Citigroup ( C) agreed to terms on a $12.5 billion offering of preferred stock to a group of investors that includes former CEO Sandy Weill and Saudi billionaire Prince Alwaleed. The 7% preferred will have a conversion price of $31.62 per common share. As a result of the pricing, and, as contractually required, the maximum conversion price on Citi's $7.5 billion Upper DECS Equity Units that were previously sold to the Abu Dhabi Investment Authority will be reduced to $31.83, effective within 90 days after Dec. 3, 2008. Separately, Citi said it priced a 6.5% preferred stock issue, worth $2.9 billion. The offering, which was significantly oversubscribed, is expected to close on Jan. 23. The conversion price is $33.73 a share.