20603065-JPM-Private-Bank

20603065-JPM-Private-Bank - BD HEDGING AND MONETIZATION...

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CONFIDENTIAL H E D G I N G A N D M O N E T I Z A T I O N BD Securities (including mutual funds) are not bank deposits and are not FDIC insured, nor are they obligations of or guaranteed by JPMorgan Chase Bank, N.A., J.P. Morgan Trust Company, N.A. or any of their affiliates. Securities (including mutual funds) involve investment risks, including possible loss of the principal invested. Please see important information at the end of the presentation. Banker Louise Valenti 212-464-2556 Investor Philip Schlakman 212-622-7030 Executive Compensation Specialist Robert Barbetti 212-464-0786 Jonathan Spira 212-464-0479 Banking Analyst Joseph Rizk 212-464-2519
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CONFIDENTIAL Agenda • Hedging and monetization •P R I SM • Rule 10b5-1 • Postpaid PrISM
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CONFIDENTIAL Hedging and monetization 2
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CONFIDENTIAL Diversifying restricted stock requires navigating complex rules and regulations • Insiders can typically sell only certain amounts during certain time periods • Volume restrictions can slow the sales process of illiquid stocks • Sales must be publicly disclosed to the regulators • Shareholder agreements may further limit flexibility • Stock price may be vulnerable if sale is not executed efficiently Clients should consult with their legal, tax or accounting advisor before undertaking restricted stock transactions Insiders/Affiliate Assuming exempt to Section 16 and in compliance with company policy. For illustrative purposes only. 3
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CONFIDENTIAL Rule 144 and Rule 145 impose significant timing requirements on restricted stock sales. .. Company must have been subject to SEC reporting requirements for at least 90 days before a Rule 144 sale 1-year holding requirement, including pre-IPO holding period* During any 3 months, greater of 1% of outstanding shares or average trading volume of previous 4 weeks may be sold** Insiders prohibited from “short-swing” profits arising from opposite way transactions for period 6 months before or after the sale (Section 16) Insiders prohibited from naked short sales (Section 16) Company policies require executives to observe trading windows/black-out periods to comply with insider trading laws prohibiting trading on material non-public information * For securities acquired in connection with an M&A transaction where a holder was an affiliate of the target but is not an affiliate of the acquirer, these requirements do not apply under Rule 145. ** If the trading volume of the securities is not available through an exchange, NASDAQ, or the consolidated transaction reporting system, the amount will be based solely on the one percent limitation. After the maximum number of shares that can be sold is determined, the seller must deduct from that number any shares sold by the seller in the preceding three-month period, as well as any shares sold by entities that have to aggregate with the seller.
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This note was uploaded on 10/18/2011 for the course LAW 700 taught by Professor Kim during the Spring '10 term at USC.

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20603065-JPM-Private-Bank - BD HEDGING AND MONETIZATION...

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