Citigroup plans 9%-11% ELKS due December 2012 linked to Valero

By Jennifer Chiou

New York, May 2 - Citigroup Funding Inc. plans to price 9% to 11% annualized single observation Equity LinKed Securities due Dec. 27, 2012 tied to Valero Energy Corp. shares, according to a 424B2 filing with the Securities and Exchange Commission.

Interest will be payable monthly.

The payout at maturity will be par of $10 unless Valero shares fall to or below 80% of the initial price on the Dec. 21, 2012 valuation day, in which case the payout will be a number of shares of Valero stock equal to $10 divided by the initial price or, at the investor's option, an equivalent cash amount.

The notes (Cusip: 17318Q830) are expected to price on May 30.

Citigroup Global Markets Inc. is the underwriter.

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