Exhibit 1.01
TERMS AGREEMENT
May 24, 2005
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 $750,000,000 aggregate principal amount of its debt
securities (the "Securities"). Subject to the terms and conditions set forth
herein or incorporated by reference herein, we, Citigroup Global Markets Inc.,
Bear, Xxxxxxx & Co. Inc., Xxxxxxx, Sachs & Co., Xxxxxx Brothers Inc., Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, Barclays Capital Inc., ING Belgium
NV, RBS Securities Corporation, TD Securities (USA) LLC, UBS Securities LLC and
Xxxxxxxx Capital Group, L.L.C., 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
99.228% of the principal amount thereof, plus accrued interest, if any, from the
date of issuance. The Closing Date shall be May 31, 2005, 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: ............................................. 4.700% Fixed Rate Senior Notes Due 2015
Maturity: .......................................... May 29, 2015
Interest Rate: ..................................... 4.700% per annum
Interest Payment Dates: ............................ Semi-annually on May 29 and November 29, commencing
November 29, 2005
Initial Price to Public: ........................... 99.653% of the principal amount thereof, plus
accrued interest, if any, from May 31, 2005
Redemption Provisions: ............................. The Securities are not redeemable by the Company
prior to maturity, except upon the occurrence of certain
events involving United States taxation, as set
forth in the Prospectus Supplement, dated May 24, 2005, to the
Prospectus, dated September 2, 2004
1
Record Date: ....................................... The May 15 or November 15 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 Supplement 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 Supplement. 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 "Primerica
Corporation -- Debt Securities -- Underwriting Agreement -- Basic Provisions"
and dated January 12, 1993 (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 Primerica Corporation shall refer to Citigroup Inc.;
(b) in the second line of Section 2(a), delete "33-55542), including a
prospectus" and insert in lieu thereof "333-117615), including a prospectus"
and any reference in the Basic Provisions to the "Registration Statement"
shall be deemed to be a reference to such registration statement on Form S-3;
(c) in the fourth line of the third paragraph of Section 3, delete the
phrase "certified or official bank check or checks in New York Clearing House
(next day)" and insert in lieu thereof "wire transfer of federal or other
same day";
(d) in the fourteenth line of the third paragraph of Section 3, delete the
word "definitive" and insert in lieu thereof "global";
(e) in the fourth line of the fifth paragraph of Section 3, delete the
phrase "certified or official bank check in New York Clearing House (next
day)" and insert in lieu thereof "wire transfer of federal or other same
day";
(f) in the ninth line of Section 6(a), delete "such registration statement
when it became effective, or in the Registration Statement" and insert in
lieu thereof "the Registration Statement";
(g) in the eighth line of Section 6(b), delete "in any part of such
registration statement when it became effective, or in the Registration
Statement" and insert in lieu thereof "the Registration Statement"; and
(h) in the sixth line of Section 10, delete "65 Xxxx 00xx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000" and insert in lieu thereof "399 Xxxx Xxxxxx, Xxx Xxxx,
Xxx Xxxx 00000".
2
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 Company further agrees and hereby represents that it has been informed
of the guidance relating to stabilization provided by the Financial Services
Authority, in particular in the section MAR 2 Annex 2G of the Financial Services
Handbook, and has not taken or omitted to take any action and will not take any
action or omit to take any action (such as issuing any press release relating to
any Securities without the Stabilization/FSA legend) which may result in the
loss by any of the Underwriters of the ability to rely on any stabilization safe
harbor provided by the Financial Services Authority under the Financial Services
and Markets Xxx 0000.
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.
Each Underwriter further agrees and hereby represents that:
(a) it has not offered or sold and, prior to the expiration of the period
of six months from the Closing Date for the issuance of the Securities, will
not offer or sell any Securities to persons in the United Kingdom, except to
those persons whose ordinary activities involve them in acquiring, holding,
managing or disposing of investments, as principal or agent, for the purposes
of their businesses or otherwise in circumstances which have not resulted and
will not result in an offer to the public in the United Kingdom for purposes
of the Public Offers of Securities Regulations 1995;
(b) it has complied and will comply with all applicable provisions of the
Financial Services and Markets Xxx 0000 ("FSMA") with respect to anything
done by it in relation to the Securities in, from or otherwise involving the
United Kingdom;
(c) 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 FSMA) received by
it in connection
3
with the issue or sale of the Securities in circumstances in which Section
21(1) of FSMA does not apply the Company;
(d) 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;
(e) it is aware of the fact that no German selling prospectus
(Verkaufsprospekt) has been or will be published in respect of the sale of
the Securities and that it will comply with the Securities Selling Prospectus
Act (the "SSPA") of the Federal Republic of Germany (Wertpapier-
Verkaufsprospektgesetz). In particular, each Underwriter represents that it
has undertaken not to engage in a public offering (offentliche Anbieten) in
the Federal Republic of Germany with respect to any Securities otherwise than
in accordance with the SSPA and any other act replacing or supplementing the
SSPA and all the other applicable laws and regulations;
(f) the Securities are being issued and sold outside the Republic of
France and that it has not offered or sold and will not offer or sell,
directly or indirectly, any Securities to the public in the Republic of
France, and that it has not distributed and will not distribute or cause to
be distributed to the public in the Republic of France the Prospectus
Supplement, the Prospectus or any other offering material relating to the
Securities;
(g) 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; and
(h) it acknowledges that the Securities may not be offered, sold,
transferred or delivered in or from The Netherlands as part of their initial
distribution or at any time thereafter directly or indirectly, other than to
individuals or legal entities (which include, but are not limited to, banks,
brokers, dealers or finance companies which are subject to adequate
supervision), institutional investors, insurance companies, pension funds,
central governments and large public international organizations and large
undertakings (through their treasury department) which are listed on a
sufficiently regulated stock exchange, who or which regularly trade or invest
in securities in the conduct of a business or a profession for their own
account, all within the meaning of the Securities Transactions Supervision
Act 1995 (Wet Toezicht Effectenverkeer 1995).
4
In addition to the legal opinions required by Sections 5(c) and 5(d) 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 Supplement under the heading "United States Federal
Income Tax Considerations for 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.
Xxxx X. Xxx, Esq., General Counsel -- 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 May 24,
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:
5
"We hereby accept your offer, set forth in the Terms Agreement, dated May
24, 2005, 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
6
ANNEX A
NAME OF UNDERWRITER PRINCIPAL AMOUNT OF SECURITIES
-------------------------------------------------- ------------------------------
Citigroup Global Markets Inc. $630,000,000
Bear, Xxxxxxx & Co. Inc. 18,750,000
Xxxxxxx, Xxxxx & Co. 18,750,000
Xxxxxx Brothers Inc. 18,750,000
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated 18,750,000
Barclays Capital Inc. 7,500,000
ING Belgium NV 7,500,000
RBS Securities Corporation 7,500,000
TD Securities (USA) LLC 7,500,000
UBS Securities LLC 7,500,000
Xxxxxxxx Capital Group, L.L.C. 7,500,000
------------
TOTAL $750,000,000
============
7
