Exhibit 1.01
TERMS AGREEMENT
July 25, 2005
Citigroup Funding Inc.
388 Greenwich Street, 38th Floor
New York, New York 10013
Attn: Treasury Capital Markets
Ladies and Gentlemen:
We understand that Citigroup Funding Inc., a Delaware corporation (the
"Company"), proposes to issue and sell $29,500,000 aggregate principal amount of
its 7% Select EQUity Indexed NoteS(SM) Based Upon the Common Stock of Texas
Instruments Incorporated Due August 11, 2006 (the "SEQUINS"). Payments due under
the SEQUINS 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 2,950,000 SEQUINS in the principal amount
of $28,983,750 at 98.25% of the aggregate principal amount. The Closing Date
shall be July 28, 2005 at 9:00 a.m. at the offices of Cleary Gottlieb Steen &
Hamilton LLP, One Liberty Plaza, New York, New York 10006.
The SEQUINS shall have the following terms:
Title: 7% Select EQUity Indexed NoteS(SM) Based Upon the
Common Stock of Texas Instruments Incorporated Due
August 11, 2006
Maturity: August 11, 2006
Maturity Payment: Holders of the SEQUINS will be entitled to receive at
maturity the Maturity Payment (as defined in the
Prospectus Supplement dated July 25, 2005 relating to
the SEQUINS)
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Interest Rate: 7% per annum
Interest Payment Dates: The 11th day of each February, May, August and
November, or the immediately next Business Day,
commencing on November 14, 2005.
Regular Record Dates: The fifth Business Day preceding each interest
payment date.
Initial Price To Public: 100% of the principal amount thereof, plus accrued
interest from July 28, 2005 to date of payment and
delivery.
Call Option: Beginning January 30, 2006, the Company may call the
SEQUINS in whole, and not in part, for cash in an
amount that, together with all other payments made on
the SEQUINS from the date of issuance to and
including the call date, will provide a yield to call
of 11.25% per annum (compounded annually)
Trustee: The Bank of New York
Indenture: Indenture, dated as of June 1, 2005
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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
SEQUINS 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.
John R. Dye, Esq., is General Counsel -- Capital Markets of the Guarantor
and counsel to the Company. Cleary Gottlieb Steen & Hamilton LLP is counsel to
the Underwriter. Cleary Gottlieb Steen & Hamilton LLP is special tax counsel to
the Company and the Guarantor.
Please accept this offer no later than 9:00 p.m. on July 25, 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:
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"We hereby accept your offer, set forth in the Terms Agreement, dated July
25, 2005, to purchase the SEQUINS on the terms set forth therein."
Very truly yours,
CITIGROUP GLOBAL MARKETS INC.
By: /s/ Ramesh K. Menon
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Name: Ramesh K. Menon
Title: Managing Director
ACCEPTED:
CITIGROUP FUNDING INC.
By: /s/ Scott Freidenrich
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Name: Scott Freidenrich
Title: Executive Vice President
CITIGROUP INC.
By: /s/ Charles E. Wainhouse
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Name: Charles E. Wainhouse
Title: Assistant Treasurer
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