Employment Agreement - Citigroup Inc. and Sanford I. Weill
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This Amended and Restated Employment Agreement is made and
entered into as of November 16, 2001 by and between Citigroup Inc., a Delaware
corporation (together with its direct and indirect successors, the "COMPANY"),
and Sanford I. Weill ("WEILL").
WHEREAS, Commercial Credit Company, a predecessor to the
Company ("CCC"), previously entered into an Employment Agreement with Weill
dated as of December 31, 1987; and
WHEREAS, the Company and Weill desire to amend and restate
such Employment Agreement (as so amended and restated, this "AGREEMENT") to
provide for a continuing relationship.
NOW THEREFORE, the Company and Weill do hereby agree as
follows:
1. EMPLOYMENT. The Company agrees to employ Weill on a
full time basis as its Chairman of the Board and
Chief Executive Officer. Weill shall have in such
positions all of the duties, responsibilities and
powers afforded to such officers under the Articles
of Incorporation and By-laws of the Company, as in
effect from time to time. Weill agrees to render the
best services and efforts that he is capable of in
connection with the performance of such duties and
responsibilities.
2. PERSONAL ACTIVITIES OF WEILL. Notwithstanding
anything to the contrary contained in this Agreement,
nothing in this Agreement shall preclude Weill from
devoting reasonable periods of time to: (i) serving
as a director or member of a committee of any
organization which does not involve a material
conflict of interest with the interests of the
Company; (ii) engaging in charitable and community
activities; or (iii) managing his personal
investments; PROVIDED, HOWEVER, that such activities
do not interfere with the performance of his
employment duties and responsibilities under this
Agreement.
3. EMPLOYMENT TERM. The employment relationship created
by this Agreement shall commence as of the date of
this Agreement and shall continue until December 31,
2001. Such term shall automatically be renewed for
successive one-year periods beginning January 1,
2002, unless either party gives written notice of
non-renewal at least 60 days prior to any December 31
expiration (such term, including any automatic
renewal thereof, the "EMPLOYMENT TERM").
4. EMPLOYMENT COMPENSATION.
(a) In consideration for all employment services
rendered to the Company under this
Agreement, the Company agrees to pay to
Weill an annual salary at a rate to be
determined from time to time by the Board of
Directors of the Company or an authorized
committee thereof (including any such
determinations made prior to the effective
date of this Agreement); PROVIDED that any
reduction in such salary may only be made
with the prior written consent of Weill.
Such annual salary
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shall be payable in accordance with the
Company's regular payroll procedures.
(b) Weill shall be entitled to receive such
incentive payments, on an annual and/or
special basis, as may be determined from
time to time by the Board of Directors of
the Company or an authorized committee
thereof (including any such determinations
made prior to the effective date of this
Agreement). Such incentive payments may but
need not be part of incentive programs
established generally for senior officers of
the Company.
(c) Weill shall be entitled to participate in
such employee benefit programs as may be
determined from time to time by the Board of
Directors of the Company or an authorized
committee thereof (including any such
determinations made prior to the effective
date of this Agreement).
(d) (i) All stock options granted to Weill after
the date of this Agreement (including any
reload stock options) shall provide, and
(ii) all stock options held by Weill as of
the date of this Agreement shall be amended
to provide, that such options shall (x)
immediately vest on his Retirement (as
defined in Section 5(a) below) and (y)
subject to Section 7(b)(i)(y) below, remain
exercisable for their full respective terms
following any Retirement, except, in the
case of any stock options held as of the
date of this Agreement, if the same would
result in an accounting charge to the
Company, as determined by the Company's
outside accounting firm.
5. TERMINATION OF EMPLOYMENT.
(a) Method of Termination. The employment
relationship created by this Agreement may
be terminated prior to the end of the
Employment Term as follows:
(i) By the Company, in the event of the
death of Weill.
(ii) By the Company, in the event of the
illness, physical or mental
disability or other incapacity of
Weill, if such incapacity or
disability renders Weill unable to
render those services to the
Company which he is obligated to
perform pursuant to the terms of
this Agreement.
(iii) By the Company, upon the giving of
at least 90 days prior written
notice, in the event Weill refuses
or neglects, in any material
respect, to attend to the
performance of his duties and
responsibilities in accordance with
the provisions of this Agreement
(other than by reason of illness or
disability as described in Section
5(a)(ii) above).
(iv) By the Company, for cause (meaning,
for purposes hereof, fraud or the
conviction of any crime
constituting a felony), effective
immediately.
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(v) By the Company, upon the giving of
at least 120 days prior written
notice, without cause.
(vi) By Weill, upon the giving of at
least 30 days prior written notice,
in the event of a material breach
by the Company of any of its
obligations under this Agreement.
(vii) In the event of the written consent
of both parties hereto, effective
as of the date specified in such
written consent.
Any termination of Weill's employment
pursuant to Sections 5(a)(ii), 5(a)(v),
5(a)(vi) or 5(a)(vii) above or pursuant to a
notice of non-renewal given by the Company
as described in Section 3 above shall be
deemed a "RETIREMENT" for purposes of this
Agreement.
(b) Termination Compensation. The following
provisions shall apply in the event of the
termination of the employment relationship
created by this Agreement:
(i) In the event of a termination
pursuant to Section 5(a)(i) above,
the Company shall pay to Weill (or
his executor or administrator, as
the case may be) the annual salary
and employee benefits in effect
immediately prior to such
termination through the end of the
year during which such termination
occurs or for six months following
such termination, whichever shall
be greater, and such additional
payments relating to incentive,
death, retirement or other matters
as may be determined to be
appropriate by the Board of
Directors of the Company or an
authorized committee thereof. Any
stock options held by Weill shall
immediately vest and become
exercisable, and any restrictions
on shares of restricted stock held
by Weill as of the date of such
termination shall immediately
lapse.
(ii) In the event of a termination
pursuant to Section 5(a)(ii) above,
subject to Weill's compliance with
the covenants set forth in Section
7(a) below, the Company shall
continue to pay to Weill (or his
legal guardian, as the case may be)
the annual salary and employee
benefits in effect immediately
prior to such termination through
the end of the year during which
such termination occurs or for six
months following such termination,
whichever shall be greater, and
such additional payments relating
to incentive, disability,
retirement or other matters as may
be determined to be appropriate by
the Board of Directors of the
Company or an authorized committee
thereof. In addition, Weill shall
have the rights regarding
Retirement as described in Section
5(b)(vi) below.
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(iii) In the event of a termination
pursuant to Sections 5(a)(iii) or
5(a)(iv) above or any termination
by Weill other than pursuant to
Section 5(a)(vi) above, the Company
shall pay to Weill his annual
salary and employee benefits in
effect immediately prior to such
termination through the effective
date of such termination. In
addition, Weill shall have such
rights, if any, to further vesting
and exercise of his stock options
or lapse of the restrictions on any
shares of his restricted stock as
are provided under the Company's
plan(s) under which such options or
stock were granted, as then
applicable.
(iv) In the event of a termination
pursuant to Sections 5(a)(v) or
5(a)(vi) above, the Company shall,
within 15 days after such
termination, pay to Weill a lump
sum amount in cash equal to the sum
of (x) his annual salary in effect
immediately prior to such
termination through the effective
date of such termination and (y)
the amount paid as his annual bonus
in respect of the Company's fiscal
year prior to the fiscal year in
which the effective date of such
termination occurs, prorated for
the period of his employment during
the fiscal year in which the
effective date of such termination
occurs. In addition, Weill shall
have the rights regarding
Retirement as described in Section
5(b)(vi) below.
(v) In the event of a termination
pursuant to Section 5(a)(vii) above
or pursuant to a notice of
non-renewal given by the Company as
described in Section 3 above, Weill
shall have the rights regarding
Retirement as described in Section
5(b)(vi) below.
(vi) If a termination of Weill's
employment is deemed a Retirement
for purposes of this Agreement,
then, commencing upon such
Retirement and subject to Weill's
compliance with the covenants set
forth in Section 7(a) below, (x)
the Company shall provide to Weill
a supplemental pension benefit
equal to a $350,000 lifetime
annuity, with such actuarially
equivalent alternative forms of
benefit, such as joint and survivor
annuities, but excluding lump sum,
as permitted under and as
calculated under the Primerica
Corporation Supplemental Retirement
Plan (as amended from time to
time), (y) any stock options held
by Weill as of the date of such
Retirement shall be treated in
accordance with their terms
(including, without limitation, the
terms specified in Section 4(d)
above) and (z) any shares of
restricted stock held by Weill as
of the date of such Retirement
shall be governed by the Company's
plan(s) under which such stock was
granted, as then applicable.
(vii) Weill shall not be obligated to
mitigate any payments due from the
Company under this Agreement or any
damages he may suffer as a result
of a breach or termination of this
Agreement by the Company, and there
shall be no set-off to any of the
Company's obligations of payment
under this Agreement for any reason
whatsoever.
6. CONSULTING.
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(a) Consulting. Weill agrees that for a period
of ten years following his Retirement
(unless such period is extended by the
parties hereto, or shortened by Weill's
death, his total and permanent inability to
provide the services set forth in this
Section 6(a) or his breach of any of the
covenants set forth in Section 7(a) below)
(such period, as may be so extended or
shortened, the "CONSULTING TERM"), when and
as requested by the Chief Executive Officer
of the Company and subject to his reasonable
availability, he shall provide consulting
services and advice to the Company and shall
participate in external activities and
events for the benefit of the Company for up
to 45 days per year.
(b) Fees and Expenses. In return for Weill's
willingness to continue to help create value
for the Company's shareholders during his
Retirement, and in return for the foregoing
commitments by Weill, the Company shall pay
Weill, for consulting services performed and
for participation in external activities or
events at the request of the Chief Executive
Officer of the Company, a daily fee, for the
days Weill so renders services, equal to his
daily salary rate at the time of his
Retirement. The Company shall also reimburse
Weill, upon the receipt of appropriate
documentation, for reasonable expenses which
he incurs in providing such services at the
request of the Chief Executive Officer.
7. COVENANTS.
(a) Covenants. Commencing upon Retirement and
for the remainder of his life, Weill agrees
to the following covenants:
(i) Not to engage in any business in
which the Company or its affiliates
is engaged (including by performing
services for or soliciting to
perform services for, directly or
indirectly, either personally or as
an employee, agent, partner,
service member, stockholder,
investor, officer or director of,
or consultant to, any entity or
person) and not to otherwise engage
in conduct that is in material
competition with the Company or its
affiliates; IT BEING UNDERSTOOD
that for purposes of this Section
7(a)(i), Weill shall not be deemed
to be (x) engaged in the investment
management business or to be in
material competition with the
Company to the extent that he
manages assets, directly or
indirectly, for charitable or civic
causes, for himself and/or for a DE
MINIMIS number of family members
and personal friends; or (y) a
stockholder or investor in a
competing entity if his record and
beneficial ownership amount to not
more than 1% of the outstanding
capital stock of any company
subject to the periodic and other
reporting requirements of the
Securities Exchange Act of 1934, as
amended;
(ii) Not to, directly or indirectly, (x)
hire or attempt to hire or induce
any employee, agent, insurance
agent, insurance broker,
broker-dealer of the Company or it
affiliates to be employed or
perform services elsewhere (or
solicit to perform services
elsewhere) or (y) solicit the trade
of any current or prospective
customer or supplier of the Company
or its affiliates;
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(iii) Not to engage in conduct that is
materially injurious to the Company
or its affiliates, monetarily or
otherwise;
(iv) Not to disclose or misuse any
confidential information pertaining
to the Company or its affiliates,
except as is required to be
disclosed by Weill (x) pursuant to
judicial process, (y) to any
government or agency or department
of any government or (z) pursuant
to applicable law;
(v) Not to disparage the Company or its
affiliates or any of their
respective officers or directors,
products or services; and
(vi) To reasonably assist and cooperate
with the Company or its affiliates
in connection with the defense or
prosecution of any claim that may
be made against or by the Company
or its affiliates, or in connection
with any ongoing or future
investigation or dispute or claim
of any kind involving the Company
or its affiliates (including
through the appearance at any
reasonably necessary proceeding or
the execution of any reasonably
necessary document), to the extent
such claims, investigations or
proceedings relate to services
performed or required to be
performed by Weill, pertinent
knowledge possessed by Weill, or
any act or omission by Weill;
PROVIDED, HOWEVER, that a departure from any
of the foregoing covenants where such
departure is inadvertent and isolated and is
promptly cured upon written notice (if such
departure is susceptible to cure) shall not
constitute a breach of such covenant for
purposes of this Agreement.
(b) Effect of a Breach.
(i) If it is determined that Weill has
breached any covenant set forth in
Section 7(a) above, then, in
addition to any right or remedy
that the Company has available
under any plan or other
compensation arrangement that is
applicable to Weill, Weill shall
(x) forfeit his remaining
supplemental pension benefit as
described in Section 5(b)(vi)
above; (y) forfeit the right to the
further continued exercise of stock
options as described in Section
4(d)(y) above; and (z) forfeit any
further perquisites as described in
Section 7(e) below.
(ii) In addition, the Company shall have
available, in addition to any other
right or remedy available, the
right to obtain an injunction from
any court of competent jurisdiction
restraining such breach and to
specific performance of such
covenant, except with respect to
any covenant as to which Weill may
and does "opt out" (as provided in
Section 7(c) below). Weill further
agrees that no bond or other
security will be required in
obtaining such equitable relief,
and he hereby consents to the
issuance of such injunction and to
the ordering of specific
performance; PROVIDED, HOWEVER,
that such consent shall neither
limit the right of Weill to contest
the validity or propriety of any
such determination nor create any
presumption that he has, in fact,
breached such covenant.
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(c) "Opt-Out". After the expiration of ten years
following Retirement, Weill may (in writing
or by his actions) effectively "opt out" of
the covenants set forth in Sections 7(a)(i),
7(a)(ii) or 7(a)(iii) above (for the
avoidance of doubt, any such "opting out"
shall not apply to any of the covenants set
forth in Sections 7(a)(iv), 7(a)(v) or
7(a)(vi) above). Any such "opt out" shall be
treated as if it were a breach for purposes
of Section 7(b) above. Determination that
Weill has, by his actions, "opted out" and
therefore breached any of the covenants set
forth in Section 7(a) above may only be made
in accordance with Section 7(d) below.
(d) Determination of a Breach. For purposes of
Sections 7(b)(i) and 7(c) above,
determination that a breach of any of the
covenants set forth in Section 7(a) above
has occurred may only be made (x) by the
Board of Directors of the Company and (y)
after appropriate due process is afforded to
Weill.
(e) Continued Perquisites. In consideration of
and subject to Weill's compliance with his
commitments set forth in Section 6(a) above
and with the covenants set forth in Section
7(a) above, commencing upon Retirement and
for the remainder of his life, Weill shall
have access to and use of each of the
following Company facilities and services
comparable to those provided to him prior to
his Retirement, on the same basis as such
facilities and services were provided to him
prior to his Retirement: Company aircraft,
car and driver, office (in a location
reasonably selected by the Board of
Directors of the Company) and secretary and
security arrangements. The Company's
obligations set forth in this Section 7(e)
shall apply irrespective of Weill's
incapacitation subsequent to his Retirement
to perform services under this Agreement.
8. MISCELLANEOUS.
(a) Amendment; Entire Agreement. Except as may
be explicitly provided for in any other
agreement between the Company and Weill
which specifically references this Agreement
and explicitly expresses an intention to
amend, supplement or clarify this Agreement,
this Agreement constitutes the entire
understanding between the parties to this
Agreement with respect to the subject matter
of this Agreement and supersedes all
previous oral and written negotiations,
commitments, writings and understandings of
the parties hereto with respect to the
matters described in this Agreement.
(b) Governing law. This Agreement shall be
governed by, and construed and enforced in
accordance with, the laws of the state of
Delaware.
(c) Notices. All notices to be delivered
pursuant to the provisions of this Agreement
shall be given by telex or by notice in
writing, hand delivered or sent by
registered or certified mail, to the parties
hereto at the following addresses:
To the Company:
Citigroup Inc.
399 Park Avenue
New York, New York 10043
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Attention: Office of the General Counsel
or to such other address as the Company
shall designate in a written notice to
Weill from time to time; and
To Weill:
Sanford I. Weill
to such address as Weill
shall designate in a
written notice to the
Company from time to time.
All such notices shall be effective upon
delivery to the designated address.
(d) Severability. Each provision of this
Agreement is intended to be severable. If
any term or provision of this Agreement
shall be determined by a court of competent
jurisdiction to be illegal or invalid for
any reason whatsoever then such provision
shall be severed from this Agreement, shall
not affect the validity of the remainder of
this Agreement and shall be replaced by a
provision reflecting, to the extent legally
permissible, the original intent of the
parties hereto.
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IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Employment Agreement as of the day and year first above written.
Agreed and accepted: CITIGROUP INC.
/s/ Sanford I. Weill /s/ Charles O. Prince, III
----------------------------------- -----------------------------------
Sanford I. Weill By: Charles O. Prince, III
Title: Corporate Secretary
WITNESS
/s/ Arthur Zankel
--------------------------------
Arthur Zankel
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