Anthem
,
Inc.
Anthem
,
Inc. is a health benefits company. The
c
ompany provides health benefits, dental and vision benefits, pharmacy benefits, life insurance, and life and disability insurance benefits.
It
s operations include Blue Cross and Blue Shield plans.
This
Basket Stock
trades on the
New York Stock Exchange (the NYSE)
under the symbol
ANTM
. The company’s CIK number is
1156039
.
|
High ($)
|
Low ($)
|
2008
|
|
|
First Quarter
|
89.28
|
43.23
|
Second Quarter
|
56.66
|
45.80
|
Third Quarter
|
57.57
|
44.40
|
Fourth Quarter
|
47.50
|
29.44
|
2009
|
|
|
First Quarter
|
46.10
|
30.10
|
Second Quarter
|
51.45
|
37.96
|
Third Quarter
|
55.47
|
47.36
|
Fourth Quarter
|
60.36
|
44.72
|
2010
|
|
|
First Quarter
|
68.06
|
58.46
|
Second Quarter
|
65.34
|
48.93
|
Third Quarter
|
56.69
|
47.43
|
Fourth Quarter
|
59.97
|
54.34
|
2011
|
|
|
First Quarter
|
69.79
|
57.95
|
Second Quarter
|
81.78
|
68.06
|
Third Quarter
|
80.79
|
57.01
|
Fourth Quarter
|
70.75
|
62.32
|
2012
|
|
|
First Quarter
|
73.80
|
63.84
|
Second Quarter
|
72.95
|
63.79
|
Third Quarter
|
63.20
|
52.93
|
Fourth Quarter
|
63.03
|
54.33
|
2013
|
|
|
First Quarter
|
66.28
|
58.93
|
Second Quarter
|
81.84
|
67.18
|
Third Quarter
|
89.26
|
81.09
|
Fourth Quarter
|
93.92
|
83.60
|
2014
|
|
|
First Quarter
|
100.97
|
84.25
|
Second Quarter
|
108.82
|
92.00
|
Third Quarter
|
124.17
|
107.29
|
Fourth Quarter
|
129.16
|
111.06
|
2015
|
|
|
First Quarter
|
158.38
|
123.26
|
Second Quarter
|
171.04
|
150.93
|
Third Quarter
|
165.22
|
136.31
|
Fourth Quarter
|
148.81
|
127.86
|
2016
|
|
|
First Quarter
|
144.17
|
117.22
|
Second Quarter (through May 18, 2016)
|
147.52
|
135.51
|
Accelerated Return Notes
®
|
TS-
10
|
Accelerated Return Notes
®
Linked to a Basket of
Eight Common
Stocks, due
July
, 2017
|
|
AT&T Inc.
AT&T Inc. is a communications holding company. The
c
ompany, through its subsidiaries and affiliates, provides local and long-distance phone service, wireless and data communications, Internet access and m
essaging, IP-based and satellit
e television, security services, telecommunications equipment, and directory advertising and publishing.
This
Basket Stock
trades on the
NYSE
under the symbol
T
. The company’s CIK number is
732717
.
|
High ($)
|
Low ($)
|
2008
|
|
|
First Quarter
|
41.43
|
34.36
|
Second Quarter
|
40.51
|
32.76
|
Third Quarter
|
33.30
|
27.75
|
Fourth Quarter
|
29.98
|
22.42
|
2009
|
|
|
First Quarter
|
29.42
|
21.72
|
Second Quarter
|
26.83
|
23.67
|
Third Quarter
|
27.43
|
23.38
|
Fourth Quarter
|
28.34
|
25.31
|
2010
|
|
|
First Quarter
|
28.58
|
24.77
|
Second Quarter
|
26.66
|
24.13
|
Third Quarter
|
28.92
|
24.29
|
Fourth Quarter
|
29.44
|
27.70
|
2011
|
|
|
First Quarter
|
30.71
|
27.33
|
Second Quarter
|
31.88
|
30.13
|
Third Quarter
|
31.68
|
27.54
|
Fourth Quarter
|
30.24
|
27.41
|
2012
|
|
|
First Quarter
|
31.84
|
29.16
|
Second Quarter
|
35.71
|
30.13
|
Third Quarter
|
38.25
|
34.63
|
Fourth Quarter
|
38.34
|
33.14
|
2013
|
|
|
First Quarter
|
36.86
|
33.20
|
Second Quarter
|
39.00
|
34.35
|
Third Quarter
|
35.96
|
33.32
|
Fourth Quarter
|
36.45
|
33.11
|
2014
|
|
|
First Quarter
|
35.07
|
31.86
|
Second Quarter
|
36.74
|
34.49
|
Third Quarter
|
36.59
|
34.21
|
Fourth Quarter
|
35.90
|
32.14
|
2015
|
|
|
First Quarter
|
34.87
|
32.62
|
Second Quarter
|
36.18
|
32.51
|
Third Quarter
|
35.77
|
31.80
|
Fourth Quarter
|
34.93
|
32.31
|
2016
|
|
|
First Quarter
|
39.45
|
33.51
|
Second Quarter (through May 18, 2016)
|
39.55
|
37.86
|
Accelerated Return Notes
®
|
TS-
11
|
Accelerated Return Notes
®
Linked to a Basket of
Eight Common
Stocks, due
July
, 2017
|
|
Danaher
Corporation
Danaher Corporation designs, manufactures and markets professional, medical, industrial and commercial products and services in the sectors of test and measurement, envir
onmental, life sciences, dental
and industrial technologies.
This
Basket Stock
trades on the
NYSE
under the symbol
DHR
. The company’s CIK number is
313616
.
|
High ($)
|
Low ($)
|
2008
|
|
|
First Quarter
|
43.46
|
35.07
|
Second Quarter
|
41.28
|
36.93
|
Third Quarter
|
42.25
|
34.12
|
Fourth Quarter
|
34.27
|
24.74
|
2009
|
|
|
First Quarter
|
29.27
|
24.02
|
Second Quarter
|
32.00
|
26.26
|
Third Quarter
|
34.31
|
28.88
|
Fourth Quarter
|
38.05
|
32.37
|
2010
|
|
|
First Quarter
|
40.44
|
35.08
|
Second Quarter
|
43.71
|
37.12
|
Third Quarter
|
41.45
|
35.74
|
Fourth Quarter
|
47.37
|
39.72
|
2011
|
|
|
First Quarter
|
51.96
|
46.05
|
Second Quarter
|
55.77
|
51.14
|
Third Quarter
|
55.05
|
40.54
|
Fourth Quarter
|
50.86
|
40.42
|
2012
|
|
|
First Quarter
|
56.00
|
48.33
|
Second Quarter
|
56.07
|
49.82
|
Third Quarter
|
55.66
|
49.53
|
Fourth Quarter
|
56.83
|
51.41
|
2013
|
|
|
First Quarter
|
62.65
|
57.48
|
Second Quarter
|
64.36
|
58.05
|
Third Quarter
|
70.49
|
63.63
|
Fourth Quarter
|
77.20
|
67.14
|
2014
|
|
|
First Quarter
|
78.53
|
72.49
|
Second Quarter
|
80.68
|
72.56
|
Third Quarter
|
79.50
|
73.34
|
Fourth Quarter
|
87.06
|
71.70
|
2015
|
|
|
First Quarter
|
87.81
|
82.03
|
Second Quarter
|
87.84
|
81.88
|
Third Quarter
|
92.26
|
82.40
|
Fourth Quarter
|
97.35
|
85.33
|
2016
|
|
|
First Quarter
|
95.29
|
83.59
|
Second Quarter (through May 18, 2016)
|
98.65
|
92.68
|
Accelerated Return Notes
®
|
TS-
12
|
Accelerated Return Notes
®
Linked to a Basket of
Eight Common
Stocks, due
July
, 2017
|
|
McDonald's Corporation
McDonald's Corporation franchises and operates fast-food restaurants in the global restaurant industry. The
c
ompany's restaurants serve a variety of value-priced menu products.
This
Basket Stock
trades on the
NYSE
under the symbol
MCD
. The company’s CIK number is
63908
.
|
High ($)
|
Low ($)
|
2008
|
|
|
.First Quarter
|
58.17
|
50.75
|
Second Quarter
|
61.17
|
55.40
|
Third Quarter
|
65.95
|
57.19
|
Fourth Quarter
|
63.66
|
51.55
|
2009
|
|
|
First Quarter
|
63.75
|
50.86
|
Second Quarter
|
60.99
|
52.40
|
Third Quarter
|
58.82
|
54.23
|
Fourth Quarter
|
64.53
|
56.61
|
2010
|
|
|
First Quarter
|
67.35
|
61.45
|
Second Quarter
|
71.52
|
65.87
|
Third Quarter
|
76.08
|
66.11
|
Fourth Quarter
|
80.34
|
74.92
|
2011
|
|
|
First Quarter
|
76.73
|
72.67
|
Second Quarter
|
84.57
|
75.99
|
Third Quarter
|
90.79
|
82.11
|
Fourth Quarter
|
100.81
|
85.83
|
2012
|
|
|
First Quarter
|
101.74
|
95.55
|
Second Quarter
|
99.40
|
86.32
|
Third Quarter
|
93.71
|
87.15
|
Fourth Quarter
|
94.09
|
84.05
|
2013
|
|
|
First Quarter
|
99.69
|
89.90
|
Second Quarter
|
103.59
|
96.42
|
Third Quarter
|
101.58
|
94.36
|
Fourth Quarter
|
98.92
|
93.27
|
2014
|
|
|
First Quarter
|
98.78
|
93.02
|
Second Quarter
|
103.53
|
97.01
|
Third Quarter
|
101.07
|
91.09
|
Fourth Quarter
|
97.17
|
88.46
|
2015
|
|
|
First Quarter
|
100.25
|
88.78
|
Second Quarter
|
100.68
|
94.30
|
Third Quarter
|
101.10
|
91.21
|
Fourth Quarter
|
120.07
|
98.78
|
2016
|
|
|
First Quarter
|
125.83
|
115.12
|
Second Quarter (through May 18, 2016)
|
131.60
|
125.50
|
Accelerated Return Notes
®
|
TS-
13
|
Accelerated Return Notes
®
Linked to a Basket of
Eight Common
Stocks, due
July
, 2017
|
|
PepsiCo, Inc.
PepsiCo, Inc. operates beverage, snack and food businesses. The
c
ompany manufactures or uses contract manufacturers, markets and sells a variety of grain-based snacks, carbonated and non-carbonated beverages and foods.
This
Basket Stock
trades on the
NYSE
under the symbol
PEP
. The company’s CIK number is
77476
.
|
High ($)
|
Low ($)
|
2008
|
|
|
First Quarter
|
79.57
|
66.73
|
Second Quarter
|
72.13
|
63.59
|
Third Quarter
|
73.19
|
64.40
|
Fourth Quarter
|
71.64
|
50.29
|
2009
|
|
|
First Quarter
|
55.97
|
45.81
|
Second Quarter
|
55.37
|
47.89
|
Third Quarter
|
59.86
|
54.68
|
Fourth Quarter
|
64.23
|
58.46
|
2010
|
|
|
First Quarter
|
66.86
|
58.96
|
Second Quarter
|
66.94
|
60.77
|
Third Quarter
|
66.89
|
61.52
|
Fourth Quarter
|
68.11
|
63.89
|
2011
|
|
|
First Quarter
|
66.91
|
62.31
|
Second Quarter
|
71.78
|
65.09
|
Third Quarter
|
70.52
|
59.99
|
Fourth Quarter
|
66.57
|
60.29
|
2012
|
|
|
First Quarter
|
66.76
|
62.28
|
Second Quarter
|
70.66
|
64.85
|
Third Quarter
|
73.58
|
68.79
|
Fourth Quarter
|
71.19
|
68.02
|
2013
|
|
|
First Quarter
|
79.11
|
69.33
|
Second Quarter
|
84.25
|
78.59
|
Third Quarter
|
86.80
|
79.06
|
Fourth Quarter
|
86.68
|
78.93
|
2014
|
|
|
First Quarter
|
83.50
|
77.10
|
Second Quarter
|
90.10
|
82.59
|
Third Quarter
|
93.79
|
88.10
|
Fourth Quarter
|
100.39
|
90.79
|
2015
|
|
|
First Quarter
|
100.40
|
93.02
|
Second Quarter
|
98.22
|
92.64
|
Third Quarter
|
99.86
|
89.64
|
Fourth Quarter
|
103.08
|
93.85
|
2016
|
|
|
First Quarter
|
102.69
|
93.77
|
Second Quarter (through May 18, 2016)
|
106.57
|
100.91
|
Accelerated Return Notes
®
|
TS-
14
|
Accelerated Return Notes
®
Linked to a Basket of
Eight Common
Stocks, due
July
, 2017
|
|
Pfizer Inc.
Pfizer Inc. is a research-based pharmaceutical company that dis
covers, develops, manufactures
and markets medicines for humans and animals. The
c
ompany's products include prescription pharmaceuticals, non-p
rescription self-medications
and animal health products
,
such as anti-infective medicines and vaccines.
This
Basket Stock
trades on the
NYSE
under the symbol
PFE
. The company’s CIK number is
78003
.
|
High ($)
|
Low ($)
|
2008
|
|
|
First Quarter
|
24.08
|
20.50
|
Second Quarter
|
21.51
|
17.17
|
Third Quarter
|
19.97
|
17.17
|
Fourth Quarter
|
19.00
|
14.45
|
2009
|
|
|
First Quarter
|
18.27
|
11.66
|
Second Quarter
|
15.34
|
13.04
|
Third Quarter
|
16.86
|
14.20
|
Fourth Quarter
|
18.85
|
16.15
|
2010
|
|
|
First Quarter
|
20.00
|
16.91
|
Second Quarter
|
17.29
|
14.26
|
Third Quarter
|
17.41
|
14.14
|
Fourth Quarter
|
17.79
|
16.29
|
2011
|
|
|
First Quarter
|
20.38
|
17.68
|
Second Quarter
|
21.45
|
19.79
|
Third Quarter
|
20.78
|
16.66
|
Fourth Quarter
|
21.83
|
17.33
|
2012
|
|
|
First Quarter
|
22.66
|
20.95
|
Second Quarter
|
23.08
|
21.60
|
Third Quarter
|
24.96
|
22.34
|
Fourth Quarter
|
26.04
|
23.66
|
2013
|
|
|
First Quarter
|
28.86
|
25.85
|
Second Quarter
|
31.08
|
27.23
|
Third Quarter
|
29.67
|
27.65
|
Fourth Quarter
|
32.20
|
28.24
|
2014
|
|
|
First Quarter
|
32.75
|
29.66
|
Second Quarter
|
32.40
|
29.02
|
Third Quarter
|
30.96
|
28.04
|
Fourth Quarter
|
32.09
|
27.70
|
2015
|
|
|
First Quarter
|
35.05
|
31.16
|
Second Quarter
|
35.44
|
33.46
|
Third Quarter
|
36.15
|
30.82
|
Fourth Quarter
|
35.45
|
31.33
|
2016
|
|
|
First Quarter
|
32.18
|
28.56
|
Second Quarter (through May 18, 2016)
|
33.82
|
30.04
|
Accelerated Return Notes
®
|
TS-
15
|
Accelerated Return Notes
®
Linked to a Basket of
Eight Common
Stocks, due
July
, 2017
|
|
Philip Morris International
Inc.
Philip Morris International Inc., through its subsidiaries, affiliates and their licensee
s, produces, sells, distributes
and markets a range of branded cigarettes and tobacco products in markets outside of the United States. The
c
ompany's portfolio comprises both international and local brands.
This
Basket Stock
trades on the
NYSE
under the symbol
PM
. The company’s CIK number is
1413329
.
|
High ($)
|
Low ($)
|
2008
|
|
|
First Quarter
(from March 17, 2008)
|
51.75
|
49.15
|
Second Quarter
|
53.63
|
48.00
|
Third Quarter
|
55.95
|
46.80
|
Fourth Quarter
|
50.78
|
36.63
|
2009
|
|
|
First Quarter
|
44.47
|
32.34
|
Second Quarter
|
44.60
|
36.09
|
Third Quarter
|
49.40
|
42.34
|
Fourth Quarter
|
51.55
|
47.36
|
2010
|
|
|
First Quarter
|
52.89
|
45.51
|
Second Quarter
|
52.95
|
43.17
|
Third Quarter
|
56.32
|
46.45
|
Fourth Quarter
|
60.82
|
55.29
|
2011
|
|
|
First Quarter
|
65.70
|
56.02
|
Second Quarter
|
71.75
|
64.92
|
Third Quarter
|
72.35
|
62.38
|
Fourth Quarter
|
79.10
|
61.76
|
2012
|
|
|
First Quarter
|
88.61
|
73.26
|
Second Quarter
|
90.31
|
81.91
|
Third Quarter
|
93.38
|
86.67
|
Fourth Quarter
|
93.74
|
82.39
|
2013
|
|
|
First Quarter
|
93.42
|
85.83
|
Second Quarter
|
96.44
|
86.50
|
Third Quarter
|
90.54
|
82.95
|
Fourth Quarter
|
91.64
|
84.16
|
2014
|
|
|
First Quarter
|
86.02
|
75.39
|
Second Quarter
|
91.34
|
82.21
|
Third Quarter
|
86.29
|
81.58
|
Fourth Quarter
|
89.90
|
81.39
|
2015
|
|
|
First Quarter
|
85.16
|
75.33
|
Second Quarter
|
86.79
|
76.07
|
Third Quarter
|
85.89
|
77.29
|
Fourth Quarter
|
90.15
|
79.46
|
2016
|
|
|
First Quarter
|
98.90
|
85.80
|
Second Quarter (through May 18, 2016)
|
102.18
|
96.42
|
Accelerated Return Notes
®
|
TS-
16
|
Accelerated Return Notes
®
Linked to a Basket of
Eight Common
Stocks, due
July
, 2017
|
|
QUALCOMM Incorporated
QUALCOMM Incorporated manufactures digital wireless communications equipment. The company licenses its code division multiple access (CDMA) and orthogonal frequency division multiplexing access intellectual property to other companies, and produces CDMA-based integrated circuits, and produces equipment and software used to track workers and assets, and software for wireless content enablement.
This
Basket Stock
trades on the
NASDAQ Global Select Market (the NASDAQ)
under the symbol
QCOM
. The company’s CIK number is
804328
.
|
High ($)
|
Low ($)
|
2008
|
|
|
First Quarter
|
43.79
|
35.97
|
Second Quarter
|
50.42
|
41.19
|
Third Quarter
|
56.39
|
39.88
|
Fourth Quarter
|
42.48
|
29.21
|
2009
|
|
|
First Quarter
|
39.54
|
32.78
|
Second Quarter
|
46.34
|
39.36
|
Third Quarter
|
48.45
|
43.06
|
Fourth Quarter
|
46.86
|
40.68
|
2010
|
|
|
First Quarter
|
49.47
|
35.56
|
Second Quarter
|
43.29
|
32.84
|
Third Quarter
|
45.12
|
31.96
|
Fourth Quarter
|
49.99
|
43.89
|
2011
|
|
|
First Quarter
|
59.58
|
50.21
|
Second Quarter
|
58.59
|
52.25
|
Third Quarter
|
59.36
|
46.40
|
Fourth Quarter
|
57.40
|
47.65
|
2012
|
|
|
First Quarter
|
68.59
|
55.27
|
Second Quarter
|
68.32
|
53.55
|
Third Quarter
|
65.08
|
53.73
|
Fourth Quarter
|
64.35
|
57.43
|
2013
|
|
|
First Quarter
|
67.97
|
63.45
|
Second Quarter
|
67.28
|
59.88
|
Third Quarter
|
70.09
|
59.39
|
Fourth Quarter
|
74.25
|
65.71
|
2014
|
|
|
First Quarter
|
79.28
|
71.12
|
Second Quarter
|
81.32
|
77.61
|
Third Quarter
|
81.60
|
72.49
|
Fourth Quarter
|
78.51
|
69.26
|
2015
|
|
|
First Quarter
|
74.51
|
62.46
|
Second Quarter
|
71.06
|
62.62
|
Third Quarter
|
65.14
|
52.43
|
Fourth Quarter
|
60.87
|
46.83
|
2016
|
|
|
First Quarter
|
53.30
|
42.96
|
Second Quarter (through May 18, 2016)
|
52.91
|
50.03
|
Accelerated Return Notes
®
|
TS-
17
|
Accelerated Return Notes
®
Linked to a Basket of
Eight
Common
Stocks,
due
July
,
2017
|
|
Supplement to the Plan of Distribution; Conflicts of Interest
Under our distribution agreement with MLPF&S, MLPF&S will purchase the notes from us as principal at the public offering price indicated on the cover of this term sheet, less the indicated underwriting discount.
MLPF&S, a broker-dealer subsidiary of BAC, is a member of the Financial Industry Regulatory Authority, Inc. (FINRA) and will participate as selling agent in the distribution of the notes.
Accordingly, offerings of the notes will conform to the requirements of Rule 5121 applicable to FINRA members.
MLPF&S may not make sales in this offering to any of its discretionary accounts without the prior written approval of the account holder.
We may deliver the notes against payment therefor in New York, New York on a date that is greater than three business days following the pricing date.
Under Rule 15c6-1 of the Securities Exchange Act of 1934, trades in the secondary market generally are required to settle in three business days, unless the parties to any such trade expressly agree otherwise.
Accordingly, if the initial settlement of the notes occurs more than three business days from the pricing date, purchasers who wish to trade the notes more than three business days prior to the original issue date will be required to specify alternative settlement arrangements to prevent a failed settlement.
The notes will not be listed on any securities exchange.
In the original offering of the notes, the notes will be sold in minimum investment amounts of 100 units.
If you place an order to purchase the notes, you are consenting to MLPF&S acting as a principal in effecting the transaction for your account
.
MLPF&S
may repurchase and resell the notes, with repurchases and resales being made at prices related to then-prevailing market prices or at negotiated prices
, and these will
include MLPF&S’s trading commissions and mark-ups.
MLPF&S may act as principal or agent in these market-making transactions; however
,
it is not obligated to engage in any such transactions.
At
MLPF&S’s discretion
,
for a short
,
undetermined
initial period after the issuance of the notes, MLPF&S
may offer to buy the notes
in the secondary market
at a price that may exceed
the
initial estimated value
of the notes. Any price offered by MLPF&S for the notes will be based on then-prevailing market conditions and other considerations, including the performance of the
Basket
and the remaining term of the notes.
However, neither we nor any of our
affiliates is obligated to purc
hase your notes at any price, or at any time, and we cannot assure you that we or any of our affiliates will purchase your notes
at a price that
equals or
exceeds the
initial estimated value
of the notes.
The value of the notes shown on your account statement
will be based on
MLPF&S’s
estimate of the value of the notes if MLPF&S or another of our affiliates were to make a market in the notes, which it is not obligated t
o do.
That estimate will be based upon the price that MLPF&S may pay
for the notes in light of then-prevailing market conditions
and other considerations, as mentioned above, and will include transaction costs.
At certain times, this price may b
e higher than or lower than the
initial estimated value
of the notes
.
●
|
the investor’s spouse (including a domestic partner), siblings, parents, grandparents, spouse’s parents, children and grandchildren, but excluding accounts held by aunts, uncles, cousins, nieces, nephews or any other family relationship not directly above or below the individual investor;
|
●
|
a family investment vehicle, including foundations, limited partnerships and personal holding companies, but only if the beneficial owners of the vehicle consist solely of the investor or members of the investor’s household as described above; and
|
●
|
a trust where the grantors and/or beneficiaries of the trust consist solely of the investor or members of the investor’s household as described above; provided that, purchases of the notes by a trust generally cannot be aggregated together with any purchases made by a trustee’s personal account.
|
The notes are our debt securities, the return on which is linked to the performance of the Basket. As is the case for all of our debt securities, including our market-linked notes, the economic terms of the notes reflect our actual or perceived creditworthiness at the time of pricing. In addition, because market-linked notes result in increased operational, funding and liability management costs to us, we typically borrow the funds under these notes at a rate that is more favorable to us than the rate that we might pay for a conventional fixed or floating rate debt security.
This
rate, which we refer to in this term sheet as our internal funding rate, is typically lower than the rate we would pay when we issue conventional fixed or floating rate debt securities.
This ge
nerally relatively lower internal funding
rate, which is reflected in the economic terms of the notes, along with the fees and charges associated with market-linked notes, typically results in the initial estimated value of the notes on the pricing date being less than their public offering price
.
Accelerated Return Notes
®
|
TS-
18
|
Accelerated Return Notes
®
Linked to a Basket of
Eight Common
Stocks, due
July
, 2017
|
|
At maturity, we are required to pay the Redemption Amount to holders of the notes, which will be calculated based on the performance of the Basket and the $10 per unit
principal amount
.
In order to meet these payment obligations, at the time we issue the notes, we may choose to enter into certain hedging arrangements (which may include call options, put options or other derivatives) with MLPF&S or one of its affiliates. The terms of these hedging arrangements are determined by seeking bids from market participants,
including
MLPF&S and its affiliates
, and take into account a number of factors, including our creditworthiness, interest rate movements, the volatility of the Basket
Stock
s
, the tenor of the note
s
and the tenor of the hedging arrangements. The economic terms of the notes and their initial estimated value depend in part on the terms of these hedging arrangements.
MLPF&S has advised us that the hedging arrangements will include a hedging related charge of approximately $0.075 per unit, reflecting an estimated profit to be credited to MLPF&S from these transactions. Since hedging entails risk and may be influenced by unpredictable market forces, additional profits and losses from these hedging arrangements may be realized by MLPF&S or any third party hedge providers.
For further information, see Risk Factors—General Risks Relating to ARNs beginning on page PS-6 and Use of Proceeds on page PS-15 of product supplement STOCK ARN-1.
Summary Tax Consequences
You should consider the U.S. federal income tax consequences of an investment in the notes, including the following:
■
|
There is no statutory, judicial, or administrative authority directly addressing the characterization of the notes.
|
■
|
You agree with us (in the absence of an administrative determination, or judicial ruling to the contrary) to characterize and treat the notes for all tax purposes as a single financial contract with respect to the
Basket.
|
■
|
Under this characterization and tax treatment of the notes, a U.S. Holder (as defined beginning
on page 99 of the prospectus
) generally will recognize capital gain or loss upon maturity or upon a sale or exchange of the notes prior to maturity. This capital gain or loss generally will be long-term capital gain or loss if you held the notes for more than one year.
|
■
|
No assurance can be given that the IRS or any court will agree with this characterization and tax treatment.
|
You should consult your own tax advisor concerning the U.S. federal income tax consequences to you of acquiring, owning, and disposing of the notes, as well as any tax consequences arising under the laws of any state, local, foreign, or other tax jurisdiction and the possible effects of changes in
U.S. federal or other tax laws.
You should review carefully the discussion under the section entitled
U.S. Federal Income Tax Summary beginning on
page PS-29 of product supplement STOCK ARN-1.
Where You Can Find More Information
We have filed a registration statement (including a product
suppl
ement, a prospectus supplement,
and a prospectus) with the SEC for the offering to which this term sheet relates. Before you invest, you should read the Note Prospectus, including this term sheet, and the other documents that we have filed with the SEC, for more complete information about us and this offering. You may get these documents without cost by visiting EDGAR on the SEC website at www.sec.gov. Alternatively, we, any agent, or any dealer participating in this offering will arrange to send you these documents if you so request by c
alling MLPF&S toll-free at 1-800-294-1322
.
Market-Linked Investments Classification
MLPF&S classifies certain market-linked investments (the Market-Linked Investments) into categories, each with different investment characteristics. The following description is meant solely for informational purposes and is not intended to represent any particular Enhanced Return Market-Linked Investment or guarantee any performance.
Enhanced Return Market-Linked Investments are short- to medium-term investments that offer you a way to enhance exposure to a particular market view without taking on a similarly enhanced level of market downside risk. They can be especially effective in a flat to moderately positive market (or, in the case of bearish investments, a flat to moderately negative market). In exchange for the potential to receive better-than market returns on the linked asset, you must generally accept market downside risk and capped upside potential. As these investments are not market downside protected, and do not assure full repayment of principal at maturity, you need to be prepared for the possibility that you may lose all or part of your investment.
Accelerated Return Notes
®
and
ARNs
®
are our registered service marks.
Accelerated Return Notes
®
|
TS-19
|