By Angela McDaniels
Tacoma, Wash., July 14 - UBS AG, Jersey Branch priced $100 million of exchange-traded access securities due July 9, 2040 linked to the Alerian Natural Gas MLP 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 have a principal amount of $25 each.
Interest is payable quarterly and equals the sum of the cash distributions that a hypothetical holder of the index constituents would have been entitled to receive during that quarter, reduced by the accrued tracking fee.
The payout at maturity will be par plus the index return, which could be positive or negative, minus the accrued tracking fee.
The fee amount is initially zero. It will increase each day by an amount equal to 0.85% per year multiplied by par plus the index return on that day.
The notes are putable on weekly repurchase dates, subject to a minimum of 50,000 notes. UBS can call the notes beginning July 18, 2011. The payout upon redemption will be par plus the index return minus the accrued tracking fee and, if the notes are being put back by their holder, minus a redemption fee of 0.125% of par.
The notes are listed on NYSE Arca under the symbol "MLPG."
The index is an equally weighted composite of the 15 largest natural gas infrastructure master limited partnerships. The index constituents generally earn the majority of their cash flow from the transportation, storage and processing of natural gas and natural gas liquids.
UBS Securities LLC and UBS Financial Services Inc. are the underwriters.
| Issuer: | UBS AG, Jersey Branch
|
| Issue: | Exchange-traded access securities
|
| Underlying index: | Alerian Natural Gas MLP index
|
| Amount: | $100 million
|
| Maturity: | July 9, 2040
|
| Coupon: | Equal to the cash distributions that a hypothetical holder of the index constituents would have been entitled to receive, reduced by the accrued tracking fee; payable quarterly
|
| Price: | Par of $25
|
| Payout at maturity: | Par plus index return minus fee of approximately 0.85% per year
|
| Put option: | On weekly repurchase dates, subject to minimum of 50,000 notes and fee of 0.125%
|
| Call option: | From July 18, 2011 onward
|
| Initial index level: | 553.17
|
| Pricing date: | July 13
|
| Settlement date: | July 16 (for $10 million)
|
| Underwriters: | UBS Securities LLC and UBS Financial Services Inc.
|
| Fees: | None
|
| Listing: | NYSE Arca: MLPG
|
| Cusip: | 902641620
|
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