3. Fees
and Other Transactions with Affiliates
A. Management
Fee—
JPMIM manages the investments of each Fund pursuant to a Management Agreement.
For such services, JPMIM is paid a fee which is accrued
daily and paid no more frequently than monthly based on each Fund's respective
average daily net assets at the following rate:
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Sustainable
Consumption ETF |
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Sustainable
Infrastructure ETF |
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Under each Management
Agreement, JPMIM is responsible for substantially all expenses of each Fund,
(including expenses of the Trust relating to each Fund), except
for the management fees, payments under the Funds' 12b-1 plan (if any), interest
expenses, dividend and interest expenses related to short
sales, taxes, acquired fund fees and expenses (other than fees for funds advised
by the Adviser and/or its affiliates), costs of holding shareholder meetings,
and litigation and potential litigation and other extraordinary expenses not
incurred in the ordinary course of each Fund’s business.
Additionally, each Fund is responsible for its non-operating expenses, including
brokerage commissions and fees and expenses associated with each Fund’s
securities lending program, if applicable. For the avoidance of doubt, the
Adviser’s payment of such expenses may be accomplished through a Fund’s
payment of such expenses and a corresponding reduction in the fee payable to the
Adviser, provided, however, that if the amount of expenses paid by a
Fund exceeds the fee payable to the Adviser, the Adviser will reimburse that
Fund for such amount.
B. Administration
Fee —
JPMIM provides administration services to the Funds. Pursuant to each Management
Agreement, JPMIM is compensated as described in Note
3.A.
JPMorgan Chase Bank,
N.A. (“JPMCB”), a wholly-owned subsidiary of JPMorgan, serves as the Funds'
sub-administrator (the “Sub-administrator”). For its services as
Sub-administrator, JPMCB receives a portion of the management fees payable to
JPMIM.
C. Custodian,
Accounting and Transfer Agent Fees—
JPMCB provides custody, accounting and transfer agency services to the Funds.
For performing these
services, JPMIM pays JPMCB transaction and asset-based fees that vary according
to the number of transactions and positions, plus out-of-pocket
expenses.
Additionally,
Authorized Participants generally pay transaction fees associated with the
creation and redemption of Fund shares. These fees are paid to JPMIM to offset
certain custodian charges that are covered by each Management
Agreement.
Interest income
earned on cash balances at the custodian, if any, is included in Interest income
from affiliates on the Statements of Operations.
Interest expense paid
to the custodian related to cash overdrafts, if any, is included in Interest
expense to affiliates on the Statements of Operations.
D. Distribution
Services —
The Distributor or its agent distributes Creation Units for each Fund on an
agency basis. The Distributor does not maintain a secondary
market in shares of each Fund. JPMDS receives no fees for their
distribution services under the distribution agreement with the Trust (the
“Distribution Agreement”). Although the Trust does not pay any fees under the
Distribution Agreement, JPMIM pays JPMDS for certain distribution related
services.
E. Waivers
and Reimbursements —
The Funds may invest in one or more money market funds advised by the Adviser
(affiliated money market funds). The fees for
the affiliated money market funds, except for investments of securities lending
cash collateral, are covered under each Management Agreement as
described in Note 3.A.
F. Other —
Certain officers of the Trust are affiliated with the Adviser, the Administrator
and JPMDS. Such officers receive no compensation from the Funds for serving
in their respective roles.
The Board designated
and appointed a Chief Compliance Officer to the Funds pursuant to Rule 38a-1
under the 1940 Act. The fees associated with the office of the
Chief Compliance Officer are paid for by JPMIM as described in Note
3.A.
The Securities and
Exchange Commission (“SEC”) has granted an exemptive order permitting the Funds
to engage in principal transactions with J.P. Morgan Securities
LLC, an affiliated broker, involving taxable money market instruments, subject
to certain conditions.
4. Investment
Transactions
During the
year ended October 31, 2022, purchases and sales of investments
(excluding short-term investments) were as follows:
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Purchases
(excluding
U.S.
Government) |
Sales
(excluding
U.S.
Government) |
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Sustainable
Consumption ETF |
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Sustainable
Infrastructure ETF |
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