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EXHIBIT 4.2
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ORGANIZATION REGULATIONS
OF UBS AG
Based on art. 716b of the Swiss Code of Obligations and art. 24 of the
Articles of Association of UBS AG, the Board of Directors has issued the
following Organization Regulations on September 14, 2000.
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The "Appendix" (Authorities) is an integrated part of these Organization
Regulations
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I. THE BOARD OF DIRECTORS
Art. 1 Constitution
(1)The Board of Directors constitutes itself in the last meeting preceding the
Annual General Meeting of Shareholders (subject to approval of elections at the
AGM).
(2)The Board elects its Chairman and at least one Vice Chairman, and appoints
its Secretary.
Art. 2 Meetings and invitations to convene
(1)The Board meets as prescribed by art. 21 of the Articles of Association.
(2)Except in urgent cases the invitations to the meeting, together with the
agenda, are sent to the directors at least one week before the date of the
meeting.
(3)As a rule, the members of the Group Executive Board participate in board
meetings in an advisory capacity. The presiding director decides where
exceptions will be made. Together with the President of the Group Executive
Board (President), the presiding director determines whether other persons may
attend.
Art. 3 Decisions and minutes
The Board takes its decisions as prescribed by art. 22 of the Articles of
Association. As an exception, directors may participate in meetings via
telephone or video. They are counted as present in such cases.
(2)In urgent cases decisions may be taken via circular mail. Such decisions are
only valid when all directors are sent the text of the resolution, when more
than two thirds of the directors cast a vote, and when the absolute majority of
directors voting approve the resolution submitted to them. Any dissenting
director is entitled to request a meeting to be convened. In such a case the
decision via circular mail is not valid.
(3)Minutes are kept of decisions taken by the Board and are signed by the
presiding director and the Secretary. They shall be made available for
inspection before the next board meeting and shall be approved at this meeting.
(4)Any member of the Board may demand that his/her dissenting vote be noted in
the minutes. Directors are any time entitled to examine the minutes.
Art. 4 Functions and authorities
(1)The functions and authorities of the Board are based on the provisions
contained in arts. 23 - 28 of the Articles of Association. All details are
governed in the "Appendix".
Art. 5 Right to information and examination
(1)At a meeting, any member of the Board is entitled to demand information on
any matter relating to the Group regardless of what is on the agenda. The other
directors and any members of the Group Executive Board that are present shall
provide such information to the best of their knowledge.
(2)If a director has the matter on which he or she is seeking information placed
on the agenda, the Chairman's Office shall arrange through the President of the
Group Executive Board for a knowledgeable member of staff to provide
comprehensive information on this matter.
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(3)Where it is imperative for compliance with his/her duties any director may
request information outside of meetings from members of the Group Executive
Board concerning the Group's business development. Requests to examine books and
files must be made in writing to the Chairman's Office. The director who makes
such a request must examine the documents in person. Where the Chairman's Office
rejects a request to examine books and files, the director making the request
may submit it to the Board.
Art. 6 Term of office, end of active service
(1)A director who has reached the age of seventy automatically retires from the
Board with effect from the next Annual General Meeting of Shareholders.
(2)A director who has ended his or her active involvement in the company or
organization of which he or she used to be a representative shall offer to
vacate his or her directorship. The Board decides whether a resignation is to be
submitted or whether the director may exercise the mandate until completion of
his/her term of office.
II. THE CHAIRMAN'S OFFICE
Art. 7 Composition
The Board of Directors establishes a Chairman's Office, composed of the Chairman
and at least one Vice Chairman.
Art. 8 Meetings
(1)As a rule the Chairman's Office meets four to six times a year to deal with
the issues of its authority. The President participates at these meetings in an
advisory capacity. Other members of the Group Executive Board may be invited to
participate for special purposes.
(2)The Chairman and/or the full-time Vice Chairman participate in the meetings
of the Group Executive Board. Such participation serves to ensure that the Board
is apprised of current developments and permits the exercise of its supervisory
and control functions. The Chairman and the full-time Vice Chairman participate
in these meetings in an advisory capacity.
Art. 9 Decisions and minutes
(1)The presence of the Chairman and one Vice Chairman is required for
resolutions to be passed at meetings of the Chairman's Office.
(2)Minutes are kept on the resolutions passed and are signed by the Chairman and
the Secretary. The minutes are sent to the members of the Chairman's Office and
the President. They are then made available for perusal at the following Board
of Directors' meeting.
Art. 10 Functions and authorities
(1)The authorities of the Chairman's Office are governed in detail in the
"Appendix". In addition it has responsibility for preparing proposals to be
submitted to the Board of Directors and for monitoring the implementation of the
Board of Directors' decisions.
(2)As an exception, urgent decisions falling within the authority of the Board
of Directors may be taken by the Chairman's Office. Such decisions are to be
brought to the attention of the Board of Directors at
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its next meeting. This regulation shall not apply to such functions and duties
of the Board of Directors which, pursuant to art. 716a of the Swiss Code of
Obligations, are non-transferable and inalienable.
(3)The credit approval authorities of the Chairman's Office can be delegated to
the full-time Vice Chairman who brings his decisions to the next meeting of the
Chairman's Office for information. Extraordinary cases will be submitted to
circular approval by all members of the Chairman's Office.
Art. 11 The Chairman's Office as Audit Supervisory Board
(1)The Chairman's Office performs the duties as Audit Supervisory Board as
defined in the Federal Banking Commission's circular letter on internal auditing
dated 14 December 1995. In this function, the Chairman's Office shall convene
four times a year for special meetings with the Head of Group Internal Audit. In
at least one of the meetings the representatives of the External Auditors shall
participate.
(2)At these meetings, the objectives for the year and the activity report of the
Head of Group Internal Audit will be discussed. The meetings also serve to
discuss matters of general policy and to inform the Chairman's Office of
important findings made by Group Internal Audit.
Art. 12 The Chairman's Office as Compensation Committee
The Chairman's Office performs the duties as Compensation Committee for the
Group Executive Board and the Group Managing Board. Its authorities are governed
in detail in the "Appendix".
III. THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
Art. 13 Functions and authorities
The Board of Directors appoints an Audit Committee of three of its part-time
members to control the functional quality and the performance adequacy of the
Group and Statutory Auditors as well as their interaction with Group Internal
Audit. Authorities, duties and procedures are governed in a special regulation
issued by the Board of Directors.
IV. THE CHAIRMAN OF THE BOARD OF DIRECTORS
Art. 14 Functions
(1)The Chairman - or in his/her absence one of the Vice Chairmen - presides over
the meetings of the Board of Directors and the General Meeting of Shareholders.
(2)The Chairman of the Board of Directors, together with the full-time Vice
Chairman, exercises ongoing supervision over the Group Executive Board on behalf
of the Board of Directors. The Chairman and the full-time Vice Chairman are
responsible for providing information to the Chairman's Office and the Board of
Directors that is relevant to their function.
(3)Group Internal Audit directly reports to the Chairman of the Board of
Directors.
Art. 15 Authorities
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The Chairman of the Board of Directors and the full-time Vice Chairman may
demand information about any matters relating to the Group, and examine reports,
proposals and minutes of meetings of the Group Executive Board, the Functional
Areas of the Corporate Center, the Business Groups and the Divisions.
V. THE GROUP EXECUTIVE BOARD
Art. 16 Composition
The Group Executive Board consists of its President (Group Chief Executive
Officer), the Chief Financial Officer and at least three other members with
important Group functions.
Art. 17 Meetings, decisions, minutes
(1)As a rule, the Group Executive Board meets at least once every month.
Extraordinary meetings will be held as required or at the request of a member.
(2)A quorum is constituted when at least three members of the Group Executive
Board are present, or can be reached for discussion and voting. For voting on
matters of fundamental importance, however, two thirds of the members, including
the member responsible for the area concerned, must attend.
(3)Decisions are taken by the absolute majority of the members present. In case
of a tie the presiding officer has the casting vote.
(4)Minutes are kept of decisions taken by the Group Executive Board and are
signed by the presiding officer and the recording secretary. They are taken as
approved if no comment is made on them in the next meeting. They shall be sent
to the members of the Chairman's Office and the Group Executive Board.
Art. 18 Functions and authorities
(1)The Group Executive Board is the Group's supreme executive body within the
meaning of the Swiss Banking Law. It ensures cooperation and unity within the
Group across Business Group lines and is responsible for the Group's
performance.
(2)The authorities of the Group Executive Board are governed in detail in the
"Appendix", based on article 30 of the Articles of Association. The Group
Executive Board prepares the proposals which have to be submitted to the
Chairman's Office and the Board of Directors for approval and supports them in
their decision making process. It regularly informs the Board of Directors on
the Group's business development.
(3)The Group Executive Board may wholly or partially delegate approval
authorities to one of its members.
Art. 19 The Group Executive Board as Risk Council
The Group Executive Board assumes the responsibilities of a Risk Council. It is
responsible for implementing the Risk Management and Control Principles, for
approving the core risk policies as proposed by the Group Chief Risk Officer
and/or the Group Chief Credit Officer, for allocating risk limits to the
Business Groups within the overall approved framework and for managing the risk
profile of the Bank as a whole.
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Art. 20 The President
(1)The President is responsible for the overall executive management of the
Group; he heads the Group Executive Board and presides over its meetings.
(2)He ensures that matters relating to the Group are dealt with, supervises the
management of the Business Groups and ensures that the Business Groups work
together. He is responsible for ensuring that decisions are taken in a timely
fashion and for supervising their implementation.
(3)He is responsible for Human Resources, Management Development and Corporate
Communications and - in consultation with the Chairman of the Board of Directors
- for the image of the Group as a whole.
(4)He ensures that the Chairman's Office and the Board of Directors are informed
in a timely and appropriate manner.
(5)The President has an all-encompassing right to information and examination
regarding all matters handled by the Corporate Center and by the Business
Groups. He has veto power over any decisions taken by any management body. A
veto has the effect of suspending the decision until the matter is decided by
the Group Executive Board.
Art. 21 The Chief Financial Officer
The Group Chief Financial Officer is responsible for the Group's financial
management, for the implementation of group-wide independent risk control and
for group-wide controlling processes. The Group Chief Risk Officer and the Group
Chief Credit Officer have group-wide responsibility for the Risk functions. The
Group Controller has group-wide responsibility for financial control functions.
Art. 22 Special committees
Matters of common interest to the Group are dealt with in special committees
presided over by the President, the CFO or another member of Senior Management
appointed to this function by the Group Executive Board.
VI. THE BUSINESS GROUPS
Art. 23 Organization of business activities
(1)The Group's business activities are organized into Business Groups, which in
turn are broken down into Divisions and/or Business Areas.
(2)The structure and assignment of activities are reflected in the basic
organizational structure of the Group. Details about responsibilities, functions
and authorities are governed in the "Appendix" to these Organization Regulations
and in the Business Group Regulations.
Art. 24 The CEO of the Business Group
(1)The CEO of the Business Group is responsible for the implementation of the
business strategy within his Business Group and for the implementation of the
decisions taken by the Board of Directors, the Chairman's Office and the Group
Executive Board.
(2)He has overall responsibility for the Business Group and its management and
is accountable for its results.
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Art. 25 Responsibilities
(1)The Business Groups are responsible for the management of the business, of
resources, logistics and all risks within their respective area of
responsibility. At shared locations the Group Executive Board assigns all or
part of logistics and resources responsibilities to the most suitable Business
Group.
(2)Management structure, responsibilities and accountability in the areas of
risk management, reporting, communication, internal and external information,
human resources, legal and compliance issues are governed in the Business Group
Regulations, based strictly on the principles established by the Group.
VII. THE CORPORATE CENTER
Art. 26 Functions and organization
(1)The Corporate Center works with the Business Groups to ensure long-term
maximization of shareholder value.
(2)It assumes responsibility in the financial management of the Group, in
maintaining an appropriate balance between risk and returns, in managing
effective communication with all stakeholders, in positioning the Group as
employer of choice and in coordinating activities critical for the Group's
reputation.
Art. 27 Functional directive and controlling authority
The heads of the Functional Areas of the Corporate Center have functional
directive and functional controlling authority throughout the Group.
VIII. REGION AND COUNTRY HEADS REPRESENTATIVES AND PERMANENT ADVISORS
Art. 28 Appointment
Upon recommendation of the Business Groups, the Group Executive Board appoints
Region and Country Heads, Representatives who assume functions for more than one
Business Group, as well as the permanent advisors of the Group.
IX. GROUP INTERNAL AUDIT
Art. 29 Organization
(1)Group Internal Audit performs the Group's internal audits.
(2)The guidelines for the activities of Group Internal Audit are contained in a
special set of regulations.
(3)The Chairman's Office may order special audits to be conducted. Individual
members of the Board of Directors may submit requests for such audits to the
Chairman's Office. If there is any doubt about whether such a request is
justified, the question is submitted to the Board of Directors by the presiding
director.
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(4)The members of the Group Executive Board, with the agreement of the Chairman
of the Board of Directors, may instruct Group Internal Audit to conduct special
audits.
Art. 30 Functions and authorities
(1)Group Internal Audit monitors compliance with the legal and regulatory
requirements and with the provisions of the Articles of Association, as well as
with internal directives and guidelines within the organizational units of the
parent company and the group companies. In doing so, it specifically verifies or
assesses whether the internal controls are commensurate with the risks and are
working effectively, whether activities within the Group are being conducted and
recorded properly, correctly and fully, and whether the organization of
operations, including information technology, is efficient and the information
is reliable.
(2)Group Internal Audit possesses unrestricted auditing rights within the parent
company and the group companies; it has access at all times to all accounts,
books and records. It must be provided with all information and data needed to
fulfill its auditing duties.
Art. 31 Reports
(1)Group Internal Audit is independent in its reporting and is not subject to
any instructions.
(2)Group Internal Audit addresses its reports with major issues ultimately to
the Chairman of the Board of Directors. The procedure employed for this and the
list of other recipients of its audit reports are described in the regulations
governing Group Internal Audit.
(3)Audit issues of less significant importance are brought to the attention of
the appropriate level of management.
(4)The Chairman of the Board of Directors and the President shall inform the
Chairman's Office and the Board of Directors in an appropriate manner of any
findings of Group Internal Audit which raise questions of fundamental importance
or reveal serious weaknesses.
(5)The Chairman of the Board of Directors shall also inform the Board of
Directors of the results of special audits performed at the request of
individual board members.
(6)The members of the Board of Directors and of the Group Executive Board shall
receive the annual activity report of the Head of Group Internal Audit for
review. This report is to be discussed at a meeting of the Board of Directors.
X. SIGNATURES
Art. 32 Authority to sign for the parent company
(1)The following persons are authorized to sign, jointly with another authorized
signatory:
a) The members of the Chairman's Office
b) The members of the Group Executive Board
c) The members of the Group Managing Board
d) Managing Directors, Executive Directors and Directors (Senior Management)
e) Associate Directors, in Division Private and Corporate Clients
Chefprokuristen, Prokuristen and Handlungsbevollmachtigte.
(2)The authority to sign encompasses:
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a) all branches of UBS AG worldwide for the members of the Chairman's
Office, the Group Executive Board and the Group Managing Board
b) the respective Business Area and jurisdiction for all other signatories.
(3)The Group Executive Board may extend the authority to sign for individual
signatories beyond their respective jurisdiction. The Business Groups may extend
the authority to sign for individual signatories beyond their respective
Business Area.
(4)Members of Senior Management may, in individual cases, authorize an internal
or external person to bind the parent company with legal effect by his or her
sole signature for acts which can only be performed outside the business
premises, such as the signing of contracts. The authorization is only possible
for matters on which decisions have been made by the competent body of the
parent company.
(5)The Group Executive Board may rule that forms and other written documents
produced in large quantities in the course of daily business may be distributed
with only one or without signature. Such exceptions to the joint signature
principle shall be made known in a suitable fashion giving details of the
relevant maximum authorized amounts.
Art. 33 Form of signature
All authorized signatories sign by adding their signature to the Corporation's
name.
XI. GENERAL PROVISIONS
Art. 34 Abstention
In the decision making process, members of the Board of Directors, the Group
Executive Board, the Business Group Boards and executive managements are obliged
to abstain from discussions and decisions on transactions or other matters
involving a potential conflict of interest. Rules for abstention in individual
transactions will be established by the Business Groups.
XII. AMENDMENTS
Art. 35 Amendments
The members of the Board of Directors must be notified in writing of any
proposals for the amendment of the Organization Regulations at least one week
before the proposals are to be discussed.
XIII. ENTRY INTO FORCE, IMPLEMENTING PROVISIONS
Art. 36 Entry into force, implementing provisions
(1)These Organization Regulations entered into force on 14 September 2000.
(2)The Group Executive Board shall enact rules for the implementation of these
regulations if deemed necessary.
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UBS AG
Alex Krauer Alberto Togni
Chairman of the Vice Chairman of the
Board of Directors Board of Directors
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APPENDIX TO THE ORGANIZATION REGULATIONS
AUTHORITIES
This "Appendix" is an integrated part of the Organization Regulations.
It has been approved by the Board of Directors of UBS AG on September 14, 2000
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TABLE OF CONTENTS
1. Organization
2. Strategy
3. Planning and Reporting
4. Capitalization and Funding
5. Risk Management and Control
6. Personnel and Compensation
7. Participations / Investments
8. Group Companies
9. Auditing
10. Other Matters
ABBREVIATIONS
A Approval
AD Associate Director
AGM Annual General Meeting of Shareholders
AoA Articles of Association
BoD Board of Directors
CRE Corporate Real Estate
D Director
ED Executive Director
GCCO Group Chief Credit Officer
GCFO Group Chief Financial Officer
GCRO Group Chief Risk Officer
GEB Group Executive Board
GC Group Companies
GMB Group Managing Board
I Information
MD Managing Director
OR Organization Regulations
P Proposal
PCE Potential Credit Exposure
VaR Value at Risk
X Authority
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1. ORGANIZATION
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1.1. LEGAL STRUCTURE
1.1.1. Articles of Association A* *) to be submitted
to the AGM for approval
1.1.2. Organization Regulations
and Appendix delineating
authorities A P
1.1.3. Business Group
Regulations and
Regulations of Corporate
Center A P P P
1.1.4. Business Regulations of
Divisions and Business
Units / Business Areas A P P
1.2. ORGANIZATIONAL STRUCTURE
1.2.1. Election of the
Chairman's Office and of
the Secretary to the Board
of Directors X
1.2.2. Election of the Chairman
and the members of the
Audit Committee A P
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1.2.3. Basic organizational Definition of
structure of the Group A P basic structure
(Business Groups)
1.2.4. Organizational structure
of the Business Groups and
the Corporate Center A P P
1.2.5. Special Committees for
Group purposes
Definition of mission and
appointment of members A P P
1.2.6. Other structures A A
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2. STRATEGY
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2.1. GROUP STRATEGY A P
2.2. BUSINESS GROUP AND
CORPORATE CENTER STRATEGIES A P P
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3. PLANNING AND REPORTING
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3.1. PLANNING
3.1.1. Mid-term financial and
business planning,
definition of targets and
Terms of Reference I A P: CFO P
3.1.2. Annual budget of the Group A P
3.2. REPORTING
3.2.1. Consolidated and parent
company annual financial
statements A P
3.2.2. Annual Report
Concept, general guidelines A P
Editing A P:CFO
Sign-off A P
3.2.3. Half-year and quarterly
financial statements A P
3.2.4. Half-year and quarterly
reports I A P: CFO
3.2.5. Monthly financial
statements I A P: CFO
3.2.6. Quarterly Risk Report A P
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4. CAPITALIZATION AND FUNDING
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4.1. SHARE CAPITAL AND UBS
SHARES
4.1.1. Increase, decrease of
share capital, creation of *) to be submitted
conditional and authorized to the AGM for approval
capital A* P (amendment of AoA)
4.1.2. Use of authorized and
conditional capital
(through rights issues,
employee share schemes etc.) A P
4.1.3. Listing and delisting of
UBS shares A P
4.2. TREASURY SHARES
4.2.1. Treasury stock policy A P
4.2.2. Sale, purchase of own
shares as treasury stock
(incl. derivatives) I CEO and CFO
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4.3. REGULATORY CAPITAL
4.3.1. Issue of tier 1 capital
(other than common stock
and Bearer Participation
Certificates) issued by the
parent company A P: CFO
4.3.2. Repurchase and redemption
of tier 1 capital (other
than common stock and
Bearer Participation
Certificates) issued by the
parent company) CFO
4.3.3. Issue, repurchase and
redemption of tier 2 and 3
capital CFO
4.4. ALLOCATION OF CAPITAL
4.4.1. Capital determination and
allocation method CFO
4.4.2. Allocation to Business
Groups A P: CFO
4.4.3. Allocation within
Business Groups I: CFO A Proposal by
Business Groups /
Divisions
4.5. INTERNAL LEGAL LENDING
LIMIT
4.5.1. Setting of legal lending
limit (Group and parent
bank) A P: CFO/CCO
4.5.2. Setting of available
excess capital (Group) A P: CFO/CCO
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4.5.3. Release of available
excess capital (Group) I A P: CFO/CCO
4.6. DEBT ISSUES
4.6.1.Conditions for debt
capital market issues
(annual issue volumes,
guarantees) I A P: CFO
4.6.2. Management and
coordination of the Group's
funding activities CFO
4. 6.3. Establishment and
structural changes (e.g.
increase) of debt programs
and CD-/CP-programs
(including eventual parent
guarantee) CFO
4.6.4. Issue, repurchase, early Raising of debt through
redemption of notes, bonds the parent company or
and other securities with other Group companies.
similar characteristics(1) on In case of issues
a stand-alone basis as well through subsidiaries the
as under debt programs CFO authority also covers an
eventual parent guarantee
4.6.5. Issue of asset backed
securities through group
companies A P: CFO
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(1) Including e.g. notes and bonds with conversion rights or warrants
attached on already issued UBS shares or on securities of other companies; notes
and bonds linked (coupon and/or redemption amount variable) to the performance
of an index, a stock, a currency or the credit of a company ("CLN") etc.
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4.7. GROUP FOREIGN EXCHANGE
MANAGEMENT
4.7.1. Group foreign exchange
policy (non-trading FX
exposures) I A P: CFO
4.7.2. Setting limits A P: CFO
4.7.3. Management and reporting CFO
4.8. GROUP LIQUIDITY MANAGEMENT
4.8.1. Group liquidity policy I A P: CFO
4.8.2. Setting limits A P: CFO
4.8.3. Management and reporting CFO
4.9. GROUP INTEREST RATE
MANAGEMENT
4.9.1. Group interest rate
policy (non-trading
interest rate exposures) I A P: CFO
4.9.2. Setting limits A P: CFO
4.9.3. Management and reporting CFO
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5. RISK MANAGEMENT AND CONTROL
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5.1. RISK PHILOSOPHY AND RISK
GUIDELINES
5.1.1. Risk management and
control principles A P
5.1.2. Risk capacity A P Applies for
quantifiable risks
and is expressed
as stress loss
limits
5.2. RISK MANAGEMENT AND CONTROL
5.2.1. Implementation of risk
management and control
principles X
5.2.2. Risk measurement methods A P: CRO/CCO
5.2.3. Risk identification CRO / CCO
5.2.4. Risk reductions A P: CRO/CCO
5.2.5. Development and
concentration of risks
- monitoring CRO/CCO
- reporting I X
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All amounts in CHF millions BoD Chairman's GEB Corporate Business Remarks
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5.3. MARKET RISK MANAGEMENT AND
CONTROL
5.3.1. Definition and allocation e.g. VaR limits,
of limits to Business Groups A P: CRO Risk Factor Stress
limit
5.3.2. Allocation of specific e.g. operational
limits to Business Groups CRO P limits, stop-loss,
proprietary etc.
5.3.3. Setting Policy for
underwriting debt and
equity instruments
(including levels of
authority) I A P
5.3.4. Issuer risk policy I A P Including the setting
of standard limits per
issuer for liquid
securities and
determination of
securities exempt from
issuer risk limits.
Credit Authority for
issuer risk
concentrations
exceeding the standard
limits and/or for
illiquid securities in
accordance with section
5.4.
5.3.5. Annual turnover limits [UBS Warburg]
for banknote trading with 50 and more Guideline of Swiss
non-banks Federal Banking
Commission
5.3.6. Risk controlling process CRO
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All amounts in CHF millions BoD Chairman's GCEO or GCCO CEO UBS CEO UBS Remarks
Office GCFO or Warburg Switzerland
GEB(2)
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All authorities
5.4. CREDIT RISK MANAGEMENT are subject to
AND CONTROL (1) Credit Risk
Policies as
approved by the
GEB and/or the
GCCO and as
published on
BankWeb
5.4.1. Global ceiling for Once a Global
counterparty Ceiling is
groups approved, all
Nominal amount GEB: subsequent
> 3,500 3,500 2,500 decisions within
this ceiling are
in the GCCO's
authority. This
authority can be
delegated.
5.4.2. Corporates, brokers,
investment banks, funds,
insurance companies, public
finance and structured
transactions
5.4.2.1. Credit and
underwriting exposure
a) Take and Hold Fin.
Risk & PCE Limits
Rating C1 - C2
Rating C3 - C4 >3,500 3,500 2,500 2,000 750
Rating C5 - C6 >2,500 2,500 2,000 1,500 500
Rating C7 - C9 >1,500 1,500 1,000 500 300
Rating D0 - D1 > 750 750 400 150 150
Rating D2 - D4 > 250 250 100 75 75
> 100 100 50 25 25
</TABLE>
--------
(1) The GCCO and the Business Group CEOs may delegate their credit authority to
a deputy in their absence. Such nomination must be approved by the GEB.
Transactions approved by the GCEO or GCFO are to be reported to the GEB on a
regular basis.
(2) In the absence of the GCEO and the GCFO two GEB members may sign off
transactions on behalf of the GEB.
<PAGE> 24
14
<TABLE>
<CAPTION>
All amounts in CHF millions BoD Chairman's GCEO or GCCO CEO UBS CEO UBS Remarks
Office GCFO or Warburg Switzerland
GEB(2)
<S> <C> <C> <C> <C> <C> <C> <C>
b) Temporary Exposures The Credit Authority is
(incl. above take and expressed as nominal
hold, PCE Limits, Bridge & value; the quantum varies
Loan Underwriting with the internal credit
Commitment subject to sell rating of the
down in 6 months and counterparty, resp. the
Tradable Assets) transaction rating where
applicable. When the
Rating C1 - C2 >7,500 7,500 5,000 4,000 1,500 counterparty is part of a
Rating C3 - C4 >5,000 5,000 4,000 3,000 1,000 group, the average group
Rating C5 - C6 >3,000 3,000 2,500 1,500 500 credit rating, weighted by
Rating C7 - C9 >2,500 2,500 2,000 750 250 UBS limits for each
Rating D0 - D1 >1,500 1,500 1,000 300 100 counterparty (resp.
Rating D2 - D4 > 500 500 300 150 50 transaction) will
determine the authority
5.4.2.2. Settlement exposure level. For counterparties
(nominal amount) in emerging markets, the
worse of counterparty or
Rating C1 - C4 > 2,500 2,500 1,500 1,000 750 country rating will
Rating C5 - C6 > 2,000 2,000 1,000 750 500 determine credit
Rating C7 > 1,000 1,000 500 250 100 authority.
Rating C8 > 500 500 250 100 50
Rating C9 > 250 250 100 50 25 * One-off authority is
Rating D0 - D2 > 100 100 50 0 0 only applicable for
individual intraday and
One-off approval * na na unlimited unlimited unlimited overnight excesses. If
excess occur for a
counterparty on a regular
basis the respective limit
adjustment has to be
submitted.
</TABLE>
<PAGE> 25
15
<TABLE>
<CAPTION>
All amounts in CHF millions BoD Chairman's GCEO or GCCO CEO UBS CEO UBS Remarks
Office GCFO or Warburg Switzerland
GEB(2)
<S> <C> <C> <C> <C> <C> <C> <C>
5.4.3. Regulated Savings and
Commercial Banks
5.4.3.1. Credit and
underwriting exposure
a) Take and Hold Fin.
Risk & PCE Limits
Rating C1 - C2 > 3,500 3,500 2,500 2,000 500
Rating C3 - C4 > 2,500 2,500 2,000 1,500 250
Rating C5 - C6 > 1,500 1,500 1,000 750 100
Rating C7 - C9 > 750 750 400 200 0
Rating D0 - D1 > 250 250 100 75 0
Rating D2 - D4 > 100 100 50 25 0
b) Temporary Exposures
(incl. above take and
hold, PCE Limits, Bridge &
Loan Underwriting
Commitment subject to sell
down in 6 months and
Tradable Assets)
Rating C1 - C2 > 7,500 7,500 5,000 4,000 500
Rating C3 - C4 > 5,000 5,000 4,000 3,000 250
Rating C5 - C6 > 2,000 2,000 1,500 1,000 100
Rating C7 - C9 > 1,000 1,000 750 400 0
Rating D0 - D1 > 500 500 250 100 0
Rating D2 - D4 > 200 200 100 50 0
</TABLE>
<PAGE> 26
16
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
All amounts in CHF millions BoD Chairman's GCEO or GCCO CEO UBS CEO UBS Remarks
Office GCFO or Warburg Switzer-
GEB(2) land
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
5.4.3.2. Settlement exposure (nominal * One-off authority is
amount) only applicable for
Rating C1 - C4 individual intraday and
Rating C5 - C6 >7,000 7,000 5,000 4,000 1,000 overnight excesses. If
Rating C7 >4,500 4,500 3,000 2,500 750 excess occur for a
Rating C8 >1,500 1,500 1,000 750 200 counterparty on a
Rating C9 > 750 750 500 250 50 regular basis the
Rating D0 - D2 > 400 400 250 50 0 respective limit
> 100 100 25 10 0 adjustment has to be
submitted.
One-off approval * na na unlimited unlimited unlimited
------------------------------------------------------------------------------------------------------------------------------------
5.4.4. Private Individuals and *Non-marketable
privately owned Investment eligible collateral
Companies includes single-stock,
Standby Letter of
5.4.4.1. Lending and margin limits Credit, covered
- unsecured > 50 50 20 15 15 guarantees and
- against marketable repurchase value of
eligible collateral > 500 500 400 300 300 life insurance policies
- against non-marketable
eligible collateral* > 250 250 200 150 150
5.4.4.2. Lending against
- owner occupied
residential Real Estate > 50 50 25 15 15
- other Real Estate > 250 250 200 150 150
------------------------------------------------------------------------------------------------------------------------------------
5.4.5. Principal Finance (Nominal Authorities subject to
Amounts) Principal Finance
- Individual, single asset >1,000 1,000 500 250 0 Credit Risk Policy and
- Pooled assets >3,000 3,000 1,500 750 0 to market risk approval
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 27
17
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
All amounts in CHF millions BoD Chairman's GCEO or GCCO CEO UBS CEO UBS Remarks
Office GCFO or Warburg Switzer-
GEB(2) land
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
5.4.6. Impaired Assets(Recovery
portfolio) The Chairman's Office
has to be informed
5.4.6.1. Valuation/provisioning about important new
- Cumulative provision for > 50 50 25 20 20 recovery positions
credit exposures
- Cumulative provision for > 50 50 25 20 20
Other Real Estate Owned
(OREO)
5.4.6.2. New facilities(exposure
increase)
- Additional and/or new > 50 50 25 20 20
loans
- Loan purchase > 50 50 25 20 20
5.4.6.3. Exposure extensions
- Credit renewals >7 years 7 years 5 years 3 years 3 years
- Stand-still agreements >7 years 7 years 5 years 3 years 3 years *Includes possibility
to swap from senior to
5.4.6.4. Investments subordinated and/or
Improvements in OREO > 30 30 15 10 10 from secured to
unsecured debt
5.4.6.5. Within approved and
established financial **Write-off authority
provisions/allowances only applies within
- Equity participation from existing Loan Loss
restructuring > 50 50 25 20 20 Provisions Write-Offs
- Debt forgiveness * > 50 50 25 20 20 above CHF 25 mio must
- Write-offs** >75 Info >50 Info >25 Info 25 25 be notified to the
Group CCO and beyond
depending on Info-
Requirement
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 28
18
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
All amounts in CHF millions BoD Chairman's GCEO or GCCO CEO UBS CEO UBS Remarks
Office GCFO or Warburg Switzer-
GEB(2) land
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
5.4.7. Country risk
Nominal exposures
S0 - S2 No limits No limits No limits
S3 - S4 >3,000 3,000 1,000
S5 - S7 >2,000 2,000 750
S8 - S14 >1,000 1,000 500 not to be delegated
Definition of countries with A P
no limits (below S2)
------------------------------------------------------------------------------------------------------------------------------------
5.5. CONSEQUENTIAL RISK MANAGEMENT Definition according to
AND CONTROL the guidelines to the
risk management and
control principles
------------------------------------------------------------------------------------------------------------------------------------
5.5.1. Risk Controlling Process CRO
------------------------------------------------------------------------------------------------------------------------------------
5.5.2. Corporate Security CRO
------------------------------------------------------------------------------------------------------------------------------------
5.5.3. Insurance coverage CRO
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 29
19
6. PERSONNEL AND COMPENSATION
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
6.1. APPOINTMENTS, REMOVALS AND
TITLE RATIFICATION
------------------------------------------------------------------------------------------------------------------------------------
6.1.1. Appointments and removals for
senior management functions:
6.1.1.1. Group Executive Board A P P:CEO
6.1.1.2. Group Managing Board A P
6.1.1.3. Non-GMB Members of Business
Group and Divisional Boards A P
6.1.1.4. Members of Business Area
Managements A A
------------------------------------------------------------------------------------------------------------------------------------
6.1.2. New Hire, title ratification
and removal (firing) for MD
Hiring (including assurance of
rank) and removal A A
Title ratification/promotion A P P
------------------------------------------------------------------------------------------------------------------------------------
6.1.3 New hire and removal/firing
ED, D and other management A A Can be further delegated
Title ratification/promotions A A Can be further delegated
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 30
20
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
6.1.4. Appointment and removal of
Head of Group Internal Audit A P
Appointment and promotions of
Senior Management of Group
Internal Audit A
------------------------------------------------------------------------------------------------------------------------------------
6.1.5. Appointment of region and
country heads, representatives
and permanent advisors
according to art. 28 OR A P
------------------------------------------------------------------------------------------------------------------------------------
6.2. COMPENSATION
------------------------------------------------------------------------------------------------------------------------------------
6.2.1. Compensation policy A P
------------------------------------------------------------------------------------------------------------------------------------
6.2.2. Compensation system BoD A P
------------------------------------------------------------------------------------------------------------------------------------
6.2.3. Compensation BoD members X
------------------------------------------------------------------------------------------------------------------------------------
6.2.4. Compensation system for GEB
and GMB members A P:CEO
------------------------------------------------------------------------------------------------------------------------------------
6.2.5. Compensation for GEB and GMB
members A P:CEO
------------------------------------------------------------------------------------------------------------------------------------
6.2.6. Compensation for direct
reports of GEB members A:CEO P P
------------------------------------------------------------------------------------------------------------------------------------
6.2.7. Compensation Head of Group
Internal Audit X
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 31
21
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
6.2.8. Bonus
6.2.8.1. Setting of bonus pools for
Business Groups A:CEO P:CFO P:CEO
6.2.8.2. Bonus for GEB and GMB A P:CEO
members
6.2.8.3. Bonus for other members of
Business Group and
Divisional Boards A:CEO P:CFO P:CEO
6.2.8.4. Overall bonus for MD, ED, D,
AD and employees within
approved pools
X X
------------------------------------------------------------------------------------------------------------------------------------
6.2.9. Other compensation X X May be further delegated
------------------------------------------------------------------------------------------------------------------------------------
6.3. RETIREMENT BENEFIT PLANS
------------------------------------------------------------------------------------------------------------------------------------
6.3.1. Setting Group retirement
benefit plans A P
------------------------------------------------------------------------------------------------------------------------------------
6.3.2. Appointment of the Board
members (employer's
representatives) of the
pension trusts A P
------------------------------------------------------------------------------------------------------------------------------------
6.3.3. Approval of principles
governing retirement benefit
plans A P
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 32
22
7. PARTICIPATIONS/INVESTMENTS
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
All amounts in CHF millions BoD Chairman's GEB Corporate Business Business Remarks
Office Center Groups Areas
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
7.1. EQUITY PARTICIPATIONS/
FINANCIAL INVESTMENTS
------------------------------------------------------------------------------------------------------------------------------------
7.1.1. Policy for equity
participations/financial
investments I A P: CFO
------------------------------------------------------------------------------------------------------------------------------------
7.1.2. Purchase, sale, increase, *only for real estate
decrease of equity companies for bank
participations/financial purposes after project
investments as well as use of approval through
subscription rights >500 500 CFO:50 10* Corporate Center(CRE)
------------------------------------------------------------------------------------------------------------------------------------
7.2. PRIVATE EQUITY(1)
------------------------------------------------------------------------------------------------------------------------------------
7.2.1. Overall limit A P
------------------------------------------------------------------------------------------------------------------------------------
7.2.2. Taking positions CEO UBSW CEO UBS
Capital *Information of GEB
7.2.2.1. Underwriting >500 500 400 300 required in cases which
are likely to provoke
7.2.2.2. Final hold position >400 400 300 200* publicity
------------------------------------------------------------------------------------------------------------------------------------
7.2.3. Sales I I:UBSW X
------------------------------------------------------------------------------------------------------------------------------------
7.2.4. Write-offs
(specific to individual
investments) >50 50 25 20
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
--------
(1) In urgent cases, where GEB approval is required, the CEO of UBS Capital
together with the Group CEO or CFO and the CEO of UBS Warburg may act on behalf
of the GEB. The GEB is to be informed at its next meeting.
<PAGE> 33
23
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
All amounts in CHF millions BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
7.3. REAL ESTATE
------------------------------------------------------------------------------------------------------------------------------------
7.3.1. Annual investment budget A P
------------------------------------------------------------------------------------------------------------------------------------
7.3.2. Bank properties (CFO)
7.3.2.1. Release of projects included
in budget
- Purchase, sale,
construction of new and
alterations to existing
buildings >50 50 10
- Liabilities arising from >100 100 10* *) Corporate Center(CRE) to be
lease and building rights >5 p.a. 5 p.a. 1.25 p.a. informed
contracts
7.3.2.2. Valuation/provisioning >50 50 25
7.3.2.3. Divergence to project release >10% 10% 5% CEO:5%** **) of approved annual budget
7.3.2.4. Projects not included in the
budget Financial release
(adding to the Group
budget)*** >10% 10% CFO:5% CEO:5%** ***) Each project has to be
released with the same approval as
for projects included in budget
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 34
24
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
All amounts in CHF millions BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
7.3.3. Other properties
7.3.3.1. Release of projects included
in budget
Purchase, sale, construction
of new and alterations to
existing buildings >50 50
7.3.3.2. Projects not included in *) Project release: same approval
budget
Financial release (adding as for projects included in budget
to the Group budget)* >10% 10% 5%
------------------------------------------------------------------------------------------------------------------------------------
7.3.4. Pledged properties PCC
Setting purchase and sale
limits for pledged properties >100 100 CFO:50 25
------------------------------------------------------------------------------------------------------------------------------------
7.4. IT HARDWARE AND SOFTWARE
------------------------------------------------------------------------------------------------------------------------------------
7.4.1. Annual investment budget A P
------------------------------------------------------------------------------------------------------------------------------------
7.4.2. Purchase and sale of IT and
telecommunications equipment
and software Reporting required to the Head of
not included in the budget >10% 10% CFO:5% CEO:5% the IT Committee
------------------------------------------------------------------------------------------------------------------------------------
7.4.3. Liabilities relating to
external IT and
telecommunications assignments Reporting required to the Head of
not included in the budget >10% 10% 5% CEO:5% the IT Committee
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 35
25
8. GROUP COMPANIES(GCS)
(GCs are consolidated companies which are either wholly or majority, directly or
indirectly owned or otherwise controlled by UBS AG)
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
All amounts in CHF millions BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
8.1. STRATEGY AND GOVERNANCE
------------------------------------------------------------------------------------------------------------------------------------
8.1.1. Purchase, increase, decrease
and sale of majority
shareholdings in financial
services firms; purchase and
sale of businesses >500 500 250 CFO:25
------------------------------------------------------------------------------------------------------------------------------------
8.1.2. Formation of operative or
non-operative GCs with equity
of >500 500 CFO:100
------------------------------------------------------------------------------------------------------------------------------------
8.1.3. Establishment and closure of
- branches and representative
offices
- of the parent company
outside Switzerland A P P
- of GCs A:CFO P
- branches in Switzerland X:PCC
------------------------------------------------------------------------------------------------------------------------------------
8.1.4. Change of external auditors
for
- GCs in Switzerland A P
- branches and GCs
outside Switzerland A P
------------------------------------------------------------------------------------------------------------------------------------
8.1.5. Election of Boards and Details are governed by
appointment of management of "Regulations governing the
GCs A A management of the group companies"
------------------------------------------------------------------------------------------------------------------------------------
8.1.6. Allocation of market and
credit risk limits CRO/CCO
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 36
26
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------------
All amounts in CHF millions BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
8.2. FUNDING AND FINANCIAL MANAGEMENT
OF GCS
------------------------------------------------------------------------------------------------------------------------------------
8.2.1. Capital increase, individual
or cumulative p.a. per company >500 500 CFO:100
------------------------------------------------------------------------------------------------------------------------------------
8.2.2. Capital reduction and
redemption, merger or
liquidation of operative or
non-operative GCs >500 500 CFO:100
------------------------------------------------------------------------------------------------------------------------------------
8.2.3. Equity-like lendings to GCs >500 500 CFO:100
------------------------------------------------------------------------------------------------------------------------------------
8.2.4. Credit limits for internal
engagements >2,500 CFO:2,500
-----------------------------------------------------------------------------------------------------------------------------------
8.2.5. Parent guarantees on behalf of
GCs >2,500 CFO:2,500
------------------------------------------------------------------------------------------------------------------------------------
8.2.6. Approval of annual financial
statements including
distribution of profit CFO
------------------------------------------------------------------------------------------------------------------------------------
8.3. SPECIAL PURPOSE ENTITIES (SPEs)
------------------------------------------------------------------------------------------------------------------------------------
8.3.1. Setting rules governing the
use of SPEs A P:CFO
------------------------------------------------------------------------------------------------------------------------------------
8.3.2. Functional management and
monitoring of SPEs X X
------------------------------------------------------------------------------------------------------------------------------------
8.3.3. Formation, purchase, sale, Legal Structure Committee sign-off
liquidation or merger of required
non-consolidating SPEs X
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 37
27
9. AUDITING
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
9.1. EXTERNAL AUDIT
-----------------------------------------------------------------------------------------------------------------------------
9.1.1. Appointment of Group and *) Proposal to be
Statutory auditors A* P submitted to the
AGM for approval.
Preparation of the
nomination
supported by GEB,
Audit Committee
and Group Internal
Audit
-----------------------------------------------------------------------------------------------------------------------------
9.1.2. Approval of Group and Preparation for
Statutory Reports on A P submission to AGM
financial statements
-----------------------------------------------------------------------------------------------------------------------------
9.2. INTERNAL AUDIT
-----------------------------------------------------------------------------------------------------------------------------
9.2.1. Appointment of the Head
of Group Internal Audit A P
(GIA)
-----------------------------------------------------------------------------------------------------------------------------
9.2.2. Determination of GIA X I
activities
-----------------------------------------------------------------------------------------------------------------------------
9.2.3. GIA activity report A P I
-----------------------------------------------------------------------------------------------------------------------------
9.2.4. Individual internal audit X X X X Circulation among
reports units/persons
involved/concerned
-----------------------------------------------------------------------------------------------------------------------------
9.3. AUDIT COMMITTEE
-----------------------------------------------------------------------------------------------------------------------------
9.3.1. Regulations on Audit A P
Committee
-----------------------------------------------------------------------------------------------------------------------------
9.3.2. Appointment of members
and Chairman of Audit A Chairman
Committee BoD: P
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 38
28
10. OTHER MATTERS
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
All amounts in CHF millions BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
10.1. LITIGATION / SETTLEMENTS
-----------------------------------------------------------------------------------------------------------------------------
10.1.1. Notification about Information of
litigations initiated other Bodies
against the Group and >25 25 10 (e.g. BoD)
claims lodged required,
irrespective of
amounts claimed,
in cases with high
reputational risk
-----------------------------------------------------------------------------------------------------------------------------
10. 1.2. Authorization to
initiate litigations and >100 100 50 CEO or 20
to conclude settlements CFO: 20
-----------------------------------------------------------------------------------------------------------------------------
* Political
10.2. EXTERNAL MANDATES* mandates and
mandates on a
private basis do
not require
approval, but
notification
(Group regulation
CF/-/006)
-----------------------------------------------------------------------------------------------------------------------------
10.2.1. of members of the
Chairman's Office A
10.2.2. of members of the BoD I
10.2.3. of members of the GEB A
10.2.4. of members of the GMB A
10.2.5. of other staff A: CEO/CFO A
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 39
29
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
All amounts in CHF millions BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
10.3. EQUIPMENT AND MATERIAL
-----------------------------------------------------------------------------------------------------------------------------
10.3.1. Annual budget for the
purchase and sale of other
equipment, fittings and A P
movables
-----------------------------------------------------------------------------------------------------------------------------
10.3.2. Purchase and sale of
other equipment, fittings Percentage of
and movables not included >10% 10% CEO or 5% approved budget
in the budget CFO: 5%
-----------------------------------------------------------------------------------------------------------------------------
10.4. INITIATION OF BANK PROJECTS
-----------------------------------------------------------------------------------------------------------------------------
10.4.1. Initiation of bank
projects with projected
aggregate costs
(investment, internal and
external expenses,
including operating >100 100 CFO: 50 50
expenses for the first
year of operation)
amounting to
-----------------------------------------------------------------------------------------------------------------------------
10.5. INDIVIDUAL MANDATES TO
EXTERNAL CONSULTING FIRMS >2 2 2
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 40
30
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
BoD Chairman's GEB Corporate Business Remarks
Office Center Groups
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
10.6. PURCHASE AND SALE OF
BROKER LICENSES A
-----------------------------------------------------------------------------------------------------------------------------
10.7. WARRANT ISSUES ON UBS
SHARES CEO UBSW
-----------------------------------------------------------------------------------------------------------------------------
</TABLE>
UBS AG
Alex Krauer Alberto Togni
Chairman of the Board of Directors Vice Chairman of the Board of Directors
