EXHIBIT 1.01
TERMS AGREEMENT
January 21, 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 $742,600,000 aggregate
principal amount of its Variable Rate Exchangeable Notes Due April 6, 2009
(19,750,000 SynDECS(SM)) (the "Underwritten Securities"). Subject to the terms
and conditions set forth herein or incorporated by reference herein, Citigroup
Global Markets Inc. (the "Underwriter") offers to purchase the Underwritten
Securities at a purchase price of $724,838,430, representing a purchase price of
$36.70068 per SynDECS with a principal amount of $37.60. In addition, the
Underwriter will have an option to purchase, at the same purchase price per
SynDECS as the Underwriter shall pay for the Underwritten Securities, up to
2,962,500 SynDECS (with an aggregate principal amount of up to $111,390,000)
(the "Option Securities" and together with the Underwritten Securities, the
"Securities") to cover over-allotments, if any. The option may be exercised in
whole or in part at any time (but not more than once) on or before the 30th day
after the date hereof upon written or facsimile notice by the Underwriter to the
Company setting forth the number of Option Securities as to which the
Underwriter is exercising the option and the settlement date.
The Closing Date shall be January 28, 2004 at 9:00 a.m. at the offices
of Cleary, Gottlieb, Xxxxx & Xxxxxxxx, Xxx Xxxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000 or such other date and time not later than eight full business days
thereafter as you and we determine.
The Securities shall have the following principal terms, all as more
fully described in the Prospectus Supplement dated January 21, 2004 relating to
the Securities:
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Title: Variable Rate Exchangeable Notes Due April 6, 2009
(SynDECS(SM))
Maturity: April 6, 2009
Public Offering Price: $37.83575 per SynDECS
Coupon: Holders of the SynDECS will receive on each Interest
Payment Date and (with respect to the portion of the
principal amount being exchanged) on the applicable
Settlement Date, interest accrued at a floating rate
equal to LIBOR for the relevant period plus 0.05%.
The interest payment due on any Interest Payment Date
is subject to increase or decrease as described in
the Prospectus Supplement dated January 21, 2004
relating to the Securities.
Interest Payment Dates: May 1, 2004, August 1, 2004, November 1, 2004,
February 1, 2005, May 1, 2005, August 1, 2005,
November 1, 2005, February 1, 2006, May 1, 2006,
August 1, 2006, November 1, 2006, February 1, 2007,
May 1, 2007, August 1, 2007, November 1, 2007,
February 1, 2008, May 1, 2008, August 1, 2008,
November 1, 2008 and February 1, 2009
Regular Record Dates: April 15, 2004, July 15, 2004, October 15, 2004,
January 15, 2005, April 15, 2005, July 15, 2005,
October 15, 2005, January 15, 2006, April 15, 2006,
July 15, 2006, October 15, 2006, January 15, 2007,
April 15, 2007, July 15, 2007, October 15, 2007,
January 15, 2008, April 15, 2008, July 15, 2008,
October 15, 2008 and January 15, 2009
Exchange: On each Settlement Date, the Company will mandatorily
exchange one-third of the original principal amount
of each SynDECS for the Total Exchange Shares (as
defined in the Prospectus Supplement dated January
21, 2004 relating to the Securities).
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Settlement Dates: November 21, 2008, January 29, 2009 and April 6,
2009, subject in each case to extension under certain
circumstances as described in the Prospectus
Supplement dated January 21, 2004 relating to the
Securities.
No Optional Redemption: The Company does not have the option to exchange the
principal amount of the SynDECS or to otherwise repay
the principal of the SynDECS prior to each Settlement
Date.
Mandatory Redemption The Company is required to redeem the then
Provisions: outstanding SynDECS, in whole or in part depending on
the circumstances, upon the occurrence of a Mandatory
Redemption Event or a Partial Mandatory Redemption
Event (each as defined in the Prospectus Supplement
dated January 21, 2004 relating to the Securities)
Trustee: The Bank of New York
Indenture: Indenture, dated as of October 27, 1993, as amended
from time to time
Listing: None
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.
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(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 January 28, 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 prior written consent of
Citigroup Global Markets Inc., offer, sell, contract to offer or sell
or otherwise dispose of any securities, including any backup
undertakings 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 SynDECS or such substantially similar
securities, during the period beginning on the date of the Terms
Agreement and continuing to and including the Closing Date.
Notwithstanding the foregoing, the Company and its affiliates may enter
into hedging transactions relating to the Securities."
(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."
(E) The reference to the file number of the registration statement on Form
S-3 in Paragraph 2(a) of the Basic Provisions is amended and restated
to refer to File No. 333-106272.
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 and will deliver the
opinions called for by Paragraphs 5(c) and 5(d) of the Basic Provisions. Cleary,
Gottlieb, Xxxxx & Xxxxxxxx is counsel to the Underwriter for purposes of
Paragraph 5(e) of the Basic Provisions. Cleary, Gottlieb, Xxxxx & Xxxxxxxx is
special tax counsel to the Company.
Please accept this offer no later than 9:00 p.m. on January 21, 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:
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"We hereby accept your offer, set forth in the Terms Agreement, dated
January 21, 2004, to purchase the Securities on the terms set forth therein."
Very truly yours,
CITIGROUP GLOBAL MARKETS INC.
By: /s/ Xxxxxxx Xxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxx
Title: Managing Director
ACCEPTED:
CITIGROUP GLOBAL MARKETS HOLDINGS INC.
By: /s/ Xxxx X. Xxxxxxxx
----------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Executive Vice President
and Treasurer
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