New Issue: UBS prices $294,000 13.75% reverse convertibles linked to Freeport-McMoRan

By Angela McDaniels

Tacoma, Wash., Aug. 27 - UBS AG priced $294,000 of reverse convertible notes due Nov. 30, 2009 linked to the common stock of Freeport-McMoRan Copper & Gold Inc., according to a 424B2 filing with the Securities and Exchange Commission.

The three-month notes pay 3.4375% for an annualized coupon of 13.75%. Interest is payable monthly.

The payout at maturity will be par unless Freeport-McMoRan stock falls below the trigger price - 70% of the initial share price - during the life of the notes and finishes below the initial price, in which case investors will receive a number of Freeport-McMoRan shares equal to $1,000 divided by the initial price.

UBS Securities LLC is the underwriter.

Issuer:	UBS AG
Issue:	Reverse convertible notes
Underlying stock:	Freeport-McMoRan Copper & Gold Inc. (NYSE: FCX)
Amount:	$294,000
Maturity:	Nov. 30, 2009
Coupon:	13.75%, payable monthly
Price:	Par
Payout at maturity:	If Freeport-McMoRan stock falls below trigger price during life of notes and finishes below initial price, 15.840 Freeport-McMoRan shares; otherwise, par
Initial share price:	$63.13
Trigger price:	$44.19, 70% of initial share price
Pricing date:	Aug. 26
Settlement date:	Aug. 31
Underwriter:	UBS Securities LLC
Fees:	2.25%

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