Exhibit 1.01
TERMS AGREEMENT
June 27, 2006
Citigroup Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Treasurer
Ladies and Gentlemen:
We understand that Citigroup Inc., a Delaware corporation (the "Company"),
proposes to issue and sell $250,000,000 aggregate principal amount of its senior
debt securities (the "Securities"). Subject to the terms and conditions set
forth herein or incorporated by reference herein, we, Citigroup Global Markets
Inc., SBK-Xxxxxx Investment Corp. and Xxxxxxxx Capital Partners, L.P., as
underwriters (the "Underwriters"), offer to purchase, severally and not jointly,
the principal amount of the Securities set forth opposite our respective names
on the list attached as Annex A hereto at 99.6285% of the principal amount
thereof, plus accrued interest from and including May 18, 2006 to but excluding
June 30, 2006. The Securities form a part of the same series as the Company's
outstanding Floating Rate Notes due 2011, issued on May 18, 2006. The Closing
Date shall be June 30, 2006, at 8:30 A.M. The closing shall take place at the
Corporate Law offices of the Company located at 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000.
The Securities shall have the following terms:
Title: ....................... Floating Rate Notes Due 2011
Maturity: .................... May 18, 2011
Interest Rate: ............... Three-month LIBOR (Telerate) plus 0.09%,
determined as set forth in the Prospectus dated
March 2, 2006 and the Prospectus Supplement
dated June 27, 2006
Interest Payment Dates: ...... Quarterly on the 18th day of each February,
May, August and November, commencing August 18,
2006
Initial Price to Public: ..... 99.8785% of the principal amount thereof, plus
accrued interest from May 18, 2006
Redemption Provisions: ....... The Securities are not redeemable by the
Company prior to Maturity, except upon the
1
occurrence of certain events involving United
States taxation, as set forth in the Prospectus
dated March 2, 2006
Record Date: ................. The business day immediately preceding each
Interest Payment Date
Additional Terms:
The Securities shall be issuable as Registered Securities only. The
Securities will be initially represented by one or more global Securities
registered in the name of The Depository Trust Company ("DTC") or its nominees,
as described in the Prospectus relating to the Securities. Beneficial interests
in the Securities will be shown on, and transfers thereof will be effected only
through, records maintained by DTC, Euroclear Bank S.A./N.V., as operator of the
Euroclear System, and Clearstream International and their respective
participants. Owners of beneficial interests in the Securities will be entitled
to physical delivery of Securities in certificated form only under the limited
circumstances described in the Prospectus. Principal and interest on the
Securities shall be payable in United States dollars. The provisions of Sections
11.03 and 11.04 of the Indenture relating to defeasance shall apply to the
Securities.
All the provisions contained in the document entitled "Citigroup Inc.--
Debt Securities -- Underwriting Agreement -- Basic Provisions" and dated March
2, 2006 (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 Company agrees to use its best efforts to have the Securities approved
for listing on the Luxembourg Stock Exchange and to maintain such listing so
long as any of the Securities are outstanding, provided, however that:
(a) if it is impracticable or unduly burdensome, in the good faith
determination of the Company, to maintain such listing due to changes in
listing requirements occurring after the date of the Prospectus Supplement,
or
(b) if the Transparency Directive (as defined in the Prospectus
Supplement) is implemented in Luxembourg in a manner that would require the
Company to publish financial information according to accounting principles
or standards that are materially different from United States generally
accepted accounting principles,
the Company may de-list the Securities from the Luxembourg Stock Exchange and
shall use its reasonable best efforts to obtain an alternative admission to
listing, trading and/or quotation of the Securities by another listing
authority, exchange or system within or outside the European Union as it may
decide. If such an alternative admission is not available or is, in the
Company's opinion, unduly burdensome, such an alternative admission will not be
obtained, and the Company shall have no further obligation in respect of any
listing, trading or quotation for the Securities.
The Underwriters hereby agree in connection with the underwriting of the
Securities to comply with the requirements set forth in any applicable sections
of Rule 2720 of the Conduct Rules of the National Association of Securities
Dealers, Inc.
2
Each Underwriter further agrees and hereby represents that:
(a) it has only communicated or caused to be communicated and it will only
communicate or cause to be communicated an invitation or inducement to engage in
investment activity (within the meaning of Section 21 of the Financial Services
and Markets Act 2000 (the "FSMA") received by it in connection with the issue or
sale of the Securities in circumstances in which Section 21(1) of the FSMA does
not apply to the Company;
(b) it has complied and will comply with all applicable provisions of the
FSMA with respect to anything done by it in relation to the Securities in, from
or otherwise involving the United Kingdom;
(c) it will not offer or sell any Securities directly or indirectly in
Japan or to, or for the benefit of, any Japanese person or to others, for
re-offering or re-sale directly or indirectly in Japan or to any Japanese person
except under circumstances which will result in compliance with all applicable
laws, regulations and guidelines promulgated by the relevant governmental and
regulatory authorities in effect at the relevant time. For purposes of this
paragraph, "Japanese person" means any person resident in Japan, including any
corporation or other entity organized under the laws of Japan;
(d) it is aware of the fact that no securities prospectus
(Wertpapierprospekt) under the German Securities Prospectus Act
(Wertpapierprospektgesetz, the "Prospectus Act") has been or will be published
in respect of the Securities in the Federal Republic of Germany and that it will
comply with the Prospectus Act and all other laws and regulations applicable in
the Federal Republic of Germany governing the issue, offering and sale of the
Securities;
(e) no Securities have been offered or sold and will be offered or sold,
directly or indirectly, to the public in France except to qualified investors
(investisseurs qualifies) and/or to a limited circle of investors (cercle
restreint d'investisseurs) acting for their own account as defined in article L.
411-2 of the French Code Monetaire et Financier and applicable regulations
thereunder; and that the direct or indirect resale to the public in France of
any Securities acquired by any qualified investors (investisseurs qualifies)
and/or any investors belonging to a limited circle of investors (cercle
restreint d'investisseurs) may be made only as provided by articles L. 412-1 and
L. 621-8 of the French Code Monetaire et Financier and applicable regulations
thereunder; and that none of the Prospectus Supplement, the Prospectus or any
other offering materials relating to the Securities has been released, issued or
distributed to the public in France except to qualified investors (investisseurs
qualifies) and/or to a limited circle of investors (cercle restreint
d'investisseurs) mentioned above; and
(f) it and each of its affiliates has not offered or sold, and it will not
offer or sell, the Securities by means of any document to persons in Hong Kong
other than persons whose ordinary business it is to buy or sell shares or
debentures, whether as principal or agent, or otherwise in circumstances which
do not constitute an offer to the public within the meaning of the Hong Kong
Companies Ordinance (Chapter 32 of the Laws of Hong Kong), and unless permitted
to do so under the securities laws of Hong Kong, no person has issued or had in
its possession for the purposes of issue, and will not issue or have in its
possession for the purpose of issue, any advertisement, document or invitation
relating to the Securities other than with respect to the Securities to be
disposed of to persons outside Hong Kong or only to persons whose business
involves the acquisition, disposal or holding of securities, whether as
principal or agent.
3
In addition to the legal opinions required by Sections 6(b) and 6(c) of the
Basic Provisions, the Underwriters shall have received an opinion of Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP, special U.S. tax counsel to the Company, dated
the Closing Date, to the effect that although the discussion set forth in the
Prospectus under the headings "United States Federal Income Tax Considerations -
Introduction" and "- Non-United States Holders" does not purport to discuss all
possible United States federal income tax consequences of the purchase,
ownership and disposition of the Securities to non-United States holders of the
Securities, such discussion constitutes, in all material respects, a fair and
accurate summary of the United States federal income tax consequences of the
purchase, ownership and disposition of the Securities to non-United States
holders of the Securities.
Xxxxxxx X. Xxxxxxx, Esq., General Counsel, Finance and Capital Markets of
the Company, is counsel to the Company. Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
is special U.S. tax counsel to the Company. Xxxxxx Xxxxxxxx Xxxxx & Xxxxxxxx LLP
is counsel to the Underwriters.
Please accept this offer no later than 9:00 p.m. (Eastern Time) on June 27,
2006 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:
4
"We hereby accept your offer, set forth in the Terms Agreement, dated June
27, 2006, to purchase the Securities on the terms set forth therein."
Very truly yours,
CITIGROUP GLOBAL MARKETS INC.,
on behalf of the Underwriters named
herein
By: /s/ Xxxx X. XxXxxxxxx, Xx.
------------------------------------
Name: Xxxx X. XxXxxxxxx, Xx.
Title: Managing Director
ACCEPTED:
CITIGROUP INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
---------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Assistant Treasurer
5
ANNEX A
NAME OF UNDERWRITER PRINCIPAL AMOUNT OF SECURITIES
------------------- ------------------------------
Citigroup Global Markets Inc. $237,500,000
SBK-Bonds Investment Corp. 6,250,000
Xxxxxxxx Capital Partners, L.P. 6,250,000
------------
TOTAL $250,000,000
============
6
