EXHIBIT 1.01
TERMS AGREEMENT
February 19, 2004
Citigroup Global Markets Holdings Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Treasurer
Dear Sirs:
We understand that Citigroup Global Markets Holdings Inc., a New York
corporation (the "Company"), proposes to issue and sell $405,000,000 aggregate
principal amount of its Enhanced Income Strategy (SM) Principal-Protected Notes
with Income and Appreciation Potential Linked to the 2004-1 Dynamic Portfolio
Index(SM) due February 26, 2009 (the "Notes"). Subject to the terms and
conditions set forth herein or incorporated by reference herein, Citigroup
Global Markets Inc. (the "Underwriter") offers to purchase 40,500,000 Notes in
the principal amount of $405,000,000 at 96.5% of the principal amount. The
Closing Date shall be February 26, 2004 at 9:00 a.m. at the offices of Cleary,
Gottlieb, Xxxxx & Xxxxxxxx, Xxx Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx 00000.
The Notes shall have the following terms:
Title: Enhanced Income Strategy (SM)
Principal-Protected Notes with Income and
Appreciation Potential Linked to the 2004-1
Dynamic Portfolio Index(SM) due February 26,
2009
Maturity: February 26, 2009
Maturity Payment: Holders of the Notes will be entitled to
receive at maturity the Maturity Payment (as
defined in the Prospectus Supplement to be
dated February 19, 2004 relating to the
Notes)
Interest Rate: The interest payable on the Notes will vary
and may
1
be zero. The interest on the Notes
for any quarter will depend on the
allocation of the 2004-1 Dynamic Portfolio
Index to the 2004-1 Income 10 Buy-Write
Index portfolio and on the notional income
on the 2004-1 Income 10 Buy-Write Index (as
described in "Description of the Notes --
Interest" in the Prospectus Supplement to be
dated February 19, 2004 relating to the
Notes). If the amount of the 2004-1 Dynamic
Portfolio Index allocated to the 2004-1
Income 10 Buy-Write Index portfolio falls to
zero at any time during the term of the
Notes, no interest will be paid for the
remaining term of the Notes.
Interest Payment Dates: May 26, 2004, August 26, 2004, November 26,
2004, February 26, 2005, May 26, 2005,
August 26, 2005, November 26, 2005, February
26, 2006, May 26, 2006, August 26, 2006,
November 26, 2006, February 26, 2007, May
26, 2007, August 26, 2007, November 26,
2007, February 26, 2008, May 26, 2008,
August 26, 2008, November 26, 2008, and
February 26, 2009.
Regular Record Dates: May 19, 2004, August 19, 2004, November 19,
2004, February 19, 2005, May 19, 2005,
August 19, 2005, November 19, 2005, February
19, 2006, May 19, 2006, August 19, 2006,
November 19, 2006, February 19, 2007, May
19, 2007, August 19, 2007, November 19,
2007, February 19, 2008, May 19, 2008,
August 19, 2008, November 19, 2008, and
February 19, 2009.
Initial Price To Public: 100% of the principal amount thereof, plus
accrued interest from February 26, 2004 to
date of payment and delivery
Trustee: The Bank of New York
Indenture: Indenture, dated as of October
27, 1993, as amended from time to time
2
All the provisions contained in the document entitled "Xxxxxxx Xxxxx
Xxxxxx Holdings Inc. -- Debt Securities -- Underwriting Agreement Basic
Provisions" and dated December 1, 1997 (the "Basic Provisions"), a copy of which
you have previously received, are, except as indicated below, 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.
Basic Provisions varied with respect to this Terms Agreement:
(A) All references to "Xxxxxxx Xxxxx Barney Holdings Inc." in the Basic
Provisions shall refer to the Company.
(B) Notwithstanding the provisions set forth in Section 3 of the Basic
Provisions, the Company and the Underwriter hereby agree that the
Securities will be in the form of Book-Entry Notes and shall be
delivered on February 26, 2004 against payment of the purchase price to
the Company by wire transfer in immediately available funds to such
accounts with such financial institutions as the Company may direct.
(C) Paragraph 4(j) of the Basic Provisions shall be amended and restated as
follows: "The Company will not, without the consent of Citigroup Global
Markets Inc., offer, sell, contract to offer or sell or otherwise
dispose of any securities, including any backup undertaking for such
securities, of the Company, in each case that are substantially similar
to the Securities or any security convertible into or exchangeable for
the Notes or such substantially similar securities, during the period
beginning the date of the Terms Agreement and ending the Closing Date."
(D) Paragraph 5(g) of the Basic Provisions shall be amended and restated as
follows: "You shall have received on the Closing Date letters from
PricewaterhouseCoopers LLP and KPMG LLP covering the matters set forth
in Exhibit II hereto, with respect to the Registration Statement and
the Prospectus at the time of the Terms Agreement."
The Underwriter hereby agrees in connection with the underwriting of
the Securities 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 counsel to the Company. Cleary, Gottlieb,
Xxxxx & Xxxxxxxx is counsel to the Underwriter. Cleary, Gottlieb, Xxxxx &
Xxxxxxxx is special tax counsel to the Company.
3
Please accept this offer no later than 9:00 p.m. on February 19, 2004,
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
February 19, 2004, to purchase the Notes 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 GLOBAL MARKETS HOLDINGS INC.
By: /s/ Xxxx Xxxxxxxx
---------------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Executive Vice President
and Treasurer
