TERMS
AGREEMENT
Citigroup
Inc.
399 Park
Avenue
New York, New
York 10043
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Attention:
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Assistant
Treasurer
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Ladies and
Gentlemen:
We understand
that Citigroup Inc., a Delaware corporation (the
“Company”), proposes to issue and sell US$750,000,000
aggregate principal amount of its subordinated debt securities (the
“Securities”). Subject to the terms and conditions set
forth herein or incorporated by reference herein, we, Citigroup
Global Markets Inc., Bear, Stearns & Co. Inc., Deutsche Bank
Securities Inc., Goldman, Sachs & Co., Merrill Lynch, Pierce,
Fenner & Smith, Incorporated, Banc of America Securities LLC,
Credit Suisse Securities (USA) LLC, Lehman Brothers Inc., Loop
Capital Markets, LLC, UBS Securities LLC, and The Williams Capital
Group, L.P., 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 99.817% of the principal amount
thereof, plus accrued interest, if any, from and including December
11, 2006 but excluding February 16, 2007. The Securities form a
part of the same series as the Company’s outstanding
Subordinated Floating Rate Notes due 2016, issued on June 9, 2006.
The Closing Date shall be February 16, 2007, at 8:30 A.M. The
closing shall take place at the Corporate Law offices of the
Company located at 425 Park Avenue, New York, New York
10043.
The Securities
shall have the following terms:
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Subordinated
Floating Rate Notes Due 2016
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June 9,
2016
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Three-month
LIBOR (Telerate) plus 0.27% determined as set forth in the
Prospectus dated March 2, 2006 and the Prospectus Supplement dated
February 9, 2007
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Quarterly on
the 9 th day of each March, June, September and December
commencing March 9, 2007
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100.217% of the
principal amount thereof, plus accrued interest from December 11,
2006
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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 dated March 2, 2006
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The business
day immediately preceding each Interest Payment Date
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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 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. Principal and
interest on the Securities shall be payable in United States
dollars. The relevant provisions of Article Eleven of the Indenture
relating to defeasance shall apply to the Securities.
All the provisions contained in the document
entitled “Citigroup Inc.— Debt Securities —
Underwriting Agreement — Basic Provisions” and dated
March 2, 2006 (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 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
listin
