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MLI Growth (MLI 2010 - 20)

CitiFirst Protection

Overview

The MLI is a short term product that offers Investors the potential for growth at Maturity where Investors are able to participate in the positive performance of the Worst Performing Reference Asset (ANZ, BHP, NAB & RIO), subject to a Cap Level, along with the safety of Capital Protection for Investments held at Maturity.

Indicative Terms

  • Offer Open: 26 October 2010
  • Offer Close: 24 November 2010
  • Issue Date: 30 November 2010
  • Maturity: 30 November 2012
  • Currency: AUD
  • Capital Protection
  • Type: Deferred Purchase Agreement
Issuer:

Citigroup Global Markets Australia Pty Limited

Guarantor:

Citigroup Inc.

Reference Assets:

A share in the following Australian companies is a 'Reference Asset' and together they are the "Reference Assets":

  • Australia and New Zealand Banking Group Limited ("ANZ");
  • BHP Billiton Limited ("BHP");
  • National Australia Bank Limited ("NAB"); and
  • Rio Tinto Limited ("RIO").

Investors should note that the risks associated with each Reference Asset are different. Investors should assess whether the risks associated with each Reference Asset are appropriate for them.

Offer Opening Date:

26 October 2010 at 9:00 am (Sydney time)

Offer Closing Date:

24 November 2010 at 5:00 pm (Sydney time)

Issue Date:

30 November 2010

Maturity Date:

30 November 2012

Term:

Two (2) years

Denomination:

Australian dollars (AUD)

Issue Price:

AUD 1.00 per Unit

Investment:

The MLI which is an agreement between the Investor and the Issuer governed by the Terms.

Investment Amount:

The total amount paid in respect of an Investment by the Investor to the Issuer by the Offer Closing Date.

Minimum Investment Amount:

AUD 10,000, with multiples of AUD 1,000 thereafter.

Capital Protection*:

The value of each Unit on the Maturity Date will be no less than the Issue Price (subject to certain restrictions as described in Section 4 of this PDS).

Initial Price:

In respect of each Reference Asset, the 'Initial Price' is the Official Closing Price of the Reference Asset on the Issue Date.

Reference Price:

In respect of each Reference Asset, the 'Reference Price' is the Official Closing Price of the Reference Asset as at the date on which it is observed.

Reference Asset Performance:

In respect of each Reference Asset:

Reference Asset Performance (%) = (Reference Price - Initial Price) / Initial Price

Worst Performing Reference Asset:

The Worst Performing Reference Asset is the Reference Asset with the lowest Reference Asset Performance, as determined by the Issuer on an Observation Date.

Potential returns in the MLI are linked to the Worst Performing Reference Asset on each of the three (3) Observation Dates. Hence, Investors should be aware that their exposure is not based on the average performance of all of the Reference Assets. Accordingly, the negative performance of the Worst Performing Reference Asset will not be offset by the positive performance of another Reference Asset.

Average Worst Performance:

The Average Worst Performance is the sum of the Reference Asset Performance of the Worst Performing Reference Assets on each of the three (3) Observation Dates divided by the number of Observation Dates. This is calculated as follows:

(Reference Asset Performance of the Worst Performing Reference Asset on the first Observation Date + Reference Asset Performance of the Worst Performing Reference Asset on the second Observation Date + Reference Asset Performance of the Worst Performing Reference Asset on the third Observation Date) / 3

Investors should note that the Worst Performing Reference Asset on each Observation Date may be different.

Observation Dates:

30 September 2012, 30 October 2012 and 30 November 2012 (i.e. the Maturity Date).

Cap Level:

The 'Cap Level' is a fixed level which represents the maximum return above the Issue Price that an Investor can receive when the Final Value per Unit is calculated.

The Cap Level will be determined by the Issuer on the Issue Date, but will not be less than 30%. By way of example, if the Units had been issued on 22 October 2010, the Cap Level would have been 36%. The actual Cap Level may, however, be different if there is a change in the factors that affect the Cap Level.

The Cap Level will be notified to the Investor after the Issue Date in the Confirmation.

Investors should refer to the section "What factors affect the Cap Level?" in Section 1 of this PDS for further details.

Final Value per Unit¤:

At Maturity, the Final Value per Unit is calculated as follows:

Issue Price x [100% + Min (Cap Level, Max (0%, Average Worst Performance))]

This means that the Final Value per Unit cannot be less than the Issue Price and that if the Average Worst Performance exceeds 0%, then the Final Value per Unit will be the lesser of:

  • the Issue Price, multiplied by one plus the Average Worst Performance; or
  • the Issue Price, multiplied by one plus the Cap Level.

Investors should refer to Section 1 of this PDS for more information on how the Final Value per Unit is calculated.

Delivery Asset:

Ordinary shares in National Australia Bank Limited ("NAB") (an ASX quoted share, ASX code: NAB).

Risks:

The MLI is subject to investment risks, including the possible loss of the Investment Amount in the event of Early Maturity and possible delays in payment. Investors should be aware of the possibility that the MLI will not generate a return. For information regarding the risks associated with the MLI, please refer to Section 4 of this PDS.

Coupon:

Nil. Investors should note that the MLI does not offer the payment of any coupon amount and only offers payment of a Final Value per Unit at Maturity.

Fees:

Distributor Fee: An upfront fee payable by the Issuer of up to 2.00% (including GST if applicable) of the Investment Amount.

This fee is payable by the Issuer out of its own funds and is not an additional cost to the Applicant, nor is it deducted from the Applicant's Investment Amount.

For more information on what fees and commissions are payable in connection with an investment in the MLI, please refer to Section 6 of this PDS.

* Capital Protection only applies to Investments held at Maturity provided that Early Maturity does not occur. Capital Protection safeguards the MLI from market risks up to the value of the Issue Price, but is subject to the credit worthiness of Citigroup Global Markets Australia Pty Limited and Citigroup Inc. For more details, please refer to Section 4 of this PDS.
¤ The Final Value per Unit is linked to the Average Worst Performance. Hence, Investors should also be aware that their exposure is not based on the average performance of all Reference Assets throughout the Term but, rather, on the average of the Worst Performing Reference Asset on each of the three (3) designated Observation Dates. Therefore, the performance of any Reference Asset other than the Worst Performing Reference Asset on an Observation Date will not be relevant in the calculation of the Final Value per Unit.


Download

  • Product Disclosure Statement
  • Investor Sale Form

More Information

For further information on structured financial products contact the Citigroup Structured Products Service Centre.

Phone : 1300 30 70 70.
Email : citifirst.au@citi.com
Mail :GPO Box 557 Sydney NSW 2001

Disclaimer
This material is made available by Citigroup Global Markets Australia Pty Limited (“Citigroup Global Markets”) ABN 64 003 114 832 and AFSL 240992, Participant of the ASX Group and a Participant of the Sydney Futures Exchange Limited. The Financial Products referred to in this document are issued by Citigroup Global Markets. Warrants can be traded on ASX and investors can obtain a copy of the relevant Product Disclosure Statement by contacting Citigroup. Investors may also apply for Instalment Warrants under the Product Disclosure Statement. This information does not take into account the investment objectives or financial situation of any particular person. Investors should be aware that there are risks of investing and that prices both rise and fall. Investors should seek their own independent financial advice based on their own circumstances before making a decision. Warrants are not bank deposits or obligations of, or guaranteed by, Citibank, N.A., Citibank Pty Limited or any of its affiliates or subsidiaries and are subject to investment risks, including the possible loss of the principal amount invested.

The terms set forth herein are intended for discussion purposes only and subject to the final expression of the terms of a transaction as set forth in a definitive agreement and/or confirmation. Although the information contained herein is based upon generally available information and has been obtained from sources believed to be reliable, we do not guarantee its accuracy, and such information may be incomplete or condensed. Any prices used herein are historic and may not be available when any order is entered. All opinions and estimates included in this document constitute our judgment as of this date and are subject to change without notice. This material does not purport to identify the nature of the specific market or other risks associated with a particular transaction. Before entering into a derivative transaction, you should ensure that you fully understand the terms of the transaction, relevant risk factors, the nature and extent of your risk of loss and the nature of the contractual relationship into which you are entering. You should also carefully evaluate whether the transaction is appropriate for you in light of your experience, objectives, financial resources, and other relevant circumstances and whether you have the operational resources in place to monitor the associated risks and contractual obligations over the term of the transaction.

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