Document:

Form of Preferred Capital Securities Guarantee Agreement

  
 Exhibit 4.20

  
 FORM OF 
 GUARANTEE AGREEMENT 
  
 Between 
  
 [HOMEBANC CORP.][HOMEBANC MORTGAGE CORPORATION] 
 as Guarantor, 

 
 and 
  
 WILMINGTON TRUST COMPANY 
 as Guarantee Trustee, 
  
 Dated as of [Closing Date] 

 HMB CAPITAL TRUST [    ] 
  
 Certain Sections of this Guarantee Agreement relating to 
 Sections 310 through 318 of the 
 Trust Indenture Act of 1939: 
  
 (i)
            Trust Indenture             Guarantee Agreement 
  

					
	 Act Section

	  	 	  	Section

	 Section 310
	  	 (a) (1)
	  	4.1 (a)
	 	  	 (a) (2)
	  	4.1 (a)
	 	  	 (a) (3)
	  	Not Applicable
	 	  	 (a) (4)
	  	Not Applicable
	 	  	 (b)
	  	2.8, 4.1 (c)
	 Section 311
	  	 (a)
	  	Not Applicable
	 	  	 (b)
	  	Not Applicable
	 Section 312
	  	 (a)
	  	2.2 (a)
	 	  	 (b)
	  	2.2 (b)
	 	  	 (c)
	  	Not Applicable
	 Section 313
	  	 (a)
	  	2.3
	 	  	 (a) (4)
	  	2.3
	 	  	 (b)
	  	2.3
	 	  	 (c)
	  	2.3
	 	  	 (d)
	  	2.3
	 Section 314
	  	 (a)
	  	2.4
	 	  	 (b)
	  	2.4
	 	  	 (c) (1)
	  	2.5
	 	  	 (c) (2)
	  	2.5
	 	  	 (c) (3)
	  	2.5
	 	  	 (e)
	  	1.1, 2.5, 3.2
	 Section 315
	  	 (a)
	  	3.1 (d)
	 	  	 (b)
	  	2.7
	 	  	 (c)
	  	3.1 (c)
	 	  	 (d)
	  	3.1 (d)
	 	  	 (e)
	  	Not Applicable
	 Section 316
	  	 (a)
	  	1.1, 2.6, 5.4
	 	  	 (a) (1) (A)
	  	5.4
	 	  	 (a) (1) (B)
	  	5.4
	 	  	 (a) (2)
	  	Not Applicable
	 	  	 (b)
	  	5.3
	 	  	 (c)
	  	Not Applicable
	 Section 317
	  	 (a) (1)
	  	Not Applicable
	 	  	 (a) (2)
	  	Not Applicable
	 	  	 (b)
	  	Not Applicable
	 Section 318
	  	 (a)
	  	2.1

  
 Note: This reconciliation and tie
shall not, for any purpose, be deemed to be a part of the Guarantee Agreement. 
  

 - i - 

 TABLE OF CONTENTS 
  

					
	 ARTICLE I. DEFINITIONS
	  	2
	 SECTION 1.1.
	  	 Definitions
	  	2
		
	 ARTICLE II. TRUST INDENTURE ACT
	  	5
	 SECTION 2.1.
	  	 Trust Indenture Act; Application
	  	5
	 SECTION 2.2.
	  	 List of Holders
	  	5
	 SECTION 2.3.
	  	 Reports by the Guarantee Trustee
	  	5
	 SECTION 2.4.
	  	 Periodic Reports to the Guarantee Trustee
	  	5
	 SECTION 2.5.
	  	 Evidence of Compliance with Conditions Precedent
	  	6
	 SECTION 2.6.
	  	 Events of Default; Waiver
	  	6
	 SECTION 2.7.
	  	 Event of Default; Notice
	  	6
	 SECTION 2.8.
	  	 Conflicting Interests
	  	6
		
	 ARTICLE III. POWERS, DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE
	  	7
	 SECTION 3.1.
	  	 Powers and Duties of the Guarantee Trustee
	  	7
	 SECTION 3.2.
	  	 Certain Rights of Guarantee Trustee
	  	8
	 SECTION 3.3.
	  	 Indemnity
	  	10
	 SECTION 3.4.
	  	 Expenses
	  	10
		
	 ARTICLE IV. GUARANTEE TRUSTEE
	  	10
	 SECTION 4.1.
	  	 Guarantee Trustee; Eligibility
	  	10
	 SECTION 4.2.
	  	 Appointment, Removal and Resignation of the Guarantee Trustee
	  	11
		
	 ARTICLE V. GUARANTEE
	  	12
	 SECTION 5.1.
	  	 Guarantee
	  	12
	 SECTION 5.2.
	  	 Waiver of Notice and Demand
	  	12
	 SECTION 5.3.
	  	 Obligations Not Affected
	  	12
	 SECTION 5.4.
	  	 Rights of Holders
	  	13
	 SECTION 5.5.
	  	 Guarantee of Payment
	  	13
	 SECTION 5.6.
	  	 Subrogation
	  	13
	 SECTION 5.7.
	  	 Independent Obligations
	  	14
		
	 ARTICLE VI. COVENANTS AND SUBORDINATION
	  	14
	 SECTION 6.1.
	  	 Subordination
	  	14
	 SECTION 6.2.
	  	 Pari Passu Guarantees
	  	14
		
	 ARTICLE VII. TERMINATION
	  	14
	 SECTION 7.1.
	  	 Termination
	  	14
		
	 ARTICLE VIII. MISCELLANEOUS
	  	15
	 SECTION 8.1.
	  	 Successors and Assigns
	  	15
	 SECTION 8.2.
	  	 Amendments
	  	15
	 SECTION 8.3.
	  	 Notices
	  	15
	 SECTION 8.4.
	  	 Benefit
	  	16
	 SECTION 8.5.
	  	 Interpretation
	  	17
	 SECTION 8.6.
	  	 Governing Law
	  	17
	 SECTION 8.7.
	  	 Counterparts
	  	17

  

 - ii - 

  
 GUARANTEE AGREEMENT

  
 THIS GUARANTEE AGREEMENT, dated as of [Closing Date], is
executed and delivered by [HOMEBANC CORP., a Georgia corporation][HOMEBANC MORTGAGE CORPORATION, a Delaware Corporation] (the “Guarantor”), having its principal office at 2002 Summit Boulevard, Atlanta, Georgia, 30319, and
WILMINGTON TRUST COMPANY, a Delaware banking corporation, as trustee (the “Guarantee Trustee”), for the benefit of the Holders (as defined herein) from time to time of the Preferred Capital Securities (as defined herein) of HMB
CAPITAL TRUST [        ], a Delaware statutory trust (the “Issuer Trust”). 
  
 Pursuant to an Amended and Restated Declaration of Trust (the “Amended Declaration”), dated of even date herewith, among [HomeBanc
Corp.][HomeBanc Mortgage Corporation], as Depositor, Wilmington Trust Company, as Property Trustee (the “Property Trustee”), Wilmington Trust Company, as Delaware Trustee (the “Delaware Trustee,” and together with
the Property Trustee, collectively, the “Issuer Trustees”), the Administrators named therein and the Holders from time to time of undivided beneficial interests in the assets of the Issuer Trust, the Issuer Trust is issuing up to
$[Amount] aggregate Liquidation Amount (as defined herein) of its Preferred Capital Securities (the “Preferred Capital Securities”), representing preferred undivided beneficial interests in the assets of the Issuer Trust and having
the terms set forth in the Amended Declaration; 
  
 The Preferred
Capital Securities will be issued by the Issuer Trust and the proceeds thereof, together with the proceeds from the issuance of the Issuer Trust’s Common Securities (the “Common Securities”), representing common undivided
beneficial interests in the assets of the Issuer Trust, to the Guarantor, will be used to purchase the Junior Subordinated Debentures due [Maturity Date] (the “Junior Subordinated Debentures”) of the Guarantor, which will be
deposited with Wilmington Trust Company, as Property Trustee under the Amended Declaration, as trust assets; and 
  
 As an inducement to the Holders to purchase the Preferred Capital Securities, the Guarantor is willing to irrevocably and unconditionally agree, to the
extent set forth herein, to pay to the Holders of the Preferred Capital Securities the Guarantee Payments (as defined herein) and to make certain other payments on the terms and conditions set forth herein. 
  
 NOW, THEREFORE, in consideration of the purchase of the Preferred Capital
Securities by each Holder, which purchase the Guarantor hereby acknowledges shall benefit the Guarantor, the Guarantor, intending to be legally bound hereby, executes and delivers this Guarantee Agreement for the benefit of the Holders from time to
time of the Preferred Capital Securities. 

  
 ARTICLE I. DEFINITIONS

  
 SECTION 1.1. Definitions. 
  
 As used in this Guarantee Agreement, the terms set forth below shall have the
following meanings. Capitalized terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Amended Declaration. 
  
 “Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person. For the purposes of this definition, “control” when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing. 
  
 “Amended Declaration” has the meaning specified in the recitals hereto. 
  
 “Event of Default” means (i) a default by the Guarantor in
any of its payment obligations under this Guarantee Agreement, or (ii) a default by the Guarantor in any other obligation hereunder that remains unremedied for 30 days. 
  
 “Guarantee Agreement” means this Guarantee Agreement, as modified, amended or supplemented from time to
time. 
  
 “Guarantee Payments” means the
following payments or distributions, without duplication, with respect to the Preferred Capital Securities, to the extent not paid or made by or on behalf of the Issuer Trust: (i) any accumulated and unpaid Distributions (as defined in the Amended
Declaration) required to be paid on the Preferred Capital Securities, to the extent the Issuer Trust shall have funds on hand available therefor at such time, (ii) the Redemption Price, with respect to the Preferred Capital Securities called for
redemption by the Issuer Trust to the extent that the Issuer Trust shall have funds on hand available therefor at such time, and (iii) upon a voluntary or involuntary dissolution, termination, winding-up or liquidation of the Issuer Trust, unless
the Junior Subordinated Debentures are distributed to the Holders, the lesser of (a) the aggregate of the Liquidation Amount of all outstanding Trust Securities and all accumulated and unpaid Distributions to the date of payment to the extent the
Issuer Trust shall have funds on hand available to make such payment at such time and (b) the amount of assets of the Issuer Trust remaining available for distribution to Holders on liquidation of the Issuer Trust (in either case, the
“Liquidation Distribution”). 
  
 “Guarantee Trustee” means Wilmington Trust Company, until a Successor Guarantee Trustee has been appointed and has accepted such appointment pursuant to the terms of this Guarantee Agreement and thereafter means each such
Successor Guarantee Trustee. 
  

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 “Guarantor” shall have the meaning specified in the first paragraph of this Guarantee
Agreement. 
  
 “Holder” means any holder, as
registered on the books and records of the Issuer Trust, of any Preferred Capital Securities; provided, however, that, in determining whether the holders of the requisite percentage of Preferred Capital Securities have given any request,
notice, consent or waiver hereunder, “Holder” shall not include the Guarantor, the Guarantee Trustee, or any Affiliate of the Guarantor or the Guarantee Trustee. 
  
 “Indenture” means the Subordinated Indenture, dated as of
[                    , 20    ], between [HomeBanc Corp.][HomeBanc Mortgage Corporation] and U.S. Bank, National
Association, as trustee, as it may be modified, amended or supplemented from time to time to provide for the Junior Subordinated Indentures. 
  
 “Issuer Trust” shall have the meaning specified in the first paragraph of this Guarantee Agreement. 
  
 “Like Amount” means (a) with respect to a redemption of
Trust Securities, Trust Securities having a Liquidation Amount equal to that portion of the principal amount of Junior Subordinated Debentures to be contemporaneously redeemed in accordance with the Indenture, allocated to the Common Securities and
to the Preferred Capital Securities based upon the relative Liquidation Amounts of such classes and (b) with respect to a distribution of Junior Subordinated Debentures to Holders of Trust Securities in connection with a dissolution or liquidation
of the Issuer Trust, Junior Subordinated Debentures having a principal amount equal to the Liquidation Amount of the Trust Securities of the Holder to whom such Junior Subordinated Debentures are distributed. 
  
 “Liquidation Amount” means the stated amount of
$[                ] per Preferred Capital Security and $[                ]
per Common Security. 
  
 “Majority in Liquidation Amount
of the Preferred Capital Securities” means, except as provided by the Trust Indenture Act, Preferred Capital Securities representing more than 50% of the aggregate Liquidation Amount of all then outstanding Preferred Capital Securities
issued by the Issuer Trust. 
  
 “Officers’
Certificate” means a certificate signed by the Chairman of the Board, Vice Chairman of the Board, Chief Executive Officer, President, Executive Vice President or a Senior Vice President or Vice President, and by the Treasurer, an Assistant
Treasurer, the Chief Financial Officer, the Secretary or an Assistant Secretary of the Guarantor, and delivered to the Guarantee Trustee. Any Officers’ Certificate delivered with respect to compliance with a condition or covenant provided for
in this Guarantee Agreement shall include: 
  
 (a) a statement by
each officer signing the Officers’ Certificate that such officer has read the covenant or condition and the definitions relating thereto; 
  

 3 

 (b) a brief statement of the nature and scope of the examination or investigation undertaken by such
officer in rendering the Officers’ Certificate; 
  
 (c) a
statement that such officer has made such examination or investigation as, in such officer’s opinion, is necessary to enable such officer to express an informed opinion as to whether or not such covenant or condition has been complied with; and

  
 (d) a statement as to whether, in the opinion of such officer,
such condition or covenant has been complied with. 
  
 “Person” means a legal person, including any individual, corporation, estate, partnership, joint venture, association, joint stock company, limited liability company, trust, unincorporated association, or government or any
agency or political subdivision thereof, or any other entity of whatever nature. 
  
 “Redemption Date” means, with respect to any Preferred Capital Security to be redeemed, the date fixed for such redemption by or pursuant to the Amended Declaration; provided that each
Debenture Redemption Date and the stated maturity of the Junior Subordinated Debentures shall be a Redemption Date for a Like Amount of Preferred Capital Securities, including, but not limited to any date of redemption pursuant to the occurrence of
any Special Event. 
  
 “Redemption Price” shall
have the meaning specified in the Amended Declaration. 
  
 “Responsible Officer” means, when used with respect to the Guarantee Trustee, any officer assigned to the Corporate Trust Office, including any managing director, vice president, principal, assistant vice president,
assistant treasurer, assistant secretary or any other officer of the Guarantee Trustee customarily performing functions similar to those performed by any of the above designated officers and having direct responsibility for the administration of
this Guarantee Agreement, and also, with respect to a particular matter, any other officer of the Guarantee Trustee to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject. 

 
 “Senior Indebtedness” shall have the meaning specified in
the Indenture. 
  
 “Successor Guarantee Trustee”
means a successor Guarantee Trustee possessing the qualifications to act as Guarantee Trustee under Article IV hereof. 
  
 “Trust Indenture Act” means the Trust Indenture Act of 1939 (15 U.S.C. §§ 77aaa-77bbbb), as amended. 
  
 “Trust Securities” means the Common Securities and the
Preferred Capital Securities. 
  

 4 

  
 ARTICLE II. TRUST
INDENTURE ACT 
  
 SECTION 2.1. Trust Indenture Act;
Application. 
  
 If any provision hereof limits,
qualifies or conflicts with a provision of the Trust Indenture Act that is required under such Act to be a part of and govern this Guarantee Agreement, the provision of the Trust Indenture Act shall control. If any provision of this Guarantee
Agreement modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, the latter provision shall be deemed to apply to this Guarantee Agreement as so modified or excluded, as the case may be. 
  
 SECTION 2.2. List of Holders. 
  
 (a) The Guarantor will furnish or cause to be furnished to the Guarantee
Trustee a list of Holders at the following times: 
  
 (i) quarterly, not more than 15 days after the last day of February, May, August and November, in each year, a list, in such form as the Guarantee Trustee may reasonably require, of the names and addresses of the Holders as of the last day
of February, May, August and November, as applicable; and 
  
 (ii) at such other times as the Guarantee Trustee may request in writing, within 30 days after the receipt by the Guarantor of any such request, a list of similar form and content as of a date not more than 15 days
prior to the time such list is furnished. 
  
 (b) The Guarantee
Trustee shall comply with the requirements of Section 312(b) of the Trust Indenture Act. 
  
 SECTION 2.3. Reports by the Guarantee Trustee. 
  
 Not later than [January 31] of each year, commencing [January 31,         ], the Guarantee Trustee shall
provide to the Holders such reports, if any, as are required by Section 313 of the Trust Indenture Act in the form and in the manner provided by Section 313 of the Trust Indenture Act. If this Guarantee Agreement shall have been qualified under the
Trust Indenture Act, the Guarantee Trustee shall also comply with the requirements of Section 313(d) of the Trust Indenture Act. 
  
 SECTION 2.4. Periodic Reports to the Guarantee Trustee. 
  
 The Guarantor shall provide to the Guarantee Trustee and the Holders such documents, reports and information, if any, as
required by Section 314 of the Trust Indenture Act and the compliance certificate required by Section 314 of the Trust Indenture Act, in the form, in the manner and at the times required by Section 314 of the Trust Indenture Act, provided that such
documents, reports and information shall be required to be provided to the Securities and Exchange Commission only if this Guarantee Agreement shall have been qualified under the Trust Indenture Act. 
  

 5 

 SECTION 2.5. Evidence of Compliance with Conditions Precedent. 
  
 The Guarantor shall provide to the Guarantee Trustee such evidence of
compliance with such conditions precedent, if any, provided for in this Guarantee Agreement that relate to any of the matters set forth in Section 314(c) of the Trust Indenture Act. Any certificate or opinion required to be given by an officer
pursuant to Section 314(c)(1) may be given in the form of an Officers’ Certificate. 
  
 SECTION 2.6. Events of Default; Waiver. 
  
 The Holders of a Majority in Liquidation Amount of the Preferred Capital Securities may, by vote, on behalf of the Holders, waive any past Event of Default and its consequences. Upon such waiver, any such Event of
Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Guarantee Agreement, but no such waiver shall extend to any subsequent or other default or Event of Default or
impair any right consequent therefrom. 
  
 SECTION 2.7. Event
of Default; Notice. 
  
 (a) The Guarantee
Trustee shall, within 90 days after the occurrence of an Event of Default, transmit by mail, first class postage prepaid, to the Holders, notice of all Events of Default known to the Guarantee Trustee, unless such Events of Default have been cured
or waived before the giving of such notice; provided that, except in the case of a default in the payment of a Guarantee Payment, the Guarantee Trustee shall be protected in withholding such notice if and so long as the Board of Directors,
the executive committee or a trust committee of directors and/or Responsible Officers of the Guarantee Trustee in good faith determines that the withholding of such notice is in the interests of the Holders. 
  
 (b) The Guarantee Trustee shall not be deemed to have knowledge of any Event
of Default unless a Responsible Officer charged with the administration of this Guarantee Agreement shall have received written notice of such Event of Default. 
  

SECTION 2.8. Conflicting Interests. 
  
 The Amended Declaration shall be deemed to be specifically described in this Guarantee Agreement for the purposes of clause
(i) of the first proviso contained in Section 310(b) of the Trust Indenture Act. 
  

 6 

  
 ARTICLE III. POWERS,
DUTIES AND RIGHTS OF THE GUARANTEE TRUSTEE 
  
 SECTION 3.1.
Powers and Duties of the Guarantee Trustee. 
  
 (a) This Guarantee Agreement shall be held by the Guarantee Trustee for the benefit of the Holders, and the Guarantee Trustee shall not transfer this Guarantee Agreement to any Person except a Holder exercising his or her rights pursuant to
Section 5.4(iv) or to a Successor Guarantee Trustee on acceptance by such Successor Guarantee Trustee of its appointment to act as Successor Guarantee Trustee hereunder. The right, title and interest of the Guarantee Trustee, as such, hereunder
shall automatically vest in any Successor Guarantee Trustee upon acceptance by such Successor Guarantee Trustee of its appointment hereunder, and such vesting and cessation of title shall be effective whether or not conveyancing documents have been
executed and delivered pursuant to the appointment of such Successor Guarantee Trustee. 
  
 (b) If an Event of Default has occurred and is continuing, the Guarantee Trustee shall enforce this Guarantee Agreement for the benefit of the Holders. 
  
 (c) The Guarantee Trustee, before the occurrence of any Event of Default and after the cure or waiver of all Events of
Default that may have occurred, shall be obligated to perform only such duties as are specifically set forth in this Guarantee Agreement (including pursuant to Section 2.1), and no implied covenants shall be read into this Guarantee Agreement
against the Guarantee Trustee. If an Event of Default has occurred (that has not been cured or waived pursuant to Section 2.6), the Guarantee Trustee shall exercise such of the rights and powers vested in it by this Guarantee Agreement, and use the
same degree of care and skill in its exercise thereof, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs. 
  
 (d) No provision of this Guarantee Agreement shall be construed to relieve the Guarantee Trustee from liability for its own
negligent action, its own negligent failure to act or its own willful misconduct, except that: 
  
 (i) Prior to the occurrence of any Event of Default and after the curing or waiving of all such Events of Default that may have occurred:

  
 (A) the duties and obligations of the
Guarantee Trustee shall be determined solely by the express provisions of this Guarantee Agreement (including pursuant to Section 2.1), and the Guarantee Trustee shall not be liable except for the performance of such duties and obligations as are
specifically set forth in this Guarantee Agreement (including pursuant to Section 2.1); and 
  
 (B) in the absence of bad faith on the part of the Guarantee Trustee, the Guarantee Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any certificates or opinions 

  

 7 

 
furnished to the Guarantee Trustee and conforming to the requirements of this Guarantee Agreement; but in the case of any such certificates or opinions that
by any provision hereof or of the Trust Indenture Act are specifically required to be furnished to the Guarantee Trustee, the Guarantee Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of
this Guarantee Agreement; 
  
 (ii) The Guarantee
Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer of the Guarantee Trustee, unless it shall be proved that the Guarantee Trustee was negligent in ascertaining the pertinent facts upon which such
judgment was made; 
  
 (iii) The Guarantee
Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of not less than a Majority in Liquidation Amount of the Preferred Capital Securities relating to
the time, method and place of conducting any proceeding for any remedy available to the Guarantee Trustee, or exercising any trust or power conferred upon the Guarantee Trustee under this Guarantee Agreement; and 
  
 (iv) No provision of this Guarantee Agreement shall require
the Guarantee Trustee to expend or risk its own funds or otherwise incur personal financial liability in the performance of any of its duties or in the exercise of any of its rights or powers if the Guarantee Trustee shall have reasonable grounds
for believing that the repayment of such funds or liability is not assured to it under the terms of this Guarantee Agreement or adequate indemnity against such risk or liability is not reasonably assured to it. 
  
 SECTION 3.2. Certain Rights of Guarantee Trustee.

  
 (a) Subject to the provisions of Section 3.1: 
  
 (i) The Guarantee Trustee may conclusively rely and shall be
fully protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or
document reasonably believed by it to be genuine and to have been signed, sent or presented by the proper party or parties. 
  
 (ii) Any direction or act of the Guarantor contemplated by this Guarantee Agreement shall be sufficiently evidenced by an Officers’
Certificate unless otherwise prescribed herein. 
  
 (iii) Whenever, in the administration of this Guarantee Agreement, the Guarantee Trustee shall deem it desirable that a matter be proved or established before taking, suffering or omitting to take any action hereunder, the Guarantee Trustee
(unless other evidence is herein specifically prescribed) may, in the absence of bad faith on its part, request and conclusively rely upon an Officers’ Certificate which, upon receipt of such request from the Guarantee Trustee, shall be
promptly delivered by the Guarantor. 
  

 8 

 (iv) The Guarantee Trustee may consult with legal counsel, and the advice or written
opinion of such legal counsel with respect to legal matters shall be full and complete authorization and protection in respect of any action taken, suffered or omitted to be taken by it hereunder in good faith and in accordance with such advice or
opinion. Such legal counsel may be legal counsel to the Guarantor or any of its Affiliates and may be one of its employees. The Guarantee Trustee shall have the right at any time to seek instructions concerning the administration of this Guarantee
Agreement from any court of competent jurisdiction. 
  
 (v) The Guarantee Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Guarantee Agreement at the request or direction of any Holder, unless such Holder shall have provided to the Guarantee
Trustee such security and indemnity as would satisfy a reasonable person in the position of the Guarantee Trustee, against the costs, expenses (including reasonable attorneys’ fees and expenses) and liabilities that might be incurred by it in
complying with such request or direction, including such reasonable advances as may be requested by the Guarantee Trustee. 
  
 (vi) The Guarantee Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Guarantee Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit. 
  
 (vii) The Guarantee Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through its agents or attorneys, and the Guarantee Trustee shall not be
responsible for any negligence or willful misconduct on the part of any such agent or attorney appointed with due care by it hereunder. 
  
 (viii) Whenever in the administration of this Guarantee Agreement, the Guarantee Trustee shall deem it desirable to receive instructions
with respect to enforcing any remedy or right or taking any other action hereunder, the Guarantee Trustee (A) may request instructions from the Holders, (B) may refrain from enforcing such remedy or right or taking such other action until such
instructions are received and (C) shall be fully protected in acting in accordance with such instructions. 
  
 (b) No provision of this Guarantee Agreement shall be deemed to impose any duty or obligation on the Guarantee Trustee to perform any act or acts or
exercise any right, power, duty or obligation conferred or imposed on it in any jurisdiction in which it shall be illegal, or in which the Guarantee Trustee shall be unqualified or incompetent in accordance with applicable law, to perform any such
act or acts or to exercise any such right, power, duty or obligation. No permissive power or authority available to the 

  

 9 

 
Guarantee Trustee shall be construed to be a duty to act in accordance with such power and authority. 
  
 SECTION 3.3. Indemnity. 
  
 The Guarantor agrees to indemnify the Guarantee Trustee (which for purposes
of this Section 3.3 shall include its officers, directors, employees and agents) for, and to hold it harmless against, any loss, liability or expense incurred without negligence, willful misconduct or bad faith on the part of the Guarantee Trustee,
arising out of or in connection with the acceptance or administration of this Guarantee Agreement, including the reasonable costs and expenses of defending itself against any claim or liability in connection with the exercise or performance of any
of its powers or duties hereunder. The Guarantee Trustee will not claim or exact any lien or charge on any Guarantee Payments as a result of any amount due to it under this Guarantee Agreement. The provisions of this Section 3.3 shall survive the
termination of this Guarantee Agreement and the resignation or removal of the Guarantee Trustee. 
  
 SECTION 3.4. Expenses. 
  
 The Guarantor shall from time to time reimburse the Guarantee Trustee for its expenses and costs (including reasonable attorneys’ or agents’
fees) incurred in connection with the performance of its duties hereunder. 
  
 ARTICLE IV. GUARANTEE TRUSTEE 
  
 SECTION 4.1. Guarantee Trustee; Eligibility. 
  
 (a) There shall at all times be a Guarantee Trustee, which shall: 
  
 (i) not be an Affiliate of the Guarantor; and 
  
 (ii) be a Person that is eligible pursuant to the Trust Indenture Act to act as such and has a combined capital and surplus of at least
$50,000,000, and shall be a corporation meeting the requirements of Section 310(a) of the Trust Indenture Act. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the supervising or
examining authority, then, for the purposes of this Section and to the extent permitted by the Trust Indenture Act, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. 
  
 (b) If at any time
the Guarantee Trustee shall cease to be eligible to so act under Section 4.1(a), the Guarantee Trustee shall immediately resign in the manner and with the effect set out in Section 4.2. 
  
 (c) If the Guarantee Trustee has or shall acquire any “conflicting interest” within the meaning of Section 310(b)
of the Trust Indenture Act, the Guarantee Trustee 

  

 10 

 
and Guarantor shall in all respects comply with the provisions of Section 310(b) of the Trust Indenture Act. 
  
 SECTION 4.2. Appointment, Removal and Resignation of the Guarantee
Trustee. 
  
 (a) No resignation or removal of
the Guarantee Trustee and no appointment of a Successor Guarantee Trustee pursuant to this Article shall become effective until the acceptance of appointment by the Successor Guarantee Trustee by written instrument executed by the Successor
Guarantee Trustee and delivered to the Holders and the Guarantee Trustee. 
  
 (b) Subject to the immediately preceding paragraph, a Guarantee Trustee may resign at any time by giving written notice thereof to the Holders. The Guarantee Trustee shall appoint a successor by requesting from at
least three Persons meeting the eligibility requirements hereunder, such Persons’ expenses and charges to serve as the Guarantee Trustee, and selecting the Person who agrees to the lowest expenses and charges. If the instrument of acceptance by
the Successor Guarantee Trustee shall not have been delivered to the Guarantee Trustee within 30 days after the giving of such notice of resignation, the Guarantee Trustee may petition, at the expense of the Guarantor, any court of competent
jurisdiction for the appointment of a Successor Guarantee Trustee that meets the eligibility requirements hereunder. 
  
 (c) The Guarantee Trustee may be removed for cause at any time by Act (within the meaning of Section 6.8 of the Amended Declaration) of the Holders of at
least a Majority in Liquidation Amount of the Preferred Capital Securities, delivered to the Guarantee Trustee. 
  
 (d) If a resigning Guarantee Trustee shall fail to appoint a successor, or if a Guarantee Trustee shall be removed or become incapable of acting as
Guarantee Trustee, or if any vacancy shall occur in the office of any Guarantee Trustee for any cause, the Holders of the Preferred Capital Securities, by Act of the Holders of record of not less than 25% in aggregate Liquidation Amount of the
Preferred Capital Securities then outstanding delivered to such Guarantee Trustee, shall promptly appoint a successor Guarantee Trustee. If no Successor Guarantee Trustee shall have been so appointed by the Holders of the Preferred Capital
Securities and such appointment accepted by the Successor Guarantee Trustee, any Holder, on behalf of himself and all others similarly situated, may petition any court of competent jurisdiction for the appointment of a Successor Guarantee Trustee.

  

 11 

  
 ARTICLE V. GUARANTEE

  
 SECTION 5.1. Guarantee. 

 
 The Guarantor irrevocably and unconditionally agrees to pay in full to the
Holders the Guarantee Payments (without duplication of amounts theretofore paid by or on behalf of the Issuer Trust), as and when due, regardless of any defense, right of set-off or counterclaim which the Issuer Trust may have or assert, except the
defense of payment. The Guarantor’s obligation to make a Guarantee Payment may be satisfied by direct payment of the required amounts by the Guarantor to the Holders or by causing the Issuer Trust to pay such amounts to the Holders. The
Guarantor shall give prompt written notice to the Guarantee Trustee in the event it makes any direct payment hereunder. 
  
 SECTION 5.2. Waiver of Notice and Demand. 
  
 The Guarantor hereby waives notice of acceptance of the Guarantee Agreement and of any liability to which it applies or may apply, presentment, demand for
payment, any right to require a proceeding first against the Guarantee Trustee, the Issuer Trust or any other Person before proceeding against the Guarantor, protest, notice of nonpayment, notice of dishonor, notice of redemption and all other
notices and demands. 
  
 SECTION 5.3. Obligations Not
Affected. 
  
 The obligations, covenants,
agreements and duties of the Guarantor under this Guarantee Agreement shall in no way be affected or impaired by reason of the happening from time to time of any of the following: 
  
 (a) the release or waiver, by operation of law or otherwise, of the performance or observance by the Issuer Trust of any
express or implied agreement, covenant, term or condition relating to the Preferred Capital Securities to be performed or observed by the Issuer Trust; 
  
 (b) the extension of time for the payment by the Issuer Trust of all or any portion of the Distributions (other than an extension of time for payment of
Distributions that results from an election by the Depositor to defer any interest payment on the Junior Subordinated Debentures as so provided in the Indenture), Redemption Price, Liquidation Distribution or any other sums payable under the terms
of the Preferred Capital Securities or the extension of time for the performance of any other obligation under, arising out of, or in connection with, the Preferred Capital Securities; 
  
 (c) any failure, omission, delay or lack of diligence on the part of the Holders to enforce, assert or exercise any right,
privilege, power or remedy conferred on the Holders pursuant to the terms of the Preferred Capital Securities, or any action on the part of the Issuer Trust granting indulgence or extension of any kind; 
  

 12 

 (d) the voluntary or involuntary liquidation, dissolution, sale of any collateral, receivership,
conservatorship, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition or readjustment of debt of, or other similar proceedings affecting, the Issuer Trust or any of the assets of the Issuer Trust;

  
 (e) any invalidity of, or defect or deficiency in, the
Preferred Capital Securities; 
  
 (f) the settlement or compromise
of any obligation guaranteed hereby or hereby incurred; or 
  
 (g)
any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a guarantor (other than payment of the underlying obligation), it being the intent of this Section 5.3 that the obligations of the
Guarantor hereunder shall be absolute and unconditional under any and all circumstances. 
  
 There shall be no obligation of the Holders to give notice to, or obtain the consent of, the Guarantor with respect to the happening of any of the foregoing. 
  
 SECTION 5.4. Rights of Holders. 
  
 The Guarantor expressly acknowledges that: (i) this Guarantee Agreement will
be deposited with the Guarantee Trustee to be held for the benefit of the Holders; (ii) the Guarantee Trustee has the right to enforce this Guarantee Agreement on behalf of the Holders; (iii) the Holders of a Majority in Liquidation Amount of the
Preferred Capital Securities have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Guarantee Trustee in respect of this Guarantee Agreement or exercising any trust or power conferred upon
the Guarantee Trustee under this Guarantee Agreement; and (iv) any Holder may institute a legal proceeding directly against the Guarantor to enforce its rights under this Guarantee Agreement, without first instituting a legal proceeding against the
Guarantee Trustee, the Issuer Trust or any other Person. 
  
 SECTION 5.5. Guarantee of Payment. 
  
 This Guarantee Agreement creates a guarantee of payment and not of collection. This Guarantee Agreement will not be discharged except by payment of the Guarantee Payments in full (without duplication of amounts theretofore paid by the
Issuer Trust) or upon the distribution of Junior Subordinated Debentures to Holders as provided in the Amended Declaration. 
  
 SECTION 5.6. Subrogation. 
  
 The Guarantor shall be subrogated to all rights (if any) of the Holders against the Issuer Trust in respect of any amounts paid to the Holders by the
Guarantor under this Guarantee Agreement; provided, however, that the Guarantor shall not (except to the 

  

 13 

 
extent required by mandatory provisions of law) be entitled to enforce or exercise any rights which it may acquire by way of subrogation or any indemnity,
reimbursement or other agreement, in all cases as a result of payment under this Guarantee Agreement, if at the time of any such payment, any amounts are due and unpaid under this Guarantee Agreement. If any amount shall be paid to the Guarantor in
violation of the preceding sentence, the Guarantor agrees to hold such amount in trust for the Holders and to pay over such amount to the Holders. 
  
 SECTION 5.7. Independent Obligations. 
  

The Guarantor acknowledges that its obligations hereunder are independent of the obligations of the Issuer Trust with respect to the Preferred Capital
Securities and that the Guarantor shall be liable as principal and as debtor hereunder to make Guarantee Payments pursuant to the terms of this Guarantee Agreement notwithstanding the occurrence of any event referred to in subsections (a) through
(g), inclusive, of Section 5.3 hereof. 
  
 ARTICLE VI. COVENANTS
AND SUBORDINATION 
  
 SECTION 6.1.
Subordination. 
  
 This Guarantee Agreement
will constitute an unsecured obligation of the Guarantor and will rank subordinate and junior in right of payment to all Senior Indebtedness (as defined in the Indenture) of the Guarantor to the same extent and in the same manner set forth in the
Indenture with respect to the Junior Subordinated Debentures, and the provisions of Article XIII of the Indenture will apply, mutatis mutandis, to the obligations of the Guarantor hereunder. The obligations of the Guarantor hereunder do not
constitute Senior Indebtedness of the Guarantor. 
  
 SECTION 6.2.
Pari Passu Guarantees. 
  
 The
obligations of the Guarantor under this Guarantee Agreement shall rank pari passu with any similar guarantee agreements issued by the Guarantor on behalf of the holders of Trust Securities issued by the Issuer Trust and with any other
security, guarantee or other obligation that is expressly stated to rank pari passu with the obligations of the Guarantor under this Guarantee Agreement. 
  

ARTICLE VII. TERMINATION 
  
 SECTION 7.1. Termination. 
  
 This Guarantee Agreement shall terminate and be of no further force and effect upon (i) full payment of the Redemption Price of all Outstanding Preferred
Capital Securities, (ii) the distribution of Junior Subordinated Debentures to the Holders in exchange for all of the Outstanding Preferred Capital Securities or (iii) full payment of the amounts payable in accordance with Article IX of the Amended
Declaration upon 

  

 14 

 
liquidation of the Issuer Trust. Notwithstanding the foregoing, this Guarantee Agreement will continue to be effective or will be reinstated, as the case may
be, if at any time any Holder is required to restore payment of any sums paid under the Preferred Capital Securities or this Guarantee Agreement. 
  
 ARTICLE VIII. MISCELLANEOUS 
  
 SECTION 8.1. Successors and Assigns. 
  

All guarantees and agreements contained in this Guarantee Agreement shall bind the successors, assigns, receivers, conservators, trustees and
representatives of the Guarantor and shall inure to the benefit of the Holders of the Preferred Capital Securities then outstanding. Except in connection with a consolidation, merger or sale involving the Guarantor that is permitted under Article
VIII of the Indenture and pursuant to which the assignee agrees in writing to perform the Guarantor’s obligations hereunder, the Guarantor shall not assign its obligations hereunder, and any purported assignment that is not in accordance with
these provisions shall be void. 
  
 SECTION 8.2.
Amendments. 
  
 Except with respect to any
changes that do not materially adversely affect the rights of the Holders (in which case no consent of the Holders will be required), this Guarantee Agreement may only be amended with the prior approval of the Holders of not less than a Majority in
Liquidation Amount of the Preferred Capital Securities. The provisions of Article VI of the Amended Declaration concerning meetings of the Holders shall apply to the giving of such approval. 
  
 SECTION 8.3. Notices. 
  
 Any notice, request or other communication required or permitted to be given
hereunder shall be in writing, duly signed by the party giving such notice, and delivered, telecopied (confirmed by delivery of the original) or mailed by first class mail as follows: 
  
 (a) if given to the Guarantor, to the address or telecopy number set forth below or such other address or telecopy number or
to the attention of such other Person as the Guarantor may give notice to the Holders: 
  
 [HomeBanc Corp.][HomeBanc Mortgage Corporation] 
 2002 Summit Boulevard 
 Suite 100 
 Atlanta, Georgia 30319

 Facsimile No.:
[                    ] 
 Attention: [                    ] 
  
 (b) if given to the Issuer Trust, in care of the Guarantee Trustee, at the Issuer Trust’s (and the Guarantee Trustee’s) address set forth below
or such other address or 

  

 15 

 
telecopy number or to the attention of such other Person as the Guarantee Trustee on behalf of the Issuer Trust may give notice to the Holders: 

 
 HMB Capital Trust
[        ] 
 c/o [HomeBanc Corp.][HomeBanc Mortgage Corporation] 
 2002 Summit Boulevard 
 Suite 100

 Atlanta, Georgia 30319 
 Facsimile No.: [                    ] 
 Attention: [                    ] 
  
 with a copy to: 
  
 Wilmington Trust Company 
 1100 North Market
Street 
 Wilmington, Delaware 19890-0001 
 Facsimile No.: (302) 636-4140 
 Attention: Corporate Trust Administration 
  
 (c) if given to the Guarantee Trustee: 
  
 Wilmington Trust Company 
 1100 North Market Street 
 Wilmington,
Delaware 19890-0001 
 Facsimile No.: (302) 636-4140 
 Attention: Corporate Trust Administration 
  
 (d) if given to any Holder of record, at the address set forth on the books and records of the Issuer Trust. 
  
 All notices hereunder shall be deemed to have been given when received in person, telecopied with receipt confirmed, or mailed by first class mail,
postage prepaid, except that if a notice or other document is refused delivery or cannot be delivered because of a changed address of which no notice was given, such notice or other document shall be deemed to have been delivered on the date of such
refusal or inability to deliver. 
  
 SECTION 8.4.
Benefit. 
  
 This Guarantee Agreement is
solely for the benefit of the Holders and is not separately transferable from the Preferred Capital Securities. 
  

 16 

 SECTION 8.5. Interpretation. 
  
 In this Guarantee Agreement, unless the context otherwise requires:

  
 (a) capitalized terms used in this Guarantee Agreement but not
defined in the preamble hereto have the respective meanings assigned to them in Section 1.1; 
  
 (b) a term defined anywhere in this Guarantee Agreement has the same meaning throughout; 
  
 (c) all references to “the Guarantee Agreement” or “this Guarantee Agreement” are to this Guarantee Agreement as modified,
supplemented or amended from time to time; 
  
 (d) all references
in this Guarantee Agreement to Articles and Sections are to Articles and Sections of this Guarantee Agreement unless otherwise specified; 
  
 (e) a term defined in the Trust Indenture Act has the same meaning when used in this Guarantee Agreement unless otherwise defined in this Guarantee
Agreement or unless the context otherwise requires; 
  
 (f) a
reference to the singular includes the plural and vice versa; and 
  
 (g) the masculine, feminine or neuter genders used herein shall include the masculine, feminine and neuter genders. 
  
 SECTION 8.6. Governing Law. 
  
 THIS GUARANTEE AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE
CONFLICT OF LAW PRINCIPLES THEREOF. 
  
 SECTION 8.7.
Counterparts. 
  
 This instrument may be executed in
any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. 
  
 [Signatures on Next Page] 
  

 17 

 THIS GUARANTEE AGREEMENT is executed as of the day and year first above written. 
  

			
	 [HOMEBANC CORP.]
 [HOMEBANC
MORTGAGE CORPORATION]
 as Guarantor

		
	By:	 	 
	 Name:
	 	 
	 Title:  
	 	 

  

			
	 WILMINGTON TRUST COMPANY,
 as
Guarantee Trustee, and not in its individual capacity

		
	By:	 	 
	 Name:
	 	 
	 Title:  
	 	 

  

 18Form of Note

 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 FUNDING 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 17308C 70 0	  	REPRESENTED $15,500,000
	ISIN US17308C7002	  	representing 1,550,000 Notes
	 	  	($10 per Note)

  
 CITIGROUP FUNDING INC.

 1,550,000 Principal-Protected Equity Linked Notes Based Upon the Russell 1000 Growth Index 
 with Potential Supplemental Interest at Maturity Due March 2, 2009 
  

Citigroup Funding Inc., a Delaware 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 March 2, 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 not bear any interest, 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. The payments on this Note are fully and unconditionally guaranteed by Citigroup Inc., a Delaware corporation (the “Guarantor”). 
  
 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
1,550,000 Principal-Protected Equity Linked Notes Based Upon the Russell 1000 Growth Index (the “Index”) with Potential Supplemental Interest at Maturity Due 2009 (the “Notes”). 

 INTEREST 
  
 The Notes do not bear interest. No payments on the Notes will be made until the Stated Maturity Date. 
  
 PAYMENT AT MATURITY 
  
 The Notes will mature on March 2, 2009. On the Stated Maturity Date, Holders of the Notes will receive for each Note the
Maturity Payment described below. 
  
 DETERMINATION OF THE MATURITY PAYMENT

  
 The Maturity Payment for each Note equals the sum of the
initial principal amount of $10 per Note plus the Interest Distribution Amount. 
  
 The “Interest Distribution Amount” is calculated as follows: 
  

	 	•	 	If the Index Return is less than or equal to zero, the Interest Distribution Amount will equal zero. 

  

	 	•	 	If the Index Return is greater than zero, the Interest Distribution Amount will equal the product of: 

  
 $10 * (Index Return) 
  
 The “Index Return” will equal the following fraction: 
  

	
	 Average Ending Value – Starting Value

	Starting Value

  
 The “Average
Ending Value” will equal the arithmetic average of all monthly Ending Values. 
  
 The “Ending Value” for each Valuation Date will be the closing value of the Russell 1000 Growth Index on such Valuation Date or, if that day is not an Index Business Day, the closing value on the
immediately following Index Business Day. 
  
 The
“Starting Value” is 494.88, the closing value of the Russell 1000 Growth Index on August 25, 2005. 
  
 “Valuation Dates” occur on the 25th day of each month, commencing September 25, 2005 and ending on February 25, 2009. 
  
 An “Index Business Day” means a day, as determined by the
calculation agent, on which the Index or any successor index is calculated and published and on which securities comprising more than 80% of the value of the Index 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 Index. All 
  

 2 

 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, the occurrence or existence of any
suspension of or limitation imposed on trading (by reason of movements in price exceeding limits permitted by any relevant 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 or market, of accurate price, volume or related information in respect of (a) stocks which then comprise
20% or more of the value of the Index or any successor index, (b) any options or futures contracts, or any options on such futures contracts relating to the Index or any successor index, or (c) any options or futures contracts relating to stocks
which then comprise 20% or more of the value of the Index or any successor index on any exchange or market if, in each case, in the determination of the calculation agent, any such suspension, limitation or unavailability is material. For the
purpose of determining whether a Market Disruption Event exists at any time, if trading in a security included in the Index is materially suspended or materially limited at that time, then the relevant percentage contribution of that security to the
value of the Index will be based on a comparison of the portion of the value of the Index attributable to that security relative to the overall value of the Index, in each case immediately before that suspension or limitation. 
  
 If no closing value of the Index is available on any Index Business Day
because of a Market Disruption Event or otherwise, the value of the Index for that Index Business Day, unless deferred by the calculation agent as described below, will be the arithmetic mean, as determined by the calculation agent, of the value of
the Index obtained from as many dealers in equity securities (which may include Citigroup Global Markets Inc. or any of the Company’s other affiliates), but not exceeding three such dealers, as will make such value available to the calculation
agent. The determination of the value of the Index by the calculation agent in the event of a Market Disruption Event may be deferred by the calculation agent for up to five consecutive Index Business Days on which a Market Disruption Event is
occurring, but not past the Index Business Day prior to the Stated Maturity Date. 
  
 DISCONTINUANCE OF THE RUSSELL 1000 GROWTH INDEX 
  
 If
Frank Russell Company (“Russell”) discontinues publication of the Index or if it or another entity publishes a successor or substitute index that the calculation agent determines, in its sole discretion, to be comparable to the
Index, then the Ending Value of any succeeding Valuation Date will be determined by reference to the value of that index, which is referred to as a “successor index.” 
  
 Upon any selection by the calculation agent of a successor index, the calculation agent will cause notice to be furnished to
the Company and the Trustee, who will provide notice of the selection of the successor index to the registered Holders of the Notes. 
  

 3 

 If Russell discontinues publication of the Index and a successor index is not selected by the calculation
agent or is no longer published on any Valuation Date, the index value to be substituted for the Index for that Valuation Date will be a value computed by the calculation agent for that Valuation Date in accordance with the procedures last used to
calculate the Index prior to any such discontinuance. 
  
 If
Russell discontinues publication of the Index prior to the determination of the Interest Distribution Amount and the calculation agent determines that no successor index is available at that time, then on each Index Business Day until the earlier to
occur of (a) the determination of the Interest Distribution Amount and (b) a determination by the calculation agent that a successor index is available, the calculation agent will determine the value that is to be used in computing the Interest
Distribution Amount as described in the preceding paragraph as if such day were a Valuation Date. The calculation agent will cause notice of each such value to be published not less often than once each month in The Wall Street Journal (or
another newspaper of general circulation). 
  
 If a successor
index is selected or the calculation agent calculates a value as a substitute for the Index as described above, the successor index or value will be substituted for the Index for all purposes, including for purposes of determining whether an Index
Business Day or Market Disruption Event occurs. 
  
 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, the Guarantor and the beneficial owners of the Notes, absent manifest error.

  
 ALTERATION OF METHOD OF CALCULATION 
  
 If at any time the method of calculating the Index or a successor index is
changed in any material respect, or if the Index or a successor index is in any other way modified so that the value of the Index or the successor index does not, in the opinion of the calculation agent, fairly represent the value of that index had
the changes or modifications not been made, then, from and after that time, the calculation agent will, at the close of business in New York, New York, make those adjustments as, in the good faith judgment of the calculation agent, may be necessary
in order to arrive at a calculation of a value of a stock index comparable to the Index or the successor index as if the changes or modifications had not been made, and calculate the closing value with reference to the Index or the successor index.
Accordingly, if the method of calculating the Index or the successor index is modified so that the value of the Index or the successor index is a fraction or a multiple of what it would have been if it had not been modified (e.g., due to a
split in the Index), then the calculation agent will adjust that index in order to arrive at a value of the index as if it had not been modified (e.g., as if the split had not occurred). 
  
 GENERAL 
  
 This Note is one of a duly authorized issue of debt securities (the “Debt Securities”) of the Company,
issued and to be issued in one or more series under a Senior Debt Indenture, dated as of June 1, 2005 (the “Indenture”), among the Company, the Guarantor, and The Bank of New York, 
  

 4 

 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 Guarantor, the Trustee and the Holders of the Notes, and the terms upon which the Notes are, and
are to be, authenticated and delivered. 
  
 In case 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 in payment at Maturity of the
Notes, 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 the unpaid amount has been made or duly provided for,
at the rate of 5% 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, the Guarantor 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, the Guarantor 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 and the Guarantor 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 and the Guarantor 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. 

 
 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. 
  

 5 

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

  

			
	CITIGROUP FUNDING INC.
		
	By:	 	 /s/ Geoffrey S. Richards

	Name:	 	Geoffrey S. Richards
	Title:	 	Vice President and Assistant Treasurer

  
 Corporate Seal 
 Attest: 
  

			
	By:	 	 /s/ Douglas C. Turnbull

	Name:	 	Douglas C. Turnbull
	Title:	 	Assistant Secretary
		
	Dated:	 	August 30, 2005
	
	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

  

 6

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