UBS plans 10.5%-12.5% yield optimization notes linked to U.S. Steel

By Angela McDaniels

Tacoma, Wash., Oct. 18 - UBS AG, London Branch plans to price 10.5% to 12.5% yield optimization notes with contingent protection due Oct. 26, 2011 linked to the common stock of United States Steel Corp., according to an FWP filing with the Securities and Exchange Commission.

The face amount of each note will be equal to the closing price of United States Steel stock on the pricing date.

Interest will be payable monthly. The exact coupon will be set at pricing.

If the final price of United States Steel stock is greater than or equal to 75% of the initial price, the payout at maturity will be par in cash. Otherwise, the payout will be one United States Steel share per note.

The notes (Cusip 90267F196) are expected to price Oct. 20 and settle Oct. 25.

UBS Financial Services Inc. and UBS Investment Bank are the underwriters.

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