Document:

Amended and Restated Registration Rights Agreement

 Exhibit 4.04 
  
 AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT 
  
 This Amended and Restated Registration Rights Agreement (the “Agreement”) is entered into on September 29, 2004
and effective as of July 1, 2004 by and between United PanAm Financial Corp., a California corporation (the “Company”), BVG West Corp., a California corporation (the “General Partner”) and Pan American Financial, L.P., a Delaware
limited partnership (the “Partnership”), with respect to the facts and circumstances recited below: 
  
 RECITALS 
  
 WHEREAS, the Partnership was formed in 1994 for the sole purpose of owning and holding shares of the Company’s common stock, no par value per share (the “Common Stock”), and, as of September 30, 2003, was the record owner of
8,681,250 shares of the Company’s Common Stock; 
  
 WHEREAS,
the Partnership is in the process of being dissolved, and, in connection with that dissolution and the subsequent liquidation, the Partnership entered into a trust agreement with Guillermo Bron, as trustee (the “Trustee”) creating the
PAFLP Liquidating Trust, a trust created under Delaware law (the “Liquidating Trust”) for the sole purpose of effecting an underwritten offering of up to 4,500,000 shares of the Company’s Common Stock; 
  
 WHEREAS, the Company and the Trustee thereafter entered into a Registration
Rights Agreement dated as of November 11, 2003 (the “Original Agreement”) pursuant to which, on November 13, 2002, the Company filed a registration statement (the “Original Registration Statement”) with the Securities and
Exchange Commission on Form S-3 (File No. 333-110478), as amended by Amendment No. 1 on April 6, 2004, which proposed to register 2,200,000 shares of the Company’s Common Stock; 
  
 WHEREAS, the Original Agreement granted certain registration rights to the Liquidating Trust, including the right to assign
such registration rights under specified circumstances; 
  
 WHEREAS, and the Partnership and the Liquidating Trust determined that, in order to facilitate the offering described in the Original Registration Statement, that the offering should be conducted directly by the Partnership rather than
through the Liquidating Trust; 
  
 WHEREAS, on March 9, 2004, the
Company, the General Partner, the Partnership and the Trustee entered into an Amendment of Agreement and Assignment of Registration Rights (the “Amendment”) pursuant to which the Liquidating Trust transferred and assigned the registration
rights under the Original Agreement to the Partnership; 
  
 WHEREAS, thereafter, the Original Registration Statement was amended to reflect the terms of the Amendment; 
  
 WHEREAS, thereafter, the Company began the process of shifting the funding source of its businesses and implementing a plan to exit the federal thrift
charter of its wholly-owned subsidiary, Pan American Bank FSB; 
  

 1 

 WHEREAS, thereafter, the Company’s Board of Directors discussed and analyzed the proposed public
offering described in the Original Registration Statement occurring concurrently with the Company’s plan to exit the federal thrift charter and determined that it would be seriously detrimental to the Company and its shareholders to continue
with the Original Registration Statement at that time; 
  
 WHEREAS, on June 28, 2004, the Company notified the General Partner and the Partnership that, in the good faith judgement of the Company’s Board of Directors it would be seriously detrimental to the Company and its shareholders to
continue the proposed public offering described in the Original Registration Statement; 
  
 WHEREAS, on June 28, 2004, the General Partner and the Partnership agreed to the withdrawal of the Original Registration Statement; 
  
 WHEREAS, on June 28, 2004, the Company filed an application with the Securities and Exchange Commission on Form RW to
withdraw the Original Registration Statement and all exhibits thereto; 
  
 WHEREAS, in consideration for the General Partner and the Partnership agreeing to the withdrawal of the Original Registration Statement, the Company, the General Partner and the Partnership desire that the Company will pay certain
registration expenses and desire to extend certain termination dates; 
  
 WHEREAS, the Company, the Partnership and the General Partner desire to enter into this Amended and Restated Registration Rights Agreement, to reflect changes of the Amendment and to include the registration expenses and extension of
termination dates; 
  
 NOW, THEREFORE, in accordance with the
foregoing recitals, and as consideration for the mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which hereby are acknowledged, the Company, the General Partner and the
Partnership hereby agree as follows: 
  
 AGREEMENT

  
 1. Registration Rights. 
  
 1.01 Definitions. As used in this Agreement, the following terms shall
have the following respective meanings: 
  
 (a) “1933
Act” means the Securities Act of 1933, as amended. 
  
 (b)
“1934 Act” means the Securities Exchange Act of 1934, as amended. 
  
 (c) “Common Stock” means the Company’s Common Stock. 
  

 2 

 (d) “Form S-3” means such form under the 1933 Act as in effect on the date hereof or any
registration form under the 1933 Act subsequently adopted by the Securities and Exchange Commission which permits inclusion or incorporation of substantial information by reference to other documents filed by the Company with the SEC. 
  
 (e) The terms “register,” “registered” and
“registration” refer to an underwritten registration effected by preparing and filing a registration statement or similar document in compliance with the 1933 Act, and the declaration or ordering of the effectiveness of such registration
statement or document by the SEC. 
  
 (f) The term
“Registrable Securities” means: (i) up to 4,500,000 shares of the Company’s Common Stock owned by the Partnership; and (ii) any securities of the Company issued (or issuable upon the conversion or exercise of any warrant, right or
other security which is issued) by way of a stock split, stock dividend, recapitalization, merger or other distribution with respect to, or in exchange for, or in replacement of, such Common Stock referred to in (i) above; provided,
however, that any Registrable Securities sold by a person in a public transaction pursuant to a registered offering under the 1933 Act or pursuant to Rule 144 promulgated thereunder, or in a private transaction in which its rights under this
Section 1 are not assigned, cease to be Registrable Securities. 
  
 (g) “SEC” shall mean the Securities and Exchange Commission. 
  
 (h) “SEC Rule 145 Transaction” shall mean any transaction described in Rule 145(a) promulgated under the 1933 Act. 
  
 1.02 Form S-3 or Form S-1 Registration. In case the Company shall receive from the General Partner a written request that the Company effect a
registration on Form S-3 (or any similar successor form) (or if Form S-3 is not available to the Company, on Form S-1 (or any similar successor form)) and any related qualification or compliance with respect to all or a part of the Registrable
Securities held by the Partnership, the Company will, as soon as practicable, but in no event more than one hundred twenty (120) days after receipt of the request of the General Partner, use commercially reasonable efforts to prepare and file with
the SEC such registration on Form S-3 (or Form S-1 or any similar successor forms) and all such qualifications and compliances as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of the
Registrable Securities as are specified in such request; provided, however, that the Company shall not be obligated to effect any such registration, qualification or compliance, pursuant to this Section 1.02: (i) except pursuant to an
underwritten offering; (ii) if the Partnership proposes to sell Registrable Securities at an aggregate price to the public of less than twelve million ($12,000,000); (iii) if the Partnership proposes to sell less than 1,500,000 Registrable
Securities; (iv) if the Company shall furnish to the General Partner a certificate signed by the President of the Company stating that in the good faith judgment of the Board of Directors of the Company, it would be seriously detrimental to the
Company and its shareholders for such Form S-3 (or Form S–1) registration to be effected at such time, in which event the Company shall have the right to defer the filing of the Form S-3 (or Form S–1) registration statement for a period of
not more than 120 days after receipt of the request of the 
  

 3 

 General Partner under this Section 1.02; provided, however, that the Company may not utilize this right
more than once in any twelve (12) month period; (v) if the Company has already effected one (1) registration on Form S-3 (or Form S–1 or applicable successor forms) at the request of the General Partner, which registration has been declared
effective; or (vi) in any particular jurisdiction in which the Company would be required to qualify to do business or to execute a general consent to service of process in effecting such registration, qualification or compliance. 
  
 Subject to the foregoing, the Company shall file and use commercially
reasonable efforts to bring effective a registration statement covering the Registrable Securities and other securities so requested to be registered as soon as practicable after receipt of the request or requests of the General Partner. 

 
 1.03 Piggy-Back Registration. If (but without any obligation to do
so) the Company proposes to register (including for this purpose a registration effected by the Company for shareholders other than the Partnership or its limited partners) any of its securities under the 1933 Act in connection with the public
offering of such securities solely for cash (other than a registration (i) on Form S-4, Form S-8 or any form which does not include substantially the same information as would be required to be included in a registration statement covering the sale
of the Registrable Securities, or (ii) with respect to an employee benefit plan, or (iii) solely in connection with a Rule 145 transaction under the 1933 Act), the Company shall, each such time, promptly give the General Partner written notice of
such registration together with a list of the jurisdictions in which the Company intends to attempt to qualify such securities under applicable state securities laws. Upon the written request of the General Partner given within twenty (20) business
days after delivery of such written notice by the Company in accordance with Section 2.03, the Company shall use commercially reasonable efforts to include in its registration and cause to be registered under the 1933 Act all of the Registrable
Securities that the General Partner has requested to be registered. 
  
 1.04 Underwriting. The Partnership shall have no right under this Agreement to registration except pursuant to an underwritten offering and the right of the Partnership to obtain registration shall be conditioned upon the
Partnership’s participation in the underwriting arrangements required by this Section 1.04, and the inclusion of the Partnership’s Registrable Securities in the underwriting to the extent requested shall be limited to the extent provided
herein. The Company shall, together with the Partnership, enter into an underwriting agreement in usual and customary form, with such terms and conditions which are satisfactory to the Company in its reasonable discretion (“Underwriting
Agreement”), with a managing underwriter selected for such underwriting by General Partner and reasonably acceptable to the Company. 
  
 Notwithstanding any other provision of this Section 1.04, if the managing underwriter advises the Company in writing that market factors require exclusion
of shares to be sold, or a limitation of the number of shares to be so sold, or a delay in the offering of the Registrable Securities, then the Company shall so advise the General Partner and the number of shares of Registrable Securities that may
be included in a registration and underwriting shall be reduced or the offering delayed. No such reduction shall reduce the securities being offered by the Company for its own account to be included in any registration and underwriting pursuant to
Section 1.03 and no such delay shall affect the Company’s rights under Section 1.02(iv). 
  

 4 

 1.05 Obligations of the Company. Whenever required under this Section 1 to effect the registration
of any Registrable Securities, the Company shall, as expeditiously as reasonably possible: 
  
 (a) Prepare and file with the SEC a registration statement with respect to such Registrable Securities and use commercially reasonable efforts to cause such registration statement to become effective. 
  
 (b) Prepare and file with the SEC such amendments and supplements to such
registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the 1933 Act. 
  

(c) Use its commercially reasonable efforts to register and qualify the securities covered by such registration statement under such other securities
or blue sky laws of such jurisdictions as shall be reasonably requested by the General Partner; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to
file a general consent to service of process in any such states or jurisdictions. 
  
 (d) Enter into and perform its obligations under the Underwriting Agreement. 
  
 (e) Cause all such Registrable Securities registered pursuant hereunder to be listed on each securities exchange on which similar securities issued by the
Company are then listed including without limitation, the automated quotation system of the National Association of Securities Dealers, Inc.’s National Market System. 
  
 (f) Provide a transfer agent and registrar for all Registrable Securities registered pursuant hereunder and a CUSIP number
for all such Registrable Securities, in each case not later than the effective date of such registration. 
  
 1.06 Obligations of Partnership. The Company’s registration obligations under this Agreement are conditioned upon the continued accuracy of
the following representations and warranties and the performance of the following ongoing covenants of the Partnership: 
  
 (a) The Partnership is a Delaware partnership in good standing under Delaware law and has full power and authority to enter into this Agreement and to
perform the transactions contemplated hereby; this Agreement has been duly authorized, executed and delivered by the Partnership and is a legal, valid and binding agreement of the Partnership. 
  
 (b) The Partnership is not in violation of the Partnership Agreement and the
execution and delivery of this Agreement does not, and the consummation of the transactions contemplated herein and compliance with the terms of this Agreement by the Partnership will not conflict with or constitute a default under: (i) the
Partnership Agreement; or (ii) any material agreement to which the Partnership is a party or to which the properties of Partnership are bound; 
  

 5 

 or (iii) any law, rule or regulation applicable to the Partnership; or (iv) any writ, injunction or decree of any
government, governmental instrumentality or court, domestic or foreign, having jurisdiction over the Partnership. 
  
 (c) No consent, approval, authorization or other order of any governmental authority or other third party is required in connection with the execution or
delivery by the Partnership of this Agreement or the offer and sale of the Registrable Securities, except such as may be required under the Securities Act or applicable state securities laws. 
  
 (d) There are no actions, suits or proceedings pending or to the knowledge of
the General Partner, threatened against the Partnership or the General Partner, or any affiliate thereof, at law or in equity or before or by any federal or state commission, regulatory body or administrative agency or other governmental body,
domestic or foreign, seeking to restrain or prohibit performance of this Agreement or the offer and sale of the Registrable Securities. 
  
 (e) The Partnership possesses good, valid and marketable title to the Registrable Securities, free and clear of any security interests, liens, equities,
claims, encumbrances or adverse interests of any kind; the Registrable Securities were acquired by the General Partner in a transaction or transactions which complied with applicable federal and state laws and the provisions of the Partnership
Agreement. 
  
 (f) In connection with any action pursuant to this
Section 1, the General Partner shall furnish to the Company such information regarding the Partnership, including information regarding beneficiaries of the Partnership, and information regarding the Registrable Securities held by it, and such other
and further information as shall be required to effect the registration of the Registrable Securities. In that connection, the General Partner shall be required to represent to the Company that all such information which is given is both complete
and accurate in all material respects when made. 
  
 (g) The
Partnership shall enter into and perform its obligations under the Underwriting Agreement. 
  
 1.07 Definition of Expenses. 
  
 (a) “Registration Expenses” shall mean all out-of-pocket expenses incurred by the Company in connection with the preparation, negotiation and finalization of this Agreement and in complying with Sections 1.02 and 1.03
hereof, including, without limitation, all registration, filing and qualification fees, all blue sky fees and expenses, underwriters’ expense allowances, printing expenses, fees and disbursements of counsel for the Company. 
  
 (b) “Selling Expenses” shall mean all underwriting discounts
and selling commissions and stock transfer taxes and all fees applicable to the sale of the Registrable Securities in the registration, and disbursements of any special counsel for the Partnership. 
  

 6 

 1.08 Expenses of Registration. 
  
 (a) Selling Expenses. Regardless of whether an offering is consummated, the Partnership shall bear all Selling
Expenses attributable to the Registrable Securities. 
  
 (b)
Registration Expenses incurred on or before June 28, 2004. Regardless of whether an offering is consummated, the Partnership shall reimburse the Company for all Registration Expenses incurred on or before June 28, 2004 upon the earlier to
occur of (A) the closing of the underwritten offering or (B) December 31, 2005. Commencing December 31, 2005, the Partnership shall reimburse the Company as described in paragraph (d) of this Section 1.08. 
  
 (c) Registration Expenses incurred after June 28, 2004. Regardless of
whether an offering is consummated, (i) the Company shall pay (and will not be reimbursed by the Partnership) for 50% of the Registration Expenses incurred after June 28, 2004 up to a maximum of $100,000, and (ii) the Partnership will reimburse the
Company for any balance not covered by the Company pursuant to subparagraph (i) upon the earlier to occur of (A) the closing of the underwritten offering or (B) December 31, 2005. Commencing December 31, 2005, the Partnership shall reimburse the
Company as described in paragraph (d) of this Section 1.08. 
  
 (d) Registration Expenses Incurred After December 31, 2005. Commencing December 31, 2005, Registration Expenses incurred by the Company after that date, if any, shall be reimbursed by the Partnership to the Company periodically, upon
the 10th of each month for Registration Expenses incurred in the prior month. 
  
 (e) Underwriting Agreement. The Company’s obligations under this Agreement shall be conditioned upon the receipt of reimbursement from the Partnership as described in this Section 1.08 and, if requested by
the Company, the terms of such reimbursement shall be reflected in the Underwriting Agreement. 
  
 (f) Failure to fulfill Obligations. Notwithstanding the provisions contained in paragraphs (b) and (c) of this Section 1.08, if the Company does not fulfill its obligations under Sections 1.02 and 1.03 solely
as a result of any failure by the Company to use its commercially reasonable efforts to perform the actions which it is required to perform thereunder, or a wrongful refusal by the Company to comply with any material term or fulfill any material
condition which is applicable to it thereunder, the Company agrees in that event to reimburse the Partnership for any Registration Expenses reimbursed or reasonably incurred by it, as the case may be, in connection therewith. 
  
 1.09 Indemnification. 
  
 (a) In the event any Registrable Securities are included in a registration
statement under this Section 1, to the extent permitted by law, the Company will indemnify and hold harmless the Partnership against any losses, claims, damages, or liabilities (joint or several) to which it may become subject under the 1933 Act,
the 1934 Act or other federal or state law, 
  

 7 

 insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon
any of the following statements, omissions or violations (collectively, a “Violation”): (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus
or final prospectus contained therein or any amendments or supplements thereto; (ii) the omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein not misleading; or
(iii) any violation or alleged violation by the Company of the 1933 Act, the 1934 Act, any state securities law or any rule or regulation promulgated under the 1933 Act, the 1934 Act or any state securities law; and the Company will reimburse the
Partnership for any legal or other expenses reasonably incurred by them, as incurred, in connection with investigating or defending any such loss, claim, damage, liability, or action; provided, however, that the Company’s
indemnity contained in this Section 1.09(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Company (which consent shall not be unreasonably
withheld), nor shall the Company be liable in any such case for any such loss, claim, damage, liability, or action to the extent that it arises out of or is based upon a breach of the Partnership’s representations, warranties, covenants and
agreements hereunder or a Violation which occurs in reliance upon and in conformity with written information furnished in writing and expressly stated for use in connection with such registration by the Partnership or its affiliates or controlling
person; provided further, however, that when the Company and the Partnership enter into an Underwriting Agreement, the indemnification provisions thereof (to the extent the provisions are inconsistent with this Section 1.09(a))
shall take precedence and control over this Section 1.09(a). 
  
 (b) In the event any Registrable Securities are included in a registration statement under this Section 1, to the extent permitted by law, the Partnership will indemnify and hold harmless the Company, each of its directors, each of its
officers who have signed the registration statement, each person, if any, who controls the Company within the meaning of the 1933 Act, any underwriter (within the meaning of the 1933 Act) for the Company, and any person who controls such underwriter
against any losses, claims, damages or liabilities (joint or several) to which any of the foregoing persons may become subject, under the 1933 Act, the 1934 Act or other federal or state law, insofar as such losses, claims, damages, or liabilities
(or actions in respect thereto) arise out of or are based upon a breach of the Partnership’s representations, warranties, covenants and agreements hereunder, or upon any Violation, to the extent (and only to the extent) that such Violation
occurs in reliance upon and in conformity with written information furnished the Partnership expressly stated in a writing for use in connection with such registration; and the Partnership will reimburse any legal or other expenses, as incurred,
where same are reasonably incurred by any person intended to be indemnified pursuant to this Section 1.09(b), in connection with investigating or defending any such loss, claim, damage, liability, or action; provided, however, that the
indemnity agreement contained in this Section 1.09(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Partnership, which consent shall not
be unreasonably withheld; provided further, however, that in no event shall any indemnity under this Section 1.09(b) exceed the net proceeds received by the Partnership; 
  

 8 

 provided further, however, that when the Company and the Partnership enter into an Underwriting
Agreement, the indemnification provisions thereof (to the extent the provisions are inconsistent with this Section 1.09(b)) shall take precedence and control over this Section 1.09(b). 
  
 (c) To the extent permitted by law, the Partnership will indemnify and hold harmless the Company, each of its directors and
officers, each person, if any, who controls the Company within the meaning of the 1933 Act, any underwriter (within the meaning of the 1933 Act) for the Company, and any person who controls such underwriter from and against any and all losses,
costs, damages, liabilities, fees (including without limitation attorneys’ fees) and expenses, to which any of the foregoing persons may become subject by reason of or in connection with any claim, demand, action or cause of action arising from
or relating to the liquidation or dissolution of Pan American Financial L.P. brought by any limited partner. The indemnity set forth in this Section 1.09(c) will not be subject to the limitations otherwise set forth in this Section 1.09. 

 
 (d) Promptly after receipt by an indemnified party under this Section 1.09
of notice of the commencement of any action (including any governmental action), such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 1.09, notify the indemnifying party in
writing of the commencement thereof, and the indemnifying party shall have the right to participate in and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof
with counsel mutually satisfactory to the parties; provided, however, that an indemnified party shall have the right to retain its own counsel, with the reasonable fees and expenses to be paid by the indemnifying party, if the
indemnified party reasonably determines that representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any
other party represented by such counsel in such proceeding. The failure to notify an indemnifying party within a reasonable time of the commencement of any such action, to the extent prejudicial to its ability to defend such action, shall relieve
such indemnifying party of any liability to the indemnified party under this Section 1.09, but the omission so to notify the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this
Section 1.09. 
  
 (e) If the indemnification provided for in this
Section 1.09 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to any losses, claims, damages or liabilities referred to herein, the indemnifying party, in lieu of indemnifying such indemnified party
thereunder, shall to the extent permitted by applicable law contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of
the indemnifying party, on the one hand, and of the indemnified party, on the other, in connection with that which resulted in such loss, claim, damage or liability, as well as any other relevant equitable considerations. The relative fault of the
indemnifying party and of the indemnified party shall be determined by a court of law by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to
information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent. 
  

 9 

 1.10 Reports Under Securities Exchange Act of 1934. With a view to making available to the
Partnership the benefits of Rule 144 promulgated under the 1933 Act and any other rule or regulation of the SEC that may at any time permit the Partnership to sell securities of the Company to the public without registration, the Company agrees to:

  
 (a) file with the SEC in a timely manner all reports and
other documents required of the Company under the 1933 Act and the 1934 Act; and 
  
 (b) furnish to the General Partner, so long as the Partnership holds any Registrable Securities, forthwith upon request: (i) a written statement by the Company that it has complied with the reporting requirements of
Rule 144, the 1933 Act and the 1934 Act, or that it qualifies as a registrant whose securities may be resold pursuant to Form S-3; (ii) a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed
by the Company; and (iii) such other information as may be reasonably requested in order to permit the Partnership to avail itself of any rule or regulation of the SEC or any state securities authority which permits the selling of any such
securities without registration or pursuant to such form. 
  
 1.11
Assignment of Registration Rights. Registration rights pursuant to this Section 1 may be assigned by the Partnership to a transferee or assignee of such securities: (i) if such transfer is made by the Partnership of all Registrable Securities
held on behalf of the beneficiaries of the Partnership for the purpose of facilitating the liquidation and dissolution of the Partnership; and (ii) the transfer is made to one person or entity, provided, however, that the Company is,
within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee or assignee; provided further, however, that such assignment shall be effective only if the transferee agrees to be
bound by the terms and conditions of this Agreement. 
  
 1.12
“Market Stand-Off” Agreement. The Partnership agrees that, in connection with the underwritten public offering of the Company’s Common Stock, upon request of the Company or the underwriters managing such underwritten offering
of the Company’s Common Stock, not to sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any Common Stock of the Company (other than those Common Stock shares included in the registration) without
the prior written consent of the Company or such underwriters, as the case may be, for such period of time (not to exceed one hundred eighty (180) days) from the effective date of such registration as may be requested by the underwriters and as is
agreed to by each beneficial owner of 10% or more of the Company’s Common Stock and each officer and director of the Company; provided, however, that the Partnership shall be released from any such agreement at the same time that such officers,
directors or beneficial owners may be released. In order to enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Registrable Securities of the Liquidating Trust (and the shares of securities of every
other person subject to the foregoing restriction) until the end of such period; provided further, however, that the Company shall have no obligation other than to use its commercially reasonable efforts to obtain any similar agreement from the
limited partners if requested by such underwriters. 
  

 10 

 1.13 Limitations on Subsequent Registration Rights. During the term of this Agreement, the Company
shall not, without the prior written consent of the Partnership, which shall not be unreasonably withheld, enter into any agreement with any holder or prospective holder of any securities of the Company which would: (i) allow such holder or
prospective holder to include such securities in any registration filed by the Company, unless under the terms of such agreement, such holder or prospective holder may include such securities in any such registration only to the extent that this
inclusion of such holder’s securities will not reduce the amount of Registrable Securities of the Partnership which is included; (ii) permit such holder or prospective holder to require the Company to initiate any registration of any securities
of the Company; or (iii) otherwise be in conflict with the terms hereof. 
  
 1.14 Termination of the Company’s Obligations. The right of the Partnership to request registration or inclusion in any registration pursuant to this Section 1 shall terminate on the earlier to occur of
(i) March 31, 2007, which date will be extended to July 31, 2007 if the Company exercises its right to defer a demand registration under Section 1.02(iv) after December 2, 2006; or (ii) the date on which all shares of Registrable Securities held by
the Partnership can be sold in any three month period without volume restrictions under Rule 144; or (iii) upon termination of the Partnership. 
  
 2. General Provisions. 
  
 2.01 Further Assurances. Each party agrees to cooperate fully with the other parties and to execute such further instruments, documents and
agreements and to give such further written assurances, as may be reasonably requested by any other party to better evidence and reflect the transactions described herein and contemplated hereby, and to effect the intents and purposes of this
Agreement. 
  
 2.02 Rights Cumulative. Each and all of the
various rights, powers and remedies of the parties hereto shall be considered to be cumulative with and in addition to any other rights, powers and remedies which such parties may have at law or in equity in the event of the breach of any of the
terms of this Agreement. The exercise or partial exercise of any right, power or remedy shall neither constitute the exclusive election thereof nor the waiver of any other right, power or remedy available to such party. 
  
 2.03 Notices. All notices, consents or demands of any kind which any
party to this Agreement may be required or may desire to serve on any other party hereto in connection with this Agreement shall be in writing and may be delivered by personal service or overnight courier, by telex or facsimile transfer, or by
registered or certified mail, return receipt requested, deposited in the United States mail with first-class postage thereon fully prepaid, addressed as set forth below. Service of any such notice or demand so made by mail shall be deemed complete
on the date of actual delivery as shown by the addressee’s registry or certification receipt or at the expiration of five (5) business days after the date of mailing, whichever is earlier. Any party 
  

 11 

 hereto may from time to time by notice in writing served upon the other party as aforesaid, designate a different mailing
address or a different person to which such notices or demands are thereafter to be addressed or delivered. 
  

			
	 If to the Company:
	 	 United Pan Am Financial Corp.
 Attn: Ray Thousand, President
 3990 Westerly Place, Suite 200
 Newport Beach, CA 92660
 Facsimile: 949-224-1912
 Telephone: 949-224-1278

		
	 If to the Partnership:
	 	 BVG West Corporation, General Partner
 Attn: Guillermo Bron, President
 1901 Avenue of the Stars, Suite 970
 Los Angeles, CA 90067
 Facsimile: 310-277-7582
 Telephone: 310-788-5700

  
 2.04 Captions.
Captions are provided herein for convenience only and they form no part of this Agreement and are not to serve as a basis for interpretation or construction of this Agreement, nor as evidence of the intention of the parties hereto. 
  
 2.05 Severability. The invalidity, in whole or in part, of any
provision of this Agreement shall not affect the validity or enforceability of any other of its provisions. If one or more provisions hereof shall be so declared invalid or unenforceable, the remaining provisions shall remain in full force and
effect and shall be construed in the broadest possible manner to effectuate the purposes hereof. The parties further agree to replace such void or unenforceable provisions of this Agreement with valid and enforceable provisions which will achieve,
to the extent possible, the economic, business and other purposes of the void or unenforceable provisions. 
  
 2.06 Attorneys’ Fees. In any action at law or in equity to enforce any of the provisions or rights under this Agreement, the unsuccessful
party to such litigation, as determined by the court in a final judgment or decree, shall pay the successful party all reasonable costs, expenses and attorneys’ fees incurred by the successful party (including, without limitation, costs,
expenses and fees on any appeal) with respect to such action. 
  
 2.07 Counterparts; Facsimile. This Agreement may be executed in separate counterparts and in facsimile, each of which shall be deemed an original, and when executed, separately or together, shall constitute a single original
instrument, effective in the same manner as if the parties hereto had executed one and the same instrument. 
  
 2.08 Waiver. No waiver of any term, provision or condition herein, whether by conduct or otherwise, in any one or more instances, shall be deemed
to be, or be construed as, a further or continuing waiver of any such term, provision or condition or as a waiver of any other term, provision or condition hereof. 
  

 12 

 2.09 Entire Agreement. This Agreement is intended by the parties hereto to be the final expression
of their agreement and constitutes and embodies the entire agreement and understanding of the parties with regard to the subject matter hereof, and is a complete and exclusive statement of the terms and conditions hereof, and shall supersede any and
all prior correspondence, conversations, negotiations, agreements or understandings relating to the same subject. 
  
 2.10 Governing Law. It is the intention of the parties that the internal laws of the State of California (irrespective of its choice of law
principles) shall govern the validity of this Agreement, the construction of its terms and the interpretation of the rights and duties of the parties. 
  
 2.11 Successors and Assigns; No Third Party Beneficiaries. This Agreement and all of its terms, conditions and covenants are intended to be fully
effective and binding, to the extent permitted by law, upon and inure solely to the benefit of each party hereto and their respective heirs, executors, administrators, successors and permitted assigns, and nothing in this Agreement, express or
implied, is intended to confer upon any other person, including beneficiaries of the Partnership, any rights or remedies of any nature whatsoever under or by reason of this Agreement. 
  
 2.12 Amendment. This Agreement may not be modified, amended, altered or changed in any respect whatsoever except by
further agreement in writing, duly executed by all parties hereto. No oral statements or representations made after the date of this Agreement by either party hereto are binding on such party, and neither party hereto shall have the right to rely on
such oral statements or representations. 
  
 2.13 Choice of
Forum. Any judicial proceeding brought by any party hereto as a result of a dispute or controversy arising out of or related to this Agreement shall be commenced in courts located within Los Angeles County, California. All parties hereto agree
to submit to the jurisdiction of the federal and state courts located within such county in the event of such a dispute or controversy. 
  
 2.14 Assignment. Neither this Agreement nor any of the rights, interests or obligations of either party hereto arising under this Agreement may be
assigned by either party hereto without the prior written consent of the other party hereto. 
  

 13 

 IN WITNESS WHEREOF, the parties hereto have executed this Amended and Restated Registration Rights
Agreement with the intent and agreement that the same shall be effective as of the day and year first above written. 
  

					
	COMPANY:	 	UNITED PAN AM FINANCIAL CORP.
			
	 	 	By:	 	 /s/ Ray Thousand

	 	 	 	 	Ray Thousand, Chief Executive Officer and President
		
	GENERAL PARTNER:	 	BVG WEST CORPORATION
			
	 	 	By:	 	 /s/ Guillermo Bron

	 	 	 	 	Guillermo Bron, President
		
	PARTNERSHIP:	 	PAN AMERICAN FINANCIAL L.P.
			
	 	 	By:	 	BVG West Corporation, sole general partner
			
	 	 	By:	 	 /s/ Guillermo Bron

	 	 	 	 	Guillermo Bron, President

  

 14Form of Note for the Company's Enhanced Income Strategy

 Exhibit 4.01 
  
 THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO A NOMINEE OF DTC
OR BY DTC OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF DTC TO CITIGROUP GLOBAL MARKETS HOLDINGS INC. OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. 
  

			
	No. R-1	 	INITIAL PRINCIPAL AMOUNT
	CUSIP 173076 83 7	 	REPRESENTED $390,100,000
	ISIN: US1730768371	 	representing 39,010,000 Notes
	 	 	($10 per Note)

  
 CITIGROUP GLOBAL
MARKETS HOLDINGS INC. 
 Enhanced Income Strategy SM 
 Principal-Protected Notes with Income and Appreciation Potential 
 Linked to the 2004-4 Dynamic Portfolio IndexSM due November 27, 2009 
  
 Citigroup
Global Markets Holdings Inc., a New York corporation (hereinafter referred to as the “Company,” which term includes any successor corporation under the Indenture herein referred to), for value received and on condition that this
Note is not redeemed by the Company prior to November 27, 2009 (the “Stated Maturity Date”), hereby promises to pay to CEDE & CO., or its registered assigns, the Maturity Payment (as defined below), on the Stated Maturity Date.
This Note will bear quarterly payments of interest (which may be zero), is not subject to any sinking fund, is not subject to redemption at the option of the holder thereof prior to the Stated Maturity Date, and is not subject to the defeasance
provisions of the Indenture. 
  
 Payment of the Maturity Payment
with respect to this Note shall be made upon presentation and surrender of this Note at the corporate trust office of the Trustee in the Borough of Manhattan, The City and State of New York, in such coin or currency of the United States as at the
time of payment is legal tender for payment of public and private debts. 
  
 This Note is one of the series of Enhanced Income Strategy SM Principal-Protected
Notes with Income and Appreciation Potential Linked to the 2004-4 Dynamic Portfolio IndexSM due November 27, 2009
(the “Notes”). 

 INTEREST 
  
 The interest payable on the Notes will vary and may be zero. Interest, if any, will be paid in cash quarterly on each 26th
day of each February, May, August and November, commencing on November 26, 2004 (each such date, an “Interest Payment Date”). The interest on the Notes for any quarter will depend on the allocation of the 2004-4 Dynamic Portfolio
Index to the 2004-1 Income 10 Buy-Write Index Portfolio and on the notional income on the 2004-1 Income 10 Buy-Write Index. 
  
 The interest payment (“IP”) on the Notes, if any, for any quarterly calculation period will be calculated as follows: 
  

			
	 IP   =  
	 	 BWU * BWNIU

	 	 10

  
 “BWU”
is the number of 2004-1 Income 10 Buy-Write Index units included in the 2004-4 Dynamic Portfolio Index on the last day of the quarterly calculation period. 
  
 “BWNIU” is the notional income per unit of the 2004-1 Income 10 Buy-Write Index for that quarterly calculation period. 
  
 If an Interest Payment Date falls on a day that is not a Business Day, the
interest payment to be made on such Interest Payment Date will be made on the next succeeding Business Day with the same force and effect as if made on such Interest Payment Date and no additional interest will accrue as a result of such delayed
payment. Interest will be computed on the basis of a 360-day year of twelve 30-day months. 
  
 “Business Day” means any day that is not a Saturday, a Sunday or a day on which the securities exchanges or banking institutions or trust companies in the City of New York are authorized or obligated
by law or executive order to close. 
  
 The commencement dates for
the quarterly calculation periods will be the 20th day of each February, May, August and November. Interest will be calculated from, and including, one commencement date to, but excluding, the next commencement date, provided that the final
quarterly calculation period will extend to, and include, the fifth Index Business Day prior to the Stated Maturity Date. No interest will accrue on the Notes after the fifth Index Business Day before the Stated Maturity Date through the Stated
Maturity Date. The Interest Payment Date related to any quarterly calculation period with respect to which interest is paid will be the Interest Payment Date following the last day of the applicable quarterly calculation period or, with respect to
the final quarterly calculation period, the Stated Maturity Date. The calculation agent will notify the trustee of the amount of interest payable on or before the second Business Day immediately following the last day of the applicable quarterly
calculation period. Interest will be payable to the persons in whose names the Notes are registered at the close of business on the Business Day succeeding the last day of the applicable quarterly calculation period. 
  

 2 

 If at the close of business on the last day of any quarterly calculation period (except the last
quarterly calculation period before the Stated Maturity Date), the calculation agent determines that the value of the 2004-4 Dynamic Portfolio Index (less any notional income on the 2004-1 Income 10 Buy-Write Index) is less than or equal to 105% of
the Bond Floor (as defined below), the calculation agent will notionally reinvest the value of any notional income on the 2004-1 Income 10 Buy-Write Index relating to that quarterly calculation period in the 2004-1 Income 10 Buy-Write Index
Portfolio at the close of business on the first Index Business Day of the next quarterly calculation period and no interest will be paid on the Notes on the Interest Payment Date relating to that quarterly calculation period. 
  
 PAYMENT AT MATURITY 
  
 On the Stated Maturity Date, holders of the Notes will receive for each Note
the final quarterly interest payment, if any, and the Maturity Payment described below. 
  
 DETERMINATION OF THE MATURITY PAYMENT 
  
 The Maturity Payment for each Note equals the sum of the principal amount of $10 per Note plus the Index Return Amount, which may be positive or zero but
which will not be negative. 
  
 The Index Return Amount will be
based on the closing value of the 2004-4 Dynamic Portfolio Index on the fifth Index Business Day before the Stated Maturity Date. 
  
 The “Index Return Amount” equals: $10 * Index Return 
  
 The “Index Return” equals: 
  

					
	 	 	 Ending Value – Starting Value

	 	 
	 	 	 Starting Value
	 	 

  
 provided that the Index Return will
not in any circumstances be less than zero. 
  
 The
“Starting Value” is 100.00, the initial value of the 2004-4 Dynamic Portfolio Index. 
  
 The “Ending Value” will be the closing value of the 2004-4 Dynamic Portfolio Index on the fifth Index Business Day before the Stated
Maturity Date. 
  
 The determination of the value (including a
closing value) of any component of the 2004-4 Dynamic Portfolio Index or of a Reallocation Event (as described below) by the calculation agent in the event any such value is unavailable may be deferred by the calculation agent for up to two
consecutive Index Business Days on which a Market Disruption Event is occurring. No reallocation of the value of the 2004-4 Dynamic Portfolio Index will occur on any day the determination of any of the above values is so deferred. 
  
 An “Index Business Day” means a day, as determined by the
calculation agent, on which the 2004-4 Dynamic Portfolio Index or any successor index is calculated and published and on 
  

 3 

 which securities comprising more than 80% of the value of the 2004-1 Income 10 Portfolio on such day are capable of being
traded on their relevant exchanges during the one-half hour before the determination of the closing value of the 2004-4 Dynamic Portfolio Index. All determinations made by the calculation agent will be at the sole discretion of the calculation agent
and will be conclusive for all purposes and binding on the Company and the beneficial owners of the Notes, absent manifest error. 
  
 A “Market Disruption Event” means, as determined by the calculation agent in its sole discretion (A) the occurrence or existence of any
suspension of or limitation imposed on trading (by reason of movements in price exceeding limits permitted by any exchange or market or otherwise) of, or the unavailability, through a recognized system of public dissemination of transaction
information, for a period longer than two hours, or during the one-half hour period preceding the close of trading, on the applicable exchange, of accurate price, volume or related information in respect of, (1) stocks which then comprise 20% or
more of the value of the 2004-1 Income 10 Portfolio, or (2) any options contracts or futures contracts relating to stocks which then comprise 20% or more of the value of the 2004-1 Income 10 Portfolio, or any options on such futures contracts, or
(B) the cancellation or repudiation of any options contracts or futures contracts relating to stocks which then comprise 20% or more of the value of the 2004-1 Income 10 Portfolio on any exchange or market if, in each case, in the determination of
the calculation agent, any such suspension, limitation, unavailability, cancellation or repudiation is material. For the purpose of determining whether a Market Disruption Event exists at any time, if trading in a security included in the 2004-1
Income 10 Portfolio is materially suspended or materially limited at that time, then the relevant percentage contribution of that security to the value of the 2004-1 Income 10 Portfolio will be based on a comparison of the portion of the value of
the 2004-1 Income 10 Portfolio attributable to that security relative to the overall value of the 2004-1 Income 10 Portfolio, in each case immediately before that suspension or limitation. 
  
 THE 2004-4 DYNAMIC PORTFOLIO INDEX 
  
 Based on the value of the 2004-4 Dynamic Portfolio Index on September 28,
2004, the initial allocation to the 2004-1 Income 10 Buy-Write Index portfolio was targeted to equal 62% of the value of the 2004-4 Dynamic Portfolio Index (the “Target Buy-Write Index Initial Allocation”) and the allocation to the
notional bond portfolio was targeted to equal 38% of the value of the 2004-4 Dynamic Portfolio Index (the “Target Bond Portfolio Initial Allocation” and, together with the Target Buy-Write Index Initial Allocation, the “Target Initial
Allocation”). 
  
 The actual initial allocation to the 2004-1
Income 10 Buy-Write Index portfolio as well as the actual number of 2004-1 Income 10 Buy-Write Index units represented by such actual allocation will be determined over the three index business days beginning one index business day immediately
following September 28, 2004 (the “Initial Allocation Period”), while the actual allocation to the notional bond portfolio, as well as the actual number of notional bond units represented by the actual allocation, will be determined at the
end of the first day of the Initial Allocation Period. On September 28, 2004, the initial value of the 2004-4 Dynamic Portfolio Index was allocated to a notional investment bearing interest at the effective overnight Federal Funds Rate. Subject to
the provisions of the next paragraph, on the first day of the Initial Allocation Period, the amount of the Federal Funds Rate notional investment (including interest 
  

 4 

 earned on that investment up to such date) was reduced by the Target Bond Portfolio Initial Allocation and a number of
notional bond units will be allocated to the 2004-4 Dynamic Portfolio Index equal to (x) such amount, divided by (y) the value of a notional bond unit at the close of business on such day. Subject to the provisions of the next paragraph, on each day
of the Initial Allocation Period, the amount of the Federal Funds Rate notional investment (including interest earned on that investment up to such date) will be reduced by one-third of the Target 2004-1 Income 10 Buy-Write Index Initial Allocation
and a number of 2004-1 Income 10 Buy-Write Index units will be allocated to the 2004-4 Dynamic Portfolio Index equal to (a) such amount divided by (b) the value of a 2004-1 Income 10 Buy-Write Index unit at the close of business on such day. Subject
to the provisions of the next paragraph, at the close of business on the third day of the Initial Allocation Period, the allocation of the notional investment represented by the 2004-4 Dynamic Portfolio Index to the 2004-1 Income 10 Buy-Write Index
portfolio and the notional bond portfolio will be the actual initial allocation, which may not be the same as the Target Initial Allocation. During the Initial Allocation Period, the amount within the 2004-4 Dynamic Portfolio Index not allocated to
the 2004-1 Income Buy-Write Index portfolio and the notional bond portfolio will continue to be allocated to a notional investment bearing interest at the effective overnight Federal Funds Rate. 
  
 If at the beginning of either the second or third day of the Initial
Allocation Period the calculation agent had determined that a Reallocation Event had occurred due to (i) a decrease in the Gap Ratio below 15%, (ii) a decline of 10% or more in the value of the Dow Jones Industrial Average during the index business
day, or (iii) the value of the 2004-4 Dynamic Portfolio Index falling below 101% of the value of the Bond Floor, the determination of the allocation of the 2004-4 Dynamic Portfolio Index between the 2004-1 Income 10 Buy-Write Index portfolio and the
notional bond portfolio would have been made as described below on pages 8 and 9 of this Note and not as described above. 
  
 The value of the 2004-4 Dynamic Portfolio Index (“DPIV”), on any Index Business Day was and will continue to be calculated according to
the following formula: 
  
 DPIV = BWP + NBP – NPF 

 
 “BWP” is the value of the 2004-1 Income 10 Buy-Write
Index Portfolio, net of the portion of the 2004-4 Dynamic Portfolio Adjustment Factor allocated to the 2004-1 Income 10 Buy-Write Index Portfolio. 
  
 “NBP” is the value of the Notional Bond Portfolio, net of the portion of the Dynamic Portfolio Adjustment Factor allocated to the
Notional Bond Portfolio. 
  
 “NPF” is the value
of notional borrowed funds outstanding under the Notional Participation Facility. 
  
 The value of the 2004-4 Dynamic Portfolio Index will include the value of the notional income, if any, removed from the value of the 2004-1 Income 10 Buy-Write Index Portfolio on the last day of a quarterly
calculation period only if that notional income is to be notionally reinvested in additional 2004-1 Income 10 Buy-Write Index units at the close of business on the first Index Business Day of the next quarterly calculation period. 
  

 5 

 The value of the 2004-4 Dynamic Portfolio Index on any day that is not an Index Business Day will equal
the value of the 2004-4 Dynamic Portfolio Index on the previous day minus the Dynamic Portfolio Adjustment Factor and the Notional Participation Facility Fee for that day. 
  
 The “2004-1 Income 10 Buy-Write Index Portfolio” will represent notional investments in the 2004-1 Income
10 Buy-Write Index. The value of the 2004-1 Income 10 Buy-Write Index Portfolio will equal the product of (i) the number of 2004-1 Income 10 Buy-Write Index units in the 2004-1 Income 10 Buy-Write Index Portfolio; and (ii) the value of one 2004-1
Income 10 Buy-Write Index unit at that time. The value of one 2004-1 Income 10 Buy-Write Index unit will equal one percent of the value of the 2004-1 Income 10 Buy-Write Index at that time. 
  
 The “Notional Bond Portfolio” will represent notional
investments in Notional U.S. Treasury Strips or Notional Discount Bonds. The value of the Notional Bond Portfolio at any time will equal the product of (i) the number of bond units in the Notional Bond Portfolio at that time; and (ii) the value of
one bond unit at that time. 
  
 If the amount allocated to the
2004-1 Income 10 Buy-Write Index Portfolio is greater than zero, each bond unit will comprise one “Notional U.S. Treasury Strip” that: (i) is denominated in U.S. dollars; (ii) has a redemption amount equal to $1.00; (iii) does not
pay interest; and (iv) matures on the fifth Index Business Day prior to the Stated Maturity Date. If the Notional Bond Portfolio comprises Notional U.S. Treasury Strips, the value of one bond unit will equal the value of one Notional U.S. Treasury
Strip. The value of a Notional U.S. Treasury Strip will be determined by the calculation agent by discounting the notional redemption amount of the strip from the strip’s maturity date by the interpolated U.S. Treasury strip yield for the
Notional U.S. Treasury Strips. The interpolated yield will be calculated by performing an interpolation between the yield for the U.S. Treasury strip with a shorter term nearest to the term of the Notional U.S. Treasury Strip and the yield for the
U.S. Treasury strip with a longer term nearest to the term of the Notional U.S. Treasury Strip. As a result, the value of a bond unit will change as the value of the Notional U.S. Treasury Strips changes in response to changes in interest rates.

  
 If the amount allocated to the 2004-1 Income 10 Buy-Write
Index Portfolio is zero, each bond unit will comprise one “Notional Discount Bond” that: (i) is denominated in U.S. dollars; (ii) has a redemption amount equal to $1.00; (iii) matures on the fifth Index Business Day prior to the
Stated Maturity Date; and (iv) pays a coupon at a rate equal to 1.14% per annum daily, calculated on the basis of a 365-day year. 
  
 If the Notional Bond Portfolio comprises Notional Discount Bonds, the value of one bond unit will equal the value of one Notional Discount Bond. The value
of a Notional Discount Bond will be determined by the calculation agent by discounting the notional redemption amount of the bond from the date of redemption and any remaining notional coupons on the bond until its maturity date from the expected
payment dates of the remaining coupons using discount rates 
  

 6 

 equal to the sum of (i) interpolated yields derived from the U.S. dollar swap rate (or U.S. dollar LIBOR rates for
maturities of one year or shorter) interpolated to the maturity date of the bond and the payment dates for each of the remaining coupons; and (ii) 0.08%. The U.S. dollar swap rate is based upon the U.S. Treasury rate plus a credit spread as provided
by Bloomberg Financial Markets or another recognized source selected by the calculation agent on that date. The notional coupons on the Notional Discount Bonds will be reinvested in the Notional Bond Portfolio through the notional purchase of
additional bond units at the close of business on each Index Business Day. 
  
 If no value of the Notional Bond Portfolio is available on any date because of a Market Disruption Event or otherwise, unless as deferred by the calculation agent as described above, the value of the Notional Bond
Portfolio will be the arithmetic mean, as determined by the calculation agent, of the value of the Notional Bond Portfolio obtained from as many dealers in fixed-income securities (which may include Citigroup Global Markets Inc. or any of the
Company’s other subsidiaries or affiliates), but not exceeding three such dealers, as will make such value available to the calculation agent. 
  
 The “Dynamic Portfolio Adjustment Factor” will accrue daily on the basis of a 365-day year and on any day will equal the product of
(1/365) and the sum of (i) 0.74; and (ii) 0.75% (or 0.40% if the allocation to the 2004-1 Income to Buy-Write Index is zero) of the greater of 100 and the value of the 2004-4 Dynamic Portfolio Index at the end of the previous day, after effecting
any required reallocation. The Dynamic Portfolio Adjustment Factor will be calculated and subtracted from the 2004-1 Income 10 Buy-Write Index Portfolio and the Notional Bond Portfolio on a pro rata basis at the end of each day after effecting any
reallocation on that day, commencing as of September 30, 2004. Subtraction of the Dynamic Portfolio Adjustment Factor will be effected by reducing the number of units in each of the 2004-1 Income 10 Buy-Write Index Portfolio and the Notional Bond
Portfolio by the number of 2004-1 Income 10 Buy-Write units and bond units, respectively, of each portfolio with an aggregate value as of the close of business on the previous day equal to each portfolio’s pro rata portion of the Dynamic
Portfolio Adjustment Factor. 
  
 The “Notional
Participation Facility Fee” on any day will equal the product of (i) (1/360); (ii) the Notional Participation Facility Amount at the end of the previous day after any reallocations effected on that day, including any outstanding Notional
Participation Facility Fees; and (iii) the effective Federal Funds Rate for that day plus 1.00%. The Notional Participation Facility Fee will accrue daily and will be computed on the basis of a 360-day year. The “Federal Funds Rate”
on any day will be the rate for Federal Funds as published in H.15(519) under the heading “Federal Funds (Effective)” and if that day is not an Index Business Day, the rate for Federal Funds as published on the previous Index Business Day.

  
 The “Notional Participation Facility Amount”
will be calculated at the end of each day prior to any reallocation to the 2004-1 Income 10 Buy-Write Index Portfolio and will equal the sum of (i) notional borrowed funds outstanding under the Notional Participation Facility plus any outstanding
Notional Participation Facility Fees and (ii) the Notional Participation Facility Fee for that day. 
  

 7 

 After September 28, 2004, the allocation of the notional investment represented by the 2004-4 Dynamic
Portfolio Index to the 2004-1 Income 10 Buy-Write Index Portfolio and the Notional Bond Portfolio will be modified if a Reallocation Event occurs. Reallocations of the 2004-4 Dynamic Portfolio Index will be effected through the notional purchase and
sale of 2004-1 Income 10 Buy-Write Index units and bond units. Reallocations of the 2004-4 Dynamic Portfolio Index may involve the notional purchase and sale of fractional 2004-1 Income 10 Buy-Write Index units and fractional bond units. 

 
 A “Reallocation Event” will occur when the ratio (the
“Gap Ratio”) of (x) the difference between the value of the 2004-4 Dynamic Portfolio Index and the Bond Floor to (y) the value of the 2004-4 Dynamic Portfolio Index allocated to the 2004-1 Income 10 Buy-Write Index Portfolio is less
than or greater than certain predetermined ratios. The calculation agent will determine whether a Reallocation Event has occurred at the beginning of each Index Business Day up to and including the fifth Index Business Day prior to the Stated
Maturity Date. A Reallocation Event will be deemed to have occurred if the Gap Ratio is below 15% or above 25% at the close of business on the previous Index Business Day; provided that during the Initial Allocation Period a Reallocation Event will
not be deemed to have occurred if the Gap Ratio is above 25% at the close of business on the previous Index Business Day. For purposes of determining a Reallocation Event, the value of notional call options in the 2004-1 Income 10 Buy-Write Index
will be determined using mid-market implied volatility. 
  
 If the
calculation agent determines that a Reallocation Event has occurred, the calculation agent will determine the Reallocation Percentage (as described below), or the percentage of the 2004-4 Dynamic Portfolio Index’s value that must be allocated
to the 2004-1 Income 10 Buy-Write Index Portfolio pursuant to the reallocation methodology. The Reallocation Percentage will be determined on the basis of values at the close of business on the previous Index Business Day. At the close of business
on the Index Business Day on which a Reallocation Event has occurred, the calculation agent will reallocate the value of the 2004-4 Dynamic Portfolio Index. Reallocations will involve notional sales and purchases of 2004-1 Income 10 Buy-Write Index
units and bond units. The number of 2004-1 Income 10 Buy-Write Index units to be notionally sold or purchased will be determined by the calculation agent at the beginning of each Index Business Day. However, those notional sales or purchases will be
effected at the values (as determined by the calculation agent) of 2004-1 Income 10 Buy-Write Index units and bond units at the close of business on the date of reallocation. Any reallocation on the last day of any quarterly calculation period will
be effected through the notional purchase or sale of 2004-1 Income 10 Buy-Write Index units at a price that includes the notional income on the 2004-1 Income 10 Buy-Write Index for that quarterly calculation period. Notional purchases of 2004-1
Income 10 Buy-Write Index units will be made at prices that reflect the value of notional call options determined using bid-side implied volatility and notional sales of 2004-1 Income 10 Buy-Write Index units will be made at prices that reflect the
value of notional call options determined using offered-side implied volatility. 
  
 If the reallocation results in an increased percentage of the value of the 2004-4 Dynamic Portfolio Index allocated to the 2004-1 Income 10 Buy-Write Index Portfolio, the reallocation will involve the notional sale of
bond units and the notional purchase of 2004-1 Income 10 Buy-Write Index units with the notional proceeds of the sale. Any purchase of 2004-1 Income 10 
  

 8 

 Buy-Write Index units that cannot be effected through the sale of bond units will be effected using the Notional
Participation Facility. The Notional Participation Facility Amount will be increased by the amount necessary to purchase the 2004-1 Income 10 Buy-Write Index units, subject to the cap on the Notional Participation Facility Amount described above. If
the reallocation results in a decreased percentage of the value of the 2004-4 Dynamic Portfolio Index allocated to the 2004-1 Income 10 Buy-Write Index Portfolio, the reallocation will involve the notional sale of 2004-1 Income 10 Buy-Write Index
units. The notional proceeds of this sale will be used first to reduce the Notional Participation Facility Amount to zero and then to make notional purchases of bond units. The number of 2004-1 Income 10 Buy-Write Index units and bond units in the
2004-1 Income 10 Buy-Write Index Portfolio and the Notional Bond Portfolio, respectively, will then be adjusted to reflect the units notionally sold or purchased as a result of the reallocation. 
  
 If at any point during an Index Business Day the value of the Dow Jones
Industrial Average (“DJIA”) declines from its closing value on the previous Index Business Day by 10% or more, the calculation agent, as soon as reasonably practicable, will determine the Reallocation Percentage and reallocate the
value of the 2004-4 Dynamic Portfolio Index so that the percentage of the 2004-4 Dynamic Portfolio Index notionally invested in the 2004-1 Income 10 Buy-Write Index Portfolio is as close as is reasonably practicable to the Reallocation Percentage,
as described above. This reallocation will be effected even if the Gap Ratio has not fallen below 15% and therefore no Reallocation Event has occurred. If the value of the DJIA declines from its closing value on the previous Index Business Day by
10% or more, the calculation agent (unless at the beginning of that index business day the value of the 2004-4 Dynamic Portfolio Index is less than 101% of the Bond Floor) will disregard any Reallocation Event that was determined to have occurred at
the beginning of that Index Business Day and will not make any reallocations with respect to that earlier determination. In addition, in determining the Reallocation Percentage and in effecting any necessary reallocation, the values of the 2004-4
Dynamic Portfolio Index, the 2004-1 Income 10 Buy-Write Index, the 2004-1 Income 10 Buy-Write Index Portfolio and the Bond Floor will be their values at the time the calculation agent calculates the Reallocation Percentage. 
  
 If the value of the 2004-4 Dynamic Portfolio Index is less than 101% of the
Bond Floor at the close of business on any Index Business Day, the entire value of the 2004-4 Dynamic Portfolio Index at the close of business on the following Index Business Day will be reallocated to the Notional Bond Portfolio until the Stated
Maturity Date, even if at the close of business on that day the value of the 2004-4 Dynamic Portfolio Index is greater than 101% of the Bond Floor. This allocation will be effected through a notional sale of all 2004-1 Income 10 Buy-Write Index
units at their value at the close of business on the Index Business Day the reallocation is effected. The notional proceeds from the sale of the 2004-1 Income 10 Buy-Write Index units will be first applied toward reduction of the Notional
Participation Facility Amount to zero. All remaining notional proceeds, if any, will be used to purchase notional bond units at their value at the close of business on the Index Business Day on which the reallocation is effected. 
  

 9 

 The “Gap Ratio” is the ratio of the difference between the value of the 2004-4 Dynamic
Portfolio Index and the Bond Floor and the amount of the 2004-4 Dynamic Portfolio Index allocated to the 2004-1 Income 10 Buy-Write Index Portfolio. The Gap Ratio on any Index Business Day will equal: 
  

	
	 DPIV – BF

	DPIV * BWP

  
 “BF”
is the Bond Floor (as described below) as determined by the calculation agent at the close of business on the previous Index Business Day. 
  
 “BWP” is the percentage of the value of the 2004-4 Dynamic Portfolio Index allocated to the 2004-1 Income 10 Buy- Write Index portfolio
at the close of business on the previous Index Business Day, net of the 2004-4 Dynamic Portfolio Adjustment Factor for that day. 
  
 The Gap Ratio will change in response to changes in the value of the 2004-4 Dynamic Portfolio Index and to changes in interest rates (which affect the
level of the Bond Floor and the value of the Notional Bond Portfolio). If the Gap Ratio is below 15%, the calculation agent will decrease the allocation of the 2004-4 Dynamic Portfolio Index to the 2004-1 Income 10 Buy-Write Index Portfolio. If the
Gap Ratio is above 25%, the calculation agent will increase the allocation of the 2004-4 Dynamic Portfolio Index to the 2004-1 Income 10 Buy-Write Index Portfolio. 
  
 The “Reallocation Percentage” is the percentage of the 2004-4 Dynamic Portfolio Index’s value that
must be allocated to the 2004-1 Income 10 Buy-Write Index Portfolio upon the occurrence of a Reallocation Event or after a decline of 10% or more in the value of the DJIA at any point during an Index Business Day from its closing value on the
previous Index Business Day. The Reallocation Percentage will equal: 
  

							
	5.00 *    	 	[	 	 [PDPIV – BF ]

	 	]
	 	 	PDPIV	 

  
 “PDPIV” is the value of the 2004-4 Dynamic Portfolio Index at the close of business on the previous Index Business Day, net of the Dynamic Portfolio Adjustment Factor for that day. 
  
 The Reallocation Percentage cannot be greater than 150% or less than 0%. If
the Reallocation Percentage is greater than 100%, the notional borrowed funds necessary to make the notional investment in the 2004-1 Income 10 Buy-Write Index portfolio in excess of 100% of the value of the 2004-4 Dynamic Portfolio Index will be
obtained from the Notional Participation Facility. 
  
 The
“Bond Floor” equals the sum of the discounted present values of (i) 100; and (ii) the Dynamic Portfolio Adjustment Factor for each day through and including the fifth Index Business Day before the Stated Maturity Date on a 2004-4
Dynamic Portfolio Index with a value of 100. The component of the Bond Floor equal to 100 will be discounted from the Stated Maturity Date. The component of the Bond Floor equal to the value of the Dynamic Portfolio Adjustment Factor for each day
through and including the fifth Index Business Day before the Stated Maturity Date will be discounted from the day that Dynamic Portfolio Adjustment Factor 
  

 10 

 will be calculated and deducted from the value of the 2004-4 Dynamic Portfolio Index. The calculation agent will
calculate the discount rate: 
  

	 	·	in respect of the component of the Bond Floor equal to 100, using the interpolated yield derived from the U.S. dollar swap rate curve (or U.S. dollar LIBOR rates for maturities of
one year or shorter) interpolated to the Stated Maturity Date; and 

  

	 	·	in respect of the component of the Bond Floor equal to the value of the Dynamic Portfolio Adjustment Factor on a 2004-4 Dynamic Portfolio Index with a value of 100, using the
interpolated yields derived from the U.S. dollar swap rate curve (or U.S. dollar LIBOR rates for maturities of one year or shorter) interpolated based upon the expected timing of the calculation of the Dynamic Portfolio Adjustment Factor

  
 plus a credit spread of 0.08 %, with such
discount rate as provided by Bloomberg Financial Markets or another recognized source selected by the calculation agent on that date. 
  
 If no value of the Bond Floor is available on any date because of a Market Disruption Event or otherwise, unless deferred by the calculation agent as
described above, the value of the Bond Floor will be the arithmetic mean, as determined by the calculation agent, of the value of the Bond Floor obtained from as many dealers in fixed-income securities (which may include Citigroup Global Markets
Inc. or any of the Company’s other subsidiaries or affiliates), but not exceeding three such dealers, as will make such value available to the calculation agent. 
  
 THE 2004-1 INCOME 10 BUY-WRITE INDEX 
  
 The value of the 2004-1 Income 10 Buy-Write Index is calculated at the close of business on each day by Citigroup Global
Markets Inc. as calculation agent. The value of the 2004-1 Income 10 Buy-Write Index was set to equal 100.00 on February 19, 2004. The value of the 2004-1 Income 10 Buy-Write Index at the close of business on September 28, 2004, was $93.07.

  
 The value of the 2004-1 Income 10 Buy-Write Index
(“BWIV”), on each Index Business Day was determined and will continue to be determined according to the following formula: 
  
 BWIV = ITPV – NCOAV + BWNI 
  
 “ITPV” is the value of the 2004-1 Income 10 Portfolio.  
  
 “NCOAV” is the sum of the values of the notional call options relating to the Underlying Stocks (as defined
below). 
  
 “BWNI” is the notional income on the
2004-1 Income 10 Buy-Write Index for that quarterly calculation period, which will be calculated according to the following formula: 
  
 BWNI = ITNI – BWAF 
  
 “ITNI” is the total notional income for all of the Underlying Stocks. 
  

 11 

 “BWAF” is the Income 10 Buy-Write Adjustment Factor. 
  
 The notional income (“NI”) for an Underlying Stock will
generally be calculated in accordance with the following formula, except in the circumstances described below: 
  

													
	NI = PCR *	 	 	 	[	 	AD +	 	 CP * (AATY – HADY)

	 	 	 	]
	 	 	 	 	4	 	 

  
 “PCR”
is the Portfolio Composition Ratio (as defined below) for that Underlying Stock. 
  
 “AD” is the cash dividends per share in respect of that Underlying Stock during that quarterly calculation period. 
  
 “CP” is the Closing Price (as defined below) of that Underlying Stock on the day the notional call option
is priced. 
  
 “AATY” is the adjusted annual
target yield, obtained by increasing the annual target yield (“ATY”) of 10% on the 2004-1 Income 10 Buy-Write Index on the first day of each quarterly calculation period by an amount intended to, but which may or may not, offset the
value of the Income 10 Buy-Write Index Adjustment Factor. The adjusted annual target yield will be calculated as follows: 
  

					
	AATY =	 	 (1 + ATY)

	  	– 1
	 	(1 – BWAFP)	  

  
 “BWAFP” is the Income 10 Buy-Write Adjustment Factor Percentage, which equals 1.65%. 
  
 “HADY” is the historical dividend yield on that Underlying Stock on the first day of that quarterly calculation period. The historical
dividend yield (as determined by the calculation agent) for each Underlying Stock is calculated by annualizing the last quarterly or semi-annual ordinary dividend (as described below) for which the “ex-dividend” date has occurred (or if
the issuer of the Underlying Stock has publicly disclosed that any dividend payable during that quarterly calculation period will be a different amount than such last dividend, the amount publicly disclosed by the issuer), and dividing the result by
the Closing Price of that Underlying Stock on the principal U.S. exchange or market at the close of business on the last Index Business Day of the preceding quarterly calculation period. 
  
 If the highest strike price bid for any option is less than 105% of the Closing Price of the related Underlying Stock on the
day the notional call option is priced, the notional income for that Underlying Stock will be calculated as follows: 
  

											
	NI = PCR *	  	[	  	AD +	  	 CP * (AATY – HADY)

	  	– ATQP	  	]
	  	  	  	4	  	  

  

 12 

 “ATQP” is the difference between the Target Quarterly Premium (as defined below) on the
notional call option relating to that Underlying Stock and the actual quarterly premium (“NCOP”), in respect of that notional call option. ATQP will be calculated as follows: 
  

					
	ATQP   =	 	 CP * (AATY – HADY)

	 	–   NCOP
	 	4	 

  
 The value of the
2004-1 Income 10 Buy-Write Index on any day that is not an Index Business Day will equal the value of the 2004-1 Income 10 Buy-Write Index on the previous day minus the Income 10 Buy-Write Adjustment Factor for that day. 
  
 The value of a cash dividend or distribution will be included in the notional
income on the 2004-1 Income 10 Buy-Write Index (and thus the value of the 2004-1 Income 10 Buy-Write Index) at the close of business on the “ex-dividend” date for that dividend or distribution. The value of premiums in respect of notional
call options will be included in the notional income on the 2004-1 Income 10 Buy-Write Index (and thus the value of the 2004-1 Income 10 Buy-Write Index) at the close of business on the day on which the notional call option is priced. 
  
 The notional income on the 2004-1 Income 10 Buy-Write Index will be removed
from the value of the 2004-1 Income 10 Buy-Write Index at the close of business on the last day of the related quarterly calculation period. 
  
 The “Income 10 Buy-Write Adjustment Factor” will be calculated and subtracted from the notional income on the 2004-1 Income 10 Buy-Write
Index at the end of each day prior to effecting any reallocation that day and will equal: 
  
 PBWV * BWAFP * (1/365) 
  
 “PBWV” is the value of the 2004-1 Income 10 Buy-Write Index at the end of the preceding day. 
  
 “BWAFP” is the Income 10 Buy-Write Adjustment Factor Percentage, which equals 1.65%. 
  
 The value of the Income 10 Buy-Write Adjustment Factor for any quarterly
calculation period will not exceed the value of the notional income on the 2004-1 Income 10 Buy-Write Index for that quarterly calculation period. The value of the Income 10 Buy-Write Adjustment Factor on any day that is not an Index Business Day
will be calculated based on the value of the 2004-1 Income 10 Buy-Write Index on the previous day and will be deducted from the value of the notional income on the 2004-1 Income 10 Buy-Write Index on that day. 
  
 If no value (including a closing value) of the 2004-1 Income 10 Buy-Write
Index is available on any date because of a Market Disruption Event or otherwise, unless deferred by 
  

 13 

 the calculation agent as described above, the calculation agent will determine the values of the components of the 2004-1
Income 10 Buy-Write Index as follows: 
  

	 	•	the value of any Underlying Stock for which no value is available will be the arithmetic mean, as determined by the calculation agent, of the value of that Underlying Stock obtained
from as many dealers in equity securities (which may include Citigroup Global Markets Inc. or any of the Company’s other subsidiaries or affiliates), but not exceeding three such dealers, as will make such value available to the calculation
agent; and 

  

	 	•	the value of any notional call option related to an Underlying Stock for which no value is available will be the arithmetic mean, as determined by the calculation agent, of the
value of that option obtained from as many dealers in options (which may include Citigroup Global Markets Inc. or any of the Company’s other subsidiaries or affiliates), but not exceeding three such dealers, as will make such value available to
the calculation agent. 

  
 CALL OPTIONS 
  
 The calculation agent will price notional cash-settled call options relating
to shares of each of the Underlying Stocks on a quarterly basis, except in the circumstances described below. Notional call options will be priced on the first Index Business Day of each quarterly calculation period. The notional call options for
the first quarterly calculation period were priced on May 20, 2004, the first quarterly calculation period applicable to this Note. The notional call option relating to each Underlying Stock will correlate to the number of shares of that Underlying
Stock used to calculate the 2004-1 Income 10 Portfolio on the day the options are priced. Each notional call option will: 
  

	 	•	expire on the last day of the quarterly calculation period; 

  

	 	•	be automatically settled on the last business day before it expires if the Closing Price of the Underlying Stock exceeds the strike price; and 

  

	 	•	have a strike price greater than or equal to 105% of the Closing Price of the Underlying Stock on the day the notional call option is priced. 

  
 The strike price of each notional call option will be determined through the
bidding process described below. Before seeking bids on the strike price of a notional call option, the calculation agent will determine the “Target Quarterly Premium” for such option, which will equal: 
  

	
	 CP * (AATY – HADY)

	 4

  

 14 

 Once the calculation agent has determined the Target Quarterly Premium for a notional call option, it
will seek strike prices for that notional call option from as many dealers in options (which may include Citigroup Global Markets Inc. or any of the Company’s other subsidiaries or affiliates), but not exceeding five such dealers, as will make
such bid prices available to the calculation agent. The strike price for the notional call option will equal the highest strike price quoted by these dealers and the value of this notional call option and the related Target Quarterly Premium will be
included in the value of the 2004-1 Income 10 Buy-Write Index at close of business on the day the notional call option is priced. If the highest strike price bid is less than 105% of the Closing Price of the related Underlying Stock on the day the
notional call option is priced, the calculation agent will set the strike price of the notional call option at 105% of the Closing Price of the related Underlying Stock on the day the notional call option is priced and will seek quotations for
premiums for the notional call option from as many dealers in options (which may include Citigroup Global Markets Inc. or any of the Company’s other subsidiaries or affiliates), but not exceeding five such dealers, as will make such bid prices
available to the calculation agent. The premium for the notional call option will equal the highest premium quoted by these dealers and the value of this notional call option and the related premium will be included in the value of the 2004-1 Income
10 Buy-Write Index at the close of business on the day the notional call option is priced. 
  
 In seeking strike prices or premiums from dealers in options in respect of notional call options relating to any of the Underlying Stocks, the calculation agent may reject any strike price or premium that does not
meet the requirements for notional call options stated above or that relates to a number of shares of the related Underlying Stock that is different than the number of shares of that Underlying Stock used to calculate the Income 10 Portfolio at the
close of business on the Index Business Day prior to the date on which the options are priced. 
  
 The “Closing Price” of any Underlying Stock on any date will be (1) if the common stock is listed on a national securities exchange on that date of determination, the last reported sale price, regular
way, of the principal trading session on that date on the principal U.S. exchange on which the common stock is listed or admitted to trading, (2) if the common stock is not listed on a national securities exchange on that date of determination, or
if the last reported sale price on such exchange is not obtainable (even if the common stock is listed or admitted to trading on such exchange), and the common stock is quoted on the Nasdaq National Market, the last reported sale price of the
principal trading session on that date as reported on the Nasdaq, and (3) if the common stock is not quoted on the Nasdaq on that date of determination, or if the last reported sale price on the Nasdaq is not obtainable (even if the common stock is
quoted on the Nasdaq), the last reported sale price of the principal trading session on the over-the-counter market on that date as reported on the OTC Bulletin Board, the National Quotation Bureau or a similar organization. If no reported sale
price of the principal trading session is available pursuant to clauses (1), (2) or (3) above or if there is a Market Disruption Event, the trading price on any date of determination, unless deferred by the calculation agent as described in the
preceding sentence, will be the arithmetic mean, as determined by the calculation agent, of the bid prices of the common stock obtained from as many dealers in such stock (which may include Citigroup Global Markets Inc. or any of the Company’s
other subsidiaries or affiliates), but not exceeding three such dealers, as will make such bid prices available to the calculation agent. A security “quoted on the Nasdaq National Market” will include a security included for listing
or quotation in any successor to such system and the term “OTC Bulletin Board” will include any successor to such service. 
  

 15 

 If during any quarterly calculation period the calculation agent removes one of the Underlying Stocks,
all outstanding notional call options in respect of that Underlying Stock will be treated as terminated at the close of business on the day on which the Underlying Stock is removed. At that time, the value of the shares of the removed Underlying
Stock, less the value, if any, of the notional call options in respect of that Underlying Stock, will be reallocated to notional investments in shares (or fractional shares) of the remaining Underlying Stocks. The amount allocated to notional
investments in respect of each remaining Underlying Stock will be in proportion to the percentage of the value of each remaining Underlying Stock relative to the value of the 2004-1 Income 10 Portfolio (less the value of the removed Underlying
Stock) at the close of business on the Index Business Day on which the Underlying Stock is removed. The calculation agent will determine the terms of a new notional call option in respect of each additional share (or fractional share) as described
above. The premium on each additional notional call option will be included in the value of the 2004-1 Income 10 Buy-Write Index at the close of business on the day the option is priced and will be included in the notional income on the 2004-1
Income 10 Buy-Write Index for that quarterly calculation period. 
  
 The terms of the notional call options will provide for adjustments to reflect the occurrence of a corporate or other similar event affecting an Underlying Stock (including, but not limited to a merger or other corporate combination or a
stock split or reverse stock split). 
  
 The mark-to-market value
of each notional call option (“NCOV”) will be determined by the calculation agent at the close of business on each Index Business Day in accordance with a Black-Scholes option pricing formula: 
  
 NCOV = [S * N(d1) * e –(Rd * t)] – [E * N(d2) * e –(Ri * t) ] 
  
 “S” is the Closing Price of the related Underlying Stock as of the time the notional call option is valued. 
  
 “N” is the cumulative normal distribution function (a fixed
statistical function), which determines the probability of a variable falling within a given range under specified conditions. 
  

			
	“d1” is	  	 ln (S / E) + [(Ri – Rd) + (s2 / 2)] * t

	 	  	s * Ö t

  
 “E”
is the strike price of the notional call option. 
  
 “d2” is d1 – [ s * Ö t]. 
  
 “e” is the constant that is the base of the natural logarithm, which equals approximately 2.71828. 
  

 16 

 “Rd” is the computed continuously compounded annualized current dividend yield on the related Underlying Stock. 
  
 “Ri” is the U.S. dollar interest rate as of the time the notional call option is valued, converted into a continuously compounded rate. 
  
 “t” is the time until the expiration of the notional call option as a percentage of one year. 

 
 “ln” is the natural logarithm function. 
  
 “s” is the implied volatility of the related Underlying
Stock (determined by the calculation agent as described below). 
  
 At the time the notional call option is priced, the U.S. dollar interest rate will equal the U.S. dollar LIBOR rate as calculated and published at that time by Bloomberg Financial Markets, or another recognized source selected by the
calculation agent at that time, based on the time to maturity of that notional call option. During the remaining term of the notional call option, the interest rate will equal the published interest rate for a term identical to the remaining term of
the notional call option. If an interest rate for a term identical to the remaining term of the notional call option is not published, the calculation agent will determine the interest rate used to compute the value of an option by interpolating
between the published rate for a shorter term nearest to the term of the notional call option and the published rate for a longer term nearest to the term of the notional call option. All interest rates will be converted by the calculation agent
into a rate compounded on a continuous basis. 
  
 The annualized
current dividend yield for the Underlying Stock on which the option is priced will be calculated on any Index Business Day by dividing the ordinary dividend or dividends historically paid by the issuer of that Underlying Stock during the most recent
period corresponding to the current quarterly calculation period (or if the issuer of the Underlying Stock has publicly disclosed that any dividend payable during the quarterly calculation period in which the notional call option is being priced
will be a different amount than the most recent corresponding historical dividend, the amount publicly disclosed by the issuer) by the Closing Price of that Underlying Stock on the principal U.S. exchange or market on that day and annualizing (based
on a 365-day year) the result to the end of that quarterly calculation period. The annualized current dividend yield for any stock on which an option is priced will be zero: 
  

	 	•	for the reminder of each quarterly calculation period following the ex-dividend date for that stock corresponding to the final ex-dividend date in the most recent period
corresponding to the current quarterly calculation period; and 

  

	 	•	in each quarterly calculation period in which an ordinary dividend has not been payable historically (because the dividend is payable annually, semiannually or otherwise),

  

 17 

 in either case, unless and until the issuer of that stock publicly discloses a dividend payable during the reminder of
that quarterly calculation period, in which case the annualized current dividend yield will be calculated using the amount publicly disclosed by the issuer. 
  
 The implied volatility of a notional call option on any Index Business Day is: 
  

	 	•	when notionally purchasing 2004-1 Income 10 Buy-Write Index units, the bid-side implied volatility; 

  

	 	•	when notionally selling 2004-1 Income 10 Buy-Write Index units, the offered-side implied volatility; and 

  

	 	•	under all other circumstances, the mid-market implied volatility (i.e., the arithmetic mean of the bid-side and offered-side implied volatility) 

  
 of the relevant Underlying Stock as determined by the calculation agent by interpolating from
the implied volatility surface for the most comparable call options listed on the American Stock Exchange (the “AMEX”), the Chicago Board Options Exchange or the International Securities Exchange (or any successor to any such
exchange or any substituted exchange or quotation system to which the listing of comparable call options has temporarily relocated, as determined by the calculation agent) on the relevant Underlying Stock as determined by the calculation agent in
accordance with the Cox-Ross-Rubinstein option pricing model, taking into account the nearest strike price and maturity and using the U.S. dollar interest rate and dividend yield determined as described above. 
  
 If no value of a notional call option is available on any date because of a
Market Disruption Event, because the calculation agent determines that the market for the listed options described above is not sufficiently liquid (based upon factors including, but not limited to, the time elapsed since the last trade in options
relating to that Underlying Stock, the size of the open interest in call options with related strike prices and maturities relating to that Underlying Stock and the size of the bid-offer relative to the number of notional options related to that
Underlying Stock to be priced on that day in respect of the Notes then outstanding) for the purpose of calculating the implied volatility of any notional call option or otherwise, or if the reported prices for the listed options described above
contain or are the result of manifest error, unless deferred by the calculation agent as described below, the value of such notional call option will be the arithmetic mean, as determined by the calculation agent, of the value of such option
obtained from as many dealers in options (which may include Citigroup Global Markets Inc. or any of the Company’s other subsidiaries or affiliates), but not exceeding three such dealers, as will make such value available to the calculation
agent. 
  
 THE 2004-1 INCOME 10 PORTFOLIO 
  
 The “Underlying Stocks” (each an “Underlying
Stock”) are the common stocks included in the 2004-1 Income 10 Portfolio from time to time. The “Underlying Issuers” (each an “Underlying Issuer”) are the issuers of the Underlying Stocks. 
  

 18 

 The Underlying Stocks as of February 19, 2004 are: Altria Group, Inc.; AT&T Corp.; E.I. du Pont de
Nemours and Company; Exxon Mobil Corporation; General Electric Company; General Motors Corporation; International Paper Company; J.P. Morgan Chase & Co.; Merck & Co. Inc.; and SBC Communications Inc. 
  
 The 2004-1 Income 10 Portfolio will be calculated by Citigroup Global Markets
Inc. as calculation agent using an equal dollar-weighting methodology designed to ensure that each of the Underlying Stocks is represented in an approximately equal dollar amount in the 2004-1 Income 10 Portfolio as of February 19, 2004 and as of
each annual reconstitution of the 2004-1 Income 10 Portfolio. 
  
 To create the 2004-1 Income 10 Portfolio, the calculation agent calculated a notional portfolio of the Underlying Stocks representing an investment of $10 in each Underlying Stock at their volume weighted average prices, or VWAP, on
February 19, 2004. Accordingly, each underlying stock initially represented 10% of the value of the 2004-1 Income 10 Portfolio. 
  
 The VWAP of a common stock for any day is the total value of the shares of that stock traded on that stock’s relevant exchange that day divided by
the total number of shares of that stock traded on that stock’s relevant exchange that day. The VWAP of each Underlying Stock for any day will be the price as calculated by Bloomberg Financial Markets using the function “VAP,” or any
successor function, and taking into account all trades of that stock between 9:30 a.m. and 4:00 p.m. New York time on that date or if such price is not so calculated by Bloomberg Financial Markets, then as reported by another recognized source
selected by the calculation agent on that date. 
  
 The value of
the 2004-1 Income 10 Portfolio at any time equals the sum of the products of the current trading price for each Underlying Stock and the Portfolio Composition Ratio (as defined below), of that Underlying Stock. Because the notional portfolio used to
create the 2004-1 Income 10 Portfolio represented investments of $10 in ten stocks, the initial value of the 2004-1 Income 10 Portfolio on February 19, 2004 was 100.00. Its value at the close of business on September 28, 2004 was $93.03. The value
of the 2004-1 Income 10 Portfolio used to calculate the ending value of the 2004-4 Dynamic Portfolio Index will be based on the VWAP of each Underlying Stock on the fifth Index Business Day prior to the Stated Maturity Date. 
  
 The “Portfolio Composition Ratio” for each Underlying Stock
is the number of shares of that Underlying Stock used to calculate the 2004-1 Income 10 Portfolio. 
  
 On each February 19, beginning in 2005, or, if that day is not a Trading Day, on the immediately succeeding Trading Day, the calculation agent will
reconstitute the 2004-1 Income 10 Portfolio to include the ten common stocks in the DJIA with the highest annualized dividend yields (calculated as described above) as of the third Trading Day prior to that date. These stocks will be the Underlying
Stocks until the next annual rebalancing. If two common stocks in the DJIA have the same annualized dividend yield as of the third Trading Day prior to the reconstitution date, the common stock with the higher free-float market capitalization will
be given the higher ranking. If Citigroup Inc. (or any of its affiliates) or any entity organized as a real estate investment trust is one of the ten common stocks in the DJIA with the highest 
  

 19 

 annualized dividend yields as of the third Trading Day prior to the reconstitution date, that common stock will not be
included in the 2004-1 Income 10 Portfolio and the calculation agent will instead include the common stock in the DJIA with the highest annualized dividend yield of those stocks not already included in the 2004-1 Income 10 Portfolio. 
  
 The calculation agent will include in the 2004-1 Income 10 Portfolio only
stocks that meet the following criteria: (1) each Underlying Stock must have a minimum market value of at least $75 million, except that up to 10% of the Underlying Stocks may have a market value of $50 million; (2) each Underlying Stock must have
an average monthly trading volume in the preceding six months of not less than 1,000,000 shares, except that up to 10% of the Underlying Stocks may have an average monthly trading volume of 500,000 shares or more in the last six months; (3) 90% of
the 2004-1 Income 10 Portfolio’s numerical index value and at least 80% of the total number of Underlying Stocks will meet the then current criteria for standardized option trading set forth in the rules of the AMEX; and (4) all Underlying
Stocks will either be listed on the AMEX, the New York Stock Exchange (the “NYSE”), or traded through the facilities of the Nasdaq National Market and reported as National Market System Securities. 
  
 After reconstituting the 2004-1 Income 10 Portfolio for the next year, the
calculation agent will rebalance the 2004-1 Income 10 Portfolio and set Portfolio Composition Ratios so that each Underlying Stock represents approximately 10% of the value of the 2004-1 Income 10 Portfolio based on the Closing Prices of the
Underlying Stocks as of the reconstitution date. This reconstituted and rebalanced portfolio will become the basis for the value of the Income 10 Portfolio on the following Trading Day. 
  
 A “Trading Day” means a day, as determined by the calculation agent, on which trading is generally
conducted (or was scheduled to have been generally conducted, but for the occurrence of a Market Disruption Event) on the NYSE, the AMEX, the Nasdaq National Market, the Chicago Mercantile Exchange and the Chicago Board Options Exchange, and in the
over-the-counter market for equity securities in the United States. 
  
 An Underlying Stock will be removed from the 2004-1 Income 10 Portfolio if, at any time, it: 
  
 (1) has a market value of less than $50 million; 
  
 (2) has an average monthly trading volume in the preceding six months of less than 500,000 shares; or 
  
 (3) is not listed on the AMEX, the NYSE, or is not traded through the
facilities of the National Association of Securities Dealers Automated Quotation System and is not reported among National Market System Securities. 
  

 20 

 An Underlying Stock will also be removed if at any time the issuer of that Underlying Stock: 

 
 (1) commences a voluntary case under any applicable bankruptcy,
insolvency or other similar law, or consents to the entry of an order for relief in an involuntary case under any such law; 
  
 (2) has entered against it by a court having jurisdiction in the premises (x) an order for relief in an involuntary case or proceeding under any
applicable bankruptcy, insolvency or other similar law or (y) an order adjudging it bankrupt or insolvent under such law; or 
  
 (3) commences a voluntarily winding up, liquidation, dissolution or other discontinuance of its corporate existence (except in the context of a merger or
other acquisition) or consents to the entry of an order for relief in an involuntary case requiring any such action. 
  
 If the calculation agent determines that an Underlying Stock must be removed from the 2004-1 Income 10 Portfolio pursuant to the above criteria, the
removal of that Underlying Stock will be effected at the close of business on the Index Business Day on which that determination is made. 
  
 ADJUSTMENTS TO THE PORTFOLIO COMPOSITION RATIOS 
  
 If any notional call option included in the 2004-1 Income 10 Buy-Write Index has a value greater than zero at expiration, the value of that option will be
removed from the value of the 2004-1 Income 10 Buy-Write Index at the close of business on the day the option expires. In order to preserve the continuity of the value of the 2004-1 Income 10 Buy-Write Index following any such removal, the value of
the related Underlying Stock in the 2004-1 Income 10 Portfolio will at the same time be reduced by an amount equal to the value of the option at expiration. This reduction will be effected by decreasing the Portfolio Composition Ratio of the related
Underlying Stock by an amount that, when multiplied by the Closing Price of the related Underlying Stock on the last Index Business Day of the quarterly calculation period, equals the value of the option at expiration. The Portfolio Composition
Ratio for the related Underlying Stock will be reduced by an amount calculated as follows: 
  

							
	 PCR *
	  	 ( 1 –
	 	 NCOSP

	 	 )

	  	 	    EP	 

  
 “NCOSP” is the strike price of the notional call option relating to that Underlying Stock. 
  
 “EP” is the Closing Price of the related Underlying Stock on the last Index Business Day of that quarterly calculation period.

  
 The reduced Portfolio Composition Ratio will be used to
calculate the value of the 2004-1 Income 10 Portfolio on the following Index Business Day. 
  
 If any Underlying Issuer, after the closing date of the offering of the Notes: 
  
 (1) pays a stock dividend or makes a distribution with respect to its common stock in shares of the stock; 
  

 21 

 (2) subdivides or splits the outstanding shares of its common stock into a greater number of shares;

  
 (3) combines the outstanding shares of its common stock into a
smaller number of shares; or 
  
 (4) issues by reclassification of
shares of its common stock any shares of other common stock of the Underlying Issuer; 
  
 then, in each of these cases, the Underlying Stock’s Portfolio Composition Ratio will be multiplied by a dilution adjustment equal to a fraction, the numerator of which will be the number of shares of common
stock outstanding immediately after the event, plus, in the case of a reclassification referred to in (4) above, the number of shares of other common stock of the Underlying Issuer, and the denominator of which will be the number of shares of common
stock outstanding immediately before the event. 
  
 If any
Underlying Issuer, after the closing date, issues, or declares a record date in respect of an issuance of, rights or warrants to all holders of its common stock entitling them to subscribe for or purchase the common stock at a price per share less
than the Then-Current Market Price of the common stock, other than rights to purchase common stock pursuant to a plan for the reinvestment of dividends or interest, then, in each case, the Portfolio Composition Ratio for that Underlying Stock will
be multiplied by a dilution adjustment equal to a fraction, the numerator of which will be the number of that issuer’s common stock outstanding immediately before the adjustment is effected, plus the number of additional shares of stock of that
issuer offered for subscription or purchase pursuant to the rights or warrants, and the denominator of which will be the number of that issuer’s common stock outstanding immediately before the adjustment is effected by reason of the issuance of
the rights or warrants, plus the number of additional shares of common stock of that issuer which the aggregate offering price of the total number of shares of that issuer’s common stock offered for subscription or purchase pursuant to the
rights or warrants would purchase at the Then-Current Market Price of the common stock, which will be determined by multiplying the total number of shares so offered for subscription or purchase by the exercise price of the rights or warrants and
dividing the product obtained by the Then-Current Market Price. To the extent that, after the expiration of the rights or warrants, the shares of common stock offered thereby have not been delivered, the Portfolio Composition Ratio for that
Underlying Stock will be further adjusted to equal the Portfolio Composition Ratio which would have been in effect had the adjustment for the issuance of the rights or warrants been made upon the basis of delivery of only the number of shares of
common stock actually delivered. 
  
 If any Underlying Issuer,
after the closing date, declares or pays a dividend or makes a distribution to all holders of the common stock of any class of its common stock, evidences of its indebtedness or other non-cash assets, excluding any dividends or distributions
referred to in the above paragraph, or issues to all holders of its common stock rights or warrants to subscribe for or purchase any of its securities or one or more of its subsidiaries’ securities, other than rights or warrants referred to in
the above paragraph, then, in each of these cases, the Portfolio Composition Ratio for that Underlying Stock will be multiplied by a dilution adjustment equal to 
  

 22 

 a fraction, the numerator of which will be the Then-Current Market Price of one share of the Underlying Stock, and the
denominator of which will be the Then-Current Market Price of one share of the Underlying Stock, less the fair market value (as determined by a nationally recognized independent investment banking firm retained for this purpose by the Company, whose
determination will be final) as of the time the adjustment is effected of the portion of the capital stock, assets, evidences of indebtedness, rights or warrants so distributed or issued applicable to one share of the Underlying Stock. 

 
 Notwithstanding the foregoing, in the event, with respect to any dividend
or distribution to which the above paragraph would otherwise apply, the denominator in the fraction referred to in the above formula is less than $1.00 or is a negative number, then the Company may, at its option, elect to have the adjustment
provided by the above paragraph not be made and in lieu of this adjustment, at maturity, each holder of the Notes will be entitled to receive an additional amount of cash equal to the product of the number of Notes held by the holder multiplied by
the fair market value of the capital stock, indebtedness, assets, rights or warrants (determined, as of the date this dividend or distribution is made, by a nationally recognized independent investment banking firm retained for this purpose by the
Company, whose determination will be final) so distributed or issued applicable to a number of shares of the Underlying Stock equal to the Portfolio Composition Ratio. 
  
 If, after the closing date, any Underlying Issuer makes an Excess Purchase Payment, then the Portfolio Composition Ratio for
the Underlying Stock will be multiplied by a dilution adjustment equal to a fraction, the numerator of which will be the Then-Current Market Price of the Underlying Stock, and the denominator of which will be the Then-Current Market Price of the
Underlying Stock on the record date less the aggregate amount of such Excess Purchase Payment for which adjustment is being made at the time divided by the number of shares of common stock outstanding on the record date. 
  
 For purposes of these adjustments: 
  
 An “Excess Purchase Payment” is the excess, if any, of (x)
the cash and the value (as determined by a nationally recognized independent investment banking firm retained for this purpose by the Company, whose determination will be final) of all other consideration paid by the Underlying Issuer with respect
to one share of its common stock acquired in a tender offer or exchange offer by the Underlying Issuer, over (y) the Then-Current Market Price of the Underlying Stock. 
  
 Notwithstanding the foregoing, in the event, with respect to any Excess Purchase Payment to which the sixth paragraph in
this section would otherwise apply, the denominator in the fraction referred to in the formula in that paragraph is less than $1.00 or is a negative number, then the Company may, at its option, elect to have the adjustment provided by the sixth
paragraph in this section not be made and in lieu of this adjustment, at maturity, the holders of the Notes will be entitled to receive an additional amount of cash equal to the product of the number of Notes held by the holder multiplied by the sum
of the amount of cash plus the fair market value of other consideration (determined, as of the date this dividend or distribution is made, by a nationally recognized independent investment banking firm retained for this purpose 
  

 23 

 by the Company, whose determination will be final) so distributed or applied to the acquisition of the Underlying Stock
in the tender offer or exchange offer applicable to a number of shares of the Underlying Stock equal to the Portfolio Composition Ratio. 
  
 Each dilution adjustment will be effected as follows: 
  

	 	•	in the case of any dividend, distribution or issuance, at the opening of business on the Business Day next following the record date for determination of holders of the applicable
Underlying Stock entitled to receive this dividend, distribution or issuance or, if the announcement of this dividend, distribution or issuance is after this record date, at the time this dividend, distribution or issuance was announced by the
Underlying Issuer; 

  

	 	•	in the case of any subdivision, split, combination or reclassification, on the effective date of the transaction; 

  

	 	•	in the case of any Excess Purchase Payment for which the Underlying Issuer announces, at or prior to the time it commences the relevant share repurchase, the repurchase price per
share for shares proposed to be repurchased, on the date of the announcement; and 

  

	 	•	in the case of any other Excess Purchase Payment, on the date that the holders of the repurchased shares become entitled to payment in respect thereof. 

  
 All dilution adjustments will be rounded upward or downward to the nearest
1/10,000th or, if there is not a nearest 1/10,000th, to the next lower 1/10,000th. No adjustment to any Portfolio Composition Ratio will be required unless the adjustment would require an increase or decrease of at least one percent therein,
provided, however, that any adjustments which by reason of this sentence are not required to be made will be carried forward (on a percentage basis) and taken into account in any subsequent adjustment. If any announcement or declaration of a record
date in respect of a dividend, distribution, issuance or repurchase requiring an adjustment as described herein is subsequently canceled by the Underlying Issuer, or this dividend, distribution, issuance or repurchase fails to receive requisite
approvals or fails to occur for any other reason, then, upon the cancellation, failure of approval or failure to occur, the Portfolio Composition Ratio will be further adjusted to the Portfolio Composition Ratio which would then have been in effect
had adjustment for the event not been made. If a Reorganization Event described below occurs after the occurrence of one or more events requiring an adjustment as described herein, the dilution adjustments previously applied to the Portfolio
Composition Ratio will not be rescinded but will be applied to the new Portfolio Composition Ratio provided for below. 
  
 The “Then-Current Market Price” of any Underlying Stock, for the purpose of applying any dilution adjustment, means the average Closing
Price of one share of that Underlying Stock for the ten Trading Days immediately before this adjustment is effected or, in the case of an adjustment effected at the opening of business on the Business Day next following a record date, immediately
before the earlier of the date the adjustment is effected and the related Ex-Date. 
  

 24 

 The “Ex-Date” with respect to any dividend, distribution or issuance is the first date
on which the Underlying Stock trades in the regular way on its principal market without the right to receive this dividend, distribution or issuance. 
  
 In the event of any of the following “Reorganization Events”: 
  

	 	•	any consolidation or merger of an Underlying Issuer, or any surviving entity or subsequent surviving entity of an Underlying Issuer, with or into another entity, other than a merger
or consolidation in which an Underlying Issuer is the continuing corporation and in which the common stock outstanding immediately before the merger or consolidation is not exchanged for cash, securities or other property of the Underlying Issuer or
another issuer; 

  

	 	•	any sale, transfer, lease or conveyance to another corporation of the property of an Underlying Issuer or any successor as an entirety or substantially as an entirety;

  

	 	•	any statutory exchange of securities of an Underlying Issuer or any successor of an Underlying Issuer with another issuer, other than in connection with a merger or acquisition; or

  

	 	•	any liquidation, dissolution or winding up of an Underlying Issuer or any successor of an Underlying Issuer; 

  
 the value of that Underlying Stock will be calculated by multiplying the then-existing
Portfolio Composition Ratio for that Underlying Stock by the Transaction Value. If a Reorganization Event occurs, no adjustment will be made to the Portfolio Composition Ratio of the relevant Underlying Stock. 
  
 The “Transaction Value” will be the sum of: 
  
 (1) for any cash received in a Reorganization Event, the amount of cash
received per Underlying Stock; 
  
 (2) for any property other than
cash or Marketable Securities received in a Reorganization Event, an amount equal to the market value on the date the Reorganization Event is consummated of that property received per Underlying Stock, as determined by a nationally recognized
independent investment banking firm retained for this purpose by the Company, whose determination will be final; and 
  
 (3) for any Marketable Securities received in a Reorganization Event, an amount equal to the Closing Price per share of these Marketable Securities on the
applicable Trading Day multiplied by the number of these Marketable Securities received for each share of that Underlying Stock. 
  

 25 

 “Marketable Securities” are any perpetual equity securities or debt securities with a
stated maturity after the Stated Maturity Date, in each case that are listed on a U.S. national securities exchange or reported by the Nasdaq Stock Market. The number of shares of any equity securities constituting Marketable Securities included in
the calculation of Transaction Value pursuant to clause (3) above will be adjusted if any event occurs with respect to the Marketable Securities or the issuer of the Marketable Securities between the time of the Reorganization Event and maturity
that would have required an adjustment as described above, had it occurred with respect to any Underlying Stock or to an Underlying Issuer. Adjustment for these subsequent events will be as nearly equivalent as practicable to the adjustments
described above. 
  
 If the calculation agent removes an
Underlying Stock from the 2004-1 Income 10 Portfolio, at the close of business on the day the Underlying Stock is removed, the value of the shares of that Underlying Stock in the 2004-1 Income 10 Portfolio, less the value, if any, of any notional
call options in respect of that Underlying Stock, will be reallocated to notional investments in shares (or fractional shares) of the remaining Underlying Stocks. The amount allocated to notional investments in respect of each remaining Underlying
Stock will be in proportion to the percentage of the value of each remaining Underlying Stock relative to the value of the 2004-1 Income 10 Portfolio (less the value of the removed stock) at the close of business on the Index Business Day on which
the Underlying Stock is removed. The Portfolio Composition Ratio of each remaining Underlying Stock will be increased to reflect the number of shares (or fractional shares) that could be purchased at the Closing Price of such remaining Underlying
Stock on that Index Business Day. 
  
 If at any time Citigroup
Inc., on a consolidated basis, is the beneficial owner of 8% or more of any Underlying Stock, the calculation agent will, as soon as practicable, reduce the Portfolio Composition Ratio of that Underlying Stock by the following percentage:

  

					
	 	 	 SH(a) – SH(b)

	 	 
	 	 	SH(a)	 	 

  
 “SH(a)” is the number of shares of stock of that Underlying Issuer held by Citigroup Inc. and its affiliates at the time of the rebalancing. 
  
 “SH(b)” is the number of shares representing 7.5% of the outstanding shares of that class of stock (as
determined by the calculation agent). References to a class of stock for these purposes will be as made in Section 13(d) of the Securities Exchange Act of 1934, as amended, for purposes of determining beneficial ownership. 
  
 The value of the number of shares by which the Underlying Stock’s
Portfolio Composition Ratio is reduced will be reallocated equally to notional investments in the other Underlying Stocks. The Portfolio Composition Ratio of each of those stocks will increase by the number of shares that notional investment would
purchase at the Underlying Stock’s Closing Price on the Trading Day on which the reallocation is effected. 
  

 26 

 GENERAL 
  
 This Note is one of a duly authorized issue of debt securities of the Company (the “Debt Securities”),
issued and to be issued in one or more series under a Senior Debt Indenture, dated as of October 27, 1993, as supplemented by a First Supplemental Indenture, dated as of November 28, 1997, a Second Supplemental Indenture, dated as of July 1, 1999,
and as further supplemented from time to time (the “Indenture”), between the Company and The Bank of New York, as Trustee (the “Trustee”, which term includes any successor trustee under the Indenture), to which
Indenture reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the holders of the Notes, and the terms upon which the Notes are, and are to be,
authenticated and delivered. 
  
 If an Event of Default with
respect to the Notes shall have occurred and be continuing, the principal of the Notes may be declared due and payable in the manner and with the effect provided in the Indenture. In such case, the amount declared due and payable upon any
acceleration permitted by the Indenture will be determined by the calculation agent and will be equal to, with respect to this Note, the Maturity Payment calculated as though the Stated Maturity Date of this Note were the date of early repayment. In
case of default at Maturity of this Note, this Note shall bear interest, payable upon demand of the beneficial owners of this Note in accordance with the terms of the Notes, from and after Maturity through the date when payment of such amount has
been made or duly provided for, at the rate of 4.50% per annum on the unpaid amount due. 
  
 The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the holders of the Debt Securities of each
series to be affected under the Indenture at any time by the Company and a majority in aggregate principal amount of the Debt Securities at the time Outstanding of each series affected thereby. The Indenture also contains provisions permitting the
holders of specified percentages in aggregate principal amount of the Debt Securities of any series at the time Outstanding, on behalf of the holders of all Debt Securities of such series, to waive compliance by the Company with certain provisions
of the Indenture and certain past defaults under the Indenture and their consequences. Any such consent or waiver by the holder of this Note shall be conclusive and binding upon such holder and upon all future holders of this Note and of any Note
issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note. 
  
 The holder of this Note may not enforce such holder’s rights pursuant to the Indenture or the Notes except as provided
in the Indenture. No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company to pay the Maturity Payment with respect to this Note, and to pay any interest on any
overdue amount thereof at the time, place and rate, and in the coin or currency, herein prescribed. 
  
 All terms used in this Note which are defined in the Indenture but not in this Note shall have the meanings assigned to them in the Indenture. 

 

 27 

 Unless the certificate of authentication hereon has been executed by the Trustee by manual signature,
this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purposes. 
  

 28 

 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed under its corporate seal.

  

			
	 CITIGROUP GLOBAL MARKETS HOLDINGS INC.

		
	 By:
	 	 /S/    SCOTT FREIDENRICH

	 Name:
	 	 Scott Freidenrich

	 Title:
	 	 Executive Vice President and Treasurer

  
 Corporate Seal Attest: 
  

			
	 By:
	 	 /S/    DOUGLAS C. TURNBULL

	 Name:
	 	 Douglas C. Turnbull

	 Title:
	 	 Assistant Secretary

	
	 Dated: October 5, 2004

	
	 CERTIFICATE OF AUTHENTICATION

	 	 	 This is one of the Notes referred to in

	 	 	 the within-mentioned Indenture.

	
	 The Bank of New York,

	 as Trustee

		
	 By:
	 	 /S/    GEOVANNI BARRIS

	 	 	 Authorized Signatory

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00072-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00072-of-00352.parquet"}]]