Exhibit 1.01
TERMS AGREEMENT
November 22, 2005
Citigroup Funding Inc.
388 Greenwich Street, 38th Floor
New York, New York 10013
Attn: Treasury Capital Markets
Ladies and Gentlemen:
We understand that Citigroup Funding Inc., a Delaware corporation (the “Company”), proposes to issue and sell $45,000,000 aggregate principal amount of its 10.75% Equity Linked Securities (ELKS®) (4,500,000 ELKS) Based Upon American Depositary Receipts Representing the Common Shares of Companhia Vale do Rio Doce Due December 8, 2006 (the “ELKS”). The payments due under the ELKS will be fully and unconditionally guaranteed by Citigroup Inc., a Delaware corporation (the “Guarantor”). Subject to the terms and conditions set forth herein or incorporated by reference herein, Citigroup Global Markets Inc. (the “Underwriter”) offers to purchase 4,500,000 ELKS for an amount equal to $43,987,500 (97.750% of the aggregate principal amount). The Closing Date shall be November 30, 2005 at 9:00 a.m. at the offices of Cleary Gottlieb Steen & Hamilton LLP, One Liberty Plaza, New York, New York 10006.
The ELKS shall have the following terms:
Title: | 10.75% Equity Linked Securities (ELKS®) Based Upon American Depositary Receipts Representing the Common Shares of Companhia Vale do Rio Doce Due December 8, 2006 | |
Maturity: | December 8, 2006 | |
Coupon | Each ELKS will pay a total coupon of $1.1019 in | |
| cash in two separate semi-annual installments payable in part on each of two separate Coupon Payment Dates. The first coupon of $0.5644 will be composed of $0.2435 of interest and a partial payment of an option premium in the amount of $0.3209. The second coupon of $0.5375 will be composed of $0.2319 of interest and a partial payment of an option premium in the amount of $0.3056. | ||
Maturity Payment: | Holders of the ELKS will be entitled to receive at maturity the Maturity Payment (as defined in the Prospectus Supplement dated November 22, 2005 relating to the ELKS) | |
Coupon Payment Dates: | June 8, 2006 and December 8, 2006 | |
Regular Record Dates: | June 1, 2006 and December 1, 2006 | |
Initial Price To Public: | 100% of the principal amount thereof, plus accrued interest from November 30, 2005 to date of payment and delivery | |
Trustee: | The Bank of New York | |
Indenture: | Indenture, dated as of June 1, 2005 | |
All the provisions contained in the document entitled “Citigroup Funding Inc. – Debt Securities - Underwriting Agreement Basic Provisions” and dated May 3, 2005 (the “Basic Provisions”), a copy of which you have previously received, are herein incorporated by reference in their entirety and shall be deemed to be a part of this Terms Agreement to the same extent as if the Basic Provisions had been set forth in full herein. Terms defined in the Basic Provisions are used herein as therein defined.
The Underwriter hereby agrees in connection with the underwriting of the ELKS to comply with the requirements set forth in any applicable sections of Section 2720 to the By-Laws of the National Association of Securities Dealers, Inc.
Michael S. Zuckert, Esq., is General Counsel, Finance and Capital Markets of the Guarantor and legal counsel to the Company. Cleary Gottlieb Steen & Hamilton
LLP is counsel to the Underwriter. Cleary Gottlieb Steen & Hamilton LLP is special tax counsel to the Company and the Guarantor.
Please accept this offer no later than 9:00 p.m. on November 22, 2005, by signing a copy of this Terms Agreement in the space set forth below and returning the signed copy to us, or by sending us a written acceptance in the following form:
“We hereby accept your offer, set forth in the Terms Agreement, dated November 22, 2005, to purchase the ELKS on the terms set forth therein.”
Very truly yours, | ||
CITIGROUP GLOBAL MARKETS INC. | ||
By: | /s/ Richard T. Chang | |
Name: | Richard T. Chang | |
Title: | Director | |
ACCEPTED: | ||
CITIGROUP FUNDING INC. | ||
By: | /s/ Geoffrey S. Richards | |
Name: | Geoffrey S. Richards | |
Title: | Vice President and Assistant Treasurer | |
CITIGROUP INC. | ||
By: | /s/ Charles E. Wainhouse | |
Name: | Charles E. Wainhouse | |
Title: | Assistant Treasurer | |
