Exhibit 10.9


 


	
  

  	
   

  	
  UBS Financial Services Inc.

  1200 Harbor Boulevard

  Weehawken, NJ 07086

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  James M. Pierce

  
	
   

  	
   

  	
  Co-Head

  
	
   

  	
   

  	
  Wealth Management Advisor
  Group US

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  James D. Price

  
	
  ACCURAY INCORPORATED

  	
   

  	
  Co-Head

  
	
  1310 CHESAPEAKE TERRACE

  	
   

  	
  Wealth Management Advisor
  Group US

  
	
  SUNNYVALE CA 94089-1100

  	
   

  	
   

  
	
   

  	
   

  	
  www.ubs.com

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  October 8, 2008

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Branch Telephone Number

  
	
   

  	
   

  	
  +1-312-525-4500

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Account Number: CP 08719

  



 


 


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-ARSO

  



 


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  UBS Financial Services Inc.

  



 


	
  ·

  	
   

  	
  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,

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  

  	
   

  	
  

  
	
  James M.
  Pierce

  	
   

  	
  James D.
  Price

  



 


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.


 

















 


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 CUSIP
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

  
	
   

  	
   

  	
   

  
	
  207784AG4

  	
   

  	
  CONNECTICUT STUDENT LN F

  NDTN A-1 REV TXBL B/E/R

  VARIABLE RATE

  RATE 03.444% MATURES
  06/01/34

  
	
   

  	
   

  	
   

  
	
  49130NAY5

  	
   

  	
  KENTUCKY HIGHER ED STUD

  LN ARC REV TAXABLE BE/R/

  VARIABLE RATE

  RATE 03.094% MATURES
  06/01/34

  
	
   

  	
   

  	
   

  
	
  709163FV6

  	
   

  	
  PA HIGH ED ASST AGY S/L

  28D TXBL ARC JJ-4 BE/R/

  VARIABLE RATE

  RATE 04.272% MATURES
  06/01/46

  
	
   

  	
   

  	
   

  
	
  452281HT8

  	
   

  	
  ILLINOIS STUDENT ASSIST

  VIII-4 28DY ARC RV BE/R/

  VARIABLE RATE

  RATE 03.997% MATURES
  03/01/45

  
	
   

  	
   

  	
   

  
	
  606072GU4

  	
   

  	
  MISSOURI HGR ED LN AUTH

  SER H REV TAXABLE BE/R/

  VARIABLE RATE

  RATE 02.898% MATURES
  07/01/32

  
	
   

  	
   

  	
   

  
	
  917546GG2

  	
   

  	
  UTAH ST BRO OF REGT STD

  LDN 2006-CC TXBLE BE/R/

  VARIABLE RATE

  RATE 04.101% MATURES
  11/01/45

  
	
   

  	
   

  	
   

  
	
  462590GF1

  	
   

  	
  IOWA STUD LN LIQ ARC (TH)

  SER 06 A 5 TAXABLE BE/R/

  VARIABLE RATE

  RATE 00.657% MATURES
  12/01/40

  
	
   

  	
   

  	
   

  
	
  644616AA2

  	
   

  	
  NEW HAMPSHIRE HGHR ED LN

  CP RV ARCS A-1 REV /R/

  VARIABLE RATE

  RATE 00.000% MATURES
  12/01/31

  



 


1C-ARSO


 

















 


©2008
UBS Financial Services Inc. All rights reserved Member SIPC.


 


www.ubs
com/financialservicesinc 


080826-2033-Let/CUSIP


 


 


UBS
Financial Services Inc. is a subsidiary of UBS AG.


1C-ARSO


 

















 


	
  

  	
  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 ray UBS
  Financial Advisor or Branch Manager if and when 1 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.

  
	
   

  	
   

  	
   

  
	
  ACCURAY
  INCORPORATED

  	
   

  	
   

  
	
  1310
  CHESAPEAKE TERRACE 

  	
   

  	
  Mail

  	
  UBS
  Financial Services Inc.

  
	
  SUNNYVALE
  CA 94089-1100

  	
   

  	
   

  	
  ATTN:
  ARS Group

  
	
   

  	
   

  	
   

  	
  1000
  Harbor Boulevard

  
	
   

  	
   

  	
   

  	
  Weehawken,
  NJ 07086

  
	
   

  	
   

  	
   

  	
   

  
	
  Account
  Number: CP 08719

  	
   

  	
  Fax

  	
  +1-201-442-7766

  



 


	
  Account
  owner signature

  	
  

  	
   

  	
  Date

  	
  11/12/8

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Additional
  party signature

  	
   

  	
   

  	
  Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Daytime
  telephone number

  	
  (408)
  716-4624

  	
   

  	
   

  	
   

  



 


If you have questions, please
contact your UBS Financial Advisor or Branch Manager at +1-312-525-4500. 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 USB International Inc.


 


©2008
UBS Financial Services Inc. All rights reserved. Member SIPC.


 


1C-ARSO


 


 


011200908|U|8092265100|01|01


 


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