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This excerpt taken from the C 8-K filed Jan 16, 2009. Joint
Venture”), and Morgan Stanley will contribute its global wealth
management and private wealth management businesses on a worldwide basis into
the Joint Venture. Following
the respective contributions to the Joint Venture and a cash payment of $2.7
billion from Morgan Stanley to Citi in exchange for a portion of the Joint
Venture interests held by Citi, Citi will own a 49% interest in the Joint
Venture and Morgan Stanley will own a 51% interest in the Joint Venture.
Citi will retain the retail brokers employed in Citi bank
branches.
Joint
Venture Contribution and Formation Agreement
The
consummation of the transactions contemplated by the Contribution Agreement is
subject to customary conditions, including the accuracy of each party’s
representations and warranties and the performance of each party’s obligations
under the Contribution Agreement, absence of legal restraints and prohibitions,
expiration or termination of any applicable waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, receipt of applicable
approvals from the
Financial
Industry Regulatory
Authority and the effectiveness of registration of the Joint Venture’s
broker-dealer with the U.S. Securities and Exchange Commission.
Subject to
certain limitations, Citi and Morgan Stanley have agreed to use their respective
reasonable best efforts to do all things necessary, proper or advisable to
consummate the transactions contemplated by the Contribution
Agreement. The Contribution Agreement includes limited
representations and warranties of each party and covenants of each party that
are customary for a transaction of this nature. In addition, each
party has agreed to indemnify the other party and the Joint Venture for losses
arising out of breaches of its representations, warranties and covenants and for
certain excluded liabilities retained by Citi and Morgan Stanley,
respectively. The Contribution Agreement may be terminated under
certain circumstances, including by mutual agreement of Citi and Morgan Stanley,
by either party if the consummation of the transactions contemplated by the
Contribution Agreement has not occurred by March 31, 2010 (subject to a 60-day
extension if necessary for regulatory approval), by either party if an order is
entered prohibiting or disapproving the transaction and the order has become
final and non-appealable, by either party upon a material uncured breach by the
other party that would cause the closing conditions not to be satisfied, or by
either party if the other party undergoes a change of control (or enters into a
definitive agreement with respect to a change of control) within six months of
the date of the Contribution Agreement.
The
foregoing description of the Contribution Agreement does not purport to be
complete and is qualified in its entirety by reference to the Contribution
Agreement, which is filed as Exhibit 10.1 hereto.
Joint
Venture LLC Agreement
Upon the
consummation of the transactions contemplated by the Contribution Agreement, the
parties will enter into an operating agreement for the Joint Venture (the “ |
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