By Angela McDaniels
Tacoma, Wash., Sept. 29 - UBS AG, Jersey Branch priced $100 million of 0% 1X monthly short exchange-traded access securities due Oct. 1, 2040 linked to the Alerian MLP Infrastructure Total Return index, according to a 424B2 filing with the Securities and Exchange Commission.
The issuer sold $10 million of the securities at par on Tuesday and will sell the remaining $90 million from time to time at varying prices.
The notes are putable on weekly repurchase dates, subject to a minimum of 50,000 notes and a redemption fee of 0.125%. UBS can call the notes beginning Oct. 3, 2011, and they will be automatically called if, at any time, the indicative value is $5.00 or less or the index increases 60% from the most recently monthly initial closing level.
The payout at maturity or upon redemption will be the current principal amount plus a return based on the compounded monthly inverse performance of the index plus the accrued financing payment less a fee of approximately 0.85% per year and less the accrued stock borrow fee, which is about 1.95% per year.
The principal amount is initially $25 and is subject to adjustment monthly.
The accrued financing payment is applied to two times the current principal amount at an annual rate based on the most recently published 91-day U.S. Treasury Bill auction rate.
The notes are listed on NYSE Arca under the symbol "MLPS."
The index is comprised of 25 energy infrastructure master limited partnerships whose constituents generally earn the majority of their cash flow from the transportation and storage of energy commodities.
UBS Securities LLC and UBS Financial Services Inc. are the underwriters.
| Issuer: | UBS AG, Jersey Branch
|
| Issue: | 1X monthly short exchange-traded access securities
|
| Underlying index: | Alerian MLP Infrastructure Total Return index
|
| Amount: | $100 million
|
| Maturity: | Oct. 1, 2040
|
| Coupon: | 0%
|
| Price: | Par of $25
|
| Payout at maturity: | Current principal amount minus index return plus accrued financing payment less 0.85% per year fee and less accrued stock borrow fee of about 1.95% per year
|
| Put option: | On weekly repurchase dates, subject to minimum of 50,000 notes and fee of 0.125%
|
| Call option: | From Oct. 3, 2011 onward; also subject to automatic call if index advances by 60% or more
|
| Initial index level: | 1,683.01
|
| Pricing date: | Sept. 28
|
| Settlement date: | Oct. 1 (for $10 million)
|
| Underwriters: | UBS Securities LLC and UBS Financial Services Inc.
|
| Fees: | None
|
| Listing: | NYSE Arca: MLPS
|
| Cusip: | 902641612
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