Item 2: Payment of a partial dividend
The Board of Directors proposes that UBS shareholders on record as of 2 October 2000 be paid a partial dividend of CHF 4.50 for the first nine months of the year out of free reserves of UBS AG or the Available Earnings respectively.
The payment of a partial dividend to current shareholders of UBS is intended to create an equal treatment of UBS shareholders and PaineWebber stockholders, as it is intended that PaineWebber stockholders will have been paid dividends for nine months at the moment of the exchange of PaineWebber shares.
Given the earnings development in the current year, the Board of Directors would - from today's perspective - propose to the Ordinary General Meeting in April 2001 the appropriation of a dividend of CHF 6 per share. For the nine months through to September this is equivalent to CHF 4.50 per share.
The amount of around CHF 1.8 billion needed for this dividend payment has to be charged to the free reserves of UBS AG and will be transferred to the Available Earnings. The payment of an interim dividend or a quarterly dividend in the proper meaning of the word is not permitted under Swiss Company Law. The Statutory Auditors ATAG Ernst & Young AG confirm in their statement on behalf of the
Extraordinary General Meeting of Shareholders that the proposal of the Board of Directors complies with the Swiss Company Law and the company's Articles of Association.
The Ordinary General Meeting of Shareholders of 26 April 2001 will have to decide on the remaining dividend for the current year. The Board of Directors will most likely propose the appropriation of an additional CHF 1.50 per share.
If the Extraordinary General Meeting approves the proposal, the partial dividend of CHF 4.50 per share (CHF 2.925 after deduction of 35% Swiss withholding tax) will be paid on 5 October 2000 to all UBS shareholders on record as of 2 October.