UBS plans trigger phoenix autocallables tied to biotechnology ETF

By Marisa Wong

Madison, Wis., May 12 - UBS AG, London Branch plans to price trigger phoenix autocallable optimization securities due May 20, 2016 linked to the iShares Nasdaq Biotechnology exchange-traded fund, according to an FWP filing with the Securities and Exchange Commission.

If the fund closes at or above the trigger price - 75% of the initial price - on a quarterly observation date, the issuer will pay a contingent coupon for that quarter at a rate of 8% to 9.5% per year. Otherwise, no coupon will be paid that quarter. The exact coupon will be set at pricing.

If the fund closes at or above the initial price on any quarterly observation date, the notes will be called at par plus the contingent coupon.

If the notes are not called and the fund finishes at or above the trigger price, the payout at maturity will be par plus the contingent coupon. Otherwise, investors will be exposed to the price decline from the initial price.

UBS Financial Services Inc. and UBS Investment Bank are the underwriters.

The notes will price on May 16 and settle on May 21.

The Cusip number is 90272X380.

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