance of any Securities, by written instrument executed by the
Sponsor; and




     (ii) in the case of the Regular Trustees, after the issuance of any Securities, by vote
of the Holders of a Majority in liquidation amount of the Common Securities voting as a
class at a meeting of the Holders of the Common Securities;




     (iii) in the case of the Institutional Trustee and the Delaware Trustee, unless a
Default shall have occurred and be continuing after the issuance of any Securities, by a
vote of the Holders of a Majority in liquidation amount of the Common Securities voting as a
class at a meeting of the Holders of the Common Securities; and




     (iv) in the case of the Institutional Trustee and the Delaware Trustee, if a Default
shall have occurred and be continuing after the issuance of the Securities, by a vote of
the Holders of a Majority in liquidation amount of the Capital Securities voting as a class
at a meeting of the Holders of the Capital Securities.



          (b) (i) The Trustee that acts as Institutional Trustee shall not be removed in accordance with
Section 5.6(a) until a successor Trustee possessing the qualifications to act as Institutional
Trustee under Section 5.3 (a “Successor Institutional Trustee”) has been appointed and has accepted
such appointment by written instrument executed by such Successor Institutional Trustee and
delivered to the Regular Trustees and the Sponsor; and




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     (ii) the Trustee that acts as Delaware Trustee shall not be removed in accordance with
Section 5.6(a) until a successor Trustee possessing the qualifications to act as Delaware
Trustee under Sections 5.2 and 5.4 (a “Successor Delaware Trustee”) has been appointed and
has accepted such appointment by written instrument executed by such Successor Delaware
Trustee and delivered to the Regular Trustees and the Sponsor.



          (c) A Trustee appointed to office shall hold office until his successor shall have been
appointed or until his death, removal or resignation. Any Trustee may resign from office (without
need for prior or subsequent accounting) by an instrument in writing signed by the Trustee and
delivered to the Sponsor and the Trust, which resignation shall take effect upon such delivery or
upon such later date as is specified therein; provided, however, that:





     (i) No such resignation of the Trustee that acts as the Institutional Trustee shall be
effective:




     (A) until a Successor Institutional Trustee has been appointed and has accepted
such appointment by instrument executed by such Successor Institutional Trustee and
delivered to the Trust, the Sponsor and the resigning Institutional Trustee; or




     (B) until the assets of the Trust have been completely liquidated and the
proceeds thereof distributed to the holders of the Securities; and




     (ii) no such resignation of the Trustee that acts as the Delaware Trustee shall be
effective until a Successor Delaware Trustee has been appointed and has accepted such
appointment by instrument executed by such Successor Delaware Trustee and delivered to the
Trust, the Sponsor and the resigning Delaware Trustee.



          (d) The Holders of the Common Securities shall use their best efforts to promptly appoint a
Successor Delaware Trustee or Successor Institutional Trustee as the case may be if the
Institutional Trustee or the Delaware Trustee delivers an instrument of resignation in accordance
with this Section 5.6.




          (e) If no Successor Institutional Trustee or Successor Delaware Trustee shall have been
appointed and accepted appointment as provided in this Section 5.6 within 60 days after delivery to
the Sponsor and the Trust of an instrument of resignation, the resigning Institutional Trustee or
Delaware Trustee, as applicable, may petition any court of competent jurisdiction for appointment
of a Successor Institutional Trustee or Successor Delaware Trustee. Such court may thereupon,
after prescribing such notice, if any, as it may deem proper and prescribe, appoint a Successor
Institutional Trustee or Successor Delaware Trustee, as the case may be.




          (f) No Institutional Trustee or Delaware Trustee shall be liable for the acts or omissions to
act of any Successor Institutional Trustee or Successor Delaware Trustee, as the case may be.




SECTION 5.7 Vacancies among Trustees.




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          If a Trustee ceases to hold office for any reason and the number of Trustees is not reduced
pursuant to Section 5.1, or if the number of Trustees is increased pursuant to Section 5.1, a
vacancy shall occur. A resolution certifying the existence of such vacancy by the Regular Trustees
or, if there are more than two, a majority of the Regular Trustees shall be conclusive evidence of
the existence of such vacancy. The vacancy shall be filled with a Trustee appointed in accordance
with Section 5.6.




SECTION 5.8 Effect of Vacancies.




          The death, resignation, retirement, removal, bankruptcy, dissolution, liquidation,
incompetence or incapacity to perform the duties of a Trustee shall not operate to annul the Trust.
Whenever a vacancy in the number of Regular Trustees shall occur, until such vacancy is filled by
the appointment of a Regular Trustee in accordance with Section 5.6, the Regular Trustees in
office, regardless of their number, shall have all the powers granted to the Regular Trustees and
shall discharge all the duties imposed upon the Regular Trustees by this Declaration.




SECTION 5.9 Meetings.




          If there is more than one Regular Trustee, meetings of the Regular Trustees shall be held from
time to time upon the call of any Regular Trustee. Regular meetings of the Regular Trustees may be
held at a time and place fixed by resolution of the Regular Trustees. Notice of any in-person
meetings of the Regular Trustees shall be hand delivered or otherwise delivered in writing
(including by facsimile, with a hard copy by overnight courier) not less than 48 hours before such
meeting. Notice of any telephonic meetings of the Regular Trustees or any committee thereof shall
be hand delivered or otherwise delivered in writing (including by facsimile, with a hard copy by
overnight courier) not less than 24 hours before a meeting. Notices shall contain a brief
statement of the time, place and anticipated purposes of the meeting. The presence (whether in
person or by telephone) of a Regular Trustee at a meeting shall constitute a waiver of notice of
such meeting except where a Regular Trustee attends a meeting for the express purpose of objecting
to the transaction of any activity on the ground that the meeting has not been lawfully called or
convened. Unless provided otherwise in this Declaration, any action of the Regular Trustees may be
taken at a meeting by vote of a majority of the Regular Trustees present (whether in person or by
telephone) and eligible to vote with respect to such matter, provided that a Quorum is present, or
without a meeting by the unanimous written consent of the Regular Trustees. In the event there is
only one Regular Trustee, any and all action of such Regular Trustee shall be evidenced by a
written consent of such Regular Trustee.




SECTION 5.10 Delegation of Power.




          (a) Any Regular Trustee may, by power of attorney consistent with applicable law, delegate to
any other natural person over the age of 21 his or her power for the purpose of executing any
documents contemplated in Section 3.6, including any registration statement or amendment thereto
filed with the Commission, or making any other governmental filing; and




27









 








          (b) the Regular Trustees shall have power to delegate from time to time to such of their
number or to officers of the Trust the doing of such things and the execution of such instruments
either in the name of the Trust or the names of the Regular Trustees or otherwise as the Regular
Trustees may deem expedient, to the extent such delegation is not prohibited by applicable law or
contrary to the provisions of the Trust, as set forth herein.




SECTION 5.11 Merger, Conversion, Consolidation or Succession to Business.




          Any corporation into which the Institutional Trustee or the Delaware Trustee, as the case may
be, may be merged or converted or with which either may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which the Institutional Trustee or the
Delaware Trustee, as the case may be, shall be a party, or any corporation succeeding to all or
substantially all the corporate trust business of the Institutional Trustee or the Delaware
Trustee, as the case may be, shall be the successor of the Institutional Trustee or the Delaware
Trustee, as the case may be, hereunder, provided such corporation shall be otherwise qualified and
eligible under this Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto.




ARTICLE VI

DISTRIBUTIONS




SECTION 6.1 Distributions.




          Holders shall receive Distributions (as defined herein) in accordance with the applicable
terms of the relevant Holder’s Securities. Distributions shall be made on the Capital Securities
and the Common Securities in accordance with the preferences set forth in their respective terms.
If and to the extent that the Debenture Issuer makes a payment of interest (including Compounded
Interest (as defined in the Indenture) and Additional Interest (as defined in the Indenture)),
premium and/or principal on the Debentures held by the Institutional Trustee (the amount of any
such payment being a “Payment Amount”), the Institutional Trustee shall and is directed to make a
distribution (a “Distribution”) of the Payment Amount to Holders.




ARTICLE VII

ISSUANCE OF SECURITIES




SECTION 7.1 General Provisions Regarding Securities.




          (a) The Regular Trustees shall on behalf of the Trust issue one class of capital securities
representing undivided beneficial interests in the assets of the Trust having such terms as are set
forth in Annex I (the “Capital Securities”) and one class of common securities representing
undivided beneficial interests in the assets of the Trust having such terms as are set forth in
Annex I (the “Common Securities”). The Trust shall issue no securities or other interests in the
assets of the Trust other than the Capital Securities and the Common Securities.




          (b) The Certificates shall be signed on behalf of the Trust by a Regular Trustee. Such
signature shall be the manual or facsimile signature of any present or any future Regular Trustee.
In case any Regular Trustee of the Trust who shall have signed any of the Securities shall cease to
be such Regular Trustee before the Certificates so signed shall be

28









 








delivered by the Trust, such Certificates nevertheless may be delivered as though the person
who signed such Certificates had not ceased to be such Regular Trustee; and any Certificate may be
signed on behalf of the Trust by such persons who, at the actual date of execution of such
Security, shall be the Regular Trustees of the Trust, although at the date of the execution and
delivery of the Declaration any such person was not such a Regular Trustee. Certificates shall be
printed, lithographed or engraved or may be produced in any other manner as is reasonably
acceptable to the Regular Trustees, as evidenced by their execution thereof, and may have such
letters, numbers or other marks of identification or designation and such legends or endorsements
as the Regular Trustees may deem appropriate, or as may be required to comply with any law or with
any rule or regulation of any stock exchange on which Securities may be listed, or to conform to
usage.




          (c) The consideration received by the Trust for the issuance of the Securities shall
constitute a contribution to the capital of the Trust and shall not constitute a loan to the Trust.




          (d) Upon issuance of the Securities as provided in this Declaration, the Securities so issued
shall be deemed to be validly issued, fully paid and non-assessable.




          (e) Every Person, by virtue of having become a Holder or a Capital Security Beneficial Owner
in accordance with the terms of this Declaration, shall be deemed to have expressly assented and
agreed to the terms of, and shall be bound by, this Declaration.




ARTICLE VIII

TERMINATION OF TRUST




SECTION 8.1 Termination of Trust.




          (a) The Trust shall terminate:





     (i) upon the bankruptcy of any Holder of the Common Securities or the Sponsor;




     (ii) upon the filing of a certificate of dissolution or its equivalent with respect to
any Holder of the Common Securities or the Sponsor; the filing of a certificate of
cancellation with respect to the Trust or the revocation of the Holder of the Common
Securities or the Sponsor’s charter and the expiration of 90 days after the date of
revocation without a reinstatement thereof;




     (iii) upon the entry of a decree of judicial dissolution of any Holder of the Common
Securities, the Sponsor or the Trust;




     (iv) Subject to obtaining any required regulatory approval, when all of the Securities
have been called for redemption and the amounts necessary for redemption thereof have been
paid to the Holders in accordance with the terms of the Securities;




     (v) Subject to obtaining any required regulatory approval, when the Trust shall have
been dissolved in accordance with the terms of the Securities upon election by



29









 







the Sponsor of its right to terminate the Trust and distribute all of the Debentures to
the Holders of Securities in exchange for all of the Securities and all of the Debentures
shall have been distributed to the Holders of Securities in accordance with such election;




     (vi) before the issuance of any Securities, with the consent of all of the Regular
Trustees and the Sponsor; or




     (vii) upon the expiration of the term of the Trust set forth in Section 3.14.



          (b) As soon as is practicable after the occurrence of an event referred to in Section 8.1(a),
and after satisfaction of liabilities to creditors of the Trust as required by applicable law,
including Section 3808 of the Statutory Trust Act, and subject to the terms set forth in Annex I,
the Delaware Trustee, when notified in writing of the completion of the winding up of the Trust in
accordance with the Statutory Trust Act, shall terminate the Trust by filing, at the expense of the
Sponsor, a certificate of cancellation with the Secretary of State of the State of Delaware.




          (c) The provisions of Section 3.9 and Article X shall survive the termination of the Trust.




ARTICLE IX

TRANSFER OF INTERESTS




SECTION 9.1 Transfer of Securities.




          (a) Securities may only be transferred, in whole or in part, in accordance with the terms and
conditions set forth in this Declaration and in the terms of the Securities. Any transfer or
purported transfer of any Security not made in accordance with this Declaration shall be null and
void.




          (b) Subject to this Article IX, Capital Securities shall be freely transferable.




          (c) Subject to this Article IX, the Sponsor and any Related Party may only transfer Common
Securities to the Sponsor or a Related Party of the Sponsor; provided, that any such transfer is
subject to the condition precedent that the transferor obtain the written opinion of nationally
recognized independent counsel experienced in such matters that such transfer would not cause more
than an insubstantial risk that:





     (i) the Trust would not be classified for United States federal income tax purposes as
a grantor trust; and




     (ii) the Trust would be an Investment Company or the transferee would become an
Investment Company.



SECTION 9.2 Transfer of Certificates.




          The Regular Trustees shall provide for the registration of Certificates and of transfers of
Certificates, which will be effected without charge but only upon payment (with such

30









 








indemnity as the Regular Trustees may require) in respect of any tax or other government
charges that may be imposed in relation to it. Upon surrender for registration of transfer of any
Certificate, the Regular Trustees shall cause one or more new Certificates to be issued in the name
of the designated transferee or transferees. Every Certificate surrendered for registration of
transfer shall be accompanied by a written instrument of transfer in form satisfactory to the
Regular Trustees duly executed by the Holder or such Holder’s attorney duly authorized in writing.
Each Certificate surrendered for registration of transfer shall be canceled by the Regular
Trustees. A transferee of a Certificate shall be entitled to the rights and subject to the
obligations of a Holder hereunder upon the receipt by such transferee of a Certificate. By
acceptance of a Certificate, each transferee shall be deemed to have agreed to be bound by this
Declaration.




SECTION 9.3 Deemed Security Holders.




          The Trustees may treat the Person in whose name any Certificate shall be registered on the
books and records of the Trust as the sole holder of such Certificate and of the Securities
represented by such Certificate for purposes of receiving Distributions and for all other purposes
whatsoever and, accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such Certificate or in the Securities represented by such Certificate on the part of
any Person, whether or not the Trust shall have actual or other notice thereof.




SECTION 9.4 Book Entry Interests.




          Unless otherwise specified in the terms of the Capital Securities, the Capital Securities
Certificates, on original issuance, will be issued in the form of one or more, fully registered,
global Capital Security Certificates (each a “Global Certificate”), to be delivered to DTC, the
initial Clearing Agency, by, or on behalf of, the Trust. Such Global Certificates shall initially
be registered on the books and records of the Trust in the name of Cede & Co., the nominee of DTC,
and no Capital Security Beneficial Owner will receive a definitive Capital Security Certificate
representing such Capital Security Beneficial Owner’s interests in such Global Certificates, except
as provided in Section 9.7. Unless and until definitive, fully registered Capital Security
Certificates (the “Definitive Capital Security Certificates”) have been issued to the Capital
Security Beneficial Owners pursuant to Section 9.7:




          (a) the provisions of this Section 9.4 shall be in full force and effect;




          (b) the Trust and the Trustees shall be entitled to deal with the Clearing Agency for all
purposes of this Declaration (including the payment of Distributions on the Global Certificates and
receiving approvals, votes or consents hereunder) as the Holder of the Capital Securities and the
sole holder of the Global Certificates and shall have no obligation to the Capital Security
Beneficial Owners;




          (c) to the extent that the provisions of this Section 9.4 conflict with any other provisions
of this Declaration, the provisions of this Section 9.4 shall control; and




          (d) the rights of the Capital Security Beneficial Owners shall be exercised only through the
Clearing Agency and shall be limited to those established by law and agreements between such
Capital Security Beneficial Owners and the Clearing Agency and/or the Clearing Agency Participants
and receive and transmit payments of Distributions on the

31









 








Global Certificates to such Clearing Agency Participants. DTC will make book entry transfers
among the Clearing Agency Participants.




SECTION 9.5 Notices to Clearing Agency.




          Whenever a notice or other communication to the Capital Security Holders is required under
this Declaration, unless and until Definitive Capital Security Certificates shall have been issued
to the Capital Security Beneficial Owners pursuant to Section 9.7, the Regular Trustees shall give
all such notices and communications specified herein to be given to the Capital Security Holders to
the Clearing Agency, and shall have no notice obligations to the Capital Security Beneficial
Owners.




SECTION 9.6 Appointment of Successor Clearing Agency.




          If any Clearing Agency elects to discontinue its services as a securities depositary with
respect to the Capital Securities, the Regular Trustees may, in their sole discretion, appoint a
successor Clearing Agency with respect to such Capital Securities.




SECTION 9.7 Definitive Capital Security Certificates.




          If:




          (a) a Clearing Agency elects to discontinue its services as a securities depositary with
respect to the Capital Securities and a successor Clearing Agency is not appointed within 90 days
after such discontinuance pursuant to Section 9.6; or




          (b) the Regular Trustees elect after consultation with the Sponsor to terminate the book entry
system through the Clearing Agency with respect to the Capital Securities,



then:




          (c) Definitive Capital Security Certificates shall be prepared by the Regular Trustees on
behalf of the Trust with respect to such Capital Securities; and




          (d) upon surrender of the Global Certificates by the Clearing Agency, accompanied by
registration instructions, the Regular Trustees shall cause Definitive Certificates to be delivered
to Capital Security Beneficial Owners in accordance with the instructions of the Clearing Agency.
Neither the Trustees nor the Trust shall be liable for any delay in delivery of such instructions
and each of them may conclusively rely on and shall be protected in relying on, said instructions
of the Clearing Agency. The Definitive Capital Security Certificates shall be printed,
lithographed or engraved or may be produced in any other manner as is reasonably acceptable to the
Regular Trustees, as evidenced by their execution thereof, and may have such letters, numbers or
other marks of identification or designation and such legends or endorsements as the Regular
Trustees may deem appropriate, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock exchange on which
Capital Securities may be listed, or to conform to usage.




SECTION 9.8 Mutilated, Destroyed, Lost or Stolen Certificates.




32









 







If:




          (a) any mutilated Certificates should be surrendered to the Regular Trustees, or if the
Regular Trustees shall receive evidence to their satisfaction of the destruction, loss or theft of
any Certificate; and




          (b) there shall be delivered to the Regular Trustees such security or indemnity as may be
required by them to keep each of them harmless.



then, in the absence of notice that such Certificate shall have been acquired by a bona fide
purchaser, any Regular Trustee on behalf of the Trust shall execute and deliver, in exchange for or
in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
denomination. In connection with the issuance of any new Certificate under this Section 9.8, the
Regular Trustees may require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection therewith. Any duplicate Certificate issued pursuant to
this Section shall constitute conclusive evidence of an ownership interest in the relevant
Securities, as if originally issued, whether or not the lost, stolen or destroyed Certificate shall
be found at any time.




ARTICLE X

LIMITATION OF LIABILITY OF HOLDERS OF

SECURITIES, TRUSTEES OR OTHERS




SECTION 10.1 Liability.




          (a) Except as expressly set forth in this Declaration, the Capital Securities Guarantee and
the terms of the Securities, the Sponsor shall not be:





     (i) personally liable for the return of any portion of the capital contributions (or
any return thereon) of the Holders of the Securities which shall be made solely from assets
of the Trust; and




     (ii) required to pay to the Trust or to any Holder of Securities any deficit upon
dissolution of the Trust or otherwise.



          (b) The Holder of the Common Securities shall be liable for all of the debts and obligations
of the Trust (other than with respect to the Securities) to the extent not satisfied out of the
Trust’s assets.




          (c) Pursuant to § 3803(a) of the Statutory Trust Act, the Holders of the Capital Securities
shall be entitled to the same limitation of personal liability extended to stockholders of private
corporations for profit organized under the General Corporation Law of the State of Delaware.




SECTION 10.2 Exculpation.




          (a) No Indemnified Person shall be liable, responsible or accountable in damages or otherwise
to the Trust or any Covered Person for any loss, damage or claim incurred

33









 








by reason of any act or omission performed or omitted by such Indemnified Person in good faith
on behalf of the Trust and in a manner such Indemnified Person reasonably believed to be within the
scope of the authority conferred on such Indemnified Person by this Declaration or by law, except
that an Indemnified Person shall be liable for any such loss, damage or claim incurred by reason of
such Indemnified Person’s gross negligence or willful misconduct with respect to such acts or
omissions.




          (b) An Indemnified Person shall be fully protected in relying in good faith upon the records
of the Trust and upon such information, opinions, reports or statements presented to the Trust by
any Person as to matters the Indemnified Person reasonably believes are within such other Person’s
professional or expert competence and who has been selected with reasonable care by or on behalf of
the Trust, including information, opinions, reports or statements as to the value and amount of the
assets, liabilities, profits, losses, or any other facts pertinent to the existence and amount of
assets from which Distributions to Holders of Securities might properly be paid.




SECTION 10.3 Fiduciary Duty.




          (a) To the extent that, at law or in equity, an Indemnified Person has duties (including
fiduciary duties) and liabilities relating thereto to the Trust or to any other Covered Person, an
Indemnified Person acting under this Declaration shall not be liable to the Trust or to any other
Covered Person for its good faith reliance on the provisions of this Declaration. The provisions
of this Declaration, to the extent that they restrict the duties and liabilities of an Indemnified
Person otherwise existing at law or in equity (other than the duties imposed on the Institutional
Trustee under the Trust Indenture Act), are agreed by the parties hereto to replace such other
duties and liabilities of such Indemnified Person.




          (b) Unless otherwise expressly provided herein:





     (i) whenever a conflict of interest exists or arises between any Covered Persons; or




     (ii) whenever this Declaration or any other agreement contemplated herein or therein
provides that an Indemnified Person shall act in a manner that is, or provides terms that
are, fair and reasonable to the Trust or any Holder of Securities,


the Indemnified Person shall resolve such conflict of interest, take such action or provide such
terms, considering in each case the relative interest of each party (including its own interest) to
such conflict, agreement, transaction or situation and the benefits and burdens relating to such
interests, any customary or accepted industry practices, and any applicable generally accepted
accounting practices or principles. In the absence of bad faith by the Indemnified Person, the
resolution, action or term so made, taken or provided by the Indemnified Person shall not
constitute a breach of this Declaration or any other agreement contemplated herein or of any duty
or obligation of the Indemnified Person at law or in equity or otherwise.




          (c) Whenever in this Declaration an Indemnified Person is permitted or required to make a
decision:




34









 









     (i) in its “discretion” or under a grant of similar authority, the Indemnified Person
shall be entitled to consider such interests and factors as it desires, including its own
interests, and shall have no duty or obligation to give any consideration to any interest of
or factors affecting the Trust or any other Person; or




     (ii) in its “good faith” or under another express standard, the Indemnified Person
shall act under such express standard and shall not be subject to any other or different
standard imposed by this Declaration or by applicable law.



SECTION 10.4 Indemnification.




          (a) (i) The Debenture Issuer shall indemnify, to the full extent permitted by law, any Company
Indemnified Person who was or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action by or in the right of the Trust) by reason of the fact that he
is or was a Company Indemnified Person against expenses (including attorneys’ fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by him in connection with
such action, suit or proceeding if he acted in good faith and in a manner he reasonably believed to
be in or not opposed to the best interests of the Trust, and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, shall not, of itself, create a presumption that the Company
Indemnified Person did not act in good faith and in a manner which he reasonably believed to be in
or not opposed to the best interests of the Trust, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that his conduct was unlawful.





     (ii) The Debenture Issuer shall indemnify, to the full extent permitted by law, any
Company Indemnified Person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the Trust to procure a
judgment in its favor by reason of the fact that he is or was a Company Indemnified Person
against expenses (including attorneys’ fees) actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit if he acted in good faith
and in a manner he reasonably believed to be in or not opposed to the best interests of the
Trust and except that no such indemnification shall be made in respect of any claim, issue
or matter as to which such Company Indemnified Person shall have been adjudged to be liable
to the Trust unless and only to the extent that the Court of Chancery of Delaware or the
court in which such action or suit was brought shall determine upon application that,
despite the adjudication of liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses which such Court of
Chancery or such other court shall deem proper.




     (iii) To the extent that a Company Indemnified Person shall be successful on the merits
or otherwise (including dismissal of an action without prejudice or the settlement of an
action without admission of liability) in defense of any action, suit or proceeding referred
to in paragraphs (i) and (ii) of this Section 10.4(a), or in defense of any claim, issue or
matter therein, he shall be indemnified, to the full extent permitted by



35









 







law, against expenses (including attorneys’ fees) actually and reasonably incurred by
him in connection therewith.




     (iv) Any indemnification under paragraphs (i) and (ii) of this Section 10.4(a) (unless
ordered by a court) shall be made by the Debenture Issuer only as authorized in the specific
case upon a determination that indemnification of the Company Indemnified Person is proper
in the circumstances because he has met the applicable standard of conduct set forth in
paragraphs (i) and (ii). Such determination shall be made (1) by the Regular Trustees by a
majority vote of a quorum consisting of such Regular Trustees who were not parties to such
action, suit or proceeding, (2) if such a quorum is not obtainable, or, even if obtainable,
if a quorum of disinterested Regular Trustees so directs, by independent legal counsel in a
written opinion, or (3) by the Common Security Holder of the Trust.




     (v) Expenses (including attorneys’ fees) incurred by a Company Indemnified Person in
defending a civil, criminal, administrative or investigative action, suit or proceeding
referred to in paragraphs (i) and (ii) of this Section 10.4(a) shall be paid by the
Debenture Issuer in advance of the final disposition of such action, suit or proceeding upon
receipt of an undertaking by or on behalf of such Company Indemnified Person to repay such
amount if it shall ultimately be determined that he is not entitled to be indemnified by the
Debenture Issuer as authorized in this Section 10.4(a). Notwithstanding the foregoing, no
advance shall be made by the Debenture Issuer if a determination is reasonably and promptly
made (i) by the Regular Trustees by a majority vote of a quorum of disinterested Regular
Trustees, (ii) if such a quorum is not obtainable, or, even if obtainable, if a quorum of
disinterested Regular Trustees so directs, by independent legal counsel in a written opinion
or (iii) the Common Security Holder of the Trust, that, based upon the facts known to the
Regular Trustees, counsel or the Common Security Holder at the time such determination is
made, such Company Indemnified Person acted in bad faith or in a manner that such person did
not believe to be in or not opposed to the best interests of the Trust, or, with respect to
any criminal proceeding, that such Company Indemnified Person believed or had reasonable
cause to believe his conduct was unlawful. In no event shall any advance be made in
instances where the Regular Trustees, independent legal counsel or Common Security Holder
reasonably determine that such person deliberately breached his duty to the Trust or its
Common or Capital Security Holders.




     (vi) The indemnification and advancement of expenses provided by, or granted pursuant
to, the other paragraphs of this Section 10.4(a) shall not be deemed exclusive of any other
rights to which those seeking indemnification and advancement of expenses may be entitled
under any agreement, vote of stockholders or disinterested directors of the Debenture Issuer
or Capital Security Holders of the Trust or otherwise, both as to action in his official
capacity and as to action in another capacity while holding such office. All rights to
indemnification under this Section 10.4(a) shall be deemed to be provided by a contract
between the Debenture Issuer and each Company Indemnified Person who serves in such capacity
at any time while this Section 10.4(a) is in effect. Any repeal or modification of this
Section 10.4(a) shall not affect any rights or obligations then existing.



36









 






     (vii) The Debenture Issuer may purchase and maintain insurance on behalf of any person
who is or was a Company Indemnified Person against any liability asserted against him and
incurred by him in any such capacity, or arising out of his status as such, whether or not
the Debenture Issuer would have the power to indemnify him against such liability under the
provisions of this Section 10.4(a).




     (viii) For purposes of this Section 10.4(a), references to “the Trust” shall include, in
addition to the resulting or surviving entity, any constituent entity (including any
constituent of a constituent) absorbed in a consolidation or merger, so that any person who
is or was a director, trustee, officer or employee of such constituent entity, or is or was
serving at the request of such constituent entity as a director, trustee, officer, employee
or agent of another entity, shall stand in the same position under the provisions of this
Section 10.4(a) with respect to the resulting or surviving entity as he would have with
respect to such constituent entity if its separate existence had continued.




     (ix) The indemnification and advancement of expenses provided by, or granted pursuant
to, this Section 10.4(a) shall, unless otherwise provided when authorized or ratified,
continue as to a person who has ceased to be a Company Indemnified Person and shall inure to
the benefit of the heirs, executors and administrators of such a person.



          (b) The Debenture Issuer agrees to indemnify the (i) Institutional Trustee, (ii) the Delaware
Trustee, (iii) any Affiliate of the Institutional Trustee and the Delaware Trustee, and (iv) any
officers, directors, shareholders, members, partners, employees, representatives, custodians,
nominees or agents of the Institutional Trustee and the Delaware Trustee (each of the Persons in
(i) through (iv) being referred to as a “Fiduciary Indemnified Person”) for, and to hold each
Fiduciary Indemnified Person harmless against, any loss, liability or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the acceptance or
administration or the trust or trusts hereunder, including the costs and expenses (including
reasonable legal fees and expenses) of defending itself against or investigating any claim or
liability in connection with the exercise or performance of any of its powers or duties hereunder.
The obligation to indemnify as set forth in this Section 10.4(b) shall survive the resignation or
removal of the Institutional Trustee or the Delaware Trustee, as the case may be, and the
satisfaction and discharge of this Declaration.




SECTION 10.5 Outside Businesses.




          Any Covered Person, the Sponsor, the Delaware Trustee and the Institutional Trustee may engage
in or possess an interest in other business ventures of any nature or description, independently or
with others, similar or dissimilar to the business of the Trust, and the Trust and the Holders of
Securities shall have no rights by virtue of this Declaration in and to such independent ventures
or the income or profits derived therefrom, and the pursuit of any such venture, even if
competitive with the business of the Trust, shall not be deemed wrongful or improper. No Covered
Person, the Sponsor, the Delaware Trustee, or the Institutional Trustee shall be obligated to
present any particular investment or other opportunity to the Trust even if such opportunity is of
a character that, if presented to the Trust, could be taken by the Trust, and any Covered Person,
the Sponsor, the Delaware Trustee and the Institutional Trustee shall have the right to take for
its own account (individually or as a partner or fiduciary) or to recommend to

37









 








others any such particular investment or other opportunity. Any Covered Person, the Delaware
Trustee and the Institutional Trustee may engage or be interested in any financial or other
transaction with the Sponsor or any Affiliate of the Sponsor, or may act as depositary for, trustee
or agent for, or act on any committee or body of holders of, securities or other obligations of the
Sponsor or its Affiliates.




ARTICLE XI

ACCOUNTING




SECTION 11.1 Fiscal Year.




          The fiscal year (“Fiscal Year”) of the Trust shall be the calendar year, or such other year as
is required by the Code.




SECTION 11.2 Certain Accounting Matters.




          (a) At all times during the existence of the Trust, the Regular Trustees shall keep, or cause
to be kept, full books of account, records and supporting documents, which shall reflect in
reasonable detail, each transaction of the Trust. The books of account shall be maintained on the
accrual method of accounting, in accordance with generally accepted accounting principles,
consistently applied. The Trust shall use the accrual method of accounting for United States
federal income tax purposes. The books of account and the records of the Trust shall be examined
by and reported upon as of the end of each Fiscal Year of the Trust by a firm of independent
certified public accountants selected by the Regular Trustees.




          (b) The Regular Trustees shall cause to be prepared and delivered to each of the Holders of
Securities, to the extent, if any, required by the Trust Indenture Act, within 90 days after the
end of each Fiscal Year of the Trust, annual financial statements of the Trust, including a balance
sheet of the Trust as of the end of such Fiscal Year, and the related statements of income or loss;




          (c) The Regular Trustees shall cause to be duly prepared and delivered to each of the Holders
of Securities, any annual United States federal income tax information statement required by the
Code, containing such information with regard to the Securities held by each Holder as is required
by the Code and the Treasury Regulations. Notwithstanding any right under the Code to deliver any
such statement at a later date, the Regular Trustees shall endeavor to deliver all such statements
within 30 days after the end of each Fiscal Year of the Trust.




          (d) The Regular Trustees shall cause to be duly prepared and filed with the appropriate taxing
authority, an annual United States federal income tax return, on a Form 1041 or such other form
required by United States federal income tax law, and any other annual income tax returns required
to be filed by the Regular Trustees on behalf of the Trust with any state or local taxing
authority.




SECTION 11.3 Banking.




          The Trust shall maintain one or more bank accounts in the name and for the sole benefit of the
Trust; provided, however, that all payments of funds in respect of the Debentures

38









 








held by the Institutional Trustee shall be made directly to the Institutional Trustee Account
and no other funds of the Trust shall be deposited in the Institutional Trustee Account. The sole
signatories for such accounts shall be designated by the Regular Trustees; provided, however, that
the Institutional Trustee shall designate the signatories for the Institutional Trustee Account.




SECTION 11.4 Withholding.




          The Trust and the Regular Trustees shall comply with all withholding requirements under United
States federal, state and local law. The Trust shall request, and the Holders shall provide to the
Trust, such forms or certificates as are necessary to establish an exemption from withholding with
respect to each Holder, and any representations and forms as shall reasonably be requested by the
Trust to assist it in determining the extent of, and in fulfilling, its withholding obligations.
The Regular Trustees shall file required forms with applicable jurisdictions and, unless an
exemption from withholding is properly established by a Holder, shall remit amounts withheld with
respect to the Holder to applicable jurisdictions. To the extent that the Trust is required to
withhold and pay over any amounts to any authority with respect to distributions or allocations to
any Holder, the amount withheld shall be deemed to be a distribution in the amount of the
withholding to the Holder. In the event of any claimed overwithholding, Holders shall be limited
to an action against the applicable jurisdiction. If the amount required to be withheld was not
withheld from actual Distributions made, the Trust may reduce subsequent Distributions by the
amount of such withholding.




ARTICLE XII

AMENDMENTS AND MEETINGS




SECTION 12.1 Amendments.




          (a) Except as otherwise provided in this Declaration or by any applicable terms of the
Securities, this Declaration may only be amended by a written instrument approved and executed by:





     (i) the Regular Trustees (or, if there are more than two Regular Trustees a majority of
the Regular Trustees);




     (ii) if the amendment affects the rights, powers, duties, obligations or immunities of
the Institutional Trustee, the Institutional Trustee; and




     (iii) if the amendment affects the rights, powers, duties, obligations or immunities of
the Delaware Trustee, the Delaware Trustee;



          (b) no amendment shall be made, and any such purported amendment shall be void and
ineffective:





     (i) unless, in the case of any proposed amendment, the Institutional Trustee shall have
first received an Officers’ Certificate from each of the Trust and the Sponsor that such
amendment is permitted by, and conforms to, the terms of this Declaration (including the
terms of the Securities);



39









 






     (ii) unless, in the case of any proposed amendment which affects the rights, powers,
duties, obligations or immunities of the Institutional Trustee, the Institutional Trustee
shall have first received:




     (A) an Officers’ Certificate from each of the Trust and the Sponsor that such
amendment is permitted by, and conforms to, the terms of this Declaration (including
the terms of the Securities); and




     (B) an opinion of counsel (who may be counsel to the Sponsor or the Trust) that
such amendment is permitted by, and conforms to, the terms of this Declaration
(including the terms of the Securities); and




     (iii) to the extent the result of such amendment would be to:




     (A) cause the Trust to fail to continue to be classified for purposes of United
States federal income taxation as a grantor trust;




     (B) reduce or otherwise adversely affect the powers of the Institutional
Trustee in contravention of the Trust Indenture Act; or




     (C) cause the Trust to be deemed to be an Investment Company required to be
registered under the Investment Company Act;



          (c) at such time after the Trust has issued any Securities that remain outstanding, any
amendment that would adversely affect the rights, privileges or preferences of any Holder of
Securities may be effected only with such additional requirements as may be set forth in the terms
of such Securities;




          (d) Section 9.1(c) and this Section 12.1 shall not be amended without the consent of all of
the Holders of the Securities;




          (e) Article IV shall not be amended without the consent of the Holders of a Majority in
liquidation amount of the Common Securities and;




          (f) the rights of the Holders of the Common Securities under Article V to increase or decrease
the number of, and appoint and remove Trustees shall not be amended without the consent of the
Holders of a Majority in liquidation amount of the Common Securities; and




          (g) subject to Section 12.1(c), this Declaration may be amended without the consent of the
Holders of the Securities to:





     (i) cure any ambiguity;




     (ii) correct or supplement any provision in this Declaration that may be defective or
inconsistent with any other provision of this Declaration;




     (iii) add to the covenants, restrictions or obligations of the Sponsor;



40









 






     (iv) to conform to any change in Rule 3a-5 or written change in interpretation or
application of Rule 3a-5 by any legislative body, court, government agency or regulatory
authority which amendment does not have a material adverse effect on the right, preferences
or privileges of the Holders; and




     (v) to modify, eliminate and add to any provision of the Declaration to such extent as
may be reasonably necessary to effectuate any of the foregoing or to otherwise comply with
applicable law.



SECTION 12.2 Meetings of the Holders of Securities; Action by Written Consent.




          (a) Meetings of the Holders of any class of Securities may be called at any time by the
Regular Trustees (or as provided in the terms of the Securities) to consider and act on any matter
on which Holders of such class of Securities are entitled to act under the terms of this
Declaration, the terms of the Securities or the rules of any stock exchange on which the Capital
Securities are listed or admitted for trading. The Regular Trustees shall call a meeting of the
Holders of such class if directed to do so by the Holders of Securities representing at least 10%
in liquidation amount of such class of Securities. Such direction shall be given by delivering to
the Regular Trustees one or more calls in a writing stating that the signing Holders of Securities
wish to call a meeting and indicating the general or specific purpose for which the meeting is to
be called. Any Holders of Securities calling a meeting shall specify in writing the Security
Certificates held by the Holders of Securities exercising the right to call a meeting and only
those Securities specified shall be counted for purposes of determining whether the required
percentage set forth in the second sentence of this paragraph has been met.




          (b) Except to the extent otherwise provided in the terms of the Securities, the following
provisions shall apply to meetings of Holders of Securities:





     (i) notice of any such meeting shall be given to all the Holders of Securities having
a right to vote thereat at least 7 days and not more than 60 days before the date of such
meeting. Whenever a vote, consent or approval of the Holders of Securities is permitted or
required under this Declaration or the rules of any stock exchange on which the Capital
Securities are listed or admitted for trading, such vote, consent or approval may be given
at a meeting of the Holders of Securities. Any action that may be taken at a meeting of
the Holders of Securities may be taken without a meeting if a consent in writing setting
forth the action so taken is signed by the Holders of Securities owning not less than the
minimum amount of Securities in liquidation amount that would be necessary to authorize or
take such action at a meeting at which all Holders of Securities having a right to vote
thereon were present and voting. Prompt notice of the taking of action without a meeting
shall be given to the Holders of Securities entitled to vote who have not consented in
writing. The Regular Trustees may specify that any written ballot submitted to the
Security Holder for the purpose of taking any action without a meeting shall be returned to
the Trust within the time specified by the Regular Trustees;




     (ii) each Holder of a Security may authorize any Person to act for it by proxy on all
matters in which a Holder of Securities is entitled to participate, including waiving
notice of any meeting, or voting or participating at a meeting. No proxy shall be valid



41









 







after the expiration of 11 months from the date thereof unless otherwise provided in
the proxy. Every proxy shall be revocable at the pleasure of the Holder of Securities
executing it. Except as otherwise provided herein, all matters relating to the giving,
voting or validity of proxies shall be governed by the General Corporation Law of the State
of Delaware relating to proxies, and judicial interpretations thereunder, as if the Trust
were a Delaware corporation and the Holders of the Securities were stockholders of a
Delaware corporation;




     (iii) each meeting of the Holders of the Securities shall be conducted by the Regular
Trustees or by such other Person that the Regular Trustees may designate; and




     (iv) unless the Statutory Trust Act, this Declaration, the terms of the Securities,
the Trust Indenture Act or the listing rules of any stock exchange on which the Capital
Securities are then listed or trading, otherwise provides, the Regular Trustees, in their
sole discretion, shall establish all other provisions relating to meetings of Holders of
Securities, including notice of the time, place or purpose of any meeting at which any
matter is to be voted on by any Holders of Securities, waiver of any such notice, action by
consent without a meeting, the establishment of a record date, quorum requirements, voting
in person or by proxy or any other matter with respect to the exercise of any such right to
vote.



ARTICLE XIII

REPRESENTATIONS OF INSTITUTIONAL TRUSTEE

AND DELAWARE TRUSTEE




SECTION 13.1 Representations and Warranties of Institutional Trustee.




          The Trustee that acts as initial Institutional Trustee represents and warrants to the Trust
and to the Sponsor at the date of this Declaration, and each Successor Institutional Trustee
represents and warrants to the Trust and the Sponsor at the time of the Successor Institutional
Trustee’s acceptance of its appointment as Institutional Trustee that:




          (a) the Institutional Trustee is a banking corporation with trust powers, duly organized,
validly existing and in good standing under the laws of the State of New York, with trust power and
authority to execute and deliver, and to carry out and perform its obligations under the terms of,
this Declaration;




          (b) the execution, delivery and performance by the Institutional Trustee of the Declaration
has been duly authorized by all necessary corporate action on the part of the Institutional
Trustee. The Declaration has been duly executed and delivered by the Institutional Trustee, and it
constitutes a legal, valid and binding obligation of the Institutional Trustee, enforceable against
it in accordance with its terms, subject to applicable bankruptcy, reorganization, moratorium,
insolvency, and other similar laws affecting creditors’ rights generally and to general principles
of equity and the discretion of the court (regardless of whether the enforcement of such remedies
is considered in a proceeding in equity or at law);




42









 








          (c) the execution, delivery and performance of the Declaration by the Institutional Trustee
does not conflict with or constitute a breach of the Articles of Organization or By-laws of the
Institutional Trustee; and




          (d) no consent, approval or authorization of, or registration with or notice to, any State or
Federal banking authority is required for the execution, delivery or performance by the
Institutional Trustee, of the Declaration.




SECTION 13.2 Representations and Warranties of Delaware Trustee.




          The Trustee that acts as initial Delaware Trustee represents and warrants to the Trust and to
the Sponsor at the date of this Declaration, and each Successor Delaware Trustee represents and
warrants to the Trust and the Sponsor at the time of the Successor Delaware Trustee’s acceptance of
its appointment as Delaware Trustee that:




          (a) The Delaware Trustee is a Delaware banking corporation with trust powers, duly organized,
validly existing and in good standing under the laws of the State of Delaware, with trust power and
authority to execute and deliver, and to carry out and perform its obligations under the terms of,
the Declaration.




          (b) The Delaware Trustee has been authorized to perform its obligations under the Certificate
of Trust and the Declaration. The Declaration under Delaware law constitutes a legal, valid and
binding obligation of the Delaware Trustee, enforceable against it in accordance with its terms,
subject to applicable bankruptcy, reorganization, moratorium, insolvency, and other similar laws
affecting creditors’ rights generally and to general principles of equity and the discretion of the
court (regardless of whether the enforcement of such remedies is considered in a proceeding in
equity or at law).




          (c) No consent, approval or authorization of, or registration with or notice to, any State or
Federal banking authority is required for the execution, delivery or performance by the Delaware
Trustee, of the Declaration.




          (d) The Delaware Trustee is an entity which maintains its principal place of business in the
State of Delaware.




ARTICLE XIV

MISCELLANEOUS




SECTION 14.1 Notices.




          All notices provided for in this Declaration shall be in writing, duly signed by the party
giving such notice, and shall be delivered, telecopied or mailed by registered or certified mail,
as follows:




43









 








          (a) if given to the Trust, in care of the Regular Trustees at the Trust’s mailing address set
forth below (or such other address as the Trust may give notice of to the Holders of the
Securities):



Citigroup
Capital XXXI

c/o Citigroup Inc.

153 East 53rd Street

New York, NY 10043

Attention: Sallie Krawcheck




          (b) if given to the Delaware Trustee, at the mailing address set forth below (or such other
address as Delaware Trustee may give notice of to the Holders of the Securities):



The Bank of New York (Delaware)

100 White Clay Center

Route 273

P. O. Box 6995

Newark, DE 19711

Attention: Corporate Trust Department




          (c) if given to the Institutional Trustee, at the mailing address set forth below (or such
other address as the Institutional Trustee may give notice of to the Holders of the Securities):



The Bank of New York

101 Barclay Street-8W

New York, New York 10286

Attn: Global Trust Administration




          (d) if given to the Holder of the Common Securities, at the mailing address of the Sponsor set
forth below (or such other address as the Holder of the Common Securities may give notice of to the
Trust):



Citigroup Inc.

153 East 53rd Street

New York, NY 10043

Attention: Charles E. Wainhouse




          (e) if given to any other Holder, at the address set forth on the books and records of the
Trust.




          All such notices shall be deemed to have been given when received in person, telecopied with
receipt confirmed, or mailed by first class mail, postage prepaid except that if a notice or other
document is refused delivery or cannot be delivered because of a changed address of which no notice
was given, such notice or other document shall be deemed to have been delivered on the date of such
refusal or inability to deliver.




44









 








SECTION 14.2 Governing Law.




          This Declaration and the rights of the parties hereunder shall be governed by and interpreted
in accordance with the laws of the State of Delaware and all rights and remedies shall be governed
by such laws without regard to principles of conflict of laws.




SECTION 14.3 Intention of the Parties.




          It is the intention of the parties hereto that the Trust be classified for United States
federal income tax purposes as a grantor trust. The provisions of this Declaration shall be
interpreted to further this intention of the parties.




SECTION 14.4 Headings.




          Headings contained in this Declaration are inserted for convenience of reference only and do
not affect the interpretation of this Declaration or any provision hereof.




SECTION 14.5 Successors and Assigns.




          Whenever in this Declaration any of the parties hereto is named or referred to, the successors
and assigns of such party shall be deemed to be included, and all covenants and agreements in this
Declaration by the Sponsor and the Trustees shall bind and inure to the benefit of their respective
successors and assigns, whether so expressed.




SECTION 14.6 Partial Enforceability.




          If any provision of this Declaration, or the application of such provision to any Person or
circumstance, shall be held invalid, the remainder of this Declaration, or the application of such
provision to Persons or circumstances other than those to which it is held invalid, shall not be
affected thereby.




SECTION 14.7 Counterparts.




          This Declaration may contain more than one counterpart of the signature page and this
Declaration may be executed by the affixing of the signature of each of the Trustees to one of such
counterpart signature pages. All of such counterpart signature pages shall be read as though one,
and they shall have the same force and effect as though all of the signers had signed a single
signature page.





45









 








          IN WITNESS WHEREOF, the undersigned have caused these presents to be executed as of the day
and year first above written.




	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	 	 	 
	 	 	Name: Gary Crittenden	 	 
	 	 	Title: Regular Trustee	 	 
	 
	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK (DELAWARE),

as Delaware Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	Name:	 	 
	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	THE BANK OF NEW YORK, as Institutional Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	Name:	 	 
	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	CITIGROUP INC., as Sponsor	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Charles E. Wainhouse	 	 
	 	 	Title: Assistant Treasurer	 	 






 









 






ANNEX I




TERMS OF

% CAPITAL SECURITIES

% COMMON SECURITIES




          Pursuant to Section 7.1 of the Amended and Restated Declaration of Trust, dated as of
                , 20 (as amended from time to time, the “Declaration”), the designation, rights, privileges,
restrictions, preferences and other terms and provisions of the Capital Securities and the Common
Securities are set out below (each capitalized term used but not defined herein has the meaning set
forth in the Declaration or, if not defined in such Declaration, as defined in the Prospectus
referred to below):




          1. Designation and Number.




          (a)
Capital Securities.       Capital Securities of the Trust with an
aggregate liquidation amount with respect to the assets of the Trust of
      dollars ($                    ), and a liquidation amount with respect to the assets of the Trust of
$25 per capital security, are hereby designated for the purposes of identification only as “          %
Capital Securities” (the “Capital Securities”). The Capital Security Certificates evidencing the
Capital Securities shall be substantially in the form of Exhibit A-1 to the Declaration, with such
changes and additions thereto or deletions therefrom as may be required by ordinary usage, custom
or practice or to conform to the rules of any stock exchange on which the Capital Securities are
listed.




          (b) Common Securities.       Common Securities of the Trust with an aggregate
liquidation amount with respect to the assets of the Trust of           dollars ($            ),
and a liquidation amount with respect to the assets of the Trust of $25 per common security, are
hereby designated for the purposes of identification only as “          % Common Securities” (the
“Common Securities”). The Common Security Certificates evidencing the Common Securities shall be
substantially in the form of Exhibit A-2 to the Declaration, with such changes and additions
thereto or deletions therefrom as may be required by ordinary usage, custom or practice.




          2. Distributions.




          (a) Distributions payable on each Security will be fixed at a rate per annum of
% (the “Coupon Rate”) of the stated liquidation amount of $25 per Security, such
rate being the rate of interest payable on the Debentures to be held by the Institutional Trustee.
Distributions in arrears beyond the first date such Distributions are payable (or would be payable,
if not for any Extension Period (as defined below) or default by the Debenture Issuer on the
Debentures) will bear interest thereon compounded quarterly at the Coupon Rate (to the extent
permitted by applicable law). The term “Distributions” as used herein includes such cash
distributions and any such interest payable unless otherwise stated. A Distribution is payable
only to the extent that payments are made in respect of the Debentures held by the Institutional
Trustee and to the extent the Institutional Trustee has funds available therefor. The amount of
Distributions payable for any period will be computed for any full quarterly Distribution period
on the basis of a 360-day year of twelve 30-day months, and for any period shorter than a full
quarterly




I-1









 







Distribution period for which Distributions are computed, Distributions will be computed on
the basis of the actual number of days elapsed per 90-day quarter.




          (b) Distributions on the Securities will be cumulative, will accrue from and including
          , 20    , and will be payable quarterly in arrears, on                     ,                    ,               
        , and            of each year, commencing on      , 20    . When, as and if
available for payment, Distributions will be made by the Institutional Trustee, except as otherwise
described below. The Debenture Issuer has the right under the Indenture to defer payments of
interest on the Debentures by extending the interest payment period from time to time on the
Debentures for a period not exceeding 40 consecutive quarters (each an “Extension Period”), during
which Extension Period no interest shall be due and payable on the Debentures, provided, that no
Extension Period may extend beyond the date of maturity of the Debentures. As a consequence of the
Debenture Issuer’s extension of the interest payment period, quarterly Distributions will also be
deferred. Despite such deferral, quarterly Distributions will continue to accrue with interest
thereon (to the extent permitted by applicable law) at the Coupon Rate compounded quarterly during
any such Extension Period. In the event that the Debenture Issuer exercises its right to extend
the interest payment period, then (a) the Debenture Issuer and any subsidiary of the Debenture
Issuer shall not declare or pay any dividend on, make any distributions with respect to, or redeem,
purchase, acquire or make a liquidation payment with respect to, any of its capital stock or make
any guarantee payment with respect thereto (other than (i) purchases, redemptions or other
acquisitions of shares of capital stock of the Debenture Issuer in connection with any employment
contract, benefit plan or other similar arrangement with or for the benefit of employees, officers,
directors or consultants, (ii) purchases of shares of common stock of the Debenture Issuer pursuant
to a contractually binding requirement to buy stock existing prior to the commencement of the
extension period, including under a contractually binding stock repurchase plan (iii) as a result
of an exchange or conversion of any class or series of the Debenture Issuer’s capital stock for any
other class or series of the Debenture Issuer’s capital stock, (iv) the purchase of fractional
interests in shares of the Debenture Issuer’s capital stock pursuant to the conversion or exchange
provisions of such capital stock or the security being converted or exchanged), or (v) the purchase
of the Debenture Issuer’s capital stock in connection with the distribution thereof; and (b) the
Debenture Issuer and any subsidiary of the Debenture Issuer will not make any payment of interest,
principal or premium on, or repay, repurchase or redeem, any debt securities or guarantees issued
by the Debenture Issuer that rank pari passu with or junior to the Debentures (other than (i) any
payment of current or deferred interest on securities that rank pari passu with the Debentures that
is made pro rata to the amounts due on such securities (including the Debentures), provided that
any such payments of deferred interest are made in accordance with the Alternative Payment
Mechanism (as defined below) or (ii) any payments of deferred interest on securities that rank pari
passu with the Debentures that, if not made, would give rise to an event of default permitting
acceleration of such securities. The foregoing, however, will not apply to any stock dividends paid
by the Debenture Issuer where the dividend stock is the same stock as that on which the dividend is
being paid. In addition, the Debenture Issuer may pay current interest at any time with cash from
any source. Prior to the termination of any such Extens
ion Period, the Debenture Issuer may further
extend such Extension Period; provided, that such Extension Period, together with all such previous
and further extensions thereof, may not exceed 40 consecutive quarters; provided further, that no
Extension Period may extend beyond the maturity of the Debentures. Payments of deferred
Distributions and accrued interest thereon will be payable to Holders as they appear




I-2









 







on the books and records of the Trust on the first record date before the end of the Extension
Period. Upon the termination of any Extension Period and the payment of all amounts then due, the
Debenture Issuer may commence a new Extension Period, subject to the above requirements. The
Regular Trustees will give notice to each Holder of any Extension Period upon their receipt of
notice thereof from the Debenture Issuer.




          (c) If the Debenture Issuer does not pay all accrued and unpaid interest on the Debentures for
a period of 20 consecutive quarterly periods or if the Debenture Issuer pays current interest on
the Debentures during an Extension Period, it will be subject to the “Alternative Payment
Mechanism,” whereby the Debenture Issuer will be obliged to continuously use its commercially
reasonable efforts to sell shares of its common stock (including treasury shares). The Debenture
Issuer will notify the Board of Governors of the Federal Reserve Bank and the Federal Reserve Bank
of New York, or its successor as the Debenture Issuer’s primary federal banking regulator
(collectively, the “Federal Reserve”) (1) of the commencement of any Extension Period, (2) of the
fifth anniversary of the commencement of an Extension period or earlier payment of current interest
on the Debentures during an Extension Period and (3) of its intention to sell shares of its common
stock and/or Qualified Warrants (as defined below) and to apply the net proceeds from such sale to
pay deferred interest on the Debentures at least 25 Business Days in advance of the relevant
payment date (or such longer period as may be required by the Federal Reserve or by other
supervisory action). The Debenture Issuer may pay accrued and unpaid interest on the Debentures on
or prior to the next interest payment date using only the net proceeds (after underwriters’ or
placement agents’ fees, commissions or discounts and other expenses relating to the issuances) of
such sales received by the Debenture Issuer during the 180-day period prior to that interest
payment date, except that the Debenture Issuer may pay accrued and unpaid interest on the
Debentures with cash from any source (i) upon the maturity of the Debentures, (ii) during the
occurrence and continuation of a Supervisory Event (as defined in the Indenture) or (iii) if an
Event of Default and Acceleration under the Indenture shall have occurred and be continuing.
Corresponding Distributions will be made on the Securities. If (1) a Supervisory Event or (2) a
Market Disruption Event (as defined in the Indenture) shall have occurred and be continuing; then
the Debenture Issuer will be excused from its obligation to use its commercially reasonable efforts
to sell its common stock and apply the net proceeds of such sale to pay accrued and unpaid interest
on the Debentures. During the occurrence of a Supervisory Event, the Debenture Issuer will, no
later than 30 Business Days prior to each interest payment date, notify the Federal Reserve of its
intention to both (1) issue or sell shares of common stock and (2) to apply the net proceeds from
such sale to pay deferred interest on the Debentures, and shall only take any such actions if the
Federal Reserve does not disapprove of any such actions within ten (10) Business Days after the
Debenture Issuer gives such notice to the Federal Reserve. The obligation of the Debenture Issuer
to use commercially reasonable efforts to sell its common stock and apply the net proceeds of such
sale to pay accrued and unpaid interest on the Debentures shall resume at such time as no Market
Disruption Event or Supervisory Event exists or is continuing. The Debenture Issuer is not
permitted to sell shares of common stock in excess of a number of shares of common stock which at
        , 20 is equal to           (the “Share Cap Amount”), for the purpose of satisfying the
Alternative Payment Mechanism or otherwise paying deferred interest on the Debentures then
outstanding. If the issued and outstanding shares of common stock shall have been changed into a
different number of shares or a different class by reason of any stock split, reverse stock split,
stock dividend, reclassification, recapitalization, split-up, combination,




I-3









 







exchange of shares or other similar transaction, then the Share Cap Amount shall be
correspondingly adjusted. The Debenture Issuer shall increase the Share Cap Amount (including
through the increase of its authorized share capital, if necessary) to an amount that would allow
the Debenture Issuer to raise sufficient proceeds to satisfy its obligations to pay deferred
interest in full at the end of the first year of an Extension Period (and on each subsequent
anniversary of the end of the first year of an Extension Period to the extent that an Extension
Period would last more than one year), if the then-current Share Cap Amount would not allow the
Debenture Issuer to raise sufficient proceeds to satisfy its obligations to pay deferred interest
(including compounded interest to that date) assuming a price per share equal to the average
trading price of the Debenture Issuer’s common shares over the ten-trading-day period preceding
such date; provided that the Debenture Issuer will not be obligated to increase the Share Cap
Amount above            shares. Until the tenth anniversary of the commencement of an Extension
Period, a Default will occur if the Debenture Issuer does not increase the Share Cap Amount to an
amount that is greater than            shares when required to do so as described above; provided that
no Default will occur if the Debenture Issuer has increased the share cap amount to
shares. The Debenture Issuer will not be obligated to issue common stock prior to the fifth
anniversary of the commencement of an Extension Period if the gross proceeds of any issuance of
common stock and Qualified Warrants applied to pay deferred interest on the Debentures pursuant to
the Alternative Payment Mechanism, together with the gross proceeds of all prior issuances of
common stock and Qualified Warrants applied since the commencement of the Extension Period, would
exceed an amount equal to 2% of the product of (1) the average of the Current Stock Market Prices
(as defined in the Indenture) of the Debenture Issuer’s common stock on the 10 consecutive trading
days ending on the fourth trading day immediately preceding the date of issuance by the Debenture
Issuer of common stock applied to pay deferred interest on the Debentures pursuant to the
Alternative Payment Mechanism and (2) the total number of issued and outstanding shares of the
Debenture Issuer’s common stock as of the date of the Debenture Issuer’s publicly available
consolidated financial statements (the “APM Maximum Obligation”). Once the Debenture Issuer reaches
the APM Maximum Obligation for an Extension Period, the Debenture Issuer will not be obligated to
issue more common stock or Qualified Warrants in satisfaction of the Alternative Payment Mechanism
prior to the fifth anniversary of the commencement of an Extension Period even if the Current Stock
Market Price of the Debenture Issuer’s common stock or the number of outstanding shares of its
common stock subsequently increase. The APM Maximum Obligation will cease to apply following the
fifth anniversary of the commencement of an Extension Period, at which point the Debenture Issuer
must repay any deferred interest, regardless of the time at which it was deferred, using proceeds
from sales of the Debenture Issuer’s common stock, including treasury shares, subject to any Market
Disruption Event, Supervisory Event, and the Share Cap Amount. If the APM Maximum Obligation has
been reached during an Extension Period and the Debenture Issuer subsequently repays all deferred
interest, the APM Maximum Obligation will cease to apply at the termination of such Extension
Period and will not apply again unless and until the Debenture Issuer starts a new Extension
Period. “Qualified Warrants” means warrants for the Debenture Issuer’s common stock on t
heir date
of issuance that (1) have an exercise price greater than the Current Stock Market Price of the
Debenture Issuer’s common stock, and (2) the Debenture Issuer is not entitled to redeem for cash
and the holders are not entitled to require the Debenture Issuer to repurchase for cash in any
circumstances.




I-4









 








          (d) Distributions on the Securities will be payable to the Holders thereof as they appear on
the books and records of the Trust at the close of business on the relevant record dates. While
the Capital Securities remain in book-entry only form, the relevant record dates shall be one
Business Day prior to the relevant payment dates which payment dates shall correspond to the
interest payment dates on the Debentures. Subject to any applicable laws and regulations and the
provisions of the Declaration, each such payment in respect of the Capital Securities will be made
as described under the heading “Description of the Capital Securities — Book-Entry Only Issuance”
in the Prospectus dated      , 20 (the “Prospectus”), of the Trust included in the
Registration Statement on Form S-3 of the Sponsor, the Trust and certain other statutory trusts.
The relevant record dates for the Common Securities shall be the same record date as for the
Capital Securities. If the Capital Securities shall not continue to remain in book-entry only
form, the relevant record dates for the Capital Securities shall conform to the rules of any
securities exchange on which the securities are listed and, if none, shall be selected by the
Regular Trustees, which dates shall be more than 14 days but less than 60 days prior to the
relevant payment dates, which payment dates shall correspond to the interest payment dates on the
Debentures. Distributions payable on any Securities that are not punctually paid on any
Distribution payment date, as a result of the Debenture Issuer having failed to make a payment
under the Debentures, will cease to be payable to the Person in whose name such Securities are
registered on the relevant record date, and such defaulted Distribution will instead be payable to
the Person in whose name such Securities are registered on the special record date or other
specified date determined in accordance with the Indenture. If any date on which Distributions are
payable on the Securities is not a Business Day, then payment of the Distribution payable on such
date will be made on the next succeeding day that is a Business Day (and without any interest or
other payment in respect of any such delay) except that, if such Business Day is in the next
succeeding calendar year, such payment shall be made on the immediately preceding Business Day, in
each case with the same force and effect as if made on such date.




          (e) In the event that there is any money or other property held by or for the Trust that is
not accounted for hereunder, such property shall be distributed Pro Rata (as defined herein) among
the Holders of the Securities.




          3. Liquidation Distribution Upon Dissolution.




          (a) In the event of any voluntary or involuntary dissolution, winding-up or termination of the
Trust, the Holders of the Securities on the date of the dissolution, winding-up or termination, as
the case may be, will be entitled to receive out of the assets of the Trust available for
distribution to Holders of Securities after satisfaction of liabilities of creditors, distributions
in an amount equal to the aggregate of the stated liquidation amount of $25 per Security plus
accrued and unpaid Distributions thereon to the date of payment (such amount being the “Liquidation
Distribution”), unless, in connection with such dissolution, winding-up or termination, Debentures
in an aggregate principal amount equal to the aggregate stated liquidation amount of, with an
interest rate equal to the Coupon Rate, and bearing accrued and unpaid interest in an amount equal
to the accrued and unpaid Distributions on, such Securities outstanding at such time, have been
distributed on a Pro Rata basis to the Holders of the Securities in exchange for such Securities.
Prior to any such Liquidation Distribution, the Debenture Issuer will obtain any required
regulatory approval.




I-5









 








          (b) If, upon any such dissolution, the Liquidation Distribution can be paid only in part
because the Trust has insufficient assets available to pay in full the aggregate Liquidation
Distribution, then the amounts payable directly by the Trust on the Securities shall be paid on a
Pro Rata basis.




          4. Redemption and Distribution.




          (a) Upon the repayment of the Debentures in whole or in part, whether at maturity or upon
redemption (either at the option of the Debenture Issuer or pursuant to a Special Event as
described below), the proceeds from such repayment or payment shall be simultaneously applied to
redeem Securities having an aggregate liquidation amount equal to the aggregate principal amount of
the Debentures so repaid or redeemed at a redemption price of $25 per Security plus an amount equal
to accrued and unpaid Distributions thereon at the date of the redemption, payable in cash (the
“Redemption Price”). Holders shall be given not less than 30 nor more than 60 days’ notice of such
redemption. Prior to any such redemption, the Debenture Issuer will obtain any required regulatory
approval.




          (b) If fewer than all the outstanding Securities are to be so redeemed, the Securities will be
redeemed Pro Rata and the Capital Securities to be redeemed will be as described in Section
4(f)(ii) below.




          (c) Subject to obtaining any required regulatory approval, if, at any time, a Tax Event, an
Investment Company Event or a Regulatory Capital Event (each as defined below, and each a “Special
Event”) shall occur and be continuing, Citigroup shall have the right, upon not less than 30 nor
more than 60 days’ notice, to redeem the Debentures, in whole or in part, for cash within 90 days
following the occurrence of such Special Event, and, following such redemption, Securities with an
aggregate liquidation amount equal to the aggregate principal amount of the Debentures so redeemed
shall be redeemed by the Trust at the Redemption Price on a Pro Rata basis; provided, however, that
if at the time there is available to Citigroup or the Trust the opportunity to eliminate, within
such 90-day period, the Special Event by taking some ministerial action, such as filing a form or
making an election or pursuing some other similar reasonable measure that will have no adverse
effect on the Trust, Citigroup or the holders of the Securities, then Citigroup or the Trust will
pursue such measure in lieu of redemption.




          “Tax Event” means that the Regular Trustees shall have received an opinion of a nationally
recognized independent tax counsel experienced in such matters (a “Tax Event Opinion”) to the
effect that, as a result of (a) any amendment to, or change (including any announced prospective
change) in, the laws (or any regulations thereunder) of the United States or any political
subdivision or taxing authority thereof or therein or (b) any amendment to, or change in, an
interpretation or application of such laws or regulations by any legislative body, court,
governmental agency or regulatory authority (including the enactment of any legislation and the
publication of any judicial decision or regulatory determination on or after the date of the
Prospectus), in either case after the date of the Prospectus, there is more than an insubstantial
risk that (i) the Trust would be subject to United States federal income tax with respect to
interest accrued or received on the Debentures, (ii) the Trust would be subject to more than a de
minimis amount of other taxes, duties or other governmental charges, or (iii) interest payable to
the Trust

I-6









 








on the Debentures would not be deductible, in whole or in part, by the Debenture Issuer for
United States federal income tax purposes.




          “Investment Company Event” means that the Regular Trustees shall have received an opinion of a
nationally recognized independent counsel experienced in practice under the Investment Company Act
(an “Investment Company Event Opinion”) to the effect that, as a result of the occurrence of a
change in law or regulation or a written change in interpretation or application of law or
regulation by any legislative body, court, governmental agency or regulatory authority (a “Change
in 1940 Act Law”), there is a more than an insubstantial risk that the Trust is or will be
considered an Investment Company which is required to be registered under the Investment Company
Act, which Change in 1940 Act Law becomes effective on or after the date of the Prospectus.




          “Regulatory Capital Event” means a determination by Citigroup, based on an opinion of counsel
experienced in such matters (who may be an employee of Citigroup or any of its affiliates), that,
as a result of (a) any amendment to, clarification of or change (including any announced
prospective change) in applicable laws or regulations or official interpretations thereof or
policies with respect thereto or (b) any official administrative pronouncement or judicial decision
interpreting or applying such laws or regulations, which amendment, clarification, change,
pronouncement or decision is announced or is effective after the date of the Prospectus, there is
more than an insubstantial risk that the Capital Securities will no longer constitute Tier I
Capital of Citigroup or any bank holding company of which Citigroup is a subsidiary (or its
equivalent) for purposes of the capital adequacy guidelines or policies of the Board of Governors
of the Federal Reserve System or its successor as Citigroup’s primary federal banking regulator,
provided, however that the distribution of the Debentures in connection with the liquidation of the
Trust shall not in and of itself constitute a Regulatory Capital Event unless such liquidation
shall have occurred in connection with a Tax Event or an Investment Company Event.




          On and from the date fixed by the Regular Trustees for any distribution of the Debentures and
dissolution of the Trust: (i) the Securities will no longer be deemed to be outstanding, (ii) DTC
or its nominee (or any successor Clearing Agency or its nominee), as the record Holder of the
Capital Securities, will receive a registered global certificate or certificates representing the
Debentures to be delivered upon such distribution and (iii) any certificates representing
Securities, except for certificates representing Capital Securities held by DTC or its nominee (or
any successor Clearing Agency or its nominee), will be deemed to represent beneficial interests in
the Debentures having an aggregate principal amount equal to the aggregate stated liquidation
amount of, with an interest rate identical to the Coupon Rate of, and accrued and unpaid interest
equal to accrued and unpaid Distributions on such Securities until such certificates are presented
to the Debenture Issuer or its agent for transfer or reissue.




          (d) The Trust may not redeem fewer than all the outstanding Securities unless all accrued and
unpaid Distributions have been paid on all Securities for all quarterly Distribution periods
terminating on or before the date of redemption.




          (e) If the Debentures are distributed to the Holders of the Securities, pursuant to the terms
of the Indenture, the Debenture Issuer will use its best efforts to cause the

I-7









 








Debentures to be listed on the New York Stock Exchange or on such other exchange as the
Capital Securities were listed immediately prior to the distribution of the Debentures.




          (f) Redemption or Distribution procedures will be as follows:





     (i) Notice of any redemption of, or notice of distribution of Debentures in exchange
for the Securities (a “Redemption/Distribution Notice”) will be given by the Trust by mail
to the Institutional Trustee and the Delaware Trustee and to each Holder of the Securities
to be redeemed or exchanged not fewer than 30 nor more than 60 days before the date fixed
for redemption or exchange thereof which, in the case of a redemption, will be the date
fixed for redemption of the Debentures. For purposes of the calculation of the date of
redemption or exchange and the dates on which notices are given pursuant to this Section
4(f)(i), a Redemption/ Distribution Notice shall be deemed to be given on the day such
notice is first mailed by first-class mail, postage prepaid, to the Holders of the
Securities. Each Redemption/ Distribution Notice shall be addressed to the Holders of the
Securities at the address of each such Holder appearing in the books and records of the
Trust. No defect in the Redemption/Distribution Notice or in the mailing of either thereof
with respect to any Holder shall affect the validity of the redemption or exchange
proceedings with respect to any other Holder.




     (ii) In the event that fewer than all the outstanding Securities are to be redeemed,
the Securities to be redeemed shall be redeemed Pro Rata from each Holder of Capital
Securities, it being understood that, in respect of Capital Securities registered in the
name of and held of record by DTC or its nominee (or any successor Clearing Agency or its
nominee), the distribution of the proceeds of such redemption will be made to each Clearing
Agency Participant (or Person on whose behalf such nominee holds such securities) in
accordance with the procedures applied by such agency or nominee.




     (iii) If Securities are to be redeemed and the Trust gives a Redemption/Distribution
Notice, which notice may only be issued if the Debentures are redeemed as set out in this
Section 4 (which notice will be irrevocable), then (A) while the Capital Securities are in
book-entry only form, with respect to the Capital Securities, by 12:00 noon, New York City
time, on the redemption date, provided, that the Debenture Issuer has paid to the
Institutional Trustee a sufficient amount of cash in connection with the related redemption
or maturity of the Debentures, the Institutional Trustee will deposit irrevocably with DTC
or its nominee (or successor Clearing Agency or its nominee) funds sufficient to pay the
applicable Redemption Price with respect to the Capital Securities and will give DTC (or any
successor Clearing Agency) irrevocable instructions and authority to pay the Redemption
Price to the Holders of the Capital Securities, and (B) with respect to Capital Securities
issued in definitive form and Common Securities, provided, that the Debenture Issuer has
paid the Institutional Trustee a sufficient amount of cash in connection with the related
redemption or maturity of the Debentures, the Institutional Trustee will pay the relevant
Redemption Price to the Holders of such Securities by check mailed to the address of the
relevant Holder appearing on the books and records of the Trust on the redemption date. If
a Redemption/Distribution Notice shall have been given and funds deposited as required, if
applicable, then immediately prior to the close of business on the date of such deposit, or



I-8









 







on the redemption date, as applicable, distributions will cease to accrue on the
Securities so called for redemption and all rights of the Holders of such Securities so
called for redemption will cease, except the right of the Holders of such Securities to
receive the Redemption Price, but without interest on such Redemption Price. Neither the
Regular Trustees nor the Trust shall be required to register or cause to be registered the
transfer of any Securities that have been so called for redemption. If any date fixed for
redemption of Securities is not a Business Day, then payment of the Redemption Price payable
on such date will be made on the next succeeding day that is a Business Day (and without any
interest or other payment in respect of any such delay) except that, if such Business Day
falls in the next calendar year, such payment will be made on the immediately preceding
Business Day, in each case with the same force and effect as if made on such date fixed for
redemption. If payment of the Redemption Price in respect of any Securities is improperly
withheld or refused and not paid either by the Institutional Trustee or by the Sponsor as
guarantor pursuant to the relevant Securities Guarantee, Distributions on such Securities
will continue to accrue from the original redemption date to the actual date of payment, in
which case the actual payment date will be considered the date fixed for redemption for
purposes of calculating the Redemption Price.




     (iv) Redemption/Distribution Notices shall be sent by the Regular Trustees on behalf of
the Trust to (A) in respect of the Capital Securities, DTC or its nominee (or any successor
Clearing Agency or its nominee) if the Global Certificates have been issued or, if
Definitive Capital Security Certificates have been issued, to the Holder thereof and (B) in
respect of the Common Securities to the Holder thereof.




     (v) Subject to the foregoing and applicable law (including, without limitation, United
States federal securities laws), the Debenture Issuer or its affiliates may at any time and
from time to time purchase outstanding Capital Securities by tender, in the open market or
by private agreement.



          5. Voting Rights — Capital Securities.




          (a) Except as provided under Sections 5(b) and 7 and as otherwise required by law and the
Declaration, the Holders of the Capital Securities will have no voting rights.




          (b) Subject to the requirements set forth in this paragraph, the Holders of a Majority in
aggregate liquidation amount of the Capital Securities, voting separately as a class, may direct
the time, method, and place of conducting any proceeding for any remedy available to the
Institutional Trustee, or direct the exercise of any trust or power conferred upon the
Institutional Trustee under the Declaration, including the right to direct the Institutional
Trustee, as holder of the Debentures, to (i) direct the time, method and place of conducting any
proceeding for any remedy available to the Debenture Trustee, or exercise any trust or power
conferred on the Debenture Trustee with respect to the Debentures, (ii) waive any past Default (as
defined in the Indenture) that is waivable under Section 5.6 of the Indenture, (iii) exercise any
right to rescind or annul a declaration that the principal of all the Debentures shall be due and
payable or (iv) consent to any amendment, modification or termination of the Indenture or the
Debentures where such consent shall be required; provided, however, that, where a consent or action
under the Indenture would require the consent or act of each holder of each Debenture

I-9









 








affected thereby, such consent or action under the Indenture shall not be effective until each
Holder of Capital Securities shall have consented to such action or provided such consent. The
Institutional Trustee shall not revoke any action previously authorized or approved by a vote of
the Holders of the Capital Securities. Except with respect to directing the time, method and place
of conducting a proceeding for a remedy available to the Institutional Trustee, the Institutional
Trustee, as holder of the Debentures, shall not take any of the actions described in clauses (i),
(ii), (iii) or (iv) above unless the Institutional Trustee has obtained an opinion of a nationally
recognized independent tax counsel experienced in such matters to the effect that as a result of
such action, the Trust will not fail to be classified as a grantor trust for United States federal
income tax purposes. If the Institutional Trustee fails to enforce its rights under the
Debentures, any Holder of Capital Securities may directly institute a legal proceeding against the
Debenture Issuer to enforce the Institutional Trustee’s rights under the Debentures without first
instituting a legal proceeding against the Institutional Trustee or any other Person or entity. If
a Default under the Declaration has occurred and is continuing and such event is attributable to
the failure of the Debenture Issuer to pay interest or principal on the Debentures on the date such
interest or principal is otherwise payable (or in the case of redemption, on the redemption date),
then a holder of Capital Securities may also directly institute a proceeding for enforcement of
payment to such holder (a “Direct Action”) of the principal of or interest on the Debentures having
a principal amount equal to the aggregate liquidation amount of the Capital Securities of such
holder on or after the respective due date specified in the Debentures without first (i) directing
the Institutional Trustee to enforce the terms of the Debentures or (ii) instituting a legal
proceeding directly against the Debenture Issuer to enforce the Institutional Trustee’s rights
under the Debentures. Except as provided in the preceding sentence, the Holders of Capital
Securities will not be able to exercise directly any other remedy available to the holders of the
Debentures. In connection with such Direct Action, Citigroup will be subrogated to the rights of
such Holder of Capital Securities under the Declaration to the extent of any payment made by
Citigroup to such holder of Capital Securities in such Direct Action.




          Any required approval or direction of Holders of Capital Securities may be given at a separate
meeting of Holders of Capital Securities convened for such purpose, at a meeting of all of the
Holders of Securities in the Trust or pursuant to written consent. The Regular Trustees will cause
a notice of any meeting at which Holders of Capital Securities are entitled to vote, or of any
matter upon which action by written consent of such Holders is to be taken, to be mailed to each
Holder of record of Capital Securities. Each such notice will include a statement setting forth
(i) the date of such meeting or the date by which such action is to be taken, (ii) a description of
any resolution proposed for adoption at such meeting on which such Holders are entitled to vote or
of such matter upon which written consent is sought and (iii) instructions for the delivery of
proxies or consents.




          No vote or consent of the Holders of the Capital Securities will be required for the Trust to
redeem and cancel Capital Securities or to distribute the Debentures in accordance with this
Declaration and the terms of the Securities.




          Notwithstanding that Holders of Capital Securities are entitled to vote or consent under any
of the circumstances described above, any of the Capital Securities that are owned by the Sponsor
or any Affiliate of the Sponsor shall not be entitled to vote or consent and shall, for purposes of
such vote or consent, be treated as if they were not outstanding.




I-10









 








          6. Voting Rights — Common Securities.




          (a) Except as provided under Sections 6(b), (c) and 7 as otherwise required by law and the
Declaration, the Holders of the Common Securities will have no voting rights.




          (b) The Holders of the Common Securities are entitled, in accordance with and subject to
Article V of the Declaration, to vote to appoint, remove or replace any Trustee or to increase or
decrease the number of Trustees.




          (c) Subject to Section 2.6 of the Declaration and only after the Default with respect to the
Capital Securities has been cured, waived, or otherwise eliminated and subject to the requirements
of the second to last sentence of this paragraph, the Holders of a Majority in liquidation amount
of the Common Securities, voting separately as a class, may direct the time, method, and place of
conducting any proceeding for any remedy available to the Institutional Trustee, or direct the
exercise of any trust or power conferred upon the Institutional Trustee under the Declaration,
including (i) directing the time, method, place of conducting any proceeding for any remedy
available to the Debenture Trustee, or exercising any trust or power conferred on the Debenture
Trustee with respect to the Debentures, (ii) waiving any past Default (as defined in the Indenture)
that is waivable under Section 5.6 of the Indenture, or (iii) exercising any right to rescind or
annul a declaration that the principal of all the Debentures shall be due and payable, provided
that, where a consent or action under the Indenture would require the consent or act of the Holders
of greater than a majority in principal amount of Debentures affected thereby (a “Super Majority”),
the Institutional Trustee may only give such consent or take such action at the written direction
of the Holders of at least the proportion in liquidation amount of the Common Securities which the
relevant Super Majority represents of the aggregate principal amount of the Debentures outstanding.
Pursuant to this Section 6(c), the Institutional Trustee shall not revoke any action previously
authorized or approved by a vote of the Holders of the Capital Securities. Other than with respect
to directing the time, method and place of conducting any proceeding for any remedy available to
the Institutional Trustee or the Debenture Trustee as set forth above, the Institutional Trustee
shall not take any action in accordance with the directions of the Holders of the Common Securities
under this paragraph unless the Institutional Trustee has obtained an opinion of tax counsel to the
effect that for the purposes of United States federal income tax the Trust will not be classified
as other than a grantor trust on account of such action. If the Institutional Trustee fails to
enforce its rights under the Declaration, any Holder of Common Securities may institute a legal
proceeding directly against any Person to enforce the Institutional Trustee’s rights under the
Declaration, without first instituting a legal proceeding against the Institutional Trustee or any
other Person.




          Any approval or direction of Holders of Common Securities may be given at a separate meeting
of Holders of Common Securities convened for such purpose, at a meeting of all of the Holders of
Securities in the Trust or pursuant to written consent. The Regular Trustees will cause a notice
of any meeting at which Holders of Common Securities are entitled to vote, or of any matter upon
which action by written consent of such Holders is to be taken, to be mailed to each Holder of
record of Common Securities. Each such notice will include a statement setting forth (i) the date
of such meeting or the date by which such action is to be taken, (ii) a description of any
resolution proposed for adoption at such meeting on which such

I-11









 








Holders are entitled to vote or of such matter upon which written consent is sought and (iii)
instructions for the delivery of proxies or consents.




          No vote or consent of the Holders of the Common Securities will be required for the Trust to
redeem and cancel Common Securities or to distribute the Debentures in accordance with the
Declaration and the terms of the Securities.




          7. Amendments to Declaration and Indenture.




          (a) In addition to any requirements under Section 12.1 of the Declaration, if any proposed
amendment to the Declaration provides for, or the Regular Trustees otherwise propose to effect, (i)
any action that would adversely affect the powers, preferences or special rights of the Securities,
whether by way of amendment to the Declaration or otherwise, or (ii) the dissolution, winding-up or
termination of the Trust, other than as described in Section 8.1 of the Declaration, then the
Holders of outstanding Securities as a class, will be entitled to vote on such amendment or
proposal (but not on any other amendment or proposal) and such amendment or proposal shall not be
effective except with the approval of the Holders of at least a Majority in liquidation amount of
the Securities, voting together as a single class; provided, however, if any amendment or proposal
referred to in clause (i) above would adversely affect only the Capital Securities or only the
Common Securities, then only the affected class will be entitled to vote on such amendment or
proposal and such amendment or proposal shall not be effective except with the approval of a
Majority in liquidation amount of such class of Securities.




          (b) In the event the consent of the Institutional Trustee as the holder of the Debentures is
required under the Indenture with respect to any amendment, modification or termination on the
Indenture or the Debentures, the Institutional Trustee shall request the written direction of the
Holders of the Securities with respect to such amendment, modification or termination and shall
vote with respect to such amendment, modification or termination as directed by a Majority in
liquidation amount of the Securities voting together as a single class; provided, however, that
where a consent under the Indenture would require the consent of the holders of greater than a
majority in aggregate principal amount of the Debentures (a “Super Majority”), the Institutional
Trustee may only give such consent at the direction of the Holders of at least the proportion in
liquidation amount of the Securities which the relevant Super Majority represents of the aggregate
principal amount of the Debentures outstanding; provided, further, that the Institutional Trustee
shall not take any action in accordance with the directions of the Holders of the Securities under
this Section 7(b) unless the Institutional Trustee has obtained an opinion of tax counsel to the
effect that for the purposes of United States federal income tax the Trust will not be classified
as other than a grantor trust on account of such action.




          8. Pro Rata.




          A reference in these terms of the Securities to any payment, distribution or treatment as
being “Pro Rata” shall mean pro rata to each Holder of Securities according to the aggregate
liquidation amount of the Securities held by the relevant Holder in relation to the aggregate
liquidation amount of all Securities outstanding unless, in relation to a payment, an a Default
under the Declaration has occurred and is continuing, in which case any funds available to make
such payment shall be paid first to each Holder of the Capital Securities pro rata

I-12









 








according to the aggregate liquidation amount of Capital Securities held by the relevant
Holder relative to the aggregate liquidation amount of all Capital Securities outstanding, and only
after satisfaction of all amounts owed to the Holders of the Capital Securities, to each Holder of
Common Securities pro rata according to the aggregate liquidation amount of Common Securities held
by the relevant Holder relative to the aggregate liquidation amount of all Common Securities
outstanding.




          9. Ranking.




          The Capital Securities rank pari passu and payment thereon shall be made Pro Rata with the
Common Securities except that, where a Default (as defined in the Indenture) occurs and is
continuing under the Indenture in respect of the Debentures held by the Institutional Trustee, the
rights of Holders of the Common Securities to payment in respect of Distributions and payments upon
liquidation, redemption and otherwise are subordinated to the rights to payment of the Holders of
the Capital Securities.




          10. Listing.




          The Regular Trustees shall use their best efforts to cause the Capital Securities to be listed
on the New York Stock Exchange.




          11. Acceptance of Securities Guarantee and Indenture.




          Each Holder of Capital Securities and Common Securities, by the acceptance thereof, agrees to
the provisions of the Capital Securities Guarantee, including the subordination provisions therein
and to the provisions of the Indenture.




          12. No Preemptive Rights.




          The Holders of the Securities shall have no preemptive rights to subscribe for any additional
securities.




          13. Miscellaneous.




          These terms constitute a part of the Declaration.




          The Sponsor will provide a copy of the Declaration or the Capital Securities Guarantee, and
the Indenture to a Holder without charge on written request to the Sponsor at its principal place
of business.




I-13









 





EXHIBIT A-1

FORM OF CAPITAL SECURITY CERTIFICATE




          THIS CAPITAL SECURITY IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE DECLARATION
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST COMPANY (THE
“DEPOSITARY”) OR A NOMINEE OF THE DEPOSITARY. THIS CAPITAL SECURITY IS EXCHANGEABLE FOR CAPITAL
SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE DECLARATION AND NO TRANSFER OF THIS CAPITAL SECURITY (OTHER
THAN A TRANSFER OF THIS CAPITAL SECURITY AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY) MAY BE REGISTERED EXCEPT IN LIMITED CIRCUMSTANCES.




          UNLESS THIS CAPITAL SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY
(55 WATER STREET, NEW YORK, NEW YORK) TO THE TRUST OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CAPITAL SECURITY ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A
PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.




			
	 	 	 
	Certificate Number
	 	Number of Capital Securities
	 	 	 
	 
	 	CUSIP NO.                     






Certificate Evidencing Capital Securities




of




CITIGROUP
CAPITAL XXXI




% Capital Securities

(Liquidation Amount $25 per Capital Security)




          CITIGROUP
CAPITAL XXXI, a statutory trust formed under the laws of the State of Delaware (the
“Trust”), hereby certifies that                      (the “Holder”) is the registered owner of                     
(___) capital securities of the Trust representing undivided beneficial interests in the assets of
the Trust designated the      % Capital Securities (the “Capital Securities”). The Capital
Securities are transferable on the books and records of the Trust, in person or by a duly
authorized attorney, upon surrender of this certificate duly endorsed and in proper form for
transfer. The designation, rights, privileges, restrictions, preferences and other terms and
provisions of the Capital Securities are set forth in, and this certificate and the Capital
Securities represented hereby are issued and shall in all respects be subject to, the provisions of




A1-1









 







the Amended and Restated Declaration of Trust of the Trust dated as of      , 20    , as
the same may be amended from time to time (the “Declaration”), including the designation of the
terms of the Capital Securities as set forth in Annex I thereto. Capitalized terms used herein but
not defined shall have the meaning given them in the Declaration. The Holder is entitled to the
benefits of the Capital Securities Guarantee to the extent provided therein. The Sponsor will
provide a copy of the Declaration, the Capital Securities Guarantee and the Indenture to a Holder
without charge upon written request to the Sponsor at its principal place of business.




          The Holder of this certificate, by accepting this certificate, is deemed to have (i) agreed to
the terms of the Indenture and the Debentures, including that the Debentures are subordinate and
junior in right of payment to all Senior Indebtedness (as defined in the Indenture) and (ii) agreed
to the terms of the Capital Securities Guarantee, including that the Capital Securities Guarantee
is (A) subordinate and junior in right of payment to all other liabilities of Citigroup, (B) pari
passu with the most senior preferred or preference stock now or hereafter issued by Citigroup and
with any guarantee now or hereafter issued by Citigroup with respect to preferred or preference
stock of Citigroup’s affiliates and (C) senior to Citigroup’s common stock.




          Upon receipt of this certificate, the Holder is bound by the Declaration and is entitled to
the benefits thereunder.




          By acceptance, the Holder agrees to treat, for United States federal income tax purposes, the
Debentures as indebtedness and the Capital Securities as evidence of indirect beneficial ownership
in the Debentures.




A1-2









 








          IN WITNESS WHEREOF, the Trust has executed this certificate this ___day of                     , ___.




	 	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title: Regular Trustee	 	 







A1-3









 








 






ASSIGNMENT



FOR VALUE RECEIVED, the undersigned assigns and transfers this Capital Security Certificate to:




	 	 	 
	 
	 
	 	 
	 
	 
	 	 
	 


	 	 
	(Insert assignee’s social security or tax identification number)







	 	 	 
	 
	 
	 	 
	 
	 
	 	 
	 
	 
	 	 
	 


	 	 
	(Insert address and zip code of assignee)






and irrevocably appoints




	 	 	 
	 


	 	 
	 
	 	 
	 


	 	 





                                                            agent to transfer this Capital Security
Certificate on the books of the Trust. The agent may substitute another to act for him or her.




Date:                                                             



Signature:                                         




(Sign exactly as your name appears on the other side of this Capital Security Certificate)





A1-4









 








EXHIBIT A-2




FORM OF COMMON SECURITY CERTIFICATE




TRANSFER OF THIS CERTIFICATE

IS SUBJECT TO THE CONDITIONS

SET FORTH IN THE DECLARATION

REFERRED TO BELOW




			
	 	 	 
	Certificate Number
	 	Number of Common Securities






Certificate Evidencing Common Securities




of




CITIGROUP
CAPITAL XXXI




% Common Securities

(Liquidation Amount $25 per Common Security)




          CITIGROUP
CAPITAL XXXI, a statutory trust formed under the laws of the State of Delaware (the
“Trust”), hereby certifies that Citigroup Inc., a Delaware corporation (the “Holder”), is the
registered owner of                      (                    ) common securities of the Trust representing undivided
beneficial interests in the assets of the Trust designated the      % Common Securities (the
“Common Securities”). The Common Securities are transferable on the books and records of the
Trust, in person or by a duly authorized attorney, upon surrender of this certificate duly endorsed
and in proper form for transfer and satisfaction of the other conditions set forth in the
Declaration (as defined below), including, without limitation, Section 9.1 thereof. The
designation, rights, privileges, restrictions, preferences and other terms and provisions of the
Common Securities represented hereby are issued and shall in all respects be subject to the
provisions of the Amended and Restated Declaration of Trust of the Trust dated as of      ,
20      , as the same may be amended from time to time (the “Declaration”), including the designation
of the terms of the Common Securities as set forth in Annex I thereto. Capitalized terms used
herein but not defined shall have the meaning given them in the Declaration. The Sponsor will
provide a copy of the Declaration and the Indenture to a Holder without charge upon written request
to the Sponsor at its principal place of business.




          Upon receipt of this certificate, the Holder is bound by the Declaration and is entitled to
the benefits thereunder.




          The Holder of this certificate, by accepting this certificate, is deemed to have agreed to the
terms of the Indenture and the Debentures, including that the Debentures are subordinate and junior
in right of payment to all Senior Indebtedness (as defined in the Indenture) as and to the extent
provided in the Indenture.




A2-1









 








          By acceptance, the Holder agrees to treat, for United States federal income tax purposes, the
Debentures as indebtedness and the Common Securities as evidence of indirect beneficial ownership
in the Debentures.




A2-2









 








          IN WITNESS WHEREOF, the Trust has executed this certificate this ___day of                     , ___.




	 	 	 	 	 
	 

	 	 

Name:
	 	 
	 

	 	Title: Regular Trustee	 	 






A2-3









 






 






ASSIGNMENT



FOR VALUE RECEIVED, the undersigned assigns and transfers this Common Security Certificate to:




	 	 	 
	   
	 
	 	 
	 
	 
	 	 
	 


	 	 
	(Insert assignee’s social security or tax identification number)






	 	 	 
	 
	 
	 	 
	 
	 
	 	 
	 
	 
	 	 
	 


	 	 
	(Insert address and zip code of assignee)





and irrevocably appoints                                                             




	 	 	 
	 




                                         agent to transfer this Common Security Certificate on the books of the Trust. The
agent may substitute another to act for him or her.




Date:                                                             



Signature:                                         




(Sign exactly as your name appears on the other side of this Common Security Certificate)




A2-4









 





EXHIBIT B




SPECIMEN OF DEBENTURE




B-1









 





EXHIBIT C




UNDERWRITING AGREEMENT





C-1