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JPMorgan Funds
Notes to the Unaudited Financial Statements (continued)
As at 31 December 2007
Performance Fees Accruals
If the Share Class Return exceeds the Benchmark Return and the cumulative Share Class Return exceeds the High Water Mark Return (as set out in
Appendix V to the Prospectus), the Performance Fees accrual is increased by the Performance Fees Rate multiplied by the Excess Return multiplied by
the previous Valuation Day’s Adjusted net asset value for that Class. If the Share Class Return does not exceed the Benchmark Return, the
Performance Fees accrual is reduced (but not below zero) by the Performance Fees Rate multiplied by the negative Excess Return multiplied by the
previous Valuation Day’s Adjusted net asset value for that Class. Following a period of negative Excess Return whereby the Performance Fees accrual
has been reduced to zero, no new Performance Fees are accrued until such time as the cumulative Share Class Return exceeds the greater of the High
Water Mark Return and the cumulative Benchmark Return since the beginning of the Company accounting year. The Performance Fees accrued on
any Valuation Day are reflected in the Net Asset Value per Share on the basis of which subscriptions and redemptions may be accepted.
The Performance Fees are accrued daily and paid at the end of the financial year. Performance Fees are recorded separately in the Combined
Statement of Operations and Changes in Net Assets.
As of 31 December 2007, the Performance Fees rate and the benchmarks are as follows:
Sub-Fund Performance Benchmark
Fees Rate
JPMorgan Funds -
10% Russell Micro Cap Index (Total Return Net)
America Micro Cap Fund
JPMorgan Funds -
Morgan Stanley Capital International (MSCI) Emerging
10%
Emerging Markets Alpha Plus Fund
Markets (Total Return Net)
JPMorgan Funds -
10% HSBC Smaller Pan-European (Total Return Gross)
Europe Dynamic Small Cap Fund
JPMorgan Funds -
Morgan Stanley Capital International (MSCI) Europe (Total
10%
Europe 130/30 Fund
Return Net)
JPMorgan Funds -
Morgan Stanley Capital International (MSCI) Europe (Total
10%
Europe Focus Fund
Return Net)
JPMorgan Funds -
10% HSBC Smaller Pan-European Index (Total Return Gross)
Europe Micro Cap Fund
JPMorgan Funds -
Morgan Stanley Capital International (MSCI) Europe (Total
10%
Europe Select 130/30 Fund
Return Net)
JPMorgan Funds -
Morgan Stanley Capital International (MSCI) All Countries Far
10%
JF Asia Alpha Plus Fund
East ex-Japan Index (Total Return Net)
JPMorgan Funds -
10% Tokyo Stock Price Index (TOPIX) (Total Return Net)
JF Japan Alpha Plus Fund
JPMorgan Funds -
10% Tokyo Stock Price Index (TOPIX) (Total Return Net)
JF Tokyo Alpha Plus Fund
JPMorgan Funds -
Standard & Poor’s (S&P) rating Group 500 Index (Total
10%
US 130/30 Fund
Return Net)
JPMorgan Funds -
US Select 130/30 Fund
10%
Standard & Poor’s (S&P) rating Group 500 Index (Total
Return Net)
7. Transactions with Connected Parties
All transactions with connected parties were carried out on an arm’s length basis.
JPMorgan Chase & Co. and its affiliates are counterparties for all securities lending activity and for certain forward foreign exchange contracts
and financial futures contracts. The Management Company, Registrar, Global Distributor, Transfer and Domiciliary Agent, Advisory
Company, Investment Managers, Custodian, Corporate, Administrative and Paying Agent and other related Agents of the SICAV are
considered as connected parties.
8. Information for Swiss Registered Shareholders
J.P. Morgan (Suisse) S.A. was authorised by the Federal Banking Commission as Swiss representative of the SICAV and acts also as paying
agent. The prospectus, the simplified prospectus, the articles, the annual and semi-annual reports of the SICAV, as well as the list of the
purchases and sales which the SICAV has undertaken during the financial period may be obtained, on simple request and free of charge, at the
head office of the Swiss Representative, J.P. Morgan (Suisse) S.A., 8 rue de la Confédération, P.O. Box 5160, CH-1211 Geneva 11, Switzerland.
Payments/compensations (trailer fees) can be paid out from the management fee for the distribution/marketing of the investment fund to
distributors. Reimbursements/rebates can be granted out of the management fee to institutional investors who hold the fund units for the
economic benefit of third parties.
9. Information for German Registered Shareholders
A list, specifying for each investment within each Sub-Fund the total purchases and sales which occurred during the period under review, may
be obtained free of charge upon request at the registered office of the SICAV and at the office of the German paying and information agent,
J.P. Morgan AG, Junghofstraße 14, D-60311 Frankfurt am Main. Additional information on investments within each Sub-Fund’s portfolio is
available to shareholders at the registered office of the SICAV and at the office of the German paying and information agent.
10. Securities Lending
The SICAV may lend portions of its securities portfolio to third parties. Such lending may only be effected via recognised clearing houses, or
through the intermediary of prime financial institutions that specialise in such activities and in the modus specified by them. Such transactions
may not be entered into for longer than 30 days. If the loan of securities exceeds 50% of the securities portfolio of the Sub-Fund concerned, it
may only be effected on condition that it is possible to terminate the loan contract with immediate effect. The Directors will ensure that
revenues arising from securities lending arrangements and the division thereof are in accordance with usual market practice and that the
Sub-Fund retains an appropriate share thereof. During the period, 65% of any incremental income earned from securities lending was accrued
to the applicable Sub-Fund, with the remaining income payable to the relevant parties which arrange the transaction. The income earned from
the securities lending program is detailed in the Combined Statement of Operations and Changes in Net Assets.
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