-----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, Vo0oZGAXIljZr4udyhwGJEPp5vPwif6Te+OZpKzhV2OwnKVi2VRqTM8I/kmHWe4o 0w2xyxS1MuZxaX5bGJJ+LQ== 0000950109-02-000085.txt : 20020413 0000950109-02-000085.hdr.sgml : 20020413 ACCESSION NUMBER: 0000950109-02-000085 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20011031 FILED AS OF DATE: 20020104 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NORTH AMERICAN FUNDS CENTRAL INDEX KEY: 0000848103 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: MA FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-05797 FILM NUMBER: 2502025 BUSINESS ADDRESS: STREET 1: NORTH AMERICAN FUNDS STREET 2: 286 CONGRESS ST CITY: BOSTON STATE: MA ZIP: 02210 BUSINESS PHONE: 6172104520 MAIL ADDRESS: STREET 1: NORTH AMERICAN FUNDS STREET 2: 286 CONGRESS ST CITY: BOSTON STATE: MA ZIP: 02210 FORMER COMPANY: FORMER CONFORMED NAME: NORTH AMERICAN SECURITY TRUST DATE OF NAME CHANGE: 19920703 N-30D 1 dn30d.txt NORTH AMERICAN FUNDS ANNUAL REPORT 10/31/2001 ANNUAL REPORT NORTH AMERICAN FUNDS A specialized family of mutual funds managed by experts with your dreams in mind. OCTOBER 31, 2001 AUDITED FINANCIAL STATEMENTS [LOGO] AMERICAN GENERAL FINANCIAL GROUP NORTH AMERICAN FUNDS INDEX TO ANNUAL REPORT - --------------------------------------------------------------------------------
Page ---- Fund performance and Portfolio Manager's Commentary........................ i Report of Independent Accountants.......................................... 1 Statements of Assets and Liabilities....................................... 2 Statements of Operations................................................... 12 Statements of Changes in Net Assets........................................ 17 Financial Highlights....................................................... 24 Portfolio of Investments Growth & Income Fund..................................................... 61 Large Cap Growth Fund.................................................... 62 Mid Cap Growth Fund...................................................... 64 Mid Cap Value Fund....................................................... 66 Science & Technology Fund................................................ 67 Small Cap Growth Fund.................................................... 68 Stock Index Fund......................................................... 70 Global Equity Fund....................................................... 76 International Equity Fund................................................ 77 International Small Cap Fund............................................. 84 Balanced Fund............................................................ 86 Core Bond Fund........................................................... 88 High Yield Bond Fund..................................................... 92 Municipal Bond Fund...................................................... 96 Strategic Income Fund.................................................... 97 U.S. Government Securities Fund.......................................... 102 Money Market Fund........................................................ 103 Municipal Money Market Fund.............................................. 104 Aggressive Growth LifeStyle Fund......................................... 105 Moderate Growth LifeStyle Fund........................................... 105 Conservative Growth LifeStyle Fund....................................... 106 Notes to Financial Statements.............................................. 107
This page intentionally left blank. NORTH AMERICAN FUNDS FUND PERFORMANCE AND PORTFOLIO MANAGER'S COMMENTARY - ------------------------------------------------------------------------------- Fund Performance In the following pages we have set forth information regarding the performance of the Science and Technology Fund, Small Cap Growth Fund, Stock Index Fund, Core Bond Fund, High Yield Bond Fund, Strategic Income Fund, and each of the LifeStyle Funds. There are several ways to evaluate a Fund's historical performance. One can look at the total percentage change in value, the average annual percentage change, or the growth of a hypothetical $10,000 investment. With respect to all the performance information presented, it is important to understand that past performance does not guarantee future results. Return and principal fluctuate, and shares, when redeemed, may be worth more or less than their original cost. Performance Tables The Performance Tables show two types of total return information: cumulative and average annual total returns. A cumulative total return is an expression of a Fund's total change in share value in percentage terms over ten years (or since the Fund's inception if less than ten years). An average annual total return takes the Fund's cumulative total return over a set period of time - one, five and ten years (or since the Fund's inception if less than ten years) and shows what would have happened if the Fund had performed at a constant rate each year. For all share classes, the tables show cumulative and average annual total returns both net of the possible maximum applicable front-end or back-end sales charge, as well as without giving effect to such possible maximum charges (at net asset value "NAV"). Graph - Change in Value of $10,000 Investment and Comparative Indices The performance graph for each Fund shows the change in value of a $10,000 investment over the life of the Fund's Class A shares. Each Fund's performance is compared to the performance of one or more broad-based securities indices as a "benchmark". Fund results (which include the reinvestment of dividends and capital gains distributions as well as the deduction of ongoing management and distribution fees and operating expenses) reflect the deduction of the current maximum sales charge applicable to each Fund's class A shares. Please note that effective April 1, 1994, Class B and Class C shares were offered. Performance of these share classes will differ. Historical performance prior to April 1, 1994 is that of the Fund before it adopted the current multi-class structure. These returns do not reflect the effect of any taxes a shareholder might incur on distributions received, or on the redemption of shares. Benchmarks used for comparison are unmanaged and do not reflect any fees or expenses. Portfolio Manager's Commentary Finally, we have provided a commentary by each Fund's portfolio manager regarding each Fund's performance during the fiscal year ended October 31, 2001. All performance results referenced in the commentary are Class A share returns. i Science & Technology Fund Investment Seeks to provide long-term growth of capital by investing Objective: at least 65% of the Fund's total assets in the common stocks and equity-related securities of companies that are expected to benefit from scientific breakthroughs and advancements in technology. Subadvisor: T. Rowe Price Associates, Inc. ("TRowe") Portfolio Chip Morris Manager: Inception Date: March 1, 2000/4/ Change in Value of $10,000 Investment and Comparative Indices Science & Technology Fund [CHART] 5.75% Sales S&P 500 NAV Charge Index 3/1/2000 $10,000 $9,425 $10,000 3/31/2000 9,960.01 9,387.3 10,978.3 4/28/2000 8,940.01 8,425.95 10,647.96 5/31/2000 7,850.01 7,398.63 10,429.47 6/30/2000 8,740.01 8,237.45 10,686.55 7/31/2000 8,370.01 7,888.73 10,519.63 8/31/2000 9,920.01 9,349.6 11,173 9/29/2000 8,750.01 8,246.88 10,583.18 10/31/2000 8,080.01 7,615.4 10,538.41 11/30/2000 5,940.01 5,598.45 9,707.57 12/29/2000 6,030.01 5,683.28 9,755.04 1/31/2001 6,750.01 6,361.88 10,101.14 2/28/2001 4,660.01 4,392.05 9,180.12 3/30/2001 3,820.01 3,600.35 8,598.56 4/30/2001 4,990.01 4,703.08 9,266.75 5/31/2001 4,700.01 4,429.75 9,328.84 6/29/2001 4,480.01 4,222.4 9,101.78 7/31/2001 4,180.01 3,939.65 9,012.22 8/31/2001 3,520.01 3,317.60 8,448.05 9/28/2001 2,730.01 2,573.03 7,765.87 10/31/2001 3,180.01 2,997.15 7,913.97 Performance Table
Average Annual Cumulative Total Return Total Return ----------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2001/4/ ------- --------- ------------ S&P 500 Index/1/ -24.90% -13.27% -20.86% Science & Technology Fund Class A (NAV) -60.64% -49.68% -68.20% Science & Technology Fund Class A (net of 5.75% sales charge) -62.89% -51.43% -70.03% Science & Technology Fund Class B (NAV) -60.90% -50.06% -68.60% Science & Technology Fund Class B (net of CDSC)/2/ -62.85% -51.57% -70.17% Science & Technology Fund Class C (NAV)/5/ -60.87% -54.23% -63.92% Science & Technology Fund Class C (net of CDSC)/3/,/5/ -61.26% -54.23% -63.92% Science & Technology Fund Institutional Class I -60.52% -49.58% -68.10%
ii Portfolio Manager's Commentary: For the one year-period ending October 31, 2001, the NAF - Science & Technology Fund Class A under-performed its benchmark, declining - 60.64% vs. a return of - 24.90% for the S&P 500 Index. In one of the worst recorded periods for technology shares, fund manager Chip Morris focused on a few major secular growth themes: building the internet infrastructure, broadband networking (data and optical), globalization of digital wireless, and the non-PC based semiconductor cycle. A significant position in semiconductor equipment maker, KLA-Tencor, proved to be the number one contributor to Fund performance over the trailing one-year period. Amid the general decline in technology stocks, the company's dominant footprint in yield monitoring and process control systems for the worldwide semiconductor industry awarded this company a higher security valuation. Software maker, Electronic Arts also provided a meaningful contribution as three new videogame platforms renewed consumer interest in home entertainment products. Finally, a position in WorldCom, a leading provider of global communications services in the United States lifted the Fund's returns as investors praised the company's renewed focus on improving the company's balance sheet. The Fund's emphasis on high quality, market leading technology issues in the rapidly growing networking and internet related software industries negatively impacted period returns as the collapse of the Internet bubble saw investors focus on slower growing, more conservative companies such as IBM. Holdings in market leaders such as Cisco Systems, Corning Inc, and Nokia hurt the Fund's returns as the economic slowdown led to much higher inventory levels, and lowered earnings expectations. The prospects for the technology sector may depend on a confluence of factors; a recovery in corporate profits and subsequent increased allocation in enterprise technology expenditures, and modest valuations for technology stocks. Fund manager Chip Morris believes that a potential recovery in 2002 will help bring the sector back to more normal positive absolute returns, but cautions that there may be periods where investors extend valuations above fundamentals. The Fund is positioned defensively into established companies that have controlled their expenses during this recent economic slowdown. These companies may experience increased earnings leverage when revenues improve during the recovery. Chip feels that PCs, handsets, and Wireline communications equipment products have saturated the market, and prefers positions in data related companies, where forecasted earnings growth appears more tangible. - ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Performance information shown for periods prior to July 7, 2000, is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July, 7 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. /5/Inception date is July 12, 2000. iii Small Cap Growth Fund Investment Seeks to provide maximum capital appreciation by Objective: investing primarily in a portfolio of equity securities of domestic companies. Under normal conditions, the Fund will be mainly invested in common stocks or warrants of emerging growth companies that represent attractive opportunities for maximum capital appreciation. Subadvisor: Credit Suisse Asset Management/Warburg Pincus ("CSAM") Portfolio Elizabeth B. Dater, Stephen P. Lurito Managers: Inception Date: January 6, 1998 Change in Value of $10,000 Investment and Comparative Indices Small Cap Growth Fund [CHART] 5.75% Sales Russell 2000 NAV Charge Growth Index 01/1998 $10,000 $ 9,425 $10,000 03/1998 11,160.01 10,518.3 11,286.38 06/1998 10,940.01 10,310.95 10,638.18 09/1998 8,470.01 7,982.98 8,259.5 12/1998 10,090.01 9,509.83 10,211.85 03/1999 10,090.01 9,509.83 10,040.35 06/1999 11,630.01 10,961.28 11,520.83 09/1999 11,970.01 11,281.73 10,954.29 12/1999 17,468.87 16,464.41 14,612.4 03/2000 21,479.28 20,244.22 15,968.8 06/2000 20,052.02 18,899.02 14,791.57 09/2000 19,649.97 18,520.1 14,203.93 12/2000 17,264.68 16,271.96 11,334.9 03/01/2001 12,905.88 12,163.79 9,611.6 06/01/2001 14,824.18 13,971.79 11,339.2 09/01/2001 11,051.53 10,416.06 8,155.1 10/01/2001 12,224 11,520.95 8,939.65 Performance Table
Average Annual Cumulative Total Return Total Return ----------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2001 ------- --------- ------------ Russell 2000 Growth Index -31.50% -2.89% -10.60% Small Cap Growth Fund Class A (NAV) -33.56% 5.40% 22.24% Small Cap Growth Fund Class A (net of 5.75% sales charge) -37.37% 3.78% 15.21% Small Cap Growth Fund Class B (NAV) -33.84% 4.57% 18.60% Small Cap Growth Fund Class B (net of CDSC)/1/ -37.15% 3.87% 15.60% Small Cap Growth Fund Class C (NAV) -33.80% 4.57% 18.61% Small Cap Growth Fund Class C (net of CDSC)/2/ -34.46% 4.57% 18.61% Small Cap Growth Fund Institutional Class I/3/ -33.33% -30.75% -38.19%
iv Portfolio Managers' Commentary: The Small Cap Growth Fund Class A share performance for the year-ended October 31, 2001 was - 33.56% slightly underperforming the Russell 2000 Growth Index return of - 31.50%. The period was a very poor one for the U.S. stock market, buffeted by worries over the economy. In broad terms, assets classes that are typically highly sensitive to risk, such as aggressive-growth stocks and technology stocks (from across the market-capitalization spectrum) suffered the most. The Fund's returns for the period reflected the harsh conditions for the stocks it targets. The Fund's technology holdings generally had the largest declines. Factors that helped the Fund included its overweighting in health care over much of the period, as these stocks had relatively good performance. In terms of sector emphasis, one noteworthy move we made in the period was to raise the Fund's weighting in the health-care area. We continued to emphasize the sector's services names (which accounted for roughly two-thirds of our health-care exposure), although, we maintained positions in certain emerging- drug and biotechnology companies that we deemed compelling. We maintained an approximately neutral position in the technology area. The sector's overall earnings picture remained murky, in our view, and hence we remained reluctant to take a more aggressive position. On the other hand, we believed that a significant underweighting would be inappropriate, given the Fund's goals and based on the number of technology companies that we viewed as good quality businesses with healthy long-term growth prospects. Indeed, we have used recent market turbulence as an opportunity to add to a number of our technology positions, purchasing shares we judged to be good values, with stocks in some cases trading below book value. We continued to favor software companies in the computer sector, and semiconductor-equipment companies in the electronics sector. Elsewhere, the Fund's exposure to telecommunications/media companies was relatively light, reflecting our general concerns over risk and valuation levels, particularly among telecom- equipment manufacturers. However, we continued to see what we viewed as attractive opportunities in communications-related companies. The Fund's largest position at the end of the period, for example, was Polycom (2.9% of the Fund), a provider of video and voice conferencing equipment. We believe this industry will continue to expand, especially in light of recent events. The rest of the Fund was invested primarily in the consumer non-durable and capital goods areas. Looking ahead, the markets may be hampered by economic worries for at least a few months; the economy has now been declared to be in recession. We believe, however, that there are grounds for optimism that the economy can steadily gain traction as 2002 progresses, barring any disruptions related to the nation's commitment to the war on terrorism. The Fed's recent and aggressive monetary easing augurs well for the economy, in our view. The government also has various fiscal-policy tools (e.g., more tax cuts) that it appears quite willing to employ. Energy costs have also declined of late, and if the trend continues, or if costs at least remain stable, consumers will benefit from this additional "tax" relief. We believe that small-cap growth stocks, which tend to outperform broader averages coming out of periods of economic weakness, have good long-term prospects, with many names offering the potential for significant advances over the next two or three years and beyond. The timing of any extended rally is obviously unknown, and we believe that in any event individual company selection will prove critical. Amid what we expect to be continued market volatility over the next few months, we will remain focused on identifying stocks we believe have the brightest long-term growth potential. - ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Inception date is 7/10/2000. v Stock Index Fund Investment Seeks to provide investment results that are similar to Objective: the total return of the S&P 500 Index. The Index is composed of 500 common stocks chosen by Standard & Poor's, and approximates the general distribution of industries in the U.S. economy and captures the price performance of a large cross-section of the publicly traded stock market. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Magali Azema-Barac Managers: Inception Date: November 2, 1998/4/ Change in Value of $10,000 Investment and Comparative Indices Stock Index Fund [CHART] 5.75% Sales S&P 500 NAV Charge Index 11/1998 $10,000 $9,425 $10,000 12/1998 11,115.81 10,476.65 11,216.6 03/1999 11,639.07 10,969.82 11,775.39 06/1999 12,495.45 11,776.96 12,605.26 09/1999 11,698.63 11,025.96 11,819.06 12/1999 13,381.84 12,612.39 13,577.36 03/2000 13,666.3 12,880.49 13,888.79 06/2000 13,256.05 12,493.83 13,519.7 09/2000 13,097.88 12,344.75 13,388.92 12/2000 12,053.91 11,360.81 12,341.22 03/2001 10,615.72 10,005.32 10,878.15 06/2001 11,215.83 10,570.92 11,514.78 09/2001 9,550.01 9,000.89 9,824.7 10/2001 9,715.56 9,156.91 10,012.06 Performance Table
Average Annual Cumulative Total Return Total Return ----------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2001/1/ ------- --------- ------------ S&P 500 Index -24.90% 0.04% 0.12% Stock Index Fund Class A (NAV) -25.53% -0.96% -2.84% Stock Index Fund Class A (net of 5.75% sales charge) -29.83% -2.90% -8.43% Stock Index Fund Class B (NAV) -25.97% -1.86% -5.46% Stock Index Fund Class B (net of CDSC)/1/ -29.66% -3.19% -9.24% Stock Index Fund Class C (NAV)/3/ -25.92 -23.96% -29.78% Stock Index Fund Class C (net of CDSC)/2/,/3/ -26.66 -23.96% -29.78%
vi Portfolio Managers' Commentary: The Stock Index Fund Class A performance for the year-ended October 31, 2001 was - 25.53% as compared to the S&P 500 Index return of - 24.90%. The year ended October 31, 2001, was a depressing year with the Science and Technology sector posting a whopping - 58.40% after having been the best performing sector in the equity market during the previous year. The mid cap and the small cap segments of the market resisted the downturn somewhat better, posting returns of- 12.4 % and 12.7%, respectively. The fiscal year ending October 31, 2001 could be qualified as a Value year, as the Value segment of the market returned - 11.8% versus - 39.9% for the Growth segment of the market. - ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Inception date is 7/17/2000. /4/Performance information shown for periods prior to July, 7 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July, 7 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. vii Core Bond Fund Investment Seeks a high level of current income consistent with the Objective: maintenance of principal and liquidity. To achieve this objective, AGIM invests at least 65% of the Fund's total assets in medium to high quality fixed-income securities, or in securities issued or guaranteed by the U.S. Government, mortgage-backed, or asset-backed securities. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio A Team led by Albert Gutierrez/5/ Manager: Inception Date: May 1, 1991 Change in Value of $10,000 Investment and Comparative Indices Small Cap Growth Fund [CHART] 50%/50% 4.75% Sales LB Aggregate Composite NAV Charge Bond Index Index 10/1991 $10,000 $9,525 $10,000 $10,000 11/1991 10,080.62 9,601.79 10,092 10,099.25 12/1991 10,446.73 9,950.51 10,391.73 10,436.29 01/1992 10,251.25 9,764.32 10,250.4 10,290.01 02/1992 10,339 9,847.89 10,317.03 10,359.48 03/1992 10,276.58 9,788.44 10,259.26 10,307.07 04/1992 10,320.83 9,830.59 10,333.12 10,365.2 05/1992 10,558.3 10,056.78 10,528.42 10,576.74 06/1992 10,736.35 10,226.37 10,673.71 10,735.34 07/1992 10,997.37 10,475 10,891.46 11,013.95 08/1992 11,113.07 10,585.2 11,001.46 11,107.92 09/1992 11,271.57 10,736.17 11,132.38 11,253.77 10/1992 11,100.04 10,572.78 10,984.32 11,072.42 11/1992 11,127.2 10,598.66 10,986.51 11,071.99 12/1992 11,311.04 10,773.76 11,161.2 11,267.49 01/1993 11,549.28 11,000.69 11,375.49 11,518.86 02/1993 11,756.22 11,197.8 11,574.56 11,766.7 03/1993 11,822.95 11,261.36 11,623.18 11,806.72 04/1993 11,898.61 11,333.42 11,704.54 11,897.63 05/1993 11,909.46 11,343.76 11,719.76 11,898.39 06/1993 12,139.84 11,563.2 11,931.88 12,175.18 07/1993 12,173.16 11,594.94 11,999.9 12,256.24 08/1993 12,416.75 11,826.96 12,209.89 12,545.72 09/1993 12,472.38 11,879.95 12,242.86 12,584.47 10/1993 12,505.65 11,911.63 12,288.16 12,639.96 11/1993 12,304.1 11,719.66 12,183.71 12,492.58 12/1993 12,361.97 11,774.78 12,249.5 12,553.98 01/1994 12,533.19 11,937.86 12,414.87 12,762.32 02/1994 12,200.53 11,621 12,198.85 12,476.16 03/1994 11,802.49 11,241.87 11,897.54 12,143.39 04/1994 11,681.11 11,126.26 11,802.36 12,037 05/1994 11,675.31 11,120.73 11,801.18 12,006.72 06/1994 11,634.49 11,081.85 11,775.22 11,977.89 07/1994 11,851.24 11,288.31 12,009.54 12,240.07 08/1994 11,857.13 11,293.91 12,023.95 12,248.11 09/1994 11,662.07 11,108.12 11,847.2 12,047.44 10/1994 11,620.5 11,068.53 11,836.54 12,029.24 11/1994 11,591.87 11,041.25 11,810.5 12,008.81 12/1994 11,690.62 11,135.31 11,891.99 12,095.43 01/1995 11,891.1 11,326.27 12,127.45 12,336.34 02/1995 12,177.75 11,599.3 12,416.09 12,647.25 03/1995 12,246.15 11,664.45 12,491.83 12,739.16 04/1995 12,425.48 11,835.27 12,666.71 12,930.7 05/1995 12,926.94 12,312.91 13,156.91 13,496.69 06/1995 13,008.9 12,390.98 13,252.96 13,609.6 07/1995 12,966.45 12,350.55 13,223.8 13,554.36 08/1995 13,112.06 12,489.24 13,383.81 13,743.49 09/1995 13,245.83 12,616.65 13,513.63 13,890.95 10/1995 13,469.13 12,829.35 13,689.31 14,086.39 11/1995 13,680.86 13,031.02 13,894.65 14,331.44 12/1995 13,887.08 13,227.45 14,089.17 14,551.9 01/1996 13,946.4 13,283.94 14,182.16 14,643.66 02/1996 13,669.02 13,019.74 13,935.39 14,319.3 03/1996 13,546.54 12,903.08 13,837.85 14,198.97 04/1996 13,423.39 12,785.77 13,760.35 14,094.24 05/1996 13,378.6 12,743.11 13,732.83 14,069.55 06/1996 13,545.5 12,902.09 13,916.85 14,264.05 07/1996 13,566.81 12,922.39 13,954.43 14,295.32 08/1996 13,548.06 12,904.53 13,930.71 14,257.26 09/1996 13,798.55 13,143.12 14,173.1 14,527.6 10/1996 14,077.5 13,408.82 14,487.74 14,886.83 11/1996 14,344.35 13,662.99 14,735.48 15,176.58 12/1996 14,188.31 13,514.37 14,598.44 14,993.54 01/1997 14,210.33 13,535.34 14,643.7 15,012.35 02/1997 14,260.14 13,582.78 14,680.31 15,055.06 03/1997 14,059.8 13,391.96 14,517.36 14,856.58 04/1997 14,292.04 13,613.16 14,735.12 15,076.64 05/1997 14,413.01 13,728.39 14,875.1 15,227.29 06/1997 14,605.37 13,911.62 15,052.11 15,421.42 07/1997 15,068.99 14,353.21 15,458.52 15,924.77 08/1997 14,877.41 14,170.73 15,327.12 15,762.62 09/1997 15,116.03 14,398.01 15,553.96 15,982.87 10/1997 15,283.66 14,557.69 15,779.5 16,221.26 11/1997 15,350.48 14,621.33 15,852.08 16,308.19 12/1997 15,505.29 14,768.79 16,012.19 16,480.27 01/1998 15,763.72 15,014.94 16,217.15 16,701.04 02/1998 15,757.81 15,009.32 16,204.17 16,676.65 03/1998 15,796.39 15,046.06 16,259.27 16,731.11 04/1998 15,850.09 15,097.21 16,343.81 16,821.98 05/1998 16,024.04 15,262.89 16,499.08 16,998.74 06/1998 16,138.6 15,372.02 16,639.32 17,157.3 07/1998 16,147.69 15,380.68 16,674.26 17,161.74 08/1998 16,187.3 15,418.4 16,946.06 17,419.17 09/1998 16,625.29 15,835.59 17,342.59 17,937.57 10/1998 16,449.8 15,668.44 17,250.68 17,766.27 11/1998 16,660.26 15,868.9 17,349.01 17,939.05 12/1998 16,685.15 15,892.6 17,401.05 17,984.97 01/1999 16,788.36 15,990.91 17,524.6 18,127.2 02/1999 16,389.08 15,610.6 17,217.92 17,696.71 03/1999 16,525 15,740.06 17,312.62 17,794.91 04/1999 16,582.2 15,794.55 17,368.02 17,841.34 05/1999 16,368.14 15,590.65 17,215.18 17,641.97 06/1999 16,281.4 15,508.03 17,160.09 17,577.61 07/1999 16,210.33 15,440.34 17,088.02 17,515.09 08/1999 16,138.86 15,372.26 17,079.48 17,493.52 09/1999 16,263 15,490.51 17,277.6 17,660.32 10/1999 16,272.86 15,499.9 17,341.52 17,715.78 11/1999 16,299.29 15,525.08 17,339.79 17,713.74 12/1999 16,259.42 15,487.09 17,256.56 17,609.55 01/2000 16,236.02 15,464.81 17,199.61 17,589.76 02/2000 16,414.18 15,634.51 17,407.73 17,795.25 03/2000 16,610.27 15,821.28 17,637.51 18,025.44 04/2000 16,399.46 15,620.48 17,586.36 17,919.78 05/2000 16,307.11 15,532.52 17,577.57 17,891.32 06/2000 16,644.26 15,853.66 17,943.18 18,276.1 07/2000 16,723.85 15,929.47 18,106.46 18,475.73 08/2000 16,908.32 16,105.17 18,369.01 18,727.49 09/2000 17,054.09 16,244.02 18,484.73 18,805.7 10/2000 16,980.17 16,173.61 18,606.73 18,896.66 11/2000 17,239.21 16,420.35 18,911.88 19,205.62 12/2000 17,550.71 16,717.05 19,263.64 19,583.01 01/2001 17,809.56 16,963.61 19,577.64 19,950.19 02/2001 17,979.94 17,125.9 19,747.97 20,150.69 03/2001 18,079.03 17,220.28 19,846.71 20,248.42 04/2001 17,961.4 17,108.23 19,763.35 20,108.71 05/2001 18,093.2 17,233.77 19,881.93 20,234.39 06/2001 18,170.8 17,307.68 19,957.48 20,332.53 07/2001 18,557.31 17,675.84 20,404.53 20,841.86 08/2001 18,724.48 17,835.07 20,639.18 21,110.72 09/2001 18,744.44 17,854.08 20,878.6 21,278.55 10/2001 19,162.01 18,251.82 21,314.96 21,816.89 Performance Table
Cumulative Average Annual Total Return Total Return --------------------------------------- -------------------- 1 5 10 Since Since Since Since Periods Ending October Year Years Years Inception 3/13/00/5/ Inception 3/13/00/5/ 31, 2001 ------ ----- ----- --------- ---------- --------- ---------- Lehman Brothers Aggregate Bond Index/1/ 14.56% 8.03% 7.86% 8.21% 13.03% 128.97% 22.30% 50%/50% Composite/1/,/2/ 15.45% 7.94% 8.11% 8.43% 12.95% 133.97% 22.60% Core Bond Fund Class A (NAV) 12.85% 6.36% 6.72% 7.10% 9.85% 105.44% 16.60% Core Bond Fund Class A (net of 4.75% sales charge) 7.48% 5.33% 6.20% 6.60% 6.63% 95.68% 11.06% Core Bond Fund Class B (NAV)/7/ 11.93% 5.69% N/A 5.94% 8.97% 54.91% 15.08% Core Bond Fund Class B (net of CDSC)/3/,/7/ 6.93% 5.37% N/A 5.94% 6.05% 54.91% 10.08% Core Bond Fund Class C (NAV)/7/ 11.93% 5.69% N/A 5.94% 8.97% 54.91% 15.08% Core Bond Fund Class C (net of CDSC)/4/,/7/ 10.93% 5.69% N/A 5.94% 8.97% 54.91% 15.08% Core Bond Fund Institutional Class I/6/ 13.01% N/A N/A 11.25% N/A 14.99% N/A Core Bond Fund Institutional Class II/6/ 13.37% N/A N/A 11.36% N/A 15.13% N/A
viii Portfolio Manager's Commentary: The Core Bond Fund Class A returned 12.85% for the year ended October 31, 2001, which was slightly lower than the Lehman Brothers Aggregate Bond Index return of 14.56%. The fund continued to be overweighted in corporate and mortgage-backed securities versus the Lehman Aggregate Index. Over the last 12 months, corporates have marginally outperformed governments, while mortgages have lagged. The corporate market suffered some volatility over the last year as the final two months of 2000 saw significant weakness, followed by a strong rally in the first half of 2001. After September 11, corporates underperformed as investors avoided riskier names and a "flight to quality" ensued. Mortgage- backed securities lagged their corporate and government counterparts during the year as the impressive rally in U.S. Treasuries brought prepayment risk to the forefront. The U.S. economy is currently facing a recession the length and depth of which are still not totally clear. The Federal Reserve, with its unprecedented rate cuts coupled with likely additional fiscal stimulus, should serve to aid the recovery next year. In the corporate market, supply should slow as smaller capital expenditure budgets and the reduced need to term out debt should take center stage. This stronger technical underpinning and the likelihood of a recovery next year bodes well for the corporate market in the first half of 2002. The U.S. Treasury market is likely to retreat from its current levels in such a scenario with the yield curve "flattening" as short-term yields retreat faster than longer rates. Given this scenario, the portfolio will continue to favor an overweight in the spread sectors while positioning itself along the curve to take advantage of the projected shift in the term structure of interest rates. Further, diversification and liquidity enhancement will be stressed. - ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/Comprised of 50% of the return of the Lehman Brothers Corporate Bond Index and 50% of the return of the Lehman Brothers Government Bond Index. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /4/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /5/Current investment subadvisor assignment became effective 3/13/00. /6/Inception date is 7/10/2000. /7/Inception date is 4/1/1994. ix High Yield Bond Fund Investment Seeks the highest possible total return consistent with Objective: conservation of capital through investment in a diversified portfolio of high yielding, high-risk fixed- income securities. To achieve this objective, AGIM invests at least 65% of the Fund's total assets in below investment-grade U.S. and foreign junk bonds. These high yielding, high-risk fixed-income securities are rated below Baa3 by Moody's and BBB- by S&P or comparable investment quality at the time of purchase. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Gordon Massie Manager: Inception Date: November 2, 1998/5/ Change in Value of $10,000 Investment and Comparative Indices High Yield Bond Fund [CHART] SSB High 4.75% Sales Yield Market NAV Charge Index 11/1998 $10,000 $9,525 $10,000 12/1998 10,106.15 9,626.11 10,494.11 03/1999 10,498.87 10,000.17 10,651.21 06/1999 10,518.46 10,018.83 10,679.54 09/1999 10,359.19 9,867.12 10,495.22 12/1999 10,515.1 10,015.63 10,676.23 03/2000 10,194.57 9,710.33 10,396.98 06/2000 10,394.37 9,900.64 10,524.28 09/2000 10,545.59 10,044.68 10,603.02 12/2000 9,822.67 9,356.09 10,069.9 03/2001 10,369.81 9,877.24 10,679.18 06/2001 10,070.24 9,591.9 10,396.98 09/2001 9,811.6 9,345.55 9,964.31 10/2001 10,008.89 9,533.47 10,295.25 Performance Table
Average Annual Cumulative Total Return Total Return ---------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2001/5/ ------ --------- ------------ Salomon Smith Barney High Yield Market Index/1/ 0.06% 0.97% 2.95% High Yield Bond Fund Class A (NAV) -2.23% 0.03% 0.09% High Yield Bond Fund Class A (net of 4.75% sales charge) -6.90% -1.58% -4.67% High Yield Bond Fund Class B (NAV) -2.84% -0.73% -2.17% High Yield Bond Fund Class B (net of CDSC)/2/ -7.25% -2.07% -6.09% High Yield Bond Fund Class C (NAV)/4/ -2.84% -5.08% -6.03% High Yield Bond Fund Class C (net of CDSC)/3/,/4/ -3.72% -5.08% -6.03% High Yield Bond Fund Institutional Class I -2.30% 0.08% 0.24% High Yield Bond Fund Institutional Class II -2.07% 0.30% 0.90%
x Portfolio Manager's Commentary: The High Yield Bond Fund Class A performance for the year ending October 31, 2001 was - 2.23%, underperforming the Salomon Smith Barney High Yield Market Index return of 0.06%. The index performance for the year was characterized by high monthly volatility due to concerns over slowing economic growth, rising default rates and less liquid capital markets. After net negative returns in November and December 2000, the high yield market posted its largest monthly gain in nearly ten years in the month of January 2001. Year-to-date returns continued positive until after the September 11 tragedy. The high yield market posted a negative 6% return in September but regained a portion of this in October. Coupon income was entirely offset by negative price returns to result in the basically zero return for the index. The Fund underperformed the high yield index due to negative contributions from the Telecommunications, Textile, Gaming and Metals industries. This was partially offset by positive contributions from the Energy, Healthcare, Pharmaceutical, Homebuilding, and Automobile industries. Currently, the high yield market faces several challenges from the current recession, higher than normal default rates, market illiquidity and restricted access to the capital markets. We believe returns in the overall high yield market will depend on several key macro trends including worldwide Gross Domestic Product growth, bank lending standards and high yield market inflows/outflows. As a result, we have positioned more of the portfolio in higher credit quality issues that can weather the economic downturn. However, if the high yield market and/or the economic growth rebound faster than expected, the portfolio could slightly lag the market. On a more positive note, recently, fund flows into the high yield market have been positive. The primary sources include mutual fund inflows, new CBO's, new allocations to high yield by pension funds and equity and distressed funds. Combined with already sizeable cash balances at many high yield funds, there is significant buying power for good solid high yield credits. For this reason, we have decreased the cash position of the fund to be nearly fully invested. We believe there are opportunities to outperform the high yield market with superior credit and industry selection. We are currently focused on companies and industries with solid credit fundamentals, strong asset values and no need to access the capital markets in the near term. - ----------------------------------------------- /1/All since inception returns for indices begin on the month-end closest to the actual inception date of the Fund. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Inception date is 8/21/2000. /5/Performance information shown for periods prior to July, 7 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xi Strategic Income Fund Investment Seeks a high level of total return consistent with Objective: preservation of capital. To achieve this objective, AGIM invests at least 65% of the Fund's total assets in a broad range of fixed-income securities. Those securities include investment grade bonds, U.S. Government and agency obligations, mortgage-backed securities, and U.S., Canadian, and foreign high-risk, high-yield bonds (commonly known as "junk bonds"). Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Steve Guterman Manager: Inception Date: November 1, 1993 Change in Value of $10,000 Investment and Comparative Indices Strategic Income Fund [CHART] 5.75% Sales LB Aggregate NAV Charge Bond Index 11/1993 $10,000 $9,525 $10,000 11/1993 10,018.55 9,542.67 9,915 12/1993 10,122.21 9,641.4 9,968.54 01/1994 10,283.34 9,794.88 10,103.12 02/1994 10,000.57 9,525.54 9,927.32 03/1994 9,539.29 9,086.17 9,682.12 04/1994 9,444.27 8,995.67 9,604.66 05/1994 9,567.23 9,112.79 9,603.7 06/1994 9,521.98 9,069.69 9,582.57 07/1994 9,564.35 9,110.04 9,773.26 08/1994 9,615.20 9,158.48 9,784.99 09/1994 9,637.58 9,179.8 9,641.15 10/1994 9,620.68 9,163.7 9,632.48 11/1994 9,561.16 9,107.01 9,611.28 12/1994 9,434.6 8,986.46 9,677.6 01/1995 9,448.25 8,999.46 9,869.22 02/1995 9,543.12 9,089.82 10,104.11 03/1995 9,592.15 9,136.52 10,165.74 04/1995 9,899.06 9,428.86 10,308.06 05/1995 10,244.25 9,757.65 10,706.98 06/1995 10,380.67 9,887.59 10,785.15 07/1995 10,428.11 9,932.78 10,761.42 08/1995 10,463.06 9,966.06 10,891.63 09/1995 10,642.38 10,136.87 10,997.28 10/1995 10,720.16 10,210.96 11,140.24 11/1995 10,905.51 10,387.5 11,307.35 12/1995 11,186.86 10,655.48 11,465.65 01/1996 11,685.17 11,130.13 11,541.32 02/1996 11,496.7 10,950.61 11,340.51 03/1996 11,502.33 10,955.97 11,261.12 04/1996 11,644.65 11,091.53 11,198.06 05/1996 11,737.1 11,179.59 11,175.66 06/1996 11,867.89 11,304.16 11,325.42 07/1996 11,924.43 11,358.02 11,356 08/1996 12,107.51 11,532.4 11,336.69 09/1996 12,494.2 11,900.73 11,533.95 10/1996 12,579.89 11,982.35 11,790 11/1996 12,812.41 12,203.82 11,991.61 12/1996 12,844.64 12,234.52 11,880.09 01/1997 13,004.71 12,386.98 11,916.92 02/1997 13,153.05 12,528.28 11,946.71 03/1997 12,926.22 12,312.22 11,814.1 04/1997 13,071.63 12,450.73 11,991.31 05/1997 13,355.92 12,721.52 12,105.23 06/1997 13,518.04 12,875.94 12,249.28 07/1997 13,886.24 13,226.64 12,580.01 08/1997 13,835.42 13,178.23 12,473.08 09/1997 14,111.76 13,441.45 12,657.69 10/1997 13,910.09 13,249.37 12,841.22 11/1997 14,090.16 13,420.88 12,900.29 12/1997 14,225.86 13,550.13 13,030.58 01/1998 14,383.06 13,699.86 13,197.38 02/1998 14,497.75 13,809.11 13,186.82 03/1998 14,567.25 13,875.31 13,231.65 04/1998 14,602.25 13,908.64 13,300.46 05/1998 14,594.78 13,901.53 13,426.81 06/1998 14,561.01 13,869.36 13,540.94 07/1998 14,615.07 13,920.86 13,569.38 08/1998 13,616.8 12,970 13,790.56 09/1998 14,024.51 13,358.35 14,113.26 10/1998 13,940.86 13,278.67 14,038.46 11/1998 14,304.36 13,624.9 14,118.48 12/1998 14,328.51 13,647.91 14,160.83 01/1999 14,274.44 13,596.4 14,261.37 02/1999 14,187.82 13,513.9 14,011.8 03/1999 14,404.67 13,720.45 14,088.86 04/1999 14,677.52 13,980.34 14,133.95 05/1999 14,355.74 13,673.84 14,009.57 06/1999 14,309.94 13,630.22 13,964.74 07/1999 14,231.7 13,555.69 13,906.09 08/1999 14,070.96 13,402.59 13,899.13 09/1999 14,209.81 13,534.85 14,060.36 10/1999 14,233.74 13,557.64 14,112.39 11/1999 14,408.12 13,723.74 14,110.98 12/1999 14,523.61 13,l833.74 14,043.24 01/2000 14,512.93 13,823.56 13,996.9 02/2000 14,623 13,928.41 14,166.26 03/2000 14,716.39 14,017.36 14,353.26 04/2000 14,507.74 13,818.62 14,311.63 05/2000 14,404.8 13,720.57 14,304.48 06/2000 14,747.18 14,046.69 14,602.01 07/2000 14,956.26 14,245.84 14,734.89 08/2000 15,222.35 14,499.29 14,948.54 09/2000 15,149.16 14,429.58 15,042.72 10/2000 14,816.23 14,112.46 15,142 11/2000 14,590.74 13,897.68 15,390.33 12/2000 14,987.96 14,276.03 15,676.59 01/2001 15,583.99 14,843.75 15,932.12 02/2001 15,684.31 14,939.31 16,070.73 03/2001 15,477.17 14,742 16,151.08 04/2001 15,283.28 14,557.32 16,083.25 05/2001 15,441.41 14,707.94 16,179.75 06/2001 15,424.25 14,691.6 16,241.23 07/2001 15,526.58 14,789.07 16,605.03 08/2001 15,792.5 15,042.36 16,795.99 09/2001 15,409.59 14,677.64 16,990.83 10/2001 15,776.06 15,026.7 17,345.93 Performance Table
Average Annual Cumulative Total Return Total Return --------------------------------- -------------------- 1 5 Since Since Since Since Periods Ending October Year Years Inception 3/13/00/3/ Inception 3/13/00/3/ 31, 2001 ------ ----- --------- ---------- --------- ---------- Lehman Brothers Aggregate Bond Index/6/ 14.56% 8.03% 7.13% 12.86% 73.46% 22.45% Strategic Income Fund Class A (NAV) 6.48% 4.63% 5.87% 4.03% 57.76% 6.68% Strategic Income Fund Class A (net of 4.75% sales charge) 1.40% 3.62% 5.22% 0.98% 50.27% 1.61% Strategic Income Fund Class B (NAV)/5/ 5.65% 3.93% 6.15% 3.22% 57.27% 5.32% Strategic Income Fund Class B (net of CDSC)/1/,/5/ 0.80% 3.59% 6.15% 0.20% 57.27% 0.32% Strategic Income Fund Class C (NAV)/5/ 5.65% 3.93% 6.15% 3.22% 57.23% 5.31% Strategic Income Fund Class C (net of CDSC)/2/,/5/ 4.68% 3.93% 6.15% 3.22% 57.23% 5.31% Strategic Income Fund Institutional Class I/4/ 6.63% N/A 4.95% N/A 6.53% N/A
xii Portfolio Manager's Commentary: The Strategic Income Fund's Class A performance for the year ending October 31, 2001 was 6.48% as compared to the return of the Fund's benchmark, the Lehman Brothers Aggregate Bond Index, of 14.56%. There were two very connected major themes driving the world's bond markets over the past year, 1) flight to quality and 2) lowering of interest rates. Even before the terrorist events of September 11, 2001, the fixed income markets were favoring intermediate and long treasury and government bonds as a way to take advantage of lower interest rates resulting from the multiple cuts in the Fed Funds rate. In addition, credit quality of corporate bonds was generally deteriorating throughout the year, further increasing the attractiveness of the U.S. Treasury market. The U.S. Government segment of the Lehman Brothers Aggregate Bond Index posted the best fixed income performance at 15.08%. This return propelled the overall Aggregate Bond Index to a 14.56% return. The current low interest rate environment, however, means that this segment of the market over the coming year is unlikely to match this performance. In fact, if the signals from the equity markets are correct in that the economy will rebound some time next year, then it is likely that interest rates will rise once again and hurt treasury bond prices. Emerging market debt ("EMD") was the surprise performer in 2001, returning almost 11%, as measured by the Morgan Stanley EMBI index. The performance is all the more impressive because this sector was not without its problems, most notably with Argentinean bonds. The high yields available in the EMD market clearly add to return over time. On the other hand, the corporate high yield market, after posting a very strong return in January 2001 at 7.49%, (Lehman Brothers High Yield Bond Index) was a big disappointment, just managing to squeak in a positive return of 0.58% for the past year. The high yield market has been hampered by continued high defaults and lack of strong sponsorship. Earlier in the year we saw a large return to the high yield market by individual investors purchasing shares in high yield mutual funds, but that was followed by lackluster demand for the remainder of 2001. The high level of defaults in 2001 can be traced to two factors - weak underwriting standards in 1997 and 1998, and the slowdown in U.S. economic growth. The good news is that by the middle of 2002, the majority of the impact of the poorly underwritten bonds should be behind us. Currently we find better quality companies coming to market and while concerned about the economy, we like the 8.00 to 10.00 percentage point spreads that are available. Looking forward, we are concerned about the slowdown in the U.S., especially post September 11. Consumers appear to spending, but very cautiously. This drives our interest in the high quality markets toward the agency mortgage- backed security market. For additional yield and return potential, we will keep a healthy exposure to high yield and maintain a 15% target exposure to EMD. - ----------------------------------------------- /1/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /3/Current investment subadvisor assignment became effective 3/13/00. /4/Inception date is 7/10/2000. /5/Inception date is 4/1/1994. /6/All since-inception returns for this index begin on the month-end closest to the date shown. xiii Aggressive Growth Lifestyle Fund Investment Seeks to provide growth of capital through investments in Objective: a combination of the North American Funds. The Fund is suitable for investors seeking the potential growth of capital that a fund investing predominantly in equity securities may offer Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Steve Guterman, Magali Azema-Barac, William Trimbur Managers: Inception Date: November 2, 1998/5/ Change in Value of $10,000 Investment and Comparative Indices NAF Aggressive Growth Lifestyle Fund Class A [CHART] 5.75% Sales S&P 500 Blended Benchmark NAV Charge Index Index 11/1998 $10,000 $9,425 $10,000 $10,000 12/1998 10,794 10,173 11,217 10,976 03/1999 10,904 10,277 11,775 11,019 06/1999 11,818 11,138 12,605 11,903 09/1999 11,550 10,886 11,819 11,421 12/1999 13,914 13,114 13,577 12,998 03/2000 14,655 13,813 13,889 13,544 06/2000 14,257 13,437 13,520 13,222 09/2000 14,462 13,631 13,389 13,008 12/2000 13,272.22 12,509.07 12,341.22 12,097.49 03/2001 11,347.55 10,695.06 10,878.15 10,748.6 06/2001 11,868.81 11,186.36 11,514.78 11,239.89 09/2001 10,144.63 9,561.31 9,824.7 9,724.41 10/2001 10,452.04 9,851.05 10,012.06 10,079 Performance Table
Average Annual Cumulative Total Return Total Return ----------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2001/5/ ------- --------- ------------ Aggressive Growth LifeStyle Blended Benchmark Index/1/ -21.85% 0.26% 0.79% S&P 500 Index -24.90% 0.04% 0.12% Aggressive Growth LifeStyle Fund Class A (NAV) -24.89% 1.49% 4.52% Aggressive Growth LifeStyle Fund Class A (net of 5.75% sales charge) -29.23% -0.50% -1.49% Aggressive Growth LifeStyle Fund Class B (NAV) -25.39% 1.22% 3.71% Aggressive Growth LifeStyle Fund Class B (net of CDSC)/2/ -28.46% -0.10% -0.29% Aggressive Growth LifeStyle Fund Class C (NAV)/4/ -25.33% -22.35% -26.64% Aggressive Growth LifeStyle Fund Class C (net of CDSC)/3/,/4/ -25.94% -22.35% -26.64% Aggressive Growth LifeStyle Fund Institutional Class I -24.81% 1.52% 4.61%
xiv Portfolio Managers' Commentary: The Aggressive Growth Lifestyle Fund Class A share performance for the year ended October 31, 2001 was - 24.89%, moderately underperforming the Aggressive Growth Lifestyle Blended Benchmark Index (10% Lehman Aggregate, 25% EAFE, and 65% Wilshire 5000) return of - 21.85%. The financial markets were a tale of two styles and a tale of two sectors throughout the twelve months ended October 31, 2001. Essentially, growth equity stocks far undershot their value counterparts - the Russell 2000 Growth Index declined 31.50%, while the Russell 2000 Value Index rose 8.75%. Similarly, equities performed noticeably weaker than fixed income - The Standard & Poor's 500 Stock Index declined 24.90% while the Lehman Aggregate Bond Index advanced 14.56%. These domestic patterns were mirrored in many foreign markets. The Morgan Stanley Capital International EAFE index which included returns from 21 non-U.S. equity markets fell 24.93%, while the Salomon Non-U.S. World Government Bond Index, which includes most of the same 21 nations, rose 6.81%. Economic cycles here and abroad were largely synchronous. Recessionary conditions prevailed in most countries. The manufacturing sector was weak, service industries fared best, steady earning stocks such as food and beverage companies were bought, and highly valued growth companies such as cellular telephone equipment were sold. In most nations, the central banks aggressively reduced short-term rates and investors sought the safety (and return) of government issued bonds. The Aggressive Growth Lifestyle Fund fared disappointingly throughout this volatile period. Consistent with the Fund name and investment objective, a portion of assets was kept in the growth equity area. This allocation pulled down the entire Fund's return. Growth equity holdings are core. Similarly, value and international equities as well as fixed income are core. We maintain at all times an allocation to these sectors and classes. We do not attempt to time short-term rotations. Also, the Fund is designed to provide these returns over several investment and economic cycles. During the past year growth was extraordinarily weak. Looking ahead, economic recovery appears likely by the second quarter of 2002. In such an environment, growth equities should have solidly positive returns. Also, in such a period, fixed income returns should decline. Accordingly, management will evaluate carefully any asset allocation shifts that would prove rewarding for a period of rising economic growth. - ----------------------------------------------- /1/As of 05/01/00, benchmark for the Aggressive Growth Lifestyle consists of 10% Lehman Aggregate, 25% EAFE, and 65% Wilshire 5000. Prior to 05/01/00; Benchmark for Growth Lifestyle consists of 15% EAFE, 15% Salomon Brothers Primary Market Index, 13% S&P 500, 12% Russell 1000 Value, 10% Russell 2000 Growth, 10% Russell 2000 Value, 10% Lehman Aggregate, 8% Russell MidCap Value, 7% Russell MidCap Growth. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Inception date is 8/10/2000. /5/Performance information shown for periods prior to July, 7 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xv Moderate Growth Lifestyle Fund Investment Seeks to provide growth of capital and current income Objective: through investments in a combination of the North American Funds. The Fund is suitable for investors who wish to invest in equity securities, but are not willing to assume the substantial market risks of the Aggressive Growth LifeStyle Fund. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Steve Guterman, Magali Azema-Barac, William Trimbur Managers: Inception Date: November 2, 1998/5/ Change in Value of $10,000 Investment and Comparative Indices NAF Conservative Growth Lifestyle Class A [CHART] 5.75% Sales S&P 500 Blended Bench- NAV Charge Index mark Index 11/1998 $10,000 $9,425 $10,000 $10,000 12/1998 10,764 10,145 11,217 10,821 03/1999 10,812 10,109 11,775 10,857 06/1999 11,563 10,898 12,605 11,621 09/1999 11,184 10,541 11,819 11,122 12/1999 12,772 12,038 13,577 12,312 03/2000 13,379 12,609 13,889 12,812 06/2000 13,126 12,371 13,520 12,638 09/2000 13,395 12,625 13,389 12,614 12/2000 12,693.59 11,963.71 12,341.22 11,998.19 03/2001 11,570.26 10,904.97 10,878.15 11,037.71 06/2001 11,944.71 11,257.89 11,514.78 11,491.15 09/2001 10,821.38 10,199.15 9,824.7 10,372.84 10/2001 11,083.49 10,446.19 10,012.06 10,668 Performance Table
Average Annual Cumulative Total Return Total Return ----------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2001/5/ ------- --------- ------------ Moderate Growth LifeStyle Blended Benchmark Index/1/ -14.64% 2.18% 6.68% S&P 500 Index -24.90% 0.04% 0.12% Moderate Growth LifeStyle Fund Class A (NAV) -15.06% 3.50% 10.83% Moderate Growth LifeStyle Fund Class A (net of 5.75% sales charge) -19.97% 1.47% 4.46% Moderate Growth LifeStyle Fund Class B (NAV) -15.56% 3.30% 10.20% Moderate Growth LifeStyle Fund Class B (net of CDSC)/2/ -19.23% 2.03% 6.20% Moderate Growth LifeStyle Fund Class C (NAV)/5/ -15.69% -13.82% -17.63% Moderate Growth LifeStyle Fund Class C (net of CDSC)/3/,/4/ -16.43% -13.82% -17.63% Moderate Growth LifeStyle Fund Institutional Class I -14.97% 3.53% 10.94%
xvi Portfolio Managers' Commentary: The Moderate Growth Lifestyle Fund Class A share performance for the year ended October 31, 2001 was - 15.06%, fractionally lower than the Moderate Growth Lifestyle Blended Benchmark Index's (30% Lehman Aggregate, 15% EAFE, and 55% Wilshire 5000) return of - 14.64%. The financial markets were a tale of two styles and a tale of two sectors throughout the twelve months ended October 31, 2001. Essentially, growth equity stocks far undershot their value counterparts - the Russell 2000 Growth Index declined 31.50%, while the Russell 2000 Value Index rose 8.75%. Similarly, equities performed noticeably weaker than fixed income - The Standard & Poor's 500 Stock Index declined 24.90% while the Lehman Aggregate Bond Index advanced 14.56%. These domestic patterns were mirrored in many foreign markets. The Morgan Stanley Capital International EAFE index which included returns from 21 non-U.S. equity markets fell 24.93%, while the Salomon Non-U.S. World Government Bond Index, which includes most of the same 21 nations, rose 6.81%. Economic cycles here and abroad were largely synchronous. Recessionary conditions prevailed in most countries. The manufacturing sector was weak, service industries fared best, steady earning stocks such as food and beverage companies were bought, and highly valued growth companies such as cellular telephone equipment were sold. In most nations, the central banks aggressively reduced short-term rates and investors sought the safety (and return) of government issued bonds. The Moderate Growth Lifestyle Fund fared disappointingly throughout this volatile period. Consistent with the Fund name and investment objective, a portion of assets was kept in the growth equity area. This allocation pulled down the entire Fund's return. Growth equity holdings are core. Similarly, value and international equities as well as fixed income are core. We maintain at all times allocation to these sectors and classes. We do not attempt to time short-term rotations. Also, the Fund is designed to provide these returns over several investment and economic cycles. During the past year growth was extraordinarily weak. Looking ahead, economic recovery appears likely by the second quarter of 2002. In such an environment, growth equities should have solidly positive returns. Also, in such a period, fixed income returns should decline. Accordingly, management will evaluate carefully any asset allocation shifts that would prove rewarding for a period of rising economic growth. - ----------------------------------------------- /1/As of 05/01/00, benchmark for the Moderate Growth Lifestyle consists of 30% Lehman Aggregate, 15% EAFE, and 55% Wilshire 5000. Prior to 05/01/00; Benchmark for Moderate Growth Lifestyle consists of 7% EAFE, 8% Salomon Brothers Primary Market Index, 15% S&P 500, 15% Russell 1000 Value, 7% Russell 2000 Growth, 8% Russell 2000 Value, 25% Lehman Aggregate, 8% Russell MidCap Value, 7% Russell MidCap Growth. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Inception date is 7/12/2000. /5/Performance information shown for periods prior to July, 7 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xvii Conservative Growth Lifestyle Fund Investment Seeks current income and low to moderate growth of Objective: capital through investments in a combination of the North American Funds. The Fund is suitable for investors who wish to invest in equity securities, but are not willing to assume the substantial market risks of either the Aggressive Growth LifeStyle Fund or the Moderate Growth LifeStyle Fund. Subadvisor: American General Investment Management, L.P. ("AGIM") Portfolio Steve Guterman, Magali Azema-Barac, William Trimbur Managers: Inception Date: November 2, 1998/5/ Change in Value of $10,000 Investment and Comparative Indices NAF Conservative Growth Lifestyle Class A [CHART] 5.75% Sales S&P 500 Blended Bench- NAV Charge Index mark Index 11/1998 $10,000 $9,425 $10,000 $10,000 12/1998 10,663 10,050 11,217 10,674 03/1999 10,697 10,081 11,775 10,724 06/1999 11,267 10,691 12,605 11,299 09/1999 10,934 10,305 11,819 10,906 12/1999 12,123 11,426 13,577 11,808 03/2000 12,589 11,865 13,889 12,224 06/2000 12,484 11,766 13,520 12,147 09/2000 12,782 12,047 13,389 12,266 12/2000 12,354 11,643.65 12,341.22 11,956.65 03/2001 11,677.24 11,005.8 10,878.15 11,375.77 06/2001 11,960.25 11,272.53 11,514.78 11,757.5 09/2001 11,271.18 10,623.09 9,824.7 11,072.98 10/2001 11,541.89 10,878.23 10,012.06 11,213 Performance Table
Average Annual Cumulative Total Return Total Return ----------------- ------------ 1 Since Since Year Inception Inception Periods Ending October 31, 2001/5/ ------- --------- ------------ Conservative Growth LifeStyle Blended Benchmark Index/1/ -6.93% 3.89% 12.13% S&P 500 Index -24.90% 0.04% 0.12% Conservative Growth LifeStyle Fund Class A (NAV) -7.91% 4.91% 15.42% Conservative Growth LifeStyle Fund Class A (net of 5.75% sales charge) -13.23% 2.85% 8.78% Conservative Growth LifeStyle Fund Class B (NAV) -8.60% 4.63% 14.51% Conservative Growth LifeStyle Fund Class B (net of CDSC)/2/ -12.64% 3.39% 10.51% Conservative Growth LifeStyle Fund Class C (NAV)/4/ -8.93% -6.99% -8.88% Conservative Growth LifeStyle Fund Class C (net of CDSC)/3/,/4/ -9.73% -6.99% -8.88% Conservative Growth LifeStyle Fund Institutional Class I -7.80% 4.91% 15.43%
xviii Portfolio Managers' Commentary: The Conservative Growth Lifestyle Fund Class A share performance for the year ended October 31, 2001 was - 7.91%, modestly lower than the Conservative Growth Lifestyle Blended Benchmark Index (50% Lehman Aggregate, 8% EAFE, and 42% Wilshire 5000) return of - 6.93%. The financial markets were a tale of two styles and a tale of two sectors throughout the twelve months ended October 31, 2001. Essentially, growth equity stocks far undershot their value counterparts - the Russell 2000 Growth Index declined 31.50%, while the Russell 2000 Value Index rose 8.75%. Similarly, equities performed noticeably weaker than fixed income - The Standard & Poor's 500 Stock Index declined 24.90% while the Lehman Aggregate Bond Index advanced 14.56%. These domestic patterns were mirrored in many foreign markets. The Morgan Stanley Capital International EAFE index which included returns from 21 non-U.S. equity markets fell 24.93%, while the Salomon Non-U.S. World Government Bond Index, which includes most of the same 21 nations, rose 6.81%. Economic cycles here and abroad were largely synchronous. Recessionary conditions prevailed in most countries. The manufacturing sector was weak, service industries fared best, steady earning stocks such as food and beverage companies were bought, and highly valued growth companies such as cellular telephone equipment were sold. In most nations, the central banks aggressively reduced short-term rates and investors sought the safety (and return) of government issued bonds. The Conservative Growth Lifestyle Fund fared disappointingly throughout this volatile period. Consistent with the Fund name and investment objective, a portion of assets was kept in the growth equity area. This allocation pulled down the entire Fund's return. Growth equity holdings are core. Similarly, value and international equities as well as fixed income are core. We maintain at all times allocation to these sectors and classes. We do not attempt to time short-term rotations. Also, the Fund is designed to provide these returns over several investment and economic cycles. During the past year growth was extraordinarily weak. Looking ahead, economic recovery appears likely by the second quarter of 2002. In such an environment, growth equities should have solidly positive returns. Also, in such a period, fixed income returns should decline. Accordingly, management will evaluate carefully any asset allocation shifts that would prove rewarding for a period of rising economic growth. - ----------------------------------------------- /1/As of 05/01/00, benchmark for the Conservative Growth Lifestyle consists of 50% Lehman Aggregate, 8% EAFE, and 42% Wilshire 5000. Prior to 05/01/00; Benchmark for Conservative Growth Lifestyle consists of 5% EAFE, 5% Salomon Brothers Primary Market Index, 15% S&P 500, 15% Russell 1000 Value, 5% Russell 2000 Growth, 5% Russell 2000 Value, 40% Lehman Aggregate, 5% Russell MidCap Value, 5% Russell MidCap Growth. /2/The returns reflect the applicable Contingent Deferred Sales Charge of 5%, 5%, 4%, 3%, 2%, 1%. /3/The returns reflect the applicable Contingent Deferred Sales Charge of 1%. /4/Inception date is 7/20/2000. /5/Performance information shown for periods prior to July, 7 2000 is that of corresponding series of American General Series Portfolio Company 2 (the "AGSPC2 Fund") that was reorganized into the Fund on July 7, 2000. The AGSPC2 Fund had the same investment objective, and investment strategies and policies as does the Fund, and was also managed by the same portfolio managers. xix Report of Independent Accountants - ------------------------------------------------------------------------------- To the Board of Trustees and Shareholders of North American Funds: 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 the Growth & Income, Large Cap Growth, Mid Cap Growth, Mid Cap Value, Science & Technology, Small Cap Growth, Stock Index, Global Equity, International Equity, International Small Cap, Balanced, Core Bond, High Yield Bond, Municipal Bond, Strategic Income, U.S. Government Securities, Money Market, Municipal Money Market, Aggressive Growth LifeStyle, Moderate Growth LifeStyle and Conservative Growth LifeStyle Funds (portfolios of North American Funds, hereafter referred to as the "Funds") at October 31, 2001, the results of each of their operations for the year then ended, the changes in each of their net assets and the financial highlights for each of the periods indicated therein, 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 Funds' 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, 2001 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion. As further discussed in Note 11, the Board of Trustees approved on August 2, 2001 the agreement and plan of reorganization of the North American Funds. PricewaterhouseCoopers LLP Boston, Massachusetts December 21, 2001 1 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Growth & Large Cap Mid Cap Mid Cap Science & Income Growth Growth Value Technology Fund Fund Fund Fund Fund ------------ ------------ ------------ ----------- ------------ ASSETS: Investments in securities, at market value* (See accompanying Portfolio of Investments) (Note 2)... $230,547,246 $ 45,827,402 $ 32,935,063 $29,663,491 $ 13,657,084 Cash...................... 653 822 56,300 119 379 Receivables: Investments sold......... 5,124,803 504,841 172,942 221,006 173,912 Fund shares sold......... 152,019 124,435 42,487 27,495 2,854 Dividends................ 218,953 20,204 4,813 16,203 538 Interest................. 49 - - 77 4,307 Foreign tax withholding reclaims................ - 92 - - - From investment adviser.. - 111,273 79,072 46,899 73,429 ------------ ------------ ------------ ----------- ------------ Total Assets............ 236,043,723 46,589,069 33,290,677 29,975,290 13,912,503 ------------ ------------ ------------ ----------- ------------ LIABILITIES: Payables: Investments purchased.... - 234,729 23,301 252,738 25,615 Fund shares redeemed..... 1,171,605 78,038 70,328 74,866 19,209 Dividend and interest withholding tax......... - - 30 - - Investment adviser....... 91,816 - - - - Custodian and transfer agent fees.............. 60,059 27,630 18,484 13,836 17,293 Distribution fee......... 168,271 16,274 16,586 9,571 3,250 Other accrued expenses... 91,004 17,433 13,665 11,052 4,992 ------------ ------------ ------------ ----------- ------------ Total Liabilities....... 1,582,755 374,104 142,394 362,063 70,359 ------------ ------------ ------------ ----------- ------------ NET ASSETS................ $234,460,968 $46,214,965 $33,148,283 $29,613,227 $13,842,144 ------------ ------------ ------------ ----------- ------------ NET ASSETS CONSIST OF: Accumulated undistributed net realized gain (loss) on investments, foreign currency and forward foreign currency contracts (Note 2)....... $3,418,073 ($31,034,468) ($17,214,601) $1,228,153 ($14,736,446) Unrealized appreciation (depreciation) on: Investments............... 3,575,959 (5,159,790) (17,279,436) (1,279,770) (4,451,571) Foreign currency and forward foreign currency contracts................ - (9) - - - Capital shares at par value of $.001 (Note 3).. 12,722 4,537 4,227 2,428 4,400 Additional paid-in capital.................. 227,454,214 82,404,695 67,638,093 29,662,416 33,025,761 ------------ ------------ ------------ ----------- ------------ NET ASSETS................ $234,460,968 $46,214,965 $33,148,283 $29,613,227 $13,842,144 ------------ ------------ ------------ ----------- ------------ *Investments in securities, at identified cost (Note 2)............ $226,971,287 $50,987,192 $50,214,499 $30,943,261 $18,108,655 ------------ ------------ ------------ ----------- ------------
The accompanying notes are an integral part of the financial statements. 2 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - continued - OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Growth & Large Cap Mid Cap Mid Cap Science & Income Growth Growth Value Technology Fund Fund Fund Fund Fund ----------- ----------- ----------- ----------- ---------- NET ASSETS VALUES: Class A Shares Net assets at value.... $39,683,318 $5,182,955 $5,311,007 $3,320,021 $2,672,794 Shares outstanding..... 2,110,021 498,001 654,300 268,155 840,551 Net asset value and redemption price per share.................. $18.81 $10.41 $8.12 $12.38 $3.18 ------ ------ ----- ------ ----- Public offering price per share (100/94.25 of NAV) On sales of $100,000 or more the offering price is reduced............. $19.96 $11.05 $8.62 $13.14 $3.37 ------ ------ ----- ------ ----- Class B Shares Net assets at value.... $58,377,646 $18,139,482 $13,104,689 $9,947,184 $9,408,492 Shares outstanding..... 3,215,349 1,819,752 1,708,346 827,296 2,995,332 Net asset value, offering and redemption price per share........ $18.16 $9.97 $7.67 $12.02 $3.14 ------ ----- ----- ------ ----- Class C Shares Net assets at value.... $92,953,400 $7,384,333 $7,747,784 $4,409,849 $939,959 Shares outstanding..... 5,093,210 740,839 1,008,569 367,968 306,866 Net asset value, offering and redemption price per share........ $18.25 $9.97 $7.68 $11.98 $3.06 ------ ----- ----- ------ ----- Class I Shares Net assets at value.... $43,446,604 $15,508,195 $6,984,803 $11,936,173 $820,899 Shares outstanding..... 2,301,949 1,478,434 855,536 965,423 257,539 Net asset value, offering and redemption price per share........ $18.87 $10.49 $8.16 $12.36 $3.19 ------ ------ ----- ------ -----
The accompanying notes are an integral part of the financial statements. 3 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - continued - OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Small Cap Stock Global International International Growth Index Equity Equity Small Cap Fund Fund Fund Fund Fund ----------- ----------- ------------ ------------- ------------- ASSETS: Investments in securities, at market value*# (See accompanying Portfolio of Investments) (Note 2)... $30,207,935 $30,895,855 $16,017,091 $36,731,643 $9,977,351 Receivable for forward foreign currency contracts to sell (Note 2)....................... - - 1,733 - 1,060,142 Forward foreign currency contracts to buy, at value.................... - - - - 177,969 Cash...................... 895 375 976 166 134,406 Cash, segregated.......... - - - 447,286 - Foreign currency (Cost $183,022 and $200,786, respectively............. - - - 182,057 273,120 Investment in State Street Bank & Trust Company Navigator Securities Lending Trust held as collateral for securities on loan, at value (Note 2)....................... 2,000 - 163,444 114,856 - Variation margin receivable for open futures contracts........ - - - 17,020 - Receivables: Investments sold......... 197,520 1,624 37,401 3,778 1,192,487 Fund shares sold......... 64,107 11,348 3,319 494,815 109,178 Dividends................ 981 24,441 10,079 59,880 6,264 Interest................. 212 141 - 151 697 Foreign tax withholding reclaims................ - - 8,387 14,246 4,404 From investment adviser.. 101,670 78,406 - 91,988 189,906 ----------- ----------- ------------ ----------- ------------ Total Assets............ 30,575,320 31,012,190 16,242,430 38,157,886 13,125,924 ----------- ----------- ------------ ----------- ------------ LIABILITIES: Forward foreign currency contracts to sell, at value (Note 2)........... - - 1,760 - 1,058,884 Variation margin payable for open futures contracts................ - 26,445 - - - Payables: Forward foreign currency contracts to buy (Note 2)...................... - - - - 178,152 Investments purchased.... 1,130,959 2,444 - - 521,361 Fund shares redeemed..... 37,308 20,143 1,198,339 380,537 51,491 Dividend and interest withholding tax......... - - 1,152 9,514 2,309 Investment adviser....... - - 40,923 - - Custodian and transfer agent fees.............. 18,725 14,574 14,012 25,325 31,789 Securities lending....... 2,000 - 163,444 114,856 - Distribution fee......... 5,201 8,220 15,961 13,479 3,583 Due to custodian......... - - 34,535 - - Other accrued expenses... 11,045 11,161 5,971 14,565 10,259 ----------- ----------- ------------ ----------- ------------ Total Liabilities....... 1,205,238 82,987 1,476,097 558,276 1,857,828 ----------- ----------- ------------ ----------- ------------ NET ASSETS................ $29,370,082 $30,929,203 $14,766,333 $37,599,610 $11,268,096 ----------- ----------- ------------ ----------- ------------ NET ASSETS CONSIST OF: Undistributed net investment income (loss) (Note 2)................. - $41,204 - $252,691 - Accumulated undistributed net realized gain (loss) on investments, foreign currency and forward foreign currency contracts (Note 2)....................... ($7,265,506) (967,950) ($12,380,479) (2,015,346) ($10,042,380) Unrealized appreciation (depreciation) on: Investments............... (4,809,596) (6,931,583) (1,671,683) (10,828,947) (18,174) Futures contracts......... - 9,792 - (96,548) - Foreign currency and forward foreign currency contracts................ - - (520) (2,629) (1,802) Capital shares at par value of $.001 (Note 3).. 2,591 3,310 2,205 5,353 1,152 Additional paid-in capital.................. 41,442,593 38,774,430 28,816,810 50,285,036 21,329,300 ----------- ----------- ------------ ----------- ------------ NET ASSETS................ $29,370,082 $30,929,203 $14,766,333 $37,599,610 $11,268,096 ----------- ----------- ------------ ----------- ------------ *Investments in securities, at identified cost (Note 2)............ $35,017,531 $37,827,438 $17,688,774 $47,560,590 $9,995,525 ----------- ----------- ------------ ----------- ------------ # Value of securities on loan (Note 2)............ $980 $- $155,232 $109,592 $- ----------- ----------- ------------ ----------- ------------
The accompanying notes are an integral part of the financial statements. 4 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - continued - OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Small Cap Stock Global International International Growth Index Equity Equity Small Cap Fund Fund Fund Fund Fund ----------- ----------- ---------- ------------- ------------- NET ASSETS VALUES: Class A Shares Net assets at value.... $4,511,797 $7,639,105 $3,775,181 $6,644,806 $2,512,459 Shares outstanding..... 393,428 813,165 551,247 935,381 246,693 Net asset value and redemption price per share.................. $11.47 $9.39 $6.85 $7.10 $10.18 ------ ----- ----- ----- ------ Public offering price per share (100/94.25 of NAV) On sales of $100,000 or more the offering price is reduced............. $12.17 $9.96 $7.27 $7.53 $10.80 ------ ----- ----- ----- ------ Class B Shares Net assets at value.... $11,158,140 $21,904,899 $3,120,659 $9,710,381 $5,028,443 Shares outstanding..... 1,004,490 2,347,741 470,727 1,404,608 520,265 Net asset value, offering and redemption price per share........ $11.11 $9.33 $6.63 $6.91 $9.67 ------ ----- ----- ----- ----- Class C Shares Net assets at value.... $2,118,878 $1,385,199 $7,870,493 $2,786,412 $3,727,194 Shares outstanding..... 190,712 149,366 1,182,520 404,198 383,838 Net asset value, offering and redemption price per share........ $11.11 $9.27 $6.66 $6.89 $9.71 ------ ----- ----- ----- ----- Class I Shares Net assets at value.... $11,581,267 $18,458,011 Shares outstanding..... 1,002,600 2,609,314 Net asset value, offering and redemption price per share........ $11.55 $7.07 ------ -----
The accompanying notes are an integral part of the financial statements. 5 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - continued - OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Core High Yield Municipal Strategic Balanced Bond Bond Bond Income Fund Fund Fund Fund Fund ----------- ------------ ----------- ----------- ----------- ASSETS: Investments in securities, at market value*# (See accompanying Portfolio of Investments) (Note 2).. $44,094,999 $453,448,404 $69,114,419 $16,328,936 $33,472,966 Cash.................... 914 723 784 - - Investment in State Street Bank & Trust Company Navigator Securities Lending Trust held as collateral for securities on loan, at value (Note 2)......... - 13,329,728 - - 712,180 Receivables: Investments sold....... 257,656 - - 1,028,360 5,798 Fund shares sold....... 5,290 11,346 66,099 - 424 Dividends.............. 30,232 - - - - Interest............... 245,492 4,318,304 1,826,517 195,862 625,140 Foreign tax withholding reclaims.............. 4,537 - - - 3,900 From investment adviser............... - - - 17,758 - ----------- ------------ ----------- ----------- ----------- Total Assets.......... 44,639,120 471,108,505 71,007,819 17,570,916 34,820,408 ----------- ------------ ----------- ----------- ----------- LIABILITIES: Payables: Investments purchased.. - 89,953,864 467,285 1,023,750 995,917 Fund shares redeemed... 257,359 4,324,646 39,172 128,897 104,140 Dividends.............. - 13,039 14,414 12,624 74,403 Dividend and interest withholding tax....... - 5,028 1,250 - 35 Investment adviser..... 20,283 57,634 20,021 - 68,358 Custodian and transfer agent fees............ 13,090 54,484 14,488 6,016 7,222 Securities lending..... - 13,329,728 - - 712,180 Distribution fee....... 29,504 9,265 4,117 800 22,455 Due to custodian....... - - - - 109,876 Other accrued expenses.............. 16,877 123,064 27,488 5,715 12,053 ----------- ------------ ----------- ----------- ----------- Total Liabilities..... 337,113 107,870,752 588,235 1,177,802 2,106,639 ----------- ------------ ----------- ----------- ----------- NET ASSETS.............. $44,302,007 $363,237,753 $70,419,584 $16,393,114 $32,713,769 ----------- ------------ ----------- ----------- ----------- NET ASSETS CONSIST OF: Undistributed net investment income (loss) (Note 2)........ $524,794 ($15,527) $139,968 - ($42,006) Accumulated undistributed net realized gain (loss) on investments, foreign currency and forward foreign currency contracts (Note 2)..... (10,224,094) (10,182,067) (13,937,962) ($77,153) (9,743,988) Unrealized appreciation (depreciation) on: Investments............. (3,832,476) 11,349,777 (4,761,405) 700,921 (1,158,576) Foreign currency and forward foreign currency contracts..... (429) - - - (401) Capital shares at par value of $.001 (Note 3)..................... 6,127 35,294 9,346 1,600 4,214 Additional paid-in capital................ 57,828,085 362,050,276 88,969,637 15,767,746 43,654,526 ----------- ------------ ----------- ----------- ----------- NET ASSETS.............. $44,302,007 $363,237,753 $70,419,584 $16,393,114 $32,713,769 ----------- ------------ ----------- ----------- ----------- *Investments in securities, at identified cost (Note 2)..................... $47,927,475 $442,098,627 $73,875,824 $15,628,015 $34,631,542 ----------- ------------ ----------- ----------- ----------- # Value of securities on loan (Note 2).......... $- $13,437,714 $- $- $85,846 ----------- ------------ ----------- ----------- -----------
The accompanying notes are an integral part of the financial statements. 6 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - continued - OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Core High Yield Municipal Strategic Balanced Bond Bond Bond Income Fund Fund Fund Fund Fund ----------- ------------ ----------- ---------- ----------- NET ASSETS VALUES: Class A Shares Net assets at value.... $6,625,694 $5,900,740 $722,440 $8,363,203 $8,477,726 ---------- ---------- -------- ---------- ---------- Shares outstanding..... 918,799 573,447 95,608 817,405 1,091,587 ------- ------- ------ ------- --------- Net asset value and redemption price per share.................. $7.21 $10.29 $7.56 $10.23 $7.77 ----- ------ ----- ------ ----- Public offering price per share (100/94.25 of NAV for Balanced, and 100/95.25 for Core Bond, High Yield Bond, Municipal Bond and Strategic Income) On sales of $100,000 or more the offering price is reduced............. $7.65 $10.80 $7.94 $10.74 $8.16 ----- ------ ----- ------ ----- Class B Shares Net assets at value.... $10,559,525 $6,443,823 $2,910,825 $5,788,311 $9,963,510 ----------- ---------- ---------- ---------- ---------- Shares outstanding..... 1,472,545 628,009 385,608 565,252 1,284,067 --------- ------- ------- ------- --------- Net asset value, offering and redemption price per share........ $7.17 $10.26 $7.55 $10.24 $7.76 ----- ------ ----- ------ ----- Class C Shares Net assets at value.... $22,368,792 $4,540,884 $2,273,992 $2,241,600 $11,461,173 ----------- ---------- ---------- ---------- ----------- Shares outstanding..... 3,079,335 442,490 301,241 218,888 1,477,028 --------- ------- ------- ------- --------- Net asset value, offering and redemption price per share........ $7.26 $10.26 $7.55 $10.24 $7.76 ----- ------ ----- ------ ----- Class I Shares Net assets at value.... $4,747,996 $22,782,217 $3,061,824 $2,811,360 ---------- ----------- ---------- - ---------- Shares outstanding..... 657,150 2,207,675 405,812 361,239 ------- --------- ------- - ------- Net asset value, offering and redemption price per share........ $7.23 $10.32 $7.54 $7.78 ----- ------ ----- ----- Class II Shares Net assets at value.... $323,570,089 $61,450,503 - ------------ ----------- Shares outstanding..... 31,443,199 8,158,332 - ---------- --------- Net asset value, offering and redemption price per share........ $10.29 $7.53 ------ -----
The accompanying notes are an integral part of the financial statements. 7 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - continued - OCTOBER 31, 2001 - --------------------------------------------------------------------------------
U.S. Municipal Government Money Money Securities Market Market Fund Fund Fund ----------- ----------- ---------- ASSETS: Investments in securities, at market value* (See accompanying Portfolio of Investments) (Note 2)................... $67,045,434 $53,949,423 $6,695,511 Cash..................................... 682 349 - Receivables: Investments sold........................ 811,264 - - Fund shares sold........................ 1,495,604 2,019,432 12 Interest................................ 439,275 89,450 25,028 From investment adviser................. 6,754 66,610 8,455 ----------- ----------- ---------- Total Assets........................... 69,799,013 56,125,264 6,729,006 ----------- ----------- ---------- LIABILITIES: Payables: Investments purchased................... 15,076,457 - - Fund shares redeemed.................... 729,143 1,016,336 60 Dividends............................... 58,389 4,720 - Custodian and transfer agent fees....... 11,354 10,810 5,875 Distribution fee........................ 26,596 - - Other accrued expenses.................. 18,306 17,308 2,272 ----------- ----------- ---------- Total Liabilities...................... 15,920,245 1,049,174 8,207 ----------- ----------- ---------- NET ASSETS............................... $53,878,768 $55,076,090 $6,720,799 ----------- ----------- ---------- NET ASSETS CONSIST OF: Accumulated undistributed net realized gain (loss) on investments (Note 2).................... $(1,112,092) - $6,100 Unrealized appreciation (depreciation) on: Investments.............................. 1,510,824 - - Capital shares at par value of $.001 (Note 3)................................ 5,250 $55,079 6,714 Additional paid-in capital............... 53,474,786 55,021,011 6,707,985 ----------- ----------- ---------- NET ASSETS............................... $53,878,768 $55,076,090 $6,720,799 ----------- ----------- ---------- *Investments in securities, at identified cost (Note 2)........................... $65,534,610 $53,949,423 $6,695,511 ----------- ----------- ----------
The accompanying notes are an integral part of the financial statements. 8 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - continued - OCTOBER 31, 2001 - --------------------------------------------------------------------------------
U.S. Municipal Government Money Money Securities Market Market Fund Fund Fund ----------- ----------- ---------- NET ASSETS VALUES: Class A Shares Net assets at value...................... $35,479,597 $27,255,768 $3,972,038 ----------- ----------- ---------- Shares outstanding....................... 3,457,730 27,257,048 3,968,188 --------- ---------- --------- Net asset value and redemption price per share.................................... $10.26 $1.00 $1.00 ------ ----- ----- Public offering price per share (100/95.25 of NAV) On sales of $100,000 or more the offering price is reduced......................... $10.77 ------ Class B Shares Net assets at value...................... $11,000,551 $11,439,060 $2,612,853 ----------- ----------- ---------- Shares outstanding....................... 1,071,344 11,439,451 2,610,545 --------- ---------- --------- Net asset value, offering and redemption price per share.......................... $10.27 $1.00 $1.00 ------ ----- ----- Class C Shares Net assets at value...................... $7,398,620 $8,567,648 $135,908 ---------- ---------- -------- Shares outstanding....................... 720,540 8,567,564 135,825 ------- --------- ------- Net asset value, offering and redemption price per share.......................... $10.27 $1.00 $1.00 ------ ----- ----- Class I Shares Net assets at value...................... $7,813,614 - ---------- - Shares outstanding....................... 7,815,418 - --------- - Net asset value, offering and redemption price per share.......................... $1.00 -----
The accompanying notes are an integral part of the financial statements. 9 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - continued - OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Aggressive Moderate Conservative Growth Growth Growth LifeStyle LifeStyle LifeStyle Fund Fund Fund ----------- ----------- ------------ ASSETS: Investments in securities, at market value* (See accompanying Portfolio of Investments) (Note 2)................ $21,914,981 $26,719,792 $19,426,180 Cash.................................. 4,760 - - Receivables: Investments sold..................... 46,954 116,031 94,681 Fund shares sold..................... 5,096 32,865 1,760 Dividends............................ 7,730 37,401 40,683 ----------- ----------- ----------- Total Assets........................ 21,979,521 26,906,089 19,563,304 ----------- ----------- ----------- LIABILITIES: Payables: Investments purchased................ 59,445 152,941 131,398 Fund shares redeemed................. 43,931 8,792 2,800 Investment adviser................... 1,682 2,167 1,562 Distribution fee..................... 9,607 8,922 6,296 Due to custodian..................... - 495 3,965 ----------- ----------- ----------- Total Liabilities................... 114,665 173,317 146,021 ----------- ----------- ----------- NET ASSETS............................ $21,864,856 $26,732,772 $19,417,283 ----------- ----------- ----------- NET ASSETS CONSIST OF: Undistributed net investment income (loss) (Note 2)...................... - $112,009 $227,029 Accumulated undistributed net realized gain (loss) on investments (Note 2).............. ($5,188,827) (3,427,317) (2,339,802) Unrealized appreciation (depreciation) on: Investments........................... (3,747,310) (2,404,146) (796,169) Capital shares at par value of $.001 (Note 3)............................. 2,795 3,012 2,069 Additional paid-in capital............ 30,798,198 32,449,214 22,324,156 ----------- ----------- ----------- NET ASSETS............................ $21,864,856 $26,732,772 $19,417,283 ----------- ----------- ----------- *Investments in securities, at identified cost (Note 2)............. $25,662,291 $29,123,938 $20,222,349 ----------- ----------- -----------
The accompanying notes are an integral part of the financial statements. 10 NORTH AMERICAN FUNDS STATEMENT OF ASSETS AND LIABILITIES - continued - OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Aggressive Moderate Conservative Growth Growth Growth LifeStyle LifeStyle LifeStyle Fund Fund Fund ----------- ----------- ------------ NET ASSETS VALUES: Class A Shares Net assets at value.................... $3,416,973 $3,876,277 $3,458,874 ---------- ---------- ---------- Shares outstanding..................... 436,742 436,383 368,676 ------- ------- ------- Net asset value and redemption price per share.................................. $7.82 $8.88 $9.38 ----- ----- ----- Public offering price per share (100/94.25 of NAV) On sales of $100,000 or more the offering price is reduced.............. $8.30 $9.42 $9.95 ----- ----- ----- Class B Shares Net assets at value.................... $12,695,273 $13,411,786 $9,907,787 ----------- ----------- ---------- Shares outstanding..................... 1,625,275 1,512,208 1,056,430 --------- --------- --------- Net asset value, offering and redemption price per share........................ $7.81 $8.87 $9.38 ----- ----- ----- Class C Shares Net assets at value.................... $235,058 $738,025 $641,978 -------- -------- -------- Shares outstanding..................... 29,857 83,092 68,262 ------ ------ ------ Net asset value, offering and redemption price per share........................ $7.87 $8.88 $9.40 ----- ----- ----- Class I Shares Net assets at value.................... $5,517,552 $8,706,684 $5,408,644 ---------- ---------- ---------- Shares outstanding..................... 703,371 980,489 575,824 ------- ------- ------- Net asset value, offering and redemption price per share........................ $7.84 $8.88 $9.39 ----- ----- -----
The accompanying notes are an integral part of the financial statements. 11 NORTH AMERICAN FUNDS STATEMENT OF OPERATIONS - FOR THE YEAR ENDED OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Growth & Large Cap Mid Cap Mid Cap Science & Income Growth Growth Value Technology Fund Fund Fund Fund Fund ------------ ------------ ------------ ----------- ------------ INVESTMENT INCOME: Interest.................... $105,912 $205,096 $49,375 $85,371 $67,298 Dividends (Net of $11,023, $75, $1,558, $460 and $966 withholding tax, respectively).............. 3,462,739 341,031 101,561 346,161 9,724 ------------ ------------ ------------ ----------- ------------ Total income............... 3,568,651 546,127 150,936 431,532 77,022 ------------ ------------ ------------ ----------- ------------ EXPENSES: Distribution fee for Class A.......................... 151,548 25,045 28,848 12,231 12,873 Distribution fee for Class B.......................... 811,938 245,440 200,516 95,899 123,451 Distribution fee for Class C.......................... 1,299,044 130,834 138,863 34,831 11,670 Service fee for Class I..... 57,590 41,804 21,889 29,079 1,031 Investment adviser fee (Note 5)......................... 1,862,159 547,558 469,847 253,793 154,855 Custodian fee............... 173,461 50,404 43,824 35,527 26,655 Transfer agent fee.......... 653,034 485,568 350,303 200,127 313,705 Accounting/administration... 255,530 65,021 56,019 27,505 18,606 Audit and legal fees........ 139,066 37,009 29,487 22,471 14,240 Miscellaneous............... 295,587 75,766 61,234 30,976 15,692 ------------ ------------ ------------ ----------- ------------ Total expenses before expense reductions......... 5,698,957 1,704,449 1,400,830 742,439 692,778 Expenses paid indirectly (Note 9)................... (207) (612) (294) (487) (259) Reimbursement of expenses by adviser (Note 5)........... (295,939) (678,497) (420,022) (169,031) (369,514) ------------ ------------ ------------ ----------- ------------ Net expenses............... 5,402,811 1,025,340 980,514 572,921 323,005 ------------ ------------ ------------ ----------- ------------ Net investment income (loss).................... (1,834,160) (479,213) (829,578) (141,389) (245,983) ------------ ------------ ------------ ----------- ------------ REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, FOREIGN CURRENCY AND FORWARD FOREIGN CURRENCY CONTRACTS: Net realized gain (loss) on: Investments transactions.... 10,076,721 (30,032,659) (16,850,701) 1,459,325 (13,020,813) Foreign currency and forward foreign currency contracts.................. - - (2,172) (10) (3,537) Change in unrealized appreciation (depreciation) on: Investments................. (81,992,891) (6,316,913) (24,736,710) (4,238,887) (3,671,908) Translation of foreign currency and forward foreign currency contracts.................. - 5 24 - - ------------ ------------ ------------ ----------- ------------ Net gain (loss) on investments, foreign currency and forward foreign currency contracts................. (71,916,170) (36,349,567) (41,589,559) (2,779,572) (16,696,258) ------------ ------------ ------------ ----------- ------------ Net increase/(decrease) in net assets resulting from operations.................. ($73,750,330) ($36,828,780) $(42,419,137) ($2,920,961) ($16,942,241) ------------ ------------ ------------ ----------- ------------
The accompanying notes are an integral part of the financial statements. 12 NORTH AMERICAN FUNDS STATEMENT OF OPERATIONS - FOR THE YEAR ENDED OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Small Cap Stock Global International International Growth Index Equity Equity Small Cap Fund Fund Fund Fund Fund ------------ ----------- ------------ ------------- ------------- INVESTMENT INCOME: Interest................... $124,685 $144,177 $47,371 $144,206 $41,468 Dividends (Net of $6, $1,814, $23,742, $92,193 and $33,595 withholding tax, respectively)........ 16,516 382,763 209,412 692,621 239,772 ------------ ----------- ------------ ----------- ------------ Total income.............. 141,201 526,940 256,783 836,827 281,240 ------------ ----------- ------------ ----------- ------------ EXPENSES: Distribution fee for Class A......................... 19,946 28,384 21,782 25,821 14,145 Distribution fee for Class B......................... 126,447 236,014 59,852 141,404 81,980 Distribution fee for Class C......................... 26,752 11,976 122,468 36,121 63,078 Service fee for Class I.... 30,277 -- - 46,805 - Investment adviser fee (Note 5).................. 314,733 88,853 220,100 394,668 194,746 Custodian fee.............. 35,012 26,388 48,092 144,456 402,390 Transfer agent fee......... 356,428 287,777 204,910 296,412 162,357 Accounting/administration.. 34,794 32,363 9,413 41,128 20,312 Audit and legal fees....... 25,088 22,165 - 27,800 8,413 Miscellaneous.............. 47,510 32,362 36,047 82,189 36,181 ------------ ----------- ------------ ----------- ------------ Total expenses before expense reductions........ 1,016,987 766,282 722,664 1,236,804 983,602 Expenses paid indirectly (Note 9).................. (764) (260) (239) (297) (806) Reimbursement of expenses by adviser (Note 5)....... (443,778) (362,069) (105,282) (424,974) (534,731) ------------ ----------- ------------ ----------- ------------ Net expenses.............. 572,445 403,953 617,143 811,533 448,065 ------------ ----------- ------------ ----------- ------------ Net investment income (loss)................... (431,244) 122,987 (360,360) 25,294 (166,825) ------------ ----------- ------------ ----------- ------------ REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, FUTURES CONTRACTS, FOREIGN CURRENCY AND FORWARD FOREIGN CURRENCY CONTRACTS: Net realized gain (loss) on: Investments transactions... (7,186,432) (92,698) (9,638,727) (1,743,296) (9,918,115) Futures contracts.......... - (946,028) - 348,063 - Foreign currency and forward foreign currency contracts................. - - (26,299) 244,846 (311,372) Change in unrealized appreciation (depreciation) on: Investments................ (6,099,836) (8,980,472) (1,774,036) (8,662,975) (164,921) Futures contracts.......... - 118,837 - (53,808) - Translation of foreign currency and forward foreign currency contracts................. - - 3,746 8,237 224 ------------ ----------- ------------ ----------- ------------ Net gain (loss) on investments, futures contracts, foreign currency and forward foreign currency contracts................ (13,286,268) (9,900,361) (11,435,316) (9,858,933) (10,394,184) ------------ ----------- ------------ ----------- ------------ Net increase/(decrease) in net assets resulting from operations................. ($13,717,512) ($9,777,374) ($11,795,676) ($9,833,639) ($10,561,009) ------------ ----------- ------------ ----------- ------------
The accompanying notes are an integral part of the financial statements. 13 NORTH AMERICAN FUNDS STATEMENT OF OPERATIONS - FOR THE YEAR ENDED OCTOBER 31, 2001 - --------------------------------------------------------------------------------
High Yield Municipal Strategic Balanced Core Bond Bond Bond Income Fund Fund Fund Fund Fund ------------ ----------- ----------- ---------- ---------- INVESTMENT INCOME: Interest (net of $29,651 withholding tax in Core Bond)..................... $1,431,625 $23,241,540 $7,829,238 $931,091 $3,700,483 Mortgage dollar roll income.................... - 1,568,815 - - 1,523 Dividends (Net of $650 withholding tax in Balanced)................. 386,799 1,250 101,250 - 49,974 ------------ ----------- ----------- ---------- ---------- Total income.............. 1,818,424 24,811,605 7,930,488 931,091 3,751,980 ------------ ----------- ----------- ---------- ---------- EXPENSES: Distribution fee for Class A......................... 26,371 16,262 1,757 12,615 25,756 Distribution fee for Class B......................... 129,341 47,597 25,062 70,488 129,818 Distribution fee for Class C......................... 298,258 33,296 14,342 31,293 122,492 Service fee for Class I.... 13,327 55,046 4,944 -- 6,829 Investment adviser fee (Note 5).................. 427,908 2,030,057 565,423 111,529 264,911 Custodian fee.............. 37,158 233,439 40,022 13,766 14,812 Transfer agent fee......... 181,547 396,741 135,681 87,913 123,317 Accounting/administration.. 48,581 341,701 65,006 17,422 27,078 Audit and legal fees....... 25,109 231,939 43,405 16,475 21,194 Miscellaneous.............. 64,238 361,699 70,708 27,226 43,274 ------------ ----------- ----------- ---------- ---------- Total expenses before expense reductions........ 1,251,838 3,747,777 966,350 388,727 779,481 Expenses paid indirectly (Note 9).................. (208) (712) (5,626) (748) (3,711) Reimbursement of expenses by adviser (Note 5)....... (70,710) (127,278) (123,149) (108,684) (62,283) ------------ ----------- ----------- ---------- ---------- Net expenses.............. 1,180,920 3,619,787 837,575 279,295 713,487 ------------ ----------- ----------- ---------- ---------- Net investment income..... 637,504 21,191,818 7,092,913 651,796 3,038,493 ------------ ----------- ----------- ---------- ---------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS, FOREIGN CURRENCY AND FORWARD FOREIGN CURRENCY CONTRACTS: Net realized gain (loss) on: Investments transactions... (7,841,006) 9,371,745 (10,215,530) 226,555 (2,286,351) Foreign currency and forward foreign currency contracts................. (7,450) - - - (49,427) Change in unrealized appreciation (depreciation) on: Investments................ (7,340,259) 13,844,059 1,831,284 754,989 1,337,414 Translation of foreign currency and forward foreign currency contracts................. 557 - - - 30,086 ------------ ----------- ----------- ---------- ---------- Net gain (loss) on investments, foreign currency and forward foreign currency contracts................ (15,188,158) 23,215,804 (8,384,246) 981,544 (968,278) ------------ ----------- ----------- ---------- ---------- Net increase/(decrease) in net assets resulting from operations................. ($14,550,654) $44,407,622 ($1,291,333) $1,633,340 $2,070,215 ------------ ----------- ----------- ---------- ----------
The accompanying notes are an integral part of the financial statements. 14 NORTH AMERICAN FUNDS STATEMENT OF OPERATIONS - FOR THE YEAR ENDED OCTOBER 31, 2001 - --------------------------------------------------------------------------------
U.S. Municipal Government Money Money Securities Market Market Fund Fund Fund ---------- ---------- --------- INVESTMENT INCOME: Interest.................................. $3,119,545 $2,529,734 $222,059 ---------- ---------- --------- Total income............................. 3,119,545 2,529,734 222,059 ---------- ---------- --------- EXPENSES: Distribution fee for Class A.............. 113,831 - - Distribution fee for Class B.............. 95,721 - - Distribution fee for Class C.............. 72,662 - - Investment adviser fee (Note 5)........... 296,168 102,397 24,551 Custodian fee............................. 36,345 31,776 4,707 Transfer agent fee........................ 127,064 304,318 91,356 Accounting/administration................. 43,084 48,204 6,945 Audit and legal fees...................... 31,577 39,560 4,597 Miscellaneous............................. 56,940 57,270 6,832 ---------- ---------- --------- Total expenses before expense reductions.. 873,392 583,525 138,988 Expenses paid indirectly (Note 9)......... (265) (80) (1,308) Reimbursement of expenses by adviser (Note 5)....................................... (130,627) (190,495) (82,773) ---------- ---------- --------- Net expenses............................. 742,500 392,950 54,907 ---------- ---------- --------- Net investment income.................... 2,377,045 2,136,784 167,152 ---------- ---------- --------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on: Investments transactions.................. 1,609,690 771 6,100 Change in unrealized appreciation (depreciation) on: Investments............................... 2,040,802 - - ---------- ---------- --------- Net gain (loss) on investments........... 3,650,492 771 6,100 ---------- ---------- --------- Net increase/(decrease) in net assets resulting from operations................. $6,027,537 $2,137,555 $173,252 ---------- ---------- ---------
The accompanying notes are an integral part of the financial statements. 15 NORTH AMERICAN FUNDS STATEMENT OF OPERATIONS - FOR THE YEAR ENDED OCTOBER 31, 2001 - --------------------------------------------------------------------------------
Aggressive Moderate Conservative Growth Growth Growth LifeStyle LifeStyle LifeStyle Fund Fund Fund ----------- ----------- ------------ INVESTMENT INCOME: Dividends............................ $1,267,892 $1,371,798 $1,116,823 ----------- ----------- ----------- Total income........................ 1,267,892 1,371,798 1,116,823 ----------- ----------- ----------- EXPENSES: Distribution fee for Class A......... 3,780 4,043 3,509 Distribution fee for Class B......... 101,162 99,009 77,394 Distribution fee for Class C......... 1,544 4,029 3,791 Investment adviser fee (Note 5)...... 22,571 25,037 19,341 ----------- ----------- ----------- Total expenses...................... 129,057 132,118 104,035 ----------- ----------- ----------- Net investment income............... 1,138,835 1,239,680 1,012,788 ----------- ----------- ----------- REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: Net realized gain (loss) on: Investments transactions............. (5,634,965) (3,844,586) (2,450,494) Change in unrealized appreciation (depreciation) on: Investments.......................... (2,073,257) (1,549,213) (269,158) ----------- ----------- ----------- Net gain (loss) on investments...... (7,708,222) (5,393,799) (2,719,652) ----------- ----------- ----------- Net increase/(decrease) in net assets resulting from operations............ ($6,569,387) ($4,154,119) ($1,706,864) ----------- ----------- -----------
The accompanying notes are an integral part of the financial statements. 16 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
Growth & Income Large Cap Growth Mid Cap Growth Fund Fund Fund --------------------------- ------------------------ ------------------------ Year ended Year ended Year ended Year ended Year ended Year ended 10/31/01 10/31/00 10/31/01 10/31/00 10/31/01 10/31/00 ------------ ------------ ----------- ----------- ----------- ----------- OPERATIONS: Net investment income (loss)................ ($1,834,160) ($2,757,563) ($479,213) ($924,855) ($829,578) ($1,121,488) Net realized gain (loss) on: Investment transactions.......... 10,076,721 34,507,070 (30,032,659) 8,263,343 (16,850,701) 13,547,675 Futures contracts...... - - - (12,436) - - Foreign currency and forward foreign currency contracts.... - - - (1,518) (2,172) (184) Change in unrealized appreciation (depreciation) on: Investment transactions.......... (81,992,891) (28,936,197) (6,316,913) (9,827,527) (24,736,710) 1,554,570 Foreign currency and forward foreign currency contracts.... - 12 5 (12) 24 (24) ------------ ------------ ----------- ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations........ (73,750,330) 2,813,322 (36,828,780) (2,503,005) (42,419,137) 13,980,549 DISTRIBUTIONS FROM: Net realized gains on investments and foreign currency transactions Class A................ (4,562,705) (3,116,646) (75,201) (1,540,626) - (2,829,727) Class B................ (10,437,795) (9,002,149) (277,362) (5,453,064) - (8,060,558) Class C................ (16,282,653) (13,236,487) (174,496) (4,765,012) - (7,126,908) Class I................ (1,087,347) - (158,655) (1,547,819) - (1,875,158) In excess of capital Class A................ - - (1,857) - - - Class B................ - - (6,848) - - - Class C................ - - (4,308) - - - Class I................ - - (3,918) - - - Return of capital Class A................ - - - - - (13,112) Class B................ - - - - - (37,349) Class C................ - - - - - (33,023) Class I................ - - - - - (8,689) Increase (decrease) in net assets from capital share transactions (Note 3)............... 6,993,573 58,168,030 (2,409,345) 59,674,609 (689,108) 40,167,528 ------------ ------------ ----------- ----------- ----------- ----------- Increase (decrease) in net assets............. (99,127,257) 35,626,070 (39,940,770) 43,865,083 (43,108,245) 34,163,553 Net assets at beginning of period.............. 333,588,225 297,962,155 86,155,735 42,290,652 76,256,528 42,092,975 ------------ ------------ ----------- ----------- ----------- ----------- Net assets at end of period................. $234,460,968 $333,588,225 $46,214,965 $86,155,735 $33,148,283 $76,256,528 ------------ ------------ ----------- ----------- ----------- ----------- Undistributed net investment income (loss)................. $- $- $- $- $- $- ------------ ------------ ----------- ----------- ----------- -----------
The accompanying notes are an integral part of the financial statements. 17 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - -------------------------------------------------------------------------------
Mid Cap Value Science & Technology Small Cap Growth Fund Fund Fund -------------------------- -------------------------- ------------------------ Year ended Year ended Year ended 3/01/00* to Year ended Year ended 10/31/01 10/31/00(/1/) 10/31/01 10/31/00(/2/) 10/31/01 10/31/00 ----------- ------------- ----------- ------------- ----------- ----------- OPERATIONS: Net investment income (loss)................ ($141,389) ($56,913) ($245,983) ($110,297) ($431,244) ($142,291) Net realized gain (loss) on: Investment transactions.......... 1,459,325 1,363,892 (13,020,813) (1,715,633) (7,186,432) 2,190,821 Foreign currency and forward foreign currency contracts.... (10) - (3,537) (2,189) - - Change in unrealized appreciation (depreciation) on: Investment transactions.......... (4,238,887) 3,297,838 (3,671,908) (779,663) (6,099,836) (4,046,826) ----------- ----------- ----------- ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations........ (2,920,961) 4,604,817 (16,942,241) (2,607,782) (13,717,512) (1,998,296) DISTRIBUTIONS FROM: Net realized gains on investments and foreign currency transactions Class A................ (16,058) (379,796) - - (3,170) (358,063) Class B................ (41,694) (1,040,334) - - (5,473) (816,827) Class C................ (5,739) (29,983) - - (1,152) (187,658) Class I................ (59,848) (845,335) - - (4,890) (762,342) Class II............... - (181,253) - - - - In excess of capital Class A................ - - - - (285) - Class B................ - - - - (492) - Class C................ - - - - (104) - Class I................ - - - - (439) - Increase (decrease) in net assets from capital share transactions (Note 3)............... 10,324,827 10,957,731 8,717,906 24,674,261 4,263,824 41,638,630 ----------- ----------- ----------- ----------- ----------- ----------- Increase (decrease) in net assets............. 7,280,527 13,085,847 (8,224,335) 22,066,479 (9,469,693) 37,515,444 Net assets at beginning of period.............. 22,332,700 9,246,853 22,066,479 -- 38,839,775 1,324,331 ----------- ----------- ----------- ----------- ----------- ----------- Net assets at end of period................. $29,613,227 $22,332,700 $13,842,144 $22,066,479 $29,370,082 $38,839,775 ----------- ----------- ----------- ----------- ----------- ----------- Undistributed net investment income (loss)................. $- $- $- $- $- $- ----------- ----------- ----------- ----------- ----------- -----------
- --------------------- * Commencement of operations (/1/)Includes the financial results of the AGSPC2 Mid Cap Value Fund which was reorganized into North American Mid Cap Value on July 7, 2000. (/2/)IncludesTthe financial results of the AGSPC2 Science & Technology Fund which was reorganized into North American Science & Technology on July 7, 2000. The accompanying notes are an integral part of the financial statements. 18 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
Stock Index Global International Equity Fund Equity Fund Fund -------------------------- ------------------------ ------------------------ Year ended 3/01/00* to Year ended Year ended Year ended Year ended 10/31/01 10/31/00(/1/) 10/31/01 10/31/00 10/31/01 10/31/00 ----------- ------------- ----------- ----------- ----------- ----------- OPERATIONS: Net investment income (loss)................ $122,987 $169,521 ($360,360) ($547,886) $25,294 ($241,282) Net realized gain (loss) on: Investment transactions.......... (92,698) 8,715 (9,638,727) (2,278,794) (1,743,296) 6,800,924 Futures contracts...... (946,028) 164,278 - - 348,063 (90,708) Foreign currency and forward foreign currency contracts.... - - (26,299) 592,673 244,846 (99,012) Change in unrealized appreciation (depreciation) on: Investment transactions.......... (8,980,472) 678,065 (1,774,036) (9,923,239) (8,662,975) (10,872,098) Futures contracts...... 118,837 (211,262) - - (53,808) (14,920) Foreign currency and forward foreign currency contracts.... - - 3,746 (149,268) 8,237 548,727 ----------- ----------- ----------- ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations........ (9,777,374) 809,317 (11,795,676) (12,306,514) (9,833,639) (3,968,369) DISTRIBUTIONS FROM: Net investment income Class A................ (92,075) (52,418) - - - (33,276) Class B................ (71,582) (35,387) - - - (19,674) Class C................ (1,840) (19) - - - (9,233) Net realized gains on investments and foreign currency transactions Class A................ - (42,201) - (1,483,161) (945,564) (307,060) Class B................ - (114,330) - (3,256,058) (2,602,660) (1,068,998) Class C................ - - - (5,705,060) (640,247) (499,719) Class I................ - - - - (2,527,772) - Increase (decrease) in net assets from capital share transactions (Note 3)............... 6,862,842 12,770,017 (11,686,070) (22,339,662) 7,050,725 28,059,117 ----------- ----------- ----------- ----------- ----------- ----------- Increase (decrease) in net assets............. (3,080,029) 13,334,979 (23,481,746) (45,090,455) (9,499,157) 22,152,788 Net assets at beginning of period.............. 34,009,232 20,674,253 38,248,079 83,338,534 47,098,767 24,945,979 ----------- ----------- ----------- ----------- ----------- ----------- Net assets at end of period................. $30,929,203 $34,009,232 $14,766,333 $38,248,079 $37,599,610 $47,098,767 ----------- ----------- ----------- ----------- ----------- ----------- Undistributed net investment income (loss)................. $41,204 $83,714 $- $1,969 $252,691 $6,160 ----------- ----------- ----------- ----------- ----------- -----------
- --------------------- * Commencement of operations (/1/) Includes the financial results of the AGSPC2 Stock Index Fund which was reorganized into North American Stock Index on July 7, 2000. The accompanying notes are an integral part of the financial statements. 19 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
International Small Cap Balanced Core Bond Fund Fund Fund ------------------------ ------------------------ --------------------------- Year ended Year ended Year ended Year ended Year ended Year ended 10/31/01 10/31/00 10/31/01 10/31/00 10/31/01 10/31/00 ----------- ----------- ----------- ----------- ------------ ------------ OPERATIONS: Net investment income (loss)................ ($166,825) ($526,242) $637,504 $604,892 $21,191,818 $7,055,205 Net realized gain (loss) on: Investment transactions.......... (9,918,115) 2,239,050 (7,841,006) (2,311,814) 9,371,745 (6,875,365) Foreign currency and forward foreign currency contracts.... (311,372) (237,008) (7,450) 52,789 - - Change in unrealized appreciation (depreciation) on: Investment transactions.......... (164,921) (1,519,207) (7,340,259) 4,340,304 13,844,059 5,847,043 Foreign currency and forward foreign currency contracts.... 224 (1,205) 557 (853) - - ----------- ----------- ----------- ----------- ------------ ------------ Net increase (decrease) in net assets resulting from operations........ (10,561,009) (44,612) (14,550,654) 2,685,318 44,407,622 6,026,883 DISTRIBUTIONS FROM: Net investment income Class A................ - - (93,264) (155,664) (228,774) (207,981) Class B................ - - (85,846) (275,166) (227,022) (243,095) Class C................ - - (202,036) (1,059,003) (139,629) (192,049) Class I................ - - (75,342) (18) (1,126,968) (348,474) Class II............... - - - - (17,433,677) (5,963,986) Net realized gains on investments and foreign currency transactions Class A................ (263,863) (662,245) - (714,922) - - Class B................ (649,712) (1,814,636) - (1,649,177) - - Class C................ (521,890) (1,423,034) - (6,385,744) - - In excess of net investment income Class A................ - - - - (3,894) (4,740) Class B................ - - - - (3,864) (5,541) Class C................ - - - - (2,376) (4,377) Class I................ - - - - (19,180) (7,943) Class II............... - - - - (296,711) (135,934) Return of capital Class A................ - - - - - (23,205) Class B................ - - - - - (27,123) Class C................ - - - - - (21,427) Class I................ - - - - - (38,880) Class II............... - - - - - (665,413) Increase (decrease) in net assets from capital share transactions (Note 3)............... (4,295,782) 15,806,860 (7,373,161) 673,750 (11,073,776) 338,854,539 ----------- ----------- ----------- ----------- ------------ ------------ Increase (decrease) in net assets............. (16,292,256) 11,862,333 (22,380,303) (6,880,626) 13,851,751 336,991,254 Net assets at beginning of period.............. 27,560,352 15,698,019 66,682,310 73,562,936 349,386,002 12,394,748 ----------- ----------- ----------- ----------- ------------ ------------ Net assets at end of period................. $11,268,096 $27,560,352 $44,302,007 $66,682,310 $363,237,753 $349,386,002 Undistributed net investment income (loss)................. $- $- $524,794 $438,881 $(15,527) $(509,240) ----------- ----------- ----------- ----------- ------------ ------------
The accompanying notes are an integral part of the financial statements. 20 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - --------------------------------------------------------------------------------
High Yield Bond Municipal Bond Strategic Income Fund Fund Fund -------------------------- ------------------------- ------------------------- Year ended Year ended Year ended Year ended Year ended Year ended 10/31/01 10/31/00(/1/) 10/31/01 10/31/00 10/31/01 10/31/00 ----------- ------------- ----------- ----------- ----------- ----------- OPERATIONS: Net investment income (loss)................ $7,092,913 $6,741,510 $651,796 $542,222 $3,038,493 $3,480,059 Net realized gain (loss) on: Investment transactions.......... (10,215,530) (3,080,092) 226,555 3,924 (2,286,351) (3,322,029) Foreign currency and forward foreign currency contracts.... - (132) - - (49,427) (340,136) Change in unrealized appreciation (depreciation) on: Investment transactions.......... 1,831,284 (3,547,402) 754,989 228,763 1,337,414 7,259,822 Foreign currency and forward foreign currency contracts.... - - - - 30,086 (26,116) ----------- ----------- ----------- ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations........ (1,291,333) 113,884 1,633,340 774,909 2,070,215 7,051,600 DISTRIBUTIONS FROM: Net investment income Class A................ (50,183) (19,839) (333,490) (241,752) (664,338) (563,766) Class B................ (236,249) (108,244) (219,739) (179,259) (1,079,453) (1,257,549) Class C................ (133,223) (6,579) (98,567) (120,948) (1,022,493) (1,150,833) Class I................ (201,028) (1,395) - - (249,619) (58,485) Class II............... (6,579,260) (6,393,004) - - - - In excess of net investment income Class A................ - - - - - (24,282) Class B................ - - - - - (54,164) Class C................ - - - - - (49,567) Class I................ - - - - - (2,519) Return of capital Class A................ - - - - - (78,951) Class B................ - - - - - (176,110) Class C................ - - - - - (161,165) Class I................ - - - - - (8,190) Increase (decrease) in net assets from capital share transactions (Note 3)............... 13,770,624 8,349,306 (1,075,540) 3,691,639 (3,602,500) (17,290,100) ----------- ----------- ----------- ----------- ----------- ----------- Increase (decrease) in net assets............. 5,279,348 1,934,129 (93,996) 3,924,589 (4,548,188) (13,824,081) Net assets at beginning of period.............. 65,140,236 63,206,107 16,487,110 12,562,521 37,261,957 51,086,038 ----------- ----------- ----------- ----------- ----------- ----------- Net assets at end of period................. $70,419,584 $65,140,236 $16,393,114 $16,487,110 $32,713,769 $37,261,957 ----------- ----------- ----------- ----------- ----------- ----------- Undistributed net investment income (loss)................. $139,968 $215,412 $- $- $(42,006) $1,756 ----------- ----------- ----------- ----------- ----------- -----------
- --------------------- (/1/)Includes the financial results of the AGSPC2 High Yield Bond Fund which was reorganized into North American High Yield Bond on July 7, 2000. The accompanying notes are an integral part of the financial statements. 21 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - -------------------------------------------------------------------------------
U.S. Government Securities Money Municipal Money Market Fund Market Fund Fund ---------------------------- ------------------------ ------------------------- Year ended Year ended Year ended Year ended Year ended Year ended 10/31/01 10/31/00 10/31/01 10/31/00 10/31/01 10/31/00(/1/) ------------- ------------- ----------- ----------- ---------- ------------- OPERATIONS: Net investment income (loss)................ $2,377,045 $2,821,328 $2,136,784 $1,580,405 $167,152 $203,329 Net realized gain (loss) on: Investment transactions.......... 1,609,690 (1,146,358) 771 - 6,100 - Change in unrealized appreciation (depreciation) on: Investment transactions.......... 2,040,802 759,341 - - - - ------------- ------------- ----------- ----------- ---------- ---------- Net increase (decrease) in net assets resulting from operations........ 6,027,537 2,434,311 2,137,555 1,580,405 173,252 203,329 DISTRIBUTIONS FROM: Net investment income Class A................ (1,609,805) (1,814,535) (1,154,505) (772,737) (100,073) (132,291) Class B................ (420,759) (500,572) (371,505) (290,963) (63,903) (70,804) Class C................ (320,789) (442,305) (329,956) (407,623) (3,176) (234) Class I................ - - (280,818) (109,082) - - In excess of net investment income Class A................ (112,221) - - - - - Class B................ (29,332) - - - - - Class C................ (22,363) - - - - - Return of capital Class A................ - (119,523) - - - - Class B................ - (32,973) - - - - Class C................ - (29,135) - - - - Increase (decrease) in net assets from capital share transactions (Note 3)............... 5,725,929 (13,043,070) 8,049,837 27,800,384 (622,220) 844,619 ------------- ------------- ----------- ----------- ---------- ---------- Increase (decrease) in net assets............. 9,238,197 (13,547,802) 8,050,608 27,800,384 (616,120) 844,619 Net assets at beginning of period.............. 44,640,571 58,188,373 47,025,482 19,225,098 7,336,919 6,492,300 ------------- ------------- ----------- ----------- ---------- ---------- Net assets at end of period................. $53,878,768 $44,640,571 $55,076,090 $47,025,482 $6,720,799 $7,336,919 ------------- ------------- ----------- ----------- ---------- ---------- Undistributed net investment income (loss)................. $- ($433,764) $- $- $- $- ------------- ------------- ----------- ----------- ---------- ----------
- --------------------- (/1/)Includes the financial results of the AGSPC2 Municipal Money Market Fund which was reorganized into North American Municipal Money Market on July 7, 2000. The accompanying notes are an integral part of the financial statements. 22 NORTH AMERICAN FUNDS STATEMENTS OF CHANGES IN NET ASSETS - -------------------------------------------------------------------------------
Aggressive Growth Moderate Growth Conservative Growth LifeStyle LifeStyle LifeStyle Fund Fund Fund -------------------------- -------------------------- -------------------------- Year ended Year ended Year ended Year ended Year ended Year ended 10/31/01 10/31/00(/1/) 10/31/01 10/31/00(/2/) 10/31/01 10/31/00(/3/) ----------- ------------- ----------- ------------- ----------- ------------- OPERATIONS: Net investment income (loss)................ $1,138,835 $1,895,097 $1,239,680 $1,378,657 $1,012,788 $1,088,949 Net realized gain (loss) on: Investment transactions.......... (5,634,965) 2,315,208 (3,844,586) 1,725,763 (2,450,494) 1,266,446 Change in unrealized appreciation (depreciation) on: Investment transactions.......... (2,073,257) (2,664,043) (1,549,213) (1,594,261) (269,158) (993,763) ----------- ----------- ----------- ----------- ----------- ----------- Net increase (decrease) in net assets resulting from operations........ (6,569,387) 1,546,262 (4,154,119) 1,510,159 (1,706,864) 1,361,632 DISTRIBUTIONS FROM: Net investment income Class A................ (92,554) (226,879) (121,890) (169,786) (113,463) (124,818) Class B................ (303,421) (689,398) (358,375) (519,113) (323,290) (414,293) Class C................ (4,253) - (5,990) (187) (7,646) (67) Class I................ (119,238) (262,331) (177,985) (208,960) (148,339) (156,504) Class II............... - (52,621) - (48,561) - (42,954) Net realized gains on investments and foreign currency transactions Class A................ (550,156) (24,592) (398,753) (15,414) (315,942) (16,902) Class B................ (1,910,717) (68,467) (1,232,240) (48,559) (958,817) (57,065) Class C................ (29,011) - (24,654) - (20,326) - Class I................ (672,123) (19,815) (553,984) (12,830) (408,729) (14,923) Class II............... - (18,542) - (11,178) - (12,830) In excess of net investment income Class A................ (64,344) - - - - - Class B................ (210,939) - - - - - Class C................ (2,956) - - - - - Class I................ (82,894) - - - - - Increase (decrease) in net assets from capital share transactions (Note 3)............... 9,774,317 12,632,538 12,899,716 9,937,957 5,011,702 7,305,706 ----------- ----------- ----------- ----------- ----------- ----------- Increase (decrease) in net assets............. (837,676) 12,816,155 5,871,726 10,413,528 1,008,286 7,826,982 Net assets at beginning of period.............. 22,702,532 9,886,377 20,861,046 10,447,518 18,408,997 10,582,015 ----------- ----------- ----------- ----------- ----------- ----------- Net assets at end of period................. $21,864,856 $22,702,532 $26,732,772 $20,861,046 $19,417,283 $18,408,997 ----------- ----------- ----------- ----------- ----------- ----------- Undistributed net investment income (loss)................. $- $217,388 $112,009 $217,410 $227,029 $224,479 ----------- ----------- ----------- ----------- ----------- -----------
- --------------------- (/1/)Includes the financial results of the AGSPC2 Aggressive Growth LifeStyle Fund which was reorganized into North American Aggressive Growth LifeStyle on July 7, 2000. (/2/)Includes the financial results of the AGSPC2 Moderate Growth LifeStyle Fund which was reorganized into North American Moderate Growth LifeStyle on July 7, 2000. (/3/)Includes the financial results of the AGSPC2 Conservative Growth LifeStyle Fund which was reorganized into North American Conservative Growth LifeStyle on July 7, 2000. The accompanying notes are an integral part of the financial statements. 23 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Growth & Income Fund --------------------------------------------------- Class A --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $27.06 $28.78 $24.26 $21.77 $17.56 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.04) (0.09) 0.03 0.08 0.14 Net realized and unrealized gain/(loss) on investments and foreign currency (5.55) 0.80 5.45 4.14 5.26 ------------------------------------------------ Total from investment operations (5.59) 0.71 5.48 4.22 5.40 ------------------------------------------------ Distributions Dividends from net investment income - - - - (0.15) Distributions from realized capital gains (2.66) (2.43) (0.96) (1.70) (1.04) Distributions in excess of net investment income - - - (0.03) - ------------------------------------------------ Total distributions (2.66) (2.43) (0.96) (1.73) (1.19) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $18.81 $27.06 $28.78 $24.26 $21.77 - -------------------------------------------------------------------------------- Total Return (22.24%) 2.39% 23.11% 20.82% 31.95% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $39,683 $46,581 $37,210 $42,916 $34,186 Ratio of total expenses to average net assets 1.46% 1.45% 1.34% 1.34% 1.34% Ratio of net investment income (loss) to average net assets (0.18%) (0.33%) 0.11% 0.34% 0.66% Portfolio turnover rate 33% 31% 28% 18% 39% Expense ratio before reimbursement by adviser 1.57% 1.61% 1.49% 1.45% 1.50%
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Growth & Income Fund --------------------------------------------------- Class B --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $26.38 $28.28 $24.01 $21.67 $17.50 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.17) (0.26) (0.15) (0.07) 0.01 Net realized and unrealized gain/(loss) on investments and foreign currency (5.39) 0.79 5.38 4.11 5.23 ------------------------------------------------ Total from investment operations (5.56) 0.53 5.23 4.04 5.24 ------------------------------------------------ Distributions Dividends from net investment income - - - - (0.03) Distributions from realized capital gains (2.66) (2.43) (0.96) (1.70) (1.04) ------------------------------------------------ Total distributions (2.66) (2.43) (0.96) (1.70) (1.07) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $18.16 $26.38 $28.28 $24.01 $21.67 - -------------------------------------------------------------------------------- Total Return (22.75%) 1.75% 22.28% 20.04% 31.40% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $58,378 $106,464 $104,695 $75,574 $54,871 Ratio of total expenses to average net assets 2.11% 2.10% 1.99% 1.99% 1.99% Ratio of net investment income (loss) to average net assets (0.83%) (0.97%) (0.54%) (0.32%) 0.01% Portfolio turnover rate 33% 31% 28% 18% 39% Expense ratio before reimbursement by adviser 2.22% 2.27% 2.13% 2.10% 2.15%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 24 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Growth & Income Fund ------------------------------------------------------ Class C ------------------------------------------------------ Year Year Year ended Year ended Year ended ended ended 10/31/01** 10/31/00** 10/31/99** 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $26.49 $28.39 $24.10 $21.75 $17.56 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.18) (0.27) (0.15) (0.07) 0.01 Net realized and unrealized gain/(loss) on investments and foreign currency (5.40) 0.80 5.40 4.12 5.25 ------------------------------------------------------ Total from investment operations (5.58) 0.53 5.25 4.05 5.26 ------------------------------------------------------ Distributions Dividends from net investment income - - - - (0.03) Distributions from realized capital gains (2.66) (2.43) (0.96) (1.70) (1.04) ------------------------------------------------------ Total distributions (2.66) (2.43) (0.96) (1.70) (1.07) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $18.25 $26.49 $28.39 $24.10 $21.75 - --------------------------------------------------------------------------------- Total Return (22.73%) 1.74% 22.28% 20.00% 31.37% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $92,953 $170,277 $156,056 $122,395 $98,250 Ratio of total expenses to average net assets 2.11% 2.10% 1.99% 1.99% 1.99% Ratio of net investment income (loss) to average net assets (0.83%) (0.97%) (0.54%) (0.31%) 0.01% Portfolio turnover rate 33% 31% 28% 18% 39% Expense ratio before reimbursement by adviser 2.22% 2.27% 2.13% 2.10% 2.13%
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Growth & Income Fund ---------------------- Class I ---------------------- 7/10/00* Year ended to 10/31/01** 10/31/00** - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $27.11 $28.25 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) - (0.02) Net realized and unrealized gain/(loss) on investments and foreign currency (5.58) (1.12) ---------------------- Total from investment operations (5.58) (1.14) ---------------------- Distributions Distributions from realized capital gains (2.66) - - -------------------------------------------------------------------------------- Net Asset Value, End of Period $18.87 $27.11 - -------------------------------------------------------------------------------- Total Return (22.16%) (4.04%)+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $43,447 $10,267 Ratio of total expenses to average net assets 1.35% 1.27%# Ratio of net investment income (loss) to average net assets (0.02%) (0.26%)# Portfolio turnover rate 33% 31%+ Expense ratio before reimbursement by adviser 1.44% 1.44%#
* Commencement of operations ** Net investment income per share has been calculated using the average share method + Non-annualized # Annualized The accompanying notes are an integral part of the financial statements. 25 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Large Cap Growth Fund --------------------------------------------------- Class A --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $18.29 $21.44 $17.73 $17.01 $13.78 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.05) (0.21) (0.19) (0.07) (0.03) Net realized and unrealized gain/(loss) on investments and foreign currency (7.69) 1.72 5.05 2.22 3.45 --------------------------------------------------- Total from investment operations (7.74) 1.51 4.86 2.15 3.42 --------------------------------------------------- Distributions Dividends from net investment income - - - - (0.19) Distributions from capital gains (0.14) (4.66) (1.15) (1.43) - --------------------------------------------------- Total distributions (0.14) (4.66) (1.15) (1.43) (0.19) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $10.41 $18.29 $21.44 $17.73 $17.01 - -------------------------------------------------------------------------------- Total Return (42.55%) 5.66% 28.57% 13.85% 25.13% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $5,183 $9,548 $5,656 $3,919 $3,053 Ratio of total expenses to average net assets 1.30% 1.51% 1.65% 1.65% 1.65% Ratio of net investment income (loss) to average net assets (0.41%) (0.93%) (0.94%) (0.43%) (0.17%) Portfolio turnover rate 180% 196% 145% 115% 181% Expense ratio before reimbursement by adviser 2.40% 1.85% 1.90% 1.91% 2.28%
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Large Cap Growth Fund --------------------------------------------------- Class B --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $17.66 $20.96 $17.46 $16.90 $13.73 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.13) (0.34) (0.31) (0.18) (0.13) Net realized and unrealized gain/(loss) on investments and foreign currency (7.42) 1.70 4.96 2.17 3.46 --------------------------------------------------- Total from investment operations (7.55) 1.36 4.65 1.99 3.33 --------------------------------------------------- Distributions Dividends from net investment income - - - - (0.16) --------------------------------------------------- Distributions from capital gains (0.14) (4.66) (1.15) (1.43) - --------------------------------------------------- Total distributions (0.14) (4.66) (1.15) (1.43) (0.16) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $9.97 $17.66 $20.96 $17.46 $16.90 - -------------------------------------------------------------------------------- Total Return (43.00%) 5.01% 27.77% 12.93% 24.50% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $18,139 $34,711 $17,171 $11,659 $9,040 Ratio of total expenses to average net assets 1.96% 2.15% 2.30% 2.30% 2.30% Ratio of net investment income (loss) to average net assets (1.07%) (1.57%) (1.58%) (1.07%) (0.82%) Portfolio turnover rate 180% 196% 145% 115% 181% Expense ratio before reimbursement by adviser 3.07% 2.50% 2.52% 2.56% 2.78%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 26 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Large Cap Growth Fund ------------------------------------------------------ Class C ------------------------------------------------------ Year Year Year ended Year ended Year ended ended ended 10/31/01** 10/31/00** 10/31/99** 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $17.64 $20.93 $17.44 $16.89 $13.73 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.13) (0.35) (0.31) (0.20) (0.13) Net realized and unrealized gain/(loss) on investments and foreign currency (7.40) 1.72 4.95 2.18 3.46 ------------------------------------------------------ Total from investment operations (7.53) 1.37 4.64 1.98 3.33 ------------------------------------------------------ Distributions Dividends from net investment income - - - - (0.17) Distributions from capital gains (0.14) (4.66) (1.15) (1.43) - ------------------------------------------------------ Total distributions (0.14) (4.66) (1.15) (1.43) (0.17) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $9.97 $17.64 $20.93 $17.44 $16.89 - --------------------------------------------------------------------------------- Total Return (42.93%) 5.06% 27.75% 12.87% 24.50% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $7,384 $22,780 $19,463 $12,965 $12,766 Ratio of total expenses to average net assets 1.94% 2.23% 2.30% 2.30% 2.30% Ratio of net investment income (loss) to average net assets (1.05%) (1.64%) (1.58%) (1.06%) (0.82%) Portfolio turnover rate 180% 196% 145% 115% 181% Expense ratio before reimbursement by adviser 3.04% 2.52% 2.52% 2.56% 2.75%
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Large Cap Growth Fund ---------------------- Class I ---------------------- 7/10/00* Year ended to 10/31/01** 10/31/00** - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $18.42 $22.08 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.04) (0.03) Net realized and unrealized gain/(loss) on investments and foreign currency (7.75) (1.93) ---------------------- Total from investment operations (7.79) (1.96) ---------------------- Distributions Distributions from realized capital gains (0.14) (1.70) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $10.49 $18.42 - -------------------------------------------------------------------------------- Total Return (42.52%) (9.04%)+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $15,508 $19,117 Ratio of total expenses to average net assets 1.20% 1.07%# Ratio of net investment income (loss) to average net assets (0.31%) (0.47%)# Portfolio turnover rate 180% 196%+ Expense ratio before reimbursement by adviser 2.31% 1.64%#
* Commencement of operations ** Net investment income per share has been calculated using the average share method + Non-annualized # Annualized The accompanying notes are an integral part of the financial statements. 27 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Mid Cap Growth Fund --------------------------------------------------- Class A --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $17.90 $18.52 $16.09 $15.51 $12.62 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.14) (0.27) (0.21) (0.15) (0.14) Net realized and unrealized gain/(loss) on investments and foreign currency (9.64) 6.33 4.12 0.97 3.03 --------------------------------------------------- Total from investment operations (9.78) 6.06 3.91 0.82 2.89 --------------------------------------------------- Distributions Distributions from realized capital gains - (6.65) (1.48) (0.24) - Return of capital - (0.03) - - - --------------------------------------------------- Total distributions - (6.68) (1.48) (0.24) - - -------------------------------------------------------------------------------- Net Asset Value, End of Period $8.12 $17.90 $18.52 $16.09 $15.51 - -------------------------------------------------------------------------------- Total Return (54.64%) 35.03% 25.50% 5.51% 22.90% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $5,311 $11,718 $5,970 $4,814 $4,170 Ratio of total expenses to average net assets 1.51% 1.59% 1.68% 1.68% 1.68% Ratio of net investment income (loss) to average net assets (1.22%) (1.30%) (1.15%) (0.90%) (1.02%) Portfolio turnover rate 68% 210% 181% 162% 145% Expense ratio before reimbursement by adviser 2.34% 1.88% 1.89% 1.93% 2.24%
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Mid Cap Growth Fund ---------------------------------------------------- Class B ---------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97* - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $17.03 $17.99 $15.77 $15.33 $12.58 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.21) (0.41) (0.32) (0.25) (0.23) Net realized and unrealized gain/(loss) on investments and foreign currency (9.15) 6.13 4.02 0.93 2.98 ---------------------------------------------------- Total from investment operations (9.36) 5.72 3.70 0.68 2.75 ---------------------------------------------------- Distributions Distributions from realized capital gains - (6.65) (1.48) (0.24) - Return of capital - (0.03) - - - ---------------------------------------------------- Total distributions - (6.68) (1.48) (0.24) - - --------------------------------------------------------------------------------- Net Asset Value, End of Period $7.67 $17.03 $17.99 $15.77 $15.33 - --------------------------------------------------------------------------------- Total Return (54.96%) 34.04% 24.62% 4.65% 21.86% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $13,105 $29,978 $17,184 $13,972 $11,802 Ratio of total expenses to average net assets 2.17% 2.31% 2.33% 2.33% 2.33% Ratio of net investment income (loss) to average net assets (1.87%) (2.01%) (1.80%) (1.55%) (1.67%) Portfolio turnover rate 68% 210% 181% 162% 145% Expense ratio before reimbursement by adviser 2.99% 2.54% 2.54% 2.58% 2.79%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 28 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Mid Cap Growth Fund -------------------------------------------------------- Class C -------------------------------------------------------- Year Year ended Year ended Year ended ended Year ended 10/31/01** 10/31/00** 10/31/99** 10/31/98 10/31/97** - ----------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $17.06 $18.02 $15.79 $15.35 $12.59 - ----------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.21) (0.41) (0.32) (0.25) (0.23) Net realized and unrealized gain/(loss) on investments and foreign currency (9.17) 6.13 4.03 0.93 2.99 -------------------------------------------------------- Total from investment operations (9.38) 5.72 3.71 0.68 2.76 -------------------------------------------------------- Distributions Distributions from realized capital gains - (6.65) (1.48) (0.24) - Return of capital - (0.03) - - - -------------------------------------------------------- Total distributions - (6.68) (1.48) (0.24) - - ----------------------------------------------------------------------------------- Net Asset Value, End of Period $7.68 $17.06 $18.02 $15.79 $15.35 - ----------------------------------------------------------------------------------- Total Return (54.98%) 33.95% 24.65% 4.64% 21.92% - ----------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $7,748 $22,913 $18,939 $16,221 $13,471 Ratio of total expenses to average net assets 2.17% 2.33% 2.33% 2.33% 2.33% Ratio of net investment income (loss) to average net assets (1.87%) (2.02%) (1.80%) (1.55%) (1.67%) Portfolio turnover rate 68% 210% 181% 162% 145% Expense ratio before reimbursement by adviser 2.99% 2.54% 2.54% 2.58% 2.78%
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Mid Cap Growth Fund ---------------------- Class I ---------------------- 7/10/00* Year ended to 10/31/01** 10/31/00** - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $17.97 $21.70 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.13) (0.08) Net realized and unrealized gain/(loss) on investments and foreign currency (9.68) (0.15) ---------------------- Total from investment operations (9.81) (0.23) ---------------------- Distributions Distributions from realized capital gains - (3.48) Return of capital - (0.02) ---------------------- Total distributions - (3.50) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $8.16 $17.97 - -------------------------------------------------------------------------------- Total Return (54.59%) (0.85%)+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $6.985 $11,647 Ratio of total expenses to average net assets 1.41% 1.37%# Ratio of net investment income (loss) to average net assets (1.12%) (1.14%)# Portfolio turnover rate 68% 210%+ Expense ratio before reimbursement by adviser 2.24% 1.67%#
* Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 29 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Mid Cap Value Fund/1/ ------------------------------ Class A ------------------------------ Year Year Year ended ended ended 10/31/01* 10/31/00* 10/31/99 - ------------------------------------------------------------------------------ Net Asset Value, Beginning of Period $13.61 $11.98 $10.00 - ------------------------------------------------------------------------------ Investment Operations: Net investment income/(loss) (0.03) - 0.06* Net realized and unrealized gain/(loss) on investments and foreign currency (1.13) 3.87 1.97 ------------------------------ Total from investment operations (1.16) 3.87 2.03 ------------------------------ Distributions Dividends from net investment income - - (0.05) Distributions from realized capital gains (0.07) (2.24) - ------------------------------ Total distributions (0.07) (2.24) (0.05) - ------------------------------------------------------------------------------ Net Asset Value, End of Period $12.38 $13.61 $11.98 - ------------------------------------------------------------------------------ Total Return (8.57%) 35.42% 20.23% - ------------------------------------------------------------------------------ Ratios/Supplemental Data Net assets, end of period (000's) $3,320 $2,747 $1,728 Ratio of total expenses to average net assets 1.78% 1.45% 1.29% Ratio of net investment income (loss) to average net assets (0.25%) (0.04%) 0.51% Portfolio turnover rate 225% 191% 177% Expense ratio before reimbursement by adviser 2.38% 1.95% 2.43%
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Mid Cap Value Fund/1/ ------------------------------ Class B ------------------------------ Year Year Year ended ended ended 10/31/01* 10/31/00* 10/31/99 - ------------------------------------------------------------------------------ Net Asset Value, Beginning of Period $13.31 $11.85 $10.00 - ------------------------------------------------------------------------------ Investment Operations: Net investment income/(loss) (0.12) (0.09) - Net realized and unrealized gain/(loss) on Investments and foreign currency (1.10) 3.79 1.87 ------------------------------ Total from investment operations (1.22) 3.70 1.87 ------------------------------ Distributions Dividends from net investment income - - (0.02) Distributions from realized capital gains (0.07) (2.24) - ------------------------------ Total distributions (0.07) (2.24) (0.02) - ------------------------------------------------------------------------------ Net Asset Value, End of Period $12.02 $13.31 $11.85 - ------------------------------------------------------------------------------ Total Return (9.22%) 34.26% 18.71% - ------------------------------------------------------------------------------ Ratios/Supplemental Data Net assets, end of period (000's) $9,947 $7,471 $4,555 Ratio of total expenses to average net assets 2.43% 2.17% 2.04% Ratio of net investment income (loss) to average net assets (0.90%) (0.75%) (0.26%) Portfolio turnover rate 225% 191% 177% Expense ratio before reimbursement by adviser 3.02% 2.67% 2.77%
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Mid Cap Value Fund, which was reorganized into North American Mid Cap Value Fund on that date. * Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 30 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Mid Cap Value Fund/1/ --------------------------------------------------------- Class C Class I ---------------------- -------------------------------- 7/31/00* Year Year ended to Year ended Year ended ended 10/31/01** 10/31/00** 10/31/01** 10/31/00** 10/31/99 - ------------------------------------------------------------------------------------ Net Asset Value, Beginning of Period $13.26 $12.88 $13.58 $11.95 $10.00 - ------------------------------------------------------------------------------------ Investment Operations: Net investment income/(loss) (0.11) (0.05) (0.02) (0.02) 0.07* Net realized and unrealized gain/(loss) on investments and foreign currency (1.10) 1.23 (1.13) 3.89 1.94 --------------------------------------------------------- Total from investment operations (1.21) 1.18 (1.15) 3.87 2.01 --------------------------------------------------------- Distributions Dividends from net investment income - - - (0.06) Distributions from realized capital gains (0.07) (0.80) (0.07) (2.24) --------------------------------------------------------- Total distributions (0.07) (0.80) (0.07) (2.24) (0.06) - ------------------------------------------------------------------------------------ Net Asset Value, End of Period $11.98 $13.26 $12.36 $13.58 $11.95 - ------------------------------------------------------------------------------------ Total Return (9.18%) 9.53%+ (8.52%) 36.17% 20.18% - ------------------------------------------------------------------------------------ Ratios/Supplemental Data Net assets, end of period (000's) $4,410 $614 $11,936 $11,501 $1,507 Ratio of total expenses to average net assets 2.42% 2.31%# 1.66% 1.49% 1.17% Ratio of net investment income (loss) to average net assets (0.86%) (1.18%)# (0.14%) (0.17%) 0.64% Portfolio turnover rate 225% 191%+ 225% 191% 177% Expense ratio before reimbursement by adviser 3.03% 2.37%# 2.26% 1.78% 2.51%
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Science & Technology Fund/2/ ----------------------------------------------- Class A Class B ---------------------- ---------------------- 3/01/00* 3/01/00* Year ended to Year ended to 10/31/01** 10/31/00** 10/31/01** 10/31/00** - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $8.08 $10.00 $8.03 $10.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.04) (0.04) (0.07) (0.07)* Net realized and unrealized gain/(loss) on investments and foreign currency (4.86) (1.88) (4.82) (1.90) ----------------------------------------------- Total from investment operations (4.90) (1.92) (4.89) (1.97) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $3.18 $8.08 $3.14 $8.03 - --------------------------------------------------------------------------------- Total Return (60.64%) (19.20%)+ (60.90%) (19.70%)+ - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $2,673 $4,623 $9,408 $15,840 Ratio of total expenses to average net assets 1.34% 1.24%# 1.99% 1.91%# Ratio of net investment income (loss) to average net assets (0.89%) (0.64%)# (1.55%) (1.37%)# Portfolio turnover rate 129% 120%+ 129% 120%+ Expense ratio before reimbursement by adviser 3.44% 1.92%# 4.10% 2.59%#
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Mid Cap Value Fund, which was reorganized into North American Mid Cap Value Fund on that date. /2/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Science & Technology Fund, which was reorganized into North American Science & Technology Fund on that date * Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 31 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Science & Technology Fund/1/ ----------------------------------------------- Class C Class I ---------------------- ---------------------- 7/12/00* 3/01/00* Year ended to Year ended to 10/31/01** 10/31/00** 10/31/01** 10/31/00** - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $7.82 $8.48 $8.08 $10.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.07) (0.03) (0.04) (0.03)* Net realized and unrealized gain/(loss) on investments and foreign currency (4.69) (0.63) (4.85) (1.89) ----------------------------------------------- Total from investment operations (4.76) (0.66) (4.89) (1.92) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $3.06 $7.82 $3.19 $8.08 - --------------------------------------------------------------------------------- Total Return (60.87%) (7.78%)+ (60.52%) (19.20%)+ - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $940 $1,065 $821 $539 Ratio of total expenses to average net assets 2.01% 1.71%# 1.28% 1.20%# Ratio of net investment income (loss) to average net assets (1.57%) (1.11%)# (0.85%) (0.48%)# Portfolio turnover rate 129% 120%+ 129% 120%+ Expense ratio before reimbursement by adviser 4.11% 2.37%# 3.38% 1.88%#
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Small Cap Growth Fund -------------------------------------------- Class A -------------------------------------------- 1/06/98* Year ended Year ended Year ended to 10/31/01** 10/31/00** 10/31/99** 10/31/98 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $17.27 $12.81 $8.88 $10.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.14) (0.12) (0.15) (0.08) Net realized and unrealized gain/(loss) on investments and foreign currency (5.65) 5.66 4.08 (1.04) -------------------------------------------- Total from investment operations (5.79) 5.54 3.93 (1.12) -------------------------------------------- Distributions Distributions from capital gains (0.01) (1.08) - - - --------------------------------------------------------------------------------- Net Asset Value, End of Period $11.47 $17.27 $12.81 $8.88 - --------------------------------------------------------------------------------- Total Return (33.56%) 43.62% 44.26% (11.20%)+ - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $4,512 $6,795 $224 $146 Ratio of total expenses to average net assets 1.47% 1.35% 1.70% 1.70%# Ratio of net investment income (loss) to average net assets (1.04%) (0.66%) (1.43%) (1.00%)# Portfolio turnover rate 91% 222% 129% 52%+ Expense ratio before reimbursement by adviser 2.81% 2.10% 6.96% 15.48%#
1 The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Science & Technology Fund, which was reorganized into North American Science & Technology Fund on that date. * Commencement of Operations # Annualized + Non-annualized ** Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 32 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Small Cap Growth Fund -------------------------------------------- Class B -------------------------------------------- 1/06/98* Year ended Year ended Year ended to 10/31/01** 10/31/00** 10/31/99** 10/31/98 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $16.80 $12.57 $8.83 $10.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.22) (0.24) (0.21) (0.12) Net realized and unrealized gain/(loss) on investments and foreign currency (5.46) 5.55 3.95 (1.05) ---------------------------------------------- Total from investment operations (5.68) 5.31 3.74 (1.17) ---------------------------------------------- Distributions Distributions from capital gains (0.01) (1.08) - - - --------------------------------------------------------------------------------- Net Asset Value, End of Period $11.11 $16.80 $12.57 $8.83 - --------------------------------------------------------------------------------- Total Return (33.84%) 42.62% 42.36% (11.70%)+ - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $11,158 $14,554 $660 $263 Ratio of total expenses to average net assets 2.11% 2.00% 2.35% 2.35%# Ratio of net investment income (loss) to average net assets (1.69%) (1.31%) (2.04%) (1.76%)# Portfolio turnover rate 91% 222% 129% 52%+ Expense ratio before reimbursement by adviser 3.46% 2.75% 7.58% 16.48%#
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Small Cap Growth Fund -------------------------------------------- Class C -------------------------------------------- 1/06/98* Year ended Year ended Year ended to 10/31/01** 10/31/00** 10/31/99** 10/31/98 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $16.79 $12.57 $8.84 $10.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.22) (0.29) (0.21) (0.12) Net realized and unrealized gain/(loss) on investments and foreign currency (5.45) 5.59 3.94 (1.04) ---------------------------------------------- Total from investment operations (5.67) 5.30 3.73 (1.16) ---------------------------------------------- Distributions Distributions from capital gains (0.01) (1.08) - - - --------------------------------------------------------------------------------- Net Asset Value, End of Period $11.11 $16.79 $12.57 $8.84 - --------------------------------------------------------------------------------- Total Return (33.80%) 42.54% 42.19% (11.60%)+ - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $2,119 $3,337 $440 $238 Ratio of total expenses to average net assets 2.11% 2.21% 2.35% 2.35%# Ratio of net investment income (loss) to average net assets (1.67%) (1.56%) (2.03%) (1.67%)# Portfolio turnover rate 91% 222% 129% 52%+ Expense ratio before reimbursement by adviser 3.45% 3.17% 7.60% 15.78%#
* Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 33 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Small Cap Growth Fund ---------------------- Class I ---------------------- 7/10/00* Year ended to 10/31/01** 10/31/00** - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $17.33 $19.82 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.13) (0.07) Net realized and unrealized gain/(loss) on investments and foreign currency (5.64) (1.42) ---------------------- Total from investment operations (5.77) (1.49) ---------------------- Distributions Distributions from capital gains (0.01) (1.00) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $11.55 $17.33 - -------------------------------------------------------------------------------- Total Return (33.33%) (7.34%)+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $11,581 $14,154 Ratio of total expenses to average net assets 1.37% 1.11%# Ratio of net investment income (loss) to average net assets (0.94%) (0.37%)# Portfolio turnover rate 91% 222%+ Expense ratio before reimbursement by adviser 2.71% 1.69%#
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Stock Index Fund/1/ -------------------------------- Class A -------------------------------- Year Year ended Year ended ended 10/31/01** 10/31/00** 10/31/99 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.75 $12.32 $10.00 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.09 0.14 0.11 Net realized and unrealized gain/(loss) on investments and foreign currency (3.32) 0.47 2.32 -------------------------------- Total from investment operations (3.23) 0.61 2.43 -------------------------------- Distributions Dividends from net investment income (0.13) (0.10) (0.11) Distributions from realized capital gains - (0.08) - -------------------------------- Total distributions (0.13) (0.18) (0.11) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $9.39 $12.75 $12.32 - -------------------------------------------------------------------------------- Total Return (25.53%) 4.91% 24.36% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $7,639 $8,543 $5,634 Ratio of total expenses to average net assets 0.75% 0.78% 0.82% Ratio of net investment income to average net assets 0.85% 1.12% 1.08% Portfolio turnover rate 3% 2% 14% Expense ratio before reimbursement by adviser 1.85% 1.12% 1.53%
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Stock Index Fund, which was reorganized into North American Stock Index Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 34 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Stock Index Fund/1/ -------------------------------- Class B -------------------------------- Year Year ended Year ended ended 10/31/01** 10/31/00** 10/31/99 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.64 $12.23 $10.00 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.02 0.05 0.02 Net realized and unrealized gain/(loss) on investments and foreign currency (3.29) 0.46 2.23 -------------------------------- Total from investment operations (3.27) 0.51 2.25 -------------------------------- Distributions Dividends from net investment income (0.04) (0.02) (0.02) Distributions from realized capital gains - (0.08) - -------------------------------- Total distributions (0.04) (0.10) (0.02) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $9.33 $12.64 $12.23 - -------------------------------------------------------------------------------- Total Return (25.97%) 4.21% 22.55% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $21,905 $24,966 $15,040 Ratio of total expenses to average net assets 1.38% 1.49% 1.57% Ratio of net investment income to average net assets 0.22% 0.42% 0.37% Portfolio turnover rate 3% 2% 14% Expense ratio before reimbursement by adviser 2.49% 1.83% 1.98%
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Stock Index Fund/1/ ---------------------- Class C ---------------------- 7/17/00* Year ended to 10/31/01** 10/31/00** - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.55 $13.38 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.02 0.01 Net realized and unrealized gain/(loss) on investments and foreign currency (3.26) (0.83) ---------------------- Total from investment operations (3.24) (0.82) ---------------------- Distributions Dividends from net investment income (0.04) (0.01) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $9.27 $12.55 - --------------------------------------------------------------------------------- Total Return (25.92%) (5.21%)+ - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $1,385 $500 Ratio of total expenses to average net assets 1.39% 1.35%# Ratio of net investment income to average net assets 0.15% 0.30%# Portfolio turnover rate 3% 2%+ Expense ratio before reimbursement by adviser 2.49% 1.84%#
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Stock Index Fund, which was reorganized into North American Stock Index Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 35 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Global Equity Fund --------------------------------------------------- Class A --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.06 $16.12 $16.43 $16.32 $14.50 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.08) (0.06) 0.08 0.02 0.06 Net realized and unrealized gain/(loss) on investments and foreign currency (4.13) (2.86) 0.82 1.34 3.45 --------------------------------------------------- Total from investment operations (4.21) (2.92) 0.90 1.36 3.51 --------------------------------------------------- Distributions Dividends from net investment income - - - (0.22) (0.05) Distributions from realized capital gains - (2.14) (1.21) (1.03) (1.64) --------------------------------------------------- Total distributions - (2.14) (1.21) (1.25) (1.69) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $6.85 $11.06 $16.12 $16.43 $16.32 - -------------------------------------------------------------------------------- Total Return (38.07%) (21.08%) 5.60% 8.90% 26.10% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $3,775 $8,610 $12,757 $31,055 $30,960 Ratio of total expenses to average net assets 2.02% 1.86% 1.75% 1.75% 1.75% Ratio of net investment income (loss) to average net assets (0.94%) (0.42%) 0.47% 0.09% 0.33% Portfolio turnover rate 129% 207% 38% 20% 28% Expense ratio before reimbursement by adviser 2.46% 2.06% 1.84% 1.75% 1.81%
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Global Equity Fund --------------------------------------------------- Class B --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.77 $15.83 $16.24 $16.14 $14.36 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.14) (0.14) (0.04) (0.11) (0.05) Net realized and unrealized gain/(loss) on investments and foreign currency (4.00) (2.78) 0.84 1.35 3.47 --------------------------------------------------- Total from investment operations (4.14) (2.92) 0.80 1.24 3.42 --------------------------------------------------- Distributions Dividends from net investment income - - - (0.11) - Distributions from realized capital gains - (2.14) (1.21) (1.03) (1.64) --------------------------------------------------- Total distributions - (2.14) (1.21) (1.14) (1.64) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $6.63 $10.77 $15.83 $16.24 $16.14 - -------------------------------------------------------------------------------- Total Return (38.44%) (21.44%) 5.01% 8.17% 25.63% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $3,121 $10,089 $25,381 $30,287 $31,833 Ratio of total expenses to average net assets 2.70% 2.51% 2.40% 2.40% 2.40% Ratio of net investment income (loss) to average net assets (1.67%) (1.04%) (0.25%) (0.55%) (0.32%) Portfolio turnover rate 129% 207% 38% 20% 28% Expense ratio before reimbursement by adviser 3.13% 2.71% 2.50% 2.40% 2.47%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 36 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Global Equity Fund --------------------------------------------------- Class C --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.82 $15.89 $16.30 $16.19 $14.41 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.14) (0.14) (0.04) (0.10) (0.05) Net realized and unrealized gain/(loss) on investments and foreign currency (4.02) (2.79) 0.84 1.35 3.47 --------------------------------------------------- Total from investment operations (4.16) (2.93) 0.80 1.25 3.42 --------------------------------------------------- Distributions Dividends from net investment income - - - (0.11) - Distributions from realized capital gains - (2.14) (1.21) (1.03) (1.64) --------------------------------------------------- Total distributions - (2.14) (1.21) (1.14) (1.64) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $6.66 $10.82 $15.89 $16.30 $16.19 - -------------------------------------------------------------------------------- Total Return (38.45%) (21.42%) 4.99% 8.21% 25.54% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $7,870 $19,549 $45,201 $57,774 $61,245 Ratio of total expenses to average net assets 2.71% 2.51% 2.40% 2.40% 2.40% Ratio of net investment income (loss) to average net assets (1.66%) (1.05%) (0.24%) (0.56%) (0.32%) Portfolio turnover rate 129% 207% 38% 20% 28% Expense ratio before reimbursement by adviser 3.14% 2.71% 2.50% 2.40% 2.46%
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International Equity Fund ---------------------------------------------------- Class A ---------------------------------------------------- Year Year Year Year Year ended Ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97* - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.49 $11.89 $9.83 $10.81 $11.35 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.03 (0.03) 0.02 0.03 0.06 Net realized and unrealized gain/(loss) on investments and foreign currency (1.91) (0.35) 2.07 0.02 0.35 ---------------------------------------------------- Total from investment operations (1.88) (0.38) 2.09 0.05 0.41 ---------------------------------------------------- Distributions Dividends from net investment income - (0.10) - (0.13) (0.19) Distributions from realized capital gains (1.51) (0.92) (0.03) (0.90) (0.76) ---------------------------------------------------- Total distributions (1.51) (1.02) (0.03) (1.03) (0.95) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $7.10 $10.49 $11.89 $9.83 $10.81 - --------------------------------------------------------------------------------- Total Return (20.69%) (4.00%) 21.33% 0.67% 3.55% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $6,645 $7,471 $3,997 $3,769 $4,461 Ratio of total expenses to average net assets 1.64% 1.71% 1.75% 1.75% 1.75% Ratio of net investment income (loss) to average net assets 0.36% (0.27%) 0.18% 0.44% 0.97% Portfolio turnover rate 38% 126% 142% 173% 146% Expense ratio before reimbursement by adviser 2.61% 2.02% 1.98% 1.87% 1.96%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 37 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
International Equity Fund ---------------------------------------------------- Class B ---------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97* - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.34 $11.74 $9.77 $10.75 $11.30 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.03) (0.11) (0.05) (0.02) 0.03 Net realized and unrealized gain/(loss) on investments and foreign currency (1.89) (0.35) 2.05 0.00 0.31 ---------------------------------------------------- Total from investment operations (1.92) (0.46) 2.00 (0.02) 0.34 ---------------------------------------------------- Distributions Dividends from net investment income - (0.02) - (0.06) (0.13) Distributions from realized capital gains (1.51) (0.92) (0.03) (0.90) (0.76) ---------------------------------------------------- Total distributions (1.51) (0.94) (0.03) (0.96) (0.89) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $6.91 $10.34 $11.74 $9.77 $10.75 - --------------------------------------------------------------------------------- Total Return (21.48%) (4.78%) 20.53% (0.03%) 2.92% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $9,710 $18,204 $14,269 $14,030 $16,334 Ratio of total expenses to average net assets 2.27% 2.38% 2.40% 2.40% 2.40% Ratio of net investment income (loss) to average net assets (0.42%) (0.96%) (0.45%) (0.18%) 0.32% Portfolio turnover rate 38% 126% 142% 173% 146% Expense ratio before reimbursement by adviser 3.24% 2.66% 2.63% 2.52% 2.54%
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International Equity Fund ---------------------------------------------------- Class C ---------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97* - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.31 $11.74 $9.77 $10.76 $11.31 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.03) (0.11) (0.05) (0.02) 0.03 Net realized and unrealized gain/(loss) on investments and foreign currency (1.88) (0.38) 2.05 (0.01) 0.31 ---------------------------------------------------- Total from investment operations (1.91) (0.49) 2.00 (0.03) 0.34 ---------------------------------------------------- Distributions Dividends from net investment income - (0.02) - (0.06) (0.13) Distributions from realized capital gains (1.51) (0.92) (0.03) (0.90) (0.76) ---------------------------------------------------- Total distributions (1.51) (0.94) (0.03) (0.96) (0.89) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $6.89 $10.31 $11.74 $9.77 $10.76 - --------------------------------------------------------------------------------- Total Return (21.43%) (5.05%) 20.53% (0.13%) 2.91% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $2,786 $4,765 $6,680 $7,960 $8,460 Ratio of total expenses to average net assets 2.27% 2.43% 2.40% 2.40% 2.40% Ratio of net investment income (loss) to average net assets (0.40%) (0.96%) (0.49%) (0.19%) 0.32% Portfolio turnover rate 38% 126% 142% 173% 146% Expense ratio before reimbursement by adviser 3.24% 2.68% 2.62% 2.52% 2.57%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 38 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
International Equity Fund ---------------------- Class I ---------------------- 7/10/00* Year ended to 10/31/01** 10/31/00** - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $10.47 $11.74 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.03 (0.01) Net realized and unrealized gain/(loss) on investments and foreign currency (1.92) (1.26) ---------------------- Total from investment operations (1.89) (1.27) ---------------------- Distributions Distributions from realized capital gains (1.51) - - -------------------------------------------------------------------------------- Net Asset Value, End of Period $7.07 $10.47 - -------------------------------------------------------------------------------- Total Return (20.84%) 10.82%+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $18,458 $16,656 Ratio of total expenses to average net assets 1.54% 1.39%# Ratio of net investment income (loss) to average net assets 0.38% (0.19%)# Portfolio turnover rate 38% 126%+ Expense ratio before reimbursement by adviser 2.50% 1.83%#
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International Small Cap Fund ------------------------------------------------------ Class A ------------------------------------------------------ Year Year Year ended Year ended Year ended ended ended 10/31/01** 10/31/00** 10/31/99** 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $19.21 $18.83 $13.91 $13.86 $13.43 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.05) (0.30) (0.14) (0.02) (0.03) Net realized and unrealized gain/(loss) on investments and foreign currency (7.98) 5.35 5.06 0.07 0.46 ------------------------------------------------------ Total from investment operations (8.03) 5.05 4.92 0.05 0.43 ------------------------------------------------------ Distributions Distributions from realized capital gains (1.00) (4.67) - - - - --------------------------------------------------------------------------------- Net Asset Value, End of Period $10.18 $19.21 $18.83 $13.91 $13.86 - --------------------------------------------------------------------------------- Total Return (43.66%) 23.34% 35.37% 0.36% 3.20% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $2,512 $6,003 $2,309 $2,173 $3,225 Ratio of total expenses to average net assets 1.93% 1.97% 1.90% 1.90% 1.90% Ratio of net investment income (loss) to average net assets (0.38%) (1.21%) (0.87%) (0.12%) (0.19%) Portfolio turnover rate 628% 537% 202% 54% 75% Expense ratio before reimbursement by adviser 4.83% 2.21% 2.24% 2.23% 2.46%
* Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 39 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
International Small Cap Fund --------------------------------------------------- Class B --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $18.43 $18.35 $13.66 $13.71 $13.37 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.14) (0.43) (0.27) (0.12) (0.11) Net realized and unrealized gain/(loss) on investments and foreign currency (7.62) 5.18 4.96 0.07 0.45 --------------------------------------------------- Total from investment operations (7.76) 4.75 4.69 (0.05) 0.34 --------------------------------------------------- Distributions Distributions from realized capital gains (1.00) (4.67) - - - - -------------------------------------------------------------------------------- Net Asset Value, End of Period $9.67 $18.43 $18.35 $13.66 $13.71 - -------------------------------------------------------------------------------- Total Return (44.07%) 22.16% 34.33% (0.36%) 2.54% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $5,028 $11,665 $7,417 $7,073 $7,369 Ratio of total expenses to average net assets 2.56% 2.62% 2.55% 2.55% 2.55% Ratio of net investment income (loss) to average net assets (1.04%) (1.87%) (1.53%) (0.79%) (0.84%) Portfolio turnover rate 628% 537% 202% 54% 75% Expense ratio before reimbursement by adviser 5.46% 2.85% 2.89% 2.88% 2.98%
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International Small Cap Fund --------------------------------------------------- Class C --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $18.50 $18.37 $13.66 $13.71 $13.37 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) (0.14) (0.43) (0.31) (0.12) (0.11) Net realized and unrealized gain/(loss) on investments and foreign currency (7.65) 5.23 5.02 0.07 0.45 --------------------------------------------------- Total from investment operations (7.79) 4.80 4.71 (0.05) 0.34 --------------------------------------------------- Distributions Distributions from realized capital gains (1.00) (4.67) - - - - -------------------------------------------------------------------------------- Net Asset Value, End of Period $9.71 $18.50 $18.37 $13.66 $13.71 - -------------------------------------------------------------------------------- Total Return (44.06%) 22.43% 34.48% (0.36%) 2.54% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $3,727 $9,893 $5,972 $6,195 $7,025 Ratio of total expenses to average net assets 2.56% 2.62% 2.55% 2.55% 2.55% Ratio of net investment income (loss) to average net assets (1.06%) (1.84%) (1.53%) (0.78%) (0.84%) Portfolio turnover rate 628% 537% 202% 54% 75% Expense ratio before reimbursement by adviser 5.46% 2.86% 2.89% 2.88% 2.96%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 40 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Balanced Fund --------------------------------------------------- Class A --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.43 $10.56 $11.48 $12.58 $12.33 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.14 0.14 0.24 0.25 0.34 Net realized and unrealized gain/(loss) on investments and foreign currency (2.25) 0.32 (0.09) 1.04 1.52 --------------------------------------------------- Total from investment operations (2.11) 0.46 0.15 1.29 1.86 --------------------------------------------------- Distributions Dividends from net investment income (0.11) (0.28) (0.23) (0.32) (0.45) Distributions from realized capital gains - (1.31) (0.84) (2.07) (1.16) --------------------------------------------------- Total distributions (0.11) (1.59) (1.07) (2.39) (1.61) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $7.21 $9.43 $10.56 $11.48 $12.58 - -------------------------------------------------------------------------------- Total Return (22.57%) 5.67% 1.20% 12.42% 17.01% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $6,626 $7,910 $5,936 $14,415 $12,294 Ratio of total expenses to average net assets 1.64% 1.50% 1.39% 1.39% 1.34% Ratio of net investment income (loss) to average net assets 1.69% 1.54% 2.18% 2.11% 2.74% Portfolio turnover rate 63% 217% 198% 185% 211% Expense ratio before reimbursement by adviser 1.77% 1.76% 1.60% 1.53% 1.59%
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Balanced Fund ---------------------------------------------------- Class B ---------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97* - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.38 $10.49 $11.40 $12.49 $12.26 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.08 0.08 0.18 0.18 0.25 Net realized and unrealized gain/(loss) on investments and foreign currency (2.24) 0.34 (0.10) 1.04 1.53 ---------------------------------------------------- Total from investment operations (2.16) 0.42 0.08 1.22 1.78 ---------------------------------------------------- Distributions Dividends from net investment income (0.05) (0.22) (0.15) (0.24) (0.39) Distributions from realized capital gains - (1.31) (0.84) (2.07) (1.16) ---------------------------------------------------- Total distributions (0.05) (1.53) (0.99) (2.31) (1.55) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $7.17 $9.38 $10.49 $11.40 $12.49 - --------------------------------------------------------------------------------- Total Return (23.10%) 5.17% 0.57% 11.71% 16.27% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $10,560 $15,566 $13,958 $18,929 $17,140 Ratio of total expenses to average net assets 2.29% 2.15% 2.04% 2.04% 1.99% Ratio of net investment income (loss) to average net assets 0.97% 0.87% 1.60% 1.46% 2.09% Portfolio turnover rate 63% 217% 198% 185% 211% Expense ratio before reimbursement by adviser 2.41% 2.41% 2.25% 2.18% 2.23%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 41 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Balanced Fund ------------------------------------------------------ Class C ------------------------------------------------------ Year Year Year ended Year ended Year ended ended ended 10/31/01** 10/31/00** 10/31/99** 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.50 $10.63 $11.54 $12.62 $12.35 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.08 0.08 0.17 0.18 0.25 Net realized and unrealized gain/(loss) on investments and foreign currency (2.27) 0.32 (0.09) 1.05 1.54 ------------------------------------------------------ Total from investment operations (2.19) 0.40 0.08 1.23 1.79 ------------------------------------------------------ Distributions Dividends from net investment income (0.05) (0.22) (0.15) (0.24) (0.36) Distributions from realized capital gains - (1.31) (0.84) (2.07) (1.16) ------------------------------------------------------ Total distributions (0.05) (1.53) (0.99) (2.31) (1.52) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $7.26 $9.50 $10.63 $11.54 $12.62 - --------------------------------------------------------------------------------- Total Return (23.12%) 4.86% 0.58% 11.68% 16.21% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $22,369 $37,282 $53,669 $65,049 $68,261 Ratio of total expenses to average net assets 2.29% 2.15% 2.04% 2.04% 1.99% Ratio of net investment income (loss) to average net assets 0.97% 0.88% 1.55% 1.47% 2.09% Portfolio turnover rate 63% 217% 198% 185% 211% Expense ratio before reimbursement by adviser 2.41% 2.43% 2.25% 2.18% 2.20%
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Balanced Fund ---------------------- Class I ---------------------- 7/10/00* Year ended to 10/31/01** 10/31/00** - ------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.45 $9.34 - ------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.15 0.14 Net realized and unrealized gain/(loss) on investments and foreign currency (2.25) (0.03) ---------------------- Total from investment operations (2.10) 0.11 ---------------------- Distributions Dividends from net investment income (0.12) - - ------------------------------------------------------------------------------- Net Asset Value, End of Period $7.23 9.45 - ------------------------------------------------------------------------------- Total Return (22.45%) 1.07%+ - ------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $4,748 $5,923 Ratio of total expenses to average net assets 1.54% 1.41%# Ratio of net investment income (loss) to average net assets 1.81% 1.47%# Portfolio turnover rate 63% 217%+ Expense ratio before reimbursement by adviser 1.67% 1.54%#
* Commencement of operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 42 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Core Bond Fund --------------------------------------------------- Class A --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.60 $9.85 $10.63 $10.52 $10.34 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.55 0.62 0.66 0.68 0.67 Net realized and unrealized gain/(loss) on investments and foreign currency 0.65 (0.21) (0.77) 0.10 0.18 --------------------------------------------------- Total from investment operations 1.20 0.41 (0.11) 0.78 0.85 --------------------------------------------------- Distributions Dividends from net investment income (0.51) (0.59) (0.67) (0.67) (0.67) Distributions in excess of net investment income - (0.01) - - - Return of capital - (0.06) - - - --------------------------------------------------- Total distributions (0.51) (0.66) (0.67) (0.67) (0.67) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $10.29 $9.60 $9.85 $10.63 $10.52 - -------------------------------------------------------------------------------- Total Return 12.85% 4.35% (1.08%) 7.63% 8.57% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $5,901 $3,858 $3,507 $6,730 $7,110 Ratio of total expenses to average net assets 1.31% 1.29% 1.25% 1.25% 1.25% Ratio of net investment income (loss) to average net assets 5.51% 6.45% 4.77% 6.45% 6.54% Portfolio turnover rate 215% 94% 43% 48% 65% Expense ratio before reimbursement by adviser 1.35% 1.78% 1.70% 1.54% 1.62%
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Core Bond Fund --------------------------------------------------- Class B --------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99* 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.59 $9.85 $10.62 $10.52 $10.33 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.48 0.58 0.59 0.61 0.60 Net realized and unrealized gain/(loss) on investments and foreign currency 0.64 (0.24) (0.75) 0.10 0.20 --------------------------------------------------- Total from investment operations 1.12 0.34 (0.16) 0.71 0.80 --------------------------------------------------- Distributions Dividends from net investment income (0.45) (0.54) (0.61) (0.61) (0.61) Distributions in excess of net investment income - (0.01) - - - Return of capital - (0.05) - - - --------------------------------------------------- Total distributions (0.45) (0.60) (0.61) (0.61) (0.61) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $10.26 $9.59 $9.85 $10.62 $10.52 - -------------------------------------------------------------------------------- Total Return 11.93% 3.70% (1.56%) 6.93% 8.05% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $6,444 $4,937 $4,295 $4,845 $4,613 Ratio of total expenses to average net assets 1.97% 1.95% 1.90% 1.90% 1.90% Ratio of net investment income (loss) to average net assets 4.88% 5.95% 5.71% 5.81% 5.89% Portfolio turnover rate 215% 94% 43% 48% 65% Expense ratio before reimbursement by adviser 2.00% 2.45% 2.39% 2.20% 2.33%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 43 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Core Bond Fund ------------------------------------------------------ Class C ------------------------------------------------------ Year Year Year ended Year ended Year ended ended ended 10/31/01** 10/31/00** 10/31/99** 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.59 $9.85 $10.62 $10.52 $10.33 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.48 0.57 0.59 0.61 0.60 Net realized and unrealized gain/(loss) on investments and foreign currency 0.64 (0.23) (0.75) 0.10 0.20 ------------------------------------------------------ Total from investment operations 1.12 0.34 (0.16) 0.71 0.80 ------------------------------------------------------ Distributions Dividends from net investment income (0.45) (0.54) (0.61) (0.61) (0.61) Distributions in excess of net investment income - (0.01) - - - Return of capital - (0.05) - - - ------------------------------------------------------ Total distributions (0.45) (0.60) (0.61) (0.61) (0.61) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $10.26 $9.59 $9.85 $10.62 $10.52 - --------------------------------------------------------------------------------- Total Return 11.93% 3.70% (1.56%) 6.93% 8.05% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $4,541 $2,778 $4,593 $5,532 $6,109 Ratio of total expenses to average net assets 1.97% 1.95% 1.90% 1.90% 1.90% Ratio of net investment income (loss) to average net assets 4.79% 5.84% 5.70% 5.81% 5.89% Portfolio turnover rate 215% 94% 43% 48% 65% Expense ratio before reimbursement by adviser 2.01% 2.49% 2.38% 2.20% 2.29%
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Core Bond Fund ---------------------------------------------- Class I Class II ---------------------- ---------------------- 7/10/00* 7/10/00* Year ended to Year ended to 10/31/01** 10/31/00** 10/31/01** 10/31/00** - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.62 $9.65 $9.60 $9.64 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.57 0.19 0.59 0.19 Net realized and unrealized gain/(loss) on investments and foreign currency 0.65 (0.02) 0.65 (0.03) --------------------------------------------------- Total from investment operations 1.22 0.17 1.24 0.16 --------------------------------------------------- Distributions Dividends from net investment income (0.52) (0.18) (0.55) (0.18) Return of capital - (0.02) - (0.02) --------------------------------------------------- Total distributions (0.52) (0.20) (0.55) (0.20) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $10.32 $9.62 $10.29 $9.60 - -------------------------------------------------------------------------------- Total Return 13.01% 1.85%+ 13.37% 1.81%+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $22,782 $19,971 $323,570 $317,842 Ratio of total expenses to average net assets 1.22% 1.16%# 0.97% 0.95%# Ratio of net investment income to average net assets 5.68% 6.18%# 5.97% 6.39%# Portfolio turnover rate 215% 94%+ 215% 94%+ Expense ratio before reimbursement by adviser 1.25% 1.16%# 1.00% 0.96%#
* Commencement of operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 44 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
High Yield Bond Fund/1/ ------------------------------ Class A ------------------------------ Year Year Year ended ended ended 10/31/01* 10/31/00* 10/31/99 - ------------------------------------------------------------------------------ Net Asset Value, Beginning of Period $8.56 $9.43 $10.00 - ------------------------------------------------------------------------------ Investment Operations: Net investment income/(loss) 0.78 0.88 0.81 Net realized and unrealized gain/(loss) on Investments and foreign currency (0.96) (0.87) (0.57) ------------------------------ Total from investment operations (0.18) 0.01 0.24 ------------------------------ Distributions Dividends from net investment income (0.82) (0.88) (0.81) - ------------------------------------------------------------------------------ Net Asset Value, End of Period $7.56 $8.56 $9.43 - ------------------------------------------------------------------------------ Total Return (2.23%) 0.04% 2.28% - ------------------------------------------------------------------------------ Ratios/Supplemental Data Net assets, end of period (000's) $722 $286 $34 Ratio of total expenses to average net assets 1.57% 1.38% 1.25% Ratio of net investment income to average net assets 9.73% 10.13% 5.69% Portfolio turnover rate 83% 57% 72% Expense ratio before reimbursement by adviser 1.75% 1.81% 2.01%
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High Yield Bond Fund/1/ ------------------------------ Class B ------------------------------ Year Year Year ended ended ended 10/31/01* 10/31/00* 10/31/99 - ------------------------------------------------------------------------------ Net Asset Value, Beginning of Period $8.55 $9.43 $10.00 - ------------------------------------------------------------------------------ Investment Operations: Net investment income/(loss) 0.73 0.82 0.74 Net realized and unrealized gain/(loss) on investments and foreign currency (0.96) (0.88) (0.57) ------------------------------ Total from investment operations (0.23) (0.06) 0.17 ------------------------------ Distributions Dividends from net investment income (0.77) (0.82) (0.74) - ------------------------------------------------------------------------------ Net Asset Value, End of Period $7.55 $8.55 $9.43 - ------------------------------------------------------------------------------ Total Return (2.84%) (0.83%) 1.53% - ------------------------------------------------------------------------------ Ratios/Supplemental Data Net assets, end of period (000's) $2,911 $1,594 $ 652 Ratio of total expenses to average net assets 2.21% 2.10% 2.00% Ratio of net investment income to average net assets 9.17% 9.41% 7.30% Portfolio turnover rate 83% 57% 72% Expense ratio before reimbursement by adviser 2.39% 2.52% 2.37%
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 High Yield Bond Fund, which was reorganized into North American High Yield Bond Fund on that date. * Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 45 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
High Yield Bond Fund ---------------------- Class C ---------------------- 8/21/00* Year ended to 10/31/01** 10/31/00** - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $8.55 $ 9.00 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.71 0.20 Net realized and unrealized gain/(loss) on investments and foreign currency (0.94) (0.49) ---------------------- Total from investment operations (0.23) (0.29) ---------------------- Distributions Dividends from net investment income (0.77) (0.16) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $7.55 $8.55 - -------------------------------------------------------------------------------- Total Return (2.84%) (3.29%)+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $2,274 $545 Ratio of total expenses to average net assets 2.21% 2.07%# Ratio of net investment income to average net assets 9.02% 9.10%# Portfolio turnover rate 83% 57%+ Expense ratio before reimbursement by adviser 2.39% 2.07%#
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High Yield Bond Fund/1/ -------------------------------- Class I -------------------------------- Year Year ended Year ended ended 10/31/01** 10/31/00** 10/31/99 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $8.56 $9.43 $10.00 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.78 0.93 0.83 Net realized and unrealized gain/(loss) on investments and foreign currency (0.96) (0.90) (0.57) -------------------------------- Total from investment operations (0.18) 0.03 0.26 -------------------------------- Distributions Dividends from net investment income (0.84) (0.90) (0.83) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $7.54 $8.56 $9.43 - -------------------------------------------------------------------------------- Total Return (2.30%) 0.04% 2.44% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $3,062 $14 $14 Ratio of total expenses to average net assets 1.51% 1.22% 1.13% Ratio of net investment income to average net assets 9.80% 10.14% 5.57% Portfolio turnover rate 83% 57% 72% Expense ratio before reimbursement by adviser 1.69% 1.79% 2.05%
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 High Yield Bond Fund, which was reorganized into North American High Yield Bond Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average share method # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 46 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
High Yield Bond Fund/1/ ------------------------------ Class II ------------------------------ Year Year Year ended ended ended 10/31/01* 10/31/00* 10/31/99 - ------------------------------------------------------------------------------ Net Asset Value, Beginning of Period $8.55 $9.43 $10.00 - ------------------------------------------------------------------------------ Investment Operations: Net investment income/(loss) 0.84 0.95 0.86 Net realized and unrealized gain/(loss) on investments and foreign currency (1.01) (0.91) (0.57) ------------------------------ Total from investment operations (0.17) 0.04 0.29 ------------------------------ Distributions Dividends from net investment income (0.85) (0.92) (0.86) - ------------------------------------------------------------------------------ Net Asset Value, End of Period $7.53 $8.55 $9.43 - ------------------------------------------------------------------------------ Total Return (2.07%) 0.30% 2.74% - ------------------------------------------------------------------------------ Ratios/Supplemental Data Net assets, end of period (000's) $61,451 $62,702 $62,506 Ratio of total expenses to average net assets 1.15% 0.96% 0.88% Ratio of net investment income to average net assets 10.45% 10.41% 8.84% Portfolio turnover rate 83% 57% 72% Expense ratio before reimbursement by adviser 1.33% 1.56% 1.35%
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Municipal Bond Fund ------------------------------------------------- Class A ------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00 10/31/99 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.65 $9.48 $10.22 $10.09 $9.73 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.40 0.45 0.45 0.47 0.48 Net realized and unrealized gain/(loss) on investments and foreign currency 0.58 0.18 (0.74) 0.13 0.36 ------------------------------------------------- Total from investment operations 0.98 0.63 (0.29) 0.60 0.84 ------------------------------------------------- Distributions Dividends from net investment income (0.40) (0.46) (0.45) (0.47) (0.48) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $10.23 $9.65 $9.48 $10.22 $10.09 - --------------------------------------------------------------------------------- Total Return 10.29% 6.80% (2.95%) 6.04% 8.85% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $8,363 $7,774 $4,435 $5,820 $6,347 Ratio of total expenses to average net assets 1.03% 1.01% 1.00% 1.00% 0.99% Ratio of net investment income (loss) to average net assets 3.97% 4.74% 4.52% 4.60% 4.87% Portfolio turnover rate 223% 48% 46% 43% 29% Expense ratio before reimbursement by adviser 1.62% 1.61% 1.41% 1.23% 1.23%
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 High Yield Bond Fund, which was reorganized into North American High Yield Bond Fund on that date. * Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 47 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Municipal Bond Fund ------------------------------------------------- Class B ------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00 10/31/99 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.65 $9.48 $10.22 $10.09 $9.73 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.31 0.37 0.37 0.38 0.40 Net realized and unrealized gain/(loss) on investments and foreign currency 0.59 0.18 (0.74) 0.13 0.36 ------------------------------------------------- Total from investment operations 0.90 0.55 (0.37) 0.51 0.76 ------------------------------------------------- Distributions Dividends from net investment income (0.31) (0.38) (0.37) (0.38) (0.40) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $10.24 $9.65 $9.48 $10.22 $10.09 - --------------------------------------------------------------------------------- Total Return 9.47% 5.92% (3.77%) 5.15% 7.94% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $5,788 $6,416 $4,197 $5,273 $6,532 Ratio of total expenses to average net assets 1.88% 1.88% 1.85% 1.85% 1.84% Ratio of net investment income (loss) to average net assets 3.12% 3.89% 3.67% 3.75% 4.02% Portfolio turnover rate 223% 48% 46% 43% 29% Expense ratio before reimbursement by adviser 2.47% 2.47% 2.26% 2.08% 2.15%
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Municipal Bond Fund ------------------------------------------------- Class C ------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00 10/31/99 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.65 $9.48 $10.22 $10.09 $9.73 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.31 0.38 0.37 0.38 0.40 Net realized and unrealized gain/(loss) on investments and foreign currency 0.59 0.17 (0.74) 0.13 0.36 ------------------------------------------------- Total from investment operations 0.90 0.55 (0.37) 0.51 0.76 ------------------------------------------------- Distributions Dividends from net investment income (0.31) (0.38) (0.37) (0.38) (0.40) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $10.24 $9.65 $9.48 $10.22 $10.09 - --------------------------------------------------------------------------------- Total Return 9.47% 5.93% (3.77%) 5.15% 7.94% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $2,242 $2,297 $3,931 $5,147 $5,305 Ratio of total expenses to average net assets 1.90% 1.87% 1.85% 1.85% 1.84% Ratio of net investment income (loss) to average net assets 3.15% 3.97% 3.67% 3.75% 4.02% Portfolio turnover rate 223% 48% 46% 43% 29% Expense ratio before reimbursement by adviser 2.49% 2.53% 2.26% 2.08% 2.15%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 48 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Strategic Income Fund ------------------------------------------------- Class A ------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00 10/31/99 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $7.99 $8.40 $8.99 $9.76 $9.80 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.72 0.72 0.72 0.67 0.70 Net realized and unrealized gain/(loss) on investments and foreign currency (0.22) (0.38) (0.53) (0.63) 0.28 ------------------------------------------------- Total from investment operations 0.50 0.34 0.19 0.04 0.98 ------------------------------------------------- Distributions Dividends from net investment income (0.72) (0.63) (0.73) (0.67) (0.84) Distributions from realized capital gains - - (0.05) (0.14) (0.18) Distributions in excess of net investment income - (0.03) - - - Return of capital - (0.09) - - - ------------------------------------------------- Total distributions (0.72) (0.75) (0.78) (0.81) (1.02) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $7.77 $7.99 $8.40 $8.99 $9.76 - --------------------------------------------------------------------------------- Total Return 6.48% 4.09% 2.10% 0.22% 10.57% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $8,478 $6,439 $8,997 $15,296 $15,924 Ratio of total expenses to average net assets 1.57% 1.55% 1.50% 1.50% 1.50% Ratio of net investment income (loss) to average net assets 9.07% 8.70% 8.21% 7.02% 7.25% Portfolio turnover rate 49% 46% 119% 162% 193% Expense ratio before reimbursement by adviser 1.74% 1.87% 1.67% 1.56% 1.61%
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Strategic Income Fund ------------------------------------------------- Class B ------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00 10/31/99 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $7.99 $8.41 $8.99 $9.76 $9.80 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.67 0.67 0.66 0.61 0.64 Net realized and unrealized gain/(loss) on investments and foreign currency (0.23) (0.39) (0.52) (0.63) 0.28 ------------------------------------------------- Total from investment operations 0.44 0.28 0.14 (0.02) 0.92 ------------------------------------------------- Distributions Dividends from net investment income (0.67) (0.59) (0.67) (0.61) (0.78) Distributions from realized capital gains - - (0.05) (0.14) (0.18) Distributions in excess of net investment income - (0.03) - - - Return of capital - (0.08) - - - ------------------------------------------------- Total distributions (0.67) (0.70) (0.72) (0.75) (0.96) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $7.76 $7.99 $8.41 $8.99 $9.76 - --------------------------------------------------------------------------------- Total Return 5.65% 3.33% 1.56% (0.43%) 9.86% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $9,964 $15,131 $21,340 $29,210 $34,590 Ratio of total expenses to average net assets 2.21% 2.20% 2.15% 2.15% 2.15% Ratio of net investment income (loss) to average net assets 8.41% 8.00% 7.58% 6.39% 6.60% Portfolio turnover rate 49% 46% 119% 162% 193% Expense ratio before reimbursement by adviser 2.39% 2.52% 2.32% 2.21% 2.23%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 49 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Strategic Income Fund -------------------------------------------------- Class C -------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01** 10/31/00 10/31/99 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $7.99 $8.41 $8.99 $9.76 $9.80 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.67 0.67 0.66 0.61 0.64 Net realized and unrealized gain/(loss) on investments and foreign currency (0.23) (0.39) (0.52) (0.63) 0.28 -------------------------------------------------- Total from investment operations 0.44 0.28 0.14 (0.02) 0.92 -------------------------------------------------- Distributions Dividends from net investment income (0.67) (0.59) (0.67) (0.61) (0.78) Distributions from realized capital gains - - (0.05) (0.14) (0.18) Distributions in excess of net investment income - (0.03) - - - Return of capital - (0.08) - - - -------------------------------------------------- Total distributions (0.67) (0.70) (0.72) (0.75) (0.96) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $7.76 $7.99 $8.41 $8.99 $9.76 - -------------------------------------------------------------------------------- Total Return 5.65% 3.32% 1.56% (0.43%) 9.86% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $11,461 $13,056 $20,749 $33,537 $32,683 Ratio of total expenses to average net assets 2.22% 2.20% 2.15% 2.15% 2.15% Ratio of net investment income (loss) to average net assets 8.41% 8.04% 7.57% 6.37% 6.60% Portfolio turnover rate 49% 63% 119% 162% 193% Expense ratio before reimbursement by adviser 2.39% 2.52% 2.32% 2.21% 2.24%
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Strategic Income Fund -------------------------- Class I -------------------------- 7/10/00* Year ended to 10/31/01** 10/31/00 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $8.00 $8.22 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.73 0.20 Net realized and unrealized gain/(loss) on investments and foreign currency (0.22) (0.20) ----------------------------- Total from investment operations 0.51 - ----------------------------- Distributions Dividends from net investment income (0.73) (0.18) Distributions in excess of net investment income - (0.01) Return of capital - (0.03) ----------------------------- Total distributions (0.73) (0.22) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $7.78 $8.00 - -------------------------------------------------------------------------------- Total Return 6.63% (0.10%)+ - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $2,811 $2,636 Ratio of total expenses to average net assets 1.46% 1.45%# Ratio of net investment income (loss) to average net assets 9.17% 7.87%# Portfolio turnover rate 49% 46%+ Expense ratio before reimbursement by adviser 1.64% 1.71%#
* Commencement of Operations # Annualized + Non-annualized ** Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 50 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
U.S. Government Securities Fund -------------------------------------------------- Class A -------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.50 $9.55 $10.08 $9.94 $9.80 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.49 0.55 0.53 0.56 0.59 Net realized and unrealized gain/(loss) on investments and foreign currency 0.79 (0.02) (0.48) 0.16 0.13 -------------------------------------------------- Total from investment operations $1.28 0.53 0.05 0.72 0.72 -------------------------------------------------- Distributions Dividends from net investment income (0.52) (0.54) (0.58) (0.58) (0.58) Return of capital - (0.04) - - - -------------------------------------------------- Total distributions (0.52) (0.58) (0.58) (0.58) (0.58) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $10.26 $9.50 $9.55 $10.08 $9.94 - -------------------------------------------------------------------------------- Total Return 13.89% 5.76% 0.48% 7.41% 7.56% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $35,480 $29,468 $35,495 $49,624 $53,235 Ratio of total expenses to average net assets 1.28% 1.25% 1.25% 1.25% 1.25% Ratio of net investment income (loss) to average net assets 5.03% 5.90% 5.64% 5.65% 6.20% Portfolio turnover rate 114% 193% 63% 116% 364% Expense ratio before reimbursement by adviser 1.54% 1.62% 1.46% 1.40% 1.42%
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U.S. Government Securities Fund -------------------------------------------------- Class B -------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.50 $9.56 $10.07 $9.94 $9.80 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.43 0.49 0.47 0.49 0.54 Net realized and unrealized gain/(loss) on investments and foreign currency 0.80 (0.04) (0.47) 0.15 0.11 -------------------------------------------------- Total from investment operations $1.23 0.45 0.00 0.64 0.65 -------------------------------------------------- Distributions Dividends from net investment income (0.46) (0.48) (0.51) (0.51) (0.51) Return of capital - (0.03) - - - -------------------------------------------------- Total distributions (0.46) (0.51) (0.51) (0.51) (0.51) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $10.27 $9.50 $9.56 $10.07 $9.94 - -------------------------------------------------------------------------------- Total Return 13.30% 4.91% 0.01% 6.60% 6.84% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $11,001 $8,326 $12,072 $17,850 $16,659 Ratio of total expenses to average net assets 1.93% 1.90% 1.90% 1.90% 1.90% Ratio of net investment income (loss) to average net assets 4.39% 5.27% 5.00% 4.99% 5.55% Portfolio turnover rate 114% 193% 63% 116% 364% Expense ratio before reimbursement by adviser 2.20% 2.27% 2.11% 2.05% 2.09%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 51 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
U.S. Government Securities Fund -------------------------------------------------- Class C -------------------------------------------------- Year Year Year Year Year ended ended ended ended ended 10/31/01* 10/31/00* 10/31/99 10/31/98 10/31/97 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $9.50 $9.56 $10.07 $9.94 $9.80 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.43 0.49 0.47 0.49 0.54 Net realized and unrealized gain/(loss) on investments and foreign currency 0.80 (0.04) (0.47) 0.15 0.11 -------------------------------------------------- Total from investment operations $1.23 0.45 0.00 0.64 0.65 -------------------------------------------------- Distributions Dividends from net investment income (0.46) (0.48) (0.51) (0.51) (0.51) Return of capital - (0.03) - - - -------------------------------------------------- Total distributions (0.46) (0.51) (0.51) (0.51) (0.51) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $10.27 $9.50 $9.56 $10.07 $9.94 - -------------------------------------------------------------------------------- Total Return 13.30% 4.91% 0.01% 6.60% 6.84% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $7,399 $6,846 $10,817 $12,708 $14,716 Ratio of total expenses to average net assets 1.94% 1.90% 1.90% 1.90% 1.90% Ratio of net investment income (loss) to average net assets 4.40% 5.27% 5.00% 5.00% 5.55% Portfolio turnover rate 114% 193% 63% 116% 364% Expense ratio before reimbursement by adviser 2.20% 2.28% 2.11% 2.05% 2.09%
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Money Market Fund ------------------------------------------------ Class A ------------------------------------------------ Year Year Year Year Year ended ended ended ended ended 10/31/01 10/31/00 10/31/99 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.04 0.05 0.04 0.05 0.05 Distributions Dividends from net investment income (0.04) (0.05) (0.04) (0.05) (0.05) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Total Return 4.27% 5.57% 4.56% 5.18% 5.13% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $27,256 $25,610 $6,030 $10,295 $11,057 Ratio of total expenses to average net assets 0.77% 0.69% 0.50% 0.50% 0.50% Ratio of net investment income (loss) to average net assets 4.21% 5.72% 4.46% 5.06% 5.02% Expense ratio before reimbursement by adviser 1.14% 0.94% 0.95% 0.92% 0.96%
* Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 52 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Money Market Fund ------------------------------------------------ Class B ------------------------------------------------ Year Year Year Year Year ended ended ended ended ended 10/31/01 10/31/00 10/31/99 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.04 0.05 0.04 0.05 0.05 Distributions Dividends from net investment income (0.04) (0.05) (0.04) (0.05) (0.05) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Total Return 4.27% 5.57% 4.56% 5.18% 5.13% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $11,439 $8,096 $4,551 $5,919 $3,332 Ratio of total expenses to average net assets 0.77% 0.67% 0.50% 0.50% 0.50% Ratio of net investment income (loss) to average net assets 4.11% 5.54% 4.47% 5.02% 5.02% Expense ratio before reimbursement by adviser 1.14% 0.93% 0.99% 0.98% 1.05%
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Money Market Fund ------------------------------------------------ Class C ------------------------------------------------ Year Year Year Year Year ended ended ended ended ended 10/31/01 10/31/00 10/31/99 10/31/98 10/31/97 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.04 0.05 0.04 0.05 0.05 Distributions Dividends from net investment income (0.04) (0.05) (0.04) (0.05) (0.05) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 $1.00 $1.00 $1.00 - --------------------------------------------------------------------------------- Total Return 4.27% 5.57% 4.56% 5.18% 5.13% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $8,568 $7,195 $8,644 $8,237 $7,539 Ratio of total expenses to average net assets 0.77% 0.67% 0.50% 0.50% 0.50% Ratio of net investment income (loss) to average net assets 4.25% 5.37% 4.48% 5.05% 5.01% Expense ratio before reimbursement by adviser 1.14% 1.00% 1.01% 0.94% 1.00%
The accompanying notes are an integral part of the financial statements. 53 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Money Market Fund ------------------ Class I ------------------ Year 7/10/00* ended to 10/31/01 10/31/00 - -------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 - -------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.04 0.02 Distributions Dividends from net investment income (0.04) (0.02) - -------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 - -------------------------------------------------------------------------- Total Return 4.27% 1.84%+ - -------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $7,814 $6,125 Ratio of total expenses to average net assets 0.77% 0.77%# Ratio of net investment income (loss) to average net assets 4.07% 5.88%# Expense ratio before reimbursement by adviser 1.14% 0.80%#
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Municipal Money Market Fund/1/ ---------------------------- Class A ---------------------------- Year Year Year ended ended Ended 10/31/01 10/31/00 10/31/99 - ---------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 - ---------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.02 0.03 0.02 Distributions Dividends from net investment income (0.02) (0.03) (0.02) - ---------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 $1.00 - ---------------------------------------------------------------------------- Total Return 2.39% 3.06% 2.18% - ---------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $3,972 $4,452 $3,651 Ratio of total expenses to average net assets 0.78% 0.97% 1.05% Ratio of net investment income to average net assets 2.39% 3.03% 2.18% Expense ratio before reimbursement by adviser 1.96% 1.44% 1.89%
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Municipal Money Market Fund, which was reorganized into North American Municipal Money Market Fund on that date. * Commencement of Operations # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 54 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
Municipal Money Market Fund/1/ ---------------------------- Class B ---------------------------- Year Year Year ended ended ended 10/31/01 10/31/00 10/31/99 - ---------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 $1.00 - ---------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.02 0.03 0.01 Distributions Dividends from net investment income (0.02) (0.03) (0.01) - ---------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 $1.00 - ---------------------------------------------------------------------------- Total Return 2.39% 2.48% 1.42% - ---------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $2,613 $2,777 $2,841 Ratio of total expenses to average net assets 0.78% 1.54% 1.80% Ratio of net investment income to average net assets 2.38% 2.44% 1.42% Expense ratio before reimbursement by adviser 1.96% 2.00% 2.69%
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Municipal Money Market Fund/1/ ------------------ Class C ------------------ Year 8/10/00* ended to 10/31/01 10/31/00 - ------------------------------------------------------------------------- Net Asset Value, Beginning of Period $1.00 $1.00 - ------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.02 0.01 Distributions Dividends from net investment income (0.02) (0.01) - ------------------------------------------------------------------------- Net Asset Value, End of Period $1.00 $1.00 - ------------------------------------------------------------------------- Total Return 2.40% 0.71%+ - ------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $136 $108 Ratio of total expenses to average net assets 0.78% 0.75%# Ratio of net investment income to average net assets 2.33% 2.78%# Expense ratio before reimbursement by adviser 1.96% 1.16%#
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Municipal Money Market Fund, which was reorganized into North American Municipal Money Market Fund on that date. * Commencement of Operations # Annualized + Non-annualized The accompanying notes are an integral part of the financial statements. 55 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - --------------------------------------------------------------------------------
Aggressive Growth LifeStyle Fund/1/ ---------------------------------------------- Class A ---------------------------------------------- Year ended Year ended Year ended 10/31/01* 10/31/00* 10/31/99 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.71 $11.92 $10.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.51 1.39 0.07 Net realized and unrealized gain/(loss) on investments (3.28) 0.53 1.91 ---------------------------------------------- Total from investment operations (2.77) 1.92 1.98 ---------------------------------------------- Distributions Dividends from net investment income (0.30) (0.98) (0.06) Distributions from realized capital gains (1.62) (0.15) - Distributions in excess of net investment income (0.20) - - ---------------------------------------------- Total distributions (2.12) (1.13) (0.06) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $7.82 $12.71 $11.92 - --------------------------------------------------------------------------------- Total Return (24.89%) 16.27% 19.65% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $3,417 $4,064 $1,929 Ratio of total expenses to average net assets 0.20% 0.12% 0.10% Ratio of net investment income to average net assets 5.62% 10.81% 0.63% Portfolio turnover rate 86% 53% 9% Expense ratio before reimbursement by adviser 0.20% 0.14% 0.10%
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Aggressive Growth LifeStyle Fund/1/ ---------------------------------------------- Class B ---------------------------------------------- Year ended Year ended Year ended 10/31/01* 10/31/00* 10/31/99 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.73 $11.90 $10.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.44 1.46 0.06 Net realized and unrealized gain/(loss) on investments (3.28) 0.48 1.89 ---------------------------------------------- Total from investment operations (2.84) 1.94 1.95 ---------------------------------------------- Distributions Dividends from net investment income (0.27) (0.96) (0.05) Distributions from realized capital gains (1.62) (0.15) - Distributions in excess of net investment income (0.19) - - ---------------------------------------------- Total distributions (2.08) (1.11) (0.05) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $7.81 $12.73 $11.90 - --------------------------------------------------------------------------------- Total Return (25.39%) 16.30% 19.52% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $12,695 $13,450 $4,915 Ratio of total expenses to average net assets 0.85% 0.24% 0.10% Ratio of net investment income to average net assets 4.82% 11.51% 0.66% Portfolio turnover rate 86% 53% 9% Expense ratio before reimbursement by adviser 0.85% 0.41% 0.10%
/1/ The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Aggressive Growth LifeStyle Fund, which was reorganized into North American Aggressive Growth LifeStyle Fund on that date. * Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 56 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
Aggressive Growth LifeStyle Fund/1/ --------------------------------------------------------- Class C Class I ---------------------- -------------------------------- 8/10/00* Year Year ended to Year ended Year ended ended 10/31/01** 10/31/00** 10/31/01** 10/31/00** 10/31/99 - ------------------------------------------------------------------------------------ Net Asset Value, Beginning of Period $12.80 $13.03 $12.73 $11.91 $10.00 - ------------------------------------------------------------------------------------ Investment Operations: Net investment income/(loss) 0.44 0.86 0.46 1.59 0.07* Net realized and unrealized gain/(loss) on investments (3.29) (1.09) (3.23) 0.34 1.90 --------------------------------------------------------- Total from investment operations (2.85) (0.23) (2.77) 1.93 1.97 --------------------------------------------------------- Distributions Dividends from net investment income (0.27) - (0.30) (0.96) (0.06) Distributions from realized capital gains (1.62) - (1.62) (0.15) - Distributions in excess of net investment income (0.19) (0.20) --------------------------------------------------------- Total distributions (2.08) - (2.12) (1.11) (0.06) - ------------------------------------------------------------------------------------ Net Asset Value, End of Period $7.87 $12.80 $7.84 $12.73 $11.91 - ------------------------------------------------------------------------------------ Total Return (25.33%) (1.77%)+ (24.81%) 16.22% 19.71% - ------------------------------------------------------------------------------------ Ratios/Supplemental Data Net assets, end of period (000's) $235 $184 $5,518 $5,004 $1,547 Ratio of total expenses to average net assets 0.85% 0.73%# 0.10% 0.15% 0.10% Ratio of net investment income to average net assets 4.82% 39.30%# 5.12% 12.62% 0.62% Portfolio turnover rate 86% 53%+ 86% 53% 9% Expense ratio before reimbursement by adviser 0.85% 0.89%# 0.10% 0.15% 0.10%
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Moderate Growth LifeStyle Fund/2/ ------------------------------------------ Class A ------------------------------------------ Year Year ended Year ended ended 10/31/01** 10/31/00** 10/31/99 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.07 $11.40 $10.00 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.55 0.99 0.14 Net realized and unrealized gain/(loss) on investments (2.21) 0.50 1.39 ---------------------------------------------- Total from investment operations (1.66) 1.49 1.53 ---------------------------------------------- Distributions Dividends from net investment income (0.38) (0.73) (0.13) Distributions from realized capital gains (1.15) (0.09) - ---------------------------------------------- Total distributions (1.53) (0.82) (0.13) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $8.88 $12.07 $11.40 - -------------------------------------------------------------------------------- Total Return (15.06%) 13.27% 15.20% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $3,876 $3,396 $1,918 Ratio of total expenses to average net assets 0.20% 0.12% 0.10% Ratio of net investment income to average net assets 5.68% 8.27% 1.33% Portfolio turnover rate 79% 47% 11% Expense ratio before reimbursement by adviser 0.20% 0.12% 0.10%
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Aggressive Growth LifeStyle Fund, which was reorganized into North American Aggressive Growth LifeStyle Fund on that date. /2/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Moderate Growth LifeStyle Fund, which was reorganized into North American Moderate Growth LifeStyle Fund on that date. * Commencement of Operations ** Net investment income per share has been calculated using the average share method + Non-annualized # Annualized The accompanying notes are an integral part of the financial statements. 57 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
Moderate Growth LifeStyle Fund/1/ ------------------------------------------ Class B ------------------------------------------ Year Year ended Year ended ended 10/31/01** 10/31/00** 10/31/99 - -------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $12.08 $11.42 $10.00 - -------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.47 1.02 0.12 Net realized and unrealized gain/(loss) on investments (2.19) 0.47 1.41 ------------------------------------------ Total from investment operations (1.72) 1.49 1.53 ------------------------------------------ Distributions Dividends from net investment income (0.34) (0.74) (0.11) Distributions from realized capital gains (1.15) (0.09) - ------------------------------------------ Total distributions (1.49) (0.83) (0.11) - -------------------------------------------------------------------------------- Net Asset Value, End of Period $8.87 $12.08 $11.42 - -------------------------------------------------------------------------------- Total Return (15.56%) 13.22% 15.26% - -------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $13,412 $11,843 $5,553 Ratio of total expenses to average net assets 0.85% 0.23% 0.10% Ratio of net investment income to average net assets 4.83% 8.53% 1.40% Portfolio turnover rate 79% 47% 11% Expense ratio before reimbursement by adviser 0.85% 0.23% 0.10%
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Moderate Growth LifeStyle Fund/1/ --------------------------------------------------------- Class C Class I ---------------------- -------------------------------- 7/12/00* Year Year ended to Year ended Year ended ended 10/31/01** 10/31/00** 10/31/01** 10/31/00** 10/31/99 - ------------------------------------------------------------------------------------ Net Asset Value, Beginning of Period $12.11 $12.77 $12.06 $11.39 $10.00 - ------------------------------------------------------------------------------------ Investment Operations: Net investment income/(loss) 0.28 0.73 0.47 1.16 0.15 Net realized and unrealized gain/(loss) on investments (2.02) (1.03) (2.12) 0.32 1.38 --------------------------------------------------------- Total from investment operations (1.74) (0.30) (1.65) 1.48 1.53 --------------------------------------------------------- Distributions Dividends from net investment income (0.34) (0.36) (0.38) (0.72) (0.14) Distributions from realized capital gains (1.15) - (1.15) (0.09) - --------------------------------------------------------- Total distributions (1.49) (0.36) (1.53) (0.81) (0.14) - ------------------------------------------------------------------------------------ Net Asset Value, End of Period $8.88 $12.11 $8.88 $12.06 $11.39 - ------------------------------------------------------------------------------------ Total Return (15.69%) (2.30%)+ (14.97%) 13.10% 15.35% - ------------------------------------------------------------------------------------ Ratios/Supplemental Data Net assets, end of period (000's) $738 $183 $8,707 $5,439 $1,537 Ratio of total expenses to average net assets 0.85% 0.80%# 0.10% 0.15% 0.10% Ratio of net investment income to average net assets 2.96% 19.82%# 4.90% 9.91% 1.42% Portfolio turnover rate 79% 47%+ 79% 47% 11% Expense ratio before reimbursement by adviser 0.85% 0.80%# 0.10% 0.15% 0.10%
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Moderate Growth LifeStyle Fund, which was reorganized into North American Moderate Growth LifeStyle Fund on that date. * Commencement of operations ** Net investment income per share has been calculated using the average share method + Non-annualized # Annualized The accompanying notes are an integral part of the financial statements. 58 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
Conservative Growth LifeStyle Fund/1/ ---------------------------------------------- Class A ---------------------------------------------- Year ended Year ended Year ended 10/31/01* 10/31/00* 10/31/99 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.59 $11.03 $10.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.55 0.87 0.21 Net realized and unrealized gain/(loss) on investments (1.40) 0.39 1.02 ---------------------------------------------- Total from investment operations (0.85) 1.26 1.23 ---------------------------------------------- Distributions Dividends from net investment income (0.37) (0.60) (0.20) Distributions from realized capital gains (0.99) (0.10) - ---------------------------------------------- Total distributions (1.36) (0.70) (0.20) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $9.38 $11.59 $11.03 - --------------------------------------------------------------------------------- Total Return (7.91%) 11.61% 12.30% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $3,459 $3,420 $1,790 Ratio of total expenses to average net assets 0.20% 0.12% 0.10% Ratio of net investment income to average net assets 5.63% 7.62% 2.01% Portfolio turnover rate 85% 45% 10% Expense ratio before reimbursement by adviser 0.20% 0.12% 0.10%
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Conservative Growth LifeStyle Fund/1/ ---------------------------------------------- Class B ---------------------------------------------- Year ended Year ended Year ended 10/31/01* 10/31/00* 10/31/99 - --------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $ 11.63 $ 11.06 $ 10.00 - --------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.50 0.81 0.18 Net realized and unrealized gain/(loss) on investments (1.43) 0.45 1.05 ---------------------------------------------- Total from investment operations (0.93) 1.26 1.23 ---------------------------------------------- Distributions Dividends from net investment income (0.33) (0.59) (0.17) Distributions from realized capital gains (0.99) (0.10) - ---------------------------------------------- Total distributions (1.32) (0.69) (0.17) - --------------------------------------------------------------------------------- Net Asset Value, End of Period $ 9.38 $ 11.63 $ 11.06 - --------------------------------------------------------------------------------- Total Return (8.60%) 11.66% 12.21% - --------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $ 9,908 $ 10,354 $ 5,880 Ratio of total expenses to average net assets 0.85% 0.23% 0.10% Ratio of net investment income to average net assets 5.08% 7.15% 2.11% Portfolio turnover rate 85% 45% 10% Expense ratio before reimbursement by adviser 0.85% 0.23% 0.10%
/1/The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Conservative Growth LifeStyle Fund, which was reorganized into North American Conservative Growth LifeStyle Fund on that date. * Net investment income per share has been calculated using the average share method The accompanying notes are an integral part of the financial statements. 59 NORTH AMERICAN FUNDS FINANCIAL HIGHLIGHTS (For a Share Outstanding Throughout the Period) - -------------------------------------------------------------------------------
Conservative Growth LifeStyle Fund/1/ -------------------------------------------------------- Class C Class I ---------------------- -------------------------------- 7/20/00* Year Year ended to Year ended Year ended ended 10/31/01** 10/31/00** 10/31/01** 10/31/00** 10/31/99 - ----------------------------------------------------------------------------------- Net Asset Value, Beginning of Period $11.69 $11.95 $11.59 $11.03 $10.00 - ----------------------------------------------------------------------------------- Investment Operations: Net investment income/(loss) 0.34 0.74 0.54 0.91 0.21* Net realized and unrealized gain/(loss) on investments (1.31) (0.73) (1.38) 0.33 1.02 -------------------------------------------------------- Total from investment operations (0.97) 0.01 (0.84) 1.24 1.23 -------------------------------------------------------- Distributions Dividends from net investment income (0.33) (0.27) (0.37) (0.58) (0.20) Distributions from realized capital gains (0.99) - (0.99) (0.10) - -------------------------------------------------------- Total distributions (1.32) (0.27) (1.36) (0.68) (0.20) - ----------------------------------------------------------------------------------- Net Asset Value, End of Period $9.40 $11.69 $9.39 $11.59 $11.03 - ----------------------------------------------------------------------------------- Total Return (8.93%) 0.06%+ (7.80%) 11.54% 12.24% - ----------------------------------------------------------------------------------- Ratios/Supplemental Data Net assets, end of period (000's) $642 $150 $5,409 $4,484 $1,508 Ratio of total expenses to average net assets 0.85% 0.86%# 0.10% 0.15% 0.10% Ratio of net investment income to average net assets 3.43% 22.43%# 5.46% 8.15% 2.01% Portfolio turnover rate 85% 45%+ 85% 45% 10% Expense ratio before reimbursement by adviser 0.85% 0.86%# 0.10% 0.15% 0.10%
/1/ The financial information for the fiscal periods prior to July 7, 2000 reflect the financial information for the AGSPC2 Conservative Growth LifeStyle Fund, which was reorganized into North American Conservative Growth LifeStyle Fund on that date. * Commencement of operations ** Net investment income per share has been calculated using the average share method + Non-annualized # Annualized The accompanying notes are an integral part of the financial statements. 60 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 (showing percentage of total value of investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Growth & Income Fund - --------------------------------------------------------------------------------
Shares Value ------ ----- COMMON STOCKS - 99.69% Aerospace & Defense - 1.13% Boeing Co. 42,200 $1,375,720 United Technologies Corp. 23,100 1,244,859 ------------ 2,620,579 Banks - 4.24% Bank One Corp. 93,900 3,116,541 U.S. Bancorp 179,193 3,186,052 Wells Fargo & Co. 88,200 3,483,900 ------------ 9,786,493 Beverages - 3.68% Coca Cola Co. 84,500 4,045,860 Pepsico, Inc. 91,200 4,442,352 ------------ 8,488,212 Chemicals - 1.14% Dow Chemical Co. 79,300 2,636,725 ------------ Commercial Services & Supplies - 2.02% Automatic Data Processing, Inc. 72,800 3,760,848 Waste Management, Inc. 36,800 901,600 ------------ 4,662,448 Communications Equipment - 3.19% Cisco Systems, Inc.* 268,000 4,534,560 Motorola, Inc. 171,600 2,809,092 ------------ 7,343,652 Computers & Business Equipment - 2.62% International Business Machines Corp. 55,900 6,041,113 ------------ Computers & Peripherals - 2.17% Dell Computer Corp.* 96,200 2,306,876 EMC Corp.* 113,200 1,394,624 Hewlett-Packard Company 77,200 1,299,276 ------------ 5,000,776 Electric Utilities - 2.37% Exelon Corp. 40,775 1,715,404 FPL Group, Inc. 70,600 3,748,860 ------------ 5,464,264 Electrical Equipment - 0.85% Emerson Electric Co. 40,000 1,960,800 ------------ Electronic Components - 2.44% Intel Corp. 154,400 3,770,448 Texas Instruments, Inc. 66,200 1,852,938 ------------ 5,623,386 Electronic Equipment - 0.85% Solectron Corp.* 159,200 1,958,160 ------------ Financial Services - 8.05% Citigroup, Inc. 188,115 8,562,995 Goldman Sachs Group, Inc. 37,300 2,915,368 JP Morgan Chase & Co. 93,350 3,300,856 Financial Services - continued Merrill Lynch & Co., Inc. 86,300 $3,772,173 ------------ 18,551,392 Health Care Providers & Services - 1.05% HCA Healthcare Corp. 61,300 2,431,158 ------------ Hotels & Restaurants - 1.06% McDonald's Corp. 93,300 2,432,331 ------------ Household Products - 2.91% Kimberly Clark Corp. 61,850 3,433,294 Procter & Gamble Co. 44,300 3,268,454 ------------ 6,701,748 Industrial Components - 0.37% Illinois Tool Works, Inc. 14,800 846,560 ------------ Insurance - 5.18% American International Group, Inc.a 78,825 6,195,645 Marsh & McLennan Companies, Inc. 59,500 5,756,625 ------------ 11,952,270 Internet Services - 0.69% VeriSign, Inc.* 24,655 954,395 Accenture, Ltd.* 35,900 630,763 ------------ 1,585,158 Media - 4.96% AOL Time Warner, Inc.* 134,100 4,185,261 Clear Channel Communications* 33,800 1,288,456 Gannett, Inc. 62,000 3,918,400 Liberty Media Corp.* 175,100 2,046,919 ------------ 11,439,036 Metals & Mining - 1.39% Alcoa, Inc. 99,100 3,197,957 ------------ Multi Industry - 5.41% General Electric Co. 237,700 8,654,657 Tyco International, Ltd. 77,700 3,818,178 ------------ 12,472,835 Oil & Gas - 7.98% ChevronTexaco Corp. 35,800 3,170,090 El Paso Energy Corp. 62,600 3,071,156 ExxonMobil Corp. 240,868 9,502,243 Royal Dutch Petroleum Co. 52,500 2,651,775 ------------ 18,395,264 Personal Products - 0.55% Gillette Co. 40,900 1,271,581 ------------ Petroleum Services - 1.35% Schlumberger, Ltd. 64,200 3,108,564 ------------ Pharmaceuticals - 15.36% Abbott Laboratories 94,600 5,011,908 American Home Products Corp. 88,200 4,924,206 Bristol-Myers Squibb Co. 65,900 3,522,355 Johnson & Johnson 86,900 5,032,379
The accompanying notes are an integral part of the financial statements. 61 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Pharmaceuticals - continued Merck & Company, Inc. 68,400 $4,364,604 Pfizer, Inc. 143,450 6,010,555 Pharmacia Corp. 103,289 4,185,270 Schering Plough Corp. 63,700 2,368,366 ------------ 35,419,643 Retail Trade - 6.55% CVS Corporation 66,200 1,582,180 Home Depot, Inc. 98,000 3,746,540 Safeway, Inc.* 39,500 1,645,175 Wal-Mart Stores, Inc. 158,000 8,121,200 ------------ 15,095,095 Software - 4.99% Microsoft Corp.* 170,900 9,937,835 Oracle Corp.* 115,200 1,562,112 ------------ 11,499,947 Telecommunications - 5.14% Qwest Communications Int'l, Inc. 60,100 778,295 SBC Communications, Inc. 87,944 3,351,546 Verizon Communications 79,454 3,957,604 Worldcom, Inc.* 279,900 3,764,655 ------------ 11,852,100 TOTAL COMMON STOCKS (Cost $226,263,287) $229,839,246 ------------ Principal Value --------- ----- REPURCHASE AGREEMENTS - 0.31% Repurchase Agreement with State Street Bank & Trust Co., dated 10/31/01 at 2.52%, to be repurchased at $708,049 on 11/01/01, collateralized by U.S. Government Securities (Cost $708,000) $708,000 $708,000 ------------ TOTAL INVESTMENTS (Growth & Income Fund) (Cost $226,971,287) $230,547,246 ------------ - ---------------------------------------------------------------------------- Large Cap Growth Fund - ---------------------------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 97.10% Aerospace & Defense - 2.10% General Dynamics Corp. 5,425 $442,680 Honeywell International, Inc. 6,825 201,679 United Technologies Corp. 5,900 317,951 ------------ 962,310 Automotive - 0.65% Harley Davidson, Inc. 6,556 296,725 ------------ Banking - 3.02% Bank America Corp. 3,950 233,011 Fifth Third Bancorp 9,106 513,760 Northern Trust Corp. 6,975 352,168 Washington Mutual, Inc. 9,375 283,031 ------------ 1,381,970 Beverages - 2.83% The Coca-Cola Company 6,950 $332,766 Pepsico, Inc. 19,775 963,240 ------------ 1,296,006 Biotechnology - 3.91% Amgen, Inc.* 9,711 551,779 Biogen, Inc.* 7,625 419,375 Genentech, Inc.* 8,950 467,637 Immunex Corp.* 8,600 205,454 Shire Pharmaceuticals Group* 3,300 147,510 ------------ 1,791,755 Building Materials - 0.22% Masco Corp. 5,175 102,620 ------------ Commercial Services & Supplies - 2.33% Automatic Data Proc. 5,400 278,964 Block, H & R, Inc. 6,025 205,332 Cintas Corp. 3,000 121,260 Concord EFS, Inc.* 12,250 335,282 Devry, Inc.* 4,682 126,180 ------------ 1,067,018 Communications Equipment - 6.45% Brocade Communications Systems, Inc.* 5,050 123,978 Ciena Corp.* 19,900 323,574 Cisco Systems, Inc.* 66,968 1,133,099 Juniper Networks, Inc.* 9,900 220,671 Nokia Oyj 33,925 695,802 Qualcomm, Inc.* 9,375 460,500 ------------ 2,957,624 Computers - 2.99% Dell Computer Corp.* 22,700 544,346 International Business Machines Corp. 7,625 824,034 ------------ 1,368,380 Diversified Financial - 8.17% American Express Co. 14,850 437,035 Citigroup, Inc. 22,732 1,034,761 Federal Home Loan Mortgage Corp. 3,650 247,543 Federal National Mortgage Assn. 3,000 242,880 Franklin Resources, Inc. 10,675 342,667 Goldman Sachs Group, Inc. 3,050 238,388 Household International, Inc. 6,525 341,258 JP Morgan Chase & Co. 6,600 233,376 MBNA Corp. 14,700 405,867 Merrill Lynch & Co., Inc. 2,125 92,884 State Street Corporation 2,825 128,651 ------------ 3,745,310 Electronic Equipment - 1.48% Celestica, Inc.* 10,325 354,354 Solectron Corp.* 26,475 325,642 ------------ 679,996 Food & Drug Retailing - 1.33% Safeway, Inc.* 9,075 377,974 Walgreen Co. 7,225 233,946 ------------ 611,920
The accompanying notes are an integral part of the financial statements. 62 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Gas Utilities - 0.31% El Paso Corp. 2,876 $141,097 ------------ Health Care Equipment & Supplies - 5.25% Applera Corp. 3,189 93,055 Baxter Int'l., Inc. 6,050 292,638 Beckton Dickinson & Co. 6,725 240,755 Boston Scientific Corp.* 7,950 180,783 Medtronic, Inc. 4,725 190,418 Tenet Healthcare Corp.* 11,575 665,794 United Health Group, Inc. 11,275 741,331 ------------ 2,404,774 Household Products - 1.27% Colgate Palmolive Co. 5,600 322,112 Kimberly Clark Co. 4,700 260,897 ------------ 583,009 Industrial Conglomerates - 5.13% General Electric Co. 37,839 1,377,718 Tyco Int'l, Ltd. 19,768 971,400 ------------ 2,349,118 Insurance - 5.67% American Int'l. Group, Inc.a 11,250 884,250 Berkshire Hathaway, Inc.* 550 1,294,700 Marsh & McLennan Cos., Inc. 3,075 297,506 St. Paul Companies, Inc. 2,675 122,782 ------------ 2,599,238 Internet Software & Services - 0.96% Checkpoint Software* 11,675 344,646 Verisign, Inc.* 2,475 95,807 ------------ 440,453 IT Consulting & Services - 0.63% Computer Sciences Corp.* 75 2,693 Electronic Data Systems Corp. 4,450 286,446 ------------ 289,139 Leisure Equipment & Products - 0.39% Mattel, Inc.* 9,425 178,415 ------------ Media - 5.74% AOL Time Warner, Inc.* 28,747 897,194 Clear Channel Communications* 5,650 215,378 Comcast Corp.* 9,200 329,728 Disney, Walt Co. 16,675 309,988 Gannett, Inc. 2,500 158,000 Liberty Media Corp.* 25,050 292,834 Omnicom Group 1,825 140,124 Viacom, Inc.* 7,900 288,429 ------------ 2,631,675 Metals & Mining - 0.28% Alcoa, Inc. 3,975 128,273 ------------ Personal Products - 0.64% Gillette Co. 9,425 293,023 ------------
Shares Value ------ ----- Pharmaceuticals - 9.24% Abbott Labs 7,175 $380,132 American Home Products Corp. 10,175 568,070 Bristol Myers Squibb Co. 12,475 666,789 Johnson & Johnson 12,175 705,054 Merck & Co., Inc. 3,500 223,335 Pfizer, Inc. 32,315 1,353,998 Pharmacia Corp. 8,350 338,342 ------------ 4,235,720 Retail Trade - 5.92% Costco Wholesale Corp.* 10,125 383,029 Home Depot, Inc. 16,144 617,185 Kohl's Corp.* 6,056 336,774 Lowe's Cos., Inc. 4,575 156,008 Wal-Mart Stores, Inc. 23,700 1,218,180 ------------ 2,711,176 Semiconductor Equipment & Products - 9.17% Analog Devices, Inc.* 5,850 222,300 Applied Materials, Inc.* 3,600 122,796 Flextronics International* 16,400 326,360 Intel Corp. 48,104 1,174,700 KLA Tencor Corp.* 3,600 147,096 Linear Technology Corp. 12,425 482,090 Maxim Integrated Products, Inc.* 5,525 252,769 Novellus Systems, Inc.* 3,800 125,514 STMicroelectronics NV 8,925 249,632 Texas Instruments, Inc. 22,625 633,274 Xilinx, Inc.* 15,250 463,905 ------------ 4,200,436 Software - 8.09% Adobe Systems, Inc. 3,075 81,180 BEA Systems, Inc.* 8,900 108,046 Mercury Interactive Corp.* 9,050 215,571 Microsoft Corp.* 22,550 1,311,283 Momentum Business Applications* 22 407 Oracle Corp.* 48,125 652,575 Peoplesoft, Inc.* 16,925 503,857 Siebel Systems, Inc.* 19,225 313,944 Veritas Software Corp. 18,393 521,993 ------------ 3,708,856 Textiles & Apparel - 0.43% Nike, Inc. 3,975 196,206 ------------ Tobacco - 2.08% Philip Morris Cos., Inc. 20,350 952,380 ------------ Wireless Telecommunication Services - 0.42% Sprint Corp.* 8,600 191,780 ------------ TOTAL COMMON STOCKS (Cost $49,656,192) $44,496,402 ------------
The accompanying notes are an integral part of the financial statements. 63 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- SHORT TERM INVESTMENTS - 0.00% SSgA Money Market Fund (Cost $1,000) 1,000 $1,000 ------------ Principal Value --------- ----- SHORT TERM COMMERCIAL PAPER - 2.90% Ciesco, L.P., 2.60% due 11/01/01 (Cost $1,330,000) $1,330,000 $1,330,000 ------------ TOTAL INVESTMENTS (Large Cap Growth Fund) (Cost $50,987,192) $45,827,402 ------------ - ------------------------------------------------------------ Mid Cap Growth Fund - ------------------------------------------------------------ Shares Value ------ ----- COMMON STOCKS - 100.00% Aerospace & Defense - 0.58% General Dynamics Corp. 1,600 $130,560 Northrop Grumman Corp. 600 59,970 ------------ 190,530 Automobiles - 0.80% Harley Davidson, Inc. 5,800 262,508 ------------ Banks - 3.25% Banknorth Group, Inc. 8,200 179,826 Golden West Financial Corp. 3,800 184,680 National Commercial Financial Corp. 2,400 54,600 Northern Trust Corp. 7,300 368,577 Synovus Financial Corp. 9,200 211,784 TCF Financial Corp. 1,700 71,400 ------------ 1,070,867 Biotechnology - 3.68% Genzyme Corp.* 8,400 453,180 Gilead Sciences, Inc.* 3,100 194,990 Idec Pharmaceuticals Corp.* 2,700 161,946 Medimmune, Inc.* 4,100 160,884 Shire Pharmaceuticals Group* 5,400 241,380 ------------ 1,212,380 Business Services - 3.15% Apollo Group, Inc.* 4,500 182,925 Bisys Group, Inc.* 4,700 244,494 Paychex, Inc. 10,325 331,020 Robert Half International, Inc.* 13,600 280,568 ------------ 1,039,007 Communications Equipment - 5.62% Brocade Communications Syst., Inc.* 16,800 412,440 Ciena Corp.* 4,100 66,666 Comverse Technology, Inc.* 13,200 248,292 Extreme Networks, Inc.* 21,300 248,997 Finisar, Inc.* 16,200 126,684 Foundry Networks, Inc.* 11,700 114,192 JDS Uniphase Corp.* 16,100 128,639 Juniper Networks, Inc.* 4,200 93,618
Shares Value ------ ----- Communications Equipment - continued L3 Communications Holdings Corp.* 300 $26,061 McData Corp. - Class A* 6,500 95,615 McData Corp. - Class B* 7,400 115,958 Oni Sys Corp.* 15,500 75,795 Riverstone Networks, Inc.* 3,000 38,160 Sonus Networks, Inc.* 14,300 60,203 ------------ 1,851,320 Construction & Engineering - 0.42% Fluor Corp.* 3,700 137,714 ------------ Electronic Equipment & Instruments - 5.78% Analog Devices, Inc.* 9,000 342,000 Applied Micro Circuits Corp.* 30,900 340,827 AVX Corp. 3,700 68,487 Celestica, Inc.* 6,800 233,376 Dynegy, Inc. 6,100 218,990 Flextronics International, Ltd.* 13,100 260,690 Molex, Inc. 6,600 190,938 Power One, Inc.* 21,000 166,110 Sanmina Corp.* 5,600 84,784 ------------ 1,906,202 Energy Equipment & Services - 2.84% BJ Services Company* 8,700 222,633 Cooper Cameron Corp.* 7,050 274,950 Nabors Industries, Inc.* 3,500 107,590 Smith International, Inc.* 6,950 328,735 ------------ 933,908 Financial Services - 7.54% Americredit Corp.* 2,500 38,750 Bear Stearns Companies, Inc. 6,300 340,200 Edwards, A.G., Inc. 9,400 371,676 Federated Investors, Inc. 3,900 101,790 Investment Technology Group* 1,900 122,379 Legg Mason, Inc. 8,600 362,146 Lehman Brothers Holdings, Inc. 5,320 332,287 Nationwide Financial Services, Inc. 6,000 204,120 Sei Investments Co. 3,700 113,775 T. Rowe Price & Associates, Inc. 4,300 119,368 USA Ed, Inc. 3,300 269,148 Waddell & Reed Financial, Inc. 4,271 108,868 ------------ 2,484,507 Healthcare Equipment & Supplies - 3.54% Allergan, Inc. 3,250 233,318 Guidant Corp.* 8,400 348,684 ST Jude Medical, Inc.* 5,200 369,200 Varian Medical Systems, Inc.* 3,200 214,720 ------------ 1,165,922 Healthcare Providers & Services - 3.18% Amerisource Health Corp.* 5,815 369,601 First Health Group Corp.* 9,400 253,800 Laboratory Corp of America Holdings* 4,900 422,380 ------------ 1,045,781
The accompanying notes are an integral part of the financial statements. 64 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Hotels, Restaurants & Leisure - 2.50% Harrah's Entertainment, Inc.* 20,450 $595,709 MGM Mirage, Inc.* 10,150 226,345 --------- 822,054 Insurance - 2.52% Ambac Financial Group, Inc. 2,850 136,800 John Hancock Financial Services 9,100 310,128 Sun Life Financial Services, Inc. (CAD) 9,800 203,154 Sun Life Financial Services, Inc. 8,700 180,875 --------- 830,957 Internet Software & Services - 5.32% Check Point Software* 14,100 416,232 Earthlink, Inc.* 12,300 180,195 Ebay, Inc.* 9,900 519,552 Expedia, Inc.* 2,900 85,289 Homestore.com, Inc.* 2,900 14,906 Openwave Systems, Inc.* 11,990 92,683 Verisign, Inc.* 6,800 263,228 Webmethods, Inc.* 19,600 180,124 --------- 1,752,209 IT Consulting & Services - 1.14% KPMG Consulting* 27,300 336,336 Sungard Data Systems, Inc.* 1,500 37,800 --------- 374,136 Machinery - 0.54% Illinois Tool Works, Inc. 3,100 177,320 --------- Media - 8.12% Cablevision Systems Corp.* 6,750 144,113 Cablevision NY Group Class A* 3,700 126,725 Charter Communications, Inc.* 5,500 77,770 Cox Radio, Inc.* 3,700 80,290 Echostar Communications Corp.* 13,950 323,501 Entercom Communications Corp.* 8,950 301,615 Hispanic Broadcasting Corp.* 3,400 56,984 Interpublic Group Cos., Inc. 2,200 49,390 Lamar Advertising Co.* 9,850 309,290 Omnicom Group 3,700 284,086 TMP Worldwide, Inc.* 10,060 300,291 USA Networks, Inc.* 23,950 441,638 Univision Communications, Inc.* 2,500 62,500 WPP Group 8,490 76,776 WPP Group (ADR) 900 39,960 --------- 2,674,928 Oil & Gas - 2.64% Anadarko Pete Co. 5,700 325,185 Apache Corp. 6,050 312,180 Kerr McGee 2,100 120,960 Murphy Oil Corp. 1,400 111,300 --------- 869,625 Pharmaceuticals - 6.51% Andrx Corp.* 6,600 428,538 Forest Laboratories, Inc.* 10,800 803,304 King Pharmaceuticals, Inc.* 9,000 350,910
Shares Value ------ ----- Pharmaceuticals - continued Teva Pharmaceutical Industries 9,100 $562,380 --------- 2,145,132 Retail Trade - 3.35% American Eagle Outfitters, Inc.* 4,000 109,600 Best Buy Company, Inc.* 3,300 181,170 CDW Computer Centers, Inc.* 7,700 354,585 Estee Lauder Co., Inc. 2,000 64,500 Kohl's Corp.* 6,200 344,782 Office Depot, Inc.* 3,600 48,960 --------- 1,103,597 Semiconductor Equipment & Products - 13.61% ASM Lithography Holding N V* 11,200 161,056 Altera Corp.* 15,100 305,020 Cree, Inc.* 15,900 285,405 Cypress Semiconductor Corp.* 10,000 197,500 Globespan Semiconductor, Inc.* 11,850 141,726 KLA Tencor Corp.* 4,400 179,784 LSI Logic Corp.* 17,600 298,320 Linear Technology Corp. 10,300 399,640 Maxim Integrated Products, Inc.* 11,500 526,125 Microchip Technology, Inc.* 12,275 383,226 Micron Technology, Inc.* 11,400 259,464 Novellus System, Inc.* 9,600 317,088 PMC Sierra, Inc.* 4,100 66,543 RF Micro Devices, Inc.* 14,100 288,204 Teradyne, Inc.* 3,400 78,370 Transwitch Corp.* 12,800 42,368 Vitesse Semiconductor Corp.* 14,700 138,768 Xilinx, Inc.* 13,650 415,233 --------- 4,483,840 Software - 10.66% Adobe Systems, Inc. 9,000 237,600 Amdocs Limited* 5,050 131,856 BEA Systems, Inc.* 17,700 214,878 Intuit* 7,100 285,562 Liberate Technologies* 15,000 148,200 Macromedia, Inc.* 3,800 56,848 Mercury Interactive Corp.* 11,350 270,357 Micromuse, Inc.* 20,600 190,550 Nvidia Corp.* 10,400 445,744 Peoplesoft, Inc.* 9,800 291,746 Peregrine Systems, Inc.* 10,850 156,674 Quest Software, Inc.* 10,900 161,320 Rational Software Corp.* 22,700 297,824 Siebel Systems, Inc.* 12,800 209,024 SmartForce Plc* 6,900 113,574 Veritas Software Corp.* 10,500 297,990 --------- 3,509,747 Telecommunications - 2.71% Allegiance Telecom, Inc.* 23,450 168,371 Colt Telecommunications Group Plc* 3,150 22,523 Crown Castle Int'l Corp.* 15,200 177,840 Nextel Partners, Inc.* 27,300 146,055
The accompanying notes are an integral part of the financial statements. 65 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Telecommunications - continued Time Warner Telecom., Inc.* 22,870 $250,655 Western Wireless Corp.* 4,300 125,431 ------------ 890,875 TOTAL COMMON STOCKS (Cost $50,214,499) $32,935,063 ------------ TOTAL INVESTMENTS (Mid Cap Growth Fund) (Cost $50,214,499) $32,935,063 ------------ - --------------------------------------------------- Mid Cap Value Fund - --------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 91.30% Auto Components - 2.46% Lear Corp.* 13,000 $399,100 Visteon Corp. 27,900 332,010 ------------ 731,110 Banking - 4.77% Astoria Financial Corp. 6,600 343,794 Comerica, Inc. 4,600 212,014 Golden State Bancorp, Inc. 11,500 291,640 Greenpoint Financial Corp. 10,100 323,705 Southtrust Corp. 10,800 244,728 ------------ 1,415,881 Chemicals - 1.04% Air Products & Chemicals, Inc. 7,700 308,308 ------------ Commercial Services & Supplies - 9.50% Certegy, Inc.* 5,300 151,050 Choicepoint, Inc.* 6,400 273,792 Dun & Bradstreet Corp.* 9,100 284,466 Pitney Bowes, Inc. 11,400 417,924 Sabre Holdings Corp.* 13,500 355,050 Valassis Communications, Inc.* 15,300 477,360 Viad Corp. 19,500 380,250 Waste Management, Inc. 19,600 480,200 ------------ 2,820,092 Communications Equipment - 0.81% Comverse Technology, Inc.* 12,900 242,649 ------------ Computers & Peripherals - 1.00% Apple Computer* 16,800 295,008 ------------ Construction Materials - 0.94% Vulcan Materials Co. 6,700 278,519 ------------ Electrical Equipment - 0.96% Harris Corp. 8,300 284,524 ------------ Electronic Equipment & Instruments - 0.79% Arrow Electonics, Inc.* 9,600 234,720 ------------
Shares Value ------ ----- Financial Services - 1.51% Federated Investments, Inc. 10,100 $263,610 Phoenix Companies, Inc.* 14,400 185,040 ------------ 448,650 Food Products - 2.62% Archer Daniels Midland Co. 29,060 404,806 Suiza Foods Corp.* 6,300 371,511 ------------ 776,317 Health Care Equipment & Supplies - 3.03% Beckman Coulter, Inc. 10,600 450,182 Becton Dickinson & Co. 12,500 447,500 ------------ 897,682 Health Care Providers & Services - 4.04% Amerisource Bergen Corp.* 3,675 233,583 Cigna Corp. 6,400 466,560 Omnicare, Inc. 25,000 497,000 ------------ 1,197,143 Hotels, Restaurants & Leisure - 3.82% Gtech Holdings Corp.* 11,800 470,820 Starwood Hotels & Resorts 13,800 304,152 Tricon Global Restaurants, Inc.* 7,100 359,189 ------------ 1,134,161 IT Consulting & Services - 0.33% KPMG Consulting, Inc.* 7,900 97,328 ------------ Insurance - 11.22% Ace, Ltd. 8,100 285,525 Ambac Financial Group, Inc. 9,650 463,200 Chubb Corp. 5,200 355,160 John Hancock Financial Services 8,000 272,640 MBIA, Inc. 9,050 416,843 Principal Financial Group* 3,200 72,000 Radian Group, Inc. 12,000 406,440 St Paul Companies, Inc. 7,800 358,020 Willis Group Holding, Ltd.* 20,300 472,787 XL Capital, Ltd. 2,600 225,836 ------------ 3,328,451 Machinery - 1.52% Pall Corp. 22,200 450,660 ------------ Marine - 1.49% Teekay Shipping Corp. 16,000 442,240 ------------ Media - 5.60% Belo Corp. 20,100 343,710 Cablevision Systems Corp.* 9,700 332,225 Knight Ridder, Inc. 7,400 416,250 USA Networks, Inc.* 14,800 272,912 Westwood One, Inc.* 12,400 294,996 ------------ 1,660,093 Multi-Utilities 1.67% Sierra Pacific 24,400 354,044 Utilicorp United, Inc. 4,800 142,224 ------------ 496,268
The accompanying notes are an integral part of the financial statements. 66 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Oil & Gas - 8.81% Apache Corp. 6,100 $314,760 Conoco, Inc.* 8,400 215,880 EOG Resources, Inc. 9,900 350,163 Equitable Resources, Inc. 10,000 329,100 Imperial Oil, Ltd. 5,800 159,558 Ocean Energy, Inc. 13,900 253,675 Talisman Energy, Inc. 8,700 305,457 USX Marathon Group 13,400 369,706 XTO Energy, Inc. 17,500 315,000 ------------ 2,613,299 Pharmaceuticals - 1.67% ICN Pharmaceuticals, Inc. 12,000 290,520 Teva Pharmaceuticals Industries, Ltd. 3,300 203,940 ------------ 494,460 Real Estate - 5.31% Archstone Smith Trust 18,200 440,440 AvalonBay Community, Inc. 10,600 481,240 Boston Properties, Inc. 6,000 212,100 Equity Residential Properties Trust 8,200 212,790 Vornado Realty Trust 5,800 227,360 ------------ 1,573,930 Retail - 1.83% May Department Stores Co. 12,400 389,980 Ross Stores, Inc. 4,900 153,370 ------------ 543,350 Software - 1.87% Cadence Design Systems, Inc.* 14,700 310,758 Mentor Graphics Corp.* 12,900 244,584 ------------ 555,342 Specialty Retail - 3.06% Payless Shoesource, Inc.* 7,800 412,230 Sherwin-Williams Company 20,300 494,508 ------------ 906,738 Transportation - Road & Rail - 2.09% CSX Corp. 9,200 310,040 Canadian National 7,800 308,880 ------------ 618,920 Utilities - Electrical & Gas - 7.54% Allegheny Energy, Inc. 8,100 296,055 American Electric Power, Inc. 7,400 310,060 Dominion Resources, Inc. 5,400 330,048 Exelon Corp. 8,225 346,026 First Energy Corp. 8,900 306,694 Pinnacle West Corp. 7,300 307,695 Teco Energy, Inc. 13,200 339,900 ------------ 2,236,478 ------------ TOTAL COMMON STOCKS (Cost $28,334,229) $27,082,321 ------------ COMMON STOCK UNIT - 4.96% Midcap SPDR Trust (Cost $1,499,032) 17,800 $1,471,170 ------------
Principal Value --------- ----- REPURCHASE AGREEMENTS - 3.74% Repurchase Agreement with State Street Bank & Trust Co, dated 10/31/01 at 2.52%, to be repurchased at $1,110,077 on 11/01/01, collateralized by U.S. Government Securities (Cost $1,110,000) $1,110,000 $1,110,000 ------------ TOTAL INVESTMENTS (Mid Cap Value Fund) (Cost $30,943,261) $29,663,491 ------------ - ---------------------------------------------------------------------------- Science & Technology Fund - ---------------------------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 85.12% Commercial Services & Supplies - 5.94% Certegy, Inc.* 6,100 $173,850 Concord EFS, Inc.* 10,600 290,122 First Data Corp. 3,200 216,224 Paychex, Inc. 4,100 131,446 ------------ 811,642 Communications Equipment - 14.72% Brocade Communications Sys., Inc.* 11,000 270,050 Ciena Corp.* 12,400 201,624 Cisco Systems, Inc.* 23,500 397,620 JDS Uniphase Corp.* 24,600 196,554 Juniper Networks, Inc.* 5,500 122,595 Nokia Corp. 17,800 365,078 Oni Systems Corp.* 13,500 66,015 Qualcomm, Inc.* 6,800 334,016 Sonus Networks, Inc.* 13,600 57,256 ------------ 2,010,808 Computers & Peripherals - 3.05% EMC Corp.* 21,900 269,808 Network Appliance, Inc.* 11,000 146,300 ------------ 416,108 Electronic Equipment & Instruments - 3.83% Celestica, Inc.* 6,100 209,352 Sanmina Corp.* 3,800 57,532 Sci Systems, Inc.* 11,000 223,410 Solectron Corp.* 2,700 33,210 ------------ 523,504 Internet Software & Services - 7.87% Openwave Systems, Inc.* 27,300 211,029 Real Networks, Inc.* 5,500 31,185 Verisign, Inc.* 21,500 832,265 ------------ 1,074,479 Machinery - 0.76% Cognex Corp.* 5,500 104,390 ------------ Media - 4.03% AOL Time Warner, Inc.* 13,700 427,577 TMP Worldwide, Inc.* 4,100 122,385 ------------ 549,962
The accompanying notes are an integral part of the financial statements. 67 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Semiconductor Equipment & Products - 20.10% Agere Systems, Inc.* 41,000 $188,600 Altera Corp.* 12,800 258,560 Analog Devices, Inc.* 13,600 516,800 ASM Lithography Holding NV* 5,500 79,090 C MAC Industries, Inc.* 4,100 87,330 Flextronics International* 22,700 451,730 Maxim Integrated Products, Inc.* 13,600 622,200 Q Logic Corp.* 3,400 133,790 Texas Instruments, Inc. 4,100 114,759 Xilinx, Inc.* 9,600 292,032 ------------ 2,744,891 Software - 21.81% Adobe Systems, Inc. 10,200 269,280 Electronic Arts, Inc.* 16,800 864,528 Informatica Corp.* 10,100 93,627 Internet Security Systems, Inc.* 2,300 60,835 Mercury Interactive Corp.* 8,600 204,852 Microsoft Corp.* 6,000 348,900 Netiq* 2,300 64,745 Oracle Corp.* 23,300 315,948 SAP AG 2,100 217,217 Siebel Systems, Inc.* 12,300 200,859 Veritas Software Corp.* 11,900 337,722 ------------ 2,978,513 Telecommunications - 3.01% Millicom International Cellular* 2,700 29,835 Vodafone Group Plc 16,500 381,480 ------------ 411,315 TOTAL COMMON STOCKS (Cost $16,077,183) $11,625,612 ------------ SHORT TERM INVESTMENTS - 12.89% T Rowe Price Reserve Inv. Fund (Cost $1,760,472) 1,760,472 $1,760,472 ------------ Principal Value --------- ----- REPURCHASE AGREEMENTS - 1.99% Repurchase Agreement with State Street Bank & Trust Co, dated 10/31/01 at 2.52%, to be repurchased at $271,019 on 11/01/01, collateralized by U.S. Government Securities (Cost $271,000) $271,000 $271,000 ------------ TOTAL INVESTMENTS (Science & Technology Fund) (Cost $18,108,655) $13,657,084 ------------ - -------------------------------------------------------- Small Cap Growth Fund - -------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 89.93% Aerospace & Defense - 1.42% Aeroflex, Inc.* 23,000 $337,410 Triumph Group, Inc.* 3,500 89,915 ------------ 427,325
Shares Value ------ ----- Auto Components - 1.15% Borg Warner Automotive, Inc. 5,300 $226,416 Superior Industries Int'l, Inc. 3,700 122,248 ------------ 348,664 Biotechnology - 8.93% Aclara Biosciences, Inc.* 8,675 45,110 Affymetrix, Inc.* 15,900 477,795 Alkermes, Inc.* 29,600 759,240 Celegene Corp.* 7,800 256,776 Cell Therapeutics, Inc.* 9,600 288,288 Cubist Pharmaceuticals, Inc.* 6,300 253,890 Lynx Therapeutics, Inc.* 9,000 22,050 Medarex, Inc.* 15,200 313,120 Sepracor, Inc.* 5,900 279,896 ------------ 2,696,165 Building Products - 0.53% Dal Tile Int'l, Inc.* 9,900 160,479 ------------ Communications Equipment - 9.16% Adaptec, Inc.* 12,100 145,805 Commscope, Inc.* 10,700 209,185 Emulex Corp.* 17,600 416,768 McData Corp.* 29,800 438,358 Polycom, Inc.* 24,650 739,007 Powerwave Technologies, Inc.* 25,400 388,620 Tekelec, Inc.* 22,300 428,160 ------------ 2,765,903 Construction & Engineering - 0.90% Granite Constuction, Inc. 10,899 271,385 ------------ Diversified Financial - 3.34% Affiliated Managers Group, Inc.* 4,600 283,820 Americredit Corp.* 14,400 223,200 Indymac Bancorp, Inc.* 11,000 283,965 Raymond James Financial, Inc. 7,400 216,302 ------------ 1,007,287 Electrical Equipment - 0.72% Plexus Corp.* 8,704 217,600 ------------ Electronic Equipment & Instruments - 0.98% APW, Ltd.* 35,900 96,571 Power Integrations* 8,700 200,187 ------------ 296,758 Food & Drug Retailing - 0.89% Fleming Companies, Inc. 11,200 269,920 ------------ Food Products - 0.66% Hain Celestial Group, Inc.* 10,200 201,144 ------------ Health Care Equipment & Supplies - 3.05% Alliance Imaging, Inc.* 17,200 210,700 Caliper Technologies Corp.* 2,600 31,382
The accompanying notes are an integral part of the financial statements. 68 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Health Care Equipment & Supplies - continued Inhale Therapeutic Systems* 8,700 $152,250 Henry Schein, Inc.* 8,600 290,250 Therasense, Inc.* 9,200 237,360 ------------ 921,942 Health Care Providers & Services - 13.33% Advance PCS* 8,400 510,468 Apria Healthcare Group, Inc.* 10,000 230,000 Community Health Services, Inc.* 22,175 554,375 Davita, Inc.* 12,500 227,500 Lifepoint Hospitals, Inc.* 8,800 274,384 Manor Care, Inc.* 8,600 200,896 Mid Atlantic Medical Services, Inc.* 19,100 354,305 Oxford Health Plans, Inc.* 18,500 435,860 Province Healthcare Co.* 17,800 490,390 Renal Care Group, Inc.* 9,500 298,300 Universal Health Services, Inc.* 11,200 452,368 ------------ 4,028,846 Household Durables - 0.72% Mohawk Industries, Inc.* 5,000 216,000 ------------ Insurance - 1.17% HCC Insurance Holdings, Inc. 12,800 351,872 ------------ Internet & Catalog Retail - 0.74% Valuevision International, Inc.* 16,300 222,332 ------------ Internet Software & Services - 2.07% Interwoven, Inc.* 40,500 296,055 Matrixone, Inc.* 24,600 135,300 Openwave Systems, Inc.* 25,400 196,342 ------------ 627,697 IT Consulting & Services - 1.18% Priority Healthcare Corp.* 12,300 355,347 ------------ Media - 4.78% Emmis Communications Corp.* 21,700 294,035 Entercom Communications Corp.* 8,500 286,450 Getty Images, Inc.* 13,000 202,670 Insight Communications, Inc.* 10,300 211,150 Media.com Communications Corp.* 11,300 151,646 Scholastic Corp.* 6,700 299,490 ------------ 1,445,441 Oil & Gas - 2.02% Newfield Exploration Co.* 5,000 174,050 Pogo Producing Co. 6,200 169,384 Stone Energy Corp.* 6,800 268,940 ------------ 612,374 Pharmaceuticals - 5.45% Intermune, Inc.* 6,300 275,121 KV Pharmaceutical Co.* 8,000 202,160 Medicis Pharmaceutical Corp.* 10,600 611,514 Osi Pharmaceuticals, Inc.* 3,700 169,016 Praecis Pharmaceuticals, Inc.* 19,800 85,734 Scios, Inc.* 13,100 302,610 ------------ 1,646,155
Shares Value ------ ----- Retail - 8.39% Barnes & Noble, Inc.* 17,700 $650,475 Cost Plus, Inc.* 13,900 270,355 Footstar, Inc.* 9,300 310,620 Linens "N Things, Inc.* 10,700 194,740 Nautica Enterprises, Inc.* 14,200 172,104 Pacific Sunwear of California* 19,100 262,625 Ross Stores, Inc. 7,700 241,010 United Rentals, Inc.* 11,400 208,050 Tommy Hilfiger Corp.* 19,600 225,204 ------------ 2,535,183 Semiconductor Equipment & Products - 6.59% Brooks Automation, Inc.* 9,100 293,748 Cymer, Inc.* 14,800 309,320 Exar Corp.* 11,650 262,591 Micosemi Corp.* 7,100 248,500 Photronics, Inc.* 14,600 362,372 PRI Automation, Inc.* 12,925 212,487 Varian Semiconductor Equip., Inc.* 10,000 300,400 ------------ 1,989,418 Software - 11.76% Agile Software Corp.* 24,600 234,192 Avant Corp.* 15,600 157,716 Documentum, Inc.* 23,600 348,572 Informatica Corp.* 33,200 307,764 Manhattan Associates, Inc.* 9,700 291,388 Manugistics Group, Inc.* 41,100 316,470 National Instruments Corp.* 6,650 191,587 Netiq* 9,900 278,685 Networks Associates, Inc.* 30,500 585,600 Precise Software Solutions, Ltd.* 5,900 112,749 QRS Corp.* 800 7,760 Radiant Systems, Inc.* 23,500 155,335 Seachange International, Inc.* 16,900 415,740 Smartforce Public, Ltd.* 9,000 148,140 ------------ 3,551,698 TOTAL COMMON STOCKS (Cost $31,976,531) $27,166,935 ------------ Principal Value --------- ----- REPURCHASE AGREEMENTS - 10.07% Repurchase Agreement with State Street Bank & Trust Co, dated 10/31/01 at 2.52%, to be repurchased at $3,041,210 on 11/01/01, collateralized by U.S. Government Securities (Cost $3,041,000) $3,041,000 $3,041,000 ------------ TOTAL INVESTMENTS (Small Cap Growth Fund) (Cost $35,017,531) $30,207,935 ------------
The accompanying notes are an integral part of the financial statements. 69 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Stock Index Fund - -------------------------------------------------
Shares Value ------ ----- COMMON STOCKS - 92.84% Aerospace & Defense - 1.36% Boeing Co. 2,600 $84,760 General Dynamics Corp. 600 48,960 Goodrich B F Co. 310 6,618 Honeywell Int'l, Inc. 2,410 71,215 Lockheed Martin Corp. 1,290 62,913 Northrop Grumman Corp. 250 24,987 Raytheon Co. 1,150 37,087 Rockwell Collins, Inc. 550 7,425 United Technologies Corp. 1,400 75,446 ------------ 419,411 Air Freight & Couriers - 0.12% Fedex Corp.* 920 37,793 ------------ Airlines - 0.17% AMR Corp.* 460 8,372 Delta Air Lines Inc. 370 8,458 Southwest Airlines Co. 2,265 36,013 US Airways Group, Inc.* 200 922 ------------ 53,765 Auto Components - 0.25% Cooper Tire and Rubber Co. 220 2,906 Dana Corp. 440 4,730 Delphi Automotive Sys. Corp. 1,670 19,389 Goodyear Tire And Rubber 470 8,756 Johnson Controls, Inc. 260 18,803 Snap-On, Inc. 170 4,549 TRW, Inc. 370 12,502 Visteon Corp. 394 4,688 ------------ 76,323 Automobiles - 0.63% Ford Motor Co. 5,451 87,488 General Motors Corp. 1,630 67,351 Harley Davidson, Inc. 900 40,734 ------------ 195,573 Banks - 5.37% Amsouth BanCorp. 1,100 19,019 Bank of America Corp. 4,780 281,972 Bank New York, Inc. 2,190 74,482 Bank One Corp. 3,470 115,169 BP&T Corp. 1,300 41,730 Charter One Finl., Inc. 651 17,740 Comerica, Inc. 530 24,428 Fifth Third BanCorp. 1,714 96,704 FleetBoston Finl. Corp. 3,229 106,105 Golden West Finl. Corp. 470 22,842 Huntington Bancshares, Inc. 750 11,572 KeyCorp. 1,270 27,000 Mellon Finl. Corp. 1,420 47,712 National City Corp. 1,790 47,256 Northern Trust Corp. 660 33,323
Shares Value ------ ----- Banks - continued PNC Finl. Svcs. Group, Inc. 860 $47,214 Regions Financial Corp. 680 18,299 South Trust Corp. 1,010 22,887 Suntrust Banks, Inc. 870 52,078 Synovus Finl. Corp. 860 19,797 Union Planters Corp. 410 16,605 US BanCorp. 5,679 100,973 Wachovia Corp. 4,180 119,548 Washington Mutual, Inc. 2,615 78,947 Wells Fargo & Co. 5,110 201,845 Zions Bancorporation 270 12,938 ------------ 1,658,185 Beverages - 2.54% Anheuser Busch Cos., Inc. 2,670 111,232 Brown Forman Corp. 200 11,888 Coca Cola Co. 7,410 354,791 Coca Cola Enterprises, Inc. 1,330 24,405 Coors, Adolph Co. 110 5,473 Pepsi Bottling Group, Inc. 430 19,986 Pepsico, Inc. 5,257 256,068 ------------ 783,843 Biotechnology - 0.95% Amgen, Inc.* 3,110 176,710 Biogen, Inc.* 440 24,200 Chiron Corp.* 570 30,677 Immunex Corp.* 1,590 37,985 Medimmune, Inc.* 630 24,721 ------------ 294,293 Building Products - 0.10% Crane Co. 180 3,686 Masco Corp. 1,370 27,167 ------------ 30,853 Chemicals - 1.14% Air Products & Chemicals, Inc. 680 27,227 Dow Chemical Co. 2,675 88,944 Du Pont E I De Nemours & Co. 3,110 124,369 Eastman Chemical Co. 230 7,891 Engelhard Corp. 390 10,210 FMC Corp.* 90 4,271 Great Lakes Chemical Corp. 150 3,181 Hercules, Inc.* 320 2,419 International Flavours & Fragrances 290 8,268 PPG Industries, Inc. 500 24,415 Praxair, Inc. 480 22,646 Rohm & Haas Co. 660 21,430 Sigma-Aldrich 230 8,630 ------------ 353,901 Commercial Services & Supplies - 1.73% Allied Waste Industries, Inc.* 590 5,853 Automatic Data Processing, Inc. 1,860 96,088 Avery Dennison Corp. 330 15,279 Block, H & R, Inc. 540 18,403 Cendant Corp.* 2,890 37,454
The accompanying notes are an integral part of the financial statements. 70 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Commercial Services & Supplies - continued Cintas Corp. 500 $20,210 Concord EFS, Inc.* 1,440 39,413 Convergys Corp.* 510 14,331 Deluxe Corp. 210 7,350 Donnelley, R R & Sons Co. 350 8,925 Ecolab, Inc. 380 13,368 Equifax, Inc. 430 9,615 First Data Corp. 1,170 79,057 Fiserv, Inc.* 555 20,640 IMS Health, Inc. 880 18,806 Paychex, Inc. 1,110 35,587 Pitney Bowes, Inc. 740 27,128 Robert Half Int'l, Inc.* 520 10,728 Sabre Holdings Corp.* 399 10,494 Waste Management, Inc. 1,860 45,570 ------------ 534,299 Communications Equipment - 2.72% ADC Telecommunications, Inc.* 2,330 10,602 Andrew Corp.* 240 4,361 Avaya, Inc.* 848 7,573 Ciena Corp.* 970 15,772 Cisco Systems, Inc.* 21,800 368,856 Comverse Technology, Inc.* 550 10,346 Corning, Inc. 2,770 22,326 JDS Uniphase Corp.* 3,920 31,321 Lucent Technologies, Inc. 10,150 68,005 Motorola, Inc. 6,540 107,060 Nortel Networks Corp. 9,490 55,137 Qualcomm, Inc.* 2,260 111,011 Scientific Atlanta, Inc. 490 10,226 Tellabs, Inc.* 1,220 16,653 ------------ 839,249 Computers & Peripherals - 3.67% Apple Computer, Inc.* 1,040 18,262 Compaq Computer Corp. 5,030 44,012 Dell Computer Corp.* 7,750 185,845 E M C Corp.* 6,570 80,942 Gateway, Inc.* 960 5,424 Hewlett Packard Co. 5,790 97,446 IBM 5,180 559,802 Lexmark Int'l., Inc.* 380 17,005 NCR Corp.* 290 10,280 Network Appliance, Inc.* 970 12,901 Palm, Inc.* 1,689 4,155 Sun Microsystems, Inc.* 9,700 98,455 ------------ 1,134,529 Construction & Engineering - 0.04% Fluor Corp. 240 8,933 McDermott Int'l., Inc.* 180 1,908 ------------ 10,841 Construction Materials - 0.04% Vulcan Materials Co. 300 12,471 ------------
Shares Value ------ ----- Containers & Packaging - 0.12% Ball Corp. 80 $4,923 Bemis, Inc. 160 6,923 Pactiv Corp.* 470 7,614 Sealed Air Corp.* 250 10,010 Temple-Inland, Inc. 150 7,498 ------------ 36,968 Diversified Financials - 6.82% American Express Co. 3,940 115,954 Bear Stearns Cos., Inc. 280 15,120 Capital One Finl. Corp. 620 25,612 Citigroup, Inc. 14,982 681,980 Countrywide Credit Inds., Inc. 350 13,975 Federal Home Ln Mtg. Corp. 2,060 139,709 Federal Nat'l Mtg. Assn. 2,980 241,261 Franklin Resources, Inc. 790 25,359 Household Int'l., Inc. 1,380 72,174 JP Morgan Chase & Co. 5,916 209,190 Lehman Bros. 730 45,596 MBNA Corp. 2,540 70,129 Merrill Lynch & Co., Inc. 2,500 109,275 Moodys Corp. 470 16,318 Morgan Stanley Dean Witter & Co. 3,320 162,414 Providian Financial Corp. 850 3,307 Charles Schwab Corp. 4,130 53,194 State Street Corp. 970 44,174 Stilwell Financial, Inc. 650 13,071 T Rowe Price & Assoc, Inc. 370 10,271 USA Education, Inc. 490 39,964 ------------ 2,108,047 Diversified Telecommunication - 4.70% Alltel Corp. 930 53,140 AT & T Corp. 10,280 156,770 Bellsouth Corp. 5,580 206,460 CenturyTel, Inc. 420 13,272 Citizens Communication Co.* 850 7,557 Qwest Communications Int'l, Inc. 4,949 64,089 SBC Communications, Inc. 10,030 382,243 Sprint Corp. 2,640 52,800 Verizon Communications 8,058 401,369 Worldcom, Inc.* 8,600 115,670 ------------ 1,453,370 Electric Utilities - 2.44% AES Corp.* 1,590 22,022 Allegheny Energy, Inc. 370 13,524 Ameren Corp. 410 16,441 American Electric Power, Inc. 960 40,224 Calpine Corp.* 890 22,028 Cinergy Corp. 470 14,185 CMS Energy Corp. 390 8,389 Consolidated Edison, Inc. 630 24,879 Constellation Energy Group, Inc. 490 10,961 Dominion Resource, Inc. 780 47,674 DTE Energy Co. 490 20,428
The accompanying notes are an integral part of the financial statements. 71 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Electric Utilities - continued Duke Energy Co. 2,300 $88,343 Edison Int'l.* 970 13,784 Entergy Corp. 660 25,641 Exelon Corp. 960 40,387 FirstEnergy Corp. 670 23,088 FPL Group, Inc. 520 27,612 GPU, Inc. 360 14,274 Mirant Corp.* 1,011 26,286 Niagara Mohawk Hldgs., Inc.* 480 8,602 PG&E Corp. 1,150 20,769 Pinnacle West Capital Corp. 250 10,538 PPL Corp. 440 15,026 Progress Energy, Inc. 650 27,411 Public Svc Enterprise Group 620 24,403 Reliant Energy, Inc. 890 24,876 Southern Co. 2,040 48,756 Teco Energy, Inc. 400 10,300 TXU Corp. 770 35,297 XCEL Energy, Inc. 1,020 28,846 ------------ 754,994 Electrical Equipment - 0.43% American Power Conversion Corp.* 580 7,465 Cooper Industries, Inc. 280 10,836 Emerson Electric Co. 1,280 62,746 Molex, Inc. 580 16,779 National Services Inds., Inc. 120 2,129 Power One, Inc.* 230 1,819 Rockwell Int'l Corp. 550 7,579 Symbol Technologies, Inc. 675 8,674 Thermo Electron Corp.* 540 11,416 Thomas & Betts Corp. 170 3,087 ------------ 132,530 Electronic Equipment & Instruments - 0.33% Agilent Technologies, Inc.* 1,359 30,265 Jabil Circuit, Inc.* 570 12,084 Millipore Corp. 140 7,322 PerkinElmer, Inc. 300 8,073 Sanmina Corp.* 950 14,383 Solectron Corp.* 1,950 23,985 Tektronix, Inc.* 280 5,516 ------------ 101,628 Energy Equipment & Services - 0.68% Baker Hughes, Inc. 1,000 35,830 Halliburton Co. 1,280 31,603 Nabors Industries, Inc.* 440 13,526 Noble Drilling Corp.* 400 12,220 Rowan Cos., Inc.* 280 4,729 Schlumberger, Ltd. 1,710 82,798 Transocean Sedco Forex, Inc. 950 28,643 ------------ 209,349 Food & Drug Retailing - 1.13% Albertsons, Inc. 1,210 38,611 CVS Corp. 1,170 27,963
Shares Value ------ ----- Food & Drug Retailing - continued Kroger Co.* 2,420 $59,193 Safeway, Inc.* 1,510 62,892 Supervalu, Inc. 390 8,323 Sysco Corp. 2,000 48,220 Walgreen Co. 3,030 98,111 Winn Dixie Stores, Inc. 420 4,645 ------------ 347,958 Food Products - 1.45% Archer Daniels Midland Co. 1,974 27,498 Campbell Soup Co. 1,220 34,453 Conagra, Inc. 1,600 36,640 General Mills, Inc. 850 39,032 H J Heinz Co. 1,040 44,138 Hershey Foods Corp. 410 26,129 Kellogg Co. 1,210 36,905 Ralston Purina Co. 920 30,167 Sara Lee Corp. 2,340 52,159 Unilever N V 1,700 88,366 Wrigley (WM) Jr Co. 670 33,534 ------------ 449,021 Gas Utilities - 0.47% El Paso Energy Corp. 1,517 74,424 Keyspan Corp. 410 13,604 Kinder Morgan, Inc. 340 16,874 Nicor, Inc. 140 5,445 Nisource, Inc. 620 14,725 Peoples Energy Corp. 110 4,212 Sempra Energy 610 14,274 ------------ 143,558 Health Care Equipment & Supplies - 1.45% Applera Corp. 630 18,383 Bard, C R, Inc. 150 8,235 Bausch & Lomb, Inc. 160 5,210 Baxter Int'l., Inc. 1,770 85,615 Becton Dickinson & Co. 770 27,566 Biomet, Inc. 795 24,247 Boston Scientific Corp.* 1,200 27,288 Guidant Corp.* 910 37,774 Medtronic, Inc. 3,600 145,080 St Jude Medical, Inc.* 260 18,460 Stryker Corp. 580 32,619 Zimmer Holdings, Inc.* 579 17,897 ------------ 448,374 Health Care Providers & Services - 1.36% Aetna, Inc.* 420 11,609 Amerisource Bergen Corp.* 310 19,703 Cardinal Health, Inc. 1,330 89,256 Cigna Corp. 450 32,805 HCA Healthcare Co. 1,600 63,456 Healthsouth Corp.* 1,160 15,103 Humana, Inc.* 510 5,891 Manor Care, Inc.* 310 7,242 McKesson HBOC, Inc. 850 31,442
The accompanying notes are an integral part of the financial statements. 72 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Health Care Providers & Services - continued Quintiles Transnational Corp.* 350 $5,551 Tenet Healthcare Corp.* 970 55,794 Unitedhealth Group, Inc. 950 62,462 Wellpoint Health Networks, Inc.* 190 21,202 ------------ 421,516 Hotels, Restaurants & Leisure - 0.86% Carnival Corp. 1,740 37,897 Darden Restaurants, Inc. 350 11,207 Harrah's Entertainment, Inc.* 350 10,195 Hilton Hotels Corp. 1,100 9,416 International Game Technology* 220 11,231 Marriott Int'l., Inc. 730 22,871 McDonald's Corp. 3,850 100,370 Starbucks Corp.* 1,130 19,345 Starwood Hotels & Resorts 590 13,003 Tricon Global Restaurants, Inc.* 440 22,260 Wendy's Int'l., Inc. 340 8,942 ------------ 266,737 Household Durables - 0.36% American Greetings Corp. 190 2,664 Black & Decker Corporation 240 7,942 Centex Corp. 180 6,887 Fortune Brands, Inc. 460 16,951 Kaufman & Broad Home Corp. 130 3,841 Leggett & Platt, Inc. 590 12,785 Maytag Corp. 230 6,412 Newell Rubbermaid, Inc. 790 21,836 Pulte Corp. 180 5,850 Stanley Works 250 9,580 Tupperware Corp. 170 3,466 Whirlpool Corp. 200 11,804 ------------ 110,018 Household Products - 1.60% Clorox Co. 710 25,347 Colgate Palmolive Co. 1,670 96,058 Kimberly Clark Corp. 1,590 88,261 Procter & Gamble Co. 3,860 284,791 ------------ 494,457 Industrial Conglomerates - 4.89% General Electric Co. 29,590 1,077,372 ITT Industries, Inc. 260 12,503 Minnesota Mining & Mfg., Co. 1,180 123,168 Textron, Inc. 420 13,293 Tyco Int'l., Ltd. 5,774 283,734 ------------ 1,510,070 Insurance - 4.12% Aflac, Inc. 1,570 38,402 Allstate Corp. 2,160 67,781 Ambac Financial Group, Inc. 320 15,360 American Int'l Group, Inc.a 7,802 613,237 AON Corp. 780 29,671 Chubb Corp. 520 35,516 Cincinnati Financial Corp. 480 17,856
Shares Value ------ ----- Insurance - continued Conseco, Inc.* 1,010 $3,020 Hartford Financial Services Group 710 38,340 Jefferson Pilot Corp. 455 18,814 John Hancock Financial Services 920 31,354 Lincoln National Corp. 560 23,716 Loews Corp. 590 29,972 Marsh & McLennan Cos., Inc. 820 79,335 MBIA, Inc. 440 20,266 Metlife, Inc. 2,230 59,987 MGIC Invest. Corp. 320 16,557 Progressive Corp. 220 30,516 Safeco Corp. 380 11,719 St Paul Companies, Inc. 640 29,376 Torchmark, Inc. 370 13,701 UnumProvident Corp. 720 16,150 XL Capital, Ltd. 380 33,007 ------------ 1,273,653 Internet Software & Services - 0.06% Yahoo, Inc.* 1,690 18,387 ------------ IT Consulting Services - 0.38% Computer Sciences Corp.* 500 17,955 Electronic Data Systems Corp. 1,390 89,474 Sapient Corp.* 370 1,595 Unisys Corp.* 940 8,394 ------------ 117,418 Leisure Equipment & Products - 0.19% Brunswick Corp. 260 4,651 Eastman Kodak Co. 860 21,990 Hasbro, Inc. 510 8,451 Mattel, Inc.* 1,280 24,230 ------------ 59,322 Machinery - 0.78% Caterpillar, Inc. 1,020 45,614 Cummins Engine, Inc. 120 3,757 Danaher Corp. 430 23,968 Deere & Co. 700 25,893 Dover Corp. 610 20,100 Eaton Corp. 210 13,742 Illinois Tool Works, Inc. 910 52,052 Ingersoll Rand Co. 500 18,650 Navistar Int'l. Corp., Inc. 180 5,400 Paccar, Inc. 230 12,148 Pall Corp. 370 7,511 Parker Hannifin Corp. 350 12,565 ------------ 241,400 Media - 3.68% AOL Time Warner, Inc.* 13,200 411,972 Clear Channel Communications* 1,750 66,710 Comcast Corp.* 2,820 101,069 Disney, Walt Co. 6,230 115,816 Dow Jones & Co., Inc. 260 11,700 Gannett, Inc. 790 49,928
The accompanying notes are an integral part of the financial statements. 73 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Media - continued Interpublic Group Cos., Inc. 1,119 $25,122 Knight Ridder, Inc. 220 12,375 McGraw Hill Cos., Inc. 580 30,496 Meredith Corp. 150 4,950 New York Times Co. 470 19,388 Omnicom Group 550 42,229 TMP Worldwide, Inc.* 320 9,552 Tribune Co. 890 26,878 Univision Communications, Inc.* 620 15,500 Viacom, Inc.* 5,300 193,503 ------------ 1,137,188 Metals & Mining - 0.65% Alcan Aluminum, Ltd. 950 29,023 Alcoa, Inc. 2,570 82,934 Allegheny Technologies, Inc. 240 3,552 Barrick Gold Corp. 1,180 18,396 Freeport-McMoran Copper & Gold* 430 4,773 Homestake Mining Co. 780 6,396 INCO, Ltd.* 540 7,366 Newmont Mining Corp. 580 13,456 Nucor Corp. 230 9,499 Phelps Dodge Corp. 230 6,670 Placer Dome, Inc. 980 11,182 U. S. Steel Group 270 3,885 Worthington Industries, Inc. 250 3,250 ------------ 200,382 Multi Utilities - 0.36% Dynegy, Inc. 970 34,823 Enron Corp. 2,220 30,858 Williams Cos., Inc. 1,530 44,171 ------------ 109,852 Multiline Retail - 3.32% Big Lots, Inc. 340 2,482 Costco Wholesale Corp.* 1,340 50,692 Dillard's, Inc. 250 3,238 Dollar General Corp. 990 14,147 Family Dollar Stores, Inc. 510 14,719 Federated Dept Stores, Inc.* 590 18,874 K Mart Corp.* 1,460 8,950 Kohl's Corp.* 990 55,054 May Department Stores Co. 890 27,991 Nordstrom, Inc. 400 5,640 Penney, J C, Inc. 780 16,942 Sears Roebuck & Co. 980 37,995 Target Corp. 2,680 83,482 Wal-Mart Stores, Inc. 13,320 684,648 ------------ 1,024,854 Office Electronics - 0.05% Xerox Corp. 2,070 14,490 ------------ Oil & Gas - 5.71% Amerada Hess Corp. 270 15,863 Anadarko Pete Corp. 747 42,616
Shares Value ------ ----- Oil & Gas - continued Apache Corp. 370 $19,092 Ashland, Inc. 210 8,455 Burlington Resources, Inc. 630 23,468 Chevron Corp. 3,172 280,881 Conoco, Inc.* 1,860 47,802 Devon Energy Corporation 390 14,937 Eog Resources, Inc. 350 12,380 Exxon Mobil Corp. 20,560 811,092 Kerr McGee Corp. 300 17,280 Occidental Petroleum Corp. 1,100 27,852 Phillips Petroluem Co. 1,128 61,374 Royal Dutch Petroleum Co. 6,390 322,759 Sunoco, Inc. 250 9,358 Unocal Corp. 730 23,506 USX Marathon Group 920 25,383 ------------ 1,764,098 Paper & Forest Products - 0.45% Boise Cascade Corp. 170 4,855 Georgia Pacific Corp. 672 18,655 International Paper Co. 1,440 51,552 Louisiana Pacific Corp. 310 2,232 Mead Corp. 300 8,052 Westvaco Corp. 300 7,365 Weyerhaeuser Co. 640 31,942 Willamette Industries, Inc. 330 15,460 ------------ 140,113 Personal Products - 0.45% Alberto Culver Co. 170 7,183 Avon Products, Inc. 710 33,249 Gillette Co. 3,140 97,623 ------------ 138,055 Pharmaceuticals - 10.37% Abbott Laboratories 4,610 244,238 Allergan, Inc. 390 27,998 American Home Products Corp. 3,920 218,854 Bristol Myers Squibb Co. 5,790 309,476 Forest Laboratories, Inc.* 530 39,421 Johnson & Johnson 9,016 522,117 King Pharmaceuticals, Inc.* 680 26,513 Lilly Eli & Co. 3,350 256,275 Merck & Co., Inc. 6,830 435,822 Pfizer, Inc. 18,810 788,139 Pharmacia Corp. 3,880 157,218 Schering Plough Corp. 4,360 162,105 Watson Pharmaceuticals, Inc.* 320j 15,258 ------------ 3,203,434 Real Estate - 0.11% Equity Office Properties 1,210 34,485 ------------ Road & Rail - 0.37% Burlington Northern Santa Fe 1,170 31,438 CSX Corp. 640 21,568 Norfolk Southern Corp. 1,150 19,263
The accompanying notes are an integral part of the financial statements. 74 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Road & Rail - continued Ryder System, Inc. 180 $3,366 Union Pacific Corp. 740 38,487 ------------ 114,122 Semiconductor Equipment & Products - 3.53% Advanced Micro Devices, Inc.* 1,030 10,135 Altera Corp.* 1,150 23,230 Analog Devices, Inc.* 1,070 40,660 Applied Materials, Inc.* 2,420 82,546 Applied Micro Circuits Corp.* 900 9,927 Broadcom Corp.* 780 26,840 Conexant Systems, Inc.* 740 7,511 Intel Corp. 20,030 489,133 KLA Tencor Corp.* 550 22,473 Linear Technology Corp. 950 36,860 LSI Logic Corp.* 1,080 18,306 Maxim Integrated Prods., Inc.* 980 44,835 Micron Technology, Inc.* 1,780 40,513 National Semiconductor Corp.* 520 13,510 Novellus Sys., Inc.* 420 13,873 PMC Sierra, Inc.* 490 7,953 Q Logic Corp.* 270 10,625 Teradyne, Inc.* 520 11,986 Texas Instruments, Inc. 5,170 144,708 Vitesse Semiconductor Corp.* 550 5,192 Xilinx, Inc.* 990 30,116 ------------ 1,090,932 Software - 4.51% Adobe Systems, Inc. 710 18,744 Autodesk Incorporated 160 5,315 BMC Software, Inc.* 730 11,001 Citrix System, Inc.* 550 12,870 Computer Assoc Int'l., Inc. 1,720 53,182 Compuware Corp.* 1,100 11,308 Intuit* 620 24,936 Mercury Interactive Corp.* 250 5,956 Microsoft Corp.* 16,030 932,145 Novell, Inc.* 1,070 3,788 Oracle Corp.* 16,720 226,723 Parametric Technology Corp.* 790 5,538 Peoplesoft, Inc.* 880 26,198 Siebel System, Inc.* 1,350 22,046 Veritas Software Corp.* 1,180 33,488 ------------ 1,393,238 Specialty Retail - 1.88% Autozone, Inc.* 330 19,315 Bed Bath & Beyond, Inc.* 860 21,552 Best Buy Co., Inc.* 620 34,038 Circuit City Stores, Inc. 620 8,506 Gap, Inc. 2,560 33,459 Home Depot, Inc. 6,950 265,699 Limited, Inc. 1,270 14,161 Lowe's Cos., Inc. 2,290 78,089 Office Depot, Inc.* 890 12,104
Shares Value ------ ----- Specialty Retail - continued Radioshack Corp. 550 $13,745 Sherwin-Williams Co. 470 11,449 Staples, Inc.* 1,360 19,829 Tiffany & Co. 440 10,292 TJX Cos., Inc. 840 28,392 Toys "R Us, Inc.* 590 11,210 ----------- 581,840 Textiles & Apparel - 0.20% Liz Claiborne, Inc. 160 7,280 Nike, Inc. 810 39,982 Reebok Int'l., Ltd.* 170 3,529 V F Corp. 330 10,963 ----------- 61,754 Tobacco - 1.05% Philip Morris Cos, Inc. 6,550 306,540 UST, Inc. 490 16,469 ----------- 323,009 Trading Companies & Distributors - 0.09% Genuine Parts Co. 510 16,575 Grainger, W. W., Inc. 280 12,124 ----------- 28,699 Wireless Telecommunication Service - 0.61% ATT Wireless Services, Inc.* 7,539 108,863 Nextel Communications, Inc.* 2,280 18,126 Sprint Corp.* 2,790 62,217 ----------- 189,206 TOTAL COMMON STOCKS (Cost $35,615,438) $28,683,855 ----------- U.S. TREASURY OBLIGATIONS - SHORT TERM - 0.63% Principal Value --------- ----- U.S. Treasury Bills - 0.63% 3.30% due 11/01/01/\ (Cost $195,000)/\ $195,000 $195,000 ----------- REPURCHASE AGREEMENTS - 6.53% Repurchase Agreement with State Street Bank & Trust Co, dated 10/31/01 at 2.52%, to be repurchased at $2,017,139 on 11/01/01, collateralized by U.S. Government Securities (Cost $2,017,000) $2,017,000 $2,017,000 ----------- TOTAL INVESTMENTS (Stock Index Fund) (Cost $37,827,438) $30,895,855 -----------
The accompanying notes are an integral part of the financial statements. 75 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- Global Equity Fund - --------------------------------------------------------------------------------
Shares Value ------ ----- COMMON STOCKS - 96.57% Belgium - 0.67% Dexia 6,900 $106,436 ------------ Canada - 1.00% Talisman Energy 4,550 160,145 ------------ China - 1.30% Huaneng Power International, Inc. 162,000 99,692 UTStarcom, Inc.* 4,625 108,595 ------------ 208,287 Denmark - 2.54% ISS International A/S* 3,450 162,512 Novo Nordisk* 3,775 152,972 Vestas Wind Systems 2,925 91,854 ------------ 407,338 France - 8.99% Altran Technologies 3,750 172,020 Aventis SA 3,400 250,002 J C Decaux International* 10,625 81,232 Pernod-Ricard 2,900 202,803 Sanofi-Synthelabo 1,300 85,650 Technip-Coflexip* 1,367 154,431 Total Fina Elf SA 1,670 234,325 Vinci* 1,400 84,368 Vicendi 2,625 100,841 Vivendi Environnement 1,600 74,690 ------------ 1,440,362 Germany - 3.39% Allianz AG 550 129,512 Altana AG 2,050 95,881 Deutsche Telekom AG 8,600 132,969 Muenchener Rueckversicherungs 350 92,396 SAP AG 3,600 92,520 ------------ 543,278 Hong Kong - 3.01% China Unicom, Ltd.* 14,300 130,559 CNOOC, Ltd. 105,000 102,981 HSBC Holdings Plc 16,800 182,000 Legend Holdings, Ltd. 158,000 66,340 ------------ 481,880 Ireland - 0.63% Ryanair Holdings Plc* 2,150 100,491 ------------ Israel - 0.39% Amdocs, Ltd.* 2,400 62,664 ------------ Italy - 2.58% Alleanza Assicurazioni 13,000 133,883 SAIPEM 33,400 164,928 Telecom Italia Mobile SpA 15,000 55,046 TIM SpA 11,000 59,858 ------------ 413,715 Japan - 6.57% Fujisawa Pharmaceutical Co. 4,000 $95,965 Hoya, Inc. 1,400 83,512 Ito En, Ltd. 2,000 106,083 Itochu Techno-Science Corp. 1,300 87,837 Matsushita Electric Indl. Co. 5,000 59,162 NEC Corporation 5,000 45,289 Nintendo Company, Ltd. 700 107,846 NTT Docomo, Inc. 14 189,645 Takeda Chemical Industries, Ltd. 2,000 96,781 Takefuji Corp. 1,500 124,362 Yamato Transport Co., Ltd. 3,000 56,183 ------------ 1,052,665 Korea - 1.35% Korea Telecom Corporation 10,400 216,736 ------------ Mexico - 1.86% Cemex 2,950 67,850 Grupo Televisa SA* 1,700 51,765 Wal-Mart de Mexico SA 3,455 177,587 ------------ 297,202 Netherlands - 1.69% Aegon NV 4,800 120,454 Koninklijke Ahold NV 5,350 150,425 ------------ 270,879 Portugal - 1.31% Brisa Auto-Estradas de Portugal SA 23,625 210,370 ------------ Singapore - 0.31% Flextronics International* 2,525 50,248 ------------ Spain - 2.04% Banco Santander Central Hispano SA 15,625 120,161 Gas Natural SDG, SA 4,425 79,402 Industria de Diseno Textil SA* 6,825 127,072 ------------ 326,635 Sweden - 1.55% Forenings Sparbanken AB 9,000 90,279 Securitas AB 9,425 156,834 ------------ 247,113 Switzerland - 3.91% Nestle SA* 890 184,498 Serono SA 218 172,102 STMicroelectronics NV SA 2,550 72,019 Synthes-Stratec, Inc. 144A* 300 197,969 ------------ 626,588 Taiwan - 0.63% Taiwan Semiconductor Mfg. Co., Ltd.* 7,860 101,473 ------------
The accompanying notes are an integral part of the financial statements. 76 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- United Kingdom - 11.68% ARM Holding Plc* 14,800 $74,820 Barclays Plc 6,950 208,993 British Energy 6,500 22,993 British Sky Broadcasting Group* 3,625 40,549 British Telecommunications Plc 20,000 101,108 Compass Group Plc 18,450 134,414 GlaxoSmithKline Plc 4,600 123,625 Prudential Plc 10,300 107,732 Reckitt Benckiser Plc 10,300 143,643 Rio Tinto Plc 7,900 128,076 Royal & Sun Alliance Insurance Group 13,000 70,630 Shire Pharmaceuticals Group Plc* 4,900 219,030 TeleWest Communications* 79,850 56,839 Tesco Plc 26,000 91,593 The Sage Group Plc 18,800 57,626 Vodaphone Airtouch Public Plc 124,800 288,262 ------------ 1,869,933 United States - 39.17% Abbott Laboratories 1,300 68,874 Alcoa, Inc. 1,600 51,632 American Express 2,775 81,668 American International Groupa 2,100 165,060 Amgen, Inc.* 1,749 99,378 AOL Time Warner* 1,894 59,112 Bank Of New York 2,009 68,326 Baxter International, Inc. 2,364 114,347 Berkshire Hathaway, Inc.* 75 176,550 Bristol-Myers Squibb Co. 775 41,424 Cisco Systems, Inc.* 6,448 109,100 Citigroup, Inc.* 10,086 459,115 Clear Channel Communications, Inc.* 1,750 66,710 The Coca-Cola Company 2,100 100,548 Comcast Corporation Class A Special* 1,917 68,705 Comverse Technology, Inc.* 1,427 26,842 Federal National Mortgage Assoc. 1,275 103,224 Fifth Third Bancorp 4,146 233,917 FleetBoston Financial Corp. 1,575 51,755 General Electric Co. 12,057 438,995 Goldman Sachs Group, Inc. 1,075 84,022 Home Depot, Inc. 2,276 87,011 Honeywell International, Inc. 2,200 65,010 Intel Corp. 5,643 137,802 International Business Machines 1,625 175,614 Johnson & Johnson 3,500 202,684 Kohl's Corp.* 1,746 97,095 Linear Technology Corp. 4,650 180,420 Merck & Company, Inc. 1,946 124,174 Microsoft Corp.* 5,575 324,186 Morgan Stanley Dean Witter and Co. 925 45,251 Omnicom Group 570 43,765 Oracle Systems Corp.* 7,342 99,558
Shares Value ------ ----- United States - continued Pepsico, Inc. 2,550 $124,211 Pfizer, Inc. 7,896 330,842 Philip Morris Companies, Inc. 1,500 70,200 Qualcomm, Inc.* 3,925 192,796 Solectron Corp.* 6,775 83,333 Sun Microsystems, Inc.* 6,098 61,895 Texas Instruments, Inc. 6,300 176,337 Tyco International, Ltd. 3,731 183,341 Veritas Software Corp.* 7,275 206,465 Viacom, Inc., Class B* 4,348 158,745 Wal-Mart Stores, Inc. 49,850 118,831 Walt Disney Co. 2,150 39,969 Washington Mutual, Inc. 4,687 141,501 Wells Fargo 3,375 133,313 ------------ 6,273,653 TOTAL COMMON STOCKS (Cost $17,139,774) $15,468,091 ------------ SHORT TERM INVESTMENTS - 0.01% SSgA Money Market Fund (Cost $1,000) 1,000 $1,000 ------------ Principal Value --------- ----- SHORT TERM COMMERCIAL PAPER - 3.42% Ciesco, L.P., 2.60% due 11/01/01 (Cost $548,000) $548,000 $548,000 ------------ TOTAL INVESTMENTS (Global Equity Fund) (Cost $17,688,774) $16,017,091 ------------ - ------------------------------------------------------ Global Equity Fund - ------------------------------------------------------ MAJOR INDUSTRIES Computers (Software & Services) 6.89% Healthcare (Drugs Major Pharms) 5.26% Financial (Diversified) 4.97% Electrical Equipment 4.80% Healthcare (Diversified) 4.76% Electronics (Semiconductors) 4.64% Telecommunications (Cellular/Wireless) 4.52% Engineering & Construction 3.83% Banks (Money Center) 3.75% Beverages (Non-Alcoholic) 3.33% All other 53.25% ------------ Total 100.00% ------------ - ------------------------------------------------------ International Equity Fund - ------------------------------------------------------ Shares Value ------ ----- COMMON STOCKS - 88.03% Australia - 1.34% Amcor, Ltd. 2,417 $8,010 AMP Limited 2,323 21,087 AMP, Ltd.* 540 0
The accompanying notes are an integral part of the financial statements. 77 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Australia - continued Australian Gas & Light 1,236 $5,520 BHP, Ltd. 9,226 41,433 Brambles Industries, Ltd. 2,936 16,082 Coca Cola Amatil, Ltd. 4,800 12,115 Coles Myer, Ltd. 2,945 11,271 Commonwealth Bank Of Australia 2,414 36,177 CSL, Ltd. 345 8,730 CSR, Ltd. 3,252 10,320 Foster's Brewing Group, Ltd. 5,994 14,593 Goodman Fielder, Ltd. 3,878 2,750 Leighton Holdings, Ltd. 889 4,422 Lend Lease Corp. 1,092 6,119 Mayne Nickless, Ltd. 2,273 8,516 MIM Holdings, Ltd. 2,405 1,185 National Australia Bank 3,483 53,546 News Corporation, Ltd. 5,395 31,955 Normandy Mining, Ltd. 6,504 4,579 Onesteel, Ltd. 796 403 Orica, Ltd. 938 2,179 Pacific Dunlop, Ltd. 3,433 1,416 Paperlinx, Ltd. 419 883 QBE Insurance Group 1,327 4,625 Rio Tinto Limited 672 10,817 Santos, Ltd. 2,037 6,515 Southcorp, Ltd. 2,044 7,493 Suncorp Metway 1,030 6,939 Tabcorp Holdings, Ltd. 1,060 5,320 Telstra Corp 24,653 61,618 Wesfarmers, Ltd. 857 12,843 Westpac Banking Corp. 3,092 23,014 WMC, Ltd. 5,835 27,378 Woolworths, Ltd. 3,701 21,106 ------------ 490,959 Belgium - .06% KBC Bancassurance Holding SA 446 12,235 Solvay SA 66 3,547 Union Chimique Belge 158 6,014 Umicore SA 22 828 ------------ 22,624 Denmark - .16% Carlsberg AS Series A 100 3,829 Carlsberg 100 4,252 Danisco 200 7,392 Danske Bank 1,200 17,755 Novo Nordisk AS* 500 20,261 TDC A/S 200 6,860 ------------ 60,349 Finland - .89% Hartwall Oyj 467 8,548 Kesko Corp 1,571 13,071 Metso Corp 871 8,500 Nokia (Ab) Oyj 10,169 212,473 Outokumpu Oyj 506 4,096
Shares Value ------ ----- Finland - continued Raisio Group Oyj 1,459 $1,286 Sampo Oyj 2,480 22,306 Sonera Corp 3,315 18,844 Tietoenator Corp 546 12,228 UPM-Kymmene Oyj 559 18,151 Wartsila Oyj 372 6,692 ------------ 326,195 France - 11.73% Accor SA 1,621 50,841 Alcatel 3,739 56,398 Aventis SA 5,321 391,253 AXA 5,780 126,331 Beghin Say* 328 11,211 BNP Paribas 1,402 116,519 Bouygues 3,094 94,619 Cap Gemini SA 425 23,892 Carrefour 3,493 178,610 Casino Guichard Perrachon 549 41,059 Cerestar* 328 9,116 Cerol* 328 7,850 Cie de St Gobain 478 66,425 Cie Generale des Estabissement 455 14,050 Dassault Systemes 128 5,107 Fonciere Lyonnaise 655 16,025 France Telecom SA 4,402 164,195 Gecina 120 9,153 Groupe Danone 1,901 219,716 Imerys 23 2,042 Klepierre 160 14,823 Lafarge 228 20,241 Lagardere S.C.A. 718 25,303 L'Air Liquide 190 25,600 L'Oreal 4,089 282,091 Louis Vuitton Moet Hennessy 2,900 102,171 Pechiney SA 302 13,853 Pernod Ricard 681 47,624 Peugeot SA 942 38,255 Pinault Printemps Redoute 796 91,572 Provimi* 328 4,582 Sagem SA 59 2,746 Sanofi Synthelabo 4,990 328,765 Schneider Electric SA 849 33,966 SILIC* 50 6,993 SIMCO 320 22,148 Societe Generale 1,490 74,447 Sodexho Alliance SA 816 38,386 Sophia SA* 495 13,749 St Microelectronics 3,164 89,360 STE BIC 482 14,788 Suez Lyonnaise des Eaux 4,865 152,847 Technip-Coflexip* 73 8,247 Thales (Ex-Thomson-CDF) 1,073 41,220 Total Fina Elf SA 6,914 970,132
The accompanying notes are an integral part of the financial statements. 78 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- France - continued Unibail SA 900 $46,587 Usinor 2,207 23,226 Vivendi Universal 3,653 170,527 ------------ 4,308,659 Germany - 5.81% Adidas Salomon AG 200 11,279 Allianz AG 1,410 332,021 BASF AG 1,100 37,201 Bayer AG 1,500 44,523 Bayerische Hypo-und Vereinsbank 2,000 61,648 Beiersdorf AG 1,150 129,244 Bilfinger & Berger 150 2,847 Continental AG 400 4,069 Daimlerchrysler AG 3,350 116,760 Deutsche Bank AG 2,300 127,827 Deutsche Telekom AG 13,138 203,134 Douglas Holding AG 450 10,645 E. On AG 6,620 344,757 EM & TV Merchandising* 250 506 Fresenius Medical Care 200 12,389 Heidelberg Zement AG 234 9,703 IVG Holding AG 1,363 15,263 Kamps AG 300 2,186 Karstadt Quelle AG 500 16,055 Linde AG 650 25,993 Lufthansa AG 800 8,419 Man AG 500 8,761 Merck KGAA 627 22,079 Metro AG 1,850 60,752 Muenchener Rueckversicherungs 850 224,390 Preussag AG 850 20,589 Schering AG 800 41,267 Siemens AG 3,815 184,712 Thyssenkrupp AG 1,000 10,793 Volkswagen AG 1,050 40,232 WCM Beteiligungs&Grundbesitz 333 3,924 ------------ 2,133,968 Hong Kong - 1.64% Bank Of East Asia, Ltd. 12,351 24,702 Cathay Pacific Air, Ltd. 17,000 17,109 CLP Holdings, Ltd. 12,000 45,231 Esprit Holdings, Ltd. 1,017 1,069 Hang Lung Development Co. 4,000 3,359 Hang Seng Bank 7,200 72,231 Henderson Land Development 6,000 19,269 Hong Kong & China Gas, Ltd. 27,170 33,963 Hong Kong & Shanghai Hotels, Ltd. 500 167 Hopewell Holdings, Ltd. 1,000 474 Hutchison Whampoa, Ltd. 19,100 154,269 Hysan Development 3,113 2,554 Johnson Electric Holdings, Ltd. 18,000 15,692 Li & Fung, Ltd. 56,000 53,487 New World Development Co. 13,338 9,149
Shares Value ------ ----- Hong Kong - continued Pacific Century Cyberworks, Ltd.* 77,815 $20,701 Shangri-la Asia, Ltd. 12,000 6,923 Sino Land Co. 15,416 4,101 South China Morning Post 4,000 2,115 Sun Hung Kai Properties 11,000 67,692 Swire Pacific, Ltd. 7,000 29,167 Wharf Holdings, Ltd. 11,000 20,308 ------------ 603,732 Ireland - 0.11% Allied Irish Banks 700 6,800 CRH Plc 435 6,741 Green Property Co. 4,000 21,875 Jefferson Smurfit Group Plc 840 1,670 Kerry Group Plc 154 1,961 ------------ 39,047 Italy - 3.62% Assicurazione Generali 4,992 136,722 Autogrill SpA 962 7,701 Banca Intesa SpA 17,952 41,982 Banca Populare de Milano 725 2,537 Banca di Roma* 2,215 4,921 Benetton Group SpA 789 7,742 Beni Stabili SpA 28,800 12,926 ENEL Societa Per Azioni 22,494 126,654 Ente Nazionale Idrocarburi SpA 30,141 377,376 Fiat SpA 348 3,897 Impregilo SpA* 1,043 447 Italcementi 212 1,472 Italgas 2,021 17,142 Mediaset 4,197 27,369 Mediobanca SpA 1,701 18,130 Parmalat Finanzlaria 7,371 19,691 Pirelli SpA 10,365 15,942 Riunione Adriatica de Sicurta 2,335 27,996 Rinascente per L'Esercizio 1,004 3,549 Societa Assicuratrice Industrial 280 3,365 San Paolo IMI SpA 5,117 53,711 SNIA SpA 1,316 1,468 Telecom Italia Mobile SpA ORDS 39,304 213,879 Telecom Italia Mobile SpA RISP 1,209 5,850 Telecom Italia SpA 15,759 131,397 Unicredito Italian 17,336 63,931 ------------ 1,327,797 Japan - 22.86% Acom Co., Ltd. 800 66,718 Advantest Corp. 500 25,705 Aeon Co., Ltd. 4,000 85,683 Ajinomoto Co., Inc. 7,000 75,686 Alps Electric Co. 1,286 8,143 Amada Co. 3,000 13,538 Asahi Bank 8,000 7,964 Asahi Breweries 4,000 41,715 Asahi Glass Co. 12,000 64,433
The accompanying notes are an integral part of the financial statements. 79 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Japan - continued Asahi Kasei Co. 5,000 $16,443 Asatsu DK 300 5,729 Bank of Fukuoka 2,000 7,948 Bank of Yokohama 3,000 10,674 Benesse Corp. 1,100 33,930 Bridgestone Corp. 7,000 65,919 Canon, Inc. 5,000 145,253 Central Japan Railway 9 62,867 Chugai Pharmaceutical Co., Ltd. 2,000 29,197 Chuo Mitsui Trust & Banking Co. 13,000 16,973 Citizen Watch Co. 4,000 21,053 Cosmo Oil Company 3,000 5,949 Credit Saison Co., Ltd. 300 7,173 Dai Nippon Ink & Chemicals, Inc. 1,000 1,852 Dai Nippon Printing Co., Ltd. 7,000 74,487 Daiei, Inc.* 2,000 1,975 Daito Trust Construction 1,400 23,934 Daiwa Bank, Ltd.* 6,000 6,218 Daiwa House Industries Co., Ltd. 5,000 33,702 Daiwa Securities Group, Inc. 8,000 52,226 Denki Kagaku Kogyo 2,000 4,129 Denso Corp. 5,000 71,810 East Japan Railway 18 104,729 Eisai Co. 1,000 25,542 Fanuc, Ltd. 2,300 95,720 Fuji Machine Mfg. 300 3,892 Fuji Photo Film Co. 5,000 164,837 Fuji Software ABC 200 8,389 Fujikura, Ltd. 2,000 8,846 Fujitsu, Ltd. 11,000 81,325 Furukawa Electric Co. 3,000 17,283 Gunma Bank 2,000 9,156 Hirose Electric 300 21,984 Hitachi, Ltd. 17,000 115,835 Honda Motor Co. 4,000 143,294 Hoya Corp. 500 29,826 Ishihara Sangyo Kaisha, Ltd.* 5,000 8,487 Ishikawajima-Harima Heavy Industries 4,000 7,377 Itochu Corp. 7,000 20,507 Ito-Yokado Co. 2,000 88,131 Japan Air Lines Co. 6,000 14,688 Japan Energy Corp. 5,000 8,446 Japan Tobacco, Inc. 4 26,113 JGC Corp. 1,000 7,099 Joyo Bank, Ltd. 3,000 8,568 Kadokawa Shoten Publishing 200 3,134 Kajima Corp. 19,000 62,793 Kaneka Corp. 1,000 6,928 Kansai Electric Power, Inc. 12,400 204,904 Kao Corp. 7,000 165,653 Kawasaki Heavy Industries* 4,000 4,113 Kawasaki Kisen Kaisha, Ltd. 1,000 1,379 Kawasaki Steel Corp. 15,000 15,056
Shares Value ------ ----- Japan - continued Keihin Electric Express Railway 1,000 $4,260 Kinki Nippon Railway 23,000 85,773 Kirin Brewery Co. 16,000 121,686 Komatsu, Ltd. 8,000 24,416 Konami Corp. 400 12,436 Kubota Corp. 3,000 9,499 Kuraray Co., Ltd. 1,000 6,234 Kyocera Corp. 1,100 74,773 Kyowa Hakko Kogyo Co., Ltd. 1,000 5,859 Marubeni Corp.* 8,000 8,878 Marui Co. 2,000 27,043 Matsushita Electric Industrial 15,000 177,486 Meitec Corp. 300 7,834 Mitsubishi Chemical Corp. 18,000 38,484 Mitsubishi Corp. 8,000 61,235 Mitsubishi Electric Corp. 21,000 75,401 Mitsubishi Estate Co., Ltd. 8,000 78,143 Mitsubishi Heavy Industries, Ltd. 31,000 104,223 Mitsubishi Materials Corp. 6,000 9,009 Mitsubishi Paper Mills, Ltd. 5,000 7,711 Mitsubishi Rayon Co., Ltd. 1,000 2,579 Mitsubishi Tokyo Financial Group* 17 126,239 Mitsui & Co. 8,000 47,134 Mitsui Engineering & Shipbuilding* 1,800 2,306 Mitsui Fudosan Co., Ltd. 5,000 50,716 Mitsui Mining & Smelting Co., Ltd. 1,000 3,003 Mitsui Sumitomo Insurance Co. 10,180 56,489 Mitsukoshi, Ltd. 2,000 6,887 Mizuho Holdings, Inc. 26 78,502 Murata Manufacturing Co. 1,600 100,273 NEC Corp. 11,000 99,637 NGK Insulators, Ltd. 2,000 16,190 Nichiei Co. 600 4,926 Nidec Corporation 300 11,702 Nikon Corp. 3,000 23,036 Nintendo Co. 1,200 184,879 Nippon Express Co. 12,000 43,380 Nippon Mitsubishi Oil 23,000 122,371 Nippon Sheet Glass Co. 4,000 16,288 Nippon Shinpan Co., Ltd.* 4,000 5,549 Nippon Steel Corp. 39,000 52,193 Nippon Suisan Kaisha, Ltd. 8,000 14,232 Nippon Telegraph & Telephone Corp. 71 292,007 Nippon Unipac Holding 4 19,911 Nippon Yusen 4,000 13,644 Nissan Motor Co., Ltd. 18,000 79,318 Nisshinbo Ind., Inc. 5,000 23,257 Nissin Food Products Co., Ltd. 100 2,093 Nitto Denko Corp. 1,100 18,671 Nomura Holdings 12,000 157,656 Noritake Co. 1,000 4,219 NSK, Ltd. 9,000 29,965 NTN Corp. 3,000 5,777
The accompanying notes are an integral part of the financial statements. 80 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Japan - continued Obayashi Corp. 3,000 $12,950 Oji Paper Co. 11,000 53,678 Omron Corp. 2,000 25,460 Onward Kashiyama Co, Ltd. 2,000 19,927 Orient Corp.* 5,000 5,467 Oriental Land Co., Ltd. 400 29,540 Orix Corp. 300 26,219 Osaka Gas Co. 24,000 72,463 Penta-Ocean Construction 1,800 2,482 Promise Co., Ltd. 800 51,703 Rohm Co., Ltd 700 74,430 Sankyo Co. 3,000 58,264 Sanrio Co. 400 3,476 Sanyo Electric Co. 19,000 90,546 Secom Co. 1,000 51,981 Seiyu, Ltd.* 2,000 5,043 Sekisui Chemical Co., Ltd. 1,000 2,848 Sekisui House, Ltd. 8,000 64,368 Sharp Corp. 8,000 82,647 Shimizu Corp. 1,000 4,398 Shinetsu Chemical Co. 2,000 65,772 Shionogi & Co. 1,000 17,871 Shiseido Co. 2,000 19,764 Shizuoka Bank 2,000 14,786 Showa Denko KK* 4,000 4,700 Showa Shell Sekiyu 2,000 13,954 SMC Corp. 700 60,264 Softbank Corporation 2,500 53,450 Sony Corp. 5,400 204,023 Sumitomo Chemical 9,000 34,298 Sumitomo Corp. 5,000 29,214 Sumitomo Electric Industries, Ltd. 3,000 25,411 Sumitomo Metal Industries, Ltd.* 12,000 5,288 Sumitomo Metal Mining Co., Ltd. 2,000 6,528 Sumitomo Mitsui Banking Corp. 16,000 98,837 Taiheiyo Cement Corp. 1,000 2,097 Taisei Corp. 2,000 5,957 Taisho Pharmaceutical Co. 3,000 59,366 Taiyo Yuden Co., Ltd. 1,000 13,513 Takeda Chemical Industries 4,000 193,562 Takefuji Corp. 900 74,617 Takuma Co., Ltd. 3,000 25,191 Teijin, Ltd. 3,000 11,873 Terumo Corp. 1,900 31,397 TIS, Inc. 300 8,054 Tobu Railway Co. 2,000 5,973 Tohoku Electric Power 6,600 116,063 Tokio Marine & Fire Insurance Co. 8,000 65,347 Tokyo Broadcasting System, Inc. 1,000 16,729 Tokyo Dome Corp.* 2,000 5,174 Tokyo Electric Power 14,700 364,666 Tokyo Electron, Ltd. 800 32,837 Tokyo Gas Co. 9,000 27,982
Shares Value ------ ----- Japan - continued Tokyu Corp. 2,000 $9,009 Toppan Printing Co. 4,000 37,178 Toray Industries, Inc. 6,000 16,500 Toshiba Corp. 16,000 59,146 Tosoh Corp. 2,000 3,786 Toto, Ltd. 1,000 4,978 Toyo Seikan Kaisha, Ltd. 2,000 26,031 Toyobo Co. 2,800 4,113 Toyota Motor Corp. 19,200 465,331 Trans Cosmos, Inc. 100 2,693 Ube Industries 8,000 12,665 World Co., Ltd. 200 6,691 Yamanouchi Pharmaceutical, Co. 2,000 59,244 Yokogawa Electric Corp. 1,000 7,385 ----------- 8,395,673 Netherlands - 6.24% ABN AMRO Holding NV 5,553 84,709 Aegon NV 5,084 127,581 Ahold NV 3,810 107,125 Akzo Nobel NV 575 23,558 ASM Lithography* 1,972 28,379 Buhrmann NV 575 3,625 Corio 1,041 22,331 Elsevier NV 2,932 34,046 Eurocommercial Property 400 6,476 Getronics NV 1,865 4,965 Hagemeyer 519 7,422 Heineken NV 4,931 181,177 ING Groep NV 6,834 170,267 KPN NV 2,841 10,988 OCE NV 117 897 Philips Electronics NV 3,944 89,537 Rodamco Continental Europe 830 29,354 Royal Dutch Petroleum Co. 17,328 880,590 TNT Post Groep NV 3,001 58,628 Uni Invest NV 547 5,215 Unilever NV 7,298 382,035 Vedior NV 452 4,147 Wolters Kluwer NV 1,313 27,540 ----------- 2,290,595 New Zealand - .01% Carter Holt Harvey, Ltd. 3,731 2,200 Telecom Corp. of NZ 1,359 2,595 ----------- 4,795 Norway - .04% Elkem AS 100 1,629 Norske Skogsindust 100 1,562 Orkla SA 800 13,304 ----------- 16,495 Portugal - 0.37% Banco Comercial Portugues SA* 6,284 24,869 Banco Espirito Santo 393 4,843 BPI SGPS SA 3,576 7,719
The accompanying notes are an integral part of the financial statements. 81 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Portugal - continued Brisa Auto Estrada de Portugal 2,155 $19,189 Electricidade de Portugal 23,405 56,208 Jeronimo Martins SGPS SA* 565 3,781 Portugal Telecom SGPS* 2,352 18,616 Pt Multimedia.com* 246 454 Sonae Investmentos SA 1,660 1,105 ------------ 136,784 Singapore - 0.65% Capitaland, Ltd. 8,000 6,056 Chartered Semiconductors Mfg., Ltd.* 1,000 1,920 City Developments, Ltd. 4,000 9,084 Creative Technology, Ltd. 100 598 Cycle & Carriage, Ltd. 2,000 3,127 DBS Group Holdings, Ltd. 5,815 33,173 First Capital Corp. 2,000 1,130 Fraser & Neave, Ltd. 2,000 7,515 Hotel Properties, Ltd. 5,000 3,291 Keppel Corp. 3,000 5,200 Neptune Orient Lines, Ltd.* 4,000 1,733 OverSeas Chinese Banking, Ltd. 5,400 31,102 Parkway Holdings, Ltd. 6,000 3,143 Sembcorp Industries, Ltd. 11,000 9,111 Singapore Airlines 7,000 32,446 Singapore Press Holdings 2,000 17,334 Singapore Technologies Engineering 18,000 20,340 Singapore Telecommunications, Ltd. 22,900 21,731 United Overseas Bank, Ltd. 4,336 24,260 United Overseas Land, Ltd. 4,000 3,357 UTD Industrial CP 9,000 3,357 ------------ 239,006 Spain - 3.05% Acerinox SA 83 2,597 Acs Actividades de Construccion 441 10,611 Aguas De Barcelona 1,343 17,032 Altadis SA 2,468 40,512 Autopistas Concessionaria Espanol 2,270 20,867 Banco Bilbao Vizcaya Argentaria 11,545 129,075 Banco Santander Central Hispano 12,306 94,637 Corp Mapfre SA 1,572 8,583 Ebro Puleva SA 267 2,462 Endesa S.A. 9,092 139,023 Fomento de Construcciones & Contra SA 671 14,455 Gas Natural SDG 4,217 75,670 Grupo Dragados SA 1,064 12,910 Iberdrola SA 8,478 116,442 Inmobiliaria Colonial 1,641 18,081 Metrovacesa SA 2,171 28,978 Puleva Biotech* 359 0 Repsol YPF SA 7,362 106,610 Sol Melia SA 799 5,426 Telefonica SA* 15,844 190,107 Telepizza SA* 1,849 3,176 Union Electrica Fenosa 2,816 41,817
Shares Value ------ ----- Spain - continued Vallehermoso SA 5,968 $38,166 Zardoya Otis SA 389 3,499 ------------ 1,120,734 Sweden - 1.99% Assidomaen AB 159 4,040 Atlas Copco Series A 800 16,275 Atlas Copco Series B 500 9,539 Castellum AB 990 10,163 Drott AB 530 5,143 Electrolux AB 3,300 39,599 Ericsson Telefon AB 35,050 151,807 Hennes & Mauritz AB 8,000 139,872 JM AB 500 10,078 Nordea AB 6,813 30,083 Om AB 800 8,587 Sandvik AB 1,800 37,968 Securitas AB 4,000 66,561 Skandia Insurance A 5,400 32,399 Skandinaviska Enskilda Banken 1,900 14,517 Skanska/Frueher AB 3,200 17,100 SKF AB 600 10,069 SSAB Swedish Steel 200 1,641 Svenska Cellulosa AB 523 11,816 Svenska Handelsbanken Series A 2,600 32,052 Swedish Match AB 1,800 9,281 Tele2 AB* 400 12,318 Telia AB 4,350 19,044 Trelleborg AB 900 6,033 Volvo Series A 300 3,980 Volvo Series B 1,300 18,037 Wihlborgs Fastigheter AB 4,050 5,050 Wm-Data Nordik AB 3,300 6,528 ------------ 729,578 Switzerland - 8.68% ABB Ltd 4,748 40,358 Adecco SA 1,300 57,476 Credit Suisse Group* 4,120 150,409 Givaudan AG 25 7,644 Holcim Ltd. 55 2,186 Holcim Ltd., Bearer 25 4,808 Nestle SA* 4,960 1,028,215 Novartis AG 22,000 822,663 Roche Holdings 1,800 136,489 Roche Holdings AG 5,800 401,669 Sulzer AG 10 1,192 Sulzer Medica 20 465 Swatch Group AG* 290 22,433 Swiss Reinsurance 1,220 125,335 Swisscom AG 319 88,465 Syngenta Novartis AG* 176 8,987 UBS AG* 4,486 208,348 Valora Holding AG 33 5,267
The accompanying notes are an integral part of the financial statements. 82 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Switzerland - continued Zurich Financial Services Group 333 $76,159 ------------ 3,188,567 United Kingdom - 23.73% 3I Group Plc 2,567 27,670 Abbey National Plc 6,060 90,058 Amersham Plc 4,059 35,792 Amvescap Plc 2,440 29,066 ARM Holdings Plc* 4,594 23,225 Astrazeneca Plc 11,500 518,055 BAA Plc 6,753 53,906 BAE Systems Plc 17,614 85,463 Barclays Plc 7,672 230,704 BG Group Plc 22,992 86,925 BOC Group Plc 1,680 22,819 Boots Co Plc 4,745 41,703 BP Amoco Plc 171,497 1,382,693 Brambles Industries* 3,917 19,646 British Airways Plc 9,237 19,994 British American Tobacco Plc 19,850 173,017 British Land Co Plc 6,890 44,541 British Sky Broadcasting Group* 8,194 91,656 British Telecommunication Plc 52,919 267,527 Bunzl Plc 266 1,662 Cadbury Schweppes Plc 17,189 106,874 Canary Wharf Group Plc* 2,788 17,932 Capita Group Plc 5,661 35,773 Carlton Comunications Plc 3,443 9,553 Centrica Plc 21,867 69,568 CGNU Plc 10,250 122,844 Chelsfield Plc 4,401 16,846 Compass Group Plc 14,067 102,482 Corus Group Plc* 2,320 1,862 Derwent Valley Holdings 150 1,515 Diageo Plc 30,355 302,724 Dixons Group 10,577 32,421 EMI Group Plc 3,741 15,149 GKN Plc 3,917 15,122 GlaxoSmithKline Plc 47,634 1,280,162 Granada Plc 14,067 26,617 Grantchester Holdings Plc 5,019 12,322 Great Portland Estates Plc 2,542 9,103 Great Universal Stores Plc 6,815 48,214 Hammerson Plc 2,310 15,470 Hanson Plc 925 6,329 Hays Plc 10,789 25,822 HBSO 10,458 117,741 Hilton Group Plc 13,153 33,820 HSBC Holdings Plc 39,399 431,265 Imperial Chemical Industries Plc 1,458 6,862 International Power Plc* 4,630 14,864 Invensys Plc 25,950 23,749 Johnson Matthey Plc 118 1,554 Kingfisher Plc 7,402 34,409
Shares Value ------ ----- United Kingdom - continued Land Securities Plc 4,934 $59,563 Lattice Group Plc 22,992 51,687 Legal & General Group Plc 25,490 55,914 Lloyds TSB Group Plc 22,603 227,878 Logica Plc 1,748 18,893 Marconi Plc 7,322 3,054 Marks & Spencer Plc 17,517 73,033 Misys Plc 3,189 12,045 National Grid Grp Plc 8,655 61,357 P&O Princess Cruises Plc 3,669 13,045 P & O Steam Plc 3,669 11,140 Pearson Plc 2,608 31,181 Prudential Plc 8,334 87,169 Psion Plc 724 563 Railtrack Group Plc# 2,932 43 Reed International Plc 4,827 39,479 Rentokil Initial Plc 11,888 42,743 Reuters Group 6,770 64,024 Rexam Plc 283 1,509 Rio Tinto Plc 2,058 33,365 RMC Group Plc 180 1,658 Royal Bank of Scotland Group Plc 10,734 256,510 Sage Group Plc 5,860 17,962 Sainsbury(J) Plc 11,102 60,641 Schroders Plc 1,313 13,543 Scottish Power Plc 10,785 61,886 Six Continents Plc 6,941 63,020 Slough Estates Plc 1,970 9,916 Smith & Nephew Plc 2,543 14,287 Tate & Lyle Plc 1,889 8,109 Tesco Plc 40,697 143,367 Unilever Plc 25,564 185,499 United Utilities Plc 4,423 39,965 Vodafone Group Plc 314,130 725,576 Woolworths Group Plc 8,493 4,472 WPP Group Plc 4,044 36,570 ------------ 8,715,751 TOTAL COMMON STOCKS (Cost $44,848,648) $34,151,306 ------------ PREFERRED STOCKS - 1.16% Australia - 0.11% News Corporation Ltd 6,119 $42,097 ------------ Germany - 1.00% Dyckerhoff AG 50 640 RWE AG (Neu) 4,550 179,661 SAP AG 1,750 181,014 Volkswagen AG 300 7,663 ------------ 368,978 Italy - 0.05% Fiat SpA 1,107 18,022 ------------
The accompanying notes are an integral part of the financial statements. 83 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Spain - 0.00% Telefonica S A* 9 $320 ----------- TOTAL PREFERRED STOCKS (Cost $562,019) $429,417 ----------- WARRANTS - 0.00% Australia - 0.00% QBE Insurance* 265 $0 France - 0.00% SIMCO* 80 410 Switzerland - 0.00% Swiss Reinsurance* 1,220 0 ----------- TOTAL WARRANTS (Cost $0) $410 ----------- COMMON STOCK UNIT - 0.06% Australia - 0.06% AMP Diversified Property Trust 1,277 $1,650 General Property Trust 4,395 6,233 Stockland Trust GP 1,368 3,045 Westfield Trust 5,475 9,582 ----------- TOTAL COMMON STOCK UNIT (Cost $19,923) $20,510 ----------- SHORT TERM INVESTMENTS - 0.00% SSgA Money Market Fund (Cost $1,000) 1,000 $1,000 ----------- Principal Value --------- ----- REPURCHASE AGREEMENTS - 5.80% Repurchase Agreement with State Street Bank & Trust Co, dated 10/31/01 at 2.52%, to be repurchased at $2,129,147 on 11/01/01, collateralized by U.S. Government Securities (Cost $2,129,000) $ 2,129,000 $2,129,000 ----------- TOTAL INVESTMENTS (International Equity Fund) (Cost $47,560,590) $36,731,643 ----------- - -------------------------------------------------------------------------------- International Equity Fund - -------------------------------------------------------------------------------- MAJOR INDUSTRIES Personal Products 12.79% Office Electronics 11.45% Banks 9.82% Food Products 5.99% Electrical Utilities 4.90% Insurance 4.79% Diversified Telecommunication 4.44% Wireless Telecommunication 2.99%
Household Durables 2.85% Automobiles 2.64% Other 37.34% ------------ Total 100.00% ------------ - -------------------------------------------------------------------------------- International Small Cap Fund - ---------------------------------------------------------------------------------
Shares Value ------ ----- COMMON STOCKS - 74.27% Australia - 1.88% BRL Hardy, Ltd. 6,750 $36,502 Corporate Express- Australia 5,900 14,720 Globe International, Ltd.* 32,100 30,672 Healthscope, Ltd. 6,075 7,699 OneSteel, Ltd. 56,675 28,701 Orica, Ltd. 24,475 56,865 QBE Insurance Group, Ltd. 3,705 12,912 ------------ 188,071 Belgium - 0.53% Omega Pharma SA 1,275 53,383 ------------ Canada - 5.06% Air Canada, Inc.* 19,750 32,859 CryptoLogic, Inc.* 5,225 69,702 Ensign Resource Service Group, Inc. 1,850 15,272 Four Seasons Hotels 1,500 57,360 Genesis Microchip, Inc.* 625 28,881 Penn West Petroleum, Ltd.* 1,225 30,648 Precision Drilling Corporation* 1,775 45,337 QLT, Inc.* 3,150 72,259 Research In Motion, Ltd.* 5,175 84,145 Rio Alto Exploration, Ltd.* 1,425 22,397 Stantec, Inc.* 1,075 16,733 Stuart Energy Systems* 1,575 6,352 Vincor International, Inc.* 800 8,873 WestJet Airlines, Ltd.* 1,400 14,558 ------------ 505,376 China - 2.12% Beijing Capital Int'l. Airport Co., Ltd. 342,000 83,746 Nanjing Panda Electronics Co., Ltd.* 270,000 100,385 Travelsky Technology, Ltd.* 36,000 27,000 ------------ 211,131 Denmark - 0.21% Radiometer AS- Class B Shares 875 20,714 ------------ Finland - 1.60% Comptel Oyj SA 144A 11,550 33,763 Elisa Communications Oyj 8,000 88,146 Stonesoft Oyj SA* 16,200 37,739 ------------ 159,648 France - 7.06% Beghin-Say* 1,350 46,142 Bouygues Offshore SA 675 23,587 Business Objects SA* 2,200 61,145
The accompanying notes are an integral part of the financial statements. 84 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- France - continued Devoteam SA* 1,375 $23,721 Eurodisney SA* 18,050 12,501 Eurotunnel SA* 122,775 86,135 Galeries Lafayette SA 550 70,000 Infogrames Entertainment SA* 5,325 51,296 Medidep SA* 1,525 25,184 Net2 SA* 8,575 42,420 NRJ Group 2,025 29,689 Silicon-On-Insulator Technologies* 8,375 111,487 UBI Soft Entertainment* 1,875 63,732 Wavecom SA* 2,000 57,565 ------------ 704,604 Germany - 4.35% Articon-Integralis AG* 2,925 25,520 AWD Holding AG 1,000 27,550 Balda AG 3,550 25,544 Evotec Biosystems AG* 625 5,734 Funkwerk AG* 1,275 29,817 JUMPtec Industrielle Computertechnik* 4,225 30,401 Kontron Embedded Computers AG* 1,000 12,412 Lion Bioscience AG* 50 787 LPKF Laser & Electronics 525 2,574 Medion AG 350 12,246 Phenomedia AG* 1,425 16,278 Puma AG Ord 144A 2,200 53,032 Schwarz Pharma AG 2,725 69,486 Stada Arzneimittel AG 4,000 110,812 UMS United Medical Systems* 1,050 12,041 ------------ 434,234 Greece - 0.30% Folli-Follie 1,750 30,159 ------------ Hong Kong - 6.44% China Insurance International Hldg. 146,000 70,192 China Merchants Holdings Int'l Co. 110,000 69,808 China Resources Beijing Land, Ltd. 302,000 77,436 China Resources Enterprises 60,000 60,000 Denway Motors, Ltd. 190,000 63,333 Hang Lung Development Co. 68,000 57,103 Henderson Investment, Ltd. 37,000 26,801 Hong Kong Exchang. & Clearing, Ltd. 34,000 45,769 i-CABLE Communications, Ltd.* 96,000 52,923 Qingling Motors Company, Ltd.* 224,000 39,344 Shanghai Industrial Hold., Ltd. 144A 26,000 43,833 Wah Sang Gas Holdings, Ltd.* 44,000 4,400 Xinao Gas Holdings, Ltd.* 110,000 31,378 ------------ 642,320 India - 1.05% Satyam Computer Services, Ltd. 7,000 46,900 Tata Engineer & Locomotive 144A* 34,800 57,420 ------------ 104,320
Shares Value ------ ----- Ireland - 0.77% IFG Group PLC 4,525 $12,007 Power Leisure PLC 19,675 64,593 ----------- 76,600 Israel - 2.06% BATM Advanced Comm., Ltd.* 99,250 56,230 Emblaze Systems, Ltd.* 20,200 61,183 Taro Pharmaceutical Industries, Ltd.* 2,100 88,410 ----------- 205,823 Italy - 1.49% Autogrill SPA 7,000 56,036 Gruppo Editoriale L'Espresso 19,100 47,072 Lottomatica SPA* 9,400 45,149 ----------- 148,257 Japan - 14.80% Alpha Systems, Inc. 1,000 52,226 Bank of Kyoto, Ltd. 4,000 18,214 CAC Corporation 700 30,446 Don Quijote Co., Ltd. 800 56,469 Drake Beam Morin-Japan, Inc. 600 57,285 Faith, Inc.* 2 70,831 FP Corporation 700 25,705 Goldcrest Company, Ltd. 2,100 118,585 Hokuto Corporation 1,300 56,224 Information Services International-Dents 300 31,825 Kappa Create Co., Ltd. 1,000 58,917 Kirin Beverage Corporation 1,300 25,513 Miyachi Technos Corporation 1,100 19,434 Nippon Systems Development 718 36,854 Nishimatsu Construction Company 22,000 84,916 Nissin Healthcare Food Svc. Co., Ltd.* 3,900 138,439 Nitori Company 1,000 24,073 Ootoya Company, Ltd.* 5,000 104,451 Saizeriya Company, Ltd. 1,400 56,893 Sammy Corporation* 500 13,995 Sanyo Shokai, Ltd. 12,000 60,223 Shinko Electric Industries Co., Ltd. 1,500 24,726 Shohkoh Fund & Co., Ltd. 190 23,319 Star Micronics Co., Ltd. 8,000 56,534 THK Company, Ltd. 6,100 81,436 Tokyo Seimitsu Company, Ltd. 2,900 69,811 Tokyu Land Corporation* 20,000 39,332 United Arrows, Ltd. 1,000 39,904 ----------- 1,476,580 Netherlands - 2.38% Core Laboratories N.V.* 3,050 49,715 Open TV Corp* 1,325 9,752 Teleplan Int'l N.V* 3,725 53,272 Van der Moolen Holding N.V. 5,200 125,113 ----------- 237,852 Norway - 0.87% Tandberg Television ASA* 24,600 86,794 -----------
The accompanying notes are an integral part of the financial statements. 85 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Portugal - 1.86% PT Multimedia 144A* 9,025 $63,398 Telecel Comunicacoes Pessoais 144A* 17,400 122,073 ------------ 185,471 Singapore - 0.60% Creative Technology, Ltd. 10,000 59,790 ------------ Sweden - 5.54% Allgon AB 8,875 54,081 Autoliv 2,900 45,810 Capio AB* 8,400 52,761 Elekta AB* 19,500 154,473 Intentia B 144A* 7,900 36,660 LGP Telecom Holding AB 5,250 29,777 Lindex AB 2,850 31,394 ORC Software AB 4,300 50,389 Song Networks Holding AB* 91,600 48,518 Teleca AB 400 1,684 WM Data AB B Shares 23,725 46,930 ------------ 552,477 Switzerland - 0.29% Actelion Ltd 144A* 250 8,867 Kaba Holding AG 144A 70 15,153 Temenos Group AG* 1,300 4,929 ------------ 28,949 Taiwan - 0.52% ASE Test, Ltd.* 6,300 51,849 ------------ United Kingdom - 12.25% Acambis Plc* 13,550 50,041 Arena Leisure Plc* 47,825 29,388 Capital Radio 1,675 17,268 COLT Telecom Group Plc* 14,500 24,750 Cookson Group Plc 57,050 57,989 Dialog Semiconductor 144A* 4,375 23,217 easyJet Plc* 12,750 69,642 Electronics Boutique Plc 91,950 150,941 Energis Plc* 76,500 79,737 Eyretel Plc* 19,625 20,612 HIT Entertainment 144A 48,075 217,198 Incepta Group Plc 31,000 14,411 Informa Group Plc 2,075 5,121 Marlborough Stirling Plc 20,550 46,272 Medisys Plc* 65,775 59,051 Misys 11,625 43,908 Mothercare Plc 13,600 41,292 Oxford GlycoSciences Plc* 8,350 54,585 Powderject Pharmaceuticals Plc* 1,900 11,565 Serco Group Plc 15,200 80,556 The Innovation Group Plc* 8,900 35,555 Trinity Mirror Plc 5,075 29,011 TTP Communications Plc* 600 1,133 Weston Medical Group Plc* 19,050 58,807 ------------ 1,222,050
Shares Value ------ ----- United States - 0.24% Open TV Corp.* 3,150 $23,625 ------------ TOTAL COMMON STOCKS (Cost $7,428,251) $7,410,077 ------------ RIGHTS & WARRANTS - 0.00% Insurance - 0.00% QBE Insurance, rights expire 11/1/20 3,705 $0 ------------ SHORT TERM INVESTMENTS - 3.02% SSgA Money Market Fund (Cost $301,274) 301,274 $301,274 ------------ Principal Value --------- ----- U.S. GOVT. AGENCY OBLIGATIONS-SHORT TERM - 22.71% Federal Home Loan Mortgage Discount Note, 2.46% due 11/01/01 (Cost $2,266,000) $2,266,000 $2,266,000 ------------ TOTAL INVESTMENTS (International Small Cap Fund) (Cost $9,995,525) $9,977,351 - ---------------------------------------------------------------------------- International Small Cap Fund - ---------------------------------------------------------------------------- MAJOR INDUSTRIES Computers (Software & Services) 11.37% Investment Management 5.49% Services (Commercial & Consumer) 4.40% Healthcare (Medical Products & Suppls) 3.95% Communication Equipment 3.80% Restaurants 3.73% Distributors (Food & Health) 3.22% Computers (Networking) 3.18% Healthcare (Drugs Major Pharms) 3.11% Entertainment 3.10% All other 54.65% ------------ Total 100.00% - ---------------------------------------------------------------------------- Balanced Fund - ---------------------------------------------------------------------------- Shares Value ------ ----- COMMON STOCKS - 63.52% Banks - 2.92% Bank of New York, Inc. 16,500 $561,165 Wells Fargo & Company 18,400 726,800 ------------ 1,287,965 Biotechnology - 1.80% Genentech, Inc.* 15,200 794,200 ------------ Chemicals - 1.45% Dow Chemical Company 19,200 638,400 ------------
The accompanying notes are an integral part of the financial statements. 86 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- Communications Equipment - 2.27% Cisco Systems, Inc.* 26,500 $448,380 Nokia Corp. 26,900 551,719 ------------ 1,000,099 Computers & Peripherals - 0.72% Sun Microsystems, Inc.* 31,300 317,695 ------------ Diversified Financial - 7.07% Citigroup, Inc. 17,900 814,808 Goldman Sachs Group, Inc. 7,400 578,384 J.P. Morgan Chase & Co. 20,200 714,272 Morgan Stanley Dean Witter & Co. 10,800 528,336 Stilwell Financial, Inc. 24,000 482,640 ------------ 3,118,440 Diversified Telecommunications - 3.04% Qwest Communications Int'l., Inc. 27,800 360,010 SBC Communications, Inc. 14,100 537,351 Verizon Communications 8,900 443,309 ------------ 1,340,670 Electric Utilities - 1.11% Duke Energy Company 12,800 491,648 ------------ Food Products - 1.13% H.J. Heinz Company 11,700 496,548 ------------ Gas Utilities - 1.42% El Paso Corporation 12,800 627,968 ------------ Hotels, Restaurants & Leisure - 1.09% Harrah's Entertainment, Inc.* 16,500 480,645 ------------ Household Products - 1.23% Colgate Palmolive Co. 9,400 540,688 ------------ Industrial Conglomerates - 3.76% General Dynamics Corp. 5,400 440,640 General Electric Co. 19,700 717,277 Minnesota Mining & Manufacturing Co. 4,800 501,024 ------------ 1,658,941 Insurance - 2.54% Allmerica Financial Corp.* 13,600 530,400 American International Group, Inc.a 7,500 589,500 ------------ 1,119,900 Internet & Catalog Retail - 0.52% Ebay, Inc.* 4,400 230,912 ------------ Machinery - 0.68% SPX Corp.* 3,000 298,800 ------------ Media - 4.04% AOL Time Warner* 20,000 624,200 Echostar Communications Corp.* 11,000 255,090
Shares Value ------ ----- Media - continued General Motors Hughes* 32,600 $448,250 Omnicom Group 5,900 453,002 ------------ 1,780,542 Metals & Mining - 1.33% Alcoa, Inc. 18,200 587,314 ------------ Multiline Retail - 2.35% Target Corp. 16,900 526,435 Wal-Mart Stores, Inc. 9,900 508,860 ------------ 1,035,295 Oil & Gas - 3.92% Apache Corp. 8,200 423,120 ExxonMobil Corp. 19,200 757,440 Unocal Corp. 17,000 547,400 ------------ 1,727,960 Personal Products - 1.41% Gillette Company 20,000 621,800 ------------ Pharmaceuticals - 8.31% Abbott Laboratories, Inc. 10,400 550,992 American Home Products 12,000 669,960 Forest Labs, Inc.* 9,900 736,362 King Pharmaceuticals, Inc.* 11,300 440,587 Pfizer, Inc. 17,700 741,630 Teva Pharmaceutical Industries 8,500 525,300 ------------ 3,664,831 Road & Rail - 0.91% Norfolk Southern Corp. 24,000 402,000 ------------ Semiconductor Equipment & Products - 4.16% Analog Devices, Inc.* 11,900 452,200 Applied Materials, Inc.* 7,400 252,414 Flextronics International, Inc.* 15,100 300,490 Intel Corp. 12,700 310,134 Texas Instruments, Inc. 18,600 520,614 ------------ 1,835,852 Software - 2.37% BEA Systems, Inc.* 15,900 193,026 Microsoft Corp.* 10,900 633,835 Veritas Software Corp.* 7,700 218,526 ------------ 1,045,387 Specialty Retail - 1.39% Home Depot, Inc. 16,000 611,680 ------------ Wireless Telecommunication Service - 0.58% A T & T Wireless Services, Inc.* 17,600 254,144 ------------ TOTAL COMMON STOCKS (Cost $31,996,280) $28,010,324 ------------
The accompanying notes are an integral part of the financial statements. 87 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- CORPORATE BONDS - 15.93% Electric & Gas Utilities - 10.60% Commonwealth Edison Co., 8.38% due 09/15/22 $1,250,000 $1,345,103 El Paso Electric Co., 9.40% due 05/01/11 600,000 684,874 Indiana & Michigan Power Co., 8.50% due 12/15/22 1,000,000 1,074,521 Niagara Mohawk Power Corp., 8.50% due 07/01/23 250,000 262,960 Pennsylvania Power Co., 8.50% due 07/15/22 1,000,000 1,045,360 Texas Electric Utilities Co., 7.88% due 04/01/24 250,000 260,320 ------------ 4,673,138 Telecommunications - 5.33% Esat Holdings, 12.50% step-up due 02/01/07 750,000 789,417 Esat Telecommunications Group Plc, 11.88% due 12/01/08 500,000 597,896 Metronet Communications Corp., 9.95% step-up due 06/15/08 1,500,000 709,935 Public Service Company NM, 7.10% due 08/01/05 250,000 255,112 ------------ 2,352,360 TOTAL CORPORATE BONDS (Cost $7,452,334) $7,025,498 ------------ U.S. TREASURY OBLIGATIONS - 4.80% U.S. Treasury Notes - 4.80% 7.25% due 05/15/04 $1,000,000 $1,109,060 2.75% due 09/30/03 1,000,000 1,006,410 ------------ 2,115,470 TOTAL U.S. TREASURY OBLIGATIONS (Cost $2,046,286) $2,115,470 U.S. GOVERNMENT AGENCY OBLIGATIONS - 11.23% Federal Home Loan Banks - 2.24% 6.00% due 05/01/14 $752,427 $776,873 5.13% due 09/15/03 200,000 208,663 ------------ 985,536 Federal Home Loan Mortgage Corporation 3.73% 6.45% due 03/10/04 500,000 541,317 6.88% due 01/15/05 1,000,000 1,104,530 ------------ 1,645,847 Federal National Mortgage Association - 3.64% 6.00% due 05/15/08 400,000 435,064 7.25% due 01/15/10 1,000,000 1,168,590 ------------ 1,603,654 Resolution Funding FBE Strips - 1.62% Zero Coupon due 04/15/09 1,000,000 716,670 ------------ TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $4,440,575) $4,951,707 ------------
Shares Value ------ ----- SHORT TERM INVESTMENTS - 0.00% SSgA Money Market Fund (Cost $1,000) 1,000 $1,000 Principal Value --------- ----- REPURCHASE AGREEMENT - 4.52% Repurchase Agreement with State Street Bank & Trust Co. dated 10/31/01 at 2.52%, to be repurchased at $1,991,137 on 11/01/01, collateralized by U.S. Government Securities (Cost $1,991,000) $1,991,000 $1,991,000 ----------- TOTAL INVESTMENTS (Balanced Fund) (Cost $47,927,475) $44,094,999 ----------- - ------------------------------------------------------------------------------ Core Bond Fund - ------------------------------------------------------------------------------ Principal Value --------- ----- CORPORATE BONDS - 33.96% Automobiles - 0.48% Daimler Chrysler, 7.25% due 01/18/06 $2,095,000 $2,165,581 ----------- Banking - 2.44% Asian Development Bank, 6.38% due 10/01/28 2,730,000 2,960,467 Bank One Corp.,/\ 6.50% due 02/01/06/\ 2,650,000 2,818,487 First Financial Caribbean Corp., 7.84% due 10/10/06 135,000 143,482 First Union Corp., 6.95% due 11/01/04 2,050,000 2,218,161 Inter-American Development Bank,/\ 7.00% due 06/16/03/\ 2,730,000 2,907,996 ----------- 11,048,593 Chemical Products - 0.53% ICI North America, Inc., 8.88% due 11/15/06 65,000 73,717 International Flavours & Fragrances, 6.45% due 05/15/06 2,250,000 2,311,142 ----------- 2,384,859 Energy - 2.00% Amerada Hess Corp., 5.90% due 08/15/06 1,400,000 1,433,670 Edison Mission Energy, 10.00% due 08/15/08 3,500,000 3,792,824 Triton Energy, Ltd., 9.25% due 04/15/05 640,000 708,800 York International Corp., 6.63% due 08/15/06 3,000,000 3,138,180 ----------- 9,073,474
The accompanying notes are an integral part of the financial statements. 88 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Financial Services - 8.68% CNA Financial Corp.,/\ 6.25% due 11/15/03/\ $3,000,000 $2,955,930 Credit Suisse FB USA, Inc.,/\ 5.88% due 08/01/06/\ 3,000,000 3,113,730 Dana Credit Corp., 7.25% due 12/16/02 750,000 729,375 Devon Financing Corp., 6.88% due 09/30/11 1,000,000 1,001,100 Doral Financial Corp., 8.50% due 07/08/04 1,000,000 1,073,510 Duke Capital Corp., 7.50% due 10/01/09 1,830,000 2,034,704 Fairfax Financial Holdings, Ltd., 7.38% due 03/15/06 1,750,000 1,589,262 Fairfax Financial Holdings, Ltd., 8.25% due 10/01/15 1,750,000 1,328,320 Farmers Exchange Cap, 7.20% due 07/15/48 3,500,000 2,822,690 Ford Motor Credit Corp., 6.88% due 02/01/06 1,250,000 1,279,887 Ford Motor Credit Corp.,/\ 7.50% due 03/15/05/\ 4,665,000 4,850,107 ING Capital Funding, 8.44% due 12/31/49 5,040,000 5,717,840 International Finance Corp.,/\ 7.13% due 04/06/05/\ 2,840,000 3,125,562 KFW International Finance, Inc.,/\ 7.13% due 02/15/05/\ 2,000,000 2,198,640 Morgan Stanley Group, Inc., 6.75% due 04/15/11 500,000 524,200 Petrozuata Fin., Inc., 7.63% due 04/01/09 1,750,000 1,673,367 Qwest Capital Funding, Inc., 7.63% due 08/03/21 3,500,000 3,360,385 ------------ 39,378,609 Forest Products - 0.72% Stora Enso Corp., 7.38% due 05/15/11 3,000,000 3,257,430 ------------ Health Care Providers & Services - 0.73% Cardinal Health, Inc., 6.75% due 02/15/11 1,875,000 1,998,431 Healthsouth Corp., 8.38% due 10/01/11 1,250,000 1,315,625 Mediq/PRN Life Support Services,b 11.0% due 06/01/08 10,000 100 ------------ 3,314,156 Hotels, Restaurants & Leisure - 0.79% Harrah's Oper., Inc. 7.13% due 06/01/07 3,500,000 3,573,150 ------------
Principal Value --------- ----- Industrials - 0.42% Navistar International Corp., 9.38% due 06/01/06 $750,000 $742,500 SCL Aereo Santiago SA, 6.95% due 07/01/12, 144A 100,000 103,643 United Technologies, Inc., 6.35% due 03/01/11 1,000,000 1,062,050 ------------ 1,908,193 IT Consulting & Services - 0.46% Computer Sciences Corp.,/\ 6.75% due 06/15/06/\ 2,000,000 2,107,020 ------------ Media - 0.78% AOL Time Warner, Inc., 6.13% due 04/15/06 1,000,000 1,043,620 Clear Channel Communications, 7.25% due 09/15/03 1,250,000 1,319,800 Viacom, Inc., 6.63% due 05/15/11 1,100,000 1,150,089 ------------ 3,513,509 Metals & Mining - 0.42% Noranda, Inc., 8.38% due 02/15/11 1,750,000 1,915,637 ------------ Oil & Gas - 0.54% Kinder Morgan Energy Partners, LP, 6.75% due 03/15/11 1,000,000 1,055,220 Pennzoil Company, 10.13% due 11/15/09 125,000 149,784 Pennzoil Company, 10.25% due 11/01/05 205,000 237,695 Veritas DGC, Inc., 9.75% due 10/15/03 1,000,000 1,000,000 ------------ 2,442,699 Other - 4.28% Aramark Services, Inc.,/\ 6.75% due 08/01/04/\ 1,000,000 1,010,980 Embotelladora Arica SA, 9.88% due 03/15/06 3,000,000 3,228,159 Legrand SA, 8.50% due 02/15/25 3,000,000 3,440,100 PHH Corp.,/\ 8.13% due 02/03/03/\ 3,225,000 3,253,638 Stagecoach Holdings Plc, 8.63% due 11/15/09 750,000 728,738 USEC, Inc., 6.63% due 01/20/06 750,000 714,210 USEC, Inc., 6.75% due 01/20/09 1,600,000 1,452,672 WITCO Corp., 6.60% due 04/01/03 3,500,000 3,584,490 WITCO Corp.,/\ 8.50% due 03/15/05/\ 1,850,000 1,975,874 ------------ 19,388,861
The accompanying notes are an integral part of the financial statements. 89 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Pharmaceuticals - 0.44% Watson Pharmaceuticals, Inc., 7.13% due 05/15/08 $2,000,000 $2,006,600 ------------ Real Estate - 0.79% EOP Operations, LP,/\ 7.38% due 11/15/03 2,000,000 2,123,360 Grove Worldwide LLC, 9.25% due 05/01/08 15,000 525 Healthcare Realty Trust, 8.13% due 05/01/11b 1,400,000 1,466,360 ------------ 3,590,245 Retail - 1.13% Dillard's, Inc., 5.79% due 11/15/01 1,000,000 999,993 Dillard's, Inc., 6.43% due 08/01/04 2,000,000 1,866,960 K Mart Corp.,/\ 7.49% due 07/16/02/\ 2,250,000 2,269,732 ------------ 5,136,685 Software - 0.58% Quest Diagnostics, Inc., 6.75% due 07/12/06 2,500,000 2,627,028 ------------ Telecommunications - 4.47% British Telecommunications Plc,/\ 7.63% due 12/15/05/\ 2,610,000 2,853,017 Citizens Telecommunications Co.,/\ 7.63% due 08/15/08/\ 3,000,000 3,102,144 Crown Castle International Corp., 10.62% step-up due 11/15/07 600,000 492,000 GST Telecommunications, Inc., 12.75% 11/15/07b 20,000 300 Iridium Operations LLC, 11.25% due 07/15/05b 25,000 750 KMC Telecom. Holdings, Inc., 12.50% step-up due 02/15/08 50,000 1,500 Marconi Plc,/\ 8.38% due 09/15/30/\ 2,300,000 874,000 Metronet Communications Corp.,/\ 9.95% step-up due 06/15/08/\ 3,910,000 1,850,564 Shaw Communications, Inc., 7.25% due 04/06/11 1,000,000 1,032,950 Telefonica Europe BV, 8.25% due 09/15/30 3,500,000 3,924,585 Voicestream Wireless Corp., 10.38% due 11/15/09 2,000,000 2,295,220 Williams Communications Group, Inc., 8.25% due 03/15/04 2,000,000 2,068,380 Worldcom, Inc., 8.25% due 05/15/31 1,750,000 1,790,985 ------------ 20,286,395
Principal Value --------- ----- Transportation - 0.48% Delta Airlines, Inc.,/\ 7.78% due 11/18/08/\ $2,090,000 $2,138,593 Southern Railway Company, 8.75% due 10/15/03 30,000 32,744 ------------ 2,171,337 Utilities - 2.80% Brit Gas, Zero Coupon due 11/04/21 5,900,000 1,463,200 Entergy Ark, Inc., 6.13% due 07/01/05 1,500,000 1,555,668 Georgia Power Company, 6.20% due 02/01/06 3,440,000 3,630,026 Northern Illinois Gas Co., 6.63% due 02/01/11 2,150,000 2,304,090 Pennsylvania Electric Company,/\ 6.63% due 04/01/19/\ 2,925,000 2,760,352 South Carolina Electric & Gas Co., 6.70% due 02/01/11 915,000 971,812 ------------ 12,685,148 TOTAL CORPORATE BONDS (Cost $151,617,021) $153,975,209 ------------ U.S. TREASURY OBLIGATIONS - 2.96% U.S. Treasury Bonds - 0.53% 6.25% due 05/15/30 $2,000,000 $2,380,940 ------------ U.S. Treasury Notes - 1.45% 5.00% due 02/15/11 2,730,000 2,880,587 5.00% due 08/15/11 3,500,000 3,702,335 ------------ 6,582,922 U.S. Treasury Bond Strips - 0.98% Zero Coupon due 11/15/22 13,500,000 4,436,640 ------------ TOTAL U.S. TREASURY OBLIGATIONS (Cost $12,240,058) $13,400,502 ------------ U.S. GOVERNMENT AGENCY OBLIGATIONS - 34.86% Federal Farm Credit Banks - 1.37% 6.75% due 07/07/09/\/\ $5,540,000 $6,231,614 ------------ Federal Home Loan Banks - 2.10% 5.13% due 09/15/03/\/\ 400,000 417,326 5.32% due 12/23/08/\/\ 4,000,000 4,160,640 5.81% due 03/23/09/\/\ 3,780,000 4,026,305 6.01% due 12/03/08/\/\ 900,000 902,952 ------------ 9,507,223 Federal Home Loan Mortgage Corp. - 3.56% 6.00% Gold Single TBA** 10,425,000 10,519,451 6.50% Gold Balloon TBA** 150,000 156,000 7.00% due 03/01/12 83,689 88,214 8.00% due 10/01/29-01/01/31 5,074,764 5,369,709 ------------ 16,133,374
The accompanying notes are an integral part of the financial statements. 90 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Federal National Mortgage Association - 21.78% 5.69% due 01/23/06 $2,010,000 $2,057,416 6.18% due 07/01/08 19,258 20,701 6.27% due 11/01/07 52,831 56,895 6.30% due 01/01/08 19,174 20,690 6.31% due 02/01/08 191,701 198,194 6.34% due 01/01/08 18,758 20,262 6.43% due 01/01/08 19,171 20,807 6.50% TBA** 15,600,000 16,209,336 6.50% TBA** 29,425,000 30,252,725 6.50% due 04/01/29 402,505 414,580 6.98% due 06/01/07 18,310 20,171 7.00% TBA** 32,400,000 33,766,956 7.00% due 09/01/10 - 10/01/28 519,877 543,299 7.04% due 03/01/07 19,111 21,152 7.13% due 06/15/10/\ 9,570,000 11,126,656 7.28% due 10/01/06 19,074 21,252 7.50% due 10/01/10 - 08/01/15 3,771,991 3,979,501 ------------ 98,750,593 FICO Strips - 0.63% Zero Coupon due 05/11/18 7,500,000 2,875,200 ------------ Government National Mortgage Association - 4.96% 6.50% due 06/15/29 819,086 845,960 7.00% due 12/15/22 - 08/15/29 1,242,146 1,299,523 7.50% due 04/15/22 - 02/15/31 18,509,945 19,460,903 8.00% due 04/15/30/\ 820,597 868,036 ------------ 22,474,422 Tennessee Valley Authority - 0.46% 5.63% due 01/18/11 2,020,000 2,101,487 ------------ TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $152,284,259) $158,073,913 ------------ FIXED INCOME - OTHER - 8.72% Auto Loans Receivable - 2.73% Aesop Funding II LLC, 6.40% due 10/20/03, 144A $100,000 $102,801 Americredit Automobile Rec.,/\ 7.05% due 02/12/05 2,820,000 2,949,430 Associates Automobile Rec.,/\ 6.99% due 07/15/08 1,800,000 1,922,844 Daimler Chrysler,/\ 6.70% due 03/08/06 1,000,000 1,075,656 Ford Motor Credit Corp., 6.58% due 11/15/04 1,230,000 1,311,878 Nissan Auto Rec., 5.75% due 06/15/06 2,000,000 2,096,892 WFS Financial 2000 Rec., 7.17% due 02/20/08 2,700,000 2,915,668 ------------ 12,375,169
Principal Value --------- ----- Credit Cards Receivable - 0.67% Discover Card, 5.60% due 05/16/06 $150,000 $157,154 Fleet Credit Card, 6.90% due 04/16/07 2,640,000 2,875,109 ------------ 3,032,263 Other Asset Backed Securities - 5.32% American Airlines pass-through,/\ 6.82% due 05/23/11 3,500,000 3,487,365 Continental Airlines, 6.90% due 01/02/18 90,775 84,404 Continental Airlines pass-through, 6.65% due 09/15/17 64,142 59,387 Continental Airlines pass-through, 7.08% due 11/01/04 115,978 115,219 CWABS, Inc.,/\ 7.30% due 05/25/26 2,610,000 2,753,865 P P & L Transition LLC, 7.05% due 06/25/09 2,820,000 3,149,848 P S E & G Transition Funding LLC,/\ 6.75% due 06/15/16 3,580,000 3,949,580 Peco Energy Trans, 6.13% due 03/01/09 3,030,000 3,260,685 Systems 2001 LLC, 6.66% due 09/15/13 1,245,054 1,326,879 Systems 2001 LLC, 7.16% due 12/15/11 1,261,191 1,312,912 United Airlines pass-through,/\ 7.03% due 04/01/12 2,348,957 2,349,662 United Airlines pass-through,/\ 7.73% due 07/01/10 2,320,000 2,285,270 ------------ 24,135,076 TOTAL FIXED INCOME - OTHER (Cost $37,457,522) $39,542,508 ------------ Shares Value ------ ----- COMMON STOCKS - 0.00% Telecommunication Services - 0.00% SF Holdings Group, Inc., 144A 7 $28 ------------ TOTAL COMMON STOCKS (Cost $26) PREFERRED STOCKS - 0.00% Fairfield Mfg. Co., Inc., PIK 11.25% 27 8,167 Primedia, Inc., 8.625% 145 5,836 SF Holdings Group, Inc., 13.75% 2 2,075 XO Communications, Inc., 3.50% 5 263 ------------ TOTAL PREFERRED STOCKS (Cost $59,842) $16,341 ------------ WARRANTS - 0.00% Concentric Network Corp.,* Exp. 12/15/07, 144A 5 $1 KMC Telecom. Holdings, Inc.,* Exp. 04/15/08, 144A 50 2
The accompanying notes are an integral part of the financial statements. 91 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Shares Value ------ ----- WARRANTS - continued Motient Corp.,* Exp. 04/01/2008 5 $1 ------------ TOTAL WARRANTS (Cost $0) $4 ------------ Principal Value --------- ----- CORPORATE SHORT-TERM COMMERCIAL PAPER - 19.50% CVS Corp., 2.45% due 11/13/01 $13,242,000 $13,231,186 Delaware Funding Corp., 2.44% due 11/13/01 11,097,000 11,087,974 Duke Capital Corp., 2.67% due 11/01/01 12,000,000 12,000,000 Goldman Sachs Group, 2.40% due 11/16/01 10,000,000 9,990,000 Harley Davidson Dealer Funding, 2.42% due 11/09/01 6,000,000 5,996,773 Receivables Capital Corp., 2.40% due 11/13/01 8,053,000 8,046,558 Salomon Smith Barney Holdings, Inc., 2.41% due 11/14/01 14,000,000 13,987,816 Windmill Funding Corp., 2.45% due 11/16/01 14,114,000 14,099,592 ------------ TOTAL CORPORATE SHORT-TERM COMMERCIAL PAPER (Cost $88,439,899) $88,439,899 ------------ TOTAL INVESTMENTS (Core Bond Fund) (Cost $442,098,627) $453,448,404 ------------ - -------------------------------------------------------------- High Yield Bond Fund - -------------------------------------------------------------- Principal Value --------- ----- CORPORATE BONDS - 92.49% Aerospace & Defense - 1.74% BE Aerospace, Inc.: 8.88% due 05/01/11 $30,000 $22,050 9.50% due 11/01/08 655,000 514,175 Dunlop Std. Aerospace Holdings, 11.88% due 05/15/09 200,000 197,000 K & F Industries, 9.25% due 10/15/07 500,000 472,500 ------------ 1,205,725 Airlines - 2.26% American Airlines, 7.80% due 04/01/08 350,000 354,022 Atlas Air, Inc.: 8.77% due 01/02/11 408,834 424,112 9.25% due 04/15/08 125,000 87,500 9.70% due 07/02/11 184,707 184,333 10.75% due 0/01/05 100,000 65,500 Decrane Aircraft Holdings, 12.00% due 09/30/08 500,000 450,000 ------------ 1,565,467
Principal Value --------- ----- Autos & Auto Related - 2.61% Diamond Triumph Auto, 9.25% due 04/01/08 $250,000 $220,000 Dana Corp., 7.25% due 12/16/02 420,000 408,450 Hayes Lemmerz Int'l., Inc.,b 11.88% due 06/15/06, 144A 20,000 7,900 Pep Boys-Manny Moe & Jack: 6.63% due 05/15/03 160,000 147,200 6.52% due 07/16/07 430,000 412,800 Prestolite Electric, Inc., 9.63% due 02/01/08 900,000 612,000 ------------ 1,808,350 Banks - 0.81% Western Financial Bank, 8.88% due 08/01/07 585,000 557,109 ------------ Business & Commercial Services - 1.74% Americredit Corp., 9.25% due 02/01/04 350,000 304,500 Anthony Crane Rental, 10.38% due 08/01/08 144A 1,050,000 420,000 Integrated Electrical Services, 9.38% due 02/01/09 450,000 378,000 Pierce Leahy Corp., 8.13% due 05/15/08 100,000 99,000 ------------ 1,201,500 Chemicals - 1.58% Geo Specialty Chemicals, Inc., 10.13% due 08/01/08 350,000 297,500 IMC Gobal, Inc., 11.25% due 06/01/11 250,000 252,850 Koppers Industries, Inc., 9.88% due 12/01/07 350,000 332,500 Royster-Clark, Inc., 10.25% due 04/01/09 300,000 207,375 ------------ 1,090,225 Consulting Services - 1.34% Comdisco, Inc.: 6.13% due 08/01/06b 590,000 473,475 6.38% due 11/30/01b 560,000 449,400 ------------ 922,875 Containers-Paper - 0.45% Packaged Ice Inc., Series B, 9.75% due 02/01/05 500,000 315,000 ------------ Electronic Equipment & Services - 0.54% Flextronics International, Inc., 9.88% due 07/01/10 310,000 320,850 National Equipment Services, Inc., 10.00% due 11/30/04 65,000 51,350 ------------ 372,200
The accompanying notes are an integral part of the financial statements. 92 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Energy - 4.95% AES Drax Energy, Ltd., 11.50% due 08/30/10 $750,000 $671,250 AES Corp.: 8.75% due 12/15/02 70,000 71,050 8.75% due 06/15/08 375,000 350,625 8.88% due 02/15/11 150,000 136,500 Avista Corp., 9.75% due 06/01/08, 144A 700,000 746,907 Edison Mission Energy, 10.00% due 08/15/08 700,000 758,565 KCS Energy, 8.88% due 01/15/06 800,000 636,000 Swift Energy Co., 10.25% due 08/01/09 50,000 50,750 ------------ 3,421,647 Financial Services - 4.39% Banctec, Inc., 7.50% due 06/01/08 144A 450,000 135,000 Charter Communications Holding, 10.75% due 10/01/09 1,130,000 1,169,550 Finova Group, Inc., 7.50% due 11/15/09 325,000 120,250 LaBranche & Co., Inc., 12.00% due 03/02/07 655,000 707,400 Nexstar Finance, Inc., 12.00% due 04/01/08 400,000 378,000 Ono Finance Company Plc., 13.00% due 05/01/09 750,000 525,000 ------------ 3,035,200 Food & Drug Distribution - 3.42% Agrilink Foods, Inc., 11.88% due 11/01/08 365,000 324,850 Express Scripts, Inc., 9.63% due 06/15/09 600,000 660,000 Fleming Companies, Inc., 10.63% due 07/31/07 500,000 505,000 Great Atlantic & Pacific Tea, Inc., 7.70% due 01/15/04 225,000 218,813 Pharmerica, Inc., 8.38% due 04/01/08 450,000 450,000 Smithfield Foos, Inc., 8.00% due 10/15/09, 144A 200,000 207,500 ------------ 2,366,163 Funeral Services - 0.83% Stewart Enterprises, Inc., 10.75% due 07/01/08, 144A 525,000 572,250 ------------ Health Care Providers & Services - 8.06% Amerisource Bergen Corp., 8.13% due 09/01/08 500,000 526,250
Principal Value --------- ----- Health Care Providers & Services - continued Healthsouth Corp.: 8.38% due 10/01/11 $250,000 $263,125 10.75% due 10/01/08 200,000 222,500 Healthcare Reit, Inc., 7.63% due 03/15/08 300,000 309,444 Iasis Healthcare Corp., 13.00% due 10/15/09 520,000 556,400 Insight Health Services Corp., 9.88% due 11/01/11 70,000 72,450 Lifepoint Hospitals Holdings, Inc., 10.75% due 05/15/09 230,000 261,050 Manor Care, Inc., 7.50% due 06/15/06 250,000 264,015 Omega Healthcare Investments, Inc., 6.95% due 06/15/02 500,000 473,485 Physician Sales & Svc., Inc., 8.50% due 10/01/07 500,000 475,000 3Laris Medical Systems, Inc., 11.63% due 12/01/06 900,000 951,750 Unilab Corp., 12.75% due 10/01/09 195,000 221,569 Universal Hospital Services, Inc., 10.25% due 03/01/08 1,000,000 972,500 ------------ 5,569,538 Home Builders - 0.30% Champion Enterprises, Inc., 7.63% due 05/15/09 275,000 206,467 ------------ Hotels, Restaurants & Leisure - 8.71% Argosy Gaming, Inc., 9.00% due 09/01/11 600,000 627,000 Aztar Corp., 9.00% due 08/15/11, 144A 345,000 347,588 Cinemark USA, Inc., Series B, 9.63% due 08/01/08 500,000 445,000 Crown Castle International Corp.: 10.62% step-up due 11/15/07 350,000 287,000 10.62% step-up due 05/15/11 350,000 210,000 9.38% due 08/01/11 310,000 269,700 10.75% due 08/01/11 250,000 237,500 Hollywood Casino Shreveport, 13.00% due 08/01/06, 144A 105,000 87,150 Hollywood Park, Inc., Series B: 9.25% due 02/15/07 250,000 207,500 9.50% due 08/01/07 350,000 290,500 Horseshoe Gaming LLC, 9.38% due 06/15/07 500,000 526,250 Isle of Capri Casinos, Inc., 8.75% due 04/15/09 450,000 405,000 Riviera Black Hawk, Inc., 13.00% due 05/01/05 665,000 665,832 Tricon Global Restaurants, 8.88% due 04/15/11 500,000 530,000
The accompanying notes are an integral part of the financial statements. 93 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Hotels, Restaurants & Leisure - continued YankeeNets LLC, 12.75% due 03/01/07 $700,000 $882,000 ------------ 6,018,020 Household Products - 0.45% Sealy Mattress Company, 10.87% step-up due 12/15/07 375,000 296,250 Sleepmaster LLC,b 11.00% due 05/15/09 110,000 16,500 ------------ 312,750 Industrial - 1.55% BRL Unvl Equipment: 8.88% due 02/15/08 200,000 197,000 8.88% due 02/15/08 200,000 206,000 Hanover Equipment Trust, 8.50% due 09/01/08 300,000 313,500 Park Ohio Industries, Inc., 9.25% due 12/01/07 160,000 115,200 Polymer Group, Inc., 9.00% due 07/01/07 295,000 112,100 USI American Holdings, Inc., 7.25% due 12/01/06 175,000 125,563 ------------ 1,069,363 Insurance - 0.24% Conseco, Inc., 10.75% due 06/15/08 350,000 166,250 ------------ Internet Services - 0.71% UNOVA, Inc., 6.88% due 03/15/05 800,000 490,047 ------------ Machinery - 2.71% AGCO Corp., 9.50% due 05/01/08 100,000 103,000 Calpine Corp.: 7.75% due 04/15/09 8.50% due 05/01/08 200,000 195,384 Lennar Corp., 850,000 851,046 9.95% due 05/01/10 400,000 432,000 Penhall International Corp., 12.00% due 08/01/06 300,000 291,000 ------------ 1,872,430 Marine Services - 0.15% Trico Marine Services, Inc., 8.50% due 08/01/05 110,000 101,200 ------------ Media - 3.94% Belo Corp., 7.13% due 06/01/07 250,000 242,305 Cumulus Media, Inc., 10.38% due 07/01/08 620,000 620,000
Principal Value --------- ----- Media - continued Mediacom LLC: 9.50% due 01/15/13 $600,000 $612,000 11.00% due 07/15/13, 144A 650,000 689,000 Sinclair Broadcast Group, Inc., 9.00% due 07/15/07 250,000 240,000 STC Broadcasting, Inc., 11.00% due 03/15/07 370,000 321,900 ------------ 2,725,205 Merchandising - 1.91% Big 5 Corporation Series B, 10.88% due 11/15/07 250,000 240,000 Shop At Home, Inc., 11.00% due 04/01/05 750,000 742,500 True Temper Sports, Inc., 10.88% due 12/01/08 345,000 338,100 ------------ 1,320,600 Metals - 1.37% California Steel Industries, Inc., 8.50% due 04/01/09 50,000 44,250 Metals USA, Inc., 8.63% due 02/15/08 270,000 162,000 National Steel Corp., 9.88% due 03/01/09 300,000 60,000 Renco Metals, Inc., 11.50% due 07/01/03d 2,150,000 172,000 Russel Metals, Inc., 10.00% due 06/01/09 300,000 294,000 WCI Steel, Inc., 10.00% due 12/01/04 330,000 211,200 ------------ 943,450 Natural Gas - 1.79% Amerigas Partners, LP: 8.88% due 05/20/11 75,000 79,229 10.00% due 04/15/06,144A 525,000 556,500 Leviathan Gas Pipeline Ptnr. Co., Series B, 10.38% due 06/01/09 560,000 604,800 ------------ 1,240,529 Oil-Integrated Domestic - 0.56% Tesoro Petroleum Corp., 9.00% due 07/01/08 400,000 390,000 ------------ Oil & Gas Producers - 2.68% RB Falcon Corp., 9.50% due 12/15/08 25,000 29,603 Frontier Oil Corp., 11.75% due 11/15/09 520,000 551,200 Grey Wolf, Inc., 8.88% due 07/01/07 135,000 130,275 HS Resources, Inc., 9.25% due 11/15/06 625,000 640,625 Triton Energy, Ltd., 9.25% due 04/15/05 315,000 348,863
The accompanying notes are an integral part of the financial statements. 94 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Oil & Gas Producers - continued Westport Resources Corp., 8.25% due 11/01/11 $150,000 $151,688 ------------ 1,852,254 Paper & Forest Products - 2.73% Bear Island Paper Company LLC, 10.00% due 12/01/07 1,020,000 907,800 Buckeye Cellulose Corp., 8.50% due 12/15/05 485,000 453,475 Fibermark, Inc., 10.75% due 04/15/11 300,000 270,000 Specialty Paperboard, Inc., 9.38% due 10/15/06 300,000 252,000 ------------ 1,883,275 Pharmaceuticals - 3.19% ICN Pharmaceuticals, Inc., 9.75% due 11/15/08, 144A 1,775,000 1,961,375 King Pharmaceuticals, Inc., 10.75% due 02/15/09 220,000 243,650 ------------ 2,205,025 Pollution Control - 1.62% Allied Waste of North America, Inc., 10.00% due 08/01/09 1,115,000 1,123,363 ------------ Real Estate - 3.50% Courtyard Marriott II, Ltd., 10.75% due 02/01/08 800,000 793,000 Grove Worldwide LLC, 9.25% due 05/01/08 900,000 31,500 Meditrust Companies, 7.51% due 09/26/03 650,000 629,620 National Health Investors: 7.00% due 02/01/04 200,000 163,934 7.30% due 07/07/16 620,000 440,200 Rent-a-Center, Inc., 11.00% due 08/15/08 370,000 359,363 ------------ 2,417,617 Retail - 1.82% Rite Aid Corp.: 6.88% due 08/15/13 850,000 614,125 11.25% due 07/01/08 650,000 643,500 ------------ 1,257,625 Schools - 1.41% KinderCare Learning Centers, Inc., 9.50% due 02/15/09 1,000,000 975,000 ------------ Semi-Conductor - 0.34% Amkor Technology, Inc., 9.25% due 02/15/08 275,000 235,125 ------------ Telecommunications - 13.88% AirGate PCS, Inc., 13.50% step-up due 10/01/09 900,000 650,250
Principal Value --------- ----- Telecommunications - continued American Cellular Corp., 9.50% due 10/15/09 $625,000 $628,125 A T & T Wireless Services, Inc., 7.88% due 03/01/11 250,000 268,825 Benedek Communications Corp., 13.25% due 05/15/06 700,000 392,000 Callahan Nordrhein Westfallen, 14.00% due 07/15/10 565,000 344,650 Citizens Communications Co., 9.25% due 05/15/11 600,000 672,606 Condor Systems, Inc., 11.88% due 05/01/09b 500,000 170,000 CSC Holdings, Inc., 7.63% due 04/01/11 700,000 704,802 Ekabel Hessen, 14.50% due 09/01/10, 144A 630,000 340,200 Frontiervision Holdings, 11.88% due 09/15/07 1,000,000 1,020,000 GCI, Inc., 9.75% due 08/01/07 200,000 190,000 GT Group Telecommunications, Inc., 13.25% step-up due 02/01/10, 144A 1,400,000 259,000 Level 3 Communications, Inc., 11.00% step-up due 03/15/10, 144A 74,000 15,540 Marconi Plc., 7.75% due 09/15/10 850,000 348,500 Microcell Telecommunications, 12.38% step-up due 06/01/09 144A 1,200,000 360,000 Nextel Communications, 9.38% due 11/15/09 500,000 348,750 Nextlink Communications, Inc.: 9.45% step-up due 12/01/09, 144A 500,000 37,500 9.45% step-up due 04/15/08, 144A 200,000 18,000 Northland Cable Television, Inc., 10.25% due 11/15/07 525,000 357,000 Pegasus Satellite Communications Inc.: 12.38% due 08/01/06 250,000 200,000 13.50% step-up due 03/01/07 900,000 522,000 PSI Net, Inc., 11.00% due 08/01/09b 10,000 775 Salem Communications Holdings Corp., 9.00% due 07/01/11, 144A 525,000 551,250 360 Networks, Inc., 13.00% due 05/01/08b 350,000 1,750 Triton PCS Holdings, Inc., 9.38% due 02/01/11 105,000 110,250 Versatel Telecommunications B.V., 13.25% due 05/15/08 410,000 137,350 Versatel Telecommunications Int'l., 13.25% due 05/15/08 80,000 27,600 Voicestream Wireless Corp., 10.38% due 11/15/09 525,000 602,495
The accompanying notes are an integral part of the financial statements. 95 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Telecommunications - continued Williams Communications Group, 8.25% due 03/15/04 144A $300,000 $310,257 WinStar Communications, Inc., 14.75% due 04/15/10 144Ab 750,000 4,688 ------------ 9,594,163 Textiles & Apparel - 0.33% Anvil Knitwear, Inc., Series B, 10.88% due 03/15/07 70,000 59,500 Galey & Lord, Inc., 9.13% due 03/01/08 144Ab 675,000 165,375 ------------ 224,875 Utilities-Electric - 1.88% Caithness Coso Funding Corp., 9.05% due 12/15/09 800,000 771,000 ESI Tractebel Acquisition Corp., 7.99% due 12/30/11 500,000 528,065 ------------ 1,299,065 TOTAL CORPORATE BONDS (Cost $68,587,281) $63,926,943 ------------ Shares Value ------ ----- COMMON STOCK UNIT - 0.02% Ono Finance Company, 144A (Cost $0) 500 $14,625 ------------ PREFERRED STOCK - 1.89% Adelphia Communications Corp., Exchangeable Series B, 13.00% 6,000 $532,500 Anvil Holdings, Inc., Exchangeable Series B, 13.00% 27,516 392,101 Sinclair Cap, Exchangeable Series B, 11.63% 4,000 379,000 ------------ TOTAL PREFERRED STOCK (Cost $1,458,972) $1,303,601 ------------ WARRANTS - 0.03% GT Group Telecommunications, Inc.,* Exp. 02/01/10, 144A (Cost $67,479) 1,400 $17,500 ------------ Principal Value --------- ----- EXERCISABLE PUT OPTION SECURITIES - 0.48% Real Estate Investment Trust Meditrust Exercisable Put Option Security, 7.11%, Exp. 08/15/04 (Cost $241,092) 350,000 $330,750 ------------ Value ----- REPURCHASE AGREEMENT - 5.09% Repurchase Agreement with State Street Bank & Trust Co., dated 10/31/01 at 2.52%, to be repurchased at $3,521,243 on 11/01/01, collateralized by U.S. Government Securities (Cost $3,521,000) $3,521,000 $3,521,000 ------------ TOTAL INVESTMENTS (High Yield Bond Fund) (Cost $73,875,824) $69,114,419 ------------
- -------------------------------------------------------------------------------- Municipal Bond Fund - ------------------------------------------------------------------------------
Principal Value --------- ----- LONG-TERM INVESTMENTS - 99.80% Alabama - 0.25% Alabama Housing Finance Authority, Single Family Mortgage Revenue Collateralized Home Mortgage Program, Series B-2, 6.40%, 04/01/25 $40,000 $40,468 ------------ Alaska - 4.21% Anchorage, Alaska, Lease Revenue Bonds, 5.88%, 02/01/13 615,000 687,976 ------------ Arizona - 2.45% Maricopa County, AZ, Industrial Development Authority, 2.25%, 11/01/14 400,000 400,000 ------------ Arkansas - 1.67% Camden, Arkansas, Pollution Control, (International Paper Company Project), 5.70%, 09/01/12 250,000 272,570 ------------ California - 6.50% California Housing Finance Agency Revenue, Series H, 6.15%, 08/01/16 1,000,000 1,061,110 ------------ Colorado - 6.37% El Paso County, Colorado, Single Family Prerefunded, Zero Coupon, 09/01/15 2,000,000 1,040,500 ------------ District of Columbia - 13.43% District of Columbia Refunding, 5.50%, 06/01/09 45,000 50,249 District of Columbia Refunding, Series B, 5.50%, 06/01/07 1,000,000 1,097,420 District of Columbia, Medstar University Hospital, Series B, 6.63%, 08/15/31 1,000,000 1,047,410 ------------ 2,195,079 Illinois - 4.86% Illinois State Highway Authority Toll, Series A, 5.50%, 01/01/15 225,000 248,335 Chicago, Illinois, Water Revenue, 6.50%, 11/01/15 450,000 545,359 ------------ 793,694 Kansas - 0.99% Wyandotte County, Kansas City, Kansas, Unified Government Utility System Revenue, 5.75%, 09/01/24 150,000 161,024 ------------ Maine - 0.16% Maine State Housing Authority Mortgage Purchase, Revenue Series A-4, 6.375%, 11/15/12 25,000 25,639 ------------
The accompanying notes are an integral part of the financial statements. 96 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Michigan - 7.74% Marshall Michigan Pub Schools District, 5.00%, 05/01/21 $1,000,000 $1,000,750 Michigan State Hospital Finance Authority, Ascension Health Credit Service, 5.25%, 11/15/09 250,000 263,042 ----------- 1,263,792 Missouri - 6.03% Kansas City, Missouri, Passenger Facility, 5.00%, 04/01/20 1,000,000 984,580 ----------- Nevada - 2.83% Nevada Housing Division, Single-Family Revenue Program, B-2, 6.95%, 10/01/26 200,000 208,450 Nevada Housing Division, Single-Family Revenue Program, Issue C, 6.35%, 10/01/12 245,000 253,815 ----------- 462,265 New York - 2.91% New York State Mortgage Agency Revenue, Series 40-A, 6.35%, 04/01/21 235,000 243,241 New York State Mortgage Agency Revenue, Series 77A, 4.70%, 04/01/11 225,000 231,257 ----------- 474,498 North Dakota - 4.51% North Dakota State Water Commission Facilities Authority Revenue, Series A, 6.00%, 08/01/12 640,000 735,712 ----------- Ohio - 10.66% Lorain County, Ohio, Hospital Revenue, 5.25%, 10/01/33 1,000,000 983,220 Ohio State Revenue, New state infrastructure, 5.00%, 06/15/09 700,000 757,036 ----------- 1,740,256 Oklahoma - 1.58% Oklahoma Development Finance Auth., Public Service of Oklahoma Project, 4.88%, 06/01/14 250,000 258,475 ----------- Pennsylvania - 3.27% Philadelphia, Pennsylvania, Water & Wastewater Revenue, 6.25%, 08/01/12 450,000 533,399 ----------- Tennessee - 3.76% Shelby County, Tennessee, 5.00% due 08/15/23 550,000 613,734 -----------
Principal Value --------- ----- Texas - 13.56% Carroll, Texas, Independent School District, 6.38%, 02/15/21 $730,000 $868,700 Austin, Texas, Water & Wastewater, 6.50%, 05/15/05 400,000 446,524 Kerrville, Texas, Independent School District, 6.00%, 08/15/13 200,000 227,950 Lower Colorado River Authority, Texas Revenue, 6.00%, 05/15/10 250,000 285,343 Lower Colorado River Authority, Texas Prerefunded, 5.25%, 01/01/15 200,000 218,096 Robertson County, Texas, Industrial Develop. Revenue, 1.90% 11/01/05 100,000 100,000 Texas State Veterans Housing Assistance, 6.80%, 12/01/23 65,000 67,891 ----------- 2,214,504 Washington - 1.50% Central Puget Sound, Washington, Regional, 5.25%, 02/01/13 225,000 245,572 ----------- Wisconsin - 0.25% Wisconsin Housing & Economic Development Authority Home Ownership Revenue, Series D, 6.10%, 07/01/24 40,000 40,763 ----------- Wyoming - 0.31% Green River-Sweetwater County, Wyoming, 4.50%, 03/01/14 50,000 50,002 ----------- TOTAL LONG TERM INVESTMENTS (Cost $15,594,691) $16,295,612 -----------
Shares Value ------ ----- SHORT TERM INVESTMENTS - 0.20% SSgA Municipal Money Market Fund (Cost $33,324) 33,324 $33,324 ----------- TOTAL INVESTMENTS (Municipal Bond Fund) (Cost $15,628,015) $16,328,936 ----------- - ----------------------------------------------------------------------- Strategic Income Fund - ----------------------------------------------------------------------- Principal Value --------- ----- CORPORATE BONDS - 38.71% Aerospace & Defense - 0.27% BE Aerospace, Inc.: 8.88% due 05/01/11 $10,000 $7,350 9.50% due 11/01/08 70,000 54,950 Dunlop Std. Aerospace Holdings Plc, 11.88% due 05/15/09 30,000 29,550 ----------- 91,850
The accompanying notes are an integral part of the financial statements. 97 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Auto Related - 0.65% Hayes Lemmerz Int'l., Inc., 11.88% due 06/15/06 144Ab $10,000 $3,950 Pep Boys-Manny Moe & Jack, 6.52% due 07/16/07 100,000 96,000 Prestolite Electric, Inc., 9.63% due 02/01/08 175,000 119,000 ----------- 218,950 Banks - 0.37% Western Financial Savings Bank, 8.88% due 08/01/07 130,000 123,802 ----------- Business & Commercial Services - 2.41% Americredit Corp., 9.25% due 02/01/04 25,000 21,750 Banctec, Inc., 7.50% due 06/01/08 250,000 75,000 Cendant Corp., 7.75% due 12/01/03 100,000 100,995 Comdisco, Inc., 6.38% due 11/30/01b 175,000 140,438 Condor Systems, Inc., 11.88% due 05/01/09b 25,000 8,500 Dana Cr Corp., 7.25% due 12/16/02 144A 230,000 223,675 Finova Group, Inc., 7.50% due 11/15/09 85,000 31,450 Labranche & Co., Inc., 12.00% due 03/02/07 165,000 178,200 National Equipment Services, Inc. Series B, 10.00% due 11/30/04 25,000 17,000 National Equipment Services, Inc. Series C, 10.00% due 11/30/04 15,000 10,200 ----------- 807,208 Chemicals - 0.05% Geo Specialty Chemicals, Inc., 10.13% due 08/01/08 20,000 17,000 ----------- Crude Petroleum & Natural Gas - 1.73% Pennzoil Company, 10.25% due 11/01/05 500,000 579,745 ----------- Death Care Industry - 0.33% Stewart Enterprises, Inc., 10.75% due 07/01/08 144A 100,000 109,000 ----------- Electronic Equipment & Services - 0.40% Breed Technologies, Inc., 9.25% due 04/15/08b 500,000 2,500 Flextronics International, Ltd.: 8.75% due 10/15/07 60,000 60,000 9.88% due 07/01/10 70,000 72,450 ----------- 134,950
Principal Value --------- ----- Energy - 1.14% AES Corp.: 8.75% due 12/15/02 $80,000 $81,200 8.75% due 06/15/08 25,000 23,375 Avista Corp., 9.75% due 06/01/08, 144A 150,000 160,051 KCS Energy, Inc., 8.88% due 01/15/06 150,000 119,250 ----------- 383,876 Finance Companies - 0.63% Ono Finance Company Plc, 13.00% due 05/01/09 300,000 210,000 ----------- Food & Drug Distribution - 1.42% Agrilink Foods, Inc. 11.88% due 11/01/08 90,000 80,100 Express Scripts, Inc., 9.63% due 06/15/09 50,000 55,000 Pharmerica, Inc., 8.38% due 04/01/08 225,000 225,000 Smithfield Foods, Inc., 8.00% due 10/15/09, 144A 110,000 114,125 ----------- 474,225 Health Care Providers & Services - 2.83% Iasis Healthcare Corp., 13.00% due 10/15/09 105,000 112,350 Lifepoint Hospital Holdings, Inc., 10.75% due 05/15/09 50,000 56,750 Manor Care, Inc., 7.50% due 06/15/06 170,000 179,530 Omega Healthcare Investments, Inc., 6.95% due 06/15/02 135,000 127,841 Physician Sales & Svc., Inc., 8.50% due 10/01/07 150,000 142,500 Universal Hospital Services, Inc., 10.25% due 03/01/08 350,000 329,000 ----------- 947,971 Home Builders - 0.01% Beazer Homes USA, Inc., 8.88% due 04/01/08 3,000 3,030 ----------- Hotels, Restaurants & Leisure - 3.77% Argosy Gaming Company, 9.00% due 09/01/11 60,000 62,700 Aztar Corp., 9.00% due 08/15/11, 144A 175,000 176,313 Cinemark USA, Inc., 9.63% due 08/01/08 100,000 89,000 Crown Castle International Corp., 10.62% step-up due 05/15/11 350,000 210,000 Crown Castle International Corp., 9.38% due 08/01/11 35,000 30,450 Hollywood Casino, Shreveport, 13.0% due 08/01/06 5,000 4,150
The accompanying notes are an integral part of the financial statements. 98 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Hotels, Restaurants & Leisure - continued Isle of Capri Casinos, Inc., 8.75% due 04/15/09 $25,000 $22,500 Riviera Black Hawk, Inc., 13.00% due 05/01/05 275,000 275,344 Speedway Motorsports, Inc., 8.50% due 08/15/07 200,000 205,000 Tricon Global Restaurants, Inc., 8.88% due 04/15/11 175,000 185,500 ----------- 1,260,957 Industrial - 0.75% BRL Universal Equipment, 8.88% due 02/15/08 100,000 98,500 Callahan Nordrhein Westfallen, 14.00% due 07/15/10 210,000 128,100 Polymer Group, Inc., 9.00% due 07/01/07 70,000 26,600 ----------- 253,200 Internet Services - 0.64% Unova, Inc., 6.88% due 03/15/05 350,000 214,395 ----------- Machinery - 1.13% Lennar Corp., 9.95% due 05/01/10 125,000 135,000 Pennhall International, Inc., 12.0% due 08/01/06 250,000 242,500 ----------- 377,500 Marine Services - 0.14% Trico Marine Services, Inc., 8.50% due 08/01/05 50,000 46,000 ----------- Media - 1.49% Cumulus Media, Inc., 10.375% due 07/01/08 240,000 240,000 Mediacom Broadband LLC, 11.00% due 07/15/13, 144A 50,000 53,000 Nexstar Financial LLC, 12.00% due 04/01/08 120,000 113,400 Northland Cable Television, Inc., 10.25% due 11/15/07 135,000 91,800 ----------- 498,200 Merchandising - 2.77% Big 5 Corp., 10.88% due 11/15/07 125,000 120,000 Rent-a-Center, Inc., 11.00% due 08/15/08 170,000 165,113 Rite Aid Corp., 6.88% due 08/15/13 240,000 173,400 Rite Aid Corp., 11.25% due 07/01/08, 144A 150,000 148,500 Shop at Home, Inc., 11.00% due 04/01/05 150,000 148,500
Principal Value --------- ----- Merchandising - continued True Temper Sports, Inc., 10.88% due 12/01/08 $175,000 $171,500 ----------- 927,013 Natural Gas - 1.44% Amerigas Partners LP, 10.00% due 04/15/06, 144A 250,000 265,000 Leviathan Gas Pipeline Partners, 10.38% due 06/01/09 200,000 216,000 ----------- 481,000 Oil & Gas Producers - 2.15% Frontier Oil Corp., 11.75% due 11/15/09 130,000 137,800 Grey Wolf, Inc., 8.88% due 07/01/07 25,000 24,125 HS Resources, Inc., 9.25% due 11/15/06 50,000 51,250 HS Resources, Inc. Series B, 9.25% due 11/15/06 250,000 261,250 Tesoro Petroleum Corp., 9.00% due 07/01/08 250,000 243,750 ----------- 718,175 Paper & Forest Products - 2.02% Bear Island Paper Co. LLC, 10.00% due 12/01/07 285,000 253,650 Buckeye Cellulose Corp., 8.50% due 12/15/05 245,000 229,075 Fibermark, Inc., 10.75% due 04/15/11 100,000 90,000 Specialty Paperboard, Inc., 9.38% due 10/15/06 125,000 105,000 ----------- 677,725 Pharmaceuticals - 0.56% ICN Pharmaceuticals, Inc., 9.75% due 11/15/08, 144A 170,000 187,850 ----------- Pollution Control - 0.48% Allied Waste Industries, Inc., 10.00% due 08/01/09 160,000 161,200 ----------- Real Estate - 1.29% Courtyard Marriott II LP, 10.75% due 02/01/08 300,000 297,375 Grove Worldwide, Inc., 9.25% due 05/01/08b 175,000 6,125 HMH Properties, Inc., 7.88% due 08/01/08 100,000 85,500 National Health Investors, 7.00% due 02/01/04 50,000 40,984 ----------- 429,984 Steel - 0.31% Renco Metals, Inc., 11.50% due 07/01/03d 500,000 40,000
The accompanying notes are an integral part of the financial statements. 99 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Steel - continued WCI Steel, Inc., 10.00% due 12/01/04 $100,000 $64,000 ----------- 104,000 Telecommunication Services - 6.94% A T & T Wireless Services, Inc., 7.88% due 03/01/11 100,000 107,530 Adelphia Communications Corp., PIK, 9.50% due 02/15/04 46,998 44,296 Benedek Communications Corp., 13.25% due 05/15/06 185,000 103,600 Charter Communications Holdings, 10.75% due 10/01/09 200,000 207,000 Citizens Communications Co., 9.25% due 05/15/11 300,000 336,303 Ekabel Hessen, 14.50% due 09/01/10 130,000 70,200 Frontiervision Holdings, 11.88% due 09/15/07 400,000 408,000 GT Group Telecommunications, Inc., 13.25% step-up due 02/01/10 150,000 27,750 Level 3 Communications, Inc., 12.87% step-up due 03/15/10 53,000 11,130 Microcell Telecommunications, 12.00% step-up due 06/01/09 275,000 82,500 Nextel Communications, 9.95% step-up due 02/15/08 750,000 453,750 Nextlink Communications, Inc., 9.94% step-up due April 2003 170,000 15,300 Pegasus Communications Corp., 9.63% due 10/01/05 75,000 58,500 9.75% due 12/01/06 35,000 27,300 Pegasus Satellite Communications, 13.50% step-up due March 2004 400,000 232,000 Salem Communications Holdings Corp., 9.00% due 07/01/11 144A 100,000 105,000 Versatel Telecommunications B.V., 13.25% due 05/15/08 65,000 21,775 Versatel Telecommunications Int'l., Inc., 13.25% due 05/15/08 30,000 10,350 ----------- 2,322,284 Textiles - 0.13% Galey & Lord, Inc., 9.13% due 03/01/08 144Ab 175,000 42,875 ----------- Utilities-Electric - 0.46% Caithness Coso Funding Corp., 9.05% due 09/12/15 50,000 48,187 ESI Tractebel Acquisition Corp., 7.99% due 12/30/11 100,000 105,613 ----------- 153,800 ----------- TOTAL CORPORATE BONDS (Cost $13,858,702) $12,957,765 -----------
Principal Value --------- ----- U.S. GOVERNMENT AGENCY OBLIGATIONS - 13.18% Federal Home Loan Banks - 1.49% 6.50% due 05/01/29 $122,655 $126,449 7.00% due 06/01/29 167,751 175,091 8.50% due 05/01/08 184,230 196,932 ---------- 498,472 Federal Home Loan Mortgage Corporation - 0.47% 10.00% due 05/15/20 146,606 158,014 ---------- Federal National Mortgage Association - 7.28% 5.50% due 01/01/29 44,787 44,422 5.50% due 06/01/29 434,524 430,992 6.00% TBA** 1,000,000 1,011,880 7.50% due 01/01/30 399,219 418,182 7.50% due 09/01/30 151,942 159,197 8.00% due 11/01/28 315,647 336,161 13.00% due 11/01/15 29,480 35,072 ---------- 2,435,906 Federal National Mortgage Association - CMO - 0.87% 8.80% due 01/25/19, REMIC 229,952 249,640 10.40% due 04/25/19, REMIC 37,807 42,048 ---------- 291,688 Federal National Mortgage Assoc. - Interest Only - 1.86% 11.57% due 06/15/21 97,015 14,908 Interest Only due 03/17/20,REMIC 4,191,177 68,980 Interest Only due 02/25/35,REMIC 5,406,873 228,277 Interest Only due 10/17/36,REMIC 12,443,297 63,470 Interest Only due 06/25/38, REMIC 6,052,397 245,444 ---------- 621,079 Government National Mortgage Association - 1.21% 7.50% due 07/15/27 159,037 167,536 7.50% due 10/15/27 176,420 185,848 7.50% due 10/15/27 49,074 51,696 ---------- 405,080 ---------- TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $4,912,136) $4,410,239 ---------- FIXED INCOME - OTHER - 19.60% Collateralized Mortgage Obligations - 4.50% First Union Residential Securities, 7.00% due 08/25/28 $236,030 $238,513 /\Mid State Trust VI, Class A, 7.34% due 07/01/35 1,172,801 1,268,454 ---------- 1,506,967 Commercial Mortgage Backed Securities - 5.86% Commercial Mortgage Asset Trust, 7.35% due 08/17/13 1,200,000 1,307,224 DLJ Commercial Mortgage Corp., Interest Only Strips: due 05/10/23 9,239,334 324,818 due 11/12/31 7,366,048 327,585 ---------- 1,959,627
The accompanying notes are an integral part of the financial statements. 100 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- Residential Subordinate Securities - 9.24% GE Capital Management Services, Inc., 6.75% due 11/25/28 $965,947 $990,366 PNC Mortgage Securities Corp., 6.74% due 07/25/28 403,589 402,341 6.75% due 05/25/28 336,868 336,140 6.77% due 03/25/29 486,260 498,436 6.84% due 05/25/28 455,272 457,267 6.91% due 04/25/29 431,898 409,573 ---------- 3,094,123 TOTAL FIXED INCOME - OTHER (Cost $6,366,939) $6,560,717 ---------- FOREIGN GOVERNMENT OBLIGATIONS - 25.55% Algeria - 1.23% 5.81% due 03/04/10 $510,000 $410,550 ---------- Federal Republic of Brazil - 3.09% 5.50% step-up due 04/15/12 600,000 354,000 8.00% due 04/15/14 1,001,136 679,271 ---------- 1,033,271 National Republic of Bulgaria - 0.97% 4.56% due 07/28/12 400,000 324,000 ---------- Republic of Ecuador - 1.43% 5.00% step-up due 08/15/30 375,000 154,313 5.00% due 08/15/30, 144A 800,000 324,000 ---------- 478,313 Government of France - 0.35% 5.50% due 04/25/29 EUR 125,000 117,547 ---------- Federal Republic of Germany - 1.18% 4.00% due 07/04/09 EUR 110,000 97,208 4.25% due 11/26/04 EUR 200,000 184,387 5.63% due 01/04/28 EUR 120,000 114,842 ---------- 396,437 Republic of Greece - 0.48% 8.80% due 06/19/07 EUR 146,735 161,103 ---------- Republic of Italy - 0.29% 5.25% due 11/01/29 EUR 110,000 98,019 ---------- Government of Mexico - 4.01% 6.25% due 12/31/19 $1,400,000 1,342,741 ---------- Government of Morocco - 0.79% 5.09% due 01/01/09 303,572 264,107 ---------- Kingdom of Norway - 1.34% 5.75% due 11/30/04 NOK 4,000,000 448,734 ---------- Government of Peru - 2.72% 3.75% FRB due 03/07/17 $1,400,000 910,000 ---------- Russian Federation - 3.50% 5.00% due 03/31/30 $1,000,000 $476,250 5.00% step-up due 03/31/30, 144A 500,000 237,750
Principal Value --------- ----- Russian Federation - continued 10.00% due 06/26/07 $500,000 $456,750 ---------- 1,170,750 Republic of South Africa - 2.44% 12.00% due 02/28/05 ZAR 3,500,000 393,788 13.00% due 08/31/10 ZAR 3,500,000 425,142 ---------- 818,930 Kingdom of Spain - 0.24% 6.15% due 01/31/13 EUR 80,000 80,199 ---------- Kingdom of Sweden - 0.25% 10.25% due 05/05/03 SEK 800,000 81,846 ---------- Republic of Venezuela - 1.24% 5.69% due 03/31/07 $523,806 415,116 ---------- TOTAL FOREIGN GOVERNMENT OBLIGATIONS (Cost $8,518,794) $8,551,663 ---------- Shares Value ------ ----- COMMON STOCK UNIT - 0.01% Ono Finance Company 144A (Cost $0) 100 $2,925 ---------- PREFERRED STOCK - 1.93% Other-1.27% Anvil Holdings, Inc. 16,509 $235,253 Sinclair Capital 2,000 189,500 TCR Holdings-Class B 570 6 TCR Holdings-Class C 314 3 TCR Holdings-Class D 827 8 TCR Holdings-Class E 1,711 17 ---------- 424,787 Telecommunications - 0.66% Adelphia Communications Corp., Series B, 13.00% 2,500 221,875 ---------- TOTAL PREFERRED STOCK (Cost $724,051) $646,662 ---------- RIGHTS & WARRANTS - 0.10% Crude Petroleum & Natural Gas - 0.09% Terex Corporation, rights,* exp. 05/15/02 2,000 $33,050 Other - 0.00% BPC Holdings Corp. warrants#* exp. 04/15/04 500 0 Telephone - 0.00% In-flight Phone Corp., warrants#* exp. 5/15/02 1,000 0 Telecommunications - 0.01% GT Group Telecommunications, Inc.,* warrants, exp. 02/01/10 144A 150 1,875 Foreign Government - 0.00% Mexico (United States) warrants* Expire 6/01/02 250,000 0 ---------- TOTAL RIGHTS & WARRANTS (Cost $7,176) $34,925 ----------
The accompanying notes are an integral part of the financial statements. 101 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- EXERCISABLE PUT OPTION SECURITIES - 0.92% Real Estate Investment Trust - 0.92% Meditrust Exercisable Put Option Security, 7.11%, Exp. 08/15/04 (Cost $243,744) 326,000 $308,070 ----------- TOTAL INVESTMENTS (Strategic Income Fund) (Cost $34,631,542) $33,472,966 ----------- - ------------------------------------------------------------------- U.S. Government Securities Fund - ------------------------------------------------------------------- Principal Value --------- ----- U.S. TREASURY OBLIGATIONS - 8.93% U.S. Treasury Bonds - 1.44% 5.38% due 02/15/31/\ $250,000 $268,673 6.13% due 08/15/29 600,000 693,096 ----------- 961,769 U.S. Treasury Notes - 7.49% 2.75% due10/31/03 750,000 753,399 4.75% due 11/15/08/\ 1,500,000 1,566,555 5.00% due 02/15/11/\ 500,000 527,580 5.50% due 02/15/08/\ 2,000,000 2,176,880 ----------- 5,024,414 TOTAL U.S. TREASURY OBLIGATIONS (Cost $5,717,801) $5,986,183 ----------- U.S. GOVERNMENT AGENCY OBLIGATIONS - 67.41% Federal Farm Credit Banks - 5.96% 3.13% due 10/01/03 $500,000 $501,640 5.64% due 04/04/11 500,000 524,140 6.00% due 03/07/11 200,000 215,374 6.06% due 05/28/13 1,000,000 1,075,001 6.30% due 12/03/13 500,000 546,738 6.76% due 09/27/07 1,000,000 1,133,120 ----------- 3,996,013 Federal Home Loan Banks - 4.20% 4.65% due 10/17/06 1,500,000 1,528,253 5.72% due 02/01/07 1,000,000 1,047,764 8.00% due 06/01/08 79,247 83,426 8.25% due 07/01/06 53,044 55,647 8.50% due 05/01/08 65,379 69,005 11.75% due 08/01/13 29,023 33,238 ----------- 2,817,333 Federal Home Loan Mortgage Corporation - 19.81% 4.50% due 08/15/04 500,000 517,580 5.35% due 03/07/06 2,000,000 2,031,932 5.88% due 03/21/11 500,000 526,640 6.00% Gold Single TBA** 3,000,000 3,087,180 6.38% due 08/01/11 1,000,000 1,077,558 6.50% Gold Single TBA** 2,800,000 2,912,000 7.00% Gold Single TBA** 3,000,000 3,129,390 ----------- 13,282,280
Principal Value --------- ----- Federal National Mortgage Association - 31.14% 3.50% due 09/15/04 $2,200,000 $2,213,574 4.50% due 10/17/06 1,500,000 1,512,420 5.25% due 01/15/09/\ 4,500,000 4,678,605 5.25% due 08/14/06 1,000,000 1,025,790 5.50% due 03/15/11 500,000 523,280 5.50% due 05/16/06 1,000,000 1,047,810 5.51% due 05/16/06 1,000,000 1,004,060 5.69% due 01/23/06 260,000 266,133 6.15% due 03/15/11 1,000,000 1,013,120 6.50% TBA** 3,000,000 3,084,390 6.53% due 05/25/30 REMIC 2,750,000 2,920,485 6.66% due 12/28/28 REMIC 1,365,157 1,453,253 8.00% due 08/01/04 2,758 2,797 8.50% due 08/01/02 5,428 5,540 11.00% due 02/01/15 171 194 11.50% due 04/01/19 108,958 125,539 ----------- 20,876,990 Government National Mortgage Association - 1.86% 7.50% due 04/15/02 14,279 14,504 7.75% due 04/15/04 23,572 24,656 8.00% due 11/15/06 - 02/15/08 17,316 18,534 9.00% due 12/15/16 429,747 465,493 11.00% due 11/20/14 - 09/20/15 5,768 6,631 11.25% due 10/20/15 3,633 4,102 11.50% due 03/15/13 - 09/20/15 217,849 249,633 12.50% due 09/15/14 14,653 17,043 13.00% due 01/15/11 - 01/15/15 145,901 173,162 13.25% due 07/15/14 37,314 43,762 13.50% due 11/15/12 - 02/15/13 31,884 37,942 15.00% due 07/15/11 - 09/15/12 38,625 46,661 15.50% due 08/15/11 - 09/15/11 111,464 135,567 16.00% due 11/15/11 8,742 10,823 ----------- 1,248,513 International Bank for Reconstruction & Development - 0.55% 5.00% due 03/28/06 350,000 365,470 ----------- Student Loan Marketing Association - 2.34% 4.75% due 04/23/04/\ 1,000,000 1,041,870 5.25% due 03/15/06 500,000 527,265 ----------- 1,569,135 Tennessee Valley Authority - 1.55% 5.63% due 01/18/11/\ 1,000,000 1,040,340 ----------- TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS (Cost $43,997,214) $45,196,074 -----------
The accompanying notes are an integral part of the financial statements. 102 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- CORPORATE BONDS - 2.30% Banks - 0.75% Oesterreichische Kontrollbank, 6.63% due 10/18/04 $500,000 $504,137 ----------- Telecommunications - 1.55% Worldcom, Inc., 6.50% due 05/15/04 1,000,000 1,037,040 ----------- TOTAL CORPORATE BONDS (Cost $1,497,595) $1,541,177 ----------- Principal Value --------- ----- SHORT-TERM INVESTMENTS - 21.36% Federal Home Loan Bank Consumer Discount Note, 2.46% due 11/01/01 (Cost $14,322,000) $14,322,000 $14,322,000 ----------- TOTAL INVESTMENTS (U.S. Government Securities Fund) (Cost $65,534,610) $67,045,434 ----------- - --------------------------------------------------------------------------- Money Market Fund - --------------------------------------------------------------------------- Principal Value --------- ----- COMMERCIAL PAPER - 100.00% Archer Daniels Midland Co., 2.50% due 11/14/01 $1,000,000 $999,097 Associates Corp., 8.47% due 01/07/02 1,000,000 1,008,155 BancOne Corp., 2.84% due 11/19/01 1,500,000 1,497,870 Bellsouth Telecommunications, Inc., 2.45% due 11/29/01 1,157,000 1,154,795 Cardinal Health, Inc., 3.30% due 12/05/01 371,000 369,844 Cardinal Health, Inc., 2.65% due 01/17/02 1,000,000 994,332 Caterpillar Financial Services, 3.61% due 12/10/01 1,000,000 1,000,195 Ciesco L.P., 3.44% due 11/02/01 500,000 499,952 Countrywide Funding Corp., 2.45% due 11/28/01 933,000 931,286 CVS Corp., 2.45% due 11/06/01 521,000 520,823 Delaware Funding Corp., 2.54% due 11/02/01 1,000,000 999,929 Duke Capital Corp., 2.67% due 11/01/01 1,664,000 1,664,000 Federal Home Loan Bk Cons., 2.36% due 11/07/01 1,090,000 1,089,571 Federal Home Loan Bk Cons., 2.37% due 11/09/01 1,535,000 1,534,192
Principal Value --------- ----- COMMERCIAL PAPER - continued Federal Home Loan Bk Cons., 2.20% due 01/18/02 $1,667,000 $1,659,054 Federal Home Loan Bk Cons., 2.18% due 01/23/02 985,000 980,049 Federal Home Loan Bank, 3.95% due 07/30/02 1,000,000 1,000,000 Federal Home Loan Mtg Corp., 1.00% due 11/08/01 1,000,000 999,296 Federal Home Loan Mtg Corp., 2.25% due 12/14/01 500,000 498,656 Federal Home Loan Mtg Corp., 2.20% due 12/18/01 1,584,000 1,579,450 Federal Home Loan Mtg Corp., 3.68% due 12/21/01 880,000 875,502 Federal Home Loan Mtg Corp., 2.08% due 12/26/01 3,085,000 3,075,197 Federal Home Loan Mtg Corp., 2.13% due 01/09/02 1,000,000 995,918 Federal Home Loan Mtg Corp., 2.35% due 02/01/02 1,000,000 993,994 Federal Home Loan Mtg Corp., 2.20% due 02/22/02 850,000 844,130 Federal National Mtg Assn., 2.54% due 06/04/02 2,000,000 1,999,882 Federal National Mtg Assn., 2.38% due 11/06/01 800,000 799,736 Federal National Mtg Assn., 2.37% due 12/27/01 1,386,000 1,384,723 Federal National Mtg Assn., 2.25% due 12/27/01 1,550,000 1,544,575 General Dynamics Corp., 2.40% due 11/09/01 1,000,000 999,467 Goldman Sachs Group LP, 2.61% due 01/14/02 1,000,000 1,000,685 Goldman Sachs Group LP, 3.35% due 01/15/02 352,000 349,543 Govco, Inc., 3.35% due 12/05/01 800,000 797,469 Harley Davidson Dealer Funding, 2.43% due 11/06/01 1,000,000 999,663 Household Finance Corp., 3.39% due 01/25/02 1,000,000 991,996 JP Morgan Chase, 3.37% due 12/07/01 1,200,000 1,195,956 Merrill Lynch & Co., Inc., 3.76% due 11/01/01 1,500,000 1,500,000 Merrill Lynch & Co., Inc., 3.06% due 03/05/02 500,000 500,524 Nationsbank Corp., 4.04% due 06/17/02 1,000,000 1,001,210 Receivables Capital Corp., 2.47% due 11/09/01 925,000 924,492
The accompanying notes are an integral part of the financial statements. 103 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- COMMERCIAL PAPER - continued Safeway, Inc., 2.80% due 11/02/01 $1,000,000 $999,922 Salomon Smith Barney Holdings, Inc., 2.53% due 11/09/01 1,500,000 1,499,157 SBC Communications, Inc., 2.45% due 11/15/01 250,000 249,762 SBC Communications, Inc., 2.37% due 12/03/01 1,000,000 997,893 SBC Communications, Inc., 2.36% due 01/08/02 737,000 733,715 Schering Corp., 2.38% due 12/04/01 1,002,000 999,814 Snap-on Tools Corp., 3.35% due 12/14/01 500,000 497,999 Textron Financial Corp., 2.53% due 11/09/01 1,000,000 999,438 United Healthcare Corp., 2.48% due 11/05/01 1,000,000 999,724 United Healthcare Corp., 2.63% due 11/26/01 1,000,000 998,174 WindMill Funding Corp., 3.40% due 11/13/01 1,220,000 1,218,617 ----------- TOTAL COMMERCIAL PAPER 53,949,423 TOTAL INVESTMENTS (Money Market Fund) (Cost $53,949,423) $53,949,423 ----------- - ------------------------------------------------ Municipal Money Market Fund - ------------------------------------------------ Principal Value --------- ----- SHORT-TERM INVESTMENTS - 100.00% Arizona - 7.47% Arizona Health Facilities Authority, 2.12% due 10/01/15 $200,000 $200,000 Maricopa County Industrial Authority, 2.40% due 11/01/14 300,000 300,000 ----------- 500,000 Illinois - 8.96% Illinois Educational Facilities Authority, 2.05% due 01/01/28 100,000 100,000 Illinois Health Facilities Authority, 2.25% due 11/15/29 300,000 300,000 Illinois Health Facilities Authority, 2.05% due 03/01/31 200,000 200,000 ----------- 600,000 Indiana - 8.96% Indiana Secondary Market Educational Loans, 2.05% due 12/01/14 300,000 300,000 Marion, Indiana, Economic Development, 2.05% due 06/30/01 300,000 300,000 ----------- 600,000
Principal Value --------- ----- Kansas - 1.49% Shawnee Industrial Development, 2.20% due 12/01/09 $100,000 $100,000 ----------- Lousiana - 4.50% Port of New Orleans, Lousiana, 4.25% due 04/01/02 300,000 301,269 ----------- Maine - 4.48% Maine State Housing Authority, 2.05% due 10/28/32 300,000 300,000 ----------- Maryland - 1.49% Community Development Admin., Avalon Lea Apartments Project, 1.90% due 06/15/26 100,000 100,000 ----------- Michigan - 12.94% Detroit, Michigan, Sewage Disposal, 1.95% due 07/01/23 200,000 200,000 East Grand Rapids Public School, 4.00% due 05/01/02 265,000 266,283 Michigan State Strategic Fund, 2.15% due 11/01/06 300,000 300,000 Michigan State Strategic Fund, 2.10% due 06/01/31 100,000 100,000 ----------- 866,283 Missouri - 8.96% Missouri Higher Education Student Loans, 2.15% due 03/01/20 300,000 300,000 St. Louis Planned Industrial Expansion, 2.10% due 04/01/14 300,000 300,000 ----------- 600,000 Ohio - 11.21% Franklin County, Ohio, Industrial Development, 2.25% due 11/01/14 250,000 250,000 Hilliard, Ohio, School District, 4.00% due 12/01/01 200,000 200,177 Ohio State Development Authority, 4.00% due 12/01/01 300,000 300,374 ----------- 750,550 Pennsylvania - 2.99% Philadelphia, Pennsylvania, Authority for Industrial Development, 2.05% due 12/01/08 200,000 200,000 ----------- Rhode Island - 4.48% Rhode Island Health & Education, 2.05% due 09/01/30 300,000 300,000 -----------
The accompanying notes are an integral part of the financial statements. 104 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - --------------------------------------------------------------------------------
Principal Value --------- ----- South Carolina - 11.13% Piedmont Municipal Power Agency, 1.95% due 01/01/19 $250,000 $250,000 South Carolina Educational Facilities Authority, 2.10% due 10/01/26 300,000 300,000 South Carolina Jobs Economic, 1.90% due 02/15/28 195,000 195,000 ----------- 745,000 Tennessee - 4.50% Putnam County, Tennessee, 4.00% due 04/01/02 300,000 301,461 ----------- Texas - 5.99% North Texas Higher Education Authority, 2.05% due 04/01/20 200,000 200,000 Texas State University System, 4.25% due 03/15/02 200,000 200,972 ----------- 400,972 Shares Value ------ ----- Other - 0.45% SSgA Municipal Money Market Fund 29,976 29,976 ----------- TOTAL INVESTMENTS (Municipal Money Market Fund) (Cost $6,695,511) $ 6,695,511 ----------- - --------------------------------------------------------------------------- Aggressive Growth LifeStyle Fund - --------------------------------------------------------------------------- Shares Value ------ ----- AFFILIATED INVESTMENT COMPANIES - 100.00% INTERNATIONAL EQUITY SECURITIES - 24.92% North American International Equity Fund - Class I (Cost - $6,351,157) 772,586 $5,462,180 ----------- DOMESTIC EQUITY SECURITIES - 65.03% North American Growth & Income Fund - Class I 172,792 $3,262,318 North American Large Cap Growth Fund - Class I 417,959 4,384,394 North American Mid Cap Growth Fund - Class I 135,491 1,105,604 North American Mid Cap Value Fund - Class I 220,115 2,720,618 North American Small Cap Growth Fund - Class I 240,466 2,777,381 ----------- TOTAL DOMESTIC EQUITY SECURITIES - (Cost - $17,169,222) $14,250,315 -----------
Principal Value --------- ----- BONDS - 10.05% North American Core Bond Fund - Class I (Cost $2,141,912) 213,419 $2,202,486 ----------- TOTAL INVESTMENTS (Aggressive Growth LifeStyle Fund) (Cost - $25,662,291) $21,914,981 ----------- - -------------------------------------------------------------------------- Moderate Growth LifeStyle Fund - -------------------------------------------------------------------------- Shares Value ------ ----- AFFILIATED INVESTMENT COMPANIES - 100.00% INTERNATIONAL EQUITY SECURITIES - 17.94% North American International Equity Fund - Class I (Cost - $5,579,618) 677,836 $4,792,305 ----------- DOMESTIC EQUITY SECURITIES - 46.92% North American Growth & Income Fund - Class I 196,524 $3,710,380 North American Large Cap Growth Fund - Class I 280,114 2,938,399 North American Mid Cap Growth Fund - Class I 99,056 808,297 North American Mid Cap Value Fund - Class I 246,769 3,050,066 North American Small Cap Growth Fund - Class I 175,798 2,030,472 ----------- TOTAL DOMESTIC EQUITY SECURITIES - (Cost - $14,351,176) $12,537,614 ----------- BONDS - 35.14% North American Core Bond Fund - Class I 780,179 $8,051,446 North American High Yield Bond Fund - Class I 177,510 1,338,427 ----------- TOTAL BONDS (Cost - $9,193,144) $9,389,873 ----------- TOTAL INVESTMENTS (Moderate Growth LifeStyle Fund) (Cost - $29,123,938) $26,719,792 -----------
The accompanying notes are an integral part of the financial statements. 105 NORTH AMERICAN FUNDS PORTFOLIO OF INVESTMENTS - October 31, 2001 - continued (showing percentage of total value of investments) - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Conservative Growth LifeStyle Fund - ------------------------------------------------------------------------
Shares Value ------ ----- AFFILIATED INVESTMENT COMPANIES - 100.00% INTERNATIONAL EQUITY SECURITIES - 9.95% North American International Equity Fund - Class I (Cost - $2,234,434) 273,452 $1,933,307 ----------- DOMESTIC EQUITY SECURITIES - 34.89% North American Growth & Income Fund - Class I 122,322 $2,309,443 North American Large Cap Growth Fund - Class I 184,912 1,939,730 North American Mid Cap Growth Fund - Class I 47,951 391,281 North American Mid Cap Value Fund - Class I 101,284 1,251,871 North American Small Cap Growth Fund - Class I 76,589 884,608 ----------- TOTAL DOMESTIC EQUITY SECURITIES - (Cost - $7,631,818) $6,776,933 ----------- BONDS - 55.16% North American Core Bond Fund -Class I 944,191 $9,744,056 North American High Yield Bond Fund - Class I 128,897 971,884 ----------- TOTAL BONDS (Cost - $10,356,097) $10,715,940 ----------- TOTAL INVESTMENTS (Conservative Growth LifeStyle Fund) (Cost - $20,222,349) $19,426,180 -----------
- ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- Key to Currency Abbreviations CAD-Canadian Dollar EUR-European Currency Unit NOK- Norwegian Krone SEK-Swedish Krona ZAR-South African Rand Key to Security Abbreviations and Legend ADR American Depositary Receipt 144A Security exempt from registration under Rule 144A of the Securities Act of 1933. These securities may be resold in transactions exempt from registration, normally to qualified institutional buyers. FRB Floating Rate Bond. The interest rates shown on FRBs are the current interest rates at October 31, 2001, which are subject to change based on the terms of the security. PIK Payment-in-kind security REMIC Real Estate Mortgage Investment Conduit TBA To Be Announced /\ Collateral for forward commitments * Non-income-producing ** Purchased on a forward commitment (Note 2) # Security valued at fair value in the opinion of management (Note 1) a Investment in Affiliate b Non-income-producing; issuer is in bankruptcy and is in default of interest payments d Non-income-producing; issuer is in default of interest payments The accompanying notes are an integral part of the financial statements. 106 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- 1. ORGANIZATION OF THE TRUST. North American Funds (the "Trust") is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, (the "Investment Company Act") as an open-end management investment company. It is a series company, which means it has several portfolios, each with a stated investment objective which it pursues through separate investment policies. As of October 31, 2001, the Trust offered the following twenty-one portfolios: U.S. Equity Funds: Growth & Income Fund ("Growth & Income") Large Cap Growth Fund ("Large Cap Growth") Mid Cap Growth Fund ("Mid Cap Growth") Mid Cap Value Fund ("Mid Cap Value") Science & Technology Fund ("Science & Technology") Small Cap Growth Fund ("Small Cap Growth") Stock Index Fund ("Stock Index") International/Global Equity Funds: Global Equity Fund ("Global Equity") International Equity Fund ("International Equity") International Small Cap Fund ("International Small Cap") Balanced Funds: Balanced Fund ("Balanced") Income Funds: Core Bond Fund ("Core Bond") High Yield Bond Fund ("High Yield Bond") Municipal Bond Fund ("Municipal Bond") Strategic Income Fund ("Strategic Income") U.S. Government Securities Fund ("U.S. Government Securities") Money Market Funds: Money Market Fund ("Money Market") Municipal Money Market Fund ("Municipal Money Market") LifeStyle Funds: Aggressive Growth LifeStyle Fund ("Aggressive Growth LifeStyle") Moderate Growth LifeStyle Fund ("Moderate Growth LifeStyle") Conservative Growth LifeStyle Fund ("Conservative Growth LifeStyle") All of the portfolios are diversified management investment companies except for Small Cap Growth, Aggressive Growth LifeStyle, Moderate Growth LifeStyle and Conservative Growth LifeStyle, which are non-diversified management investment companies. The Trust offers Class A, Class B, Class C, Class I and, in Core Bond and High Yield Bond, Class II shares. Class A shares are sold with a front-end sales charge up to 5.75%. Class B and Class C shares are sold without an initial sales charge. Class B shares are sold with a contingent deferred sales charge which declines from 5% to zero depending on the period of time shares are held. Class C shares are sold with a contingent deferred sales charge of 1% in the first year after purchase. The redemption price per share may differ from the net asset value per share. Class B shares will automatically convert to Class A shares of the same portfolio eight years after purchase. Class I and Class II shares are sold only through institutional investment plans and other eligible programs as described in the prospectus and have no front-end or contingent deferred sales charges. All five classes of shares have identical voting, dividend, liquidation and other rights, except that each class has exclusive voting rights with respect to its distribution plan (See Note 5). Investment income, realized and unrealized capital gains and losses and common expenses of each portfolio are allocated on a pro-rata basis to each class based on their relative net assets. 107 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 1 - continued American General Asset Management Corp., Inc. ("AGAM") , a subsidiary of American General Corporation, ("American General") serves as investment adviser and American General Fund Distributors, Inc,. ("AGFD") serves as principal underwriter and distributor for the Trust. On August 29, 2001, American General was acquired by American International Group, Inc. (AIG), a Delaware corporation. As a result, AGAM and AGFD became subsidiaries of AIG. AIG is also the parent company of SunAmerica Asset Management Corp., advisor to the SunAmerica mutual funds ("SunAmerica Funds"). As further explained in Note 11, the Board of Directors of the North American Funds has approved an agreement and plan of reorganization between the North American Funds and the SunAmerica Funds. A Special Meeting of Shareholders of the Trust is scheduled on November 7, 2001 to seek approval of the reorganization of the Funds as well as proposals relating to new advisory and subadvisory contracts. 2. SIGNIFICANT ACCOUNTING POLICIES. The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements. The preparation of financial statements is in conformity with generally accepted accounting principles and requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates. Security Valuation. Securities which are traded on a recognized exchange are valued at the last sale price as of the close of business on a principal securities exchange (domestic or foreign) or, lacking any sales, at the closing bid price. Securities traded only in the over-the-counter market are valued at the last bid price quoted by brokers making markets in the securities at the close of trading on the New York Stock Exchange. Portfolio debt securities purchased with an original maturity greater than sixty days are valued by pricing agents, approved by the Board of Trustees, whose quotations reflect broker/dealer supplied valuations and complex valuation models. Other assets and securities for which no such quotation or valuations are readily available are valued at their fair value as determined in good faith under consistently applied procedures established by and under the general supervision of the Trustees. If trading or events occurring in foreign countries after the close of the principal market in which foreign securities are traded, and before the close of business of the Fund, are expected to materially affect the value of those securities, then they are valued at their perceived fair value taking this information into account. Short-term investments, and the investments of Money Market and Municipal Money Market are valued using the amortized cost method, permitted in accordance with Rule 2a-7 under the Investment Company Act. This method initially involves valuing a portfolio security at its cost and thereafter assuming a constant amortization to maturity of any discount or premium. The LifeStyle Funds' securities are valued at the per-share net asset values of the underlying funds. Foreign Currency Translations. The accounting records of the Trust are maintained in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on the following basis: (i) market value of securities, other assets and other liabilities at the current rate of exchange of such currencies against U.S. dollars; and (ii) purchases and sales of securities, income and expenses at the rate of exchange quoted on the respective dates of such transactions. Forward Foreign Currency Contracts. All portfolios, with the exception of U.S. Government Securities, Municipal Bond, Money Market and Municipal Money Market, may purchase and sell forward foreign currency contracts in order to hedge a specific transaction or portfolio position. 108 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 2 - continued The net U.S. dollar value of foreign currency underlying all contractual commitments held at the end of the period and the resulting net unrealized appreciation (depreciation) and related net receivable or payable amount are determined daily using forward currency exchange rates supplied by a quotation service. The Portfolio could be exposed to risks if the counterparties to the contracts are unable to meet the terms of their contracts or if the value of the foreign currency changes unfavorably. Net realized gains (losses) on forward foreign currency contracts, shown in the Statements of Operations, includes net gains or losses realized by a portfolio on contracts which have matured. Options Contracts. The Trust may use option contracts to hedge against changes in the value of securities the Trust owns or expects to purchase. The Trust may also write options on securities it owns or in which it may invest in an attempt to increase its current returns. The potential risk to the Trust is that the change in value of options contracts may not correspond to the change in value of the hedged instruments, but is generally limited to the premium originally paid. Also, losses may arise from changes in the value of the underlying instruments, if there is an illiquid secondary market for the contracts, or if the counterparty to the contract is unable to perform. When the contract is closed, the Trust records a realized gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed. Realized gains and losses on purchased options are included in realized gains and losses on investment securities. Exchange traded options are valued at the quoted daily settlement prices established by the exchange on which they trade. The Trust did not purchase or write option contracts during the year ended October 31, 2001. Forward Commitments. The Trust may purchase debt securities on a "when-issued" or "forward delivery" basis. Delivery and payment for securities which have been purchased or sold on a forward commitment basis can take place a month or more (not to exceed 120 days) after the date of the transaction. The price of the underlying securities and the date when the securities will be delivered and paid for are fixed at the time the transaction is negotiated. The Trust will establish a segregated account consisting of cash or liquid high-quality debt securities equal to the amount of the commitment to purchase when-issued or forward delivery securities. The value of the securities underlying a forward commitment to purchase securities, and any subsequent fluctuations in their value, is taken into account when determining the portfolio's net asset value starting on the day the portfolio agrees to purchase the securities. At October 31, 2001, the forward commitments were $89,953,864 in Core Bond, $12,103,225 in U.S. Government Securities and $995,917 in Strategic Income. Mortgage Dollar Rolls. Each of the portfolios (except High Yield Bond, Money Market, Municipal Money Market and the Lifestyles Funds) may enter into mortgage dollar rolls. Under a mortgage dollar roll, a Fund sells mortgage- backed securities for delivery in the future (generally within 30 days) and simultaneously contracts to repurchase substantially similar (same type, coupon and maturity) securities on a specified future date. During the roll period, the Fund forgoes principal and interest paid on the mortgage-backed securities. A Fund is compensated by the difference between the current sale price and the lower forward price for the future purchase (often referred to as the "drop") as well as by the interest earned on the cash proceeds of the initial sale. A Fund may also be compensated by receipt of a commitment fee. A Fund may only enter into "covered" rolls, which is a specific type of dollar roll for which there is an offsetting liquid asset. Dollar roll transactions involve the risk that the market value of the securities sold by the Fund may decline below the repurchase price of those securities. 109 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 2 - continued Futures Contracts. The Trust may enter into futures contacts. Upon entering into a futures contract, a portfolio is required to deposit with the custodian on behalf of the broker an amount of cash or cash equivalents equal to a certain percentage of the contract amount, which is known as the "initial margin". The potential risk to the Trust is that the change in value of futures contracts may not correspond to the change in value of the hedged instruments. Also, losses may arise from changes in the value of the underlying instruments, if there is an illiquid secondary market for the contracts, or if the counterparty to the contract is unable to perform. Subsequent payments, called "variation margin", are made or received by the portfolio, depending upon the fluctuation of the value of the futures contract. When futures contracts are closed, the difference between the opening value at the date of purchase and the value at closing is recorded as realized gain/(loss) in the Statement of Operations. Futures contracts are valued at the most recent settlement price. Securities Lending. Certain portfolios of the Trust may lend portfolio securities in amounts up to 33 1/3% of the portfolio's total non-cash assets to brokers, dealers and other financial institutions, provided such loans are callable at any time and are at all times fully collateralized by cash, cash equivalents, short-term investments or securities issued or guaranteed by the U.S. government or its agencies or instrumentalities, and marked to market to the value of the loaned securities on a daily basis. The portfolio may bear the risk of delay in recovery of, or even loss of rights in, the securities loaned should the borrower of the securities fail financially. The portfolio receives compensation for lending its securities either in the form of fees or by retaining a portion of interest on the investment of any cash received as collateral. Cash collateral is invested in the State Street Bank and Trust Company Navigator Securities Lending Trust. The related income is included as interest income in the Statements of Operations. Security lending income was $3,045 in Growth and Income, $2,861 in Large Cap Growth, $15,030 in Mid Cap Growth, $15,896 in Small Cap Growth, $5,556 in Global Equity, $33,781 in Core Bond, and $15,285 in Strategic Income. All collateral received will be in an amount equal to at least 100% of the market value of the loaned securities and should be maintained at that level during the period of the loan. During the loan period, the portfolio continues to retain rights of ownership, including dividends and interest of the loaned securities. Temporary under-collateralizations caused by market fluctuations in the value of securities loaned are corrected on the next business day. Federal Income Taxes. The Trust's policy is for each portfolio to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code, as amended, and to distribute all of its taxable income to its shareholders. Accordingly, no federal income tax provision is required. Each portfolio is treated as a separate taxpayer for federal income tax purposes. Distributions of Income and Gains. Distributions of net investment income are declared as a dividend to shareholders of record as of the close of business each day and are paid monthly for Core Bond, High Yield Bond, Municipal Bond, Strategic Income, U.S. Government Securities, Money Market and Municipal Money Market. Distributions of net investment income, if any, are declared as a dividend annually to shareholders of the remaining portfolios. During any particular year, net realized gains from investments, futures and foreign currency transactions for each portfolio, in excess of available capital loss carryforwards of each portfolio, would be taxable to the portfolio if not distributed and, therefore, will be distributed to shareholders. An additional distribution may be made to the extent necessary to avoid the payment of a federal excise tax. Income and capital gains distributions are determined in accordance with income tax regulations which may differ from generally accepted accounting principles. These differences are primarily due to differing book and tax treatments in the timing of the recognition of various gains or losses, and permanent book-to-tax differences due to differing treatments for certain transactions, including mortgage dollar roll income. Permanent book and tax basis differences affecting shareholder distributions result in reclassifications to paid in capital. Capital Loss Carryforwards. At October 31, 2001, capital loss carryforwards available to offset future recognized gains were approximately:
Capital Loss Carryforwards Expiration Year ------------------------------- Portfolio 2005 2006 2007 2008 2009 - --------- ---- ---- ---- ---- ----------- Large Cap Growth................................ - - - - $29,264,594 Mid Cap Growth.................................. - - - - 16,886,424 Small Cap Growth................................ - - - - 7,126,467
110 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 2 - continued
Capital Loss Carryforwards Expiration Year ------------------------------------------------- Portfolio 2005 2006 2007 2008 2009 - --------- -------- ------ ---------- ---------- ----------- Science & Technology........ - - - $1,069,495 $11,488,724 Stock Index................. - - - 36,999 917,634 Global Equity............... - - - 2,339,194 9,598,170 International Equity........ - - - - 1,152,221 International Small Cap..... - - - - 9,951,706 Balanced.................... - - - 2,378,112 7,400,729 Core Bond................... - - $3,128,860 7,052,964 - High Yield Bond............. - - 710,603 3,014,754 10,144,036 Municipal Bond.............. - - 81,077 3,360 - Strategic Income............ $110,152 - 3,866,240 3,438,003 2,043,272 U. S. Government Securities.................. - - - 1,112,091 - Money Market................ 359 $1,156 - 461 - Aggressive Growth LifeStyle................... - - - - 22,908 Moderate Growth LifeStyle... - - - - 123,344 Conservative Growth LifeStyle................... - - - - 319,851
As a result of reorganizations into some of these portfolios during the year ended October 31, 2000, certain capital loss carryforwards may be subject to limitations on use pursuant to applicable U.S. Federal Income Tax law. Therefore, it is possible not all of these capital losses will be available for use. Repurchase Agreements. Each portfolio may enter into repurchase agreements. When a portfolio enters into a repurchase agreement through its custodian, it receives delivery of securities, the amount of which at the time of purchase and each subsequent business day is required to be maintained at such a level that the market value is equal to 102% of the repurchase price, and such portfolio will take constructive receipt of all securities underlying the repurchase agreements until such agreements expire. If the seller defaults, a portfolio would suffer a loss to the extent that proceeds from the sale of underlying securities were less than the repurchase price. Foreign Securities. Investing in securities of foreign companies and foreign governments involves special risks and considerations not typically associated with investing in securities of domestic companies and the United States Government. These risks include revaluation of currencies and future adverse political and economic developments. Moreover, securities of foreign companies and foreign governments may be less liquid and their prices more volatile than those of securities of comparable domestic companies and the United States Government. Other. Investment security transactions are accounted for on trade date. Interest income is accrued as earned. Dividend income and distributions to shareholders are recorded on the ex-dividend date. All original issue discounts are accreted for financial and federal income tax reporting purposes. The Trust uses the First In, First Out method for determining realized gain or loss on investments, futures and foreign currency for both financial and federal income tax reporting purposes. Non-cash dividends, if any, are recorded at the fair market value of the securities received. Premium Amortization. The portfolios intend to adopt the provisions of the revised AICPA Audit and Accounting Guide for Investment Companies and will begin amortizing premium on all debt securities, for fiscal years beginning November 1, 2001. This change in accounting principle will not have an impact on total net assets of the portfolio, but will result in an increase or decrease to the cost of securities held, and corresponding changes to net investment income and accumulated net undistributed realized gain (loss). 111 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- 3. CAPITAL SHARES. Share activity for the year ended October 31, 2001, is as follows:
Shares Capital Shares Capital ---------- ------------ ---------- ------------ Class A Class B ------------------------ ------------------------ Growth & Income Sold...................... 1,234,554 $25,989,417 580,665 $12,204,803 Reinvestment of distributions............ 190,549 4,274,010 443,038 9,649,038 Redeemed.................. (1,036,291) (21,870,220) (1,844,100) (37,832,691) ---------- ------------ ---------- ------------ Net increase/(decrease).. 388,812 $8,393,207 (820,397) ($15,978,850) ---------- ------------ ---------- ------------ Class C Class I ------------------------ ------------------------ Growth & Income Sold...................... 595,287 $13,274,385 2,388,558 $51,312,370 Reinvestment of distributions............ 680,677 14,901,500 48,347 1,087,339 Redeemed.................. (2,609,581) (55,530,657) (513,651) (10,465,721) ---------- ------------ ---------- ------------ Net increase/(decrease).. (1,333,617) ($27,354,772) 1,923,254 $41,933,988 ---------- ------------ ---------- ------------ Class A Class B ------------------------ ------------------------ Large Cap Growth Sold...................... 220,229 $2,965,677 379,132 $4,990,438 Reinvestment of distributions............ 4,926 75,236 18,417 270,343 Redeemed.................. (249,120) (3,113,326) (543,396) (6,654,613) ---------- ------------ ---------- ------------ Net increase/(decrease).. (23,965) ($72,413) (145,847) ($1,393,832) ---------- ------------ ---------- ------------ Class C Class I ------------------------ ------------------------ Large Cap Growth Sold...................... 137,057 $1,859,802 1,155,936 $15,532,997 Reinvestment of distributions............ 10,855 159,345 10,584 162,573 Redeemed.................. (698,493) (8,786,236) (725,841) (9,871,581) ---------- ------------ ---------- ------------ Net increase/(decrease).. (550,581) ($6,767,089) 440,679 $5,823,989 ---------- ------------ ---------- ------------ Class A Class B ------------------------ ------------------------ Mid Cap Growth Sold...................... 299,001 $3,751,128 518,930 $6,201,323 Redeemed.................. (299,444) (3,370,211) (570,855) (6,336,232) ---------- ------------ ---------- ------------ Net increase/(decrease).. (443) $380,917 (51,925) ($134,909) ---------- ------------ ---------- ------------ Class C Class I ------------------------ ------------------------ Mid Cap Growth Sold...................... 222,517 $2,779,407 565,816 $6,407,029 Redeemed.................. (556,763) (5,983,656) (358,543) (4,137,896) ---------- ------------ ---------- ------------ Net increase/(decrease).. (334,246) ($3,204,249) 207,273 $2,269,133 ---------- ------------ ---------- ------------ Class A Class B ------------------------ ------------------------ Mid Cap Value Sold...................... 171,032 $2,331,060 387,745 $5,153,398 Reinvestment of distributions............ 1,156 15,647 3,137 41,470 Redeemed.................. (105,870) (1,405,209) (124,777) (1,642,285) ---------- ------------ ---------- ------------ Net increase/(decrease).. 66,318 $941,498 266,105 $3,552,583 ---------- ------------ ---------- ------------ Class C Class I ------------------------ ------------------------ Mid Cap Value Sold...................... 415,015 $5,504,186 510,190 $6,839,357 Reinvestment of distributions............ 436 5,738 4,433 59,848 Redeemed.................. (93,780) (1,196,344) (396,172) (5,382,039) ---------- ------------ ---------- ------------ Net increase/(decrease).. 321,671 $4,313,580 118,451 $1,517,166 ---------- ------------ ---------- ------------
112 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital ----------- ----------- ---------- ----------- ---------- ----------- Class A Class B ----------------------- ----------------------- Science & Technology Sold.................... 452,611 $2,480,570 1,406,188 $7,461,633 Redeemed................ (184,314) (840,828) (383,914) (2,003,728) ---------- ----------- ---------- ----------- Net increase/(decrease)... 268,297 $1,639,742 1,022,274 $5,457,905 ---------- ----------- ---------- ----------- Class C Class I ----------------------- ----------------------- Science & Technology Sold.................... 241,874 $1,314,621 216,086 $741,506 Redeemed................ (71,192) (348,860) (25,223) (87,008) ---------- ----------- ---------- ----------- Net increase/(decrease)... 170,682 $965,761 190,863 $654,498 ---------- ----------- ---------- ----------- Class A Class B ----------------------- ----------------------- Small Cap Growth Sold.................... 151,712 $2,124,777 319,617 $4,315,621 Reinvestment of distributions.......... 240 3,455 475 5,965 Redeemed................ (151,919) (1,988,864) (182,094) (2,326,355) ---------- ----------- ---------- ----------- Net increase/(decrease)... 33 $139,368 137,998 $1,995,231 ---------- ----------- ---------- ----------- Class C Class I ----------------------- ----------------------- Small Cap Growth Sold 70,469 $975,924 849,575 $11,407,459 Reinvestment of distributions 79 1,173 344 5,329 Redeemed (78,530) (1,034,399) (664,143) (9,226,261) ---------- ----------- ---------- ----------- Net increase/(decrease) (7,982) $(57,302) 185,776 $2,186,527 ---------- ----------- ---------- ----------- Class A Class B Class C ------------------------ ----------------------- ----------------------- Stock Index Sold.................... 258,853 $2,809,192 752,293 $8,179,271 148,248 $1,626,854 Reinvestment of distributions.......... 7,719 91,839 6,053 71,582 152 1,840 Redeemed................ (123,652) (1,329,916) (385,467) (4,208,540) (38,887) (379,280) ---------- ----------- ---------- ----------- Net increase/(decrease)... 142,920 $1,571,115 372,879 $4,042,313 109,513 $1,249,414 ---------- ----------- ---------- ----------- Class A Class B Class C ------------------------ ----------------------- ----------------------- Global Equity Sold.................... 9,858,494 $74,484,383 98,087 $857,307 2,511,422 $20,839,116 Redeemed................ (10,086,030) (76,602,465) (563,860) (4,760,872) (3,135,849) (26,503,539) ---------- ----------- ---------- ----------- Net increase/(decrease)... (227,536) ($2,118,082) (465,773) ($3,903,565) (624,427) ($5,664,423) ---------- ----------- ---------- ----------- Class A Class B ----------------------- ----------------------- International Equity Sold.................... 6,833,372 $55,326,269 109,795 $928,636 Reinvestment of distributions.......... 104,017 912,292 289,749 2,494,974 Redeemed................ (6,714,143) (54,791,217) (754,550) (6,032,564) ---------- ----------- ---------- ----------- Net increase/(decrease)... 223,246 $1,447,344 (355,006) ($2,608,954) ---------- ----------- ---------- ----------- Class C Class I ----------------------- ----------------------- International Equity Sold.................... 719,591 $5,303,281 1,872,733 $15,530,985 Reinvestment of distributions.......... 71,262 611,443 288,888 2,527,768 Redeemed................ (848,789) (6,486,230) (1,142,578) (9,274,912) ---------- ----------- ---------- ----------- Net increase/(decrease)... (57,936) ($571,506) 1,019,043 $8,783,841 ---------- ----------- ---------- ----------- Class A Class B Class C ------------------------ ----------------------- ----------------------- International Small Cap Sold.................... 3,069,040 $39,012,852 102,757 $1,501,854 427,965 $5,251,697 Reinvestment of distributions.......... 15,999 254,549 40,577 616,795 30,445 464,624 Redeemed................ (3,150,892) (40,554,846) (256,095) (3,208,907) (609,304) (7,634,400) ---------- ----------- ---------- ----------- Net increase/(decrease)... (65,853) ($1,287,445) (112,761) ($1,090,258) (150,894) ($1,918,079) ---------- ----------- ---------- -----------
113 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital -------- ---------- ---------- ----------- ---------- ------------ Class A Class B ----------------------- ------------------------ Balanced Sold.................... 377,877 $3,072,455 276,174 $2,281,083 Reinvestment of distributions.......... 10,085 87,644 10,496 85,846 Redeemed................ (307,583) (2,441,547) (473,625) (3,845,679) ---------- ----------- ---------- ------------ Net increase/(decrease)... 80,379 $718,552 (186,955) ($1,478,750) ---------- ----------- ---------- ------------ Class C Class I ----------------------- ------------------------ Balanced Sold.................... 206,752 $1,747,723 69,852 $576,524 Reinvestment of distributions.......... 21,216 186,702 8,660 75,342 Redeemed................ (1,073,093) (8,808,279) (48,158) (390,975) ---------- ----------- ---------- ------------ Net increase/(decrease)... (845,125) ($6,873,854) 30,354 $260,891 ---------- ----------- ---------- ------------ Class A Class B ----------------------- ------------------------ Core Bond Sold.................... 749,331 $7,544,115 734,761 $7,432,034 Reinvestment of distributions.......... 17,345 173,077 17,807 177,054 Redeemed................ (595,272) (6,007,942) (639,336) (6,431,400) ---------- ----------- ---------- ------------ Net increase/(decrease)... 171,404 $1,709,250 113,232 $1,177,688 ---------- ----------- ---------- ------------ Class C Class I Class II -------------------- ----------------------- ------------------------ Core Bond Sold.................... 227,976 $2,285,866 1,645,817 $16,370,023 - $1,524 Reinvestment of distributions.......... 13,431 133,989 115,041 1,146,148 1,778,941 17,730,388 Redeemed................ (88,591) (883,790) (1,628,390) (16,244,781) (3,451,705) (34,500,081) ---------- ----------- ---------- ------------ Net increase/(decrease)... 152,816 $1,536,065 132,468 $1,271,390 (1,672,764) ($16,768,169) ---------- ----------- ---------- ------------ Class A Class B ----------------------- ------------------------ High Yield Bond Sold.................... 75,688 $615,809 483,298 $3,962,040 Reinvestment of distributions.......... 3,859 30,621 16,013 127,606 Redeemed................ (17,385) (137,778) (300,089) (2,435,260) ---------- ----------- ---------- ------------ Net increase/(decrease)... 62,162 $508,652 199,222 $1,654,386 ---------- ----------- ---------- ------------ Class C Class I Class II -------------------- ----------------------- ------------------------ High Yield Bond Sold.................... 312,156 $2,519,905 565,132 $4,507,963 - $- Reinvestment of distributions.......... 12,371 97,788 25,215 200,970 821,161 6,448,641 Redeemed................ (86,966) (694,931) (186,180) (1,472,683) (9) (67) ---------- ----------- ---------- ------------ Net increase/(decrease)... 237,561 $1,922,762 404,167 $3,236,250 821,152 $6,448,574 ---------- ----------- ---------- ------------ Class A Class B Class C -------------------- ----------------------- ------------------------ Municipal Bond Sold.................... 221,719 $2,193,052 287,957 $2,878,818 261,443 $2,597,495 Reinvestment of distributions.......... 25,006 249,517 17,276 172,415 6,367 63,377 Redeemed................ (235,192) (2,338,296) (405,087) (4,048,693) (287,072) (2,843,225) ---------- ----------- ---------- ------------ Net increase/(decrease)... 11,533 $104,273 (99,854) ($997,460) (19,262) ($182,353) ---------- ----------- ---------- ------------ Class A Class B ----------------------- ------------------------ Strategic Income Sold.................... 575,829 $4,550,331 370,225 $2,919,192 Reinvestment of distributions.......... 53,879 425,950 93,959 744,405 Redeemed................ (344,069) (2,739,615) (1,073,750) (8,487,543) ---------- ----------- ---------- ------------ Net increase/(decrease)... 285,639 $2,236,666 (609,566) ($4,823,946) ---------- ----------- ---------- ------------ Class C Class I ----------------------- ------------------------ Strategic Income Sold.................... 292,025 $2,296,419 - $- Reinvestment of distributions.......... 82,455 652,508 31,782 246,961 Redeemed................ (531,495) (4,211,108) - - ---------- ----------- ---------- ------------ Net increase/(decrease)... (157,015) ($1,262,181) 31,782 $246,961 ---------- ----------- ---------- ------------
114 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital ----------- ------------ ----------- ----------- ----------- ----------- Class A Class B Class C ------------------------- ------------------------ ------------------------ U.S. Government Securities Sold.................... 14,435,379 $142,407,993 1,412,075 $14,037,315 2,145,773 $21,082,318 Reinvestment of distributions.......... 114,944 1,125,768 29,337 286,712 35,803 343,152 Redeemed................ (14,195,336) (139,830,876) (1,246,512) (12,326,480) (2,181,700) (21,399,973) ----------- ------------ ----------- ----------- ----------- ----------- Net increase/(decrease)... 354,987 $3,702,885 194,900 $1,997,547 (124) $25,497 ----------- ------------ ----------- ----------- ----------- ----------- Class A Class B ------------------------ ------------------------ Money Market Sold.................... 64,388,360 $64,388,358 15,169,365 $15,169,363 Reinvestment of distributions.......... 1,114,468 1,114,468 344,297 344,297 Redeemed................ (63,854,777) (63,857,168) (12,170,236) (12,171,005) ----------- ------------ ----------- ----------- ----------- ----------- Net increase/(decrease)... 1,648,051 $1,645,658 3,343,426 $3,342,655 ----------- ------------ ----------- ----------- ----------- ----------- Class C Class I ------------------------ ------------------------ Money Market Sold.................... 34,178,600 $34,178,600 4,883,627 $4,883,629 Reinvestment of distributions.......... 295,548 295,548 280,818 280,818 Redeemed................ (33,100,633) (33,101,266) (3,459,824) (3,475,805) ----------- ------------ ----------- ----------- ----------- ----------- Net increase/(decrease)... 1,373,515 $1,372,882 1,704,621 $1,688,642 ----------- ------------ ----------- ----------- ----------- ----------- Class A Class B Class C ------------------------- ------------------------ ------------------------ Municipal Money Market Sold.................... 1,111,972 $1,112,114 62,915 $62,914 168,884 $168,884 Reinvestment of distributions.......... 100,073 100,073 63,903 63,903 2,409 2,409 Redeemed................ (1,695,937) (1,695,937) (292,798) (292,798) (143,782) (143,782) ----------- ------------ ----------- ----------- ----------- ----------- Net increase/(decrease)... (483,892) ($483,750) (165,980) ($165,981) 27,511 $27,511 ----------- ------------ ----------- ----------- ----------- ----------- Class A Class B ------------------------ ------------------------ Aggressive Growth LifeStyle Sold.................... 117,408 $1,098,427 450,164 $4,358,173 Reinvestment of distributions.......... 71,677 706,323 243,396 2,403,215 Redeemed................ (71,982) (644,470) (125,142) (1,150,059) ----------- ------------ ----------- ----------- ----------- ----------- Net increase/(decrease)... 117,103 $1,160,280 568,418 $5,611,329 ----------- ------------ ----------- ----------- ----------- ----------- Class C Class I ------------------------ ------------------------ Aggressive Growth LifeStyle Sold.................... 19,662 $183,574 266,592 $2,388,394 Reinvestment of distributions.......... 3,655 36,216 88,598 874,251 Redeemed................ (7,857) (69,675) (44,977) (410,052) ----------- ------------ ----------- ----------- ----------- ----------- Net increase/(decrease)... 15,460 $150,115 310,213 $2,852,593 ----------- ------------ ----------- ----------- ----------- ----------- Class A Class B ------------------------ ------------------------ Moderate Growth LifeStyle Sold.................... 151,471 $1,574,137 572,410 $5,714,312 Reinvestment of distributions.......... 51,382 516,345 154,560 1,560,419 Redeemed................ (47,854) (444,424) (194,909) (1,868,300) ----------- ------------ ----------- ----------- ----------- ----------- Net increase/(decrease)... 154,999 $1,646,058 532,061 $5,406,431 ----------- ------------ ----------- ----------- ----------- ----------- Class C Class I ------------------------ ------------------------ Moderate Growth LifeStyle Sold.................... 71,200 $708,779 539,689 $5,213,319 Reinvestment of distributions.......... 3,045 30,642 72,733 731,965 Redeemed................ (6,247) (58,276) (82,754) (779,202) ----------- ------------ ----------- ----------- ----------- ----------- Net increase/(decrease)... 67,998 $681,145 529,668 $5,166,082 ----------- ------------ ----------- ----------- ----------- ----------- Class A Class B ------------------------ ------------------------ Conservative Growth LifeStyle Sold.................... 98,491 $986,079 240,756 $2,478,072 Reinvestment of distributions.......... 42,833 428,349 124,717 1,252,906 Redeemed................ (67,835) (642,462) (199,307) (1,960,310) ----------- ------------ ----------- ----------- ----------- ----------- Net increase/(decrease)... 73,489 $771,966 166,166 $1,770,668 ----------- ------------ ----------- ----------- ----------- -----------
115 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital ---------- ----------- ---------- ----------- Class C Class I ----------------------- ----------------------- Conservative Growth LifeStyle Sold........................ 64,397 $655,774 174,064 $1,741,777 Reinvestment of distributions.............. 2,767 27,969 55,665 557,065 Redeemed.................... (11,746) (117,340) (40,675) (396,177) ---------- ----------- ---------- ----------- Net increase/(decrease).... 55,418 $566,403 189,054 $1,902,665 ---------- ----------- ---------- ----------- Share activity for the year ended October 31, 2000, was as follows: Shares Capital Shares Capital ---------- ----------- ---------- ----------- Class A Class B ----------------------- ----------------------- Growth & Income Sold........................ 520,232 $14,345,704 650,532 $17,609,391 Shares issued in connection with the merger of North American Equity-Income..... 304,952 8,608,176 610,686 16,835,378 Shares issued in connection with the merger of North American Tax-Sensitive Equity..................... 9,543 269,386 82,798 2,282,585 Shares issued in connection with the merger of AGSPC2 Large Cap Value............ 92,804 2,619,669 274,941 7,579,579 Reinvestment of distributions.............. 105,709 2,884,282 315,780 8,444,061 Redeemed.................... (605,069) (16,899,847) (1,601,437) (43,338,250) ---------- ----------- ---------- ----------- Net increase/(decrease).... 428,171 $11,827,370 333,300 $9,412,744 ---------- ----------- ---------- ----------- Class C Class I ----------------------- ----------------------- Growth & Income Sold........................ 1,062,513 $29,009,747 276,505 $7,842,218 Shares issued in connection with the merger of North American Equity-Income..... 1,410,041 39,042,706 - - Shares issued in connection with the merger of North American Tax-Sensitive Equity..................... 81,780 2,264,394 - - Shares issued in connection with the merger of AGSPC2 Large Cap Value............ - - 162,787 4,598,570 Reinvestment of distributions.............. 449,765 12,080,942 - - Redeemed.................... (2,073,452) (56,268,644) (60,597) (1,642,017) ---------- ----------- ---------- ----------- Net increase/(decrease).... 930,647 $26,129,145 378,695 $10,798,771 ---------- ----------- ---------- ----------- Class A Class B ----------------------- ----------------------- Large Cap Growth Sold........................ 180,298 $3,963,213 510,101 $11,202,280 Shares issued in connection with the merger of AGSPC2 Large Cap Growth........... 240,358 5,302,772 922,147 19,731,175 Reinvestment of distributions.............. 74,768 1,502,311 265,589 5,130,551 Redeemed.................... (237,334) (5,349,958) (551,390) (12,079,257) ---------- ----------- ---------- ----------- Net increase/(decrease).... 258,090 $5,418,338 1,146,447 $23,984,749 ---------- ----------- ---------- ----------- Class C Class I ----------------------- ----------------------- Large Cap Growth Sold........................ 542,311 $12,012,298 817,135 $17,838,190 Shares issued in connection with the merger of AGSPC2 Large Cap Growth........... - - 297,894 6,578,574 Reinvestment of distributions.............. 214,569 4,238,969 82,237 1,547,705 Redeemed.................... (395,536) (8,550,664) (159,511) (3,393,150) ---------- ----------- ---------- ----------- Net increase/(decrease).... 361,344 $7,700,603 1,037,755 $22,570,919 ---------- ----------- ---------- ----------- Class A Class B ----------------------- ----------------------- Mid Cap Growth Sold........................ 236,428 $4,958,839 398,588 $8,068,295 Shares issued in connection with the merger of AGSPC2 Mid Cap Growth............. 112,209 2,428,094 326,329 6,785,306 Reinvestment of distributions.............. 152,684 2,771,897 446,218 7,770,631 Redeemed.................... (168,892) (3,635,675) (366,298) (7,489,811) ---------- ----------- ---------- ----------- Net increase/(decrease).... 332,429 $6,523,155 804,837 $15,134,421 ---------- ----------- ---------- ----------- Class C Class I ----------------------- ----------------------- Mid Cap Growth Sold........................ 478,136 $9,593,264 139,968 $3,018,075 Shares issued in connection with the merger of AGSPC2 Mid Cap Growth............. - - 471,490 10,228,987 Reinvestment of distributions.............. 372,559 6,549,451 106,192 1,883,847 Redeemed.................... (559,008) (11,298,090) (69,387) (1,465,582) ---------- ----------- ---------- ----------- Net increase/(decrease).... 291,687 $4,844,625 648,263 $13,665,327 ---------- ----------- ---------- -----------
116 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital -------- ---------- --------- ----------- ---------- ------------ Class A Class B ---------------------- ------------------------ Mid Cap Value Sold.................... 144,253 $1,841,667 472,924 $5,823,819 Reinvestment of distributions.......... 31,579 373,702 88,412 1,029,601 Redeemed................ (118,255) (1,550,678) (384,551) (4,956,358) --------- ----------- ---------- ------------ Net increase/(decrease)... 57,577 $664,691 176,785 $1,897,062 --------- ----------- ---------- ------------ Class C Class I Class II -------------------- ---------------------- ------------------------ Mid Cap Value Sold.................... 43,900 $601,390 1,252,181 $16,290,616 11,121 $137,028 Reinvestment of distributions.......... 2,397 29,983 68,110 845,335 16,112 181,253 Redeemed................ - - (599,402) (7,827,596) (149,144) (1,862,031) -------- ---------- --------- ----------- ---------- ------------ Net increase/(decrease)... 46,297 $631,373 720,889 $9,308,355 (121,911) ($1,543,750) -------- ---------- --------- ----------- ---------- ------------ Class A Class B ---------------------- ------------------------ Science & Technology Sold.................... 604,655 $5,510,690 2,111,172 $18,832,737 Redeemed................ (32,401) (283,380) (138,114) (1,184,568) --------- ----------- ---------- ------------ Net increase/(decrease)... 572,254 $5,227,310 1,973,058 $17,648,169 --------- ----------- ---------- ------------ Class C Class I ---------------------- ------------------------ Science & Technology Sold.................... 136,418 $1,133,849 66,676 $666,741 Redeemed................ (234) (1,808) - - --------- ----------- ---------- ------------ Net increase/(decrease)... 136,184 $1,132,041 66,676 $666,741 --------- ----------- ---------- ------------ Class A Class B ---------------------- ------------------------ Small Cap Growth Sold.................... 179,013 $3,493,309 256,423 $4,499,113 Shares issued in connection with the merger of AGSPC2 Small Cap Growth............. 257,697 5,093,883 754,012 14,548,655 Reinvestment of distributions.......... 21,216 354,265 50,039 812,730 Redeemed................ (81,989) (1,648,781) (246,538) (4,858,401) --------- ----------- ---------- ------------ Net increase/(decrease)... 375,937 $7,292,693 813,936 $15,002,097 --------- ----------- ---------- ------------ Class C Class I ---------------------- ------------------------ Small Cap Growth Sold.................... 185,962 $3,432,164 434,971 $8,306,602 Shares issued in connection with the merger of AGSPC2 Small Cap Growth............. - - 469,456 9,303,218 Reinvestment of distributions.......... 11,278 182,974 45,510 762,287 Redeemed................ (33,565) (598,912) (133,113) (2,503,418) --------- ----------- ---------- ------------ Net increase/(decrease)... 163,675 $3,016,226 816,824 $15,868,689 --------- ----------- ---------- ------------ Class A Class B Class C -------------------- ---------------------- ------------------------ Stock Index Sold.................... 257,610 $3,300,025 1,030,761 $13,150,515 39,852 $506,404 Reinvestment of distributions.......... 7,328 94,341 11,656 148,815 1 19 Redeemed................ (52,165) (667,516) (296,871) (3,762,586) - - -------- ---------- --------- ----------- ---------- ------------ Net increase/(decrease)... 212,773 $2,726,850 745,546 $9,536,744 39,853 $506,423 -------- ---------- --------- ----------- ---------- ------------ Class A Class B Class C -------------------- ---------------------- ------------------------ Global Equity Sold.................... 561,515 $6,564,695 61,443 $779,179 2,354,014 $29,022,558 Reinvestment of distributions.......... 102,952 1,452,654 223,719 3,087,303 391,138 5,421,137 Redeemed................ (676,962) (8,745,579) (952,125) (12,058,568) (3,783,257) (47,863,041) -------- ---------- --------- ----------- ---------- ------------ Net increase/(decrease)... (12,495) ($728,230) (666,963) ($8,192,086) (1,038,105) ($13,419,346) -------- ---------- --------- ----------- ---------- ------------
117 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital --------- ----------- ---------- ------------ ---------- ----------- Class A Class B ------------------------ ----------------------- International Equity Sold.................... 752,978 $8,539,000 223,968 $2,565,738 Shares issued in connection with the merger of AGSPC2 International Growth.... 241,933 2,836,359 540,423 6,262,957 Shares issued in connection with the merger of AGSPC2 International Value..... 275,839 3,233,635 577,643 6,694,306 Reinvestment of distributions........... 27,241 318,993 85,506 992,722 Redeemed................ (921,853) (10,575,559) (883,545) (10,072,806) ---------- ------------ ---------- ----------- Net increase/(decrease).... 376,138 $4,352,428 543,995 $6,442,917 ---------- ------------ ---------- ----------- Class C Class I ------------------------ ----------------------- International Equity Sold.................... 162,734 $1,895,481 998,106 $11,225,802 Shares issued in connection with the merger of AGSPC2 International Growth.... - - 362,776 4,259,720 Shares issued in connection with the merger of AGSPC2 International Value..... - - 505,421 5,934,659 Reinvestment of distributions........... 40,660 472,060 - - Redeemed................ (310,335) (3,546,141) (276,032) (2,977,809) ---------- ------------ ---------- ----------- Net increase/(decrease).... (106,941) ($1,178,600) 1,590,271 $18,442,372 ---------- ------------ ---------- ----------- Class A Class B Class C ----------------------- ------------------------ ----------------------- International Small Cap Sold.................... 617,132 $15,273,632 302,823 $7,405,887 354,827 $9,376,657 Reinvestment of distributions........... 28,290 633,967 75,949 1,644,481 61,882 1,343,520 Redeemed................ (455,514) (11,482,589) (149,996) (3,534,129) (207,100) (4,854,566) --------- ----------- ---------- ------------ ---------- ----------- Net increase/(decrease).... 189,908 $4,425,010 228,776 $5,516,239 209,609 $5,865,611 --------- ----------- ---------- ------------ ---------- ----------- Class A Class B ------------------------ ----------------------- Balanced Sold.................... 239,789 $2,221,399 169,192 $1,578,042 Shares issued in connection with the merger of AGSPC2 Balanced................ 260,076 2,429,626 850,413 7,900,334 Reinvestment of distributions........... 97,337 845,859 207,921 1,802,749 Redeemed................ (320,654) (2,974,969) (898,843) (8,259,026) ---------- ------------ ---------- ----------- Net increase/(decrease).... 276,548 $2,521,915 328,683 $3,022,099 ---------- ------------ ---------- ----------- Class C Class I ------------------------ ----------------------- Balanced Sold.................... 147,231 $1,400,824 206,780 $1,973,415 Shares issued in connection with the merger of AGSPC2 Balanced................ - - 448,772 4,196,897 Reinvestment of distributions........... 787,946 6,942,381 - - Redeemed................ (2,057,592) (19,112,110) (28,756) (271,671) ---------- ------------ ---------- ----------- Net increase/(decrease).... (1,122,415) ($10,768,905) 626,796 $5,898,641 ---------- ------------ ---------- ----------- Class A Class B ------------------------ ----------------------- Core Bond Sold.................... 86,061 $836,397 61,183 $592,169 Shares issued in connection with the merger of AGSPC2 Core Bond.................... 18,563 178,964 49,200 474,337 Shares issued in connection with the merger of AGSPC2 Domestic Bond........... 340,668 3,284,382 1,140,806 10,998,835 Reinvestment of distributions........... 18,168 175,504 24,870 240,124 Redeemed................ (417,481) (4,015,632) (1,197,400) (11,469,196) ---------- ------------ ---------- ----------- Net increase/(decrease).... 45,979 $459,615 78,659 $836,269 ---------- ------------ ---------- -----------
118 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital --------- ----------- ---------- ----------- ---------- ------------ Class C Class I Class II ----------------------- ----------------------- ------------------------ Core Bond Sold.................... 46,061 $448,966 1,808,854 $17,383,782 8 $75 Shares issued in connection with the merger of AGSPC2 Core Bond.................... - - 23,609 235,590 33,038,051 318,569,797 Shares issued in connection with the merger of AGSPC2 Domestic Bond........... - - 693,472 6,688,535 - - Reinvestment of distributions........... 19,488 188,367 40,452 391,593 700,635 6,764,917 Redeemed................ (242,315) (2,350,556) (491,180) (4,754,531) (622,731) (6,000,000) --------- ----------- ---------- ----------- ---------- ------------ Net increase/(decrease).... (176,766) ($1,713,223) 2,075,207 $19,937,089 33,115,963 $319,334,789 --------- ----------- ---------- ----------- ---------- ------------ Class A Class B ----------------------- ------------------------ High Yield Bond Sold.................... 32,163 $300,163 122,781 $1,123,161 Reinvestment of distributions........... 1,170 10,572 8,193 73,989 Redeemed................ (3,512) (33,029) (13,772) (123,026) ---------- ----------- ---------- ------------ Net increase/(decrease).... 29,821 $277,706 117,202 $1,074,124 ---------- ----------- ---------- ------------ Class C Class I Class II ----------------------- ----------------------- ------------------------ High Yield Bond Sold.................... 63,079 $567,367 1,605 $14,414 7,091,254 $63,681,758 Reinvestment of distributions........... 601 5,208 150 1,368 704,361 6,390,330 Redeemed................ - - (1,596) (14,336) (7,088,114) (63,648,633) --------- ----------- ---------- ----------- ---------- ------------ Net increase/(decrease).... 63,680 $572,575 159 $1,446 707,501 $6,423,455 --------- ----------- ---------- ----------- ---------- ------------ Class A Class B Class C ----------------------- ----------------------- ------------------------ Municipal Bond Sold.................... 138,950 $1,317,668 9,870 $94,254 1,628 $15,403 Shares issued in connection with the merger of AGSPC2 Municipal Bond.......... 344,682 3,290,627 414,403 3,955,889 - - Reinvestment of distributions........... 16,903 160,992 13,996 133,257 7,966 75,353 Redeemed................ (162,218) (1,539,938) (215,733) (2,051,175) (185,975) (1,760,691) --------- ----------- ---------- ----------- ---------- ------------ Net increase/(decrease).... 338,317 $3,229,349 222,536 $2,132,225 (176,381) ($1,669,935) --------- ----------- ---------- ----------- ---------- ------------ Class A Class B ----------------------- ------------------------ Strategic Income Sold.................... 235,425 $1,934,596 188,191 $1,554,585 Shares issued in connection with the merger of AGSPC2 Strategic Bond.......... 210,906 1,732,804 266,623 2,190,838 Reinvestment of distributions........... 53,247 440,576 118,611 981,318 Redeemed................ (765,027) (6,343,100) (1,218,211) (10,106,970) ---------- ----------- ---------- ------------ Net increase/(decrease).... (265,449) ($2,235,124) (644,786) ($5,380,229) ---------- ----------- ---------- ------------ Class C Class I ----------------------- ------------------------ Strategic Income Sold.................... 194,141 $1,597,500 9 $75 Shares issued in connection with the merger of AGSPC2 Strategic Bond.......... - - 328,991 2,705,249 Reinvestment of distributions........... 110,714 916,823 8,751 69,194 Redeemed................ (1,138,865) (9,482,491) (8,294) (67,939) ---------- ----------- ---------- ------------ Net increase/(decrease).... (834,010) ($6,968,168) 329,457 ($2,706,579) ---------- ----------- ---------- ------------ Class A Class B Class C ----------------------- ----------------------- ------------------------ U.S. Government Securities Sold.................... 260,706 $2,454,069 251,432 $2,371,338 2,953,663 $27,736,875 Reinvestment of distributions........... 132,162 1,124,755 41,149 348,322 44,282 374,449 Redeemed................ (994,682) (9,334,232) (675,339) (6,148,543) (3,404,934) (31,970,103) --------- ----------- ---------- ----------- ---------- ------------ Net increase/(decrease).... (601,814) ($5,755,408) (382,758) ($3,428,883) (406,989) ($3,858,779) --------- ----------- ---------- ----------- ---------- ------------
119 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - -------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital ---------- ---------- ----------- ----------- ----------- ----------- Class A Class B ------------------------- ------------------------- Money Market Sold.................... 35,256,844 $35,256,844 10,939,422 $10,939,422 Shares issued in connection with the merger of AGSPC2 Money Market................. 16,037,970 16,037,970 4,757,994 4,757,994 Reinvestment of distributions.......... 732,440 732,440 268,711 268,711 Redeemed................ (32,448,147) (32,448,147) (12,420,665) (12,420,665) ----------- ----------- ----------- ----------- Net increase/(decrease).... 19,579,107 $19,579,107 3,545,462 $3,545,462 ----------- ----------- ----------- ----------- Class C Class I ------------------------- ------------------------- Money Market Sold.................... 30,703,970 $30,703,970 2,867,349 $2,867,349 Shares issued in connection with the merger of AGSPC2 Money Market................. - - 5,610,626 5,610,626 Reinvestment of distributions.......... 371,257 371,257 108,376 108,376 Redeemed................ (32,524,278) (32,524,278) (2,475,554) (2,461,485) ----------- ----------- ----------- ----------- Net increase/(decrease).... (1,449,051) $(1,449,051) 6,110,797 $6,124,866 ----------- ----------- ----------- ----------- Class A Class B Class C ---------------------- ------------------------- ------------------------- Municipal Money Market Sold.................... 2,115,643 $2,115,642 416,013 $416,013 112,080 $112,080 Reinvestment of distributions.......... 86,176 86,176 43,881 43,882 235 235 Redeemed................ (1,401,118) (1,401,118) (524,290) (524,290) (4,000) (4,000) ---------- ---------- ----------- ----------- ----------- ----------- Net increase/(decrease).... 800,701 $800,700 (64,396) $(64,395) 108,314 $108,314 ---------- ---------- ----------- ----------- ----------- ----------- Class A Class B ------------------------- ------------------------- Aggressive Growth LifeStyle Sold.................... 154,794 $2,051,325 657,584 $8,804,810 Reinvestment of distributions.......... 19,409 250,862 58,467 692,034 Redeemed................ (16,440) (218,429) (72,094) (957,709) ----------- ----------- ----------- ----------- Net increase/(decrease).... 157,763 $2,083,758 643,957 $8,539,135 ----------- ----------- ----------- ----------- Class C Class I Class II ---------------------- ------------------------- ------------------------- Aggressive Growth LifeStyle Sold.................... 14,397 $188,274 629,278 $8,586,698 8 $100 Reinvestment of distributions.......... - - 21,903 282,055 5,380 71,165 Redeemed................ - - (387,895) (5,353,647) (131,036) (1,765,000) ---------- ---------- ----------- ----------- ----------- ----------- Net increase/(decrease).... 14,397 $188,274 263,286 $3,515,106 (125,648) $(1,693,735) ---------- ---------- ----------- ----------- ----------- ----------- Class A Class B ------------------------- ------------------------- Moderate Growth LifeStyle Sold.................... 118,463 $1,454,170 538,571 $6,583,591 Reinvestment of distributions.......... 15,307 185,162 46,680 565,594 Redeemed................ (20,669) (251,696) (91,454) (1,118,453) ----------- ----------- ----------- ----------- Net increase/(decrease).... 113,101 $1,387,636 493,797 $6,030,732 ----------- ----------- ----------- ----------- Class C Class I Class II ---------------------- ------------------------- ------------------------- Moderate Growth LifeStyle Sold.................... 15,078 $188,489 740,368 $9,290,421 8 $100 Reinvestment of distributions.......... 16 187 18,336 221,379 4,909 59,739 Redeemed................ - - (442,764) (5,612,543) (131,311) (1,628,183) ---------- ---------- ----------- ----------- ----------- ----------- Net increase/(decrease).... 15,094 $188,676 315,940 $3,899,257 (126,394) $(1,568,344) ---------- ---------- ----------- ----------- ----------- ----------- Class A Class B ------------------------- ------------------------- Conservative Growth LifeStyle Sold.................... 132,543 $1,548,028 363,073 $4,240,024 Reinvestment of distributions.......... 12,294 141,683 40,395 466,977 Redeemed................ (11,888) (138,955) (44,929) (528,305) ----------- ----------- ----------- ----------- Net increase/(decrease).... 132,949 $1,550,756 358,539 $4,178,696 ----------- ----------- ----------- -----------
120 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 3 - continued
Shares Capital Shares Capital Shares Capital --------- --------- --------- ---------- --------- ----------- Conservative Growth Class C Class I Class II LifeStyle --------------------- ---------------------- ----------------------- Sold.................... 12,844 $152,493 662,195 $7,849,117 9 $100 Reinvestment of distributions........... - - 14,757 170,114 4,837 55,734 Redeemed................ - - (426,915) (5,103,384) (132,197) (1,547,920) --------- --------- --------- ---------- --------- ----------- Net increase/(decrease).... 12,844 $152,493 250,037 $2,915,847 (127,351) ($1,492,086) --------- --------- --------- ---------- --------- -----------
4. PURCHASES AND SALES OF SECURITIES. The following table summarizes the securities transactions (excluding short-term investments) for all portfolios, excluding Money Market and Municipal Money Market, for the year ended October 31, 2001:
Purchases Sales ------------------------------ ------------------------------ Portfolio U. S. Government Other Issues U. S. Government Other Issues - ------------ ---------------- ------------- ---------------- ------------- Growth & Income......... $91,893,641 $120,724,628 Large Cap Growth........ 102,302,564 104,410,087 Mid Cap Growth.......... 33,942,110 34,583,370 Mid Cap Value........... 68,490,805 58,792,871 Science & Technology.... 28,217,293 20,455,728 Small Cap Growth........ 33,437,004 27,855,299 Stock Index............. 8,646,980 859,933 Global Equity........... 30,436,320 40,452,928 International Equity.... 14,409,839 14,909,808 International Small Cap..................... 107,870,870 116,906,054 Balanced................ $4,390,041 29,056,650 $4,847,038 34,848,804 Core Bond............... 680,859,150 1,190,112,374 600,725,561 1,266,070,977 High Yield Bond......... 68,165,183 52,182,466 Municipal Bond.......... 81,318,949 82,466,016 Strategic Income........ 1,019,476 18,854,128 3,475,410 17,602,664 U.S. Government Securities.............. 211,595,275 4,573,948 206,946,065 2,676,332 Aggressive Growth LifeStyle............... 26,043,745 19,572,102 Moderate Growth LifeStyle............... 30,903,055 19,690,344 Conservative Growth LifeStyle............... 20,182,601 16,329,252
At October 31, 2001, tax basis net unrealized appreciation was equal to the aggregate gross unrealized appreciation for all securities in which there was an excess of market value over tax cost and aggregate gross unrealized depreciation for all securities in which there was an excess of tax cost over market value as follows:
Tax Basis Net Unrealized Tax Basis Tax Basis Tax Basis Appreciation Unrealized Unrealized Portfolio Cost (Depreciation) Appreciation Depreciation - ------------ ------------ -------------- ------------ ------------ Growth & Income......... $227,019,786 $ 3,527,460 $33,951,796 ($30,424,336) Large Cap Growth........ 52,757,066 (6,929,664) 1,018,110 (7,947,774) Mid Cap Growth.......... 50,542,675 (17,607,613) 2,478,769 (20,086,382) Mid Cap Value........... 31,046,280 (1,382,789) 851,203 (2,233,992) Science & Technology.... 20,286,883 (6,629,799) 255,848 (6,885,647) Small Cap Growth........ 35,156,570 (4,948,635) 2,380,160 (7,328,795) Stock Index............. 37,830,963 (6,935,108) 1,471,442 (8,406,550) Global Equity........... 18,131,890 (2,114,799) 524,191 (2,638,990) International Equity.... 48,423,714 (11,692,071) 847,776 (12,539,847) International Small Cap..................... 10,086,199 (108,848) 375,173 (484,021) Balanced................ 48,372,728 (4,277,729) 1,792,853 (6,070,582) Core Bond............... 442,098,869 11,349,535 15,510,316 (4,160,781)
121 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 4 - continued
Tax Basis Net Unrealized Tax Basis Tax Basis Tax Basis Appreciation Unrealized Unrealized Portfolio Cost (Depreciation) Appreciation Depreciation - ------------ ----------- -------------- ------------ ------------ High Yield Bond.......... $73,944,393 ($4,829,974) $2,534,494 ($7,364,468) Municipal Bond........... 15,628,015 700,921 700,921 - Strategic Income......... 34,660,699 (1,187,733) 1,708,539 (2,896,272) U.S. Government Securities............... 65,534,610 1,510,824 1,518,104 (7,280) Aggressive Growth LifeStyle................ 30,828,210 (8,913,229) 60,573 (8,973,802) Moderate Growth LifeStyle................ 32,427,911 (5,708,119) 283,285 (5,991,404) Conservative Growth LifeStyle................ 22,242,300 (2,816,120) 424,787 (3,240,907)
5. INVESTMENT ADVISORY AGREEMENT. The Trust maintains an Investment Advisory Agreement with AGAM, pursuant to approval by the Trust's Board of Trustees and shareholders. AGAM is responsible for managing the corporate and business affairs of the Trust and for selecting and compensating subadvisers to handle the investment and reinvestment of the assets of each portfolio, subject to the supervision of the Trustees of the Trust. As compensation for its services, AGAM receives a fee from the Trust computed separately for each portfolio at an annual percentage of average net assets as follows:
Between Between $50 million $200 million First and and Excess over Portfolio $50 million $200 million $500 million $500 million - ------------ ------------ ------------ ------------ ------------ Growth & Income........... .725% .675% .625% .550% Large Cap Growth.......... .900% .850% .825% .800% Mid Cap Growth............ .925% .900% .875% .850% Mid Cap Value............. See below/1/ Science & Technology...... .900% .900% .900% .900% Small Cap Growth.......... .950% .950% .950% .950% Stock Index............... .270% .270% .270% .260% Global Equity............. .900% .900% .700% .700% International Equity...... .900% .850% .800% .750% International Small Cap... 1.050% 1.000% .900% .800% Balanced.................. .775% .725% .675% .625% Core Bond................. .600% .600% .525% .475% High Yield Bond........... .825% .825% .725% .675% Municipal Bond............ .600% .600% .600% .600% Strategic Income.......... .750% .700% .650% .600% U.S. Government Securities................ .600% .600% .525% .475% Money Market.............. .200% .200% .200% .145% Municipal Money Market.... .350% .350% .350% .350% Aggressive Growth LifeStyle................. .100% .100% .100% .100% Moderate Growth LifeStyle................. .100% .100% .100% .100% Conservative Growth LifeStyle................. .100% .100% .100% .100%
/1/The Management fee schedule for the Mid Cap Value Fund is as follows: 0.900% on the first $100 million, 0.875% between $100 million and $250 million, 0.850% between $250 million and $500 million, 0.825% between $500 million and $750 million, and 0.800% on the excess over $750 million of the average net assets of the Fund. For the year ended October 31, 2001, AGAM paid aggregate subadvisory fees of $3,946,027. In addition, AGAM retained net investment advisory fees of $4,445,178 after payment of subadvisory fees, which were allocated among the portfolios as follows: 122 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 5 - continued
Fee % of Net Assets Fee % of Net Assets Paid to Paid to Retained Retained Portfolio Sub-adviser Sub-adviser by AGAM by AGAM - ------------ ----------- --------------- ---------- --------------- Growth & Income......... $750,377 0.27% $1,111,782 0.40% Large Cap Growth........ 301,542 0.49% 246,016 0.40% Mid Cap Growth.......... 266,104 0.52% 203,743 0.40% Mid Cap Value........... 140,996 0.50% 112,797 0.40% Science & Technology.... 102,032 0.58% 52,823 0.30% Small Cap Growth........ 182,214 0.55% 132,519 0.40% Stock Index............. 6,600* 0.02% 82,253 0.25% Global Equity........... 122,278 0.50% 97,822 0.40% International Equity.... 219,273 0.50% 175,395 0.40% International Small Cap..................... 120,562 0.65% 74,184 0.40% Balanced................ 205,400 0.37% 222,508 0.40% Core Bond............... 816,196* 0.23% 1,213,861 0.34% High Yield Bond......... 308,448* 0.45% 256,975 0.37% Municipal Bond.......... 46,470* 0.25% 65,059 0.35% Strategic Income........ 123,631* 0.35% 141,280 0.40% U.S. Government Securities.............. 111,066* 0.22% 185,102 0.37% Money Market............ 38,365* 0.08% 64,032 0.12% Municipal Money Market.................. 17,524* 0.25% 7,027 0.10% Aggressive Growth LifeStyle............... 22,571* 0.10% - - Moderate Growth LifeStyle............... 25,037* 0.10% - - Conservative Growth LifeStyle............... 19,341* 0.10% - -
* Fund is sub-advised by American General Investment Management, Inc., a wholly-owned indirect subsidiary of American General Corporation. Expense Reimbursement and Distribution Plan. Pursuant to the Investment Advisory Agreement, AGAM will reduce the advisory fee, or, if necessary, reimburse each portfolio of the Trust for expenses (excluding taxes, portfolio brokerage commissions, interest, certain litigation and indemnification expenses and extraordinary expenses) incurred through February 28, 2002, in excess of the following annual percentages of average net assets as highlighted in the table below (expense limitation). AGAM may later recapture expenses it deferred or reimbursed during the three prior fiscal years in the event the fund's actual expenses are less than the expense limitation.
Class A Class B Class C Class I Class II ------- ------- ------- ------- -------- Growth & Income........................ 1.46% 2.11% 2.11% 1.36% Large Cap Growth....................... 1.37% 2.02% 2.02% 1.27% Mid Cap Growth......................... 1.53% 2.18% 2.18% 1.43% Mid Cap Value.......................... 1.78% 2.43% 2.43% 1.68% Science & Technology................... 1.50% 2.15% 2.15% 1.40% Small Cap Growth....................... 1.60% 2.25% 2.25% 1.50% Stock Index............................ 0.75% 1.40% 1.40% 0.65% Global Equity.......................... 2.17% 2.82% 2.82% 2.07% International Equity................... 1.70% 2.35% 2.35% 1.60% International Small Cap................ 1.95% 2.60% 2.60% 1.85% Balanced............................... 1.71% 2.36% 2.36% 1.61% Core Bond.............................. 1.33% 1.98% 1.98% 1.23% 0.98% High Yield Bond........................ 1.57% 2.22% 2.22% 1.47% 1.15% Municipal Bond......................... 1.05% 1.90% 1.90% Strategic Income....................... 1.57% 2.22% 2.22% 1.47%
123 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 5 - continued
Class A Class B Class C Class I Class II ------- ------- ------- ------- -------- U.S. Government Securities............ 1.30% 1.95% 1.95% 1.20% Money Market.......................... 0.80% 0.80% 0.80% 0.80% Municipal Money Market................ 0.80% 0.80% 0.80% Aggressive Growth LifeStyle........... 0.20% 0.85% 0.85% 0.10% Moderate Growth LifeStyle............. 0.20% 0.85% 0.85% 0.10% Conservative Growth LifeStyle......... 0.20% 0.85% 0.85% 0.10%
Prior to March 1, 2001, the funds' expense limitation percentages were as follows:
Class A Class B Class C Class I Class II ------- ------- ------- ------- -------- Growth & Income....................... 1.46% 2.11% 2.11% 1.23% Large Cap Growth ..................... 1.17% 1.82% 1.82% 1.07% Mid Cap Growth........................ 1.48% 2.13% 2.13% 1.38% Mid Cap Value......................... 1.78% 2.43% 2.43% 1.68% Science & Technology.................. 1.10% 1.75% 1.75% 1.00% Small Cap Growth...................... 1.22% 1.87% 1.87% 1.12% Stock Index........................... 0.70% 1.35% 1.35% 0.60% Global Equity......................... 1.87% 2.52% 2.52% 1.65% International Equity.................. 1.50% 2.15% 2.15% 1.40% International Small Cap............... 1.85% 2.50% 2.50% 1.75% Balanced.............................. 1.51% 2.16% 2.16% 1.41% Core Bond............................. 1.30% 1.95% 1.95% 1.20% 0.95% High Yield Bond....................... 1.55% 2.20% 2.20% 1.45% 1.13% Municipal Bond........................ 1.00% 1.85% 1.85% Strategic Income...................... 1.55% 2.20% 2.20% 1.45% U.S. Government Securities............ 1.25% 1.90% 1.90% 1.15% Money Market.......................... 0.70% 0.70% 0.70% 0.70% Municipal Money Market................ 0.75% 0.75% 0.75% Aggressive Growth LifeStyle........... 0.20% 0.85% 0.85% 0.10% Moderate Growth LifeStyle............. 0.20% 0.85% 0.85% 0.10% Conservative Growth LifeStyle......... 0.20% 0.85% 0.85% 0.10%
The Trust has adopted a distribution plan (the "Plan") pursuant to Rule 12b-1 under the Investment Company Act to use its assets to finance certain activities relating to the distribution of its shares to investors. The Plan is a "compensation" plan providing for the payment by each portfolio, other than Money Market and Municipal Money Market, of a monthly distribution fee to AGFD as principal underwriter for the Trust as follows: 0.35% of average daily net assets, except for Municipal Bond, which charges 0.15% of average daily Class A net assets Class B 1.00% of average daily net assets Class C 1.00% of average daily net assets
The amounts payable by Aggressive Growth LifeStyle, Moderate Growth LifeStyle and Conservative Growth LifeStyle ("LifeStyle Funds") under the Plan will be reduced by any amounts payable with respect to the Institutional Class I Shares of each Portfolio in which a LifeStyle Fund invests, pursuant to the Administrative and Shareholder Services Agreement dated July 7, 2000, between the LifeStyle Funds and AGAM. Under the Administrative and Shareholder Services Agreement, Class I Shares are subject to a 0.25% Service Fee. 124 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 5 - continued In accordance with the Investment Advisory agreement, AGAM, in addition to providing advisory services, provides accounting and administrative services for which AGAM charged $1,158,712 to the Trust, before reimbursement based on expense limitations, for the year ended October 31, 2001. AGFD received $163,408 in front-end sales charges and $830,931 in contingent deferred sales charges during the period. At October 31, 2001, the American General Retirement Plan, a Defined Benefit Pension Plan sponsored by American General Corporation, owned directly or indirectly 89% of the outstanding shares of Core Bond and 87% of the outstanding shares of High Yield Bond. At October 31, 2001, the Variable Annuity and Life Insurance Company, an indirect wholly-owned subsidiary of American General Corporation, owned over 5% of the outstanding shares of Mid Cap Growth, Mid Cap Value, Small Cap Growth, Stock Index, International Equity, Balanced, Municipal Bond, Strategic Income, Municipal Money Market, Aggressive Growth LifeStyle, Moderate Growth LifeStyle and Conservative Growth LifeStyle. In addition, at October 31, 2001, one shareholder owned over 5% of the outstanding shares of Growth & Income, Large Cap Growth, Small Cap Growth and Moderate Growth LifeStyle. Aggressive Growth LifeStyle owned over 5% of the outstanding shares of Large Cap Growth, Mid Cap Value, Small Cap Growth and International Equity; Moderate Growth LifeStyle owned over 5% of the outstanding shares of Large Cap Growth, Mid Cap Value, Small Cap Growth and International Equity. Conservative Growth LifeStyle owned over 5% of the outstanding shares of International Equity. 6. TRUSTEE'S FEES. The Trust pays each Trustee who is not an employee or a director of the Adviser or its affiliates a fee of $900 plus travel expenses for each Board of Trustees meeting attended and an annual retainer of $3,600. The Trust provides a retirement plan for its independent directors who are not officers, directors, or employees of AGAM, or an affiliate of AGAM. The Trust is responsible for the payment of the retirement benefits, as well as all expenses of administration of the plan. Benefits vested under the plan are payable for a ten-year period upon retirement and are based on each director's years of service. No benefits are currently payable to the Trustees. 7. LINE OF CREDIT. The Trust has entered into an agreement with Fleet Bank that provides a $20,000,000 Line of Credit to the Trust which may be used for temporary or emergency purposes. The Trust pays a commitment fee annually, and interest is charged on any borrowed amounts at the currently effective Federal Funds Rate plus .55%. The Line of Credit was not used during the year ended October 31, 2001. 8. FUTURES CONTRACTS. Futures contracts outstanding at October 31, 2001, were as follows:
Net Unrealized Aggregate Expiration Total Appreciation Face Value Date Value (Depreciation) ---------- ---------- ---------- -------------- Stock Index S&P Mini 500 Index (Long)... $2,270,712 12/01/01 $2,280,504 $9,792 International Equity DJ Euro Stoxx 50 Index (Long)...................... $353,313 12/01/01 $344,408 ($8,905) FTSE 200 Index (Long)....... 377,317 12/01/01 365,717 (11,600) Hang Seng Stock Index (Short)..................... (199,638) 11/01/01 (192,942) 6,696 Dax Index (Short)........... (474,460) 12/01/01 (514,766) (40,306) Topix Index (Short)......... (647,272) 12/01/01 (689,705) (42,433) ---------- ---------- -------- ($590,740) ($687,288) ($96,548) ---------- ---------- --------
125 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 5 - continued 9. CUSTODY ACCOUNT BALANCES. The Trust's custodian bank has agreed to reduce its fees when the portfolios maintain cash in their custody accounts, which are non-interest-bearing. For the year ended October 31, 2001, custodian fee offset arrangements reduced expenses of the Trust by $17,845. 10. ACQUISITIONS. On July 10, 2000, certain portfolios, as listed below, (each an "Acquiring Fund" acquired the assets and certain liabilities of other funds, also listed below, (each an "Acquiring Fund") in tax-free exchanges approved by the shareholders. The number and value of shares issued by the Acquiring Fund are presented in the schedule of Capital Stock Activity (Note 3). Net asset and unrealized appreciation (depreciation) as of the reorganization date were as follows: Acquisition of AGSPC2 Money Market Fund by the North American Money Market Fund: Net Assets of North American Money Market prior to merger........ $19,870,100 Net Assets of AGSPC2 Money Market prior to merger................ $26,406,587 Aggregate net assets of North American Money Market immediately following the acquisition........................................ $46,276,687 Acquisition of AGSPC2 Core Bond Fund and the AGSPC2 Domestic Bond Fund by the North American Core Bond Fund: Net Assets of North American Core Bond prior to merger........... $9,221,390 Net Assets of AGSPC2 Core Bond prior to merger................... $319,450,486 Net Assets of AGSPC2 Domestic Bond prior to merger............... $20,971,752 Aggregate net assets of North American Core Bond immediately following the acquisitions....................................... $349,643,628 Unrealized depreciation in AGSPC2 Core Bond...................... $7,569,361 Unrealized depreciation in AGSPC2 Domestic Bond.................. $213,402 Acquisition of the North American Equity-Income Fund, the North American Tax- Sensitive Equity Fund, and the AGSPC2 Large Cap Value Fund by the North American Growth & Income Fund: Net Assets of North American Growth & Income prior to merger..... $285,707,092 Net Assets of North American Equity-Income prior to merger....... $64,486,260 Net Assets of North American Tax-Sensitive Equity prior to merger........................................................... $4,816,365 Net Assets of AGSPC2 Large Cap Value prior to merger............. $14,797,818 Aggregate net assets of North American Growth & Income immediately following the acquisitions........................... $369,807,535 Unrealized appreciation in North American Equity-Income.......... $3,612,632 Unrealized appreciation in North American Tax-Sensitive Equity... $1,361,977 Unrealized appreciation in AGSPC2 Large Cap Value................ $548,794 Acquisition of AGSPC2 Balanced Fund by the North American Balanced Fund: Net Assets of North American Balanced prior to merger............ $53,829,259 Net Assets of AGSPC2 Balanced prior to merger.................... $14,526,857 Aggregate net assets of North American Balanced immediately following the acquisition........................................ $68,356,116 Unrealized appreciation in AGSPC2 Balanced....................... $1,064,064 Acquisition of AGSPC2 Municipal Bond Fund by the North American Municipal Bond Fund: Net Assets of North American Municipal Bond prior to merger...... $10,011,129 Net Assets of AGSPC2 Municipal Bond prior to merger.............. $7,246,516 Aggregate net assets of North American Municipal Bond immediately following the acquisition........................................ $17,257,645 Unrealized depreciation in AGSPC2 Municipal Bond................. $294,879
126 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- Note 10 - continued Acquisition of AGSPC2 International Growth Fund and the AGSPC2 International Value Fund by the North American International Equity Fund: Net Assets of North American International Equity prior to merger............................................................ $24,631,389 Net Assets of AGSPC2 International Growth prior to merger......... $13,359,036 Net Assets of AGSPC2 International Value prior to merger.......... $15,862,600 Aggregate net assets of North American International Equity immediately following the acquisition............................. $53,853,025 Unrealized appreciation in AGSPC2 International Growth............ $2,221,695 Unrealized appreciation in AGSPC2 International Value............. $3,791,004 Acquisition of AGSPC2 Strategic Bond Fund by the North American Strategic Income Fund: Net Assets of North American Strategic Income prior to merger..... $37,517,037 Net Assets of AGSPC2 Strategic Bond prior to merger............... $6,626,303 Aggregate net assets of North American Strategic Income immediately following the acquisition............................. $44,143,340 Unrealized depreciation in AGSPC2 Strategic Bond.................. $134,632 Acquisition of AGSPC2 Mid Cap Growth Fund by the North American Mid Cap Growth Fund: Net Assets of North American Mid Cap Growth prior to merger....... $56,193,139 Net Assets of AGSPC2 Mid Cap Growth prior to merger............... $19,442,387 Aggregate net assets of North American Mid Cap Growth immediately following the acquisition......................................... $75,635,526 Unrealized appreciation in AGSPC2 Mid Cap Growth.................. $2,332,158 Acquisition of AGSPC2 Large Cap Growth Fund by the North American Large Cap Growth Fund: Net Assets of North American Large Cap Growth prior to merger..... $55,136,766 Net Assets of AGSPC2 Large Cap Growth prior to merger............. $31,612,521 Aggregate net assets of North American Large Cap Growth immediately following the acquisition............................. $86,749,287 Unrealized appreciation in AGSPC2 Large Cap Growth................ $4,904,896 Acquisition of AGSPC2 Small Cap Growth Fund by the North American Small Cap Growth Fund: Net Assets of North American Small Cap Growth prior to merger..... $6,647,129 Net Assets of AGSPC2 Small Cap Growth prior to merger............. $28,945,756 Aggregate net assets of North American Small Cap Growth immediately following the acquisition............................. $35,592,885 Unrealized appreciation in AGSPC2 Small Cap Growth................ $5,088,462
On July 10, 2000, certain newly established portfolios, as listed below (each an "Acquiring Fund"), acquired the assets and liabilities of certain funds or portfolios, also listed below (each an "Acquired Portfolio") pursuant to a plan of reorganization approved by its shareholders. The reorganization was accomplished by a tax-free exchange for shares of the Acquiring Fund in an amount equal to the outstanding interests of the Acquired Portfolio.
Acquired Portfolio Acquiring Fund ------------------ Mid Cap Value AGSPC2 Mid Cap Value Science & Technology AGSPC2 Science & Technology Stock Index AGSPC2 Stock Index High Yield Bond AGSPC2 High Yield Bond Municipal Money Market AGSPC2 Municipal Money Market Aggressive Growth LifeStyle AGSPC2 Aggressive Growth Lifestyle Moderate Growth LifeStyle AGSPC2 Moderate Growth Lifestyle Conservative Growth LifeStyle AGSPC2 Conservative Growth Lifestyle
127 NORTH AMERICAN FUNDS NOTES TO FINANCIAL STATEMENTS - ------------------------------------------------------------------------------- 11. SUBSEQUENT EVENT. On November 16, 2001, all of the portfolios of the North American Funds were reorganized into various SunAmerica Mutual Funds in tax- free exchanges approved by the shareholders. The funds listed below became part of the existing SunAmerica portfolios as shown: Growth & Income Fund (right arrow) SunAmerica Growth and Income Fund Large Cap Growth Fund (right arrow) SunAmerica Blue Chip Growth Fund Mid Cap Growth Fund (right arrow) SunAmerica Growth Opportunities Fund Mid Cap Value Fund (right arrow) SunAmerica Multi-Cap Value Fund Global Equity Fund (right arrow) SunAmerica International Equity Fund International Equity Fund (right arrow) SunAmerica International Equity Fund International Small Cap Fund (right arrow) SunAmerica International Equity Fund Balanced Fund (right arrow) SunAmerica Balanced Assets Fund High Yield Bond Fund (right arrow) SunAmerica High Yield Bond Fund Municipal Bond Fund (right arrow) SunAmerica Balanced Assets Fund Strategic Income Fund (right arrow) SunAmerica Strategic Income Fund U.S. Government Securities Fund (right arrow) SunAmerica U.S. Government Securities Fund Money Market Fund (right arrow) SunAmerica Money Market Fund On November 16, 2001, certain newly established portfolios, as listed below (each an "Acquiring Fund"), acquired the assets and liabilities of certain portfolios, also listed below (each an "Acquired Portfolio") pursuant to a plan of reorganization approved by its shareholders. The reorganization was accomplished by a tax-free exchange for shares of the Acquiring Fund in an amount equal to the outstanding interests of the Acquired Portfolio.
Acquired Porffolio Acquiring Fund - --------- -------------- Science & Technology Fund (right arrow) SunAmerica Science & Technology Fund Small Cap Growth Fund (right arrow) SunAmerica Small Cap Growth Fund Stock Index Fund (right arrow) SunAmerica Stock Index Fund Core Bond Fund (right arrow) SunAmerica Core Bond Fund Municipal Money Market Fund (right arrow) SunAmerica Municipal Money Market Fund Aggressive Growth LifeStyle Fund (right arrow) SunAmerica Aggressive Growth LifeStage Fund Moderate Growth LifeStyle Fund (right arrow) SunAmerica Moderate Growth LifeStage Fund Conservative Growth LifeStyle Fund (right arrow) SunAmerica Conservative Growth LifeStage Fund
128 NORTH AMERICAN FUNDS OTHER INFORMATION (UNAUDITED) - ------------------------------------------------------------------------------- Capital Gain Distributions (Unaudited) Pursuant to Section 852 of the Internal Revenue Code, the distributions set forth below have been designated as capital gains distributions for the fiscal year ended October 31, 2001:
Capital Gain Portfolio Distribution ------------------------------- ------------ Growth & Income............... $5,857,686 Mid Cap Value................. 530,603
Tax-Exempt Dividends (Unaudited) For the fiscal year ended October 31, 2001, the following funds paid tax- exempt dividends in the amounts shown: Municipal Bond.................... $651,796 Municipal Money Market............ $167,152
129 NORTH AMERICAN FUNDS 286 Congress Street, Boston, MA 02210 www.northamericanfunds.com 151 NAF 1001:90310 -----END PRIVACY-ENHANCED MESSAGE-----