Document:

Exhibit 4.4

 

EMPLOYEE SHAREHOLDERS’ AGREEMENT

 

dated as of

 

February 12, 2018

 

among

 

VICTORY CAPITAL HOLDINGS, INC.

 

and

 

THE EMPLOYEE SHAREHOLDERS NAMED HEREIN

 

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
PAGE
    
	
 
    	
 
    	
 
    
	
ARTICLE 1.   DEFINITIONS
    	
1
    
	
 
    	
 
    	
 
    
	
Section 1.01.
    	
Definitions
    	
1
    
	
Section 1.02.
    	
Other Definitional and   Interpretative Provisions
    	
4
    
	
 
    	
 
    	
 
    
	
ARTICLE 2.   VOTING AGREEMENT
    	
4
    
	
 
    	
 
    	
 
    
	
Section 2.01.
    	
Irrevocable Proxy and   Power of Attorney
    	
4
    
	
 
    	
 
    	
 
    
	
ARTICLE 3.   EMPLOYEE SHAREHOLDERS COMMITTEE
    	
5
    
	
 
    	
 
    	
 
    
	
Section 3.01.
    	
Initial Membership and   Composition
    	
5
    
	
Section 3.02.
    	
Membership Criteria
    	
6
    
	
Section 3.03.
    	
Replacement/Removal of   Committee Members
    	
6
    
	
Section 3.04.
    	
Determinations of and   Actions by the Employee Shareholders Committee
    	
6
    
	
Section 3.05.
    	
Vote Required for   Actions
    	
7
    
	
Section 3.06.
    	
Liability and Indemnity
    	
7
    
	
 
    	
 
    	
 
    
	
ARTICLE 4.   TRANSFER AND ISSUANCE OF SHARES
    	
7
    
	
 
    	
 
    	
 
    
	
Section 4.01.
    	
Restrictions on   Transfer of Shares
    	
7
    
	
Section 4.02.
    	
Issuance of Additional   Common Stock
    	
8
    
	
Section 4.03.
    	
Amendments
    	
8
    
	
 
    	
 
    	
 
    
	
ARTICLE 5.   REPRESENTATIONS AND WARRANTIES AND COVENANTS
    	
8
    
	
 
    	
 
    	
 
    
	
ARTICLE 6. OTHER   AGREEMENTS OF THE PARTIES
    	
10
    
	
 
    	
 
    	
 
    
	
Section 6.01.
    	
Adjustment upon Changes   in Capitalization; Adjustments upon Changes of Control
    	
10
    
	
 
    	
 
    	
 
    
	
ARTICLE 7.   MISCELLANEOUS
    	
10
    
	
 
    	
 
    	
 
    
	
Section 7.01.
    	
Term of the Agreement;   Termination of Certain Provisions
    	
10
    
	
Section 7.02.
    	
Headings
    	
11
    
	
Section 7.03.
    	
Entire Agreement
    	
11
    
	
Section 7.04.
    	
Addresses and Notices
    	
11
    
	
Section 7.05.
    	
Governing Law;   Arbitration; Waiver of Jury Trial
    	
12
    
	
Section 7.06.
    	
Severability
    	
13
    
	
Section 7.07.
    	
Successors, Assigns
    	
13
    
	
Section 7.08.
    	
Waivers; Amendments
    	
13
    
	
Section 7.09.
    	
Counterparts;   Effectiveness
    	
14
    
	
Section 7.10.
    	
Remedies; Specific   Performance
    	
14
    
	
Section 7.11.
    	
Further Assurances
    	
14
    

 

i

 

	
Section 7.12.
    	
Third Party   Beneficiaries
    	
14
    
	
Section 7.13.
    	
No Rights to Continued   Relationship
    	
14
    

 

	
Exhibit A
    	
Joinder
    
	
Exhibit B
    	
Spousal Consent
    
	
Schedule A
    	
Covered Persons
    

 

ii

 

EMPLOYEE SHAREHOLDERS’ AGREEMENT

 

EMPLOYEE SHAREHOLDERS’ AGREEMENT dated as of February 12, 2018 (this “Agreement”) among Victory Capital Holdings, Inc., a Delaware corporation (the “Company”), each Person listed on Schedule A, as such Schedule A may be amended from time to time in accordance with the terms of this Agreement (each such Person, a “Covered Person”), executing this Agreement or a joinder (the “Joinder”) substantially in the form attached as Exhibit A hereto.

 

WITNESSETH:

 

WHEREAS, the Covered Persons are employees of the Company or its Subsidiaries who own shares of Common Stock or the right to acquire shares of Common Stock and will include future employees of the Company or its Subsidiaries to whom the Company has issued shares of Common Stock or the right to acquire shares of Common Stock;

 

WHEREAS, on the date hereof, the Company has closed its initial public offering (the “IPO”) of the Class A Common Stock; and

 

WHEREAS, in connection with the IPO, the parties to this Agreement deem it in their best interests to agree to form an Employee Shareholders Committee having the powers set forth in this Agreement to facilitate the exercise of voting rights relating to the Covered Common Stock.

 

NOW, THEREFORE, in consideration of the covenants and agreements contained herein, the parties hereto agree as follows:

 

ARTICLE 1.

 

DEFINITIONS

 

Section 1.01.                          Definitions.  The following terms, as used herein, have the following meanings:

 

A “beneficial owner” of a security includes any Person who, directly or indirectly, through any contract, arrangement, understanding, relationship or otherwise has or shares: (a) voting power, which includes the power to vote, or to direct the voting of, such security (for the avoidance of doubt, including with respect to unvested restricted stock), and/or (b) investment power, which includes the power to dispose, or to direct the disposition of, such security, but for purposes of this Agreement a Person shall not be deemed a beneficial owner of Common Stock solely by virtue of the application of Exchange Act Rule 13d-3(d) or Exchange Act Rule 13d-5. “Beneficially own” and “beneficial ownership” shall have correlative meanings.

 

“Business Day” shall mean any day except a Saturday, Sunday or other day on which commercial banks in New York City are authorized by law to close.

 

“Charter” shall mean the certificate of incorporation of the Company, as the same may be amended from time to time.

 

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“Common Stock” shall mean, collectively, Class A common stock of the Company, par value $0.01 per share (the “Class A Common Stock”), and Class B common stock of the Company, par value $0.01 per share (the “Class B Common Stock”), and any stock into which such common stock is hereafter converted or changed.

 

“Covered Common Stock” shall mean those shares of Common Stock that are beneficially owned at any particular time by a Covered Person and that were or are acquired by such Covered Person from the Company, including upon the exercise of options. For the avoidance of doubt, Covered Common Stock does not include shares of Common Stock that a Covered Person acquires on the open market or any issuer-directed Common Stock a Covered Person acquires in the IPO.

 

“Employee Shareholders Committee” shall mean the body constituted pursuant to Article 3 hereof.

 

“Exchange Act” shall mean the United States Securities Exchange Act of 1934, as amended from time to time.

 

“Exchange Act Rule” shall mean such rule or regulation of the SEC under the Exchange Act, as in effect from time to time or as replaced by a successor rule thereto.

 

“Permitted Transfer” shall mean, with respect to a Covered Person, any of the following: (a) any Transfer of shares of Covered Common Stock to a broker or other nominee; provided that the transferor, immediately following such Transfer, retains (i) the power (whether exclusive or shared) to vote or direct the voting of such share by proxy, voting agreement or otherwise, (ii) control over the disposition of such shares, and (iii) the economic consequences of ownership of such shares; and (b) any Transfer of shares of Covered Common Stock by a Covered Person who is a natural person to a trust the beneficiaries of which, or any corporation, limited liability company or partnership the stockholders, members or partners of which, include only such Covered Person or the spouse or lineal descendants (whether natural or adopted) of such Covered Person and which is controlled solely by such Covered Person; provided that the transferor, immediately following such Transfer, retains the power (whether exclusive or shared) to vote or direct the voting of such share by proxy, voting agreement or otherwise. The transferee of any such Permitted Transfer shall be referred to as a “Permitted Transferee.”

 

A “Person” shall include, as applicable, an individual, corporation, limited liability company, partnership, association, trust or other entity or organization, including a government or political subdivision or an agency or instrumentality thereof.

 

“Requisite Vote” shall mean, as of any time, the affirmative vote or consent of Covered Persons holding a majority of the voting power associated with the shares of Covered Common Stock.

 

“SEC” shall mean the United States Securities and Exchange Commission.

 

“Sole Beneficial Owner” shall mean a person who is the beneficial owner of shares of Common Stock, who does not share beneficial ownership of such shares of Common Stock with any other person (other than pursuant to this Agreement or applicable community

 

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property laws) and who is the only person (other than pursuant to applicable community property laws) with a direct economic interest in such shares of Common Stock. The interest of a spouse or a domestic partner in a joint account, and an economic interest of the Company as pledgee, shall be disregarded for this purpose.

 

“Subsidiary” shall mean, with respect to any Person, any entity of which securities or other ownership interests having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions are at the time directly or indirectly owned by such Person.

 

“Transfer” shall mean, with respect to any share of Covered Common Stock, directly or indirectly, any sale, assignment, transfer, conveyance, hypothecation, exchange, pledge, encumbrance, distribution, bequest, donation or other transfer or disposition of such share or any legal or beneficial interest in such share, whether or not for value and whether voluntary or involuntary or by operation of law (including by merger, consolidation or otherwise), including, without limitation, the transfer of, or entering into a binding agreement with respect to, the power (whether exclusive or shared) to vote or direct the voting of such share by proxy, voting agreement or otherwise. Notwithstanding the foregoing, the following shall not be considered a “Transfer” of a share of Covered Common Stock:

 

(a)                                 the granting by a Covered Person of a proxy to (x) the Employee Shareholders Committee pursuant to this Agreement, (y) officers or directors of the Company at the request of the Board of Directors in connection with actions to be taken at an annual or special meeting of stockholders or in connection with any action by written consent of the stockholders or (z) a representative of such Covered Person, in connection with actions to be taken at an annual or special meeting of stockholders or in connection with any action by written consent of the stockholders;

 

(b)                                 the pledge of shares of Covered Common Stock by a Covered Person that creates a mere security interest in such shares pursuant to a bona fide loan or indebtedness transaction for so long as such Covered Person continues to exercise the power (whether exclusive or shared) to vote or direct the voting of such pledged shares by proxy, voting agreement or otherwise; provided, however, that a foreclosure on such shares or other similar action by the pledgee shall constitute a “Transfer” unless such foreclosure or similar action qualifies as a “Permitted Transfer” at such time;

 

(c)                                  the entering into of a support or similar voting agreement (with or without granting a proxy) in connection with (x) any liquidation, dissolution or winding up of the Company, whether voluntary or involuntary, (y) any sale, lease, exclusive license or other disposition of all or substantially all of the assets of the Company, or (z) any consolidation or merger of the Company with or into any other Person or any other corporate reorganization; or

 

(d)                                 the fact that the spouse of any Covered Person possesses or obtains an interest in such Covered Person’s shares of Covered Common Stock arising solely by reason of the application of the community property laws of any jurisdiction, so long as no other event or circumstance shall exist or have occurred that constitutes a “Transfer” of such shares of Covered Common Stock.

 

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A “Transfer” shall be deemed to have occurred with respect to a share of Covered Common Stock beneficially held by a Permitted Transferee on the date that such Permitted Transferee ceases to meet the qualifications to be a Permitted Transferee of the Covered Person who effected the Transfer of such shares to such Permitted Transferee.

 

“vote” shall include actions taken or proposed to be taken by written consent.

 

Section 1.02.                          Other Definitional and Interpretative Provisions.  The words “hereof,” “herein” and “hereunder” and words of like import used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement.  The captions herein are included for convenience of reference only and shall be ignored in the construction or interpretation hereof.  References to Articles, Sections, Exhibits and Annexes are to Articles, Sections, Exhibits and Annexes to or of this Agreement unless otherwise specified.  All Exhibits and Annexes attached hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein.  Any capitalized terms used in any Exhibit or Annex but not otherwise defined therein shall have the meaning as defined in this Agreement.  Any singular term in this Agreement shall be deemed to include the plural, and any plural term the singular.  Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation,” whether or not they are in fact followed by those words or words of like import.  “Writing,” “written” and comparable terms refer to printing, typing and other means of reproducing words (including electronic media) in a visible form.  References to any agreement or contract are to that agreement or contract as amended, modified or supplemented from time to time in accordance with the terms hereof and thereof; provided that, with respect to any agreement or contract listed on any schedules hereto, all such amendments, modifications or supplements must also be listed in the appropriate schedule.  References to any statute or regulation are to the statute or regulation as amended, modified or supplemented from time to time and, in the case of statutes, include any rules and regulations promulgated thereunder, and references to any section of any statute or regulation include any successors of such sections.  References to any Person include the successors and permitted assigns of that Person.  References from or through any date mean, unless otherwise specified, from and including or through and including, respectively.

 

ARTICLE 2.

 

VOTING AGREEMENT

 

Section 2.01.                          Irrevocable Proxy and Power of Attorney.

 

(a)                                 By signing this Agreement or a Joinder, each Covered Person irrevocably appoints and constitutes the members of the Employee Shareholders Committee (each a “Committee Member”), acting jointly or each and any of them acting in his or her capacity as a Committee Member in accordance with the other provisions hereof, with full power of substitution and resubstitution, as its true and lawful proxy to vote, abstain from voting or otherwise act, for and in such Covered Person’s name, place and stead, with respect to all of the Covered Person’s Covered Common Stock as of the relevant record date or other date used for purposes of determining holders of Common Stock entitled to vote or take any action, as fully, to the same extent and with the same effect as such Covered Person might or could do under any

 

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applicable laws or regulations governing the rights and powers of stockholders of a Delaware corporation. The proxy granted the Committee Members pursuant to this Section 2.01(a) shall revoke all prior proxies granted by the Covered Person with respect to the Covered Common Stock, shall be irrevocable during the term set forth in the last sentence of this Section 2.01(a), shall survive the bankruptcy or dissolution of the Covered Person and shall be deemed to be coupled with an interest sufficient at law to support an irrevocable power. The Committee Members are authorized to execute that certain Second Amended and Restated Shareholders’ Agreement, dated as of the date hereof (the “Second A&R Shareholders’ Agreement”), and the Employee Shareholders Committee, as such committee may be reconstituted from time to time, is authorized to vote Covered Common Stock in order to ensure that the composition of the board of directors of the Company is as set forth in Section 2.01 of the Second A&R Shareholders’ Agreement.  For the avoidance of doubt, the Committee Members are authorized to vote Covered Common Stock in favor of the election of one or more Committee Members in elections of directors of the Company. Each Covered Person agrees that this irrevocable proxy may be exercised by the Committee Members with respect to all Covered Common Stock of such Covered Person for the period beginning on the effective date of this Agreement and ending on the earlier of (i) the date this Agreement shall have been terminated pursuant to Section 7.01(a) and (ii) the date of termination of this Agreement as to such Covered Person pursuant to Section 7.01(b).

 

(b)                                 By signing this Agreement or a Joinder, each Covered Person irrevocably appoints and constitutes the Committee Members, acting jointly or each and any of them acting in his or her capacity as a Committee Member in accordance with the other provisions hereof, with full power of substitution and resubstitution, his or her true and lawful attorney-in-fact to direct the voting of any Covered Common Stock held of record by any other Person but beneficially owned by such Covered Person, granting to such attorneys, and each of them, full power and authority to do and perform each and every act and thing whatsoever that such attorney or attorneys may deem necessary, advisable or appropriate to carry out fully the intent of this Section 2.01 as such Covered Person might or could do personally, hereby ratifying and confirming all acts and things that such attorney or attorneys may do or cause to be done by virtue of this power of attorney. It is understood and agreed by each Covered Person that this appointment, empowerment and authorization may be exercised by the aforementioned Persons with respect to all Covered Common Stock of such Covered Person, and held of record by another Person, for the period beginning on the effective date of this Agreement and ending on the earlier of (i) the date this Agreement shall have been terminated pursuant to Section 7.01(a) and (ii) the date of termination of this Agreement as to such Covered Person pursuant to Section 7.01(b). The power of attorney granted by the Covered Person hereunder is a durable power of attorney and shall survive the dissolution or bankruptcy of the Covered Person and shall revoke any and all prior powers of attorney granted by the Covered Person with respect to the shares of Covered Common Stock subject hereto.

 

ARTICLE 3.

 

EMPLOYEE SHAREHOLDERS COMMITTEE

 

Section 3.01.                          Initial Membership and Composition.  The Employee Shareholders Committee shall consist of three individuals.  The initial Committee Members shall be David C.

 

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Brown, the Chief Executive Officer of the Company (the “CEO”), Michael D. Policarpo, the Chief Operating Officer of the Company (the “COO”), and Kelly S. Cliff, the President, Investment Franchises of the Company (the “President”).

 

Section 3.02.                          Membership Criteria. The Committee Members shall be individuals who are employees of the Company or one or more of its Subsidiaries and who own shares of Common Stock (the “Membership Criteria”).

 

Section 3.03.                          Replacement/Removal of Committee Members.

 

(a)                                 If the individual holding the position of CEO ceases to hold such position for any reason, such individual will automatically cease to be a Committee Member and the new individual appointed as CEO shall automatically become a Committee Member upon such appointment. For the avoidance of doubt, the CEO cannot be removed by the Covered Persons.

 

(b)                                 If the individual holding the position of COO or President ceases to hold such position for any reason, if such individual was a Committee Member at such time, such individual will automatically cease to be a Committee Member and the new individual appointed as COO or President shall automatically become a Committee Member upon such appointment.  If no individual is appointed as a replacement COO or President (or a substantially similar position in lieu thereof) within 90 days, such vacancy may be temporarily filled with an individual satisfying the Membership Criteria designated by Covered Persons holding the Requisite Vote, until such time as a replacement appointment of such officer is made.

 

(c)                                  Any Committee Member, other than the CEO, may be removed for any reason and replaced by an individual satisfying the Membership Criteria designated by Covered Persons holding the Requisite Vote.

 

(d)                                 No Committee Member that is then CEO, COO or President may resign from the Employee Shareholders Committee without resigning as an officer of the Company; any other Committee Member may resign at any time upon written notice to the Company and the other Committee Members. Such resignation will take effect at the time specified in the related notice, and unless otherwise specified in the notice no acceptance of the resignation will be necessary to make it effective.  If any Committee Member resigns or ceases to satisfy the Membership Criteria or is unable to serve as a Committee Member by reason of his or her death, such individual shall immediately cease to be a Committee Member and shall, if not replaced pursuant to Section 3.03(b), be replaced by an individual satisfying the Membership Criteria designated by Covered Persons holding the Requisite Vote.

 

(e)                                  Any successor Committee Member must become a party to this Agreement as a Committee Member by executing documentation reasonably satisfactory to the Company.

 

Section 3.04.                          Determinations of and Actions by the Employee Shareholders Committee.

 

(a)                                 All determinations necessary or advisable under this Agreement with respect to the Covered Persons (including determinations of beneficial ownership and status as a

 

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Covered Person) shall be made by the Employee Shareholders Committee, the determinations of which, absent manifest error, shall be final and binding.

 

(b)                                 Each Covered Person recognizes and agrees that the Committee Members in acting hereunder shall at all times be acting in their capacities as Committee Members and not as directors or officers of the Company and in so acting or failing to act shall not have any fiduciary duties to the Covered Persons as a Committee Member by virtue of the fact that one or more of such Committee Members may also be serving as a director or officer of the Company or otherwise.

 

(c)                                  The Employee Shareholders Committee may act at a meeting (in person or telephonically) or by a written instrument signed by the number of Committee Members the consent or approval of which is otherwise required for action. Meetings of the Employee Shareholders Committee may be held at any time or place, whenever called by any Committee Member. Reasonable notice thereof will be given by the Committee Member or Committee Members calling the meeting to the other Committee Members.

 

Section 3.05.                          Vote Required for Actions.  The vote or consent, as applicable, of at least two Committee Members present at a meeting of the Employee Shareholders Committee or acting by written consent (or of the sole Committee Member, if there is only one such member) shall be the act of the Employee Shareholders Committee.

 

Section 3.06.                          Liability and Indemnity.  No Committee Member shall be liable for any error of judgment or mistake of fact or law, or for any action or omission under this Agreement, except in the case of such Committee Member’s fraud, bad faith or willful misconduct. No Committee Member shall be liable for acting on any notice, request or instruction or other document believed to be genuine by such Committee Member and to have been executed by or on behalf of the proper party or parties. The Company shall pay all reasonable expenses of the Committee Members, including counsel fees, and shall discharge all liabilities incurred by them in connection with the exercise of their powers and the performance of their duties under this Agreement. Any action or omission undertaken by a Committee Member in good faith in accordance with the advice of legal counsel shall be binding and conclusive on the parties to this Agreement. The Company shall also defend, indemnify and hold the Committee Members harmless from and against any and all claims and liabilities in connection with or arising out of the exercise of any powers or the performance of any duties by the Committee Members as herein provided or contemplated, except for such claims or liabilities as shall arise from the fraud, bad faith or willful misconduct of the Committee Members.

 

ARTICLE 4.

 

TRANSFER AND ISSUANCE OF SHARES

 

Section 4.01.                          Restrictions on Transfer of Shares.  No Covered Person shall Transfer any shares of Common Stock to a Permitted Transferee who is not a Covered Person unless such transferee has executed and delivered to the Company a Joinder substantially in the form of Exhibit A. In the event that a Covered Person Transfers any of its shares of Class B Common Stock to a Person other than a Permitted Transferee, such shares shall, effective upon the

 

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consummation of such Transfer, be converted into shares of Class A Common Stock in accordance with the Charter.

 

Section 4.02.                          Issuance of Additional Common Stock.  If the Company issues additional shares of Common Stock to employees of the Company or its Subsidiaries, the proposed recipient of any such shares shall be required as a condition of such issuance to execute and deliver to the Company a Joinder substantially in the form of Exhibit A.

 

Section 4.03.                          Amendments.  The Company shall amend Schedule A as necessary from time to time to reflect any changes in the Covered Persons pursuant to this Article 4.

 

ARTICLE 5.

 

REPRESENTATIONS AND WARRANTIES AND COVENANTS

 

Each Covered Person severally represents and warrants or agrees, as applicable, for itself that:

 

(a)                                 Such Covered Person has (and, with respect to shares of Common Stock to be acquired, will have) good, valid and marketable title to the shares of Common Stock of which the Covered Person is the Sole Beneficial Owner, free and clear of any pledge, lien, security interest, charge, claim, equity or encumbrance of any kind, other than pursuant to this Agreement, an agreement with the Company by which such Covered Person is bound and to which the shares of Common Stock are subject or as permitted by the policies of the Company in effect from time to time;

 

(b)                                 Such Covered Person has (and, with respect to shares of Common Stock to be acquired, will have) the right to vote pursuant to Section 2.01 of this Agreement all shares of Common Stock of which the Covered Person is the Sole Beneficial Owner;

 

(c)                                  If the Covered Person is not a natural person:

 

(i)                                     such Covered Person is duly organized and validly existing in good standing under the laws of the jurisdiction of such Covered Person’s formation;

 

(ii)                                  such Covered Person has full right, power and authority to enter into and perform this Agreement;

 

(iii)                               the execution and delivery of this Agreement and the performance of the transactions contemplated herein have been duly authorized, and no further proceedings on the part of such Covered Person are necessary to authorize the execution, delivery and performance of this Agreement; and this Agreement has been duly executed by such Covered Person;

 

(iv)                              the Person signing this Agreement on behalf of such Covered Person has been duly authorized by such Covered Person to do so;

 

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(d)                                 this Agreement constitutes the legal, valid and binding obligation of such Covered Person, enforceable against such Covered Person in accordance with its terms (subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors’ rights and to general equity principles);

 

(e)                                  neither the execution and delivery of this Agreement by such Covered Person nor the consummation of the transactions contemplated herein conflicts with or results in a breach of any of the terms, conditions or provisions of any agreement or instrument to which such Covered Person is a party or by which the assets of such Covered Person are bound (including without limitation the organizational documents of such Covered Person, if such Covered Person is other than a natural person), or constitutes a default under any of the foregoing, or violates any law or regulation;

 

(f)                                   such Covered Person has obtained all authorizations, consents, approvals and clearances of all courts, governmental agencies and authorities, and any other Person, if any (including the consent of the spouse of such Covered Person with respect to the interest of such spouse in the shares of Common Stock of such Covered Person; such consent in substantially the form of Exhibit B), required to permit such Covered Person to enter into this Agreement and to consummate the transactions contemplated herein;

 

(g)                                  there are no actions, suits or proceedings pending, or, to the knowledge of such Covered Person, threatened against or affecting such Covered Person or such Covered Person’s assets in any court or before or by any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality which, if adversely determined, would impair the ability of such Covered Person to perform this Agreement;

 

(h)                                 the performance of this Agreement will not violate any order, writ, injunction, decree or demand of any court or federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality to which such Covered Person is subject;

 

(i)                                     no statement, representation or warranty made by such Covered Person in this Agreement, nor any information provided by such Covered Person for inclusion in a registration statement filed by the Company in connection with the IPO, contains or will contain any untrue statement of a material fact or omits or will omit to state a material fact necessary in order to make the statements, representations or warranties contained herein or information provided therein not misleading; and

 

(j)                                    Each Covered Person severally, and not jointly, agrees for itself that the foregoing provision of this Article 5 shall be a continuing representation and covenant by it during the period that it shall be a Covered Person, and it shall take all actions as shall from time to time be necessary to cure any breach or violation and to obtain any authorizations, consents, approvals and clearances in order that such representations shall continue to be true and correct during that period.

 

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ARTICLE 6.

 

OTHER AGREEMENTS OF THE PARTIES

 

Section 6.01.                          Adjustment upon Changes in Capitalization; Adjustments upon Changes of Control.

 

(a)                                 In the event of any change in the outstanding Common Stock by reason of stock dividends, stock splits, reverse stock splits, spin-offs, split-ups, recapitalizations, combinations, exchanges of shares and the like, the terms “Class A Common Stock” and “Class B Common Stock,” as applicable, shall refer to and include the securities received or resulting therefrom, but only to the extent such securities are received in exchange for or in respect of Common Stock. Upon the occurrence of any event described in the immediately preceding sentence, the Employee Shareholders Committee shall make such adjustments to or interpretations of any provisions of this Agreement as it shall deem necessary, advisable or appropriate to carry out the intent of such provisions. If the Employee Shareholders Committee deems it necessary, advisable or appropriate, any such adjustments may take effect from the record date, the “when issued trading date,” the “ex dividend date” or another appropriate date.

 

(b)                                 In the event of any business combination, restructuring, recapitalization or other extraordinary transaction involving the Company, its Subsidiaries or any of their respective securities or assets as a result of which any of the parties hereto (other than the Company) holds voting securities of a Person other than the Company and in which the shares of capital stock of the Company outstanding immediately prior to such transaction continue to represent, or are converted into or exchanged for shares of capital stock or other equity securities that represent, immediately following such transaction, at least a majority, by voting power, of the capital stock or other equity securities of the surviving or resulting entity or of the parent entity of such surviving or resulting entity, such party agrees that this Agreement shall also continue in full force and effect with respect to such voting securities of such other Person formerly representing or distributed in respect of Common Stock and the terms “Class A Common Stock,” “Class B Common Stock” and “the Company” shall refer to such voting securities formerly representing or distributed in respect of shares of Class A Common Stock, Class B Common Stock, and such other Person, respectively. Upon the occurrence of any event described in the immediately preceding sentence, the Employee Shareholders Committee shall make such adjustments to or interpretations of any provisions of this Agreement as it shall deem necessary, advisable or appropriate to carry out the intent of such provisions. If the Employee Shareholders Committee deems it necessary, advisable or appropriate, any such adjustments may take effect from the record date or another appropriate date.

 

ARTICLE 7.

 

MISCELLANEOUS

 

Section 7.01.                          Term of the Agreement; Termination of Certain Provisions.

 

(a)                                 This Agreement may be terminated in its entirety as follows:

 

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(i)                                     at any time by written consent of all of the parties to this Agreement; or

 

(ii)                                  following the conversion of all the shares of Class B Common Stock into shares of Class A Common Stock, in accordance with the Charter, by written consent of Covered Persons holding at least two-thirds of the total number of outstanding shares of Covered Common Stock.

 

(b)                                 Any Person who has Transferred all of its shares of Covered Common Stock, other than to a Permitted Transferee, died, or whose employment with the Company or any of its Subsidiaries has been terminated, shall cease to be a Covered Person and shall no longer be bound by, or have any rights pursuant to, the provisions of this Agreement, and such Person’s name shall be removed from Schedule A to this Agreement. Additionally, the shares of Class B Common Stock owned by any such Person, if any, shall automatically convert into shares of Class A Common Stock, in accordance with the Charter.

 

(c)                                  Sections 3.04 and 3.06 shall survive the termination of this Agreement and shall continue to apply to each Person who ceases to be a Covered Person.

 

Section 7.02.                          Headings.  The headings in this Agreement are for convenience of reference only and shall not control or affect the meaning or construction of any provisions hereof.

 

Section 7.03.                          Entire Agreement.  This Agreement constitutes the entire agreement and understanding among the parties hereto in respect of the subject matter contained herein, and there are no restrictions, promises, representations, warranties, covenants or undertakings with respect to the subject matter hereof other than those expressly set forth or referred to herein.  This Agreement supersedes all prior and contemporaneous agreements and understandings among the parties hereto with respect to the subject matter hereof.

 

Section 7.04.                          Addresses and Notices.  All notices, requests or other communications to any party hereunder shall be in writing (which may include facsimile transmission) and shall be given,

 

if to the Company or the Employee Shareholders Committee, to:

 

4900 Tiedeman Road

Brooklyn, Ohio 44144

Attention:  Michael Policarpo

Nina Gupta

Telephone:  (216) 898-2552

Facsimile:  (216) 370-9011

 

and if to any other party hereto, to the address or facsimile number set forth on the signature page hereto or any other address or facsimile number in the United States as such party hereafter may specify for such purpose to the Company.

 

11

 

All such notices, requests and other communications shall be deemed received by the recipient thereof on the date of receipt if received prior to 5 p.m. in the place of receipt and such day is a Business Day in the place of receipt.  Otherwise, any such notice, request or communication shall be deemed not to have been received until the next succeeding Business Day in the place of receipt.

 

Section 7.05.                          Governing Law; Arbitration; Waiver of Jury Trial.

 

(a)                                 This Agreement shall be governed by, and construed under, the laws of the State of Delaware, and all rights and remedies shall be governed by said laws, without regard to conflict of laws principles.

 

(b)

 

(i)                                     To the fullest extent permitted by law, the parties hereto agree that any claim, dispute or controversy based on any matter arising out of or in connection with this Agreement or the other agreements or transactions contemplated hereby shall be submitted to and resolved exclusively by arbitration conducted in accordance with this Section 7.05(b).

 

(ii)                                  Any party may, by delivering a written demand to any other party, submit any such claim, dispute or controversy to binding arbitration conducted in New York City, New York (or such other location as the parties thereto may agree) in accordance with the applicable rules of the American Arbitration Association then in effect, and the arbitration shall be heard and determined by a panel of three arbitrators in accordance with such rules (except that in the event of any inconsistency between such rules and this Section 7.05(b), the provisions of this Section 7.05(b) shall control).  Each demand shall briefly set forth the nature of the underlying dispute and the amount, if any, involved.  The arbitration panel may not modify the arbitration rules specified above without the prior written approval of all parties to the arbitration (provided that, notwithstanding the foregoing, in the case of any arbitration between the Company and/or the Employee Shareholders Committee, on the one hand, and one or more Covered Persons, on the other hand, the arbitration panel may modify such arbitration rules with the prior written approval of the Company, the Employee Shareholders Committee and Covered Persons owning a majority of the Covered Common Stock owned by the Covered Persons who are party to such arbitration).

 

(iii)                               Within ten Business Days after the receipt of a demand, each party shall designate one arbitrator, each of whom shall have experience involving complex business or legal matters, but shall not have any prior, existing or potential material business relationship with any party to the arbitration (provided that, notwithstanding the foregoing, in the case of any arbitration between the Company and/or the Employee Shareholders Committee, on the one hand, and one or more Covered Persons, on the other hand, the Company and/or the Employee Shareholders Committee shall designate one arbitrator, and Covered Persons owning a majority of the Covered Common Stock owned by the Covered Persons who are party to such arbitration shall designate one arbitrator).  The two arbitrators so designated shall select a third arbitrator, who shall

 

12

 

preside over the arbitration, shall be similarly qualified as the two arbitrators and shall have no prior, existing or potential material business relationship with any party to the arbitration; provided that if the two arbitrators are unable to agree upon the selection of such third arbitrator, such third arbitrator shall be designated in accordance with the arbitration rules referred to above.

 

(iv)                              The arbitrators will decide the dispute by majority decision, and the decision shall be rendered in writing and shall bear the signatures, the arbitration and the party or parties who shall be charged therewith, or the allocation of the expenses among the parties in the discretion of the panel.  The arbitration decision shall be rendered as soon as possible, but in any event not later than 120 days after the constitution of the arbitration panel.  The arbitration decision shall be final and binding upon all parties to the arbitration.  The parties hereto agree that judgment upon any award rendered by the arbitration panel may be entered in the United States District Court for the Southern District of New York or any New York State court sitting in New York City.  To the maximum extent permitted by law, the parties hereby irrevocably waive any right of appeal from any judgment rendered upon any such arbitration award in any such court.  Notwithstanding Section 7.05(b)(i), any party may seek injunctive relief in any such court.

 

(c)                                  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

Section 7.06.                          Severability.  If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party.  Upon such a holding by a court or other authority, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner so that the transactions contemplated hereby be consummated as originally contemplated to the fullest extent possible.

 

Section 7.07.                          Successors, Assigns.  The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns.

 

Section 7.08.                          Waivers; Amendments.

 

(a)                                 Any provision of this Agreement may be waived if, but only if, such waiver is in writing and is signed, by the party or parties against whom the waiver is to be effective.  Except as expressly set forth herein, no failure or delay on the part of any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any

 

13

 

single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege.

 

(b)                                 No provision of this Agreement may be amended or otherwise modified except by the prior written consent of (a) the Company, (b) the Employee Shareholders Committee, and (c) the Covered Persons holding the Requisite Vote; provided that any amendment to Section 7.01(a)(ii) shall require the consent of Covered Persons holding at least two-thirds of the total number of outstanding shares of Covered Common Stock.  Notwithstanding the foregoing, this Agreement shall be deemed amended from time to time to reflect the addition of a party to this Agreement pursuant to Article 4 hereof, and no consent pursuant to this Section 7.08 shall be required in connection with any such amendment.

 

Section 7.09.                          Counterparts; Effectiveness.  This Agreement may be executed in any number of counterparts (including by electronic mail portable document format (*.pdf) (or similar electronic means) or facsimile signature), each of which shall be an original with the same effect as if the signatures thereto and hereto were upon the same instrument.

 

Section 7.10.                          Remedies; Specific Performance.  Except as otherwise specifically provided for in this Agreement, (a) the rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law and (b) each party hereto acknowledges that the remedies at law of the other parties for a breach or threatened breach of this Agreement would be inadequate and, in recognition of this fact, any party to this Agreement, without posting any bond, shall be entitled to obtain equitable relief in the form of specific performance, a temporary restraining order, a temporary or permanent injunction or any other equitable remedy that may then be available.

 

Section 7.11.                          Further Assurances.  The Company and each party hereto shall take, or cause to be taken, all actions and do, or cause to be done, all things necessary or desirable under applicable law to consummate the transactions contemplated by this Agreement.

 

Section 7.12.                          Third Party Beneficiaries.  Nothing in this Agreement, express or implied, is intended to confer on any Person other than the parties hereto and their respective successors and permitted assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement.

 

Section 7.13.                          No Rights to Continued Relationship.  Neither this Agreement nor any action taken or omitted to be taken hereunder shall be deemed to create or confer on any Person any right to be retained in any employment, consultant, advisory, director, manager or other such relationship by the Company or any of its Subsidiaries, or to interfere with or to limit in any way the right of the Company or any of its Subsidiaries to terminate such relationship with any such Person at any time.

 

[Signature page follows.]

 

14

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.

 

	
 
    	
VICTORY CAPITAL HOLDINGS, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ David C. Brown
    
	
 
    	
 
    	
Name: David C. Brown
    
	
 
    	
 
    	
Title: Chief Executive Officer
    

 

[Signature Page to Employee Shareholders’ Agreement]

 

 

Each Covered Person initially listed on Schedule A hereto

 

[Signature Page to Employee Shareholders’ Agreement]

 

 

	
 
    	
EMPLOYEE SHAREHOLDERS COMMITTEE
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ David C. Brown
    
	
 
    	
Name: David C. Brown
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ Michael D. Policarpo
    
	
 
    	
Name: Michael D. Policarpo
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ Kelly S. Cliff
    
	
 
    	
Name: Kelly S. Cliff
    

 

[Signature Page to Employee Shareholders’ Agreement]

 

 

EXHIBIT A

 

JOINDER TO EMPLOYEE SHAREHOLDERS’ AGREEMENT

 

In consideration of the [Transfer (as defined in the Shareholders’ Agreement)] [issuance by Victory Capital Holdings, Inc.] to the undersigned of shares of Covered Common Stock (as defined in the Shareholders’ Agreement), the undersigned hereby consents and agrees to become a party to and be bound by the Employee Shareholders’ Agreement (the “Shareholders’ Agreement”), dated as of February 12, 2018, as amended (receipt of a copy of which is hereby acknowledged), as fully as if the undersigned were one of the original Covered Persons (as defined in the Shareholders’ Agreement), and all shares of Covered Common Stock beneficially owned by the undersigned shall be held in accordance with and restricted by the terms of such Shareholders’ Agreement and such stockholder’s name shall be listed on Schedule A.

 

Date: [        ]

 

	
Name of Covered Person:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Sign Name:
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Print Name:
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
SSN/EIN:
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Approved by:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
VICTORY CAPITAL HOLDINGS, INC.
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    	
 
    
						

 

1

 

EXHIBIT B

 

SPOUSAL CONSENT

 

Dated: [·]

 

I am the spouse, domestic partner, or partner under a civil union, as applicable (the “Spouse”), of [•], a party to that certain Employee Shareholders’ Agreement (the “Shareholders’ Agreement”), dated as of February 12, 2018, as amended.  Capitalized terms used and not defined herein have the meanings assigned to them in the Shareholders’ Agreement.

 

On behalf of myself and my heirs and legatees, I hereby confirm and acknowledge that I (i) have read the Shareholders’ Agreement in its entirety, (ii) understand and am familiar with the terms and conditions set forth therein, (iii) have been advised and encouraged to consult with independent counsel of my own choosing with respect to the Shareholders’ Agreement and the matters set forth therein, (iv) approve and consent to the execution and delivery by my Spouse of the Shareholders’ Agreement, (v) agree that my interest (community property or otherwise) in the Company will be subject to this consent and (vi) agree that my Spouse may join in any future amendments or modifications to the Shareholders’ Agreement or any related document without notice to me and without my further signature, acknowledgement, agreement or consent.

 

 

	
 
    	
 
    
	
[NAME]
    

 

2Exhibit 10.1

	

	

 

	
preferred custody services

	
Account Application

 

Welcome

This Application can be used to establish a Preferred Custody Account at Citi Private Bank. Please be sure to provide all of the information requested. Not providing all information may result in a delay in processing your application and establishing your account.

If you make a mistake while completing this Application, cross out the information you wish to change, enter the correct information and initial it.

 

To simplify and expedite the account opening process, please consult your CPB representative for any additional documentation which may be required.

Important Information About Opening A New Account At Citigroup

 

To help the United States Government fight terrorism and money laundering, Federal law requires financial institutions to obtain, verify, and record information that identifies each individual, business or entity that opens an account or establishes a relationship. What this means for you:

For individuals—when you open an account or establish a relationship, we will ask for your:

		•	
name,

		•	
date of birth,

		•	
residential street address, and

		•	
identification number, such as a social security number, taxpayer identification number, national identification number or passport number.

For businesses and other entities, such as corporations, trusts, etc. — when you open an account or establish a relationship, we will ask for your:

		•	
official name,

		•	
principal place of business or local business street address, and

		•	
taxpayer identification number or other registration number.

For individuals, we may also ask to see (and retain a copy of) your driver’s license, passport or other identifying documents that will help us identify you. For businesses or entities, we may also ask for a copy of your formation documents or other related documentation. If we have difficulty verifying an accountholder’s identity, we may not be able to open an account or establish a relationship, or we may have to block or close the account.

Thank you for your cooperation.

Terms and Definitions of Words Used in this Application

Unless otherwise indicated in this Preferred Custody Services Account Application (the “Application” herein) or in the Terms and Conditions delivered to you from time to time in connection therewith (collectively, the “Agreement”), “you”, “your” and “yours” mean the persons and/or entity named below under “Accountholder Information”, as the owner or holder of each custody account(s) established by you hereunder (each an “Account”). Where the context so admits, “you”, “your” and “yours” also refer to any representative designated to give us instructions on behalf of the holder(s) or owner(s) of the Account(s).

All references in this Application to “Citibank” mean Citibank, N.A. and its successors. All references to “Citigroup” mean Citigroup Inc., Citigroup’s affiliates and its successors, including Citibank, their branches and subsidiaries, wherever located. Unless otherwise indicated in this Application, “we”, “us” and “our” mean Citibank and where appropriate, Citi Private Bank (“CPB”) Preferred Custody Services, its successors and assigns. Capitalized terms not defined in this Application have the meanings contained in the accompanying Terms and Conditions.

 

	
1

	
Accountholder Information

Instructions: Please complete below and Section A, B, C &/or D as applicable.

	
Account Title:

	
	
 

	
 

 

Account Type (check one box only):

	☐	
Individual

	☐	
Limited Liability

	☐	
Trust

	☐	
UTMA (Uniform Transfers

	 
	 	 	 	
Company

	 	 	 	
to Minors Act) of the State of

	 
	☐	
Joint Account with

	☐	
Partnership

	☐	
Estate

	☐	
Individual Retirement

	
☐Other (please specify):

	 	
Right of Survivorship

	 	 	 	 	 	
Arrangement Accounts (IRA)

	 
	☐	
Corporation

	☐	
Pension/Profit Sharing Plan

	 

 

	
Address of Legal Residence (Individuals/IRAs) or Principal Place of Business (Partnerships, Corporate Entities and Others) or Trust/Estate Situs (Trusts, Estates or other Fiduciary Vehicles):*

	 	
Mailing Address for Account Statements, Confirmations, Advices and Other Notices 

(if different)**:

	
 

	 	 
	 	 	  
	 	 	  
	 	 	  
	 	 	  
	
*    May not be a P.O. Box

	 	
**   May not be "Hold All Mail" and must be alternate address for account owner/holder

 

The above party should receive (check as many as necessary): ☐monthly account statements, ☐ quarterly account statements,☐ transaction advices, ☐ cash advices (for interest and dividends), ☐ corporate reorganization/class action notices, ☐ proxies,

 

Important Note: only one party may be designated to receive corporate reorganization notices, class action notices and proxies per account. If no party is selected to receive corporate reorganization notices, class action notices or proxies, then such materials and notices we receive for your securities will be sent to the accountholder’s mailing address. If no statement period is selected, statements will be mailed monthly. Applicable year-end tax reporting information will be mailed to the accountholder; copies will be mailed to other interested parties as indicated below.

Mailing Addresses for Third Parties to Receive Account Statements, Confirmations, Advices and Other Notices:

 

	
1.

	
 

	 	
2.

	 

	
 

	 	  
	
 

	 	  
	
 

	 	  
	 	 	 
	

The above party should receive (check as many as necessary):

☐monthly account statements, ☐quarterly account statements, 

☐transaction advices, ☐cash advices (for interest and dividends), 

☐corporate reorganization/class action notices, ☐proxies, 

☐applicable year-end tax reporting information, 

☐ any other notices related to this Account.

	 	

The above party should receive (check as many as necessary):

☐monthly account statements, ☐quarterly account statements, 

☐transaction advices, ☐cash advices (for interest and dividends), 

☐corporate reorganization/class action notices, ☐proxies, 

☐applicable year-end tax reporting information, 

☐ any other notices related to this Account.

 

1

	
3.

	
 

	
 

	
4.

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	 	 	 
	

The above party should receive (check as many as necessary):

☐monthly account statements, ☐quarterly account statements, 

☐transaction advices, ☐cash advices (for interest and dividends), 

☐corporate reorganization/class action notices, ☐proxies, 

☐applicable year-end tax reporting information, 

☐any other notices related to this Account.

	
 

	

The above party should receive (check as many as necessary):

☐monthly account statements, ☐quarterly account statements, 

☐transaction advices, ☐cash advices (for interest and dividends), 

☐corporate reorganization/class action notices, ☐proxies, 

☐applicable year-end tax reporting information, 

☐any other notices related to this Account.

 

	
Account Details - Complete Section A, B, C &/or D:

	 	 
	 	 	 
	
A. For Individual/Joint/UTMA/IRA Accounts:

	 	 
	 	 	 
	
Applicant:

	 	
Co-Applicant:

 

	
Name:  

	 	  	
Name: 

	 

	
(please include preferred title and/or suffix as applicable)

	 	
(please include preferred title and/or suffix as applicable)

 

	
Legal Residence Address:  

	 	 	Legal Residence Address: 	 

 

	 	 	 
	 	 	 
	
 

	 	 
	 	 	 
	 	 	 

 

	
Date of Birth:  

	 	 	
Date of Birth: 

	 
	 	 	 	 	 
	
Citizen/Domicile:  

	 	 	
Citizen/Domicile: 

	 

 

	
Social Security Number:  

	 	 	
Social Security Number:  

	 

 

	
Home Phone:  

	 	 	
Home Phone:  

	 
	 	 	 	 	 
	
Business Phone:  

	 	 	
Business Phone:  

	 
	 	 	 	 	 
	
Mobile Phone:  

	 	 	
Mobile Phone:  

	 
	 	 	 	 	 
	
E-mail Address:  

	 	 	
E-mail Address:  

	 

For UTMA accounts, note that the minor is the Applicant and the UTMA custodian is the Co-Applicant. The minor’s social security number will be used for tax reporting purposes. The UTMA custodian should sign this Application where indicated below and the attached signature cards.

 

Please complete IRS Form W-9 and return the form with this Application, unless you are a foreign person. If you are a foreign person, please complete Form W-8BEN (Certificate of Foreign Status) and return the form with this Application.

	
B.

	
For Corporate, Company or Partnership Accounts:

 

	
Corporate, Company or Partnership Taxpayer Identification Number: 

	
 

 

If you are a foreign corporate or partnership entity, please complete Form W-8BEN (Certificate of Foreign Status) and return the form with this Application.

 

	
You are organized/incorporated or a Partnership governed under the laws of: 

	
 

 

A copy of the Organization Agreement/Resolution under which you act should be attached to this Application.

 

2

	
C.

	
For Trusts, Estates, Pension/Profit Sharing Plans and Other Fiduciary Accounts:

 

	
Trust, Estate, Pension/Profit Sharing Plan or other Fiduciary Entity Taxpayer Identification Number: 

	
 

 

	
State law governing the Trust, Estate, Pension/Profit Sharing Plan or other Fiduciary Entity: 

	
 

 

If you are a foreign trust, estate or other fiduciary entity, please complete Form W-8BEN (Certificate of Foreign Status) and return the form with this Application.

 

	
Fiduciary(ies)/Trustee(s):

	 	
Fiduciary(ies)/Trustee(s):

 

	
1) Name:  

	 	 	
2) Name:  

	 

	
(please include preferred title and/or suffix as applicable)

	 	
(please include preferred title and/or suffix as applicable)

 

	
Citizen/Domicile:  

	 	 	
Citizen/Domicile:  

	 

 

	
Legal Residence Address:  

	 	 	
Legal Residence Address:  

	 

 

	 	 	 
	
 

	 	
 

	 	 	 
	
 

	 	
 

	 	 	 

 

	
Home Phone:  

	 	 	
Home Phone:  

	 
	 	 	 	 	 
	
Business Phone:  

	 	 	
Business Phone:  

	 
	 	 	 	 	 
	
Mobile Phone:  

	 	 	
Mobile Phone:  

	 
	 	 	 	 	 
	
E-mail Address:  

	 	 	
E-mail Address:  

	 

 

	
Fiduciary(ies)/Trustee(s):

	 	
Fiduciary(ies)/Trustee(s):

 

	
3) Name:  

	 	 	
4) Name:  

	 

	
(please include preferred title and/or suffix as applicable)

	 	
(please include preferred title and/or suffix as applicable)

 

	
Citizen/Domicile:  

	 	 	
Citizen/Domicile:  

	 

 

	
Legal Residence Address:  

	 	 	
Legal Residence Address:  

	 

 

	 	 	 
	
 

	 	
 

	 	 	 
		 	
 

	 	 	 

 

	
Home Phone:  

	 	 	
Home Phone:  

	 
	 	 	 	 	 
	
Business Phone:  

	 	 	
Business Phone:  

	 
	 	 	 	 	 
	
Mobile Phone:  

	 	 	
Mobile Phone:  

	 
	 	 	 	 	 
	
E-mail Address:  

	 	 	
E-mail Address:  

	 

 

For additional trustees, attach a separate information sheet to this Application.

 

3

If there are two or more fiduciaries or trustees acting at any time, we will follow the instructions provided by (check one box only):

 

	
☐ Any one of you

	
☐ A majority of you

	
☐ All of you

	
☐ Other (please specify):

	
 

	
 

	
 

	
 

	
 

	
 

	
 

	
 

 

(The attorney for the fiduciaries or trustee(s) should advise on this option.)

A full copy of the executed document under which you act must be attached to this Application.

	
D.

	
For IRA Retirement Accounts:

 

Plan Type (check one box only):

 

	
☐ Rollover IRA

	
☐ Roth IRA

	☐ SEP-IRA

 

Applicant’s Date of Birth: ______/______/______

 

For additional beneficiaries or to designate more than one primary or secondary beneficiary, attach a separate information sheet to this

 

	
Primary Beneficiary:

	 	
Secondary Beneficiary:

 

	
Name:  

	 	 	
Name:  

	 

	
(please include preferred title and/or suffix as applicable)

	 	
(please include preferred title and/or suffix as applicable)

 

	
Legal Residence Address:  

	 	 	
Legal Residence Address:  

	 

 

	 	 	 
	
 

	 	
 

	 	 	 
	
 

	 	
 

	 	 	 

 

	
Social Security Number:  

	 	 	
Social Security Number:  

	 

 

	
Date of Birth:  

	 	 	
Date of Birth:  

	 
	 	 	 	 	 
	
Relationship:  

	 	 	
Relationship:  

	 

Application.

 

By signing below, you hereby acknowledge that:

 

	
•

	
You certify that you are eligible to establish a traditional IRA, Roth IRA or SEP-IRA.

 

	
•

	
You have received and read the Citibank IRA or Roth IRA Agreement and Disclosure Statement. You accept the terms set forth therein as supplemented by this Agreement and you appoint Citibank, N.A. to be custodian of your Citibank traditional IRA, Roth IRA or SEP-IRA.

 

	
•

	
This Application is subject to, and will be performed in accordance with, the provisions of the Citibank IRA or Roth IRA Agreement and Disclosure Statement. This Application, however, will be controlling if any of its terms are inconsistent with the Citibank IRA or Roth IRA Trust Agreement.

 

	
•

	
If you invest in a mutual fund, you agree that such mutual fund or its affiliates may compensate Citibank, its subsidiaries or affiliate services. Further information is contained in the fund’s prospectus.

 

	
•

	
Any election to have a contribution treated as a Rollover cannot be revoked.

 

	
•

	
The contribution is made for the tax year indicated. If a tax year is not indicated, the contribution will be treated as a current year contribution.

 

	
•

	
You understand that each Citibank affiliate shares information about its transactions and experiences with you.

 

	
•

	
The general rules governing your Investment Options of the Traditional IRA or Roth IRA Plan Documents contain an arbitration provision and that your Traditional IRA or Roth IRA Account is governed by these terms.

Arbitration for Traditional IRA, SEP-IRA or Roth IRA Brokerage Accounts:

 

You are aware that the Citibank IRA, SEP-IRA or Roth IRA Agreement and Disclosure Statement contains a Pre-Disputed Arbitration Clause on page 3, therefore you acknowledge receipt of the Pre-Disputed Arbitration Clause and that your Traditional IRA, SEP-IRA or Roth IRA Account is governed by these terms.

 

4

By naming a beneficiary on this form, you cancel any earlier designation you may have made with respect to the assets in your Citibank Rollover IRA.

 

	
•

	
If you do not name your spouse as beneficiary, there may be income tax implications for your estate or beneficiary.

 

	
•

	
If you do not name a beneficiary, the beneficiary will automatically be your estate.

 

	
•

	
If you designate more than one primary beneficiary, the proceeds will be distributed equally among them unless you indicate otherwise.

 

	
•

	
Any secondary beneficiary you name will receive proceeds only if all of your primary beneficiaries are deceased.

 

	
•

	
If you designate more than one secondary beneficiary, the proceeds will be shared equally among them unless you indicate the share percentage for each.

	
2

	
Public Figure Information

 

Please complete either Section A or Section B:

 

Section A

 

Please check below if you or any of the co-applicants, trustees, fiduciaries or any other authorized signers are (or have been within the past five years):

 

	
☐

	
(i) a politician (whether elected or not) or significant government official who occupies, has occupied, or is actively seeking or being considered for a senior public position in the government or political party of a country, state or significant municipality;

 

	
☐

	
(ii) a government owned or controlled corporation, department or agency, or an executive thereof;

 

	
☐

	
(iii) a military officer;

 

	
☐

	
(iv) a close family member (e.g., spouse, parent, child, sibling, or in-law) of any of the above (i, ii, iii); or

 

	
☐

	
(v) a close associate of any of the above (i, ii, iii).

 

NOTE: “being considered for a senior public position” includes all individuals running for public office along with their senior campaign managers.

 

If you checked any of the above, please complete the section below:

 

	
Name:

	 

 

	
Office/Position Held:

	 

 

	
Date(s) Office/Position Held:

	 

 

	
If office held is a municipality, name of municipality:

	 

 

Section B

 

If no item in Section A applies to you, please check here:

	
3

	
Account Statements, Advices, Proxies/Notices and Tax Reporting

 

	
A.

	
Account Statements and Advices

 

The individuals and/or entities identified in Section I of this Application shall receive statements showing the assets and transactions in your Account for the statement period as selected in Section I of this Application.

 

Your statement will include any orders we execute on your behalf for the period to purchase and sell securities and invest cash, any income earned for the statement period in connection with the securities and cash held in the Account, and any transactions that occur in connection with the Account for the statement period.

 

At no additional cost to you, transaction advices and/or confirmations of all transactions conducted through your Account are generated as transactions occur and will be mailed to those individuals or entities identified in Section I of this Application.

 

If you have elected to have your statements and/or advices mailed to a designated representative(s) without a duplicate copy mailed to your legal residence or principal place of business, and/or if you have requested statements and/or advices be mailed to you at an address other than your legal residence or principal place of business, you agree a) that Citibank providing statements and/or advices to the designated representative(s) and/or to your mailing address is considered received by you, b) to indemnify Citibank against all loss, liability, costs, claims, damages, or expenses we may suffer resulting from complying with your request and c) to notify Citibank in writing of changes to this request.

 

	
B.

	
Corporate Reorganization/Class Action Notices and Proxies

 

If you have elected to have your corporate reorganization notices, class action notices and/or proxies mailed to a designated representative or to you at an address other than your legal residence or principal place of business, you agree to indemnify Citibank against all loss, liability, costs, claims, damages, or expenses we may suffer resulting from complying with your request and will notify Citibank in writing of changes to this request. Additionally, you agree that us providing corporate reorganization notices, class action notices and/or proxies to your designated representative is considered received by you. You understand that you or your designated representative is expected to vote proxies in such a manner as you deem to be desirable and then forward the executed proxies to the issuing company. You relieve us of liability if proxies inadvertently do not reach you or your designated recipient. You further understand that due to the difficulty in obtaining proxies in regard to any non-U.S. (i.e., foreign) securities, we will not provide you or your designated recipient with such proxies, and you relieve us of all responsibility in connection therewith.

 

5

	
C.

	
Tax Reporting

 

Applicable tax reporting information will be provided to the parties identified in Section I of this Application. For a separate fee (see

the Schedule of Fees provided with this Application), at your request we will provide you with an annual summary of income collected, classified for federal and state income tax purposes, and other pertinent information to assist with annual tax return preparation. Check below to receive this report.

 

	
☐

	
Prepare an annual tax summary report for this Account. The tax reporting information recipients identified in Section I above should receive this report unless otherwise notified in writing.

	
4

	
Administrative Matters

	
A.

	
Principal and Income Cash Balances

 

At your discretion, cash balances held in your Account may be segregated into principal and income cash balances. This option is often used for fiduciary accounts that require interest, dividends and other earnings be kept separate from principal balances. We will keep:

 

	
☐ Separate accounts for principal and income balances. 

	
☐ A combined principal and income account.

 

	
B.

	
Fees, Charges and Expenses

 

Our fees and charges for services in connection with this Account are set forth in the Schedule of Fees or other written notice delivered to you from time to time. By signing this Application, you authorize us to charge all such fees and expenses when due to your (if applicable, indicate the percentage of fees which should be charged to each of the income and principal cash accounts):

 

	
☐ Income cash account

	 	
%

	
☐ Charge fees to other Citi Account

 

	
☐ Principal cash account  

	 	
%

	
☐ Invoice fees

 

	
☐ Combined principal and income cash account  

	 	
%

 

If you have chosen separate accounts for principal and income balances in section 4A above and have not completed section 4B, the charges for our fees will automatically be charged to the income cash account. If the balance in your Account is insufficient to cover our fees and charges, you hereby authorize us to charge any other account you may have with us.

 

For Trusts, Estates, Pension/Profit Sharing Plans and other Fiduciary accounts, the attorney for the fiduciary should advise on this option.

	
C.

	
Mutual Fund Investments

 

	
☐

	
Yes, I plan to invest in Mutual Fund Investments

 

By checking the above you acknowledge that all mutual fund transactions are subject to further guidelines and provisions that are outlined in the fund prospectus which will be reviewed prior to sending trade instructions to us.

	
D.

	
Reinvestment Options

 

Please select one of the below for your reinvestment choice:

 

	 	
☐

	
Reinvest both Dividends and Capital Gains

 

	 	
☐

	
Reinvest Dividends Only

 

	 	
☐

	
Reinvest Capital Gains Only Do Not Reinvest

 

	 	
☐

	
Will provide reinvestment choice at time of trade

	
E.

	
Global Custody Investments

 

	
☐

	
Yes, I wish to establish a Global Custody Account to hold foreign currencies and/or invest in foreign securities held and settled in foreign markets.

 

By checking the above you acknowledge that the investments held in the Account may be subject to Global Custody Fees set forth in the Schedule of Fees Form.

 

	
F.

	
Standing Instructions - Automatic Account Remittance

 

Cash balances held in your Account can be remitted automatically on a periodic basis as you direct. The remittance instructions stated below will remain in effect until you notify us otherwise in writing.

 

	
☐

	
No automatic account remittance at this time.

 

(A separate instruction letter can be provided at a later date to add a remittance to your account.)

 

	
☐

	
Please remit cash as follows:

 

	
Select one:

	
Select one:

	 
	
☐ Income cash remittance

	
☐ Send remittance by wire transfer

	
☐ Send remittance by ACH

	
☐ Principal cash remittance

	
☐ Send remittance by check

	 
	
☐ Combined principal and income account remittance (see A above)

 

6

	
Remittance Date: 

	 
	
Amount:  

	 
	
To: 

	 

 

Note that “principal balance” remittances are not permissible. Remittances from a principal account or a combined principal and income account must be a fixed dollar amount.

 

Wire Transfer Instructions or Check Delivery Instructions:

	
 

	
 

	
 

	
 

 

Citibank is not required to call you to verify or confirm the validity of your instructions to transfer funds provided that each transaction has the same debit and credit information indicated above. You hereby release Citibank from, and agree to indemnify and hold harmless Citibank and its affiliates, and their respective officers, directors and employees from and against any and all claims, losses, damages and liability (including reasonable attorneys’ fees) arising out of its compliance with the foregoing authorization. This authorization supersedes any prior contrary instructions covering the funds transfer instructions described above. This authorization shall remain in effect until Citibank receives written notice of its cancellation or modification and has had sufficient time to act on such notice.

	
G.

	
Tax Lot Accounting Method

 

The default tax lot accounting method utilized by Citibank for sales of securities executed through your Account is FIFO (first in, first out). If an alternative method is preferred (i.e., “last in, first out” (LIFO)) please indicate below:

	
 

	
 

 

Changes to these instructions can be made in writing as necessary. Please consult your tax advisor for further information on completing this section.

	
H.

	
SEC Shareholder Disclosure Rule 14b-2

 

SEC Rule 14b-2 directs us to request your authorization to provide your name, address and share position with respect to your Account to requesting companies whose stock you have voting authority over. Under the Rule, we must make the disclosures for accounts opened after December 28, 1986, if requested, unless you specifically object to disclosure. Hence, failure to respond will be deemed consent to disclose. Thank you for assisting us in complying with this SEC rule.

 

	
☐

	
Yes, you authorize us to release your name, address and share positions.

 

	
☐

	
No, you do not authorize us to release your name, address and share positions.

	
I.

	
Multiple Accounts

 

From time to time, you may instruct us to open and maintain more than one Account for the individual or entity described in the “Accountholder Information” above. Unless otherwise instructed in writing, this Application will govern all such accounts established.

	
5

	
Cash Management

 

Selected Sweep Fund. At the end of each business day, all United States Dollars (“USD”) held in an Account can be automatically invested in a money market vehicle. As an alternative to the Citibank Market Deposit Account described below, you may elect to have your USD cash balances swept into certain money market mutual funds. For information on money market mutual fund alternatives, please consult your Private Banker or Relationship Officer. By authorizing us to automatically sweep USD cash balances into your chosen money market mutual fund, you represent that the prospectus for the money market mutual fund you have chosen has been made available to you. By checking the appropriate box below, indicate the money market vehicle into which all principal and income cash balances should be invested:

 

	
☐

	
Citibank Market Deposit Account, an FDIC insured money market deposit account of Citibank, N.A. (Before choosing this option, please see below the “IMPORTANT NOTE REGARDING FDIC INSURANCE LIMITATIONS”).

 

	
☐

	
Other:

	 

 

	
☐

	
None. All cash in this Account should be held in a non-interest bearing deposit of Citibank, N.A. (Before choosing this option, please see below the “IMPORTANT NOTE REGARDING FDIC INSURANCE LIMITATIONS”).

 

The prevailing interest rate will be paid to you and earnings on your cash balances will be reflected on your Account statement.

 

If you do not specify a cash investment, you will have been deemed to have authorized us to invest all principal and income cash balances in your Account in the Citibank Market Deposit Account. With respect to cash balances in your Account that you direct or authorize us to invest into money market instruments and/or deposits which are obligations of, or mutual funds managed or serviced by Citibank or related entities, you recognize that, in addition to fees provided for herein, we or a related entity may have an interest therein and such affiliated organization may also receive fees or other profits or benefits from such investment as described more fully in the “Preferred Custody Services Terms & Conditions” booklet under the header ”Revenue Sharing Payments”. You hereby authorize the receipt of such fee, profit or benefit and expressly waive any special computation or accounting.

 

7

IMPORTANT NOTE REGARDING FDIC INSURANCE LIMITATIONS. Both the Citibank Market Deposit Account (“MDA”) and any amounts held as non-interest-bearing USD deposits are FDIC insured deposit accounts of Citibank, N.A. and are insured by the FDIC up to the maximum amount allowable by the FDIC. Any other deposits, including checking accounts, savings accounts or certificates of deposit (“CDs”) you maintain with Citibank, N.A. in the same capacity, directly or through an intermediary such as a brokerage account, will be aggregated with your MDA and/or non-interest-bearing deposits for purposes of determining the applicable FDIC insurance limit. If Citibank, N.A. fails, the aggregated deposit accounts you maintain are insured, up to the applicable limits, for principal and interest accrued to the day Citibank, N.A. is closed. It is your responsibility to monitor the total amount of deposits that you maintain with Citibank, N.A. and to determine the extent of FDIC insurance coverage available to you. We shall have no responsibility to monitor your deposits.

 

Foreign Currency Balances. If you instruct us to hold foreign currency balances in your Account, you understand and agree that such balances will be held in a non-interest-bearing account that is not subject to FDIC insurance.

	
6

	
Third Party Instructions

 

If you wish to designate a representative to give us investment or other instructions regarding this Account, please complete The Citi Private Bank Preferred Custody Services Third Party Designation or Citi Private Bank Appointment of Investment Counsel Form, as applicable.

 

For Trusts, Estates, and other Fiduciary accounts, the attorney for the fiduciary should advise whether, and the extent to which, the fiduciary’s authority with respect to this Account may be delegated to a third party.

	
7

	
Client Website Access and Enrollment

The Citi Private Bank Client Website (the “Client Website”) is a powerful and comprehensive tool that allows you and your designated representatives to monitor your Account(s) with greater power and precision. Detailed information about the Client Website is available from your Citi Private Bank representative. An online tour is available at www.citigrouppb.com.

 

If you wish to access information about your Account via the Client Website, or if you would like to permit one or more representatives to access information about your Account via the Client Website, please complete the following. Your Citi Private Bank representative will contact the individuals named below to complete the enrollment process.

 

	
Name:  

	 	 	
Name:  

	 
	 	 	 	 	 
	
Address:  

	 	 	
Address:  

	 

 

	 	 	 
	 	 	 
	 	 	 

 

	
E-mail Address:  

	 	 	
E-mail Address:  

	 

 

	
Phone:  

	 	 	
Phone:  

	 

 

For additional individuals, attach a separate information sheet to this Application.

	
8

	
Execution of this Application

 

Please read before signing.

 

APPLICATION

 

You are applying for the accounts and services covered by this Application and you may apply later for other accounts and services covered by this Application pursuant to “Subsequent Accounts and Services” below.

 

AGREEMENTS/ACKNOWLEDGEMENTS/CERTIFICATIONS

 

By signing below, you acknowledge that you have read, understood and agree to this Application, Citi Private Bank Preferred Custody Services Terms & Conditions, Schedule of Fees, Citi Private Bank Privacy Promise, Client Funds Transfer Agreement, and all other documents enclosed herewith (collectively, the “Enclosed Documents”) or included with or hereafter delivered in connection with any now or later applied for account or service covered by this Application, all of which (without need to separately sign) are part of the agreements contained herein. Your signature below shall also be deemed to be your execution of the agreements attached hereto and all other documents enclosed herewith or included with or hereafter delivered in connection with any now or later applied for account or service covered by this Application, as if your original signature appeared thereon. This Application may be executed in any number of counterparts, all of which together shall constitute a single instrument. You may deliver an executed counterpart of a signature page to this Application to us by telecopier, which shall be as effective as delivery of a manually executed counterpart of this Application. This Application, when accepted by us, forms your agreement with us. For the purpose of referring to this Application, the date of this Application shall be the date of acceptance by Citibank.

 

8

By signing below, you certify that:

 

	
•

	
You are 18 years of age or older and that the information provided in this Application or in connection herewith, whether now or hereafter, is accurate, complete and verifiable.

 

	
•

	
In consideration of the opening or granting of any account or service covered by this Application, you have the authority to request and apply for same.

 

	
•

	
You have received the Enclosed Documents.

 

	
•

	
Copies of all trust agreements, wills, court orders and other documents or agreements that you now or hereafter provide to Citibank are in full force and effect, genuine, complete, unaltered, and have not been modified, repealed or superseded.

 

	
•

	
If you are a retirement plan subject to the Employee Retirement Income Security Act of 1974 (“ERISA”), by opening an account or obtaining a service under this Application, your signature below constitutes your acknowledgement that you reviewed the Citi Private Bank Preferred Custody Services ERISA Section 408(b)(2) Disclosure Document made available to you reasonably in advance of your deciding to open the Account and that after your review, you made an independent decision that the fees and other compensation are reasonable for the services being provided by Citibank. Your signature further acknowledges that you consent to Citibank updating or changing the Disclosure Document by posting updated documents and/or notices at http://citi.com/investorinfo/advisoryprivacy/408b2disclosures.html and that it is your responsibility to check the website periodically for such updates.

Under this Application, you authorize us to open on your behalf a Citi Private Bank Preferred Custody Services Account for the safekeeping of securities, cash and other investments that you purchase or sell through Citibank, N.A., Citigroup, or other parties based on your own or your advisor’s investment decisions and instructions. We will act as depository for the safekeeping of the cash and securities in your Account in accordance with the terms of this Application. You (or your designated representative, if applicable) will have the sole discretion to direct investments and you agree that only securities owned by you will be held in your Account.

 

You also agree:

 

	
•

	
All accounts and services are subject to the agreements, rules, regulations, terms, conditions and disclosures therefore as in effect from time to time.

 

	
•

	
You acknowledge that you are solely responsible for, and that neither WE nor any other Affiliated Organizations have any responsibility for, your compliance with any laws, regulations or rules applicable to your use of the services provided by us under your Agreements with us, including, but not limited to, any laws, regulations or rules, in your or any other jurisdiction, relating to tax, foreign exchange and capital control, and for reporting or filing requirements that may apply as a result of your country of citizenship, domicile, residence or taxpaying status.

 

	
•

	
This Application will remain the property of Citibank and will not be returned to you.

 

	
•

	
Citibank may record telephone conversations with you.

 

	
•

	
Citibank may, from time to time, fax you information on products and/or services that are available to clients of Citi Private Bank using any fax numbers provided in this Agreement, provided by you during the course of your relationship with Citibank and/or provided in a directory, advertisement or site on the Internet to which you voluntarily agreed to make available your fax number for public distribution.

 

	
•

	
Citibank may require you to provide additional information or documentation, to update information previously given, to submit additional applications, and to sign additional documentation.

 

	
•

	
Citibank may from time to time make additions to the accounts and services available pursuant to this Application. You may contact your Citi Private Bank Representative for this information and apply for or request such accounts or services as if they were named in this Application. Your application or request shall be deemed to be an application or request pursuant to “Subsequent Accounts, Credit and Services” below. You will receive a copy of the agreement, rules, regulations, terms, conditions and applicable disclosures for any such account or service you are granted, all of which shall be part of the agreements contained herein. You agree that Citibank may require you to sign additional documentation in connection with such account or service.

 

	
•

	
This Application is to be governed by the laws of the State of New York and by federal law as applicable. Any dispute in connection with this Application shall be adjudicated in a federal or state court located in the Borough of Manhattan, City and State of New York. You agree to submit to the jurisdiction of such courts for the determination of all issues in connection with this Application and irrevocably waive any objection to venue or inconvenient forum. You waive trial by jury in any such dispute.

Your signature below acknowledges that Citibank shall not incur any liability for not performing any act or fulfilling any obligation hereunder by reason of any occurrence beyond its control (including, but not limited to, any provision of any present or future law or regulation or any act of any governmental authority, any act of God or war or terrorism, or the unavailability of the Federal Reserve Bank wire services or any electronic communication facility). You further agree that no printed or other material in any language, including prospectuses, notices, reports, and promotional material which mentions Citibank or Citigroup by name or the rights, powers, or duties of Citibank or Citigroup under this Application shall be issued by any other parties hereto, or on such party’s behalf, without our prior written consent.

 

FUNDS TRANSFER

 

You agree that:

 

	
•

	
without prior notice, Citibank may at any time refuse to accept funds transfer instructions.

 

	
•

	
Citibank is not required to call you, a designated representative or an authorized signer to verify or confirm the validity of any standing or pre-defined instruction to transfer funds provided that each transaction has the same debit and credit information you have given for such instruction

 

	
•

	
You are bound by instructions given by your designated representatives and authorized signers; any errors resulting from misinformation provided by your designated representatives and authorized signers are your responsibility and Citibank may accept instructions from designated representatives and authorized signers until your Citi Private Bank Representative is notified by signed written instruction (original, facsimile, pdf) of any changes and Citibank has had sufficient time to act upon such notices.

 

9

AUTHORIZATIONS

 

You authorize:

 

	
•

	
Citibank from time to time to investigate and verify any information contained in or obtained now or later in connection with this Application, to check your credit history and obtain consumer and/or credit reports in connection with any account or service for which you now or may hereafter apply. If you ask, you will be told whether or not a consumer and/or credit report on you was requested and the name and address of the agency that furnished the report. To facilitate your application for, and when activated the maintenance of, accounts and services covered hereunder, you consent to Citibank’s exchange of your consumer and/or credit reports, this Application, any information about you, your accounts or services, and any other document delivered now or later in connection herewith with its affiliates.

 

	
•

	
Your employer, your bank, and any other references supplied on or in connection with this Application now or later or which appear on your consumer or credit reports to release and/or verify information to Citibank.

 

	
•

	
Citibank to share with credit bureaus, affiliates and other proper persons information about your creditworthiness and how you handle your accounts and services.

 

SUBSEQUENT ACCOUNTS, CREDIT AND SERVICES

 

You authorize Citibank to accept instructions from you to open and close accounts and to request or terminate any account service covered by this Application, without requiring further original signatures from you. Unless you have advised Citibank to the contrary, your delivery to Citibank of any such instructions shall be confirmation that there are no material adverse changes in the information you have given in this Application.

 

AGENT/POWER OF ATTORNEY

 

You appoint Citibank as your agent and attorney-in-fact to take your instructions: to open any account and to request any service covered by this Application and to communicate the same to its affiliate offering such account or service for purposes of applying for, enrolling in or requesting the same on your behalf and/or to terminate or modify any account or service.

 

PRIOR AGREEMENTS, TERMINATION, INDEMNIFICATION

 

	
•

	
This Application and the agreements contained herein supersede any prior contrary information, agreements, authorizations or instructions covering accounts and services covered by this Application, and remain in effect until your Citi Private Bank Representative receives written notice of cancellation or an approved modification and Citibank has had sufficient time to act upon such notice. Citibank may terminate your relationship as a Private Bank customer, with or without cause, at any time and without prior notice to you. Provisions for termination of specific accounts or services are set forth in Citi Private Bank Preferred Custody Services Terms & Conditions and other governing documents.

 

	
•

	
You release Citibank from, and agree to defend, indemnify and hold harmless Citibank, its officers, directors and employees from and against, all claims, losses, costs, damages, expenses and liability (including reasonable attorneys’ fees) arising out of its complying with or acting in reliance upon this Application.

 

SIGNATURES

 

IN WITNESS WHEREOF, the undersigned have duly executed this Application (all account owners must sign):

 

	
Signature:  

	 	 	
Signature:  

	 
	 	 	 	 	 
	
Print Name:  

	 	 	
Print Name: 

	 
	 	 	 	 	 

	
Capacity of Signatory:  

	 	 	
Capacity of Signatory:  

	 
	
(If other than individual or joint account)

	 	
(If other than individual or joint account)

	 	 	 	 	 

	
Date:  

	 	 	
Date: 

	 
	 	 	 	 	 
	
Signature:  

	 	 	
Signature:  

	 
	 	 	 	 	 
	
Print Name:  

	 	 	
Print Name: 

	 
	 	 	 	 	 

	
Capacity of Signatory:  

	 	 	
Capacity of Signatory:  

	 
	
(If other than individual or joint account)

	 	
(If other than individual or joint account)

	 	 	 	 	 

	
Date:  

	 	 	
Date: 

	 

 

 

10

SECTION TO BE COMPLETED BY CITIBANK

 

Accepted by Citibank:

 

	
Signature: 

	 	
 

	
Name:  

	 
	
 

	 	
 

	
 

	 
	
Title: 

	 	
 

	
Date: 

	 
	
 

	 	
 

	
 

	 

	
Account Number: 

	 

 

 

 Citi Private Bank is a business of Citigroup Inc. ("Citigroup"), which provides its clients access to a broad array of products and services available through bank and non-bank affiliates of Citigroup.  Not all products and services are provided by all affiliates or are available at all locations. Neither Citigroup nor any of its affiliates provide tax or legal advice.  Custody Services are provided by Citibank N.A.

 

Citi and Citi with Arc Design are registered service marks of Citigroup Inc. or its affiliates.

 

	
© 2013 Citigroup Inc. All rights reserved 

	
Citibank, N.A. Member FDIC

 

	
INVESTMENT PRODUCTS: NOT FDIC INSURED • NO BANK GUARANTEE • MAY LOSE VALUE

 

11

 

PREFERRED CUSTODY SERVICES

Terms and Conditions

 

Table of Contents

	
•

	
Services Provided

	
2

	 	
— Custody

	
2

	 	
— Client Website Access

	
2

	 	
— Statements and Confirmations

	
3

	 	
— Securities Processing

	
3

	 	
— Settlement

	
 4

	 	
— Foreign Exchange Transactions

	
 4

	 	
— Restricted Transactions

	
5

	
•

	
Account Fees

	
5

	
•

	
Referral Fees

	
5

	
•

	
Revenue-Sharing Payments

	
5

	
•

	
Grant of Lien

	
6

	
•

	
Right of Offset

	
6

	
•

	
Taxes and Expenses

	
6

	
•

	
Legal Process

	
7

	
•

	
Valuation

	
7

	
•

	
Representations and Warranties

	
7

	
•

	
General Agreements and Authorizations

	
8

	 	
— Subsequent Accounts, Credit and Services

	
8

	
•

	
Account Types

	
9

	 	
— Joint Accounts With Rights of Survivorship

	
 9

	 	
— Trust/Fiduciary Accounts

	
 9

	 	
— Custodial (Uniform Transfers to Minors Act/Uniform Gifts to Minors Act) Accounts

	
 9

	 	
— Entity Type Accounts

	
 9

	 	
— Individual Retirement Arrangement Accounts (IRA)

	
 9

	
•

	
Corporate Reorganization/Class Action Notices and Proxies

	
10

	
•

	
Dormant Accounts

	
10

	
•

	
Termination of Preferred Custody Services Agreement

	
10

	
•

	
Governing Law and Submission to Jurisdiction

	
10

	
•

	
Citibank Obligations in Respect of an Account

	
11

	
•

	
Limitation of Liability

	
11

	
•

	
Severability

	
11

	
•

	
Amendments

	
11

	
•

	
Electronic Delivery

	
11

	 	
— Notices, Disclosures, etc

	
11

	 	
— Account Data

	
 12

	
•

	
Other Activities of Citibank and Citigroup Affiliates

	
13

	
•

	
Investment Risks

	
14

	 	
— General

	
14

	 	
— Cash and Short-Term Investments

	
14

 

Citi Private Bank Preferred Custody Services are offered to clients of Citi Private Bank - a business of Citigroup Inc. (“Citigroup”) that provides clients access to products and services worldwide through bank and non-bank affiliates of Citigroup. Unless otherwise indicated in these Terms & Conditions or in the Preferred Custody Services Account Application (“Application”), “you,” “your” and “yours” mean the person and/or entity named in the Application under “Accountholder Information,” as the owner or holder of each custody account established by you hereunder (each an “Account”). Where the context so admits, “you,” “your” and “yours” also refer to any representative designated to give us instructions on behalf of the holder(s) or owner(s) of the Account(s). All references in the Application and Terms & Conditions to “Citibank” mean Citibank, N.A. and its successors. All references to “Citigroup” means Citigroup Inc., Citigroup’s affiliates and its successors, including Citibank, their branches and subsidiaries, wherever located. Unless otherwise indicated in the Application and Terms & Conditions, “we,” “us” and “our” mean Citibank, and where appropriate, Citi Private Bank (“CPB”) Preferred Custody Services, its successors and assigns and capitalized terms have the meanings provided in the Application and Terms and Conditions.

 

The Application for the Preferred Custody Services, together with these Terms & Conditions establishes your private banking relationship with us. The Application, together with the Terms and Conditions, is hereinafter referred to as the “Agreement” and represents the entire agreement between us with regard to the services described herein and supersedes any previous agreement to the extent of any inconsistency or contrary provision. In the event of any inconsistency between the Agreement or any other document you have entered into with us with respect to the services and fees described herein, the provisions of the Agreement shall control. Citibank may from time to time introduce new or additional terms and conditions governing your relationship with Citibank hereunder or hereafter, and such terms and conditions, unless otherwise specified, shall be effective when forwarded to the address specified by you in the Application. 

 

We can refuse to accept or renew this Agreement in our sole discretion and for any reason. We can also refuse to accept this Agreement until such time as you deliver the funds that will be administered into our custody. Unless otherwise instructed, your assets will remain in the form delivered prior to our acceptance of this Agreement. Collection and processing may delay our acceptance of this Agreement. We may at our discretion, decline any asset(s) that you propose to deliver to be maintained in an Account.

 

 

Services Provided

Custody

 

Preferred Custody Services, a business unit of Citibank, shall act as your custodian (the “Custodian”) for accounts referenced in this Agreement and described in the sales material. The Custodian will assign a Senior Custody Product Specialist and a Custody Service Officer to each Account.

The assigned Custody Service Team will provide professional portfolio administration to investors who seek to consolidate accounts and simplify securities record-keeping and safekeeping

 

Citibank will maintain custody of the assets held in an Account. Such assets will be segregated from the general assets of the Custodian and the Custodian will maintain detailed records to ensure that assets held in an Account can be identified and traced. For Global Custody accounts (accounts holding foreign currencies and/or foreign securities held and settled in foreign markets), Citibank shall have the power and authority to appoint one or more subcustodians, including entities both affiliated and unaffiliated with Citigroup, to hold assets in an Account. You understand that Citibank may have an interest therein and such affiliated organization may receive fees or other profits or benefits, in addition to any fees charged to your Account.

All dividends, interest and principal paid in connection with securities held in an Account shall be credited to that Account.

All or a portion of an Account may be held in cash or cash equivalents, including securities issued by money market mutual funds. At the end of each business day all US dollar cash held in an Account, which has not been invested, will be transferred to a money market investment, which has been selected by you. If you do not specify a cash investment, you will have been deemed to have authorized us to invest all principal and income cash balances in your Account in the Citibank Market Deposit Account. With respect

to cash balances in your Account that you direct or authorize us to invest into money market instruments and/or deposits which are obligations of, or mutual funds managed or serviced by Citibank or related entities, you recognize that, in addition to fees provided for herein, we or a related entity may have an interest therein and such affiliated organization may also receive fees or other profits or benefits from such investment as described more fully under the header “Revenue Sharing Payments”. You hereby authorize the receipt of such fee, profit or benefit and expressly waive any special computation or accounting.

 

If you instruct us to hold foreign currency balances in your Account, you understand and agree that such balances will be held in a non-interest bearing account that is not subject to FDIC insurance.

Client Website Access

By completing the Client Website and Enrollment section of the Application, you, the client or authorized signer(s) for the client, request enrollment in The Relationship Report and authorize Citi Private Bank, to provide third parties designated as the Web User and/or Recipient as designated in the Application with account information with respect to the account you are opening along with all the accounts maintained under the Entitlement Groups and/or the Accounts listed, or any other accounts directed by you from time to time, through access to The Relationship Report on the Web via the Citi Private Bank client Web site (“Web Report”) and/or the physical delivery of The Relationship Report (“Paper Report”),  as  directed.  The  Relationship  Report  on  the  Web will be made available to the Web User through the Citi Private Bank client Web site only when the Client Website Access and Enrollment section of the Application has been completed to the Citi Private Bank’s satisfaction and signed by you, when applicable, and the Web User accepts Citi Private Bank client Web site Terms and Conditions and User Agreement, upon initial log in to the Citi Private Bank client Web site. You understand that this authorization and instruction will not be automatically terminated should you die, become incapacitated, become insolvent or declare bankruptcy, or be declared absent, but will remain in force until revoked in writing by you or your legal representative.

	
 

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For security purposes, we will send your user name and password separately, using two different delivery methods. Your user name, along with instructions for logging on to the site, will be sent via e-mail to the address that you provide. Your initial password will be shipped via expedited postal mail to the address that you provide. A signature is required for receipt of this package. Please Note: We are unable to deliver to P.O. Box addresses. You will need BOTH, your user name and initial password, to activate your account on the client Web site.

The Relationship Report describes those products and services made available to you through the Citi Private Bank, which are provided by or in custody at Citibank, N.A. (“Citibank”), Citigroup Global Markets Inc. (“CGMI”), and other Citigroup affiliates. The information provided in The Relationship Report is subject to all applicable terms and conditions, including those governing the specific accounts and transactions referenced herein. If the Report is being delivered to you electronically via Citi Private Bank client Web site or otherwise, it is subject to the terms and conditions governing such electronic delivery. The information in The Relationship Report is not intended as a recommendation or an offer or solicitation to sell any securities or investments. The data contained in The Relationship Report is for informational purposes only and should not be used to make a decision to buy or sell a security, fund or other investment or for the benefit or use of any third party. All products are offered subject to approval, eligibility, and all applicable terms and conditions governing the specific accounts and/or transactions. In the U.S., brokerage services may be provided by CGMI, member SIPC, and an affiliate of Citibank. Outside the U.S., brokerage services may be provided by other Citigroup affiliates. Products are held at Citibank, Citibank International PLC, CGMI, and other Citigroup affiliates.

 

The Relationship Report is a supplement to, and does not replace, the official legal statements you receive for your Preferred Custody Services account(s).

Statements and Confirmations

Your  monthly  or  quarterly  statement,  as  requested  in  the Application,   will   contain   a   summary   of   all   transactions executed for the Account. If you wish (at no additional cost to you) confirmation upon completion of each transaction in an Account, ensure that you have checked the relevant boxes on the Application under Section 1, “Accountholder Information.”

Citibank will mail an account statement to your legal residence or principal place of business at least quarterly.  If you have elected to have duplicate statements, advices and/or proxies mailed to a designated representative(s) or mailed to you at an address other than your legal residence or principal place of business, you agree a) that Citibank providing such duplicate statements, advices and /or proxies to the designated representative(s) and/or to your secondary mailing address is considered received by you, b) to indemnify Citibank against all loss, liability, costs, claims, damages, or expenses we may suffer resulting from complying with your request and c) to notify Citibank in writing of changes to this request.

Each statement or notice is sent in accordance with the written instructions provided in the Agreement. Notification given to any one owner is considered notification to all owners of the account. We use ordinary mail or electronic mail for delivery and pay all postage (when applicable). All statements and notices (including any returned to us as undeliverable) are considered delivered to you on the date we first place them in the mail or the date the electronic mail is first sent. We are not responsible for statements or notices lost in transmittal. If two consecutive statements and/ or notices are returned to us for any reason, you agree that we may hold subsequent notices and statements until we receive forwarding information from you.

We reserve the right to correct errors on any Account statement or confirmation sent to you. If you fail to notify us concerning any error in an Account within sixty (60) days from the date you receive notification of the transaction in question, any claim by you will be barred, if permitted under applicable law.

Securities Processing

 

Investments may be made in a variety of types of securities, including, but not limited to, common and preferred stocks, convertible stocks or bonds, warrants, options, rights, corporate, municipal   or   government   bonds,   notes   or   bills   of   other instruments (collectively, “Securities”). Only Securities that you own will be held in the Account.

All directions to buy or sell securities or invest cash will come from you or such person or persons as you designate and will be subject to all relevant market rules and regulations and our practices and procedures, either of which can change from time to time.

In its capacity as your custodian under this Agreement, you agree that:

	 	
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Citibank Preferred Custody Services shall not be responsible for the management of any Assets held in any Account or for the investment management decisions of any investment manager selected by you.

 

	
 

 

	
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You or the investment manager for an Account will be solely responsible for the management of the Assets in that Account.

 

	 	
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You or the investment manager identified by you shall invest and reinvest the Assets held in your Account in accordance with your investment objectives and risk tolerance levels.

 

	 	
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Each order you place is based on your or your financial advisor’s independent evaluation of the risks and merits of the investment and determination that the security is consistent with your investment objectives, risk tolerance and financial capacity.

 

	 	
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You  accept  full  responsibility  for  all  risks  and  losses associated with the orders you place.

 

	 	
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If you do not specify the market in which you wish us to execute your order, we may complete the transaction in the market of our choice.

 

	 	
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Citibank shall default to the First In First Out (FIFO) tax lot accounting method for sales of securities executed in your account unless otherwise instructed by you in writing.

	
 

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Unless you otherwise instruct, we may refer orders to purchase or sell securities to any Citigroup affiliated organization which may act as counterparty, principal, agent, underwriter or broker, even though we may have an interest therein and such affiliated organization receives fees or other profits or benefits, in addition to any fees charged to your Account.

 

	 	
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We may, at our discretion, refuse to execute the sale of a security which is not in your Account established pursuant to this Agreement. Further, if you sell a security which is defective or not delivered for timely settlement, we may at our discretion purchase the security at your expense to cover the sale.

 

	 	
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We will not be responsible for any error, default, omission, or neglect of any broker or telecommunications firm or if any transaction is delayed and cannot be effected by reason of any cause beyond our control.

 

	 	
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Fractional shares of securities received into your Account as a result of a corporate reorganization matter, dividend payment or other transaction cannot be held in your Account. With respect to any fractional shares that are received, we will automatically sell such shares and credit the proceeds to your Account.

For securities and any other investments purchased in connection with your Account (including securities purchased by us to satisfy your orders to sell, as described above), you agree that you will have on the settlement date the full purchase price of the securities in U.S. Dollars, or any other currency as appropriate to settle non-US Dollar denominated security transactions, in immediately available funds in your Account, or such other account with us as we may agree upon with you at the time of the trade. If you do not, you will be in default in the payment of this debt obligation and we may, without further notice or demand and at our option in any order, charge any account you have with us and/or sell any assets held in your Account or any other account with us (including the purchased securities) to recover the purchase price and any fees or charges in connection with the recovery. Should you not have sufficient cash or assets with us to satisfy this debt obligation, we may then seek to recover from you any deficiency.

If you direct us to buy and/or hold securities of non-U.S. (i.e., foreign) companies or other entities, you authorize us to hold these securities in such foreign country where the principal trading market is located and, in connection therewith, to deposit these securities with a branch of Citibank or other U.S. bank in such foreign country, a foreign bank acting as custodian or a foreign securities depository in which we participate, and to pay all fees and expenses attendant thereto even if securities are deposited in a branch of Citibank. You understand that Citibank may have an interest therein and such affiliated organization may receive fees or other profits or benefits, in addition to any fees charged to your Account. You understand that in addition to the standard risks of investing in securities, investment in non-U.S. companies or entities could result in substantial loss of principal due to foreign exchange risk or sovereign risk including, but not limited to, the devaluation of the currency in which the security is denominated or the imposition of foreign exchange controls restricting ownership of the security by non-citizens, currency conversion or the transfer of funds outside the foreign jurisdiction. A loss in value of such non-U.S. investments could

also occur if foreign exchange control regulations are imposed that  make  it  difficult  or  impossible  to  convert  the  foreign currency to U.S. Dollars and/or return these foreign funds to us in the United States. Further, a partial or complete loss of your non-US investment may occur if a private company is acquired, or nationalized, by a foreign government or one of its agencies.

 

Settlement

You  hereby  appoint  Citibank  as  your  agent  and  custodian with respect to facilitating the settlement of security trades, purchases and sales, at the discretion of you or your designated representative. Pursuant to such authorization, the Custodian may, at your risk, arrange for delivery and payment in connection with the settlement of security trades. In addition, you authorize us to register securities in Citibank’s name, or the name of a nominee, and agree that Citibank and the Custodian may act on your behalf in all other matters necessary or incidental to the handling of each Account, including signing your name, delivering any required endorsements or assignments, guaranteeing your signature to transfer securities and certifying your ownership of the securities in each Account to government authorities (including, without limitation, government authorities in the United States and the jurisdiction of your domicile).

You hereby agree to pay us promptly on demand for any and all losses incurred by us as a result of the settlement of trades executed by you or your designated representative, and to cover any debit balance resulting from such trading. This settlement authorization shall not be affected by your subsequent disability or incapacity. If, in the event of your death, we act in good faith pursuant to this settlement authorization without actual knowledge of your death, any action so taken, unless otherwise invalid or unenforceable, shall be binding on your successors in interest.

For an Individual Account upon notice to the Custodian of your death, we will cease all activity in each Account pending further instructions from the appropriate party representing your estate.

This settlement authorization is a continuing one and shall remain in full force and effect until terminated by you or us in writing. The termination of this authorization will also terminate this Agreement. If an Account becomes inactive or if we cannot communicate with you because of a change of address or otherwise, we may be required to comply with local regulations dealing with such issues.

Foreign Exchange Transactions

You agree that we may facilitate foreign exchange transactions with Citibank or other Citigroup affiliates, that such transactions will be effected at the prevailing exchange rate as determined by the entity effecting the transaction in its sole discretion, and that, if a foreign exchange transaction is effected through a Citigroup affiliate, such affiliate may receive a fee or commission in connection with the transaction. You agree to assume all risks associated with such foreign exchange and currency conversions. Any loss which may occur as a result of the fluctuation of exchange rates is for your account. If you or your designated representative utilize investment techniques which include investments outside the United States, you authorize the Custodian to effect any related foreign exchange transactions through Citibank or any Citigroup affiliate, and non-affiliated agents to the extent permitted by law.

	
 

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Restricted Transactions

 

In accordance with the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) and Regulation GG, certain transfers or payments through your Account may be restricted that may involve Internet gambling, as defined under the regulations.

 

Account Fees

 

Citibank’s fee for services in connection with an Account shall be as set forth in the Schedule of Fees in the sales material for the Preferred Custody Services Group delivered to you or in such other written notification provided to you from time to time. Citibank’s fee includes custody services and may include transaction fees as evidenced in the agreed upon fee schedule but does not include other costs and charges described herein.

 

The annual fee for each Account is based on the total fair market value of the assets for all the Preferred Custody Services Accounts, subject to each Account having a fair market value at least equal to the Account Minimum, as set forth in the sales materials for the Preferred Custody Services Group or in such other written notification provided to you from time to time. Citibank’s annual fee for each Account will be charged monthly in arrears and will become due on the second Friday of the following month. The amount of the monthly fee shall be calculated by multiplying the annual fee by the fair market value of the assets in the Account on the last business day of the applicable month, without adjustment for any additions to or withdrawals from the Account during the month, and then dividing this amount by twelve. The fee for the first month will be prorated, based upon the period beginning on the opening date of the Account (i.e., the date the Account is opened at Citibank and funded with the applicable Minimum Investment) and ending on the last day of that month. The fee for the last month will be similarly prorated for the number of days the Account remains open in the month. Expenses and other costs and charges are due as incurred.

 

The per transaction fee rate for Account transactions shall be set forth in the Fee Schedule included in the sales materials or in such other written notification provided to you from time to time.

 

Applicable tax reporting information will be provided to the parties you have identified. For a separate fee as described in the Schedule of Fees, we will provide you with an annual summary of income collected, classified for federal and state income tax purposes, and other pertinent information to assist with annual tax return preparation.

Other costs and charges may include, but are not limited to, (i) auction fees; (ii) certain odd-lot differentials; (iii) stock exchange fees; (iv) transfer taxes; (v) electronic fund and wire transfer fees; (vi) charges of investment managers for assets under management; (vii) fees in connection with custodial, trustee and other services rendered by a Citigroup affiliate, including fees or other charges associated with transferring assets into or out of an Account; (viii) SEC fees on securities trades; and (ix) any other charges mandated by law.

 

If you or your designated representative have one or more portfolio management strategies whose investment techniques include investments outside the United States, we may from time to time pass along to you other costs and charges that may 

include all custodial charges and other expenses charged by a subcustodian or correspondent affiliated with us to custodize non-U.S. investments in the country where the principal trading market for such investment is located and all fees and commissions in connection with any foreign exchange transactions effected through Citigroup or non-affiliated agents.

 

By  signing  the  Application,  you  authorize  Citibank  and  its designated subcustodians, if applicable, to deduct all fees and commissions and other costs and charges when due with respect to each Account from the assets held in that Account.

If you request that we keep separate accounts for principal and income, we will charge Citibank’s fee and expenses to income, unless you direct otherwise; provided, however, that should there be insufficient assets in either principal or income to satisfy the obligations allocated to such sub-account, any assets in the Account, whether allocated to principal or income, may be utilized to satisfy the outstanding obligations of the Account. If your Financial Advisor refers you to Citibank for services hereunder, you acknowledge that any delivery of securities by your Financial Advisor to Citibank will result in the imposition of custody fees as described herein.

Referral Fees

 

If your Financial Advisor refers you to Citibank for services hereunder, you acknowledge that a portion of the fees described in the “Account Fees” section above will be paid to your Financial Advisor by Citibank.

 

Revenue-Sharing Payments

 

If you choose one of the following money market mutual funds for the investment of cash balances in your account, Citibank or its affiliates shall receive a mutual fund support fee, or what has come to be known as a “revenue-sharing payment”. These revenue-sharing payments are in addition to annual service fees (referred to as “12-b 1 fees”) and any other fees and expenses disclosed in a fund’s prospectus fee table. They are also in addition to other expense reimbursement and service fees described here. The funds for which revenue-sharing payments are received are as follows: Western Asset Cash Reserves, Western Asset Tax Free Reserves, Western Asset New York Tax Free Reserves, Western Asset U.S. Treasury  Reserves,  Western  Asset  Premium  Liquid  Reserves, Western Asset Premium U.S. Treasury Reserves, Western Asset California Tax Free Reserves, Western Asset Institutional Liquid Reserves, Western Asset Institutional U.S. Treasury Reserves, Western Asset Connecticut Tax Free Reserves, Western Asset Institutional Tax Free Reserves, Western Asset Institutional Cash Reserves, Western Asset Premium Liquid Reserves Limited, and Western Asset Institutional Liquid Reserves Limited.

 

What you should know about revenue-sharing payments:

 

	 	
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These payments are not made from fund assets, but instead are paid from the assets of a fund’s investment adviser or other affiliate.

 

	 	
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Brokerage commissions that funds pay for portfolio trades are not used to offset any portion of these payments.

	
 

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The foregoing funds are charged a revenue-sharing fee, calculated quarterly, of fifty percent (50%) of the sum of (1) the pro-rata management fee with respect to the assets of clients of Citi Private Bank invested in the applicable fund, plus (2) the applicable 12b-1 fees payable from the applicable fund with respect to the assets of clients of Citi Private Bank invested in the applicable fund, payable from the fund management company by subtracting (2) from such sum and remitting the difference to Citibank or its affiliates.

Additionally, affiliates of Citibank may receive compensation from certain funds in the form of commissions and other fees for providing traditional brokerage services, including related research and advisory support, and for the purchase and sale of securities for fund portfolios. Citibank affiliates also may receive other compensation from certain funds for financial services performed for the benefit of such funds.

You may obtain prospectuses for any of the money market mutual funds listed above from your Citigroup representative or your independent investment advisor.

Grant of Lien

 

You hereby represent and warrant that any securities delivered to  Citibank  to  be  held  in  your  Account(s)  are  free  of  any encumbrances, including constructive liens. Your interest in the Account(s) and in the assets held in the Account(s) may not be sold, pledged or otherwise transferred, except for pledges of the Account(s) and the assets held therein as collateral security for obligations to Citigroup or third-party collateral which has been accepted by Citigroup.

 

In order to secure all your present and future obligations to Citibank under this Agreement (including, but not limited to fees, expenses or taxes) and all other present and future indebtedness or obligations to Citigroup that you may incur, secured by the Account(s) or the assets held therein, you hereby grant to Citibank, except where prohibited by law, a first priority continuing lien and security interest in all of your right, title and interest in the Account(s) or other personal property of yours which is in our possession, but not limited to bank deposits and securities and all assets now or hereafter held in the Account(s) and all income and other proceeds and products thereof. You agree that such liabilities or obligations may be satisfied by applying any of your personal property with us. We may apply funds in your accounts with us or sell your personal property which is not an account, by public or private sale at our discretion, and use the proceeds of such sale to satisfy such liabilities or obligations whether or not such liability or obligation is subject to a contingency.

In addition, you consent to Citigroup and any subcustodians appointed by Citibank taking all actions necessary or desirable under all applicable laws to perfect and protect such lien or to enable Citigroup to exercise and enforce its rights and remedies with respect to the Account(s) and the assets held therein. Specifically, for U.S. law purposes, you acknowledge and agree that, to the extent that the assets in the Account(s) constitute “security entitlements” for purposes of Article 8 of the Uniform Commercial Code in effect from time to time in the State of New York, Citibank shall be the “entitlement holder” of such “security

entitlement(s).” You also acknowledge and agree and hereby consent to subcustodians appointed by Citibank entering into an agreement with Citibank whereby such subcustodians of the assets (and for U.S. law purposes as “securities intermediary”) undertake to comply at all times solely with instructions or “entitlement orders,” including transfer and withdrawal orders, originated by Citibank without further consent by you.

 

Right of Offset

 

If any of you has present and future indebtedness or obligations to Citigroup, you agree that we may set off and apply funds, deposits, balances, debt, checks, assets, in any currency held for you or owed to you, by Citigroup, to satisfy or reduce your debt, without notifying you in advance. This is true whether the debt is incurred individually or jointly and whether or not your other assets are held individually or jointly. You agree that we may effect this set-off even though we have not demanded payment from you or your debt has not matured. This set-off right is in addition to our rights under applicable law and other agreements.

 

Taxes and Expenses

 

In addition to fees and other costs and charges, you agree to pay all taxes, legal and other expenses (collectively with fees and other costs and charges, “expenses”) associated with each Account arising under the laws of any relevant jurisdiction. By signing the Agreement, you authorize us to debit the relevant Account and/or any other account you may have with Citigroup for such expenses as incurred. This includes, but is not limited to, expenses we may incur protecting or enforcing our rights and obligations, as well as expenses resulting from a breach of this Agreement on your part. As required by law, we may withhold from any payments due to you from this account any taxes currently due or due from any prior distributions. If additional funds are required to cover any due taxes, you are required to promptly provide such additional funds to us. In addition, if you or an Account is subject to legal, governmental or administrative proceedings, you agree that we may charge any Account and/or any other account you may have with Citigroup for the expenses related to those proceedings.

 

Citibank and its designated sub-custodians, if applicable, as U.S. Withholding Agents (“USWA”) are required to withhold and provide applicable information reporting with respect to each Account as required by U.S. tax law. Citibank or a designated sub-custodian will withhold the applicable amounts with respect to each distribution to the extend required by U.S. tax law. Withholding requirements are determined based on the type of U.S. tax certification form provided, or in the absence of a tax form or a valid tax form, the applicable presumption rules. Any amounts withheld are remitted to the IRS and if applicable, to the appropriate state agency.

U.S. persons are required to provide Form W-9 “Request for Taxpayer Identification Number (TIN) and Certification”; U.S. persons include but are not limited to:

 

	 	
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an individual citizen or resident of the United States;

	
 

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a corporation, or other entity taxable as a corporation for U.S. federal income tax purposes, created or organized in or under the laws of the United States, any state thereof or the District of Colombia

 

	 	
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an estate whose income is subject to U.S. federal income taxation regardless of its source; or

 

	 	
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a trust if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons have the authority to control all substantial decisions of the trust, or that has a valid election in effect under applicable U.S. Treasury regulations to be treated as a United States person.

 

Non U.S. persons are required to provide the appropriate Form W-8 (W-8BEN, W-8IMY, W-8ECI or W-8EXP).

 

	 	
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Non-U.S. persons are beneficial owners or intermediaries that are not U.S. persons as described above.

 

Absent a valid U.S. tax certification form, we will apply the presumption rules and the account will be either a presumed U.S. person subject to U.S. person withholding and reporting requirements, such as 28% back-up withholding and Form 1099 information reporting or a presumed Non U.S. person, subject to 30% U.S. Withholding Tax (also known as Non Resident Tax) and Form 1042-S reporting. Under the presumption rules, actual knowledge is not relevant, unless it results in a higher rate of withholding. We are required to withhold on any reportable amounts on any Account that is a U.S. or a presumed U.S. account; this withholding is required from the day of account opening until such time as the proper, valid tax certification form is received by us. However, under current U.S. tax law, we may issue a refund of any back-up withholding applied during the period the Account was uncertified, provided a valid tax form is received within 30 days of account opening. Accounts that are presumed U.S. that are later determined to be Non U.S. persons must submit a valid tax form to us by December 15th allowing us time to make the appropriate withholding adjustments.

 

Additionally, withholding applicable to investments in Non U.S. securities or American Depository Receipts (“ADRs”) are subject to  foreign  withholding  requirements.  Withholding  on  these instruments is applied at the source and we receive the payments net of foreign withholding. Some jurisdictions require additional documentation to be provided in order to establish entitlement to a reduced or exempt rate of withholding.

 

The information contained in this Agreement is subject to change without notice due to changes in tax law, changes in third parties services, changes in local market rules, and practices or actions taken by U.S. Tax Authorities, non-U.S. agents and Foreign Tax Authorities, among others. The information contained in this Agreement is based on information available at the time of printing. Citigroup and its agents, do not warrant or guarantee the accuracy and completeness of, nor undertake to update or amend this information every time there is a change in requirements. Citigroup works with local market agents, third party providers and issuers to provide the most accurate information available at the time of distribution. Citigroup and its agents are not liable for any loss arising from or in reliance with information provided in this Agreement.

Legal Process

 

We may comply with any writ of attachment, adverse claim, execution, garnishment, tax levy, restraining order, subpoena, warrant or other legal process which we believe (correctly or otherwise) to be valid. A fee for processing will be assessed. NOTE: If we are not fully reimbursed for our record search, photocopying and handling costs by the party which served the process, we may charge such costs to any account of yours, as we determine, in addition to our minimum legal process fee. You agree to indemnify, defend and hold us harmless from all actions, claims, liabilities, losses, costs and damages (including attorney’s fees) associated with our compliance with any process that we believe to be valid. Accounts opened with trust or fiduciary designations (e.g., “XYZ Inc.-Client Trust Account”) may be subject to levies and other legal process against your property unless our records clearly reflect the existence of an express written trust or court order. We will not pay interest on any funds we hold or set aside in response to legal process. You agree that we may honor legal process which is served by mail or facsimile transmission, or at any of our offices, even if the law requires personal delivery at the office where you maintain your account.

 

Valuation

 

In computing the fair market value of any securities or other investments in an Account, securities listed on any U.S. national securities exchange shall be valued, as of the valuation date, in U.S. dollars at the closing composite price (the consolidated tape price). Any other securities or investments held in an Account shall be valued by the Custodian, based on values received from you or your designated representative, to reflect fair market value. Any such valuation should not be considered a guarantee of any kind whatsoever with respect to the value of the assets in an Account.

 

Representations and Warranties

 

You acknowledge that you are solely responsible for, and that neither  we  nor  any  other  Affiliated  Organizations  has  any responsibility for, your compliance with any laws, regulations or rules applicable to your use of the services provided by us under this Agreement including, but not limited to, any laws, regulations or rules, in your or any other jurisdiction, relating to tax, foreign exchange and capital control, and for reporting or filing requirements that may apply as a result of your country of citizenship, domicile, residence or taxpaying status.

 

You certify that copies of all trust agreements, wills, court orders and other documents or agreements that you now or hereafter provide to Citibank are in full force and effect, genuine, complete, unaltered, and have not been modified, repealed or superseded.

	
 

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General Agreements and Authorizations

 

In connection with the services being provided to you under this Agreement, you agree that we can rely on the financial and other information provided by you or your designated representative to us from time to time. You are bound by instructions given by  your  designated  representatives  and  authorized  signers; any  errors  resulting  from  misinformation  provided  by  your designated  representatives  and  authorized  signers  are  your responsibility   and   Citibank   may   accept   instructions   from designated representatives and authorized signers until your Citi Private Bank Representative is notified by signed written instruction (original, facsimile, PDF)of any changes and Citibank has had sufficient time to act upon such notices.

 

You agree to promptly inform us in writing if you change your citizenship or legal residence. You also agree to promptly inform us if you or any of the co-applicants, trustees, fiduciaries or any other authorized signers are or become a) a politician (whether elected or not) or significant government official who occupies, has occupied, or is actively seeking or being considered for a senior public position in the government or political party of a country, state or significant municipality; b) a government owned or controlled corporation, department or agency, or an executive thereof; c) a military officer; d) a close family member (e.g. spouse, parent, child, sibling, or in-law) of any of the above; or e) a close associate of any of the above. Please note that “being considered for a senior public position” includes all individuals running for public office along with their senior campaign managers. Furthermore, you agree to provide us with any information that we may reasonably request from time to time.

 

You agree to send all notices and instructions to us in writing addressed to Citibank, and to transmit them directly to Preferred Custody  Services  or  through  your  private  banker  or  other Citigroup representative who handles your Citibank accounts or to any future address we may designate. If you transmit instructions or notices to us through another Citibank branch or other Citigroup entity, you assume responsibility for any resulting risks, delays or errors. Receipt of instructions by any such office or person does not constitute receipt by us. If, in our judgment, your instructions are unclear, we may choose not to act on them until the ambiguity has been resolved to our satisfaction. We may refuse to act on any instructions that we believe are contrary to or not clearly permitted by this Agreement, applicable law or other relevant requirements. You agree that any notice or communication is considered delivered to you on the date we first place them in the mail to the address specified by you in this Agreement or the date the electronic mail is first sent. You consent to our recording any telephone conversations you may have with us.

 

You agree that you may not assign this Agreement without our prior consent. Any assignment or transfer by you of an Account that is made without our prior written approval will be void.

 

You agree that no delay in enforcing our rights under this Agreement will be construed as a waiver of our rights. Only a written waiver signed by us will be valid. You understand that the rights granted to us in this Agreement are additional to those given by law or other agreements you may have with us.

If you are a retirement plan subject to the Employee Retirement Income Security Act of 1974 (“ERISA”), by opening an Account, your signature on the Application and any other account opening documents constitutes your acknowledgement that you reviewed the Citi Private Bank Preferred Custody Services ERISA Section 408(b)(2) Disclosure Document made available to you reasonably in advance of your deciding to open your Account(s) and that after your review, you made an independent decision that the fees and other compensation are reasonable for the services being provided by Citibank. Your signature further acknowledges that you consent to Citibank updating or changing the Disclosure Document by posting updated documents and/or notices at http://citi.com/investorinfo/advisoryprivacy/408b2disclosures.html and that it is your responsibility to check the website periodically for such updates.

 

You authorize:

 

	 	
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Citibank from time to time to investigate and verify any information  contained  in  or  obtained  now  or  later  in connection with this Account, to check your credit history and obtain consumer and/or credit reports in connection with any account or service for which you now or may hereafter apply. If you ask, you will be told whether or not a consumer and/or credit report on you was requested and the name and address of the agency that furnished the report. To facilitate your application for, and when activated the maintenance of, accounts and services covered hereunder, you consent to Citibank’s exchange of your consumer and/or credit reports, this Application, any information about you, your accounts or services, and any other document delivered now or later in connection herewith with its affiliates.

 

	 	
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Your employer, your bank, and any other references supplied on or in connection with this Account now or later or which appear on your consumer or credit reports to release and/or verify information to Citibank.

 

	 	
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Citibank to share with credit bureaus, affiliates and other proper persons information about your creditworthiness and how you handle your accounts and services.

 

	 	
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Citibank, with regard to the applied for accounts and services, as an accommodation to you, to accept and act from time to time, in its sole discretion, upon instructions received by mail or messenger, or upon oral, telephonic or electronic instructions received from a person who identifies himself or herself to be you, your designated representative or your authorized signer. You understand the risk and potential for misuse that exists in giving instructions in this manner.

 

Subsequent Accounts, Credit and Services

 

You authorize Citibank to accept instructions from you to open and close accounts and to request or terminate any account service covered by this Agreement, without requiring further original signatures from you. Unless you have advised Citibank to the contrary, your delivery to Citibank of any such instructions shall be confirmation that there are no material adverse changes in the information you have given in the original Agreement.

	
 

8

Account Types

Joint Accounts with Rights of Survivorship

 

All accounts for relationships established in more than one person’s name are joint accounts with right of survivorship. Each owner of a joint account has the individual authority to: give instructions of any kind; make deposits or withdrawals; receive payments, notices or demands; borrow money and grant security interests in your joint assets for obligations of anyone; appoint one or more attorneys-in-fact for the accounts; sign any documents or agreements; and in all other ways act alone regarding your accounts, this Agreement and any related services. If we receive timely written notice from any joint account holder requesting that we not pay or deliver funds in a joint account, we may require the signature of all joint account holders for future payments or deliveries. For title changes, we may require the signature of all joint account holders. You agree that each joint account holder shall be individually and jointly responsible for any overdrafts, credit extensions, charges, fees or other debts related to joint assets, regardless of who incurred the debt or benefited from or participated in the action. We may set-off any joint account holder’s debt to an Affiliated Organization against your accounts, whether the debt was incurred individually or jointly. You agree that if a joint account owner dies, his or her rights to the account pass to the surviving joint account holders, subject to applicable taxes and our receipt of acceptable documents. All the assets in a joint account may be deemed part of the estate of the deceased joint account holder. For tax reporting purposes it is recommended that you consult your Tax Advisor.

Trust/Fiduciary Accounts

 

If this Agreement is entered into by a trustee or other fiduciary of the Accountholder, such trustee or fiduciary hereby represents and warrants that the services to be provided by Citibank to the Accountholder hereunder or hereafter are within the scope of the services and investments authorized by the governing instruments of, and/or laws and regulations applicable to, the Accountholder, and that said trustee or fiduciary has the requisite authority under the governing instrument and/or applicable law to enter into this Agreement on behalf of the Accountholder to compensate us in the manner described herein.

Custodial (Uniform Transfers to Minors Act) Accounts

 

For accounts opened under the Uniform Transfers to Minors Act (“UTMA”), you, the accountholder, are the UTMA Custodian. By opening this type of account, you agree that all assets belong to the minor and that you will use them exclusively for the minor’s benefit. Citibank accepts no responsibility to monitor distributions, payments, or applications of account assets and you agree to indemnify and hold Citibank harmless from any loss or damage related to claims that any distributions, payments, or applications of account assets were not made for the exclusive benefit of the minor.

Entity Type Accounts

 

If the Accountholder is a corporation, limited liability company, partnership or other entity type account, the signatory on behalf of the Accountholder represents that all necessary actions have been taken, and approvals received, in accordance with the Accountholder’s  charter,  governing  documents,  statutes  and applicable law to enter into and permit its obligations under this Agreement and that the Accountholder is in good standing in the jurisdiction in which it is organized. The Accountholder hereby undertakes to advise Citibank of any event that might affect the Accountholder’s authority to participate in, or the propriety of, this Agreement.

Individual Retirement Arrangement Accounts (IRA)

 

You certify that you are eligible to establish a traditional IRA, Roth IRA or SEP-IRA.

 

You also hereby acknowledge that:

 

	 	
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You have received and read the Citibank Traditional IRA or Roth IRA Agreement and Disclosure Statement (“IRA Plan Document”). You accept the terms set forth therein as supplemented by this Agreement and you appoint Citibank, N.A. to be custodian of your Citibank traditional IRA, Roth IRA or SEP-IRA.

 

	 	
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This Agreement is subject to, and will be performed in accordance with, the provisions of the applicable IRA Plan Document. This Agreement, however, will be controlling if any of its terms are inconsistent with the applicable IRA Plan Document.

 

	 	
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If you invest in a mutual fund, you agree that such mutual fund or its affiliates may compensate Citibank, its subsidiaries or affiliate services. Further information is contained in the fund’s prospectus.

 

	 	
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Any election to have a contribution treated as a Rollover cannot be revoked.

 

	 	
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The contribution is made for the tax year indicated. If a tax year is not indicated, the contribution will be treated as a current year contribution.

 

	 	
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You understand that each Citibank affiliate shares information about its transactions and experiences with you.

 

	 	
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The general rules governing your Investment Options of the Traditional IRA Plan Documents contain an arbitration provision and that your Citibank Traditional IRA, SEP-IRA or Roth IRA Account is governed by these terms.

 

	 	

Arbitration for Traditional IRA, SEP-IRA or Roth IRA Accounts:

 

You are aware that the Citibank Traditional IRA, SEP-IRA or Roth IRA Agreement and Disclosure Statement contains a Pre-Disputed Arbitration clause on page 3 thereof.  You  acknowledge  receipt  of  the  Pre-Disputed Arbitration Clause and that your Citibank Traditional IRA, SEP-IRA or Roth IRA Account is governed by these terms.

	 

	
 

9

By notifying us in writing that you have named or changed your beneficiary(ies), you cancel any earlier designation you may have made with respect to the assets in your Citibank IRA.

 

	 	
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If you do not name your spouse as beneficiary, there may be income tax implications for your estate or beneficiary.

 

	 	
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If  you  do  not  name  a  beneficiary,  the  beneficiary  will automatically be your estate.

 

	 	
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If you designate more than one primary beneficiary, the proceeds will be distributed equally among them unless you indicate otherwise.

 

	 	
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Any secondary beneficiary you name will receive proceeds only if all of your primary beneficiaries are deceased.

 

	 	
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If you designate more than one secondary beneficiary, the proceeds will be shared equally among them unless you indicate the share percentage for each.

 

Corporate Reorganization/Class Action Notices and Proxies

 

All corporate reorganization, class action and proxy materials related to securities held in an Account will be sent to you as part of your regular Account correspondence, unless you designate another  party  to  receive  these  materials.  Please  note  that corporate reorganization notices, class action notices and proxies can only be mailed to one party per account. If you have elected to have these materials mailed to a designated representative or if you have requested to have these materials mailed to you at an address other than your legal residence or principal place of business, you agree to indemnify Citibank against all loss, liability, costs, claims, damages, or expenses we may suffer resulting from complying with your request and will notify Citibank in writing of changes to this request. Additionally, you agree that us  providing  corporate  reorganization  notices,  class  action notices and proxies to your designated representative or to your mailing address is considered received by you. You understand that you or your designated representative is expected to vote proxies in such a manner as you deem to be desirable and then forward the executed proxies to the issuing company. You relieve us of liability if corporate reorganization notices, class action notices and/or proxies inadvertently do not reach you or your designated recipient. You further understand that due to the difficulty in obtaining proxies in regard to any non-U.S. (i.e., foreign) securities, we will not provide you or your designated recipient with such proxies, and you relieve us of all responsibility in connection therewith.

 

Dormant Accounts

 

Under abandoned property statutes, we must turn over to the state assets in your Account if you have not done at least one of the following during a specified period of time:

 

	 	
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A customer initiated transaction (i.e. deposit, withdrawal, trade)

 

	 	
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Signed our active account confirmation form

 

	 	
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Written to us concerning your Account

Please note that the period of inactivity for an account to be considered abandoned property differs by state. The laws of the state of your last known address determine the inactivity period and the manner in which your funds are transferred to the state.

 

Termination of Preferred Custody Services Agreement

 

Either of us can terminate this Agreement at any time upon 30 day advance written notice to the other. Any termination of this Agreement will not, however, affect the liabilities or obligations of the parties incurred, or arising from transactions initiated, under this Agreement prior to such termination, which shall survive any expiration or termination of this Agreement. In addition, we can terminate your Account if the total assets held in the Account fall below the Preferred Custody Services Account Minimum, as established by us from time to time.

 

Upon the termination of this Agreement, we shall have the right to complete any transactions open as of the termination date and to retain amounts in each Account sufficient to effect such completion. Upon notification of the termination of this Agreement, you must give us written instructions, including the name and the delivery instructions for another custodian for all the cash and assets within 30 days of such termination; provided that, if your written instructions raise any legal risks to us (such as a possible violation of applicable money-laundering laws), we may refuse to dispose of or transfer any assets held in each such Account.

 

Governing Law and Submission to Jurisdiction

 

The Booking Center for each Account shall be New York, New York, U.S.A. for accounts booked in Citibank, N.A. For accounts booked in Citibank, N.A., the principal Service Location is New York, New York. This is the location where Citibank will receive and disburse funds and maintain primary accounting records with respect to each Account. It is also the principal location of the Custodian where the administration will take place. The assets held in each Account will generally be held by Citibank in New York, unless your Account includes investments outside the United States, in which case Account assets may be held in custody in the country where the principal trading market for such investment is located. All investments held in custody are subject to the laws, regulations and usages of the place where kept.

 

An Account will be subject to supervision by the regulatory authorities  in  each  jurisdiction  where  these  services  are performed as well as in the United States.

 

You agree that this Agreement will be governed by, and construed in accordance with, the laws of the State of New York, without reference to a choice of law doctrine.

 

For any dispute related to this Agreement, you (i) irrevocably submit to the jurisdiction of the courts of New York, New York, U.S.A., provided that at our sole discretion this jurisdiction shall not be exclusive; (ii) waive any defense of inconvenient forum; (iii) agree that any final judgment will stand and be enforceable in other jurisdictions by suit or as provided by law and will be binding on you, your heirs, executors, legal representatives, successors and assigns; (iv) agree that any summons, process or other legal document in connection with any such dispute may be served on you or your personal representatives by serving it personally or by sending it by pre-paid, registered post or other substantially similar method to you at the address specified by you in this Agreement; and (v) waive any right to a jury trial in any such dispute.

 

	
 

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Citibank Obligations in Respect of an Account

 

Citibank’s obligations under this Agreement and in respect to an Account will be a general unsecured obligation of Citibank, and information with respect to the assets held in an Account will be available to you only through Citibank. You will not have access to any information regarding any Account or any assets held in an Account directly from any subcustodian that may be appointed by Citibank, nor will a subcustodian accept any instructions directly from you in respect of the assets in an Account.

 

All communications to you regarding an Account will come through Citibank, which entered into the Agreement with you, and all instructions and other communications from you regarding an Account (including requests to add to or withdraw assets from an Account, instructions to transfer or close an Account and questions or concerns you may have regarding an Account) must be made through Citibank.

 

Performance by Citibank and the Custodian of the obligations under this Agreement and with respect to an Account are subject to the laws of the jurisdiction of Citibank, which has entered into  this  Agreement  with  you (including  any  governmental acts, orders, decrees or regulations applicable to such legal vehicle). Citibank shall not be liable for the unavailability of the funds credited to an Account or otherwise payable to you due to restrictions on convertibility or transferability, requisitions, involuntary transfers, laws, acts of God, fires, war, civil strife, terrorist acts, strikes, power failures, errors/failures/malfunctions of   equipment,   hardware,   software,   telecommunications   or intermediary/recipient banks, from government restrictions or actions, exchange or market rulings or suspension of trading or  similar  events  beyond  the  control  of  Citibank,  in  which circumstances no other branch, office, subsidiary or affiliate of Citibank will be responsible therefore.

 

You  agree  that  neither  Citibank  nor  any  other  Citigroup affiliate,  nor  their  directors,  officers,  employees  or  agents will be responsible or liable for any costs, losses, damages or expenses resulting, directly or indirectly, from laws, acts of God, fires, war, civil strife, terrorist acts, strikes, power failures, errors/failures/malfunctions of equipment, hardware, software, telecommunications   or   intermediary/recipient   banks,   from government restrictions or actions, exchange or market rulings or suspension of trading or similar events beyond the control of Citibank, in which circumstances no other branch, office, subsidiary or affiliate of Citibank will be responsible therefore.

Limitation of Liability

 

Citibank’s liability to you for any loss or damage arising from or relating to this Agreement, regardless of the form of action, shall be limited to direct damages attributable to Citibank’s own gross negligence, fraud or willful misconduct. In no event shall Citibank be liable for any punitive, indirect, consequential or special damages or lost profits, even if Citibank has been advised in advance of the possibility of such damages.

 

Severability

 

If any provision of this Agreement is found to be invalid, illegal or unenforceable in any jurisdiction, the validity, legality and enforceability of the remaining provisions, or of such provision in any other jurisdiction, shall not in any way be affected or impaired. This Agreement shall be binding on you, your heirs, executors, legal representatives, successors and assigns.

 

Amendments

 

We reserve the right to change the terms and conditions contained in the Agreement, which may include adding to them or deleting certain provisions entirely or partially, without prior notice to you. Citibank will give you notice of any amendment for which your consent is required and any amendment required by law. In addition, we will revise the Agreement from time to time to reflect these changes. Copies of the current Agreement will be available from your Preferred Custody Services Representative. We suggest that you keep any notification of changes to the Agreement along with the rest of your Preferred Custody Services account information. When we notify you of any changes, we may mail or deliver a notice, a statement message, or an electronic message to you at the last address we have on file for you. The Agreement supersedes all previous agreements and understandings between you and us with respect to the subject matter hereof.

 

Electronic Delivery

Notices, Disclosures, etc.

 

From time to time, we may agree to electronic delivery of notices, disclosures and regulatory information in connection with this Agreement. Such information includes notices and disclosures covered by laws that require delivery to be “in writing,” such as Account statements and other documents you have chosen to receive, including confirmations and proxies. To the extent we agree to electronic delivery in connection with this Agreement, the following terms and conditions shall apply:

 

	 	
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Delivery may be either by secure (i.e., encrypted) or public (i.e., unencrypted) e-mail, or by posting such notices and disclosures on a web site. We will not send any notices or disclosures containing confidential information to you by public e-mail or post any such notices or disclosures on a public web site.

	
 

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E-mail will be sent to the e-mail address provided by you to us from time to time, and you hereby waive all claims resulting from failure to receive communications because of changes in your e-mail address.

 

	 	
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All notices sent to you by public e-mail shall be effective when sent to your e-mail address; all notices posted to a website shall be effective upon delivery to you of a notice (sent by public e-mail to your e-mail address) directing you to the relevant web site. If an electronic notice sent via public e-mail is returned to us undelivered, we will attempt redelivery, at our option, either by telecopier or to a postal address based on your contact information in our files; redelivered notices shall be effective upon delivery or when delivery is refused if sent to a postal address or upon receipt of confirmation of delivery by telecopier.

 

	 	
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If we post notices or disclosures on a secure web site, we will provide you with a User ID and a means of authenticating your identity (which may be a password, digital certificate, “smart card” or other identifier) (a User ID, together with any other identity authentication information, is referred to as “User Information”) so that you can access the web site. You agree to comply with all security procedures that we may require to safeguard your User Information. In addition, you agree to take all reasonable precautions to keep your User Information confidential and to prevent unauthorized use. You also agree to notify us immediately in the event of the loss or theft of your User Information or if you believe the  confidentiality  of  your  User  Information  has  been compromised in any way. We will not be responsible for any breach of security caused by your failure to maintain the confidentiality of your User Information.

 

	 	
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You  may  request  a  paper  copy,  at  no  charge,  of  any notice, disclosure or other information delivered to you electronically  at  any  time  by  contacting  your  private banker or other Citigroup representative, and you may withdraw your consent to receive notices and disclosures electronically at any time by contacting your private banker or other Citigroup representative.

 

	 	
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We will notify you from time to time of any hardware or software requirements to receive, access, retain and print notices delivered to you electronically. At a minimum, you will need a computer equipped with Windows 98 (or a higher version of Windows) and either a printer, drive or other storage device.

 

	 	
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You may be asked, from time to time, to demonstrate that you can receive disclosures and regulatory materials electronically (e.g., by responding to an electronic request for such confirmation).

 

	 	
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You acknowledge and agree that in the course of delivering notices and disclosures to you electronically, we may transfer information about you, an Account and your relationship with us crossborder. You therefore hereby release us from any duty we might otherwise have to observe the banking secrecy laws of any relevant jurisdiction.

	 	
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Citibank may, from time to time, fax you information on products and/or services that are available to clients of Citi Private Bank using any fax numbers provided in this Agreement, provided by you during the course of your relationship with Citibank and/or provided in a directory, advertisement  or  site  on  the  Internet  to  which  you voluntarily agreed to make available your fax number for public distribution.

Account Data

 

From time to time, we may agree to electronic delivery of account data  in  connection  with  this  Agreement.  Such  information includes  transferring  data  related  to  your  Account(s)  and holdings in such Account(s) to you or your designated recipient, solely as convenience to you and upon your written authorization in an electronic format (the “Data Transfer”). To the extent we agree to the Data Transfer in connection with this Agreement, the following terms and conditions shall apply:

 

	 	
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The Data Transfer will be provided by Citibank and any of its affiliates authorized to do business in the country (including state, province or other jurisdiction) where Citibank deems the Data Transfer to be accessed by you or your designated recipient. The Data Transfer is not intended to be provided to and may not be used by any party in any jurisdiction where the provision or use thereof would be contrary to applicable law, rules or regulations.

 

	 	
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You may separately designate in writing to Citibank a third party  processor (“Data  Processor”)  to  directly  receive or access the Data Transfer on your behalf. In such case, you represent and warrant that the Data Transfer is being processed by your Data Processor on your behalf pursuant to a written agreement between you and your Data Processor. You further agree that, other than transmitting the Data Transfer in accordance with this section of this Agreement, Citibank shall have no obligations with respect to your Data Processor or your Data Processor’s handling of the Data Transfer, or the data therein. You assume full responsibility to ensure that your Data Processor’s use of the Data Transfer is limited solely to the purpose for which your Data Processor is retained by you, and that your Data Processor takes all necessary steps to maintain the confidentiality of the data contained in the Data Transfer.

 

	 	
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In addition, you acknowledge and agree that you will require your  Data  Processor  to  maintain  effective  information security measures to protect the data contained in the Data Transfer from unauthorized disclosure or use. In the event of a security breach under your or your Data Processor’s control involving data contained in the Data Transfer of which you become aware, you agree to, as soon as practical, alert Citibank of the security breach and to provide reasonable assistance  to  Citibank  to  obtain  information  pertaining thereto. You agree and acknowledges that you shall be responsible for sending any security breach notices to any impacted parties (including for example, to your employees, if applicable) as a result of a security breach under your or your Data Processor’s control involving the data contained in the Data Transfer.

 

 

	
 

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Any data transfer is provided by citibank “as is”, and neither citibank nor any third party that contributes in any manner to the data transfer makes any representation or warranty whatsoever, including warranties (i) with respect to the accuracy, completeness or timeliness of the data transfer; or (ii) that the data transfer shall be uninterrupted or error free. Further, citibank and any third party that contributes in any manner to the data transfer disclaim any express or implied warranties, including implied warranties of title, non-infringement, merchantability or fitness for a particular purpose relating to the data transfer.

 

	
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To the fullest extent permitted by applicable law, in no event shall citibank or its affiliates, subsidiaries or controlling entities or as may be applicable their third party vendors, contractors or technology or content providers or their respective officers, directors, owners, agents and employees have any liability for any loss, cost, expense or damage arising from or relating to (i) the data transfer regardless of the form of action, (ii) any punitive, indirect, consequential or special damages or lost profits, even if citibank has been advised of the possibility of such damages, (iii) the acts or omissions of a third party servicer or vendor used by citibank or you, including your data processor, or any loss, cost, damage or expense incurred by any person or entity in connection therewith, or (iv) any loss, cost, expense, or damage to you, your data processor or any third party in  connection  with  the  data  transfer.  Citibank  will  not be responsible for determining the compatibility of any computer system, software or other method used by you or your data processor to receive the data transfer.

 

	
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You agree to indemnify and hold citibank harmless from and against any and all claims, loss or damage of any nature whatsoever (including but not limited to reasonable attorneys’ fees and court costs) arising directly or indirectly from the data transfer; provided, however, that you shall not  be  obligated  to  indemnify  citibank  for  claims,  loss or damage attributable to citibank’s gross negligence or willful misconduct in connection with the data transfer. This indemnity will survive the termination of this agreement.

 

	
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You acknowledge that any Data Transfer once initiated shall remain in place until you have provided written notice to Citibank to the contrary and Citibank shall have had a reasonable time to act upon such notice in order to ensure proper termination of the Data Transfer.

Other Activities of Citibank and Citigroup Affiliates

 

By reason of the commercial and investment banking or other activities of Citibank and other Citigroup affiliates, we may from time to time acquire confidential information and information about corporations or other entities and their securities. We will not divulge such information to you, nor will we act upon such information with respect to our activities or the activities of such corporations or other entities, including with respect to this Agreement.

You  acknowledge  that  Citibank,  the  Custodian  and  other Citigroup affiliates may perform, among other things, investment banking, research, brokerage, investment advisory and custodial services for other clients. You also acknowledge and agree that Citibank and the Custodian may take action in the performance of their duties to such clients (including clients who may also have Accounts similar to those available hereunder or hereafter) which may differ from actions taken, or in the timing and nature of actions taken, with respect to you and an Account. Nothing in this Agreement shall be deemed to impose on Citibank, the Custodian or other Citigroup affiliates any obligation to recommend any investment advisor or to purchase or sell, or recommend for purchase or sale, for you or for an Account, any securities or other investments which Citibank or other Citigroup affiliates  may  recommend,  purchase  or  sell,  or  recommend for purchase or sale, for its own account or for the account of any other client. Furthermore, nothing in this Agreement shall be deemed to impose upon Citibank, the Custodian or other Citigroup affiliates any obligation to give you the same actions as may be given to any other clients. Citibank, the Custodian and other Citigroup affiliates may compensate affiliated companies and/or their representatives for providing services to you.

 

In addition, Citibank may receive fees for services with respect to assets invested in investment funds.

 

	
 

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Investment Risks

 

General

 

Investment products (securities, fund shares and other non-depository investments) purchased or held in this Account are not insured by the Federal Deposit Insurance Corporation or any other governmental agency, are not a deposit or other obligation of Citibank or any other Citigroup affiliate and are not guaranteed by Citibank or any other Citigroup affiliate and are subject to investment risks, including the possible loss of the principal amount invested. The following paragraphs describe some of the major risks associated with investments purchased or held in the Preferred Custody Services Account.

 

Investing in securities and other financial instruments involves risks that may affect the value of the securities held in an Account and result in losses to you, including the potential loss of the principal amount invested. Potential risks include, among others, losses caused by adverse market conditions, market volatility, limited liquidity and other market action. You agree that we will not be responsible for losses in value in an Account, or for acting or failing to act with respect to an Account, so long as we act in good faith.

If a portfolio includes investments denominated in currencies other than your reference currency, you understand and acknowledge that such investments involve added risks, including losses caused by fluctuations in foreign exchange rates, devaluation of non-reference currencies or actions by a government or any other party which make it difficult or impossible to convert a non-reference currency to your reference currency or to return funds to Citibank.

 

The following is a general description of some of the major risks associated with cash and short-term investments.

Cash and Short-Term Investments

 

If you choose the Citibank Market Deposit Account (“MDA”) or a non-interest-bearing United States Dollar (“USD”) deposit (“NIBD”) as the vehicle in which to invest your cash and short-term investments, you should be aware of the limitations of FDIC insurance. The MDA and the NIBD are FDIC insured deposit accounts of Citibank, N.A. and are insured by the FDIC up to the maximum allowable by the FDIC. Any other deposits, including checking accounts, savings accounts or certificates of deposit (“CDs”) you maintain with Citibank, N.A. in the same capacity, directly or through an intermediary such as a brokerage account, will be aggregated with your MDA and/or NIBD balances for purposes of determining the applicable FDIC insurance limit. This insurance limit is in addition to the $250,000 FDIC insurance limit on eligible retirement accounts. For FDIC insurance purposes, retirement accounts are defined as traditional IRAs (Individual Retirement Accounts), Roth IRAs, self-directed Keogh accounts, “457  Plan”  accounts  for  state  government  employees,  and

employer sponsored “defined contribution plan” accounts that are self-directed, which are primarily 401(k) accounts. In general, self-directed means that the consumer chooses how and where the money is deposited. If Citibank, N.A. fails, the aggregated deposit accounts you maintain are insured, up to the applicable limits, for principal and interest accrued to the day Citibank, N.A. is closed. 

 

It is your responsibility to monitor the total amount of deposits that you maintain with Citibank, N.A. and to determine the extent of FDIC insurance coverage available to you. We shall have no responsibility to monitor your deposits.

Investments in a money market mutual fund is NOT FDIC insured. A money market mutual fund seeks income by investing in short-term debt securities. Although a money market mutual fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money with respect to an investment in a money market mutual fund, or the fund could underperform other short-term debt instruments or money market mutual funds if:

 

	 	
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Interest rates rise sharply.

 

	 	
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An issuer or guarantor of the fund’s securities defaults or the security’s credit rating is downgraded.

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