The
information in this preliminary pricing supplement is not complete and may be changed. This preliminary pricing supplement is
not an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
Subject
to completion dated November 12, 2019
|
JPMorgan
Chase Financial Company LLC
|
November
2019
Pricing
Supplement
Registration
Statement Nos. 333-222672 and 333-222672-01
Dated
November , 2019
Filed
pursuant to Rule 424(b)(2)
|
Structured
Investments
Opportunities
in International Equities
Trigger Jump Securities
Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
Fully and Unconditionally
Guaranteed by JPMorgan Chase & Co.
The Trigger Jump Securities do not
pay interest and do not guarantee the return of any of the principal at maturity. At maturity, you will receive for each security
that you hold an amount in cash that will vary depending on the performance of the ETF Shares, as determined on the valuation
date. If the final share price is greater than or equal to the initial share price, you will receive for each security that you
hold at maturity a fixed cash payment equal to the upside payment in addition to the stated principal amount. If the final share
price is less than the initial share price by no more than 10%, you will receive the principal amount of your securities at maturity.
However, if the final share price is less than the initial share price by more than 10%, the payment due at maturity
will be less than the stated principal amount of the securities by an amount that is proportionate to the percentage decrease
in the final share price from the initial share price. This amount will be less than $9.00 and could be zero. Accordingly,
investors may lose their entire initial investment in the securities. Investors will not participate in any appreciation of
the ETF Shares above 21.85%. The Trigger Jump Securities are for investors who are willing to risk their principal and forgo current
income in exchange for the upside payment feature that applies to a limited range of the performance of the ETF Shares. The securities
are unsecured and unsubordinated obligations of JPMorgan Chase Financial Company LLC, which we refer to as JPMorgan Financial,
the payment on which is fully and unconditionally guaranteed by JPMorgan Chase & Co., issued as part of JPMorgan Financial’s
Medium-Term Notes, Series A, program. Any payment on the securities is subject to the credit risk of JPMorgan Financial, as
issuer of the securities, and the credit risk of JPMorgan Chase & Co., as guarantor of the securities.
|
SUMMARY
TERMS
|
|
Issuer:
|
JPMorgan Chase Financial Company LLC,
an indirect, wholly owned finance subsidiary of JPMorgan Chase & Co.
|
|
Guarantor:
|
JPMorgan Chase & Co.
|
|
ETF
Shares:
|
Shares of the iShares®
MSCI Emerging Markets ETF
|
|
Aggregate
principal amount:
|
$
|
|
Payment
at maturity:
|
§
If the final share price is greater than or equal to the initial share price, you
will receive at maturity a cash payment per $10 stated principal amount security equal to:
|
|
|
$10 + the upside
payment
|
|
|
§
If the final share price is less than the
initial share price but greater than or equal to the trigger level, you will receive
at maturity a cash payment per $10 stated principal amount security equal to:
$10
§
If the final share price is less than the trigger level, you will receive at maturity
a cash payment per $10 stated principal amount security equal to:
|
|
|
$10 ×
index performance factor
|
|
|
This amount
will be less than the stated principal amount of $10, and will represent a loss of more than 10%, and possibly all, of your
principal amount.
|
|
Upside
payment:
|
At least $2.185 per $10 stated principal
amount security (at least 21.85% of the stated principal amount). The actual upside payment will be provided in
the pricing supplement and will not be less than $2.185 per $10 stated principal amount security.
|
|
Trigger
level:
|
,
which is 90% of the initial share price
|
|
Share
percent change:
|
(final share price – initial
share price) / initial share price
|
|
Share
performance factor:
|
final share price / initial share price
|
|
Initial
share price:
|
The closing price of one ETF Share
on the pricing date
|
|
Final
share price:
|
The closing price of one ETF Share
on the valuation date
|
|
Share
adjustment factor:
|
The share adjustment
factor is referenced in determining the closing price of one ETF Share and is set initially at 1.0 on the pricing date.
The share adjustment factor is subject to adjustment in the event of certain events affecting the ETF Shares. See “The
Underlyings — Funds — Anti-Dilution Adjustments” in the accompanying product supplement.
|
|
Stated
principal amount:
|
$10 per security
|
|
Issue
price:
|
$10 per security (see “Commissions
and issue price” below)
|
|
Pricing
date:
|
November , 2019
(expected to price on or about November 29, 2019)
|
|
Original
issue date (settlement date):
|
December , 2019 (3
business days after the pricing date)
|
|
Valuation
date:
|
November 29, 2021, subject to postponement
in the event of certain market disruption events and as described under “General Terms of Notes — Postponement
of a Determination Date — Notes Linked to a Single Underlying — Notes Linked to a Single Underlying (Other Than
a Commodity Index)” in the accompanying product supplement
|
|
Maturity
date:
|
December 2, 2021, subject to postponement
in the event of certain market disruption events and as described under “General Terms of Notes — Postponement
of a Payment Date” in the accompanying product supplement
|
|
CUSIP /
ISIN:
|
48132J207 / US48132J2078
|
|
Listing:
|
The securities will not be listed on
any securities exchange.
|
|
Agent:
|
J.P. Morgan Securities LLC (“JPMS”)
|
|
Commissions
and issue price:
|
Price
to public(1)
|
Fees
and commissions
|
Proceeds
to issuer
|
|
Per security
|
$10.00
|
$0.20(2)
|
$9.75
|
|
|
|
$0.05(3)
|
|
|
Total
|
$
|
$
|
$
|
|
|
(1)
|
See
“Additional Information about the Securities — Supplemental use of proceeds
and hedging” in this document for information about the components of the price
to public of the securities.
|
|
|
(2)
|
JPMS,
acting as agent for JPMorgan Financial, will pay all of the selling commissions it receives
from us to Morgan Stanley Smith Barney LLC (“Morgan Stanley Wealth Management”).
In no event will these selling commissions exceed $0.05 per $10 stated principal amount
security. See “Plan of Distribution (Conflicts of Interest)” in the accompanying
product supplement.
|
|
|
(3)
|
Reflects
a structuring fee payable to Morgan Stanley Wealth Management by the agent or its affiliates
of $0.05 for each $10 stated principal amount security
|
If the securities priced today and
assuming an upside payment equal to the minimum listed above, the estimated value of the securities would be approximately $9.712
per $10 stated principal amount security. The estimated value of the securities on the pricing date will be provided in the pricing
supplement and will not be less than $9.60 per $10 stated principal amount security. See “Additional Information about the
Securities — The estimated value of the securities” in this document for additional information.
Investing in the securities involves
a number of risks. See “Risk Factors” beginning on page PS-10 of the accompanying product supplement, “Risk
Factors” beginning on page US-1 of the accompanying underlying supplement and “Risk Factors” beginning on page
6 of this document.
Neither the Securities and Exchange
Commission (the “SEC”) nor any state securities commission has approved or disapproved of the securities or passed
upon the accuracy or the adequacy of this document or the accompanying product supplement, underlying supplement, prospectus supplement
and prospectus. Any representation to the contrary is a criminal offense.
The securities are not bank deposits,
are not insured by the Federal Deposit Insurance Corporation or any other governmental agency and are not obligations of, or guaranteed
by, a bank.
You should read
this document together with the related product supplement, underlying supplement, prospectus supplement and prospectus, each
of which can be accessed via the hyperlinks below. Please also see “Additional Information about the Securities” at
the end of this document.
Product supplement
no. MS-1-I dated April 5, 2018: http://www.sec.gov/Archives/edgar/data/19617/000095010318004523/dp87526_424b2-ms1i.pdf
Underlying supplement
no. 1-I dated April 5, 2018: http://www.sec.gov/Archives/edgar/data/19617/000095010318004514/crt_dp87766-424b2.pdf
Prospectus supplement
and prospectus, each dated April 5, 2018: http://www.sec.gov/Archives/edgar/data/19617/000095010318004508/dp87767_424b2-ps.pdf
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
Investment Summary
The Trigger
Jump Securities
The Trigger Jump Securities Based
on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021 (the “securities”)
can be used:
|
|
§
|
As
an alternative to direct exposure to the ETF Shares that provides a fixed, positive return
of at least 21.85% (as reflected in the upside payment of at least $2.185 per $10 stated
principal amount security) if the final share price is greater than or equal to the initial
share price. The actual upside payment will be provided in the pricing supplement and
will not be less than $2.185 per $10 stated principal amount security.
|
|
|
§
|
To
enhance returns and potentially outperform the ETF Shares in a moderately bullish scenario.
|
|
|
§
|
To
obtain limited market downside protection against the loss of principal in the event
of a decline of the ETF Shares as of the valuation date, subject to the credit risks
of JPMorgan Financial and JPMorgan Chase & Co., but only if the final share price
is greater than or equal to the trigger level.
|
If the final
share price is less than the trigger level, the securities are exposed on a 1-to-1 basis to any percentage decline of the final
share price from the initial share price. Accordingly, investors may lose their entire initial investment in the securities.
|
Maturity:
|
Approximately
2 years
|
|
Upside
payment:
|
At
least $2.185 per $10 stated principal amount security (at least 21.85% of the stated principal amount) (to be provided in
the pricing supplement)
|
|
Trigger
level:
|
90%
of the initial share price
|
|
Minimum
payment at maturity:
|
None. Investors
may lose their entire initial investment in the securities
|
|
Interest:
|
None
|
Supplemental
Terms of the Securities
For
purposes of the accompanying product supplement, the iShares® MSCI Emerging Markets ETF is a “Fund.”
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
Key Investment
Rationale
This investment offers a fixed,
positive return at maturity if the final share price is greater than or equal to the initial share price, and provides limited
market downside protection against a decline in the ETF Shares of up to 10%, subject to the credit risks of JPMorgan Financial
and JPMorgan Chase & Co. However, if the final share price is less than 90% of the initial share price, which we refer to
as the trigger level, the payment at maturity will be less than $9 and could be zero.
|
Upside
Scenario
|
If
the final share price is greater than or equal to the initial share price, the payment at maturity for each security will
be equal to $10.00 plus the upside payment of at least $2.185 per $10 stated principal amount security. The
actual upside payment will be provided in the pricing supplement and will not be less than $2.185 per $10 stated principal
amount security.
|
|
Par
Scenario
|
If
the final share price is less than the initial share price but is greater than or equal to the trigger level, which means
that the ETF Shares have depreciated by no more than 10% from the initial share price, the payment at maturity will be $10
per $10 stated principal amount security.
|
|
Downside
Scenario
|
If
the final share price is less than the trigger level, which means that the ETF Shares have depreciated by more than
10% from the initial share price, you will lose 1% for every 1% decline of the price of the ETF Shares from the initial
share price to the final share price (e.g., a 50% depreciation of the ETF Shares will result in the payment at maturity
that is less than the stated principal amount by 50%, or $5 per $10 stated principal amount security).
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
How the Trigger
Jump Securities Work
Payoff Diagram
The payoff diagram below illustrates
the payment at maturity on the securities based on the following terms:
|
Stated
principal amount:
|
$10
per stated principal amount security
|
|
Hypothetical
upside payment:
|
$2.185
(21.85% of the stated principal amount) per $10 stated principal amount security (which represents the lowest hypothetical
upside payment)*
|
|
Trigger
level:
|
90%
of the initial share price (-10% percent change in the final share price compared with the initial share price)
|
|
|
|
|
*The actual upside
payment will be provided in the pricing supplement and will not be less than $2.185 per $10 stated principal amount security.
|
|
Trigger
Jump Securities Payoff Diagram
|
|
How it
works
|
|
§
|
Upside
Scenario: If the final share price is greater
than or equal to the initial share price, the payment at maturity in all cases is
equal to the $10 stated principal amount plus the upside payment. Under the hypothetical
terms of the securities, in the payoff diagram, an investor would receive the hypothetical
payment at maturity of $12.185 per security if the final share price is greater than
or equal to the initial share price.
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
|
|
■
|
Par
Scenario: If
the final share price is less than the initial share price, but is greater
than or equal to the trigger level, the investor would receive the $10 stated principal
amount per security.
|
|
|
o
|
For
example, if the ETF Shares depreciates 5%, investors will receive the $10 stated principal amount.
|
|
|
■
|
Downside
Scenario: If
the final share price is less than the trigger level, investors will receive an
amount that is less than the stated principal amount by an amount proportionate to the
percentage decrease of the final share price from the initial share price.
|
|
|
o
|
For
example, if the ETF Shares decline by 50% from the initial share price, investors will
lose 50% of their principal and the payment at maturity will be $5 per $10 stated principal
amount security (50% of the stated principal amount).
|
The
hypothetical returns and hypothetical payments on the securities shown above apply only if you hold the securities for their
entire term. These hypotheticals do not reflect fees or expenses that would be associated with any sale in the secondary market.
If these fees and expenses were included, the hypothetical returns and hypothetical payments shown above would likely be lower.
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
Risk
Factors
The
following is a non-exhaustive list of certain key risk factors for investors in the securities. For further discussion of these
and other risks, you should read the sections entitled “Risk Factors” of the accompanying product supplement and the
accompanying underlying supplement. We urge you to consult your investment, legal, tax, accounting and other advisers in connection
with your investment in the securities.
|
|
■
|
The
securities do not pay interest or guarantee the return of any principal and your investment in the securities may result in a
loss. The terms of the securities differ from those of ordinary debt securities in
that the securities do not pay interest or guarantee the payment of any stated principal
amount at maturity. If the final share price is less than the trigger level, you will receive for each security that you hold
a payment at maturity that is less than the $10 stated principal amount of each security
by an amount proportionate to the decline in the closing price of one ETF Share on the valuation date from the initial share price.
There is no minimum payment at maturity on the securities and, accordingly, you could
lose your entire principal amount.
|
|
|
■
|
Appreciation
potential is fixed and limited. When the final
share price is greater than or equal to the initial share price, the appreciation potential
of the securities is limited to the fixed upside payment of at least $2.185 per security
(at least 21.85% of the stated principal amount), even if the final share price is significantly
greater than the initial share price. The actual upside payment will be provided in the
pricing supplement. See “How the Trigger Jump Securities Work” on page 4
above.
|
|
|
■
|
Your
ability to receive the upside payment may terminate on the valuation date. If
the final share price is less than the initial share price, you will not be entitled
to receive the upside payment at maturity. Under these circumstances, you may lose some
or all of your principal amount at maturity.
|
|
|
■
|
The
securities are subject to the credit risks of JPMorgan Financial and JPMorgan Chase &
Co., and any actual or anticipated changes to our or JPMorgan Chase & Co.’s
credit ratings or credit spreads may adversely affect the market value of the securities.
Investors are dependent on our and JPMorgan Chase & Co.’s ability to pay
all amounts due on the securities. Any actual or anticipated decline in our or JPMorgan
Chase & Co.’s credit ratings or increase in our or JPMorgan Chase & Co.’s
credit spreads determined by the market for taking that credit risk is likely to adversely
affect the market value of the securities. If we and JPMorgan Chase & Co. were to
default on our payment obligations, you may not receive any amounts owed to you under
the securities and you could lose your entire investment.
|
|
|
■
|
As
a finance subsidiary, JPMorgan Financial has no independent operations and has limited
assets. As a finance subsidiary of JPMorgan Chase & Co., we have no independent
operations beyond the issuance and administration of our securities. Aside from the initial
capital contribution from JPMorgan Chase & Co., substantially all of our assets relate
to obligations of our affiliates to make payments under loans made by us or other intercompany
agreements. As a result, we are dependent upon payments from our affiliates to meet our
obligations under the securities. If these affiliates do not make payments to us and
we fail to make payments on the securities, you may have to seek payment under the related
guarantee by JPMorgan Chase & Co., and that guarantee will rank pari passu
with all other unsecured and unsubordinated obligations of JPMorgan Chase & Co.
|
|
|
■
|
Economic
interests of the issuer, the guarantor, the calculation agent, the agent of the offering
of the securities and other affiliates of the issuer may be different from those of investors.
We and our affiliates play a variety of roles in
connection with the issuance of the securities, including acting as calculation agent
and as an agent of the offering of the securities, hedging our obligations under the
securities and making the assumptions used to determine the pricing of the securities
and the estimated value of the securities, which we refer to as the estimated value of
the securities. In performing these duties, our and JPMorgan Chase & Co.’s
economic interests and the economic interests of the calculation agent and other affiliates
of ours are potentially adverse to your interests as an investor in the securities.
The calculation agent will determine the initial share price, the trigger level and the
final share price and will calculate the amount of payment you will receive at maturity,
if any. Determinations made by the calculation agent, including with respect to the occurrence
or non-occurrence of market disruption events, the selection of a successor to the ETF
Shares or calculation of the final share price in the event of a discontinuation of the
ETF Shares, and any anti-dilution adjustments, may affect the payment to you at maturity.
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
In
addition, our and JPMorgan Chase & Co.’s business activities, including hedging
and trading activities, could cause our and JPMorgan Chase & Co.’s economic
interests to be adverse to yours and could adversely affect any payment on the securities and the value of the securities. It
is possible that hedging or trading activities of ours or our affiliates in connection with the securities could result in substantial
returns for us or our affiliates while the value of the securities declines. Please refer to “Risk Factors — Risks
Relating to Conflicts of Interest” in the accompanying product supplement for additional information about these risks.
|
|
■
|
The
benefit provided by the trigger level may terminate on the valuation date. If the
final share price is less than the trigger level, the benefit provided by the trigger
level will terminate and you will be fully exposed to any depreciation of the ETF Shares.
|
|
|
■
|
The
estimated value of the securities will be lower than the original issue price (price
to public) of the securities. The estimated value
of the securities is only an estimate determined by reference to several factors. The
original issue price of the securities will exceed the estimated value of the securities
because costs associated with selling, structuring and hedging the securities are included
in the original issue price of the securities. These costs include the selling commissions,
the structuring fee, the projected profits, if any, that our affiliates expect to realize
for assuming risks inherent in hedging our obligations under the securities and the estimated
cost of hedging our obligations under the securities. See “Additional Information
about the Securities — The estimated value of the securities” in this document.
|
|
|
■
|
The
estimated value of the securities does not represent future values of the securities
and may differ from others’ estimates. The
estimated value of the securities is determined by reference to internal pricing models
of our affiliates. This estimated value of the securities is based on market conditions
and other relevant factors existing at the time of pricing and assumptions about market
parameters, which can include volatility, dividend rates, interest rates and other factors.
Different pricing models and assumptions could provide valuations for the securities
that are greater than or less than the estimated value of the securities. In addition,
market conditions and other relevant factors in the future may change, and any assumptions
may prove to be incorrect. On future dates, the value of the securities could change
significantly based on, among other things, changes in market conditions, our or JPMorgan
Chase & Co.’s creditworthiness, interest rate movements and other relevant
factors, which may impact the price, if any, at which JPMS would be willing to buy securities
from you in secondary market transactions. See “Additional Information about the
Securities — The estimated value of the securities” in this document.
|
|
|
■
|
The
estimated value of the securities is derived by reference to an internal funding rate.
The internal funding rate used in the determination
of the estimated value of the securities may differ from the market-implied funding rate
for vanilla fixed income instruments of a similar maturity issued by JPMorgan Chase &
Co. or its affiliates. Any difference may be based on, among other things, our and our
affiliates’ view of the funding value of the securities as well as the higher issuance,
operational and ongoing liability management costs of the securities in comparison to
those costs for the conventional fixed income instruments of JPMorgan Chase & Co.
This internal funding rate is based on certain market inputs and assumptions, which may
prove to be incorrect, and is intended to approximate the prevailing market replacement
funding rate for the securities. The use of an internal funding rate and any potential
changes to that rate may have an adverse effect on the terms of the securities and any
secondary market prices of the securities. See “Additional Information about the
Securities — The estimated value of the securities” in this document.
|
|
|
■
|
The
value of the securities as published by JPMS (and which may be reflected on customer
account statements) may be higher than the then-current estimated value of the securities
for a limited time period. We generally expect that some of the costs included in
the original issue price of the securities will be partially paid back to you in connection
with any repurchases of your securities by JPMS in an amount that will decline to zero
over an initial predetermined period. These costs can include selling commissions, the
structuring fee, projected hedging profits, if any, and, in some circumstances, estimated
hedging costs and our internal secondary market funding rates for structured debt issuances.
See “Additional Information about the Securities — Secondary market prices
of the securities” in this document for additional information relating to this
initial period. Accordingly, the estimated value of your securities during this initial
period may be lower than the value of the securities as published by JPMS (and which
may be shown on your customer account statements).
|
|
|
■
|
Secondary
market prices of the securities will likely be lower than the original issue price of
the securities. Any secondary market prices of the
securities will likely be lower than the original issue price of the securities because,
among other things, secondary market prices take into account our internal
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
secondary
market funding rates for structured debt issuances and, also, because secondary market
prices may exclude selling commissions, the structuring fee, projected hedging profits,
if any, and estimated hedging costs that are included in the original issue price of
the securities. As a result, the price, if any, at which JPMS will be willing to buy
securities from you in secondary market transactions, if at all, is likely to be lower
than the original issue price. Any sale by you prior to the maturity date could result
in a substantial loss to you. See the immediately following risk factor for information
about additional factors that will impact any secondary market prices of the securities.
The
securities are not designed to be short-term trading instruments. Accordingly, you should be able and willing to hold your securities
to maturity. See “— Secondary trading may be limited” below.
|
|
■
|
Secondary
market prices of the securities will be impacted by many economic and market factors.
The secondary market price of the securities during their term will be impacted by a
number of economic and market factors, which may either offset or magnify each other,
aside from the selling commissions, structuring fee, projected hedging profits, if any,
estimated hedging costs and the closing price of one ETF Share, including:
|
|
|
o
|
any
actual or potential change in our or JPMorgan Chase & Co.’s creditworthiness
or credit spreads;
|
|
|
o
|
customary
bid-ask spreads for similarly sized trades;
|
|
|
o
|
our
internal secondary market funding rates for structured debt issuances;
|
|
|
o
|
the
actual and expected volatility of the ETF Shares;
|
|
|
o
|
the
time to maturity of the securities;
|
|
|
o
|
the
dividend rates on the ETF Shares and the equity securities underlying the ETF Shares;
|
|
|
o
|
interest
and yield rates in the market generally;
|
|
|
o
|
the
exchange rates and the volatility of the exchange rates between the U.S. dollar and each
of the currencies in which the equity securities underlying the ETF Shares trade and
the correlation among those rates and the price of one ETF Share;
|
|
|
o
|
the
occurrence of certain events to the ETF Shares that may or may not require an adjustment
to the share adjustment factor; and
|
|
|
o
|
a
variety of other economic, financial, political, regulatory and judicial events.
|
Additionally,
independent pricing vendors and/or third party broker-dealers may publish a price for the securities, which may also be reflected
on customer account statements. This price may be different (higher or lower) than the price of the securities, if any, at which
JPMS may be willing to purchase your securities in the secondary market.
|
|
■
|
Investing
in the securities is not equivalent to investing in the ETF Shares. Investing in
the securities is not equivalent to investing in the ETF Shares, the index tracked by
the ETF Shares, which we refer to as the underlying index, or the stocks underlying the
ETF Shares or the underlying index. Investors in the securities will not have voting
rights or rights to receive dividends or other distributions or any other rights with
respect to the ETF Shares, the reference index or the stocks held by the ETF Shares or
the underlying index.
|
|
|
■
|
Adjustments
to the ETF Shares or the underlying index could adversely affect the value of the securities.
Those responsible for calculating and maintaining the ETF Shares and the underlying
index, can add, delete or substitute the components of the ETF Shares or the underlying
index, or make other methodological changes that could change the value of the ETF Shares
or the underlying index. Any of these actions could adversely affect the price of the
ETF Shares and, consequently, the value of the securities.
|
|
|
■
|
There
are risks associated with the ETF Shares. Although the ETF Shares are listed for trading on NYSE Arca, Inc. and a number of
similar products have been traded on various national securities exchanges for varying periods of time, there is no assurance
that an active trading market will continue for the ETF Shares or that there will be liquidity in the trading market. The ETF
Shares are subject to
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
management
risk, which is the risk that the investment strategy of the investment adviser to the ETF Shares, the implementation of which
is subject to a number of constraints, may not produce the intended results. These constraints could adversely affect the market
price of the ETF Shares and, consequently, the value of the securities.
|
|
■
|
The
performance and market value of the ETF Shares, particularly during periods of market
volatility, may not correlate with the performance of the underlying index as well as
the net asset value per ETF Share. The iShares® MSCI Emerging Markets
ETF does not fully replicate the underlying index and may hold securities different from
those included in the underlying index. In addition, the performance of the ETF Shares
will reflect additional transaction costs and fees that are not included in the calculation
of the underlying index. All of these factors may lead to a lack of correlation between
the performance of the ETF Shares and the underlying index. In addition, corporate actions
with respect to the equity securities underlying the ETF Shares (such as mergers and
spin-offs) may impact the variance between the performances of the ETF Shares and the
underlying index. Finally, because the ETF Shares are traded on a securities exchange
and are subject to market supply and investor demand, the market value of one ETF Share
may differ from the net asset value per ETF Share.
|
During
periods of market volatility, securities underlying the ETF Shares may be unavailable in the secondary market, market participants
may be unable to calculate accurately the net asset value per ETF Share and the liquidity of the ETF Shares may be adversely affected.
This kind of market volatility may also disrupt the ability of market participants to create and redeem ETF Shares. Further, market
volatility may adversely affect, sometimes materially, the prices at which market participants are willing to buy and sell ETF
Shares. As a result, under these circumstances, the market value of ETF Shares may vary substantially from the net asset value
per ETF Share. For all of the foregoing reasons, the performance of the ETF Shares may not correlate with the performance of the
underlying index as well as its net asset value per ETF Share, which could materially and adversely affect the value of the securities
in the secondary market and/or reduce any payment on the securities.
|
|
■
|
The
securities are subject to risks associated with securities issued by non-U.S. companies.
The equity securities underlying the ETF Shares have been issued by non-U.S. companies.
Investments in securities linked to the value of such non-U.S. equity securities involve
risks associated with the securities markets in the home countries of the issuers of
those non-U.S. equity securities, including risks of volatility in those markets, governmental
intervention in those markets and cross shareholdings in companies in certain countries.
Also, there is generally less publicly available information about companies in some
of these jurisdictions than there is about U.S. companies that are subject to the reporting
requirements of the SEC.
|
|
|
■
|
The
securities are subject to currency exchange risk.
Because
the prices of the equity securities underlying the ETF Shares are converted into U.S.
dollars for the purposes of calculating the net asset value of the ETF Shares,
holders of the securities will be exposed to currency exchange rate risk with respect
to the currencies in which securities underlying the ETF Shares are
traded. Your net exposure will depend on the extent to which the currencies in which
securities underlying the ETF Shares are
traded strengthen or weaken against the U.S. dollar. If the U.S. dollar strengthens against
the currencies in which securities underlying the ETF Shares are
traded, the net asset value of the ETF Shares will
be adversely affected and the amount we pay you at maturity may be reduced. Of particular
importance to potential currency exchange risk are:
|
|
|
o
|
existing
and expected rates of inflation;
|
|
|
o
|
existing
and expected interest rate levels;
|
|
|
o
|
the
balance of payments in the countries issuing those currencies and the United States and
between each country and its major trading partners;
|
|
|
o
|
political,
civil or military unrest in the countries issuing those currencies and the United States;
and
|
|
|
o
|
the
extent of government surpluses or deficits in the countries issuing those currencies
and the United States.
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
All
of these factors are in turn sensitive to the monetary, fiscal and trade policies pursued by the governments of the countries
issuing those currencies and the United States and other countries important to international trade and finance.
|
|
■
|
The
securities entail emerging markets risk. The equity securities underlying the ETF
Shares have been issued by non-U.S. companies located in emerging markets countries.
Countries with emerging markets may have relatively unstable governments, may present
the risks of nationalization of businesses, restrictions on foreign ownership and prohibitions
on the repatriation of assets, and may have less protection of property rights than more
developed countries. The economies of countries with emerging markets may be based
on only a few industries, may be highly vulnerable to changes in local or global trade
conditions, and may suffer from extreme and volatile debt burdens or inflation rates.
Local securities markets may trade a small number of securities and may be unable to
respond effectively to increases in trading volume, potentially making prompt liquidation
of holdings difficult or impossible at times.
|
|
|
■
|
Owning
the securities is not the same as owning the ETF Shares. Owning the securities
is not the same as owning the ETF Shares. Accordingly, changes in the closing
price of one ETF Share may not result in a comparable change of the market value of the
securities. If the closing price of one
ETF Share on any trading day increases above the initial share price, the value of the
securities may not increase comparably, if at all. It is possible for the closing
price of one ETF Share to increase moderately while the value of the securities
declines.
|
|
|
■
|
The
anti-dilution protection for the ETF Shares is limited.
The calculation agent will make adjustments to the share adjustment factor for certain
events affecting the ETF Shares. However, the calculation agent will not make an
adjustment in response to all events that could affect the ETF Shares. If an event
occurs that does not require the calculation agent to make an adjustment, the value of
the securities may be materially and adversely affected.
|
|
|
■
|
Hedging
and trading activities by the issuer and its affiliates could potentially affect the value of the securities. The hedging
or trading activities of the issuer’s affiliates and of any other hedging counterparty with respect to the securities on
or prior to the pricing date and prior to maturity could adversely affect the price of the ETF Shares and, as a result, could
decrease the amount an investor may receive on the securities at maturity, if any. Any of these hedging or trading activities
on or prior to the pricing date could potentially affect the initial share price and the trigger level and, therefore, could potentially
increase the price that the final share price must reach before you receive a payment at maturity that exceeds the issue price
of the securities or so that you do not suffer a loss on your initial investment in the securities. Additionally, these hedging
or trading activities during the term of the securities, including on the valuation date, could adversely affect the final share
price and, accordingly, the payment to you at maturity, if any. It is possible that these hedging or trading activities could
result in substantial returns for us or our affiliates while the value of the securities declines.
|
|
|
■
|
Secondary
trading may be limited. The securities will
not be listed on a securities exchange. There may be little or no secondary market for the securities.
Even if there is a secondary market, it may not provide enough liquidity to allow you to trade or sell the securities
easily. JPMS may act as a market maker for the securities,
but is not required to do so. Because we do not expect that other market makers will participate significantly in the secondary
market for the securities, the price at which you may be able to trade your securities
is likely to depend on the price, if any, at which JPMS is willing to buy the
securities. If at any time JPMS or another agent
does not act as a market maker, it is likely that there would be little or no secondary market for the securities.
|
|
|
■
|
The
final terms and valuation of the securities will be provided in the pricing supplement. The final terms of the securities
will be provided in the pricing supplement. In particular, each of the estimated value of the securities and the upside payment
will be provided in the pricing supplement and each may be as low as the applicable minimum set forth on the cover of this document.
Accordingly, you should consider your potential investment in the securities based on the minimums for the estimated value of
the securities and the upside payment.
|
|
|
■
|
The
tax consequences of an investment in the securities are uncertain. There is no direct
legal authority as to the proper U.S. federal income tax characterization of the securities,
and we do not intend to request a ruling from the IRS. The IRS might not accept, and
a court might not uphold, the treatment of the securities described in “Additional
Information about the Securities ― Additional Provisions ― Tax considerations”
in this document and in “Material U.S. Federal Income Tax Consequences” in
the
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
accompanying product
supplement. If the IRS were successful in asserting an alternative treatment for the securities, the timing and character of any
income or loss on the securities could differ materially and adversely from our description herein. In addition, in 2007 Treasury
and the IRS released a notice requesting comments on the U.S. federal income tax treatment of “prepaid forward contracts”
and similar instruments. The notice focuses in particular on whether to require investors in these instruments to accrue income
over the term of their investment. It also asks for comments on a number of related topics, including the character of income
or loss with respect to these instruments; the relevance of factors such as the nature of the underlying property to which the
instruments are linked; the degree, if any, to which income (including any mandated accruals) realized by non-U.S. investors should
be subject to withholding tax; and whether these instruments are or should be subject to the “constructive ownership”
regime, which very generally can operate to recharacterize certain long-term capital gain as ordinary income and impose a notional
interest charge. While the notice requests comments on appropriate transition rules and effective dates, any Treasury regulations
or other guidance promulgated after consideration of these issues could materially and adversely affect the tax consequences of
an investment in the securities, possibly with retroactive effect. You should review carefully the section entitled “Material
U.S. Federal Income Tax Consequences” in the accompanying product supplement and consult your tax adviser regarding the
U.S. federal income tax consequences of an investment in the securities, including possible alternative treatments and the issues
presented by this notice.
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
iShares®
MSCI Emerging Markets ETF Overview
The
iShares® MSCI Emerging Markets ETF is an exchange-traded fund of iShares®, Inc. (“iShares®”),
a registered investment company, that seeks to track the investment results, before fees and expenses, of an index composed of
large- and mid-capitalization emerging market equities, which we refer to as the underlying index with respect to the iShares®
MSCI Emerging Markets ETF. The underlying index with respect to the iShares® MSCI Emerging Markets ETF is
currently the MSCI Emerging Markets Index. Information provided to or filed with the SEC by iShares pursuant to the Securities
Act of 1933 and the Investment Company Act of 1940 can be located by reference to the SEC file numbers 033-97598 and 811-09102,
respectively, through the SEC’s website at www.sec.gov. For additional information about the iShares®
MSCI Emerging Markets ETF, see the information set forth under “Fund Descriptions — The iShares® ETFs”
in the accompanying underlying supplement.
Information
as of market close on November 11, 2019:
|
|
Bloomberg
Ticker Symbol:
|
EEM
|
|
|
Current
Closing Price:
|
$43.37
|
|
|
52
Weeks Ago (on 11/12/2018):
|
$39.24
|
|
|
52
Week High (on 4/17/2019):
|
$44.59
|
|
|
52
Week Low (on 12/24/2018):
|
$38.16
|
The
following table sets forth the published high and low closing prices, as well as end-of-quarter closing prices, of one ETF Share
for each quarter in the period from January 1, 2014 through November 11, 2019. The graph following the table sets forth the daily
closing prices of one ETF Share during the same period. The closing price of one ETF Share on November 11, 2019 was $43.37. We
obtained the closing price information above and in the table and graph below from the Bloomberg Professional®
service (“Bloomberg”), without independent verification. The closing prices may have been adjusted by Bloomberg for
actions taken relating to the ETF Shares, such as stock splits. The historical closing prices of one ETF Share should not be taken
as an indication of future performance, and no assurance can be given as to the closing price of one ETF Share on the valuation
date.
|
iShares®
MSCI Emerging Markets ETF
|
High
|
Low
|
Period
End
|
|
2014
|
|
|
|
|
First
Quarter
|
$41.01
|
$37.11
|
$41.01
|
|
Second
Quarter
|
$43.95
|
$40.82
|
$43.23
|
|
Third
Quarter
|
$45.85
|
$41.56
|
$41.56
|
|
Fourth
Quarter
|
$42.44
|
$37.73
|
$39.29
|
|
2015
|
|
|
|
|
First
Quarter
|
$41.07
|
$37.92
|
$40.13
|
|
Second
Quarter
|
$44.09
|
$39.04
|
$39.62
|
|
Third
Quarter
|
$39.78
|
$31.32
|
$32.78
|
|
Fourth
Quarter
|
$36.29
|
$31.55
|
$32.19
|
|
2016
|
|
|
|
|
First
Quarter
|
$34.28
|
$28.25
|
$34.25
|
|
Second
Quarter
|
$35.26
|
$31.89
|
$34.36
|
|
Third
Quarter
|
$38.21
|
$33.77
|
$37.45
|
|
Fourth
Quarter
|
$38.10
|
$34.08
|
$35.01
|
|
2017
|
|
|
|
|
First
Quarter
|
$39.99
|
$35.43
|
$39.39
|
|
Second
Quarter
|
$41.93
|
$38.81
|
$41.39
|
|
Third
Quarter
|
$45.85
|
$41.05
|
$44.81
|
|
Fourth
Quarter
|
$47.81
|
$44.82
|
$47.12
|
|
2018
|
|
|
|
|
First
Quarter
|
$52.08
|
$45.69
|
$48.28
|
|
Second
Quarter
|
$48.14
|
$42.33
|
$43.33
|
|
Third
Quarter
|
$45.03
|
$41.14
|
$42.92
|
|
Fourth
Quarter
|
$42.93
|
$38.00
|
$39.06
|
|
2019
|
|
|
|
|
First
Quarter
|
$43.71
|
$38.45
|
$42.92
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
|
iShares®
MSCI Emerging Markets ETF
|
High
|
Low
|
Period
End
|
|
Second
Quarter
|
$44.59
|
$39.91
|
$42.91
|
|
Third
Quarter
|
$43.42
|
$38.74
|
$40.87
|
|
Fourth
Quarter (through Novmeber 11, 2019)
|
$44.08
|
$40.27
|
$43.37
|
|
iShares®
MSCI Emerging Markets ETF Historical Performance – Daily Closing Prices*
January
2, 2014 to November 11, 2019
|
|
|
|
|
*The
dotted line in the graph indicates the hypothetical trigger level, equal to 90% of the closing price of one ETF Share on November
11, 2019. The actual trigger level will be based on the closing price of one ETF Share on the pricing date.
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
This
document relates only to the securities offered hereby and does not relate to the ETF Shares. We have derived all disclosures
contained in this document regarding the iShares® MSCI Emerging Markets ETF from the publicly available documents
described in the first paragraph under this “iShares® MSCI Emerging Markets ETF Overview” section,
without independent verification. In connection with the offering of the securities, neither we nor the agent has participated
in the preparation of such documents or made any due diligence inquiry with respect to the iShares® MSCI Emerging
Markets ETF. Neither we nor the agent makes any representation that such publicly available documents or any other publicly
available information regarding the iShares® MSCI Emerging Markets ETF is accurate or complete. Furthermore,
we cannot give any assurance that all events occurring prior to the date hereof (including events that would affect the accuracy
or completeness of the publicly available documents described in the first paragraph under this “iShares®
MSCI Emerging Markets ETF Overview” section) that would affect the trading price of the ETF Shares (and therefore the price
of the ETF Shares at the time we price the securities) have been publicly disclosed. Subsequent disclosure of any such events
or the disclosure of or failure to disclose material future events concerning the iShares® MSCI Emerging Markets
ETF could affect the value received at maturity, if any, with respect to the securities and therefore the trading prices of the
securities.
Neither
we nor any of our affiliates makes any representation to you as to the performance of the ETF Shares.
The
MSCI Emerging Markets Index. The MSCI Emerging Markets Index is a free float-adjusted market capitalization index that
is designed to measure equity market performance of global emerging markets. For additional information about the MSCI Emerging
Markets Index, see the information set forth under “Equity Index Descriptions — The MSCI Indices” in the accompanying
underlying supplement.
Additional
Information about the Securities
Please
read this information in conjunction with the summary terms on the front cover of this document.
|
Additional
Provisions:
|
|
Postponement
of maturity date:
|
If
the scheduled maturity date is not a business day, then the maturity date will be the following business day. If
the scheduled valuation date is not a trading day or if a market disruption event occurs on that day so that the valuation
date is postponed and falls less than three business days prior to the scheduled maturity date, the maturity date of the securities
will be postponed to the third business day following the valuation date as postponed.
|
|
Minimum
ticketing size:
|
$1,000
/ 100 securities
|
|
Trustee:
|
Deutsche
Bank Trust Company Americas (formerly Bankers Trust Company)
|
|
Calculation
agent:
|
JPMS
|
|
The
estimated value of the securities:
|
The
estimated value of the securities set forth on the cover of this document is equal to
the sum of the values of the following hypothetical components: (1) a fixed-income debt
component with the same maturity as the securities, valued using the internal funding
rate described below, and (2) the derivative or derivatives underlying the economic terms
of the securities. The estimated value of the securities does not represent a minimum
price at which JPMS would be willing to buy your securities in any secondary market (if
any exists) at any time. The internal funding rate used in the determination of the estimated
value of the securities may differ from the market-implied funding rate for vanilla fixed
income instruments of a similar maturity issued by JPMorgan Chase & Co. or its affiliates.
Any difference may be based on, among other things, our and our affiliates’ view
of the funding value of the securities as well as the higher issuance, operational and
ongoing liability management costs of the securities in comparison to those costs for
the conventional fixed income instruments of JPMorgan Chase & Co. This internal funding
rate is based on certain market inputs and assumptions, which may prove to be incorrect,
and is intended to approximate the prevailing market replacement funding rate for the
securities. The use of an internal funding rate and any potential changes to that rate
may have an adverse effect on the terms of the securities and any secondary market prices
of the securities. For additional information, see “Risk Factors — The estimated
value of the securities is derived by reference to an internal funding rate” in
this document. The value of the derivative or derivatives underlying the economic terms
of the securities is derived from internal pricing models of our affiliates. These models
are dependent on inputs such as the traded market prices of comparable derivative instruments
and on various other inputs, some of which are market-observable, and which can include
volatility, dividend rates, interest rates and other
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
|
|
factors,
as well as assumptions about future market events and/or environments. Accordingly, the
estimated value of the securities on the pricing date is based on market conditions and
other relevant factors and assumptions existing at that time. See “Risk Factors
— The estimated value of the securities does not represent future values of the
securities and may differ from others’ estimates” in this document.
The
estimated value of the securities will be lower than the original issue price of the securities because costs associated with
selling, structuring and hedging the securities are included in the original issue price of the securities. These costs include
the selling commissions paid to JPMS and other affiliated or unaffiliated dealers, the structuring fee, the projected profits,
if any, that our affiliates expect to realize for assuming risks inherent in hedging our obligations under the securities and
the estimated cost of hedging our obligations under the securities. Because hedging our obligations entails risk and may be influenced
by market forces beyond our control, this hedging may result in a profit that is more or less than expected, or it may result
in a loss. A portion of the profits, if any, realized in hedging our obligations under the securities may be allowed to other
affiliated or unaffiliated dealers, and we or one or more of our affiliates will retain any remaining hedging profits. See “Risk
Factors — The estimated value of the securities will be lower than the original issue price (price to public) of the securities”
in this document.
|
|
Secondary
market prices of the securities:
|
For
information about factors that will impact any secondary market prices of the securities, see “Risk Factors —
Secondary market prices of the securities will be impacted by many economic and market factors” in this document. In
addition, we generally expect that some of the costs included in the original issue price of the securities will be partially
paid back to you in connection with any repurchases of your securities by JPMS in an amount that will decline to zero over
an initial predetermined period that is intended to be the shorter of two years and one-half of the stated term of the securities. The
length of any such initial period reflects the structure of the securities, whether our affiliates expect to earn a profit
in connection with our hedging activities, the estimated costs of hedging the securities and when these costs are incurred,
as determined by our affiliates. See “Risk Factors — The value of the securities as published by JPMS
(and which may be reflected on customer account statements) may be higher than the then-current estimated value of the securities
for a limited time period.”
|
|
Tax
considerations:
|
You
should review carefully the section entitled “Material U.S. Federal Income Tax
Consequences” in the accompanying product supplement no. MS-1-I. The following
discussion, when read in combination with that section, constitutes the full opinion
of our special tax counsel, Davis Polk & Wardwell LLP, regarding the material U.S.
federal income tax consequences of owning and disposing of the securities.
Based
on current market conditions, in the opinion of our special tax counsel, your securities should be treated as “open
transactions” that are not debt instruments for U.S. federal income tax purposes, as more fully described in “Material
U.S. Federal Income Tax Consequences — Tax Consequences to U.S. Holders — Notes Treated as Open Transactions
That Are Not Debt Instruments” in the accompanying product supplement. Assuming this treatment is respected, subject
to the possible application of the “constructive ownership” rules, the gain or loss on your securities should
be treated as long-term capital gain or loss if you hold your securities for more than a year, whether or not you are
an initial purchaser of securities at the issue price. The securities could be treated as “constructive ownership
transactions” within the meaning of Section 1260 of the Code, in which case any gain recognized in respect of the
securities that would otherwise be long-term capital gain and that was in excess of the “net underlying long-term
capital gain” (as defined in Section 1260) would be treated as ordinary income, and a notional interest charge would
apply as if that income had accrued for tax purposes at a constant yield over your holding period for the securities.
Our special tax counsel has not expressed an opinion with respect to whether the constructive ownership rules apply to
the securities. Accordingly, U.S. Holders should consult their tax advisers regarding the potential application of the
constructive ownership rules.
The
IRS or a court may not respect the treatment of the securities described above, in which case the timing and character
of any income or loss on your securities could be materially and adversely affected. In addition, in 2007 Treasury and
the IRS released a notice requesting comments on the U.S. federal income tax treatment of “prepaid forward contracts”
and similar instruments. The notice focuses in particular on whether to require investors in these instruments to accrue
income over the term of their investment. It also asks for comments on a number of related topics, including the character
of income or loss with respect to these instruments; the relevance of factors such as the nature of the underlying property
to which the instruments are linked; the degree, if any, to which income (including any mandated accruals) realized by
non-U.S. investors should be subject to withholding tax; and whether these instruments are or should be subject to the
constructive ownership regime described above. While the notice requests comments on appropriate
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
|
|
transition
rules and effective dates, any Treasury regulations or other guidance promulgated after
consideration of these issues could materially and adversely affect the tax consequences
of an investment in the securities, possibly with retroactive effect. You should consult
your tax adviser regarding the U.S. federal income tax consequences of an investment
in the securities, including the potential application of the constructive ownership
rules, possible alternative treatments and the issues presented by this notice.
Section
871(m) of the Code and Treasury regulations promulgated thereunder (“Section 871(m)”) generally impose a 30% withholding
tax (unless an income tax treaty applies) on dividend equivalents paid or deemed paid to Non-U.S. Holders with respect to certain
financial instruments linked to U.S. equities or indices that include U.S. equities. Section 871(m) provides certain exceptions
to this withholding regime, including for instruments linked to certain broad-based indices that meet requirements set forth in
the applicable Treasury regulations (such an index, a “Qualified Index”). Additionally, a recent IRS notice excludes
from the scope of Section 871(m) instruments issued prior to January 1, 2021 that do not have a delta of one with respect to underlying
securities that could pay U.S.-source dividends for U.S. federal income tax purposes (each an “Underlying Security”).
Based on certain determinations made by us, we expect that Section 871(m) will not apply to the securities with regard to Non-U.S.
Holders. Our determination is not binding on the IRS, and the IRS may disagree with this determination. Section 871(m) is complex
and its application may depend on your particular circumstances, including whether you enter into other transactions with respect
to an Underlying Security. If necessary, further information regarding the potential application of Section 871(m) will be provided
in the pricing supplement for the securities. You should consult your tax adviser regarding the potential application of Section
871(m) to the securities.
Withholding
under legislation commonly referred to as “FATCA” may (if the securities are recharacterized as debt instruments)
apply to amounts treated as interest paid with respect to the securities, as well as to payments of gross proceeds of a taxable
disposition, including redemption at maturity, of the securities, although under recently proposed regulations (the preamble to
which specifies that taxpayers are permitted to rely on them pending finalization), no withholding will apply to payments of gross
proceeds (other than any amount treated as interest). You should consult your tax adviser regarding the potential application
of FATCA to the securities.
|
|
Supplemental
use of proceeds and hedging:
|
The
securities are offered to meet investor demand for products that reflect the risk-return
profile and market exposure provided by the securities. See “How the Trigger Jump
Securities Work” in this document for an illustration of the risk-return profile
of the securities and “iShares® MSCI Emerging Markets ETF Overview”
in this document for a description of the market exposure provided by the securities.
The
original issue price of the securities is equal to the estimated value of the securities plus the selling commissions
paid to JPMS and other affiliated or unaffiliated dealers and the structuring fee, plus (minus) the projected profits
(losses) that our affiliates expect to realize for assuming risks inherent in hedging our obligations under the securities,
plus the estimated cost of hedging our obligations under the securities.
|
|
Benefit
plan investor considerations:
|
See
“Benefit Plan Investor Considerations” in the accompanying product supplement.
|
|
Supplemental
plan of distribution:
|
Subject
to regulatory constraints, JPMS intends to use its reasonable efforts to offer to purchase
the securities in the secondary market, but is not required to do so. JPMS, acting as
agent for JPMorgan Financial, will pay all of the selling commissions it receives from
us to Morgan Stanley Wealth Management. In addition, Morgan Stanley Wealth Management
will receive a structuring fee as set forth on the cover of this document for each security.
We
or our affiliate may enter into swap agreements or related hedge transactions with one of our other affiliates or unaffiliated
counterparties in connection with the sale of the securities and JPMS and/or an affiliate may earn additional income as
a result of payments pursuant to the swap or related hedge transactions. See “— Supplemental use of proceeds
and hedging” above and “Use of Proceeds and Hedging” in the accompanying product supplement.
We
expect that delivery of the securities will be made against payment for the securities on or about the original issue
date set forth on the front cover of this document, which will be the third business day following the pricing date of
the securities (this settlement cycle being referred to as “T+3”). Under Rule 15c6-1 of the Securities Exchange
Act of 1934, as amended, trades in the secondary market generally are required to settle in two business days, unless
the parties to that trade expressly agree otherwise. Accordingly, purchasers who wish to trade securities on any date
prior to two business days before delivery will be required to specify an alternate settlement cycle at the time of any
such trade to prevent a failed settlement and should consult their own advisors.
|
|
Where
you can find more information:
|
You may revoke your offer to purchase the
securities at any time prior to the time at which we accept such offer by notifying
the applicable agent. We reserve the right to change the terms of, or reject any offer to purchase, the securities
prior to their issuance. In the event of any changes to the terms of the securities,
we will notify you and you will be asked to accept
|
JPMorgan Chase Financial Company LLC
Trigger Jump Securities Based on the Performance of the iShares® MSCI Emerging Markets ETF due December 2, 2021
Principal at Risk Securities
|
such
changes in connection with your purchase. You may also choose to reject such changes,
in which case we may reject your offer to purchase.
You
should read this document together with the accompanying prospectus, as supplemented by the accompanying prospectus supplement,
relating to our Series A medium-term notes of which these securities are a part, and the more detailed information contained
in the accompanying product supplement and the accompanying underlying supplement.
This
document, together with the documents listed below, contains the terms of the securities and supersedes all other prior
or contemporaneous oral statements as well as any other written materials including preliminary or indicative pricing
terms, correspondence, trade ideas, structures for implementation, sample structures, stand-alone fact sheets, brochures
or other educational materials of ours. You should carefully consider, among other things, the matters set forth in the
“Risk Factors” sections of the accompanying product supplement and the accompanying underlying supplement,
as the securities involve risks not associated with conventional debt securities. We urge you to consult your investment,
legal, tax, accounting and other advisers before you invest in the securities.
You
may access these documents on the SEC website at www.sec.gov as follows (or if such address has changed, by reviewing
our filings for the relevant date on the SEC website):
•
Product supplement no. MS-1-I dated April 5, 2018:
http://www.sec.gov/Archives/edgar/data/19617/000095010318004523/dp87526_424b2-ms1i.pdf
•
Underlying supplement no. 1-I dated April 5, 2018:
http://www.sec.gov/Archives/edgar/data/19617/000095010318004514/crt_dp87766-424b2.pdf
•
Prospectus supplement and prospectus, each dated April 5, 2018:
http://www.sec.gov/Archives/edgar/data/19617/000095010318004508/dp87767_424b2-ps.pdf
Our
Central Index Key, or CIK, on the SEC website is 1665650, and JPMorgan Chase & Co.’s CIK is 19617.
As
used in this document, “we,” “us,” and “our” refer to JPMorgan Financial.
|
JPMorgan Chase & CO Prfd H (NYSE:JPMPH)
Historical Stock Chart
From Mar 2024 to Apr 2024
JPMorgan Chase & CO Prfd H (NYSE:JPMPH)
Historical Stock Chart
From Apr 2023 to Apr 2024
