By Toni Weeks
San Luis Obispo, Calif., June 11 – UBS AG, London Branch priced $25 million principal amount of exchange-traded access securities due June 10, 2044 linked to the Wells Fargo Master Limited Partnership ex Energy index, according to a 424B2 filing with the Securities and Exchange Commission.
The company sold the notes at par to underwriter UBS Securities LLC.
UBS plans to issue up to $100 million of the notes. The remainder will be sold from time to time at varying prices.
The notes may pay a monthly coupon. The coupon amount will equal the sum of the cash distributions that a hypothetical holder of the index constituents would have been entitled to receive during the relevant interest period, reduced by the accrued tracking fee.
The notes are putable on any trading day beginning June 20, subject to a minimum of 50,000 notes. If the notes are put, the payout upon redemption will be par plus the index return plus the coupon, if any, minus the accrued tracking fee and a redemption fee of 0.125%.
On any day, the tracking fee is 0.85% per year multiplied by the current indicative value as of the immediately preceding index business day.
UBS can call the notes beginning June 15, 2015.
The payout at maturity or upon redemption at the issuer’s option will be par plus the index return plus the final coupon, if any, minus the accrued tracking fee plus the stub reference distribution amount, if any.
The stub reference distribution amount will equal the cash distributions that a holder would have received in respect of the index constituents on the record date, for those cash distributions whose ex-dividend date occurs during the period from and excluding the first index business day in the final measurement period and to and including the last index business day in the final measurement period.
The notes began trading June 11 on the NYSE Arca under the symbol "FMLP."
The index is designed to measure the performance of all non-energy master limited partnerships listed on the New York Stock Exchange, NYSE MKT or Nasdaq that satisfy the $100 million market capitalization and other eligibility requirements. Index sponsor Wells Fargo Securities, LLC began publishing data on the index on April 1.
“Investors have increasingly focused on MLPs as an asset class,” head of ETracs Christopher Yeagley said in a press release. “This is the first product with exposure to MLPs that exclusively operates outside of the energy industry.”
| Issuer: | UBS AG, London Branch
|
| Issue: | Exchange-traded access securities
|
| Underlying index: | Wells Fargo Master Limited Partnership ex Energy index
|
| Amount: | Up to $100 million
|
| Maturity: | June 10, 2044
|
| Coupon: | Amount equal to sum of cash distributions made by index constituents during relevant interest period, reduced by accrued tracking fee; payable monthly
|
| Face amount: | $25
|
| Payout at maturity: | Par plus index return and final coupon, minus tracking fee of about 0.85% per year plus stub reference distribution amount
|
| Call option: | Beginning June 15, 2015; payout the same as at maturity
|
| Put option: | On any trading day beginning June 20, subject to minimum of 50,000 notes; payout equal to par plus index return plus coupon, if any, minus accrued tracking fee and 0.125% redemption fee
|
| Initial index level: | 3,689.24
|
| Pricing date: | June 10
|
| Settlement date: | June 13 (for $25 million)
|
| Underwriter: | UBS Securities LLC
|
| Fees: | None
|
| Listing: | NYSE Arca: FMLP
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| Cusip: | 90273A108
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