-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CcVQMaUMISQJshJDpHWY5qJSH8XPsSxpE+kT70IP3s98P4eikfEDuXjiEeig6qFd l1BpHcjgg9G9eQcqXA4wuw== 0000912057-01-508846.txt : 20010417 0000912057-01-508846.hdr.sgml : 20010417 ACCESSION NUMBER: 0000912057-01-508846 CONFORMED SUBMISSION TYPE: N-14 PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 20010416 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MUTUAL FUND TRUST CENTRAL INDEX KEY: 0000919034 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: MA FISCAL YEAR END: 0831 FILING VALUES: FORM TYPE: N-14 SEC ACT: SEC FILE NUMBER: 333-59000 FILM NUMBER: 1602848 BUSINESS ADDRESS: STREET 1: 1 CHASE MANHATTAN PLAZA STREET 2: 3RD FLOOR CITY: NEW YORK STATE: NY ZIP: 10081 MAIL ADDRESS: STREET 1: ONE CHASE SQUARE 7TH FLOOR CITY: ROCHESTER STATE: NY ZIP: 14643 N-14 1 a2044397zn-14.txt N-14 As filed with the Securities and Exchange Commission on April 16, 2001 Registration No. 333-___/811-8358 ================================================================================ 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: MUTUAL FUND TRUST Area Code and Telephone Number: (212) 492-1600 Address of Principal Executive Offices: 1211 Avenue of the Americas, 41st Floor New York, New York 10036 Name and Address of Agent for Service: Lisa Hurley c/o BISYS Fund Services, Inc. 3435 Stelzer Road Columbus, Ohio 43219 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 16, 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. 033-75250/811-8358) 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 August 31, 2000 was filed on November 27, 2000. Pursuant to Rule 429, this Registration Statement relates to the aforesaid Registration Statement on Form N-1A. J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND A SERIES OF J.P. MORGAN INSTITUTIONAL FUNDS 60 STATE STREET, SUITE 1300 BOSTON, MASSACHUSETTS 02109 May 16, 2001 Dear Shareholder: A special meeting of the shareholders of J.P. Morgan Institutional Service Federal Money Market Fund (the "Merging Fund"), a series of J.P. Morgan Institutional Funds ("JPMIF"), 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, J.P. Morgan & Co. Incorporated, the former corporate parent of the investment adviser of the Merging Fund's assets, recently completed a merger with The Chase Manhattan Corporation 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 in order to provide better service for shareholders of 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 Federal Money Market Fund II (formerly, Chase Vista Federal Money Market Fund) (the "Surviving Fund"), a series of Mutual Fund Trust ("MFT") (the "Reorganization"). After the Reorganization, shareholders would hold an interest in the Surviving Fund. The investment objective and policies of the Merging Fund generally are similar to those of the Surviving Fund. In connection with the Reorganization, the Surviving Fund will be renamed "JPMorgan Federal Money Market Fund." After the proposed Reorganization, your investment will be in a larger combined fund with similar investment policies. The Surviving Fund has also entered into agreements and plans of reorganization with other money market funds whose assets are managed by J.P. Morgan Investment Management Inc. ("JPMIM") and which have identical investment objectives and policies to the Merging Fund (collectively, the "Concurrent Reorganization"). If the Concurrent Reorganization is approved by the shareholders of these other funds and certain other conditions are met, these funds will be reorganized into the Surviving Fund. The consummation of the Reorganization is contingent upon the consummation of the Concurrent Reorganization. At the Meeting, you will also be asked to consider and vote upon the election of Trustees of JPMIF. The investment adviser for the assets of the Merging Fund is JPMIM. The investment adviser for the Surviving Fund is J.P. Morgan Fleming Asset Management (USA) Inc. ("JPMFAM"). After the Reorganization, JPMFAM, the same investment adviser that currently is responsible for the Surviving Fund, will make the day-to-day investment decisions for your portfolio. Please see the enclosed Combined Prospectus/Proxy Statement for detailed information regarding the proposed Reorganization, the Concurrent Reorganization and a comparison of the Merging Fund and JPMIF to the Surviving Fund and MFT. The cost and expenses associated with the Reorganization, including costs of soliciting proxies, will be borne by JPMC and not by the Merging Fund, JPMIF, the Surviving Fund, MFT or their shareholders. If approval of the Reorganization is obtained, you will automatically receive shares in the Surviving Fund. The Proposals have been carefully reviewed by the Board of Trustees of JPMIF, which has approved the Proposals. THE BOARD OF TRUSTEES OF JPMIF 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 our proxy solicitor, D.F. King & Co., Inc., or 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. 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 combine funds that have similar investment objectives and policies and each board believes that the Reorganization should result in better service for shareholders, including a wider variety of investment options. IF THE REORGANIZATION IS APPROVED, WHAT WILL HAPPEN? Under the Reorganization, the Merging Fund will cease investing in The Federal Money Market Portfolio (the "Master Portfolio" in which it currently invests), will transfer all of its assets and liabilities to the Surviving Fund and will receive, in exchange, shares of the Surviving Fund. The Merging Fund will then be liquidated and those shares of the Surviving Fund will be distributed to shareholders such as you. After the Reorganization, you will own shares in the Surviving Fund rather than the Merging Fund. The Surviving Fund invests directly in portfolio securities rather than in a master portfolio. WHAT WILL BE THE EFFECT ON THE INVESTMENT STRATEGIES ASSOCIATED WITH MY INVESTMENT IF THE PROPOSED CHANGES ARE APPROVED? The Surviving Fund generally has similar investment objectives and policies to those of the Merging Fund. The principal differences are as follows: Surviving Fund Merging Fund - -------------- ------------ - - The Surviving Fund's investment - The Merging Fund's investment objective is to aim to provide objective is to provide high current current income while still income consistent with the preserving capital and preservation of capital and same-day maintaining liquidity. liquidity. - - Invests primarily in direct debt - Invests exclusively in U.S. Treasury securities of the U.S. Treasury, Securities and in U.S. government including Treasury bills, bonds agency obligations, the income from and notes, and debt securities which is generally free from state and that certain U.S. government local income taxes. agencies or authorities have either issued or guaranteed as to principal and interest. The Reorganization is not intended to have any immediate significant impact on the investment strategy implemented in respect of your investment. However, please note that while the Merging Fund invests all of its asset in the Master Portfolio (which in turn invests in portfolio securities), the Surviving Fund invests 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) and 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. If an increase does occur, The Chase Manhattan Bank 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? Yes. JPMFAM, the investment adviser that currently manages the day-to-day investment activities of the Surviving Fund, will continue to manage that 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 shares in the Surviving Fund. HOW WILL THE PROPOSED CONCURRENT REORGANIZATION AFFECT MY INVESTMENT IF IT IS APPROVED BY THE SHAREHOLDERS OF THE OTHER FUNDS? If the Concurrent Reorganization is approved and certain other conditions are met, the assets and liabilities of the other merging funds will become the assets and liabilities of the Surviving Fund. The consummation of the Reorganization is contingent upon the consummation of the Concurrent Reorganization. WHY AM I BEING ASKED TO VOTE ON THE ELECTION OF TRUSTEES FOR JPMIF IF AFTER THE REORGANIZATION I WILL OWN SHARES IN THE SURVIVING FUND, A SERIES OF MFT? Even if the Reorganization is approved, other mutual funds that are series of JPMIF will continue to exist and operate. All shareholders of any series of JPMIF as of the record date (April 6, 2001) are required to be given a vote on the proposals regarding Trustees. Because as of the record date you are still a shareholder in JPMIF, you are entitled to vote on this proposal. Shareholders of MFT are being asked to approve the same Trustees that are proposed for JPMIF. 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. J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND, 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 Institutional Service Federal Money Market Fund: NOTICE IS HEREBY GIVEN THAT a Special Meeting of the shareholders ("Shareholders") of J.P. Morgan Institutional Service Federal Money Market Fund (the "Merging Fund"), a series of J.P. Morgan Institutional Funds ("JPMIF"), 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 JPMIF, on behalf of the Merging Fund, Mutual Fund Trust ("MFT"), on behalf of JPMorgan Federal Money Market Fund II (formerly, Chase Vista Federal Money Market 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 Premier Class shares of the Surviving Fund (the "Surviving Fund Shares"); and (b) the distribution of such Surviving Fund 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 JPMIF. 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 attached 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 JPMIF. 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 16, 2001 COMBINED PROSPECTUS/PROXY STATEMENT DATED MAY 16, 2001 ACQUISITION OF THE ASSETS AND LIABILITIES OF J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND, A SERIES OF J.P. MORGAN INSTITUTIONAL FUNDS 60 STATE STREET, SUITE 1300 BOSTON, MASSACHUSETTS 02109 (617) 557-0700 BY AND IN EXCHANGE FOR SHARES OF JPMORGAN FEDERAL MONEY MARKET FUND II (FORMERLY, CHASE VISTA FEDERAL MONEY MARKET FUND), A SERIES OF MUTUAL FUND TRUST 1211 AVENUE OF THE AMERICAS, 41ST FLOOR NEW YORK, NEW YORK 10036 (800) 348-4782 This Combined Prospectus/Proxy Statement relates to the proposed reorganization of J.P. Morgan Institutional Service Federal Money Market Fund (the "Merging Fund"), a series of J.P. Morgan Institutional Funds ("JPMIF"), into JPMorgan Federal Money Market Fund II (formerly, Chase Vista Federal Money Market Fund) (the "Surviving Fund"), a series of Mutual Fund Trust ("MFT"). If approved by Shareholders, the proposed reorganization will be effected by transferring all of the assets and liabilities of the Merging Fund to the Surviving Fund, which has generally similar investment objectives and policies to those of the Merging Fund, in exchange for 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"). JPMIF and MFT are both open-end management investment companies offering shares in several portfolios. In connection with the Reorganization, the Surviving Fund will be renamed "JPMorgan Federal Money Market Fund." Under the proposed Reorganization, each Merging Fund Shareholder will receive Premier Class shares (the "Surviving Fund Shares") of the Surviving Fund with a value equal to such Merging Fund Shareholder's holdings in the Merging Fund. The Surviving Fund currently has a multi-class structure under which it offers Reserves Class, Vista Class, Premier Class and Institutional Class shares. In connection with the Reorganization, the Surviving Fund will rename the Vista Class "Morgan Class," will rename the Institutional Class "Agency Class" and will introduce a new "Institutional Class" of shares. At the Meeting, you also will be asked to consider and vote upon the election of Trustees of JPMIF. 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 JPMIF, on behalf of the Merging Fund, MFT, 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 JPMIF 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 MFT's prospectus for Surviving Fund 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 MFT and JPMIF that an investor should know before voting on the proposals. The current Prospectuses, Statements of Additional Information and Annual Reports for the Merging Fund and the Surviving Fund (including the Annual Report of The Federal Money Market Portfolio) and Semi-Annual Report of the Surviving Fund, are incorporated herein by reference, and the current Prospectus, Annual Report and Semi-Annual Report of the Surviving Fund are enclosed with this Combined Prospectus/Proxy Statement. A Statement of Additional Information relating to this Combined Prospectus/Proxy Statement containing additional information about MFT and JPMIF 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 and Annual Report of the Merging Fund (including the Annual Report for the Federal Money Market Portfolio), may be obtained without charge by writing to MFT 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 16, 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 MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY MFT OR JPMIF. -2- 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. -3- 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............................8 INVESTMENT POLICIES...........................................................13 PURCHASES, REDEMPTIONS AND EXCHANGES..........................................19 DISTRIBUTIONS AND TAXES.......................................................23 COMPARISON OF THE MERGING FUND'S AND THE SURVIVING FUND'S ORGANIZATION STRUCTURE........................................................24 INFORMATION RELATING TO THE ADVISORY CONTRACTS AND OTHER SERVICES.............26 PROPOSAL 2: ELECTION OF TRUSTEES..............................................29 VOTE REQUIRED.................................................................30 INFORMATION RELATING TO VOTING MATTERS........................................34 ADDITIONAL INFORMATION ABOUT MFT..............................................36 ADDITIONAL INFORMATION ABOUT JPMIF............................................37 FINANCIAL STATEMENTS AND EXPERTS..............................................37 OTHER BUSINESS................................................................37 LITIGATION....................................................................38 SHAREHOLDER INQUIRIES.........................................................38 APPENDIX A AGREEMENT AND PLAN OF REORGANIZATION...............................1 -i- 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 JPMIF 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 America, 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 16, 2001. PROPOSAL 1: REORGANIZATION PLAN As you may be aware, J.P. Morgan & Co. Incorporated, the former corporate parent of the investment adviser of the Merging Fund's assets, recently completed a merger with The Chase Manhattan Corporation 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 in order to provide better service for shareholders of funds advised by its subsidiaries. At the Meeting, Merging Fund Shareholders will consider and vote upon the Agreement and Plan of Reorganization (the "Reorganization Plan") dated _______, 2001 among JPMIF, on behalf of the Merging Fund, MFT, on behalf of the Surviving Fund (the Merging Fund and the Surviving Fund are collectively defined as the "Funds"), and JPMC pursuant to which all of the assets and liabilities of the Merging Fund will be transferred to the Surviving Fund in exchange for Surviving Fund Shares. As a result of the Reorganization, Merging Fund Shareholders will become shareholders of the Surviving Fund and will receive Surviving Fund 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 Federal Money Market Fund." Further information relating to the Surviving Fund is set forth herein, and the Surviving Fund's Prospectus, Annual Report and Semi-Annual Report are enclosed with this Combined Prospectus/Proxy Statement. THE JPMIF 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 JPMIF Board will consider other appropriate courses of action. 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, Annual Report of each of the Surviving Fund and the Merging Fund (including the Annual Report of The Federal Money Market Portfolio) and Semi-Annual Report of the Merging Fund and the Reorganization Plan attached to this Combined Prospectus/Proxy Statement as Appendix A. PROPOSED REORGANIZATION Pursuant to the proposed Reorganization Plan, the Merging Fund will transfer all of its assets and liabilities to the Surviving Fund in exchange for shares of the Surviving Fund. Under the proposed Reorganization, each Merging Fund Shareholder will receive a number of Premier Class 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 charge in connection with the Reorganization. See "Information Relating to the Proposed Reorganization." The Surviving Fund has investment objectives, policies and restrictions generally similar to 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 generally similar 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 MFT Board and the JPMIF 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 it is in the best interests of shareholders to combine funds that have similar investment objectives and policies and each board believes that the Reorganization should result in better service for shareholders, including a wider variety of investment options. -2- CONCURRENT REORGANIZATION The Merging Fund currently invests all of its investable assets in The Federal Money Market Portfolio (the "Master Portfolio"), which has identical investment objectives and policies as the Merging Fund and which is advised by J.P. Morgan Investment Management Inc. ("JPMIM"). J.P. Morgan Institutional Federal Money Market Fund, a series of JPMIF, and J.P. Morgan Federal Money Market Fund, a series of J.P. Morgan Funds, each have identical investment objectives and policies as the Merging Fund (the "Feeder Portfolios") and also currently invest all of their assets in the Master Portfolio. The Surviving Fund has entered into substantially similar agreements and plans of reorganization with each Feeder Portfolio (collectively, the "Concurrent Reorganization"). If each of the Reorganization and the Concurrent Reorganization is approved by the shareholders of the Merging Fund and each Feeder Portfolio, respectively, and certain other conditions are met, the Merging Fund and the Feeder Portfolios will be reorganized into the Surviving Fund and the Merging Fund and the Feeder Portfolios will no longer invest their assets in the Master Portfolio. The consummation of the Reorganization is contingent upon the consummation of the Concurrent Reorganization. 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 Surviving Fund Shares received by a shareholder of the Merging Fund will be the same as the holding period and tax basis of such 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 ADVISERS The investment adviser for the Master Portfolio (and therefore the assets of the Merging Fund and the Feeder Portfolios) is JPMIM. The investment adviser for the Surviving Fund is J.P. Morgan Fleming Asset Management (USA) Inc. ("JPMFAM"). JPMFAM and JPMIM are each wholly-owned subsidiaries of JPMC. JPMFAM will continue to serve as investment advisor following the Reorganization. INVESTMENT OBJECTIVES AND POLICIES The Surviving Fund's investment objective is to aim to provide current income while still preserving capital and maintaining liquidity. The Merging Fund's investment objective is to provide high current income consistent with the preservation of capital and same-day liquidity. See "Risk Factors" and "Investment Restrictions." The investment policies of the Surviving Fund are generally similar to those of the Merging Fund, although the Surviving Fund invests its assets directly in portfolio -3- securities, while the Merging Fund invests its assets in the Master Portfolio, which in turn invests in portfolio securities. The Surviving Fund invests primarily in direct debt securities of the U.S. Treasury, including Treasury bills, bonds and notes, and debt securities that certain U.S. government agencies or authorities have either issued or guaranteed as to principal and interest. The dollar weighted average maturity of the Surviving Fund will be 90 days or less and the Fund will buy only those instruments which have remaining maturities of 397 days or less. The Surviving Fund invests only in securities issued and payable in U.S. dollars. THE MERGING FUND INVESTS EXCLUSIVELY IN U.S. TREASURY SECURITIES AND IN U.S. GOVERNMENT AGENCY OBLIGATIONS THE INCOME FROM WHICH IS GENERALLY FREE FROM STATE AND LOCAL INCOME TAXES. Each Fund seeks to maintain a net asset value of $1.00 per share. 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 money market securities. The Surviving Fund attempts to keep its net asset value at $1.00, although there is no guarantee it will be able to do so. In general, the value of a money market investment tends to fall when prevailing interest rates rise, although it tends to be less sensitive to interest rate changes than the value of longer-term securities. Additionally, investments in the Surviving Fund may not earn as high a current income as longer-term or lower-quality securities. See "Risk Factors." CERTAIN ARRANGEMENTS WITH SERVICE PROVIDERS ADVISORY SERVICES The investment adviser for the Surviving Fund is JPMFAM. JPMFAM oversees the asset management of the Surviving Fund. As compensation for its services, JPMFAM receives a management fee from the Surviving Fund at an annual rate of 0.10% of average daily net assets. The Merging Fund currently pays a management fee at an annual rate of 0.20% of the first $1 billion of average daily net assets and 0.10% of average daily net assets for assets over $1 billion. Following the Reorganization, JPMIM will manage the Surviving Fund's assets and will receive a fee at an annual rate of 0.10% of average daily net assets. OTHER SERVICES J.P. Morgan Fund Distributors, Inc. (the "Distributor") is the distributor for the Surviving Fund. The Chase Manhattan Bank ("Chase") serves as shareholder servicing agent, administrator, fund accountant and custodian, an affiliate of the Distributor serves as sub-administrator and DST Systems, Inc. ("DST") serves as transfer agent and dividend disbursing agent for the Surviving Fund. It is anticipated that prior to the consummation of the Reorganization, The Bank of New York ("BONY") will become the Surviving Fund's fund accountant and custodian. PricewaterhouseCoopers LLP serves as the Surviving Fund's independent accountants. -4- ADMINISTRATOR As administrator, Chase receives a fee of 0.10% of average daily net assets. It is anticipated that, in connection with the Reorganization, the administration fee will be amended to reduce the fee to 0.05% for complex wide money market Fund assets in excess of $100 billion. ORGANIZATION Each of MFT and JPMIF is organized as a Massachusetts business trust. The Merging Fund is organized as a series of JPMIF and the Surviving Fund is organized as a series of MFT. PURCHASES, REDEMPTIONS AND EXCHANGES After the Reorganization, the procedures for making purchases, redemptions and exchanges of shares of the Surviving Fund will be as described in this Combined Prospectus/Proxy Statement and in 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; and (ii) estimated fees and expenses on a pro forma basis for the Surviving Fund after giving effect to the proposed Reorganization and the Concurrent Reorganization. Under the proposed Reorganization, holders of shares in the Merging Fund will receive Premier Class shares in the Surviving Fund. Please note that the Surviving Fund currently has four classes of shares: Reserves Class, Vista Class, Premier Class and Institutional Class. In connection with the Reorganization and Concurrent Reorganization, the Surviving Fund will rename the Vista Class "Morgan Class," will rename the Institutional Class "Agency Class" and will introduce a new "Institutional Class" of shares. The table indicates that both contractual (pre-waiver) and 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. In addition, Chase 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. -5-
THE MERGING FUND THE SURVIVING FUND -------------------- ---------------------------------------------------------------- RESERVE CLASS PREMIER VISTA CLASS INSTITUTIONAL SHARES SHARES CLASS SHARES SHARES CLASS 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 None None None Maximum Deferred Sales Charge (Load) shown as lower of original purchase price or redemption proceeds None None None None None ANNUAL FUND OPERATING EXPENSES (EXPENSES THAT ARE DEDUCTED FROM FUND ASSETS) Management Fees................ 0.13% 0.10% 0.10% 0.10% 0.10% Distribution (12b-1) Fees...... None 0.30% None 0.10% None Other Expenses................. 0.47% 1.04% 0.39%# 0.52# 0.23%# Total Annual Fund Operating Expenses.................... 0.60% 1.44% 0.49%# 0.72% 0.33%# Fee Waivers and Expense Reimbursements(A)... 0.15 None None None None Net Expenses................... 0.45% 1.44% 0.49% 0.72% 0.33%
(A) Reflects an agreement dated 3/1/01 by Morgan, an affiliate of JPMC, to reimburse the Fund to the extent operating expenses (which exclude interest, taxes, and extraordinary expenses) exceed 0.45% of average daily net assets with respect to The Merging Fund through 2/28/02. * The table is based on estimated expenses for current fiscal year. # Restated from the most recent fiscal year to reflect current expense arrangements. The actual Distribution Fees are expected to be 0.00% for the Reserve Class. The actual Other Expenses are expected to be 0.16%, 0.50% and 0.69% and Total Annual Fund Operating Expenses are not expected to exceed 0.26%, 0.70% and 0.79% for Institutional Class Shares, Vista Class Shares and Reserve Class Shares respectively. That is because Chase has volunteered not to collect a portion of their fees and to reimburse others. Chase may terminate this arrangement at any time. The table does not reflect charges or credits which you might incur if you invest through a financial institution. -6-
THE SURVIVING FUND -------------------------------------------------------------------------------------- PRO FORMA WITH CONCURRENT REORGANIZATION -------------------------------------------------------------------------------------- PREMIER CLASS SHARES --------------- SHAREHOLDER FEES (FEES PAID DIRECTLY FROM YOUR INVESTMENT) -Maximum Sales Charge (Load) when you 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....................... 0.10% Distribution (12b-1) Fees............. None Other Expenses........................ 0.38% Total Annual Fund Operating Expenses.. 0.48% Fee Waivers and Expense Reimbursements (A)................. 0.03% Net Expenses.......................... 0.45%
(A) Reflects an agreement by Chase, an affiliate of JPMC, to reimburse the fund to the extent operating expenses (which exclude interest, taxes, and extraordinary expenses) exceed 0.45% of average daily net assets with respect to Premier Class 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. 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........................................ $ 46 $ 177 $ 320 $ 736 THE SURVIVING FUND Vista Shares............................................ $ 74 $ 230 $ 401 $ 894 Reserve Shares.......................................... $ 147 $ 456 $ 787 $1,724 Premier Shares.......................................... $ 50 $ 157 $ 274 $ 616 Institutional Shares.................................... $ 34 $ 106 $ 185 $ 418 PRO FORMA THE SURVIVING FUND WITH CONCURRENT REORGANIZATION Premier Shares.......................................... $ 46 $ 144 $ 259 $ 595
RISK FACTORS The following discussion highlights the principal risk factors associated with an investment in the Surviving Fund. The Surviving Fund generally has investment policies and investment restrictions similar to those of the Merging Fund. Therefore, there should be similarities between the risk factors associated with the Surviving Fund and 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. The Surviving Fund attempts to keep its net asset value constant, but there is no guarantee it will be able to do so. Investments in the Surviving Fund are not bank deposits or obligations of, or guaranteed or endorsed by, Chase or any of its affiliates and are not insured by the FDIC, the Federal Reserve Board or any other government agency. Although the Surviving Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Surviving Fund. The value of a money market investment tends to fall when prevailing interest rates rise, although it tends to be generally less sensitive to interest rate changes than the value of longer-term securities. Although the Surviving Fund seeks to be fully invested, it may at times hold some of its assets in cash, which could hurt the Fund's performance. Securities in the Fund's portfolio may not earn as high a current income as longer term or lower-quality securities. 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 -8- 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 In connection with the Reorganization and the Concurrent Reorganization, the Merging Fund and the Feeder Portfolios will cease investing in the Master Portfolio. 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, MFT will issue at the Effective Time of the Reorganization full and fractional Premier Class 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 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 Surviving Fund 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 Premier Class 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 similar investment policies of the Merging Fund and the Surviving Fund. 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. -9- In addition, the consummation of the Reorganization is contingent upon the consummation of the Concurrent 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 The JPMF Board met on March 26 and 27, 2001 and the MFT Board met on April 3, 2001, and each considered and discussed the proposed Reorganization. The Trustees of each Board discussed the advantages of reorganizing the Merging Fund into the Surviving Fund. The Board of each trust has determined that it is in the best interests of the Fund's shareholders to combine the Merging Fund with the Surviving Fund. This Reorganization is part of the general integration of the J.P. Morgan and former Chase Vista funds into a single mutual fund complex. In reaching the conclusion that the Reorganization is in the best interests of Fund shareholders, each Board considered a number of factors including, among others: the terms of the Reorganization Plan; a comparison of each Fund's historical and projected expense ratios; the comparative investment performance of the Merging Fund and the Surviving Fund; the anticipated effect of such Reorganization on the relevant Fund and its shareholders; the investment advisory services supplied by the Surviving Fund's investment adviser; the management and other fees payable by the Surviving Fund; the similarities and differences in the investment objectives and policies of the Merging Fund and the Surviving Fund; and the recommendations of the relevant Fund's current investment adviser with respect to the proposed Reorganization. The Board determined that the Funds have generally similar investment objectives and policies. They noted that the Reorganization could permit the shareholders of the Merging Fund to pursue similar investment goals in a single larger fund. The Board also considered benefits expected to arise as a result of the Reorganization. Among these benefits, the Board noted that Surviving Fund Shareholders would be able to exchange into a larger number and greater variety of funds and the Surviving Fund would also benefit from the administrator's overall intent to enhance its ability effectively to monitor and oversee the quality of all service providers to the fund, including the investment adviser. Finally, the Board considered the expenses related to the Reorganization. The Board noted to the administrator's undertaking to waive fees or reimburse the Surviving -10- Fund's expenses so that the total expense ratio of each share class of the Merging Fund does not increase during the period specified in the expense table. Additional important factors were that all costs and expenses of the Reorganization would be borne by JPMC and the fact that the Board was advised that Reorganization would constitute a tax-free reorganization. After considering the foregoing factors, together with such information as it believed to be relevant, and in light of its fiduciary duties under federal and state law, each Board determined that the proposed Reorganization is in the best interests of the applicable Fund and its shareholders, determined the interests of the shareholders would not be diluted as a result of the Reorganization, approved the Reorganization Plan and directed that the Reorganization Plan be submitted to the Merging Fund Shareholders for approval. THE JPMIF BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE "FOR" THE PROPOSAL. The JPMIF 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 CONCURRENT REORGANIZATION The terms and conditions under which the Concurrent Reorganization may be consummated are set forth in reorganization plans which are substantially similar to the Reorganization Plan you are considering. As a result of the Reorganization and the Concurrent Reorganization, the Merging Fund and the Feeder Portfolios will no longer invest their assets in the Master Portfolio. The consummation of the Reorganization is contingent upon the consummation of the Concurrent Reorganization. FEDERAL INCOME TAX CONSEQUENCES Consummation of the Reorganization is subject to the condition that JPMIF 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 Surviving Fund Shares and the liquidating distributions to shareholders of the Surviving Fund 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 Surviving Fund 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 -11- 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 Surviving Fund 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. JPMIF 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. CAPITALIZATION Because the Merging Fund will be combined with the Surviving Fund in the Reorganization as well as other funds as a result of the Concurrent Reorganization, the total capitalization of the Surviving Fund after the Reorganization and the Concurrent Reorganization is expected to be greater than the current capitalization of the Merging Fund. The following table sets forth as of February 28, 2001: (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 Reorganization and the Concurrent Reorganization. There is, of course, no assurance that the Reorganization and the Concurrent Reorganization 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. Please note that the Surviving Fund currently has four classes of shares: Reserve Class, Vista Class, Premier Class and Institutional Class. In connection with the Reorganization, the Surviving Fund will rename the Vista Class the "Investor Class," will rename the Institutional Fund "Agency Class" and will introduce a new "Institutional Class" of shares. CAPITALIZATION PRO FORMA WITH CONCURRENT REORGANIZATION (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
BENEFICIAL SHARES NET ASSETS NET ASSET INTEREST OUTSTANDING VALUE PER OUTSTANDING SHARE J.P. MORGAN FUNDS Federal Money Market Fund 1,920,547 - $1,920,590 $1.00 Institutional Federal Money Market Fund 2,197,615 - $2,197,648 $1.00 Institutional Service Federal (the Merging Fund) Money Market Fund 17,167 - $17,172 $1.00 THE SURVIVING FUND Vista 673,027 $673,013 $1.00 Premier 312,286 $312,277 $1.00 Institutional 906,471 $906,486 $1.00 Reserve 1 $1 $1.00 PRO FORMA THE SURVIVING FUND WITH CONCURRENT REORGANIZATION Agency 2,197,615 $2,197,648 $1.00 Morgan 673,027 $673,013 $1.00 Premier 2,250,000 $2,250,039 $1.00 Institutional 906,471 $906,486 $1.00
-12- INVESTMENT POLICIES The following discussion summarizes some of the investment policies of the Surviving Fund. Except as noted below, the Merging Fund generally has similar investment policies to those of the Surviving Fund. This section is qualified in its entirety by the discussion in the Prospectus and Statement of Additional Information of the Surviving Fund, which are incorporated herein by reference. OBJECTIVE The Surviving Fund's investment objective is to aim to provide current income while still preserving capital and maintaining liquidity. THE MERGING FUND'S INVESTMENT OBJECTIVE IS TO PROVIDE HIGH CURRENT INCOME CONSISTENT WITH THE PRESERVATION OF CAPITAL AND SAME-DAY LIQUIDITY. The Surviving Fund cannot change its objective without shareholder approval. THE MERGING FUND MAY CHANGE ITS OBJECTIVE WITHOUT SUCH APPROVAL. SHAREHOLDERS OF THE SURVIVING FUND CURRENTLY ARE CONSIDERING A PROPOSAL THAT, IF PASSED AT A SHAREHOLDER MEETING TO BE HELD THE SAME DAY AS THE MEETING OF THE MERGING FUND, WOULD ALLOW THE SURVIVING FUND TO CHANGE ITS OBJECTIVE WITHOUT SHAREHOLDER APPROVAL. MAIN INVESTMENT STRATEGIES The Surviving Fund invests its assets directly in portfolio securities. THE MERGING FUND INVESTS ITS ASSETS IN THE MASTER PORTFOLIO, WHICH IN TURN INVESTS IN PORTFOLIO SECURITIES. The Surviving Fund invests primarily in direct debt securities of the U.S. Treasury, including Treasury bills, bonds and notes, and debt securities that certain U.S. government agencies or authorities have either issued or guaranteed as to principal and interest. The Surviving Fund does not enter into repurchase agreements. THE MERGING FUND INVESTS EXCLUSIVELY IN U.S. TREASURY SECURITIES AND IN U.S. GOVERNMENT AGENCY OBLIGATIONS THE INCOME FROM WHICH IS GENERALLY FREE FROM STATE AND LOCAL INCOME TAXES. The Surviving Fund seeks to maintain a net asset value of $1.00 per share. The dollar weighted average maturity of the Surviving Fund will be 90 days or less and the Fund will buy only those instruments which have remaining maturities of 397 days or less. -13- The Surviving Fund may invest significantly in securities with floating or variable rates of interest. Their yields will vary as interest rates change. The Surviving Fund invests only in securities issued and payable in U.S. dollars. Each investment must have the highest possible short-term rating from at least two national rating organizations, or one such rating if only one organization rates that security. Alternatively, some securities may have additional third party guarantees in order to meet the rating requirements mentioned above. If the security is not rated, it must be considered of comparable quality by JPMFAM. The Surviving Fund seeks to develop an appropriate portfolio by considering the differences in yields among securities of different maturities, market sectors and issuers. -14- INVESTMENT RESTRICTIONS The Surviving Fund and the Merging Fund have each adopted the following investment restrictions which may not be changed without approval by a "majority of the outstanding shares" of a Fund, which means the vote of the lesser of (i) 67% or more of the shares of a Fund present at a meeting, if the holders of more than 50% of the outstanding shares of a Fund are present or represented by proxy, and (ii) more than 50% of the outstanding shares of a Fund.
- -------------------------------------------------------------------------------------------------------------- SURVIVING FUND MERGING FUND - -------------------------------------------------------------------------------------------------------------- While the Surviving Fund is also diversified under the The Merging Fund may not make any investment 1940 Act, it is not subject to a similar fundamental inconsistent with its classification as a restriction. diversified investment company under the 1940 Act. - -------------------------------------------------------------------------------------------------------------- The Surviving Fund may not purchase the securities of The Merging Fund may not purchase any security that any issuer (other than securities issued or guaranteed would cause it to concentrate its investments in the by the U.S. government or any of its agencies or securities of issuers primarily engaged in any instrumentalities, or repurchase agreements secured particular industry except as permitted by the thereby) if, as a result, more than 25% of the Commission. Surviving Fund's total assets would be invested in the securities of companies whose principal business activities are in the same industry. Notwithstanding the foregoing, (i) with respect to the Surviving Fund's permissible futures and options transactions in U.S. Government securities, positions in such options and futures shall not be subject to this restriction; and (ii) the Surviving Fund may invest more than 25% of its total assets in obligations issued by banks, including U.S. banks. - -------------------------------------------------------------------------------------------------------------- The Surviving Fund may not borrow money, except for The Merging Fund may not borrow money, except to the temporary or emergency purposes, or by engaging in extent permitted by applicable law. reverse repurchase transactions, in an amount not exceeding 33% of the value of its total assets at the time when the loan is made and may pledge, mortgage or hypothecate no more than 1/3 of its net assets to secure such borrowings. Any borrowings representing more than 5% of the Surviving - -------------------------------------------------------------------------------------------------------------- -15- - -------------------------------------------------------------------------------------------------------------- Fund's total assets must be repaid before the Surviving Fund may make additional investments. - -------------------------------------------------------------------------------------------------------------- The Surviving Fund may not purchase or sell physical The Merging Fund may not purchase or sell commodities unless acquired as a result of ownership commodities or commodity contracts unless acquired of securities or other instruments but this shall not as a result of ownership of securities or other prevent the Fund from (i) purchasing or selling instruments issued by persons that purchase or sell options and futures contracts or from investing in commodities or commodities contracts; but this shall securities or other instruments backed by physical not prevent the Merging Fund from purchasing, commodities or (ii) engaging in forward purchases or selling and entering into financial futures sales of foreign currencies or securities. contracts (including futures contracts on indices of securities, interest rates and currencies), options on financial futures contracts (including futures contracts on indices of securities, interest rates and currencies), warrants, swaps, forward contracts, foreign currency spot and forward contracts or other derivative instruments that are not related to physical commodities. - -------------------------------------------------------------------------------------------------------------- The Surviving Fund may not make loans, except that the The Merging Fund may make loans to other persons, in Surviving Fund may: (i) purchase and hold debt accordance with the Fund's investment objective and instruments (including without limitation, bonds, policies and to the extent permitted by applicable notes, debentures or other obligations and law. certificates of deposit, bankers' acceptances and fixed time deposits) in accordance with its investment objectives and policies; (ii) enter into repurchase agreements with respect to portfolio securities; and (iii) lend portfolio securities with a value not in excess of one-third of the value of its total assets. SHAREHOLDERS OF THE SURVIVING FUND CURRENTLY ARE CONSIDERING A PROPOSAL THAT, IF PASSED AT A SHAREHOLDER MEETING TO BE HELD THE SAME DAY AS THE MEETING OF THE MERGING FUND, WOULD ALLOW A FUNDAMENTAL INVESTMENT RESTRICTION REGARDING LOANS THAT IS IDENTICAL TO THE MERGING FUND'S RESTRICTION. - --------------------------------------------------------------------------------------------------------------
-16- Neither Fund may issue senior securities, except as permitted under the 1940 Act or any rule, order or interpretation thereunder. Neither Fund may underwrite securities of other issuers, except to the extent that the Fund, in disposing of portfolio securities, may be deemed an underwriter within the meaning of the Securities Act of 1933, as amended. Neither Fund may purchase or sell real estate (including, for the Surviving Fund, real estate limited partnerships), except that, to the extent permitted by applicable law, each Fund may (a) invest in securities or other instruments directly or indirectly secured by real estate and (b) invest in securities or other instruments issued by issuers that invest in real estate. Notwithstanding any other investment policy or restriction, the Surviving Fund may seek to achieve its investment objective by investing all of its investable assets in another investment company having substantially the same investment objective and policies as the Surviving Fund. Although the Merging Fund currently invests all of its assets in the Fund Master Portfolio, following the Reorganization, the Surviving will invest directly in portfolio securities. NON-FUNDAMENTAL INVESTMENT RESTRICTIONS. The investment restrictions described below are not fundamental policies of the Surviving Fund and/or the Merging Fund and may be changed by their respective Trustees.
- -------------------------------------------------------------------------------------------------------------- SURVIVING FUND MERGING FUND - -------------------------------------------------------------------------------------------------------------- The Surviving Fund may not invest more than 10% of its The Merging Fund may not acquire any illiquid net assets in illiquid securities. For purposes of securities, such as repurchase agreements with more this non-fundamental restriction, "illiquid than seven days to maturity or fixed time deposits securities" include securities restricted as to resale with a duration of over seven calendar days, if as a unless they are determined to be readily marketable in result thereof, more than 10% of the market value of accordance with the procedures established by the the Merging Fund's total assets would be in Board of Trustees. investments which are illiquid. - -------------------------------------------------------------------------------------------------------------- The Surviving Fund may not make short sales of The Merging Fund may not purchase securities on securities, other than short sales "against the box," margin, make short sales of securities, or maintain or purchase securities on margin except for short-term a short position, provided that this restriction credits necessary for clearance of portfolio shall not be deemed to be applicable to the purchase transactions, provided that this restriction will not or sale of when-issued or delayed delivery be applied to limit the use of options, futures securities. contracts and related options, in the manner otherwise permitted by the investment restrictions, policies and - -------------------------------------------------------------------------------------------------------------- -17- - -------------------------------------------------------------------------------------------------------------- investment program of the Fund. The Surviving Fund has no current intention of making short sales against the box. - -------------------------------------------------------------------------------------------------------------- The Surviving Fund may not, with respect to 75% of its The Merging Fund is not subject to a similar assets, hold more than 10% of the outstanding voting non-fundamental restriction, although as a matter of securities of any issuer or invest more than 5% of its fundamental policy the Merging Fund may not make any assets in the securities of any one issuer (other than investment inconsistent with its classification as a obligations of the U.S. Government, its agencies and diversified investment company under the 1940 Act. instrumentalities). - -------------------------------------------------------------------------------------------------------------- The Surviving Fund may invest up to 5% of its total The Merging Fund may not acquire securities of other assets in the securities of any one investment investment companies, except as permitted by the company, but may not own more than 3% of the 1940 Act or any order pursuant thereto. securities of any one investment company or invest more than 10% of its total assets in the securities of other investment companies. - -------------------------------------------------------------------------------------------------------------- The Surviving Fund may not purchase or sell interests The Merging Fund is not subject to a similar in oil, gas or mineral leases. non-fundamental restriction. - -------------------------------------------------------------------------------------------------------------- The Surviving Fund may not write, purchase or sell any The Merging Fund is not subject to a similar put or call option or any combination thereof, non-fundamental restriction. provided that this shall not prevent (i) the writing, purchasing or selling of puts, calls or combinations thereof with respect to portfolio securities or (ii) with respect to the Surviving Fund's permissible futures and options transactions, the writing, purchasing, ownership, holding or selling of futures and options positions or of puts, calls or combinations thereof with respect to futures. - -------------------------------------------------------------------------------------------------------------- The Surviving Fund will not invest more than 25% of The Merging Fund is not subject to a similar its total assets in obligations issued by foreign non-fundamental restriction. banks (other than foreign branches of U.S. banks). - -------------------------------------------------------------------------------------------------------------- -18- - -------------------------------------------------------------------------------------------------------------- The Surviving Fund is not subject to a similar The Merging Fund may not borrow money (not including non-fundamental restriction, although it is subject to reverse repurchase agreements), except from banks the fundamental restriction regarding borrowing for temporary or extraordinary or emergency purposes described above. and then only in amounts up to 10% of the value of the Fund's total assets, taken at cost at the time of such borrowing (and provided that such borrowings and reverse repurchase agreements do not exceed in the aggregate one-third of the market value of the Fund's total assets less liabilities other than the obligations represented by the bank borrowings and reverse repurchase agreements). The Merging Fund may not mortgage, pledge, or hypothecate any assets except in connection with any such borrowing and in amounts up to 10% of the value of the Fund's net assets at the time of such borrowing. The Fund will not purchase securities while borrowings exceed 5% of the Fund's total assets; provided, however, that the Fund may increase its interest in an open-end management investment company with the same investment objective and restrictions as the Fund while such borrowings are outstanding. This borrowing provision is included to facilitate the orderly sale of portfolio securities, for example, in the event of abnormally heavy redemption requests, and is not for investment purposes. - --------------------------------------------------------------------------------------------------------------
There will be no violation of any investment restriction if that restriction is complied with at the time the relevant action is taken notwithstanding a later change in market value of an investment, in net or total assets, in the securities rating of the investment, or any other later change. PURCHASES, REDEMPTIONS AND EXCHANGES Following the Reorganization, the procedures for purchases, redemptions and exchanges of shares will be those of the Surviving Fund, which are generally similar to those of the Merging Fund. The following discussion applies to Premier Class shares. This section is qualified in its entirety by the discussion in the Prospectus and Statement of Additional Information of the Surviving Fund, which are incorporated herein by reference. -19- SALES CHARGES There is no sales charge to buy or sell Premier Class shares. 12b-1 FEES There is no Rule 12b-1 distribution plan for Premier Class shares of the Surviving Fund. BUYING SURVIVING FUND SHARES THE FOLLOWING DISCUSSION APPLIES TO PURCHASES OF PREMIER CLASS SHARES THAT YOU MIGHT MAKE AFTER THE REORGANIZATION. The price shareholders pay for their shares is the net asset value per share (NAV). 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 seeks to maintain a stable NAV of $1.00. The Surviving Fund uses the amortized cost method to value its portfolio of securities. This method provides more stability in valuations. However, it may also result in periods during which the stated value of a security is different than the price the Surviving Fund would receive if it sold the investment. The NAV of each class of shares is generally calculated as of 4:00 p.m. Eastern time each day the Surviving Fund is accepting purchase orders. 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 Federal Reserve Bank of New York and the New York Stock Exchange are open. If an order is sent in proper form by the Surviving Fund's cut-off time, it will be processed at that day's price and you will be entitled to all dividends declared on that day. If your order is received after the cut-off time, it generally will be processed at the next day's price. If you pay by check before the cut-off time, your order generally will be processed the next day the Surviving Fund is open for business. Normally, the cut-off (in Eastern time) is 2:00 p.m. A later cut-off time may be permitted for investors buying their shares through Chase or a bank affiliate of Chase so long as such later cut-off time is before the Fund's NAV is calculated. If you buy through an agent and not directly from the Center, the agent could set earlier cut-off times. The Surviving Fund can set an earlier cut-off time if the Public Securities Association recommends that the U.S. Government securities market close trading early. You must provide a Taxpayer Identification Number when you open an account. The Surviving Fund has the right to reject any purchase order for any reason. Premier shares are available only to qualified investors. These are defined as institutions, trusts, partnerships, corporations and certain retirement plans and fiduciary accounts opened by a bank, trust company or thrift institution which has investment -20- authority over such accounts, as well as individuals who meet the Surviving Fund's minimum investment requirements. Shareholders receiving Premier Class shares in the Reorganization will be permitted to purchase additional Premier shares in the future. For Premier Class 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 2:00 p.m., Eastern time, on the day the shareholder buys. Shareholders seeking to buy Premier Class 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 Premier Class shares. SELLING SURVIVING FUND SHARES THE FOLLOWING DISCUSSION APPLIES TO SALES OF THE PREMIER CLASS SHARES THAT YOU MIGHT MAKE AFTER THE REORGANIZATION. 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. Under normal circumstances, if a request is received before the cut-off time, 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. If a shareholder's address of record has changed within the 30 days prior to the sale request or if more than $25,000 of shares is sold by phone, proceeds by electronic transfer or wire will be sent only to the bank account on the Surviving Fund's records. For Premier Class 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. -21- 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 by calling 1-800-348-4782. A systematic withdrawal plan is available for Premier Class shares. EXCHANGING SURVIVING FUND SHARES THE FOLLOWING DISCUSSION APPLIES TO EXCHANGES OF PREMIER CLASS SHARES THAT YOU MIGHT MAKE AFTER THE REORGANIZATION. Premier Class 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 Surviving 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 Premier Class shares, the Surviving Fund may close an account if the balance falls below $10,000,000. 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. Investors agree that they will not hold the Surviving Fund liable for any loss or expenses from any sales request, if the Surviving 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. -22- 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 Surviving Fund may modify or cancel the sale of shares by phone without notice. MFT, on behalf of the Surviving Fund, has entered into agreements with certain shareholder servicing agents (including Chase) under which the shareholder servicing agents 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 0.10% of the average daily net assets of the Premier Class shares held by investors serviced by the shareholder servicing agent. JPMFAM and/or the Distributor 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 issues 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 Fund 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 declares dividends daily and distributes any net investment income at least monthly. Net capital gain is distributed annually. You have two options for your Surviving Fund distributions. You may: - reinvest all of them in additional Surviving Surviving Fund shares without a sales charge; 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. The state or municipality where you live may not charge you state and local taxes on tax-exempt interest earned on certain bonds. Dividends earned on bonds issued by the U.S. government and its agencies may also be exempt from some types of state and local taxes. -23- 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 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 The Merging Fund is organized as a series of JPMIF, which is organized under the law of the Commonwealth of Massachusetts. As a Massachusetts business trust, JPMIF's operations are governed by JPMIF'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. STRUCTURE OF THE SURVIVING FUND The Surviving Fund is organized as a series of MFT, which is organized under the law of the Commonwealth of Massachusetts. As a Massachusetts business trust, MFT's operations are governed by MFT's Declaration of Trust and By-Laws and applicable Massachusetts law. The operations of the Surviving 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 is managed by JPMIF's Trustees and the business of the Surviving Fund is managed by MFT'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 MFT and JPMIF is set forth in the Funds' respective Statements of Additional Information, which are incorporated herein by reference. -24- SHARES OF FUNDS Each of MFT and JPMIF 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 portfolio or class. The shares of each portfolio or class of either MFT or JPMIF participate equally in the earnings, dividends and assets of the particular series or class. Fractional shares have proportionate rights to full shares. Expenses of MFT or JPMIF 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. Neither MFT nor JPMIF is 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 either MFT or JPMIF. SHAREHOLDER VOTING RIGHTS A vacancy in the Board of either MFT or JPMIF 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 either MFT or JPMIF could, under certain circumstances, be held personally liable as partners for the obligations of that trust. However, the Declaration of Trust of each of MFT and JPMIF 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. Each of MFT and JPMIF 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. -25- LIABILITY OF DIRECTORS AND TRUSTEES Under the Declaration of Trust of each of MFT and JPMIF, 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 each of MFT and JPMIF, 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 of the Declaration of Trust and By-Laws of each of MFT and JPMIF 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 investment adviser of the Master Portfolio (and therefore the Merging Fund's assets) is JPMIM. Pursuant to an Advisory Agreement, the investment adviser of the Surviving Fund is JPMFAM. DESCRIPTION OF JPMFAM JPMFAM, a registered investment adviser, is an indirect wholly-owned subsidiary of JPMC, incorporated under the laws of Delaware. JPMFAM's principal executive offices are located at 522 Fifth Avenue, New York, New York 10036. As of _______ __, 2001, JPMFAM and certain of its affiliates (including JPMIM) provided investment management services with respect to assets of approximately $___ billion. Under the Advisory Agreement, JPMFAM is responsible for making decisions with respect to, and placing orders for, all purchases and sales of the portfolio securities of the Surviving Fund. JPMFAM's responsibilities under the Advisory Agreement 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. Under the Advisory Agreement, JPMFAM is obligated to furnish employees, office space and facilities required for the operation of the Surviving Fund. The services provided to the Surviving Fund by JPMFAM are substantially similar to the services currently provided to the Master Portfolio by JPMIM. EXPENSES AND MANAGEMENT FEES. The Advisory Agreement provides that the Surviving Fund will pay JPMFAM a monthly management fee based upon the net assets of -26- the Surviving Fund. The annual rate of this management fee is 0.10%. The Merging Fund currently pays JPMIM 0.20% of the first $1 billion of average daily net assets and 0.10% of average daily net assets in excess of $1 billion with respect to its assets in the Master Portfolio. JPMFAM 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 JPMFAM 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; advisory and administrative fees; charges of the custodian and transfer agent; insurance premiums; auditing and legal expenses; costs of shareholders' reports and shareholder meetings; any extraordinary expenses; and brokerage fees and commissions, if any, in connection with the purchase or sale of portfolio securities. SUBCONTRACTING. JPMFAM is authorized by the Advisory Agreement to employ or associate with such other persons or entities as it believes to be appropriate to assist it in the performance of its duties. Any such person is required to be compensated by JPMFAM, not by the Surviving Fund, and to be approved by the shareholders of that Fund as required by the 1940 Act. LIMITATION ON LIABILITY. The Advisory Agreement provides that JPMFAM will not be liable for any error of judgment or mistake of law or for any act or omission or loss suffered by MFT 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 MFT 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 MFT Board or by vote of the majority of the Surviving Fund's outstanding voting securities upon 60 days' written notice to JPMFAM, and by JPMFAM on 60 days' written notice to MFT. -27- PORTFOLIO TRANSACTIONS AND BROKERAGE COMMISSIONS JPMFAM, as the investment adviser to the Surviving Fund, has responsibilities with respect to the Fund's portfolio transactions and brokerage arrangements pursuant to the Fund's policies, subject to the overall authority of the MFT Board. Under the Advisory Agreement, JPMFAM, subject to the general supervision of the Board, is responsible for the placement of orders for the purchase and sale of portfolio securities for the Surviving Fund with brokers and dealers selected by JPMFAM. These brokers and dealers may include brokers or dealers affiliated with JPMFAM to the extent permitted by the 1940 Act and MFT's policies and procedures applicable to the Fund. JPMFAM shall use its best efforts to seek to execute portfolio transactions at prices which, under the circumstances, result in total costs or proceeds being the most favorable to such Fund. In assessing the best overall terms available for any transaction, JPMFAM shall consider all factors it deems relevant, including the breadth of the market in the security, the price of the security, the financial condition and execution capability of the broker or dealer, research services provided to JPMFAM, and the reasonableness of the commission, if any, both for the specific transaction and on a continuing basis. In no event shall JPMFAM be under any duty to obtain the lowest commission or the best net price for the Fund on any particular transaction, nor shall JPMFAM be under any duty to execute any order in a fashion either preferential to such Fund relative to other accounts managed by JPMFAM or otherwise materially adverse to such other accounts. In selecting brokers or dealers qualified to execute a particular transaction, brokers or dealers may be selected who also provide brokerage and research services (as those terms are defined in Section 28(e) of the Securities Exchange Act of 1934) to JPMFAM, the Fund and/or the other accounts over which JPMFAM exercises investment discretion. JPMFAM is authorized to pay a broker or dealer who provides such brokerage and research services a commission for executing a portfolio transaction for the Fund which is in excess of the amount of commission another broker or dealer would have charged for effecting that transaction if JPMFAM determines in good faith that the total commission is reasonable in relation to the value of the brokerage and research services provided by such broker or dealer, viewed in terms of either that particular transaction or the overall responsibilities of JPMFAM with respect to accounts over which it exercises investment discretion. JPMFAM shall report to the Board regarding overall commissions paid by the Fund and their reasonableness in relation to the benefits to such Fund. In executing portfolio transactions for the Fund, JPMFAM may, to the extent permitted by applicable laws and regulations, but shall not be obligated to, aggregate the securities to be sold or purchased with those of other funds or its other clients if, in JPMFAM's reasonable judgment, such aggregation (i) will result in an overall economic benefit to such fund, taking into consideration the advantageous selling or purchase price, brokerage commission and other expenses, and trading requirements, and (ii) is not inconsistent with the policies set forth in MFT's registration statement, as the case may be, and the Fund's Prospectus and Statement of Additional Information. In such event, JPMFAM will allocate the securities so purchased or sold, and the expenses incurred in the -28- transaction, in an equitable manner, consistent with its fiduciary obligations to such Fund and such other clients. It is possible that certain of the brokerage and research services received will primarily benefit one or more other investment companies or other accounts for which JPMFAM exercises investment discretion. Conversely, MFT or any of its portfolios may be the primary beneficiary of the brokerage or research services received as a result of portfolio transactions effected for such other accounts or investment companies. OTHER SERVICES The Distributor is wholly owned, indirect subsidiary of BISYS Fund Services, Inc., which currently serves as the distributor for both the Surviving Fund and the Merging Fund. BISYS Fund Services, Inc. is the sub-administrator for both the Surviving Fund and the Merging Fund. The Distributor is unaffiliated with JPMC or any of its subsidiaries. Chase serves as administrator, shareholder servicing agent, fund accountant and custodian, and DST serves as transfer agent and dividend disbursing agent, for the Surviving Fund. The services provided by Chase include day-to-day maintenance of certain books and records, calculation of the offering price of the shares and preparation of reports. In its role as custodian, Chase is 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, BONY will become the Surviving Fund's fund accountant and custodian. As administrator, Chase receives a fee of 0.10% of average daily net assets. It is anticipated that, in connection with the Reorganization, the administration fee will be amended to reduce the fee to 0.05% for complex wide money market Fund assets in excess of $100 billion. 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 JPMIF, which is currently organized as a Massachusetts business trust. Even if the Reorganization described in Proposal 1 is approved, other mutual funds that are series of JPMIF will continue to exist and operate. All shareholders of any series of JPMIF as of the record date (April 6, 2001) are required to be given a vote on the proposal regarding Trustees. Because as of the record date you are still a shareholder in JPMIF, you are entitled to vote on this proposal. Shareholders of MFT are being asked to approve the same Trustees as are being proposed for JPMIF. 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 JPMFAM, 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 -29- current Trustees of MFT and certain current Trustees of JPMIF (including certain numbers 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 MFT are concurrently considering the election of the same individuals to the Board of Trustees of MFT. Biographical information about the Nominees and other relevant information is set forth below. More information regarding the current Trustees of MFT and JPMIF is contained in the Funds' 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 JPMIF 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 JPMIF. The following are the nominees: ----------------------------------------------. The Board of Trustees of JPMIF met four times during the fiscal year ended October 31, 2000, and each of the Trustees attended at least 75% of the meetings. The Board of Trustees of JPMIF 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 October 31, 2000. A majority of the disinterested Trustees have adopted written procedures reasonably appropriate to deal with potential conflicts of interest arising from the fact that the same individuals are Trustees of JPMIF, the Master Portfolio and certain other investment companies in the Fund Complex, up to and including creating a separate board of trustees. Each Trustee receives an annual fee of $75,000, which is allocated among all investment companies for which the Trustee serves. *Interested Trustee, as defined by the 1940 Act. -30- REMUNERATION OF TRUSTEES AND CERTAIN EXECUTIVE OFFICERS Each Trustee is currently paid an annual fee of $75,000 for serving as Trustee of the investment companies in the Fund Complex and is reimbursed for expenses incurred in connection with service as a Trustee. The Trustees may hold various other directorships unrelated to these funds. Trustee compensation expenses paid for the calendar year ended December 31, 2000 are set forth below.
Aggregate Trustee Compensation Paid by the Total Trustee Compensation Accrued Name of Trustee Trust During 2000 by Fund Complex(1) During 2000(2) --------------- ------------------------ ---------------------------------- Frederick S. Addy, Trustee $ 23,538 $ 75,000 William G. Burns, Trustee $ 23,538 $ 75,000 Arthur C. Eschenlauer, Trustee $ 23,538 $ 75,000 Matthew Healey, Trustee(3) Chairman and Chief Executive Officer $ 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 JPMIF's business affairs. Each of JPMIF 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. Morgan Family of Funds (formerly "The Pierpont Family of Funds"), and the Trustees are the equal and sole shareholders of Pierpont Group, Inc. JPMIF 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 -31- 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 Merging 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 and the Master Portfolio during the indicated fiscal periods are set forth below: MERGING FUND -- For the period November 5, 1997 (commencement of operations) through October 31, 1998, 1999 and 2000: $264, $564 and $1,054. MASTER PORTFOLIO -- For the fiscal years ended October 31, 1998, 1999 and 2000: $25,893, $36,961 and $46,373. 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 JPMIF; 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 JPMIF, 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 -- Former 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. 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. -32- PRINCIPAL EXECUTIVE OFFICERS: JPMIF's and the Master Portfolio's principal executive officers (listed below), other than the Chief Executive Officer and the officers who are employees of JPMIM, are provided and compensated by Funds Distributors, Inc., a wholly owned indirect subsidiary of Boston Institutional Group, Inc. The officers conduct and supervise the business operations of JPMIF and the Master Portfolio. JPMIF and the Master Portfolio have no employees. The business address of each of the officers unless otherwise noted is Funds Distributor, Inc., 60 State Street, Suite 1300, Boston, Massachusetts 02109. The principal executive officers of JPMIF 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 Vice President and Secretary. Senior 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. From May 1994 to June 1995, Mr. Rio was Director of Business Development for First Data Corporation.
ACCOUNTANTS PricewaterhouseCoopers LLP serves as the Merging Fund's, the Master Portfolio's and the Surviving Fund'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 MFT or JPMIF 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 and for the last fiscal year ended was $32,500. FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES. The aggregate fees billed for financial information systems and design implementation services rendered -33- 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 $11,029,150. The Audit Committee has considered whether the provision of non-audit services is compatible with maintaining the independence of PricewaterhouseCoopers LLP. INFORMATION RELATING TO VOTING MATTERS GENERAL INFORMATION This Combined Prospectus/Proxy Statement is being furnished in connection with the solicitation of proxies by the JPMIF Board for use at the Meeting. It is expected that the solicitation of proxies will be primarily by mail. JPMIF's officers and service providers may also solicit proxies by telephone, facsimile machine, telegraph, the Internet or personal interview. In addition JPMIF 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 JPMIF 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 JPMIF 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 -34- 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 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 JPMIF, 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 JPMIF 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. -35- INTERESTED PARTIES On the record date, the Trustees and officers of JPMIF 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% the class shares of the Merging Fund or any class thereof and the percentage of shares of the Surviving Fund or any class thereof that would be owned by such persons upon consummation of the Reorganization and the Concurrent Reorganization based upon their holdings at _______, 2001 are as follows:
Percentage of Percentage of Amount of Merging Fund Surviving Fund Shares Owned on Record Owned Upon Name and Address Owned Date Consummation - ----------------------------- ----------- ----------------- ------------------
On the record date, the Trustees and officers of MFT as a group owned less than 1% of the outstanding shares of the Surviving 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 Surviving Fund or any class thereof and the percentage of shares of the Surviving Fund or any class thereof that would be owned by such persons upon consummation of the Reorganization and the Concurrent Reorganization based upon their holdings at _______, 2001 are as follows:
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 MFT Information about the Surviving Fund is included in its Prospectus, which is incorporated by reference and enclosed herein. Additional information about the Surviving Fund is also included in MFT's Statement of Additional Information, which has been filed with the Commission and which is incorporated herein by reference. Copies of the Statement of Additional information may be obtained without charge by calling 1-800-348-4782. MFT 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 -36- 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. ADDITIONAL INFORMATION ABOUT JPMIF Information about the Merging Fund is included in its Prospectus, which is incorporated by reference herein. Additional information about the Merging Fund is also included in JPMIF's Statement of Additional Information which has been filed with the Commission and which is incorporated herein by reference. Copies of the Statement of Additional information may be obtained without charge by calling 1-800-766-7722. JPMIF 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 the Merging Fund for the fiscal year ended October 31, 2000, the audited financial statements, notes thereto and supplementary data of the Master Portfolio for the fiscal year ended October 31, 2000 and the audited financial highlights, financial statements and notes thereto of the Surviving Fund for the fiscal year ended August 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 supplementary data, as applicable, for the Merging Fund, the Master Portfolio and the Surviving Fund 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 Surviving Fund for the fiscal period ended February 28, 2001, are incorporated by reference herein and into the Statement of Additional Information related to this Combined Prospectus/Proxy Statement. OTHER BUSINESS The JPMIF 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 JPMIF -37- Board 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 Neither MFT nor JPMIF is 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 JPMIF 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. -38- 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 JPMorgan Institutional Service Federal Money Market Fund (the "Transferor Portfolio"), Mutual Fund Trust (the "Acquiring Trust"), a Massachusetts business trust, on behalf of JPMorgan Federal Money Market Fund II (formerly, Chase Vista Federal Money Market 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 Premier Class share class in exchange for A-1 shares of the Transferor Portfolio, with the amounts of shares of each share class to be determined by the parties. 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 Bank of New York (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 A-2 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. (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 Premier Class 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 Premier Class shares of the Acquiring Portfolio, both as determined in accordance with Section 1(c)(i). (iii) 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. A-3 (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 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 which as of February 28, 2001 there were outstanding 312,286 Premier Class 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 for the fiscal year ended August 31, 2000, which have been audited by PricewaterhouseCoopers LLP, 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 generally accepted accounting principles ("GAAP"). The financial statements of the Acquiring Trust with respect to the Acquiring Portfolio for the fiscal period ended February 28, 2001 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. A-4 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. (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 February 28, 2001 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 February 28, 2001, 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. A-5 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. 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. A-6 (d) CAPITALIZATION. The Transferor Trust has an unlimited number of authorized shares of beneficial interest of which as of February 28, 2001 there were outstanding 17,167 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. (e) FINANCIAL STATEMENTS. The financial statements for the Transferor Trust with respect to the Transferor Portfolio and for The Federal Money Market Portfolio for the fiscal year ended October 31, 2000 which have been audited by PricewaterhouseCoopers LLP fairly present the financial position of the Transferor Portfolio, The Federal Money Market 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. A-7 (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 October 31, 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 October 31, 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 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. A-8 (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 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. A-9 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 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 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 A-10 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"). A-11 (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 adverse change (as described in Section 2(i)) in the financial condition, results of operations, business, properties or assets of the Acquiring Portfolio since August 31, 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. A-12 The reorganization of each of JPMorgan Institutional Federal Money Market Fund, a series of the Transferor Trust, and JPMorgan Federal Money Market 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. (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 October 31, 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 Fleming Asset Management (USA) Inc. ("JPMFAM"), 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. A-13 The reorganization of each of JPMorgan Institutional Federal Money Market Fund, a series of the Transferor Trust, and JPMorgan Federal Money Market 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 respective 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 JPMFAM 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 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 J.P. Morgan Investment Management Inc. ("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 A-14 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. 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: if to the Acquiring Trust (for itself or on behalf of the Acquiring Portfolio): 1211 Avenue of the Americas, 41st Floor New York, New York 10036 with a copy to: Simpson Thacher & Bartlett 425 Lexington Avenue New York, New York 10017 Attention: Sarah E. Cogan, Esq. if to the Transferor Trust (for itself or on behalf of the Transferor Portfolio): 60 State Street Suite 1300 Boston, Massachusetts 02109 A-15 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 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 Transferor Trust must look solely to the Transferor Trust's property for the enforcement of any claims against the Transferor Trust, as none of the Transferor Trustees, officers, agents or shareholders assumes any personal liability for obligations entered into on behalf of the Transferor Trust. No series of the Transferor Trust shall be liable for claims against any other series of the Transferor Trust. (f) The name "Mutual Fund Trust" is the designation of its Trustees under a Declaration of Trust dated February 1, 1994, 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-16 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 Service Federal Money Market Fund By: -------------------------------------------------- Name: Title: MUTUAL FUND TRUST on behalf of JPMorgan Federal Money Market Fund II By: -------------------------------------------------- Name: Title: Agreed and acknowledged with respect to Section 9: J.P. MORGAN CHASE & CO. By: -------------------------------------------------- Name: Title: A-17 STATEMENT OF ADDITIONAL INFORMATION (SPECIAL MEETING OF SHAREHOLDERS OF J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND, 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 16, 2001 for the Special Meeting of Shareholders of J.P. Morgan Institutional Service Federal Money Market Fund (the "Merging Fund"), a series of J.P. Morgan Institutional Funds ("JPMIF"), to be held on July 3, 2001. Copies of the Combined Prospectus/Proxy Statement may be obtained at no charge by calling the Merging Fund at 1-800-766-7722. 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 each of MFT's and JPMIF's Statements of Additional Information, which are incorporated herein by reference. The date of this Statement of Additional Information is May 16, 2001. 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 JPMIF, on behalf of the Merging Fund, MFT, 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 MFT 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 Premier Class shares of the Surviving 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 JPMIF. 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 the Merging Fund and the Surviving Fund contained in their Annual Reports dated October 31, 2000 and August 31, 2000, respectively, are incorporated by reference into this Statement of Additional Information related to this Combined Prospectus/Proxy Statement. The audited financial statements, notes thereto and supplementary data of the Master Portfolio contained in its Annual Report dated October 31, 2000 are incorporated by reference into this Statement of Additional Information related to this Combined Prospectus/Proxy Statement. The financial highlights, financial statements, notes thereto and supplementary data, as applicable, which appear in each of the Merging Fund's, the Master Portfolio's and the Surviving 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 and the Master Portfolio for the fiscal year ended October 31, 2000 and for the Surviving Fund for the fiscal year ended August 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 Surviving Fund for the fiscal period ended February 28, 2001, are incorporated by reference herein and into the Statement of Additional Information related to this Combined Prospectus/Proxy Statement. -3- PRO FORMA FINANCIAL STATEMENTS The Federal Money Market Portfolio / JPMorgan Federal Money Market Fund II Proforma Combining Schedule of Portfolio Investments February 28, 2001 (Amounts in Thousands)
PRINCIPAL AMOUNT --------------------------------------------------------- PRO FORMA THE COMBINED JPMORGAN FEDERAL MONEY JPMORGAN FEDERAL MONEY MARKET PRO FORMA FEDERAL MONEY MARKET FUND II PORTFOLIO ADJUSTMENTS MARKET FUND -------------- --------- ----------- -------- MONEY MARKET INSTRUMENTS 101.77% U.S. GOVERNMENT AGENCY SECURITIES 94.7% FEDERAL FARM CREDIT BANK - 15.67% Federal Farm Credit Bank, 5.13%, 04/02/01 $ 2,075 $ 2,075 5.32%, 03/01/01 250,000 250,000 5.35%, 03/25/01 100,000 100,000 5.38%, 03/11/01 100,000 100,000 5.40%, 03/10/01 25,000 25,000 5.88%, 07/02/01 50,000 50,000 6.60%, 03/01/01 88,300 88,300 DN, 4.26%, 03/05/01 1,375 1,375 DN, 4.82%, 08/27/01 15,000 15,000 DN, 5.04%, 04/06/01 38,925 38,925 DN, 5.07%, 01/09/02 50,000 50,000 DN, 5.09%, 03/29/01 14,000 14,000 DN, 5.13%, 03/26/01 20,195 20,195 DN, 5.21%, 03/09/01 72,580 72,580 DN, 5.39%, 03/05/01 20,000 20,000 FRN, 6.45%, 05/01/01 100,000 100,000 FEDERAL HOME LOAN BANK - 78.21% Federal Home Loan Bank, 5.12%, 01/16/02 20,000 20,000 5.31%, 05/01/01 100,000 100,000 5.34%, 03/26/01 100,000 100,000 5.37%, 03/15/01 100,000 100,000 5.39%, 03/17/01 50,000 50,000 5.47%, 03/01/01 130,000 130,000 5.50%, 03/01/01 100,000 100,000 5.89%, 07/19/01 28,500 28,500 6.38%, 12/20/01 50,000 50,000 6.50%, 04/26/01 50,000 50,000 6.67%, 04/06/01 40,000 40,000 6.75%, 03/01/01 25,000 25,000 7.13%, 11/15/01 50,000 50,000 DN, 4.75%, 03/01/01 9,005 4,032 13,037 DN, 4.76%, 03/09/01 100,000 100,000 DN, 4.83%, 08/22/01 15,000 15,000 DN, 4.86%, 08/10/01 35,000 35,000 VALUE ------------------------------------------------------------- PRO FORMA COMBINED JPMORGAN JPMORGAN JPMORGAN FEDERAL MONEY FEDERAL MONEY PRO FORMA FEDERAL MONEY MARKET FUND II MARKET PORTFOLIO ADJUSTMENTS MARKET FUND -------------- ---------------- ----------- --------- MONEY MARKET INSTRUMENTS 101.77% U.S. GOVERNMENT AGENCY SECURITIES 94.7% FEDERAL FARM CREDIT BANK - 15.67% Federal Farm Credit Bank, 5.13%, 04/02/01 $ 2,072 $ 2,072 5.32%, 03/01/01 250,000 250,000 5.35%, 03/25/01 100,000 100,000 5.38%, 03/11/01 99,993 99,993 5.40%, 03/10/01 25,000 25,000 5.88%, 07/02/01 49,875 49,875 6.60%, 03/01/01 88,300 88,300 DN, 4.26%, 03/05/01 1,374 1,374 DN, 4.82%, 08/27/01 14,647 14,647 DN, 5.04%, 04/06/01 38,703 38,703 DN, 5.07%, 01/09/02 47,898 47,898 DN, 5.09%, 03/29/01 13,943 13,943 DN, 5.13%, 03/26/01 20,120 20,120 DN, 5.21%, 03/09/01 72,484 72,484 DN, 5.39%, 03/05/01 19,988 19,988 FRN, 6.45%, 05/01/01 99,992 99,992 ----------- 944,389 FEDERAL HOME LOAN BANK - 78.21% Federal Home Loan Bank, 5.12%, 01/16/02 19,986 19,986 5.31%, 05/01/01 99,975 99,975 5.34%, 03/26/01 99,966 99,966 5.37%, 03/15/01 99,968 99,968 5.39%, 03/17/01 49,989 49,989 5.47%, 03/01/01 129,965 129,965 5.50%, 03/01/01 99,999 99,999 5.89%, 07/19/01 28,477 28,477 6.38%, 12/20/01 50,000 50,000 6.50%, 04/26/01 49,992 49,992 6.67%, 04/06/01 40,000 40,000 6.75%, 03/01/01 25,000 25,000 7.13%, 11/15/01 50,325 50,325 DN, 4.75%, 03/01/01 9,005 4,032 13,037 DN, 4.76%, 03/09/01 99,881 99,881 DN, 4.83%, 08/22/01 14,656 14,656 DN, 4.86%, 08/22/01 34,252 34,252
See Notes to Pro Forma Financial Statements. -4- PRO FORMA FINANCIAL STATEMENTS The Federal Money Market Portfolio / JPMorgan Federal Money Market Fund II Proforma Combining Schedule of Portfolio Investments February 28, 2001 (Amounts in Thousands)
PRINCIPAL AMOUNT --------------------------------------------------------- PRO FORMA THE COMBINED JPMORGAN FEDERAL MONEY JPMORGAN FEDERAL MONEY MARKET PRO FORMA FEDERAL MONEY MARKET FUND II PORTFOLIO ADJUSTMENTS MARKET FUND -------------- --------- ----------- -------- DN, 4.86%, 08/10/01 35,000 35,000 DN, 4.89%, 08/15/01 101,345 101,345 DN, 4.90%, 08/24/01 62,762 62,762 DN, 4.92%, 08/01/01 33,895 33,895 DN, 4.95%, 08/03/01 40,000 40,000 DN, 5.03%, 03/16/01 86,350 86,350 DN, 5.03%, 04/04/01 148,312 148,312 DN, 5.07%, 05/02/01 70,439 70,439 DN, 5.09%, 04/06/01 11,480 11,480 DN, 5.11%, 04/25/01 74,798 74,798 DN, 5.13%, 03/21/01 213,513 213,513 DN, 5.16%, 04/11/01 25,000 25,000 DN, 5.18%, 04/17/01 96,199 96,199 DN, 5.18%, 07/06/01 90,000 90,000 DN, 5.19%, 04/27/01 23,216 23,216 DN, 5.21%, 03/07/01 150,000 150,000 DN, 5.22%, 04/27/01 60,000 60,000 DN, 5.23%, 03/01/01 300,000 300,000 DN, 5.25%, 03/28/01 50,000 50,000 DN, 5.26%, 04/20/01 149,056 149,056 DN, 5.29%, 04/18/01 97,656 97,656 DN, 5.36%, 03/02/01 50,000 50,000 DN, 5.38%, 03/02/01 100,000 100,000 DN, 5.46%, 03/22/01 50,000 50,000 DN, 5.77%, 06/01/01 7,313 7,313 DN, 5.84%, 05/11/01 24,345 24,345 DN, 5.85%, 04/09/01 121,000 121,000 DN, 5.88%, 06/27/01 150,000 150,000 DN, 5.95%, 05/11/01 75,000 75,000 DN, 6.03%, 05/01/01 75,000 75,000 DN, 6.23%, 04/16/01 51,564 51,564 DN, 6.37%, 05/04/01 50,000 50,000 DN, 6.51%, 03/15/01 25,000 25,000 DN, 6.55%, 04/09/01 25,000 25,000 DN, 6.55%, 09/13/01 25,000 25,000 DN, 6.57%, 04/20/01 25,000 25,000 DN, 6.63%, 08/31/01 25,000 25,000 FRN, 5.14%, 03/05/01 98,000 98,000 FRN, 5.24%, 05/10/01 50,000 50,000 FRN, 5.39%, 03/20/01 100,000 100,000 FRN, 5.40%, 03/15/01 160,000 160,000 FRN, 5.45%, 02/21/02 100,000 100,000 FRN, 5.45%, 03/01/01 160,000 160,000 FRN, 5.48%, 7/18/01 50,000 50,000 VALUE ------------------------------------------------------------- PRO FORMA COMBINED JPMORGAN JPMORGAN JPMORGAN FEDERAL MONEY FEDERAL MONEY PRO FORMA FEDERAL MONEY MARKET FUND II MARKET PORTFOLIO ADJUSTMENTS MARKET FUND -------------- ---------------- ----------- --------- DN, 4.86%, 08/10/01 34,252 34,252 DN, 4.89%, 08/15/01 99,074 99,074 DN, 4.90%, 08/24/01 61,288 61,288 DN, 4.92%, 08/01/01 33,196 33,196 DN, 4.95%, 08/03/01 39,166 39,166 DN, 5.03%, 03/16/01 86,153 86,153 DN, 5.03%, 04/04/01 147,453 147,453 DN, 5.07%, 05/02/01 69,821 69,821 DN, 5.09%, 04/06/01 11,420 11,420 DN, 5.11%, 04/25/01 74,208 74,208 DN, 5.13%, 03/21/01 212,796 212,796 DN, 5.16%, 04/11/01 24,851 24,851 DN, 5.18%, 04/17/01 95,540 95,540 DN, 5.18%, 07/06/01 88,397 88,397 DN, 5.19%, 04/27/01 23,027 23,027 DN, 5.21%, 03/07/01 149,858 149,858 DN, 5.22%, 04/27/01 59,499 59,499 DN, 5.23%, 03/01/01 300,000 300,000 DN, 5.25%, 03/28/01 49,797 49,797 DN, 5.26%, 04/20/01 147,955 147,955 DN, 5.29%, 04/18/01 96,960 96,960 DN, 5.36%, 03/02/01 49,993 49,993 DN, 5.38%, 03/02/01 99,985 99,985 DN, 5.46%, 03/22/01 49,842 49,842 DN, 5.77%, 06/01/01 7,206 7,206 DN, 5.84%, 05/11/01 24,064 24,064 DN, 5.85%, 04/09/01 120,219 120,219 DN, 5.88%, 06/27/01 147,139 147,139 DN, 5.95%, 05/11/01 74,139 74,139 DN, 6.03%, 05/01/01 74,250 74,250 DN, 6.23%, 04/16/01 51,148 51,148 DN, 6.37%, 05/04/01 49,449 49,449 DN, 6.51%, 03/15/01 24,941 24,941 DN, 6.55%, 04/09/01 24,833 24,833 DN, 6.55%, 09/13/01 24,163 24,163 DN, 6.57%, 04/20/01 24,786 24,786 DN, 6.63%, 08/31/01 24,210 24,210 FRN, 5.14%, 03/05/01 98,000 98,000 FRN, 5.24%, 05/10/01 49,995 49,995 FRN, 5.39%, 03/20/01 99,977 99,977 FRN, 5.40%, 03/15/01 159,955 159,955 FRN, 5.45%, 02/21/02 99,981 99,981 FRN, 5.45%, 03/01/01 159,970 159,970 FRN, 5.48%, 7/18/01 49,987 49,987
See Notes to Pro Forma Financial Statements. -5- PRO FORMA FINANCIAL STATEMENTS The Federal Money Market Portfolio / JPMorgan Federal Money Market Fund II Proforma Combining Schedule of Portfolio Investments February 28, 2001 (Amounts in Thousands)
PRINCIPAL AMOUNT --------------------------------------------------------- PRO FORMA THE COMBINED JPMORGAN FEDERAL MONEY JPMORGAN FEDERAL MONEY MARKET PRO FORMA FEDERAL MONEY MARKET FUND II PORTFOLIO ADJUSTMENTS MARKET FUND -------------- --------- ----------- -------- FRN, 5.52%, 04/19/01 125,000 125,000 FRN, 5.52%, 10/19/01 50,000 50,000 MTN, FRN, 5.47%, 03/20/01 75,000 75,000 FEDERAL HOME LOAN MORTGAGE COMPANY - 0.82% Federal Home Loan Mortgage Company, DN, 5.13%, 03/19/01 25,000 25,000 DN, 5.57%, 03/08/01 24,790 24,790 STUDENT LOAN MARKETING ASSOCIATION - 6.15% Student Loan Marketing Association, DN, 5.00%, 03/01/01 6,175 6,175 DN, 5.05%, 03/30/01 30,000 30,000 DN, 6.02%, 04/02/01 93,750 93,750 FRN, 5.25%, 11/15/01 50,000 50,000 FRN, 5.28%, 07/19/01 28,200 28,200 FRN, 5.35%, 08/23/01 113,000 113,000 MTN, FRN, 5.25%, 09/13/01 50,000 50,000 STATE AND MUNICIPAL OBLIGATIONS - 0.91% Tennessee Valley Authority, DN, 4.28%, 03/05/01 55,000 55,000 TOTAL INVESTMENTS - 101.77% $1,903,421 $4,257,724 $ 6,161,145 VALUE ------------------------------------------------------------- PRO FORMA COMBINED JPMORGAN THE JPMORGAN FEDERAL MONEY FEDERAL MONEY PRO FORMA FEDERAL MONEY MARKET FUND II MARKET PORTFOLIO ADJUSTMENTS MARKET FUND -------------- ---------------- ----------- --------- FRN, 5.52%, 04/19/01 124,946 124,946 FRN, 5.52%, 10/19/01 49,978 49,978 MTN, FRN, 5.47%, 03/20/01 74,998 74,998 ----------- 4,714,076 FEDERAL HOME LOAN MORTGAGE COMPANY - 0.82% Federal Home Loan Mortgage Company, DN, 5.13%, 03/19/01 24,933 24,933 DN, 5.57%, 03/08/01 24,759 24,759 ----------- 49,692 STUDENT LOAN MARKETING ASSOCIATION - 6.15% Student Loan Marketing Association, DN, 5.00%, 03/01/01 6,175 6,175 DN, 5.05%, 03/30/01 29,874 29,874 DN, 6.02%, 04/02/01 93,236 93,236 FRN, 5.25%, 11/15/01 50,000 50,000 FRN, 5.28%, 07/19/01 28,198 28,198 FRN, 5.35%, 08/23/01 113,011 113,011 MTN, FRN, 5.25%, 09/13/01 49,984 49,984 ----------- 370,478 STATE AND MUNICIPAL OBLIGATIONS - 0.91% Tennessee Valley Authority, DN, 4.28%, 03/05/01 54,967 54,967 TOTAL INVESTMENTS - 101.77% $ 1,893,759 $ 4,239,843 $ 6,133,602 (COST $1,893,759) (COST $4,239,843)
DN - Discount Notes: The rate shown is the effective yield at the date of purchase. FRN - Floating Rate Note: The maturity date is the actual maturity date; the rate shown is the rate in effect at February 28, 2001. MTN - Medium Term Notes See Notes to Pro Forma Financial Statements. -6- J.P. MORGAN FEDERAL MONEY MARKET PORTFOLIO / CHASE VISTA FEDERAL MONEY MARKET FUND II PRO FORM COMBINING STATEMENT OF ASSETS AND LIABILITIES AS OF FEBRUARY 28, 2001 (UNAUDITED) (AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
J.P. MORGAN J.P. MORGAN J.P. MORGAN FEDERAL MONEY INSTITUTIONAL INSTITUTIONAL MARKET FUND FEDERAL MONEY SERVICE FEDERAL MARKET FUND MONEY MARKET FUND ASSETS: Investment securities, at value $ - $ - $ - Investment in The Federal Money Market Portfolio ("Portfolio"), at value 1,929,099 2,206,876 17,331 Cash - - - Deferred organization cost - - 4 Other assets 1 331 37 Receivables: Interest - - - Expenses reimbursement from distributor - - - --------------------------------------- Total Assets 1,929,100 2,207,207 17,372 --------------------------------------- LIABILITIES: Payables: Investment securities purchased - - - Dividends 8,054 9,268 116 Other 5 (0) - Accrued liabilities: Investment advisory fees - - Administrative service fees 374 168 9 Administration fees 37 41 5 Shareholder servicing fees - - - Custodian fees - - - Distribution fees - - - Other 40 82 70 --------------------------------------- Total Liabilities 8,510 9,559 200 --------------------------------------- NET ASSETS: Paid-in capital 1,920,549 2,197,614 17,167 Accumulated undistributed (distributions in excess of ) net investment income 18 22 5 Accumulated net realized gain on investment transactions 23 12 - --------------------------------------- Net Assets $ 1,920,590 $ 2,197,648 $ 17,172 --------------------------------------- Shares of beneficial interest outstanding 1,920,547 2,197,615 17,167 Shares outstanding Vista (renamed Morgan) Premier Institutional (renamed Agency) Reserve Net Asset Value Per Share $ 1.00 $ 1.00 $ 1.00 PRO FORMA WITH CONCURRENT REORGANIZATION JPMORGAN FEDERAL MONEY MARKET FUND Shares outstanding Institutional Morgan Premier Agency Net Asset Value: Agency Investor Premier Institutional --------------------------------------- Cost of investments - - - ======================================= J.P. MORGAN FEDERAL JPMORGAN FEDERAL MONEY MONEY MARKET PORTFOLIO MARKET FUND ASSETS: Investment securities, at value $ 4,239,843 $ 1,893,759 Investment in The Federal Money Market Portfolio ("Portfolio"), at value - - Cash 32 1 Deferred organization cost - - Other assets 4 7 Receivables: Interest 11,986 6,762 Expenses reimbursement from distributor - 7 ----------------- -------------- Total Assets 4,251,865 1,900,536 ----------------- -------------- LIABILITIES: Payables: Investment securities purchased 98,000 - Dividends - 7,618 Other - - Accrued liabilities: Investment advisory fees 412 143 Administrative service fees 1 - Administration fees 81 143 Shareholder servicing fees - 246 Custodian fees 25 38 Distribution fees - 52 Other 40 519 ----------------- -------------- Total Liabilities 98,559 8,759 ----------------- -------------- NET ASSETS: Paid-in capital - 1,891,793 Accumulated undistributed (distributions in excess of ) net investment income - (35) Accumulated net realized gain on investment transactions - 19 ----------------- -------------- Net Assets $ 4,153,306 $ 1,891,777 ----------------- -------------- Shares of beneficial interest outstanding Shares outstanding 673,027 Vista (Renamed Morgan) 312,286 Premier 906,471 Institutional (Renamed Agency) 1 Reserve Net Asset Value Per Share $ 1.00 PRO FORMA WITH CONCURRENT REORGANIZATION JPMORGAN FEDERAL MONEY MARKET FUND Shares outstanding Institutional Morgan Premier Agency Net Asset Value: Agency Investor Premier Institutional ----------------- -------------- Cost of investments 4,239,843 $ 1,893,759 ================= ============== PRO FORMA PRO FORMA ADJUSTMENTS COMBINED JPMORGAN FEDERAL MONEY MARKET FUND ------------------ -------------- ASSETS: Investment securities, at value $ - $ 6,133,602 Investment in The Federal Money Market Portfolio ("Portfolio"), at value (4,153,306) (a) - Cash - 33 Deferred organization cost (4) (b) - Other assets 380 Receivables: - Interest - 18,748 Expenses reimbursement from distributor 4 (b) 11 ------------------- ------------- Total Assets (4,153,306) 6,152,774 ------------------- ------------- LIABILITIES: Payables: Investment securities purchased - 98,000 Dividends - 25,056 Other - 5 Accrued liabilities: Investment advisory fees - 555 Administrative service fees - 552 Administration fees - 307 Shareholder servicing fees - 246 Custodian fees - 63 Distribution fees - 52 Other - 711 ------------------- ------------- Total Liabilities - 125,547 ------------------- ------------- NET ASSETS: Paid-in capital - 6,027,123 Accumulated undistributed (distributions in excess of ) net investment income 10 Accumulated net realized gain on investment transactions - 54 ------------------- ------------- Net Assets $ (4,153,306) $ 6,027,187 ------------------- ------------- Shares of beneficial interest outstanding (4,135,329) (d) - Shares outstanding (673,027) (e) - Vista (Renamed Morgan (312,286) (e) - Premier (906,471) (e) - Institutional (Renamed Agency (1) (e) - Reserve Net Asset Value Per Share PRO FORMA WITH CONCURRENT REORGANIZATION JPMORGAN FEDERAL MONEY MARKET FUND Shares outstanding Institutional 2,197,615 (c) 2,197,615 Morgan 673,028 (c) 673,028 Premier 2,250,000 (c) 2,250,000 Agency 906,471 (c) 906,471 Net Asset Value: Agency $ 1.00 Morgan $ 1.00 Premier $ 1.00 Institutional $ 1.00 ------------------- ------------- Cost of investments - 6,133,602 =================== =============
(a) Reallocation of investment from the feeder funds to the master portfolio. (b) Write-off of deferred organization expenses of the portfolio. (c) Reflects the additional number of shares outstanding due to the Concurrent Reorganization. (d) Reallocation of feeder fund's beneficial interest to Agency, Investor, Premier, Institutional and Reserves Shares due to the Concurrent Reorganization. (e) Reallocation of JPMorgan Federal Money Market Fund II shares outstanding to Institutional, Morgan, Premier, and Agency due to the Concurrent Reorganization. See Notes to Pro Forma Financial Statements. -7- THE MORGAN FEDERAL MONEY MARKET PORTFOLIO / JPMORGAN FEDERAL MONEY MARKET FUND II PRO FORMA COMBINING STATEMENT OF OPERATIONS FOR THE TWELVE MONTHS ENDED FEBRUARY 28, 2001 (UNAUDITED) (AMOUNTS IN THOUSANDS)
J.P. MORGAN J.P. MORGAN J.P. MORGAN THE FEDERAL MONEY INSTITUTIONAL INSTITUTIONAL FEDERAL MONEY MARKET FUND FEDERAL MONEY SERVICE FEDERAL MARKET PORTFOLIO MARKET FUND MONEY MARKET FUND INCOME: Allocated investment income from portfolio $ 90,903 $ 117,347 $ 10,568 $ - Interest income 224,708 ------------------------------------------------------------------ Investment income 90,903 117,347 10,568 224,708 ------------------------------------------------------------------ EXPENSES: Investment advisory fees - - - 4,538 Administration fees 368 472 42 867 Shareholder servicing fees 3,679 1,895 74 - Financial and fund accounting services 20 20 20 - Distribution fees - - - - Custodian fees - - - 329 Registration costs 171 223 43 - Transfer agent fees 32 24 12 - Professional fees 18 20 11 54 Printing and postage 10 8 10 10 Trustees' fees 17 19 1 37 Fund service fees - 26 1 33 Service organization fees - - 432 - Amortization of organizational expenses - - 1 - Other 28 14 5 22 ------------------------------------------------------------------ Total expenses 4,343 2,721 652 5,890 ------------------------------------------------------------------ Less amounts waived - - - - Less earnings credit - - - - Less expense reimbursements - 2,091 169 - ------------------------------------------------------------------ Net expenses 4,343 630 483 5,890 ------------------------------------------------------------------ ------------------------------------------------------------------ Net investment income 86,560 116,717 10,085 218,818 ------------------------------------------------------------------ REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net Realized Gain on Investment Transactions 62 67 5 134 Net Unrealized Gain (Loss) on Investment Transactions - - - - ------------------------------------------------------------------ Net Increase in Net Assets from Operations 86,622 116,784 10,090 218,952 ================================================================== JPMORGAN PRO FORMA PRO FORMA FEDERAL MONEY ADJUSTMENTS COMBINED MARKET FUND II JPMORGAN FEDERAL MONEY MARKET FUND -------------- -------------- INCOME: Allocated investment income from portfolio $ - $ (218,818)(c) $ - Interest income 86,715 - 311,423 ---------------------------------------------------------- Investment income 86,715 (218,818) 311,423 ---------------------------------------------------------- EXPENSES: Investment advisory fees 1,380 (176) (a) 5,742 Administration fees 1,380 890 (a) 4,019 Shareholder servicing fees 3,304 168 (a) 9,120 Financial and fund accounting services - (60) (e) - Distribution fees 599 - 599 Custodian fees 131 296 (e) 756 Registration costs 53 - 490 Transfer agent fees 458 - 526 Professional fees 49 (24) (f) 128 Printing and postage 14 (10) (f) 42 Trustees' fees 68 - 142 Fund service fees - - 60 Service organization fees - - 432 Amortization of organizational expenses - 4 (d) 5 Other 5 - 74 ---------------------- --------------- ------------- Total expenses 7,441 1,088 22,135 ---------------------- --------------- ------------- Less amounts waived 546 1,088(a) 1,634 Less earnings credit 11 - 11 Less expense reimbursements 11 114(a) 2,385 ---------------------- --------------- ------------- Net expenses 6,873 (114) 18,105 ---------------------- --------------- ------------- ---------------------- --------------- ------------- Net investment income 79,842 (218,704) 293,318 ---------------------- --------------- ------------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain on investment transactions 73 (134)(b) 207 Net unrealized gain (loss) on investment transactions - - ---------------------- --------------- ------------- Net increase in net assets from operations 79,915 (218,838) 293,525 ====================== =============== =============
(a) Reflects adjustments to administrative fees and/or related waivers based on the surviving Fund's revised fee schedule. (b) Reflects the elimination of realized gain of the feeder funds. (c) Reallocation of investment income to feeder funds. (d) Reflects write-off of deferred organization expenses of the portfolio. (e) Reclassification of fund accounting into new combined custody fees. (f) Reduction reflects expected benefits of combined operations. See Notes to Pro Forma Financial Statements. -8- J.P. MORGAN FEDERAL MONEY MARKET FUND /J.P. MORGAN INSTITUTIONAL FEDERAL MONEY MARKET FUND/ J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND / THE FEDERAL MONEY MARKET PORTFOLIO / JPMORGAN FEDERAL MONEY MARKET FUND II 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 Federal Money Market Portfolio ("Master Portfolio"), J.P. Morgan Federal Money Market Fund ("Federal Money Market Fund"), J.P. Morgan Institutional Service Federal Money Market Fund ("Institutional Service") and J.P. Morgan Institutional Money Market Fund ("Institutional"), (collectively the "feeder funds" of the Master Portfolio) and JPMorgan Federal Money Market Fund II ("JPMFMF") as if the proposed Concurrent Reorganization occurred as of and for the twelve months ended February 28, 2001. Under the Concurrent Reorganization, the Pro Forma Statements give effect to the proposed transfer of all assets and liabilities of the Master Portfolio and the feeder funds in exchange for shares in JPMFMF. The Pro Forma Statements should be read in conjunction with the historical financial statements of each Fund, which have been incorporated by reference in their respective Statements of Additional Information. 2. SHARES OF BENEFICIAL INTEREST: Immediately prior to the Concurrent Reorganization, JPMFMF would commence offering Institutional Shares. The net asset value per share for the Institutional Shares at the commencement of offering would be identical to the closing net asset value per share for the Premier Shares immediately prior to Concurrent Reorganization. Under the Concurrent Reorganization, the existing shares of the Federal Money Market Fund and Institutional Service Fund would be renamed Premier Class Shares and the Institutional Fund would be renamed Institutional Class shares. The net asset values per share for the Premier and Institutional Class Shares at the commencement of offering would be identical to the closing net asset value per share for the Premier Shares immediately prior to the Reorganization. In addition, the Chase Vista and Reserve Class shares will combine and be renamed the Morgan Class and the Chase Institutional Class shares will be renamed Agency Class Shares. Under the proposed Concurrent Reorganization, each shareholder of the Federal Money Market Fund, Institutional Service Fund and the Institutional Class Fund would receive shares of JPMFMF with a value equal to their holdings in their respective funds. Holders of the Federal Money Market Fund and Institutional Service will receive Premier Class Shares in JPMFMF and holders of the Institutional Fund will receive Institutional Class shares. Therefore, as a result of the proposed Concurrent Reorganization, current shareholders of Federal Money Market Fund, Institutional Service Fund and Institutional Fund will become shareholders of JPMFMF. -9- The Pro Forma net asset value per share assumes the issuance of additional shares of JPMFMF, which would have been issued on February 28, 2001 in connection with the proposed Concurrent Reorganization. The amount of additional shares assumed to be issued was calculated based on the February 28, 2001 net assets of Federal Money Market Fund, Institutional Service and Institutional Class and the net asset value per share of JPMFMF- Premier Class. JPMORGAN FEDERAL MONEY MARKET FUND WITH CONCURRENT REORGANIZATION
Premier Class Shares Increase in Shares Issued 1,937,714 Proforma Net Assets 2/28/01 $2,250,039 Pro Forma Net Asset Value 2/28/01 $1.00
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. The pro forma investment advisory, administration, shareholder servicing and distribution fees of the combined Fund and/or the related waivers are based on the fee schedule in effect for the Surviving Fund at the combined level of average net assets for the twelve months ended February 28, 2001. -10- FORM N-14 PART C - OTHER INFORMATION Item 15. Indemnification. Reference is hereby made to Article V of the Registrant's Declaration of Trust. The Trustees and officers of the Registrant and the personnel of the Registrant's investment adviser, administrator and distributor are insured under an errors and omissions liability insurance policy. The Registrant and its officers are also insured under the fidelity bond required by Rule 17g-1 under the Investment Company Act of 1940. Under the terms of the Registrant's Declaration of Trust, the Registrant may indemnify any person who was or is a Trustee, officer or employee of the Registrant to the maximum extent permitted by law; provided, however, that any such indemnification (unless ordered by a court) shall be made by the Registrant only as authorized in the specific case upon a determination that indemnification of such persons is proper in the circumstances. Such determination shall be made (i) by the Trustees, by a majority vote of a quorum which consists of Trustees who are neither described in Section 2(a)(19) of the Investment Company Act of 1940 nor parties to the proceeding, or (ii) if the required quorum is not obtainable or, if a quorum of such Trustees so directs, by independent legal counsel in a written opinion. No indemnification will be provided by the Registrant to any Trustee or officer of the Registrant for any liability to the Registrant or shareholders to which he would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of duty. Insofar as the conditional advancing of indemnification monies for actions based upon the Investment Company Act of 1940 may be concerned, such payments will be made only on the following conditions: (i) the advances must be limited to amounts used, or to be used, for the preparation or presentation of a defense to the action, including costs connected with the preparation of a settlement; (ii) advances may be made only upon receipt of a written promise by, or on behalf of, the recipient to repay that amount of the advance which exceeds that amount to which it is ultimately determined that he is entitled to receive from the Registrant by reason of indemnification; and (iii) (a) such promise must be secured by a surety bond, other suitable insurance or an equivalent form of security which assures that any repayments may be obtained by the Registrant without delay or litigation, which bond, insurance or other form of security must be provided by the recipient of the advance, or (b) a majority of a quorum of the Registrant's disinterested, non-party Trustees, or an independent legal counsel in a written opinion, shall determine, based upon a review of readily available facts, that the recipient of the advance ultimately will be found entitled to indemnification. Insofar as indemnification for liability arising under the Securities Act of 1933 may be permitted to trustees, officers and controlling persons of the Registrant 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 Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities Part C-1 (other than the payment by the Registrant of expenses incurred or paid by a trustee, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such trustee, officer or controlling person in connection with the securities 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 Act and will be governed by the final adjudication of such issue. Item 16. Exhibits. Declaration of Trust. 1 Declaration of Trust, as amended. (1) 2 By-laws. (1) 3 None. 4 Agreement and Plan of Reorganization filed herewith as Appendix A to the Combined Prospectus/Proxy Statement. 5 None. 6 Form of Investment Advisory Agreement.(6) 7 Distribution and Sub-Administration Agreement dated August 21, 1995.(6) 8(a) Retirement Plan for Eligible Trustees.(6) 8(b) Deferred Compensation Plan for Eligible Trustees.(6) 9 Custodian Agreement. (1) 10(a) Rule 12b-1 Distribution Plan of Mutual Funds including Selected Dealer Agreement and Shareholder Service Agreement. (1) and (3) 10(b) Rule 12b-1 Distribution Plan - Class B Shares (including forms of Selected Dealer Agreement and Shareholder Servicing Agreement).(6) 10(c) Form of Rule 12b-1 Distribution Plan - Class C Shares (including forms of Shareholder Servicing Agreements).(12) 10(d) Form of Rule 18f-3 Multi-Class Plan.(12) 11 Opinion and Consent of Nixon Peabody LLP as to the Legality of Shares to be filed by Amendment. Part C-2 12 Opinion and Consent of Simpson Thacher & Bartlett as to Tax Consequences to be filed by Amendment. 13(a) Transfer Agency Agreement. (1) 13(b) Form of Shareholder Servicing Agreement. (6) 13(c) Form of Administration Agreement.(6) 13(d) Form of Administration Agreement (to be filed by Amendment). 13(e) Form of Sub-Administration Agreement (to be filed by Amendment). 14 Consent of PricewaterhouseCoopers LLP. 15 None. 16(a) Powers of Attorney for: Fergus Reid, III, H. Richard Vartabedian, William J. Armstrong, John R.H. Blum, Stuart W. Cragin, Jr., Roland R. Eppley, Jr., Joseph J. Harkins, W.D. MacCallan, W. Perry Neff, Richard E. Ten Haken, Irving L. Thode. 16(b) Powers of Attorney for: Sarah E. Jones and Leonard M. Spalding, Jr. 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 dated August 31, 2000. 17(g) Semi-Annual Report of the Surviving Fund dated February 28, 2001 to be filed by Amendment. 17(h) Annual Report of the Merging Fund (including the Annual Report of the Master Portfolio) dated October 31, 2000. - ----------------- (1) Filed as an Exhibit to the Registration Statement on Form N-1A of the Registrant (File No. 33-75250) as filed with the Securities and Exchange Commission on February 14, 1994. (2) Filed as an Exhibit to Post-Effective Amendment No. 1 to the Registration Statement on Form N-1A of the Registrant (File No. 33-75250) as filed with the Securities and Part C-3 Exchange Commission on August 29, 1994. (3) Filed as an Exhibit to Post-Effective Amendment No. 2 to the Registration Statement on Form N-1A of the Registrant (File No. 33-75250) as filed with the Securities and Exchange Commission on October 28, 1994. (4) Filed as an Exhibit to Post-Effective Amendment No. 3 to the Registration Statement on Form N-1A of the Registrant (File No. 33- 75250) as filed with the Securities and Exchange Commission on October 31, 1995. (5) Filed as an Exhibit to Post-Effective Amendment No. 4 to the Registration Statement on Form N-1A of the Registrant as filed with the Securities and Exchange Commission on December 28, 1995. (6) Filed as an Exhibit to Post-Effective Amendment No. 5 to the Registration Statement on Form N-1A of the Registrant as filed with the Securities and Exchange Commission on March 7, 1996. (7) Filed as an Exhibit to Post-Effective Amendment No. 6 to the Registration Statement on Form N-1A of the Registrant as filed with the Securities and Exchange Commission on April 22, 1996. (8) Filed as an exhibit to Post-Effective Amendment No. 7 to the Registration Statement on Form N-1A of the Registrant as filed with the Securities and Exchange Commission on September 6, 1996. (9) Filed as an exhibit to Post-Effective Amendment No. 8 to the Registration Statement on Form N-1A of the Registrant as filed with the Securities and Exchange Commission on December 27, 1996. (10) Filed herewith. (11) Filed as an exhibit to Post-Effective Amendment No. 10 to the Registration Statement on Form N-1A of the Registrant as filed with the Securities and Exchange Commission on October 27, 1997. 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 Part C-4 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 16th day of April, 2001. MUTUAL FUND TRUST Registrant By: /S/ H. RICHARD VARTABEDIAN ----------------------------------------- H. Richard Vartabedian President 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 16, 2001. * Chairman and Trustee - ------------------------------------ Fergus Reid, III /S/ H. RICHARD VARTABEDIAN President - ------------------------------------ H. Richard Vartabedian and Trustee * Trustee - ------------------------------------ William J. Armstrong * Trustee - ------------------------------------ John R.H. Blum * Trustee - ------------------------------------ Stuart W. Cragin, Jr. * Trustee - ------------------------------------ Roland R. Eppley, Jr. * Trustee - ------------------------------------ Joseph J. Harkins * Trustee - ------------------------------------ Sarah E. Jones * Trustee - ------------------------------------ W.D. MacCallan * Trustee - ------------------------------------ W. Perry Neff * Trustee - ------------------------------------ Leonard M. Spalding, Jr. * Trustee - ------------------------------------ Irv Thode * Trustee - ------------------------------------ Richard E. Ten Haken /s/ Martin R. Dean Treasurer and - ------------------------------------ Martin R. Dean Principal Financial Officer /s/ H. Richard Vartabedian Attorney in Fact - ------------------------------------ H. Richard Vartabedian EXHIBITS ITEM DESCRIPTION (14) Consent of PricewaterhouseCoopers LLP. (16) Powers of Attorney. (17)(a) Form of Proxy Card. (c) Prospectus for J.P. Morgan Institutional Service Federal Money Market Fund. (e) Statement of Additional Information for J.P. Morgan Institutional Service Federal Money Market Fund. (f) Annual Report of JPMorgan Federal Money Market Fund II (formerly, Chase Vista Federal Money Market Fund) dated August 31, 2000. (h) Annual Report of J.P. Morgan Institutional Service Federal Money Market Fund (including the Annual Report of The Federal Money Market Portfolio) dated October 31, 2000. EX-99.14 2 a2044397zex-99_14.txt EXHIBIT 99.14 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Combined Prospectus/Proxy Statement and Statement of Additional Information constituting parts of this registration statement on Form N-14 (the "N-14 Registration Statement") of our report dated October 11, 2000, relating to the August 31, 2000 financial statements and financial highlights of JPMorgan Federal Money Market Fund II (formerly, Chase Vista Federal Money Market Fund), which appear in the August 31, 2000 Annual Report to Shareholders, which are also incorporated by reference into the N-14 Registration Statement. We also consent to the references to us under the headings "Certain Arrangements with Service Providers- Other Services," "Accountants," "Financial Statements and Experts" and "Financial Statements" in such Registration Statement. We also consent to the references to us under the headings "Financial Highlights," "Independent Accountants" and "Financial Statements" in JPMorgan Federal Money Market Fund II's registration statement on Form N-1A, dated December 29, 2000 (revised March 9, 2001), which is incorporated by reference into this N-14 Registration Statement. PricewaterhouseCoopers LLP 1177 Avenue of the Americas New York, NY 10036 April 12, 2001 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the incorporation by reference in the Combined Prospectus/Proxy Statement and Statement of Additional Information constituting parts of this registration statement on Form N-14 (the "N-14 Registration Statement") of our reports dated December 21, 2000, relating to the October 31, 2000 financial statements and financial highlights of J.P. Morgan Institutional Service Federal Money Market Fund and the financial statements and supplemental data of The Federal Money Market Portfolio, which appear in the October 31, 2000 Annual Reports to Shareholders, which are also incorporated by reference into the N-14 Registration Statement. We also consent to the references to us under the headings "Certain Arrangements with Service Providers- Other Services," "Accountants," "Financial Statements and Experts" and "Financial Statements" in such Registration Statement. We also consent to the references to us under the headings "Financial Highlights," "Independent Accountants" and "Financial Statements" in J.P. Morgan Institutional Service Federal Money Market Fund's registration statement on Form N-1A, dated March 1, 2001, which is incorporated by reference into this N-14 Registration Statement. PricewaterhouseCoopers LLP 1177 Avenue of the Americas New York, NY 10036 April 12, 2001 EX-99.16 3 a2044397zex-99_16.txt EXHIBIT 99.16 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY Fergus Reid, III, whose signature appears below, hereby constitutes and appoints Martin R. Dean, Peter B. Eldridge and H. Richard Vartabedian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ Fergus Reid III ------------------- Fergus Reid, III Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY William J. Armstrong, whose signature appears below, hereby constitutes and appoints Martin D. Dean, Peter B. Eldridge and H. Richard Vartabedian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ William J. Armstrong ------------------------ William J. Armstrong Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY John R. H. Blum, whose signature appears below, hereby constitutes and appoints Martin R. Dean, Peter B. Eldridge and H. Richard Vartabedian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ John R. H. Blum -------------------------- John R. H. Blum Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY Stuart W. Cragin, Jr., whose signature appears below, hereby constitutes and appoints Martin R. Dean, Peter B. Eldridge and H. Richard Vartabedian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ Stuart W. Cragin, Jr. ------------------------- Stuart W. Cragin, Jr. Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY Roland R. Eppley, Jr., whose signature appears below, hereby constitutes and appoints Martin R. Dean, Peter B. Eldridge and H. Richard Vartabdian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ Roland R. Eppley, Jr. ------------------------- Roland R. Eppley, Jr. Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY Joseph J. Harkins, whose signature appears below, hereby constitutes and appoints Martin R. Dean, Peter B. Eldridge and H. Richard Vartabedian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ Joseph J. Harkins --------------------- Joseph J. Harkins Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY Sarah E. Jones, whose signature appears below, hereby constitutes and appoints Martin D. Dean, Peter B. Eldridge and H. Richard Vartabedian, and each of them, her true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ Sarah E. Jones ------------------ Sarah E. Jones Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY W.D. MacCallan, whose signature appears below, hereby constitutes and appoints Martin R. Dean, Peter B. Eldridge and H. Richard Vartabedian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ W.D. MacCallan ------------------ W.D. MacCallan Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY W. Perry Neff, whose signature appears below, hereby constitutes and appoints Martin R. Dean, Peter B. Eldridge and H. Richard Vartabedian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ W. Perry Neff ----------------- W. Perry Neff Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY Leonard M. Spalding, Jr., whose signature appears below, hereby constitutes and appoints Martin R. Dean, Peter B. Eldridge and H. Richard Vartabdian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ Leonard M. Spalding, Jr. ---------------------------- Leonard M. Spalding, Jr. Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY Irving L.Thode, whose signature appears below, hereby constitutes and appoints Martin R. Dean, Peter B. Eldridge and H. Richard Vartabedian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ Irving L. Thode ------------------- Irving L. Thode Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY Richard E. Ten Haken, whose signature appears below, hereby constitutes and appoints Martin R. Dean, Peter B. Eldridge and H. Richard Vartabdian, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ Richard E. Ten Haken ------------------------ Richard E. Ten Haken Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY H. Richard Vartabedian, whose signature appears below, hereby constitutes and appoints Martin R. Dean and Peter B. Eldridge, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ H. Richard Vartabedian -------------------------- H. Richard Vartabedian Date: April 3, 2001 Exhibit 16 MUTUAL FUND GROUP MUTUAL FUND TRUST MUTUAL FUND VARIABLE ANNUITY TRUST MUTUAL FUND SELECT GROUP MUTUAL FUND SELECT TRUST MUTUAL FUND INVESTMENT TRUST MUTUAL FUND MASTER INVESTMENT TRUST CAPITAL GROWTH PORTFOLIO GROWTH AND INCOME PORTFOLIO INTERNATIONAL EQUITY PORTFOLIO POWER OF ATTORNEY George E. McDavid, whose signature appears below, hereby constitutes and appoints Martin R. Dean and Peter B. Eldridge, and each of them, his true and lawful attorneys and agents, with full power and authority of substitution and resubstitution, to do any and all acts and things and to execute any and all instruments which said attorneys and agents, or any of them, may deem necessary or advisable or which may be required to enable any of the investment companies listed above (each, a "Company") to comply with the Investment Company Act of 1940, as amended, and the Securities Act of 1933, as amended (collectively, the "Acts"), and any rules, regulations or requirements of the Securities and Exchange Commission in respect thereof, in connection with the filing and effectiveness of any and all amendments (including post-effective amendments) to a Company's Registration Statement on Form N-1A and any other registration statements pursuant to said Acts, including specifically, but without limiting the generality of the foregoing, the power and authority to sign in the name and on behalf of the undersigned as a trustee and/or officer of a Company any and all such amendments and registration statements filed with the Securities and Exchange Commission under said Acts, and any other instruments or documents related thereto, and the undersigned does hereby ratify and confirm all that said attorneys and agents, or any of them, shall do or cause to be done by virtue hereof. /s/ George E. McDavid --------------------- George E. McDavid Date: April 3, 2001 EX-99.17(A) 4 a2044397zex-99_17a.txt EXHIBIT 99.17(A) FORM OF PROXY Preliminary Proxy Material J.P. MORGAN INSTITUTIONAL FUNDS JPMORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND This proxy is solicited on behalf of the Board of Trustees of JPMorgan Institutional Funds for the Special Meeting of the Shareholders to be held on July 3, 2001. The undersigned hereby appoints ___, ___ AND ___, and each of them, attorneys and proxies for the undersigned, with full power of substitution, and revocation to represent the undersigned and to vote on behalf of the undersigned all shares of J.P. Morgan Institutional Service Federal Money Market Fund which the undersigned is entitled to vote at the Special Meeting of Shareholders to be held at J.P. Morgan Chase & Co., 1211 Avenue of the Americas, 41st Floor, New York, NY, on July 3, 2001, at 9:00 a.m., and at any adjournments thereof. The undersigned hereby acknowledges receipt of the Notice of the Special Meeting of Shareholders and hereby instructs said attorneys and proxies to vote said shares as indicated hereon. In their discretion, the proxies are authorized to vote upon such other business as may properly come before the Special Meeting of Shareholders in person or by substitute (or, if only one shall be so present, then that one) shall have and may exercise all of the power and authority of said proxies hereunder. The undersigned hereby revokes any proxy previously given. NOTE: Please sign exactly as your name appears on this proxy. If joint owners, EITHER may sign this proxy. When signing as attorney, executor, administrator, trustee, guardian or corporate officer, please give your full title. DATE______________ ___, ____ ____________________________ ____________________________ Signature(s), Title(s) (if applicable) PLEASE SIGN, DATE AND RETURN PROMPTLY IN THE ENCLOSED ENVELOPE OR YOU CAN VOTE BY CALLING ________________________________. J.P. MORGAN INSTITUTIONAL FUNDS JPMORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND PLEASE INDICATE YOUR VOTE BY AN "X" ON THE APPROPRIATE LINE BELOW. This proxy, if properly executed, will be voted in the manner directed by the shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR EACH PROPOSAL. Please refer to the Combined Prospectus/Proxy Statement for a discussion of each Proposal. THE BOARD OF TRUSTEES UNANIMOUSLY RECOMMENDS A VOTE "FOR" EACH FOLLOWING PROPOSAL. Proposal 1: To approve or disapprove of the Reorganization. For_____ Against_____ Abstain_____ Proposal 2: To approve or disapprove the election of each of the Nominees. For_____ Against_____ Abstain_____ To withhold authority to vote for any individual Nominee, write that Nominee's name here:__________________________________________________________ EX-99.17(C) 5 a2044397zex-99_17c.txt EXHIBIT 99.17(C) - -------------------------------------------------------------------------------- MARCH 1, 2001 | PROSPECTUS - -------------------------------------------------------------------------------- J.P. MORGAN INSTITUTIONAL SERVICE MONEY MARKET FUNDS Prime Money Market Fund Treasury Money Market Fund Federal Money Market Fund Tax Exempt Money Market Fund -------------------------------------- Seeking to provide high current income consistent with the preservation of capital and same-day liquidity This prospectus contains essential information for anyone investing in these funds. Please read it carefully and keep it for reference. As with all mutual funds, the fact that these shares are registered with the Securities and Exchange Commission does not mean that the commission approves them or guarantees that the information in this prospectus is correct or adequate. It is a criminal offense to state or suggest otherwise. Distributed by Funds Distributor, Inc. JPMorgan CONTENTS - -------------------------------------------------------------------------------- 2 | J.P. MORGAN INSTITUTIONAL SERVICE MONEY MARKET FUNDS Each fund's goal, principal strategies, principal risks, performance and expenses J.P. Morgan Institutional Service Prime Money Market Fund ............ 2 J.P. Morgan Institutional Service Treasury Money Market Fund ......... 4 J.P. Morgan Institutional Service Federal Money Market Fund .......... 6 J.P. Morgan Institutional Service Tax Exempt Money Market Fund ....... 8 10 | MONEY MARKET MANAGEMENT APPROACH Principles and techniques common to the funds in this prospectus J.P. Morgan .......................................................... 10 J.P. Morgan Institutional Service Money Market Funds ................. 10 The spectrum of money market funds ................................... 10 Who may want to invest ............................................... 10 Money market investment process ...................................... 11 12 | YOUR INVESTMENT Investing in the J.P. Morgan Institutional Service Money Market Funds Investing through a service organization ............................. 12 Account and transaction policies ..................................... 12 Dividends and distributions .......................................... 12 Tax considerations ................................................... 13 14 | FUND DETAILS More about the funds' business operations Master/feeder structure .............................................. 14 Management and administration ........................................ 14 Financial highlights ................................................. 16 FOR MORE INFORMATION ............................................back cover J.P. MORGAN INSTITUTIONAL SERVICE PRIME MONEY MARKET FUND - -------------------------------------------------------------------------------- REGISTRANT: J.P. MORGAN INSTITUTIONAL FUNDS (J.P. MORGAN INSTITUTIONAL SERVICE PRIME MONEY MARKET FUND) [GRAPHIC] GOAL The fund's goal is to maximize current income consistent with the preservation of capital and same-day liquidity. This goal can be changed only with shareholder approval. [GRAPHIC] INVESTMENT APPROACH Principal Strategies The fund looks for investments across a broad spectrum of U.S. dollar-denominated money market securities, typically emphasizing different types of securities at different times in order to take advantage of changing yield differentials. The fund's investments may include obligations issued by the U.S. Treasury, government agencies, domestic and foreign banks and corporations, foreign governments, repurchase agreements, as well as asset-backed securities, taxable municipal obligations, and other money market instruments. Some of these investments may be illiquid or purchased on a when-issued or delayed delivery basis. The fund's yield will vary in response to changes in interest rates. How well the fund's yield compares to the yields of similar money market funds will depend on the success of the investment process described on page 11. Principal Risks As with all money market funds, the fund's investments are subject to various risks, which, while generally considered to be minimal, could cause its share price to fall below $1. For example, the issuer or guarantor of a portfolio security or the counterparty to a contract could default on its obligation. An unexpected rise in interest rates could also lead to a loss in share price if the fund is near the maximum allowable dollar weighted average maturity (currently not to exceed 90 days) at the time. To the extent that the fund invests in foreign securities, the fund could lose money because of foreign government actions, political instability, or lack of adequate and accurate information. Also, the fund may have difficulty valuing its illiquid holdings and may be unable to sell them at the time or price it desires. While these possibilities exist, the fund's investment process and management policies are designed to minimize the likelihood and impact of these risks. To date, through this process, the fund's share price has never deviated from $1. An investment in the 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. Although the fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money by investing in the fund. PORTFOLIO MANAGEMENT The fund's assets are managed by J.P. Morgan Investment Management Inc., a subsidiary of J.P. Morgan Chase & Co., J.P. Morgan Chase currently manages more than $700 billion, including more than $____ billion using similar strategies as the fund. The advisor uses a team of portfolio managers and traders to manage the fund. The portfolio management team is led by John Donohue, vice president, who has been on the team since joining J.P. Morgan in June of 1997 from Goldman Sachs & Co., where he was an Institutional Money Market Portfolio Manager; and Mark Settles, vice president, who has been on the team since November 1999 and has been at J.P. Morgan since 1994. Prior to managing this fund, Mr. Settles was a fixed income trader on J.P. Morgan's New York and London trading desks. The traders on the team are Donald Clemmenson, vice president, who has been on the team since its inception; Gunter Heiland, vice president, who has been on the team since joining J.P. Morgan in June of 1997 from Salomon Brothers, where he was a sales assistant; and Kimberly Weil, who has been on the team since its inception. - -------------------------------------------------------------------------------- Before you invest Investors considering these funds should understand that: o There is no assurance that these funds will meet their investment goals o These funds do not represent complete investment programs 2 | J.P. MORGAN INSTITUTIONAL SERVICE PRIME MONEY MARKET FUND - -------------------------------------------------------------------------------- PERFORMANCE(1) (unaudited) The bar chart and table shown below provide some indication of the risks of investing in J.P. Morgan Institutional Service Prime Money Market Fund. The bar chart indicates some of the risks by showing changes in the performance of the fund's(1) shares from year to year for each of the last ten calendar years. The table indicates some of the risks by showing the fund's average annual returns for the past one year, five years and ten years. The fund's past performance does not necessarily indicate how the fund will perform in the future. - ----------------------------- Year-by-year total return (%) Shows changes in returns by calendar year(1),(2) - -------------------------------------------------------------------------------- [The following table was depicted as a bar chart in the printed material.] J.P. Morgan Institutional Service Prime Money Market Fund(1) -------------------- 1991 6.07 1992 3.67 1993 2.83 1994 3.95 1995 5.79 1996 5.21 1997 5.41 1998 5.30 1999 4.94 2000 6.17 o J.P. Morgan Institutional Service Prime Money Market Fund(1) For the period covered by this year-by-year total return chart, the fund's highest quarterly return was 1.72% (for the quarter ended 3/31/91); and the lowest quarterly return was 0.69% (for the quarter ended 6/30/93). PERFORMANCE (unaudited) - ------------------------------- Average annual total return (%) Shows performance over time, for periods ended December 31, 2000(1) - -------------------------------------------------------------------------------- Past 1 yr. Past 5 yrs. Past 10 yrs. J.P. Morgan Institutional Service Prime Money Market Fund (after expenses) 6.17 5.40 4.93 - -------------------------------------------------------------------------------- INVESTOR EXPENSES The expenses of the fund before and after reimbursement are shown at right. The fund has no sales, redemption, exchange, or account fees, although some institutions may charge you a fee for shares you buy through them. The annual fund expenses after reimbursement are deducted from fund assets prior to performance calculations. - --------------------------------------------- Annual fund operating expenses(3) (%) (expenses that are deducted from fund assets) - --------------------------------------------- Management fees 0.11 Distribution (Rule 12b-1) fees None Service fees(4) 0.25 Other expenses 0.13 - --------------------------------------------- Total operating expenses 0.49 Fee waiver and expense reimbursement(5) 0.04 ============================================= Net expenses(5) 0.45 - --------------------------------------------- - -------------------------------------------------------------------------------- Expense example(5) - -------------------------------------------------------------------------------- The example below is intended to help you compare the cost of investing in the fund with the cost of investing in other mutual funds. The example assumes: $10,000 initial investment, 5% return each year, net expenses for the period 3/1/01 through 2/28/02 and total operating expenses thereafter, and all shares sold at the end of each time period. The example is for comparison only; the fund's actual return and your actual costs may be higher or lower. - -------------------------------------------------------------------------------- 1 yr. 3 yrs. 5 yrs. 10 yrs. Your cost($) 46 153 270 612 - -------------------------------------------------------------------------------- (1) The fund commenced operations on 10/23/97, and returns reflect the performance of the fund from 11/1/97 forward. For the period from 8/1/93 through 10/31/97, returns reflect the performance of the J.P. Morgan Prime Money Market Fund, a separate feeder fund investing in the same master portfolio. For the period from 1/1/91 through 7/31/93, returns reflect the performance of The Pierpont Money Market Fund, the predecessor to the J.P. Morgan Prime Money Market Fund. The returns of these predecessor funds reflect lower operating expenses than those of the fund. Therefore, these returns may be higher than the fund's would have been had it existed during the same period. (2) The fund's fiscal year end is 11/30. (3) The fund has a master/feeder structure as described on page 14. This table shows the fund's expenses and its share of master portfolio expenses for the past fiscal year expressed as a percentage of the fund's average net assets. (4) Service Organizations (described on page 12) may charge other fees to their customers who are the beneficial owners of shares in connection with their customers' accounts. Such fees, if any, may affect the return such customers realize with respect to their investments. (5) Reflects an agreement by Morgan Guaranty Trust Company of New York ("Morgan Guaranty"), an affiliate of J.P. Morgan, to reimburse the fund to the extent total operating expenses exceed 0.45% (excluding interest, taxes and extraordinary expenses) of the fund's average daily net assets through 2/28/02. J.P. MORGAN INSTITUTIONAL SERVICE PRIME MONEY MARKET FUND | 3 J.P. MORGAN INSTITUTIONAL SERVICE TREASURY MONEY MARKET FUND | TICKER SYMBOL: JPMXX - -------------------------------------------------------------------------------- REGISTRANT: J.P. MORGAN INSTITUTIONAL FUNDS (J.P. MORGAN INSTITUTIONAL SERVICE TREASURY MONEY MARKET FUND) [GRAPHIC] GOAL The fund's goal is to provide high current income consistent with the preservation of capital and same-day liquidity. This goal can be changed without shareholder approval. [GRAPHIC] INVESTMENT APPROACH Principal Strategies The fund purchases securities that offer the highest credit quality and provide regular income. It invests primarily in U.S. Treasury obligations and repurchase agreements collateralized by these obligations. Some of these investments may be purchased on a when-issued or delayed delivery basis. The fund may also invest in certain bank obligations when Treasury obligations or repurchase agreements are temporarily unavailable to the fund. The fund's yield will vary in response to changes in interest rates. How well the fund's yield compares to the yields of similar money market funds will depend on the success of the investment process described on page 11. The portion of the fund's income derived from direct investments in U.S. Treasury obligations may be exempt from state and local personal income taxes. Principal Risks While the fund's U.S. Treasury obligations are backed by the full faith and credit of the federal government, investors should bear in mind that any repurchase agreements the fund may hold do not have this guarantee (even though they are fully collateralized by Treasuries), and that in any case, government guarantees do not extend to shares of the fund itself. An investment in the 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. Although the fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money by investing in the fund. PORTFOLIO MANAGEMENT The fund's assets are managed by J.P. Morgan Investment Management Inc., a subsidiary of J.P. Morgan Chase & Co. J.P. Morgan Chase currently manages more than $700 billion, including more than $____ billion using similar strategies as the fund. The advisor uses a team of portfolio managers and traders to manage the fund. The portfolio management team is led by John Donohue, vice president, who has been on the team since its inception, after joining J.P. Morgan in June of 1997 from Goldman Sachs & Co., where he was an Institutional Money Market Portfolio Manager; and Mark Settles, vice president, who has been on the team since November 1999 and has been at J.P. Morgan since 1994. Prior to managing this fund, Mr. Settles was a fixed income trader on J.P. Morgan's New York and London trading desks. The traders on the team are Donald Clemmenson, vice president, Gunter Heiland, vice president, and Kimberly Weil, each of whom has been on the team since its inception. Prior to joining J.P. Morgan, Mr. Heiland was a sales assistant at Salomon Brothers. - -------------------------------------------------------------------------------- Before you invest Investors considering these funds should understand that: o There is no assurance that these funds will meet their investment goals o These funds do not represent complete investment programs 4 | J.P. MORGAN INSTITUTIONAL SERVICE TREASURY MONEY MARKET FUND - -------------------------------------------------------------------------------- PERFORMANCE (unaudited) The bar chart and table shown below provide some indication of the risks of investing in J.P. Morgan Institutional Service Treasury Money Market Fund. The bar chart indicates some of the risks by showing changes in the performance of the fund's shares from year to year for each of the last three calendar years. The table indicates some of the risks by showing the fund's average annual returns for the past one year and life of the fund. The fund's past performance does not necessarily indicate how the fund will perform in the future. - ---------------- Total return (%) Shows changes in returns by calendar year(1) - -------------------------------------------------------------------------------- [The following table was depicted as a bar chart in the printed material.] J.P. Morgan Institutional Service Treasury Money Market Fund ----------------- 1998 5.14 1999 4.64 2000 5.91 For the period covered by this total return chart, the fund's highest quarterly return was 1.53% (for the quarter ended 12/31/00); and the lowest quarterly return was 1.08% (for the quarter ended 3/31/99). PERFORMANCE (unaudited) - ------------------------------- Average annual total return (%) Shows performance over time, for periods ended December 31, 2000(2) - -------------------------------------------------------------------------------- Past 1 yr. Life of fund J.P. Morgan Institutional Service Treasury Money Market Fund (after expenses) 5.91 5.26 - -------------------------------------------------------------------------------- INVESTOR EXPENSES The expenses of the fund before and after reimbursement are shown at right. The fund has no sales, redemption, exchange, or account fees, although some institutions may charge you a fee for shares you buy through them. The annual fund expenses after reimbursement are deducted from fund assets prior to performance calculations. - --------------------------------------------- Annual fund operating expenses(3) (%) (expenses that are deducted from fund assets) - --------------------------------------------- Management fees 0.19 Distribution (Rule 12b-1) fees None Service fees(4) 0.25 Other expenses 0.16 - --------------------------------------------- Total operating expenses 0.60 Fee waiver and expense reimbursement(5) (0.15) ============================================= Net expenses(5) 0.45 - --------------------------------------------- - -------------------------------------------------------------------------------- Expense example(5) - -------------------------------------------------------------------------------- The example below is intended to help you compare the cost of investing in the fund with the cost of investing in other mutual funds. The example assumes: $10,000 initial investment, 5% return each year, net expenses for the period 3/1/01 through 2/28/02 and total operating expenses thereafter, and all shares sold at the end of each time period. The example is for comparison only; the fund's actual return and your actual costs may be higher or lower. - -------------------------------------------------------------------------------- 1 yr. 3 yrs. 5 yrs. 10 yrs. Your cost($) 46 177 320 736 - -------------------------------------------------------------------------------- (1) The fund's fiscal year end is 10/31. (2) The fund commenced operations on 7/7/97 and performance is calculated as of 7/31/97. (3) The fund has a master/feeder structure as described on page 14. This table shows the fund's expenses and its share of master portfolio expenses for the past fiscal year expressed as a percentage of the fund's average net assets. (4) Service Organizations (described on page 12) may charge other fees to their customers who are the beneficial owners of shares in connection with their customers' accounts. Such fees, if any, may affect the return such customers realize with respect to their investments. (5) Reflects an agreement by Morgan Guaranty Trust Company of New York ("Morgan Guaranty"), an affiliate of J.P. Morgan, to reimburse the fund to the extent total operating expenses exceed 0.45% (excluding interest, taxes and extraordinary expenses) of the fund's average daily net assets through 2/28/02. J.P. MORGAN INSTITUTIONAL SERVICE TREASURY MONEY MARKET FUND | 5 J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND - -------------------------------------------------------------------------------- REGISTRANT: J.P. MORGAN INSTITUTIONAL FUNDS (J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND) [GRAPHIC] GOAL The fund's goal is to provide high current income consistent with the preservation of capital and same-day liquidity. This goal can be changed only with shareholder approval. [GRAPHIC] INVESTMENT APPROACH Principal Strategies The fund purchases securities that offer very high credit quality and pay regular income that is generally free from state and local income taxes. It invests exclusively in U.S. government agency obligations such as the Federal Farm Credit Bank, the Tennessee Valley Authority, the Federal Home Loan Bank, the Student Loan Marketing Association, and in obligations of the U.S. Treasury. Some of these investments may be purchased on a when-issued or delayed delivery basis. The fund's yield will vary in response to changes in interest rates. How well the fund's yield compares to the yields of similar money market funds will depend on the success of the investment process described on page 11. Principal Risks While the fund's U.S. Treasury obligations are backed by the full faith and credit of the Government, investors should bear in mind that any agency obligations the fund may hold do not have this guarantee, and that in any case government guarantees do not extend to shares of the fund itself. Most of the fund's income is generally exempt from state and local personal income taxes and from some corporate income taxes (although not federal income taxes). Because of this beneficial tax status, the fund's yields are generally lower than those of taxable money market funds when compared on a pre-tax basis. As with all money market funds, the fund's investments are subject to various risks, which, while generally considered to be minimal, could cause its share price to fall below $1. For example, the issuer or guarantor of a portfolio security could default on its obligation. An unexpected rise in interest rates could also lead to a loss in share price if the fund is near the maximum allowable dollar weighted average maturity (currently not to exceed 90 days) at the time. However, the fund's investment process and management policies are designed to minimize the likelihood and impact of these risks. To date, through this process, the fund's share price has never deviated from $1. An investment in the 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. Although the fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money by investing in the fund. PORTFOLIO MANAGEMENT The fund's assets are managed by J.P. Morgan Investment Management Inc., a subsidiary of J.P. Morgan Chase & Co. J.P. Morgan Chase currently manages more than $700 billion, including more than $____ billion using similar strategies as the fund. The advisor uses a team of portfolio managers and traders to manage the fund. The portfolio management team is led by John Donohue, vice president, who has been on the team since joining J.P. Morgan in June of 1997 from Goldman Sachs & Co., where he was an Institutional Money Market Portfolio Manager; and Mark Settles, vice president, who has been on the team since November 1999 and has been at J.P. Morgan since 1994. Prior to managing this fund, Mr. Settles was a fixed income trader on J.P. Morgan's New York and London trading desks. The traders on the team are Donald Clemmenson, vice president, who has been on the team since its inception; Gunter Heiland, vice president, who has been on the team since joining J.P. Morgan in June of 1997 from Salomon Brothers, where he was a sales assistant; and Kimberly Weil, who has been on the team since joining J.P. Morgan in April of 1993. - -------------------------------------------------------------------------------- Before you invest Investors considering the fund should understand that: o There is no assurance that the fund will meet its investment goal. o The fund does not represent a complete investment program. 6 | J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND - -------------------------------------------------------------------------------- PERFORMANCE (unaudited) The bar chart and table shown below provide some indication of the risks of investing in J.P. Morgan Institutional Service Federal Money Market Fund. The bar chart indicates some of the risks by showing changes in the performance of the fund's(1) shares from year to year for each of the last seven calendar years. The table indicates some of the risks by showing the fund's average annual returns for the past one year, five years and life of the fund. The fund's past performance does not necessarily indicate how the fund will perform in the future. - ----------------------------- Year-by-year total return (%) Shows changes in returns by calendar year(1),(2) - -------------------------------------------------------------------------------- [The following table was depicted as a bar chart in the printed material.] J.P. Morgan Institutional Service Federal Money Market Fund(1) -------------------- 1994 3.78 1995 5.59 1996 4.99 1997 5.18 1998 5.21 1999 4.79 2000 6.01 For the period covered by this year-by-year total return chart, the fund's highest quarterly return was 1.55% (for the quarter ended 9/30/00); and the lowest quarterly return was 0.67% (for the quarter ended 3/31/94). PERFORMANCE (unaudited) - ------------------------------- Average annual total return (%) Shows performance over time, for periods ended December 31, 2000(1) - -------------------------------------------------------------------------------- Past 1 yr. Past 5 yrs. Life of fund J.P. Morgan Institutional Service Federal Money Market Fund 6.01 5.23 4.78 - -------------------------------------------------------------------------------- INVESTOR EXPENSES The expenses of the fund before and after reimbursement are shown at right. The fund has no sales, redemption, exchange, or account fees, although some institutions may charge you a fee for shares you buy through them. The annual fund expenses after reimbursement are deducted from fund assets prior to performance calculations. - --------------------------------------------- Annual fund operating expenses(3) (%) (expenses that are deducted from fund assets) - --------------------------------------------- Management fees 0.13 Distribution (Rule 12b-1) fees None Service fees(4) 0.25 Other expenses 0.22 - --------------------------------------------- Total operating expenses 0.60 Fee waiver and expense reimbursement(5) 0.15 ============================================= Net expenses(5) 0.45 - --------------------------------------------- - -------------------------------------------------------------------------------- Expense example(5) - -------------------------------------------------------------------------------- The example below is intended to help you compare the cost of investing in the fund with the cost of investing in other mutual funds. The example assumes: $10,000 initial investment, 5% return each year, net expenses for the period 3/1/01 through 2/28/02 and total operating expenses thereafter, and all shares sold at the end of each time period. The example is for comparison only; the fund's actual return and your actual costs may be higher or lower. - -------------------------------------------------------------------------------- 1 yr. 3 yrs. 5 yrs. 10 yrs. Your cost($) 46 177 320 736 - -------------------------------------------------------------------------------- (1) The fund commenced operations on 11/6/97, and returns reflect the performance of the fund from 12/1/97 forward. For the period 1/31/93 to 11/30/97, returns reflect the performance of J.P. Morgan Federal Money Market Fund, a separate feeder fund investing in the same master portfolio, with lower operating expenses than those of the fund. Therefore, these returns may be higher than the fund's would have been had it existed during the same period. (2) The fund's fiscal year end is 10/31. (3) The fund has a master/feeder structure as described on page 14. This table shows the fund's expenses and its share of master portfolio expenses for the past fiscal year expressed as a percentage of the fund's average net assets. (4) Service Organizations (described on page 12) may charge other fees to their customers who are the beneficial owners of shares in connection with their customers' accounts. Such fees, if any, may affect the return such customers realize with respect to their investment. (5) Reflects an agreement by Morgan Guaranty Trust Company of New York ("Morgan Guaranty"), an affiliate of J.P. Morgan, to reimburse the fund to the extent total operating expenses exceed 0.45% (excluding interest, taxes and extraordinary expenses) of the fund's average daily net assets through 2/28/02. J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND | 7 J.P. MORGAN INSTITUTIONAL SERVICE TAX EXEMPT MONEY MARKET FUND - -------------------------------------------------------------------------------- REGISTRANT: J.P. MORGAN INSTITUTIONAL FUNDS (J.P. MORGAN INSTITUTIONAL SERVICE TAX EXEMPT MONEY MARKET FUND) [GRAPHIC] GOAL The fund's goal is to maximize current income that is exempt from federal income tax consistent with the preservation of capital and same-day liquidity. This goal can be changed only with shareholder approval. [GRAPHIC] INVESTMENT APPROACH Principal Strategies The fund invests primarily in high quality municipal obligations whose income is exempt from federal income taxes. The fund's municipal obligations must fall into the highest short-term rating category (top two highest categories for New York State obligations) or be of equivalent quality. The fund may also invest in certain structured municipal obligations, and in certain municipal or other obligations whose income is subject to tax, including the alternative minimum tax. Although the fund is permitted to hold these other obligations or cash, it aims to be fully invested in municipal obligations. In order to maintain liquidity, the fund may buy securities with puts that allow the fund to liquidate the securities on short notice. Some of the fund's securities may be purchased on a when-issued or delayed delivery basis. The fund's yield will vary in response to changes in interest rates. How well the fund's yield compares to the yields of similar money market funds will depend on the success of the investment process described on page 11. The fund's income is generally exempt from federal income taxes. A small portion may be exempt from state or local income taxes. Principal Risks As with all money market funds, the fund's investments are subject to various risks, which, while generally considered to be minimal, could cause its share price to fall below $1. For example, the issuer or guarantor of a portfolio security or the counterparty to a contract could default on its obligation. An unexpected rise in interest rates could also lead to a loss in share price if the fund is near the maximum allowable dollar weighted average maturity (currently not to exceed 90 days) at the time. However, the fund's investment process and management policies are designed to minimize the likelihood and impact of these risks. To date, through this process, the fund's share price has never deviated from $1. An investment in the 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. Although the fund seeks to preserve the value of your investment at $1 per share, it is possible to lose money by investing in the fund. PORTFOLIO MANAGEMENT The fund's assets are managed by J.P. Morgan Investment Management Inc., a subsidiary of J.P. Morgan Chase & Co. J.P. Morgan Chase currently manages more than $700 billion, including more than $____ billion using similar strategies as the fund. The advisor uses a team of portfolio managers and traders to manage the fund. The portfolio team is composed of John Donohue, vice president, who has been on the team since joining J.P. Morgan in June of 1997 from Goldman Sachs & Co., where he was an Institutional Money Market Portfolio Manage; Abigail J. Feder, vice president, who joined J.P. Morgan in April of 2000 from Morgan Stanley Dean Witter Investment Management, where she managed short term fixed income portfolios; Benjamin Thompson, vice president, who joined J.P. Morgan in June of 1999 from Goldman Sachs, where he was a senior fixed income portfolio manager; Gunter Heiland, vice president, who has been on the team since joining J.P. Morgan in June of 1997 from Salomon Brothers, where he was a sales assistant; James Ahn, associate, who joined J.P. Morgan in June of 1996 from PricewaterhouseCoopers, LLP and has been on the team since June of 2000; and Kimberly Weil, associate, who has been on the team since its inception. - -------------------------------------------------------------------------------- Before you invest Investors considering the fund should understand that: o There is no assurance that the fund will meet its investment goal. o The fund does not represent a complete investment program. 8 | J.P. MORGAN INSTITUTIONAL SERVICE TAX EXEMPT MONEY MARKET FUND - -------------------------------------------------------------------------------- PERFORMANCE(1) (unaudited) The bar chart and table shown below provide some indication of the risks of investing in J.P. Morgan Institutional Service Tax Exempt Money Market Fund. The bar chart indicates some of the risks by showing changes in the performance of the fund's(1) shares from year to year for each of the last ten calendar years. The table indicates some of the risks by showing the fund's average annual returns for the past one year, five years and ten years. The fund's past performance does not necessarily indicate how the fund will perform in the future. - ----------------------------- Year-by-year total return (%) Shows changes in returns by calendar year(1),(2) - -------------------------------------------------------------------------------- [The following table was depicted as a bar chart in the printed material.] J.P. Morgan Institutional Service Tax Exempt Money Market Fund(1) -------------------- 1991 4.16 1992 2.71 1993 2.04 1994 2.50 1995 3.52 1996 3.12 1997 3.26 1998 3.49 1999 2.89 2000 3.71 For the period covered by this year-by-year total return chart, the fund's highest quarterly return was 1.17% (for the quarter ended 3/31/98); and the lowest quarterly return was 0.47% (for the quarter ended 3/31/94). PERFORMANCE (unaudited) - ------------------------------- Average annual total return (%) Shows performance over time, for periods ended December 31, 2000(1) - -------------------------------------------------------------------------------- Past 1 yr. Past 5 yrs. Past 10 yrs. J.P. Morgan Institutional Service Tax Exempt Money Market Fund 3.71 3.29 3.14 - -------------------------------------------------------------------------------- INVESTOR EXPENSES The expenses of the fund before and after reimbursement are shown at right. The fund has no sales, redemption, exchange, or account fees, although some institutions may charge you a fee for shares you buy through them. The annual fund expenses after reimbursement are deducted from fund assets prior to performance calculations. - --------------------------------------------- Annual fund operating expenses(3) (%) (expenses that are deducted from fund assets) - --------------------------------------------- Management fees 0.14 Distribution (Rule 12b-1) fees None Service fees(4) 0.25 Other expenses 0.31 - --------------------------------------------- Total operating expenses 0.70 Fee waiver and expense reimbursement(5) 0.25 ============================================= Net expenses(5) 0.45 - --------------------------------------------- - -------------------------------------------------------------------------------- Expense example(5) - -------------------------------------------------------------------------------- The example below is intended to help you compare the cost of investing in the fund with the cost of investing in other mutual funds. The example assumes: $10,000 initial investment, 5% return each year, net expenses for the period 3/1/01 through 2/28/02 and total operating expenses thereafter, and all shares sold at the end of each time period. The example is for comparison only; the fund's actual return and your actual costs may be higher or lower. - -------------------------------------------------------------------------------- 1 yr. 3 yrs. 5 yrs. 10 yrs. Your cost($) 46 199 365 847 - -------------------------------------------------------------------------------- (1) The fund commenced operations on 11/4/97, and returns reflect the performance of the fund from 12/1/97 forward. For the period 8/1/93 to 11/30/97, returns reflect the performance of J.P. Morgan Tax Exempt Money Market Fund, a separate feeder fund investing in the same master portfolio. For the period 1/1/91 to 7/31/93 returns reflect performance of The Pierpont Tax Exempt Money Market Fund, the predecessor of the J.P. Morgan Tax Exempt Money Market Fund. The returns of these predecessor funds reflect lower operating expenses than those of the fund. Therefore, these returns may be higher than the fund's would have been had it existed during the same period. (2) The fund's fiscal year end is 11/30. Prior to 1999, the fund's fiscal year end was 8/31. (3) The fund has a master/feeder structure as described on page 14. This table shows the fund's expenses and its share of master portfolio expenses for the past fiscal year expressed as a percentage of the fund's average net assets. (4) Service Organizations (described on page 12) may charge other fees to their customers who are the beneficial owners of shares in connection with their customers' accounts. Such fees, if any, may affect the return such customers realize with respect to their investments. (5) Reflects an agreement by Morgan Guaranty Trust Company of New York ("Morgan Guaranty"), an affiliate of J.P. Morgan, to reimburse the fund to the extent total operating expenses exceed 0.45% (excluding interest, taxes and extraordinary expenses) of the fund's average daily net assets through 2/28/02. J.P. MORGAN INSTITUTIONAL SERVICE TAX EXEMPT MONEY MARKET FUND | 9 MONEY MARKET MANAGEMENT APPROACH - -------------------------------------------------------------------------------- J.P. MORGAN Known for its commitment to proprietary research and its disciplined investment strategies, J.P. Morgan Chase is the asset management choice for many of the world's most respected corporations, financial institutions, governments, and individuals. Today, J.P. Morgan Chase employs approximately ___ research analysts, capital market researchers, portfolio managers and traders around the world and has more than $700 billion in assets under management, including assets managed by the fund's advisor, J.P. Morgan Investment Management Inc. J.P. MORGAN INSTITUTIONAL SERVICE MONEY MARKET FUNDS Each of these funds invests in high-quality short-term debt securities by investing through a master portfolio (another fund with the same goal). Each fund accrues dividends daily, pays them to shareholders monthly, and seeks to maintain a stable $1 share price. THE SPECTRUM OF MONEY MARKET FUNDS The funds described in this prospectus differ primarily in the types of securities they hold and in the tax status of the income they offer. The table below provides an overview of the main types of securities in which each fund may invest. The distinguishing features of each money market fund are described in more detail on the preceding pages. - -------------------------------------------------------------------------------- WHO MAY WANT TO INVEST The funds are designed for investors who: o want an investment that strives to preserve capital o want regular income from a high quality portfolio o want a highly liquid investment o are looking for an interim investment o are pursuing a short-term goal o are seeking income that is generally exempt from state and local income taxes (in the case of Federal Money Market Fund) or exempt from federal income tax (in the case of Tax Exempt Money Market Fund) The funds are not designed for investors who: o are investing for long-term growth o are investing for high income o require the added security of the FDIC insurance o in the case of Tax Exempt Money Market Fund, are investing through an IRA or other tax-advantaged retirement plan MONEY MARKET FUNDS AND STABILITY Money market funds are subject to a range of federal regulations designed to promote stability. For example, money market funds must maintain a weighted average maturity of no more than 90 days, and generally may not invest in any securities with a remaining maturity of more than 13 months. Keeping the weighted average maturity this short helps funds in their pursuit of a stable $1 share price. - -------------------------------------------------------------------------------- Primary investments - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Service Service Service Service Prime Treasury Federal Tax Exempt Money Market Money Market Money Market Money Market - -------------------------------------------------------------------------------- U.S. Treasuries* o o o - -------------------------------------------------------------------------------- U.S. government agency instruments o o* - -------------------------------------------------------------------------------- Domestic & foreign bank obligations o - -------------------------------------------------------------------------------- Domestic & foreign short-term corporate obligations o - -------------------------------------------------------------------------------- Foreign governments o - -------------------------------------------------------------------------------- Illiquid holdings o - -------------------------------------------------------------------------------- Repurchase agreements and reverse repurchase agreements o o - -------------------------------------------------------------------------------- Tax-exempt municipal obligations** o * Income is generally exempt from state and local income taxes ** Income is generally exempt from federal income taxes 10 | MONEY MARKET MANAGEMENT APPROACH - -------------------------------------------------------------------------------- MONEY MARKET INVESTMENT PROCESS While each fund follows its own strategy, the funds as a group share a single investment philosophy. This philosophy, developed by the funds' advisor, emphasizes investment quality through in-depth research of short-term securities and their issuers. This allows each fund to focus on providing current income without compromising share price stability. In researching short-term securities, J.P. Morgan's credit analysts enhance the data furnished by rating agencies by drawing on the insights of J.P. Morgan's fixed income trading specialists and equity analysts. Only securities highly rated by independent rating agencies as well as J.P. Morgan's proprietary ratings system are considered for investment. In managing the funds described in this prospectus, J.P. Morgan employs a three-step process that combines maturity determination, sector allocation and fundamental research for identifying portfolio securities: [GRAPHIC] J.P. Morgan uses a disciplined process to control each fund's sensitivity to interest rates Maturity determination Based on analysis of a range of factors, including current yields, economic forecasts, and anticipated fiscal and monetary policies, J.P. Morgan establishes the desired dollar weighted average maturity for each fund within the permissible 90-day range. Controlling weighted average maturity allows the funds to manage risk, since securities with shorter maturities are typically less sensitive to interest rate shifts than those with longer maturities. [GRAPHIC] The funds invest across different sectors for diversification and to take advantage of yield spreads Sector allocation Analysis of the yields available in different sectors of the short-term debt market allows J.P. Morgan to adjust each fund's sector allocation, with the goal of enhancing current income while also maintaining diversification across permissible sectors. [GRAPHIC] Each fund selects its securities as described earlier in this prospectus Security selection Based on the results of the firm's credit research and each fund's maturity determination and sector allocation, the portfolio managers and dedicated fixed-income traders make buy and sell decisions according to each fund's goal and strategy. MONEY MARKET MANAGEMENT APPROACH | 11 YOUR INVESTMENT - -------------------------------------------------------------------------------- INVESTING THROUGH A SERVICE ORGANIZATION Prospective investors may only purchase shares of each fund with the assistance of a service organization. Your service organization is paid by the fund to assist you in establishing your fund account, executing transactions, and monitoring your investment. The minimum amount for initial investments in a fund by a service organization is $10,000,000 and for additional investments $25,000, although these minimums may be less for some investors. Service organizations may provide the following services in connection with their customers' investments in the funds: o Acting, directly or through an agent, as the sole shareholder of record o Maintaining account records for customers o Processing orders to purchase, redeem or exchange shares for customers o Responding to inquiries from shareholders o Assisting customers with investment procedures ACCOUNT AND TRANSACTION POLICIES Business days and NAV calculations The funds' regular business days are the same as those of the New York Stock Exchange. The Service Prime Money Market Fund and Service Treasury Money Market Fund calculate their NAV every business day at 5:00 p.m. eastern time. The Service Federal and Service Tax Exempt Money Market Funds calculate their net asset value per share (NAV) every business day at 4:00 p.m. eastern time. Timing of orders Orders to buy or sell shares are executed at the next NAV calculated after the order has been accepted. Purchase and redemption orders for each fund must be received at the times indicated in the table below: Fund Cut-off Time Service Prime Money Market 5:00 p.m. Service Treasury Money Market 5:00 p.m. Service Federal Money Market 2:00 p.m. Service Tax Exempt Money Market 12:00 noon For the purchase to be effective and dividends to be earned on the same day, immediately available funds must be received by a fund by its close of business on that day. Service organizations will be responsible for transmitting accepted orders and payments to the funds within the time period agreed upon by them. A fund has the right to suspend redemption of shares as permitted by law and to postpone payment of proceeds for up to seven days. Timing of settlements When you buy shares, you will become the owner of record when a fund receives your payment. Redemption orders for each fund received by the respective cut-off times will be paid in immediately available funds, normally on the same day, according to instructions on file. When you sell shares that you recently purchased by check, your order will be executed at the next NAV but the proceeds will not be available until your check clears. This may take up to 15 days. Statements and reports The funds send monthly account statements as well as confirmations after each purchase or sale of shares (except reinvestments). Every six months, each fund sends out an annual or semi-annual report containing information on its holdings and a discussion of recent and anticipated market conditions and fund performance. Accounts with below-minimum balances If your account balance falls below the minimum for 30 days as a result of selling shares (and not because of performance), the fund reserves the right to request that you buy more shares or close your account. If your account balance is still below the minimum 60 days after notification, the fund reserves the right to close out your account and send the proceeds to the address of record. DIVIDENDS AND DISTRIBUTIONS Substantially all income dividends are declared daily and paid monthly. If all of an investor's shares are redeemed during the month, accrued but unpaid dividends are paid with 12 | YOUR INVESTMENT - -------------------------------------------------------------------------------- the redemption proceeds. Shares of the funds earn dividends on the business day their purchase is effective, but not on the business day their redemption is effective. Dividends and distributions are reinvested in additional fund shares. Alternatively, you may instruct your financial professional or J.P. Morgan Funds Services to have them sent to you by check, credited to a separate account, or invested in another J.P. Morgan Institutional Fund. TAX CONSIDERATIONS In general, selling shares, exchanging shares, and receiving distributions (whether reinvested or taken in cash) are all taxable events. The transactions below typically create the following tax liabilities: - -------------------------------------------------------------------------------- Transaction Tax status Income dividends from Prime Ordinary income Money Market, Treasury Money Market and Federal Money Market Funds Income dividends from Tax Generally exempt from federal Exempt Money Market Fund income taxes Short-term capital gains Ordinary income distributions Every January, each fund issues tax information on its distributions for the previous year. Any investor for whom a fund does not have a valid taxpayer identification number will be subject to backup withholding for taxes. The tax considerations described in this section do not apply to tax-deferred accounts or other non-taxable entities. Because each investor's tax circumstances are unique, please consult your tax professional about your fund investment. - -------------------------------------------------------------------------------- Shareholder Services Agent Morgan Christiana Center J.P. Morgan Funds Services - 2/OPS3 500 Stanton Christiana Road Newark, DE 19713 1-800-766-7722 Representatives are available 8:00 a.m. to 6:00 p.m. eastern time on fund business days. YOUR INVESTMENT | 13 FUND DETAILS - -------------------------------------------------------------------------------- MASTER/FEEDER STRUCTURE As noted earlier, each fund is a "feeder" fund that invests in a master portfolio. (Except where indicated, this prospectus uses the term "the fund" to mean the feeder fund and its master portfolio taken together.) Each master portfolio accepts investments from other feeder funds, and all the feeders of a given master portfolio bear the portfolio's expenses in proportion to their assets. However, each feeder can set its own transaction minimums, fund-specific expenses, and other conditions. This means that one feeder could offer access to the same master portfolio on more attractive terms, or could experience better performance, than another feeder. Information about other feeders is available by calling 1-800-766-7722. Generally, when a master portfolio seeks a vote, its feeder fund will hold a shareholder meeting and cast its vote proportionately, as instructed by its shareholders. Fund shareholders are entitled to one full or fractional vote for each dollar or fraction of a dollar invested. Each feeder fund and its master portfolio expect to maintain consistent goals, but if they do not, the feeder fund will withdraw from the master portfolio, receiving its assets either in cash or securities. Each feeder fund's trustees would then consider whether the feeder fund should hire its own investment adviser, invest in a different master portfolio, or take other action. MANAGEMENT AND ADMINISTRATION The feeder funds described in this prospectus and their corresponding master portfolios are all governed by the same trustees. The trustees are responsible for overseeing all business activities. The trustees are assisted by Pierpont Group, Inc., which they own and operate on a cost basis; costs are shared by all funds governed by these trustees. Funds Distributor Inc., as co-administrator, along with J.P. Morgan, provides fund officers. J.P. Morgan, as co-administrator, oversees each fund's other service providers. J.P. Morgan, subject to the expense reimbursements described earlier in this prospectus, receives the following fees for investment advisory and other services: Advisory services 0.20% of the first $1 billion of each master portfolio's average net assets plus 0.10% over $1 billion Administrative services Master portfolio's and fund's (fee shared with Funds pro-rata portions of 0.09% of Distributor, Inc.) the first $7 billion of average net assets in J.P. Morgan- advised portfolios, plus 0.04% over $7 billion Shareholder services 0.05% of each fund's average net assets Each fund has a service plan which allows it to pay service organizations up to 0.25% of the average net assets of the shares held in the name of the service organization. J.P. Morgan may also pay fees to certain firms and professionals for providing recordkeeping or other services in connection with investments in a fund. 14 | FUND DETAILS - -------------------------------------------------------------------------------- THIS PAGE IS LEFT BLANK INTENTIONALLY | 15 - -------------------------------------------------------------------------------- FINANCIAL HIGHLIGHTS The financial tables are intended to help you understand each fund's financial performance for the past periods indicated. Certain information reflects financial results for a single fund share. The total returns in the tables represent the rate that an investor would have earned (or lost) on an investment in a fund (assuming reinvestment of all dividends and distributions). Except where noted, this information has been audited by PricewaterhouseCoopers LLP, whose reports, along with each fund's financial statements, are included in the respective fund's annual report, which are available upon request. - -------------------------------------------------------------------------------- J.P. MORGAN INSTITUTIONAL SERVICE PRIME MONEY MARKET FUND
- --------------------------- Per-share data For fiscal periods ended 11/30/97(1) 11/30/98 11/30/99 11/30/00 - ------------------------------------------------------------------------------------------------------------------------------ Net asset value, beginning of period ($) 1.00 1.00 1.00 1.00 - ------------------------------------------------------------------------------------------------------------------------------ Income from investment operations: Net investment income ($) (0.01) 0.05 0.05 0.06 Net realized gain (loss) on investment ($) (0.0)(2) (0.00)(2) (0.00)(2) 0.00(2) ============================================================================================================================== Total from investment operations ($) (0.01) 0.05 0.05 0.06 - ------------------------------------------------------------------------------------------------------------------------------ Less distributions to shareholders from: Net investment income ($) (0.01) (0.05) (0.05) (0.06) Net realized gain ($) -- (0.00)(2) -- -- ============================================================================================================================== Total distributions to shareholders ($) (0.01) (0.05) (0.05) (0.06) - ------------------------------------------------------------------------------------------------------------------------------ Net asset value, end of period ($) 1.00 1.00 1.00 1.00 - ------------------------------------------------------------------------------------------------------------------------------ Total return (%) 0.57(3) 5.35 4.89 6.10 - ------------------------------------------------------------------------------------------------------------------------------ - --------------------------- Ratios and supplemental data - ------------------------------------------------------------------------------------------------------------------------------ Net assets, end of period ($ thousands) 384 470,863 1,490,731 2,367,857 - ------------------------------------------------------------------------------------------------------------------------------ Ratio to average net assets: Net expenses (%) 0.45(4) 0.45 0.45 0.45 ---------------------------------------------------------------------------------------------------------------------------- Net investment income (%) 5.28(4) 5.17 4.78 5.99 ---------------------------------------------------------------------------------------------------------------------------- Expenses without reimbursement (%) 35.55(4),(5) 0.56 0.51 0.49 ----------------------------------------------------------------------------------------------------------------------------
(1) The fund commenced operations on 10/23/97. (2) Less than $0.005. (3) Not annualized. (4) Annualized. (5) Not representative of ongoing reimbursement ratio since period covers less than two months. ================================================================================ J.P. MORGAN INSTITUTIONAL SERVICE TREASURY MONEY MARKET FUND
- --------------------------- Per-share data For fiscal periods ended 10/31/97(1) 10/31/98 10/31/99 10/31/00 - -------------------------------------------------------------------------------------------------------------------------------- Net asset value, beginning of period ($) 1.00 1.00 1.00 1.00 - -------------------------------------------------------------------------------------------------------------------------------- Income from investment operations: Net investment income ($) 0.02 0.05 0.05 0.06 Net realized gain (loss) on investment ($) 0.00(2) (0.00)(2) (0.00)(2) 0.00(2) ================================================================================================================================ Total from investment operations ($) 0.02 0.05 0.05 0.06 - -------------------------------------------------------------------------------------------------------------------------------- Less distributions to shareholders from: Net investment income ($) (0.02) (0.05) (0.05) (0.06) Net realized gain ($) (0.00)(2) (0.00)(2) -- -- ================================================================================================================================ Total distributions to shareholders ($) (0.02) (0.05) (0.05) (0.06) - -------------------------------------------------------------------------------------------------------------------------------- Net asset value, end of period ($) 1.00 1.00 1.00 1.00 - -------------------------------------------------------------------------------------------------------------------------------- Total return (%) 1.71(3) 5.27 4.59 5.71 - -------------------------------------------------------------------------------------------------------------------------------- - --------------------------- Ratios and supplemental data - -------------------------------------------------------------------------------------------------------------------------------- Net assets, end of period ($ thousands) 35,983 471,279 812,901 370,969 - -------------------------------------------------------------------------------------------------------------------------------- Ratio to average net assets: Net expenses (%) 0.28(4) 0.37 0.45 0.45 ------------------------------------------------------------------------------------------------------------------------------ Net investment income (%) 5.29(4) 5.11 4.52 5.47 ------------------------------------------------------------------------------------------------------------------------------ Expenses without reimbursement (%) 1.71(4) 0.66 0.59 0.60 ------------------------------------------------------------------------------------------------------------------------------
(1) The fund commenced operations on 7/7/97. (2) Less than $0.005. (3) Not annualized. (4) Annualized. 16 | FUND DETAILS - -------------------------------------------------------------------------------- ================================================================================ J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND
- --------------------------- Per-share data For fiscal periods ended 10/31/98(1) 10/31/99 10/31/00 - --------------------------------------------------------------------------------------------------- Net asset value, beginning of period ($) 1.00 1.00 1.00 - --------------------------------------------------------------------------------------------------- Income from investment operations: Net investment income ($) 0.05 0.05 0.06 Net realized gain (loss) on investment ($) (0.00)(2) (0.00)(2) 0.00 =================================================================================================== Total from investment operations ($) 0.05 0.05 0.06 - --------------------------------------------------------------------------------------------------- Less distributions to shareholders from: Net investment income ($) (0.05) (0.05) (0.06) Net realized gain -- (0.00)(2) -- =================================================================================================== Total distributions to shareholders ($) (0.05) (0.05) (0.06) - --------------------------------------------------------------------------------------------------- Net asset value, end of period ($) 1.00 1.00 1.00 - --------------------------------------------------------------------------------------------------- Total return (%) 5.24(3) 4.70 5.84 - --------------------------------------------------------------------------------------------------- - --------------------------- Ratios and supplemental data - --------------------------------------------------------------------------------------------------- Net assets, end of period ($ thousands) 29,459 9,194 247,735 - --------------------------------------------------------------------------------------------------- Ratio to average net assets: Net expenses (%) 0.45(4) 0.45 0.45 ------------------------------------------------------------------------------------------------- Net investment income (%) 5.07(4) 4.54 6.03 ------------------------------------------------------------------------------------------------- Expenses without reimbursement (%) 1.32(4) 0.78 0.60 -------------------------------------------------------------------------------------------------
(1) The fund commenced operations on 11/5/97. (2) Less than 0.0005. (3) Not annualized. (4) Annualized. ================================================================================ J.P. MORGAN INSTITUTIONAL SERVICE TAX EXEMPT MONEY MARKET FUND
For the three - --------------------------- months ended Per-share data For fiscal periods ended 8/31/98 8/31/99 11/30/99 11/30/00 - --------------------------------------------------------------------------------------------------------------------------------- Net asset value, beginning of period ($) 1.00 1.00 1.00 1.00 - --------------------------------------------------------------------------------------------------------------------------------- Income from investment operations: Net investment income ($) 0.03 0.03 0.01 0.04 Net realized gain (loss) on investment ($) (0.00)(2) 0.00(2) (0.00)(2) (0.00)(2) ================================================================================================================================= Total from investment operations ($) 0.03 0.03 0.01 0.04 - --------------------------------------------------------------------------------------------------------------------------------- Less distributions to shareholders from: Net investment income ($) (0.03) (0.03) (0.01) (0.04) ================================================================================================================================= Net asset value, end of period ($) 1.00 1.00 1.00 1.00 - --------------------------------------------------------------------------------------------------------------------------------- Total return (%) 2.80(3) 2.78 0.76(3) 3.68 - --------------------------------------------------------------------------------------------------------------------------------- - --------------------------- Ratios and supplemental data - --------------------------------------------------------------------------------------------------------------------------------- Net assets, end of period ($ thousands) 8,237 8,319 5,425 40,324 - --------------------------------------------------------------------------------------------------------------------------------- Ratio to average net assets: Net expenses (%) 0.60(4) 0.48 0.45(4) 0.45 ------------------------------------------------------------------------------------------------------------------------------- Net investment income (%) 2.95(4) 2.66 3.04(4) 3.69 ------------------------------------------------------------------------------------------------------------------------------- Expenses without reimbursement (%) 5.83(4) 1.13 1.64(4) 0.70 -------------------------------------------------------------------------------------------------------------------------------
(1) The fund commenced operations on 11/4/97. (2) Less than $0.005. (3) Not annualized. (4) Annualized. FUND DETAILS | 17 - -------------------------------------------------------------------------------- FOR MORE INFORMATION - -------------------------------------------------------------------------------- For investors who want more information on these funds, the following documents are available free upon request: Annual/Semi-annual Reports Contain financial statements, performance data, information on portfolio holdings, and a written analysis of market conditions and fund performance for a fund's most recently completed fiscal year or half-year. Statement of Additional Information (SAI) Provides a fuller technical and legal description of a fund's policies, investment restrictions, and business structure. This prospectus incorporates each fund's SAI by reference. Copies of the current versions of these documents, along with other information about the funds, may be obtained by contacting: J.P. Morgan Institutional Funds Morgan Christiana Center J.P. Morgan Funds Services - 2/OPS3 500 Stanton Christiana Road Newark, DE 19713 Telephone: 1-800-766-7722 Hearing impaired: 1-888-468-4015 Email: JPM_Mutual_Funds@JPMorgan.com Text-only versions of these documents and this prospectus are available, upon payment of a duplicating fee, from the Public Reference Room of the Securities and Exchange Commission in Washington, D.C. (1-202-942-8090) (publicinfo@sec.gov), or by writing the Public Reference Section of the SEC, Washington, DC 20549-0102 and may be viewed on-screen or downloaded from the SEC's Internet site at http://www.sec.gov. The funds' investment company and 1933 Act registration numbers are:
J.P. Morgan Institutional Service Prime Money Market Fund .......... 811-07342 and 033-54642 J.P. Morgan Institutional Service Treasury Money Market Fund ....... 811-07342 and 033-54642 J.P. Morgan Institutional Service Federal Money Market Fund ........ 811-07342 and 033-54642 J.P. Morgan Institutional Service Tax Exempt Money Market Fund ..... 811-07342 and 033-54642
J.P. MORGAN INSTITUTIONAL FUNDS AND THE MORGAN TRADITION The J.P. Morgan Institutional Funds combine a heritage of integrity and financial leadership with comprehensive, sophisticated analysis and management techniques. Drawing on J.P. Morgan's extensive experience and depth as an investment manager, the J.P. Morgan Institutional Funds offer a broad array of distinctive opportunities for mutual fund investors. JPMorgan ================================================================================ J.P. Morgan Institutional Funds Advisor Distributor J.P. Morgan Investment Management Inc. Funds Distributor, Inc. 522 Fifth Avenue 60 State Street New York, NY 10036 Boston, MA 02109 1-800-766-7722 1-800-221-7930 IMPR16 03/01 EX-99.17(E) 6 a2044397zex-99_17e.txt EXHIBIT 99.17(E) J.P. MORGAN INSTITUTIONAL FUNDS J.P. MORGAN INSTITUTIONAL SERVICE PRIME MONEY MARKET FUND J.P. MORGAN INSTITUTIONAL SERVICE TREASURY MONEY MARKET FUND J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND STATEMENT OF ADDITIONAL INFORMATION MARCH 1, 2001 THIS STATEMENT OF ADDITIONAL INFORMATION IS NOT A PROSPECTUS, BUT CONTAINS ADDITIONAL INFORMATION WHICH SHOULD BE READ IN CONJUNCTION WITH THE PROSPECTUS DATED MARCH 1, 2001 FOR THE FUND OR FUNDS LISTED ABOVE, AS SUPPLEMENTED FROM TIME TO TIME. ADDITIONALLY, THIS STATEMENT OF ADDITIONAL INFORMATION INCORPORATES BY REFERENCE THE FINANCIAL STATEMENTS INCLUDED IN THE SHAREHOLDER REPORTS RELATING TO THE FUNDS LISTED ABOVE DATED OCTOBER 31, 2000 (FOR THE TREASURY MONEY MARKET FUND AND THE FEDERAL MONEY MARKET FUND) AND NOVEMBER 30, 2000 (FOR THE PRIME MONEY MARKET FUND). THE PROSPECTUS AND THESE FINANCIAL STATEMENTS FOR THE FUNDS LISTED ABOVE, INCLUDING THE INDEPENDENT ACCOUNTANTS' REPORTS THEREON, ARE AVAILABLE, WITHOUT CHARGE, UPON REQUEST FROM FUNDS DISTRIBUTOR, INC., ATTENTION: J.P. MORGAN INSTITUTIONAL SERVICE FUNDS (800) 221-7930. Table of Contents Page ---- GENERAL........................................................................1 INVESTMENT OBJECTIVES AND POLICIES.............................................1 INVESTMENT RESTRICTIONS........................................................7 TRUSTEES, MEMBERS OF THE ADVISORY BOARD AND OFFICERS..........................11 CODES OF ETHICS...............................................................15 INVESTMENT ADVISOR............................................................16 DISTRIBUTOR...................................................................17 CO-ADMINISTRATOR..............................................................17 SERVICES AGENT................................................................18 CUSTODIAN AND TRANSFER AGENT..................................................19 SHAREHOLDER SERVICING.........................................................19 SERVICE ORGANIZATION..........................................................20 INDEPENDENT ACCOUNTANTS.......................................................21 EXPENSES......................................................................21 PURCHASE OF SHARES............................................................22 REDEMPTION OF SHARES..........................................................23 EXCHANGE OF SHARES............................................................24 DIVIDENDS AND DISTRIBUTIONS...................................................24 NET ASSET VALUE...............................................................24 PERFORMANCE DATA..............................................................25 PORTFOLIO TRANSACTIONS........................................................26 MASSACHUSETTS TRUST...........................................................27 DESCRIPTION OF SHARES.........................................................28 SPECIAL INFORMATION CONCERNING INVESTMENT STRUCTURE...........................30 TAXES.........................................................................30 ADDITIONAL INFORMATION........................................................33 FINANCIAL STATEMENTS..........................................................34 APPENDIX A...................................................................A-1 GENERAL This Statement of Additional Information relates only to the J.P. Morgan Institutional Service Prime Money Market Fund, the J.P. Morgan Institutional Service Treasury Money Market Fund and the J.P. Morgan Institutional Service Federal Money Market Fund (each, a "Fund" and collectively, the "Funds"). Each Fund is a series of shares of beneficial interest of the J.P. Morgan Institutional Funds, an open-end management investment company formed as a Massachusetts business trust (the "Trust"). In addition to the Funds, the Trust consists of other series representing separate investment funds (each a "J.P. Morgan Institutional Fund"). The other J.P. Morgan Institutional Funds are covered by separate Statements of Additional Information. This Statement of Additional Information describes the financial history, investment objective and policies, management and operation of each of the Funds and provides additional information with respect to the Funds and should be read in conjunction with the relevant Fund's current Prospectus (the "Prospectus"). Capitalized terms not otherwise defined herein have the meanings accorded to them in the Prospectus. The Funds' executive offices are located at 60 State Street, Suite 1300, Boston, Massachusetts 02109. Unlike other mutual funds which directly acquire and manage their own portfolio of securities, each Fund seeks to achieve its investment objective by investing all of its investable assets in a corresponding Master Portfolio (the "Portfolio"), a corresponding open-end management investment company having the same investment objective as the Fund. Each Fund invests in a Portfolio through a two-tier master-feeder investment fund structure. See "Special Information Concerning Investment Structure." Each Portfolio is advised by J.P. Morgan Investment Management Inc. ("JPMIM" or the "Advisor"). Investments in a Fund are not deposits or obligations of, or guaranteed or endorsed by, Morgan Guaranty Trust Company of New York, ("Morgan"), an affiliate of the Advisor, or any other bank. Shares of a Fund are not federally insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other governmental agency. An investment in a Fund is subject to risk that may cause the value of the investment to fluctuate, and when the investment is redeemed, the value may be higher or lower than the amount originally invested by the investor. INVESTMENT OBJECTIVES AND POLICIES The following discussion supplements the information regarding the investment objective of each Fund and the policies to be employed to achieve the objective by each Portfolio as set forth in the applicable Prospectus. The investment objectives of each Fund and the investment objectives of its corresponding Portfolio are identical. Accordingly, references below to a Portfolio also include the corresponding Fund; similarly, references to a Fund also include the corresponding Portfolio unless the context requires otherwise. J.P. Morgan Institutional Service Prime Money Market Fund (the "Prime Money Market Fund") is designed for investors who seek high current income consistent with the preservation of capital and same-day liquidity from a portfolio of high quality money market instruments. The Prime Money Market Fund's investment objective is to maximize current income consistent with the preservation of capital and same-day liquidity. The Prime Money Market Fund attempts to achieve this objective by investing all of its investable assets in The Prime Money Market Portfolio (the "Prime Money Market Portfolio"), a diversified open-end management investment company having the same investment objective as the Prime Money Market Fund. The Prime Money Market Portfolio seeks to achieve its investment objective by maintaining a dollar-weighted average portfolio maturity of not more than 90 days and by investing in U.S. dollar denominated securities described in this Statement of Additional Information that meet certain rating criteria, present minimal credit risk and have effective maturities of not more than thirteen months. The Portfolio's ability to achieve maximum current income is affected by its high quality standards. See "Quality and Diversification Requirements." -1- J.P. Morgan Institutional Service Treasury Money Market Fund (the "Treasury Money Market Fund") is designed for investors who seek high current income consistent with the preservation of capital and same-day liquidity from a portfolio of high quality money market instruments. The Treasury Money Market Fund's investment objective is to provide current income, consistent with the preservation of capital and same-day liquidity. The Treasury Money Market Fund attempts to accomplish this objective by investing all of its investable assets in The Treasury Money Market Portfolio (the "Treasury Money Market Portfolio"), a diversified open-end management investment company having the same investment objective as the Treasury Money Market Fund. The Treasury Money Market Portfolio attempts to achieve its investment objective by maintaining a dollar-weighted average portfolio maturity of not more than 90 days and by investing in U.S. Treasury securities and related repurchase agreement transactions as described in this Statement of Additional Information that have effective maturities of not more than thirteen months. See "Quality and Diversification Requirements." J.P. Morgan Institutional Service Federal Money Market Fund (the "Federal Money Market Fund") is designed for investors who seek high current income consistent with the preservation of capital and same-day liquidity from a portfolio of high quality money market instruments. The Federal Money Market Fund's investment objective is to provide current income, consistent with the preservation of capital and same-day liquidity. The Federal Money Market Fund attempts to accomplish this objective by investing all of its investable assets in The Federal Money Market Portfolio (the "Federal Money Market Portfolio" and together, with the Prime Money Market Portfolio and the Treasury Money Market Portfolio, the "Portfolios"), a diversified open-end management investment company having the same investment objective as the Federal Money Market Fund. The Federal Money Market Portfolio attempts to achieve its investment objective by maintaining a dollar-weighted average portfolio maturity of not more than 90 days and by investing in U.S. Treasury securities and in obligations of certain U.S. Government agencies, as described in this Statement of Additional Information that have effective maturities of not more than thirteen months. See "Quality and Diversification Requirements." Money Market Instruments A description of the various types of money market instruments that may be purchased by the Funds appears below. Also see "Quality and Diversification Requirements." U.S. Treasury Securities. Each of the Funds may invest in direct obligations of the U.S. Treasury, including Treasury bills, notes and bonds, all of which are backed as to principal and interest payments by the full faith and credit of the United States. Additional U.S. Government Obligations. Each of the Funds (other than the Treasury Money Market Fund) may invest in obligations issued or guaranteed by U.S. Government agencies or instrumentalities. These obligations may or may not be backed by the "full faith and credit" of the United States. Securities which are backed by the full faith and credit of the United States include obligations of the Government National Mortgage Association, the Farmers Home Administration, and the Export-Import Bank. In the case of securities not backed by the full faith and credit of the United States, each Fund must look principally to the federal agency issuing or guaranteeing the obligation for ultimate repayment and may not be able to assert a claim against the United States itself in the event the agency or instrumentality does not meet its commitments. Securities in which each Fund may invest that are not backed by the full faith and credit of the United States include, but are not limited to: (i) obligations of the Tennessee Valley Authority, the Federal Home Loan Mortgage Corporation, the Federal Home Loan Banks and the U.S. Postal Service, each of which has the right to borrow from the U.S. Treasury to meet its obligations; (ii) securities issued by the Federal National Mortgage Association, which are supported by the discretionary authority of the U.S. Government to purchase the agency's obligations; and (iii) obligations of the Federal Farm Credit System and the Student Loan Marketing Association, each of whose obligations may be satisfied only by the individual credits of the issuing agency. -2- Foreign Government Obligations. The Prime Money Market Fund, subject to its applicable investment policies, may also invest in short-term obligations of foreign sovereign governments or of their agencies, instrumentalities, authorities or political subdivisions. See "Foreign Investments." These securities must be denominated in the U.S. dollar. Bank Obligations. The Prime Money Market Fund, unless otherwise noted in the Prospectus or below, may invest in negotiable certificates of deposit, time deposits and bankers' acceptances of (i) banks, savings and loan associations and savings banks which have more than $2 billion in total assets and are organized under the laws of the United States or any state, (ii) foreign branches of these banks or of foreign banks of equivalent size (Euros) and (iii) U.S. branches of foreign banks of equivalent size (Yankees). The Prime Money Market Fund will not invest in obligations for which the Advisor, or any of its affiliated persons, is the ultimate obligor or accepting bank. The Prime Money Market Fund may also invest in obligations of international banking institutions designated or supported by national governments to promote economic reconstruction, development or trade between nations (e.g., the European Investment Bank, the Inter-American Development Bank, or the World Bank). Commercial Paper. The Prime Money Market Fund may invest in commercial paper, including master demand obligations. Master demand obligations are obligations that provide for a periodic adjustment in the interest rate paid and permit daily changes in the amount borrowed. Master demand obligations are governed by agreements between the issuer and Morgan acting as agent, for no additional fee. The monies loaned to the borrower come from accounts managed by Morgan or its affiliates, pursuant to arrangements with such accounts. Interest and principal payments are credited to such accounts. Morgan, an affiliate of the Advisor, has the right to increase or decrease the amount provided to the borrower under an obligation. The borrower has the right to pay without penalty all or any part of the principal amount then outstanding on an obligation together with interest to the date of payment. Since these obligations typically provide that the interest rate is tied to the Federal Reserve commercial paper composite rate, the rate on master demand obligations is subject to change. Repayment of a master demand obligation to participating accounts depends on the ability of the borrower to pay the accrued interest and principal of the obligation on demand which is continuously monitored by Morgan. Since master demand obligations typically are not rated by credit rating agencies, the Prime Money Market Fund may invest in such unrated obligations only if at the time of an investment the obligation is determined by the Advisor to have a credit quality which satisfies the Prime Money Market Fund's quality restrictions. See "Quality and Diversification Requirements." Although there is no secondary market for master demand obligations, such obligations are considered by the Prime Money Market Fund to be liquid because they are payable upon demand. The Prime Money Market Fund does not have any specific percentage limitation on investments in master demand obligations. It is possible that the issuer of a master demand obligation could be a client of Morgan to whom Morgan, in its capacity as a commercial bank, has made a loan. Asset-backed Securities. The Prime Money Market Fund may also invest in securities generally referred to as asset-backed securities, which directly or indirectly represent a participation interest in, or are secured by and payable from, a stream of payments generated by particular assets, such as motor vehicle or credit card receivables or other asset-backed securities collateralized by such assets. Asset-backed securities provide periodic payments that generally consist of both interest and principle payments. Consequently, the life of an asset-backed security varies with the prepayment experience of the underlying obligations. Payments of principal and interest may be guaranteed up to certain amounts and for a certain time period by a letter of credit issued by a financial institution unaffiliated with the entities issuing the securities. The asset-backed securities in which a Fund may invest are subject to the Fund's overall credit requirements. However, asset-backed securities, in general, are subject to certain risks. Most of these risks are related to limited interests in applicable collateral. For example, credit card debt receivables are generally unsecured and the debtors are entitled to the protection of a number of state and federal consumer credit laws, many of which give such debtors the right to set off certain amounts on credit card debt thereby reducing the balance due. Additionally, if the letter of credit is exhausted, holders of asset-backed securities may also experience delays in payments or losses if the full amounts due on underlying sales contracts are not realized. Because asset-backed securities are relatively new, the market experience in these securities is limited and the market's ability to sustain liquidity through all phases of the market cycle has not been tested. -3- Repurchase Agreements. Each of the Funds may enter into repurchase agreements with brokers, dealers or banks that meet the Advisor's credit guidelines. In a repurchase agreement, a Fund buys a security from a seller that has agreed to repurchase the same security at a mutually agreed upon date and price. The resale price normally is in excess of the purchase price, reflecting an agreed upon interest rate. This interest rate is effective for the period of time the Fund is invested in the agreement and is not related to the coupon rate on the underlying security. A repurchase agreement may also be viewed as a fully collateralized loan of money by a Fund to the seller. The period of these repurchase agreements will usually be short, from overnight to one week, and at no time will any Fund invest in repurchase agreements for more than thirteen months. The securities which are subject to repurchase agreements, however, may have maturity dates in excess of thirteen months from the effective date of the repurchase agreement. The Treasury Money Market Fund will only enter into repurchase agreements involving U.S. Treasury securities. The Federal Money Market Fund may only enter into repurchase agreements involving U.S. Treasury securities and Permitted Agency Securities. The Funds will always receive securities as collateral whose market value is, and during the entire term of the agreement remains, at least equal to 100% of the dollar amount invested by the Funds in each agreement plus accrued interest, and the Funds will make payment for such securities only upon physical delivery or upon evidence of book entry transfer to the account of the Custodian. Each Fund will be fully collateralized within the meaning of paragraph (a)(4) of Rule 2a-7 under the Investment Company Act of 1940, as amended (the "1940 Act"). If the seller defaults, a Fund might incur a loss if the value of the collateral securing the repurchase agreement declines and might incur disposition costs in connection with liquidating the collateral. In addition, if bankruptcy proceedings are commenced with respect to the seller of the security, realization upon disposal of the collateral by a Fund may be delayed or limited. The Prime Money Market Fund may make investments in other debt securities with remaining effective maturities of not more than thirteen months, including, without limitation, corporate and foreign bonds and other obligations described in the Prospectus or this Statement of Additional Information. Foreign Investments The Prime Money Market Fund may invest in certain foreign securities. All investments must be U.S. dollar-denominated. Investment in securities of foreign issuers and in obligations of foreign branches of domestic banks involves somewhat different investment risks from those affecting securities of U.S. domestic issuers. There may be limited publicly available information with respect to foreign issuers, and foreign issuers are not generally subject to uniform accounting, auditing and financial standards and requirements comparable to those applicable to domestic companies. Any foreign commercial paper must not be subject to foreign withholding tax at the time of purchase. Investors should realize that the value of the Fund's investments in foreign securities may be adversely affected by changes in political or social conditions, diplomatic relations, confiscatory taxation, expropriation, nationalization, limitation on the removal of funds or assets, or imposition of (or change in) exchange control or tax regulations in those foreign countries. In addition, changes in government administrations or economic or monetary policies in the United States or abroad could result in appreciation or depreciation of portfolio securities and could favorably or unfavorably affect the Fund's operations. Furthermore, the economies of individual foreign nations may differ from the U.S. economy, whether favorably or unfavorably, in areas such as growth of gross national product, rate of inflation, capital reinvestment, resource self-sufficiency and balance of payments position; it may also be more difficult to obtain and enforce a judgment against a foreign issuer. Any foreign investments made by the Fund must be made in compliance with U.S. and foreign currency restrictions and tax laws restricting the amounts and types of foreign investments. Additional Investments Municipal Bonds. The Prime Money Market Fund may invest in municipal bonds issued by or on behalf of states, territories and possessions of the United States and the District of Columbia and their Political subdivisions, agencies, authorities and instrumentalities. The Prime Money Market Fund may also invest in -4- municipal notes of various types, including notes issued in anticipation of receipt of taxes, the proceeds of the sale of bonds, other revenues or grant proceeds, as well as municipal commercial paper and municipal demand obligations such as variable rate demand notes and master demand obligations. These municipal bonds and notes will be taxable securities; income generated from these investments will be subject to federal, state and local taxes. When-Issued and Delayed Delivery Securities. Each of the Funds may purchase securities on a when-issued or delayed delivery basis. For example, delivery of and payment for these securities can take place a month or more after the date of the purchase commitment. The purchase price and the interest rate payable, if any, on the securities are fixed on the purchase commitment date or at the time the settlement date is fixed. The value of such securities is subject to market fluctuation and for money market instruments and other fixed income securities, no interest accrues to a Fund until settlement takes place. At the time a Fund makes the commitment to purchase securities on a when-issued or delayed delivery basis, it will record the transaction, reflect the value each day of such securities in determining its net asset value and, if applicable, calculate the maturity for the purposes of average maturity from that date. At the time of settlement a when-issued security may be valued at less than the purchase price. To facilitate such acquisitions, each Fund will maintain with the Custodian a segregated account with liquid assets, consisting of cash, U.S. Government securities or other appropriate securities, in an amount at least equal to such commitments. On delivery dates for such transactions, each Fund will meet its obligations from maturities or sales of the securities held in the segregated account and/or from cash flow. If a Fund chooses to dispose of the right to acquire a when-issued security prior to its acquisition, it could, as with the disposition of any other portfolio obligation, incur a gain or loss due to market fluctuation. Also, a Fund may be disadvantaged if the other party to the transactions defaults. Investment Company Securities. Securities of other investment companies may be acquired by each of the Funds and their corresponding Portfolios to the extent permitted under the 1940 Act or any order pursuant thereto. These limits currently require that, as determined immediately after a purchase is made, (i) not more than 5% of the value of a Fund's total assets will be invested in the securities of any one investment company, (ii) not more than 10% of the value of its total assets will be invested in the aggregate in securities of investment companies as a group, and (iii) not more than 3% of the outstanding voting stock of any one investment company will be owned by a Fund, provided however, that a Fund may invest all of its investable assets in an open-end investment company that has the same investment objective as the Fund (its corresponding Portfolio). As a shareholder of another investment company, a Fund or Portfolio would bear, along with other shareholders, its pro rata portion of the other investment company's expenses, including advisory fees. These expenses would be in addition to the advisory and other expenses that a Fund or Portfolio bears directly in connection with its own operations. Illiquid Investments, Privately Placed and Certain Unregistered Securities. The Funds, except the Treasury Money Market Fund, may invest in privately placed, restricted, Rule 144A or other unregistered securities. No Fund may acquire any illiquid holdings if, as a result thereof, more than 10% of a Funds' net assets would be in illiquid investments. Subject to this fundamental policy limitation (Prime Money Market Fund only), the Portfolios may acquire investments that are illiquid or have limited liquidity, such as private placements or investments that are not registered under the Securities Act of 1933, as amended (the "1933 Act") and cannot be offered for public sale in the United States without first being registered under the 1933 Act. An illiquid investment is any investment that cannot be disposed of within seven days in the normal course of business at approximately the amount at which it is valued by the Portfolios. The price the Portfolios pay for illiquid securities or receives upon resale may be lower than the price paid or received for similar securities with a more liquid market. Accordingly the valuation of these securities will reflect any limitations on their liquidity. The Funds may also purchase Rule 144A securities sold to institutional investors without registration under the 1933 Act. These securities may be determined to be liquid in accordance with guidelines established by the Advisor and approved by the Trustees. The Trustees will monitor the Advisor's implementation of these guidelines on a periodic basis. -5- As to illiquid investments, a Fund is subject to a risk that should the Fund decide to sell them when a ready buyer is not available at a price the Fund deems representative of their value, the value of the Fund's net assets could be adversely affected. Where an illiquid security must be registered under the 1933 Act, before it may be sold, a Fund may be obligated to pay all or part of the registration expenses, and a considerable period may elapse between the time of the decision to sell and the time the Fund may be permitted to sell a security under an effective registration statement. If, during such a period, adverse market conditions were to develop, a Fund might obtain a less favorable price than prevailed when it decided to sell. Synthetic Instruments. The Prime Money Market Fund may invest in certain synthetic instruments. Such instruments generally involve the deposit of asset-backed securities in a trust arrangement and the issuance of certificates evidencing interests in the trust. The certificates are generally sold in private placements in reliance on Rule 144A. The Advisor will review the structure of synthetic instruments to identify credit and liquidity risks and will monitor those risks. See "Illiquid Investments, Privately Placed and Certain Unregistered Securities". Quality and Diversification Requirements Each of the Funds intends to meet the diversification requirements of the 1940 Act. Current 1940 Act requirements require that with respect to 75% of the assets of each Fund are subject to the following fundamental limitations: (1) the Fund may not invest more than 5% of its total assets in the securities of any one issuer, except obligations of the U.S. Government, its agencies and instrumentalities, and (2) the Fund may not own more than 10% of the outstanding voting securities of any one issuer. As for the other 25% of the Fund's assets not subject to the limitation described above, there is no limitation on investment of these assets under the 1940 Act, so that all of such assets may be invested in securities of any one issuer. Investments not subject to the limitations described above could involve an increased risk to a Fund should an issuer, or a state or its related entities, be unable to make interest or principal payments or should the market value of such securities decline. At the time any of the Funds invest in any taxable commercial paper, master demand obligation, bank obligation or repurchase agreement, the issuer must have outstanding debt rated A or higher by Moody's or Standard & Poor's, the issuer's parent corporation, if any, must have outstanding commercial paper rated Prime-1 by Moody's or A-1 by Standard & Poor's, or if no such ratings are available, the investment must be of comparable quality in Morgan's opinion. Prime Money Market Fund. In order to achieve its investment objective and maintain a stable net asset value, the Prime Money Market Fund will (i) limit its investment in the securities (other than U.S. Government securities) of any one issuer to no more than 5% of its assets, measured at the time of purchase, except for investments held for not more than three business days; and (ii) limit investments to securities that present minimal credit risks and securities (other than U.S. Government securities) that are rated within the highest short-term rating category by at least two nationally recognized statistical rating organizations ("NRSROs") or by the only NRSRO that has rated the security. Securities which originally had a maturity of over one year are subject to more complicated, but generally similar rating requirements. A description of illustrative credit ratings is set forth in "Appendix A." The Fund may also purchase unrated securities that are of comparable quality to the rated securities described above. Additionally, if the issuer of a particular security has issued other securities of comparable priority and security and which have been rated in accordance with (ii) above, that security will be deemed to have the same rating as such other rated securities. In addition, the Board of Trustees has adopted procedures which (i) require the Board of Trustees to approve or ratify purchases by the Fund of securities (other than U.S. Government securities) that are unrated; (ii) require the Fund to maintain a dollar-weighted average portfolio maturity of not more than 90 days and to invest only in securities with a remaining maturity of not more than thirteen months; and (iii) require the Fund, in the event of certain downgradings of or defaults on portfolio holdings, to dispose of the holding, subject in certain circumstances to a finding by the Trustees that disposing of the holding would not be in the Fund's best interest. -6- Treasury Money Market Fund. In order to achieve its investment objective and maintain a stable net asset value, the Treasury Money Market Fund will limit its investments to direct obligations of the U.S. Treasury, including Treasury bills, notes and bonds, and related repurchase agreement transactions, each having a remaining maturity of not more than thirteen months at the time of purchase and will maintain a dollar-weighted average portfolio maturity of not more than 90 days. Federal Money Market Fund. In order to achieve its investment objective and maintain a stable net asset value, the Federal Money Market Fund will limit its investments to direct obligations of the U.S. Treasury, including Treasury bills, notes and bonds, and certain U.S. Government agency securities with remaining maturities of not more than thirteen months at the time of purchase and will maintain a dollar-weighted average portfolio maturity of not more than 90 days. INVESTMENT RESTRICTIONS The investment restrictions of each Fund and its corresponding Portfolio are identical, unless otherwise specified. Accordingly, references below to a Fund also include the Fund's corresponding Portfolio unless the context requires otherwise; similarly, references to a Portfolio also include its corresponding Fund unless the context requires otherwise. The investment restrictions below have been adopted by the Trust with respect to each Fund and, except as noted, by each corresponding Portfolio. Except where otherwise noted, these investment restrictions are "fundamental" policies which, under the 1940 Act, may not be changed without the vote of a majority of the outstanding voting securities of the Fund or Portfolio, as the case may be. A "majority of the outstanding voting securities" is defined in the 1940 Act as the lesser of (a) 67% or more of the voting securities present at a meeting if the holders of more than 50% of the outstanding voting securities are present or represented by proxy, or (b) more than 50% of the outstanding voting securities. The percentage limitations contained in the restrictions below apply at the time of the purchase of securities. Whenever a Fund is requested to vote on a change in the fundamental investment restrictions of its corresponding Portfolio, the Trust will hold a meeting of Fund shareholders and will cast its votes as instructed by the Fund's shareholders. The Prime Money Market Fund may not: 1. Acquire any illiquid securities, such as repurchase agreements with more than seven days to maturity or fixed time deposits with a duration of over seven calendar days, if as a result thereof, more than 10% of the Fund's net assets would be in investments which are illiquid; 2. Enter into reverse repurchase agreements exceeding in the aggregate one-third of the market value of the Fund's total assets, less liabilities other than obligations created by reverse repurchase agreements; 3. Borrow money, except from banks for extraordinary or emergency purposes and then only in amounts not to exceed 10% of the value of the Fund's total assets, taken at cost, at the time of such borrowing. Mortgage, pledge, or hypothecate any assets except in connection with any such borrowing and in amounts not to exceed 10% of the value of the Fund's net assets at the time of such borrowing. The Fund will not purchase securities while borrowings exceed 5% of the Fund's total assets; provided, however, that the Fund may increase its interest in an open-end management investment company with the same investment objective and restrictions as the Fund while such borrowings are outstanding. This borrowing provision is included to facilitate the orderly sale of portfolio securities, for example, in the event of abnormally heavy redemption requests, and is not for investment purposes and shall not apply to reverse repurchase agreements; 4. Purchase the securities or other obligations of any one issuer if, immediately after such purchase, more than 5% of the value of the Fund's total assets would be invested in securities or other obligations of any one such issuer; provided, however, that the Fund may invest all or part of its investable assets in an open-end management -7- investment company with the same investment objective and restrictions as the Fund. This limitation shall not apply to issues of the U.S. Government, its agencies or instrumentalities and to permitted investments of up to 25% of the Fund's total assets; 5. Purchase the securities or other obligations of issuers conducting their principal business activity in the same industry if, immediately after such purchase, the value of its investment in such industry would exceed 25% of the value of the Fund's total assets; provided, however, that the Fund may invest all or part of its investable assets in an open-end management investment company with the same investment objective and restrictions as the Fund. For purposes of industry concentration, there is no percentage limitation with respect to investments in U.S. Government securities, negotiable certificates of deposit, time deposits, and bankers' acceptances of U.S. branches of U.S. banks; 6. Make loans, except through purchasing or holding debt obligations, or entering into repurchase agreements, or loans of portfolio securities in accordance with the Fund's investment objective and policies (see "Investment Objectives and Policies"); 7. Purchase or sell puts, calls, straddles, spreads, or any combination thereof, real estate, commodities, or commodity contracts or interests in oil, gas, or mineral exploration or development programs. However, the Fund may purchase bonds or commercial paper issued by companies which invest in real estate or interests therein including real estate investment trusts; 8. Purchase securities on margin, make short sales of securities, or maintain a short position, provided that this restriction shall not be deemed to be applicable to the purchase or sale of when-issued securities or of securities for delivery at a future date; 9. Acquire securities of other investment companies, except as permitted by the 1940 Act; 10. Act as an underwriter of securities; or 11. Issue senior securities, except as may otherwise be permitted by the foregoing investment restrictions or under the 1940 Act or any rule, order or interpretation thereunder. The Prime Money Market Portfolio, except as noted below, has adopted substantially similar fundamental investment restrictions. Investment restrictions numbered 8 and 9 above are non-fundamental for the Portfolio. The Portfolio's fundamental borrowing restriction allows the Portfolio to borrow to the extent permitted by law, currently 33-1/3% of total assets. The Portfolio, however, has adopted a non-fundamental investment restriction limiting its borrowing ability to 10% of total assets. These differences are not expected to materially affect the management of the Portfolio. The Treasury Money Market Fund and its corresponding portfolio: 1. May not make any investment inconsistent with the Fund's classification as a diversified investment company under the Investment Company Act of 1940 2. May not purchase any security which would cause the Fund to concentrate its investments in the securities of issuers primarily engaged in any particular industry except as permitted by the SEC; 3. May not issue senior securities, except as permitted under the Investment Company Act of 1940 or any rule, order or interpretation thereunder; 4. May not borrow money, except to the extent permitted by applicable law; -8- 5. May not underwrite securities of other issuers, except to the extent that the Fund, in disposing of portfolio securities, may be deemed an underwriter within the meaning of the 1933 Act; 6. May not purchase or sell real estate, except that, to the extent permitted by applicable law, the Fund may (a) invest in securities or other instruments directly or indirectly secured by real estate, (b) invest in securities or other instruments issued by issuers that invest in real estate; 7. May not purchase or sell commodities or commodity contracts unless acquired as a result of ownership of securities or other instruments issued by persons that purchase or sell commodities or commodities contracts; but this shall not prevent the Fund from purchasing, selling and entering into financial futures contracts (including futures contracts on indices of securities, interest rates and currencies), options on financial futures contracts (including futures contracts on indices of securities, interest rates and currencies), warrants, swaps, forward contracts, foreign currency spot and forward contracts or other derivative instruments that are not related to physical commodities; and 8. May make loans to other persons, in accordance with the Fund's investment objective and policies and to the extent permitted by applicable law. The Federal Money Market Fund may not: 1. Enter into reverse repurchase agreements which together with any other borrowing exceeds in the aggregate one-third of the market value of the Fund's or the Portfolio's total assets, less liabilities other than the obligations created by reverse repurchase agreements; 2. Borrow money (not including reverse repurchase agreements), except from banks for temporary or extraordinary or emergency purposes and then only in amounts up to 10% of the value of the Fund's or the Portfolio's total assets, taken at cost at the time of such borrowing (and provided that such borrowings and reverse repurchase agreements do not exceed in the aggregate one-third of the market value of the Fund's and the Portfolio's total assets less liabilities other than the obligations represented by the bank borrowings and reverse repurchase agreements). Mortgage, pledge, or hypothecate any assets except in connection with any such borrowing and in amounts up to 10% of the value of the Fund's or the Portfolio's net assets at the time of such borrowing. The Fund or the Portfolio will not purchase securities while borrowings exceed 5% of the Fund's or the Portfolio's total assets, respectively; provided, however, that the Fund may increase its interest in an open-end management investment company with the same investment objective and restrictions as the Fund while such borrowings are outstanding. This borrowing provision is included to facilitate the orderly sale of portfolio securities, for example, in the event of abnormally heavy redemption requests, and is not for investment purposes; 3. Purchase the securities or other obligations of any one issuer if, immediately after such purchase, more than 5% of the value of the Fund's or the Portfolio's total assets would be invested in securities or other obligations of any one such issuer; provided, however, that the Fund may invest all or part of its investable assets in an open-end management investment company with the same investment objective and restrictions as the Fund. This limitation also shall not apply to issues of the U.S. Government and repurchase agreements related thereto; 4. Purchase the securities or other obligations of issuers conducting their principal business activity in the same industry if, immediately after such purchase, the value of its investment in such industry would exceed 25% of the value of the Fund's or the Portfolio's total assets; provided, however, that the Fund may invest all or part of its assets in an open-end management investment company with the same investment objective and restrictions as the Fund. For purposes of industry concentration, there is no percentage limitation with respect to investments in U.S. Government securities and repurchase agreements related thereto; -9- 5. Make loans, except through purchasing or holding debt obligations, repurchase agreements, or loans of portfolio securities in accordance with the Fund's or the Portfolio's investment objective and policies (see "Investment Objectives and Policies"); 6. Purchase or sell puts, calls, straddles, spreads, or any combination thereof, real estate, commodities, or commodity contracts or interests in oil, gas, or mineral exploration or development programs; 7. Purchase securities on margin, make short sales of securities, or maintain a short position, provided that this restriction shall not be deemed to be applicable to the purchase or sale of when-issued securities or of securities for delivery at a future date; 8. Acquire securities of other investment companies, except as permitted by the 1940 Act or in connection with a merger, consolidation, reorganization, acquisition of assets or an offer of exchange; provided, however, that nothing in this investment restriction shall prevent the Trust from investing all or part of the Fund's assets in an open-end management investment company with the same investment objective and restrictions as the Fund; 9. Act as an underwriter of securities; or 10. Issue senior securities, except as may otherwise be permitted by the foregoing investment restrictions or under the 1940 Act or any rule, order or interpretation thereunder. The Federal Money Market Portfolio, except as noted below, has adopted substantially similar fundamental investment restrictions. Investment restrictions numbered 7 and 8 above are non-fundamental for the Portfolio. The Portfolio's fundamental borrowing restriction allows the Portfolio to borrow to the extent permitted by law, currently 33-1/3% of total assets. The Portfolio, however, has adopted a non-fundamental investment restriction limiting its borrowing ability to 10% of total assets. These differences are note expected to materially affect the management of the portfolio. Non-Fundamental Investment Restrictions - Treasury Money Market Fund. The investment restrictions described below are not fundamental policies of the Fund and its Portfolio and may be changed by their Trustees. These non-fundamental investment policies require that the Fund and its corresponding Portfolio: (i) May not acquire any illiquid securities, such as repurchase agreements with more than seven days to maturity or fixed time deposits with a duration of over seven calendar days, if as a result thereof, more than 10% of the market value of the Fund's total assets would be in investments which are illiquid; (ii) May not purchase securities on margin, make short sales of securities, or maintain a short position, provided that this restriction shall not be deemed to be applicable to the purchase or sale of when-issued or delayed delivery securities (iii) May not acquire securities of other investment companies, except as permitted by the 1940 Act or any order pursuant thereto. Non-Fundamental Investment Restrictions - Prime Money Market Fund. The investment restriction described below is not a fundamental policy of the Prime Money Market Fund or its corresponding Portfolio and may be changed by their respective Trustees. This non-fundamental investment policy requires that the Prime Money Market Fund and its corresponding Portfolio may not: (i) enter into reverse repurchase agreements or borrow money, except from banks for extraordinary or emergency purposes, if such obligations exceed in the aggregate one-third of the market value of the Fund's total assets, less liabilities other than obligations created by reverse repurchase agreements and borrowings. -10- Non-Fundamental Investment Restrictions - Federal Money Market. The investment restriction described below is not a fundamental policy of the Fund or the Portfolio and may be changed by their respective Trustees. This non-fundamental investment policy requires that the Fund may not: (i) acquire any illiquid securities, such as repurchase agreements with more than seven days to maturity or fixed time deposits with a duration of over seven calendar days, if as a result thereof, more than 10% of the Fund's net assets would be in investments that are illiquid. There will be no violation of any investment restriction if that restriction is complied with at the time the relevant action is taken notwithstanding a later change in market value of an investment, in net or total assets, in the securities rating of the investment, or any other later change. For purposes of fundamental investment restrictions regarding industry concentration, the Advisor may classify issuers by industry in accordance with classifications set forth in the Directory of Companies Filing Annual Reports With The Securities and Exchange Commission or other sources. In the absence of such classification or if the Advisor determines in good faith based on its own information that the economic characteristics affecting a particular issuer make it more appropriately considered to be engaged in a different industry, the Advisor may classify accordingly. For instance, personal credit finance companies and business credit finance companies are deemed to be separate industries and wholly owned finance companies are considered to be in the industry of their parents if their activities are primarily related to financing the activities of their parents. TRUSTEES, MEMBERS OF THE ADVISORY BOARD AND OFFICERS Trustees The Trustees of the Trust, who are also the Trustees of each of the Portfolios and the other Master Portfolios, as defined below, their names, principal occupations during the past five years and dates of birth are set forth below. The mailing address is c/o Pierpont Group, Inc., 461 Fifth Avenue, New York, New York 10017. Frederick S. Addy -- Trustee; Retired; Former Executive Vice President and Chief Financial Officer, Amoco Corporation. His date of birth is January 1, 1932. William G. Burns -- Trustee; Retired; Former Vice Chairman and Chief Financial Officer, NYNEX. His date of birth is November 2, 1932. Arthur C. Eschenlauer -- Trustee; Retired; Former Senior Vice President, Morgan Guaranty Trust Company of New York. His date of birth is May 23, 1934. Matthew Healey* -- Trustee; Chairman and Chief Executive Officer; Chairman, Pierpont Group, Inc. ("Pierpont Group") since prior to 1996. His date of birth is August 23, 1937. Michael P. Mallardi -- Trustee; Retired; Prior to April 1996, Senior Vice President, Capital Cities/ABC, Inc. and President, Broadcast Group. His date of birth is March 17, 1934. A majority of the disinterested Trustees have adopted written procedures reasonably appropriate to deal with potential conflicts of interest arising from the fact that the same individuals are Trustees of the Trust, each of the Portfolios and the J.P. Morgan Institutional Funds up to and including creating a separate board of trustees. Each Trustee is currently paid an annual fee of $75,000 for serving as Trustee of the Trust, each of the Master Portfolios (as defined below), the J.P. Morgan Institutional Funds and J.P. Morgan Series Trust and is - ---------- * Mr. Healey is an "interested person" (as defined in the 1940 Act) of the Trust. -11- reimbursed for expenses incurred in connection with service as a Trustee. The Trustees may hold various other directorships unrelated to these funds. Trustee compensation expenses paid by the Trust for the calendar year ended December 31, 2000 are set forth below.
TOTAL TRUSTEE COMPENSATION ACCRUED BY THE MASTER AGGREGATE TRUSTEE COMPENSATION PORTFOLIOS(1), J.P. MORGAN FUNDS, J.P. MORGAN PAID BY THE SERIES TRUST AND THE TRUST DURING NAME OF TRUSTEE TRUST DURING 2000 2000(2) - --------------- ------------------------------ ------------------------------------------------ Frederick S. Addy, Trustee $23,538 $75,000 William G. Burns, Trustee $23,538 $75,000 Arthur C. Eschenlauer, Trustee $23,538 $75,000 Matthew Healey, Trustee(3), Chairman and Chief Executive Officer $23,538 $75,000 Michael P. Mallardi, Trustee $23,538 $75,000
(1) Includes the Portfolios and 16 other portfolios (collectively, the "Master Portfolios") for which JPMIM acts as investment adviser. (2) No investment company within the fund complex has a pension or retirement plan. Currently there are 22 investment companies (composed of 19 investment companies comprising the Master Portfolios, the J.P. Morgan Funds, the Trust and J.P. Morgan Series Trust) in the fund complex. (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 the Trust's and Portfolio's business affairs. Each of the Portfolios and the Trust has entered into a Fund Services Agreement with Pierpont Group, Inc. to assist the Trustees in exercising their overall supervisory responsibilities over the affairs of the Portfolios and the Trust. Pierpont Group, Inc. was organized in July 1989 to provide services for The Pierpont Family of Funds (now the J.P. Morgan Family of Funds), and the Trustees are the equal and sole shareholders of Pierpont Group, Inc. The Trust and the Portfolios have agreed to pay Pierpont Group, Inc. a fee that is equal to the Trust's and Portfolio's allocated share of Pierpont Group, Inc.'s reasonable costs in performing these services to the Trust, the Portfolios and certain other registered investment companies subject to similar agreements with Pierpont Group, Inc. 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. The aggregate fees paid to Pierpont Group, Inc. by each Fund and its corresponding Portfolio during the indicated fiscal periods are set forth below: Institutional Service Prime Money Market Fund -- For the fiscal years ended November 30, 1998, 1999 and 2000: $8,475, $25,409 and $26,527, respectively. The Prime Money Market Portfolio -- For the fiscal years ended November 30, 1998, 1999 and 2000: $173,032, $228,328 and $268,198, respectively. -12- Institutional Service Treasury Money Market Fund -- For the fiscal years ended October 31, 1998, 1999 and 2000: $10,469, $10,799 and $8,467, respectively. The Treasury Money Market Portfolio -- For the fiscal years ended October 31, 1998, 1999 and 2000: $15,548, $17,351 and $16,550, respectively. Institutional Service Federal Money Market Fund -- For the period November 5, 1997 (commencement of operations) through October 31, 1998 and for the fiscal years ended October 31, 1999 and 2000: $264, $564 and $1,054, respectively The Federal Money Market Portfolio -- For the fiscal years ended October 31, 1998, 1999 and 2000: $25,893, $36,961 and $46,373, respectively. Members of the 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 the Trust; 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 Trusts and the Master Portfolios. The creation of the Advisory Board and the appointment of the members thereof was designed (i) 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 each of the Trusts and the Master Portfolios, in anticipation of the current Trustees reaching the mandatory retirement age of seventy and (ii) with the intention that the Members of the Advisory Board held be proposed for election as Trustees at a shareholder meeting to be held prior to the retirement. Each member of the Advisory Board is paid an annual fee of $75,000 for serving in this capacity for the Trust, each of the Master Portfolios, the J.P. Morgan Funds and the J.P. Morgan Series Trust 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 - Former 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. 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. Officers The Trust's and Portfolios' executive officers (listed below), other than the Chief Executive Officer, are provided and compensated by Funds Distributor, Inc. ("FDI"), a wholly owned indirect subsidiary of Boston - ---------- ** Mr. Lynch may be deemed an "interest person" (as defined in the 1940 Act) of the Advisor due to his son's affiliation with an affiliate. -13- Institutional Group, Inc. The officers conduct and supervise the business operations of the Trust and the Portfolios. The Trust and the Portfolios have no employees. The officers of the Trust and the Portfolios, their principal occupations during the past five years and dates of birth are set forth below. Unless otherwise specified, each officer holds the same position with the Trust and each Portfolio. The business address of each of the officers unless otherwise noted is Funds Distributor, Inc., 60 State Street, Suite 1300, Boston, Massachusetts 02109. MATTHEW HEALEY; Chief Executive Officer; Chairman, Pierpont Group, since prior to 1996. His address is c/o Pierpont Group, Inc., 461 Fifth Avenue, New York, New York 10017. His date of birth is August 23, 1937. MARGARET W. CHAMBERS; Vice President and Secretary. Executive Vice President and General Counsel of FDI since April of 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. Her date of birth is October 12, 1959. MARIE E. CONNOLLY; Vice President and Assistant Treasurer. President, Chief Executive Officer and Director of FDI, and an officer of certain investment companies advised or administered by FDI since prior to 1996. Her date of birth is August 1, 1957. DOUGLAS C. CONROY; Vice President and Assistant Treasurer. Vice President, New Business Development of FDI and an officer of certain investment companies distributed or administered by FDI. Prior to 1999, Mr. Conroy was a Manager of Treasury Services and Administration of FDI. His date of birth is March 31, 1969. KAREN JACOPPO-WOOD; Vice President and Assistant Secretary. Vice President and Senior Counsel of FDI and an officer of certain investment companies distributed or administered by FDI. From June 1994 to January 1996, Ms. Jacoppo-Wood was a Manager of SEC Registration at Scudder, Stevens & Clark, Inc. Her date of birth is December 29, 1966. CHRISTOPHER J. KELLEY; Vice President and Assistant Secretary. Vice President and Senior Associate General Counsel of FDI and Premier Mutual and an officer of certain investment companies distributed or administered by FDI. From April 1994 to July 1996, Mr. Kelley was Assistant Counsel at Forum Financial Group. His date of birth is December 24, 1964. KATHLEEN K. MORRISEY; Vice President and Assistant Secretary. Vice President of FDI. Manager of Treasury Services Administration and an officer of certain investment companies advised or administered by Montgomery Asset Management, L.P. and Dresdner RCM Global Investors, Inc., and their respective affiliates. Her date of birth is July 5, 1972. -14- MARY A. NELSON; Vice President and Assistant Treasurer. Senior Vice President and Director of Financial Services at FDI, since August 1994, and an officer of certain investment companies distributed or administered by FDI. Her date of birth is April 22, 1964. MARY JO PACE; Assistant Treasurer; Vice President, Morgan Guaranty Trust Company of New York. Ms. Pace serves in the Funds Administration group as a Manager for the Budgeting and Expense Processing Group. Her address is 60 Wall Street, New York, New York 10260. Her date of birth is March 13, 1966. GEORGE A. RIO; President and Treasurer; Executive Vice President and Client Service Director of FDI since April 1998. From June 1995 to March 1998, Mr. Rio was Senior Vice President and Senior Key Account Manager for Putnam Mutual Funds. His date of birth is January 2, 1955. CHRISTINE ROTUNDO; Assistant Treasurer. Vice President, Morgan Guaranty Trust Company of New York. Ms. Rotundo serves as Manager of the Funds Infrastructure group and is responsible for the management of special projects. Prior to January 2000, she served as Manager of the Tax Group in the Funds Administration group and was responsible for U.S. mutual fund tax matters. Her address is 60 Wall Street, New York, New York 10260. Her date of birth is September 26, 1965. ELBA VASQUEZ; Vice President and Assistant Secretary. Vice President of FDI since February 1999. Ms. Vasquez served as National Sales Associate for FDI from May 1996. Prior to that she served in various mutual fund sales and marketing positions for U.S. Trust Company of New York. Her date of birth is December 14, 1961. As of the date of this Statement of Additional Information, the officers, Trustees and Members of the Advisory Board as a group owned less than 1% of the shares of each Fund. CODES OF ETHICS The Trust, FDI and the Advisor have adopted codes of ethics pursuant to Rule 17j-1 under the 1940 Act. Each of these codes permits personnel subject to such code to invest in securities, including securities that may be purchased or held by the Funds. Such purchases, however, are subject to preclearance and other procedures reasonably necessary to prevent access persons (as defined therein) from engaging in any unlawful conduct set forth in Rule 17j-1. INVESTMENT ADVISOR The Funds have retained JPMIM as Investment Advisor to provide investment advice and portfolio management services to the Portfolios, pursuant to an Investment Advisory Agreement dated as of October 1, 1998. Subject to the supervision of the Portfolios' Trustees, the Advisor makes the Portfolios' day-to-day investment decisions, arranges for the execution of portfolio transactions and generally manages the Portfolios' investments. The Investment Advisory Agreement provides that it will continue in effect for a period of two years after execution only if specifically approved thereafter annually in the same manner as the Distribution Agreement. See "Distributor" below. The Investment Advisory Agreement will terminate automatically if assigned and is terminable at any time without penalty by a vote of a majority of the Trustees, or by a vote of the holders of a majority of the Fund's outstanding voting securities, on 60 days' written notice to the Advisor and by the Advisor on 90 days' written notice to the Trust. See "Additional Information." The Advisor, a wholly owned subsidiary of J.P. Morgan Chase & Co. ("J.P. Morgan Chase") and a corporation organized under the laws of the State of Delaware, is a registered investment adviser under the Investment Advisers Act of 1940, as amended. The Advisor is located at 522 Fifth Avenue, New York, New York 10036. -15- J.P. Morgan Chase, a bank holding company organized under the laws of the State of Delaware, was formed from the merger of J.P. Morgan & Co. Incorporated with and into The Chase Manhattan Corporation. J.P. Morgan Chase, together with its predecessors, has been in the banking and investment advisory business for over 100 years and today, through JPMIM and its other subsidiaries, offers a wide range of banking and investment management services to governmental, institutional, corporate and individual clients. The investment advisory services the Advisor provides to the Portfolios are not exclusive under the terms of the Investment Advisory Agreement. The Advisor is free to and does render similar investment advisory services to others. The Advisor also manages employee benefit funds of corporations, labor unions and state and local governments and the accounts of other institutional investors, including investment companies. Certain of the assets of employee benefit accounts under its management are invested in commingled pension trust funds for which Morgan serves as trustee. The accounts, which are managed or advised by the Advisor, have varying investment objectives and the Advisor invests assets of such accounts in investments substantially similar to, or the same as, those which are expected to constitute the principal investments of the Portfolios. Such accounts are supervised by officers and employees of the Advisor who may also be acting in similar capacities for the Portfolios. See "Portfolio Transactions." The Portfolios are managed by employees of the Advisor who, in acting for their customers, including the Funds, do not discuss their investment decisions with any personnel of J.P. Morgan Chase or any personnel of other divisions of the Advisor or with any of its affiliated persons, with the exception of certain other investment management affiliates of J.P. Morgan Chase that execute transactions on behalf of the Portfolios. As compensation for the services rendered and related expenses such as salaries of advisory personnel borne by the Advisor under the Investment Advisory Agreements, the Portfolio corresponding to each Fund has agreed to pay the Advisor a fee, which is computed daily and may be paid monthly, equal to the annual rates of 0.20% of each Portfolio's average daily net assets up to $1 billion and 0.10% of each Portfolio's average daily net assets in excess of $1 billion. The table below sets forth for each Portfolio listed the advisory fees paid to Morgan and JPMIM, as applicable, for the fiscal periods indicated. See the Prospectus and below for applicable expense limitations. The Prime Money Market Portfolio -- For the fiscal years ended November 30, 1998, 1999 and 2000: $7,199,733, $13,226,942 and $19,059,292, respectively. The Treasury Money Market Portfolio -- For the fiscal years ended October 31, 1998, 1999 and 2000: $1,080,743, $1,715,668 and $2,000,272, respectively. The Federal Money Market Portfolio -- For the fiscal years ended October 31, 1998, 1999 and 2000: $1,736,610, $2,858,791 and $4,031,308, respectively. Morgan, an affiliate of the Advisor and a wholly owned subsidiary of J.P. Morgan Chase, is a New York trust company that conducts a general banking and trust business. Morgan is subject to regulation by the New York State Banking Department and is a member of the Federal Reserve System. Through offices in New York City and abroad, Morgan offers a wide range of services primarily to governmental, institutional, corporate and high net worth individual customers in the United States and throughout the world. Under separate agreements, Morgan also provides certain financial, fund accounting and administrative services to the Trust and the Fund and shareholder services for the Trust. Morgan is located at 60 Wall Street, New York, New York 10260. See "Services Agent" and "Shareholder Servicing" below. DISTRIBUTOR FDI serves as the Trust's exclusive Distributor and holds itself available to receive purchase orders for each of the Fund's shares. In that capacity, FDI has been granted the right, as agent of the Trust, to solicit and accept -16- orders for the purchase of each of the Fund's shares in accordance with the terms of the Distribution Agreement between the Trust and FDI. Under the terms of the Distribution Agreement between FDI and the Trust, FDI receives no compensation in its capacity as the Trust's distributor. FDI is a wholly owned indirect subsidiary of Boston Institutional Group, Inc. FDI also serves as exclusive placement agent for the Portfolio. FDI currently provides administration and distribution services for a number of other investment companies. The Distribution Agreement shall continue in effect with respect to each of the Funds for a period of two years after execution only if it is approved at least annually thereafter (i) by a vote of the holders of a majority of the Fund's outstanding shares or by its Trustees and (ii) by a vote of a majority of the Trustees of the Trust who are not "interested persons" (as defined by the 1940 Act) of the parties to the Distribution Agreement, cast in person at a meeting called for the purpose of voting on such approval (see "Trustees, Members of the Advisory Board and Officers"). The Distribution Agreement will terminate automatically if assigned by either party thereto and is terminable at any time without penalty by a vote of a majority of the Trustees of the Trust, a vote of a majority of the Trustees who are not "interested persons" of the Trust, or by a vote of the holders of a majority of the Fund's outstanding shares as defined under "Additional Information," in any case without payment of any penalty on 60 days' written notice to the other party. The principal offices of FDI are located at 60 State Street, Suite 1300, Boston, Massachusetts 02109. CO-ADMINISTRATOR Under Co-Administration Agreements with the Trust and the Portfolios dated August 1, 1996, FDI also serves as the Trust's and the Portfolios' Co-Administrator. The Co-Administration Agreements may be renewed or amended by the respective Trustees without a shareholder vote. The Co-Administration Agreements are terminable at any time without penalty by a vote of a majority of the Trustees of the Trust or the Portfolios, as applicable, on not more than 60 days' written notice nor less than 30 days' written notice to the other party. The Co-Administrator may subcontract for the performance of its obligations, provided, however, that unless the Trust or the Portfolios, as applicable, expressly agrees in writing, the Co-Administrator shall be fully responsible for the acts and omissions of any subcontractor as it would for its own acts or omissions. See "Services Agent" below. FDI (i) provides office space, equipment and clerical personnel for maintaining the organization and books and records of the Trust and the Portfolio; (ii) provides officers for the Trust and the Portfolio; (iii) prepares and files documents required for notification of state securities administrators; (iv) reviews and files marketing and sales literature; (v) files Portfolio regulatory documents and mails Portfolio communications to Trustees, Members of the Advisory Board and investors; and (vi) maintains related books and records. For its services under the Co-Administration Agreements, each Fund and Portfolio has agreed to pay FDI fees equal to its allocable share of an annual complex-wide charge of $425,000 plus FDI's out-of-pocket expenses. The amount allocable to each Fund or Portfolio is based on the ratio of its net assets to the aggregate net assets of the Trust, the Master Portfolios and certain other investment companies subject to similar agreements with FDI. The table below sets forth for each Fund listed and its corresponding Portfolio the administrative fees paid to FDI for the fiscal periods indicated. Institutional Service Prime Money Market Fund -- For the fiscal years ended November 30, 1998, 1999 and 2000: $6,691, $19,197 and $19,833, respectively. The Prime Money Market Portfolio -- For the fiscal years ended November 30, 1998, 1999 and 2000: $115,137 $147,749 and $122,295, respectively. Institutional Service Treasury Money Market Fund -- For the fiscal years ended October 31, 1998, 1999 and 2000: $7,650, $7,975 and $5,790, respectively. -17- The Treasury Money Market Portfolio -- For the fiscal years ended October 31, 1998, 1999 and 2000: $7,258, $7,923 and $6,803, respectively. Institutional Service Federal Money Market Fund -- For the period November 5, 1997 (commencement of operations) through October 31, 1998 and for the fiscal year ended October 31, 1999 and 2000: $227, $418 and $792, respectively. The Federal Money Market Portfolio -- For the fiscal years ended October 31, 1998, 1999 and 2000: $12,377, $16,872 and $19,778, respectively. SERVICES AGENT The Trust, on behalf of each Fund, and the Portfolios have entered into Administrative Services Agreements (the "Services Agreements") with Morgan pursuant to which Morgan is responsible for certain administrative and related services provided to each Fund and its corresponding Portfolio. The Services Agreements may be terminated at any time, without penalty, by the Trustees or Morgan, in each case on not more than 60 days' nor less than 30 days' written notice to the other party. Under the Services Agreements, each of the Funds and the Portfolios has agreed to pay Morgan fees equal to its allocable share of an annual complex-wide charge. This charge is calculated daily based on the aggregate net assets of the Master Portfolios and J.P. Morgan Series Trust in accordance with the following annual schedule: 0.09% of the first $7 billion of their aggregate average daily net assets and 0.04% of their aggregate average daily net assets in excess of $7 billion, less the complex-wide fees payable to FDI. The portion of this charge payable by each Fund and Portfolio is determined by the proportionate share that its net assets bear to the total net assets of the Trust, the Master Portfolios, the other investors in the Master Portfolios for which Morgan provides similar services and J.P. Morgan Series Trust. The table below sets forth for each Fund listed and its corresponding Portfolio the fees paid to Morgan as Services Agent. See the Prospectus and below for applicable expense limitations. Institutional Service Prime Money Market Fund -- For the fiscal years ended November 30, 1998, 1999 and 2000: $93,367, $342,270 and $436,377, respectively. The Prime Money Market Portfolio -- For the fiscal years ended November 30, 1998, 1999 and 2000: $1,788,454, $3,127,566 and $4,197,163, respectively. Institutional Service Treasury Money Market Fund -- For the fiscal years ended October 31, 1998, 1999 and 2000: $103,623, $138,933 and $123,631, respectively. The Treasury Money Market Portfolio -- For the fiscal years ended October 31, 1998 and 1999: $155,752, $226,699 and $251,048, respectively. Institutional Service Federal Money Market Fund -- For the period November 5, 1997 (commencement of operations) through October 31, 1998 and for the fiscal years ended October 31, 1999 and 2000: $3,189, $7,328 and $17,743, respectively. The Federal Money Market Portfolio -- For the fiscal years ended October 31, 1998, 1999 and 2000: $264,799, $480,385 and $735,431, respectively. CUSTODIAN AND TRANSFER AGENT -18- The Bank of New York ("BONY"), One Wall Street, New York, New York 10286, serves as the Trust's custodian and fund accounting agent. Pursuant to the Custodian Contract and Fund Accounting Agreement with the Trust, BONY is responsible for holding portfolio securities and cash and maintaining the books of account and records of the Fund's portfolio transactions. In the case of foreign assets held outside the United States, the custodian employs various sub-custodians in accordance with the regulations of the SEC. State Street Bank and Trust Company ("State Street"), 225 Franklin Street, Boston, Massachusetts 02110, serves as the Trust's transfer and dividend disbursing agent. As transfer agent and dividend disbursing agent, State Street is responsible for maintaining account records detailing the ownership of Fund shares and for crediting income, capital gains and other changes in share ownership to shareholder accounts. SHAREHOLDER SERVICING The Trust on behalf of each of the Funds has entered into a Shareholder Servicing Agreement with Morgan pursuant to which Morgan acts as shareholder servicing agent for its customers and for other Fund investors who are customers of a Service Organization. Under this agreement, Morgan is responsible for performing shareholder account, administrative and servicing functions, which include but are not limited to, answering inquiries regarding account status and history, the manner in which purchases and redemptions of Fund shares may be effected, and certain other matters pertaining to a Fund; assisting customers in designating and changing dividend options, account designations and addresses; providing necessary personnel and facilities to coordinate the establishment and maintenance of shareholder accounts and records with the Funds' transfer agent; transmitting purchase and redemption orders to the Funds' transfer agent and arranging for the wiring or other transfer of funds to and from customer accounts in connection with orders to purchase or redeem Fund shares; verifying purchase and redemption orders, transfers among and changes in accounts; informing the Distributor of the gross amount of purchase orders for Fund shares; monitoring the activities of the Funds' transfer agent; and providing other related services. Under the Shareholder Servicing Agreement, each Fund has agreed to pay Morgan for these services a fee at the annual rate (expressed as a percentage of the average daily net asset values of Fund shares owned by or for shareholders for whom Morgan is acting as shareholder servicing agent) of 0.05%. Morgan acts as shareholder servicing agent for all shareholders. The table below sets forth for each Fund the shareholder servicing fees paid by each Fund to Morgan for the fiscal periods indicated. See the Prospectus and below for applicable expense limitations. Institutional Service Prime Money Market Fund - For the fiscal years ended November 30, 1998, 1999 and 2000: $164,079, $671,191 and $907,994, respectively. Institutional Service Treasury Money Market Fund -- For the fiscal years ended October 31, 1998, 1999 and 2000: $180,336, $269,054 and $251,586, respectively. Institutional Service Federal Money Market Fund -- For the period November 5, 1997 (commencement of operations) through October 31, 1998 and for the fiscal year ended October 31, 1999 and 2000: $5,626, $14,368 and $37,054, respectively. SERVICE ORGANIZATION The Trust, on behalf of each Fund, has adopted a service plan (the "Plan") with respect to the shares which authorizes the Funds to compensate Service Organizations for providing certain account administration and other services to their customers who are beneficial owners of such shares. Pursuant to the Plan, the Trust, on behalf of each Fund, enters into agreements with Service Organizations which purchase shares on behalf of their customers ("Service Agreements"). Under such Service Agreements, the Service Organizations may: (a) act, directly or through an agent, as the sole shareholder of record and nominee for all customers, (b) maintain or assist in maintaining account records for each customer who beneficially owns shares, and (c) process or assist in processing -19- customer orders to purchase, redeem and exchange shares, and handle or assist in handling the transmission of funds representing the customers' purchase price or redemption proceeds. As compensation for such services, the Trust on behalf of each Fund pays each Service Organization a service fee in an amount up to 0.25% (on an annualized basis) of the average daily net assets of the shares of each Fund attributable to or held in the name of such Service Organization for its customers (0.20% where J.P. Morgan acts as a service organization). The service fees paid by the Funds to the Service Organizations during the indicated periods are set forth below: Institutional Service Prime Money Market Fund -- For the fiscal years ended November 30, 1998, 1999 and 2000: $820,398, $3,335,957 and $4,539,972, respectively. Institutional Service Treasury Money Market Fund -- For the fiscal years ended October 31, 1998, 1999 and 2000: N/A, $1,345,270 and $1,257,931, respectively. Institutional Service Federal Money Market Fund -- For the period November 5, 1997 (commencement of operations) through October 31, 1998 and for the fiscal year ended October 1999 and 2000: $71,839 and $185,262, respectively. Conflicts of interest restrictions (including the Employee Retirement Income Security Act of 1974) may apply to a Service Organization's receipt of compensation paid by the Trust in connection with the investment of fiduciary funds in shares. Service Organizations, including banks regulated by the Comptroller of the Currency, the Federal Reserve Board or the Federal Deposit Insurance Corporation, and investment advisers and other money managers subject to the jurisdiction of the Securities and Exchange Commission, the Department of Labor or state securities commissions, are urged to consult legal advisers before investing fiduciary assets in shares. In addition, under some state securities laws, banks and other financial institutions purchasing shares on behalf of their customers may be required to register as dealers. The Trustees of the Trust, including a majority of Trustees who are not interested persons of the Trust and who have no direct or indirect financial interest in the operation of such Plan or the related Service Agreements, initially voted to approve the Plan and Service Agreements at a meeting called for the purpose of voting on such Plan and Service Agreements on April 9, 1997. The Plan was approved by the initial shareholders of each Fund on June 3, 1997, remained in effect until July 10, 1998 and will continue in effect thereafter only if such continuance is specifically approved annually by a vote of the Trustees in the manner described above. The Plan may not be amended to increase materially the amount to be spent for the services described therein without approval of the shareholders of the affected Fund, and all material amendments of the Plan must also be approved by the Trustees in the manner described above. The Plan may be terminated at any time by a majority of the Trustees as described above or by vote of a majority of the outstanding shares of the affected Fund. The Service Agreements may be terminated at any time, without payment of any penalty, by vote of a majority of the disinterested Trustees as described above or by a vote of a majority of the outstanding shares of the affected Fund on not more than 60 days' written notice to any other party to the Service Agreements. The Service Agreements shall terminate automatically if assigned. So long as the Plans are in effect, the selection and nomination of those Trustees who are not interested persons shall be determined by the non-interested members of the Board of Trustees. The Trustees have determined that, in their judgment, there is a reasonable likelihood that the Plan will benefit the Funds and Fund shareholders. In the Trustees' quarterly review of the Plan and Service Agreements, they will consider their continued appropriateness and the level of compensation provided therein. INDEPENDENT ACCOUNTANTS The independent accountants of the Trust and the Portfolios are PricewaterhouseCoopers LLP, 1177 Avenue of the Americas, New York, New York 10036. PricewaterhouseCoopers LLP conducts an annual audit of the financial statements of each of the Funds and the Portfolios, assists in the preparation and/or review of each of -20- the Fund's and the Portfolio's federal and state income tax returns and consults with the Funds and the Portfolios as to matters of accounting and federal and state income taxation. EXPENSES In addition to the fees payable to Pierpont Group, Inc., JPMIM, Morgan, FDI and Service Organizations under various agreements discussed under "Trustees, Members of the Advisory Board and Officers," "Investment Advisor," "Co-Administrator", "Distributor," "Services Agent" and "Shareholder Servicing" above, the Funds and the Portfolios are responsible for usual and customary expenses associated with their respective operations. Such expenses include organization expenses, legal fees, accounting and audit expenses, insurance costs, the compensation and expenses of the Trustees and Members of the Advisory Board, costs associated with their registration fees under federal securities laws, and extraordinary expenses applicable to the Funds or the Portfolios. For the Funds, such expenses also include transfer, registrar and dividend disbursing costs, the expenses of printing and mailing reports, notices and proxy statements to Fund shareholders, and filing fees under state securities laws. For the Portfolios, such expenses also include custodian fees. For additional information regarding waivers or expense subsidies, see the Prospectus. J.P. Morgan has agreed that it will reimburse the Funds noted below until February 28, 2002 to the extent necessary to maintain the Fund's total operating expenses (excluding interest, taxes and extraordinary expenses of the Fund and its corresponding Portfolio) at the following annual rates of the Fund's average daily net assets. Institutional Service Prime Money Market Fund: 0.45% Institutional Service Treasury Money Market Fund: 0.45% Institutional Service Federal Money Market Fund: 0.45% The table below sets forth for each Fund listed the fees and other expenses J.P. Morgan reimbursed under the expense reimbursement arrangements described above or pursuant to prior expense reimbursement arrangements for the fiscal periods indicated. Institutional Service Prime Money Market Fund -- For the fiscal years ended November 30, 1998, 1999 and 2000: $375,568, $782,695 and $719,000, respectively. The Prime Money Market Porfolio - For the fiscal years ended November 30, 1998, 1999 and 2000; N/A, N/A and N/A, respectively. Institutional Service Treasury Money Market Fund -- For the fiscal years ended October 31, 1998, 1999 and 2000: $1,048,472, $758,897 and $759,228, respectively. The Treasury Money Market Portfolio -- For the fiscal years October 31, 1998, 1999 and 2000: $828,462, $403,222 and $394,705, respectively. Institutional Service Federal Money Market Fund -- For the period November 5, 1997 (commencement of operations) through October 31, 1998 and for the fiscal year ended October 31, 1999 and 2000: $97,681, $94,578 and $112,238, respectively. The Federal Money Market Portfolio -- For the fiscal years ended October 31, 1998, 1999 and 2000: $415,825, $63,027, and $0, respectively. PURCHASE OF SHARES Additional Minimum Balance Information. If your account balance falls below the minimum for 30 days as a result of selling shares (and not because of performance), each Fund reserves the right to request that you -21- buy more shares or close your account. If your account balance is still below the minimum 60 days after notification, the Fund reserves the right to close out your account and send the proceeds to the address of record. Method of Purchase. Investors may open accounts with the Fund only through the Distributor. All purchase transactions in Fund accounts are processed by Morgan as shareholder servicing agent and the Fund is authorized to accept any instructions relating to a Fund account from Morgan as shareholder servicing agent for the customer. All purchase orders must be accepted by the Distributor. Prospective investors who are not already customers of Morgan may apply to become customers of Morgan for the sole purpose of Fund transactions. There are no charges associated with becoming a Morgan customer for this purpose. Morgan reserves the right to determine the customers that it will accept, and the Trust reserves the right to determine the purchase orders that it will accept. References in the Prospectus and this Statement of Additional Information to customers of Morgan or a Service Organization include customers of their affiliates and references to transactions by customers with Morgan or a Service Organization include transactions with their affiliates. Only Fund investors who are using the services of a financial institution acting as shareholder servicing agent pursuant to an agreement with the Trust on behalf of a Fund may make transactions in shares of a Fund. Shares may be purchased for accounts held in the name of a Service Organization that provides certain account administration and other services to its customers, including acting directly or through an agent as the sole shareholder of record, maintenance or assistance in maintaining account records and processing orders to purchase, redeem and exchange shares. Shares of each Fund bear the cost of service fees at the annual rate of up to 0.25% of 1% of the average daily net assets of such shares. It is possible that an institution or its affiliate may offer shares of different funds which invest in the same Portfolio to its customers and thus receive different compensation with respect to different funds. Certain aspects of the shares may be altered, after advance notice to shareholders, if it is deemed necessary in order to satisfy certain tax regulatory requirements. Each Fund may, at its own option, accept securities in payment for shares. The securities delivered in such a transaction are valued by the method described in "Net Asset Value" as of the day the Fund receives the securities. This is a taxable transaction to the shareholder. Securities may be accepted in payment for shares only if they are, in the judgment of the Advisor, appropriate investments for the Fund's corresponding Portfolio. In addition, securities accepted in payment for shares must: (i) meet the investment objective and policies of the acquiring Fund's corresponding Portfolio; (ii) be acquired by the applicable Fund for investment and not for resale (other than for resale to the Fund's corresponding Portfolio); and (iii) be liquid securities which are not restricted as to transfer either by law or liquidity of market. Each Fund reserves the right to accept or reject at its own option any and all securities offered in payment for its shares. Prospective investors may purchase shares with the assistance of a Service Organization, and the Service Organization may charge the investor a fee for this service and other services it provides to its customers. REDEMPTION OF SHARES Investors may redeem shares as described in the Prospectus. Shareholders redeeming shares of the Funds should be aware that the Funds attempt to maintain a stable net asset value of $1.00 per share; however, there can be no assurance that they will be able to continue to do so, and in that case the net asset value of the Fund's shares might deviate from $1.00 per share. Accordingly, a redemption request might result in payment of a dollar amount which differs from the number of shares redeemed. See "Net Asset Value" below. If the Trust on behalf of a Fund and its corresponding Portfolio determine that it would be detrimental to the best interest of the remaining shareholders of a Fund to make payment wholly or partly in cash, payment of the redemption price may be made in whole or in part by a distribution in kind of securities from the Portfolio, in lieu of -22- cash, in conformity with the applicable rule of the SEC. If shares are redeemed in kind, the redeeming shareholder might incur transaction costs in converting the assets into cash. The method of valuing portfolio securities is described under "Net Asset Value," and such valuation will be made as of the same time the redemption price is determined. The Trust on behalf of the Treasury Money Market and Federal Money Market Funds and their corresponding Portfolios have elected to be governed by Rule 18f-1 under the 1940 Act pursuant to which such Funds and their corresponding Portfolios are obligated to redeem shares solely in cash up to the lesser of $250,000 or one percent of the net asset value of such Fund during any 90-day period for any one shareholder. The Trust will redeem Fund shares in kind only if it has received a redemption in kind from the corresponding Portfolio and therefore shareholders of the Fund that receive redemptions in kind will receive securities of the Portfolio. The Portfolios have advised the Trust that the Portfolios will not redeem in kind except in circumstances in which a Fund is permitted to redeem in kind. Further Redemption Information. Investors should be aware that redemptions from a Fund may not be processed if a redemption request is not submitted in proper form. To be in proper form, the Fund must have received the shareholder's taxpayer identification number and address. In addition, if a shareholder sends a check for the purchase of fund shares and shares are purchased before the check has cleared, the transmittal of redemption proceeds from the shares will occur upon clearance of the check which may take up to 15 days. The Trust, on behalf of a Fund, and the Portfolios reserve the right to suspend the right of redemption and to postpone the date of payment upon redemption as follows: (i) for up to seven days, (ii) during periods when the New York Stock Exchange is closed for other than weekends and holidays or when trading on such Exchange is restricted as determined by the SEC by rule or regulation, (iii) during periods in which an emergency, as determined by the SEC, exists that causes disposal by the Portfolio of, or evaluation of the net asset value of, its portfolio securities to be unreasonable or impracticable, or (iv) for such other periods as the SEC may permit. EXCHANGE OF SHARES An investor may exchange shares from any Fund into shares of any other J.P. Morgan Institutional or J.P. Morgan mutual fund, without charge. An exchange may be made so long as after the exchange the investor has shares, in each fund in which he or she remains an investor, with a value of at least that fund's minimum investment amount. Shareholders should read the prospectus of the fund into which they are exchanging and may only exchange between fund accounts that are registered in the same name, address and taxpayer identification number. Shares are exchanged on the basis of relative net asset value per share. Exchanges are in effect redemptions from one fund and purchases of another fund and the usual purchase and redemption procedures and requirements are applicable to exchanges. Each Fund generally intends to pay redemption proceeds in cash, however, since it reserves the right at its sole discretion to pay redemptions over $250,000 in-kind as a portfolio of representative securities rather than in cash, the Fund reserves the right to deny an exchange request in excess of that amount. See "Redemption of Shares". Shareholders subject to federal income tax who exchange shares in one fund for shares in another fund may recognize capital gain or loss for federal income tax purposes. Shares of the Fund to be acquired are purchased for settlement when the proceeds from redemption become available. The Trust reserves the right to discontinue, alter or limit the exchange privilege at any time. DIVIDENDS AND DISTRIBUTIONS Each Fund declares and pays dividends and distributions as described in the Prospectus. If a shareholder has elected to receive dividends and/or capital gain distributions in cash and the postal or other delivery service is unable to deliver checks to the shareholder's address of record, such shareholder's distribution option will automatically be converted to having all dividend and other distributions reinvested in additional shares. No interest will accrue on amounts represented by uncashed distribution or redemption checks. NET ASSET VALUE -23- Each of the Funds computes its net asset value once daily on Monday through Friday as described in the Prospectus. The net asset value will not be computed on the day the following legal holidays are observed: New Year's Day, Martin Luther King, Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day, Columbus Day, Veteran's Day, Thanksgiving Day, and Christmas Day. In the event that trading in the money markets is scheduled to end earlier than the close of the New York Stock Exchange in observance of these holidays, the Funds and their corresponding Portfolios would expect to close for purchases and redemptions an hour in advance of the end of trading in the money markets. The Funds and the Portfolios may also close for purchases and redemptions at such other times as may be determined by the Board of Trustees to the extent permitted by applicable law. On any business day when the Bond Market Association ("BMA") recommends that the securities market close early, the Funds reserve the right to cease accepting purchase and redemption orders for same business day credit at the time BMA recommends that the securities market close. On days the Funds close early, purchase and redemption orders received after the Funds close will be credited the next business day. The days on which net asset value is determined are the Funds' business days. The net asset value of each Fund is equal to the value of the Fund's investment in its corresponding Portfolio (which is equal to the Fund's pro rata share of the total investment of the Fund and of any other investors in the Portfolio less the Fund's pro rata share of the Portfolio's liabilities) less the Fund's liabilities. The following is a discussion of the procedures used by the Portfolios corresponding to each Fund in valuing their assets. The Portfolios' portfolio securities are valued by the amortized cost method. The purpose of this method of calculation is to attempt to maintain a constant net asset value per share of the Fund of $1.00. No assurances can be given that this goal can be attained. The amortized cost method of valuation values a security at its cost at the time of purchase and thereafter assumes a constant amortization to maturity of any discount or premium, regardless of the impact of fluctuating interest rates on the market value of the instrument. If a difference of more than 1/2 of 1% occurs between valuation based on the amortized cost method and valuation based on market value, the Trustees will take steps necessary to reduce such deviation, such as changing a Fund's dividend policy, shortening the average portfolio maturity, realizing gains or losses, or reducing the number of outstanding Fund shares. Any reduction of outstanding shares will be effected by having each shareholder contribute to a Fund's capital the necessary shares on a pro rata basis. Each shareholder will be deemed to have agreed to such contribution in these circumstances by his investment in the Funds. See "Taxes." PERFORMANCE DATA From time to time, the Funds may quote performance in terms of yield, actual distributions, total return or capital appreciation in reports, sales literature and advertisements published by the Trust. Current performance information for the Funds may be obtained by calling the number provided on the cover page of this Statement of Additional Information. See "Additional Information" in the Prospectus. Yield Quotations. As required by regulations of the SEC, current yield for the Funds is computed by determining the net change exclusive of capital changes in the value of a hypothetical pre-existing account having a balance of one share at the beginning of a seven-day calendar period, dividing the net change in account value of the account at the beginning of the period, and multiplying the return over the seven-day period by 365/7. For purposes of the calculation, net change in account value reflects the value of additional shares purchased with dividends from the original share and dividends declared on both the original share and any such additional shares, but does not reflect realized gains or losses or unrealized appreciation or depreciation. Effective yield for each Fund is computed by annualizing the seven-day return with all dividends reinvested in additional Fund shares. Below is set forth historical yield information for the periods indicated: Institutional Service Prime Money Market Fund (11/30/00): 7-day current yield: 6.26%; 7-day effective yield: 6.45%. -24- Institutional Service Treasury Money Market Fund (10/31/00): 7-day current yield: 6.13%; 7-day effective yield: 6.32%. Institutional Service Federal Money Market Fund (10/31/00): 7-day current yield: 6.10%; 7-day effective yield: 6.31%. Total Return Quotations. Historical performance information for periods prior to the establishment of the J.P. Morgan Institutional Service Prime Money Market and J.P. Morgan Institutional Service Federal Money Market Funds will be that of the respective related series of the J.P. Morgan Funds and will be presented in accordance with applicable SEC staff interpretations. The applicable financial information in the registration statement for the J.P. Morgan Funds (Registration Nos. 033-54632 and 811-07340) is incorporated herein by reference. The historical performance information shown below for the Institutional Service Prime Money Market and Institutional Service Federal Money Market Funds may reflect operating expenses which were lower than those of the Funds. These returns may be higher than would have occurred if an investment had been made during the periods indicated in the J.P. Morgan Institutional Service Prime Money Market or J.P. Morgan Institutional Service Federal Money Market Funds. Below is set forth historical return information for each Fund or its related series of the J.P. Morgan Funds for the periods indicated: Institutional Service Prime Money Market Fund (11/30/00): Average annual total return, 1 year: 6.10%; average annual total return, 5 years: 5.40%; average annual total return, 10 years: 4.94%; aggregate total return, 1 year: 6.10%; aggregate total return, 5 years: 30.08%; aggregate total return, 10 years: 61.95%. Institutional Service Treasury Money Market Fund (10/31/00): Average annual total return, 1 year: 5.71%; average annual total return, 5 years: N/A; average annual total return, commencement of operations (July 7, 1997) to period end: 5.09%; aggregate total return, 1 year: 5.71%; aggregate total return, 5 years: N/A; aggregate total return, commencement of operations (July 7, 1997) to period end: 17.89 %. Institutional Service Federal Money Market Fund (10/31/00): Average annual total return, 1 year: 5.84%; average annual total return, 5 years: 5.21%; average annual total return, 10 years: N/A; average annual total return, commencement of operations (November 5, 1997) to period end: 5.28%; aggregate total return, 1 year: 5.84%; aggregate total return, 5 years: 28.90%; aggregate total return, 10 years: N/A; aggregate total return, commencement of operations (November 5, 1997) to period end: 16.62%. Aggregate total returns, reflecting the cumulative percentage change over a measuring period, may also be calculated. General. General. A Fund's performance will vary from time to time depending upon market conditions, the composition of its corresponding Portfolio, and its operating expenses. Consequently, any given performance quotation should not be considered representative of a Fund's performance for any specified period in the future. In addition, because performance will fluctuate, it may not provide a basis for comparing an investment in a Fund with certain bank deposits or other investments that pay a fixed yield or return for a stated period of time. Comparative performance information may be used from time to time in advertising the Funds' shares, including appropriate market indices or data from Lipper Analytical Services, Inc., Micropal, Inc., Ibbotson Associates, Morningstar Inc., the Dow Jones Industrial Average and other industry publications. From time to time, the Funds may, in addition to any other permissible information, include the following types of information in advertisements, supplemental sales literature and reports to shareholders: (1) discussions of general economic or financial principles (such as the effects of compounding and the benefits of dollar-cost averaging); (2) discussions of general economic trends; (3) presentations of statistical data to supplement such -25- discussions; (4) descriptions of past or anticipated portfolio holdings for one or more of the Funds; (5) descriptions of investment strategies for one or more of the Funds; (6) descriptions or comparisons of various savings and investment products (including, but not limited to, qualified retirement plans and individual stocks and bonds), which may or may not include the Funds; (7) comparisons of investment products (including the Funds) with relevant markets or industry indices or other appropriate benchmarks; (8) discussions of Fund rankings or ratings by recognized rating organizations; and (9) discussions of various statistical methods quantifying the Fund's volatility relative to its benchmark or to past performance, including risk adjusted measures. The Funds may also include calculations, such as hypothetical compounding examples, which describe hypothetical investment results in such communications. Such performance examples will be based on an express set of assumptions and are not indicative of the performance of any of the Funds. PORTFOLIO TRANSACTIONS The Advisor places orders for all Portfolios 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 all the Portfolios. See "Investment Objectives and Policies." Fixed income and debt securities 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 Portfolios will be undertaken principally to accomplish a Portfolio's objective in relation to expected movements in the general level of interest rates. The Portfolios may engage in short-term trading consistent with their objectives. See "Investment Objectives and Policies -- Portfolio Turnover." In connection with portfolio transactions for the Portfolios, the Advisor intends to seek best execution on a competitive basis for both purchases and sales of securities. The Portfolios have a policy of investing only in securities with maturities of not more than thirteen months, which will result in high portfolio turnovers. Since brokerage commissions are not normally paid on investments which the Portfolios make, turnover resulting from such investments should not adversely affect the net asset value or net income of the Portfolios. Subject to the overriding objective of obtaining best execution of orders, the Advisor may allocate a portion of a Portfolio's brokerage transactions to affiliates of the Advisor. Under the 1940 Act, persons affiliated with the Portfolio and persons who are affiliated with such persons are prohibited from dealing with the Portfolio as principal in the purchase and sale of securities unless a permissive order allowing such transactions is obtained from the SEC. However, affiliated persons of the Portfolio 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 Portfolio may not purchase securities during the existence of any underwriting syndicate for such securities of which Morgan or an affiliate is a member or in a private placement in which Morgan or an affiliate serves as placement agent except pursuant to procedures adopted by the Board of Trustees of the Portfolio that either comply with rules adopted by the SEC or with interpretations of the SEC's staff. On those occasions when the Advisor deems the purchase or sale of a security to be in the best interests of a Portfolio as well as other customers including other Portfolios, the Advisor to the extent permitted by applicable laws and regulations, may, but is not obligated to, aggregate the securities to be sold or purchased for a Portfolio with those to be sold or purchased for other customers 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 -26- incurred in the transaction will be made by the Advisor in the manner it considers to be most equitable and consistent with its fiduciary obligations to a Portfolio. In some instances, this procedure might adversely affect a Portfolio. MASSACHUSETTS TRUST The Trust is a trust fund of the type commonly known as a "Massachusetts business trust" of which each Fund is a separate and distinct series. A copy of the Declaration of Trust for the Trust is on file in the office of the Secretary of The Commonwealth of Massachusetts. The Declaration of Trust and the By-Laws of the Trust are designed to make the Trust similar in most respects to a Massachusetts business corporation. The principal distinction between the two forms concerns shareholder liability described below. Effective January 9, 1997, the name of The Treasury Money Market Portfolio was changed to The Federal Money Market Portfolio. Effective May 12, 1997, the name of The Money Market Portfolio was changed to The Prime Money Market Portfolio. Effective January 1, 1998, the name of the Trust was changed from "The JPM Institutional Funds" to "J.P. Morgan Institutional Funds," and each Fund's name changed accordingly. Under Massachusetts law, shareholders of such a trust may, under certain circumstances, be held personally liable as partners for the obligations of the trust which is not the case for a corporation. However, the Trust's Declaration of Trust provides that the shareholders shall not be subject to any personal liability for the acts or obligations of any Fund and that every written agreement, obligation, instrument or undertaking made on behalf of any Fund shall contain a provision to the effect that the shareholders are not personally liable thereunder. No personal liability will attach to the shareholders under any undertaking containing such provision when adequate notice of such provision is given, except possibly in a few jurisdictions. With respect to all types of claims in the latter jurisdictions, (i) tort claims, (ii) contract claims where the provision referred to is omitted from the undertaking, (iii) claims for taxes, and (iv) certain statutory liabilities in other jurisdictions, a shareholder may be held personally liable to the extent that claims are not satisfied by a Fund. However, upon payment of such liability, the shareholder will be entitled to reimbursement from the general assets of a Fund. The Trustees intend to conduct the operations of the Trust in such a way so as to avoid, as far as possible, ultimate liability of the shareholders for liabilities of the Funds. The Trust's Declaration of Trust further provides that the name of the Trust refers to the Trustees collectively as Trustees, not as individuals or personally, that no Trustee, Member of the Advisory Board, officer, employee or agent of a Fund is liable to a Fund or to a shareholder, and that no Trustee, Member of the Advisory Board, officer, employee, or agent is liable to any third persons in connection with the affairs of a Fund, except as such liability may arise from his or its own bad faith, willful misfeasance, gross negligence or reckless disregard of his or its duties to such third persons. It also provides that all third persons shall look solely to Fund property for satisfaction of claims arising in connection with the affairs of a Fund. With the exceptions stated, the Trust's Declaration of Trust provides that a Trustee, Member of the Advisory Board, officer, employee, or agent is entitled to be indemnified against all liability in connection with the affairs of a Fund. The Trust shall continue without limitation of time subject to the provisions in the Declaration of Trust concerning termination by action of the shareholders or by action of the Trustees upon notice to the shareholders. DESCRIPTION OF SHARES The Trust is an open-end management investment company organized as a Massachusetts business trust in which each Fund represents a separate series of shares of beneficial interest. See "Massachusetts Trust." The Declaration of Trust permits the Trustees to issue an unlimited number of full and fractional shares ($0.001 par value) of one or more series and classes within any series and to divide or combine the shares (of any series, if applicable) without changing the proportionate beneficial interest of each shareholder in a Fund (or in the assets of other series, if applicable). Each share represents an equal proportional interest in a Fund with each other share. Upon -27- liquidation of a Fund, holders are entitled to share pro rata in the net assets of a Fund available for distribution to such shareholders. See "Massachusetts Trust." Shares of a Fund have no preemptive or conversion rights and are fully paid and nonassessable. The rights of redemption and exchange are described in the Prospectus and elsewhere in this Statement of Additional Information. The shareholders of the Trust are entitled to one vote for each dollar of net asset value (or a proportionate fractional vote in respect of a fractional dollar amount), on matters on which shares of the Fund shall be entitled to vote. Subject to the 1940 Act, the Trustees themselves have the power to alter the number and the terms of office of the Trustees, to lengthen their own terms, or to make their terms of unlimited duration subject to certain removal procedures, and appoint their own successors, provided, however, that immediately after such appointment the requisite majority of the Trustees have been elected by the shareholders of the Trust. The voting rights of shareholders are not cumulative so that holders of more than 50% of the shares voting can, if they choose, elect all Trustees being selected while the shareholders of the remaining shares would be unable to elect any Trustees. It is the intention of the Trust not to hold meetings of shareholders annually. The Trustees may call meetings of shareholders for action by shareholder vote as may be required by either the 1940 Act or the Trust's Declaration of Trust. Shareholders of the Trust have the right, upon the declaration in writing or vote of more than two-thirds of its outstanding shares, to remove a Trustee. The Trustees will call a meeting of shareholders to vote on removal of a Trustee upon the written request of the record holders of 10% of the Trust's shares. In addition, whenever ten or more shareholders of record who have been such for at least six months preceding the date of application, and who hold in the aggregate either shares having a net asset value of at least $25,000 or at least 1% of the Trust's outstanding shares, whichever is less, shall apply to the Trustees in writing, stating that they wish to communicate with other shareholders with a view to obtaining signatures to request a meeting for the purpose of voting upon the question of removal of any Trustee or Trustees and accompanied by a form of communication and request which they wish to transmit, the Trustees shall within five business days after receipt of such application either: (1) afford to such applicants access to a list of the names and addresses of all shareholders as recorded on the books of the Trust; or (2) inform such applicants as to the approximate number of shareholders of record, and the approximate cost of mailing to them the proposed communication and form of request. If the Trustees elect to follow the latter course, the Trustees, upon the written request of such applicants, accompanied by a tender of the material to be mailed and of the reasonable expenses of mailing, shall, with reasonable promptness, mail such material to all shareholders of record at their addresses as recorded on the books, unless within five business days after such tender the Trustees shall mail to such applicants and file with the SEC, together with a copy of the material to be mailed, a written statement signed by at least a majority of the Trustees to the effect that in their opinion either such material contains untrue statements of fact or omits to state facts necessary to make the statements contained therein not misleading, or would be in violation of applicable law, and specifying the basis of such opinion. After opportunity for hearing upon the objections specified in the written statements filed, the SEC may, and if demanded by the Trustees or by such applicants shall, enter an order either sustaining one or more of such objections or refusing to sustain any of them. If the SEC shall enter an order refusing to sustain any of such objections, or if, after the entry of an order sustaining one or more of such objections, the SEC shall find, after notice and opportunity for hearing, that all objections so sustained have been met, and shall enter an order so declaring, the Trustees shall mail copies of such material to all shareholders with reasonable promptness after the entry of such order and the renewal of such tender. The Trustees have authorized the issuance and sale to the public of shares of 34 series of the Trust. The Trustees have no current intention to create any classes within the initial series or any subsequent series. The Trustees may, however, authorize the issuance of shares of additional series and the creation of classes of shares within any series with such preferences, privileges, limitations and voting and dividend rights as the Trustees may determine. The proceeds from the issuance of any additional series would be invested in separate, independently managed portfolios with distinct investment objectives, policies and restrictions, and share purchase, redemption and net asset valuation procedures. Any additional classes would be used to distinguish among the rights of different categories of shareholders, as might be required by future regulations or other unforeseen circumstances. All -28- consideration received by the Trust for shares of any additional series or class, and all assets in which such consideration is invested, would belong to that series or class, subject only to the rights of creditors of the Trust and would be subject to the liabilities related thereto. Shareholders of any additional series or class will approve the adoption of any management contract or distribution plan relating to such series or class and of any changes in the investment policies related thereto, to the extent required by the 1940 Act. For information relating to mandatory redemption of Fund shares or their redemption at the option of the Trust under certain circumstances, see the Prospectus. As of January 31, 2001, no one owned of record or was known by the fund to own beneficially more than 5% of the outstanding shares of the Funds. SPECIAL INFORMATION CONCERNING INVESTMENT STRUCTURE Unlike other mutual funds which directly acquire and manage their own portfolio of securities, each Fund is an open-end management investment company which seeks to achieve its investment objective by investing all of its investable assets in a corresponding Master Portfolio, a separate registered investment company with the same investment objective and policies as the Fund. Generally, when a Master Portfolio seeks a vote to change a fundamental investment restriction, its feeder fund(s) will hold a shareholder meeting and cast its vote proportionately, as instructed by its shareholders. Fund shareholders are entitled to one vote for each dollar of net asset value (or a proportionate fractional vote in respect of a fractional dollar amount), on matters on which shares of the Fund shall be entitled to vote. In addition to selling a beneficial interest to a Fund, a Portfolio may sell beneficial interests to other mutual funds or institutional investors. Such investors will invest in the Portfolio on the same terms and conditions and will bear a proportionate share of the Portfolio's expenses. However, the other investors investing in the Portfolio may sell shares of their own fund using a different pricing structure than the Fund. Such different pricing structures may result in differences in returns experienced by investors in other funds that invest in the Portfolio. Such differences in returns are not uncommon and are present in other mutual fund structures. Information concerning other holders of interests in the Portfolio is available from Morgan at (800) 521-5411. The Trust may withdraw the investment of a Fund from a Portfolio at any time if the Board of Trustees of the Trust determines that it is in the best interests of the Fund to do so. Upon any such withdrawal, the Board of Trustees would consider what action might be taken, including the investment of all the assets of the Fund in another pooled investment entity having the same investment objective and restrictions in accordance with the investment policies with respect to the Portfolio described above and in each Fund's Prospectus. Certain changes in a Portfolio's fundamental investment policies or restrictions, or a failure by a Fund's shareholders to approve such change in the Portfolio's investment restrictions, may require withdrawal of the Fund's interest in the Portfolio. Any such withdrawal could result in a distribution in kind of portfolio securities (as opposed to a cash distribution) from the Portfolio which may or may not be readily marketable. The distribution in kind may result in the Fund having a less diversified portfolio of investments or adversely affect the Fund's liquidity, and the Fund could incur brokerage, tax or other charges in converting the securities to cash. Notwithstanding the above, there are other means for meeting shareholder redemption requests, such as borrowing. Smaller funds investing in a Portfolio may be materially affected by the actions of larger funds investing in the Portfolio. For example, if a large fund withdraws from the Portfolio, the remaining funds may subsequently experience higher pro rata operating expenses, thereby producing lower returns. Additionally, because a Portfolio would become smaller, it may become less diversified, resulting in potentially increased portfolio risk (however, these possibilities also exist for traditionally structured funds which have large or institutional investors who may withdraw from a fund). Also, funds with a greater pro rata ownership in the Portfolio could have effective voting control of the operations of the Portfolio. Whenever the Fund is -29- requested to vote on matters pertaining to the Portfolio (other than a vote by the Fund to continue the operation of the Portfolio upon the withdrawal of another investor in the Portfolio), the Trust will hold a meeting of shareholders of the Fund and will cast all of its votes proportionately as instructed by the Fund's shareholders. The Trust will vote the shares held by Fund shareholders who do not give voting instructions in the same proportion as the shares of Fund shareholders who do give voting instructions. Shareholders of the Fund who do not vote will have no affect on the outcome of such matters. TAXES The following discussion of tax consequences is based on U.S. federal tax laws in effect on the date of this Statement of Additional Information. These laws and regulations are subject to change by legislative or administrative action, possibly on a retroactive basis. Each Fund intends to qualify and remain qualified as a regulated investment company under Subchapter M of the Code. As a regulated investment company, a Fund must, among other things, (a) derive at least 90% of its gross income from dividends, interest, payments with respect to loans of stock and securities, gains from the sale or other disposition of stock, securities or foreign currency and other income (including but not limited to gains from options, futures, and forward contracts) derived with respect to its business of investing in such stock, securities or foreign currency; and (b) diversify its holdings so that, at the end of each fiscal quarter of its taxable year, (i) at least 50% of the value of the Fund's total assets is represented by cash, cash items, U.S. Government securities, investments of other regulated investment companies, and other securities limited, in respect of any one issuer, to an amount not greater than 5% of the Fund's total assets, and 10% of the outstanding voting securities of such issuer, and (ii) not more than 25% of the value of its total assets is invested in the securities of any one issuer (other than U.S. Government securities or securities of other regulated investment companies). As a regulated investment company, a Fund (as opposed to its shareholders) will not be subject to federal income taxes on the net investment income and capital gain that it distributes to its shareholders, provided that at least 90% of its net investment income and realized net short-term capital gain in excess of net long-term capital loss for the taxable year is distributed in accordance with the Code's timing requirements. Under the Code, a Fund will be subject to a 4% excise tax on a portion of its undistributed taxable income and capital gains if it fails to meet certain distribution requirements by the end of the calendar year. Each Fund intends to make distributions in a timely manner and accordingly does not expect to be subject to the excise tax. For federal income tax purposes, dividends that are declared by a Fund in October, November or December as of a record date in such month and actually paid in January of the following year will be treated as if they were paid on December 31 of the year declared. Therefore, such dividends generally, will be taxable to a shareholder in the year declared rather than the year paid. For federal income tax purposes, the following funds have capital loss carry-forwards for the periods indicated: Institutional Service Prime Money Market Fund: For the fiscal year ended November 30, 2000, $58,295, of which $6 will expire in the year 2005, $5,275 will expire in 2006, and $53,014 will expire in 2007. Institutional Service Treasury Money Market Fund: For the fiscal year ended October 31, 2000, $172,502, of which $4,308 will expire in the year 2006, $26,680 will expire in 2007 and $141,514, will expire in the year 2008 Institutional Service Federal Money Market Fund: For the fiscal year ended October 31, 2000, $4,351all of which will expire in 2007. To the extent that this capital loss is used to offset future capital gains, it is probable that gains so offset will not be distributed to shareholders. -30- Distributions of net investment income and realized net short-term capital gains in excess of net long-term capital loss are generally taxable to shareholders of the Funds as ordinary income whether such distributions are taken in cash or reinvested in additional shares. Distributions to corporate shareholders of the Funds are not eligible for the dividends received deduction. Distributions of net long-term capital gains (i.e., net long-term capital gains in excess of net short-term capital loss) are taxable to shareholders of a Fund as long-term capital gain, regardless of whether such distributions are taken in cash or reinvested in additional shares and regardless of how long a shareholder has held shares in the Fund. In general, long-term capital gain of an individual shareholder will be subject to a 20% rate of tax. To maintain a constant $1.00 per share net asset value, the Trustees of the Trust may direct that the number of outstanding shares be reduced pro rata. If this adjustment is made, it will reflect the lower market value of portfolio securities and not realized losses. The adjustment may result in a shareholder having more dividend income than net income in his account for a period. When the number of outstanding shares of a Fund is reduced, the shareholder's basis in the shares of the Fund may be adjusted to reflect the difference between taxable income and net dividends actually distributed. This difference may be realized as a capital loss when the shares are liquidated. Subject to certain limited exceptions, capital losses cannot be used to offset ordinary income. See "Net Asset Value." Gains or losses on sales of portfolio securities will be treated as long-term capital gains or losses if the securities have been held for more than one year except in certain cases where, if applicable a put option is acquired or a call option is written thereon or straddle rules are otherwise applicable. Other gains or losses on the sale of securities will be short-term capital gains or losses. Gains and losses on the sale, lapse or other termination of options on securities will be treated as gains and losses from the sale of securities. If an option written by a Portfolio lapses or is terminated through a closing transaction, such as a repurchase by the Portfolio of the option from its holder, the Portfolio will realize a short-term capital gain or loss, depending on whether the premium income is greater or less than the amount paid by the Portfolio in the closing transaction. If securities are purchased by a Portfolio pursuant to the exercise of a put option written by it, the Portfolio will subtract the premium received from its cost basis in the securities purchased. Any distribution of net investment income or capital gains will have the effect of reducing the net asset value of Fund shares held by a shareholder by the same amount as the distribution. If the net asset value of the shares is reduced below a shareholder's cost as a result of such a distribution, the distribution, although constituting a return of capital to the shareholder, will be taxable as described above. Investors should thus consider the consequences of purchasing shares in a Fund shortly before the Fund declares a sizable dividend distribution. Any gain or loss realized on the redemption or exchange of Fund shares by a shareholder who is not a dealer in securities will be treated as long-term capital gain or loss if the shares have been held for more than one year, and otherwise as short-term capital gain or loss. Long-term capital gain of an individual holder generally is subject to a maximum tax rate of 20%. However, if Fund shares are acquired by an individual after December 31, 2000 and held for more than five years, the maximum long-term capital gain tax to rate generally will be reduced to 18%. Any loss realized by a shareholder upon the redemption or exchange of shares in the Fund held for six months or less will be treated as a long-term capital loss to the extent of any long-term capital gain distributions received by the shareholder with respect to such shares. Additionally, any loss realized on a redemption or exchange of shares of a Fund will be disallowed to the extent the shares disposed of are replaced within a period of 61 days beginning 30 days before such disposition, such as pursuant to reinvestment of a dividend in shares of the Fund. Investors are urged to consult their tax advisors concerning the limitations on the deductibility of capital losses. If a correct and certified taxpayer identification number is not on file, the Fund is required, subject to certain exemptions, to withold 31% of certain payments made or distributions declared to non-corporate shareholders. -31- Foreign Shareholders. Dividends of net investment income and distributions of realized net short-term gain in excess of net long-term loss to a shareholder who, as to the United States, is a nonresident alien individual, fiduciary of a foreign trust or estate, foreign corporation or foreign partnership (a "foreign shareholder") will be subject to U.S. withholding tax at the rate of 30% (or lower treaty rate) unless the dividends are effectively connected with a U.S. trade or business of the shareholder, in which case the dividends will be subject to tax on a net income basis at the graduated rates applicable to U.S. individuals or domestic corporations. Generally, a foreign shareholder must satisfy certain certification requirements in order to claim the benefit of a lower treaty rate. In addition, in the case of Fund shares held by a foreign partnership, the certification requirement generally will also apply to the partners of the partnership and the partnership must provide certain information. A foreign shareholder that is eligible for a reduced rate of United States withholding tax under tax treaty may obtain a refund of any amounts withheld in excess of that rate by filing a refund claim with the United States Internal Revenue Service. Distributions treated as long-term capital gains to foreign shareholders will not be subject to U.S. tax unless the distributions are effectively connected with the shareholder's trade or business in the United States or, in the case of a shareholder who is a nonresident alien individual, the shareholder was present in the United States for more than 182 days during the taxable year and certain other conditions are met. In the case of a foreign shareholder who is a nonresident alien individual or foreign entity and that is a beneficial owner of Fund shares, a Fund may be required to withhold U.S. federal income tax as "backup withholding" at the rate of 31% from any distributions including distributions treated as long-term capital gains and from the proceeds of redemptions, exchanges or other dispositions of Fund shares unless such foreign shareholder provides an IRS Form W-8BEN certifying that it is a non-U.S. person for U.S. federal income tax purposes, or otherwise established an exemption. Transfers by gift of shares of a Fund by a foreign shareholder who is a nonresident alien individual will not be subject to U.S. federal gift tax, but the value of shares of the Fund held by such a shareholder at his or her death will be includible in his or her gross estate for U.S. federal estate tax purposes. State and Local Taxes. Each Fund may be subject to state or local taxes in jurisdictions in which the Fund is deemed to be doing business. In addition, the treatment of a Fund and its shareholders in those states which have income tax laws might differ from treatment under the federal income tax laws. Shareholders should consult their own tax advisors with respect to any state or local taxes. Other Taxation. The Trust is organized as a Massachusetts business trust and, under current law, neither the Trust nor any Fund is liable for any income or franchise tax in The Commonwealth of Massachusetts, provided that each Fund continues to qualify as a regulated investment company under Subchapter M of the Code. The Portfolios are organized as New York trusts. The Portfolios are not subject to any federal income taxation or income or franchise tax in the State of New York or The Commonwealth of Massachusetts. The investment by a Fund in its corresponding Portfolio does not cause the Fund to be liable for any income or franchise tax in the State of New York. ADDITIONAL INFORMATION As used in this Statement of Additional Information and the Prospectus, the term "majority of the outstanding voting securities" means the vote of (i) 67% or more of the Fund's shares or the Portfolio's outstanding voting securities present at a meeting, if the holders of more than 50% of the Fund's outstanding shares or the Portfolio's outstanding voting securities are present or represented by proxy, or (ii) more than 50% of the Fund's outstanding shares or the Portfolio's outstanding voting securities, whichever is less. Telephone calls to the Funds, J.P. Morgan or Service Organizations as shareholder servicing agent may be tape recorded. With respect to the securities offered hereby, this Statement of Additional Information and the Prospectus do not contain all the information included in the Trust's registration statement filed with the SEC under -32- the 1933 Act and the 1940 Act and the Portfolios' registration statements filed under the 1940 Act. Pursuant to the rules and regulations of the SEC, certain portions have been omitted. The registration statements including the exhibits filed therewith may be examined at the office of the SEC in Washington, D.C. Statements contained in this Statement of Additional Information and the Prospectus concerning the contents of any contract or other document are not necessarily complete, and in each instance, reference is made to the copy of such contract or other document filed as an exhibit to the applicable Registration Statements. Each such statement is qualified in all respects by such reference. No dealer, salesman or any other person has been authorized to give any information or to make any representations, other than those contained in the Prospectus and this Statement of Additional Information, in connection with the offer contained therein and, if given or made, such other information or representations must not be relied upon as having been authorized by any of the Trust, the Funds or the Distributor. The Prospectus and this Statement of Additional Information do not constitute an offer by any Fund or by the Distributor to sell or solicit any offer to buy any of the securities offered hereby in any jurisdiction to any person to whom it is unlawful for the Fund or the Distributor to make such offer in such jurisdictions. FINANCIAL STATEMENTS The following financial statements and the report thereon of PricewaterhouseCoopers LLP of each Fund (except the Federal Money Market Fund) are incorporated herein by reference from their respective annual report filings made with the SEC pursuant to Section 30(b) of the 1940 Act and Rule 30b2-1 thereunder. Any of the following financial reports are available without charge upon request by calling JP Morgan Funds Services at (800) 766-7722. Each Fund's financial statements include the financial statements of the Fund's corresponding Portfolio.
- --------------------------------------------------------------------------------------------------------- Date of Annual Report; Date Annual Report Filed; and Name of Fund/Portfolio Accession Number - --------------------------------------------------------------------------------------------------------- J.P. Morgan Institutional Service Prime Money 11/30/00 Market Fund 12/26/00 0000894088-00-000085 - --------------------------------------------------------------------------------------------------------- J.P. Morgan Institutional Service Treasury Money 10/31/00 Market Fund 12/28/00 0000894088-00-000032 - --------------------------------------------------------------------------------------------------------- J.P. Morgan Institutional Service Federal Money 10/31/00 Market Fund 12/27/00 0000894089-00-000028 - ---------------------------------------------------------------------------------------------------------
-33- APPENDIX A Description of Security Ratings STANDARD & POOR'S Corporate and Municipal Bonds AAA - Debt rated AAA have the highest ratings assigned by Standard & Poor's to a debt obligation. Capacity to pay interest and repay principal is extremely strong. AA - Debt rated AA have a very strong capacity to pay interest and repay principal and differ from the highest rated issues only in a small degree. A - Debt rated A have a strong capacity to pay interest and repay principal although they are somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than debt in higher rated categories. BBB - Debt rated BBB are regarded as having an adequate capacity to pay interest and repay principal. Whereas they normally exhibit adequate protection parameters, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to pay interest and repay principal for debt in this category than for debt in higher rated categories. Commercial Paper, including Tax Exempt A - Issues assigned this highest rating are regarded as having the greatest capacity for timely payment. Issues in this category are further refined with the designations 1, 2, and 3 to indicate the relative degree of safety. A-1 - This designation indicates that the degree of safety regarding timely payment is very strong. Short-Term Tax-Exempt Notes SP-1 - The short-term tax-exempt note rating of SP-1 is the highest rating assigned by Standard & Poor's and has a very strong or strong capacity to pay principal and interest. Those issues determined to possess overwhelming safety characteristics are given a "plus" (+) designation. SP-2 - The short-term tax-exempt note rating of SP-2 has a satisfactory capacity to pay principal and interest. A-1 MOODY'S Corporate and Municipal Bonds Aaa - Bonds which are rated Aaa are judged to be of the best quality. They carry the smallest degree of investment risk and are generally referred to as "gilt edge." Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues. Aa - Bonds which are rated Aa are judged to be of high quality by all standards. Together with the Aaa group they comprise what are generally known as high grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in Aaa securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long term risks appear somewhat larger than in Aaa securities. A - Bonds which are rated A possess many favorable investment attributes and are to be considered as upper medium grade obligations. Factors giving security to principal and interest are considered adequate but elements may be present which suggest a susceptibility to impairment sometime in the future. Baa - Bonds which are rated Baa are considered as medium grade obligations, i.e., they are neither highly protected nor poorly secured. Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well. Commercial Paper, including Tax Exempt Prime-1 - Issuers rated Prime-1 (or related supporting institutions) have a superior capacity for repayment of short-term promissory obligations. Prime-1 repayment capacity will normally be evidenced by the following characteristics: - Leading market positions in well established industries. - High rates of return on funds employed. - Conservative capitalization structures with moderate reliance on debt and ample asset protection. - Broad margins in earnings coverage of fixed financial charges and high internal cash generation. - Well established access to a range of financial markets and assured sources of alternate liquidity. A-2 Short-Term Tax Exempt Notes MIG-1 - The short-term tax-exempt note rating MIG-1 is the highest rating assigned by Moody's for notes judged to be the best quality. Notes with this rating enjoy strong protection from established cash flows of funds for their servicing or from established and broad-based access to the market for refinancing, or both. MIG-2 - MIG-2 rated notes are of high quality but with margins of protection not as large as MIG-1. A-3 EX-99.17(F) 7 a2044397zex-99_17f.txt EXHIBIT 99.17(F) - ----------------------------------------------------------------------------- AUGUST 31, 2000 - ----------------------------------------------------------------------------- Chase Vista Money Market Funds ANNUAL REPORT 100% U.S. TREASURY SECURITIES MONEY MARKET FUND U.S. GOVERNMENT MONEY MARKET FUND TREASURY PLUS MONEY MARKET FUND FEDERAL MONEY MARKET FUND CASH MANAGEMENT FUND PRIME MONEY MARKET FUND TAX FREE MONEY MARKET FUND NEW YORK TAX FREE MONEY MARKET FUND CALIFORNIA TAX FREE MONEY MARKET FUND [Chase Logo] THE RIGHT RELATIONSHIP IS EVERYTHING.[RegTM] ANMM-2-1000 - ---------------------------------------------------------------------------- Contents - ----------------------------------------------------------------------------
Chairman's Letter 1 Chase Vista 100% U.S. Treasury Securities Money Market Fund 2 Fund Facts Chase Vista U.S. Government Money Market Fund 3 Fund Facts Chase Vista Treasury Plus Money Market Fund 4 Fund Facts Chase Vista Federal Money Market Fund 5 Fund Facts Chase Vista Cash Management Fund 6 Fund Facts Chase Vista Prime Money Market Fund 7 Fund Facts Chase Vista Tax Free Money Market Fund 8 Fund Facts Chase Vista New York Tax Free Money Market Fund 9 Fund Facts Chase Vista California Tax Free Money Market Fund 10 Fund Facts Portfolios of Investments 11 Financial Statements 60 Notes to Financial Statements 71
Highlights o In light of very strong economic growth in the U.S., the Federal Reserve Board continued its policy of raising short-term interest rates. At the end of the reporting period, the Federal Funds rate stood at 6.5%. o By June 2000, the first signs of moderation began to appear in the economy, and subsequent data seemed to confirm the slowdown. o Along with official Fed moves, yields on money market securities moved higher for most of the reporting year before stabilizing. --------------------------------------------------------- NOT FDIC INSURED | May lose value / No bank guarantee --------------------------------------------------------- Chase Vista Funds are distributed by Vista Fund Distributors, Inc. - -------------------------------------------------------------------------------- CHASE VISTA MONEY MARKET FUNDS - -------------------------------------------------------------------------------- Chairman's Letter October 2, 2000 Dear Shareholder: We are pleased to present this annual report on each of the Chase Vista Money Market Funds. Inside, you will find current seven-day yields and a current list of holdings for each fund as of August 31, 2000, the final day of the reporting year. After Extended Burst of Growth, U.S. Economy Appears to Slow For the great majority of the reporting year, the United States economy continued to expand at a rapid pace, with GDP growth soaring well in excess of the 3.5% that many analysts consider to be the Federal Reserve Board's maximum non-inflationary trend rate. In response, the Fed continued its policy of short-term interest rate increases, creating a generally negative backdrop for the fixed-income markets. The exception was the long-term U.S. Treasury market, which benefited from the February announcement and subsequent implementation of a plan by the United States Treasury department to use proceeds of the budget surplus to "buy back" longer-term Treasuries. This had the effect of creating an inverted Treasury yield curve, where investors were paid more for holding shorter-term Treasury securities than longer-term issues. In June, with shifting economic data showing a slowing economy, investors decided that the six Fed rate increases over the previous year had begun to take effect. As evidence of a slowdown continued to mount, the bullish view was that the Fed would achieve another "soft landing" in which growth will moderate but not disappear. As of this writing, the Fed has kept the short-term rate unchanged for four months. However, with several potentially troubling issues on the horizon--including the price of crude oil rising to all-time highs--investors are eagerly awaiting the upcoming third quarter GDP figures to understand the full extent of the economy's slowdown. In this environment, your portfolio managers did an excellent job, maintaining competitive yields while maintaining the $1 net asset value per share. All of us at Chase thank you for your continued investment and look forward to helping you reach your financial goals for many years to come. Sincerely yours, /s/ Fergus Reid Fergus Reid Chairman 1 - -------------------------------------------------------------------------------- CHASE VISTA 100% U.S. TREASURY SECURITIES MONEY MARKET FUND As of August 31, 2000 (Unaudited) - -------------------------------------------------------------------------------- Fund Facts - -------------------------------------------------------------------------------- Objective | High current income consistent with | capital preservation - -------------------------------------------------------------------------------- Primary investments | Direct obligations of the U.S. Treasury | including Treasury bills, bonds and notes - -------------------------------------------------------------------------------- Suggested investment time frame | Short-term - -------------------------------------------------------------------------------- Share classes offered | Vista, Premier and Institutional Shares - -------------------------------------------------------------------------------- Net assets | $4.5 Billion - -------------------------------------------------------------------------------- Average maturity | 73 days - -------------------------------------------------------------------------------- S&P Rating | Not Rated - -------------------------------------------------------------------------------- Moody's Rating | Not Rated - -------------------------------------------------------------------------------- NAIC Rating | Not Rated - --------------------------------------------------------------------------------
Maturity Schedule - ------------------------------ 1-14 days | 0.00% - ------------------------------ 15-30 days | 35.47% - ------------------------------ 31-60 days | 0.00% - ------------------------------ 61-90 days | 29.41% - ------------------------------ 91-180 days | 29.06% - ------------------------------ 181-270 days | 3.09% - ------------------------------ 271+ days | 2.97% - ------------------------------
7-Day SEC Yield(1) - ------------------------------ Vista Shares | 5.62% - ------------------------------ Premier Shares | 5.73% - ------------------------------ Institutional Shares | 5.96% - ------------------------------
Past performance is not a guarantee of future results. Yields will fluctuate. An investment in a money market fund is not insured by the FDIC or any other government agency. Although money market funds strive to preserve the value of the investment at $1.00 per share, it is possible to lose money by investing in a money market fund. (1) The yields for Vista Shares, Premier Shares and Institutional Shares reflect the voluntary waiver of certain expenses. Without waivers, the yields would have been 5.50%, 5.69% and 5.86% for Vista Shares, Premier Shares and Institutional Shares, respectively. This voluntary waiver may be modified or terminated at any time, which would reduce the fund's performance. 2 - -------------------------------------------------------------------------------- CHASE VISTA U.S. GOVERNMENT MONEY MARKET FUND As of August 31, 2000 (Unaudited) - -------------------------------------------------------------------------------- Fund Facts - -------------------------------------------------------------------------------- Objective | High current income consistent with | capital preservation - -------------------------------------------------------------------------------- Primary investments | Direct obligations of the U.S. Treasury and its | Agencies including Treasury bills, bonds, notes | and repurchase agreements - -------------------------------------------------------------------------------- Suggested investment time frame | Short-term - -------------------------------------------------------------------------------- Share classes offered | Vista, Premier and Institutional Shares - -------------------------------------------------------------------------------- Net assets | $7.2 Billion - -------------------------------------------------------------------------------- Average maturity | 50 days - -------------------------------------------------------------------------------- S&P Rating* | AAA - -------------------------------------------------------------------------------- Moody's Rating* | Aaa - -------------------------------------------------------------------------------- NAIC Rating* | Class 1 - --------------------------------------------------------------------------------
* This rating is historical and is based upon the Fund's credit quality, market price exposure and management. It signifies that the Fund's safety is excellent and that it has superior capacity to maintain a $1 Net Asset Value per share. The National Association of Insurance Commissioners' (NAIC's) Class 1 status indicates that the Fund meets certain pricing and quality guidelines. Maturity Schedule - ----------------------------- 1-14 days | 64.32% - ----------------------------- 15-30 days | 2.75% - ----------------------------- 31-60 days | 7.06% - ----------------------------- 61-90 days | 5.11% - ----------------------------- 91-180 days | 10.95% - ----------------------------- 181-270 days | 5.66% - ----------------------------- 271+ days | 4.15% - -----------------------------
7-Day SEC Yield(1) - ------------------------------- Vista Shares | 6.06% - ------------------------------- Premier Shares | 6.20% - ------------------------------- Institutional Shares | 6.39% - -------------------------------
Past performance is not a guarantee of future results. Yields will fluctuate. An investment in a money market fund is not insured by the FDIC or any other government agency. Although money market funds strive to preserve the value of the investment at $1.00 per share, it is possible to lose money by investing in a money market fund. (1) The yields for Vista Shares, Premier Shares and Institutional Shares reflect the voluntary waiver of certain expenses. Without waivers, the yields would have been 5.97%, 6.07% and 6.33% for Vista Shares, Premier Shares and Institutional Shares, respectively. This voluntary waiver may be modified or terminated at any time, which would reduce the fund's performance. 3 - -------------------------------------------------------------------------------- CHASE VISTA TREASURY PLUS MONEY MARKET FUND As of August 31, 2000 (Unaudited) - -------------------------------------------------------------------------------- Fund Facts - -------------------------------------------------------------------------------- Objective | High current income consistent with | capital preservation - -------------------------------------------------------------------------------- Primary investments | Direct obligations of the U.S. Treasury | including Treasury bills, bonds and notes | as well as repurchase agreements which | are fully collateralized by obligations | issued or guaranteed by the U.S. Treasury - -------------------------------------------------------------------------------- Suggested investment time frame | Short-term - -------------------------------------------------------------------------------- Share classes offered | Vista, Premier and Institutional Shares - -------------------------------------------------------------------------------- Net assets | $2.5 Billion - -------------------------------------------------------------------------------- Average maturity | 4 days - -------------------------------------------------------------------------------- S&P Rating* | AAA - -------------------------------------------------------------------------------- Moody's Rating* | Aaa - -------------------------------------------------------------------------------- NAIC Rating* | Exempt - --------------------------------------------------------------------------------
* This rating is historical and is based upon the Fund's credit quality, market price exposure and management. It signifies that the Fund's safety is excellent and that it has superior capacity to maintain a $1 Net Asset Value per share. The National Association of Insurance Commissioners' (NAIC's) "exempt" status indicates that the Fund meets certain pricing and quality guidelines. Maturity Schedule - ----------------------------- 1-14 days | 77.10% - ----------------------------- 15-30 days | 22.90% - ----------------------------- 31-60 days | 0.00% - ----------------------------- 61-90 days | 0.00% - ----------------------------- 91-180 days | 0.00% - ----------------------------- 181-270 days | 0.00% - ----------------------------- 271+ days | 0.00% - -----------------------------
7-Day SEC Yield(1) - ------------------------------------ Vista Shares | 5.97% - ------------------------------------ Premier Shares | 6.11% - ------------------------------------ Institutional Shares | 6.31% - ------------------------------------
Past performance is not a guarantee of future results. Yields will fluctuate. An investment in a money market fund is not insured by the FDIC or any other government agency. Although money market funds strive to preserve the value of the investment at $1.00 per share, it is possible to lose money by investing in a money market fund. (1) The yields for Vista Shares, Premier Shares and Institutional Shares reflect the voluntary waiver of certain expenses. Without waivers, the yields would have been 5.85%, 6.05% and 6.20% for Vista Shares, Premier Shares and Institutional Shares, respectively. This voluntary waiver may be modified or terminated at any time, which would reduce the fund's performance. 4 - -------------------------------------------------------------------------------- CHASE VISTA FEDERAL MONEY MARKET FUND As of August 31, 2000 (Unaudited) - -------------------------------------------------------------------------------- Fund Facts - -------------------------------------------------------------------------------------- Objective | High current income consistent with | capital preservation - -------------------------------------------------------------------------------------- Primary investments | Direct obligations of the U.S. Treasury including | Treasury bills, bonds and notes as well as | obligations issued or guaranteed by the U.S. | Treasury and its Agencies - -------------------------------------------------------------------------------------- Suggested investment time frame | Short-term - -------------------------------------------------------------------------------------- Share classes offered | Vista, Premier, Institutional and Reserve Shares - -------------------------------------------------------------------------------------- Net assets | $1.1 Billion - -------------------------------------------------------------------------------------- Average maturity | 59 days - -------------------------------------------------------------------------------------- S&P Rating | Not Rated - -------------------------------------------------------------------------------------- Moody's Rating | Not Rated - -------------------------------------------------------------------------------------- NAIC Rating | Not Rated - --------------------------------------------------------------------------------------
Maturity Schedule - ----------------------------- 1-14 days | 35.45% - ----------------------------- 15-30 days | 26.66% - ----------------------------- 31-60 days | 7.70% - ----------------------------- 61-90 days | 1.30% - ----------------------------- 91-180 days | 12.61% - ----------------------------- 181-270 days | 16.28% - ----------------------------- 271+ days | 0.00% - -----------------------------
7-Day SEC Yield(1) - ------------------------------------ Vista Shares | 5.80% - ------------------------------------ Premier Shares | 6.02% - ------------------------------------ Institutional Shares | 6.24% - ------------------------------------ Reserve Shares | 5.71% - ------------------------------------
Past performance is not a guarantee of future results. Yields will fluctuate. An investment in a money market fund is not insured by the FDIC or any other government agency. Although money market funds strive to preserve the value of the investment at $1.00 per share, it is possible to lose money by investing in a money market fund. (1) The yields for Vista Shares, Institutional Shares and Reserve Shares reflect the voluntary waiver of certain expenses. Without waivers, the yields would have been 5.78%, 6.17% and 5.06% for Vista Shares, Institutional Shares and Reserve Shares, respectively. This voluntary waiver may be modified or terminated at any time, which would reduce the fund's performance. 5 - -------------------------------------------------------------------------------- CHASE VISTA CASH MANAGEMENT FUND As of August 31, 2000 (Unaudited) - -------------------------------------------------------------------------------- Fund Facts - -------------------------------------------------------------------------------- Objective | High current income consistent with | capital preservation - -------------------------------------------------------------------------------- Primary investments | High quality, short-term, U.S. dollar- | denominated money market instruments - -------------------------------------------------------------------------------- Suggested investment time frame | Short-term - -------------------------------------------------------------------------------- Share classes offered | Vista, Premier and Institutional Shares - -------------------------------------------------------------------------------- Net assets | $11.1 Billion - -------------------------------------------------------------------------------- Average maturity | 49 days - -------------------------------------------------------------------------------- S&P Rating | Not Rated - -------------------------------------------------------------------------------- Moody's Rating | Not Rated - -------------------------------------------------------------------------------- NAIC Rating | Not Rated - --------------------------------------------------------------------------------
Maturity Schedule - ----------------------------- 1-14 days | 30.52% - ----------------------------- 15-30 days | 31.88% - ----------------------------- 31-60 days | 11.03% - ----------------------------- 61-90 days | 11.23% - ----------------------------- 91-180 days | 9.41% - ----------------------------- 181-270 days | 4.80% - ----------------------------- 271+ days | 1.13% - -----------------------------
7-Day SEC Yield(1) - ------------------------------------ Vista Shares | 6.14% - ------------------------------------ Premier Shares | 6.28% - ------------------------------------ Institutional Shares | 6.47% - ------------------------------------
Past performance is not a guarantee of future results. Yields will fluctuate. An investment in a money market fund is not insured by the FDIC or any other government agency. Although money market funds strive to preserve the value of the investment at $1.00 per share, it is possible to lose money by investing in a money market fund. (1) The yields for Vista Shares, Premier Shares and Institutional Shares reflect the voluntary waiver of certain expenses. Without waivers, the yields would have been 6.12%, 6.22% and 6.39% for Vista Shares, Premier Shares and Institutional Shares, respectively. This voluntary waiver may be modified or terminated at any time, which would reduce the fund's performance. 6 - -------------------------------------------------------------------------------- CHASE VISTA PRIME MONEY MARKET FUND As of August 31, 2000 (Unaudited) - -------------------------------------------------------------------------------- Fund Facts - -------------------------------------------------------------------------------------------- Objective | High current income consistent with | capital preservation - -------------------------------------------------------------------------------------------- Primary investments | High quality, short-term, U.S. dollar- | denominated money market instruments - -------------------------------------------------------------------------------------------- Suggested investment time frame | Short-term - -------------------------------------------------------------------------------------------- Share classes offered | Vista, Premier, Institutional, Reserve, B and C Shares - -------------------------------------------------------------------------------------------- Net assets | $12.8 Billion - -------------------------------------------------------------------------------------------- Average maturity | 50 days - -------------------------------------------------------------------------------------------- S&P Rating* | AAA - -------------------------------------------------------------------------------------------- Moody's Rating* | Aaa - -------------------------------------------------------------------------------------------- NAIC Rating* | Class 1 - --------------------------------------------------------------------------------------------
* This rating is historical and is based upon the Fund's credit quality, market price exposure and management. It signifies that the Fund's safety is excellent and that it has superior capacity to maintain a $1 Net Asset Value per share. The National Association of Insurance Commissioners' (NAIC's) Class 1 status indicates that the Fund meets certain pricing and quality guidelines. Maturity Schedule - ----------------------------- 1-14 days | 34.98% - ----------------------------- 15-30 days | 37.76% - ----------------------------- 31-60 days | 4.94% - ----------------------------- 61-90 days | 4.34% - ----------------------------- 91-180 days | 11.42% - ----------------------------- 181-270 days | 4.86% - ----------------------------- 271+ days | 1.70% - -----------------------------
7-Day SEC Yield(1) - ------------------------------------ B Shares | 5.46% - ------------------------------------ C Shares | 5.46% - ------------------------------------ Vista Shares | 6.11% - ------------------------------------ Premier Shares | 6.24% - ------------------------------------ Institutional Shares | 6.43% - ------------------------------------ Reserve Shares | 5.90% - ------------------------------------
Past performance is not a guarantee of future results. Yields will fluctuate. An investment in a money market fund is not insured by the FDIC or any other government agency. Although money market funds strive to preserve the value of the investment at $1.00 per share, it is possible to lose money by investing in a money market fund. (1) The yields for B Shares, C Shares, Vista Shares, Premier Shares, Institutional Shares and Reserve Shares reflect the voluntary waiver of certain expenses. Without waivers, the yields would have been 5.45%, 5.45%, 6.10%, 6.21%, 6.36% and 5.24% for B Shares, C Shares, Vista Shares, Premier Shares, Institutional Shares and Reserve Shares, respectively. This voluntary waiver may be modified or terminated at any time, which would reduce the fund's performance. 7 - -------------------------------------------------------------------------------- CHASE VISTA TAX FREE MONEY MARKET FUND As of August 31, 2000 (Unaudited) - -------------------------------------------------------------------------------- Fund Facts - ------------------------------------------------------------------------------------- Objective | High current tax free income consistent | with capital preservation* - ------------------------------------------------------------------------------------- Primary investments | Short-term municipal obligations - ------------------------------------------------------------------------------------- Suggested investment time frame | Short-term - ------------------------------------------------------------------------------------- Share classes offered | Vista, Premier, Institutional and Reserve Shares - ------------------------------------------------------------------------------------- Net assets | $1.7 Billion - ------------------------------------------------------------------------------------- Average maturity | 55 days - ------------------------------------------------------------------------------------- S&P Rating** | AAA - ------------------------------------------------------------------------------------- Moody's Rating | Not rated - ------------------------------------------------------------------------------------- NAIC Rating | Not rated - -------------------------------------------------------------------------------------
** This rating is historical and is based upon the Fund's credit quality, market price exposure and management. It signifies that the Fund's safety is excellent and that it has superior capacity to maintain a $1 Net Asset Value per share. Maturity Schedule - ----------------------------- 1-7 days | 67.63% - ----------------------------- 8-30 days | 4.37% - ----------------------------- 31-90 days | 8.18% - ----------------------------- 91-180 days | 8.76% - ----------------------------- 181-270 days | 4.23% - ----------------------------- 271+ days | 6.83% - -----------------------------
Yields
Taxable 7-Day Equivalent SEC Yield(1) Yield(2) - ----------------------------------------------------- Vista Shares | 3.73% | 6.18% - ----------------------------------------------------- Premier Shares | 3.80% | 6.29% - ----------------------------------------------------- Institutional Shares | 4.06% | 6.72% - ----------------------------------------------------- Reserve Shares | 3.52% | 5.83% - -----------------------------------------------------
Past performance is not a guarantee of future results. Yields will fluctuate. An investment in a money market fund is not insured by the FDIC or any other government agency. Although money market funds strive to preserve the value of the investment at $1.00 per share, it is possible to lose money by investing in a money market fund. (1) The yields for Vista Shares, Premier Shares, Institutional Shares and Reserve Shares reflect the voluntary waiver of certain expenses. Without waivers, the yields would have been 3.61%, 3.80%, 3.96% and 2.87% for Vista Shares, Premier Shares, Institutional Shares and Reserve Shares, respectively. This voluntary waiver may be modified or terminated at any time, which would reduce performance. (2) Taxable equivalent yields are calculated based on the SEC yield divided by 1 minus the effective tax rate. The effective federal tax rate used for this illustration is 39.6%. * A portion of the Fund's income may be subject to the Alternative Minimum Tax (AMT), and some investors may be subject to certain state and local taxes. 8 - -------------------------------------------------------------------------------- CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND As of August 31, 2000 (Unaudited) - -------------------------------------------------------------------------------- Fund Facts - -------------------------------------------------------------------------------- Objective | High current tax free income consistent | with capital preservation* - -------------------------------------------------------------------------------- Primary investments | New York short-term municipal obligations - -------------------------------------------------------------------------------- Suggested investment time frame | Short-term - -------------------------------------------------------------------------------- Share classes offered | Vista and Reserve Shares - -------------------------------------------------------------------------------- Net assets | $1.8 Billion - -------------------------------------------------------------------------------- Average maturity | 54 days - -------------------------------------------------------------------------------- S&P Rating | Not rated - -------------------------------------------------------------------------------- Moody's Rating | Not rated - -------------------------------------------------------------------------------- NAIC Rating | Not rated - --------------------------------------------------------------------------------
Maturity Schedule - ----------------------------- 1-7 days | 72.53% - ----------------------------- 8-30 days | 0.23% - ----------------------------- 31-90 days | 8.78% - ----------------------------- 91-180 days | 3.93% - ----------------------------- 181-270 days | 4.33% - ----------------------------- 271+ days | 10.20% - -----------------------------
Yields
Taxable 7-Day Equivalent SEC Yield(1) Yield(2) - ------------------------------------------------- Vista Shares | 3.59% | 6.65% - ------------------------------------------------- Reserve Shares | 3.39% | 6.28% - -------------------------------------------------
Past performance is not a guarantee of future results. Yields will fluctuate. An investment in a money market fund is not insured by the FDIC or any other government agency. Although money market funds strive to preserve the value of the investment at $1.00 per share, it is possible to lose money by investing in a money market fund. (1) The yields for Vista Shares and Reserve Shares reflect the voluntary waiver of certain expenses. Without waivers, the yield would have been 3.48% for Vista Shares and 2.69% for Reserve Shares. This voluntary waiver may be modified or terminated at any time, which would reduce performance. (2) Taxable Equivalent Yields are calculated based on the SEC yield divided by 1 minus the effective tax rate. The effective combined federal, state and local tax rate used for this illustration is 46.05%. * A portion of the Fund's income may be subject to the Alternative Minimum Tax (AMT), and some investors may be subject to certain state and local taxes. 9 - -------------------------------------------------------------------------------- CHASE VISTA CALIFORNIA TAX FREE MONEY MARKET FUND As of August 31, 2000 (Unaudited) - -------------------------------------------------------------------------------- Fund Facts - -------------------------------------------------------------------------------- Objective | High current tax free income consistent with capital preservation* - -------------------------------------------------------------------------------- Primary investments | California short-term municipal obligations - -------------------------------------------------------------------------------- Suggested investment time frame | Short-term - -------------------------------------------------------------------------------- Share Classes Offered | Vista Shares - -------------------------------------------------------------------------------- Net assets | $77.5 Million - -------------------------------------------------------------------------------- Average maturity | 46 days - -------------------------------------------------------------------------------- S&P Rating | Not rated - -------------------------------------------------------------------------------- Moody's Rating | Not rated - -------------------------------------------------------------------------------- NAIC Rating | Not rated - --------------------------------------------------------------------------------
Maturity Schedule - ----------------------------- 1-7 days | 73.85% - ----------------------------- 8-30 days | 7.67% - ----------------------------- 31-90 days | 1.80% - ----------------------------- 91-180 days | 8.64% - ----------------------------- 181-270 days | 0.00% - ----------------------------- 271+ days | 8.04% - -----------------------------
Yields
Taxable 7-Day Equivalent SEC Yield(1) Yield(2) - ------------------------------------------------ Vista Shares 3.25% 5.93% - ------------------------------------------------
Past performance is not a guarantee of future results. Yields will fluctuate. An investment in a money market fund is not insured by the FDIC or any other government agency. Although money market funds strive to preserve the value of the investment at $1.00 per share, it is possible to lose money by investing in a money market fund. (1) The yield for Vista Shares reflects the voluntary waiver of certain expenses. Without waivers, the yield would have been 3.00%. This voluntary waiver may be modified or terminated at any time, which would reduce performance. (2) Taxable Equivalent Yields are calculated based on the SEC yield divided by 1 minus the effective tax rate. The effective combined federal, state and local tax rate used for this illustration is 45.22%. * A portion of the Fund's income may be subject to the Alternative Minimum Tax (AMT), and some investors may be subject to certain state and local taxes. 10 - -------------------------------------------------------------------------------- CHASE VISTA 100% U.S. TREASURY SECURITIES MONEY MARKET FUND Portfolio of Investments - -------------------------------------------------------------------------------- As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - -------------------------------------------------------------------------------- Money Market Instruments -- 99.5% - -------------------------------------------------------------------------------- U.S. Treasury Securities -- 99.5% ------------------------------------ U.S. Treasury Bills, $ 82,730 6.19%, 11/16/00 $ 81,666 75,000 6.21%, 11/24/00 73,931 33,511 6.32%, 09/21/00 33,393 6,374 6.38%, 09/21/00 6,352 1,500,000 6.44%, 09/15/00 1,496,252 U.S. Treasury Notes, 745,000 4.00%, 10/31/00 742,336 230,000 4.50%, 01/31/01 228,264 627,000 4.63%, 11/30/00 624,528 100,000 5.00%, 02/28/01 99,336 135,000 5.25%, 05/31/01 133,855 225,000 5.38%, 02/15/01 223,979 231,500 5.63%, 11/30/00 231,099 40,000 5.63%, 05/15/01 39,786 426,000 5.75%, 11/15/00 425,599 60,502 6.13%, 09/30/00 60,500 - -------------------------------------------------------------------------------- Total Investments -- 99.5% $4,500,876 (Cost $4,500,876)* - --------------------------------------------------------------------------------
See notes to financial statements. 11 - -------------------------------------------------------------------------------- CHASE VISTA U.S. GOVERNMENT MONEY MARKET FUND Portfolio of Investments - -------------------------------------------------------------------------------- As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - -------------------------------------------------------------------------------- Money Market Instruments -- 100.9% - -------------------------------------------------------------------------------- U.S. Government Agency Securities -- 100.2% -------------------------------------------- Federal Farm Credit Bank -- 1.3% $ 90,000 Federal Farm Credit Bank, FRN, 6.54%, 03/01/01 $ 90,000 Federal Home Loan Bank -- 25.6% Federal Home Loan Bank, 111,600 6.04%, 10/25/00 111,600 100,000 6.55%, 02/15/01 100,000 100,000 6.70%, 03/01/01 100,000 75,000 6.75%, 03/01/01 75,000 38,000 7.00%, 05/18/01 38,000 50,000 7.16%, 07/17/01 49,992 50,000 7.17%, 07/13/01 50,000 100,000 DN, 6.44%, 03/09/01 96,824 450,000 DN, 6.51%, 09/01/00 450,000 200,000 FRN, 6.48%, 07/18/01 199,877 250,000 FRN, 6.55%, 10/10/00 249,977 100,000 FRN, 6.67%, 04/12/01 100,000 65,000 FRN, 6.70%, 03/06/01 64,983 150,000 FRN, 6.72%, 05/10/01 149,948 ---------- 1,836,201 Federal Home Loan Mortgage Corp. -- 13.8% Federal Home Loan Mortgage Corp., 175,000 DN, 6.50%, 11/16/00 172,636 90,900 DN, 6.60%, 01/04/01 88,874 200,000 DN, 6.62%, 02/14/01 194,102 135,189 DN, 6.70%, 12/07/00 132,825 100,000 MTN, 6.75%, 04/27/01 100,000 100,000 MTN, 6.90%, 08/24/01 100,000 100,000 MTN, +, 6.90%, 09/11/01 100,000 100,000 MTN, 7.10%, 07/17/01 100,000 ---------- 988,437 Federal National Mortgage Association -- 42.4% Federal National Mortgage Association, 150,000 DN, 6.34%, 10/12/00 148,949 200,000 DN, 6.50%, 11/16/00 197,298 170,096 DN, 6.60%, 01/04/01 166,304 200,000 DN, @, 6.63%, 09/28/00 199,022 111,922 DN, 6.70%, 12/07/00 109,965 250,000 FRN, 6.49%, 06/07/01 249,842 315,000 FRN, 6.53%, 05/24/01 315,000 250,000 FRN, 6.59%, 03/01/01 249,901 310,000 FRN, 6.72%, 05/10/01 309,974 250,000 MTN, FRN, 6.42%, 12/08/00 249,934 150,000 MTN, FRN, 6.59%, 11/06/00 149,976 200,000 MTN, FRN, 6.63%, 09/05/00 199,999 500,000 MTN, FRN, 6.64%, 09/18/00 499,996 ---------- 3,046,160 Student Loan Marketing Association -- 17.1% Student Loan Marketing Association, 150,000 FRN, 6.47%, 09/21/00 150,000 135,000 FRN, 6.57%, 10/19/00 135,000 100,000 FRN, 6.67%, 02/15/01 100,000
See notes to financial statements. 12 CHASE VISTA U.S. GOVERNMENT MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ---------------------------------------------------------------------------------- Money Market Instruments -- Continued - ---------------------------------------------------------------------------------- Student Loan Marketing Association -- Continued $ 200,000 FRN, 6.84%, 07/24/01 $ 199,911 200,000 MTN, FRN, 6.76%, 03/05/01 199,950 175,000 MTN, FRN, 6.77%, 08/09/01 174,921 100,000 MTN, FRN, 6.79%, 08/09/01 99,955 165,000 MTN, FRN, 6.84%, 08/23/01 165,030 ---------- 1,224,767 ------------------------------------------------------------------ Total U.S. Government Agency Securities 7,185,565 (Cost $7,185,565) ------------------------------------------------------------------ Repurchase Agreement -- 0.7% ---------------------------- 49,454 Salomon Smith Barney, Tri Party, 6.66%, due 09/01/00 (Dated 08/31/00, Proceeds $49,463, Secured by FHLMC, $52,107, DN, due 03/01/01; Market Value $50,444) 49,454 (Cost $49,454) - ---------------------------------------------------------------------------------- Total Investments -- 100.9% $7,235,019 (Cost $7,235,019)* - ----------------------------------------------------------------------------------
See notes to financial statements. 13 - -------------------------------------------------------------------------------- CHASE VISTA TREASURY PLUS MONEY MARKET FUND Portfolio of Investments - -------------------------------------------------------------------------------- As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------------ Money Market Instruments -- 100.2% - ------------------------------------------------------------------------------------------ U.S. Treasury Securities -- 22.9% --------------------------------- U.S. Treasury Bills, $ 75,000 6.36%, 09/21/00 $ 74,736 500,000 6.44%, 09/15/00 498,751 -------------------------------------------------------------------------- Total U.S. Treasury Securities 573,487 (Cost $573,487) -------------------------------------------------------------------------- Repurchase Agreements -- 77.3% ------------------------------ 120,000 Bear Stearns, Tri Party, 6.60%, due 09/01/00 (Dated 08/31/00, Proceeds $120,022, Secured by USTR, $127,707, 5.00% through 7.25%, due 11/15/00 through 10/15/06; Market Value $128,475) 120,000 620,000 Deutsche Bank, Tri Party, 6.61%, due 09/01/00 (Dated 08/31/00, Proceeds $620,114, Secured by USTR, $593,827, 4.88% through 8.75%, due 02/15/01 through 11/15/26; Market Value $632,400) 620,000 111,548 Goldman Sachs & Co., Tri Party, 6.58%, due 09/01/00 (Dated 08/31/00, Proceeds $111,568, Secured by USTR, $93,269, 7.88%, due 02/15/21; Market Value $113,780) 111,548 620,000 Greenwich Capital Markets, Inc., Tri Party, 6.60%, due 09/01/00 (Dated 08/31/00, Proceeds $620,114, Secured by USTR, $578,264, 3.63% through 13.25%, due 09/30/00 through 02/15/29; Market Value $631,308) 620,000 100,000 Lehman Brothers, Inc., Tri Party, 6.58%, due 09/01/00 (Dated 08/31/00, Proceeds $100,018, Secured by USTR, $102,149, 5.50% through 6.38%, due 08/31/01 through 08/15/10; Market Value $102,005) 100,000 120,000 Merrill Lynch & Co., Inc., Tri Party, 6.62%, due 09/01/00 (Dated 08/31/00 Proceeds $120,022, Secured by USTR, $98,960, 3.63% through 14.00%, due 11/15/10 through 11/15/28; Market Value $122,404) 120,000 120,000 Morgan Stanley Dean Witter & Co., Tri Party, 6.50%, due 09/01/00 (Dated 08/31/00, Proceeds $120,022, Secured by USTR, $120,312, 6.13% through 7.88%, due 08/15/01 through 08/15/07; Market Value $123,630) 120,000 120,000 Salomon Smith Barney, Tri Party, 6.62%, due 09/01/00 (Dated 08/31/00, Proceeds $120,022, Secured by USTR, $107,055, 5.50% through 12.50%, due 10/05/00 through 08/15/28; Market Value $123,727) 120,000 -------------------------------------------------------------------------- Total Repurchase Agreements 1,931,548 (Cost $1,931,548) - ------------------------------------------------------------------------------------------ Total Investments -- 100.2% $2,505,035 (Cost $2,505,035)* - ------------------------------------------------------------------------------------------
See notes to financial statements. 14 - -------------------------------------------------------------------------------- CHASE VISTA FEDERAL MONEY MARKET FUND Portfolio of Investments - -------------------------------------------------------------------------------- As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - -------------------------------------------------------------------------------- Money Market Instruments -- 99.7% - -------------------------------------------------------------------------------- U.S. Government Agency Securities -- 99.7% ------------------------------------------ Federal Farm Credit Bank -- 9.6% Federal Farm Credit Bank, $ 8,439 DN, 5.89%, 10/26/00 $ 8,367 1,561 DN, 5.91%, 10/26/00 1,548 100,000 FRN, 6.44%, 05/01/01 99,967 ---------- 109,882 Federal Home Loan Bank -- 85.7% Federal Home Loan Bank, 25,000 6.75%, 03/01/01 25,000 15,500 6.76%, 03/13/01 15,500 20,000 DN, 5.89%, 10/27/00 19,827 8,000 DN, 5.91%, 10/06/00 7,957 15,000 DN, 5.93%, 11/24/00 14,804 20,000 DN, 6.03%, 12/08/00 19,690 25,000 DN, 6.13%, 12/22/00 24,550 15,000 DN, 6.32%, 01/08/01 14,680 37,319 DN, 6.44%, 09/15/00 37,225 100,000 DN, 6.50%, 09/27/00 99,533 25,000 DN, 6.50%, 02/01/01 24,352 3,821 DN, 6.51%, 09/01/00 3,821 75,000 DN, 6.51%, 09/27/00 74,649 25,000 DN, 6.51%, 03/15/01 24,172 16,844 DN, 6.54%, 01/16/01 16,436 45,000 DN, 6.55%, 01/16/01 43,911 25,000 DN, 6.55%, 04/09/01 24,060 92,429 DN, 6.56%, 09/15/00 92,198 25,000 DN, 6.57%, 04/20/01 24,010 75,000 DN, 6.61%, 02/28/01 72,600 75,000 FRN, MTN, 6.46%, 03/20/01 74,976 50,000 FRN, 6.48%, 07/18/01 49,969 50,000 FRN, 6.55%, 10/10/00 49,995 75,000 FRN, 6.61%, 09/22/00 74,999 50,000 FRN, 6.72%, 05/10/01 49,983 ---------- 978,897 Student Loan Marketing Association -- 4.4% 50,000 Student Loan Marketing Association, FRN, 6.57%, 10/19/00 50,000 - -------------------------------------------------------------------------------- Total Investments -- 99.7% $1,138,779 (Cost $1,138,779)* - --------------------------------------------------------------------------------
See notes to financial statements. 15 - -------------------------------------------------------------------------------- CHASE VISTA CASH MANAGEMENT FUND Portfolio of Investments - -------------------------------------------------------------------------------- As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - --------------------------------------------------------------------------------------- Money Market Instruments -- 99.5% - --------------------------------------------------------------------------------------- U.S. Government Agency Securities -- 2.3% ----------------------------------------- Federal Home Loan Bank, $ 35,000 DN, 5.93%, 11/24/00 $ 34,543 93,900 DN, 5.93%, 12/01/00 92,571 25,000 DN, 6.50%, 02/01/01 24,352 50,000 DN, 6.51%, 03/15/01 48,344 17,798 DN, 6.55%, 04/09/01 17,129 35,000 DN, 6.57%, 04/20/01 33,614 --------------------------------------------------------------------- Total U.S. Government Agency Securities 250,553 (Cost $250,553) --------------------------------------------------------------------- State and Municipal Obligations -- 1.3% --------------------------------------- California -- 1.0% 60,610 California Housing Finance Agency, Home Mortgage, Ser. M, Rev. FRDO, 6.58%, 09/04/00 60,610 20,000 California Pollution Control Financing Authority, Environmental Improvement, Shell Oil Co., Project B, Rev. FRDO, 6.57%, 09/06/00 20,000 22,000 Sacramento County, California, Rev. FRDO, 6.55%, 09/04/00 22,000 ------- 102,610 Missouri -- 0.1% 16,200 SSM Healthcare, Missouri Health Facilities, Ser. E, Rev. FRDO, 6.62%, 09/05/00 16,200 Texas -- 0.2% 27,500 Texas State, Veterans Housing Assistance, Ser. A-2, GO, FRDO, 6.60%, 09/04/00 27,500 --------------------------------------------------------------------- Total State and Municipal Obligations 146,310 (Cost $146,310) --------------------------------------------------------------------- Corporate Notes & Bonds -- 59.8% -------------------------------- Asset Backed Securities -- 13.3% Asset Backed Capital Finance, Inc., 100,000 MTN, FRN, #, 6.63%, 05/25/01 99,993 50,000 MTN, FRN, #, 6.63%, 06/18/01 50,000 70,000 MTN, FRN, #, 6.64%, 06/19/01 70,000 110,000 Asset Securitization Cooperative Corp. (ASCC), FRN, 6.57%, 01/12/01 109,981 134,427 Associates Manufactured Housing Corp., Ser. 1999-1, Class A, Putable, FRN, #, 6.85%, 10/15/00 134,443 125,000 Beta Finance Corp., Inc., (Channel Islands), MTN, FRN, #, 6.60%, 05/08/01 125,000 CC USA, Inc., (Centauri Corp.), 50,000 MTN, #, 7.07%, 07/25/01 50,000 75,000 MTN, #, 7.48%, 06/07/01 75,000 75,000 Compass Securitization LLC, FRN, 6.59%, 10/16/00 74,999 130,000 Lexington Parker Capital, FRN, 6.63%, 01/25/01 129,994 Liberty Lighthouse U.S. Capital Co., 120,000 MTN, FRN, #, 6.68%, 03/05/01 120,000 65,000 MTN, FRN, #, 6.83%, 11/06/00 65,000 100,000 Strategic Money Market (SMM), Trust 2000-B, FRN, #, 6.81%, 12/13/00 100,000
See notes to financial statements. 16 CHASE VISTA CASH MANAGEMENT FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - --------------------------------------------------------------------------------------- Money Market Instruments -- Continued - --------------------------------------------------------------------------------------- Asset Backed Securities -- Continued $ 100,000 Special Purpose Accounts Receivable Cooperative Corp., FRN, 6.62%, 01/05/01 $ 100,000 75,000 Structured Products Asset Return Certificates, Ser. 1998-1, FRN, #, 6.73%, 11/27/00 75,000 100,000 Variable Funding Capital Corp., FRN, 6.60%, 02/05/01 99,992 ---------- 1,479,402 Automotive -- 8.0% American Honda Finance Corp., 100,000 MTN, FRN, #, 6.61%, 02/06/01 99,990 60,000 MTN, FRN, #, 6.77%, 06/19/01 60,000 200,000 Daimler Chrysler North America Holding Corp., MTN, FRN, 6.56%, 02/22/01 199,928 Ford Motor Credit Co., 75,000 MTN, FRN, 6.77%, 10/02/00 74,994 27,000 MTN, FRN, 7.10%, 09/25/00 27,005 General Motors Acceptance Corp., 250,000 MTN, FRN, 6.72%, 12/14/00 249,938 30,000 MTN, FRN, 6.83%, 04/30/01 30,025 140,000 Toyota Motor Credit Corp., MTN, FRN, 6.81%, 10/12/00 140,000 ---------- 881,880 Banking -- 12.8% 100,000 Abbey National Treasury Services PLC, (United Kingdom), (Yankee), MTN, FRN, 6.52%, 06/15/01 99,939 American Express Centurion Bank, 100,000 FRN, 6.58%, 02/28/01 100,000 50,000 MTN, FRN, 6.58%, 04/12/01 49,997 100,000 MTN, FRN, 6.59%, 05/08/01 100,000 55,000 Bank One Corp., FRN, 6.71%, 11/17/00 54,995 Commerzbank AG (Germany), (Yankee), 165,000 FRN, 6.54%, 03/19/01 164,956 200,000 FRN, 6.57%, 04/26/01 199,960 100,000 Credit Suisse First Boston Inc. (Switzerland), MTN, FRN, 6.59%, 05/09/01 99,993 75,000 Credit Suisse First Boston International, (Switzerland), FRN, #, 6.78%, 10/02/00 75,003 240,000 Dresdner Bank AG, (Germany), FRN, 6.55%, 03/28/01 239,946 Fleet National Bank, 100,000 FRN, 6.71%, 10/26/00 99,994 85,000 MTN, FRN, 6.77%, 05/24/01 85,060 50,000 National City Bank, MTN, FRN, 6.76%, 07/05/01 49,981 ---------- 1,419,824 Consumer Products -- 0.7% 75,000 Unilever Capital Corp., FRN, 6.65%, 09/07/01 75,000 Financial Services -- 15.2% 100,000 Associates Corp. of North America, SUB, FRN, 6.77%, 06/15/04 100,000 Bear Stearns Companies, Inc., 200,000 Ser. B, MTN, FRN, 6.68%, 02/23/01 199,999 85,000 FRN, 6.96%, 08/01/01 85,142
See notes to financial statements. 17 CHASE VISTA CASH MANAGEMENT FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - -------------------------------------------------------------------------------- Money Market Instruments -- Continued - -------------------------------------------------------------------------------- Financial Services -- Continued CIT Group, Inc., $ 80,000 MTN, FRN, 6.80%, 09/15/00 $ 79,998 30,000 MTN, FRN, 7.02%, 11/13/00 30,017 100,000 Citigroup Inc., MTN, FRN, 6.59%, 06/06/01 100,000 Goldman Sachs Group, Inc., 148,000 FRN, #, 6.86%, 05/15/01 148,000 30,000 MTN, FRN, 6.85%, 09/07/00 30,000 J.P. Morgan & Co., Inc., 63,000 FRN, 6.61%, 03/16/01 63,000 40,000 FRN, 6.74%, 06/18/01 40,041 60,000 FRN, 6.77%, 06/25/01 60,057 Merrill Lynch & Co., Inc., 200,000 MTN, FRN, 6.58%, 03/06/01 199,989 20,000 MTN, FRN, 6.82%, 09/25/00 20,000 Morgan Stanley Dean Witter & Co., 110,000 FRN, 6.64%, 08/15/01 110,000 150,000 MTN, FRN, 6.60%, 03/16/01 150,000 50,000 MTN, FRN, 6.86%, 01/22/01 50,030 25,000 MTN, FRN, 6.91%, 03/15/01 25,000 130,000 Wells Fargo & Co., FRN, 6.59%, 09/14/01 130,000 75,000 Westpac Banking Corp., (Australia), (Yankee), FRN, 6.73%, 05/08/01 75,019 ---------- 1,696,292 Insurance -- 0.7% Prudential Funding Corp., 30,000 FRN, 6.70%, 12/21/00 29,994 50,000 MTN, FRN, 6.81%, 04/17/01 50,020 ---------- 80,014 Machinery & Engineering Equipment -- 0.7% 75,000 Caterpillar Financial Services Corp., MTN, FRN, 6.80%, 07/09/01 75,000 Real Estate -- 0.8% 84,000 Main Place Real Estate Investment Corp., FRN, 6.89%, 10/25/00 84,008 Telecommunications -- 5.4% 30,000 AT&T Capital Corp., MTN, FRN, 7.45%, 12/01/00 30,047 AT&T Corp., 100,000 FRN, #, 6.56%, 03/08/01 99,990 265,000 FRN, #, 6.65%, 07/19/01 265,001 200,000 SBC Communications, Inc., FRN, #, 6.63%, 05/15/01 199,972 ---------- 595,010 Utilities -- 2.2% 55,292 Baltimore Gas & Electric Co., FRN, 6.84%, 09/01/06 55,294 190,000 National Rural Utilities Co., Ser. C., MTN, FRN, 6.81%, 09/08/00 190,000 ---------- 245,294 ---------------------------------------------------------------- Total Corporate Notes & Bonds 6,631,724 (Cost $6,631,724) ------------------------------------------------------------------
See notes to financial statements. 18 CHASE VISTA CASH MANAGEMENT FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - ----------------------------------------------------------------------------------- Money Market Instruments -- Continued - ----------------------------------------------------------------------------------- Commercial Paper -- 18.3% ------------------------- Asset Backed Securities -- 10.5% $ 50,000 Amstel Funding Corp., 6.56%, 09/18/00 $ 49,846 60,000 Atlantis One Funding, 6.75%, 02/14/01 58,193 50,000 Bills Securitization LTD, 6.93%, 11/03/00 49,414 Concord Minutemen Capital Co., LLC, Series A, 41,324 6.57%, 09/14/00 41,226 92,000 6.58%, 09/07/00 91,900 Crown Point Capital Co., LLC, 73,000 6.64%, 09/14/00 72,827 27,000 6.64%, 11/16/00 26,627 Falcon Asset Securitization Corp., 75,000 6.59%, 09/14/00 74,823 48,000 6.59%, 09/20/00 47,835 42,000 Greenwich Funding Corp., 6.56%, 09/15/00 41,894 75,000 Greyhawk Funding LLC, 6.77%, 02/02/01 72,899 50,000 Intrepid Funding Master Trust, Ser. 1999-A, 6.28%, 09/05/00 49,966 27,000 Lexington Parker Capital Corp., LLC, 6.73%, 09/12/00 26,945 65,000 Montauk Funding Corp., 6.57%, 09/26/00 64,706 Moriarty LLC, 75,000 6.75%, 02/27/01 72,565 85,000 6.85%, 02/02/01 82,593 25,544 Parthenon Receivables Funding LLC, 6.87%, 01/25/01 24,856 41,149 Pooled Accounts Receivable Capital Corp., 6.56%, 09/18/00 41,022 100,000 Sheffield Receivables Corp., #, 6.56%, 09/15/00 99,746 75,000 Tulip Funding Corp., 6.62%, 09/20/00 74,741 ---------- 1,164,624 Banking -- 2.8% 100,000 Bank of America, NA, 6.30%, 09/12/00 99,814 90,000 Credit Suisse First Boston Inc., 6.32%, 09/13/00 89,816 125,000 United Mexican States, 7.02%, 11/03/00 123,508 ---------- 313,138 Financial Services -- 3.5% 102,000 Aspen Funding Corp., 6.35%, 09/18/00 101,703 100,000 Citibank Capital Markets Assets, LLC, 6.86%, 02/06/01 97,095 75,000 Girsa Funding Corp., 6.55%, 10/23/00 74,313 100,000 Goldman Sachs Group, Inc., 6.75%, 02/14/01 96,994 20,000 Interperu Funding Ltd., 6.88%, 11/08/00 19,749 ---------- 389,854 Telecommunications -- 0.7% British Telecommunications PLC, 25,000 6.28%, 09/07/00 24,975 50,000 6.85%, 11/06/00 49,393 ---------- 74,368 Utilities -- 0.8% 87,000 Comision Federal De Electricidad, (Mexico), 6.58%, 09/18/00 86,732 ------------------------------------------------------------------- Total Commercial Paper 2,028,716 (Cost $2,028,716) -------------------------------------------------------------------
See notes to financial statements. 19 CHASE VISTA CASH MANAGEMENT FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - --------------------------------------------------------------------------------------- Money Market Instruments -- Continued - --------------------------------------------------------------------------------------- Funding Agreements/GICS -- 6.4% ------------------------------- $ 50,000 AIG Funding Inc., Floating Rate, 6.81%, 10/02/00 $ 50,000 125,000 First Allmerica Financial Life Insurance Co., Floating Rate, 6.82%, 04/06/01 125,000 150,000 G E Financial Assurance, Floating Rate, 6.91%, 03/01/01 150,000 Jackson National Life Insurance Co., Floating Rate, 100,000 6.86%, 01/18/01 100,000 80,000 6.91%, 09/01/01 80,000 100,000 MetLife Funding Inc., Floating Rate, #, 6.91%, 06/01/01 100,000 50,000 Travelers Insurance Co., Floating Rate, 6.80%, 04/24/01 50,000 50,000 United of Omaha Life Insurance Company, Floating Rate, 6.71%, 05/17/01 50,000 ----------------------------------------------------------------------- Total Funding Agreements/GICS 705,000 (Cost $705,000) ----------------------------------------------------------------------- Certificates of Deposit -- 10.1% -------------------------------- 150,000 Banco Santander Central Hispano SA, (Spain), (Yankee), 6.73%, 02/28/01 149,998 Bank Austria AG (Austria), (Yankee), 50,000 6.55%, 02/01/01 49,990 50,000 6.71%, 02/05/01 49,990 190,000 Bayerische Hypo- und Vereinsbank AG, Floating Rate, (Germany), (Yankee), 6.54%, 02/28/01 189,955 130,000 Bayerische Landesbank Girozentrale, Floating Rate, (Germany), (Yankee), 6.54%, 12/15/00 129,972 90,000 Commerzbank AG (Germany), (Yankee), 6.52%, 01/08/01 89,991 75,000 Deutsche Bank AG, (Germany), (Yankee), 6.73%, 03/16/01 74,977 55,000 Landesbank Hessen-Thuringen Girozentrale, (Germany), (Yankee), 6.89%, 04/30/01 54,995 50,000 Norddeutsche Landesbank Girozentrale, (Germany), (Yankee), 6.55%, 01/16/01 49,991 75,000 Rabobank Nederland NV (Netherlands), (Yankee), 6.50%, 01/29/01 74,985 50,000 Svenska Handelsbanken, Inc., (Sweden), (Yankee), 6.75%, 02/14/01 49,989 150,000 Westdeutsche Landesbank Girozentrale, (Germany), (Yankee), 6.75%, 08/28/01 150,000 ----------------------------------------------------------------------- Total Certificates of Deposit 1,114,833 (Cost $1,114,833) ----------------------------------------------------------------------- Time Deposit -- 1.3% -------------------- 145,902 Wachovia Bank, 6.56%, 09/01/00 145,902 (Cost $145,902) - --------------------------------------------------------------------------------------- Total Investments -- 99.5% $11,023,038 (Cost $11,023,038)* - ---------------------------------------------------------------------------------------
See notes to financial statements. 20 - -------------------------------------------------------------------------------- CHASE VISTA PRIME MONEY MARKET FUND Portfolio of Investments - -------------------------------------------------------------------------------- As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - ------------------------------------------------------------------------------------------ Money Market Instruments -- 102.2% - ------------------------------------------------------------------------------------------ U.S. Government Agency Securities -- 1.8% ----------------------------------------- Federal Home Loan Bank, $ 35,000 DN, 5.85%, 11/17/00 $ 34,586 50,000 DN, 5.93%, 11/24/00 49,347 55,000 DN, 6.03%, 12/08/00 54,148 15,000 DN, 6.13%, 12/22/00 14,730 25,000 DN, 6.32%, 01/08/01 24,467 25,000 DN, 6.50%, 02/01/01 24,352 25,000 DN, 6.51%, 03/15/01 24,172 ------------------------------------------------------------------------ Total U.S. Government Agency Securities 225,802 (Cost $225,802) ------------------------------------------------------------------------ State and Municipal Obligation -- 0.0% -------------------------------------- 4,346 Sault Sainte Marie, Michigan, Tribe Building Authority, Taxable, Rev., FRDO, 7.51%, 12/01/00 4,346 (Cost $4,346) ------------------------------------------------------------------------ Corporate Notes & Bonds -- 39.4% -------------------------------- Asset Backed Securities -- 19.0% 47,000 ACE Overseas Corp., FRN, 6.74%, 03/16/01 46,991 Beta Finance Corp., Inc., (Channel Islands), 75,000 FRN, #, 6.61%, 08/14/01 74,996 65,000 MTN, #, 6.87%, 02/26/01 65,000 30,000 MTN, #, 6.90%, 03/30/01 29,999 85,000 MTN, #, 6.94%, 05/02/01 85,000 50,000 MTN, FRN, #, 6.11%, 03/30/01 49,997 50,000 MTN, FRN, #, 6.60%, 04/30/01 50,000 CC USA, Inc. (Centauri Corp.), 60,000 MTN, #, 6.10%, 09/07/00 60,000 35,000 MTN, #, 7.12%, 05/07/01 35,000 50,000 MTN, #, 7.07%, 07/25/01 50,000 50,000 MTN, FRN, #, 6.60%, 04/20/01 50,000 50,000 MTN, FRN, #, +, 6.84%, 09/10/01 50,000 100,000 Compass Securitization LLC, FRN, 6.59%, 10/16/00 99,998 Dorada Finance Inc., 70,000 MTN, #, 7.06%, 07/17/01 70,000 75,000 MTN, FRN, #, 6.87%, 09/05/00 75,000 75,000 MTN, FRN, #, +, 6.84%, 09/10/01 75,000 26,481 First Security Auto Owner Trust 2000-1, Class A-1, 6.77%, 07/16/01 26,481 K2 (USA) LLC, 55,000 MTN, FRN, #, 6.62%, 07/16/01 55,000 100,000 MTN, FRN, #, 6.62%, 08/15/01 100,000 50,000 MTN, FRN, #, 6.80%, 10/16/00 50,000 75,000 Links Finance LLC, MTN, FRN, #, 6.60%, 05/11/01 74,992 Restructured Asset Securities with Enhanced Returns (RACERS), 37,000 1999 Ser. MM-35, FRN, #, 6.72%, 12/15/00 37,000 90,000 2000 Ser. MM-7, FRN, #, 6.64%, 05/30/01 89,963 100,000 2000 Ser. MM-10, FRN, #, 6.64%, 06/22/01 100,000 Sigma Finance Corp., (Channel Islands), 100,000 MTN, FRN, #, 6.60%, 05/02/01 100,000 75,000 MTN, FRN, #, 6.61%, 03/05/01 75,000
See notes to financial statements. 21 - -------------------------------------------------------------------------------- CHASE VISTA PRIME MONEY MARKET FUND Portfolio of Investments (Continued) - -------------------------------------------------------------------------------- As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - ---------------------------------------------------------------------------------------- Money Market Instruments -- Continued - ---------------------------------------------------------------------------------------- Asset Backed Securities -- Continued $ 100,000 MTN, FRN, #, 6.62%, 05/15/01 $ 100,000 50,000 MTN, FRN, #, 6.67%, 09/25/01 50,012 50,000 MTN, FRN, #, 6.80%, 10/16/00 50,000 70,000 MTN, FRN, #, 6.90%, 09/15/00 70,000 Strategic Money Market (SMM), 75,000 Trust 2000-B, FRN, #, 6.81%, 12/13/00 75,000 60,000 Trust 2000-E, FRN, #, 6.64%, 03/14/01 60,000 136,957 Trust 2000-G, FRN, #, 6.89%, 06/04/01 136,958 100,000 Special Purpose Accounts Receivable Cooperative Corp., FRN, 6.62%, 02/26/01 100,000 100,000 Variable Funding Capital Corp., FRN, 6.60%, 02/05/01 99,992 ---------- 2,417,379 Automotive -- 1.3% Toyota Motor Credit Corp., 150,000 MTN, FRN, @, 6.68%, 04/23/01 149,964 20,000 MTN, FRN, 6.87%, 10/25/00 20,003 ---------- 169,967 Banking -- 6.3% 250,000 Abbey National Treasury Services PLC, (United Kingdom), (Yankee), MTN, FRN, 6.52%, 06/15/01 249,846 100,000 American Express Centurion Bank, MTN, FRN, 6.59%, 05/08/01 100,000 70,000 Bank of America, N.A., MTN, FRN, 6.78%, 07/11/01 70,006 100,000 Bank One N.A., FRN, 6.65%, 09/10/01 100,025 Commerzbank AG (Germany), (Yankee), 75,000 FRN, 6.54%, 03/19/01 74,980 160,000 FRN, 6.58%, 06/29/01 159,921 50,000 Landesbank Hessen-Thuringen Girozentrale, (Germany), (Yankee), FRN, 6.77%, 10/02/00 49,994 ---------- 804,772 Consumer Products -- 0.6% 75,000 Unilever Capital Corp., FRN, 6.65%, 09/07/01 75,000 Financial Services -- 9.8% 75,000 Associates Corp. of North America, FRN, 6.77%, 06/26/01 75,000 Citigroup, Inc., 175,000 MTN, FRN, 6.58%, 04/04/01 175,000 150,000 MTN, FRN, 6.59%, 06/06/01 150,000 90,000 Goldman Sachs Group LP, Ser. A, MTN, FRN, #, 6.81%, 09/12/01 90,000 150,000 Merrill Lynch & Co., Inc., MTN, FRN, 6.58%, 03/06/01 149,992 Morgan Stanley Dean Witter & Co., 150,000 FRN, 6.64%, 08/15/05 150,000 55,000 MTN, FRN, 6.69%, 05/15/01 55,002 35,000 MTN, FRN, 6.90%, 03/13/01 35,000 50,000 MTN, FRN, 6.91%, 03/15/01 50,000 Wells Fargo Bank, N.A., 150,000 FRN, 6.59%, 09/14/01 150,000 175,000 MTN, FRN, 6.76%, 07/24/01 174,939 ---------- 1,254,933
See notes to financial statements. 22 CHASE VISTA PRIME MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - --------------------------------------------------------------------------------- Money Market Instruments -- Continued - --------------------------------------------------------------------------------- Telecommunications -- 2.4% $ 150,000 AT&T Corp., FRN, #, 6.56%, 03/08/01 $ 149,985 150,000 SBC Communications, Inc., FRN, #, 6.63%, 05/15/01 149,979 ---------- 299,964 ---------------------------------------------------------------- Total Corporate Notes & Bonds 5,022,015 (Cost $5,022,015) ---------------------------------------------------------------- Commercial Paper -- 39.8% ------------------------- Asset Backed Securities -- 24.4% Alpine Securitization Corp., 54,000 6.55%, 09/19/00 53,824 135,000 6.56%, 09/18/00 134,583 34,396 6.62%, 09/18/00 34,290 100,000 Atlantis One Funding Corp., 6.75%, 02/14/01 96,989 Barton Capital Corp., 77,110 6.55%, 09/22/00 76,817 40,434 6.58%, 09/06/00 40,397 50,000 Bills Securitization Ltd., 6.93%, 11/03/00 49,414 85,000 Bavaria Universal Funding Co., Floating Rate, 6.60%, 02/13/01 84,994 70,000 Blue Ridge Asset Funding Corp., 6.57%, 09/06/00 69,937 115,000 Brahms Funding Corp., 6.62%, 10/18/00 113,688 Charta Corp., 45,000 6.59%, 09/08/00 44,943 50,000 6.62%, 09/07/00 49,945 Falcon Asset Securitization Corp., 75,000 6.56%, 09/27/00 74,647 75,000 6.59%, 09/14/00 74,823 Four Winds Funding Corp., 54,000 #, 6.55%, 09/08/00 53,932 102,600 6.55%, 09/18/00 102,284 100,000 Galaxy Funding Inc., 6.89%, 02/02/01 97,155 Grand Funding Corp., 65,000 6.55%, 09/06/00 64,941 41,200 6.57%, 09/18/00 41,073 150,000 Greenwich Funding Corp., 6.56%, 09/15/00 149,619 75,000 Greyhawk Funding LLC, 6.77%, 02/02/01 72,899 International Securitization Corp., 48,000 6.56%, 09/15/00 47,878 78,465 6.56%, 09/29/00 78,066 75,000 Intrepid Funding Master Trust, Ser. 1999-A, 6.28%, 09/05/00 74,949 K2 (USA) LLC, 24,000 6.87%, 02/26/01 23,217 50,000 6.94%, 04/17/01 47,910 Liberty Street Funding Corp., 37,945 6.74%, 09/06/00 37,910 60,000 6.75%, 09/07/00 59,934 99,740 Market Street Funding Corp., #, 6.76%, 09/07/00 99,630 72,790 Old Line Funding Corp., #, 6.60%, 09/20/00 72,539 42,000 Parthenon Receivables Funding LLC, 6.57%, 09/18/00 41,870 61,955 Pooled Accounts Receivable Capital Corp., 6.15%, 09/12/00 61,832
See notes to financial statements. 23 CHASE VISTA PRIME MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - ------------------------------------------------------------------------------------- Money Market Instruments -- Continued - ------------------------------------------------------------------------------------- Asset Backed Securities -- Continued $ 65,539 Receivables Capital Corp., #, 6.58%, 09/11/00 $ 65,420 Sheffield Receivables Corp., 100,000 6.56%, 09/01/00 100,000 100,000 6.56%, 09/15/00 99,746 49,400 6.57%, 09/20/00 49,230 65,000 Sigma Finance Corp., (Channel Islands), #, 6.74%, 02/28/01 62,881 Silver Tower U.S. Funding, LLC, 95,000 6.74%, 02/23/01 91,989 50,000 6.75%, 02/12/01 48,515 75,000 Surrey Funding Corp., 6.56%, 09/14/00 74,823 65,411 Thames Asset Global Securitization (TAGS), #, 6.76%, 09/29/00 65,073 82,398 Tulip Funding Corp., 6.62%, 09/20/00 82,114 68,000 Victory Receivables, 6.55%, 09/19/00 67,778 50,000 WCP Funding, Inc., 6.58%, 09/07/00 49,946 ---------- 3,084,444 Automotive -- 2.4% Daimler Chrysler North America Holding Corp., 100,000 6.57%, 09/25/00 99,565 156,950 6.58%, 09/27/00 156,210 50,000 6.63%, 11/22/00 49,257 ---------- 305,032 Banking -- 3.5% 54,800 Banco de Galicia y Buenos Aires SA de CV, (Argentina), 6.63%, 09/22/00 54,591 20,000 Banco Rio De La Plata SA, (Argentina), 6.78%, 03/08/01 19,317 100,000 Banco Santander, (Puerto Rico), 6.63%, 09/12/00 99,800 150,000 Bank of America, N.A., 6.30%, 09/12/00 149,719 Banque ET Caisse DEpargne De L'Etat (France), 51,000 6.68%, 12/27/00 49,923 75,000 6.76%, 02/16/01 72,715 ---------- 446,065 Financial Services -- 6.4% 102,000 Aspen Funding Corp., 6.35%, 09/18/00 101,704 70,000 Associates Corp. of North America, ECN, 6.63%, 09/25/00 69,694 70,000 Citibank Capital Markets Assets, LLC, 6.86%, 02/07/01 67,953 Dakota Certificate Program (Citibank Credit Card Master Trust I), 91,894 6.62%, 09/26/00 91,477 60,000 6.63%, 09/14/00 59,858 Fairway Finance Corp., 70,259 6.56%, 09/25/00 69,954 40,941 6.77%, 02/23/01 39,639 112,917 HomeSide Lending Inc., 6.65%, 09/27/00 112,383 30,000 Interperu Funding Ltd., 6.54%, 09/27/00 29,863 100,000 New Castle Certificate Program (Discover Card Master Trust I, Ser. 2000-A), ECN, 6.70%, 09/18/00 99,687 110,000 Quincy Capital Corp., 6.56%, 09/25/00 109,522 ---------- 851,734
See notes to financial statements. 24 CHASE VISTA PRIME MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - --------------------------------------------------------------------------------- Money Market Instruments -- Continued - --------------------------------------------------------------------------------- Food/Beverage Products -- 1.0% Coca-Cola Co., $ 50,000 ECN, 6.61%, 09/18/00 $ 49,846 75,000 ECN, 6.64%, 11/14/00 73,993 ---------- 123,839 Telecommunications -- 1.5% British Telecommunications PLC, 50,000 6.65%, 11/06/00 49,393 144,500 6.74%, 02/15/01 140,130 ---------- 189,523 Utilities -- 0.6% Comision Federal De Electricidad, (Mexico), 50,000 6.58%, 09/18/00 49,846 31,000 6.60%, 09/18/00 30,904 ---------- 80,750 ----------------------------------------------------------------- Total Commercial Paper 5,081,387 (Cost $5,081,387) ----------------------------------------------------------------- Certificates of Deposit -- 12.9% -------------------------------- 110,000 Banco Popolare di Milano (Italy), (Yankee), 6.64%, 11/15/00 110,005 Bank Austria AG (Austria), (Yankee), 50,000 6.55%, 02/01/01 49,990 59,000 6.71%, 02/05/01 58,988 Bayerische Landesbank Girozentrale, Floating Rate, (Germany), (Yankee), 135,000 6.54%, 12/15/00 134,971 190,000 6.54%, 03/01/01 189,954 Credit Communal De Belgique S.A., (Belgium), 25,000 5.96%, 10/02/00 24,997 100,000 Floating Rate, 6.54%, 03/01/01 99,976 75,000 Deutsche Bank AG, (Germany), (Yankee), 6.73%, 03/16/01 74,977 Landesbank Baden-Wuerttemberg, (Germany), (Yankee), 75,000 6.72%, 02/28/01 74,997 100,000 6.73%, 02/15/01 100,000 55,000 Landesbank Hessen-Thuringen Girozentrale, (Germany), 6.89%, 04/30/01 54,995 Norddeutsche Landesbank Girozentrale, (Germany), (Yankee), 50,000 6.55%, 01/16/01 49,991 125,000 6.72%, 02/28/01 124,992 75,000 Rabobank Nederland NV (Netherlands), (Yankee), 6.50%, 01/29/01 74,985 68,000 Svenska Handelsbanken, Inc., (Sweden), (Yankee), 6.75%, 02/14/01 67,985 100,000 UBS Finance Inc., (Switzerland), (Yankee), 6.50%, 01/08/01 99,983 260,000 Westdeutsche Landesbank Girozentrale, (Germany), (Yankee), Floating Rate, 6.54%, 02/28/01 259,937 ----------------------------------------------------------------- Total Certificates of Deposit 1,651,723 (Cost $1,651,723) -----------------------------------------------------------------
See notes to financial statements. 25 CHASE VISTA PRIME MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount (USD) Issuer Value - ------------------------------------------------------------------------------------------ Money Market Instruments -- Continued - ------------------------------------------------------------------------------------------ Time Deposits -- 4.7% --------------------- $ 295,000 Firstar Bank, 6.59%, 09/01/00 $ 295,000 308,864 Key Bank N.A., 6.56%, 09/01/00 308,864 ------------------------------------------------------------------------- Total Time Deposits 603,864 (Cost $603,864) ------------------------------------------------------------------------- Repurchase Agreements -- 3.6% ----------------------------- 255,000 Credit Suisse First Boston, Tri Party, 6.66%, due 09/01/00 (Dated 08/31/00, Proceeds $255,047, Secured by U.S. Government Agency Obligations, $260,471, 5.20% through 8.47%, due 09/01/00 through 02/24/10; Market Value $260,783) 255,000 200,000 Salomon Smith Barney, Tri Party, 6.66%, due 09/01/00 (Dated 08/31/00, Proceeds $200,037, Secured by U.S. Government Agency Obligations, $205,665, DN, due 09/22/00 through 03/01/01; Market Value $204,000) 200,000 ------------------------------------------------------------------------- Total Repurchase Agreements 455,000 (Cost $455,000) - ------------------------------------------------------------------------------------------ Total Investments -- 102.2% $13,044,137 (Cost $13,044,137)* - ------------------------------------------------------------------------------------------
See notes to financial statements. 26 - -------------------------------------------------------------------------------- CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments - -------------------------------------------------------------------------------- As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Money Market Instruments -- 100.2% - ------------------------------------------------------------------------------------- U.S. Government Agency Securities -- 0.5% ----------------------------------------- Federal Home Loan Bank -- 0.0% $ 601 Federal Home Loan Bank, DN, 6.53%, 09/07/00 $ 601 Federal Home Loan Mortgage Corp. -- 0.5% 6,853 Federal Home Loan Mortgage Corp., DN, 6.53%, 09/07/00 6,853 --------------------------------------------------------------------- Total U.S. Government Agency Securities 7,454 (Cost $7,454) --------------------------------------------------------------------- Municipal Securities -- 99.7% ----------------------------- Alabama -- 2.3% 3,820 Alabama State, Public School & College Authority, Ser. 124, PUTTERS, FRDO, 4.32%, 09/07/00 3,820 5,000 Birmingham, Alabama, GO, FRDO, 4.25%, 09/07/00 5,000 3,450 Birmingham, Alabama, Ser. A, Warrants, FRDO, 4.25%, 09/07/00 3,450 5,000 DCH Health Care Authority, Alabama, Health Care Facilities, Rev., FRDO, 4.25%, 09/07/00 5,000 3,000 Infirmary Health Systems, Special Care Facilities Financing Authority, Mobile, Alabama, Infirmary Health Systems Inc., Ser. A, Rev., FRDO, 4.25%, 09/07/00 3,000 1,195 Marshall County, Alabama, Special Obligation, Warrants, FRDO, 4.30%, 09/07/00 1,195 1,000 Phenix County, Alabama, Industrial Development Board, Environmental Improvement, Mead Coated Board Project, Ser. A, Rev., FRDO, 4.45%, 09/01/00 1,000 8,700 Stevenson, Alabama, Industrial Development Board, Environmental Improvement, The Mead Corp. Project, Rev., FRDO, 4.35%, 09/01/00 8,700 4,900 Stevenson, Alabama, Industrial Development Board, Environmental Improvement, The Mead Corp. Project, Ser. C, Rev., FRDO, 4.35%, 09/01/00 4,900 1,900 University of Alabama, Hospital, Ser. B, Rev., FRDO, 4.25%, 09/06/00 1,900 ------- 37,965 Alaska -- 0.9% 7,875 Alaska State, Housing Finance Corp., Floating Rate Trusts Receipts, Ser. N-13, Regulation D, Rev., FRDO, 4.50%, 09/06/00 7,875 6,845 Alaska State, Housing Finance Corp., FLOATS, Ser. PT-202, Rev., FRDO, 5.92%, 09/01/00 6,848 ------- 14,723 Arizona -- 0.3% 5,000 University of Arizona, Main Campus & Research, Ser. A, Rev., COP, FRDO, 4.20%, 09/06/00 5,000 Arkansas -- 0.8% 3,600 Arkansas Hospital Equipment Finance Authority, AHA Pooled Financing Program, Rev., FRDO, 4.35%, 09/06/00 3,600 3,750 Arkansas State, Development Finance Authority, IDR, Stratton Seed Co. Project, Rev., FRDO, 4.45%, 09/07/00 3,750
See notes to financial statements. 27 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ----------------------------------------------------------------------------------- Money Market Instruments -- Continued - ----------------------------------------------------------------------------------- Arkansas -- Continued $ 5,500 Columbia County, Arkansas, Solid Waste Disposal, Albemarle Corp. Project, Rev., FRDO, 4.45%, 09/07/00 $ 5,500 ------- 12,850 California -- 0.1% 500 Alameda County, California, Multi-Family Housing, Quail, Ser. A, Rev., FRDO, 3.50%, 09/06/00 500 900 San Diego, California, IDR, Kaiser Aerospace & Electric, Ser. A, Rev., FRDO, 3.85%, 09/07/00 900 ------- 1,400 Colorado -- 2.0% 15,400 Colorado Springs, Colorado, Utilities, Municipal Securities Trust Receipts, Ser. SGA-88, Rev., FRDO, 4.35%, 09/01/00 15,400 2,500 Colorado Student Obligation Bond Authority, Student Loan, Senior Lien, Ser. A-3, Rev., FRDO, 4.35%, 09/06/00 2,500 15,580 Denver, Colorado, City & County Airport, Floating Rate Certificates, Ser. 153, Rev., FRDO, 4.33%, 09/07/00 15,580 ------- 33,480 Connecticut -- 0.9% 15,100 Meriden, Connecticut, GO, BAN, 4.75%, 08/08/01 15,139 Delaware -- 0.6% 9,400 Delaware State, Economic Development Authority, IDR, Star Enterprise Project, Ser. B, Rev., FRDO, 4.35%, 09/06/00 9,400 District of Columbia -- 3.8% 19,400 District of Columbia, Rev., FRDO, 4.30%, 11/16/00 19,400 4,755 District of Columbia, Water & Sewer Authority, Public Utility, Rev., FRDO, 4.33%, 09/07/00 4,755 6,155 Eagle Tax Exempt Trust, Weekly Option Mode, Water & Sewer Rev., District of Columbia, Ser. 98-5202, FRDO, #, 4.33%, 09/07/00 6,155 10,000 Metropolitan Washington Airport, Rev., 4.30%, 12/06/00 10,000 10,000 Metropolitan Washington Airport, Rev., 4.33%, 11/06/00 10,000 6,900 Metropolitan Washington Airport, Rev., 4.40%, 02/14/01 6,900 6,000 Metropolitan Washington Airport, Rev., 4.50%, 09/06/00 6,000 ------- 63,210 Florida -- 5.4% 400 Alachua County, Florida, Health Facilities Authority, Shands Teaching Hospital, Ser. B, Rev., FRDO, 4.25%, 09/06/00 400 1,600 Broward County, Florida, Ser. C, GO, 5.60%, 01/01/01 1,606 1,150 Collier County, Florida, Health Facilities Authority, The Moorings Inc. Project, Rev., FRDO, 4.30%, 09/06/00 1,150 2,720 Dade County, Florida, Housing Finance Authority, Multi-Family Housing, Kendall Ct. Apartments, Rev., FRDO, 4.30%, 09/07/00 2,720 2,020 Dade County, Florida, Housing Finance Authority, Multi-Family Housing, Star Creek Apartments, Rev., FRDO, 4.30%, 09/07/00 2,020
See notes to financial statements. 28 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------ Money Market Instruments -- Continued - ------------------------------------------------------------------------------------ Florida -- Continued $ 2,155 Dade County, Florida, Housing Finance Authority, Single Family Mortgage, FLOATS, Ser. PT-344, Rev., FRDO, #, 4.38%, 09/07/00 $2,158 5,000 Florida Finance Commission, 4.30%, 01/24/01 5,000 7,185 Florida Housing Finance Corp., Multi-Family Housing, Beneva Project, Ser. C, Rev., FRDO, 4.20%, 09/07/00 7,185 5,000 Florida Housing Finance Corp., Multi-Family Housing, Kings Project, Ser. D, Rev., FRDO, 4.25%, 09/07/00 5,000 3,960 Florida State, Board of Education, Capital Outlay, FLOATS, Ser. PA-696, GO, FRDO, 4.38%, 09/07/00 3,960 5,330 Gulf Breeze, Florida, Local Government Loan Program, Ser. B, Rev., FRDO, 4.25%, 09/07/00 5,330 12,450 Gulf Breeze, Florida, Local Government Loan Program, Ser. C, Rev., FRDO, 4.25%, 09/07/00 12,450 100 Jacksonville, Florida, Capital Project, Ser. 1, Rev., FRDO, 4.25%, 09/06/00 100 8,000 Jacksonville, Florida, Educational Facilities, Jacksonville University Project, Rev., FRDO, 4.25%, 09/07/00 8,000 1,000 Jacksonville, Florida, Health Facilities Authority, River Garden Project, Rev., FRDO, 4.25%, 09/07/00 1,000 6,000 Orange County, Florida, Health Facilities Authority, Florida Hospital Association of Health, Ser. A, Rev., FRDO, 4.35%, 09/06/00 6,000 4,700 Orange County, Florida, Health Facilities Authority, Presbyterian Retirement Project, Rev., FRDO, 4.30%, 09/07/00 4,700 2,000 Orlando, Florida, Utilities Commission, Water & Sewer System, Rev., 4.25%, 10/02/00 2,000 14,100 Tampa, Florida, Sports Authority, Municipal Securities Trust Receipts, Ser. SGA-61, Rev., FRDO, 4.35%, 09/01/00 14,103 4,500 The University of North Florida Foundation Inc., Parking System, Rev., FRDO, 4.30%, 09/07/00 4,500 ------ 89,382 Georgia -- 3.1% 6,600 Atlanta, Georgia, Urban Residential Finance Authority, Multi-Family Housing, The Park at Lakewood, Rev., FRDO, 4.40%, 09/07/00 6,600 10,580 Atlanta, Georgia, Water & Wastewater, Municipal Securities Trust Receipts, Ser. SGA-86, Rev., FRDO, 4.30%, 09/06/00 10,580 1,000 Bibb County, Georgia, Class A Certificates, Ser. C, FRDO, 4.40%, 09/07/00 1,000 6,900 Crisp County, Georgia, Solid Waste Management Authority, Rev., FRDO, 4.38%, 09/07/00 6,900 15,100 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. 97C- 1002, FRDO, #, 4.33%, 09/07/00 15,100 1,000 Fulton County, Georgia, Development Authority, Arthritis Foundation Inc. Project, Rev., FRDO, 4.30%, 09/06/00 1,000 3,000 Georgia Local Government, FLOATS, Ser. PT-1060, COP, FRDO, 4.33%, 09/07/00 3,000 3,849 Georgia Municipal Association Pooled Bond, COP, FRDO, 4.25%, 09/07/00 3,849
See notes to financial statements. 29 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------ Money Market Instruments -- Continued - ------------------------------------------------------------------------------------ Georgia -- Continued $ 1,860 Georgia State, Residential Finance Authority, Home Ownership Mortgage, Ser. A, Rev., FRDO, 4.15%, 12/01/00 $ 1,900 2,000 Municipal Electric Authority of Georgia, Rev., 4.40%, 09/07/00 2,000 ------- 51,929 Hawaii -- 0.1% 1,670 Hawaii State, Housing Finance & Development Corp., Single Family Mortgage, FLOATS, Ser. PA-73A, Rev., FRDO, 4.40%, 09/07/00 1,675 Illinois -- 6.9% 18,400 Chicago, Illinois, Airport, Special Facilities, O'Hare, Rev., FRDO, 4.35%, 09/06/00 18,400 3,000 Chicago, Illinois, Wastewater Transmission, Rev., -, 6.75%, 11/15/00 3,075 20,800 Chicago, Illinois, Water, Municipal Securities Trust Receipts, Ser. SGA-93, Rev., FRDO, 4.35%, 09/01/00 20,800 6,660 Elmhurst, Illinois, Joint Commission Accredation, Rev., FRDO, 4.25%, 09/07/00 6,660 3,205 Illinois Development Finance Authority, IDR, CFC International Inc. Project, Rev., FRDO, 4.30%, 09/07/00 3,205 2,000 Illinois Development Finance Authority, IDR, Valspar Corp. Project, Special Tax, FRDO, 4.40%, 09/07/00 2,000 4,100 Illinois Development Finance Authority, Local Government Financing Program, Ser. A, Rev., FRDO, 4.35%, 09/06/00 4,100 1,820 Illinois Development Finance Authority, Toughy LTD Partnership Project, Rev., FRDO, 4.30%, 09/06/00 1,820 18,540 Illinois Health Facilities Authority, Rev., 4.20%, 10/18/00 18,540 3,000 Illinois Health Facilities Authority, Rev., 4.30%, 10/05/00 3,000 3,600 Illinois Housing Development Authority, Multi-Family Housing, Camelot, Rev., FRDO, 4.45%, 09/06/00 3,600 16,685 Illinois Housing Development Authority, Multi-Family Housing, Lakeshore Plaza, Ser. A, Rev., FRDO, 4.20%, 09/06/00 16,685 2,660 Libertyville, Illinois, Industrial Revenue, Libertyville Manor Project, Rev., FRDO, 4.25%, 09/07/00 2,660 10,000 University of Illinois, Health Services Facilities System, Ser. B, Rev., FRDO, 4.20%, 09/06/00 10,000 ------- 114,545 Indiana -- 2.1% 5,000 DeKalb County, Indiana, Economic Development, New Process Steel Project, Rev., FRDO, 4.45%, 09/07/00 5,000 5,990 Indiana Bond Bank, FLOATS, Ser. PA-688, Rev., FRDO, 4.33%, 09/07/00 5,990 3,000 Indiana State, Development Finance Authority, Environmental Improvement, USX Corp. Project, Rev., FRDO, 3.00%, 03/01/01 3,000 9,000 Indiana State, Development Finance Authority, PCR, Southern Indiana Gas & Electric, Ser. A, Rev., FRDO, 3.00%, 03/01/01 9,000 6,665 Indiana State, Office Building Commission Capital Complex, FLOATS, Ser. PT-381, Rev., FRDO, 4.33%, 09/07/00 6,665
See notes to financial statements. 30 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------ Money Market Instruments -- Continued - ------------------------------------------------------------------------------------ Indiana -- Continued $ 1,270 Lafayette, Indiana, Economic Development, Health Quest Realty Project, Rev., FRDO, 4.30%, 09/07/00 $ 1,270 600 Muncie, Indiana, Economic Development, Health Quest Realty Project, Rev., FRDO, 4.30%, 09/07/00 600 3,305 Municipal Securities Trust Certificates, Ser. 1997-19A, Class A, Rev., FRDO, #, -, 4.30%, 09/06/00 3,305 ------- 34,830 Iowa -- 0.9% 15,000 Iowa School Corporations, Iowa School Cash Anticipation Program, Ser. A, Warrant Certificates, Rev., 5.50%, 06/22/01 15,117 Kansas -- 1.0% 2,000 Eagle Tax-Exempt Trust, Weekly Option Mode, Ser. 2000-1601, FRDO, #, 4.33%, 09/07/00 2,000 8,720 Kansas State, Development Finance Authority, FLOATS, Ser. PA-715, Rev., FRDO, 4.33%, 09/07/00 8,720 2,150 Spring Hill, Kansas, Industrial Revenue, Abrasive Engineering Project, Rev., FRDO, 4.43%, 09/07/00 2,150 1,650 Wichita, Kansas, Airport Facilities, Cessna Citation Center Project, Ser. III, Rev., FRDO, 4.40%, 09/06/00 1,650 1,800 Wichita, Kansas, Hospital, Facilities Improvement, Riverside, Ser. IV, Rev., FRDO, 4.30%, 09/07/00 1,800 ------- 16,320 Kentucky -- 2.2% 3,000 Jeffersontown, Kentucky, Lease Program, Kentucky League of Cities Funding Trust, Rev., FRDO, 4.25%, 09/06/00 3,000 26,575 Kentucky Area Development Districts, Financing Trust Lease Program, Ewing, Kentucky, Rev., FRDO, 4.35%, 09/07/00 26,574 2,000 Kentucky Asset Liability Commission, General Fund, Ser. A, Rev., TRAN, 5.25%, 06/27/01 2,011 2,530 Kentucky Housing Corp., Ser. D, Rev., 4.40%, 01/01/01 2,530 1,000 Kentucky State, Property & Buildings Commission, Project No. 55, Rev., 4.30%, 09/01/00 1,000 1,085 Kentucky State, Property & Buildings Commission, Project No. 66, Ser. A, Rev., 5.00%, 05/01/02 1,089 ------- 36,204 Louisiana -- 1.3% 2,950 Caddo Parish, Louisiana, Industrial Development Board Inc., Frymaster Corp. Project, Rev., FRDO, 4.25%, 09/05/00 2,950 2,685 Iberia Parish, Louisiana, Industrial Development Board Inc., Cuming Insulation Corp. Project, Rev., FRDO, 4.37%, 09/07/00 2,685 2,000 Louisiana Housing Finance Agency, Ser. A-52, Rev., FRDO, 4.50%, 09/06/00 2,000 5,575 Louisiana Public Facilities Authority, Tiger Athletic Foundation Project, Rev., FRDO, 4.28%, 09/07/00 5,575 1,535 New Orleans, Louisiana, Aviation Board, Ser. A, Rev., FRDO, 4.30%, 09/06/00 1,535
See notes to financial statements. 31 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------ Money Market Instruments -- Continued - ------------------------------------------------------------------------------------ Louisiana -- Continued $ 3,000 Plaquemines, Louisiana, Port Harbor & Terminal District, Rev., 4.30%, 12/08/00 $ 3,000 4,000 Plaquemines, Louisiana, Port Harbor & Terminal District, Port Facilities, International Marine Terminal Project, Ser. B, Rev., FRDO, 4.20%, 03/15/01 4,005 ------- 21,750 Maine -- 0.3% 1,000 Maine Educational Loan Marketing Corp., Student Loan, Ser. A-4, Rev., 5.60%, 11/01/00 1,002 3,310 Maine State, Turnpike Authority, FLOATS, Ser. PA-699, Rev., FRDO, 4.33%, 09/07/00 3,311 ------- 4,313 Maryland -- 1.6% 3,000 Anne Arundel County, Maryland, GO, 4.25%, 12/14/00 3,000 8,605 Howard County, Maryland, Multi-Family Housing, Sherwood Crossing LTD, Rev., FRDO, 4.85%, 12/01/00 8,605 5,000 Maryland State, Stadium Authority, Sports Facilities Lease, Rev., FRDO, 4.30%, 09/06/00 5,000 10,000 Municipal Securities Trust Certificates, Ser. 1999-76, Class A, Rev., FRDO, #, 4.55%, 12/01/00 10,000 ------- 26,605 Massachusetts -- 0.5% 5,300 Massachusetts State, Health & Educational Facilities Authority, Municipal Securities Trust Receipts, Ser. SGA-97, Rev., FRDO, 4.35%, 09/01/00 5,300 3,000 Massachusetts State, Ser. A, GO, BAN, +, 5.00%, 09/06/01 3,020 ------- 8,320 Michigan -- 2.8% 1,100 Cornell Township, Michigan, Economic Development Corp., Environmental Improvement, Dates-Mead- Escanaba Paper Co., Rev., FRDO, 4.25%, 09/01/00 1,100 6,100 Holt, Michigan, Public Schools, Ser. B, GO, FRDO, +, 4.30%, 03/01/01 6,100 1,500 Michigan Municipal Bond Authority, Ser. C-2, Rev., 5.00%, 08/23/01 1,510 22,000 Michigan State, Building Authority, Rev., 4.20%, 09/21/00 22,000 1,200 Michigan State, Hospital Finance Authority, Mt. Clemens Hospital, Rev., FRDO, 4.20%, 09/06/00 1,200 6,000 Michigan State, Housing Development Authority, Ser. 1999-B2, Rev., 4.45%, 09/06/00 6,000 7,495 Michigan State, Strategic Fund LTD, FLOATS, Ser. PT-237, Rev., FRDO, 4.33%, 09/07/00 7,495 1,175 Michigan State, Strategic Fund LTD, Wayne Disposal, Oakland Project, Rev., FRDO, 4.35%, 09/06/00 1,175 ------- 46,580 Minnesota -- 0.3% 3,300 Minnesota State, GO, FRDO, 4.33%, 09/07/00 3,300 1,255 Minnesota State, Housing Finance Agency, Single Family Mortgage, Ser. E, Rev., FRDO, 4.35%, 05/01/01 1,255 ------- 4,555
See notes to financial statements. 32 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------ Money Market Instruments -- Continued - ------------------------------------------------------------------------------------ Mississippi -- 0.5% $ 3,030 Mississippi Business Finance Corp., IDR, Choctaw Maid Farms, Inc. Project, Rev., FRDO, 4.35%, 09/06/00 $ 3,030 4,840 Mississippi Home Corp., Single Family Housing, Class A Certificates, Ser. I, Rev., FRDO, 4.40%, 09/07/00 4,840 ------- 7,870 Missouri -- 2.0% 7,335 Independence, Missouri, IDA, Multi-Family Housing, FLOATS, Ser. PT-314, Rev., FRDO, 4.40%, 09/07/00 7,335 3,400 Kansas City, Missouri, IDR, Livers Bronze Co. Project, Rev., FRDO, 4.45%, 09/07/00 3,400 880 Macon, Missouri, IDA, Health Care Realty Macon, Rev., FRDO, 4.40%, 09/01/00 880 1,600 Missouri Higher Education Loan Authority, Student Loan, Ser. B, Rev., FRDO, 4.40%, 09/06/00 1,600 700 Missouri State, Health & Educational Facilities Authority, Medical Research Facilities, Stowers Institute, Rev., FRDO, 4.20%, 09/07/00 700 3,500 Missouri State, Health & Educational Facilities Authority, School District, Advance Funding Program, Saint Charles R-6 School, Ser. J, GO, 4.25%, 09/19/00 3,501 1,900 Missouri State, Health & Educational Facilities Authority, School District, Advance Funding Program, Webster Groves School, Ser. K, GO, 4.25%, 09/19/00 1,900 8,915 Missouri State, Housing Development Commission, FLOATS, Ser. PT-223, Rev., FRDO, 4.50%, 09/01/00 8,915 4,000 Missouri State, Housing Development Commission, Ser. A-64, Rev., FRDO, 4.50%, 09/06/00 4,003 865 Osage Beach, Missouri, IDA, Health Care Realty Osage, Rev., FRDO, 4.40%, 09/01/00 865 ------- 33,099 Montana -- 0.2% 3,785 Montana State, Board of Housing, FLOATS, Ser. PT-356, Rev., FRDO, 4.38%, 09/07/00 3,785 Multiple States -- 0.5% 7,795 Koch Fixed Rate Trust, Variable States, FLOATS, Ser. PL-6A, Rev., FRDO, 4.39%, 09/01/00 7,795 Nebraska -- 0.1% 1,800 Sidney, Nebraska, IDR, Pennington Seed Inc. Project, Rev., FRDO, 4.35%, 09/06/00 1,800 Nevada -- 2.9% 1,600 Clark County, Nevada, Airport, Ser. B-2, Rev., FRDO, 4.25%, 09/06/00 1,600 1,745 Clark County, Nevada, School District, Building & Renovation, Ser. B, GO, 7.50%, 06/15/01 1,786 19,800 Eagle Tax Exempt Trust, Weekly Option Mode, Clark County, Ser. 98-2801, FRDO, #, 4.33%, 09/07/00 19,800 6,250 Nevada Housing Division, Multi-Unit Housing, Joshua Villas, Ser. E, Rev., FRDO, 4.40%, 09/07/00 6,250 4,435 Nevada Housing Division, Multi-Unit Housing, Judith Villas, Ser. C, Rev., FRDO, 4.40%, 09/07/00 4,435
See notes to financial statements. 33 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------ Money Market Instruments -- Continued - ------------------------------------------------------------------------------------ Nevada -- Continued $ 6,750 Nevada Housing Division, Multi-Unit Housing, Ser. A, Rev., FRDO, 4.40%, 09/07/00 $ 6,750 3,195 Nevada Housing Division, Multi-Unit Housing, Ser. M, Rev., FRDO, 4.40%, 09/07/00 3,195 4,400 Nevada State, Municipal Securities Trust Receipts, Ser. SGB-31, GO, FRDO, 4.33%, 09/07/00 4,400 ------- 48,216 New Hampshire -- 0.3% 1,540 New Hampshire State, Business Finance Authority, Industrial Facilities, Nickerson Assembly Co., Rev., FRDO, 4.50%, 09/06/00 1,540 3,870 New Hampshire State, Housing Finance Authority, Single Family Housing, FLOATS, Ser. PT-115, Rev., FRDO, 4.40%, 09/07/00 3,870 ------- 5,410 New Jersey -- 0.2% 2,700 New Jersey Economic Development Authority, Danic Urban Renewal, Rev., FRDO, 3.70%, 09/07/00 2,700 New Mexico -- 0.5% 3,000 New Mexico State, Hospital Equipment Loan Council, Pooled Loan Program, Ser. A, Rev., FRDO, 4.35%, 09/06/00 3,000 5,000 New Mexico State, Rev., TRAN, 5.00%, 06/29/01 5,028 ------- 8,028 New York -- 4.9% 1,235 Eagle Tax-Exempt Trust, Weekly Option Mode, Ser. 96C-4901, Class A, FRDO, #, 3.30%, 09/07/00 1,235 1,305 Fort Plain, New York, Central School District, GO, 4.75%, 06/15/01 1,308 15,560 IBM Tax Exempt Grantor Trust, IBM Project, FLOATS, Weekly Receipt, FRDO, 4.48%, 09/07/00 15,560 3,000 Jamestown, New York, City School District, GO, 4.90%, 06/15/01 3,009 1,520 Monroe County, New York, Airport Authority, FLOATS, Ser. PA-585, Rev., FRDO, 4.29%, 09/07/00 1,520 6,000 Municipal Securities Trust Certificates, Ser. 2000-92, Class A, GO, FRDO, #, 4.35%, 09/01/00 6,000 7,700 Municipal Securities Trust Certificates, Ser. 2000-93, Class A, Rev., FRDO, #, 4.35%, 09/01/00 7,701 16,300 Nassau County, New York, Ser. B, Tax Exempt Anticipation Note, GO, RAN, 6.00%, 03/20/01 16,432 8,900 New York City, New York, Trust Cultural Resources, American Museum of National History, Ser. B, Rev., FRDO, 4.58%, 07/01/01 8,900 3,000 New York State, Environmental Quality, Ser. G, GO, FRDO, 3.90%, 09/06/00 3,000 1,540 New York State, Job Development Authority, Ser. B-1 through B-21, Rev., FRDO, 4.40%, 09/01/00 1,540 1,020 Rome, New York, City School District, GO, 5.38%, 06/15/01 1,027 10,000 Suffolk County, New York, Floating Rate Trust Receipts, Ser. A-38, Regulation D, GO, FRDO, 4.50%, 09/06/00 10,000
See notes to financial statements. 34 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------ Money Market Instruments -- Continued - ------------------------------------------------------------------------------------ New York -- Continued $ 4,200 Triborough Bridge & Tunnel Authority, New York, FLOATS, Ser. SG-41, Rev., FRDO, 4.24%, 09/07/00 $ 4,200 ------- 81,432 North Carolina -- 0.6% 2,000 Gaston County, North Carolina, Industrial Facilities & PCFA, Industrial Development, Quality Metal Project, Rev., FRDO, 4.40%, 09/07/00 2,000 900 Guilford County, North Carolina, Industrial Facilities & PCFA, Neal Manufacturing, Rev., FRDO, 4.40%, 09/07/00 900 5,000 Mecklenburg County, North Carolina, Public Improvement, Ser. C, GO, FRDO, 4.30%, 09/06/00 5,000 2,400 North Carolina, Medical Care Commission, Health Care Facilities, The Givens Estates Inc. Project, Rev., FRDO, 4.35%, 09/01/00 2,400 ------- 10,300 North Dakota -- 1.0% 16,000 North Dakota State, Housing Finance Agency, Housing Finance Program, Home Mortgage, Ser. D, Rev., @, 4.45%, 08/27/01 16,000 Ohio -- 1.0% 5,000 Columbus, Ohio, Ser. 1, GO, FRDO, 4.10%, 09/07/00 5,000 1,000 Ohio Housing Finance Agency, Residential Mortgage, Ser. A-2, Rev., 4.25%, 09/01/00 1,000 4,900 Ohio Housing Finance Agency, Residential Mortgage, Ser. C, Rev., +, 4.35%, 09/01/01 4,900 3,595 Ohio Housing Finance Agency, Single Family Mortgage, FLOATS, Ser. PT-71, Rev., FRDO, 4.40%, 09/07/00 3,667 1,000 Ohio State, Public Facilities Commission, Higher Education Capital Facilities, Ser. II-B, Rev., 4.50%, 11/01/00 1,000 1,330 Ohio State, Water Development Authority, Pollution Control Facilities, Water Control Loan Fund, State Match, Rev., 5.50%, 06/01/01 1,340 ------- 16,907 Oklahoma -- 0.6% 3,000 Oklahoma Development Finance Authority, Oklahoma Hospital Association, Ser. A, Rev., FRDO, 4.35%, 09/06/00 3,000 7,000 Oklahoma State, Water Resource Board, State Loan Program, Rev., FRDO, 4.05%, 03/01/01 7,000 ------- 10,000 Oregon -- 0.6% 5,240 Oregon State, Housing & Community Services Department, Single Family Mortgage Program, Ser. C, Rev., 4.25%, 03/29/01 5,240 1,900 Oregon State, Ser. 73-E, GO, FRDO, 4.15%, 09/06/00 1,900 3,470 Port Portland, Oregon, Airport, Ser. 7-A, Rev., -, 6.75%, 07/01/01 3,563 ------- 10,703
See notes to financial statements. 35 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Money Market Instruments -- Continued - ------------------------------------------------------------------------------------- Pennsylvania -- 1.5% $ 3,900 Butler County, Pennsylvania, Hospital Authority, North Hills Passavant Hospital, Ser. A, Rev., -, 7.00%, 06/01/01 $ 4,040 100 Delaware Valley, Pennsylvania, Regional Finance Authority, Local Government, Rev., FRDO, 4.30%, 09/06/00 100 500 Geisinger Authority, Pennsylvania, Health System, Penn State Geisinger Health, Ser. B, Rev., FRDO, 4.30%, 09/01/00 500 2,000 Harrisburg, Pennsylvania, Water Authority, Municipal Securities Trust Receipts, Ser. SGA-80, Rev., FRDO, 4.30%, 09/06/00 2,000 5,000 Pennsylvania State, Higher Education Assistance Agency, Student Loan, Ser. A, Rev., FRDO, 4.35%, 09/06/00 5,000 4,230 Philadelphia, Pennsylvania, IDA, Airport, FLOATS, Ser. PT-417, Rev., FRDO, 4.55%, 06/14/01 4,230 4,425 Philadelphia, Pennsylvania, Redevelopment Authority, Multi-Family Housing, Courts Project, Ser. A, Rev., FRDO, 4.30%, 09/07/00 4,425 5,000 Philadelphia, Pennsylvania, Ser. A, Rev., TRAN, @, 5.00%, 06/29/01 5,025 ------- 25,320 Rhode Island -- 0.3% 4,995 Rhode Island Refunding Bond Authority, State Public Projects, FLOATS, Ser. PT-419, Rev., 4.50%, 06/14/01 4,995 South Carolina -- 1.8% 4,000 Kershaw County, South Carolina, IDR, New South Inc. Project, Rev., FRDO, 4.30%, 09/07/00 4,000 2,000 South Carolina State, Public Service Authority, Municipal Trust Receipts, Ser. SG-32, Rev., FRDO, 4.33%, 09/07/00 2,003 4,500 South Carolina State, Public Service Authority, Ser. A, Rev., 4.50%, 01/01/01 4,504 18,800 South Carolina Transportation Infrastructure Bank, Floating Rate Trust Receipts, Ser. L-10, Regulation D, Rev., FRDO, 4.45%, 09/06/00 18,802 ------- 29,309 South Dakota -- 0.9% 14,595 South Dakota Housing Development Authority, FLOATS, Ser. PT-73, Rev., FRDO, 4.33%, 09/07/00 14,595 Tennessee -- 8.5% 16,125 Clarksville, Tennessee, Public Building Authority, Pooled Financing, Tennessee Municipal Bond Fund, Rev., FRDO, 4.25%, 09/07/00 16,125 5,995 Metropolitan Government Nashville & Davidson Counties, Tennessee, FLOATS, Ser. PT-394, Rev., FRDO, 4.45%, 09/07/00 5,995 2,500 Metropolitan Government of Nashville & Davidson Counties, Tennessee, Health & Education Facilities Board, Vanderbilt University, Ser. 85-A, Rev., FRDO, 4.15%, 01/15/01 2,500
See notes to financial statements. 36 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Money Market Instruments -- Continued - ------------------------------------------------------------------------------------- Tennessee -- Continued $ 7,500 Metropolitan Government of Nashville & Davidson Counties, Tennessee, Industrial Development Board, Country Music Hall of Fame, Rev., FRDO, 4.20%, 09/07/00 $ 7,500 1,500 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. II-A-1, Rev., FRDO, 4.30%, 09/07/00 1,500 2,500 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. II-A-2, Rev., FRDO, 4.30%, 09/07/00 2,500 4,000 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. II-D-2, Rev., FRDO, 4.30%, 09/07/00 4,000 9,400 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. II-D-2, Rev., FRDO, 4.30%, 09/07/00 9,400 1,160 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. II-D-3, Rev., FRDO, 4.30%, 09/07/00 1,160 6,800 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. III-C-5, Rev., FRDO, 4.30%, 09/07/00 6,800 1,600 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. III-D-3, Rev., FRDO, 4.30%, 09/07/00 1,600 5,000 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. III-E-2, Rev., FRDO, 4.30%, 09/07/00 5,000 2,500 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. III-E-3, Rev., FRDO, 4.30%, 09/07/00 2,500 5,500 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. III-G-2, Rev., FRDO, 4.30%, 09/07/00 5,500 7,600 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. IV-1, Rev., FRDO, 4.35%, 09/01/00 7,600 5,000 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. IV-3, Rev., FRDO, 4.35%, 09/01/00 5,000 7,000 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. IV-A-3, Rev., FRDO, 4.35%, 09/01/00 7,000 4,700 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. IV-B-12, Rev., FRDO, 4.35%, 09/01/00 4,700 5,200 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. IV-B-5, Rev., FRDO, 4.35%, 09/01/00 5,200 4,500 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. IV-B-9, Rev., FRDO, 4.35%, 09/01/00 4,500
See notes to financial statements. 37 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - -------------------------------------------------------------------------------------- Money Market Instruments -- Continued - -------------------------------------------------------------------------------------- Tennessee -- Continued $ 5,000 Sevier County, Tennessee, Public Building Authority, Local Government Public Improvement, Ser. IV-D-1, Rev., FRDO, 4.35%, 09/01/00 $ 5,000 6,200 Shelby County, Tennessee, Health, Educational & Housing Facilities Board, Baptist Health, Rev., FRDO, 4.45%, 01/18/01 6,200 5,465 Shelby County, Tennessee, Health, Educational & Housing Facilities Board, Educational Facilities, Rhodes College, Rev., FRDO, 4.25%, 09/07/00 5,465 300 Shelby County, Tennessee, Ser. A, GO, FRDO, 4.20%, 09/06/00 300 700 South Pittsburgh, Tennessee, Industrial Development Board, Lodge Manufacturing Co. Project, Rev., FRDO, 4.35%, 09/06/00 700 3,635 Tennessee Housing Development Agency, FLOATS, Ser. PA-726R, Rev., FRDO, 4.38%, 09/07/00 3,635 13,530 Tennessee, Housing Development Agency, FLOATS, Ser. PT-279, Rev., FRDO, 4.30%, 01/01/01 13,530 -------- 140,910 Texas -- 18.4% 1,500 Addison, Texas, GO, 6.25%, 09/01/00 1,500 2,000 Austin, Texas, Independent School District, GO, 5.20%, 08/01/01 2,014 1,135 Austin, Texas, Public Improvement, GO, 7.00%, 09/01/00 1,135 1,000 Brazos River Authority, Texas, PCR, TXU Electric Co., Ser. C, Rev., FRDO, 4.40%, 09/06/00 1,000 800 Brazos River Authority, Texas, PCR, Utilities Electric Co., Ser. B, Rev., FRDO, 4.40%, 09/01/00 800 9,200 Carroll, Texas, Independent School District, GO, FRDO, 4.20%, 09/07/00 9,200 6,200 City of El Paso, Texas, GO, 4.15%, 09/05/00 6,200 2,000 City of El Paso, Texas, GO, 4.40%, 09/07/00 2,000 8,200 Dallas County, Texas, Ser. C, GO, FRDO, 4.65%, 06/15/01 8,200 1,800 Dallas, Texas, Area Rapid Transit, North Central Light Rail, Rev., FRDO, 4.20%, 09/06/00 1,800 5,000 Dallas-Fort Worth, Texas, International Airport Facilities Improvement Corp., Flight Safety Project, Rev., FRDO, 4.40%, 09/07/00 5,000 1,855 Dallas-Fort Worth, Texas, Regional Airport, Municipal Securities Trust Receipts, Ser. SGA-49, Rev., FRDO, 4.35%, 09/01/00 1,855 5,000 Dallas-Fort Worth, Texas, Regional Airport, Ser. A-CR-103, Rev., FRDO, 4.35%, 02/01/01 5,000 5,000 Dallas-Fort Worth, Texas, Regional Airport, Ser. A-CR-104, Rev., FRDO, 4.35%, 02/01/01 5,000 4,500 Dallas-Fort Worth, Texas, Regional Airport, Ser. A-CR-107, Rev., FRDO, 4.35%, 02/01/01 4,500 16,100 Denton, Texas, Independent School District, GO, FRDO, 4.33%, 02/01/01 16,100 1,270 Denton, Texas, Utility Systems, Ser. A, Rev., 4.88%, 12/01/00 1,272 3,910 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. 99-4302, #, FRDO, 4.33%, 09/07/00 3,910
See notes to financial statements. 38 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------ Money Market Instruments -- Continued - ------------------------------------------------------------------------------------ Texas -- Continued $ 8,400 Greater East Texas, Higher Education, Ser. B, Rev., FRDO, 3.85%, 09/07/00 $ 8,400 10,000 Greater Texas, Student Loan Corp., Student Loan, Ser. A, Rev., 4.22%, 02/01/01 10,000 3,000 Guadalupe Blanco River Authority, Texas, Industrial Development Corp., IDR, The BOC Group Inc. Project, Rev., FRDO, 4.30%, 09/07/00 3,000 5,000 Harlandale, Texas, Independent School District, Municipal Securities Trust Receipts, Ser. SGA-100, GO, FRDO, 4.40%, 09/06/00 5,000 1,520 Harris County, Texas, GO, @, 4.25%, 10/04/00 1,520 5,100 Harris County, Texas, GO, 4.25%, 10/05/00 5,100 7,900 Hays, Texas, Memorial Health Facilities Development Corp., Central Texas Medical Center Project, Ser. A, Rev., 4.30%, 09/07/00 7,900 10,000 Houston, Texas, Airport System, Rev., 4.30%, 10/11/00 10,000 1,400 Houston, Texas, Ser. A, GO, 4.35%, 01/11/01 1,400 3,000 Houston, Texas, Ser. B, GO, 4.30%, 11/28/00 3,000 5,000 Houston, Texas, Ser. C, GO, 4.30%, 11/28/00 5,000 10,000 Houston, Texas, Water & Sewer System, Rev., 4.30%, 11/09/00 10,000 2,930 Humble, Texas, Independent School District, GO, 6.50%, 02/15/01 2,960 3,900 Katy, Texas, Independent School District, Ser, A, GO, FRDO, 4.20%, 09/07/00 3,900 4,200 Longview, Texas, Industrial Corp., Collins Industries Inc. Project, Rev., FRDO, 4.45%, 09/07/00 4,200 5,000 Mesquite, Texas, Independent School District, GO, FRDO, 4.45%, 02/01/01 5,002 1,355 Midland, Texas, Independent School District, GO, FRDO, 4.20%, 09/07/00 1,355 30,000 North Central Texas, Health Facilities Development Corp., Rev., 4.35%, 12/12/00 29,999 4,700 Richardson, Texas, Independent School District, Ser. A, GO, FRDO, 4.20%, 09/07/00 4,700 7,190 San Angelo, Texas, Independent School District, GO, FRDO, 4.25%, 09/07/00 7,190 19,920 San Antonio, Texas, Electric & Gas, Municipal Securities Trust Receipts, Ser. SGA-48, Rev., FRDO, 4.30%, 09/06/00 19,920 5,000 San Antonio, Texas, Water Revenue, Municipal Securities Trust Receipts, Ser. SGA-42, Rev., FRDO, 4.30%, 09/06/00 5,000 3,830 Tarrant County, Texas, Housing Finance Corp, Multi-Family Housing, Remington Project, Rev., FRDO, 4.20%, 09/06/00 3,830 5,565 Texas State, Department of Housing & Community Affairs, Residential Mortgage, FLOATS, Ser. PA-743R, Rev., FRDO, 4.40%, 09/07/00 5,565 10,000 Texas State, Floating Rate Trust Receipts, Ser. A-18, Regulation D, Rev., FRDO, 4.45%, 09/01/00 10,000 12,000 Texas State, Floating Rate Trust Receipts, Ser. N-19, Regulation D, Rev., FRDO, 4.45%, 09/06/00 12,000
See notes to financial statements. 39 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - -------------------------------------------------------------------------------------- Money Market Instruments -- Continued - -------------------------------------------------------------------------------------- Texas -- Continued $ 4,945 Texas State, FLOATS, Ser. PT-1991, Rev., FRDO, 4.38%, 09/07/00 $ 4,945 5,000 Texas State, Rev., TRAN, 5.25%, 08/31/01 5,047 10,000 Texas State, Ser. 93-A, GO, 4.30%, 10/04/00 10,000 3,000 Texas State, Turnpike Authority, Dallas North Thruway, Floating Rate Receipts, Ser. SG-70, Rev., FRDO, 4.33%, 09/07/00 3,000 4,400 Texas State, Veteran's Housing Assistance, Ser. A-1, GO, FRDO, 4.50%, 09/06/00 4,400 13,290 University of Texas, Municipal Securities Trust Receipts, Ser. SGA-78, Rev., FRDO, 4.30%, 09/06/00 13,290 1,800 West Side Calhoun County, Texas, Naval District, Sewer & Solid Waste Disposal, BP Chemicals Inc. Project, Rev., FRDO, 4.45%, 09/01/00 1,800 -------- 304,909 Utah -- 0.4% 2,100 Utah State Board of Regents, Student Loan, Ser. C, Rev., FRDO, 4.30%, 09/06/00 2,100 5,000 Utah State, Housing Finance Agency, Single Family Mortgage, Ser. E-1, Rev., FRDO, 3.85%, 09/06/00 5,000 -------- 7,100 Virginia -- 1.9% 2,000 Harrisonburg, Virginia, Redevelopment & Housing Authority, Multi-Family Housing, Misty Ridge Project, Ser. A, Rev., FRDO, 4.30%, 09/07/00 2,000 4,870 King George County, Virginia, IDA, Exempt Facilities, Birchwood Power Partners, Ser. B, Rev., FRDO, 4.45%, 09/01/00 4,870 1,100 Lynchburg, Virginia, IDA, Hospital Facilities, First Mortgage, VHA Mid Atlantic/Cap, Ser. E, Rev., FRDO, 4.25%, 09/06/00 1,100 12,893 Norfolk, Virginia, Airport Authority, Rev., 4.35%, 01/16/01 12,893 800 Petersburg, Virginia, Hospital Authority, Hospital Facilities, Southside Regional, Rev., FRDO, 4.35%, 09/01/00 800 7,150 Roanoke, Virginia, IDA, Hospital, Carilion Health Systems, Ser. B, Rev., FRDO, 4.35%, 09/01/00 7,150 2,385 Spotsylvania County, Virginia, IDA, Residential Care Facilities, Chancellor's Village Project, Rev., FRDO, 4.25%, 09/07/00 2,385 -------- 31,198 Washington -- 5.5% 12,150 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. A, FRDO, #, 4.33%, 09/07/00 12,150 15,830 King County, Washington, FLOATS, Ser. PT-385, Rev., FRDO, 4.45%, 09/07/00 15,830 950 King County, Washington, Housing Authority, Auburn Court Apartments Project, Rev., FRDO, 4.40%, 09/07/00 950 2,000 Port Townsend, Washington, Industrial Development, Port Townsend Paper Corp., Ser. A, Rev., FRDO, 4.40%, 09/07/00 2,000
See notes to financial statements. 40 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - -------------------------------------------------------------------------------------- Money Market Instruments -- Continued - -------------------------------------------------------------------------------------- Washington -- Continued $ 1,050 Redmond, Washington, Public Corp., Industrial Revenue, Integrated Circuits Project, Rev., FRDO, 4.35%, 09/07/00 $ 1,050 1,275 Seattle, Washington, Housing Authority, Low Income Housing Assistance, Bayview Manor Project, Ser. B, Rev., FRDO, 4.15%, 09/07/00 1,275 8,955 Seattle, Washington, Municipal Light & Power, Municipal Securities Trust Receipts, Ser. SGA-96, Rev., FRDO, 4.35%, 09/01/00 8,956 11,450 Seattle, Washington, Municipal Light & Power, Rev., 4.20%, 10/19/00 11,450 15,715 Seattle, Washington, Water Systems, Municipal Securities Trust Receipts, Ser. SGA-90, Rev., FRDO, 4.30%, 09/06/00 15,715 7,020 Washington State, GO, 4.25%, 10/04/00 7,020 2,000 Washington State, Health Care Facilities Authority, Sisters of Providence, Rev., -, 8.25%, 10/01/00 2,046 1,000 Washington State, Housing Finance Commission, Non-Profit Housing, Golden Sands Project, Rev., FRDO, 4.25%, 09/01/00 1,000 3,000 Washington State, Housing Finance Commission, Single Family Program, Ser. 1-A-S, Rev., 4.20%, 02/01/01 3,000 2,500 Washington State, Housing Finance Commission, Single Family Program, Ser. 2-A-S, Rev., 4.40%, 04/01/01 2,500 4,000 Washington State, Public Power Supply System, Nuclear Project No. 1, Ser. A, Rev., -, 6.88%, 07/01/01 4,148 2,000 Washington State, Public Power Supply System, Nuclear Project No. 2, Ser. C, Rev., -, 7.50%, 01/01/01 2,060 ------- 91,150 West Virginia -- 0.3% 5,765 West Virginia State, Building Commission, FLOATS, Ser. PA-520, Rev., FRDO, 4.38%, 09/07/00 5,765 Wisconsin -- 3.5% 9,800 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. 94-4904, FRDO, #, 4.35%, 09/07/00 9,800 1,550 Milwaukee County, Wisconsin, Airport, Ser. A, GO, 4.50%, 10/01/00 1,550 14,455 Municipal Securities Trust Certificates, Ser. 1999-70, Class A, Rev., FRDO, 4.30%, 09/06/00 14,455 3,250 Wisconsin Housing & Economic Development Authority, Home Ownership, Floating Rate Trust Receipts, Ser. 18, Rev., FRDO, 4.55%, 09/06/00 3,250 5,800 Wisconsin Public Power Inc. System, Power Supply System, Municipal Securities Trust Receipts, Ser. SGA-2, Rev., FRDO, 4.30%, 09/06/00 5,807 5,000 Wisconsin State, Clean Water, Ser. 1, Rev., -, 6.75%, 06/01/01 5,172 7,200 Wisconsin State, Health & Education Facilities Authority, Rev., 4.25%, 10/16/00 7,200 10,000 Wisconsin State, Transportation, Rev., 4.20%, 10/05/00 10,000 ------- 57,234
See notes to financial statements. 41 CHASE VISTA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------------ Money Market Instruments -- Continued - ------------------------------------------------------------------------------------------ Wyoming -- 0.6% $ 1,300 Lincoln County, Wyoming, PCR, Exxon Project, Ser. D, Rev., FRDO, 4.25%, 09/01/00 $ 1,300 7,860 Wyoming Community Development Authority, Housing, FLOATS, Ser. PT-195, Rev., FRDO, 4.38%, 09/07/00 7,860 ---------- 9,160 ---------- Total Municipal Securities 1,650,982 (Cost $1,650,982) - ------------------------------------------------------------------------------------------ Total Investments -- 100.2% $1,658,436 (Cost $1,658,436)* - ------------------------------------------------------------------------------------------
See notes to financial statements. 42 - -------------------------------------------------------------------------------- CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments - -------------------------------------------------------------------------------- As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - 100.4% - ------------------------------------------------------------------------------------- New York -- 100.4% $ 21,402 ABN AMRO Munitops, Certificates Trust, New York, Ser. 1999-3, FRDO, #, 4.20%, 09/06/00 $21,402 12,000 ABN AMRO Munitops, Certificates Trust, New York, Ser. 1999-13, FRDO, #, 4.20%, 09/06/00 12,000 5,500 Albany, New York, City School District, GO, RAN, 5.00%, 10/25/00 5,502 5,000 Albany, New York, City School District, GO, TAN, 4.50%, 10/12/00 5,002 11,530 Albany, New York, GO, BAN, 5.00%, 08/03/01 11,564 590 Albany, New York, IDA, IDR, Newkirk Productions Inc. Project, Ser. A, Rev., FRDO, 4.15%, 09/07/00 590 8,000 Attica, New York, Central School District, GO, BAN, @, 5.00%, 04/18/01 8,024 8,915 Attica, New York, Central School District, GO, BAN, 5.00%, 06/15/01 8,937 1,600 Babylon, New York, IDA, IDR, Edwin Berger/Lambro Industries, Rev., FRDO, 4.15%, 09/06/00 1,600 9,400 Babylon, New York, IDA, Resource Recovery, OFS Equity Babylon Project, Rev., FRDO, 4.35%, 09/01/00 9,400 1,500 Beacon, New York, City School District, GO, RAN, 6.00%, 09/29/00 1,501 1,690 Beacon, New York, GO, BAN, 4.75%, 02/15/01 1,693 3,000 Beekmantown, New York, Central School District, GO, BAN, 5.00%, 06/29/01 3,011 7,500 Board of Cooperative Educational Services, New York, Sole Supervisory District, GO, RAN, 5.00%, 06/22/01 7,519 6,000 Board of Cooperative Educational Services, New York, Sole Supervisory District, GO, RAN, 5.00%, 06/27/01 6,019 9,620 Board of Cooperative Educational Services, New York, Sole Supervisory District, GO, RAN, 5.00%, 06/29/01 9,639 4,000 Board of Cooperative Educational Services, New York, Sole Supervisory District, GO, RAN, 5.25%, 06/22/01 4,014 795 Brockport, New York, Central School District, GO, 5.40%, 06/15/01 800 2,906 Brookhaven, New York, IDA, IDR, Waverly Association LLC, Rev., FRDO, 4.30%, 09/07/00 2,906 850 Broome County, New York, IDA, IDR, Binghamton Realty Project, Rev., FRDO, 4.10%, 09/06/00 850 7,000 Buffalo, New York, Ser. A, GO, BAN, 5.50%, 11/15/00 7,012 3,075 Camden, New York, Central School District, GO, RAN, 5.00%, 06/29/01 3,086 3,544 Carthage, New York, Central School District, GO, RAN, 5.00%, 06/22/01 3,552 2,670 Chautauqua County, New York, GO, BAN, 4.50%, 03/06/01 2,672 9,400 Chautauqua Lake, New York, Central School District, GO, BAN, 4.50%, 03/15/01 9,410 1,750 Chenango Forks, New York, Central School District, GO, BAN, 4.25%, 09/08/00 1,750 1,525 Chittenango, New York, Central School District, GO, RAN, 5.00%, 06/29/01 1,530 850 Corning, New York, GO, 4.70%, 09/01/00 850
See notes to financial statements. 43 CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- New York -- Continued $ 5,000 Cortland, New York, City School District, GO, RAN, 5.00%, 06/29/01 $ 5,018 2,100 Dutchess County, New York, IDA, Civic Facility, Marist College, Ser. A, Rev., FRDO, 4.10%, 09/07/00 2,100 2,580 Dutchess County, New York, IDA, IDR, Laerdal Medical Corp. Project, Rev., FRDO, 4.30%, 09/06/00 2,580 1,130 Dutchess County, New York, Resource Recovery Agency, Solid Waste Systems, Ser. A, Rev., 4.45%, 01/01/01 1,131 10,000 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. 94-3203, Class A, FRDO, #, 4.30%, 09/07/00 10,000 8,805 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. 94-3205, Class A, FRDO, #, 4.30%, 09/07/00 8,805 9,910 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. 94-3208, Class A, FRDO, #, 4.30%, 09/07/00 9,910 20,880 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. 95-3202, Class A, FRDO, #, 4.30%, 09/07/00 20,880 18,900 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. 95-3203, Class A, FRDO, #, 4.30%, 09/07/00 18,900 12,155 Eagle Tax Exempt Trust, Long Option Mode, Ser. 96-3207, Class A, FRDO, #, 4.15%, 09/07/00 12,155 11,000 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. 96C-3203, Class A, FRDO, #, 4.30%, 09/07/00 11,000 14,850 Eagle Tax Exempt Trust, Weekly Option Mode, Ser. 96C-3208, Class A, FRDO, #, 4.30%, 09/07/00 14,850 8,200 Eastern Suffolk, New York, Board of Cooperative Educational Services District, GO, RAN, 5.00%, 06/28/01 8,223 650 Elba, New York, Central School District, GO, 5.50%, 06/15/01 653 2,700 Erie County, New York, Water Authority, Ser. A, Rev., FRDO, 4.10%, 09/06/00 2,700 400 Erie County, New York, Water Authority, Ser. B, Rev., FRDO, 4.10%, 09/06/00 400 4,000 Fredonia, New York, Central School District, GO, BAN, 4.75%, 02/08/01 4,008 595 Glens Falls, New York, IDA, IDR, Broad Street Center Project, Rev., FRDO, 4.25%, 09/06/00 595 1,955 Glenville, New York, GO, BAN, 5.00%, 07/13/01 1,961 4,210 Great Neck North, New York, Water Authority, Water System, Ser. A, Rev., FRDO, 4.25%, 09/06/00 4,210 300 Guilderland, New York, IDA, IDR, Northeastern Industrial Park, Ser. A, Rev., FRDO, 4.10%, 09/06/00 300 2,000 Hempstead, New York, IDA, IDR, Trigen-Nassau Energy, Rev., FRDO, 4.05%, 09/06/00 2,000 2,000 Hempstead, New York, Union Free School District, GO, TAN, 5.25%, 06/28/01 2,011 3,550 Hilton, New York, Central School District, GO, RAN, 5.00%, 04/26/01 3,559 1,890 Ilion, New York, Central School District, GO, BAN, 5.00%, 03/29/01 1,895 3,256 Ilion, New York, Central School District, GO, RAN, 5.00%, 06/29/01 3,268 2,000 Islip, New York, IDA, Brentwood Distribution Co. Facility, Rev., FRDO, 4.20%, 09/07/00 2,000
See notes to financial statements. 44 CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - -------------------------------------------------------------------------------------- Municipal Securities - Continued - -------------------------------------------------------------------------------------- New York -- Continued $ 5,060 Lisbon, New York, Central School District, GO, BAN, 4.75%, 04/27/01 $ 5,068 8,780 Long Island Power Authority, New York, Electric Systems, Floating Rate Receipts, Ser. SG-125, Rev., FRDO, 4.29%, 09/07/00 8,780 5,000 Long Island Power Authority, New York, Electric Systems, FLOATS, Ser. PA-420, Rev., FRDO, 4.29%, 09/07/00 5,000 12,000 Long Island Power Authority, New York, Electric Systems, Sub. Ser. 2, Rev., FRDO, 4.15%, 09/06/00 12,000 20,400 Long Island Power Authority, New York, Electric Systems, Sub. Ser. 3, Rev., FRDO, 4.00%, 09/07/00 20,400 10,200 Long Island Power Authority, New York, Electric Systems, Sub. Ser. 3, Rev., FRDO, 4.15%, 10/04/00 10,200 2,600 Long Island Power Authority, New York, Electric Systems, Sub. Ser. 3, Rev., FRDO, 4.20%, 09/07/00 2,600 15,800 Long Island Power Authority, New York, Electric Systems, Sub. Ser. 3, Rev., FRDO, 4.25%, 10/04/00 15,800 9,900 Long Island Power Authority, New York, Electric Systems, Sub. Ser. 4, Rev., FRDO, 4.25%, 09/07/00 9,900 12,360 Long Island Power Authority, New York, Electric Systems, Sub. Ser. 5, Rev., FRDO, 4.30%, 09/01/00 12,360 39,640 Long Island Power Authority, New York, Electric Systems, Sub. Ser. 6, Rev., FRDO, 4.20%, 09/01/00 39,640 14,100 Long Island Power Authority, New York, Electric Systems, Sub. Ser. 7, Sub. Ser. 7-A, Rev., FRDO, 3.90%, 09/06/00 14,100 8,110 Longwood Central School District, Suffolk County, New York, GO, TAN, 5.00%, 06/29/01 8,132 2,900 Marlboro, New York, Central School District, GO, TAN, 4.50%, 11/17/00 2,901 3,985 Metropolitan Transportation Authority, New York, Commuter Facilities, Municipal Securities Trust Receipts, Ser. SGA-82, Rev., FRDO, 4.20%, 09/06/00 3,985 6,815 Metropolitan Transportation Authority, New York, Dedicated Tax Fund, FLOATS, Ser. PA-683, Rev., FRDO, 4.24%, 09/07/00 6,815 16,500 Metropolitan Transportation Authority, New York, Transportation Facilities, Rev., 4.15%, 11/01/00 16,500 14,500 Metropolitan Transportation Authority, New York, Transportation Facilities, Rev., 4.20%, 10/05/00 14,500 31,000 Metropolitan Transportation Authority, New York, Transportation Facilities, Special Obligation, Ser. CP-1, BAN, 4.00%, 09/05/00 31,000 4,400 Mexico, New York, Central School District, GO, RAN, 5.00%, 06/21/01 4,410 4,695 Middletown, New York, GO, BAN, 4.00%, 09/01/00 4,695 2,228 Milford, New York, Central School District, GO, BAN, 4.25%, 09/28/00 2,229 1,500 Monroe County, New York, IDA, Public Improvements, Canal Ponds Park, Ser. D, Rev., FRDO, 4.25%, 09/06/00 1,500 6,695 Municipal Securities Trust Certificates, Ser. 2000-89, Class A, Rev., FRDO, #, 4.35%, 09/01/00 6,695
See notes to financial statements. 45 CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- New York -- Continued $ 18,620 New York City, New York, FLOATS, Ser. PA-442, GO, FRDO, 4.29%, 09/07/00 $18,620 9,245 New York City, New York, FLOATS, Ser. PT-405, GO, FRDO, 4.29%, 09/07/00 9,245 34,000 New York City, New York, FLOATS, Ser. PT-1038, GO, FRDO, 4.29%, 09/07/00 34,000 13,170 New York City, New York, Housing Development Corp., Multi-Family Housing, Columbus Apartments, Ser. A, Rev., FRDO, 4.10%, 09/06/00 13,170 8,500 New York City, New York, Housing Development Corp., Multi-Family Housing, James Tower Development, Ser. A, Rev., FRDO, 4.15%, 09/06/00 8,500 2,900 New York City, New York, Housing Development Corp., Multi-Family Housing, Spring Creek III Project, Ser. A, Rev., FRDO, 4.10%, 09/06/00 2,900 1,300 New York City, New York, Housing Development Corp., Multi-Family Housing, Sullivan Street Project, Ser. A, Rev., FRDO, 4.10%, 09/06/00 1,300 3,400 New York City, New York, Housing Development Corp., Multi-Family Rental Housing, 100 Jane Street Development, Ser. A, Rev., FRDO, 4.10%, 09/06/00 3,400 8,050 New York City, New York, Housing Development Corp., Multi-Family Rental Housing, Monterey, Ser. A, Rev., FRDO, 4.15%, 09/06/00 8,050 3,000 New York City, New York, Housing Development Corp., Multi-Family Rental Housing, One Columbus Place Development, Ser. A, Rev., FRDO, 4.10%, 09/06/00 3,000 2,000 New York City, New York, Housing Development Corp., Multi-Family Rental Housing, Tribeca Tower, Ser. A, Rev., FRDO, 4.10%, 09/06/00 2,000 3,000 New York City, New York, IDA, Civic Facility, Calhoun School Inc. Project, Rev., FRDO, 4.25%, 09/07/00 3,000 3,400 New York City, New York, IDA, IDR, DXB Videotape Inc. Project, Rev., FRDO, 4.15%, 09/06/00 3,400 500 New York City, New York, IDA, IDR, Rev., FRDO, 4.15%, 09/06/00 500 1,500 New York City, New York, IDA, IDR, Ser. K, Rev., FRDO, 4.15%, 09/06/00 1,500 1,300 New York City, New York, Municipal Securities Trust Receipts, Ser. SG-109, GO, FRDO, 4.29%, 09/07/00 1,300 3,605 New York City, New York, Municipal Securities Trust Receipts, Ser. SGA-63, GO, FRDO, 4.35%, 09/01/00 3,605 800 New York City, New York, Municipal Securities Trust Receipts, Ser. SGB-33, GO, FRDO, 4.30%, 09/07/00 800 12,865 New York City, New York, Municipal Securities Trust Receipts, Ser. SGB-36, GO, FRDO, 4.20%, 09/07/00 12,865 1,500 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, FLOATS, Ser. PA-454, Rev., FRDO, 4.24%, 09/07/00 1,500 3,000 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, FLOATS, Ser. PT-1032, Rev., FRDO, 4.60%, 09/07/00 3,000
See notes to financial statements. 46 CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- New York -- Continued $ 9,685 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Municipal Securities Trust Receipts, Ser. SGA-12, Rev., FRDO, 4.20%, 09/06/00 $ 9,685 7,255 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Municipal Securities Trust Receipts, Ser. SGA-13, Rev., FRDO, 4.20%, 09/06/00 7,255 2,390 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Municipal Securities Trust Receipts, Ser. SGB-25, Rev., FRDO, 4.30%, 09/07/00 2,390 28,200 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Municipal Securities Trust Receipts, Ser. SGB-26, Rev., FRDO, 4.33%, 09/07/00 28,200 3,700 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Municipal Securities Trust Receipts, Ser. SGB-27, Rev., FRDO, 4.30%, 09/07/00 3,700 20,000 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Rev., 4.20%, 10/12/00 20,000 20,000 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Rev., 4.25%, 09/08/00 20,000 2,270 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Ser. A, Rev., -, 7.00%, 06/15/01 2,335 10,000 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Ser. A, Rev., FRDO, 4.35%, 09/01/00 10,000 5,000 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Ser. C, Rev., FRDO, 4.15%, 09/01/00 5,000 23,600 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Ser. C, Rev., FRDO, 4.20%, 09/01/00 23,600 18,200 New York City, New York, Municipal Water Finance Authority, Water & Sewer Systems, Ser. G, Rev., FRDO, 4.30%, 09/01/00 18,200 9,200 New York City, New York, Ser. B, GO, FRDO, 4.35%, 09/01/00 9,200 1,100 New York City, New York, Ser. B-1, Sub. Ser. B-8, GO, FRDO, 4.05%, 09/06/00 1,100 4,800 New York City, New York, Ser. B-2, Sub. Ser. B-3, GO, FRDO, 4.15%, 09/01/00 4,800 1,600 New York City, New York, Ser. B-2, Sub. Ser. B-5, GO, FRDO, 4.15%, 09/01/00 1,600 1,000 New York City, New York, Ser. F-3, GO, FRDO, 4.10%, 09/06/00 1,000 10,450 New York City, New York, Ser. F-5, GO, FRDO, 4.05%, 09/06/00 10,450
47 See notes to financial statements. CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- New York -- Continued $ 2,700 New York City, New York, Ser. J, Sub. Ser. J-2, GO, FRDO, 4.10%, 09/06/00 $ 2,700 2,300 New York City, New York, Sub. Ser. A-5, GO, FRDO, 4.15%, 09/01/00 2,300 3,000 New York City, New York, Sub. Ser. A-7, GO, FRDO, 4.30%, 09/01/00 3,000 4,100 New York City, New York, Sub. Ser. E-2, GO, FRDO, 4.30%, 09/01/00 4,100 3,000 New York City, New York, Sub. Ser. E-4, GO, FRDO, 4.30%, 09/01/00 3,000 12,350 New York City, New York, Sub. Ser. E-5, GO, FRDO, 4.30%, 09/01/00 12,350 5,000 New York City, New York, Transit Authority, Metropolitan Transportation Authority, Triborough, Floating Rate Trust Receipts, Ser. PMD-10, COP, FRDO, 4.19%, 09/07/00 5,000 29,900 New York City, New York, Transitional Finance Authority, Floating Rate Trust Receipts, Ser. A-16, Regulation D, Rev., FRDO, 4.45%, 09/01/00 29,900 35,100 New York City, New York, Transitional Finance Authority, Future Tax Secured, Ser. A-2, Rev., FRDO, 4.05%, 09/06/00 35,100 3,450 New York City, New York, Transitional Finance Authority, Municipal Securities Trust Receipts, Ser. SGA-74, Rev., FRDO, 4.35%, 09/01/00 3,450 4,995 New York City, New York, Transitional Finance Authority, PUTTERS, Ser. 129, FRDO, 4.23%, 09/07/00 4,995 5,000 New York City, New York, Transitional Finance Authority, Ser. 3, Rev., BAN, 4.75%, 11/01/00 5,005 3,700 New York City, New York, Trust Cultural Resources, American Museum of Natural History, Ser. B, Rev., FRDO, 4.10%, 09/06/00 3,700 2,672 New York City, New York, Trust Cultural Resources, Carnegie Hall, Rev., FRDO, 4.00%, 09/06/00 2,672 15,000 New York State, Dorm Authority, Floating Rate Trust Receipts, Class F, Ser. 2, Rev., FRDO, @, 4.31%, 09/07/00 15,000 9,645 New York State, Dorm Authority, FLOATS, Ser. PA-409, Rev., FRDO, 4.24%, 09/07/00 9,645 4,870 New York State, Dorm Authority, FLOATS, Ser. PA-419, Rev., FRDO, 4.24%, 09/07/00 4,870 8,425 New York State, Dorm Authority, FLOATS, Ser. PA-428, Rev., FRDO, 4.24%, 09/07/00 8,425 3,545 New York State, Dorm Authority, FLOATS, Ser. PA-449, Rev., FRDO, 4.24%, 09/07/00 3,545 4,670 New York State, Dorm Authority, FLOATS, Ser. PA-541, Rev., FRDO, 4.24%, 09/07/00 4,670 3,000 New York State, Dorm Authority, FLOATS, Ser. PA-640, Rev., FRDO, 4.24%, 09/07/00 3,000 990 New York State, Dorm Authority, FLOATS, Ser. PT-130, Rev., FRDO, 4.24%, 09/07/00 990 2,900 New York State, Dorm Authority, FLOATS, Ser. PT-1067, Rev., FRDO, 4.24%, 09/07/00 2,900 4,770 New York State, Dorm Authority, New York Public Library, Ser. A, Rev., FRDO, 4.05%, 09/06/00 4,770
See notes to financial statements. 48 CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- New York -- Continued $ 2,500 New York State, Dorm Authority, Oxford University Press Inc., Rev., FRDO, 4.20%, 09/01/00 $ 2,500 6,100 New York State, Energy Research & Development Authority, Facilities, FLOATS, Ser. PA-411, Rev., FRDO, 4.24%, 09/07/00 6,100 5,000 New York State, Energy Research & Development Authority, PCR, Annual Tender, New York State Electric & Gas, Rev., FRDO, 4.20%, 03/15/01 5,000 2,755 New York State, Energy Research & Development Authority, PCR, New York State Electric & Gas, Ser. C, Rev., FRDO, 4.20%, 09/01/00 2,755 2,260 New York State, Energy Research & Development Authority, PCR, Niagara Mohawk Power Corp. Project, Ser. A, Rev., FRDO, 4.20%, 09/01/00 2,260 2,100 New York State, Energy Research & Development Authority, PCR, Niagara Mohawk Power Corp. Project, Ser. A, Rev., FRDO, 4.35%, 09/01/00 2,100 3,700 New York State, Energy Research & Development Authority, PCR, Niagara Mohawk Power Corp., Ser. B, Rev., FRDO, 4.15%, 09/01/00 3,700 10,200 New York State, Energy Research & Development Authority, PCR, Niagara Mohawk Power Corp., Ser. C, Rev., FRDO, 4.15%, 09/01/00 10,200 3,000 New York State, Energy Research & Development Authority, PCR, Rochester Gas & Electric Corp., Ser. B, Rev., FRDO, 4.20%, 09/06/00 3,000 1,200 New York State, Environmental Facilities Corp., OFS Equity Huntington Project, Rev., FRDO, 4.25%, 09/01/00 1,200 3,675 New York State, Environmental Facilities Corp., PCR, State Water Revolving Fund, Ser. E, Rev., 6.88%, 06/15/01 3,814 4,300 New York State, Environmental Quality, Ser. G, GO, FRDO, 3.90%, 09/06/00 4,300 17,850 New York State, Housing Finance Agency, 101 West End Ave. Housing, Ser. A, Rev., FRDO, 4.30%, 09/06/00 17,850 25,000 New York State, Housing Finance Agency, 150 East 44th Street Housing, Ser. A, Rev., FRDO, 4.30%, 09/06/00 25,000 5,700 New York State, Housing Finance Agency, 345 East 94th Street Housing, Ser. A, Rev., FRDO, 4.20%, 09/06/00 5,700 29,500 New York State, Housing Finance Agency, 750 Sixth Ave. Housing, Ser. A, Rev., FRDO, 4.05%, 09/06/00 29,500 5,400 New York State, Housing Finance Agency, East 39th Street Housing, Ser. A, Rev., FRDO, 4.05%, 09/06/00 5,400 2,495 New York State, Housing Finance Agency, FLOATS, Ser. PA-143, Rev., FRDO, 4.31%, 09/07/00 2,495 1,000 New York State, Housing Finance Agency, Liberty View, Ser. A, Rev., FRDO, 4.15%, 09/06/00 1,000 3,300 New York State, Housing Finance Agency, Multi-Family Housing, Ser. A, Rev., FRDO, 4.30%, 09/06/00 3,300 5,100 New York State, Housing Finance Agency, Residential, Ser. A, Rev., FRDO, 4.30%, 09/06/00 5,100 23,000 New York State, Housing Finance Agency, Ser. A, Rev., FRDO, 4.10%, 09/06/00 23,000
See notes to financial statements. 49 CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- New York -- Continued $ 5,300 New York State, Housing Finance Agency, Service Contract Obligation, Ser. A, Rev., FRDO, 3.95%, 09/06/00 $ 5,300 10,000 New York State, Housing Finance Agency, Theatre Row Tower, Ser. A, Rev., FRDO, 4.10%, 09/06/00 10,000 20,900 New York State, Housing Finance Agency, Tribeca, Ser. A, Rev., FRDO, 4.05%, 09/06/00 20,900 21,400 New York State, Housing Finance Agency, Union Square South Housing, Rev., FRDO, 4.10%, 09/06/00 21,400 6,240 New York State, Job Development Authority, State Guaranteed, Ser. A-1 through A-21, Rev., FRDO, 4.40%, 09/01/00 6,240 5,295 New York State, Job Development Authority, State Guaranteed, Ser. A-1 through A-42, Rev., FRDO, 4.40%, 09/01/00 5,295 910 New York State, Job Development Authority, State Guaranteed, Ser. B-1 through B-9, Rev., FRDO, 4.40%, 09/01/00 910 4,670 New York State, Job Development Authority, State Guaranteed, Ser. B-1 through B-21, Rev., FRDO, 4.40%, 09/01/00 4,670 3,155 New York State, Job Development Authority, State Guaranteed, Special Purpose, Ser. A-1 through A-13, Rev., FRDO, 4.40%, 09/01/00 3,155 2,400 New York State, Job Development Authority, State Guaranteed, Special Purpose, Ser. A-1 through A-25, Rev., FRDO, 4.40%, 09/01/00 2,400 495 New York State, Job Development Authority, State Guaranteed, Special Purpose, Ser. B-1 through B-2, Rev., FRDO, 4.40%, 09/01/00 495 240 New York State, Job Development Authority, State Guaranteed, Special Purpose, Ser. B-1 Through B-9, Rev., FRDO, 4.40%, 09/01/00 240 5,800 New York State, Local Government Assistance Corp., Floating Rate Receipts, Ser. SG-99, Rev., FRDO, 4.24%, 09/07/00 5,800 20,000 New York State, Local Government Assistance Corp., FLOATS, Ser. PT-1040, Rev., FRDO, 4.60%, 09/07/00 20,000 14,400 New York State, Local Government Assistance Corp., Municipal Securities Trust Receipts, Ser. SGA-59, Rev., FRDO, 4.35%, 09/01/00 14,400 12,085 New York State, Local Government Assistance Corp., Ser. A, Rev., -, 7.25%, 04/01/01 12,529 24,880 New York State, Local Government Assistance Corp., Ser. A, Rev., FRDO, 4.00%, 09/06/00 24,880 1,030 New York State, Local Government Assistance Corp., Ser. B, Rev., -, 7.13%, 04/01/01 1,067 4,240 New York State, Local Government Assistance Corp., Ser. B, Rev., -, 7.25%, 04/01/01 4,396 7,900 New York State, Local Government Assistance Corp., Ser. B, Rev., -, 7.50%, 04/01/01 8,201 3,400 New York State, Local Government Assistance Corp., Ser. B, Rev., FRDO, 4.05%, 09/06/00 3,400
See notes to financial statements. 50 CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- New York -- Continued $ 500 New York State, Local Government Assistance Corp., Ser. F, Rev., FRDO, 4.05%, 09/06/00 $ 500 1,500 New York State, Local Government Assistance Corp., Ser. G, Rev., FRDO, 4.10%, 09/06/00 1,500 8,200 New York State, Medical Care Facilities, Finance Agency, FLOATS, Ser. PA-113, Rev., FRDO, 4.24%, 09/07/00 8,200 7,845 New York State, Medical Care Facilities, Finance Agency, FLOATS, Ser. PT-17, Rev., FRDO, 4.24%, 09/07/00 7,845 8,805 New York State, Medical Care Facilities, Finance Agency, FLOATS, Ser. PT-100, Rev., FRDO, 4.24%, 09/07/00 8,805 5,425 New York State, Medical Care Facilities, Finance Agency, FLOATS, Ser. PT-109, Rev., FRDO, 4.24%, 09/07/00 5,425 8,355 New York State, Medical Care Facilities, Finance Agency, FLOATS, Ser. PT-145A, Rev., FRDO, 4.24%, 09/07/00 8,355 3,625 New York State, Medical Care Facilities, Finance Agency, North Shore University Hospital, Rev., -, 7.20%, 11/01/00 3,716 2,500 New York State, Mortgage Agency, FLOATS, Ser. PA-628, Rev., FRDO, 4.29%, 09/07/00 2,500 11,415 New York State, Mortgage Agency, FLOATS, Ser. PA-657, Rev., FRDO, 4.24%, 09/07/00 11,415 4,140 New York State, Mortgage Agency, FLOATS, Ser. PT-217, Rev., FRDO, 4.29%, 09/07/00 4,140 5,145 New York State, Mortgage Agency, FLOATS, Ser. PT-260, Rev., FRDO, 4.60%, 09/06/00 5,145 8,190 New York State, Mortgage Agency, FLOATS, Ser. PT-322, Rev., FRDO, 4.30%, 09/07/00 8,190 6,650 New York State, Mortgage Agency, FLOATS, Ser. PT-1190, Rev., FRDO, 4.24%, 09/07/00 6,650 200 New York State, Mortgage Agency, Homeowner Mortgage, Ser. 87, Rev., 3.80%, 10/01/00 200 165 New York State, Mortgage Agency, Homeowner Mortgage, Ser. 91, Rev., 4.00%, 10/01/00 165 810 New York State, Mortgage Agency, Homeowner Mortgage, Ser. 91, Rev., 4.15%, 04/01/01 810 200 New York State, Mortgage Agency, Homeowner Mortgage, Ser. 93, Rev., 4.00%, 10/01/00 200 210 New York State, Mortgage Agency, Homeowner Mortgage, Ser. 93, Rev., 4.15%, 04/01/01 210 11,000 New York State, Power Authority, Rev., 4.00%, 09/05/00 11,000 11,800 New York State, Power Authority, Rev., 4.20%, 10/02/00 11,800 7,300 New York State, Power Authority, Rev., 4.30%, 10/02/00 7,300 2,900 New York State, Power Authority, Ser. Y, Rev., -, 6.75%, 01/01/01 2,982 17,500 New York State, Ser. A, GO, FRDO, 4.05%, 02/01/01 17,500 34,605 New York State, Thruway Authority, Floating Rate Receipts, Ser. SG-119, FRDO, 4.40%, 09/01/00 34,605 11,415 New York State, Thruway Authority, FLOATS, Ser. PA-532, Rev., FRDO, 4.24%, 09/07/00 11,415 10,000 New York State, Thruway Authority, GO, BAN, 4.20%, 10/11/00 10,000
See notes to financial statements. 51 CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- New York -- Continued $ 1,015 New York State, Thruway Authority, Municipal Securities Trust Receipts, Ser. SGA-66, Rev., FRDO, 4.20%, 09/06/00 $ 1,015 4,600 New York State, Thruway Authority, Service Contract, Local Highway & Bridge, Rev., -, 6.00%, 01/01/01 4,627 14,265 New York State, Thruway Authority, Service Contract, Local Highway & Bridge, Rev., -, 7.25%, 01/01/01 14,683 3,000 New York State, Urban Development Corp., Correctional Capital Facilities, Ser. 2, Rev., -, 7.50%, 01/01/01 3,090 3,900 New York State, Urban Development Corp., FLOATS, Ser. PA-429, Rev., FRDO, 4.24%, 09/07/00 3,900 1,000 Niagara County, New York, IDA, Solid Waste Disposal, American Refunding, Fuel Co., Ser. A, Rev., FRDO, 4.30%, 09/06/00 1,000 1,000 Niagara County, New York, IDA, Solid Waste Disposal, American Refunding, Fuel Co., Ser. B, Rev., FRDO, 4.40%, 09/06/00 1,000 4,995 Niagara Falls, New York, Bridge Commission, FLOATS, Ser. PA-530, Rev., FRDO, 4.24%, 09/07/00 4,995 9,500 Niagara Falls, New York, Bridge Commission, Ser. A, Rev., FRDO, 4.10%, 09/06/00 9,500 7,000 North Babylon, New York, Union Free School District, GO, TAN, 5.00%, 06/28/01 7,016 7,017 North Hempstead, New York, GO, BAN, 5.00%, 07/26/01 7,049 1,500 North Salem, New York, Central School District, GO, TAN, 4.75%, 02/28/01 1,503 4,000 Northern Adironadack Central School District, Ellenburg, New York, GO, BAN, 5.00%, 07/06/01 4,011 5,000 Ogdensburg, New York, Enlarged City School District, GO, RAN, 5.00%, 06/29/01 5,012 4,500 Oneonta, New York, City School District, GO, RAN, 5.00%, 06/15/01 4,508 1,780 Panama, New York, Central School District, GO, BAN, 5.00%, 08/15/01 1,786 7,800 Pawling, New York, Central School District, GO, BAN, 4.50%, 11/10/00 7,804 3,180 Port Authority of New York & New Jersey, Consolidated Bonds 117th Series, 1st Installment, Rev., 4.00%, 11/15/00 3,180 2,950 Port Authority of New York & New Jersey, Equipment Notes, Ser. 3, Rev., FRDO, 4.45%, 09/06/00 2,950 3,405 Port Authority of New York & New Jersey, FLOATS, Ser. PA-518, Rev., FRDO, 4.08%, 09/07/00 3,405 1,305 Port Jervis, New York, IDA, The Future Home Tech Inc., Rev., FRDO, 4.40%, 09/06/00 1,305 2,455 Pulaski, New York, Central School District, GO, RAN, 5.00%, 06/29/01 2,464 5,025 Riverhead, New York, Central School District, GO, TAN, 5.00%, 06/22/01 5,035 5,000 Rochester, New York, GO, BAN, 4.75%, 03/07/01 5,014 800 Rockland County, New York, IDA, IDR, X Products Corp. Project, Rev., FRDO, 4.20%, 09/07/00 800 2,290 Rockland County, New York, IDA, Shock Technical Inc. Project, Rev., FRDO, 4.30%, 09/06/00 2,290
See notes to financial statements. 52 CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- New York -- Continued $ 10,000 Rome, New York, City School District, GO, RAN, 5.00%, 06/29/01 $10,018 8,158 Rondout Valley Central School District, Accord, New York, GO, BAN, +, 4.75%, 03/15/01 8,171 4,635 Roosevelt, New York, Union Free School District, GO, TAN, 5.25%, 06/28/01 4,640 12,215 Schenectady, New York, City School District, GO, RAN, 5.50%, 06/29/01 12,239 4,500 South Colonie, New York, Central School District, GO, RAN, 5.00%, 06/29/01 4,516 2,500 South Country Central School District, Brookhaven, New York, GO, TAN, 5.00%, 06/26/01 2,508 3,954 South Jefferson, New York, Central School District, GO, RAN, 5.00%, 06/20/01 3,963 1,000 St. Lawrence County, New York, IDA, PCR, Reynolds Metals, Rev., FRDO, 4.15%, 09/01/00 1,000 8,900 Suffolk County, New York, Floating Rate Trust Receipts, Ser. A-38, Regulation D, GO, FRDO, 4.50%, 09/06/00 8,900 2,400 Suffolk County, New York, Water Authority, BAN, FRDO, 4.20%, 09/06/00 2,400 6,400 Tompkins-Seneca-Tioga, New York, Board of Cooperative Educational Services, Sole Supervisory District, GO, RAN, 5.00%, 06/29/01 6,415 14,600 Triborough Bridge & Tunnel Authority, New York, Floating Rate Trust Receipts, Ser. N-15, Regulation D, Rev., FRDO, 4.40%, 09/06/00 14,600 1,475 Triborough Bridge & Tunnel Authority, New York, FLOATS, Ser. PA-200, Rev., FRDO, 4.24%, 09/07/00 1,475 4,995 Triborough Bridge & Tunnel Authority, New York, FLOATS, Ser. PA-665, Rev., FRDO, 4.29%, 09/07/00 4,995 2,000 Triborough Bridge & Tunnel Authority, New York, General Purpose, Ser. B, Rev., 4.75%, 01/01/01 2,003 4,050 Tully, New York, Central School District, GO, RAN, 5.00%, 06/29/01 4,064 3,300 Tupper Lake, New York, Central School District, GO, BAN, 5.00%, 02/23/01 3,309 11,019 Ulster County, New York, GO, BAN, 4.50%, 11/21/00 11,026 5,790 Union Endicott, New York, Central School District, GO, BAN, 4.50%, 01/18/01 5,797 5,000 Utica, New York, City School District, GO, RAN, 5.00%, 06/26/01 5,012 6,000 VRDC/IVRC Trust, Tax Exempt, Ser. 93-C, Rev., FRDO, #, 4.20%, 09/06/00 6,000 4,150 Westchester County, New York, IDA, Civic Facility, Northern Westchester Hospital, Rev., FRDO, 4.10%, 09/06/00 4,150 5,000 William Floyd, Union Free School District, Mastics- Moriches-Shirley, GO, BAN, 5.00%, 02/22/01 5,009 1,900 Yonkers, New York, IDA, Civic Facility, Consumers Union Facility, Rev., FRDO, 4.00%, 09/06/00 1,900
See notes to financial statements. 53 CHASE VISTA NEW YORK TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ---------------------------------------------------------------------------------------- Municipal Securities - Continued - ---------------------------------------------------------------------------------------- New York -- Continued $ 8,000 Yonkers, New York, IDA, Civic Facility, Sarah Lawrence College Project, Rev., FRDO, 4.25%, 09/06/00 $ 8,000 - ---------------------------------------------------------------------------------------- Total Investments -- 100.4% $1,837,991 (Cost $1,837,991)* - ----------------------------------------------------------------------------------------
See notes to financial statements. 54 - -------------------------------------------------------------------------------- CHASE VISTA CALIFORNIA TAX FREE MONEY MARKET FUND Portfolio of Investments - -------------------------------------------------------------------------------- As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - 99.4% - ------------------------------------------------------------------------------------- California -- 90.3% $ 1,000 ABAG Finance Authority for Nonprofit Corporations, California, Multi-Family Housing, Miramar Apartments, Ser. A, Rev., FRDO, 3.60%, 09/07/00 $1,000 1,000 California Community College Financing Authority, Ser. B, Rev., TRAN, 5.00%, 08/03/01 1,007 200 California Educational Facilities Authority, Stanford University, Ser. M, Rev., 5.25%, 12/01/00 201 500 California Educational Facilities Authority, University of San Francisco, Rev., FRDO, 3.40%, 09/06/00 500 835 California Educational Facilities Authority, University of Southern California, Ser. A, Rev., 5.60%, 10/01/00 836 1,700 California Housing Finance Agency, FLOATS, Ser. PA-539R, Rev., FRDO, 3.88%, 09/07/00 1,700 900 California Housing Finance Agency, Multi-Family Housing, Ser. B, Rev., FRDO, 3.35%, 09/01/00 900 1,610 California Infrastructure & Economic Development, IDR, Pleasant Mattress Inc. Project, Ser. A, Rev., FRDO, 3.85%, 09/06/00 1,610 400 California PCFA, PCR, Shell Oil Co. Project, Ser. A, Rev., FRDO, 3.55%, 09/01/00 400 300 California PCFA, Solid Waste Disposal, Shell Oil Co. Martinez Project, Ser. A, Rev., FRDO, 3.45%, 09/01/00 300 2,000 California State, Economic Development Financing Authority, IDR, Provena Foods Inc. Project, Rev., FRDO, 3.90%, 09/06/00 2,000 1,700 California State, Economic Development Financing Authority, IDR, Standard Abrasives Manufacturing Project, Rev., FRDO, 3.85%, 09/06/00 1,700 400 California State, Economic Development Financing Authority, IDR, Volk Enterprises Inc. Project, Rev., FRDO, 3.55%, 09/07/00 400 495 California State, FLOATS, Ser. PA-464, GO, FRDO, 3.88%, 09/07/00 495 800 California State, FLOATS, Ser. PT-1070, GO, FRDO, 3.88%, 09/07/00 800 900 California State, FLOATS, Ser. PT-1072, GO, FRDO, 3.88%, 09/07/00 900 100 California State, GO, 6.60%, 10/01/00 100 2,000 California State, Municipal Securities Trust Receipts, Ser. SGA-40, GO, FRDO, 3.72%, 09/06/00 2,000 2,800 California State, Municipal Securities Trust Receipts, Ser. SGA-55, GO, FRDO, #, 3.72%, 09/06/00 2,800 1,000 California Statewide Communities Development Authority, Ser. A, Rev., TRAN, 5.25%, 06/29/01 1,008 4,000 Central Valley Schools Financing Authority, California, Ser. A-45, FRDO, 4.00%, 09/06/00 4,001 1,325 County of Riverside, Teete, California, Rev., 3.90%, 09/13/00 1,325 750 East Bay, California, Regional Park District, Ser. B, GO, -, 6.30%, 09/01/00 765 250 Eastern Municipal Water District, California, COP, -, 7.00%, 11/01/00 251
See notes to financial statements. 55 CHASE VISTA CALIFORNIA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- California -- Continued $ 1,400 Irvine Ranch, California, Water District, Consolidated Bonds, Rev., FRDO, 3.60%, 09/01/00 $1,400 700 Irvine Ranch, California, Water District, Consolidated Bonds, Rev., FRDO, 3.60%, 09/01/00 700 400 Irvine, California, Improvement Bond Act of 1915, Assessment District No. 94-15, Special Assessment, Rev., FRDO, 3.60%, 09/01/00 400 100 Los Angeles County, California, Metropolitan Transportation Authority, Proposition C, Second Ser., Ser. A, Rev., FRDO, 3.50%, 09/07/00 100 1,000 Los Angeles County, California, Schools Pooled Financing Program, Pooled Transportation, Ser. A, COP, GO, 5.00%, 07/02/01 1,006 1,000 Los Angeles, California, Harbor Department, Floating Rate Trust Receipts, Ser. 7, Class F, Rev., FRDO, 3.88%, 09/07/00 1,000 700 M-S-R Public Power Agency, California, San Juan Project, Sub-Lien, Ser. E, Rev., FRDO, 3.50%, 09/07/00 700 2,000 Metropolitan Water District, Southern California, Rev., 4.05%, 12/14/00 2,000 500 Metropolitan Water District, Southern California, Waterworks, Rev., 5.10%, 07/01/01 503 500 Metropolitan Water District, Southern California, Waterworks, Ser. B, Rev., FRDO, 3.60%, 09/07/00 500 250 Milpitas, California, Unified School District, GO, 7.50%, 09/01/00 250 200 Modesto, California, Irrigation District Financing Authority, Ser. A, Rev., 4.70%, 10/01/00 200 1,000 Monrovia, California, Unified School District, Municipal Securities Trust Receipts, Ser. SGA-70, Rev., FRDO, 3.70%, 09/06/00 1,000 1,000 Moreno Valley, California, Unified School District, TRAN, 4.75%, 08/15/01 1,007 105 Mount Diablo, California, Hospital District, Ser. A, Rev., -, 6.13%, 12/01/00 108 650 Mount Diablo, California, Unified School District, GO, TRAN,, 4.50%, 01/19/01 652 3,000 Municipal Securities Trust Certificates, Ser. 1998-47, Class A, Rev., FRDO, #, 3.80%, 09/06/00 3,000 3,290 Municipal Securities Trust Certificates, Ser. 2000-95, Class A, Rev., FRDO, #, 3.90%, 09/01/00 3,290 600 Oakland, California, GO, TRAN, 4.25%, 09/29/00 600 1,000 Oakland-Alameda County, California, Coliseum Authority, Coliseum Project, Ser. C-1, Rev., FRDO, 3.65%, 09/06/00 1,000 100 Ontario, California, Redevelopment Agency, IDR, Safariland Project, Rev., FRDO, 4.10%, 09/06/00 100 250 Orange County, California, Local Transportation Authority, Sales Tax, First Ser., Measure M, Rev., 5.50%, 02/15/01 251 2,275 Orange County, California, Sanitation Districts No. 1-3, 5-7, 11, 13 & 14, COP, FRDO, 3.60%, 09/01/00 2,275
See notes to financial statements. 56 CHASE VISTA CALIFORNIA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- California -- Continued $ 2,440 Oxnard, California, Industrial Development Financing Authority, IDR, Accurate Engineering Project, Rev., FRDO, 3.85%, 09/06/00 $2,440 1,500 Pasadena, California, Rose Bowl Improvements Project, COP, FRDO, 3.65%, 09/06/00 1,500 450 Petaluma, California, City School District, GO, TRAN, 5.00%, 07/05/01 453 400 Pleasanton, California, Multi-Family Mortgage, Valley Plaza, Ser. A, Rev., FRDO, 3.50%, 09/06/00 400 700 Riverside County, California, IDA, Design Time Inc. Project, Ser. A-I, Rev., FRDO, 3.85%, 09/06/00 700 200 Riverside County, California, Public Financing Authority, Special Tax, Menifee Village Project, Senior Lien, Ser. A, Rev., 4.00%, 09/01/00 200 800 Sacramento County, California, Multi-Family Housing, Ser. C, Rev., FRDO, 3.45%, 09/07/00 800 550 San Bernardino County, California, Housing Authority, Multi-Family Housing, Victoria Terrace Project, Ser. A, Rev., FRDO, 3.60%, 09/07/00 550 90 San Bernardino County, California, IDA, Aqua-Service, Rev., FRDO, 4.35%, 09/06/00 90 90 San Bernardino County, California, IDA, Master Halco Inc., Ser. II, Rev., FRDO, 4.10%, 09/05/00 90 2,000 San Diego County, California, GO, 3.95%, 10/05/00 2,000 700 San Diego County, California, Multi-Family Housing, Country Hills, Ser. A, Rev., FRDO, 3.50%, 09/06/00 700 1,340 San Diego, California, Area Local Government, Ser. C, COP, TRAN, 4.50%, 09/29/00 1,341 300 San Diego, California, IDR, Kaiser Aerospace & Electric, Ser. A, Rev., FRDO, 3.85%, 09/07/00 300 250 San Diego, California, Unified School District, Ser. A, GO, TRAN, 4.25%, 09/29/00 250 300 San Francisco, California, City & County, Affordable Housing, Ser. D, GO, 7.38%, 06/15/01 307 300 San Francisco, California, City & County, Redevelopment Agency, Multi-Family Housing, 3rd & Mission, Ser. C, Rev., FRDO, 3.55%, 09/06/00 300 1,000 San Juan, California, Unified School District, Ser. A-41, Rev., FRDO, 4.00%, 09/06/00 1,000 500 Santa Ana, California, Unified School District, COP, FRDO, 3.50%, 09/06/00 500 250 Santa Barbara County, California, Ser. A, GO, TRAN, 4.25%, 09/29/00 250 625 Santa Clara County-El Camino, California, Hospital District, Hospital Facilities Authority, ACES, Lease, Valley Medical Center Project, Ser. B, Rev., FRDO, 3.35%, 09/05/00 625 490 Santa Cruz County, California, Redevelopment Agency, Live Oak/Soquel Project, Tax Allocation, 4.25%, 09/01/01 491 260 Simi Valley, California, Public Financing Authority, Rev., 4.00%, 09/01/00 260 500 Solano County, California, Ser. B, GO, TRAN, 4.50%, 12/15/00 501
See notes to financial statements. 57 CHASE VISTA CALIFORNIA TAX FREE MONEY MARKET FUND Portfolio of Investments (Continued) As of August 31, 2000 (Amounts in thousands)
Principal Amount Issuer Value - ------------------------------------------------------------------------------------- Municipal Securities - Continued - ------------------------------------------------------------------------------------- California -- Continued $ 460 Sonoma Valley, California, Unified School District, GO, 10.00%, 08/01/01 $ 484 600 Three Valleys Municipal Water District, California, Miramar Water Treatment, COP, FRDO, 3.70%, 09/06/00 600 122 Tustin, California, Improvement Bond Act of 1915, Reassessment District No. 95-2-A, Special Assessment, FRDO, 3.60%, 09/01/00 122 300 Union Sanitation District, California, Financing Authority, Sewer, Rev., 5.10%, 10/01/00 300 425 Upland, California, Community Redevelopment Agency, Multi-Family Housing, Northwoods Project, Ser. 168-A, Rev., FRDO, 3.75%, 09/07/00 425 1,500 Vacaville, California, Multi-Family Mortgage, Quail Run, Ser. A, Rev., 3.50%, 09/06/00 1,500 850 West Contra Costa, California, Unified School District, Rev., TRAN, 4.50%, 12/06/00 851 600 Western Riverside County, California, Regional Wastewater Authority, Regional Wastewater Treatment, Rev., FRDO, 3.60%, 09/01/00 600 ------- 69,971 Puerto Rico -- 9.0% 1,000 Municipal Securities Trust Certificates, Ser. 2000-91, Class A, Rev., FRDO, #, 3.90%, 09/01/00 1,000 600 Puerto Rico Commonwealth, FLOATS, Ser. PA-472, GO, FRDO, 3.88%, 09/07/00 600 1,000 Puerto Rico Commonwealth, FLOATS, Ser. PA-625, GO, FRDO, 3.88%, 09/07/00 1,000 1,000 Puerto Rico Commonwealth, FLOATS, Ser. PT-1025, GO, FRDO, 4.05%, 09/07/00 1,000 1,344 Puerto Rico Government Development Bank, 4.00%, 01/09/01 1,344 2,000 Puerto Rico Government Development Bank, 4.00%, 01/31/01 2,000 ------- 6,944 Virgin Islands -- 0.1% 100 Virgin Islands Public Finance Authority, Ser. A, Rev., -, 7.30%, 10/01/00 101 ---------------------------------------------------------- ------- Total Investments -- 99.4% $77,016 (Cost $77,016)* ----------------------------------------------------------
See notes to financial statements. 58 CHASE VISTA FUNDS Portfolio of Investments (Continued) As of August 31, 2000 INDEX: * -- The cost of securities is substantially the same for federal income tax purposes. # -- Security may only be sold to qualified institutional buyers. - - -- Security is prerefunded or escrowed to maturity. The maturity date shown is the date of the prerefunded call. + -- When issued or delayed delivery security. @ -- All or portion of this security is segregated for when issued or delayed delivery securities. ACES -- Auction Rate Securities. BAN -- Bond Anticipation Notes. COP -- Certificates of Participation. DN -- Discount Note. The rate shown is the effective yield at the date of purchase. Eagles -- Earnings of accrual generated on local exempt securities. ECN -- Extendible Commercial Note. The maturity date shown is the call date. The interest rate shown is the effective yield at the date of purchase. FHLMC -- Federal Home Loan Mortgage Corporation. FLOATS -- Floating Auction Tax Exempts. FRDO -- Floating Rate Demand Obligation. The maturity date shown is the next interest reset date. The interest rate shown is the rate in effect at August 31, 2000. FRN -- Floating Rate Note. The maturity date shown is the actual maturity date. The rate shown is the rate in effect at August 31, 2000. GIC -- Guaranteed Insurance Contract. GO -- General Obligation. IDA -- Industrial Development Authority. IDR -- Industrial Development Revenue. MTN -- Medium Term Note. PCFA -- Pollution Control Financing Authority. PCR -- Pollution Control Revenue. PUTTERS -- Putable Tax Exempt Receipts. RAN -- Revenue Anticipation Notes. Rev. -- Revenue Bond. Ser. -- Series. SUB -- Step-Up Bond. The maturity date shown is the call date. The interest rate shown is the rate in effect at August 31, 2000. TAN -- Tax Anticipation Notes. TRAN -- Tax & Revenue Anticipation Notes. USTR -- United States Treasury Notes, Bonds and Bills. See notes to financial statements. 59 - -------------------------------------------------------------------------------- STATEMENT OF ASSETS AND LIABILITIES August 31, 2000 - -------------------------------------------------------------------------------- (Amounts in Thousands, Except Per Share Amounts)
100% U.S. Treasury U.S. Securities Government Treasury Plus Money Market Money Market Money Market Fund Fund Fund - ------------------------------------------------------------------------------------------- ASSETS: Investment securities, at value (Note 1) .............................. $4,500,876 $7,235,019 $2,505,035 Cash .................................. -- 33 1 Other assets .......................... 31 48 17 Receivables: Investment securities sold ........... 1,492,428 -- 497,101 Interest ............................. 33,490 63,860 354 Fund shares sold ..................... -- 113 -- - ------------------------------------------------------------------------------------------- Total Assets ....................... 6,026,825 7,299,073 3,002,508 - ------------------------------------------------------------------------------------------- LIABILITIES: Payables: Investment securities purchased 1,496,252 100,000 498,751 Fund shares redeemed ................. 615 5,945 76 Dividends ............................ 4,481 18,117 3,357 Accrued liabilities: (Note 2) Investment advisory fees ............. 392 620 215 Administration fees .................. 235 434 129 Shareholder servicing fees ........... 1,112 1,225 373 Distribution fees .................... 69 367 111 Custody fees ......................... 63 99 36 Other ................................ 995 1,692 535 - ------------------------------------------------------------------------------------------- Total Liabilities .................. 1,504,214 128,499 503,583 - ------------------------------------------------------------------------------------------- NET ASSETS: Paid in capital ....................... 4,522,720 7,170,601 2,498,979 Accumulated undistributed (distributions in excess of) net investment income ..................... (119) (7) (60) Accumulated net realized gain (loss) on investment transactions ..... 10 (20) 6 - ------------------------------------------------------------------------------------------- Net Assets ......................... $4,522,611 $7,170,574 $2,498,925 - ------------------------------------------------------------------------------------------- Shares of beneficial interest outstanding ($.001 par value; unlimited number of shares authorized) Vista Shares .......................... 3,535,228 3,398,198 1,367,009 Premier Shares ........................ 115,844 1,134,019 228,106 Institutional Shares .................. 871,705 2,638,437 903,945 Net asset value, offering and redemption price per share (all classes) .......................... $ 1.00 $ 1.00 $ 1.00 - ------------------------------------------------------------------------------------------- Cost of investments .................... $4,500,876 $7,235,019 $2,505,035 - -------------------------------------------------------------------------------------------
See notes to financial statements. 60 STATEMENT OF ASSETS AND LIABILITIES August 31, 2000 (Amounts in Thousands, Except Per Share Amounts)
Federal Cash Prime Money Market Management Money Market Fund Fund Fund - ------------------------------------------------------------------------------------------- ASSETS: Investment securities, at value (Note 1) ............................ $1,138,779 $11,023,038 $13,044,137 Cash ................................ -- 1,310 285 Other assets ........................ 7 71 71 Receivables: Interest ........................... 6,078 65,028 59,962 Fund shares sold ................... 67 2,480 -- - ------------------------------------------------------------------------------------------- Total Assets ..................... 1,144,931 11,091,927 13,104,455 - ------------------------------------------------------------------------------------------- LIABILITIES: Payables: Investment securities purchased -- -- 325,236 Fund shares redeemed ............... 9 4,191 160 Dividends .......................... 1,738 6,948 16,573 Accrued liabilities: (Note 2) Investment advisory fees ........... 96 926 1,032 Administration fees ................ 96 834 929 Shareholder servicing fees ......... 225 2,260 1,020 Distribution fees .................. 48 -- 7 Custody fees ....................... 24 34 98 Other .............................. 541 2,157 2,098 - ------------------------------------------------------------------------------------------- Total Liabilities ................ 2,777 17,350 347,153 - ------------------------------------------------------------------------------------------- NET ASSETS: Paid in capital ..................... 1,142,234 11,075,522 12,757,495 Accumulated undistributed (distributions in excess of) net investment income ................... (48) (85) (131) Accumulated net realized loss on investment transactions .......... (32) (860) (62) - ------------------------------------------------------------------------------------------- Net Assets ....................... $1,142,154 $11,074,577 $12,757,302 - ------------------------------------------------------------------------------------------- Shares of beneficial interest outstanding ($.001 par value; unlimited number of shares authorized) Vista Shares ........................ 576,606 7,345,958 1,478,706 Premier Shares ...................... 278,840 425,636 1,841,212 Institutional Shares ................ 286,779 3,303,869 9,426,519 Reserve Shares ...................... 1 -- 1 B Shares* ........................... -- -- 10,941 C Shares* ........................... -- -- 44 Net asset value, offering and redemption price per share (all classes) ........................ $ 1.00 $ 1.00 $ 1.00 - ------------------------------------------------------------------------------------------- Cost of investments .................. $1,138,779 $11,023,038 $13,044,137 - -------------------------------------------------------------------------------------------
*Redemption price may be reduced by contingent deferred sales charge. See notes to financial statements. 61 STATEMENT OF ASSETS AND LIABILITIES August 31, 2000 (Amounts in Thousands, Except Per Share Amounts)
New York California Tax Free Tax Free Tax Free Money Market Money Market Money Market Fund Fund Fund - ------------------------------------------------------------------------------------------- ASSETS: Investment securities, at value (Note 1) ............................ $1,658,436 $1,837,991 $77,016 Cash ................................ 2,417 7 16 Other assets ........................ 12 12 1 Receivables: Interest ........................... 11,886 14,074 711 Fund shares sold ................... 8 287 1 - ------------------------------------------------------------------------------------------- Total Assets ..................... 1,672,759 1,852,371 77,745 - ------------------------------------------------------------------------------------------- LIABILITIES: Payables: Investment securities purchased 14,020 18,230 -- Fund shares redeemed ............... -- 60 -- Dividends .......................... 2,656 1,584 137 Accrued liabilities: (Note 2) Investment advisory fees ........... 143 155 6 Administration fees ................ 143 78 6 Shareholder servicing fees ......... 204 544 10 Distribution fees .................. 75 62 3 Custody fees ....................... 38 23 17 Other .............................. 816 423 47 - ------------------------------------------------------------------------------------------- Total Liabilities ................ 18,095 21,159 226 - ------------------------------------------------------------------------------------------- NET ASSETS: Paid in capital ..................... 1,655,095 1,831,154 77,536 Accumulated undistributed (distributions in excess of) net investment income ............... 23 60 (3) Accumulated net realized loss on investment transactions .......... (454) (2) (14) - ------------------------------------------------------------------------------------------- Net Assets ....................... $1,654,664 $1,831,212 $77,519 - ------------------------------------------------------------------------------------------- Shares of beneficial interest outstanding ($.001 par value; unlimited number of shares authorized) .......................... Vista Shares ........................ 894,544 1,831,255 77,535 Premier Shares ...................... 119,999 -- -- Institutional Shares ................ 640,573 -- -- Reserve Shares ...................... 1 1 -- Net asset value, offering and redemption price per share (all classes) ........................ $ 1.00 $ 1.00 $ 1.00 - ------------------------------------------------------------------------------------------- Cost of investments .................. $1,658,436 $1,837,991 $77,016 - -------------------------------------------------------------------------------------------
See notes to financial statements. 62 - -------------------------------------------------------------------------------- STATEMENT OF OPERATIONS For the year ended August 31, 2000 - -------------------------------------------------------------------------------- (Amounts in Thousands)
100% U.S. Treasury U.S. Securities Government Treasury Plus Money Market Money Market Money Market Fund Fund Fund - ------------------------------------------------------------------------------------------- INTEREST INCOME: (Note 1C) ............... $237,313 $433,744 $155,272 - ------------------------------------------------------------------------------------------- EXPENSES: (Note 2) Investment advisory fees ................ 4,308 7,316 2,714 Administration fees ..................... 4,308 7,316 2,714 Shareholder servicing fees .............. 12,816 17,899 6,982 Distribution fees ....................... 3,359 4,681 1,505 Custodian fees .......................... 317 501 237 Printing and postage .................... 44 44 28 Professional fees ....................... 138 204 98 Registration expenses ................... 947 530 813 Transfer agent fees ..................... 677 736 222 Trustees' fees .......................... 215 366 136 Other ................................... 54 84 84 - ------------------------------------------------------------------------------------------- Total expenses ........................ 27,183 39,677 15,533 - ------------------------------------------------------------------------------------------- Less amounts waived (Note 2E) ........... 4,777 6,694 2,854 Less earnings credits (Note 2F) ......... 35 81 122 - ------------------------------------------------------------------------------------------- Net expenses .......................... 22,371 32,902 12,557 - ------------------------------------------------------------------------------------------- Net investment income ................. 214,942 400,842 142,715 - ------------------------------------------------------------------------------------------- REALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain on investment transactions ................. 183 25 7 - ------------------------------------------------------------------------------------------- Net increase in net assets from operations .............................. $215,125 $400,867 $142,722 - -------------------------------------------------------------------------------------------
See notes to financial statements. 63 - -------------------------------------------------------------------------------- STATEMENT OF OPERATIONS For the year ended August 31, 2000 - -------------------------------------------------------------------------------- (Amounts in Thousands)
Federal Cash Prime Money Market Management Money Market Fund Fund Fund - ------------------------------------------------------------------------------------------- INTEREST INCOME: (Note 1C) ............... $66,574 $578,841 $649,782 - ------------------------------------------------------------------------------------------- EXPENSES: (Note 2) Investment advisory fees ................ 1,136 9,412 10,633 Administration fees ..................... 1,136 9,412 10,633 Shareholder servicing fees .............. 2,980 26,121 15,284 Distribution fees ....................... 570 -- 166 Custodian fees .......................... 123 424 618 Printing and postage .................... 12 84 134 Professional fees ....................... 64 288 304 Registration expenses ................... 90 1,492 1,507 Transfer agent fees ..................... 481 1,937 481 Trustees' fees .......................... 57 471 534 Other ................................... 7 265 262 - ------------------------------------------------------------------------------------------- Total expenses ........................ 6,656 49,906 40,556 - ------------------------------------------------------------------------------------------- Less amounts waived (Note 2E) ........... 486 3,201 6,582 Less earnings credits (Note 2F) ......... 46 155 129 - ------------------------------------------------------------------------------------------- Net expenses .......................... 6,124 46,550 33,845 - ------------------------------------------------------------------------------------------- Net investment income ................. 60,450 532,291 615,937 - ------------------------------------------------------------------------------------------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized loss on investment transactions ................. (24) (247) (60) Change in net unrealized appreciation/depreciation of investments .......................... -- 1,650 3,884 - ------------------------------------------------------------------------------------------- Net realized and unrealized gain (loss) on investments ................... (24) 1,403 3,824 - ------------------------------------------------------------------------------------------- Net increase in net assets from operations .............................. $60,426 $533,694 $619,761 - -------------------------------------------------------------------------------------------
See notes to financial statements. 64 STATEMENT OF OPERATIONS For the year ended August 31, 2000 (Amounts in Thousands)
New York California Tax Free Tax Free Tax Free Money Market Money Market Money Market Fund Fund Fund - ------------------------------------------------------------------------------------------- INTEREST INCOME: (Note 1C) ............... $61,421 $63,637 $2,260 - ------------------------------------------------------------------------------------------- EXPENSES: (Note 2) Investment advisory fees ................ 1,565 1,664 63 Administration fees ..................... 1,565 1,664 63 Shareholder servicing fees .............. 3,876 5,824 221 Distribution fees ....................... 843 1,664 63 Custodian fees .......................... 215 202 82 Printing and postage .................... 65 38 1 Professional fees ....................... 77 71 29 Registration expenses ................... 852 20 2 Transfer agent fees ..................... 213 378 34 Trustees' fees .......................... 78 83 3 Other ................................... 106 66 7 - ------------------------------------------------------------------------------------------- Total expenses ........................ 9,455 11,674 568 - ------------------------------------------------------------------------------------------- Less amounts waived (Note 2E) ........... 2,046 1,782 212 Less earnings credits (Note 2F) ......... 171 74 8 - ------------------------------------------------------------------------------------------- Net expenses .......................... 7,238 9,818 348 - ------------------------------------------------------------------------------------------- Net investment income ................. 54,183 53,819 1,912 - ------------------------------------------------------------------------------------------- REALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on investment transactions .............. (60) 60 -- - ------------------------------------------------------------------------------------------- Net increase in net assets from operations .............................. $54,123 $53,879 $1,912 - -------------------------------------------------------------------------------------------
See notes to financial statements. 65 - -------------------------------------------------------------------------------- STATEMENT OF CHANGES IN NET ASSETS For the year ended August 31, - -------------------------------------------------------------------------------- (Amounts in Thousands)
100% U.S. Treasury Securities U.S. Government Money Market Money Market Fund Fund 2000 1999 2000 1999 - ------------------------------------------------------------------------------------------------------- INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS: Net investment income ........... $ 214,942 $ 187,621 $ 400,842 $ 335,206 Net realized gain on investments .................. 183 2,072 25 27 - ------------------------------------------------------------------------------------------------------- Increase in net assets from operations ................ 215,125 189,693 400,867 335,233 - ------------------------------------------------------------------------------------------------------- DISTRIBUTIONS TO SHAREHOLDERS FROM: Net investment income ........... (214,925) (187,727) (400,848) (335,181) Net realized gain on investment transactions ......... (200) (2,956) -- -- - ------------------------------------------------------------------------------------------------------- Total distributions to shareholders ................... (215,125) (190,683) (400,848) (335,181) - ------------------------------------------------------------------------------------------------------- INCREASE (DECREASE) FROM CAPITAL SHARE TRANSACTIONS: # Proceeds from shares issued Vista Shares ................... 12,269,163 13,705,921 21,070,138 16,404,385 Premier Shares ................. 398,033 152,506 7,472,951 7,944,261 Institutional Shares ........... 5,690,875 5,004,382 24,558,779 23,799,456 - ------------------------------------------------------------------------------------------------------- 18,358,071 18,862,809 53,101,868 48,148,102 - ------------------------------------------------------------------------------------------------------- Proceeds from reinvestment of dividends Vista Shares ................... 127,472 112,062 99,652 74,078 Premier Shares ................. 3,353 1,084 30,191 25,108 Institutional Shares ........... 32,950 27,526 78,208 79,090 - ------------------------------------------------------------------------------------------------------- 163,775 140,672 208,051 178,276 - ------------------------------------------------------------------------------------------------------- Cost of shares redeemed Vista Shares ................... (12,174,395) (13,555,840) (21,310,059) (15,973,405) Premier Shares ................. (309,408) (151,462) (7,291,128) (8,130,974) Institutional Shares ........... (5,746,903) (5,932,433) (24,911,228) (23,763,028) - ------------------------------------------------------------------------------------------------------- (18,230,706) (19,639,735) (53,512,415) (47,867,407) - ------------------------------------------------------------------------------------------------------- Net increase (decrease) from capital share transactions ................... 291,140 (636,254) (202,496) 458,971 - ------------------------------------------------------------------------------------------------------- Total increase (decrease) in net assets ........................ 291,140 (637,244) (202,477) 459,023 NET ASSETS: Beginning of period ............. 4,231,471 4,868,715 7,373,051 6,914,028 - ------------------------------------------------------------------------------------------------------- End of period ................... $ 4,522,611 $ 4,231,471 $ 7,170,574 $ 7,373,051 - -------------------------------------------------------------------------------------------------------
# At $1.00 per share. See notes to financial statements. 66 STATEMENT OF CHANGES IN NET ASSETS For the year ended August 31, (Amounts in Thousands)
Treasury Plus Federal Money Market Money Market Fund Fund 2000 1999 2000 1999 - ------------------------------------------------------------------------------------------------------- INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS: Net investment income ........... $ 142,715 $ 125,763 $ 60,450 $ 46,821 Net realized gain (loss) on investments .................. 7 789 (24) 95 - ------------------------------------------------------------------------------------------------------- Increase in net assets from operations ................ 142,722 126,552 60,426 46,916 - ------------------------------------------------------------------------------------------------------- DISTRIBUTIONS TO SHAREHOLDERS FROM: Net investment income ........... (142,713) (125,782) (60,450) (46,814) Net realized gain on investment transactions ......... (62) (798) -- (112) - ------------------------------------------------------------------------------------------------------- Total distributions to shareholders ................... (142,775) (126,580) (60,450) (46,926) - ------------------------------------------------------------------------------------------------------- INCREASE (DECREASE) FROM CAPITAL SHARE TRANSACTIONS: # Proceeds from shares issued Vista Shares ................... 10,985,282 13,476,115 1,370,953 1,297,509 Premier Shares ................. 2,838,587 2,362,876 373,817 372,508 Institutional Shares ........... 9,562,850 12,537,826 2,941,384 3,327,807 Reserve Shares* ................ -- -- 1 -- - ------------------------------------------------------------------------------------------------------- 23,386,719 28,376,817 4,686,155 4,997,824 - ------------------------------------------------------------------------------------------------------- Proceeds from reinvestment of dividends Vista Shares ................... 54,114 41,118 22,852 18,183 Premier Shares ................. 5,041 3,990 13,241 11,931 Institutional Shares ........... 36,706 35,134 4,454 5,462 Reserve Shares* ................ -- -- -- -- - ------------------------------------------------------------------------------------------------------- 95,861 80,242 40,547 35,576 - ------------------------------------------------------------------------------------------------------- Cost of shares redeemed Vista Shares ................... (11,406,802) (13,099,202) (1,367,229) (1,124,759) Premier Shares ................. (3,091,819) (2,046,068) (406,427) (399,355) Institutional Shares ........... (9,674,902) (12,469,834) (2,907,355) (3,282,935) Reserve Shares* ................ -- -- -- -- - ------------------------------------------------------------------------------------------------------- (24,173,523) (27,615,104) (4,681,011) (4,807,049) - ------------------------------------------------------------------------------------------------------- Net increase (decrease) from capital share transactions ................... (690,943) 841,955 45,691 226,351 - ------------------------------------------------------------------------------------------------------- Total increase (decrease) in net assets .................... (690,996) 841,927 45,667 226,341 NET ASSETS: Beginning of period ............. 3,189,921 2,347,994 1,096,487 870,146 - ------------------------------------------------------------------------------------------------------- End of period ................... $ 2,498,925 $ 3,189,921 $1,142,154 $1,096,487 - -------------------------------------------------------------------------------------------------------
# At $1.00 per share. * Reserve Shares commencement of offering, 7/31/00. See notes to financial statements. 67 STATEMENT OF CHANGES IN NET ASSETS For the year ended August 31, (Amounts in Thousands)
Prime Cash Management Money Market Fund Fund 2000 1999 2000 1999 - -------------------------------------------------------------------------------------------------------------------------------- INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS: Net investment income .................................. $ 532,291 $ 317,595 $ 615,937 $ 382,831 Net realized gain (loss) on investments ......................................... (247) (329) (60) 327 Change in net unrealized appreciation/depreciation of investments ......................................... 1,650 (1,650) 3,884 (3,884) - -------------------------------------------------------------------------------------------------------------------------------- Increase in net assets from operations ....................................... 533,694 315,616 619,761 379,274 - -------------------------------------------------------------------------------------------------------------------------------- DISTRIBUTIONS TO SHAREHOLDERS FROM: Net investment income .................................. (532,279) (317,818) (615,944) (382,895) Net realized gain on investment transactions ................................ -- (117) (121) (271) - -------------------------------------------------------------------------------------------------------------------------------- Total distributions to shareholders .......................................... (532,279) (317,935) (616,065) (383,166) - -------------------------------------------------------------------------------------------------------------------------------- INCREASE (DECREASE) FROM CAPITAL SHARE TRANSACTIONS: # Proceeds from shares issued Vista Shares* ......................................... 29,721,636 26,474,726 7,131,346 1,051,476 Premier Shares ........................................ 4,224,828 4,894,950 13,034,051 11,380,971 Institutional Shares .................................. 15,577,944 10,132,124 82,896,178 61,694,665 Reserve Shares** ...................................... -- -- 1 -- B Shares .............................................. -- -- 135,290 143,459 C Shares .............................................. -- -- 7,817 4,653 - -------------------------------------------------------------------------------------------------------------------------------- 49,524,408 41,501,800 103,204,683 74,275,224 - -------------------------------------------------------------------------------------------------------------------------------- Proceeds from reinvestment of dividends Vista Shares* ......................................... 301,792 187,928 39,797 4,244 Premier Shares ........................................ 19,160 16,857 37,777 24,988 Institutional Shares .................................. 138,122 63,365 352,349 229,886 Reserve Shares** ...................................... -- -- -- -- B Shares .............................................. -- -- 806 771 C Shares .............................................. -- -- 8 5 - -------------------------------------------------------------------------------------------------------------------------------- 459,074 268,150 430,737 259,894 - -------------------------------------------------------------------------------------------------------------------------------- Cost of shares redeemed Vista Shares* ......................................... (28,358,265) (24,623,550) (6,207,576) (540,581) Premier Shares ........................................ (4,280,942) (4,864,551) (12,325,229) (10,901,491) Institutional Shares .................................. (13,959,695) (9,707,967) (81,986,141) (58,482,409) Reserve Shares** ...................................... -- -- -- -- B Shares .............................................. -- -- (161,484) (136,601) C Shares .............................................. -- -- (7,925) (4,584) - -------------------------------------------------------------------------------------------------------------------------------- (46,598,902) (39,196,068) (100,688,355) (70,065,666) - -------------------------------------------------------------------------------------------------------------------------------- Net increase from capital share transactions .......................................... 3,384,580 2,573,882 2,947,065 4,469,452 - -------------------------------------------------------------------------------------------------------------------------------- Total increase in net assets ........................................... 3,385,995 2,571,563 2,950,761 4,465,560 NET ASSETS: Beginning of period .................................... 7,688,582 5,117,019 9,806,541 5,340,981 - -------------------------------------------------------------------------------------------------------------------------------- End of period .......................................... $11,074,577 $ 7,688,582 $ 12,757,302 $ 9,806,541 - --------------------------------------------------------------------------------------------------------------------------------
# At $1.00 per share. * PRM Vista Shares commencement of offering, 10/1/98. ** Reserve Shares commencement of offering, 7/31/00. See notes to financial statements. 68 STATEMENT OF CHANGES IN NET ASSETS For the year ended August 31, (Amounts in Thousands)
Tax Free New York Tax Free Money Market Money Market Fund Fund 2000 1999 2000 1999 - ------------------------------------------------------------------------------------------------- INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS: Net investment income ......... $ 54,183 $ 36,759 $ 53,819 $ 37,793 Net realized gain (loss) on investments ................ (60) 59 60 61 - ------------------------------------------------------------------------------------------------- Increase in net assets from operations .............. 54,123 36,818 53,879 37,854 - ------------------------------------------------------------------------------------------------- DISTRIBUTIONS TO SHAREHOLDERS FROM: Net investment income ......... (54,097) (36,827) (53,800) (37,841) - ------------------------------------------------------------------------------------------------- INCREASE (DECREASE) FROM CAPITAL SHARE TRANSACTIONS: # Proceeds from shares issued Vista Shares ................. 2,078,075 2,100,524 3,464,112 3,260,482 Premier Shares ............... 343,481 385,299 -- -- Institutional Shares ......... 3,019,983 2,526,660 -- -- Reserve Shares* .............. 1 -- 1 -- - ------------------------------------------------------------------------------------------------- 5,441,540 5,012,483 3,464,113 3,260,482 - ------------------------------------------------------------------------------------------------- Proceeds from reinvestment of dividends Vista Shares ................. 12,007 8,397 37,398 25,347 Premier Shares ............... 2,982 2,257 -- -- Institutional Shares ......... 9,475 5,196 -- -- Reserve Shares* .............. -- -- -- -- - ------------------------------------------------------------------------------------------------- 24,464 15,850 37,398 25,347 - ------------------------------------------------------------------------------------------------- Cost of shares redeemed Vista Shares ................. (1,949,740) (2,088,092) (3,174,889) (3,153,158) Premier Shares ............... (356,488) (390,878) -- -- Institutional Shares ......... (2,865,404) (2,465,756) -- -- Reserve Shares* .............. -- -- -- -- - ------------------------------------------------------------------------------------------------- (5,171,632) (4,944,726) (3,174,889) (3,153,158) - ------------------------------------------------------------------------------------------------- Net increase from capital share transactions ................. 294,372 83,607 326,622 132,671 - ------------------------------------------------------------------------------------------------- Total increase in net assets ............... 294,398 83,598 326,701 132,684 - ------------------------------------------------------------------------------------------------- NET ASSETS: Beginning of period ........... 1,360,266 1,276,668 1,504,511 1,371,827 - ------------------------------------------------------------------------------------------------- End of period ................. $1,654,664 $1,360,266 $1,831,212 $1,504,511 - -------------------------------------------------------------------------------------------------
# At $1.00 per share. * Reserve Shares commencement of offering, 7/31/00. See notes to financial statements. 69 STATEMENT OF CHANGES IN NET ASSETS For the year ended August 31, (Amounts in Thousands)
California Tax Free Money Market Fund 2000 1999 - ------------------------------------------------------------------------------------------------- INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS: Net investment income ...................................... $ 1,912 $ 1,181 Net realized gain on investments ........................... -- 4 - ------------------------------------------------------------------------------------------------- Increase in net assets from operations .................... 1,912 1,185 - ------------------------------------------------------------------------------------------------- DISTRIBUTIONS TO SHAREHOLDERS FROM: Net investment income ...................................... (1,912) (1,200) - ------------------------------------------------------------------------------------------------- INCREASE (DECREASE) FROM CAPITAL SHARE TRANSACTIONS: # Proceeds from shares issued (Vista Shares) ................. 243,038 329,610 Proceeds from reinvestment of dividends (Vista Shares) ..... 732 474 Cost of shares redeemed (Vista Shares) ..................... (233,891) (312,828) - ------------------------------------------------------------------------------------------------- Net increase from capital share transactions .............. 9,879 17,256 - ------------------------------------------------------------------------------------------------- Total increase in net assets ............................. 9,879 17,241 NET ASSETS: Beginning of period ........................................ 67,640 50,399 - ------------------------------------------------------------------------------------------------- End of period .............................................. $ 77,519 $ 67,640 - -------------------------------------------------------------------------------------------------
# At $1.00 per share. See notes to financial statements. 70 - -------------------------------------------------------------------------------- CHASE VISTA FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- 1. Organization and Significant Accounting Policies Mutual Fund Trust (the "Trust") was organized as a Massachusetts business trust, and is registered under the Investment Company Act of 1940, as amended (the "1940 Act"), as an open-end, management investment company. 100% U.S. Treasury Securities Money Market Fund ("USTS"), U.S. Government Money Market Fund ("USG"), Treasury Plus Money Market Fund ("TP"), Federal Money Market Fund ("FED"), Cash Management Fund ("CM"), Prime Money Market Fund ("PRM"), Tax Free Money Market Fund ("TF"), New York Tax Free Money Market Fund ("NYTF") and California Tax Free Money Market Fund ("CTF") (collectively, the "Funds") are nine separate portfolios of the Trust. The Funds offer various classes of shares as follows:
Fund Classes Offered - -------------------------------------------------------------------------------- USTS Vista, Premier, Institutional USG Vista, Premier, Institutional TP Vista, Premier, Institutional FED Vista, Premier, Institutional, Reserve CM Vista, Premier, Institutional PRM Vista, Premier, Institutional, Reserve, B Shares, C Shares TF Vista, Premier, Institutional, Reserve NYTF Vista, Reserve CTF Vista
All classes of shares have equal rights as to earnings, assets and voting privileges except that each class may bear different transfer agent, distribution and shareholder servicing expenses, and each class has exclusive voting rights with respect to its distribution plan and shareholder servicing agreement. The following is a summary of significant accounting policies followed by the Funds: The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates. A. Valuation of investments -- Money market instruments are valued at amortized cost which approximates market value. The Trust's use of amortized cost is subject to the Trust's compliance with certain conditions as specified under Rule 2a-7 of the 1940 Act. B. Repurchase and reverse repurchase agreements -- It is each Fund's policy that repurchase agreements are fully collateralized by U.S. Treasury and Government Agency securities. All collateral is held by the Fund's custodian bank, subcustodian or a bank in which the custodian bank has entered into a subcustodian agreement or is segregated in the Federal Reserve Book Entry System. If the seller of a repurchase agreement defaults and the value of the collateral declines, or if the seller enters into an insolvency proceeding, realization of the collateral may be delayed or limited. At all times that a reverse repurchase agreement is outstanding, the Fund segregates assets with a value at least equal to its obligation under the 71 CHASE VISTA FUNDS NOTES TO FINANCIAL STATEMENTS (continued) agreement. In the event the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes insolvent, the Fund's use of proceeds from the agreement may be restricted pending a determination by the other party, or its trustee or receiver, whether to enforce the Fund's obligation to repurchase the securities. The Fund's use of the proceeds of the reverse repurchase agreement may also effectively be restricted pending such decisions. During the year ended August 31, 2000, CM entered into one reverse repurchase agreement amounting to $90,000,000 at 6.48%. Interest expense totaled $47,142, which is included in Other expenses on the statement of operations. The agreement, which matured June 19, 2000, was collateralized by Federal Home Loan Bank notes with a par value of $87,300,000, due December 1, 2000. C. Security transactions and investment income -- Investment transactions are accounted for on the trade date (the date the order to buy or sell is executed). Securities gains and losses are calculated on the identified cost basis. Interest income consists of coupon interest accrued and amortization of premium and discount earned. D. Federal income taxes -- Each Fund is treated as a separate taxable entity for Federal income tax purposes. The Fund's policy is to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute to shareholders all of its distributable net income, including net realized gain on investments. In addition, the Fund intends to make distributions as required to avoid excise taxes. Accordingly, no provision for Federal income or excise tax is necessary. E. Distributions to shareholders -- Dividends and distributions paid to shareholders are recorded on the ex-dividend date. The amount of dividends and distributions from net investment income and net realized capital gains is determined in accordance with Federal income tax regulations, which may differ from generally accepted accounting principles. To the extent these "book/tax" differences are permanent in nature (i.e., that they result from other than timing of recognition--"temporary differences"), such amounts are reclassified within the capital accounts based on their Federal income tax-basis treatment. Dividends and distributions which exceed net investment income or net realized capital gains for financial reporting purposes but not for tax purposes are reported as distributions in excess of net investment income or net realized capital gains. F. Income and Expenses -- Expenses directly attributable to a Fund are charged to that Fund; other expenses are allocated proportionately among each of the Funds within the Trust in relation to the net assets of each Fund or on another reasonable basis. Expenses directly attributable to a particular class are charged directly to such class. In calculating net asset value per share of each class, investment income, realized and unrealized gains and losses and expenses other than class specific expenses (e.g. transfer agent fees), are allocated daily to each class of shares based upon the proportion of net assets of each class at the beginning of each day. 72 CHASE VISTA FUNDS NOTES TO FINANCIAL STATEMENTS (continued) 2. Fees and Other Transactions with Affiliates A. Investment advisory fee -- Pursuant to separate Investment Advisory Agreements, The Chase Manhattan Bank ("Chase" or "Adviser") acts as the investment adviser to the Funds. Chase is a direct wholly-owned subsidiary of The Chase Manhattan Corporation. As investment adviser, Chase supervises the investments of each Fund and for such services is paid a fee. The fee is accrued daily and paid monthly at an annual rate equal to 0.10% of the average daily net assets for each respective Fund. The Adviser voluntarily waived fees as outlined in Note 2.E. below. Chase Asset Management, Inc. ("CAM"), a registered investment adviser, is the sub-investment adviser to each Fund, other than CM and TF, pursuant to a Sub-Investment Advisory Agreement between CAM and Chase. CAM is a wholly-owned subsidiary of Chase and is entitled to receive a fee, payable by Chase from its advisory fee, at an annual rate equal to 0.03% of each Fund's average daily net assets. Prior to August 1, 2000, Chase Bank of Texas, National Association ("CBT") was the sub-investment adviser to CM and TF pursuant to a Sub-Investment Advisory Agreement between Chase and CBT. CBT, a wholly-owned subsidiary of Chase, was entitled to receive a fee, payable by Chase from its advisory fee, at an annual rate equal to 0.03% of the Fund's average daily net assets. B. Shareholder and Fund servicing fees -- The Trust adopted Administrative Service Plans which, among other things, provide that the Trust on behalf of the Funds may obtain the services of one or more Shareholder Servicing Agents. For its services, each Shareholder Servicing Agent receives a fee. The fee is computed daily and paid monthly at an annual rate of 0.35% of the average daily net assets of the Vista and Reserve Classes, 0.25% of the average daily net assets of the Premier, B Share and C Share Classes, and 0.10% of the average daily net assets of the Institutional Class of each Fund. Chase and certain of its affiliates are the only Shareholder Servicing Agents. The Shareholder Servicing Agents have voluntarily waived fees as outlined in Note 2.E. below. C. Distribution and sub-administrations fees -- Pursuant to a Distribution and Sub-Administration Agreement, Vista Fund Distributors, Inc. ("VFD" or the "Distributor"), a wholly-owned subsidiary of The BISYS Group, Inc. ("BISYS"), acts as the Trust's exclusive underwriter and promotes and arranges for the sale of each Fund's shares. In addition, the Distributor provides certain sub-administration services to the Trust, including providing officers, clerical staff and office space for an annual fee computed daily and paid monthly of 0.05% of the average daily net assets of each Fund. The Trustees have adopted plans of distribution under the 1940 Act for the Premier Shares of USG (the "Premier Plan"), for the Vista Shares of each Fund (the "Vista Plan") except for CM and PRM, for the Reserve Shares of FED, PRM, TF and NYTF (the "Reserve Plan"), and for the B Shares and C Shares of PRM (the "B Plan" and "C Plan", respectively). 73 CHASE VISTA FUNDS NOTES TO FINANCIAL STATEMENTS (continued) There are no distribution plans for the Institutional Shares. The Premier, Vista, Reserve, B and C Share Plans pay the Distributor a distribution fee. The fee is computed daily and paid monthly at an annual rate of: 0.10% of the average daily net assets of the Vista Class of each Fund (except CM and PRM), 0.10% of the average daily net assets of the USG Premier Class, 0.30% of the average daily net assets of the Reserve Class of FED, PRM, TF and NYTF, and 0.75% of the average daily net assets of the B Shares and C Shares of PRM. The Distributor voluntarily waived fees as outlined in Note 2.E. below. D. Administration fee -- Pursuant to the Administration Agreement, Chase (the "Administrator") provides certain administration services and facilities to each Fund at a fee computed daily and paid monthly at the annual rate equal to 0.05% of the respective Fund's average daily net assets. The Administrator voluntarily waived fees as outlined in Note 2.E. below. E. Waiver of fees -- For the year ended August 31, 2000, the Funds' vendors voluntarily waived fees for each of the Funds as follows (amounts in thousands):
Investment Shareholder Advisory Administration Servicing Distribution - -------------------------------------------------------------------------------- USTS......... $-- $1,723 $1,629 $1,425 USG .......... -- 186 6,059 449 TP ........... -- 1,086 1,768 -- FED .......... -- -- 486 -- CM ........... -- 90 3,111 -- PRM .......... -- 103 6,479 -- TF ........... -- 369 1,677 -- NYTF.......... -- 746 -- 1,036 CTF .......... 44 -- 136 32
F. Other --Certain officers of the Trust are officers of VFD or of its parent corporation, BISYS. Chase provides portfolio accounting and custody services for the Funds. Compensation for such services is presented in the Statement of Operations as custodian fees. Custodian fees are subject to reduction by credits earned by each Fund, based on cash balances held by Chase as custodian. Such earnings credits are presented separately in the Statement of Operations. The Funds could have invested the cash balances utilized in connection with the earnings credit arrangements in income producing assets if they had not entered into such arrangements. During the year ended August 31, 2000, the fund accountant reimbursed PRM approximately $957,000 for uncollectible interest accruals. 74 CHASE VISTA FUNDS NOTES TO FINANCIAL STATEMENTS (continued) 3. Federal Income Tax Matters At August 31, 2000, the following Funds have capital loss carryovers which will be available to offset capital gains. To the extent that any net capital loss carryovers are used to offset future capital gains, it is probable that the gains so offset will not be distributed to shareholders.
Fund Amount Expiration Date - ------------------------------------------------------ USG ........... $ 13,546 Aug. 31, 2006 5,917 Aug. 31, 2007 -------- 19,463 FED ........... 6,078 Aug. 31, 2008 CM ............ 664,023 Aug. 31, 2008 TF ............ 336,447 Aug. 31, 2002 29,205 Aug. 31, 2003 812 Aug. 31, 2004 28,042 Aug. 31, 2006 -------- 394,506 NYTF .......... 1,760 Aug. 31, 2006 CTF ........... 3,956 Aug. 31, 2001 8,932 Aug. 31, 2004 652 Aug. 31, 2005 903 Aug. 31, 2006 -------- 14,443
During the year ended August 31, 2000, USG, NYTF and CTF utilized capital loss carryforwards of $1,404, $59,708 and $26, respectively. 4. Concentration of Credit Risk As of August 31, 2000, CM and PRM invested 76.6% and 87.0%, respectively, of their net assets in securities issued by institutions in the financial services industry including banks, broker dealers and insurance companies. General economic conditions, as well as exposure to credit losses arising from possible financial difficulties of borrowers, play an important role in the operation of the financial services industry. TF, NYTF and CTF invest substantially all of their assets in a diversified portfolio of debt obligations issued by states, territories and possessions of the United States and by the District of Columbia, and by their political subdivisions and duly constituted authorities, with NYTF primarily investing in issuers in the State of New York, and CTF primarily investing in issuers in the State of California. As of August 31, 2000, TF invested 18.4% of its net assets in issuers in the State of Texas. The issuers' abilities to meet their obligations may be affected by economic or political developments in a specific state or region. 75 CHASE VISTA FUNDS NOTES TO FINANCIAL STATEMENTS (continued) 5. Trustee Compensation The Funds have adopted an unfunded noncontributory defined benefit pension plan covering all independent trustees of the Funds who will have served as an independent trustee for at least five years at the time of retirement. Benefits under this plan are based on compensation and years of service. Pension expenses for the year ended August 31, 2000, included in Trustees Fees in the Statement of Operations, and accrued pension liability included in Other Accrued Liabilities in the Statement of Assets and Liabilities were as follows (in thousands):
Pension Accrued Fund Expenses Pension Liability - ---------------------------------------------------------- USTS ......... $ 72 $321 USG .......... 128 608 TP ........... 47 231 FED .......... 20 91 CM ........... 145 507 PRM .......... 188 466 TF ........... 25 119 NYTF ......... 26 123 CTF .......... 1 5
6. Subsequent Events Effective September 5, 2000, CAM changed its name to Chase Fleming Asset Management (USA) Inc. At a special meeting held October 5, 2000, shareholders of CM approved a Reorganization Plan whereby all of the assets and liabilities of CM will be transferred to PRM in exchange for shares in PRM. Under the Reorganization Plan, each shareholder of CM will receive shares in PRM with a value equal to their holdings in CM. Holders of Vista Class Shares in CM will receive Vista Class Shares in PRM, holders of Premier Class Shares in CM will receive Premier Class Shares in PRM and holders of Institutional Class Shares in CM will receive Institutional Class Shares in PRM. The effective date of the reorganization is expected to be October 20, 2000. 76 - -------------------------------------------------------------------------------- CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS - -------------------------------------------------------------------------------- FINANCIAL HIGHLIGHTS
100% U.S. Treasury Securities Money Market Fund ------------------------------------------------------------------------------------ Vista Shares ------------------------------------------------------------------------------------ Year Ended Year Ended August 31, 12/1/95++ November 30, ------------------------------------------- Through ------------- 2000 1999 1998 1997 8/31/96 1995 -------- ------ ------ ------ --------- ------------- Per Share Operating Performance Net Asset Value, Beginning of Period .......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------ ------ ------ ------ ------ Income from Investment Operations: Net Investment Income ........................ 0.05 0.04 0.05 0.05 0.04 0.05 Less Dividends from Net Investment Income ........................... 0.05 0.04 0.05 0.05 0.04 0.05 -------- ------ ------ ------ ------ ------ Net Asset Value, End of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ====== ====== ====== ====== ====== Total Return .................................. 5.02% 4.31% 4.92% 4.87% 3.50% 5.15% Ratios/Supplemental Data: Net Assets, End of Period (millions) ......... $3,535 $3,312 $3,051 $2,376 $1,672 $1,338 Ratios to Average Net Assets#: Expenses ..................................... 0.59% 0.59% 0.59% 0.59% 0.60% 0.58% Net Investment Income ........................ 4.92% 4.15% 4.78% 4.74% 4.58% 4.99% Expenses Without Waivers, Reimbursements and Earnings Credits ......................... 0.71% 0.71% 0.71% 0.71% 0.68% 0.61% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ...................................... 4.80% 4.03% 4.66% 4.62% 4.50% 4.96% - ------------------------------------------------------------------------------------------------------------------------------------ 100% U.S. Treasury Securities Money Market Fund ------------------------------------------------------------------------------------ Premier Shares ------------------------------------------------------------------------------------ Year Ended August 31, 12/1/95++ ------------------------------------------- Through 2000 1999 1998 1997 8/31/96 -------- ------ ------ ------ --------- Per Share Operating Performance Net Asset Value, Beginning of Period .......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------- ------- ------- --------- Income from Investment Operations: Net Investment Income ........................ 0.05 0.04 0.05 0.05 0.01 Less Dividends from Net Investment Income ........................... 0.05 0.04 0.05 0.05 0.01 -------- ------- ------- ------- --------- Net Asset Value, End of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======= ======= ======= ========= Total Return .................................. 5.12% 4.40% 5.00% 4.91% 1.11% Ratios/Supplemental Data: Net Assets, End of Period (millions) ......... $ 116 $ 24 $ 22 $ 6 $ 1 Ratios to Average Net Assets#: Expenses ..................................... 0.49% 0.50% 0.51% 0.55% 0.42% Net Investment Income ........................ 5.02% 4.22% 4.99% 4.80% 3.45% Expenses Without Waivers, Reimbursements and Earnings Credits ......................... 0.53% 0.56% 0.78% 0.80% 0.42% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ...................................... 4.98% 4.16% 4.72% 4.55% 3.45% - ------------------------------------------------------------------------------------------------------------------------------------
++ In 1996, the Fund changed its fiscal year-end from November 30 to August 31. * Commencement of offering of class of shares. # Short periods have been annualized. 77 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
100% U.S. Treasury Securities Money Market Fund -------------------------------------------------------- Institutional Shares -------------------------------------------------------- Year Ended August 31, 6/3/96* ------------------------------------------ Through 2000 1999 1998 1997 8/31/96 ------ ------ ------ ------ ------- Per Share Operating Performance Net Asset Value, Beginning of Period .......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------- ------- ------ ------- -------- Income from Investment Operations: Net Investment Income ........................ 0.05 0.05 0.05 0.05 0.01 Less Dividends from Net Investment Income ........................... 0.05 0.05 0.05 0.05 0.01 ------- ------- ------ ------- -------- Net Asset Value, End of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======= ======= ====== ======= ======== Total Return .................................. 5.38% 4.67% 5.30% 5.20% 1.23% Ratios/Supplemental Data: Net Assets, End of Period (millions) ......... $ 872 $ 895 $1,796 $ 81 $ 1 Ratios to Average Net Assets#: Expenses ..................................... 0.25% 0.24% 0.21% 0.27% 0.21% Net Investment Income ........................ 5.26% 4.51% 5.13% 5.06% 3.65% Expenses Without Waivers, Reimbursements and Earnings Credits ......................... 0.34% 0.32% 0.25% 0.27% 0.21% Net Investment Income Without Waivers, Reimbursements and Earnings Credits .......... 5.17% 4.43% 5.09% 5.06% 3.65% - --------------------------------------------------------------------------------------------------------
* Commencement of offering of class of shares. # Short periods have been annualized. See notes to financial statements. 78 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
U.S. Government Money Market Fund -------------------------------------------------------------- Vista Shares -------------------------------------------------------------- Year Ended August 31, -------------------------------------------------------------- 2000 1999 1998 1997 1996 ------ ------ ------ ------- ------- Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------ ------ ------ ------ ------ Income from Investment Operations: Net Investment Income .............................. 0.05 0.04 0.05 0.05 0.05 Less Dividends from Net Investment Income ......... 0.05 0.04 0.05 0.05 0.05 ------ ------ ------ ------ ------ Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ====== ====== ====== ====== ====== Total Return ........................................ 5.48% 4.55% 5.14% 5.04% 4.97% Ratios/Supplemental Data: Net Assets, End of Period (millions) ............... $3,398 $3,538 $3,033 $2,139 $2,057 Ratios to Average Net Assets: Expenses ........................................... 0.59% 0.59% 0.59% 0.59% 0.65% Net Investment Income .............................. 5.35% 4.46% 5.01% 4.93% 4.83% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 0.69% 0.69% 0.70% 0.72% 0.73% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 5.25% 4.36% 4.90% 4.80% 4.75% - -------------------------------------------------------------------------------------------------------------------------
See notes to financial statements. 79 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
U.S. Government Money Market Fund ------------------------------------------------------ Premier Shares ------------------------------------------------------ Year Ended August 31, ------------------------------------------------------ 2000 1999 1998 1997 1996 ---------- ---------- ---------- ---------- ---------- Per Share Operating Performance Net Asset Value, Beginning of Period ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------ ------ ------ ------ ------ Income from Investment Operations: Net Investment Income .......................... 0.05 0.05 0.05 0.05 0.05 Less Dividends from Net Investment Income ..... 0.05 0.05 0.05 0.05 0.05 ------ ------ ------ ------ ------ Net Asset Value, End of Period .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ====== ====== ====== ====== ====== Total Return .................................... 5.62% 4.70% 5.25% 5.08% 5.15% Ratios/Supplemental Data: Net Assets, End of Period (millions) ........... $1,134 $ 922 $1,084 $ 837 $ 802 Ratios to Average Net Assets: Expenses ....................................... 0.45% 0.45% 0.48% 0.55% 0.55% Net Investment Income .......................... 5.50% 4.60% 5.12% 4.97% 5.04% Expenses Without Waivers, Reimbursements and Earnings Credits ........................... 0.58% 0.58% 0.60% 0.60% 0.59% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ............ 5.37% 4.47% 5.00% 4.92% 5.00% - --------------------------------------------------------------------------------------------------------- U.S. Government Money Market Fund ------------------------------------------------------ Institutional Shares ------------------------------------------------------ Year Ended August 31, ------------------------------------------------------ 2000 1999 1998 1997 1996 ---------- ---------- ---------- ---------- ---------- Per Share Operating Performance Net Asset Value, Beginning of Period ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------ ------ ------ ------ ------ Income from Investment Operations: Net Investment Income .......................... 0.06 0.05 0.05 0.05 0.05 Less Dividends from Net Investment Income ..... 0.06 0.05 0.05 0.05 0.05 ------ ------ ------ ------ ------ Net Asset Value, End of Period .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ====== ====== ====== ====== ====== Total Return .................................... 5.83% 4.92% 5.51% 5.40% 5.45% Ratios/Supplemental Data: Net Assets, End of Period (millions) ........... $2,639 $2,913 $2,797 $2,955 $1,182 Ratios to Average Net Assets: Expenses ....................................... 0.26% 0.25% 0.24% 0.24% 0.27% Net Investment Income .......................... 5.66% 4.80% 5.36% 5.29% 5.30% Expenses Without Waivers, Reimbursements and Earnings Credits ........................... 0.33% 0.31% 0.24% 0.24% 0.27% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ............ 5.59% 4.74% 5.36% 5.29% 5.30% - ---------------------------------------------------------------------------------------------------------
See notes to financial statements. 80 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Treasury Plus Money Market Fund ------------------------------------------------------ Vista Shares ------------------------------------------------------ Year Ended August 31, 5/6/96* ------------------------------------------- Through 2000 1999 1998 1997 8/31/96 ---------- ---------- ---------- ---------- ---------- Per Share Operating Performance Net Asset Value, Beginning of Period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------ ------ ------ ------ ------ Income from Investment Operations: Net Investment Income ...................... 0.05 0.04 0.05 0.05 0.02 Less Dividends from Net Investment Income ......................... 0.05 0.04 0.05 0.05 0.02 ------ ------ ------ ------ ------ Net Asset Value, End of Period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ====== ====== ====== ====== ====== Total Return ................................ 5.29% 4.39% 5.05% 4.89% 1.50% Ratios/Supplemental Data: Net Assets, End of Period (millions) ....... $1,367 $1,734 $1,316 $1,606 $1,382 Ratios to Average Net Assets:# Expenses ................................... 0.59% 0.59% 0.59% 0.59% 0.59% Net Investment Income ...................... 5.14% 4.27% 4.92% 4.79% 4.63% Expenses Without Waivers, Reimbursements and Earnings Credits ....................... 0.71% 0.69% 0.70% 0.70% 0.73% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ........ 5.02% 4.17% 4.81% 4.68% 4.49% - ---------------------------------------------------------------------------------------------------- Treasury Plus Money Market Fund ------------------------------------------------------ Premier Shares ------------------------------------------------------ Year Ended August 31, ------------------------------------------------------ 2000 1999 1998 1997 1996 ---------- ---------- ---------- ---------- ---------- Per Share Operating Performance Net Asset Value, Beginning of Period ........ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------ ------ ------ ------ ------ Income from Investment Operations: Net Investment Income ...................... 0.05 0.04 0.05 0.05 0.05 Less Dividends from Net Investment Income ......................... 0.05 0.04 0.05 0.05 0.05 ------ ------ ------ ------ ------ Net Asset Value, End of Period .............. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ====== ====== ====== ====== ====== Total Return ................................ 5.44% 4.54% 5.18% 4.98% 5.07% Ratios/Supplemental Data: Net Assets, End of Period (millions) ....... $ 228 $ 476 $ 155 $ 131 $ 106 Ratios to Average Net Assets:# Expenses ................................... 0.45% 0.45% 0.46% 0.51% 0.52% Net Investment Income ...................... 5.28% 4.42% 5.06% 4.88% 4.85% Expenses Without Waivers, Reimbursements and Earnings Credits ....................... 0.51% 0.50% 0.50% 0.53% 0.63% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ........ 5.22% 4.37% 5.02% 4.86% 4.74% - ----------------------------------------------------------------------------------------------------
# Short periods have been annualized. * Commencement of offering of class of shares. See notes to financial statements. 81 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Treasury Plus Money Market Fund -------------------------------------------------------------- Institutional Shares -------------------------------------------------------------- Year Ended August 31, -------------------------------------------------------------- 2000 1999 1998 1997 1996 ---------- ---------- ---------- ---------- ---------- Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------ ------ ------ ------ ------ Income from Investment Operations: Net Investment Income .............................. 0.06 0.05 0.05 0.05 0.05 Less Dividends from Net Investment Income ......... 0.06 0.05 0.05 0.05 0.05 ------ ------ ------ ------ ------ Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ====== ====== ====== ====== ====== Total Return ........................................ 5.65% 4.75% 5.44% 5.24% 5.29% Ratios/Supplemental Data: Net Assets, End of Period (millions) ............... $ 904 $ 980 $ 876 $ 292 $ 189 Ratios to Average Net Assets: Expenses ........................................... 0.25% 0.24% 0.21% 0.26% 0.30% Net Investment Income .............................. 5.48% 4.61% 5.29% 5.16% 5.11% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 0.36% 0.31% 0.25% 0.26% 0.38% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 5.37% 4.54% 5.25% 5.16% 5.03% - -----------------------------------------------------------------------------------------------------------------------
See notes to financial statements. 82 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Federal Money Market Fund ------------------------------------------------------ Vista Shares ------------------------------------------------------ Year Ended August 31, ------------------------------------------------------ 2000 1999 1998 1997 1996 ------- ------- ------- ------- ------- Per Share Operating Performance Net Asset Value, Beginning of Period ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------- ------- ------- ------- ------- Income from Investment Operations: Net Investment Income .......................... 0.05 0.04 0.05 0.05 0.05 Less Dividends from Net Investment Income ..... 0.05 0.04 0.05 0.05 0.05 ------- ------- ------- ------- ------- Net Asset Value, End of Period .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======= ======= ======= ======= ======= Total Return .................................... 5.29% 4.46% 4.94% 4.91% 4.83% Ratios/Supplemental Data: Net Assets, End of Period (millions) ........... $ 576 $ 550 $ 359 $ 301 $ 353 Ratios to Average Net Assets: Expenses ....................................... 0.70% 0.70% 0.70% 0.70% 0.70% Net Investment Income .......................... 5.17% 4.35% 4.88% 4.79% 4.79% Expenses Without Waivers, Reimbursements and Earnings Credits ........................... 0.75% 0.78% 0.84% 0.82% 0.93% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ............ 5.12% 4.27% 4.74% 4.67% 4.56% - ---------------------------------------------------------------------------------------------------------- Federal Money Market Fund ------------------------------------------------------ Premier Shares ------------------------------------------------------ Year Ended August 31, ------------------------------------------------------ 2000 1999 1998 1997 1996 ------- ------- ------- ------- ------- Per Share Operating Performance Net Asset Value, Beginning of Period ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------- ------- ------- ------- ------- Income from Investment Operations: Net Investment Income .......................... 0.05 0.05 0.05 0.05 0.05 Less Dividends from Net Investment Income ..... 0.05 0.05 0.05 0.05 0.05 ------- ------- ------- ------- ------- Net Asset Value, End of Period .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======= ======= ======= ======= ======= Total Return .................................... 5.50% 4.67% 5.22% 5.12% 5.14% Ratios/Supplemental Data: Net Assets, End of Period (millions) ........... $ 279 $ 298 $ 313 $ 400 $ 249 Ratios to Average Net Assets: Expenses ....................................... 0.50% 0.50% 0.50% 0.50% 0.50% Net Investment Income .......................... 5.35% 4.56% 5.07% 5.01% 4.99% Expenses Without Waivers, Reimbursements and Earnings Credits ........................... 0.50% 0.50% 0.51% 0.52% 0.52% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ............ 5.35% 4.56% 5.06% 4.99% 4.97% - ------------------------------------------------------------------------------------------------------------
See notes to financial statements. 83 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Federal Money Market Fund ---------------------------------------------------------------------- Institutional Shares Reserve Shares ------------------------------------------------------ --------------- Year Ended August 31, 7/31/00* ------------------------------------------------------ Through 2000 1999 1998 1997 1996 8/31/00 ------- ------- ------- ------- ------- -------- Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------- ------- ------- ------- --------- Income from Investment Operations: Net Investment Income .............................. 0.06 0.05 0.05 0.05 0.05 0.01 Less Dividends from Net Investment Income ......... 0.06 0.05 0.05 0.05 0.05 0.01 -------- ------- ------- ------- ------- -------- Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======= ======= ======= ======= ======== Total Return ........................................ 5.75% 4.92% 5.46% 5.35% 5.35% 0.49% Ratios/Supplemental Data: Net Assets, End of Period (millions) ............... $ 287 $ 248 $ 198 $ 131 $ 141 $ + Ratios to Average Net Assets:# Expenses ........................................... 0.26% 0.26% 0.27% 0.27% 0.30% 0.79% Net Investment Income .............................. 5.61% 4.79% 5.32% 5.23% 5.20% 5.08% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 0.34% 0.34% 0.27% 0.27% 0.30% 1.44% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 5.53% 4.71% 5.32% 5.23% 5.20% 4.43% - ---------------------------------------------------------------------------------------------------------------------------
* Commencement of offering of class of shares. # Short periods have been annualized. + Amount rounds to less than one million. See notes to financial statements. 84 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Cash Management Fund -------------------------------------------------------------------------- Vista Shares -------------------------------------------------------------------------- Year Ended August 31, 12/1/95++ Year Ended ----------------------------------------- Through November 30, 2000 1999 1998 1997 8/31/96 1995 -------- ------ ------ ------ --------- ------ Per Share Operating Performance Net Asset Value, Beginning of Period .......... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------ ------ ------ ------- ------ Income from Investment Operations: Net Investment Income ........................ 0.06 0.05 0.05 0.05 0.04 0.05 Less Dividends from Net Investment Income ........................... 0.06 0.05 0.05 0.05 0.04 0.05 -------- ------ ------ ------ ------- ------ Net Asset Value, End of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ====== ====== ====== ======= ====== Total Return .................................. 5.66% 4.74% 5.23% 5.09% 3.69% 5.49% Ratios/Supplemental Data: Net Assets, End of Period (millions) ......... $7,345 $5,679 $3,642 $2,576 $1,621 $1,634 Ratios to Average Net Assets:# Expenses ..................................... 0.59% 0.59% 0.59% 0.59% 0.60% 0.58% Net Investment Income ........................ 5.58% 4.61% 5.09% 4.99% 4.91% 5.35% Expenses Without Waivers, Reimbursements and Earnings Credits ......................... 0.61% 0.62% 0.61% 0.62% 0.63% 0.62% Net Investment Income Without Waivers, Reimbursements and Earnings Credits .......... 5.56% 4.58% 5.07% 4.96% 4.88% 5.31% - ---------------------------------------------------------------------------------------------------------------------------
++ In 1996, the Fund changed its fiscal year-end from November 30 to August 31. # Short periods have been annualized. See notes to financial statements. 85 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Cash Management Fund ------------------------------------------------------- Premier Shares ------------------------------------------------------- Year Ended August 31, ------------------------------------------- 5/6/96* Through 2000 1999 1998 1997 8/31/96 -------- ------- ------- ------- --------- Per Share Operating Performance Net Asset Value, Beginning of Period ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------- ------- ------- --------- Income from Investment Operations: Net Investment Income .......................... 0.06 0.05 0.05 0.05 0.02 Less Dividends from Net Investment Income ..... 0.06 0.05 0.05 0.05 0.02 -------- ------- ------- ------- --------- Net Asset Value, End of Period .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======= ======= ======= ========= Total Return .................................... 5.81% 4.89% 5.35% 5.18% 1.61% Ratios/Supplemental Data: Net Assets, End of Period (millions) ........... $ 426 $ 463 $ 415 $ 375 $ 433 Ratios to Average Net Assets:# Expenses ....................................... 0.45% 0.45% 0.47% 0.50% 0.50% Net Investment Income .......................... 5.72% 4.77% 5.22% 5.07% 4.93% Expenses Without Waivers, Reimbursements and Earnings Credits ........................... 0.50% 0.50% 0.52% 0.51% 0.52% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ............ 5.67% 4.72% 5.17% 5.06% 4.91% Cash Management Fund ------------------------------------------------------- Institutional Shares ------------------------------------------------------- Year Ended August 31, ------------------------------------------- 5/6/96* Through 2000 1999 1998 1997 8/31/96 -------- ------- ------- ------- --------- Per Share Operating Performance Net Asset Value, Beginning of Period ............ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------ ------ ------- ------- Income from Investment Operations: Net Investment Income .......................... 0.06 0.05 0.06 0.05 0.02 Less Dividends from Net Investment Income ..... 0.06 0.05 0.06 0.05 0.02 -------- ------ ------ ------- ------- Net Asset Value, End of Period .................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ====== ====== ======= ======= Total Return .................................... 6.01% 5.09% 5.59% 5.45% 1.69% Ratios/Supplemental Data: Net Assets, End of Period (millions) ........... $3,304 $1,547 $1,060 $ 924 $ 657 Ratios to Average Net Assets:# Expenses ....................................... 0.26% 0.26% 0.24% 0.24% 0.25% Net Investment Income .......................... 5.91% 4.95% 5.45% 5.34% 5.22% Expenses Without Waivers, Reimbursements and Earnings Credits ........................... 0.33% 0.32% 0.24% 0.24% 0.25% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ............ 5.84% 4.89% 5.45% 5.34% 5.22% - ---------------------------------------------------------------------------------------------------------
* Commencement of offering of class of shares. # Short periods have been annualized. See notes to financial statements. 86 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Prime Money Market Fund -------------------------------------------------------------- Premier Shares -------------------------------------------------------------- Year Ended August 31, ----------------------------------------------------------------- 2000 1999 1998 1997 1996 -------- ------- ------- ------- ------- Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------- ------- ------- ------- Income from Investment Operations: Net Investment Income .............................. 0.06 0.05 0.05 0.05 0.05 Less Dividends from Net Investment Income ......... 0.06 0.05 0.05 0.05 0.05 -------- ------- ------- ------- ------- Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======= ======= ======= ======= Total Return ........................................ 5.81% 4.90% 5.44% 5.34% 5.32% Ratios/Supplemental Data: Net Assets, End of Period (millions) ............... $1,841 $1,094 $ 590 $ 499 $ 419 Ratios to Average Net Assets: Expenses ........................................... 0.45% 0.45% 0.45% 0.45% 0.45% Net Investment Income .............................. 5.67% 4.77% 5.29% 5.17% 5.18% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 0.49% 0.49% 0.51% 0.53% 0.51% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 5.63% 4.73% 5.23% 5.09% 5.12% - ------------------------------------------------------------------------------------------------------------------------------------
See notes to financial statements. 87 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Prime Money Market Fund -------------------------------------------------------------- Institutional Shares -------------------------------------------------------------- Year Ended August 31, ----------------------------------------------------------------- 2000 1999 1998 1997 1996 -------- ------ ------ ------ ------ Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------ ------ ------ ------- Income from Investment Operations: Net Investment Income .............................. 0.06 0.05 0.06 0.05 0.05 Less Dividends from Net Investment Income ......... 0.06 0.05 0.06 0.05 0.05 -------- ------ ------ ------ ------- Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ====== ====== ====== ======= Total Return ........................................ 6.01% 5.10% 5.65% 5.49% 5.51% Ratios/Supplemental Data: Net Assets, End of Period (millions) ............... $9,430 $8,161 $4,722 $1,348 $ 725 Ratios to Average Net Assets: Expenses ........................................... 0.26% 0.26% 0.24% 0.25% 0.26% Net Investment Income .............................. 5.86% 4.96% 5.50% 5.37% 5.33% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 0.33% 0.33% 0.24% 0.25% 0.26% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 5.79% 4.89% 5.50% 5.37% 5.33% - --------------------------------------------------------------------------------------------------------------------------
See notes to financial statements. 88 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Prime Money Market Fund -------------------------------------------------------------- B Shares -------------------------------------------------------------- Year Ended August 31, ----------------------------------------------------------------- 2000 1999 1998 1997 1996 -------- ------- ------- ------- ------- Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------- ------- ------- ------- Income from Investment Operations: Net Investment Income .............................. 0.05 0.04 0.05 0.04 0.04 Less Dividends from Net Investment Income ......... 0.05 0.04 0.05 0.04 0.04 -------- ------- ------- ------- ------- Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======= ======= ======= ======= Total Return ........................................ 4.97% 4.07% 4.60% 4.33% 4.25% Ratios/Supplemental Data: Net Assets, End of Period (millions) ............... $ 11 $ 36 $ 29 $ 10 $ 16 Ratios to Average Net Assets: Expenses ........................................... 1.25% 1.25% 1.25% 1.35% 1.47% Net Investment Income .............................. 4.87% 4.00% 4.49% 4.27% 4.17% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 1.27% 1.47% 1.50% 1.53% 1.71% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 4.85% 3.78% 4.24% 4.09% 3.93% - --------------------------------------------------------------------------------------------------------------------------
See notes to financial statements. 89 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Prime Money Market Fund ------------------------------------------------------------------------------ C Shares Vista Shares Reserve Shares ------------------------------------ ------------------------ --------------- Year Year 5/14/98* Year 10/1/98* 7/31/00* Ended Ended Through Ended Through Through 8/31/00 8/31/99 8/31/98 8/31/00 8/31/99 8/31/00 ------- ------- --------- --------- --------- ----------- Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------- ------- --------- -------- --------- --------- Income from Investment Operations: Net Investment Income .............................. 0.05 0.04 0.01 0.06 0.04 0.01 Less Dividends from Net Investment Income ......... 0.05 0.04 0.01 0.06 0.04 0.01 ------- ------- --------- -------- --------- --------- Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======= ======= ========= ======== ========= ========= Total Return ........................................ 4.95% 3.85% 1.29% 5.65% 4.26% 0.50% Ratios/Supplemental Data: Net Assets, End of Period (millions) ............... $ + $ 1 $ 1 $ 1,475 $ 515 $ + Ratios to Average Net Assets:# Expenses ........................................... 1.26% 1.45% 1.50% 0.59% 0.59% 0.79% Net Investment Income .............................. 4.86% 3.75% 4.21% 5.53% 4.61% 5.33% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 1.26% 1.45% 1.50% 0.61% 0.72% 1.45% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 4.86% 3.75% 4.21% 5.51% 4.48% 4.67% - ------------------------------------------------------------------------------------------------------------------------------------
# Short periods have been annualized. * Commencement of offering of classes of shares. + Amount rounds to less than one million. See notes to financial statements. 90 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Tax Free Money Market Fund ---------------------------------------------------------------------- Vista Shares Reserve Shares ------------------------------------------------------ --------------- Year Ended August 31, 7/31/00* ------------------------------------------------------ Through 2000 1999 1998 1997 1996 8/31/00 -------- ------- ------ ------- ------- -------- Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------- ------- ------- ------- --------- Income from Investment Operations: Net Investment Income .............................. 0.03 0.03 0.03 0.03 0.03 -- Less Dividends from Net Investment Income ......... 0.03 0.03 0.03 0.03 0.03 -- -------- ------- ------- ------- ------- --------- Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======= ======= ======= ======= ========= Total Return ........................................ 3.37% 2.73% 3.10% 3.12% 2.92% 0.30% Ratios/Supplemental Data: Net Assets, End of Period (millions) ............... $ 895 $ 754 $ 733 $ 566 $ 574 $ + Ratios to Average Net Assets:# Expenses ........................................... 0.59% 0.59% 0.59% 0.59% 0.69% 0.79% Net Investment Income .............................. 3.33% 2.68% 3.05% 3.08% 2.89% 3.13% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 0.75% 0.73% 0.72% 0.73% 0.80% 1.44% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 3.17% 2.54% 2.92% 2.94% 2.78% 2.48% - ----------------------------------------------------------------------------------------------------------------------------
* Commencement of offering of class of shares. # Short periods have been annualized. + Amount rounds to less than one million. See notes to financial statements. 91 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Tax Free Money Market Fund -------------------------------------------------------------- Premier Shares -------------------------------------------------------------- Year Ended August 31, ----------------------------------------------------------------- 2000 1999 1998 1997 1996 -------- ------- ------- ------- ------- Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------- ------- ------- ------- Income from Investment Operations: Net Investment Income .............................. 0.03 0.03 0.03 0.03 0.03 Less Dividends from Net Investment Income ......... 0.03 0.03 0.03 0.03 0.03 -------- ------- ------- ------- ------- Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======= ======= ======= ======= Total Return ........................................ 3.41% 2.78% 3.17% 3.19% 3.12% Ratios/Supplemental Data: Net Assets, End of Period (millions) ............... $ 120 $ 130 $ 133 $ 105 $ 145 Ratio to Average Net Assets: Expenses ........................................... 0.55% 0.54% 0.53% 0.53% 0.58% Net Investment Income .............................. 3.40% 2.74% 3.10% 3.13% 3.08% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 0.59% 0.56% 0.53% 0.53% 0.73% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 3.26% 2.72% 3.10% 3.13% 2.93% - -------------------------------------------------------------------------------------------------------------------------
See notes to financial statements. 92 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
Tax Free Money Market Fund -------------------------------------------------------------- Institutional Shares -------------------------------------------------------------- Year Ended August 31, ----------------------------------------------------------------- 2000 1999 1998 1997 1996 -------- ------- ------- ------- ------- Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------- ------- ------- ------- Income from Investment Operations: Net Investment Income .............................. 0.04 0.03 0.03 0.04 0.03 Less Dividends from Net Investment Income ......... 0.04 0.03 0.03 0.04 0.03 -------- ------- ------- ------- ------- Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======= ======= ======= ======= Total Return ........................................ 3.71% 3.07% 3.45% 3.45% 3.40% Ratios/Supplemental Data: Net Assets, End of Period (millions) ............... $ 640 $ 476 $ 410 $ 286 $ 149 Ratio to Average Net Assets: Expenses ........................................... 0.26% 0.26% 0.26% 0.26% 0.31% Net Investment Income .............................. 3.67% 3.01% 3.37% 3.41% 3.33% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 0.39% 0.35% 0.26% 0.26% 0.31% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 3.54% 2.92% 3.37% 3.41% 3.33% - --------------------------------------------------------------------------------------------------------------------------
See notes to financial statements. 93 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
New York Tax Free Money Market Fund ---------------------------------------------------------------------- Vista Shares Reserve Shares ------------------------------------------------------ --------------- Year Ended August 31, 7/31/00* ------------------------------------------------------ Through 2000 1999 1998 1997 1996 8/31/00 ---------- -------- -------- -------- -------- --------------- Per Share Operating Performance Net Asset Value, Beginning of Period ................ $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ------ ------ ------ ------ ------ ------ Income from Investment Operations: Net Investment Income .............................. 0.03 0.03 0.03 0.03 0.03 -- Less Dividends from Net Investment Income ......... 0.03 0.03 0.03 0.03 0.03 -- ------ ------ ------ ------ ------ ------- Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ====== ====== ====== ====== ====== ======= Total Return ........................................ 3.27% 2.66% 3.03% 3.02% 2.85% 0.28% Ratios/Supplemental Data: Net Assets, End of Period (millions) ................ $1,831 $1,505 $1,372 $ 957 $ 890 $ + Ratio to Average Net Assets:# Expenses ........................................... 0.59% 0.59% 0.59% 0.59% 0.74% 0.79% Net Investment Income .............................. 3.24% 2.61% 2.97% 2.97% 2.79% 3.04% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 0.70% 0.71% 0.72% 0.73% 0.83% 1.49% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 3.13% 2.49% 2.84% 2.83% 2.70% 2.34% - -----------------------------------------------------------------------------------------------------------------------------
* Commencement of offering of class of shares. # Short periods have been annualized. + Amount rounds to less than one million. See notes to financial statements. 94 CHASE VISTA FUNDS FINANCIAL HIGHLIGHTS FINANCIAL HIGHLIGHTS
California Tax Free Money Market Fund -------------------------------------------------------------- Vista Shares -------------------------------------------------------------- Year Ended August 31, ----------------------------------------------------------------- 2000 1999 1998 1997 1996 -------- ------- ------- ------- ------- Per Share Operating Performance Net Asset Value, Beginning of Period ............... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 -------- ------- ------- ------- ------- Income from Investment Operations: Net Investment Income .............................. 0.03 0.03 0.03 0.03 0.03 Less Dividends from Net Investment Income ......... 0.03 0.03 0.03 0.03 0.03 -------- ------- ------- ------- ------- Net Asset Value, End of Period ...................... $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 ======== ======= ======= ======= ======= Total Return ........................................ 3.00% 2.66% 2.97% 3.02% 3.06% Ratios/Supplemental Data: Net Assets, End of Period (millions) ................ $ 78 $ 68 $ 50 $ 46 $ 43 Ratio of Average Net Assets: Expenses ........................................... 0.55% 0.55% 0.55% 0.56% 0.56% Net Investment Income .............................. 3.03% 2.55% 2.89% 2.99% 3.03% Expenses Without Waivers, Reimbursements and Earnings Credits ............................... 0.90% 0.94% 0.93% 0.86% 1.02% Net Investment Income Without Waivers, Reimbursements and Earnings Credits ................ 2.68% 2.16% 2.51% 2.69% 2.57% - -------------------------------------------------------------------------------------------------------------------------
See notes to financial statements. 95 - -------------------------------------------------------------------------------- REPORT OF INDEPENDENT ACCOUNTANTS - -------------------------------------------------------------------------------- To the Trustees and Shareholders of Mutual Fund Trust In our opinion, the accompanying statements of assets and liabilities, including the portfolios of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of Chase Vista 100% U.S. Treasury Securities Money Market Fund, Chase Vista Treasury Plus Money Market Fund, Chase Vista Federal Money Market Fund, Chase Vista U.S. Government Money Market Fund, Chase Vista Cash Management Fund, Chase Vista Prime Money Market Fund, Chase Vista Tax Free Money Market Fund, Chase Vista New York Tax Free Money Market Fund and Chase Vista California Tax Free Money Market Fund (separate portfolios of Mutual Fund Trust, hereafter referred to as the "Trust") at August 31, 2000, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period then ended and the financial highlights for each of the periods presented (for the four years in the period ended August 31, 2000 and for the period December 1, 1995 through August 31, 1996 for Chase Vista 100% U.S. Treasury Securities Money Market Fund and Chase Vista Cash Management Fund), in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Trust's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at August 31, 2000 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion. The financial highlights of Chase Vista 100% U.S. Treasury Securities Money Market Fund and Chase Vista Cash Management Fund for the year ended November 30, 1995 were audited by other independent accountants whose report dated January 19, 1996 expressed an unqualified opinion on these financial highlights. PricewaterhouseCoopers LLP 1177 Avenue of the Americas New York, New York 10036 October 11, 2000 96 - -------------------------------------------------------------------------------- TAX LETTER (UNAUDITED) - -------------------------------------------------------------------------------- Chase Vista 100% U.S. Treasury Securities Money Market Fund (USTS) Chase Vista U.S. Government Money Market Fund (USG) Chase Vista Treasury Plus Money Market Fund (TP) Chase Vista Federal Money Market Fund (FED) Chase Vista Cash Management Fund (CM) Chase Vista Prime Money Market Fund (PRM) Chase Vista Tax Free Money Market Fund (TF) Chase Vista New York Tax Free Money Market Fund (NYTF) Chase Vista California Tax Free Money Market Fund (CTF) - -------------------------------------------------------------------------------- Certain tax information regarding the Chase Vista Mutual Funds is required to be provided to shareholders based upon the Funds' income and distributions for the taxable year ended August 31, 2000. The information and distributions reported in this letter may differ from the information and distributions taxable to the shareholders for the calendar year ending December 31, 2000. The information necessary to complete your income tax returns for the calendar year ending December 31, 2000 will be received under separate cover. The following schedule presents the source and percentage of income from government obligations for the fiscal year ended August 31, 2000.
USTS USG TP FED CM PRM ------------ ---------- ----------- ---------- ---------- ---------- U.S. Treasury Obligations 100.00% 0.12% 22.80% 1.46% -- -- Federal Farm Credit Bank -- 3.20% -- 21.14% 0.13% -- Federal Home Loan Bank -- 36.74% -- 70.22% 2.24% 1.92% Student Loan Marketing Association -- 8.36% -- 7.17% 0.65% -- Tennessee Valley Authority -- -- -- 0.01% -- -- Federal National Mortgage Association -- 39.10% -- -- -- 0.01%
Also, for the fiscal year ended August 31, 2000: o The dividends paid from net investment income are 99.45%, 99.59% and 99.74% exempt from Federal income tax for TF, NYTF and CTF, respectively. o For shareholders who are subject to the Alternative Minimum Tax, the income from private activity bonds issued after August 7, 1986, which may be considered a tax preference item, was 13.76%, 14.13% and 13.60% for TF, NYTF, and CTF, respectively. 97 CHASE VISTA MONEY MARKET FUNDS ANNUAL REPORT - -------------------------------------------------------------------------------- Investment Adviser, Administrator, Shareholder and Fund Servicing Agent and Custodian The Chase Manhattan Bank Distributor Vista Fund Distributors, Inc. Transfer Agent DST Systems, Inc. Legal Counsel Simpson Thacher & Bartlett Independent Accountants PricewaterhouseCoopers LLP Chase Vista Funds are distributed by Vista Fund Distributors, Inc., which is unaffiliated with The Chase Manhattan Bank. Chase and its respective affiliates receive compensation from Chase Vista Funds for providing investment advisory and other services. This report is submitted for the general information of the shareholders of the funds. It is not authorized for distribution to prospective investors in the funds unless preceded or accompanied by a prospectus. To obtain a prospectus for any of the Chase Vista Funds, call 1-800-34-VISTA. The prospectus contains more complete information, including charges and expenses. Please read it carefully before you invest or send money. (c) The Chase Manhattan Corporation, 2000. All Rights Reserved. October 2000 [Logo] CHASE VISTA FUNDS[RegTM] Chase Vista Funds Fulfillment Center 393 Manley Street West Bridgewater, MA 02379-1039 EX-99.17(H) 8 a2044397zex-99_17h.txt EXHIBIT 99.17(H) [front cover} J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND [jp morgan logo] Annual Report October 31, 2000 LETTER TO THE SHAREHOLDERS - -------------------------------------------------------------------------------- December 1, 2000 Dear Shareholder: For the 12 months ended October 31, 2000, the Institutional Service Federal Money Market Fund provided a total return of 5.84%. The Fund was competitive with its peer group, the Lipper Institutional U.S. Government Money Market Funds Average, which had a total return of 5.90% for the same time period. The Fund maintained a stable net asset value of $1.00 over the period. On October 31, 2000, the net assets of the Fund were approximately $248 million, while the assets of the Federal Money Market Portfolio, in which the Fund invests, amounted to approximately $3.7 billion. Dividends of approximately $0.06 per share were paid from ordinary income during the period. On the pages that follow, the Fund's lead portfolio manager, Mark Settles, discusses the fixed-income market in detail. Mark also explains the factors that influenced fund performance during the fiscal period, and provides insight in regard to positioning the Fund for the coming months. As chairman and president of Asset Management Services, we appreciate your investment in the Fund. If you have any comments or questions, please contact your Morgan representative or call J.P. Morgan Funds Services at (800) 766-7722. Sincerely yours, /signature/ /signature/ Ramon de Oliveira Keith M. Schappert Chairman of Asset Management Services President of Asset Management Services J.P. Morgan & Co. Incorporated J.P. Morgan & Co. Incorporated TABLE OF CONTENTS - -------------------------------------------------------------------------------- Letter to the Shareholders 1 Fund Performance 2 Portfolio Manager Q&A 3 Fund Facts & Highlights 5 Financial Statements 6 1 FUND PERFORMANCE - -------------------------------------------------------------------------------- EXAMINING PERFORMANCE One way to look at performance is to review a fund's average annual total return. This calculation takes the Fund's actual return and shows what would have happened if the Fund had achieved that return by performing at a constant rate each year. Average annual total returns represent the average yearly change in a fund's value over various time periods, typically one, five, or ten years (or since inception). PERFORMANCE
TOTAL AVERAGE ANNUAL RETURNS TOTAL RETURNS ------------ --------------------------------- ONE THREE FIVE SINCE YEAR YEARS* YEARS* INCEPTION* AS OF OCTOBER 31, 2000 J.P. Morgan Institutional Service Federal Money Market Fund 5.84% 5.28% 5.21% 4.75% Lipper Institutional U.S. Government Money Market Funds Average** 5.90% 5.32% 5.30% 4.88% AS OF SEPTEMBER 30, 2000 J.P. Morgan Institutional Service Federal Money Market Fund 5.74% 5.25% 5.19% 4.73% Lipper Institutional U.S. Government Money Market Funds Average** 5.78% 5.29% 5.28% 4.86%
* The Fund's returns include historical returns of the J.P. Morgan Federal Money Market Fund, which has a higher expense ratio, from January 4, 1993 (the inception date of the J.P. Morgan Federal Money Market Fund), through November 5, 1997 (the inception date of the J.P. Morgan Institutional Service Federal Money Market Fund). The J.P. Morgan Institutional Service Federal Money Market Fund's annualized return from January 4, 1993 through October 31, 2000 was 4.73% . For purposes of comparison, the "since inception" returns are calculated from January 31, 1993, the first date when date for the J.P. Morgan Federal Money Market Fund, and its Lipper category were available. ** Describes the average total return for all funds in the indicated Lipper category, as defined by Lipper, Inc., and does not take into account applicable sales charges. Lipper Analytical Services, Inc. is a leading source for mutual fund data. Past performance is no guarantee of future results. Fund returns are net of fees, assume the reinvestment of distributions and reflect reimbursement of certain fund and portfolio expenses as described in the prospectus. Had expenses not been subsidized, returns would have been lower. 2 PORTFOLIO MANAGER Q&A - -------------------------------------------------------------------------------- [photo of Mark Settles] The following is an interview with MARK SETTLES, vice president and member of the portfolio management team for the Federal Money Market Portfolio. Mark joined Morgan in 1994, and spent five years trading fixed-income products in our New York and London offices before coming to J.P. Morgan Investment Management. Prior to joining Morgan, he was a foreign exchange trader at The First National Bank of Chicago, and a teacher of government at the Paideia School in Atlanta, Georgia. Mark holds a B.A. in economics from Columbia University, and a Masters of Management from Northwestern University. This interview was conducted on November 15, 2000, and reflects Mark's views on that date. WHAT THEMES DOMINATED FIXED INCOME MARKETS OVER THE PAST YEAR? One key theme of interest to our clients was the announcement--and subsequent implementation-- of a program by the U.S. Treasury to buy back government debt and issue fewer securities in the future. An effective reduction in the supply of what is globally perceived to be the lowest-risk investment has had a profound effect on fixed income markets. This has spurred a search for investment alternatives that can take the place of Treasuries in conservative portfolios and hedging strategies. Another key theme surfaced last spring when a senior Treasury official questioned the nature of implied guarantees associated with certain government sponsored entities. These agencies have traditionally funded themselves at quasi-government type levels due to their near "risk-free" status. This questioning of the government's commitment led to significant volatility in the agency and mortgage-backed securities markets. Also during this period, the Federal Reserve continued to raise interest rates in an effort to tame economic growth. The Fed's last increase of 50 basis points (0.50%) to 6.5% in May 2000, marked the sixth consecutive rate increase--totaling 175 basis points (1.75%)--since June 1999. These moves, along with an announced bias toward further tightening, served to markedly increase volatility in U.S. and global equity markets. Around the same time, evidence emerged that our economy was indeed slowing from its previous red-hot pace, and that global growth was following suit. As we moved toward the end of this reporting period, we also experienced a major surge in energy prices. For the most part, corporations lacked the pricing power to pass along higher costs, and we began to hear talk of a hard landing for the U.S. economy. The equity markets fell, and the Treasury curve steepened. YOU MENTIONED THE REDUCTION OF DEBT ISSUANCE BY THE U.S. TREASURY. IS THIS ACROSS THE ENTIRE MATURITY SPECTRUM, OR IS IT FOCUSED ON SPECIFIC SEGMENTS? The U.S. Treasury is attempting to use the budget surplus to shorten the average maturity of the country's outstanding debt. As a consequence, the very existence of the 30-year bond and the Treasury Inflation Protected Securities (TIPs) program has been called into question, and auctions for the 1-year bill, and 2-, 5-, and 10-year notes have all been reduced. For example, the traditional monthly auction for the 1-year bill has now moved to a quarterly auction. HOW WAS THE FUND POSITIONED OVER THIS PERIOD? We maintained a barbell structure in the portfolio over the course of the year just ended, keeping a significant concentration in short-term securities. We also looked to opportunistically extend the maturity of the portfolio on price declines in the one-year sector. This strategy allowed us to take advantage of higher rates on the very short end of the curve as the Fed funds rate continued to increase. It also allowed us to purchase one-year yields at attractive levels. The Fund also benefited by holding Agencies, which contributed to performance during the course of the year. 3 PORTFOLIO MANAGER Q&A - -------------------------------------------------------------------------------- HOW ARE FIXED INCOME MARKETS ADJUSTING TO THESE AND OTHER CHANGING DYNAMICS? Short-term fixed income mandates revolve around three essential requirements: safety, liquidity, and return. With the present and expected future decline in the availability of low risk Treasuries, all three of these requirements have to be reevaluated and reintegrated into an investment strategy. For example, we, and other bond investors, are searching for acceptable alternatives to Treasuries, such as Agency bonds. HOW ARE YOU DEALING WITH THESE CHANGES AT J.P. MORGAN? We're spending a good deal of time educating our clients on the uses of credit in a conservative portfolio, in particular, the tools and strategies needed to outperform in this market environment. We've also taken significant steps toward reengineering our credit process to take advantage of changing market dynamics. One of these steps has been the development and implementation of improved guidelines on concentration limits per credit. Beyond this, we are continuing to forge closer relationships with both buy- and sell-side analysts, and we're examining new electronic-based trading solutions. These steps and others are helping us to fine-tune our credit process so that we can meet the demands of today's marketplace. HOW DO YOU SEE THINGS PLAYING OUT IN THE FIXED INCOME MARKETS OVER THE COMING MONTHS? We anticipate a bond friendly environment, one marked by continued moderation in U.S. economic growth. As far as the Fed is concerned, the present behavior of the market for Fed fund futures suggests that its next move might be an easing of credit conditions. However, we believe the recent surge in energy prices, the firmness in unit labor costs, and associated inflationary fears, should keep the Fed on hold for the time being. HOW ARE YOU POSITIONING THE FUND IN LIGHT OF THIS OUTLOOK? We are looking for additional opportunities to extend into the one-year area, as the LIBOR curve steepens. This is only sensible, when you consider that the 2-year note presently stands at 5.91%, the 5-year at 5.82%, the 10-year at 5.78%, and long bonds at 5.81%. None of these is close to 6.5%, so we're keeping as much as possible in short dated maturities. 4 FUND FACTS - -------------------------------------------------------------------------------- INVESTMENT OBJECTIVE J.P. Morgan Institutional Service Federal Money Market Fund seeks to provide current income, maintain a high level of liquidity, and preserve capital. It is designed for investors who seek to preserve capital and earn current income from a portfolio of direct obligations of the U.S. Treasury, along with obligations of select U.S. government agencies. - -------------------------------------------------------------------------------- Inception Date: 11/5/1997 - -------------------------------------------------------------------------------- Fund Net Assets as of 10/31/2000: $247,735,304 - -------------------------------------------------------------------------------- Portfolio Net Assets as of 10/31/2000: $3,720,801,285 - -------------------------------------------------------------------------------- Dividend Payable Dates: MONTHLY - -------------------------------------------------------------------------------- Short-term Capital Gain Payable Date (if applicable): MONTHLY - -------------------------------------------------------------------------------- Long-term Capital Gain Payable Date (if applicable): 12/13/2000 EXPENSE RATIO The Fund's current expense ratio of 0.45% covers shareholders' expenses for custody, tax reporting, investment advisory, and shareholder services, after reimbursement. The Fund is no-load and does not charge any sales, redemption, or exchange fees. There are no additional charges for buying, selling, or safekeeping fund shares, or for wiring redemption proceeds from the Fund. FUND HIGHLIGHTS - -------------------------------------------------------------------------------- All data as of October 31, 2000 DAYS TO MATURITY (As a percentage of total investment securities) [data from pie chart] 0-30 Days 54.5% 31-60 Days 18.4% 61-90 Days 3.4% 90+ Days 23.7% - -------------------------------------------------------------------------------- Average 7-day current yield: 6.12%* - -------------------------------------------------------------------------------- Average Maturity: 45 DAYS * Yield reflects the reimbursement of certain fund expenses as described in the prospectus. Had expenses not been subsidized, the average 7-day current yield would have been lower. Yields represent past performance and will fluctuate. DISTRIBUTED BY FUNDS DISTRIBUTOR, INC. J.P. MORGAN INVESTMENT MANAGEMENT INC. SERVES AS INVESTMENT ADVISOR. SHARES OF THE FUND ARE NOT INSURED BY THE FDIC, ARE NOT BANK DEPOSITS OR OTHER OBLIGATIONS OF THE FINANCIAL INSTITUTION AND ARE NOT GUARANTEED BY THE FINANCIAL INSTITUTION. SHARES OF THE FUND ARE SUBJECT TO INVESTMENT RISK, INCLUDING POSSIBLE LOSS OF THE PRINCIPAL INVESTED. WHILE THE FUND SEEKS TO MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE, IT IS POSSIBLE TO LOSE MONEY BY INVESTING IN THIS FUND. Opinions expressed herein are based on current market conditions and are subject to change without notice. The Fund invests through a master portfolio (another fund with the same objective). CALL J.P. MORGAN FUNDS SERVICES AT (800) 766-7722 FOR A PROSPECTUS CONTAINING MORE COMPLETE INFORMATION ABOUT THE FUND, INCLUDING MANAGEMENT FEES AND OTHER EXPENSES. PLEASE READ THE PROSPECTUS CAREFULLY BEFORE INVESTING. 5 J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND STATEMENT OF ASSETS AND LIABILITIES - -------------------------------------------------------------------------------- OCTOBER 31, 2000 ASSETS Investment in The Federal Money Market Portfolio (''Portfolio''), at value $249,162,752 Receivable for Expense Reimbursements 23,236 Deferred Organization Expenses 4,958 Prepaid Trustees' Fees and Expenses 450 Prepaid Expenses and Other Assets 81 -------------------- TOTAL ASSETS 249,191,477 -------------------- LIABILITIES Dividends Payable to Shareholders 1,332,454 Service Organization Fee Payable 54,988 Shareholder Servicing Fee Payable 10,998 Administrative Services Fee Payable 5,283 Administration Fee Payable 193 Fund Services Fee Payable 182 Accrued Expenses and Other Liabilities 52,075 -------------------- TOTAL LIABILITIES 1,456,173 -------------------- NET ASSETS Applicable to 247,739,735 Shares of Beneficial Interest Outstanding (par value $0.001, unlimited shares authorized) $247,735,304 ==================== Net Asset Value, Offering and Redemption Price Per Share $1.00 ==================== ANALYSIS OF NET ASSETS Paid-in Capital $247,739,735 Accumulated Net Realized Loss on Investment (4,431) ==================== NET ASSETS $247,735,304 ====================
The Accompanying Notes are an Integral Part of the Financial Statements. 6 J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND STATEMENT OF OPERATIONS - -------------------------------------------------------------------------------- FOR THE YEAR ENDED OCTOBER 31, 2000 INVESTMENT INCOME ALLOCATED FROM PORTFOLIO INCOME Allocated Interest Income $4,798,390 Allocated Portfolio Expenses (124,994) ------------- Net Investment Income Allocated from Portfolio 4,673,396 ------------- FUND EXPENSES Service Organization Fee 185,262 Shareholder Servicing Fee 37,054 Registration Fees 25,995 Administrative Services Fee 17,743 Financial and Fund Accounting Services Fee 12,688 Transfer Agent Fees 12,422 Professional Fees 11,300 Printing Expenses 10,096 Amortization of Organization Expenses 2,469 Fund Services Fee 1,054 Administration Fee 792 Trustees' Fees and Expenses 251 Miscellaneous 3,597 ------------- Total Fund Expenses 320,723 Less: Reimbursement of Expenses (112,238) ------------- Net Fund Expenses 208,485 ------------- NET INVESTMENT INCOME 4,464,911 ------------- NET REALIZED GAIN ON INVESTMENT ALLOCATED FROM PORTFOLIO 37 ------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $4,464,948 =============
The Accompanying Notes are an Integral Part of the Financial Statements. 7 J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND STATEMENT OF CHANGES IN NET ASSETS - -------------------------------------------------------------------------------- FOR THE YEARS ENDED OCTOBER 31
INCREASE (DECREASE) IN NET ASSETS 2000 1999 FROM OPERATIONS Net Investment Income $ 4,464,911 $ 1,301,867 Net Realized Gain (Loss) on Investment Allocated from Portfolio 37 (4,361) ------------------ ----------------- Net Increase in Net Assets Resulting from Operations 4,464,948 1,297,506 ------------------ ----------------- DISTRIBUTIONS TO SHAREHOLDERS FROM Net Investment Income (4,464,911) (1,301,867) Net Realized Gain - (80) ------------------ ----------------- Total Distributions to Shareholders (4,464,911) (1,301,947) ------------------ ----------------- TRANSACTIONS IN SHARES OF BENEFICIAL INTEREST (AT A CONSTANT $1.00 PER SHARE) Proceeds from Shares of Beneficial Interest Sold 465,773,279 235,307,175 Reinvestment of Dividends and Distributions 33,661 328,005 Cost of Shares of Beneficial Interest Redeemed (227,266,130) (255,895,536) ------------------ ----------------- Net Increase (Decrease) from Transactions in Shares of Beneficial Interest 238,540,810 (20,260,356) ------------------ ----------------- Total Increase (Decrease) in Net Assets 238,540,847 (20,264,797) ------------------ ----------------- NET ASSETS Beginning of Year 9,194,457 29,459,254 ------------------ ----------------- End of Year $247,735,304 $9,194,457 ================== =================
The Accompanying Notes are an Integral Part of the Financial Statements. 8 J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND FINANCIAL HIGHLIGHTS - -------------------------------------------------------------------------------- SELECTED DATA FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD ARE AS FOLLOWS:
FOR THE PERIOD NOVEMBER 5, 1997 (COMMENCEMENT FOR THE YEARS ENDED OCTOBER 31 OF OPERATIONS) THROUGH 2000 1999 OCTOBER 31, 1998 -------------------------------------------------------------- NET ASSET VALUE PER SHARE, BEGINNING OF PERIOD $1.00 $1.00 $1.00 -------------------------------------------------------------- INCOME FROM INVESTMENT OPERATIONS Net Investment Income 0.06 0.05 0.05 Net Realized Gain (Loss) on Investment 0.00(a) (0.00)(a) (0.00)(a) -------------------------------------------------------------- Total from Investment Operations 0.06 0.05 (0.05) -------------------------------------------------------------- LESS DISTRIBUTIONS TO SHAREHOLDERS FROM Net Investment Income (0.06) (0.05) (0.05) Net Realized Gain - (0.00)(a) - -------------------------------------------------------------- Total Distributions to Shareholders (0.06) (0.05) (0.05) -------------------------------------------------------------- NET ASSET VALUE PER SHARE, END OF PERIOD $1.00 $1.00 $1.00 ============================================================== RATIOS AND SUPPLEMENTAL DATA Total Return 5.84% 4.70% 5.24%(b) Net Assets, End of Period (in thousands) $247,735 $9,194 $29,459 Ratios to Average Net Assets Net Expenses 0.45% 0.45% 0.45%(c) Net Investment Income 6.03% 4.54% 5.07%(c) Expenses without Reimbursement 0.60% 0.78% 1.32%(c)
(a) Less than $0.005. (b) Not annualized. (c) Annualized. The Accompanying Notes are an Integral Part of the Financial Statements. 9 J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- OCTOBER 31, 2000 - -------------------------------------------------------------------------------- 1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ORGANIZATION -- The J.P. Morgan Institutional Service Federal Money Market Fund (the "Fund'') is a separate series of the J.P. Morgan Institutional Funds, a Massachusetts business trust (the "Trust'') which was organized on November 4, 1992. The Trust is registered under the Investment Company Act of 1940, as amended, as an open-end management investment company. The Fund commenced operations on November 5, 1997. The Fund invests all of its investable assets in The Federal Money Market Portfolio (the "Portfolio''), a diversified open-end management investment company having the same investment objective as the Fund. The value of such investment included in the Statement of Assets and Liabilities reflects the Fund's proportionate interest in the net assets of the Portfolio (approximately 7% at October 31, 2000). The performance of the Fund is directly affected by the performance of the Portfolio. The financial statements of the Portfolio, including the Schedule of Investments, are included elsewhere in this report and should be read in conjunction with the Fund's financial statements. The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts and disclosures. Actual amounts could differ from those estimates. The following is a summary of the significant accounting policies of the Fund: SECURITY VALUATION--Valuation of securities by the Portfolio is discussed in Note 1 of the Portfolio's Notes to Financial Statements that are included elsewhere in this report. INVESTMENT INCOME--The Fund earns income, net of expenses, daily on its investment in the Portfolio. All net investment income, realized and unrealized gains and losses of the Portfolio is allocated pro-rata among the Fund and other investors in the Portfolio at the time of such determination. EXPENSES -- Expenses incurred by the Trust with respect to any two or more Funds in the Trust are allocated in proportion to the net assets of each Fund in the Trust, except where allocations of direct expenses to each Fund can otherwise be made fairly. ORGANIZATION EXPENSES--The Fund incurred organization expenses in the amount of $11,000 which have been deferred and are being amortized on a straight-line basis over a period not to exceed five years beginning with the commencement of operations of the Fund. INCOME TAX STATUS-- It is the Fund's policy to distribute all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under the provisions of the Internal Revenue Code. Accordingly, no provision has been made for federal or state income taxes. DISTRIBUTIONS TO SHAREHOLDERS--Distributions to a shareholder are recorded on the ex-dividend date. Distributions from net investment income are declared daily and paid monthly. Distributions from net short-term realized gains, if any, will be distributed in accordance with the requirements of the Internal Revenue Code of 1986 (the "Code"), as amended, and may be reflected in the Fund's daily dividends. Distributions from net long-term realized gains, if any, will be distributed annually, except that an additional capital gains distribution may be made in a given year to the extent necessary to avoid the imposition of federal excise tax on the Fund. - -------------------------------------------------------------------------------- 2. TRANSACTIONS WITH AFFILIATES ADMINISTRATIVE SERVICES -- The Trust has an Administrative Services Agreement (the "Services Agreement") with Morgan Guaranty Trust Company of New York ("Morgan"), under which Morgan is responsible for certain aspects of the administration and operation of the Fund. Under the Services Agreement, the Trust has agreed to pay Morgan a fee equal to its allocable share of an annual complex-wide charge. This charge is calculated based on the aggregate average daily net assets of the Trust and certain other registered investment companies for which J.P. Morgan Investment Management, Inc. ("JPMIM") acts as investment advisor in accordance with the following annual schedule: 0.09% on the first $7 billion of their aggregate average daily net assets and 0.04% of their aggregate average daily net assets in excess of $7 billion less the complex-wide fees payable to Funds Distributor, Inc. The portion of this charge payable by the Fund is determined by the proportionate share that its net assets bear to the net assets of the Trust and certain other investment companies for which Morgan provides similar services. Morgan has agreed to reimburse the Fund to the extent necessary to maintain the total operating expenses (which excludes interest and dividend expenses, taxes and 10 J.P. MORGAN INSTITUTIONAL SERVICE FEDERAL MONEY MARKET FUND NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- (Continued) OCTOBER 31, 2000 - -------------------------------------------------------------------------------- 2. TRANSACTIONS WITH AFFILIATES (CONTINUED) extraordinary items) of the Fund, including the expenses allocated to the Fund from the Portfolio, at no more than 0.45% of the average daily net assets of the Fund. This reimbursement arrangement can be changed or terminated at any time after February 28, 2001 at the option of Morgan. ADMINISTRATION -- The Trust has retained Funds Distributor, Inc. ("FDI"), a registered broker-dealer, to serve as the co-administrator and distributor for the Fund. Under a Co-Administration Agreement between FDI and the Trust, FDI provides administrative services necessary for the operations of the Fund, furnishes office space and facilities required for conducting the business of the Fund and pays the compensation of the Fund's officers affiliated with FDI. The Fund has agreed to pay FDI fees equal to its allocable share of an annual complex-wide charge of $425,000 plus FDI's out-of-pocket expenses. The portion of this charge payable by the Fund is determined by the proportionate share that its net assets bear to the net assets of the Trust and certain other investment companies for which FDI provides similar services. SHAREHOLDER SERVICING -- The Trust has a Shareholder Servicing Agreement with Morgan under which Morgan provides account administration and personal account maintenance service to Fund shareholders. The agreement provides for the Fund to pay Morgan a fee for these services that is computed daily and paid monthly at an annual rate of 0.10% of the average daily net assets of the Fund The Trust on behalf of the Fund, has a Service Plan with respect to fund shares which authorizes it to compensate Service Organizations for providing account administration and other services to their customers who are beneficial owners of such shares. The Fund will enter into agreements with Service Organizations which purchase shares on behalf of their customers ("Service Agreements"). The Service Agreements provide that the Fund pay Service Organizations a fee which is computed daily and paid monthly at an annual rate of up to 0.25% of the average daily net assets of the Fund with respect to the shares of the Fund attributable to or held in the name of the Service Organization for its customers. FUND SERVICES -- The Trust has a Fund Services Agreement with Pierpont Group, Inc. ("PGI") to assist the Trustees in exercising their overall supervisory responsibilities for the Trust's affairs. The Trustees of the Trust represent all the existing shareholders of PGI. Each Trustee receives an aggregate annual fee of $75,000 for serving on the boards of the Trust, the J.P. Morgan Funds, the J.P. Morgan Institutional Funds, and other registered investment companies in which they invest. The Trustees' Fees and Expenses shown in the financial statements represent the Fund's allocated portion of the total Trustees' fees and expenses. The Trust's Chairman and Chief Executive Officer also serves as Chairman of PGI and receives compensation and employee benefits from PGI. The allocated portion of such compensation and benefits included in the Fund Services Fee shown on the Statement of Operations was $200. - -------------------------------------------------------------------------------- 3. FEDERAL INCOME TAXES For federal income tax purposes, the Fund had a capital loss carryforward as of October 31, 2000, of approximately $4,351 which expires in 2007. Accordingly, no capital gains distribution is expected to be paid to shareholders until net gains have been realized in excess of this amount. - -------------------------------------------------------------------------------- 4. SUBSEQUENT EVENTS On September 13, 2000, J.P. Morgan & Co. Incorporated and The Chase Manhattan Corporation announced that they have entered into an agreement and plan of merger. The transaction is expected to close in December 2000 and is subject to approval by shareholders of both companies. 11 REPORT OF INDEPENDENT ACCOUNTANTS - -------------------------------------------------------------------------------- To the Trustees and Shareholders of J.P. Morgan Institutional Service Federal Money Market Fund In our opinion, the accompanying statement of assets and liabilities and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of J.P. Morgan Institutional Service Federal Money Market Fund (one of the series constituting part of the J.P. Morgan Institutional Funds, hereafter referred to as the "Fund") at October 31, 2000, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the two years in the period then ended and for the period November 5, 1997 (commencement of operations) through October 31, 1998, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fund's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP New York, New York December 21, 2000 12 THE FEDERAL MONEY MARKET PORTFOLIO Annual Report October 31, 2000 (The following pages should be read in conjunction with J.P. Morgan Institutional Service Federal Money Market Fund Annual Financial Statements) 13 THE FEDERAL MONEY MARKET PORTFOLIO - SCHEDULE OF INVESTMENTS - -------------------------------------------------------------------------------- OCTOBER 31, 2000
PRINCIPAL AMOUNT VALUE - -------------------------------------------------------------------------------- U.S. GOVERNMENT AGENCY SECURITIES - 100.0% $100,000,000 FFCB, 6.35%, 2/1/01 $ 99,986,186 88,300,000 FFCB, 6.60%, 3/1/01 88,295,306 2,075,000 FFCB, 5.13%, 4/2/01 50,000,000 FFCB, 5.88%, 7/2/01 49,755,712 250,000,000 FFCB Undivided Interest in Demand Note, 6.47%, 7/3/01 249,999,999 144,354,000 FFCB Discount Notes, 6.42%-6.52%, 11/3/00 to 3/8/01(y) 142,912,762 35,000,000 FFCB, Floater, 6.50%, 11/1/00, resets daily off PRIME minus 3.00% with no caps 34,997,150 40,000,000 FFCB, Floater, 6.58%, 11/1/00, resets daily off PRIME minus 2.925% with no caps 39,998,661 25,000,000 FFCB, VRN, 6.45%, 11/10/00, resets monthly off the 1-month LIBOR minus 0.17% with no caps 24,998,919 100,000,000 FFCB, VRN, 6.43%, 11/11/00, resets monthly off the 1-month LIBOR minus 0.19% with no caps 99,981,558 100,000,000 FFCB, VRN, 6.44%, 11/25/00, resets monthly off the 1-month LIBOR minus 0.19% with no caps 100,000,000 47,370,000 FHLB, 4.98%, 11/17/00 47,343,182 40,000,000 FHLB, 6.67%, 4/6/01 39,999,825 50,000,000 FHLB, 6.50%, 4/26/01 49,973,943 1,468,753,000 FHLB Discount Notes, 6.41%-6.62%, 11/1/00 to 3/7/01(y) 1,454,282,870 130,000,000 FHLB, Floater, 6.47%, 11/1/00, resets daily off PRIME minus 3.03% with no caps 129,943,437 100,000,000 FHLB, Floater, 6.49%, 11/1/00, resets quarterly off the 3-month LIBOR minus 0.22% with no caps 99,954,997 100,000,000 FHLB, Floater, 6.42%, 11/15/00, resets monthly off the 1-month LIBOR minus 0.20% with no caps 99,945,548 50,000,000 FHLB, Floater, 6.43%, 11/17/00, resets monthly off the 1-month LIBOR minus 0.19% with no caps 49,978,795 100,000,000 FHLB, Floater, 6.43%, 11/26/00, resets monthly off the 1-month LIBOR minus 0.19% with no caps 99,947,146 125,000,000 FHLB, Floater, 6.55%, 1/19/01, resets quarterly off the 3-month LIBOR minus 0.22% with no caps 124,917,726
PRINCIPAL AMOUNT VALUE - -------------------------------------------------------------------------------- $200,000,000 FHLB, VRN, 6.50%, 11/1/00, resets daily off PRIME minus 3.00% with no caps $ 199,984,280 100,000,000 FHLB, VRN, 6.50%, 11/1/00, resets daily off PRIME minus 3.01% with no caps 99,993,600 100,000,000 FHLB, VRN, 6.43%, 11/20/00, resets monthly off the 3-month T-Bill rate minus 0.19% with no caps 99,956,932 130,609,000 SLMA Discount Notes, 6.42%-6.45%, 11/1/00 to 11/22/00(y) 130,329,883 47,398,000 SLMA, MTN, 6.55%, 2/14/01 47,393,344 ----------------------- TOTAL INVESTMENTS AT AMORTIZED COST AND VALUE - 100.0% $3,706,932,326 =======================
(Cost $3,706,932,326) FHLB - Federal Home Loan Bank FFCB - Federal Farm Credit Bank LIBOR - London Interbank Offered Rate MTN - Medium Term Note resets - The frequency with which a security's coupon changes, based on current market conditions or an underlying index. SLMA - Student Loan Marketing Association VRN - Variable Rate Note. Interest reset date is indicated and used in calculating the weighted average portfolio maturity. Rate shown is effective October 31, 2000. (y) Yield at Maturity The Accompanying Notes are an Integral Part of the Financial Statements. 14 THE FEDERAL MONEY MARKET PORTFOLIO STATEMENT OF ASSETS AND LIABILITIES - -------------------------------------------------------------------------------- OCTOBER 31, 2000 ASSETS Investments at Amortized Cost and Value $3,706,932,326 Dividend and Interest Receivable 15,762,543 Prepaid Trustees' Fees and Expenses 2,430 Prepaid Expenses and Other Assets 3,456 --------------- TOTAL ASSETS 3,722,700,755 --------------- LIABILITIES Due to Custodian 1,281,747 Advisory Fee Payable 411,493 Administration Service Fee Payable 78,222 Fund Services Fee Payable 2,546 Administration Fee Payable 1,036 Accrued Expenses and Other Liabilities 124,426 --------------- TOTAL LIABILITIES 1,899,470 --------------- NET ASSETS Applicable to Investors' Beneficial Interests $3,720,801,285 ===============
The Accompanying Notes are an Integral Part of the Financial Statements. 15 THE FEDERAL MONEY MARKET PORTFOLIO STATEMENT OF OPERATIONS - -------------------------------------------------------------------------------- FOR THE YEAR ENDED OCTOBER 31, 2000 INVESTMENT INCOME INCOME Interest Income $187,204,325 --------------- EXPENSES Advisory Fee 4,031,308 Administrative Services Fee 735,431 Custodian Fees and Expenses 315,249 Professional Fees 53,051 Fund Services Fee 46,373 Trustees' Fees and Expenses 32,457 Administration Fee 19,778 Printing Expenses 9,583 Insurance Expenses 3,813 Miscellaneous 646 --------------- Total Expenses 5,247,689 --------------- NET INVESTMENT INCOME 181,956,636 --------------- NET REALIZED GAIN ON INVESTMENTS 5,077 --------------- NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $181,961,713 ===============
The Accompanying Notes are an Integral Part of the Financial Statements. 16 THE FEDERAL MONEY MARKET PORTFOLIO STATEMENT OF CHANGES IN NET ASSETS - -------------------------------------------------------------------------------- FOR THE YEARS ENDED OCTOBER 31
INCREASE IN NET ASSETS 2000 1999 FROM OPERATIONS Net Investment Income $ 181,956,636 $ 90,037,557 Net Realized Gain (Loss) on Investments 5,077 (93,004) ----------------- ------------------- Net Increase in Net Assets Resulting from Operations 181,961,713 89,944,553 ----------------- ------------------- TRANSACTIONS IN INVESTORS' BENEFICIAL INTERESTS Contributions 15,453,027,028 9,653,493,366 Withdrawals (14,195,010,506) (8,926,190,523) ----------------- ------------------- Net Increase from Investors' Transactions 1,258,016,522 727,302,843 ----------------- ------------------- Total Increase in Net Assets 1,439,978,235 817,247,396 ----------------- ------------------- NET ASSETS Beginning of Year 2,280,823,050 1,463,575,654 ----------------- ------------------ End of Year $3,720,801,285 $2,280,823,050 ================= ==================
SUPPLEMENTARY DATA
FOR THE YEARS ENDED OCTOBER 31 2000 1999 1998 1997 1996 --------------------------------------------------------- Ratios to Average Net Assets Net Expenses 0.17% 0.20% 0.20% 0.20% 0.20% Net Investment Income 6.00% 4.85% 5.31% 5.18% 5.08% Expenses without Reimbursement 0.17% 0.20% 0.25% 0.28% 0.27%
The Accompanying Notes are an Integral Part of the Financial Statements. 17 THE FEDERAL MONEY MARKET PORTFOLIO NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- OCTOBER 31, 2000 - -------------------------------------------------------------------------------- 1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES ORGANIZATION -- The Federal Money Market Portfolio (the "Portfolio") is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management investment company which was organized as a trust under the laws of the State of New York on November 4, 1992. The Portfolio's investment objective is to provide high current income consistent with the preservation of capital and same- day liquidity. The Portfolio commenced operations on January 4, 1993. The Declaration of Trust permits the Trustees to issue an unlimited number of beneficial interests in the Portfolio. The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts and disclosures. Actual amounts could differ from those estimates. The following is a summary of the significant accounting policies of the Portfolio: SECURITY VALUATIONS -- Investments are valued at amortized cost which approximates market value. The amortized cost method of valuation values a security at its cost at the time of purchase and thereafter assumes a constant amortization to maturity of any discount or premium, regardless of the impact of fluctuating interest rates on the market value of the instruments. SECURITY TRANSACTIONS -- Security transactions are accounted for as of the trade date. Realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes. INVESTMENT INCOME -- Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums. INCOME TAX STATUS -- The Portfolio intends to be treated as a partnership for federal income tax purposes. As such, each investor in the Portfolio will be taxed on its share of the Portfolio's ordinary income and capital gains. It is intended that the Portfolio's assets will be managed in such a way that an investor in the Portfolio will be able to satisfy the provisions of the Internal Revenue Code. - -------------------------------------------------------------------------------- 2. TRANSACTIONS WITH AFFILIATES ADVISORY -- The Portfolio has an Investment Advisory Agreement with J.P. Morgan Investment Management, Inc. ("JPMIM"), an affiliate of Morgan Guaranty Trust Company of New York ("Morgan") and a wholly owned subsidiary of J.P. Morgan & Co. Incorporated ("J.P. Morgan"). Under the terms of the agreement, the Portfolio pays JPMIM at an annual rate of 0.20% of the Portfolio's average daily net assets up to $1 billion and 0.10% on any excess over $1 billion. ADMINISTRATIVE SERVICES -- The Portfolio has an Administrative Services Agreement (the "Services Agreement") with Morgan under which Morgan is responsible for certain aspects of the administration and operation of the Portfolio. Under the Services Agreement, the Portfolio has agreed to pay Morgan a fee equal to its allocable share of an annual complex-wide charge. This charge is calculated based on the aggregate average daily net assets of the Portfolio and certain other registered investment companies for which JPMIM acts as investment advisor in accordance with the following annual schedule: 0.09% on the first $7 billion of their aggregate average daily net assets and 0.04% of their aggregate average daily net assets in excess of $7 billion less the complex-wide fees payable to Funds Distributor, Inc. The portion of this charge payable by the Portfolio is determined by the proportionate share that its net assets bear to the net assets of the Trust and certain other investment companies for which Morgan provides similar services. ADMINISTRATION -- The Portfolio has retained Funds Distributor, Inc. ("FDI"), a registered broker-dealer, to serve as the co-administrator and distributor for the Fund. Under a Co-Administration Agreement between FDI and the Portfolio, FDI provides administrative services necessary for the operations of the Portfolio, furnishes office space and facilities required for conducting the business of the Portfolio and pays the compensation of the Portfolio's officers affiliated with FDI. The Portfolio has agreed to pay FDI fees equal to its allocable share of an annual complex-wide charge of $425,000 plus FDI's out-of-pocket expenses. The portion of this charge payable by the Portfolio is determined by the proportionate share that its net assets bear to the net assets of the Trust and certain other investment companies for which FDI provides similar services. FUND SERVICES -- The Portfolio has a Fund Services Agreement with Pierpont Group, Inc. ("PGI") to assist the Trustees in exercising their overall supervisory responsibilities for the Portfolio's affairs. The Trustees of the Portfolio represent all the existing shareholders of PGI. 18 THE FEDERAL MONEY MARKET PORTFOLIO NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- (Continued) OCTOBER 31, 2000 - -------------------------------------------------------------------------------- 2. TRANSACTIONS WITH AFFILIATES (CONTINUED) Each Trustee receives an aggregate annual fee of $75,000 for serving on the boards of the Trust, the J.P. Morgan Funds, the J.P. Morgan Institutional Funds, and other registered investment companies in which they invest. The Trustees' Fees and Expenses shown in the financial statements represent the Fund's allocated portion of the total Trustees' fees and expenses. The Trust's Chairman and Chief Executive Officer also serves as Chairman of PGI and receives compensation and employee benefits from PGI. The allocated portion of such compensation and benefits included in the Fund Services Fee shown on the Statement of Operations was $8,800. - -------------------------------------------------------------------------------- 3. SUBSEQUENT EVENTS On September 13, 2000, J.P. Morgan & Co. Incorporated and The Chase Manhattan Corporation announced that they have entered into an agreement and plan of merger. The transaction is expected to close in December 2000 and is subject to approval by shareholders of both companies. 19 REPORT OF INDEPENDENT ACCOUNTANTS - -------------------------------------------------------------------------------- To the Trustees and Investors of The Federal Money Market Portfolio In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the supplementary data present fairly, in all material respects, the financial position of The Federal Money Market Portfolio (the "Portfolio") at October 31, 2000, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the supplementary data for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and supplementary data (hereafter referred to as "financial statements") are the responsibility of the Portfolio's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with auditing standards generally accepted in the United States of America, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at October 31, 2000 by correspondence with the custodian, provide a reasonable basis for our opinion. PricewaterhouseCoopers LLP New York, New York December 21, 2000 20 [back cover] J.P. MORGAN INSTITUTIONAL SERVICE FUNDS Prime Money Market Fund --------------------------------------------------------------------- Treasury Money Market Fund --------------------------------------------------------------------- Federal Money Market Fund --------------------------------------------------------------------- Tax Exempt Money Market Fund --------------------------------------------------------------------- For more information on the J.P. Morgan Institutional Funds, call J.P. Morgan Funds Services at (800) 766-7722. --------------------------------------------------------------------- Morgan Guaranty Trust Company MAILING 500 Stanton Christiana Road INFORMATION Newark, Delaware 19713-2107 IN-ANN-23754 1000 -----END PRIVACY-ENHANCED MESSAGE-----