Unassociated Document
| Filed
pursuant to Rule 433 |
| June
25, 2007 |
| Relating
to Preliminary Pricing Supplement No. 165
to |
| Registration
Statement Nos. 333-137691,
333-137691-02 |
| Dated
September 29,
2006 |
|
ABN
AMRO Bank N.V. Reverse Exchangeable
Securities
|
|
Preliminary
Pricing Sheet – June 25, 2007
|
|
|
19.25%
(ANNUALIZED)
THREE
MONTH
GMX
RESOURCES
INC. KNOCK-IN
REXSM
SECURITIES
DUE
OCTOBER
9,
2007
|
|
|
OFFERING
PERIOD:
JUNE
25,
2007 –
JUNE
29,
2007
|
|
| SUMMARY
INFORMATION |
| Issuer: |
ABN
AMRO Bank
N.V. (Senior Long Term Debt Rating: Moody’s Aa2, S&P AA-) |
| Lead
Agent: |
ABN
AMRO
Incorporated |
| Offerings: |
19.25%
(Annualized), Three Month Reverse Exchangeable Securities due October
9,
2007 |
| Interest
Payment Dates: |
Interest
on
the Securities is payable monthly in arrears on the 9th day of each
month
starting on |
| |
August
9, 2007
and ending on the Maturity Date |
| Underlying
Stock |
Ticker
|
Coupon
Rate
Per
annum*
|
Interest
Rate
|
Put
Premium
|
Knock-in
Level
|
CUSIP
|
ISIN
|
| GMX
Resources
Inc. |
GMXR
|
19.25%
|
5.26%
|
13.99%
|
80%
|
00078UNW6
|
US00078UNW61
|
| |
*This
Security
has a term of three months, so you will receive a pro rated amount
of this
perannum
rate
based on such three-month period. |
| Denomination/Principal: |
$1,000 |
| Issue
Price: |
100% |
| Payment
at
Maturity: |
The
payment at
maturity for each Security is based on the performance of the Underlying
Stocklinked
to such
Security: |
| |
i) |
If
the closing
price of the applicable Underlying Stock on the primary U.S. exchange
or
market for
such
Underlying Stock has not fallen below the applicable 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 applicable Underlying Stock on the primary U.S. exchange
or
market for
such
Underlying Stock has fallen below the applicable 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 applicable Underlying Stock
equal
to the applicable
Stock Redemption Amount, in the event that the closing price of the
applicable Underlying
Stock on the Determination Date is below the applicable 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
applicable Underlying Stock on the Determination Date is at or above
the
applicable
Initial Price.
|
| |
You
will
receive cash in lieu of fractional shares. |
| Initial
Price: |
100%
of the
Closing Price of the applicable Underlying Stock on the Pricing
Date. |
| Stock
Redemption Amount: |
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. |
| Knock-In
Level: |
A
percentage
of the applicable Initial Price as set forth in the table
above. |
|
Indicative
Secondary
Pricing:
|
•
Internet at: www.s-notes.com
Bloomberg at: REXS2 <GO>
|
| Status: |
Unsecured,
unsubordinated obligations of the Issuer |
| Trustee: |
Wilmington
Trust Company |
| Securities
Administrator: |
Citibank,
N.A. |
| Settlement: |
DTC,
Book
Entry, Transferable |
| Selling
Restrictions: |
Sales
in the
European Union must comply with the Prospectus Directive |
| Pricing
Date: |
June
29, 2007
subject to certain adjustments as described in the related pricing
supplement |
| Settlement
Date: |
July
9,
2007 |
| Determination
Date: |
October
3,
2007 subject to certain adjustments as described in the related pricing
supplement |
| Maturity
Date: |
October
9,
2007 (Three Month) |
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.
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
expect that
delivery of the Securities will be made against payment therefor on or about
the
closing date specified on the cover page of this pricing sheet, which will
be
the fifth Business Day following the Pricing Date of the Securities (this
settlement cycle being referred to as “T+5”). Under Rule 15c6-1 of the SEC under
the Securities Exchange Act of 1934, trades in the secondary market generally
are required to settle in three Business Days, unless the parties to that trade
expressly agree otherwise. Accordingly, purchasers who wish to trade the
Securities on the Pricing Date or the next succeeding Business Day will be
required, by virtue of the fact that the Securities initially will settle in
T+5, to specify an alternate settlement cycle at the time of any such trade
to
prevent a failed settlement and should consult their own advisor.
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?
If
the closing price
of the Underlying Stock linked to a Security on the relevant exchange has not
fallen below the applicable 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”), at maturity we will pay you the principal amount of such
Security in cash.
If,
on the other
hand, 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, at maturity we will either:
|
•
|
deliver
to you
a fixed number of shares of such Underlying Stock, which we call
the Stock
Redemption Amount, in exchange for such Security, in the event that
the
closing price of such Underlying Stock is below the applicable Initial
Price on the Determination Date; or
|
|
•
|
pay
you the
principal amount of such Security in cash, in the event that the
closing
price of such Underlying Stock is at or above the applicable Initial
Price
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.
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. 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 at the time you receive those shares 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.
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
ABN
AMRO does not
intend to list the Securities 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 limited. 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.
Reverse
Exchangeable
is a Service Mark of ABN AMRO Bank N.V.