Pursuant to exemptive relief granted by the SEC from Rule 14e-5 under the U.S. Securities Exchange Act of 1934, as amended, and subject to certain enumerated conditions set forth in the exemptive relief letter, UBS, UBS’s subsidiaries and their respective affiliates and separately identifiable departments may conduct certain trading activities involving UBS Shares or derivatives related to such shares (including, without limitation, futures, forwards, options, swaps or similar instruments), both inside and outside the United States prior to and during the period in which the offer remains open for acceptance in the ordinary course of business. Additionally, these persons may engage in similar trading activities in UBS Group Shares once they are issued. In this section, we refer to the UBS Shares and UBS Group Shares collectively as the “relevant shares.” No such purchases or arrangements to purchase will be undertaken for the purpose of promoting or otherwise facilitating the exchange offer.
Among other things, UBS Group, UBS, UBS’s subsidiaries and their respective separately identifiable departments, as the case may be, intend (1) to make a market in the relevant shares by purchasing and selling the relevant shares for their own account or to facilitate customer transactions; (2) to make a market, from time to time, in derivatives (such as options, warrants, convertible securities and other instruments) relating to relevant shares for their own account and the accounts of their customers; (3) to engage in trades in relevant shares for their own account and the accounts of their customers for the purpose of hedging their positions established in connection with the derivatives market making described above; (4) to engage in unsolicited brokerage transactions in relevant shares with their customers; (5) to trade in relevant shares and derivatives on relevant shares as part of their investment management activities for the accounts of their customers; and (6) to trade in relevant shares in connection with employee incentive plans.
These activities may occur on the SIX Swiss Exchange, BATS Chi-X Europe, Scoach, in the over-the-counter market in Switzerland or elsewhere outside the United States of America. In addition, when and to the extent permitted by applicable law, UBS’s affiliated U.S. broker-dealers, UBS Securities LLC and UBS Financial Services, Inc., may engage in unsolicited brokerage transactions in relevant shares, and UBS’s investment management business groups may trade in relevant shares and derivatives on relevant shares, in the United States of America.
UBS and its affiliates are not obliged to make a market in or otherwise purchase relevant shares or derivatives on relevant shares and any such market making or other purchases may be discontinued at any time. These activities could have the effect of preventing or retarding a decline in the market price of the relevant shares.
In accordance with the requirements of Rule 14e-5 under the Exchange Act and with the exemptive relief granted by the SEC, where such purchases, or arrangements to purchase, take place outside the United States, they must comply with applicable Swiss law and rules or applicable relief that may be issued by the Swiss Takeover Board. With respect to purchases of UBS Shares and derivatives related to such shares outside the exchange offer made in reliance on the exemptive relief granted by the SEC, UBS will disclose promptly in the United States information regarding such purchases, to the extent such information is made public in Switzerland pursuant to the Swiss tender offer rules. Such disclosures may be found at the following location: http://www.takeover.ch/transactions/detail/nr/0572/lang/en
Between May 6, 2014, the date of the first public announcement of the exchange offer, and the date of this offer to exchange/prospectus, UBS, UBS’s subsidiaries and their respective affiliates and separately identifiable departments have, in the ordinary course of business and not for the purpose of promoting or otherwise facilitating the exchange offer, purchased and entered into arrangements to purchase the relevant shares, as permitted by the exemptive relief letter granted by the SEC.