By Jennifer Chiou
New York, Aug. 17 - UBS AG priced $9.5 million of 100% principal protection callable CMS spread steepener notes due Aug. 19, 2024, according to a 424B2 filing with the Securities and Exchange Commission.
The notes carry a fixed coupon of 12% for the first year. After that, interest will equal five times the spread of the 30-year Constant Maturity Swap rate over the two-year CMS rate. Each interest payment will be subject to a floor of zero and a cap of 25% per year. Interest is payable quarterly.
The payout at maturity will be par.
Beginning Aug. 19, 2010, the notes will be callable at par on any interest payment date.
UBS Investment Bank is the underwriter.
Issuer: | UBS AG
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Issue: | 100% principal protection callable CMS spread steepener notes
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Amount: | $9.5 million
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Maturity: | Aug. 19, 2024
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Coupon: | 12% for the first year; beginning Aug. 19, 2010, five times the spread of the 30-year CMS rate over the two-year CMS rate, with a floor of zero and a cap of 25% per year; payable quarterly
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Price: | Par
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Payout at maturity: | Par
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Call option: | At par on interest payment dates from Aug. 19, 2010 onward
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Pricing date: | Aug. 14
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Settlement date: | Aug. 19
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Underwriter: | UBS Investment Bank
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Fees: | 4.5%
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