AG 2008 07 21 - Laserfiche WebLink

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Investment UBS Bank Pam DuBois Deputy County Manager Cabarrus County 65 Church Street Concord, NC 28026 June 5, 2008 Dear Ms. DuBois UBS Investment Bank 1285 Avenue of the Americas New York, NY 10019 Tel. +1-212-713-2000 wowv.ubs. com/investmentbank UBS Investment Bank has made the decision to close our institutional municipal securities business through an orderly wind-down. We explored a number of alternatives to exit these operations. We determined that, because of the complexities of selling the business in the current market and limited market capacity for a business of this size, a sale was unlikely. This was a difficult decision, but ultimately closing the institutional municipal operations will help end this transition period and thus bring certainty to our clients. Please be assured that we are taking a number of steps to ensure an orderly closure of the business. Regarding existing issuer mandates in the pipeline, we will contact all clients with pending deals to determine the best method for re-assigning their transactions to another institution. We also intend to transfer our Variable Rate Demand Obligation (VRDO) business to another qualified dealer. There will be a period of time before this transition can be completed. During that transition period, we will continue to satisfy our obligations as remarketing agent: to reset the interest rates and to use best efforts to remarket tendered bonds. In addition, UBS is committed to maintaining our auction rate securities business. The Investment Bank will, therefore, assign all of our obligations as broker-dealer on auction rate certificates and auction preferred shares to our Wealth Management team, which conducted this business prior to January, 2006. For investor clientr, UBS will honor all open trades, and a transition team will be in place to ensure that your needs are being met as we close out activity. And finally, our decision to close our municipal securities business will not impact our student loan banking and structuring group. This team will remain in the Investment Bank and will continue to focus on client needs in the student loan arena. Clients with questions regarding VRDO or auction rate securities should contact our Short Term Remarketing Desk at 212-713-4692. Questions relating to interest rates swaps or derivative transactions should be directed to our Derivatives Desk at 203-719-8106. We appreciate your support during this challenging period. Sincerely, David Lawrence Cohen UBS Investment Bank's Municipal Securities Group F~g