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Subject:  Re: tough times for yield Date:  3/29/2013  6:36 PM
Author:  TMFRichDad Number:  14065 of 25354

Hi Kit,

Quantum is up and running again.

Here's the low down on JPM-X:

Ticker Symbol: JPM-X CUSIP: 46626X203 Exchange: NYSE
Security Type: Trust Preferred Security

QUANTUMONLINE.COM SECURITY DESCRIPTION: JPMorgan Chase Capital XII, 6.25% Capital Securities, Series L, liquidation amount $25 per share, guaranteed by JPMorgan Chase & Co. (NYSE: JPM) (See our definition of Guaranteed in our Glossary of Income Investing Terms for the technicalities of the guarantee), redeemable at the issuer's option on or after 10/15/2008 at $25 per share plus accrued and unpaid dividends, maturing 10/15/2033, distributions of 6.25% ($1.5625) per annum are paid quarterly on 1/15, 4/15, 7/15 & 10/15 to holders of record one business day prior to the payment date while the securities remain in book-entry form. The company has the right, at any time, to defer dividend payments for up to 20 consecutive quarters (but not beyond the maturity date). The trust's assets consist of the 6.25% Junior Subordinated Deferrable Interest Debentures, Series L, due 10/15/2033 which were purchased from the company using the funds generated from the sale of the trust preferred securities. See the IPO prospectus for further information on the trust preferred securities by clicking on the ‘Link to IPO Prospectus’ provided below.

Stock Cpn Rate LiqPref Call Date Moodys/S&P Distribution Dates 15%
Exchange Ann Amt CallPrice Matur Date Dated Tax Rate
NYSE 6.25% $25.00 10/15/2008 Baa2 / BBB 1/15, 4/15, 7/15 & 10/15 No
Chart $1.56 $25.00 10/15/2033 3/4/2013

Is the 15% tax rate eligibility important to your parents? JPM-X is not eligible meaning that whatever their income tax rate is is what they'll pay. So, if they are in a higher bracket than it might be worthwhile to look for something eligible for the lower rate.

If it is important, I could search around on Quantum for some other issues that are eligible for the 15% rate. Not sure what the yields are these days. It's been a while.

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