Exhibit 10.39

 

LOGO [g93604ubs.jpg]         UBS Financial Services Inc.       1200 Harbor
Boulevard       Weehawken, NJ 07086       James M. Pierce       Co-Head      
Wealth Management Advisor Group US       James D. Price       Co-Head RADISYS
CORPORATION       Wealth Management Advisor Group US ATTN: BARB DOOLIN      
5445 N.E. DAWSON CREEK DRIVE       www.ubs.com HILLSBORO OR 97124-5797         
   October 8, 2008       Branch Telephone Number       +1-206-628-8511      
Account Number: WI 10802

We are pleased to offer you a way to liquidate certain of your auction rate
securities (ARS). UBS has designed a solution that gives you the option to hold
your ARS or sell the securities back to UBS. This solution is available for ARS
that were held in a UBS account on February 13, 2008, and that are not
successfully clearing at auction (Eligible ARS).

UBS is offering you “Auction Rate Securities Rights” (Rights) to sell Eligible
ARS at par value to UBS at any time during a two-year time period. These Rights
are nontransferable securities registered with the U.S. Securities and Exchange
Commission (SEC). This is a limited time offer that will expire on November 14,
2008. Accepting this offer may impact your legal rights. Not accepting this
offer may have repercussions on outstanding loans secured by Eligible ARS. As a
result, it is important that you review the prospectus carefully.

The key features and terms of the offer are summarized below. For complete
details, please see the enclosed prospectus.

 

•  

UBS is offering you nontransferable Rights to sell Eligible ARS, held in the UBS
account identified above, at par value to UBS at any time during the period of
June 30, 2010, through July 2, 2012.

 

  •  

You may instruct your UBS Financial Advisor to exercise these Rights at any time
during this time period;

 

  •  

If you do not exercise your Rights, the Eligible ARS will continue to accrue
interest or dividends as determined by the auction process;

 

  •  

If you do not exercise your Rights before July 2, 2012, they will expire and UBS
will have no further obligation to buy your Eligible ARS.

 

•  

Clients who accept this offer give UBS the discretion to purchase or sell their
Eligible ARS at any time after accepting the firm’s offer and without other
prior notice.

 

  •  

UBS will purchase tax-exempt Auction Preferred Stock (a specific type of ARS
also known as APS) at any time after clients accept the firm’s Rights offer;

 

  •  

UBS will only exercise its discretion to purchase or sell Eligible ARS for the
purpose of restructurings, dispositions or other solutions that will provide
clients with par value for their Eligible ARS;

 

  •  

In purchasing Eligible ARS or selling Eligible ARS on behalf of clients,
including tax-exempt APS, UBS will act in its capacity as broker-dealer and will
execute these transactions on a principal basis regardless of the type of client
accounts in which the Eligible ARS are held. Please see pages 27-28 in the
enclosed prospectus for more information;

 

  •  

UBS will pay clients par value for their Eligible ARS within one day of
settlement of the transaction;

 

  •  

Eligible ARS are subject to issuer redemptions at any time.

UBS AG has filed a registration statement (Including a prospectus) with the SEC
for the offering to which this communication relates. Before you make an
Investment decision, you should read the prospectus in that registration
statement and other documents that UBS has filed with the SEC for more complete
Information about UBS and this offering. You may get these documents for free by
visiting EDGAR on the SEC Web site at www.sec.gov or by calling UBS’s ARS Client
Service Center at +1-800-253-1974.

 

UBS Financial Services Inc. and UBS International Inc. are subsidiaries of UBS
AG.    1C-ARS0

--------------------------------------------------------------------------------

   UBS Financial Services Inc. LOGO [g93604ubs.jpg]   

 

•  

Clients who accept this offer release UBS and its employees/agents from all
claims except claims for consequential damages directly or indirectly relating
to its marketing and sale of ARS and expressly agree not to seek any damages or
costs (punitive damages, attorney fees, etc.) other than consequential damages.
Clients also will not serve as a class representative or receive benefits under
any class action settlement or investor fund.

 

•  

UBS will provide clients who accept the offer “no net cost” loans up to the par
value of Eligible ARS until June 30, 2010. Please see pages 36-39 in the
enclosed prospectus for more information.

 

•  

UBS will reimburse all clients who participated in prior UBS ARS loan programs
after February 13, 2008, for the difference between the cost of the loan and the
applicable interest paid on the Eligible ARS.

THIS OFFER EXPIRES ON NOVEMBER 14, 2008. Please complete, sign and date the
enclosed form and return it in the postage-paid envelope if you wish to accept
this offer. We must receive your signed acceptance form no later than
November 14, 2008.

You may receive multiple letters from us depending on the type of ARS you own or
if you have ARS in multiple accounts. Please note you must return a form for
each letter you receive to accept all available offers relating to your ARS
holdings. Please read each response form carefully as the terms may vary.

A list of your Eligible ARS in the account identified on the first page of this
letter is attached. Additional information about your Eligible ARS, including
the most recent interest rates and dividend yields, is available at www
ubs.com/auctionratesecurities.

If you have any questions about your Eligible ARS or this offer, please contact
your UBS Financial Advisor or Branch Manager at the telephone number listed at
the top of this letter. Please note that UBS Financial Advisors and Branch
Managers cannot provide legal or tax advice regarding this offer. Instructions
to exercise your Rights should be directed to your UBS Financial Advisor or
Branch Manager.

We regret any hardship that the failure of the ARS markets may have caused you.
We hope that the offer described above and discussed in detail in the prospectus
provides resolution for you regarding this matter. We look forward to continuing
our relationship with you and to serving your future investment needs.

Thank you for your business and for maintaining your relationship with UBS.

 

Sincerely,     

LOGO [g93604ex10_39pg002a.jpg]

  

LOGO [g93604ex10_39pg002b.jpg]

James M. Pierce    James D. Price

UBS Financial Servicer Inc. serves as the clearing firm for UBS International
Inc. Accordingly, the information and terms contained in this letter and the
accompanying materials are directed to clients of both UBS Financial Services
Inc and UBS International Inc.

 

UBS Financial Services Inc. and UBS International Inc. are subsidiaries of UBS
AG.    1C-ARS0

--------------------------------------------------------------------------------

Current rate and dividend information

To allow you to view the current interest rates and/or dividends your holdings
are earning, we have created an online tool available at
www.ubs.com/auctionratesecurities.

Simply enter the nine-digit CUSlP number(s) shown below to obtain the most
current information about your securities.

Percentages displayed in the descriptions below are as of September 30, 2008.

 

CUSIP

  

Description

  

CUSIP

  

Description

  

CUSIP

  

Description

00432CAR2    ACCESS GROUP INC NTS BE/R/ RATE 03.485% MATURES 09/01/37   
194262CZ2    COLLEGE LN CORP TR 1 02 TXBL ABS ARCS SR BE/R/ VARIABLE RATE RATE
05.426% MATURES 11/01/47    207784AH2    CONNECTICUT STUDENT LN F NDTN RV SER
A-2 REV /R/ VARIABLE RATE RATE 03.989% MATURES 06/01/34 452281HU5    ILLINOIS
STU ASSlST VIII 5 28DY ARC RV TXBL BE/R/ VARIABLE RATE RATE 04.248% MATURES
03/01/45    452281HV3    ILLINOIS STU ASSIST VIII 6 28DY ARC RV TXBL BE/R/
VARIABLE RATE RATE 04.201% MATURES 03/01/45    454905AZ3    INDIANA SECOND MKT
EDL SER 2004- REV STUDE /R/ VARIABLE RATE RATE 05.126% MATURES 09/01/44
455900BJ8    INDIANA SECNDRY MRKT EDU SER 1 REV TAXABLE B/E/R/ VARATE PUTBND
RATE 02.486% MATURES 12/01/47    49130NAB5    KENTUCKY HIGHER ED STUD LN INS RV
ARCS SER A2/R/ VARIABLE RATE RATE 03.323% MATURES 5/01/28    49130NBE8   
KENTUCKY HGHR ED STUD LN SER A-4 REV TXBL BE/R/ VARIABLE RATE RATE 03.920%
MATURES 06/01/35 49130NBP3    KENTUCKY HIGHER ED S/L SER A-5 RV TXBL B/E /R/
VARIABLE RATE RATE 03.970% MATURES 06/01/36    606072GF7    MISSOURI HGR EDUC LN
SER C REV TAXABLE B/E/R/ VARIABLE RATE RATE 02.525% MATURES 06/01/31   
644616AQ7    NEW HAMPSHIRE HGHR ED LN CRP ARCS AlRV TXBL BE/R/ VARIABLE RATE
RATE 00.000% MATURES 12/01/36 66704JAF5    NORTHSTAR GTEE INC DIVISION B TXBLE
/R/ VARIABLE RATE RATE 03.156% MATURES 04/01/42    709163BX6    PA ST H/E ASST
AGY REV. SER F-1 RV TAXABLE BE/R/ VARIABLE RATE RATE 04.220% MATURES 10/01/40   
709163CE7    PA ST H/E ASST AGY SR SR J-4 REV TAXABLE B/E /R/ VARATE PUTBND RATE
03.523% MATURES 12/01/40 917546GH0    UTAH ST BRD OF REGT S/L 28D TXBL 2006 DD-1
/R/ VARIABLE RATE RATE 03.911% MATURES 05/01/46    917546GJ6    UTAH ST BRD OF
REGT S/L 28D TXBL 2006 DD-2 /R/ VARIABLE RATE RATE 03.781% MATURES 05/01/46   
  

--------------------------------------------------------------------------------

LOGO [g93604ubs.jpg]

   UBS Financial Services Inc.   

Please complete and sign this form.

We must receive it by November 14, 2008.

 

Acceptance of UBS’s offer relating to auction rate securities

By signing below and returning this form, I accept UBS’s offer of Rights
relating to my Eligible ARS in the account listed below. I understand and
acknowledge the following:

 

  •  

All Eligible ARS must remain in my UBS account listed below until I exercise my
Rights to sell my Eligible ARS to UBS or they are redeemed by the issuer or
purchased or sold on my behalf by UBS;

 

  •  

I will instruct my UBS Financial Advisor or Branch Manager if and when I want to
exercise my Rights and sell my Eligible ARS to UBS during the period of June 30,
2010, through July 2, 2012;

 

  •  

The acceptance of UBS’s offer constitutes consent (to the extent legally
required) for UBS, acting as principal, to purchase my Eligible ARS or to sell
them on my behalf at any time in its sole discretion and without other prior
notice to me, from the date that I accept this offer through July 2, 2012;

 

  •  

If UBS purchases, sells or otherwise disposes of my Eligible ARS, it will
deposit the par value in my account within one business day of settlement of the
transaction;

 

  •  

I release UBS and its employees/agents from all claims except claims for
consequential damages directly or indirectly relating to its marketing and sale
of ARS and expressly agree that I will not seek any damages or costs (punitive
damages, attorney fees, etc.) other than consequential damages. I also will not
serve as a class representative or receive benefits under any class action
settlement or investor fund;

 

  •  

If the account named below is in the name of a corporation, partnership, trust
or other entity, I represent and warrant that I have the power and authority to
accept this offer on behalf of that entity.

 

    

 

Please complete and sign this form.

We must receive it by November 14, 2008.

RADISYS CORPORATION         ATTN: BARB DOOLIN         5445 N.E. DAWSON CREEK
DRIVE      Mail    UBS Financial Services Inc. HILLSBORO OR 97124-5797        
ATTN: ARS Group         1000 Harbor Boulevard         Weehawken, NJ 07086     
   Account Number: WI 10802             

Fax

 

   +1-201-442-7766

 

LOGO [g93604ex10_39pg004a.jpg]   Account owner signature  

LOGO [g93604ex10_39pg004b.jpg]

    Date  

10-21-08

 

 

Additional party signature

 

 

    Date  

 

 

 

Daytime telephone number

 

  503-615-1281

     

If you have questions, please contact your UBS Financial Advisor or Branch
Manager at +1-206-628-8511. Clients outside the U.S. may call +1-201-352-0105
collect.

We kindly request that you do not include comments or questions on this form as
it could delay processing of your instructions.

UBS AG has filed a registration statement (including a prospectus) with the SEC
for the offering to which this communication relates. Before you make an
investment decision, you should read the prospectus in that registration
statement and other documents that UBS has filed with the SEC for more complete
information about UBS and this offering. You may get these documents for free by
visiting EDGAR on the SEC Web site at www.sec.gov or by calling UBS’s ARS Client
Service Center at +1-800-253-1974.

UBS Financial Services Inc. serves as the clearing firm for UBS International
Inc. Accordingly, the information and terms contained in this letter and the
accompanying materials are directed to clients of both UBS Financial Services
Inc and UBS International Inc.

 

©2008 UBS Financial Services Inc. All rights reserved. Member SIPC.    1C-ARS0

LOGO [g93604ex10_39pg004c.jpg]

011200908|U|6960272100|01|01