Statement of General Principles with respect to Allocations and Marketing of Securities

This statement summarizes J.P. Morgan’s global policy on the allocation and marketing of an offering of securities on behalf of a capital markets client and should not be construed as forming part of any agreement. That policy applies in relation to each offering that involves a marketing and book building exercise and for which J.P. Morgan has any responsibility for the marketing and allocation of the offering (including, for example, as a joint bookrunner).  This statement and that policy are qualified in each case by the requirements of law in each jurisdiction in which any marketing activity is undertaken and/or an allocation decision is made by J.P. Morgan.

The objective of the allocation process is to act in the best interests of the capital markets client (i.e., the issuer or selling security holder on whose behalf the offering is made).  However, allocations involve significant elements of judgment and experience and there can be no guarantee that the above objective will be achieved in any particular offering.  In exercising its judgment, J.P. Morgan will consider a variety of factors, with the understanding that there is no complete list of factors that may be considered. What may be important in an offering for one capital markets client may be less important in an offering for a different capital markets client or at a different time for that capital markets client.  Allocation decisions are also subject to the instructions of the capital markets client, and those instructions may take precedence or otherwise impact the allocation decisions made by J.P. Morgan.

In certain jurisdictions it is customary or otherwise required by applicable legal requirements to agree to relevant aspects of the offering process in advance with the capital markets clients.  In those jurisdictions, J.P. Morgan will send a statement to its capital markets client at an early stage addressing:

• the process J.P. Morgan will follow to determine its recommendations on pricing and allocation;
• details of the target investor group;
• that investor clients of J.P. Morgan may subscribe for the securities being offered, and that this may represent a potential conflict of interest; and
• if relevant, that J.P. Morgan or its affiliate(s) may take a principal position in the securities being offered, and that this may represent a potential conflict of interest.

So long as it is consistent with the objective of serving the best interest of the capital markets client, and is not otherwise prohibited by applicable regulations or other internal restrictions, J.P. Morgan may consider the experience of its relationship with an investor in order to provide an informed view in exercising its judgment during the allocation process.

Allocations will not be made:

• as consideration for or an inducement to receive excessive compensation for other services provided by J.P. Morgan;
• conditional upon after-market purchases by an investor client (so-called “laddering”);
• conditional upon purchases of or participation in future offerings by an investor client (so-called “tie-in agreements”); or
• to an executive officer or director of a company conditional upon future investment banking business or as consideration for past investment banking business (so-called “spinning”).

Similar principles apply to the selection of investors for marketing activities. As with allocations, the choice of investors to participate in marketing activities (such as investor sounding and roadshows) involves significant elements of judgment and experience.   These decisions are driven by the best interests of the capital markets client and are made in light of the particular circumstances of each offering, including the preferences of the capital markets client.

July 2017