IEA – Roll On – Series 4

JBG Income and Equity Accelerator Units Series 4 – Roll On

The JBG Income and Equity Accelerator Units Series 4 – Roll On (Roll On Units) are designed to offer flexibility by offering Investors exposure to the performance of Berkshire Hathaway Inc Class B Shares (Series 4 Roll On) measured in US Dollars, as well as a compulsory limited recourse Loan under which Investors borrow 100% of the Investment  Amount.

How Does A Roll-On Unit Work?

The Commencement Date of the Roll On Units (6 May 2013) is designed to coincide with the maturity of the JB Global Income & Equity Accelerator Units Series 4, which are scheduled to mature on 6 May 2013.

The Roll On Units will allow Investors to use any gains that may be payable from IEA Series 4 to cover the expenses of the new investment in the Roll On Units (including Prepaid Interest, Currency Management Fee (Series 4 Roll On Units only) and Application Fees).

Features Include:

  • Potential for returns at Maturity which are determined by reference to the volatility of and exposure to the Berkshire Hathaway Class B Shares (Series 4 Roll On) over the Investment Term, including the potential for enhanced returns from an increased exposure to the Reference Asset during times of low volatility of the Reference Asset.
  • An investment term of approximately 3 years.
  • Capital Protection of the Investment Amount (note that Capital Protection does not apply to Prepaid Interest, Currency Management Fees or the Application Fee).
  • Receiving shares in a leading Australian company after Maturity.
  • Self managed superannuation funds (“SMSFs”) are eligible to apply for Roll On Units.
  • A variable Participation Rate, with the potential for a maximum of 150% exposure to the Reference Asset, depending on the volatility. The Participation Rate may fall to a negligible level, which means that Investors have no exposure to the Reference Asset.
  • Contingent Coupons of up to 10.8% p.a. of the Issue Price per Unit paid at the end of each of the first 2 years of the Investment Term, depending on the performance and volatility of the Reference Asset** and the AUD/USD exchange rate (Series 4 Roll On only).
  • A compulsory Limited Recourse Loan for 100% of the Investment Amount. Interest is prepaid for the full term of the investment. The Interest Rate is 4.95% p.a (14.85% for the full term).
  • Exposure to the AUD/USD exchange rate (Series 4 Roll On only). The Currency Management Fee is prepaid for the full term of the investment at 1.1% p.a (3.3% for the full term).

Downloads

Key Risks

  • There is no guarantee that the Units will generate returns in excess of the Prepaid Interest amounts, Currency Management Fee (Series 4 Roll On only) and Application Fees paid. Additionally, in the event of an Investor requested Issuer Buy-Back, Early Maturity Event or if you elect to repay your Loan before the Maturity Date, you will not receive a refund on Prepaid Interest, Currency Management Fee (Series 4 only) and the Application Fee.
  • Capital Protection only applies to the Issue Price. Investors may lose their Prepaid Interest, Currency Management Fees (Series 4 Roll On only) and Application Fees if the Units do not generate a return.
  • There may be no Coupons where the Strategy Value has remained constant or declined over the relevant period. The Coupons are capped at 10.8% of the Issue Price
  • The Participation Rates as at the date of the PDS was 150.00%. The Participation Rate may fall to a negligible level, which mean that Investors have no exposure to the Reference Asset. Your return is affected by the performance of the Reference Asset. There is no guarantee that the Reference Asset will perform well.
  • For Series 4 Roll On, the Performance Coupons and Final Value are subject to movements in the AUD/USD exchange rate and this will affect the amount of the Final Coupon payable. If the AUD/USD exchange rate increases, the Coupon amount will decrease.
  • Gains (and losses) may be magnified by the use of a 100% Loan. However, note that the Loan is a Limited Recourse Loan, so you will never be required to pay more than the Interest and Application Fees applicable to the Investment.
  • The Units may mature early following an Early Maturity Event, including as a result of an Adjustment Event or Market Disruption Event or if your request for an Issuer Buy-Back is accepted. If the Units are subject to Early Maturity for any reason, you will not be entitled to a refund of any Prepaid Interest, Currency Management Fee (Series 4 Roll On only) or Application Fee paid in relation to the Units.

Initial Strategy Value

Date

6 May 2013

Initial Strategy Value

100.00

Final Strategy Value

Date

6 May 2016

Final Strategy Value

123.77

Initial AUD/USD Exchange Rate

Date

6 May 2013

6 May 2014

6 May 2016

Initial AUD/USD Exchange Rate

$1.02513

$0.93401

$0.73673

Performance Coupons and Final Value

Date

6 May 2014

6 May 2015

6 May 2016

Value

$0.13990^ per Unit (11.192%)

$0.1736484^ per Unit (13.89%)

$1.2568875

^Net of Performance Fees and after converting to Australian Dollars

Series 4 - Roll On Performance

DateIndicative Strategy Value Indicative Unit Value* Gross Performance
28-Jun-13101.5$1.271.50%
31-Jul-13104.37$1.304.37%
30-Aug-13100.44$1.260.44%
30-Sep-13102.32$1.282.32%
31-Oct-13103.55$1.293.55%
29-Nov-13104.87 $1.314.87%
31-Dec-13106.74 $1.33 6.74%
31-Jan-14 99.73$1.25-0.27%
28-Feb-14103.38$1.293.38%
31-Mar-14111.77$1.40 11.77%
30-Apr-14115.27$1.4415.27%
Coupon Paid. 13.65% Gross (AUD)
30-May-14114.66$1.293414.66%
30-Jun-14 112.81$1.270212.81%
31-Jul-14111.15 $1.250011.15%
31-Aug-14124.20$1.412624.20%
30-Sep-14125.00 $1.422625.00%
31-Oct-14 126.80$1.445126.80%
28-Nov-14134.80 $1.545134.80%
31-Dec-14135.90 $1.558935.90%
30-Jan-15130.30$1.488930.30%
27-Feb-15 133.10$1.523933.10%
31-Mar-15130.30 $1.488930.30%
30-Apr-2015127.50$1.4539 27.50%
Coupon Paid. 15.43% Gross (AUD)
29-May-15128.90$1.321428.90%
30-Jun-2015122.10 $1.2522.10%
31-Jul-15128.40$1.3151 28.40%
31-Aug-15118.90$1.2518.90%
30-Sep-15116.10 $1.2516.10%
31-Oct-15120.10 $1.2520.10%
30-Nov-15118.70 $1.2518.70%
31-Dec-2015 117.30 $1.25 17.30%
29-Jan-2016 116.00 $1.2516.00%
29-Feb-2016 119.00 $1.25 19.00%
31-Mar-2016123.90 $1.2589 23.90%
31-Apr-2016126.30$1.2889 26.30%
6-May-2016MaturedMaturedMatured

* Unit Value: Investors please note this is a theoretical investment maturity value. This investment is designed to be held to maturity. Any investors seeking to redeem prior to maturity may recieve an amount significantly different to the Indicative Unit Value stated.