Annual General Meeting 2005

Items

Item 5: Capital reduction

5.1. Cancellation of shares repurchased under the 2004/2005 share buyback program and respective amendment of article 4 of the Articles of Association

A. Motion
The Board of Directors proposes that 39,935,094 shares repurchased under the buyback program approved by the 2004 AGM be cancelled and the share capital of the Corporation accordingly reduced by CHF 31,948,075.20. Article 4 of the Articles of Association shall be amended as follows:

Current version

Proposed new version (changes in italics)

Article 4
Share capital

1
The share capital of the Corporation is CHF 901,486,541.60 (nine hundred and one million, four hundred and eighty-six thousand, five hundred and forty-one Swiss francs and sixty centimes), divided into 1,126,858,177 registered shares with a par value of CHF 0.80 each. The share capital is fully paid up.
2
unchanged

1
The share capital of the Corporation is CHF 869,538,466.40 (eight hundred and sixty-nine million, five hundred and thirtyeight thousand, four hundred and sixty-six Swiss francs and forty centimes), divided into 1,086,923,083 registered shares with a par value of CHF 0.80 each. The share capital is fully paid up.

B. Explanations
The AGM on 15 April 2004 authorized the Board of Directors to buy back UBS shares in a maximum amount of CHF 6 billion via a second trading line on the virt-x exchange and subsequently to cancel them. Until 28 February 2005 a total of 39,935,094 shares with an overall market value of CHF 3,543,091,266.90 were repurchased. The average purchase price was CHF 88.72 per share. The maximum amount authorized by the AGM was not fully consummated, as excess capital was used during the second half of the year to invest in attractive growth opportunities.

The Board of Directors now proposes to the AGM to approve the cancellation of the 39,935,094 shares repurchased and to reduce the share capital in Article 4 of the Articles of Association accordingly.

Ernst & Young Ltd. as Statutory Auditors have confirmed in a special audit report on behalf of the AGM that as at 31 December 2004 the claims of creditors were fully covered even after the reduction in capital and that the Bank has adequate liquidity.

5.2. Approval of a new 2005/2006 share buyback program

A. Motion
The Board of Directors proposes that the following resolution be approved:
"The Board of Directors shall be authorized to buy back a maximum amount of CHF 5 billion in UBS shares via a second trading line on the virt-x exchange. These shares are to be cancelled definitively and are not therefore regarded as own shares within the meaning of Article 659 of the Swiss Code of Obligations. The required amendment to the Articles of Association (reduction of share capital) will be submitted to the AGM in 2006 for approval."

B. Explanations
Shares shall be repurchased for cancellation if the firm's capitalization remains at its current high level. The Board of Directors requests the AGM to authorize the repurchase of a maximum amount of CHF 5 billion in UBS shares. The new buyback program 2005/2006 was announced on 8 February 2005.

The Board of Directors has again decided to proceed in two stages, with shareholders taking the decision in principle at the first AGM and deciding on the definitive cancellation of the shares at the next AGM. By obtaining shareholders' approval for the future cancellation of the repurchased shares, these shares no longer fall under the statutory limit of Swiss Company Law, which prohibits companies from holding more than 10% of their own shares. The proposed procedure provides greater flexibility, which UBS believes to be in the interests of efficient capital management and the ongoing trading activities of the Bank.

Ernst & Young Ltd. as Statutory Auditors have confirmed in a special audit report on behalf of the Board of Directors that the claims of creditors would be fully covered even after this additional capital reduction and that the Bank has adequate liquidity.