Exchange Traded Options Agreement J.P.Morgan B. Special Statement for Uncovered Options Writers (cont.) Uncovered options writing Is thus suitable only for the knowledgeable Investor who understands the risks, has the financial capacity and the willingness to incur potentially substantial losses, and has sufficient liquid assets to meet applicable margin requirements. In this regard, V the value of the underlying Instrument moves against a writers uncovered options position, J.P. Morgan Securities U.0 may request significant additional margin payments, and J.D. Morgan SecurltleS LLC may liquidate stack or options positions in the investor's account with little or no prior notice, In accordance with the investors margin agreement. For combination and/or straddle wilting, where the Investor writes both a put and a call on the same underlying instrument, the potential risk Is unlimited, If a secondary market In options were to become unavailable, investors could not engage In dosing transactions, and an option writer would remain obligated until expiration assignment. The writer of an American-style option Is subject to being assigned an exercise at any time after he/she has written the option until the option expires. By contrast, the writer of a European-style option Is subject to exercise assignment only during the exercise period. C. Derivatives Approval Level Exchange Traded Options Level 1: Covered writing Lev& 2: Buying Options Level 3: Spreads El Level 5: Uncovered Writing E l Level 6: Combinations/Straddles Date OCC booklet and supplements sent to client: DIMEE-DED: mm d d y y y y D. Pre-Dispute Arbitration and Acknowledgment By signing this Agreement, I admowiedge that: (1) I requested the options approval level as indicated above; (2) I have received a copy of the booklet entitled, 'Characteristics end Risks of Standardized Options,' and it is expected that I will read the booklet; (3) I have rennewed the special statement for