By Angela McDaniels
Tacoma, Wash., Oct. 2 - UBS AG, London Branch priced $1.96 million principal amount of 0% short leverage securities due Oct. 8, 2013 linked to the S&P 500 Total Return index, according to a 424B2 filing with the Securities and Exchange Commission.
The notes priced at 102.55, or $10.255 per $10.00 principal amount, and the proceeds totaled $2.01 million.
The notes are putable at any time, subject to a minimum of 100,000 securities, and they will be called if the index increases to 135% of the initial level or more.
The payout at maturity or upon redemption will be par minus (a) 200% of the index return plus (b) the interest amount and minus (c) the accrued borrow cost. The notes are not principal protected.
The interest amount is equal to the interest accrued on $30 at a rate per year equal to overnight Libor, compounded daily.
The accrued borrow cost is a per-year rate equal to the borrow notional multiplied by the borrow rate. On any day, the borrow notional is $20 multiplied by the quotient of the closing level of the index on the preceding day divided by the initial index level. The borrow rate is 0.15% plus the greater of (a) zero and (b) overnight Libor minus the Federal Funds open rate.
UBS Financial Services Inc. and UBS Investment Bank are the underwriters.
| Issuer: | UBS AG, London Branch
|
| Issue: | Short leverage securities
|
| Underlying index: | S&P 500 Total Return
|
| Principal amount: | $1,960,460
|
| Proceeds: | $2,010,451.73
|
| Maturity: | Oct. 8, 2013
|
| Coupon: | 0%
|
| Price: | 102.55
|
| Payout at maturity: | Par minus (a) 200% of index return plus (b) interest amount and minus (c) accrued borrow cost
|
| Put option: | At any time, subject to minimum of 100,000 securities
|
| Call: | Automatically if index increases to 135% of initial level or more
|
| Initial index level: | 2,513.93
|
| Pricing date: | Sept. 28
|
| Settlement date: | Oct. 3
|
| Underwriter: | UBS Financial Services Inc. and UBS Investment Bank
|
| Fees: | 2.55%
|
| Cusip: | 90269V439
|
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