Extraordinary General Meeting of UBS AG
At the Extraordinary General Meeting on 27 February 2008, the shareholders of UBS AG approved the proposal by the Board of Directors to create conditional share capital for the issuance of mandatory convertible notes. They also approved the Board of Directors' proposal to replace the cash dividend with a stock dividend. The special audit proposed by Ethos and Pictet Funds S.A. into UBS AG's exposure to the US mortgage market failed to gain an absolute majority. 6,454 shareholders attended the Extraordinary General Meeting, representing 710,145,376 votes.
At the Extraordinary General Meeting on 27 February 2008 in Basel, the shareholders of UBS AG approved the issuance of mandatory convertible notes and the distribution of a stock dividend. Both measures are key components of the program announced on 10 December 2007 to strengthen UBS AG's capital base.
UBS shareholders approved the creation of conditional share capital for the issuance of mandatory convertible notes with a value of CHF 13 billion to the Government of Singapore Investment Corporation Pte. Ltd. and an investor from the Middle East. The proposal received 87.18% of the votes cast. The minimum conversion price is CHF 51.48 and the maximum conversion price has been set at 117% of that figure, namely CHF 60.23.
Marcel Ospel, Chairman of the UBS Board of Directors, thanked shareholders for their trust and their far-sighted decision, and described the capital increase as a "correct and important step in securing the future development of UBS."
UBS shareholders will receive a stock dividend in the form of bonus shares rather than a cash dividend for 2007. They voted in favor of the Board of Directors' proposal for the creation of authorized capital, which received 95.16% of the votes cast. This will result in a CHF 4.4 billion increase in Tier 1 capital.
UBS shareholders rejected the proposal to conduct a special audit into the effects of the dislocations in the US mortgage market on UBS AG and the root causes of UBS AG's large exposure in this area. The proposal by Ethos and Pictet Funds S.A. received 44.49% of the votes cast, with shareholders accepting the Board of Directors' motion to reject it. UBS AG had previously responded publicly to the request by Ethos and Pictet Funds S.A. for information on the effects on its business of the turbulence in the US mortgage market. The Board of Directors fully supports a further clarification of the effects of the US mortgage crisis on UBS AG and the root causes of UBS AG's large exposure in this area. An investigation by the Swiss Federal Banking Commission (SFBC) has been under way for some weeks now.
Further information and the speech by Marcel Ospel can be found on the Internet at www.ubs.com/egm.
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