Exhibit 1.01
TERMS AGREEMENT
October 16, 2002
Citigroup Inc.
399 Park Avenue
New York, New York 10043
Attention: Treasurer
Ladies and Gentlemen:
We understand that Citigroup Inc., a Delaware corporation (the
"Company"), proposes to issue and sell $1,500,000,000 aggregate principal amount
of its debt securities (the "Securities"). Subject to the terms and conditions
set forth herein or incorporated by reference herein, we, 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 99.875% of the principal amount thereof, plus
accrued interest, if any from October 22, 2002. The Closing Date shall be
October 22, 2002, at 8:30 A.M. at the Corporate Law offices of Citigroup Inc.
located at 425 Park Avenue, New York, New York 10043.
The Securities shall have the following terms:
Title: ...................... Floating Rate Notes due 2004
Maturity: ................... October 22, 2004
Interest Rate: .............. Three-month LIBOR (Telerate) plus 0.15%,
determined as set forth in the Prospectus
Supplement, dated October 16, 2002, to the
Prospectus, dated March 30, 2001.
Interest Payment Dates: ..... Quarterly on the 22nd of January, April, July
and October, commencing January 22nd, 2003.
Initial Price to Public: .... 100.00% of the principal amount thereof, plus
accrued interest, if any, from October 22,
2002.
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 October 16, 2002, to the
Prospectus, dated March 30, 2001.
Record Date: ................ The business day 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"), the Euroclear
System and Clearstream International, or their respective 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 such entities 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 "(333-57364), 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 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 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"
(e) in the fourteenth line of the third paragraph of Section 3,
delete the word "definitive" and insert in lieu thereof "global";
(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
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(h) in the sixth line of Section 10, delete "65 East 55th Street,
New York, New York 10022," and insert in lieu thereof "399 Park Avenue,
New York, New York 10043."
The Company agrees to use its best efforts to have the Securities
approved for listing on the Luxembourg Stock Exchange.
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 notes,
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
that do not constitute an offer to the public in the United Kingdom for
purposes of the Public Offers of Securities Regulations 1995, as amended
(the "Regulations");
(b) it has complied and will comply with all applicable provisions
of the Financial Services and Markets Act 2000 ("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 with the issue or sale of the
notes in circumstances in which Section 21(1) of FSMA does not apply to
Citigroup;
(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 has
undertaken not to engage in 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, in connection with their initial distribution, 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; and
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(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).
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, Meagher & Flom 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.
John R. Dye, Esq., Associate General Counsel of the Company, is
counsel to the Company. Skadden, Arps, Slate, Meagher & Flom LLP is special U.S.
tax counsel to the Company. Dewey Ballantine LLP is counsel to the Underwriters.
Please accept this offer no later than 9:00 p.m. Eastern Time on
October 16, 2002 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 October 16, 2002, to purchase the Securities on the terms set forth
therein."
Very truly yours,
SALOMON SMITH BARNEY INC.
BANC ONE CAPITAL MARKETS, INC.
BEAR, STEARNS & CO. INC.
LEHMAN BROTHERS INC.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
BB&T CAPITAL MARKETS, A DIVISION OF
SCOTT & STRINGFELLOW, INC.
CREDIT LYONNAIS SECURITIES (USA) INC.
GUZMAN & COMPANY
ORMES CAPITAL MARKETS, INC.
THE ROYAL BANK OF SCOTLAND PLC
By: SALOMON SMITH BARNEY INC.
By: /s/ Jeffrey A. Drake
-----------------------------------
Name: Jeffrey A. Drake
Title: Vice President
ACCEPTED:
CITIGROUP INC.
By: /s/ Charles E. Wainhouse
------------------------------
Name: Charles E. Wainhouse
Title: Assistant Treasurer
ANNEX A
NAME OF UNDERWRITER PRINCIPAL AMOUNT OF 2004 NOTES
- ------------------- ------------------------------
Salomon Smith Barney Inc. $1,275,000,000
Banc One Capital Markets, Inc. 37,500,000
Bear, Stearns & Co. Inc. 37,500,000
Lehman Brothers Inc. 37,500,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated 37,500,000
BB&T Capital Markets, a division of Scott &
Stringfellow, Inc. 15,000,000
Credit Lyonnais Securities (USA) Inc. 15,000,000
Guzman & Company 15,000,000
Ormes Capital Markets, Inc. 15,000,000
The Royal Bank of Scotland plc 15,000,000
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TOTAL $1,500,000,000
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