The UBS E-TRACS currently available are issued by UBS AG and listed on the NYSE Arca exchange. They may be purchased in a similar way to other publicly traded securities and can be bought or sold at any time during market hours.

How to invest in E-TRACS

• E-TRACS can be purchased through a broker on a U.S. securities exchange during market hours.

How to sell E-TRACS ETNs

• E-TRACS ETNs can be sold through a broker in the secondary market on a U.S. securities exchange during market hours.

Redemption info

How to Redeem E-TRACS ETNs

• Holders of E-TRACS generally may elect to require UBS to redeem their E-TRACS on any trading day during the term, subject to minimum size and certain other limitations and procedures specified in the relevant E-TRACS prospectus supplement.
• UBS may have a contingent right to call some E-TRACS prior to maturity where less than a specified principal amount continues to be traded. The existence of, and conditions for exercise of this right by UBS, will be specified in the applicable prospectus supplement.
• At maturity, or upon early redemption, the E-TRACS will be redeemed by UBS for a cash payment based on the performance of the underlying index, less an investor fee, amount (as specified in the relevant E-TRACS prospectus supplement for each offering of E-TRACS), determined on the final or applicable valuation date.
• Any cash amount that a holder may receive at maturity and upon early redemption will be determined by the performance of the underlying index (net of the investor fee amount payable by the holder).
• The E-TRACS do not pay interest and do not guarantee that investor's will receive at least their principal investment at maturity. Investors may lose up to 100% of their original principal amount invested.

Investors should consult their broker or financial advisor for more information.

E-TRACS Treatment for US Federal Income Tax Purposes

This discussion applies to you only if you hold your E-TRACS as capital assets for tax purposes. This section does not apply to you if you are a member of a class of holders subject to special rules or a Non-United States holder.

There is no authority that directly addresses the tax treatment of your E-TRACS and thus the tax treatment of your E-TRACS is uncertain. However the E-TRACS are intended to be treated as a pre-paid forward contract with respect to the Index and the terms of the E-TRACS require you and us (in the absence of a statutory, regulatory, administrative or judicial ruling to the contrary) to treat the E-TRACS for all tax purposes in accordance with such characterization. If the E-TRACS are so treated, you should recognize capital gain or loss upon the sale, redemption or maturity of your E-TRACS in an amount equal to the difference between the amount you receive at such time and your tax basis in the E-TRACS. In general, your tax basis in your E-TRACS will be equal to the price you paid for it. Capital gain of a non-corporate United States holder is generally taxed at preferential rates where the property is held for more than one year. The deductibility of capital losses is subject to limitations. Your holding period for your E-TRACS will generally begin on the date after the issue date (i.e., the Settlement Date) for your E-TRACS and, if you hold your E-TRACS until maturity, your holding period will generally include the maturity date.

The Internal Revenue Service has recently released a notice that may affect the taxation of holders of the E-TRACS. According to the notice, the Internal Revenue Service and the Treasury Department are actively considering whether the holder of an instrument such as the E-TRACS should be required to accrue ordinary income on a current basis, and they are seeking taxpayer comments on the subject. It is not possible to determine what guidance they will ultimately issue, if any. It is possible, however, that under such guidance, holders of the E-TRACS will ultimately be required to accrue income currently and this could be applied on a retroactive basis. The Internal Revenue Service and the Treasury Department are also considering other relevant issues, including whether additional gain or loss from such instruments should be treated as ordinary or capital, whether foreign holders of such instruments should be subject to withholding tax on any deemed income accruals, and whether the special "constructive ownership rules" of Section 1260 of the Internal Revenue Code might be applied to such instruments. Holders are urged to consult their tax advisors concerning the significance, and the potential impact of the above considerations. Except to the extent otherwise required by law, UBS intends to treat your E-TRACS for United States federal income tax purposes in accordance with the treatment described above unless and until such time as the Treasury Department and Internal Revenue Service determine that some other treatment is more appropriate.

In addition, a member of the House of Representatives has recently introduced a bill that, if enacted, would require holders of the E-TRACS purchased after the bill is enacted to accrue interest income over the term of the E-TRACS despite the fact that there will be no interest payments over the term of the E-TRACS. It is not possible to predict whether this bill or a similar bill will be enacted in the future and whether any such bill would affect the tax treatment of your E-TRACS.

In addition, it is possible that (i) the E-TRACS could be treated as a debt instrument subject to the special tax rules governing contingent debt instruments, (ii) the E-TRACS could be treated as a series of forward contracts each of which mature on the next rebalancing date and/or roll date or (iii) Section 1256 of the Internal Revenue Code could apply to your E-TRACS.

Because of the absence of authority regarding the appropriate tax characterization of your E-TRACS, it is possible that the IRS could seek to characterize your E-TRACS in a manner that results in tax consequences to you that are different from those described above. For example, the IRS could possibly assert that (i) you should be treated as if you owned the underlying components of the underlying Index, (ii) you should be required to accrue interest income over the term of your E-TRACS, (iii) any gain or loss that you recognize upon the exchange or maturity of your E-TRACS should be treated as ordinary gain or loss or (iv) you should be required to include in ordinary income an amount equal to any increase in the underlying index that is attributable to ordinary income that is realized in respect of the component of the underlying index, such as interest, dividends or net-rental income. You should consult your tax adviser as to the tax consequences of such characterizations and any possible alternative characterizations of your E-TRACS for U.S. federal income tax purposes.

Investors should note that the intended tax treatment discussed above may not apply to all E-TRACS, and that the expected tax treatment of particular E-TRACS will depend on the specific nature and terms of those E-TRACS. The tax summary provided in the disclosure document for particular E-TRACS will supersede, and should be read to replace, the above discussion in respect of those E-TRACS. In evaluating any potential investment in E-TRACS, investors should refer to, and carefully consider, the tax summary in the relevant disclosure document for particular E-TRACS, and should consult their own tax advisors regarding the tax consequences to them of an investment in those E-TRACS in light of their particular circumstances as a taxpayer and the specific characteristics and terms of those E-TRACS.

No assurance can be given that future tax legislation, regulations or other guidance may not change the tax treatment of E-TRACS. Even if the tax treatment of E-TRACS is changed for any reason only on a prospective basis, that could affect our ability to issue additional E-TRACS under an existing prospectus supplement, which could affect liquidity for E-TRACS issued prior to such change.

We do not offer tax or legal advice. An investor should consult with tax and legal advisors before investing.

	ETN	ETF	Mutual Fund
Type of Security	Debt Securities	Registered Investment Companies	Registered Investment Companies
Liquidity	Daily on exchange	Daily on exchange	Daily (close of business) at net asset value
Tax	Tax reporting intended in year of sale, maturity or repurchase by the issuer	Yearly 1099 tax reporting	Yearly 1099 tax reporting
Registration	Securities Act of 1933	Investment Company Act of 1940	Investment Company Act of 1940
Investor ownership	Senior, unsecured debt of the ETN issuer	Equity stake in a portfolio of securities	Equity stake in a portfolio of securities
Principal Risk	Market and issuer risk	Market risk	Market risk
Short Sales	Yes, subject to lending availability	Yes, subject to lending availability	Not available
Voting Rights	None	Yes	Yes

Benefits

Access to New Markets and Strategies
Certain asset classes and strategies are not easily accessible to individual investors. E-TRACS provide opportunities to gain exposure to these asset classes and strategies in a convenient and cost-efficient way.

Portfolio Diversification
E-TRACS are designed to provide investors with exposure to the total returns of various market indices, including stocks, bonds, commodities, currencies in order to construct a well-rounded portfolio to meet their investment objectives.

Price Transparency
E-TRACS are designed to provide a return that is linked to the performance of an underlying index, less the investor fee amount.

The daily closing prices, daily closing indicative values and daily repurchase values of all E-TRACS and the daily closing levels of their underlying indices will be available in the product section for that particular ETN so that investors can easily track the performance of their E-TRACS products.

Tax Efficiency
E-TRACS are intended to offer a tax-efficient way to invest. Index mutual funds and exchange-traded funds (ETFs) are often required to make yearly taxable income and capital gains distributions to shareholders. In contrast, under the intended tax treatment of the E-TRACS, the timing of the realization of gains or losses on their E-TRACS is based on when investors buy and sell their investment. Under the intended treatment, investors will only realize gains or losses upon the sale, maturity or repurchase by the issuer of their E-TRACS ETNs.

For a more complete understanding of the intended tax treatment of particular E-TRACS and any related tax risks investors should read the related E-TRACS prospectus supplement regarding their expected tax treatment. We do not offer tax or legal advice. Investors are urged to consult with tax and legal advisors before investing.

Flexibility and Liquidity
Similar to equities, E-TRACS offer the liquidity provided by exchange listing. Individual investors can choose to sell E-TRACS in the secondary market at market prices during trading hours or hold them until maturity or may elect to require UBS to redeem the E-TRACS prior to maturity. Investors may elect to require UBS to redeem E-TRACS on a daily basis (as specified in the relevant E-TRACS prospectus supplement for each offering of E-TRACS). UBS will have certain requirements for early redemption. Please consult a broker or financial advisor for more information. Investors will receive a cash payment based on the performance of the index, less an investor fee amount, at maturity or earlier redemption by UBS.

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Risks

For a more comprehensive list of risk factors, please refer to the respective prospectus supplement and prospectus for the particular offering of E-TRACS in which you are considering an investment.

No Principal Protection
The E-TRACS are fully exposed to any decline in the level of the underlying index. If the value of the underlying index decreases, or does not increase by an amount greater than the aggregate investor fee applicable to E-TRACS, an investor will receive less than the investor's original investment in E-TRACS upon maturity or early redemption by UBS and could lose up to 100% of the original principal amount.

Underlying Index Risk
The return on each E-TRACS is linked to the performance of its underlying index, which, in turn, is linked to the prices of the underlying index components. These prices are determined based on a variety of market and economic factors and may change unpredictably, affecting the value of the underlying index and, consequently, the value of your E-TRACS in unforeseeable ways.

Concentrated Investment Risk
The underlying index components of some E-TRACS may be concentrated in a specific sector. The investment may therefore carry risks similar to a concentrated investment in a limited number of industries or sectors.

No Interest Payments
Investors will not receive any periodic interest payments on the E-TRACS.

Issuer Risk
E-TRACS are unsecured debt securities of UBS. The payment of the amount due on the E-TRACS upon early redemption by UBS or at maturity is dependent on UBS's ability to pay.

A Trading Market for the E-TRACS May Not Develop
Although E-TRACS are listed on a U.S. securities exchange, a trading market for E-TRACS may not develop. Affiliates of UBS and the broker-dealers distributing E-TRACS may engage in limited purchase and resale transactions. However, they are not required to do so and, if they engage in such transactions, they may stop at any time. UBS is not required to maintain any listing of E-TRACS on an exchange.

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Minimum redemption amount
E-TRACS may be sold throughout the day on the relevant exchange through any brokerage account. There are restrictions on the minimum principal balance of E-TRACS that you may redeem directly with UBS as specified in the applicable prospectus supplement or other relevant offering document.

No early redemption for limited period following issuance
You may not be permitted to elect to redeem your E-TRACS for a limited period following the initial issue date for the particular E-TRACS you purchase. Accordingly, your ability to liquidate your E-TRACS may be limited prior to this date.

Election of early redemption is irrevocable
Investors will not be able to rescind their election to redeem your E-TRACS after a redemption notice is received by UBS and will be exposed to market risk in the event market conditions change between that time that UBS receives the election and the time that the amount payable upon redemption is determined on the applicable valuation date.

UBS' contingent call right
UBS may have the right to elect to redeem all, but not less than all, of the outstanding E-TRACS relating to a particular index subject to the satisfaction of certain conditions to be specified in the applicable prospectus supplement.