TERMS AGREEMENT September 26, 2005
Exhibit 1.01
September 26, 2005
Citigroup Funding Inc.
000 Xxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Treasury Capital Markets
Ladies and Gentlemen:
We understand that Citigroup Funding Inc., a Delaware corporation (the “Company”), proposes to issue and sell $62,500,000 aggregate principal amount of its 7.75% Equity Linked Securities (ELKS®) (6,250,000 ELKS) Based Upon the Common Stock of The Dow Chemical Company Due October 13, 2006 (the “ELKS”). 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 6,250,000 ELKS in the principal amount of $61,250,000 at 98% of the aggregate principal amount. The Closing Date shall be September 29, 2005 at 9:00 a.m. at the offices of Xxxxxx Xxxxxxxx Xxxxx & Xxxxxxxx LLP, Xxx Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
The ELKS shall have the following terms:
| Title: | 7.75% Equity Linked Securities (ELKS®) Based Upon the Common Stock of The Dow Chemical Company Due October 13, 2006 | |
| Maturity: | October 13, 2006 | |
| Coupon: | Each ELKS will pay a total coupon of $0.8052 in cash in two separate semi-annual installments payable in part on each of two separate Coupon Payment Dates. The first coupon of $0.4155 will be composed of $0.2255 of interest and a partial payment of an option premium in the amount of $0.1900. The second coupon of $0.3897 will be composed of $0.2115 of interest and a partial payment of an option premium in the amount of $0.1782. | |
| Maturity Payment: | Holders of the ELKS will be entitled to receive at maturity the Maturity Payment (as defined in the Prospectus Supplement dated September 26, 2005 relating to the ELKS) | |
| Coupon Payment Dates: | April 12, 2006 and October 13, 2006 | |
| Regular Record Dates: | April 5, 2006 and October 6, 2006 | |
| Initial Price To Public: | 100% of the principal amount thereof, plus accrued interest from September 29, 2005 to date of payment and delivery | |
| Redemption Provisions: | The ELKS are not redeemable by the Company prior to maturity | |
| 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.
Xxxxxxx Xxxxxxx, Esq., is General Counsel, Finance and Capital Matters of the Guarantor and legal counsel to the Company. Xxxxxx Xxxxxxxx Xxxxx & Xxxxxxxx LLP is counsel to the Underwriter. Xxxxxx Xxxxxxxx Xxxxx & Xxxxxxxx LLP is special tax counsel to the Company and the Guarantor.
Please accept this offer no later than 9:00 p.m. on September 26, 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 September 26, 2005, to purchase the ELKS on the terms set forth therein.”
| Very truly yours, | ||
| CITIGROUP GLOBAL MARKETS INC. | ||
| By: | /s/ Xxxxxx X. Xxxxx | |
| Name: | Xxxxxx X. Xxxxx | |
| Title: | Managing Director | |
| ACCEPTED: | ||
| CITIGROUP FUNDING INC. | ||
| By: | /s/ Xxxxxxxx X. Xxxxxxxx | |
| Name: | Xxxxxxxx X. Xxxxxxxx | |
| Title: | Vice President and Assistant Treasurer | |
| CITIGROUP INC. | ||
| By: | /s/ Xxxxxxx X. Xxxxxxxxx | |
| Name: | Xxxxxxx X. Xxxxxxxxx | |
| Title: | Assistant Treasurer | |
