UBS plans contingent absolute return autocallables linked to Rio Tinto

By Angela McDaniels

Tacoma, Wash., Dec. 11 - UBS AG, London Branch plans to price 0% contingent absolute return autocallable optimization securities due Dec. 22, 2014 linked to the common stock of Rio Tinto plc, according to an FWP filing with the Securities and Exchange Commission.

The notes will be called at par plus an annualized call premium of 8% to 9.75% if Rio Tinto stock closes at or above the initial share price on any quarterly observation date. The exact call premium will be set at pricing.

If the notes are not called and the final share price is greater than or equal to the trigger price, 75% of the initial share price, the payout at maturity will be par plus the absolute value of the stock return. Otherwise, investors will lose 1% for every 1% that the final share price is less than the initial share price.

UBS Financial Services Inc. and UBS Investment Bank are the agents.

The notes are expected to price Dec. 13 and settle Dec. 18.

The Cusip number is 90271R806.

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