IEA – Roll On – Series 7

JBG Income and Equity Accelerator Units Series 7 – Roll On

The JBG Income and Equity Accelerator Units Series 7 – Roll On (“Unit”) offers Investors exposure to the performance of the iShares® Dow Jones US Real Estate Index Fund,  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 (12 July 2013) is designed to coincide with the maturity of the JB Global Income & Equity Accelerator Units Series 7 (IEA Series 7), which are scheduled to mature on 12 July 2013.

The Roll On Units will allow Investors to use any gains that may be payable from IEA Series 7 to fund part of the expenses of the new investment in the Roll On Units (including Prepaid Interest, Currency Management Fee and Application Fees).

The Roll On Units are open to Australian investors. You do not need to hold IEA Series 7 units in order to invest in the Roll On Units.

Features Include:

  • Potential for returns at Maturity which are determined by reference to the volatility of and exposure to the iShares® Dow Jones US Real Estate Index Fund (Series 7 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 7 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 3.85% p.a (3.85% for the full term).
  • Exposure to the AUD/USD exchange rate (Series 7 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 7 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 7 only) and the Application Fee.
  • Capital Protection only applies to the Issue Price.  Investors may lose their Prepaid Interest, Currency Management Fees (Series 7 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 (i.e. $0.1242 per Unit).
  • The Participation Rates as at the date of the PDS was 87.29%.  The Participation Rate may fall to a negligible level, which means 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 7 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 7 Roll On only) or Application Fee paid in relation to the Units.

Initial Strategy Value

Date

12 July 2013

Strategy Value

100

Initial AUD/USD Exchange Rate

Date

12 July  2013

Initial AUD/USD Exchange Rate

$0.90565

Performance Coupons

Date

14 July 2014

15 July 2015

Value

$0.11117 AUD per Unit* (11.14% USD Gross)*

$0.027709 AUD per Unit* (2.28% USD Gross)*

* Net of Performance Fees and after conversion to AUD

Series 7 - Roll On Performance

DateIndicative Strategy Value Indicative Unit Value* Gross Performance
12-Jul-13100$1.150.00%
30-Aug-1394.12$1.15-5.88%
30-Sep-1395.62 $1.15-4.38%
31-Oct-1398.11$1.15-1.89%
29-Nov-1394.7$1.15-5.30%
31-Dec-1394.78$1.15-5.22%
31-Jan-1497.93$1.15-2.07%
28-Feb-14103.01$1.183.01%
31-Mar-14101.51$1.17 1.51%
30-Apr-14 105.05$1.215.05%
30-May-14109.12$1.25 9.12%
30-Jun-14109.5 $1.26 9.50%
Coupon Paid. $0.1117 per Unit
31-Jul-14109.16$1.159.16%
31-Aug-14114.70$1.198314.70%
30-Sep-14104.10$1.154.10%
31-Oct-14113.40 $1.15 13.40%
28-Nov-14116.50$1.211616.50%
31-Dec-14116.20$1.208216.20%
30-Jan-15123.30 $1.289823.30%
27-Feb-15120.20$1.254220.20%
31-Mar-15120.20$1.254220.20%
30-Apr-2015 115.70$1.202415.70%
29-May-15115.30$1.197815.30%
30-Jun-2015109.90 $1.159.90%
31-Jul-15114.80$1.192114.80%
31-Aug-15108.00$1.158.00%
30-Sep-2015107.70$1.157.70%
31-Oct-15112.30$1.1512.30%
30-Nov-15112.20$1.1512.20%
31-Dec-2015111.90$1.1511.90%
29-Jan-2016108.00$1.158.00%
29-Feb-2016107.30$1.157.30%
31-Mar-2016113.00$1.1513.00%
31-Apr-2016111.70$1.1511.70%
31-May-2016113.30$1.1513.30%
30-Jun-2016119.000$1.214219.00%

* 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.