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: 811-6520
MANAGERS TRUST I
(Exact name of registrant as specified in charter)
40 Richards Avenue, Norwalk, Connecticut 06854
(Address of principal executive offices) (Zip code)
The Managers Funds LLC
40 Richards Avenue, Norwalk, Connecticut 06854
(Name and address of agent for service)
Registrant's telephone number, including area code: (203) 857-5321
Date of fiscal year end: OCTOBER 31
Date of reporting period: NOVEMBER 1, 2002 - OCTOBER 31, 2003
(Annual Shareholder Report)
Item 1. REPORT TO SHAREHOLDERS.
====================================================================
[First Quadrant logo omitted]
FIRST QUADRANT
TAX-MANAGED EQUITY FUND
=======================
Annual Report
October 31, 2003
<Page>
FIRST QUADRANT TAX-MANAGED EQUITY FUND
Annual Report
October 31,2003
TABLE OF CONTENTS
<Table>
Begins
On Page
-------
Letter to Shareholders 1
Portfolio Manager's Comments 3
Summary of Industry Weightings and Top Ten Holdings 5
Schedule of Portfolio Investments 6
Financial Statements:
Statement of Assets and Liabilities 11
Fund balance sheet, net asset value (NAV) per share
computation and cumulative undistributed amounts
Statement of Operations 12
Detail of sources of income, Fund expenses, and
Realized and unrealized gains (losses) during the
fiscal year
Statement of Changes in Net Assets 13
Detail of changes in Fund assets for the past two
fiscal years
Financial Highlights 14
Net asset value per share, total return, expense
ratios, turnover ratio and net assets
Notes to Financial Statements 15
Accounting and distribution policies, details of
Agreements and transactions with Fund management
and affiliates
Report of Independent Auditors 19
Trustees and Officers 21
</Table>
<Page>
Letter to Shareholders
- -----------------------------------------------------------------
Dear Fellow Shareholders:
The stock market has performed very well since our last report.
I believe this is due to two important factors. First, the perceived
risk in the environment is considerably lower now than it was in the
early months of 2003. This is mostly a result of the seemingly swift
success of our military in toppling the government in Iraq. Although
the war lingers on and there is great debate about how it may be
resolved, the economic impacts are better understood now than before
the war started. Second, the economy is clearly improving. The
relatively aggressive monetary stimulus applied by the Federal Reserve
over the past several years is working. The recently revised estimate
of GDP indicates that the economy grew by an annualized 8.2% during
the 3 rd quarter, which is the highest quarterly gain since 1984. As
many investors had hoped, the cost cutting and business
rationalization that has taken place over the last few years added
leverage to that growth rate. The U.S. Commerce Department recently
reported that corporate profits grew by 30% year over year, also the
largest increase since 1984. Although unemployment has yet to
significantly drop, it seems to be leveling. Meanwhile, consumer
confidence has rebounded sharply since March, and both consumer
spending and retail sales have continued to grow. Likewise, industrial
production and the Purchasing Managers Index have expanded since mid-
year.
I am pleased to note that the First Quadrant Tax-Managed Equity
Fund (the "Fund") has participated in this rally, and has provided a
return of 22.90% for the year ended October 31, 2003. While the return
is slightly behind the return of its primary index, the Russell 3000
Index, which returned 23.69% during the period, we believe that this
could be attributed to the especially strong performance of the lowest
quality stocks within the benchmark. These are investments that the
Fund typically avoids by virtue of the portfolio manager's investment
philosophy. A more detailed discussion of the Fund's results for the
year along with a description of how the portfolio is currently
positioned is included within this report.
As you are no doubt aware, certain firms in the mutual fund
industry are facing serious charges with respect to whether they and
their principals fulfilled their fiduciary duty to their clients. To
remove any confusion about this matter, I would like to provide you
with an update regarding the policies and procedures that apply to the
trading of our Funds.
We have a number of processes and procedures in place that are
designed to deter and prohibit potentially excessive trading activity
in our Funds. As outlined in our Funds' prospectus, each Fund reserves
the right to refuse any exchange request if it is determined that such
request could adversely affect the Fund, including if a person or
group has engaged in excessive trading (as determined in our sole
discretion). Our policy is to evaluate any instances of trading that
we believe may be excessive (whether large trades or potentially
excessive trading activity) on a case-by-case basis, and we have
cancelled trades and blocked accounts (and will continue to do so) as
appropriate in order to discourage and deter such activity. As further
stated in the Funds' prospectus, we also have the right to delay
sending out redemption proceeds in certain cases, and we have
explicitly reserved the absolute right to refuse a purchase order for
any reason.
The late trading under investigation is illegal under the
Investment Company Act of 1940 and other federal securities laws, and
as such our Funds have never permitted such late trading. Consistent
with applicable law and industry practice, we have relationships with
third parties that gather pre-close orders and communicate those to us
(in some cases after the market close), but such third parties are
required to make such
1
<Page>
Letter to Shareholders (continued)
- -----------------------------------------------------------------
transmissions in a manner consistent with applicable law and in
accordance with our agreements with them.
We will continue to review and, if necessary, modify our
policies, procedures and practices in an effort to ensure that we are
fulfilling our commitment to our clients, operating in compliance with
all applicable laws, rules and regulations, and prohibiting the type
of conduct described in the recent allegations.
Please be assured that we at The Managers Funds put our clients'
interests first and foremost, and we will do everything within our
power to continue to fulfill the trust that you have placed in us. We
would be happy to discuss any of these matters in greater detail with
you, and we appreciate the opportunity to serve your investment needs.
Should you have any questions about this report or the Fund in
general, please feel free to contact us at 1-800-835-3879,or visit our
website, www.managersamg.com.
Thank you for your investment.
Sincerely,
/s/ Peter M. Lebovitz
- ---------------------
Peter M.Lebovitz
President
Managers AMG Funds
2
<Page>
- ---------------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Portfolio Manager's Comments
- ---------------------------------------------------------------
In discussing the performance for the fiscal year ended October
31, 2003, I am tempted to point out the obvious - that market
performance dominated the year, more so than in any time since the
technology bubble of the late 1990's. In that kind of environment the
key to success is participating in the rally, which I am happy to
report we were able to do very effectively.
In the summary from the prior fiscal year, I commented that we
had achieved a Pyrrhic victory of sorts - beating the market by a
couple of percent is very nice, but not much to celebrate when the
market is down 15%. Although we lagged the market slightly this year,
I am much happier to report we did not achieve a Pyrrhic victory, as
the Fund was up 22.90% for the trailing 12 months. The Frank Russell
3000 benchmark for the Fund was up 23.69%, while the larger-cap S&P
500 was up 20.80%. Although the underperformance was very modest, it
nonetheless is disappointing to have to report for the first time that
we were unable to outperform the benchmark on a pre-tax basis in our
fiscal year.
Interestingly it was a difficult year for many active managers.
Market leadership changed during the course of the year. Whereas
value-oriented and defensive strategies worked well for most of the
decade to date, they did not work well over the past six months.
Instead there was a significant shift in market leadership, with
growth and technology and cyclical companies leading the rally. The
market rally was broad-based, but the highest P/E stocks led the
charge, as did the stocks with the most negative earnings, as well as
the smallest of the small cap stocks. This shift in direction,
combined with the more extreme return impact from various sectors of
the market, made for a tough active management environment. We are
very satisfied that we were able to participate as well as we did in
the rally.
Not surprisingly, our orientation has changed over the course of
the past 12 months in response to the changing market and economic
conditions:
* Initially we were more defensive and value oriented, with a
greater emphasis on the Financial Services sector and the Consumer
sector, primarily Retail. (This more defensive stance is one that we
had in place essentially from the inception of the Fund in December
2000). This stance continued to be profitable through March.
* Beginning in March our models changed their outlook, to a far
more balanced one between Value and Growth, and more neutral with
respect to Technology in particular. That change in orientation took
place through the second quarter, and the Fund underperformed in April
as the rally started. One orientation that proved to be very
profitable in both the early part of the fiscal year and through the
market rally was our smaller-cap orientation. Our models correctly
predicted that smaller-cap stocks would lead coming out of the
recession, based on historical precedent
* In the latter third of the fiscal year we moved to a slightly
more aggressive stance, with a modest increase in Technology (although
the Technology focus remained in the larger-cap, more stable sector of
the market)and a significant increase in Consumer Cyclicals and
Telecom holdings. Those positions delivered respectable returns over
that time period.
Our models continue to find that the market is fairly valued,
and we expect that with the significant increase in underlying
economic growth and productivity we are likely to see further modest
market gains. All is not roses, however, in that valuation levels are
3
<Page>
- -----------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Portfolio Manager's Comments (continued)
- -----------------------------------------------------------
becoming stretched, and in some of the more speculative areas of the
market, valuation levels are far more extreme.
We remain cautiously bullish on the U.S. economy and the U.S.
equity market. We believe stock selection will continue to drive
returns, rather than more top-down orientations. Finally, we are happy
to be able to report that our tax management practices have paid
increasing dividends (pardon the pun) in a rising market environment,
where tax management by design matters. Over the past several years
almost all managers looked like tax management experts. We believe
that this year our tax management capabilities will benefit our
shareholders far more when compared to our competition. There will
again be a very modest income dividend, but we will continue our
record of never having delivered a capital gain distribution to our
shareholders.
We thank you for your continued confidence in our ability to
manage the Fund.
Cumulative Total Return Performance
- -----------------------------------
First Quadrant Tax-Managed Equity Fund's cumulative total return is
based on the daily change in net asset value (NAV), and assumes that
all distributions were reinvested. The Russell 3000 Index (the "Index
=") measures the performance of the 3,000 largest U.S. companies based
on total market capitalization, which represents 98% of the investable
U.S. equity market. The Index assumes reinvestment of dividends. This
chart compares a hypothetical $10,000 investment made in First
Quadrant Tax-Managed Equity Fund on December 18, 2000 (commencement of
operations) to a $10,000 investment made in the Index for the same
time period. The graph and chart do not reflect the deduction of taxes
that a shareholder would pay on a Fund distribution or redemption of
shares. Past performance is not indicative of future results. Total
returns would have been lower had certain expenses not been reduced.
Value of $10,000 Investment
---------------------------
<Table>
Year End First Quadrant Tax-Managed Russell 3000
Equity Fund Index
- -------- -------------------------- ------------
Dec-00 $10,000 $10,000
Oct-01 8,910 8,109
Oct-02 7,740 6,945
Oct-03 9,512 8,590
</Table>
<Table>
One Since
Average Annualized Total returns Year Inception*
- ----------------------------------------- ------ --------
First Quadrant Tax-Managed Equity Fund 22.90% -1.73%
Russell 3000 Index 23.69% -5.16%
</Table>
Commencement of operations was December 18, 2000
4
<Page>
First Quadrant Tax-Managed Equity Fund
October 31, 2003
- -----------------------------------------------------------------
Summary of Industry Weightings (unaudited)
- -----------------------------------------------------------------
<Table>
Percentage of Percentage of
Major Sectors Net Assets Russell 3000
- ---------------------- --------------- -----------------
Financials 25.1% 21.8%
Consumer Discretionary 21.5 12.6
Health Care 9.7 13.7
Consumer Staples 4.3 9.5
Industrials 8.1 10.0
Energy 4.1 5.1
Telecommunication Services 4.7 3.2
Information Technology 19.7 18.0
Materials 2.4 3.0
Utilities 3.1 3.1
Other -2.7 0.0
</Table>
- -----------------------------------------------------------------
Top Ten Holdings (unaudited)
- -----------------------------------------------------------------
<Table>
Percentage of
Security Name Net Assets
- --------------------- --------------
Citigroup, Inc. 6.3%
Intel Corp. 5.0
Mylan Laboratories, Inc. 3.9
FedEx Corp.* 3.9
Sovereign Bancorp, Inc. 3.3
Walt Disney Co., The* 2.9
International Business Machines Corp. 2.9
Comcast Corp. 2.9
Microsoft Corp.* 2.2
H.J. Heinz Co. 2.0
------
Top Ten as a Group 35.3%
</Table>
*Top Ten Holding at April 30, 2003
5
<Page>
- ---------------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Schedule of Portfolio Investments
October 31, 2003
- ---------------------------------------------------------------
<Table>
Shares Value
------ ------
Common Stocks - 102.7%
Consumer Discretionary - 21.5%
Amazon.Com, Inc.* 5,900 (2) $ 321,078
Autozone,Inc.* 300 (2) 28,830
Comcast Corp.* 45,258 (2) 1,535,151
Comcast Corp., Special Class A* 5,300 (2) 172,886
EchoStar Communications Corp.* 2,000 (2) 76,640
General Motors Corp. 8,800 (2) 375,496
General Morors Corp., Class H* 58,500 961,155
Hilton Hotels Corp. 28,300 (2) 448,272
Hollinger International, Inc. 25,800 (2) 346,494
Home Depot, Inc. 12,100 448,547
IHOP Corp.* 8,000 296,800
Knight-Ridder, Inc. 5,900 432,588
Liberty Media Corp.* 3,000 30,270
Lowe's Co., Inc. 900 53,037
Marriott International, Inc. 13,900 600,480
Neiman-Marcus Group, Inc., Class A* 6,900 328,095
Neiman-Marcus Group, Inc., Class B 400 17,440
News Corp, Ltd. 15,200 (2) 541,880
Nike, Inc., Class B 7,100 453,690
Shaw Communications, Inc. 31,800 443,928
The Walt Disney Co. 69,500 1,573,480
Time Warner Co., Inc.* 16,400 250,756
V.F. Corp. 2,800 (2) 118,860
Washington Post Co., The 1,000 737,410
Yum! Brands, Inc.* 26,600 908,124
----------
Total Consumer Discretionary 11,501,387
----------
Consumer Staples - 4.3%
Anheuser-Busch Co., Inc. 900 44,334
CVS Corp. 800 28,144
H.J. Heinz Co. 30,800 1,088,164
PepsiAmericas, Inc. 1,000 14,980
PepsiCo, Inc. 1,200 57,384
Procter & Gamble Co. 200 19,658
Ralcorp Holdings, Inc.* 6,500 178,750
Ruddick Corp. 10,100 161,196
Safeway, Inc.* 3,100 65,410
Wal-Mart Stores, Inc. 10,800 636,660
----------
Total Consumer Staples 2,294,680
----------
</Table>
The accompanying notes are an integral part of these financial
Statements.
6
<Page>
_______________________________________________________________
First Quadrant Tax-Managed Equity Fund
Schedule of Portfolio Investments (continued)
- ---------------------------------------------------------------
<Table>
Shares Value
------ ----------
Energy - 4.1%
Amerada Hess Corp. 5,600 $ 289,072
ChevronTexaco Corp. 600 44,580
EnCana Corp. 14,600 (2) 501,802
Enterprise Products Partners LP 20,000 (2) 432,600
General Maritime Corp.* 17,000 215,050
Kerr-McGee Corp. 5,600 232,400
Pioneer Natural Resources Co.* 17,600 465,520
-----------
Total Energy 2,181,024
-----------
Financials - 25.1%
Alexandria Real Estate Equities, Inc. 6,700 341,700
American International Group, Inc. 12,931 786,593
Annaly Mortgage Management, Inc. 4,300 70,262
AON Corp. 37,000 (2) 810,300
Bank of America Corp. 1,000 75,730
Brascan Corp. 2,500 (2) 71,125
Capital One Financial Corp. 2,200 133,760
Catellus Development Corp.* 1,600 35,632
CB Bancshares, Inc. 400 25,200
Chelsea Property Group, Inc. 6,000 295,200
CIT Group, Inc.* 4,000 (2) 134,480
Citigroup, Inc. 71,500 3,389,100
Entertainment Properties Trust 18,000 579,240
Fannie Mae Co. 400 (2) 28,676
First BanCorp. 12,800 426,240
Forest City Enterprises, Inc., Class A 10,800 478,548
Forest City Enterprises, Inc., Class B 150 6,675
Golden West Financial Corp. 1,200 120,516
GreenPoint Financial Corp. 4,050 126,158
Hospitality Properties Trust 3,700 135,679
JPMorgan Chase & Co. 10,300 369,770
Leucadia National Corp. 2,100 (2) 88,200
M&T Bank Corp. 7,700 723,030
Mony Group, Inc. 8,900 (2) 284,889
Morgan Stanley Co. 4,600 252,402
New Century Financial Corp. 3,900 (2) 144,612
Provident Financial Group, Inc. 12,400 365,180
Radian Group, Inc. 200 10,580
Resource Bankshares Corp. 8,000 237,840
Sovereign Bancorp, Inc. 84,300 1,754,283
U.S. Bancorp 4,008 109,098
</Table>
The accompanying notes are an integral part of these financial
statements.
7
<Page>
- ----------------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Schedule of Portfolio Investments (continued)
- ----------------------------------------------------------------
<Table>
Shares Value
------ ----------
Financials (continued)
Wachovia Corp. 5,600 $ 256,872
Washington Mutual, Inc. 14,500 634,375
Wells Fargo & Co. 2,300 129,536
-----------
Total Financials 13,431,481
-----------
Health Care - 9.7%
Anthem, Inc.* 400 (2) 27,372
Biogen, Inc.* 1,500 60,705
Boston Scientific Corp.* 1,200 81,264
Cardinal Health, Inc. 1,700 100,878
HCA, Inc. 20,700 791,775
Health Net, Inc.* 500 15,795
Idec Pharmaceuticals Corp.* 2,400 84,312
Johnson & Johnson Co. 1,200 60,396
Laboratory Corp. of America Holdings* 1,600 56,720
Medimmune, Inc.* 1,700 45,322
Medtronic, Inc. 3,000 136,710
MGI Pharmaceuticals, Inc.* 1,000 37,560
Millennium Pharmaceuticals, Inc.* 3,800 60,496
Mylan Laboratories, Inc. 86,400(2) 2,086,560
Oxford Health Plans, Inc.* 6,300 255,150
Pfizer, Inc. 11,100 350,760
Quest Diagnostics, Inc.* 700 (2) 47,355
St.Jude Medical, Inc.* 2,400 139,584
Tenet Healthcare Corp.* 23,600 325,680
UnitedHealth Group, Inc. 5,600 284,928
Vertex Pharmaceuticals, Inc.* 3,800 49,856
WellPoint Health Networks, Inc.* 1,400 124,460
-----------
Total Health Care 5,223,638
-----------
Industrials - 8.1%
Boeing Co/The 100 3,849
Chicago Bridge & Iron Co. N.V. 28,600 779,350
FedEx Corp. 27,400 2,075,824
General Electric Co. 3,000 87,030
Genlyte Group, Inc.* 300 14,148
Robert Half International, Inc.* 8,100 (2) 191,241
United Defense Industries, Inc.* 16,800 544,320
Waste Management, Inc. 24,100 624,672
-----------
Total Industrials 4,320,434
-----------
Information Technology - 19.7%
Advanced Micro Devices, Inc.* 17,200 (2) 261,440
</Table>
The accompanying notes are an integral part of these financial
statements.
8
<Page>
- ----------------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Schedule of Portfolio Investments (continued)
- ----------------------------------------------------------------
<Table>
Shares Value
------ ----------
Information Technology (continued)
Affiliated Computer Services, Inc.* 19,000 (2) $ 929,670
Altera Corp.* 1,800 36,414
Analog Devices, Inc.* 500 22,165
Ask Jeeves, Inc.* 4,400 (2) 84,304
Automatic Data Processing, Inc. 15,600 588,744
CheckFree Corp.* 400 (2) 11,012
Cisco Systems, Inc.* 7,500 157,350
Dell, Inc.* 14,400 520,128
EarthLink, Inc.* 21,700 198,555
Factset Research Systems, Inc. 11,900 519,316
Integrated Device Technology, Inc.* 900 14,130
Intel Corp. 80,300 2,653,915
International Business Machines Corp. 17,200 1,539,056
Micron Technology, Inc.* 10,500 (2) 150,570
Microsoft Corp. 44,940 1,175,181
NCR Corp.* 23,800 855,372
Oracle Corp.* 29,200 349,232
Paychex, Inc. 2,300 89,516
Rambus, Inc.* 4,000 99,040
Sanmina-SCI Corp.* 2,400 25,320
VeriSign, Inc.* 16,100 255,507
-----------
Total Information Technology 10,535,937
-----------
Materials - 2.4%
Deltic Timber Corp. 100 2,863
Lyondell Chemical Co. 12,900 184,470
Rayonier, Inc. 8,400 353,220
Sealed Air Corp.* 12,300 654,729
Texas Industries, Inc. 4,500 122,265
-----------
Total Materials 1,317,547
-----------
Telecommunication Services - 4.7%
Alltel Corp. 10,200 482,154
AT&T Wireless Services, Inc.* 3,100 22,475
Level 3 Communications, Inc.* 194,700 (2) 1,049,433
Nextel Communications, Inc.* 10,200 246,840
SBC Communications, Inc. 2,432 58,319
Telephone & Data Systems, Inc. 9,800 613,480
Verizon Communications, Inc. 1,754 58,934
-----------
Total Telecommunication Services 2,531,635
-----------
Utilities - 3.1%
Kinder Morgan Energy Partners LP 13,800 (2) 591,192
</Table>
The accompanying notes are an integral part of these financial
statements.
9
<Page>
- ----------------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Schedule of Portfolio Investments (continued)
- ----------------------------------------------------------------
<Table>
Shares Value
------ ----------
Utilities (continued)
Texas Genco Holdings, Inc.* 8,900 $ 266,110
Xcel Energy, Inc. 49,400 810,160
-----------
Total Utilities 1,667,462
-----------
Total Common Stocks
(cost $49,229,218) 55,005,225
-----------
Other Investment Companies - 17.4%
Bank of New York Institutional Cash
Reserves Fund, 1.14% (1,3) 8,143,506 8,143,506
JPMorgan Prime Money Market Fund
Institutional Class Shares, 0.91% (1) 1,160,284 1,160,284
Total Other Investment Companies
(cost $9,303,790) 9,303,790
Total Investments - 120.1% ----------
(cost $58,533,008) 64,309,015
Other Assets, less Liabilities - (20.1)% (10,771,404)
-------------
Net Assets - 100.0% $53,537,611
=============
</Table>
Note: Based on the approximate cost of investments of $57,924,708 for
Federal income tax purposes at October 31 2003,the aggregate gross
unrealized appreciation and depreciation were $6,517,873 and
$741,866,respectively, resulting in net unrealized appreciation of
investments of $5,776,007.
*Non-income-producing securities.
(1) Yield shown for each investment company represents the October 31,
2003,seven-day average yield, which refers to the sum of the previous
seven days' dividends paid, expressed as an annual percentage.
(2) Some or all of these shares were out on loan to various brokers as
of October 31, 2003, amounting to a market value of $7,744,712, or
approximately 14.5% of net assets.
(3) Collateral received from brokers for securities lending was invested
in this short-term investment.
The accompanying notes are an integral part of these financial
statements.
10
<Page>
- ---------------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Statement of Assets and Liabilities
October 31, 2003
- ---------------------------------------------------------------
<Table>
Assets:
- --------------------
Investments at value $64,309,015
Dividends, interest and other receivables 167,947
Prepaid expenses 14,938
-----------
Total assets 64,491,900
-----------
Liabilities:
- --------------------
Payable upon return of securities loaned 8,143,506
Payable for Fund Shares purchased 2,716,736
Accrued expenses:
Investment advisory and management fees 10,321
Professional fees 36,887
Transfer agent fees 32,240
Custodian fees 10,116
Other 4,483
-----------
Total liabilities 10,954,289
-----------
Net Assets $53,537,611
===========
Shares outstanding 5,698,718
-----------
Net asset value, offering and redemption price per share $9.39
======
Net Assets Represent:
- ----------------------
Paid-in capital $114,272,564
Undistributed net investment income 2,269
Accumulated net realized loss from investments (66,513,229)
Net unrealized appreciation of investments 5,776,007
------------
Net Assets $53,537,611
============
Investments at cost $58,533,008
------------
</Table>
The accompanying notes are an integral part of these financial
statements.
11
<Page>
- ---------------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Statement of Operations
For the fiscal year ended October 31,2003
- ---------------------------------------------------------------
<Table>
Investment Income:
- -------------------------
Dividend income $ 354,400
Interest income 9,834
Securities lending fees 3,489
Foreign withholding tax (870)
----------
Total investment income 366,853
----------
Expenses:
- -------------------------
Investment advisory and management fees 185,668
Professional fees 60,356
Transfer agent 43,902
Custodian 30,221
Registration fees 24,998
Trustees fees 2,402
Miscellaneous 6,883
----------
Total expenses before expense offsets 354,430
Less: Expense reimbursement (137,008)
Net expenses 217,422
----------
Net investment income 149,431
----------
Net Realized and Unrealized Gain (Loss):
- --------------------------------------------
Net realized loss on investments (811,394)
Net unrealized appreciation of investments 6,190,281
Net realized and unrealized gain 5,378,887
---------
Net Increase in Net Assets
Resulting from Operations 5,528,318
=========
</Table>
The accompanying notes are an integral part of these financial
statements.
12
<Page>
- ---------------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Statement of Changes in Net Assets
- ---------------------------------------------------------------
<Table>
2003 2002
---- ----
Increase (Decrease) in Net Assets
From Operations:
- -------------------------------------
Net investment income $ 149,431 $ 58,732
Net realized loss on investments (811,394) (788,178)
Net unrealized appreciation
(depreciation)of investments 6,190,281 (530,123)
Net increase (decrease) in net assets --------- -----------
resulting from operations 5,528,318 (1,259,569)
--------- -----------
Distributions to Shareholders:
- -----------------------------------
From net investment income (135,306) -
--------- -----------
From Capital Share Transactions:
- -----------------------------------
Proceeds from the sale of shares 6,399,491 4,147,816
Purchase in-kind - 2,547,294
Net asset value of shares issued in
connection with reinvestment of dividends 93,189 -
Net asset value of shares issued in
connection with the merger of SMP* 41,950,130 -
Cost of shares repurchased (8,837,049) (1,218,588)
---------- -----------
Net increase from capital share
transactions 39,605,761 5,476,522
---------- -----------
Total increase in net assets 44,998,773 4,216,953
---------- -----------
Net Assets:
- ----------------------------
Beginning of period 8,538,838 4,321,885
----------- ----------
End of period $53,537,611 $8,538,838
=========== ==========
End of period undistributed
net investment income $2,269 $58,753
---------- --------
Share Transactions:
- --------------------------
Sale of shares 784,840 468,176
Shares purchased in-kind - 288,155
Shares issued in connection with
reinvestment of dividends 11,399 -
Shares issued in connection with
the merger of SMP* 4,798,688 -
Shares repurchased (998,754) (138,989)
---------- -----------
Net increase in shares 4,596,173 617,342
---------- -----------
</Table>
*See Note 6 in the Notes to Financial Statements.
The accompanying notes are an integral part of these financial
statements.
13
<Page>
- -----------------------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Financial Highlights
For a share outstanding throughout each fiscal period ended October 31,
- -----------------------------------------------------------------------
<Table>
2003 2002 2001*
----- ----- ------
Net Asset Value, Beginning of Period $7.74 $8.91 $10.00
----- ----- ------
Income from Investment Operations:
- ------------------------------------
Net investment income 0.06 0.06 0.01
Net realized and unrealized gain (loss)
on investments 1.69 (1.23) (1.10)
----- ----- ------
Total from investment operations 1.75 (1.17) (1.09)
----- ----- ------
Less Distributions to Shareholders from:
- ----------------------------------------
Net investment income (0.10) - -
----- ----- ------
Net Asset Value, End of Period $9.39 $7.74 $8.91
===== ===== ======
Total Return (a) 22.90% (13.13)% (10.90)% (b)
- ----------------------------------------------------------------------
Ratio of net expenses to average
net assets 0.99% 1.00% 1.00% (c)
Ratio of net investment income
to average net assets 0.68% 0.91% 0.29% (c)
Portfolio turnover 143% 101% 191% (b)
Net assets at end of period
(000's omitted) $53,538 $8,539 $4,322
- ----------------------------------------------------------------------
Expense Offsets (d)
- -------------------
Ratio of total expenses to average
net assets 1.62% 2.55% 4.49%(c)
Ratio of net investment income (loss)
to average net assets 0.06% (0.63)% (3.20)%(c)
</Table>
* Commencement of operations was on December 18, 2000.
(a) Total returns and net investment income would have been lower had
certain expenses not been reduced.
(b) Not annualized.
(c) Annualized.
(d) Ratio information assuming no reduction of Fund expenses.
(See Notes to Financial Statements.)
14
<Page>
- ---------------------------------------------------------------
First Quadrant Tax-Managed Equity Fund
Notes to Financial Statements
October 31, 2003
- ---------------------------------------------------------------
1) Summary of Significant Accounting Policies
- ---------------------------------------------
Managers Trust I (the "Trust") is a no-load, open-end management
investment company, organized as a Massachusetts business trust, and
registered under the Investment Company Act of 1940,as amended.
Currently, the Trust is comprised of the First Quadrant Tax-Managed
Equity Fund (the "Fund").
The Fund's financial statements are prepared in accordance with
accounting principles generally accepted in the United States of
America which require management to make estimates and assumptions
that affect the reported amount of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of income and expenses
during the reporting period. Actual results could differ from those
estimates. The following is a summary of significant accounting
policies followed by the Fund in the preparation of its financial
statements:
(a) Valuation of Investments
- ----------------------------
Equity securities traded on a domestic or international securities
exchange and over-the-counter securities are valued at the last quoted
sale price, or, lacking any sales, at the last quoted bid price.
Investments in other regulated investment companies are valued at
their end of day net asset value per share. Securities (including
derivatives) for which market quotations are not readily available are
valued at fair value, as determined in good faith, and pursuant to
procedures adopted by the Board of Trustees of the Trust.
(b) Security Transactions
- -------------------------
Security transactions are accounted for as of trade date. Realized
gains and losses on securities sold are determined on the basis of
identified cost.
(c) Investment Income and Expenses
- ----------------------------------
Dividend income is recorded on the ex-dividend date, except certain
dividends from foreign securities where the ex-dividend date may have
passed. These dividends are recorded as soon as the Trust is informed
of the ex-dividend date. Dividend income on foreign securities is
recorded net of any withholding tax. Interest income, which includes
amortization of premium and accretion of discount on debt securities
is accrued as earned. Non-cash dividends included in dividend income,
if any, are reported at the fair market value of the securities
received. Other income and expenses are recorded on an accrual basis.
Expenses which cannot be directly attributed to the Fund are
apportioned among the Funds in the Trust and, in some cases, other
affiliated funds based upon their relative average net assets or
number of shareholders.
The Fund has a "balance credit" agreement with The Bank of New York
("BNY"), the Fund's custodian, whereby the Fund is credited with an
interest factor equal to 1% below the effective 90-day T-Bill rate for
account balances left uninvested overnight. This credit serves to
reduce the custody expense that would otherwise be charged to the
Fund. For the fiscal year ended October 31,2003,the custody expense
was not reduced under this arrangement.
(d) Dividends and Distributions
- -------------------------------
Dividends resulting from net investment income and distributions of
capital gains, if any, normally will be declared and paid annually in
December and when required for Federal excise tax purposes. Income and
capital gain distributions are determined in accordance with Federal
income tax regulations which may differ from generally accepted
accounting principles. These differences are primarily due to
differing treatments for losses deferred due to wash sales,
contributed securities and possibly equalization accounting for tax.
15
<Page>
- ---------------------------------------------------------------
Notes to Financial Statements (continued)
- ---------------------------------------------------------------
purposes. Permanent book and tax basis differences, if any, relating
to shareholder distributions will result in reclassifications to paid-
in capital. The tax character of distributions paid by the Fund during
2002 and 2003 were as follows:
<Table>
2003 2002
-------- ---------
Distributions paid from:
- ------------------------
Ordinary income $135,306 $ -
Short-term capital gains - -
Long-term capital gains - -
--------- ---------
$135,306 $ -
</Table>
As of October 31, 2003, the components of distributable earnings
(excluding unrealized appreciation/depreciation) on a tax basis
consisted of:
<Table>
Capital loss carryforward $(67,119,259)
Undistributed ordinary income -
Undistributed long-term capital gains -
------------
$(67,119,259)
------------
</Table>
The Fund hereby designates the maximum amount allowable of its net
taxable income as qualified dividends as provided in the Jobs and
Growth Tax Relief Reconciliation Tax Act of 2003. The 2003 Form 1099-
DIV you receive will show the tax status of all distributions paid to
you during the year.
(e) Federal Taxes
- -----------------
The Fund intends to comply with the requirements under Subchapter M of
the Internal Revenue Code of 1986, as amended; to distribute
substantially all of its taxable income and gains to its shareholders
and to meet certain diversification and income requirements with
respect to investment companies. Therefore, no provision for Federal
income or excise tax is included in the accompanying financial
statements.
(f) Capital Loss Carryovers
- ---------------------------
As of October 31,2003,the Fund had accumulated net realized capital
loss carryovers of $11,914,908, $36,857,866 and $18,346,485. These
amounts may be used for Federal income tax purposes to offset future
realized capital gains, if any, through October 31, 2008, 2009 and
2010, respectively. In connection with the reorganization discussed in
footnote 6, the Fund inherited $69,904,066 in capital loss carryovers
is incorporated in the amounts above.
(g) Capital Stock
- -----------------
The Trust's Declaration of Trust authorizes the issuance of an
unlimited number of shares of beneficial interest, without par value.
The Fund records sales and repurchases of its capital stock on the
trade date. The cost of securities contributed to the Fund in
connection with the issuance of shares is based on the valuation of
those securities in accordance with the Fund's policy on investment
valuation. Dividends and distributions to shareholders are recorded on
the ex-dividend date.
At October 31, 2003, one unaffiliated shareholder (omnibus account)
held 40% of the outstanding shares of the Fund.
(h) Repurchase Agreements
- -------------------------
The Fund may enter into repurchase agreements provided that the value
of the underlying collateral, including accrued interest, will be
equal to or exceed the value of the
16
<Page>
- ---------------------------------------------------------------
Notes to Financial Statements (continued)
- ---------------------------------------------------------------
repurchase agreement during the term of the agreement. The underlying
collateral for all repurchase agreements is held in safekeeping by the
Fund's custodian or at the Federal Reserve Bank.
If the seller defaults and the value of the collateral declines, or if
bankruptcy proceedings commence with respect to the seller of the
security, realization of the collateral by the Fund may be delayed or
limited.
(2) Agreements and Transactions with Affiliates
- -----------------------------------------------
The Trust has entered into an Investment Management Agreement under
which The Managers Funds LLC (the "Investment Manager"), a subsidiary
of Affiliated Managers Group, Inc. ("AMG"), serves as investment
manager to the Fund and is responsible for the Fund's overall
administration. The Fund's investment portfolio is managed by First
Quadrant, L.P. ("First Quadrant"), which serves pursuant to a Sub-
Advisory Agreement by and between the Investment Manager and First
Quadrant with respect to the Fund. AMG indirectly owns a majority
interest in First Quadrant. Certain Trustees and Officers of the Fund
are Officers and/or Directors of the Investment Manager and/or AMG.
The Fund is obligated by its Investment Management Agreement to pay a
monthly management fee to the Investment Manager at an annual rate of
0.85% of the average daily net assets of the Fund. The Investment
Manager, in turn, pays First Quadrant 0.85% of the average daily net
assets of the Fund for its services as sub-advisor. Under the
Investment Management Agreement with the Fund, the Investment Manager
provides a variety of administrative services to the Fund. The
Investment Manager receives no additional compensation from the Fund
for these services. Pursuant to a Reimbursement Agreement
between the Investment Manager and First Quadrant, First Quadrant
reimburses the Investment Manager for the costs the Investment Manager
bears in providing such services to the Fund.
The Investment Manager has contractually agreed, through August 1,
2004, to waive fees and pay or reimburse the Fund to the extent total
operating expenses (excluding interest, taxes, brokerage, organization
expenses and other capitalized expenses and extraordinary expenses) of
the Fund exceed 0.99% of the Fund's average daily net assets. The Fund
is obligated to repay the Investment Manager such amounts waived, paid
or reimbursed in future years provided that the repayment occurs
within three (3) years after the waiver or reimbursement and that such
repayment would not cause the Fund's total operating expenses in any
such future year to exceed 0.99% of the Fund's average daily net
assets. At October 31,2003,the cumulative amount of unreimbursed
expenses for the Fund is $68,580.
The aggregate annual fee paid to each outside Trustee for serving as a
Trustee of the Trust is $5,000. The Trustee fee expense shown in the
financial statements represents the Fund's allocated portion of the
total fees and expenses paid by the Fund and other affiliated funds in
the Trust and in the complex.
(3) Purchases and Sales of Securities
- -------------------------------------
Purchases and sales of securities, excluding short-term securities,
for the fiscal year ended October 31, 2003 were $71,530,439 and
$30,042,671, respectively. There were no purchases or sales of U.S.
Government securities.
(4) Portfolio Securities Loaned
- ------------------------------
The Fund may participate in a securities lending program providing for
the lending of equities, corporate bonds and government securities to
qualified brokers. Collateral on all securities loaned is accepted in
cash and/or government securities. Collateral is main-
17
<Page>
- ---------------------------------------------------------------
Notes to Financial Statements (continued)
- ---------------------------------------------------------------
tained at a minimum level of 102%of the market value, plus interest,
if applicable, of the investments on loan. Collateral received in the
form of cash is invested temporarily in institutional money market
funds or other short-term investments by BNY. Earnings of such
temporary cash investments are divided between BNY, as a fee for its
services under the program, and the Fund, according to agreed-upon
rates.
(5) Commitments and contingencies
- ---------------------------------
In the normal course of business, the Funds may enter into contracts
and agreements that contain a variety of representations and
warranties, which provide general indemnifications. The maximum
exposure to the Funds under these arrangements is unknown, as this
would involve future claims that may be made against the Funds that
have not yet occurred. However, based on experience, the Funds expect
the risks of loss to be remote.
(6) Reorganization
- ------------------
On July 31, 2003, the U.S. Stock Market Plus Fund ("SMP") acquired the
assets and liabilities of the First Quadrant Tax-Managed Equity Fund
("First Quadrant Fund") in a tax-free reorganization in exchange for
shares of SMP pursuant to a plan of reorganization approved by the SMP
shareholders on July 17, 2003. The number and value of shares issued
by SMP were in amounts equal to the number and value of shares held by
First Quadrant Fund shareholders as of the reorganization date. The
number and value of shares issued in connection with the
reorganization are presented in the Statement of Changes in Net
Assets.Net assets of SMP and First Quadrant Fund as of the
reorganization date were $41,950,131 and $12,996,004, including net
unrealized appreciation of $0 and $1,856,159, respectively. Total net
assets after the reorganization were $54,946,135. For financial
reporting purposes the historical results of First Quadrant Fund will
survive. Concurrent with the reorganization, SMP was renamed to First
Quadrant Tax-Managed Equity Fund (the "Fund").
18
<Page>
- ---------------------------------------------------------------
Report of Independent Auditors
- ---------------------------------------------------------------
To the Trustees of Managers Trust I and the Shareholders of First
Quadrant Tax-Managed Equity Fund:
In our opinion, the accompanying statement of assets and liabilities,
including the schedules of portfolio investments, and the related
statements of operations and of changes in net assets and the
financial highlights, present fairly, in all material respects, the
financial position of First Quadrant Tax-Managed Equity Fund (the
"Fund"), at October 31,2003, the results of its operations, the
changes in net assets and the financial highlights for 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 Fund's management; our responsibility is
to express an opinion on these financial statements based on our
audits. We conducted our audits of these financial statements in
accordance with auditing standards generally accepted in the United
States of America, which require that we plan and perform the audits
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, 2003 by
correspondence with the custodian and brokers, provide a reasonable
basis for our opinion.
PricewaterhouseCoopers LLP
Boston, Massachusetts
December 8, 2003
19
<Page>
- ---------------------------------------------------------------
Supplemental Data
Proxy Result Information (unaudited)
- ---------------------------------------------------------------
At the Special Meeting of Shareholders of the Trust held on July 17,
2003, the following votes were recorded for First Quadrant Tax-Managed
Equity Fund (formerly Managers U.S. Stock Market Fund, the "Fund").
The proposals, which shareholders were asked to vote on, are explained
in further detail in the proxy statement dated May 28,2003:
Proposal 1(a) - To approve a new Management Agreement between The
Managers Funds LLC and Managers Trust I with respect to the Fund
<Table>
Shares For Shares Against Shares Abstained
- ------------ --------------- ----------------
2,347,462 151,864 105,472
</Table>
Proposal 1(b) - To approve a new Sub-Advisory Agreement between The
Managers Funds LLC and First Quadrant, L.P. with respect to the Fund
<Table>
Shares For Shares Against Shares Abstained
- ------------ --------------- ----------------
2,320,907 168,778 115,113
Proposal 2(a) - To approve amendments to the Fund's fundamental
investment policy regarding senior securities and borrowing
</Table>
<Table>
Shares For Shares Against Shares Abstained
- ------------ --------------- ----------------
2,330,567 159,456 114,775
</Table>
Proposal 2(b)- To approve amendments to the Fund's fundamental
investment policy regarding real estate
<Table>
Shares For Shares Against Shares Abstained
- ------------ --------------- ----------------
2,309,684 177,662 117,451
</Table>
Proposal 2(c)- To approve amendments to the Fund 's fundamental
investment policy regarding commodities
<Table>
Shares For Shares Against Shares Abstained
- ------------ --------------- ----------------
2,299,769 182,188 122,841
</Table>
Proposal 2(d) - To approve amendments to the Fund's fundamental
investment policy regarding loans
<Table>
Shares For Shares Against Shares Abstained
- ------------ --------------- ----------------
2,310,753 178,002 116,044
</Table>
Pursuant to Article III, Section 1 of the By-Laws of the Trust and the
1940 Act, such total votes on each proposal represents a quorum of the
outstanding shares of the Funds.
20
<Page>
- ---------------------------------------------------------------
Trustees and Officers
- ---------------------------------------------------------------
Trustees and Officers of the Trust
The Trustees and Officers of the Trust, their business addresses,
principal occupations for the past five years and dates of birth are
listed below. The Trustees provide broad supervision over the affairs
of the Trust and the Fund. Unless otherwise noted, the address of each
Trustee or Officer is the address of the Trust: 40 Richards Avenue,
Norwalk, Connecticut 06854.
The Trustees hold office without limit in time except that (a) any
Trustee may resign; (b) any Trustee may be removed with or without
cause by action of the Trustees.
The President, Chief Financial Officer, Treasurer and Secretary of the
Trust are elected by the Trustees and hold office until their
respective successors are chosen and qualified.
Independent Trustees
- --------------------
The following Trustees are not "interested persons" of the Trust
within the meaning of the 1940 Act:
<Table>
POSITION(S) HELD NUMBER OTHER
NAME WITH FUND AND PRINCIPAL OCCUPATIONS OF FUNDS IN DIRECTORSHIPS
AND DATE LENGTH OF TIME DURING PAST 5 YEARS FUND COMPLEX* HELD BY TRUSTEE
OF BIRTH SERVED OVERSEEN BY
TRUSTEE
- ------------- ---------------- --------------------- ------------- ---------------------------
Jack W.Aber Trustee since Professor of Finance, 30 Trustee of Appleton Growth
DOB: 9/9/37 2000 Boston University Fund (1 portfolio);
School of Management Trustee of Third Avenue
(1972-Present) Trust (4 portfolios);
Trustee of Third Avenue
Variable Series Trust
(1 portfolio)
- ------------- ---------------- --------------------- ------------- ----------------------------
William E. Trustee since President and Owner, 30 Trustee of Third Avenue
Chapman,II 2000 Longboat Retirement Trust (4 portfolios);
DOB: 9/23/41 Planning Solutions Trustee of Third Avenue
(1998-Present); Variable Series Trust
Hewitt Associates,LLC (1 portfolio)
(part time)(provider
of Retirement and
Investment Education
Seminars); President,
Retirement Plans Group,
Kemper Funds (1990-1998)
- ------------- ---------------- ---------------------- ------------- ---------------------------
</Table>
21
<Page>
Trustees and Officers (continued)
<Table>
POSITION(S) HELD NUMBER OTHER
NAME WITH FUND AND PRINCIPAL OCCUPATIONS OF FUNDS IN DIRECTORSHIPS
AND DATE LENGTH OF TIME DURING PAST 5 YEARS FUND COMPLEX* HELD BY TRUSTEE
OF BIRTH SERVED OVERSEEN BY
TRUSTEE
- ------------- ---------------- --------------------- ------------- ---------------------------
Edward J. Trustee since Partner, Hepburn Willcox 30 Trustee of Third Avenue
Kaier 2000 Hamilton & Putnam (1977- Trust (4 portfolios);
DOB: 9/23/45 Present) Trustee of Third Avenue
Variable Series Trust
(1 portfolio)
- ------------- ---------------- ---------------------- ------------- ---------------------------
Madeline H. Trustee since Member,Investment 22 None
McWhinney 2000 Committee, New Jersey
DOB :3/11/22 Supreme Court (1990-
Present); Member,
Advisory Board on
Professional Ethics,
New Jersey Supreme
Court (1983-1998);
President, Dale, Elliott
& Company, Inc.
(Management Consultant)
(1977-1994)
- ------------- ---------------- ---------------------- ------------- ---------------------------
Steven J. Trustee since Private Investor; 22 Trustee of Professionally
Paggioli 2000 Executive Vice President, Managed Portfolios
DOB:4/3/50 Secretary and Director, (19 portfolios)
Investment Company
Administration, LLC
(1990-2001); Trustee,
Professionally Managed
Portfolios, (1991-Present);
Consultant, formerly
Executive Vice President
and Director, The
Wadsworth Group (1986-
2001); Vice President,
Secretary and Director,
First Fund Distributors,
Inc.(1991-2001)
- ------------- ---------------- ---------------------- ------------- ---------------------------
</Table>
22
<Page>
<Table>
POSITION(S) HELD NUMBER OTHER
NAME WITH FUND AND PRINCIPAL OCCUPATIONS OF FUNDS IN DIRECTORSHIPS
AND DATE LENGTH OF TIME DURING PAST 5 YEARS FUND COMPLEX* HELD BY TRUSTEE
OF BIRTH SERVED OVERSEEN BY
TRUSTEE
- ------------- ---------------- --------------------- ------------- ---------------------------
Eric Rakowski Trustee since Professor, University of 30 Trustee of Third Avenue
DOB:6/5/58 2000 California at Berkeley Trust (4 portfolios)
School of Law (1990- Trustee of Third Avenue
Present); Visiting Variable Series Trust
Professor, Harvard Law (1 portfolio)
School (1998-1999)
- ------------- ---------------- ---------------------- ------------- ---------------------------
Thomas R. Trustee since Professor of Finance, 22 None
Schneeweis 2000 University of Massa-
DOB :5/10/47 chusetts (1985-Present);
Managing Director,
CISDM at the University
of Massachusetts, (1994-
Present); President and
Chief Executive Officer,
Schneeweis Partners, LLC
(2001-Present)
- ------------- ---------------- ---------------------- ------------- ---------------------------
</Table>
* The Fund complex consists of Managers Trust I, The Managers Funds,
Managers AMG Funds and Managers Trust II.
23
<Page>
- -------------------------------------------------------
Trustees and Officers (continued)
- -------------------------------------------------------
Interested Trustees
- -------------------
The following Trustees are "interested persons" of the Trust within
the meaning of the 1940 Act. Mr.Healey is an interested person of
the Trust within the meaning of the 1940 Act by virtue of his
positions with, and interest in securities of, Affiliated Managers
Group, Inc. Mr.Lebovitz is an interested person of the Trust within
the meaning of the 1940 Act by virtue of his positions with The
Managers Funds LLC and Managers Distributors, Inc.
<Table>
POSITION(S) HELD NUMBER OTHER
NAME WITH FUND AND PRINCIPAL OCCUPATIONS OF FUNDS IN DIRECTORSHIPS
AND DATE LENGTH OF TIME DURING PAST 5 YEARS FUND COMPLEX* HELD BY TRUSTEES
OF BIRTH SERVED OVERSEEN BY
TRUSTEE
- ------------- ---------------- --------------------- ------------- ---------------------------
Sean M.Healey Trustee since President and Chief 30 None
DOB:5/9/61 2000 Operating Officer,
Affiliated Managers
Group,Inc.(1999-Present);
Director,Affiliated
Managers Group,Inc.
(2001-Present);
Executive Vice President,
Affiliated Managers Group,
Inc.(1995-1999); Vice
President, Goldman, Sachs
& Company (1987-1995)
- ------------- ---------------- --------------------- ------------- ---------------------------
Peter M. President since President and Chief 30 None
Lebovitz 2002; President Executive Officer,
DOB: 1/18/55 since 2000 The Managers Funds
LLC (1999-Present);
President, Managers
Distributors, Inc. (2000-
Present); Director of
Marketing, The Managers
Funds, LP (1994-1999);
Director of Marketing,
Hyperion Capital
Management, Inc. (1993-
1994); Senior Vice
President, Greenwich
Asset Mgmt.,Inc. (1989-
1993)
- ------------- ---------------- --------------------- ------------- ---------------------------
</Table>
* The Fund complex consists of Managers Trust I, The Managers Funds,
Managers AMG Funds and Managers Trust II.
24
<Page>
- -------------------------------------------------------------
Trustees and Officers (continued)
- -------------------------------------------------------------
Officers
- --------
<Table>
POSITION(S) HELD
NAME WITH FUND AND PRINCIPAL OCCUPATIONS
AND DATE LENGTH OF TIME DURING PAST 5 YEARS
OF BIRTH SERVED
- ------------- ---------------- --------------------------------------
Galan G.Daukas Chief Financial Chief Operating Officer,The Managers
DOB:10/24/63 Office since 2002 Funds LLC (2002-Present); Chief Financial
Officer The Managers Funds, Managers Trust
I and Managers AMG Funds (2002-Present);
Chief Operating Officer
and Chairman of the Management Committee,
Harbor Capital Management Co., Inc. (2000-
2002); Chief Operating Officer, Fleet
Investment Advisors (1992-2000)
- ------------- ---------------- ---------------------------------------
Donald S. Treasurer and Director, Finance and Planning, The
Rumery Secretary since Managers Funds LLC,(1994-Present);
DOB:5/29/58 2000 Treasurer and Chief Financial Officer,
Managers Distributors, Inc. (2000-Present);
Treasurer, The Managers Funds (1995-Present);
Secretary, The Managers Funds (1997-Present);
Treasurer and Secretary, Managers Trust II
(2000-Present); Treasurer, Managers AMG Funds
(1999-Present)
- ------------- ---------------- --------------------------------------
</Table>
* The Fund complex consists of Managers Trust I, The Managers Funds,
Managers AMG Funds and Managers Trust II.
25
<Page>
Administrator
- -------------
The Managers Funds LLC
40 Richards Avenue
Norwalk, Connecticut 06854-2325
(203)857-5321 or (800)835-3879
Distributor
- -----------
Managers Distributors, Inc.
40 Richards Avenue
Norwalk, Connecticut 06854-2325
(203)857-5321 or (800)835-3879
Custodian
- ---------
The Bank of New York
100 Church Street, 10th Floor
New York, New York 10286
Legal Counsel
- -------------
Goodwin Procter LLP
Exchange Place
Boston, Massachusetts 02109-2881
Transfer Agent
- --------------
Boston Financial Data Services, Inc.
attn: The Managers Funds
P.O. Box 8517
Boston, Massachusetts 02266-8517
(800)252-0682
For ManagersChoice Only
- -----------------------
PFPC Brokerage Services,Inc.
P.O. Box 61487
King of Prussia, Pennsylvania 19406
(800) 358-7668
Trustees
- --------
Jack W. Aber
William E. Chapman,II
Sean M. Healey
Edward J. Kaier
Peter M. Lebovitz
Madeline H. McWhinney
Steven J. Paggioli
Eric Rakowski
Thomas R. Schneeweis
<Page>
The Managers Funds
==================
Equity Funds:
- -------------
VALUE FUND
Armstrong Shaw Associates Inc.
Osprey Partners Investment Mgmt., LLC
CAPITAL APPRECIATION FUND
Essex Investment Management Co., LLC
Bramwell Capital Management, Inc.
SMALL COMPANY FUND
Kalmar Investment Advisers, Inc.
SPECIAL EQUITY FUND
Donald Smith & Co., Inc.
Pilgrim Baxter &Associates, Ltd.
Westport Asset Management, Inc.
Kern Capital Management LLC
Skyline Asset Management, L.P.
INTERNATIONAL EQUITY FUND
Lazzard Asset Management, LLC
Bernstein Investment Research and Management
Mastholm Asset Management, L.L.C.
EMERGING MARKETS EQUITY FUND
Rexiter Capital Management Limited
FIRST QUADRANT TAX-MANAGED EQUITY FUND
First Quadrant, L.P.
Income Funds:
- -------------
BOND FUND
Loomis,Sayles & Co. L.P.
GLOBAL BOND FUND
Loomis, Sayles & Co. L.P.
INTERMEDIATE DURATION GOVERNMENT FUND
Smith Breeden Associates, Inc.
TOTAL RETURN BOND FUND
Merganser Capital Management LP
SHORT DURATION GOVERNMENT FUND
Smith Breeden Associates, Inc.
MONEY MARKET FUND
J.P. Morgan Fleming Asset Management
(USA), Inc.
Managers AMG Funds
==================
Equity Funds:
- -------------
ESSEX AGGRESSIVE GROWTH FUND
ESSEX LARGE CAP GROWTH FUND
Essex Investment Management Company, LLC
RORER LARGE-CAP FUND
RORER MID-CAP FUND
Rorer Asset Management, LLC
SYSTEMATIC VALUE FUND
Systematic Financial Management, L.P.
BURRIDGE SMALL CAP GROWTH FUND
The Burridge Group LLC
This report is prepared for the information
of shareholders. It is authorized for
distribution to prospective investors only
when preceded or accompanied by an
effective prospectus, which is available by
calling 1-800-835-3879. Distributed by Managers
Distributors, Inc., member NASD.
www.managersamg.com
www.managersfunds.com
www.managerschoice.com
<Page>
Item 2. CODE OF ETHICS.
====================================================================
Registrant has adopted a Code of Ethics. See attached Exhibit 10(a).
Item 3. AUDIT COMMITTEE FINANCIAL EXPERT.
====================================================================
Registrant's Board of Trustees has determined that independent Trustees
Mr. Jack W. Aber and Steven J. Paggioli each qualify as the Audit
Committee Financial Expert. Mr. Aber and Mr. Paggioli are
"independent" as such term is defined in Form N-CSR.
Item 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
====================================================================
Not applicable.
Item 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
====================================================================
Not applicable.
Item 6. [RESERVED]
====================================================================
Item 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR
CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
====================================================================
Not applicable.
Item 8. [RESERVED]
====================================================================
Item 9. CONTROLS AND PROCEDURES.
====================================================================
(a) Disclosure Controls and Procedures. The Principal Executive
and Financial Officers concluded that the Registrant's
Disclosure Controls and Procedures are effective based on
their evaluation of the Disclosure Controls and Procedures as
of a date within 90 days of the filing of this report.
(b) Internal Controls. There were no significant changes in the
Registrant's internal controls or in other factors that could
significantly affect these controls subsequent to the date of
our evaluation, including any corrective actions with regard
to significant deficiencies and material weaknesses.
<Page>
Item 10. EXHIBITS
====================================================================
(a) Any code of ethics or amendments hereto. Filed herewith.
(b) Certifications pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002. Filed herewith.
(c) Certifications pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002. Filed herewith.
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SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934 and
the Investment Company Act of 1940, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly
authorized.
MANAGERS TRUST I
By: /s/ Peter M. Lebovitz
----------------------------
Peter M. Lebovitz, President
Date: December 19, 2003
-----------------
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 registrant and in the
capacities and on the dates indicated.
By: /s/ Peter M. Lebovitz
----------------------------
Peter M. Lebovitz, President
Date: December 19, 2003
-----------------
By: /s/ Galan G. Daukas
----------------------------------------
Galan G. Daukas, Chief Financial Officer
Date: December 19, 2003
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