The graph below illustrates the daily performance of the Index from
January 3, 2005 through May 4, 2015 based on information from
Bloomberg, without independent verification. The dotted line
represents a hypothetical Trigger Level of 1,215.568, equal to 80% of
the closing level of the Index on May 4, 2015. The actual Trigger
Level will be based on the Initial Index Level and will be finalized
on the Trade Date and provided in the pricing supplement.
Past performance of the Index is not indicative of the future
performance of the Index.
The historical levels of the Index should not be taken as an
indication of future performance, and no assurance can be given as to
the closing level of the Index on the Trade Date or the Final
Valuation Date. We cannot give you assurance that the performance of
the Index will result in the return of any of your principal amount.
Supplemental Plan of Distribution
We have agreed to indemnify UBS and JPMS against liabilities under
the Securities Act of 1933, as amended, or to contribute to payments
that UBS may be required to make relating to these liabilities as
described in the prospectus supplement and the prospectus. We will
agree that UBS may sell all or a part of the Securities that it
purchases from us to the public or its affiliates at the price to
public indicated on the cover hereof.
Subject to regulatory constraints, JPMS intends to offer to purchase
the Securities in the secondary market, but it is not required to
do so.
We or our affiliates 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" in this free writing prospectus and
"Use of Proceeds and Hedging" beginning on page PS-43 of the
accompanying product supplement no. UBS-1a-I.
JPMS's Estimated Value of the Securities
JPMS's estimated value of the Securities set forth on the cover of
this free writing prospectus 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 our internal
funding rate for structured debt described below, and (2) the
derivative or derivatives underlying the economic terms of the
Securities. JPMS's estimated value 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 JPMS's estimated value generally
represents a discount from the credit spreads for our conventional
fixed-rate debt. For additional information, see "Key Risks Risks
Relating to the Securities Generally JPMS's Estimated Value Is Not
Determined by Reference to Credit Spreads for Our Conventional
Fixed-Rate Debt." The value of the derivative or derivatives
underlying the economic terms of the Securities is derived from
JPMS's internal pricing models. 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 factors, as well as assumptions about future market events
and/or environments. Accordingly, JPMS's estimated value of the
Securities is determined when the terms of the Securities are set
based on market conditions and other relevant factors and assumptions
existing at that time. See "Key Risks Risks Relating to the
Securities Generally JPMS's Estimated Value Does Not Represent
Future Values of the Securities and May Differ from Others'
Estimates."
JPMS's 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 UBS, the projected profits, if any, that
our affiliates expect to realize for assuming risks inherent in
hedging our obligations under the