================================================================================
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 811-0792
CNI CHARTER FUNDS
(Exact name of registrant as specified in charter)
----------
400 North Roxbury Drive
Beverly Hills, CA 90210
(Address of principal executive offices) (Zip code)
SEI Investments Distributors
1 Freedom Valley Drive
Oaks, PA 19456
(Name and address of agent for service)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 1-888-889-0799
DATE OF FISCAL YEAR END: SEPTEMBER 30, 2009
DATE OF REPORTING PERIOD: SEPTEMBER 30, 2009
================================================================================
EXPLANATORY NOTE
----------------
The purpose of this Amendment on Form N-CSR/A to the CNI Charter Funds
Shareholder Report for the fiscal year ended September 30, 2009, which was filed
with the Securities and Exchange Commission on December 7, 2009 (Accession
Number 0000950123-09-068730), is to amend various share amounts within the CNI
Large Cap Growth Fund's Schedule of Investments. The CNI Charter Funds
Shareholder Report that was printed and distributed to shareholders was correct
and did not need to be amended.
ITEM 1. REPORTS TO STOCKHOLDERS.
(CNI CHARTER FUNDS(SM)LOGO)
(GRAPHIC)
2009 ANNUAL REPORT
SEPTEMBER 30, 2009
(GRAPHIC)
This report and the financial statements contained herein are provided
for the general information of the shareholders of the CNI Charter Funds. This
report is not authorized for distribution to prospective investors in the CNI
Charter Funds unless preceded or accompanied by an effective prospectus. Please
remember that past performance is no guarantee of future results.
Shares of CNI Charter Funds are not deposits or obligations of any bank, are not
guaranteed by any bank, are not insured by the FDIC or any other agency and
involve investment risks, including the possible loss of the principal amount
invested.
TABLE OF CONTENTS
CNI Charter Funds Annual Report
2 Letter to Our Shareholders
4 Equity and Blended Funds Investment Adviser's Report
7 Equity and Blended Funds Overview
12 Fixed Income Funds Investment Adviser's Report
14 Fixed Income Funds Overview
18 Money Market Funds Investment Adviser's Report
20 Schedules of Investments
62 Statements of Assets & Liabilities
65 Statements of Operations
68 Statements of Changes in Net Assets
72 Financial Highlights
75 Notes to Financial Statements
84 Report of Independent Registered Public Accounting Firm
86 Trustees and Officers
89 Notice to Shareholders
90 Disclosure of Fund Expenses
92 Board Approval of Investment Advisory Agreements
- --------------------------------------------------------------------------
The Funds file their complete schedules of portfolio holdings with the
Securities and Exchange Commission for the first and third quarters of each
fiscal year on Form N-Q within sixty days after the end of the period.The Funds'
Form N-Q is available on the Commission's website at http://www.sec.gov, and may
be reviewed and copied at the Commission's Public Reference Room in Washington,
DC. Information on the operation of the Public Reference Room may be obtained by
calling 1-800-SEC-0330.The most current Form N-Q is also available on the Funds'
website at www.cnicharterfunds.com and without charge, upon request, by calling
1-888-889-0799.
A description of the policies and procedures that the Funds use to determine how
to vote proxies relating to the Funds' portfolio securities, and information on
how the Funds voted proxies relating to portfolio securities during the most
recent 12-month period ending June 30 is available (1) without charge, upon
request, by calling 1-888-889-0799, (2) on the Funds' website at
www.cnicharterfunds.com, and (3) on the Securities and Exchange Commission's
website at www.sec.gov.
CNI CHARTER FUNDS | PAGE 1
letter to our shareholders
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
This annual report covers CNI Charter Funds for the fiscal year ended September
30, 2009. On the following pages, you will find the specific details of each
Fund's portfolio and investment performance.
Despite unprecedented economic and financial market turmoil, our unique
philosophy and disciplined approach to capital market investment continued to
show well over the last twelve months. Strict adherence to our underlying
investment philosophy and continued reliance on the basic fundamentals of
prudent investing proved successful once again as we steered through the
financial carnage occurring over the past twelve months.
The beginning months of our fiscal year witnessed a panic and ensuing "flight to
quality" of historic proportion. U.S.Treasury securities represented the sole
safe-haven during the final months of 2008 and beginning of 2009.All other risky
assets, including high yield and corporate bonds, domestic and international
equities, commodities, hedge funds and private equity produced double digit
losses.
As the global economic crisis deepened and central banks around the world
collaborated to prevent a global depression, interest rates, stock prices,
housing prices and economic activity in general dropped precipitously. (See
table below).
SIX-MONTH MARKET OCT 2008 TO APR 2009 TO
PERFORMANCE: MAR 2009 SEPT 2009
Treasury Bill 7.3% -1.0%
S&P 500 -30.5% 34.0%
Small Cap Stocks (Russell 2000) -37.2% 44.0%
International Stocks (MSCI EAFE) -31.1% 49.9%
Emerging Markets (MSCI EM) -26.9% 62.9%
High Yield Bonds
(Barclays Corporate HY) -13.0% 40.6%
Commodities (DJ UBS) -34.5% 16.4%
Hedge Funds
(HFRI Fund of Funds Composite) -9.7% 9.4%
Private Equity
(Red Rocks Global Listed PE) -58.7% 89.7%
Real Estate (NAREIT) -55.4% 67.7%
Then, as quickly and sharply as the markets fell, they began to recover in early
March. (See second column of figures above).
The "flight-to-quality" witnessed over the prior six-months quickly morphed into
a "flight-from-quality." The markets did a virtual about-face in March, with
risky assets gaining and treasury bills falling.
The economy began to evidence signs of stabilization, and eventually, some
promising hints of recovery. Through the second half of our fiscal year, ending
September, risky assets recovered most of the value they lost in the first half
of the period.
City National Asset Management, Inc.'s underlying investment philosophy is to
pursue the long-term goals and objectives specified for each of the Funds. With
an active yet disciplined style, all Funds are managed to achieve competitive
rates of return consistent with their respective, prescribed risk parameters.
CNI Charter Funds follow a disciplined investment process that begins with a
thorough assessment of the macroeconomic environment and the financial markets.
Our broad based research process takes advantage of the most advanced investment
technology, fundamental valuation, and quantitative tools to determine the most
attractive sectors and securities within each Fund's area of concentration. The
final step is to construct and continuously monitor precise portfolios that meet
the objectives of the specific Funds, without being swayed by short-term trends
and fads.This approach continued to serve shareholders well during the extreme
gyrations in the markets and unprecedented economic events encountered in the
period ended September 30, 2009.
CNI CHARTER FUND PERFORMANCE AND HIGHLIGHTS
(ALL RETURNS LISTED REFER TO INSTITUTIONAL CLASS SHARES)
By adhering to our basic investment discipline and maintaining the appropriate
amount of risk control in the various portfolios, the Funds continued to provide
returns that are competitive in their respective investment arenas.
CNI CHARTER FUNDS | PAGE 2
- --------------------------------------------------------------------------------
Although three of our four equity funds dropped in value for the year ending
September 30, 2009, they all showed significant strength in the latter
six-months and all performed relatively well against their respective investment
benchmarks.
Our LARGE CAP VALUE EQUITY FUND lost 10.0% versus a 11.4% loss for its S&P
500/Citigroup Value Index benchmark.The LARGE CAP GROWTH EQUITY FUND lost 3.4%
over the twelve-month period, versus a 2.6% loss for its S&P/Citigroup Growth
Index benchmark.The RCB SMALL CAP VALUE EQUITY FUND showed the strongest
turnaround and relative out-performance by far, gaining 15.2% for the twelve
month period despite a 12.6% loss to its Russell 2000 Value Equity Index
benchmark. Lastly, the OPPORTUNISTIC VALUE FUND dropped 6.8% in value compared
to its Russell 1000 Value Index benchmark loss of 10.6%.
The MULTI-ASSET FUND, which was specifically designed to buffer against the
harmful effects of a bear market, did just that during this rocky period
sporting a 3.5% gain.
All four of the CNI Charter Bond Funds showed positive returns for the year
ending September 30, 2009.The HIGH YIELD BOND FUND led the pack by gaining
12.9%, with the CORPORATE BOND FUND not far behind (up 12.5%).The GOVERNMENT
BOND FUND and CALIFORNIA TAX-EXEMPT BOND FUND returned 5.2% and 8.5%,
respectively.
Lastly, all three of the CNI Charter Money Market Funds produced steady,
consistent, and competitive returns.These returns were in line with their
respective investment mandates.
Please read the following pages carefully as they contain important information
on the assets and financial condition of the Funds. If you have any questions
about this report or CNI Charter Funds, please call your investment professional
or (888) 889-0799.
Thank you for choosing CNI Charter Funds.
Sincerely,
/s/ Richard A. Weiss
--------------------------------------
Richard A.Weiss
CHAIRMAN AND PRESIDENT
CITY NATIONAL ASSET MANAGEMENT, INC.
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. CERTAIN SHAREHOLDERS MAY BE
SUBJECT TO THE ALTERNATIVE MINIMUM TAX (AMT). FEDERAL INCOME TAX RULES APPLY TO
ANY CAPITAL GAIN DISTRIBUTIONS.
FUND EXPENSES HAVE BEEN WAIVED DURING THE PERIOD ON WHICH THE PERFORMANCE IS
BASED.WITHOUT WAIVERS, PERFORMANCE WOULD BE LOWER.
THIS INFORMATION MUST BE PRECEDED OR ACCOMPANIED BY A CURRENT PROSPECTUS. PLEASE
READ THE PROSPECTUS CAREFULLY BEFORE INVESTING. INVESTING IN MUTUAL FUNDS
INVOLVES RISK, INCLUDING POSSIBLE LOSS OF PRINCIPAL. IN ADDITIONAL TO THE NORMAL
RISKS ASSOCIATED WITH INVESTING, INVESTMENTS IN SMALLER COMPANIES TYPICALLY
EXHIBIT HIGHER VOLATILITY. AN INVESTMENT IN THE FUNDS IS NOT INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT
AGENCY. NOTWITHSTANDING THE PRECEDING STATEMENTS, UNTIL SEPTEMBER 18, 2009
SHAREHOLDERS OF THE CNI CHARTER PRIME MONEY MARKET FUND AND CALIFORNIA TAX
EXEMPT MONEY MARKET FUND WERE GUARANTEED TO RECEIVE $1.00 PER SHARE FOR AMOUNTS
THAT THEY HELD AS OF SEPTEMBER 19, 2009 SUBJECT TO THE TERMS OF THE U.S.TREASURY
DEPARTMENT'S TEMPORARY GUARANTEE PROGRAM FOR MONEY MARKET FUNDS.
- --------------------------------------------------------------------------------
*NOT FDIC INSURED *NO BANK GUARANTEE *MAY LOSE VALUE
CNI CHARTER FUNDS | PAGE 3
investment adviser's report
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
EQUITY AND BLENDED FUNDS
For the fiscal year ending September 30, 2009, the U.S. equity market, as
measured by the S&P 500 Index, returned -6.9%. Market volatility during the past
12 months was historic.The S&P 500 was down 41.2% from the start of the period
through March 9, 2009, the current market low. From that point through the end
of September, the market gained 58.2%. However, the market is still down about
34% from the October 2007 market high.
The start of the fourth quarter of 2008 found investors in the midst of a severe
liquidity crisis. Banks were hoarding cash and not lending to one another and
the commercial paper market had ground to a halt.A cloud of fear and uncertainty
enveloped investors.The government stepped in to protect the banking sector with
its $700 billion Troubled Asset Relief Program (TARP) and helped increase
investor confidence with economic stimulus packages.As a result, the market
rallied about 25% from its late November 2008 lows to early January as investors
turned the page hoping for a better year in 2009.
As 2009 started, the market remained clearly within the bear's clutches. Fears
abounded with respect to U.S. banks and whether government support would dilute
the value of common stockholders. Concern also spread overseas with respect to
the effect this crisis was having on European banks. Economic indicators
continued to flash warning signs as businesses contracted due to this negative
environment.And early March brought clear panic as investors sold stocks to
salvage whatever value they could from depressed securities.This clearly was a
period that shook investor confidence in the American financial system.
Late March 2009 started a market rally, although most investors were not aware
of it at the time, as is typically the case.The new U.S. administration was
planning to assist banks in the removal of toxic assets from their balance
sheets as well as assist frozen credit markets.The market rally continued into
the summer on the backs of better-than-expected earning numbers.As we ended this
fiscal period, most investors were very happy with the big gains off the March
lows, but still very cautious regarding the strength and durability of the
economic recovery.
EQUITY AND BLENDED FUND PERFORMANCE
(ALL RETURNS LISTED FOR CNI CHARTER FUNDS REFER TO INSTITUTIONAL CLASS SHARES)
o The LARGE CAP VALUE EQUITY FUND fell 10.0% during the 12 months
ending September 30, 2009.This performance outperformed the
S&P500/Citigroup Value Index return of -11.4%, but trailed the
Lipper Large Cap Value Funds Classification return of -7.9%.Although
the financial sector as a whole was the worst performing sector last
year, Goldman Sachs' share price managed to gain 46%. Goldman was
able to avoid many of the major issues plaguing other banks and
generated earnings via their trading unit. Goodrich Corp., a leader
in aerospace systems, returned 33.9%. Goodrich beat earnings
estimates due to cost costs and increased revenue from the defense
and space channel. Perkinelmer, a leading provider of analysis tools
and medical imaging, fell 21.3% but continued to beat earnings
expectations in this economic downturn. Norfolk Southern, the fourth
largest U.S. railroad, lost 32.8% due to decreased volumes in rail
traffic, particularly in coal shipments.
o The LARGE CAP GROWTH EQUITY FUND lost 3.4% during the 12 months
ending September 30, 2009.This performance slightly trailed both the
S&P500/Citigroup Growth Index return of -2.6% and the Lipper Large
Cap Growth Funds Classification return of -2.7%.Apple Inc. was a
standout during this time period, gaining 63.1%.
CNI CHARTER FUNDS | PAGE 4
- --------------------------------------------------------------------------------
Sales across all three product lines (iPhone, iPod, and Mac) remain
strong even in this tough economic environment. Freeport-McMoran,
the largest publicly traded copper producer, gained 22.4%, as the
company cut costs and positioned the company well in this tough
economic period. Energy service provider Smith International lost
50.1%.This was mainly due to the drop in drilling activity as oil
prices dropped from a high of $150 per barrel to a low in the mid
$30s, ending the period around the $70 mark. Genzyme, the world's
largest maker of drugs for genetic disorders, lost 29.9% due to
deficiencies in a major manufacturing unit which limited the supply
of certain drugs.
o The RCB SMALL CAP VALUE EQUITY FUND gained 15.2% during the 12
months ending September 30, 2009.The Fund outperformed both the
Russell 2000 Index return of -9.6% and the Lipper Small-Cap Value
Funds Classification return of -6.3%. Liberty Media Interactive, a
retailing company, was the largest contributor to the funds overall
performance.The stock contributed 6.2% to the Fund's performance and
was up 226% during the period.The company benefited from alleviated
liquidity fears in conjunction with better then expected QVC
results. Central Garden & Pet, a lawn care and pet supply company,
benefited from the return to normal weather conditions and lower
commodity prices which lifted the stock 79% and contributed 5% to
the Fund's overall return.Virgin Media, a UK-based entertainment and
communications company, was up 76% due to its strong balance sheet
and the declining US dollar. Liberty Media Capital, a media holding
company, was up 57% due to significant upside potential in its main
holding, Sirius XM. White Mountains Insurance Group, a property and
casualty insurer, detracted 34% during the period as a result of its
weakening reinsurance business in Japan which the company is looking
to sell. Exterran Holdings, the largest provider of natural gas
compression services in the United States, declined 26% as a result
of the prolonged decline in natural gas prices.
o The OPPORTUNISTIC VALUE FUND fell 6.8% during the 12 months ending
September 30, 2009.This performance significantly outperformed the
Russell 1000 Value at -10.6%, the S&P500/ Citigroup Value Index of
-11.4%, bested the Lipper Large Cap Value Funds Classification at
-7.9% and also outperformed the broad market as defined by the S&P
500, which declined 6.9%. During this "year of two markets", a
precipitous decline followed by a swift rally, the top contributors
to performance in the portfolio included Mylan, which increased 40%
throughout the fiscal year and Del Monte which increased 52%. The
top detractors to performance held throughout the year included
ConocoPhillips, down 36% and USBancorp, which was down 38%.
o The MULTI-ASSET FUND returned 3.5% during the year ending September
30, 2009.This compares favorably to the Lipper Flexible Portfolio
Funds Objective return of 1.0% for the same period.The Fund returns
were positively affected by an increasing exposure to the U.S.
equity market during the year. Investments made during the year in
international equities, global REITs and high yield bonds also
boosted Fund returns.As a result of investments made during the
year, the Fund ended the fiscal year with a reduced cash position.
(CONTINUES)
CNI CHARTER FUNDS | PAGE 5
investment adviser's report
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
As we look forward from here, most economists expect the economy to start
generating positive real economic growth in the final quarter of 2009 and on
into 2010. Consumer sentiment remains in question as job losses are expected to
continue rising into 2010, albeit at a slower pace. Balance sheets in certain
segments of the economy still need to be adjusted.The Dollar continues to
weaken, which should make U.S. goods more attractive for foreign purchasers.
Inflation, which appears muted given the recessionary environment, could become
an issue sooner rather than later. Short-term interest rates should remain low
as the Federal Reserve is not anticipated to raise rates until the economy is
clearly in recovery mode. Given all the facts above, the bottom line is that the
economic landscape is improving and investors continue to find that
encouraging.As always, we will continue to apply our disciplined investment
approach with the objective of providing superior investment results across the
various strategies we manage.
Sincerely,
/s/ Brian L. Garbe
- ------------------------------------
Brian L. Garbe
DIRECTOR OF RESEARCH AND TRADING
CITY NATIONAL ASSET MANAGEMENT,INC.
THIS MATERIAL REPRESENTS THE MANAGER'S ASSESSMENT OF THE PORTFOLIO AND MARKET
ENVIRONMENT AT A SPECIFIC POINT IN TIME AND SHOULD NOT BE RELIED UPON BY THE
READER AS RESEARCH OR INVESTMENT ADVICE.
CNI CHARTER FUNDS | PAGE 6
fund overview
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
LARGE CAP VALUE EQUITY FUND
The Fund seeks to provide capital appreciation and moderate income consistent
with current returns available in the marketplace by investing in large U.S.
corporations which are undervalued and whose market valuations compare favorably
relative to similar companies.
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the CNI Large Cap
Value Equity Fund, Institutional Class or Class N Shares, versus the S&P 500/
Citigroup Value Index, and the Lipper Large Cap Value Funds Classification
[LINE GRAPH]
Initial Investment Date 1/14/00 SEP 00 SEP 01 SEP 02 SEP 03 SEP 04 SEP 05 SEP 06 SEP 07 SEP 08 SEP 09
------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------
CNI Large Cap Value
Fund, Institutional $10,000 $10,099 $8,447 $6,852 $8,499 $10,148 $11,608 $13,291 $15,365 $12,051 $10,842
CNI Large Cap Value
Fund, Class N $10,000 $10,094 $8,410 $6,814 $8,433 $10,036 $11,455 $13,087 $15,081 $11,806 $10,593
S&P 500/Citigroup
Value Index $10,000 $ 9,871 $8,508 $6,989 $8,579 $10,271 $11,951 $13,796 $16,018 $12,093 $10,711
Lipper Large Cap
Value Funds
Classification $10,000 $10,417 $9,627 $7,920 $9,680 $11,333 $12,943 $14,543 $16,668 $12,748 $11,738
- ----------
(1) The performance in the above graph does not reflect the deduction of taxes
the shareholder will pay on Fund distributions or the redemptions of Fund
shares. Investment performance reflects fee waivers in effect. In the
absence of such waivers, total return would be reduced.
Past performance is no indication of future performance.
The Fund's comparative benchmarks do not include the annual operating expenses
incurred by the Fund. Please note that one cannot invest directly in an
unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS
Ticker 1-Year 3-Year 5-Year Inception
Shares Symbol Return Return Return to Date
- --------------------------------------------------------------------------------
Institutional Class (1)# CNLIX -10.03% -6.56% 1.33% 0.84%
- --------------------------------------------------------------------------------
Class N (2)+ CVEAX -10.27% -6.80% 1.09% 0.60%
- --------------------------------------------------------------------------------
- ----------
(1) Commenced operations on January 14, 2000.
(2) Commenced operations on April 13, 2000.
# The Fund's Institutional Class Shares are currently offered only to
accounts for which City National Bank serves as trustee or in a fiduciary
capacity.
+ Class N Shares' performance for the period prior to April 13, 2000
reflects the performance of the Fund's Institutional Class Shares.The
performance of the Institutional Class Shares has not been adjusted to
reflect the higher Rule 12b-1 Fees and expenses applicable to Class N
Shares. If it had, performance would have been lower than that shown.
Top Ten Holdings
% OF PORTFOLIO
JPMorgan Chase 4.0
AT&T 3.8
Wells Fargo 3.0
Verizon Communications 2.5
Goldman Sachs Group 2.3
Hewlett-Packard 1.9
Pfizer 1.9
Procter & Gamble 1.8
Wal-Mart Stores 1.7
Occidental Petroleum 1.7
CNI CHARTER FUNDS | PAGE 7
fund overview
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
LARGE CAP GROWTH EQUITY FUND
The Fund seeks to provide capital appreciation by investing in large U.S.
corporations and with the potential for growth and that possess superior
management, strong market position, consistent records of increased earnings and
a strong operating and financial position.
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the CNI Large Cap
Growth Equity Fund, Institutional Class or Class N Shares, versus the S&P 500/
Citigroup Growth Index, and the Lipper Large Cap Growth Funds Classification
(LINE GRAPH)
Initial Investment Date 1/14/00 SEP 00 SEP 01 SEP 02 SEP 03 SEP 04 SEP 05 SEP 06 SEP 07 SEP 08 SEP 09
------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------
CNI Large Cap Growth
Fund, Institutional $10,000 $9,370 $6,360 $5,250 $6,379 $6,774 $7,489 $7,833 $9,001 $7,525 $7,272
CNI Large Cap Growth
Fund, Class N $10,000 $9,350 $6,330 $5,210 $6,320 $6,691 $7,379 $7,714 $8,833 $7,371 $7,093
S&P 500/Citigroup
Growth Index $10,000 $9,764 $5,950 $4,538 $5,717 $6,202 $6,709 $7,138 $8,336 $6,715 $6,539
Lipper Large Cap
Growth Funds
Classification $10,000 $10,356 $6,316 $5,059 $6,122 $6,647 $7,551 $7,853 $9,500 $7,369 $7,169
- ----------
(1) The performance in the above graph does not reflect the deduction of taxes
the shareholder will pay on Fund distributions or the redemptions of Fund
shares. Investment performance reflects fee waivers in effect. In the
absence of such waivers, total return would be reduced.
Past performance is no indication of future performance.
The Fund's comparative benchmarks do not include the annual operating expenses
incurred by the Fund. Please note that one cannot invest directly in an
unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS
Ticker 1-Year 3-Year 5-Year Inception
Shares Symbol Return Return Return to Date
- --------------------------------------------------------------------------------
Institutional Class (1)# CNGIX -3.36% -2.45% 1.43% -3.23%
- --------------------------------------------------------------------------------
Class N (2)+ CLEAX -3.77% -2.76% 1.17% -3.47%
- --------------------------------------------------------------------------------
- ----------
(1) Commenced operations on January 14, 2000.
(2) Commenced operations on March 28, 2000.
# The Fund's Institutional Class Shares are currently offered only to
accounts for which City National Bank serves as trustee or in a fiduciary
capacity.
+ Class N Shares' performance for the period prior to March 28, 2000
reflects the performance of the Fund's Institutional Class Shares.The
performance of the Institutional Class Shares has not been adjusted to
reflect the higher Rule 12b-1 Fees and expenses applicable to Class N
Shares. If it had, performance would have been lower than that shown.
Top Ten Holdings
% OF PORTFOLIO
Exxon Mobil 5.9
Microsoft 4.3
Google, Cl A 3.5
Chevron 3.4
IBM 3.3
Qualcomm 3.1
Johnson & Johnson 2.7
Oracle 2.4
Wal-Mart Stores 2.4
Procter & Gamble 2.4
CNI CHARTER FUNDS | PAGE 8
fund overview
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
RCB SMALL CAP VALUE FUND
The Fund seeks to provide capital appreciation by investing primarily in smaller
U.S. corporations which are considered undervalued.
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the CNI RCB Small
Cap Value Fund, Institutional Class, Class N or Class R Shares, versus the
Russell 2500 Value Index, the Russell 2000 Index, the Russell 2000 Value Index,
the Lipper Small Cap Value Funds Classification, and the Lipper Small Cap Core
Funds Classification(1)
[LINE GRAPH]
Initial Investment Date 9/30/99 SEP 00 SEP 01 SEP 02 SEP 03 SEP 04 SEP 05 SEP 06 SEP 07 SEP 08 SEP 09
------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------
CNI RCB Small Cap Value
Fund, Synthetic
Institutional $10,000 $11,150 $12,166 $10,815 $15,742 $19,672 $21,613 $21,700 $24,012 $15,606 $17,978
CNI RCB Small Cap Value
Fund, Synthetic
Class N $10,000 $11,150 $12,166 $10,801 $15,685 $19,550 $21,416 $21,453 $23,678 $15,352 $17,641
CNI RCB Small Cap Value
Fund,
Class R $ 9,650 $10,759 $11,740 $10,409 $15,115 $18,838 $20,639 $20,669 $22,824 $14,832 $17,131
Russell 2500 Value
Index $10,000 $11,574 $11,866 $11,792 $15,477 $19,278 $23,387 $25,991 $28,274 $23,809 $21,826
Russell 2000
Index $10,000 $12,339 $ 9,722 $ 8,818 $12,036 $14,296 $16,862 $18,535 $20,823 $17,807 $16,107
Russell 2000 Value
Index $10,000 $11,536 $12,183 $12,004 $15,805 $19,861 $23,387 $26,663 $28,285 $24,820 $21,691
Lipper Small Cap Value
Funds
Classification $10,000 $11,761 $12,159 $12,015 $15,639 $19,412 $23,062 $25,073 $27,640 $23,080 $21,630
- ----------
(1) The performance in the above graph does not reflect the deduction of taxes
the shareholder will pay on Fund distributions or the redemptions of Fund
shares. Investment performance reflects fee waivers in effect. In the
absence of such waivers, total return would be reduced.
Past performance is no indication of future performance.
The Fund's comparative benchmarks do not include the annual operating expenses
incurred by the Fund. Please note that one cannot invest directly in an
unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS
Ticker 1-Year 3-Year 5-Year 10-Year Inception
Shares Symbol Return Return Return Return to Date
- -------------------------------------------------------------------------------------
Institutional Class (1)#+ RCBIX 15.20% -6.08% -1.78% 6.04% 9.52%
- -------------------------------------------------------------------------------------
Class N (1)+ RCBAX 14.91% -6.31% -2.03% 5.84% 9.33%
- -------------------------------------------------------------------------------------
Class R (2) RCBSX 15.50% -6.07% -1.88% 5.91% 9.39%
- -------------------------------------------------------------------------------------
Class R with load RCBSX 11.43% -7.17% -2.58% 5.53% 9.04%
- -------------------------------------------------------------------------------------
- ----------
(1) Commenced operations on October 3, 2001.
(2) Commenced operations on September 30, 1998.
# The Fund's Institutional Class Shares are currently offered only to
accounts for which City National Bank serves as trustee or in a fiduciary
capacity.
+ The performance of the Institutional Class and Class N Shares for the
period prior to October 3, 2001 reflect the performance of the Class R
Shares of a predecessor mutual fund.The performance of the predecessor
fund's Class R Shares has not been adjusted to reflect the expenses
applicable to Institutional and Class N Shares. Fees for the Institutional
Class Shares are lower than the fees for the predecessor fund's Class R
Shares; correspondingly, Institutional Class performance would have been
higher than that shown.
Top Ten Holdings*
% OF PORTFOLIO
White Mountains Insurance Group 5.3
Liberty Media - Interactive, Ser A 4.4
Washington Post, Cl B 4.4
Liberty Media - Capital, Ser A 4.3
Alleghany 4.3
Nalco Holding 4.2
Actuant, Cl A 4.2
Central Garden & Pet, Cl A 4.2
Chimera Investment 4.1
Wendy's/Arby's Group, Cl A 4.1
- ----------
* Excludes Cash Equivalents
CNI CHARTER FUNDS | PAGE 9
fund overview
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
OPPORTUNISTIC VALUE FUND
The Fund seeks to achieve long-term capital appreciation by investing in a
diversified portfolio of equity securities which are undervalued.
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the CNI
Opportunistic Value Fund, Institutional Class, Class E, or Class N Shares,
versus the Russell 1000 Value Index, the S&P 500 Index, and the Lipper Multi-Cap
Value Funds Classification(1)
(LINE GRAPH)
Initial Investment Date 3/31/04 SEP 04 SEP 05 SEP 06 SEP 07 SEP 08 SEP 09
------- ------- ------ ------- ------- ------- -------
CNI Opportunistic Value Fund, Institutional $10,000 $10,000 $11,873 $12,879 $14,382 $11,860 $11,052
CNI Opportunistic Value Fund, Class E $10,000 $10,026 $11,933 $12,964 $14,523 $11,985 $11,078
CNI Opportunistic Value Fund, Class N $10,000 $ 9,987 $11,841 $12,799 $14,262 $11,740 $10,905
Russell 1000 Value Index $10,000 $10,244 $11,953 $13,701 $15,680 $11,986 $10,714
S&P 500 Index $10,000 $ 9,982 $11,205 $12,414 $14,454 $11,278 $10,499
Lipper Multi-Cap Value Funds Classification $10,000 $10,071 $11,661 $12,944 $14,717 $11,070 $10,527
- ----------
(1) The performance in the above graph does not reflect the deduction of taxes
the shareholder will pay on Fund distributions or the redemptions of Fund
shares. Investment performance reflects fee waivers in effect. In the
absence of such waivers, total return would be reduced.
Past performance is no indication of future performance.
The Fund's comparative benchmarks do not include the annual operating expenses
incurred by the Fund. Please note that one cannot invest directly in an
unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS
Ticker 1-Year 3-Year 5-Year Inception
Shares Symbol Return Return Return to Date
- -----------------------------------------------------------------------------
Institutional Class (1)#+ OPVIX -6.81% -4.97% 2.02% 1.84%
- -----------------------------------------------------------------------------
Class E (1)+ OPVEX -7.57% -5.11% 2.02% 1.88%
- -----------------------------------------------------------------------------
Class N (1)+ OPVNX -7.12% -5.20% 1.77% 1.59%
- -----------------------------------------------------------------------------
- ----------
(1) Commenced operations on June 26, 2008.
# The Fund's Institutional Class Shares are currently offered only to
accounts for which City National Bank serves as trustee or in a fiduciary
capacity.
+ For periods prior to June 26, 2008 the performance data quoted above
represents past performance of an institutional account that converted
into Class N shares of the Fund (the "Predecessor Account"), adjusted to
reflect fees and expenses borne by the Fund.The Predecessor Account was
not a registered mutual fund so it was not subject to the same investment
and tax restrictions as the Fund. If it had been, the Predecessor
Account's performance may have been lower.
Top Ten Holdings*
% OF PORTFOLIO
Tyco International 3.4
US Bancorp 3.4
HCC Insurance Holdings 3.4
Symantec 3.1
Brookfield Asset Management, CL A 3.0
Unit 3.0
Covidien 2.9
Quest Diagnostics 2.9
Del Monte Foods 2.9
Chubb 2.7
- ----------
* Excludes Cash Equivalents
CNI CHARTER FUNDS | PAGE 10
fund overview
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
MULTI-ASSET FUND
The Fund seeks to generate a positive total return in excess of inflation in a
manner consistent with capital preservation in all market environments.
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the CNI Multi-Asset
Fund, Institutional Class or Class N Shares, versus the Barclays U.S. TIPS
Index; a 60/40 hybrid of the S&P 500 Index and the Barclays Intermediate U.S.
Government/Credit Index; and a CPI +500 Basis Points benchmark; and the Lipper
Flexible Portfolio Funds Classification.
(LINE GRAPH)
Initial Investment Date 10/1/07 SEP 08 SEP 09
------- ------- -------
CNI Multi-Asset Fund, Institutional $10,000 $ 9,016 $ 9,335
CNI Multi-Asset Fund, Class N $10,000 $ 8,988 $ 9,284
60/40 Hybrid of the following two indexes: $10,000 $ 8,685 $ 8,727
S&P 500 Index $10,000 $ 7,700 $ 7,168
Barclays Intermediate US Government/Credit Index $10,000 $10,314 $11,346
Barclays US TIPS Index $10,000 $10,620 $11,221
CPI + Annualized 500 basis points $10,000 $11,016 $11,419
Lipper Flexible Portfolio Funds Classification $10,000 $ 8,747 $ 9,009
- ----------
(1) The performance in the above graph does not reflect the deduction of taxes
the shareholder will pay on Fund distributions or the redemptions of Fund
shares. Investment performance reflects fee waivers in effect. In the
absence of such waivers, total return would be reduced.
Past performance is no indication of future performance.
The Fund's comparative benchmarks do not include the annual operating expenses
incurred by the Fund. Please note that one cannot invest directly in an
unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS
Annualized
Ticker 1-Year Inception
Shares Symbol Return to Date
- ---------------------------------------------------------------------------
Institutional Class (1)# CNLIX 3.54% -3.39%
- ---------------------------------------------------------------------------
Class N (1) CVEAX 3.29% -3.65%
- ---------------------------------------------------------------------------
- ----------
(1) Commenced operations on October 1, 2007.
# The Fund's Institutional Class Shares are currently offered only to
accounts for which City National Bank serves as trustee or in a fiduciary
capacity.
Top Ten Holdings*
% OF PORTFOLIO
SPDR S&P 500 Fund 27.4
iShares Barclays 1-3 Year
Credit Bond Fund 8.6
CNI Corporate Bond Fund,
Institutional Class 8.5
CNI Government Bond Fund,
Institutional Class 6.7
Vanguard Emerging Markets 5.6
iShares MSCI EAFE Index Fund 5.2
iShares S&P MidCap 400 Index
Fund 4.9
Cohen & Steers International
Realty Fund, Inc. 4.3
Alpine International Real Estate
Equity Fund 3.6
FHLB 0.500%, 11/05/09 3.0
- ----------
* Excludes Cash Equivalents
CNI CHARTER FUNDS | PAGE 11
investment adviser's report
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
FIXED INCOME FUNDS
As the Funds' fiscal year ended, bond investors were weighing a number of
seemingly contradictory signs. On one hand, there are historically low yields in
short-term U.S.Treasuries due to a weak economy and accommodative monetary
policy. Yet, paradoxically, prices of riskier securities such as
investment-grade corporate bonds and high-yield debt skyrocketed in the first
nine months of 2009 (up 17% and 50%, respectively). Meanwhile,Treasuries are
down -2.3% for the same period.
The outsized returns of lower grade bonds would not be unusual in a pronounced
economic recovery, but they are surprising given today's tentative economic
fundamentals and constricted lending standards. It's a bit unnerving to realize
that corporate yields spreads over Treasuries are narrower than they were in the
spring of 2008 as the financial meltdown began with the collapse of Bear
Stearns.
As of this writing, municipal bond investors also face conflicting signals. Most
cities, counties and states are experiencing the worst budgetary crises of a
generation as tax receipts continue to decline due to sharp revenue shortfalls.
However, absolute and relative yields (municipal yields versus yields on
Treasuries) are at or below historic lows, signaling a significantly more
bullish environment ahead. Leaving fundamentals aside for the moment, demand for
tax-exempt bonds has far outstripped supply, pushing the absolute yield levels
for municipal bonds past 40-year lows. It appears that technical market
conditions are outweighing credit fundamentals once again.We expect municipals
to return to their longer trend valuations by giving back some of the
over-appreciation.
The budget woes of California and other states may have disappeared from the
front pages, but California's financial problems have not gone away. Politicians
have simply postponed the structural budget issues while revenue shortfalls
continue to mount. It's important to note, however, that debt servicing of
California's General Obligation debt ranks second in priority payments and, in
our view, remains a generally suitable investment -- even with BBB average
ratings and changing valuations.
During the fiscal year, City National Asset Management, Inc. focused on two main
themes -- keeping a close eye on risk management and increasing our credit
exposure.As the credit crisis thawed in early 2009, we reduced our exposure to
treasury/government related securities in favor of higher quality corporate or
municipal bonds. Risks remain in the economy so we did not materially increase
our exposure to lower investment grade issues (BBB) in our California or
Corporate Bond Funds.This stance, while keeping with the objectives of those
funds, captured most of the strong returns witnessed in the bond market this
year. With the Fed on hold for the foreseeable future, we will keep our maturity
positioning near current levels.
BOND FUND PERFORMANCE
(ALL RETURNS LISTED FOR CNI CHARTER FUNDS REFER TO INSTITUTIONAL CLASS SHARES)
o The CORPORATE BOND FUND produced a total return of 12.5% for the last
12 months. For the same period, the Barclays Intermediate U.S.
Corporate Index returned 19.2%.The Corporate Bond Fund maintained a
cautious stance in the face of elevated unemployment and uncertain
economic conditions. Our underweight in lower quality (BBB) issues led
to a lower than benchmark return. However, opportunistic trades in
finance issuers resulted in stronger performance versus peer funds;
where the Lipper Short Intermediate Investment Grade Objective was up
10.3%.
o The GOVERNMENT BOND FUND produced a total return 5.2% for the last 12
months. For the same period, the Barclays Intermediate U.S. Government
Bond Index returned 6.3%.The fund trailed the benchmark due to our
underweight in maturity and agency Mortgage Backed Securities.We
maintain our slightly shorter maturity stance versus the benchmarks in
CNI CHARTER FUNDS | PAGE 12
- --------------------------------------------------------------------------------
order to keep liquidity higher than normal for our shareholder
activities.The fund also trailed its peer group during this period as
evidenced by the Lipper Short Intermediate U.S. Government Objective
return of 6.5%.
o The CALIFORNIA TAX EXEMPT BOND FUND produced a total return of 8.5%
for the last 12 months. For the same period, the Barclays CA
Intermediate-Short Municipal Index returned 9.1%.The past fiscal year
returns were above historical averages as municipals migrated back to
the norm after the credit crisis.Absolute performance was strong --but
lagged behind the Barclay's index primarily because the Fund had a far
smaller concentrated position in California State General Obligation
issues.The Fund fared better against its peer group where the Lipper
CA Short/Intermediate Municipal Debt Objective returned 7.0% because
it had less exposure to lower quality issues by design due to this
uncertain economic time.
o The HIGH YIELD BOND FUND produced a total return of 12.9% for the last
12 months. For the same period, the Citigroup High-Yield Market Index
returned 21.0%.The Fund's focus on BB rated issuers over CCC or
defaulted issues resulted in lower returns than the benchmark, as
increased risk appetite was handsomely rewarded during this period.The
Fund's relative performance vis-a-vis its peer group remained
competitive where the Lipper High Current Yield Bond Funds Objective
returned 13.1%.
STRATEGIC OUTLOOK FOR BOND FUNDS
The dominant theme through September 2009 was that investors significantly
increased their appetite for risk which drove up bond valuations most for lower
quality issues.This can easily reverse itself if the economy takes another
dip.Therefore, risk management remains paramount as we examine corporate bond
valuations in a choppy economy and credit environment. For our Corporate Bond
Fund, we have reduced our overweight in financial corporate bonds by moving some
of our exposure to shorter maturity issues and taking other measures that should
enable us to protect corporate valuations if credit spreads erode.
In our California Tax Exempt Bond Fund, we are moving to increase yield by
selectively adding cushion callable bonds (bonds that have an attractive yield
to either the call or maturity, along with a higher coupon to protect against
extension risk).We are also keeping a tight band on the call/maturity range to
better control interest rate risk in the future.
We are keeping a close eye on the economy and indicators like consumer spending
and employment. Once the economic expansion gains better traction, we will look
to incorporate TIPs and international securities where appropriate to hedge
against the risk of rising rates and currency devaluations.
Sincerely,
/s/ Rodney J. Olea
- -------------------------------------
Rodney J. Olea
DIRECTOR OF FIXED INCOME
CITY NATIONAL ASSET MANAGEMENT, INC.
THIS MATERIAL REPRESENTS THE MANAGER'S ASSESSMENT OF THE PORTFOLIO AND MARKET
ENVIRONMENT AT A SPECIFIC POINT IN TIME AND SHOULD NOT BE RELIED UPON BY THE
READER AS RESEARCH OR INVESTMENT ADVICE.
CNI CHARTER FUNDS | PAGE 13
fund overview
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CORPORATE BOND FUND
The Fund seeks to provide current income (as the primary component of a total
return, intermediate duration strategy) by investing in a diversified portfolio
of investment grade fixed income securities, primarily corporate bonds issued by
domestic and international companies denominated in U.S. dollars.
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the CNI Corporate
Bond Fund, Institutional Class or Class N Shares, versus the Barclays
Intermediate U.S. Corporate Index, and the Lipper Short/Intermediate Investment
Grade Debt Objective(1)
(LINE GRAPH)
Initial Investment
Date 1/14/00 SEP 00 SEP 01 SEP 02 SEP 03 SEP 04 SEP 05 SEP 06 SEP 07 SEP 08 SEP 09
------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------
CNI Corporate Bond
Fund, Institutional $10,000 $10,576 $11,860 $12,578 $13,425 $13,714 $13,887 $14,330 $14,984 $14,990 $16,861
CNI Corporate Bond
Fund, Class N $10,000 $10,593 $11,872 $12,548 $13,359 $13,625 $13,749 $14,151 $14,760 $14,744 $16,541
Barclays Intermediate
US Corporate Index $10,000 $10,645 $11,993 $12,853 $14,130 $14,687 $14,944 $15,478 $16,161 $15,311 $18,250
Lipper Short/Inter-
mediate Investment
Grade Debt Objective $10,000 $10,561 $11,727 $12,372 $12,980 $13,253 $13,432 $13,855 $14,452 $14,361 $15,843
- ----------
(1) The performance in the above graph does not reflect the deduction of taxes
the shareholder will pay on Fund distributions or the redemptions of Fund
shares. Investment performance reflects fee waivers in effect. In the
absence of such waivers, total return would be reduced.
Past performance is no indication of future performance.
The Fund's comparative benchmarks do not include the annual operating expenses
incurred by the Fund. Please note that one cannot invest directly in an
unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS
Ticker 1-Year 3-Year 5-Year Inception
Shares Symbol Return Return Return to Date
- --------------------------------------------------------------------------------------
Institutional Class (1)# CNCIX 12.48% 5.57% 4.22% 5.53%
- --------------------------------------------------------------------------------------
Class N (2)+ CCBAX 12.19% 5.34% 3.96% 5.32%
- --------------------------------------------------------------------------------------
- ----------
(1) Commenced operations on January 14, 2000.
(2) Commenced operations on April 13, 2000.
# The Fund's Institutional Class Shares are currently offered only to
accounts for which City National Bank serves as trustee or in a fiduciary
capacity.
+ Class N Shares' performance for the period prior to April 13, 2000 reflects
the performance of the Fund's Institutional Class Shares.The performance of
the Institutional Class Shares has not been adjusted to reflect the higher
Rule 12b-1 fees and expenses applicable to Class N Shares. If it had,
performance would have been lower than that shown.
Top Ten Holdings*
% OF PORTFOLIO
General Electric Capital,
FDIC Insured
2.200%, 06/08/12 3.2
Citigroup Funding
2.250%, 12/10/12 2.8
JPMorgan Chase
2.125%, 12/26/12 2.8
GMAC
2.200%, 12/19/12 2.8
General Electric Capital
6.000%, 06/15/12 2.6
Wyeth
6.950%, 03/15/11 2.6
Wells Fargo, FDIC Insured
3.000%, 12/09/11 2.5
Microsoft
4.200%, 06/01/19 2.3
Merrill Lynch
6.050%, 05/16/16 2.3
International Business Machines
7.625%, 10/15/18 2.1
- ----------
* Excludes Cash Equivalents
CNI CHARTER FUNDS | PAGE 14
fund overview
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
GOVERNMENT BOND FUND
The Fund seeks to provide current income (as the primary component of a total
return, intermediate duration strategy) by investing primarily in U.S.
government securities either issued or guaranteed by the U.S. government or its
agencies or instrumentalities.
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the CNI Government
Bond Fund, Institutional Class or Class N Shares, versus the Barclays
Intermediate U.S. Government Bond Index, and the Lipper Short/Intermediate U.S.
Government Objective(1)
(LINE GRAPH)
Initial Investment
Date 1/14/00 SEP 00 SEP 01 SEP 02 SEP 03 SEP 04 SEP 05 SEP 06 SEP 07 SEP 08 SEP 09
------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------
CNI Government Bond
Fund, Institutional $10,000 $10,564 $11,796 $12,685 $13,025 $13,130 $13,317 $13,702 $14,392 $15,093 $15,875
CNI Government Bond
Fund, Class N $10,000 $10,534 $11,720 $12,596 $12,937 $13,008 $13,159 $13,505 $14,149 $14,799 $15,525
Barclays Intermediate
US Government Bond
Index $10,000 $10,659 $12,031 $13,046 $13,501 $13,758 $13,938 $14,431 $15,279 $16,428 $17,456
Lipper Short/Inter
mediate US Government
Bond Objective $10,000 $10,535 $11,679 $12,446 $12,759 $12,900 $13,016 $13,424 $14,034 $14,720 $15,677
- ----------
(1) The performance in the above graph does not reflect the deduction of taxes
the shareholder will pay on Fund distributions or the redemptions of Fund
shares. Investment performance reflects fee waivers in effect. In the
absence of such waivers, total return would be reduced.
Past performance is no indication of future performance.
The Fund's comparative benchmarks do not include the annual operating expenses
incurred by the Fund. Please note that one cannot invest directly in an
unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS
Ticker 1-Year 3-Year 5-Year Inception
Shares Symbol Return Return Return to Date
- --------------------------------------------------------------------------------------
Institutional Class (1)# CNBIX 5.18% 5.03% 3.87% 4.87%
- --------------------------------------------------------------------------------------
Class N (2)+ CGBAX 4.91% 4.76% 3.60% 4.63%
- --------------------------------------------------------------------------------------
- ----------
(1) Commenced operations on January 14, 2000.
(2) Commenced operations on April 13, 2000.
# The Fund's Institutional Class Shares are currently offered only to
accounts for which City National Bank serves as trustee or in a fiduciary
capacity.
+ Class N Shares' performance for the period prior to April 13, 2000 reflects
the performance of the Fund's Institutional Class Shares.The performance of
the Institutional Class Shares has not been adjusted to reflect the higher
Rule 12b-1 Fees and expenses applicable to Class N Shares. If it had,
performance would have been lower than that shown.
Top Ten Holdings*
% OF PORTFOLIO
FHLB
2.250%, 04/13/12 9.5
FHLB
3.625%, 10/18/13 8.4
FNMA
3.000%, 07/28/14 8.1
FHLMC
2.000%, 12/22/11 8.0
FNMA
2.900%, 04/07/14 7.6
FNMA
6.250%, 02/01/11 7.1
FNMA, Ser 2005-25, Cl VH
5.000%, 04/25/16 6.2
FHLB
5.250%, 06/18/14 6.0
FHLMC REMIC, Ser R016, Cl AM
5.125%, 06/15/18 4.7
FHLMC REMIC, Ser R010, Cl AB
5.500%, 12/15/19 4.5
- ------------------
* Excludes Cash Equivalents
CNI CHARTER FUNDS | PAGE 15
fund overview
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT BOND FUND
The Fund seeks to provide current income exempt from Federal and California
state income tax (as the primary component of a total return strategy) by
investing primarily in investment grade California municipal bonds and notes.
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the CNI California
Tax Exempt Bond Fund, Institutional Class or Class N Shares, versus the Barclays
CA Intermediate-Short Municipal Index, and the Lipper CA Short/Intermediate
Municipal Debt Objective(1)
(LINE GRAPH)
Initial Investment
Date 1/14/00 SEP 00 SEP 01 SEP 02 SEP 03 SEP 04 SEP 05 SEP 06 SEP 07 SEP 08 SEP 09
------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------
CNI California
Tax-Exempt Bond
Fund, Institutional $10,000 $10,543 $11,303 $12,160 $12,480 $12,730 $12,940 $13,351 $13,749 $13,938 $15,116
CNI California
Tax-Exempt Bond
Fund, Class N $10,000 $10,532 $11,277 $12,112 $12,399 $12,627 $12,803 $13,163 $13,534 $13,685 $14,800
Barclays CA Inter
mediate-Short
Municipal Index $10,000 $10,545 $11,403 $12,272 $12,633 $13,000 $13,250 $13,677 $14,185 $14,690 $16,020
Lipper CA Short/Inter
mediate Municipal
Objective $10,000 $10,449 $11,132 $11,810 $12,051 $12,253 $12,667 $13,070 $13,406 $13,424 $14,359
- ----------
(1) The performance in the above graph does not reflect the deduction of taxes
the shareholder will pay on Fund distributions or the redemptions of Fund
shares. Investment performance reflects fee waivers in effect. In the
absence of such waivers, total return would be reduced.
Past performance is no indication of future performance.
The Fund's comparative benchmarks do not include the annual operating expenses
incurred by the Fund. Please note that one cannot invest directly in an
unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS
Ticker 1-Year 3-Year 5-Year Inception
Shares Symbol Return Return Return to Date
- --------------------------------------------------------------------------------------
Institutional Class (1)# CNTIX 8.45% 4.22% 3.50% 4.35%
- --------------------------------------------------------------------------------------
Class N (2)+ CCTEX 8.15% 3.99% 3.23% 4.12%
- ----------
(1) Commenced operations on January 14, 2000.
(2) Commenced operations on April 13, 2000.
# The Fund's Institutional Class Shares are currently offered only to
accounts for which City National Bank serves as trustee or in a
fiduciary capacity.
+ Class N Shares' performance for the period prior to April 13, 2000
reflects the performance of the Fund's Institutional Class Shares.The
performance of the Institutional Class Shares has not been adjusted to
reflect the higher Rule 12b-1 Fees and expenses applicable to Class N
Shares. If it had, performance would have been lower than that shown.
Top Ten Holdings*
% OF PORTFOLIO
Golden State, Tobacco
Settlement, Ser B, RB
Pre-Refunded @ 100
5.500%, 06/01/13 2.8
Orange County, Public Financing
Authority, RB, NATL-RE
5.000%, 07/01/17 2.7
Golden State, Tobacco
Settlement, Ser A-1, RB
Pre-Refunded @ 100
6.750%, 06/01/13 2.5
San Francisco (City & County),
Public Utilities Commission,
Ser B, RB
5.000%, 11/01/19 2.2
Los Angeles, Wastewater Systems
Authority, Ser A, RB
5.000%, 06/01/14 2.1
Gilroy, Unified School District,
GO, NATL-RE FGIC
Callable 08/01/13 @ 100
5.250%, 08/01/19 2.1
Sacramento, Municipal Utility
District Ser T, RB, NATL-RE FGIC
Callable 05/15/14 @ 100
5.250%, 5/15/22 2.1
San Diego, Public Facilities
Financing Authority Ser B, RB
5.000%, 05/15/14 2.1
California State, Department of
Water Resources Power Supply
Project, Ser H, RB, FSA
Callable 05/01/18 @ 100
5.000%, 05/01/21 2.1
Arizona State, School Facilities
Board, Ser C, COP, FSA
Callable 09/01/14 @ 100
5.000%, 09/01/15 2.1
- ----------
* Excluding Cash Equivalents
CNI CHARTER FUNDS | PAGE 16
fund overview
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
HIGH YIELD BOND FUND
The Fund seeks to maximize total return by investing primarily in fixed income
securities rated below investment grade including corporate bonds and
debentures, convertible and preferred securities, and zero coupon
obligations. The Fund may also invest in fixed income securities rated below
investment grade issued by governments and agencies, both U.S. and foreign, and
in equity securities. The Fund seeks to invest in securities that offer a high
current yield as well as total return potential and diversifies across issuers,
industries and sectors to control risks.
- --------------------------------------------------------------------------------
Comparison of Change in the Value of a $10,000 Investment in the CNI High Yield
Bond Fund, Institutional Class or Class N Shares, versus the Citigroup High
Yield Market Capped Index and the Lipper High Current Yield Bond Funds
Objective(1)
(LINE GRAPH)
Initial Investment
Date 1/14/00 SEP 00 SEP 01 SEP 02 SEP 03 SEP 04 SEP 05 SEP 06 SEP 07 SEP 08 SEP 09
------- ------- ------- ------- ------- ------- ------- ------- ------- ------- -------
CNI High Yield
Bond Fund,
Institutional $10,000 $10,421 $10,165 $10,654 $12,757 $14,349 $15,044 $16,082 $17,251 $15,556 $17,569
CNI High Yield
Bond Fund, Class N $10,000 $10,394 $10,109 $10,563 $12,611 $14,142 $14,784 $15,756 $16,852 $15,150 $17,060
Citigroup High
Yield Market Capped
Index $10,000 $ 9,973 $ 9,372 $ 9,458 $12,390 $13,914 $14,792 $15,793 $16,985 $15,533 $17,685
Citigroup High
Yield Market Index $10,000 $ 9,973 $ 9,372 $ 9,058 $12,072 $13,588 $14,470 $15,569 $16,761 $14,807 $17,922
Lipper High Current
Yield Objective $10,000 $ 9,921 $ 9,114 $ 8,945 $11,282 $12,571 $13,380 $14,301 $15,360 $13,758 $15,562
- ----------
(1) The performance in the above graph does not reflect the deduction of taxes
the shareholder will pay on Fund distributions or the redemptions of Fund
shares. Investment performance reflects fee waivers in effect. In the
absence of such waivers, total return would be reduced.
Past performance is no indication of future performance.
The Fund's comparative benchmarks do not include the annual operating expenses
incurred by the Fund. Please note that one cannot invest directly in an
unmanaged index.
AVERAGE ANNUAL TOTAL RETURNS
Ticker 1-Year 3-Year 5-Year Inception
Shares Symbol Return Return Return to Date
- --------------------------------------------------------------------------------------
Institutional Class (1)# CHYIX 12.94% 2.99% 4.13% 5.97%
- --------------------------------------------------------------------------------------
Class N (1) CHBAX 12.61% 2.69% 3.82% 5.65%
- --------------------------------------------------------------------------------------
- ----------
(1) Commenced operations on January 14, 2000.
# The Fund's Institutional Class Shares are currently offered only to
accounts for which City National Bank serves as trustee or in a fiduciary
capacity.
Top Ten Holdings
% OF PORTFOLIO
Torchmark
9.250%, 06/15/19 1.7
Stone Energy
8.250%, 12/15/11 1.4
McMoRan Exploration
11.875%, 11/15/14 1.1
Nuveen Investments
10.500%, 11/15/15 1.1
Douglas Dynamics
7.750%, 01/15/12 1.1
First Data
9.875%, 09/24/15 1.0
VWR Funding
10.250%, 07/15/15 1.0
GMAC
6.750%, 12/01/14 1.0
MetroPCS Wireless
9.250%, 11/01/14 1.0
Energy Future Holdings
10.875%, 11/01/17 1.0
CNI CHARTER FUNDS | PAGE 17
investment adviser's report
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
MONEY MARKET FUNDS
In last year's annual report, we reported on the massive flight to quality by
investors after a complete seizing of the liquidity and credit markets. Credit
conditions deteriorated dramatically after the bankruptcy of Lehman Brothers on
September 15, 2008.This deterioration played a major role in underscoring the
risks (either absolute or perceived) for all debt instruments.This includes the
risks inherent in commercial paper instruments, which are short-term financing
instruments used by corporations and purchased by many money market mutual
funds.
During the fourth quarter of 2008, the Federal Reserve Bank ("Fed") introduced
three new lending facilities in order to address the deteriorating credit
conditions and illiquidity in the financial markets. Specifically, the (1) Asset
Backed Commercial Paper & Money Market Mutual Fund Liquidity Facility; (2)
Commercial Paper Funding Facility; and (3) Money Market Investor Funding
Facility dramatically assisted in un-seizing the commercial paper markets.
In addition to the Fed, the Treasury took unprecedented steps this past year to
avert further negative effects from the credit and liquidity crises. One key
step created to support ongoing stability in money market mutual funds was the
Treasury's Temporary Guarantee Program for Money Market Funds. This expired in
September 2009.
With all this as a brief backdrop to what is considered by most as the worst
financial crisis since the Great Depression, most effects of the liquidity
crisis of the past two years are over. Short-term instruments like commercial
paper are no longer a major concern -- and most of today's focus for money
market funds is on rates.
As of this writing, the effective fed funds target rate is at 0 to 0.25% --
where it has remained since late 2008.The Fed lowered its target rate a few
times from last year's 2% level in order to lower borrowing costs for banks,
corporations and eventually consumers. Since most money market instrument yields
are based on the Fed Funds rate, this put downward pressure on the yields for
the underlying securities found in money market funds. In fact, according to
iMoney, 23% of all Money Market Funds were yielding 0% as of September 30,
2009.This had a negative effect on money market fund balances, which are down
15% year-to-date as investors move money into other asset classes or banking
instruments.
FUND COMMENTARY
o The PRIME MONEY MARKET FUND continued to emphasize high quality liquid
issuers as a way to garner yield while keeping an emphasis on risk
management.With our strategy focusing primarily on the highest quality
and liquid issuers, the Fund fared very well during this period.We've
also managed the average life of the Fund to around 40 days in order
to maintain higher yielding holdings in this very low interest rate
environment. Until we get evidence of sustained economic growth, we
will maintain the Fund's 40-50 day average life.
o The GOVERNMENT MONEY MARKET FUND was positioned well for changes in
Fed policy and the lower economic growth environment.We have
maintained the maturity profile to over 45 days average life in the
Fund in order to benefit from higher yielding holdings in the face of
continued low interest rates for the coming quarters.
o Our objective for the CALIFORNIA TAX EXEMPT MONEY MARKET FUND
continues to focus on the fundamental objective of safety and
liquidity.We have maintained a 30 day average life in the fund by
emphasizing high quality short-term assets. Additionally, we continue
to watch the state of California very closely as the economic crisis
continues to put pressure on the state and local issuers.We have not
owned direct issues of California General Obligations due to the
uncertainty in their ratings and budgetary imbalances.The size of the
state and the diverse
CNI CHARTER FUNDS | PAGE 18
nature of its economic makeup should help to weather the poor economic
conditions, and we remain confident in our risk management and
security selection.We will look to maintain the average days to
maturity while participating in new issue opportunities and yields.
STRATEGIC OUTLOOK
Our outlook remains favorable for the credit and liquidity environments for
money market instruments. The measures taken by the Fed and Treasury restored
the market and investor confidence relatively quickly, and most of those
measures are no longer in place since the markets have been normalized for quite
some time. However, due to pressure on growth for the U.S. economy and high
unemployment expected for most of 2010, the Fed will most likely keep interest
rates at exceptionally low levels which will affect interest rates for all money
market mutual funds. Our Money Market Funds are positioned well for a low rate
environment and slow economic growth in coming quarters.We remained focused, as
always, on safety and liquidity as we have position ourselves for continued
economic uncertainty and the eventual rise in interest rates. We will attempt to
keep around a 40-50 day average life in our funds in order to maintain an
optimal yield until we see signs of sustained rebound to the economy and
employment. As always, City National Asset Management, Inc. continues to monitor
the objectives of the Funds very closely and seek opportunities in the markets
to best serve our shareholders.
Sincerely,
/s/ Rodney J. Olea
- -----------------------------------------
Rodney J. Olea
DIRECTOR OF FIXED INCOME
CITY NATIONAL ASSET MANAGEMENT, INC.
THE ABOVE COMMENTARY EXPRESSES THE PORTFOLIO MANAGERS' VIEWS AS OF THE DATE
SHOWN AND SHOULD NOT BE RELIED UPON BY THE READER AS RESEARCH OR ADVICE
REGARDING ANY INVESTMENT. THESE VIEWS AND THE PORTFOLIO HOLDINGS ARE SUBJECT TO
CHANGE. THERE IS NO GUARANTEE THAT ANY FORECASTS MADE WILL COME TO PASS.
CNI CHARTER FUNDS | PAGE 19
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
LARGE CAP VALUE EQUITY FUND
(BAR CHART)
SECTOR WEIGHTINGS (UNAUDITED)*:
Financials 25.1%
Healthcare 12.1%
Industrials 11.9%
Consumer Staples 11.0%
Consumer Discretionary 10.0%
Utilities 7.5%
Information Technology 6.9%
Telecommunication Services 6.3%
Materials 4.4%
Energy 3.1%
Short-Term Investments 1.7%
- ----------
* Percentages based on total investments.
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
COMMON STOCK [98.3%]
AEROSPACE & DEFENSE [3.7%]
General Dynamics 9,000 $ 581
Goodrich 16,400 891
Lockheed Martin 4,400 344
Northrop Grumman 14,500 750
Raytheon 17,400 835
- ------------------------------------------------------------------------
TOTAL AEROSPACE & DEFENSE 3,401
========================================================================
AIR FREIGHT & LOGISTICS [0.8%]
FedEx 9,600 722
========================================================================
BEVERAGES [3.6%]
Coca-Cola 24,700 1,326
Coca-Cola Enterprises 25,200 540
Molson Coors Brewing, Cl B 15,400 750
Pepsi Bottling Group 17,300 630
- ------------------------------------------------------------------------
TOTAL BEVERAGES 3,246
========================================================================
BIOTECHNOLOGY [1.6%]
Amgen* 9,000 542
Genzyme - General Division* 10,000 567
Gilead Sciences* 7,000 326
- ------------------------------------------------------------------------
TOTAL BIOTECHNOLOGY 1,435
========================================================================
CAPITAL MARKETS [5.9%]
Bank of New York Mellon 36,900 1,070
Charles Schwab 17,000 325
Goldman Sachs Group 11,200 2,065
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
Morgan Stanley 35,700 $ 1,102
State Street 15,000 789
- ------------------------------------------------------------------------
TOTAL CAPITAL MARKETS 5,351
========================================================================
CHEMICALS [3.0%]
Dow Chemical 36,000 939
EI Du Pont de Nemours 28,500 916
PPG Industries 14,000 815
- ------------------------------------------------------------------------
TOTAL CHEMICALS 2,670
========================================================================
COMMERCIAL BANKS [5.2%]
BB&T 21,100 575
PNC Financial Services Group 7,300 355
US Bancorp 49,000 1,071
Wells Fargo 94,960 2,676
- ------------------------------------------------------------------------
TOTAL COMMERCIAL BANKS 4,677
========================================================================
COMPUTERS & PERIPHERALS [3.7%]
EMC* 12,000 205
Hewlett-Packard 36,600 1,728
IBM 11,600 1,387
- ------------------------------------------------------------------------
TOTAL COMPUTERS & PERIPHERALS 3,320
========================================================================
CONSTRUCTION & ENGINEERING [0.6%]
Fluor 10,100 513
========================================================================
CONTAINERS & PACKAGING [0.7%]
Ball 13,200 649
========================================================================
DIVERSIFIED FINANCIAL SERVICES [5.2%]
Bank of America 48,000 812
JPMorgan Chase 83,200 3,646
Nasdaq OMX Group* 12,000 253
- ------------------------------------------------------------------------
TOTAL DIVERSIFIED FINANCIAL SERVICES 4,711
========================================================================
DIVERSIFIED TELECOMMUNICATION SERVICES [6.2%]
AT&T 126,617 3,420
Verizon Communications 73,509 2,225
- ------------------------------------------------------------------------
TOTAL DIVERSIFIED
TELECOMMUNICATION SERVICES 5,645
========================================================================
ELECTRIC UTILITIES [4.5%]
Allegheny Energy 14,000 371
American Electric Power 13,000 403
SEE ACCOMPANYING NOTES TO FINANACIAL STATEMENTS
CNI CHARTER FUNDS | PAGE 20
schedule of investments
September 30, 2009
- --------------------------------------------------------------------------------
LARGE CAP VALUE EQUITY FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
Edison International 32,600 $ 1,095
Entergy 6,800 543
FirstEnergy 7,600 348
FPL Group 10,200 563
PPL 24,100 731
- ------------------------------------------------------------------------
TOTAL ELECTRIC UTILITIES 4,054
========================================================================
ELECTRICAL EQUIPMENT [1.0%]
Corning 37,100 568
Emerson Electric 10,200 409
- ------------------------------------------------------------------------
TOTAL ELECTRICAL EQUIPMENT 977
========================================================================
ENERGY EQUIPMENT & SERVICES [0.3%]
National Oilwell Varco* 5,500 237
========================================================================
FOOD & STAPLES RETAILING [3.7%]
CVS 20,700 740
Kroger 30,800 635
Safeway 21,400 422
Wal-Mart Stores 31,000 1,522
- ------------------------------------------------------------------------
TOTAL FOOD & STAPLES RETAILING 3,319
========================================================================
FOOD PRODUCTS [1.9%]
Archer-Daniels-Midland 22,400 654
ConAgra Foods 12,500 271
General Mills 7,500 483
Sara Lee 27,000 301
- ------------------------------------------------------------------------
TOTAL FOOD PRODUCTS 1,709
========================================================================
HEALTH CARE EQUIPMENT & SUPPLIES [1.8%]
Baxter International 12,500 713
Becton Dickinson 5,500 383
Covidien 12,800 554
- ------------------------------------------------------------------------
TOTAL HEALTH CARE
EQUIPMENT & SUPPLIES 1,650
========================================================================
HEALTH CARE PROVIDERS & SERVICES [2.6%]
Aetna 27,600 768
Cigna 23,500 660
McKesson 15,000 894
- ------------------------------------------------------------------------
TOTAL HEALTH CARE
PROVIDERS & SERVICES 2,322
========================================================================
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
HOTELS, RESTAURANTS & LEISURE [1.2%]
Carnival 14,300 $ 476
Darden Restaurants 17,000 580
- ------------------------------------------------------------------------
TOTAL HOTELS, RESTAURANTS & LEISURE 1,056
========================================================================
HOUSEHOLD DURABLES [0.7%]
Whirlpool 8,700 609
========================================================================
HOUSEHOLD PRODUCTS [1.8%]
Procter & Gamble 28,500 1,651
========================================================================
INDUSTRIAL CONGLOMERATES [2.0%]
General Electric 80,500 1,322
Tyco International 13,600 469
- ------------------------------------------------------------------------
TOTAL INDUSTRIAL CONGLOMERATES 1,791
========================================================================
INSURANCE [8.9%]
ACE 24,600 1,315
Aflac 16,000 684
Allstate 17,000 521
Assurant 14,800 475
Chubb 23,000 1,159
MetLife 38,406 1,462
Prudential Financial 7,800 389
Travelers 27,000 1,329
Unum Group 30,000 643
- ------------------------------------------------------------------------
TOTAL INSURANCE 7,977
========================================================================
IT SERVICES [0.3%]
Western Union 16,000 303
========================================================================
MACHINERY [1.3%]
Caterpillar 10,600 544
Eaton 3,900 221
Parker Hannifin 7,700 399
- ------------------------------------------------------------------------
TOTAL MACHINERY 1,164
========================================================================
MEDIA [4.1%]
CBS, Cl B 31,250 376
Comcast, Cl A 48,200 814
Omnicom Group 14,700 543
Time Warner 27,933 804
Viacom, Cl B* 23,000 645
Walt Disney 18,100 497
- ------------------------------------------------------------------------
TOTAL MEDIA 3,679
========================================================================
SEE ACCOMPANYING NOTES TO FINANACIAL STATEMENTS
CNI CHARTER FUNDS | PAGE 21
schedule of investments
SEPTEMBER 30, 2009
- ------------------------------------------------------------------------
LARGE CAP VALUE EQUITY FUND (CONCLUDED)
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
METALS & MINING [0.2%]
United States Steel 4,000 $ 178
========================================================================
MULTILINE RETAIL [0.8%]
Target 15,500 724
========================================================================
MULTI-UTILITIES [3.0%]
Dominion Resources 13,700 473
PG&E 20,300 822
Public Service Enterprise Group 22,100 695
Sempra Energy 14,000 697
- -----------------------------------------------------------------------
TOTAL MULTI-UTILITIES 2,687
========================================================================
OIL, GAS & CONSUMABLE FUELS [2.8%]
Chevron 8,240 580
ConocoPhillips 10,580 478
Occidental Petroleum 19,000 1,490
- ------------------------------------------------------------------------
TOTAL OIL, GAS & CONSUMABLE FUELS 2,548
========================================================================
PAPER & FOREST PRODUCTS [0.5%]
MeadWestvaco 20,400 455
========================================================================
PHARMACEUTICALS [6.1%]
Abbott Laboratories 21,700 1,074
Bristol-Myers Squibb 66,000 1,486
Eli Lilly 16,000 528
Merck 23,100 731
Pfizer 104,000 1,721
- ------------------------------------------------------------------------
TOTAL PHARMACEUTICALS 5,540
========================================================================
ROAD & RAIL [3.0%]
CSX 31,400 1,315
Norfolk Southern 12,600 543
Union Pacific 14,500 846
- -----------------------------------------------------------------------
TOTAL ROAD & RAIL 2,704
========================================================================
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT [1.2%]
Texas Instruments 44,900 1,063
========================================================================
SOFTWARE [1.1%]
Microsoft 37,500 971
========================================================================
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
SPECIALTY RETAIL [1.9%]
Best Buy 12,200 $ 458
Lowe's 22,500 471
RadioShack 21,200 351
Sherwin-Williams 8,200 493
========================================================================
TOTAL SPECIALTY RETAIL 1,773
========================================================================
TEXTILES, APPAREL & LUXURY GOODS [1.3%]
Nike, Cl B 17,900 1,158
=======================================================================
WIRELESS TELECOMMUNICATION SERVICES [0.1%]
Sprint Nextel* 20,000 79
========================================================================
TOTAL COMMON STOCK
(Cost $ 92,437) 88,718
========================================================================
CASH EQUIVALENTS [1.7%]
Fidelity Institutional Domestic
Money Market Portfolio,
Cl I, 0.270%** 766,710 767
Goldman Sachs Financial
Square Funds - Government
Fund, 0.080%** 789,008 789
- ------------------------------------------------------------------------
TOTAL CASH EQUIVALENTS
(Cost $ 1,556) 1,556
========================================================================
TOTAL INVESTMENTS [100.0%]
(Cost $ 93,993) $ 90,274
========================================================================
- ----------
Percentages are based on Net Assets of $90,268 ($ Thousands).
* Non-income producing security.
** The rate reported is the 7-day current yield as of September 30, 2009.
Cl -- Class
The following is a summary of the inputs used as of September
30, 2009 in valuing the Fund's investments carried at value ($ Thousands):
Investments in Securities Level 1 Level 2 Level 3 Total
-------- ------- ------- -------
Common Stock $ 88,718 $ -- $ -- $88,718
Cash Equivalents 1,556 -- -- 1,556
-------- ------- ------- -------
Total Investments in
Securities $ 90,274 $ -- $ -- $90,274
======== ======= ======= =======
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
See accompanying notes to financial statements.
CNI CHARTER FUNDS | PAGE 22
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
LARGE CAP GROWTH EQUITY FUND
SECTOR WEIGHTINGS (UNAUDITED)*:
(BAR CHART)
Information Technology 28.9%
Energy 19.4%
Healthcare 13.5%
Consumer Staples 11.3%
Consumer Discretionary 8.3%
Industrials 8.3%
Financials 5.7%
Materials 2.5%
Short-Term Investments 1.9%
Utilities 0.2%
- ------------------
* Percentages based on total investments.
- ------------------------------------------------------------------------
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
COMMON STOCK [98.1%]
AEROSPACE & DEFENSE [2.9%]
Boeing 3,900 $ 211
L-3 Communications Holdings,
Cl 3 3,000 241
Lockheed Martin 3,300 258
Precision Castparts 3,600 367
- ------------------------------------------------------------------------
TOTAL AEROSPACE & DEFENSE 1,077
========================================================================
AIR FREIGHT & LOGISTICS [0.7%]
Expeditors International of
Washington 7,700 271
========================================================================
BEVERAGES [2.8%]
Coca-Cola 5,800 311
PepsiCo 12,200 716
- ------------------------------------------------------------------------
TOTAL BEVERAGES 1,027
========================================================================
BIOTECHNOLOGY [4.1%]
Amgen* 4,000 241
Celgene* 7,000 391
Genzyme - General Division* 6,500 369
Gilead Sciences* 11,400 531
- ------------------------------------------------------------------------
TOTAL BIOTECHNOLOGY 1,532
========================================================================
CAPITAL MARKETS [4.1%]
Franklin Resources 4,500 453
Goldman Sachs Group 4,000 737
T Rowe Price Group 7,000 320
- ------------------------------------------------------------------------
TOTAL CAPITAL MARKETS 1,510
========================================================================
- ------------------------------------------------------------------------
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
CHEMICALS [0.9%]
Monsanto 4,200 $ 325
========================================================================
COMMERCIAL SERVICES & SUPPLIES [0.7%]
Pitney Bowes 2,100 52
RR Donnelley & Sons 9,900 211
- ------------------------------------------------------------------------
TOTAL COMMERCIAL SERVICES
& SUPPLIES 263
========================================================================
COMMUNICATIONS EQUIPMENT [4.1%]
Cisco Systems* 8,000 188
Harris 5,100 192
Qualcomm 25,500 1,147
- ------------------------------------------------------------------------
TOTAL COMMUNICATIONS
EQUIPMENT 1,527
========================================================================
COMPUTERS & PERIPHERALS [7.3%]
Apple* 4,575 848
Hewlett-Packard 13,723 648
IBM 10,200 1,220
-------------------------------------------------------------------
TOTAL COMPUTERS &
PERIPHERALS 2,716
========================================================================
CONSTRUCTION & ENGINEERING [0.9%]
Fluor 3,500 178
Jacobs Engineering Group* 3,700 170
-------------------------------------------------------------------
TOTAL CONSTRUCTION &
ENGINEERING 348
========================================================================
DIVERSIFIED CONSUMER SERVICES [0.4%]
Apollo Group, Cl A* 2,000 147
========================================================================
DIVERSIFIED FINANCIAL SERVICES [0.6%]
CME Group, Cl A 700 216
========================================================================
ELECTRIC UTILITIES [0.2%]
Edison International 2,200 74
========================================================================
ENERGY EQUIPMENT & SERVICES [4.7%]
Baker Hughes 4,500 192
ENSCO International 10,300 438
Noble 8,000 304
Schlumberger 11,300 673
Smith International 4,700 135
- ------------------------------------------------------------------------
TOTAL ENERGY EQUIPMENT &
SERVICES 1,742
========================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 23
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
LARGE CAP GROWTH EQUITY FUND (CONTINUED)
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
FOOD & STAPLES RETAILING [2.4%]
Wal-Mart Stores 18,075 $ 887
========================================================================
FOOD PRODUCTS [1.1%]
Campbell Soup 3,500 114
Kellogg 5,700 281
- ------------------------------------------------------------------------
TOTAL FOOD PRODUCTS 395
========================================================================
HEALTH CARE EQUIPMENT & SUPPLIES [3.2%]
Bard (C.R.) 3,200 252
Baxter International 5,000 285
Stryker 9,300 422
Zimmer Holdings* 4,000 214
- ------------------------------------------------------------------------
TOTAL HEALTH CARE
EQUIPMENT & SUPPLIES 1,173
========================================================================
HEALTH CARE PROVIDERS & SERVICES [2.3%]
DaVita* 3,400 193
McKesson 3,300 196
UnitedHealth Group 18,700 468
- ------------------------------------------------------------------------
TOTAL HEALTH CARE PROVIDERS
& SERVICES 857
========================================================================
HOUSEHOLD PRODUCTS [4.3%]
Colgate-Palmolive 9,400 717
Procter & Gamble 15,102 875
- ------------------------------------------------------------------------
TOTAL HOUSEHOLD PRODUCTS 1,592
========================================================================
INSURANCE [0.7%]
Aflac 6,600 282
========================================================================
INTERNET & CATALOG RETAIL [1.1%]
Amazon.Com* 4,400 411
========================================================================
INTERNET SOFTWARE & SERVICES [6.1%]
eBay* 30,575 722
Google, Cl A* 2,600 1,289
Yahoo!* 15,000 267
- ------------------------------------------------------------------------
TOTAL INTERNET SOFTWARE &
SERVICES 2,278
========================================================================
IT SERVICES [1.2%]
Cognizant Technology Solutions,
Cl A* 6,700 259
Western Union 9,600 182
- ------------------------------------------------------------------------
TOTAL IT SERVICES 441
========================================================================
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
MACHINERY [2.2%]
Caterpillar 10,700 $ 549
Danaher 4,100 276
- ------------------------------------------------------------------------
TOTAL MACHINERY 825
========================================================================
MEDIA [1.8%]
Comcast, Cl A 18,150 306
DIRECTV Group* 4,900 135
Omnicom Group 6,000 222
- ------------------------------------------------------------------------
TOTAL MEDIA 663
========================================================================
METALS & MINING [1.6%]
Freeport-McMoRan Copper
& Gold 6,000 412
Nucor 4,200 197
- ------------------------------------------------------------------------
TOTAL METALS & MINING 609
========================================================================
MULTILINE RETAIL [0.5%]
Target 4,000 187
========================================================================
OIL, GAS & CONSUMABLE FUELS [14.7%]
Apache 3,300 303
Chevron 18,000 1,268
EOG Resources 4,900 409
Exxon Mobil 32,000 2,196
Hess 2,800 150
Occidental Petroleum 7,000 549
Southwestern Energy* 5,000 213
XTO Energy 9,400 388
- ------------------------------------------------------------------------
TOTAL OIL, GAS &
CONSUMABLE FUELS 5,476
========================================================================
PERSONAL PRODUCTS [0.7%]
Avon Products 8,300 282
========================================================================
PHARMACEUTICALS [3.9%]
Abbott Laboratories 5,000 248
Allergan 3,600 204
Johnson & Johnson 16,664 1,015
- ------------------------------------------------------------------------
TOTAL PHARMACEUTICALS 1,467
========================================================================
PROFESSIONAL SERVICES [0.6%]
Robert Half International 8,400 210
========================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 24
schedule of investments
SEPTEMBER 30, 2009
- ------------------------------------------------------------------------
LARGE CAP GROWTH EQUITY FUND (CONCLUDED)
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
ROAD & RAIL [0.3%]
CSX 2,300 $ 96
========================================================================
SEMICONDUCTORS &
SEMICONDUCTOR EQUIPMENT [1.6%]
Intel 5,000 98
MEMC Electronic Materials* 9,500 158
Texas Instruments 14,400 341
- ------------------------------------------------------------------------
TOTAL SEMICONDUCTORS &
SEMICONDUCTOR EQUIPMENT 597
========================================================================
SOFTWARE [8.6%]
Adobe Systems* 6,000 198
Autodesk* 5,000 119
Microsoft 62,180 1,610
Oracle 43,265 901
Symantec* 21,300 351
- ------------------------------------------------------------------------
TOTAL SOFTWARE 3,179
========================================================================
SPECIALTY RETAIL [2.0%]
Autozone* 2,500 366
Best Buy 4,900 184
GameStop, Cl A* 8,100 214
- ------------------------------------------------------------------------
TOTAL SPECIALTY RETAIL 764
========================================================================
TEXTILES, APPAREL & LUXURY GOODS [2.5%]
Coach* 18,100 596
Nike, Cl B 5,000 323
- ------------------------------------------------------------------------
TOTAL TEXTILES, APPAREL &
LUXURY GOODS 919
========================================================================
THRIFTS & MORTGAGE FINANCE [0.3%]
Hudson City Bancorp 8,000 105
========================================================================
TOTAL COMMON STOCK
(Cost $35,797) 36,470
========================================================================
DESCRIPTION SHARES VALUE (000)
- ------------------------------------------------------------------------
CASH EQUIVALENTS [1.9%]
Fidelity Institutional Domestic
Money Market Portfolio, Cl I,
0.270%** 561,337 $ 561
Goldman Sachs Financial Square
Funds - Government Fund,
0.080%** 151,553 152
- ------------------------------------------------------------------------
TOTAL CASH EQUIVALENTS
(Cost $ 713) 713
========================================================================
TOTAL INVESTMENTS [100.0%]
(Cost $ 36,510) $ 37,183
========================================================================
- ----------
PERCENTAGES ARE BASED ON NET ASSETS OF $37,170 ($ THOUSANDS).
* NON-INCOME PRODUCING SECURITY.
** THE RATE REPORTED IS THE 7-DAY CURRENT YIELD AS OF SEPTEMBER 30, 2009.
CL -- CLASS
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands):
Investments in Securities Level 1 Level 2 Level 3 Total
--------- -------- ------- -------
Common Stock $ 36,470 $ -- $ -- $36,470
Cash Equivalents 713 -- -- 713
-------- ------- ------- -------
Total Investments in
Securities $ 37,183 $ -- $ -- $37,183
======== ======= ======= =======
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 25
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
RCB SMALL CAP VALUE FUND
(BAR CHART)
SECTOR WEIGHTINGS (UNAUDITED)*:
Consumer Discretionary 24.3%
Financials 20.2%
Materials 10.6%
Short-Term Investments 10.6%
Industrials 10.2%
Consumer Staples 9.7%
Information Technology 8.9%
Healthcare 3.5%
Energy 2.0%
- ----------
* Percentages based on total investments.
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
COMMON STOCK [90.7%]
CHEMICALS [6.5%]
Nalco Holding 48,200 $ 988
Spartech 49,400 532
- ---------------------------------------------------------------
TOTAL CHEMICALS 1,520
===============================================================
COMMERCIAL BANKS [2.6%]
Wilmington Trust 42,300 600
===============================================================
CONSTRUCTION MATERIALS [2.1%]
Eagle Materials 17,000 486
===============================================================
DIVERSIFIED CONSUMER SERVICES [2.0%]
Coinstar* 14,300 472
===============================================================
ENERGY EQUIPMENT & SERVICES [2.0%]
Exterran Holdings* 19,400 461
===============================================================
FOOD PRODUCTS [3.7%]
Ralcorp Holdings* 14,700 859
===============================================================
FOOD, BEVERAGE & TOBACCO [2.0%]
Universal 11,300 473
===============================================================
HOTELS, RESTAURANTS & LEISURE [4.1%]
Wendy's/Arby's Group, Cl A 200,039 946
===============================================================
HOUSEHOLD PRODUCTS [6.3%]
Central Garden & Pet, Cl A* 88,500 967
Scotts Miracle-Gro, Cl A 11,900 511
- ---------------------------------------------------------------
TOTAL HOUSEHOLD PRODUCTS 1,478
===============================================================
DESCRIPTION SHARES VALUE (000)
- ---------------------------------------------------------------
INSURANCE [13.8%]
Alleghany* 3,837 $ 994
First American 17,100 554
Hilltop Holdings* 35,500 435
White Mountains Insurance
Group 4,000 1,228
- ---------------------------------------------------------------
TOTAL INSURANCE 3,211
===============================================================
INTERNET & CATALOG RETAIL [4.4%]
Liberty Media - Interactive,
Ser A* 93,900 1,030
===============================================================
INTERNET SOFTWARE & SERVICES [3.2%]
United Online 93,000 748
===============================================================
IT SERVICES [2.1%]
Global Cash Access Holdings* 67,100 490
===============================================================
LIFE SCIENCES TOOLS & SERVICES [3.6%]
PerkinElmer 43,600 839
===============================================================
MACHINERY [10.4%]
Actuant, Cl A 60,900 978
Altra Holdings* 50,000 560
Crane 17,700 457
IDEX 15,400 430
===============================================================
TOTAL MACHINERY 2,425
===============================================================
MEDIA [12.0%]
Fisher Communications* 9,899 180
Liberty Media - Capital,
Ser A* 48,102 1,006
Virgin Media 42,300 589
Washington Post, Cl B 2,200 1,030
- ---------------------------------------------------------------
TOTAL MEDIA 2,805
===============================================================
REAL ESTATE INVESTMENT TRUSTS [4.1%]
Chimera Investment 251,000 959
===============================================================
SOFTWARE [3.7%]
Fair Isaac 21,300 458
PLATO Learning* 92,400 399
- ---------------------------------------------------------------
TOTAL SOFTWARE 857
===============================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 26
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
RCB SMALL CAP VALUE FUND (CONCLUDED)
SHARES/FACE
DESCRIPTION AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------
SPECIALTY RETAIL [2.1%]
Syms* 60,000 $ 485
==========================================================================
TOTAL COMMON STOCK
(Cost $ 17,301) 21,144
==========================================================================
REPURCHASE AGREEMENT (A) [10.8%]
Morgan Stanley
0.040%, dated 09/30/09,
repurchased on 10/01/09,
repurchase price $ 2,509,495
(collateralized by a U.S.
Treasury Note, par value
$1,501,502, 3.875%, 4/15/29;
with total market value
$2,559,687) $ 2,509 2,509
- --------------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENT
(Cost $2,509) 2,509
==========================================================================
TOTAL INVESTMENTS [101.5%]
(Cost $19,810) $ 23,653
==========================================================================
- ----------
PERCENTAGES ARE BASED ON NET ASSETS OF $23,298 ($ THOUSANDS).
* NON-INCOME PRODUCING SECURITY.
(A) TRI-PARTY REPURCHASE AGREEMENT
CL -- CLASS
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands):
Investments in Securities Level 1 Level 2 Level 3 Total
------- ------- ------- -------
Common Stock $21,144 $ -- $ -- $21,144
Repurchase Agreement -- 2,509 -- 2,509
------- ------ ------- -------
Total Investments in
Securities $21,144 $2,509 $ -- $23,653
======= ====== ======= =======
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 27
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
OPPORTUNISTIC VALUE FUND
SECTOR WEIGHTINGS (UNAUDITED)*:
(BAR CHART)
Financials 20.9%
Healthcare 17.1%
Energy 15.0%
Information Technology 12.8%
Consumer Staples 9.8%
Materials 7.4%
Industrials 6.8%
Consumer Discretionary 4.3%
Short-Term Investments 4.0%
Telecommunication Services 1.9%
- ----------
* Percentages based on total investments.
DESCRIPTION SHARES VALUE (000)
- ----------------------------------------------------------
COMMON STOCK [96.9%]
BEVERAGES [2.3%]
PepsiCo 10,200 $ 598
==========================================================
CHEMICALS [1.4%]
Potash Corp of Saskatchewan 4,000 361
==========================================================
COMMERCIAL BANKS [7.0%]
BB&T 9,300 253
M&T Bank 6,800 424
US Bancorp 41,000 896
Wells Fargo 9,000 254
- ----------------------------------------------------------
TOTAL COMMERCIAL BANKS 1,827
==========================================================
COMMERCIAL SERVICES & SUPPLIES
[1.2%]
Avery Dennison 8,400 303
==========================================================
COMMUNICATIONS EQUIPMENT [2.7%]
Nokia ADR 48,000 702
==========================================================
COMPUTERS & PERIPHERALS [2.7%]
Dell* 45,500 694
==========================================================
CONTAINERS & PACKAGING [3.9%]
Crown Holdings* 18,100 492
Sealed Air 27,900 548
- ----------------------------------------------------------
TOTAL CONTAINERS & PACKAGING 1,040
==========================================================
DISTRIBUTORS [1.4%]
Genuine Parts 10,000 381
==========================================================
DESCRIPTION SHARES VALUE (000)
- ----------------------------------------------------------
DIVERSIFIED FINANCIAL SERVICES
[3.1%]
IntercontinentalExchange* 2,100 $ 204
Nasdaq OMX Group* 29,000 611
- ----------------------------------------------------------
TOTAL DIVERSIFIED FINANCIAL
SERVICES 815
==========================================================
DIVERSIFIED TELECOMMUNICATION
SERVICES [1.9%]
AT&T 18,500 500
==========================================================
ELECTRICAL EQUIPMENT [2.2%]
Baldor Electric 21,400 585
==========================================================
ENERGY EQUIPMENT & SERVICES
[5.5%]
Exterran Holdings* 27,800 660
Unit* 19,000 784
- ----------------------------------------------------------
TOTAL ENERGY EQUIPMENT &
SERVICES 1,444
==========================================================
FOOD & STAPLES RETAILING [4.7%]
SUPERVALU 37,900 571
Walgreen 18,000 674
- ----------------------------------------------------------
TOTAL FOOD & STAPLES RETAILING 1,245
==========================================================
FOOD PRODUCTS [2.9%]
Del Monte Foods 65,600 760
==========================================================
HEALTH CARE EQUIPMENT & SUPPLIES
[2.9%]
Covidien 17,900 774
==========================================================
HEALTH CARE PROVIDERS & SERVICES
[9.5%]
Laboratory Corp of America
Holdings* 7,800 513
McKesson 10,900 649
Patterson* 20,300 553
Quest Diagnostics 14,700 767
- ----------------------------------------------------------
TOTAL HEALTH CARE PROVIDERS
& SERVICES 2,482
==========================================================
INDUSTRIAL CONGLOMERATES [3.4%]
Tyco International 26,200 903
==========================================================
INSURANCE [8.0%]
Chubb 14,000 706
HCC Insurance Holdings 32,400 886
Unum Group 24,000 514
- ----------------------------------------------------------
TOTAL INSURANCE 2,106
==========================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 28
schedule of investments
SEPTEMBER 30, 2009
- -------------------------------------------------------------------------------
OPPORTUNISTIC VALUE FUND (CONCLUDED)
DESCRIPTION SHARES VALUE (000)
- -----------------------------------------------------------
LEISURE EQUIPMENT & PRODUCTS
[1.0%]
Mattel 14,300 $ 264
===========================================================
LIFE SCIENCES TOOLS & SERVICES
[1.5%]
Pharmaceutical Product
Development 17,600 386
===========================================================
MEDIA [1.9%]
Time Warner 17,166 494
===========================================================
METALS & MINING [2.2%]
Cliffs Natural Resources 17,600 570
===========================================================
OFFICE ELECTRONICS [1.7%]
Xerox 57,200 443
===========================================================
OIL, GAS & CONSUMABLE FUELS
[9.7%]
Chesapeake Energy 18,200 517
ConocoPhillips 11,000 497
Newfield Exploration* 13,800 587
Spectra Energy 34,400 651
Valero Energy 14,600 283
- -----------------------------------------------------------
TOTAL OIL, GAS &
CONSUMABLE FUELS 2,535
===========================================================
PHARMACEUTICALS [3.3%]
Bristol-Myers Squibb 11,100 250
Mylan* 39,100 626
- -----------------------------------------------------------
TOTAL PHARMACEUTICALS 876
===========================================================
REAL ESTATE MANAGEMENT &
DEVELOPMENT [3.0%]
Brookfield Asset Management,
ClA 34,700 788
===========================================================
SEMICONDUCTORS & SEMICONDUCTOR
EQUIPMENT [1.8%]
Applied Materials 35,500 476
===========================================================
SOFTWARE [4.1%]
Microsoft 10,800 279
Symantec* 49,000 807
- -----------------------------------------------------------
TOTAL SOFTWARE 1,086
===========================================================
TOTAL COMMON STOCK
(Cost $18,237) 25,438
===========================================================
DESCRIPTION SHARES VALUE (000)
- -----------------------------------------------------------
CASH EQUIVALENT [4.0%]
First American Prime
Obligations Fund,
ClY, 0.000%** 1,054,216 $ 1,054
- -----------------------------------------------------------
TOTAL CASH EQUIVALENT
(Cost $ 1,054) 1,054
===========================================================
TOTAL INVESTMENTS [100.9%]
(Cost $19,291) $ 26,492
===========================================================
PERCENTAGES ARE BASED ON Net ASSETS OF $26,265 ($ THOUSANDS).
- ----------
* NON-INCOME PRODUCING SECURITY.
** THE RATE REPORTED IS THE 7-DAY CURRENT YIELD AS OF SEPTEMBER 30, 2009.
ADR -- AMERICAN DEPOSITARY RECEIPT
CL -- CLASS
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands):
Investments in Securities Leve1 1 Level 2 Level 3 Total
------- ------- ------- -------
Common Stock $25,438 $ -- $ -- $25,438
Cash Equivalent 1,054 -- -- 1,054
------- ------- ------- -------
Total Investments in
Securities $26,492 $ -- $ -- $26,492
======= ======= ======= =======
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 29
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
MULTI-ASSET FUND
(BAR CHART)
TYPE OF SECURITY WEIGHTINGS (UNAUDITED)*:
Exchange Traded Funds 58.7%
Affiliated Investment Funds 15.6%
Short-Term Investments 8.6%
Registered Investment Company 8.1%
U.S. Government Agency Obligations 6.1%
Municipal Bond 2.9%
- ----------
* Percentages based on total investments.
SHARES/FACE
DESCRIPTION AMOUNT(000) VALUE (000)
- ------------------------------------------------------------------------------
EXCHANGE TRADED FUNDS [57.4%]
iShares Barclays 1-3 Year
Credit Bond Fund 20,861 $ 2,177
iShares MSCI EAFE
Index Fund 23,787 1,301
iShares Russell 2000 Growth
Index Fund 10,931 716
iShares S&P MidCap 400
Index Fund 17,974 1,240
SPDR S&P 500 Fund 65,600 6,925
Vanguard Emerging Markets 36,365 1,402
Vanguard Small Cap Growth 12,933 743
- ----------------------------------------------------------------------------
TOTAL EXCHANGE TRADED FUNDS
(Cost $13,658) 14,504
============================================================================
AFFILIATED INVESTMENT FUNDS [15.2%]
CNI Corporate Bond Fund,
Institutional Class 203,774 2,152
CNI Government Bond Fund,
Institutional Class 159,667 1,689
- ----------------------------------------------------------------------------
TOTAL AFFILIATED INVESTMENT FUNDS
(Cost $3,755) 3,841
============================================================================
REGISTERED INVESTMENT COMPANIES [7.9%]
Alpine International Real Estate
Equity Fund 39,587 909
Cohen & Steers International
Realty Fund, Inc. 97,581 1,093
- ----------------------------------------------------------------------------
TOTAL REGISTERED INVESTMENT COMPANIES
(Cost $1,779) 2,002
============================================================================
U.S. GOVERNMENT AGENCY OBLIGATIONS [6.0%]
FHLB (A)
0.500%, 11/05/09 $ 750 750
FNMA (B)
0.400%, 07/13/10 750 750
- ----------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT AGENCY OBLIGATIONS
(Cost $1,500) 1,500
============================================================================
FACE AMOUNT
DESCRIPTION (000)/SHARES VALUE (000)
- ------------------------------------------------------------------------------
MUNICIPAL BOND [2.8%]
CALIFORNIA [2.8%]
State of California,
Sub-Ser A-2, RAN
3.000%, 06/23/10 $ 700 $ 709
- ----------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(Cost $ 707) 709
============================================================================
CASH EQUIVALENT [8.5%]
Goldman Sachs
Financial Square Funds -
Government Fund,
0.080%* 2,136,617 $ 2,137
- ----------------------------------------------------------------------------
TOTAL CASH EQUIVALENT
(Cost $ 2,137) 2,137
============================================================================
TOTAL INVESTMENTS [97.8%]
(Cost $ 23,536) $ 24,693
============================================================================
- ----------
PERCENTAGES ARE BASED ON NET ASSETS OF $25,260 ($ THOUSANDS).
* THE RATE REPORTED IS THE 7-DAY EFFECTIVE YIELD AS OF SEPTEMBER 30, 2009.
(A) FLOATING RATE SECURITY -- THE RATE REFLECTED IS THE RATE IN EFFECT ON
SEPTEMBER 30, 2009.
(B) STEP BOND -- THE RATE REPORTED IS THE CURRENT YIELD AT TIME OF PURCHASE.
EAFE -- EUROPE AUSTRALIASIA AND THE FAR EAST
FHLB -- FEDERAL HOME LOAN BANK
FNMA -- FEDERAL NATIONAL MORTGAGE ASSOCIATION
MSCI -- MORGAN STANLE CAPITAL INTERNATIONAL
RAN -- REVENUE ANTICIPATION NOTE
SER -- SERIES
SPDR -- STANDARD & POOR'S DEPOSITORY RECEIPTS
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands):
Investments in Securities Level 1 Level 2 Level 3 Total
-------- ------- ------- --------
Exchange Traded Fund $ 14,504 $ -- $ -- $ 14,504
Affiliated Investment Funds 3,841 -- -- 3,841
Registered Investment
Companies 2,002 -- -- 2,002
U.S. Government Agency
Obligations -- 1,500 -- 1,500
Municipal Bond -- 709 -- 709
Cash Equivalent 2,137 -- -- 2,137
-------- ------- ------- --------
Total Investments in
Securities $ 22,484 $ 2,209 $ -- $ 24,693
======== ======= ======= ========
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 30
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CORPORATE BOND FUND
ISSUER INDUSTRY WEIGHTINGS (UNAUDITED)*:
(BAR CHART)
Financials 37.0%
Industrials 29.5%
Banks 14.2%
Utilities 5.3%
Municipal Bonds 3.8%
U.S. Government Mortgage-Backed Obligations 3.6%
Short-Term Investment 2.5%
Telephone 2.3%
U.S. Treasury Obligation 0.7%
U.S. Government Agency Obligations 0.6%
Foreign Governments 0.5%
- ----------
* Percentages based on total investments.
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -----------------------------------------------------------------------------
CORPORATE BONDS [87.4%]
APPLICATIONS SOFTWARE [2.3%]
Microsoft
4.200%, 06/01/19 $ 2,000 $ 2,059
=============================================================================
BANKS [14.0%]
Bank of America, MTN
3.125%, 06/15/12 1,500 1,560
Barclays Bank (A)
6.050%, 12/04/17 1,000 1,006
Deutsche Bank
7.250%, 10/15/11 500 527
JPMorgan Chase Bank
6.000%, 10/01/17 1,000 1,052
PNC Funding, FDIC Insured
1.875%, 06/22/11 1,150 1,164
US Bank
6.375%, 08/01/11 1,485 1,604
Wachovia Bank
4.800%, 11/01/14 1,270 1,289
Wells Fargo Bank
7.550%, 06/21/10 1,000 1,046
Wells Fargo Bank
4.625%, 08/09/10 1,000 1,033
Wells Fargo, FDIC Insured
3.000%, 12/09/11 2,200 2,278
- -----------------------------------------------------------------------------
TOTAL BANKS 12,559
=============================================================================
BEAUTY PRODUCTS [0.9%]
Avon Products
7.150%, 11/15/09 800 805
=============================================================================
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -----------------------------------------------------------------------------
CHEMICALS [1.0%]
Dow Chemical
8.550%, 05/15/19 $ 835 $ 939
=============================================================================
COMMUNICATION & MEDIA [3.0%]
AOL Time Warner
6.750%, 04/15/11 415 443
Comcast Cable Communications
Holdings
8.375%, 03/15/13 160 186
News America Holdings
9.250%, 02/01/13 475 558
Walt Disney, MTN
5.700%, 07/15/11 1,395 1,493
- -----------------------------------------------------------------------------
TOTAL COMMUNICATION & MEDIA 2,680
=============================================================================
COMPUTER SYSTEM DESIGN & SERVICES [6.6%]
Cisco Systems
5.500%, 02/22/16 1,250 1,376
Dell
5.625%, 04/15/14 1,000 1,105
Hewlett-Packard
6.125%, 03/01/14 1,475 1,661
International Business Machines
7.625%, 10/15/18 1,500 1,846
- -----------------------------------------------------------------------------
TOTAL COMPUTER SYSTEM
DESIGN & SERVICES 5,988
=============================================================================
DIVERSIFIED OPERATIONS [0.6%]
3M, MTN
4.375%, 08/15/13 500 535
=============================================================================
DRUGS [2.6%]
Wyeth
6.950%, 03/15/11 2,170 2,332
=============================================================================
ELECTRIC UTILITIES [1.0%]
Exelon
4.900%, 06/15/15 889 922
=============================================================================
ELECTRICAL SERVICES [3.4%]
Alabama Power
4.850%, 12/15/12 1,430 1,551
American Electric Power
5.250%, 06/01/15 490 513
WPS Resources
7.000%, 11/01/09 1,000 1,004
- -----------------------------------------------------------------------------
TOTAL ELECTRICAL SERVICES 3,068
=============================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 31
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CORPORATE BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -----------------------------------------------------------------------------
FINANCE AUTO LOANS [3.2%]
American Honda Finance,
MTN (A)
5.125%, 12/15/10 $ 1,000 $ 1,028
Toyota Motor Credit
4.350%, 12/15/10 1,800 1,838
- -----------------------------------------------------------------------------
TOTAL FINANCE AUTO LOANS 2,866
=============================================================================
FINANCIAL SERVICES [13.8%]
AXA Financial
7.750%, 08/01/10 1,000 1,043
Boeing Capital
6.500%, 02/15/12 930 1,024
General Electric Capital, Ser A,
MTN
6.875%, 11/15/10 250 264
6.000%, 06/15/12 2,180 2,335
General Electric Capital,
FDIC Insured
2.200%, 06/08/12 2,805 2,848
GMAC, FDIC Insured
2.200%, 12/19/12 2,500 2,527
HSBC Finance
5.250%, 04/15/15 1,250 1,271
National Rural Utilities, Ser C,
MTN
7.250%, 03/01/12 1,000 1,105
- -----------------------------------------------------------------------------
TOTAL FINANCIAL SERVICES 12,417
=============================================================================
FOOD, BEVERAGE & TOBACCO [4.4%]
Anheuser-Busch
7.500%, 03/15/12 665 732
Bottling Group
5.500%, 04/01/16 1,000 1,093
4.625%, 11/15/12 1,435 1,547
General Mills
6.000%, 02/15/12 560 608
- -----------------------------------------------------------------------------
TOTAL FOOD, BEVERAGE & TOBACCO 3,980
=============================================================================
FOREIGN GOVERNMENTS [0.5%]
United Mexican States, MTN
5.875%, 01/15/14 450 482
=============================================================================
INSURANCE [1.7%]
Berkshire Hathaway Finance
4.125%, 01/15/10 1,475 1,493
=============================================================================
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -----------------------------------------------------------------------------
INVESTMENT BANKER/BROKER DEALER [15.8%]
Citigroup
5.850%, 08/02/16 $ 1,000 $ 978
5.500%, 02/15/17 250 233
Citigroup Funding, FDIC
Insured
2.250%, 12/10/12 2,500 2,533
Credit Suisse
5.500%, 08/15/13 1,250 1,350
Goldman Sachs Group
5.625%, 01/15/17 1,760 1,773
Jefferies Group
5.500%, 03/15/16 665 626
JPMorgan Chase, FDIC
Insured
6.750%, 02/01/11 500 531
2.125%, 12/26/12 2,500 2,534
Merrill Lynch
6.050%, 05/16/16 2,025 2,029
Morgan Stanley
6.750%, 04/15/11 30 32
Morgan Stanley
5.300%, 03/01/13 1,530 1,603
- -----------------------------------------------------------------------------
TOTAL INVESTMENT BANKER/
BROKER DEALER 14,222
=============================================================================
MULTI-LINE INSURANCE [1.9%]
MetLife
7.717%, 02/15/19 1,490 1,754
=============================================================================
PETROLEUM & FUEL PRODUCTS [4.9%]
ConocoPhillips
4.750%, 02/01/14 1,400 1,506
ConocoPhillips Canada
Funding I
5.625%, 10/15/16 600 657
Duke Capital
5.500%, 03/01/14 625 653
Shell International Finance
3.250%, 09/22/15 1,500 1,510
- -----------------------------------------------------------------------------
TOTAL PETROLEUM & FUEL PRODUCTS 4,326
=============================================================================
RETAIL [3.5%]
Home Depot
5.250%, 12/16/13 1,000 1,066
Kohl's
6.300%, 03/01/11 1,000 1,042
Kroger
5.500%, 02/01/13 450 480
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 32
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CORPORATE BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------------
Target
5.875%, 07/15/16 $ 500 $ 553
- ----------------------------------------------------------------------------
TOTAL RETAIL 3,141
============================================================================
TELEPHONES & TELECOMMUNICATIONS [2.3%]
Deutsche Telekom International
Finance
5.250%, 07/22/13 475 507
New Cingular Wireless Services
8.125%, 05/01/12 400 456
Verizon Communications
5.550%, 02/15/16 1,000 1,083
- ----------------------------------------------------------------------------
TOTAL TELEPHONES &
TELECOMMUNICATIONS 2,046
============================================================================
TOTAL CORPORATE BONDS
(Cost $ 75,183) 78,614
============================================================================
MUNICIPAL BONDS [3.7%]
CALIFORNIA [2.5%]
California State, City of
Industry, Sales Tax Project,
RB, NATL-RE
5.000%, 01/01/12 955 969
Irvine Ranch Water District,
RB, ETM
Callable 09/15/11 @ 100
8.180%, 03/15/14 1,200 1,336
- ----------------------------------------------------------------------------
TOTAL CALIFORNIA 2,305
============================================================================
WISCONSIN [1.2%]
De Pere, Unified School District,
GO, FGIC (B)
Pre-Refunded @ 100
4.500%, 10/01/11 995 1,070
============================================================================
TOTAL MUNICIPAL BONDS
(Cost $ 3,317) 3,375
============================================================================
U.S. GOVERNMENT MORTGAGE-BACKED
OBLIGATIONS [3.5%]
FHLMC REMIC, Ser 2982,
ClNB
5.500%, 02/15/29 450 471
FHLMC REMIC, Ser R004,
ClA1
5.125%, 12/15/13 519 541
DESCRIPTION FACE AMOUNT
(000)/SHARES VALUE (000)
- ----------------------------------------------------------------------------
FHLMC REMIC, Ser R015,
ClAN
3.750%, 02/15/13 $ 564 $ 573
FNMA REMIC, Ser 2002-56,
ClMC
5.500%, 09/25/17 619 660
FNMA REMIC, Ser 2006-B1,
ClAB
6.000%, 06/25/16 157 165
FNMA REMIC, Ser 2007-B1,
ClBE
5.450%, 12/25/20 697 740
- ----------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT MORTGAGE-
BACKED OBLIGATIONS
(Cost $ 3,015) 3,150
============================================================================
U.S.TREASURY OBLIGATION [0.7%]
U.S.Treasury Inflation Protection
Security
2.000%, 01/15/14 583 604
- ---------------------------------------------------------------------------
TOTAL U.S.TREASURY OBLIGATION
(Cost $593) 604
===========================================================================
U.S. GOVERNMENT AGENCY OBLIGATION [0.6%]
FHLMC
5.500%, 09/15/11 460 500
- ---------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT
AGENCY OBLIGATION
(Cost $482) 500
===========================================================================
CASH EQUIVALENT [2.5%]
Goldman Sachs Financial Square
Funds - Government Fund,
0.080%* 2,229,995 2,230
- ---------------------------------------------------------------------------
TOTAL CASH EQUIVALENT
(Cost $2,230) 2,230
===========================================================================
TOTAL INVESTMENTS [98.4%]
(Cost $84,820) $ 88,473
===========================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 33
schedule of investments
SEPTEMBER 30, 2009
CORPORATE BOND FUND (CONCLUDED)
DESCRIPTION
- ----------
PERCENTAGES ARE BASED ON NET ASSETS OF $89,892 ($ THOUSANDS).
* THE RATE REPORTED IS THE 7-DAY CURRENT YIELD AS OF SEPTEMBER 30, 2009.
(A) SECURITY EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE SECURITIES ACT OF
1933. THESE SECURITIES MAY BE RESOLD IN TRANSACTIONS EXEMPT FROM
REGISTRATION NORMALLY TO QUALIFIED INSTITUTIONS. ON SEPTEMBER 30, 2009,
THE VALUE OF THESE SECURITIES AMOUNTED TO $2,034 (000), REPRESENTING 2.3%
OF THE NET ASSETS OF THE FUND.
(B) PRE-REFUNDED SECURITY -- THE MATURITY DATE SHOWN IS THE PRE-REFUNDED DATE.
CL -- CLASS
ETM -- ESCROWED TO MATURITY
FDIC -- FEDERAL DEPOSITARY INSURANCE CORPORATION
FGIC -- FINANCIAL GUARANTY INSURANCE COMPANY
FHLMC -- FEDERAL HOME LOAN MORTGAGE CORPORATION
FNMA -- FEDERAL NATIONAL MORTGAGE ASSOCIATION
GO -- GENERAL OBLIGATION
NATL-RE -- NATIONAL PUBLIC FINANCE GUARANTEE CORPORATION (FORMERLY
MUNICIPAL BOND INSURANCE COMPANY 'MBIA')
MTN -- MEDIUM TERM NOTE
RB -- REVENUE BOND
REMIC -- REAL ESTATE MORTGAGE INVESTMENT CONDUIT
SER -- SERIES
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands) :
Investments in Securities Level 1 Level 2 Level 3 Total
------- -------- ------- --------
Corporate Bonds $ -- $ 78,614 $ -- $ 78,614
Municipal Bonds -- 3,375 -- 3,375
U.S. Government Mortgage-
Backed Obligations -- 3,150 -- 3,150
U.S.Treasury Obligation 604 -- 604
U.S. Government Agency
Obligation -- 500 -- 500
Cash Equivalent 2,230 -- -- 2,230
------- -------- ------- --------
Total Investments in
Securities $ 2,230 $ 86,243 $ -- $ 88,473
======= ======== ======= ========
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 34
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
GOVERNMENT BOND FUND
TYPE OF SECURITY WEIGHTINGS (UNAUDITED)*:
(BAR CHART)
U.S. Government Agency Obligations 55.3%
U.S. Government Mortgage-Backed Obligations 43.8%
Short-Term Investments 0.9%
- ----------
* Percentages based on total investments.
DESCRIPTION FACE AMOUNT(000) VALUE (000)
- ------------------------------------------------------------------------------
U.S. GOVERNMENT AGENCY
OBLIGATIONS [55.0%]
FHLB
5.250%, 06/18/14 $ 4,000 $ 4,485
3.625%, 10/18/13 6,000 6,326
2.250%, 04/13/12 7,000 7,153
FHLMC
2.000%, 12/22/11 6,000 6,021
FNMA
6.250%, 02/01/11 5,000 5,295
3.000%, 07/28/14 6,000 6,060
3.000%, 09/15/14 245 246
2.900%, 04/07/14 5,710 5,707
- ------------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT
AGENCY OBLIGATIONS
(Cost $ 40,875) 41,293
==============================================================================
U.S. GOVERNMENT MORTGAGE-BACKED
OBLIGATIONS [43.6%]
FFCB REMIC, Ser 2007-IA2,
Cl 1 (B)
5.220%, 10/21/13 356 356
FFCB REMIC, Ser 2007-IA3,
Cl 1 (B)
5.370%, 09/25/13 2,242 2,262
FFCB REMIC, Ser 2007-IA8,
Cl 1
4.650%, 01/21/14 2,063 2,067
FHLMC REMIC, Ser R002,
Cl AH
4.750%, 07/15/15 1,067 1,097
FHLMC REMIC, Ser R003,
Cl AG
5.125%, 10/15/15 1,358 1,399
FHLMC REMIC, Ser R005,
Cl AB
5.500%, 12/15/18 717 749
FHLMC REMIC, Ser R007,
Cl AC
5.875%, 05/15/16 1,129 1,165
DESCRIPTION FACE AMOUNT(000) VALUE (000)
- ------------------------------------------------------------------------------
FHLMC REMIC, Ser R009,
Cl AK
5.750%, 12/15/18 $ 1,422 $ 1,484
FHLMC REMIC, Ser R010,
Cl AB
5.500%, 12/15/19 3,218 3,357
FHLMC REMIC, Ser R011,
Cl AB
5.500%, 12/15/20 1,412 1,477
FHLMC REMIC, Ser R012,
Cl AB
5.500%, 12/15/20 1,143 1,190
FHLMC REMIC, Ser R013,
Cl AB
6.000%, 12/15/21 1,446 1,510
FHLMC REMIC, Ser R014,
Cl AL
5.500%, 10/15/14 596 610
FHLMC REMIC, Ser R015,
Cl AN
3.750%, 02/15/13 1,934 1,967
FHLMC REMIC, Ser R016,
Cl AM
5.125%, 06/15/18 3,415 3,566
FNMA, Ser 2005-25, Cl VH
5.000%, 04/25/16 4,357 4,620
FNMA ARM (A)
4.545%, 03/01/34 544 565
FNMA REMIC, Ser 2005-119,
Cl DG
5.500%, 01/25/36 322 326
FNMA REMIC, Ser R009,
Cl AJ
5.750%, 12/15/18 2,076 2,170
GNMA
8.000%, 08/15/22 11 13
7.500%, 06/15/24 6 6
7.500%, 05/15/26 5 6
7.500%, 04/15/32 31 35
7.000%, 12/15/16 13 14
6.000%, 01/15/29 13 13
GNMA ARM (A)
4.000%, 08/20/35 134 136
2.625%, 04/20/35 582 586
- --------------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT MORTGAGE
-BACKED OBLIGATIONS
(Cost $31,928) 32,746
==============================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 35
schedule of investments
SEPTEMBER 30, 2009
- ---------------------------------------------------------
GOVERNMENT BOND FUND(CONCLUDED)
DESCRIPTION SHARES VALUE (000)
- ----------------------------------------------------------
CASH EQUIVALENT [0.9%]
Goldman Sachs Financial Square
Funds - Government Fund,
0.080%* 648,488 $ 648
- ----------------------------------------------------------
TOTAL CASH EQUIVALENT
(Cost $648) 648
==========================================================
TOTAL INVESTMENTS [99.5%]
(Cost $73,451) $ 74,687
==========================================================
- ----------
PERCENTAGES ARE BASED ON NET ASSETS $75,075 OF ($ THOUSANDS).
* THE RATE REPORTED IS THE 7-DAY CURRENT YIELD AS OF SEPTEMBER 30, 2009.
(A) FLOATING RATE SECURITY-- THE RATE REFLECTED IS THE RATE IN EFFECT ON
SEPTEMBER 30, 2009.
(B) SECURITY IS FAIR VALUED
ARM -- ADJUSTABLE RATE MORTGAGE
CL -- CLASS
FFCB -- FEDERAL FARM CREDIT BANK
FHLB -- FEDERAL HOME LOAN BANK
FHLMC -- FEDERAL HOME LOAN MORTGAGE CORPORATION
FNMA -- FEDERAL NATIONAL MORTGAGE ASSOCIATION
GNMA -- GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
REMIC -- REAL ESTATE MORTGAGE INVESTMENT CONDUIT
SER -- SERIES
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands):
Investments in Securities Level 1 Level 2 Level 3 Total
------- -------- ------- --------
U.S. Government Agency
Obligations $ -- $ 41,293 $ -- $ 41,293
U.S. Government Mortgage-
Backed Obligations -- 30,128 2,618 32,746
Cash Equivalent 648 -- -- 648
------- -------- ------ --------
Total Investments in Securities $ 648 $ 71,421 $ 2,618 $ 74,687
======= ======== ======= ========
The following is a reconciliation of investments in which significant unob-
servable inputs (Level 3) were used in determining value:
Investments
in
Securities
-----------
Beginning balance as of
October 1, 2008 $ --
Accrued discounts/premiums --
Realized gain/(loss) --
Change in unrealized
appreciation/(depreciation) --
Net purchases/sales --
Net transfer in and/or out
of Level 3 2,618
-----------
Ending balance as of September
30, 2009 $ 2,618
===========
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 36
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT BOND FUND
ISSUER INDUSTRY WEIGHTINGS (UNAUDITED)*:
(BAR CHART)
General Revenue 25.4%
Education 17.1%
Power 11.9%
General Obligation 11.2%
Public Facilities 9.9%
Water 8.7%
Short-Term Investments 4.3%
Transportation 3.4%
Healthcare 3.2%
Industrial Development 3.1%
Housing 1.8%
- ----------
* Percentages based on total investments.
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -----------------------------------------------------------------------
MUNICIPAL BONDS [95.7%]
ARIZONA [2.1%]
Arizona State, School Facilities
Board, Ser C, COP, FSA
Callable 09/01/14 @ 100
5.000%, 09/01/15 $ 750 $ 840
=======================================================================
CALIFORNIA [82.2%]
Antelope Valley, Unified High
School District, Ser A, GO,
NATL-RE
Callable 08/01/12 @ 101
5.000%, 08/01/23 250 262
Azusa, Redevelopment Agency,
Mortgage-Backed Securities
Program, Ser A, RB, ETM (B)
6.875%, 10/01/12 200 234
Banning, Financing Authority,
Election Systems Project,
RB, XLCA
Callable 06/01/17 @ 100
5.000%, 06/01/22 805 825
Bay Area, Infrastructure Financing
Authority, State Payment
Acceleration Project, RB,
NATL-RE FGIC
Callable 08/01/14 @ 100
5.000%, 08/01/17 350 365
Bay Area, Infrastructure Financing
Authority, State Payment
Acceleration Project, RB, XLCA
Callable 08/01/11 @ 100
5.000%, 08/01/14 500 516
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -----------------------------------------------------------------------
Burbank, Public Financing
Authority, Golden State
Redevelopment Project,
Ser A,TA, AMBAC (A)
Pre-Refunded @ 100
5.250%, 12/01/13 $ 75 $ 87
Burbank, Public Financing
Authority, Golden State
Redevelopment Project,
Ser A,TA, AMBAC
Callable 12/01/13 @ 100
5.250%, 12/01/18 100 103
California State, Department
of Water Resources, Power
Supply Project, Ser H, RB, FSA
Callable 05/01/18 @ 100
5.000%, 05/01/21 750 849
California State, Department
of Water Resources,Water
Systems Project, Ser J-2, RB
7.000%, 12/01/12 500 594
California State, Department
of Water Resources,Water
Systems Project, Ser Y, RB,
NATL-RE FGIC
Callable 06/01/13 @ 100
5.250%, 12/01/19 500 552
California State, Economic
Recovery Authority, Ser A,
GO, NATL-RE
Callable 07/01/14 @ 100
5.000%, 07/01/15 500 558
California State, Educational
Facilities Authority, Stanford
University Project, Ser T-4, RB
5.000%, 03/15/14 350 403
California State, GO (A)
Pre-Refunded @ 100
5.250%, 09/01/10 25 26
California State, GO (A)
Pre-Refunded @ 100
5.250%, 09/01/10 10 10
California State, GO (A)
Pre-Refunded @ 100
5.250%, 10/01/10 20 21
California State, GO (A)
Pre-Refunded @ 100
5.000%, 02/01/12 400 439
California State, GO
Callable 02/01/12 @ 100
5.000%, 02/01/18 175 182
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 37
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------
California State, GO
5.500%, 04/01/19 $ 500 $ 577
California State, Infrastructure
& Economic Authority, Bay
Area Toll Bridges Project,
Ser A, RB, FSA (A)
Pre-Refunded @ 100
5.250%, 07/01/13 125 144
California State, Public Works
Board Lease, Department
of Corrections Project,
Ser B, RB, NATL-RE
Callable 11/02/09 @ 100
5.000%, 09/01/21 100 98
California State, Public Works
Board Lease, Department
of Corrections-Administration
Project, Ser A, RB, AMBAC
Callable 03/01/12 @ 100
5.250%, 03/01/18 155 159
California State, Public Works
Board Lease, Department of
Mental Health Project,
Ser A, RB
5.250%, 06/01/13 200 216
California State, Public Works
Board Lease,Various University
Projects, Ser A, RB, NATL-RE
5.500%, 06/01/14 250 269
Carlsbad, Public Financing
Authority, Municipal Golf
Course Project, Ser A, RB,
AMBAC
4.500%, 09/01/16 350 400
Castaic Lake,Water Agency,Water
Systems Improvement Project,
Ser A, COP, NATL-RE
7.000%, 08/01/13 300 358
Corona, Public Financing
Authority, City Hall Project,
Ser B, RB, NATL-RE
Callable 09/01/12 @ 100
5.250%, 09/01/16 350 370
Culver City, Redevelopment
Finance Authority,TA, AMBAC
5.500%, 11/01/14 75 77
Dry Creek, Joint Elementary
School District, Ser A, GO,
FSA (C)
3.000%, 08/01/11 200 193
East Bay, Regional Park District,
GO
5.000%, 09/01/13 250 285
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------
Escondido, Union School
District, Refunding &
Financing Project, COP,
NATL-RE
4.750%, 07/01/19 $ 735 $ 822
Fresno, Unified School District,
Election 2001 Project, Ser D,
GO, NATL-RE
Callable 08/01/13 @ 102
5.000%, 08/01/17 200 221
Gilroy, Unified School District,
GO, NATL-RE FGIC
Callable 08/01/13 @ 100
5.250%, 08/01/19 800 861
Golden State,Tobacco Settlement,
Ser A, RB, AMBAC
Callable 06/01/10 @ 100
5.000%, 06/01/20 500 501
Golden State,Tobacco Settlement,
Ser A-1, RB (A)
Pre-Refunded @ 100
6.750%, 06/01/13 870 1,030
Golden State,Tobacco Settlement,
Ser B, RB (A)
Pre-Refunded @ 100
5.625%, 06/01/13 500 572
Golden State,Tobacco Settlement,
Ser B, RB (A)
Pre-Refunded @ 100
5.500%, 06/01/13 1,000 1,140
Golden State,Tobacco Settlement,
Ser B, RB, FGIC (A)
Pre-Refunded @ 100
5.500%, 06/01/13 100 114
Hawthorne, School District,
COP, FSA (A)
Pre-Refunded @ 101
6.000%, 11/01/10 470 491
Kern, High School District,
GO, ETM
7.100%, 08/01/12 290 339
Los Angeles , Ser A, GO, FSA-CR
MBIA
Callable 09/01/12 @ 100
5.000%, 09/01/20 750 809
Los Angeles County, Metropolitan
Transportation Authority,
Proposition C, Ser A, RB,
NATL-RE
Callable 07/01/14 @ 100
5.000%, 07/01/16 200 223
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 38
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE(000)
- -----------------------------------------------------------------------
Los Angeles County, Sanitation
Districts Financing Authority,
Capital Projects (District #14),
Sub-Ser B, RB, NATL-RE
FGIC
3.750%, 10/01/14 $ 175 $ 186
Los Angeles, Department of
Water & Power, Power Systems
Project, Ser A Sub-Ser-Ser A-1,
RB, NATL-RE
5.000%, 07/01/12 665 737
Los Angeles, Municipal
Improvement Authority,
Central Library Project, Ser A,
RB, NATL-RE
5.250%, 06/01/12 300 328
Los Angeles, Municipal
Improvement Authority,
Central Library Project, Ser A,
RB, NATL-RE
Callable 06/01/12 @ 100
5.500%, 06/01/18 500 530
Los Angeles, Ser A, GO
5.000%, 09/01/15 175 203
Los Angeles, Unified School
District, COP, AMBAC
5.000%, 10/01/12 750 813
Los Angeles, Unified School
District, GO, NATL-RE
5.750%, 07/01/16 500 600
Los Angeles, Unified School
District, Ser A-1, GO, NATL-RE
Callable 07/01/14 @ 100
5.000%, 07/01/17 125 137
Los Angeles,Wastewater Systems
Authority, Ser A, RB
5.000%, 06/01/14 750 861
North Orange County,
Community College District,
Ser A, GO, NATL-RE (A)
Pre-Refunded @ 101
5.375%, 08/01/12 525 593
Northern California, Power
Agency, Hydroelectric Project,
Ser A, RB, NATL-RE
Callable 11/02/09 @ 100
5.125%, 07/01/23 750 756
Northern California,Transmission
Resource Authority, Ore
Transmission Project, Ser A,
RB, NATL-RE
7.000%, 05/01/13 250 271
DESCRIPTION FACE AMOUNT (000) VALUE(000)
- -----------------------------------------------------------------------
Oakley, Civic Center Project,
COP
4.000%, 05/01/12 $ 230 $ 242
Orange County, Public
Financing Authority, RB,
NATL-RE
5.000%, 07/01/17 1,000 1,099
Orange County, Sanitation
District, Ser A, COP
3.000%, 02/01/17 500 517
Oxnard, School District,
Election 2006 Project, Ser A,
GO, CIFG
6.750%, 08/01/11 300 331
Pinole, Redevelopment Agency,
Pinole Vista Redevelopment
Project,TA, FSA
Callable 11/02/09 @ 101
5.250%, 08/01/14 100 101
Redwoods, Community College
District, 2004 Election Project,
Ser A, GO, NATL-RE
Callable 08/01/14 @ 100
5.000%, 08/01/23 420 446
Sacramento, City Financing
Authority, EPA Building
Project, Ser A, RB, AMBAC
Callable 11/02/09 @ 100
4.750%, 05/01/17 525 529
Sacramento, Municipal Utility
District, RB, NATL-RE
Callable 08/15/13 @ 100
5.000%, 08/15/19 500 532
Sacramento, Municipal Utility
District, Ser T, RB, NATL-RE
FGIC
Callable 05/15/14 @ 100
5.250%, 05/15/22 805 859
San Diego, Public Facilities
Financing Authority, Ser B, RB
5.000%, 05/15/14 750 853
San Diego, Unified School
District, Election 1998 Project,
Ser D, GO, FGIC
Callable 07/01/12 @ 100
5.000%, 07/01/27 500 545
San Diego, Unified School
District, Election 1998 Project,
Ser E, GO, FSA
Callable 07/01/13 @ 101
5.250%, 07/01/16 100 113
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 39
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ------------------------------------------------------------------------
San Francisco (City & County),
Public Utilities Commission,
Ser B, RB
5.000%, 11/01/19 $ 750 $ 881
San Francisco, Bay Area Transit
Financing Authority, Ser A,
RB, NATL-RE
Callable 07/01/15 @ 100
5.000%, 07/01/24 550 590
San Jose, Unified School District,
Ser A, GO, FSA
Callable 08/01/11 @ 101
5.375%, 08/01/19 150 160
San Ysidro, School District,
Election 1997 Project, Ser C,
GO, NATL-RE
6.000%, 08/01/11 205 223
Santa Margarita, Dana Point
Authority, Ser A, RB, AMBAC
Callable 08/01/14 @ 100
5.000%, 08/01/15 165 181
Solano County, COP,
NATL-RE (A)
Pre-Refunded @ 100
5.250%, 11/01/12 100 113
Southern California, Metropolitan
Water District Authority,
Ser A, RB
5.750%, 07/01/21 280 338
Southern Kern, Unified School
District, Ser A, GO, NATL-RE
FGIC
Callable 11/01/13 @ 100
4.500%, 11/01/18 220 231
Tamalpais, Unified High School
District, GO, NATL-RE
Callable 08/01/11 @ 101
4.875%, 08/01/17 100 104
University of California, Multiple
Purpose Projects, Ser Q, RB, FSA
Callable 09/01/11 @ 101
5.000%, 09/01/22 500 529
University of California, Ser B,
RB, FSA
Callable 05/15/13 @ 101
5.000%, 05/15/20 750 816
University of California, UCLA
Medical Center Project, Ser B,
RB, AMBAC (A)
Pre-Refunded @ 100
5.500%, 05/15/14 500 587
---------------------------------------------------------------------
TOTAL CALIFORNIA 33,230
=====================================================================
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ------------------------------------------------------------------------
ILLINOIS [0.5%]
Illinois State, Civic Center
Authority, RB, FSA
Callable 12/15/10 @ 100
5.500%, 12/15/14 $ 200 $ 208
=====================================================================
MISSOURI [0.5%]
St Louis, Parking Facilities
Authority, Downtown Parking
Facilities Project, Sub-Ser A,
RB (A)
Pre-Refunded @ 100
6.000%, 02/01/12 200 221
=====================================================================
NEW JERSEY [0.9%]
New Jersey State,Turnpike
Authority, Ser C, RB,
NATL-RE, ETM
6.500%, 01/01/16 315 374
=====================================================================
NEW MEXICO [1.0%]
Santa Fe, Educational Facilities
Authority, College of Santa Fe
Project, RB (A)
Pre-Refunded @ 100
5.750%, 10/01/14 350 415
=====================================================================
NEW YORK [2.6%]
New York City Housing
Development, Ser F, RB
Callable 05/01/11 @ 100
1.950%, 11/01/12 500 500
New York State, Local Assistance
Correction Authority, Ser E, RB
6.000%, 04/01/14 500 564
---------------------------------------------------------------------
TOTAL NEW YORK 1,064
=====================================================================
SOUTH CAROLINA [2.1%]
Columbia,Tourism Development
Fee Pledge Project, COP,
AMBAC
Callable 06/01/13 @ 100
5.250%, 06/01/16 350 379
South Carolina, Jobs & Economic
Development Authority,
Palmetto Health Project,
Ser C, RB (A)
Pre-Refunded @ 100
6.875%, 08/01/13 400 475
---------------------------------------------------------------------
TOTAL SOUTH CAROLINA 854
=====================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 40
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT BOND FUND (CONCLUDED)
DESCRIPTION FACE AMOUNT (000)/SHARES VALUE (000)
- ------------------------------------------------------------------------------
TEXAS [0.3%]
San Angelo,Waterworks & Sewer
System Authority, Refunding
& Improvements Projects, RB,
FSA
Callable 04/01/11 @ 100
5.250%, 04/01/19 $ 100 $ 104
==============================================================================
WASHINGTON [0.9%]
King County, NJB Properties
Project, Ser A, RB
5.000%, 12/01/14 325 374
==============================================================================
WEST VIRGINIA [1.3%]
West Virginia State, Economic
Development Authority,
Correctional Juvenile Project,
Ser A, RB, NATL-RE
Callable 06/01/12 @ 101
5.500%, 06/01/17 500 529
==============================================================================
PUERTO RICO [1.3%]
Puerto Rico Sales Tax Financing,
Sub-Ser A, RB
4.000%, 08/01/16 500 545
- ------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(Cost $37,326) 38,758
==============================================================================
CASH EQUIVALENT [4.3%]
Federated California Municipal
Money Market Fund, Cl I,
0.210%* 1,723,803 1,724
- ------------------------------------------------------------------------------
TOTAL CASH EQUIVALENT
(Cost $1,724) 1,724
==============================================================================
TOTAL INVESTMENTS [100.0%]
(Cost $39,050) $ 40,482
==============================================================================
DESCRIPTION
- ------------------------------------------------------------------------------
PERCENTAGES ARE BASED ON NET ASSETS OF $40,483 ($ THOUSANDS).
* THE RATE REPORTED IS THE 7-DAY CURRENT YIELD AS OF SEPTEMBER 30, 2009.
(A) PRE-REFUNDED SECURITY -- THE MATURITY DATE SHOWN IS THE PRE-REFUNDED DATE.
(B) SECURITIES ARE COLLATERALIZED UNDER AN AGREEMENT FROM FNMA.
(C) FLOATING RATE SECURITY -- THE RATE REFLECTED IS THE RATE IN EFFECT ON
SEPTEMBER 30, 2009.
AMBAC -- AMERICAN MUNICIPAL BOND ASSURANCE COMPANY
CIFG -- CDC IXIS FINANCIAL GUARANTEE
CL -- CLASS
COP -- CERTIFICATE OF PARTICIPATION
ETM -- ESCROW TO MATURITY
FGIC -- FINANCIAL GUARANTEE INSURANCE COMPANY
FNMA -- FEDERAL NATIONAL MORTGAGE ASSOCIATION
FSA -- FINANCIAL SECURITY ASSISTANCE
FSA-CR -- SECURITY IS SECONDARILY GUARANTEED BY FSA
GO -- GENERAL OBLIGATION
MBIA -- MUNICIPAL BOND INSURANCE ASSOCIATION
NATL-RE -- NATIONAL PUBLIC FINANCE GUARANTEE CORPORATION (FORMERLY MBIA-IL)
RB -- REVENUE BOND
SER -- SERIES
TA -- TAX ALLOCATION
XLCA -- XL CAPITAL ASSURANCE
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands):
Investments in Securities Level 1 Level 2 Level 3 Total
------- ------- ------- -------
Municipal Bonds $ -- $38,758 $ -- $38,758
Cash Equivalent 1,724 -- -- 1,724
------- ------- ------- -------
Total Investments in
Securities $ 1,724 $38,758 $ -- $40,482
======= ======= ======= =======
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 41
schedule of investments
September 30, 2009
- --------------------------------------------------------------------------------
HIGH YIELD BOND FUND
(BAR CHART)
ISSUER INDUSTRY WEIGHTINGS (UNAUDITED)*:
Industrials 73.2%
Financials 9.6%
Utilities 8.0%
Telecommunication Services 5.6%
Transportation 2.3%
Common Stock 0.7%
Short-Term Investments 0.6%
Preferred Stock 0.0%
- ----------
* Percentages based on total investments
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -------------------------------------------------------------------
CORPORATE BONDS [95.9%]
Advertising Agencies [0.1%]
Interpublic Group (A)
10.000%, 07/15/17 $ 50 $ 54
===================================================================
AEROSPACE & DEFENSE [1.2%]
Esterline Technologies
7.750%, 06/15/13 100 99
Global Aviation Holdings (A)
14.000%, 08/15/13 150 149
L-3 Communications
5.875%, 01/15/15 200 199
- -------------------------------------------------------------------
TOTAL AEROSPACE & DEFENSE 447
===================================================================
AIRLINES [0.3%]
DAE Aviation Holdings (A)
11.250%, 08/01/15 150 117
===================================================================
AUTO RENT & LEASE [0.9%]
Avis Budget Car Rental
7.750%, 05/15/16 100 87
H&E Equipment Services
8.375%, 07/15/16 100 91
Hertz
10.500%, 01/01/16 150 156
- -------------------------------------------------------------------
TOTAL AUTO RENT & LEASE 334
===================================================================
AUTOMOTIVE [0.2%]
UCI Holdco (B)
9.250%, 12/15/13 202 82
===================================================================
AUTOPARTS [0.5%]
Accuride (C)
8.500%, 02/01/15 150 87
Asbury Automotive Group
7.625%, 03/15/17 100 89
- -------------------------------------------------------------------
TOTAL AUTOPARTS 176
===================================================================
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -------------------------------------------------------------------
BEAUTY PRODUCTS [0.3%]
Chattem
7.000%, 03/01/14 $100 $ 101
===================================================================
BROADCASTING & CABLE [3.2%]
Allbritton Communications
7.750%, 12/15/12 72 68
Atlantic Broadband Finance
9.375%, 01/15/14 100 97
Barrington Broadcasting Group
10.500%, 08/15/14 100 57
Bonten Media Acquisition (A)
9.000%, 06/01/15 157 52
Charter Communications
Holdings II (C)
10.250%, 09/15/10 300 337
CSC Holdings
7.625%, 07/15/18 100 101
Fisher Communications
8.625%, 09/15/14 150 139
Local TV Finance (A)
9.250%, 06/15/15 105 36
Newport Television (A)
13.000%, 03/15/17 107 37
Nexstar Finance Holdings (D)
11.375%, 04/01/13 128 54
Quebecor Media
7.750%, 03/15/16 75 74
Univision Communications (A)
12.000%, 07/01/14 81 87
- -------------------------------------------------------------------
TOTAL BROADCASTING & CABLE 1,139
===================================================================
BUILDING & CONSTRUCTION [1.0%]
Esco (A)
8.625%, 12/15/13 50 49
Interline Brands
8.125%, 06/15/14 50 49
International Utility
Structures (C) (F)
10.750%, 02/01/08 100 1
USG (A)
9.750%, 08/01/14 250 261
- -------------------------------------------------------------------
TOTAL BUILDING & CONSTRUCTION 360
===================================================================
BUSINESS SERVICES [0.5%]
FTI Consulting
7.625%, 06/15/13 50 50
Geo Group
8.250%, 07/15/13 150 152
- -------------------------------------------------------------------
TOTAL BUSINESS SERVICES 202
===================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 42
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
HIGH YIELD BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ------------------------------------------------------------------------------
CHEMICALS [2.1%]
Innophos
8.875%, 08/15/14 $ 100 $ 101
Momentive Performance
Materials
9.750%, 12/01/14 100 78
Nalco
8.875%, 11/15/13 150 154
Nova Chemicals
6.500%, 01/15/12 150 147
Polymer Holdings (D) (E) (F)
18.929%, 07/15/14 250 184
Terra Capital, Ser B
7.000%, 02/01/17 100 104
- ------------------------------------------------------------------------------
TOTAL CHEMICALS 768
==============================================================================
CIRCUIT BOARDS [0.1%]
Viasystems
10.500%, 01/15/11 50 49
==============================================================================
COMMERCIAL SERVICES [1.5%]
ARAMARK
8.500%, 02/01/15 150 151
DI Finance
9.500%, 02/15/13 150 153
Iron Mountain
8.750%, 07/15/18 150 156
Tube City IMS
9.750%, 02/01/15 100 81
- ------------------------------------------------------------------------------
TOTAL COMMERCIAL SERVICES 541
==============================================================================
COMPUTER SYSTEM DESIGN & SERVICES [2.2%]
Activant Solutions
9.500%, 05/01/16 100 89
Compucom Systems (A)
12.500%, 10/01/15 100 93
Stream Global Services (A)
11.250%, 10/01/14 350 334
Terremark Worldwide (A)
12.000%, 06/15/17 200 218
Unisys (A)
14.250%, 09/15/15 32 33
- ------------------------------------------------------------------------------
TOTAL COMPUTER SYSTEM
Design & Services 767
==============================================================================
CONGLOMERATE [0.3%]
KAR Holdings
8.750%, 05/01/14 100 99
==============================================================================
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ------------------------------------------------------------------------------
CONSUMER PRODUCTS & SERVICES [3.4%]
Central Garden & Pet
9.125%, 02/01/13 $ 100 $ 101
Jarden
7.500%, 05/01/17 75 73
Johnsondiversey, Ser B
9.625%, 05/15/12 150 152
Johnsondiversey Holdings (D)
10.670%, 05/15/13 200 192
Libbey Glass (B)
8.260%, 06/01/11 100 90
MSX International (A)
12.500%, 04/01/12 100 45
Sealy Mattress
8.250%, 06/15/14 200 185
Sotheby's
7.750%, 06/15/15 100 86
Southern States Cooperative
(A)
11.000%, 11/01/11 200 200
Steinway Musical Instruments
(A)
7.000%, 03/01/14 100 85
Yankee Acquisition, Ser B
9.750%, 02/15/17 50 46
- ------------------------------------------------------------------------------
TOTAL CONSUMER PRODUCTS & SERVICES 1,255
==============================================================================
CONTAINERS & PACKAGING [1.0%]
Exopack Holding
11.250%, 02/01/14 100 99
Intertape Polymer US (F)
8.500%, 08/01/14 100 77
Solo Cup
8.500%, 02/15/14 200 191
- ------------------------------------------------------------------------------
TOTAL CONTAINERS & PACKAGING 367
==============================================================================
DATA PROCESSING/MGMT [1.0%]
First Data
9.875%, 09/24/15 400 369
==============================================================================
DISTRIBUTION/WHOLESALE [1.0%]
VWR Funding
10.250%, 07/15/15 400 365
==============================================================================
DIVERSIFIED OPERATIONS [0.6%]
Trinity Industries
6.500%, 03/15/14 200 198
==============================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 43
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
HIGH YIELD BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------------
E-COMMERCE/PRODUCTS [0.7%]
Vitamin Shoppe Industries (B)
7.940%, 11/15/12 $ 250 $ 250
=====================================================================
EDUCATIONAL SERVICES [0.3%]
Education Management
8.750%, 06/01/14 100 106
=====================================================================
ELECTRIC UTILITIES [5.1%]
AES
9.375%, 09/15/10 100 103
8.000%, 10/15/17 100 101
8.000%, 06/01/20 50 50
CMS Energy
6.875%, 12/15/15 150 151
CMS Energy
8.750%, 06/15/19 50 54
Edison Mission Energy
7.200%, 05/15/19 150 121
7.000%, 05/15/17 150 125
Energy Future Holdings
10.875%, 11/01/17 465 351
ESI Tractebel Acquisition, Ser B
7.990%, 12/30/11 39 39
KCP&L Greater Missouri
Operations
7.950%, 02/01/11 150 158
Mirant North America
7.375%, 12/31/13 150 149
NRG Energy
7.375%, 02/01/16 100 97
PNM Resources
9.250%, 05/15/15 100 101
RRI Energy
7.625%, 06/15/14 200 196
Sierra Pacific Resources
8.625%, 03/15/14 70 72
- ---------------------------------------------------------------------
TOTAL ELECTRIC UTILITIES 1,868
=====================================================================
ENTERTAINMENT & GAMING [10.0%]
AMC Entertainment
11.000%, 02/01/16 100 107
CCM Merger (A)
8.000%, 08/01/13 175 144
Choctaw Resort Development
Enterprise (A)
7.250%, 11/15/19 182 120
Chukchansi Economic
Development Authority (A)
8.000%, 11/15/13 250 198
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ------------------------------------------------------------------------------
Circus & Eldorado Joint
Venture/Silver Legacy Capital
10.125%, 03/01/12 $ 150 $ 130
Gaylord Entertainment
8.000%, 11/15/13 100 102
Harrah's Operating
10.750%, 02/01/16 250 202
Harrahs Operating Escrow (A)
11.250%, 06/01/17 250 257
Indianapolis Downs & Capital
(A)
11.000%, 11/01/12 100 59
Inn of the Mountain Gods
Resort & Casino (C)
12.000%, 11/15/10 150 69
Isle of Capri Casinos
7.000%, 03/01/14 112 100
Jacobs Entertainment
9.750%, 06/15/14 75 68
Mashantucket Western Pequot
Tribe (A)
8.500%, 11/15/15 170 62
MGM Mirage
8.500%, 09/15/10 200 198
6.750%, 09/01/12 100 84
Mohegan Tribal Gaming
Authority
7.125%, 08/15/14 100 71
Penn National Gaming (A)
8.750%, 08/15/19 250 250
River Rock Entertainment
Authority
9.750%, 11/01/11 300 276
San Pasqual Casino (A)
8.000%, 09/15/13 100 96
Scientific Games
6.250%, 12/15/12 100 97
Seminole Hard Rock
Entertainment (A) (B)
2.799%, 03/15/14 100 80
Seneca Gaming
7.250%, 05/01/12 200 185
Shingle Springs Tribal Gaming
Authority (A)
9.375%, 06/15/15 100 72
Snoqualmie Entertainment
Authority (A) (B)
4.680%, 02/01/14 100 49
Speedway Motorsports
6.750%, 06/01/13 100 99
Tunica-Biloxi Gaming
Authority (A)
9.000%, 11/15/15 125 113
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 44
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
HIGH YIELD BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -------------------------------------------------------------------------
VAIL RESORTS
6.750%, 02/15/14 $ 100 $ 99
Waterford Gaming (A)
8.625%, 09/15/14 77 44
Wynn Las Vegas Capital
6.625%, 12/01/14 175 167
- -------------------------------------------------------------------------
TOTAL ENTERTAINMENT & GAMING 3,598
=========================================================================
Financial Services [1.7%]
GMAC
6.750%, 12/01/14 425 358
Pinnacle Foods Finance
9.250%, 04/01/15 250 254
- -------------------------------------------------------------------------
TOTAL FINANCIAL SERVICES 612
=========================================================================
Food, Beverage & Tobacco [2.1%]
Beverages & More (A)
9.250%, 03/01/12 100 94
Constellation Brands
8.375%, 12/15/14 150 156
Leiner Health Products (C)
11.000%, 06/01/12 100 --
Le-Nature's (A) (C) (F)
9.000%, 06/15/13 150 8
National Beef Packing
10.500%, 08/01/11 100 99
Smithfield Foods (A)
10.000%, 07/15/14 243 255
7.000%, 08/01/11 150 144
- -------------------------------------------------------------------------
TOTAL FOOD, BEVERAGE & TOBACCO 756
=========================================================================
GAS/NATURAL GAS [0.4%]
El Paso
7.000%, 06/15/17 150 147
=========================================================================
HOTELS AND MOTELS [0.4%]
Wyndham Worldwide
6.000%, 12/01/16 150 135
=========================================================================
INSURANCE [2.8%]
National Life Insurance (A)
10.500%, 09/15/39 150 153
Torchmark
9.250%, 06/15/19 550 618
USI Holdings (A) (B)
9.750%, 05/15/15 150 133
4.315%, 11/15/14 125 104
- -------------------------------------------------------------------------
TOTAL INSURANCE 1,008
=========================================================================
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -------------------------------------------------------------------------
INVESTMENT BANKER/BROKER DEALER [1.1%]
Nuveen Investments (A) (F)
10.500%, 11/15/15 $ 450 $ 389
========================================================================
INVESTMENT COMPANIES [0.9%]
Allied Capital (F)
6.625%, 07/15/11 400 329
========================================================================
MACHINERY [3.2%]
Baldor Electric
8.625%, 02/15/17 125 127
Case New Holland (A)
7.750%, 09/01/13 140 139
7.125%, 03/01/14 100 98
CPM Holdings (A)
10.625%, 09/01/14 130 134
Douglas Dynamics (A)
7.750%, 01/15/12 440 379
Terex
7.375%, 01/15/14 100 99
Terex
8.000%, 11/15/17 75 69
Trimas
9.875%, 06/15/12 115 103
- -------------------------------------------------------------------------
TOTAL MACHINERY 1,148
=========================================================================
MEDICAL PRODUCTS & SERVICES [3.5%]
Apria Healthcare Group (A)
12.375%, 11/01/14 150 160
Bausch & Lomb
9.875%, 11/01/15 250 262
Bio-Rad Laboratories
7.500%, 08/15/13 100 102
Community Health Systems
8.875%, 07/15/15 150 154
HCA
9.250%, 11/15/16 50 52
5.750%, 03/15/14 100 88
Omnicare
6.750%, 12/15/13 150 145
Select Medical
7.625%, 02/01/15 186 174
Vanguard Health Holding II
9.000%, 10/01/14 100 102
- -------------------------------------------------------------------------
TOTAL MEDICAL PRODUCTS & SERVICES 1,239
=========================================================================
Metals & Mining [0.7%]
Noranda Aluminium Acquisition (B)
5.413%, 05/15/15 156 109
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 45
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
HIGH YIELD BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT(000) VALUE (000)
- --------------------------------------------------------------------------
Novelis
7.250%, 02/15/15 $ 150 $ 130
- --------------------------------------------------------------------------
TOTAL METALS & MINING 239
==========================================================================
MISCELLANEOUS BUSINESS SERVICES [1.4%]
Affinion Group
11.500%, 10/15/15 100 103
Carriage Services
7.875%, 01/15/15 200 188
Lamar Media
6.625%, 08/15/15 100 91
MCBC Holdings (A)
8.051%, 10/15/14 50 9
Stewart Enterprises
6.250%, 02/15/13 100 97
- --------------------------------------------------------------------------
TOTAL MISCELLANEOUS BUSINESS SERVICES 488
==========================================================================
MISCELLANEOUS MANUFACTURING [3.2%]
AGY Holding
11.000%, 11/15/14 100 80
Altra Industrial Motion
9.000%, 12/01/11 100 102
Buffalo Thunder Development
Authority (A) (C)
9.375%, 12/15/14 75 13
CEVA Group (A)
11.625%, 10/01/16 250 243
Coleman Cable
9.875%, 10/01/12 250 231
Dresser-Rand Group
7.375%, 11/01/14 133 130
General Cable
7.125%, 04/01/17 100 98
Koppers Holdings (D)
15.040%, 11/15/09 250 251
- --------------------------------------------------------------------------
TOTAL MISCELLANEOUS MANUFACTURING 1,148
==========================================================================
PAPER & RELATED PRODUCTS [1.0%]
Appleton Papers, Ser B
9.750%, 06/15/14 100 45
Domtar
7.125%, 08/15/15 150 147
Norampac Industries
6.750%, 06/01/13 100 97
Verso Paper Holdings
9.125%, 08/01/14 100 74
- --------------------------------------------------------------------------
TOTAL PAPER & RELATED PRODUCTS 363
==========================================================================
DESCRIPTION FACE AMOUNT(000) VALUE (000)
- --------------------------------------------------------------------------
PETROLEUM & FUEL PRODUCTS [11.7%]
Atlas Energy Operating
12.125%, 08/01/17 $ 200 $ 216
Atlas Pipeline Partners
8.125%, 12/15/15 200 161
Bill Barrett
9.875%, 07/15/16 250 263
Chesapeake Energy
6.875%, 01/15/16 100 95
Chesapeake Energy
6.250%, 01/15/18 100 90
Cimarex Energy
7.125%, 05/01/17 250 233
Clayton Williams Energy
7.750%, 08/01/13 150 129
Comstock Resources
6.875%, 03/01/12 150 149
Copano Energy
7.750%, 06/01/18 100 95
Dynegy Holdings
7.750%, 06/01/19 100 85
Frontier Oil
6.625%, 10/01/11 150 150
Helix Energy Solutions Group
(A)
9.500%, 01/15/16 100 100
Linn Energy
9.875%, 07/01/18 100 102
MarkWest Energy Partners, Ser B
8.500%, 07/15/16 150 149
McMoRan Exploration
11.875%, 11/15/14 400 400
Newfield Exploration
6.625%, 09/01/14 150 147
Parker Drilling
9.625%, 10/01/13 150 149
Petroplus Finance (A)
7.000%, 05/01/17 150 137
Pioneer Natural Resources
5.875%, 07/15/16 100 92
Plains Exploration & Production
7.750%, 06/15/15 150 149
7.625%, 06/01/18 100 98
Southern Star Central
6.750%, 03/01/16 100 95
Southwestern Energy
7.500%, 02/01/18 100 101
Stone Energy
8.250%, 12/15/11 531 499
Swift Energy
7.625%, 07/15/11 100 99
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 46
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
HIGH YIELD BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -------------------------------------------------------------------------
Tesoro
6.625%, 11/01/15 $ 100 $ 92
Williams Partners
7.250%, 02/01/17 100 98
- -------------------------------------------------------------------------
TOTAL PETROLEUM & FUEL PRODUCTS 4,173
=========================================================================
PRINTING & PUBLISHING [1.2%]
MediMedia USA (A)
11.375%, 11/15/14 50 36
Scholastic
5.000%, 04/15/13 300 257
Sheridan Group
10.250%, 08/15/11 150 126
- -------------------------------------------------------------------------
TOTAL PRINTING & PUBLISHING 419
=========================================================================
RADIO [1.0%]
Cleveland Unlimited (A) (B)
12.000%, 12/15/10 250 247
XM Satellite Radio Holdings (A)
13.000%, 08/01/13 100 98
- -------------------------------------------------------------------------
TOTAL RADIO 345
=========================================================================
REAL ESTATE INVESTMENT TRUSTS [0.7%]
Host Marriott, Ser O
6.375%, 03/15/15 150 142
Ventas Realty
6.500%, 06/01/16 100 97
- -------------------------------------------------------------------------
TOTAL REAL ESTATE INVESTMENT TRUSTS 239
=========================================================================
RESEARCH AND DEVELOPMENT [1.0%]
Catalent Pharma Solutions
9.500%, 04/15/15 400 348
- -------------------------------------------------------------------------
RETAIL [7.3%]
ACE Hardware (A) (F)
9.125%, 06/01/16 100 105
Brunswick (A)
11.250%, 11/01/16 245 267
Claire's Stores
9.625%, 06/01/15 110 66
Dave & Buster's
11.250%, 03/15/14 200 201
Duane Reade (A)
11.750%, 08/01/15 275 289
9.750%, 08/01/11 125 125
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -------------------------------------------------------------------------
Ferrellgas Partners
6.750%, 05/01/14 $ 100 $ 95
Group 1 Automotive
8.250%, 08/15/13 100 99
Inergy
8.250%, 03/01/16 200 201
Landry's Restaurants
14.000%, 08/15/11 300 301
Leslie's Poolmart
7.750%, 02/01/13 175 175
Penske Auto Group
7.750%, 12/15/16 100 92
Rare Restaurant Group (A)
9.250%, 05/15/14 100 64
Sally Holdings
10.500%, 11/15/16 200 208
Sbarro
10.375%, 02/01/15 50 39
Sonic Automotive
8.625%, 08/15/13 70 67
True Temper Sports (C)
8.375%, 09/15/11 150 1
Wendy's (A)
10.000%, 07/15/16 200 212
- -------------------------------------------------------------------------
TOTAL RETAIL 2,607
=========================================================================
RUBBER & PLASTIC [0.5%]
Cooper Tire & Rubber
8.000%, 12/15/19 100 90
Goodyear Tire & Rubber
9.000%, 07/01/15 98 102
- -------------------------------------------------------------------------
TOTAL RUBBER & PLASTIC 192
=========================================================================
SEMI-CONDUCTORS [0.5%]
Amkor Technology
9.250%, 06/01/16 100 103
Sensata Technologies
8.000%, 05/01/14 100 93
- -------------------------------------------------------------------------
TOTAL SEMI-CONDUCTORS 196
=========================================================================
STEEL & STEEL WORKS [0.3%]
Ryerson
12.000%, 11/01/15 75 72
Steel Dynamics
7.375%, 11/01/12 50 51
- -------------------------------------------------------------------------
TOTAL STEEL & STEEL WORKS 123
- -------------------------------------------------------------------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 47
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
HIGH YIELD BOND FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------------------
TELEPHONES & TELECOMMUNICATIONS [7.5%]
Broadview Networks Holdings
11.375%, 09/01/12 $ 100 $ 92
Centennial Communications
10.125%, 06/15/13 100 103
Cincinnati Bell
8.375%, 01/15/14 150 151
Citizens Communications
7.125%, 03/15/19 150 141
Cricket Communications
9.375%, 11/01/14 250 254
Fairpoint Communications
13.125%, 04/02/18 104 13
GeoEye (A)
9.625%, 10/01/15 250 253
MetroPCS Wireless
9.250%, 11/01/14 350 358
Nextel Communications
6.875%, 10/31/13 200 185
Qwest
7.625%, 06/15/15 289 292
Radio One
8.875%, 07/01/11 100 53
Sprint Capital
8.375%, 03/15/12 150 156
Telcordia Technologies (A) (B)
4.259%, 07/15/12 400 345
Time Warner Telecom Holdings
9.250%, 02/15/14 100 103
Virgin Media Finance
9.125%, 08/15/16 150 154
West
11.000%, 10/15/16 50 50
- ---------------------------------------------------------------------------
TOTAL TELEPHONES &
TELECOMMUNICATIONS 2,703
===========================================================================
TRANSPORTATION SERVICES [3.8%]
Delta Airlines (A)
11.750%, 03/15/15 280 261
Kansas City Southern Railway
8.000%, 06/01/15 100 102
Navios Maritime Holdings
9.500%, 12/15/14 100 94
Pegasus Solutions (A)
10.500%, 04/15/15 100 32
Royal Caribbean Cruises
6.875%, 12/01/13 100 93
Ship Finance International
8.500%, 12/15/13 200 191
Stena
7.000%, 12/01/16 150 128
FACE AMOUNT
DESCRIPTION (000)/SHARES VALUE (000)
- ---------------------------------------------------------------------------
Susser Holdings
10.625%, 12/15/13 $ 160 $ 165
Swift Transportation (A) (B)
8.190%, 05/15/15 200 142
Travelport
9.875%, 09/01/14 170 165
- ---------------------------------------------------------------------------
TOTAL TRANSPORTATION SERVICES 1,373
===========================================================================
WASTE DISPOSAL [0.5%]
Waste Services
9.500%, 04/15/14 100 99
WCA Waste
9.250%, 06/15/14 100 96
- ---------------------------------------------------------------------------
TOTAL WASTE DISPOSAL 195
===========================================================================
TOTAL CORPORATE BONDS
(Cost $36,526) 34,526
===========================================================================
COMMON STOCK [0.7%]
BROADCASTING & CABLE [0.0%]
Olympus* (E) (F) 8,500 9
===========================================================================
BUILDING & CONSTRUCTION SUPPLIES [0.0%]
Dayton Superior* 149 --
============================================================================
CHEMICALS [0.6%]
Georgia Gulf* (E) (F) 7,095 212
===========================================================================
IT SERVICES [0.1%]
Unisys* 10,447 28
===========================================================================
PAPER & FOREST PRODUCTS [0.0%]
Tembec* 5,625 5
===========================================================================
TOTAL COMMON STOCK
(Cost $320) 254
===========================================================================
PREFERRED STOCK [0.0%]
CHEMICALS [0.0%]
Georgia Gulf* (E) (F) 317 10
===========================================================================
TOTAL PREFERRED STOCK
(Cost $6) 10
===========================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 48
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
HIGH YIELD BOND FUND (CONCLUDED)
DESCRIPTION FACE AMOUNT(000)/SHARES VALUE (000)
- -------------------------------------------------------------------------------
CONVERTIBLE BONDS [0.5%]
PETROLEUM & FUEL PRODUCTS [0.3%]
Bill Barrett
5.000%, 03/15/28 $ 100 $ 94
==============================================================================
RETAIL [0.2%]
Pantry
3.000%, 11/15/12 100 82
==============================================================================
TOTAL CONVERTIBLE BONDS
(Cost $171) 176
==============================================================================
CASH EQUIVALENTS [0.7%]
Evergreen Select Money
Market Fund, Institutional
Class, 0.130%** 116,357 116
Fidelity Institutional Domestic
Money Market Portfolio,
Cl I, 0.270%** 116,357 117
==============================================================================
TOTAL CASH EQUIVALENTS
(Cost $233) 233
==============================================================================
TOTAL INVESTMENTS [97.8%]
(Cost $37,256) $ 35,199
==============================================================================
- ----------
PERCENTAGES ARE BASED ON NET ASSETS OF $35,992 ($ THOUSANDS).
* NON-INCOME PRODUCING SECURITY.
** THE RATE REPORTED IS THE 7-DAY CURRENT YIELD AS OF SEPTEMBER 30, 2009.
(A) SECURITY EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE SECURITIES ACT OF
1933.THESE SECURITIES MAY BE RESOLD IN TRANSACTIONS EXEMPT FROM
REGISTRATION NORMALLY TO QUALIFIED INSTITUTIONS. ON SEPTEMBER 30, 2009, THE
VALUE OF THESE SECURITIES AMOUNTED TO $8,562(000), REPRESENTING 23.7% OF
THE NET ASSETS OF THE FUND.
(B) FLOATING RATE SECURITY -- THE RATE REFLECTED IS THE RATE IN EFFECT ON
SEPTEMBER 30, 2009.
(C) IN DEFAULT ON INTEREST PAYMENTS. RATE SHOWN REPRESENTS THE LAST COUPON RATE
PRIOR TO DEFAULT.
(D) STEP BOND -- THE RATE REPORTED IS THE RATE IN EFFECT ON SEPTEMBER 30,
2009.THE COUPON ON A STEP BOND CHANGES ON A SPECIFIC DATE.
(E) SECURITY IS FAIR VALUED.
(F) SECURITY IS CONSIDERED ILLIQUID.
CL -- CLASS
MTN -- MEDIUM TERM NOTE
SER -- SERIES
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
- --------------------------------------------------------------------------------
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands):
Investments in
Securities Level 1 Level 2 Level 3 Total
--------- -------- ------- --------
Corporate Bonds $ -- $ 34,333 $ 193 $ 34,526
Common Stock 33 212 9 254
Preferred Stock -- 10 -- 10
Convertible Bonds -- 176 -- 176
Cash Equivalents 233 -- -- 233
--------- -------- ------- --------
Total Investments in
Securities $ 266 $ 34,731 $ 202 $ 35,199
========= ======== ======= ========
The following is a reconciliation of investments in which significant
unobservable inputs (Level 3) were used in determining value.
Investment
in Investments
Corporate in Common
Bonds Stock
($Thousands) ($Thousands)
------------- -------------
Beginning balance as of October 1, $ 145 $ 9
2008
Accrued discounts/premiums 8 --
Realized gain/(loss) -- --
Change in unrealized appreciation/
(depreciation) 31 --
Net purchases/sales -- --
Net transfer in and/or out of
Level 3 9 --
------------- -------------
Ending balance as of September 30,
2009 $ 193 $ 9
============= =============
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 49
SCHEDULE OF INVESTMENTS
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
PRIME MONEY MARKET FUND
TYPE OF SECURITY WEIGHTINGS (UNAUDITED)*:
(BAR CHART)
Commercial Paper 53.9%
Short-Term Investments 24.7%
Certificates of Deposit 12.7%
U.S. Government Agency Obligations 7.7%
Corporate Obligations 1.0%
- ----------
* Percentages are based on total investments.
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------------
COMMERCIAL PAPER (A) [54.0%]
BANKS [20.7%]
Abbey National
North America
0.155%, 10/08/09 $ 25,000 $ 24,999
Allied Irish Banks
North America (B)
0.570%, 10/01/09 25,000 25,000
ANZ National Int'l (B)
0.310%, 01/04/10 25,000 24,979
Bank of Ireland (B)
0.500%, 10/08/09 25,000 24,997
Bank of Nova Scotia
0.220%, 10/16/09 25,000 24,998
BNZ International
Funding (B)
0.300%, 01/20/10 25,000 24,977
Erste Finance Delaware (B)
0.290%, 10/19/09 25,000 24,996
KBC Financial Products
International (B)
0.450%, 10/05/09 25,000 24,999
Korea Development Bank
1.708%, 11/03/09 25,000 24,961
Lloyds TSB Bank
0.190%, 10/09/09 25,000 24,999
Societe Generale
North America
0.451%, 10/02/09 25,000 25,000
Standard Chartered Bank (B)
0.965%, 12/14/09 25,000 24,951
Toronto-Dominion
Holdings USA (B)
0.260%, 01/04/10 25,000 24,983
- --------------------------------------------------------------------
TOTAL BANKS 324,839
====================================================================
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------------
FINANCIAL SERVICES [15.9%]
ASB Finance (B)
0.340%, 01/25/10 $ 25,000 $ 24,973
Commerzbank US Finance
0.541%, 01/15/10 25,000 24,960
Danske (B)
0.250%, 11/30/09 25,000 24,990
General Electric Capital
0.180%, 10/07/09 25,000 24,999
HSBC Finance
0.501%, 11/10/09 25,000 24,986
HVB US Finance (B)
0.250%, 10/14/09 25,000 24,998
Nordea North America
0.290%, 11/30/09 25,000 24,988
Rabobank USA Financial
0.230%, 12/01/09 25,000 24,990
Toyota Financial Services
de Puerto Rico
0.150%, 10/28/09 25,000 24,997
Westpac Securities NZ (B)
0.280%, 01/11/10 25,000 24,980
- --------------------------------------------------------------------
TOTAL FINANCIAL SERVICES 249,861
====================================================================
FOOD, BEVERAGE & TOBACCO [1.6%]
Nestle Capital (B)
0.030%, 10/06/09 25,000 25,000
====================================================================
FOREIGN GOVERNMENTS [1.6%]
Republic of Ireland
International Bond
0.622%, 01/04/10 25,000 24,959
====================================================================
IMPORT/EXPORT [1.6%]
Sumitomo Corp of America
0.631%, 10/15/09 25,000 24,994
====================================================================
INSURANCE [1.6%]
MetLife Short Term
Funding (B)
0.741%, 10/16/09 25,000 24,992
====================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 50
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------
PRIME MONEY MARKET FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ------------------------------------------------------------------------
INVESTMENT BANKER/BROKER DEALER
[3.2%]
Citigroup Funding
0.300%, 10/06/09 $ 25,000 $ 24,999
ING US Funding
0.240%, 12/04/09 25,000 24,989
- ------------------------------------------------------------------------
TOTAL INVESTMENT BANKER/
BROKER DEALER 49,988
========================================================================
MACHINERY [1.4%]
John Deere Credit (B)
0.130%, 10/15/09 23,000 22,999
========================================================================
PETROLEUM & FUEL PRODUCTS [1.6%]
ConocoPhillips Qatar
Funding (B)
0.300%, 10/08/09 25,000 24,999
========================================================================
SOVEREIGN AGENCY [3.2%]
Banque et Caisse
d'Epargne de L'Etat
0.280%, 12/15/09 25,000 24,985
Caisse d'Amortissement
de la Dette Sociale
0.300%, 02/05/10 25,000 24,974
- ------------------------------------------------------------------------
TOTAL SOVEREIGN AGENCY 49,959
========================================================================
SPECIAL PURPOSE BANKS [1.6%]
Dexia Delaware
0.280%, 10/08/09 25,000 24,999
========================================================================
TOTAL COMMERCIAL PAPER
(Cost $847,589) 847,589
========================================================================
U.S.GOVERNMENT AGENCY OBLIGATIONS
[7.6%]
FFCB
0.540%, 09/15/10 25,000 25,000
FHLB (C)
0.500%, 12/15/09 10,000 10,000
3.875%, 01/15/10 25,000 25,252
FHLB DN (D)
0.421%, 10/14/09 25,000 24,996
0.550%, 06/04/10 10,000 10,000
FHLMC DN (D)
0.401%, 03/16/10 25,000 24,954
- ------------------------------------------------------------------------
TOTAL U.S. GOVERNMENT
AGENCY OBLIGATIONS
(Cost $120,202) 120,202
========================================================================
DESCRIPTION FACE AMOUNT
(000)/SHARES VALUE (000)
- ------------------------------------------------------------------------
CORPORATE OBLIGATION [1.0%]
BANKS [1.0%]
Wells Fargo
4.200%, 01/15/10 $ 16,000 $ 16,175
========================================================================
TOTAL CORPORATE OBLIGATION
(Cost $16,175) 16,175
========================================================================
CERTIFICATES OF DEPOSIT [12.7%]
BANKS [12.7%]
Banco Bilbao Vizcaya
Argentaria
0.605%, 12/16/09 25,000 25,000
Barclays Bank
0.950%, 11/04/09 25,000 25,000
BNP Paribas NY
0.260%, 01/19/10 25,000 25,000
DnB Bank
0.270%, 10/23/09 25,000 25,000
National Australia Bank
0.280%, 10/08/09 25,000 25,000
Natixis NY
0.400%, 11/12/09 25,000 25,000
Norinchukin Bank-
New York
0.450%, 11/02/09 25,000 25,000
Royal Bank of Scotland
0.230%, 10/29/09 25,000 25,000
- ------------------------------------------------------------------------
TOTAL BANKS 200,000
========================================================================
TOTAL CERTIFICATES OF DEPOSIT
(Cost $200,000) 200,000
========================================================================
CASH EQUIVALENT [0.1%]
Goldman Sachs Financial
Square Funds - Government
Fund, 0.080%* 1,140,705 1,141
- ------------------------------------------------------------------------
TOTAL CASH EQUIVALENT
(Cost $1,141) 1,141
========================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 51
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
PRIME MONEY MARKET FUND (CONCLUDED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ----------------------------------------------------------------------
REPURCHASE AGREEMENTS (E) [24.6%]
Barclays
0.050%, dated 09/30/09,
repurchased on 10/01/09,
repurchase price $137,600,191
(collateralized by a U.S.
Treasury Note, par value
$140,022,216, 1.125%,
1/15/12; with total market
value $140,352,051) $137,600 $ 137,600
Banc of America
0.040%, dated 09/30/09,
repurchased on 10/01/09,
repurchase price
$125,000,139 (collateralized
by U.S. Government
obligations, ranging in par
value $4,661,000- $45,445,000,
1.250%-4.375%, 9/29/11-
7/17/15; with total market
value $127,500,821) 125,000 125,000
Deutsche Bank
0.060%, dated 09/30/09,
repurchased on 10/01/09,
repurchase price $100,000,167
(collateralized by U.S.
Government obligations,
ranging in par value
$3,643,000-$68,602,000,
0.000%-5.000%, 11/13/09-
9/16/14; with total market
value $102,000,137) 100,000 100,000
JPMorgan Chase
0.040%, dated 09/30/09,
repurchased on 10/01/09,
repurchase price $25,000,028
(collateralized by U.S.
Government obligations,
ranging in par value
$35,000-$23,945,000,
0.000%-3.875%, 7/15/11-
5/28/24; with total market
value $25,503,667) 25,000 25,000
- ----------------------------------------------------------------------
TOTAL REPURCHASE AGREEMENTS
(Cost$ 387,600) 387,600
======================================================================
TOTAL INVESTMENTS [100.0%]
(Cost$ 1,572,707) $ 1,572,707
======================================================================
- ----------
PERCENTAGES ARE BASED ON NET ASSETS OF $1,572,857 ($ THOUSANDS).
* THE RATE REPORTED IS THE 7-DAY CURRENT YIELD AS OF SEPTEMBER 30, 2009.
(A) THE RATE REPORTED IS THE EFFECTIVE YIELD AT TIME OF PURCHASE.
(B) SECURITY EXEMPT FROM REGISTRATION UNDER RULE 144A OF THE SECURITIES ACT OF
1933.THESE SECURITIES MAY BE RESOLD IN TRANSACTIONS EXEMPT FROM
REGISTRATION NORMALLY TO QUALIFIED INSTITUTIONS. ON SEPTEMBER 30, 2009, THE
VALUE OF THESE SECURITIES AMOUNTED TO $397,813 (000), REPRESENTING 25.3% OF
THE NET ASSETS OF THE FUND.
(C) ZERO COUPON SECURITY -- THE RATE REPORTED IS THE EFFECTIVE YIELD AT TIME OF
PURCHASE.
(D) FLOATING RATE SECURITY -- THE RATE REPORTED IS THE RATE IN EFFECT ON
SEPTEMBER 30, 2009.
(E) TRI-PARTY REPURCHASE AGREEMENT
DN -- DISCOUNT NOTE
FFCB -- FEDERAL FARM CREDIT BANK
FHLB -- FEDERAL HOME LOAN BANK
FHLMC -- FEDERAL HOME LOAN MORTGAGE CORPORATION
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands):
Investments in Securities Level 1 Level 2 Level 3 Total
------- ---------- ------- --------
Commercial Paper $ -- $ 847,589 $ -- $ 847,589
U.S. Government Agency
Obligations -- 120,202 -- 120,202
Corporate Obligation -- 16,175 -- 16,175
Certificates of Deposit -- 200,000 -- 200,000
Cash Equivalent 1,141 -- -- 1,141
Repurchase Agreements -- 387,600 -- 387,600
------- ---------- ------- ----------
Total Investments in
Securities $ 1,141 $1,571,566 $ -- $1,572,707
======= ========== ======= ==========
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 52
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
GOVERNMENT MONEY MARKET FUND
TYPE OF SECURITY WEIGHTINGS (UNAUDITED)*:
(BAR CHART)
U.S. Government Agency Obligations 69.8%
Repurchase Agreements 28.5%
U.S. Treasury Obligation 1.7%
- ----------
* Percentages are based on total investments.
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ------------------------------------------------------------------
U.S.GOVERNMENT AGENCY
OBLIGATIONS [70.9%]
FARMER MAC DN (A)
0.200%, 10/07/09 $ 50,000 $ 50,000
FFCB
0.500%, 10/07/10 50,000 50,000
0.601%, 12/09/10 (B) 50,000 50,178
FHLB
5.000%, 10/02/09 50,000 50,006
0.500%, 11/05/09 (D) 25,000 25,000
0.450%, 11/24/09 25,000 25,002
0.293%, 12/02/09 (B) 25,000 25,011
0.119%, 12/11/09 (B) 25,000 25,021
0.580%, 12/14/09 30,180 30,200
0.166%, 12/28/09 (B) 25,000 24,999
3.100%, 02/04/10 25,000 25,234
0.790%, 03/11/10 (B) 25,000 25,068
0.875%, 04/15/10 25,000 25,000
0.500%, 05/26/10 25,000 24,986
0.380%, 06/15/10 40,700 40,700
0.560%, 06/22/10 25,000 24,998
0.338%, 07/06/10 (B) 50,000 49,999
0.600%, 07/26/10 10,950 10,950
0.625%, 07/29/10 25,000 25,000
0.550%, 07/30/10 20,000 20,000
0.500%, 09/29/10 40,000 40,000
FHLB DN (A)
0.100%, 10/01/09 200,000 200,000
0.128%, 10/02/09 210,000 209,999
0.198%, 10/09/09 100,000 99,996
0.050%, 10/13/09 50,000 49,999
0.421%, 10/14/09 50,000 49,992
0.320%, 10/19/09 25,000 24,996
0.321%, 10/23/09 50,000 49,990
0.300%, 10/28/09 25,000 24,994
0.260%, 11/18/09 25,000 24,991
1.010%, 02/23/10 25,000 24,899
0.550%, 06/04/10 20,000 20,000
FHLMC
4.125%, 11/30/09 33,182 33,393
3.125%, 02/04/10 25,000 25,175
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ------------------------------------------------------------------
FHLMC DN (A)
0.078%, 10/05/09 $ 150,000 $ 149,999
0.220%, 10/13/09 51,200 51,196
0.230%, 11/09/09 25,000 24,994
0.190%, 12/15/09 50,000 49,980
0.294%, 01/04/10 75,000 74,942
0.502%, 01/06/10 25,000 24,966
0.210%, 01/20/10 50,000 49,968
FNMA
0.404%, 02/12/10 (B) 25,000 25,031
7.125%, 06/15/10 24,866 26,038
FNMA DN (A)
0.170%, 10/01/09 100,000 100,000
0.381%, 09/01/10 25,000 24,912
- ------------------------------------------------------------------
TOTAL U.S. GOVERNMENT
AGENCY OBLIGATIONS
(Cost $2,107,802) 2,107,802
==================================================================
U.S.TREASURY OBLIGATION [1.7%]
U.S.Treasury Note
4.625%, 11/15/09 50,000 50,260
- ------------------------------------------------------------------
TOTAL U.S.TREASURY
OBLIGATION
(Cost $50,260) 50,260
==================================================================
REPURCHASE AGREEMENTS (C) [29.0%]
Bank of America
0.040%, dated 09/30/09,
repurchased on 10/01/09,
repurchase price $375,000,411
(collateralized by U.S.
Government obligations,
ranging in par value
$22,380,000-$104,714,000,
0.000%-5.375%, 3/24/10-
4/15/42; with total market
value $382,500,735) 375,000 375,000
Barclays
0.050%, dated 09/30/09,
repurchased on 10/01/09,
repurchase
price $185,700,258
(collateralized by a U.S.
Treasury Note, par value
$187,999, 2.000%,
11/30/13;
with total market value
$189,414,006) 185,700 185,700
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 53
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
GOVERNMENT MONEY MARKET FUND (CONCLUDED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ---------------------------------------------------------------------
Deutsche Bank
0.060%, dated 09/30/09,
repurchased on 10/01/09,
repurchase price $150,000,250
(collateralized by U.S.
Government obligations,
ranging in par value
$5,724,000-$80,000,000,
0.000%-6.625%, 1/15/10-
5/06/24;with total
market
value $153,000,236) $ 150,000 $ 150,000
UBS Warburg
0.060%, dated 09/30/09,
repurchased on 10/01/09,
repurchase price $100,000,167
(collateralized by a Fannie
Mae Note, par value
$102,015,000, 0.000%,
12/29/09; with total
market value $102,004,797) 100,000 100,000
JPMorgan Chase
0.040%, dated 09/30/09,
repurchased on 10/01/09,
repurchase price $50,000,056
(collateralized by U.S.
Government obligations,
ranging in par value $51,000-
$37,085,000, 0.000%-3.250%,
1/13/16-1/15/30; with total
market value $51,001,759) 50,000 50,000
- ---------------------------------------------------------------------
TOTAL REPURCHASE
AGREEMENTS
(Cost $860,700) 860,700
=====================================================================
TOTAL INVESTMENTS [101.6%]
(Cost $3,018,762) $3,018,762
=====================================================================
PERCENTAGES ARE BASED ON NET ASSETS OF $2,971,852 ($ THOUSANDS).
- ----------
(A) ZERO COUPON SECURITY -- THE RATE REPORTED IS THE EFFECTIVE YIELD AT TIME
OF PURCHASE.
(B) FLOATING RATE SECURITY--THE RATE REFLECTED IS THE RATE IN EFFECT ON
SEPTEMBER 30, 2009.
(C) TRI-PARTY REPURCHASE AGREEMENT
(D) STEP BOND -- THE RATE REFLECTED IS THE RATE IN EFFECT ON SEPTEMBER 30, 2009.
THE COUPON ON A STEP BOND CHANGES ON A SPECIFIC DATE.
DN -- DISCOUNT NOTE
FARMER MAC -- FEDERAL AGRICULTURAL MORTGAGE CORPORATION
FFCB -- FEDERAL FARM CREDIT BANK
FHLB -- FEDERAL HOME LOAN BANK
FHLMC -- FEDERAL HOME LOAN MORTGAGE CORPORATION
FNMA -- FEDERAL NATIONAL MORTGAGE ASSOCIATION
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands):
Investments in Securities Level 1 Level 2 Level 3 Total
------- ----------- ------- ----------
U.S. Government Agency
Obligations $ -- $ 2,107,802 $ -- $2,107,802
U.S.Treasury Obligation 50,260 -- 50,260
Repurchase Agreements -- 860,700 -- 860,700
------- ----------- ------- ----------
Total Investments in
Securities $ -- $ 3,018,762 $ -- $3,018,762
======= =========== ======= ==========
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 54
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT MONEY MARKET FUND
ISSUER INDUSTRY WEIGHTINGS (UNAUDITED)*:
(BAR CHART)
General Revenue 35.2%
Water 17.4%
General Obligation 13.5%
Education 13.1%
Power 9.2%
Public Facilities 3.3%
Healthcare 2.7%
Transportation 2.0%
Commercial Paper 1.4%
Industrial Development 0.9%
Nursing Homes 0.8%
Utilities 0.5%
- ----------
* Percentages based on total investments.
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------
MUNICIPAL BONDS [98.3%]
CALIFORNIA [92.4%]
ABAG, Finance Authority for
Non-Profit Corporations,
Public Policy Institute,
Ser A, RB (A) (B) (C)
0.370%, 10/01/09 $ 2,870 $ 2,870
ABAG, Finance Authority for
Non-Profit Corporations,
Ser C, COP (A) (B) (C)
0.250%, 10/01/09 7,420 7,420
ABAG, Finance Authority for
Non-Profit Corporations,
Ser D, COP (A) (B) (C)
0.250%, 10/01/09 5,970 5,970
Bay Area Toll Authority,
RB (A) (C)
0.300%, 10/01/09 11,000 11,000
Bay Area Toll Authority,
Ser E-1, RB (A) (C)
0.350%, 10/01/09 3,560 3,560
Bay Area Toll Authority,
Ser E-3, RB (A) (C)
0.370%, 10/01/09 4,000 4,000
California State, Daily
Kindergarten
University Project,
Ser A-3, GO (A) (B) (C)
0.330%, 10/01/09 4,735 4,735
California State, Daily
Kindergarten
University Project,
Ser A-4, GO (A) (B) (C)
0.330%, 10/01/09 1,250 1,250
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------
California State, Daily
Kindergarten
University Project,
Ser B-3, GO (A) (B) (C)
0.280%, 10/01/09 $ 4,320 $ 4,320
California State,
Department of Water
Resource & Power,
Ser B-2, RB (A) (B) (C)
0.270%, 10/01/09 15,000 15,000
California State,
Department of Water
Resource & Power,
Ser C-15, RB (A) (B) (C)
0.250%, 10/01/09 5,000 5,000
California State,
Department of Water
Resource & Power,
Ser C-7, RB, FSA (A) (C)
0.450%, 10/01/09 11,425 11,425
California State,
Department of Water
Resource & Power,
Sub-Ser F-2, RB (A) (B) (C)
0.300%, 10/01/09 17,000 17,000
California State,
Department of Water
Resource & Power,
Sub-Ser G-3, RB, FSA (A) (C)
0.450%, 10/01/09 10,000 10,000
California State,
Economic Development
Financing Authority,
KQED Incorporated
Project, RB (A) (B) (C)
0.250%, 10/07/09 1,140 1,140
California State,
Economic Recovery
Authority, Ser C-11,
GO (A) (B) (C)
0.280%, 10/07/09 10,000 10,000
California State,
Educational Facilities
Authority, Pitzer
College Project,
Ser B, RB (A) (B) (C)
0.280%, 10/01/09 3,215 3,215
California State,
Educational Facilities
Authority, Stanford
University Project,
Ser L-4, RB (C)
0.250%, 10/07/09 515 515
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 55
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT MONEY MARKET FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ------------------------------------------------------------------
California State,
Educational Facilities
Authority, University
of San Francisco
Project, RB (A)(B)(C)
0.400%, 10/07/09 $ 4,800 $ 4,800
California State, Health
Facilities Financing
Authority, Luvile
Salter Project, Ser B,
RB (A) (C)
0.350%, 10/01/09 11,700 11,700
California State,
Infrastructure &
Economic Authority,
California Academy
Project, Ser A, RB (A)
(B) (C)
0.270%, 10/01/09 9,900 9,900
California State,
Infrastructure &
Economic Authority,J
Paul Getty Trust
Project, Ser A-2, RB (C)
0.500%, 10/071/09 4,000 4,000
California State,
Infrastructure &
Economic Authority,J
Paul Getty Trust
Project, Ser B, RB (A) (C)
0.250%, 10/01/09 7,820 7,820
California State,
Infrastructure &
Economic Authority,J
Paul Getty Trust
Project, Ser D, RB (A) (C)
0.250%, 10/01/09 3,700 3,700
California State,
Infrastructure &
Economic Authority,
Orange County
Performing Project,
Ser C, RB (A) (B) (C)
0.400%, 10/01/09 5,855 5,855
California State, Ser
A-1, GO (A) (B) (C)
0.330%, 10/01/09 8,350 8,350
California State, Ser
A-3, GO (A) (B) (C)
0.280%, 10/01/09 10,500 10,500
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- ------------------------------------------------------------------
California State, Ser B,
Sub-Ser B-7, GO (A)
(B) (C)
0.390%, 10/01/09 $ 14,275 $ 14,275
California State, Ser B-1,
GO (A) (B) (C)
0.230%, 10/07/09 7,000 7,000
California State, Ser B-4,
GO (A) (B) (C)
0.230%, 10/07/09 4,000 4,000
California State, Ser C-2,
GO (A) (B) (C)
0.370%, 10/01/09 7,700 7,700
California State, Sub-Ser
B-3, GO (A) (B) (C)
0.230%, 10/07/09 3,145 3,145
California State, Sub-Ser
B-4, GO (A) (B) (C)
0.300%, 10/07/09 6,880 6,880
California State,Weekly
Kindergarten
University Project,
Ser A-7, GO (A) (B) (C)
0.250%, 10/01/09 3,195 3,195
California State,Weekly
Kindergarten
University Project,
Ser A-8, GO (A) (B) (C)
0.250%, 10/01/09 25,600 25,600
California State,Weekly
Kindergarten
University Project,
Ser B-5, GO (A) (B) (C)
0.300%, 10/01/09 12,725 12,725
California Statewide,
Communities
Development Authority,
Masters College
Project, RB (A) (B) (C)
0.170%, 10/01/09 3,000 3,000
California Statewide,
Communities
Development Authority,
Park Century School
Project, RB (A) (B) (C)
0.270%, 10/01/09 4,000 4,000
Contra Costa,
Transportation
Authority, RB
2.500%, 10/01/10 4,200 4,284
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 56
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT MONEY MARKET FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -------------------------------------------------------------------
East Bay, Municipal
Utilities District
Water Authority, Sub-Ser
A-1, RB (A) (C)
0.250%, 10/07/09 $ 10,000 $ 10,000
East Bay, Municipal
Utilities District
Water Authority, Sub-Ser
A-2, RB (A) (C)
0.400%, 10/07/09 4,395 4,395
East Bay, Municipal
Utilities District
Water Authority, Sub-Ser
A-3, RB (A) (C)
0.400%, 10/07/09 10,000 10,000
Glendale, Police
Building Project, COP
(A) (C)
0.350%, 10/01/09 18,300 18,300
Irvine, Improvement
Board, Act 1915
Project, District #03-19,
Ser A, SAB (A) (B) (C)
0.270%, 10/01/09 12,040 12,040
Irvine, Improvement
Board, Act 1915
Project, District #04-20,
Ser A, SAB (A) (B) (C)
0.270%, 10/01/09 8,560 8,560
Irvine, Improvement
Board, Act 1915 Project,
District #04-20,
Ser B, RB (A) (B) (C)
0.270%, 10/01/09 15,843 15,843
Irvine, Improvement
Board, Act 1915
Project, District #05-21,
Ser A, SAB (A) (B) (C)
0.330%, 10/01/09 10,430 10,430
Irvine, Improvement
Board, Act 1915
Project, District #07-22,
Ser A, RB (A) (B) (C)
0.270%, 10/01/09 13,950 13,950
Irvine, Improvement
Board, Act 1915
Project, District #97-17,
SAB (A) (B) (C)
0.270%, 10/01/09 7,150 7,150
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- -------------------------------------------------------------------
Los Angeles County,
Metropolitan
Transportation Authority,
Ser A1, RB (A) (C)
0.250%, 10/01/09 $ 6,500 $ 6,500
Los Angeles County,
Metropolitan
Transportation Authority,
Ser A1, RB (A) (C)
0.280%, 10/01/09 27,745 27,745
Los Angeles County,
Metropolitan
Transportation Authority,
Ser C4, RB (A) (B) (C)
0.300%, 10/01/09 2,000 2,000
Los Angeles County,
Ser A,TRAN
2.500%, 10/01/09 7,000 7,088
Los Angeles County,
Ser A,TRAN
2.500%, 10/01/09 7,000 7,085
Los Angeles, Department
of Water & Power, Sub-Ser
B-1, RB (A) (C)
0.300%, 10/01/09 7,000 7,000
Los Angeles, Department
of Water & Power, Sub-Ser
B-2, RB (A) (C)
0.280%, 10/01/09 21,500 21,500
Los Angeles, Department
of Water & Power, Sub-Ser
B-4, RB (A) (C)
0.300%, 10/01/09 1,000 1,000
Los Angeles, Unified
School District,
Ser B, COP (A) (B) (C)
0.250%, 10/07/09 9,300 9,300
Los Angeles, Unified
School District,
Ser D, GO, FGIC
Pre-Refunded @ 100 (D)
5.375%, 07/01/10 6,000 6,222
Los Angeles, Unified
School District,TRAN
2.000%, 08/12/10 10,000 10,118
Los Angeles,Wastewater
Systems Authority,
Sub-Ser C, RB (A) (B) (C)
0.300%, 10/01/09 2,500 2,500
Los Angeles,Wastewater
Systems Authority,
Sub-Ser F-2, RB (A) (B) (C)
0.270%, 10/01/09 7,000 7,000
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 57
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT MONEY MARKET FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------------
Los Angeles,Water &
Power Resource
Authority, Sub-Ser B-1,
RB (A) (C)
0.300%, 07/01/34 $ 4,000 $ 4,000
Los Angeles,Water &
Power Resource
Authority, Sub-Ser B-2,
RB (A) (C)
0.300%, 10/01/09 12,600 12,600
Los Angeles,Water &
Power Resource
Authority, Sub-Ser B-3,
RB (A) (C)
0.300%, 10/01/09 26,400 26,400
Los Angeles,Water &
Power Resource
Authority, Sub-Ser B-6,
RB (A) (C)
0.250%, 10/01/09 10,000 10,000
Oakland-Alameda County,
Coliseum Project,
Ser C-1, RB (A) (B) (C)
0.310%, 10/07/09 15,000 15,000
Orange County, Sanitation
District Authority,
Ser A, COP (A) (C)
0.400%, 10/01/09 13,730 13,730
Orange County,
Sanitation District
Authority, Ser A,TRAN
2.000%, 06/30/10 7,000 7,083
Orange County,
Sanitation District
Authority, Ser B, COP
(A) (C)
0.400%, 10/01/09 27,205 27,205
Orange County,Water
District Authority,
Ser A, COP (A) (C)
0.200%, 10/07/09 2,800 2,800
Pasadena, Public
Financing Authority,
Rose Bowl Refinancing
& Improvement Project,
RB (A) (B) (C)
0.230%, 10/07/09 16,525 16,525
Riverside County, Public
Facilities Authority,
Ser C, COP (A) (B) (C)
0.250%, 10/07/09 12,300 12,300
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------------
Riverside,Water Authority,
Ser A, RB (A) (C)
0.270%, 10/01/09 $ 8,305 $ 8,305
Sacramento County,
Sanitation District
Authority, Sub-Ser B, RB
(A) (B) (C)
0.280%, 10/01/09 2,000 2,000
Sacramento County,
Sanitation District
Authority, Sub-Ser E, RB
(A) (B) (C)
0.230%, 10/07/09 6,500 6,500
San Diego County,
Regional Transportation
Commission,
Ser B, RB (A) (C)
0.300%, 10/01/09 13,350 13,350
San Diego County,
Regional Transportation
Commission,
Ser C, RB (A) (C)
0.350%, 10/01/09 4,900 4,900
San Diego County,
School District, Ser A,TRAN
2.000%, 06/30/10 11,000 11,133
San Diego, Unified School
District,TRAN
2.000%, 07/08/10 9,075 9,177
San Jose, Redevelopment
Agency, Merged Area
Redevelopment Project,
Ser A, RB (A) (B) (C)
0.210%, 10/07/09 7,150 7,150
Santa Barbara County,
Ser A,TRAN
2.500%, 06/30/10 5,715 5,807
Santa Clara County,
Financing Authority,
Multiple Facilities Projects,
Ser M, RB (A) (B) (C)
0.250%, 10/07/09 17,105 17,105
Santa Clara County,
Financing Authority,
VMC Facility
Replacement Project,
Ser B, RB (A) (C)
0.300%, 10/07/09 13,475 13,475
Santa Clara Valley,
Transportation Authority,
Ser C, RB (A) (C)
0.300%, 10/01/09 8,000 8,000
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 58
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT MONEY MARKET FUND (CONTINUED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------------
Santa Clara Valley,
Transportation Authority,
Ser D, RB (A) (C)
0.350%, 10/01/09 $ 6,000 $ 6,000
Santa Clara, Electric
Authority, Sub-Ser B, RB
(A) (B) (C)
0.300%, 10/07/09 4,975 4,975
Santa Cruz County,TRAN
2.000%, 07/08/10 5,000 5,057
Southern California,
Metropolitan Water
District Authority,
Ser A-1, RB (A) (C)
0.250%, 10/01/09 500 500
Southern California,
Metropolitan Water
District Authority,
Ser C-1, RB (A) (C)
0.250%, 10/01/09 7,500 7,500
Southern California,
Metropolitan Water
District Authority,
Water Works Authorization
Project, Ser B, RB (A) (C)
0.300%, 10/01/09 10,135 10,135
Southern California,
Metropolitan Water
District Authority,
Ser B-3, RB (A) (C)
0.250%, 10/01/09 4,000 4,000
Southern California,
Metropolitan Water
District Authority,
Ser C-2, RB (A) (C)
0.210%, 10/01/09 20,720 20,720
Turlock, Irrigation
District, Capital
Improvement & Refunding
Project, COP (A) (B) (C)
0.270%, 10/01/09 6,070 6,070
Turlock, Irrigation
District, First Priority
Project, RB
1.500%, 10/01/09 10,000 10,065
Tustin, Improvement
Board Act,
Reassessment District
No. 95-2-A,
Ser A, SAB (A) (B) (C)
0.280%, 10/01/09 8,685 8,685
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------------
University of
California, Regents
Medical Center,
Ser B-1, RB (A) (C)
0.300%, 10/01/09 $ 6,340 $ 6,340
- --------------------------------------------------------------------------------
TOTAL CALIFORNIA 851,167
================================================================================
CONNECTICUT [1.8 %]
Connecticut State,
Health & Educational
Facility Authority,
Yale University Project,
Ser U2, RB (A) (C)
0.230%, 10/07/09 10,000 10,000
Connecticut State,
Health & Educational
Facility Authority,
Yale University Project,
Ser X-2, RB (A) (C)
0.300%, 10/01/09 6,000 6,000
- --------------------------------------------------------------------------------
TOTAL CONNECTICUT 16,000
================================================================================
MASSACHUSETTS [0.6 %]
Massachusetts State,
Development Finance
Agency, Harvard
University Project,
Ser HH, RB (A) (C)
0.350%, 10/01/09 5,950 5,950
================================================================================
TEXAS [3.0 %]
University of Texas,
Ser A, RB (A) (C)
0.230%, 10/07/09 3,795 3,795
University of Texas,
Ser B, RB (A) (C)
0.250%, 10/01/09 23,500 23,500
- --------------------------------------------------------------------------------
TOTAL TEXAS 27,295
================================================================================
VIRGINIA [0.5 %]
University of Virginia,
Ser A, RB (A) (C)
0.230%, 10/07/09 4,965 4,965
- --------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS
(Cost $905,377) 905,377
================================================================================
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 59
schedule of investments
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT MONEY MARKET FUND (CONCLUDED)
DESCRIPTION FACE AMOUNT (000) VALUE (000)
- --------------------------------------------------------------------------------
COMMERCIAL PAPER [1.4%]
CALIFORNIA [1.4%]
Contra Costa,Water
District Authority
0.250%, 10/05/09 $ 12,700 $ 12,700
- --------------------------------------------------------------------------------
TOTAL COMMERCIAL PAPER
(Cost $12,700) 12,700
================================================================================
TOTAL INVESTMENTS [99.7 %]
(Cost $918,077) $ 918,077
================================================================================
- ----------
PERCENTAGES ARE BASED ON NET ASSETS OF $920,815 ($ THOUSANDS).
(A) SECURITIES ARE HELD IN CONJUNCTION WITH A LETTER OF CREDIT FROM A MAJOR
BANK OR FINANCIAL INSTITUTION.
(B) FLOATING RATE SECURITY -- THE RATE REFLECTED IS THE RATE IN EFFECT ON
SEPTEMBER 30, 2009.
(C) PUT AND DEMAND FEATURE -- THE DATE REPORTED IS THE NEXT RESET DATE.
(D) PREREFUNDED SECURITY -- THE MATURITY DATE SHOWN IS THE PREREFUNDED DATE.
ABAG -- ASSOCIATION OF BAY AREA GOVERNMENTS
COP -- CERTIFICATE OF PARTICIPATION
FGIC -- FINANCIAL GUARANTY INSURANCE COMPANY
FSA -- FINANCIAL SECURITY ASSISTANCE
GO -- GENERAL OBLIGATION
RB -- REVENUE BOND
SAB -- SPECIAL ASSESSMENT BOND
SER -- SERIES
TRAN -- TAX & REVENUE ANTICIPATION NOTE
The following is a summary of the inputs used as of September 30, 2009 in
valuing the Fund's investments carried at value ($ Thousands):
Investments in Securities Level 1 Level 2 Level 3 Total
------- --------- ------- ---------
Municipal Bonds $ -- $ 905,377 $ -- $ 905,377
Commercial Paper -- 12,700 -- 12,700
------- --------- ------- ---------
Total Investments in
Securities $ -- $ 918,077 $ -- $ 918,077
======= ========= ======= =========
</Table>
FOR MORE INFORMATION ON VALUATION INPUTS, SEE NOTE 2 -- SIGNIFICANT ACCOUNTING
POLICIES IN THE NOTES TO FINANCIAL STATEMENTS.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 60
THIS PAGE INTENTIONALLY LEFT BLANK.
statements of assets and liabilities (000)
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
Large Cap Value Large Cap Growth RCB Small Cap Opportunistic
Equity Fund Equity Fund Value Fund Value Fund
-------------------------------------------------------------------
ASSETS:
Cost of securities (including repurchase agreements) $ 93,993 $ 36,510 $ 19,810 $ 19,291
- ---------------------------------------------------------------------------------------------------------------------------------
Investments in securities at value $ 90,274 $ 37,183 $ 21,144 $ 26,492
Repurchase agreements at value -- -- 2,509 --
Receivable for investment securities sold -- -- 145 468
Income receivable 141 17 38 25
Receivable for capital shares sold 92 27 6 --
Prepaid expenses 1 1 -- 1
- ---------------------------------------------------------------------------------------------------------------------------------
Total Assets 90,508 37,228 23,842 26,986
- ---------------------------------------------------------------------------------------------------------------------------------
LIABILITIES:
Payable for investment securities purchased -- -- 477 707
Payable for capital shares redeemed 69 -- 37 --
Payable for income distributions 93 24 -- --
Investment adviser fees payable 46 20 16 11
Shareholder servicing & distribution fees payable 21 10 2 --
Administrative fees payable 4 1 1 1
Accrued expenses 7 3 11 2
- ---------------------------------------------------------------------------------------------------------------------------------
Total Liabilities 240 58 544 721
- ---------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $ 90,268 $ 37,170 $ 23,298 $ 26,265
=================================================================================================================================
NET ASSETS:
Paid-in Capital (unlimited authorization -- $0.01 par
value) $ 104,640 $ 40,558 $ 28,735 $ 36,848
Undistributed (distribution in excess of) net investment
income (1) -- 15 (1)
Accumulated net realized loss on investments (10,652) (4,061) (9,295) (17,783)
Net unrealized appreciation (depreciation) on
investments (3,719) 673 3,843 7,201
=================================================================================================================================
NET ASSETS $ 90,268 $ 37,170 $ 23,298 $ 26,265
=================================================================================================================================
Institutional Class Shares ($Dollars):
Net Assets $ 81,308,358 $ 28,050,242 $ 2,316,767 $ 156,210
Total shares outstanding at end of year 11,163,741 3,962,847 125,522 23,707
Net asset value, offering and redemption price per
share (net assets / shares outstanding) $ 7.28 $ 7.08 $ 18.46 $ 6.59
Class N Shares ($Dollars):
Net Assets $ 8,959,681 $ 9,119,445 $ 4,226,217 $ 11,335
Total shares outstanding at end of year 1,232,159 1,301,890 233,265 1,723
Net asset value, offering and redemption price per
share (net assets / shares outstanding) $ 7.27 $ 7.00 $ 18.12 $ 6.58
Class E Shares ($Dollars):
Net Assets $ -- $ -- $ -- $ 26,097,478
Total shares outstanding at end of year -- -- -- 4,028,360
Net asset value, offering and redemption price per
share (net assets / shares outstanding) $ -- $ -- $ -- $ 6.48
Class R Shares ($Dollars):
Net Assets $ -- $ -- $ 16,754,628 $ --
Total shares outstanding at end of year -- -- 923,187 --
Net asset value and redemption price per share
(net assets / shares outstanding) $ -- $ -- $ 18.15 $ --
Maximum offering price per share
(net asset value / 96.50%) $ -- $ -- $ 18.81 $ --
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 62
statements of assets and liabilities (000)
SEPTEMBER 30, 2009
- ------------------------------------------------------------------------------
California
Multi-Asset Corporate Government Tax Exempt
Fund Bond Fund Bond Fund Bond Fund
-------------------------------------------------------------
ASSETS:
Cost of securities $ 23,536 $ 84,820 $ 73,451 $ 39,050
- ----------------------------------------------------------------------------------------------------------------------------------
Investments in securities at value $ 20,852 $ 88,473 $ 74,687 $ 40,482
Affiliated investments at value 3,841 -- -- --
Receivable for investment securities sold 531 -- -- --
Income receivable 54 1,005 552 504
Receivable for capital shares sold 34 654 208 74
Prepaid expenses -- 1 1 --
- ----------------------------------------------------------------------------------------------------------------------------------
Total Assets 25,312 90,133 75,448 41,060
- ----------------------------------------------------------------------------------------------------------------------------------
LIABILITIES:
Payable for income distributions 24 185 116 60
Payable for capital shares redeemed 5 -- 211 --
Payable for investment securities purchased -- -- -- 500
Investment adviser fees payable 11 27 21 4
Shareholder servicing & distribution fees payable 9 18 16 8
Administrative fees payable 1 4 3 2
Accrued expenses 2 7 6 3
- ----------------------------------------------------------------------------------------------------------------------------------
Total Liabilities 52 241 373 577
- ----------------------------------------------------------------------------------------------------------------------------------
NET ASSETS $ 25,260 $ 89,892 $ 75,075 $ 40,483
==================================================================================================================================
NET ASSETS:
Paid-in Capital (unlimited authorization -- $0.01 par value) $ 28,327 $ 87,454 $ 73,952 $ 39,238
Undistributed (distribution in excess of) net investment income 11 -- -- --
Accumulated net realized loss on investments and
affiliated investments (4,235) (1,215) (113) (187)
Net unrealized appreciation on investments and
affiliated investments 1,157 3,653 1,236 1,432
==================================================================================================================================
Net Assets $ 25,260 $ 89,892 $ 75,075 $ 40,483
==================================================================================================================================
Institutional Class Shares ($Dollars):
Net Assets $ 8,423,278 $ 88,896,992 $ 71,966,153 $ 38,580,985
Total shares outstanding at end of year 853,756 8,417,481 6,805,095 3,651,041
Net asset value, offering and redemption price per share
(net assets / shares outstanding) $ 9.87 $ 10.56 $ 10.58 $ 10.57
Class N Shares ($Dollars):
Net Assets $ 16,837,181 $ 994,661 $ 3,109,058 $ 1,901,603
Total shares outstanding at end of year 1,707,181 94,115 293,373 179,466
Net asset value, offering and redemption price per share
(net assets / shares outstanding) $ 9.86 $ 10.57 $ 10.60 $ 10.60
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 63
statements of assets and liabilities (000)
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------------------------------------------------
California
Prime Government Tax Exempt
High Yield Money Market Money Market Money Market
Bond Fund Fund Fund Fund
-------------------------------------------------------------------
ASSETS:
Cost of securities (including repurchase
agreements) $ 37,256 $ 1,572,707 $ 3,018,762 $ 918,077
- --------------------------------------------------------------------------------------------------------------------------
Investments in securities at value $ 35,199 $ 1,185,107 $ 2,158,062 $ 918,077
Repurchase agreements at value -- 387,600 860,700 --
Cash 585 -- -- 2,259
Income receivable 781 577 3,898 618
Receivable for investment securities sold 1,326 -- -- --
Receivable for capital shares sold 5 -- -- --
Prepaid expenses -- 28 54 18
- --------------------------------------------------------------------------------------------------------------------------
Total Assets 37,896 1,573,312 3,022,714 920,972
- --------------------------------------------------------------------------------------------------------------------------
LIABILITIES:
Payable for income distributions 70 82 20 11
Payable for investment securities purchased 1,801 -- 50,000 --
Investment adviser fees payable 18 141 303 21
Shareholder servicing & distribution fees payable 12 55 57 27
Administrative fees payable 1 56 104 33
Payable to custodian -- -- 211 --
Accrued expenses 2 121 167 65
- --------------------------------------------------------------------------------------------------------------------------
Total Liabilities 1,904 455 50,862 157
- --------------------------------------------------------------------------------------------------------------------------
NET ASSETS $ 35,992 $ 1,572,857 $ 2,971,852 $ 920,815
==========================================================================================================================
Net Assets:
Paid-in Capital
(unlimited authorization -- $0.01 par value) $ 42,606 $ 1,572,653 $ 2,971,831 $ 920,814
Undistributed net investment income -- 87 17 --
Accumulated net realized gain (loss) on
investments (4,557) 117 4 1
Net unrealized depreciation on investments (2,057) -- -- --
==========================================================================================================================
NET ASSETS $ 35,992 $ 1,572,857 $ 2,971,852 $ 920,815
==========================================================================================================================
Institutional Class Shares ($Dollars):
Net Assets $ 16,354,500 $ 543,326,247 $ 123,863,517 $ 141,578,468
Total shares outstanding at end of year 2,163,152 543,325,213 123,864,394 141,580,604
Net asset value, offering and redemption price
per share (net assets / shares outstanding) $ 7.56 $ 1.00 $ 1.00 $ 1.00
Class N Shares ($Dollars):
Net Assets $ 19,637,063 $ 656,768,757 $2,549,146,717 $ 704,840,428
Total shares outstanding at end of year 2,597,313 656,744,494 2,549,126,892 704,842,075
Net asset value, offering and redemption price
per share (net assets / shares outstanding) $ 7.56 $ 1.00 $ 1.00 $ 1.00
Class S Shares ($ Dollars):
Net Assets $ -- $ 372,762,191 $ 298,842,224 $ 74,395,858
Total shares outstanding at end of year -- 372,676,201 298,840,656 74,392,133
Net asset value and redemption price per share
(net assets / shares outstanding) $ -- $ 1.00 $ 1.00 $ 1.00
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 64
statements of operations
FOR THE YEAR ENDED SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
Large Cap Value Large Cap Growth RCB Small Cap Opportunistic
Equity Fund Equity Fund Value Fund Value Fund
(000) (000) (000) (000)
------------------------------------------------------------------
INCOME:
Dividend Income $ 2,389 $ 561 $ 189 $ 482
Interest Income -- -- 1 --
Less: Foreign Taxes Withheld (1) -- -- (7)
- ----------------------------------------------------------------------------------------------------------------------------
Total Investment Income 2,388 561 190 475
- ----------------------------------------------------------------------------------------------------------------------------
EXPENSES:
Investment Advisory Fee 482 216 153 108
Shareholder Servicing Fees--Institutional Class 174 62 4 --
Shareholder Servicing Fees--Class N(1) 41 41 16 --
Shareholder Servicing Fees--Class R(1) -- -- 33 --
Administration Fee 36 16 8 10
Transfer Agent Fees 6 3 49 2
Trustee Fees 3 1 1 1
Professional Fees 12 5 3 3
Printing Fees 4 2 1 3
Custody Fees 3 1 -- --
Registration Fees 3 1 1 1
Insurance and Other Expenses 9 4 2 21
- ----------------------------------------------------------------------------------------------------------------------------
Total Expenses 773 352 271 149
- ----------------------------------------------------------------------------------------------------------------------------
Recovery of Investment Advisory Fees
Previously Waived(2) -- -- -- 1
Less,Waiver/Reimbursement of:
Shareholder Servicing Fees--Class R(1) -- -- (76) --
Investment Advisory Fee -- -- -- (1)
Transfer Agent Fees (6) (3) (1) (2)
- ----------------------------------------------------------------------------------------------------------------------------
Net Expenses 767 349 194 147
- ----------------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME (LOSS) 1,621 212 (4) 328
- ----------------------------------------------------------------------------------------------------------------------------
Net Realized Loss From Securities Transactions (8,654) (1,908) (8,609) (17,058)
Net Change in Unrealized Appreciation (Depreciation)
on Investments (2,607) (113) 10,677 12,304
- ----------------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS $ (9,640) $ (1,809) $ 2,064 $ (4,426)
============================================================================================================================
- ----------
(1) INCLUDES CLASS SPECIFIC DISTRIBUTION EXPENSES.
(2) SEE NOTE 4 FOR ADVISORY FEES RECOVERED.
AMOUNTS DESIGNATED AS "--" ARE ZERO OR HAVE BEEN ROUNDED TO ZERO.
SEE COMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 65
statements of operations
FOR THE YEAR ENDED SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
California
Multi-Asset Corporate Government Tax Exempt
Fund Bond Fund Bond Fund Bond Fund
(000) (000) (000) (000)
-----------------------------------------------------
INCOME:
Interest Income $ 40 $ 3,489 $ 2,908 $ 1,329
Dividend Income 427 26 19 7
Income from Affiliated Investments 147 -- -- --
-----------------------------------------------------------------------------------------------------------------
Total Investment Income 614 3,515 2,927 1,336
-----------------------------------------------------------------------------------------------------------------
EXPENSES:
Investment Advisory Fee 120 304 315 98
Shareholder Servicing Fees--Institutional Class 22 188 176 87
Shareholder Servicing Fees--Class N(1) 76 4 15 7
Administration Fee 11 36 34 17
Transfer Agent Fees 2 6 6 3
Trustee Fees 1 3 3 1
Professional Fees 3 12 10 5
Printing Fees 1 4 4 2
Custody Fees 1 4 3 2
Registration Fees 1 2 2 1
Insurance and Other Expenses 3 8 8 4
-----------------------------------------------------------------------------------------------------------------
Total Expenses 241 571 576 227
-----------------------------------------------------------------------------------------------------------------
Less,Waivers of:
Investment Advisory Fees -- (2) (49) (39)
Transfer Agent Fees (2) (6) (6) (3)
-----------------------------------------------------------------------------------------------------------------
NET EXPENSES 239 563 521 185
-----------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 375 2,952 2,406 1,151
-----------------------------------------------------------------------------------------------------------------
Net Realized Gain (Loss) From Securities Transactions (3,857) (674) 453 (93)
Net Realized Gain From Affiliated Investments 1 -- -- --
Net Change in Unrealized Appreciation on Investments 3,782 6,838 805 1,914
Net Change in Unrealized Appreciation on
Affiliated Investments 200 -- -- --
-----------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 501 $ 9,116 $ 3,664 $ 2,972
=================================================================================================================
- ----------
(1) Includes class specific distribution expenses.
Amounts designated as "--" are either $0 or have been rounded to $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 66
statements of operations
FOR THE YEAR ENDED SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
California
Prime Government Tax Exempt
High Yield Money Market Money Market Money Market
Bond Fund Fund Fund Fund
(000) (000) (000) (000)
-------------------------------------------------------------
INCOME:
Interest Income $ 3,005 $ 19,099 $ 22,179 $ 7,505
Dividend Income 22 12 -- --
- ----------------------------------------------------------------------------------------------------------------------
Total Investment Income 3,027 19,111 22,179 7,505
- ----------------------------------------------------------------------------------------------------------------------
EXPENSES:
Investment Advisory Fee 211 4,933 8,500 3,042
Shareholder Servicing Fees--Institutional Class 32 1,499 347 489
Shareholder Servicing Fees--Class N(1) 86 6,504 20,704 6,308
Shareholder Servicing Fees--Class S(1) -- 3,797 2,774 676
Administration Fee 13 915 1,519 524
Transfer Agent Fees 2 162 268 92
Trustee Fees 1 79 125 45
Professional Fees 4 263 429 143
Printing Fees 2 112 167 60
Custody Fees 1 94 150 51
Registration Fees 1 77 141 26
Treasury Guarantee Program Fees -- 950 845 482
Insurance and Other Expenses 3 253 359 123
- ----------------------------------------------------------------------------------------------------------------------
Total Expenses 356 19,638 36,328 12,061
- ----------------------------------------------------------------------------------------------------------------------
Less,Waivers of:
Investment Advisory Fees (25) (880) (2,210) (1,568)
Administration Fees -- (85) (163) (58)
Shareholder Servicing Fees--Institutional Class -- (869) (258) (386)
Shareholder Servicing Fees--Class N(1) -- (4,173) (15,981) (4,975)
Shareholder Servicing Fees--Class S(1) -- (1,862) (1,906) (428)
Transfer Agent Fees (2) (162) (268) (92)
- ----------------------------------------------------------------------------------------------------------------------
NET EXPENSES 329 11,607 15,542 4,554
- ----------------------------------------------------------------------------------------------------------------------
NET INVESTMENT INCOME 2,698 7,504 6,637 2,951
- ----------------------------------------------------------------------------------------------------------------------
Net Realized Gain (Loss) From Securities Transactions (3,203) 117 4 --
Net Change in Unrealized Appreciation on Investments 4,440 -- -- --
- ----------------------------------------------------------------------------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 3,935 $ 7,621 $ 6,641 $ 2,951
======================================================================================================================
- ----------
(1) INCLUDES CLASS SPECIFIC DISTRIBUTION EXPENSES.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 67
statements of changes in net assets
FOR THE YEAR ENDED SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
Large Cap Value Large Cap Growth
Equity Fund (000) Equity Fund (000)
--------------------- -------------------
2009 2008 2009 2008
- ----------------------------------------------------------------------------------------------------- -------------------
OPERATIONS:
Net Investment Income (Loss) $ 1,621 $ 1,828 $ 212 $ 154
Net Realized Gain (Loss) from Security Transactions and
Affiliated Investments (8,654) (2,121) (1,908) 229
Net Change in Unrealized Appreciation
(Depreciation) on Investments and Affiliated Investments (2,607) (27,129) (113) (9,483)
- ----------------------------------------------------------------------------------------------------- -------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations (9,640) (27,422) (1,809) (9,100)
- ----------------------------------------------------------------------------------------------------- -------------------
DIVIDENDS AND DISTRIBUTIONS FROM:
Net investment income:
INSTITUTIONAL CLASS (1,358) (1,637) (182) (138)
CLASS N (137) (190) (40) (14)
CLASS R -- -- -- --
CLASS E -- -- -- --
Realized Capital Gains:
INSTITUTIONAL CLASS -- (4,754) -- --
CLASS N -- (735) -- --
CLASS R -- -- -- --
- ----------------------------------------------------------------------------------------------------- -------------------
Total Dividends & Distributions (1,495) (7,316) (222) (152)
- ----------------------------------------------------------------------------------------------------- -------------------
CAPITAL SHARE TRANSACTIONS:(1)
INSTITUTIONAL CLASS:
Shares issued 20,103 22,976 6,861 5,320
Shares issued in Lieu of Dividends and Distributions 950 4,640 56 47
Shares Redeemed (18,562) (18,936) (8,638) (13,229)
- ----------------------------------------------------------------------------------------------------- -------------------
Increase (Decrease) in Net Assets from
Institutional Class Share Transactions 2,491 8,680 (1,721) (7,862)
- ----------------------------------------------------------------------------------------------------- -------------------
CLASS N:
Shares issued 538 623 554 909
Shares issued in Lieu of Dividends and Distributions 93 660 25 9
Shares Redeemed (1,792) (2,366) (2,072) (2,236)
- ----------------------------------------------------------------------------------------------------- -------------------
Increase (Decrease) in Net Assets from
Class N Share Transactions (1,161) (1,083) (1,493) (1,318)
- ----------------------------------------------------------------------------------------------------- -------------------
CLASS R:
Shares Issued -- -- -- --
Shares Issued in Lieu of Dividends and Distributions -- -- -- --
Shares Redeemed -- -- -- --
- ----------------------------------------------------------------------------------------------------- -------------------
Decrease in Net Assets from
Class R Share Transactions -- -- -- --
- ----------------------------------------------------------------------------------------------------- -------------------
CLASS E:
Shares Issued -- -- -- --
Shares Issued in Lieu of Dividends and Distributions -- -- -- --
Shares Redeemed -- -- -- --
- ----------------------------------------------------------------------------------------------------- -------------------
Increase (Decrease) in Net Assets from
Class E Share Transactions -- -- -- --
- ----------------------------------------------------------------------------------------------------- -------------------
Net Increase (Decrease) in Net Assets from Share Transactions 1,330 7,597 (3,214) (9,180)
- ----------------------------------------------------------------------------------------------------- -------------------
Total Increase (Decrease) in Net Assets (9,805) (27,141) (5,245) (18,432)
- ----------------------------------------------------------------------------------------------------- -------------------
NET ASSETS:
Beginning of Period 100,073 127,214 42,415 60,847
- ----------------------------------------------------------------------------------------------------- -------------------
End of Period $ 90,268 $ 100,073 $ 37,170 $ 42,415
===================================================================================================== ===================
Undistributed (Distributions in Excess of)
Net Investment Income $ (1) $ (127) $ -- $ 10
- ----------------------------------------------------------------------------------------------------- -------------------
- ----------
* FUND COMMENCED OPERATIONS ON OCTOBER 1, 2007.
** FUND COMMENCED OPERATIONS ON JUNE 26, 2008.
(1) SEE NOTE 8 FOR SHARES ISSUED AND REDEEMED.
(2) INCLUDES SUBSCRIPTIONS AS A RESULT OF AN IN-KIND TRANSFER OF SECURITIES
(SEE NOTE 9).
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 68
RCB Small Cap Opportunistic Value
Value Fund (000) Fund (000)
- ---------------------------------------------------------------------------------------------------------------------------
2009 2008 2009 2008**
- ---------------------------------------------------------------------------------------------------------------------------
OPERATIONS:
Net Investment Income (Loss) $ (4) $ 364 $ 328 $ 174
Net Realized Gain (Loss) from Security Transactions and
Affiliated Investments (8,609) 53 (17,058) (725)
Net Change in Unrealized Appreciation
(Depreciation) on Investments and Affiliated Investments 10,677 (18,035) 12,304 (5,103)
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 2,064 (17,618) (4,426) (5,654)
- ---------------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS FROM:
Net investment income:
INSTITUTIONAL CLASS (29) -- (1) --
CLASS N (69) -- (1) --
CLASS R (341) -- -- --
CLASS E -- -- (501) --
Realized Capital Gains:
INSTITUTIONAL CLASS -- (1,426) -- --
CLASS N -- (1,567) -- --
CLASS R -- (6,612) -- --
- ---------------------------------------------------------------------------------------------------------------------------
Total Dividends & Distributions (439) (9,605) (503) --
- ---------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS:(1)
INSTITUTIONAL CLASS:
Shares issued 750 944 127 --
Shares issued in Lieu of Dividends and Distributions 29 1,255 1 --
Shares Redeemed (537) (6,104) -- --
- ---------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets from
Institutional Class Share Transactions 242 (3,905) 128 --
- ---------------------------------------------------------------------------------------------------------------------------
CLASS N:
Shares issued 17 111 5 8
Shares issued in Lieu of Dividends and Distributions 50 1,250 -- --
Shares Redeemed (403) (2,424) -- --
- ---------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets from
Class N Share Transactions (336) (1,063) 5 8
- ---------------------------------------------------------------------------------------------------------------------------
CLASS R:
Shares Issued 961 5,853 -- --
Shares Issued in Lieu of Dividends and Distributions 325 6,293 -- --
Shares Redeemed (4,706) (14,527) -- --
- ---------------------------------------------------------------------------------------------------------------------------
Decrease in Net Assets from
Class R Share Transactions (3,420) (2,381) -- --
- ---------------------------------------------------------------------------------------------------------------------------
CLASS E:
Shares Issued -- -- 16,515 50,892(2)
Shares Issued in Lieu of Dividends and Distributions -- -- 500 --
Shares Redeemed -- -- (31,200) --
- ---------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets from
Class E Share Transactions -- -- (14,185) 50,892
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets from Share Transactions (3,514) (7,349) (14,052) 50,900
- ---------------------------------------------------------------------------------------------------------------------------
Total Increase (Decrease) in Net Assets (1,889) (34,572) (18,981) 45,246
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of Period 25,187 59,759 45,246 --
- ---------------------------------------------------------------------------------------------------------------------------
End of Period $ 23,298 $ 25,187 $ 26,265 $ 45,246
===========================================================================================================================
Undistributed (Distributions in Excess of)
Net Investment Income $ 15 $ 436 $ (1) $ 174
- ---------------------------------------------------------------------------------------------------------------------------
Multi-Asset Corporate Bond
Fund (000) Fund (000)
- ---------------------------------------------------------------------------------------------------------------------------
2009 2008* 2009 2008
- ---------------------------------------------------------------------------------------------------------------------------
OPERATIONS:
Net Investment Income (Loss) $ 375 $ 474 $ 2,952 $ 2,891
Net Realized Gain (Loss) from Security Transactions and
Affiliated Investments (3,856) (369) (674) (66)
Net Change in Unrealized Appreciation
(Depreciation) on Investments and Affiliated Investments 3,982 (2,825) 6,838 (3,019)
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 501 (2,720) 9,116 (194)
- ---------------------------------------------------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS FROM:
Net investment income:
INSTITUTIONAL CLASS (149) (205) (2,926) (2,857)
CLASS N (226) (268) (26) (31)
CLASS R -- -- -- --
CLASS E -- -- -- --
Realized Capital Gains:
INSTITUTIONAL CLASS -- -- -- --
CLASS N -- -- -- --
CLASS R -- -- -- --
- ---------------------------------------------------------------------------------------------------------------------------
Total Dividends & Distributions (375) (473) (2,952) (2,888)
- ---------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS:(1)
INSTITUTIONAL CLASS:
Shares issued 4,298 13,719 27,853 23,936
Shares issued in Lieu of Dividends and Distributions 90 50 676 605
Shares Redeemed (6,506) (1,732) (15,448) (13,983)
- ---------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets from
Institutional Class Share Transactions (2,118) 12,037 13,081 10,558
- ---------------------------------------------------------------------------------------------------------------------------
CLASS N:
Shares issued 3,250 20,655 488 39
Shares issued in Lieu of Dividends and Distributions 107 118 13 16
Shares Redeemed (3,554) (2,168) (171) (467)
- ---------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets from
Class N Share Transactions (197) 18,605 330 (412)
- ---------------------------------------------------------------------------------------------------------------------------
CLASS R:
Shares Issued -- -- -- --
Shares Issued in Lieu of Dividends and Distributions -- -- -- --
Shares Redeemed -- -- -- --
- ---------------------------------------------------------------------------------------------------------------------------
Decrease in Net Assets from
Class R Share Transactions -- -- -- --
- ---------------------------------------------------------------------------------------------------------------------------
CLASS E:
Shares Issued -- -- -- --
Shares Issued in Lieu of Dividends and Distributions -- -- -- --
Shares Redeemed -- -- -- --
- ---------------------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Net Assets from
Class E Share Transactions -- -- -- --
- ---------------------------------------------------------------------------------------------------------------------------
Net Increase (Decrease) in Net Assets from Share Transactions (2,315) 30,642 13,411 10,146
- ---------------------------------------------------------------------------------------------------------------------------
Total Increase (Decrease) in Net Assets (2,189) 27,449 19,575 7,064
- ---------------------------------------------------------------------------------------------------------------------------
NET ASSETS:
Beginning of Period 27,449 -- 70,317 63,253
- ---------------------------------------------------------------------------------------------------------------------------
End of Period $ 25,260 $ 27,449 $ 89,892 $ 70,317
===========================================================================================================================
Undistributed (Distributions in Excess of)
Net Investment Income $ 11 $ 1 $ -- $ 1
- ---------------------------------------------------------------------------------------------------------------------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 69
statements of changes in net assets
FOR THE YEAR ENDED SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
Government California Tax Exempt
Bond Fund (000) Bond Fund (000)
-------------------- ---------------------
2009 2008 2009 2008
- ----------------------------------------------------------------------------------------------------- ---------------------
OPERATIONS:
Net Investment Income $ 2,406 $ 2,627 $ 1,151 $ 1,063
Net Realized Gain (Loss) from
Security Transactions 453 42 (93) (52)
Net Change in Unrealized Appreciation
(Depreciation) on Investments 805 250 1,914 (573)
- ----------------------------------------------------------------------------------------------------- ---------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 3,664 2,919 2,972 438
- ----------------------------------------------------------------------------------------------------- ---------------------
DIVIDENDS AND DISTRIBUTIONS FROM:
Net Investment Income:
INSTITUTIONAL CLASS (2,343) (2,532) (1,110) (1,041)
CLASS N (92) (107) (41) (22)
CLASS S -- -- -- --
- ----------------------------------------------------------------------------------------------------- ---------------------
TOTAL DIVIDENDS AND DISTRIBUTIONS (2,435) (2,639) (1,151) (1,063)
- ----------------------------------------------------------------------------------------------------- ---------------------
CAPITAL SHARE TRANSACTIONS:(1)
INSTITUTIONAL CLASS:
Shares Issued 22,819 24,102 12,423 10,565
Shares Issued in Lieu of Dividends and Distributions 677 699 403 369
Shares Redeemed (18,805) (11,579) (10,248) (9,859)
- ----------------------------------------------------------------------------------------------------- ---------------------
Increase (Decrease) in Net Assets from
Institutional Class Share Transactions 4,691 13,222 2,578 1,075
- ----------------------------------------------------------------------------------------------------- ---------------------
CLASS N:
Shares Issued 1,066 780 1,359 776
Shares Issued in Lieu of Dividends and Distributions 39 44 12 4
Shares Redeemed (808) (706) (598) (643)
- ----------------------------------------------------------------------------------------------------- ---------------------
Increase (Decrease) in Net Assets from
Class N Share Transactions 297 118 773 137
- ----------------------------------------------------------------------------------------------------- ---------------------
CLASS S:
Shares Issued -- -- -- --
Shares Issued in Lieu of Dividends and Distributions -- -- -- --
Shares Redeemed -- -- -- --
- ----------------------------------------------------------------------------------------------------- ---------------------
Increase (Decrease) in Net Assets from
Class S Share Transactions -- -- -- --
- ----------------------------------------------------------------------------------------------------- ---------------------
Net Increase (Decrease) in Net Assets from
Share Transactions 4,988 13,340 3,351 1,212
- ----------------------------------------------------------------------------------------------------- ---------------------
Total Increase (Decrease) in Net Assets 6,217 13,620 5,172 587
- ----------------------------------------------------------------------------------------------------- ---------------------
NET ASSETS:
Beginning of Period 68,858 55,238 35,311 34,724
- ----------------------------------------------------------------------------------------------------- ---------------------
End of Period $ 75,075 $ 68,858 $ 40,483 $ 35,311
===================================================================================================== =====================
Undistributed (Distribution in Excess of) Net Investment Income $ -- $ (1) $ -- $ --
- ----------------------------------------------------------------------------------------------------- ---------------------
- ----------
(1) SEE NOTE 9 FOR SHARES ISSUED AND REDEEMED.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 70
High Yield Prime Money
Bond Fund (000) Market Fund (000)
------------------- --------------------------
2009 2008 2009 2008
------------------- --------------------------
OPERATIONS:
Net Investment Income $ 2,698 $ 2,807 $ 7,504 $ 61,887
Net Realized Gain (Loss) from
Security Transactions (3,203) (526) 117 297
Net Change in Unrealized Appreciation
(Depreciation) on Investments 4,440 (5,822) -- --
- ---------------------------------------------------------------------------------------------------- --------------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 3,935 (3,541) 7,621 62,184
- ---------------------------------------------------------------------------------------------------- --------------------------
DIVIDENDS AND DISTRIBUTIONS FROM:
Net Investment Income:
INSTITUTIONAL CLASS (1,246) (1,258) (2,739) (14,508)
CLASS N (1,509) (1,548) (3,352) (30,822)
CLASS S -- -- (1,412) (16,569)
- ---------------------------------------------------------------------------------------------------- --------------------------
TOTAL DIVIDENDS AND DISTRIBUTIONS (2,755) (2,806) (7,503) (61,899)
- ---------------------------------------------------------------------------------------------------- --------------------------
CAPITAL SHARE TRANSACTIONS:(1)
INSTITUTIONAL CLASS:
Shares Issued 2,072 1,173 1,288,265 1,704,267
Shares Issued in Lieu of Dividends and Distributions 834 862 442 2,772
Shares Redeemed (999) (2,455) (1,278,342) (1,612,805)
- ---------------------------------------------------------------------------------------------------- --------------------------
Increase (Decrease) in Net Assets from 1,907 (420) 10,365 94,234
Institutional Class Share Transactions
- ----------------------------------------------------------------------------------------------------- --------------------------
CLASS N:
Shares Issued 2,628 1,645 2,117,635 3,333,223
Shares Issued in Lieu of Dividends and Distributions 1,002 1,000 1,555 13,996
Shares Redeemed (2,172) (1,689) (2,586,377) (3,093,998)
- ---------------------------------------------------------------------------------------------------- --------------------------
Increase (Decrease) in Net Assets from 1,458 956 (467,187) 253,221
Class N Share Transactions
- ---------------------------------------------------------------------------------------------------- --------------------------
CLASS S:
Shares Issued -- -- 1,140,178 1,657,732
Shares Issued in Lieu of Dividends and Distributions -- -- -- --
Shares Redeemed -- -- (1,401,263) (1,644,197)
- ---------------------------------------------------------------------------------------------------- --------------------------
Increase (Decrease) in Net Assets from
Class S Share Transactions -- -- (261,085) 13,535
- ---------------------------------------------------------------------------------------------------- --------------------------
Net Increase (Decrease) in Net Assets from
Share Transactions 3,365 536 (717,907) 360,990
- ---------------------------------------------------------------------------------------------------- --------------------------
Total Increase (Decrease) in Net Assets 4,545 (5,811) (717,789) 361,275
- ---------------------------------------------------------------------------------------------------- --------------------------
NET ASSETS:
Beginning of Period 31,447 37,258 2,290,646 1,929,371
- ---------------------------------------------------------------------------------------------------- --------------------------
End of Period $ 35,992 $ 31,447 $ 1,572,857 $ 2,290,646
====================================================================================================== =========================
Undistributed (Distribution in Excess of) Net Investment Income $ -- $ 57 $ 87 $ (1)
- ---------------------------------------------------------------------------------------------------- --------------------------
Government Money California Tax Exempt
Market Fund (000) Money Market Fund (000)
------------------------- ------------------------
2009 2008 2009 2008
------------------------- ------------------------
OPERATIONS:
Net Investment Income $ 6,637 $ 73,638 $ 2,951 $ 17,077
Net Realized Gain (Loss) from
Security Transactions 4 17 -- --
Net Change in Unrealized Appreciation
(Depreciation) on Investments -- -- -- --
- ---------------------------------------------------------------------------------------------------- --------------------------
Net Increase (Decrease) in Net Assets
Resulting from Operations 6,641 73,655 2,951 17,077
- ---------------------------------------------------------------------------------------------------- --------------------------
DIVIDENDS AND DISTRIBUTIONS FROM:
Net Investment Income:
INSTITUTIONAL CLASS (356) (1,571) (612) (2,286)
CLASS N (5,784) (64,510) (2,109) (12,486)
CLASS S (495) (7,574) (232) (2,303)
- ---------------------------------------------------------------------------------------------------- --------------------------
TOTAL DIVIDENDS AND DISTRIBUTIONS (6,635) (73,655) (2,953) (17,075)
- ---------------------------------------------------------------------------------------------------- --------------------------
CAPITAL SHARE TRANSACTIONS:(1)
INSTITUTIONAL CLASS:
Shares Issued 655,511 553,021 1,126,167 1,830,572
Shares Issued in Lieu of Dividends and Distributions 8 3 -- --
Shares Redeemed (632,330) (500,209) (1,142,015) (1,762,382)
- ---------------------------------------------------------------------------------------------------- --------------------------
Increase (Decrease) in Net Assets from 23,189 52,815 (15,848) 68,190
Institutional Class Share Transactions
- ---------------------------------------------------------------------------------------------------- --------------------------
CLASS N:
Shares Issued 4,478,647 6,290,498 1,708,583 2,477,610
Shares Issued in Lieu of Dividends and Distributions 4,161 43,391 1,814 9,947
Shares Redeemed (4,940,602) (5,618,090) (1,886,349) (2,302,084)
- ---------------------------------------------------------------------------------------------------- --------------------------
Increase (Decrease) in Net Assets from (457,794) 715,799 (175,952) 185,473
Class N Share Transactions
- ---------------------------------------------------------------------------------------------------- --------------------------
CLASS S:
Shares Issued 659,453 801,055 354,327 409,458
Shares Issued in Lieu of Dividends and Distributions -- -- -- --
Shares Redeemed (769,358) (713,370) (421,688) (446,618)
- ---------------------------------------------------------------------------------------------------- --------------------------
Increase (Decrease) in Net Assets from
Class S Share Transactions (109,905) 87,685 (67,361) (37,160)
- ---------------------------------------------------------------------------------------------------- --------------------------
Net Increase (Decrease) in Net Assets from
Share Transactions (544,510) 856,299 (259,161) 216,503
- ---------------------------------------------------------------------------------------------------- --------------------------
Total Increase (Decrease) in Net Assets (544,504) 856,299 (259,163) 216,505
- ---------------------------------------------------------------------------------------------------- --------------------------
NET ASSETS:
Beginning of Period 3,516,356 2,660,057 1,179,978 963,473
- ---------------------------------------------------------------------------------------------------- --------------------------
End of Period $ 2,971,852 $ 3,516,356 $ 920,815 $ 1,179,978
====================================================================================================== =========================
Undistributed (Distribution in Excess of) Net Investment Income $ 17 $ (1) $ -- $ 2
- ---------------------------------------------------------------------------------------------------- --------------------------
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 71
financial highlights
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
FOR THE YEAR/PERIOD ENDED SEPTEMBER 30,
- -------------------------------------------------------------------------------
NET
NET REALIZED AND DISTRIBUTIONS NET NET
ASSET NET UNREALIZED DIVIDENDS FROM ASSET ASSETS RATIO
VALUE INVESTMENT GAINS (LOSSES) FROM NET REALIZED VALUE END OF EXPENSES
BEGINNING INCOME ON INVESTMENT CAPITAL END TOTAL OF PERIOD TO AVERAGE
OF PERIOD (LOSS)+ SECURITIES I NCOME GAINS OF PERIOD RETURN++ (000) NET ASSETS(1)(2)
- -----------------------------------------------------------------------------------------------------------------------------------
LARGE CAP VALUE EQUITY FUND
Institutional Class (commenced operations on January 14, 2000)
2009 $ 8.25 $ 0.13 $ (0.98) $ (0.12) $ -- $ 7.28 (10.03)% $ 81,308 0.96%
2008 11.21 0.16 (2.48) (0.15) (0.49) 8.25 (21.57) 88,361 0.95
2007 10.36 0.19 1.38 (0.19) (0.53) 11.21 15.60 110,024 0.96
2006 9.54 0.13 1.21 (0.13) (0.39) 10.36 14.50 92,946 0.96
2005 8.77 0.10 1.13 (0.10) (0.36) 9.54 14.39 42,974 0.96
Class N (commenced operations on April 13, 2000)
2009 $ 8.24 $ 0.12 $ (0.98) $ (0.11) $ -- $ 7.27 (10.27)% $ 8,960 1.21%
2008 11.19 0.13 (2.46) (0.13) (0.49) 8.24 (21.72) 11,712 1.20
2007 10.35 0.16 1.37 (0.16) (0.53) 11.19 15.24 17,190 1.21
2006 9.53 0.11 1.20 (0.10) (0.39) 10.35 14.24 13,104 1.21
2005 8.76 0.09 1.12 (0.08) (0.36) 9.53 14.14 10,664 1.21
- -----------------------------------------------------------------------------------------------------------------------------------
LARGE CAP GROWTH EQUITY FUND
Institutional Class (commenced operations on January 14, 2000)
2009 $ 7.38 $ 0.04 $ (0.30) $ (0.04) $ -- $ 7.08 (3.36)% $ 28,050 0.99%
2008 8.86 0.03 (1.48) (0.03) -- 7.38 (16.40) 31,074 0.98
2007 7.75 0.05 1.10 (0.04) -- 8.86 14.91 45,784 0.99
2006 7.43 0.02 0.32 (0.02) -- 7.75 4.59 35,842 0.99
2005 6.76 0.04 0.67 (0.04) -- 7.43 10.55 34,164 0.98
Class N (commenced operations on March 28, 2000)
2009 $ 7.31 $ 0.03 $ (0.31) $ (0.03) $ -- $ 7.00 (3.77)% $ 9,120 1.24%
2008 8.77 0.01 (1.46) (0.01) -- 7.31 (16.55) 11,341 1.23
2007 7.68 0.01 1.10 (0.02) -- 8.77 14.51 15,063 1.24
2006 7.35 -- 0.33 --# -- 7.68 4.55 10,363 1.24
2005 6.69 0.02 0.67 (0.03) -- 7.35 10.28 8,278 1.23
- -----------------------------------------------------------------------------------------------------------------------------------
RCB SMALL CAP VALUE FUND
Institutional Class (commenced operations on October 3, 2001)
2009 $ 16.42 $ (0.02) $ 2.35 $ (0.29) $ -- $ 18.46 15.20% $ 2,317 1.19%
2008 30.79 0.19 (9.57) -- (4.99) 16.42 (35.01) 1,742 1.19
2007 28.25 0.02 3.00 (0.01) (0.47) 30.79 10.65 9,062 1.19
2006 28.58 0.06 0.05 (0.07) (0.37) 28.25 0.40 13,435 1.20
2005 27.30 0.07 2.58 -- (1.37) 28.58 9.87 13,975 1.18
Class N (commenced operations on October 3, 2001)
2009 $ 16.14 $ (0.05) $ 2.30 $ (0.27) $ -- $ 18.12 14.91% $ 4,226 1.44%
2008 30.42 0.15 (9.44) -- (4.99) 16.14 (35.16) 4,262 1.44
2007 27.98 (0.05) 2.96 -- (0.47) 30.42 10.37 9,753 1.44
2006 28.31 (0.01) 0.05 --# (0.37) 27.98 0.17 10,470 1.45
2005 27.13 0.00 2.55 -- (1.37) 28.31 9.55 12,754 1.43
Class R (commenced operations on September 30, 1998)
2009 $ 16.15 $ 0.01 $ 2.31 $ (0.32) $ -- $ 18.15 15.50% $ 16,755 0.97%
2008 30.38 0.20 (9.44) -- (4.99) 16.15 (35.02) 19,183 1.23
2007 27.93 (0.05) 2.97 -- (0.47) 30.38 10.43 40,944 1.44
2006 28.27 (0.01) 0.04 --# (0.37) 27.93 0.14 45,836 1.45
2005 27.09 0.01 2.54 -- (1.37) 28.27 9.56 57,787 1.43
- -----------------------------------------------------------------------------------------------------------------------------------
OPPORTUNISTIC VALUE FUND
Institutional Class (commenced operations on June 26, 2008)
2009 $ 9.31 $ 0.07 $ (1.11) $ (1.68) $ -- $ 6.59 (6.81)% $ 156 0.93%
2008 10.00 0.05 (0.74) -- -- 9.31 (6.90) -- 0.23(3)
Class N (commenced operations on June 26, 2008)
2009 $ 9.31 $ 0.06 $ (1.12) $ (1.67) $ -- $ 6.58 (7.12)% $ 11 1.22%
2008 10.00 0.04 (0.73) -- -- 9.31 (6.90) 7 1.20(3)
Class E (commenced operations on June 26, 2008)
2009 $ 9.30 $ 0.09 $ (1.21) $ (1.70) $ -- $ 6.48 (7.57)% $ 26,098 0.68%
2008 10.00 0.04 (0.74) -- -- 9.30 (7.00) 45,239 0.69(3)
- -----------------------------------------------------------------------------------------------------------------------------------
MULTI-ASSET FUND
Institutional Class (commenced operations on October 1, 2007)
2009 $ 9.70 $ 0.15 $ 0.18 $ (0.16) $ -- $ 9.87 3.54% $ 8,423 0.83%
2008 11.00 0.25 (1.32) (0.23) -- 9.70 (9.84) 10,741 1.29
Class N (commenced operations on October 1, 2007)
2009 $ 9.69 $ 0.13 $ 0.18 $ (0.14) $ -- $ 9.86 3.29% $ 16,837 1.09%
2008 11.00 0.23 (1.33) (0.21) -- 9.69 (10.12) 16,708 1.53
RATIO
OF
EXPENSES
RATIO TO AVERAGE
OF NET NET ASSETS
INVESTMENT (EXCLUDING
INCOME (LOSS) WAIVERS & PORTFOLIO
TO AVERAGE RECOVERED TURNOVER
NET ASSETS(1) FEES)(1) RATE
Large Cap Value Equity Fund
Institutional Class (commenced operations on January 14, 2000)
2009 2.11% 0.97% 18%
2008 1.64 0.96 36
2007 1.73 0.97 24
2006 1.36 0.97 31
2005 1.12 0.97 34
Class N (commenced operations on April 13, 2000)
2009 1.89% 1.22% 18%
2008 1.38 1.21 36
2007 1.47 1.22 24
2006 1.13 1.22 31
2005 0.87 1.22 34
- -------------------------------------------------------------
Large Cap Growth Equity Fund
Institutional Class (commenced operations on January 14, 2000)
2009 0.70% 1.00% 12%
2008 0.35 0.99 26
2007 0.52 1.00 30
2006 0.27 1.00 34
2005 0.57 1.00 27
Class N (commenced operations on March 28, 2000)
2009 0.45% 1.25% 12%
2008 0.11 1.24 26
2007 0.28 1.25 30
2006 0.03 1.25 34
2005 0.33 1.25 27
- -------------------------------------------------------------
RCB Small Cap Value Fund
Institutional Class (commenced operations on October 3, 2001)
2009 (0.13)% 1.20% 62%
2008 0.85 1.20 78
2007 0.08 1.20 57
2006 0.20 1.21 66
2005 0.26 1.20 41
Class N (commenced operations on October 3, 2001)
2009 (0.37)% 1.45% 62%
2008 0.70 1.45 78
2007 (0.16) 1.45 57
2006 (0.04) 1.46 66
2005 0.01 1.45 41
Class R (commenced operations on September 30, 1998)
2009 0.08% 1.55% 62%
2008 0.92 1.55 78
2007 (0.17) 1.45 57
2006 (0.04) 1.46 66
2005 0.02 1.45 41
- -------------------------------------------------------------
Opportunistic Value Fund
Institutional Class (commenced operations on June 26, 2008)
2009 1.13% 0.94% 144%
2008 1.83 0.23(3) 5
Class N (commenced operations on June 26, 2008)
2009 0.98% 1.23% 144%
2008 1.50 1.23(3) 5
Class E (commenced operations on June 26, 2008)
2009 1.53% 0.69% 144%
2008 1.44 0.70(3) 5
- -------------------------------------------------------------
Multi-Asset Fund
Institutional Class (commenced operations on October 1, 2007)
2009 1.71% 0.84% 94%
2008 2.37 1.30 141
Class N (commenced operations on October 1, 2007)
2009 1.46% 1.10% 94%
2008 2.22 1.54 141
- ----------
+ PER SHARE CALCULATIONS ARE BASED ON AVERAGE SHARES OUTSTANDING THROUGHOUT
THE PERIOD.
++ RETURNS ARE FOR THE PERIOD INDICATED AND HAVE NOT BEEN ANNUALIZED.
FEE WAIVERS ARE IN EFFECT; IF THEY HAD NOT BEEN IN EFFECT, PERFORMANCE
WOULD HAVE BEEN LOWER.TOTAL RETURN FIGURES DO NOT INCLUDE APPLICABLE SALES
LOADS. RETURNS SHOWN DO NOT REFLECT THE DEDUCTION OF TAXES THAT A
SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND
SHARES.
# AMOUNT REPRESENTS LESS THAN $0.01 PER SHARE.
(1) ANNUALIZED FOR PERIODS LESS THAN ONE YEAR.
(2) RATIO INCLUDES WAIVERS AND PREVIOUSLY WAIVED INVESTMENT ADVISORY FEES
RECOVERED.THE IMPACT OF THE RECOVERED FEES MAY CAUSE A HIGHER NET EXPENSE
RATIO.
(3) RATIO REFLECTS THE IMPACT OF THE INITIAL LOW LEVEL OF AVERAGE NET ASSETS
ASSOCIATED WITH COMMENCEMENT OF OPERATIONS.
AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO $0.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 72
NET
NET REALIZED AND DISTRIBUTNETS NET
ASSET UNREALIZD DIVIDENDS FROM ASSETS
VALUE NET GAINS (LOSSES) FROM NET REALIZED VALUE
BEGINNING INVESTMENT ON INVESTMENT CAPITAL END
OF PERIOD INCOME SECURITIIS+ INCOME GAINS OF PERIOD
- ---------------------------------------------------------------------------------------------
Corporate Bond Fund
Institutional Class (commenced operations on January 14, 2000)
2009 $ 9.76 $ 0.39 $ 0.80 $ (0.39) $ -- $ 10.56
2008 10.18 0.43 (0.41) (0.44) -- 9.76
2007 10.17 0.45 -- (0.44) -- 10.18
2006 10.27 0.42 (0.10) (0.42) -- 10.17
2005 10.60 0.40 (0.27) (0.40) (0.06) 10.27
Class N (commenced operations on April 13, 2000)
2009 $ 9.77 $ 0.36 $ 0.81 $ (0.37) $ -- $ 10.57
2008 10.18 0.41 (0.41) (0.41) -- 9.77
2007 10.17 0.42 0.01 (0.42) -- 10.18
2006 10.27 0.39 (0.10) (0.39) -- 10.17
2005 10.61 0.37 (0.28) (0.37) (0.06) 10.27
- ---------------------------------------------------------------------------------------------
Government Bond Fund
Institutional Class (commenced operations on January 14, 2000)
2009 $ 10.40 $ 0.35 $ 0.18 $ (0.35) $ -- $ 10.58
2008 10.33 0.42 0.08 (0.43) -- 10.40
2007 10.28 0.46 0.05 (0.46) -- 10.33
2006 10.40 0.41 (0.12) (0.41) -- 10.28
2005 10.62 0.31 (0.16) (0.31) (0.06) 10.40
Class N (commenced operations on April 13, 2000)
2009 $ 10.42 $ 0.32 $ 0.18 $ (0.32) $ -- $ 10.60
2008 10.35 0.40 0.07 (0.40) -- 10.42
2007 10.30 0.44 0.04 (0.43) -- 10.35
2006 10.42 0.39 (0.12) (0.39) -- 10.30
2005 10.64 0.29 (0.17) (0.28) (0.06) 10.42
- ---------------------------------------------------------------------------------------------
California Tax Exempt Bond Fund
Institutional Class (commenced operations on January 14, 2000)
2009 $ 10.06 $ 0.33 $ 0.51 $ (0.33) $ -- $ 10.57
2008 10.24 0.32 (0.18) (0.32) -- 10.06
2007 10.25 0.31 (0.01) (0.31) -- 10.24
2006 10.26 0.29 0.03 (0.29) (0.04) 10.25
2005 10.41 0.28 (0.11) (0.28) (0.04) 10.26
Class N (commenced operations on April 13, 2000)
2009 $ 10.09 $ 0.30 $ 0.51 $ (0.30) $ -- $ 10.60
2008 10.27 0.30 (0.18) (0.30) -- 10.09
2007 10.27 0.28 -- (0.28) -- 10.27
2006 10.29 0.26 0.02 (0.26) (0.04) 10.27
2005 10.44 0.25 (0.11) (0.25) (0.04) 10.29
- ---------------------------------------------------------------------------------------------
High Yield Bond Fund
Institutional Class (commenced operations on January 14, 2000)
2009 $ 7.40 $ 0.62 $ 0.18 $ (0.64) $ -- $ 7.56
2008 8.91 0.64 (1.47) (0.68) -- 7.40
2007 8.96 0.70 (0.06) (0.69) -- 8.91
2006 9.04 0.68 (0.08) (0.68) -- 8.96
2005 9.31 0.71 (0.27) (0.71) -- 9.04
Class N (commenced operations on January 14, 2000)
2009 $ 7.40 $ 0.60 $ 0.18 $ (0.62) $ -- $ 7.56
2008 8.91 0.62 (1.47) (0.66) -- 7.40
2007 8.96 0.68 (0.07) (0.66) -- 8.91
2006 9.04 0.65 (0.08) (0.65) -- 8.96
2005 9.31 0.69 (0.27) (0.69) -- 9.04
RATIO
TO EXPENSES
RATIO TO AVERAGE
NET OF NET NET ASSET
ASSETS RATIO INVESTMENT (EXCLUDING
END OF EXPENSES INCOME WAIVERS & PORTFOLIO
TOTAL OF PERIOD TO AVERAGE TO AVERAGE RECOVERED TURNOVER
RETURN++ (000) NET ASSETS(1)(2) NET ASSETS(1) FEES)(1) RATE
- ------------------------------------------------------------------------------------------------
Corporate Bond Fund
Institutional Class (commenced operations on January 14, 2000)
2009 12.48% $ 88,897 0.74% 3.88% 0.75% 30%
2008 0.04 69,709 0.73 4.25 0.74 12
2007 4.57 62,210 0.74 4.39 0.75 30
2006 3.19 55,290 0.75 4.14 0.75 25
2005 1.26 51,193 0.75 3.80 0.76 25
Class N (commenced operations on April 13, 2000)
2009 12.19% $ 995 0.99% 3.59% 1.00% 30%
2008 (0.11) 608 0.98 4.02 0.99 12
2007 4.30 1,043 0.99 4.13 1.00 30
2006 2.93 1,332 1.00 3.88 1.00 25
2005 0.91 1,530 1.00 3.55 1.01 25
- ------------------------------------------------------------------------------------------------
Government Bond Fund
Institutional Class (commenced operations on January 14, 2000)
2009 5.18% $ 71,966 0.70% 3.29% 0.77% 85%
2008 4.87 66,097 0.70 4.05 0.77 36
2007 5.04 52,606 0.70 4.50 0.77 83
2006 2.89 35,671 0.70 4.04 0.78 62
2005 1.42 28,132 0.70 2.98 0.79 58
Class N (commenced operations on April 13, 2000)
2009 4.91% $ 3,109 0.95% 3.04% 1.02% 85%
2008 4.59 2,761 0.95 3.80 1.02 36
2007 4.77 2,632 0.95 4.25 1.02 83
2006 2.63 1,782 0.95 3.81 1.03 62
2005 1.16 554 0.95 2.70 1.04 58
- ------------------------------------------------------------------------------------------------
California Tax Exempt Bond Fund
Institutional Class (commenced operations on January 14, 2000)
2009 8.45% $ 38,581 0.50% 3.18% 0.61% 50%
2008 1.38 34,262 0.50 3.13 0.61 55
2007 2.98 33,804 0.50 3.04 0.62 43
2006 3.18 26,074 0.50 2.85 0.62 43
2005 1.65 22,768 0.50 2.70 0.63 54
Class N (commenced operations on April 13, 2000)
2009 8.15% $ 1,902 0.75% 2.92% 0.87% 50%
2008 1.12 1,049 0.75 2.87 0.86 55
2007 2.82 922 0.75 2.78 0.87 43
2006 2.81 1,134 0.75 2.59 0.87 43
2005 1.39 1,487 0.75 2.43 0.88 54
- ------------------------------------------------------------------------------------------------
High Yield Bond Fund
Institutional Class (commenced operations on January 14, 2000)
2009 12.94% $ 16,355 1.00% 9.75% 1.10% 59%
2008 (9.83) 13,926 1.00 7.72 1.09 20
2007 7.27 17,137 1.00 7.73 1.10 26
2006 6.90 20,887 1.00 7.58 1.10 23
2005 4.85 22,588 1.00 7.71 1.11 46
Class N (commenced operations on January 14, 2000)
2009 12.61% $ 19,637 1.30% 9.43% 1.40% 59%
2008 (10.10) 17,521 1.30 7.43 1.39 20
2007 6.95 20,121 1.30 7.44 1.40 26
2006 6.58 20,045 1.30 7.28 1.40 23
2005 4.54 21,028 1.30 7.41 1.41 46
- ----------
+ PER SHARE CALCULATIONS ARE BASED ON THE AVERAGE SHARES OUTSTANDING
THROUGHOUT THE PERIOD.
++ RETURNS ARE FOR THE PERIOD INDICATED AND HAVE NOT BEEN ANNUALIZED. FEE
WAIVERS ARE IN EFFECT; IF THEY HAD NOT BEEN IN EFFECT, PERFORMANCE WOULD
HAVE BEEN LOWER. RETURNS SHOWN DO NOT REFLECT THE DEDUCTION OF TAXES THAT
A SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND
SHARES.
(1) ANNUALIZED FOR PERIODS LESS THAN ONE YEAR.
(2) RATIO INCLUDES WAIVERS AND PREVIOUSLY WAIVED INVESTMENT ADVISORY FEES
RECOVERED.THE IMPACT OF THE RECOVERED FEES MAY CAUSE A HIGHER NET EXPENSE
RATIO. AMOUNTS DESIGNATED AS "--" ARE EITHER $0 OR HAVE BEEN ROUNDED TO
$0.
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
FOR THE YEAR/PERIOD ENDED SEPTEMBER 30,
- --------------------------------------------------------------------------------
RATIO
OF EXPENSES
RATIO TO AVERAGE
NET NET NET OF NET NET ASSETS
ASSET DIVIDENDS ASSET ASSETS RATIO INVESTMENT (EXCLUDING
VALUE NET FROM NET VALUE END OF EXPENSES INCOME WAIVERS &
BEGINNING INVESTMEIT NVESTMENT END TOTAL OF PERIOD TO AVERAGE TO AVERAGE RECOVERED
OF PERIOD INCOME INCOME OF PERIOD RETURN++ (000) NET ASSETS(1)(2) NET ASSETS(1) FEES)(1)
- ---------------------------------------------------------------------------------------------------------------------------------
PRIME MONEY MARKET FUND
Institutional Class (commenced operations on March 23, 1998)
2009 $ 1.00 $ 0.005 $ (0.005) $ 1.00 0.46% $ 543,326 0.44% 0.46% 0.65%
2008 1.00 0.030 (0.030) 1.00 3.01 532,931 0.58 2.90 0.58
2007 1.00 0.047 (0.047) 1.00 4.85 438,639 0.59 4.74 0.60
2006 1.00 0.041 (0.041) 1.00 4.17 388,171 0.59 4.12 0.60
2005 1.00 0.021 (0.021) 1.00 2.10 332,393 0.60 2.05 0.61
Class N (commenced operations on October 18, 1999)
2009 $ 1.00 $ 0.003 $ (0.003) $ 1.00 0.33% $ 656,769 0.61% 0.39% 1.15%
2008 1.00 0.027 (0.027) 1.00 2.78 1,123,900 0.80 2.65 1.08
2007 1.00 0.045 (0.045) 1.00 4.62 870,537 0.81 4.52 1.10
2006 1.00 0.039 (0.039) 1.00 3.94 640,366 0.81 3.95 1.10
2005 1.00 0.019 (0.019) 1.00 1.87 312,452 0.82 1.94 1.11
Class S (commenced operations on October 26, 1999)
2009 $ 1.00 $ 0.002 $ (0.002) $ 1.00 0.23% $ 372,762 0.73% 0.28% 1.15%
2008 1.00 0.025 (0.025) 1.00 2.57 633,815 1.00 2.54 1.08
2007 1.00 0.043 (0.043) 1.00 4.41 620,195 1.01 4.32 1.10
2006 1.00 0.037 (0.037) 1.00 3.73 324,353 1.01 3.74 1.10
2005 1.00 0.017 (0.017) 1.00 1.67 203,502 1.02 1.70 1.11
- ---------------------------------------------------------------------------------------------------------------------------------
GOVERNMENT MONEY MARKET FUND
Institutional Class (commenced operations on April 3, 2000)
2009 $ 1.00 $ 0.003 $ (0.003) $ 1.00 0.27% $ 123,863 0.36% 0.26% 0.65%
2008 1.00 0.027 (0.027) 1.00 2.72 100,674 0.59 2.62 0.59
2007 1.00 0.047 (0.047) 1.00 4.77 47,858 0.60 4.67 0.61
2006 1.00 0.040 (0.040) 1.00 4.08 52,782 0.60 4.11 0.61
2005 1.00 0.020 (0.020) 1.00 2.05 32,039 0.61 1.97 0.62
Class N (commenced operations on June 21, 1999)
2009 $ 1.00 $ 0.002 $ (0.002) $ 1.00 0.19% $2,549,147 0.47% 0.21% 1.13%
2008 1.00 0.025 (0.025) 1.00 2.49 3,006,935 0.81 2.40 1.09
2007 1.00 0.044 (0.044) 1.00 4.54 2,291,138 0.82 4.45 1.11
2006 1.00 0.038 (0.038) 1.00 3.86 1,940,602 0.82 3.78 1.11
2005 1.00 0.018 (0.018) 1.00 1.82 1,895,412 0.83 1.80 1.12
Class S (commenced operations on October 6, 1999)
2009 $ 1.00 $ 0.001 $ (0.001) $ 1.00 0.12% $ 298,842 0.54% 0.13% 1.13%
2008 1.00 0.023 (0.023) 1.00 2.29 408,747 1.02 2.23 1.09
2007 1.00 0.042 (0.042) 1.00 4.33 321,061 1.02 4.24 1.11
2006 1.00 0.036 (0.036) 1.00 3.65 232,083 1.02 3.60 1.11
2005 1.00 0.016 (0.016) 1.00 1.62 227,905 1.03 1.61 1.12
- ---------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT MONEY MARKET FUND
Institutional Class (commenced operations on April 3, 2000)
2009 $ 1.00 $ 0.003 $ (0.003) $ 1.00 0.33% $ 141,579 0.30% 0.31% 0.65%
2008 1.00 0.018 (0.018) 1.00 1.80 157,427 0.55 1.69 0.61
2007 1.00 0.030 (0.030) 1.00 3.01 89,237 0.55 2.97 0.62
2006 1.00 0.026 (0.026) 1.00 2.62 85,014 0.55 2.60 0.62
2005 1.00 0.015 (0.015)* 1.00 1.51 73,211 0.55 1.46 0.63
Class N (commenced operations on June 21, 1999)
2009 $ 1.00 $ 0.002 $ (0.002) $ 1.00 0.23% $ 704,840 0.41% 0.25% 1.16%
2008 1.00 0.016 (0.016) 1.00 1.57 880,794 0.78 1.47 1.11
2007 1.00 0.027 (0.027) 1.00 2.78 695,318 0.78 2.73 1.12
2006 1.00 0.024 (0.024) 1.00 2.39 631,478 0.78 2.36 1.12
2005 1.00 0.013 (0.013)* 1.00 1.28 569,671 0.78 1.25 1.13
Class S (commenced operations on November 12, 1999)
2009 $ 1.00 $ 0.002 $ (0.002) $ 1.00 0.17% $ 74,396 0.54% 0.26% 1.16%
2008 1.00 0.014 (0.014) 1.00 1.37 141,757 0.98 1.40 1.11
2007 1.00 0.025 (0.025) 1.00 2.57 178,918 0.98 2.55 1.12
2006 1.00 0.022 (0.022) 1.00 2.18 107,131 0.98 2.17 1.12
2005 1.00 0.011 (0.011)* 1.00 1.08 88,182 0.98 1.09 1.13
- ----------
* INCLUDES A REALIZED CAPITAL GAIN DISTRIBUTION OF LESS THAN $0.001.
++ RETURNS ARE FOR THE PERIOD INDICATED AND HAVE NOT BEEN ANNUALIZED. FEE
WAIVERS ARE IN EFFECT; IF THEY HAD NOT BEEN IN EFFECT, PERFORMANCE WOULD
HAVE BEEN LOWER. RETURNS SHOWN DO NOT REFLECT THE DEDUCTION OF TAXES THAT A
SHAREHOLDER WOULD PAY ON FUND DISTRIBUTIONS OR THE REDEMPTION OF FUND
SHARES.
(1) ANNUALIZED FOR PERIODS LESS THAN ONE YEAR.
(2) RATIO INCLUDES WAIVERS AND PREVIOUSLY WAIVED INVESTMENT ADVISORY FEES
RECOVERED.THE IMPACT OF THE RECOVERED FEES MAY CAUSE A HIGHER NET EXPENSE
RATIO.
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS.
CNI CHARTER FUNDS | PAGE 74
notes to financial statements
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
1. ORGANIZATION:
CNI Charter Funds, a Delaware statutory trust (the "Trust"), is registered under
the Investment Company Act of 1940, as amended, as an open-end management
investment company with 17 portfolios.The financial statements included herein
are those of the Large Cap Value Equity Fund, Large Cap Growth Equity Fund, RCB
Small Cap Value Fund, Opportunistic Value Fund (collectively, the "Equity
Funds"); Corporate Bond Fund, Government Bond Fund, California Tax Exempt Bond
Fund, High Yield Bond Fund (collectively, the "Fixed Income Funds"); Prime Money
Market Fund, Government Money Market Fund, California Tax Exempt Money Market
Fund (collectively, the "Money Market Funds"); and Multi-Asset Fund (each a
"Fund," collectively, the "Funds").The Equity and Fixed Income Funds and the
Multi-Asset Fund are registered to offer Institutional and Class N Shares; in
addition, the Opportunistic Value Fund is registered to offer Class E Shares and
the RCB Small Cap Value Fund is registered to offer Class R Shares.The Money
Market Funds are registered to offer Institutional, Class N and Class S
Shares.The assets of each Fund are segregated, and a shareholder's interest is
limited to the Fund in which shares are held.The Funds' prospectuses provide
descriptions of each Fund's investment objectives, policies and strategies.
Class N and Institutional Class shares of the Multi-Asset Fund commenced
operations on October 1, 2007.
Class E, Class N and Institutional Class shares of the Opportunistic Value Fund
commenced operations on June 26, 2008.
Effective January 31, 2008, Class A shares of the Funds were redesignated as
Class N shares.There were no changes to the rights, fees or expenses of the
Class A shares or services provided to Class A shareholders in connection with
the change in designation to Class N.
2. SIGNIFICANT ACCOUNTING POLICIES:
The following is a summary of significant accounting policies followed by the
Funds.
FINANCIAL ACCOUNTING STANDARDS BOARD ("FASB") LAUNCHES ACCOUNTING STANDARDS
CODIFICATION -- The FASB has issued FASB ASC 105 (formerly FASB Statement No.
168) THE "FASB ACCOUNTING STANDARDS CODIFICATION(TM)" AND THE HIERARCHY OF
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES ("ASC 105"). ASC 105 established the
FASB Accounting Standards Codification(TM) ("Codification" or "ASC") as the
single source of authoritative U.S. generally accepted accounting principles
("GAAP") recognized by the FASB to be applied by nongovernmental entities. Rules
and interpretive releases of the Securities and Exchange Commission ("SEC")
under authority of federal securities laws are also sources of authoritative
GAAP for SEC registrants.The Codification supersedes all existing non-SEC
accounting and reporting standards.All other non-grandfathered, non-SEC
accounting literature not included in the Codification will become
non-authoritative.
Following the Codification, the FASB will not issue new standards in the form of
Statements, FASB Staff Positions or Emerging Issues Task Force Abstracts.
Instead, it will issue Accounting Standards Updates, which will serve to update
the Codification, provide background information about the guidance and provide
the basis for conclusions on the changes to the Codification.
GAAP is not intended to be changed as a result of the FASB's Codification
project, but it will change the way the guidance is organized and presented.As a
result, these changes will have a significant impact on how companies reference
GAAP in their financial statements and in their accounting policies for
financial statements issued for interim and annual periods ending after
September 15, 2009.The Trust has implemented the Codification as of September
30, 2009.
USE OF ESTIMATES -- The preparation of financial statements in conformity with
U.S. generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of increases and decreases in
net assets from operations during the reporting period.Actual results could
differ from those estimates.
SECURITY VALUATION -- Securities listed on a securities exchange, market or
automated quotation system for which quotations are readily available (except
for securities traded on NASDAQ) are valued at the last quoted sale price on the
primary exchange or market (foreign or domestic) on which they are traded, or,
if there is no such reported sale, at the most recent quoted bid price. For
securities traded on NASDAQ, the NASDAQ Official Closing Price is used. If
available, debt securities are priced based upon valuations provided by
independent, third-party pricing agents. Such values generally reflect the last
reported sales price if the security is actively traded.The third-party pricing
agents may also value debt securities at an evaluated bid price by employing
methodologies that utilize actual market transactions, broker-supplied
valuations, or other methodologies designed to identify the market value for
such securities. Debt obligations, including money market funds, with remaining
maturities of sixty days or less may be valued at their amortized cost, which
approximates market value.The prices for foreign securities are reported in
local currency and converted to U.S. dollars using currency exchange rates.
Investments in registered
CNI CHARTER FUNDS | PAGE 75
notes to financial statements
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
investment companies are priced at the Fund's daily net asset value. Prices for
most securities held in the Funds are provided daily by recognized independent
pricing agents. If a security price cannot be obtained from an independent,
third-party pricing agent, the Funds seek to obtain a bid price from at least
one independent broker.
Securities for which market prices are not "readily available" are valued in
accordance with Fair Value Procedures established by the Funds' Board of
Trustees.The Funds' Fair Value Procedures are implemented through a Fair Value
Committee (the "Committee") designated by the Funds' Board of Trustees. Some of
the more common reasons that may necessitate that a security be valued using
Fair Value Procedures include: the security's trading has been halted or
suspended; the security has been de-listed from a national exchange; the
security's primary trading market is temporarily closed at a time when under
normal conditions it would be open; for international securities, market events
occur after the close of the foreign markets that make closing prices not
representative of fair value; or the security's primary pricing source is not
able or willing to provide a price.When a security is valued in accordance with
the Fair Value Procedures, the Committee will determine the value after taking
into consideration relevant information reasonably available to the Committee.
ASC 820 (formerly known as FAS No. 157 "Fair Value Measurements") establishes a
fair value hierarchy and specifies that a valuation technique used to measure
fair value shall maximize the use of observable inputs and minimize the use of
unobservable inputs.The objective of a fair value measurement is to determine
the price that would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market participants at the
measurement date (an exit price). Accordingly, the fair value hierarchy gives
the highest priority to quoted prices (unadjusted) in active markets for
identical assets or liabilities (Level 1) and the lowest priority to
unobservable inputs (Level 3).The three levels of the fair value hierarchy under
ASC 820 are described below:
o Level 1 -- Unadjusted quoted prices in active markets for identical,
unrestricted assets or liabilities that the Funds have the ability to
access at the measurement date;
o Level 2 -- Quoted prices which are not active, or inputs that are
observable (either directly or indirectly) for substantially the full
term of the asset or liability; and
o Level 3 -- Prices, inputs or exotic modeling techniques which are both
significant to the fair value measurement and unobservable (supported
by little or no market activity).
As required by ASC 820, investments are classified within the level of the
lowest significant input considered in determining fair value. Investments
classified within Level 3 whose fair value
measurement considers several inputs may include Level 1 or Level 2 inputs as
components of the overall fair value measurement. For the year ended September
30, 2009, there have been no significant changes to the Funds' fair valuation
methodologies.
SECURITY TRANSACTIONS AND RELATED INCOME -- Security transactions are accounted
for on the trade date of the security purchase or sale. Costs used in
determining net realized capital gains and losses on the sale of securities are
those of the specific securities sold. Interest income is recognized on an
accrual basis and dividend income is recognized on the ex-dividend date.
Purchase discounts and premiums on securities held by the Funds are accreted and
amortized to maturity using the scientific method, which approximates the
effective interest method over the holding period of a security, except for the
Money Market funds which use a straight line basis.
REPURCHASE AGREEMENTS -- Securities pledged as collateral for repurchase
agreements are held by each Fund's custodian bank, U.S. Bank, N.A., until
maturity of the repurchase agreements. Provisions of the agreements and
procedures adopted by the investment adviser require that the market value of
the collateral, including accrued interest thereon, is sufficient in the event
of default by the counterparty.The Funds also invest in tri-party repurchase
agreements. Securities held as collateral for tri-party repurchase agreements
are maintained by the broker's custodian bank in a segregated account until
maturity of the repurchase agreement. Provisions of the agreements require that
the market value of the collateral, including accrued interest thereon, is
sufficient in the event of default. If the counterparty defaults and the value
of the collateral declines or if the counterparty enters into an insolvency
proceeding, realization of the collateral by the Fund may be delayed or limited.
TBA TRANSACTIONS -- The Funds may engage in "to be announced" ("TBA") security
transactions. Such transactions involve a commitment by the Funds to purchase or
sell securities for a predetermined price or yield, with payment and delivery
taking place beyond the customary settlement period. The Funds record TBA
securities on the trade date and maintain security positions such that
sufficient liquid assets will be available to make payments for the securities
purchased.
EXPENSE ALLOCATION -- Common expenses incurred by the Funds are allocated among
the Funds (i) based upon relative average daily net assets, (ii) as incurred on
a specific identification basis, or (iii) equally among the Funds, depending on
the nature of the expenditure.
CLASSES -- Class-specific expenses are borne by that class. Income, non
class-specific expenses, and realized and unrealized gains/losses are allocated
to the respective class on the basis of relative net asset value each day.
CNI CHARTER FUNDS | PAGE 76
- --------------------------------------------------------------------------------
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS -- Dividends from net investment
income are declared daily and paid to shareholders monthly for the Fixed Income
and Money Market Funds. Dividends from net investment income are declared and
paid quarterly for the Large Cap Value Equity, Large Cap Growth Equity,
Opportunistic Value and Multi-Asset Funds. For the RCB Small Cap Value Fund,
dividends from net investment income are declared and paid annually.
Distributions from net realized capital gains are distributed to shareholders at
least annually.
DEFERRED OFFERING COSTS -- All offering costs incurred with the start up of a
Fund are being amortized on a straight line basis over a period of twelve months
from commencement of operations.As of September 30, 2009, the Opportunistic
Value Fund deferred offering costs were fully amortized.
3. ADMINISTRATION,TRANSFER AGENT, DISTRIBUTION AND SHAREHOLDER SERVICES
AGREEMENTS:
Pursuant to an administration agreement dated April 1, 1999, as amended April 1,
2008 (the "Agreement"), SEI Investments Global Funds Services (the
"Administrator"), a wholly owned subsidiary of SEI Investments Company, acts as
the Trust's administrator. Under the terms of the Agreement, the Administrator
is entitled to receive an annual fee of 0.065% of aggregate average daily net
assets of the Trust not exceeding $2.5 billion, 0.045% of aggregate average
daily net assets of the Trust exceeding $2.5 billion but not exceeding $5
billion, 0.025% of aggregate average daily net assets of the Trust exceeding $5
billion but not exceeding $7.5 billion, and 0.02% of aggregate average daily net
assets of the Trust exceeding $7.5 billion. Each Fund is subject to a minimum
annual fee of $90,000, which may be reduced at the sole discretion of the
Administrator.
The Trust has adopted a Rule 12b-1 Distribution Plan ("the Plan") with respect
to Class N, Class S and Class R Shares that allows each Fund to pay distribution
and servicing fees. SEI Investments Distribution Co. (the "Distributor")
receives a distribution fee, computed daily and paid monthly, at the annual rate
of 0.50% of the average daily net assets of the Class N Shares and Class S
Shares of the Money Market Funds and 0.25% of the Class N Shares of the Equity
Funds, Fixed Income Funds and the Multi-Asset Fund and the Class R Shares of the
RCB Small Cap Value Fund, with the exception of 0.30% charged to the Class N
Shares of the High Yield Bond Fund, which may be used by the Distributor to
provide compensation for sales support and distribution-related activities.
The RCB Small Cap Equity Fund Class R shares ceased accruing 25 basis points in
12b-1 fees from January 1, 2008 to September 30, 2009 in order to use excess
12b-1 fees held by the Fund and its Distributor.The excess 12b-1 fees that were
held by the Distributor as of December 31, 2008 were reimbursed to the RCB Small
Cap Equity Fund Class R on February 27, 2009.
The Trust and the Distributor are parties to a distribution agreement dated
April 1, 1999.
SEI Institutional Transfer Agency, a division of SEI Investments Fund Management
Corporation (the "Transfer Agent"), serves as transfer agent for the Trust and
provides services at an annual rate of $15,000 per share class.The Transfer
Agent has agreed to waive these fees.The Class R shares of the RCB Small Cap
Value Fund began paying the sub-transfer agent, Citigroup Fund Services, LLC,
fees commencing February 1, 2008.
The Trust has entered into Shareholder Servicing Agreements that permit payment
of compensation to City National Bank ("CNB") and its affiliates, which provide
certain shareholder support for their customers who own Institutional Class,
Class N, Class S or Class R Shares. In consideration for such services, a
shareholder servicing fee is charged at the annual rate of up to 0.25% of each
Fund's average daily net assets. CNB has agreed to voluntarily waive portions of
its shareholder servicing fees with respect to certain Funds. For the year ended
September 30, 2009, CNB received Shareholder Servicing fees from the Trust in
the amount of $13,452,291.
Certain officers of the Trust are also officers of
City National Asset Management, Inc. ("CNAM, Inc." or the "Adviser") or the
Administrator. Such officers are paid no fees by the Trust for serving as
officers of the Trust.
4. INVESTMENT ADVISORY FEES AND OTHER AGREEMENTS:
CNAM, Inc., a wholly owned subsidiary of CNB, serves as the investment manager
for the Funds. Under the terms of the current agreement, the Adviser receives an
annual fee equal to 0.62% of the average daily net assets of the Large Cap Value
Equity Fund, 0.65% of the average daily net assets of the Large Cap Growth
Equity Fund, 0.85% of the average net assets of the RCB Small Cap Value Fund,
0.50% of the average daily net assets of the Opportunistic Value Fund, 0.50% of
the average daily net assets of the Multi-Asset Fund, 0.40% of the average daily
net assets of the Corporate Bond Fund, 0.43% of the average daily net assets of
the Government Bond Fund, 0.27% of the average daily net assets of the
California Tax Exempt Bond Fund, 0.75% of the average daily net assets of the
High Yield Bond Fund, 0.25% of the average daily net assets of the Prime Money
Market Fund, 0.26% of the average daily net assets of the Government Money
Market Fund, and 0.27% of the average daily net assets of the California Tax
Exempt Money Market Fund.
CNICHARTER FUNDS | PAGE 77
notes to financial statements
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
REED, CONNER & BIRDWELL, LLC acts as the investment sub-adviser with respect to
the RCB Small Cap Value Fund.
Effective April 15, 2009, GUGGENHEIM INVESTMENT MANAGEMENT, LLC replaced Halbis
Capital Management (USA), Inc. as the investment sub-adviser to the High Yield
Bond Fund.
SKBA CAPITAL MANAGEMENT, LLC acts as the investment sub-adviser with respect to
the Opportunistic Value Fund.
Sub-adviser fees are paid by the Adviser.
The Adviser has voluntarily agreed to limit its fees or reimburse expenses to
the extent necessary to keep operating expenses at or below certain percentages
of the Funds' respective average daily net assets. In the case of the RCB Small
Cap Value Fund and the Opportunistic Value Fund, the Fund's sub-adviser has
contractually agreed to limit its fees or reimburse expenses to meet the expense
limitations.The expense limitations (expressed as percentages of average daily
net assets) are as follows:
Large Cap Large Cap RCB
Value Growth Small Cap Opportunistic
Equity Equity Value Value
Fund Fund Fund Fund
- -----------------------------------------------------------------------------
Institutional Class 1.00% 1.05% 1.24% 1.00%
Class N 1.25% 1.30% 1.49% 1.25%
Class E -- -- -- 0.75%
Class R -- -- 1.49% --
- -----------------------------------------------------------------------------
California
Multi- Corporate Government Tax Exempt
Asset Bond Bond Bond
Fund Fund Fund Fund
- -----------------------------------------------------------------------------
Institutional Class 1.75% 0.75% 0.70% 0.50%
Class N 2.00% 1.00% 0.95% 0.75%
- -----------------------------------------------------------------------------
California
High Yield Prime Government Tax Exempt
Bond Money Market Money Market Money Market
Fund Fund Fund Fund
- --------------------------------------------------------------------------------
Institutional Class 1.00% 0.63% 0.63% 0.55%
Class N 1.30% 0.85% 0.85% 0.78%
Class S -- 1.05% 1.05% 0.98%
- --------------------------------------------------------------------------------
Any fee reductions or expense reimbursements may be repaid to the Adviser (or
relevant sub-adviser, as applicable) within three years after occurrence,
subject to certain restrictions and only if such repayments do not cause the
Funds' expense ratios, at the time of repayment, to exceed the amounts shown in
the preceding table.
During the year ended September 30, 2009, the Board of Trustees approved the
reimbursement of previously waived fees by the Adviser in the amount of $1,479
in the Opportunistic Value Fund.
As of September 30, 2009, fees which were previously waived by the Adviser (or
relevant sub-adviser, as applicable) which may be subject to possible future
reimbursement to the Adviser (or relevant sub-adviser, as applicable) were as
follows:
Potential Amount of
Fund Recovery (000) Expiration
- ------------------------------------------------------------------------
Corporate Bond $ 2 2012
Government Bond 31 2010
39 2011
49 2012
California Tax Exempt Bond 34 2010
34 2011
39 2012
High Yield Bond 35 2010
29 2011
25 2012
Prime Money Market 880 2012
Government Money Market 2,210 2012
California Tax Exempt Money Market 494 2010
583 2011
1,568 2012
The Adviser, Administrator and Distributor have voluntarily agreed to further
waive and reduce their fees and/or reimburse certain expenses of the Money
Market Funds in order to maintain a one-day net income yield (yield floor) of
the Funds of not less than 0.01% of the Funds' average daily net assets.The
following table shows waivers, with respect to such yield floor, by class for
the year ended September 30, 2009:
Shareholder Investment Administration
Servicing Fee Advisor Fee Fee
Waiver Waiver Waiver
(000) (000) (000)
- ---------------------------------------------------------------------------------
Prime Money Market
Institutional Class $ 869 $ 300 $ 29
Class N 1,918 374 37
Class S 1,558 206 19
- ---------------------------------------------------------------------------------
Government Money Market
Institutional Class 258 101 7
Class N 8,803 1,855 138
Class S 1,684 254 18
- ---------------------------------------------------------------------------------
California Tax Exempt Money Market
Institutional Class 386 167 11
Class N 2,704 707 43
Class S 365 63 4
- ---------------------------------------------------------------------------------
5. INVESTMENT TRANSACTIONS:
The cost of security purchases and proceeds from the sale and maturities of
securities, other than temporary investments in short-term securities for the
year ended September 30, 2009, were as follows for the Equity Funds, Multi-Asset
Fund and Fixed Income Funds:
Purchases Sales and Maturities
- -----------------------------------------------------------------------------
U.S. Gov't Other U.S.Gov't Other
Fund (000) (000) (000) (000)
- -----------------------------------------------------------------------------
Large Cap Value Equity $ -- $ 14,899 $ -- $ 13,903
Large Cap Growth Equity -- 4,096 -- 7,239
RCB Small Cap Value -- 11,055 -- 16,995
Opportunistic Value -- 29,693 -- 41,656
Multi-Asset -- 14,687* 2,145 13,571*
Corporate Bond 545 43,348 3,736 17,010
Government Bond 63,456 2,164 51,811 7,114
California Tax Exempt Bond -- 20,585 -- 17,549
High Yield Bond -- 17,687 -- 15,723
* INCLUDES $385(000) AND $986(000) OF PURCHASES AND SALES, RESPECTIVELY, OF
AFFILIATED INVESTMENT COMPANIES.
CNI CHARTER FUNDS | PAGE 78
6. FEDERAL TAX INFORMATION:
It is each Fund's intention to continue to qualify as a regulated investment
company for Federal income tax purposes and distribute all of its taxable income
and net capital gains. Accordingly, no provisions for Federal income taxes are
required.
Management has analyzed the Funds' tax position taken on federal income tax
returns for all open tax years and has concluded that as of September 30, 2009,
no provision for income tax would be required in the Funds' financial
statements.The Funds' federal and state income and federal excise tax returns
for tax years for which the applicable statutes of limitations have not expired
are subject to examination by the Internal Revenue Service and state departments
of revenue.
The Funds may be subject to taxes imposed by countries in which they invest,
with respect to their investments in issuers existing or operating in such
countries. Such taxes are generally based on income earned.The Funds accrue such
taxes when the related income is earned.
The timing and characterization of certain income and capital gains
distributions are determined annually in accordance with Federal tax
regulations, which may differ from accounting principles generally accepted in
the United States of America. As a result, net investment income (loss) and net
realized gain (loss) on investment transactions for a reporting period may
differ significantly from distributions during such period. These book/tax
differences may be temporary or permanent. To the extent these differences are
permanent in nature, they are charged or credited to undistributed net
investment income (loss), accumulated net realized gain (loss), or paid-in
capital, as appropriate, in the period that the differences arise. Accordingly,
the following permanent differences, primarily attributable to REIT adjustments,
corporate action adjustments, realized gains (losses) on paydowns and timing of
distributions and investments in partnerships, were reclassified to/from the
following accounts as of September 30, 2009:
Increase Increase
(Decrease) (Decrease)
Undistributed Accumulated
Net Investment Net Realized
Income (Loss) Gain (Loss)
Fund (000) (000)
- -------------------------------------------------------
RCB Small Cap Value $ 22 $ (22)
Multi-Asset 10 (10)
Corporate Bond (1) 1
Government Bond 30 (30)
Prime Money Market 87 (87)
Government Money Market 16 (16)
- -------------------------------------------------------
These reclassifications had no effect on net assets or net asset value per
share.
The tax character of dividends and distributions declared during the years ended
September 30, 2009 and September 30, 2008 are shown below:
Tax
Exempt Ordinary Long-term
Income Income Capital Gain Total
Fund (000) (000) (000) (000)
- ----------------------------------------------------------------------------
Large Cap Value Equity
2009 $ -- $ 1,495 $ -- $ 1,495
2008 -- 1,828 5,488 7,316
Large Cap Growth Equity
2009 -- 222 -- 222
2008 -- 152 -- 152
RCB Small Cap Value
2009 -- 439 -- 439
2008 -- 3,067 6,538 9,605
Opportunistic Value
2009 -- 503 -- 503
2008 -- -- -- --
Multi-Asset
2009 -- 375 -- 375
2008 -- 473 -- 473
Corporate Bond
2009 -- 2,952 -- 2,952
2008 -- 2,888 -- 2,888
Government Bond
2009 -- 2,435 -- 2,435
2008 -- 2,639 -- 2,639
California Tax Exempt Bond
2009 1,151 -- -- 1,151
2008 1,063 -- -- 1,063
High Yield Bond
2009 -- 2,755 -- 2,755
2008 -- 2,806 -- 2,806
Prime Money Market
2009 -- 7,503 -- 7,503
2008 -- 61,899 -- 61,899
Government Money Market
2009 -- 6,635 -- 6,635
2008 -- 73,655 -- 73,655
California Tax Exempt
Money Market
2009 2,953 -- -- 2,953
2008 17,064 11 -- 17,075
CNI CHARTER FUNDS | PAGE 79
notes to financial statements
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
As of September 30, 2009, the components of Distributable Earnings/(Accumulated
Losses) on a tax basis were as follows:
Total
Distributable
Undistributed Undistributed Capital Unrealized Other Earnings
Tax-Exempt Ordinary Loss Post-October Appreciation Temporary (Accumulated
Income Income Carryforwards Losses (Depreciation) Differences Losses)
Fund (000) (000) (000) (000) (000) (000) (000)
- ----------------------------------------------------------------------------------------------------------------------------------
Large Cap Value Equity $ -- $ 322 $ (2,810) $ (7,763) $ (3,800) $ (321) $ (14,372)
Large Cap Growth Equity -- 37 (2,607) (1,454) 673 (37) (3,388)
RCB Small Cap Value -- 14 (589) (8,608) 3,746 -- (5,437)
Opportunistic Value -- 72 (2,050) (15,678) 7,145 (72) (10,583)
Multi-Asset -- 74 (2,309) (1,645) 876 (63) (3,067)
Corporate Bond -- 256 (541) (675) 3,654 (256) 2,438
Government Bond -- 167 (113) -- 1,236 (167) 1,123
California Tax Exempt Bond 101 -- (186) -- 1,432 (100) 1,245
High Yield Bond -- 264 (1,621) (2,936) (2,057) (264) (6,614)
Prime Money Market -- 321 -- -- -- (117) 204
Government Money Market -- 92 -- -- -- (71) 21
California Tax Exempt Money
Market 32 -- -- -- -- (31) 1
For tax purposes, the losses in the Funds can be carried forward for a maximum
of eight years to offset any future net realized capital gains. At September 30,
2009, the breakdown of capital loss carryforwards was as follows:
Expiring
September 30,
---------------------------------------------------------------
2010 2011 2012 2014 2015 2016 2017
Fund (000) (000) (000) (000) (000) (000) (000)
- -----------------------------------------------------------------------------------------
Large Cap Value Equity $ -- $ -- $ -- $ -- $ -- $ -- $2,810
Large Cap Growth Equity 82 1,844 227 -- -- -- 454
RCB Small Cap Value -- -- -- -- -- -- 589
Opportunistic Value -- -- -- -- -- -- 2,050
Multi-Asset -- -- -- -- -- -- 2,309
Corporate Bond -- -- -- 64 271 116 90
Government Bond -- -- -- -- 12 101 --
California Tax Exempt Bond -- -- -- -- 34 7 145
High Yield Bond -- 521 -- 268 -- -- 832
During the year ended September 30, 2009, the following Fund utilized capital
loss carryforwards to offset capital gains amounting to:
Amount
Fund (000)
- ----------------------------------
Government Bond $ 422
- ----------------------------------
Post-October losses represent losses realized on investments and foreign
currency transactions from November 1, 2008 through September 30, 2009 that, in
accordance with Federal income tax regulations, the Funds have elected to defer
and treat as having arisen in the following fiscal year.
The aggregate gross unrealized appreciation on securities, the aggregate gross
unrealized depreciation on securities and the net unrealized
appreciation/(depreciation) for tax purposes at September 30, 2009 for each of
the Equity and Fixed Income Funds and Multi-Asset Fund were as follows:
Aggregate Aggregate Net
Gross Gross Unrealized
Federal Unrealized Unrealized Appreciation
Tax Cost Appreciation Depreciation (Depreciation)
Fund (000) (000) (000) (000)
- ------------------------------------------------------------------------------------
Large Cap Value Equity $94,074 $ 8,337 $ (12,137) $ (3,800)
Large Cap Growth Equity 36,510 4,488 (3,815) 673
RCB Small Cap Value 19,907 6,146 (2,400) 3,746
Opportunistic Value 19,347 7,359 (214) 7,145
Multi Asset 23,817 1,424 (548) 876
Corporate Bond 84,819 3,721 (67) 3,654
Government Bond 73,451 1,263 (27) 1,236
California Tax Exempt Bond 39,050 1,454 (22) 1,432
High Yield Bond 37,256 1,202 (3,259) (2,057)
At September 30, 2009, the Money Market Funds' cost of securities for Federal
income tax purposes approximates the cost disclosed in the Schedule of
Investments.
7. CONCENTRATION OF CREDIT RISK
In the normal course of business, the Funds enter into contracts that provide
general indemnifications.The Funds' maximum exposure under these arrangements is
dependent on future claims that may be made against the Funds and, therefore,
cannot be established; however, based on experience, the risk of loss from such
claim is considered remote.
The Multi-Asset Fund may invest in exchange-traded notes ("ETNs") as a
non-principal investment strategy. ETNs are unsecured debt obligations of
investment banks which are traded on exchanges and the returns of which are
linked to the performance of market indexes. In addition to trading ETNs on
exchanges, investors may redeem ETNs directly with the issuer on a weekly basis,
typically in a minimum amount of 50,000 units, or hold the ETNs until maturity.
ETNs are riskier than ordinary unsecured debt securities and have no principal
protection.The Fund will generally invest in ETNs which are linked to
commodities indexes.The Fund's investment in an ETN may be influenced by many
unpredictable factors, including highly volatile commodities prices, changes in
supply and demand relationships, weather, agriculture, trade, changes in
interest rates, and monetary and other governmental policies, action and
inaction. Investing in ETNs is not equivalent to investing directly in index
CNI CHARTER FUNDS | PAGE 80
components or the relevant index itself. Because ETNs are debt securities, they
possess credit risk; if the issuer has financial difficulties or goes bankrupt,
the investor may not receive the return it was promised.
ASC 815 (formerly known as FAS No. 161 "Disclosures about Derivative Instruments
and Hedging Activities") was adopted by the Trust effective April 1, 2009. ASC
815 requires enhanced disclosures about the Funds' derivative and hedging
activities, including how such activities are accounted for and their effect on
the Funds' financial position, performance, and cash flows. For the year ended
September 30, 2009 there was no derivative activity requiring additional
disclosure.
CALIFORNIA TAX EXEMPT FUNDS -- SPECIFIC RISKS
The ability of issuers to pay interest on, and repay principal of, California
municipal securities may be affected by economic and political developments in
the State of California.
Certain securities are backed by letters of credit from various financial
institutions and financial guaranty assurance agencies. These letters of credit
enhance the credit quality of the individual securities; however, if any of the
financial institutions or financial guaranty assurance agencies' credit quality
should deteriorate, it could cause the individual security's credit quality to
change. Additionally, if any of the Funds concentrate their letters of credit in
any one financial institution, the risk of credit quality deterioration
increases.
8. CAPITAL SHARES ISSUED AND REDEEMED:
Capital share activity for the years ended September 30, 2009 and September 30,
2008 were as follows:
Large Cap Value Large Cap Growth RCB Small Cap Opportunistic
Equity Fund (000) Equity Fund (000) Value Fund (000) Value Fund (000)
----------------- ----------------- ----------------- ----------------
2009 2008 2009 2008 2009 2008 2009 2008
- ------------------------------------------------------- ----------------- ----------------- ----------------
CAPITAL SHARES ISSUED
AND REDEEMED:
INSTITUTIONAL CLASS:
Shares issued 3,207 2,441 1,140 638 54 43 24 --
Shares issued in Lieu of
Dividends and Distributions 150 469 9 6 3 55 -- --
Shares redeemed (2,904) (2,015) (1,395) (1,601) (37) (286) -- --
- ------------------------------------------------------- ----------------- ----------------- ----------------
Net Institutional
Class transactions 453 895 (246) (957) 20 (188) 24 --
======================================================= ================= ================= ================
CLASS N:
Shares issued 86 66 92 107 1 4 1 1
Shares issued in Lieu of
Dividends and Distributions 15 66 4 1 4 55 -- --
Shares redeemed (291) (246) (346) (274) (36) (116) -- --
- ------------------------------------------------------- ----------------- ----------------- ----------------
Net Class N transactions (190) (114) (250) (166) (31) (57) 1 1
======================================================= ================= ================= ================
CLASS R:
Shares issued -- -- -- -- 79 264 -- --
Shares issued in Lieu of
Dividends and Distributions -- -- -- -- 28 280 -- --
Shares redeemed -- -- -- -- (372) (704) -- --
- ------------------------------------------------------- ----------------- ----------------- ----------------
Net Class R transactions -- -- -- -- (265) (160) -- --
======================================================= ================= ================= ================
CLASS E:
Shares issued -- -- -- -- -- -- 3,743 4,863
Shares issued in Lieu of
Dividends and Distributions -- -- -- -- -- -- 93 --
Shares redeemed -- -- -- -- -- -- (4,671) --
- ------------------------------------------------------- ----------------- ----------------- ----------------
Net Class E transactions -- -- -- -- -- -- (835) 4,863
======================================================= ================= ================= ================
AMOUNTS DESIGNATED AS "--" ARE EITHER 0 OR HAVE BEEN ROUNDED TO 0.
CNI CHARTER FUNDS | PAGE 81
notes to financial statements
SEPTEMBER 30, 2009
8. CAPITAL SHARES ISSUED AND REDEEMED (CONTINUED):
California
Multi-Asset Corporate Bond Government Bond Tax Exempt Bond
Fund (000) Fund (000) Fund (000) Fund (000)
------------ --------------- --------------- ---------------
2009 2008 2009 2008 2009 2008 2009 2008
- ------------------------------------------------ --------------- --------------- ---------------
CAPITAL SHARES ISSUED
AND REDEEMED:
INSTITUTIONAL CLASS:
Shares issued 481 1,269 2,736 2,342 2,172 2,308 1,204 1,027
Shares issued in Lieu of
Dividends and Distributions 10 5 67 59 65 67 39 36
Shares redeemed (744) (167) (1,529) (1,372) (1,789) (1,109) (998) (958)
- ------------------------------------------------ --------------- --------------- ---------------
Net Institutional
Class transactions (253) 1,107 1,274 1,029 448 1,266 245 105
================================================ =============== =============== ===============
CLASS N:
Shares issued 359 1,916 48 4 101 74 132 76
Shares issued in Lieu of
Dividends and Distributions 12 11 1 2 4 4 1 --
Shares redeemed (387) (204) (17) (46) (77) (67) (58) (62)
- ------------------------------------------------ --------------- --------------- ---------------
Net Class N transactions (16) 1,723 32 (40) 28 11 75 14
================================================ =============== =============== ===============
California
High-Yield Prime Government Tax Exempt
Bond Money Market Money Market Money Market
Fund (000) Fund (000) Fund (000) Fund (000)
------------ ----------------------- ----------------------- -----------------------
2009 2008 2009 2008 2009 2008 2009 2008
- ------------------------------------------------ ----------------------- ----------------------- -----------------------
CAPITAL SHARES ISSUED
AND REDEEMED:
INSTITUTIONAL CLASS:
Shares issued 307 142 1,288,265 1,704,267 655,511 553,021 1,126,167 1,830,572
Shares issued in Lieu of
Dividends and Distributions 130 104 442 2,772 8 3 -- --
Shares redeemed (156) (288) (1,278,342) (1,612,805) (632,330) (500,209) (1,142,015) (1,762,382)
- ------------------------------------------------ ----------------------- ----------------------- -----------------------
Net Institutional
Class transactions 281 (42) 10,365 94,234 23,189 52,815 (15,848) 68,190
================================================ ======================= ======================= =======================
CLASS N:
Shares issued 405 193 2,117,635 3,333,223 4,478,647 6,290,498 1,708,583 2,477,610
Shares issued in Lieu of
Dividends and Distributions 158 121 1,555 13,996 4,161 43,391 1,814 9,947
Shares redeemed (334) (205) (2,586,377) (3,093,998) (4,940,602) (5,618,090) (1,886,349) (2,302,084)
- ------------------------------------------------ ----------------------- ----------------------- -----------------------
Net Class N transactions 229 109 (467,187) 253,221 (457,794) 715,799 (175,952) 185,473
================================================ ======================= ======================= =======================
CLASS S:
Shares issued -- -- 1,140,178 1,657,732 659,453 801,055 354,327 409,458
Shares issued in Lieu of
ividends and Distributions -- -- -- -- -- -- -- --
Shares redeemed -- -- (1,401,263) (1,644,197) (769,358) (713,370) (421,688) (446,618)
- ------------------------------------------------ ----------------------- ----------------------- -----------------------
Net Class S transactions -- -- (261,085) 13,535 (109,905) 87,685 (67,361) (37,160)
================================================ ======================= ======================= =======================
AMOUNTS DESIGNATED AS "--" ARE EITHER 0 OR HAVE BEEN ROUNDED TO 0.
CNI CHARTER FUNDS | PAGE 82
9. IN-KIND TRANSACTIONS
During the year ended September 30, 2008, the Opportunistic Value Fund issued
shares of beneficial interest in exchange for securities.The securities were
transferred at their current value on June 26, 2008 as follows:
Shares Value
Issued ($ Thousands)
-------------------------------------------
579,800 $5,979
10. TREASURY GUARANTEE PROGRAM
The CNI Charter Funds Board of Trustees approved the participation by the Prime
Money Market Fund, Government Money Market Fund and California Money Market Fund
(each, a "Fund," and collectively, the "Funds") in the U.S. Department of the
Treasury's Temporary Guarantee Program for Money Market Funds (the "Program")
for the initial term of the Program, which ended December 18, 2008, and the
first extended term of the Program, which ended April 30, 2009. After
considering the costs and benefits of continued participation in the Program,
the Board of Trustees determined that the Prime Money Market Fund and California
Tax Exempt Money Market Fund should continue to participate in the second
extended term of the Program, which ended September 18, 2009, but that the
Government Money Market Fund should not, since that Fund invests primarily in
government securities that are guaranteed by the U.S. Government.The Program
insured shares held by money market fund investors as of the close of business
on September 19, 2008 against loss in the event that a money market fund
liquidated its holdings and shareholders received less than $1.00 per share.The
guarantee would have been triggered, and funds set aside by the Treasury made
available, if a money market fund's net asset value per share fell below $0.995.
The second extended term of the Program covered shareholders of the Prime Money
Market Fund and California Tax Exempt Money Market Fund for amounts they held in
the respective Fund as of the close of business on September 19, 2008. New
accounts opened since September 19, 2008 and any increase in the number of
shares held by a shareholder after the close of business on September 19, 2008
were not guaranteed.
The Program was designed to address temporary dislocations in the credit
markets.The second extended term of the Program operated through September 18,
2009. Participation in the initial term and first extended term of the Program
required payments to the U.S. Department of the Treasury in the amount of 0.01%
and 0.015%, respectively, of the net asset value of each of Fund as of September
19, 2008. Participation in the second extended term of the Program required a
payment to the U.S. Department of the Treasury in the amount of 0.015% of the
net asset value of each of the Prime Money Market Fund and California Tax Exempt
Money Market Fund as of September 19, 2008.These expenses were borne by each
Fund and were not subject to any expense limitation then in effect. Additional
information about the Program is available on the U.S. Department of the
Treasury's website at www.ustreas.gov.
11. SUBSEQUENT EVENTS
The Trust has evaluated the need for disclosure and/or adjustments resulting
from subsequent events through November 25, 2009, the date the financial
statements were issued. Based on this evaluation, no adjustments were required
to the financial statements as of September 30, 2009.
CNI CHARTER FUNDS | PAGE 83
report of independent registered public accounting firm
- --------------------------------------------------------------------------------
TO THE SHAREHOLDERS AND BOARD OF TRUSTEES OF
CNI CHARTER FUNDS:
We have audited the accompanying statements of assets and liabilities of Large
Cap Value Equity Fund, Large Cap Growth Equity Fund, RCB Small Cap Value Fund,
Opportunistic Value Fund, Multi-Asset Fund, Corporate Bond Fund, Government Bond
Fund, California Tax Exempt Bond Fund, High Yield Bond Fund, Prime Money Market
Fund, Government Money Market Fund, and California Tax Exempt Money Market Fund
(collectively, the "Funds"), including the schedules of investments, as of
September 30, 2009, and the related statements of operations for the year then
ended, the statements of changes in net assets for each of the years or periods
in the two-year period then ended, and the financial highlights for each of the
years or periods in the five-year period then ended.These financial statements
and financial highlights are the responsibility of the Funds' management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits 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 and financial highlights are free of material misstatement.An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements and financial highlights. Our procedures
included confirmation of securities owned as of September 30, 2009, by
correspondence with the custodian and brokers or other appropriate auditing
procedures.An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation.We believe that our audits provide a reasonable
basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of each
of the aforementioned Funds of the CNI Charter Funds as of September 30, 2009,
the results of their operations for the year then ended, changes in their net
assets for each of the years or periods in the two-year period then ended, and
the financial highlights for each of the years or periods in the five-year
period then ended, in conformity with U.S. generally accepted accounting
standards.
(KPMG LLP)
PHILADELPHIA PENNSYLVANIA
NOVEMBER 25, 2009
CNI CHARTER FUNDS | PAGE 84
THIS PAGE INTENTIONALLY LEFT BLANK.
trustees and officers (UNAUDITED)
SEPTEMBER 30, 2009
- -------------------------------------------------------------------------------
Information pertaining to the Trustees and Officers of the Trust is set forth
below as of September 30, 2009.Trustees who are not deemed to be "interested
persons" of the Trust as defined in the Investment Company Act of 1940 are
referred to as "Independent Trustees."Trustees who are deemed to be "interested
persons" of the Trust are referred to as "Interested Trustees."The Trust's
Statement of Additional Information ("SAI") includes additional information
about the Trustees and Officers.The SAI may be obtained without charge by
calling 1-888-889-0799.
- -------------------------------------------------------------------------------
<Table>
<Caption>
TERM OF
OFFICE NUMBER OF
AND PORTFOLIOS IN OTHER
NAME POSITION(s) LENGTH OF FUND COMPLEX DIRECTORSHIPS
ADDRESS, HELD WITH TIME PRINCIPAL OCCUPATION(s) OVERSEEN BY HELD BY
AND AGE1 TRUST SERVED2 DURING PAST FIVE YEARS BOARD MEMBER3 TRUSTEE4
- ----------------------------------------------------------------------------------------------------------------------------
INTERESTED
TRUSTEE
- -----------------
Vernon C. Kozlen* Trustee Since President and Chief Executive Officer, 17 None
Age: 66 May 2007 CNI Charter Funds (2000-2007).
Executive Vice President and Director of
Asset Management Development, CNB
(1996-2007). Director, Reed, Conner &
Birdwell LLC (2000-present), and Convergent
Capital Management, LLC (2003-present).
Chairman of the Board, CNAM, Inc.
(2001-2005). Chairman of the Board,
City National Securities, Inc. (1999-2005).
Director, CNAM, Inc. (2001-2006), and
City National Securities, Inc. (1999-2006).
- ----------------------------------------------------------------------------------------------------------------------------
INDEPENDENT
TRUSTEES
- -----------------
Irwin G. Barnet, Trustee Since 1999 Attorney and partner, Reed Smith LLP, 17 None
Esq. a law firm (2003-present).Attorney and
Age: 71 principal, Crosby, Heafey, Roach &
May P.C., a law firm (2000-2002 ).
Attorney and principal, Sanders, Barnet,
Goldman, Simons & Mosk, a law firm
(1980-2000).
- ----------------------------------------------------------------------------------------------------------------------------
Victor Meschures Trustee Since 1999 Certified Public Accountant, Meschures, 17 None
Age: 71 Campeas,Thompson, Snyder, Pocras, Levin
& Dimaggio, LLP, an accounting firm
(1964-present).
- ----------------------------------------------------------------------------------------------------------------------------
William R. Sweet Trustee Since 1999 Retired. Executive Vice President, 17 None
Age: 72 Union Bank of California (1985-1996).
- ----------------------------------------------------------------------------------------------------------------------------
James Wolford Trustee Since 1999 Chief Financial Officer, Bixby Land 17 None
Age: 55 Company, a real estate company (2004-
present). Regional Financial Officer,
AIMCO, a real estate investment trust
(2004). Chief Financial Officer, DBM
Group, a direct mail marketing company
(2001-2004). SeniorVice President and Chief
Operating Officer, Forecast Commercial Real
Estate Service, Inc. (2000-2001). Senior
Vice President and Chief Financial Officer,
Bixby Ranch Company (1985-2000).
- ----------------------------------------------------------------------------------------------------------------------------
</Table>
CNI CHARTER FUNDS | PAGE 86
TERM OF
OFFICE
AND
NAME POSITION LENGTH OF
ADDRESS, HELD WITH TIME PRINCIPAL OCCUPATION(s)
AND AGE TRUST SERVED2 DURING PAST FIVE YEARS
- ------------------------------------------------------------------------------------------------------------------------------
OFFICERS
- ------------------------
Timothy D. Barto Vice President Since Attorney, Vice President and Assistant Secretary of SEI Investments
SEI Investments and Assistant 2000 (1999-Present).Vice President and Assistant Secretary of Administrator
One Freedom Valley Drive Secretary (1999-Present). Officer of various investment companies administered by
Oaks, PA 19456 Administrator (1999-2004).Assistant Secretary of the Distributor
Age: 41 (2003-2004).Vice President of the Distributor (1999-2004).
- ------------------------------------------------------------------------------------------------------------------------------
Eric Kleinschmidt Controller and Since Director of Fund Accounting, SEI Investments (2004-Present). Manager
SEI Investments Chief Operating 2005 of Fund Accounting, SEI Investments (1999-2004).
One Freedom Valley Drive Officer
Oaks, PA 19456
Age: 41
- ------------------------------------------------------------------------------------------------------------------------------
Valerie Y. Lewis Vice President Since Chief Compliance Officer, CNAM, Inc. (August, 2005-present). Fund
City National Bank and Chief 2005 Boards Specialist - Assistant Secretary, Capital Research and Management
555 S. Flower Street, Compliance and Company Capital International, Inc. (1999-2005).
18th Floor
Los Angeles, CA 90071 Officer
Age: 53
- ------------------------------------------------------------------------------------------------------------------------------
James Ndiaye Vice President Since Attorney, SEI Investments Company (2004-present).Vice President,
SEI Investments and Assistant 2005 Deutsche Asset Management (2003-2004).Associate, Morgan Lewis &
One Freedom Valley Drive Secretary Bockius LLP (2000-2003).Assistant Vice President, ING Variable
Oaks, PA 19456 Annuities Group (1999-2000).
Age: 41
- ------------------------------------------------------------------------------------------------------------------------------
Michael T. Pang Vice President Since Attorney, SEI Investments Company (2005-present). Counsel, Caledonian
SEI Investments and Assistant 2005 Bank & Trust's Mutual Funds Group (2004-2005). Counsel, Permal Asset
One Freedom Valley Drive Secretary Management (2001-2004).Associate, Schulte, Roth & Zabel's Investment
Oaks, PA 19456 Management Group (2000-2001).
Age: 37
- ----------
1 Each trustee may be contacted by writing to the Trustee c/o CNI Charter
Funds, One Freedom Valley Drive, Oaks, PA 19456.
2 Each trustee holds office during the lifetime of the Trust until he or she
dies, resigns, is declared bankrupt or incompetent by a court of
appropriate jurisdiction, or is removed, or, if sooner, until the next
meeting of shareholders is called for the purpose of electing trustees and
until the election and qualification of his or her successor in accordance
with the Trust's Declaration of Trust.The president, treasurer and
secretary hold office until their respective successors are chosen or
qualified, or until their removal or resignation, or in each case until he
or she sooner dies, resigns, is removed, or becomes disqualified in
accordance with the Trust's by-laws.
3 The "Fund Complex" consists of all series of the Trust. As of September 30,
2008, the Fund Complex consisted of 17 Funds.
4 Directorships of companies required to report to the Securities and
Exchange Commission under the Securities Exchange Act of 1934 (i.e.,
"public companies") or other investment companies registered under the 1940
Act.
* Mr. Kozlen is an "interested person" of the Trust, as defined in the 1940
Act, by virtue of his position with CNB, the parent company of CNAM, Inc.
until March 2007.
CNI CHARTER FUNDS | PAGE 87
trustees and officers (UNAUDITED) (CONTINUED)
SEPTEMBER 30, 2009
TERM OF
OFFICE
AND
NAME POSITION LENGTH OF
ADDRESS, HELD WITH TIME PRINCIPAL OCCUPATION(s)
AND AGE TRUST SERVED DURING PAST FIVE YEARS
- -----------------------------------------------------------------------------------------------------------------------------
OFFICERS (CONCLUDED)
- ------------------------
Rodney J. Olea Vice President Since Senior Vice President, CNAM, Inc. (2001-present). Senior Vice President
City National Bank 2000 and Director of Fixed Income, CNB (1994-present).
400 N. Roxbury Drive
Beverly Hills, CA 90210
Age: 44
- ------------------------------------------------------------------------------------------------------------------------------
Joseph Gallo Vice President Since Attorney for SEI Investments since 2007. Associate Counsel at ICMA--RC
SEI Investments and Secretary 2008 from 2004 to 2007. Assistant Secretary of The Vantage Trust Company in
One Freedom Valley Drive 2007. Assistant Secretary of The Vantagepoint Funds from 2006 to 2007.
Oaks, PA 19456 Investigator, U.S. Department of Labor from 2002 to 2004.
Age: 36
- ------------------------------------------------------------------------------------------------------------------------------
Timothy G. Solberg Vice President Since Managing Director and Chief Investment Officer, CCM Advisors
CCM Advisors, LLC and Assistant 2005 (2001-present); Director of Marketing and Client Services, Hewitt
190 S. LaSalle Street Secretary Investment Group, a Division of Hewitt Associates LLC (1989-2001).
Suite 2800
Chicago, IL 60603
Age: 56
- ------------------------------------------------------------------------------------------------------------------------------
Susan Rudzinski Vice President Since Compliance Director, Convergent Capital Management, LLC
CCM Advisors, LLC May (2006-present); Self-employed Investment Advisory Compliance and
190 S. LaSalle Street 2007 Operations Consultant (2005-2006); Manager,Affiliate Contracts,
Suite 2800 The Burridge Group LLC (2003-2004).
Chicago, IL 60603
Age: 46
- ------------------------------------------------------------------------------------------------------------------------------
Richard A.Weiss President Since President, CNAM, Inc. (2001-present). Executive Vice President and
City National Bank and Chief 2008 Chief Investment Officer, CNB (1999-present). Director, City National
400 N. Roxbury Drive Executive Securities (April 2003-present). Executive Vice President and Chief
Beverly Hills, CA 90210 Officer Investment Officer. Sanwa Bank California (1994-1999).
Age: 49
- ------------------------------------------------------------------------------------------------------------------------------
CNI CHARTER FUNDS | PAGE 88
notice to shareholders (UNAUDITED)
SEPTEMBER 30, 2009
- --------------------------------------------------------------------------------
For shareholders that do not have a September 30, 2009 taxable year end, this
notice is for informational purposes only. For shareholders with a September 30,
2009 taxable year end, please consult your tax advisor as to the pertinence of
this notice.
For California income tax purposes, for the fiscal year ended September 30,
2009, each of the California Tax Exempt Bond Fund and California Tax Exempt
Money Market Fund is designating 86.57% and 93.32%, respectively, of its
distributions paid from net investment income as exempt-interest dividends under
Section 17145 of the California Revenue and Taxation Code.
For Federal income tax purposes, for the fiscal year ended September 30, 2009
each Fund is designating the following items with regard to distributions paid
during the year:
(E)
DIVIDENDS
(A) (B) QUALIFYING
LONG TERM ORDINARY (C) (D) FOR CORPORATE
CAPITAL GAIN INCOME TAX EXEMPT TOTAL DIVIDENDS REC.
DISTRIBUTIONS DISTRIBUTIONS INTEREST DISTRIBUTIONS DEDUCTION (1)
- -----------------------------------------------------------------------------------------------------------
Large Cap Value Equity Fund 0.00% 100.00% 0.00% 100.00% 100.00%
Large Cap Growth Equity Fund 0.00% 100.00% 0.00% 100.00% 100.00%
RCB Small Cap Value Fund 0.00% 100.00% 0.00% 100.00% 41.94%
Opportunistic Value 0.00% 100.00% 0.00% 100.00% 100.00%
Multi-Asset Fund 0.00% 100.00% 0.00% 100.00% 5.27%
Corporate Bond Fund 0.00% 100.00% 0.00% 100.00% 0.00%
Government Bond Fund 0.00% 100.00% 0.00% 100.00% 0.00%
California Tax Exempt Bond
Fund 0.00% 0.00% 100.00% 100.00% 0.00%
High Yield Bond Fund 0.00% 100.00% 0.00% 100.00% 0.00%
Prime Money Market Fund 0.00% 100.00% 0.00% 100.00% 0.00%
Government Money Market Fund 0.00% 100.00% 0.00% 100.00% 0.00%
California Tax Exempt Money
Market Fund 0.00% 0.01% 99.99% 100.00% 0.00%
- -----------------------------------------------------------------------------------------------------------
(F)
QUALIFYING
DIVIDEND (G) (H) (I)
INCOME U.S. INTEREST SHORT -TERM
(15% RATE GOVERNMENT RELATED CAPITAL GAIN
FOR QDI)(2) INTEREST(3) DIVIDENDS(4) DIVIDENDS(5)
- --------------------------------------------------------------------------------------
Large Cap Value Equity Fund 100.00% 0.00% 0.00% 0.00%
Large Cap Growth Equity Fund 100.00% 0.00% 0.00% 0.00%
RCB Small Cap Value Fund 41.47% 0.00% 5.27% 100.00%
Opportunistic Value 100.00% 0.00% 0.00% 0.00%
Multi-Asset Fund 31.78% 7.86% 18.57% 0.00%
Corporate Bond Fund 0.00% 0.72% 98.41% 0.00%
Government Bond Fund 0.00% 31.13% 99.15% 0.00%
California Tax Exempt Bond 0.00% 0.00% 0.00% 0.00%
Fund
High Yield Bond Fund 0.00% 0.00% 98.57% 0.00%
Prime Money Market Fund 0.00% 17.38% 93.18% 0.00%
Government Money Market Fund 0.00% 63.95% 98.10% 0.00%
California Tax Exempt Money
Market Fund 0.00% 0.00% 0.00% 0.00%
- --------------------------------------------------------------------------------------
- ----------
(1) "DIVIDENDS RECEIVED DEDUCTION" REPRESENT DIVIDENDS WHICH QUALIFY FOR THE
CORPORATE DIVIDENDS RECEIVED DEDUCTION.
(2) "QUALIFYING DIVIDEND INCOME" REPRESENT QUALIFYING DIVIDENDS AS CREATED BY
THE JOBS AND GROWTH TAX RELIEF RECONCILIATION ACT OF 2003. THE FUND
INTENDS TO DESIGNATE THE MAXIMUM AMOUNT PERMITTED BY LAW.
(3) "U.S. GOVERNMENT INTEREST" REPRESENT THE AMOUNT OF INTEREST THAT WAS
DERIVED FROM DIRECT U.S. GOVERNMENT OBLIGATIONS AND DISTRIBUTED DURING THE
FISCAL YEAR.THIS AMOUNT IS REFLECTED AS A PERCENTAGE OF ORDINARY INCOME.
GENERALLY, INTEREST FROM DIRECT U.S. GOVERNMENT OBLIGATIONS IS EXEMPT FROM
STATE INCOME TAX. HOWEVER, FOR SHAREHOLDERS WHO ARE RESIDENTS OF
CALIFORNIA, CONNECTICUT OR NEW YORK, THE STATUTORY THRESHOLD REQUIREMENTS
WERE NOT SATISFIED TO PERMIT EXEMPTION OF THESE AMOUNTS FROM STATE INCOME.
(4) "INTEREST RELATED DIVIDENDS" REPRESENT QUALIFYING INTEREST THAT IS EXEMPT
FROM U.S. WITHHOLDING TAX WHEN PAID TO FOREIGN INVESTORS AS CREATED BY THE
AMERICAN JOBS CREATION ACT OF 2004.THIS PROVISION OF THE INTERNAL REVENUE
CODE WILL BE EXPIRING FOR YEARS BEGINNING AFTER JANUARY 1, 2010.
(5) "SHORT-TERM CAPITAL GAIN DIVIDENDS" REPRESENT QUALIFYING SHORT-TERM
CAPITAL GAIN THAT IS EXEMPT FROM U.S. WITHHOLDING TAX WHEN PAID TO FOREIGN
INVESTORS AS CREATED BY THE AMERICAN JOBS CREATION ACT OF 2004.THIS
PROVISION OF THE INTERNAL REVENUE CODE WILL BE EXPIRING FOR YEARS
BEGINNING AFTER JANUARY 1, 2010.
ITEMS (A), (B), (C) AND (D) ARE BASED ON THE PERCENTAGE OF EACH FUND'S TOTAL
DISTRIBUTION.
ITEMS (E) AND (F) ARE BASED ON THE PERCENTAGE OF "ORDINARY INCOME
DISTRIBUTIONS."
ITEM (G) IS BASED ON THE PERCENTAGE OF GROSS INCOME OF EACH FUND.
ITEM (H) IS BASED ON THE PERCENTAGE OF NET INVESTMENT INCOME DISTRIBUTIONS.
ITEM (I) IS BASED ON THE PERCENTAGE OF SHORT-TERM CAPITAL GAIN DISTRIBUTIONS.
CNI CHARTER FUNDS | PAGE 89
disclosure of fund expenses (UNAUDITED)
- --------------------------------------------------------------------------------
All mutual funds have operating expenses.As a shareholder of a Fund, your
investment is affected by these ongoing costs, which include (among others)
costs for portfolio management, administrative services, class-specific
distribution fees and shareholder reports like this one. It is important for you
to understand the impact of these costs on your investment returns.
Operating expenses such as these are deducted from the Fund's gross income and
directly reduce your final investment return. These expenses are expressed as a
percentage of the Fund's average net assets; this percentage is known as the
Fund's expense ratio.
The following examples use the expense ratio and are intended to help you
understand the ongoing costs (in dollars) of investing in your Fund and to
compare these costs with those of other mutual funds.The examples are based on
an investment of $1,000 made at the beginning of the period shown and held for
the entire period.
The table below illustrates your Fund's costs in two ways:
ACTUAL FUND RETURN.This section helps you to estimate the actual expenses that
your Fund incurred over the period.The "Expenses Paid During Period" column
shows the actual dollar expense cost incurred by a $1,000 investment in the
Fund, and the "Ending Account Value" number is derived from deducting that
expense cost from the Fund's gross investment return.
You can use this information, together with the actual amount you invested in
the Fund, to estimate the expenses you paid over that period. Simply divide your
actual account value by $1,000 to arrive at a ratio (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply that ratio by the number
shown for your Fund under "Expenses Paid During Period."
HYPOTHETICAL 5% RETURN.This section helps you compare your Fund's costs with
those of other mutual funds. It assumes that the Fund had an annual 5% return
before expenses during the year, but that the expense ratio (Column 3) for the
period is unchanged.This example is useful in making comparisons because the
Securities and Exchange Commission requires all mutual funds to make this 5%
calculation.You can assess your Fund's comparative cost by comparing the
hypothetical result for your Fund in the "Expenses Paid During Period" column
with those that appear in the same charts in the shareholder reports for other
funds.
NOTE: Because the return is set at 5% for comparison purposes -- NOT your Fund's
actual return -- the account values shown do not apply to your specific
investment.
BEGINNING ENDING EXPENSES
ACCOUNT ACCOUNT ANNUALIZED PAID
VALUE VALUE EXPENSE DURING
4/1/09 9/30/09 RATIOS PERIOD*
- ----------------------------------------------------------------------
LARGE CAP VALUE FUND
- ----------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $1,322.00 0.96% $ 5.59
Class N 1,000.00 1,321.00 1.21 7.04
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $1,020.26 0.96% $ 4.86
Class N 1,000.00 1,019.00 1.21 6.12
- ----------------------------------------------------------------------
LARGE CAP GROWTH FUND
- ----------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $1,284.20 0.99% $ 5.67
Class N 1,000.00 1,282.00 1.24 7.09
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $1,020.10 0.99% $ 5.01
Class N 1,000.00 1,018.85 1.24 6.28
- -------------------------------------------------------------------------
RCB SMALL CAP VALUE FUND
- -------------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $1,692.00 1.19% $ 8.03
Class A 1,000.00 1,690.30 1.44 9.71
Class R 1,000.00 1,691.50 1.21 8.16
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $1,019.10 1.19% $ 6.02
Class A 1,000.00 1,017.85 1.44 7.28
Class R 1,000.00 1,019.00 1.21 6.12
- -------------------------------------------------------------------------
OPPORTUNISTIC VALUE FUND
- -------------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $1,360.80 0.93% $ 5.50
Class A 1,000.00 1,359.80 1.18 $ 6.98
Class E 1,000.00 1,362.00 0.69 4.09
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $1,020.41 0.93% $ 4.71
Class A 1,000.00 1,019.15 1.18 5.97
Class E 1,000.00 1,021.61 0.69 3.50
- ----------
* Expenses are equal to the Fund's annualized expense ratio multiplied by
the average account value over the period, multiplied by 183/365 (to
reflect the one-half year period).
CNI CHARTER FUNDS | PAGE 90
BEGINNING ENDING EXPENSES
ACCOUNT ACCOUNT ANNUALIZED PAID
VALUE VALUE EXPENSE DURING
4/1/09 9/30/09 RATIOS PERIOD*
- --------------------------------------------------------------------------------
MULTI-ASSET FUND
- --------------------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $1,155.10 0.84% $ 4.54
Class A 1,000.00 1,152.60 1.09 $ 5.88
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $1,020.86 0.84% $ 4.26
Class A 1,000.00 1,019.60 1.09 5.52
- --------------------------------------------------------------------------------
CORPORATE BOND FUND
- --------------------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $1,082.00 0.74% $ 3.86
Class A 1,000.00 1,080.60 0.99 $ 5.16
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $1,021.36 0.74% $ 3.75
Class A 1,000.00 1,020.10 0.99 5.01
- --------------------------------------------------------------------------------
GOVERNMENT BOND FUND
- --------------------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $1,019.40 0.70% $ 3.54
Class A 1,000.00 1,017.10 0.95 4.80
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $1,021.56 0.70% $ 3.55
Class A 1,000.00 1,020.31 0.95 4.81
- --------------------------------------------------------------------------------
CALIFORNIA TAX-EXEMPT BOND FUND
- --------------------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $1,038.70 0.50% $ 2.56
Class A 1,000.00 1,037.20 0.75 3.83
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $1,022.56 0.50% $ 2.54
Class A 1,000.00 1,021.31 0.75 3.80
- --------------------------------------------------------------------------------
HIGH YIELD BOND FUND
- --------------------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $1,348.80 1.00% $ 5.89
Class A 1,000.00 1,346.80 1.30 7.65
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $1,020.05 1.00% $ 5.06
Class A 1,000.00 1,018.55 1.30 6.58
BEGINNING ENDING EXPENSES
ACCOUNT ACCOUNT ANNUALIZED PAID
VALUE VALUE EXPENSE DURING
4/1/09 9/30/09 RATIOS PERIOD*
- ----------------------------------------------------------------------------------
PRIME MONEY MARKET FUND
- ----------------------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $ 1,000.90 0.29% $ 1.45
Class A 1,000.00 1,000.50 0.37 1.86
Class S 1,000.00 1,000.30 0.43 2.16
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $ 1,023.61 0.29% $ 1.47
Class A 1,000.00 1,023.21 0.37 1.88
Class S 1,000.00 1,022.91 0.43 2.18
- ----------------------------------------------------------------------------------
GOVERNMENT MONEY MARKET FUND
- ----------------------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $ 1,000.30 0.23% $ 1.15
Class A 1,000.00 1,000.20 0.25 1.25
Class S 1,000.00 1,000.10 0.27 1.35
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $ 1,023.92 0.23% $ 1.17
Class A 1,000.00 1,023.82 0.25 1.27
Class S 1,000.00 1,023.71 0.27 1.37
- ----------------------------------------------------------------------------------
CALIFORNIA TAX EXEMPT MONEY MARKET FUND
- ----------------------------------------------------------------------------------
ACTUAL FUND RETURN
Institutional Class $1,000.00 $ 1,000.70 0.20% $ 1.00
Class A 1,000.00 1,000.30 0.28 1.40
Class S 1,000.00 1,000.20 0.30 1.50
HYPOTHETICAL 5% RETURN
Institutional Class $1,000.00 $ 1,024.07 0.20% $ 1.01
Class A 1,000.00 1,023.66 0.28 1.42
Class S 1,000.00 1,023.56 0.30 1.52
- ----------
* Expenses are equal to the Fund's annualized expense ratio multiplied by
the average account value over the period, multiplied by 183/365 (to
reflect the one-half year period).
CNI CHARTER FUNDS | PAGE 91
board approval of sub-advisory agreement (UNAUDITED)
- --------------------------------------------------------------------------------
The Board of Trustees of CNI Charter Funds (the "Trust") is comprised of five
Trustees, four of whom are independent of the Trust's investment advisers and
sub-advisers (the "Independent Trustees"). During the six months ended September
30, 2009, the Board and the Independent Trustees approved renewal of the Trust's
advisory agreement (the "Management Agreement") with City National Asset
Management, Inc. ("CNAM"); renewal of CNAM's sub-advisory agreement (the "RCB
Agreement") with Reed, Conner & Birdwell, LLC ("RCB") with respect to the RCB
Small Cap Value Fund (the "RCB Fund"); and renewal of CNAM's sub-advisory
agreement (the "SKBA Agreement") with SKBA Capital Management, LLC ("SKBA") with
respect to the Opportunistic Value Fund.The RCB Agreement and the SKBA Agreement
are collectively referred to below as the "Sub-Advisory Agreements" and the
Management Agreement and Sub-Advisory Agreements are referred to below as the
"Agreements."
GENERAL INFORMATION
The following information summarizes the Board's considerations associated with
its review of the Agreements. In connection with their deliberations, the Board
considered such information and factors as they believed, in light of the legal
advice furnished to them and their own business judgment, to be relevant.The
Agreements were considered separately for each investment portfolio of the Trust
(each a "Fund"), although the Board took into account the common interests of
the Funds in its review.As described below, the Board considered the nature,
quality and extent of the various investment advisory and administrative
services performed by CNAM, RCB and SKBA. In considering these matters, the
Independent Trustees discussed the approval of the Agreements with management
and in private sessions with counsel at which no representatives of CNAM, RCB or
SKBA were present.
The Board reviewed extensive materials regarding investment results of CNAM, RCB
and SKBA and advisory fee and expense comparisons, financial information with
respect to each entity, descriptions of various functions such as compliance
monitoring and portfolio trading practices, and information about the personnel
providing investment management and administrative services to the Funds.They
also took into account information they received at past Board meetings with
respect to these matters.
In deciding to approve the Agreements, the Board and the Independent Trustees
did not identify a single factor as controlling and this summary does not
describe all of the matters considered. However, the Board and the Independent
Trustees concluded that each of the various factors referred to below favored
such approval.
CNAM
NATURE, EXTENT AND QUALITY OF SERVICES
In reviewing the services provided by CNAM, the Board considered a variety of
matters, including the background, education and experience of its key portfolio
management and operational personnel; its overall financial strength and
stability; its resources and efforts to retain, attract and motivate capable
personnel to serve the Funds; and the overall general quality and depth of its
organization.The Board also took into account the experience, capability and
integrity of CNAM's senior management; its investment philosophy and processes,
including sub-adviser oversight processes; its brokerage, trading and soft
dollar practices; its disaster recovery and contingency planning; and its
commitment and systems in place with regard to compliance with applicable laws
and regulations.
INVESTMENT PERFORMANCE
The Board assessed the performance of each Fund compared with its respective
benchmark and the average of all funds in its respective peer group category
(each, a "universe") selected by Lipper, Inc. and iMoneyNet, Inc. (for the money
market funds only) for the nine-month and one-, three- and five-year and since
inception periods ended June 30, 2009 (nine-month, one-year and since inception
periods with respect to the Multi-Asset Fund, which commenced operations on
October 1, 2007).The Board also reviewed the performance of each Fund compared
with the average performance of all funds in its respective "bank channel"
universe, which includes only those funds in the Fund's Lipper universe that are
distributed through institutional and retail bank channels.The Board made the
following observations in reviewing the Funds' performance:
CNI CHARTER FUNDS | PAGE 92
o The annualized total returns of the PRIME MONEY MARKET FUND and CALIFORNIA
TAX EXEMPT MONEY MARKET FUND were below the average returns of the
relevant Lipper institutional money market fund universes, iMoneyNet
institutional fund universes, and bank channel universes for all periods.
o The annualized total returns of the GOVERNMENT MONEY MARKET Fund were
below the average returns of the relevant Lipper institutional money
market fund universe and bank channel universe for all periods, and near
or above the average returns of the relevant iMoneyNet institutional fund
universe for all periods except for the five-year and since inception
periods.
o The annualized total returns of the CORPORATE BOND FUND were above the
average returns of the Lipper short/intermediate investment-grade
universe, the bank channel universe and the Barclays Capital Intermediate
US Corporate Index returns for all periods, except for the Index returns
for the nine-month and since inception periods.
o The annualized total returns of the CALIFORNIA TAX EXEMPT BOND FUND were
above the average returns of the Lipper California short/intermediate
municipal debt universe for all periods, and below the average returns of
the bank channel universe and the Barclays Capital CA Intermediate-Short
Municipal Index returns for all periods (except that they were above the
average returns of the bank channel universe for the since inception
period).
o The annualized total returns of the GOVERNMENT BOND FUND were below the
average returns of the Lipper short/intermediate US government universe,
the bank channel universe and the Barclays Capital US Government Bond
Index for all periods (except that they were above the average returns of
the bank channel universe for the three-year and since inception periods).
o The annualized total returns of the HIGH YIELD BOND FUND were above the
average returns of the Lipper high current yield fund universe for the
one-year, three-year and since inception periods, but were below the
average returns of the Lipper high current yield fund universe for the
nine-month and five-year periods and below the average returns of the bank
channel universe and Citigroup High-Yield Market Index returns for all
periods.
o The annualized total returns of the MULTI-ASSET FUND were above the
average returns of the Lipper flexible portfolio funds universe and bank
channel universe and the returns of a blended index comprised 60% of the
S&P 500 Index and 40% of the Barclays Capital Intermediate
Government/Credit Index (the "Blended Index") for all periods, but were
below the returns of the CPI plus 500 basis points benchmark and the
Barclays Capital US Treasury Inflation Protected Securities Index for all
periods.
o The annualized total returns of the LARGE CAP GROWTH EQUITY FUND were
above the average returns of the Lipper large cap growth fund universe,
the bank channel universe and the S&P 500/Citigroup Growth Index returns
for all periods.
o The annualized total returns of the LARGE CAP VALUE EQUITY FUND were above
the average returns of the Lipper large cap value funds universe and S&P
500/Citigroup Value Index returns for all periods and were above the
average returns of the bank channel universe for the one-, three- and
five-year periods, but were below the average returns of the Lipper large
cap value funds universe for the nine-month period and slightly below the
average returns of the bank channel universe for the nine-month and since
inception periods.
o The annualized total returns of the RCB FUND were above the average
returns of the Lipper small cap core funds universe, bank channel universe
and Russell 2000 Index for the nine-month, one-year and since inception
periods, but were below all those measures for the three-year and
five-year periods.
o The annualized total returns of the OPPORTUNISTIC VALUE FUND were above
the average returns of the Lipper large-cap value funds universe and
Russell 1000 Value Index returns for all periods, and were also above the
average returns of the Lipper multi-cap value funds universe for
CNI CHARTER FUNDS | PAGE 93
board approval of sub-advisory agreement (UNAUDITED) (CONTINUED)
- --------------------------------------------------------------------------------
the since inception period, but were below the average returns of the
Lipper multi-cap value funds universe for the nine-month period and below
the average returns of the bank channel universe for all periods.
The Board concluded that CNAM continued to provide satisfactory management and
oversight services to the Funds. They noted that the investment results of the
Funds were generally competitive during the past year and, in most cases, during
previous periods; that the results for the Money Market Funds compared to their
peer groups were acceptable given the special services and investment focuses of
those Funds; and that consideration of returns of market indexes needed to take
into account that indexes do not reflect the expenses of operating mutual funds.
ADVISORY FEES AND FUND EXPENSES
The Board reviewed information regarding the advisory fees charged by CNAM and
the total expenses of each of the Funds compared to those of the funds included
in the relevant Lipper and bank channel universes, and concluded that the
advisory fees and expenses of the Funds continued to be reasonable.
The Board observed that the actual investment advisory fees (net of fee waivers)
paid by the Funds generally were at or above the relevant Lipper and bank
channel averages, but (except for the Government Money Market Fund) were within
the middle 60% range for the relevant Lipper universes. In considering the
information about advisory fees, the Board noted the relatively small size of
the Funds compared to the average sizes of the funds in the relevant Lipper and
bank channel universes.As the Funds represent CNAM's sole investment advisory
clients, the Board was not able to compare the fees charged to the Funds by CNAM
with fees charged to other institutional clients of CNAM.
The Board considered that the total expense ratios of the Funds were generally
below the relevant Lipper universe averages (except for the Prime Money Market
Fund, the Government Money Market Fund and the Multi-Asset Fund) and above the
bank channel averages (except for the California Tax Exempt Money Market Fund,
the California Tax Exempt Bond Fund and the Opportunistic Value Fund), but were
all within the middle 60% range for the relevant Lipper universes.
The Board considered information prepared by CNAM relating to its costs and
profits with respect to the Funds, noting that because the Trust is CNAM's sole
client, all of CNAM's costs are allocable to the Trust.The Board also considered
the benefits received by CNAM and its affiliates as a result of CNAM's
relationship with the Funds, including investment advisory fees paid to CNAM,
fees paid to City National Bank and City National Securities, Inc. for providing
certain shareholder servicing and sub-distribution services to the Trust, and
the intangible benefits of any favorable publicity arising in connection with
the Funds' performance.They also noted that although there were no advisory fee
breakpoints, based on CNAM's operations significant economies of scale were not
likely to be realized until the asset levels of most of the Funds were
significantly higher than their current levels.
CONCLUSIONS
Based on their review, including their consideration of each of the factors
referred to above, the Board and the Independent Trustees concluded that the
compensation payable to CNAM pursuant to the Management Agreement is fair and
reasonable in light of the nature and quality of the services being provided by
CNAM to the respective Funds and their shareholders, and that renewal of the
Management Agreement was in the best interest of the Funds and their
shareholders.
RCB
NATURE, EXTENT AND QUALITY OF SERVICES
In reviewing the services provided by RCB to the RCB Fund, the Board considered
a variety of matters, including the background, education and experience of its
key portfolio management and operational personnel; its overall financial
strength and stability; its resources and related efforts to retain, attract and
motivate capable personnel to serve the RCB Fund; and the overall general
quality and depth of its organization.The Board also reviewed RCB's investment
philosophy and processes as well as its brokerage and trading practices.
INVESTMENT PERFORMANCE
The Board's observations regarding the RCB Fund's performance are described
above. In addition, the Board noted that the RCB Fund's performance had improved
significantly
CNI CHARTER FUNDS | PAGE 94
within the last six months and that it was in the top 20% of its Lipper universe
for the period since its inception, although its results for interim period were
not as favorable.
ADVISORY FEES AND FUND EXPENSES
The Board reviewed information regarding the advisory fees charged by RCB and
observed that the fees charged by RCB were low compared to the fees it charged
to other institutional clients.They noted that CNAM pays RCB's sub-advisory fees
out of CNAM's advisory fee.Although RCB's fee schedule has no breakpoints, they
also noted that the asset levels of the RCB Fund were not so substantial that
they would lead to significant economies of scale.
The Board considered information prepared by RCB relating to its costs and
profits with respect to the RCB Fund, as well as the methodologies used to
determine and allocate such costs to its management of the Fund.The Board also
considered the benefits received by RCB and its affiliates as a result of RCB's
relationship with the Fund, including the sub-advisory fees paid to RCB, fees
paid to CNAM as the Fund's adviser, fees paid to City National Bank and City
National Securities, Inc. for providing certain shareholder servicing and
sub-distribution services to the Trust, and the intangible benefits of any
favorable publicity arising in connection with the RCB Fund's performance.
CONCLUSIONS
Based on their review, including their consideration of each of the factors
referred to above, the Board and the Independent Trustees concluded that the
compensation payable to RCB pursuant to the RCB Agreement is fair and reasonable
in light of the nature and quality of the services being provided by RCB to the
RCB Fund and its shareholders, and that renewal of the RCB Agreement was in the
best interest of the Fund and its shareholders.
SKBA
NATURE, EXTENT AND QUALITY OF SERVICES
In reviewing the services provided by SKBA to the Opportunistic Value Fund, the
Board considered a variety of matters, including the background, education and
experience of its key portfolio management and operational personnel; its
overall financial strength and stability; its resources and related efforts to
retain, attract and motivate capable personnel to serve the Opportunistic Value
Fund; and the overall general quality and depth of its organization.The Board
also reviewed SKBA's investment philosophy and processes as well as its
brokerage and trading practices.
INVESTMENT PERFORMANCE
The Board's observations regarding the Opportunistic Value Fund's performance
are described above.
ADVISORY FEES AND FUND EXPENSES
The Board reviewed information regarding the advisory fees charged by SKBA and
observed that SKBA's advisory fee with respect to the Opportunistic Value Fund
was higher than SKBA's fees with respect to the other series of the Trust for
which it serves as sub-adviser.The Trustees considered, however, that SKBA had
implemented expense caps for all classes of the Fund, and that any reimbursement
of Fund expenses in excess of the caps would be SKBA's responsibility. They also
noted that CNAM pays SKBA's sub-advisory fees out of CNAM's advisory fee.
The Board considered information prepared by SKBA relating to its costs and
profits with respect to the Opportunistic Value Fund, as well as the
methodologies used to determine and allocate such costs to its management of the
Fund.The Board also considered the benefits received by SKBA as a result of
SKBA's relationship with the Opportunistic Value Fund, including fees paid to
SKBA as the Fund's sub-adviser and the intangible benefits of any favorable
publicity arising in connection with the Fund's performance.
CONCLUSIONS
Based on their review, including their consideration of each of the factors
referred to above, the Board and the Independent Trustees concluded that the
compensation payable to SKBA pursuant to the SKBA Agreement is fair and
reasonable in light of the nature and quality of the services being provided by
SKBA to the Opportunistic Value Fund and its shareholders, and that renewal of
the SKBA Agreement was in the best interest of the Fund and its shareholders.
CNI CHARTER FUNDS | PAGE 95
ITEM 2. CODE OF ETHICS.
The registrant has adopted a code of ethics that applies to the registrant's
principal executive officer, principal financial officer and principal
accounting officer.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a)(1) The registrant's board of trustees has determined that the registrant has
at least one audit committee financial expert serving on the audit committee.
(a)(2) The audit committee financial experts are William R. Sweet and James R.
Wolford. Messrs. Sweet and Wolford are independent as defined in Form N-CSR Item
3(a)(2).
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Fees billed by KPMG LLP Related to the Trust
KPMG LLP billed the Trust aggregate fees for services rendered to the Trust for
the last two fiscal years as follows:
2009 2008
--------------------------------------------------- ---------------------------------------------------
All fees and All other fees All fees and All other fees
services to and services to services to and services to
All fees and service service All fees and service service
services to the affiliates that affiliates that services to the affiliates that affiliates that
Trust that were were did not require Trust that were were did not require
pre-approved pre-approved pre-approval pre-approved pre-approved pre-approval
--------------- --------------- --------------- --------------- --------------- ---------------
(a) Audit $316,000 N/A N/A $315,000 N/A N/A
Fees(1)
(b) Audit-Relat N/A N/A N/A N/A N/A N/A
Fees
(c) Tax Fees $ 60,550 N/A N/A $ 66,400 N/A N/A
(d) All N/A N/A N/A N/A N/A N/A
Other
Fees
- ----------
Notes:
(1) Audit fees include amounts related to the audit of the registrant's
annual financial statements and services normally provided by the
accountant in connection with statutory and regulatory filings.
(e)(1) Not Applicable
(e)(2) Percentage of fees billed applicable to non-audit services pursuant to
waiver of pre-approval requirement were as follows:
2009 2008
---- ----
Audit-Related Fees N/A N/A
Tax Fees N/A N/A
All Other Fees N/A N/A
(f) Not Applicable
(g) The aggregate non-audit fees and services billed by KPMG LLP for the last
two fiscal years were $60,550 and $66,400 for 2009 and 2008, respectively.
(h) Not Applicable
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to open-end management investment companies.
ITEM 6. SCHEDULE OF INVESTMENTS
Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to open-end management investment companies.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES
Not applicable. Effective for closed-end management investment companies for
fiscal years ending on or after December 31, 2005
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT COMPANY AND
AFFILIATED PURCHASERS.
Not applicable to open-end management investment companies.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
CNI Charter Funds (the "Fund") has adopted the following procedures by which
shareholders may recommend nominees to the Fund's Board of Trustees. The Fund
has a Nominating Committee comprised solely of persons who are not considered
"interested persons" of the Fund within the meaning of the Investment Company
Act of 1940. The Committee periodically reviews such issues as the Board's
composition, responsibilities, committees, compensation and other relevant
issues, and recommends any
appropriate changes to the full Board of Trustees. While the Committee normally
is able to identify from its own resources an ample number of qualified
candidates, it will consider shareholder suggestions of persons to be considered
as nominees to fill future vacancies on the Board, so long as the shareholder or
shareholder group submitting a proposed nominee: (a) beneficially owns more than
5% of the Fund's voting shares and has held such shares continuously for two
years, and (b) is not an adverse holder. No eligible shareholder or shareholder
group may submit more than one independent Board member nominee each year. Such
suggestions must be sent in writing to the Fund 's Secretary, and must be
accompanied by the shareholder's contact information, the nominee's contact
information and number of Fund shares owned by the nominee, all information
regarding the nominee that would be required to be disclosed in solicitations of
proxies for elections of directors required under the Securities Exchange Act of
1934, and a notarized letter from the nominee stating his or her intention to
serve as a nominee and be named in the Fund's proxy statement, if so designated
by the Committee and the Board of Trustees.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The certifying officers, whose certifications are included herewith, have
evaluated the registrant's disclosure controls and procedures within 90 days of
the filing date of this report. In their opinion, based on their evaluation, the
registrant's disclosure controls and procedures are adequately designed, and are
operating effectively to ensure, that information required to be disclosed by
the registrant in the reports it files or submits under the Securities Exchange
Act of 1934 is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commission's rules and forms.
(b) There were no significant changes in the registrant's internal control over
financial reporting that occurred during the registrant's last fiscal half-year
that has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
ITEMS 12. EXHIBITS.
(a)(1) Code of Ethics attached hereto.
(a)(2) A separate certification for the principal executive officer and the
principal financial officer of the registrant as required by Rule 30a-2(a) under
the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(a)), are filed
herewith.
(b) Officer certifications as required by Rule 30a-2(b) under the Investment
Company Act of 1940, as amended (17 CFR 270.30a-2(b)) also accompany this filing
as an Exhibit.
SIGNATURES
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.
(Registrant) CNI Charter Funds
By (Signature and Title)* /s/ Richard A. Weiss
---------------------------------
Richard A. Weiss, President & CEO
Date November 25, 2009
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 (Signature and Title) /s/ Richard A. Weiss
---------------------------------
Richard A. Weiss, President & CEO
Date November 25, 2009
By (Signature and Title) /s/ Eric Kleinschmidt
---------------------------------
Eric Kleinschmidt, Controller and
COO
Date November 25, 2009