By Angela McDaniels
Tacoma, Wash., July 25 - UBS AG, London Branch priced $220,000 of trigger phoenix autocallable optimization securities due Aug. 1, 2012 linked to the common stock of Baker Hughes Inc., according to a 424B2 filing with the Securities and Exchange Commission.
If Baker Hughes stock closes at or above the trigger price - 80% of the initial share price - on a quarterly observation date, the issuer will pay a contingent coupon for that quarter at the rate of 17.8% per year. Otherwise, no coupon will be paid that quarter.
If the shares close at or above the initial price on a quarterly observation date, the notes will be called at par of $10 plus the contingent coupon.
If the notes are not called and Baker Hughes shares finish at or above the trigger price, the payout at maturity will be par. Otherwise, investors will be exposed to the share price decline from the initial price.
UBS Financial Services Inc. and UBS Investment Bank are the underwriters.
Issuer: | UBS AG, London Branch
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Issue: | Trigger phoenix autocallable optimization securities
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Underlying stock: | Baker Hughes Inc. (NYSE: BHI)
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Amount: | $220,000
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Maturity: | Aug. 1, 2012
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Coupon: | 17.8% per year, payable quarterly if stock closes at or above trigger price on observation date for that quarter
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Price: | Par of $10.00
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Payout at maturity: | Par if Baker Hughes shares finish at or above trigger price; otherwise, par plus stock return
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Call: | Automatically at par plus contingent coupon if Baker Hughes shares close at or above initial price on a quarterly observation date
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Initial share price: | $79.94
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Trigger price: | $63.95, 80% of initial share price
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Pricing date: | July 25
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Settlement date: | July 28
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Underwriters: | UBS Financial Services Inc. and UBS Investment Bank
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Fees: | 1.5%
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Cusip: | 90267X874
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