FWP

Final Term Sheet

Filed Pursuant to Rule 433

Registration Statement

No. 333-192369

September 30, 2015

United Parcel Service, Inc.

Floating Rate Notes

FINAL TERM SHEET

 

Security Offered:

Floating Rate Notes (the “Notes”)

 

Issuer:

United Parcel Service, Inc. (the “Company”)

 

Ratings:

Aa3/A+

 

Principal Amount:

$46,500,000

 

Trade Date:

September 30, 2015

 

Settlement Date:

October 5, 2015

 

Maturity:

September 15, 2065

 

Price to Public:

100.00% of face amount plus accrued interest from and including September 17, 2015 to and excluding the settlement date

 

Gross Spread:

1.00%

 

Price to Company:

99.00% of face amount plus accrued interest from and including September 17, 2015 to and excluding the settlement date

 

Net Proceeds to Company:

$46,035,000

 

Accrued Interest Payable to the Issuer:

$796.31 accrued from and including September 17, 2015 to and excluding the settlement date (0.0017125% of the face amount)

 

Base Rate:

LIBOR (Reuters Page LIBOR01)

 

Index Maturity:

3 month

 

Designated LIBOR Currency:

U.S. Dollars

 

Spread:

-0.30%

 

Initial Interest Rate:

3 month U.S. Dollar LIBOR as of September 15, 2015 minus 0.30%

 

Interest Reset Dates:

March 15, June 15, September 15, and December 15 of each year, commencing on December 15, 2015

 

Interest Determination Dates:

Quarterly, two London Banking Days prior to each Interest Reset Date

 

Interest Rate Reset Period:

Quarterly

 

Record Dates:

March 1, June 1, September 1 and December 1, of each year, commencing on December 1, 2015

 

Interest Payment Dates:

March 15, June 15, September 15, and December 15 of each year, commencing on December 15, 2015


Maximum Interest Rate:

N/A

 

Minimum Interest Rate:

0.00%

 

Minimum Denominations:

The Notes will be issued in denominations of $1,000 and in integral multiples of $1,000

 

CUSIP/ISIN:

911312 AT3 / US911312AT32

 

Put Provision:

The Notes will be repayable at the option of the holder on at least 30 days’ notice on the following days and at the following prices:

 

  Repayment Date                               Price

 

  September 15, 2016                        98.00%

 

  September 15, 2017                        98.00%

 

  September 15, 2018                        98.00%

 

  September 15, 2019                        98.00%

 

  September 15, 2020                        98.00%

 

  September 15, 2021                        99.00%

 

  September 15, 2022                        99.00%

 

  September 15, 2023                        99.00%

 

  September 15, 2024                        99.00%

 

  September 15, 2025                        99.00%

 

  September 15, 2026 and each

100.00% third anniversary

thereafter to September 15, 2062

 

Call Provision:

The Notes may be redeemed at any time, at the option of the Company, in whole or in part, in amounts of $1,000 or any multiple of $1,000 at the following redemption prices, if redeemed during the 12 month period beginning on September 15 of any of the following years:

 

  Redemption Date                              Price

 

  September 15, 2045                        105.00%

 

  September 15, 2046                        104.50%

 

  September 15, 2047                        104.00%

 

  September 15, 2048                        103.50%


  September 15, 2049                        103.00%

 

  September 15, 2050                        102.50%

 

  September 15, 2051                        102.00%

 

  September 15, 2052                        101.50%

 

  September 15, 2053                        101.00%

 

  September 15, 2054                        100.50%

 

  September 15, 2055 and                 100.00%

thereafter to maturity

 

Day Count Convention:

Actual/360

 

Form:

DTC, Book-Entry

 

Underwriters:

UBS Securities LLC
  Deutsche Bank Securities Inc.

Certain United States Federal Income Tax Considerations:

Notes Used as Qualified Replacement Property

Prospective investors seeking to treat the Notes as “qualified replacement property” for purposes of Section 1042 of the Internal Revenue Code of 1986, as amended (the “Code”), should be aware that Section 1042 requires the issuer to meet certain requirements in order for the Notes to constitute qualified replacement property. In general, qualified replacement property is a security issued by a domestic operating corporation that did not, for the taxable year preceding the taxable year in which such security was purchased, have “passive investment income” in excess of 25 percent of the gross receipts of such corporation for such preceding taxable year (the “passive income test”). For purposes of the passive income test, where the issuing corporation is in control of one or more corporations or such issuing corporation is controlled by one or more other corporations, all such corporations are treated as one corporation (the “affiliated group”) when computing the amount of passive investment income for purposes of Section 1042.

The Company believes that it qualifies as a domestic operating corporation and that less than 25 percent of its affiliated group’s gross receipts is passive investment income for the taxable year ended December 31, 2014. In making this determination, the Company has made certain assumptions and used procedures which it believes are reasonable. The Company cannot give any assurance as to whether it will continue to qualify as a domestic operating corporation or meet the passive income test. It is, in addition, possible that the Internal Revenue Service may disagree with the manner in which the Company has calculated the affiliated group’s gross receipts (including the characterization thereof) and passive investment income and the conclusions reached in this discussion. Prospective purchasers of the Notes should consult with their own tax advisors with respect to these and other tax matters relating to the Notes.

The Notes are securities with no established trading market. No assurance can be given as to whether a trading market for the Notes will develop or as to the liquidity of a trading market for the Notes. The availability and liquidity of a trading market for the Notes will also be affected by the degree to which purchasers treat the Notes as qualified replacement property.

Note: A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time.


The Issuer has filed a registration statement (including a prospectus) with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in that registration statement and other documents the Issuer has filed with the SEC for more complete information about the Issuer and this offering. You may get these documents for free by visiting EDGAR on the SEC Website at www.sec.gov.

Alternatively, the Issuer, any underwriter or any dealer participating in the offering will arrange to send you the prospectus if you request it by contacting UBS Securities LLC toll free at 1-888-827-7275; or Deutsche Bank Securities Inc. toll-free at 1-800-503-4611.

ANY DISCLAIMERS OR OTHER NOTICES THAT MAY APPEAR BELOW ARE NOT APPLICABLE TO THIS COMMUNICATION AND SHOULD BE DISREGARDED. SUCH DISCLAIMERS OR OTHER NOTICES WERE AUTOMATICALLY GENERATED AS A RESULT OF THIS COMMUNICATION BEING SENT VIA BLOOMBERG OR ANOTHER EMAIL SYSTEM.