UBS plans contingent income autocallable securities tied to Valero

By Toni Weeks

San Luis Obispo, Calif., Nov. 1 - UBS AG, London Branch plans to price contingent income autocallable securities due Nov. 14, 2016 linked to Valero Energy Corp. shares, according to an FWP with the Securities and Exchange Commission.

If Valero stock closes at or above the 75% downside threshold level on any quarterly determination date, the notes will pay a contingent payment of 3.213% for that quarter, equivalent to 12.85% per year.

If Valero 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 Valero shares equal to $10 divided by the initial share price or, at the issuer's option, the cash equivalent.

The notes (Cusip: 90271R301) will price Nov. 8 and settle Nov. 14.

UBS Securities LLC is the agent. Morgan Stanley Smith Barney LLC will handle distribution.

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