Form 10-Q CITIGROUP INC For: Mar 31
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E-mail____ PSU FORM OF AWARD AGREEMENT Exhibit 10.01
Citigroup Inc.
Performance Share Unit Award Agreement
Summary
Citigroup Inc. (“Citigroup”) hereby grants to {NAME} (the “Participant”) the performance share unit award summarized below pursuant to the terms of the Discretionary Incentive and Retention Award Plan, as amended and restated effective January 1, 2015 (“DIRAP”). The terms, conditions and restrictions of your award are contained in this Award Agreement, including the attached Terms and Conditions (together, the “Agreement”).
For the award to be effective, you must accept below acknowledging that you have received and read this Agreement, including the Appendix. If you do not formally accept the terms and conditions of your award within the time period prescribed by Citigroup, the award summarized below will be withdrawn and cancelled.
Summary of Participant’s Performance Share Unit Award (the “Award”)
| Award Date | [Date] | ||||
Target Award (the “Target Award”) | [Number] Performance Share Units (“PSUs”) | ||||
Vesting Dates (and percentage vesting), (each, a “Vesting Date”) | [Vesting Schedule] 1 | ||||
Acceptance and Agreement by Participant. I hereby accept the Award described above, and agree to be bound by the terms, conditions and restrictions of such award as set forth in this Agreement (which includes the attached Terms and Conditions), acknowledging hereby that I have read and that I understand such document, and Citigroup’s policies, as in effect from time to time, relating to the administration of Citigroup’s incentive compensation programs.
CITIGROUP INC. PARTICIPANT'S ACCEPTANCE:
By: ________________________ __________________________
[Name] Name:
[Title] GEID:
_______________________________
•Unless specified herein, the vesting schedule and the other terms omitted from this Award Agreement will be disclosed in Citigroup’s annual proxy statement reporting on compensation for the year for which the Award was granted.
CITIGROUP INC.
PERFORMANCE SHARE UNIT AWARD AGREEMENT
TERMS AND CONDITIONS
The Terms and Conditions below constitute part of this Agreement and relate to the Award described on the Award Summary. Except as otherwise provided herein, the “Company” means Citigroup and its consolidated subsidiaries. The “Committee” means the Personnel and Compensation Committee of the Citigroup Board of Directors or any person acting with authority delegated from such Committee.
1. Participant Acknowledgements. By accepting the Award, Participant acknowledges that:
(a)Participant has read and understands these Terms and Conditions. Participant acknowledges that the official language of these documents is English.
(b)Participant understands that the Award and all other incentive awards are entirely discretionary. Participant acknowledges that, absent a prior written agreement to the contrary, he has no right to receive the Award, or any incentive award, that receipt of the Award or any other incentive award is neither an indication nor a guarantee that an incentive award of any type or amount will be made in the future, and that the Company is free to change its practices and policies regarding incentive awards at any time in its discretion.
(c)Because the Award is intended to promote employee retention, among other interests, the Award will be cancelled if performance and vesting conditions set forth herein are not satisfied or if a clawback provision is applied. The Award is a forward-looking award that delivers value only to the extent that performance goals and conditions are attained and specified service conditions are satisfied.
(d)Any actual, anticipated, or estimated financial benefit to Participant from the Award (or any other incentive award) is not and will not be deemed to be a normal or an integral part of Participant’s regular or expected salary or compensation from employment for any purpose. Participant hereby agrees that neither the Award nor any amounts payable in respect of the Award will be considered when calculating any statutory, common law or other employment-related payment to Participant, including any severance, resignation, termination, redundancy, end-of-service, bonus, long-service awards, pension, superannuation or retirement or welfare or similar payments, benefits or entitlements.
(e)The value that may be realized from the Award, if any, is contingent and depends on the future market price of Citigroup stock, among other factors. Any monetary value assigned to the Award in any communication is contingent, hypothetical, and for illustrative purposes only and does not express or imply any promise or intent by the Company to deliver, directly or indirectly, any certain or determinable cash value to Participant.
(f)The Award is an unsecured general obligation of Citigroup and, until paid in accordance with its terms, is subject to the claims of Citigroup’s creditors. The currency in which Participant’s Award is denominated and/or paid and any required tax withholding and reporting will be in accordance with Citigroup’s policies, as in effect from time to time, relating to the administration of Citigroup’s incentive compensation programs (including Citigroup’s policies with respect to this Award).
(g)The Award does not confer any shareholder rights of any kind. The Award is not an equity security of Citigroup, and as such, Participant has no shareholder rights derived from the Award. The Award does not confer any voting rights or rights to dividends at any time, and all value attributable to the Award including the amount equal to cash dividends referenced herein is compensation.
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| 2. | Performance Share Units. | ||||
(a) General. The value of each PSU corresponds to one share of Citigroup common stock; however, PSUs are deliverable only in cash. The portion, if any, of Participant’s Target Award that will be earned is based on the Company’s performance against the performance measures set forth in this Section 2, the Award’s vesting conditions, and the other terms and conditions of this Agreement.
(b) Performance Metrics and Schedule.
(i) Performance Schedule. Participant’s Award will be earned based on Citigroup’s performance against the Average RoTCE metric and the Cumulative TBVPS metric for the Performance Period in accordance with the performance schedule below. The metrics will be equally weighted; Citigroup’s performance against each metric will determine fifty percent (50%) of Participant’s Award.2
| Metric: Citigroup Average RoTCE over the Performance Period | Percentage of Target PSUs Earned | Metric: Cumulative TBVPS | Percent of Target PSUs Earned | ||||||||
| Less than ___% | ___% | Less than $___ | ___% | ||||||||
| At least ___% and less than ___% | Interpolation from ___% to ___% dependent on Relative Average RoTCE Performance | At least $___ and less than $___ | Interpolation from ___% (at $___ cumulative TBVPS) to ___% (at $___ cumulative TBVPS) | ||||||||
| At least ___% and less than ___% | Greater of (1) interpolation from ___% (at ___% RoTCE) to ___% (at ___% RoTCE) and (2) percentage based on Relative Average RoTCE Performance | At least $___ and less than $___ | ___% | ||||||||
| ___% or more | ___% | At least $___ and less than $___ | Interpolation from ___% (at $___ cumulative TBVPS) to ___% (at $___ cumulative TBVPS) | ||||||||
| $____ or more | ___% | ||||||||||
(ii) Interpolation.
(1)For the Average RoTCE metric, if Average RoTCE is between the ___% and ___% targets, the number of PSUs earned by Participant in respect of the Average RoTCE
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metric will be determined by straight-line interpolation between ___% and ___% targets.
(2)For the Cumulative TBVPS metric, if Cumulative TBVPS is between $_____ and $_____, or between $_____ and $_____ the number of PSUs earned by Participant in respect of the Cumulative TBVPS metric will be determined by straight-line interpolation between the applicable two points.
(3)For Relative Average RoTCE Performance, if Citigroup’s Relative Average RoTCE Performance is between the thresholds in the table Section 2(b)(iv) below, the number of PSUs earned by Participant based on the Average RoTCE metric will be determined by straight-line interpolation.
(iii) Defined Terms. For purposes of this Agreement:
“Cumulative TBVPS” means the sum of the “tangible book value per share” as of the last day of each fiscal year in the Performance Period, as reported in Citigroup’s Annual Report on Form 10-K; provided, however, that the determination of Cumulative TBVPS may be equitably adjusted in accordance with Section 9.
“Average RoTCE” means the average of Citigroup’s or a member of the Comparison Group’s, as applicable, RoTCE for each fiscal year in the Performance Period, as reported in Citigroup’s or a member of the Comparison Group’s Annual Report on Form 10-K or as otherwise publicly reported; provided, however, that the determination of Average RoTCE may be equitably adjusted in accordance with Section 9.
“Average RoTCE” means the average of Citigroup’s or a member of the Comparison Group’s, as applicable, RoTCE for each fiscal year in the Performance Period, as reported in Citigroup’s or a member of the Comparison Group’s Annual Report on Form 10-K or as otherwise publicly reported; provided, however, that the determination of Average RoTCE may be equitably adjusted in accordance with Section 9.
“RoTCE” means net income, less preferred dividends, divided by average tangible common equity.
“Performance Period” means ___________, 20__ through ____________, 20__.
“Relative Average RoTCE Performance” means the ranking of Citigroup’s Average RoTCE compared to the rank of the Average RoTCE of the members of the Comparison Group determined in accordance with Section 2(b)(iv).
“Comparison Group” means the companies listed below:
Bank of America Corporation
Barclays PLC
Credit Suisse
Deutsche Bank AG
The Goldman Sachs Group, Inc.
HSBC Holdings plc
JPMorgan Chase & Co.
Morgan Stanley Inc.
UBS A.G.
Wells Fargo & Company
(iv) Relative Average RoTCE Performance. After the end of the Performance Period, the Committee will rank each member of the Comparison Group according to Average RoTCE, and Citigroup’s Average RoTCE relative to the Average RoTCE of members of the Comparison
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Group will determine the percentage of PSUs earned under the Average RoTCE metric, as follows:
| Relative Average RoTCE Performance of Citigroup | PSUs Earned Based on Relative Average RoTCE Performance | ||||
| 0 Percentile | % | ||||
25th Percentile | % | ||||
50th Percentile | % | ||||
75th or higher Percentile | % | ||||
After the end of the Performance Period, the Committee will rank each member of the Comparison Group according to Average RoTCE as follows:
| Comparison Group Average RoTCE Rank | Percentile Rank | ||||
| 1 | 100.00% | ||||
| 2 | 88.89% | ||||
| 3 | 77.78% | ||||
| 4 | 66.67% | ||||
| 5 | 55.56% | ||||
| 6 | 44.44% | ||||
| 7 | 33.33% | ||||
| 8 | 22.22% | ||||
| 9 | 11.11% | ||||
| 10 | 0.00% | ||||
Citigroup’s Average RoTCE will then be compared to Average RoTCE of the Comparison Group. If Citigroup’s Average RoTCE is (1) equal to the Average ROTCE of a member of the Comparison Group, then Citigroup’s percentile rank will be deemed to be equal to the percentile rank of that member, (2) between the Average ROTCE of two members of the Comparison Group, then Citigroup’s percentile rank will be based on the linear interpolation between the percentile rank of those members and (3) greater than Average ROTCE of the highest ranking Comparison Group member or less than the Average ROTCE of the lowest ranking Comparison Group member, then Citigroup’s percentile rank will be deemed to be 100.00% or 0.00%, respectively.
If, during the Performance Period, one or more companies in the Comparison Group merges, engages in a spin-off or otherwise experiences a material change in its business activities or it or one of its primary businesses shall terminate or cease due to receivership, bankruptcy, sale, or otherwise, then the Committee may eliminate such company from the Comparison Group or make other adjustments to the Comparison Group, such as adding an acquirer or a new company to the Comparison Group, to the extent necessary to prevent the enlargement or diminution of the rights of Participants, with any such changes having effect for purposes of all calculations hereunder. In any of these events, the approach to determining percentiles may also be equitably adjusted by the Committee.
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(c) Cap on Awards for Negative TSR during the Performance Period. Notwithstanding any provision of this Agreement to the contrary, if the Committee determines that Citigroup’s TSR, calculated in accordance with Section 2(c)(i) below, for the Performance Period is negative, the number of PSUs earned by Participant will not exceed the number of PSUs in Participant’s Target Award shown on the Award Summary.
(i) For purposes of Section 2(c), “TSR” for Citigroup will be expressed as a percentage determined by dividing: (A) (1) the average of the closing prices on the New York Stock Exchange (“NYSE”) on the twenty (20) trading days ending on the last day in the Performance Period of shares of Citigroup common stock plus (2) the amount of the “Adjusted Value of Reinvested Dividends of Citigroup common stock” (as defined below), minus (3) the average of the closing prices on the NYSE on the twenty (20) trading days immediately preceding the first day of the Performance Period, by (B) the average of the closing prices on the NYSE on the twenty (20) trading days immediately preceding the first day of the Performance Period. The percentage will be equitably adjusted to account for changes in capital structure or other events as provided in Section 9.
(ii) For purposes of Section 2(c)(i), “Adjusted Value of Reinvested Dividends of Citigroup common stock” means the product of A and B divided by C, where “A” is equal to the sum of all dividends paid on a share of Citigroup common stock during the Performance Period assuming dividend reinvestment through the last trading day of the Performance Period, “B” is the average of the closing prices on the NYSE on the twenty (20) trading days ending on the last day in the Performance Period, and “C” is the closing price of a share of Citigroup common stock on the NYSE on the last trading day of the Performance Period.
(d) Conversion of Vested Earned PSUs to Cash. After the end of the Performance Period, the Committee will determine the percentage of the Target Award PSUs that have been earned by the Participant during the Performance Period pursuant to Section 2(b). The Committee will then multiply the percentage determined pursuant to the performance schedule in Section 2(b) by the allocable number of Target Award PSUs (the “Earned Award”), to derive a number of PSUs constituting the Earned Award. After Participant’s final Vesting Date as set forth in the Award Summary, the Committee will then determine the extent to which Participant has vested in his or her Earned Award, determined after applying the provisions of Section 3 and Section 4 hereof. On or as promptly administratively practicable after ___________, 20__2 (the “Award Payment Date”), Participant will receive a cash payment equal to (i) the number of PSUs in Participant’s vested Earned Award multiplied by the average of the closing prices of Citigroup common stock on the NYSE for the twenty (20) trading days immediately preceding Participant’s final Vesting Date, plus (ii) (A) the number of PSUs in Participant’s vested Earned Award multiplied by (B) an amount equal to the sum of all cash dividends (regular and special) declared on a share of Citigroup common stock after ___________, 20__3 and on or before the Award Payment Date.
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_____________________________
2 Insert a date following the end of the Performance Period and before March 15 of the year following the end of the Performance Period.
3 Insert the day immediately preceding the first day of the Performance Period.
(e) Committee Authority. The Committee has exclusive and binding authority to make all determinations relating to the determination of Average RoTCE, RoTCE, Cumulative TBVPS, TSR and the other provisions of the Agreement, to interpret the Agreement, to make all legal and factual determinations relating to the Award, and to determine all questions arising in the administration of the Award and the Agreement, including, without limitation, the reconciliation of any inconsistent provisions, the resolution of ambiguities, the correction of any defects, and the supplying of omissions. Each interpretation, determination or other action made or taken by the Committee will be final and binding on all persons. To the extent permitted by applicable law, the Committee may delegate to one or more employees of the Company some or all of its authority over the administration of the Award. Such delegation need not be in writing.
(f) Award Suspension. Notwithstanding anything in this Agreement to the contrary, the Committee will suspend the vesting and/or payment of an Award pending an investigation into whether there are circumstances that would prevent an Award from vesting under the general vesting conditions or subject the Award to forfeiture pursuant to the General or Citi Clawbacks. Notwithstanding anything in this Section 2 to the contrary, if it is subsequently determined (whether following an investigation or otherwise) that vesting conditions are, in fact, not satisfied with respect to any outstanding Award, the Award may be reduced or cancelled. If it is subsequently determined (whether following an investigation or otherwise) that vesting conditions were, in fact, not satisfied with respect to an Award that should not have been paid or vested, Participant will be obligated, pursuant to Section 6 of this Agreement, to return or repay to the Company any improperly vested amounts.
3. Termination of Employment and Other Changes in Status. If Participant’s employment with the Company terminates or is interrupted before the final Vesting Date set forth in the Award Summary, or if Participant’s status changes under the circumstances described below, Participant’s rights with respect to the Award will be affected as provided in this Section 3. Participant’s vested status determines the percentage of the Earned Award he is eligible to receive after the end of the Performance Period. In all cases, a vested Award will be delivered only after the end of the Performance Period, after the Committee determines Participant’s Earned Award. If Participant’s employment with the Company terminates for any reason not described below, the Award will be cancelled.
(a) Voluntary Resignation. If Participant voluntarily terminates his or her employment with the Company and at such time does not satisfy the conditions of Section 3(j) or (k) below, vesting of the Award will cease on the date Participant’s employment is so terminated; the unvested portion of the Award will be cancelled and Participant will retain his or her rights in the portion of the Award that has vested as of Participant’s termination date subject to all other provisions of this Agreement. For purposes of this Agreement, a termination of
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employment by Participant that is claimed to be a “constructive discharge” (or similar claim) will be treated as a voluntary termination of employment, unless otherwise required by law.
(b) Disability. The Award will continue to vest on schedule subject to all other provisions of this Agreement, including, without limitation, the Citi Clawback, the General Clawback, and the Performance Vesting Condition in Section 4(a), during Participant’s approved disability leave pursuant to a Company disability policy. If Participant’s approved disability leave ends with a termination of Participant’s employment by the Company because Participant can no longer perform the essential elements of his or her job, the unvested portion of the Award will continue to vest on schedule subject to all other provisions of this Agreement, including, without limitation, the Citi Clawback, the General Clawback, and the Performance Vesting Condition in Section 4(a).
(c) Approved Personal Leave of Absence (Non-Statutory Leave).
(i) The Award will continue to vest on schedule subject to all other provisions of this Agreement, including, without limitation, the Citi Clawback, the General Clawback, and the Performance Vesting Condition in Section 4(a), during the first six months of Participant’s personal leave of absence that was approved by the Company in accordance with the leave of absence policies applicable to Participant (an “approved personal leave of absence”). The unvested portion of the Award will be cancelled as soon as the approved personal leave of absence has exceeded six months, except as provided in paragraph (ii) below.
(ii) If Participant’s employment terminates for any reason during the first six months of an approved personal leave of absence, the Award will be treated as described in the applicable provision of this Section 3. If Participant satisfies the conditions of Section 3(k) before the approved personal leave of absence exceeds six months, the unvested portion of the Award will continue to vest on schedule subject to Section 3(k), as applicable.
(d) Statutory Leave of Absence. The unvested portion of the Award will continue to vest on schedule subject to all other provisions of this Agreement, including, without limitation, the Citi Clawback, the General Clawback, and the Performance Vesting Condition in Section 4(a), during a leave of absence that is approved by the Company, is provided by applicable law and is taken in accordance with such law and applicable Company policy (a “statutory leave of absence”). If Participant’s employment terminates for any reason during a statutory leave of absence, the Award will be treated as described in the applicable provision of this Section 3. If Participant satisfies the conditions of Section 3(k) during a statutory leave of absence, the unvested portion of the Award will continue to vest on schedule, subject to Section 3(k).
(e) Death. If Participant’s employment terminates by reason of Participant’s death or if Participant dies following a termination of his or her employment during the Performance Period while he is continuing to vest in his or her Award, the unvested portion of the Award will continue to vest on schedule subject to all other provisions of this Agreement, and the Award will be paid to Participant’s estate after the Earned Award has been determined in 20__4; provided, however, that if the performance vesting condition or clawback provisions described in Section 4 have been triggered by circumstances existing at any time prior to the time the Award becomes an Earned Award, Participant’s Award will be reduced or cancelled accordingly.
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_____________________________
4 Insert either the year in which the Performance Period ends or the next year after the end of the Performance Period, depending on when the Earned Award will be determined.
(f) Involuntary Termination for Gross Misconduct. If the Company terminates Participant’s employment because of Participant’s “gross misconduct” (as defined below) ), or if the Committee determines following termination of Participant’s employment that the Participant’s employment could have been terminated for gross misconduct, the Award, including any vested portion of the Award, will be cancelled as of the date Participant’s employment is terminated and Participant will have no further rights of any kind with respect to the Award. For purposes of this Agreement, “gross misconduct” means (1) competition by the Participant during employment by the Company with the Company’s business operations, or (2) “gross misconduct” by the Participant under guidelines established by the Company in respect of the administration of Awards, as in effect from time to time, which shall be deemed to include any circumstance in which Participant: (i) is subject to an action taken by a regulatory body or a self-regulatory organization (“SRO”) as a result of his or her act or omission which substantially impairs him or her from performing his or her Company duties; (ii) is materially dishonest in connection with his or her employment by the Company; (iii) breaches his or her fiduciary duty of loyalty to the Company, including but not limited to a breach of an agreement to not solicit Company employees or customers or a breach of an agreement relating to confidential information or intellectual property, regardless of whether that breach occurs during or after employment with the Company; (iv) materially breaches the terms of any offer letter, separation agreement, or other agreement with the Company or breaches the Company’s Code of Conduct, or materially breaches any other material Company policy (including but not limited to material compliance, control or employment policies); (v) violates any securities or banking law, rule or regulation or the constitution, by-laws, rules or regulations of a regulatory authority or SRO while employed by the Company; (vi) fails to remain licensed to perform his or her Company duties; or (vii) is convicted of a felony or a crime of breach of trust, money laundering or dishonesty, or participates in a pre-trial diversion program after being charged or indicted for a felony or such crime, in each case of clauses (i) through (vii) above as determined by the Committee, in its discretion.
(g) Involuntary Termination Other than for Gross Misconduct. If Participant’s employment is terminated by the Company involuntarily other than for gross misconduct, including under a reduction in force or job discontinuance program, the unvested portion of the Award will continue to vest on schedule subject to all other provisions of this Agreement, including, without limitation, the Citi Clawback, the General Clawback, and the Performance Vesting Condition in Section 4(a).
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(h) Transfer to Non-Participating Subsidiary. If Participant transfers to a subsidiary that is a member of the “controlled group” of Citigroup (as defined below), any unvested portion of the Award will continue to vest on schedule subject to all other provisions of this Agreement, including, without limitation, the Citi Clawback, the General Clawback, and the Performance Vesting Condition in Section 4(a). If Participant transfers to a subsidiary that is not a member of the “controlled group” of Citigroup (as defined below), the provisions of Section 3(g) will apply to the Award. For purposes of this Agreement, “controlled group” has the meaning set forth in Treas. Reg. § 1.409A-1(h)(3).
(i) Employing Company is Acquired by Another Entity (Change in Control). If Participant is employed by a company or other legal entity other than Citigroup where Citigroup ceases to own, directly or indirectly, at least 50% of the voting power or value of the equity of the employing entity, the unvested portion of the Award will continue to vest on schedule subject to all other provisions of this Agreement, including, without limitation, the Citi Clawback, the General Clawback, and the Performance Vesting Condition in Section 4(a). A change in control of Citigroup Inc., as defined in the 2019 Stock Incentive Plan, in any successor stock incentive plan, or otherwise, will not cause the Award to vest or otherwise affect the vesting of the Award.
(j) Voluntary Resignation to Pursue Alternative Career. If Participant has not met the conditions of Section 3(k), and Participant voluntarily resigns from his or her employment with the Company to work in a full-time paid career (i) in government service, (ii) for a bona fide charitable institution, or (iii) as a teacher at a bona fide educational institution, and/or otherwise satisfies the alternative or additional requirements (including written management approvals) that may be imposed by then applicable guidelines adopted for the purposes of administering this provision (an “alternative career”), any unvested portion of the Award will continue to vest on schedule subject to all other provisions of this Agreement, including, without limitation, the Citi Clawback, the General Clawback, and the Performance Vesting Condition in Section 4(a), and the applicable guidelines (or until such earlier date on which Section 3(e) applies); provided that in the event of resignations described in Sections 3(j)(ii) and (iii), Participant remains continuously employed in the alternative career (or a new alternative career) until each scheduled Vesting Date and Participant provides by each subsequent Vesting Date, if requested by the Company, a written certification of compliance with the Company’s alternative career guidelines, in a form satisfactory to the Company. If an acceptable certification is not provided by the relevant Vesting Date, any unvested portion of the Award will be cancelled.
(k) Satisfying the “Rule of 60.” If Participant (i) is at least age 50 and has completed at least five full years of service with the Company and Participant’s age plus the number of full years of service with the Company equals at least 60, or (ii) Participant is under age 50, but has completed at least 20 full years of service with the Company and Participant’s age plus the number of full years of service with the Company equals at least 60 (the “Rule of 60”), the unvested portion of the Award will continue to vest on schedule subject to all other provisions of this Agreement, including, without limitation, the Citi Clawback, the General Clawback, and the Performance Vesting Condition in Section 4(a), provided that if Participant has voluntarily terminated his or her employment, Participant is not, at any time up to and including each scheduled Vesting Date (or until such earlier date on which Section 3(e) applies), employed, directly or indirectly, by a Significant Competitor of the Company (as defined in Section 3(l) below). Participant’s age and years of service will each be rounded down to the nearest whole number when determining whether the Rule of 60 has been attained.
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(l) Definition of “Significant Competitor;” Certification of Compliance.
(i) For purposes of this Agreement, a “Significant Competitor” of the Company means any company or other entity designated by the Committee as such and included on a list of Significant Competitors that will be made available to Participant and which may be updated by the Company from time to time in its discretion. Employment by a Significant Competitor includes service on a board of directors or similar governing body of any Significant Competitor (including subsidiaries or affiliates) that is also listed in the full “Compensation Peer Group” in Citigroup’s most recent annual Proxy Statement. For purposes of this Section 3(l), “Company” means Citigroup and any of its subsidiaries.
(ii) Whenever the Award continues to vest pursuant to Section 3(k) following a termination of employment, the vesting of the Award will be conditioned upon Participant’s providing by each subsequent Vesting Date, if requested by the Company, a written certification that Participant has complied with the terms and conditions of Sections 3(k) and 3(l)(i) in a form satisfactory to the Company. The list of Significant Competitors in effect at the time Participant terminates employment with the Company and the companies listed in the full “Compensation Peer Group” in Citigroup’s most recent annual Proxy Statement at the time Participant terminates employment with the Company will apply to such certification. If an acceptable certification is not provided by the relevant Vesting Date, vesting of the Award will cease as of the date that is immediately prior to the Vesting Date, the unvested portion of the Award will be cancelled, and Participant will have no further rights of any kind with respect to such Award.
(m) Suspension of Employment. If the Company suspends Participant’s employment (with or without pay) during an investigation, then all vesting of an Award will likewise be suspended pending the outcome of the investigation. If Participant’s employment terminates for any reason during or after such investigation, then the termination of employment will, for purposes of an Award and vesting related thereto, be effective as of the date of the suspension.
4. Other Vesting Conditions and Clawbacks. In addition to the time-based vesting schedule set forth in the Award Summary, the Award is subject to the additional vesting and clawback conditions set forth below, which may result in the reduction or cancellation of the Award prior to the time the Award becomes an Earned Award. The performance vesting and clawback conditions described in this Section 4 do not change during the performance period of the Award, regardless of Participant’s status as an active or terminated employee or other change in employment status.
(a)Performance Vesting Condition. The Committee may cancel all or a portion of the Award (including a Vested Award) prior to the time it becomes an Earned Award if it determines, in its discretion, that Participant has had significant responsibility, whether of a supervisory or direct nature for a material adverse outcome, whether financial reputational or otherwise for Citigroup or any of its businesses or functions. The Committee will have the exclusive discretionary authority to determine and define “significant responsibility” and “material adverse outcome.”
(b)General Clawback. Participant’s Award is subject to the following clawback condition (the “General Clawback”). The Committee may cancel all or a portion of the Award prior to the time the Award becomes an Earned Award if it determines, in its discretion, that (1)
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Participant engaged in behavior (i) constituting misconduct; (ii) constituting the exercise of materially imprudent judgment that caused harm to any of the Company’s business operations; or (iii) that resulted or could result in regulatory sanctions (whether or not formalized) to the Company and/or the Participant; or (2) Participant failed to properly supervise or monitor individuals engaging in, or to properly escalate, in accordance with the Company’s policies, behavior (i) constituting misconduct; (ii) constituting the exercise of materially imprudent judgment that caused harm to any of the Company’s business operations; or (iii) that resulted or could result in regulatory sanctions (whether or not formalized) to the Company and/or the Participant.
(c)Citi Clawback. The Committee will cancel all or a portion of the Award prior to the time the Award becomes an Earned Award if it determines, in its discretion, that Participant (i) received the Award based on materially inaccurate publicly reported financial statements; (ii) knowingly provided materially inaccurate information relating to publicly reported financial statements; (iii) materially violated any risk limits established or revised by senior management and/or risk management; or (iv) Participant engaged in “gross misconduct” as defined Section 3(f) hereof, it being understood that such definition shall be applied regardless of whether the Company knows of such conduct, or the facts giving rise thereto, prior to the termination of Participant’s employment with the Company or whether Participant’s termination of employment relates to such conduct or facts (the “Citi Clawback”).
(d)Additional Conditions. Vesting and payment of an Award are subject to receipt of the information necessary to make required tax payments and confirmation by Citigroup that all applicable conditions to vesting and payment have been satisfied. All payments pursuant to the Award will be net of any amounts withheld for taxes.
5. Transferability.
(a) Transfers by Participant. The Award may not be sold, pledged, hypothecated, assigned, margined or otherwise transferred, other than by will or the laws of descent and distribution, and neither the Award nor any interest or right therein will be subject to the debts, contracts or engagements of Participant or his or her successors in interest or will be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law, by judgment, lien, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy or divorce), and any attempted disposition thereof will be null and void, of no effect, and not binding on the Company in any way. Participant agrees that any purported transfer will be null and void, and will constitute a breach of this Agreement causing damage to the Company for which the remedy will be cancellation of the Award. During Participant’s lifetime, all rights with respect to the Award will be exercisable only by Participant, and any and all payments in respect of the Award will be to Participant only. The Company will be under no obligation to entertain, investigate, respect, preserve, protect or enforce any actual or purported rights or interests asserted by any creditor of Participant or any other third party in the Award, and Participant agrees to take all reasonable measures to protect the Company against any such claims being asserted in respect of Participant’s Award and to reimburse the Company for any and all reasonable expenses it incurs defending against or complying with any such third-party claims if Participant could have reasonably acted to prevent such claims from being asserted against the Company.
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(b) Transfers by the Company. Citigroup may assign the legal obligation to pay Participant’s vested Earned Award to Participant’s employer without the consent of Participant.
6. Repayment Obligations and Right of Set-Off.
(a) Repayment Obligations. If the Committee determines that all conditions to vesting and payment of the Award (or any portion thereof) were not satisfied in full, the Committee will cancel such vesting and immediately terminate Participant’s rights with respect to such Award (or improperly vested portion thereof). If any such Award (or improperly vested portion thereof) has already been paid, Participant agrees, upon demand, to pay the Company the amount of any cash paid in settlement of the vesting of such Award (or improperly vested portion thereof), without reduction for any amounts withheld to satisfy withholding tax or other obligations due at the time such payment that is subsequently determined to have been improperly made.
(b) Right of Set-Off. Participant agrees that the Company may, to the extent determined by the Company to be permitted by applicable law and consistent with the requirements of Section 409A of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), retain for itself funds otherwise payable to Participant pursuant to the Award or any award under any award program administered by Citigroup to offset (i) any amounts paid by the Company to a third party pursuant to any award, judgment, or settlement of a complaint, arbitration, or lawsuit of which Participant was the subject; or (ii) any outstanding amounts (including, without limitation, travel and entertainment or advance account balances, loans, repayment obligations under any award agreement such as those imposed by a clawback provision, or any obligations pursuant to a tax-equalization or housing allowance policy or other expatriate benefit) that Participant owes the Company or its affiliates. The Company may not retain such funds and set-off such obligations or liabilities, as described above, until such time as they would otherwise be payable to Participant in accordance with the Award terms. Only after-tax amounts will be applied to set-off Participant’s obligations and liabilities and Participant will remain liable to pay any amounts that are not thereby satisfied in full.
7. Consent to Electronic Delivery. In lieu of receiving documents in paper format, Participant hereby agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that Citigroup may be required to deliver (including, but not limited to, brochures, grant or award notifications and agreements, account statements, and all other forms or communications) in connection with the Award and any other prior or future incentive award or program made or offered by Citigroup or its predecessors or successors. Electronic delivery of a document to Participant may be via a secure internet site to which Participant has access.
8. Administration. The Award described in this Agreement has been granted subject to the terms of the DIRAP. The Committee and its delegates have the exclusive discretionary authority to make findings of fact, conclusions, and determinations regarding the interpretation of the Agreement or the administration of the Award, and will have the exclusive and final authority to determine all calculations of all Award amounts. The Committee has exclusive authority to establish administrative procedures to implement the terms of the Award, including but not limited to procedures applicable to currency exchange rates, the delivery of the Award in the currency of Participant’s work country or countries, and the administration of the timing of Award delivery. Any such procedure so established will be conclusive and binding on Participant.
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9. Adjustments to Awards.
(a) Capital Structure. In the event of any change in the capitalization of Citigroup on account of (i) an extraordinary dividend, stock dividend, stock split, reverse stock split or similar equity restructuring; or (ii) a combination or exchange of equity securities, merger, consolidation, recapitalization, reorganization, divestiture, acquisition or distribution (other than ordinary cash dividends) of assets to stockholders, or other similar event affecting the capitalization of Citigroup, to the extent necessary to prevent the enlargement or diminution of the rights of Participant, the Committee will make appropriate equitable adjustments to the Award (including the determination of Average RoTCE, RoTCE, and Cumulative TBVPS ), which adjustments will not require the consent of Participant.
(b) Equitable Adjustments. If an event, or series of similar or related events, occurs with respect to the Company that renders, in the determination of the Committee, either or both of the performance measures set forth in Section 2(b) to no longer be appropriate, then the Committee will make appropriate equitable adjustments to the Award (including the determination of Average RoTCE, RoTCE and Cumulative TBVPS) to the extent necessary to prevent the enlargement or diminution of the rights of Participant. In the event of an unusual or non-recurring event affecting Average RoTCE, RoTCE, or Cumulative TBVPS or a change in applicable tax laws or accounting principles, the Committee will make appropriate equitable adjustments to the Award (including the determination of Average RoTCE, RoTCE and Cumulative TBVPS), to the extent necessary to prevent the enlargement or diminution of the rights of Participant, which adjustments will not require the consent of Participant.
(c) Modifications. The Committee retains the right to modify the Award if required to comply with applicable law, regulation, or regulatory guidance (including applicable tax law) without the consent of Participant. Citigroup will furnish or make available to Participant a written notice of any modification through a brochure supplement or otherwise, which notice will specify the effective date of such modification. Any other adverse modification not elsewhere described in this Agreement will not be effective without Participant’s written consent.
(d) Adverse Consequences. Neither the Committee nor Citigroup will be liable to Participant for any additional personal tax or other adverse consequences of any adjustments that are made to the Award.
10. Taxes and Tax Residency Status.
(a) Compliance. By accepting the Award, Participant agrees to pay all applicable taxes and to file all required tax returns in all jurisdictions where Participant is subject to tax and/or an income tax filing requirement. To assist Citigroup in achieving full compliance with its obligations under the laws of all relevant taxing jurisdictions, Participant agrees to keep complete and accurate records of his or her income tax residency status and the number and location of workdays outside his or her country of income tax residency from the date of the Award until the vesting of the Award. Participant also agrees to provide, upon request, complete and accurate information about his or her tax residency status to Citigroup during such periods, and confirmation of his or her status as a (i) U.S. citizen, (ii) holder of a U.S. green card, or (iii) citizen or legal resident of a country other than the U.S. Participant will be responsible for any tax due, including penalties and interest, arising from any misstatement by Participant regarding
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such information. The Award will be subject to cancellation if Participant fails to make any such required tax payment.
(b) Withholding. To the extent the Company is required to withhold tax in any jurisdiction or withholds hypothetical tax under a Citigroup Expatriate Policy, the Company will withhold from the vested portion of the Award to the extent permitted by applicable law and Participant will be paid the net after-tax amount.
(c) Executive Performance Plan. Any Award to a participant in the Amended and Restated 2011 Citigroup Executive Performance Plan, as further amended, effective January 1, 2021 (the “EPP”), will be granted subject to the terms of the EPP.
11. Entire Agreement; No Right to Employment. The DIRAP plan document and this Agreement constitute the entire understanding between the Company and Participant regarding the Award and supersede all previous written, oral, or implied understandings between the parties hereto about the subject matter hereof, including any written or electronic agreement, election form or other communication to, from or between Participant and the Company. Nothing contained herein or in any incentive plan or program documents will confer upon Participant any rights to continued employment or employment in any particular position, at any specific rate of compensation, or for any particular period of time.
12. Compliance with Regulatory Requirements. The Award is subject to the applicable law (including tax laws) and regulatory guidance in multiple jurisdictions, and will be administered and interpreted consistently with such law and regulatory guidance, including but not limited to Section 409A and Section 457A of the Code.
13. Section 409A and Section 457A Compliance.
(a) Tax Liability. Participant understands that as a result of Section 409A and/or Section 457A of the Code, if Participant is a U.S. taxpayer he could be subject to adverse tax consequences if the Award and program documents are not administered in accordance with the requirements of Section 409A or Section 457A. Participant further understands that if Participant is a U.S. taxpayer, and the Award is considered to be a “nonqualified deferred compensation plan” and Participant’s employer is considered to be a “nonqualified entity” (as such terms are defined in Section 409A and/or Section 457A of the Code), Participant could be subject to accelerated income recognition or other adverse tax consequences with respect to all or a portion of the Award if Citigroup fails to modify the Award. However, Participant acknowledges that there is no guarantee that the Award, or any amendment or modification thereto, will successfully avoid unintended tax consequences to Participant and that the Company does not accept any liability therefor.
(b) Specified Employees. This Agreement may not be amended, nor may the Award be administered, to provide for any payment of the Award to occur upon any event that would constitute a “separation from service” (within the meaning of Section 409A of the Code) if Participant is a “specified employee” (within the meaning of Treas. Reg. § 1.409A-1(i)(1)) at the time of such Participant’s “separation from service,” unless it is provided that the distribution or payment will not be made until the date which is six months from such “separation from service,” or, if earlier, the date of Participant’s death and that during such six-month deferral period,
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Participant will not be entitled to interest, or any compensation for any loss in market value or otherwise which occurs with respect to the Award during such deferral period.
14. Arbitration; Conflict; Governing Law; Severability.
(a) Arbitration. Any disputes related to the Award will be resolved by arbitration in accordance with the Company’s arbitration policies. In the absence of an effective arbitration policy, Participant understands and agrees that any dispute related to the Award will be submitted to arbitration in accordance with the rules of the American Arbitration Association. To the maximum extent permitted by law, and except where expressly prohibited by law, arbitration on an individual basis will be the exclusive remedy for any claims that might otherwise be brought on a class, representative or collective basis. Accordingly, Participant may not participate as a class or collective action representative, or as a member of any class, representative or collective action, and will not be entitled to a recovery in a class, representative or collective action in any forum. Any disputes concerning the validity of this class, representative or collective action waiver will be decided by a court of competent jurisdiction, not by an arbitrator.
(b) Conflict. In the event of a conflict between this Agreement and the DIRAP plan document, the DIRAP plan document will control.
(c) Governing Law. This Agreement will be governed by the laws of the State of New York (regardless of conflict of laws principles) as to all matters, including, but not limited to, the construction, application, validity and administration of the Company’s incentive award programs.
(d) Severability. The terms of this Agreement will be deemed severable so that if any of its provisions will be held void, unlawful, or unenforceable under any applicable statute or other controlling law, the remainder of this Agreement will continue in full force and effect, and will be construed and enforced in accordance with the purposes of the DIRAP and the Award as if the illegal or invalid provision did not exist.
15. Disclosure Regarding Use of Personal Information and Participant’s Consent.
(a) Definition and Use of “Personal Information.” In connection with the grant of the Award, and any other award under other incentive award programs, and the implementation and administration of any such program, including, without limitation, Participant’s actual participation, or consideration by the Company for potential future participation, in any program at any time, it is or may become necessary for the Company to collect, transfer, use, and hold certain personal information regarding Participant in and/or outside of Participant’s country of employment.
The “personal information” that Citigroup may collect, process, store and transfer for the purposes outlined above may include Participant’s name, nationality, citizenship, tax or other residency status, work authorization, date of birth, age, government/tax identification number, passport number, brokerage account information, GEID or other internal identifying information, home address, work address, job and location history, compensation and incentive award information and history, business unit, employing entity, and Participant’s beneficiaries and contact information. Participant may obtain more details regarding the access and use of his or
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her personal information, and may correct or update such information, by contacting his or her human resources representative or local equity coordinator.
Use, transfer, storage and processing of personal information, electronically or otherwise, may be in connection with the Company’s internal administration of its incentive award programs, or in connection with tax or other governmental and regulatory compliance activities directly or indirectly related to an incentive award program. For such purposes only, personal information may be used by third parties retained by the Company to assist with the administration and compliance activities of its incentive award programs, and may be transferred by the company that employs (or any company that has employed) Participant from Participant’s country of employment to other Citigroup entities and third parties located in the U.S. and in other countries. Specifically, those parties that may have access to Participant’s information for the purposes described herein include, but are not limited to: (i) human resources personnel responsible for administering the award programs, including local and regional equity award coordinators, and global coordinators located in the U.S.; (ii) Participant’s U.S. broker and equity account administrator and trade facilitator; (iii) Participant’s U.S., regional and local employing entity and business unit management, including Participant’s supervisor and his or her superiors; (iv) the Committee or its designee, which is responsible for administering the DIRAP and the Award; (v) Citigroup’s technology systems support team (but only to the extent necessary to maintain the proper operation of electronic information systems that support the incentive award programs); and (vi) internal and external legal, tax and accounting advisors (but only to the extent necessary for them to advise the Company on compliance and other issues affecting the incentive award programs in their respective fields of expertise). At all times, Company personnel and third parties will be obligated to maintain the confidentiality of Participant’s personal information except to the extent the Company is required to provide such information to governmental agencies or other parties. Such action will always be undertaken only in accordance with applicable law.
(b) Participant’s Consent. BY ACCEPTING THE AWARD, PARTICIPANT EXPLICITLY CONSENTS (I) TO THE USE OF PARTICIPANT’S PERSONAL INFORMATION FOR THE PURPOSE OF BEING CONSIDERED FOR PARTICIPATION IN FUTURE EQUITY, DEFERRED CASH OR OTHER AWARD PROGRAMS (TO THE EXTENT HE/SHE IS ELIGIBLE UNDER THE TERMS OF SUCH PLAN OR PROGRAM, AND WITHOUT ANY GUARANTEE THAT ANY AWARD WILL BE MADE); AND (II) TO THE USE, TRANSFER, PROCESSING AND STORAGE, ELECTRONICALLY OR OTHERWISE, OF HIS/HER PERSONAL INFORMATION, AS SUCH USE HAS OCCURRED TO DATE, AND AS SUCH USE MAY OCCUR IN THE FUTURE, IN CONNECTION WITH THIS OR ANY OTHER EQUITY OR OTHER AWARD, AS DESCRIBED ABOVE.
***
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| 2011 Citigroup Executive Performance Plan | ||
| (as amended and restated as of January 1, 2016) | ||
1. Purpose
The purpose of the 2011 Citigroup Executive Performance Plan (the ”Plan“) of Citigroup Inc. (the ”Company“) is to promote the interests of stockholders by (a) incentivizing officers and other key executives to contribute to the Company’s long-term profitability, thereby aligning the executives’ interests with those of the Company’s stockholders and other stakeholders; (b) motivating officers and key executives by means of performance-related incentives that are appropriately balanced to avoid incentives for executives to take unnecessary and excessive risks; and (c) attracting and retaining officers and key executives of outstanding ability by providing competitive incentive compensation opportunities. The Plan commenced on January 1, 2011 and was approved by stockholders of the Company on April 21, 2011 and April 26, 2016. The Tax Cuts and Jobs Act of 2017 (the “TCJA”) revised the Internal Revenue Code of 1986, as amended (the “Code”) to eliminate the exception from the deductibility limitations of Section 162(m) thereof for “qualified performance-based compensation (as in effect prior to the enactment of the TCJA, the “QPBC Exception”), including its shareholder approval requirement.
2. Administration
The Plan shall be administered by the Personnel and Compensation Committee of the Board of Directors of the Company or its delegate (the ”Committee“). The Committee may delegate its authority and responsibilities under the Plan. Subject to the express provisions of the Plan, the Committee shall have authority to: (a) select the employees who will participate in the Plan (the ”Participants“); (b) determine the amounts of the awards (”Awards“) to be made under the Plan, as described in Section 4; and (c) establish from time to time regulations for the administration of the Plan, interpret the Plan, and make all determinations deemed necessary or advisable for the administration of the Plan, which interpretations and determinations shall be final, binding and conclusive on all persons.
3. Participation
Participants in the Plan shall be selected for each calendar year (each such year a ”Plan Year“) from those executive employees of the Company (a) who are, or are expected to be, (i) ”covered employees“ as defined in Section 162(m) of the Code, or (ii) executive officers subject to the reporting requirements of Section 16(a) of the Securities Exchange Act of 1934, as amended, or (b) who are otherwise selected by the Committee to participate in the Plan. No employee shall at any time have a right to be selected as a Participant in the Plan for any Plan Year, or to be entitled automatically to an Award, or, having been selected as a Participant for one Plan Year, to be a Participant in any other Plan Year.
4. Awards, Performance Goals and Performance Periods
Section 4.01. Awards. Awards may be earned by Participants for a specified performance period (a ”Performance Period“) determined in accordance with Section 4.03; provided, however, that (a) the making of any Award under the Plan shall be contingent upon the achievement of the relevant performance goals established by the Committee (”Performance Goals“) for such Performance Period; and (b) no Award may exceed the amount established by the Committee for the actual level of performance attained.
Section 4.02. Performance Goals
| (a) | Performance Goals. Within 90 days after the commencement of a Performance Period or, if earlier, before 25 percent of such Performance Period elapses, the Committee shall establish for such Performance Period the Performance Goals and the amounts of Awards that may be earned by each Participant upon the level of achievement of the applicable Performance Goal, which may be expressed as percentages of an incentive pool or other measure prescribed by the Committee. Performance Goals may be based upon one or more of the following objective performance measures | |||||||
| (the ”Performance Criteria“) and expressed in either, or a combination of, absolute or relative values or a percentage of: revenue, revenue or product growth, net income (pre-tax or after-tax), profits (pre-tax or after-tax), earnings, earnings before or after deduction for all or any portion of interest or taxes or depreciation/amortization, earnings per share, stockholders’ equity or return on stockholders’ equity, assets or return on assets, return on risk-adjusted assets, capital or return on capital, return on risk capital, book value or book value per share, economic value-added models or equivalent metrics, operating income, income (pre-tax or after-tax), expenses or reengineering savings, margins, cash flow or cash flow per share, stock price, total shareholder return, market share, debt reduction, or regulatory achievements. Performance Goals based on such Performance Criteria may be based on the performance of the Company, any of its affiliates, any branch, department, business unit or other portion of the Company or any of its affiliates under such measure for the Performance Period and/or upon a comparison of such performance with the performance of a peer group of companies, prior Performance Periods or other measures selected or defined by the Committee at the time of establishment of such Performance Goals. For the avoidance of doubt, any Performance Criteria that are financial metrics may or may not be determined in accordance with United States Generally Accepted Accounting Principles. The outcome with respect to a Performance Goal must be substantially uncertain at the time the Performance Goal is established. | ||||||||
| (b) | Calculation. When the Committee establishes Performance Goals, the Committee shall also specify the manner in which the level of achievement of such Performance Goals shall be calculated and, if applicable, the relevant weighting assigned to such Performance Goal. In measuring the achievement of a Performance Goal, the Committee may include or exclude unrealized investment gains and losses, extraordinary, unusual, infrequently occurring or non-recurring items, asset write-downs, the effects of accounting, tax or legal changes, currency fluctuations, mergers and acquisitions, litigation or claim judgments or settlements, business interruption events, unbudgeted capital expenditures, and reserve-strengthening and other non-operating items. To the extent appropriate, the Performance Goals shall also reflect adjustments for risk balancing features. | |||||||
Section 4.03. Performance Periods. Unless otherwise determined by the Committee, each Performance Period shall commence on the first day of a Plan Year and end on the last day of such Plan Year. The Committee may establish longer Performance Periods, including multi-year Performance Periods, and the Committee may also establish shorter Performance Periods for individuals who are hired or become eligible to participate in the Plan after the commencement of a Performance Period.
Section 4.04. Discretion. The Committee shall have no discretion to increase the amount of any Award that would otherwise be payable to a Participant upon attainment of the Performance Goals applicable to a Performance Period, but the Committee may in its discretion reduce the amount or cancel such Award; provided, however, that the exercise of such negative discretion shall not be permitted to result in any increase in the amount of any Award payable to any other Participant.
Section 4.05. Determination of Award. The amount of a Participant’s Award for a Plan Year, if any, shall be determined by the Committee or its delegate in accordance with the level of achievement of the applicable Performance Goals and the other terms of the Plan. Prior to the making of any Awards hereunder, the Committee shall determine and certify in writing the extent to which the Performance Goals and other material terms of the Plan were satisfied.
Section 4.06. Maximum Award. Notwithstanding any other provision of the Plan, the maximum amount payable to a Participant under the Plan for any Plan Year shall be 0.2% of the amount of income from continuing operations before income taxes of Citigroup Inc. as reported for such Plan Year in the Quarterly Financial Data Supplement reporting the results of operations for the last fiscal quarter of such Plan Year (the ”Participant Limit“). In the case of an Award for a multi-year Performance Period, the Participant Limit will be measured by allocating the Award to each Plan Year (or portion thereof) within the Performance Period based upon the Performance Goals properly
allocated to each Plan Year. The amount payable with respect to an Award for any Plan Year shall be measured for such Plan Year, regardless of the fact that the Award may be delivered in a later year.
5. Termination of Employment
Unless otherwise determined by the Committee in accordance with the requirements of Section 162(m) of the Code, if a Participant’s employment or service with the Company and all of its subsidiaries and affiliates terminates for any reason prior to the date the Committee certifies in accordance with Section 4.05 that the Performance Goals and other material terms of the Plan were satisfied for a Performance Period, the Participant’s Award, and all rights of the Participant to such Award for such Performance Period, will be cancelled.
6. Making of Awards to Participants
Section 6.01. Making of Awards. Unless the Committee determines otherwise, an Award for a Performance Period shall be granted to a Participant during the two and one-half month period following the end of the year in which the Performance Period ends.
Section 6.02. Form of Award. Awards shall be made in any form permitted (a) under the Citi Discretionary Incentive and Retention Plan, as amended and restated effective January 1, 2015, or any successor or future similar plans, or (b) any long-term incentive award plan adopted by the Company. Subject to the terms of the Plan, the Committee shall have full discretion to determine the form, terms and conditions of any Award, which may include without limitation performance vesting conditions and clawback provisions.
Section 6.03. Tax Withholding. All Awards shall be subject to tax withholding to the extent required by applicable law.
7. Citi Clawback and Other Clawbacks
An Award will be cancelled or forfeited or subject to recovery by the Company if the Committee, in its sole discretion, determines that (a) Participant received the Award based on materially inaccurate publicly reported financial statements, (b) Participant knowingly engaged in providing materially inaccurate information relating to publicly reported financial statements, (c) Participant materially violated any risk limits established or revised by senior management and/or risk management, or (d) Participant has engaged in ”gross misconduct“ as defined herein (the ”Citi Clawback“). For purposes of this Plan, ”gross misconduct“ means any conduct that is determined by the Committee, in its sole discretion, (a) to be in competition during employment by the Company with the Company’s business operations, (b) to be in breach of any obligation that Participant owes to the Company or Participant’s duty of loyalty to the Company, (c) to be materially injurious to the Company, or (d) to otherwise constitute gross misconduct under the Company’s guidelines. Notwithstanding the foregoing, the Committee may in its discretion impose other forfeiture or recovery conditions on any Award paid in accordance with the terms of the Plan.
8. No Assignments and Transfers
A Participant shall not assign, encumber or transfer his or her rights and interests under the Plan and any attempt to do so shall render those rights and interests null and void.
9. No Rights to Awards or Employment
No employee of the Company or any of its affiliates or any other person shall have any claim or right to be granted an Award under the Plan. Neither the Plan nor any action taken hereunder shall be construed as giving any employee any right to be retained in the employ of the Company or its affiliates.
10. Amendment or Termination
The Committee may amend, suspend or terminate the Plan or any portion thereof at any time, provided that any such action complies with the requirements of Section 162(m) of the Code.
11. Section 162(m)
The Company intends that the Plan and Awards granted under the Plan to ”covered employees“ within the meaning of Section 162(m) of the Code will satisfy the applicable requirements of the QPBC Exception. Any provision of the Plan, and any interpretation or determination under the Plan by the Committee, which is inconsistent with this intent, shall be disregarded. Without limiting the foregoing, all limitations in the Plan and Awards granted under the Plan shall be interpreted and applied in a manner consistent with the QPBC Exception.
12. Effective Date and Term
The Plan was amended and restated as of January 1, 2021. The Plan became effective on January 1, 2011, and subject to Section 10 (regarding the Committee’s right to amend, suspend or terminate the Plan), shall remain in effect thereafter.
13. Governing Law; Arbitration
The Plan shall be subject to and construed in accordance with the laws of the State of New York, without regard to any conflicts or choice of law rule or principle that might otherwise refer the interpretation of the Award to the substantive law of another jurisdiction. All disputes under the Plan shall be subject to final and binding arbitration in accordance with the Company’s arbitration policy.
Exhibit 10.03
March 12, 2021
Wei-Chung Hu
New York, New York
Dear Brad:
This Separation Agreement (together with any Exhibits referenced herein, the “Agreement”) sets forth the total payments and benefits that you are eligible to receive in connection with your separation of employment from Citibank, N.A. (together, as applicable, with its parent, subsidiaries and affiliates, and as further defined herein, “Citi”) provided that you sign this Agreement, do not revoke it during the Revocation Period (as defined in Paragraph 17 below), and materially comply with its terms.
1.Termination Date, Separation Pay, and Other Payments and Benefits.
(a)From the date of this Agreement through December 31, 2020 (“Transition Period”), you will continue to receive regular salary payments at your current annual base salary rate (less applicable taxes, withholdings, and deductions) and previously elected benefits. Salary payments will be made on the regular payroll dates established by Citi during this period. During the Transition Period, you agree to facilitate the transition of your regular responsibilities and be available for consultation as needed. As of close of business on the last day of the Transition Period, you will be relieved of all job responsibilities, and your signing authority will end, as will your service as an officer, director or member of Citigroup Inc., its subsidiaries, affiliates, successors, assigns, and all other company-related entities, boards or committees. If requested, you will tender appropriate letter(s) of resignation.
(b)From January 1, 2021 through March 16, 2021 (“Notice Period”), you will continue to receive regular salary continuation payments at your current annual base salary rate (less applicable taxes, withholdings, and deductions) and previously elected benefits. Salary payments will be made on the regular payroll dates established by Citi during this period. The Notice Period and Transition Period satisfy any notice obligations you are owed under Citi policy or applicable law.
(c)Except as otherwise provided below, your employment will terminate at the close of business on March 16, 2021 (“Termination Date”).
(d)You will receive a lump sum payment in the amount of $230,769.23 (less applicable taxes, withholdings, and deductions), representing 24 weeks’ pay at your current annual base salary rate (the “Separation Pay”). This payment will be made in accordance with Paragraph 14 below.
Wei-Chung Hu March 12, 2021
a.If you sign this Agreement and Exhibit A and you do not revoke the Agreement during the applicable Revocation Period (as defined below), and subject to the terms and conditions of this Agreement, you will receive a discretionary incentive and retention award (“DIRA”) for performance year 2020 with a pre-tax nominal value of $5,420,997.57. Assuming satisfaction of the preceding sentence, 40% of the DIRA will be paid in the form of a cash bonus (the “Initial Payment”), and the remaining 60% of the DIRA will be awarded in the form of a deferred cash award pursuant to Citi’s Deferred Cash Award Plan (“DCAP”) (the award, the “DCAP Award”). The DCAP Award will vest in four equal annual installments of
$813,149.636 on each January 20 of 2022, 2023, 2024, and 2025, as set forth in and subject to the terms and conditions of the DCAP award agreement. The grant of your DCAP Award is subject to your execution of the applicable award agreement, which is attached as Exhibit A to this Agreement. The DIRA will be delivered in accordance with Paragraph 14 below.
b.You will receive payment (less applicable taxes, withholdings, and deductions) for any unused planned time off that you earned through your Termination Date pursuant to applicable policy. This payment will be made as soon as administratively practical following your Termination Date.
c.Any outstanding award made to you pursuant to a discretionary incentive and retention plan or program, including Performance Share Units (“PSU”s), a stock award or stock option grant made to you pursuant to Citi’s Capital Accumulation Plan (“CAP”), a deferred cash award made to you pursuant to DCAP, and, if applicable, your participation interest in any limited partnership or other employee investment plan, shall be treated in accordance with the terms and conditions of the applicable program or plan and the applicable award or other documentation relating thereto applicable to an Involuntary Termination Other than for Gross Misconduct, subject to the performance-based vesting conditions, clawback provisions, and other terms and conditions of the underlying award. Please consult the relevant prospectus, prospectus supplement, brochure, or other plan or award documents for the controlling terms. You may also contact Edith Ginsberg at 212- 559-2957, or ConnectOne at (800) 881-3938 and select option 5, or you may call the Citi Equity Compensation Customer Service Department at (718) 248-4510 or (877) 711-2433. If you participate in a limited partnership or other employee investment plan, you may call (212) 783-1230 or (866) 448-0639 and select option 2.
As defined above and for purposes of this Paragraph 1(g), your Termination Date shall be the last day of your Notice Period. Please note that to the extent you have any stock option awards, those awards have expiration dates that may vary based on the date of the award.
Your awards that continue to vest following your Termination Date may become subject to income or payroll taxes in one or more jurisdictions after your Termination Date. You acknowledge that you are solely responsible for paying any tax amounts due as a condition to receiving distributions or payments of your
Wei-Chung Hu March 12, 2021
outstanding stock or deferred cash awards. If any payroll taxes become due prior to the distribution or payment of any portion of your outstanding awards, you will receive an invoice from Citi for the amount of the taxes you owe in respect of such awards. If this amount is not paid in full by the due date specified in the invoice, all or a portion of your outstanding awards may be canceled.
a.If you are currently enrolled in the Citigroup Health Benefit Plan, the Citigroup Dental Benefit Plan, and/or the Citigroup Vision Benefit Plan, you may elect, under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), to temporarily continue your benefits beginning the day after your Termination Date. You will receive notification from Citi’s COBRA Administrator further advising you of the continuation of benefits available and the rates and premium payment procedure. If eligible, you may elect to enroll in retiree medical and dental coverage (“Retiree Insurance”) under the Citigroup Medical and Dental Plans. Your eligibility, the date on which you must first commence Retiree Insurance, your cost and the other terms and conditions of Retiree Insurance will be determined in accordance with the plan document and applicable policies as administered and interpreted by the Retiree Insurance administrators.
b.Through your Termination Date, you must continue to comply with all stock ownership commitments (“SOC”) and all personal trading policies that applied to you during your employment. Further, for the one year period following the date you cease to be a Section 16 officer, you will be required to retain a number of Citi shares equal to 50% of the shares previously subject to the SOC. The personal trading restrictions imposed by Citi’s personal trading policies apply to all personal trading accounts (“Personal Accounts”) held by you as well as the personal accounts of immediate family members if they are subject to those polices (“Related Accounts”). Failure to abide by the applicable trading restrictions for both Personal Accounts and Related Accounts may result in trade cancellation with all associated costs being borne by the account holders. To pre-clear transactions or if you have questions regarding personal trading, please contact the Employee Trading Hotline at (866) 369-2074.
c.During your Notice Period, there may be regulatory responsibilities on your behalf; therefore, please keep us informed of any event that would require a regulatory filing.
d.You are reminded that you are Covered Employee under Citi’s Employment Termination Notice and Nonsolicitation Policy. Therefore, except as otherwise provided by law, you may not commence employment with a new employer during the Transition Period or the Notice Period, and are subject to nonsolicitation obligations as set forth below. Further, during the Transition and Notice Periods, you must not conduct yourself in a manner that damages Citi’s existing and ongoing relationships with its clients, suppliers, and employees, or Citi’s other business interests.
1.Eligibility and Sufficiency.
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a.Subject to the terms and conditions of this Agreement: (i) you must materially comply with all applicable written, material policies in order to be eligible for the payments and benefits set forth in Paragraph 1 above; and (ii) you agree that if Citi discovers that you have engaged in any conduct which meets the criteria for cancellation of an award under the clawback provisions set forth in Sections 2(a)(i), 2(a)(ii) or 2(b) of the attached Exhibit A, Citi may immediately terminate your employment (Termination Date), cease any and all payments and benefits provided for in this Agreement, and seek other available remedies, whether at law or in equity; provided, however, that the treatment of any outstanding CAP award, DCAP award, and your participation interest in any limited partnership or other employee investment plan shall in all cases and at all times be treated pursuant to the terms of the applicable program(s) and plan(s) and amendments thereto. Citi agrees that prior to taking any action outlined in this Paragraph 2(a), Citi shall provide you with written notice describing in reasonable detail the circumstance giving rise to such alleged breach (which notice shall be delivered to you within thirty (30) days of such circumstances) and you shall have thirty (30) days from receiving such notice to cure such circumstances, to the extent such circumstances are reasonably susceptible to cure.
b.You acknowledge and agree that the total payments and benefits set forth in Paragraphs 1(a), (b), (d) and (e) of this Agreement (the “Separation Benefits”) (i) exceed the payments and benefits you would otherwise be entitled to receive under the terms of any contract or your offer letter, and (ii) constitute valuable consideration for your obligations under this Agreement.
1.Release of Claims.
a.In exchange for the Separation Benefits, you, on behalf of yourself, your agents, representatives, assignees, heirs, executors, and administrators, each in their capacity as such (collectively referred to as “Releasors”), release Citibank, N.A., its predecessors, successors and assigns, and its and their current and former direct and indirect parents, affiliates, subsidiaries, divisions, related business entities, and any and all plan administrators, plan administration committees and plan representatives of all employee benefit plans (individually and collectively, “Citi”), its and their current and former officers, directors, shareholders, employees, agents, and representatives, each in their capacity as such (individually and collectively, “Releasees”) from any and all controversies, claims, demands, promises, actions, suits, grievances, proceedings, complaints, charges, liabilities, damages, debts, allowances, bonus, stock, stock options, costs, expenses, attorneys’ fees, and remedies of any type (“Claims”) which may be waived under applicable law that Releasors may have against Releasees by reason of any matter, cause, act, or omission, including, without limitation, those arising out of or in connection with your employment with and separation from Citi, up to the date you sign this Agreement (individually and collectively, “Released Claims”). This release applies to Claims that Releasors know about and those Releasors may not know about arising at any time up to the date you sign this Agreement.
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a.Released Claims include, but are not limited to, all Claims against the Releasees under Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act of 1967, the Rehabilitation Act of 1973, the Civil Rights Acts of 1866 and 1991, the Americans with Disabilities Act of 1990, the Employee Retirement Income Security Act of 1974, the Equal Pay Act of 1963, the Family and Medical Leave Act of 1993, the Older Workers Benefit Protection Act of 1990, the Occupational Safety and Health Act of 1970, the Worker Adjustment and Retraining Notification Act, the New York State Human Rights Law, the New York City Human Rights Law, the New York Equal Pay Law, New York Labor Law §740, and the New York State Worker Adjustment and Retraining Notification Act, as well as any other foreign, federal, state, or local statute, regulation, or common law regarding employment, employment discrimination, termination of employment, retaliation, equal opportunity or wage and hour. You specifically understand that you are releasing Claims based on age, race, color, sex, sexual orientation, gender identity or expression, marital status, religion, national origin, citizenship, military or veteran’s status, disability, genetic characteristic, and all other legally protected categories.
b.Released Claims also include all Claims against the Releasees for breach of contract, any tortious act or other civil wrong, attorneys’ fees, and all compensation and benefit Claims including, without limitation, Claims concerning salary, bonus, and any awards, grants, or purchases under any discretionary incentive and retention compensation plan or program, including without limitation CAP or DCAP, and separation pay under the Citi Separation Pay Plan and any other separation pay plan maintained by Citi.
c.Except as provided in Paragraph 11 herein, you hereby waive and release your right to, and agree not to accept, any monetary or other personal recovery from Citi or any of the Releasees on account of or as a remedy for your actual or alleged injury or damages, as a result of or in connection with any Released Claim in any forum, including federal, state, or local court or in arbitration, any administrative proceeding with any federal, state, or local administrative agency, or Citi’s dispute resolution procedure.
d.In addition, and for the avoidance of doubt, Released Claims include Claims arising at any time up to the date you sign this Agreement that have or could have been filed against Citi or the Releasees under any applicable dispute resolution procedure including any arbitration policy.
e.Notwithstanding anything herein, you expressly reserve and do not waive or release your rights under this Agreement, (ii) your rights to or in any individual account(s) in which you have personally invested funds or, if applicable, under the provisions of the Citigroup Capital Partners II, L.P. and/or the Citigroup Venture Capital International Growth Fund II, L.P., (iii) your vested rights under any applicable pension or 401(k) plan, (iv) Claims arising after the date you sign this Agreement, (v) your rights to indemnification under the applicable by-laws (and any amendments thereto) or applicable law, and (vi) any Claims that by law may not be
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waived or released, including your rights to COBRA, workers compensation, and unemployment insurance (the application for which shall not be contested by Citi).
a.Further, this Agreement does not limit or exclude the jurisdiction of any federal, state or local agency or self-regulatory organization. Accordingly, notwithstanding anything herein, this Agreement is not intended to, and shall not be construed to, prevent you from filing a charge or other proceeding with, or participating in an investigation or other proceeding conducted by, any governmental agency, including without limitation the U.S. Equal Employment Opportunity Commission (the “EEOC”) or applicable state or local fair employment practices (“FEP”) agency. However, as stated in Paragraph 3(d) above, and except as provided in Paragraph 11 below, you understand and agree that you shall not be entitled to receive any monetary compensation for Released Claims from Citi or Releasees in such proceeding.
b.The undersigned, on behalf of Citi’s senior management, represents and warrants that, as of the date hereof, they have no knowledge of any actions, events, or conduct on your part which: (i) could give rise to a claim or cause of action by Citi against you; and (ii) could give rise to a claim that you had engaged in any conduct constituting “Cause,” as such term is defined in any other agreement between you and Citi or any plan or policy of Citi.
1.No Admission.
You are entering into this Agreement as a compromise and in full and final settlement of all disputed Claims, if any, you have or may have against Citi and the Releasees as of the date you sign this Agreement. This Agreement does not constitute an admission of any liability or wrongdoing by Citi or the Releasees, and Citi denies that it is responsible or legally obligated to you for any such Claims, or that it has engaged in any wrongdoing.
2.Representations.
As of the date you sign this Agreement:
a.Subject to Paragraphs 3(g) and 11 of this Agreement, you represent and warrant that you have not filed, directly or indirectly, nor caused to be filed, any legal proceeding against Citi or the Releasees in any state or federal court or in arbitration, or any administrative proceeding with any federal, local or state agency having jurisdiction over claims of employment discrimination, claims for past or future wages, salary, bonuses, stock, stock options or other forms of compensation or benefits, including but not limited to claims arising under CAP, DCAP, the PSU program, or any other issues concerning your employment, the terms and conditions of your employment, and/or the separation of your employment from Citi.
b.You represent and warrant that you have submitted all business-related expenses for reimbursement pursuant to the applicable Citi Expense Management Policy and that you have no unpaid, outstanding debts due to Citi on your business credit card or for tax equalization, wage overpayment or the like. If there is an outstanding debt due to Citi, you agree to pay such debt immediately and, in the event you do not pay such debt prior to your Termination Date, you authorize Citi to deduct any amounts owed from the Initial Payment.
1.Confidential Information and Return of Citi Property.
a.You acknowledge and agree that any confidential, secret and/or proprietary information regarding Citi, including any nonpublic information regarding Citi’s business, products and services, methods, systems, and business plans, and nonpublic information regarding Citi’s current, former and prospective employees, clients and vendors (“Confidential Information”), is the exclusive property of Citi. Notwithstanding the above, Confidential Information shall not include any information in your possession or known to you prior to your employment with Citi, your contact lists, whether in electronic or paper form (e.g. rolodex, Outlook contacts, etc.), any information that is generally known in the industry or in the public domain, or any information that becomes generally known in the industry or in the public domain through no wrongful act on your part. You further acknowledge and agree that, as of the date you sign this Agreement, you have not disclosed or used, and you have an ongoing obligation not to disclose or use, either directly or indirectly, any Confidential Information for any reason except as otherwise provided in Paragraphs 3(g) and/or 11 of this Agreement or as required by a statute, by a court of law, or by any government, regulatory, or self-regulatory agency having supervisory authority over the business of Citi with jurisdiction to order you to divulge, disclose or make accessible such information. Except as to an inquiry by any government, regulatory, or self-regulatory agency or as otherwise provided in Paragraphs 3(g) and/or 11 of this Agreement, prior to disclosure, you shall give notice to the Global Employment Law Group, Citigroup Inc., 388 Greenwich Street, 17th Floor, New York, NY 10013, of any such request or demand for Confidential Information promptly upon your receipt of same, and shall reasonably cooperate with Citi in any application Citi may make seeking a protective order or barring disclosure of such Confidential Information.
b.Except as otherwise provided by law or in Paragraphs 3(g) and/or 11 of this Agreement, you agree to return on or before your last day of work (i) all Confidential Information in your possession, custody or control, including all customer and client lists, all books, records, documents and any other information in your possession which relate to Citi’s customers or business, and (ii) all other Citi property in your possession, custody or control, including all equipment (including laptops and computers with applicable passwords), and any keys, access cards, and corporate credit and calling cards. Further, you will change your voicemail message as instructed. Notwithstanding anything to the contrary in this Agreement, you may retain your contact lists, whether in electronic or paper form (e.g. rolodex, Outlook contacts, etc.) and copies of documents related to your compensation and benefits.
Wei-Chung Hu March 12, 2021
2.Confidential Agreement.
a.Except as otherwise provided by law or in Paragraphs 3(g) and/or 11 of this Agreement, you hereby: (i) agree to keep the Separation Benefits strictly confidential and not to disclose such information in any manner whatsoever, whether orally or in writing, whether directly or indirectly, to any person or entity other than your attorney, accountant, financial advisor, and immediate family (individually and collectively, “Covered Person”); and (ii) represent that neither you nor anyone acting on your behalf has previously made any such disclosure.
b.Notwithstanding anything to the contrary in this Agreement, your obligations under this Paragraph 7 do not apply to the tax structure or tax treatment of the transactions described in this Agreement, and you (or a Covered Person) may disclose, within the limitations of any law, the tax structure and tax treatment of these transactions and documents related to them (including opinions or other tax analysis).
1.Non-Disparagement.
Except as otherwise provided by law or in Paragraphs 3(g) and/or 11 of this Agreement, you agree: (i) not to disparage or denigrate Citi or the Releasees orally or in writing; and
(ii) that neither you nor anyone acting on your behalf will publish, post, or otherwise release any material in written or electronic format, make speeches, give interviews, or make public appearances that disparage Citi, its operations, clients, employees, products, or services without the prior written consent of the General Counsel of Citigroup Inc. For the sole purpose of your job duties in any future employment that requires you to comment publicly on Citi, the non-disparagement obligations set forth in this Paragraph 8 are limited to your use of any information that you learned during or as a result of your employment with Citi. Subject to Paragraph 11 herein, Citi agrees to instruct Michael Corbat and Jane Fraser as of the date hereof that, for so long as they are a Citi employee, they must not defame or disparage you in any medium to any person or entity.
2.Non-Solicitation.
During your Transition and Notice Periods and for the one-year period following your Termination Date, to the extent permitted by law, you agree that you will not (a) engage in any conduct, either individually or in concert with a third party, which, directly or indirectly, causes or attempts to cause any Citi employee to leave the employment of Citi for the purposes of employment outside of Citi regardless of whether the solicitation for employment originates from the Citi employee, or (b) directly or indirectly, induce or otherwise counsel, advise, encourage or solicit, including through the use of social media, any client of Citi whom you serviced or had substantial contact during your employment to terminate its relationship with Citi or to transfer assets away from or otherwise reduce its business with Citi. To the extent this provision conflicts with any other provision in any agreement regarding non-solicitation, including but not limited to the Citi Employment Termination Notice and Nonsolicitation Policy, this provision shall control. Citi hereby agrees and confirms that you are not subject to any non-compete.
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3.Duty to Provide Information.
a.Except as otherwise provided by law or in Paragraph 3(g), this Paragraph 10, and/or Paragraph 11 of this Agreement, you agree, at Citi’s reasonable request, to provide information to Citi and its attorneys as may be required in connection with the defense, investigation or prosecution of any third party claim that has been, or in the future may be, made against Citi, or in connection with any ongoing or future investigation or claim of any kind involving Citi, including any formal or informal proceeding before any Relevant Authority (including responding to any formal or informal requests for documents or testimony), with the understanding that any meetings you are requested to attend are scheduled during normal business hours at mutually agreeable times, with regard for your personal and business commitments.
For purposes of this Agreement, a “Relevant Authority” is any domestic or international court of law, governmental or regulatory agency or self-regulatory organization having supervisory authority over the business of Citi or any domestic or international arbitral, administrative, judicial or legislative body (including a committee thereof), including the U.S. Securities and Exchange Commission (“SEC”), the Financial Industry Regulatory Authority, Inc. (“FINRA”) or the Office of the Comptroller of the Currency (“OCC”).
b.You further agree, unless otherwise provided by law or in this Paragraph 10, to execute and deliver any documents that may reasonably be necessary for, and customarily associated with, carrying out the provisions of this Paragraph 10. Further, you agree that you will advise Citi of any contact made by attorneys or other agents on behalf of, or with respect to, private parties (other than Citi) with legal claims involving Citi. Should you agree to speak with such private party (or any representative thereof) regarding information you learned through and during your employment with Citi, you will permit a Citi representative to attend such meeting, where permitted by law, to prevent disclosure of privileged information or Confidential Information.
c.Nothing in this Paragraph 10 shall require you to take any action prejudicial to your legal interests or be construed to limit in any way the provisions of Paragraph 11 of this Agreement, and the requirements of this Paragraph 10 shall not apply in any circumstances in which such requirements would have the effect of prohibiting or restricting you from providing evidence or other information to any government, regulatory, or self-regulatory agency.
d.Citi shall reimburse you for any reasonable costs and expenses incurred by you in connection with your cooperation hereunder (including, but not limited to: travel; accommodations; and subject to the applicable indemnification provisions (including, without limitation, those regarding recoupment if you do not meet the relevant standard of conduct), reasonable attorney’s fees in the event it is necessary for you to retain separate counsel in connection with your cooperation under this Paragraph 10)).
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1.Disclosure of Information to Government, Regulatory or Self-Regulatory Agency and Other Permitted Disclosures.
a.Nothing contained in this Agreement is intended to prohibit or restrict you or Citi from providing evidence or other information to any government, regulatory, or self-regulatory agency such as (without limitation) the SEC, the Commodity Futures Trading Commission (“CFTC”), the Department of Justice (“DOJ”), FINRA, the National Labor Relations Board (“NLRB”), the New York Stock Exchange, Inc. (“NYSE”), or the EEOC, or from responding to any court order or subpoena, or from participating in any reward program offered by any government, regulatory, or self-regulatory agency. You may also disclose confidential information, including trade secrets, to (a) any government, regulatory, or self- regulatory agency, including under Section 21F of the Securities and Exchange Act of 1934, Section 23 of the Commodity Exchange Act of 1936, or Section 7 of the Defend Trade Secrets Act of 2016 (“Defend Trade Secrets Act”), and the rules thereunder, or (b) an attorney in connection with the reporting or investigation of a suspected violation of law or to an attorney or in a court filing under seal in connection with a retaliation or other lawsuit or proceeding, as permitted under the Defend Trade Secrets Act.
You do not need the prior authorization of Citi to make these disclosures or provide evidence or other information to any government, regulatory, or self-regulatory agency, and you are not required to notify Citi that you have done so.
The disclosures permitted under this Paragraph 11(a) are intended for regulatory and/or law enforcement purposes. It does not permit disclosure for commercial or competitive purposes of any confidential information, including trade secrets, to government owned, related or sponsored agencies, entities or enterprises that compete directly or indirectly with Citi and its businesses.
b.Further, you and Citi may disclose the terms of this Agreement if necessary in any action to enforce this Agreement. Except with regard to an inquiry by or other disclosure to any government, regulatory, or self-regulatory agency as provided in Paragraph 11(a) above, you will promptly give notice of any attempt to compel disclosure of the terms of this Agreement to the Global Employment Law Group, Citigroup Inc., at the address specified in Paragraph 6(a) above, as soon as possible and at least five days before compliance is required.
c.For the avoidance of doubt, nothing in this Agreement (including but not limited to the provisions set forth in Paragraphs 7 and 8 above) shall prohibit, prevent or otherwise restrict you or Citi from (i) initiating, testifying, assisting, complying with a subpoena from, or participating in any manner with an investigation conducted by the appropriate local, state or federal agency; (ii) filing or disclosing facts necessary to receive unemployment insurance, Medicaid, or other public benefits to which you are entitled; or (iii) making any other disclosures which are otherwise permitted by applicable federal, state or local law, or under the terms of the Agreement.
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1.Enforceability.
a.This Agreement shall be governed by the laws of the State of New York (regardless of conflict of laws principles) as to all matters including, without limitation, validity, construction, effect, performance, and remedies except where otherwise provided by law, in which case, it shall be governed by the laws of the state in which you currently work.
b.The invalidity or unenforceability of any provision of this Agreement shall have no effect upon, and shall not impair the validity or enforceability of any other provision of this Agreement, or of this Agreement in its entirety in any other jurisdiction. You and Citi agree that if any provision herein is found to be invalid or unenforceable by a court of competent jurisdiction, you and Citi will request that the court revise the provision to come closest to the meaning intended and the provision will be enforced as rewritten without affecting any other provision of this Agreement. To the extent it may be necessary, you agree to cooperate with Citi and its attorneys in seeking any regulatory, governmental or court approval of the terms of this Agreement in order to ensure that it is fully enforceable as written.
2.Arbitration.
In the event of any disputes arising out of or relating in any way to the validity, interpretation, or enforcement of this Agreement, other than injunctive relief and disputes which by law or statute are not arbitrable, the parties agree first to engage in prompt and serious good faith discussions to resolve the dispute. If such discussions fail to resolve the dispute within thirty (30) days, the parties shall try to resolve the dispute through mediation using the services of JAMS. If such mediation fails to resolve the dispute, the parties shall submit the dispute to arbitration pursuant to Citi’s Employment Arbitration Policy in effect as of your Termination Date. The decision of the arbitrator(s) will be final and binding. Judgment upon the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. Each party will bear its own attorneys’ fees and expenses in mediation and arbitration except, and only to the extent permitted by applicable statute, as may be awarded in arbitration. Nothing contained herein shall limit your or Citi’s right to obtain injunctive relief in a court of law in aid of arbitration.
3.Payment/Modification by Citi.
a.You acknowledge and agree that you and Citi intend for this Agreement to be administered in accordance with Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), and the Treasury pronouncements relating thereto. You further agree that this Agreement may be amended by Citi to the extent necessary in Citi’s judgment to comply with the Code, and any rules, regulations and Treasury pronouncements relating thereto in order to preserve the payments and benefits provided herein without additional cost to Citi. In no event shall Citi be liable for any Section 409A additional tax, penalties or interest, or for any damages, as a result of any amendment of or failure to amend this Agreement.
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a.Provided you timely sign this Agreement, the Separation Pay to be paid to you pursuant to Paragraph 1(d) above and the Initial Payment to be paid to you pursuant to Paragraph 1(e) above will be paid as soon as practical following the later of your Termination Date or the Effective Date of this Agreement but in no event later than March 15, 2022.
1.Breach of this Agreement.
a.You agree that in the event of any material misrepresentation or material breach by you of any part of this Agreement, Citi may recover any amounts paid to you herein, cancel your unpaid CAP and DCAP awards, and seek any other remedies available to it.
b.You further acknowledge and agree that Citi’s remedies at law for a breach or threatened breach of any of the provisions of the above Paragraphs 3, 6, 7(a), 8, 9 or 10 would be inadequate and, therefore, in addition to any remedies at law or under the terms of the applicable benefit or equity plans, Citi shall be entitled to seek equitable relief in the form of specific performance, temporary restraining order, temporary or permanent injunction, or any other equitable remedy which may then be available.
2.Knowing and Voluntary Agreement.
You acknowledge that (a) you have read and understand each of the provisions of this Agreement; (b) you are hereby advised to consult with an attorney prior to signing this Agreement; (c) you have 21 days from your receipt of this Agreement to review it and to consider your decision to sign it (the “Review Period”), although you may return it to the undersigned prior to that time if you desire, provided you have ceased performing your current job duties; (d) you are entering into this Agreement of your own free will; and (e) this Agreement is not intended to be a waiver of Claims arising after the date you sign this Agreement.
3.Revocation and Expiration of this Agreement.
Once you sign this Agreement, you have 7 days to revoke it (“Revocation Period”). You may do so by delivering to the undersigned written notice of your revocation within the Revocation Period. Your signed Agreement will become effective as of the date that you sign and return it, provided that (i) you have signed and returned it within the Review Period, (ii) you have not revoked it during the Revocation Period, and (iii) this Agreement is signed on behalf of Citi (“Effective Date”).
4.Other Terms and Conditions.
a.This Agreement sets forth the entire agreement and understanding relating to your employment with and separation from Citi, and supersedes all prior discussions, negotiations, and agreements with respect to the subjects contained herein, except for any applicable benefit plans, discretionary incentive and retention compensation
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plans or programs and limited partnerships or other employee investment plans. In entering into this Agreement, you acknowledge and agree that you are not relying on any representations by Citi or any other Releasees other than those expressly contained in this Agreement.
a.Except as provided in Paragraph 14 above, no amendment or modification to this Agreement shall be valid unless made in a separate writing and signed by you and a duly authorized representative of Citi. Any handwritten comments, inserts or interlineations of this Agreement will not be accepted under any circumstances and shall render this Agreement null and void.
b.The section headings appearing in this Agreement are used for convenience of reference only and shall not be considered a part of this Agreement nor be construed in any way to modify, amend or affect the meaning of any of its provisions.
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Wei-Chung Hu March 12, 2021
Citibank, N.A.
Sara Wechter Date
Head of Human Resources
BY SIGNING THIS AGREEMENT, YOU GIVE UP AND WAIVE LEGAL RIGHTS.
YOU ARE HEREBY ADVISED BY CITI TO CONSULT WITH AN ATTORNEY BEFORE SIGNING THIS AGREEMENT.
BY SIGNING BELOW, YOU ACKNOWLEDGE THAT YOU HAVE READ THIS AGREEMENT AND UNDERSTAND ALL OF ITS TERMS. YOU SIGN AND ENTER THIS AGREEMENT KNOWINGLY AND VOLUNTARILY WITH FULL KNOWLEDGE OF WHAT IT MEANS.
3/12/2021
_____________________Wei-Chung Hu Date
Wei-Chung Hu March 12, 2021
EXHIBIT A
Citigroup Inc.
Deferred Cash Award Plan Award Agreement Summary
Citigroup Inc. (“Citigroup”) hereby grants to Wei-Chung Hu (the “Participant”) the award summarized below pursuant to the terms of the agreement between Citibank, N.A. and Participant dated March 12, 2021 (the “Letter Agreement”) and the Discretionary Incentive and Retention Award Plan, as amended and restated effective as of January 1, 2015 (“DIRAP”). The terms, conditions and restrictions of your award are contained in this Award Agreement, including the attached Terms and Conditions (together, the “Agreement”) and the Deferred Cash Award Plan, as amended and restated effective as of January 1, 2015 (“DCAP”).
For the award to be effective, you must accept below acknowledging that you have received and read this Agreement, including the Data Protection Statement.
Summary of Participant’s Deferred Cash Award (the “Deferred Cash Award”)
Award Date | February 11, 2021 | ||||
Principal amount | $3,252,598.54 | ||||
Notional interest rate (compounded annually) | 1.34% | ||||
Vesting dates (and percentage vesting) | January 20, 2022 (25%) January 20, 2023 (25%) January 20, 2024 (25%) January 20, 2025 (25%) | ||||
Acceptance and Agreement by Participant. I hereby accept the award described above, and agree to be bound by the terms, conditions, and restrictions of such award as set forth in this Agreement (which includes the attached Terms and Conditions) (acknowledging hereby that I have read and that I understand such document, which includes the Data Protection Statement), and Citigroup’s policies, as in effect from time to time, relating to the administration of Citigroup’s incentive compensation programs.
CITIGROUP INC. PARTICIPANT'S ACCEPTANCE:
By: Sara Wechter Wei-Chung Hu
Head of Human Resources
Wei-Chung Hu March 12, 2021
CITIGROUP INC. DEFERRED CASH AWARD PLAN
AWARD AGREEMENT TERMS AND CONDITIONS
The Terms and Conditions below constitute part of this Agreement and relate to the Deferred Cash Award described on the preceding Summary page. All references to the Deferred Cash Award in this Agreement will include any notional interest accrued thereon. Except as otherwise provided herein, the “Company” means Citigroup and its consolidated subsidiaries. The “Committee” means the Personnel and Compensation Committee of the Citigroup Board of Directors and any person with authority directly or indirectly delegated from the Committee.
1.Participant Acknowledgements. By accepting the Deferred Cash Award, Participant acknowledges that:
(a)He has read and understands these Terms and Conditions.
(b)The Deferred Cash Award will be canceled or reduced if a clawback provision is applied.
(c)The Deferred Cash Award is in satisfaction of the obligation to pay the deferred cash award described in paragraph 1(e) of the Letter Agreement.
(d)A Deferred Cash Award is an unsecured general obligation of any employer that employed Participant during the deferral period applicable to the Deferred Cash Award and, until paid in accordance with its terms, is subject to the claims of such employer’s creditors. The currency in which Participant’s Deferred Cash Award is denominated and/or paid and any required tax withholding and reporting will be in accordance with Citigroup’s policies, as in effect from time to time, relating to the administration of Citigroup’s incentive compensation programs.
2.Vesting Conditions. Your Deferred Cash Award shall vest on the scheduled vesting dates in accordance with the terms of this Agreement notwithstanding your status as a former employee. If the conditions to vesting are not satisfied as of the applicable vesting date(s), the unvested portion of the Deferred Cash Award will be subject to cancelation as set forth in this Agreement.
(a)Performance-Based Vesting Condition and General Clawback.
(i)Participant’s Deferred Cash Award is subject to the following condition (a “Performance Vesting Condition”). The Committee may cancel all or a portion of an unvested Deferred Cash Award if it determines, in its sole discretion, that Participant has had significant responsibility for a material adverse outcome for Citigroup or any of its businesses or functions. The Committee has the exclusive discretionary authority to determine and define “significant responsibility” and “material adverse outcome” and all other undefined terms in this Agreement. As of the date hereof, Citi is not aware of any determination that you have “significant responsibility” for a “material adverse outcome for Citigroup or any of its businesses or functions” as defined in this paragraph.
(ii)Participant’s Deferred Cash Award is subject to the following clawback condition (the “General Clawback”). The Committee may cancel all or a portion of an unvested Deferred Cash Award if it determines, in its judgment, that (1) Participant engaged in behavior (I) constituting misconduct; (II) constituting the exercise of materially imprudent judgment that caused harm to any of the Company’s business operations; or (III) that resulted or could result in regulatory sanctions (whether or not formalized) to the Company and/or the Participant; or (2) Participant failed to supervise or monitor individuals engaging in, or Participant failed to properly escalate, in accordance with the Company’s policies, behavior (I) constituting misconduct; (II) constituting the exercise of materially imprudent judgment that caused harm to any of the Company’s business operations; or (III) that resulted or could result in regulatory sanctions (whether or not formalized) to the Company and/or the Participant.
Wei-Chung Hu March 12, 2021
i.The Performance Vesting Condition and General Clawback described in this Section 2(a) and other terms of the Award do not change during the deferral period of the Award. The Performance Vesting Condition and General Clawback are not modified solely because Participant terminates employment with the Company.
a.Citi Clawback. Any unvested portion of the Deferred Cash Award will be canceled or forfeited if the Committee, in its judgment, determines that (i) Participant received the Award based on materially inaccurate publicly reported financial statements, (ii) Participant knowingly engaged in providing materially inaccurate information relating to publicly reported financial statements, (iii) Participant materially violated any risk limits established or revised by senior management and/or risk management, or (iv) Participant has engaged in “gross misconduct” (the “Citi Clawback”). For purposes of this Agreement, “gross misconduct” means any conduct that is determined by the Committee, in its sole discretion, (1) to be in competition during employment by the Company with the Company’s business operations, (2) to be in breach of any obligation that Participant owes to the Company or Participant’s
duty of loyalty to the Company, (3) to be materially injurious to the Company, or (4) to otherwise constitute gross misconduct under the Company’s guidelines.
b.Letter Agreement. Any unvested portion of the Deferred Cash Award may be canceled or forfeited if Participant has breached any covenant contained in paragraphs 1(i), 1(j), 3, 5(a), 6, 7, 8, 9, or 10 of the Letter Agreement.
c.Notional Interest. Participant acknowledges that the Deferred Cash Award does not provide for actual interest payments but, if and when paid, includes an additional amount calculated with reference to an interest rate. This notional interest on the Deferred Cash Award will be calculated at the rate indicated in the Deferred Cash Award Summary on page 1 of this Agreement. The payment of a vested installment of the Deferred Cash Award will include the accrued notional interest on the value of the installment that vests after the Performance Vesting Condition described in Section 2(a) is applied and all other conditions to vesting are satisfied.
d.Additional Conditions.
(i)Once all applicable conditions to vesting have been satisfied, Participant’s vested Deferred Cash Award will be distributed as soon as administratively practicable, except as may be provided elsewhere in this Agreement. Vesting and payment in each case are subject to receipt of the information necessary to make required tax payments and confirmation by Citigroup that all applicable conditions to vesting and distribution or payment have been satisfied. All payments pursuant to the Deferred Cash Award are net of any amounts withheld for taxes.
(ii)Notwithstanding anything in this Agreement to the contrary, the Committee may suspend the vesting and payment of Participant’s Deferred Cash Award pending an investigation into whether there are circumstances that would prevent Participant’s Deferred Cash Award from vesting under the general vesting conditions or Performance Vesting Condition, or subject the Deferred Cash Award to
forfeiture pursuant to a clawback provision that is applicable to Participant’s Deferred Cash Award.
(iii)If it is subsequently determined (whether following an investigation or otherwise) that vesting conditions are, in fact, not satisfied with respect to the Deferred Cash Award, such Deferred Cash Award may be reduced or canceled. If it is subsequently determined (whether following an investigation or otherwise) that vesting conditions were, in fact, not satisfied with respect to the Deferred Cash Award that should not have been paid or vested, Participant will be obligated, pursuant to Section 4 of this Agreement, to return or repay to the Company any improperly vested amounts.
1.Transferability. The unvested portion of the Deferred Cash Award may not be sold, pledged, hypothecated, assigned, margined or otherwise transferred, other than by will or the laws of descent and distribution, and no Deferred Cash Award or interest or right therein shall be subject to the debts, contracts or engagements of Participant or his successors in interest or will be subject to disposition by
Wei-Chung Hu March 12, 2021
transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law, by judgment, lien, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy or divorce), and any attempted disposition thereof will be null and void, of no effect, and not binding on the Company in any way. Participant agrees that any purported transfer will be null and void, and will constitute a breach of this Agreement causing damage to the Company for which the remedy will be cancelation of the Deferred Cash Award. During Participant’s lifetime, all rights with respect to the Deferred Cash Award will be exercisable only by Participant, and any and all payments in respect of the Deferred Cash Award will be to Participant only. The Company will be under no obligation to entertain, investigate, respect, preserve, protect or enforce any actual or purported rights or interests asserted by any creditor of Participant or any other third party in the Deferred Cash Award, and Participant agrees to take all reasonable measures to protect the Company against any such claims being asserted in respect of Participant’s Deferred Cash Award and to reimburse the Company for any and all reasonable expenses it incurs defending against or complying with any such third-party claims if Participant could have reasonably acted to prevent such claims from being asserted against the Company.
1.Repayment Obligations and Right of Set-Off.
i.Repayment Obligations. If the Committee determines that all conditions to vesting and payment of the Deferred Cash Award (or any portion thereof) were not satisfied in full, the Committee will cancel such vesting and immediately terminate Participant’s rights with respect to such Deferred Cash Award (or improperly vested portion thereof). If any such Deferred Cash Award (or improperly vested portion thereof) has already been paid, Participant agrees, upon demand, to pay the Company the amount of any cash paid in settlement of the vesting of such Deferred Cash Award (or improperly vested portion thereof), without reduction for any amounts withheld to satisfy withholding tax or other obligations due at the time such payment that is subsequently determined to have been improperly made.
ii.Right of Set-Off. Participant agrees that the Company may, to the extent determined by the Company to be permitted by applicable law and consistent with the requirements of Section 409A of
the U.S. Internal Revenue Code of 1986, as amended (the “Code”), retain for itself funds otherwise payable to Participant pursuant to the Deferred Cash Award or any award under any award program administered by Citigroup to offset (i) any amounts paid by the Company to a third party pursuant to any award, judgment, or settlement of a complaint, arbitration, or lawsuit of which Participant was the subject; or (ii) any outstanding amounts (including, without limitation, travel and entertainment or advance account balances, loans, repayment obligations under any award agreement, or any obligations pursuant to a tax- equalization or housing allowance policy or other expatriate benefit) that Participant owes the Company or its affiliates. The Company may not retain such funds and set-off such obligations or liabilities, as described above, until such time as they would otherwise be payable to Participant in accordance with the award terms. Only after-tax amounts will be applied to set-off Participant’s obligations and liabilities and Participant will remain liable to pay any amounts that are not thereby satisfied in full.
2.Consent to Electronic Delivery. In lieu of receiving documents in paper format, Participant hereby agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that Citigroup may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, brochures, grant or award notifications and agreements, account statements, annual and quarterly reports, and all other forms or communications) in connection with the Deferred Cash Award and any other prior incentive award or program made or offered by Citigroup or its predecessors or successors. Electronic delivery of a document to Participant may be via a secure internet site to which Participant has access.
3.Plan Administration. The Deferred Cash Award described in this Agreement has been granted subject to the terms of the DCAP plan document. The Committee, and its delegates, including the Plan Administrator (as defined in the DCAP plan document), has the exclusive discretionary authority to make findings of fact, conclusions, and determinations regarding the interpretation of this Agreement or the DCAP provisions or the administration of the Deferred Cash Award, and will have the exclusive and final authority to determine all calculations of Deferred Cash Award amounts, including notional interest. The
Wei-Chung Hu March 12, 2021
Committee, and its delegates, including the Plan Administrator, has the exclusive authority to establish administrative procedures to implement the terms of the Deferred Cash Award. Any such procedure will be conclusive and binding on Participant. The Committee and Plan Administrator must exercise their discretion reasonably and in good faith.
1.Taxes and Tax Residency Status.
i.Compliance. By accepting the Deferred Cash Award, Participant agrees to pay all applicable taxes (or hypothetical tax if Participant is subject to tax equalization or tax protection pursuant to a Citigroup Expatriate policy) and to file all required tax returns in all jurisdictions where Participant is subject to tax and/or an income tax filing requirement. To assist Citigroup in achieving full compliance with its obligations under the laws of all relevant taxing jurisdictions, Participant agrees to keep complete and accurate records of his income tax residency status and the number and location of workdays outside his country of income tax residency from the date of the Deferred Cash Award until the vesting of the Deferred Cash Award. Participant also agrees to provide, upon request, complete and accurate information about his tax residency status to Citigroup during such periods, and confirmation of his status as a (i) U.S. citizen, (ii) holder of a U.S. green card, or (iii) citizen or legal resident of a country other than the U.S. Participant will be responsible for any tax due, including penalties and interest, arising from any misstatement by Participant regarding such information.
ii.Deferred Cash Award. To the extent the Company is required to withhold tax in any jurisdiction upon the vesting of the Deferred Cash Award or at such times as otherwise may be required in connection with the Deferred Cash Award, the Company will withhold from the vested portion of the Award to the extent permitted by applicable law, or withhold hypothetical tax pursuant to a Citigroup Expatriate policy, and Participant will be paid the after-tax or after-hypothetical tax amount. If a tax or hypothetical tax the Company is required to withhold is due prior to vesting and withholding is prohibited by applicable law or regulatory guidance, Participant will be required to pay the amount of the applicable tax due to the Company. The Award will be subject to cancelation if Participant fails to make any such required tax payment.
2.Entire Agreement. The plan and program documents, the Letter Agreement, and this Agreement constitute the entire understanding between the Company and Participant regarding the Deferred Cash Award and supersede all previous written, oral, or implied understandings between the parties hereto about the subject matter hereof, including any written or electronic agreement, election form or other communication to, from or between Participant and the Company.
3.Adjustments to the Deferred Cash Award.
iii.Modifications. The Committee retains the right to modify Participant’s Deferred Cash Award if required to comply with applicable law (including applicable tax law) without Participant’s prior consent. Citigroup will furnish or make available to Participant a written notice of any modification, which notice will specify the effective date of such modification. Any other adverse modification not elsewhere described in this Agreement will not be effective without Participant’s written consent.
iv.Adverse Consequences. Neither the Committee nor Citigroup will be liable to Participant for any additional personal tax or other adverse consequences of any adjustments that are made to the Deferred Cash Award.
4.Section 409A and Section 457A Compliance. Participant understands that as a result of Section 409A and/or Section 457A of the Code, if Participant is a U.S. taxpayer he could be subject to adverse tax consequences if the Deferred Cash Award or the DCAP plan document is not administered in accordance with the requirements of Section 409A or Section 457A. Participant further understands that if Participant is a U.S. taxpayer, and the Deferred Cash Award is considered to be a “nonqualified
deferred compensation plan” and Participant’s employer is considered to be a “nonqualified entity” (as such terms are defined in Section 409A and/or Section 457A of the Code), Participant could be subject to accelerated income recognition or other adverse tax consequences with respect to all or a portion of the Deferred Cash Award. In such circumstances, Citigroup may, but will not be required to, modify or amend
Wei-Chung Hu March 12, 2021
the Deferred Cash Award, as provided by the DCAP plan document. However, Participant acknowledges that there is no guarantee that the Deferred Cash Award, or any amendment or modification thereto, will successfully avoid unintended tax consequences to Participant and that the Company does not accept any liability therefor.
1.Compliance with Regulatory Requirements. The Deferred Cash Award is subject to the applicable law (including tax laws) and regulatory guidance in multiple jurisdictions, and will be administered and interpreted consistently with such law and regulatory guidance, including but not limited to Section 409A and Section 457A of the Code.
2.Arbitration; Conflict; Governing Law; Severability.
i.Arbitration. Any disputes related to the Deferred Cash Award will be resolved by arbitration in accordance with paragraph 12 of the Letter Agreement. In the absence of an effective arbitration policy, Participant understands and agrees that any dispute related to the Deferred Cash Award will be submitted to arbitration in accordance with the rules of the American Arbitration Association. To the maximum extent permitted by law, and except where expressly prohibited by law, arbitration on an individual basis will be the exclusive remedy for any claims that might otherwise be brought on a class, representative or collective basis. Accordingly, Participant may not participate as a class or collective action representative, or as a member of any class, representative or collective action, and will not be entitled to a recovery in a class, representative or collective action in any forum. Any disputes concerning the validity of this class, representative or collective action waiver will be decided by a court of competent jurisdiction, not by an arbitrator.
ii.Conflict. In the event of a conflict between this Agreement and the Letter Agreement, the Letter Agreement will control. In the event of a conflict between this Agreement and the DCAP plan document, this Agreement will control.
iii.Governing Law. This Agreement will be governed by the laws of the State of New York (regardless of conflict of laws principles) as to all matters, including, but not limited to, the construction, application, validity and administration of the Company’s incentive award programs.
iv.Severability. The terms of this Agreement will be deemed severable so that if any of its provisions will be held void, unlawful, or unenforceable under any applicable statute or other controlling law, the remainder of this Agreement will continue in full force and effect, and will be construed and enforced in accordance with the purposes of the DCAP plan document as if the illegal or invalid provision did not exist.
3.Disclosure Regarding Use of Personal Information.
v.Data Protection Statement and Use of “Personal Information.”
(i)Where the General Data Protection Regulation (2016/679) (“GDPR”) applies, please refer to the Data Protection Statement attached as Schedule 1.
(ii)Where the GDPR does not apply, the following provisions apply:
In connection with the grant of the Deferred Cash Award, and any other award under other incentive award programs, and the implementation and administration of any such program, it is or may become necessary for the Company to collect, transfer, use, and hold certain personal information regarding Participant in and/or outside of Participant’s country of employment.
The “personal information” that the Company may collect, process, use, store and transfer for the purposes outlined above includes Participant’s name, nationality, citizenship, tax or other residency status, work authorization, date of birth, age, government/tax identification number, passport number, brokerage account information, GEID or other internal identifying information, home address, work
Wei-Chung Hu March 12, 2021
address, job and location history, compensation and incentive award information and history, business unit, employing entity, and Participant’s beneficiaries and contact information. Participant may obtain more details regarding the access and use of his personal information, and may correct or update such information, by contacting his human resources representative or local equity coordinator.
Use, transfer, storage and processing of personal information, electronically or otherwise, shall be for the performance of this Agreement and the Company’s internal administration of its incentive award programs, and in connection with tax or other governmental and regulatory compliance activities directly or indirectly related to an incentive award program, including the prevention, detection and prosecution of crime or other grounds of public interest. In accordance with the Company’s personal information and data policies and standards, personal information may be stored in, or accessed from or transferred to countries where data privacy laws may not be as protective as those in the country from which the personal information was provided. Participant agrees to the processing of personal information as described herein under confidentiality and privacy terms to the same standard set out herein. For such purposes only, personal information may be used by third parties retained by the Company to assist with the administration and compliance activities of its incentive award programs, and may be transferred by
the company that employs (or any company that has employed) Participant from Participant’s country of employment to other Citigroup entities and third parties located in the United States and in other countries. Specifically, those parties that may have access to Participant’s information for the purposes described herein include, but are not limited to, (i) human resources personnel responsible for administering the award programs, including local and regional equity award coordinators, and global coordinators located in the United States; (ii) Participant’s U.S. broker and equity account administrator and trade facilitator; (iii) Participant’s U.S., regional and local employing entity and business unit management, including Participant’s supervisor and his superiors; (iv) the Committee or its designee, which is responsible for administering the DCAP; (v) Citigroup’s technology systems support team (but only to the extent necessary to maintain the proper operation of electronic information systems that support the incentive award programs); and (vi) internal and external legal, tax and accounting advisors (but only to the extent necessary for them to advise the Company on compliance and other issues affecting the incentive award programs in their respective fields of expertise). At all times, Company personnel and third parties will be obligated to maintain the confidentiality of Participant’s personal information except to the extent the Company is required to provide such information to governmental agencies or other parties. Such action will always be undertaken only in accordance with applicable law.
i.Participant’s Consent (not applicable where the GDPR applies). BY ACCEPTING THE DEFERRED CASH AWARD, PARTICIPANT EXPLICITLY CONSENTS TO THE USE, TRANSFER, PROCESSING AND STORAGE, ELECTRONICALLY OR OTHERWISE, OF HIS PERSONAL INFORMATION, AS SUCH USE HAS OCCURRED TO DATE, AND AS SUCH USE MAY OCCUR IN THE FUTURE, IN CONNECTION WITH THIS OR ANY OTHER DEFERRED CASH OR OTHER AWARD, AS DESCRIBED ABOVE.
***
SCHEDULE 1- DATA PROTECTION STATEMENT (APPLICABLE WHERE THE GDPR APPLIES)
Data Controller | Citigroup Inc. | ||||
Data Protection Officer | EMEA Chief Privacy Officer [Contact Information Intentionally Omitted] | ||||
Purpose and grounds for data processing | Implementation and administration of DIRAP and DCAP, including a participant’s actual participation in any similar or equivalent award plan or program. Data processing is necessary for the performance of this Agreement to which you, the data subject, are party. | ||||
Retention period | The Company will hold your personal information on its systems for the longest of the following periods: (i) as long as is necessary during your participation in DIRAP or DCAP; (ii) any retention period that is mandated by law; (iii) the Compensation Planning retention periods set out in the Company’s Retention Management Policy which are measured from maturity or from DIRAP or DCAP being superseded as follows: Lithuania staff: 6 years Malta and Romania staff: 10 Years All other 25 EU countries: 7 Years US Persons: 6 Years | ||||
Categories of Personal Information | Participant’s name, nationality, citizenship, tax or other residency status, work authorization, date of birth, age, government/tax identification number, passport number, brokerage account information, GEID or other internal identifying information, home address, work address, job and location history, compensation and incentive award information and history, business unit, employing entity, and Participant’s beneficiaries and contact information. | ||||
Recipients of Personal Information | (i)Human resources personnel responsible for administering the award programs, including local and regional equity award coordinators, and global coordinators located in the United States; (ii)Participant’s U.S. broker and equity account administrator and trade facilitator; (iii)Participant’s U.S., regional and local employing entity and business unit management, including Participant’s supervisor and his/her superiors; | ||||
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(iv)The Committee or its designee, which is responsible for administering the DIRAP and DCAP; (v)The Company’s technology systems support team (but only to the extent necessary to maintain the proper operation of electronic information systems that support the incentive award programs); and (vi)Internal and external legal, tax and accounting advisors (but only to the extent necessary for them to advise the Company on compliance and other issues affecting the incentive award programs in their respective fields of expertise). | |||||
Details of transfers outside the EU | Participant’s personal data may be transferred to the United States or another country that has not been certified by the European Commission as offering equivalent or "adequate protection" to the EU country of your last employment (or current residence). Information that is transferred between Citigroup and its affiliates is done in accordance with the Company’s Binding Corporate Rules. Where personal data is transferred to non-affiliated organizations (for the execution of investments, payments or any other transactions), the Company shall procure that such non-affiliated organizations agree to a similar level of protection as is provided under the Company’s Binding Corporate Rules. | ||||
Individual rights | Under the General Data Protection Regulation (EU) 2016/679 individuals have data subject rights including the right to access and correct personal data for data processed by or on behalf of any entity affiliated with the Company in the EU/EEA. You may exercise these rights by sending a written request to the EMEA Chief Privacy Officer identified above. | ||||
Right to complain | If you are unhappy with the way the Company has handled your personal information or any privacy query or request that you have raised with the EMEA Chief Privacy Officer, you have a right to lodge a complaint with a competent supervisory authority, in particular in the Member State of your habitual residence or place of work, of an alleged infringement of the GDPR. | ||||
Exhibit 31.01
CERTIFICATION
I, Jane Fraser, certify that:
1.I have reviewed this Quarterly Report on Form 10-Q of Citigroup Inc.;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: May 5, 2021 | ||
| /s/ Jane Fraser | ||
| Jane Fraser | ||
| Chief Executive Officer | ||
Exhibit 31.02
CERTIFICATION
I, Mark A. L. Mason, certify that:
1.I have reviewed this Quarterly Report on Form 10-Q of Citigroup Inc.;
2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
| Date: May 5, 2021 | ||
| /s/ Mark A. L. Mason | ||
| Mark A. L. Mason | ||
| Chief Financial Officer | ||
Exhibit 32.01
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report on Form 10-Q of Citigroup Inc. (the “Company”) for the quarter ended March 31, 2021 (the “Report”), Jane Fraser, as Chief Executive Officer of the Company, and Mark A. L. Mason, as Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
| /s/ Jane Fraser | ||
| Jane Fraser | ||
| Chief Executive Officer | ||
| May 5, 2021 | ||
| /s/ Mark A. L. Mason | ||
| Mark A. L. Mason | ||
| Chief Financial Officer | ||
| May 5, 2021 | ||
This certification accompanies each Report pursuant to § 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of § 18 of the Securities Exchange Act of 1934, as amended.
A signed original of this written statement required by § 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.
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