|
Is this product
right for you? |
|
To help you
decide if the Plan is right for you, here is a summary of key points
you should think about. Before investing, please consider not only
the benefits but also all of the risks associated with buying such a
product and the commitment you are making.
|
|
Yes ,
I am happy to invest because:
• I would like the potential
for a higher return linked to the stock market than I would
get from a bank deposit.
• I think the proposed rates to be a good potential return.
• I would like the potential for early return of my
investment.
• I am willing to risk losing some or all of my Capital if
the Index falls by 50% or more at any time during the
Investment Term.
• I understand that the return of my Capital is subject to
Counterparty Risk as described on page 14 of the plan terms.
• I want an investment that is taxed as capital gain.
|
|
No ,
this plan probably isn’t right for me
because:
• I am not willing to risk losing any of my
Capital if the Index falls by 50% or more or due to
bankruptcy of the Issuer.
• I do not have other funds available for emergencies, and
cannot risk having to sell the investment at a loss before
the end of the Investment Term.
• I want a regular income from my investment, and do not
want to risk not receiving a return from it.
• I do not have £10,000 to invest for a three-year term.
• I might want to add to my investment from time to time
during the Investment Term.
|
Things to consider
Your Capital is at risk
from a fall in the Index during the Investment Term
If the Plan does not redeem before the Maturity Date
and the Index closes at or below 50% of the Initial
Index Level on any trading day during the Investment
Term, the Capital returned to you will be reduced if the
Final Index Level is lower than the Initial Index Level.
See the section titled “Returns” on page 9 of the plan
details for details.
The limited Redemption Bonus may constrain returns
The Plan may pay a Redemption Bonus as described on
page 9 of the brochure, of 10% on the Early Redemption
Date. Given that this Redemption Bonus is fixed, you may
receive a lower return due to the Early Redemption of
the Plan than you would from a direct investment in the
Index.
The returns of the Plan are not subject to changes in
exchange rates
Potential returns of the Plan are in Pounds Sterling
(GBP) while the companies in the Index are denominated
in Euros (EUR). This means that you will neither benefit
from, nor suffer from, any change in the exchange rate
between the two currencies. You may therefore get a
lower or a higher return from the Plan than you would
had you received the returns denominated in Euros.
The Plan is not a deposit account and is not guaranteed
by any third party
Investing in the Plan is not the same as putting
your money in a deposit account, nor is it the same as
investing in the companies that make up the Index, and
the Plan is not covered by a deposit guarantee scheme.
Your money will be invested by the Plan Manager in
warrants which are designed to pay the returns of the
Plan as described in the brochure.
No dividends or distributions from companies in the
Index
Investing in the Plan is not the same as investing
in shares of the companies that make up the Index.
You will not receive dividends or distributions from the
companies included in the Index.
Tax regulations may change
Tax rates and the basis of taxation are subject to
change, and the value of tax reliefs depends on your
personal circumstances. Specifically, the tax treatment
of the Plan depends on the use of multiple warrants (a
structure referred to as a “Dual Warrant”) the
treatment of which may change in the future.
Administration and Custody risk
During the Investment Term, the Plan’s Investments
are held in safe custody accounts operated by the
Administrator, Bank of New York Mellon, and registered
in the name of a Nominee. Although the Investments are
protected in case of insolvency or default of the
Administrator and Plan Manager, in the event that the
Administrator or Plan Manager suffers fraud or other
criminal misconduct, there could be a delay in returning
your Capital and any applicable Redemption Bonus or
Growth Bonus.
The Issuer
The Plan Manager will purchase on your behalf
warrants issued by Merrill Lynch International & Co
C.V., part of the Bank of America Corporation (“Bank of
America”). The warrants are effectively a loan to the
Issuer in return for which, instead of receiving
interest, you will receive the performance specified in
the terms of this Plan.
As with any loan, the return of your Capital relies on
the ability of the Issuer to repay it. Should the Issuer
be unable to repay your Capital (for example, if it goes
bankrupt) you may lose all of your Capital, regardless
of how the Index has performed. It is you, not the Plan
Manager, who bears this credit risk.
Please refer to the Brochure and the Terms & Conditions for full
details. |
