Filed
pursuant to Rule 433
April
20, 2008
Relating
to Preliminary Pricing Supplement No. 857 to
Registration
Statement Nos. 333-137691, 333-137691-02
Dated
September
29, 2006
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ABN AMRO Bank N.V. Reverse
Exchangeable Securities
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Preliminary Pricing Sheet
– April 20,
2009
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18.50%
(PER
ANNUM),
ONE
YEAR
General
Electric Company KNOCK-IN
REXSM
SECURITIES
DUE
APRIL
30,
2010
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OFFERING
PERIOD: APRIL 20, 2009 – APRIL 27,
2009
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SUMMARY
INFORMATION
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Issuer:
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ABN AMRO Bank N.V. (Senior Long
Term Debt Rating: Moody’s Aa2, S&P
A+)**
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Lead Agent:
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ABN AMRO
Incorporated
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Offerings:
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18.50% (Per Annum), One Year
Reverse Exchangeable Securities due April 30, 2010 linked to the
Underlying Stock set forth in the table below.
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Interest Payment
Dates:
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Interest on the Securities is
payable monthly in arrears on the last day of each month starting on May
31, 2009 and ending on the Maturity Date.
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Underlying
Stock
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Ticker
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Coupon Rate
Per annum
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Interest
Rate
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Put Premium
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Knock-in
Level
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CUSIP
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ISIN
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General Electric
Company
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GE
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18.50%
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1.85%
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16.65%
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60%
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00083JAC2
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US00083JAC27
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Denomination/Principal:
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$1,000
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Issue
Price:
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100%
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Payment at
Maturity:
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The payment at maturity for each
Security is based on the performance of the Underlying Stock linked to
such Security:
i) If the
closing price of the Underlying Stock on the primary U.S. exchange or
market for such Underlying Stock has not fallen below the Knock-In Level on any trading
day from but not including the Pricing Date to and including the
Determination Date, we will pay you the principal amount of each Security
in cash.
ii) If the closing
price of the Underlying Stock on the primary U.S. exchange or market for such Underlying
Stock has fallen below the Knock-In Level on any trading day from but not
including the Pricing Date to and including the Determination
Date:
a) we will deliver to
you a number of shares of the Underlying Stock equal to the Stock Redemption Amount, in the
event that the closing price of the Underlying Stock on the Determination
Date is below the Initial Price; or
b) We will pay you the
principal amount of each Security in cash, in the event that the closing
price of the Underlying Stock on the Determination
Date is at or above the Initial Price.
You will receive cash in lieu of
fractional shares. If due to events beyond our reasonable control, as
determined by us in our sole discretion, shares of the Underlying Stock
are not available for delivery at maturity
we may pay you, in lieu of the Stock Redemption Amount, the cash value of
the Stock Redemption Amount, determined by multiplying the Stock
Redemption Amount by the Closing Price of the Underlying Stock on the
Determination Date.
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Initial
Price:
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100% of the Closing Price of the
applicable Underlying Stock on the Pricing Date.
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Stock Redemption
Amount:
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For each $1,000 principal amount
of Security, a number of shares of the applicable Underlying Stock linked
to such Security equal to $1,000 divided by the applicable Initial
Price.
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Knock-In
Level:
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A percentage of the applicable
Initial Price as set forth in the table above.
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Indicative Secondary
Pricing:
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• Internet at: www.s-notes.com
Bloomberg at: REXS2
<GO>
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Status:
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Unsecured, unsubordinated
obligations of the Issuer
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Trustee:
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Wilmington Trust
Company
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Securities
Administrator:
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Citibank,
N.A.
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Settlement:
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DTC, Book Entry,
Transferable
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Selling
Restrictions:
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Sales in the European Union must
comply with the Prospectus Directive
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Proposed Pricing
Date:
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April 27, 2009 subject to certain
adjustments as described in the related pricing
supplement
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Proposed Settlement
Date:
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April 30,
2009
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Determination
Date:
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April
27, 2010 subject
to certain adjustments as described in the related pricing
supplement |
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Maturity
Date:
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April
30, 2010 (One
Year) |
ABN
AMRO has filed a registration statement (including a Prospectus and Prospectus
Supplement) with the SEC for the offering to which this communication relates.
Before you invest, you should read the Prospectus and Prospectus Supplement in
that registration statement and other documents ABN AMRO has filed with the SEC
for more complete information about ABN AMRO and the offering of the
Securities.
You
may get these documents for free by visiting EDGAR on the SEC website at
<www.sec.gov> or by visiting ABN AMRO Holding N.V. on the SEC website at
<http://www.sec.gov/cgi-bin/browse-edgar?company=&CIK=abn&filenum=&State=&SIC=&owner=include&action=get
company>. Alternatively, ABN AMRO, any underwriter or any dealer
participating in the offering will arrange to send you the Prospectus and
Prospectus Supplement if you request it by calling toll free (866)
747-4332.
These
Securities may not be offered or sold (i) to any person/entity listed on
sanctions lists of the European Union, United States or any other applicable
local competent authority; (ii) within the territory of Cuba, Sudan, Iran and
Myanmar; (iii) to residents in Cuba, Sudan, Iran or Myanmar; or (iv)
to Cuban Nationals, wherever located.
We
reserve the right to withdraw, cancel or modify any offering and to reject
orders in whole or in part.
**A
credit rating (1) is subject to revision, suspension or withdrawal at any time
by the assigning rating organization, (2) does not take into account market risk
or the performance related risks of investing in the Securities, and (3) is not
a recommendation to buy, sell or hold the Securities.
SUMMARY
The
following summary does not contain all the information that may be important to
you. You should read this summary together with the more detailed information
that is contained in the related Pricing Supplement and in its accompanying
Prospectus and Prospectus Supplement. You should carefully consider, among other
things, the matters set forth in “Risk Factors” in the related Pricing
Supplement, which are summarized on page 5 of this document. In
addition, we urge you to consult with your investment, legal, accounting, tax
and other advisors with respect to any investment in the
Securities.
What
are the Securities?
The Securities are
interest paying, non-principal protected securities issued by us, ABN AMRO Bank
N.V., and are fully and unconditionally guaranteed by our parent company, ABN
AMRO Holding N.V. The Securities are senior notes of ABN AMRO Bank N.V. These
Securities combine certain features of debt and equity by offering a fixed
interest rate on the principal amount while the payment at maturity is
determined based on the performance of the Underlying Stock to which it is
linked.
What
will I receive at maturity of the Securities?
The payment at
maturity of each Security will depend on (i) whether or not the closing price of
the Underlying Stock to which such Security is linked fell below the knock-in
level on any trading day from but not including the pricing date to and
including the determination date (such period, the “Knock-in Period"), and if
so, (ii) the closing price of the applicable Underlying Stock on the
determination date. To determine closing prices, we look at the
prices quoted by the relevant exchange.
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•
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If the
closing price of the applicable Underlying Stock on the relevant exchange
has not fallen below the applicable knock-in level on any trading day
during the Knock-in Period, we will pay you the principal amount of each
Security in cash.
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•
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If the
closing price of the applicable Underlying Stock on the relevant exchange
has fallen below the applicable knock-in level on any trading day during
the Knock-in Period, we will
either:
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•
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deliver to
you the applicable stock redemption amount, in exchange for each Security,
in the event that the closing price of the applicable Underlying Stock is
below the applicable initial price on the determination date;
or
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•
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pay you the
principal amount of each Security in cash, in the event that the closing
price of the applicable Underlying Stock is at or above the applicable
initial price on the determination
date.
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If
due to events beyond our reasonable control, as determined by us in our sole
discretion, shares of the applicable Underlying Stock are not available for
delivery at maturity we may pay you, in lieu of the applicable Stock Redemption
Amount, the cash value of the applicable Stock Redemption Amount, determined by
multiplying the applicable Stock Redemption Amount by the
Closing Price of the applicable Underlying Stock on the Determination
Date.
Why
is the interest rate on the Securities higher than the interest rate payable on
your conventional debt securities with the same maturity?
The Securities
offer a higher interest rate than the yield that would be payable on a
conventional debt security with the same maturity issued by us or an issuer with
a comparable credit rating. This is because you, the investor in the Securities,
indirectly sell a put option to us on the shares of the applicable Underlying
Stock. The premium due to you for this put option is combined with a market
interest rate on our senior debt to produce the higher interest rate on the
Securities. As explained below under "What are the consequences of the indirect
put option that I have sold you?" you are being paid the premium for taking the
risk that you may receive Underlying Stock with a market value less than the
principal amount of your Securities at maturity, which would mean that you would
lose some or all of your initial principal investment.
What
are the consequences of the indirect put option that I have sold
you?
The put option you
indirectly sell to us creates the feature of exchangeability. This feature could
result in the delivery of Underlying Stock to you, at maturity, with a market
value which is less than the principal amount of $1,000 per Security. If the
closing price of the applicable Underlying Stock on the relevant exchange falls
below the applicable Knock-In Level on any trading day during the Knock-In
Period, and on the Determination Date the closing price of the applicable
Underlying Stock is less than the applicable Initial Price, you will receive the
applicable Stock Redemption Amount. The market value of the shares of
such Underlying Stock on the Determination Date will be less than the principal
amount of the Securities and could be zero. Therefore you are not guaranteed to
receive any return of principal at maturity. If the price of the
Underlying Stock rises above the initial price you will not participate in any
appreciation in the price of the Underlying Stock.
How
is the Stock Redemption Amount determined?
The Stock
Redemption Amount for each $1,000 principal amount of any Security is equal to
$1,000 divided by the Initial Price of the Underlying Stock linked to such
Security. The value of any fractional shares of such Underlying Stock that you
are entitled to receive, after aggregating your total holdings of the Securities
linked to such Underlying Stock, will be
paid in cash based
on the closing price of such Underlying Stock on the Determination
Date.
What
interest payments can I expect on the Securities?
The interest rate
is fixed at issue and is payable in cash on each interest payment date,
irrespective of whether the Securities are redeemed at maturity for cash or
shares.
Can
you give me an example of the payment at maturity?
If, for example, in
a hypothetical offering, the interest rate was 10% per annum, the initial price
of a share of underlying stock was $45.00 and the knock-in level for such
offering was 80%, then the stock redemption amount would be 22.222 shares of
underlying stock, or $1,000 divided by $45.00, and the knock-in level would be
$36.00, or 80% of the initial price.
If
the closing price of that hypothetical underlying stock fell below the knock-in
level of $36.00 on any trading day during the Knock-in Period, then the payment
at maturity would depend on the closing price of the underlying stock on the
determination date. In this case, if the closing price of the underlying stock
on the determination date is $30.00 per share at maturity, which is below the
initial price level, you would receive 22.222 shares of underlying stock for
each $1,000 principal amount of the securities. (In actuality, because we cannot
deliver fractions of a share, you would receive on the maturity date for each
$1,000 principal amount of the securities 22 shares of underlying stock plus
$6.66 cash in lieu of 0.222 fractional
shares, determined by multiplying 0.222 by $30.00,
the closing price per shares of underlying stock on the determination date.) In
addition, over the life of the securities you would have received interest
payments at a rate of 10% per annum. In this hypothetical example, the
market value of those 22 shares of underlying stock (including the cash paid in
lieu of fractional shares) that we would deliver to you at maturity for each
$1,000 principal amount of security would be $666.66, which is less than the
principal amount of $1,000, and you would have lost a portion of your initial
investment. If, on the other hand, the closing price of the
underlying stock on the determination date is $50.00 per share, which is above
the initial price level, you will receive $1,000 in cash for each $1,000
principal amount of the securities
regardless of the knock-in level having been breached. In addition, over the
life of the Securities you would have received interest payments at a rate of
10% per annum.
Alternatively, if
the closing price of the underlying stock never falls below $36.00, which is the
knock-in level, on any trading day during the Knock-in Period, at maturity you
will receive $1,000 in cash for each security you hold regardless of the closing
price of the underlying stock on the determination date. In addition, over the
life of the securities you would have received interest payments at a rate of
10% per annum.
This example is for illustrative
purposes only and is based on a hypothetical offering. It is not
possible to predict the closing price of any of the Underlying Stocks on the
determination date or at any time during the life of the Securities. For
each offering, we will set the Initial Price, Knock-In Level and Stock
Redemption Amount on the Pricing Date.
Do
I benefit from any appreciation in the Underlying Stock over the life of the
Securities?
No. The amount paid
at maturity for each $1,000 principal amount of the Securities will not exceed
$1,000.
What
if I have more questions?
You should read the
“Description of Securities” in the related Pricing Supplement for a detailed
description of the terms of the Securities. ABN AMRO has filed a
registration statement (including a Prospectus and Prospectus Supplement) with
the SEC for the offering to which this communication relates. Before you invest,
you should read the Prospectus and Prospectus Supplement in that registration
statement and other documents ABN AMRO has filed with the SEC for more complete
information about ABN AMRO and the offering of the Securities. You
may get these documents for free by visiting EDGAR on the SEC web site at
www.sec.gov. Alternatively, ABN AMRO, any underwriter or any dealer
participating in the offering will arrange to send you the Prospectus and
Prospectus Supplement if you request it by calling toll free (888)
644-2048.
RISK
FACTORS
Investors
should carefully consider the risks of the Securities to which this
communication relates and whether these Securities are suited to their
particular circumstances before deciding to purchase them. It is
important that prior to investing in these Securities investors read the Pricing
Supplement related to such Securities and the accompanying Prospectus and
Prospectus Supplement to understand the actual terms of and the risks associated
with the Securities. In addition, we urge investors to consult with
their investment, legal, accounting, tax and other advisors with respect to any
investment in the Securities.
Credit
Risk
The
Securities are issued by ABN AMRO Bank N.V. and guaranteed by ABN AMRO Holding
N.V., ABN AMRO’s
parent. As a result, investors assume the credit risk
of ABN AMRO Bank N.V. and that of ABN AMRO Holding N.V. in the event that ABN
AMRO defaults on its obligations under the Securities. Any obligations or
Securities sold, offered, or recommended are not deposits on ABN AMRO Bank N.V.
and are not endorsed or
guaranteed by any bank or thrift, nor are they insured by the FDIC or any
governmental agency.
Principal
Risk
The
Securities are not ordinary debt securities: they are not principal
protected. In addition, if the closing price of the applicable
Underlying
Stock falls below the applicable Knock-In Level on any trading day during the
Knock-In Period, investors in the Securities will be exposed to any decline in
the price of the applicable Underlying Stock below the closing price of such
Underlying Stock
on the date the Securities were priced. Accordingly,
investors may lose some or all of their initial investment in the
Securities.
Limited
Return
The
amount payable under the Securities will never exceed the original principal
amount of the Securities plus the applicable aggregate fixed coupon payment
investors earn during the term of the Securities. This means that
investors will not benefit from any
price appreciation in the applicable Underlying Stock, nor will they receive
dividends paid on the applicable Underlying Stock, if
any. Accordingly, investors will never receive at maturity an amount
greater than a predetermined amount per Security, regardless
of how much the price of the applicable Underlying Stock increases during the
term of the Securities or on the Determination Date. The return of a
Security may be significantly less than the return of a direct investment in the
Underlying Stock to
which the Security is linked during the term of the
Security.
Liquidity
Risk
The
Securities will not be listed on any securities
exchange. Accordingly, there may be little or no secondary market for
the Securities and information regarding independent
market pricing of the Securities may be very limited or non-existent. The value
of the Securities in the secondary market, if any, will be subject to many
unpredictable factors, including then prevailing market
conditions.
It
is important to note that many
factors will contribute to the secondary market value of the Securities, and
investors may not receive their full principal back if the Securities are sold
prior to maturity. Such
factors include, but are not limited to, time to maturity, the price
of
the applicable Underlying Stock, volatility and interest
rates.
In
addition, the price, if any, at which we or another party are willing to
purchase Securities in secondary market transactions will likely be lower than
the issue price, since the issue price
included, and secondary market prices are likely to exclude, commissions,
discounts or mark-ups paid with respect to the Securities, as well as the cost
of hedging our obligations under the Securities.
Tax
Risk
Pursuant
to the terms of the Knock-in Reverse
Exchangeable Securities, we and every investor agree to characterize the
Securities as consisting of a Put Option and a Deposit of cash with the
issuer. Under this characterization, a portion of the stated interest
payments on each Security is treated
as interest on the Deposit, and the remainder is treated as attributable to a
sale by the investor of the Put Option to ABN AMRO (referred to as Put
Premium). Receipt of the Put Premium will not be taxable upon
receipt.
If
the Put Option expires unexercised
(i.e., a cash payment of the principal amount of the Securities is made to the
investor at maturity), the investor will recognize short-term capital gain equal
to the total Put Premium received. If the Put Option is exercised
(i.e., the final payment
on the Securities is paid in the applicable Underlying Stock), the investor will
not recognize any gain or loss in respect of the Put Option, but the
investor’s
tax basis in the applicable Underlying Stock received will be reduced by the Put
Premium
received.
Significant
aspects of the U.S. federal income tax treatment of the Securities are
uncertain, and no assurance can be given that the Internal Revenue Service will
accept, or a court will uphold, the tax treatment described
above.
This
summary is limited to the federal tax issues addressed
herein. Additional issues may exist that are not addressed in this
summary and that could affect the federal tax treatment of the
transaction. This tax summary was written in connection with
the promotion
or marketing by ABN AMRO Bank N.V.
and the placement agent of the Knock-in Reverse Exchangeable Securities, and it
cannot be used by any investor for the purpose of avoiding penalties that may be
asserted against the investor under the Internal Revenue
Code. Investors
should seek their own advice based on their particular circumstances from an
independent tax advisor.
On
December 7, 2007, the U.S. Treasury and the Internal Revenue Service released a
notice requesting comments on the U.S. federal income tax treatment of
“prepaid
forward contracts” and
similar instruments. While it is not entirely clear whether the
Securities
are among the instruments described in the notice, it is possible that any
Treasury regulations or other guidance issued after consideration of the issues
raised in the notice could materially and adversely affect the tax consequences
of ownership and
disposition of the Securities, possibly on a retroactive
basis.
The
notice indicates that it is possible the IRS may adopt a new position with
respect to how the IRS characterizes income or loss (including, for example,
whether the option premium might be
currently included as ordinary income) on the Securities for U.S. holders of the
Securities.
You
should consult your tax advisor regarding the notice and its potential
implications for an investment in the Securities.
Reverse
Exchangeable is a Service Mark
of ABN AMRO Bank N.V.
5