[CONFORMED COPY]

SUPREME COURT OF THE STATE OF NEW YORK

NEW YORK COUNTY

CITIGROUP INC.,
Plaintiff,

v. Index No.
WACHOVIA CORPORATION, WELLS
FARGO & CO., ROBERT STEEL, JOHN
D. BAKER, II, PETER C. BROWNING,
JOHN T. CASTEEN, III, JERRY GITT,
WILLIAM H. GOODWIN, JR.,
MARYELLEN C. HERRINGER,
ROBERT A. INGRAM, DONALD M.
JAMES, MACKEY J. MCDONALD,
JOSEPH NEUBAUER, TIMOTHY D.
PROCTOR, ERNEST S. RADY, VAN L.
RICHEY, RUTH G. SHAW, LANTY L.
SMITH, DONA DAVIS YOUNG, JOHN
S. CHEN, LLOYD H. DEAN, SUSAN E.
ENGEL, ENRIQUE HERNANDEZ, JR.,
RICHARD M. KOVACEVICH,
RICHARD D. MCCORMICK, CYNTHIA
H. MILLIGAN, NICHOLAS G. MOORE,
PHILIP J. QUIGLEY, DONALD B. RICE,
JUDITH M. RUNSTAD, STEPHEN W.
SANGER, JOHN G. STUMPF, SUSAN G.
SWENSON, MICHAEL W. WRIGHT, and
JOHN DOES 1-99
Defendants.

PLAINTIFF’S MEMORANDUM OF LAW IN SUPPORT

OF MOTION FOR TEMPORARY RESTRAINING ORDER,
PRELIMINARY INJUNCTION, AND EXPEDITED DISCOVERY

GREGORY P. JOSEPH LAW OFFICES

LLC
485 Lexington Avenue, 30th Floor
New York, New York 10017
(212) 407-1200

Attorneys for Citigroup, Inc.

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TABLE OF CONTENTS

PAGE

PRELIMINARY STATEMENT .................................................................................. 1

The Factual Background ................................................................................... 1

Injunctive Relief Is Appropriate ....................................................................... 2

STATEMENT OF FACTS............................................................................................ 3

ARGUMENT................................................................................................................. 3

I. CITIGROUP IS ENTITLED TO INJUNCTIVE RELIEF.............................. 3

A. Citigroup Has Demonstrated A Likelihood of Success on the Merits........ 4

Wachovia Is In Breach of the Exclusivity Agreement............................... 4

B. Citigroup Will Be Irreparably Harmed Without Injunctive Relief............. 5

C. The Balance of the Equities Overwhelmingly Favors Citigroup................ 5

II. AN ORDER FOR EXPEDITED DISCOVERY IS NEEDED TO AVOID

FURTHER HARM TO CITIGROUP .............................................................. 5

CONCLUSION ............................................................................................................. 6
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Plaintiff Citigroup, Inc. (“Citigroup”) respectfully submits this Memorandum of

Law in support of its motion for an order, pursuant to Section 6301 et seq. of the Civil

Practice Law and Rules of the State of New York (“CPLR”), temporarily restraining and

preliminarily enjoining Defendant Wachovia Corporation (“Wachovia”), its subsidiaries

and affiliates, agents, and any persons working on their behalf or in concert with them,

from (i) negotiating, entering into, or consummating any transaction involving any

acquisition of, or merger with, Wachovia; (ii) engaging in any other conduct in

furtherance of any such transaction; or (iii) any other conduct prohibited by the

Exclusivity Agreement. Citigroup has alleged that Defendant Wachovia is in material

breach of the terms of the Exclusivity Agreement it entered into with Citigroup in

connection with Citigroup’s agreement to purchase the banking operations of Wachovia

and that Defendant Wells Fargo & Co. (“Wells Fargo”), with full knowledge of

Citigroup’s agreement with Wachovia, has tortiously interfered with that agreement.

Citigroup also moves for expedited discovery.

PRELIMINARY STATEMENT

The Factual Background

On September 29, 2008 Citigroup and Wachovia signed a term sheet for a

proposed transaction by which Citigroup would buy the banking operations of Wachovia

for approximately $2.1 billion plus the assumption of approximately $180 billion of

secured and unsecured Wachovia debt. On that date, Citigroup and Wachovia also

entered into a binding exclusivity agreement (the “Exlusivity Agreement”).

Under the Exclusivity Agreement, Wachovia is and was expressly forbidden from,

among other things, entering into any negotiations or agreements concerning the
acquisition of Wachovia or its assets with anyone other than Citigroup until October 6,

2008. Evidencing a direct violation of Citigroup’s contractual rights, however, at

approximately 3:00 a.m. on October 3, 2008, Wachovia’s Chief Executive Officer,

Robert Steel, and its counsel, Rodign Cohen of Sullivan & Cromwell, advised Citigroup

that it had entered into a competing acquisition agreement with Wells Fargo. The

negotiation, execution or consummation of any transaction between Wachovia and Wells

Fargo constitutes a clear breach of the Exclusivity Agreement by Wachovia.

The Exclusivity Agreement contains an acknowledgment by the parties

that the parties would be irreparably harmed by any breach of its terms, and each party

agreed that the remedy of specific performance is appropriate in any action in court, in

addition to any other remedy by which such party may be entitled.

Injunctive Relief Is Appropriate

Citigroup satisfies the three prerequisites for obtaining a preliminary injunction.

First, Citigroup can demonstrate a likelihood of success on the merits of its claims. The

negotiation, execution or consummation of a any transaction with Wells Fargo is a clear

violation of the terms of the Exclusivity Agreement. Further, Wells Fargo’s participation

with Wachovia in the scheme to violate Citigroup’s Exclusivity Agreement with

Wachovia constitutes tortious interference.

Second, Citigroup will be irreparably harmed in the absence of a preliminary

injunction. The assets Citigroup was to acquire from Wachovia cannot be purchased at

any price elsewhere in the market and Citigroup’s opportunity to acquire those assets will

be forever lost if the Wells Fargo transaction is not restrained and enjoined.

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 Third, the balance of equities overwhelmingly favors Citigroup and its request for

a preliminary injunction. Citigroup should have an opportunity to prove its claims before

it is too late. Furthermore, Defendants are not injured by any delay required to resolve

this dispute. In addition, there is no justification in equity to reward Wachovia for its

knowing violation of Citigroup’s contractual rights.

Accordingly, the Court should grant Citigroup’s motion for a preliminary

injunction, and, for the same reasons, should grant its motion for a temporary restraining

order until it can be heard. Additionally, in order to achieve a prompt resolution of this

matter, the Court should grant Citigroup’s motion for expedited discovery so that the

precise facts regarding Wachovia’s and Wells Fargo’s violation of the terms of the

Exclusivity Agreement can be explored as quickly as possible to ensure a speedy

resolution of this dispute.

STATEMENT OF FACTS

Rather than repeating them here, Citigroup refers to the facts set forth in the

Emergency Affirmation of Gregory P. Joseph, dated October 3, 2008 (“Joseph Aff.”),

and incorporate them here as if fully set forth herein.

ARGUMENT

I. CITIGROUP IS ENTITLED TO INJUNCTIVE RELIEF

It is well-established that a temporary restraining order and a preliminary

injunction should be issued where a party can demonstrate (a) a likelihood of success on

the merits, (b) irreparable harm, and (c) a balancing of the equities in its favor. Pantel v.

Workmen’s Circle, 289 A.D.2d 917, 918, 735 N.Y.S.2d 228, 231 (3d Dep’t 2001); In re

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AEP Res. Servs. Co., 179 Misc. 2d 639, 650, 686 N.Y.S.2d 664, 670 (Sup. Ct. N.Y. Cty.

1999). All three factors support granting Citigroup injunctive relief.

A. Citigroup Has Demonstrated A Likelihood of Success on the Merits

Wachovia Is In Breach of the Exclusivity Agreement

The Exclusivity Agreement provides that Wachovia is expressly forbidden from,

among other things, (i) “enter[ing] into or participate in any discussions or negotiations

with, furnish any information relating to Wachovia …[or] otherwise cooperate in any

way with, or knowingly assist, participate in, facilitate, or encourage any effort by, any

third party that is seeking to make, or has made, an Acquisition Proposal”; or (ii)

“enter[ing] into any agreement in principal, letter of intent, term sheet, merger agreement,

acquisition agreement, option agreement or other similar instrument relating to an

Acquisition Proposal.” (Joseph Aff. ¶7) The Exclusivity Agreement defines

“Acquisition Proposal” broadly to include “any acquisition or purchase, direct or

indirect” of 15% or more of the consolidated assets or any class of equity or voting

securities of Wachovia; any merger, consolidation, business combination or similar

transaction involving Wachovia; or any other transaction “the consummation which could

reasonably be expected to impede, interfere with, prevent or materially delay the

Citigroup/Wachovia transaction or that could reasonably be expected to dilute materially

the benefits to Citigroup of the transaction.” (Id. ¶ 8.)

Wachovia’s negotiation, and apparent execution of, an agreement with Wells

Fargo is a clear violation of the terms of the Exclusivity Agreement.

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 B. Citigroup Will Be Irreparably Harmed Without Injunctive Relief

As set forth above, and as acknowledged by Wachovia in the Exclusivity

Agreement, Citigroup will be immediately and irreparably harmed without injunctive

relief. The assets Citigroup was to acquire from Wachovia cannot be purchased at any

price elsewhere in the market. Without injunctive relief, Citibank will forever lose this

unique opportunity to acquire those assets.

C. The Balance of the Equities Overwhelmingly Favors Citigroup

Temporarily restraining the Defendants from proceeding further with any

negotiations or the consummation of any agreement will not cause any harm to the

Defendants. Indeed, Defendants had no right to enter into negotiations or agreements

prior to October 6, 2008. Wachovia cannot be rewarded for its violation of Citigroup’s

contractual rights.

II. AN ORDER FOR EXPEDITED DISCOVERY IS NEEDED TO AVOID

FURTHER HARM TO CITIGROUP

A prompt resolution of this matter is required for the benefit of all parties. It is

likely that all parties will seek the most expedited resolution to this matter as possible, for

which expedited discovery is a necessary prerequisite. Accordingly, expedited discovery

into Defendants’ negotiation and execution of an agreement in violation of the terms of

the Exclusivity Agreement is appropriate here.

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 CONCLUSION

For the reasons set forth above, Plaintiff Citigroup respectfully requests that this

Court grant the relief requested in the accompanying Order To Show Cause, together

with such other and further relief as this Court deems just and proper.

Dated: New York, New York

October 3, 2008

GREGORY P. JOSEPH LAW OFFICES LLC

By: _/s/____________________________
Gregory P. Joseph

Douglas J. Pepe
Pamela Jarvis
Of Counsel

485 Lexington Avenue, 30th Floor

New York, New York 10017
(212) 407-1200

Attorneys for Citigroup, Inc.