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EXHIBIT 99.2
CODE OF ETHICS
The J.P. Morgan Family of Funds
1. Purposes
This Code of Ethics (the "Code") has been adopted by the Trustees of
the funds listed on Schedule A hereto (each, a "Portfolio"), in accordance with
Rule 17j-1(c) promulgated under the Investment Company Act of 1940, as amended
(the "Act"). Rule 17j-1 under the Act generally proscribes fraudulent or
manipulative practices with respect to purchases or sales of Securities Held or
to be Acquired by investment companies, if effected by associated persons of
such companies. The purpose of this Code is to provide regulations and
procedures consistent with the Act and Rule 17j-1 designed to give effect to the
general prohibitions set forth in Rule 17j-1(b) as follows:
It is unlawful for any affiliated person of or principal underwriter
for a fund, or any affiliated person of an investment adviser of or principal
underwriter for a fund, in connection with the purchase or sale, directly or
indirectly, by the person of a Security Held or to be Acquired by such fund --
(a) To employ any device, scheme or artifice to defraud the fund;
(b) To make any untrue statement of a material fact to the fund or
omit to state a material fact necessary in order to make the
statements made to the fund, in light of the circumstances under
which they are made, not misleading;
(c) To engage in any act, practice, or course of business that
operates or would operate as a fraud or deceit on the fund; or
(d) To engage in any manipulative practice with respect to the fund.
2. Definitions
(a) "Access Person" means any Trustee, officer or Advisory Person of the
Portfolio.
(b) Adviser shall mean J.P. Morgan Investment Management, Inc.
(c) "Advisory Person" of a Portfolio means: (i) any employee of the Portfolio
(or any company in a control relationship to the Portfolio) who, in connection
with his or her regular functions or duties, makes, participates in, or obtains
information regarding the purchase or sale of Covered Securities by the
Portfolio, or whose functions relate to the making of any recommendations with
respect to such purchases or sales; and (ii) any natural person in a control
relationship to the Portfolio who obtains information concerning recommendations
made to the Portfolio with regard to the purchase or sale of Covered Securities
by the Portfolio.
(d) "Beneficial Ownership" shall be interpreted in the same manner as it would
be under Exchange Act Rule 16a-1(a)(2)in determining whether a person is the
beneficial owner of a security for purposes of Section 16 of the Securities
Exchange Act of 1934 and the rules and regulations thereunder (see Annex A). Any
report required by Section 5(a) of this Code may contain a statement that the
report will not be construed as an admission that the person making the report
has any direct or indirect beneficial ownership in the Security to which the
report relates.
(e) "Covered Security" shall have the meaning set forth in Section 2(a)(36) of
the Act, except that it shall not include shares of open-end funds, direct
obligations of the United States Government, bankers' acceptances, bank
certificates of deposit, commercial paper and high quality short-term debt
instruments, including repurchase agreements.
(f) "Control" has the same meaning as in Section 2(a)(9) of the Act.
(g) "Disinterested Trustee" means a Trustee of the Portfolio who is not an
"interested person" of the Portfolio within the meaning of Section 2(a)(19) of
the Act.
(h) "Initial Public Offering" means an offering of securities registered under
the Securities Act of 1933, the issuer of which, immediately before the
registration, was not subject to the reporting requirements of Sections 13 or
15(d) of the Securities Exchange Act.
(i) "Investment Personnel" means (i) any employee of the Portfolio (or of any
company in a control relationship to the Portfolio) who, in connection with his
or her regular functions or duties, makes or participates in making
recommendations regarding the purchase or sale of securities by the Portfolio;
and (ii) any natural person who controls the Portfolio and who obtains
information concerning recommendations made to the Portfolio regarding the
purchase or sale of securities by the Portfolio.
(j) "Limited Offering" means an offering that is exempt from registration under
the Securities Act pursuant to Section 4(2) or Section 4(6) or pursuant to Rule
504, Rule 505, or Rule 506 under the Securities Act.
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(k) "Purchase or Sale of a Covered Security" includes, inter alia, the writing
of an option to purchase or sell a Covered Security.
(l) "Security Held or to be Acquired" by a Portfolio means: (i) any Covered
Security which, within the most recent 15 days, is or has been held by the
Portfolio or is being or has been considered by the Portfolio or its adviser for
purchase by the Portfolio; and (ii) any option to purchase or sell, and any
security convertible into or exchangeable for, a Covered Security described in
Section 2(k)(i) of this Code.
3. Prohibited Purchases and Sales
(a) No Access Person shall purchase or sell directly or indirectly any
Covered Security in which he or she has, or by reason of such transaction
acquires, any direct or indirect Beneficial Ownership and which to his or her
actual knowledge at the time of such purchase or sale:
(i) is being considered for purchase or sale by the Portfolio; or
(ii) is being purchased or sold by the Portfolio.
(b) No Access Person shall reveal to any other person (except in the normal
course of his or her duties on behalf of the Portfolio) any information
regarding Covered Securities transactions by the Portfolio or consideration by
the Portfolio or its adviser of any such Covered Securities transactions.
(c) No Access Person shall recommend any Covered Securities transaction by
the Portfolio without having disclosed his or her interest, if any, in such
Covered Securities or the issuer thereof, including without limitation (i) his
or her direct or indirect Beneficial Ownership of any Covered Securities of such
issuer, (ii) any contemplated transaction by such person in such Covered
Securities (iii) any position with such issuer or its affiliates and (iv) any
present or proposed business relationship between such issuer or its affiliates,
on the one hand, and such person or any party in which such person has a
significant interest, on the other; provided, however, that in the event the
interest of such Access Person in such Covered Securities or issuer is not
material to his or her personal net worth and any contemplated transaction by
such person in such Covered Securities cannot reasonably be expected to have a
material adverse effect on any such transaction by the Portfolio or on the
market for the Covered Securities generally, such Access Person shall not be
required to disclose his or her interest in the Covered Securities or issuer
thereof in connection with any such recommendation.
(d) No Investment Personnel shall purchase any Covered Security which is part
of an Initial Public Offering or a Limited Offering.
4. Exempted Transactions
The prohibitions of Section 3 of this Code shall not apply to:
(a) Purchases or sales effected in any account over which the Access Person
has no direct or indirect influence or control.
(b) Purchases or sales of Covered Securities which are not eligible for
purchase or sale by the Portfolio.
(c) Purchases or sales which are non-volitional on the part of either the
Access Person or the Portfolio.
(d) Purchases which are part of an automatic dividend reinvestment plan.
(e) Purchases effected upon the exercise of rights issued by an issuer pro
rata to all holders of a class of its Covered Securities, to the extent such
rights were acquired from such issuer, and sales of such rights so acquired.
(f) Purchases or sales which are only remotely potentially harmful to the
Portfolio because they would be very unlikely to affect a highly institutional
market, or because they clearly are not related economically to the Covered
Securities to be purchased, sold or held by the Portfolio.
5. Reporting Requirements
(a) Every Access Person must report to the Adviser's compliance department in
accordance with Section 5(d) of this Code:
(i)Initial Holdings Reports. No later than 10 days after the
person becomes an Access Person, the following information: (A)
the title, number of shares and principal amount of each Covered
Security in which the Access Person had any direct or indirect
beneficial ownership when the person became an Access Person; (B)
the name of any broker, dealer or bank with whom the Access
Person maintained an account in which any Covered Securities were
held for the direct or indirect benefit of the Access Person as
of the date the person became an Access Person; and (C) the date
that the report is submitted by the Access Person.
(ii) Quarterly Transaction Reports. No later than 10 days after
the end of a calendar quarter, with respect to any transaction
during the quarter in a Covered Security in which the Access
Person had any direct or indirect Beneficial Ownership: (A) the
date of the transaction, the title, the interest rate and
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maturity date (if applicable), the number of shares and principal
amount of each Covered Security involved; (B) the nature of the
transaction; (C) the price of the Covered Security at which the
transaction was effected; (D) the name of the broker, dealer or
bank with or through which the transaction was effected; and (E)
the date that the report is submitted by the Access Person.
(iii) New Account Report. With respect to any account established
by the Access Person in which any Covered Securities were held
during the calendar quarter for the direct or indirect benefit of
the Access Person: (A) the name of the broker, dealer or bank
with whom the Access Person established the account; (B) the date
the account was established; and (C) the date that the report is
submitted by the Access Person. Such report shall be filed no
later than 10 days after the end of each calendar quarter.
(iv) Annual Holdings Report. Annually, the following information
(which information must be current as of a date no more than 30
days before the report is submitted): (A) the title, number of
shares and principal amount of each Covered Security in which the
Access Person had any direct or indirect beneficial ownership;
(B) the name of any broker, dealer or bank with whom the Access
Person maintains an account in which any Covered Securities are
held for the direct or indirect benefit of the Access Person: and
(C) the date that the report is submitted by the Access Person.
(b) Exceptions from the Reporting Requirements.
(i) Notwithstanding the provisions of Section 5(a), no Access Person shall be
required to make:
A. a report with respect to transactions effected for any account
over which such person does not have any direct or indirect
influence or control;
B. to make a Quarterly Transaction or New Account Report under
Section 5(a)(ii) or (iii) if the report would duplicate
information contained in broker trade confirmations or account
statements received by the Adviser with respect to the Access
Person no later than 10 days after the calendar quarter end, if
all of the information required by Sections 5(a)(ii) or (ii), as
the case may be, is contained in the broker trade confirmations
or account statements, or in the records of the Adviser.
(ii) a Disinterested Trustee who would be required to make a report solely by
reason of being a Trustee need not make:
A. an initial holdings report and annual holdings reports; and
B. quarterly transaction and new account reports, since the Trustees
generally have no involvement in the security selection process.
Such reports need to be filed only if a Trustee, at the time of
that transaction, knew, or in the ordinary course of fulfilling
his or her official duties as a Trustee of the Portfolio, should
have known, that during the 15-day period immediately before or
after the date of the Trustee's transaction in a Covered
Security, such Covered Security is or was purchased or sold by
the Portfolio or was being considered for purchase or sale by the
Portfolio or the Adviser.
(c) Each Access Person shall promptly report any transaction which is, or might
appear to be, in violation of this Code. Such report shall contain the
information required in quarterly transaction reports filed pursuant to
Section 5(a)(ii).
(d) All reports prepared pursuant to this Section 5 shall be filed with the
person designated by the Adviser's compliance department to review these
materials.
(e) The Adviser's compliance department will identify all Access Persons who
are required to file reports pursuant to this Section 5 and will inform
them of their reporting obligation.
6. Recordkeeping Requirements
The Adviser will, on behalf of each Portfolio, maintain at its principal
place of business maintain records in the manner and extent set out in this
Section of this Code and will make available to the Securities and Exchange
Commission (SEC) at any time and from time to time for reasonable,
periodic, special or other examination:
(a) A copy of each code of ethics of the Adviser, distributor and the
Portfolios that is in effect, or at any time within the past five years was
in effect, must be maintained in an easily accessible place;
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(b) A record of any violation of this Code, and of any action taken as a result
of the violation, must be maintained in an easily accessible place for at
least five years after the end of the fiscal year in which the violation
occurs;
(c) A copy of each report made by an Access Person as required by Section 5(a)
of this Code, including any information provided in lieu of a quarterly
transaction report, must be maintained for at least five years after the
end of the fiscal year in which the report is made or the information is
provided, the first two years in an easily accessible place.
(d) A record of all persons, currently or within the past five years, who are
or were required to make reports as Access Persons or who are or were
responsible for reviewing these reports, must be maintained in an easily
accessible place.
(e) A copy of each report required by Section 7(b) of this Code must be
maintained for at least five years after the end of the fiscal year in
which it is made, the first two years in an easily accessible place.
(f) The Portfolio must maintain a record of any decision, and the reasons
supporting the decision, to approve the acquisition by Investment Personnel
of any Covered Security that is part of an Initial Public Offering or a
Limited Offering, for at least five years after the end of the fiscal year
in which the approval is granted.
7. Fiduciary Duties of the Portfolio's Board of Trustees
a. Each Portfolio's Trustees, including a majority of Disinterested Trustees,
must approve the code of ethics of the Portfolio, the Adviser and
distributor and any material change to these codes. The Board must base its
approval of a code and any material changes to the code on a determination
that the code contains provisions reasonably necessary to prevent Access
Persons from engaging in any conduct prohibited by Rule 17j-1(b) of the Act
as described in Section 1. Before approving the codes of the Adviser,
distributor and the Portfolios, each Portfolio's Board must receive
certification from the Adviser, distributor and the Portfolios that each
has adopted procedures reasonably necessary to prevent Access Persons from
violating its code of ethics. The Portfolio's Board must approve the codes
of the Adviser and the distributor before initially retaining the services
of the Adviser or distributor. The Portfolio's Board must approve a
material change to a code not later than six months after adoption of the
material change. The Adviser, distributor and the Portfolios must each use
reasonable diligence and institute procedures reasonably necessary to
prevent violations of its code of ethics.
b. No less frequently than annually, the Adviser, distributor, and the
Portfolios must furnish to the Portfolio's Board a written report that:
1. Describes any issues arising under the code of ethics or procedures since
the last report to the Board, including, but not limited to, information
about material violations of the code or procedures and sanctions imposed
in response to the material violations; and
2. Certifies that the Adviser, the distributor, and the Portfolios have
adopted procedures reasonably necessary to prevent Access Persons from
violating the code.
8. Sanctions
Upon discovering a violation of this Code, the Trustees of the Portfolio may
impose such sanctions as they deem appropriate, including, inter alia, a letter
of censure or suspension or termination of the employment of the violator.
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Annex A
The term "beneficial owner" shall mean any person who, directly or
indirectly, through any contract, arrangement, understanding, relationship or
otherwise, has or shares a direct or indirect pecuniary interest in the
securities, subject to the following:
(i) The term "pecuniary interest" in any class of securities shall mean the
opportunity, directly or indirectly, to profit or share in any profit
derived from a transaction in the subject securities.
(ii) The term "indirect pecuniary interest" in any class of securities shall
include, but not be limited to:
(A) Securities held by members of a person's immediate family sharing the same
household; provided, however, that the presumption of such beneficial
ownership may be rebutted;
(B) A general partner's proportionate interest in the portfolio securities held
by a general or limited partnership. The general partner's proportionate
interest, as evidenced by the partnership agreement in effect at the time
of the transaction and the partnership's most recent financial statements,
shall be the greater of: (1) the general partner's share of the
partnership's profits, including profits attributed to any limited
partnership interests held by the general partner and any other interests
in profits that arise from the purchase and sale of the partnership's
portfolio securities; or (2) the general partner's share of the partnership
capital account, including the share attributable to any limited
partnership interest held by the general partner;
(C) A performance-related fee, other than an asset-based fee, received by any
broker, dealer, bank, insurance company, investment company, investment
adviser, investment manager, trustee or person or entity performing a
similar function; provided, however, that no pecuniary interest shall be
present where (1) the performance-related fee, regardless of when payable,
is calculated based upon net capital gains and/or net capital appreciation
generated from the portfolio or from the fiduciary's overall performance
over a period of one year or more; and (2) securities of the issuer do not
account for more than 10 percent of the market value of the portfolio. A
right to a nonperformance-related fee alone shall not represent a pecuniary
interest in the securities;
(D) A person's right to dividends that is separated or separable from the
underlying securities. Otherwise, a right to dividends alone shall not
represent a pecuniary interest in the securities;
(E) A person's interest in the securities held by a trust, as follows:
(1) Trustees. If a trustee has a pecuniary interest, as provided above, in
any holding or transaction in the issuer's securities held by the
trust, such holding or transaction shall be attributed to the trustee
in the trustee's individual capacity, as well as on behalf of the
trust. With respect to performance fees and holdings of the trustee's
immediate family, trustees shall be deemed to have a pecuniary
interest in the trust holdings and transactions in the following
circumstances: (i) a performance fee is received that does not meet
the proviso of paragraph (ii)(C) above; or (ii)at least one
beneficiary of the trust is a member of the trustee's immediate
family. The pecuniary interest of the immediate family member(s) shall
be attributed to the trustee;
(2) Beneficiaries. A beneficiary shall have or share reporting obligations
with respect to transactions in the issuer's securities held by the
trust, if the beneficiary is a beneficial owner of the securities, as
follows:
(aa) If a beneficiary shares investment control with the trustee
with respect to a trust transaction, the transaction shall
be attributed to both the beneficiary and the trust;
(bb) If a beneficiary has investment control with respect to a
trust transaction without consultation with the trustee, the
transaction shall be attributed to the beneficiary only; and
(cc) In making a determination as to whether a beneficiary is the
beneficial owner of the securities, beneficiaries shall be
deemed to have a pecuniary interest in the issuer's
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securities held by the trust to the extent of their pro rata
interest in the trust where the trustee does not exercise
exclusive investment control.
(3) Settlors. If a settlor reserves the right to revoke the trust without
the consent of another person, the trust holdings and transactions
shall be attributed to the settlor instead of the trust; provided,
however, that if the settlor does not exercise or share investment
control over the issuer's securities held by the trust, the trust
holdings and transactions shall be attributed to the trust instead of
the settlor; and
(F) A person's right to acquire securities through the exercise or conversion
of any derivative security, whether or not presently exercisable.
(iii) A shareholder shall not be deemed to have a pecuniary
interest in the portfolio securities held by a corporation or similar
entity in which the person owns securities if the shareholder is not a
controlling shareholder of the entity and does not have or share
investment control over the entity's portfolio.
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CODE OF ETHICS
Schedule A
Portfolio Adoption Date
The Federal Money Market Portfolio 1/27/00
The Prime Money Market Portfolio 1/27/00
The Tax Exempt Money Market Portfolio 1/27/00
The Short Term Bond Portfolio 1/27/00
The U.S. Fixed Income Portfolio 1/27/00
The Tax Exempt Bond Portfolio 1/27/00
The U.S. Equity Portfolio 1/27/00
The U.S. Small Company Portfolio 1/27/00
The International Equity Portfolio 1/27/00
The Diversified Portfolio 1/27/00
The Emerging Markets Equity Portfolio 1/27/00
The New York Tax Exempt Bond Portfolio 1/27/00
The European Equity Portfolio 1/27/00
The Disciplined Equity Portfolio 1/27/00
The International Opportunities Portfolio 1/27/00
J.P. Morgan Tax Aware U.S. Equity Fund 1/27/00
J.P. Morgan Tax Aware Disciplined Equity Fund 1/27/00
J.P. Morgan California Bond Fund 1/27/00
The Emerging Markets Debt Portfolio 1/27/00
The U.S. Small Companies Portfolio 1/27/00
The Global Strategic Income Portfolio 1/27/00
The Treasury Money Market Portfolio 1/27/00
J.P. Morgan Global 50 Fund 1/27/00
J.P. Morgan U.S. Market Neutral Fund 1/27/00
J.P. Morgan U.S. Large Cap Growth Fund 1/27/00
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J.P. Morgan SmartIndex Fund 1/27/00
J.P. Morgan Tax Aware Enhanced Income Fund 1/27/00
J.P. Morgan Enhanced Income Fund 4/06/00
J.P. Morgan Global HealthTech Equity Fund 6/12/00
J.P. Morgan Global Technology, Media and Telecom. Fund 6/12/00
