UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file Number: 811-04338
EAGLE CAPITAL APPRECIATION FUND
(Exact name of Registrant as Specified in Charter)
880 Carillon Parkway
St. Petersburg, FL 33716
(Address of Principal Executive Office) (Zip Code)
Registrant’s Telephone Number, including Area Code: (727) 567-8143
RICHARD J. ROSSI, PRESIDENT
880 Carillon Parkway
St. Petersburg, FL 33716
(Name and Address of Agent for Service)
Copy to:
FRANCINE J. ROSENBERGER, ESQ.
K&L Gates, LLP
1601 K Street, NW
Washington, D.C. 20006
Date of fiscal year end: October 31
Date of reporting period: October 31, 2010
Explanatory Note: The Board of Officers were elected November 16, 2010.
| Item 1. | Reports to Shareholders |
EAGLE MUTUAL FUNDS
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| Annual Report | | |
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and Investment Performance Review for the fiscal year ended October 31, 2010 | | |
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| Eagle Capital Appreciation Fund | | |
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| Eagle Growth & Income Fund | | |
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| Eagle International Equity Fund | | |
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| Eagle Investment Grade Bond Fund | | |
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| Eagle Large Cap Core Fund | | |
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| Eagle Mid Cap Growth Fund | | |
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| Eagle Mid Cap Stock Fund | | |
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| Eagle Small Cap Core Value Fund | | |
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| Eagle Small Cap Growth Fund | | |
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| Privacy Notice | | |
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Eagle Family of Funds | | |
| EAGLE | | Family of Funds |
Table of Contents
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President’s Letter
Dear Fellow Shareholders:
I am pleased to present the annual report and investment performance review of the Eagle Family of Funds for the fiscal year ended October 31, 2010 (the “reporting period”). In March 2010, Eagle launched the Investment Grade Bond Fund to offer greater diversification to shareholders.
Major U.S. indices posted solid gains during the reporting period, extending the rally that began in March 2009. Cyclical, higher beta companies saw the biggest gains in their share prices, while growth stocks generally outperformed value stocks. The markets have been encouraged by some indications of economic expansion, improving corporate earnings, currently benign inflation and continued low interest rates.
Significant uncertainty exists regarding the strength of the recovery, which appears to be slower than recoveries from previous recessions. High unemployment and problems in the housing market continue. These negative forces have led to mortgage rates remaining very low.
Internationally, concerns surrounding the European sovereign debt crisis and uncertainty around bank stress tests negatively impacted the markets early in the reporting period. The euro suffered as questions were raised regarding whether it could survive as a common currency. As the year progressed, no European country defaulted and positive stress test results were announced, causing a temporary rally in international equities and the euro. As the reporting period ended, concerns surrounding European debt persisted.
In the commentaries that follow, each fund’s portfolio managers discuss the specific performance in their funds. While performance during the reporting period was encouraging and positive signs of economic growth are present, it bears remembering that markets remain volatile. During the reporting period, there were two notable corrections
in the equity markets. Market corrections and movement can create opportunities for long-term, fundamental stock picking over time.
In an effort to save costs and reduce environmental impact, Eagle is able to offer many reports electronically. If you would like to begin receiving this report and other reports from the Eagle Family of Funds electronically, please visit our website, eagleasset.com, and enroll for electronic delivery. Doing so will reduce the amount of paper we consume which saves the Funds (and their shareholders) money and will help the environment. Enrolling in this service will not affect the delivery of your account statements or other confidential communications.
I would like to remind you that investing in any mutual fund carries certain risks. The principal risk factors for each fund are described at the end of this report. Carefully consider the investment objectives, charges and expenses of any fund before you invest. Contact us at 800.421.4184 or eagleasset.com or your financial advisor for a prospectus, which contains this and other important information about the Eagle Family of Funds. Our website also has timely information about the Funds, including performance and portfolio holdings.
We are grateful for your continued support and confidence in the Eagle Family of Funds.
Sincerely,
Richard J. Rossi
President
December 8, 2010
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| Performance Summary and Commentary |
| Eagle Capital Appreciation Fund | | |
Meet the managers | Steven M. Barry and David G. Shell, CFA are Chief Investment Officers and Senior Portfolio Managers at Goldman Sachs Asset Management L.P. and have been responsible for the day-to-day management of the Eagle Capital Appreciation Fund (the “Fund”) since 2002. Mr. Shell has been affiliated with the Fund since 1987 and has 23 years of investment experience; Mr. Barry joined the team in 1999 and has 24 years of investment experience.
Investment highlights | The Fund invests primarily in common stocks. The Fund’s portfolio management team believes that wealth is created through the long-term ownership of a growing business. They take a “bottom-up” approach to investing based on in-depth, fundamental research. A bottom-up method of analysis emphasizes the outlook at the company and industry level versus reliance on the general economy and/or market trends. The portfolio managers use an intensive research process and each company is analyzed as if they were going to own and operate that company indefinitely. Key characteristics of the companies in which the Fund currently seeks to invest may include: dominant market share, established brand name, pricing power, recurring revenue stream, free cash flow, high returns on invested capital, predictable growth, sustainable growth, long product life cycle, enduring competitive advantage, favorable demographic trends and excellent management.
This Morningstar Style Box™ shows the Fund’s investment style and size of companies held in the Fund.
© Copyright 2010 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information.
Performance summary | The Fund’s Class A shares returned 15.85% (excluding front-end sales charges) during the fiscal year ended October 31, 2010, underperforming its benchmark index, the Russell 1000® Growth Index, which returned 19.65%. The Russell 1000® Growth Index measures
performance of those Russell 1000® companies with higher price-to-book ratios and higher forecasted growth values and is representative of U.S. securities exhibiting growth characteristics. Please keep in mind that an index is not available for direct investment; therefore its performance does not reflect the expenses associated with the active management of an actual portfolio.
Growth of a $10,000 investment from 11/1/00 to 10/31/10 (a)
(a) The Fund’s values and returns reflect the maximum front-end sales charge of 4.75%, fund expenses and the reinvestment of dividends; however, they do not reflect the deduction of taxes that you would pay on fund distributions or redemption of fund shares. The value of an investment in other share classes will differ due to each class’s respective sales charges and expenses.
Performance data represented is historical and does not guarantee future results. The investment return and principal value of an investment will fluctuate, and you may have a gain or loss when you sell shares. Current performance may be higher or lower than the performance data quoted. To obtain more current performance data as of the most recent month-end, please visit our website at eagleasset.com.
Performance discussion | The Fund delivered strong absolute performance during the fiscal year ended October 31, 2010. The Fund’s top performing sectors were telecommunication services and information technology. While all market sectors delivered positive returns, the energy and health care sectors lagged.
The Fund trailed its benchmark, the Russell 1000® Growth Index, during the period due to relative underperformance in the consumer discretionary, health care and industrials sectors. In the strong performing consumer discretionary sector, the Fund was hurt by its underweight position and underperformance of its holdings. An overweight position coupled with stock selection in the underperforming health
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| Performance Summary and Commentary |
| Eagle Capital Appreciation Fund (cont’d) |
care sector detracted. The Fund had no holdings in the strong performing industrials sector. On the positive side, the Fund benefited from its overweight allocation to the top performing telecommunication services sector, combined with strong stock selection. Positive stock selection in the information technology sector also contributed to performance.
Under performers | Pharmaceutical manufacturer Baxter International, Inc. detracted from performance. Early in the year, the company trimmed its earnings forecast for 2010 due to a weaker outlook for its bioscience (blood plasma) business. Competition in the blood plasma market has increased, making it more difficult for Baxter International to price its products at a premium. While we expect uncertainty in the plasma business to remain an overhang in the near-term, we continue to believe the company trades at an attractive valuation due to its robust product pipeline and its market leading franchise. The Fund continues to hold the security.
Shares of Staples, Inc., an office supply retailer, traded down during the reporting period. The company remains focused on cost cutting, gaining market share from competitors, and expanding its geographic footprint in less saturated markets. Staples continues to make investments in new business processes that should strengthen its brand and position it for growth over the long-term. We believe Staples should also benefit from pent up demand given the drawdown of inventory by its corporate clients. We continue to hold the stock in the Fund as we expect that normalization in inventory levels should generate demand growth for the company.
CME Group, Inc., the world’s largest futures and options exchange, detracted from performance given lingering concerns over the rulemaking process following financial reform legislation. In addition, the company’s trading volumes, particularly those used to hedge changes in interest rates, remain under pressure due to market expectations that low rates will persist. We continue to believe CME Group will be a long-term beneficiary of the migration from over-the-counter (OTC) derivatives markets to exchanges. Furthermore, we believe the company’s OTC clearing house business is a significant growth opportunity, as it meets its customers’ demands for more transparency and less counterparty risk. The Fund continues to hold the stock.
Data center services company, Equinix, Inc. declined after pre-announcing a third quarter and full year 2010 revenue shortfall that was greater than market expectations. We believe the poor results were primarily driven by pricing concessions the company is making to retain key customers. The price
concessions appear to be the result of increasing competition at the basic service level and pricing pressure from key clients. The company’s key clients are dominant players in the social media, mobile computing, and telecom industries, and have a critical “hub” role in the data center. We trimmed the Fund’s position before the stock hit its lows due to greater uncertainty in how pricing related to these customers will develop in future years. Despite these headwinds, we believe the company should show strong organic revenue growth this year and can sustain it into future years.
Charles Schwab Corp. detracted from performance as persistently low short-term interest rates continue to force the financial services firm to waive fees on its money market funds. With uncertainty in global markets, rates are expected to remain low through 2011, forcing these waivers to continue. Furthermore, Bank of America/Merrill Lynch re-launched a competing online brokerage offering, which weighed on sentiment. The Fund still owns the stock, as we believe the company continues to execute on its business model and remains attractively valued and should benefit once interest rates move higher.
Top performers | CB Richard Ellis, Inc., the world’s leading commercial real estate services firm, contributed to performance over the past twelve months after reporting earnings that exceeded expectations. The results were driven by strong revenues in property sales and leasing, as well as cost reductions during the recent downturn which resulted in significant operating leverage. We continue to have conviction in the company given the strength of its franchise, its service-oriented business model, and its strong management team.
Wireless tower companies American Tower Corp. and Crown Castle International Corp. contributed to performance as both companies reported strong revenue and earnings growth. We believe the tower companies are well-positioned in a growing industry with high barriers to entry. Specifically, as the wireless communication industry continues to evolve from primarily voice to more data usage, the demands on the networks increase. In our view, this will lead to a greater need for more antennae to be placed on the towers, thereby increasing leasing revenues. Furthermore, we believe that the contracts used in the companies’ business models are attractive, as they provide a very predictable stream of revenue and recurring cash flow.
Broadcom Corp., a global leader in semiconductors for wired and wireless communications, contributed to performance during the period. Shares of Broadcom outperformed the market as the company reported first quarter earnings that
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| Performance Summary and Commentary |
| Eagle Capital Appreciation Fund (cont’d) |
beat consensus estimates and provided a better-than-expected second quarter outlook. The results were driven by strength in the company’s mobile/wireless and enterprise networking business segments. In our view, Broadcom has significant growth opportunities in the wireless connectivity markets, as it currently ships to five of the six largest cellular handset manufacturers. Specifically, the company recently signed agreements with Samsung and Nokia, which are providing a tailwind to unit sales growth.
Oracle Corp. contributed to performance after the company reported growth in earnings and revenue. The company’s software license revenues and product support revenues were above expectations as demand improved. In addition, we believe that the acquisition of Sun Microsystems should complement Oracle’s product portfolio and strengthen its long-term industry position.
The Fund continues to hold each of the securities noted above as “top performers.”
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| Performance Summary and Commentary |
| Eagle Growth & Income Fund | | |
Meet the managers | William V. Fries, CFA, Managing Director, and Cliff Remily, CFA, of Thornburg Investment Management, Inc. are Co-Portfolio Managers of the Eagle Growth & Income Fund (the “Fund”). Mr. Fries has more than 39 years of investment experience and has been Co-Portfolio Manager since 2001. Mr. Remily was named Co-Portfolio Manager in January 2009 and has over 10 years of industry experience.
Investment highlights | The Fund invests primarily in domestic equity securities (primarily common stocks) and can invest up to 30% of its net assets in foreign securities including up to 10% of its net assets in emerging markets securities. The Fund can also invest in fixed income securities. The Fund’s portfolio managers look for promising investments that can be purchased at a discount to their estimate of each investment’s intrinsic value. They seek investments that deliver a competitive total return over multiple time horizons. Holdings are classified in three categories: basic value, consistent earners and emerging franchises as a means of structuring diversification. Dividends and dividend growth are a consideration in stock selection and may include stocks outside the traditional dividend paying areas.
This Morningstar Style Box™ shows the Fund’s investment style and size of companies held in the Fund.
Performance summary | The Fund’s Class A shares returned 12.65% (excluding front-end sales charges) during the fiscal year ended October 31, 2010, underperforming its benchmark index, the Standard & Poor’s 500 Composite Stock Index (“S&P 500 Index”) which returned 16.52%. The S&P 500 Index is an unmanaged index of 500 U.S. stocks and gives a broad look at how stock prices have performed. Please keep in mind that an index is not available for direct investment; therefore its performance does not reflect the expenses associated with the active management of an actual portfolio.
Growth of a $10,000 investment from 11/1/00 to 10/31/10 (a)
(a) The Fund’s values and returns reflect the maximum front-end sales charge of 4.75%, fund expenses and the reinvestment of dividends; however, they do not reflect the deduction of taxes that you would pay on fund distributions or redemption of fund shares. The value of an investment in other share classes will differ due to each class’s respective sales charges and expenses.
Performance data represented is historical and does not guarantee future results. The investment return and principal value of an investment will fluctuate, and you may have a gain or loss when you sell shares. Current performance may be higher or lower than the performance data quoted. To obtain more current performance data as of the most recent month-end, please visit our website at eagleasset.com.
Performance summary | The Fund participated in the market’s rally over the past year with positive absolute returns in every sector. For the fiscal year ended October 31, 2010, the Fund’s average return from its investments in the consumer discretionary sector was greater than 33%, followed by industrials (up over 26%) and finally consumer staples, information technology, telecommunication services and energy (up over 10% each). The Fund’s international exposure also had a positive impact and contributed approximately 5% to absolute performance.
The Fund’s underperformance relative to the benchmark, the S&P 500 Index, was due to both allocation factors and stock selection. For example, the Fund held an overweight position in the telecommunication services sector, which helped relative performance but did not offset the negative stock selection in the sector. The Fund was also underweight in the consumer discretionary sector, which was the top performing sector in the benchmark, and overweight in financials, which was the poorest performing sector.
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| Performance Summary and Commentary |
| Eagle Growth & Income Fund (cont’d) |
Stocks in the consumer staples sector were the highlight over the past year, contributing the most on both an absolute and relative basis; however, this was counteracted by an underweight in the strong performing industrials sector. Although the Fund’s limited fixed income holdings were a positive contributor on an absolute basis, the exposure to fixed income hurt performance on a relative basis.
Under performers | Bank of America Corporation has been under pressure over concerns regarding the uncertainty of whether the bank would be required to put defaulted mortgages back on their balance sheet and potential legal liability associated with originating mortgage backed collateralized debt obligations without fully disclosing quality issues to buyers. In addition, fee revenue has declined given new U.S. banking regulations. The Fund’s long-term investment thesis for this holding is still intact and the Fund continues to hold the position.
Insurer AXA SA underperformed over concerns regarding the company’s ability to grow their variable annuity life business given the financial hardship the greater European Union faced over the past year. Due to these facts the Fund sold its position in the company.
Oil exploration company Diamond Offshore Drilling, Inc. reduced its dividend in the first quarter of calendar year 2010 due to a weakened backlog and expectations for rising costs related to maintaining its older fleet of offshore drilling rigs. On that news, the stock was sold from the Fund and the proceeds were invested in a competitor.
JPMorgan Chase & Co. provided flat overall returns despite building a stronger competitive position within its business segments. Further, the company has continued to increase its capital well above required minimums. This should enhance its ability to make strategic acquisitions, increase its dividend, or buyback shares. Despite the company’s strong fundamentals the overall uncertainty regarding banks and potential regulations has weighed heavily on the stock performance. The Fund still holds the stock.
Pharmaceutical manufacturer Teva Pharmaceutical Industries Ltd., along with most health care companies, underperformed the market as investors grew weary of the likelihood of the U.S. health care overhaul and outsized government deficits. Teva was also exposed to Israel’s re-classification into the developed markets index. The Fund continues to hold the stock.
Top performers | Baidu Inc., the leading internet search provider in China, gained market share rapidly and today remains the leading search provider in China. In addition, the company benefited from an announcement that Google was exiting the Chinese market in 2010. The Fund sold its position in the company at a price target.
Cable services provider Comcast Corporation benefited from new subscriber additions and improved margins as average revenue per subscriber increased (current customers adding additional services). The company also has a strong share buyback program while maintaining an attractive dividend yield. The Fund continues to hold the stock.
McDonald’s Corp. continued to benefit from the recessionary conditions as customers looked for value meals. Investors also became more interested in McDonald’s consistent earner characteristics and the company’s near 3% yield. The Fund still owns the stock.
Tobacco producer Philip Morris International, Inc. benefited from continued growth in volumes as well as a weak U.S. dollar. The company continues to utilize its strong cash generation to pay dividends and repurchase stocks. The dividend yield, which exceeded 4%, attracted investors, especially when compared to the low interest rates on fixed income instruments. The position is still held in the Fund.
Oil exploration company Seadrill Ltd. has a high quality offshore oil drilling fleet (average age of equipment is approximately four years), a progressive dividend policy, and significant cash on the balance sheet which we believe all bode well for the company. They also have very limited exposure to the impact of the Gulf of Mexico oil spill which helped support their performance. The Fund continues to own the stock.
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| Performance Summary and Commentary |
| Eagle International Equity Fund |
Meet the managers | Richard C. Pell is Chief Executive Officer at Artio Global Investors Inc. and Chief Investment Officer at its affiliate, Artio Global Management LLC (“Artio Global”). Rudolph-Riad Younes, CFA, is Head of International Equities at Artio Global. Messrs. Pell and Younes have managed the Eagle International Equity Fund (the “Fund”) since 2002.
Investment highlights | The Fund invests primarily in foreign equity securities. The Fund’s portfolio managers seek investment opportunities within the developed and emerging markets. In the developed markets, a “bottom-up” approach is adopted. A bottom-up method of analysis emphasizes the outlook at the company and industry level versus reliance on the general economy and/or market trends. In the emerging markets, a “top-down” assessment consisting of currency/ interest rate risks, political environments/leadership assessment, growth rates, structural reforms and risk (liquidity) is applied. A top-down method of analysis emphasizes the significance of economy and market cycles. In Japan, given the highly segmented nature of this market comprised of both strong global competitors and protected domestic industries, a hybrid approach encompassing both bottom-up and top-down analyses is conducted.
This Morningstar Style Box™ shows the Fund’s investment style and size of companies held in the Fund.
Performance summary | The Fund’s Class A shares returned 10.14% (excluding front-end sales charges) during the fiscal year ended October 31, 2010, underperforming its benchmark index, which returned 12.62%. The Fund’s benchmark index, the Morgan Stanley Capital International® All Country World Index ex-US (“MSCI® ACWI ex-US”), is a free float-adjusted market capitalization index that is designed to measure equity market performance in the global developed and emerging markets. Please keep in mind that an index is not available for direct investment; therefore its performance does not reflect the expenses associated with the active management of an actual portfolio.
Growth of a $10,000 investment from 11/1/00 to 10/31/10 (a)
(a) The Fund’s values and returns reflect the maximum front-end sales charge of 4.75%, fund expenses and the reinvestment of dividends; however, they do not reflect the deduction of taxes that you would pay on fund distributions or redemption of fund shares. The value of an investment in other share classes will differ due to each class’s respective sales charges and expenses.
Performance data represented is historical and does not guarantee future results. The investment return and principal value of an investment will fluctuate, and you may have a gain or loss when you sell shares. Current performance may be higher or lower than the performance data quoted. To obtain more current performance data as of the most recent month-end, please visit our website at eagleasset.com.
Performance discussion | Concerns surrounding the European sovereign debt crisis and pending eurozone bank stress tests impacted international markets during most of the first half of the reporting period. Declines in European bourses were further exacerbated by a decline in the euro over this same period as investors began to question the long term viability of the common currency. However, after positive bank stress tests results were announced in July, international equities began to rebound as did the euro, and rallies within equities generally were further supported amid prospects for the U.S. Federal Reserve’s second round of quantitative easing.
For the fiscal year ended October 31, 2010, the Fund realized its largest absolute returns in the consumer staples, materials, industrials, information technology and consumer discretionary sectors, whereas the financials, energy and utilities sectors underperformed. From an absolute performance perspective, emerging markets outperformed their developed market counterparts.
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| Performance Summary and Commentary |
| Eagle International Equity Fund (cont’d) |
For the review period, the Fund underperformed its benchmark index, the MSCI ACWI (ex-US). Stock selection within developed markets detracted as did country and stock selection within emerging markets; however the Fund’s underweight to Japan contributed to relative results, as did the allocation decision between emerging and developed markets.
Within developed markets, the Fund’s positioning in the financials, consumer staples and telecommunications sectors detracted from the Fund’s investment performance. Within emerging markets, stock selection in China detracted from relative performance whereas stock selection in Russia, Taiwan and India had a positive impact.
The Fund participated in the IPO of Pandora (Denmark), a manufacturer and designer of jewelry as well as in Amadeus IT (Spain), involved in software for the global travel and tourism industry, both of which outperformed. The Fund continues to hold both companies. The Fund also benefitted from currency hedging out of the euro into the U.S. dollar amid weakness for the euro. As of the end of the period, the Fund no longer held these hedge positions.
Under performers | The Fund’s position held in iShares Euro Stoxx 50 Index Fund underperformed, notably during the sovereign debt crisis, the effect of which was magnified due to a declining euro relative to the U.S. dollar. The Fund occasionally invests in this index fund as a way to quickly adjust its overall exposure to a region or specific market. As of the end of the period, the position was no longer held.
Shares held in UniCredit S.p.A. (Italy), OTP Bank Nyrt. (Hungary) and BNP Paribas (France) underperformed. The sovereign debt crisis, centered on Portugal, Ireland, Italy, Greece and Spain, led many banks within the eurozone as well as in Central and Eastern Europe to underperform during the period. As investors tried to assess the level of sovereign debt held by European banks, several credit rating agency downgrades added to these concerns and placed added pressure on the value of the euro versus the U.S. dollar during the first seven months of the reporting period. We remain cautious on the outlook for eurozone banks and remain underweight. We expect these banks to raise new capital, which will likely be dilutive to existing investors but should result in more sound systemic fundamentals. The Fund sold its positions in UniCredit and OTP Bank but maintained its investment in BNP Paribas as we believe they have more limited exposure to sovereign debt and find their business mix to be attractive. Specifically, we are seeing some loan growth
in their home market, a solid investment banking business, adequate capital levels and an attractive valuation.
Shares of drug maker Roche Holding AG (Switzerland), which the Fund no longer holds, underperformed during the period due to two major events. A Phase III trial for a new diabetes drug was halted amid the observation of negative side effects. The company had expectations this drug would become the next blockbuster in their arsenal. Additionally, approval for a breast cancer drug is now in question over concerns regarding its risks and benefits.
Top performers | Cellular phone manufacturer HTC Corp (Taiwan) was the first vendor to deliver a handset running the Android operating system, and has delivered a wide array of handsets to operators all over the world. They currently command a large share of the Android smartphone global market, leading to earnings visibility and strength in their share price. The Fund continues to own the security.
Amid strength in the metals and mining sector, shares of Rio Tinto PLC (UK) outperformed as did the Market Vectors ETF Gold Miners (U.S.). The sector has been well supported as demand for commodities such as copper and silver (used in the manufacture of items such as cable, wire and electrical products) remains strong. The price of gold has also enjoyed price gains in part due to economic uncertainty and burgeoning budget deficits within the developed world. The Fund still owns both of these securities.
Shares of Fraport AG NPV (Germany), the operator of the Frankfurt Airport, outperformed. The company views itself not only as a central traffic junction for aircraft, cars and trains, but also an “Airport City”—a first class address for mobility, shopping, events and real estate. Improving passenger traffic has contributed to outperformance. We view Fraport as a quasi-monopoly and it has been a long-term holding of the Fund’s and remains in the Fund.
iShares MSCI India Index Fund (India) outperformed given continued positive growth prospects for the country going forward. India forms an important component of our emerging market exposure within the Fund. The use of the Index fund has provided us with an expeditious way of adjusting the Fund’s exposure to India. The Fund continues to hold this position.
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| Performance Summary and Commentary |
| Eagle Investment Grade Bond Fund |
Meet the managers | James C. Camp, CFA, a Managing Director at Eagle Asset Management (“Eagle”), and Joseph Jackson, CFA, have managed the Eagle Investment Grade Bond Fund (the “Fund”) since inception in March 2010 and are jointly responsible for the day-to-day management of the Fund’s investment portfolio. Mr. Camp and Mr. Jackson have 21 and 11 years of investment experience respectively.
Investment highlights | The Fund invests primarily in investment grade fixed income securities. Investment grade is defined as securities rated [BBB-] or better by Standard & Poor’s Rating Services or an equivalent rating by at least one other nationally recognized statistical rating organization or, for unrated securities, those that are determined to be of equivalent quality by the Fund’s Portfolio Managers. The average portfolio duration of the Fund is expected to vary and may generally range from two to seven years based upon economic and market conditions. The Fund expects to invest in a variety of fixed income securities including, but not limited to, corporate debt securities of U.S. and non-U.S. issuers, including corporate commercial paper; bank certificates of deposit; debt securities issued by states or local governments and their agencies; obligations of non-U.S. Governments and their subdivisions, agencies and government sponsored enterprises; obligations of international agencies or supranational entities (such as the European Union); obligations issued or guaranteed by the U.S. Government and its agencies; mortgage-backed securities and asset-backed securities; commercial real estate securities; and floating rate instruments.
This Morningstar Style Box TM shows the Fund’s investment style and size of companies held in the Fund.
Performance summary | The Fund’s Class A shares returned 5.78% (excluding front-end sales charges) from its inception on March 1, 2010 through October 31, 2010, underperforming its benchmark index, which returned 6.01%. The Fund’s benchmark index, the Barclays Intermediate Government/Credit Bond Index, includes U.S. government and investment grade
credit securities that have a greater than or equal to one year and less than ten years remaining to maturity and have $250 million or more of outstanding face value. Please keep in mind that an index is not available for direct investment; therefore its performance does not reflect the expenses associated with the active management of an actual portfolio.
Growth of a $10,000 investment from 3/1/10 to 10/31/10 (a)
(a) The Fund’s values and returns reflect the maximum front-end sales charge of 3.75%, fund expenses and the reinvestment of dividends; however, they do not reflect the deduction of taxes that you would pay on fund distributions or redemption of fund shares. The value of an investment in other share classes will differ due to each class’s respective sales charges and expenses.
Performance data represented is historical and does not guarantee future results. The investment return and principal value of an investment will fluctuate, and you may have a gain or loss when you sell shares. Current performance may be higher or lower than the performance data quoted. To obtain more current performance data as of the most recent month-end, please visit our website at eagleasset.com.
Performance discussion | The Fund commenced operations on March 1, 2010. During the reporting period ended October 31, 2010, there were three key trends in the bond market as a whole. First, the long end of the yield curve performed extremely well after being one of the worst investments of 2009. This yield curve flattening trend affected all sectors of the market. Next, bonds issued by companies in the financials sector generated excess returns despite the ongoing stress in the U.S. mortgage market, European debt crisis and SEC investigations. Finally, high risk bonds outperformed those of high quality. BBB-rated bonds outperformed bonds of higher quality ratings by more than 1.30% during the period.
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| Performance Summary and Commentary |
| Eagle Investment Grade Bond Fund (cont’d) |
During the reporting period from inception through October 31, 2010, the Fund’s absolute performance was led by an extended rally in U.S. Treasuries. The Fund underperformed its benchmark index. In credit, the Fund’s overweight position in high quality industrial corporate bonds proved to be the largest contributor to the Fund’s relative performance. Conversely, an underweight to the financials sector was the largest detractor. U.S. Treasuries rallied and our underweight position hurt relative returns. This was offset by the Fund holding securities with an average duration in the sector that was significantly longer than the benchmark in a year where the long end of the yield curve outperformed the short end. In the Government-related space, the Fund’s overweight position in FDIC insured bonds hurt the Fund’s investment performance. Fortunately, the Fund’s overweight allocations to Canadian Local Authorities and Supranational Banks earned positive excess returns.
Under performers | Two FDIC insured issues, GE Capital Corp (FDIC-insured) 3% 12/2011 and JPM (FDIC-insured) 3.125% 12/2011, offered little incremental yields over U.S. Treasuries during the low-rate environment of the reporting period. We still hold these bonds in the Fund.
Treasury issues of shorter duration, including the Fund’s holding in U.S. Treasury 1.375% 2/2013, lagged those with longer durations for a majority of the year. The Fund has since sold the bond.
The short duration of the Verizon Communication 7.375% 9/2012 bond issued by the telecommunications firm
underperformed along with other shorter term bonds. We sold this bond, maturing in 2012, from the Fund and purchased a longer duration Verizon issue maturing in 2019.
The combination of delinquent mortgage buybacks and the very short average life of the Fannie Mae REMIC Trust 2007-B2AB 5.5% 12/2020 agency mortgage-backed security issue was a hindrance to the Fund’s investment performance. This bond was sold from the Fund.
Top performers | The U.S. Treasury 4.75% 8/2017 bond was the Fund’s largest-weight holding and significantly outperformed the average treasury bond in the benchmark due to its long duration. The Fund continues to own this bond.
Supranational banks and Canadian provincial bonds, Inter-American Development Bank (supranational) 2.5% and 7/2015 and Province of Ontario 2.7% 6/2015, provided strong returns in 2010 as investors diversified away from traditional Agency-sector giants Fannie Mae and Freddie Mac. The Fund still owns these bonds.
The Union Pacific 5.7% 8/2018 railroad bond performed well as businesses focused on economical means of freight transportation. This bond is still held in the Fund.
The Newmont Mining Corp 5.125% 10/2019 gold mining company bond benefited from the significant appreciation in the price of gold over the reporting period. The Fund still owns this bond.
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| Performance Summary and Commentary |
| Eagle Large Cap Core Fund | | |
Meet the managers | Richard Skeppstrom, John “Jay” Jordan, CFA, Craig Dauer, CFA, and Robert Marshall at Eagle Asset Management, Inc. (“Eagle”) have been Co-Portfolio Managers of the Eagle Large Cap Core Fund (the “Fund”) since inception. Mr. Skeppstrom is a Managing Director at Eagle and has 19 years of investment experience. Mr. Jordan, Mr. Dauer and Mr. Marshall have 19, 16 and 23 years of investment experience, respectively.
Investment highlights | The Fund invests primarily in common stocks. When identifying investments for the Fund, the portfolio managers use a “bottom-up” research process that is combined with a proprietary relative-valuation discipline. A bottom-up method of analysis emphasizes the outlook at the company and industry level versus reliance on the general economy and/or market trends. In general, the portfolio managers seek to select securities that, at the time of purchase, have above-average expected returns and at least one of the following characteristics: projected earnings growth rate at or above the benchmark index, above-average earnings quality and stability, or a price-to-earnings ratio comparable to the benchmark index.
This Morningstar Style Box™ shows the Fund’s investment style and size of companies held in the Fund.
Performance summary | The Fund’s Class A shares returned 9.48% (excluding front-end sales charges) during the fiscal year ended October 31, 2010, underperforming its benchmark index, the Standard & Poor’s 500 Composite Stock Index (“S&P 500 Index”) which returned 16.52%. The S&P 500 Index is an unmanaged index of 500 U.S. stocks and gives a broad look at how stock prices have performed. Please keep in mind that an index is not available for direct investment; therefore its performance does not reflect the expenses associated with the active management of an actual portfolio.
Growth of a $10,000 investment from 5/2/05 to 10/31/10 (a)
(a) The Fund’s values and returns reflect the maximum front-end sales charge of 4.75%, fund expenses and the reinvestment of dividends; however, they do not reflect the deduction of taxes that you would pay on fund distributions or redemption of fund shares. The value of an investment in other share classes will differ due to each class’s respective sales charges and expenses.
Performance data represented is historical and does not guarantee future results. The investment return and principal value of an investment will fluctuate, and you may have a gain or loss when you sell shares. Current performance may be higher or lower than the performance data quoted. To obtain more current performance data as of the most recent month-end, please visit our website at eagleasset.com.
Performance discussion | The Fund’s gains were led by strong contributions from the information technology, consumer discretionary and industrials sectors. In information technology, the largest contributions were from the Fund’s holdings in the computers & peripherals and software industries. In consumer discretionary, the media and multiline retail industries performed best. In industrials, the Fund benefited from its aerospace & defense holdings. Negative return contributions occurred in the consumer staples and financial sectors, with the greatest underperformance coming from holdings in the food & staples retailing and diversified financial services industries, respectively.
The Fund underperformed its benchmark during the period primarily due to underperformance relative to the benchmark in the information technology, consumer staples and financials sectors. In information technology, the Fund’s holdings in the software and semiconductors industries underperformed. Holdings in the food & staples retailing industry led to relative underperformance in the consumer staples sector. Finally, in
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| Performance Summary and Commentary |
| Eagle Large Cap Core Fund (cont’d) |
financials, the diversified financial services, commercial bank and real estate investment trust industries detracted from performance. On the other hand, the Fund benefited from stock selection in market-weighted energy and stock selection in underweighted telecommunication services.
Under performers | CVS Caremark Corporation was sold in November 2009 following its third quarter earnings announcement when management revealed additional large contract losses in the PBM (pharmacy benefit management—the acquired Caremark business) segment, and meaningfully reduced 2010 guidance for PBM operating earnings.
Bank of America Corporation sold off on cautious guidance following its second quarter earnings release along with concerns about the New York Fed and the Federal Housing Finance Administration’s plans to possibly get more aggressive on putting back bad loans in securitizations to originating banks. The Fund no longer holds this stock.
BP PLC was sold in May 2010. Liability concerns associated with the Deepwater Horizon oil spill in the Gulf of Mexico negatively impacted stock performance during the reporting period, offsetting improving fundamentals within the exploration & production (“E&P”) business. Our ability to develop any conviction around potential future liabilities was severely handicapped.
Video game manufacturer Electronic Arts, Inc. was sold in June 2010. While management made significant progress in improving game quality and production efficiency, the company’s recent video game releases have been viewed by the market as “average”. Given today’s lackluster consumer spending environment, we believed the Fund’s capital would be better off deployed elsewhere.
Wells Fargo & Company fell along with other major banks on concerns that banking regulatory overhaul legislation could result in lower debt ratings for major banks (due to a lack of
assumed government support), along with more recent concerns about the New York Fed and the Federal Housing Finance Administration’s plans to possibly get more aggressive on putting back bad loans in securitizations to originating banks. The stock is held for its strong competitive position and valuation attractiveness.
Top performers | UnitedHealth Group, Inc., along with other managed health care stocks, reacted well to the health care bill that ultimately passed Congress. We believe this legislation will be negative for insurers once fully implemented, but could have been much worse. With the final signing of the bill, the health care debate—and its attendant vilification of health insurers—should be moved to the back burner for a while. The Fund still holds the stock as we view it as an attractive holding.
After selling Apple, Inc. in mid-March at a significant gain, the company reported second quarter results that significantly exceeded our expectation for iPhone units, Mac units, iPod units and gross margin. The sharp market selloff on May 6th, 2010 gave us a chance to repurchase the stock at an attractive price and it remains in the Fund.
Macy’s, Inc. strong performance reflected better-than-expected same store sales, upbeat management guidance, and rising consensus estimates. We believed per store sales productivity was improving, driven by the company’s merchandise localization efforts (customizing product offerings by store), along with improving consumer spending trends. We sold the security from the Fund as it reached its target price.
ConocoPhillips benefited from improved price realizations in the E&P business, strong margins in the domestic refining business, and continued execution of asset sales/deleveraging program. The stock remains a holding in the Fund.
Autodesk, Inc. was a strong performer for the Fund that was sold to take profits late in the reporting period due to a lack of visibility on the company’s geographically diverse end markets.
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| Performance Summary and Commentary |
| Eagle Mid Cap Growth Fund |
Meet the managers | Bert L. Boksen, CFA, a Managing Director and Senior Vice President at Eagle Asset Management, Inc. (“Eagle”), is the Portfolio Manager of the Eagle Mid Cap Growth Fund (the “Fund”). Mr. Boksen has 33 years of investment experience. Eric Mintz, CFA, with 15 years of investment experience and Christopher Sassouni, DMD, with 21 years of investment experience and, have been Assistant Portfolio Managers since 2008 and 2006, respectively.
Investment highlights | The Fund invests primarily in stocks of mid-capitalization companies. The Fund’s portfolio managers seek to capture the significant long-term capital appreciation potential of mid-cap, rapidly growing companies. The portfolio managers use a “bottom-up” investment approach through a proprietary research strategy that emphasizes the selection of mid-cap growth stocks that are reasonably priced. A bottom-up method of analysis emphasizes the outlook at the company and industry level versus reliance on the general economy and/or market trends. The Fund’s portfolio managers believe that conducting extensive research on mid-cap companies may enable the Fund to capitalize on market inefficiencies and thus outperform the market.
This Morningstar Style Box™ shows the Fund’s investment style and size of companies held in the Fund.
Performance summary | The Fund’s Class A shares returned 31.91% (excluding front-end sales charges) during the fiscal year ended October 31, 2010, outperforming its benchmark index, which returned 28.03%. The Fund’s benchmark index, the Russell Midcap® Growth Index, measures the performance of those Russell Midcap® companies with higher price-to-book ratios and higher forecasted growth values. Please keep in mind that an index is not available for direct investment; therefore its performance does not reflect the expenses associated with the active management of an actual portfolio.
Growth of a $10,000 Investment from 11/1/00 to 10/31/10 (a)
(a) The Fund’s values and returns reflect the maximum front-end sales charge of 4.75%, fund expenses and the reinvestment of dividends; however, they do not reflect the deduction of taxes that you would pay on fund distributions or redemption of fund shares. The value of an investment in other share classes will differ due to each class’s respective sales charges and expenses.
Performance data represented is historical and does not guarantee future results. The investment return and principal value of an investment will fluctuate, and you may have a gain or loss when you sell shares. Current performance may be higher or lower than the performance data quoted. To obtain more current performance data as of the most recent month-end, please visit our website at eagleasset.com.
Performance discussion | The Fund had strong absolute performance during the one-year reporting period ended October 31, 2010. On an absolute basis, the materials, information technology, consumer staples, and telecommunication services sectors led the Fund’s strong returns. In materials, the chemicals and metals & mining industries posted strong gains. The communications equipment industry posted the highest gains in the information technology sector. The personal products industry rallied most strongly in the consumer staples sector. In telecommunication services, wireless telecommunication services had a strong gain. On an absolute basis, healthcare and financials were the lagging sectors. In healthcare, the healthcare equipment & supplies industry posted a negative return for the year. In financials, the commercial banks and capital markets industries posted modest gains.
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| Performance Summary and Commentary |
| Eagle Mid Cap Growth Fund (cont’d) |
The Fund outperformed its benchmark index during the reporting period. The materials, information technology, consumer staples and energy sectors each contributed to the strong relative returns. The Fund’s overweight position in materials amplified strong stock selection in this sector. The Fund outperformed in information technology due to strong stock selection in the semiconductors & semiconductor equipment, and communications equipment industries. The Fund benefited from an underweight position to consumer staples and very strong absolute performance. An overweight position and strong stock selection in the oil gas & consumable fuels industry led to outperformance in energy. The Fund underperformed relative to the benchmark in the health care sector during the reporting period as holdings in the healthcare equipment & supplies and healthcare providers & services industries underperformed.
Top performers | Chemical producer Huntsman Corporation, is a highly cyclical company that has appreciated as the economic outlook has improved. Further, the company has successfully implemented a cost reduction program. The Fund continues to hold the stock.
Rovi Corp, a provider of television guides for set-top boxes, has recently appreciated due to a new patent license agreement with Apple, in which Rovi will receive license fees for Apple’s use of Rovi’s patents in its AppleTV platform. We believe this bodes well for Rovi’s ability to receive license fees in the future from other companies with streaming on-line video technologies. The Fund continues to hold the stock.
Las Vegas Sands Corp., which owns and operates casino hotels, recently opened a resort in Singapore that has had significantly better than expected results. We continue to hold the stock in the Fund.
Kansas City Southern is a railroad that operates in the U.S., Mexico and adjacent to the Panama Canal. The stock appreciated on strong pricing and volume trends and the Fund continues to hold it.
Nutritional supplement provider NBTY was acquired during the reporting period by Carlyle Group for a 47 percent premium.
Under performers | Apollo Group Inc. is a post-secondary education provider. We sold the stock out of the Fund in the second quarter after the company announced a negative court ruling that is a likely overhang on the stock.
Business advisory services company FTI Consulting, Inc. pre-announced weaker than expected results and specifically cited weakness in bankruptcy, restructuring and M&A consulting activity levels. The Fund sold the stock.
Bally Technologies Inc. produces slot machines and casino operating systems. Sentiment has turned negative for the industry as investors question the thesis that a replacement cycle of machines will occur. We continue to hold the stock in the Fund as we believe the company’s financial health is improving, it is increasing market share and expanding internationally.
Health Management Associates, Inc. operates acute care hospitals in the United States. The stock declined on concerns about decreased utilization. The Fund sold the stock.
Lincare Holdings Inc. is the leading provider of home oxygen equipment and services. Competitive bidding for oxygen-related services came in lower than expected, resulting in cuts to Medicare reimbursement of 32 percent in some areas. We believe Lincare will be able to continue to increase its market share but we sold the stock from the Fund due to uncertainty about future earnings growth given this ongoing reimbursement cutting environment.
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| Performance Summary and Commentary |
| Eagle Mid Cap Stock Fund |
Meet the managers | Todd L. McCallister, Ph.D., CFA, is a Managing Director and Senior Vice President at Eagle Asset Management, Inc. (“Eagle”) and Co-Portfolio Manager of the Eagle Mid Cap Stock Fund (the “Fund”). Mr. McCallister has 23 years of investment experience and has managed the Fund since its inception. Stacey Serafini Thomas, CFA, is a Vice President at Eagle and served as Assistant Portfolio Manager to the Fund from 2000 to 2005, before being named Co-Portfolio Manager. Ms. Thomas has more than 13 years of investment experience.
Investment highlights | The Fund invests primarily in stocks of mid-capitalization companies. The portfolio managers of the Fund employ a “bottom-up” stock-selection process to identify growing, mid-cap companies that are reasonably priced. A bottom-up method of analysis emphasizes the outlook at the company and industry level versus reliance on the general economy and/or market trends. The portfolio managers seek to gain a comprehensive understanding of a company’s management, business plan, financials, real rate of growth and competitive threats and advantages.
This Morningstar Style Box™shows the Fund’s investment style and size of companies held in the Fund.
Performance summary | The Fund’s Class A shares returned 20.24% (excluding front-end sales charges) during the fiscal year ended October 31, 2010, underperforming its benchmark index, the Standard & Poor’s MidCap 400 Index (“S&P MidCap 400”) which returned 27.64%. The S&P MidCap 400, is an unmanaged index that measures the performance of the mid-sized company segment of the U.S. market. Please keep in mind that an index is not available for direct investment; therefore its performance does not reflect the expenses associated with the active management of an actual portfolio.
Growth of a $10,000 Investment from 11/1/00 to 10/31/10 (a)
(a) The Fund’s values and returns reflect the maximum front-end sales charge of 4.75%, fund expenses and the reinvestment of dividends; however, they do not reflect the deduction of taxes that you would pay on fund distributions or redemption of fund shares. The value of an investment in other share classes will differ due to each class’s respective sales charges and expenses.
Performance data represented is historical and does not guarantee future results. The investment return and principal value of an investment will fluctuate, and you may have a gain or loss when you sell shares. Current performance may be higher or lower than the performance data quoted. To obtain more current performance data as of the most recent month-end, please visit our website at eagleasset.com.
Performance discussion | The information technology and materials sectors were the Fund’s largest contributors to performance during the fiscal year ended October 31, 2010. In information technology, the Fund’s holdings in information technology services, semiconductors and electronic equipment instrument industries performed well. In materials, current concerns around the health of the U.S. dollar led investors to commodities related holdings. The Fund’s chemicals, packaging, and metals stocks benefited from this. Telecommunication services and financials were the largest underperforming sectors during the reporting period. The telecommunication services sector as a whole has been hit as providers have lowered fees across the board and the competitive environment has heated up. In financials, the Fund’s commercial bank investments underperformed.
Stocks that offer what we view as safety and stability have remained out of favor in the recent markets. We find this to be anomalous, especially given the current economic weakness
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| Performance Summary and Commentary |
| Eagle Mid Cap Stock Fund (cont’d) |
(as reflected by 2.5 percent 10-year Treasury rates) and the strong run that more volatile stocks experienced last year.
The Fund underperformed its benchmark index, the S&P Mid Cap 400, during the reporting period. Relative underperformance was concentrated in the financials and health care sectors. The Fund held an overweight position in the underperforming financial exchanges industry and an underweight position, coupled with underperformance, in real estate investment trusts, which worked to our disadvantage this year. Fundamentally, we still believe in the exchanges. Real estate investment trusts have continued to be overpriced in our opinion, leading to very few opportunities for us. Health care was weighed down by equipment companies underperforming and by not owning the generic pharmaceutical stocks that contributed to the benchmark. On a relative basis, the materials sector performed best. We maintained an overweight position, especially in the packaging and chemicals industries. The Fund’s holdings in materials offer large free cash flow yields, profitability and exposure to emerging markets.
Under performers | Specialty vehicle manufacturer Oshkosh Corporation has traded lower as investors have discounted post-Iraq U.S. military spending. We continue to believe investors are underestimating the sustainable level revenues from the Department of Defense. At current valuations and cash flows, we believe the market is assigning little, if any, value to its access equipment or fire and emergency-vehicle businesses. The Fund still owns the stock.
Beckman Coulter, Inc., a medical equipment manufacturer, preannounced that it would not meet its second-quarter earnings estimates and lowered its guidance. The company was hurt due to continued weakness from the recall of a diagnostic test kit and the management team has struggled with preventing that issue from hurting the overall business. As a result, the Fund sold the stock.
DISH Network Corp had problems this year as the company began to miss estimates on weak subscriber results. We sold the Fund’s position in the subscription television service provider as the quality of the subscribers became a question in the increasingly competitive market.
State Street Corporation missed earnings while the Fund held its shares. The company provides banking and financial processing services to institutions and has recognized lower
net interest revenue in this low interest rate environment. The Fund sold the shares as we expect short-term interest rates to remain low for the foreseeable future, creating a continued drag on earnings growth for the company.
Owning oil and gas exploration firm Petrohawk Energy Corporation hurt the Fund’s investment returns as the price of gas decreased during the Fund’s holding period. We sold the holding from the Fund as natural gas prices did not significantly recover.
Top Performers | Whiting Petroleum Corporation is an energy company that gives us exposure to Bakken Shale, the most potent domestic crude oil region. Its shares were up throughout the reporting period as the company continued to release good results regarding its wells and its price appreciated such that it no longer trades at a discount to its competitors. We continue to hold this company in the Fund.
Technology equipment manufacturer Marvell Technology Group, Ltd. has seen large growth in its wireless networking business. We continue to hold the stock in the Fund as we believe there is growth potential within some of the products that include new tablet computers.
IHS, Inc., a business software and service company, has been up this year after beating earnings and revenue estimates through a mixture of acquisitions and sales growth. The company also tightened its adjusted earnings forecast. The Fund continues to own the company’s shares due to its subscription based revenue and steady cash flow.
Dr. Pepper Snapple Group, Inc. was up after the beverages company reported it will enjoy a favorable renegotiation of its distribution agreements with Coca-Cola, Inc. following that company’s takeover of Coca-Cola Enterprises. This is on the heels of receiving $900 million from Pepsi for similar negotiations, of which more than $400 million was used to pay down debt. We sold the holding from the Fund after we felt that it was fully valued.
Industrial goods manufacturer Ametek Inc. had a strong year as it has seen organic growth, backlog growth, and a continuation in its free cash flow generation. Furthermore, the company has been steadily acquiring smaller companies while still keeping its balance sheet solid. We continue to hold this position in the Fund.
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| Performance Summary and Commentary |
| Eagle Small Cap Core Value Fund |
Meet the managers | David M. Adams, CFA, Lead Portfolio Manager, and John “Jack” McPherson, CFA, Co-Portfolio Manager, are Managing Directors at Eagle Boston Investment Management, Inc. (“EBIM”) and have been responsible for the day-to-day management of the Eagle Small Cap Core Value Fund (the “Fund”) since its inception. Both Mr. Adams and Mr. McPherson have 20 years of investment experience.
Investment highlights | The Fund invests primarily in equity securities of small-capitalization companies. Using a value approach to investing, the Fund’s portfolio managers seek to capture capital growth by selecting securities that the portfolio managers believe are selling at a discount relative to their underlying value and then hold them until their market value reflects their intrinsic value. To assess value, a “bottom-up” method of analysis is utilized. A bottom-up method of analysis emphasizes the outlook at the company and industry level versus reliance on the general economy and/or market trends. Other factors that the portfolio managers may look for when selecting investments include: management with demonstrated ability and commitment to the company, above-average potential for earnings and revenue growth, low debt levels relative to total capitalization and strong industry fundamentals.
This Morningstar Style Box TM shows the Fund’s investment style and size of companies held in the Fund.
Performance summary | The Fund’s Class A shares returned 22.63% (excluding front-end sales charges) during the fiscal year ended October 31, 2010, underperforming its benchmark index, which returned 26.58%. The Fund’s benchmark index, the Russell 2000 ® Index, is an unmanaged index comprised of the 2,000 smallest companies in the Russell 3000 ® Index. The Russell 3000® Index measures the performance of the 3,000 largest U.S. companies based on total market capitalization. Please keep in mind that an index is not available for direct investment; therefore its performance does not reflect the expenses associated with the active management of an actual portfolio.
Growth of a $10,000 Investment from 11/1/00 to 10/31/10 (a)
(a) The Fund’s values and returns reflect the maximum front-end sales charge of 4.75%, fund expenses and the reinvestment of dividends; however, they do not reflect the deduction of taxes that you would pay on fund distributions or redemption of fund shares. The value of an investment in other share classes will differ due to each class’s respective sales charges and expenses.
Performance data represented is historical and does not guarantee future results. The investment return and principal value of an investment will fluctuate, and you may have a gain or loss when you sell shares. Current performance may be higher or lower than the performance data quoted. To obtain more current performance data as of the most recent month-end, please visit our website at eagleasset.com.
Performance discussion | For the fiscal year ended October 31, 2010, the Fund benefited from strong absolute performance in the consumer staples, materials, telecommunication services, and information technology and consumer discretionary sectors. While the industrial, utility and financial sectors all generated positive returns for the period, they lagged the overall return for the Fund.
The performance of the Fund trailed its benchmark index during the reporting period. Relative to the benchmark, the Fund outperformed in the consumer staples, health care and materials sectors. In consumer staples, the Fund benefited from strong stock selection. In health care and materials, the Fund was underweight to the index, but strong stock selection led to outperformance. Sectors detracting from relative performance were industrials, information technology and consumer discretionary. In the industrial and consumer discretionary sectors, the Fund was underweight and underperformed. With respect to information technology holdings, an overweight position combined with underperformance from a stock selection led to relative lag to the benchmark.
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| Performance Summary and Commentary |
| Eagle Small Cap Core Value Fund (cont’d) |
A key factor contributing to the Fund’s relative underperformance was the Fund’s below average exposure to higher beta areas of the market versus the Russell 2000® Index. A higher beta stock is one that has a higher degree of volatility, and thus risk, than the average stock in a market. During the reporting period, the highest beta stocks were the strongest performers, reflecting a higher tolerance for risk among investors.
The Fund’s fundamental focus on higher quality companies with below average debt combined with our value oriented investing approach generally results in below average exposure to the riskier market segments. We believe that higher quality stocks tend to outperform higher beta stocks over longer periods of time and we remain committed to focusing on the higher quality segment of the market.
Under performers | LECG Corp., a provider of consulting services to large corporations, fell 75%. While demand for the company’s services remains weak, there has been no new news released that would justify the drop. The drop appears to be a function of the stock’s limited trading liquidity combined with a motivated seller. We remain holders of the stock but continue to evaluate the situation.
1-800-FLOWERS.COM, Inc. is a gift retailer that is experiencing a difficult consumer environment for their various products given the overall state of the U.S. economy, which caused its shares to drop 53%. We believe the long-term potential for the business remains attractive and continue to hold the stock in the Fund.
Oil and gas exploration firm Comstock Resources, Inc. declined 46% as weak natural gas prices offset continued strong developments within their major production areas. The Fund continues to hold the position as we believe the company has attractive drilling sites in some of the more important natural gas producing regions of the country.
Net 1 U.E.P.S. Technologies Inc., a provider of transaction processing services to governmental agencies serving poor and unbanked populations globally, dropped 30% despite issuing a decent earnings report for the period. The market reacted negatively as the company continues to await clarity regarding the contract renewal of their largest client. We view the
uncertainty as being discounted in the share price and therefore continue to hold the position in the Fund.
SWS Group Inc., an investment banking and brokerage firm, fell 39%. Weak trading volumes in their brokerage business, a low interest rate environment and write-offs of their loan portfolio, combined with resignation of the company’s CEO, helped drive down the stock. While disappointed with the CEO’s resignation, we don’t view it as negatively impacting the original investment thesis. We continue to believe the company is positioned to benefit from a rebound in market trading activity and an eventual increase in short-term interest rates. The Fund still owns the stock.
Top performers | Herbalife Ltd., a multi-level marketer of nutritional supplements rose 90% as the company reported strong quarterly earnings growth and reiterated a strong future outlook based largely on the continued success of the rollout of their daily consumption model. We continue to hold the position in the Fund.
AMERIGROUP Corp., a provider of Medicaid managed care services to state government agencies, rose 89%. The strength of the stock appears to be a function of the strong underlying fundamentals of the business, namely increasing Medicaid enrollments nationally. We continue to hold the position in the Fund.
Sonic Solutions, a technology firm saw its shares increase dramatically (146%) during the reporting period as the company announced several new partners for its CinemaNow product, along with their strategic acquisition of DivX, which we believe continues to validate the long-term earnings potential of the company. We continue to hold the position in the Fund.
Sybase Inc., an industry leader in delivering enterprise and mobile software to manage, analyze and mobilize information was acquired by SAP and appreciated 63% during the period. The Fund no longer owns the stock as the merger was completed in July 2010.
FGX International designed and marketed products under brands such as Foster Grant. The company was acquired by a European competitor, Essilor, during the reporting period at a premium, leading to a gain of over 50%. The Fund no longer owns the stock as the merger was completed in March 2010.
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| Performance Summary and Commentary |
| Eagle Small Cap Growth Fund |
Meet the managers | Bert L. Boksen, CFA, a Managing Director and Senior Vice President at Eagle Asset Management, Inc. (“Eagle”), has been responsible for the management of the Eagle Small Cap Growth Fund (the “Fund”) since 1995. Mr. Boksen has 33 years of investment experience. Eric Mintz, CFA, has 15 years of investment experience and has been Assistant Portfolio Manager since 2008.
Investment highlights | The Fund invests primarily in stocks of small-capitalization companies. Using a “bottom-up” approach, the Fund’s portfolio managers seek to capture the significant long-term capital appreciation potential of small, rapidly growing companies. A bottom-up method of analysis emphasizes the outlook at the company and industry level versus reliance on the general economy and/or market trends. The portfolio managers also look for small-cap growth companies that are reasonably priced. Since small-cap companies often have narrower markets than large-cap companies, the portfolio managers believe that conducting extensive proprietary research on small-cap growth companies may enable the Fund to capitalize on market inefficiencies and thus outperform the market.
This Morningstar Style Box™ shows the Fund’s investment style and size of companies held in the Fund.
Performance summary | The Fund’s Class A shares returned 34.62% (excluding front-end sales charges) during the fiscal year ended October 31, 2010, outperforming its benchmark index, which returned 28.67%. The Fund’s benchmark index, the Russell 2000® Growth Index, is an unmanaged index comprised of Russell 2000® companies with higher price-to-book ratios and higher forecasted growth values. The Russell 2000® Index is an unmanaged index comprised of the 2,000 smallest companies in the Russell 3000® Index. The Russell 3000® Index measures the performance of the 3,000 largest U.S. companies based on total market capitalization. Please keep in mind that an index is not available for direct investment; therefore its performance does not reflect the
expenses associated with the active management of an actual portfolio.
Growth of a $10,000 Investment from 11/1/00 to 10/31/10 (a)
(a) The Fund’s values and returns reflect the maximum front-end sales charge of 4.75%, fund expenses and the reinvestment of dividends; however, they do not reflect the deduction of taxes that you would pay on fund distributions or redemption of fund shares. The value of an investment in other share classes will differ due to each class’s respective sales charges and expenses.
Performance data represented is historical and does not guarantee future results. The investment return and principal value of an investment will fluctuate, and you may have a gain or loss when you sell shares. Current performance may be higher or lower than the performance data quoted. To obtain more current performance data as of the most recent month-end, please visit our website at eagleasset.com.
Performance discussion | The Fund had strong absolute performance during the one-year reporting period ended October 31, 2010. On an absolute basis, materials, consumer staples and energy led the Fund’s strong returns. In materials, the Fund’s holdings in the chemicals and metals & mining industries posted strong gains. The personal products industry fueled the consumer staples sector. In energy, the Fund’s investments in the energy equipment & services and oil, gas & consumable fuels industries had strong performance.
On an absolute basis, the financials, healthcare and industrials sectors lagged. The Fund’s investments in the financials sector posted a slightly negative return overall with the capital markets, thrifts & mortgage finance, and commercial banks industries each finishing down for the year. The healthcare sector finished positive for the year although investments in the healthcare providers & services and life science tools &
| | |
| Performance Summary and Commentary |
| Eagle Small Cap Growth Fund (cont’d) |
services industries underperformed. The construction & engineering industry posted negative returns in industrials.
The Fund outperformed its benchmark, the Russell 2000 Growth Index, during the one-year period ended October 31, 2010. The materials, energy, information technology, consumer staples and consumer discretionary sectors each contributed to the strong returns. The Fund’s overweight position in materials and energy amplified strong stock selection in those sectors. The Fund outperformed in information technology due to strong stock selection and an overweight position in the software, electronic equipment instruments & components and computers & peripherals industries. Consumer staples contributed to returns despite an underweight position due to very strong absolute performance. Consumer discretionary outperformed due to strong stock selection, particularly within the diversified consumer services industry.
The Fund underperformed the index in the industrials, financials and healthcare sectors during the reporting period. In industrials, the Fund’s overweight position in the weak construction & engineering industry and an underweight position in the strong performing airlines industry detracted from relative returns. Underperformance in the capital markets industry and an overweight position and underperformance in the consumer finance industry damaged returns in financials. In healthcare, underperformance in the healthcare providers & services industry, an overweight position and underperformance in the healthcare technology and life sciences tools & services industries dragged down relative returns.
Top performers | Shares in chemical producer Huntsman Corporation appreciated as the economic outlook has improved for this highly cyclical industry. Further, the company has successfully implemented a cost reduction program. The Fund continues to hold the stock.
TIBCO Software, Inc. provides enterprise middleware software solutions to businesses. It has delivered strong results and has been talked about as a potential acquisition candidate. We continue to hold the shares in the Fund.
Rovi Corporation, a provider of television guides for set-top boxes, has recently appreciated due to a new patent license agreement with Apple, in which Rovi will receive license fees for Apple’s use of Rovi’s patents in its AppleTV platform. We
believe that this bodes well for ROVI’s ability to receive license fees in the future from other companies with streaming on-line video technologies. The Fund continues to hold the stock.
Shares in oil equipment manufacturer Lufkin Industries, Inc. appreciated due to a sharp rise in oil prices, which helped boost prospects for a recovery in demand for Lufkin’s pump jacks. The Fund still holds its shares.
Auctioneer Sotheby’s shares appreciated during the year as it has become clear that demand for art purchases is increasing. This demand is furthered by an increased interest in Western art in China. We believe that this bodes well for Sotheby’s as it continues to increase its market share. We continue to hold the stock in the Fund.
Under performers | Genoptix, Inc. is a rapidly-growing independent clinical laboratory. The company has consistently beat earnings estimates, but recently started hiring a significant number of new sales representatives in anticipation of continued growth. We believe that it will take several quarters to complete this process so the Fund sold the stock.
True Religion Apparel, Inc. declined when the clothing manufacturer’s investors became concerned about management’s muted outlook and high inventory levels. The Fund took its profits and sold the stock.
FormFactor, Inc., a supplier of equipment used to electronically test computer memory, hoped to benefit from a recovery in sales of computers and servers. However, the company has had several execution missteps, including trying to transition manufacturing to a lower-cost region during the recovery. The Fund no longer holds the stock.
Shares of water pipe manufacturer Northwest Pipe Company fell after the company pre-announced disappointing third quarter 2009 results and delayed filing its financial reports due to an ongoing investigation in accounting irregularities. We continue to hold the stock as the company has recently stated compliance with SEC filing requirements and both pricing and volumes have improved. The stock also trades at a discount to tangible book value and represents a potential acquisition target.
Investment bank Gleacher & Company, Inc. declined on concerns that the fixed-income revenue growth that helped its third-quarter 2009 results likely will slow. The Fund sold the stock.
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE CAPITAL APPRECIATION FUND | | | | |
| Common stocks—99.5% | | | | | Shares | | | Value | |
| Apparel—1.9% | | | | | | | | | | | | |
| Nike, Inc., Class B | | | | | | | 138,800 | | | | $11,303,872 | |
| | | |
| Banks—2.0% | | | | | | | | | | | | |
| Northern Trust Corporation | | | | | | | 231,546 | | | | 11,491,628 | |
| | | |
| Beverages—3.8% | | | | | | | | | | | | |
| PepsiCo, Inc. | | | | | | | 340,409 | | | | 22,228,708 | |
| | | |
| Biotechnology—2.6% | | | | | | | | | | | | |
| Biogen Idec, Inc.* | | | | | | | 88,740 | | | | 5,564,885 | |
| Gilead Sciences, Inc.* | | | | | | | 253,977 | | | | 10,075,268 | |
| | | |
| Chemicals—1.3% | | | | | | | | | | | | |
| Praxair, Inc. | | | | | | | 80,919 | | | | 7,391,141 | |
| | | |
| Commercial services—3.2% | | | | | | | | | | | | |
| Mastercard, Inc., Class A | | | | | | | 78,600 | | | | 18,868,716 | |
| | | |
| Computers—5.3% | | | | | | | | | | | | |
| Apple, Inc.* | | | | | | | 102,600 | | | | 30,869,262 | |
| | | |
| Cosmetics/personal care—4.8% | | | | | | | | | | | | |
| Avon Products, Inc. | | | | | | | 453,245 | | | | 13,801,310 | |
| The Procter & Gamble Company | | | | | | | 232,239 | | | | 14,763,433 | |
| | | |
| Diversified financial services—5.6% | | | | | | | | | | | | |
| CME Group, Inc. | | | | | | | 81,110 | | | | 23,493,512 | |
| The Charles Schwab Corporation | | | | | | | 591,919 | | | | 9,115,553 | |
| | | |
| Electronics—2.7% | | | | | | | | | | | | |
| Thermo Fisher Scientific, Inc.* | | | | | | | 304,334 | | | | 15,648,854 | |
| | | |
| Healthcare products—9.2% | | | | | | | | | | | | |
| Baxter International, Inc. | | | | | | | 360,793 | | | | 18,364,364 | |
| Johnson & Johnson | | | | | | | 310,347 | | | | 19,759,793 | |
| St. Jude Medical, Inc.* | | | | | | | 411,188 | | | | 15,748,500 | |
| | | |
| Internet—1.9% | | | | | | | | | | | | |
| Equinix, Inc.* | | | | | | | 135,369 | | | | 11,403,485 | |
| | | |
| Oil & gas—4.2% | | | | | | | | | | | | |
| Occidental Petroleum Corporation | | | | | | | 141,400 | | | | 11,118,282 | |
| Southwestern Energy Company* | | | | | | | 393,106 | | | | 13,306,638 | |
| | | |
| Oil & gas services—8.5% | | | | | | | | | | | | |
| Halliburton Company | | | | | | | 568,041 | | | | 18,097,786 | |
| Schlumberger Ltd. | | | | | | | 453,711 | | | | 31,709,862 | |
| | | |
| Pharmaceuticals—1.2% | | | | | | | | | | | | |
| Teva Pharmaceutical Industries Ltd., Sponsored ADR | | | | | | | 139,165 | | | | 7,222,664 | |
| | | |
| Real estate—3.1% | | | | | | | | | | | | |
| CB Richard Ellis Group, Inc., Class A* | | | | | | | 997,432 | | | | 18,302,877 | |
| | | |
| Retail—10.4% | | | | | | | | | | | | |
| Costco Wholesale Corporation | | | | | | | 327,848 | | | | 20,579,019 | |
| Lowe’s Companies, Inc. | | | | | | | 962,581 | | | | 20,531,853 | |
| Staples, Inc. | | | | | | | 968,010 | | | | 19,815,165 | |
| | | |
| Semiconductors—3.8% | | | | | | | | | | | | |
| Broadcom Corporation, Class A | | | | | | | 262,400 | | | | 10,690,176 | |
| Xilinx, Inc. | | | | | | | 447,041 | | | | 11,985,169 | |
| | | |
| Software—6.6% | | | | | | | | | | | | |
| Microsoft Corporation | | | | | | | 669,850 | | | | 17,844,804 | |
| Oracle Corporation | | | | | | | 715,838 | | | | 21,045,637 | |
| | | |
| Telecommunications—17.4% | | | | | | | | | | | | |
| American Tower Corporation, Class A* | | | | | | | 569,504 | | | | 29,392,101 | |
| Cisco Systems, Inc.* | | | | | | | 1,046,099 | | | | 23,882,440 | |
| Crown Castle International Corporation* | | | | | | | 433,163 | | | | 18,677,989 | |
| | | | | | | | | | | | |
| | | | | |
| Common stocks—99.5% | | | | | Shares | | | Value | |
| QUALCOMM, Inc. | | | | | | | 660,105 | | | | $29,790,539 | |
| Total common stocks (cost $472,664,506) | | | | | | | | | | | 583,885,285 | |
| | | |
| Short term investments—1.8% | | | | | |
| Principal
amount |
| | | Value | |
| JP Morgan Commercial Paper Sweep, 0.15% (cost $10,318,600) | | | | $10,318,600 | | | | 10,318,600 | |
| |
| Total investment portfolio (cost $482,983,106) 101.3% | | | | 594,203,885 | |
| | | |
| Liabilities in excess of other assets (1.3)% | | | | | | | | | | | (7,738,427 | ) |
| | | |
| Net assets 100.0% | | | | | | | | | | | $586,465,458 | |
| | | |
| * Non-income producing security | | | | | | | | | | | | |
| | | |
| ADR—American depository receipt | | | | | | | | | | | | |
| | | | |
|
| Sector allocation (unaudited) | |
| Sector | | Percent of net assets | |
| Consumer, non-cyclical | | | 25.0% | |
| Communications | | | 19.3% | |
| Technology | | | 15.7% | |
| Energy | | | 12.6% | |
| Financial | | | 12.4% | |
| Consumer, cyclical | | | 12.3% | |
| Industrial | | | 2.7% | |
| Basic materials | | | 1.3% | |
| | | | | | | | | | | | |
| | | | |
| EAGLE GROWTH & INCOME FUND | | | | | | | | | |
| Common stocks—94.7% | | | | | Shares | | | Value | |
| Domestic—72.5% | | | | | | | | | | | | |
| Aerospace/defense—1.9% | | | | | | | | | | | | |
| Lockheed Martin Corporation | | | | | | | 55,700 | | | | $3,970,853 | |
| | | |
| Agriculture—3.4% | | | | | | | | | | | | |
| Lorillard, Inc. | | | | | | | 25,300 | | | | 2,159,102 | |
| Philip Morris International, Inc. | | | | | | | 85,180 | | | | 4,983,030 | |
| | | |
| Banks—12.2% | | | | | | | | | | | | |
| Bank of America Corporation | | | | | | | 247,500 | | | | 2,831,400 | |
| Fifth Third Bancorp | | | | | | | 323,571 | | | | 4,064,052 | |
| JPMorgan Chase & Company | | | | | | | 131,552 | | | | 4,950,302 | |
| KeyCorp | | | | | | | 465,660 | | | | 3,813,755 | |
| SVB Financial Group* | | | | | | | 80,800 | | | | 3,501,872 | |
| U.S. Bancorp | | | | | | | 262,200 | | | | 6,339,996 | |
| | | |
| Beverages—3.0% | | | | | | | | | | | | |
| The Coca-Cola Company | | | | | | | 101,200 | | | | 6,205,584 | |
| | | |
| Biotechnology—2.1% | | | | | | | | | | | | |
| Gilead Sciences, Inc.* | | | | | | | 112,482 | | | | 4,462,161 | |
| | | |
| Commercial services—2.0% | | | | | | | | | | | | |
| Paychex, Inc. | | | | | | | 150,500 | | | | 4,168,850 | |
| | | |
| Computers—3.5% | | | | | | | | | | | | |
| Apple, Inc.* | | | | | | | 7,435 | | | | 2,236,968 | |
| Dell, Inc.* | | | | | | | 351,500 | | | | 5,054,570 | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 21 | |
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE GROWTH & INCOME FUND (cont’d) | | | | |
| Common stocks—94.7% | | | | | Shares | | | Value | |
| Diversified financial services—1.6% | | | | | | | | | | | | |
| AllianceBernstein Holding LP | | | | | | | 137,700 | | | | $3,359,880 | |
| | | |
| Electric—2.1% | | | | | | | | | | | | |
| Entergy Corporation | | | | | | | 59,600 | | | | 4,441,988 | |
| | | |
| Food—2.6% | | | | | | | | | | | | |
| Sysco Corporation | | | | | | | 187,090 | | | | 5,511,671 | |
| | | |
| Healthcare products—1.7% | | | | | | | | | | | | |
| Varian Medical Systems, Inc.* | | | | | | | 55,188 | | | | 3,488,985 | |
| | | |
| Insurance—3.7% | | | | | | | | | | | | |
| ACE Ltd. | | | | | | | 54,645 | | | | 3,247,006 | |
| Hartford Financial Services Group, Inc. | | | | | | | 179,500 | | | | 4,304,410 | |
| | | |
| Internet—2.6% | | | | | | | | | | | | |
| Google, Inc., Class A* | | | | | | | 8,700 | | | | 5,333,013 | |
| | | |
| Iron/steel—1.8% | | | | | | | | | | | | |
| United States Steel Corporation | | | | | | | 88,200 | | | | 3,774,078 | |
| | | |
| Media—2.9% | | | | | | | | | | | | |
| Comcast Corporation, Class A | | | | | | | 309,700 | | | | 5,986,501 | |
| | | |
| Oil & gas—6.0% | | | | | | | | | | | | |
| ConocoPhillips | | | | | | | 63,200 | | | | 3,754,080 | |
| Ensco PLC, Sponsored ADR | | | | | | | 99,120 | | | | 4,593,221 | |
| Exxon Mobil Corporation | | | | | | | 63,955 | | | | 4,251,089 | |
| | | |
| Pharmaceuticals—5.5% | | | | | | | | | | | | |
| Eli Lilly & Company | | | | | | | 54,775 | | | | 1,928,080 | |
| Pfizer, Inc. | | | | | | | 263,200 | | | | 4,579,680 | |
| Teva Pharmaceutical Industries Ltd., Sponsored ADR | | | | | | | 96,100 | | | | 4,987,590 | |
| | | |
| Retail—2.4% | | | | | | | | | | | | |
| McDonald’s Corporation | | | | | | | 64,000 | | | | 4,977,280 | |
| | | |
| Semiconductors—2.5% | | | | | | | | | | | | |
| Intel Corporation | | | | | | | 260,300 | | | | 5,224,221 | |
| | | |
| Software—5.4% | | | | | | | | | | | | |
| Fiserv, Inc.* | | | | | | | 86,650 | | | | 4,724,158 | |
| Microsoft Corporation | | | | | | | 241,400 | | | | 6,430,896 | |
| | | |
| Telecommunications—3.6% | | | | | | | | | | | | |
| Amdocs Ltd.* | | | | | | | 104,300 | | | | 3,199,924 | |
| Leap Wireless International, Inc.* | | | | | | | 77,900 | | | | 888,839 | |
| Qwest Communications International, Inc. | | | | | | | 555,000 | | | | 3,663,000 | |
| Total domestic common stocks (cost $141,189,028) | | | | | | | | | | | 151,392,085 | |
| | | |
| Foreign—22.2% | | | | | | | | | | | | |
| Beverages—2.1% | | | | | | | | | | | | |
| Foster’s Group Ltd. | | | | | | | 798,000 | | | | 4,565,016 | |
| | | |
| Diversified financial services—2.3% | | | | | | | | | | | | |
| Hong Kong Exchanges and Clearing Ltd. | | | | | | | 218,200 | | | | 4,846,133 | |
| | | |
| Electric—2.1% | | | | | | | | | | | | |
| Enel SpA | | | | | | | 767,200 | | | | 4,377,424 | |
| | | |
| Food—2.2% | | | | | | | | | | | | |
| Nestle SA | | | | | | | 85,700 | | | | 4,697,678 | |
| | | |
| Media—1.0% | | | | | | | | | | | | |
| Pearson PLC | | | | | | | 133,254 | | | | 2,038,044 | |
| | | |
| Oil & gas—5.6% | | | | | | | | | | | | |
| Canadian Oil Sands Trust | | | | | | | 148,900 | | | | 3,731,625 | |
| ENI SpA | | | | | | | 148,300 | | | | 3,338,756 | |
| Seadrill Ltd. | | | | | | | 152,700 | | | | 4,625,377 | |
| | | | | | | | | | | | |
| | | | | |
| Common stocks—94.7% | | | | | Shares | | | Value | |
| Pharmaceuticals—2.1% | | | | | | | | | | | | |
| Novartis AG | | | | | | | 74,800 | | | | $4,336,507 | |
| | | |
| Telecommunications—4.8% | | | | | | | | | | | | |
| Telefonica SA | | | | | | | 123,700 | | | | 3,336,580 | |
| Telstra Corporation Ltd. | | | | | | | 1,559,000 | | | | 4,086,328 | |
| Vodafone Group PLC | | | | | | | 887,535 | | | | 2,415,508 | |
| Total foreign common stocks (cost $39,933,046) | | | | | | | | | | | 46,394,976 | |
| Total common stocks (cost $181,122,074) | | | | | | | | | | | 197,787,061 | |
| | | |
| Investment companies—1.9% | | | | | | | | | | | | |
| Apollo Investment Corporation | | | | | | | 357,000 | | | | 3,923,430 | |
| Total investment companies (cost $3,471,262) | | | | | | | | | | | 3,923,430 | |
| | | |
| Preferred stocks—1.4% | | | | | | | | | | | | |
| Banks—1.4% | | | | | | | | | | | | |
| Bank of America Corporation, FRN, 3.00%, Series H | | | | | | | 60,000 | | | | 963,000 | |
| Fifth Third Bancorp, 8.50%, Series G (convertible) | | | | | | | 14,200 | | | | 1,876,814 | |
| Total preferred stocks (cost $1,958,343) | | | | | | | | | | | 2,839,814 | |
| | | |
| Short term investments—1.7% | | | | | |
| Principal
amount |
| | | Value | |
| JP Morgan Commercial Paper Sweep, 0.15% (cost $3,634,756) | | | | | | | $3,634,756 | | | | 3,634,756 | |
| |
| Total investment portfolio (cost $190,186,435) 99.7% | | | | 208,185,061 | |
| | | |
| Other assets in excess of liabilities 0.3% | | | | | | | | | | | 523,138 | |
| | | |
| Net assets 100.0% | | | | | | | | | | | $208,708,199 | |
| | | |
| * Non-income producing security | | | | | | | | | | | | |
| |
ADR—American depository receipt FRN—Floating rate notes reset their interest rates on a semiannual or
quarterly basis. | | | | | |
| | | | |
| |
| Sector allocation (unaudited) | | | |
| Sector | | Percent of net assets | |
| Consumer, non-cyclical | | | 26.8% | |
| Financial | | | 24.8% | |
| Communications | | | 14.8% | |
| Energy | | | 11.6% | |
| Technology | | | 11.4% | |
| Utilities | | | 4.2% | |
| Consumer, cyclical | | | 2.4% | |
| Industrial | | | 1.9% | |
| Basic materials | | | 1.8% | |
| | |
| 22 | | The accompanying notes are an integral part of the financial statements. |
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE INTERNATIONAL EQUITY FUND | | | | | | | | | |
| Common stocks—94.5% | | | | | Shares | | | Value | |
| Australia—2.1% | | | | | | | | | | | | |
| Asciano Group* | | | | | | | 110,130 | | | | $169,334 | |
| MAp Group | | | | | | | 214,017 | | | | 641,609 | |
| Newcrest Mining Ltd. | | | | | | | 23,951 | | | | 939,261 | |
| | | |
| Austria—1.1% | | | | | | | | | | | | |
| Erste Group Bank AG | | | | | | | 21,397 | | | | 965,777 | |
| | | |
| Brazil—2.3% | | | | | | | | | | | | |
| All America Latina Logistica SA | | | | | | | 38,456 | | | | 363,684 | |
| Amil Participacoes SA | | | | | | | 12,913 | | | | 131,386 | |
| Diagnosticos da America SA | | | | | | | 28,896 | | | | 350,940 | |
| Hypermarcas SA* | | | | | | | 49,522 | | | | 818,425 | |
| Souza Cruz SA | | | | | | | 4,891 | | | | 255,869 | |
| | | |
| Britain—14.2% | | | | | | | | | | | | |
| Anglo American PLC | | | | | | | 6,038 | | | | 280,960 | |
| ARM Holdings PLC | | | | | | | 61,228 | | | | 359,398 | |
| Barclays PLC | | | | | | | 149,761 | | | | 661,435 | |
| BG Group PLC | | | | | | | 30,717 | | | | 597,583 | |
| BHP Billiton PLC | | | | | | | 27,571 | | | | 977,889 | |
| Burberry Group PLC | | | | | | | 5,464 | | | | 89,216 | |
| Cairn Energy PLC* | | | | | | | 27,032 | | | | 167,152 | |
| Compass Group PLC | | | | | | | 51,790 | | | | 424,472 | |
| Diageo PLC | | | | | | | 12,098 | | | | 223,318 | |
| GlaxoSmithKline PLC | | | | | | | 25,824 | | | | 505,239 | |
| HSBC Holdings PLC | | | | | | | 48,150 | | | | 501,359 | |
| Imperial Tobacco Group PLC | | | | | | | 22,061 | | | | 706,635 | |
| Lloyds Banking Group PLC* | | | | | | | 956,981 | | | | 1,057,139 | |
| Lonmin PLC* | | | | | | | 2,913 | | | | 81,637 | |
| Reckitt Benckiser Group PLC | | | | | | | 13,157 | | | | 735,977 | |
| Rio Tinto PLC | | | | | | | 36,617 | | | | 2,377,413 | |
| Rolls-Royce Group PLC | | | | | | | 33,422 | | | | 346,760 | |
| Rolls-Royce Group PLC, Class C (a)* | | | | | | | 2,139,008 | | | | 3,427 | |
| Royal Bank of Scotland Group PLC* | | | | | | | 504,787 | | | | 360,826 | |
| SABMiller PLC | | | | | | | 12,117 | | | | 392,876 | |
| Vodafone Group PLC | | | | | | | 338,535 | | | | 921,354 | |
| WM Morrison Supermarkets PLC | | | | | | | 32,366 | | | | 152,370 | |
| | | |
| Canada—5.1% | | | | | | | | | | | | |
| Agnico-Eagle Mines Ltd. | | | | | | | 2,119 | | | | 164,342 | |
| Barrick Gold Corporation | | | | | | | 30,379 | | | | 1,463,101 | |
| Canadian Pacific Railway Ltd. | | | | | | | 1,167 | | | | 76,068 | |
| First Quantum Minerals Ltd. | | | | | | | 2,957 | | | | 258,937 | |
| Goldcorp Inc. | | | | | | | 12,545 | | | | 560,152 | |
| IAMGOLD Corporation | | | | | | | 3,033 | | | | 55,343 | |
| Ivanhoe Mines Ltd./CA* | | | | | | | 15,203 | | | | 364,013 | |
| Kinross Gold Corporation | | | | | | | 7,847 | | | | 141,183 | |
| Potash Corporation of Saskatchewan, Inc. | | | | | | | 1,485 | | | | 214,764 | |
| Silver Wheaton Corporation* | | | | | | | 21,030 | | | | 604,569 | |
| Teck Resources Ltd., Class B | | | | | | | 7,764 | | | | 347,131 | |
| | | |
| China—5.7% | | | | | | | | | | | | |
| Anhui Conch Cement Company Ltd., Class H | | | | | | | 30,000 | | | | 127,093 | |
| Baidu, Inc./China, Sponsored ADR* | | | | | | | 5,427 | | | | 597,024 | |
| China Construction Bank Corporation, Class H | | | | | | | 509,000 | | | | 486,257 | |
| China National Building Material Company Ltd., Class H | | | | | | | 56,000 | | | | 137,603 | |
| China Yurun Food Group Ltd. | | | | | | | 145,000 | | | | 564,006 | |
| Ctrip.com International Ltd., Sponsored ADR* | | | | | | | 6,941 | | | | 361,418 | |
| Dongfang Electric Corporation Ltd., Class H | | | | | | | 9,400 | | | | 45,719 | |
| Dongfeng Motor Group Company Ltd., Class H | | | | | | | 148,000 | | | | 324,365 | |
| Golden Eagle Retail Group Ltd. | | | | | | | 100,000 | | | | 266,869 | |
| Hengan International Group Company Ltd. | | | | | | | 35,000 | | | | 330,622 | |
| | | | | | | | | | | | |
| | | |
| Common stocks—94.5% | | | | | Shares | | | Value | |
| China (cont’d) | | | | | | | | | | | | |
| Intime Department Store Group Co. Ltd. | | | | | | | 87,000 | | | | $133,341 | |
| Lianhua Supermarket Holdings Company Ltd., Class H | | | | | | | 45,000 | | | | 191,582 | |
| Sany Heavy Equipment International Holdings Company Ltd. | | | | | | | 27,000 | | | | 38,665 | |
| Shandong Weigao Group Medical Polymer Company Ltd., Class H | | | | | | | 24,000 | | | | 63,628 | |
| Sinopharm Group Company, Class H | | | | | | | 78,800 | | | | 310,239 | |
| Sinotruk Hong Kong Ltd. | | | | | | | 41,500 | | | | 47,933 | |
| Tingyi Cayman Islands Holding Corporation | | | | | | | 176,000 | | | | 479,874 | |
| Weichai Power Co. Ltd., Class H | | | | | | | 4,000 | | | | 52,533 | |
| Wumart Stores, Inc., Class H | | | | | | | 110,000 | | | | 259,868 | |
| | | |
| Czech—1.1% | | | | | | | | | | | | |
| Komercni Banka AS | | | | | | | 4,211 | | | | 955,396 | |
| | | |
| Denmark—1.5% | | | | | | | | | | | | |
| Carlsberg AS, Class B | | | | | | | 4,690 | | | | 512,932 | |
| Novo Nordisk AS, Class B | | | | | | | 6,083 | | | | 638,968 | |
| Pandora AS* | | | | | | | 2,682 | | | | 130,143 | |
| | | |
| Finland—1.2% | | | | | | | | | | | | |
| Fortum Oyj | | | | | | | 6,837 | | | | 193,836 | |
| Kesko Oyj, Class B | | | | | | | 2,499 | | | | 123,890 | |
| Stora Enso Oyj, Class R | | | | | | | 31,991 | | | | 318,578 | |
| UPM—Kymmene Oyj | | | | | | | 21,007 | | | | 350,204 | |
| | | |
| France—5.5% | | | | | | | | | | | | |
| Aeroports de Paris | | | | | | | 2,792 | | | | 237,157 | |
| BNP Paribas | | | | | | | 8,815 | | | | 644,721 | |
| Carrefour SA | | | | | | | 5,211 | | | | 281,258 | |
| CFAO SA | | | | | | | 6,851 | | | | 304,460 | |
| Cie Generale d’Optique Essilor International SA | | | | | | | 5,259 | | | | 351,188 | |
| Danone | | | | | | | 9,211 | | | | 582,984 | |
| Eutelsat Communications | | | | | | | 5,674 | | | | 213,301 | |
| Iliad SA | | | | | | | 864 | | | | 97,283 | |
| LVMH Moet Hennessy Louis Vuitton SA | | | | | | | 5,574 | | | | 873,539 | |
| PPR | | | | | | | 3,236 | | | | 531,129 | |
| Schneider Electric SA | | | | | | | 1,577 | | | | 223,877 | |
| Sodexo | | | | | | | 2,700 | | | | 175,718 | |
| Technip SA | | | | | | | 1,645 | | | | 138,264 | |
| | | |
| Germany—6.5% | | | | | | | | | | | | |
| Bayer AG | | | | | | | 1,737 | | | | 130,060 | |
| Bayerische Motoren Werke AG | | | | | | | 4,381 | | | | 314,456 | |
| Beiersdorf AG | | | | | | | 2,221 | | | | 144,817 | |
| Bilfinger Berger SE | | | | | | | 2,199 | | | | 160,160 | |
| Continental AG* | | | | | | | 1,918 | | | | 166,928 | |
| Daimler AG* | | | | | | | 13,769 | | | | 909,912 | |
| Deutsche Boerse AG | | | | | | | 3,011 | | | | 211,882 | |
| Fraport AG | | | | | | | 21,596 | | | | 1,371,229 | |
| Fresenius SE | | | | | | | 8,539 | | | | 753,601 | |
| HeidelbergCement AG | | | | | | | 2,865 | | | | 150,104 | |
| Henkel AG & Co. KGaA | | | | | | | 356 | | | | 17,681 | |
| MAN SE | | | | | | | 7,324 | | | | 805,290 | |
| Metro AG | | | | | | | 1,638 | | | | 114,809 | |
| Siemens AG | | | | | | | 1,875 | | | | 214,198 | |
| | | |
| Greece—0.5% | | | | | | | | | | | | |
| Coca Cola Hellenic Bottling Company SA | | | | | | | 15,771 | | | | 408,271 | |
| | | |
| Hong Kong—6.9% | | | | | | | | | | | | |
| Belle International Holdings Ltd. | | | | | | | 299,000 | | | | 543,104 | |
| China Merchants Holdings International Company Ltd. | | | | | | | 148,970 | | | | 521,791 | |
| China Overseas Land & Investment Ltd. | | | | | | | 282,000 | | | | 595,538 | |
| China Resources Enterprise Ltd. | | | | | | | 232,000 | | | | 983,303 | |
| Galaxy Entertainment Group Ltd.* | | | | | | | 5,000 | | | | 4,736 | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 23 | |
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE INTERNATIONAL EQUITY FUND (cont’d) | | | | |
| Common stocks—94.5% | | | | | Shares | | | Value | |
| Hong Kong (cont’d) | | | | | | | | | | | | |
| Geely Automobile Holdings Ltd. | | | | | | | 390,000 | | | | $220,658 | |
| Hang Lung Properties Ltd. | | | | | | | 380,000 | | | | 1,871,124 | |
| Hong Kong Exchanges and Clearing Ltd. | | | | | | | 12,000 | | | | 266,515 | |
| Li & Fung Ltd. | | | | | | | 128,000 | | | | 680,493 | |
| SJM Holdings Ltd. | | | | | | | 48,000 | | | | 71,538 | |
| | | |
| India—3.5% | | | | | | | | | | | | |
| Axis Bank Ltd., Sponsored GDR | | | | | | | 13,272 | | | | 439,834 | |
| HDFC Bank Ltd., Sponsored ADR | | | | | | | 4,698 | | | | 812,566 | |
| ICICI Bank Ltd., Sponsored ADR | | | | | | | 9,528 | | | | 500,982 | |
| Larsen & Toubro Ltd., Sponsored GDR | | | | | | | 18,530 | | | | 863,128 | |
| Reliance Capital Ltd., Sponsored GDR | | | | | | | 6,560 | | | | 120,179 | |
| State Bank of India, Sponsored GDR | | | | | | | 800 | | | | 110,400 | |
| United Spirits Ltd., Sponsored GDR | | | | | | | 7,014 | | | | 117,835 | |
| | | |
| Indonesia—0.3% | | | | | | | | | | | | |
| Indofood CBP Sukses Makmur TBK PT* | | | | | | | 359,000 | | | | 228,957 | |
| | | |
| Ireland—0.5% | | | | | | | | | | | | |
| Ryanair Holdings PLC | | | | | | | 11,322 | | | | 65,112 | |
| WPP PLC | | | | | | | 32,288 | | | | 376,009 | |
| | | |
| Israel—0.4% | | | | | | | | | | | | |
| Teva Pharmaceutical Industries Ltd., Sponsored ADR | | | | | | | 7,033 | | | | 365,013 | |
| | | |
| Italy—0.3% | | | | | | | | | | | | |
| Buzzi Unicem SpA | | | | | | | 7,955 | | | | 91,342 | |
| Saipem SpA | | | | | | | 3,382 | | | | 150,112 | |
| | | |
| Japan—8.6% | | | | | | | | | | | | |
| Aisin Seiki Company Ltd. | | | | | | | 4,301 | | | | 134,335 | |
| Asahi Glass Co. Ltd. | | | | | | | 19,000 | | | | 181,397 | |
| Canon Inc. | | | | | | | 9,273 | | | | 426,405 | |
| Daikin Industries Ltd. | | | | | | | 4,770 | | | | 165,107 | |
| Denso Corporation | | | | | | | 3,811 | | | | 118,635 | |
| Fanuc Ltd. | | | | | | | 3,300 | | | | 480,174 | |
| Honda Motor Company Ltd. | | | | | | | 24,190 | | | | 873,261 | |
| Isuzu Motors Ltd. | | | | | | | 74,000 | | | | 283,134 | |
| ITOCHU Corporation | | | | | | | 30,700 | | | | 270,544 | |
| Komatsu Ltd. | | | | | | | 19,100 | | | | 465,088 | |
| Mitsubishi Corporation | | | | | | | 16,000 | | | | 386,623 | |
| Mitsubishi Electric Corporation | | | | | | | 20,000 | | | | 186,588 | |
| Nidec Corporation | | | | | | | 6,100 | | | | 600,042 | |
| Nissan Motor Company Ltd. | | | | | | | 39,900 | | | | 349,935 | |
| NTT DoCoMo Inc. | | | | | | | 69 | | | | 116,388 | |
| Ricoh Co. Ltd. | | | | | | | 5,000 | | | | 69,500 | |
| Shiseido Company Ltd. | | | | | | | 14,000 | | | | 292,631 | |
| SMC Corporation | | | | | | | 1,400 | | | | 212,855 | |
| Softbank Corporation | | | | | | | 10,700 | | | | 343,059 | |
| Suzuki Motor Corporation | | | | | | | 17,400 | | | | 426,257 | |
| Toyota Motor Corporation | | | | | | | 6,541 | | | | 231,532 | |
| Unicharm Corporation | | | | | | | 15,416 | | | | 587,531 | |
| | | |
| Luxembourg—0.5% | | | | | | | | | | | | |
| L’Occitane International SA* | | | | | | | 63,264 | | | | 186,089 | |
| SES SA | | | | | | | 9,209 | | | | 236,211 | |
| | | |
| Macau—0.5% | | | | | | | | | | | | |
| Sands China Ltd.* | | | | | | | 152,400 | | | | 332,277 | |
| Wynn Macau Ltd.* | | | | | | | 41,200 | | | | 91,737 | |
| | | |
| Mexico—1.1% | | | | | | | | | | | | |
| Fomento Economico Mexicano, SAB de CV,Sponsored ADR | | | | | | | 11,687 | | | | 641,733 | |
| Grupo Financiero Banorte, SAB de CV, Class O | | | | | | | 57,083 | | | | 244,225 | |
| | | |
| Netherlands—4.1% | | | | | | | | | | | | |
| ASML Holding NV | | | | | | | 1,503 | | | | 49,426 | |
| | | | | | | | | | | | |
| | | |
| Common stocks—94.5% | | | | | Shares | | | Value | |
| Netherlands (cont’d) | | | | | | | | | | | | |
| European Aeronautic Defence and Space Company NV* | | | | | | | 7,152 | | | | $187,984 | |
| Heineken NV | | | | | | | 4,431 | | | | 224,604 | |
| ING Groep NV* | | | | | | | 52,189 | | | | 556,366 | |
| Koninklijke KPN NV | | | | | | | 20,757 | | | | 346,675 | |
| Koninklijke Philips Electronics NV | | | | | | | 6,557 | | | | 198,309 | |
| Royal Dutch Shell PLC, Class A | | | | | | | 19,723 | | | | 639,632 | |
| Unilever NV | | | | | | | 42,782 | | | | 1,268,585 | |
| | | |
| Norway—0.5% | | | | | | | | | | | | |
| DnB NOR ASA | | | | | | | 11,163 | | | | 153,247 | |
| Marine Harvest ASA | | | | | | | 296,787 | | | | 294,932 | |
| | | |
| Portugal—0.2% | | | | | | | | | | | | |
| Jeronimo Martins SGPS SA | | | | | | | 13,565 | | | | 203,524 | |
| | | |
| Russian Federation—5.4% | | | | | | | | | | | | |
| IDGC Holding JSC* | | | | | | | 1,976,623 | | | | 351,839 | |
| Magnit OJSC, Sponsored GDR | | | | | | | 22,221 | | | | 594,190 | |
| NovaTek OAO, Sponsored GDR | | | | | | | 1,150 | | | | 109,997 | |
| Novorossiysk Commercial Sea Port, Sponsored GDR | | | | | | | 6,256 | | | | 55,991 | |
| OJSC Enel OGK-5* | | | | | | | 116,934 | | | | 9,530 | |
| Pharmstandard, Sponsored GDR* | | | | | | | 6,738 | | | | 175,188 | |
| Rosneft Oil Company, Sponsored GDR* | | | | | | | 47,752 | | | | 332,831 | |
| Sberbank | | | | | | | 576,485 | | | | 1,910,471 | |
| VTB Bank OJSC, Sponsored GDR | | | | | | | 70,738 | | | | 468,286 | |
| X5 Retail Group NV, Sponsored GDR* | | | | | | | 11,984 | | | | 502,130 | |
| | | |
| Singapore—0.8% | | | | | | | | | | | | |
| CapitaLand Ltd. | | | | | | | 204,000 | | | | 614,098 | |
| Genting Singapore PLC* | | | | | | | 24,000 | | | | 40,238 | |
| | | |
| South Africa—2.7% | | | | | | | | | | | | |
| Aquarius Platinum Ltd. | | | | | | | 11,227 | | | | 65,010 | |
| Aspen Pharmacare Holdings Ltd.* | | | | | | | 35,409 | | | | 472,626 | |
| Shoprite Holdings Ltd. | | | | | | | 60,453 | | | | 854,540 | |
| Standard Bank Group Ltd. | | | | | | | 38,785 | | | | 571,312 | |
| Tiger Brands Ltd. | | | | | | | 10,873 | | | | 291,530 | |
| | | |
| South Korea—0.6% | | | | | | | | | | | | |
| Celltrion, Inc.* | | | | | | | 3,136 | | | | 69,525 | |
| Hyundai Motor Company | | | | | | | 2,754 | | | | 416,850 | |
| | | |
| Spain—0.1% | | | | | | | | | | | | |
| Amadeus IT Holding SA, Class A* | | | | | | | 4,691 | | | | 95,551 | |
| | | |
| Sweden—1.8% | | | | | | | | | | | | |
| Atlas Copco AB, Class A | | | | | | | 20,032 | | | | 418,655 | |
| Elekta AB, Class B | | | | | | | 4,011 | | | | 151,801 | |
| Hennes & Mauritz AB, Class B | | | | | | | 9,524 | | | | 335,639 | |
| Swedish Match AB | | | | | | | 1,968 | | | | 55,007 | |
| Volvo AB, Class B* | | | | | | | 39,008 | | | | 528,212 | |
| | | |
| Switzerland—6.2% | | | | | | | | | | | | |
| ABB Ltd.* | | | | | | | 19,716 | | | | 408,325 | |
| Dufry Group* | | | | | | | 4,394 | | | | 510,375 | |
| Flughafen Zuerich AG | | | | | | | 395 | | | | 145,609 | |
| Nestle SA | | | | | | | 16,157 | | | | 885,652 | |
| Nobel Biocare Holding AG | | | | | | | 5,025 | | | | 83,082 | |
| Novartis AG | | | | | | | 9,367 | | | | 543,049 | |
| Swiss Reinsurance Company Ltd. | | | | | | | 5,253 | | | | 252,226 | |
| Syngenta AG | | | | | | | 938 | | | | 259,462 | |
| The Swatch Group AG | | | | | | | 700 | | | | 267,537 | |
| UBS AG* | | | | | | | 20,186 | | | | 342,514 | |
| Xstrata PLC | | | | | | | 78,637 | | | | 1,524,018 | |
| | |
| 24 | | The accompanying notes are an integral part of the financial statements. |
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE INTERNATIONAL EQUITY FUND (cont’d) | | | | |
| Common stocks—94.5% | | | | | Shares | | | Value | |
| Taiwan—2.0% | | | | | | | | | | | | |
| HTC Corporation | | | | | | | 75,800 | | | | $1,714,625 | |
| | | |
| Ukraine—0.3% | | | | | | | | | | | | |
| Raiffeisen Bank Aval* | | | | | | | 1,908,985 | | | | 98,907 | |
| Ukrsotsbank JSCB* | | | | | | | 2,466,696 | | | | 132,923 | |
| UkrTelecom* | | | | | | | 401,238 | | | | 25,997 | |
| | | |
| United Arab Emirates—0.4% | | | | | | | | | | | | |
| Dragon Oil PLC* | | | | | | | 43,982 | | | | 311,497 | |
| Total common stocks (cost $65,170,004) | | | | | | | | | | | 79,434,877 | |
| | | |
| Investment companies—5.1% | | | | | | | | | | | | |
| India—2.5% | | | | | | | | | | | | |
| iShares MSCI India* | | | | | | | 257,400 | | | | 2,077,570 | |
| | | |
| United States—2.6% | | | | | | | | | | | | |
| Market Vectors—Gold Miners ETF | | | | | | | 38,817 | | | | 2,222,273 | |
| Total investment companies (cost $3,515,370) | | | | | | | | | | | 4,299,843 | |
| | | |
| Preferred stocks—0.9% | | | | | | | | | | | | |
| Germany—0.9% | | | | | | | | | | | | |
| Henkel AG & Co. KGaA | | | | | | | 3,261 | | | | 192,348 | |
| Porsche Automobil Holding SE | | | | | | | 644 | | | | 33,042 | |
| Volkswagen AG | | | | | | | 3,421 | | | | 515,020 | |
| Total preferred stocks (cost $551,933) | | | | | | | | | | | 740,410 | |
| | | |
Total investment portfolio
(cost $69,237,307)—100.5% | | | | | | | | | | | 84,475,130 | |
| | | |
| Liabilities in excess of other assets (0.5)% | | | | | | | | | | | (409,276 | ) |
| | | |
| Total Net assets 100.0% | | | | | | | | | | | $84,065,854 | |
| |
* Non-income producing security (a) Resticted security deemed to be illiquid for purposes of compliance limitations on holdings of illiquid securities. At October 31, 2010, this security aggregated $3,427 or 0.0% of the net assets of the Fund. | | | | | |
| ADR—American depository receipt | | | | | |
| GDR—Global depository receipt | | | | | |
| ETF—Exchange-traded funds | | | | | |
| | | | |
| |
| Sector allocation (unaudited) | | | |
| Sector | | Percent of net assets | |
| Financial | | | 24.1% | |
| Consumer, non-cyclical | | | 23.6% | |
| Consumer, cyclical | | | 13.9% | |
| Basic materials | | | 13.6% | |
| Industrial | | | 11.7% | |
| Communications | | | 4.1% | |
| Technology | | | 3.1% | |
| Energy | | | 3.0% | |
| Diversified | | | 2.8% | |
| Utilities | | | 0.6% | |
| | | | | | | | | | | | | | | | | | | | | | |
|
| Forward foreign currency contracts outstanding | |
Contract
to
deliver | | | Counter
party | | In
exchange
for | | | Delivery
date | | | Unrealized
appreciation
(depreciation) | |
| CZK | | | 5,030,063 | | | Credit Suisse | | | USD | | | | 260,704 | | | | 12/16/10 | | | | $23,381 | |
| EUR | | | 654,985 | | | Credit Suisse | | | USD | | | | 888,446 | | | | 12/15/10 | | | | 39,812 | |
| EUR | | | 745,385 | | | Credit Suisse | | | USD | | | | 904,428 | | | | 12/16/10 | | | | 303,009 | |
| USD | | | 239,732 | | | Credit Suisse | | | CZK | | | | 5,030,063 | | | | 12/16/10 | | | | (44,353 | ) |
| USD | | | 993,041 | | | Credit Suisse | | | EUR | | | | 830,212 | | | | 12/16/10 | | | | (367,476 | ) |
| USD | | | 1,688,628 | | | Credit Suisse | | | EUR | | | | 1,293,615 | | | | 12/15/10 | | | | (110,915 | ) |
| Net unrealized depreciation | | | | $(156,542) | |
|
| CZK—Czech Republic Koruna | |
| EUR—Euro Dollar | |
| USD—United States Dollar | |
| | | | | | | | |
| Industry allocation (unaudited) | | | | | | |
| Industry | | Value | | | Percent of
net assets | |
| Banks | | | $11,418,575 | | | | 13.6% | |
| Mining | | | 10,204,959 | | | | 12.1% | |
| Food | | | 7,614,811 | | | | 9.1% | |
| Auto manufacturers | | | 5,253,908 | | | | 6.2% | |
| Equity fund | | | 4,299,843 | | | | 5.1% | |
| Engineering & construction | | | 3,827,216 | | | | 4.6% | |
| Pharmaceuticals | | | 3,356,121 | | | | 4.0% | |
| Retail | | | 3,282,464 | | | | 3.9% | |
| Real estate | | | 3,080,759 | | | | 3.7% | |
| Beverages | | | 2,521,570 | | | | 3.0% | |
| Holding companies-divers | | | 2,378,633 | | | | 2.8% | |
| Healthcare products | | | 2,206,549 | | | | 2.6% | |
| Telecommunications | | | 2,202,986 | | | | 2.6% | |
| Oil & gas | | | 2,158,693 | | | | 2.6% | |
| Computers | | | 1,714,625 | | | | 2.0% | |
| Distribution/wholesale | | | 1,337,661 | | | | 1.6% | |
| Machinery-diversified | | | 1,285,464 | | | | 1.5% | |
| Cosmetics/personal care | | | 1,211,068 | | | | 1.4% | |
| Electrical components & equipment | | | 1,056,225 | | | | 1.3% | |
| Internet | | | 1,055,726 | | | | 1.3% | |
| Agriculture | | | 1,017,511 | | | | 1.2% | |
| Household products/wares | | | 946,006 | | | | 1.1% | |
| Insurance | | | 928,771 | | | | 1.1% | |
| Machinery-construction & mining | | | 922,408 | | | | 1.1% | |
| Building materials | | | 852,647 | | | | 1.0% | |
| Auto parts & equipment | | | 693,089 | | | | 0.8% | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 25 | |
Investment Portfolios
| | | | | | | | |
| EAGLE INTERNATIONAL EQUITY FUND (cont’d) | | | | |
| | |
| Industry allocation (unaudited) (cont’d) | | | | | | |
| Industry | | Value | | | Percent of
net assets | |
| Forest products & paper | | | $668,783 | | | | 0.8% | |
| Transportation | | | 665,078 | | | | 0.8% | |
| Chemicals | | | 604,285 | | | | 0.7% | |
| Electric | | | 555,205 | | | | 0.7% | |
| Lodging | | | 540,526 | | | | 0.6% | |
| Aerospace/defense | | | 538,172 | | | | 0.6% | |
| Office/business equipment | | | 495,905 | | | | 0.6% | |
| Healthcare services | | | 482,326 | | | | 0.6% | |
| Diversified financial services | | | 478,397 | | | | 0.6% | |
| Food service | | | 424,472 | | | | 0.5% | |
| Semiconductors | | | 408,824 | | | | 0.5% | |
| Media | | | 376,009 | | | | 0.4% | |
| Oil & gas services | | | 288,376 | | | | 0.4% | |
| Miscellaneous manufacturer | | | 214,198 | | | | 0.3% | |
| Hand/machine tools | | | 212,855 | | | | 0.3% | |
| Electronics | | | 198,309 | | | | 0.2% | |
| Commercial services | | | 175,718 | | | | 0.2% | |
| Software | | | 95,551 | | | | 0.1% | |
| Apparel | | | 89,216 | | | | 0.1% | |
| Biotechnology | | | 69,525 | | | | 0.1% | |
| Airlines | | | 65,112 | | | | 0.1% | |
| Total investment portfolio | | | $84,475,130 | | | | 100.5% | |
| | | | | | | | | | | | |
| | | | |
| EAGLE INVESTMENT GRADE BOND FUND | | | | | | | | | |
| Corporate bonds—34.2% | | | | | Principal
amount
(in thousands) | | | Value | |
| Advertising—0.3% | | | | | | | | | | | | |
| Omnicom Group, Inc., 4.45%, 08/15/20 | | | | | | | 250 | | | | $256,773 | |
| | | |
| Aerospace/defense—1.6% | | | | | | | | | | | | |
| L-3 Communications Corporation, 4.75%, 07/15/20 | | | | | | | 250 | | | | 260,970 | |
| Raytheon Company, 1.63%, 10/15/15 | | | | | | | 500 | | | | 498,027 | |
| United Technologies Corporation, 5.38%, 12/15/17 | | | | | | | 775 | | | | 906,725 | |
| | | |
| Banks—0.8% | | | | | | | | | | | | |
| Bank of Montreal, 2.13%, 06/28/13 | | | | | | | 250 | | | | 258,456 | |
| The Goldman Sachs Group, Inc., 6.00%, 05/01/14 | | | | | | | 500 | | | | 561,698 | |
| | | |
| Beverages—3.3% | | | | | | | | | | | | |
Anheuser-Busch InBev Worldwide, Inc., FRN,
1.02%, 03/26/13 | | | | | | | 1,500 | | | | 1,512,864 | |
| The Coca-Cola Company, 5.35%, 11/15/17 | | | | | | | 770 | | | | 904,103 | |
| PepsiCo, Inc., 7.90%, 11/01/18 | | | | | | | 700 | | | | 938,565 | |
| | | |
| Biotechnology—1.6% | | | | | | | | | | | | |
| Amgen, Inc., 5.70%, 02/01/19 | | | | | | | 250 | | | | 296,957 | |
| Celgene Corporation, 2.45%, 10/15/15 | | | | | | | 750 | | | | 753,826 | |
| Genzyme Corporation, 3.63%, 06/15/15 | | | | | | | 500 | | | | 532,239 | |
| | | | | | | | | | | | |
| | | | | | | | | | |
| Corporate bonds—34.2% | | | | | Principal
amount
(in thousands) | | | Value | |
| Computers—2.7% | | | | | | | | | | | | |
| Hewlett-Packard Company, FRN, 0.42%, 09/13/12 | | | | | | | 2,000 | | | | $2,002,060 | |
International Business Machines Corporation,
1.00%, 08/05/13 | | | | | | | 750 | | | | 754,414 | |
| | | |
| Cosmetics/personal care—0.2% | | | | | | | | | | | | |
| Colgate-Palmolive Company, 2.95%, 11/01/20 | | | | | | | 250 | | | | 245,825 | |
| | | |
| Diversified financial services—1.7% | | | | | | | | | | | | |
| BlackRock, Inc., Series 2, 5.00%, 12/10/19 | | | | | | | 750 | | | | 821,153 | |
| CME Group, Inc., 5.40%, 08/01/13 | | | | | | | 850 | | | | 950,598 | |
| | | |
| Electric—2.5% | | | | | | | | | | | | |
| Carolina Power & Light Company, 5.25%, 12/15/15 | | | | | | | 300 | | | | 350,338 | |
| Exelon Generation Company LLC, 5.20%, 10/01/19 | | | | | | | 495 | | | | 546,402 | |
| FPL Group Capital, Inc., 2.55%, 11/15/13 | | | | | | | 750 | | | | 773,197 | |
| PSEG Power LLC, 2.50%, 04/15/13 | | | | | | | 250 | | | | 258,111 | |
| Virginia Electric and Power Company, 5.40%, 01/15/16 | | | | | | | 500 | | | | 587,544 | |
| | | |
| Food—1.2% | | | | | | | | | | | | |
| General Mills, Inc., 5.65%, 02/15/19 | | | | | | | 800 | | | | 933,981 | |
| Sara Lee Corporation, 2.75%, 09/15/15 | | | | | | | 250 | | | | 251,439 | |
| | | |
| Gas—0.7% | | | | | | | | | | | | |
| Sempra Energy, 9.80%, 02/15/19 | | | | | | | 550 | | | | 765,227 | |
| | | |
| Healthcare products—1.6% | | | | | | | | | | | | |
| Baxter International, Inc., 5.38%, 06/01/18 | | | | | | | 750 | | | | 874,883 | |
| Covidien International Finance SA, 2.80%, 06/15/15 | | | | | | | 725 | | | | 754,289 | |
| | | |
| Insurance—2.0% | | | | | | | | | | | | |
| AON Corporation, 3.50%, 09/30/15 | | | | | | | 500 | | | | 516,020 | |
| Berkshire Hathaway, Inc., FRN, 0.83%, 02/11/13 | | | | | | | 1,500 | | | | 1,507,440 | |
| | | |
| Internet—1.0% | | | | | | | | | | | | |
| eBay, Inc., 1.63%, 10/15/15 | | | | | | | 500 | | | | 497,521 | |
| Symantec Corporation, 2.75%, 09/15/15 | | | | | | | 500 | | | | 507,524 | |
| | | |
| Mining—0.7% | | | | | | | | | | | | |
| Newmont Mining Corporation, 5.13%, 10/01/19 | | | | | | | 430 | | | | 487,661 | |
| Rio Tinto Finance USA Ltd., 1.88%, 11/02/15 | | | | | | | 250 | | | | 250,312 | |
| | | |
| Miscellaneous manufacturing—0.2% | | | | | | | | | | | | |
| ITT Corporation, 6.13%, 05/01/19 | | | | | | | 205 | | | | 239,975 | |
| | | |
| Oil & gas—2.9% | | | | | | | | | | | | |
| Noble Holding International Ltd., 3.45%, 08/01/15 | | | | | | | 250 | | | | 264,904 | |
| Shell International Finance BV, FRN, 0.64%, 06/22/12 | | | | | | | 1,500 | | | | 1,503,714 | |
| XTO Energy, Inc., 5.75%, 12/15/13 | | | | | | | 1,000 | | | | 1,151,578 | |
| | | |
| Pharmaceuticals—1.9% | | | | | | | | | | | | |
| Allergan, Inc./United States, 3.38%, 09/15/20 | | | | | | | 750 | | | | 746,551 | |
| McKesson Corporation, 5.70%, 03/01/17 | | | | | | | 500 | | | | 572,658 | |
| Teva Pharmaceutical Finance II BV/Teva Pharmaceutical Finance III LLC, 3.00%, 06/15/15 | | | | | | | 600 | | | | 629,792 | |
| | | |
| Retail—2.3% | | | | | | | | | | | | |
| McDonald’s Corporation, 5.80%, 10/15/17 | | | | | | | 750 | | | | 896,123 | |
| Staples, Inc., 9.75%, 01/15/14 | | | | | | | 510 | | | | 631,719 | |
Wal-Mart Stores, Inc. Pass Through Trusts, Series C,
8.88%, 06/29/11 | | | | | | | 28 | | | | 28,137 | |
| Wal-Mart Stores, Inc., 3.63%, 07/08/20 | | | | | | | 750 | | | | 766,380 | |
| | | |
| Software—1.5% | | | | | | | | | | | | |
| Adobe Systems, Inc., 3.25%, 02/01/15 | | | | | | | 500 | | | | 525,302 | �� |
| Fiserv, Inc., 3.13%, 10/01/15 | | | | | | | 250 | | | | 257,174 | |
| Oracle Corporation, 144A, 3.88%, 07/15/20 | | | | | | | 750 | | | | 781,721 | |
| | |
| 26 | | The accompanying notes are an integral part of the financial statements. |
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE INVESTMENT GRADE BOND FUND (cont’d) | | | | |
| Corporate bonds—34.2% | | | | | Principal
amount
(in thousands) | | | Value | |
| Telecommunications—1.7% | | | | | | | | | | | | |
| AT&T Corporation, 7.30%, 11/15/11 | | | | | | | 751 | | | | $801,633 | |
| Verizon Communications, Inc., 6.35%, 04/01/19 | | | | | | | 750 | | | | 920,254 | |
| | | |
| Toys/games/hobbies—0.2% | | | | | | | | | | | | |
| Mattel, Inc., 4.35%, 10/01/20 | | | | | | | 250 | | | | 250,189 | |
| | | |
| Transportation—1.6% | | | | | | | | | | | | |
| Norfolk Southern Corporation, 5.90%, 06/15/19 | | | | | | | 600 | | | | 708,069 | |
| Union Pacific Corporation, 5.70%, 08/15/18 | | | | | | | 750 | | | | 872,046 | |
| Total corporate bonds (cost $33,973,801) | | | | | | | | 34,865,061 | |
| | | |
| U.S. Treasuries—32.6% | | | | | | | | | | | | |
| U.S. Treasury Note, 4.25%, 11/15/14 | | | | | | | 3,250 | | | | 3,691,798 | |
| U.S. Treasury Note, 4.50%, 02/15/16 | | | | | | | 2,500 | | | | 2,913,280 | |
| U.S. Treasury Note, 4.75%, 08/15/17 | | | | | | | 4,000 | | | | 4,744,064 | |
| U.S. Treasury Note, 3.50%, 05/15/20 | | | | | | | 750 | | | | 808,890 | |
| U.S. Treasury Note, 2.13%, 05/31/15 | | | | | | | 7,000 | | | | 7,336,350 | |
| U.S. Treasury Note, 1.00%, 07/15/13 | | | | | | | 1,500 | | | | 1,522,260 | |
| U.S. Treasury Note, 2.38%, 07/31/17 | | | | | | | 1,500 | | | | 1,551,563 | |
| U.S. Treasury Note, 0.75%, 08/15/13 | | | | | | | 5,500 | | | | 5,544,688 | |
| U.S. Treasury Note, 1.25%, 08/31/15 | | | | | | | 5,000 | | | | 5,029,295 | |
| Total U.S. Treasuries (cost $32,109,819) | | | | | | | | 33,142,188 | |
| | | |
| Mortgage-backed obligations—12.3% | | | | | | | | | | | | |
| Commercial mortgage-backed obligations—2.5% | | | | | | | | | | | | |
| Credit Suisse First Boston Mortgage Securities Corporation, FRN, Series 2005-C5, Class A3, 5.10%, 08/15/38 | | | | | | | 379 | | | | 396,687 | |
| JP Morgan Chase Commercial Mortgage Securities Corporation, Series 2002-C3, Class A2, 4.99%, 07/12/35 | | | | | | | 275 | | | | 293,152 | |
JP Morgan Chase Commercial Mortgage Securities Corporation, FRN, Series 2003-PM1A, Class A4,
5.33%, 08/12/40 | | | | | | | 230 | | | | 249,736 | |
| LB-UBS Commercial Mortgage Trust, Series 2001-C7, Class A5, 6.13%, 12/15/30 | | | | | | | 500 | | | | 519,052 | |
| LB-UBS Commercial Mortgage Trust, FRN, Series 2003-C7, Class A2, 4.06%, 09/15/27 | | | | | | | 40 | | | | 40,117 | |
| Merrill Lynch Mortgage Investors, Inc., FRN, Series 1998-C1, Class A3, 6.72%, 11/15/26 | | | | | | | 36 | | | | 40,133 | |
| Morgan Stanley Capital I, Series 2003-T11, Class A4, 5.15%, 06/13/41 | | | | | | | 385 | | | | 416,187 | |
| Wachovia Bank Commercial Mortgage Trust, FRN, Series 2003-C6, Class A3, 4.96%, 08/15/35 | | | | | | | 571 | | | | 576,168 | |
| |
| Covered bonds—5.0% | | | | | |
| Bank of Nova Scotia, 144A, 1.45%, 07/26/13 | | | | | | | 1,000 | | | | 1,014,717 | |
| DnB NOR Boligkreditt, 144A, 2.10%, 10/14/15 | | | | | | | 1,000 | | | | 1,001,554 | |
| Sparebanken1 Boligkreditt, 144A, 1.25%, 10/25/13 | | | | | | | 1,000 | | | | 1,002,831 | |
| Stadshypotek AB, 144A, 1.45%, 09/30/13 | | | | | | | 1,000 | | | | 1,011,627 | |
| The Toronto-Dominion Bank, 144A, 2.20% 07/29/15 | | | | | | | 1,000 | | | | 1,017,988 | |
| |
| Federal agency mortgage-backed obligations—4.8% | | | | | |
| Freddie Mac REMICs, Series 2628, Class AB, 4.50%, 06/15/18 | | | | | | | 365 | | | | 386,724 | |
| Freddie Mac REMICs, Series 2885, Class LC, 4.50%, 04/15/34 | | | | | | | 568 | | | | 605,674 | |
| Fannie Mae REMICs, Series 2006-B1, Class AB, 6.00%, 06/25/16 | | | | | | | 157 | | | | 162,052 | |
| | | | | | | | | | | | |
| EAGLE INVESTMENT GRADE BOND FUND | | | | |
| Mortgage-backed obligations—12.3% | | | | | Principal
amount
(in thousands) | | | Value | |
| Federal agency mortgage-backed obligations (cont’d) | | | | | |
| Fannie Mae REMICs, Series 2006-63, Class AB, 6.50%, 10/25/33 | | | | | | | 194 | | | | $197,436 | |
Freddie Mac REMICs, Series R005, Class AB,
5.50%, 12/15/18 | | | | | | | 137 | | | | 141,260 | |
Freddie Mac REMICs, Series 3114, Class GC,
5.00%, 01/15/34 | | | | | | | 491 | | | | 509,066 | |
| Freddie Mac REMICs, Series R006, Class AK, 5.75%, 12/15/18 | | | | | | | 343 | | | | 352,102 | |
| Fannie Mae REMICs, Series 2007-11, Class AB, 5.69%, 01/25/32 | | | | | | | 519 | | | | 542,489 | |
| Fannie Mae REMICs, Series 2007-26, Class JA, 5.00%, 05/25/29 | | | | | | | 125 | | | | 125,896 | |
| Fannie Mae REMICs, Series 2007-118, Class AB, 5.00%, 04/25/35 | | | | | | | 673 | | | | 700,260 | |
| Freddie Mac REMICs, Series 3456, Class CG, 5.00%, 01/15/35 | | | | | | | 544 | | | | 564,249 | |
| Ginnie Mae REMICs, Series 2004-86, Class PK, 4.00%, 09/20/34 | | | | | | | 586 | | | | 629,521 | |
| Total mortgage-backed obligations (cost $12,377,837) | | | | 12,496,678 | |
| | | |
| U.S. Government agency securities—11.1% | | | | | | | | | | | | |
| Fixed rate U.S. Government agency securities—2.2% | | | | | | | | | | | | |
| Private Export Funding Corporation, 2.25%, 12/15/17 | | | | | | | 1,000 | | | | 994,214 | |
| Tennessee Valley Authority, 5.5%, 7/18/17 | | | | | | | 1,000 | | | | 1,212,933 | |
| | | |
| Government-backed corporate bond—8.9% | | | | | | | | | | | | |
| Citibank NA, FDIC, 1.75%, 12/28/12 | | | | | | | 1,750 | | | | 1,796,652 | |
| John Deere Capital Corporation, FDIC, 2.88%, 06/19/12 | | | | | | | 2,000 | | | | 2,080,242 | |
| General Electric Capital Corporation, FDIC, 3.00%, 12/09/11 | | | | | | | 2,000 | | | | 2,058,118 | |
| The Goldman Sachs Group, Inc., FDIC, 3.25%, 06/15/12 | | | | | | | 2,000 | | | | 2,092,152 | |
JPMorgan Chase & Company, FDIC,
3.13%, 12/01/11 | | | | | | | 1,000 | | | | 1,029,581 | |
| Total U.S. Government agency securities (cost $11,162,227) | | | | 11,263,892 | |
| | | |
| Foreign government securities—3.4% | | | | | | | | | | | | |
| Egypt Government AID Bonds, 4.45%, 09/15/15 | | | | | | | 1,000 | | | | 1,142,990 | |
| Kreditanstalt fuer Wiederaufbau, 2.75%, 09/08/20 | | | | | | | 1,000 | | | | 993,657 | |
| Landwirtschaftliche Rentenbank, 2.38%, 09/13/17 | | | | | | | 250 | | | | 251,814 | |
| Province of Ontario, Canada, 2.70%, 06/16/15 | | | | | | | 1,000 | | | | 1,051,432 | |
| Total foreign government securities (cost $3,388,619) | | | | 3,439,893 | |
| | | |
| Supranational—3.4% | | | | | | | | | | | | |
| Asian Development Bank, 1.63%, 07/15/13 | | | | | | | 250 | | | | 256,492 | |
| Inter-American Development Bank, 2.25%, 07/15/15 | | | | | | | 1,000 | | | | 1,046,586 | |
| International Bank for Reconstruction & Development, 2.38%, 05/26/15 | | | | | | | 1,000 | | | | 1,055,275 | |
| Nordic Investment Bank, 2.50%, 07/15/15 | | | | | | | 1,000 | | | | 1,050,696 | |
| Total supranational (cost $3,265,605) | | | | | | | | | | | 3,409,049 | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 27 | |
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE INVESTMENT GRADE BOND FUND (cont’d) | | | | |
| Short term investments—2.4% | | | | | Principal
amount
(in thousands) | | | Value | |
JP Morgan Commercial Paper Sweep, 0.15%
(cost $2,440,122) | | | | $2,440 | | | | $2,440,122 | |
| |
| Total investment portfolio (cost $98,718,030) 99.4% | | | | 101,056,883 | |
| | | |
| Other assets in excess of liabilities 0.6% | | | | | | | | | | | 649,612 | |
| | | |
| Net assets 100.0% | | | | | | | | | | | $101,706,495 | |
| |
144A—144A securities are issued pursuant to Rule 144A of the Securities Act of 1933. Most of these are deemed to be liquid for purposes of compliance limitations on holdings of illiquid securities and all may be resold as transactions exempt from registration to qualified institutional buyers. At October 31, 2010, these securities aggregated $5,830,438 or 5.7% of the net assets of the Fund. FDIC—Federal deposit insurance corporation REMIC—Real estate mortgage investment conduit FRN—Floating rate notes reset their interest rates on a semiannual or quarterly basis. | | | | | |
| | | | |
| |
| Standard & Poor’s bond ratings (unaudited) | | | |
| Bond rating | | Percent of net assets | |
| AAA | | | 56.3% | |
| AA | | | 5.7% | |
| A | | | 16.9% | |
| BBB | | | 11.1% | |
| Not rated | | | 9.4% | |
| | | | | | | | | | | | |
| | | | |
| EAGLE LARGE CAP CORE FUND | | | | | | | | | |
| Common stocks—87.4% | | | | | Shares | | | Value | |
| Advertising—2.2% | | | | | | | | | | | | |
| Omnicom Group, Inc. | | | | | | | 69,035 | | | | $3,034,779 | |
| | | |
| Aerospace/defense—3.3% | | | | | | | | | | | | |
| The Boeing Company | | | | | | | 30,420 | | | | 2,148,869 | |
| United Technologies Corporation | | | | | | | 31,980 | | | | 2,391,145 | |
| | | |
| Banks—8.6% | | | | | | | | | | | | |
| JPMorgan Chase & Company | | | | | | | 101,950 | | | | 3,836,379 | |
| The Goldman Sachs Group, Inc. | | | | | | | 19,546 | | | | 3,145,929 | |
| Wells Fargo & Company | | | | | | | 185,270 | | | | 4,831,842 | |
| | | |
| Beverages—4.0% | | | | | | | | | | | | |
| PepsiCo, Inc. | | | | | | | 41,015 | | | | 2,678,279 | |
| The Coca-Cola Company | | | | | | | 45,825 | | | | 2,809,989 | |
| | | |
| Computers—5.5% | | | | | | | | | | | | |
| Apple, Inc.* | | | | | | | 13,951 | | | | 4,197,437 | |
| EMC Corporation* | | | | | | | 156,260 | | | | 3,283,023 | |
| | | |
| Healthcare products—7.0% | | | | | | | | | | | | |
| Johnson & Johnson | | | | | | | 42,920 | | | | 2,732,716 | |
| St. Jude Medical, Inc.* | | | | | | | 120,925 | | | | 4,631,427 | |
| Zimmer Holdings, Inc.* | | | | | | | 46,950 | | | | 2,227,308 | |
| | | |
| Healthcare services—2.5% | | | | | | | | | | | | |
| UnitedHealth Group, Inc. | | | | | | | 96,400 | | | | 3,475,220 | |
| | | | | | | | | | | | |
| | | | | | | | | | |
| | | |
| Common stocks—87.4% | | | | | Shares | | | Value | |
| Insurance—3.0% | | | | | | | | | | | | |
| MetLife, Inc. | | | | | | | 103,460 | | | | $4,172,542 | |
| | | |
| Internet—2.4% | | | | | | | | | | | | |
| Google, Inc., Class A* | | | | | | | 5,302 | | | | 3,250,073 | |
| | | |
| Miscellaneous manufacturing—3.6% | | | | | | | | | | | | |
| Tyco International Ltd. | | | | | | | 127,636 | | | | 4,885,906 | |
| | | |
| Oil & gas—9.0% | | | | | | | | | | | | |
| ConocoPhillips | | | | | | | 77,420 | | | | 4,598,748 | |
| EOG Resources, Inc. | | | | | | | 34,955 | | | | 3,345,893 | |
| Exxon Mobil Corporation | | | | | | | 65,805 | | | | 4,374,058 | |
| | | |
| Oil & gas services—2.5% | | | | | | | | | | | | |
| Schlumberger Ltd. | | | | | | | 48,535 | | | | 3,392,111 | |
| | | |
| Pharmaceuticals—3.1% | | | | | | | | | | | | |
| Pfizer, Inc. | | | | | | | 247,345 | | | | 4,303,803 | |
| | | |
| REITs—1.9% | | | | | | | | | | | | |
| Annaly Capital Management, Inc. | | | | | | | 144,495 | | | | 2,559,006 | |
| | | |
| Retail—8.7% | | | | | | | | | | | | |
| Bed Bath & Beyond, Inc.* | | | | | | | 64,080 | | | | 2,813,112 | |
| Lowe’s Companies, Inc. | | | | | | | 125,560 | | | | 2,678,195 | |
| Staples, Inc. | | | | | | | 179,335 | | | | 3,670,987 | |
| Wal-Mart Stores, Inc. | | | | | | | 49,200 | | | | 2,665,164 | |
| | | |
| Semiconductors—2.5% | | | | | | | | | | | | |
| Intel Corporation | | | | | | | 172,200 | | | | 3,456,054 | |
| | | |
| Software—8.6% | | | | | | | | | | | | |
| Activision Blizzard, Inc. | | | | | | | 234,565 | | | | 2,690,461 | |
| Adobe Systems, Inc.* | | | | | | | 118,555 | | | | 3,337,323 | |
| Microsoft Corporation | | | | | | | 213,995 | | | | 5,700,827 | |
| | | |
| Telecommunications—6.5% | | | | | | | | | | | | |
| Cisco Systems, Inc.* | | | | | | | 144,705 | | | | 3,303,615 | |
| QUALCOMM, Inc. | | | | | | | 68,685 | | | | 3,099,754 | |
| Sprint Nextel Corporation* | | | | | | | 601,865 | | | | 2,479,684 | |
| | | |
| Transportation—2.5% | | | | | | | | | | | | |
| Union Pacific Corporation | | | | | | | 39,480 | | | | 3,461,606 | |
| Total common stocks (cost $108,294,722) | | | | | | | | | | | 119,663,264 | |
| | | |
| Investment companies—3.0% | | | | | | | | | | | | |
| Materials Select Sector SPDR ETF | | | | | | | 119,310 | | | | 4,155,567 | |
| Total investment companies (cost $3,976,137) | | | | | | | | | | | 4,155,567 | |
| | | |
| Short term investments—9.2% | | | | | |
| Principal
amount |
| | | Value | |
| Federal Home Loan Bank, 0.09%, 11/01/10 | | | | | | | $11,000,000 | | | | 11,000,000 | |
| JP Morgan Commercial Paper Sweep 0.15% | | | | | | | 1,702,060 | | | | 1,702,060 | |
Total short term investments
(cost $12,702,060) | | | | | | | | | | | 12,702,060 | |
| | | |
| Total investment portfolio (cost $124,972,919) 99.6% | | | | | | | | | | | 136,520,891 | |
| | | |
| Other assets in excess of liabilities 0.4% | | | | | | | | | | | 529,104 | |
| | | |
| Net assets 100.0% | | | | | | | | | | | $137,049,995 | |
| | | |
| * Non-income producing security | | | | | | | | | | | | |
| | | |
ETF—Exchange-traded fund SPDR—Standard & Poor’s depository receipt REIT—Real estate investment trust | | | | | | | | | | | | |
| | |
| 28 | | The accompanying notes are an integral part of the financial statements. |
Investment Portfolios
| | | | | | |
| EAGLE LARGE CAP CORE FUND (cont’d) | | | | | | |
| | | | |
| Sector allocation (unaudited) | | | |
| Sector | | Percent of net assets | |
| Financial | | | 17.7% | |
| Consumer, non-cyclical | | | 16.7% | |
| Technology | | | 16.6% | |
| Energy | | | 11.5% | |
| Communications | | | 11.1% | |
| Industrial | | | 9.4% | |
| Consumer, cyclical | | | 8.6% | |
| Government | | | 8.0% | |
| | | | | | | | | | | | |
| EAGLE MID CAP GROWTH FUND | | | | | | | | | |
| Common stocks—100.0% | | | | | Shares | | | Value | |
| Aerospace/defense—2.9% | | | | | | | | | | | | |
| BE Aerospace, Inc.* | | | | | | | 63,310 | | | | $2,327,276 | |
| Goodrich Corporation | | | | | | | 46,125 | | | | 3,785,479 | |
| | | |
| Apparel—3.5% | | | | | | | | | | | | |
| Coach, Inc. | | | | | | | 108,015 | | | | 5,400,750 | |
| Deckers Outdoor Corporation* | | | | | | | 38,815 | | | | 2,255,151 | |
| | | |
| Auto manufacturers—0.9% | | | | | | | | | | | | |
| Navistar International Corporation* | | | | | | | 42,005 | | | | 2,023,801 | |
| | | |
| Biotechnology—1.0% | | | | | | | | | | | | |
| Illumina, Inc.* | | | | | | | 40,180 | | | | 2,182,176 | |
| | | |
| Chemicals—4.7% | | | | | | | | | | | | |
| CF Industries Holdings, Inc. | | | | | | | 52,530 | | | | 6,436,501 | |
| Huntsman Corporation | | | | | | | 260,181 | | | | 3,603,507 | |
| | | |
| Coal—2.0% | | | | | | | | | | | | |
| Arch Coal, Inc. | | | | | | | 73,390 | | | | 1,804,660 | |
| Walter Energy, Inc. | | | | | | | 28,510 | | | | 2,507,740 | |
| | | |
| Commercial services—1.1% | | | | | | | | | | | | |
| Sotheby’s | | | | | | | 55,985 | | | | 2,454,382 | |
| | | |
| Computers—5.2% | | | | | | | | | | | | |
| NetApp, Inc.* | | | | | | | 96,325 | | | | 5,129,306 | |
| Riverbed Technology, Inc.* | | | | | | | 49,650 | | | | 2,856,861 | |
| SanDisk Corporation* | | | | | | | 86,375 | | | | 3,245,973 | |
| | | |
| Cosmetics/personal care—1.3% | | | | | | | | | | | | |
| Avon Products, Inc. | | | | | | | 90,835 | | | | 2,765,926 | |
| | | |
| Diversified financial services—5.6% | | | | | | | | | | | | |
| Ameriprise Financial, Inc. | | | | | | | 96,870 | | | | 5,007,210 | |
| CME Group, Inc. | | | | | | | 6,310 | | | | 1,827,691 | |
| Legg Mason, Inc. | | | | | | | 66,240 | | | | 2,055,427 | |
| TD Ameritrade Holding Corporation* | | | | | | | 174,841 | | | | 2,988,033 | |
| | | |
| Electronics—3.3% | | | | | | | | | | | | |
| Dolby Laboratories, Inc., Class A* | | | | | | | 52,583 | | | | 3,243,319 | |
| Gentex Corporation | | | | | | | 196,033 | | | | 3,916,739 | |
| | | |
| Entertainment—1.9% | | | | | | | | | | | | |
| Bally Technologies, Inc.* | | | | | | | 112,869 | | | | 4,072,314 | |
| | | |
| Environmental control—2.5% | | | | | | | | | | | | |
| Republic Services, Inc. | | | | | | | 80,915 | | | | 2,412,076 | |
| Waste Connections, Inc. | | | | | | | 72,210 | | | | 2,941,835 | |
| | | | | | | | | | | | |
| | | | | | | | | | |
| Common stocks—100.0% | | | | | Shares | | | Value | |
| Food—1.0% | | | | | | | | | | | | |
| Dean Foods Company* | | | | | | | 198,998 | | | | $2,069,579 | |
| | | |
| Healthcare products—2.8% | | | | | | | | | | | | |
| Intuitive Surgical, Inc.* | | | | | | | 7,635 | | | | 2,007,623 | |
| Patterson Companies, Inc. | | | | | | | 75,370 | | | | 2,083,981 | |
| Thoratec Corporation* | | | | | | | 61,005 | | | | 1,991,203 | |
| | | |
| Household products/wares—1.3% | | | | | | | | | | | | |
| Church & Dwight Company, Inc. | | | | | | | 43,115 | | | | 2,839,123 | |
| | | |
| Insurance—1.2% | | | | | | | | | | | | |
| RenaissanceRe Holdings Ltd. | | | | | | | 40,995 | | | | 2,470,359 | |
| | | |
| Internet—3.6% | | | | | | | | | | | | |
| Akamai Technologies, Inc.* | | | | | | | 36,780 | | | | 1,900,423 | |
| NetFlix, Inc.* | | | | | | | 14,620 | | | | 2,536,570 | |
| priceline.com, Inc.* | | | | | | | 8,705 | | | | 3,280,131 | |
| | | |
| Leisure time—1.8% | | | | | | | | | | | | |
| Carnival Corporation | | | | | | | 89,970 | | | | 3,884,005 | |
| | | |
| Lodging—3.1% | | | | | | | | | | | | |
| Las Vegas Sands Corporation* | | | | | | | 142,810 | | | | 6,552,123 | |
| | | |
| Machinery, diversified—4.0% | | | | | | | | | | | | |
| AGCO Corporation* | | | | | | | 104,415 | | | | 4,434,505 | |
| Cummins, Inc. | | | | | | | 45,880 | | | | 4,042,028 | |
| | | |
| Metal fabricate/hardware—1.0% | | | | | | | | | | | | |
| Precision Castparts Corporation | | | | | | | 15,355 | | | | 2,097,186 | |
| | | |
| Mining—3.0% | | | | | | | | | | | | |
| Freeport-McMoRan Copper & Gold, Inc. | | | | | | | 45,805 | | | | 4,336,817 | |
| Titanium Metals Corporation* | | | | | | | 107,865 | | | | 2,120,626 | |
| | | |
| Oil & gas—4.6% | | | | | | | | | | | | |
| Continental Resources, Inc.* | | | | | | | 76,880 | | | | 3,654,106 | |
| McMoRan Exploration Company* | | | | | | | 108,110 | | | | 1,820,572 | |
| Pioneer Natural Resources Company | | | | | | | 29,305 | | | | 2,045,489 | |
| Whiting Petroleum Corporation* | | | | | | | 22,965 | | | | 2,306,605 | |
| | | |
| Oil & gas services—1.0% | | | | | | | | | | | | |
| National Oilwell Varco, Inc. | | | | | | | 39,295 | | | | 2,112,499 | |
| | | |
| Pharmaceuticals—5.6% | | | | | | | | | | | | |
| AmerisourceBergen Corporation | | | | | | | 127,930 | | | | 4,198,663 | |
| Express Scripts, Inc.* | | | | | | | 42,895 | | | | 2,081,265 | |
| Mylan, Inc.* | | | | | | | 274,085 | | | | 5,569,407 | |
| | | |
| Retail—4.5% | | | | | | | | | | | | |
| CarMax, Inc.* | | | | | | | 76,180 | | | | 2,360,818 | |
| Chico’s FAS, Inc. | | | | | | | 313,215 | | | | 3,044,450 | |
| Chipotle Mexican Grill, Inc.* | | | | | | | 10,630 | | | | 2,234,532 | |
| Limited Brands, Inc. | | | | | | | 73,145 | | | | 2,149,732 | |
| | | |
| Semiconductors—6.9% | | | | | | | | | | | | |
| ARM Holdings PLC, Sponsored ADR | | | | | | | 257,795 | | | | 4,557,816 | |
| Cree, Inc.* | | | | | | | 24,966 | | | | 1,280,506 | |
| Linear Technology Corporation | | | | | | | 68,455 | | | | 2,206,305 | |
| Rovi Corporation* | | | | | | | 134,060 | | | | 6,790,139 | |
| | | |
| Software—10.9% | | | | | | | | | | | | |
| Adobe Systems, Inc.* | | | | | | | 72,390 | | | | 2,037,779 | |
| ANSYS, Inc.* | | | | | | | 99,530 | | | | 4,503,732 | |
| Autodesk, Inc.* | | | | | | | 134,805 | | | | 4,877,245 | |
| Cerner Corporation* | | | | | | | 48,875 | | | | 4,292,691 | |
| Citrix Systems, Inc.* | | | | | | | 56,925 | | | | 3,647,185 | |
| Concur Technologies, Inc.* | | | | | | | 23,795 | | | | 1,228,298 | |
| MSCI, Inc., Class A* | | | | | | | 78,650 | | | | 2,819,602 | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 29 | |
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE MID CAP GROWTH FUND (cont’d) | | | | | | | | | |
| Common stocks—100.0% | | | | | Shares | | | Value | |
| Telecommunications—4.5% | | | | | | | | | | | | |
| Amdocs Ltd.* | | | | | | | 69,533 | | | | $2,133,272 | |
| American Tower Corporation, Class A* | | | | | | | 96,275 | | | | 4,968,753 | |
| Polycom, Inc.* | | | | | | | 77,928 | | | | 2,632,408 | |
| | | |
| Transportation—3.3% | | | | | | | | | | | | |
| Kansas City Southern* | | | | | | | 127,540 | | | | 5,588,803 | |
| Landstar System, Inc. | | | | | | | 38,205 | | | | 1,437,272 | |
| Total common stocks (cost $160,787,341) | | | | | | | | | | | 214,470,359 | |
| |
| Total investment portfolio (cost $160,787,341) 100.0% | | | | 214,470,359 | |
| | | |
| Liabilities in excess of other assets (0.0)% (a) | | | | | | | | | | | (14,939 | ) |
| | | |
| Net assets 100.0% | | | | | | | | | | | $214,455,420 | |
| |
* Non-income producing security (a) Amount less than 0.1%. | | | | | |
| ADR—American depository receipt | | | | | |
| | | | |
| |
| Sector allocation (unaudited) | | | |
| Sector | | Percent of net assets | |
| Technology | | | 23.0% | |
| Industrial | | | 17.0% | |
| Consumer, cyclical | | | 15.7% | |
| Consumer, non-cyclical | | | 14.1% | |
| Communications | | | 8.1% | |
| Basic materials | | | 7.7% | |
| Energy | | | 7.6% | |
| Financial | | | 6.8% | |
| | | | | | | | | | | | |
| | | | |
| EAGLE MID CAP STOCK FUND | | | | | | | | | |
| Common stocks—99.2% | | | | | Shares | | | Value | |
| Aerospace/defense—1.5% | | | | | | | | | | | | |
| BE Aerospace, Inc.* | | | | | | | 574,500 | | | | $21,118,620 | |
| | | |
| Apparel—2.1% | | | | | | | | | | | | |
| VF Corporation | | | | | | | 358,125 | | | | 29,810,325 | |
| | | |
| Auto manufacturers—2.1% | | | | | | | | | | | | |
| Oshkosh Corporation* | | | | | | | 1,000,654 | | | | 29,529,300 | |
| | | |
| Banks—2.3% | | | | | | | | | | | | |
| CIT Group, Inc.* | | | | | | | 748,868 | | | | 32,448,450 | |
| | | |
| Biotechnology—1.2% | | | | | | | | | | | | |
| Life Technologies Corporation* | | | | | | | 345,401 | | | | 17,332,222 | |
| | | |
| Chemicals—6.7% | | | | | | | | | | | | |
| Air Products & Chemicals, Inc. | | | | | | | 192,784 | | | | 16,380,856 | |
| Albemarle Corporation | | | | | | | 659,906 | | | | 33,081,088 | |
| Sigma-Aldrich Corporation | | | | | | | 220,187 | | | | 13,964,260 | |
| Solutia, Inc.* | | | | | | | 1,611,488 | | | | 29,184,048 | |
| | | |
| Commercial services—1.0% | | | | | | | | | | | | |
| SEI Investments Company | | | | | | | 623,081 | | | | 13,801,244 | |
| | | | | | | | | | | | |
| | | |
| Common stocks—99.2% | | | | | Shares | | | Value | |
| Computers—2.5% | | | | | | | | | | | | |
| HIS, Inc., Class A* | | | | | | | 239,733 | | | | $17,318,312 | |
| Synopsys, Inc.* | | | | | | | 681,673 | | | | 17,437,195 | |
| | | |
| Distribution/wholesale—1.6% | | | | | | | | | | | | |
| Fossil, Inc.* | | | | | | | 372,842 | | | | 21,993,950 | |
| | | |
| Diversified financial services—6.0% | | | | | | | | | | | | |
| CME Group, Inc. | | | | | | | 102,273 | | | | 29,623,374 | |
| Discover Financial Services | | | | | | | 979,218 | | | | 17,283,198 | |
| IntercontinentalExchange, Inc.* | | | | | | | 119,480 | | | | 13,724,668 | |
| SLM Corporation* | | | | | | | 1,987,077 | | | | 23,646,216 | |
| | | |
| Electric—1.1% | | | | | | | | | | | | |
| ITC Holdings Corporation | | | | | | | 250,066 | | | | 15,656,632 | |
| | | |
| Electrical components & equipment—3.3% | | | | | | | | | | | | |
| AMETEK, Inc. | | | | | | | 348,221 | | | | 18,821,345 | |
| Energizer Holdings, Inc.* | | | | | | | 359,234 | | | | 26,863,519 | |
| | | |
| Electronics—7.6% | | | | | | | | | | | | |
| Agilent Technologies, Inc.* | | | | | | | 1,041,155 | | | | 36,232,194 | |
| Amphenol Corporation, Class A | | | | | | | 837,224 | | | | 41,970,039 | |
| Avnet, Inc.* | | | | | | | 477,990 | | | | 14,234,542 | |
| Dolby Laboratories, Inc., Class A* | | | | | | | 227,552 | | | | 14,035,407 | |
| | | |
| Entertainment—1.5% | | | | | | | | | | | | |
| DreamWorks Animation SKG, Inc., Class A* | | | | | | | 606,150 | | | | 21,397,095 | |
| | | |
| Environmental control—1.0% | | | | | | | | | | | | |
| Waste Connections, Inc. | | | | | | | 335,452 | | | | 13,666,314 | |
| | | |
| Food—0.9% | | | | | | | | | | | | |
| TreeHouse Foods, Inc.* | | | | | | | 252,435 | | | | 11,788,714 | |
| | | |
| Hand/machine tools—1.5% | | | | | | | | | | | | |
| Stanley Black & Decker, Inc. | | | | | | | 325,182 | | | | 20,151,529 | |
| | | |
| Healthcare products—4.9% | | | | | | | | | | | | |
| Hospira, Inc.* | | | | | | | 568,243 | | | | 33,799,094 | |
| St. Jude Medical, Inc.* | | | | | | | 899,921 | | | | 34,466,974 | |
| | | |
| Healthcare services—3.4% | | | | | | | | | | | | |
| Laboratory Corporation of America Holdings* | | | | | | | 257,297 | | | | 20,923,392 | |
| Mednax, Inc.* | | | | | | | 450,104 | | | | 26,650,658 | |
| | | |
| Insurance—6.2% | | | | | | | | | | | | |
| Allied World Assurance Company Holdings Ltd. | | | | | | | 648,424 | | | | 37,096,337 | |
| Assured Guaranty Ltd. | | | | | | | 817,595 | | | | 15,575,185 | |
| Reinsurance Group of America, Inc. | | | | | | | 351,182 | | | | 17,583,683 | |
| The Allstate Corporation | | | | | | | 511,895 | | | | 15,607,679 | |
| | | |
| Machinery-diversified—3.0% | | | | | | | | | | | | |
| AGCO Corporation* | | | | | | | 315,141 | | | | 13,384,038 | |
| Roper Industries, Inc. | | | | | | | 404,130 | | | | 28,058,746 | |
| | | |
| Media—2.5% | | | | | | | | | | | | |
| Grupo Televisa SA, Sponsored ADR | | | | | | | 195,842 | | | | 4,396,653 | |
| John Wiley & Sons, Inc., Class A | | | | | | | 691,680 | | | | 29,852,909 | |
| | | |
| Metal fabricate/hardware—2.6% | | | | | | | | | | | | |
| Precision Castparts Corporation | | | | | | | 264,765 | | | | 36,161,604 | |
| | | |
| Miscellaneous manufacturing—2.3% | | | | | | | | | | | | |
| Ingersoll-Rand PLC | | | | | | | 813,345 | | | | 31,972,592 | |
| | | |
| Oil & gas—5.2% | | | | | | | | | | | | |
| Helmerich & Payne, Inc. | | | | | | | 673,469 | | | | 28,811,004 | |
| Noble Energy, Inc. | | | | | | | 207,790 | | | | 16,930,729 | |
| Whiting Petroleum Corporation* | | | | | | | 265,756 | | | | 26,692,533 | |
| | |
| 30 | | The accompanying notes are an integral part of the financial statements. |
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE MID CAP STOCK FUND (cont’d) | |
| Common stocks—99.2% | | | | | Shares | | | Value | |
| Oil & gas services—2.9% | | | | | | | | | | | | |
| National Oilwell Varco, Inc. | | | | | | | 760,975 | | | | $40,910,016 | |
| | | |
| Packaging & containers—3.0% | | | | | | | | | | | | |
| Crown Holdings, Inc.* | | | | | | | 669,200 | | | | 21,541,548 | |
| Rock-Tenn Company, Class A | | | | | | | 343,657 | | | | 19,536,900 | |
| | | |
| Pharmaceuticals—1.2% | | | | | | | | | | | | |
| McKesson Corporation | | | | | | | 261,869 | | | | 17,278,117 | |
| | | |
| REITs—1.0% | | | | | | | | | | | | |
| Essex Property Trust, Inc. | | | | | | | 117,264 | | | | 13,246,141 | |
| | | |
| Retail—1.1% | | | | | | | | | | | | |
| Guess?, Inc. | | | | | | | 407,448 | | | | 15,857,876 | |
| | | |
| Semiconductors—4.3% | | | | | | | | | | | | |
| Marvell Technology Group Ltd.* | | | | | | | 1,585,435 | | | | 30,614,750 | |
| Microchip Technology, Inc. | | | | | | | 902,620 | | | | 29,046,312 | |
| | | |
| Software—6.4% | | | | | | | | | | | | |
| ANSYS, Inc.* | | | | | | | 484,383 | | | | 21,918,331 | |
| Check Point Software Technologies Ltd.* | | | | | | | 917,322 | | | | 39,215,515 | |
| Fidelity National Information Services, Inc. | | | | | | | 396,089 | | | | 10,734,012 | |
| Fiserv, Inc.* | | | | | | | 256,633 | | | | 13,991,631 | |
| Progress Software Corporation* | | | | | | | 54,435 | | | | 2,034,236 | |
| | | |
| Telecommunications—1.6% | | | | | | | | | | | | |
| Virgin Media, Inc. | | | | | | | 879,916 | | | | 22,376,264 | |
| | | |
| Textiles—1.1% | | | | | | | | | | | | |
| Mohawk Industries, Inc.* | | | | | | | 261,895 | | | | 15,017,059 | |
| | | |
| Toys/games/hobbies—2.6% | | | | | | | | | | | | |
| Hasbro, Inc. | | | | | | | 784,365 | | | | 36,276,881 | |
| Total common stocks (cost $1,196,092,586) | | | | | | | | | | | 1,380,054,055 | |
| | | |
| Short term investments—1.3% | | | | | |
| Principal
amount |
| | | Value | |
| JP Morgan Commercial Paper Sweep, 0.15% (cost $18,197,500) | | | | | | | $18,197,500 | | | | 18,197,500 | |
| |
| Total investment portfolio (cost $1,214,290,086) 100.5% | | | | 1,398,251,555 | |
| | | |
| Liabilities in excess of other assets (0.5)% | | | | | | | | | | | (7,167,477 | ) |
| | | |
| Net assets 100.0% | | | | | | | | | | | $1,391,084,078 | |
| |
| * Non-income producing security | | | | | |
| ADR—American depository receipt | | | | | |
| REIT—Real estate investment trust | | | | | |
| | | | |
| |
| Sector allocation (unaudited) | | | |
| Sector | | Percent of net assets | |
| Industrial | | | 25.7% | |
| Financial | | | 16.8% | |
| Technology | | | 13.1% | |
| Consumer, non-cyclical | | | 12.6% | |
| Consumer, cyclical | | | 12.2% | |
| Energy | | | 8.2% | |
| Basic materials | | | 6.7% | |
| Communications | | | 4.1% | |
| Utilities | | | 1.1% | |
| | | | | | | | | | | | |
| EAGLE SMALL CAP CORE VALUE FUND | |
| Common stocks—93.6% | | | | | Shares | | | Value | |
| Aerospace/defense—1.1% | | | | | | | | | | | | |
| Orbital Sciences Corporation* | | | | | | | 48,272 | | | | $783,937 | |
| | | |
| Banks—6.8% | | | | | | | | | | | | |
| Cardinal Financial Corporation | | | | | | | 50,776 | | | | 507,252 | |
| Columbia Banking System, Inc. | | | | | | | 16,086 | | | | 292,926 | |
| First Financial Bancorp | | | | | | | 48,234 | | | | 812,261 | |
| Oriental Financial Group, Inc. | | | | | | | 57,777 | | | | 764,390 | |
| PrivateBancorp, Inc. | | | | | | | 63,861 | | | | 752,921 | |
| Signature Bank* | | | | | | | 12,435 | | | | 525,254 | |
| Southwest Bancorp, Inc. | | | | | | | 27,795 | | | | 275,170 | |
| Sterling Bancshares, Inc. | | | | | | | 42,120 | | | | 227,027 | |
| Texas Capital Bancshares, Inc.* | | | | | | | 38,571 | | | | 700,064 | |
| | | |
| Biotechnology—1.6% | | | | | | | | | | | | |
| Charles River Laboratories International, Inc.* | | | | | | | 8,355 | | | | 273,793 | |
| Cubist Pharmaceuticals, Inc.* | | | | | | | 36,162 | | | | 841,851 | |
| | | |
| Chemicals—1.9% | | | | | | | | | | | | |
| Kraton Performance Polymers, Inc.* | | | | | | | 24,759 | | | | 803,677 | |
| Westlake Chemical Corporation | | | | | | | 17,677 | | | | 564,957 | |
| | | |
| Coal—1.3% | | | | | | | | | | | | |
| Alpha Natural Resources, Inc.* | | | | | | | 20,222 | | | | 913,428 | |
| | | |
| Commercial services—9.2% | | | | | | | | | | | | |
| Chemed Corporation | | | | | | | 19,325 | | | | 1,139,016 | |
| Cross Country Healthcare, Inc.* | | | | | | | 61,532 | | | | 449,184 | |
| Euronet Worldwide, Inc.* | | | | | | | 64,014 | | | | 1,156,093 | |
| Gartner, Inc.* | | | | | | | 32,785 | | | | 1,038,957 | |
| LECG Corporation* | | | | | | | 166,489 | | | | 143,181 | |
| Net 1 UEPS Technologies, Inc.* | | | | | | | 68,168 | | | | 840,511 | |
| On Assignment, Inc.* | | | | | | | 98,725 | | | | 557,796 | |
| Parexel International Corporation* | | | | | | | 31,705 | | | | 681,657 | |
| The Providence Service Corporation* | | | | | | | 30,455 | | | | 500,376 | |
| | | |
| Computers—3.4% | | | | | | | | | | | | |
| Electronics for Imaging, Inc.* | | | | | | | 51,535 | | | | 705,514 | |
| Insight Enterprises, Inc.* | | | | | | | 29,425 | | | | 444,906 | |
| Mercury Computer Systems, Inc.* | | | | | | | 37,125 | | | | 588,060 | |
| SMART Modular Technologies WWH, Inc.* | | | | | | | 99,196 | | | | 733,058 | |
| | | |
| Distribution/wholesale—0.5% | | | | | | | | | | | | |
| School Specialty, Inc.* | | | | | | | 26,426 | | | | 354,108 | |
| | | |
| Diversified financial services—4.0% | | | | | | | | | | | | |
| Cowen Group, Inc., Class A* | | | | | | | 75,795 | | | | 265,282 | |
| Investment Technology Group, Inc.* | | | | | | | 42,260 | | | | 601,782 | |
| MarketAxess Holdings, Inc. | | | | | | | 43,036 | | | | 781,964 | |
| optionsXpress Holdings, Inc.* | | | | | | | 40,902 | | | | 653,205 | |
| SWS Group, Inc. | | | | | | | 71,564 | | | | 491,645 | |
| | | |
| Electric—1.3% | | | | | | | | | | | | |
| Allete, Inc. | | | | | | | 26,014 | | | | 946,389 | |
| | | |
| Electrical components & equipment—1.0% | | | | | | | | | | | | |
| Belden, Inc. | | | | | | | 25,300 | | | | 705,870 | |
| | | |
| Electronics—1.9% | | | | | | | | | | | | |
| Benchmark Electronics, Inc.* | | | | | | | 26,105 | | | | 428,905 | |
| Sonic Solutions, Inc.* | | | | | | | 76,358 | | | | 914,005 | |
| | | |
| Engineering & construction—2.0% | | | | | | | | | | | | |
| Dycom Industries, Inc.* | | | | | | | 69,103 | | | | 739,402 | |
| URS Corporation* | | | | | | | 17,358 | | | | 675,747 | |
| Entertainment—0.3% | | | | | | | | | | | | |
| Lions Gate Entertainment Corporation* | | | | | | | 27,393 | | | | 198,051 | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 31 | |
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE SMALL CAP CORE VALUE FUND (cont’d) | | | | | | | | | |
| Common stocks—93.6% | | | | | Shares | | | Value | |
| | | |
| Environmental control—0.3% | | | | | | | | | | | | |
| Casella Waste Systems, Inc., Class A* | | | | | | | 46,092 | | | | $227,234 | |
| | | |
| Gas—1.4% | | | | | | | | | | | | |
| AGL Resources, Inc. | | | | | | | 25,590 | | | | 1,004,663 | |
| | | |
| Healthcare products—1.5% | | | | | | | | | | | | |
| Merit Medical Systems, Inc.* | | | | | | | 67,042 | | | | 1,059,934 | |
| | | |
| Healthcare services—4.8% | | | | | | | | | | | | |
| AMERIGROUP Corporation* | | | | | | | 29,678 | | | | 1,238,463 | |
| Amsurg Corporation* | | | | | | | 49,905 | | | | 902,282 | |
| Mednax, Inc.* | | | | | | | 13,380 | | | | 792,230 | |
| Psychiatric Solutions, Inc.* | | | | | | | 12,914 | | | | 435,202 | |
| | | |
| Household products/wares—1.2% | | | | | | | | | | | | |
| Jarden Corporation | | | | | | | 26,192 | | | | 839,716 | |
| | | |
| Insurance—5.8% | | | | | | | | | | | | |
| American Equity Investment Life Holding Company | | | | | | | 91,229 | | | | 989,835 | |
| Assured Guaranty Ltd. | | | | | | | 49,960 | | | | 951,738 | |
| First Mercury Financial Corporation | | | | | | | 35,515 | | | | 578,894 | |
| Platinum Underwriters Holdings Ltd. | | | | | | | 17,620 | | | | 758,541 | |
| Stewart Information Services Corporation | | | | | | | 30,288 | | | | 327,716 | |
| Tower Group, Inc. | | | | | | | 12,375 | | | | 300,465 | |
| Validus Holdings Ltd. | | | | | | | 6,954 | | | | 197,215 | |
| | | |
| Internet—1.8% | | | | | | | | | | | | |
| 1-800-FLOWERS.COM, Inc., Class A* | | | | | | | 143,285 | | | | 257,913 | |
| DealerTrack Holdings, Inc.* | | | | | | | 34,973 | | | | 675,678 | |
| Equinix, Inc.* | | | | | | | 3,666 | | | | 308,824 | |
| | | |
| Machinery-diversified—1.5% | | | | | | | | | | | | |
| Altra Holdings, Inc.* | | | | | | | 49,275 | | | | 729,270 | |
| Wabtec Corporation | | | | | | | 7,025 | | | | 329,051 | |
| | | |
| Media—1.3% | | | | | | | | | | | | |
| John Wiley & Sons, Inc., Class A | | | | | | | 21,785 | | | | 940,241 | |
| | | |
| Metal fabricate/hardware—0.7% | | | | | | | | | | | | |
| Kaydon Corporation | | | | | | | 13,805 | | | | 481,380 | |
| | | |
| Mining—2.0% | | | | | | | | | | | | |
| Gammon Gold, Inc.* | | | | | | | 72,771 | | | | 497,026 | |
| IAMGOLD Corporation | | | | | | | 51,400 | | | | 939,592 | |
| | | |
| Miscellaneous manufacturing—2.0% | | | | | | | | | | | | |
| Barnes Group, Inc. | | | | | | | 39,945 | | | | 726,600 | |
| Matthews International Corporation, Class A | | | | | | | 20,460 | | | | 675,589 | |
| | | |
| Oil & gas—1.9% | | | | | | | | | | | | |
| Comstock Resources, Inc.* | | | | | | | 18,585 | | | | 415,375 | |
| Rosetta Resources, Inc.* | | | | | | | 38,605 | | | | 923,046 | |
| | | |
| Oil & gas services—3.1% | | | | | | | | | | | | |
| Dresser-Rand Group, Inc.* | | | | | | | 29,961 | | | | 1,025,265 | |
| Oceaneering International, Inc.* | | | | | | | 18,226 | | | | 1,127,643 | |
| | | |
| Packaging & containers—0.6% | | | | | | | | | | | | |
| Silgan Holdings, Inc. | | | | | | | 12,286 | | | | 414,653 | |
| | | |
| Pharmaceuticals—1.8% | | | | | | | | | | | | |
| Herbalife Ltd. | | | | | | | 19,681 | | | | 1,256,829 | |
| | | |
| REITs—3.2% | | | | | | | | | | | | |
| BioMed Realty Trust, Inc. | | | | | | | 38,565 | | | | 707,668 | |
| Campus Crest Communities, Inc.* | | | | | | | 24,930 | | | | 311,625 | |
| Chimera Investment Corporation | | | | | | | 77,880 | | | | 319,308 | |
| Government Properties Income Trust | | | | | | | 35,698 | | | | 952,780 | |
| | | | | | | | | | | | |
| | |
| Common stocks—93.6% | | | | | Shares | | | Value | |
| Retail—6.3% | | | | | | | | | | | | |
| AerCap Holdings NV* | | | | | | | 43,003 | | | | $555,169 | |
| AFC Enterprises, Inc.* | | | | | | | 91,715 | | | | 1,165,698 | |
| Jo-Ann Stores, Inc.* | | | | | | | 26,645 | | | | 1,152,396 | |
| Nu Skin Enterprises, Inc., Class A | | | | | | | 30,015 | | | | 918,459 | |
| Stage Stores, Inc. | | | | | | | 52,596 | | | | 701,105 | |
| | | |
| Savings & loans—0.9% | | | | | | | | | | | | |
| Berkshire Hills Bancorp, Inc. | | | | | | | 34,012 | | | | 657,792 | |
| | | |
| Semiconductors—1.8% | | | | | | | | | | | | |
| Microsemi Corporation* | | | | | | | 42,685 | | | | 853,700 | |
| Varian Semiconductor Equipment Associates, Inc.* | | | | | | | 13,345 | | | | 435,981 | |
| | | |
| Software—6.0% | | | | | | | | | | | | |
| ACI Worldwide, Inc.* | | | | | | | 26,409 | | | | 643,587 | |
| Aspen Technology, Inc.* | | | | | | | 116,162 | | | | 1,301,014 | |
| Avid Technology, Inc.* | | | | | | | 37,195 | | | | $469,401 | |
| Bottomline Technologies, Inc.* | | | | | | | 80,236 | | | | 1,445,853 | |
| Innerworkings, Inc.* | | | | | | | 64,308 | | | | 441,796 | |
| | | |
| Telecommunications—5.7% | | | | | | | | | | | | |
| Alaska Communications Systems Group, Inc. | | | | | | | 76,617 | | | | 768,469 | |
| Cbeyond, Inc.* | | | | | | | 44,188 | | | | 598,747 | |
| CommScope, Inc.* | | | | | | | 32,580 | | | | 1,031,483 | |
| Symmetricom, Inc.* | | | | | | | 119,544 | | | | 744,759 | |
| Syniverse Holdings, Inc.* | | | | | | | 27,235 | | | | 830,395 | |
| | | |
| Transportation—1.7% | | | | | | | | | | | | |
| Crude Carriers Corporation | | | | | | | 32,602 | | | | 574,447 | |
| Genesee & Wyoming, Inc., Class A* | | | | | | | 13,800 | | | | 637,974 | |
| Total common stocks (cost $42,878,605) | | | | | | | | | | | 66,321,281 | |
| | | |
| Investment companies—3.0% | | | | | | | | | | | | |
| Apollo Investment Corporation | | | | | | | 35,148 | | | | 386,277 | |
| iShares Russell 2000 Index Fund (ETF) | | | | | | | 12,110 | | | | 851,454 | |
| iShares Russell 2000 Value Index Fund (ETF) | | | | | | | 13,915 | | | | 895,848 | |
| Total investment companies (cost $1,470,244) | | | | | | | | | | | 2,133,579 | |
| | | |
| Short term investments—3.3% | | | | | Principal
Amount | | | Value | |
JP Morgan Commercial Paper Sweep, 0.15%
(cost $2,348,057) | | | | | | | $2,348,057 | | | | 2,348,057 | |
| | | |
| Total investment portfolio (cost $46,696,906) 99.9% | | | | | | | | | | | 70,802,917 | |
| | | |
| Other assets in excess of liabilities 0.1% | | | | | | | | | | | 53,646 | |
| | | |
| Net assets 100.0% | | | | | | | | | | | $70,856,563 | |
| | | |
| * Non-income producing security | | | | | | | | | | | | |
| | | |
ETF—Exchange-traded fund REIT—Real estate investment trust | | | | | | | | | | | | |
| | |
| 32 | | The accompanying notes are an integral part of the financial statements. |
Investment Portfolios
| | | | | | |
| EAGLE SMALL CAP CORE VALUE FUND (cont’d) | | | | | | |
| | | | |
| Sector allocation (unaudited) | | | |
| Sector | | Percent of net assets | |
| Financial | | | 27.0% | |
| Consumer, non-cyclical | | | 20.1% | |
| Industrial | | | 12.8% | |
| Technology | | | 11.4% | |
| Communications | | | 8.7% | |
| Consumer, cyclical | | | 7.1% | |
| Energy | | | 6.2% | |
| Basic materials | | | 3.9% | |
| Utilities | | | 2.7% | |
| | | | | | | | | | | | |
| | | | |
| EAGLE SMALL CAP GROWTH FUND | | | | | | | | | |
| Common stocks—98.8% | | | | | Shares | | | Value | |
| Aerospace/defense—1.7% | | | | | | | | | | | | |
| Triumph Group, Inc. | | | | | | | 97,701 | | | | $8,166,827 | |
| | | |
| Airlines—1.0% | | | | | | | | | | | | |
| JetBlue Airways Corporation* | | | | | | | 672,985 | | | | 4,697,435 | |
| | | |
| Apparel—2.7% | | | | | | | | | | | | |
| Deckers Outdoor Corporation* | | | | | | | 118,965 | | | | 6,911,866 | |
| Steven Madden Ltd.* | | | | | | | 146,088 | | | | 6,179,522 | |
| | | |
| Auto parts & equipment—4.9% | | | | | | | | | | | | |
| American Axle & Manufacturing Holdings, Inc.* | | | | | | | 493,290 | | | | 4,548,134 | |
| ArvinMeritor, Inc.* | | | | | | | 449,972 | | | | 7,460,536 | |
| Tenneco, Inc.* | | | | | | | 193,601 | | | | 6,315,265 | |
| WABCO Holdings, Inc.* | | | | | | | 127,280 | | | | 5,908,338 | |
| | | |
| Banks—0.5% | | | | | | | | | | | | |
| UMB Financial Corporation | | | | | | | 60,922 | | | | 2,257,769 | |
| | | |
| Biotechnology—1.6% | | | | | | | | | | | | |
| Regeneron Pharmaceuticals, Inc.* | | | | | | | 130,753 | | | | 3,410,038 | |
| Seattle Genetics, Inc.* | | | | | | | 275,161 | | | | 4,509,889 | |
| | | |
| Chemicals—4.0% | | | | | | | | | | | | |
| Huntsman Corporation | | | | | | | 980,276 | | | | 13,576,823 | |
| Intrepid Potash, Inc.* | | | | | | | 168,150 | | | | 5,772,590 | |
| | | |
| Coal—0.9% | | | | | | | | | | | | |
| Cloud Peak Energy, Inc.* | | | | | | | 258,255 | | | | 4,485,889 | |
| | | |
| Commercial services—8.2% | | | | | | | | | | | | |
| FTI Consulting, Inc.* | | | | | | | 249,675 | | | | 8,853,476 | |
| Monster Worldwide, Inc.* | | | | | | | 237,363 | | | | 4,286,776 | |
| Sotheby’s | | | | | | | 256,385 | | | | 11,239,918 | |
| SuccessFactors, Inc.* | | | | | | | 211,868 | | | | 5,745,860 | |
| The Geo Group, Inc.* | | | | | | | 387,670 | | | | 9,943,736 | |
| | | |
| Computers—3.2% | | | | | | | | | | | | |
| Radiant Systems, Inc.* | | | | | | | 270,675 | | | | 5,280,869 | |
| Riverbed Technology, Inc.* | | | | | | | 173,561 | | | | 9,986,700 | |
| | | |
| Diversified financial services—1.0% | | | | | | | | | | | | |
| Duff & Phelps Corporation, Class A | | | | | | | 198,122 | | | | 2,761,821 | |
| optionsXpress Holdings, Inc.* | | | | | | | 118,797 | | | | 1,897,188 | |
| | | |
| Electrical components & equipment—1.4% | | | | | | | | | | | | |
| GrafTech International Ltd.* | | | | | | | 410,155 | | | | 6,755,253 | |
| | | |
| Electronics—1.7% | | | | | | | | | | | | |
| Coherent, Inc.* | | | | | | | 202,856 | | | | 8,511,838 | |
| | | | | | | | | | | | |
| | | | | | | | | | |
| Common stocks—98.8% | | | | | Shares | | | Value | |
| Entertainment—3.8% | | | | | | | | | | | | |
| Bally Technologies, Inc.* | | | | | | | 197,372 | | | | $7,121,182 | |
| Pinnacle Entertainment, Inc.* | | | | | | | 371,960 | | | | 4,761,088 | |
| Shuffle Master, Inc.* | | | | | | | 668,624 | | | | 6,291,752 | |
| | | |
| Environmental control—1.7% | | | | | | | | | | | | |
| Waste Connections, Inc. | | | | | | | 199,207 | | | | 8,115,693 | |
| | | |
| Food—1.5% | | | | | | | | | | | | |
| Dean Foods Company* | | | | | | | 706,055 | | | | 7,342,972 | |
| | | |
| Hand/machine tools—1.5% | | | | | | | | | | | | |
| Regal-Beloit Corporation | | | | | | | 128,306 | | | | 7,404,539 | |
| | | |
| Healthcare products—4.7% | | | | | | | | | | | | |
| Bruker Corporation* | | | | | | | 383,656 | | | | 5,751,003 | |
| Sirona Dental Systems, Inc.* | | | | | | | 128,026 | | | | 4,820,179 | |
| Thoratec Corporation* | | | | | | | 326,217 | | | | 10,647,723 | |
| Vital Images, Inc.* | | | | | | | 128,455 | | | | 1,708,452 | |
| | | |
| Healthcare services—2.2% | | | | | | | | | | | | |
| Centene Corporation* | | | | | | | 276,667 | | | | 6,175,207 | |
| ICON PLC, Sponsored ADR* | | | | | | | 219,028 | | | | 4,238,192 | |
| | | |
| Home furnishings—3.4% | | | | | | | | | | | | |
| DTS, Inc.* | | | | | | | 243,004 | | | | 9,671,559 | |
| Universal Electronics, Inc.* | | | | | | | 320,142 | | | | 6,742,191 | |
| | | |
| Insurance—0.8% | | | | | | | | | | | | |
| MGIC Investment Corporation* | | | | | | | 430,849 | | | | 3,800,088 | |
| | | |
| Internet—2.9% | | | | | | | | | | | | |
| TIBCO Software, Inc.* | | | | | | | 745,334 | | | | 14,325,319 | |
| | | |
| Lodging—1.0% | | | | | | | | | | | | |
| Choice Hotels International, Inc. | | | | | | | 133,148 | | | | 5,063,618 | |
| | | |
| Metal fabricate/hardware—0.7% | | | | | | | | | | | | |
| Northwest Pipe Company* | | | | | | | 176,524 | | | | 3,322,182 | |
| | | |
| Mining—1.3% | | | | | | | | | | | | |
| Titanium Metals Corporation* | | | | | | | 319,608 | | | | 6,283,493 | |
| | | |
| Oil & gas—1.3% | | | | | | | | | | | | |
| Brigham Exploration Company* | | | | | | | 292,910 | | | | 6,177,472 | |
| | | |
| Oil & gas services—4.9% | | | | | | | | | | | | |
| Lufkin Industries, Inc. | | | | | | | 323,627 | | | | 15,809,179 | |
| OYO Geospace Corporation* | | | | | | | 130,554 | | | | 7,912,878 | |
| | | |
| Pharmaceuticals—3.1% | | | | | | | | | | | | |
| BioMarin Pharmaceutical, Inc.* | | | | | | | 242,618 | | | | 6,346,887 | |
| Herbalife Ltd. | | | | | | | 88,730 | | | | 5,666,298 | |
| Salix Pharmaceuticals Ltd.* | | | | | | | 80,883 | | | | 3,059,804 | |
| | | |
| REITs—0.6% | | | | | | | | | | | | |
| Redwood Trust, Inc. | | | | | | | 219,184 | | | | 3,108,029 | |
| | | |
| Retail—9.5% | | | | | | | | | | | | |
| BJ’s Restaurants, Inc.* | | | | | | | 320,170 | | | | 10,613,635 | |
| Cash America International, Inc. | | | | | | | 233,869 | | | | 8,239,205 | |
| Chico’s FAS, Inc. | | | | | | | 681,982 | | | | 6,628,865 | |
| Genesco, Inc.* | | | | | | | 359,545 | | | | 11,778,694 | |
| Vitamin Shoppe, Inc.* | | | | | | | 314,675 | | | | 8,751,112 | |
| | | |
| Semiconductors—8.6% | | | | | | | | | | | | |
| Netlogic Microsystems, Inc.* | | | | | | | 196,529 | | | | 5,907,662 | |
| Rovi Corporation* | | | | | | | 320,760 | | | | 16,246,494 | |
| Teradyne, Inc.* | | | | | | | 331,980 | | | | 3,731,455 | |
| Varian Semiconductor Equipment Associates, Inc.* | | | | | | | 294,723 | | | | 9,628,600 | |
| Veeco Instruments, Inc.* | | | | | | | 146,205 | | | | 6,118,679 | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 33 | |
Investment Portfolios
| | | | | | | | | | | | |
| EAGLE SMALL CAP GROWTH FUND (cont’d) | |
| Common stocks—98.8% | | | | | Shares | | | Value | |
| | | |
| Software—8.2% | | | | | | | | | | | | |
| Allscripts Healthcare Solutions, Inc.* | | | | | | | 457,412 | | | | $8,731,995 | |
| ANSYS, Inc.* | | | | | | | 229,508 | | | | 10,385,237 | |
| Informatica Corporation* | | | | | | | 306,887 | | | | 12,487,232 | |
| MedAssets, Inc.* | | | | | | | 247,036 | | | | 4,580,047 | |
| Quality Systems, Inc. | | | | | | | 59,714 | | | | 3,837,222 | |
| | | |
| Telecommunications—2.2% | | | | | | | | | | | | |
| EMS Technologies, Inc.* | | | | | | | 309,114 | | | | 5,514,594 | |
| Plantronics, Inc. | | | | | | | 148,497 | | | | 5,328,072 | |
| | | |
| Transportation—2.1% | | | | | | | | | | | | |
| Atlas Air Worldwide Holdings, Inc.* | | | | | | | 79,700 | | | | 4,165,122 | |
| Landstar System, Inc. | | | | | | | 158,372 | | | | 5,957,955 | |
| | | |
| Total common stocks (cost $333,941,019) | | | | | | | | | | | 479,763,212 | |
| | | |
| Short term investments—1.7% | | | | | |
| Principal
amount |
| | | Value | |
JP Morgan Commercial Paper Sweep, 0.15%
(cost $8,402,487) | | | | | | | $8,402,487 | | | | $8,402,487 | |
| |
| Total investment portfolio (cost $342,343,506) 100.5% | | | | 488,165,699 | |
| | | |
| Liabilities in excess of other assets (0.5)% | | | | | | | | | | | (2,304,674 | ) |
| | | |
| Net assets 100.0% | | | | | | | | | | | $485,861,025 | |
| | |
| * Non-income producing security | | | | | | | | |
| | | |
ADR—American depository receipt REIT—Real estate investment trust | | | | | | | | | | | | |
| | | | |
| |
| Sector allocation (unaudited) | | | |
| Sector | | Percent of net assets | |
| Consumer, cyclical | | | 26.3% | |
| Consumer, non-cyclical | | | 21.3% | |
| Technology | | | 20.0% | |
| Industrial | | | 10.8% | |
| Energy | | | 7.1% | |
| Basic materials | | | 5.3% | |
| Communications | | | 5.1% | |
| Financial | | | 4.6% | |
| | |
| 34 | | The accompanying notes are an integral part of the financial statements. |
[THIS PAGE INTENTIONALLY LEFT BLANK]
Statements of Assets and Liabilities
| | | | | | | | | | | | | | | | |
| | | Eagle
Capital
Appreciation
Fund | | | Eagle
Growth
& Income
Fund | | | Eagle
International
Equity
Fund | | | Eagle
Investment
Grade Bond
Fund | |
| | | | |
| Assets | | | | | | | | | | | | | | | | |
| Investments, at value (a) | | | $594,203,885 | | | | $208,185,061 | | | | $84,475,130 | | | | $101,056,883 | |
| Cash | | | — | | | | 106,101 | | | | — | | | | 54,530 | |
| Foreign currency (identified cost $405,501 and $447,473) | | | — | | | | 412,709 | | | | 463,489 | | | | — | |
| Receivable for investments sold | | | 4,286,456 | | | | — | | | | 2,983,036 | | | | 1,026,210 | |
| Receivable for fund shares sold | | | 1,446,557 | | | | 504,381 | | | | 22,524 | | | | 1,050,249 | |
| Receivable for dividends and interest | | | 333,855 | | | | 189,699 | | | | 136,615 | | | | 783,461 | |
| Receivable for recoverable foreign withholding taxes | | | — | | | | 63,043 | | | | 114,580 | | | | — | |
| Prepaid expenses | | | — | | | | 4,178 | | | | 48,682 | | | | 49,783 | |
| Unrealized gain on forward foreign currency exchange contracts | | | — | | | | — | | | | 366,202 | | | | — | |
| Total assets | | | 600,270,753 | | | | 209,465,172 | | | | 88,610,258 | | | | 104,021,116 | |
| | | | |
| Liabilities | | | | | | | | | | | | | | | | |
| Payable for investments purchased | | | 11,787,321 | | | | — | | | | 2,437,445 | | | | 2,139,817 | |
| Payable for fund shares redeemed | | | 1,266,013 | | | | 452,347 | | | | 440,171 | | | | 52,548 | |
| Payable to the custodian | | | 3,839 | | | | 4,964 | | | | 946,607 | | | | 894 | |
| Accrued investment advisory fees | | | 295,599 | | | | 91,756 | | | | 61,824 | | | | 24,674 | |
| Accrued administrative fees | | | 72,433 | | | | 26,019 | | | | 10,882 | | | | 12,240 | |
| Accrued distribution fees | | | 167,449 | | | | 87,327 | | | | 48,286 | | | | 49,918 | |
| Accrued shareholder servicing fees | | | 177,259 | | | | 49,578 | | | | 27,032 | | | | 7,832 | |
| Accrued fund accounting fees | | | 21,903 | | | | 17,143 | | | | 23,808 | | | | 18,923 | |
| Accrued internal audit fees | | | 228 | | | | 228 | | | | 228 | | | | 228 | |
| Accrued trustees and officers compensation | | | 8,402 | | | | 9,842 | | | | 9,750 | | | | 5,210 | |
| Other accrued expenses | | | 4,849 | | | | 17,769 | | | | 15,627 | | | | 2,337 | |
| Unrealized loss on forward foreign currency exchange contracts | | | — | | | | — | | | | 522,744 | | | | — | |
| Total liabilities | | | 13,805,295 | | | | 756,973 | | | | 4,544,404 | | | | 2,314,621 | |
| Net assets | | | 586,465,458 | | | | 208,708,199 | | | | 84,065,854 | | | | 101,706,495 | |
| | | | |
| Net assets consists of | | | | | | | | | | | | | | | | |
| Paid-in capital | | | 543,685,433 | | | | 201,775,315 | | | | 152,471,618 | | | | 98,633,965 | |
| Undistributed net investment income (loss) | | | — | | | | 128,562 | | | | 838,578 | | | | 202,877 | |
| Accumulated net realized gain (loss) | | | (68,440,754 | ) | | | (11,205,312 | ) | | | (84,345,649 | ) | | | 530,800 | |
| Net unrealized depreciation on forward foreign currency contracts | | | — | | | | — | | | | (156,542 | ) | | | — | |
| Net unrealized appreciation on investments and other assets and liabilities denominated in foreign currencies | | | 111,220,779 | | | | 18,009,634 | | | | 15,257,849 | | | | 2,338,853 | |
| Net assets | | | 586,465,458 | | | | 208,708,199 | | | | 84,065,854 | | | | 101,706,495 | |
| | | | |
| Net assets, at market value | | | | | | | | | | | | | | | | |
| Class A | | | 469,473,671 | | | | 128,131,438 | | | | 37,288,662 | | | | 47,824,890 | |
| Class C | | | 81,462,470 | | | | 71,612,380 | | | | 46,341,865 | | | | 49,912,152 | |
| Class I | | | 11,228,731 | | | | 8,565,494 | | | | 430,236 | | | | 3,912,074 | |
| Class R-3 | | | 675,785 | | | | 396,199 | | | | 2,518 | | | | 54,734 | |
| Class R-5 | | | 23,624,801 | | | | 2,688 | | | | 2,573 | | | | 2,645 | |
| | | | |
Net asset value (“NAV”),
offering and redemption price per share | | | | | | | | | | | | | | | | |
| Class A | | | $26.24 | | | | $12.83 | | | | $21.50 | | | | $15.15 | |
| Maximum offering price (b) | | | $27.55 | | | | $13.47 | | | | $22.57 | | | | $15.74 | |
| Class C | | | $22.88 | | | | $12.46 | | | | $19.32 | | | | $15.13 | |
| Class I | | | $26.72 | | | | $12.82 | | | | $21.67 | | | | $15.17 | |
| Class R-3 | | | $26.03 | | | | $12.81 | | | | $20.95 | | | | $15.15 | |
| Class R-5 | | | $26.67 | | | | $12.83 | | | | $21.49 | | | | $14.73 | |
| | | | |
| Shares of beneficial interest outstanding | | | | | | | | | | | | | | | | |
| Class A | | | 17,893,665 | | | | 9,984,741 | | | | 1,734,200 | | | | 3,156,398 | |
| Class C | | | 3,559,979 | | | | 5,746,072 | | | | 2,398,123 | | | | 3,297,831 | |
| Class I | | | 420,288 | | | | 668,160 | | | | 19,853 | | | | 257,900 | |
| Class R-3 | | | 25,962 | | | | 30,924 | | | | 120 | | | | 3,613 | |
| Class R-5 | | | 885,685 | | | | 209 | | | | 120 | | | | 175 | |
| | | | |
| (a) Identified cost | | | $482,983,106 | | | | $190,186,435 | | | | $69,237,307 | | | | $98,718,030 | |
(b) For all funds except the Eagle Investment Grade Bond Fund, the maximum offering price is computed as 100/95.25 of NAV. The maximum offering price for the Eagle Investment Grade Bond Fund is computed as 100/96.25 of NAV.
| | |
| 36 | | The accompanying notes are an integral part of the financial statements. |
Statements of Assets and Liabilities
| | | | | | | | | | | | | | | | | | |
Eagle
Large Cap
Core
Fund | | | Eagle
Mid Cap
Growth
Fund | | | Eagle
Mid Cap
Stock
Fund | | | Eagle
Small Cap
Core Value
Fund | | | Eagle
Small Cap
Growth
Fund | |
| | | | |
| | | | | | | | | | | | | | | | | | |
| | $136,520,891 | | | | $214,470,359 | | | | $1,398,251,555 | | | | $70,802,917 | | | | $488,165,699 | |
| | 611,164 | | | | 596,172 | | | | — | | | | — | | | | — | |
| | — | | | | — | | | | — | | | | — | | | | — | |
| | — | | | | 2,098,534 | | | | 50,076,512 | | | | — | | | | — | |
| | 195,487 | | | | 244,634 | | | | 1,237,753 | | | | 169,184 | | | | 1,374,771 | |
| | 88,469 | | | | 24,070 | | | | 371,584 | | | | 16,505 | | | | 31,588 | |
| | 5,361 | | | | — | | | | — | | | | — | | | | — | |
| | 30,719 | | | | 43 | | | | 11,767 | | | | 65,477 | | | | — | |
| | — | | | | — | | | | — | | | | — | | | | — | |
| | 137,452,091 | | | | 217,433,812 | | | | 1,449,949,171 | | | | 71,054,083 | | | | 489,572,058 | |
| | | | |
| | | | | | | | | | | | | | | | | | |
| | — | | | | 2,117,462 | | | | 48,920,468 | | | | — | | | | 2,028,905 | |
| | 207,688 | | | | 575,715 | | | | 8,319,290 | | | | 65,608 | | | | 1,097,297 | |
| | 882 | | | | 1,410 | | | | 11,063 | | | | 1,172 | | | | 2,909 | |
| | 69,178 | | | | 105,777 | | | | 643,906 | | | | 35,519 | | | | 238,588 | |
| | 12,353 | | | | 25,830 | | | | 157,093 | | | | 6,540 | | | | 53,723 | |
| | 9,670 | | | | 77,014 | | | | 355,182 | | | | 6,290 | | | | 115,285 | |
| | 60,063 | | | | 45,761 | | | | 398,253 | | | | 31,522 | | | | 134,221 | |
| | 14,935 | | | | 15,646 | | | | 27,649 | | | | 14,315 | | | | 18,246 | |
| | 228 | | | | 228 | | | | 228 | | | | 229 | | | | 228 | |
| | 9,765 | | | | 9,765 | | | | 9,766 | | | | 9,765 | | | | 9,765 | |
| | 17,334 | | | | 3,784 | | | | 22,195 | | | | 26,560 | | | | 11,866 | |
| | — | | | | — | | | | — | | | | — | | | | — | |
| | 402,096 | | | | 2,978,392 | | | | 58,865,093 | | | | 197,520 | | | | 3,711,033 | |
| | 137,049,995 | | | | 214,455,420 | | | | 1,391,084,078 | | | | 70,856,563 | | | | 485,861,025 | |
| | | | |
| | | | | | | | | | | | | | | | | | |
| | 189,958,653 | | | | 168,228,000 | | | | 1,407,008,184 | | | | 40,591,399 | | | | 392,939,711 | |
| | 526,041 | | | | — | | | | (208,006 | ) | | | (39,979 | ) | | | 17,352 | |
| | (64,982,671 | ) | | | (7,455,598 | ) | | | (199,677,569 | ) | | | 6,202,132 | | | | (52,918,231 | ) |
| | — | | | | — | | | | — | | | | — | | | | — | |
|
11,547,972 |
| | | 53,683,018 | | | | 183,961,469 | | | | 24,103,011 | | | | 145,822,193 | |
| | 137,049,995 | | | | 214,455,420 | | | | 1,391,084,078 | | | | 70,856,563 | | | | 485,861,025 | |
| | | | |
| | | | | | | | | | | | | | | | | | |
| | 10,545,500 | | | | 139,744,594 | | | | 736,097,679 | | | | 10,116,246 | | | | 265,548,016 | |
| | 8,741,660 | | | | 58,033,160 | | | | 239,539,197 | | | | 5,025,277 | | | | 72,536,261 | |
| | 117,737,929 | | | | 15,175,142 | | | | 340,180,474 | | | | 55,709,535 | | | | 96,655,342 | |
| | 2,557 | | | | 1,340,568 | | | | 3,594,396 | | | | 2,744 | | | | 1,895,444 | |
| | 22,349 | | | | 161,956 | | | | 71,672,332 | | | | 2,761 | | | | 49,225,962 | |
| | | | |
| | | | | | | | | | | | | | | | | | |
| | $13.09 | | | | $28.03 | | | | $25.37 | | | | $19.63 | | | | $33.79 | |
| | $13.74 | | | | $29.43 | | | | $26.64 | | | | $20.61 | | | | $35.48 | |
| | $12.88 | | | | $24.71 | | | | $22.28 | | | | $19.32 | | | | $28.65 | |
| | $13.10 | | | | $28.58 | | | | $25.79 | | | | $19.80 | | | | $34.41 | |
| | $13.06 | | | | $27.88 | | | | $25.17 | | | | $19.60 | | | | $33.52 | |
| | $13.39 | | | | $28.56 | | | | $25.83 | | | | $19.79 | | | | $34.39 | |
| | | | |
| | | | | | | | | | | | | | | | | | |
| | 805,771 | | | | 4,985,224 | | | | 29,014,299 | | | | 515,226 | | | | 7,858,647 | |
| | 678,923 | | | | 2,348,242 | | | | 10,750,809 | | | | 260,067 | | | | 2,531,529 | |
| | 8,985,032 | | | | 531,004 | | | | 13,190,429 | | | | 2,813,823 | | | | 2,809,313 | |
| | 196 | | | | 48,085 | | | | 142,801 | | | | 140 | | | | 56,549 | |
| | 1,669 | | | | 5,671 | | | | 2,774,686 | | | | 140 | | | | 1,431,444 | |
| | | | |
| | $124,972,919 | | | | $160,787,341 | | | | $1,214,290,086 | | | | $46,696,906 | | | | $342,343,506 | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 37 | |
Statements of Operations
| | | | | | | | | | | | | | | | |
| | | Eagle
Capital
Appreciation
Fund | | | Eagle
Growth
& Income
Fund | | | Eagle
International
Equity
Fund | | | Eagle
Investment
Grade Bond
Fund (c) | |
| | | | |
| Investment Income | | | | | | | | | | | | | | | | |
| Dividends (a) | | | $6,041,403 | | | | $5,034,628 | | | | $2,160,072 | | | | $ — | |
| Interest | | | 6,341 | | | | 427,100 | | | | 684 | | | | 938,158 | |
| Total Income | | | 6,047,744 | | | | 5,461,728 | | | | 2,160,756 | | | | 938,158 | |
| | | | |
| Expenses | | | | | | | | | | | | | | | | |
| Investment advisory fees | | | 3,325,226 | | | | 969,431 | | | | 847,349 | | | | 131,305 | |
| Administrative fees | | | | | | | | | | | | | | | | |
| Class A | | | 644,165 | | | | 170,203 | | | | 64,662 | | | | 31,066 | |
| Class C | | | 126,983 | | | | 93,174 | | | | 82,670 | | | | 27,771 | |
| Class I | | | 16,662 | | | | 5,430 | | | | 175 | | | | 853 | |
| Class R-3 | | | 1.035 | | | | 472 | | | | 3 | | | | 10 | |
| Class R-5 | | | 22,763 | | | | 2 | | | | 2 | | | | 2 | |
| Distribution and service fees | | | | | | | | | | | | | | | | |
| Class A | | | 1,080,939 | | | | 283,747 | | | | 107,771 | | | | 51,745 | |
| Class C | | | 839,051 | | | | 621,173 | | | | 551,133 | | | | 185,030 | |
| Class R-3 | | | 3,535 | | | | 1,574 | | | | 9 | | | | 33 | |
| Shareholder servicing fees | | | | | | | | | | | | | | | | |
| Class A | | | 817,160 | | | | 169,918 | | | | 80,064 | | | | 15,319 | |
| Class C | | | 149,481 | | | | 88,949 | | | | 103,678 | | | | 16,839 | |
| Class I | | | 21,599 | | | | 6,465 | | | | 192 | | | | 9,319 | |
| Class R-3 | | | 1,076 | | | | 414 | | | | 84 | | | | 31 | |
| Class R-5 | | | 20,800 | | | | 21 | | | | 22 | | | | 66 | |
| Fund accounting fees | | | 104,442 | | | | 103,199 | | | | 72,000 | | | | 72,046 | |
| Professional fees | | | 84,755 | | | | 93,151 | | | | 98,610 | | | | 38,444 | |
| State qualification expenses | | | 103,345 | | | | 90,322 | | | | 66,920 | | | | 16,602 | |
| Organizational costs | | | — | | | | — | | | | — | | | | 41,232 | |
| Offering costs | | | — | | | | — | | | | — | | | | 53,008 | |
| Reports to shareholders | | | 37,383 | | | | 13,390 | | | | 6,222 | | | | 4,235 | |
| Trustees and officers compensation | | | 39,979 | | | | 45,959 | | | | 45,855 | | | | 28,560 | |
| Custodian fees | | | 28,070 | | | | 33,409 | | | | 273,742 | | | | 5,595 | |
| Internal audit fees | | | 2,397 | | | | 2,397 | | | | 2,397 | | | | 1,484 | |
| Other | | | 22,580 | | | | 18,468 | | | | 14,708 | | | | 5,408 | |
| Total expenses before adjustments | | | 7,493,426 | | | | 2,811,268 | | | | 2,418,268 | | | | 736,003 | |
| Fees and expenses waived | | | — | | | | (1,078 | ) | | | (293,909 | ) | | | (249,023 | ) |
| Recovered fees previously waived by Manager | | | — | | | | 152,454 | | | | 1,133 | | | | — | |
| Expense offsets | | | (49 | ) | | | (44 | ) | | | (4 | ) | | | (100 | ) |
| Total expenses after adjustments | | | 7,493,377 | | | | 2,962,600 | | | | 2,125,488 | | | | 486,880 | |
| | | | |
| Net investment income (loss) | | | (1,445,633 | ) | | | 2,499,128 | | | | 35,268 | | | | 451,278 | |
| | | | |
| Realized and unrealized gain (loss) on investments | | | | | | | | | | | | | | | | |
| Net realized gain (loss) on investments | | | 39,004,380 | | | | 9,269,475 | | | | 6,638,065 | | | | 583,815 | |
| Net realized gain on foreign currency transactions (b) | | | — | | | | 22,462 | | | | 5,037,812 | | | | — | |
| Net change in unrealized appreciation on forward foreign currency contracts | | | — | | | | — | | | | 109,173 | | | | — | |
| Net change in unrealized appreciation (depreciation) on investments and other assets and liabilities denominated in foreign currencies | | | 39,015,018 | | | | 8,842,112 | | | | (3,461,843 | ) | | | 2,338,853 | |
| Net gain on investments | | | 78,019,398 | | | | 18,134,049 | | | | 8,323,207 | | | | 2,922,668 | |
| | | | |
Net increase in net assets
resulting from operations | | | 76,573,765 | | | | 20,633,177 | | | | 8,358,475 | | | | 3,373,946 | |
| | | | |
| (a) Net of foreign withholding taxes | | | $18,033 | | | | $434,144 | | | | $247,598 | | | | $ — | |
| | | | |
| (b) Includes Brazilian IOF tax of | | | — | | | | 95,841 | | | | 47,204 | | | | — | |
(c) For the period March 1, 2010 (commencement of operations) to October 31, 2010.
| | |
| 38 | | The accompanying notes are an integral part of the financial statements. |
Statements of Operations
| | | | | | | | | | | | | | | | | | |
Eagle
Large Cap
Core
Fund | | | Eagle
Mid Cap
Growth
Fund | | | Eagle
Mid Cap
Stock
Fund | | | Eagle
Small Cap
Core Value
Fund | | | Eagle
Small Cap
Growth
Fund | |
| | | | |
| | | | | | | | | | | | | | | | | | |
| | $2,132,445 | | | | $1,730,328 | | | | $12,507,209 | | | | $694,419 | | | | $2,904,240 | |
| | 3,518 | | | | 2,105 | | | | 7,209 | | | | 1,081 | | | | 4,586 | |
| | 2,135,963 | | | | 1,732,433 | | | | 12,514,418 | | | | 695,500 | | | | 2,908,826 | |
| | | | |
| | | | | | | | | | | | | | | | | | |
| | 801,106 | | | | 1,066,874 | | | | 7,924,818 | | | | 404,478 | | | | 2,370,823 | |
| | | | | | | | | | | | | | | | | | |
| | 16,675 | | | | 173,893 | | | | 1,213,992 | | | | 11,930 | | | | 354,295 | |
| | 13,963 | | | | 77,440 | | | | 356,313 | | | | 6,554 | | | | 99,012 | |
| | 113,069 | | | | 9,578 | | | | 318,653 | | | | 53,803 | | | | 52,610 | |
| | 3 | | | | 973 | | | | 4,963 | | | | 3 | | | | 2,390 | |
| | 21 | | | | 30 | | | | 65,271 | | | | 2 | | | | 38,675 | |
| | | | | | | | | | | | | | | | | | |
| | 27,792 | | | | 289,819 | | | | 2,023,379 | | | | 19,886 | | | | 590,505 | |
| | 93,085 | | | | 516,255 | | | | 2,375,485 | | | | 43,695 | | | | 660,094 | |
| | 10 | | | | 3,243 | | | | 16,543 | | | | 10 | | | | 7,965 | |
| | | | | | | | | | | | | | | | | | |
| | 17,376 | | | | 171,981 | | | | 1,655,928 | | | | 11,732 | | | | 512,208 | |
| | 22,259 | | | | 86,128 | | | | 451,623 | | | | 9,754 | | | | 136,864 | |
| | 344,530 | | | | 6,729 | | | | 320,650 | | | | 184,078 | | | | 36,570 | |
| | 18 | | | | 1,155 | | | | 5,733 | | | | 20 | | | | 3,265 | |
| | 69 | | | | 80 | | | | 58,097 | | | | 16 | | | | 31,967 | |
| | 96,868 | | | | 97,528 | | | | 109,724 | | | | 96,063 | | | | 100,352 | |
| | 79,281 | | | | 77,396 | | | | 77,394 | | | | 77,854 | | | | 77,397 | |
| | 73,013 | | | | 71,447 | | | | 109,882 | | | | 77,520 | | | | 82,290 | |
| | — | | | | — | | | | — | | | | — | | | | — | |
| | — | | | | — | | | | — | | | | — | | | | — | |
| | 18,067 | | | | 10,120 | | | | 98,027 | | | | 10,214 | | | | 25,278 | |
| | 45,883 | | | | 45,882 | | | | 45,872 | | | | 45,870 | | | | 45,883 | |
| | 5,756 | | | | 10,650 | | | | 77,498 | | | | 11,161 | | | | 23,605 | |
| | 2,397 | | | | 2,397 | | | | 2,397 | | | | 2,397 | | | | 2,397 | |
| | 14,662 | | | | 14,949 | | | | 39,341 | | | | 11,969 | | | | 18,491 | |
| | 1,785,903 | | | | 2,734,547 | | | | 17,351,583 | | | | 1,079,009 | | | | 5,272,936 | |
| | (350,624 | ) | | | (424 | ) | | | — | | | | (350,441 | ) | | | — | |
| | — | | | | — | | | | — | | | | — | | | | — | |
| | (16 | ) | | | (15 | ) | | | (232 | ) | | | (23 | ) | | | (67 | ) |
| | 1,435,263 | | | | 2,734,108 | | | | 17,351,351 | | | | 728,545 | | | | 5,272,869 | |
| | | | |
| | 700,700 | | | | (1,001,675 | ) | | | (4,836,933 | ) | | | (33,045 | ) | | | (2,364,043 | ) |
| | | | |
| | | | | | | | | | | | | | | | | | |
| | (687,281 | ) | | | 20,612,479 | | | | 188,681,537 | | | | 6,302,357 | | | | 27,149,881 | |
| | — | | | | — | | | | — | | | | — | | | | — | |
| | | | |
| | — | | | | — | | | | — | | | | — | | | | — | |
| | | | |
| | 12,221,695 | | | | 28,428,715 | | | | 67,597,572 | | | | 7,159,467 | | | | 89,359,536 | |
| | 11,534,414 | | | | 49,041,194 | | | | 256,279,109 | | | | 13,461,824 | | | | 116,509,417 | |
| | | | |
| | 12,235,114 | | | | 48,039,519 | | | | 251,442,176 | | | | 13,428,779 | | | | 114,145,374 | |
| | | | |
| | $4,021 | | | | $7,670 | | | | $147,156 | | | | $1,098 | | | | $12,246 | |
| | | | |
| | — | | | | — | | | | — | | | | — | | | | — | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 39 | |
Statements of Changes in Net Assets
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Eagle Capital Appreciation Fund | | | Eagle Growth & Income Fund | | | Eagle International Equity Fund | | | Eagle
Investment
Grade Bond
Fund | |
| | | 11/1/09 to
10/31/10 | | | 11/1/08 to
10/31/09 | | | 11/1/09 to
10/31/10 | | | 11/1/08 to
10/31/09 | | | 11/1/09 to
10/31/10 | | | 11/1/08 to
10/31/09 | | | 3/1/10 to
10/31/10(c) | |
| | | | | | | |
| Net assets, beginning of period | | | $486,558,402 | | | | $442,306,086 | | | | $141,502,238 | | | | $96,988,805 | | | | $117,155,129 | | | | $163,841,193 | | | | $ — | |
| Increase (decrease) in net assets from operations | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net investment income (loss) | | | (1,445,633 | ) | | | (1,782,603 | ) | | | 2,499,128 | | | | 2,971,034 | | | | 35,268 | | | | 911,426 | | | | 451,278 | |
| Net realized gain (loss) on investments | | | 39,004,380 | | | | (70,982,973 | ) | | | 9,269,475 | | | | (8,693,220 | ) | | | 6,638,065 | | | | (35,794,386 | ) | | | 583,815 | |
| Net realized gain (loss) on foreign currency transactions (b) | | | — | | | | — | | | | 22,462 | | | | (603,582 | ) | | | 5,037,812 | | | | 2,560,936 | | | | — | |
| Net change in unrealized appreciation (depreciation) on forward foreign currency contracts | | | — | | | | — | | | | — | | | | 3,493 | | | | 109,173 | | | | (5,581,811 | ) | | | — | |
| Net change in unrealized appreciation (depreciation) on investments and other assets and liabilities denominated in foreign currencies | | | 39,015,018 | | | | 151,709,769 | | | | 8,842,112 | | | | 28,119,220 | | | | (3,461,843 | ) | | | 47,618,859 | | | | 2,338,853 | |
| Net increase (decrease) in net assets resulting from operations | | | 76,573,765 | | | | 78,944,193 | | | | 20,633,177 | | | | 21,796,945 | | | | 8,358,475 | | | | 9,715,024 | | | | 3,373,946 | |
| Distributions to shareholders from | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Net investment income | | | — | | | | — | | | | (2,609,394 | ) | | | (3,030,927 | ) | | | — | | | | (5,314,007 | )(e) | | | (390,219 | ) |
| Net realized gains | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| Net distributions to shareholders | | | — | | | | — | | | | (2,609,394 | ) | | | (3,030,927 | ) | | | — | | | | (5,314,007 | ) | | | (390,219 | ) |
| Fund share transactions | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Proceeds from shares sold-Class A | | | 149,725,649 | | | | 91,862,409 | | | | 52,191,244 | | | | 34,047,379 | | | | 3,916,862 | | | | 10,034,646 | | | | 49,701,658 | |
| Issued as reinvestment of distributions-Class A | | | — | | | | — | | | | 1,603,407 | | | | 1,858,490 | | | | — | | | | 2,253,539 | | | | 197,353 | |
| Cost of shares redeemed-Class A | | | (106,706,998 | ) | | | (115,349,472 | ) | | | (27,342,629 | ) | | | (18,806,972 | ) | | | (22,989,844 | ) | | | (34,749,624 | ) | | | (3,621,289 | ) |
| Proceeds from shares sold-Class C | | | 4,868,915 | | | | 6,301,679 | | | | 24,447,566 | | | | 14,441,585 | | | | 1,816,635 | | | | 6,156,437 | | | | 49,411,156 | |
| Issued as reinvestment of distributions-Class C | | | — | | | | — | | | | 535,148 | | | | 844,172 | | | | — | | | | 2,610,913 | | | | 94,795 | |
| Cost of shares redeemed-Class C | | | (19,600,206 | ) | | | (21,927,284 | ) | | | (8,492,918 | ) | | | (8,666,716 | ) | | | (24,458,321 | ) | | | (37,662,224 | ) | | | (971,481 | ) |
| Proceeds from shares sold-Class I | | | 8,850,238 | | | | 9,920,860 | | | | 8,066,516 | | | | 1,765,651 | | | | 270,089 | | | | 1,258,426 | | | | 4,079,421 | |
| Issued as reinvestment of distributions-Class I | | | — | | | | — | | | | 30,336 | | | | 1,273 | | | | — | | | | — | | | | 8,584 | |
| Cost of shares redeemed-Class I | | | (13,574,129 | ) | | | (6,500,408 | ) | | | (1,945,750 | ) | | | (19,287 | ) | | | (8,139 | ) | | | (989,194 | ) | | | (234,297 | ) |
| Proceeds from shares sold-Class R-3 | | | 156,530 | | | | 388,778 | | | | 86,232 | | | | 280,032 | | | | 2,484 | | | | — | | | | 54,273 | |
| Issued as reinvestment of distributions-Class R-3 | | | — | | | | — | | | | 4,819 | | | | 1,808 | | | | — | | | | — | | | | 73 | |
| Cost of shares redeemed-Class R-3 | | | (293,981 | ) | | | (27,632 | ) | | | (4,332 | ) | | | — | | | | — | | | | — | | | | (2 | ) |
| Proceeds from shares sold-Class R-5 | | | 4,528,599 | | | | 5,356,787 | | | | 2,500 | | | | — | | | | 2,484 | | | | — | | | | 2,500 | |
| Issued as reinvestment of distributions-Class R-5 | | | — | | | | — | | | | 39 | | | | — | | | | — | | | | — | | | | 24 | |
| Cost of shares redeemed-Class R-5 | | | (4,621,326 | ) | | | (4,717,594 | ) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Net increase (decrease) from fund share transactions | | | 23,333,291 | | | | (34,691,877 | ) | | | 49,182,178 | | | | 25,747,415 | | | | (41,447,750 | ) | | | (51,087,081 | ) | | | 98,722,768 | |
| Increase (decrease) in net assets | | | 99,907,056 | | | | 44,252,316 | | | | 67,205,961 | | | | 44,513,433 | | | | (33,089,275 | ) | | | (46,686,064 | ) | | | 101,706,495 | |
| Net assets, end of period (a) | | | 586,465,458 | | | | 486,558,402 | | | | 208,708,199 | | | | 141,502,238 | | | | 84,065,854 | | | | 117,155,129 | | | | 101,706,495 | |
(a) Includes undistributed net investment income
(accumulated net investment loss) of: | | | $ — | | | | $ — | | | | $128,562 | | | | $219,598 | | | | $838,578 | | | | $(590,865 | ) | | | $202,877 | |
| (b) Includes Brazilian IOF tax of | | | $ — | | | | $ — | | | | $95,841 | | | | $ — | | | | $47,204 | | | | $ — | | | | $ — | |
| | | | | | | |
| Shares issued and redeemed | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Shares sold-Class A | | | 6,000,458 | | | | 5,009,360 | | | | 4,303,364 | | | | 3,291,400 | | | | 196,275 | | | | 595,758 | | | | 3,386,111 | |
| Issued as reinvestment of distributions-Class A | | | — | | | | — | | | | 129,429 | | | | 183,479 | | | | — | | | | 134,975 | | | | 13,300 | |
| Shares redeemed-Class A | | | (4,304,324 | ) | | | (6,544,041 | ) | | | (2,253,952 | ) | | | (1,977,699 | ) | | | (1,148,100 | ) | | | (2,127,606 | ) | | | (243,013 | ) |
| Shares sold-Class C | | | 223,275 | | | | 385,422 | | | | 2,065,409 | | | | 1,436,903 | | | | 99,989 | | | | 410,924 | | | | 3,356,355 | |
| Issued as reinvestment of distributions-Class C | | | — | | | | — | | | | 44,494 | | | | 86,176 | | | | — | | | | 171,305 | | | | 6,389 | |
| Shares redeemed-Class C | | | (906,784 | ) | | | (1,419,713 | ) | | | (725,189 | ) | | | (942,107 | ) | | | (1,355,217 | ) | | | (2,572,434 | ) | | | (64,913 | ) |
| Shares sold-Class I | | | 349,516 | | | | 497,775 | | | | 662,146 | | | | 164,656 | | | | 12,771 | | | | 79,132 | | | | 272,818 | |
| Issued as reinvestment of distributions-Class I | | | — | | | | — | | | | 2,436 | | | | 115 | | | | — | | | | — | | | | 572 | |
| Shares redeemed-Class I | | | (544,288 | ) | | | (392,848 | ) | | | (159,433 | ) | | | (1,760 | ) | | | (398 | ) | | | (71,652 | ) | | | (15,490 | ) |
| Shares sold-Class R-3 | | | 6,347 | | | | 19,689 | | | | 7,095 | | | | 23,654 | | | | 120 | | | | — | | | | 3,608 | |
| Issued as reinvestment of distributions-Class R-3 | | | — | | | | — | | | | 389 | | | | 150 | | | | — | | | | — | | | | 5 | |
| Shares redeemed-Class R-3 | | | (11,874 | ) | | | (1,427 | ) | | | (364 | ) | | | — | | | | — | | | | — | | | | — | |
| Shares sold-Class R-5 | | | 180,019 | | | | 280,379 | | | | 206 | | | | — | | | | 120 | | | | — | | | | 173 | |
| Issued as reinvestment of distributions-Class R-5 | | | — | | | | — | | | | 3 | | | | — | | | | — | | | | — | | | | 2 | |
| Shares redeemed-Class R-5 | | | (182,893 | ) | | | (255,618 | ) | | | — | | | | — | | | | — | | | | — | | | | — | |
| Shares issued and redeemed | | | 809,452 | | | | (2,421,022 | ) | | | 4,076,033 | | | | 2,264,967 | | | | (2,194,440 | ) | | | (3,379,598 | ) | | | 6,715,917 | |
(c) For the period March 1, 2010 (commencement of operations) to October 31, 2010. (d) For the period November 3, 2008 (commencement of operations) to October 31, 2009.
(e) Includes tax return of capital distributions of $186,860.
| | |
| 40 | | The accompanying notes are an integral part of the financial statements. |
Statements of Changes in Net Assets
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Eagle Large Cap Core Fund | | | Eagle Mid Cap Growth Fund | | | Eagle Mid Cap Stock Fund | | | Eagle Small Cap Core Value
Fund | | | Eagle Small Cap Growth Fund | |
11/1/09 to
10/31/10 | | | 11/1/08 to
10/31/09 | | | 11/1/09 to
10/31/10 | | | 11/1/08 to
10/31/09 | | | 11/1/09 to
10/31/10 | | | 11/1/08 to
10/31/09 | | | 11/1/09 to
10/31/10 | | | 11/3/08 to
10/31/09 (d) | | | 11/1/09 to
10/31/10 | | | 11/1/08 to
10/31/09 | |
| | | | | | | | | |
| | $124,850,857 | | | | $150,519,698 | | | | $146,725,344 | | | | $128,341,052 | | | | $1,360,595,478 | | | | $1,113,403,737 | | | | $57,833,435 | | | | $ — | | | | $312,128,302 | | | | $270,399,419 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 700,700 | | | | 1,247,380 | | | | (1,001,675 | ) | | | (1,054,090 | ) | | | (4,836,933 | ) | | | (2,912,750 | ) | | | (33,045 | ) | | | (55,546 | ) | | | (2,364,043 | ) | | | (2,451,734 | ) |
| | (687,281 | ) | | | (37,998,722 | ) | | | 20,612,479 | | | | (21,860,794 | ) | | | 188,681,537 | | | | (202,886,263 | ) | | | 6,302,357 | | | | 2,089,797 | | | | 27,149,881 | | | | (74,657,248 | ) |
| | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
|
— |
| | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
|
12,221,695 |
| | | 45,315,169 | | | | 28,428,715 | | | | 39,599,016 | | | | 67,597,572 | | | | 374,125,086 | | | | 7,159,467 | | | | 16,943,544 | | | | 89,359,536 | | | | 108,665,604 | |
|
12,235,114 |
| | | 8,563,827 | | | | 48,039,519 | | | | 16,684,132 | | | | 251,442,176 | | | | 168,326,073 | | | | 13,428,779 | | | | 18,977,795 | | | | 114,145,374 | | | | 31,556,622 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | (965,747 | ) | | | (2,233,573 | ) | | | — | | | | — | | | | — | | | | — | | | | (37,833 | ) | | | — | | | | — | | | | — | |
| | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | (2,027,828 | ) | | | — | | | | — | | | | — | |
| | (965,747 | ) | | | (2,233,573 | ) | | | — | | | | — | | | | — | | | | — | | | | (2,065,661 | ) | | | — | | | | — | | | | — | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 1,027,312 | | | | 1,923,879 | | | | 42,506,699 | | | | 25,224,739 | | | | 128,278,437 | | | | 197,579,460 | | | | 3,560,591 | | | | 5,090,916 | | | | 84,639,975 | | | | 58,304,739 | |
| | 47,259 | | | | 109,742 | | | | — | | | | — | | | | — | | | | — | | | | 189,893 | | | | — | | | | — | | | | — | |
| | (2,705,543 | ) | | | (4,005,927 | ) | | | (29,416,271 | ) | | | (26,840,300 | ) | | | (345,423,076 | ) | | | (262,214,770 | ) | | | (591,807 | ) | | | (418,935 | ) | | | (87,144,327 | ) | | | (64,602,948 | ) |
| | 905,568 | | | | 1,488,931 | | | | 7,613,282 | | | | 7,610,208 | | | | 17,601,208 | | | | 26,855,616 | | | | 1,500,430 | | | | 3,075,373 | | | | 6,678,857 | | | | 10,473,989 | |
| | — | | | | 10,057 | | | | — | | | | — | | | | — | | | | — | | | | 122,120 | | | | — | | | | — | | | | — | |
| | (2,152,862 | ) | | | (1,986,922 | ) | | | (8,856,506 | ) | | | (9,247,929 | ) | | | (51,757,572 | ) | | | (50,365,332 | ) | | | (539,109 | ) | | | (254,488 | ) | | | (13,128,650 | ) | | | (14,597,120 | ) |
| | 22,536,089 | | | | 26,464,887 | | | | 8,056,660 | | | | 4,840,895 | | | | 145,806,783 | | | | 190,159,453 | | | | 9,514,382 | | | | 39,324,515 | | | | 68,637,014 | | | | 8,594,439 | |
| | 876,556 | | | | 2,048,529 | | | | — | | | | — | | | | — | | | | — | | | | 1,689,028 | | | | — | | | | — | | | | — | |
| | (19,609,117 | ) | | | (58,057,505 | ) | | | (1,104,343 | ) | | | (227,262 | ) | | | (115,530,578 | ) | | | (48,229,911 | ) | | | (13,790,518 | ) | | | (7,961,741 | ) | | | (6,871,192 | ) | | | (2,361,747 | ) |
| | 2,500 | | | | — | | | | 1,142,226 | | | | 658,212 | | | | 2,091,376 | | | | 1,524,337 | | | | 2,500 | | | | — | | | | 603,283 | | | | 1,047,709 | |
| | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | — | | | | — | | | | (395,933 | ) | | | (318,403 | ) | | | (1,619,667 | ) | | | (597,213 | ) | | | — | | | | — | | | | (875,308 | ) | | | (764,144 | ) |
| | 1,943 | | | | 5,935 | | | | 146,459 | | | | — | | | | 12,675,639 | | | | 31,322,747 | | | | 2,500 | | | | — | | | | 13,651,306 | | | | 16,800,032 | |
| | 161 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | (95 | ) | | | (701 | ) | | | (1,716 | ) | | | — | | | | (13,076,126 | ) | | | (7,168,719 | ) | | | — | | | | — | | | | (6,603,609 | ) | | | (2,722,688 | ) |
| | 929,771 | | | | (31,999,095 | ) | | | 19,690,557 | | | | 1,700,160 | | | | (220,953,576 | ) | | | 78,865,668 | | | | 1,660,010 | | | | 38,855,640 | | | | 59,587,349 | | | | 10,172,261 | |
| | 12,199,138 | | | | (25,668,841 | ) | | | 67,730,076 | | | | 18,384,292 | | | | 30,488,600 | | | | 247,191,741 | | | | 13,023,128 | | | | 57,833,435 | | | | 173,732,723 | | | | 41,728,883 | |
| | 137,049,995 | | | | 124,850,857 | | | | 214,455,420 | | | | 146,725,344 | | | | 1,391,084,078 | | | | 1,360,595,478 | | | | 70,856,563 | | | | 57,833,435 | | | | 485,861,025 | | | | 312,128,302 | |
|
$526,041 |
| | | $791,088 | | | | $ — | | | | $ — | | | | $(208,006 | ) | | | $(208,006 | ) | | | $(39,979 | ) | | | $(35,942 | ) | | | $17,352 | | | | $108,984 | |
| | $ — | | | | $ — | | | | $ — | | | | $ — | | | | $ — | | | | $ — | | | | $ — | | | | $ — | | | | $ — | | | | $ — | |
| | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | 80,135 | | | | 191,197 | | | | 1,703,950 | | | | 1,368,513 | | | | 5,564,894 | | | | 11,101,355 | | | | 194,539 | | | | 373,694 | | | | 2,853,465 | | | | 2,712,594 | |
| | 3,799 | | | | 11,725 | | | | — | | | | — | | | | — | | | | — | | | | 11,021 | | | | — | | | | — | | | | — | |
| | (214,639 | ) | | | (409,849 | ) | | | (1,206,055 | ) | | | (1,484,342 | ) | | | (15,056,052 | ) | | | (15,158,025 | ) | | | (32,376 | ) | | | (31,652 | ) | | | (2,982,830 | ) | | | (3,111,128 | ) |
| | 71,178 | | | | 150,516 | | | | 342,670 | | | | 473,431 | | | | 864,380 | | | | 1,700,760 | | | | 82,648 | | | | 221,065 | | | | 264,656 | | | | 573,022 | |
| | — | | | | 1,080 | | | | — | | | | — | | | | — | | | | — | | | | 7,154 | | | | — | | | | — | | | | — | |
| | (171,619 | ) | | | (204,737 | ) | | | (403,429 | ) | | | (590,394 | ) | | | (2,546,052 | ) | | | (3,270,863 | ) | | | (29,832 | ) | | | (20,968 | ) | | | (527,246 | ) | | | (827,327 | ) |
| | 1,774,690 | | | | 2,646,440 | | | | 318,997 | | | | 243,373 | | | | 6,242,343 | | | | 10,215,374 | | | | 522,393 | | | | 3,474,664 | | | | 2,259,675 | | | | 426,895 | |
| | 70,690 | | | | 219,564 | | | | — | | | | — | | | | — | | | | — | | | | 97,688 | | | | — | | | | — | | | | — | |
| | (1,541,984 | ) | | | (6,252,510 | ) | | | (43,583 | ) | | | (11,653 | ) | | | (4,929,633 | ) | | | (2,603,066 | ) | | | (753,119 | ) | | | (527,803 | ) | | | (224,129 | ) | | | (109,368 | ) |
| | 196 | | | | — | | | | 45,180 | | | | 35,550 | | | | 90,539 | | | | 87,669 | | | | 140 | | | | — | | | | 20,780 | | | | 50,939 | |
| | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | — | | | | — | | | | (16,044 | ) | | | (16,601 | ) | | | (70,503 | ) | | | (32,777 | ) | | | — | | | | — | | | | (31,062 | ) | | | (34,513 | ) |
| | 148 | | | | 565 | | | | 5,738 | | | | — | | | | 533,966 | | | | 1,886,589 | | | | 140 | | | | — | | | | 457,000 | | | | 837,725 | |
| | 13 | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | | | | — | |
| | (7 | ) | | | (60 | ) | | | (67 | ) | | | — | | | | (553,223 | ) | | | (389,934 | ) | | | — | | | | — | | | | (220,826 | ) | | | (120,927 | ) |
| | 72,600 | | | | (3,646,069 | ) | | | 747,357 | | | | 17,877 | | | | (9,859,341 | ) | | | 3,537,082 | | | | 100,396 | | | | 3,489,000 | | | | 1,869,483 | | | | 397,912 | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 41 | |
Financial Highlights
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fiscal periods | | | | | | From investment operations | | | Dividends & distributions | | | | | | Ratios to average daily net assets (%) | | | | | | | | | | |
| | Beginning
net asset
value | | | Income
(loss) | | | Realized &
unrealized
gain (loss) | | | Total | | | From
investment
income | | | From
realized
gains | | | Total | | | Ending
net
asset
value | | | With
expenses
waived/
recovered | | | Without
expenses
waived/
recovered | | | Net
income
(loss) | | | Portfolio
turnover
rate (%) | | | Total
return (%) (a) | | | Ending
net
assets
(millions) | |
| Beginning | | Ending | | | | | | | | | | | | | | | |
| Eagle Capital Appreciation Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class A* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | $22.65 | | | | $(0.04) | | | | $3.63 | | | | $3.59 | | | | $— | | | | $— | | | | $— | | | | $26.24 | | | | 1.27 | | | | 1.27 | | | | (0.18 | ) | | | 45 | | | | 15.85 | | | | $469 | |
| 11/01/08 | | | 10/31/09 | | | | 18.58 | | | | (0.06 | ) | | | 4.13 | | | | 4.07 | | | | — | | | | — | | | | — | | | | 22.65 | | | | 1.32 | | | | 1.32 | | | | (0.31 | ) | | | 54 | | | | 21.91 | | | | 367 | |
| 11/01/07 | | | 10/31/08 | | | | 35.99 | | | | (0.13 | ) | | | (12.71 | ) | | | (12.84 | ) | | | — | | | | (4.57 | ) | | | (4.57 | ) | | | 18.58 | | | | 1.20 | | | | 1.20 | | | | (0.45 | ) | | | 61 | | | | (40.38 | ) | | | 329 | |
| 11/01/06 | | | 10/31/07 | | | | 29.67 | | | | 0.04 | | | | 6.46 | (b) | | | 6.50 | | | | — | | | | (0.18 | ) | | | (0.18 | ) | | | 35.99 | | | | 1.20 | | | | 1.20 | | | | 0.11 | | | | 62 | | | | 22.02 | | | | 566 | |
| 09/01/06 | | | 10/31/06 | (c) | | | 28.59 | | | | (0.01 | ) | | | 1.09 | (b) | | | 1.08 | | | | — | | | | — | | | | — | | | | 29.67 | | | | 1.23 | (d) | | | 1.23 | (d) | | | (0.19 | )(d) | | | 7 | | | | 3.78 | (e) | | | 387 | |
| 09/01/05 | | | 08/31/06 | | | | 26.28 | | | | (0.06 | ) | | | 2.37 | (b) | | | 2.31 | | | | — | | | | — | | | | — | | | | 28.59 | | | | 1.19 | | | | 1.19 | | | | (0.23 | ) | | | 58 | | | | 8.79 | | | | 378 | |
| Class C* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 19.90 | | | | (0.19 | ) | | | 3.17 | | | | 2.98 | | | | — | | | | — | | | | — | | | | 22.88 | | | | 1.99 | | | | 1.99 | | | | (0.91 | ) | | | 45 | | | | 14.97 | | | | 81 | |
| 11/01/08 | | | 10/31/09 | | | | 16.45 | | | | (0.18 | ) | | | 3.63 | | | | 3.45 | | | | — | | | | — | | | | — | | | | 19.90 | | | | 2.08 | | | | 2.08 | | | | (1.07 | ) | | | 54 | | | | 20.97 | | | | 84 | |
| 11/01/07 | | | 10/31/08 | | | | 32.64 | | | | (0.30 | ) | | | (11.32 | ) | | | (11.62 | ) | | | — | | | | (4.57 | ) | | | (4.57 | ) | | | 16.45 | | | | 1.95 | | | | 1.95 | | | | (1.19 | ) | | | 61 | | | | (40.85 | ) | | | 87 | |
| 11/01/06 | | | 10/31/07 | | | | 27.13 | | | | (0.19 | ) | | | 5.88 | (b) | | | 5.69 | | | | — | | | | (0.18 | ) | | | (0.18 | ) | | | 32.64 | | | | 1.96 | | | | 1.96 | | | | (0.65 | ) | | | 62 | | | | 21.09 | | | | 170 | |
| 09/01/06 | | | 10/31/06 | (c) | | | 26.17 | | | | (0.04 | ) | | | 1.00 | (b) | | | 0.96 | | | | — | | | | — | | | | — | | | | 27.13 | | | | 1.99 | (d) | | | 1.99 | (d) | | | (0.94 | )(d) | | | 7 | | | | 3.67 | (e) | | | 149 | |
| 09/01/05 | | | 08/31/06 | | | | 24.29 | | | | (0.25 | ) | | | 2.13 | (b) | | | 1.88 | | | | — | | | | — | | | | — | | | | 26.17 | | | | 1.94 | | | | 1.94 | | | | (0.98 | ) | | | 58 | | | | 7.74 | | | | 145 | |
| Class I* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 22.98 | | | | 0.04 | | | | 3.70 | | | | 3.74 | | | | — | | | | — | | | | — | | | | 26.72 | | | | 0.91 | | | | 0.91 | | | | 0.17 | | | | 45 | | | | 16.28 | | | | 11 | |
| 11/01/08 | | | 10/31/09 | | | | 18.78 | | | | 0.01 | | | | 4.19 | | | | 4.20 | | | | — | | | | — | | | | — | | | | 22.98 | | | | 0.94 | | | | 0.94 | | | | 0.07 | | | | 54 | | | | 22.36 | | | | 14 | |
| 11/01/07 | | | 10/31/08 | | | | 36.21 | | | | — | | | | (12.86 | ) | | | (12.86 | ) | | | — | | | | (4.57 | ) | | | (4.57 | ) | | | 18.78 | | | | 0.79 | | | | 0.79 | | | | (0.01 | ) | | | 61 | | | | (40.16 | ) | | | 10 | |
| 11/01/06 | | | 10/31/07 | | | | 29.73 | | | | 0.17 | | | | 6.49 | (b) | | | 6.66 | | | | — | | | | (0.18 | ) | | | (0.18 | ) | | | 36.21 | | | | 0.80 | | | | 0.80 | | | | 0.51 | | | | 62 | | | | 22.51 | | | | 51 | |
| 09/01/06 | | | 10/31/06 | (c) | | | 28.63 | | | | 0.01 | | | | 1.09 | (b) | | | 1.10 | | | | — | | | | — | | | | — | | | | 29.73 | | | | 0.85 | (d) | | | 0.85 | (d) | | | 0.20 | (d) | | | 7 | | | | 3.84 | (e) | | | 30 | |
| 03/21/06 | | | 08/31/06 | | | | 28.93 | | | | 0.01 | | | | (0.31 | )(b) | | | (0.30 | ) | | | — | | | | — | | | | — | | | | 28.63 | | | | 0.91 | (d) | | | 0.91 | (d) | | | 0.07 | (d) | | | 58 | | | | (1.04 | )(e) | | | 26 | |
| Class R-3* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 22.52 | | | | (0.10 | ) | | | 3.61 | | | | 3.51 | | | | — | | | | — | | | | — | | | | 26.03 | | | | 1.49 | | | | 1.49 | | | | (0.41 | ) | | | 45 | | | | 15.59 | | | | 1 | |
| 11/01/08 | | | 10/31/09 | | | | 18.51 | | | | (0.10 | ) | | | 4.11 | | | | 4.01 | | | | — | | | | — | | | | — | | | | 22.52 | | | | 1.49 | | | | 1.49 | | | | (0.51 | ) | | | 54 | | | | 21.66 | | | | 1 | |
| 11/01/07 | | | 10/31/08 | | | | 35.97 | | | | (0.20 | ) | | | (12.69 | ) | | | (12.89 | ) | | | — | | | | (4.57 | ) | | | (4.57 | ) | | | 18.51 | | | | 1.42 | | | | 1.42 | | | | (0.70 | ) | | | 61 | | | | (40.56 | ) | | | 0 | |
| 09/12/07 | | | 10/31/07 | | | | 33.30 | | | | (0.05 | ) | | | 2.72 | (b) | | | 2.67 | | | | — | | | | — | | | | — | | | | 35.97 | | | | 1.65 | (d) | | | 7.17 | (d) | | | (1.26 | )(d) | | | 62 | | | | 8.02 | (e) | | | 0 | |
| Class R-5* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 22.94 | | | | 0.06 | | | | 3.67 | | | | 3.73 | | | | — | | | | — | | | | — | | | | 26.67 | | | | 0.87 | | | | 0.87 | | | | 0.22 | | | | 45 | | | | 16.26 | | | | 24 | |
| 11/01/08 | | | 10/31/09 | | | | 18.73 | | | | 0.02 | | | | 4.19 | | | | 4.21 | | | | — | | | | — | | | | — | | | | 22.94 | | | | 0.87 | | | | 0.87 | | | | 0.12 | | | | 54 | | | | 22.48 | | | | 20 | |
| 11/01/07 | | | 10/31/08 | | | | 36.13 | | | | (0.04 | ) | | | (12.79 | ) | | | (12.83 | ) | | | — | | | | (4.57 | ) | | | (4.57 | ) | | | 18.73 | | | | 0.83 | | | | 0.83 | | | | (0.13 | ) | | | 61 | | | | (40.17 | ) | | | 16 | |
| 11/01/06 | | | 10/31/07 | | | | 29.68 | | | | 0.16 | | | | 6.47 | (b) | | | 6.63 | | | | — | | | | (0.18 | ) | | | (0.18 | ) | | | 36.13 | | | | 0.85 | | | | 0.85 | | | | 0.48 | | | | 62 | | | | 22.45 | | | | 12 | |
| 10/02/06 | | | 10/31/06 | | | | 29.04 | | | | — | | | | 0.64 | (b) | | | 0.64 | | | | — | | | | — | | | | — | | | | 29.68 | | | | 0.85 | (d) | | | 0.85 | (d) | | | (0.20 | )(d) | | | 7 | | | | 2.20 | (e) | | | 7 | |
| | | | | | | | | | | | | |
| Eagle Growth & Income Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class A* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 11.57 | | | | 0.20 | | | | 1.26 | | | | 1.46 | | | | (0.20 | ) | | | — | | | | (0.20 | ) | | | 12.83 | | | | 1.40 | | | | 1.30 | | | | 1.61 | | | | 50 | | | | 12.65 | | | | 128 | |
| 11/01/08 | | | 10/31/09 | | | | 9.71 | | | | 0.31 | | | | 1.86 | | | | 2.17 | | | | (0.31 | ) | | | — | | | | (0.31 | ) | | | 11.57 | | | | 1.39 | | | | 1.55 | | | | 3.12 | | | | 57 | | | | 22.88 | | | | 90 | |
| 11/01/07 | | | 10/31/08 | | | | 17.77 | | | | 0.37 | | | | (6.27 | ) | | | (5.90 | ) | | | (0.35 | ) | | | (1.81 | ) | | | (2.16 | ) | | | 9.71 | | | | 1.35 | | | | 1.33 | | | | 2.75 | | | | 64 | | | | (37.25 | ) | | | 61 | |
| 11/01/06 | | | 10/31/07 | | | | 14.68 | | | | 0.36 | | | | 3.60 | (b) | | | 3.96 | | | | (0.34 | ) | | | (0.53 | ) | | | (0.87 | ) | | | 17.77 | | | | 1.35 | | | | 1.40 | | | | 2.28 | | | | 63 | | | | 28.17 | | | | 96 | |
| 10/01/06 | | | 10/31/06 | (c) | | | 14.43 | | | | 0.02 | | | | 0.34 | (b) | | | 0.36 | | | | (0.11 | ) | | | — | | | | (0.11 | ) | | | 14,68 | | | | 1.35 | (d) | | | 1.56 | (d) | | | 1.33 | (d) | | | 4 | | | | 2.52 | (e) | | | 68 | |
| 10/01/05 | | | 09/30/06 | | | | 13.81 | | | | 0.38 | | | | 1.43 | (b) | | | 1.81 | | | | (0.34 | ) | | | (0.85 | ) | | | (1.19 | ) | | | 14.43 | | | | 1.35 | | | | 1.42 | | | | 2.74 | | | | 54 | | | | 13.90 | | | | 68 | |
| Class C* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 11.24 | | | | 0.11 | | | | 1.23 | | | | 1.34 | | | | (0.12 | ) | | | — | | | | (0.12 | ) | | | 12.46 | | | | 2.12 | | | | 2.05 | | | | 0.89 | | | | 50 | | | | 11.95 | | | | 72 | |
| 11/01/08 | | | 10/31/09 | | | | 9.45 | | | | 0.23 | | | | 1.80 | | | | 2.03 | | | | (0.24 | ) | | | — | | | | (0.24 | ) | | | 11.24 | | | | 2.19 | | | | 2.31 | | | | 2.35 | | | | 57 | | | | 21.89 | | | | 49 | |
| 11/01/07 | | | 10/31/08 | | | | 17.34 | | | | 0.26 | | | | (6.10 | ) | | | (5.84 | ) | | | (0.24 | ) | | | (1.81 | ) | | | (2.05 | ) | | | 9.45 | | | | 2.15 | | | | 2.09 | | | | 1.95 | | | | 64 | | | | (37.75 | ) | | | 36 | |
| 11/01/06 | | | 10/31/07 | | | | 14.38 | | | | 0.23 | | | | 3.50 | (b) | | | 3.73 | | | | (0.24 | ) | | | (0.53 | ) | | | (0.77 | ) | | | 17.34 | | | | 2.14 | | | | 2.16 | | | | 1.52 | | | | 63 | | | | 27.05 | | | | 59 | |
| 10/01/06 | | | 10/31/06 | (c) | | | 14.12 | | | | 0.01 | | | | 0.34 | (b) | | | 0.35 | | | | (0.09 | ) | | | — | | | | (0.09 | ) | | | 14.38 | | | | 2.10 | (d) | | | 2.31 | (d) | | | 0.58 | (d) | | | 4 | | | | 2.46 | (e) | | | 47 | |
| 10/01/05 | | | 09/30/06 | | | | 13.54 | | | | 0.27 | | | | 1.40 | (b) | | | 1.67 | | | | (0.24 | ) | | | (0.85 | ) | | | (1.09 | ) | | | 14.12 | | | | 2.10 | | | | 2.17 | | | | 2.00 | | | | 54 | | | | 13.01 | | | | 46 | |
| Class I* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 11.56 | | | | 0.29 | | | | 1.22 | | | | 1.51 | | | | (0.25 | ) | | | — | | | | (0.25 | ) | | | 12.82 | | | | 0.95 | | | | 0.97 | | | | 2.01 | | | | 50 | | | | 13.15 | | | | 9 | |
| 03/18/09 | | | 10/31/09 | | | | 8.43 | | | | 0.20 | | | | 3.20 | | | | 3.40 | | | | (0.27 | ) | | | — | | | | (0.27 | ) | | | 11.56 | | | | 0.95 | (d) | | | 1.12 | (d) | | | 3.08 | (d) | | | 57 | | | | 40.72 | (e) | | | 2 | |
| Class R-3* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 11.55 | | | | 0.18 | | | | 1.26 | | | | 1.44 | | | | (0.18 | ) | | | — | | | | (0.18 | ) | | | 12.81 | | | | 1.54 | | | | 1.54 | | | | 1.46 | | | | 50 | | | | 12.54 | | | | 0 | |
| 09/30/09 | | | 10/31/09 | | | | 11.84 | | | | 0.01 | | | | (0.22 | ) | | | (0.21 | ) | | | (0.08 | ) | | | — | | | | (0.08 | ) | | | 11.55 | | | | 1.65 | (d) | | | 1.56 | (d) | | | 0.94 | (d) | | | 57 | | | | (1.83 | )(e) | | | 0 | |
| | |
| 42 | | The accompanying notes are an integral part of the financial statements. |
Financial Highlights
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fiscal periods | | | | | | From investment operations | | | Dividends & distributions | | | | | | Ratios to average daily net assets (%) | | | | | | | | | | |
| | Beginning
net asset
value
| | | Income
(loss)
| | | Realized &
unrealized
gain (loss)
| | | Total | | | From
investment
income | | | From
realized
gains | | | Total | | | Ending
net
asset
value | | | With
expenses
waived/
recovered | | | Without
expenses
waived/
recovered | | | Net
income
(loss) | | | Portfolio
turnover
rate (%) | | | Total
return (%) (a) | | | Ending
net
assets
(millions) | |
| Beginning | | Ending | | | | | | | | | | | | | | | |
| Eagle Growth & Income Fund (cont’d) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class R-5 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 12/28/09 | | | 10/31/10 | | | | $12.11 | | | | $0.22 | | | | $0.69 | | | | $0.91 | | | | $(0.19 | ) | | | $— | | | | $(0.19 | ) | | | $12.83 | | | | 0.95 | (d) | | | 1.85 | (d) | | | 2.11 | (d) | | | 50 | | | | 7.53 | (e) | | | $0 | |
| | | | | | | | | | | | | |
| Eagle International Equity Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class A* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 19.52 | | | | 0.09 | | | | 1.89 | | | | 1.98 | | | | — | | | | — | | | | — | | | | 21.50 | | | | 1.74 | | | | 2.04 | | | | 0.46 | | | | 133 | | | | 10.14 | | | | 37 | |
| 11/01/08 | | | 10/31/09 | | | | 17.80 | | | | 0.20 | | | | 2.23 | | | | 2.43 | | | | (0.71 | ) (f) | | | — | | | | (0.71 | ) | | | 19.52 | | | | 1.70 | | | | 1.85 | | | | 1.18 | | | | 179 | | | | 14.34 | | | | 52 | |
| 11/01/07 | | | 10/31/08 | | | | 36.52 | | | | 0.32 | | | | (16.15 | ) | | | (15.83 | ) | | | — | | | | (2.89 | ) | | | (2.89 | ) | | | 17.80 | | | | 1.41 | | | | 1.41 | | | | 1.11 | | | | 115 | | | | (46.77 | ) | | | 73 | |
| 11/01/06 | | | 10/31/07 | | | | 29.97 | | | | 0.27 | | | | 8.87 | (b) | | | 9.14 | | | | (0.47 | ) | | | (2.12 | ) | | | (2.59 | ) | | | 36.52 | | | | 1.47 | | | | 1.41 | | | | 0.83 | | | | 56 | | | | 32.58 | | | | 166 | |
| 11/01/05 | | | 10/31/06 | | | | 25.20 | | | | 0.24 | | | | 6.73 | (b) | | | 6.97 | | | | (0.16 | ) | | | (2.04 | ) | | | (2.20 | ) | | | 29.97 | | | | 1.71 | | | | 1.53 | | | | 0.86 | | | | 58 | | | | 29.31 | | | | 91 | |
| Class C* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 17.68 | | | | (0.05 | ) | | | 1.69 | | | | 1.64 | | | | — | | | | — | | | | — | | | | 19.32 | | | | 2.49 | | | | 2.79 | | | | (0.30 | ) | | | 133 | | | | 9.28 | | | | 46 | |
| 11/01/08 | | | 10/31/09 | | | | 16.15 | | | | 0.06 | | | | 2.01 | | | | 2.07 | | | | (0.54 | ) (f) | | | — | | | | (0.54 | ) | | | 17.68 | | | | 2.48 | | | | 2.62 | | | | 0.39 | | | | 179 | | | | 13.34 | | | | 65 | |
| 11/01/07 | | | 10/31/08 | | | | 33.66 | | | | 0.09 | | | | (14.71 | ) | | | (14.62 | ) | | | — | | | | (2.89 | ) | | | (2.89 | ) | | | 16.15 | | | | 2.17 | | | | 2.17 | | | | 0.33 | | | | 115 | | | | (47.19 | ) | | | 91 | |
| 11/01/06 | | | 10/31/07 | | | | 27.85 | | | | 0.01 | | | | 8.23 | (b) | | | 8.24 | | | | (0.31 | ) | | | (2.12 | ) | | | (2.43 | ) | | | 33.66 | | | | 2.23 | | | | 2.17 | | | | 0.05 | | | | 56 | | | | 31.60 | | | | 189 | |
| 11/01/05 | | | 10/31/06 | | | | 23.58 | | | | 0.02 | | | | 6.30 | (b) | | | 6.32 | | | | (0.01 | ) | | | (2.04 | ) | | | (2.05 | ) | | | 27.85 | | | | 2.46 | | | | 2.28 | | | | 0.07 | | | | 58 | | | | 28.38 | | | | 118 | |
| Class I* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 19.57 | | | | 0.10 | | | | 2.00 | | | | 2.10 | | | | — | | | | — | | | | — | | | | 21.67 | | | | 1.15 | | | | 1.56 | | | | 0.53 | | | | 133 | | | | 10.73 | | | | 1 | |
| 03/13/09(g) | | | 10/31/09 | | | | 13.59 | | | | 0.08 | | | | 5.90 | | | | 5.98 | | | | — | | | | — | | | | — | | | | 19.57 | | | | 1.15 | (d) | | | 1.50 | (d) | | | 0.76 | (d) | | | 179 | | | | 44.00 | (e) | | | 0 | |
| 02/09/09 | | | 02/24/09 | (g) | | | 15.60 | | | | 0.02 | | | | (1.86 | ) | | | (1.84 | ) | | | — | | | | — | | | | — | | | | 13.76 | | | | 1.15 | (d) | | | 1.40 | (d) | | | 2.92 | (d) | | | 179 | | | | (11.79 | )(e) | | | 0 | |
| Class R-3* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 12/28/09 | | | 10/31/10 | | | | 20.80 | | | | (0.79 | ) | | | 0.94 | | | | 0.15 | | | | — | | | | — | | | | — | | | | 20.95 | | | | 1.74 | (d) | | | 3.18 | (d) | | | (4.66 | )(d) | | | 133 | | | | 0.72 | (e) | | | 0 | |
| Class R-5* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 12/28/09 | | | 10/31/10 | | | | 20.88 | | | | (0.07 | ) | | | 0.68 | | | | 0.61 | | | | — | | | | — | | | | — | | �� | | 21.49 | | | | 1.14 | (d) | | | 1.78 | (d) | | | (0.43 | )(d) | | | 133 | | | | 2.92 | (e) | | | 0 | |
| | | | | | | | | | | | | |
| Eagle Investment Grade Bond Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class A* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 03/01/10 | | | 10/31/10 | | | | 14.44 | | | | 0.16 | | | | 0.67 | | | | 0.83 | | | | (0.12 | ) | | | — | | | | (0.12 | ) | | | 15.15 | | | | 0.85 | (d) | | | 1.48 | (d) | | | 1.51 | (d) | | | 53 | | | | 5.78 | (e) | | | 48 | |
| Class C* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 03/01/10 | | | 10/31/10 | | | | 14.44 | | | | 0.07 | | | | 0.68 | | | | 0.75 | | | | (0.06 | ) | | | — | | | | (0.06 | ) | | | 15.13 | | | | 1.65 | (d) | | | 2.23 | (d) | | | 0.68 | (d) | | | 53 | | | | 5.23 | (e) | | | 50 | |
| Class I* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 03/01/10 | | | 10/31/10 | | | | 14.44 | | | | 0.16 | | | | 0.71 | | | | 0.87 | | | | (0.14 | ) | | | — | | | | (0.14 | ) | | | 15.17 | | | | 0.60 | (d) | | | 2.11 | (d) | | | 1.59 | (d) | | | 53 | | | | 6.05 | (e) | | | 4 | |
| Class R-3* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 03/01/10 | | | 10/31/10 | | | | 14.44 | | | | 0.05 | | | | 0.76 | | | | 0.81 | | | | (0.10 | ) | | | — | | | | (0.10 | ) | | | 15.15 | | | | 1.14 | (d) | | | 1.95 | (d) | | | 0.91 | (d) | | | 53 | | | | 5.63 | (e) | | | 0 | |
| Class R-5* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 03/01/10 | | | 10/31/10 | | | | 14.44 | | | | 0.18 | | | | 0.25 | | | | 0.43 | | | | (0.14 | ) | | | — | | | | (0.14 | ) | | | 14.73 | | | | 0.61 | (d) | | | 4.92 | (d) | | | 1.77 | (d) | | | 53 | | | | 2.97 | (e) | | | 0 | |
| | | | | | | | | | | | | |
| Eagle Large Cap Core Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class A* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 12.01 | | | | 0.04 | | | | 1.10 | | | | 1.14 | | | | (0.06 | ) | | | — | | | | (0.06 | ) | | | 13.09 | | | | 1.40 | | | | 1.41 | | | | 0.20 | | | | 48 | | | | 9.48 | | | | 10 | |
| 11/01/08 | | | 10/31/09 | | | | 10.70 | | | | 0.07 | | | | 1.36 | | | | 1.43 | | | | (0.12 | ) | | | — | | | | (0.12 | ) | | | 12.01 | | | | 1.38 | | | | 1.47 | | | | 0.68 | | | | 40 | | | | 13.68 | | | | 11 | |
| 11/01/07 | | | 10/31/08 | | | | 17.95 | | | | 0.17 | | | | (6.52 | ) | | | (6.35 | ) | | | (0.13 | ) | | | (0.77 | ) | | | (0.90 | ) | | | 10.70 | | | | 1.26 | | | | 1.26 | | | | 1.14 | | | | 43 | | | | (37.08 | ) | | | 12 | |
| 11/01/06 | | | 10/31/07 | | | | 16.54 | | | | 0.13 | | | | 1.48 | (b) | | | 1.61 | | | | (0.08 | ) | | | (0.12 | ) | | | (0.20 | ) | | | 17.95 | | | | 1.36 | | | | 1.28 | | | | 0.73 | | | | 45 | | | | 9.85 | | | | 27 | |
| 11/01/05 | | | 10/31/06 | | | | 14.29 | | | | 0.09 | | | | 2.16 | (b) | | | 2.25 | | | | — | | | | — | | | | — | | | | 16.54 | | | | 1.53 | | | | 1.52 | | | | 0.57 | | | | 43 | | | | 15.75 | | | | 23 | |
| Class C* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 11.86 | | | | (0.11 | ) | | | 1.13 | | | | 1.02 | | | | — | | | | — | | | | — | | | | 12.88 | | | | 2.20 | | | | 2.24 | | | | (0.60 | ) | | | 48 | | | | 8.60 | | | | 9 | |
| 11/01/08 | | | 10/31/09 | | | | 10.53 | | | | (0.01 | ) | | | 1.35 | | | | 1.34 | | | | (0.01 | ) | | | — | | | | (0.01 | ) | | | 11.86 | | | | 2.18 | | | | 2.32 | | | | (0.15 | ) | | | 40 | | | | 12.78 | | | | 9 | |
| 11/01/07 | | | 10/31/08 | | | | 17.68 | | | | 0.04 | | | | (6.42 | ) | | | (6.38 | ) | | | — | | | | (0.77 | ) | | | (0.77 | ) | | | 10.53 | | | | 2.10 | | | | 2.10 | | | | 0.28 | | | | 43 | | | | (37.58 | ) | | | 9 | |
| 11/01/06 | | | 10/31/07 | | | | 16.35 | | | | (0.02 | ) | | | 1.47 | (b) | | | 1.45 | | | | — | | | | (0.12 | ) | | | (0.12 | ) | | | 17.68 | | | | 2.18 | | | | 2.11 | | | | (0.10 | ) | | | 45 | | | | 8.95 | | | | 17 | |
| 11/01/05 | | | 10/31/06 | | | | 14.23 | | | | (0.03 | ) | | | 2.15 | (b) | | | 2.12 | | | | — | | | | — | | | | — | | | | 16.35 | | | | 2.28 | | | | 2.27 | | | | (0.19 | ) | | | 43 | | | | 14.90 | | | | 15 | |
| Class I* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 12.02 | | | | 0.13 | | | | 1.05 | | | | 1.18 | | | | (0.10 | ) | | | — | | | | (0.10 | ) | | | 13.10 | | | | 0.95 | | | | 1.26 | | | | 0.65 | | | | 48 | | | | 9.90 | | | | 118 | |
| 11/01/08 | | | 10/31/09 | | | | 10.73 | | | | 0.12 | | | | 1.35 | | | | 1.47 | | | | (0.18 | ) | | | — | | | | (0.18 | ) | | | 12.02 | | | | 0.95 | | | | 1.28 | | | | 1.18 | | | | 40 | | | | 14.20 | | | | 104 | |
| 11/01/07 | | | 10/31/08 | | | | 18.01 | | | | 0.20 | | | | (6.51 | ) | | | (6.31 | ) | | | (0.20 | ) | | | (0.77 | ) | | | (0.97 | ) | | | 10.73 | | | | 0.95 | | | | 1.04 | | | | 1.39 | | | | 43 | | | | (36.86 | ) | | | 130 | |
| 11/01/06 | | | 10/31/07 | | | | 16.60 | | | | 0.19 | | | | 1.48 | (b) | | | 1.67 | | | | (0.14 | ) | | | (0.12 | ) | | | (0.26 | ) | | | 18.01 | | | | 0.95 | | | | 1.06 | | | | 1.12 | | | | 45 | | | | 10.22 | | | | 183 | |
| 03/03/06 | | | 10/31/06 | | | | 15.17 | | | | 0.08 | | | | 1.35 | (b) | | | 1.43 | | | | — | | | | — | | | | — | | | | 16.60 | | | | 0.95 | (d) | | | 1.23 | (d) | | | 0.87 | (d) | | | 43 | | | | 9.43 | (e) | | | 128 | |
| Class R-3* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 12/28/09 | | | 10/31/10 | | | | 12.77 | | | | (0.01 | ) | | | 0.30 | | | | 0.29 | | | | — | | | | — | | | | — | | | | 13.06 | | | | 1.65 | (d) | | | 2.39 | (d) | | | (0.13 | )(d) | | | 48 | | | | 2.27 | (e) | | | 0 | |
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 43 | |
Financial Highlights
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fiscal periods | | | | | | From investment operations | | | Dividends & distributions | | | | | | Ratios to average daily net assets (%) | | | | | | | | | | |
| | Beginning
net asset
value | | | Income
(loss) | | | Realized &
unrealized
gain (loss) | | | Total | | | From
investment
income | | | From
realized
gains | | | Total | | | Ending
net
asset
value | | | With
expenses
waived/
recovered | | | Without
expenses
waived/
recovered | | | Net
income
(loss) | | | Portfolio
turnover
rate (%) | | | Total
return (%) (a) | | | Ending
net
assets
(millions) | |
| Beginning | | Ending | | | | | | | | | | | | | | | |
| Eagle Large Cap Core Fund (cont’d) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class R-5* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | $12.28 | | | | $0.11 | | | | $1.11 | | | | $1.22 | | | | $(0.11) | | | | $— | | | | $(0.11) | | | | $13.39 | | | | 0.95 | | | | 1.28 | | | | 0.65 | | | | 48 | | | | 9.94 | | | | $0 | |
| 11/01/08 | | | 10/31/09 | | | | 10.76 | | | | 0.11 | | | | 1.41 | | | | 1.52 | | | | — | | | | — | | | | — | | | | 12.28 | | | | 0.95 | | | | 1.22 | | | | 0.97 | | | | 40 | | | | 14.13 | | | | 0 | |
| 11/01/07 | | | 10/31/08 | | | | 17.98 | | | | 0.27 | | | | (6.51 | ) | | | (6.24 | ) | | | (0.21 | ) | | | (0.77 | ) | | | (0.98 | ) | | | 10.76 | | | | 0.86 | | | | 0.90 | | | | 1.71 | | | | 43 | | | | (36.52 | ) | | | 0 | |
| 04/02/07 | | | 10/31/07 | | | | 16.51 | | | | — | | | | 1.47 | (b) | | | 1.47 | | | | — | | | | — | | | | — | | | | 17.98 | | | | 0.91 | (d) | | | 0.91 | (d) | | | 0.05 | (d) | | | 45 | | | | 8.90 | (e) | | | 1 | |
| | | | | | | | | | | | | |
| Eagle Mid Cap Growth Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class A* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 21.25 | | | | (0.09 | ) | | | 6.87 | | | | 6.78 | | | | — | | | | — | | | | — | | | | 28.03 | | | | 1.33 | | | | 1.33 | | | | (0.36 | ) | | | 96 | | | | 31.91 | | | | 140 | |
| 11/01/08 | | | 10/31/09 | | | | 18.63 | | | | (0.11 | ) | | | 2.73 | | | | 2.62 | | | | — | | | | — | | | | — | | | | 21.25 | | | | 1.44 | | | | 1.44 | | | | (0.59 | ) | | | 127 | | | | 14.06 | | | | 95 | |
| 11/01/07 | | | 10/31/08 | | | | 34.48 | | | | (0.20 | ) | | | (10.29 | ) | | | (10.49 | ) | | | — | | | | (5.36 | ) | | | (5.36 | ) | | | 18.63 | | | | 1.30 | | | | 1.30 | | | | (0.74 | ) | | | 141 | | | | (35.68 | ) | | | 86 | |
| 11/01/06 | | | 10/31/07 | | | | 28.11 | | | | (0.24 | ) | | | 9.18 | (b) | | | 8.94 | | | | — | | | | (2.57 | ) | | | (2.57 | ) | | | 34.48 | | | | 1.36 | | | | 1.36 | | | | (0.80 | ) | | | 98 | | | | 34.28 | | | | 130 | |
| 11/01/05 | | | 10/31/06 | | | | 26.72 | | | | (0.14 | ) | | | 2.95 | (b) | | | 2.81 | | | | — | | | | (1.42 | ) | | | (1.42 | ) | | | 28.11 | | | | 1.29 | | | | 1.29 | | | | (0.49 | ) | | | 111 | | | | 10.70 | | | | 135 | |
| Class C* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 18.88 | | | | (0.24 | ) | | | 6.07 | | | | 5.83 | | | | — | | | | — | | | | — | | | | 24.71 | | | | 2.10 | | | | 2.10 | | | | (1.11 | ) | | | 96 | | | | 30.88 | | | | 58 | |
| 11/01/08 | | | 10/31/09 | | | | 16.68 | | | | (0.23 | ) | | | 2.43 | | | | 2.20 | | | | — | | | | — | | | | — | | | | 18.88 | | | | 2.22 | | | | 2.22 | | | | (1.36 | ) | | | 127 | | | | 13.19 | | | | 45 | |
| 11/01/07 | | | 10/31/08 | | | | 31.65 | | | | (0.36 | ) | | | (9.25 | ) | | | (9.61 | ) | | | — | | | | (5.36 | ) | | | (5.36 | ) | | | 16.68 | | | | 2.05 | | | | 2.05 | | | | (1.48 | ) | | | 141 | | | | (36.16 | ) | | | 42 | |
| 11/01/06 | | | 10/31/07 | | | | 26.18 | | | | (0.42 | ) | | | 8.46 | (b) | | | 8.04 | | | | — | | | | (2.57 | ) | | | (2.57 | ) | | | 31.65 | | | | 2.11 | | | | 2.11 | | | | (1.54 | ) | | | 98 | | | | 33.28 | | | | 69 | |
| 11/01/05 | | | 10/31/06 | | | | 25.15 | | | | (0.32 | ) | | | 2.77 | (b) | | | 2.45 | | | | — | | | | (1.42 | ) | | | (1.42 | ) | | | 26.18 | | | | 2.04 | | | | 2.04 | | | | (1.23 | ) | | | 111 | | | | 9.90 | | | | 64 | |
| Class I* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 21.58 | | | | (0.02 | ) | | | 7.02 | | | | 7.00 | | | | — | | | | — | | | | — | | | | 28.58 | | | | 0.95 | | | | 0.95 | | | | (0.07 | ) | | | 96 | | | | 32.44 | | | | 15 | |
| 11/01/08 | | | 10/31/09 | | | | 18.83 | | | | (0.02 | ) | | | 2.77 | | | | 2.75 | | | | — | | | | — | | | | — | | | | 21.58 | | | | 0.95 | | | | 1.05 | | | | (0.13 | ) | | | 127 | | | | 14.60 | | | | 6 | |
| 11/01/07 | | | 10/31/08 | | | | 34.69 | | | | (0.12 | ) | | | (10.38 | ) | | | (10.50 | ) | | | — | | | | (5.36 | ) | | | (5.36 | ) | | | 18.83 | | | | 0.95 | | | | 1.04 | | | | (0.54 | ) | | | 141 | | | | (35.46 | ) | | | 0 | |
| 11/01/06 | | | 10/31/07 | | | | 28.16 | | | | (0.11 | ) | | | 9.21 | (b) | | | 9.10 | | | | — | | | | (2.57 | ) | | | (2.57 | ) | | | 34.69 | | | | 0.95 | | | | 1.08 | | | | (0.37 | ) | | | 98 | | | | 34.83 | | | | 0 | |
| 06/21/06 | | | 10/31/06 | | | | 26.63 | | | | (0.04 | ) | | | 1.57 | (b) | | | 1.53 | | | | — | | | | — | | | | — | | | | 28.16 | | | | 0.95 | (d) | | | 1.05 | (d) | | | (0.42 | )(d) | | | 111 | | | | 5.75 | (e) | | | 0 | |
| Class R-3* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 21.19 | | | | (0.19 | ) | | | 6.88 | | | | 6.69 | | | | — | | | | — | | | | — | | | | 27.88 | | | | 1.61 | | | | 1.61 | | | | (0.72 | ) | | | 96 | | | | 31.57 | | | | 1 | |
| 01/12/09 | | | 10/31/09 | | | | 16.84 | | | | (0.15 | ) | | | 4.50 | | | | 4.35 | | | | — | | | | — | | | | — | | | | 21.19 | | | | 1.74 | (d) | | | 1.74 | (d) | | | (0.94 | )(d) | | | 127 | | | | 25.83 | (e) | | | 0 | |
| Class R-5* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 12/28/09 | | | 10/31/10 | | | | 24.70 | | | | (0.12 | ) | | | 3.98 | | | | 3.86 | | | | — | | | | — | | | | — | | | | 28.56 | | | | 0.95 | (d) | | | 1.15 | (d) | | | (0.44 | )(d) | | | 96 | | | | 15.63 | (e) | | | 0 | |
| | | | | | | | | | | | | |
| Eagle Mid Cap Stock Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class A* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 21.10 | | | | (0.07 | ) | | | 4.34 | | | | 4.27 | | | | — | | | | — | | | | — | | | | 25.37 | | | | 1.20 | | | | 1.20 | | | | (0.32 | ) | | | 245 | | | | 20.24 | | | | 736 | |
| 11/01/08 | | | 10/31/09 | | | | 18.34 | | | | (0.03 | ) | | | 2.79 | | | | 2.76 | | | | — | | | | — | | | | — | | | | 21.10 | | | | 1.26 | | | | 1.26 | | | | (0.18 | ) | | | 196 | | | | 15.05 | | | | 812 | |
| 11/01/07 | | | 10/31/08 | | | | 32.59 | | | | (0.09 | ) | | | (10.83 | ) | | | (10.92 | ) | | | — | | | | (3.33 | ) | | | (3.33 | ) | | | 18.34 | | | | 1.15 | | | | 1.15 | | | | (0.34 | ) | | | 176 | | | | (37.04 | ) | | | 780 | |
| 11/01/06 | | | 10/31/07 | | | | 30.12 | | | | (0.06 | ) | | | 5.61 | (b) | | | 5.55 | | | | — | | | | (3.08 | ) | | | (3.08 | ) | | | 32.59 | | | | 1.13 | | | | 1.13 | | | | (0.18 | ) | | | 185 | | | | 20.08 | | | | 1,312 | |
| 11/01/05 | | | 10/31/06 | | | | 27.79 | | | | (0.10 | ) | | | 4.39 | (b) | | | 4.29 | | | | — | | | | (1.96 | ) | | | (1.96 | ) | | | 30.12 | | | | 1.13 | | | | 1.13 | | | | (0.35 | ) | | | 180 | | | | 16.18 | | | | 904 | |
| Class C* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 18.67 | | | | (0.21 | ) | | | 3.82 | | | | 3.61 | | | | — | | | | — | | | | — | | | | 22.28 | | | | 1.93 | | | | 1.93 | | | | (1.06 | ) | | | 245 | | | | 19.34 | | | | 239 | |
| 11/01/08 | | | 10/31/09 | | | | 16.34 | | | | (0.15 | ) | | | 2.48 | | | | 2.33 | | | | — | | | | — | | | | — | | | | 18.67 | | | | 2.00 | | | | 2.00 | | | | (0.93 | ) | | | 196 | | | | 14.26 | | | | 232 | |
| 11/01/07 | | | 10/31/08 | | | | 29.62 | | | | (0.25 | ) | | | (9.70 | ) | | | (9.95 | ) | | | — | | | | (3.33 | ) | | | (3.33 | ) | | | 16.34 | | | | 1.88 | | | | 1.88 | | | | (1.07 | ) | | | 176 | | | | (37.53 | ) | | | 229 | |
| 11/01/06 | | | 10/31/07 | | | | 27.83 | | | | (0.26 | ) | | | 5.13 | (b) | | | 4.87 | | | | — | | | | (3.08 | ) | | | (3.08 | ) | | | 29.62 | | | | 1.88 | | | | 1.88 | | | | (0.94 | ) | | | 185 | | | | 19.21 | | | | 410 | |
| 11/01/05 | | | 10/31/06 | | | | 26.00 | | | | (0.29 | ) | | | 4.08 | (b) | | | 3.79 | | | | — | | | | (1.96 | ) | | | (1.96 | ) | | | 27.83 | | | | 1.88 | | | | 1.88 | | | | (1.10 | ) | | | 180 | | | | 15.31 | | | | 345 | |
| Class I* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 21.36 | | | | 0.01 | | | | 4.42 | | | | 4.43 | | | | — | | | | — | | | | — | | | | 25.79 | | | | 0.79 | | | | 0.79 | | | | 0.06 | | | | 245 | | | | 20.74 | | | | 340 | |
| 11/01/08 | | | 10/31/09 | | | | 18.49 | | | | 0.03 | | | | 2.84 | | | | 2.87 | | | | — | | | | — | | | | — | | | | 21.36 | | | | 0.87 | | | | 0.87 | | | | 0.16 | | | | 196 | | | | 15.52 | | | | 254 | |
| 11/01/07 | | | 10/31/08 | | | | 32.74 | | | | — | | | | (10.92 | ) | | | (10.92 | ) | | | — | | | | (3.33 | ) | | | (3.33 | ) | | | 18.49 | | | | 0.81 | | | | 0.81 | | | | (0.02 | ) | | | 176 | | | | (36.85 | ) | | | 79 | |
| 11/01/06 | | | 10/31/07 | | | | 30.15 | | | | 0.05 | | | | 5.62 | (b) | | | 5.67 | | | | — | | | | (3.08 | ) | | | (3.08 | ) | | | 32.74 | | | | 0.81 | | | | 0.81 | | | | 0.17 | | | | 185 | | | | 20.50 | | | | 94 | |
| 06/06/06 | | | 10/31/06 | | | | 28.21 | | | | (0.01 | ) | | | 1.95 | (b) | | | 1.94 | | | | — | | | | — | | | | — | | | | 30.15 | | | | 0.84 | (d) | | | 0.84 | (d) | | | (0.15 | )(d) | | | 180 | | | | 6.88 | (e) | | | 17 | |
| Class R-3* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 20.98 | | | | (0.13 | ) | | | 4.32 | | | | 4.19 | | | | — | | | | — | | | | — | | | | 25.17 | | | | 1.41 | | | | 1.41 | | | | (0.57 | ) | | | 245 | | | | 19.97 | | | | 4 | |
| 11/01/08 | | | 10/31/09 | | | | 18.26 | | | | (0.06 | ) | | | 2.78 | | | | 2.72 | | | | — | | | | — | | | | — | | | | 20.98 | | | | 1.40 | | | | 1.40 | | | | (0.35 | ) | | | 196 | | | | 14.90 | | | | 3 | |
| 11/01/07 | | | 10/31/08 | | | | 32.52 | | | | (0.13 | ) | | | (10.80 | ) | | | (10.93 | ) | | | — | | | | (3.33 | ) | | | (3.33 | ) | | | 18.26 | | | | 1.33 | | | | 1.33 | | | | (0.53 | ) | | | 176 | | | | (37.16 | ) | | | 1 | |
| 11/01/06 | | | 10/31/07 | | | | 30.10 | | | | (0.10 | ) | | | 5.60 | (b) | | | 5.50 | | | | — | | | | (3.08 | ) | | | (3.08 | ) | | | 32.52 | | | | 1.29 | | | | 1.29 | | | | (0.33 | ) | | | 185 | | | | 19.91 | | | | 1 | |
| 08/10/06 | | | 10/31/06 | | | | 27.82 | | | | (0.04 | ) | | | 2.32 | (b) | | | 2.28 | | | | — | | | | — | | | | — | | | | 30.10 | | | | 1.27 | (d) | | | 1.27 | (d) | | | (0.60 | )(d) | | | 180 | | | | 8.20 | (e) | | | 0 | |
| Class R-5* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 21.39 | | | | 0.02 | | | | 4.42 | | | | 4.44 | | | | — | | | | — | | | | — | | | | 25.83 | | | | 0.78 | | | | 0.78 | | | | 0.09 | | | | 245 | | | | 20.76 | | | | 72 | |
| 11/01/08 | | | 10/31/09 | | | | 18.50 | | | | 0.05 | | | | 2.84 | | | | 2.89 | | | | — | | | | — | | | | — | | | | 21.39 | | | | 0.79 | | | | 0.79 | | | | 0.28 | | | | 196 | | | | 15.62 | | | | 60 | |
| 11/01/07 | | | 10/31/08 | | | | 32.73 | | | | 0.02 | | | | (10.92 | ) | | | (10.90 | ) | | | — | | | | (3.33 | ) | | | (3.33 | ) | | | 18.50 | | | | 0.74 | | | | 0.74 | | | | 0.06 | | | | 176 | | | | (36.80 | ) | | | 24 | |
| 11/01/06 | | | 10/31/07 | | | | 30.13 | | | | 0.07 | | | | 5.61 | (b) | | | 5.68 | | | | — | | | | (3.08 | ) | | | (3.08 | ) | | | 32.73 | | | | 0.75 | | | | 0.75 | | | | 0.23 | | | | 185 | | | | 20.55 | | | | 34 | |
| 10/02/06 | | | 10/31/06 | | | | 28.96 | | | | — | | | | 1.17 | (b) | | | 1.17 | | | | — | | | | — | | | | — | | | | 30.13 | | | | 0.67 | (d) | | | 0.67 | (d) | | | (0.15 | )(d) | | | 180 | | | | 4.04 | (e) | | | 12 | |
| | |
| 44 | | The accompanying notes are an integral part of the financial statements. |
Financial Highlights
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Fiscal periods | | | | | | From investment operations | | | Dividends & distributions | | | | | | Ratios to average daily net assets (%) | | | | | | | | | | |
| | Beginning
net asset
value | | | Income
(loss) | | | Realized &
unrealized
gain (loss) | | | Total | | | From
investment
income | | | From
realized
gains | | | Total | | | Ending
net
asset
value | | | With
expenses
waived/
recovered | | | Without
expenses
waived/
recovered | | | Net
income
(loss) | | | Portfolio
turnover
rate (%) | | | Total
return (%) (a) | | | Ending
net
assets
(millions) | |
| Beginning | | Ending | | | | | | | | | | | | | | | |
| Eagle Small Cap Core Value Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class A* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | $16.54 | | | | $(0.09 | ) | | | $3.75 | | | | $3.66 | | | | $— | | | | $(0.57 | ) | | | $(0.57 | ) | | | $19.63 | | | | 1.50 | | | | 1.67 | | | | (0.46 | ) | | | 22 | | | | 22.63 | | | | $10 | |
| 11/03/08 | | | 10/31/09 | | | | 14.29 | | | | (0.07 | ) | | | 2.32 | | | | 2.25 | | | | — | | | | — | | | | — | | | | 16.54 | | | | 1.48 | (d) | | | 4.53 | (d) | | | (0.45 | )(d) | | | 23 | | | | 15.75 | (e) | | | 6 | |
| Class C* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 16.41 | | | | (0.23 | ) | | | 3.71 | | | | 3.48 | | | | — | | | | (0.57 | ) | | | (0.57 | ) | | | 19.32 | | | | 2.30 | | | | 2.49 | | | | (1.25 | ) | | | 22 | | | | 21.69 | | | | 5 | |
| 11/03/08 | | | 10/31/09 | | | | 14.29 | | | | (0.19 | ) | | | 2.31 | | | | 2.12 | | | | — | | | | — | | | | — | | | | 16.41 | | | | 2.28 | (d) | | | 5.37 | (d) | | | (1.27 | )(d) | | | 23 | | | | 14.84 | (e) | | | 3 | |
| Class I* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 16.59 | | | | 0.02 | | | | 3.77 | | | | 3.79 | | | | (0.01 | ) | | | (0.57 | ) | | | (0.58 | ) | | | 19.80 | | | | 0.95 | | | | 1.56 | | | | 0.11 | | | | 22 | | | | 23.39 | | | | 56 | |
| 03/09/09 | | | 10/31/09 | | | | 9.65 | | | | (0.01 | ) | | | 6.95 | | | | 6.94 | | | | — | | | | — | | | | — | | | | 16.59 | | | | 0.95 | (d) | | | 1.80 | (d) | | | (0.04 | )(d) | | | 23 | | | | 71.92 | (e) | | | 49 | |
| Class R-3* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 12/28/09 | | | 10/31/10 | | | | 17.86 | | | | (0.11 | ) | | | 1.85 | | | | 1.74 | | | | — | | | | — | | | | — | | | | 19.60 | | | | 1.71 | (d) | | | 2.68 | (d) | | | (0.69 | )(d) | | | 22 | | | | 9.74 | (e) | | | 0 | |
| Class R-5* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 12/28/09 | | | 10/31/10 | | | | 17.92 | | | | 0.01 | | | | 1.86 | | | | 1.87 | | | | — | | | | — | | | | — | | | | 19.79 | | | | 0.97 | (d) | | | 1.96 | (d) | | | 0.05 | (d) | | | 22 | | | | 10.44 | (e) | | | 0 | |
| | | | | | | | | | | | | |
| Eagle Small Cap Growth Fund | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Class A* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 25.10 | | | | (0.16 | ) | | | 8.85 | | | | 8.69 | | | | — | | | | — | | | | — | | | | 33.79 | | | | 1.31 | | | | 1.31 | | | | (0.55 | ) | | | 49 | | | | 34.62 | | | | 266 | |
| 11/01/08 | | | 10/31/09 | | | | 22.52 | | | | (0.18 | ) | | | 2.76 | | | | 2.58 | | | | — | | | | — | | | | — | | | | 25.10 | | | | 1.37 | | | | 1.37 | | | | (0.83 | ) | | | 110 | | | | 11.46 | | | | 200 | |
| 11/01/07 | | | 10/31/08 | | | | 41.33 | | | | (0.16 | ) | | | (12.81 | ) | | | (12.97 | ) | | | — | | | | (5.84 | ) | | | (5.84 | ) | | | 22.52 | | | | 1.27 | | | | 1.27 | | | | (0.50 | ) | | | 51 | | | | (35.81 | ) | | | 189 | |
| 11/01/06 | | | 10/31/07 | | | | 37.87 | | | | (0.15 | ) | | | 6.46 | (b) | | | 6.31 | | | | — | | | | (2.85 | ) | | | (2.85 | ) | | | 41.33 | | | | 1.25 | | | | 1.25 | | | | (0.38 | ) | | | 64 | | | | 17.65 | | | | 327 | |
| 11/01/05 | | | 10/31/06 | | | | 32.93 | | | | (0.15 | ) | | | 6.23 | (b) | | | 6.08 | | | | — | | | | (1.14 | ) | | | (1.14 | ) | | | 37.87 | | | | 1.24 | | | | 1.24 | | | | (0.43 | ) | | | 49 | | | | 18.89 | | | | 269 | |
| Class C* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 21.44 | | | | (0.31 | ) | | | 7.52 | | | | 7.21 | | | | — | | | | — | | | | — | | | | 28.65 | | | | 2.05 | | | | 2.05 | | | | (1.25 | ) | | | 49 | | | | 33.63 | | | | 72 | |
| 11/01/08 | | | 10/31/09 | | | | 19.40 | | | | (0.30 | ) | | | 2.34 | | | | 2.04 | | | | — | | | | — | | | | — | | | | 21.44 | | | | 2.17 | | | | 2.17 | | | | (1.63 | ) | | | 110 | | | | 10.52 | | | | 60 | |
| 11/01/07 | | | 10/31/08 | | | | 36.69 | | | | (0.34 | ) | | | (11.11 | ) | | | (11.45 | ) | | | — | | | | (5.84 | ) | | | (5.84 | ) | | | 19.40 | | | | 2.02 | | | | 2.02 | | | | (1.25 | ) | | | 51 | | | | (36.26 | ) | | | 59 | |
| 11/01/06 | | | 10/31/07 | | | | 34.17 | | | | (0.39 | ) | | | 5.76 | (b) | | | 5.37 | | | | — | | | | (2.85 | ) | | | (2.85 | ) | | | 36.69 | | | | 2.00 | | | | 2.00 | | | | (1.12 | ) | | | 64 | | | | 16.75 | | | | 110 | |
| 11/01/05 | | | 10/31/06 | | | | 30.03 | | | | (0.38 | ) | | | 5.66 | (b) | | | 5.28 | | | | — | | | | (1.14 | ) | | | (1.14 | ) | | | 34.17 | | | | 1.99 | | | | 1.99 | | | | (1.18 | ) | | | 49 | | | | 18.02 | | | | 100 | |
| Class I* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 25.44 | | | | (0.12 | ) | | | 9.09 | | | | 8.97 | | | | — | | | | — | | | | — | | | | 34.41 | | | | 0.86 | | | | 0.86 | | | | (0.34 | ) | | | 49 | | | | 35.26 | | | | 97 | |
| 11/01/08 | | | 10/31/09 | | | | 22.72 | | | | (0.08 | ) | | | 2.80 | | | | 2.72 | | | | — | | | | — | | | | — | | | | 25.44 | | | | 0.87 | | | | 0.87 | | | | (0.37 | ) | | | 110 | | | | 11.97 | | | | 20 | |
| 11/01/07 | | | 10/31/08 | | | | 41.51 | | | | (0.08 | ) | | | (12.87 | ) | | | (12.95 | ) | | | — | | | | (5.84 | ) | | | (5.84 | ) | | | 22.72 | | | | 0.93 | | | | 0.93 | | | | (0.27 | ) | | | 51 | | | | (35.57 | ) | | | 10 | |
| 11/01/06 | | | 10/31/07 | | | | 37.91 | | | | (0.06 | ) | | | 6.51 | (b) | | | 6.45 | | | | — | | | | (2.85 | ) | | | (2.85 | ) | | | 41.51 | | | | 0.95 | | | | 0.96 | | | | (0.15 | ) | | | 64 | | | | 18.03 | | | | 2 | |
| 06/27/06 | | | 10/31/06 | | | | 33.68 | | | | (0.02 | ) | | | 4.25 | (b) | | | 4.23 | | | | — | | | | — | | | | — | | | | 37.91 | | | | 0.95 | (d) | | | 1.08 | (d) | | | (0.14 | )(d) | | | 49 | | | | 12.56 | (e) | | | 0 | |
| Class R-3* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 24.96 | | | | (0.19 | ) | | | 8.75 | | | | 8.56 | | | | — | | | | — | | | | — | | | | 33.52 | | | | 1.55 | | | | 1.55 | | | | (0.66 | ) | | | 49 | | | | 34.29 | | | | 2 | |
| 11/01/08 | | | 10/31/09 | | | | 22.44 | | | | (0.18 | ) | | | 2.70 | | | | 2.52 | | | | — | | | | — | | | | — | | | | 24.96 | | | | 1.54 | | | | 1.54 | | | | (1.01 | ) | | | 110 | | | | 11.23 | | | | 2 | |
| 11/01/07 | | | 10/31/08 | | | | 41.25 | | | | (0.20 | ) | | | (12.77 | ) | | | (12.97 | ) | | | — | | | | (5.84 | ) | | | (5.84 | ) | | | 22.44 | | | | 1.42 | | | | 1.42 | | | | (0.67 | ) | | | 51 | | | | (35.88 | ) | | | 1 | |
| 11/01/06 | | | 10/31/07 | | | | 37.88 | | | | (0.28 | ) | | | 6.50 | (b) | | | 6.22 | | | | — | | | | (2.85 | ) | | | (2.85 | ) | | | 41.25 | | | | 1.37 | | | | 1.37 | | | | (0.65 | ) | | | 64 | | | | 17.40 | | | | 1 | |
| 09/19/06 | | | 10/31/06 | | | | 35.99 | | | | (0.03 | ) | | | 1.92 | (b) | | | 1.89 | | | | — | | | | — | | | | — | | | | 37.88 | | | | 1.60 | (d) | | | 2.05 | (d) | | | (1.04 | )(d) | | | 49 | | | | 5.25 | (e) | | | 0 | |
| Class R-5* | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 11/01/09 | | | 10/31/10 | | | | 25.43 | | | | (0.04 | ) | | | 9.00 | | | | 8.96 | | | | — | | | | — | | | | — | | | | 34.39 | | | | 0.88 | | | | 0.88 | | | | (0.14 | ) | | | 49 | | | | 35.23 | | | | 49 | |
| 11/01/08 | | | 10/31/09 | | | | 22.72 | | | | (0.09 | ) | | | 2.80 | | | | 2.71 | | | | — | | | | — | | | | — | | | | 25.43 | | | | 0.90 | | | | 0.90 | | | | (0.40 | ) | | | 110 | | | | 11.93 | | | | 30 | |
| 11/01/07 | | | 10/31/08 | | | | 41.50 | | | | (0.05 | ) | | | (12.89 | ) | | | (12.94 | ) | | | — | | | | (5.84 | ) | | | (5.84 | ) | | | 22.72 | | | | 0.90 | | | | 0.90 | | | | (0.15 | ) | | | 51 | | | | (35.55 | ) | | | 11 | |
| 11/01/06 | | | 10/31/07 | | | | 37.88 | | | | — | | | | 6.47 | (b) | | | 6.47 | | | | — | | | | (2.85 | ) | | | (2.85 | ) | | | 41.50 | | | | 0.88 | | | | 0.88 | | | | (0.01 | ) | | | 64 | | | | 18.10 | | | | 15 | |
| 10/02/06 | | | 10/31/06 | | | | 35.86 | | | | — | | | | 2.02 | (b) | | | 2.02 | | | | — | | | | — | | | | — | | | | 37.88 | | | | 0.83 | (d) | | | 0.83 | (d) | | | (0.10 | )(d) | | | 49 | | | | 5.63 | (e) | | | 13 | |
* Per share amounts have been calculated using the monthly average share method.
(a) Total returns are calculated without the imposition of either front-end or contingent deferred sales charges. (b) Includes redemption fee amounts that represent less than $0.01 per share. (c) Denotes a partial period when the Eagle Capital Appreciation Fund and Eagle Growth & Income Fund changed their fiscal and tax year ends to October 31. (d) Annualized. (e) Not annualized. (f) Includes tax return of capital distribution of $0.02 per share. (g) There were no shares outstanding from February 25, 2009 through March 12, 2009.
| | | | |
| The accompanying notes are an integral part of the financial statements. | | | 45 | |
Notes to Financial Statements
NOTE 1 | Organization and investment objective The Eagle Capital Appreciation Fund, Eagle Growth & Income Fund and Eagle Series Trust (each a “Trust” and collectively the “Trusts” or the “Eagle Family of Funds”) are organized as separate Massachusetts business trusts and are registered under the Investment Company Act of 1940, as amended, as diversified, open-end management investment companies. Members of the Boards of Trustees (“Boards”) for the Trusts may serve as Trustees for one or more of the Trusts. Each Trust offers shares in the following series (each a “Fund” and collectively the “Funds”) and are advised by Eagle Asset Management, Inc. (“Eagle” or “Manager”).
| | • | | The Eagle Capital Appreciation Fund (“Capital Appreciation Fund”) seeks long-term capital appreciation. |
| | • | | The Eagle Growth & Income Fund (“Growth & Income Fund”) primarily seeks long-term capital appreciation and, secondarily, seeks current income. |
The Eagle Series Trust currently offers shares in seven series:
| | • | | The Eagle International Equity Fund (“International Equity Fund”) seeks capital appreciation principally through investment in a portfolio of international equity securities, |
| | • | | The Eagle Investment Grade Bond Fund (“Investment Grade Bond Fund”) seeks current income and preservation of capital, |
| | • | | The Eagle Large Cap Core Fund (“Large Cap Core Fund”) seeks long-term growth through capital appreciation, |
| | • | | The Eagle Mid Cap Growth Fund (“Mid Cap Growth Fund”) seeks long-term capital appreciation, |
| | • | | The Eagle Mid Cap Stock Fund (“Mid Cap Stock Fund”) seeks long-term capital appreciation, |
| | • | | The Eagle Small Cap Core Value Fund (“Small Cap Core Value Fund”) seeks capital growth, and |
| | • | | The Eagle Small Cap Growth Fund (“Small Cap Growth Fund”) seeks long-term capital appreciation. |
Class offerings Each Fund is authorized and currently offers Class A, Class C, Class I, Class R-3 and Class R-5 shares to qualified buyers.
| | • | | For all funds except the Investment Grade Bond Fund, Class A shares are sold at a maximum front-end sales charge of 4.75%. For the Investment Grade Bond Fund, Class A shares are sold at a maximum front-end sales charge of 3.75%. Class A share investments greater than $1 million, which are not sold subject to a sales charge, may be subject to a contingent deferred sales charge |
| | | (“CDSC”) of up to 1% of the lower of net asset value (“NAV”) or purchase price if redeemed within 18 months of purchase. |
| | • | | Class C shares are sold subject to a CDSC of 1% of the lower of NAV or purchase price if redeemed within one year of purchase. |
| | • | | Class I, Class R-3 and Class R-5 shares are each sold without a front-end sales charge or a CDSC to qualified buyers. |
NOTE 2 | Significant accounting policies
Use of estimates The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates and those differences could be material.
Valuation of securities The price of each Fund’s shares is based on the NAV per share of each class of a Fund. The Funds determine the NAV of their shares on each day the New York Stock Exchange (“NYSE”) is open for business, as of the close of the regular trading session (typically 4:00 p.m. Eastern time), or earlier NYSE closing time that day. If the NYSE or other securities exchange modifies the closing price of securities traded on that exchange after the NAV is calculated, the Manager is not required to recalculate the NAV.
Generally, the Funds value portfolio securities for which market quotations are readily available at market value; however, a Fund may adjust the market quotation price to reflect events that occur between the close of those markets and the time of the Fund’s determination of the NAV.
A market quotation may be considered unreliable or unavailable for various reasons, such as:
| | • | | The quotation may be stale; |
| | • | | The quotation may be unreliable because the security is not traded frequently; |
| | • | | Trading on the security ceased before the close of the trading market; |
| | • | | Security is newly issued; |
| | • | | Issuer specific events occurred after the security ceased trading; or |
| | • | | Because of the passage of time between the close of the market on which the security trades and the close of the NYSE. |
Notes to Financial Statements
Issuer specific events may cause the last market quotation to be unreliable. Such events may include:
| | • | | A merger or insolvency; |
| | • | | Events which affect a geographical area or an industry segment, such as political events or natural disasters; or |
| | • | | Market events, such as a significant movement in the U.S. market. |
Both the latest transaction prices and adjustments are furnished by an independent pricing service subject to supervision by the Boards. The Funds value all other securities and assets for which market quotations are unavailable or unreliable at their fair value in good faith using procedures (“Procedures”) approved by the Boards. A Fund may fair value small-cap securities, for example, that are thinly traded or illiquid. Fair value is that amount that the owner might reasonably expect to receive for the security upon its current sale. Fair value requires consideration of all appropriate factors, including indications of fair value available from pricing services. A fair value price is an estimated price and may vary from the prices used by other mutual funds to calculate their NAV. Fair value pricing methods, Procedures and pricing services can change from time to time as approved by the Boards. Pursuant to the Procedures, the Boards have delegated the day-to-day responsibility for applying and administering the Procedures to a valuation committee comprised of certain officers of the Trusts and other employees of the Manager (“Valuation Committee”). The composition of this Valuation Committee may change from time to time.
There can be no assurance, however, that a fair value price used by a Fund on any given day will more accurately reflect the market value of a security than the market price of such security on that day. Fair value pricing may deter shareholders from trading the Fund shares on a frequent basis in an attempt to take advantage of arbitrage opportunities resulting from potentially stale prices of portfolio holdings. However, it cannot eliminate the possibility of frequent trading. Specific types of securities are valued as follows:
| | • | | Domestic exchange traded equity securities Market quotations are generally available and reliable for domestic exchange traded equity securities. If the prices provided by the pricing service and independent quoted prices are unreliable, the Valuation Committee will fair value the security using the Procedures. |
| | • | | Foreign equity securities If market quotations are available and reliable for foreign exchange traded equity securities, the securities will be valued at the market quotations. Because trading hours for certain foreign securities end |
| | | before the close of the NYSE, closing market quotations may become unreliable. Consequently, fair valuation of portfolio securities may occur on a daily basis. The Fund may fair value a security if certain events occur between the time trading ends on a particular security and the Fund’s NAV calculation. The Fund may also fair value a particular security if the events are significant and make the closing price unreliable. If an issuer specific event has occurred that Eagle determines, in its judgment, is likely to have affected the closing price of a foreign security, it will price the security at fair value. Eagle also utilizes a screening process from a pricing vendor to indicate the degree of certainty, based on historical data, that the closing price in the principal market where a foreign security trades is not the current market value as of the close of the NYSE. Securities and other assets quoted in foreign currencies are valued in U.S. dollars based on exchange rates provided by a pricing service. The pricing vendor, pricing methodology or degree of certainty may change from time to time. Fund securities primarily traded on foreign markets may trade on days that are not business days of the Fund. Because the NAV of Fund shares is determined only on business days of the Fund, the value of the portfolio securities of a Fund that invests in foreign securities may change on days when you will not be able to purchase or redeem shares of the Fund. |
| | • | | Fixed income securities Government, corporate, asset-backed bonds, municipal bonds and convertible securities, including high yield or junk bonds, normally are valued on the basis of prices provided by independent pricing services. Prices provided by the pricing services may be determined without exclusive reliance on quoted prices, and may reflect appropriate factors such as institution-size trading in similar groups of securities, developments related to special securities, dividend rate, maturity and other market data. If the prices provided by the pricing service and independent quoted prices are unreliable, the Valuation Committee will fair value the security using the Procedures. |
| | • | | Short-term securities The amortized cost method of security valuation is used by the Funds (as set forth in Rule 2a-7 under the Investment Company Act of 1940, as amended) for short-term investments (investments that have a maturity date of 60 days or less). The amortized cost of an instrument is determined by valuing it at cost as of the time of purchase and thereafter accreting/amortizing any purchase discount/premium at a constant rate until maturity. Amortized cost approximates fair value. |
Notes to Financial Statements
| | • | | Futures and options Futures and options are valued on the basis of market quotations, if available. |
| | • | | Investment Companies Investments in other investment companies are valued at their reported net asset value. |
Each Fund utilizes a three level hierarchy of inputs to establish a classification of fair value measurements. The three levels are defined below:
Level 1—Valuations based on quoted prices for identical securities in active markets;
Level 2—Valuations based on inputs other than quoted prices that are observable, either directly or indirectly, including inputs in markets that are not considered active; and
Level 3—Valuations based on inputs that are unobservable and significant to the fair value measurement.
The following is a summary of the inputs used to value each Fund’s investments as of October 31, 2010.
| | | | | | | | | | | | |
| | | Quoted prices in
active markets for identical assets (Level 1) | | | Significant other observable inputs (Level 2) | | | Total | |
| Capital Appreciation Fund | | | | | | | | | | | | |
| Domestic common stock (a) | | | $583,885,285 | | | | $— | | | | $583,885,285 | |
| Short-term investments | | | — | | | | 10,318,600 | | | | 10,318,600 | |
| Total investment portfolio | | | $583,885,285 | | | | $10,318,600 | | | | $594,203,885 | |
| Growth & Income Fund | | | | | | | | | | | | |
| Domestic common stock (a) | | | $151,392,085 | | | | $— | | | | $151,392,085 | |
| Foreign common stock | | | | | | | | | | | | |
Beverages | | | 4,565,016 | | | | — | | | | 4,565,016 | |
Diversified financial services | | | — | | | | 4,846,133 | | | | 4,846,133 | |
Electric | | | — | | | | 4,377,424 | | | | 4,377,424 | |
Food | | | — | | | | 4,697,678 | | | | 4,697,678 | |
Media | | | 2,038,044 | | | | — | | | | 2,038,044 | |
Oil & gas | | | 8,357,002 | | | | 3,338,756 | | | | 11,695,758 | |
Pharmaceuticals | | | 4,336,507 | | | | — | | | | 4,336,507 | |
| Telecommunications | | | 2,415,508 | | | | 7,422,908 | | | | 9,838,416 | |
| Investment Companies | | | 3,923,430 | | | | — | | | | 3,923,430 | |
| Domestic preferred stocks (a) | | | 2,839,814 | | | | — | | | | 2,839,814 | |
| Short-term investments | | | — | | | | 3,634,756 | | | | 3,634,756 | |
| Total investment portfolio | | | $179,867,406 | | | | $28,317,655 | | | | $208,185,061 | |
| | | | | | | | | | | | |
| | | Quoted prices in
active markets for identical assets (Level 1) | | | Significant other observable inputs (Level 2) | | | Total | |
| International Equity Fund | | | | | | | | | | | | |
Aerospace/defense | | | $534,745 | | | | $3,427 | | | | $538,172 | |
Agriculture | | | 1,017,511 | | | | — | | | | 1,017,511 | |
Airlines | | | 65,112 | | | | — | | | | 65,112 | |
Apparel | | | 89,216 | | | | — | | | | 89,216 | |
Auto manufacturers | | | 528,212 | | | | 4,177,634 | | | | 4,705,846 | |
Auto parts & equipment | | | 171,168 | | | | 521,921 | | | | 693,089 | |
Banks | | | 8,855,699 | | | | 2,562,876 | | | | 11,418,575 | |
Beverages | | | 2,521,570 | | | | — | | | | 2,521,570 | |
Biotechnology | | | — | | | | 69,525 | | | | 69,525 | |
Building materials | | | 91,343 | | | | 761,304 | | | | 852,647 | |
Chemicals | | | 474,226 | | | | 130,059 | | | | 604,285 | |
Commercial services | | | 175,718 | | | | — | | | | 175,718 | |
Computers | | | — | | | | 1,714,625 | | | | 1,714,625 | |
Cosmetics/personal care | | | 478,719 | | | | 732,349 | | | | 1,211,068 | |
Distribution/wholesale | | | — | | | | 1,337,661 | | | | 1,337,661 | |
Diversified financial services | | | 211,882 | | | | 266,515 | | | | 478,397 | |
Electric | | | 555,205 | | | | — | | | | 555,205 | |
Electrical components & equipment | | | 269,595 | | | | 786,630 | | | | 1,056,225 | |
Electronics | | | 198,309 | | | | — | | | | 198,309 | |
Engineering & construction | | | 1,814,377 | | | | 2,012,839 | | | | 3,827,216 | |
Food | | | 6,249,286 | | | | 1,365,525 | | | | 7,614,811 | |
Food service | | | 424,472 | | | | — | | | | 424,472 | |
Forest paper & product | | | — | | | | 668,783 | | | | 668,783 | |
Hand/machine tools | | | — | | | | 212,855 | | | | 212,855 | |
Healthcare products | | | 1,875,927 | | | | 330,622 | | | | 2,206,549 | |
Healthcare services | | | 482,326 | | | | — | | | | 482,326 | |
Holding companies | | | 1,395,330 | | | | 983,303 | | | | 2,378,633 | |
Household products/wares | | | 753,658 | | | | — | | | | 753,658 | |
Insurance | | | 120,178 | | | | 808,593 | | | | 928,771 | |
Internet | | | 1,055,726 | | | | — | | | | 1,055,726 | |
Lodging | | | 372,515 | | | | 168,011 | | | | 540,526 | |
Machinery – constructing mining | | | 457,320 | | | | 465,088 | | | | 922,408 | |
Machinery – diversified | | | 805,290 | | | | 480,174 | | | | 1,285,464 | |
Media | | | — | | | | 376,009 | | | | 376,009 | |
Mining | | | 6,542,315 | | | | 3,662,644 | | | | 10,204,959 | |
Miscellaneous manufacturer | | | 214,198 | | | | — | | | | 214,198 | |
Office/business equipment | | | — | | | | 495,905 | | | | 495,905 | |
Oil & gas | | | 921,478 | | | | 1,237,215 | | | | 2,158,693 | |
Oil & gas services | | | 138,264 | | | | 150,112 | | | | 288,376 | |
Pharmaceuticals | | | 2,406,914 | | | | 949,207 | | | | 3,356,121 | |
Notes to Financial Statements
| | | | | | | | | | | | |
| | | Quoted prices in
active markets for identical assets (Level 1) | | | Significant other observable inputs (Level 2) | | | Total | |
| International Equity Fund (cont’d) | | | | | |
Real estate | | | $— | | | | $3,080,759 | | | | $3,080,759 | |
Retail | | | 1,681,494 | | | | 1,600,970 | | | | 3,282,464 | |
Semiconductors | | | | | | | 408,824 | | | | 408,824 | |
Software | | | 95,551 | | | | — | | | | 95,551 | |
Telecommunications | | | 1,294,026 | | | | 908,960 | | | | 2,202,986 | |
Transportation | | | 495,744 | | | | 169,334 | | | | 665,078 | |
| Foreign preferred stocks | | | | | | | | | | | | |
Auto Manufacturers | | | — | | | | 548,062 | | | | 548,062 | |
Household products | | | 192,348 | | | | — | | | | 192,348 | |
| Investment companies | | | | | | | | | | | | |
| Equity funds | | | 2,222,273 | | | | 2,077,570 | | | | 4,299,843 | |
| Other financial instruments (b) | | | (156,542 | ) | | | — | | | | (156,542 | ) |
| Total investment portfolio | | | $48,092,698 | | | | $36,225,890 | | | | $84,318,588 | |
| Investment Grade Bond Fund | | | | | | | | | | | | |
| Domestic corporate bonds (a) | | | $— | | | | $34,865,061 | | | | $34,865,061 | |
| U.S. Government Agency securities (a) | | | — | | | | 11,263,892 | | | | 11,263,892 | |
| U.S. Treasuries (a) | | | — | | | | 33,142,188 | | | | 33,142,188 | |
| Mortgage-backed obligations (a) | | | — | | | | 12,496,678 | | | | 12,496,678 | |
| Supranational | | | — | | | | 3,409,049 | | | | 3,409,049 | |
| Foreign government securities | | | — | | | | 3,439,893 | | | | 3,439,893 | |
| Short-term investments | | | — | | | | 2,440,122 | | | | 2,440,122 | |
| Total investment portfolio | | | $— | | | | $101,056,883 | | | | $101,056,883 | |
| Large Cap Core Fund | | | | | | | | | | | | |
| Domestic common stocks (a) | | | $119,663,264 | | | | $— | | | | $119,663,264 | |
| Investment companies (a) | | | 4,155,567 | | | | — | | | | 4,155,567 | |
| Short-term investments | | | — | | | | 12,702,060 | | | | 12,702,060 | |
| Total investment portfolio | | | $123,818,831 | | | | $12,702,060 | | | | $136,520,891 | |
| Mid Cap Growth Fund | | | | | | | | | | | | |
| Domestic common stocks (a) | | | $214,470,359 | | | | — | | | | $214,470,359 | |
| Total investment portfolio | | | $214,470,359 | | | | — | | | | $214,470,359 | |
| Mid Cap Stock Fund | | | | | | | | | | | | |
| Domestic common stocks (a) | | | $1,380,054,055 | | | | $— | | | | $1,380,054,055 | |
| Short-term investments | | | — | | | | 18,197,500 | | | | 18,197,500 | |
| Total investment portfolio | | | $1,380,054,055 | | | | $18,197,500 | | | | $1,398,251,555 | |
| Small Cap Core Value Fund | | | | | | | | | | | | |
| Domestic common stocks (a) | | | $66,321,281 | | | | $— | | | | $66,321,281 | |
| Investment Companies (a) | | | 2,133,579 | | | | — | | | | 2,133,579 | |
| Short-term investments | | | — | | | | 2,348,057 | | | | 2,348,057 | |
| Total investment portfolio | | | $68,454,860 | | | | $2,348,057 | | | | $70,802,917 | |
| | | | | | | | | | | | |
| | | Quoted prices in
active markets for identical assets (Level 1) | | | Significant other observable inputs (Level 2) | | | Total | |
| Small Cap Growth Fund | | | | | | | | | | | | |
| Domestic common stock (a) | | | $479,763,212 | | | | $— | | | | $479,763,212 | |
| Short term investments | | | — | | | | 8,402,487 | | | | 8,402,487 | |
| Total Investment portfolio | | | $479,763,212 | | | | $8,402,487 | | | | $488,165,699 | |
|
| (a) Please see the investment portfolio for detail by industry. | |
|
| (b) Other financial instruments include foreign forward currency contracts which are valued at the unrealized appreciation/(depreciation) of the instrument. | |
As of October 31, 2010, no Fund had any investments classified as Level 3, and there were no significant transfers in and out of levels 1, 2, or 3.
Derivative instruments The Funds have adopted the provisions of FASB Accounting Standards CodificationTM ASC 815-10-50 (“Statement”). The new requirement amends and expands the disclosure requirement related to derivative instruments in order to provide users of financial statements with an enhanced understanding of the use of derivative instruments by a Fund and how these derivatives affect the financial position, financial performance and cash flows of the Fund. The Statement requires qualitative disclosures about the objectives and strategies for using derivative instruments, quantitative disclosures about the fair value of, and gains and losses on, derivative instruments, as well as disclosures about credit-risk-related contingent features in derivative agreements.
During the year ended October 31, 2010, the International Equity Fund engaged in limited derivative activity. The contract amounts in the Investment Portfolio are representative of typical volumes.
Fair values of derivative instruments for the International Equity Fund as of October 31, 2010 are as follows:
| | | | | | |
| Type of derivative | | Balance sheet location | | Value | |
| Assets | | | | | |
| Forward foreign currency contracts | | Unrealized gain on forward currency contracts | | | $366,202 | |
| Liabilities | | | | | | |
| Forward foreign currency contracts | | Unrealized loss on forward currency contracts | | | $522,744 | |
Notes to Financial Statements
The effect of derivative instruments on the International Equity Fund’s Statement of Operations for the year ended October 31, 2010 is as follows:
| | |
| Type of derivative | | Forward foreign currency contracts |
| Location of gain (loss) on derivatives recognized in income | | Net realized gain (loss) on foreign currency transactions/Net change in unrealized appreciation (depreciation) on translation of assets and liabilities denominated in foreign currencies |
| Realized gain (loss) on derivatives recognized in income | | $1,201,477 |
| Change in unrealized appreciation (depreciation) on derivatives recognized in income | | $109,173 |
During the year ended October 31, 2010, no other Fund engaged in derivative activity.
Foreign currency transactions The books and records of each Fund are maintained in U.S. dollars. Foreign currency transactions are translated into U.S. dollars on the following basis: (i) market value of investment securities, other assets and other liabilities at the daily rates of exchange, and (ii) purchases and sales of investment securities, dividend and interest income and certain expenses at the rates of exchange prevailing on the respective dates of such transactions. Each Fund does not isolate that portion of gains and losses on investments which is due to changes in foreign exchange rates from that which is due to changes in market prices of the investments. Such fluctuations are included with the net realized and unrealized gains and losses from investment transactions. Net realized gain (loss) from foreign currency transactions and the net change in unrealized appreciation (depreciation) on translation of assets and liabilities denominated in foreign currencies include gains and losses between trade and settlement date on securities transactions, gains and losses arising from the purchase and sale of forward foreign currency contracts and gains and losses between the ex and payment dates on dividends, interest and foreign withholding taxes. Net realized gain (loss) from foreign currency transactions also includes the effect of any Brazilian IOF tax.
Forward foreign currency contracts Each of the Funds except the Small Cap Growth Fund is authorized to enter into forward foreign currency contracts which are used primarily to hedge against foreign currency exchange rate risk on its non-U.S. dollar denominated investment securities. Forward foreign currency contracts are translated to U.S. dollars using forward exchange rates provided by a pricing service as of the close of the NYSE each valuation day and the unrealized gain or loss is
included in the Statement of Assets and Liabilities. When the contracts are closed, the gain or loss is realized. Realized and unrealized gains and losses are included in the Statements of Operations. Risks may arise from unanticipated movements in the currency’s value relative to the U.S. dollar and from the possible inability of counter-parties to meet the terms of their contracts.
Real estate investment trusts (“REITs”) There are certain additional risks involved in investing in REITs. These include, but are not limited to, economic conditions, changes in zoning laws, real estate values, property taxes and interest rates. Dividend income is recorded based upon the Manager’s estimate of the amount of income included in distributions from the REIT investments. Distributions received in excess of the estimated income amount are recorded as a reduction of the cost of the investments. The actual amounts of income, return of capital and capital gains are only determined by each REIT after the fiscal year end and may differ from the estimated amounts.
Repurchase agreements Each Fund enters into repurchase agreements whereby a Fund, through its custodian, receives delivery of the underlying securities, the market value of which at the time of purchase is required to be in an amount of at least 100% of the resale price. Repurchase agreements involve the risk that the seller will fail to repurchase the security, as agreed. In that case, each Fund will bear the risk of market value fluctuations until the security can be sold and may encounter delays and incur costs in liquidating the security. In the event of bankruptcy or insolvency of the seller, delays and costs may be incurred. At October 31, 2010, no Fund held a repurchase agreement.
Revenue recognition Investment security transactions are accounted for on a trade date basis. Dividend income is recorded on the ex-dividend date. Interest income is recorded on an accrual basis.
Expenses Each Fund is charged for those expenses that are directly attributable to it, while other expenses are allocated proportionately among the Eagle Family of Funds based upon methods approved by the Boards. Expenses that are directly attributable to a specific class of shares, such as distribution fees, shareholder servicing fees and administrative fees, are charged directly to that class. Other expenses of each Fund are allocated to each class of shares based upon their relative percentage of net assets. The Funds have entered into an arrangement with the custodian whereby each Fund receives credits on uninvested cash balances which are used to offset a portion of each Fund’s expenses. These custodian credits are shown as “Expense offsets” in the Statements of Operations.
Notes to Financial Statements
Class allocations Each class of shares has equal rights to earnings and assets except that each class may bear different expense for administration, distribution and/or shareholder services. Income, expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its relative net assets.
Distribution of income and gains In each Fund except the Investment Grade Bond Fund and the Growth & Income Fund, distributions of net investment income are made annually. Distributions of net investment income in the Investment Grade Bond Fund and the Growth & Income Fund are made monthly and quarterly, respectively. Net realized gains from investment transactions during any particular fiscal year in excess of available capital loss carryforwards, which, if not distributed, would be taxable to each Fund, will be distributed to shareholders in the following fiscal year. Each Fund uses the identified cost method for determining realized gain or loss on investments for both financial and federal income tax reporting purposes.
Dividends paid to shareholders from net investment income were as follows:
| | | | | | | | |
| Distributions from net investment income | | 11/1/09 to
10/31/10 | | | 11/1/08 to
10/31/09 | |
| Growth & Income Fund | | | | | | | | |
| Class A | | | $1,850,645 | | | | $2,076,204 | |
| Class C | | | 634,872 | | | | 931,321 | |
| Class I | | | 119,020 | | | | 21,594 | |
| Class R-3 | | | 4,819 | | | | 1,808 | |
| Class R-5 | | | 38 | | | | — | |
| International Equity Fund | | | | | | | | |
| Class A | | | — | | | | 2,569,804 | |
| Class C | | | — | | | | 2,744,203 | |
| Class I | | | — | | | | — | |
| Class R-3 | | | — | | | | — | |
| Class R-5 | | | — | | | | — | |
| Investment Grade Bond Fund | | | | | | | | |
| Class A | | | 261,590 | | | | N/A | |
| Class C | | | 116,920 | | | | N/A | |
| Class I | | | 11,613 | | | | N/A | |
| Class R-3 | | | 72 | | | | N/A | |
| | | | | | | | |
| Distributions from net investment income | | 11/1/09 to
10/31/10 | | | 11/1/08 to
10/31/09 | |
| Investment Grade Bond Fund (cont’d) | | | | | | | | |
| Class R-5 | | | $24 | | | | N/A | |
| Large Cap Core Fund | | | | | | | | |
| Class A | | | 50,802 | | | | 123,051 | |
| Class C | | | — | | | | 10,575 | |
| Class I | | | 914,784 | | | | 2,099,947 | |
| Class R-3 | | | — | | | | — | |
| Class R-5 | | | 161 | | | | — | |
| Small Cap Core Value Fund | | | | | | | | |
| Class A | | | — | | | | — | |
| Class C | | | — | | | | — | |
| Class I | | | 37,838 | | | | — | |
| Class R-3 | | | — | | | | — | |
| Class R-5 | | | — | | | | — | |
Distributions paid to shareholders from net realized gains were as follows:
| | | | | | | | |
| Distributions from net realized gains | | 11/1/09 to
10/31/10 | | | 11/1/08 to
10/31/09 | |
| Small Cap Core Value Fund | | | | | | | | |
| Class A | | | $233,817 | | | | $— | |
| Class C | | | 131,025 | | | | — | |
| Class I | | | 1,662,986 | | | | — | |
| Class R-3 | | | — | | | | — | |
| Class R-5 | | | — | | | | — | |
Offering and organizational costs Offering costs of $79,835 associated with the formation of the Investment Grade Bond Fund were accounted for as a deferred charge and are amortized on a straight-line basis over 12 months from the date of commencement of operations. For the year ended October 31, 2010, the Fund amortized to expense $53,008 and as of October 31, 2010, $26,827 amount of offering cost remain deferred. Also, organizational costs of $41,232, associated with the formation of the Fund, were expensed as incurred.
Other In the normal course of business the Funds enter into contracts that contain a variety of representations and warranties, which provide general indemnifications. The Funds’ maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds and/or its affiliates that have not yet occurred. However, based on experience, the risk of loss to each Fund is expected to be remote.
Notes to Financial Statements
NOTE 3 | Purchases and sales of securities For the year ended October 31, 2010, purchases and sales of investment securities (excluding repurchase agreements and short-term obligations) were as follows:
| | | | | | | | |
| | | Purchases | | | Sales | |
| Capital Appreciation Fund | | | $265,148,949 | | | | $241,930,388 | |
| Growth & Income Fund | | | 143,353,952 | | | | 84,211,877 | |
| International Equity Fund | | | 127,071,497 | | | | 159,099,701 | |
| Investment Grade Bond Fund | | | 130,446,163 | | | | 32,909,453 | |
| Large Cap Core Fund | | | 59,118,929 | | | | 68,079,569 | |
| Mid Cap Growth Fund | | | 185,919,736 | | | | 166,269,049 | |
| Mid Cap Stock Fund | | | 3,423,062,719 | | | | 3,654,497,175 | |
| Small Cap Core Value Fund | | | 15,815,128 | | | | 13,890,814 | |
| Small Cap Growth Fund | | | 243,204,108 | | | | 190,406,891 | |
NOTE 4 | Investment advisory fees and other transactions with affiliates Each Fund agreed to pay to the Manager an investment advisory and an administrative fee equal to an annualized rate based on a percentage of each Fund’s average daily net assets, computed daily and payable monthly. For advisory services provided by the Manager, the investment advisory rate for each Fund was as follows:
| | | | | | | | |
Investment advisory fee
rate schedule | | Breakpoint | | | Investment
advisory fee | |
| Capital Appreciation Fund | |
| First $ billion
Over $1 billion |
| |
| 0.60
0.55 | %
% |
| Growth & Income Fund | |
| First $100 million
$100 million to $500 million Over $500 million |
| |
| 0.60
0.45 0.40 | %
% % |
| International Equity Fund | |
| First $100 million
$100 million to $1 billion Over $1 billion |
| |
| 0.85
0.65 0.55 | %
% % |
| Investment Grade Bond Fund | | | All assets | | | | 0.30 | % |
| Large Cap Core Fund | | | All assets | | | | 0.60 | % |
| Mid Cap Growth Fund, Mid Cap Stock Fund, Small Cap Core Value Fund, Small Cap Growth Fund | |
| First $500 million
$500 million to $1 billion Over $1 billion |
| |
| 0.60
0.55 0.50 | %
% % |
For administrative services provided by the Manager, each Fund agreed to pay an administrative rate of 0.15% for Class A, Class C and Class R-3 shares and 0.10% for Class I and Class R-5.
Subadvisory fees The Manager entered into subadvisory agreements with certain parties to provide investment advice, portfolio management services (including the placement of brokerage orders), certain compliance and other services to the Funds.
The Manager entered into a subadvisory agreement with unaffiliated parties to serve as subadviser to the Capital Appreciation Fund, Growth & Income Fund and International Equity Fund.
The Manager entered into a subadvisory agreement with Eagle Boston Investment Management, Inc. (“EBIM”), an affiliate of Eagle, to serve as subadviser for the Small Cap Core Value Fund. Under this agreement, Eagle pays EBIM an annualized rate of 0.375% on the first $500 million of total assets, 0.35% on assets between $500 million and $1 billion, and 0.325% on all assets over $1 billion as a percentage of the Fund’s average daily net assets, computed daily and payable monthly.
Distribution and service fees Pursuant to the Class A, Class C and Class R-3 Distribution plans and in accordance with Rule 12b-1 of the Investment Company Act of 1940, as amended (“Rule 12b-1 Plans”), the Funds are authorized to pay Eagle Fund Distributors, Inc. (“Distributor”), an affiliate of the Manager, a fee based on the average daily net assets for each class of shares, accrued daily and payable monthly. The distribution and service rate for Class A shares is 0.25%; for Class C shares is 1% and for Class R-3 shares is 0.50%. The Distribution plans for Class I and Class R-5 shares do not authorize a distribution fee to be paid from Fund assets.
Sales charges For the year ended October 31, 2010, total front-end and CDSCs paid to the Distributor were as follows:
| | | | | | | | | | | | |
| | | Front-end
sales charge | | | Contingent deferred
sales charges | |
| | | Class A | | | Class A | | | Class C | |
| Capital Appreciation Fund | | | $81,116 | | | | $11 | | | | $4,169 | |
| Growth & Income Fund | | | 292,661 | | | | 12 | | | | 8,196 | |
| International Equity Fund | | | 16,332 | | | | 19 | | | | 2,741 | |
| Investment Grade Bond Fund | | | 329,439 | | | | 10,000 | | | | 3,527 | |
| Large Cap Core Fund | | | 3,425 | | | | 4 | | | | 377 | |
| Mid Cap Growth Fund | | | 80,196 | | | | 20 | | | | 2,297 | |
| Mid Cap Stock Fund | | | 310,083 | | | | 26 | | | | 13,942 | |
| Small Cap Core Value Fund | | | 27,833 | | | | — | | | | 776 | |
| Small Cap Growth Fund | | | 134,354 | | | | 83 | | | | 7,255 | |
The Distributor paid commissions to salespersons from these fees and incurred other distribution costs.
Notes to Financial Statements
Agency commissions For the year ended October 31, 2010, total agency brokerage commissions paid by the Funds and agency brokerage commissions paid directly to Raymond James & Associates, Inc. (“RJA”), an affiliate of the Manager, were as follows:
| | | | | | | | |
| | | Total agency
brokerage
commissions | | | Paid to Raymond
James &
Associates, Inc.
| |
| Capital Appreciation Fund | | | $383,274 | | | | $ — | |
| Growth & Income Fund | | | 181,908 | | | | 538 | |
| International Equity Fund | | | 356,640 | | | | — | |
| Investment Grade Bond Fund | | | — | | | | — | |
| Large Cap Core Fund | | | 90,479 | | | | — | |
| Mid Cap Growth Fund | | | 323,106 | | | | 5,102 | |
| Mid Cap Stock Fund | | | 5,422,579 | | | | 103,225 | |
| Small Cap Core Value Fund | | | 34,516 | | | | 1,112 | |
| Small Cap Growth Fund | | | 533,431 | | | | 7,450 | |
Internal audit fees RJA provides internal audit services to the Funds. Each Fund pays RJA a fixed and/or hourly fee for these services.
Fund accounting fees For the period November 1, 2009 through September 12, 2010, Eagle Fund Services, Inc. (“EFS”), an affiliate of the Manager, was the fund accountant for each of the Funds except the International Equity Fund. For providing fund accounting services, EFS received payment from the Funds at a fixed base fee per fund, a multiple class fee and any out-of-pocket expenses. The custodian provided fund accounting services for the International Equity Fund during that period. Effective September 13, 2010, each Fund engaged an unaffiliated third party to provide these services, and they received payment from the Funds at a percentage of net assets plus any out-of-pocket expenses.
For the year ended October 31, 2010, a portion of the Fund accounting fees were paid to EFS as follows:
| | | | |
| Fund accounting fees | | | |
| Capital Appreciation Fund | | | $89,508 | |
| Growth & Income Fund | | | 93,361 | |
| International Equity Fund | | | — | |
| Investment Grade Bond Fund | | | 59,860 | |
| Large Cap Core Fund | | | 89,327 | |
| Mid Cap Growth Fund | | | 89,281 | |
| Mid Cap Stock Fund | | | 89,504 | |
| Small Cap Core Value Fund | | | 89,080 | |
| Small Cap Growth Fund | | | 89,532 | |
Transfer agent and shareholder servicing fees For the period November 1, 2009 through September 12, 2010, EFS was the transfer and shareholder servicing agent for each of the Funds. For providing these services, EFS received payment from the Funds at a fixed fee per shareholder account plus any out-of-pocket expenses. Effective September 13, 2010, each Fund engaged an unaffiliated third party to provide transfer agent services, while engaging EFS to provide certain shareholder services. EFS’ actual cost of providing such services is reimbursed by the Funds on a pro-rata basis of each Fund’s relative total net assets. The third party received payment from the Funds at a fixed fee per shareholder account plus any out-of-pocket charges.
For the year ended October 31, 2010, a portion of the Shareholder Servicing fees were paid to EFS as follows:
| | | | | | | | | | | | | | | | | | | | |
Shareholder servicing
fees | | Class
A | | | Class
C | | | Class
I | | | Class
R-3 | | | Class
R-5 | |
| Capital Appreciation Fund | | | $792,892 | | | | $148,353 | | | | $19,301 | | | | $1,068 | | | | $20,167 | |
| Growth & Income Fund | | | 177,232 | | | | 86,693 | | | | 6,200 | | | | 415 | | | | 19 | |
| International Equity Fund | | | 78,322 | | | | 101,125 | | | | 120 | | | | 77 | | | | 5 | |
| Investment Grade Bond Fund | | | 7,388 | | | | 9,564 | | | | 283 | | | | 13 | | | | 13 | |
| Large Cap Core Fund | | | 17,014 | | | | 21,467 | | | | 309,554 | | | | 16 | | | | 68 | |
| Mid Cap Growth Fund | | | 169,618 | | | | 83,465 | | | | 6,521 | | | | 1,197 | | | | 31 | |
| Mid Cap Stock Fund | | | 1,606,770 | | | | 437,870 | | | | 313,150 | | | | 5,535 | | | | 61,092 | |
| Small Cap Core Value Fund | | | 11,393 | | | | 9,453 | | | | 161,556 | | | | 17 | | | | 14 | |
| Small Cap Growth Fund | | | 498,916 | | | | 132,745 | | | | 35,970 | | | | 3,194 | | | | 31,754 | |
Expense limitations Eagle has contractually agreed to waive its fees and/or reimburse expenses to each class to the extent that the annual operating expense rate for each class of shares exceed the following annualized rates as a percentage of average daily net assets of each class of shares.
| | | | | | | | | | | | | | | | | | | | |
Expense limitations rate
schedule | | Class
A | | | Class
C | | | Class
I | | | Class
R-3 | | | Class
R-5 | |
| Capital Appreciation Fund | | | 1.40 | % | | | 2.20 | % | | | 0.95 | % | | | 1.65 | % | | | 0.95 | % |
| Growth & Income Fund | | | 1.40 | % | | | 2.20 | % | | | 0.95 | % | | | 1.65 | % | | | 0.95 | % |
| International Equity Fund | | | 1.75 | % | | | 2.55 | % | | | 1.15 | % | | | 1.75 | % | | | 1.15 | % |
| Investment Grade Bond Fund | | | 0.85 | % | | | 1.65 | % | | | 0.60 | % | | | 1.15 | % | | | 0.60 | % |
| Large Cap Core Fund | | | 1.40 | % | | | 2.20 | % | | | 0.95 | % | | | 1.65 | % | | | 0.95 | % |
| Mid Cap Growth Fund | | | 1.50 | % | | | 2.30 | % | | | 0.95 | % | | | 1.70 | % | | | 0.95 | % |
| Mid Cap Stock Fund | | | 1.50 | % | | | 2.30 | % | | | 0.95 | % | | | 1.70 | % | | | 0.95 | % |
| Small Cap Core Value Fund | | | 1.50 | % | | | 2.30 | % | | | 0.95 | % | | | 1.70 | % | | | 0.95 | % |
| Small Cap Growth Fund | | | 1.50 | % | | | 2.30 | % | | | 0.95 | % | | | 1.70 | % | | | 0.95 | % |
Notes to Financial Statements
For the year ended October 31, 2010, fees and expenses waived and/or reimbursed based on the expense rate limitation schedule were as follows:
| | | | | | | | | | | | |
| Expenses waived and/or reimbursed | | Fund
Level | | | Class A | | | Class C | |
| Capital Appreciation Fund | | | $ — | | | | $ — | | | | $ — | |
| Growth & Income Fund | | | — | | | | — | | | | — | |
| International Equity Fund | | | 291,011 | | | | 2,335 | | | | — | |
| Investment Grade Bond Fund | | | 172,164 | | | | 34,565 | | | | 19,525 | |
| Large Cap Core Fund | | | — | | | | 826 | | | | 3,662 | |
| Mid Cap Growth Fund | | | — | | | | — | | | | — | |
| Mid Cap Stock Fund | | | — | | | | — | | | | — | |
| Small Cap Core Value Fund | | | 102,180 | | | | 4,099 | | | | 4,755 | |
| Small Cap Growth Fund | | | — | | | | — | | | | — | |
| | | |
Expenses waived and/or reimbursed (cont’d) | | Class I | | | Class R-3 | | | Class R-5 | |
| Capital Appreciation Fund | | | $ — | | | | $ — | | | | $ — | |
| Growth & Income Fund | | | 1,059 | | | | — | | | | 19 | |
| International Equity Fund | | | 448 | | | | 77 | | | | 38 | |
| Investment Grade Bond Fund | | | 22,527 | | | | 36 | | | | 206 | |
| Large Cap Core Fund | | | 346,050 | | | | 16 | | | | 70 | |
| Mid Cap Growth Fund | | | 364 | | | | — | | | | 60 | |
| Mid Cap Stock Fund | | | — | | | | — | | | | — | |
| Small Cap Core Value Fund | | | 239,365 | | | | 21 | | | | 21 | |
| Small Cap Growth Fund | | | — | | | | — | | | | — | |
A portion or all of a Fund’s fees and expenses waived and/or reimbursed by the Manager in prior fiscal years may be recoverable by Eagle prior to their expiration date. Eagle must recover from the same class of shares any previously waived and/or reimbursed fees and expenses within two years from the Fund’s fiscal year end during which the fees and expenses where originally waived and/or reimbursed. Previously waived and/or reimbursed fees and expenses are recovered by Eagle when expenses in the current fiscal year fall below the expense rate limitation then in effect. The following table shows the amounts that Eagle may be allowed to recover by class of shares and the date in which these amounts will expire.
| | | | | | | | |
| Recoverable expenses | | 10/31/2012 | | | 10/31/2011 | |
| Growth & Income Fund Class A | | | $— | | | | $ 213 | |
| Growth & Income Fund Class C | | | — | | | | — | |
| Growth & Income Fund Class I | | | 1,059 | | | | 1,097 | |
| Growth & Income Fund Class R-3 | | | — | | | | — | |
| Growth & Income Fund Class R-5 | | | 19 | | | | — | |
| | | | | | | | |
| Recoverable expenses | | 10/31/2012 | | | 10/31/2011 | |
| International Equity Fund | | | $291,011 | | | | $120,582 | |
| International Equity Fund Class A | | | 2,335 | | | | 28,859 | |
| International Equity Fund Class C | | | — | | | | 23,366 | |
| International Equity Fund Class I | | | 448 | | | | 118 | |
| International Equity Fund Class R-3 | | | 62 | | | | — | |
| International Equity Fund Class R-5 | | | 38 | | | | — | |
| Investment Grade Bond Fund | | | 172,164 | | | | — | |
| Investment Grade Bond Fund Class A | | | 34,565 | | | | — | |
| Investment Grade Bond Fund Class C | | | 19,525 | | | | — | |
| Investment Grade Bond Fund Class I | | | 22,527 | | | | — | |
| Investment Grade Bond Fund Class R-3 | | | 36 | | | | — | |
| Investment Grade Bond Fund Class R-5 | | | 206 | | | | — | |
| Large Cap Core Fund Class A | | | 826 | | | | 8,172 | |
| Large Cap Core Fund Class C | | | 3,662 | | | | 11,295 | |
| Large Cap Core Fund Class I | | | 346,050 | | | | 327,069 | |
| Large Cap Core Fund Class R-3 | | | 16 | | | | — | |
| Large Cap Core Fund Class R-5 | | | 70 | | | | 37 | |
| Mid Cap Growth Fund Class I | | | 364 | | | | 2,265 | |
| Mid Cap Growth Fund Class R-5 | | | 60 | | | | — | |
| Small Cap Core Value Fund | | | 102,180 | | | | 281,547 | |
| Small Cap Core Value Fund Class A | | | 4,099 | | | | 8,003 | |
| Small Cap Core Value Fund Class C | | | 4,755 | | | | 6,223 | |
| Small Cap Core Value Fund Class I | | | 239,365 | | | | 134,164 | |
| Small Cap Core Value Fund Class R-3 | | | 21 | | | | — | |
| Small Cap Core Value Fund Class R-5 | | | 21 | | | | — | |
For the year ended October 31, 2010, the Manager recovered previously waived expenses as follows:
| | | | | | | | | | | | |
| Recovered fees previously waived | | Class A | | | Class C | | | Class R-3 | |
| Growth & Income Fund | | | $107,997 | | | | $44,451 | | | | $6 | |
| International Equity Fund | | | — | | | | 1,118 | | | | 15 | |
Trustees and officers compensation Each Trustee of the Eagle Family of Funds who is not an employee of the Manager receives an annual retainer along with meeting fees for those Eagle Family of Funds’ regular or special meetings attended in person and 25% of such fees are received for telephonic meetings. All reasonable out-of-pocket expenses are also reimbursed. Except when directly attributable to a Fund, Trustees’ fees and expenses are allocated on a pro rata basis among each fund in the Eagle Family of Funds. The pro rata allocation is for each Fund for which the Trustee is elected to serve. Certain officers of the Eagle Family of Funds may also be officers and/or directors of Eagle. Such officers receive no compensation from the Funds except for the Funds’ Chief
Notes to Financial Statements
Compliance Officer. A portion of the Chief Compliance Officer’s total compensation is paid equally by each fund in the Eagle Family of Funds.
NOTE 5 | Federal income taxes and distributions Each Fund is treated as a single corporate taxpayer as provided for in the Tax Reform Act of 1986, as amended. Accordingly, no provision for federal income taxes is required since each Fund intends to continue to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code and distribute to shareholders all of its taxable income and gains. Federal income tax regulations differ from generally accepted accounting principles; therefore, distributions determined in accordance with tax regulations may differ significantly in amount or character from net investment income and realized gains for financial reporting purposes. Financial reporting records are adjusted for permanent book/ tax differences to reflect tax character; these adjustments have no effect on net assets or NAV per share. Financial reporting records are not adjusted for temporary differences. The difference between book-basis and tax-basis net unrealized appreciation (depreciation) is attributable to the deferral of losses from wash sales and the realization of unrealized gains/losses on passive foreign investment companies for tax purposes. The Manager has analyzed the Funds’ tax positions taken or expected to be taken on federal income tax returns for all open tax years (tax years ended October 31, 2007 to October 31, 2010) and has concluded that no provision for federal income tax is required in the Funds’ financial statements.
Capital Appreciation Fund For the fiscal year ended October 31, 2010, to reflect reclassifications arising from permanent book/ tax differences primarily attributable to net operating losses not utilized, the Capital Appreciation Fund increased (credited) accumulated net investment loss by $1,445,633 and decreased (debited) paid-in capital by $1,445,633. As of October 31, 2010, the Capital Appreciation Fund had net tax basis capital loss carryforwards in the aggregate of $64,647,065 which may be applied to any net taxable capital gain until October 31, 2017.
Growth & Income Fund For the fiscal year ended October 31, 2010, to reflect reclassifications arising from permanent book/tax differences primarily attributable to foreign currency transactions, and adjustments for partnership distributions and income, the Growth & Income Fund increased (credited) accumulated net investment income by $19,230 and accumulated net realized loss by $165,271 and decreased (debited) paid-in capital by $184,501. As of October 31, 2010,
the Growth & Income Fund had net tax basis capital loss carryforwards in the aggregate of $11,260,739 of which $2,123,080 may be applied to any net taxable capital gain until October 31, 2016 with the balance of $9,137,659 expiring on October 31, 2017.
International Equity Fund For the fiscal year ended October 31, 2010, to reflect reclassifications arising from permanent book/ tax differences primarily attributable to foreign currency transactions and investments in passive foreign investment companies, the International Equity Fund increased (credited) accumulated net investment loss by $1,394,175 and decreased (debited) accumulated net realized loss by $1,394,175. As of October 31, 2010, the International Equity Fund had net tax basis capital loss carryforwards in the aggregate of $85,152,975 of which $31,873,544 may be applied to any net taxable capital gain until October 31, 2016 with the balance of $53,279,431 expiring on October 31, 2017.
Investment Grade Bond Fund For the fiscal year ended October 31, 2010, to reflect reclassifications arising from permanent book/tax differences primarily attributable to paydown losses and non-deductible distribution expenses, the Investment Grade Bond Fund increased (credited) accumulated net investment income by $141,818 and decreased (debited) accumulated net realized gain by $53,015 and paid-in capital by $88,803. As of October 31, 2010, the Investment Grade Bond Fund did not have any net tax basis capital loss carryforwards.
Large Cap Core Fund For the fiscal year ended October 31, 2010, the Large Cap Core Fund had net tax basis capital loss carryforwards in the aggregate of $64,059,548 of which $25,251,054 may be applied to any net taxable capital gain until October 31, 2016, of which $37,319,289 may be applied to any net taxable capital gain until October 31, 2017 with the balance of $1,489,205 expiring on October 31, 2018.
Mid Cap Growth Fund For the fiscal year ended October 31, 2010, to reflect reclassifications arising from permanent book/ tax differences primarily attributable to net operating losses not utilized, the Mid Cap Growth Fund increased (credited) accumulated net investment loss by $1,001,675 and accumulated net realized loss by $239 and decreased (debited) paid-in capital by $1,001,914. As of October 31, 2010, the Mid Cap Growth Fund had net tax basis capital loss carryforwards in the aggregate of $5,913,203 which may be applied to any net taxable capital gain until October 31, 2017.
Notes to Financial Statements
Mid Cap Stock Fund For the fiscal year ended October 31, 2010, to reflect reclassifications arising from permanent book/tax differences primarily attributable to net operating losses not utilized and adjustment for partnerships, the Mid Cap Stock Fund increased (credited) accumulated net investment loss by $4,836,933 and decreased (debited) accumulated net realized loss by $46,595 and paid-in capital by $4,790,338. As of October 31, 2010, the Mid Cap Stock Fund had net tax basis capital loss carryforwards in the aggregate of $177,706,234 which may be applied to any net taxable capital gain until October 31, 2017.
Small Cap Core Value Fund For the fiscal year ended October 31, 2010, to reflect reclassifications arising from permanent book/ tax differences primarily attributable to net operating losses not utilized, distribution redesignations and adjustments for partnerships, the Small Cap Core Value Fund increased (credited) accumulated net investment loss by $66,841 and decreased (debited) accumulated net realized gain by $55,923 and paid-in capital by $10,918. As of October 31, 2010, the Small Cap Core Value Fund did not have any net tax basis capital loss carryforwards.
Small Cap Growth Fund For the fiscal year ended October 31, 2010, to reflect reclassifications arising from permanent book/ tax differences primarily attributable to net operating losses not utilized, the Small Cap Growth Fund increased (credited) accumulated net investment loss by $2,272,411 and decreased (debited) accumulated net realized loss by $81,092 and paid-in capital by $2,191,319. As of October 31, 2010, the Small Cap Growth Fund had net tax basis capital loss carryforwards in the aggregate of $50,875,764 which may be applied to any net taxable capital gain until October 31, 2017.
For income tax purposes, distributions paid during the fiscal periods indicated were as follows:
| | | | | | | | | | | | | | | | |
| | | Ordinary income | | | Long-term capital
gains | |
| | | 10/31/10 | | | 10/31/09 | | | 10/31/10 | | | 10/31/09 | |
| Capital Appreciation Fund | | | $— | | | | $— | | | | $— | | | | $— | |
| Growth & Income Fund | | | 2,609,394 | | | | 3,030,927 | | | | — | | | | — | |
| International Equity Fund | | | — | | | | 5,314,007 | (a) | | | — | | | | — | |
| Investment Grade Bond Fund | | | 390,219 | | | | — | | | | — | | | | — | |
| Large Cap Core Fund | | | 965,747 | | | | 2,233,573 | | | | — | | | | — | |
| Mid Cap Growth Fund | | | — | | | | — | | | | — | | | | — | |
| Mid Cap Stock Fund | | | — | | | | — | | | | — | | | | — | |
| Small Cap Core Value Fund | | | 2,065,661 | | | | — | | | | — | | | | — | |
| Small Cap Growth Fund | | | — | | | | — | | | | — | | | | — | |
| (a) Includes tax return of capital distributions of $186,860. | | | | | | | | | |
As of October 31, 2010, the components of distributable earnings on a tax basis were as follows:
| | | | | | | | |
| | | Undistributed
ordinary income | | | Undistributed long-
term gain | |
| Capital Appreciation Fund | | | $— | | | | $— | |
| Growth & Income Fund | | | 185,176 | | | | — | |
| International Equity Fund | | | 1,589,547 | | | | — | |
| Investment Grade Bond Fund | | | 831,159 | | | | — | |
| Large Cap Core Fund | | | 524,424 | | | | — | |
| Mid Cap Growth Fund | | | — | | | | — | |
| Mid Cap Stock Fund | | | — | | | | — | |
| Small Cap Core Value Fund | | | 1,503,811 | | | | 4,780,417 | |
| Small Cap Growth Fund | | | — | | | | — | |
As of October 31, 2010, the identified cost of investments in securities owned by each Fund for federal income tax purposes were as follows:
| | | | |
| | | Identified cost | |
| Capital Appreciation Fund | | | $486,776,795 | |
| Growth & Income Fund | | | 190,223,053 | |
| International Equity Fund | | | 70,122,056 | |
| Investment Grade Bond Fund | | | 98,726,508 | |
| Large Cap Core Fund | | | 125,894,427 | |
| Mid Cap Growth Fund | | | 162,329,735 | |
| Mid Cap Stock Fund | | | 1,236,389,360 | |
| Small Cap Core Value Fund | | | 46,774,098 | |
| Small Cap Growth Fund | | | 344,704,666 | |
As of October 31, 2010, the net unrealized appreciation (depreciation) of investments in securities owned by each Fund were as follows:
| | | | | | | | | | | | |
| | | Unrealized
appreciation | | | Unrealized
Depreciation | | | Net unrealized
appreciation
(depreciation) | |
| Capital Appreciation Fund | | | $118,595,129 | | | | $(11,168,039 | ) | | | $107,427,090 | |
| Growth & Income Fund | | | 25,243,692 | | | | (7,281,684 | ) | | | 17,962,008 | |
| International Equity Fund | | | 15,622,306 | | | | (1,269,232 | ) | | | 14,353,074 | |
| Investment Grade Bond Fund | | | 2,378,180 | | | | (47,805 | ) | | | 2,330,375 | |
| Large Cap Core Fund | | | 13,770,487 | | | | (3,144,023 | ) | | | 10,626,464 | |
| Mid Cap Growth Fund | | | 55,070,936 | | | | (2,930,312 | ) | | | 52,140,624 | |
| Mid Cap Stock Fund | | | 178,245,368 | | | | (16,383,173 | ) | | | 161,862,195 | |
| Small Cap Core Value Fund | | | 25,675,474 | | | | (1,646,655 | ) | | | 24,028,819 | |
| Small Cap Growth Fund | | | 150,185,208 | | | | (6,724,175 | ) | | | 143,461,033 | |
Report of Independent Registered Certified Public Accounting Firm
To the Board of Trustees and Shareholders of Eagle Capital Appreciation Fund, Eagle Growth & Income Fund, Eagle International Equity Fund, Eagle Investment Grade Bond Fund, Eagle Large Cap Core Fund, Eagle Mid Cap Growth Fund, Eagle Mid Cap Stock Fund, Eagle Small Cap Core Value Fund and Eagle Small Cap Growth Fund:
In our opinion, the accompanying statements of assets and liabilities, including the investment portfolios, 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 Eagle Capital Appreciation Fund, Eagle Growth & Income Fund, Eagle International Equity Fund, Eagle Investment Grade Bond Fund, Eagle Large Cap Core Fund, Eagle Mid Cap Growth Fund, Eagle Mid Cap Stock Fund, Eagle Small Cap Core Value Fund and Eagle Small Cap Growth Fund (hereafter referred to collectively as the “Funds”), at October 31, 2010, and the results of each of their operations, the changes in each of their net assets and the financial highlights for each of the periods indicated, 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 the standards of the Public Company Accounting Oversight Board (United States). Those standards 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, 2010 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
December 20, 2010
PricewaterhouseCoopers LLP, 4221 West Boy Scout Boulevard, Suite 200, Tampa, FL 33607
T: (813) 229 0221, F: (813) 229 3646, www.pwc.com/us
Understanding Your Ongoing Costs
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges on purchases, contingent deferred sales charges, or redemption fees; and (2) ongoing costs, including investment advisory fees; distribution (12b-1) fees; and other Fund expenses. The following sections are intended to help you understand your ongoing cost (in dollars) of investing in each Fund and to compare these costs with the ongoing costs of investing in other mutual funds. Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect one-time transaction expenses, such as sales charges or redemption fees. Therefore, if these transactional costs were included, your costs would have been higher. For more information, see your Fund’s prospectus or contact your financial advisor.
Actual expenses | The table below shows the actual expenses you would have paid on a $1,000 investment in each Fund on May 1, 2010, and held through October 31, 2010. It also shows how much a $1,000 investment would be worth at the close of the period, assuming actual returns after ongoing expenses. This table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the line under the heading entitled “Expenses paid during period” to estimate the expenses you paid on your account during this period.
| | | | | | | | | | | | | | | | |
| | | Beginning account value
May 1, 2010 | | | Ending account value
October 31, 2010 | | | Expenses paid
during period (a) | | | Annualized
expense ratio | |
| Eagle Capital Appreciation Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,014,30 | | | | $6.45 | | | | 1.27% | |
| Class C | | | $1,000.00 | | | | $1,010.60 | | | | $10.19 | | | | 2.01% | |
| Class I | | | $1,000.00 | | | | $1,016.40 | | | | $5.13 | | | | 1.01% | |
| Class R-3 | | | $1,000.00 | | | | $1,013.20 | | | | $7.97 | | | | 1.57% | |
| Class R-5 | | | $1,000.00 | | | | $1,016.40 | | | | $4.42 | | | | 0.87% | |
| Eagle Growth & Income Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,017.70 | | | | $7.02 | | | | 1.38% | |
| Class C | | | $1,000.00 | | | | $1,014.20 | | | | $10.41 | | | | 2.05% | |
| Class I | | | $1,000.00 | | | | $1,020.10 | | | | $4.23 | | | | 0.83% | |
| Class R-3 | | | $1,000.00 | | | | $1,016.30 | | | | $8.03 | | | | 1.58% | |
| Class R-5 | | | $1,000.00 | | | | $1,020.60 | | | | $4.33 | | | | 0.85% | |
| Eagle International Equity Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,051.80 | | | | $9.00 | | | | 1.74% | |
| Class C | | | $1,000.00 | | | | $1,047.70 | | | | $12.90 | | | | 2.50% | |
| Class I | | | $1,000.00 | | | | $1,055.00 | | | | $6.53 | | | | 1.26% | |
| Class R-3 | | | $1,000.00 | | | | $1,053.30 | | | | $22.15 | | | | 4.28% | |
| Class R-5 | | | $1,000.00 | | | | $1,054.90 | | | | $8.70 | | | | 1.68% | |
| Eagle Investment Grade Bond Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,050.40 | | | | $4.44 | | | | 0.86% | |
| Class C | | | $1,000.00 | | | | $1,046.10 | | | | $8.46 | | | | 1.64% | |
| Class I | | | $1,000.00 | | | | $1,052.20 | | | | $2.84 | | | | 0.55% | |
| Class R-3 | | | $1,000.00 | | | | $1,049.10 | | | | $6.04 | | | | 1.17% | |
| Class R-5 | | | $1,000.00 | | | | $1,051.50 | | | | $3.88 | | | | 0.75% | |
| Eagle Large Cap Core Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $959.70 | | | | $7.16 | | | | 1.45% | |
| Class C | | | $1,000.00 | | | | $956.20 | | | | $11.14 | | | | 2.26% | |
| Class I | | | $1,000.00 | | | | $961.80 | | | | $4.70 | | | | 0.95% | |
| Class R-3 | | | $1,000.00 | | | | $958.90 | | | | $7.55 | | | | 1.53% | |
| Class R-5 | | | $1,000.00 | | | | $961.90 | | | | $4.60 | | | | 0.93% | |
| Eagle Mid Cap Growth Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,045.90 | | | | $6.81 | | | | 1.32% | |
| Class C | | | $1,000.00 | | | | $1,042.20 | | | | $10.86 | | | | 2.11% | |
| Class I | | | $1,000.00 | | | | $1,048.00 | | | | $4.49 | | | | 0.87% | |
| Class R-3 | | | $1,000.00 | | | | $1,044.60 | | | | $7.63 | | | | 1.48% | |
| Class R-5 | | | $1,000.00 | | | | $1,046.90 | | | | $3.92 | | | | 0.76% | |
| Eagle Mid Cap Stock Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,040.60 | | | | $6.27 | | | | 1.22% | |
| Class C | | | $1,000.00 | | | | $1,036.80 | | | | $9.91 | | | | 1.93% | |
| Class I | | | $1,000.00 | | | | $1,042.90 | | | | $3.91 | | | | 0.76% | |
| Class R-3 | | | $1,000.00 | | | | $1,039.20 | | | | $7.30 | | | | 1.42% | |
| Class R-5 | | | $1,000.00 | | | | $1,042.80 | | | | $3.96 | | | | 0.77% | |
| Eagle Small Cap Core Value Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $994.90 | | | | $7.19 | | | | 1.43% | |
| Class C | | | $1,000.00 | | | | $990.80 | | | | $11.29 | | | | 2.25% | |
| Class I | | | $1,000.00 | | | | $997.50 | | | | $4.83 | | | | 0.96% | |
| Class R-3 | | | $1,000.00 | | | | $994.90 | | | | $8.25 | | | | 1.64% | |
| Class R-5 | | | $1,000.00 | | | | $998.00 | | | | $4.28 | | | | 0.85% | |
| Eagle Small Cap Growth Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,061.60 | | | | $7.02 | | | | 1.35% | |
| Class C | | | $1,000.00 | | | | $1,058.30 | | | | $10.74 | | | | 2.07% | |
| Class I | | | $1,000.00 | | | | $1,064.30 | | | | $4.01 | | | | 0.77% | |
| Class R-3 | | | $1,000.00 | | | | $1,060.80 | | | | $8.16 | | | | 1.57% | |
| Class R-5 | | | $1,000.00 | | | | $1,064.40 | | | | $4.53 | | | | 0.87% | |
(a) Expenses are calculated using each Funds’ annualized expense ratios for each class of shares, multiplied by the average account value for the period, then multiplying the result by the actual number of days in the period (184); and then dividing that result by the actual number of days in the fiscal year (365).
Understanding Your Ongoing Costs
Hypothetical example for comparison purposes | All mutual funds now follow guidelines to assist shareholders in comparing expenses between different funds. Per these guidelines, the table below shows each Fund’s expenses based on a $1,000 investment held from May 1, 2010 through October 31, 2010 and assuming for this period a hypothetical 5% annualized rate of return before ongoing expenses, which is not the Fund’s
actual return. Please note that you should not use this information to estimate your actual ending account balance and expenses paid during the period. You can use this information to compare the ongoing expenses (but not transaction expenses or total costs) of investing in the Funds with those of other funds. All mutual fund shareholder reports will provide this information to help you make this comparison.
| | | | | | | | | | | | | | | | |
| | | Beginning account value
May 1, 2010 | | | Ending account value
October 31, 2010 | | | Expenses paid
during period (a) | | | Annualized
expense ratio | |
| | | | |
| Eagle Capital Appreciation Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,018.80 | | | | $6.46 | | | | 1.27% | |
| Class C | | | $1,000.00 | | | | $1,015.07 | | | | $10.21 | | | | 2.01% | |
| Class I | | | $1,000.00 | | | | $1,020,11 | | | | $5.14 | | | | 1.01% | |
| Class R-3 | | | $1,000.00 | | | | $1,017.29 | | | | $7.98 | | | | 1.57% | |
| Class R-5 | | | $1,000.00 | | | | $1,020.82 | | | | $4.43 | | | | 0.87% | |
| Eagle Growth & Income Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,018.20 | | | | $7.07 | | | | 1.38% | |
| Class C | | | $1,000.00 | | | | $1,014.87 | | | | $10.41 | | | | 2.05% | |
| Class I | | | $1,000.00 | | | | $1,021.02 | | | | $4.23 | | | | 0.83% | |
| Class R-3 | | | $1,000.00 | | | | $1,017.24 | | | | $8.03 | | | | 1.58% | |
| Class R-5 | | | $1,000.00 | | | | $1,020.92 | | | | $4.33 | | | | 0.85% | |
| Eagle International Equity Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,016.43 | | | | $8.84 | | | | 1.74% | |
| Class C | | | $1,000.00 | | | | $1,012.60 | | | | $12.68 | | | | 2.50% | |
| Class I | | | $1,000.00 | | | | $1,018.85 | | | | $6.41 | | | | 1.26% | |
| Class R-3 | | | $1,000.00 | | | | $1,003.63 | | | | $21.62 | | | | 4.28% | |
| Class R-5 | | | $1,000.00 | | | | $1,016.74 | | | | $8.54 | | | | 1.68% | |
| Eagle Investment Grade Bond Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,020.87 | | | | $4.38 | | | | 0.86% | |
| Class C | | | $1,000.00 | | | | $1,016.94 | | | | $8.34 | | | | 1.64% | |
| Class I | | | $1,000.00 | | | | $1,022.43 | | | | $2.80 | | | | 0.55% | |
| Class R-3 | | | $1,000.00 | | | | $1,019.31 | | | | $5.96 | | | | 1.17% | |
| Class R-5 | | | $1,000.00 | | | | $1,021.42 | | | | $3.82 | | | | 0.75% | |
| Eagle Large Cap Core Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,017.90 | | | | $7.37 | | | | 1.45% | |
| Class C | | | $1,000.00 | | | | $1,013.81 | | | | $11.47 | | | | 2.26% | |
| Class I | | | $1,000.00 | | | | $1,020.42 | | | | $4.84 | | | | 0.95% | |
| Class R-3 | | | $1,000.00 | | | | $1,017.49 | | | | $7.78 | | | | 1.53% | |
| Class R-5 | | | $1,000.00 | | | | $1,020.52 | | | | $4.74 | | | | 0.93% | |
| Eagle Mid Cap Growth Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,018.55 | | | | $6.72 | | | | 1.32% | |
| Class C | | | $1,000.00 | | | | $1,014.57 | | | | $10.71 | | | | 2.11% | |
| Class I | | | $1,000.00 | | | | $1,020.82 | | | | $4.43 | | | | 0.87% | |
| Class R-3 | | | $1,000.00 | | | | $1,017.74 | | | | $7.53 | | | | 1.48% | |
| Class R-5 | | | $1,000.00 | | | | $1,021.37 | | | | $3.87 | | | | 0.76% | |
| Eagle Mid Cap Stock Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,019.06 | | | | $6.21 | | | | 1.22% | |
| Class C | | | $1,000.00 | | | | $1,015.48 | | | | $9.80 | | | | 1.93% | |
| Class I | | | $1,000.00 | | | | $1,021.37 | | | | $3.87 | | | | 0.76% | |
| Class R-3 | | | $1,000.00 | | | | $1,018.05 | | | | $7.22 | | | | 1.42% | |
| Class R-5 | | | $1,000.00 | | | | $1,021.32 | | | | $3.92 | | | | 0.77% | |
| Eagle Small Cap Core Value Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,018.00 | | | | $7.27 | | | | 1.43% | |
| Class C | | | $1,000.00 | | | | $1,013.86 | | | | $11.42 | | | | 2.25% | |
| Class I | | | $1,000.00 | | | | $1,020.37 | | | | $4.89 | | | | 0.96% | |
| Class R-3 | | | $1,000.00 | | | | $1,016.94 | | | | $8.34 | | | | 1.64% | |
| Class R-5 | | | $1,000.00 | | | | $1,020.92 | | | | $4.33 | | | | 0.85% | |
| Eagle Small Cap Growth Fund | | | | | | | | | | | | | | | | |
| Class A | | | $1,000.00 | | | | $1,018.40 | | | | $6.87 | | | | 1.35% | |
| Class C | | | $1,000.00 | | | | $1,014.77 | | | | $10.51 | | | | 2.07% | |
| Class I | | | $1,000.00 | | | | $1,021.32 | | | | $3.92 | | | | 0.77% | |
| Class R-3 | | | $1,000.00 | | | | $1,017.29 | | | | $7.98 | | | | 1.57% | |
| Class R-5 | | | $1,000.00 | | | | $1,020.82 | | | | $4.43 | | | | 0.87% | |
(a) Expenses are calculated using each Funds’ annualized expense ratios for each class of shares, multiplied by the average account value for the period, then multiplying the result by the actual number of days in the period (184); and then dividing that result by the actual number of days in the fiscal year (365).
Renewal of Investment Advisory and Subadvisory Agreements
Overview At a meeting held on August 17, 2010, the Boards of Trustees for the Eagle Capital Appreciation Fund, Eagle Growth & Income Fund and Eagle Series Trust, including their independent members (together, the “Board”), approved the renewal of the investment advisory agreement between the: (1) Eagle Capital Appreciation Fund and Eagle Asset Management, Inc. (“Eagle”); (2) Eagle Growth & Income Fund and Eagle; and (3) Eagle Series Trust, on behalf of the Eagle International Equity Fund, Eagle Investment Grade Bond Fund, Eagle Large Cap Core Fund, Eagle Mid Cap Growth Fund, Eagle Mid Cap Stock Fund, Eagle Small Cap Core Value Fund and Eagle Small Cap Growth Fund, and Eagle. Each of the Funds mentioned is referred to as a “Fund” and collectively, the “Funds.”
The Board also approved the renewal of the investment subadvisory agreement with: (1) Goldman Sachs Asset Management, L.P. (“GSAM”) as subadviser to the Eagle Capital Appreciation Fund; (2) Thornburg Investment Management, Inc. (“Thornburg”) as subadviser to the Eagle Growth & Income Fund; (3) Artio Global Investors, Inc. (“Artio”) as subadviser to the Eagle International Equity Fund; and (4) Eagle Boston Investment Management, Inc. (“EBIM”) as subadviser to the Eagle Small Cap Core Value Fund. The investment advisory and subadvisory agreements are referred to herein as an “Agreement” and collectively, the “Agreements.” GSAM, Thornburg, Artio and EBIM are collectively referred to as the “Subadvisers.”
In renewing the Agreements, the Board took into consideration information furnished for the Board’s review and consideration throughout the year at regular Board meetings, as well as information specifically prepared in connection with the annual renewal process. The Board, acting directly or through its committees, has been provided with information and reports relevant to the annual renewal of the Agreements, including: reports regarding the services and support provided to the Funds and their shareholders by Eagle and the Subadvisers; information and reports related to the transition of certain Fund services to J.P. Morgan Chase Bank, N.A. and its affiliates (collectively, “J.P. Morgan”); information on the Funds’ performance and commentary on the reasons for the performance; presentations by Fund portfolio managers addressing, as applicable, Eagle’s and the Subadvisers’ investment philosophy, investment strategy, personnel and operations; compliance and audit reports concerning the Funds, Eagle and the Subadvisers, including responses to issues raised therein; and information on relevant developments in the mutual fund industry and how the Eagle Funds and/or Eagle are responding to them.
As part of the renewal process, the Board, with the assistance of independent legal counsel, requested and received additional reports containing substantial and detailed information regarding the Funds, Eagle and the Subadvisers. Among other matters, these reports included information on: (1) the nature and extent of the advisory and other services provided by Eagle and the Subadvisers; (2) the personnel of Eagle and the Subadvisers; (3) the financial condition of Eagle and the Subadvisers; (4) the compliance programs and records of Eagle and the Subadvisers; (5) the performance of the Funds as compared to their peer groups and appropriate benchmarks; (6) the Funds’ expenses, including the advisory fee rates, the overall expense structures of the Funds, both in absolute terms and relative to peer funds, and any applicable contractual expense limitations; (7) the anticipated effect of growth and size on the Funds’ performance and expenses, where applicable; (8) benefits to be realized by Eagle, the Subadvisers and their respective affiliates; (9) the estimated profitability of Eagle and the Subadvisers under the Agreements, when available; and (10) information related to J.P. Morgan and the key services that J.P. Morgan proposes to provide to the Funds. The Board posed questions to various management personnel of Eagle regarding certain key aspects of the materials submitted in support of the renewal.
With respect to the renewal of the Agreements, the Board considered various factors, including: (1) the nature, extent and quality of services provided to the Funds; (2) the investment performance of the Funds; (3) the costs of the services provided to the Funds and the profits realized by Eagle, the Subadvisers and their respective affiliates from their relationship with the Funds; (4) the extent to which economies of scale have been realized as the Funds grow; (5) whether the level of fees reflects those economies of scale for the benefit of the Funds’ investors; (6) comparisons of services and fees with contracts entered into by Eagle and the Subadvisers with other clients (such as pension funds and other institutional investors); and (7) any other benefits derived by Eagle or the Subadvisers from their relationships with the Funds.
Provided below is a discussion of the factors the Board considered at its August meeting to form the basis of its renewal of the Agreements. The Board did not identify any particular information that was most relevant to its consideration to renew the Agreements and each Trustee may have accorded different weight to the various factors.
Nature, extent and quality of services The Board considered that Eagle and the Subadvisers are experienced in serving as
Renewal of Investment Advisory and Subadvisory Agreements
investment advisers for the Funds and have provided a continuous investment program, including investment selection, credit review and market analysis among other matters, for the Funds. The Board noted that Eagle oversees and monitors the performance and services provided by the Subadvisers and is responsible for the selection of Fund subadvisers. The Board also noted that on or about September 13, 2010, Eagle and its affiliate, Eagle Fund Services, Inc. (“EFS”), will provide administration and shareholder servicing services to the Funds, and J.P. Morgan will provide sub-administration, transfer agent and fund accounting services to the Funds. The Board considered that Eagle will oversee and monitor the services provided by J.P. Morgan. In addition, the Board noted that Eagle is responsible for oversight of compliance with the Funds’ policies and objectives, review of brokerage matters, oversight of the Funds’ compliance with applicable law, and implementation of Board directives as they relate to the Funds. The Board noted that shareholders in the Funds have a broad range of investment choices available to them, including a wide choice among mutual funds offered by competitors to Eagle, and that the Funds’ shareholders, with the opportunity to review and weigh the disclosure provided by the Funds in their prospectus and other public disclosures, have chosen to invest in the Funds.
The Board noted that each Subadviser is responsible for making investment decisions on behalf of its respective Fund and placing all orders for the purchase and sale of investments for the Fund with brokers or dealers. The Board considered information regarding: (1) the background and experience of Eagle and Subadviser personnel who provide services to the Funds; (2) material compliance matters during the last year, if any, and certifications as to the adequacy of the compliance programs of Eagle and each Subadviser; (3) the financial information regarding Eagle and each Subadviser, as provided; (4) the impact of J.P. Morgan assuming from Eagle and its affiliates control of certain of the services provided to the Funds; and (5) Eagle’s recommendation to continue to retain the Subadvisers to manage the Funds.
Investment performance The Board considered comparisons of each Fund’s Class A performance, including, if applicable, a Fund’s one-, three-, five- and ten-year annualized total returns for the period ended June 30, 2010, relative to the average performance of its peer group funds and benchmark indexes. The Board also considered the performance of the Subadvisers relative to other accounts managed by the Subadvisers, to the extent such information was available.
With respect to the Eagle Capital Appreciation Fund, the Board noted the following specific factors regarding performance: (1) the Fund outperformed its benchmark index for all relevant time periods with the exception of the one- and three-year periods, during which the Fund underperformed; (2) the Fund outperformed the average performance of its peer group funds for all relevant time periods with the exception of the one-year period, during which the Fund underperformed; and (3) the Fund has equaled the performance of comparable accounts managed by GSAM for the ten-year period, but underperformed for the one-, three- and five-year periods.
With respect to the Eagle Growth & Income Fund, the Board noted the following specific factors regarding performance: (1) the Fund outperformed its benchmark index for all relevant time periods with the exception of the one-year period, during which the Fund underperformed; (2) the Fund outperformed the average performance of its peer group funds for all relevant time periods with the exception of the one-year period, during which the Fund underperformed; and (3) the Fund’s overall 4-star Morningstar rating.
With respect to the Eagle International Equity Fund, the Board noted the following specific factors regarding performance: (1) the Fund underperformed its benchmark index for all relevant time periods; (2) the Fund outperformed the average performance of its peer group funds for the one- and five-year periods, but underperformed for the three- and ten-year periods; and (3) the Fund has outperformed the average performance of comparable accounts managed by Artio for all relevant time periods with the exception of the three-year period, during which it underperformed. The Board also noted Artio’s explanation that its defensive investment positioning was a primary reason for the Fund’s underperformance.
With respect to the Eagle Investment Grade Bond Fund, the Board noted that the Fund commenced operations in March 2010 and did not yet have a full year’s worth of performance data for comparative purposes.
With respect to the Eagle Large Cap Core Fund, the Board noted the following specific factors regarding performance: (1) the Fund underperformed its benchmark index for all relevant time periods; (2) the Fund underperformed the average performance of its peer group funds for all relevant time periods; and (3) the Fund outperformed comparable institutional accounts managed by Eagle for the one-year period, but underperformed for the three- and five-year periods. The Board also noted Eagle’s explanation that its sector allocations through recent periods of slow economic recovery were the primary reasons for the Fund’s underperformance.
Renewal of Investment Advisory and Subadvisory Agreements
With respect to the Eagle Mid Cap Growth Fund, the Board noted the following specific factors regarding performance: (1) the Fund outperformed its benchmark index for all relevant time periods with the exception of the one-year period, during which the Fund underperformed; (2) the Fund outperformed the average performance of its peer group funds for all relevant time periods; (3) the Fund outperformed comparable institutional accounts managed by Eagle for all relevant time periods; and (4) the Fund’s overall 4-star Morningstar rating.
With respect to the Eagle Mid Cap Stock Fund, the Board noted the following specific factors regarding performance: (1) the Fund underperformed its benchmark index for all relevant time periods; (2) the Fund outperformed the average performance of its peer group funds for the five- and ten-year periods, but underperformed for the one- and three-year periods; (3) the Fund outperformed comparable institutional accounts managed by Eagle for the five- and ten-year periods, but underperformed for the one- and three-year periods; and (4) the Fund’s overall 4-star Morningstar rating. The Board also noted Eagle’s explanation that the primary reason for the Fund’s underperformance was due to the Fund’s conservative investment style which prevented the Fund from reaping the positive returns of high-risk investments.
With respect to the Eagle Small Cap Core Value Fund, the Board noted the following specific factors regarding performance: (1) the Fund commenced operations in November 2008; (2) the Fund outperformed its benchmark index for the one-year period; (3) the Fund outperformed the average performance of its Morningstar peer group funds for the one-year period; and (4) the Fund underperformed comparable institutional accounts managed by EBIM for the one-year period.
With respect to the Eagle Small Cap Growth Fund, the Board noted the following specific factors regarding performance: (1) the Fund outperformed its benchmark index for all relevant time periods; (2) the Fund outperformed the average performance of its peer group funds for all relevant time periods; and (3) Eagle’s representation that prior to November 1, 2008, the current portfolio management team only was responsible for a portion of the Fund’s assets, resulting in the lack of a comparable Eagle client account with which to compare the Fund’s investment performance.
Fees and expenses The Board considered the advisory fee rate payable by each Fund to Eagle under the Agreement, the subadvisory fee rate payable to a Subadviser, each Fund’s total expense ratio and its Rule 12b-1 fees. The Board also
considered comparisons of a Fund’s expense ratio (with and without Rule 12b-1 fees) to the average expense ratio of its peer group based on data ended June 30, 2010. In addition, the Board noted that Eagle had undertaken contractual and/or voluntary expense limitations with respect to the Funds for its 2010 fiscal year, which will continue for the 2011 fiscal year.
With respect to the Eagle Capital Appreciation Fund, the Board noted that the Fund’s expense ratio was higher than the average expense ratio of its peer group. With respect to GSAM’s subadvisory rate, GSAM represented its fee rate schedule is lower than the standard fee rates charged to a comparable mutual fund subadvised by GSAM. The Board noted Eagle’s representation that the Fund’s projected expense ratio for the 2010 fiscal year is lower than the expense ratio for 2009.
With respect to Eagle Growth & Income Fund, the Board noted that the Fund’s expense ratio (including the contractual cap) was higher than the average expense ratio of its peer group. With respect to Thornburg’s subadvisory fee rate, Thornburg represented it does not have any subadvised fund clients with similar investment objectives and asset levels. The Board noted Eagle’s representation that the Fund’s total assets are 17% of the average assets of the funds in the Fund’s peer group. In this regard, the Board also noted that the Fund’s assets have continued to increase since 2008 and that higher asset levels should contribute to lower expense ratios.
With respect to the Eagle International Equity Fund, the Board noted that the Fund’s expense ratio (including the contractual cap) was higher than the average expense ratio of its peer group. With respect to Artio’s subadvisory fee rate, Artio represented that its fee rate is lower than that charged to comparable fund clients.
With respect to the Eagle Investment Grade Bond Fund, the Board noted that the Fund’s expense ratio (including the contractual cap) was lower than the average expense ratio of its peer group. The Board noted that Eagle’s fee rate is higher than that charged to comparable institutional accounts. The Board also noted that for the period ended June 30, 2010, Eagle operated the Fund at a loss.
With respect to the Eagle Large Cap Core Fund, the Board noted that the Fund’s expense ratio (including the contractual cap) was higher than the average expense ratio of its peer group and the fee rate that Eagle charges to its comparably managed institutional accounts. The Board also noted that for the nine months ended June 30, 2010, Eagle operated the Fund at a loss.
Renewal of Investment Advisory and Subadvisory Agreements
With respect to the Eagle Mid Cap Growth Fund, the Board noted that the Fund’s expense ratio (including the contractual cap) was higher than the average expense ratio of its peer group. The Board noted that Eagle’s fee rate is lower than that charged to comparable institutional accounts. The Board noted Eagle’s representation that the Fund’s projected expense ratio for the 2010 fiscal year is lower than the expense ratio for 2009.
With respect to the Eagle Mid Cap Stock Fund, the Board noted that the Fund’s expense ratio (including the contractual cap) was lower than the average expense ratio of its peer group. The Board noted that Eagle’s fee rate is lower than that charged to comparable institutional accounts.
With respect to the Eagle Small Cap Core Value Fund, the Board noted that the Fund’s expense ratio (including the activities could lead to growth in the Funds’ assets and the corresponding benefits of that growth, including economies of contractual cap) was lower than the average expense ratio of its peer group. With respect to EBIM’s subadvisory fee rate, EBIM represented that its fee rate is lower than those charged to other comparable fund clients.
With respect to the Eagle Small Cap Growth Fund, the Board noted that the Fund’s expense ratio (including the contractual cap) was lower than the average expense ratio of its peer group. The Board noted that Eagle’s fee rate is lower than that charged to comparable institutional accounts.
Costs, profitability and economies of scale The Board evaluated Eagle’s and, to the extent available, each Subadviser’s costs and profitability in providing services to a Fund. The Board noted that each Subadviser’s costs and profitability generally are less significant to the Board’s evaluation of the fee rates and expenses paid by a Fund than Eagle’s advisory fee rate and profitability and the Fund’s overall expense ratios. The Board noted that Eagle’s profits on the services it provided to the Funds are reasonable in light of Eagle’s costs in providing services to each Fund and that Eagle manages each Fund’s assets and provides a comprehensive compliance program for each Fund. The Board also noted that for the nine months ended June 30, 2010, Eagle operated the Eagle Investment Grade Bond Fund, Eagle Large Cap Core Fund and Eagle Small Cap Core Value Fund at a loss.
The Board considered that the Funds’ management fee rate structures provide for breakpoints, which is a reduction of the applicable fee rate as assets increase. The Board also considered that each Fund may benefit from economies of
scale, and shareholders may realize such economies of scale, through (1) reduced advisory fees achieved when a Fund’s asset size reaches breakpoints in the fee schedules instituted by Eagle; (2) increased services to a Fund; or (3) allocation of fixed fund expenses over a large asset size.
Benefits In evaluating compensation, the Board considered other benefits that may be realized by Eagle, each Subadviser and their respective affiliates from their relationship with the Funds. In this connection, the Board noted, among other things, that Eagle is responsible for coordinating the Funds’ audits, financial statements and tax returns, and managing expenses and budgets for the Funds, and EFS will serve as the shareholder servicing agent for the Funds’ shareholders, and receives compensation for acting in these capacities. The Board noted that Eagle and its affiliates have entered into revenue sharing and services agreements with third parties for promotion and/or shareholder services.
The Board also recognized that Eagle Fund Distributors, Inc. (“Distributor”), a subsidiary of Eagle, serves as the principal underwriter and distributor for the Funds, and as such, receives Rule 12b-1 payments from the Funds to compensate it for providing services and distribution activities. These activities could lead to growth in the Funds’ assets and the corresponding benefits of that growth, including economies of scale and greater diversification. In addition, other affiliates of Eagle have entered into agreements with the Distributor to sell fund shares and receive compensation from the Distributor.
Each Subadviser also may engage in soft dollar transactions in connection with transactions on behalf of the Fund. In this regard, the Board considered each Subadviser’s process for selecting broker-dealers and for engaging in soft dollar transactions.
Conclusions Based on these considerations, the Board concluded with respect to the Funds that: (1) each Fund was reasonably likely to benefit from the nature, quality and extent of Eagle’s and each Subadviser’s services, as applicable to the Funds; (2) each Fund’s performance was satisfactory in light of all the factors considered by the Board; (3) the fees payable under the Agreements and profits earned by Eagle or a Subadviser were reasonable in the context of all the factors considered by the Board; and (4) the current advisory fee rate structure provides each Fund’s shareholders with reasonable benefits associated with economies of scale. Based on these conclusions and other factors, the Board determined in its business judgment to renew the Agreements and to approve the Agreements between each Fund and Eagle, and Eagle and each Subadviser.
Principal Risks
The greatest risk of investing in a mutual fund is that its returns will fluctuate and you could lose money. Turbulence in financial markets and reduced liquidity in equity, credit and fixed income markets may negatively affect many issuers worldwide, which could have an adverse effect on the funds. The following table identifies the primary risk factors of each fund in light of their respective principal investment strategies. These risk factors are explained following the table.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Risk | | Capital
Appreciation | | | Growth &
Income | | | International
Equity | | | Investment
Grade
Bond | | | Large
Cap Core | | | Mid Cap
Growth | | | Mid Cap
Stock | | | Small
Cap Core
Value | | | Small Cap
Growth | |
| Call | | | | | | | | | | | | | | | X | | | | | | | | | | | | | | | | | | | | | |
| Covered call options | | | | | | | X | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Credit | | | | | | | X | | | | X | | | | X | | | | | | | | | | | | | | | | | | | | | |
| Derivatives | | | | | | | | | | | X | | | | | | | | | | | | | | | | | | | | | | | | | |
| Emerging markets | | | | | | | | | | | X | | | | | | | | | | | | | | | | | | | | | | | | | |
| Focused holdings | | | X | | | | | | | | | | | | | | | | X | | | | | | | | | | | | | | | | | |
| Foreign securities | | | | | | | X | | | | X | | | | X | | | | | | | | | | | | | | | | | | | | | |
| Govt sponsored enterprises | | | | | | | X | | | | | | | | X | | | | | | | | | | | | | | | | | | | | | |
| Growth stocks | | | X | | | | X | | | | X | | | | | | | | X | | | | X | | | | X | | | | X | | | | X | |
| High-yield securities | | | | | | | X | | | | X | | | | X | | | | | | | | | | | | | | | | | | | | | |
| Inflation | | | | | | | | | | | | | | | X | | | | | | | | | | | | | | | | | | | | | |
| Interest rates | | | | | | | X | | | | X | | | | X | | | | | | | | | | | | | | | | | | | | | |
| Issuer and market | | | | | | | | | | | | | | | X | | | | | | | | | | | | | | | | | | | | | |
| Liquidity | | | | | | | | | | | X | | | | X | | | | | | | | | | | | | | | | | | | | | |
| Market timing activities | | | | | | | X | | | | X | | | | | | | | | | | | | | | | | | | | X | | | | X | |
| Mortgage- and asset-backed securities | | | | | | | | | | | | | | | X | | | | | | | | | | | | | | | | | | | | | |
| Other investment companies and ETFs | | | | | | | | | | | X | | | | X | | | | | | | | | | | | | | | | X | | | | | |
| Portfolio turnover | | | | | | | | | | | X | | | | | | | | | | | | X | | | | X | | | | | | | | | |
| Sectors | | | X | | | | | | | | X | | | | | | | | X | | | | | | | | X | | | | | | | | | |
| Small- and mid-cap companies | | | X | | | | X | | | | X | | | | | | | | | | | | X | | | | X | | | | X | | | | X | |
| Stock market | | | X | | | | X | | | | X | | | | | | | | X | | | | X | | | | X | | | | X | | | | X | |
| Value stocks | | | | | | | X | | | | | | | | | | | | X | | | | | | | | X | | | | X | | | | | |
Call | Call risk is the possibility that, as interest rates decline to a level that is significantly lower than the rate assigned to the fixed income security, the security may be called (redeemed) prior to maturity. The fund would lose the benefit of holding a fixed income security that is paying a rate above the current market rate and would likely have to reinvest the proceeds in other fixed income securities that have lower yields.
Covered call options | Because a fund may write covered call options, a fund may be exposed to risk stemming from changes in the value of the stock that the option is written against. While call option premiums may generate incremental portfolio income, they also can limit gains from market movements.
Credit | A fund could lose money if the issuer of a fixed-income security is unable to meet its financial obligations or goes bankrupt.
Credit risk usually applies to most fixed-income securities, but generally is not a factor for U.S. government obligations.
Derivatives | A fund may use derivatives such as futures contracts, forward foreign currency contracts and options on futures to adjust the risk/return characteristics of its investment portfolio. These practices, however, may present risks different from or in addition to the risks associated with investments in foreign currencies. There can be no assurance that any strategy used will succeed. If a fund’s portfolio manager incorrectly forecasts stock market values or currency exchange rates in utilizing a strategy for the fund, the fund could lose money.
Emerging markets | When investing in emerging markets, the risks mentioned below of investing in foreign securities are heightened. Emerging markets have unique risks that are
Principal Risks
greater than or in addition to investing in developed markets because emerging markets are generally smaller, less developed, less liquid and more volatile than the securities markets of the U.S. and other developed markets. There are also risks of: greater political uncertainties; an economy’s dependence on revenues from particular commodities or on international aid or development assistance; currency transfer restrictions; a limited number of potential buyers for such securities; and delays and disruptions in securities settlement procedures. In addition, there may be more volatile rates of return.
Focused holdings | For funds that normally hold a core portfolio of stocks of fewer companies than other more diversified funds, the increase or decrease of the value of a single stock may have a greater impact on the fund’s net asset value (“NAV”) and total return.
Foreign securities | Investments in foreign securities involve greater risks than investing in domestic securities. As a result, a fund’s return and NAV may be affected by fluctuations in currency exchange rates or political or economic conditions and regulatory requirements in a particular country. Foreign markets, as well as foreign economies and political systems, may be less stable than U.S. markets, and changes in the exchange rates of foreign currencies can affect the value of a fund’s foreign assets. Foreign laws and accounting standards typically are not as strict as they are in the U.S., and there may be less public information available about foreign companies. Custodial and/or settlement systems in foreign markets may not be fully developed and the laws of certain countries may limit the ability to recover assets if a foreign bank or depository or their agents goes bankrupt.
Government sponsored enterprises | Investments in government sponsored enterprises are debt obligations issued by agencies and instrumentalities of the U.S. Government. These obligations vary in the level of support they receive from the U.S. Government. They may be: (i) supported by the full faith and credit of the U.S. Treasury, such as those of the Government National Mortgage Association; (ii) supported by the right of the issuer to borrow from the U.S. Treasury, such as those of the Federal National Mortgage Association; (iii) supported by the discretionary authority of the U.S. Government to purchase the issuer’s obligations, such as those of the Student Loan Marketing Association; or (iv) supported only by the credit of the issuer, such as those of the Federal Farm Credit Bureau. The U.S. Government may choose not to provide financial support to U.S. Government sponsored
agencies or instrumentalities if it is not legally obligated to do so in which case, if the issuer defaulted, the fund holding securities of such issuer might not be able to recover its investment from the U.S. Government.
Growth stocks | Growth companies are expected to increase their earnings at a certain rate. When these expectations are not met, investors may punish the prices of stocks excessively, even if earnings showed an absolute increase. Growth company stocks also typically lack the dividend yield that can cushion stock prices in market downturns.
High-Yield securities | Investments in securities rated below investment grade, or “junk bonds”, generally involve significantly greater risks of loss of your money than an investment in investment grade bonds. Compared with issuers of investment grade bonds, junk bonds are more likely to encounter financial difficulties and to be materially affected by these difficulties. Rising interest rates may compound these difficulties and reduce an issuer’s ability to repay principal and interest obligations. Issuers of lower-rated securities also have a greater risk of default or bankruptcy. Additionally, due to the greater number of considerations involved in the selection of a fund’s securities, the achievement of a fund’s objective depends more on the skills of the portfolio manager than investing only in higher rated securities. Therefore, your investment may experience greater volatility in price and yield. High-yield securities may be less liquid than higher quality investments. A security whose credit rating has been lowered may be particularly difficult to sell.
Inflation | Inflation risk is the risk that the market value of securities will decrease as higher inflation shrinks the purchasing power of any affected currencies.
Interest rates | Investments in investment-grade and non-investment grade fixed-income securities are subject to interest rate risk. The value of a fund’s fixed income investments typically will fall when interest rates rise. A fund is particularly sensitive to changes in interest rates because it may invest in debt securities with intermediate and long terms to maturity. Debt securities with longer durations tend to be more sensitive to changes in interest rates, usually making them more volatile than debt securities with shorter durations. Yields of debt securities will fluctuate over time.
Issuer and market | Issuer and market risk is the risk that the prices of, and the income generated by, securities held by the fund may decline in response to certain events, such as
Principal Risks
general economic and market conditions, regional or global economic instability, interest rate fluctuations, and those events directly involving the issuers.
Liquidity | Liquidity risk is the possibility that the fund might be unable to sell a security promptly and at an acceptable price, which could have the effect of decreasing the overall level of the fund’s liquidity. Market developments may cause the fund’s investments to become less liquid and subject to erratic price movements. The fund could lose money if it cannot sell a security at the time and price that would be most beneficial to the fund.
Market timing activities | Because of specific securities a fund may invest in, it could be subject to the risk of market timing activities by fund shareholders. Some examples of these types of securities are high-yield, small-cap and foreign securities. Typically, foreign securities offer the most opportunity for these market timing activities. A fund generally prices these foreign securities using their closing prices from the foreign markets in which they trade, typically prior to a fund’s calculation of its NAV. These prices may be affected by events that occur after the close of a foreign market but before a fund prices its shares. In such instances, a fund may fair value foreign securities. However, some investors may engage in frequent short-term trading in a fund to take advantage of any price differentials that may be reflected in the NAV of a fund’s shares. There is no assurance that fair valuation of securities can reduce or eliminate market timing. While Eagle Fund Services, Inc. (“EFS”) monitors trading in the fund, there is no guarantee that it can detect all market timing activities.
Mortgage- and asset-backed securities | Mortgage- and asset-backed risk, which is possible in an unstable or depressed housing market, arises from the potential for mortgage failure or premature repayment of principal. The reduced value of the fund’s securities and the potential loss of principal as a result of mortgagee’s failure to repay would have a negative impact on the fund. Premature repayment of principal would make it difficult for the fund to reinvest the prepaid principal at a time when interest rates on new mortgages are declining, thereby reducing the fund’s income.
Other investment companies and ETFs | Investments in the securities of other investment companies and ETFs, (which may, in turn invest in equities, bonds, and other financial vehicles) may involve duplication of advisory fees and certain other expenses. By investing in another investment company or ETF, a fund becomes a shareholder of that investment
company or ETF. As a result, fund shareholders indirectly bear the fund’s proportionate share of the fees and expenses paid by shareholders of the other investment company or ETF, in addition to the fees and expenses fund shareholders directly bear in connection with the fund’s own operations.
As a shareholder, the fund must rely on the investment company or ETF to achieve its investment objective. If the investment company or ETF fails to achieve its investment objective, the value of the fund’s investment will decline, adversely affecting the fund’s performance. In addition, because ETFs are listed on national stock exchanges and are traded like stocks listed on an exchange, ETF shares potentially may trade at a discount or a premium. Investments in ETFs are also subject to brokerage and other trading costs, which could result in greater expenses to a fund. Finally, because the value of ETF shares depends on the demand in the market, the portfolio manager may not be able to liquidate a fund’s holdings at the most optimal time, adversely affecting the fund’s performance.
Portfolio turnover | A fund may engage in more active and frequent trading of portfolio securities to a greater extent than certain other mutual funds with similar investment objectives. A fund’s turnover rate may vary greatly from year to year or during periods within a year. A high rate of portfolio turnover may lead to greater transaction costs, result in additional tax consequences to investors and adversely affect performance.
Sectors | Companies that are in similar businesses may be similarly affected by particular economic or market events, which may, in certain circumstances, cause the value of securities of all companies in a particular sector of the market to change. To the extent a fund has substantial holdings within a particular sector, the risks associated with that sector increase.
Small- and mid-cap companies | Investments in small- and mid-cap companies generally involve greater risks than investing in large-capitalization companies. Small- and mid-cap companies often have narrower commercial markets and more limited managerial and financial resources than larger, more established companies. As a result, their performance can be more volatile and they face greater risk of business failure, which could increase the volatility of a fund’s portfolio. Generally, the smaller the company size, the greater these risks. Additionally, small- and mid-cap companies may have less market liquidity than large-cap companies.
Principal Risks
Stock market | The value of a fund’s stock holdings may decline in price because of changes in prices of its holdings or a broad stock market decline. These fluctuations could be a sustained trend or a drastic movement. The stock markets generally move in cycles, with periods of rising prices followed by periods of declining prices. The value of your investment may reflect these fluctuations.
Value stocks | Investments in value stocks are subject to the risk that their true worth may not be fully realized by the market. This may result in the value stocks’ prices remaining undervalued for extended periods of time. A fund’s performance also may be affected adversely if value stocks remain unpopular with or lose favor among investors.
2010 Federal Income Tax Notice
For the fiscal year ended October 31, 2010 certain dividends paid by the funds may be subject to a maximum tax rate of 15%, as provided for by the Jobs and Growth Tax Relief Reconciliation Act of 2004. For each applicable fund, the table below designates the maximum amount of qualified dividend income, which is 100% of what was distributed. In addition, the table designates amounts characterized as long-term capital gains which are also subject to the 15% tax rate. The information and distributions reported herein may differ from the information and distributions taxable to the shareholders for the calendar year ending December 31, 2010. All dividends paid by the Funds from net investment income are deemed to be ordinary income for federal income tax purposes. Complete information will be computed and reported in conjunction with your 2010 Form 1099-DIV.
| | | | | | | | |
| | | Qualified
dividend income | | | Long-term
capital gains | |
| Capital Appreciation Fund | | | $— | | | | $— | |
| Growth & Income Fund | | | 2,609,394 | | | | — | |
| International Equity Fund | | | — | | | | — | |
| Investment Grade Bond Fund | | | — | | | | — | |
| Large Cap Core Fund | | | 965,747 | | | | — | |
| Mid Cap Growth Fund | | | — | | | | — | |
| Mid Cap Stock Fund | | | — | | | | — | |
| Small Cap Core Value Fund | | | 694,419 | | | | — | |
| Small Cap Growth Fund | | | — | | | | — | |
Trustees and Officers
| | | | | | |
Name, birth year, position,
term of office(a) and length of
time served | | Principal occupation(s) during past five years | | Number of funds overseen in fund
complex | | Directorships
of other public
companies |
| Interested Trustee (b) |
Richard K. Riess (1949) Trustee since 1985; Chairman of the Board of Trustees since 2007 | | Executive Vice President and Managing Director for Asset Management of RJF since 1998; Chief Executive Officer of Eagle since 1996. | | 9 | | N/A |
|
| Independent Trustees |
C. Andrew Graham (1940) Trustee since 1985 | | First Financial Advisors, LTD & Graham Financial Partners, LLC (financial planning, insurance and investment services) since 1999 | | 9 | | N/A |
| | | |
Keith B. Jarrett, PhD (1948) Trustee since 2005 | | Founder, Rockport Funding, LLC (private equity), and Ajax Partners (investment partnership) since 2003; Director, Bankserv, Inc. (e-payments) since 1998; Director, Pertrac Strategic Financial Solutions (hedge fund software) since 2005; Director, Medifusion, Inc. (medical information technology) since 2007. | | 9 | | N/A |
| | | |
Lincoln Kinnicutt (1944)(c) Trustee since 2006 | | Retired since 2002; Managing Director, Goldman Sachs 1997-2002 | | 8 | | N/A |
| | | |
William J. Meurer (1943) Trustee since 2003 | | Private investor and financial consultant since 2000. | | 9 | | Sykes
Enterprises,
Inc.(d);
Walter
Investment
Management
Corporation |
| | | |
James L. Pappas (1943) Trustee since 1989; Lead Independent Trustee since 2003 | | Lykes Professor of Banking and Finance at University of South Florida 1986-2006; President, Graduate School of Banking, University of Wisconsin 1995-2005 | | 9 | | N/A |
| | | |
Deborah L. Talbot, PhD (1950) Trustee since 2002 | | Independent Consultant; Director, ethiKids, Inc. (child development) since 2009; Founder and Chairman of the Board, Creative Tampa Bay (community networking) since 2003; Deans’ Advisory Board, College of Arts and Sciences, University of Memphis since 2002. | | 9 | | N/A |
| | | | | | |
|
| Officers (e) |
Richard J. Rossi (1956) President since March 2010 | | President and Co-Chief Operating Officer of Eagle since 2009 and 2007, respectively; Executive Vice President Eagle 2000-2009; President and Director of EFD since 2005. |
| |
J. Cooper Abbott (1969) Principal Executive Officer since February 2010 | | Executive Vice President, Investments and Co-Chief Operating Officer of Eagle since 2009; Senior Vice President, Institutional Sales of Eagle 2007-2009; Director, International Sales of Asset Management Services since 2005. |
| |
Mathew J. Calabro (1966) Principal Financial Officer and Treasurer since September 2010 | | Vice President of Fund Administration for Eagle since 2008; Senior Vice President of Eagle Fund Services, Inc. (“EFS”)(f) 2005-2008; Chief Compliance Officer of Eagle Family of Funds and EFS 2005-2007. |
| |
Susan L. Walzer (1967) Chief Compliance Officer since 2007; Secretary since February 2010 | | Chief Compliance Officer of Eagle Family of Funds and EFS since 2007; Director of Compliance for EFS 2005-2007; Associate Corporate Counsel for RJF 2003-2005. |
Trustee and Officer information is current as of September 30, 2010. The Trusts’ Statement of Additional Information includes additional information about the Trustees and Officers and is available, without charge, upon request by calling 800.421.4184. The address of each Trustee and Officer is 880 Carillon Parkway, St. Petersburg, FL 33716.
(a) Trustees serve for life or until they are removed, resign or retire. The Board has adopted a Board Governance Policy that requires Independent Trustees to retire no later than at the end of the meeting which occurs immediately after his or her 72nd birthday. (b) Mr. Riess is an “interested” person of the Trust as that term is defined by the 1940 Act. Mr. Riess is affiliated with EFD, Eagle and RJF. (c) Mr. Kinnicutt is not a Trustee of the Eagle Capital Appreciation Fund. (d) Sykes Enterprises, Inc. is a technical support company. (e) Officers each serve one year terms. (f) Prior to a corporate reorganization completed on November 1, 2008, EFS was known as Heritage Asset Management, Inc. Prior to September 13, 2010, EFS served as the Funds’ transfer agent.
PRIVACY NOTICE TO CLIENTS
OF EAGLE FAMILY OF FUNDS
Eagle Asset Management, Inc., Eagle Fund Services, Inc., and Eagle Family of Funds (collectively “Eagle”) are committed to protecting confidentiality of the information furnished to us by our clients. We are providing this information as required by Regulation S-P adopted by the Securities and Exchange Commission.
Information about you that we collect:
We collect non-public personal information about you from the following sources: information we receive from you on applications or other forms or through our website; information about your transactions with us, our Affiliates, or others; and information we may receive from a consumer reporting agency.
Our use of information about you:
As permitted by law, we may share information about you with affiliated companies of Eagle. That information may include information shared by Eagle with broker-dealers and investment advisors, and information shared among other service providers of Eagle or its Affiliates, such as financial advisors and certain financial institutions with whom we have joint marketing arrangements.
In addition, we may share information about you with certain nonaffiliated third parties, including service providers, non-financial companies (e.g., software developers), and others (e.g., consulting firms) in order to help us run our business, manage your accounts, provide professional services, or help us market our products and services to you. These parties and financial institutions have agreed to treat any such information as confidential and not to share such information with other parties except as permitted by law or regulation. Otherwise, we do not disclose any non-public personal information about you to anyone except as permitted by law or regulation. You also may have other protections under applicable state laws. To the extent these state laws apply, we will comply with them when we share information about you. We follow the same policy with respect to non-public information received from all clients and former clients.
When Financial Advisors change brokerage firms:
Financial advisors may change brokerage and/or investment advisory firms and non-public personal information collected by your financial advisor may be received or taken by your financial advisor to the new firm so that he or she can continue to service your account(s) at the new firm. If you do not want your financial advisor to utilize and/or transfer this information to another firm, please contact us at 800.421.4184 to opt out of this information sharing. If your primary address is in an “opt in” state (such as California and Vermont), which requires your affirmative consent to share your non-public information with the financial advisor’s new firm, then you must give your written consent before Eagle will allow your financial advisor to take your non-public information with him or her. You can withdraw your consent at any time by contacting us at 800.421.4184.
How we protect your confidential information:
Eagle has policies that restrict access to non-public personal information about you to those employees who have need for that information to provide investment alternatives or services to you, or to employees who assist those who provide investment alternatives or services to you. We maintain physical, electronic and procedural safeguards to protect your non-public personal information.
This page is not part of the Annual Report
PN-1
eDelivery is the most convenient, economical and
environmentally-conscious way to receive information about your fund.
To enroll, please visit
eagleasset.com/eDelivery
Please consider the investment objectives, risks, charges and expenses of any fund carefully before investing. Contact Eagle at 800.421.4184 or your financial advisor for a prospectus, which contains this and other important information about the Funds. Read the prospectus carefully before you invest or send money.
This report is for the information of shareholders of the Eagle mutual funds. If you wish to review additional information on the portfolio holdings of a fund, a complete schedule has been filed with the Securities and Exchange Commission (“Commission”) for the first and third quarters of each fund’s fiscal year end on Form N-Q. These filings are available on the Commission’s website at www.sec.gov and may be reviewed and copied at the Commission’s Public Reference Room in Washington, D.C. Information on the operations of the Public Reference Room may be obtained by calling 800.SEC.0330. A description of each fund’s proxy voting policies, procedures and information regarding how each fund voted proxies relating to portfolio securities during the 12-month period ended June 30, 2010, is available without charge, upon request, by calling the Eagle Family of Funds, toll-free at the number above, by accessing our website at eagleasset.com or by accessing the Commission’s website at www.sec.gov.
| | | | |
| 727.567.8143 | | 800.421.4184 | | |
| | | | |
| | | | | | |
| Eagle Fund Distributors, Inc., Member FINRA | | Not FDIC Insured | | May Lose Value | | No Bank Guarantee |
As of the end of the fiscal period October 31, 2010, Eagle Capital Appreciation Fund ( the “Trust”) has adopted a code of ethics, as defined in Item 2 of Form N-CSR, that applies to the Principal Executive Officer and Principal Financial Officer. The Trust has not made any amendments to its code of ethics during the covered period. The Trust has not granted any waivers from any provisions of the code of ethics during the covered period. A copy of this code of ethics is filed as an exhibit to this Form N-CSR.
| Item 3. | Audit Committee Financial Expert |
The Trust’s Board of Trustees (“Board”) has determined that William J. Meurer is an audit committee financial expert, as defined in Item 3 of Form N-CSR, serving on its audit committee. Mr. Meurer is independent for purposes of Item 3 of Form N-CSR.
| Item 4. | Principal Accountant Fees and Services 1 |
(a) Audit Fees
The aggregate fees billed by the Trust’s independent public accountants, PricewaterhouseCoopers LLP (“PwC”) for professional services rendered in connection with the audit of the Trust’s annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements were $26,000 for the fiscal period ended October 31, 2009 and $29,000 for the fiscal period ended October 31, 2010.
(b) Audit-Related Fees
There were no aggregate fees PwC billed to the Trust for assurance and other services which are reasonably related to the performance of the Trust’s audit and are not reported under Item 4(a) for the fiscal periods ended October 31, 2009 and October 31, 2010. The aggregate fees PwC billed to the Trust’s investment adviser and any entity controlling, controlled by, or under common control with the Trust’s investment adviser for assurance and other services directly related to the operations and financial reporting of the Trust were $37,000 for the fiscal period ended October 31, 2009 and $0.00 for the fiscal period ended October 31, 2010.
(c) Tax Fees
The aggregate tax fees PwC billed to the Trust for tax compliance, tax advice, and tax planning services were $5,000 for the fiscal period ended October 31, 2009 and $5,000 for the fiscal period ended October 31, 2010. There were no aggregate tax fees PwC billed to the Trust’s investment adviser and any entity controlling, controlled by, or under common control with the Trust’s investment adviser for services directly related to the operations and financial reporting of the Trust for the fiscal periods ended October 31, 2009 and October 31, 2010.
| 1 | All accountant fees and services amounts are rounded to the nearest whole thousand. |
(d) All Other Fees
For the fiscal periods ended October 31, 2009 and October 31, 2010 the Trust paid PwC no other fees. There were no aggregate fees PwC billed to the Trust’s investment adviser and any entity controlling, controlled by, or under common control with the Trust’s investment adviser for any other services directly related to the operations and financial reporting of the Trust for the fiscal periods ended October 31, 2009 and October 31, 2010.
(e) The Trust’s Audit Committee Charter provides that the Audit Committee (comprised of the Independent Trustees of the Trust) is responsible for pre-approval of all auditing services performed for the Trust. The Audit Committee reports to the Board regarding its approval of the engagement of the auditor and the proposed fees for the engagement, and the majority of the Board (including the members of the Board who are Independent Trustees) must approve the auditor at an in-person meeting. The Audit Committee also is responsible for pre-approval (subject to the de minimus exception for non-audit services described in the Securities Exchange Act of 1934, as amended, and applicable rule thereunder and not expecting to exceed $5,000) of all non-auditing services performed for the Trust or for any service affiliate of the Trust. The Trust’s Audit Committee Charter also permits a designated member of the Audit Committee to pre-approve, between meetings, one or more non-audit service projects, subject to ratification by the Audit Committee at the next meeting of the Audit Committee. The Trust’s Audit Committee pre-approved all fees described above which PwC billed to the Trust.
(f) Less than 50% of the hours billed by PwC for auditing services to the Trust for the fiscal period ended October 31, 2010, were for work performed by persons other than full-time, permanent employees of PwC.
(g) There were no aggregate non-audit fees billed by PwC to the Trust and to the Trust’s investment adviser and any entity controlling, controlled by, or under common control with the Trust’s investment adviser for the fiscal periods ended October 31, 2009 and October 31, 2010.
(h) The Trust’s Audit Committee has considered the non-audit services provided to the Trust and the Trust’s investment adviser and any entity controlling, controlled by, or under common control with the Trust’s investment adviser as described above and determined that these services do not compromise PwC’s independence.
| Item 5. | Audit Committee of Listed Registrants |
Not applicable to the Trust.
| Item 6. | Schedule of Investments |
Included as part of report to shareholders under Item 1.
| Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-end Management Investment Companies |
Not applicable to the Trust.
| Item 8. | Portfolio Managers of Closed-End Management Investment Companies |
Not applicable to the Trust.
| Item 9. | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers |
Not applicable to the Trust.
| Item 10. | Submission of Matters to a Vote of Security Holders |
There have been no material changes to the Trust’s Nominating Committee Charter, which sets forth procedures by which shareholders may recommend nominees to the Board, since the Trust last provided disclosure in response to this item.
| Item 11. | Controls and Procedures |
| (a) | Based on an evaluation of the disclosure controls and procedures (as defined in Rule 30a-3(c) under the Act), the Principal Executive Officer and Principal Financial Officer of the Trust have concluded that such disclosure controls and procedures are effective as of January 06, 2011. |
| (b) | There was no change in the internal controls over financial reporting (as defined in Rule 30a-3(d) under the Act) of the Trust that occurred during the second fiscal quarter of the period covered by this report that has materially affected or is reasonably likely to materially affect, its internal control over financial reporting. |
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| (a)(1) | | Code of Ethics pursuant to Item 2 of Form N-CSR is filed and attached hereto as Exhibit 99.CODEETH. |
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| (a)(2) | | The certifications required by Rule 30a-2(a) of the Investment Company Act of 1940, as amended, and Section 302 of the Sarbanes-Oxley Act of 2002 is filed and attached hereto as Exhibit 99.CERT. |
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| (a)(3) | | Not applicable to the Trust. |
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| (b) | | The certification required by Rule 30a-2(b) of the Investment Company Act of 1940, as amended, and Section 906 of the Sarbanes-Oxley Act of 2002 is filed and attached hereto as Exhibit 99.906CERT. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Trust has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| | | | | | |
| | | | | | EAGLE CAPITAL APPRECIATION FUND |
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| Date: 01/06/2011 | | | | | | |
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| | | | | | /S/ J. COOPER ABBOTT |
| | | | | | J. Cooper Abbott |
| | | | | | Principal Executive Officer |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Trust and in the capacities and on the dates indicated. |
| | | | | | EAGLE CAPITAL APPRECIATION FUND |
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| Date: 01/06/2011 | | | | | | /S/ J. COOPER ABBOTT |
| | | | | | J. Cooper Abbott |
| | | | | | Principal Executive Officer |
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| Date: 01/06/2011 | | | | | | /S/ MATHEW J. CALABRO |
| | | | | | Mathew J. Calabro |
| | | | | | Principal Financial Officer |
