As filed with the Securities and Exchange Commission on April 13, 2001
Registration No. 333-___/811-07342
================================================================================
U.S. Securities and Exchange Commission
Washington, DC 20549
FORM N-14
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pre-Effective Amendment No. ___ Post-Effective Amendment No.___
(Check appropriate box or boxes)
Exact Name of Registrant as Specified in Charter:
J.P. MORGAN INSTITUTIONAL FUNDS
Area Code and Telephone Number:
(617) 557-0700
Address of Principal Executive Offices:
60 State Street, Suite 1300
Boston, Massachusetts 02109
Name and Address of Agent for Service:
Margaret W. Chambers
c/o Fund Distributors, Inc.
60 State Street, Suite 1300
Boston, Massachusetts 02109
Copies to:
JOSEPH J. BERTINI, ESQ. SARAH E. COGAN, ESQ. JOHN E. BAUMGARDNER,
PETER B. ELDRIDGE, ESQ. Simpson Thacher & Bartlett JR., ESQ.
J.P. Morgan Fleming Asset 425 Lexington Avenue Sullivan & Cromwell
Management (USA) Inc. New York, NY 10017-3954 125 Broad Street
522 Fifth Avenue New York, NY 10004
New York, NY 10036
================================================================================
Approximate Date of Proposed Public Offering: As soon as practicable after the
Registration Statement becomes effective under the Securities Act of 1933.
It is proposed that this filing will become effective on May 13, 2001 pursuant
to Rule 488 under the Securities Act of 1933.
Calculation of Registration Fee under the Securities Act of 1933: No filing fee
is required because an indefinite number of shares have previously been
registered on Form N-1A (Registration No. 033-54642/811-07342) pursuant to Rule
24f-2 under the Investment Company Act of 1940, as amended. The Registrant's
Form 24f-2 for the fiscal year ended May 31, 2000 was filed on October 3, 2000.
Pursuant to Rule 429, this Registration Statement relates to the aforesaid
Registration Statement on Form N-1A.
J.P.Morgan U.S. Equity Fund - Advisor Series
a series of J.P. Morgan Institutional Funds
60 State Street, Suite 1300
Boston, Massachusetts 02109
May 12, 2001
Dear Shareholder:
A special meeting of the shareholders of J.P.Morgan U.S. Equity Fund -
Advisor Series (the "Merging Fund"), a series of J.P. Morgan Institutional Funds
("JPMF"), will be held on July 3, 2001 at 9:00 a.m., Eastern time. Formal notice
of the meeting appears after this letter, followed by materials regarding the
meeting.
As you may be aware, The Chase Manhattan Corporation recently completed
a merger with J.P. Morgan & Co. Incorporated, the former corporate parent of the
investment adviser of the Merging Fund's assets, to form J.P. Morgan Chase & Co.
("JPMC"). As a result of this merger, JPMC is seeking to reorganize parts of its
investment management business and funds advised by its subsidiaries. At the
special meeting (the "Meeting"), shareholders will be asked to consider and vote
upon the proposed reorganization of the Merging Fund into JPMorgan Institutional
U.S. Equity Fund (the "Surviving Fund"), another series of J.P. Morgan
Institutional Funds ("JPMF") (the "Reorganization"). After the Reorganization,
shareholders of the Merging Fund would hold Class A Shares of the Surviving
Fund. The investment objective and policies of the Surviving Fund are identical
to those of the Merging Fund. Both the Merging Fund and the Surviving Fund
currently invest all of their investable assets in The U.S. Equity Portfolio
(the "Master Portfolio"). Concurrent with the Reorganization, the Surviving Fund
will cease to operate under a "master/feeder" structure and will instead invest
directly in portfolio securities. In connection with the Reorganization, the
Surviving Fund will be renamed "JPMorgan U.S. Equity Fund."
The Surviving Fund has also entered into agreements and plans of
reorganization with (i) JPMorgan Large Cap Equity Fund (formerly, Chase Vista
Large Cap Equity Fund), a series of Mutual Fund Select Group ("MFSG") with
similar investment objectives and policies to the Merging Fund (the "Chase Fund
Reorganization"), and (ii) another mutual fund whose assets are managed by J.P.
Morgan Investment Management Inc. ("JPMIM") with identical investment objectives
and policies to the Surviving Fund (the "Feeder Reorganization" and, together
with the Chase Fund Reorganization, the "Concurrent Reorganizations"). If the
Concurrent Reorganizations are approved by the shareholders of these other funds
and certain other conditions are met, these other funds will be reorganized into
the Surviving Fund. The consummation of the Reorganization is contingent upon
the consummation of the Feeder Reorganization.
At the Meeting, you will also be asked to consider and vote upon the
election of Trustees of JPMF.
The investment adviser for the assets of both of the Merging Fund and
the Surviving Fund is JPMIM.
Please see the enclosed Combined Prospectus/Proxy Statement for
detailed information regarding the proposed Reorganization, the Concurrent
Reorganizations and a comparison of the Merging Fund and to the Surviving Fund.
The cost and expenses associated with the Reorganization, including costs of
soliciting proxies, will be borne by JPMC and not by the Merging Fund, the
Surviving Fund, JPMF or their shareholders.
If approval of the Reorganization is obtained, you will automatically
receive Class A Shares of the Surviving Fund.
The Proposals have been carefully reviewed by the Board of Trustees of
JPMF, which has approved the Proposals.
THE BOARD OF TRUSTEES OF JPMF UNANIMOUSLY RECOMMENDS THAT YOU VOTE
"FOR" EACH OF THE PROPOSALS.
Following this letter is a list of commonly asked questions. If you
have any additional questions on voting of proxies and/or the meeting agenda,
please call us at 1-800-766-7722.
A proxy card is enclosed for your use in the shareholder meeting. This
card represents shares you held as of the record date, __________, 2001. IT IS
IMPORTANT THAT YOU COMPLETE, SIGN, AND RETURN YOUR PROXY CARD IN THE ENVELOPE
PROVIDED OR CALL ____________ AS SOON AS POSSIBLE. This will ensure that your
shares will be represented at the Meeting to be held on July 3, 2001.
Please read the enclosed materials carefully. You may, of course,
attend the meeting in person if you wish, in which case the proxy can be revoked
by you at the Meeting.
Sincerely,
Matthew Healey
Chairman
SPECIAL NOTE: Certain shareholders may receive a telephone call from D.F. King &
Co., Inc., us to answer any questions you may have or to provide assistance in
voting. Remember, your vote is important! Please sign, date and promptly mail
your proxy card(s) in the return envelope provided or call ________ in order to
vote.
2
WHY IS THE REORGANIZATION BEING PROPOSED?
The Reorganization is being proposed because each Fund's board believes it is in
the best interests of shareholders to operate in a multi-class rather than a
"master/feeder" structure.
IF THE REORGANIZATION IS APPROVED, WHAT WILL HAPPEN?
In connection with the Reorganization, the Merging Fund will transfer all of its
assets and liabilities to the Surviving Fund and will receive, in exchange,
Class A Shares of the Surviving Fund. The Merging Fund will then be liquidated
and the Class A Shares of the Surviving Fund will be distributed pro rata to
shareholders such as you. After the Reorganization, you will own Class A Shares
of the Surviving Fund rather than shares of the Merging Fund.
WHAT WILL BE THE EFFECT ON THE INVESTMENT STRATEGIES ASSOCIATED WITH MY
INVESTMENT IF THE PROPOSED CHANGES ARE APPROVED?
The Surviving Fund has identical investment objectives and policies to those of
the Merging Fund. Both the Merging Fund and the Surviving Fund currently invest
all of their investable assets in the Master Portfolio. Concurrent with the
Reorganization, the Surviving Fund will cease to operate under a "master/feeder"
structure and will instead invest its assets directly in portfolio securities.
HOW WILL THE FEES AND EXPENSES ASSOCIATED WITH MY INVESTMENT BE AFFECTED?
As a result of the Reorganization, the contractual (or pre-waiver) total expense
ratios are expected to be higher for your shares in the Surviving Fund than they
are for your shares in the Merging Fund. However, the actual (or post-waiver)
total expense ratios are expected to be the same or less for your shares in the
Surviving Fund than they are for your shares in the Merging Fund. This is
because JPMIM has contractually agreed to waive fees payable to it and reimburse
expenses so that the total expense ratio will remain the same for at least THREE
YEARS after the Reorganization.
WILL THERE BE ANY CHANGE IN WHO MANAGES MY INVESTMENT?
No. JPMIM will continue to manage the assets of the Surviving Fund after the
Reorganization.
WHO WILL PAY FOR THE REORGANIZATION?
The cost and expenses associated with the Reorganization, including costs of
soliciting proxies, will be borne by JPMC and not by either the Merging Fund or
the Surviving Fund (or shareholders of either fund).
WHAT IF I DO NOT VOTE OR VOTE AGAINST THE REORGANIZATION, YET APPROVAL OF THE
REORGANIZATION IS OBTAINED?
You will automatically receive Class A shares of the Surviving Fund.
3
HOW WILL THE PROPOSED CONCURRENT REORGANIZATIONS AFFECT MY INVESTMENT IF THEY
ARE APPROVED BY THE SHAREHOLDERS OF THE OTHER FUNDS?
If the Concurrent Reorganizations are approved and certain other conditions are
met, the assets and liabilities of these other merging funds will become assets
and liabilities of the Surviving Fund. The consummation of the Reorganization is
contingent upon the consummation of the Feeder Reorganization, but not on the
consummation of the Chase Fund Reorganization.
AS A HOLDER OF SHARES OF THE MERGING FUND, WHAT DO I NEED TO DO?
Please read the enclosed Combined Prospectus/Proxy Statement and vote. Your vote
is important! Accordingly, please sign, date and mail the proxy card(s) promptly
in the enclosed return envelope as soon as possible after reviewing the enclosed
Combined Prospectus/Proxy Statement.
MAY I ATTEND THE MEETING IN PERSON?
Yes, you may attend the Meeting in person. If you complete a proxy card and
subsequently attend the Meeting, your proxy can be revoked. Therefore, to ensure
that your vote is counted, we strongly urge you to mail us your signed, dated
and completed proxy card(s) even if you plan to attend the Meeting.
4
JPMorgan U.S. Equity Fund - Advisor Series
a series of J.P. Morgan Institutional Funds
60 State Street, Suite 1300
Boston, Massachusetts 02109
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON JULY 3, 2001
To the Shareholders of
JPMorgan U.S. Equity Fund - Advisor Series:
NOTICE IS HEREBY GIVEN THAT a Special Meeting of the shareholders
("Shareholders") of JPMorgan U.S. Equity Fund - Advisor Series (the "Merging
Fund"), a series of J.P. Morgan Institutional Funds ("JPMF"), will be held at
the offices of J.P. Morgan Chase & Co., 1211 Avenue of the Americas, 41st Floor,
New York, NY on July 3, 2001 at 9:00 a.m., (Eastern time) for the following
purposes:
ITEM 1. To consider and act upon a proposal to approve an Agreement
and Plan of Reorganization (the "Reorganization Plan") by
and among JPMF, on behalf of the Merging Fund, JPMF, on
behalf of JPMorgan Institutional U.S. Equity Fund (the
"Surviving Fund"), and J.P. Morgan Chase & Co., and the
transactions contemplated thereby, including (a) the
transfer of all of the assets and liabilities of the
Merging Fund to the Surviving Fund in exchange for Class A
Shares of the Surviving Fund (the "Class A Shares"), and
(b) the distribution of such Class A Shares to the
Shareholders of the Merging Fund in connection with the
liquidation of the Merging Fund.
ITEM 2. To elect __ Trustees to serve as members of the Board of
Trustees of JPMF.
ITEM 3. To transact such other business as may properly come before
the Special Meeting or any adjournment(s) thereof.
YOUR FUND TRUSTEES UNANIMOUSLY RECOMMEND THAT YOU VOTE IN FAVOR OF
ITEMS 1 AND 2.
Each proposal is described in the accompanying Combined
Prospectus/Proxy Statement. Attached as Appendix A to the Combined
Prospectus/Proxy Statement is a copy of the Reorganization Plan.
Shareholders of record as of the close of business on April 6, 2001
are entitled to notice of, and to vote at, the Special Meeting or any
adjournment(s) thereof.
SHAREHOLDERS ARE REQUESTED TO EXECUTE AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE THE ACCOMPANYING PROXY CARD WHICH IS
BEING SOLICITED BY THE BOARD OF TRUSTEES OF JPMF. THIS IS IMPORTANT TO ENSURE A
QUORUM AT THE SPECIAL MEETING. PROXIES MAY BE REVOKED AT ANY TIME BEFORE THEY
ARE EXERCISED BY SUBMITTING TO THE MERGING FUND A WRITTEN NOTICE OF REVOCATION
OR A SUBSEQUENTLY EXECUTED PROXY OR BY ATTENDING THE SPECIAL MEETING AND VOTING
IN PERSON.
Margaret W. Chambers
Secretary
May 12, 2001
2
COMBINED PROSPECTUS/PROXY STATEMENT
DATED MAY 12, 2001
ACQUISITION OF THE ASSETS AND LIABILITIES OF
JPMORGAN U.S. EQUITY FUND - ADVISOR SERIES
A SERIES OF J.P. MORGAN INSTITUTIONAL FUNDS
60 STATE STREET, SUITE 1300
BOSTON, MASSACHUSETTS 02109
(617) 557-0700
BY AND IN EXCHANGE FOR CLASS A SHARES OF
JPMORGAN INSTITUTIONAL U.S. EQUITY FUND,
A SERIES OF J.P. MORGAN INSTITUTIONAL FUNDS
60 STATE STREET, SUITE 1300
BOSTON, MASSACHUSETTS 02109
(617) 557-0700
This Combined Prospectus/Proxy Statement relates to the proposed
reorganization of J.P. Morgan U.S. Equity Fund - Advisor Series (the "Merging
Fund"), a series of J.P. Morgan Institutional Funds ("JPMF"), into J.P.
Morgan Institutional U.S. Equity Fund (the "Surviving Fund"), a series of
JPMF. If approved by shareholders of the Merging Fund, the proposed
reorganization will be effected by transferring all of the assets and
liabilities of the Merging Fund to the Surviving Fund, which has identical
investment objectives and policies to those of the Merging Fund, in exchange
for Class A shares of the Surviving Fund (the "Reorganization"). Therefore,
as a result of the proposed Reorganization, current shareholders of the
Merging Fund (the "Merging Fund Shareholders") will become shareholders of
the Surviving Fund ("Surviving Fund Shareholders"). JPMF is an open-end
management investment company offering shares in several portfolios. In
connection with the Reorganization, the JPMorgan Institutional U.S. Equity
Fund will be renamed "JPMorgan U.S. Equity Fund."
In connection with the proposed Reorganization, the Surviving Fund
will implement a new multi-class structure under which it will offer Class A,
Class B, Class C, Select Class and Institutional Class. If the proposed
Reorganization is approved by Merging Fund Shareholders, each Merging Fund
Shareholder will receive Class A shares (the "Class A Shares") of the
Surviving Fund with a value equal to such Merging Fund Shareholder's holdings
in the Merging Fund. Merging Fund Shareholders will not pay a sales charge on
Class A Shares received in the Reorganization or other JPMorgan Funds
subsequently purchased or received as a result of an exchange.
At the Meeting, you will also be asked to consider and vote upon the
election of Trustees of JPMF.
i
The terms and conditions of these transactions are more fully described
in this Combined Prospectus/Proxy Statement and in the Agreement and Plan of
Reorganization (the "Reorganization Plan") among JPMF, on behalf of the Merging
Fund, JPMF, on behalf of the Surviving Fund, and J.P. Morgan Chase & Co.,
attached to this Combined Prospectus/Proxy Statement as Appendix A.
The Board of Trustees for JPMF is soliciting proxies in connection with
a Special Meeting (the "Meeting") of Shareholders to be held on July 3, 2001 at
9:00 a.m., Eastern time, at the offices of J.P. Morgan Chase & Co., 1211 Avenue
of the Americas, 41st Floor, New York, NY, at which meeting shareholders in the
Merging Fund will be asked to consider and approve the proposed Reorganization
Plan, certain transactions contemplated by the Reorganization Plan and certain
other proposals. This Combined Prospectus/Proxy Statement constitutes the proxy
statement of the Merging Fund for the meeting of its Shareholders and also
constitutes JPMF's prospectus for Class A Shares that have been registered with
the Securities and Exchange Commission (the "Commission") and are to be issued
in connection with the Reorganization.
This Combined Prospectus/Proxy Statement, which should be retained for
future reference, sets forth concisely the information about JPMF that an
investor should know before voting on the proposals. The current Prospectuses,
Statements of Additional Information and Annual Reports of the Merging Fund and
the Surviving Fund (including the Annual Report of The U.S. Equity Portfolio),
and the Semi-Annual Reports of the Merging Fund and the Surviving Fund
(including the Semi-Annual Report of The U.S. Equity Portfolio) are incorporated
herein by reference, and the current Prospectus and Annual Report (including the
Annual Report of The U.S. Equity Portfolio), and Semi-Annual Report (including
the Semi-Annual Report of the U.S. Equity Portfolio) for the Surviving Fund is
enclosed with this Combined Prospectus/Proxy Statement. A Statement of
Additional Information relating to this Combined Prospectus/Proxy Statement
containing additional information about JPMF has been filed with the Commission
and is incorporated by reference into this Combined Prospectus/Proxy Statement.
A copy of the Statement of Additional Information, as well as the Prospectus,
Statement of Additional Information, Semi-Annual Report and Annual Report of the
Merging Fund (including the Annual Report for the U.S. Equity Portfolio), may be
obtained without charge by writing to JPMF at its address noted above or by
calling 1-800-766-7722.
This Combined Prospectus/Proxy Statement is expected to first be sent
to shareholders on or about May 12, 2001.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS COMBINED PROSPECTUS/PROXY STATEMENT. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS COMBINED PROSPECTUS/PROXY
STATEMENT AND IN THE MATERIALS EXPRESSLY INCORPORATED HEREIN BY REFERENCE AND,
IF GIVEN OR
ii
MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY JPMF.
INVESTMENTS IN THE SURVIVING FUND ARE SUBJECT TO RISK--INCLUDING THE POSSIBLE
LOSS OF PRINCIPAL. NO SHARES IN THE SURVIVING FUND ARE BANK DEPOSITS OR
OBLIGATIONS OF, OR GUARANTEED OR ENDORSED BY, ANY BANK AND ARE NOT FEDERALLY
INSURED BY, OBLIGATIONS OF, OR OTHERWISE SUPPORTED BY THE U.S. GOVERNMENT, THE
FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD OR ANY OTHER
AGENCY.
iii
TABLE OF CONTENTS
PAGE
INTRODUCTION.............................................................................1
PROPOSAL 1: REORGANIZATION PLAN.........................................................1
SUMMARY..................................................................................2
COMPARATIVE FEE AND EXPENSE TABLES.......................................................5
RISK FACTORS.............................................................................8
INFORMATION RELATING TO THE PROPOSED REORGANIZATION......................................9
PURCHASES, REDEMPTIONS AND EXCHANGES....................................................14
DISTRIBUTIONS AND TAXES.................................................................18
COMPARISON OF THE MERGING FUND'S AND THE SURVIVING FUND'S ORGANIZATION STRUCTURE........19
INFORMATION RELATING TO THE ADVISORY CONTRACTS AND OTHER SERVICES.......................21
PROPOSAL 2: ELECTION OF TRUSTEES........................................................24
INFORMATION RELATING TO VOTING MATTERS..................................................28
ADDITIONAL INFORMATION ABOUT JPMF.......................................................30
FINANCIAL STATEMENTS AND EXPERTS........................................................30
OTHER BUSINESS..........................................................................30
LITIGATION..............................................................................31
SHAREHOLDER INQUIRIES...................................................................31
APPENDIX A AGREEMENT AND PLAN OF REORGANIZATION.........................................1
iv
INTRODUCTION
GENERAL
This Combined Prospectus/Proxy Statement is being furnished to the
shareholders of the Merging Fund, an open-end management investment company, in
connection with the solicitation by the Board of Trustees of JPMF of proxies to
be used at a Special Meeting of Shareholders of the Merging Fund to be held on
July 3, 2001 at 9:00 a.m., Eastern time, at the offices of J.P. Morgan Chase &
Co., 1211 Avenue of the Americas, 41st Floor, New York, NY (together with any
adjournments thereof, the "Meeting"). It is expected that the mailing of this
Combined Prospectus/Proxy Statement will be made on or about May 12, 2001.
PROPOSAL 1: REORGANIZATION PLAN
-------------------------------
At the Meeting, Merging Fund Shareholders will consider and vote upon
the Agreement and Plan of Reorganization (the "Reorganization Plan") dated
_______, 2001 between JPMF, on behalf of the Merging Fund, JPMF, on behalf of
the Surviving Fund (the Merging Fund and the Surviving Fund are collectively
defined as the "Funds"), and J.P. Morgan Chase & Co., pursuant to which all of
the assets and liabilities of the Merging Fund will be transferred to the
Surviving Fund in exchange for Class A Shares of the Surviving Fund. As a result
of the Reorganization, Merging Fund Shareholders will become shareholders of the
Surviving Fund and will receive Class A Shares equal in value to their holdings
in the Merging Fund on the date of the Reorganization. In connection with the
Reorganization, the Surviving Fund will be renamed "JPMorgan U.S. Equity Fund."
Further information relating to the Surviving Fund is set forth herein, and the
Surviving Fund's Prospectus and Annual Report is enclosed with this Combined
Prospectus/Proxy Statement.
THE JPMF BOARD HAS UNANIMOUSLY RECOMMENDED THAT SHAREHOLDERS VOTE "FOR"
PROPOSAL 1.
VOTE REQUIRED
Approval of the Reorganization Plan by the Merging Fund requires the
affirmative vote of the lesser of (i) 67% or more of the shares of the Merging
Fund present at the Meeting if the holders of more than 50% of the outstanding
shares of the Merging Fund are present or represented by proxy and (ii) more
than 50% of all outstanding shares of the Merging Fund. If the Reorganization
Plan is not approved by the Merging Fund Shareholders, the JPMF Board will
consider other appropriate courses of action.
1
SUMMARY
The following is a summary of certain information relating to the
proposed Reorganization, the parties thereto and the transactions contemplated
thereby, and is qualified by reference to the more complete information
contained elsewhere in this Combined Prospectus/Proxy Statement, the Prospectus,
Statement of Additional Information and Annual Report (including the Annual
Report and Semi-Annual Report of The U.S. Equity Portfolio) of each of the
Surviving Fund and the Merging Fund, and the Reorganization Plan attached to
this Combined Prospectus/Proxy Statement as Appendix A.
PROPOSED REORGANIZATION
Each of the Surviving Fund and the Merging Fund currently invests all
of its investible assets in The U.S. Equity Portfolio (the "Master Portfolio"),
which has identical investment objectives and policies as the Surviving Fund and
the Merging Fund and which is advised by J.P. Morgan Investment Management Inc.
("JPMIM"). The Surviving Fund has also entered into plans of reorganization with
(i) JPMorgan Large Cap Equity Fund II (formerly, Chase Vista Large Cap Equity
Fund), a series of Mutual Fund Select Group ("MFSG") with similar investment
objectives and policies to the Merging Fund (the "Chase Fund Reorganization ")
and (ii) JPMorgan U.S. Equity Fund, a series of J.P. Morgan Funds - Advisor
Series whose assets are managed by JPMIM (the "Feeder Reorganization" and,
together with the Chase Fund Reorganization, the "Concurrent Reorganizations").
If each of the Reorganization and the Concurrent Reorganizations is
approved by the shareholders of the respective funds and certain other
conditions are met, the Merging Fund and these other funds will be reorganized
into the Surviving Fund. Concurrent with the Feeder Reorganization, the
Surviving Fund will cease to operate under a "master/feeder" structure and will
instead invest directly in portfolio securities rather than in the Master
Portfolio. The consummation of the Reorganization and the Concurrent
Reorganizations are contingent upon the consummation of the Feeder
Reorganization. The consummation of the Reorganization is not contingent upon
the consummation of the Chase Fund Reorganization.
In connection with the proposed Reorganization, the Surviving Fund will
implement a new multi-class structure under which it will offer Class A, Class
B, Class C, Select Class Shares and Institutional Class Shares. Pursuant to the
proposed Reorganization, the Merging Fund will transfer all of its assets and
liabilities to the Surviving Fund in exchange for Class A Shares.
Under the proposed Reorganization, each Merging Fund Shareholder will
receive a number of Class A Shares of the Surviving Fund with an aggregate net
asset value equal on the date of the exchange to the aggregate net asset value
of such shareholder's Merging Fund Shares on such date. Therefore, following the
proposed Reorganization, Merging Fund Shareholders will be Surviving Fund
Shareholders. Merging Fund Shareholders will not pay a sales load in connection
with the Reorganization. See "Information Relating to the Proposed
Reorganization."
The Surviving Fund has investment objectives, policies and restrictions
identical to the Merging Fund. However, while the Merging Fund and the Surviving
Fund currently invest all of
2
their assets in the Master Portfolio (which in turn invests in portfolio
securities), after the Reorganization the Surviving Fund will invest directly in
portfolio securities. Following the Reorganization the Surviving Fund will have
substantially similar purchase, redemption and dividend policies as the Merging
Fund.
Based upon their evaluation of the relevant information presented to
them, including an analysis of the operation of the Surviving Fund both before
and after the Reorganization, the terms of the Reorganization Plan, the
opportunity to combine the two Funds with identical investment objectives and
policies, and the fact that the Reorganization will be tax-free, and in light of
their fiduciary duties under federal and state law, the JPMF Board, including a
majority of each Board's members who are not "interested persons" within the
meaning of the Investment Company Act of 1940, as amended (the "1940 Act"), have
each determined that the proposed Reorganization is in the best interests of
each Fund and its respective shareholders and that the interests of such
shareholders will not be diluted as a result of such Reorganization.
REASONS FOR THE REORGANIZATION
The Reorganization is being proposed because each Fund's board
believes that it is in the best interest of the shareholders to operate in a
multi-class rather than a master/feeder structure.
FEDERAL INCOME TAX CONSEQUENCES
Simpson Thacher & Bartlett will issue an opinion (based on certain
assumptions) as of the effective time of the Reorganization to the effect that
the transaction will not give rise to the recognition of income, gain or loss
for federal income tax purposes to the Merging Fund, the Surviving Fund or the
shareholders of the Merging Fund. A shareholder's holding period and tax basis
of Class A Shares received by a shareholder of the Merging Fund will be the same
as the holding period and tax basis of the shareholder's shares of the Merging
Fund. In addition, the holding period and tax basis of those assets owned by the
Merging Fund and transferred to the Surviving Fund will be identical for the
Surviving Fund. See "Information Relating to the Proposed Reorganization -
Federal Income Tax Consequences."
INVESTMENT ADVISER
The investment adviser for the Master Portfolio (and therefore the
assets of the Merging Fund and the Surviving Fund) is JPMIM. Following the
Reorganization, JPMIM will serve as the Surviving Fund's investment adviser.
JPMIM is a wholly-owned subsidiary of J.P. Morgan Chase & Co. ("JPMC"). JPMIM
will continue to serve as investment advisor for the Surviving Fund following
the Reorganization.
INVESTMENT OBJECTIVE AND POLICIES
The investment objective of the Surviving Fund and the Merging Fund is
to provide high total return from a portfolio of selected equity securities. See
"Risk Factors." Both Funds have identical investment policies, and the Surviving
Fund's investment policies will not change after the Reorganization, although,
as mentioned above, the Surviving Fund will invest in portfolio securities
rather than the Master Portfolio. For more information regarding the Surviving
Fund's
3
investment policies, see the Surviving Fund's Prospectus enclosed with this
Combined Proxy Statement.
The Surviving Fund invests primarily in large- and
medium-capitalization U.S. companies. Industry by industry, the Surviving Fund's
weightings are similar to those of the Standard & Poor's 500 Stock Index (S&P
500). The Surviving Fund can moderately underweight or overweight industries
when it believes it will benefit performance. Within each industry, the
Surviving Fund focuses on those stocks that JPMIM believes are most undervalued.
PRINCIPAL RISKS OF INVESTING IN THE SURVIVING FUND
The principal risk factors associated with an investment in the
Surviving Fund are those typically associated with investing in a managed
portfolio of equity securities. In particular, the value of shares of the
Surviving Fund will be influenced by the performance of the securities selected
for its portfolio. The value of the Surviving Fund's shares will fluctuate in
response to movements in the stock market, especially movements of those stocks
included in the S&P 500. See "Risk Factors."
CERTAIN ARRANGEMENTS WITH SERVICE PROVIDERS
ADVISORY SERVICES
The investment adviser for the Surviving Fund's and the Merging Fund's
assets is JPMIM. JPMIM oversees the asset management of both funds. As
compensation for its services, JPMIM receives a management fee indirectly from
both funds at an annual rate of 0.40% of average daily net assets. Following the
Reorganization, JPMIM will manage the Surviving Fund's assets and will receive a
fee at an annual rate of 0.40% of average daily net assets.
OTHER SERVICES
J.P. Morgan Fund Distributors, Inc. ("the Distributor") is the
distributor for the Surviving Fund. Morgan Guaranty Trust Company of New York
("Morgan") currently serves as administrator and shareholder servicing agent and
an affiliate agent of JFD currently serves as sub-administrator. It is
anticipated that prior to the consummation of the Reorganization, Morgan will
merge with The Chase Manhattan Bank ("Chase") which will become the Surviving
Fund's administrator and shareholder servicing agent. The Bank of New York
("BONY") currently serves as fund accountant and custodian, and DST Systems,
Inc. ("DST") currently serves as transfer agent and dividend disbursing agent
for the Surviving Fund. It is anticipated that prior to the consummation of the
Reorganization, Chase will become the Surviving Fund's fund accountant and
custodian. PricewaterhouseCoopers LLP serves as the Surviving Fund's independent
accountants.
ADMINISTRATOR
In connection with the Reorganization, the administration fee paid
to Morgan will increase to 0.15% of average daily net assets on the first $26
billion of complex wide non-money market assets and 0.075% on complex wide
non-money market assets in excess of $26 billion.
ORGANIZATION
JPMF is organized as a Massachusetts business trust. Each of the
Merging Fund and the Surviving Fund is organized as a series of JPMF.
4
PURCHASES, REDEMPTIONS AND EXCHANGES
After the Reorganization, the procedures for making purchases,
redemptions and exchanges of Class A Shares of the Surviving Fund will be
substantially similar to those with respect to shares of the Merging Fund, as
described in this Combined Prospectus/Proxy Statement and the Surviving Fund's
Prospectus and Statement of Additional Information.
COMPARATIVE FEE AND EXPENSE TABLES
The table below shows (i) information regarding the fees and expenses
paid by each of the Merging Fund and the Surviving Fund that reflect current
expense arrangements, (ii) estimated fees and expenses on a pro forma basis
after giving effect to the Reorganization and the Feeder Reorganization but not
the Chase Fund Reorganization and (iii) estimated fees and expenses on a pro
forma basis for the Surviving Fund after giving effect to the Concurrent
Reorganizations. Under the proposed Reorganization, holders of Shares in the
Merging Fund will receive Class A Shares in the Surviving Fund. Please note that
the Surviving Fund currently has one class of shares. In connection with the
Reorganization, this class will be re-named "Institutional Class" and the Class
A share class, the Class B share class, Class C share class and the Select share
class will be introduced.
The table indicates that while contractual (pre-waiver) total expense
ratios for current shareholders of the Merging Fund are anticipated to be higher
following the Reorganization, actual (post-waiver) total expense ratios for
current shareholders of the Merging Fund are anticipated to be less or stay the
same following the Reorganization. This is because Morgan has agreed to waive
certain fees and/or reimburse certain expenses to ensure that actual total
operating expenses do not increase for at least three years.
THE MERGING FUND THE SURVIVING FUND
------------------------ ---------------------------
SHARES SHARES
------------------------ ---------------------------
SHAREHOLDER FEES (FEES PAID
DIRECTLY FROM YOUR INVESTMENT)--
Maximum Sales Charge (Load) when you
buy shares, shown as % of the offering
price .......................................... None None
Maximum Deferred Sales Charge
(Load) shown as lower of original
purchase price or redemption proceeds .......... None None
5
THE MERGING FUND THE SURVIVING FUND
------------------------ ---------------------------
SHARES SHARES
------------------------ ---------------------------
ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND
ASSETS)
Management Fees...................... .40% 0.40%
Distribution (12b-1) Fees............ .25% None
Other Expenses....................... .53% 0.23%
Total Annual Fund Operating Expenses. 1.18% 0.63%
Fee Waivers and Expense
Reimbursements(1)................. 0.13% None
Net Expenses......................... 1.05% 0.63%
- ----------------------
(1) Reflects an agreement by Morgan, an affiliate of JPMC, to reimburse the
Fund to the extent operating expenses (which exclude interest, taxes,
and extraordinary expenses) exceed 1.05% of average daily net assets
with respect to the Merging Fund through 9/30/01.
Class A
Shares
----------
SHAREHOLDER FEES
(FEES PAID DIRECTLY FROM YOUR
INVESTMENT)-
Maximum Sales Charge (Load) when your
buy shares, shown as % of the
offering price ........................... None
Maximum Deferred Sales Charge (Load)
shown as lower of original purchase
price or redemption
proceeds.................................. None
ANNUAL FUND OPERATING EXPENSES
(EXPENSES THAT ARE DEDUCTED FROM FUND
ASSETS)
Management Fees........................... 0.40%
Distribution (12b-1) Fees................. 0.25%
Other Expenses............................ 0.70%
Total Annual Fund Operating Expenses...... 1.35%
Fee Waivers and Expense Reimbursements(2). 0.30%
Net Expenses.............................. 1.05%
- --------------------
6
(2) Reflects an agreement by Morgan, an affiliate of JPMC, to reimburse the
Fund to the extent operating expenses (which exclude interest, taxes,
and extraordinary expenses) exceed 1.05% of average daily net assets
with respect to Class A Shares for a period of three years after the
Reorganization.
CLASS A SHARES
--------------
SHAREHOLDER FEES (FEES PAID
DIRECTLY FROM YOUR INVESTMENT)-
Maximum Sales Charge (Load)
when you buy shares, shown as
% of the offering price ................................... 5.75%
Maximum Deferred Sales Charge
(Load) shown as lower of
original purchase price or
redemption proceeds ....................................... None
ANNUAL FUND OPERATING
EXPENSES (EXPENSES THAT ARE
DEDUCTED FROM FUND ASSETS)
Management Fees ........................................... 0.40%
Distribution (12b-1) Fees ................................. 0.25%
Other Expense ............................................. 0.70%
Total Annual Fund Operating
Expense ................................................... 1.35%
Fee Waivers and
Expense Reimbursements .................................... 0.30%(A)
Net Expenses .............................................. 1.05%
- --------------------
(A) Reflects an agreement by Morgan, an affiliate of JPMC, to reimburse the
Fund to the extent total operating expenses (excluding interest, taxes,
and extraordinary expenses) exceed 1.05% of average daily net assets
with respect to Class A Shares for three years after the
Reorganization.
The table does not reflect charges or credits which investors might
incur if they invest through a financial institution.
EXAMPLE: This example helps investors compare the cost of investing in
the Funds with the cost of investing in other mutual funds. The example assumes:
- You invest $10,000;
- You sell all of your shares at the end of each period;
- Your investment has a 5% return each year; and
- Each Fund's operating expenses are waived for three years after the
Reorganization and unwaived for the period thereafter and remain the
same as shown above.
7
Although actual costs may be higher or lower, based upon these
assumptions your costs would be:
1 YEAR 3 YEARS 5 YEARS 10 YEARS
--------- ------- ------- --------
The Merging Fund.................... $107 $358 - -
The Surviving Fund.................. $ 64 $202 $351 $786
PRO FORMA COMBINED THE
SURVIVING FUND WITH FEEDER
Class A Shares..................... $107 $398 $649 $1541
PRO FORMA COMBINED THE
SURVIVING FUND WITH CONCURRENT REORGANIZATION
Class A Shares...................... $676 $890 $1186 $2027
Class A Shares without sales charge $107 $398 $649 $1541
RISK FACTORS
The following discussion highlights the principal risk factors
associated with an investment in the Surviving Fund. The Surviving Fund has
investment policies and investment restrictions, and therefore risks, identical
to those of the Merging Fund. This discussion is qualified in its entirety by
the more extensive discussion of risk factors set forth in the Prospectus and
Statement of Additional Information of the Surviving Fund, which are
incorporated herein by reference.
All mutual funds carry a certain amount of risk. You may lose money on
your investment in the Surviving Fund. The Surviving Fund may not achieve its
objective if JPMIM's expectations regarding particular securities or markets are
not met. The Surviving Fund could underperform its benchmark due to JPMIM's
securities and asset allocation choices.
In general, the value of an investment in the Surviving Fund will
fluctuate in response to movements in the stock market. Adverse market
conditions may from time to time cause the Fund to take temporary defensive
positions that are inconsistent with its principal investment strategies and may
hinder the Fund from achieving its investment objective.
The Surviving Fund does not expect to invest more than 20% of its
assets, at the time of purchase, in foreign securities, and therefore may be
subject to risks in addition to those associated with U.S. securities. For
example, international currency exchange rate movements could reduce gains or
create losses. Additionally, the Surviving Fund could lose money because of
foreign government actions, political instability or lack of adequate and/or
accurate information.
The Surviving Fund may buy when-issued and delayed delivery securities.
The Surviving Fund may invest in derivatives such as futures, options,
swaps and forward foreign currency contracts that are used for hedging the
portfolio or specific securities.
8
These derivatives may not fully offset the underlying positions. This could
result in losses to the Fund that would not have otherwise occurred. Derivatives
used for risk management may not have the intended effects and may result in
losses or missed opportunities. The counterparty to a derivatives contract could
default. Certain types of derivatives involve costs to the Fund which can reduce
returns. Derivatives that involve leverage could magnify losses.
The Surviving Fund may lend some of its portfolio securities in order
to earn income. When the Surviving Fund lends a security, there is a risk that
the loaned securities may not be returned if the borrower defaults. The
collateral the Surviving Fund receives from the borrower will be subject to the
risks of the securities in which it is invested.
The Surviving Fund may invest in illiquid securities. The Surviving
Fund could have difficulty valuing these holdings precisely. The Surviving Fund
could be unable to sell these securities at the time or price desired.
The Surviving Fund may use short-term trading to take advantage of
attractive or unexpected opportunities or to meet demands generated by
shareholder activity. Increased trading would raise the Surviving Fund's
transaction costs. Increased short-term capital gains distributions would raise
shareholders' income tax liability.
An investment in the Surviving Fund is not a deposit of any bank and is
not insured or guaranteed by the Federal Deposit Insurance Corporation or any
other government agency. You could lose money if you sell when the Surviving
Fund's share price is lower than when you invested.
INFORMATION RELATING TO THE PROPOSED REORGANIZATION
GENERAL
The terms and conditions under which the Reorganization may be
consummated are set forth in the Reorganization Plan. Significant provisions of
the Reorganization Plan are summarized below; however, this summary is qualified
in its entirety by reference to the Reorganization Plan, a copy of which is
attached as Appendix A to this Combined Prospectus/Proxy Statement and which is
incorporated herein by reference.
DESCRIPTION OF THE REORGANIZATION PLAN
The Reorganization Plan provides that at the Effective Time (as defined
in the Reorganization Plan) of the Reorganization, the assets and liabilities of
the Merging Fund will be transferred to and assumed by the Surviving Fund. In
exchange for the transfer of the assets and the assumption of the liabilities of
the Merging Fund, JPMF will issue at the Effective Time of the Reorganization
full and fractional Class A Shares of the Surviving Fund equal in aggregate
dollar value to the aggregate net asset value of full and fractional outstanding
shares of the Merging Fund as determined at the valuation time specified in the
Reorganization Plan. The Reorganization Plan provides that the Merging Fund will
declare a dividend or dividends prior to the Effective Time of the
Reorganization which, together with all previous dividends, will have the effect
of distributing to Merging Fund Shareholders all undistributed net investment
income
9
earned and net capital gain realized up to and including the Effective Time of
the Reorganization.
Following the transfer of assets to, and the assumption of the
liabilities of the Merging Fund by, the Surviving Fund, the Merging Fund will
distribute Class A Shares received by it to the Merging Fund Shareholders in
liquidation of the Merging Fund. Each Merging Fund Shareholder at the Effective
Time of the Reorganization will receive an amount of Class A Shares with a total
net asset value equal to the net asset value of their Merging Fund Shares plus
the right to receive any dividends or distributions which were declared before
the Effective Time of the Reorganization but that remained unpaid at that time
with respect to the shares of the Merging Fund.
The Surviving Fund expects to maintain most of the portfolio
investments of the Merging Fund in light of the identical investment policies of
the Merging Fund and the Surviving Fund. Concurrently with the Reorganization,
the Surviving Fund will cease to operate under a "master/feeder" structure and
will instead invest directly in portfolio securities rather than in the Master
Portfolio.
After the Reorganization, all of the issued and outstanding shares of
the Merging Fund shall be canceled on the books of the Merging Fund and the
stock transfer books of the Merging Fund will be permanently closed.
The Reorganization is subject to a number of conditions, including
without limitation: approval of the Reorganization Plan and the transactions
contemplated thereby described in this Combined Prospectus/Proxy Statement by
the Merging Fund Shareholders; the receipt of a legal opinion from Simpson
Thacher & Bartlett with respect to certain tax issues, as more fully described
in "Federal Income Tax Consequences" below; and the parties' performance in all
material respects of their respective agreements and undertakings in the
Reorganization Plan. Assuming satisfaction of the conditions in the
Reorganization Plan, the Effective Time of the Reorganization will be on August
11, 2001 or such other date as is agreed to by the parties.
In addition, the consummation of the Reorganization is contingent upon
the consummation of the Feeder Reorganization.
The expenses of the Funds in connection with the Reorganization will be
borne by JPMC.
The Reorganization Plan and the Reorganization described herein may be
abandoned at any time prior to the Effective Time of the Reorganization by
either party if a material condition to the performance of such party under the
Reorganization Plan or a material covenant of the other party is not fulfilled
by the date specified in the Reorganization Plan or if there is a material
default or material breach of the Reorganization Plan by the other party. In
addition, either party may terminate the Reorganization Plan if its trustees
determine that proceeding with the Reorganization Plan is not in the best
interests of their Fund's shareholders.
BOARD CONSIDERATIONS
In 1993, the JPF Board and shareholders approved the restructuring of
the Funds into their current "master-feeder" format, pursuant to which the Funds
(the feeders) invested their
10
assets in a common Portfolio - the "master" - and shares of each Fund were sold
to different categories of investors with different distribution and shareholder
services and fees. Among other reasons for the 1993 restructuring was the
opportunity to obtain the economies of scale from an investment and expense
perspective that might come from the investment and administration of a larger
pool of assets than any one fund could expect to have on its own. An important
factor in the Board's decision at the time was that non-U.S. investors' assets
would be invested alongside those of U.S. investors within the master Portfolio
on a basis that was not disadvantageous to the non-U.S. investors from a U.S.
tax perspective. For various reasons, the non-U.S. feeders withdrew their assets
from the master commencing in 1997, thereby eliminating one of the principal
reasons for the master-feeder format. Nevertheless, the Funds continued in that
format and, the Board believes, conducted their operations on a basis at least
as favorable to the Funds as would have obtained if the format had been
abandoned, as is now proposed.
Following the announcement of the J.P. Morgan-Chase merger, JPMIM and
Morgan and their counterparts within the Chase organization reviewed the
compatibilities of their various mutual fund groups, including their respective
organizational structures, service providers, distribution arrangements and
methodologies, and fees and expenses. The proposed Reorganization of the Merging
Fund into the Surviving Fund is a part of the more general integration of the
J.P. Morgan funds complex with the Chase Vista funds complex to create a single
mutual fund complex with substantially similar arrangements for the provision of
advisory, administration, distribution, custody and fund accounting and transfer
agency services.
The JPF Board believes that the conversion by way of the proposed
Reorganization of the current master-feeder format into the multiclass format
discussed in this proxy statement and the adoption of the service arrangements
by the Surviving Fund described herein (the "Service Arrangements") are in the
best interests of the Surviving and Merging Funds and their respective
shareholders and that the interests of shareholders will not be diluted as a
result of the Reorganization.
In considering the proposed Reorganization and Service Arrangements,
the JPF Board also noted that there were important benefits expected to arise
out of the integration of the J.P. Morgan and Chase Vista mutual funds
complexes. Among these benefits, the Board considered (1) investor and
shareholder confusion should be mitigated if not eliminated by the adoption by
both the J.P. Morgan and the Chase Vista mutual funds of common organizational
structures and common service providers, (2) Surviving Fund shareholders would
be able to exchange into a
11
larger number and greater variety of funds without paying sales charges, (3)
additional share classes offered by the Surviving Fund should have a positive
effect on asset growth, which in turn over time could result in a lower total
expense ratio as economies of scale were realized; (4) JPMIM advised the Board
that it believes that the outsourcing of many functions to the subadministrator
will (a) upgrade the quality of services currently being provided to the Funds,
and (b) enhance Morgan's ability effectively to monitor and oversee the quality
of all Fund service providers, including the investment adviser, distributor,
custodian and transfer agent; (5) Morgan's undertaking for three years to waive
fees or reimburse the Surviving Fund's expenses in order that the total expense
ratios of the Select and Institutional Classes do not exceed those of the
Merging Fund and the Surviving Fund, respectively; (6) the fact that all costs
and expenses of the Reorganization and implementation of the Service
Arrangements would be borne by JPMC and (7) the fact that the Reorganization
would constitute a tax-free reorganization.
In addition, the Board took into account that, notwithstanding the
increase in the contract fee rate of Morgan, J.P. Morgan agreed to increase from
one to three years noted above its undertaking to cap the total expense ratio on
the Select and Institutional Classes and to institute a breakpoint in the
Administration fee from .15% of the average daily net assets in the aggregate of
all funds in the fully integrated funds group to .075% of such assets over [$25]
billion (the aggregate of such assets being [$19] billion as of March 31, 2001).
Moreover, JPMIM agreed that, notwithstanding its proposed increase to $1 million
of the minimum investment in the Select Class, all current shareholders of the
Merging Fund (for which the current minimum is $2,500) will be entitled to make
additional investments in the Select Class of the Surviving Fund or of any other
fund in the integrated fund complex or to exchange shares of the Select Class of
the Surviving Fund for Select Shares of any other such fund. The Board also
noted that J.P. Morgan did not propose and advised that it does not expect to
propose the imposition of any distribution (12b-1) fees or shareholder servicing
fees on the Select or Institutional Class that are not already in place. Finally
the Board was advised that the custody and fund accounting fees to be charged by
Chase Global Investors Services will be lower than those currently charged by
The Bank of New York. It should be recognized that, at current asset levels and
in consequence of the expense cap, the lower custody and fund accounting fees
will not have an immediate effect on the Surviving Fund's total expense ratio
but should have some positive effect in the future.
Based upon their evaluation of the relevant information provided to
them, the changes effected in the Service Arrangements in the negotiations
between the Trustees and J.P. Morgan, and in light of their fiduciary duties
under federal and state law, the Trustees, including a majority who are not
interested persons of the Funds or JPMC as defined in the 1940 Act, determined
that the proposed Reorganization is in the best interests of both the Merging
and Surviving Fund, that the interests of the shareholders of each of the
Merging Fund and the Surviving Fund would not be diluted as a result of the
Reorganization, and that the Service Arrangements are in the best interests of
the Surviving Fund.
THE JPMF BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE PROPOSAL.
12
The JPMF Board has not determined what action the Merging Fund will
take in the event shareholders do not approve the Reorganization Plan or for any
reason the Reorganization is not consummated. In either such event, the Board
will consider other appropriate courses of action.
INFORMATION RELATING TO THE CONCURRENT REORGANIZATIONS
The terms and conditions under which the Concurrent Reorganizations may
be consummated are set forth in reorganization plans which are substantially
similar to the Reorganization Plan you are in considering. Concurrently with the
Reorganization and Feeder Reorganization, the Surviving Fund will cease to
operate under a "master/feeder" structure and will instead invest directly in
portfolio securities rather than in the Master Portfolio. The consummation of
the Chase Fund Reorganization is contingent upon the consummation of the
Reorganization and the Feeder Reorganization.
FEDERAL INCOME TAX CONSEQUENCES
Consummation of the Reorganization is subject to the condition that
JPMF receive an opinion from Simpson Thacher & Bartlett to the effect that for
federal income tax purposes: (i) the transfer of all of the assets and
liabilities of the Merging Fund to the Surviving Fund in exchange for the Class
A Shares and the liquidating distributions to shareholders of the Class A Shares
so received, as described in the Reorganization Plan, will constitute a
reorganization within the meaning of Section 368(a) of the Internal Revenue Code
of 1986, as amended (the "Code"), and with respect to the Reorganization, the
Merging Fund and the Surviving Fund will each be considered "a party to a
reorganization" within the meaning of Section 368(b) of the Code; (ii) no gain
or loss will be recognized by the Merging Fund as a result of such transaction;
(iii) no gain or loss will be recognized by the Surviving Fund as a result of
such transaction; (iv) no gain or loss will be recognized by the Merging Fund
Shareholders on the distribution to the Merging Fund Shareholders of the Class A
Shares solely in exchange for their Merging Fund Shares; (v) the aggregate basis
of shares of the Surviving Fund received by a shareholder of the Merging Fund
will be the same as the aggregate basis of such Merging Fund Shareholder's
Merging Fund Shares immediately prior to the Reorganization; (vi) the basis of
the Surviving Fund in the assets of the Merging Fund received pursuant to such
transaction will be the same as the basis of such assets in the hands of the
Merging Fund immediately before such transaction; (vii) a Merging Fund
Shareholder's holding period for the Class A Shares will be determined by
including the period for which such Merging Fund Shareholder held the Merging
Fund Shares exchanged therefor, provided that the Merging Fund Shareholder held
such Merging Fund Shares as a capital asset; and (viii) the Surviving Fund's
holding period with respect to the assets received in the Reorganization will
include the period for which such assets were held by the Merging Fund.
The Master Portfolio currently has an aggregate basis in its assets
that is higher than the aggregate basis of all of the partnership interests
in the Master Portfolio. Upon consummation of the Reorganization, the
Surviving Fund will have an aggregate basis in its assets equal to the
aggregate basis of the partnership interests in the Master Portfolio held by
the Merging Fund and the Surviving Fund immediately prior to the
Reorganization rather than the higher aggregate basis that such assets had in
the hands of the Master Portfolio. Thus, the benefit of such higher basis
will be lost upon consummation of the Reorganization.
JPMF has not sought a tax ruling from the Internal Revenue Service (the
"IRS"), but is acting in reliance upon the opinion of counsel discussed in the
previous paragraph. That opinion is not binding on the IRS and does not preclude
the IRS from adopting a contrary position. Shareholders should consult their own
advisers concerning the potential tax consequences to them, including state and
local income taxes.
13
CAPITALIZATION
Because the Merging Fund will be combined with the Surviving Fund in
the Reorganization as well as the Feeder Advisor Portfolio as a result of the
Concurrent Reorganizations, the total capitalization of the Surviving Fund after
the Reorganization and the Concurrent Reorganizations is expected to be greater
than the current capitalization of the Merging Fund. The following tables sets
forth as of November 30, 2000: (i) the capitalization of the Merging Fund; (ii)
the capitalization of the Surviving Fund and (iii) the pro forma capitalization
of the Surviving Fund as adjusted to give effect to the Concurrent
Reorganizations. There is, of course, no assurance that the Reorganization and
the Concurrent Reorganizations will be consummated. Moreover, if consummated,
the capitalizations of the Surviving Fund and the Merging Fund are likely to be
different at the Effective Time of the Reorganization as a result of
fluctuations in the value of portfolio securities of each Fund and daily share
purchase and redemption activity in each Fund. The Surviving Fund currently has
one class of shares. In connection with the Reorganization, this class will be
renamed Institutional Class and the Class A share class, Class B share class,
Class C share class, and the Select share class will be introduced.
CAPITALIZATION
PRO FORMA WITH CONCURRENT REORGANIZATION
BENEFICIAL NET ASSET
INTEREST SHARES VALUE PER
OUTSTANDING OUTSTANDING NET ASSETS SHARE
----------- ------------- ---------- ---------------
J.P MORGAN FUNDS
J.P. Morgan U.S. Equity Fund --
Advisor Series (the Merging Fund) 53,157 - 475,351 8.94
J.P. Morgan U.S. Equity Fund 16,611,076 - 343,997,623 20.71
J.P. Morgan Institutional U.S.
Equity Fund (the Surviving Fund) 15,051,872 - 183,470,628 12.19
JPMORGAN LARGE CAP EQUITY FUND
Class A - 3,980,818 60,636,740 15.23
Class B - 1,780,660 26,905,354 15.11
Class C - 124,782 1,876,100 15.04
Institutional - 7,076,121 108,285,188 15.30
PRO FORMA COMBINED WITH CONCURRENT
REORGANIZATION
Class A - 5,013,616 61,112,083 12.19
Class B - 2,207,306 26,905,349 12.19
Class C - 153,915 1,876,106 12.19
Select - 37,105,139 452,282,818 12.19
Institutional - 15,051,872 183,470,628 12.19
(1) Formerly, Chase Vista Large Cap Equity Fund
PURCHASES, REDEMPTIONS AND EXCHANGES
Following the Reorganization, the procedures for purchases, redemptions
and exchanges of shares of the Surviving Fund will be substantially similar to
those of the Merging Fund. The Surviving Fund currently has one class of shares.
In connection with the Reorganization and the Concurrent Reorganizations, this
class will be renamed "Institutional Class" and the Class A share class, Class B
share class, Class C share class and Select Class share class will be
introduced. The following discussion reflects the new class structure. This
section is qualified
14
in its entirety by the discussion in the Prospectus and Statement of Additional
Information of the Surviving Fund, which are incorporated herein by reference.
12b-1 FEES
JFD is the distributor for the Surviving Fund. The Surviving Fund will
adopt a Rule 12b-1 distribution plan for Class A Shares under which it will pay
annual distribution fees of up to 0.25% of the average daily net assets
attributable to Class A Shares. A similar 12b-1 distribution plan (with annual
distribution fees of up to 0.25%) is currently in effect for shares of the
Merging Fund.
This payment covers such things as compensation for services provided
by broker-dealers and expenses connected with the sale of shares. Payments are
not tied to actual expenses incurred.
Because 12b-1 expenses are paid out of the Surviving Fund's assets on
an ongoing basis, over time these fees will increase the cost of a shareholder's
investment and may cost more than other types of sales charges used by other
mutual funds.
There is no Rule 12b-1 distribution plan for the Select Class Shares or
the Institutional Class Shares of the Surviving Fund.
BUYING SURVIVING FUND SHARES
THE FOLLOWING DISCUSSION APPLIES TO PURCHASES OF THE CLASS A SHARES
THAT YOU MIGHT MAKE AFTER THE REORGANIZATION AND REFLECTS THE NEW CLASS
STRUCTURE.
The price shareholders pay for their shares is the net asset value
per share (NAV), plus any applicable sales charge. However, shareholders who
receive Class A Shares as a result of the Reorganization will not be required
to pay a sales charge on future purchases of Class A Shares of the Surviving
Fund future purchases of Class A shares of other JPMorgan Funds or exchanges
into Class A shares of other JPMorgan Funds. NAV is the value of everything
the Surviving Fund owns, minus everything it owes, divided by the number of
shares held by investors. The Surviving Fund generally values its assets at
fair market values but may use fair value if market prices are unavailable.
The NAV of each class of the Surviving Fund's shares is generally
calculated once each day at the close of regular trading on the New York Stock
Exchange. A shareholder will pay the next NAV calculated after the JPMorgan
Funds Service Center (the "Center") receives that shareholder's order in proper
form. An order is in proper form only after payment is converted into federal
funds.
The Center accepts purchase orders on any business day that the New
York Stock Exchange is open. If an order is received in proper form by the close
of regular trading on the New York Stock Exchange, it will be processed at that
day's price and the purchaser will be entitled to all dividends declared on that
day. If an order is received after the close of regular trading on the New York
Stock Exchange, it will generally be processed at the next day's price. If a
purchaser pays by check for Surviving Fund shares before the close of regular
trading on the
15
New York Stock Exchange, it will generally be processed the next day the
Surviving Fund is open for business.
If a shareholder buys through an agent and not directly from the
Center, the agent could set earlier cut-off times. Each shareholder must provide
a Social Security Number or Taxpayer Identification Number when opening an
account.
The Surviving Fund has the right to reject any purchase order for any
reason.
Class A Shares of the Surviving Fund generally may be purchased only
through financial service firms, such as broker-dealers and banks that have an
agreement with the Fund or the Fund's distributor.
For Class A Shares, checks should be made out to JPMorgan Funds in U.S.
dollars. Credit cards, cash, or checks from a third party will not be accepted.
Shares bought by check may not be sold for 15 calendar days. Shares bought
through an automated clearing house cannot be sold until the payment clears.
This could take more than seven business days. Purchase orders will be canceled
if a check does not clear and the investor will be responsible for any expenses
and losses to the Fund. Orders by wire will be canceled if the Center does not
receive payment by 4:00 p.m., Eastern time, on the day the shareholder buys.
Shareholders seeking to buy Class A Shares through an investment
representative should instruct their representative to contact the Surviving
Fund. Such representatives may charge investors a fee and may offer additional
services, such as special purchase and redemption programs, "sweep" programs,
cash advances and redemption checks. Such representative may set different
minimum investments and earlier cut-off times.
A systematic investment plan is available for Class A Shares.
SELLING SURVIVING FUND SHARES
THE FOLLOWING DISCUSSION APPLIES TO SALES OF THE CLASS A SHARES THAT
YOU MIGHT MAKE AFTER THE REORGANIZATION AND REFLECTS THE NEW CLASS STRUCTURE.
Class A Shares of the Surviving Fund may be sold on any day the Center
is open for trading, either directly to the Fund or through an investment
representative. Shareholders of the Surviving Fund will receive the next NAV
calculated after the Center accepts his or her sale order less any applicable
deferred sales charge.
Under normal circumstances, if a request is received before the close
of regular trading on the New York Stock Exchange, the Surviving Fund will send
the proceeds the next business day. An order to sell shares will not be accepted
if the Surviving Fund has not collected payment for the shares. The Surviving
Fund may stop accepting orders to sell and may postpone payments for more than
seven days, as federal securities laws permit.
Generally, proceeds are sent by check, electronic transfer or wire for
Class A shares. However, if a shareholder's address of record has changed within
the 30 days prior to the sale
16
request or if more than $25,000 of shares is sold by phone, proceeds will be
sent by electronic transfer or wire only to the bank account on the Surviving
Fund's records.
For Class A Shares, a shareholder will need to have his or her
signature guaranteed if he or she wants payment to be sent to an address other
than the one in the Surviving Fund's records. Additional documents or a letter
from a surviving joint owner may also be needed.
A shareholder who purchased through an investment representative, or
through a financial service firm, should contact that representative, who will
send the necessary documents to the Center. The representative might charge a
fee for this service.
Shareholders may also sell their shares by contacting the Center
directly. Class A shareholders may call 1-800-_______.
A systematic withdrawal plan is available for Class A Shares.
EXCHANGING SURVIVING FUND SHARES
THE FOLLOWING DISCUSSION APPLIES TO EXCHANGES OF THE CLASS A SHARES
THAT YOU MIGHT MAKE AFTER THE REORGANIZATION.
Class A Shares of the Surviving Fund may be exchanged for shares of the
same class in certain other JPMorgan Funds.
For tax purposes, an exchange is treated as a sale of those shares.
Shareholders should carefully read the prospectus of the fund into which they
want to exchange. Shareholders who exchange must meet any minimum investment
requirements and may have to pay a sales commission.
The exchange privilege is not a means of short-term trading as this
could increase management cost and affect all shareholders of the Surviving
Fund. The Fund reserves the right to limit the number of exchanges or refuse an
exchange. Each exchange privilege may also be terminated. The Surviving Fund
charges an administration fee of $5 for each exchange if an investor makes more
than 10 exchanges in a year or three in a quarter.
OTHER INFORMATION CONCERNING THE SURVIVING FUND
For Class A Shares, the Surviving Fund may close an account if the
balance falls below $500. The Surviving Fund may also close the account if an
investor is in the systematic investment plan and fails to meet investment
minimums over a 12-month period. At least 60 days' notice will be given before
closing the account.
Unless a shareholder indicates otherwise on his or her account
application, the Surviving Fund is authorized to act on redemption and transfer
instructions received by phone. If someone trades on an account by phone, the
Surviving Fund will ask that person to confirm the account registration and
address to make sure they match those in the Fund records. If they do
correspond, the Surviving Fund is generally authorized to follow that person's
instructions. The Surviving Fund will take all reasonable precautions to confirm
that the instructions are genuine.
17
Investors agree that they will not hold the Surviving Fund liable for any loss
or expenses from any sales request, if the Fund takes reasonable precautions.
The Surviving Fund will be liable for any losses to a shareholder from an
unauthorized sale or fraud against such shareholder if the Surviving Fund does
not follow reasonable procedures.
It may not always be possible to reach the Center by telephone. This
may be true at times of unusual market changes and shareholder activity. In that
event, shareholders can mail instructions to the Surviving Fund or contact their
investment representative or agent. The Fund may modify or cancel the sale of
shares by phone without notice.
JPMF, on behalf of the Surviving Fund, has entered into agreements with
certain shareholder servicing agents (including Chase) under which the
shareholder servicing agents will agree to provide certain support services to
their customers. For performing these services, each shareholder servicing agent
will receive an annual fee of up to 0.25% of the average daily net assets of the
Class A Shares held by investors serviced by the shareholder servicing agent.
The Merging Fund likewise has similar arrangements with respect to its Shares.
JPMIM and/or JFD may, at their own expense, make additional payments to
certain selected dealers or other shareholder servicing agents for performing
administrative services for their customers.
The Surviving Fund will issue multiple classes of shares. Each class
may have different requirements for who may invest, and may have different sales
charges and expense levels. A person who gets compensated for selling Class A
Shares may receive a different amount for each class.
DISTRIBUTIONS AND TAXES
The Surviving Fund can earn income and realize capital gain. The
Surviving Fund will deduct from these earnings any expenses and then pay to
shareholders the distributions.
The Surviving Fund typically distributes any net investment income at
least monthly. Net capital gain, if any, is distributed annually. You have three
options for your Surviving Fund distributions. You may:
- reinvest all of them in additional Surviving Fund shares without
a sales charge;
- take distributions of net investment income in cash or as a
deposit in a pre-assigned bank account and reinvest distributions
of net capital gain in additional shares; or
- take all distributions in cash or as a deposit in a pre-assigned
bank account.
If you don't notify us otherwise, we'll reinvest all distributions. If
your distributions are reinvested, they will be in the form of shares of the
same class. The taxation of dividends won't be affected by the form in which you
receive them.
Dividends of net investment income are usually taxable as ordinary
income at the federal, state and local levels.
18
If you receive distributions of net capital gain, the tax rate will be
based on how long the Surviving Fund held a particular asset, not on how long
you have owned your shares. If you buy shares just before a distribution, you
will pay tax on the entire amount of the taxable distribution you receive, even
though the NAV will be higher on that date because it includes the distribution
amount.
Early in each calendar year, the Surviving Fund will send its
shareholders a notice showing the amount of distributions received in the
preceding year and the tax status of those distributions.
The above is only a general summary of tax implications of investing in
the Surviving Fund. Shareholders should consult their tax advisors to see how
investing in the Surviving Fund will affect their own tax situation.
COMPARISON OF THE MERGING FUND'S
AND THE SURVIVING FUND'S
ORGANIZATION STRUCTURE
There are no material differences in the organizational structure of
the Merging Fund and the Surviving Fund. Set forth below are descriptions of the
structure, voting rights, shareholder liability and the liability of Trustees.
STRUCTURE OF THE MERGING FUND AND THE SURVIVING FUND
Each of the Merging Fund and the Surviving Fund is organized as a
series of JPMF, which is organized under the law of the Commonwealth of
Massachusetts. As a Massachusetts business trust, JPMF's operations are governed
by JPMF's Declaration of Trust and By-Laws and applicable Massachusetts law. The
operations of the Merging Fund are also subject to the provisions of the 1940
Act and the rules and regulations thereunder.
TRUSTEES AND OFFICERS
Subject to the provisions of its trust documents, the business of the
Merging Fund and the Surviving Fund is managed by JPMF's Trustees, who serve
indefinite terms and have all powers necessary or convenient to carry out their
responsibilities.
Information concerning the current Trustees and officers of JPMF is set
forth in the Funds' respective Statements of Additional Information, which are
incorporated herein by reference.
SHARES OF FUNDS
JPMF is a trust with an unlimited number of authorized shares of
beneficial interest which may be divided into series or classes thereof. Each
Fund is one series of a trust and may issue multiple classes of shares. Each
share of a series or class of a trust represents an equal proportionate interest
in that series or class with each other share of that series or class. The
shares of each series or class of JPMF participate equally in the earnings,
dividends and assets of the particular series or class. Fractional shares have
proportionate rights to full shares. Expenses
19
of JPMF that are not attributable to a specific series or class will be
allocated to all the series of that trust in a manner believed by its board to
be fair and equitable. Generally, shares of each series will be voted
separately, for example, to approve an investment advisory agreement. Likewise,
shares of each class of each series will be voted separately, for example, to
approve a distribution plan, but shares of all series and classes vote together,
to the extent required by the 1940 Act, including for the election of Trustees.
JPMF is not required to hold regular annual meetings of shareholders, but may
hold special meetings from time to time. There are no conversion or preemptive
rights in connection with shares of JPMF.
SHAREHOLDER VOTING RIGHTS
A vacancy in the Board of JPMF resulting from the resignation of a
Trustee or otherwise may be filled similarly by a vote of a majority of the
remaining Trustees then in office, subject to the 1940 Act. In addition,
Trustees may be removed from office by a vote of holders of shares representing
two-thirds of the outstanding shares of each portfolio of that trust. A meeting
of shareholders shall be held upon the written request of the holders of shares
representing not less than 10% of the outstanding shares entitled to vote on the
matters specified in the written request. Except as set forth above, the
Trustees may continue to hold office and may appoint successor Trustees.
SHAREHOLDER LIABILITY
Under Massachusetts law, shareholders of JPMF could, under certain
circumstances, be held personally liable as partners for the obligations of that
trust. However, the Declaration of Trust of JPMF disclaims shareholder liability
for acts or obligations of that trust and provides for indemnification and
reimbursement of expenses out of trust property for any shareholder held
personally liable for the obligations of that trust. JPMF may maintain
appropriate insurance (for example, fidelity bonding and errors and omissions
insurance) for the protection of that trust, its shareholders, Trustees,
officers, employees and agents covering possible tort and other liabilities.
Thus, the risk of a shareholder incurring financial loss on account of
shareholder liability generally is limited to circumstances in which both
inadequate insurance existed and the trust itself was unable to meet its
obligations.
LIABILITY OF DIRECTORS AND TRUSTEES
Under the Declaration of Trust of JPMF, the Trustees of that trust are
personally liable only for bad faith, willful misfeasance, gross negligence or
reckless disregard of their duties as Trustees. Under the Declaration of Trust
of JPMF, a Trustee or officer will generally be indemnified against all
liability and against all expenses reasonably incurred or paid by such person in
connection with any claim, action, suit or proceeding in which such person
becomes involved as a party or otherwise by virtue of such person being or
having been a Trustee or officer and against amounts paid or incurred by such
person in the settlement thereof.
The foregoing is only a summary of certain organizational and governing
documents and Massachusetts business trust law. It is not a complete
description. Shareholders should refer to the provisions of these documents and
state law directly for a more thorough comparison. Copies
20
of the Declaration of Trust and By-Laws of JPMF are available without charge
upon written request to that trust.
INFORMATION RELATING TO THE ADVISORY CONTRACTS AND OTHER SERVICES
GENERAL INFORMATION
As noted above, the assets of the Surviving Fund currently invested in
the Master Portfolio are managed by JPMIM pursuant to an Advisory Agreement
between JPMIM and the Master Portfolio, and JPMIM is responsible for the
day-to-day management of the Surviving Fund's assets. Following the
Reorganization and the Concurrent Reorganizations, the Surviving Fund's assets
will be managed directly by JPMIM pursuant to an Advisory Agreement
substantially similar to the agreement between the Master Portfolio and JPMIM.
DESCRIPTION OF JPMIM
JPMIM is an indirect wholly-owned subsidiary of JPMC incorporated under
the laws of Delaware. JPMIM's principal executive offices are located at 522
Fifth Avenue, New York, New York 10036. JPMIM, a registered investment advisor,
manages employee benefit funds of corporations, labor unions and state and local
governments and the accounts of other institutional investors, including
investment companies. As of _______ __, 2001, JPMIM and certain of its
affiliates provided investment management services with respect to assets of
approximately $___ billion.
Under the Advisory Agreement, JPMIM will be responsible for making
decisions with respect to, and placing orders for, all purchases and sales of
the portfolio securities of the Surviving Fund. JPMIM's responsibilities under
the Advisory Agreement will include supervising the Surviving Fund's investments
and maintaining a continuous investment program, placing purchase and sale
orders and paying costs of certain clerical and administrative services involved
in managing and servicing the Surviving Fund's investments and complying with
regulatory reporting requirements. The services to be provided to the Surviving
Fund by JPMIM are substantially similar to the services currently provided to
the Master Portfolio and, therefore, indirectly to the Merging Fund by JPMIM.
EXPENSES AND MANAGEMENT FEES. The Advisory Agreement provides that the
Surviving Fund will pay JPMIM a monthly management fee based upon the net assets
of the Surviving Fund. The annual rate of this management fee is 0.40%. The
Master Portfolio and, therefore, indirectly the Merging Fund also currently pay
0.40% of average net assets to JPMIM for its advisory services. JPMIM may waive
fees from time to time.
Under the Advisory Agreement, except as indicated above, the Surviving
Fund is responsible for its operating expenses including, but not limited to,
taxes; interest; fees (including fees paid to its Trustees who are not
affiliated with JPMIM or any of its affiliates); fees payable to the Commission;
state securities qualification fees; association membership dues; costs of
preparing and printing prospectuses for regulatory purposes and for distribution
to existing shareholders; management and administrative fees; charges of the
custodian and transfer agent; insurance premiums; auditing and legal expenses;
costs of shareholders' reports and
21
shareholder meetings; any extraordinary expenses; and brokerage fees and
commissions, if any, in connection with the purchase or sale of portfolio
securities.
LIMITATION ON LIABILITY. The Advisory Agreement provides that JPMIM
will not be liable for any error of judgment or mistake of law or for any act or
omission or loss suffered by JPMF or the Surviving Fund in connection with the
performance of the Advisory Agreement except a loss resulting from a breach of
fiduciary duty with respect to the receipt of compensation for services or from
willful misfeasance, bad faith, or gross negligence in the performance of its
duties or reckless disregard of its obligations and duties under the Advisory
Agreement.
DURATION AND TERMINATION. The Advisory Agreement will continue in
effect from year to year with respect to the Surviving Fund, only so long as
such continuation is approved at least annually by (i) the Board of Trustees of
JPMF or the majority vote of the outstanding voting securities of the Surviving
Fund, and (ii) a majority of those Trustees who are neither parties to the
Advisory Agreement nor "interested persons," as defined in the 1940 Act, of any
such party, acting in person at a meeting called for the purpose of voting on
such approval. The Advisory Agreement will terminate automatically in the event
of its "assignment," as defined in the 1940 Act. In addition, the Advisory
Agreement is terminable at any time as to the Surviving Fund without penalty by
the JPMF Board or by vote of the majority of the Surviving Fund's outstanding
voting securities upon 60 days' written notice to JPMIM, and by JPMIM on 90
days' written notice to JPMF.
PORTFOLIO MANAGER
The portfolio management team for the Surviving Fund is comprised of 23
research analysts, who select stocks in their respective sectors. Henry D.
Cavanna, managing director, and Bradford L. Frishberg, vice president, oversee
the portfolio and manage its cash flows. Mr. Cavanna joined the team in February
of 1998, and has been at JPMIM since 1971. He served as manager of U.S. equity
portfolios prior to managing the fund. Mr. Frishberg has been at JPMIM since
1996 and is a portfolio manager in the equity and balanced groups. Prior to
joining J.P. Morgan, he managed portfolios for Aetna Investment Management in
Hong Kong.
PORTFOLIO TRANSACTIONS AND BROKERAGE COMMISSIONS
JPMIM places orders for the Surviving Fund for all purchases and sales
of portfolio securities, enters into repurchase agreements, and may enter into
reverse repurchase agreements and execute loans of portfolio securities on
behalf of the Surviving Fund. Fixed income and debt securities and municipal
bonds and notes are generally traded at a net price with dealers acting as
principal for their own accounts without a stated commission. The price of the
security usually includes profit to the dealers. In underwritten offerings,
securities are purchased at a fixed price which includes an amount of
compensation to the underwriter, generally referred to as the underwriter's
concession or discount. On occasion, certain securities may be purchased
directly from an issuer, in which case no commissions or discounts are paid.
Portfolio transactions for the Surviving Fund will be undertaken
principally to accomplish the Surviving Fund's objective in relation to expected
movements in the general
22
level of interest rates. The Surviving Fund may engage in short-term trading
consistent with its objectives.
In connection with portfolio transactions, JPMIM intends to seek best
execution on a competitive basis for both purchases and sales of securities.
Subject to the overriding objective of obtaining the best execution of orders,
JPMIM may allocate a portion of the Surviving Fund's brokerage transactions to
affiliates of JPMIM. Under the 1940 Act, persons affiliated with the Surviving
Fund and persons who are affiliated with such persons are prohibited from
dealing with the fund as principal in the purchase and sale of securities unless
a permissive order allowing such transactions is obtained from the Commission.
However, affiliated persons of the fund may serve as its broker in listed or
over-the-counter transactions conducted on an agency basis provided that, among
other things, the fee or commission received by such affiliated broker is
reasonable and fair compared to the fee or commission received by non-affiliated
brokers in connection with comparable transactions. In addition, the Surviving
Fund may not purchase securities during the existence of any underwriting
syndicate for such securities of which JPMIM or an affiliate is a member or in a
private placement in which JPMIM or an affiliate serves as placement agent
except pursuant to procedures adopted by the Board of Trustees that either
comply with rules adopted by the Commission or with interpretations of the
Commission's staff.
Investment decisions made by JPMIM are the product of many factors in
addition to basic suitability for the particular fund or other client in
question. Thus, a particular security may be bought or sold for certain clients
even though it could have been bought or sold for other clients at the same
time. Likewise, a particular security may be bought for one or more clients when
one or more other clients are selling the same security. The Surviving Fund may
only sell a security to other portfolios or accounts managed by JPMIM or its
affiliates in accordance with procedures adopted by the Trustees.
It also sometimes happens that two or more clients simultaneously
purchase or sell the same security. On those occasions when JPMIM deems the
purchase or sale of a security to be in the best interests of the Surviving
Fund, as well as other clients including other funds, JPMIM, to the extent
permitted by applicable laws and regulations, may, but is not obligated to,
aggregate the securities to be sold or purchased for the Surviving Fund with
those to be sold or purchased for other clients in order to obtain best
execution, including lower brokerage commissions if appropriate. In such event,
allocation of the securities so purchased or sold as well as any expenses
incurred in the transaction will be made by JPMIM in the manner it considers to
be most equitable and consistent with JPMIM's fiduciary obligations to the
Surviving Fund. In some instances, this procedure might adversely affect the
Surviving Fund.
OTHER SERVICES
JFD, a wholly owned, indirect subsidiary of BISYS Fund Services, Inc.,
which currently serves as the Merging Fund's distributor and sub-administrator,
is the distributor and sub-administrator for the Surviving Fund. JFD is
unaffiliated with JPMC or any of its subsidiaries.
Morgan serves as administrator and shareholder servicing agent, BONY
serves as fund accountant and custodian, and DST serves as transfer agent and
dividend disbursing agent for the Surviving Fund. The services provided by
Morgan and BONY include day-to-day maintenance
In connection with the Reorganization, the administration fee paid
to Morgan will increase to 0.15% of average daily net assets on the first $26
billion of complex wide non-money market assets and 0.075% on complex wide
non-money market assets in excess of $26 billion.
23
of certain books and records, calculation of the offering price of the shares
and preparation of reports. In its role as custodian, BONY will be responsible
for the daily safekeeping of securities and cash held by the Surviving Fund. It
is anticipated that prior to the consummation of the Reorganization, Chase will
become the Surviving Fund's fund accountant and custodian.
PROPOSAL 2: ELECTION OF TRUSTEES
It is proposed that shareholders of the Merging Fund consider the
election of the individuals listed below (the "Nominees") to the Board of
Trustees of JPMF, which is currently organized as a Massachusetts business
trust. All shareholders of any series of JPMF as of the record date (April 16,
2001) are required to be given a vote on the proposal regarding Trustees.
Because as of the record date you are a shareholder in JPMF, you are entitled to
vote on this proposal.
In connection with the merger of J.P. Morgan & Co. Incorporated and The
Chase Manhattan Corporation, it has been proposed, subject to shareholder
approval, that the Boards of Trustees of the investment companies managed by
JPMIM and their affiliates be rationalized in order to obtain additional
operating efficiencies by having the same Board of Trustees for all of the
funds. Therefore, the Nominees include certain current Trustees of JPMF and
certain current Trustees of JPMF (including certain members of their respective
Advisory Boards). Each Nominee has consented to being named in this Proxy
Statement and has agreed to serve as a Trustee if elected.
Shareholders of JPMF are concurrently considering the election of the
same individuals to the Board of Trustees of JPMF. Biographical information
about the Nominees and other relevant information is set forth below. More
information regarding the current Trustees of JPMF is contained in either of the
Fund's Statements of Additional Information, which are incorporated herein by
reference.
The persons named in the accompanying form of proxy intend to vote each
such proxy "FOR" the election of the Nominees, unless shareholders specifically
indicate on their proxies the desire to withhold authority to vote for elections
to office. It is not contemplated that any Nominee will be unable to serve as a
Board member for any reason, but if that should occur prior to the Meeting, the
proxy holders reserve the right to substitute another person or persons of their
choice as nominee or nominees.
THE JPMF BOARD HAS UNANIMOUSLY RECOMMENDED THAT SHAREHOLDERS VOTE "FOR" EACH OF
THE NOMINEES LISTED BELOW.
VOTE REQUIRED
The election of each of the Nominees listed below requires the
affirmative vote of a majority of all the votes entitled to be cast at the
Meeting by all shareholders of JPMF.
The following are the nominees:
------------------- ------------------
24
The Board of Trustees of JPMF met four times during the fiscal year
ended May 31, 2000, and each of the Trustees attended at least 75% of the
meetings.
The Board of Trustees of JPMF presently has an Audit Committee. The
members of the Audit Committee are Messrs. Addy (Chairman), Eschenlauer,
Burns, Mallardi and Healey. The function of the Audit Committee is to
recommend independent auditors and monitor accounting and financial matters.
The Audit Committee met four times during the fiscal year ended May 31, 2000.
* Interested Trustee, as defined by the 1940 Act.
REMUNERATION OF TRUSTEES AND CERTAIN EXECUTIVE OFFICERS:
Each Trustee is reimbursed for expenses incurred in attending each
meeting of the Board of Trustees or any committee thereof. Each Trustee who is
not an affiliate of JPMIM is compensated for his or her services according to a
fee schedule which recognizes the fact that each Trustee also serves as a
Trustee of other investment companies advised by JPMIM. Each Trustee receives a
fee, allocated among all investment companies for which the Trustees serves.
Annually, each Trustee receives $75,000.
Set forth below is information regarding compensation paid or accrued
during the calendar year ended December 31, 2000 for each Trustee of JPMF:
Total Trustee
Aggregate Trustee Compensation Accrued
Compensation Paid by by Fund Complex(1)
the Trust During 2000 During 2000(2)
--------------------- --------------------
Matthew Healey, Trustee(3), Chairman and Chief Executive
Officer $23,538 $75,000
Frederick S. Addy, Trustee $23,538 $75,000
William G. Burns, Trustee $23,538 $75,000
Arthur C. Eschenlauer, Trustee $23,538 $75,000
Michael P. Mallardi, Trustee $23,538 $75,000
- ------------------------
(1) A Fund Complex means two or more investment companies that hold themselves
out to investors as related companies for purposes of investment and
investment services, or have a common investment adviser or have an
investment adviser that is an affiliated person of the investment adviser
of any of the other investment companies.
(2) No investment company within the Fund Complex has a pension or retirement
plan.
(3) During 2000, Pierpont Group, Inc. paid Mr. Healey, in his role as Chairman
of Pierpont Group, Inc., compensation in the amount of $200,000,
contributed $25,500 to a defined contribution plan on his behalf and paid
$18,400 in insurance premiums for his benefit.
The Trustees decide upon general policies and are responsible for
overseeing JPMF's business affairs. Each of JPMF and the Master Portfolio has
entered into a Fund Services Agreement with Pierpont Group, Inc. to assist the
Trustees in exercising their overall supervisory responsibilities. Pierpont
Group, Inc. was organized in July 1989 to provide services for the J.P.
25
Morgan Family of Funds (formerly "The Pierpont Family of Funds"), and the
Trustees are the equal and sole shareholders of Pierpont Group, Inc. JPMF has
agreed to pay Pierpont Group, Inc. a fee in an amount representing its
reasonable costs in performing these services. These costs are periodically
reviewed by the Trustees. The principal offices of Pierpont Group, Inc. are
located at 461 Fifth Avenue, New York, New York 10017. It is anticipated that
the Fund will terminate its agreement with Pierpont Group, Inc. in connection
with the Reorganization.
The aggregate fees paid to Pierpont Group, Inc. by the Merging Fund,
the Surviving Fund and the Master Portfolio during the indicated fiscal periods
are set forth below:
MERGING FUND--For the fiscal years ended May 31, 1998, 1999 and 2000: $______,
$______ and $_____, respectively.
SURVIVING FUND -- For the fiscal years ended May 31, 1998, 1999 and 2000:
$12,419, $7,659 and $4,651, respectively.
MASTER PORTFOLIO --For the fiscal years ended May 31, 1998, 1999 and 2000:
$30,613, $18,019 and $12,016, respectively.
ADVISORY BOARD
The Trustees determined as of January 26, 2000 to establish an advisory
board and appoint four members ("Members of the Advisory Board") thereto. Each
member serves at the pleasure of the Trustees. The advisory board is distinct
from the Trustees and provides advice to the Trustees as to investment,
management and operations of JPMF; but has no power to vote upon any matter put
to a vote of the Trustees. The advisory board and the members thereof also serve
each of the other trusts in the Fund Complex. The creation of the Advisory Board
and the appointment of the members thereof was designed so that the Board of
Trustees will continuously consist of persons able to assume the duties of
Trustees and be fully familiar with the business and affairs of JPMF, in
anticipation of the current Trustees reaching the mandatory retirement age of
seventy. Each Member of the Advisory Board is paid an annual fee of $75,000 for
serving in this capacity for the Fund Complex and is reimbursed for expenses
incurred in connection for such service. The Members of the Advisory Board may
hold various other directorships unrelated to these funds. The mailing address
of the Members of the Advisory Board is c/o Pierpont Group, Inc., 461 Fifth
Avenue, New York, New York 10017. Their names, principal occupations during the
past five years and dates of birth are set forth below:
Ann Maynard Gray -- President, Diversified Publishing Group and Vice
President, Capital Cities/ABC, Inc. Her date of birth is August 22, 1945.
John R. Laird-- Retired; Former Chief Executive Officer, Shearson
Lehman Brothers and The Boston Company. His date of birth is June 21, 1942.
Gerard P. Lynch -- Retired; Former Managing Director, Morgan Stanley
Group and President and Chief Operating Officer, Morgan Stanley Services, Inc.
His date of birth is October 5, 1936.
26
James J. Schonbachler -- Retired; Prior to September, 1998, Managing
Director, Bankers Trust Company and Chief Executive Officer and Director,
Bankers Trust A.G., Zurich and BT Brokerage Corp. His date of birth is January
26, 1943.
PRINCIPAL EXECUTIVE OFFICERS:
The principal executive officers of JPMF are as follows:
NAME AND POSITION AGE PRINCIPAL OCCUPATION AND OTHER INFORMATION
- ----------------- -------- ----------------------------------------------
Matthew Healey 63 Chief Executive Officer; Chairman, Pierpont
Group, since prior to 1993. His address is
Pine Tree Country Club Estates, 10286 Saint
Andrews Road, Boynton Beach, Florida 33436.
Margaret W. Chambers 41 Executive Vice President and General Counsel
of JFD since April, 1998. From August 1996 to
March 1998, Ms. Chambers was Vice President
and Assistant General Counsel for Loomis,
Sayles & Company, L.P. From January 1986 to
July 1996, she was an associate with the law
firm of Ropes & Gray.
George A. Rio 46 President and Treasurer. Executive Vice
President and Client Service Director of JFD
since April 1998. From June 1995 to March
1998, Mr. Rio was Senior Vice President and
Senior Key Account Manager for Putnam Mutual
Funds.
ACCOUNTANTS
PricewaterhouseCoopers LLP serves as the Merging Fund's, the Surviving
Fund's and the Master Portfolio's independent accountants, auditing and
reporting on the annual financial statements and reviewing certain regulatory
reports and federal income tax returns. PricewaterhouseCoopers LLP also performs
other professional accounting, auditing, tax and advisory services when JPMF
engages it to do so.
AUDIT FEES. The aggregate fees paid to PricewaterhouseCoopers LLP in
connection with the annual audit of the Merging Fund and the Master Portfolio
for the last fiscal year was $37,500.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES. The
aggregate fees billed for financial systems design and implementation services
rendered by PricewaterhouseCoopers LLP to the Merging Fund, JPMIM and JPMIM's
affiliates that provide services to the Fund for the calendar year ended
December 31, 2000 was $0.
ALL OTHER FEES. The aggregate fees billed for all other non-audit
services, including fees for tax-related services, rendered by
PricewaterhouseCoopers LLP to the Merging Fund, JPMIM and JPMIM's affiliates
that provide services to the Fund for the calendar year ended December 31, 2000
was $11,025,600.
The Audit Committee has considered whether the provision of non-audit
services is compatible with maintaining the independence of
PricewaterhouseCoopers LLP.
27
INFORMATION RELATING TO VOTING MATTERS
GENERAL INFORMATION
This Combined Prospectus/Proxy Statement is being furnished in
connection with the solicitation of proxies by the JPMF Board for use at the
Meeting. It is expected that the solicitation of proxies will be primarily by
mail. JPMF's officers and service providers may also solicit proxies by
telephone, facsimile machine, telegraph, the Internet or personal interview. In
addition JPMF may retain the services of professional solicitors to aid in the
solicitation of proxies for a fee. It is anticipated that banks, brokerage
houses and other custodians will be requested on behalf of JPMF to forward
solicitation materials to their principals to obtain authorizations for the
execution of proxies. Any Merging Fund Shareholder giving a proxy may revoke it
at any time before it is exercised by submitting to JPMF a written notice of
revocation or a subsequently executed proxy or by attending the Meeting and
electing to vote in person.
Only the Merging Fund Shareholders of record at the close of business
on _________, 2001 will be entitled to vote at the Meeting. On that date, there
were outstanding and entitled to be voted _____________ Merging Fund Shares.
Each share or fraction thereof is entitled to one vote or fraction thereof.
The presence in person or by proxy of shareholders that own one-third
of the outstanding Merging Fund Shares will constitute a quorum for purposes of
transacting all business at the Meeting. If a quorum is not present at the
Meeting, sufficient votes in favor of the proposals are not received by the time
scheduled for the Meeting, or the Merging Fund Shareholders determine to adjourn
the Meeting for any other reason, the Merging Fund Shareholders present (in
person or proxy) may adjourn the Meeting from time to time, without notice other
than announcement at the Meeting. Any such adjournment will require the
affirmative vote of the Merging Fund Shareholders holding a majority of the
Merging Fund Shares present, in person or by proxy, at the Meeting. The persons
named in the Proxy will vote in favor of such adjournment those Merging Fund
Shares that they are entitled to vote if such adjournment is necessary to obtain
a quorum or if they determine such an adjournment is desirable for any other
reason. Business may be conducted once a quorum is present and may continue
until adjournment of the Meeting notwithstanding the withdrawal or temporary
absence of sufficient Merging Fund Shares to reduce the number present to less
than a quorum. If the accompanying proxy is executed and returned in time for
the Meeting, the shares covered thereby will be voted in accordance with the
proxy on all matters that may properly come before the meeting (or any
adjournment thereof).
PROXIES
All Merging Fund Shares represented by each properly signed proxy
received prior to the Meeting will be voted at the Meeting. If a Merging Fund
Shareholder specifies how the proxy is to be voted on any of the business to
come before the Meeting, it will be voted in accordance with such
specifications. If a Merging Fund Shareholder returns its proxy but no direction
is made on the proxy, the proxy will be voted FOR each Proposal described in
this Combined Prospectus/Proxy Statement. The Merging Fund Shareholders voting
to ABSTAIN on the Proposals will be treated as present for purposes of achieving
a quorum and in determining the votes cast on the Proposals, but not as having
voted FOR the Proposals. A properly signed proxy
28
on which a broker has indicated that it has no authority to vote on the
Proposals on behalf of the beneficial owner (a "broker non-vote") will be
treated as present for purposes of achieving a quorum but will not be counted in
determining the votes cast on the Proposals.
A proxy granted by any Merging Fund Shareholder may be revoked by such
Merging Fund Shareholder at any time prior to its use by written notice to JPMF,
by submission of a later dated Proxy or by voting in person at the Meeting. If
any other matters come before the Meeting, proxies will be voted by the persons
named as proxies in accordance with their best judgment.
EXPENSES OF PROXY SOLICITATION
JPMC, and not the Merging Fund or the Surviving Fund (or shareholders
of either Fund), will bear the cost of solicitation of proxies, including the
cost of printing, preparing, assembling and mailing the Notice of Meeting,
Combined Prospectus/Proxy Statement and form of proxy. In addition to
solicitations by mail, proxies may also be solicited by officers and regular
employees of JPMF by personal interview, by telephone or by telegraph without
additional remuneration thereof. Professional solicitors may also be retained.
ABSTENTIONS AND BROKER NON-VOTES
In tallying the Merging Fund Shareholder votes, abstentions and broker
non-votes (i.e., proxies sent in by brokers and other nominees that cannot be
voted on a proposal because instructions have not been received from the
beneficial owners) will be counted for purposes of determining whether or not a
quorum is present for purposes of convening the Meeting. Abstentions and broker
non-votes will be considered to be a vote against each proposal.
INTERESTED PARTIES
On the record date, the Trustees and officers of JPMF as a group owned
less than 1% of the outstanding shares of the Merging Fund. On the record date,
the name, address and percentage ownership of the persons who owned beneficially
more than 5% of the shares of the Merging Fund or any class thereof and the
percentage of any class or series of shares of the Surviving Fund or any class
thereof that would be owned by such persons upon consummation of the
Reorganization based upon their holdings at _______, 2001 are as follows:
Percentage of Percentage of
Amount of Merging Fund Surviving Fund
Shares Owned on Owned Upon
Name and Address Owned Record Date Consummation
- ---------------------- ------------- -------------- ---------------
On the record date, the Trustees and officers of JPMF as a group owned
less than 1% of the outstanding shares of the Surviving Fund. On the record
date, the name, address and share ownership of the persons who owned
beneficially more than 5% of the shares of the Surviving Fund or any class
thereof and the percentage of any class or series of shares of the Surviving
Fund or any class thereof that would be owned by such person upon consummation
of the Reorganization based upon their holdings at _________, 2001 were as
follows:
29
Percentage of
Amount of Surviving Fund Percentage of Surviving
Shares Owned on Record Fund Owned Upon
Name and Address Owned Date Consummation
- ------------------- ------------ ------------------- ------------------------
ADDITIONAL INFORMATION ABOUT JPMF
Information about each of the Merging Fund and the Surviving Fund is
included in its Prospectus, which is incorporated by reference herein. The
Surviving Fund's Prospectus is also enclosed herein. Additional information
about each of the Merging Fund and the Surviving Fund is also included in JPMF's
Statements of Additional Information with respect to each of them which has been
filed with the Commission and which are incorporated herein by reference. Copies
of the Statements of Additional information may be obtained without charge by
calling 1-800-521-5411. JPMF is subject to the requirements of the 1940 Act and,
in accordance with such requirements, files reports and other information with
the Commission. These materials can be inspected and copied at the Public
Reference Facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the Commission's Regional Offices at 7 World
Trade Center, Suite 1300, New York, NY 10048 and 500 West Madison Street, Suite
1400, Chicago, Illinois 60661. Copies of such material can also be obtained from
the Public Reference Branch, Office of Consumer Affairs and Information
Services, Securities and Exchange Commission, Washington, D.C. 20549, at
prescribed rates, and are also available on the Commission's web site at
http://www.sec.gov.
FINANCIAL STATEMENTS AND EXPERTS
The audited financial highlights, financial statements and notes
thereto of each of the Merging Fund and the Surviving Fund for the fiscal year
ended May 31, 2000, and the audited financial statements, notes thereto and
supplementary data of the Master Portfolio for the fiscal year ended May 31,
2000, are incorporated by reference herein and into the Statement of Additional
Information related to this Combined Prospectus/Proxy Statement. The audited
financial highlights, financial statements, notes thereto and supplemental data,
as applicable, of the Merging Fund, the Surviving Fund and the Master Portfolio
have been incorporated herein by reference in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on their authority as
experts in auditing and accounting.
The unaudited financial highlights, financial statements and notes
thereto of each of the Merging Fund and the Surviving Fund for the fiscal period
ended November 30, 2000, and the unaudited financial statements, notes thereto
and supplementary data of the Master Portfolio for the fiscal period ended
November 30, 2000, are incorporated by reference herein and into the Statement
of Additional Information related to this Combined Prospectus/Proxy Statement.
OTHER BUSINESS
The JPMF Board knows of no other business to be brought before the
Meeting. However, if any other matters come before the Meeting, it is the
intention of the JPMF Board
30
that proxies that do not contain specific restrictions to the contrary will be
voted on such matters in accordance with the judgment of the persons named in
the enclosed form of proxy.
LITIGATION
JPMF is not involved in any litigation that would have any material
adverse effect upon either the Merging Fund or the Surviving Fund.
SHAREHOLDER INQUIRIES
Shareholder inquiries may be addressed to JPMF in writing at the
address on the cover page of this Combined Prospectus/Proxy Statement or by
telephoning 1-800-766-7722.
* * *
SHAREHOLDERS WHO DO NOT EXPECT TO BE PRESENT AT THE MEETING ARE
REQUESTED TO DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT IN THE ENCLOSED
ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.
31
APPENDIX A
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Plan") made this ____
day of ______, 2001 by and among J.P. Morgan Institutional Funds (the
"Transferor Trust"), a Massachusetts business trust, on behalf of the J.P.
Morgan U.S. Equity Fund-Advisor Series (the "Transferor Portfolio"), J.P.
Morgan Institutional Funds (the "Acquiring Trust"), a Massachusetts business
trust, on behalf of the J.P. Morgan Institutional U.S. Equity Fund (the
"Acquiring Portfolio") and J.P. Morgan Chase & Co.
WHEREAS, the Board of Trustees of each of the Transferor Trust and the
Acquiring Trust has determined that the transfer of all of the assets and
liabilities of the Transferor Portfolio to the Acquiring Portfolio is in the
best interests of the Transferor Portfolio and the Acquiring Portfolio, as well
as the best interests of shareholders of the Transferor Portfolio and the
Acquiring Portfolio, and that the interests of existing shareholders would not
be diluted as a result of this transaction;
WHEREAS, each of the Transferor Trust and the Acquiring Trust intends
to provide for the reorganization of the Transferor Portfolio (the
"Reorganization") through the acquisition by the Acquiring Portfolio of all
of the assets, subject to all of the liabilities, of the Transferor Portfolio
in exchange for shares of beneficial interest of the Acquiring Portfolio (the
"Acquiring Portfolio Shares"), the liquidation of the Transferor Portfolio and
the distribution to Transferor Portfolio shareholders of such Acquiring
Portfolio Shares, all pursuant to the provisions of Section 368(a)(1) of the
Internal Revenue Code of 1986, as amended (the "Code");
NOW, THEREFORE, in consideration of the mutual promises herein contained,
the parties hereto agree as follows:
1. TRANSFER OF ASSETS OF THE TRANSFEROR PORTFOLIO IN EXCHANGE FOR THE
ACQUIRING PORTFOLIO SHARES AND LIQUIDATION AND TERMINATION OF THE TRANSFEROR
PORTFOLIO
(a) PLAN OF REORGANIZATION.
(i) The Transferor Trust on behalf of the Transferor Portfolio listed
above, will convey, transfer and deliver to the Acquiring Portfolio all of the
then existing assets of the Transferor Portfolio (consisting, without
limitation, of portfolio securities and instruments, dividend and interest
receivables, cash and other assets). In consideration thereof, the Acquiring
Trust on behalf of the Acquiring Portfolio will (A) assume and pay, to the
extent that they exist on or after the Effective Time of the Reorganization (as
defined in Section 1(b)(i) hereof), all of the obligations and liabilities of
the Transferor Portfolio and (B) issue and deliver to the Transferor Portfolio
full and fractional shares of beneficial interest of the Acquiring Portfolio,
with respect to the Acquiring Portfolio equal to that number of full and
fractional Acquiring Portfolio Shares as determined in Section 1(c) hereof. The
Acquiring Portfolio Shares issued and delivered to the Transferor Portfolio
shall be of the Class A share class in exchange for Shares of the Transferor
Portfolio, with the amounts of shares to be determined by the parties.
A-1
Any shares of beneficial interest (if any) of the Transferor Portfolio
("Transferor Portfolio Shares") held in the treasury of the Transferor Trust
at the Effective Time of the Reorganization shall thereupon be retired. Such
transactions shall take place on the date provided for in Section 1(b) hereof
(the "Exchange Date"). All computations for the Transferor Portfolio and the
Acquiring Portfolio shall be performed by The Chase Manhattan Bank (the
"Custodian"), as custodian and pricing agent for the Transferor Portfolio and
the Acquiring Portfolio. The determination of said Custodian shall be
conclusive and binding on all parties in interest.
(ii) As of the Effective Time of the Reorganization, the Transferor
Trust will liquidate and distribute pro rata to its shareholders of record
("Transferor Portfolio Shareholders") as of the Effective Time of the
Reorganization the Acquiring Portfolio Shares received by such Transferor
Portfolio pursuant to Section 1(a)(i) in actual or constructive exchange for
the shares of the Transferor Portfolio held by the Transferor Portfolio
shareholders. Such liquidation and distribution will be accomplished by the
transfer of the Acquiring Portfolio Shares then credited to the account of
the Transferor Portfolio on the books of the Acquiring Portfolio, to open
accounts on the share records of the Acquiring Portfolio in the names of the
Transferor Portfolio Shareholders and representing the respective pro rata
number of the Acquiring Portfolio Shares due such shareholders. The Acquiring
Portfolio will not issue certificates representing the Acquiring Portfolio
Shares in connection with such exchange.
(iii) As soon as practicable after the Effective Time of the
Reorganization, the Transferor Trust shall take all the necessary steps under
Massachusetts law, the Transferor Trust s Declaration of Trust and any other
applicable law to effect a complete termination of the Transferor Portfolio.
(b) EXCHANGE DATE AND EFFECTIVE TIME OF THE REORGANIZATION.
(i) Subject to the satisfaction of the conditions to the
Reorganization specified in this Plan, the Reorganization shall occur as of
the close of regularly scheduled trading on the New York Stock Exchange (the
"Effective Time of the Reorganization") on August 11, 2001, or such later
date as may be agreed upon by the parties (the "Exchange Date").
(ii) All acts taking place on the Exchange Date shall be deemed to take
place simultaneously as of the Effective Time of the Reorganization unless
otherwise provided.
(iii) In the event that on the proposed Exchange Date (A) the New York
Stock Exchange shall be closed to trading or trading thereon shall be
restricted, or (B) trading or the reporting of trading on said Exchange or
elsewhere shall be disrupted so that accurate valuation of the net assets of the
Acquiring Portfolio or the Transferor Portfolio is impracticable, the Exchange
Date shall be postponed until the first business day after the day when trading
shall have been fully resumed and reporting shall have been restored.
(iv) On the Exchange Date, portfolio securities of the Transferor
Portfolio shall be transferred by the Custodian to the accounts of the Acquiring
Portfolio duly endorsed in proper form for transfer, in such condition as to
constitute good delivery thereof in accordance with the custom of brokers, and
shall be accompanied by all necessary federal and state stock transfer stamps or
a check for the appropriate purchase price thereof.
A-2
(c) VALUATION.
(i) The net asset value of the shares of the Acquiring Portfolio and
the net value of the assets of the Transferor Portfolio to be transferred in
exchange therefore shall be determined as of the Effective Time of the
Reorganization. The net asset value of the Acquiring Portfolio Shares shall be
computed by the Custodian in the manner set forth in the Acquiring Trust's
Declaration of Trust or By-laws and then current prospectus and statement of
additional information and shall be computed to not less than two decimal
places. The net value of the assets of the Transferor Portfolio to be
transferred shall be computed by the Custodian by calculating the value of the
assets transferred by the Transferor Portfolio and by subtracting therefrom the
amount of the liabilities assigned and transferred to the Acquiring Portfolio,
said assets and liabilities to be valued in the manner set forth in the
Transferor Trust's Declaration of Trust or By-laws and then current prospectus
and statement of additional information.
(ii) The number of Class A Shares of the Acquiring Portfolio to be
issued (including fractional shares, if any) by the Acquiring Portfolio in
exchange for the Transferor Portfolio's assets attributable to the Transferor
Portfolio's shares shall be determined by an exchange ratio computed by
dividing the net value of the Transferor Portfolio's assets attributable to
its shares by the net asset value per share of the Class A shares of the
Acquiring Portfolio, both as determined in accordance with Section 1(c)(i).
All computations of value shall be made by the Custodian in accordance with
its regular practice as pricing agent for the Acquiring Portfolio and the
Transferor Portfolio.
2. REPRESENTATIONS AND WARRANTIES OF THE ACQUIRING TRUST
The Acquiring Trust represents and warrants as follows:
(a) ORGANIZATION, EXISTENCE, ETC. The Acquiring Trust is a business
trust that is duly organized, validly existing and in good standing under the
laws of the Commonwealth of Massachusetts and has the power to carry on its
business as it is now being conducted. The Acquiring Portfolio is a validly
existing series of shares of such business trust representing interests therein
under the laws of Massachusetts. Each of the Acquiring Portfolio and the
Acquiring Trust have all necessary federal, state and local authorization to own
all of its properties and assets and to carry on its business as now being
conducted.
(b) REGISTRATION AS INVESTMENT COMPANY. The Acquiring Trust is
registered under the Investment Company Act of 1940, as amended (the "Act")
as an open-end investment company of the management type; such registration
has not been revoked or rescinded and is in full force and effect.
(c) CURRENT OFFERING DOCUMENTS. The current prospectus and
statement of additional information of the Acquiring Trust, as amended,
included in the Acquiring Trust's registration statement on Form N-1A filed
with the Securities and Exchange Commission, comply in all material respects
with the requirements of the Securities Act of 1933, as amended (the
"Securities Act") and the Act and do not contain an untrue statement of a
material fact or omit to
A-3
state a material fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading.
(d) CAPITALIZATION. The Acquiring Trust has an unlimited number of
authorized shares of beneficial interest, of which as of November 30, 2000
there were outstanding 15,051,872 shares of the Acquiring Portfolio, and no
shares of such Portfolio were held in the treasury of the Acquiring Trust.
All of the outstanding shares of the Acquiring Trust have been duly
authorized and are validly issued, fully paid and nonassessable (except as
disclosed in the Acquiring Trust's prospectus and recognizing that under
Massachusetts law, shareholders of an Acquiring Trust portfolio could, under
certain circumstances, be held personally liable for the obligations of such
Acquiring Trust portfolio). Because the Acquiring Trust is an open-end
investment company engaged in the continuous offering and redemption of its
shares, the number of outstanding shares may change prior to the Effective
Time of the Reorganization. All of the issued and outstanding shares of the
Acquiring Portfolio have been offered and sold in compliance in all material
respects with applicable registration requirements of the Securities Act and
applicable state securities laws.
(e) FINANCIAL STATEMENTS. The financial statements of the Acquiring
Trust with respect to the Acquiring Portfolio and The U.S. Equity Portfolio
for the fiscal year ended May 31, 2000, which have been audited by
PricewaterhouseCoopers LLP, fairly present the financial position of the
Acquiring Portfolio and The U.S. Equity Portfolio as of the dates thereof and
the respective results of operations and changes in net assets for each of
the periods indicated in accordance with generally accepted accounting
principles ("GAAP"). The financial statements of the Acquiring Trust with
respect to the Acquiring Portfolio and for The U.S. Equity Portfolio for the
fiscal period ended November 30, 2000 fairly present the financial position
of the Acquiring Portfolio as of the dates thereof and the respective results
of operations and changes in net assets for each of the periods indicated in
accordance with GAAP.
(f) SHARES TO BE ISSUED UPON REORGANIZATION. The Acquiring
Portfolio Shares to be issued in connection with the Reorganization will be
duly authorized and upon consummation of the Reorganization will be validly
issued, fully paid and nonassessable (except as disclosed in the Trust's
prospectus and recognizing that under Massachusetts law, shareholders of an
Acquiring Trust portfolio could, under certain circumstances, be held
personally liable for the obligations of such portfolio).
(g) AUTHORITY RELATIVE TO THIS PLAN. The Acquiring Trust, on behalf
of the Acquiring Portfolio, has the power to enter into this Plan and to
carry out its obligations hereunder. The execution and delivery of this Plan
and the consummation of the transactions contemplated hereby have been duly
authorized by the Acquiring Trust's Board of Trustees and no other
proceedings by the Acquiring Trust other than those contemplated under this
Plan are necessary to authorize its officers to effectuate this Plan and the
transactions contemplated hereby. The Acquiring Trust is not a party to or
obligated under any provision of its Declaration of Trust or By-laws, or
under any indenture or contract provision or any other commitment or
obligation, or subject to any order or decree, which would be violated by or
which would prevent its execution and performance of this Plan in accordance
with its terms.
A-4
(h) LIABILITIES. There are no liabilities of the Acquiring
Portfolio, whether actual or contingent and whether or not determined or
determinable, other than liabilities disclosed or provided for in the
Acquiring Trust's financial statements with respect to the Acquiring
Portfolio and liabilities incurred in the ordinary course of business
subsequent to November 30, 2000 or otherwise previously disclosed to the
Acquiring Trust with respect to the Acquiring Portfolio, none of which has
been materially adverse to the business, assets or results of operations of
the Acquiring Portfolio.
(i) NO MATERIAL ADVERSE CHANGE. Since November 30, 2000, there has
been no material adverse change in the financial condition, results of
operations, business, properties or assets of the Acquiring Portfolio, other
than those occurring in the ordinary course of business (for these purposes,
a decline in net asset value and a decline in net assets due to redemptions
do not constitute a material adverse change).
(j) LITIGATION. There are no claims, actions, suits or proceedings
pending or, to the knowledge of the Acquiring Trust, threatened which would
adversely affect the Acquiring Trust or the Acquiring Portfolio's assets or
business or which would prevent or hinder consummation of the transactions
contemplated hereby, there are no facts which would form the basis for the
institution of administrative proceedings against the Acquiring Trust or the
Acquiring Portfolio and, to the knowledge of the Acquiring Trust, there are
no regulatory investigations of the Acquiring Trust or the Acquiring
Portfolio, pending or threatened, other than routine inspections and audits.
(k) CONTRACTS. No default exists under any material contract or
other commitment to which the Acquiring Trust, on behalf of the Acquiring
Portfolio, is subject.
(l) TAXES. The federal income tax returns of the Acquiring Trust
with respect to the Acquiring Portfolio, and all other income tax returns
required to be filed by the Acquiring Trust with respect to the Acquiring
Portfolio, have been filed and all taxes payable pursuant to such returns
have been paid. To the knowledge of the Acquiring Trust, no such return is
under audit and no assessment has been asserted in respect of any such
return. All federal and other taxes owed by the Acquiring Trust with respect
to the Acquiring Portfolio have been paid so far as due. The Acquiring
Portfolio has elected to qualify and has qualified as a "regulated investment
company" under Subchapter M of the Code as of and since its first taxable
year and intends to continue to so qualify.
(m) NO APPROVALS REQUIRED. Except for the Registration Statement
(as defined in Section 4(a) hereof) and the approval of the Transferor
Portfolio's shareholders (referred to in Section 6(a) hereof), no consents,
approvals, authorizations, registrations or exemptions under federal or state
laws are necessary for the consummation by the Acquiring Trust of the
Reorganization, except such as have been obtained as of the date hereof.
A-5
3. REPRESENTATIONS AND WARRANTIES OF THE TRANSFEROR TRUST
The Transferor Trust represents and warrants as follows:
(a) ORGANIZATION, EXISTENCE, ETC. The Transferor Trust is a
business trust that is duly organized, validly existing and in good standing
under the laws of the Commonwealth of Massachusetts and has the power to
carry on its business as it is now being conducted. The Transferor Portfolio
is a validly existing series of shares of such business trust representing
interests therein under the laws of Massachusetts. Each of Transferor
Portfolio and the Transferor Trust has all necessary federal, state and local
authorization to own all of its properties and assets and to carry on its
business as now being conducted.
(b) REGISTRATION AS INVESTMENT COMPANY. The Transferor Trust is
registered under the Act as an open-end investment company of the management
type; such registration has not been revoked or rescinded and is in full
force and effect.
(c) CURRENT OFFERING DOCUMENTS. The current prospectus and statement
of additional information of the Transferor Trust, as amended, included in the
Transferor Trust's registration statement on Form N-1A filed with the
Commission, comply in all material respects with the requirements of the
Securities Act and the Act and do not contain an untrue statement of a material
fact or omit to state a material fact necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading.
(d) CAPITALIZATION. The Transferor Trust has an unlimited number of
authorized shares of beneficial interest, of which as of November 30, 2000
there were outstanding 53,157 shares of the Transferor Portfolio, and no
shares of such Portfolio were held in the treasury of the Transferor Trust.
All of the outstanding shares of the Transferor Trust have been duly
authorized and are validly issued, fully paid and nonassessable (except as
disclosed in the Transferor Trust's prospectus and recognizing that under
Massachusetts law, shareholders of a Trust portfolio could, under certain
circumstances, be held personally liable for the obligations of such Trust
portfolio). Because the Transferor Trust is an open-end investment company
engaged in the continuous offering and redemption of its shares, the number
of outstanding shares may change prior to the Effective Time of the
Reorganization. All such shares will, at the Exchange Date, be held by the
shareholders of record of the Transferor Portfolio as set forth on the books
and records of the Transferor Trust in the amounts set forth therein, and as
set forth in any list of shareholders of record provided to the Acquiring
Portfolio for purposes of the Reorganization, and no such shareholders of
record will have any preemptive rights to purchase any Transferor Portfolio
shares, and the Transferor Portfolio does not have outstanding any options,
warrants or other rights to subscribe for or purchase any Transferor
Portfolio shares (other than any existing dividend reinvestment plans of the
Transferor Portfolio or as set forth in this Plan), nor are there outstanding
any securities convertible into any shares of the Transferor Portfolio
(except pursuant to any existing exchange privileges described in the current
prospectus and statement of additional information of the Transferor Trust).
All of the Transferor Portfolio's issued and outstanding shares have been
offered and sold in compliance in all material respects with applicable
registration requirements of the Securities Act and applicable state
securities laws.
A-6
(e) FINANCIAL STATEMENTS. The financial statements for the
Transferor Trust with respect to the Transferor Portfolio and The U.S. Equity
Portfolio for the fiscal year ended May 31, 2000 which have been audited by
PricewaterhouseCoopers LLP fairly present the financial position of the
Transferor Portfolio and The U.S. Equity Portfolio as of the dates thereof
and the respective results of operations and changes in net assets for each
of the periods indicated in accordance with GAAP. The financial statements of
the Transferor Trust with respect to the Transferor Portfolio and The U.S.
Equity Portfolio for the fiscal period ended November 30, 2000 fairly present
the financial position of the Transferor Portfolio as of the dates thereof
and the respective results of operations and changes in net assets for each
of the periods indicated in accordance with GAAP.
(f) AUTHORITY RELATIVE TO THIS PLAN. The Transferor Trust, on
behalf of the Transferor Portfolio, has the power to enter into this Plan and
to carry out its obligations hereunder. The execution and delivery of this
Plan and the consummation of the transactions contemplated hereby have been
duly authorized by the Transferor Trust s Board of Trustees and no other
proceedings by the Transferor Trust other than those contemplated under this
Plan are necessary to authorize its officers to effectuate this Plan and the
transactions contemplated hereby. The Transferor Trust is not a party to or
obligated under any provision of its Declaration of Trust or By-laws, or
under any indenture or contract provision or any other commitment or
obligation, or subject to any order or decree, which would be violated by or
which would prevent its execution and performance of this Plan in accordance
with its terms.
(g) LIABILITIES. There are no liabilities of the Transferor
Portfolio, whether actual or contingent and whether or not determined or
determinable, other than liabilities disclosed or provided for in the
Transferor Trust's Financial Statements with respect to the Transferor
Portfolio and liabilities incurred in the ordinary course of business
subsequent to November 30, 2000 or otherwise previously disclosed to the
Transferor Trust with respect to the Transferor Portfolio, none of which has
been materially adverse to the business, assets or results of operations of
the Transferor Portfolio.
(h) NO MATERIAL ADVERSE CHANGE. Since November 30, 2000, there has
been no material adverse change in the financial condition, results of
operations, business, properties or assets of the Transferor Portfolio, other
than those occurring in the ordinary course of business (for these purposes,
a decline in net asset value and a decline in net assets due to redemptions
do not constitute a material adverse change).
(i) LITIGATION. There are no claims, actions, suits or proceedings
pending or, to the knowledge of the Transferor Trust, threatened which would
adversely affect the Transferor Trust or the Transferor Portfolio's assets or
business or which would prevent or hinder consummation of the transactions
contemplated hereby, there are no facts which would form the basis for the
institution of administrative proceedings against the Transferor Trust or the
Transferor Portfolio and, to the knowledge of the Transferor Trust, there are
no regulatory investigations of the Transferor Trust or the Transferor
Portfolio, pending or threatened, other than routine inspections and audits.
(j) CONTRACTS. The Transferor Trust, on behalf of the Transferor
Portfolio, is not subject to any contracts or other commitments (other than
this Plan) which will not be terminated with
A-7
respect to the Transferor Portfolio without liability to the Transferor Trust
or the Transferor Portfolio as of or prior to the Effective Time of the
Reorganization.
(k) TAXES. The federal income tax returns of the Transferor Trust
with respect to the Transferor Portfolio, and all other income tax returns
required to be filed by the Transferor Trust with respect to the Transferor
Portfolio, have been filed and all taxes payable pursuant to such returns
have been paid. To the knowledge of the Transferor Trust, no such return is
under audit and no assessment has been asserted in respect of any such
return. All federal and other taxes owed by the Transferor Trust with respect
to the Transferor Portfolio have been paid so far as due. The Transferor
Portfolio has elected to qualify as a "regulated investment company" under
Subchapter M of the Code, as of and since its first taxable year, and shall
continue to so qualify until the Effective Time of the Reorganization.
(l) NO APPROVALS REQUIRED. Except for the Registration Statement
(as defined in Section 4(a) hereof) and the approval of the Transferor
Portfolio's shareholders referred to in Section 6(a) hereof, no consents,
approvals, authorizations, registrations or exemptions under federal or state
laws are necessary for the consummation by the Transferor Trust of the
Reorganization, except such as have been obtained as of the date hereof.
4. COVENANTS OF THE ACQUIRING TRUST
The Acquiring Trust covenants to the following:
(a) REGISTRATION STATEMENT. On behalf of the Acquiring Portfolio,
the Acquiring Trust shall file with the Commission a Registration Statement
on Form N-14 (the "Registration Statement") under the Securities Act relating
to the Acquiring Portfolio Shares issuable hereunder and the proxy statement
of the Transferor Portfolio relating to the meeting of the Transferor
Portfolio's shareholders referred to in Section 5(a) herein. At the time the
Registration Statement becomes effective, the Registration Statement (i) will
comply in all material respects with the provisions of the Securities Act and
the rules and regulations of the Commission thereunder (the "Regulations")
and (ii) will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading; and at the time the Registration Statement
becomes effective, at the time of the Transferor Portfolio shareholders'
meeting referred to in Section 5 (a) hereof, and at the Effective Time of the
Reorganization, the prospectus/proxy statement (the "Prospectus") and
statement of additional information (the "Statement of Additional
Information") included therein, as amended or supplemented by any amendments
or supplements filed by the Trust, will not contain an untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
(b) COOPERATION IN EFFECTING REORGANIZATION. The Acquiring Trust
agrees to use all reasonable efforts to effectuate the Reorganization, to
continue in operation thereafter, and to obtain any necessary regulatory
approvals for the Reorganization. The Acquiring Trust shall furnish such data
and information relating to the Acquiring Trust as shall be reasonably requested
for inclusion in the information to be furnished to the Transferor Portfolio
shareholders
A-8
in connection with the meeting of the Transferor Portfolio's shareholders for
the purpose of acting upon this Plan and the transactions contemplated herein.
(c) OPERATIONS IN THE ORDINARY COURSE. Except as otherwise
contemplated by this Plan, the Acquiring Trust shall conduct the business of
the Acquiring Portfolio in the ordinary course until the consummation of the
Reorganization, it being understood that such ordinary course of business
will include the declaration and payment of customary dividends and
distributions.
5. COVENANTS OF THE TRANSFEROR TRUST
The Transferor Trust covenants to the following:
(a) MEETING OF THE TRANSFEROR PORTFOLIO'S SHAREHOLDERS. The
Transferor Trust shall call and hold a meeting of the shareholders of the
Transferor Portfolio for the purpose of acting upon this Plan and the
transactions contemplated herein.
(b) PORTFOLIO SECURITIES. With respect to the assets to be
transferred in accordance with Section 1(a), the Transferor Portfolio's
assets shall consist of all property and assets of any nature whatsoever,
including, without limitation, all cash, cash equivalents, securities, claims
and receivables (including dividend and interest receivables) owned, and any
deferred or prepaid expenses shown as an asset on the Transferor Trust's
books maintained or on behalf of the Transferor Portfolio. At least five (5)
business days prior to the Exchange Date, the Transferor Portfolio will
provide the Acquiring Trust, for the benefit of the Acquiring Portfolio, with
a list of its assets and a list of its stated liabilities. The Transferor
Portfolio shall have the right to sell any of the securities or other assets
shown on the list of assets prior to the Exchange Date but will not, without
the prior approval of the Acquiring Trust, on behalf of the Acquiring
Portfolio, acquire any additional securities other than securities which the
Acquiring Portfolio is permitted to purchase, pursuant to its investment
objective and policies or otherwise (taking into consideration its own
portfolio composition as of such date). In the event that the Transferor
Portfolio holds any investments that the Acquiring Portfolio would not be
permitted to hold, the Transferor Portfolio will dispose of such securities
prior to the Exchange Date to the extent practicable, to the extent permitted
by its investment objective and policies and to the extent that its
shareholders would not be materially affected in an adverse manner by such a
disposition. In addition, the Transferor Trust will prepare and deliver
immediately prior to the Effective Time of the Reorganization, a Statement of
Assets and Liabilities of the Transferor Portfolio, prepared in accordance
with GAAP (each, a "Schedule"). All securities to be listed in the Schedule
for the Transferor Portfolio as of the Effective Time of the Reorganization
will be owned by the Transferor Portfolio free and clear of any liens,
claims, charges, options and encumbrances, except as indicated in such
Schedule, and, except as so indicated, none of such securities is or, after
the Reorganization as contemplated hereby, will be subject to any
restrictions, legal or contractual, on the disposition thereof (including
restrictions as to the public offering or sale thereof under the Securities
Act) and, except as so indicated, all such securities are or will be readily
marketable.
(c) REGISTRATION STATEMENT. In connection with the preparation of
the Registration Statement, the Transferor Trust will cooperate with the
Acquiring Trust and will furnish to the Acquiring Trust the information
relating to the Transferor Portfolio required by the Securities
A-9
Act and the Regulations to be set forth in the Registration Statement
(including the Prospectus and Statement of Additional Information). At the
time the Registration Statement becomes effective, the Registration
Statement, insofar as it relates to the Transferor Portfolio, (i) will comply
in all material respects with the provisions of the Securities Act and the
Regulations and (ii) will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading; and at the time the
Registration Statement becomes effective, at the time of the Transferor
Portfolio's shareholders meeting referred to in Section 5(a) and at the
Effective Time of the Reorganization, the Prospectus and Statement of
Additional Information, as amended or supplemented by any amendments or
supplements filed by the Transferor Trust, insofar as they relate to the
Transferor Portfolio, will not contain an untrue statement of a material fact
or omit to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
provided, however, that the representations and warranties in this subsection
shall apply only to statements in or omissions from the Registration
Statement, Prospectus or Statement of Additional Information made in reliance
upon and in conformity with information furnished by the Transferor Portfolio
for use in the registration statement, prospectus or statement of additional
information as provided in this Section 5(c).
(d) COOPERATION IN EFFECTING REORGANIZATION. The Transferor Trust
agrees to use all reasonable efforts to effectuate the Reorganization and to
obtain any necessary regulatory approvals for the Reorganization.
(e) OPERATIONS IN THE ORDINARY COURSE. Except as otherwise
contemplated by this Plan, the Transferor Trust shall conduct the business of
the Transferor Portfolio in the ordinary course until the consummation of the
Reorganization, it being understood that such ordinary course of business
will include the declaration and payment of customary dividends and
distributions.
(f) STATEMENT OF EARNINGS AND PROFITS. As promptly as practicable,
but in any case within 60 days after the Exchange Date, the Transferor Trust
on behalf of the Transferor Portfolio, shall prepare a statement of the
earnings and profits of the Transferor Portfolio for federal income tax
purposes, and of any capital loss carryovers and other items that the
Acquiring Portfolio will succeed to and take into account as a result of
Section 381 of the Code.
6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE TRANSFEROR TRUST
The obligations of the Transferor Trust with respect to the
consummation of the Reorganization are subject to the satisfaction of the
following conditions:
(a) APPROVAL BY THE TRANSFEROR PORTFOLIO'S SHAREHOLDERS. This Plan
and the transactions contemplated by the Reorganization shall have been
approved by the requisite vote of the shares of the Transferor Portfolio
entitled to vote on the matter ("Transferor Shareholder Approval").
(b) COVENANTS, WARRANTIES AND REPRESENTATIONS. The Acquiring Trust
shall have complied with each of its covenants contained herein, each of the
representations and warranties contained herein shall be true in all material
respects as of the Effective Time of the Reorganization (except as otherwise
contemplated herein), and there shall have been no material
A-10
adverse change (as described in Section 2(i)) in the financial condition,
results of operations, business, properties or assets of the Acquiring Portfolio
since November 30, 2000.
(c) REGULATORY APPROVAL. The Registration Statement shall have been
declared effective by the Commission and no stop orders under the Securities
Act pertaining thereto shall have been issued, and all other approvals,
registrations, and exemptions under federal and state laws considered to be
necessary shall have been obtained (collectively, the "Regulatory Approvals").
(d) TAX OPINION. The Transferor Trust shall have received the
opinion of Simpson Thacher & Bartlett, dated on or before the Exchange Date,
addressed to and in form and substance satisfactory to the Transferor Trust,
as to certain of the federal income tax consequences under the Code of the
Reorganization, insofar as it relates to the Transferor Portfolio and the
Acquiring Portfolio, and to shareholders of each Transferor Portfolio (the
"Tax Opinion"). For purposes of rendering the Tax Opinion, Simpson Thacher &
Bartlett may rely exclusively and without independent verification, as to
factual matters, upon the statements made in this Plan, the Prospectus and
Statement of Additional Information, and upon such other written
representations as the President or Treasurer of the Transferor Trust will
have verified as of the Effective Time of the Reorganization. The Tax Opinion
will be to the effect that, based on the facts and assumptions stated
therein, for federal income tax purposes: (i) the Reorganization will
constitute a reorganization within the meaning of section 368(a)(1) of the
Code with respect to the Transferor Portfolio and the Acquiring Portfolio;
(ii) no gain or loss will be recognized by any of the Transferor Portfolio or
the Acquiring Portfolio upon the transfer of all the assets and liabilities,
if any, of the Transferor Portfolio to the Acquiring Portfolio solely in
exchange for shares of the Acquiring Portfolio or upon the distribution of
the shares of the Acquiring Portfolio to the holders of the shares of the
Transferor Portfolio solely in exchange for all of the shares of the
Transferor Portfolio; (iii) no gain or loss will be recognized by
shareholders of the Transferor Portfolio upon the exchange of shares of such
Transferor Portfolio solely for shares of the Acquiring Portfolio; (iv) the
holding period and tax basis of the shares of the Acquiring Portfolio
received by each holder of shares of the Transferor Portfolio pursuant to the
Reorganization will be the same as the holding period and tax basis of shares
of the Transferor Portfolio held by such holder immediately prior to the
Reorganization; (provided the shares of the Transferor Portfolio were held as
a capital asset on the date of the Reorganization) and (v) the holding period
and tax basis of the assets of the Transferor Portfolio acquired by the
Acquiring Portfolio will be the same as the holding period and tax basis of
those assets to the Transferor Portfolio immediately prior to the
Reorganization.
(e) CONCURRENT REORGANIZATION. The reorganization of J.P. Morgan
U.S. Equity Fund, a series of J.P. Morgan Funds, into the Acquiring Portfolio
shall have been consummated.
7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING TRUST
The obligations of the Acquiring Trust with respect to the consummation
of the Reorganization are subject to the satisfaction of the following
conditions:
(a) APPROVAL BY THE TRANSFEROR PORTFOLIO'S SHAREHOLDERS. The
Transferor Shareholder Approval shall have been obtained.
A-11
(b) COVENANTS, WARRANTIES AND REPRESENTATIONS. The Transferor Trust
shall have complied with each of its covenants contained herein, each of the
representations and warranties contained herein shall be true in all material
respects as of the Effective Time of the Reorganization (except as otherwise
contemplated herein), and there shall have been no material adverse change
(as described in Section 3(h)) in the financial condition, results of
operations, business, properties or assets of the Transferor Portfolio since
November 30, 2000.
(c) PORTFOLIO SECURITIES. All securities to be acquired by the
Acquiring Portfolio in the Reorganization shall have been approved for
acquisition by J.P. Morgan Investment Management Inc. ("JPMIM"), in its
capacity as investment adviser to the Acquiring Portfolio, as consistent with
the investment policies of the Acquiring Portfolio.
(d) REGULATORY APPROVAL. The Regulatory Approvals shall have been
obtained.
(e) DISTRIBUTION OF INCOME AND GAINS. The Transferor Trust on
behalf of the Transferor Portfolio shall have distributed to the shareholders
of the Transferor Portfolio all of the Transferor Portfolio's investment
company taxable income (determined without regard to the deduction for
dividends paid) as defined in Section 852(b)(2) of the Code for its taxable
year ending on the Exchange Date and all of its net capital gain as such term
is used in Section 852(b)(3) of the Code, after reduction by any capital loss
carry forward, for its taxable year ending on the Exchange Date.
(f) TAX OPINION. The Acquiring Trust shall have received the Tax
Opinion.
(g) CONCURRENT REORGANIZATION. The reorganization of J.P. Morgan
U.S. Equity Fund , a series of J.P. Morgan Funds, into the Acquiring
Portfolio shall have been consummated.
8. AMENDMENTS; TERMINATIONS; NO SURVIVAL OF COVENANTS, WARRANTIES AND
REPRESENTATIONS
(a) AMENDMENTS. The parties hereto may, by agreement in writing
authorized by their Boards of Trustees amend this Plan at any time before or
after approval hereof by the shareholders of the Transferor Portfolio, but
after such approval, no amendment shall be made which substantially changes
the terms hereof.
(b) WAIVERS. At any time prior to the Effective Time of the
Reorganization, either the Transferor Trust or the Acquiring Trust may by
written instrument signed by it (i) waive any inaccuracies in the
representations and warranties made to it contained herein and (ii) waive
compliance with any of the covenants or conditions made for its benefit
contained herein, except that conditions set forth in Sections 6(c) and 7(d)
may not be waived.
(c) TERMINATION BY THE TRANSFEROR TRUST. The Transferor Trust, on
behalf of the Transferor Portfolio, may terminate this Plan with respect to
the Transferor Portfolio at any time prior to the Effective Time of the
Reorganization by notice to the Acquiring Trust and JPMIM if (i) a material
condition to the performance of the Transferor Trust hereunder or a material
covenant of the Acquiring Trust contained herein shall not be fulfilled on or
before the date specified for the fulfillment thereof or (ii) a material
default or material breach of this Plan shall
A-12
be made by the Acquiring Trust. In addition, this Plan may be terminated by
the Transferor Trust at any time prior to the Effective Time of the
Reorganization, whether before or after approval of this Plan by the
shareholders of the Transferor Portfolio, without liability on the part of
any party hereto, its Trustees, officers or shareholders or JPMIM on notice
to the other parties in the event that the Board of Trustees determines that
proceeding with this Plan is not in the best interests of the shareholders of
the Transferor Portfolio.
(d) TERMINATION BY THE ACQUIRING TRUST. The Acquiring Trust, on
behalf of the Acquiring Portfolio, may terminate this Plan with respect to
the Acquiring Portfolio at any time prior to the Effective Time of the
Reorganization by notice to the Transferor Trust and JPMIM if (i) a material
condition to the performance of the Acquiring Trust hereunder or a material
covenant of the Transferor Trust contained herein shall not be fulfilled on
or before the date specified for the fulfillment thereof or (ii) a material
default or material breach of this Plan shall be made by the Transferor
Trust. In addition, this Plan may be terminated by the Acquiring Trust at any
time prior to the Effective Time of the Reorganization, whether before or
after approval of this Plan by the shareholders of the Transferor Portfolio,
without liability on the part of any party hereto, its Trustees, officers or
shareholders or JPMIM on notice to the other parties in the event that the
Board of Trustees determines that proceeding with this Plan is not in the
best interests of the shareholders of the Acquiring Portfolio.
(e) SURVIVAL. No representations, warranties or covenants in or
pursuant to this Plan, except for the provisions of Section 5(f) and Section
9 of this Plan, shall survive the Reorganization.
9. EXPENSES
The expenses of the Reorganization will be borne by J.P. Morgan Chase
& Co ("JPMC"). Such expenses include, without limitation, (i) expenses
incurred in connection with the entering into and the carrying out of the
provisions of this Plan; (ii) expenses associated with the preparation and
filing of the Registration Statement; (iii) fees and expenses of preparing
and filing such forms as are necessary under any applicable state securities
laws in connection with the Reorganization; (iv) postage; (v) printing; (vi)
accounting fees; (vii) legal fees and (viii) solicitation costs relating to
the Reorganization. In addition, JPMC or an affiliate will waive fees payable
to it or reimburse expenses to the extent necessary such that the actual
(post-waiver) total expense ratios of the Select Class Shares and the
Institutional Class Shares of the Acquiring Portfolio are not higher than
those set forth in the Registration Statement Portfolio for a period of three
years after the Exchange Date.
10. NOTICES
Any notice, report, statement or demand required or permitted by any
provision of this Plan shall be in writing and shall be given by hand,
certified mail or by facsimile transmission, shall be deemed given when
received and shall be addressed to the parties hereto at their respective
addresses listed below or to such other persons or addresses as the relevant
party shall designate as to itself from time to time in writing delivered in
like manner:
A-13
if to the Transferor Trust (for itself or on behalf of the Transferor
Portfolio):
60 State Street
Suite 1300
Boston, Massachusetts 02109
with a copy to:
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Attention: John E. Baumgardner, Jr., Esq.
if to the Acquiring Trust (for itself or on behalf of the Acquiring
Portfolio):
60 State Street
Suite 1300
Boston, Massachusetts 02109
with a copy to:
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Attention: John E. Baumgardner, Jr., Esq.
11. RELIANCE
All covenants and agreements made under this Plan shall be deemed to
have been material and relied upon by the Transferor Trust and the Acquiring
Trust notwithstanding any investigation made by such party or on its behalf.
12. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT
(a) The section and paragraph headings contained in this Plan are
for reference purposes only and shall not affect in any way the meaning or
interpretation of this Plan.
(b) This Plan may be executed in any number of counterparts, each
of which shall be deemed an original.
(c) This Plan shall be governed by and construed in accordance with
the laws of the State of New York.
(d) This Plan shall bind and inure to the benefit of the Transferor
Trust, the Transferor Portfolio, the Acquiring Trust and the Acquiring
Portfolio and their respective successors and assigns, but no assignment or
transfer hereof or of any rights or obligations hereunder shall be
A-14
made by any party without the written consent of the other parties. Nothing
herein expressed or implied is intended or shall be construed to confer upon
or give any person, firm or corporation, other than the parties hereto and
their respective successors and assigns, any rights or remedies under or by
reason of this Plan.
(e) The name "J.P. Morgan Institutional Funds" is the designation
of its Trustees under a Declaration of Trust dated November 4, 1992, as
amended, and all persons dealing with the Acquiring Trust must look solely to
the Acquiring Trust's property for the enforcement of any claims against the
Acquiring Trust, as none of the Acquiring Trustees, officers, agents or
shareholders assumes any personal liability for obligations entered into on
behalf of the Acquiring Trust. No series of the Acquiring Trust shall be
liable for claims against any other series of the Acquiring Trust.
A-15
IN WITNESS WHEREOF, the undersigned have executed this Plan as of the
date first above written.
J.P. MORGAN INSTITUTIONAL FUNDS
on behalf of J.P. Morgan Institutional U.S. Equity Fund
By:
---------------------------------------
Name:
Title:
J.P. MORGAN INSTITUTIONAL FUNDS
on behalf of J.P. Morgan U.S. Equity Fund-Advisor Series
By:
---------------------------------------
Name:
Title:
Agreed and acknowledged with respect to Section 9:
J.P. MORGAN CHASE & CO.
By:
---------------------------------------
Name:
Title:
A-16
STATEMENT OF ADDITIONAL INFORMATION
(SPECIAL MEETING OF SHAREHOLDERS OF
J.P. MORGAN U.S. EQUITY FUND-ADVISOR SERIES
A SERIES OF J.P. MORGAN INSTITUTIONAL FUNDS)
This Statement of Additional Information is not a prospectus but
should be read in conjunction with the Combined Prospectus/Proxy Statement
dated May 12, 2001 for the Special Meeting of Shareholders of J.P. Morgan
U.S. Equity Fund-Advisor Series (the "Merging Fund"), a series of J.P. Morgan
Institutional Funds ("JPMF"), to be held on July 3, 2001. Copies of the
Combined Prospectus/Proxy Statement may be obtained at no charge by calling
JPMorgan U.S. Equity Fund-Advisor Series at ______________.
Unless otherwise indicated, capitalized terms used herein and not
otherwise defined have the same meanings as are given to them in the Combined
Prospectus/Proxy Statement.
Further information about the Surviving Fund and the Merging Fund is
contained in JPMF's Statements of Additional Information for the relevant
Fund, which are incorporated herein by reference.
The date of this Statement of Additional Information is May 12, 2001.
1
GENERAL INFORMATION
The Shareholders of the Merging Fund are being asked to consider and vote
on two proposals.
With respect to an Agreement and Plan of Reorganization (the
"Reorganization Plan") dated as of __________, 2001 by and among JPMF, on
behalf of the Merging Fund, JPMF, on behalf of the Surviving Fund, and JPMC,
and the transactions contemplated thereby, the Reorganization Plan
contemplates the transfer of all of the assets and liabilities of the Merging
Fund to the Surviving Fund in exchange for shares issued by JPMF in the
Surviving Fund that will have an aggregate net asset value equal to the
aggregate net asset value of the shares of the Merging Fund that are
outstanding immediately before the Effective Time of the Reorganization.
Following the exchange, the Merging Fund will make a liquidating
distribution of the Surviving Fund shares to its Shareholders, so that a
holder of Shares in the Merging Fund will receive Class A Shares of the
Surviving Fund of equal value, plus the right to receive any unpaid dividends
and distributions that were declared before the Effective Time of the
Reorganization.
At the Meeting, shareholders will also be asked to consider and vote
upon the election of Trustees of JPMF.
A Special Meeting of Shareholders of the Merging Fund to consider the
proposals and the related transaction will be held at the offices of J.P.
Morgan Chase & Co., 1211 Avenue of the Americas, 41st Floor, New York, NY, on
July 3, 2001 at 9:00 a.m., Eastern time. For further information about the
transaction, see the Combined Prospectus/Proxy Statement.
2
FINANCIAL STATEMENTS
The audited financial highlights, financial statements and notes thereto
of each of the Merging Fund and the Surviving Fund contained in their respective
Annual Reports dated May 31, 2000, and the audited financial statements, notes
thereto and supplementary data of the Master Portfolio contained in its Annual
Report dated May 31, 2000, are incorporated by reference into this Statement of
Additional Information related to this Combined Prospectus/Proxy Statement. The
audited financial highlights, financial statements, notes thereto and
supplementary data, as applicable, which appear in each of the Surviving Fund's,
the Master Portfolio's and the Merging Fund's Annual Report have been audited by
PricewaterhouseCoopers LLP, whose reports thereon also appear in such Annual
Reports and are also incorporated herein by reference. The financial highlights,
financial statements, notes thereto and supplementary data, as applicable, for
the Merging Fund, the Surviving Fund and the Master Portfolio for the fiscal
year ended May 31, 2000 have been incorporated herein by reference in reliance
on the report of PricewaterhouseCoopers LLP, independent accountants, given on
their authority as experts in auditing and accounting.
The unaudited financial highlights, financial statements and notes
thereto of the Merging Fund and the Surviving Fund contained in their respective
Semi-Annual Reports dated November 30, 2000, and the unaudited financial
statements, notes thereto and supplementary data of the Master Portfolio
contained in its Semi-Annual Report dated November 30, 2000, are incorporated by
reference into this Statement of Additional Information related to this Combined
Prospectus/Proxy Statement.
3
PRO FORMA FINANCIAL STATEMENTS
J.P. MORGAN U.S. EQUITY PORTFOLIO / CHASE VISTA LARGE CAP EQUITY FUND (1)
PRO FORMA COMBINING SCHEDULE OF INVESTMENTS
NOVEMBER 30, 2000
(UNAUDITED)
PRINCIPAL AMOUNT MARKET VALUE
------------------------------------------- ------------------------------------------------
PRO FORMA PRO FORMA PRO FORMA PRO FORMA
CHASE JPM ADJUSTMENTS COMBINED CHASE JPM ADJUSTMENTS COMBINED
---------- --------- ----------- ---------- ------------ ---------- ----------- -----------
COMMON STOCKS - 95.6%
CAPITAL MARKETS
CAPITAL MARKETS - 1.8%
Goldman Sachs Group, Inc. (The) 119,700 119,700 - 9,830,363 - 9,830,363
TD Waterhouse Group, Inc.(+) 253,400 253,400 - 3,357,550 - 3,357,550
------------------------------------------- ------------------------------------------------
- 373,100 - 373,100 - 13,187,913 - 13,187,913
------------------------------------------- ------------------------------------------------
COMPUTER HARDWARE
COMPUTER HARDWARE &
BUSINESS MACHINES - 9.1%
Avaya Inc.(+) 7,300 7,300 - 85,319 - 85,319
Cisco Systems Inc.(s)(+) 77,000 414,800 491,800 3,686,375 19,858,550 - 23,544,925
Compaq Computer Corp. 77,000 232,400 309,400 1,655,500 4,996,600 - 6,652,100
Dell Computer Corp.(+) 47,100 47,100 - 906,675 - 906,675
EMC Corp. (Mass.)(+) 46,000 104,500 150,500 3,421,250 7,772,188 - 11,193,438
Hewlett-Packard Co. 56,000 69,600 125,600 1,771,000 2,201,100 - 3,972,100
Quantum Corp. - DLT & Storage
Systems(+) 202,500 202,500 - 2,733,750 - 2,733,750
Sun Microsystems, Inc.(s)(+) 36,000 186,900 222,900 2,738,250 14,216,081 - 16,954,331
------------------------------------------- ------------------------------------------------
292,000 1,265,100 - 1,557,100 13,272,375 52,770,263 66,042,638
------------------------------------------- ------------------------------------------------
CONSUMER CYCLICAL
HOTELS - 0.3%
------------------------------------------- ------------------------------------------------
Marriott International, Inc. 58,700 58,700 - 2,432,381 - 2,432,381
------------------------------------------- ------------------------------------------------
MOTOR VEHICLES & PARTS - 1.9%
Dana Corp. 66,400 66,400 - 1,112,200 - 1,112,200
Delphi Automotive Systems 167,500 167,500 - 2,313,594 - 2,313,594
Ford Motor Company 145,136 93,492 238,628 3,301,844 2,126,943 - 5,428,787
General Motors Corp. 32,200 23,800 56,000 1,593,900 1,178,100 - 2,772,000
Lear Corp. (+) 129,800 129,800 - 2,839,375 - 2,839,375
------------------------------------------- ------------------------------------------------
177,336 480,992 - 658,328 4,895,744 9,570,212 - 14,465,956
------------------------------------------- ------------------------------------------------
RESTAURANTS - 0.3%
------------------------------------------- ------------------------------------------------
McDonald's Corp. 57,000 57,000 - 1,816,875 - 1,816,875
------------------------------------------- ------------------------------------------------
FOOD/ BEVERAGES - 1.2%
Anheuser-Busch Companies, Inc. 47,000 47,000 2,229,563 - 2,229,563
Coca-Cola Co. 42,300 42,300 2,649,038 - 2,649,038
PepsiCo, Inc. 40,000 40,000 1,815,000 - 1,815,000
Sysco Corp. 33,000 33,000 1,823,250 - 1,823,250
------------------------------------------- ------------------------------------------------
162,300 - - 162,300 8,516,851 - - 8,516,851
------------------------------------------- ------------------------------------------------
CONSUMER SERVICES
ENTERTAINMENT - 0.9%
------------------------------------------- ------------------------------------------------
Viacom, Inc. Cl B(+) 48,360 76,900 125,260 2,472,405 3,931,512 - 6,403,917
------------------------------------------- ------------------------------------------------
MEDIA - 2.0%
AT&T Corp. - Liberty Media
Group Cl A(+) 104,200 104,200 - 1,413,213 - 1,413,213
Charter Communications, Inc.(+) 40,758 40,758 - 804,971 - 804,971
Comcast Corp. Cl A(+) 93,800 93,800 - 3,605,438 - 3,605,438
News Corp. Ltd. (The) ADR(i) 106,400 106,400 - 3,710,699 - 3,710,699
The Walt Disney Co. 49,000 49,000 1,417,938 - - 1,417,938
See notes to Pro Forma Financial Statements
4
Time Warner Inc. 29,000 27,700 56,700 1,798,000 1,717,400 - 3,515,400
------------------------------------------- ------------------------------------------------
78,000 372,858 - 450,858 3,215,938 11,251,721 14,467,659
------------------------------------------- ------------------------------------------------
CONSUMER STABLE
HOME PRODUCTS - 3.1%
Clorox Company 52,800 52,800 - 2,359,500 - 2,359,500
Estee Lauder Companies, Inc. 62,700 62,700 - 2,715,694 - 2,715,694
Gillette Company 47,400 153,400 200,800 1,605,675 5,196,425 - 6,802,100
Procter & Gamble Co. (The) 142,000 142,000 - 10,632,250 - 10,632,250
------------------------------------------- ------------------------------------------------
47,400 410,900 - 458,300 1,605,675 20,903,869 - 22,509,544
------------------------------------------- ------------------------------------------------
TOBACCO - 1.8%
------------------------------------------- ------------------------------------------------
Philip Morris Companies Inc. 41,500 295,300 336,800 1,584,781 11,276,769 - 12,861,550
------------------------------------------- ------------------------------------------------
ENERGY
ENERGY RESERVES &
PRODUCTION - 5.1%
Anadarko Petroleum Corp. 44,500 44,500 - 2,647,750 - 2,647,750
Chevron Corp. 42,100 37,900 80,000 3,446,938 3,103,063 - 6,550,001
Exxon Mobil Corp.(s) 95,405 217,548 312,953 8,395,640 19,144,223 - 27,539,863
------------------------------------------- ------------------------------------------------
137,505 299,948 - 437,453 11,842,578 24,895,036 - 36,737,614
------------------------------------------- ------------------------------------------------
OIL REFINING - 0.2%
------------------------------------------- ------------------------------------------------
Texaco Inc. 24,100 24,100 - 1,399,306 - 1,399,306
------------------------------------------- ------------------------------------------------
OIL SERVICES - 1.0%
Baker Hughes Inc. 109,900 109,900 - 3,633,569 - 3,633,569
Global Marine Inc.(+) 108,600 108,600 - 2,382,413 - 2,382,413
------------------------------------------- ------------------------------------------------
- 242,600 - 242,600 - 6,015,982 - 6,015,982
------------------------------------------- ------------------------------------------------
OIL & GAS - 1.2%
BP Amoco PLC, ADR
(United Kingdom) 24,000 24,000 1,138,500 - - 1,138,500
Halliburton Co. 41,500 41,500 1,385,063 - - 1,385,063
Royal Dutch Petroleum Co.,
N.Y. Registered Shares
(Netherlands) 75,800 75,800 4,524,313 - - 4,524,313
Schlumberger LTD 28,000 28,000 1,736,000 1,736,000
------------------------------------------- ------------------------------------------------
169,300 - - 169,300 8,783,876 - - 8,783,876
------------------------------------------- ------------------------------------------------
FINANCE
BANKS - 5.5%
Amsouth Bancorporation 223,100 223,100 - 3,318,613 - 3,318,613
Bank of New York Co., Inc. 85,834 85,834 4,736,964 - - 4,736,964
Citigroup Inc. 197,000 81,566 278,566 9,813,063 4,063,006 - 13,876,069
First Union Corp. 103,000 103,000 - 2,587,875 - 2,587,875
Firstar Corp.(s) 608,000 608,000 - 11,780,000 - 11,780,000
Wells Fargo Co. 68,500 68,500 3,249,469 - - 3,249,469
------------------------------------------- ------------------------------------------------
351,334 792,566 - 1,143,900 17,799,496 21,749,494 - 39,548,990
------------------------------------------- ------------------------------------------------
FINANCIAL SERVICES - 7.6%
American Express Co. 66,600 66,600 3,658,838 - - 3,658,838
Associates First
Capital Corp. 219,900 219,900 - 7,765,219 - 7,765,219
Capital One Financial Corp. 69,900 69,900 - 3,901,294 - 3,901,294
Countrywide Credit
Industries, Inc. 95,900 95,900 - 3,560,288 - 3,560,288
Fannie Mae 20,700 20,700 1,635,300 - - 1,635,300
Federal Home Loan Mortgage Corp. 43,100 43,100 - 2,604,856 - 2,604,856
General Electric Co. (U.S.)(s) 213,916 331,700 545,616 10,602,212 16,439,880 - 27,042,092
Morgan Stanley Dean Witter & Co. 38,000 38,000 2,408,250 - - 2,408,250
Providian Financial Corp. 14,700 14,700 - 1,323,000 - 1,323,000
State Street Corp. 9,400 9,400 1,212,600 - - 1,212,600
------------------------------------------- ------------------------------------------------
348,616 775,200 - 1,123,816 19,517,200 35,594,537 - 55,111,737
------------------------------------------- ------------------------------------------------
THRIFTS - 0.4%
------------------------------------------- ------------------------------------------------
Washington Mutual, Inc. 56,300 56,300 - 2,558,131 - 2,558,131
------------------------------------------- ------------------------------------------------
HEALTH SERVICES & SYSTEMS
MEDICAL PRODUCTS &
SUPPLIES - 1.1%
Bard (C.R.), Inc. 38,700 38,700 - 1,905,975 - 1,905,975
Becton Dickinson & Co. 89,100 89,100 - 3,029,400 - 3,029,400
Medtronic, Inc. 53,200 53,200 - 2,832,900 - 2,832,900
------------------------------------------- ------------------------------------------------
- 181,000 - 181,000 - 7,768,275 - 7,768,275
------------------------------------------- ------------------------------------------------
INDUSTRIAL CYCLICAL
CHEMICALS - 1.9%
See notes to Pro Forma Financial Statements
5
Air Products & Chemicals, Inc. 205,300 205,300 - 7,070,019 - 7,070,019
Dow Chemical Co. 33,300 33,300 1,017,731 - - 1,017,731
E.I. DuPont de Nemours Co. 52,900 52,900 2,238,331 - - 2,238,331
Rohm and Haas Co. 112,700 112,700 - 3,352,825 - 3,352,825
------------------------------------------- ------------------------------------------------
86,200 318,000 - 404,200 3,256,062 10,422,844 - 13,678,906
------------------------------------------- ------------------------------------------------
DEFENSE/AEROSPACE - 0.8%
------------------------------------------- ------------------------------------------------
Honeywell Inc. 48,000 74,600 122,600 2,340,000 3,636,750 - 5,976,750
------------------------------------------- ------------------------------------------------
ELECTRICAL EQUIPMENT - 1.6%
Corning Inc. 36,000 36,000 - 2,106,000 - 2,106,000
Corvis Corp.(+) 9,900 9,900 - 285,244 - 285,244
Level 3 Communications, Inc.(+) 100,200 100,200 - 2,692,875 - 2,692,875
Nortel Networks Corp. 142,400 142,400 - 5,375,600 - 5,375,600
QUALCOMM Inc.(+) 12,500 12,500 - 1,003,125 - 1,003,125
------------------------------------------- ------------------------------------------------
- 301,000 - 301,000 - 11,462,844 - 11,462,844
------------------------------------------- ------------------------------------------------
ENVIRONMENTAL SERVICES - 0.5%
------------------------------------------- ------------------------------------------------
Waste Management, Inc. 139,757 139,757 - 3,345,433 - 3,345,433
------------------------------------------- ------------------------------------------------
HEAVY ELECTRICAL
EQUIPMENT - 0.4%
------------------------------------------- ------------------------------------------------
Cooper Industries, Inc. 71,600 71,600 - 2,922,175 - 2,922,175
------------------------------------------- ------------------------------------------------
INDUSTRIAL PARTS - 2.0%
------------------------------------------- ------------------------------------------------
Tyco International Ltd.(i)(s) 281,092 281,092 - 14,827,602 - 14,827,602
------------------------------------------- ------------------------------------------------
MACHINERY - 0.5%
Caterpillar, Inc. 60,000 60,000 2,358,750 - - 2,358,750
Dover Corp. 36,000 36,000 1,473,750 - - 1,473,750
------------------------------------------- ------------------------------------------------
96,000 - - 96,000 3,832,500 - - 3,832,500
------------------------------------------- ------------------------------------------------
MINING/METALS - 0.7%
Alcoa Inc. 40,400 61,764 102,164 1,138,775 1,740,973 - 2,879,748
Allegheny Technologies Inc. 110,186 110,186 - 2,189,947 - 2,189,947
------------------------------------------- ------------------------------------------------
40,400 171,950 - 212,350 1,138,775 3,930,920 - 5,069,695
------------------------------------------- ------------------------------------------------
OFFICE EQUIPMENT - 0.1%
------------------------------------------- ------------------------------------------------
Xerox Corp. 145,000 145,000 1,005,938 - - 1,005,938
------------------------------------------- ------------------------------------------------
PAPER PRODUCTS - 0.4%
International Paper Co. 35,100 35,100 1,189,013 - - 1,189,013
Weyerhaeuser Co. 37,000 37,000 1,618,750 - - 1,618,750
------------------------------------------- ------------------------------------------------
72,100 - - 72,100 2,807,763 - - 2,807,763
------------------------------------------- ------------------------------------------------
RAILROADS - 0.3%
------------------------------------------- ------------------------------------------------
Union Pacific Corp. 51,900 51,900 - 2,413,350 - 2,413,350
------------------------------------------- ------------------------------------------------
INSURANCE
LIFE & HEALTH INSURANCE - 1.3%
CIGNA Corp. 45,100 45,100 - 5,941,925 - 5,941,925
MetLife, Inc.(+) 118,600 118,600 - 3,513,525 - 3,513,525
------------------------------------------- ------------------------------------------------
- 163,700 - 163,700 - 9,455,450 - 9,455,450
------------------------------------------- ------------------------------------------------
PROPERTY AND CASUALTY
INSURANCE - 3.8%
Allstate Corp. 137,800 137,800 - 5,270,850 - 5,270,850
Ambac Financial Group, Inc. 83,400 83,400 - 6,369,675 - 6,369,675
American International
Group, Inc. 117,900 117,900 11,428,931 - - 11,428,931
XL Capital Ltd. Cl A(i) 57,300 57,300 - 4,573,256 - 4,573,256
------------------------------------------- ------------------------------------------------
117,900 278,500 - 396,400 11,428,931 16,213,781 - 27,642,712
------------------------------------------- ------------------------------------------------
PHARMACEUTICALS
DRUGS - 11.4%
Abbott Laboratories 82,000 82,000 4,515,125 - - 4,515,125
Alza Corp.(+) 125,200 125,200 - 5,555,750 - 5,555,750
American Home Products Corp. 55,000 62,300 117,300 3,306,875 3,745,788 - 7,052,663
Bristol-Myers Squibb Co. 61,700 61,700 - 4,276,581 - 4,276,581
Lilly (Eli) & Co. 35,000 88,500 123,500 3,279,063 8,291,344 - 11,570,407
Merck & Co., Inc. 64,900 64,900 - 6,015,419 - 6,015,419
See notes to Pro Forma Financial Statements
6
Pfizer, Inc.(s) 114,000 269,800 383,800 5,051,625 11,955,512 - 17,007,137
Pharmacia Corp. 115,213 181,675 296,888 7,027,993 11,082,175 - 18,110,168
Schering-Plough Corp. 153,600 153,600 - 8,611,200 - 8,611,200
------------------------------------------- ------------------------------------------------
401,213 1,007,675 - 1,408,888 23,180,681 59,533,769 - 82,714,450
------------------------------------------- ------------------------------------------------
RETAIL
CLOTHING STORES - 1.1%
Abercrombie & Fitch Co. Cl A(+) 102,400 102,400 - 2,137,600 - 2,137,600
Gap, Inc. (The) 110,400 110,400 - 2,753,100 - 2,753,100
TJX Companies, Inc. (The) 110,300 110,300 - 2,826,438 - 2,826,438
------------------------------------------- ------------------------------------------------
- 323,100 - 323,100 - 7,717,138 - 7,717,138
------------------------------------------- ------------------------------------------------
DEPARTMENT STORES - 2.4%
Kohls Corp. * 4,000 4,000 214,250 - - 214,250
Target Corp. 86,000 110,000 196,000 2,585,375 3,306,875 - 5,892,250
Wal-Mart Stores, Inc. 81,000 136,800 217,800 4,227,188 7,139,249 - 11,366,437
------------------------------------------- ------------------------------------------------
167,000 246,800 - 413,800 7,026,813 10,446,124 - 17,472,937
------------------------------------------- ------------------------------------------------
SPECIALTY STORES - 1.1%
Best Buy Co., Inc.(+) 56,100 56,100 - 1,444,575 - 1,444,575
Home Depot, Inc. 175,300 175,300 - 6,869,569 - 6,869,569
------------------------------------------- ------------------------------------------------
- 231,400 - 231,400 - 8,314,144 - 8,314,144
------------------------------------------- ------------------------------------------------
SEMICONDUCTORS
SEMICONDUCTORS - 4.0%
Altera Corp.(+) 39,500 39,500 - 945,531 - 945,531
Broadcom Corp.(+) 6,200 6,200 - 604,500 - 604,500
Intel Corp.(s) 50,000 243,500 293,500 1,903,125 9,268,219 - 11,171,344
Lattice Semiconductor Corp.(+) 2,400 2,400 - 39,900 - 39,900
Linear Technology Corp.(+) 36,700 36,700 - 1,736,369 - 1,736,369
Maxim Integrated Products,
Inc.(+) 35,000 35,000 - 1,785,000 - 1,785,000
Micron Technology, Inc.(+) 55,000 55,000 - 1,732,500 - 1,732,500
SDL, Inc.(+) 17,200 17,200 - 3,126,100 - 3,126,100
Sprint Corp. (PCS Group)(+) 114,600 114,600 - - - -
Texas Instruments Inc. 102,000 59,500 161,500 3,805,875 2,220,094 - 6,025,969
Xilinx, Inc.(+) 40,000 40,000 - 1,560,000 - 1,560,000
------------------------------------------- ------------------------------------------------
152,000 649,600 - 801,600 5,709,000 23,018,213 - 28,727,213
------------------------------------------- ------------------------------------------------
SOFTWARE & SERVICES
COMPUTER SOFTWARE - 6.8%
BEA Systems, Inc.(+) 40,200 40,200 - 2,354,213 - 2,354,213
Gemstar International
Group Ltd.(+) 85,100 85,100 - 3,462,506 - 3,462,506
International Business
Machines Corp. 44,300 23,800 68,100 4,142,050 2,225,300 - 6,367,350
Microsoft Corp.(s)(+) 276,000 276,000 - 15,835,500 - 15,835,500
NCR Corp.(+) 160,400 160,400 - 7,578,900 - 7,578,900
Oracle Corp.(+) 162,000 141,400 303,400 4,293,000 3,747,100 - 8,040,100
Parametric Technology Corp.(+) 135,200 135,200 - 1,504,100 - 1,504,100
Veritas Software Corp.(+) 41,078 41,078 - 4,007,672 - 4,007,672
------------------------------------------- ------------------------------------------------
- 41,078 - 41,078 8,435,050 40,715,291 - 49,150,341
------------------------------------------- ------------------------------------------------
INTERNET - 1.0%
Akamai Technologies, Inc.(+) 21,900 21,900 - 629,625 - 629,625
America Online, Inc.(+) 61,800 61,800 - 2,509,698 - 2,509,698
E*trade Group Inc.(+) 380,400 380,400 - 3,043,200 - 3,043,200
eBay Inc.(+) 18,000 18,000 - 617,625 - 617,625
------------------------------------------- ------------------------------------------------
- 482,100 - 482,100 - 6,800,148 - 6,800,148
------------------------------------------- ------------------------------------------------
TELECOMMUNICATIONS
TELECOMMUNICATIONS - 5.1%
AT&T Corp. 69,927 69,927 1,372,317 - - 1,372,317
BellSouth Corp. 55,000 55,000 2,299,688 - - 2,299,688
Motorola, Inc. 86,525 86,525 1,735,908 - - 1,735,908
Qwest Communications
International Inc.(+) 109,290 109,290 - 4,125,698 - 4,125,698
SBC Communications Inc.(s) 61,000 189,600 250,600 3,351,188 10,416,149 - 13,767,337
Verizon Communications 89,800 103,300 193,100 5,045,687 5,804,169 - 10,849,856
See notes to Pro Forma Financial Statements
7
WorldCom, Inc.(+) 113,450 113,450 - 1,694,659 - 1,694,659
------------------------------------------- ------------------------------------------------
362,252 515,640 - 877,892 13,804,788 22,040,675 - 35,845,463
------------------------------------------- ------------------------------------------------
WIRELESS TELECOMMUNICATIONS - 0.3%
Nextel Communications, Inc.(+) 72,500 72,500 - 2,247,500 - 2,247,500
Sprint Corp. (PCS Group) (+) 114,600 114,600 - 2,599,988 - 2,599,988
------------------------------------------- ------------------------------------------------
- 187,100 - 187,100 - 4,847,488 - 4,847,488
------------------------------------------- ------------------------------------------------
UTILITIES
ELECTRICAL UTILITY - 2.4%
Ameren Corp. 95,100 95,100 - 4,220,062 - 4,220,062
C P & L Energy Inc. 70,900 70,900 - 3,061,994 - 3,061,994
DTE Energy Company 72,800 72,800 - 2,761,850 - 2,761,850
Dynegy Inc. Cl A 68,300 68,300 - 3,022,275 - 3,022,275
Entergy Corp. 100,200 100,200 - 4,120,725 - 4,120,725
------------------------------------------- ------------------------------------------------
- 407,300 - 407,300 - 17,186,906 - 17,186,906
------------------------------------------- ------------------------------------------------
UTILITIES 1.2%
Dominion Resources, Inc. 20,300 20,300 1,218,000 - - 1,218,000
DQE, Inc. 41,000 41,000 1,417,063 - - 1,417,063
Duke Energy Corp. 28,000 28,000 2,518,250 - - 2,518,250
Enron Corp. 50,000 50,000 3,237,500 - - 3,237,500
------------------------------------------- ------------------------------------------------
139,300 - - 139,300 8,390,813 - - 8,390,813
------------------------------------------- ------------------------------------------------
SHORT-TERM INVESTMENTS - 4.4%
REPURCHASE AGREEMENTS - 1.6%
Greenwich Capital Markets,
Inc.,
Tri Party 6.55%
due 11/01/00 11,724,000 11,724,000 11,724,000 11,724,000
U.S. TREASURY SECURITIES - 0.3%
U.S. Treasury Notes, 5.25%,
5/31/01(s) 2,450,000 2,450,000 2,438,510 2,438,510
INVESTMENT COMPANIES - 2.5%
J.P. Morgan Institutional
Prime Money Market
Fund (a) 18,245,417 18,245,417 18,245,416 18,245,416
TOTAL INVESTMENTS - 100.0%
(COST $612,534,134) 197,588,033 527,057,247 - 724,645,280
================================================
FUTURES CONTRACTS - J.P. MORGAN PRO FORM COMBINED
UNDERLYING FACE UNREALIZED UNREALIZED
PURCHASED EXPIRATION DATE AMOUNT AT VALUE DEPRECIATION DEPRECIATION
45 S&P 500 Index December 2000 $ 14,866,875 $ (1,006,998) $ (1,006,998)
ADR American Depository Receipt
(a) Money Market mutual fund registered under the Investment Company Act of
1940, as amended, and advised by J.P. Morgan Investment, Inc.
(i) Foreign security
See notes to Pro Forma Financial Statements
8
(s) Security is fully or partially segregated with custodian as collateral
for futures or with brokers as initial margin for futures contracts.
(+) Non-income producing security.
The Portfolio may invest in one or more affiliated money market funds.
The Advisor has agreed to reimburse its advisory fee from the Portfolio
in an amount to offset any investment advisory, administrative fee and
shareholder servicing fees related to a Portfolio investment in an
affiliated money market fund.
(1) Subsequently renamed JPMorgan Large Cap Equity Fund
See notes to Pro Forma Financial Statements
9
JP MORGAN U.S. EQUITY FUND / JP MORGAN INSTITUTIONAL U.S. EQUITY FUND /
JP MORGAN U.S. EQUITY FUND - ADVISOR SERIES / THE U.S. EQUITY PORTFOLIO /
CHASE VISTA LARGE CAP FUND(1)
PRO FORMA COMBINING STATEMENT OF ASSETS & LIABILITIES
AS OF NOVEMBER 30, 2000
(UNAUDITED)
J.P. MORGAN J.P. MORGAN J.P. MORGAN U.S.
U.S. EQUITY INSTITUTIONAL U.S. EQUITY FUND - THE U.S. EQUITY
FUND EQUITY FUND ADVISOR SERIES PORTFOLIO
ASSETS
Investment in The U.S. Equity Portfolio, at value $344,117,718 $ 183,522,572 $ 493,577
Investments at Value - - - $527,057,247.00
Cash - - - 844,092
Dividend and Interest Receivable - - - 659,002
Receivable for Fund Shares Sold
Prepaid Trustees' Fees and Expenses 4,106 3,445 - 5,536
Receivable for Expense Reimbursements - - 12,235 -
Prepaid Expenses and Other Assets 946 709 - 2558
----------------------------------------------------------------------
TOTAL ASSETS 344,122,770 183,526,726 505,812 528,568,435
LIABILITIES
Advisory Fee Payable - - - 183,688
Variation Margin Payable - - - 155,250
Shareholder Servicing Fee Payable 75,082 15,837 - -
Distribution Fees - - - -
Registration Fees - - - -
Transfer Agent Fees - - - -
Administrative Services Fee Payable 7,124 3,757 - 10,894
Trustees' fees - - - -
Printing and postage - - - -
Professional Fees - - - -
Custodian fees - - - -
Payable for Shares of Beneficial Interest Redeemed - - - -
Fund Services Fee Payable 244 128 - 373
Administration Fee Payable 109 - - 621
Accrued Expenses and Other Liabilities 42,588 36,376 30,461 83,742
----------------------------------------------------------------------
TOTAL LIABILITIES 125,147 56,098 30,461 434,568
----------------------------------------------------------------------
NET ASSETS $343,997,623 $ 183,470,628 $ 475,351 $ 528,133,867
======================================================================
ANALYSIS OF NET ASSETS
Paid-in Capital $288,461,024 $ 141,861,487 $ 500,225 $ 0
Undistributed ( Distributions in excess of ) Net
Investment Income 653,902 597,017 261 -
Accumulated Net Realized Gain (Loss) on Investment 11,006,423 6,324,567 (6,149) -
Net Unrealized Appreciation (Depreciation) on Investment 43,876,274 34,687,557 (18,986) -
----------------------------------------------------------------------
NET ASSETS $343,997,623 $ 183,470,628 $ 475,351 $ 528,133,867
======================================================================
Shares of Beneficial Interest Outstanding 16,611,076 15,051,872 53,157 -
Shares Outstanding - - - -
Net Asset Value Per Share $ 20.71 $ 12.19 $ 8.94 $ -
PRO FORMA WITH CONCURRENT REORGANIZATION
JPMORGAN U.S. EQUITY FUND
Shares Outstanding
Class A - - - -
Class B - - - -
Class C - - - -
Select - - - -
Institutional - - - -
Net Asset Value Per Share
Class A - - - -
Class B - - - -
Class C - - - -
Select - - - -
Institutional - - - -
----------------------------------------------------------------------
Cost of Investments - - - $447,506,258
======================================================================
CHASE VISTA
LARGE CAP PRO FORMA PROFORMA
EQUITY FUND(1) ADJUSTMENTS COMBINED
ASSETS
Investment in The U.S. Equity Portfolio, at value $ (528,133,867)(a) $ -
Investments at Value $ 197,588,033 - 724,645,280
Cash 920 - 845,012
Dividend and Interest Receivable 329,696 - 988,698
Receivable for Fund Shares Sold 78,457 - 78,457
Prepaid Trustees' Fees and Expenses - - 13,087
Receivable for Expense Reimbursements - - 12,235
Prepaid Expenses and Other Assets - - 4,213
-------------------------------------------------------------
TOTAL ASSETS 197,997,106 (528,133,867) 726,586,982
LIABILITIES
Advisory Fee Payable 67,227 - 250,915
Variation Margin Payable - - 155,250
Shareholder Servicing Fee Payable 34,409 - 125,328
Distribution Fees 31,259 - 31,259
Registration Fees 30,784 - 30,784
Transfer Agent Fees 30,364 - 30,364
Administrative Services Fee Payable 8,403 - 30,178
Trustees' fees 29,932 - 29,932
Printing and postage 18,025 - 18,025
Professional Fees 11,566 - 11,566
Custodian fees 7,020 - 7,020
Payable for Shares of Beneficial Interest Redeemed 4,557 - 4,557
Fund Services Fee Payable - - 745
Administration Fee Payable 16,806 - 17,536
Accrued Expenses and Other Liabilities 3,372 - 196,539
-------------------------------------------------------------
TOTAL LIABILITIES 293,724 - 939,998
-------------------------------------------------------------
NET ASSETS $ 197,703,382 $ (528,133,867) $ 725,646,984
=============================================================
ANALYSIS OF NET ASSETS
Paid-in Capital $ 150,862,920 $ 0 $ 581,685,656
Undistributed ( Distributions in excess of ) Net
Investment Income (2,844,536) - ($1,593,356)
Accumulated Net Realized Gain (Loss) on Investment 17,124,842 - $ 34,449,683
Net Unrealized Appreciation (Depreciation) on Investment 32,560,156 - $ 111,105,001
-------------------------------------------------------------
NET ASSETS $ 197,703,382 $ (528,133,867) $ 725,646,984
=============================================================
Shares of Beneficial Interest Outstanding - (31,716,105)(b) -
Shares Outstanding 12,962,381 (12,962,381)(b) -
Net Asset Value Per Share $ 15.23(A)* - -
$ 15.11(B)*
$ 15.04(C)*
$ 15.30(I))*
PRO FORMA WITH CONCURRENT REORGANIZATION
JPMORGAN U.S. EQUITY FUND
Shares Outstanding
Class A - 5,013,616(c) 5,013,616
Class B - 2,207,306(c) 2,207,306
Class C - 153,915(c) 153,915
Select - 37,105,139(c) 37,105,139
Institutional - 15,051,872(c) 15,051,872
Net Asset Value Per Share
Class A - - $ 12.19
Class B - - $ 12.19
Class C - - $ 12.19
Select - - $ 12.19
Institutional - - $ 12.19
-------------------------------------------------------------
Cost of Investments $ 165,027,877 - $ 612,534,135
=============================================================
(a) Reallocation of investments from the feeder funds to the master portfolio.
(b) Reallocation of feeder fund's beneficial interest to Class A, Class B,
Class C, Select, and Institutional Shares due to the Concurrent
Reorganization.
* Share class of fund
(c) Reflects the additional number of shares outstanding due to the Concurrent
Reorganization.
(1) Subsequently renamed JPMorgan Large Cap Equity Fund.
See Notes to Pro Forma Financial Statements
-10-
J.P. MORGAN U.S. EQUITY FUND / J.P. MORGAN INSTITUTIONAL U.S. EQUITY FUND /
J.P. MORGAN U.S. EQUITY FUND - ADVISOR SERIES / THE U.S. EQUITY PORTFOLIO/
CHASE VISTA LARGE CAP EQUITY FUND(1)
PRO FORMA COMBINING STATEMENT OF OPERATIONS
FOR THE TWELVE MONTHS ENDED NOVEMBER 30, 2000
(UNAUDITED)
J.P. MORGAN U.S.
J.P. MORGAN J.P. MORGAN EQUITY FUND -
U.S. EQUITY INSTITUTIONAL U.S ADVISOR
EQUITY FUND EQUITY FUND SERIES
---------------------------------------------------------------
INCOME:
Allocated Investment Income From Portfolio 4,837,732 2,916,242 768
Dividend Income - -
Interest Income - - -
Dividend Income from Affiliated Investments - -
Allocated Portfolio Expenses (1,840,805) (1,110,537) (229)
--------------------------------------------------------------
Investment Income 2,996,927 1,805,705 539
--------------------------------------------------------------
EXPENSES:
Advisory Fee - - -
Shareholder Servicing Fee 995,379 240,314 175
Administrative Services Fee 96,491 58,277 -
Distribution Fee - - 120
Transfer Agent Fees 82,056 18,473 4,914
Custodian Fees and Expenses - - -
Registration Fees 23,213 24,416 11,042
Professional Fees 14,367 13,301 3,285
Financial and Fund Accounting Services Fee 15,041 15,041 6,095
Trustees' Fees and Expenses 5,498 3,128 124
Printing Expenses 10,376 5,584 2,421
Fund Services Fee 6,203 3,772 -
Administration Fee 4,413 2,668 -
Insurance Expense 497 123 -
Line of Credit Expense (2,362) (2,913) -
Miscellaneous 33,066 32,181 2,323
--------------------------------------------------------------
Total Expenses 1,284,238 414,365 30,499
--------------------------------------------------------------
Less: Amounts Waived
Less: Reimbursement of Expenses (69,360) (30,221)
--------------------------------------------------------------
Net Expenses 1,284,238 345,005 278
--------------------------------------------------------------
--------------------------------------------------------------
Net Investment Income 1,712,689 1,460,700 261
--------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net Realized gain (loss ) on:
Investment
Futures Contracts
Investment 17,273,605 12,510,427 (6,149)
Futures Contracts
Investment
Futures Contracts
--------------------------------------------------------------
NET REALIZED GAIN (LOSS) 17,273,605 12,510,427 (6,149)
--------------------------------------------------------------
Net Change in net unrealized appreciation
(depreciation) on
Investment (30,496,120) (17,066,424) (18,986)
Futures Contracts
--------------------------------------------------------------
NET CHANGE IN UNREALIZED DEPRECIATION (30,496,120) (17,066,424) (18,986)
--------------------------------------------------------------
--------------------------------------------------------------
NET DECREASE IN NET ASSETS FROM OPERATIONS (11,509,826) (3,095,297) (24,874)
==============================================================
THE U.S. EQUITY CHASE VISTA
PORTFOLIO LARGE CAP
EQUITY(1)
----------------------------------------
INCOME:
Allocated Investment Income From Portfolio -
Dividend Income 6,921,351 2,722,442
Interest Income 824,294 583,145
Dividend Income from Affiliated Investments 9,096 -
Allocated Portfolio Expenses -
---------------------------------------
Investment Income 7,754,741 3,305,587
---------------------------------------
EXPENSES:
Advisory Fee 2,542,291 937,829
Shareholder Servicing Fee - 586,266
Administrative Services Fee 154,901 353,707
Distribution Fee - 404,746
Transfer Agent Fees - 218,229
Custodian Fees and Expenses 175,789 83,970
Registration Fees - 22,831
Professional Fees 45,775 33,693
Financial and Fund Accounting Services Fee - -
Trustees' Fees and Expenses 8,150 11,785
Printing Expenses 257 22,159
Fund Services Fee 9,977 -
Administration Fee 4,493 -
Insurance Expense (1,285) -
Line of Credit Expense - -
Miscellaneous 10,320 14,303
---------------------------------------
Total Expenses 2,950,668 2,689,518
---------------------------------------
Less: Amounts Waived
Less: Reimbursement of Expenses - (748,110)
---------------------------------------
Net Expenses 2,950,668 1,941,408
---------------------------------------
---------------------------------------
Net Investment Income 4,804,073 1,364,179
---------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net Realized gain (loss ) on:
Investment
Futures Contracts
Investment 30,706,898 12,946,307
Futures Contracts (929,015)
Investment
Futures Contracts
---------------------------------------
NET REALIZED GAIN (LOSS) 29,777,883 12,946,307
---------------------------------------
Net Change in net unrealized appreciation
(depreciation) on
Investment (46,618,392) (12,915,903)
Futures Contracts (963,832)
---------------------------------------
NET CHANGE IN UNREALIZED DEPRECIATION (47,582,224) (12,915,903)
---------------------------------------
---------------------------------------
NET DECREASE IN NET ASSETS FROM OPERATIONS (13,000,268) 1,394,583
=======================================
PRO FORMA PRO FORMA
ADJUSTMENTS COMBINED
--------------------------------------------------
INCOME:
Allocated Investment Income From Portfolio (7,754,742) (a) -
Dividend Income - 9,643,793
Interest Income - 1,407,439
Dividend Income from Affiliated Investments - 9,096
Allocated Portfolio Expenses 2,951,571 (b) -
--------------------------------------------------
Investment Income (4,803,171) 11,060,328
--------------------------------------------------
EXPENSES:
Advisory Fee - 3,480,120
Shareholder Servicing Fee - 1,822,134
Administrative Services Fee 643,515 (d) 1,306,891
Distribution Fee 2,374 (d) 407,240
Transfer Agent Fees - 323,672
Custodian Fees and Expenses (100,240) (e) 159,519
Registration Fees - 81,502
Professional Fees (53,900) (f) 56,521
Financial and Fund Accounting Services Fee (36,177) (e) -
Trustees' Fees and Expenses - 28,685
Printing Expenses (20,500) (f) 20,297
Fund Services Fee - 19,952
Administration Fee - 11,574
Insurance Expense - (665)
Line of Credit Expense - (5,275)
Miscellaneous 92,193
--------------------------------------------------
Total Expenses 435,072 7,804,360
--------------------------------------------------
Less: Amounts Waived (435,072) (d) (435,072)
Less: Reimbursement of Expenses (274,160) (a) (1,121,851)
--------------------------------------------------
Net Expenses (274,160) 6,247,437
--------------------------------------------------
--------------------------------------------------
Net Investment Income (4,529,011) 4,812,891
--------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net Realized gain (loss ) on:
Investment
Futures Contracts
Investment (29,777,883) (c) 43,653,205
Futures Contracts (929,015)
Investment
Futures Contracts
--------------------------------------------------
NET REALIZED GAIN (LOSS) (29,777,883) 42,724,190
--------------------------------------------------
Net Change in net unrealized appreciation
(depreciation) on
Investment 47,581,530 (c) (59,534,295)
Futures Contracts (963,832)
--------------------------------------------------
NET CHANGE IN UNREALIZED DEPRECIATION 47,581,530 (60,498,127)
--------------------------------------------------
--------------------------------------------------
NET DECREASE IN NET ASSETS FROM OPERATIONS 13,274,636 (12,961,046)
==================================================
(a) Reallocation of investment income to feeder funds
(b) Reflects the elimination of master portfolio expenses which have been
disclosed under fund expenses.
(c) Reflects the elimination of realized and unrealized gain (loss) of the
feeder funds.
(d) Reflects the adjustments to investment advisory fee, administrative fees
and shareholder servicing fees and/or related waivers based on the
surviving fund's revised fee schedule.
(e) Custody fee includes all fund accounting charges, reflecting estimated
benefit of combined fund.
(f) Reduction reflects estimated benefits of combined funds.
(1) Subsequently renamed JPMorgan Large Cap Equity Fund.
See Notes to Pro Forma Financial Statements
-11-
THE U.S. EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
NOVEMBER 30, 2000
SHARES VALUE
- -------------------------------------------------------------------
COMMON STOCKS - 96.1%
CAPITAL MARKETS - 2.5%
SECURITIES & ASSET MANAGEMENT - 2.5%
119,700 Goldman Sachs Group, Inc. (The) $ 9,830,363
253,400 TD Waterhouse Group, Inc.+ 3,357,550
---------------
13,187,913
---------------
COMPUTER HARDWARE - 10.0%
COMPUTER HARDWARE & BUSINESS MACHINES - 10.0%
7,300 Avaya Inc.+ 85,319
414,800 Cisco Systems Inc.(s)+ 19,858,550
232,400 Compaq Computer Corp. 4,996,600
47,100 Dell Computer Corp.+ 906,675
104,500 EMC Corp. (Mass.)+ 7,772,188
69,600 Hewlett-Packard Co. 2,201,100
202,500 Quantum Corp. - DLT & Storage Systems+ 2,733,750
186,900 Sun Microsystems, Inc.(s)+ 14,216,081
---------------
52,770,263
---------------
CONSUMER CYCLICAL - 2.6%
HOTELS - 0.5%
58,700 Marriott International, Inc. 2,432,381
---------------
MOTOR VEHICLES & PARTS - 1.8%
66,400 Dana Corp. 1,112,200
167,500 Delphi Automotive Systems 2,313,594
93,492 Ford Motor Company 2,126,943
23,800 General Motors Corp. 1,178,100
129,800 Lear Corp.+ 2,839,375
---------------
9,570,212
---------------
RESTAURANTS - 0.3%
57,000 McDonald's Corp. 1,816,875
---------------
13,819,468
---------------
CONSUMER SERVICES - 2.9%
ENTERTAINMENT - 0.7%
76,900 Viacom, Inc. Cl B+ 3,931,512
---------------
MEDIA - 2.2%
104,200 AT&T Corp. - Liberty Media Group Cl A+ 1,413,213
40,758 Charter Communications, Inc.+ 804,971
93,800 Comcast Corp. Cl A+ 3,605,438
106,400 News Corp. Ltd. (The) ADR(i) 3,710,699
27,700 Time Warner Inc. 1,717,400
---------------
11,251,721
---------------
15,183,233
---------------
CONSUMER STABLE - 6.1%
HOME PRODUCTS - 4.0%
52,800 Clorox Company 2,359,500
62,700 Estee Lauder Companies, Inc. 2,715,694
SHARES VALUE
- -------------------------------------------------------------------
153,400 Gillette Company $ 5,196,425
142,000 Procter & Gamble Co. (The) 10,632,250
---------------
20,903,869
---------------
TOBACCO - 2.1%
295,300 Philip Morris Companies Inc. 11,276,769
---------------
32,180,638
---------------
ENERGY - 6.1%
ENERGY RESERVES & PRODUCTION - 4.7%
44,500 Anadarko Petroleum Corp. 2,647,750
37,900 Chevron Corp. 3,103,063
217,548 Exxon Mobil Corp.(s) 19,144,223
---------------
24,895,036
---------------
OIL REFINING - 0.3%
24,100 Texaco Inc. 1,399,306
---------------
OIL SERVICES - 1.1%
109,900 Baker Hughes Inc. 3,633,569
108,600 Global Marine Inc.+ 2,382,413
---------------
6,015,982
---------------
32,310,324
---------------
FINANCE - 11.4%
BANKS - 4.1%
223,100 Amsouth Bancorporation 3,318,613
81,566 Citigroup Inc. 4,063,006
103,000 First Union Corp. 2,587,875
608,000 Firstar Corp.(s) 11,780,000
---------------
21,749,494
---------------
FINANCIAL SERVICES - 6.8%
219,900 Associates First Capital Corp. 7,765,219
69,900 Capital One Financial Corp. 3,901,294
95,900 Countrywide Credit Industries, Inc. 3,560,288
43,100 Federal Home Loan Mortgage Corp. 2,604,856
331,700 General Electric Co. (U.S.)(s) 16,439,880
14,700 Providian Financial Corp. 1,323,000
---------------
35,594,537
---------------
THRIFTS - 0.5%
56,300 Washington Mutual, Inc. 2,558,131
---------------
59,902,162
---------------
HEALTH SERVICES & SYSTEMS - 1.5%
MEDICAL PRODUCTS & SUPPLIES - 1.5%
38,700 Bard (C.R.), Inc. 1,905,975
89,100 Becton Dickinson & Co. 3,029,400
53,200 Medtronic, Inc. 2,832,900
---------------
7,768,275
---------------
INDUSTRIAL CYCLICAL - 10.0%
CHEMICALS - 2.0%
205,300 Air Products & Chemicals, Inc. 7,070,019
The Accompanying Notes are an Integral Part of the Financial Statements. 13
THE U.S. EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
(Continued)
NOVEMBER 30, 2000
SHARES VALUE
- -------------------------------------------------------------------
112,700 Rohm and Haas Co. $ 3,352,825
---------------
10,422,844
---------------
DEFENSE/AEROSPACE - 0.7%
74,600 Honeywell Inc. 3,636,750
---------------
ELECTRICAL EQUIPMENT - 2.2%
36,000 Corning Inc. 2,106,000
9,900 Corvis Corp.+ 285,244
100,200 Level 3 Communications, Inc.+ 2,692,875
142,400 Nortel Networks Corp. 5,375,600
12,500 QUALCOMM Inc.+ 1,003,125
---------------
11,462,844
---------------
ENVIRONMENTAL SERVICES - 0.6%
139,757 Waste Management, Inc. 3,345,433
---------------
HEAVY ELECTRICAL EQUIPMENT - 0.6%
71,600 Cooper Industries, Inc. 2,922,175
---------------
INDUSTRIAL PARTS - 2.7%
281,092 Tyco International Ltd.(i)(s) 14,827,602
---------------
MINING & METALS - 0.7%
61,764 Alcoa Inc. 1,740,973
110,186 Allegheny Technologies Inc. 2,189,947
---------------
3,930,920
---------------
RAILROADS - 0.5%
51,900 Union Pacific Corp. 2,413,350
---------------
52,961,918
---------------
INSURANCE - 4.9%
LIFE & HEALTH INSURANCE - 1.8%
45,100 CIGNA Corp. 5,941,925
118,600 MetLife, Inc.+ 3,513,525
---------------
9,455,450
---------------
PROPERTY AND CASUALTY INSURANCE - 3.1%
137,800 Allstate Corp. 5,270,850
83,400 Ambac Financial Group, Inc. 6,369,675
57,300 XL Capital Ltd. Cl A(i) 4,573,256
---------------
16,213,781
---------------
25,669,231
---------------
PHARMACEUTICALS - 11.3%
DRUGS - 11.3%
125,200 Alza Corp.+ 5,555,750
62,300 American Home Products Corp. 3,745,788
61,700 Bristol-Myers Squibb Co. 4,276,581
88,500 Lilly (Eli) & Co. 8,291,344
64,900 Merck & Co., Inc. 6,015,419
269,800 Pfizer, Inc.(s) 11,955,512
181,675 Pharmacia Corp. 11,082,175
153,600 Schering-Plough Corp. 8,611,200
---------------
59,533,769
---------------
SHARES VALUE
- -------------------------------------------------------------------
RETAIL - 5.0%
CLOTHING STORES - 1.5%
102,400 Abercrombie & Fitch Co. Cl A+ $ 2,137,600
110,400 Gap, Inc. (The) 2,753,100
110,300 TJX Companies, Inc. (The) 2,826,438
---------------
7,717,138
---------------
DEPARTMENT STORES - 1.9%
110,000 Target Corp. 3,306,875
136,800 Wal-Mart Stores, Inc. 7,139,249
---------------
10,446,124
---------------
SPECIALTY STORES - 1.6%
56,100 Best Buy Co., Inc.+ 1,444,575
175,300 Home Depot, Inc. 6,869,569
---------------
8,314,144
---------------
26,477,406
---------------
SEMICONDUCTORS - 4.4%
SEMICONDUCTORS - 4.4%
39,500 Altera Corp.+ 945,531
6,200 Broadcom Corp.+ 604,500
243,500 Intel Corp.(s) 9,268,219
2,400 Lattice Semiconductor Corp.+ 39,900
36,700 Linear Technology Corp.+ 1,736,369
35,000 Maxim Integrated Products, Inc.+ 1,785,000
55,000 Micron Technology, Inc.+ 1,732,500
17,200 SDL, Inc.+ 3,126,100
59,500 Texas Instruments Inc. 2,220,094
40,000 Xilinx, Inc.+ 1,560,000
---------------
23,018,213
---------------
SOFTWARE & SERVICES - 9.0%
COMPUTER SOFTWARE - 7.7%
40,200 BEA Systems, Inc.+ 2,354,213
85,100 Gemstar International Group Ltd.+ 3,462,506
23,800 International Business Machines Corp. 2,225,300
276,000 Microsoft Corp.(s)+ 15,835,500
160,400 NCR Corp.+ 7,578,900
141,400 Oracle Corp.+ 3,747,100
135,200 Parametric Technology Corp.+ 1,504,100
41,078 Veritas Software Corp.+ 4,007,672
---------------
40,715,291
---------------
INTERNET - 1.3%
21,900 Akamai Technologies, Inc.+ 629,625
61,800 America Online, Inc.+ 2,509,698
380,400 E*trade Group Inc.+ 3,043,200
18,000 eBay Inc.+ 617,625
---------------
6,800,148
---------------
47,515,439
---------------
14 The Accompanying Notes are an Integral Part of the Financial Statements.
THE U.S. EQUITY PORTFOLIO
SCHEDULE OF INVESTMENTS (UNAUDITED)
- --------------------------------------------------------------------------------
(Continued)
NOVEMBER 30, 2000
SHARES/PRINCIPAL AMOUNT VALUE
- --------------------------------------------------------------------
TELECOMMUNICATIONS - 5.1%
TELEPHONE - 4.2%
109,290 Qwest Communications International Inc.+ $ 4,125,698
189,600 SBC Communications Inc.(s) 10,416,149
103,300 Verizon Communications 5,804,169
113,450 WorldCom, Inc.+ 1,694,659
---------------
22,040,675
---------------
WIRELESS TELECOMMUNICATIONS - 0.9%
72,500 Nextel Communications, Inc.+ 2,247,500
114,600 Sprint Corp. (PCS Group)+ 2,599,988
---------------
4,847,488
---------------
26,888,163
---------------
UTILITIES - 3.3%
ELECTRICAL UTILITY - 3.3%
95,100 Ameren Corp. 4,220,062
70,900 C P & L Energy Inc. 3,061,994
72,800 DTE Energy Company 2,761,850
68,300 Dynegy Inc. Cl A 3,022,275
100,200 Entergy Corp. 4,120,725
---------------
17,186,906
---------------
TOTAL COMMON STOCKS 506,373,321
---------------
(Cost $426,829,334)
SHORT-TERM INVESTMENTS - 3.9%
INVESTMENT COMPANIES - 3.4%
18,245,417 J.P. Morgan Institutional Prime Money
Market Fund(a) 18,245,416
---------------
U.S. TREASURY SECURITIES - 0.5%
$2,450,000 U.S. Treasury Notes, 5.25%, 5/31/01(s) 2,438,510
---------------
TOTAL SHORT-TERM INVESTMENTS 20,683,926
---------------
(Cost $20,676,924)
TOTAL INVESTMENT SECURITIES - 100.0% $ 527,057,247
===============
(Cost $447,506,258)
FUTURES CONTRACTS
UNDERLYING
FACE AMOUNT UNREALIZED
PURCHASED EXPIRATION DATE AT VALUE DEPRECIATION
- --------------------------------------------------------------------
45 S&P 500 Index December 2000 $14,866,875 $(1,006,998)
==============================
ADR - American Depositary Receipt
(a) Money Market mutual fund registered under the Investment Company Act of
1940, as amended, and advised by J.P. Morgan Investment Management, Inc.
(i) Foreign security
(s) Security is fully or partially segregated with custodian as collateral for
futures or with brokers as initial margin for futures contracts.
+ Non-income producing security.
The Accompanying Notes are an Integral Part of the Financial Statements. 15
JP MORGAN U.S. EQUITY FUND / JP MORGAN INSTITUTIONAL U.S. EQUITY FUND /
JP MORGAN U.S. EQUITY FUND - ADVISOR SERIES / THE U.S. EQUITY PORTFOLIO
Pro Forma Combining Statement of Assets & Liabilities
As of November 30, 2000
(Unaudited)
J.P. MORGAN U.S. J.P. MORGAN J.P. MORGAN
EQUITY FUND INSTITUTIONAL U.S. U.S. EQUITY FUND - THE U.S. EQUITY
EQUITY FUND ADVISOR SERIES PORTFOLIO
ASSETS
Investment in The U.S. Equity Portfolio
("Portfolio"), at vale $ 344,117,718 $ 183,522,572 $ 493,577 $ -
Investments at Value (Cost $447,506,258) - - - 527,057,247
Cash - - - 844,092
Dividends and Interest Receivable - - - 659,002
Prepaid Trustees' Fees and Expenses 4,106 3,445 - 5,536
Receivable for Expense Reimbursements - - 12,235 -
Prepaid Expenses and Other Assets 946 709 - 2,558
-----------------------------------------------------------------------------------
TOTAL ASSETS 344,122,770 183,526,726 505,812 528,568,435
LIABILITIES
Advisory Fee Payable - - - 183,688
Variation Margin Payable - - - 155,250
Shareholder Servicing Fee Payable 75,082 15,837 - 0
Administrative Services Fee Payable 7,124 3,757 - 10894
Fund Services Fee Payable 244 128 - 373
Administration Fee Payable 109 0 - 621
Accrued Expenses and Other Liabilities 42,588 36,376 30,461 83,742
-----------------------------------------------------------------------------------
TOTAL LIABILITIES 125,147 56,098 30,461 434,568
-----------------------------------------------------------------------------------
NET ASSETS $343,997,623 $183,470,628 $475,351 $528,133,867
===================================================================================
ANALYSIS OF NET ASSETS
Paid-in Capital $288,461,024 $141,861,487 $500,225 -
Undistributed Net Investment Income 653,902 597,017 261 -
Accumulated Net Realized Gain
(Loss) on Investment 11,006,423 6,324,567 (6,149) -
Net Unrealized Appreciation (Depreciation)
on Investment 43,876,274 34,687,557 (18,986) -
-----------------------------------------------------------------------------------
NET ASSETS $343,997,623 $183,470,628 $475,351 $528,133,867
===================================================================================
Shares of Beneficial Interest Outstanding 16,611,076 15,051,872 53,157 -
Net Asset Value Per Share 20.71 12.19 8.94 -
PRO FORMA WITH REORGANIZATION
JPMORGAN U.S. EQUITY FUND
Shares Outstanding
Class A Shares - - - -
Select Shares - - - -
Institutional Shares - - - -
Net Asset Value
Class A Shares - - -
Select Shares - - -
Institutional Shares - - -
=====================================================================
PROFORMA
COMBINED
PROFORMA JPMORGAN
ADJUSTMENTS U.S. EQUITY FUND
ASSETS
Investment in The U.S. Equity Portfolio
("Portfolio"), at vale $ (528,133,867) (a) $ -
Investments at Value (Cost $447,506,258) - 527,057,247
Cash - 844,092
Dividends and Interest Receivable - 659,002
Prepaid Trustees' Fees and Expenses - 13,087
Receivable for Expense Reimbursements - 12,235
Prepaid Expenses and Other Assets - 4,213
----------------------------------------------
TOTAL ASSETS (528,133,867) 528,589,876
LIABILITIES
Advisory Fee Payable - 183,688
Variation Margin Payable - 155,250
Shareholder Servicing Fee Payable - 90,919
Administrative Services Fee Payable - 21,775
Fund Services Fee Payable - 745
Administration Fee Payable - 730
Accrued Expenses and Other Liabilities - 193,167
----------------------------------------------
TOTAL LIABILITIES - 646,274
----------------------------------------------
NET ASSETS $ (528,133,867) $ 527,943,602
==============================================
ANALYSIS OF NET ASSETS
Paid-in Capital - $430,822,736
Undistributed Net Investment Income - 1,251,180
Accumulated Net Realized Gain
(Loss) on Investment - 17,324,841
Net Unrealized Appreciation (Depreciation)
on Investment - 78,544,845
----------------------------------------------
NET ASSETS $ (528,133,867) $527,943,602
==============================================
Shares of Beneficial Interest Outstanding (31,716,105)(b) -
Net Asset Value Per Share - -
PRO FORMA WITH REORGANIZATION
JPMORGAN U.S. EQUITY FUND
Shares Outstanding
Class A Shares 38,998 (c) 38,998
Select Shares 28,221,456 (c) 28,221,456
Institutional Shares 15,051,872 (c) 15,051,872
Net Asset Value
Class A Shares - $ 12.19
Select Shares - $ 12.19
Institutional Shares - $ 12.19
==============================================
(a) Reallocation of investments from the feeder funds to
the master portfolio
(b) Reallocation of feeder fund's beneficial interest to
Class A, Institutional, and Select Shares due to the
Reorganization
(c) Reflects the additional number of shares outstanding
due to the Reorganization
12
JP MORGAN U.S. EQUITY FUND / JP MORGAN INSTITUTIONAL U.S. EQUITY FUND /
JP MORGAN U.S. EQUITY FUND - ADVISOR SERIES /
THE U.S. EQUITY PORTFOLIO
PRO FORMA COMBINING STATEMENT OF OPERATIONS
FOR THE TWELVE MONTHS ENDED NOVEMBER 30, 2000
(UNAUDITED)
J.P. MORGAN U.S. J.P. MORGAN
EQUITY FUND INSTITUTIONAL U.S.
EQUITY FUND
INCOME:
Allocated Investment Income From Portfolio $ 4,837,732 $ 2,916,242
Interest Income - -
Dividend Income from Affiliated Investments -
Dividend Income - -
Allocated Portfolio Expenses (1,840,805) (1,110,537)
-----------------------------------------------
Investment Income 2,996,927 1,805,705
===============================================
EXPENSES:
Advisory Fee - -
Shareholder Servicing Fee 995,379 240,314
Administrative Services Fee 96,491 58,277
Custodian Fees and Expenses - -
Transfer Agent Fees 82,056 18,473
Registration Fees 23,213 24,416
Professional Fees 14,367 13,301
Financial and Fund Accounting Services Fee 15,041 15,041
Fund Services Fee 6,203 3,772
Trustees' Fees and Expenses 5,498 3,128
Administration Fee 4,413 2,668
Printing Expenses 10,376 5,584
Distribution Fee - -
Insurance Expense 497 123
Line of Credit Expense (2,362) (2,913)
Miscellaneous 33,066 32,181
-----------------------------------------------
Total Expenses 1,284,238 414,365
-----------------------------------------------
Less: Amounts Waived
Less: Reimbursement of Expenses (69,360)
-----------------------------------------------
Net Expenses 1,284,238 345,005
-----------------------------------------------
-----------------------------------------------
Net Investment Income 1,712,689 1,460,700
===============================================
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
NET REALIZED GAIN (LOSS) ON:
Investment 17,273,605 12,510,427
Futures Contracts
-----------------------------------------------
NET REALIZED GAIN (LOSS) 17,273,605 12,510,427
-----------------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:
Investment (30,496,120) (17,066,424)
Futures Contracts
-----------------------------------------------
Net Change in net unrealized depreciation (30,496,120) (17,066,424)
-----------------------------------------------
-----------------------------------------------
NET DECREASE IN NET ASSETS FROM OPERATIONS $ (11,509,826) $ (3,095,297)
===============================================
J.P. MORGAN
U.S. EQUITY FUND - THE U.S. EQUITY
ADVISOR SERIES PORTFOLIO
INCOME:
Allocated Investment Income From Portfolio $ 768 $ -
Interest Income - 824,294
Dividend Income from Affiliated Investments - 9,096
Dividend Income - 6,921,351
Allocated Portfolio Expenses (229) -
-------------------------------------------
Investment Income 539 7,754,741
===========================================
EXPENSES:
Advisory Fee - 2,542,291
Shareholder Servicing Fee 175 -
Administrative Services Fee - 154,901
Custodian Fees and Expenses - 175,789
Transfer Agent Fees 4,914 -
Registration Fees 11,042 -
Professional Fees 3,285 45,775
Financial and Fund Accounting Services Fee 6,095 -
Fund Services Fee - 9,977
Trustees' Fees and Expenses 124 8,150
Administration Fee - 4,493
Printing Expenses 2,421 257
Distribution Fee 120 -
Insurance Expense - (1,285)
Line of Credit Expense - -
Miscellaneous 2,323 10,320
-------------------------------------------
Total Expenses 30,499 2,950,668
-------------------------------------------
Less: Amounts Waived
Less: Reimbursement of Expenses (30,221) -
-------------------------------------------
Net Expenses 278 2,950,668
-------------------------------------------
-------------------------------------------
Net Investment Income 261 4,804,073
===========================================
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
NET REALIZED GAIN (LOSS) ON:
Investment (6,149) 30,706,898
Futures Contracts (929,015)
-------------------------------------------
NET REALIZED GAIN (LOSS) (6,149) 29,777,883
-------------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON:
Investment (18,986) (46,618,392)
Futures Contracts (963,832)
-------------------------------------------
Net Change in net unrealized depreciation (18,986) (47,582,224)
-------------------------------------------
-------------------------------------------
NET DECREASE IN NET ASSETS FROM OPERATIONS $ (24,874) $ (13,000,268)
===========================================
PROFORMA
COMBINED
PROFORMA JPMORGAN
ADJUSTMENTS U.S. EQUITY FUND
INCOME:
Allocated Investment Income From Portfolio $ (7,754,742) (a) $ -
Interest Income - 824,294
Dividend Income from Affiliated Investments - 9,096
Dividend Income - 6,921,351
Allocated Portfolio Expenses 2,951,571 (b) -
-----------------------------------------
Investment Income (4,803,171) 7,754,741
=========================================
EXPENSES:
Advisory Fee - 2,542,291
Shareholder Servicing Fee - 1,235,868
Administrative Services Fee 646,002 (d) 955,671
Custodian Fees and Expenses (16,270) (e) 159,519
Transfer Agent Fees - 105,443
Registration Fees - 58,671
Professional Fees (23,900) (f) 52,828
Financial and Fund Accounting Services Fee (36,177) (e) -
Fund Services Fee - 19,952
Trustees' Fees and Expenses - 16,900
Administration Fee - 11,574
Printing Expenses (10,500) (f) 8,138
Distribution Fee 490 (d) 610
Insurance Expense - (665)
Line of Credit Expense - (5,275)
Miscellaneous 77,890
-----------------------------------------
Total Expenses 559,645 5,239,415
-----------------------------------------
Less: Amounts Waived (559,645) (d) (559,645)
Less: Reimbursement of Expenses (99,581)
-----------------------------------------
-
Net Expenses - 4,580,189
-----------------------------------------
-
-----------------------------------------
Net Investment Income (4,803,171) 3,174,552
=========================================
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
NET REALIZED GAIN (LOSS) ON:
Investment (29,777,883) (c) 30,706,898
Futures Contracts (929,015)
-----------------------------------------
NET REALIZED GAIN (LOSS) (29,777,883) 29,777,883
-----------------------------------------
NET CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) ON: -
Investment 47,581,530 (c) (46,618,392)
Futures Contracts (963,832)
-----------------------------------------
Net Change in net unrealized depreciation 47,581,530 (47,582,224)
-----------------------------------------
-
-
-----------------------------------------
NET DECREASE IN NET ASSETS FROM OPERATIONS $ 13,000,476 $ (14,629,789)
=========================================
(a) Reallocation of investment income to feeder funds.
(b) Reflects the elimination of master portfolio expenses which
have been disclosed under fund expenses.
(c) Reflects the elimination of master portfolio expenses which
have been disclosed under fund expenses.
(d) Reflects adjustments to investment advisory fee,
administrative fees and shareholder servicing fees and/or
related waivers based on the surviving Fund's revised fee
schedule.
(e) Custody fee includes all fund accounting charges, reflecting
estimated benefit of combined fund.
(f) Reduction reflects estimated benefits of combined funds.
13
J.P. MORGAN INSTITUTIONAL U.S. EQUITY FUND / J.P. MORGAN U.S EQUITY FUND /
J.P. MORGAN U.S. EQUITY FUND - ADVISOR SERIES / THE U.S. EQUITY PORTFOLIO /
CHASE VISTA LARGE CAP EQUITY FUND
NOTES TO PRO FORMA FINANCIAL STATEMENTS
(UNAUDITED)
1. BASIS OF COMBINATION:
The Pro Forma Combining Statement of Assets and Liabilities, Statement
of Operations and Schedule of Investments ("Pro Forma Statements") reflect
the accounts of The U.S. Equity Portfolio ("Master Portfolio"), J.P. Morgan
Institutional U.S. Equity Fund ("Institutional Fund"), J.P. Morgan U.S.
Equity Fund ("U.S. Equity Fund") and J.P. Morgan U.S. Equity Fund - Advisor
Series ("Advisor Series Fund") (collectively the "feeder funds" of the Master
Portfolio) as if the proposed Reorganization occurred as of and for the
twelve months ended November 30, 2000.
The Pro Forma Combining Statement of Assets and Liabilities, Statement
of Operations and Schedule of Investments ("Pro Forma Statements") reflect
the accounts of the Master Portfolio, the feeder funds, and Chase Vista Large
Cap Equity Fund ("CVLCE") (renamed JPMorgan Large Cap Equity Fund) as if the
proposed Concurrent Reorganization occurred as of and for the twelve months
ended November 30, 2000.
2. SHARES OF BENEFICIAL INTEREST:
Under the Reorganization, the existing shares of Institutional Fund,
U.S. Equity Fund, and Advisor Series Fund would be renamed Institutional
Shares, Select Shares, and Class A Shares, respectively. The net asset values
per share for Select Shares and Class A Shares at the commencement of
offering would be identical to the closing net asset value per share for the
Institutional Shares immediately prior to the Reorganization.
Under the Concurrent Reorganization, the existing shares of
Institutional Fund, U.S. Equity Fund, and Advisor Series Fund would be
renamed Institutional Shares, Select Shares, and Class A Shares, respectively
and would commence offering Class B and Class C Shares. The net asset values
per share for Select Shares, Class A Shares, Class B Shares, and Class C
Shares at the commencement of offering would be identical to the closing net
asset value per share for the Institutional Shares immediately prior to the
Reorganization.
Under the proposed Reorganization, each shareholder of U.S Equity Fund
and Advisor Series Fund would receive shares of Institutional Fund with a
value equal to their holdings in their respective funds. Holders of U.S
Equity Fund will receive Select Shares and holders of the Advisor Series Fund
will receive Class Shares in Institutional Fund. Therefore, as a result of
the proposed Reorganization, current shareholders of U.S. Equity Fund and
Advisor Series Fund will become shareholders of Institutional Fund.
Under the proposed Concurrent Reorganization, each shareholders of
U.S. Equity Fund, Advisor Series Fund, and CVLCE would receive shares of
Institutional Fund with a value equal to their holdings in their respective
funds. Holders of U.S. Equity Fund will receive Select
14
Shares, holders of the Advisor Series Fund will receive Class A Shares,
holders of Class A Shares in CVLCE will receive Class A Shares, holders of
Class B Shares in CVLCE will receive Class B Shares, holders of Class C
Shares in CVLCE will receive Class C Shares, and holders of Class I Shares in
CVLCE will receive Select Shares in Institutional Fund. Therefore, as a
result of the proposed Concurrent Reorganization, current shareholders of
U.S. Equity Fund, Advisor Series Fund, and CVLCE will become shareholders of
Institutional Fund.
The Pro Forma net asset value per share assumes the issuance of
additional shares of Institutional Fund, which would have been issued on
November 30, 2000 in connection with the proposed Reorganization and the
proposed Concurrent Reorganization. The amount of additional shares assumed
to be issued under the Reorganization was calculated based on the November
30, 2000 net assets of U.S. Equity Fund and Advisor Series Fund and the net
asset values per share of Institutional Fund. The amount of additional shares
assumed to be issued under the Concurrent Reorganization was calculated based
on the November 30, 2000 net assets of U.S. Equity Fund, Advisor Series Fund,
and CVLCE and the net asset value per share of Institutional Fund.
J.P. MORGAN U.S. EQUITY FUND WITH REORGANIZATION
CLASS A SHARES SELECT SHARES
-------------- -------------
Increase in Shares Issued 38,998 28,221,456
Net Assets 11/30/00 475,351 343,997,623
Pro Forma Net Asset Value 11/30/00 12.19 12.19
J.P. MORGAN U.S. EQUITY FUND WITH CONCURRENT REORGANIZATION
CLASS A CLASS B CLASS C SELECT
------- ------- ------- ------
Increase in Shares Issued 5,013,616 2,207,306 153,915 37,105,139
Net Assets 11/30/00 61,112,083 26,905,349 1,876,106 452,282,818
Pro Forma Net Asset Value 11/30/00 12.19 12.19 12.19 12.19
3. PRO FORMA OPERATIONS:
The Pro Forma Statement of Operations assumes similar rates of gross
investment income for the investments of each Fund. Accordingly, the combined
gross investment income is equal to the sum of each Fund's gross investment
income. Certain expenses have been adjusted to reflect the expected expenses of
the combined entity including the change in administration fee and the new
expense cap. The pro forma investment advisory, shareholder servicing and
distribution fees of the combined Fund are based on the fee schedule in effect
for Surviving Fund at the combined level of average net assets for the twelve
months ended November 30, 2000.
15
FORM N-14
PART C OTHER INFORMATION
Item 15. Indemnification.
------------------
Reference is made to Section 5.3 of Registrant's Declaration of Trust and
Section 5 of Registrant's Distribution Agreement.
Registrant, its Trustees and officers are insured against certain
expenses in connection with the defense of claims, demands, actions, suits, or
proceedings, and certain liabilities that might be imposed as a result of such
actions, suits or proceedings.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended (the "1933 Act"), may be permitted to directors,
trustees, officers and controlling persons of the Registrant and the principal
underwriter pursuant to the foregoing provisions or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the 1933 Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, trustee, officer, or controlling person of the
Registrant and the principal underwriter in connection with the successful
defense of any action, suit or proceeding) is asserted against the Registrant by
such director, trustee, officer or controlling person or principal underwriter
in connection with the shares being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the 1933 Act and
will be governed by the final adjudication of such issue.
Item 16. Exhibits.
------------------
1 Declaration of Trust.
(a) Declaration of Trust, as amended, was filed as Exhibit No. 1 to
Post-Effective Amendment No. 25 to the Registrant's Registration Statement on
Form N-1A (File No. 033-54642) (the "Registration Statement") filed on September
26, 1996 (Accession Number 0000912057-96-021281).
(f) Amendment No. 5 to Declaration of Trust; Amendment and Fifth
Amended and Restated Establishment and Designation of Series of Shares of
Beneficial Interest. Incorporated
Part C-1
herein by reference to Post-Effective Amendment No. 29 to the Registration
Statement filed on December 26, 1996 (Accession Number 0001016964-96-000061).
(g) Amendment No. 6 to Declaration of Trust; Amendment and Sixth
Amended and Restated Establishment and Designation of Series of Shares of
Beneficial Interest was filed as Exhibit No. 1(b) to Post-Effective Amendment
No. 31 to the Registration Statement on February 28, 1997 (Accession Number
0001016964-97-000041).
(h) Amendment No. 7 to Declaration of Trust; Amendment and Seventh
Amended and Restated Establishment and Designation of Series of Shares of
Beneficial Interest was filed as Exhibit No. 1(c) to Post-Effective Amendment
No. 32 to the Registration Statement on April 15, 1997 (Accession Number
0001016964-97-000053).
(i) Amendment No. 8 to Declaration of Trust; Amendment and Eighth
Amended and Restated Establishment and Designation of Series of Shares of
Beneficial Interest was filed as Exhibit No. l(d) to Post-Effective Amendment
No. 40 to the Registration Statement on October 9, 1997 (Accession Number
0001016964-97-000158).
(j) Amendment No. 9 to Declaration of Trust; Amendment and Ninth
Amended and Restated Establishment and Designation of Series of Shares of
Beneficial Interest was filed as Exhibit No. l(e) to Post-Effective Amendment
No. 50 to the Registration Statement on December 29, 1997 (Accession Number
0001041455-97-000014).
(k) Amendment No. 10 to Declaration of Trust; Amendment and Tenth
Amended and Restated Establishment and Designation of Series of Shares of
Beneficial Interest and change voting procedures to dollar-based voting was
filed as Exhibit No. (a)6 to Post-Effective Amendment No. 60 to the Registration
Statement on December 31, 1998 (Accession Number 0001041455-98-000097).
(l) Amendment No. 11 to Declaration of Trust. Incorporated herein by
reference to Post-Effective Amendment No. 63 to the Registration Statement filed
on April 29, 1999 (Accession Number 00001041455-99-000041).
(m) Amendment No. 12 to Declaration of Trust. Incorporated herein by
reference to Post-Effective Amendment No. 72 to the Registration Statement filed
on April 3, 2000 (Accession Number 0001041455-00-000084).
(n) Amendment No. 13 to Declaration of Trust, incorporated herein by
reference to Post-Effective Amendment No. 78 to the Registration Statement filed
on August 1, 2000 (Accession Number 0000894088-00-000008).
(o) Amendment No.14 to Declaration of Trust incorporated herein by
reference to Post-Effective Amendment No. 78 to the Registration Statement filed
on August 1, 2000 (Accession Number 0000894088-00-000008).
Part C-2
2 By-laws.
(a) Restated By-Laws of Registrant. Incorporated herein by reference
to Post-Effective Amendment No. 29 to the Registration Statement filed on
December 26, 1996 (Accession Number 0001016964-96-000061).
(b) Amendment to Restated By-laws of Registrant. Incorporated herein
by reference to Post-Effective Amendment No. 71 to the Registration Statement
filed on February 28, 2000 (Accession Number 0001041455-00-000056).
3 Not Applicable
4 Agreement and Plan of Reorganization filed herewith as Appendix A
to the Combined Prospectus/Proxy Statement.
5 Not Applicable
6 Form of Investment Advisory Agreement to be filed by Amendment.
7 Distribution Agreement to be filed by Amendment.
8 Not Applicable
9 Custodian Agreement
(a) Custodian Contract between Registrant and State Street Bank and
Trust Company ("State Street"). Incorporated herein by reference to
Post-Effective Amendment No. 29 to the Registration Statement filed on December
26, 1996 (Accession Number 0001016964-96-000061).
(b) Custodian Contract between Registrant and The Bank of New York.
Incorporated herein by reference to Post-Effective Amendment No. 71 to the
Registration Statement filed on February 28, 2000 (Accession Number
0001041455-00-000056).
10 Forms of Rule 12b1 Distribution Plans to be filed by Amendment.
11 Opinion and Consent of Nixon Peabody LLP as to legality of shares
to be filed by Amendment.
12 Opinion and Consent of Simpson Thacher & Bartlett as to Tax
Consequences to be filed by Amendment.
13 Material Contracts.
(a) Co-Administration Agreement between Registrant and FDI.
Incorporated herein by reference to Post-Effective Amendment No. 29 to the
Registration Statement filed on December 26, 1996 (Accession Number
0001016964-96-000061).
Part C-3
(b) Restated Shareholder Servicing Agreement between Registrant and
Morgan Guaranty Trust Company of New York ("Morgan Guaranty") filed as Exhibit
(h)2 to Post Effective Amendment No. 54 to the Registration Statement on August
25, 1998 (Accession No. 0001041455-98-000053).
(c) Transfer Agency and Service Agreement between Registrant and State
Street. Incorporated herein by reference to Post-Effective Amendment No. 29 to
the Registration Statement filed on December 26,1996 (Accession Number
0001016964-96-000061).
(d) Restated Administrative Services Agreement between Registrant and
Morgan Guaranty. Incorporated herein by reference to Post-Effective Amendment
No. 29 to the Registration Statement filed on December 26, 1996 (Accession
Number 0001016964-96-000061).
(e) Fund Services Agreement, as amended, between Registrant and
Pierpont Group, Inc. Incorporated herein by reference to Post-Effective
Amendment No. 29 to the Registration Statement filed on December 26, 1996
(Accession Number 0001016964-96-000061).
(f) Service Plan with respect to Registrant's Service Money Market
Funds. Incorporated herein by reference to Post-Effective Amendment No. 33 to
the Registration Statement filed on April 30, 1997 (Accession Number
00001016964-97-000059).
(g) Service Plan with respect to Registrant's Small Company Fund
Advisor Series, Small Company Opportunities Fund-Advisor Series, International
Equity Fund-Advisor Series, International Opportunities Fund-Advisor Series,
U.S. Equity Fund-Advisor Series, Diversified Fund-Advisor Series incorporated
herein by reference to Post-Effective Amendment No. 78 to the Registration
Statement filed on August 1, 2000 (Accession Number 0000894088-00-000008).
(h) Amended Service Plan with respect to Registrant's Disciplined
Equity-Advisor series and Direct Prime Money Market Funds. Incorporated herein
by reference to Post-Effective Amendment No. 72 to the Registration Statement
filed on April 3, 2000 (Accession Number 0001041455-00-000084).
(i) Amended Service Plan with respect to Registrant's J.P. Morgan
Prime Cash Management Fund. Incorporated herein by reference to Post-Effective
Amendment No. 75 to Registration Statement filed on May 17, 2000 (Accession
Number 0001041455-00-000122).
(j) Form of Administration Agreement (to be filed by Amendment)
(k) Form of Sub-Administration Agreement (to be filed by Amendment)
14 Consent of PricewaterhouseCoopers LLP.
15 None
16 Powers of Attorney.
Part C-4
17(a) Form of Proxy Card.
17(b) Prospectus for the Surviving Fund to be filed by Amendment.
17(c) Prospectus for the Merging Fund.
17(d) Statement of Additional Information for the Surviving Fund to be
filed by Amendment.
17(e) Statement of Additional Information for the Merging Fund.
17(f) Annual Report of the Surviving Fund (including the Annual Report
of the Master Portfolio), dated May 31, 2000.
17(g) Semi-Annual Report of the Surviving Fund (including the
Semi-Annual Report of the Master Portfolio), dated November 30,
2000.
17(h) Annual Report of the Merging Fund (including the Annual Report of
the Master Portfolio), dated May 31, 2000 (to be filed by
Amendment).
17(i) Semi-Annual Report of the Merging Fund (including the Semi-Annual
Report of the Master Portfolio), dated November 30, 2000.
Item 17. Undertakings.
----------------
(1) The undersigned Registrant agrees that prior to any public
reoffering of the securities registered through the use of a prospectus which is
part of this registration statement by any person or party who is deemed to be
an underwriter within the meaning of Rule 145(c) of the Securities Act of 1933,
as amended (the "1933 Act"), the reoffering prospectus will contain the
information called for by the applicable registration form for reofferings by
persons who may be deemed underwriters, in addition to the information called
for by the other items of the applicable form.
(2) The undersigned Registrant agrees that every prospectus that is
filed under paragraph (1) above will be filed as part of an amendment to the
registration statement and will not be used until the amendment is effective,
and that, in determining any liability under the 1933 Act, each post-effective
amendment shall be deemed to be a new registration statement for the securities
offered therein, and the offering of the securities at that time shall be deemed
to be the initial bona fide offering of them.
Part C-5
SIGNATURES
As required by the Securities Act of 1933, this registration statement
has been signed on behalf of the registrant, in the City of New York and the
State of New York, on the 9th day of April, 2001.
J.P. MORGAN INSTITUTIONAL FUNDS
Registrant
By: /s/ Christopher Kelley
--------------------------------
Christopher Kelley
Vice President and Assistant Secretary
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities indicated on April 12, 2001.
George Rio*
- ---------------------------------------
George Rio
President and Treasurer
Matthew Healey*
- ---------------------------------------
Matthew Healey
Trustee, Chairman and Chief Executive Officer (Principal Executive Officer)
Frederick S. Addy*
- ---------------------------------------
Frederick S. Addy
Trustee
William G. Burns*
- ---------------------------------------
William G. Burns
Trustee
Arthur C. Eschenlauer*
- ---------------------------------------
Arthur C. Eschenlauer
Trustee
Michael P. Mallardi*
- ---------------------------------------
Michael P. Mallardi
Trustee
*By /s/ Christopher Kelley
- ---------------------------------------
Christopher Kelley
as attorney-in-fact pursuant to a power of attorney.
EXHIBITS
ITEM DESCRIPTION
(14) Consent of PricewaterhouseCoopers LLP.
(16) Powers of Attorney.
(17) (a) Form of Proxy Card.
(c) Prospectus for the J.P. Morgan U.S. Equity Fund-Advisor Series.
(e) Statement of Additional Information for J.P. Morgan U.S. Equity
Fund-Advisor Series.
(f) Annual Report of J.P. Morgan Institutional U.S. Equity Fund
(including Annual Report of The U.S. Equity Portfolio), dated May
31, 2000.
(g) Semi-Annual Report of J.P. Morgan Institutional U.S. Equity Fund
(including Semi-Annual Report of The U.S. Equity Portfolio), dated
November 30, 2000.
(i) Semi-Annual Report of J.P. Morgan U.S. Equity Fund-Advisor Series
(including Semi-Annual Report of The U.S. Equity Portfolio), dated
November 30, 2000.