Citigroup Inc.

Prior to 2003, Citigroup options, including options granted since the dateof the merger of Citicorp and Travelers Group, Inc., generally vested at a rateof 20% per year over five years (with the first vesting date occurring 12 to 18months following the grant date) and had 10-year terms. Certain options,mostly granted prior to January 1, 2003 and with 10-year terms, permit anemployee exercising an option under certain conditions to be granted newoptions (reload options) in an amount equal to the number of commonshares used to satisfy the exercise price and the withholding taxes due uponexercise. The reload options are granted for the remaining term of the relatedoriginal option and vest after six months. Reload options may in turn beexercised using the reload method, given certain conditions. An option maynot be exercised using the reload method unless the market price on the dateof exercise is at least 20% greater than the option to purchase.On February 14, 2011, Citigroup granted options exercisable forapproximately 29 million shares of Citi common stock to certain of itsexecutive officers. The options have six-year terms and vest in three equalannual installments beginning on February 14, 2012. The exercise price ofthe options is $4.91, which was the closing price of a share of Citi commonstock on the grant date. On any exercise of the options before the fifthanniversary of the grant date, the shares received on exercise (net of theamount required to pay taxes and the exercise price) are subject to a oneyeartransfer restriction.On April 20, 2010, Citigroup made an option grant to a group ofemployees who were not eligible for the October 29, 2009, broad-based grantdescribed below. The options were awarded with a strike price equal to theNYSE closing price on the trading day immediately preceding the date ofgrant ($4.88). The options vest in three annual installments beginning onOctober 29, 2010. The options have a six-year term.On October 29, 2009, Citigroup made a one-time broad-based optiongrant to employees worldwide. The options have a six-year term, andgenerally vest in three equal installments over three years, beginning onthe first anniversary of the grant date. The options were awarded with astrike price equal to the NYSE closing price on the trading day immediatelypreceding the date of grant ($4.08). The CEO and other employees whose2009 compensation was subject to structures approved by the Special Masterdid not participate in this grant.In January 2009, members of the Management Executive Committeereceived 10% of their awards as performance-priced stock options, with anexercise price that placed the awards significantly “out of the money” onthe date of grant. Half of each executive’s options have an exercise price of$17.85 and half have an exercise price of $10.61. The options were grantedon a day on which Citi’s closing price was $4.53. The options have a 10-yearterm and vest ratably over a four-year period.On January 22, 2008, Vikram Pandit, CEO, was awarded stock options topurchase three million shares of common stock. The options vest 25% peryear beginning on the first anniversary of the grant date and expire on thetenth anniversary of the grant date. One-third of the options have an exerciseprice equal to the NYSE closing price of Citigroup stock on the grant date($24.40), one-third have an exercise price equal to a 25% premium overthe grant-date closing price ($30.50), and one-third have an exercise priceequal to a 50% premium over the grant date closing price ($36.60). The firstinstallment of these options vested on January 22, 2009. These options do nothave a reload feature.From 1997 to 2002, a broad base of employees participated in annualoption grant programs. The options vested over five-year periods, or cliffvested after five years, and had 10-year terms but no reload features. Nogrants have been made under these programs since 2002.188