Term Sheet

CALCULATION OF REGISTRATION FEE

 

 

Title of Each Class of

Securities to be Registered

 

Amount

to be

Registered

 

Proposed
Maximum

Offering

Price Per

Unit

  Proposed
Maximum
Aggregate
Offering Price
 

Amount of
Registration

Fee(1)

Autocallable Market-Linked Step Up Notes Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

  662,700   $10.00   $6,627,000   $903.92

 

 

(1) 

Calculated in accordance with Rule 457(r) of the Securities Act of 1933.


Filed Pursuant to Rule 424(b)(2)

Registration No. 333-180488

 

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The notes are being issued by Bank of America Corporation (“BAC”). There are important differences between the notes and a conventional debt security, including different investment risks and certain additional costs. See “Risk Factors” and “Additional Risk Factor” on page TS-7 of this term sheet and “Risk Factors” beginning on page S-8 of product supplement STOCK SUN-2.

The estimated initial value of the notes at the time the terms of the notes were set is less than the public offering price. See “Summary” on the following page, “Risk Factors” on page TS-7 of this term sheet and “Structuring the Notes” on page TS-23 of this term sheet for additional information. The actual value of your notes at any time will reflect many factors and cannot be predicted with accuracy.

None of the Securities and Exchange Commission (the “SEC”), any state securities commission, or any other regulatory body has approved or disapproved of these securities or determined if this Note Prospectus (as defined below) is truthful or complete. Any representation to the contrary is a criminal offense.

 

    

Per Unit

      

Total

        

Public offering price

     $10.00           $6,627,000.00        

Underwriting discount

     $0.20           $132,540.00        

Proceeds, before expenses, to BAC

     $9.80           $6,494,460.00        

The notes:

 

        Are Not FDIC Insured    Are Not Bank Guaranteed    May Lose Value  

Merrill Lynch & Co.

March 21, 2013

 

662,700 Units

$10 principal amount per unit

CUSIP No. 06053E565

  

Pricing Date March 20, 2013

Settlement Date April 5, 2013

Maturity Date March 28, 2016

Autocallable Market-Linked Step Up Notes Linked to a Basket of 23 Common Equity Securities ¡ Maturity of approximately three years if not called prior to maturity ¡ The Basket will be comprised of the common equity securities of 23 different companies (the “Basket Stocks”) ¡ Automatic call of the notes per unit at $10 plus the applicable Call Premium ($0.85 on the first Observation Date and $1.70 on the second Observation Date) if the Basket is flat or increases above 100% of the Starting Value on the relevant Observation Date ¡ The Observation Dates will occur approximately one year and two years after the pricing date ¡ If the notes are not called, at maturity: ¡ a return of 29.10% if the Basket is flat or increases up to the Step Up Value ¡ a return equal to the percentage increase in the level of the Basket if the Basket increases above the Step Up Value ¡ 1-to-1 downside exposure to decreases in the level of the Basket, with up to 100% of your principal at risk ¡ All payments are subject to the credit risk of Bank of America Corporation ¡ No periodic interest payments Limited secondary market liquidity, with no exchange listing Enhanced Return


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

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Summary

The Autocallable Market-Linked Step Up Notes Linked to a Basket of 23 Common Equity Securities, due March 28, 2016 (the “notes”) are our senior unsecured debt securities. The notes are not guaranteed or insured by the Federal Deposit Insurance Corporation or secured by collateral. The notes will rank equally with all of our other unsecured and unsubordinated debt. Any payments due on the notes, including any repayment of principal, will be subject to the credit risk of BAC. The notes will be automatically called at the applicable Call Amount if the Observation Level of the Market Measure, which is an equally weighted basket of 23 Common Equity Securities (the “Basket”), is equal to or greater than the Call Level on the relevant Observation Date. If not called, at maturity, the notes provide you with a Step Up Payment if the Ending Value of the Basket is equal to or greater than its Starting Value, but is not greater than the Step Up Value. If the Ending Value is greater than the Step Up Value, you will participate on a 1-for-1 basis in the increase in the level of the Basket above the Starting Value. If the Ending Value is less than the Starting Value, you will lose all or a portion of the principal amount of your notes. The amounts that we will pay on the notes will be based on the performance of the Basket and calculated based on the $10 per unit Original Offering Price. See “Terms of the Notes” below.

Payments on the notes depend on our credit risk and on the performance of the Basket. The economic terms of the notes (including the Step Up Payment) are based on the rate we would pay to borrow funds through the issuance of market-linked notes and the terms of certain related hedging arrangements. The implied borrowing rate for market-linked notes is typically lower than the rate we would pay when we issue conventional fixed or floating rate debt securities. This difference in borrowing rate, as well as the underwriting discount and the hedging related charge described below, will reduce the economic terms of the notes to you and the estimated initial value of the notes.

Due to these factors, the public offering price you pay to purchase the notes is greater than the estimated initial value of the notes determined immediately at the time the terms of the notes were set. The notes are subject to an automatic call, and the estimated initial value is based on an assumed tenor of the notes. This estimated initial value is $9.67 per unit. For more information about the estimated initial value and the structuring of the notes, see “Structuring the Notes” on page TS-23.

Terms of the Notes

 

 

Issuer:  

Bank of America Corporation (“BAC”)

 

  Call Settlement Dates:  

On or about five business days following the applicable Observation Date, subject to postponement if the related Observation Date is postponed, as described below.

 

Original Offering Price:  

$10.00 per unit

 

  Call Premium:  

$0.85 per unit if called on March 31, 2014 (which represents a return of 8.50% over the Original Offering Price) and $1.70 per unit if called on March 27, 2015 (which represents a return of 17.00% over the Original Offering Price).

 

Term:  

Approximately three years

 

  Ending Value:  

The value of the Basket on the scheduled calculation day. The calculation day is subject to postponement in the event of Market Disruption Events, as described beginning on page S-22 of product supplement STOCK SUN-2.

 

Market Measure:  

An equally weighted basket of the common equity securities of 23 different companies as described on page TS-11 below (each a “Basket Stock” and collectively, the “Basket Stocks”).

 

  Step Up Value:  

129.10 (129.10% of the Starting Value rounded to two decimal places).

 

Starting Value:  

100

 

  Step Up Payment:  

$2.91 per unit, which represents a return of 29.10% over the Original Offering Price.

 

Observation Level:  

The value of the Basket on the applicable Observation Date.

 

  Threshold Value:  

100 (100% of the Starting Value)

 

Observation Dates:  

March 31, 2014 and March 27, 2015, subject to postponement in the event of Market Disruption Events, as described on page TS-8.

 

  Calculation Day:  

The fifth scheduled trading day immediately preceding the maturity date.

 

Call Level:  

100% of the Starting Value

 

  Fees and Charges:  

The underwriting discount of $0.20 per unit as listed on the cover page and the hedging related charge of $0.075 per unit described in “Structuring the Notes” on page TS-23.

 

Call Amounts (per Unit):   $10.85 if called on March 31, 2014 and $11.70 if called on March 27, 2015.   Calculation Agent:   Merrill Lynch, Pierce, Fenner & Smith Incorporated (“MLPF&S”), a subsidiary of BAC.

 

 

Autocallable Market-Linked Step Up Notes    TS-2


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

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Determining Payment on the Notes

Automatic Call Provision

The notes will be called automatically on an Observation Date if the Observation Level on that Observation Date is equal to or greater than the Call Level. If the notes are called, you will receive $10 per unit plus the applicable Call Premium.

 

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Redemption Amount Determination

If the notes are not automatically called, on the maturity date, you will receive a cash payment per unit determined as follows:

 

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Autocallable Market-Linked Step Up Notes    TS-3


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

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The terms and risks of the notes are contained in this term sheet and in the following:

 

  §  

Product supplement STOCK SUN-2 dated March 1, 2013:

http://www.sec.gov/Archives/edgar/data/70858/000119312513088016/d495572d424b5.htm

 

  §  

Series L MTN prospectus supplement dated March 30, 2012 and prospectus dated March 30, 2012:

http://www.sec.gov/Archives/edgar/data/70858/000119312512143855/d323958d424b5.htm

These documents (together, the “Note Prospectus”) have been filed as part of a registration statement with the SEC, which may, without cost, be accessed on the SEC website as indicated above or obtained from MLPF&S by calling 1-866-500-5408. Before you invest, you should read the Note Prospectus, including this term sheet, for information about us and this offering. Any prior or contemporaneous oral statements and any other written materials you may have received are superseded by the Note Prospectus. Capitalized terms used but not defined in this term sheet have the meanings set forth in product supplement STOCK SUN-2. Unless otherwise indicated or unless the context requires otherwise, all references in this document to “we,” “us,” “our,” or similar references are to BAC.

Investor Considerations

 

You may wish to consider an investment in the notes if:

 

§  

You are willing to receive a return on your investment capped at the applicable Call Premium if the relevant Observation Level is equal to or greater than the Call Level.

 

§  

You anticipate that the level of the Basket will increase from the Starting Value to the Ending Value.

 

§  

You are willing to risk a loss of principal and return if the level of the Basket decreases from the Starting Value to the Ending Value.

 

§  

You are willing to forgo the interest payments that are paid on conventional interest bearing debt securities.

 

§  

You are willing to forgo dividends or other benefits of owning the Basket Stocks.

 

§  

You are willing to accept a limited market for sales prior to maturity, and understand that the market prices for the notes, if any, will be affected by various factors, including our actual and perceived creditworthiness, the implied borrowing rate and fees and charges on the notes.

 

§  

You are willing to assume our credit risk, as issuer of the notes, for all payments under the notes, including the Redemption Amount.

The notes may not be an appropriate investment for you if:

 

§  

You want to hold your notes for the full term.

 

§  

You believe that the level of the Basket will decrease from the Starting Value to the Ending Value.

 

§  

You seek 100% principal protection or preservation of capital.

 

§  

You seek interest payments or other current income on your investment.

 

§  

You want to receive dividends or other distributions paid on the Basket Stocks.

 

§  

You seek an investment for which there will be a liquid secondary market.

 

§  

You are unwilling or are unable to take market risk on the notes or to take our credit risk as issuer of the notes.

 

 

We urge you to consult your investment, legal, tax, accounting, and other advisors before you invest in the notes.

 

 

Autocallable Market-Linked Step Up Notes    TS-4


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

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Hypothetical Payout Profile and Examples of Payments at Maturity

These hypothetical values would only apply if the notes are not called on any Observation Date, and show a payout profile at maturity.

 

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This graph reflects the returns on the notes, based on the Step Up Payment of $2.91, the Step Up Value of 129.10% of the Starting Value and the Threshold Value of 100% of the Starting Value. The green line reflects the returns on the notes, while the dotted gray line reflects the returns of a direct investment in the Basket Stocks, excluding dividends.

 

This graph has been prepared for purposes of illustration only.

The following table and examples are for purposes of illustration only. They are based on hypothetical values and show hypothetical returns on the notes. They illustrate the calculation of the Redemption Amount and total rate of return based on the Starting Value and Threshold Value of 100, the Step Up Value of 129.10, the Step Up Payment of $2.91 per unit and a range of hypothetical Ending Values. The actual amount you receive and the resulting total rate of return will depend on the actual Ending Value, whether the notes are called on an Observation Date, and whether you hold the notes until maturity. The following examples do not take into account any tax consequences from investing in the notes.

For recent actual levels of the Market Measure, see “The Basket” section below. The Ending Value will not include any income generated by dividends paid on the Basket Stocks, which you would otherwise be entitled to receive if you invested in those stocks directly. In addition, all payments on the notes are subject to issuer credit risk.

 

Ending Value

  Percentage Change from
the Starting

Value to the
Ending Value
  Redemption
Amount per Unit
  Total Rate
of Return on
the Notes
    60.00         -40.00 %       $6.00         -40.00 %
    70.00         -30.00 %       $7.00         -30.00 %
    80.00         -20.00 %       $8.00         -20.00 %
    90.00         -10.00 %       $9.00         -10.00 %
    94.00         -6.00 %       $9.40         -6.00 %
    97.00         -3.00 %       $9.70         -3.00 %
    100.00  (1)       0.00 %       $12.91  (2)       29.10 %
    103.00         3.00 %       $12.91         29.10 %
    106.00         6.00 %       $12.91         29.10 %
    110.00         10.00 %       $12.91         29.10 %
    120.00         20.00 %       $12.91         29.10 %
    129.10  (3)       29.10 %       $12.91         29.10 %
    130.00         30.00 %       $13.00         30.00 %
    140.00         40.00 %       $14.00         40.00 %
    150.00         50.00 %       $15.00         50.00 %
    160.00         60.00 %       $16.00         60.00 %

 

(1) 

The Starting Value and Threshold Value were set to 100 on the pricing date.

 

(2) 

This amount represents the sum of the Original Offering Price and the Step Up Payment of $2.91.

 

(3) 

This is the Step Up Value.

 

 

Autocallable Market-Linked Step Up Notes    TS-5


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

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Redemption Amount Calculation Examples

Example 1

The Ending Value is 80, or 80% of the Starting Value:

 

Starting Value:

      100.00     

Threshold Value:

      100.00     

 

 

$10 –

  [   $10 ×      100 –  80      ]   = $8.00   Redemption Amount per unit
          100        

Example 2

The Ending Value is 104, or 104% of the Starting Value:

 

Starting Value:

      100.00     

Step Up Value:

      129.10     

Ending Value:

      104.00     

 

 

$10 +

    $2.91   = $12.91   Redemption Amount per unit, the Original Offering Price plus the Step Up Payment, since the Ending Value is equal to or greater than the Starting Value, but less than the Step Up Value.

Example 3

The Ending Value is 150, or 150% of the Starting Value:

 

Starting Value:

      100     

Step Up Value:

      123     

Ending Value:

      150     

 

 

$10 –

  [   $10 ×    150 –  100   ]   = $15.00   Redemption Amount per unit
        100      

 

 

Autocallable Market-Linked Step Up Notes    TS-6


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

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Risk Factors

There are important differences between the notes and a conventional debt security. An investment in the notes involves significant risks, including those listed below. You should carefully review the more detailed explanation of risks relating to the notes in the “Risk Factors” sections beginning on page S-8 of product supplement STOCK SUN-2, page S-5 of the MTN prospectus supplement, and page 8 of the prospectus identified above under “Summary.” We also urge you to consult your investment, legal, tax, accounting, and other advisors before you invest in the notes.

 

  §  

Depending on the performance of the Basket as measured shortly before the maturity date, your investment may result in a loss; there is no guaranteed return of principal.

 

  §  

Your return on the notes may be less than the yield you could earn by owning a conventional fixed or floating rate debt security of comparable maturity.

 

  §  

Payments on the notes are subject to our credit risk, and actual or perceived changes in our creditworthiness are expected to affect the value of the notes. If we become insolvent or are unable to pay our obligations, you may lose your entire investment.

 

  §  

The public offering price you pay for the notes exceeds their estimated initial value. The estimated initial value of the notes is an estimate only, calculated to reflect the costs and charges included in the notes and the implied borrowing rate at the time the terms of the notes were set, and is provided for informational purposes only. The estimated initial value does not represent a minimum price at which we, MLPF&S or any of our affiliates would be willing to purchase your notes in any secondary market (if any exists) at any time. The value of your notes at any time after issuance will vary based on many factors, including changes in market conditions, and cannot be predicted with accuracy.

 

  §  

A trading market is not expected to develop for the notes. Neither we nor MLPF&S is obligated to make a market for, or to repurchase, the notes. There is no assurance that any party will be willing to purchase your notes at any price in any secondary market.

 

  §  

If you attempt to sell the notes prior to maturity, their market value may be lower than the price you paid for them and lower than their estimated initial value. This is due to, among other things, changes in the level of the Basket, the implied borrowing rate we pay to issue market-linked notes, and the inclusion in the public offering price of the underwriting discount and the hedging related charge, all as further described in “Structuring the Notes” on page TS-23. These factors, together with various credit, market and economic factors over the term of the notes, are expected to reduce the price at which you may be able to sell the notes in any secondary market and will affect the value of the notes in complex and unpredictable ways.

 

  §  

Our business activities as a full service financial institution, including our commercial and investment banking activities, our hedging and trading activities (including trades in shares of the Basket Stocks) and any hedging and trading activities we engage in for our clients’ accounts, may affect the market value of the notes and their return and may create conflicts of interest with you.

 

  §  

Changes in the prices of the Basket Stocks may offset each other.

 

  §  

You will have no rights of a holder of the Basket Stocks, and you will not be entitled to receive shares of the Basket Stocks or dividends or other distributions by the issuers of the Basket Stocks.

 

  §  

While we or our affiliates may from time to time own shares of the Basket Stocks, we do not control any company included in the Basket, and are not responsible for any disclosure made by any other company.

 

  §  

The Redemption Amount will not be adjusted for all corporate events that could affect a Basket Stock. See “Description of the Notes — Anti-Dilution Adjustments” beginning on page S-21 of product supplement STOCK SUN-2.

 

  §  

There may be potential conflicts of interest involving the calculation agent. We have the right to appoint and remove the calculation agent.

 

  §  

The U.S. federal income tax consequences of the notes are uncertain, and may be adverse to a holder of the notes. See “Summary Tax Consequences” below and “U.S. Federal Income Tax Summary” beginning on page S-33 of product supplement STOCK SUN-2.

Additional Risk Factor

If the notes are called, your return will be limited to the applicable Call Premium. If the Observation Level of the Basket on an Observation Date is equal to or greater than the Call Level, we will automatically call the notes. If the notes are automatically called, the amount payable on the notes will be the applicable Call Amount, regardless of the extent of the increase in the level of the Basket.

 

 

Autocallable Market-Linked Step Up Notes    TS-7


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

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Additional Terms of the Notes

If a Market Disruption Event occurs on an Observation Date, or if a scheduled Observation Date is not a trading day for any Basket Stock, the calculation agent will establish the Closing Market Price of that Basket Stock, and thus the Observation Level, based on the Closing Market Price of that Basket Stock on the first trading day following the scheduled Observation Date on which no Market Disruption Event occurs with respect to that Basket Stock. However, the Closing Market Price of that Basket Stock will be determined (or, if not determinable, estimated) by the calculation agent in a manner which the calculation agent considers commercially reasonable under the circumstances on a date no later than the tenth scheduled trading day after the originally scheduled Observation Date, regardless of the occurrence of a Market Disruption Event on that scheduled trading day. If an Observation Date is postponed, the relevant Call Settlement Date, if applicable, will be on or about the fifth business day following the Observation Date as postponed. For a Basket Stock that is not affected by a Market Disruption Event on the applicable Observation Date, the Closing Market Price of that Basket Stock will be its Closing Market Price on the applicable Observation Date.

 

 

Autocallable Market-Linked Step Up Notes    TS-8


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

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The Basket

The Basket is designed to allow investors to participate in the percentage changes of the Basket from the Starting Value to the Ending Value. The Basket Stocks are described in the section “The Basket Stocks” below. Each Basket Stock was assigned an initial weight on the pricing date, as set forth in the table below.

For more information on the calculation of the value of the Basket, please see the section entitled “Description of the Notes — Basket Market Measures” on page S-27 of product supplement STOCK-SUN-2.

On the pricing date, for each Basket Stock, the Initial Component Weight, the Closing Market Price, the Component Ratio and the initial contribution to the Basket value is as follows:

 

Basket Stock

 

Ticker

 

Initial

Component

Weight

 

Closing

Market

Price(1)

 

Component

Ratio(2)

 

Initial Basket

Value

Contribution

Abbott Laboratories

  ABT   4.3478%     33.81   0.12859586   4.3478

AbbVie Inc.

  ABBV   4.3478%     39.06   0.11131147   4.3478

Actavis, Inc.

  ACT   4.3478%     89.86   0.04838444   4.3478

Amazon.com, Inc.

  AMZN   4.3478%   257.23   0.01690248   4.3478

Apple Inc.

  AAPL   4.3478%   452.08   0.00961738   4.3478

Celgene Corporation

  CELG   4.3478%   112.32   0.03870928   4.3478

Colgate-Palmolive Company

  CL   4.3478%   114.60   0.03793915   4.3478

Eastman Chemical Company

  EMN   4.3478%     73.18   0.05941276   4.3478

Eli Lilly and Company

  LLY   4.3478%     55.30   0.07862253   4.3478

Exxon Mobil Corporation

  XOM   4.3478%     88.63   0.04905592   4.3478

Intel Corporation

  INTC   4.3478%     21.17   0.20537676   4.3478

International Business Machines Corporation

  IBM   4.3478%   215.06   0.02021681   4.3478

Johnson & Johnson

  JNJ   4.3478%     79.45   0.05472405   4.3478

Marathon Oil Corporation

  MRO   4.3478%     34.60   0.12565971   4.3478

Merck & Co., Inc.

  MRK   4.3478%     44.12   0.09854547   4.3478

National Oilwell Varco, Inc.

  NOV   4.3478%     68.74   0.06325031   4.3478

Novo Nordisk A/S

  NVO   4.3478%   166.75   0.02607392   4.3478

Philip Morris International Inc.

  PM   4.3478%     91.42   0.04755881   4.3478

QUALCOMM Incorporated

  QCOM   4.3478%     65.73   0.06614675   4.3478

Starbucks Corporation

  SBUX   4.3478%     57.43   0.07570653   4.3478

The Coca-Cola Company

  KO   4.3478%     39.87   0.10905006   4.3478

The Hershey Company

  HSY   4.3478%     85.92   0.05060319   4.3478

The Procter & Gamble Company

  PG   4.3478%     77.58   0.05604313   4.3478
         

 

        Starting Value   100.00

 

(1) 

These were the Closing Market Prices of the Basket Stocks on the pricing date.

 

(2) 

Each Component Ratio equals the Initial Component Weight of the relevant Basket Stock (as a percentage) multiplied by 100, and then divided by the Closing Market Price of that Basket Stock on the pricing date and rounded to eight decimal places.

The calculation agent will calculate the value of the Basket by summing the products of the Closing Market Price for each Basket Stock (multiplied by its Price Multiplier) on the calculation day and the Component Ratio applicable to that Basket Stock. The Price Multiplier for each Basket Stock will initially be 1, and is subject to adjustment as described in the product supplement. If a Market Disruption Event occurs as to any Basket Stock on the scheduled calculation day, the Closing Market Price of that Basket Stock will be determined as more fully described in the section entitled “Description of the Notes — Ending Value” beginning on page S-20 of product supplement STOCK SUN-2.

 

 

Autocallable Market-Linked Step Up Notes    TS-9


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

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While actual historical information on the Basket did not exist before the pricing date, the following graph sets forth the hypothetical historical monthly performance of the Basket from March 2008 through February 2013. The graph is based upon actual month-end historical levels of the Basket Stocks, hypothetical Component Ratios determined as of March 31, 2008, and a Basket value of 100.00 as of that date. This hypothetical historical data on the Basket is not necessarily indicative of the future performance of the Basket or what the value of the notes may be. Any historical upward or downward trend in the value of the Basket during any period set forth below is not an indication that the value of the Basket is more or less likely to increase or decrease at any time over the term of the notes.

The shares of AbbVie Inc. were not publicly traded prior to December 10, 2012. As a result, instead of the securities of this Basket Stock, the Basket values represented by the following graph from March 31, 2008 to December 10, 2012 include a fixed Initial Basket Value Contribution of 4.3478.

 

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Autocallable Market-Linked Step Up Notes    TS-10


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

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The Basket Stocks

We have derived the following information about the Underlying Companies from publicly available documents that they have published. We have not independently verified the following information.

Because each Basket Stock is registered under the Securities Exchange Act of 1934, the Underlying Companies are required to file periodically certain financial and other information specified by the SEC. Information provided to or filed with the SEC by the Underlying Companies can be located at the Public Reference Section of the SEC, 100 F Street, N.E., Room 1580, Washington, D.C. 20549 or through the SEC’s web site at http://www.sec.gov by reference to the applicable CIK number set forth below.

This term sheet relates only to the notes and does not relate to any securities of the Underlying Companies. Neither we nor any of our affiliates have participated or will participate in the preparation of the Underlying Companies’ publicly available documents. Neither we nor any of our affiliates have made any due diligence inquiry with respect to the Underlying Companies in connection with the offering of the notes. Neither we nor any of our affiliates make any representation that the publicly available documents or any other publicly available information regarding the Underlying Companies are accurate or complete. Furthermore, there can be no assurance that all events occurring prior to the date of this term sheet, including events that would affect the accuracy or completeness of these publicly available documents that would affect the trading price of the Basket Stocks, have been or will be publicly disclosed. Subsequent disclosure of any events or the disclosure of or failure to disclose material future events concerning the Underlying Companies could affect the value of the Basket Stocks and therefore could affect your return on the notes. The selection of the Basket Stocks is not a recommendation to buy or sell shares of the Basket Stocks.

The tables set forth below shows the quarterly high and low Closing Market Prices of the shares of the Basket Stocks on their primary exchange from the first quarter of 2008 through the pricing date. We obtained this historical data from Bloomberg L.P. We have not independently verified the accuracy or completeness of the information obtained from Bloomberg L.P. These historical trading prices may have been adjusted to reflect certain corporate actions such as stock splits and reverse stock splits.

Abbot Laboratories

Abbott Laboratories discovers, develops, manufactures, and sells a broad and diversified line of health care products and services. The company’s products include pharmaceuticals, nutritional, diagnostics, and vascular products. Abbott markets its products worldwide through affiliates and distributors. This Basket Stock trades on the New York Stock Exchange (the “NYSE”) under the symbol “ABT”. The company’s CIK number is 001800.

 

              High ($)            Low ($)    

2008

   First Quarter    28.95    24.21
   Second Quarter    26.96    24.13
   Third Quarter    28.62    25.93
   Fourth Quarter    28.18    23.66

2009

   First Quarter    27.39    21.28
   Second Quarter    22.98    19.87
   Third Quarter    23.67    20.88
   Fourth Quarter    26.10    23.29

2010

   First Quarter    26.91    25.12
   Second Quarter    25.39    21.94
   Third Quarter    25.12    22.23
   Fourth Quarter    25.68    22.24

2011

   First Quarter    23.48    21.61
   Second Quarter    25.84    23.62
   Third Quarter    25.62    22.44
   Fourth Quarter    26.95    24.00

2012

   First Quarter    29.34    25.91
   Second Quarter    30.85    28.47
   Third Quarter    33.43    30.59
   Fourth Quarter    34.51    30.09

2013

   First Quarter (through the pricing date)    35.14    32.05

 

 

Autocallable Market-Linked Step Up Notes    TS-11


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

AbbVie Inc.

AbbVie Inc. researches and develops pharmaceutical products. The company produces pharmaceutical drugs for specialty therapeutic areas such as immunology, chronic kidney disease, hepatitis C, women’s health, oncology, and neuroscience. The company also offers treatments for diseases including multiple sclerosis, Parkinson’s, and Alzheimer’s disease. This Basket Stock trades on the NYSE under the symbol “ABBV”. The company’s CIK number is 1551152.

 

              High ($)            Low ($)    

2012

   Fourth Quarter*    35.35    33.00

2013

   First Quarter (through the pricing date)    39.06    33.71

* The shares of AbbVie Inc. were not publicly traded prior to December 10, 2012. As a result there is limited trading history for the fourth quarter of 2012 and no trading history prior to that period.

Actavis Inc.

Actavis Inc. is a generic drug manufacturer providing health care to consumers across the United States. This Basket Stock trades on the NYSE under the symbol “ACT”. The company’s CIK number is 884629.

 

              High ($)            Low ($)    

2008

   First Quarter    29.34    25.72
   Second Quarter    31.14    26.68
   Third Quarter    30.78    26.97
   Fourth Quarter    28.97    20.76

2009

   First Quarter    31.11    23.74
   Second Quarter    33.88    28.84
   Third Quarter    37.00    33.00
   Fourth Quarter    40.12    33.94

2010

   First Quarter    42.15    37.69
   Second Quarter    44.94    40.57
   Third Quarter    44.92    39.86
   Fourth Quarter    51.95    43.14

2011

   First Quarter    57.38    50.59
   Second Quarter    68.73    56.51
   Third Quarter    72.10    60.04
   Fourth Quarter    70.52    59.65

2012

   First Quarter    67.06    55.89
   Second Quarter    76.16    65.85
   Third Quarter    85.16    74.69
   Fourth Quarter    90.85    82.72

2013

   First Quarter (through the pricing date)    91.59    83.10

 

 

Autocallable Market-Linked Step Up Notes    TS-12


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

Amazon.com, Inc.

Amazon.com, Inc. is an online retailer that offers a wide range of products. The company’s products include books, music, videotapes, computers, electronics, home and garden, and numerous other products. The company offers personalized shopping services, Web-based credit card payment, and direct shipping to customers. This Basket Stock trades on the Nasdaq Global Select Market (the “NASDAQ”) under the symbol “AMZN”. The company’s CIK number is 1018724.

 

              High ($)            Low ($)    

2008

   First Quarter    96.25    62.43
   Second Quarter    84.51    71.99
   Third Quarter    88.09    63.35
   Fourth Quarter    69.58    35.03

2009

   First Quarter    75.58    48.44
   Second Quarter    87.56    73.50
   Third Quarter    93.85    75.63
   Fourth Quarter    142.25    88.67

2010

   First Quarter    136.55    116.00
   Second Quarter    150.09    108.61
   Third Quarter    160.73    109.14
   Fourth Quarter    184.76    153.03

2011

   First Quarter    191.25    160.97
   Second Quarter    206.07    178.34
   Third Quarter    241.69    177.79
   Fourth Quarter    246.71    173.10

2012

   First Quarter    205.44    175.93
   Second Quarter    231.90    185.50
   Third Quarter    261.68    215.36
   Fourth Quarter    261.50    220.64

2013

   First Quarter (through the pricing date)    283.99    256.42

Apple Inc.

Apple Inc. designs, manufactures, and markets personal computers and related personal computing and mobile communication devices along with a variety of related software, services, peripherals, and networking solutions. The company sells its products worldwide through its online stores, its retail stores, its direct sales force, third-party wholesalers, and resellers. This Basket Stock trades on the NASDAQ under the symbol “AAPL”. The company’s CIK number is 320193.

 

              High ($)            Low ($)    

2008

   First Quarter    194.97    119.15
   Second Quarter    189.96    147.14
   Third Quarter    179.69    105.26
   Fourth Quarter    111.04    80.49

2009

   First Quarter    109.87    78.20
   Second Quarter    144.67    108.69
   Third Quarter    186.15    135.40
   Fourth Quarter    211.64    180.76

2010

   First Quarter    235.83    192.00
   Second Quarter    274.16    235.86
   Third Quarter    292.46    240.16
   Fourth Quarter    325.47    278.64

2011

   First Quarter    363.13    326.72
   Second Quarter    353.10    315.32
   Third Quarter    413.45    343.23
   Fourth Quarter    422.24    363.50

2012

   First Quarter    617.62    411.23
   Second Quarter    636.23    530.12
   Third Quarter    702.10    574.88
   Fourth Quarter    671.74    508.97

2013

   First Quarter (through the pricing date)    549.03    420.05

 

 

Autocallable Market-Linked Step Up Notes    TS-13


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

Celgene Corporation

Celgene Corporation is a global biopharmaceutical company. The company focuses on the discovery, development, and commercialization of therapies designed to treat cancer and immune-inflammatory related diseases. This Basket Stock trades on the NASDAQ under the symbol “CELG”. The company’s CIK number is 816284.

 

              High ($)            Low ($)    

2008

   First Quarter    61.82    46.30
   Second Quarter    65.64    56.90
   Third Quarter    77.01    56.00
   Fourth Quarter    65.23    47.25

2009

   First Quarter    56.49    39.95
   Second Quarter    48.33    38.01
   Third Quarter    57.79    46.02
   Fourth Quarter    57.32    50.21

2010

   First Quarter    65.02    54.77
   Second Quarter    63.40    50.82
   Third Quarter    58.46    49.02
   Fourth Quarter    62.95    55.55

2011

   First Quarter    60.02    49.50
   Second Quarter    60.95    55.35
   Third Quarter    65.56    51.85
   Fourth Quarter    68.01    60.22

2012

   First Quarter    78.50    67.22
   Second Quarter    80.29    59.45
   Third Quarter    77.27    62.95
   Fourth Quarter    82.08    71.30

2013

   First Quarter (through the pricing date)    114.28    81.10

Colgate-Palmolive Company

Colgate-Palmolive Company is a consumer products company that markets its products throughout the world. The company’s products include toothpaste, toothbrushes, shampoos, deodorants, bar and liquid soaps, dishwashing liquid, and laundry products, as well as pet nutrition products for cats and dogs. This Basket Stock trades on the NYSE under the symbol “CL”. The company’s CIK number is 021665.

 

              High ($)            Low ($)    

2008

   First Quarter    80.98    73.50
   Second Quarter    78.89    68.21
   Third Quarter    79.99    68.56
   Fourth Quarter    76.76    54.77

2009

   First Quarter    69.32    55.05
   Second Quarter    71.76    57.29
   Third Quarter    76.55    71.02
   Fourth Quarter    86.32    75.82

2010

   First Quarter    85.46    79.07
   Second Quarter    85.81    76.93
   Third Quarter    84.59    73.84
   Fourth Quarter    81.18    73.75

2011

   First Quarter    81.21    75.93
   Second Quarter    89.11    79.90
   Third Quarter    93.96    80.18
   Fourth Quarter    93.92    86.48

2012

   First Quarter    97.78    88.25
   Second Quarter    104.10    96.17
   Third Quarter    107.49    102.10
   Fourth Quarter    110.62    103.53

2013

   First Quarter (through the pricing date)    115.74    106.08

 

 

Autocallable Market-Linked Step Up Notes    TS-14


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

Eastman Chemical Company

Eastman Chemical Company is an international chemical company which produces chemicals, fibers, and plastics. The company’s operations include coatings, adhesives, specialty polymers, and inks, fibers, performance chemicals and intermediates, performance polymers, and specialty plastics. This Basket Stock trades on the NYSE under the symbol “EMN”. The company’s CIK number is 915389.

 

              High ($)            Low ($)    

2008

   First Quarter    33.74    29.00
   Second Quarter    38.76    32.16
   Third Quarter    34.40    26.64
   Fourth Quarter    27.33    13.42

2009

   First Quarter    16.84    9.00
   Second Quarter    22.52    14.18
   Third Quarter    27.58    17.61
   Fourth Quarter    30.70    25.11

2010

   First Quarter    32.18    28.27
   Second Quarter    35.56    26.68
   Third Quarter    37.00    25.82
   Fourth Quarter    42.04    37.04

2011

   First Quarter    49.66    42.68
   Second Quarter    54.08    47.51
   Third Quarter    52.84    33.31
   Fourth Quarter    41.92    34.23

2012

   First Quarter    54.96    40.09
   Second Quarter    54.39    43.26
   Third Quarter    58.64    47.47
   Fourth Quarter    68.05    53.65

2013

   First Quarter (through the pricing date)    74.78    68.00

Eli Lilly and Company

Eli Lilly and Company discovers, develops, manufactures, and sells pharmaceutical products for humans and animals. The company’s products are sold in countries around the world. The company’s products include neuroscience products, endocrine products, anti-infectives, cardiovascular agents, oncology products, and animal health products. This Basket Stock trades on the NYSE under the symbol “LLY”. The company’s CIK number is 059478.

 

              High ($)            Low ($)    

2008

   First Quarter    57.18    47.77
   Second Quarter    53.06    45.61
   Third Quarter    49.25    43.92
   Fourth Quarter    43.69    29.91

2009

   First Quarter    40.57    27.47
   Second Quarter    35.95    31.88
   Third Quarter    35.15    32.40
   Fourth Quarter    37.51    32.47

2010

   First Quarter    37.41    33.95
   Second Quarter    36.92    32.25
   Third Quarter    37.77    33.12
   Fourth Quarter    38.06    33.66

2011

   First Quarter    35.84    33.63
   Second Quarter    39.15    34.99
   Third Quarter    39.32    34.49
   Fourth Quarter    41.75    35.58

2012

   First Quarter    41.80    38.49
   Second Quarter    42.91    39.18
   Third Quarter    47.64    41.98
   Fourth Quarter    53.81    45.91

2013

   First Quarter (through the pricing date)    55.54    49.51

 

 

Autocallable Market-Linked Step Up Notes    TS-15


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

Exxon Mobil Corporation

Exxon Mobil Corporation operates petroleum and petrochemicals businesses on a worldwide basis. The company’s operations include exploration and production of oil and gas, electric power generation, and coal and minerals operations. The company also manufactures and markets fuels, lubricants, and chemicals. This Basket Stock trades on the NYSE under the symbol “XOM”. The company’s CIK number is 034088.

 

              High ($)            Low ($)    

2008

   First Quarter    93.83    81.44
   Second Quarter    94.56    84.91
   Third Quarter    88.35    73.25
   Fourth Quarter    83.14    62.35

2009

   First Quarter    81.64    62.22
   Second Quarter    74.05    64.75
   Third Quarter    72.75    65.12
   Fourth Quarter    76.47    66.58

2010

   First Quarter    70.30    64.35
   Second Quarter    69.29    57.07
   Third Quarter    62.72    56.57
   Fourth Quarter    73.42    62.19

2011

   First Quarter    87.07    74.55
   Second Quarter    88.00    76.78
   Third Quarter    85.22    68.03
   Fourth Quarter    85.28    71.15

2012

   First Quarter    87.49    83.53
   Second Quarter    87.07    77.60
   Third Quarter    92.30    83.11
   Fourth Quarter    93.48    85.10

2013

   First Quarter (through the pricing date)    91.76    87.70

Intel Corporation

Intel Corporation designs, manufactures, and sells computer components and related products. The company’s major products include microprocessors, chipsets, embedded processors and microcontrollers, flash memory products, graphics products, network and communications products, systems management software, conferencing products, and digital imaging products. This Basket Stock trades on the NASDAQ under the symbol “INTC”. The company’s CIK number is 050863.

 

              High ($)            Low ($)    

2008

   First Quarter    25.35    18.61
   Second Quarter    25.00    20.69
   Third Quarter    24.52    17.27
   Fourth Quarter    18.52    12.23

2009

   First Quarter    15.82    12.08
   Second Quarter    16.64    15.00
   Third Quarter    20.32    15.94
   Fourth Quarter    20.83    18.50

2010

   First Quarter    22.68    19.01
   Second Quarter    24.21    19.45
   Third Quarter    21.78    17.72
   Fourth Quarter    21.91    18.87

2011

   First Quarter    22.14    19.82
   Second Quarter    23.87    19.49
   Third Quarter    23.23    19.20
   Fourth Quarter    25.66    20.62

2012

   First Quarter    28.19    24.54
   Second Quarter    29.18    25.04
   Third Quarter    26.88    22.51
   Fourth Quarter    22.84    19.36

2013

   First Quarter (through the pricing date)    22.68    20.23

 

 

Autocallable Market-Linked Step Up Notes    TS-16


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

International Business Machines Corporation

International Business Machines Corporation (IBM) provides computer solutions through the use of advanced information technology. The company’s solutions include technologies, systems, products, services, software, and financing. The company offers its products through its global sales and distribution organization, as well as through a variety of third party distributors and resellers. This Basket Stock trades on the NYSE under the symbol “IBM”. The company’s CIK number is 051143.

 

              High ($)            Low ($)    

2008

   First Quarter    119.06    97.50
   Second Quarter    129.71    114.81
   Third Quarter    130.00    111.47
   Fourth Quarter    110.13    71.74

2009

   First Quarter    98.78    81.98
   Second Quarter    109.40    97.61
   Third Quarter    122.11    100.19
   Fourth Quarter    132.57    117.90

2010

   First Quarter    134.14    121.88
   Second Quarter    132.68    122.10
   Third Quarter    135.48    121.86
   Fourth Quarter    146.92    135.25

2011

   First Quarter    166.05    147.05
   Second Quarter    172.87    162.33
   Third Quarter    185.21    157.54
   Fourth Quarter    194.56    173.29

2012

   First Quarter    208.65    179.16
   Second Quarter    209.50    188.54
   Third Quarter    207.45    183.09
   Fourth Quarter    211.00    185.51

2013

   First Quarter (through the pricing date)    215.80    192.32

Johnson & Johnson

Johnson & Johnson manufactures health care products and provides related services for the consumer, pharmaceutical, and medical devices and diagnostics markets. The company sells products such as skin and hair care products, acetaminophen products, pharmaceuticals, diagnostic equipment, and surgical equipment in countries located around the world. This Basket Stock trades on the NYSE under the symbol “JNJ”. The company’s CIK number is 200406.

 

              High ($)            Low ($)    

2008

   First Quarter    68.31    61.33
   Second Quarter    68.26    63.57
   Third Quarter    72.22    64.64
   Fourth Quarter    67.79    55.33

2009

   First Quarter    60.65    46.60
   Second Quarter    56.96    50.65
   Third Quarter    61.79    55.98
   Fourth Quarter    64.96    58.93

2010

   First Quarter    65.36    62.37
   Second Quarter    66.03    58.00
   Third Quarter    62.43    57.02
   Fourth Quarter    64.76    61.55

2011

   First Quarter    63.35    57.66
   Second Quarter    67.29    59.46
   Third Quarter    67.92    60.20
   Fourth Quarter    66.02    61.27

2012

   First Quarter    65.96    64.30
   Second Quarter    67.56    61.78
   Third Quarter    69.53    67.21
   Fourth Quarter    72.52    67.97

2013

   First Quarter (through the pricing date)    79.45    70.74

 

 

Autocallable Market-Linked Step Up Notes    TS-17


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

Marathon Oil Corporation

Marathon Oil Corporation is an independent international energy company engaged in exploration and production, oil sands mining and integrated gas. The company’s operations are focused in North America, Africa and Europe. This Basket Stock trades on the NYSE under the symbol “MRO”. The company’s CIK number is 101778.

 

              High ($)            Low ($)    

2008

   First Quarter    37.57    27.46
   Second Quarter    33.42    27.27
   Third Quarter    32.04    22.75
   Fourth Quarter    23.56    11.89

2009

   First Quarter    18.13    12.70
   Second Quarter    20.28    16.44
   Third Quarter    20.57    17.02
   Fourth Quarter    21.41    18.50

2010

   First Quarter    19.94    17.02
   Second Quarter    20.71    18.33
   Third Quarter    21.24    18.34
   Fourth Quarter    22.48    20.08

2011

   First Quarter    32.36    22.67
   Second Quarter    32.88    29.78
   Third Quarter    34.07    21.58
   Fourth Quarter    29.34    20.27

2012

   First Quarter    35.06    30.47
   Second Quarter    32.23    23.32
   Third Quarter    31.09    24.09
   Fourth Quarter    31.93    29.30

2013

   First Quarter (through the pricing date)    35.71    31.59

Merck & Co., Inc.

Merck & Co., Inc. is a global health care company that delivers health solutions through its prescription medicines, vaccines, biologic therapies, animal health, and consumer care products, which it markets directly and through its joint ventures. The company has operations in pharmaceutical, animal health, and consumer care. This Basket Stock trades on the NYSE under the symbol “MRK”. The company’s CIK number is 310158.

 

              High ($)            Low ($)    

2008

   First Quarter    60.55    37.95
   Second Quarter    41.71    34.68
   Third Quarter    38.45    30.34
   Fourth Quarter    32.09    23.56

2009

   First Quarter    31.00    20.99
   Second Quarter    27.96    22.97
   Third Quarter    32.95    26.45
   Fourth Quarter    38.00    30.67

2010

   First Quarter    41.03    36.20
   Second Quarter    37.71    31.82
   Third Quarter    37.34    34.22
   Fourth Quarter    37.42    34.10

2011

   First Quarter    37.35    31.08
   Second Quarter    37.58    33.07
   Third Quarter    36.31    29.81
   Fourth Quarter    37.90    31.35

2012

   First Quarter    39.26    37.31
   Second Quarter    41.75    37.18
   Third Quarter    45.23    41.21
   Fourth Quarter    47.96    40.64

2013

   First Quarter (through the pricing date)    45.04    40.85

 

 

Autocallable Market-Linked Step Up Notes    TS-18


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

National Oilwell Varco Inc.

National Oilwell Varco Inc. is a worldwide provider of equipment and components used in oil and gas drilling and production operations, oilfield services, and supply chain integration services to the upstream oil and gas industry. This Basket Stock trades on the NYSE under the symbol “NOV”. The company’s CIK number is 1021860.

 

              High ($)            Low ($)    

2008

   First Quarter    76.81    51.49
   Second Quarter    91.55    60.17
   Third Quarter    90.43    45.61
   Fourth Quarter    47.06    17.86

2009

   First Quarter    33.64    22.35
   Second Quarter    40.08    29.27
   Third Quarter    44.38    29.55
   Fourth Quarter    49.82    40.89

2010

   First Quarter    47.56    39.92
   Second Quarter    46.45    33.02
   Third Quarter    44.85    33.24
   Fourth Quarter    67.25    43.94

2011

   First Quarter    82.26    63.72
   Second Quarter    81.46    65.40
   Third Quarter    83.31    51.22
   Fourth Quarter    75.73    50.23

2012

   First Quarter    87.18    70.75
   Second Quarter    80.67    60.00
   Third Quarter    84.83    64.40
   Fourth Quarter    82.03    64.87

2013

   First Quarter (through the pricing date)    74.14    66.26

Novo Nordisk A/S

Novo Nordisk A/S develops, produces, and markets pharmaceutical products. The company focuses on diabetes care and offers insulin delivery systems and other diabetes products. The company also works in areas such as haemostatis management, growth disorders, and hormone replacement therapy. The company offers educational and training materials. The company markets worldwide. This Basket Stock is an American Depositary Receipt, and trades on the NYSE under the symbol “NVO”. The company’s CIK number is 353278.

 

              High ($)            Low ($)    

2008

   First Quarter    70.68    57.93
   Second Quarter    73.03    61.46
   Third Quarter    66.76    51.08
   Fourth Quarter    57.71    44.02

2009

   First Quarter    55.78    43.14
   Second Quarter    55.42    41.97
   Third Quarter    65.67    53.51
   Fourth Quarter    69.33    61.60

2010

   First Quarter    79.13    64.35
   Second Quarter    85.32    74.02
   Third Quarter    99.24    81.13
   Fourth Quarter    112.57    90.99

2011

   First Quarter    127.96    110.78
   Second Quarter    131.43    117.02
   Third Quarter    127.27    97.31
   Fourth Quarter    115.26    94.58

2012

   First Quarter    144.71    115.46
   Second Quarter    151.88    130.75
   Third Quarter    160.83    144.17
   Fourth Quarter    170.11    145.18

2013

   First Quarter (through the pricing date)    194.30    165.40

 

 

Autocallable Market-Linked Step Up Notes    TS-19


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

Phillip Morris International Inc.

Philip Morris International Inc., through its subsidiaries, affiliates and their licensees, produces, sells, distributes, and markets a wide range of branded cigarettes and tobacco products in markets outside of the United States of America. The company’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    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 (through the pricing date)    93.42    85.83

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 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 (through the pricing date)    67.97    63.45

 

 

Autocallable Market-Linked Step Up Notes    TS-20


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

Starbucks Corporation

Starbucks Corporation retails, roasts, and provides its own brand of specialty coffee. The company operates retail locations worldwide and sells whole bean coffees through its sales group, direct response business, supermarkets, and on the Internet. The company also produces and sells bottled coffee drinks and a line of ice creams. This Basket Stock trades on the NASDAQ under the symbol “SBUX”. The company’s CIK number is 829224.

 

              High ($)            Low ($)    

2008

   First Quarter    20.45    16.80
   Second Quarter    18.60    15.66
   Third Quarter    16.93    13.58
   Fourth Quarter    14.80    7.17

2009

   First Quarter    12.39    8.27
   Second Quarter    15.30    11.17
   Third Quarter    20.76    12.97
   Fourth Quarter    23.80    18.75

2010

   First Quarter    25.56    21.70
   Second Quarter    28.12    24.24
   Third Quarter    26.28    22.86
   Fourth Quarter    32.93    25.69

2011

   First Quarter    37.97    31.53
   Second Quarter    39.49    34.86
   Third Quarter    41.16    34.05
   Fourth Quarter    46.45    36.20

2012

   First Quarter    56.26    45.34
   Second Quarter    61.67    51.27
   Third Quarter    54.20    43.16
   Fourth Quarter    54.58    44.98

2013

   First Quarter (through the pricing date)    58.67    53.21

The Coca-Cola Company

The Coca-Cola Company manufactures, markets, and distributes soft drink concentrates and syrups. The company also distributes and markets juice and juice-drink products. The company distributes its products to retailers and wholesalers in the United States and internationally. This Basket Stock trades on the NYSE under the symbol “KO”. The company’s CIK number is 021344.

 

              High ($)            Low ($)    

2008

   First Quarter    32.78    28.70
   Second Quarter    30.72    25.92
   Third Quarter    27.71    24.80
   Fourth Quarter    27.08    20.51

2009

   First Quarter    22.95    18.93
   Second Quarter    24.88    21.12
   Third Quarter    26.88    24.06
   Fourth Quarter    29.56    26.56

2010

   First Quarter    28.57    26.33
   Second Quarter    27.66    25.04
   Third Quarter    29.55    25.02
   Fourth Quarter    32.89    29.44

2011

   First Quarter    33.18    30.80
   Second Quarter    34.23    32.47
   Third Quarter    35.62    31.98
   Fourth Quarter    35.08    32.37

2012

   First Quarter    37.01    33.50
   Second Quarter    39.10    35.97
   Third Quarter    40.56    37.14
   Fourth Quarter    38.58    35.97

2013

   First Quarter (through the pricing date)    39.87    36.84

 

 

Autocallable Market-Linked Step Up Notes    TS-21


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

The Hershey Company

The Hershey Company manufactures chocolate and sugar confectionery products. The company’s principal products include chocolate and sugar confectionery products, gum and mint refreshment products, and pantry items, such as baking ingredients, toppings and beverages. This Basket Stock trades on the NYSE under the symbol “HSY”. The company’s CIK number is 047111.

 

              High ($)            Low ($)    

2008

   First Quarter    38.89    34.04
   Second Quarter    40.23    32.48
   Third Quarter    42.73    32.66
   Fourth Quarter    40.00    32.81

2009

   First Quarter    37.84    30.75
   Second Quarter    37.45    33.86
   Third Quarter    41.80    36.48
   Fourth Quarter    40.88    35.29

2010

   First Quarter    43.52    36.18
   Second Quarter    51.76    43.06
   Third Quarter    51.61    45.49
   Fourth Quarter    51.62    45.89

2011

   First Quarter    54.79    46.37
   Second Quarter    57.71    53.92
   Third Quarter    60.00    54.59
   Fourth Quarter    62.00    55.36

2012

   First Quarter    61.94    59.49
   Second Quarter    72.03    59.81
   Third Quarter    73.16    70.09
   Fourth Quarter    74.64    68.85

2013

   First Quarter (through the pricing date)    85.92    73.51

The Procter & Gamble Company

The Procter & Gamble Company manufactures and markets consumer products in countries throughout the world. The company provides products in the laundry and cleaning, paper, beauty care, food and beverage, and health care segments. The company’s products are sold primarily through mass merchandisers, grocery stores, membership club stores, drug stores, and neighborhood stores. This Basket Stock trades on the NYSE under the symbol “PG”. The company’s CIK number is 080424.

 

              High ($)            Low ($)    

2008

   First Quarter    72.60    64.68
   Second Quarter    71.14    60.49
   Third Quarter    73.15    61.98
   Fourth Quarter    71.44    57.37

2009

   First Quarter    62.80    44.18
   Second Quarter    54.02    47.25
   Third Quarter    58.16    51.11
   Fourth Quarter    63.19    56.62

2010

   First Quarter    64.53    59.84
   Second Quarter    63.94    59.79
   Third Quarter    63.08    59.34
   Fourth Quarter    65.24    59.96

2011

   First Quarter    66.70    59.73
   Second Quarter    67.46    61.67
   Third Quarter    64.95    58.51
   Fourth Quarter    66.97    61.00

2012

   First Quarter    67.90    62.77
   Second Quarter    67.56    59.27
   Third Quarter    69.76    61.19
   Fourth Quarter    70.76    66.32

2013

   First Quarter (through the pricing date)    77.58    68.51

 

 

Autocallable Market-Linked Step Up Notes    TS-22


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

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 will 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, 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.

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 to do. That estimate will be based upon the price that MLPF&S may pay for the notes in light of then-prevailing market conditions, our creditworthiness and transaction costs. At certain times, this price may be higher than or lower than the estimated initial value of the notes. For a short initial period after the issuance of the notes, at MLPF&S’s discretion, any purchase price paid by MLPF&S in the secondary market may be, in certain circumstances, closer to the amount that you paid for the notes than to their estimated initial value. However, neither we nor any of our affiliates is obligated to purchase your notes at any price, or at a price that exceeds their estimated initial value.

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.

Structuring the Notes

The notes are our debt securities, the return on which is linked to the level 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 and is generally lower by an amount ranging from 0.25% to 0.50% per annum (equivalent to $0.05 to $0.11 per unit) at the time we commence the offering of our market-linked notes. This generally relatively lower implied borrowing rate, which is reflected in the economic terms of the notes, along with the fees and charges associated with market-linked notes, resulted in the estimated initial value of the notes at the time the terms of the notes were set being less than their public offering price.

The amounts that we will pay on the notes will be based on the performance of the Basket and calculated based on the $10 per unit Original Offering Price. 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, the tenor of the note and the tenor of the hedging arrangements. The economic terms of the notes 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 the hedge providers.

The lower implied borrowing rate, the underwriting discount and the hedging-related costs and charges, reduce the economic terms of the notes to you and result in the estimated initial value for the notes (estimated at the time the terms of the notes were set) being less than the public offering price for the notes. For further information, see “Risk Factors — General Risks Relating to the Notes” beginning on page S-8 and “Use of Proceeds” on page S-16 of product supplement STOCK SUN-2.

 

 

Autocallable Market-Linked Step Up Notes    TS-23


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

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 callable single financial contract with respect to the Market Measure.

 

   

Under this characterization and tax treatment of the notes, a U.S. Holder (as defined beginning on page 62 of the prospectus) generally will recognize capital gain or loss upon maturity or upon a sale, exchange, or redemption 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 S-33 of product supplement STOCK SUN-2.

Validity of the Notes

In the opinion of McGuireWoods LLP, as counsel to BAC, when the trustee has made an appropriate entry on Schedule 1 to the Master Registered Global Senior Note, dated March 30, 2012 (the “Master Note”) identifying the notes offered hereby as supplemental obligations thereunder in accordance with the instructions of BAC, and the notes have been delivered against payment therefor as contemplated in this Note Prospectus, all in accordance with the provisions of the Senior Indenture, such notes will be legal, valid and binding obligations of BAC, subject to applicable bankruptcy, reorganization, insolvency, moratorium, fraudulent conveyance or other similar laws affecting the rights of creditors now or hereafter in effect, and to equitable principles that may limit the right to specific enforcement of remedies, and further subject to 12 U.S.C. §1818(b)(6)(D) (or any successor statute) and any bank regulatory powers now or hereafter in effect and to the application of principles of public policy. This opinion is given as of the date hereof and is limited to the federal laws of the United States, the laws of the State of New York and the Delaware General Corporation Law (including the statutory provisions, all applicable provisions of the Delaware Constitution and reported judicial decisions interpreting the foregoing). In addition, this opinion is subject to the assumption that the trustee’s certificate of authentication of the Master Note has been manually signed by one of the trustee’s authorized officers and to customary assumptions about the trustee’s authorization, execution and delivery of the Senior Indenture, the validity, binding nature and enforceability of the Senior Indenture with respect to the trustee, the legal capacity of natural persons, the genuineness of signatures, the authenticity of all documents submitted to McGuireWoods LLP as originals, the conformity to original documents of all documents submitted to McGuireWoods LLP as photocopies thereof, the authenticity of the originals of such copies and certain factual matters, all as stated in the letter of McGuireWoods LLP dated March 30, 2012, which has been filed as an exhibit to BAC’s Registration Statement relating to the notes filed with the SEC on March 30, 2012.

 

 

Autocallable Market-Linked Step Up Notes    TS-24


Autocallable Market-Linked Step Up Notes

Linked to a Basket of 23 Common Equity Securities, due March 28, 2016

    LOGO        

 

Where You Can Find More Information

We have filed a registration statement (including a product supplement, 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 calling MLPF&S toll-free at 1-866-500-5408.

Market-Linked Investments Classification

 

LOGO

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.

 

 

Autocallable Market-Linked Step Up Notes    TS-25