The JPM Institutional Funds
Supplement dated December 27, 1996, as applicable to the following Prospectuses:
The JPM Institutional Treasury Money Market Fund, dated 3/1/96
The JPM Institutional Money Market Fund, dated 3/1/96
The JPM Institutional Short Term Bond Fund, dated 3/1/96
The JPM Institutional Bond Fund, dated 3/1/96
The JPM Institutional New York Total Return Bond Fund, dated 8/1/96
The JPM Institutional Diversified Fund, dated 9/27/96
The JPM Institutional Selected U.S. Equity Fund, dated 9/27/96
The JPM Institutional U.S. Small Company Fund, dated 9/27/96
The JPM Institutional International Equity Fund, dated 3/1/96
The JPM Institutional Emerging Markets Equity Fund, dated 3/1/96
The JPM Institutional European Equity Fund, dated 9/11/96
The JPM Institutional Japan Equity Fund, dated 9/11/96
The JPM Institutional Asia Growth Fund, dated 9/11/96
(Supersedes all supplements dated prior to December 27, 1996)
1. The following changes were effective as of August 1, 1996 with respect to the
Prospectuses for the Treasury Money Market, Money Market, Short Term Bond, Bond,
International Equity and Emerging Markets Equity Funds:
The Fund's address is 60 State Street, Suite 1300, Boston, Massachusetts 02109.
Administrative functions formerly provided to the Fund by Signature
Broker-Dealer Services, Inc. are provided by Funds Distributor, Inc. ("FDI") or
Morgan, and FDI became the distributor of the Fund and exclusive placement agent
for the Fund's corresponding Portfolio. FDI, a registered broker-dealer, is a
wholly owned indirect subsidiary of Boston Institutional Group, Inc. In
addition, certain accounting services provided by Morgan are being provided by
State Street Bank and Trust Company.
The Fund will continue to invest all its assets in its corresponding Portfolio
and will operate in a master-feeder structure. These changes include an increase
in fees payable to Morgan that is offset by a decrease in other fees with the
result that there is no adverse impact on the expenses of the Fund.
2. The following footnote is inserted directly beneath the Shareholder
Transaction Expense table with reference to Sales Load Imposed on Purchases:
* Certain eligible Institutions (defined below) may impose fees in connection
with the purchase of the Fund's shares through such institutions.
<PAGE>
3. The following replaced the "Expense Table" and "Example" in the Short Term
Bond Fund Prospectus effective as of July 1, 1996:
Effective July 1, 1996 the Total Annual Operating Expenses of the Fund were
reduced to 0.25%. The Expense Table and Example for the Fund are revised as
follows:
Expense Table
Annual Operating Expenses
Advisory fees...................................................... 0.25%
Rule 12b-1 fees.................................................... None
Other Expenses (after expense reimbursement) ...................... 0.00%
Total Operating Expenses (after expense reimbursement) ............ 0.25%
Example
An investor would pay the following expenses on a $1,000 investment, assuming
(1) 5% annual return and (2) redemption at the end of each time period:
1 year ............................................................ $3
3 years ........................................................... $8
5 years ........................................................... $14
10 years .......................................................... $32
The "Expenses" section in the Short Term Bond Fund Prospectus is revised to
reflect the following:
Effective July 1, 1996 through at least February 28, 1997, Morgan will reimburse
the Fund to the extent necessary to maintain the Fund's total operating expenses
(which includes expenses of the Fund and the Portfolio) at the annual rate of
0.25% of the Fund's average daily net assets.
<PAGE>
4. The following restates the sentence regarding the rate of Total Operating
Expenses without expense reimbursements in the footnote to the "Expense Table"
in the Prospectus for each Fund listed below as applicable to the Fund described
in such Prospectus:
If the above expense table reflected these expenses without current
reimbursements, Other Expenses and Total Operating Expenses would be equal on an
annual basis to the following respective percentages of such assets of the Fund:
Other Expenses Total Operating Expenses
Treasury Money Market Fund 0.31% 0.51%
Money Market Fund 0.21% 0.33%
Short Term Bond Fund 1.04% 1.29%
Bond Fund 0.37% 0.67%
International Equity Fund 0.45% 1.05%
<PAGE>
5. The following is inserted as the first column in the "Financial Highlights"
table in the Prospectus for each Fund listed below as applicable to the Fund
described in such Prospectus:
<TABLE>
<CAPTION>
Treasury Money Market
Fund Money Market Fund
For the Six Months Ended For the Six Months Ended
April 30, 1996 (unaudited) May 31, 1996 (unaudited)
-------------------------- ------------------------
<S> <C> <C>
Net Asset Value, Beginning
of Period $1.00 $1.00
----- -----
Income From Investment
Operations:
Net Investment Income 0.0257 0.0267
Net Realized Gain (Loss) on
Investment 0.0003 0.0000 (a)
------ ------
Total from Investment
Operations 0.0260 0.0267
------ ------
Less Distributions to
Shareholders From:
Net Investment Income (0.0257) (0.0267)
Net Realized Gain (0.0003) (0.0003)
-------- --------
Total Distributions to
Shareholders (0.0260) (0.0270)
-------- --------
Net Asset Value, End of
Period $1.00 $1.00
===== =====
Total Return 2.62% (b) 2.73% (b)
Ratios and Supplemental
Data:
Net Assets, End of Period (in
thousands) $184,451 $1,239,517
Ratios to Average Net Assets
Expenses 0.20% (c) 0.20% (c)
Net Investment Income 5.18% (c) 5.33% (c)
Decrease Reflected in
Expense Ratio due to
Expense Reimbursement 0.23% (c) 0.12% (c)
(a) Less than $0.0001. (b) Not Annualized. (c) Annualized.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Short Term Bond Fund Bond Fund
For the Six Months Ended For the Six Months Ended
April 30, 1996 (unaudited) April 30, 1996 (unaudited)
-------------------------- --------------------------
<S> <C> <C>
Net Asset Value, Beginning
of Period $9.83 $9.98
----- -----
Income From Investment
Operations:
Net Investment Income 0.28 0.30
Net Realized and Unrealized
Gain (Loss) on Investment (0.07) (0.27)
------ ------
Total from Investment
Operations 0.21 0.03
---- ----
Less Distributions to
Shareholders From:
Net Investment Income (0.28) (0.30)
Net Realized Gain -- (0.03)
Total Distributions to
Shareholders (0.28) (0.33)
------ ------
Net Asset Value, End of
Period: $9.76 $9.68
===== =====
Total Return 2.09% (a) 0.26% (a)
Ratios and Supplemental
Data:
Net Assets, End of Period (in
thousands) $6,221 $618,649
Ratios to Average Net Assets
Expenses 0.45% (b) 0.50% (b)
Net Investment Income 5.61% (b) 6.18% (b)
Decrease Reflected in
Expense Ratio due to
Expense Reimbursement 0.80% (b) 0.01% (b)
(a) Not Annualized. (b) Annualized.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Emerging Markets Equity Fund
International Equity Fund For the Six Months Ended
For the Six Months Ended April 30, 1996 (unaudited)
April 30, 1996 (unaudited)
-------------------------- -----------------------------
<S> <C> <C>
Net Asset Value, Beginning
of Period $10.44 $9.71
------ -----
Income From Investment
Operations:
Net Investment Income 0.04 0.04
Net Realized and Unrealized
Gain (Loss) on Investment
and Foreign Currency 1.38 1.12
---- ----
Total from Investment
Operations 1.42 1.16
---- ----
Less Distributions to
Shareholders From:
Net Investment Income (0.24) (0.08)
Net Realized Gain (0.06) --
Total Distributions to
Shareholders (0.30) (0.08)
------ ------
Net Asset Value, End of
Period $11.56 $10.79
====== ======
Total Return 13.82% (a) 12.04% (a)
Ratios and Supplemental
Data:
Net Assets, End of Period (in
thousands) $677,023 $249,002
Ratios to Average Net Assets
Expenses 0.92% (b) 1.39% (b)
Net Investment Income 0.89% (b) 1.00% (b)
Decrease Reflected in
Expense Ratio due to
Expense Reimbursement -- --
(a) Not Annualized. (b) Annualized.
</TABLE>
<PAGE>
6. The last sentence of the second paragraph under the caption "Investment
Objective and Policies" in the Prospectus for the U.S. Small Company Fund is
replaced in its entirety with the following:
The small company holdings of the Portfolio are primarily companies included in
the market capitalization size range of the Russell 2500 Index.
7. The following sentence under "Management of the Trust and the Portfolios" is
revised in each Prospectus referenced above as follows:
Through offices in New York City and abroad, J.P. Morgan, through the Advisor
and other subsidiaries, offers a wide range of services to governmental,
institutional, corporate and individual customers and acts as investment adviser
to individual and institutional clients with combined assets under management of
over $197 billion (of which the Advisor advises over $30 billion).
8. Portfolio manager biographies as applicable to each of the Prospectuses
of the Funds described below are revised as follows:
The Money Market Fund: Robert R. Johnson, Vice President (since June, 1988,
employed by Morgan since prior to 1991) and Daniel B. Mulvey, Vice President
(since January, 1995, employed by Morgan since September, 1991).
The Treasury Money Market Fund: Robert R. Johnson, Vice President (since
January, 1993, employed by Morgan since prior to 1991) and Daniel B. Mulvey,
Vice President (since October, 1996, employed by Morgan since September, 1991).
The U.S. Small Company Fund: James B. Otness, Managing Director (since February,
1993, employed by Morgan since prior to 1991 as a portfolio manager of equity
securities of small and medium sized U.S. companies); Michael J. Kelly, Vice
President (since May, 1996, employed by Morgan since prior to 1991 as a
portfolio manager of small and medium sized U.S. companies and an equity
research analyst); and Candice Eggerss, Vice President (since May, 1996,
employed by Morgan since May, 1996 previously employed by Weiss, Peck and Greer
from June 1993 to May 1996 and Equitable Capital Management prior to June 1993).
The Emerging Markets Equity Fund: Douglas J. Dooley, Managing Director (since
November 1993, employed by Morgan since prior to 1991 and has been a portfolio
manager of emerging markets investment since 1991); Satyen Mehta, Vice President
(since November, 1993, employed by Morgan since prior to 1991 and has been a
portfolio manager of emerging markets investments since 1991); and Alejandro J.
Baez-Sacasa, Vice President (since April, 1995, employed by Morgan since prior
to 1991).
<PAGE>
9. The following is added to the section entitled "Shareholder Servicing" in
each Prospectus referenced above:
The Fund may be sold to or through Eligible Institutions, including financial
institutions and broker-dealers, that may be paid fees by Morgan or its
affiliates for services provided to their clients that invest in the Fund.
Organizations that provide recordkeeping or other services to certain employee
benefit or retirement plans that include the Fund as an investment alternative
may also be paid a fee.
10. The following section under "Purchase of Shares" is amended in its entirety
as applicable to the Fund described in each Prospectus referenced above:
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 agent for the customer.
All purchase orders must be accepted by the Distributor. Investors must be
either customers of Morgan or of an Eligible Institution or employer-sponsored
retirement plans that have designated the Fund as investment option for the
plans. 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.
The Fund requires the minimum initial investment shown below and a minimum
subsequent investment of $25,000:
Fund Initial Investment
- ---- ------------------
The JPM Institutional Money Market Fund $10,000,000
The JPM Institutional Treasury Money Market Fund $10,000,000
The JPM Institutional Short Term Bond Fund $ 5,000,000
The JPM Institutional Bond Fund $ 5,000,000
The JPM Institutional New York Total Return Bond Fund $ 5,000,000
The JPM Institutional Selected U.S. Equity Fund $ 3,000,000
The JPM Institutional U.S. Small Company Fund $ 1,000,000
The JPM Institutional International Equity Fund $ 1,000,000
The JPM Institutional Emerging Markets Equity Fund $ 500,000
The JPM Institutional Diversified Fund $ 3,000,000
The JPM Institutional Japan Equity Fund $ 1,000,000
The JPM Institutional European Equity Fund $ 1,000,000
The JPM Institutional Asia Growth Fund $ 500,000
<PAGE>
These minimum investment requirements may be waived for certain investors,
including investors for whom the Advisor is a fiduciary, who maintain related
accounts with the Funds or the Advisor, who make investments for a group of
clients, such as financial advisors, trust companies and investment advisors, or
who maintain retirement accounts with the Funds.
11. All references to The Pierpont Funds and a Pierpont Fund under the captions
"Management of the Trust and the Portfolio(s)" and "Exchange of Shares" are
changed to "The JPM Pierpont Funds" and "JPM Pierpont Fund," respectively, in
each Prospectus referenced above.
12. The following is inserted at the end of the sub-section entitled "Eligible
Institutions" under the "Purchase of Shares" section in each Prospectus
referenced above:
Although there is no sales charge levied directly by the Fund, Eligible
Institutions may establish their own terms and conditions for providing their
services and may charge investors a transaction-based or other fee for their
services. Such charges may vary among Eligible Institutions but in all cases
will be retained by the Eligible Institution and not remitted to the Fund or
Morgan.
13. Any reference to control persons under the caption "Organization" as
applicable to the Fund described in each Prospectus above is deleted.
