Company Name: Citigroup Inc.
Public Availability Date: February 28, 2002

Document Sections:

INQUIRY LETTER
APPENDIX 1
APPENDIX 2
APPENDIX 3
APPENDIX 4
STAFF REPLY LETTER

[INQUIRY LETTER]

December 20, 2001

Securities and Exchange Commission

Office of the Chief Counsel

Division of Corporate Finance

450 Fifth Street, N.W.

Washington, D.C. 20549

Re: Stockholder Proposal to Citigroup Inc. of the Ray T. Chevedden and Veronica G. Chevedden Family Trust 050490

Dear Sir or Madam:

Pursuant to Rule 14a-8(d) of the rules and regulations promulgated under the Securities Exchange Act of 1934, as amended (the "Act"), enclosed herewith for filing are six copies of a stockholder proposal and supporting statement submitted by the person listed above for inclusion in the proxy to be furnished to stockholders by Citigroup Inc. in connection with its annual meeting of stockholders to be held on April 16, 2002. Also enclosed for filing are six copies of a statement outlining the reasons Citigroup Inc. deems the omission of the attached stockholder proposal from its proxy statement and form of proxy to be proper pursuant to Rules 14a-8(b) and 14a-8(i)(2) promulgated under the Act and six copies of an opinion of Morris, Nichols, Arsht & Tunnell as to certain matters of Delaware law.

Rule 14a-8(b) provides that in order to be eligible to submit a shareholder proposal pursuant to Rule 14a-8, a proponent must have continuously held at least $2,000 in market value, or 1%, of the company's securities entitled to be voted on the proposal at the meeting for at least one year by the date of submission of the proposal.

Rule 14a-8(i)(2) provides that a proposal may be omitted if the proposal would, if implemented, cause the company to violate any state, federal or foreign law to which it is subject.

By copy of this letter and the enclosed material, Citigroup Inc. is notifying the Proponent of its intention to omit this proposal from its proxy statement and form of proxy. Citigroup Inc. currently plans to file its definitive proxy soliciting material with the Securities and Exchange Commission on or about March 12, 2002.

Kindly acknowledge receipt of this letter and the enclosed material by stamping the enclosed copy of this letter and returning it to me in the enclosed self-addressed, stamped envelope. If you have any comments or questions concerning this matter, please contact me at 212-559-9788 or Shelley J. Dropkin at 212-793-7396.

Very truly yours,

/s/

Michael A. Ross

Deputy General Counsel

Enclosures

cc: John Chevedden

Ray T. Chevedden and Veronica G. Chevedden

Family Trust 050490

[APPENDIX 1]
4SHAREHOLDER VOTE ON POISON PILLS

[This proposal topic is designated by the shareholder and intended for unedited publication in all references, including the ballot. This enhances clarity for shareholders.]

Shareholders request that our Board of Directors seek shareholder approval prior to adopting any poison pill and also redeem or terminate any pill now in effect unless it bas been approved by a shareholder vote at the next shareholder meeting.

The poison pill is an important issue for shareholder vote even if our company does not now have a poison pill or plan to adopt a poison pill in the future. Currently our board can adopt a poison pill and/or redeem a current poison pill and adopt a new poison pill:

1) At any time

2) In a short period of time

3) Without shareholder approval

Negative Effects of Poison Pills on Shareholder Value

A study by the Securities and Exchange Commission found evidence that the negative effect of poison pills to deter profitable takeover bids outweigh benefits.

Source: Office of the Chief Economist, Securities and Exchange Commission. The Effect of Poison Pills on the Wealth of Target Shareholders, October 23, 1986.

Additional Support for this Proposal Topic

Pills adversely effect shareholder value.

Power and Accountability

Nell Mtnow and Robert Monks

Source: www.thecorporatelibrary.com/power

The Council of Institutional Investors www.cii.org/ciicentral/policies.htm & www.cii.org recommends shareholder approval of all poison pills.

Institutional Investor Support for Shareholder Vote

Many institutional investors believe poison pills should be voted on by shareholders. A poison pill can insulate management at the expense of shareholders. A poison pill is such a powerful tool that shareholders should be able to vote on whether it is appropriate. We believe a shareholder vote on poison pills will avoid an unbalanced concentration of power in our directors who could focus on narrow interests at the expense of the vast majority of shareholders.

Institutional Investor Support Is High-Caliber Support

This proposal topic has significant institutional support. Shareholder right to vote on poison pill resolutions achieved a 57% average yes-vote from shareholders at 26 major companies in 2000 (Percentage based on yes-no votes).

Institutional investor support is high-caliber support. Institutional investors have the advantage of a specialized staff and resources, long-term focus, fiduciary duty and independent perspective to thoroughly study the issues involved in this proposal topic.

Shareholder Vote Precedent Set by Other Companies

In recent years, various companies have been willing to redeem poison pills or at least allow shareholders to have a meaningful vote on whether a poison pill should remain in force. We believe that our company should do so as well.

68% Vote at a Major Company

This proposal topic won 68% of the yes-no vote at the Burlington Northern Santa Fe (BNI) 2001 annual meeting. The text of the BNI proposal, which has further information on poison pills, is available at The Corporate Library website:

www.thecorporatelibrary.com

At this URL page:

http://asp.thecorporatelibrary.net/proposals/FullText.asp?Company_ID=10563&Resolution_ID=515&Proxy_Season=2001

In the interest of shareholder value vote yes:

SHAREHOLDER VOTE ON POISON PILLS YES ON 4

The company is requested to insert the correct proposal number based on the dates ballot proposals are initially submitted.

Brackets "[ ]" enclose text not intended for publication.

The above format is intended for unedited publication with company raising in advance any typographical question.

This format contains the emphasis intended.

[APPENDIX 2]
STATEMENT OF INTENT TO OMIT STOCKHOLDER PROPOSAL

Citigroup Inc., a Delaware corporation ("Citigroup" or the "Company"), intends to omit the stockholder proposal and supporting statement (the "Proposal") a copy of which is annexed hereto as Exhibit A, submitted by the Ray T. Chevedden and Veronica G. Chevedden Family Trust 050490 (the "Proponent") for inclusion in its proxy statement and form of proxy (together, the "2002 Proxy Materials") to be distributed to stockholders in connection with the Annual Meeting of Stockholders to be held on April 16, 2002.

The Proposal urges the Company to adopt a resolution requesting that the "Board of Directors seek shareholder approval prior to adopting any poison pill and also redeem or terminate any pill now in effect unless it has been approved by a shareholder vote at the next shareholder meeting."

It is Citigroup's belief that the Proposal may be omitted pursuant to Rule 14a-8(b) and Rule 14a-(8)(i)(2) of the rules and regulations promulgated under the Securities Exchange Act of 1934, as amended. Rule 14a-8(b) provides that in order to be eligible to submit a proposal, a proponent must have "continuously held at least $2,000 in market value, or 1%, of the company's securities entitled to be voted on the proposal at the meeting for at least one year" by the date the proponent submits the proposal. Rule 14a-8(i)(2) provides that a proposal may be omitted if "the proposal would, if implemented, cause the company to violate any state, federal or foreign law to which it is subject."

THE PROPOSAL MAY BE OMITTED BECAUSE THE PROPONENT DID NOT HOLD CITIGROUP SECURITIES FOR THE REQUIRED ONE-YEAR PERIOD PRIOR TO SUBMITTING THE PROPOSAL

Rule 14a-8(b) provides that in order to be eligible to submit a shareholder proposal pursuant to Rule 14a-8, a proponent must have continuously held at least $2,000 in market value, or 1%, of the company's securities entitled to be voted on the proposal at the meeting for at least one year by the date of submission of the proposal (and must continue to hold those securities through the date of the meeting).

On November 30, 2000, Citigroup completed its acquisition (the "Acquisition") of Associates First Capital Corporation ("Associates"). The Acquisition was consummated through the merger (the "Merger") of a subsidiary of Citigroup with and into Associates pursuant to which each share of Associates common stock became the right to receive .7334 of a share of Citigroup common stock. Subsequent to the Acquisition, Associates was contributed to and became a wholly owned subsidiary of Citicorp, a wholly owned subsidiary of Citigroup.

The Proponent became a shareholder of Citigroup common stock on November 30, 2000, when the Proponent's shares of common stock of Associates common stock were exchanged for shares of Citigroup common stock upon consummation of the Merger. The records of Citigroup's transfer agent indicate a certificate for Citigroup shares was issued to the Proponent on December 1, 2000. A copy of the transfer agent's record is attached as Exhibit B.

The Staff (the "Staff") of the Division of Corporation Finance of the Securities and Exchange Commission has consistently granted no-action relief with respect to the omission of a proposal when a proponent has not held voting securities for the requisite period. See, e.g., Exelon Corporation (available March 15, 2001); Applied Power Inc. (available October 4, 1999); Oklahoma Gas and Electric Company (available February 19, 1997); Burlington Northern Santa Fe Corp. (available December 28, 1995); Exide Electronics Group, Inc. (available November 22, 1995); and Owens-Illinois, Inc. (available February 13, 1985).

In each case cited above, the proponent acquired shares of the registrant pursuant to a merger within one year of submitting a proposal to the registrant. Notwithstanding the fact that each proponent had held shares in the acquired company for more than one year prior to the merger, the Staff took the position that each proponent's holding period for the applicable registrant's shares began when such proponent acquired such registrant's shares pursuant to a merger. As the Staff explained in Burlington Northern Santa Fe Corp. "in light of the fact that the transaction in which the proponent acquired these shares appears to constitute a separate sale and purchase of securities for purposes of the federal securities laws, it is the Division's view that the proponent's holding period for the Company's shares did not commence earlier than ..., the effective time of the acquisition."

The transaction pursuant to which the Proponent acquired shares of Citigroup common stock was also an acquisition effected by a merger, and involved a separate sale and purchase of securities for purposes of the federal securities laws. For purposes of Rule 14a-8(b), the Proponent acquired shares of Citigroup common stock on November 30, 2000 when the Merger was consummated. Therefore, at the time Proponent submitted the Proposal (October 1, 2001) the Proponent had not owned Citigroup common stock for the requisite one-year period.

The Company believes that the Proposal may be omitted from its 2002 Proxy Materials in accordance with Rule 14a-8(b) because the Proponent has not satisfied the eligibility requirements of Rule 14a-8(b).

THE PROPOSAL MAY BE OMITTED BECAUSE IT WOULD, IF IMPLEMENTED, CAUSE THE COMPANY TO VIOLATE DELAWARE LAW

The Proposal seeks to have the Board of Directors (i) obtain shareholder approval prior to adopting any poison pill and (ii) redeem or terminate any pill now in effect. As Citigroup does not have a shareholder rights plan in place, the Proposal is, in effect, a vote on whether or not Citigroup's Board should seek shareholder approval prior to adopting a shareholder rights plan. The Board is effectively being asked to defer to shareholders the decision whether it would be appropriate for Citigroup to adopt a shareholder rights plan.

The Proposal may be omitted from the Company's 2002 Proxy Materials because the action that it seeks to have the Board take would constitute an abdication of the Board's duties in violation of Delaware law, which does not permit a board of directors to delegate to shareholders its duty to determine whether to adopt a rights plan. The Proposal may, therefore, be omitted under Rule 14a-8(i)(2), which provides that a proposal which, if implemented, "would require the registrant to violate any ... state law" may be omitted.

The Company is a Delaware corporation. As more fully discussed in the opinion of the Delaware law firm Morris, Nichols, Arsht & Tunnell attached hereto as Exhibit C, parts of which are summarized below, the Proposal, in seeking to permit the shareholders of the Company, and not the Board, to decide whether the Company should have a rights plan, is contrary to Delaware law.

A. The Power and Duty to Determine Whether to Adopt a Shareholder Rights Plan Reside in the Board.

Section 141(a) of the Delaware General Corporation Law, described by the Delaware Supreme Court as the "bedrock of the General Corporation Law," places the responsibility for managing the affairs of a Delaware corporation on its board of directors, not its shareholders:

The business and affairs of every corporation organized under this chapter shall be managed by or under the direction of a board of directors, except as may be otherwise provided in this chapter or in its certificate of incorporation.

8 Del. C. 141(a); Pogostin v. Rice, 480 A.2d 619, 624 (Del. 1984); Paramount Communications, Inc. v. Time, Inc., Del. Ch., C.A. Nos. 10866, 10670, 19835, Allen, C., slip op. at 77-78 (July 4, 1989), aff'd, 571 A.2d 1140 (Del. 1989) ("directors, not shareholders, are charged with the duty to manage the firm").

The Delaware Supreme Court recently reaffirmed, in the strongest terms, that decisions with respect to the adoption of a rights plan are solely for the board to determine, and not for shareholders. Leonard Loventhal Account v. Hilton Hotels Corp., Del. Supr., No. 584, 2000, Walsh, J., slip op. at 9 (Sept. 6, 2001). A board's authority and duty under Section 141(a) include the authority and duty to decide whether a rights plan should be adopted. Hilton Hotels, supra; Quickturn Design Systems, Inc. v. Shapiro, 721 A.2d 1281 (Del. 1998); Moran v. Household Int'l, Inc., 500 A.2d 1346 (Del. 1985). The Proposal would improperly supplant the Board's judgment on this matter with a shareholder referendum.

B. Limitations on the Power and Duty of the Board to Decide Whether to Adopt A Shareholder Rights Plan Are Impermissible.

In Quickturn, the Delaware Supreme Court struck down a "delayed redemption" provision of a rights plan because that provision limited the board's absolute discretion to determine whether to keep the plan in place or to eliminate it by redeeming rights. More recently, in Hilton Hotels, the Delaware Supreme Court made clear that shareholders cannot overrule a board's decision to have a rights plan.

The decisions of the Delaware Supreme Court in Quickturn and Hilton Hotels are consistent with, and premised upon, fundamental principles of Delaware law regarding directors' duties with respect to shareholder rights plans and anti-takeover measures in general developed by the Court over the years. The Court has said that a limitation on the board's authority with respect to such measures "impermissibly circumscribes the board's statutory power under Section 141(a) and the directors' ability to fulfill their concomitant fiduciary duties." Quickturn, 721 A.2d at 1292 (emphasis added). In its landmark Unocal decision, the Delaware Supreme Court emphasized that a board has "both the power and the duty" to erect and maintain defenses if the board determines, in exercising its independent judgment in accordance with its fiduciary duties, that doing so is in the best interests of the shareholders. Unocal Corp. v. Mesa Petroleum Co., 493 A.2d 946, 949 (Del. 1985). Indeed, the board's "power and duty" to protect the corporation is the cornerstone of the Delaware Supreme Court's decision in the Moran case where the Court first upheld the validity of rights plans. The Court there made clear that a board is subject to the same unremitting fiduciary obligation whether considering the adoption of a rights plan or the redemption of rights. Only the board has the power, and the concomitant duty, to make such decisions.

C. The Duty of the Board to Determine Whether to Adopt a Rights Plan Cannot Be Delegated to the Shareholders.

The fundamental power and duty of directors to decide whether to adopt a rights plan cannot be delegated to the shareholders, as the Proposal requests. Such an abdication of directorial responsibility would "violate[] the duty of each director to exercise his own best judgment on matters coming before the board." Abercrombie v. Davies, 123 A.2d 893, 899 (Del. Ch. 1956), rev'd on other grounds, 130 A.2d 338 (Del. 1957) (quoted in Quickturn, 721 A.2d at 1292).

The fact that shareholders do not have the ability to control a board's decisions with respect to a rights plan does not, of course, leave shareholders powerless. Under Delaware corporation law their ultimate power is exercised at the ballot box, where they can vote out directors whose view of protecting the corporation differs from their own:

If the stockholders are displeased with the action of their elected representatives, the powers of corporate democracy are at their disposal to turn the board out.

Unocal, 493 A.2d at 958. That shareholders can vote out directors for making decisions with which they disagree does not, however, permit shareholders to dictate those decisions in the first place, as the authorities discussed above demonstrate. Similarly, and as those same authorities demonstrate, the directors may not abdicate their decision-making responsibility by simply deciding to take instructions from a shareholder majority. Instead, directors have a statutory and fiduciary duty to make their own, independent decision on a matter such as whether to adopt a rights plan.

The Proposal seeks to permit the shareholders of the Company, and not the Board, to decide whether the Company should have a rights plan in violation of Delaware law as articulated by the Delaware Supreme Court.

The Staff has repeatedly permitted companies to exclude proposals that advocate actions that would violate applicable law. See, e.g., Ford Motor Co. (March 19, 2001) (proposal calling for some directors to be drawn by a lottery among holders of common stock and for remainder of directors to be elected by holders of class B stock violated Delaware law and was excludable pursuant to Rule 14a-8(i)(2)); General Dynamics Corp. (March 5, 2001) (proposal to adopt bylaw prohibiting adoption of a shareholder rights plan without prior shareholder approval violated Delaware law and was excludable pursuant to Rule 14a-8(i)(2)); Boeing Co. (March 4, 1999) (proposal to amend bylaws to provide that all issues submitted to a shareholder vote be decided by a simple majority violated Delaware law and was excludable pursuant to Rule 14a-8(i)(2)). Accordingly, the Company believes that it may exclude the Proposal from its 2002 Proxy Materials pursuant to Rule 14a-8(i)(2)).

In Northwest Airlines Corporation, (February 5, 2001), the SEC staff rejected a no-action request regarding a proposal requesting that a shareholder vote be required to adopt or maintain a shareholder rights plan. It appears that Northwest Airlines only sought to exclude the proposal under Rule 14a-8(i)(1) and not Rule 14a-8(i)(2). As the Proposal seeks to have the Board take action that would, if implemented, violate Delaware law, the position taken by the SEC staff with respect to Northwest Airlines no-action request should not be binding with respect to the Proposal.

As the Proposal would permit the shareholders of the Company, and not the Board, to decide whether the Company should have a rights plan, the Proposal, if implemented, would cause Citigroup to violate Delaware law. As such the Proposal may be omitted pursuant to Rule 14a-8(i)(2).

CONCLUSION

For the foregoing reasons, Citigroup respectfully submits the Proponent did not own shares of Citigroup common stock for the requisite one-year period and, in addition, the Proposal would, if implemented, cause Citigroup to violate Delaware law. The Proposal may be omitted pursuant to either Rule 14a-8(b) or Rule 14a-8(i)(2).

[APPENDIX 3]
Exhibit A

5965 S. Citrus Ave.

Los Angeles, CA 90043

PH: 212/559-1000

FX: 212/816-8913

Email: investorrelations@citi.com

Mr. Sanford Weill

Chairman

Citigroup Inc. (C)

399 Park Avenue

New York, NY 10043

Dear Mr. Weill, Chairman and Directors of Citigroup Inc.,

This Rule 14a-8 proposal is respectfully submitted for the 2002 annual shareholder meeting. Rule 14a-8 requirements are intended to continue to be met including ownership of the required stock value through the date of the applicable shareholder meeting. This submitted format, with the shareholder-supplied emphasis, is intended to be used for publication. This is the proxy for Mr. John Chevedden and/or his designee to act on my behalf in shareholder matters, including this shareholder proposal, for the forthcoming shareholder meeting before, during and after the forthcoming shareholder meeting. Please direct all future communication to Mr. John Chevedden at:

PH: 310/371-7872

FX: 310/371-7872

2215 Nelson Ave., No. 205

Redondo Beach, CA 90278

Your consideration and the consideration of the Board of Directors is appreciated.

Sincerely,

/s/

Ray T. Chevedden

Trustee

11-4-01

Date

Ray T. Chevedden and Veronica G. Chevedden Family Trust 050490

Shareholder of Record

Citigroup Inc.

cc:

Charles O. Prince, III

Corporate Secretary

[APPENDIX 4]
January 7, 2002

FX: 202/942-9525

6 Copies

7th copy for date-stamp return

Via UPS Letter

Office of Chief Counsel

Mail Stop 0402

Division of Corporation Finance

Securities and ExchangeCommission

450 Fifth Street, NW

Washington, DC 20549

Citigroup Inc. (C)

Shareholder Response to Company No Action Request

Established Corporate Governance Proposal Topic

Ladies and Gentlemen:

This is respectfully submitted in response to the Citigroup Inc. no action request (NAR). It is believed that Citigroup must meet the burden of proof under rule 14a-8.

The following are believed to be examples of company fallacies, flaws, omissions, inconsistencies and/or lack of valid supporting information:

1) The company description of the exchangeof stock seems to be contradictory and lacking in sufficient detail to be conclusive.

2) Associates apparently became the surviving company in a merger with a subsidiary of Citigroup.

3) There is precedent for an exchangeof stock having no impact in the determination of the one-year period. For instance General Motors shareholders received Delphi Automotive stock in 1999 and were able to submit Delphi shareholder proposals within 6 months.

4) (Fallacy) The vague "Measures in general developed by the Court over the years," is cited as specific proof.

5) It is not believed that rule 14a-8 encourages proposal exclusion based on key information that the company does submit to the staff, such as distinguishing this from Delphi.

6) The company does not elaborate on how a shareholder vote would interfere with a director's "best judgement."

The opportunity to submit additional supporting material beyond this preliminary submission is requested. If the company submits further material, it is respectfully requested that 5 working days be allowed to respond to the company material.

The opportunity to submit additional shareholder supporting material is requested.

Sincerely,

/s/

John Chevedden

cc: C

Ray T. Chevedden

[STAFF REPLY LETTER]
February 28, 2002

Response of the Office of Chief Counsel Division of Corporation Finance

Re: Citigroup Inc.

Incoming letter dated December 20, 2001

The proposal relates to poison pill plans.

There appears to be some basis for your view that Citigroup may exclude the proposal under rule 14a-8(b), because at the time the proponent submitted the proposal, he did not own for one year 1% or $2,000 in market value of securities entitled to be voted at the meeting, as required by rule 14a-8(b). We note in particular that the proponent acquired shares of Citigroup's voting securities in connection with a plan of merger involving Citigroup. In light of the fact that the transaction in which the proponent acquired these shares appears to constitute a separate sale and purchase of securities for the purposes of the federal securities laws, it is our view that the proponent's holding period for Citigroup shares did not commence earlier than November 30, 2000, the effective time of the merger. Accordingly, we will not recommend enforcement action to the Commission if Citigroup omits the proposal from its proxy materials in reliance on rule 14a-8(b). In reaching this position, we have not found it necessary to address the alternative basis for omission on which Citigroup relies.

Sincerely,

/s/

Grace K. Lee

Attorney-Advisor