New Issue: UBS prices $7.3 million auto-callable notes linked to Amex Gold Bugs

By Jennifer Chiou

New York, Sept. 27 - UBS AG priced a $7.3 million issue of 0% auto-callable notes due March 31, 2008 with contingent protection linked to the Amex Gold Bugs index, according to a 424B2 filing with the Securities and Exchange Commission.

The notes will automatically be called if the index level rises from the initial level on any of the quarterly observation dates between December 2006 and March 2008. The call return will be a simple return of 22% per year.

At maturity, if the index never closes below the contingent protection level, 80% of the initial level, investors will receive par. If the index closes at below the contingent protection level during the life of the notes and finishes below the initial level, investors will share in any losses.

Issuer:	UBS AG
Issue:	Auto-callable notes with contingent protection
Underlying index:	Amex Gold Bugs index
Amount:	$7.3 million
Coupon:	0%
Maturity:	March 31, 2008
Payout at maturity:	Par if the index never closes below the contingent protection level, 80% of the initial level; if the index closes at below the contingent protection level during the life of the notes and finishes below the initial level, investors will share in any losses
Call:	Automatic if the index level rises from the initial level on any of the quarterly observation dates between December 2006 and March 2008 at a simple return of 22% per year
Initial index level:	291.25
Contingent protection level:	233, 80% of the initial level
Pricing date:	Sept. 25
Settlement date:	Sept. 27
Underwriters:	UBS Investment Bank, UBS Financial Services Inc.

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