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 “