By Marisa Wong
Madison, Wis., Oct. 23 - UBS AG, London Branch plans to price contingent income autocallable securities due Oct. 26, 2016 linked to Apple Inc. shares, according to an FWP with the Securities and Exchange Commission.
If Apple stock closes at or above the 85% downside threshold level on a quarterly review date, the notes will pay a contingent coupon at a rate of 13% per year for that quarter.
If the shares close at or above the initial price on any of the first 11 quarterly determination dates, the notes will be redeemed at par of $10 plus the contingent coupon.
If the notes are not called, the payout at maturity will be par plus the contingent payment unless the stock closes below the downside threshold level, in which case the payout will be a number of Apple shares equal to $10 divided by the initial share price or, at the issuer's option, the cash equivalent.
UBS Securities LLC is the agent. Morgan Stanley Smith Barney LLC will handle distribution.
| Issuer: | UBS AG, London Branch
|
| Issue: | Contingent income autocallable securities
|
| Underlying stock: | Apple Inc. (Nasdaq: AAPL)
|
| Amount: | $4,142,000
|
| Maturity: | Oct. 26, 2016
|
| Coupon: | 13% per year, payable quarterly if Apple stock closes at or above downside threshold level on a quarterly review date
|
| Price: | Par
|
| Payout at maturity: | Par plus contingent payment unless stock closes below downside threshold level, in which case a number of Apple shares equal to $10 divided by initial share price or, at issuer's option, cash equivalent
|
| Call: | At par plus contingent coupon if shares close at or above initial price on any of first 11 quarterly determination dates
|
| Initial price: | $521.30
|
| Downside threshold: | $443.11, 85% of initial price
|
| Pricing date: | Oct. 21
|
| Settlement date: | Oct. 24
|
| Agent: | UBS Securities LLC with distribution through Morgan Stanley Smith Barney LLC
|
| Fees: | 2.25%
|
| Cusip: | 90271M856
|
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