<PAGE>
Registration Nos. 33-80195
811-9142
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 14 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ ]
Amendment No. 13 [X]
(Check appropriate box or boxes.)
THE NAVELLIER PERFORMANCE FUNDS
---------------------------------
(Exact name of registrant as specified in charter)
One East Liberty, Third Floor
Reno, Nevada 89501
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(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (800) 887-8671
Arjen Kuyper
The Navellier Performance Funds
One East Liberty, Third Floor
Reno, Nevada 89501
(Name and Address of Agent For Service)
Copy to:
Samuel Kornhauser, Esq.
Law Offices of Samuel Kornhauser
155 Jackson Street, Suite 1807
San Francisco, CA 94111
(415) 981-6281
It is proposed that this filing will become effective:
___ immediately upon filing pursuant to paragraph (b)
_X_ on December 28, 1999 pursuant to paragraph (b)
___ 60 days after filing pursuant to paragraph (a)(1)
___ on (date) pursuant to paragraph (a)(1)
___ 75 days after filing pursuant to paragraph (a)(2)
___ on (date) pursuant to paragraph (a)(2) of rule 485
If appropriate, check the following box:
___ this post-effective amendment designates a new effective date for
a previously filed post-effective amendment.
Title of Securities Being Registered:
Investment Company Shares
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CROSS REFERENCE SHEET
(required by Rule 495)
Item No. Location
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PART A
Item 1. Front and Back Cover Pages............. Front and Back Cover Pages
Item 2. Risk/Return Summary: Investments,
Risks and Performance.................. The Principal Risks; How the Portfolio
Has Performed
Item 3. Risk/Return Summary: Fee Table......... Fees and Expenses of the Portfolio
Item 4. Investment Objectives, Principal
Investment Strategies, and Related
Risks.................................. Our Principal Strategy
Item 5. Management's Discussion of Fund
Performance............................ Not Applicable
Item 6. Management, Organization, and
Capital Structure...................... Who is Responsible for the Portfolios
Item 7. Shareholder Information................ Account Policies; How to Buy, Sell and
Exchange Shares; Understanding Taxes;
Understanding Earnings
Item 8. Distribution Arrangements.............. How to Buy, Sell and Exchange Shares
Item 9. Financial Highlights Information........ Financial Highlights
PART B
Item 10. Cover Page and Table of Contents....... Cover Page and Table of Contents
Item 11. Fund History........................... General Information and History
Item 12. Description of the Fund and Its
Investments and Risks.................. Investment Objectives and Policies
Item 13. Management of the Fund................. Trustees and Officers of the Fund
Item 14. Control Persons and Principal
Holders of Securities.................. Control Persons and Principal Holders
of Securities
Item 15. Investment Advisory and Other
Services............................... The Investment Advisor, Distributor,
Custodian and Transfer Agent
Item 16. Brokerage Allocations and Other
Practices.............................. Brokerage Allocation and Other Practices
Item 17. Capital Stock and Other
Securities............................. Capital Stock and Other Securities
Item 18. Purchase, Redemption and
Pricing of Shares...................... Purchase, Redemption, and Pricing of
Shares
Item 19. Taxation of the Fund................... Taxes
Item 20. Underwriters........................... Underwriters
Item 21. Calculation of Performance Data........ Calculation of Performance
Data
Item 22. Financial Statements................... Financial Statements
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PART C
Information required to be included in Part C is set forth under the appropriate
Item, so numbered, in Part C to this Registration Statement.
EXPLANATORY NOTE
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The purpose of this filing is to add a class of shares - Class I shares - to the
Navellier Mid Cap Growth Portfolio of the Fund. A Prospectus and Statement of
Additional Information for the Class I shares of Navellier Mid Cap Growth
Portfolio are contained as part of this Registration Statement. The Prospectus
and Statement of Additional Information for all other Portfolios of the Fund,
including for the non-Class I shares of the Navellier Mid Cap Growth Portfolio,
are incorporated by reference to Registrant's Post-Effective Amendment No. 12
as filed on April 30, 1999.
The Registrant undertakes to update this Explanatory Note, as needed, each time
a Post-Effective Amendment is filed.
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<PAGE>
PART A
[LOGO]
THE NAVELLIER
PERFORMANCE FUNDS
THE NAVELLIER MID CAP GROWTH PORTFOLIO
CLASS I SHARES
INVESTING FOR
LONG-TERM CAPITAL GROWTH
Prospectus dated December 28, 1999
THIS PROSPECTUS CONTAINS INFORMATION PERTAINING ONLY TO THE NAVELLIER MID CAP
GROWTH PORTFOLIO - CLASS I SHARES.
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS OR ANY
OTHER MUTUAL FUND PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
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(THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY)
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TABLE OF CONTENTS
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<TABLE>
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INTRODUCING OUR PORTFOLIO..................................
MID CAP GROWTH PORTFOLIO....................................
FINANCIAL HIGHLIGHTS........................................
WHO IS RESPONSIBLE FOR THE PORTFOLIO........................
Investment advisor......................................
Distributor.............................................
ACCOUNT POLICIES............................................
UNDERSTANDING EARNINGS......................................
UNDERSTANDING TAXES.........................................
HOW TO BUY, SELL, AND EXCHANGE SHARES.......................
Buying shares...........................................
Selling or exchanging shares............................
Buying or selling through selected broker-dealers.......
NEED TO KNOW MORE? (BACK COVER).............................
</TABLE>
More detailed information on subjects covered in this prospectus are
contained within the Statement of Additional Information (SAI). Investors
seeking a more in-depth explanation of the Navellier Mid Cap Growth
Portfolio should request the SAI to review it before purchasing shares of
the Portfolio.
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INTRODUCING OUR PORTFOLIO
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WHO SHOULD INVEST IN OUR PORTFOLIO?
The Navellier Mid Cap Growth Portfolio, like the other Navellier Performance
Portfolios, uses an aggressive investment style suitable for investors
willing to accept more risk and tolerate more price fluctuations while
seeking higher than average returns. This Portfolio is for investors who can
keep their money invested for longer periods, preferably at least five
years, without needing to rely on this money for other purposes. The
Navellier Mid Cap Growth Portfolio is not suitable for investors seeking
current income.
ONE INVESTMENT GOAL FOR ALL OUR PORTFOLIOS
All Navellier Performance Portfolios have the same investment goal: to
achieve long-term capital growth -- in other words, to increase the value of
your investment over time. The investment goal of each Portfolio can only be
changed with shareholder approval.
CLASS I SHARES
Class I shares are available for purchase exclusively by registered
investment advisers and their clients. The minimum purchase per account
is $250,000 for the Class I shares of Navellier Mid Cap Growth Portfolio.
Class I shares are "no-load." This means there is no initial sales charge
for buying or selling shares. There is also no Rule 12b-1 distribution
fee and the Portfolio's adviser currently waives a percentage of its
administrative fee. As a result of the relatively lower expenses for
Class I shares, the level of income dividends per share (as a percentage
of net asset value) and, therefore, the overall investment return,
typically will be higher for Class I shares than for the Portfolio's
initial class of shares.
KEY DEFINITIONS
"We", "Us" and "Our" -- means the Navellier Performance Fund.
"You" and "Your" -- mean the prospective investor.
"Fund" -- means all eight Navellier Performance Portfolios.
"Portfolio" -- refers to the Mid Cap Growth Portfolio.
"Market capitalization" -- means the number of shares available for trading
multiplied by the price per share.
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YEAR 2000 COMPLIANCE.
MOST COMPUTER SYSTEMS TODAY RECOGNIZE ONLY TWO DIGIT DATES (E.G. 99 INSTEAD
OF 1999). THESE SAME SYSTEMS WITHOUT THE PROPER CHANGES WILL RECOGNIZE 00 AS
THE YEAR 1900. WE HAVE A DETAILED PLAN TO CORRECT POTENTIAL PROBLEMS
ASSOCIATED WITH THIS SITUATION. WE ALSO HAVE A CONTINGENCY PLAN. THE
OBJECTIVE OF OUR CONTINGENCY PLAN IS TO PROVIDE UNINTERRUPTED BUSINESS
SERVICES FOR NAVELLIER?S ADVISORY CLIENTS, INCLUDING THE FUND, DURING PERIODS
WHERE THE POTENTIAL FOR UNPREDICTABLE BUSINESS INTERRUPTIONS IS HIGH.
ALTHOUGH WE CANNOT GUARANTEE THAT WE WILL SUCCESSFULLY COMPLETE OUR PLANS, WE
ARE CONFIDENT THAT OUR SYSTEMS WILL BE ADAPTED IN TIME FOR THE YEAR 2000.
ALTHOUGH WE HAVE ASSURANCES FROM OUR VENDORS THAT THEY WILL ALSO ADAPT THEIR
SYSTEMS IN TIME, WE CAN PROVIDE NO GUARANTEES. WE ALSO HAVE NO CONTROL OVER
THE SYSTEMS OF THE COMPANIES IN WHICH WE INVEST, PARTICULARLY FOREIGN
COMPANIES AND FOREIGN MARKETS WHICH MAY NOT BE AS PREPARED AS U.S. COMPANIES
AND MARKETS. YEAR 2000 PROBLEMS AT ANY COMPANY OR MARKET IN WHICH WE
INVEST MAY HAVE AN ADVERSE IMPACT ON THE VALUE OF THE PORTFOLIO.
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<PAGE>
CUSTOMER ASSISTANCE PHONE NUMBER: 1-800-887-8671
SHAREHOLDER AND ACCOUNT INQUIRIES: 1-800-622-1386
THE NAVELLIER MID CAP GROWTH PORTFOLIO
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THIS PORTFOLIO SEEKS LONG-TERM CAPITAL GROWTH BY INVESTING MAINLY IN STOCKS
OF MID-CAPITALIZATION COMPANIES WHICH ALSO HAVE THE POTENTIAL TO RISE IN
PRICE.
OUR PRINCIPAL STRATEGY
This Portfolio is designed to achieve the highest possible returns while
minimizing risk. Our selection process focuses on fast growing companies
that offer innovative products, services, or technologies to a rapidly
expanding marketplace. We use an objective, "bottom-up," quantitative
screening process designed to identify and select inefficiently priced
growth stocks with superior returns compared to their risk characteristics.
We mainly buy stocks of companies which we believe are poised to rise in
price. Our investment process focuses on "growth" variables including, but
not limited to, earnings growth, reinvestment rate, and operating margin
expansion.
We attempt to uncover stocks with strong return potential and acceptable
risk characteristics. To do this, we use our proprietary computer model to
calculate and analyze a "reward/risk ratio." The reward/risk ratio is
designed to identify stocks with above market average returns and risk
levels which are reasonable for higher return rates.
Our research team then applies two or more sets of criteria to identify the
most attractive stocks. Examples of these criteria include earnings growth,
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profit margins, reasonable price/earnings ratios based on expected future
earnings, and various other fundamental criteria.
Stocks with the best combination of growth ratios are blended into a
diversified portfolio.
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EVERY QUARTER, WE EVALUATE OUR TESTS AND REWEIGHT THEIR INFLUENCE ON THE
COMPUTER MODELS AS NECESSARY. THIS ALLOWS US TO CONTINUOUSLY MONITOR WHICH
FACTORS APPEAR TO BE CURRENTLY IN FAVOR IN THE FINANCIAL MARKETS.
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WHAT WE INVEST IN
Under normal conditions, the Portfolio invests at least 65% of its total
assets in companies with market capitalization between $1.5 and $5 billion.
The remaining 35% may be invested in other types of securities, such as:
- bonds, cash, or cash equivalents, and,
- up to 25% of its total assets in foreign securities traded on the United
States market,
- the Portfolio may invest more than 35% of its assets in other (non Mid
Cap) securities for temporary defensive purposes, if we believe it will
help protect the Portfolio from potential losses, or to meet shareholder
redemptions.
THE PRINCIPAL RISKS
As with any mutual fund, there are risks of investing. We cannot guarantee
we will meet our investment goals. Furthermore, it is possible that you may
lose some or all of your money.
MARKET RISK. Investment in common stocks is subject to the risks of
changing economic, stock market, industry, and company conditions which
could cause the Portfolio's stocks to decrease in value. The companies in
this Portfolio are generally in a rapid growth phase and their stocks tend
to fluctuate in value more often than most securities. Because we invest
aggressively, the Portfolio could experience more price volatility than
less aggressive funds.
LIQUIDITY RISK. Smaller capitalization stocks trade fewer shares than
larger capitalization stocks. This may make shares more difficult to sell
if there are not enough buyers. Although we do not anticipate liquidity
problems, the potential risk exists. You should not invest in this
Portfolio unless you are willing to accept this risk.
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PORTFOLIO TURNOVER.
THE MORE OFTEN STOCKS ARE TRADED, THE MORE A PORTFOLIO WILL BE CHARGED
BROKERAGE COMMISSIONS, DEALER MARK-UPS, AND OTHER TRANSACTION COSTS THAT
LOWER PERFORMANCE. IN ADDITION, SALES OF STOCKS MAY GENERATE CAPITAL GAINS
TAXES. WE DO NOT EXPECT THIS PORTFOLIO TO HAVE A TURNOVER RATE OF MORE THAN
300% EACH YEAR, AND IT MAY BE LOWER. WE WILL GO HIGHER IF IT WILL IMPROVE A
PORTFOLIO'S PERFORMANCE.
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FEES AND EXPENSES OF THE PORTFOLIO
This section will help you understand the fees and operating expenses of
this Portfolio and how they may affect you. You pay the fees shown below
directly to us when you buy or sell shares. Operating expenses are paid each
year by the Portfolio.
FEES. This table describes the fees you may pay if you buy and hold the
Class I shares of this Portfolio. You pay no initial sales charges,
contingent deferred sales charges or 12b-1 distribution fees to buy or sell
Class I shares of the Mid Cap Growth Portfolio.
OPERATING EXPENSES PAID EACH YEAR BY THE PORTFOLIO. This table describes
the operating expenses you may pay if you buy and hold Class I shares of
this Portfolio. Expenses are deducted from the Portfolio's income before
dividends are paid. Some expenses are shared by all the Portfolios and are
allocated on a pro rata basis.
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(as a % of average daily net assets)
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Management Fees................................................. 0.84%
Distribution (and/or service)(12b-1) Fees....................... 0.00%
Other Expenses.................................................. 1.47%
Administration Fees................................. 0.25%
Other Operating Expenses............................ 1.22%
Total Annual Portfolio Operating Expenses (before waiver)....... 2.31%
Expense Reimbursement........................................... 1.32%
Net Total Annual Portfolio Operating Expenses................... 0.99%(1)
</TABLE>
(1) Reflects Navellier's contractual waiver of reimbursement of a portion of
the Portfolio's administration and other operating expenses so that the
net total annual operating expenses paid by the Portfolio do not exceed
0.99%.
FEE EXAMPLE. This example is intended to help you compare the cost of
investing in the Class I shares of the Portfolio with the cost of investing
in other mutual funds.
The example assumes that you invest $10,000 in the Class I shares of
the Portfolio for the time periods indicated and then redeem all of your
shares at the end of those periods. The example also assumes that your
<PAGE>
investment has a 5% return each year and that the Portfolio's operating
expenses remain the same. This example uses net annual operating expenses
for the first year and total operating expenses (i.e., without the
administration fee waiver) for 3 years, 5 years and 10 years. Assuming
the Advisor continues to reimburse the Portfolio, your actual expenses
could be lower. Although your actual costs may be higher or lower, based
on these assumptions your costs would be:
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1 year.................................. $101
3 years................................. $634
5 years................................. $1,088
10 years................................ $2,348
</TABLE>
HOW THE PORTFOLIO HAS PERFORMED
The charts below give some indication of the risks of investing in the Mid
Cap Growth Portfolio.
MID CAP GROWTH
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
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1997 26.18%
1998 12.31%
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* FROM COMMENCEMENT OF OPERATIONS NOVEMBER 26, 1996
YEAR BY YEAR TOTAL RETURN. This chart shows how the Portfolio's
performance has changed from year to year. Fees are not included in this
chart. If they were, the Portfolio's returns would be less than those
shown.
1997 26.18%
1998 12.31%
HIGHEST AND LOWEST QUARTERLY RETURNS. This chart shows the range of
returns experienced by the Portfolio since it began operations on November
26, 1996.
<PAGE>
3rd quarter 1997 - up 17.57% 3rd quarter 1998 - down 13.32%
AVERAGE ANNUAL RETURNS. This chart compares the Portfolio's average annual
returns to the Russell 2000 Growth Index for the same time period. This
information may help provide an indication of the Portfolio's risks and
potential rewards. All figures assume reinvestment of dividends and
distributions. The Portfolio's past performance is not a guarantee of how
it will perform in the future. The sale of Class I shares will begin as
of the date of this Prospectus. There is, therefore, no performance
history for the Class I shares. The average annual return information
shown below is for the initial non-institutional class of shares of the
Mid Cap Growth Portfolio and therefore reflects the deduction of the 12b-1
distribution fee as well as the different fee waiver arrangements that are
in place for the Class I shares.
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<CAPTION>
ONE YEAR SINCE INCEPTION (1)
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Mid Cap Growth Portfolio................ 12.31% 19.66%
Russell 2000 Growth Index............... 1.23% 14.80%
</TABLE>
(1) The effective date of the Mid Cap Growth Portfolio was November 26, 1996.
Performance was measured against the Russell 2000 Growth Index as of
November 26, 1996.
FINANCIAL HIGHLIGHTS
No financial information is presented for the Class I shares of the Portfolio
since no Class I shares have been issued as of the date of this Prospectus.
The following are the financial highlights for the Mid Cap Growth Portfolio
non-institutional shares for the fiscal year ended December 31, 1998.
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<CAPTION>
MID CAP GROWTH
PORTFOLIO
------------------------------------------------
FOR THE YEARS ENDED FOR THE
PERIOD
DECEMBER 31, ENDED
-------------------------------- DECEMBER 31,
1998 1997 1996*
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PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $12.43 $10.27 $10.00
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Income from Investment Operations:
Net Investment Income (Loss)........ (0.06) (0.06) 0.01
Net Realized and Unrealized Gain on
Investments....................... 1.59 2.75 0.27
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Total from Investment
Operations...................... 1.53 2.69 0.28
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Distributions to Shareholders:
From Net Investment Income.......... -- -- (0.01)
From Net Realized Gain.............. (0.31) (0.53) --
------ ------ -------------
Total Distributions to
Shareholders.................... (0.31) (0.53) (0.01)
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Net Increase in Net Asset Value....... 1.22 2.16 0.27
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Net Asset Value -- End of Period...... $13.65 $12.43 $10.27
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TOTAL INVESTMENT RETURN................. 12.31% 26.18% 2.75%(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.66% 2.00% 2.00%(B)
Expenses Before Reimbursement (Note
2).................................. 2.56% 3.27% 113.02%(B)
Net Investment Income (Loss) After
Reimbursement (Note 2).............. (0.38)% (0.69)% 0.87%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (1.27)% (1.96)% (110.15)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 211% 163% --
Net Assets at End of Period (in
thousands).......................... $8,124 $8,373 $1,642
Number of Shares Outstanding at End of
Period (in thousands)............... 595 673 160
</TABLE>
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(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
* FROM COMMENCEMENT OF OPERATIONS NOVEMBER 26, 1996
The Investment Advisor advanced the Fund's organizational expenses which were
$126,000. The Fund has agreed to reimburse the Investment Advisor for the
organizational expenses one fifth per year over five (5) years and other
expenses it advances, without interest at or before the end of the
Portfolio's fiscal year in which the advances were made or the Investment
Advisor can elect at or before the end of said fiscal year to waive
reimbursement of some or all of such advances. No Portfolio shall be
responsible for the reimbursement of more than its proportionate share of
expenses.
WHO IS RESPONSIBLE FOR THE PORTFOLIO
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INVESTMENT ADVISOR
Navellier Management, Inc. is the Investment Advisor to the Mid Cap Growth
Portfolio. Navellier is located at One East Liberty, Third Floor, Reno,
Nevada, 89501.
LOUIS G. NAVELLIER has been the CEO and President of Navellier Management,
Inc. since 1994. He has an aggressive investment style suitable only for
investors willing to accept a little more risk and who can hold stocks
long-term. Mr. Navellier developed a computer model based on an existing
proven model, which identifies attractive stocks to meet the goals of the
Portfolio. He has been advising Portfolio Managers based on his investment
technique since 1987. Mr. Navellier has the final decision making authority
on stock purchases and sales and is ultimately responsible for all decisions
regarding the Portfolio.
<PAGE>
ALAN ALPERS has been the Senior Portfolio Manager and Analyst for Navellier
Management, Inc. since 1994. Mr. Alpers is the portfolio manager of and is
responsible for the daily activities of the Portfolio. He believes that
with Navellier's quantitative and fundamental analysis he can select stocks
that will outperform the overall stock market without exposing investors to
excessive risk.
DISTRIBUTOR
Navellier Securities Corp. is the Distributor for the Fund and is
responsible for the sale and distribution of shares to individual
shareholders, broker-dealers and investment advisers. Mr. Navellier is
100% owner of the Distributor.
ACCOUNT POLICIES
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Here are some important details to know before investing in the Portfolio:
HOW WE PRICE SHARES.
Shares are priced at net asset value (NAV). The net asset value is
calculated by adding the values of all securities and other assets of the
Portfolio, subtracting liabilities, and dividing by the number of
outstanding shares.
WHEN SHARES ARE PRICED.
NAV calculations are made once each day, after the close of trading (4:00
p.m. Eastern Time). Shares are not priced on any national holidays or other
days when the New York Stock Exchange (NYSE) is closed.
IMPORTANT INFORMATION ABOUT FOREIGN STOCK TRADES.
Foreign stock trades may occur on days when the NYSE is closed. As a
result, share values may change when you are unable to buy or sell shares.
NOTIFICATION OF CHANGES.
You will be notified of any significant changes to the Portfolio in
writing at least 90 days before the changes take effect.
WHEN STATEMENTS ARE SENT.
We will send you an account statement at least quarterly.
<PAGE>
UNDERSTANDING EARNINGS
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The Portfolio may pay you dividends or distributions. Here are some specifics
about these earnings:
THREE KINDS OF DIVIDENDS.
Dividends paid to you could be:
- a return of capital (a repayment of the money you invested);
- dividends or interest earned by shares of the stocks in the Portfolio;
- capital gains earned by selling shares of stocks at a profit.
WHEN DIVIDENDS AND DISTRIBUTIONS ARE PAID.
The Portfolio will distribute all of its net investment income and net
realized capital gains (if any) once a year, usually in December.
YOUR CHOICE: SHARES OR CASH.
You may choose to receive dividends or distributions in one of two ways:
- We will automatically reinvest your dividends and distributions in
additional shares of the Portfolio, priced at the net asset value, unless
you ask to be paid in cash. We have the right to alter this policy as long
as we notify you at least 90 days before the record date for a dividend or
distribution; or
- To be paid in cash, you must notify us in writing. Cash payments will be
made by check, mailed to the same address as statements and confirmations,
unless you instruct us otherwise in writing.
WHO RECEIVES A DIVIDEND.
You are entitled to a dividend or distribution if you buy shares before the
close of business (4 p.m. Eastern Time) on the record date (the day the
dividend or distribution is declared). The Portfolio has the right to use
this money until the date of payment to you.
UNDERSTANDING TAXES
- - -----------------------------------------------------------------
Distributions received in cash or additional shares of the Portfolio may be
subject to federal income tax. The following are general rules concerning the
tax consequences of investing in the Navellier Performance Portfolios. Be
sure to consult your tax advisor about the specific tax implications of your
investments.
<PAGE>
TAX CONSEQUENCES OF DIVIDENDS.
Your dividends are taxable in the following ways:
- A return of capital is not taxable to you.
- Dividends and interest earned by the Portfolio are taxable to you as
ordinary income.
- Capital gains distributions are taxable as long-term capital gains,
regardless of how long you have held the shares. When you sell or exchange
shares you will realize a capital gain or loss, depending on the
difference between what your shares cost you and what you receive for
them. A capital gain or loss will be long-term or short-term, depending on
the length of time you held the shares.
WHEN DIVIDENDS ARE TAXABLE.
Dividends are taxable in the year they are declared. You could, therefore,
receive a dividend payment in January that is taxable in the previous year
because it was declared in the previous year.
TAX EXCEPTIONS.
Dividends will not be taxable in the year they are paid if the Portfolio is
being held in a tax-advantaged account, such as an IRA.
GAINS AND LOSSES.
If you sell or exchange shares, you will usually receive either a gain or a
loss (based on the difference between what you paid for the shares and the
price at which you sold or exchanged them). These gains and losses may be
subject to federal income tax, are usually treated as capital gains, and
will be either long-term or short-term depending on how long you held the
shares.
REPORTING.
You must report all dividends and redemptions. You may be subject to a 31%
backup withholding, as required by law. (See the bottom of the back side of
our application.) This amount will be credited against your federal income
tax liabilities.
STATE AND LOCAL TAXES.
Dividends may be subject to state and local taxes.
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BE CAREFUL: TIMING CAN MAKE A DIFFERENCE.
CAPITAL GAINS AND DIVIDENDS REDUCE THE NET ASSET VALUE (NAV) OF EACH PORTFOLIO
SHARE. BEFORE BUYING SHARES, BE AWARE WHEN DIVIDENDS, INCLUDING CAPITAL GAINS
DISTRIBUTIONS, ARE EXPECTED TO BE PAID. IF THEY ARE PAID SHORTLY AFTER YOU
PURCHASE SHARES, THE VALUE OF YOUR SHARES WILL BE REDUCED AND THE DIVIDEND OR
DISTRIBUTION WILL BE TAXABLE TO YOU, EVEN THOUGH THE ACCOUNT WILL HAVE THE SAME
VALUE BEFORE AND AFTER THE DISTRIBUTION.
<PAGE>
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HOW TO BUY, SELL, AND EXCHANGE SHARES
- --------------------------------------------------------------------------------
Here are some general rules to consider:
THREE WAYS TO PLACE ORDERS.
You may place an order with:
- the Distributor, Navellier Securities Corp.;
- the Transfer Agent, Rushmore Trust & Savings, FSB; or
- one of our selected broker-dealers.
PURCHASE MINIMUMS
You may buy Class I shares of the Portfolio for:
- an initial amount of at least $250,000; and,
- additional investments of at least $100.
PRICING.
You receive the next NAV calculated after your properly completed order is
received.
DIVIDENDS.
You will be credited with dividends for shares on the day you purchase
them, but you will not be credited with dividends for shares on the day you
sell them.
WHEN YOU RECEIVE YOUR MONEY.
You may instruct us to deposit the proceeds of a sale into your Rushmore
money market account, or to mail the proceeds. Normally, we will mail your
check within seven days of the redemption. If you sell all your shares, you
will receive an amount equal to the total value of the shares plus all
declared but unpaid dividends. If you buy shares by check and sell them
within the next 15 days, we may delay paying you until after the 15th day
from the purchase date or until the check clears, whichever occurs first.
You can avoid this delay if you wire money to buy shares.
<PAGE>
RESTRICTIONS ON PHONE ORDERS.
You may only sell by phone if you have requested telephone redemption
privileges on your original application. Shares held in an IRA may not be
redeemed by phone. Furthermore, you must wait to sell shares by phone for
at least 30 days after notifying Rushmore Trust & Savings of a change of
address.
CHANGING THE TERMS.
We can change any of the methods of buying or selling after giving you 30
days' written notice.
BUYING SHARES
BY MAIL
FILL OUT AN APPLICATION. Complete an application naming the Portfolio or
Portfolios in which you are investing and how much money is to be invested
in each.
WRITE A CHECK. Make the check payable to "The Navellier Performance Funds."
SEND THE CHECK AND APPLICATION. Mail the check and application to:
The Navellier Performance Funds
c/o Rushmore Trust & Savings, FSB
4922 Fairmont Avenue
Bethesda, MD 20814
Once your check and properly completed application are received, your shares
will be bought at the next determined NAV. For example, if we receive your
check after 4 p.m. Eastern time, the purchase will be made based on the
shares' NAV of the next trading day. If additional information is required,
your application will be considered incomplete until we have received it.
PLEASE NOTE: No foreign checks are accepted.
BY WIRE
CALL YOUR BANK. Tell your bank to send wiring instructions including:
- the Portfolio or Portfolios in which you are investing, and how much is to
be invested in each;
- your Navellier account number;
- the order number (if available);
- your name.
<PAGE>
GIVE THE BANK WIRING INSTRUCTIONS. Send the wire transfer to:
Rushmore Federal Savings Bank
Bethesda, MD
Routing number 0550 71084
For account of The Navellier Performance Funds
Account number 029 385770
FOLLOW UP WITH A PHONE CALL. You must follow up the wire with a phone call
to us at 1-800-622-1386 or 1-301-657-1510 and tell us the amount you wired
and the bank sending the wire.
PLEASE NOTE: You are responsible for any wiring charges from your bank. If
we purchase shares based on your wiring instructions and have to cancel the
purchase because your wire is not received, you may be liable for any loss
the Portfolio may incur.
BY AUTOMATIC PLAN
MAKE MONTHLY PURCHASES. You may make automatic monthly purchases of
Portfolio shares directly from your bank account. Simply complete the
automatic monthly withdrawal application authorizing your bank to transfer
money from your checking account to Rushmore Savings & Trust. This is a free
service, and you may discontinue it at any time.
SELLING SHARES
BY MAIL
SEND THE FOLLOWING INFORMATION. Send a written request including the:
- name of the Portfolio;
- account name and number;
- exact names of each registered account owner;
- number or dollar amount of shares to be sold (or that all shares are to be
sold).
The mailing address is:
The Navellier Performance Funds
c/o Rushmore Trust & Savings, FSB
4922 Fairmont Avenue
Bethesda, MD 20814
BY PHONE
MAKE A PHONE CALL. Call Rushmore Trust & Savings at 1-800-622-1386 by 4 p.m.
Eastern Time to have your shares sold that day.
<PAGE>
HAVE YOUR INFORMATION READY. Provide the proper personal identification
information requested of you. We reserve the right to refuse the order if we
cannot reasonably confirm the authenticity of the instructions.
BY AUTOMATIC PLAN
MAKE REGULAR WITHDRAWALS. If you have a total of $250,000 or more invested
in Navellier Portfolios, you may instruct us to make monthly, quarterly, or
annual payments of any amount above $1,000 to anyone you name. Shares will
be sold on the last business day of each month. Contact us to arrange this
service.
- --------------------------------------------------------------------------------
LIMITED FEDERAL GUARANTEES.
THE PORTFOLIO WILL NORMALLY HOLD LESS THAN 35% OF ITS TOTAL ASSETS IN CASH OR
CASH EQUIVALENTS (SUCH AS MONEY MARKET SECURITIES). THE ASSETS WILL MOST
LIKELY BE DEPOSITED IN INTEREST BEARING ACCOUNTS, MONEY MARKET ACCOUNTS, OR
MONEY MARKET MUTUAL FUNDS WITH RUSHMORE TRUST & SAVINGS, FSB. AN INVESTMENT
IN THE PORTFOLIO IS NOT A BANK DEPOSIT. PLEASE BE AWARE THAT MONEY MARKET
INVESTMENTS HAVE NO FDIC PROTECTION AND THE RUSHMORE INTEREST BEARING ACCOUNT
IS PROTECTED ONLY UP TO $100,000.
- --------------------------------------------------------------------------------
NEED TO KNOW MORE?
- ------------------------------------------------------------------
THE NAVELLIER PERFORMANCE PORTFOLIOS
Additional information is available free of charge in the Annual/Semi-Annual
Report and the Statement of Additional Information (SAI). In our Annual
Report, you will find a discussion of the market conditions and investment
strategies that significantly affected the Fund's performance during the
past fiscal year. The SAI is incorporated by reference (legally considered
part of this document). Documents will be sent within 3 business days of
receipt of request.
The Navellier Performance Portfolios
c/o Navellier Securities Corp.
One East Liberty, Third Floor
Reno, Nevada 89501
1-800-887-8671
Internet address: http://www.navellier.com
The Fund and its investment advisor and principal underwriter have
adopted codes of ethics which prohibit Fund personnel from investing in
securities that may be purchased or held by the Fund.
Information about the Fund (including the SAI and codes of ethics) can be
reviewed and copied at the Commission's Public Reference Room in
Washington, D.C. Information on the operation of the Public Reference
Room may be obtained by calling the Commission at 1-202-942-8090.
Reports and other information about the Fund including information about
the codes of ethics are available on the EDGAR Database on the
Commission's Internet site at http://www.sec.gov). Copies of this
information may be obtained, after paying a duplicating fee, by
electronic request at the following E-mail address: [email protected],
or by writing the Commission's Public Reference Section, Washington,
D.C. 20549-0102.
SEC File Number - 811-9142
<PAGE>
PART B
THE NAVELLIER PERFORMANCE FUNDS
THE NAVELLIER MID CAP GROWTH PORTFOLIO
CLASS I SHARES
STATEMENT OF ADDITIONAL INFORMATION
DATED DECEMBER 28, 1999
THIS STATEMENT OF ADDITIONAL INFORMATION PERTAINS ONLY TO
THE NAVELLIER MID CAP GROWTH PORTFOLIO - CLASS I SHARES
This Statement of Additional Information, which is not a prospectus, should
be read in conjunction with the Prospectus of The Navellier Mid Cap Growth
Portfolio (Class I shares) of The Navellier Performance Funds (the "Fund"),
dated December 28, 1999, a copy of which Prospectus may be obtained, without
charge, by contacting the Fund, at its mailing address c/o Navellier Securities,
Corp., One East Liberty, Third Floor, Reno, Nevada 89501; Tel: 1-800-887-8671.
TABLE OF CONTENTS
GENERAL INFORMATION AND HISTORY. . . . . . . . . . . . . . . . . . . ..
INVESTMENT OBJECTIVES AND POLICIES . . . . . . . . . . . . . . . . . ..
TRUSTEES AND OFFICERS OF THE FUND. . . . . . . . . . . . . . . . . . ..
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES. . . . . . . . . ..
THE INVESTMENT ADVISOR, DISTRIBUTOR,
CUSTODIAN AND TRANSFER AGENT . . . . . . . . . . . . . . . . . . . . .
BROKERAGE ALLOCATION AND OTHER PRACTICES . . . . . . . . . . . . . . . .
CAPITAL STOCK AND OTHER SECURITIES . . . . . . . . . . . . . . . . . . .
PURCHASE, REDEMPTION, AND PRICING OF SHARES. . . . . . . . . . . . . . .
TAXES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
UNDERWRITERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
CALCULATION OF PERFORMANCE DATA. . . . . . . . . . . . . . . . . . . . .
FINANCIAL STATEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . .
APPENDIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
<PAGE>
GENERAL INFORMATION AND HISTORY
The Fund is a business trust company organized under the laws of the State
of Delaware on October 17, 1995.
INVESTMENT OBJECTIVES AND POLICIES
INVESTMENT OBJECTIVE OF THE NAVELLIER MID CAP GROWTH PORTFOLIO
The Investment Objective of the Mid Cap Growth Portfolio ("Portfolio") is to
achieve long-term growth of capital primarily through investment in mid cap
companies with appreciation potential. The Mid Cap Growth Portfolio invests in
equity securities traded in all United States markets including dollar
denominated foreign securities traded in United States markets. It is a
diversified portfolio, meaning it limits its investment in the securities of
any single company (issuer) to a maximum of 5% of the Portfolio assets and
further limits its investments to less than 25% of the Portfolio's assets in
any one industry group. The Mid Cap Growth Portfolio seeks long term capital
appreciation through investments in securities of mid cap companies (companies
with market capitalization of between $1 Billion and $5 Billion) which the
Investment Advisor feels are undervalued in the marketplace. Navellier
Management, Inc. is the Investment Advisor for the Mid Cap Growth Portfolio.
Navellier Securities Corp. is the principal distributor for the Mid Cap Growth
Portfolio's shares. This Portfolio should not be considered suitable for
investors seeking current income.
OTHER INVESTMENTS
While under normal circumstances the Portfolio will invest at least 65%
of its total assets in equity securities, the Portfolio may, for temporary
defensive purposes or to maintain cash or cash equivalents to meet
anticipated redemptions, also invest in debt securities and money market funds
if, in the opinion of the Investment Advisor, such investment will further the
cash needs or temporary defensive needs of the Portfolio. In addition, when the
Investment Advisor feels that market or other conditions warrant it, for
temporary defensive purposes, the Portfolio may retain cash or invest all or
any portion of its assets in cash equivalents, including money market mutual
funds. Under normal conditions, the Portfolio's holdings in such non-equity
securities should not exceed 35% of the total assets of the Portfolio. If the
Portfolio's assets, or a portion thereof, are retained in cash or money market
<PAGE>
funds or money market mutual funds, such cash will, in all probability, be
deposited in interest-bearing or money market accounts or Rushmore's money
market mutual funds. Rushmore Trust & Savings, FSB is also the Fund's
Transfer Agent and Custodian. Cash deposits by the Fund in interest bearing
instruments issued by Rushmore Trust & Savings ("Transfer Agent") will only
be deposited with the Transfer Agent if its interest rates, terms, and
security are equal to or better than could be received by depositing such
cash with another savings institution. Money market investments have no FDIC
protection and deposits in Rushmore Trust & Savings accounts have only
$100,000 protection.
It is anticipated that all of the Portfolio's investments in corporate
debt securities (other than commercial paper) and preferred stocks will be
represented by debt securities and preferred stocks which have, at the time
of purchase, a rating within the four highest grades as determined by Moody's
Investors Service, Inc. (Aaa, Aa, A, Baa) or by Standard & Poor's Corporation
(AAA, AA, A, BBB; securities which are rated BBB/Baa have speculative
characteristics). Although investment-quality securities are subject to market
fluctuations, the risk of loss of income and principal is generally expected
to be less than with lower quality securities. In the event the rating of a
debt security or preferred stock in which the Portfolio has invested drops
below investment grade, the Portfolio will promptly dispose of such investment.
When interest rates go up, the market value of debt securities generally goes
down and long-term debt securities tend to be more volatile than short term debt
securities.
In determining the types of companies which will be suitable for
investment by the Portfolio, the Investment Advisor will screen over 9,000
stocks and will take into account various factors and base its stock
selection on its own model portfolio theory concepts. The Portfolio invests
primarily in what the Investment Advisor believes are undervalued common
stocks believed to have long-term appreciation potential. Stocks are selected
on the basis of an evaluation of factors such as earnings growth, expanding
profit margins, market dominance and/or factors that create the potential for
market dominance, sales growth, and other factors that indicate a company's
potential for growth or increased value. The Portfolio invests at least 65%
of its total assets in equity securities of companies defined as Mid Cap
(companies with capitalization of between $1 Billion and $5 Billion). The
Portfolio will invest up to 100% of its capital in equity securities selected
for their growth potential. The Investment Advisor will typically (but not
always) purchase common stocks of issuers which have records of profitability
and strong earnings momentum. When selecting such stocks for investment by
the Portfolio, the issuers may be lesser known companies moving from a lower
to a higher market share position within their industry groups rather than
the largest and best known companies in such groups.
LACK OF OPERATING HISTORY AND EXPERIENCE
The Mid Cap Growth Portfolio went effective November 26, 1996. The
Investment Advisor was organized on May 28, 1993. Although the Investment
<PAGE>
Advisor sub-contracts a substantial portion of its responsibilities for
administrative services of the Fund's operations to various agents, including
the Transfer Agent and the Custodian, the Investment Advisor still has
overall responsibility for the administration of each of the Portfolios and
oversees the administrative services performed by others as well as servicing
customer's needs and, along with each Portfolio's Trustees, is responsible
for the selection of such agents and their oversight. The Investment Advisor
also has overall responsibility for the selection of securities for
investment for each of the Portfolios.
Louis Navellier, the owner of the Investment Advisor, is also the owner
of another investment advisory firm, Navellier & Associates Inc., which
presently manages over $2 billion in investor funds. Louis Navellier, the
owner of the Investment Advisor, is also the owner of another investment
advisory firm, Navellier Fund Management, Inc., and owns other investment
advisory entities which manage assets and/or act as sub-advisors, all of
which firms employ the same basic modern portfolio theories and select many
of the same over-the-counter stocks and other securities which the Investment
Advisor intends to employ and invest in while managing the Portfolios of the
Fund. Because many of the over-the-counter and other securities which the
Investment Advisor intends to, or may, invest in have a smaller number of
shares available to trade than more conventional companies, lack of shares
available at any given time may result in one or more of the Portfolios of
the Fund not being able to purchase or sell all shares which the Investment
Advisor desires to trade at a given time or period of time, thereby creating
a potential liquidity problem which could adversely affect the performance of
the Fund Portfolios. Since the Investment Advisor will be trading on behalf
of the various Portfolios of the Fund in some or all of the same securities
at the same time that Navellier & Associates Inc., Navellier Fund Management,
Inc. and other Navellier controlled investment entities are trading, the
potential liquidity problem could be exacerbated. In the event the number of
shares available for purchase or sale in a security or securities is limited
and therefore the trade order cannot be fully executed at the time it is
placed, i.e., where the full trade orders of Navellier & Associates Inc.,
Navellier Fund Management, Inc., and other Navellier controlled investment
entities and the Fund cannot be completed at the time the order is made,
Navellier & Associates, Inc., and the other Navellier controlled investment
entities and the Investment Advisor will allocate their purchase or sale
orders in proportion to the dollar value of the order made by the other
Navellier entities, and the dollar value of the order made by the Fund. For
example, if Navellier & Associates Inc., and Navellier Fund Management, Inc.,
each place a $25,000 purchase order and Investment Advisor on behalf of the
Fund places a $50,000 purchase order for the same stock and only $50,000
worth of stock is available for purchase, the order would be allocated
$12,500 each of the stock to Navellier & Associates Inc., and Navellier Fund
Management, Inc., and $25,000 of the stock to the Fund. As the assets of each
Portfolio of the Fund increase the potential for shortages of buyers or
sellers increases, which could adversely affect the performance of the
various Portfolios. While the Investment Advisor generally
<PAGE>
does not anticipate liquidity problems (i.e., the possibility that the
Portfolio cannot sell shares of a company and therefore the value of those
shares drops) unless the Fund has assets in excess of two billion dollars
(although liquidity problems could still occur when the Fund has assets of
substantially less than two billion dollars), each investor is being made
aware of this potential risk in liquidity and should not invest in the Fund
if he, she, or it is not willing to accept this potentially adverse risk, and
by investing, acknowledges that he, she or it is aware of the risks.
An investment in shares of the Portfolio involves certain speculative
considerations. There can be no assurance that the Portfolio's objective will
be achieved or that the value of the investment will increase. The Portfolio
intends to comply with the diversification and other requirements applicable
to regulated investment companies under the Internal Revenue Code.
INVESTMENT POLICIES. The investment objectives and policies of the
Portfolio are described in the Prospectus. The following general policies
supplement the information contained in the Prospectus. Also following are
other types of investments in which the Portfolio may invest.
CERTIFICATES OF DEPOSIT. Certificates of deposit are generally short-term,
interest-bearing, negotiable certificates issued by banks or savings and loan
associations against funds deposited in the issuing institution.
TIME DEPOSITS. Time deposits are deposits in a bank or other financial
institution for a specified period of time at a fixed interest rate for which a
negotiable certificate is not received.
BANKER'S ACCEPTANCES. A banker's acceptance is a time draft drawn on a
commercial bank by a borrower usually in connection with an international
commercial transaction (to finance the import, export, transfer, or storage of
goods). The borrower, as well as the bank, is liable for payment, and the bank
unconditionally guarantees to pay the draft at its face amount on the maturity
date. Most acceptances have maturities of six months or less and are traded in
secondary markets prior to maturity.
COMMERCIAL PAPER. Commercial paper refers to short-term, unsecured
promissory notes issued by corporations to finance short-term credit needs.
Commercial paper is usually sold on a discount basis and has a maturity at the
time of issuance not exceeding nine months.
CORPORATE DEBT SECURITIES. Corporate debt securities with a remaining
maturity of less than one year tend to become liquid and can sometimes be traded
as money market securities.
UNITED STATES GOVERNMENT OBLIGATIONS. Securities issued or guaranteed as
to principal and interest by the United States government include a variety of
Treasury securities, which differ only in their interest rates, maturities, and
<PAGE>
times of issuance. Treasury bills have a maturity of one year or less.
Treasury notes have maturities of one to seven years, and Treasury bonds
generally have a maturity of greater than five years.
Agencies of the United States government which issue or guarantee
obligations include, among others, export-import banks of the United States,
Farmers' Home Administration, Federal Housing Administration, Government
National Mortgage Association, Maritime Administration, Small Business
Administration, the Defense Security Assistance Agency of the Department of
Defense, and the Tennessee Valley Authority. Obligations of instrumentalities
of the United States government include securities issued or guaranteed by,
among others, the Federal National Mortgage Associates, Federal Intermediate
Credit Banks, Banks for Cooperatives, and the United States Postal Service.
Some of the securities are supported by the full faith and credit of the United
States government; others are supported by the right of the issuer to borrow
from the Treasury, while still others are supported only by the credit of the
instrumentality.
STOCK INDEX FUTURES. A stock index futures contract (an "Index Future") is
a contract to buy an integral number of units of the relevant index at a
specified future date at a price agreed upon when the contract is made. A unit
is the value at a given time of the relevant index.
INVESTING IN SECURITIES OF FOREIGN ISSUERS
Investments in foreign securities (those which are traded principally in
markets outside of the United States), particularly those of non-governmental
issuers, involve considerations which are not ordinarily associated with
investing in domestic issuers. These considerations include, among others,
changes in currency rates, currency exchange control regulations, the
possibility of expropriation, the unavailability of financial information, the
difficulty of interpreting financial information prepared under laws applicable
to foreign securities markets, the impact of political, social, or diplomatic
developments, difficulties in invoking legal process abroad, and the difficulty
of assessing economic trends in foreign countries. Furthermore, issuers of
foreign securities are subject to different, and often less comprehensive,
accounting, reporting and disclosure requirements than domestic issuers. The
laws of some foreign countries may limit the Portfolio's ability to invest in
securities of certain issuers located in those countries. The securities of some
foreign issuers and securities traded principally in foreign securities markets
are less liquid and at times more volatile than securities of comparable U.S.
issuers and securities traded principally in U.S. securities markets. Foreign
brokerage commissions and other fees are also generally higher than those
charged in the United States. There are also special tax considerations which
apply to securities of foreign issuers and securities traded principally in
foreign securities markets.
<PAGE>
The risks of investing in foreign securities may be intensified in the
case of investments in emerging markets or countries with limited or
developing capital markets. Prices of securities of companies in emerging
markets can be significantly more volatile than prices of securities of
companies in the more developed nations of the world, reflecting the greater
uncertainties of investing in less developed markets and economies. In
particular, countries with emerging markets may have relatively unstable
governments, present the risk of nationalization of businesses, restrictions
on foreign ownership, or prohibitions of repatriation of assets, and may have
less protection of property rights than more developed countries. The
economies of countries with emerging markets may be predominantly based on
only a few industries or dependent on revenues from particular commodities or
on international aid or development assistance, may be highly vulnerable to
changes in local or global trade conditions, and may suffer from extreme and
volatile debt burdens or inflation rates. Local securities markets may trade
a small number of securities and may be unable to respond effectively to
increases in trading volume, potentially making prompt liquidation of
substantial holdings difficult or impossible at times. Consequently,
securities of issuers located in countries with emerging markets may have
limited marketability and may be subject to more abrupt or erratic price
movements. Also, such local markets typically offer less regulatory
protections for investors.
While to some extent the risks to the Portfolio of investing in foreign
securities may be limited, since the Portfolio may not invest more than 25%
of its net asset value in such securities and the Portfolio may only
invest in foreign securities which are traded in the United States securities
markets, the risks nonetheless exist.
The Investment Advisor will use the same basic selection criteria for
investing in foreign securities as it uses in selecting domestic securities as
described in the Prospectus.
INVESTMENT RESTRICTIONS. The Fund's fundamental policies as they affect a
Portfolio cannot be changed without the approval of a vote of a majority of the
outstanding securities of such Portfolio. A proposed change in fundamental
policy or investment objective will be deemed to have been effectively acted
upon with respect to any Portfolio if a majority of the outstanding voting
securities of that Portfolio votes for the matter. Such a majority is defined
as the lesser of (a) 67% or more of the voting shares of the Fund present at a
meeting of shareholders of the Portfolio, if the holders of more than 50% of the
outstanding shares of the Portfolio are present or represented by proxy or
(b) more than 50% of the outstanding shares of the Portfolio. For purposes of
the following restrictions (except the percentage restrictions on borrowing and
illiquid securities -- which percentage must be complied with) and those
contained in the Prospectus: (i) all percentage limitations apply immediately
after a purchase or initial investment; and (ii) any subsequent change in any
applicable percentage resulting from market fluctuations or other changes in the
amount of total assets does not require elimination of any security from the
Portfolio.
<PAGE>
The following investment restrictions are fundamental policies of the
Fund with respect to the Mid Cap Growth Portfolio and may not be changed except
as described above. The Portfolio may not:
1. Purchase any securities on margin; PROVIDED, HOWEVER, that the
Portfolio may obtain short-term credit as may be necessary for the clearance
of purchases and sales of securities.
2. Make cash loans, except that the Fund may purchase bonds, notes,
debentures, or similar obligations which are customarily purchased by
institutional investors whether publicly distributed or not.
3. Make securities loans, except that the Fund may make loans of the
portfolio securities of the Portfolio, provided that the market value of the
securities subject to any such loans does not exceed 33-1/3% of the value of the
total assets (taken at market value) of the Portfolio.
4. Make investments in real estate or commodities or commodity contracts,
including futures contracts, although the Fund may purchase securities of
issuers which deal in real estate or commodities although this is not a primary
objective of the Portfolio.
5. Invest in oil, gas, or other mineral exploration or development
programs, although the Fund may purchase securities of issuers which engage in
whole or in part in such activities.
6. Purchase securities of companies for the purpose of exercising
management or control.
7. Participate in a joint or joint and several trading account in
securities.
8. Issue senior securities or borrow money, except that the Fund may
(i) borrow money only from banks for the Portfolio for temporary or emergency
(not leveraging) purposes, including the meeting of redemption requests, that
might otherwise require the untimely disposition of securities, provided that
any such borrowing does not exceed 10% of the value of the total assets
(taken at market value) of the Portfolio, and (ii) borrow money only from
banks for the Portfolio for investment purposes, provided that (a) after each
such borrowing, when added to any borrowing described in clause (i) of this
paragraph, there is an asset coverage of at least 300% as defined in the
Investment Company Act of 1940, and (b) is subject to an agreement by the
lender that any recourse is limited to the assets of the Portfolio. As an
operating policy, the Portfolio may not invest in portfolio securities while
the amount of borrowing of the Portfolio exceeds 5% of the total assets of
the Portfolio.
<PAGE>
9. Pledge, mortgage, or hypothecate the assets of the Portfolio to an
extent greater than 10% of the total assets of the Portfolio to secure
borrowings made pursuant to the provisions of Item 8 above.
10. Purchase for the Portfolio "restricted securities" (as defined in
Rule 144(a)(3) of the Securities Act of 1933), if, as a result of such purchase,
more than 10% of the net assets (taken at market value) of the Portfolio would
then be invested in such securities nor will the Fund invest in illiquid or
unseasoned securities if as a result of such purchase more than 5% of the net
assets of the Portfolio would be invested in either illiquid or unseasoned
securities.
11. Invest more than 5% of the assets of the Portfolio in securities of
any single issuer.
If a percentage restriction is adhered to at the time of investment, a
later increase or decrease in percentage beyond the specified limit resulting
from a change in values of portfolio securities or amount of net assets shall
not be considered a violation of the restrictions, except as to the 5%, 10% and
300% percentage restrictions on borrowing specified in Restriction Number 8
above.
PORTFOLIO TURNOVER. The Portfolio?s annual rate of portfolio turnover is
calculated by dividing the lesser of purchases or sales of portfolio
securities during the fiscal year by the monthly average of the value of the
Portfolio's securities (excluding from the computation all securities,
including options, with maturities at the time of acquisition of one year or
less). A high rate of portfolio turnover generally involves correspondingly
greater expenses to the Portfolio, including brokerage commission expenses,
dealer mark-ups, and other transaction costs on the sale of securities, which
must be borne directly by the Portfolio. Turnover rates may vary greatly
from year to year as well as within a particular year and may also be
affected by cash requirements for redemptions of the Portfolio's shares and
by requirements which enable the Fund to receive certain favorable tax
treatment. The portfolio turnover rate for the Navellier Mid Cap Growth
Portfolio for the period January 1, 1998 through December 31, 1998 was 211%.
The Fund will attempt to limit the annual portfolio turnover rate of the
Portfolio to 300% or less, however, this rate may be exceeded if in the
Investment Advisor's discretion securities are or should be sold or purchased
in order to attempt to increase the Portfolio's performance. In Wisconsin an
annual portfolio turnover rate of 300% or more is considered a speculative
activity and under Wisconsin statutes could involve relatively greater risks
or costs to the Fund.
TRUSTEES AND OFFICERS OF THE FUND
The Fund's Board of Trustees directs the business and affairs of each
Portfolio of the Fund as well as supervises the Investment Advisor,
Distributor, Transfer Agent and Custodian, as described below.
<PAGE>
The following information is provided with respect to each trustee and
officer of the Fund:
<TABLE>
<CAPTION>
POSITION(S) HELD WITH PRINCIPAL OCCUPATION(S)
NAME AND ADDRESS REGISTRANT AND ITS AFFILIATES DURING PAST FIVE YEARS
- - ---------------- ----------------------------- ----------------------
<S> <C> <C>
Louis Navellier(1) Trustee and President of The Mr. Navellier is and has been
One East Liberty Navellier Performance Funds. the CEO and President of Navellier
Third Floor Mr. Navellier is also the CEO, & Associates Inc., an investment
Reno, NV 89501 President, Secretary, and Treasurer management company since 1988;
Age: 41 of Navellier Management, Inc., a CEO and President of Navellier
Delaware corporation which is the Management, Inc., an investment
Investment Advisor to the Fund. management company since May 10,
Mr. Navellier is also CEO, President, 1993; CEO and President of Navellier
Secretary, and Treasurer of Navellier International Management, Inc.,
Securities Corp., the principal an investment management company,
underwriter of the Fund's shares. since May 10, 1993; CEO and President
of Navellier Securities Corp. since
May 10, 1993; CEO and President of
Navellier Fund Management, Inc., an
investment management company, since
November 30, 1995; and has been publisher
and editor of MPT Review from August 1987
to the present and was publisher and editor
of the predecessor investment advisory
newsletter OTC Insight, which he began in
1980 and wrote through July 1987.
Arnold Langsen(2) Trustee (however, Professor Langsen Professor Langsen is Professor Emeritus
2206 209th Place N.E. provides consulting services to of Financial Economics, School of
Redmond, WA 98053 Navellier & Associates Inc.) Business, California State University
Age: 78 at Hayward (1973-1992); Visiting
Professor, Financial Economics,
University of California at Berkeley
(1984-1987).
Barry Sander Trustee Currently retired as of December 1, 1998,
695 Mistletoe Rd., #2 formerly he was the President and CEO of Ursa
Ashland, OR 97520 Major Inc., a stencil manufacturing firm
Age: 51 and had been for the past nine years.
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
Joel Rossman Trustee Currently retired as of March 15, 1998.
6 Spanish Bay Court Formerly he was President and CEO of
Petaluma, CA 94954 Personal Stamp Exchange, Inc., a
Age: 50 manufacturer, designer and
distributor of rubber stamp products.
He had been President and CEO of
Personal Stamp Exchange for the
preceding 10 years.
Jacques Delacroix Trustee Professor of Business Administration,
University of Leavy School of Business, Santa Clara
Santa Clara University (1983-present)
Santa Clara, CA
Age: 57
Arjen Kuyper(1) Treasurer Mr. Kuyper is and has been an operations
One East Liberty manager for Navellier & Associates, Inc.
Third Floor since 1992 and operations manager
Reno, NV 89501 for Navellier Management, Inc.
Age: 43 and for Navellier Securities Corp.,
since 1993.
</TABLE>
- -------------------------------
(1) This person is an interested person affiliated with the Investment Advisor.
(2) This person, although technically not an interested person affiliated with
the Investment Advisor, does own a company which provides consulting services to
Navellier & Associates Inc., a company owned by Louis Navellier.
OFFICERS
The officers of the Fund are affiliated with the Investment Advisor and
receive no salary or fee from the Fund. The Fund's disinterested Trustees
are each compensated by the Fund with an annual fee, payable quarterly
(calculated at an annualized rate), of $7,500. The Trustees' fees may be
adjusted according to increased responsibilities if the Fund's assets exceed
one billion dollars. In addition, each disinterested Trustee receives
reimbursement for actual expenses of attendance at Board of Trustees meetings.
The Fund does not expect, in its current fiscal year, to pay aggregate
remuneration in excess of $60,000 for services in all capacities to any (a)
<PAGE>
Trustee, (b) officer, (c) affiliated person of the Fund (other than the
Investment Advisor), (d) affiliated person of an affiliate or principal
underwriter of the Fund, or (e) all Trustees and officers of the Fund as a
group.
The Board of Trustees is permitted by the Fund's By-Laws to appoint an
advisory committee which shall be composed of persons who do not serve the
Fund in any other capacity and which shall have no power to dictate corporate
operations or to determine the investments of the Fund. The Fund currently
has no advisory committee.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------
REMUNERATION TABLE
- ---------------------------------------------------------------------------------
Name Capacity In Which Aggregate
Remuneration Received Remuneration
From
Registrant and
Fund Complex
for the fiscal
year ended
December 31,
1998
- ---------------------------------------------------------------------------------
<S> <C> <C>
Louis G. Navellier Trustee, President and $ 0.00
Chief Executive Officer
- ---------------------------------------------------------------------------------
Barry Sander Trustee $ 7,500.00
- ---------------------------------------------------------------------------------
Arnold Langsen Trustee $ 0.00
- ---------------------------------------------------------------------------------
Joel Rossman Trustee $ 7,500.00
- ---------------------------------------------------------------------------------
Jacques Delacroix Trustee $ 7,500.00
- ---------------------------------------------------------------------------------
</TABLE>
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
Louis Navellier is not a control person of the Fund or of any Portfolio.
<PAGE>
THE INVESTMENT ADVISOR, DISTRIBUTOR,
CUSTODIAN AND TRANSFER AGENT
THE INVESTMENT ADVISOR
Navellier Management, Inc. acts as the Investment Advisor to the Mid Cap
Growth Portfolio of the Fund. The Investment Advisor is registered as an
investment adviser under the Investment Advisers Act of 1940. The Investment
Advisor is responsible for selecting the securities which will constitute the
pool of securities which will be selected for investment for the Portfolio.
Pursuant to a separate Administrative Services Agreement, the Investment
Advisor provides each Portfolio of the Fund with certain administrative
services, including accounting and bookkeeping services and supervising the
Custodian's and Transfer Agent's activities and each Portfolio's compliance
with its reporting obligations. The Investment Advisor may contract (and pay
for out of its own resources including the administrative fee it receives)
for the performance of such services to the Custodian, Transfer Agent, or
others, and may retain all of its 0.25% administrative services fee or may
share some or all of its fee with such other person(s). The Investment Advisor
also provides each Portfolio of the Fund with a continuous investment program
based on its investment research and management with respect to all securities
and investments. The Investment Advisor will determine from time to time what
securities and other investments will be selected to be purchased, retained,
or sold by the various portfolios of the Fund.
The Investment Advisor is owned and controlled by its sole shareholder,
Louis G. Navellier (a 100% stockholder). Louis G. Navellier is an affiliated
person of the Fund and is also the sole owner of the Distributor, Navellier
Securities Corp. Louis Navellier is also the sole shareholder of Navellier &
Associates Inc. Navellier & Associates, Inc. is registered as an investment
adviser with the Securities and Exchange Commission. Louis Navellier is, and has
been, in the business of rendering investment advisory services to significant
pools of capital since 1987.
For information regarding the Fund's expenses and the fees paid to the
Investment Advisor see "Fees and Expenses of the Portfolio" in the Prospectus.
(a) THE INVESTMENT ADVISOR
The offices of the Investment Advisor (Navellier Management,
Inc.) are located at One East Liberty, Third Floor, Reno, Nevada
89501. The Investment Advisor began operation in May 1993 and only
advises this Fund.
(i) The following individuals own the enumerated shares of
outstanding stock of the Investment Advisor and, as a result,
maintain control over the Investment Advisor:
<TABLE>
<CAPTION>
Shares of Outstanding Stock Percentage of
Name of the Investment Advisor Outstanding Shares
- ----- --------------------------- ------------------
<S> <C> <C>
Louis G. Navellier 1,000 100%
</TABLE>
<PAGE>
(ii) The following individuals are affiliated with the Fund,
the Investment Advisor, and the Distributor in the following
capacities:
<TABLE>
<CAPTION>
Name Position
- ----- --------
<S> <C>
Louis G. Navellier Trustee and President of The Navellier
Series Fund; Director, CEO, President,
Secretary, and Treasurer of Navellier
Management, Inc.,; Director, President,
CEO, Secretary, and Treasurer of
Navellier Securities Corp.; one of the
Portfolio Managers of the Aggressive
Growth Portfolio, the Mid Cap Growth
Portfolio, the Aggressive Micro Cap
Portfolio, the Large Cap Growth Portfolio,
the Large Cap Value Portfolio, the Small
Cap Value Portfolio and the Aggressive Small
Cap Equity Portfolio.
Alan Alpers One of the Portfolio Managers of
the Aggressive Growth Portfolio,
the Mid Cap Growth Portfolio,
the Aggressive Micro Cap Portfolio,
the Large Cap Growth Portfolio,
the Large Cap Value Portfolio, the Small
Cap Value Portfolio and the Aggressive Small
Cap Equity Portfolio.
Ram Kolluri Portfolio Manager for Global Value
Investors, Inc. - the Sub-advisor in
charge of the day-to-day investments of
the Navellier International Equity
Portfolio of The Navellier Performance
Funds.
Robert Barnes, Ph.D. Consultant to Navellier Management,
Inc., the Investment Advisor for the
Large Cap Growth Portfolio of The
Navellier Performance Funds.
Arjen Kuyper Treasurer of The Navellier Performance Funds.
</TABLE>
<PAGE>
(iii) The management fees payable to the Investment Advisor under the
terms of the Investment Advisory Agreement (the "Advisory Agreement")
between the Investment Advisor and the Fund are payable monthly and are based
upon 0.84% of the average daily net assets of the Mid Cap Growth Portfolio.
The Investment Advisor has the right, but not the obligation, to waive any
portion or all of its management fee, from time to time.
Navellier Management, Inc. was paid investment advisory fees for
the Mid Cap Growth Portfolio in the following amount for the fiscal year
1998:
Navellier Mid Cap Growth Portfolio
- ----------------------------------
1998 $ 90,643
---------
The Investment Advisor has agreed to limit total annual Portfolio
operating expenses for the Class I shares of the Mid Cap Growth Portfolio
to 0.99% of average daily net assets until December 31, 2000.
During the twelve month period ended December 31, 1998, the Investment
Advisor paid operating expenses of $99,926 for the Mid Cap Growth
Portfolio. The Navellier Performance Funds seek future reimbursement of all
unreimbursed past expense incurred on behalf of the Fund. During the year
ended December 31, 1998, the Adviser paid operating expenses of the Mid Cap
Growth Portfolio totaling $99,926. Under the operating expense agreement,
the Adviser requested, and the Mid Cap Growth Portfolio reimbursed $17,033
of such expenses.
Expenses not expressly assumed by the Investment Advisor under the
Advisory Agreement are paid by the Fund. The Advisory Agreement lists
examples of expenses paid by the Fund for the account of the applicable
Portfolio, the major categories of which relate to taxes, fees to Trustees,
legal, accounting, and audit expenses, custodian and transfer agent expenses,
certain printing and registration costs, and non-recurring expenses,
including litigation.
The Advisory Agreement provides that the Investment Advisor shall not be
liable for any error of judgment or mistake of law or for any loss suffered
by the Fund or its investors except for losses (i) resulting from the willful
misfeasance, bad faith, or gross negligence on its part, (ii) resulting from
reckless disregard by it of its obligations and duties under the Advisory
<PAGE>
Agreement, or (iii) a loss for which the Investment Advisor would not be
permitted to be indemnified under the Federal Securities laws.
(iv) Pursuant to an Administrative Services Agreement, the Investment
Advisor receives an annual fee of .25% of the value of the assets under
management and provides or is responsible for the provision of certain
administrative services to the Fund, including, among others, the preparation
and maintenance of certain books and records required to be maintained by the
Fund under the Investment Company Act of 1940. The Administrative Services
Agreement permits the Investment Advisor to contract out for all of its
duties thereunder; however, in the event of such contracting, the Investment
Advisor remains responsible for the performance of its obligations under the
Administrative Services Agreement. The Investment Advisor has entered into
an agreement with Rushmore Trust & Savings, FSB, to perform, in addition to
custodian and transfer agent services, some or all administrative services
and may contract in the future with other persons or entities to perform some
or all of its administrative services. All of these contracted services are
and will be paid for by the Investment Advisor out of its fees or assets.
Currently, the Advisor waives a portion of its annual administration fee of
0.25% with respect to the Mid Cap Growth Portfolio.
In exchange for its services under the Administrative Services Agreement,
the Fund reimburses the Investment Advisor for certain expenses incurred by
the Investment Advisor in connection therewith but does not reimburse
Investment Advisor (over the amount of 0.25% annual Administrative Services
Fee) to reimburse it for fees Investment Advisor pays to others for
administrative services. The agreement also allows Investment Advisor to pay
to its delegate part or all of such fees and reimbursable expense payments
incurred by it or its delegate.
The Investment Advisory Agreement permits the Investment Advisor to act
as investment adviser for any other person, firm, or corporation, and
designates the Investment Advisor as the owner of the name "Navellier" or any
use or derivation of the word Navellier. If the Investment Advisor shall no
longer act as investment adviser to the Fund, the right of the Fund to use
the name "Navellier" as part of its title may, solely at the Investment
Advisor's option, be withdrawn.
The Investment Advisor advanced the Fund's organizational expenses which
were $126,000. The Fund has agreed to reimburse the Investment Advisor for
the organizational expenses one fifth per year over five (5) years and other
expenses it advances, without interest, at or before the end of the
Portfolio's fiscal year in which the advances were made, or the Investment
Advisor can elect at or before the end of said fiscal year to waive
reimbursement of some or all of such advances. No Portfolio shall be
responsible for the reimbursement of more than its proportionate share of
expenses.
<PAGE>
The Fund and its investment advisor and principal underwriter have
adopted codes of ethics which prohibit Fund personnel from investing in
securities that may be purchased or held by the Fund.
Information about the Fund (including the SAI and codes of ethics) can be
reviewed and copied at the Commission's Public Reference Room in Washington,
D.C. Information on the operation of the Public Reference Room may be
obtained by calling the Commission at 1-202-942-8090. Reports and other
information about the Fund including information about the codes of ethics
are available on the EDGAR Database on the Commission's Internet site at
http://www.sec.gov. Copies of this information may be obtained, after paying
a duplicating fee, by electronic request at the following E-mail address:
[email protected], or by writing the Commission's Public Reference Section,
Washington, D.C. 20549-0102.
(b) THE DISTRIBUTOR
The Fund's Distributor is Navellier Securities Corp., a Delaware
Corporation organized and incorporated on May 10, 1993. Navellier Securities
Corp. is registered as a broker-dealer with the Securities Exchange
Commission and National Association of Securities Dealers and the various
states in which this Fund's securities will be offered for sale by
Distributor and will be registered with such agencies and governments before
any Fund shares are sold by it. The Fund's shares will be continuously
distributed by Navellier Securities Corp. (the "Distributor") located at One
East Liberty, Third Floor, Reno, Nevada 89501, pursuant to a Distribution
Agreement, dated October 17, 1995. The Distribution Agreement obligates the
Distributor to pay certain expenses in connection with the offering of the
shares of the Fund. The Distributor is responsible for any payments made to
its registered representatives as well as the cost of printing and mailing
Prospectuses to potential investors and of any advertising incurred by it in
connection with the distribution of shares of the Fund. The Distributor
receives no compensation from the Fund with respect to distribution of the
Class I shares of the Portfolio.
(c) THE CUSTODIAN AND TRANSFER AGENT
Rushmore Trust & Savings, FSB, 4922 Fairmont Avenue, Bethesda, Maryland
20814, serves as the custodian of the Fund's portfolio securities and as the
Fund's transfer agent and, in those capacities, maintains certain accounting
and other records of the Fund and processes requests for the purchase or the
redemption of shares, maintains records of ownership for shareholders, and
performs certain other shareholder and administrative services on behalf of
the Fund. The Distributor shall be responsible for the review of applications
in order to guarantee that all requisite and statistical information has been
provided with respect to the establishment of accounts.
(d) LEGAL COUNSEL
The Law Offices of Samuel Kornhauser is legal counsel to the Fund.
BROKERAGE ALLOCATION AND OTHER PRACTICES
In effecting portfolio transactions for the Fund, the Investment Advisor
adheres to the Fund's policy of seeking best execution and price, determined as
described below, except to the extent it is permitted to pay higher brokerage
commissions for "brokerage and research services," as defined herein. The
Investment Advisor may cause the Fund to pay a broker or dealer an amount of
commission for effecting a securities transaction in excess of the amount of
commission which another broker or dealer would have charged for effecting the
transaction if the Investment Advisor determines in good faith that such amount
of commission is reasonable in relation to the value of the brokerage and
research services provided by such broker or dealer or that any offset of direct
<PAGE>
expenses of a Portfolio yields the best net price. As provided in Section 28(e)
of the Securities Exchange Act of 1934, "brokerage and research services"
include giving advice as to the value of securities, the advisability of
investing in, purchasing, or selling securities, and the availability of
securities; furnishing analysis and reports concerning issuers, industries,
economic facts and trends, portfolio strategy and the performance of accounts;
and effecting securities transactions and performing functions incidental
thereto (such as clearance and settlement). Brokerage and research services
provided by brokers to the Fund or to the Investment Advisor are considered to
be in addition to and not in lieu of services required to be performed by the
Investment Advisor under its contract with the Fund and may benefit both the
Fund and other clients of the Investment Advisor or customers of or affiliates
of the Investment Advisor. Conversely, brokerage and research services provided
by brokers to other clients of the Investment Advisor or its affiliates may
benefit the Fund.
If the securities in which a particular Portfolio of the Fund invests are
traded primarily in the over-the-counter market, where possible, the Fund will
deal directly with the dealers who make a market in the securities involved
unless better prices and execution are available elsewhere. Such dealers
usually act as principals for their own account. On occasion, securities may be
purchased directly from the issuer. Bonds and money market instruments are
generally traded on a net basis and do not normally involve either brokerage
commissions or transfer taxes.
The determination of what may constitute best execution and price in the
execution of a securities transaction by a broker involves a number of
considerations including, without limitation, the overall direct net economic
result to the Fund (involving both price paid or received and any net
commissions and other costs paid), the efficiency with which the transaction is
effected, the ability to effect the transaction at all where a large block is
involved, the availability of the broker to stand ready to execute possibly
difficult transactions in the future, and the financial strength and stability
of the broker. Such considerations are judgmental and are weighed by the
Investment Advisor in determining the overall reasonableness of brokerage
commissions paid by the Fund. Some portfolio transactions are subject to the
Rules of Fair Practice of the National Association of Securities Dealers, Inc.,
and subject to obtaining best prices and executions, effected through dealers
who sell shares of the Fund.
The Board of Trustees of the Fund will periodically review the performance
of the Investment Advisor of its respective responsibilities in connection with
the placement of portfolio transactions on behalf of the Fund and review the
commissions paid by the Fund over representative periods of time to determine if
they are reasonable in relation to the benefits to the Fund.
The Board of Trustees will periodically review whether the recapture for
the benefit of the Fund of some portion of the brokerage commissions or similar
<PAGE>
fees paid by the Fund on portfolio transactions is legally permissible and
advisable. At present, no recapture arrangements are in effect. The Board of
Trustees will review whether recapture opportunities are available and are
legally permissible, and, if so, will determine, in the exercise of their
business judgment, whether it would be advisable for the Fund to seek such
recapture.
EXPENSES OF THE FUND
GENERAL
Each Portfolio is responsible for the payment of its own expenses. These
expenses are deducted from that Portfolio's investment income before
dividends are paid. These expenses include, but are not limited to: fees paid
to the Investment Advisor, the Custodian and the Transfer Agent; Trustees'
fees; taxes; interest; brokerage commissions; organization expenses;
securities registration ("blue sky") fees; legal fees; auditing fees;
printing and other expenses which are not directly assumed by the Investment
Advisor under its investment advisory or expense reimbursement agreements
with the Fund. General expenses which are not associated directly with a
specific Portfolio (including fidelity bond and other insurance) are
allocated to each Portfolio based upon their relative net assets. The
Investment Advisor may, but is not obligated to, from time to time advance
funds, or directly pay, for expenses of the Fund and may seek reimbursement
of or waive reimbursement of those advanced expenses.
COMPENSATION OF THE INVESTMENT ADVISOR
The Investment Advisor presently receives an annual 0.84% fee for investment
management of the Mid Cap Growth Portfolio. The fee is payable monthly, based
upon the Portfolio's average daily net assets. The Investment Advisor also
receives a 0.25% annual fee (a portion of which is currently being waived) for
rendering administrative services to the Fund pursuant to an Administrative
Services Agreement and is entitled to reimbursement for operating expenses it
advances for the Fund.
BROKERAGE COMMISSIONS
The Investment Advisor may select selected broker-dealers to execute
portfolio transactions for the Portfolios of the Fund, provided that the
commissions, fees, or other remuneration received by such party in exchange for
executing such transactions are reasonable and fair compared to those paid to
other brokers in connection with comparable transactions. In addition, when
selecting broker-dealers for Fund portfolio transactions, the Investment Advisor
may consider the record of such broker-dealers with respect to the sale of
shares of the Fund.
<PAGE>
CAPITAL STOCK AND OTHER SECURITIES
The rights and preferences attached to the shares of each Portfolio are
described in the Prospectus. (See "Description of Shares".) The Investment
Company Act of 1940 requires that where more than one class or series of shares
exists, each class or series must be preferred over all other classes or series
in respect of assets specifically allocated to such class or series. Rule 18f-2
under the Act provides that any matter required to be submitted by the
provisions of the Investment Company Act or applicable state law, or otherwise,
to the holders of the outstanding voting securities of an investment company
such as the Fund shall not be deemed to have been effectively acted upon unless
approved by the holders of a majority of the outstanding shares of each series
affected by such matter. Rule 18f-2 further provides that a series shall be
deemed to be affected by a matter unless the interests of each series in the
matter are substantially identical or that the matter does not affect any
interest of such series. However, the Rule exempts the selection of independent
public accountants, the approval of principal distribution contracts, and the
election of Trustees from the separate voting requirements of the Rule.
Class I shares are available for purchase exclusively by registered
investment advisers and their clients. The minimum purchase per account is
$250,000 for the Class I shares of Navellier Mid Cap Growth Portfolio. Class I
shares are "no-load." This means there is no initial sales charge for buying
or selling shares. There is also no Rule 12b-1 distribution fee and the
Investment Advisor currently waives a percentage of its administrative fee. As
a result of the relatively lower expenses for Class I shares, the level of
income dividends per share (as a percentage of net asset value) and, therefore,
the overall investment return, typically will be higher for Class I shares than
for the Portfolio?s initial class of shares.
DESCRIPTION OF SHARES
The Fund is a Delaware business trust organized on October 17, 1995. The
Declaration of Trust permits the Trustees to issue an unlimited number of
shares of beneficial interest. The Board of Trustees has the power to
designate one or more classes ("Portfolios") of shares of beneficial interest
and to classify or reclassify any unissued shares with respect to such
classes. Presently the Fund is offering shares of eight Portfolios, one of
which--the Navellier Mid Cap Growth Portfolio--is described herein. The
Navellier Mid Cap Growth Portfolio has two classes of shares. As described
above, the Class I shares are only available for purchase by registered
investment advisers and their clients and require a minimum, initial purchase
per account of $250,000.
The shares of each Portfolio, when issued, are fully paid and
non-assessable, are redeemable at the option of the holder, are fully
transferable, and have no conversion or preemptive rights. Shares are also
redeemable at the option of each Portfolio of the Fund when a shareholder's
investment, as a result of redemptions in the Fund, falls below the minimum
investment required by the Fund (see "Redemption of Shares"). Each share of a
<PAGE>
Portfolio is equal as to earnings, expenses, and assets of the Portfolio and, in
the event of liquidation of the Portfolio, is entitled to an equal portion of
all of the Portfolio's net assets. Shareholders of each Portfolio of the Fund
are entitled to one vote for each full share held and fractional votes for
fractional shares held, and will vote in the aggregate and not by Portfolio
except as otherwise required by law or when the Board of Trustees determines
that a matter to be voted upon affects only the interest of the shareholders of
a particular Portfolio. Voting rights are not cumulative, so that the holders of
more than 50% of the shares voting in any election of Trustees can, if they so
choose, elect all of the Trustees. While the Fund is not required, and does not
intend, to hold annual meetings of shareholders, such meetings may be called by
the Trustees at their discretion, or upon demand by the holders of 10% or more
of the outstanding shares of any Portfolio for the purpose of electing or
removing Trustees.
All shares (including reinvested dividends and capital gain distributions)
are issued or redeemed in full or fractional shares rounded to the second
decimal place. No share certificates will be issued. Instead, an account will be
established for each shareholder and all shares purchased will be held in
book-entry form by the Fund.
PURCHASE, REDEMPTION, AND PRICING OF SHARES
Class I shares of the Mid Cap Growth Portfolio are sold on a continuous
basis through the Distributor, the Transfer Agent and the Distributor's
network of broker-dealers.
PURCHASE BY MAIL
Investments in the Portfolio can be made directly to the Distributor or
through the transfer agent--Rushmore Trust & Savings, FSB--or through selected
securities dealers who have the responsibility to transmit orders promptly and
who may charge a processing fee.
TO INVEST BY MAIL: Fill out an application and make a check payable to "The
Navellier Performance Funds." Mail the check along with the application to:
The Navellier Performance Funds
c/o Rushmore Trust & Savings, FSB
4922 Fairmont Avenue
Bethesda, MD 20814
Purchases by check will be credited to an account as of the date the
Portfolio's net asset value is next determined after receipt of payment and a
properly completed account application. Foreign checks will not be accepted.
<PAGE>
Purchase orders which do not specify the Portfolio in which an investment is
to be made will be returned. (See "Purchase and Pricing of Shares--General
Purchasing Information".) Net asset value per share is calculated once daily as
of 4 p.m. E.S.T. on each business day. (See "Purchase and Pricing of
Shares--Valuation of Shares".)
THE MID CAP GROWTH PORTFOLIO
The shares of the Mid Cap Growth Portfolio are sold at their net asset
value per share next determined after an order in proper form (i.e., a
completely filled out application form) is received by the Transfer Agent.
If an order for shares of the Portfolio is received by the Transfer Agent by
4:00 p.m. on any business day, such shares will be purchased at the net asset
value determined as of 4:00 p.m. New York Time on that day. Otherwise, such
shares will be purchased at the net asset value determined as of 4:00 p.m New
York Time on the next business day. However, orders received by the Transfer
Agent from the Distributor or from dealers or brokers after the net asset value
is determined that day will receive such net asset value price if the orders
were received by the Distributor or broker or dealer from its customer prior to
such determination and were transmitted to and received by the Transfer Agent
prior to its close of business on that day (normally 4:00 p.m. New York Time).
Shares are entitled to receive any declared dividends on the day following the
date of purchase.
PURCHASES THROUGH SELECTED DEALERS
Shares purchased through Selected Dealers will be effected at the net asset
value next determined after the Selected Dealer receives the purchase order,
provided that the Selected Dealer transmits the order to the Transfer Agent and
the Transfer Agent accepts the order by 4:00 p.m. New York Time on the day of
determination. See "Valuation of Shares". If an investor's order is not
transmitted and accepted by 4:00 p.m. New York Time, the investor must settle
his or her entitlement to that day's net asset value with the Selected Dealer.
Investors may also purchase shares of the Portfolio by telephone through a
Selected Dealer by having the Selected Dealer telephone the Transfer Agent with
the purchase order. Investors may be charged a transaction fee if they effect
transactions in Fund shares through a broker or agent.
Certain selected Dealers may effect transactions in shares of the Portfolio
through the National Securities Clearing Corporation's Fund/SERV system.
Purchases of shares through Selected Dealers not utilizing the National
Securities Clearing Corporation's Fund/SERV system will be effected when
received in proper form by the Transfer Agent, as described above, in the same
manner and subject to the same terms and conditions as are applicable to shares
purchased directly through the Transfer Agent. There is no sales load charged to
the investor on purchases of the Portfolio, whether purchased through a
Selected Dealer or directly through the Transfer Agent.
<PAGE>
Shareholders who wish to transfer Fund shares from one broker-dealer to
another should contact the Fund at (800) 622-1386.
REDEMPTION OF SHARES. The Prospectus, under "Redemption of Shares"
describes the requirements and methods available for effecting redemption. The
Fund may suspend the right of redemption or delay payment more than seven days
(a) during any period when the New York Stock Exchange or any other applicable
exchange, is closed (other than a customary weekend and holiday closing),
(b) when trading on the New York Stock Exchange, or any other applicable
exchange, is restricted, or an emergency exists as determined by the Securities
and Exchange Commission ("SEC") or the Fund so that disposal of the Fund's
investments or a fair determination of the net asset values of the Portfolios is
not reasonably practicable, or (c) for such other periods as the SEC by order
may permit for protection of the Portfolio's shareholders.
The Fund normally redeems shares for cash. However, the Board of Trustees
can determine that conditions exist making cash payments undesirable. If they
should so determine (and if a proper election pursuant to Rule 18f-1 of the
Investment Company Act has been made by the Fund), redemption payments could be
made in securities valued at the value used in determining net asset value.
There generally will be brokerage and other costs incurred by the redeeming
shareholder in selling such securities.
REDEMPTIONS BY TELEPHONE
If you have indicated on your Account Application that you wish to establish
telephone redemption privileges, you may redeem shares by calling the Transfer
Agent at 1-800-622-1386 by 4:00 p.m. New York Time on any day the New York Stock
Exchange is open for business.
If any account has more than one owner, the Transfer Agent may rely on the
instructions of any one owner. Each Portfolio of the Fund employs reasonable
procedures in an effort to confirm the authenticity of telephone instructions,
which may include giving some form of personal identification prior to acting on
the telephone instructions. If these procedures are not followed, the Fund and
the Transfer Agent may be responsible for any losses because of unauthorized or
fraudulent instructions. By requesting telephone redemption privileges, you
authorize the Transfer Agent to act upon any telephone instructions it believes
to be genuine, (1) to redeem shares from your account and (2) to mail or wire
transfer the redemption proceeds. You cannot redeem shares by telephone until 30
days after you have notified the Transfer Agent of any change of address.
Telephone redemption is not available for shares held in IRAs. Each
Portfolio may change, modify, or terminate its telephone redemption services at
any time upon 30 days' notice.
<PAGE>
FURTHER REDEMPTION INFORMATION
Additional documentation (i.e., signature guarantee for redemptions in
excess of $1,000 or verification identification when redemption is by telephone)
regarding a redemption by any means may be required when deemed appropriate by
the Fund and / or the Transfer Agent, and the request for such redemption will
not be considered to have been received in proper form until such additional
documentation has been received. An investor should contact the Fund or the
Transfer Agent to inquire what, if any, additional documentation may be
required.
The Fund reserves the right to modify any of the methods of redemption upon
30 days' written notice to shareholders.
Under certain circumstances (i.e., when the applicable exchange is closed
or trading has been restricted, etc.), the right of redemption may be
suspended or the redemption may be satisfied by distribution of portfolio
securities rather than cash if a proper election pursuant to Rule 18f-1 of
the Investment Company Act has been made by the Fund. Information as to those
matters is set forth herein.
Investors may redeem their shares and instruct the Fund or Transfer Agent,
in writing or by telephone, to either deposit the redemption proceeds in the
money market mutual fund--Fund for Government Investors, Inc.--a regulated
investment company custodied by Rushmore Trust & Savings, FSB, pending further
instructions as to the investor's desire to subsequently reinvest in the Fund or
the investor may direct some other disposition of said redemption proceeds.
DETERMINATION OF NET ASSET VALUE. As described in the Prospectus, the
net asset value of shares of each Portfolio of the Fund is determined once
daily as of 4 p.m. New York time on each day during which the New York Stock
Exchange, or other applicable exchange, is open for trading. The New York
Stock Exchange is scheduled to be closed for trading on the following days:
New Year's Day, Washington's Birthday, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving Day, and Christmas Day. The Board
of Trustees of the Exchange reserves the right to change this schedule. In
the event that the New York Stock Exchange or the national securities
exchanges on which small cap equities are traded adopt different trading
hours on either a permanent or temporary basis, the Board of Trustees of the
Fund will reconsider the time at which net asset value is to be computed.
VALUATION OF ASSETS. In determining the value of the assets of any
Portfolio of the Fund, the securities for which market quotations are readily
available are valued at market value, which is currently determined using the
last reported sale price, or, if no sales are reported - as is the case with
<PAGE>
many securities traded over-the-counter - the last reported bid price. Debt
securities (other than short-term obligations, i.e., obligations which have 60
days or less left to maturity, which are valued on the basis of amortized cost)
are normally valued on the basis of valuations provided by a pricing service
when such prices are believed to reflect the fair value of such securities.
Prices provided by a pricing service may be determined without exclusive
reliance on quoted prices and take into account appropriate factors such as
institution-size trading in similar groups of securities, yield, quality of
issue, trading characteristics, and other market data. All other securities and
assets are valued at their fair value as determined in good faith by the Board
of Trustees, although the actual calculations may be made by persons acting
pursuant to the direction of the Board of Trustees.
TAXES
In the case of a "series fund" (that is, a regulated investment company
having more than one segregated portfolio of investments the beneficial
interests in which are owned by the holders of a separate series of stock), each
investment portfolio is treated as a separate corporation for federal income tax
purposes. The Fund will be deemed a series fund for this purpose and, thus,
each Portfolio will be deemed a separate corporation for such purpose.
Each Portfolio of the Fund intends to qualify as a regulated investment
company for federal income tax purposes. Such qualification requires, among
other things, that each Portfolio (a) make a timely election to be a
regulated investment company, (b) derive at least 90% of its gross income
from dividends, interest, payments with respect to securities loans, and
gains from the sale or other disposition of stock or securities (including
options and futures) or foreign currencies, and (c) diversify its holdings so
that at the end of each fiscal quarter (i) 50% of the market value of its
assets is represented by cash, government securities, securities of other
regulated investment companies, and securities of one or more other issuers
(to the extent the value of the securities of any one such issuer owned by
the Portfolio does not exceed 5% of the value of its total assets and 10% of
the outstanding voting securities of such issuer) and (ii) not more than 25%
of the value of its assets is invested in the securities (other than
government securities and securities of other regulated investment companies)
of any one industry. These requirements may limit the ability of the
Portfolios to engage in transactions involving options and futures contracts.
If each Portfolio qualifies as a regulated investment company, it will not
be subject to federal income tax on its "investment company taxable income"
(calculated by excluding the amount of its net capital gain, if any, and by
excluding the dividends-received and net operating loss deductions) or "net
capital gain" (the excess of its long-term capital gain over its net short-term
capital loss) which is distributed to shareholders. In determining taxable
income, however, a regulated investment company holding stock on the record date
for a dividend is required to include the dividend in income on the later of the
ex-dividend date or the date of acquisition.
<PAGE>
DIVIDENDS AND DISTRIBUTIONS
All dividends and distributions with respect to the shares of any Portfolio
will be payable in shares at net asset value or, at the option of the
shareholder, in cash. Any shareholder who purchases shares of the Portfolio
prior to the close of business on the record date for a dividend or distribution
will be entitled to receive such dividend or distribution. Dividends and
distributions (whether received in shares or in cash) are treated either as
return of capital, ordinary income or long-term capital gain for federal income
tax purposes. Between the record date and the cash payment date, each Portfolio
retains the use and benefits of such monies as would be paid as cash dividends.
Each Portfolio will distribute all of its net investment income and net
realized capital gains, if any, annually in December.
If a cash payment is requested with respect to the Portfolio, a check will
be mailed to the shareholder. Unless otherwise instructed, the Transfer Agent
will mail checks or confirmations to the shareholder's address of record.
The federal income tax laws impose a four percent (4%) nondeductible excise
tax on each regulated investment company with respect to the amount, if any, by
which such company does not meet distribution requirements specified in the
federal income tax laws. Each Portfolio intends to comply with the distribution
requirements and thus does not expect to incur the four percent (4%)
nondeductible excise tax, although the imposition of such excise tax may
possibly occur.
Shareholders will have their dividends and/or capital gain distributions
reinvested in additional shares of the applicable Portfolio(s) unless they elect
in writing to receive such distributions in cash. Shareholders whose shares are
held in the name of a broker or nominee should contact such broker or nominee to
determine whether they want dividends reinvested or distributed.
The automatic reinvestment of dividends and distributions will not relieve
participants of any income taxes that may be payable (or required to be
withheld) on dividends and distributions. (See "Taxes" following.)
In the case of foreign participants whose dividends are subject to U.S.
income tax withholding and in the case of any participants subject to 31%
federal backup withholding, the Transfer Agent will reinvest dividends after
deduction of the amount required to be withheld.
Experience may indicate that changes in the automatic reinvestment of
dividends are desirable. Accordingly, the Fund reserves the right to amend or
<PAGE>
terminate this provision as applied to any dividend or distribution paid
subsequent to written notice of the change sent to shareholders at least 90 days
before the record date for such dividend or distribution.
Dividends paid out of net investment income and net short-term capital
gains of a Portfolio will be taxable to shareholders as ordinary income
regardless of whether such distributions are reinvested in additional shares or
paid in cash. If a portion of a Portfolio's net investment income is derived
from dividends from domestic corporations, a corresponding portion of the
dividends paid out of such income may be eligible for the dividends-received
deduction. Corporate shareholders will be informed as to the portion, if any,
of dividends received by them which will qualify for the dividends-received
deduction.
Dividends paid out of the net capital gain of a Portfolio that are
designated as capital gain dividends by the Fund will be taxable to shareholders
as long-term capital gains regardless of how long the shareholders have held
their shares. Such dividends will not be eligible for the dividends-received
deduction. If shares of the Fund to which such capital gains dividends are
attributable are held by a shareholder for less than 31 days and there is a loss
on the sale or exchange of such shares, then the loss, to the extent of the
capital gain dividend or undistributed capital gain, is treated as a long-term
capital loss.
All distributions, whether received in shares or cash, must be reported by
each shareholder on his federal income tax return. Taxable dividends declared
in October, November, or December of any year and payable to shareholders of
record on a specified date in such a month will be deemed to have been paid by
the Fund and received by such shareholders on December 31 of the year if such
dividend is actually paid by the Fund during January of the following year.
Any dividends paid shortly after a purchase by an investor may have the
effect of reducing the per share net asset value of the investor's shares by the
per share amount of the dividends. Furthermore, such dividends, although in
effect a return of capital, are subject to federal income taxes. Therefore,
prior to purchasing shares of the Fund, the investor should carefully consider
the impact of dividends, including capital gains distributions, which are
expected to be or have been announced.
The redemption of all or part of the shares of a series held by any
shareholder will generally be treated as a sale or exchange unless the
redemption fails to substantially reduce the shareholder's percentage ownership
interest in the related Portfolio (determined for this purpose using certain
specific rules of constructive ownership). Any redemption that does not
substantially reduce a shareholder's percentage ownership interest in a
Portfolio may be treated as a dividend.
If a redemption is treated as a sale or exchange, the shareholder will
generally recognize gain or loss measured by the difference between the
<PAGE>
redemption price and the basis of the shares. This gain will generally be
treated as capital gain (long-term or short-term, depending upon the
shareholder's holding period for the redeemed shares).
On or before January 31 of each year, the Fund will issue to each person
who was a shareholder at any time in the prior year a statement of the federal
income tax status of all distributions made to such shareholder.
Shareholders who fail to provide correct taxpayer identification numbers or
fail to certify as to no loss of exemption from backup withholding or otherwise
fail to comply with applicable requirements of the law relating to backup
withholding will be subject to backup withholding with respect to dividends at
the rate of 31% unless they are corporations or come within other exempt
categories. Any amounts paid as backup withholding will be creditable against
the federal income tax liabilities of the affected shareholders. All
shareholders should consult their own tax advisers with regard to the tax
consequences applicable to their respective investments in the Fund.
The foregoing discussion relates solely to United States federal income tax
laws as applicable to United States persons (that is, citizens and residents of
the United States and domestic corporations, partnerships, trusts, and estates).
Each shareholder who is not a United States person should consult his tax
adviser regarding the United States and non-United States tax consequences of
ownership of shares, including the possibility that distributions by the Fund
may be subject to a United States withholding tax at the rate of 30% (or at a
lower rate under an applicable United States income tax treaty).
Each Portfolio will be subject to a nondeductible excise tax for any year
equal to 4% of the "required distribution" for the year over the "distributed
amount" for the year. For this purpose, the term "required distribution" means,
with respect to any year, the sum of (a) 98% of the Portfolio's "ordinary
income" (that is, its taxable income determined by excluding its net capital
gain, if any, by disallowing the dividends-received and net operating loss
deductions, and by not taking into account any capital gain or loss), (b) 98% of
its net capital gain income (that is, the excess of capital gains over capital
losses) for the one-year period ending on December 31 of the year, and (c) the
"prior year shortfall" (that is, the excess, if any, of the "grossed-up required
distribution" for the prior year over the "distributed amount" for such year).
For this purpose, the term "grossed-up required distribution" means, with
respect to any year, the required distribution for the year (determined by
including 100% of the Portfolio's ordinary income and capital gain net income)
and the term "distributed amount" means, with respect to any year, the sum of
(a) the amount of dividends-paid or deemed paid during the year, (b) any amount
on which the Portfolio is required to pay corporate tax for the year, and
(c) the excess, if any, of the distributed amount for the prior year over the
required distribution for such year.
<PAGE>
The individual Portfolios will not be subject to tax in Delaware for any
year in which they each qualify as a regulated investment company. They may,
however, be subject to such tax for any year in which they do not so qualify and
may be subject to tax in certain other states where they are deemed to be doing
business. Moreover, distributions may be subject to state and local taxes. In
those states which have income tax laws, the tax treatment of such Portfolios
and the tax treatment of shareholders with respect to distributions may be
different from the federal income tax treatment of such persons.
The foregoing is a general summary of the federal income tax consequences
of investing in the Fund to shareholders who are U.S. citizens or U.S.
corporations. Shareholders should consult their own tax advisors about the
tax consequences of an investment in the Fund in light of each shareholder's
particular tax situation. Shareholders should also consult their own tax
advisors about consequences under foreign, state, local or other applicable
tax laws.
UNDERWRITERS
The Fund's shares will be continuously distributed through Navellier
Securities Corp. (the "Distributor") located at One East Liberty, Third Floor,
Reno, Nevada 89501, pursuant to a distribution agreement dated October 17, 1995.
The Distributor has been selling this Fund's shares since December 28, 1995.
The Distributor acts as the sole principal underwriter of the Fund's
shares. Through a network established by the Distributor, the Fund's shares may
also be sold through selected investment brokers and dealers. For a description
of the Distributor's obligations to distribute the Fund's securities, see "The
Investment Advisor, Distributor, Custodian and Transfer Agent - Distributor."
The following table sets forth the remuneration received by Navellier
Securities Corp. ("NSC"), the Distributor, (which is wholly owned by Louis
Navellier) for the following years:
<TABLE>
<CAPTION>
Underwriting
Discounts and Compensation Brokerage Other
Year Commissions on Redemptions Commissions Compensation*
---- ----------- -------------- ----------- -------------
<S> <C> <C> <C> <C>
1995 $ 0 $ 0 $ 0 $ 0
1996 $ 0 $ 0 $ 0 $147,832
1997 $ 0 $ 0 $ 0 $258,601
1998 $ 0 $ 0 $ 0 $325,560
</TABLE>
* These "other compensation" amounts are 12b-1 fees paid to NSC.
<PAGE>
No compensation is paid to the Distributor with respect to the Class I
shares of the Mid Cap Growth Portfolio.
CALCULATION OF PERFORMANCE DATA
Performance information for each Portfolio may appear in advertisements,
sales literature, or reports to shareholders or prospective shareholders.
Performance information in advertisements and sales literature may be expressed
as total return on the applicable Portfolio.
The average annual total return on such Portfolios represents an
annualization of each Portfolio's total return ("T" in the formula below) over a
particular period and is computed by finding the current percentage rate which
will result in the ending redeemable value ("ERV" in the formula below) of a
$1,000 payment* ("P" in the formula below) made at the beginning of a one-,
five-, or ten-year period, or for the period from the date of commencement of
the Portfolio's operation, if shorter ("n" in the formula below). The following
formula will be used to compute the average annual total return for the
Portfolio:
n
P (1 + T) = ERV
In addition to the foregoing, each Portfolio may advertise its total return
over different periods of time by means of aggregate, average, year-by-year, or
other types of total return figures.
The Navellier Mid Cap Growth Portfolio had a total return of 12.31% for the
fiscal year 1998.
Performance information for the Portfolios shall reflect only the
performance of a hypothetical investment in the Portfolios during the particular
time period on which the calculations are based. Performance information should
be considered in light of the investment objectives and policies,
characteristics and quality of the particular Portfolio, and the market
conditions during the given time period, and should not be considered as a
representation of what may be achieved in the future.
Each Portfolio may, from time to time, include in advertisements containing
total return the ranking of those performance figures relative to such figures
for groups of mutual funds categorized by Lipper Analytical Services, or other
services, as having the same investment objectives. The total return may also
<PAGE>
be used to compare the performance of the Portfolio against certain widely
acknowledged outside standards or indices for stock and bond market
performance. The Russell 2000 Index measures the performance of the 2,000
smallest companies in the Russell 3000 Index, which represents approximately
11% of the total market capitalization of the Russell 3000 Index. The
Russell 3000 Index measures the performance of the 3,000 largest US companies
based on total market capitalization, which represents approximately 98% of
the investable US equity market.
As summarized in the Prospectus, the total return of each Portfolio may be
quoted in advertisements and sales literature.
<PAGE>
FINANCIAL STATEMENTS
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1998
<TABLE>
<CAPTION>
AGGRESSIVE AGGRESSIVE MID CAP AGGRESSIVE
SMALL CAP EQUITY GROWTH GROWTH MICRO CAP
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------ ----------- -----------
<S> <C> <C> <C> <C>
ASSETS
Securities at Cost.............................. $ 38,608,845 $ 73,327,987 $ 6,506,213 $ 7,614,556
----------------- ------------ ----------- -----------
----------------- ------------ ----------- -----------
Securities at Value (Note 1).................... $ 47,233,110 $ 83,739,983 $ 8,236,356 $ 9,583,203
Receivable for Securities Sold.................. -- 7,335,903 -- 19,499
Receivable for Shares Sold...................... 198,317 2,032,590 146,515 106,693
Interest Receivable............................. 6,282 13,643 999 700
Dividends Receivable............................ 7,600 27,876 4,613 4,180
Other Receivables............................... -- 162 -- --
Unamortized Organizational Costs (Note 1)....... -- 50,190 -- --
----------------- ------------ ----------- -----------
Total Assets.................................. 47,445,309 93,200,347 8,388,483 9,714,275
----------------- ------------ ----------- -----------
LIABILITIES
Investment Advisory Fee Payable (Note 2)........ 31,752 54,149 6,077 6,611
Administrative Fee Payable (Note 2)............. 9,450 16,116 1,809 1,968
Distribution Plan Fee Payable (Note 4).......... 9,450 16,116 1,809 1,968
Payable for Securities Purchased................ -- 11,407,975 246,315 --
Payable for Shares Redeemed..................... 129,605 242,009 7,517 51,097
Distributions Payable........................... -- 17 205 --
Other Payables and Accrued Expenses............. 5,670 9,669 1,085 1,185
Organizational Expense Payable to Adviser (Note
1)............................................ -- 50,190 -- --
----------------- ------------ ----------- -----------
Total Liabilities............................. 185,927 11,796,241 264,817 62,829
----------------- ------------ ----------- -----------
NET ASSETS........................................ $ 47,259,382 $ 81,404,106 $ 8,123,666 $ 9,651,446
----------------- ------------ ----------- -----------
----------------- ------------ ----------- -----------
SHARES OUTSTANDING................................ 2,955,086 5,491,448 594,970 472,643
----------------- ------------ ----------- -----------
----------------- ------------ ----------- -----------
NET ASSET VALUE PER SHARE......................... $15.99 $14.82 $13.65 $20.42
------ ------ ----------- -----------
------ ------ ----------- -----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
DECEMBER 31, 1998
<TABLE>
<CAPTION>
SMALL CAP LARGE CAP LARGE CAP INTERNATIONAL
VALUE GROWTH VALUE EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ----------- -------------
<S> <C> <C> <C> <C>
ASSETS
Securities at Cost.................................. $ 903,631 $ 1,913,476 $ 597,849 $10,540,605
----------- ----------- ----------- -------------
----------- ----------- ----------- -------------
Securities at Value (Note 1)........................ $ 857,044 $ 2,464,624 $ 652,673 $10,338,011
Receivable for Securities Sold...................... -- 52,425 -- --
Receivable for Shares Sold.......................... -- 11,513 58 --
Interest Receivable................................. 129 264 70 2,510
Dividends Receivable................................ 1,081 1,251 3,586 1,846
Unamortized Organizational Costs (Note 1)........... 73,440 73,440 73,440 73,440
----------- ----------- ----------- -------------
Total Assets...................................... 931,694 2,603,517 729,827 10,415,807
----------- ----------- ----------- -------------
LIABILITIES
Investment Advisory Fee Payable (Note 2)............ 653 1,661 492 8,374
Administrative Fee Payable (Note 2)................. 194 494 164 2,094
Distribution Plan Fee Payable (Note 4).............. 194 494 164 2,094
Payable for Securities Purchased.................... -- 125,584 -- --
Payable for Shares Redeemed......................... -- -- -- 1,265
Distributions Payable............................... -- -- 30 --
Other Payables and Accrued Expenses................. 117 297 98 2,094
Organizational Expense Payable to Adviser (Note
1)................................................ 73,440 73,440 73,440 73,440
----------- ----------- ----------- -------------
Total Liabilities................................. 74,598 201,970 74,388 89,361
----------- ----------- ----------- -------------
NET ASSETS............................................ $ 857,096 $ 2,401,547 $ 655,439 $10,326,446
----------- ----------- ----------- -------------
----------- ----------- ----------- -------------
SHARES OUTSTANDING.................................... 93,069 165,990 57,553 990,083
----------- ----------- ----------- -------------
----------- ----------- ----------- -------------
NET ASSET VALUE PER SHARE............................. $9.21 $14.47 $11.39 $10.43
----- ----------- ----------- ------
----- ----------- ----------- ------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
AGGRESSIVE SMALL AGGRESSIVE MID CAP AGGRESSIVE
CAP EQUITY GROWTH GROWTH MICRO CAP
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------ ----------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest (Note 1)................................. $ 196,099 $ 267,860 $ 34,335 $ 35,023
Dividends (Note 1)................................ 266,225 396,072 84,676 40,669
----------------- ------------ ----------- -----------
Total Investment Income......................... 462,324 663,932 119,011 75,692
----------------- ------------ ----------- -----------
EXPENSES
Investment Advisory Fee (Note 2).................. 591,904 870,444 90,643 90,856
Administrative Fee (Note 2)....................... 136,969 218,920 23,121 23,621
Distribution Plan Fees (Note 4)................... 48,212 218,290 23,157 14,331
Transfer Agent and Custodian Fee (Note 3)......... 146,185 160,728 62,467 62,782
Shareholder Reports and Notices................... 79,524 91,123 12,395 15,586
Registration Fees................................. 55,433 17,789 17,280 20,628
Organizational Expense (Note 1)................... 767 25,200 -- --
Audit Fees........................................ 18,100 23,600 1,950 2,350
Trustees' Fees and Expenses (Note 2).............. 1,784 3,388 3,388 3,388
Other Expenses.................................... 3,431 23,693 2,446 3,040
----------------- ------------ ----------- -----------
Total Expenses.................................. 1,082,309 1,653,175 236,847 236,582
Less Expenses Reimbursed by Investment Adviser
(Note 2)...................................... (187,573) (181,272) (82,893) (93,800)
----------------- ------------ ----------- -----------
Net Expenses.................................. 894,736 1,471,903 153,954 142,782
----------------- ------------ ----------- -----------
NET INVESTMENT LOSS................................. (432,412) (807,971) (34,943) (67,090)
----------------- ------------ ----------- -----------
Net Realized Gain (Loss) on Investment
Transactions...................................... (338,976) 10,857,763 600,569 (593,873)
Change in Net Unrealized Appreciation of
Investments....................................... 686,288 262,591 485,817 938,282
----------------- ------------ ----------- -----------
NET GAIN ON INVESTMENTS............................. 347,312 11,120,354 1,086,386 344,409
----------------- ------------ ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS........................................ $ (85,100) $ 10,312,383 $ 1,051,443 $ 277,319
----------------- ------------ ----------- -----------
----------------- ------------ ----------- -----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 1998
<TABLE>
<CAPTION>
SMALL CAP LARGE CAP LARGE CAP INTERNATIONAL
VALUE GROWTH VALUE EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ----------- -------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest (Note 1)........................................ $ 2,565 $ 2,871 $ 2,060 $ 33,109
Dividends (Note 1)....................................... 13,169 7,164 14,251 72,300
----------- ----------- ----------- -------------
Total Investment Income................................ 15,734 10,035 16,311 105,409
----------- ----------- ----------- -------------
EXPENSES
Investment Advisory Fee (Note 2)......................... 5,147 7,956 3,950 65,510
Administrative Fee (Note 2).............................. 1,487 2,285 1,316 16,378
Distribution Plan Fee (Note 4)........................... 1,464 2,298 1,321 16,487
Transfer Agent and Custodian Fee (Note 3)................ 28,972 30,396 28,594 81,574
Organizational Expense (Note 1).......................... 18,360 18,360 18,360 18,360
Registration Fees........................................ 8,114 8,114 8,207 7,838
Audit Fees............................................... 8,000 8,000 8,000 3,000
Trustees' Fees and Expenses (Note 2)..................... 3,388 3,388 3,388 3,388
Shareholder Reports and Notices.......................... 2,131 2,155 1,914 2,321
Other Expenses........................................... 45 59 80 276
----------- ----------- ----------- -------------
Total Expenses......................................... 77,108 83,011 75,130 215,132
Less Expenses Reimbursed by Investment Adviser (Note
2)................................................... (68,024) (69,011) (67,670) (100,379)
----------- ----------- ----------- -------------
Net Expenses......................................... 9,084 14,000 7,460 114,753
----------- ----------- ----------- -------------
NET INVESTMENT INCOME (LOSS)............................... 6,650 (3,965) 8,851 (9,344)
----------- ----------- ----------- -------------
Net Realized Gain (Loss) on Investment Transactions........ (49,214) (51,859) 18,166 232,783
Net Realized Gain on Foreign Currency Transactions......... -- -- -- 282
Change in Net Unrealized Appreciation/Depreciation of
Investments.............................................. (47,797) 548,665 53,686 (202,622)
----------- ----------- ----------- -------------
NET GAIN (LOSS) ON INVESTMENTS............................. (97,011) 496,806 71,852 30,443
----------- ----------- ----------- -------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS............................................... $ (90,361) $ 492,841 $ 80,703 $ 21,099
----------- ----------- ----------- -------------
----------- ----------- ----------- -------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
AGGRESSIVE SMALL CAP EQUITY AGGRESSIVE GROWTH
PORTFOLIO PORTFOLIO
----------------------------- -----------------------------
FOR THE YEARS ENDED
DECEMBER 31,
-------------------------------------------------------------
1998 1997 1998 1997
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES
Net Investment Loss................... $ (432,412) $ (1,378,702) $ (807,971) $ (1,040,691)
Net Realized Gain (Loss) on Investment
Transactions........................ (338,976) 25,247,521 10,857,763 11,968,088
Change in Net Unrealized Appreciation
of Investments...................... 686,288 (28,940,108) 262,591 321,088
------------- ------------- ------------- -------------
Net Increase (Decrease) in Net
Assets Resulting from
Operations........................ (85,100) (5,071,289) 10,312,383 11,248,485
------------- ------------- ------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS
From Net Realized Gain................ -- (14,124,008) -- (1,178,202)
------------- ------------- ------------- -------------
FROM SHARE TRANSACTIONS
Net Proceeds from Sales of Shares..... 69,506,803 60,192,194 267,578,704 148,051,404
Reinvestment of Distributions......... -- 13,539,639 -- 1,148,045
Cost of Shares Redeemed............... (95,041,562) (171,691,808) (298,233,289) (152,769,712)
------------- ------------- ------------- -------------
Net Decrease in Net Assets Resulting
from Share Transactions........... (25,534,759) (97,959,975) (30,654,585) (3,570,263)
------------- ------------- ------------- -------------
TOTAL INCREASE (DECREASE) IN NET
ASSETS............................ (25,619,859) (117,155,272) (20,342,202) 6,500,020
NET ASSETS -- Beginning of Year......... 72,879,241 190,034,513 101,746,308 95,246,288
------------- ------------- ------------- -------------
NET ASSETS -- End of Year............... $ 47,259,382 $ 72,879,241 $ 81,404,106 $ 101,746,308
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
SHARES
Sold.................................. 4,515,915 4,277,974 20,345,331 11,764,667
Issued in Reinvestment of
Distributions....................... -- 846,228 -- 86,384
Redeemed.............................. (6,115,945) (11,252,090) (22,510,476) (11,968,178)
------------- ------------- ------------- -------------
Net Decrease in Shares.............. (1,600,030) (6,127,888) (2,165,145) (117,127)
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
MID CAP GROWTH
PORTFOLIO
----------------------------- AGGRESSIVE MICRO CAP
PORTFOLIO
FOR THE YEARS ---------------------------------
ENDED FOR THE YEAR FOR THE PERIOD
DECEMBER 31, ENDED ENDED
----------------------------- DECEMBER 31, DECEMBER 31,
1998 1997 1998 1997*
------------- ------------- -------------- ----------------
<S> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES
Net Investment Loss................... $ (34,943) $ (41,193) $ (67,090) $ (26,415)
Net Realized Gain (Loss) on Investment
Transactions........................ 600,569 317,596 (593,873) 415,737
Change in Net Unrealized Appreciation
of Investments...................... 485,817 1,208,882 938,282 1,030,365
------------- ------------- -------------- ----------------
Net Increase in Net Assets Resulting
from Operations................... 1,051,443 1,485,285 277,319 1,419,687
------------- ------------- -------------- ----------------
DISTRIBUTIONS TO SHAREHOLDERS
From Net Realized Gain................ (174,079) (341,588) -- (180,781)
------------- ------------- -------------- ----------------
FROM SHARE TRANSACTIONS
Net Proceeds from Sales of Shares..... 14,064,660 7,858,965 16,347,179 13,757,919
Reinvestment of Distributions......... 170,002 336,620 -- 176,182
Cost of Shares Redeemed............... (15,360,950) (2,608,712) (17,163,447) (4,982,612)
------------- ------------- -------------- ----------------
Net Increase (Decrease) in Net
Assets Resulting from Share
Transactions...................... (1,126,288) 5,586,873 (816,268) 8,951,489
------------- ------------- -------------- ----------------
TOTAL INCREASE (DECREASE) IN NET
ASSETS............................ (248,924) 6,730,570 (538,949) 10,190,395
NET ASSETS -- Beginning of Period....... 8,372,590 1,642,020 10,190,395 --
------------- ------------- -------------- ----------------
NET ASSETS -- End of Period............. $ 8,123,666 $ 8,372,590 $ 9,651,446 $10,190,395
------------- ------------- -------------- ----------------
------------- ------------- -------------- ----------------
SHARES
Sold.................................. 1,082,352 711,277 825,396 741,820
Issued in Reinvestment of
Distributions....................... 12,658 27,081 -- 8,636
Redeemed.............................. (1,173,434) (224,912) (852,387) (250,822)
------------- ------------- -------------- ----------------
Net Increase (Decrease) in Shares... (78,424) 513,446 (26,991) 499,634
------------- ------------- -------------- ----------------
------------- ------------- -------------- ----------------
</TABLE>
* FROM COMMENCEMENT OF OPERATIONS MARCH 17, 1997
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SMALL CAP
VALUE PORTFOLIO LARGE CAP
----------------------------- GROWTH PORTFOLIO
FOR THE ---------------------------------
FOR THE YEAR PERIOD FOR THE YEAR FOR THE PERIOD
ENDED ENDED ENDED ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997* 1998 1997*
------------- ------------- -------------- ----------------
<S> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES
Net Investment Income (Loss).......... $ 6,650 $ 48 $ (3,965) $ 59
Net Realized Loss on Investment
Transactions........................ (49,214) (49) (51,859) --
Change in Net Unrealized Appreciation
of Investments...................... (47,797) 1,209 548,665 2,482
------------- ------------- -------------- --------
Net Increase (Decrease) in Net
Assets Resulting from
Operations........................ (90,361) 1,208 492,841 2,541
------------- ------------- -------------- --------
DISTRIBUTIONS TO SHAREHOLDERS
From Net Investment Income............ (6,650) (48) -- (59)
------------- ------------- -------------- --------
FROM SHARE TRANSACTIONS
Net Proceeds from Sales of Shares..... 1,107,661 100,000 2,553,343 100,000
Reinvestment of Distributions......... 6,650 48 -- 59
Cost of Shares Redeemed............... (261,412) -- (747,178) --
------------- ------------- -------------- --------
Net Increase in Net Assets Resulting
from Share Transactions........... 852,899 100,048 1,806,165 100,059
------------- ------------- -------------- --------
TOTAL INCREASE IN NET ASSETS........ 755,888 101,208 2,299,006 102,541
NET ASSETS -- Beginning of Period....... 101,208 -- 102,541 --
------------- ------------- -------------- --------
NET ASSETS -- End of Period............. $ 857,096 $ 101,208 $ 2,401,547 $ 102,541
------------- ------------- -------------- --------
------------- ------------- -------------- --------
SHARES
Sold.................................. 109,516 10,000 216,274 10,000
Issued in Reinvestment of
Distributions....................... 722 5 -- 6
Redeemed.............................. (27,174) -- (60,290) --
------------- ------------- -------------- --------
Net Increase in Shares.............. 83,064 10,005 155,984 10,006
------------- ------------- -------------- --------
------------- ------------- -------------- --------
</TABLE>
* FROM COMMENCEMENT OF OPERATION DECEMBER 19, 1997
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
LARGE CAP
VALUE PORTFOLIO INTERNATIONAL
----------------------------- EQUITY PORTFOLIO
FOR THE ---------------------------------
FOR THE YEAR PERIOD FOR THE YEAR FOR THE PERIOD
ENDED ENDED ENDED ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997* 1998 1997**
------------- ------------- -------------- ----------------
<S> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES
Net Investment Income (Loss).......... $ 8,851 $ 76 $ (9,344) $ (1)
Net Realized Gain on Investment
Transactions........................ 18,166 -- 232,783 --
Net Realized Gain on Foreign Currency
Transactions........................ -- -- 282
Change in Net Unrealized Appreciation
of Investments...................... 53,686 1,138 (202,622) --
------------- ------------- -------------- -------
Net Increase (Decrease) in Net
Assets Resulting from
Operations........................ 80,703 1,214 21,099 (1)
------------- ------------- -------------- -------
DISTRIBUTIONS TO SHAREHOLDERS
From Net Investment Income............ (8,851) (76) -- --
From Net Realized Gain................ (33,820) -- (226,731) --
------------- ------------- -------------- -------
Total Distributions to
Shareholders...................... (42,671) (76) (226,731) --
------------- ------------- -------------- -------
FROM SHARE TRANSACTIONS
Net Proceeds from Sales of Shares..... 844,096 100,000 11,259,013 10,000
Reinvestment of Distributions......... 42,522 76 226,731 --
Cost of Shares Redeemed............... (370,425) -- (963,665) --
------------- ------------- -------------- -------
Net Increase in Net Assets Resulting
from Share Transactions........... 516,193 100,076 10,522,079 10,000
------------- ------------- -------------- -------
TOTAL INCREASE IN NET ASSETS........ 554,225 101,214 10,316,447 9,999
NET ASSETS -- Beginning of Period....... 101,214 -- 9,999 --
------------- ------------- -------------- -------
NET ASSETS -- End of Period............. $ 655,439 $ 101,214 $10,326,446 $ 9,999
------------- ------------- -------------- -------
------------- ------------- -------------- -------
SHARES
Sold.................................. 75,563 10,000 1,063,405 1,000
Issued in Reinvestment of
Distributions....................... 3,723 8 21,738 --
Redeemed.............................. (31,741) -- (96,060) --
------------- ------------- -------------- -------
Net Increase in Shares.............. 47,545 10,008 989,083 1,000
------------- ------------- -------------- -------
------------- ------------- -------------- -------
</TABLE>
* FROM COMMENCEMENT OF OPERATION DECEMBER 19, 1997
** FROM COMMENCEMENT OF OPERATION DECEMBER 26, 1997
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
AGGRESSIVE
SMALL CAP EQUITY PORTFOLIO**
-----------------------------------------------------------------------------------
FOR THE
PERIOD
FOR THE YEARS ENDED DECEMBER 31, ENDED
------------------------------------------------------------------- DECEMBER 31,
1998 1997 1996 1995 1994*
---------------- ---------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $16.00 $17.79 $15.41 $10.98 $10.00
------- ------- ------------- ------------- -------------
Income from Investment Operations:
Net Investment Loss................. (0.15) (0.30) (0.23) (0.16) (0.08)
Net Realized and Unrealized Gain on
Investments....................... 0.14 2.30(C) 2.61 4.97 1.06
------- ------- ------------- ------------- -------------
Total from Investment
Operations...................... (0.01) 2.00 2.38 4.81 0.98
------- ------- ------------- ------------- -------------
Distributions to Shareholders:
From Net Realized Gain.............. -- (3.79) -- (0.38) --
------- ------- ------------- ------------- -------------
Net Increase in Net Asset Value....... (0.01) (1.79) 2.38 4.43 0.98
------- ------- ------------- ------------- -------------
Net Asset Value -- End of Period...... $15.99 $16.00 $17.79 $15.41 $10.98
------- ------- ------------- ------------- -------------
------- ------- ------------- ------------- -------------
TOTAL INVESTMENT RETURN(A).............. (0.06)% 11.24% 15.44% 43.80% 9.80%
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.63% 2.33% 1.75% 1.75% 1.68%(B)
Expenses Before Reimbursement (Note
2).................................. 1.98% 2.62% 1.86% 2.10% 4.52%(B)
Net Investment Loss After
Reimbursement (Note 2).............. (0.79)% (1.37)% (1.33)% (1.15)% (0.81)%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (1.13)% (1.64)% (1.44)% (1.50)% (3.65)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 145% 184% 137% 170% 140%
Net Assets at End of Period (in
thousands).......................... $47,259 $72,879 $190,035 $105,299 $18,224
Number of Shares Outstanding at End of
Period (in thousands)............... 2,955 4,555 10,683 6,831 1,660
</TABLE>
- -------------------------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
(C) The per share amount does not coincide with the net realized and unrealized
loss for the year because of the timing of sales and redemptions of Fund
shares and the amount of per share realized and unrealized gain and loss at
such time.
* FROM COMMENCEMENT OF OPERATIONS JANUARY 3, 1994
** Financial Highlights include the performance of the Navellier Aggressive
Small Cap Equity Portfolio, a series of the Navellier Series Fund, which
reorganized on July 24, 1998, as a series of the Navellier Performance Funds
(See Note 9).
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
AGGRESSIVE GROWTH
PORTFOLIO
----------------------------------------------------------------
FOR THE
PERIOD
FOR THE YEARS ENDED DECEMBER 31, ENDED
------------------------------------------------ DECEMBER 31,
1998 1997 1996 1995*
---------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $13.29 $12.25 $9.99 $10.00
------- ------------- ------------- ------
Income from Investment Operations:
Net Investment Loss................. (0.15) (0.14) (0.12) --
Net Realized and Unrealized Gain
(Loss) on Investments............. 1.68 1.34 2.38(C) (0.01)
------- ------------- ------------- ------
Total from Investment
Operations...................... 1.53 1.20 2.26 (0.01)
------- ------------- ------------- ------
Distributions to Shareholders:
From Net Realized Gain.............. -- (0.16) -- --
------- ------------- ------------- ------
Net Increase (Decrease) in Net Asset
Value............................... 1.53 1.04 2.26 (0.01)
------- ------------- ------------- ------
Net Asset Value -- End of Period...... $14.82 $13.29 $12.25 $9.99
------- ------------- ------------- ------
------- ------------- ------------- ------
TOTAL INVESTMENT RETURN................. 11.51% 9.77% 22.62% (0.10)%(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.68% 2.00% 2.00% 2.00%(B)
Expenses Before Reimbursement (Note
2).................................. 1.89% 2.15% 2.22% 27.25%(B)
Net Investment Income (Loss) After
Reimbursement (Note 2).............. (0.92)% (1.07)% (1.57)% 2.59%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (1.13)% (1.22)% (1.77)% (12.66)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 237% 247% 169% --
Net Assets at End of Period (in
thousands).......................... $81,404 $101,746 $95,246 $300
Number of Shares Outstanding at End of
Period (in thousands)............... 5,491 7,657 7,774 30
</TABLE>
- -------------------------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
(C) The per share amount does not coincide with the net realized and unrealized
loss for the year because of the timing of sales and redemptions of Fund
shares and the amounts of per share realized and unrealized gain and loss at
such time.
* FROM COMMENCEMENT OF OPERATIONS DECEMBER 28, 1995
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
MID CAP GROWTH
PORTFOLIO
------------------------------------------------
FOR THE YEARS ENDED FOR THE
PERIOD
DECEMBER 31, ENDED
-------------------------------- DECEMBER 31,
1998 1997 1996*
-------- ------------- -------------
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $12.43 $10.27 $10.00
------ ------ -------------
Income from Investment Operations:
Net Investment Income (Loss)........ (0.06) (0.06) 0.01
Net Realized and Unrealized Gain on
Investments....................... 1.59 2.75 0.27
------ ------ -------------
Total from Investment
Operations...................... 1.53 2.69 0.28
------ ------ -------------
Distributions to Shareholders:
From Net Investment Income.......... -- -- (0.01)
From Net Realized Gain.............. (0.31) (0.53) --
------ ------ -------------
Total Distributions to
Shareholders.................... (0.31) (0.53) (0.01)
------ ------ -------------
Net Increase in Net Asset Value....... 1.22 2.16 0.27
------ ------ -------------
Net Asset Value -- End of Period...... $13.65 $12.43 $10.27
------ ------ -------------
------ ------ -------------
TOTAL INVESTMENT RETURN................. 12.31% 26.18% 2.75%(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.66% 2.00% 2.00%(B)
Expenses Before Reimbursement (Note
2).................................. 2.56% 3.27% 113.02%(B)
Net Investment Income (Loss) After
Reimbursement (Note 2).............. (0.38)% (0.69)% 0.87%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (1.27)% (1.96)% (110.15)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 211% 163% --
Net Assets at End of Period (in
thousands).......................... $8,124 $8,373 $1,642
Number of Shares Outstanding at End of
Period (in thousands)............... 595 673 160
</TABLE>
- -------------------------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
* FROM COMMENCEMENT OF OPERATIONS NOVEMBER 26, 1996
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
AGGRESSIVE MICRO CAP
PORTFOLIO
--------------------------------
FOR THE
FOR THE YEAR PERIOD
ENDED ENDED
DECEMBER 31, DECEMBER 31,
1998 1997*
---------------- -------------
<S> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $20.40 $15.64
------ -------------
Income from Investment Operations:
Net Investment Loss................. (0.14) (0.05)
Net Realized and Unrealized Gain on
Investments....................... 0.16 5.17
------ -------------
Total from Investment
Operations...................... 0.02 5.12
------ -------------
Distributions to Shareholders:
From Net Realized Gain.............. -- (0.36)
------ -------------
Net Increase in Net Asset Value....... 0.02 4.76
------ -------------
Net Asset Value -- End of Period...... $20.42 $20.40
------ -------------
------ -------------
TOTAL INVESTMENT RETURN................. 0.10% 32.76%(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.51% 1.55%(B)
Expenses Before Reimbursement (Note
2).................................. 2.50% 3.21%(B)
Net Investment Loss After
Reimbursement (Note 2).............. (0.71)% (0.54)%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (1.70)% (2.20)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 196% 86%
Net Assets at End of Period (in
thousands).......................... $ 9,651 $10,190
Number of Shares Outstanding at End of
Period (in thousands)............... 473 500
</TABLE>
- -------------------------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
* FROM COMMENCEMENT OF OPERATIONS MARCH 17, 1997
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
SMALL CAP VALUE
PORTFOLIO LARGE CAP GROWTH
-------------------------------- PORTFOLIO
FOR THE ---------------------------------
FOR THE YEAR PERIOD FOR THE YEAR FOR THE PERIOD
ENDED ENDED ENDED ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997* 1998 1997*
---------------- ------------- --------------- ---------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $10.12 $10.00 $10.25 $10.00
------ ------ ------ ------
Income from Investment Operations:
Net Investment Income (Loss)........ 0.07 0.01 (0.02) 0.01
Net Realized and Unrealized Gain
(Loss) on Investments............. (0.91) 0.12 4.24 0.25
------ ------ ------ ------
Total from Investment
Operations...................... (0.84) 0.13 4.22 0.26
------ ------ ------ ------
Distributions to Shareholders:
From Net Investment Income.......... (0.07) (0.01) -- (0.01)
------ ------ ------ ------
Net Increase (Decrease) in Net Asset
Value............................... (0.91) 0.12 4.22 0.25
------ ------ ------ ------
Net Asset Value -- End of Period...... $9.21 $10.12 $14.47 $10.25
------ ------ ------ ------
------ ------ ------ ------
TOTAL INVESTMENT RETURN................. (8.28)% 1.25%(A) 41.17% 2.56%(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.53% 1.75%(B) 1.54% 1.90%(B)
Expenses Before Reimbursement (Note
2).................................. 13.01% 7.74%(B) 9.11% 6.66%(B)
Net Investment Income (Loss) After
Reimbursement (Note 2).............. 1.12% 1.94%(B) (0.43)% 2.40%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (10.36)% (4.03)%(B) (8.00)% (2.36)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 85% 2% 80% --
Net Assets at End of Period (in
thousands).......................... $857 $101 $2,402 $103
Number of Shares Outstanding at End of
Period (in thousands)............... 93 10 166 10
</TABLE>
- -------------------------------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
* FROM COMMENCEMENT OF OPERATION DECEMBER 19, 1997
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
LARGE CAP VALUE
PORTFOLIO INTERNATIONAL EQUITY
-------------------------------- PORTFOLIO
FOR THE ---------------------------------
FOR THE YEAR PERIOD FOR THE YEAR FOR THE PERIOD
ENDED ENDED ENDED ENDED
DECEMBER 31, DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997* 1998 1997**
---------------- ------------- --------------- ---------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $10.11 $10.00 $10.00 $10.00
------ ------ ------- -------
Income from Investment Operations:
Net Investment Income (Loss)........ 0.16 0.01 (0.01) --
Net Realized and Unrealized Gain
(Loss) on Investments............. 1.91 0.11 0.67 --
------ ------ ------- -------
Total from Investment
Operations...................... 2.07 0.12 0.66 --
------ ------ ------- -------
Distributions to Shareholders:
From Net Investment Income.......... (0.16) (0.01) -- --
From Net Realized Gain.............. (0.63) -- (0.23) --
------ ------ ------- -------
Total Distributions to
Shareholders.................... (0.79) (0.01) (0.23) --
------ ------ ------- -------
Net Increase in Net Asset Value....... 1.28 0.11 0.43 --
------ ------ ------- -------
Net Asset Value -- End of Period...... $11.39 $10.11 $10.43 $10.00
------ ------ ------- -------
------ ------ ------- -------
TOTAL INVESTMENT RETURN................. 20.48% 1.18%(A) 6.64% --
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.42% 1.50%(B) 1.75% 1.75%(B)
Expenses Before Reimbursement (Note
2).................................. 14.34% 5.03%(B) 3.29% 5.48%(B)
Net Investment Income (Loss) After
Reimbursement (Note 2).............. 1.69% 3.09%(B) (0.14)% (1.75)%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (11.22)% (0.45)%(B) (1.68)% (5.48)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 256% -- 41% --
Net Assets at End of Period (in
thousands).......................... $655 $101 $10,326 $10
Number of Shares Outstanding at End of
Period (in thousands)............... 58 10 990 1
</TABLE>
- -------------------------------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
* FROM COMMENCEMENT OF OPERATION DECEMBER 19, 1997
** FROM COMMENCEMENT OF OPERATION DECEMBER 26, 1997
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1998
1. Significant Accounting Policies
The Navellier Performance Funds (the "Fund") is registered with the
Securities and Exchange Commission under the Investment Company Act of 1940, as
amended, (the "Act") as an open-end investment company which offers its shares
in a series of no-load non-diversified and diversified portfolios. The Fund is
authorized to issue an unlimited number of shares of capital stock with no
stated par value. The Fund currently consists of eight separate portfolios each
with its own investment objectives and policies: the Aggressive Small Cap Equity
Portfolio, a diversified open-end management company portfolio, the Aggressive
Growth Portfolio, a non-diversified open-end management company portfolio, the
Mid Cap Growth Portfolio, a diversified open-end management company portfolio,
the Aggressive Micro Cap Portfolio (formerly the Aggressive Small Cap
Portfolio), a diversified open-end management company portfolio, the Small Cap
Value Portfolio, a diversified open-end management company portfolio, the Large
Cap Growth Portfolio, a non-diversified open-end management company portfolio,
the Large Cap Value Portfolio, a diversified open-end management company
portfolio, and the International Equity Portfolio, a diversified open-end
management company portfolio. The financial statements have been prepared in
conformity with generally accepted accounting principles which permit management
to make certain estimates and assumptions at the date of the financial
statements. The following is a summary of significant accounting policies which
the Fund follows:
(a) Listed securities are valued at the last sales price of the New York
Stock Exchange and other major exchanges. Over-the-Counter securities are
valued at the last sales price. If market quotations are not readily
available, the Board of Trustees will value the Fund's securities in good
faith. The Trustees will periodically review this method of valuation and
recommend changes which may be necessary to assure that the Fund's instruments
are valued at fair value.
(b) Security transactions are recorded on the trade date (the date the
order to buy or sell is executed). Interest income is accrued on a daily
basis. Dividend income is recorded on the ex-dividend date. Realized gains and
losses from securities transactions are computed on an identified cost basis.
(c) Dividends from net investment income are declared and paid annually.
Dividends are re-invested in additional shares unless shareholders request
payment in cash. Net capital gains, if any, are distributed annually.
(d) The Fund intends to comply with the provisions of the Internal Revenue
Code applicable to regulated investment companies and will distribute all net
investment income and capital gains to its shareholders. Therefore, no Federal
income tax provision is required.
(e) Organizational expenses of the Aggressive Growth Portfolio, the Small
Cap Value Portfolio, the Large Cap Growth Portfolio, the Large Cap Value
Portfolio, and the International Equity Portfolio totaling $126,000, $91,800,
$91,800, $91,800, and $91,800, respectively, are being deferred and amortized
over 60 months beginning with the public offering of shares in the portfolios.
Any redemption by an initial investor during the amortization period will be
reduced by a pro rata portion of any of the unamortized organization expenses.
Such proration is to be calculated by dividing the number of initial shares
redeemed by the number of initial shares outstanding at the date of
redemption. At December 31, 1998, the unamortized organization costs of the
Aggressive Growth Portfolio, the Small Cap Value Portfolio, the Large Cap
Growth Portfolio, the Large Cap Value Portfolio, and the International Equity
Portfolio were $50,190, $73,440, $73,440, $73,440 and $73,440, respectively.
2. Investment Advisory Fees and Other Transactions with Afflilates
Investment advisory services are provided by Navellier Management, Inc. (the
"Adviser"). Effective May 1, 1998, under an agreement with the Adviser, the Fund
pays a fee at the annual rate of 0.84% of the daily net assets of the Aggressive
Small Cap Equity Portfolio, the Aggressive Growth Portfolio, the Mid Cap Growth
Portfolio, the Aggressive Micro Cap Portfolio, the Small Cap Value Portfolio,
and the Large Cap Growth Portfolio, 0.75% of the daily net assets of the Large
Cap Value Portfolio, and 1.00% of the daily net assets of the International
Equity Portfolio. The Adviser receives an annual fee equal to 0.25% of the Funds
average daily net assets in connection with the rendering of services under the
administrative services agreement and is reimbursed by the Fund for operating
expenses incurred on behalf of the Fund. An officer and trustee of the Fund is
also an officer and director of the Adviser.
Under an agreement between the Fund and the Adviser related to payment of
operating expenses, the Adviser has reserved the right to seek reimbursement for
the past, present and future operating expenses of the Fund paid by the Adviser,
at any time upon notice to the Fund. At December 31, 1998, the Adviser
voluntarily agreed not to
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
seek future reimbursement of all unreimbursed past expense incurred on behalf of
the Fund. During the year ended December 31, 1998, the Adviser paid operating
expenses of the Aggressive Small Cap Equity Portfolio, the Aggressive Growth
Portfolio, the Mid Cap Growth Portfolio, the Aggressive Micro Cap Portfolio, the
Small Cap Value Portfolio, the Large Cap Growth Portfolio, the Large Cap Value
Portfolio and the International Equity Portfolio totaling $305,224, $345,521,
$99,926, $107,774, $69,010, $70,472, $68,543, and $116,757, respectively. Under
the operating expense agreement, the Adviser requested, and the Aggressive Small
Cap Equity Portfolio, the Aggressive Growth Portfolio, the Mid Cap Growth
Portfolio, the Aggressive Micro Cap Portfolio, the Small Cap Value Portfolio,
the Large Cap Growth Portfolio, the Large Cap Value Portfolio and the
International Equity Portfolio reimbursed, $117,651, $164,249, $17,033, $13,974,
$986, $1,461, $873, and $16,378, respectively, of such expenses. Effective May
1, 1998, the Adviser agreed to limit the total normal expenses of each Portfolio
to 1.49% of average annual net assets, except for the Large Cap Value
Portfolio's expense limitation of 1.40% and the International Equity Portfolio's
expense limitation of 1.75%.
Navellier Securities Corp. (the "Distributor") acts as the Fund's
Distributor and is registered as a broker-dealer under the Securities and
Exchange Act of 1934. The Distributor, which is the principal underwriter of the
Fund's shares, renders its services to the Fund pursuant to a distribution
agreement. An officer and trustee of the Fund is also an officer and director of
the Distributor.
The Fund pays each of its Trustees not affiliated with the Adviser $7,500
annually. For the year ended December 31, 1998, Trustees' fees and expenses
totaled $25,500.
3. Transfer Agent and Custodian
Rushmore Trust and Savings, FSB (Rushmore Trust), provides transfer agency,
dividend disbursing and other shareholder services to the Fund. In addition,
Rushmore Trust serves as custodian of the Fund's assets. Fees paid to Rushmore
Trust are based upon a fee schedule approved by the Board of Trustees.
4. Distribution Plan
The Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1
under the Act, whereby it reimburses the Distributor or others in an amount not
to exceed 0.25% per annum of the average daily net assets of the Aggressive
Small Cap Equity Portfolio, the Aggressive Growth Portfolio, the Mid Cap Growth
Portfolio, the Aggressive Micro Cap Portfolio, the Small Cap Value Portfolio,
the Large Cap Growth Portfolio, the Large Cap Value Portfolio, and the
International Equity Portfolio for expenses incurred in the promotion and
distribution of shares of the Fund. These expenses include, but are not limited
to, the printing of prospectuses, statements of additional information, and
reports used for sales purposes, expenses of preparation of sales literature and
related expenses (including Distributor personnel), advertisements and other
distribution-related expenses, including a prorated portion of the Distributor's
overhead expenses attributable to the distribution of shares. Such payments are
made monthly. The 12b-1 fee includes, in addition to promotional activities, the
amount the Fund may pay to the Distributor or others as a service fee to
reimburse such parties for personal services provided to shareholders of the
Fund and/or the maintenance of shareholder accounts. Such Rule 12b-1 fees are
made pursuant to the Plan and distribution agreements entered into between such
service providers and the Distributor or the Fund directly.
5. Securities Transactions
For the year ended December 31, 1998, purchases and sales (including
maturities) of securities (excluding short-term securities) were as follows:
<TABLE>
<CAPTION>
AGGRESIVE AGGRESSIVE MID CAP AGGRESSIVE
SMALL CAP EQUITY GROWTH GROWTH MICRO CAP
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Purchases.................................... $ 73,746,379 $ 192,553,844 $ 17,779,736 $17,049,010
----------------- ------------- ------------ -------------
----------------- ------------- ------------ -------------
Sales........................................ $ 98,638,433 $ 223,588,024 $ 18,851,872 $17,462,892
----------------- ------------- ------------ -------------
----------------- ------------- ------------ -------------
<CAPTION>
LARGE CAP LARGE CAP INTERNATIONAL
SMALL CAP VALUE GROWTH VALUE EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------- ------------ -------------
<S> <C> <C> <C> <C>
Purchases.................................... $ 1,279,497 $ 2,454,057 $ 1,671,541 $12,352,270
----------------- ------------- ------------ -------------
----------------- ------------- ------------ -------------
Sales........................................ $ 450,444 $ 714,375 $ 1,188,768 $ 2,843,156
----------------- ------------- ------------ -------------
----------------- ------------- ------------ -------------
</TABLE>
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
6. Unrealized Appreciation and Depreciation of Investments
Unrealized appreciation and depreciation as of December 31, 1998, based on
the cost for Federal income tax purposes is as follows:
<TABLE>
<CAPTION>
AGGRESSIVE AGGRESSIVE MID CAP AGGRESSIVE
SMALL CAP EQUITY GROWTH GROWTH MICRO CAP
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------ ----------- -------------
<S> <C> <C> <C> <C>
Gross Unrealized Appreciation.................. $ 9,785,243 $ 11,149,032 $ 1,725,489 $ 2,202,901
Gross Unrealized Depreciation.................. (1,160,978) (919,282) (45,531) (234,254)
----------------- ------------ ----------- -------------
Net Unrealized Appreciation.................... $ 8,624,265 $ 10,229,750 $ 1,679,958 $ 1,968,647
----------------- ------------ ----------- -------------
----------------- ------------ ----------- -------------
Cost of Investments for Federal Income Tax
Purposes...................................... $ 38,608,845 $ 93,510,233 $ 6,556,398 $ 7,614,556
----------------- ------------ ----------- -------------
----------------- ------------ ----------- -------------
</TABLE>
<TABLE>
<CAPTION>
LARGE CAP LARGE CAP INTERNATIONAL
SMALL CAP VALUE GROWTH VALUE EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------ ----------- -------------
<S> <C> <C> <C> <C>
Gross Unrealized Appreciation.................. $ 55,278 $ 547,955 $ 73,772 $ 735,754
Gross Unrealized Depreciation.................. (102,540) (891) (18,948) (943,002)
----------------- ------------ ----------- -------------
Net Unrealized Appreciation (Depreciation)..... $ (47,262) $ 547,064 $ 54,824 $ (207,248)
----------------- ------------ ----------- -------------
----------------- ------------ ----------- -------------
Cost of Investments for Federal Income Tax
Purposes...................................... $ 904,306 $ 1,917,560 $ 597,849 $10,545,259
----------------- ------------ ----------- -------------
----------------- ------------ ----------- -------------
</TABLE>
7. Net Assets
At December 31, 1998, net assets consisted of the following:
<TABLE>
<CAPTION>
AGGRESSIVE AGGRESSIVE MID CAP AGGRESSIVE
SMALL CAP EQUITY GROWTH GROWTH MICRO CAP
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------ ----------- -------------
<S> <C> <C> <C> <C>
Paid-in-Capital................................ $ 42,291,459 $ 62,208,028 $ 6,032,218 $ 8,080,116
Undistributed Net Investment Loss.............. -- -- -- (11,986)
Accumulated Net Realized Gain (Loss) on
Investment Transactions....................... (3,656,342) 8,784,082 361,305 (385,331)
Net Unrealized Appreciation (Depreciation) of
Investments................................... 8,624,265 10,411,996 1,730,143 1,968,647
----------------- ------------ ----------- -------------
NET ASSETS..................................... $ 47,259,382 $ 81,404,106 $ 8,123,666 $ 9,651,446
----------------- ------------ ----------- -------------
----------------- ------------ ----------- -------------
</TABLE>
<TABLE>
<CAPTION>
LARGE CAP LARGE CAP INTERNATIONAL
SMALL CAP VALUE GROWTH VALUE EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------ ----------- -------------
<S> <C> <C> <C> <C>
Paid-in-Capital................................ $ 952,946 $ 1,902,258 $ 616,269 $10,532,078
Accumulated Net Realized Gain (Loss) on
Investment and Foreign Currency
Transactions.................................. (49,263) (51,859) (15,654) (3,010)
Net Unrealized Appreciation (Depreciation) of
Investment and Foreign Currency
Transactions.................................. (46,587) 551,148 54,824 (202,622)
----------------- ------------ ----------- -------------
NET ASSETS..................................... $ 857,096 $ 2,401,547 $ 655,439 $10,326,446
----------------- ------------ ----------- -------------
----------------- ------------ ----------- -------------
</TABLE>
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
8. Federal Income Tax
Permanent differences between tax and financial reporting of net investment
income and net realized gain/ loss are reclassified. As of December 31, 1998,
net investment losses were reclassified to paid-in-capital and accumulated net
realized gain/loss on investment transactions as follows:
<TABLE>
<CAPTION>
AGGRESSIVE SMALL AGGRESSIVE MID CAP
CAP EQUITY GROWTH GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ----------- -------------
<S> <C> <C> <C>
Reduction of paid-in capital.................................. $ 125,792 -- $ (34,943)
Reduction of accumulated net realized gain.................... $ 306,620 $(807,971) --
</TABLE>
<TABLE>
<CAPTION>
LARGE CAP INTERNATIONAL
AGGRESSIVE MICRO GROWTH EQUITY
CAP PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ----------- -------------
<S> <C> <C> <C>
Reduction of paid-in-capital.................................. $ (55,104) $ (3,965) --
Reduction of accumulated net realized gain.................... -- -- $ (9,062)
</TABLE>
Additionally, as of December 31, 1998, the Aggressive Small Cap Equity
Portfolio reclassified $5,397,358 of accumulated net realized gain on
investments to paid-in-capital.
At December 31, 1998, for Federal income tax purposes, the following Funds
had capital loss carryovers which may be applied against future net taxable
realized gains of each succeeding year until the earlier of its utilization or
its expiration:
<TABLE>
<CAPTION>
AGGRESSIVE SMALL LARGE CAP AGGRESSIVE
CAP EQUITY SMALL CAP VALUE GROWTH MICRO CAP
EXPIRES DECEMBER 31, PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- ------------------------------------------- ----------------- ----------------- ----------- -------------
<S> <C> <C> <C> <C>
2005....................................... -- $ 50 -- --
2006....................................... $ 3,656,342 32,827 $ 39,186 $ 422,402
----------------- ------- ----------- -------------
$ 3,656,342 $ 32,877 $ 39,186 $ 422,402
----------------- ------- ----------- -------------
----------------- ------- ----------- -------------
</TABLE>
9. Reorganization
On July 24, 1998, the Navellier Aggressive Small Cap Equity Portfolio of the
Navellier Performance Funds (the "Acquiring Portfolio") acquired all the net
assets of the Navellier Aggressive Small Cap Equity Portfolio of the Navellier
Series Fund (the "Series Fund") pursuant to a plan of reorganization approved by
the Series Fund's shareholders on June 26, 1998. The acquisition was
accomplished by a tax-free exchange of 3,318,156 shares of the Acquiring
Portfolio (valued at $54,597,912) for the 3,318,156 shares of the Series Fund
outstanding on July 24, 1998. Series Fund's net assets at that date
($54,597,912), including $6,897,784 of unrealized appreciation, were combined
with those of the Acquiring Portfolio. The aggregate net assets of the Acquiring
Portfolio and Series Fund immediately before the acquisition were $10,298 and
$54,597,912, respectively.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
AGGRESSIVE AGGRESSIVE MID CAP AGGRESSIVE
SMALL CAP EQUITY GROWTH GROWTH MICRO CAP
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------ ------------ -----------
<S> <C> <C> <C> <C>
ASSETS
Securities at Cost.......................... $ 29,694,966 $ 72,801,107 $ 20,737,517 $ 4,930,034
----------------- ------------ ------------ -----------
----------------- ------------ ------------ -----------
Securities at Value (Note 1)................ $ 38,815,049 $ 78,855,404 $ 25,011,513 $ 6,329,910
Receivable for Securities Sold.............. 4,058,842 5,802,293 1,556,955 241,395
Receivable for Shares Sold.................. 505,587 777,976 1,124,922 3,336
Interest Receivable......................... 7,976 15,805 4,980 964
Dividends Receivable........................ 1,200 27,750 5,576 120
Other Receivables........................... -- 162 -- --
Unamortized Organizational Costs (Note 1)... -- 37,590 -- --
----------------- ------------ ------------ -----------
Total Assets.............................. 43,388,654 85,516,980 27,703,946 6,575,725
----------------- ------------ ------------ -----------
LIABILITIES
Investment Advisory Fee Payable
(Note 2).................................. 26,295 50,565 14,328 4,275
Administrative Fee Payable (Note 2)......... 7,826 15,049 4,264 1,272
Distribution Plan Fee Payable (Note 4)...... 7,826 15,049 4,264 1,272
Payable for Securities Purchased............ 2,382,143 6,228,895 2,272,645 114,750
Payable for Shares Redeemed................. 19,716 85,630 38,117 25,090
Other Payables and Accrued Expenses......... 4,697 9,047 2,558 769
Organizational Expense Payable to Adviser
(Note 1).................................. -- 37,590 -- --
----------------- ------------ ------------ -----------
Total Liabilities......................... 2,448,503 6,441,825 2,336,176 147,428
----------------- ------------ ------------ -----------
NET ASSETS.................................... $ 40,940,151 $ 79,075,155 $ 25,367,770 $ 6,428,297
----------------- ------------ ------------ -----------
----------------- ------------ ------------ -----------
SHARES OUTSTANDING............................ 2,309,377 4,408,106 1,254,783 301,896
----------------- ------------ ------------ -----------
----------------- ------------ ------------ -----------
NET ASSET VALUE PER SHARE..................... $17.73 $17.94 $20.22 $21.29
------ ------ ------ -----------
------ ------ ------ -----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
JUNE 30, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
SMALL CAP LARGE CAP LARGE CAP INTERNATIONAL
VALUE GROWTH VALUE EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ----------- -------------
<S> <C> <C> <C> <C>
ASSETS
Securities at Cost.............................. $ 1,162,228 $ 5,403,934 $ 989,211 $ 9,837,686
----------- ----------- ----------- -------------
----------- ----------- ----------- -------------
Securities at Value (Note 1).................... $ 1,236,844 $ 6,683,804 $ 1,107,745 $ 8,832,098
Receivable for Securities Sold.................. -- -- -- 595
Receivable for Shares Sold...................... -- 28,903 41,466 45
Interest Receivable............................. 289 595 308 2,025
Dividends Receivable............................ 888 942 1,817 18,311
Other Receivables............................... -- 27 -- 913
Unamortized Organizational Costs (Note 1)....... 64,260 64,260 64,260 64,260
----------- ----------- ----------- -------------
Total Assets.................................. 1,302,281 6,778,531 1,215,596 8,918,247
----------- ----------- ----------- -------------
LIABILITIES
Investment Advisory Fee Payable (Note 2)........ 771 4,478 647 7,102
Administrative Fee Payable (Note 2)............. 229 1,333 216 1,775
Distribution Plan Fee Payable (Note 4).......... 229 1,333 216 1,775
Payable for Securities Purchased................ 30,628 -- -- 165,598
Payable for Shares Redeemed..................... -- 32,059 -- --
Other Payables and Accrued Expenses............. 138 800 129 1,776
Organizational Expense Payable to Adviser (Note
1)............................................ 64,260 64,260 64,260 64,260
----------- ----------- ----------- -------------
Total Liabilities............................. 96,255 104,263 65,468 242,286
----------- ----------- ----------- -------------
NET ASSETS........................................ $ 1,206,026 $ 6,674,268 $ 1,150,128 $ 8,675,961
----------- ----------- ----------- -------------
----------- ----------- ----------- -------------
SHARES OUTSTANDING................................ 123,243 397,088 87,865 899,844
----------- ----------- ----------- -------------
----------- ----------- ----------- -------------
NET ASSET VALUE PER SHARE......................... $9.79 $16.81 $13.09 $9.64
----- ----------- ----------- -----
----- ----------- ----------- -----
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
AGGRESSIVE SMALL AGGRESSIVE MID CAP AGGRESSIVE
CAP EQUITY GROWTH GROWTH MICRO CAP
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------ ----------- -----------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest (Note 1)................................. $ 28,995 $ 95,730 $ 18,828 $ 14,564
Dividends (Note 1)................................ 16,330 103,211 30,709 4,659
----------------- ------------ ----------- -----------
Total Investment Income......................... 45,325 198,941 49,537 19,223
----------------- ------------ ----------- -----------
EXPENSES
Investment Advisory Fee (Note 2).................. 162,959 305,625 56,575 28,428
Administrative Fee (Note 2)....................... 48,500 90,960 16,838 8,461
Distribution Plan Fees (Note 4)................... 48,502 91,235 16,882 8,453
Transfer Agent and Custodian Fee (Note 3)......... 53,540 69,726 27,363 24,244
Shareholder Reports and Notices................... 19,881 17,190 3,070 3,449
Registration Fees................................. 13,968 6,489 7,365 12,167
Organizational Expense (Note 1)................... -- 12,600 -- --
Trustees' Fees and Expenses (Note 2).............. 1,406 1,406 1,406 1,406
Other Expenses.................................... 6,513 12,690 1,796 1,949
----------------- ------------ ----------- -----------
Total Expenses.................................. 355,269 607,921 131,295 88,557
Less Expenses Reimbursed by Investment
Adviser (Note 2).............................. (66,209) (65,525) (30,897) (38,139)
----------------- ------------ ----------- -----------
Net Expenses.................................. 289,060 542,396 100,398 50,418
----------------- ------------ ----------- -----------
NET INVESTMENT LOSS................................. (243,735) (343,455) (50,861) (31,195)
----------------- ------------ ----------- -----------
Net Realized Gain on Investment Transactions........ 3,608,911 18,685,797 2,335,440 591,694
Change in Net Unrealized Appreciation of
Investments....................................... 495,818 (4,357,699) 2,543,854 (568,772)
----------------- ------------ ----------- -----------
NET GAIN ON INVESTMENTS............................. 4,104,729 14,328,098 4,879,294 22,922
----------------- ------------ ----------- -----------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS........................................ $ 3,860,994 $ 13,984,643 $ 4,828,433 $ (8,273)
----------------- ------------ ----------- -----------
----------------- ------------ ----------- -----------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE SIX MONTHS ENDED JUNE 30, 1999
(UNAUDITED)
<TABLE>
<CAPTION>
SMALL CAP LARGE CAP LARGE CAP INTERNATIONAL
VALUE GROWTH VALUE EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------- ----------- ----------- -------------
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest (Note 1)........................................ $ 1,015 $ 5,302 $ 1,103 $ 20,105
Dividends (Note 1)....................................... 7,423 13,170 8,679 103,924
----------- ----------- ----------- -------------
Total Investment Income................................ 8,438 18,472 9,782 124,029
----------- ----------- ----------- -------------
EXPENSES
Investment Advisory Fee (Note 2)......................... 3,658 21,912 3,023 47,361
Administrative Fee (Note 2).............................. 1,089 6,521 1,008 11,840
Distribution Plan Fees (Note 4).......................... 1,089 6,571 1,010 11,868
Transfer Agent and Custodian Fee (Note 3)................ 18,410 20,866 18,376 50,696
Organizational Expense (Note 1).......................... 9,180 9,180 9,180 9,180
Registration Fees........................................ 6,695 6,695 6,695 6,948
Trustees' Fees and Expenses (Note 2)..................... 1,406 1,406 1,406 1,406
Shareholder Reports and Notices.......................... 467 1,153 396 636
Other Expenses........................................... 239 746 264 1,549
----------- ----------- ----------- -------------
Total Expenses......................................... 42,233 75,050 41,358 141,484
Less Expenses Reimbursed by Investment Adviser (Note
2)................................................... (35,744) (36,133) (35,712) (58,575)
----------- ----------- ----------- -------------
Net Expenses......................................... 6,489 38,917 5,646 82,909
----------- ----------- ----------- -------------
NET INVESTMENT INCOME (LOSS)............................... 1,949 (20,445) 4,136 41,120
----------- ----------- ----------- -------------
Net Realized Gain (Loss) on Investment Transactions........ (43,508) (2,703) 44,347 (20,812)
Net Realized Loss on Foreign Currency Transactions......... -- -- -- (316)
Change in Net Unrealized Appreciation/Depreciation of
Investments.............................................. 121,204 728,722 63,710 (803,332)
----------- ----------- ----------- -------------
NET GAIN (LOSS) ON INVESTMENTS............................. 77,696 726,019 108,057 (824,460)
----------- ----------- ----------- -------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS............................................... $ 79,645 $ 705,574 $ 112,193 $ (783,340)
----------- ----------- ----------- -------------
----------- ----------- ----------- -------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
AGGRESSIVE SMALL CAP EQUITY AGGRESSIVE GROWTH
PORTFOLIO PORTFOLIO
----------------------------- -----------------------------
FOR THE SIX FOR THE YEAR FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED MONTHS ENDED ENDED
JUNE 30, 1999 DECEMBER 31, JUNE 30, 1999 DECEMBER 31,
(UNAUDITED) 1998 (UNAUDITED) 1998
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES
Net Investment Loss................... $ (243,735) $ (432,412) $ (343,455) $ (807,971)
Net Realized Gain (Loss) on Investment
Transactions........................ 3,608,911 (338,976) 18,685,797 10,857,763
Change in Net Unrealized Appreciation
of Investments...................... 495,818 686,288 (4,357,699) 262,591
------------- ------------- ------------- -------------
Net Increase (Decrease) in Net
Assets Resulting from
Operations........................ 3,860,994 (85,100) 13,984,643 10,312,383
------------- ------------- ------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS
From Net Realized Gain................ (461,494) -- -- --
------------- ------------- ------------- -------------
FROM SHARE TRANSACTIONS
Net Proceeds from Sales of Shares..... 19,451,452 69,506,803 52,417,234 267,578,704
Reinvestment of Distributions......... 446,173 -- -- --
Cost of Shares Redeemed............... (29,616,356) (95,041,562) (68,730,828) (298,233,289)
------------- ------------- ------------- -------------
Net Decrease in Net Assets Resulting
from Share Transactions........... (9,718,731) (25,534,759) (16,313,594) (30,654,585)
------------- ------------- ------------- -------------
TOTAL DECREASE IN NET ASSETS........ (6,319,231) (25,619,859) (2,328,951) (20,342,202)
NET ASSETS -- Beginning of Period....... 47,259,382 72,879,241 81,404,106 101,746,308
------------- ------------- ------------- -------------
NET ASSETS -- End of Period............. $ 40,940,151 $ 47,259,382 $ 79,075,155 $ 81,404,106
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
SHARES
Sold.................................. 1,234,077 4,515,915 3,349,327 20,345,331
Issued in Reinvestment of
Distributions....................... 29,706 -- -- --
Redeemed.............................. (1,909,492) (6,115,945) (4,432,669) (22,510,476)
------------- ------------- ------------- -------------
Net Decrease in Shares.............. (645,709) (1,600,030) (1,083,342) (2,165,145)
------------- ------------- ------------- -------------
------------- ------------- ------------- -------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
MID CAP GROWTH AGGRESSIVE MICRO CAP
PORTFOLIO PORTFOLIO
----------------------------- ---------------------------------
FOR THE SIX FOR THE YEAR FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED MONTHS ENDED ENDED
JUNE 30, 1999 DECEMBER 31, JUNE 30, 1999 DECEMBER 31,
(UNAUDITED) 1998 (UNAUDITED) 1998
------------- ------------- -------------- ----------------
<S> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES
Net Investment Loss................... $ (50,861) $ (34,943) $ (31,195) $ (67,090)
Net Realized Gain (Loss) on Investment
Transactions........................ 2,335,440 600,569 591,694 (593,873)
Change in Net Unrealized Appreciation
of Investments...................... 2,543,854 485,817 (568,772) 938,282
------------- ------------- -------------- ----------------
Net Increase (Decrease) in Net
Assets Resulting from
Operations........................ 4,828,433 1,051,443 (8,273) 277,319
------------- ------------- -------------- ----------------
DISTRIBUTIONS TO SHAREHOLDERS
From Net Realized Gain................ -- (174,079) -- --
------------- ------------- -------------- ----------------
FROM SHARE TRANSACTIONS
Net Proceeds from Sales of Shares..... 18,973,065 14,064,660 1,615,638 16,347,179
Reinvestment of Distributions......... -- 170,002 -- --
Cost of Shares Redeemed............... (6,557,394) (15,360,950) (4,830,514) (17,163,447)
------------- ------------- -------------- ----------------
Net Increase (Decrease) in Net
Assets Resulting from Share
Transactions...................... 12,415,671 (1,126,288) (3,214,876) (816,268)
------------- ------------- -------------- ----------------
TOTAL INCREASE IN NET ASSETS........ 17,244,104 (248,924) (3,223,149) (538,949)
NET ASSETS -- Beginning of Period....... 8,123,666 8,372,590 9,651,446 10,190,395
------------- ------------- -------------- ----------------
NET ASSETS -- End of Period............. $ 25,367,770 $ 8,123,666 $ 6,428,297 $9,651,446
------------- ------------- -------------- ----------------
------------- ------------- -------------- ----------------
SHARES
Sold.................................. 1,047,870 1,082,352 83,164 825,396
Issued in Reinvestment of
Distributions....................... -- 12,658 -- --
Redeemed.............................. (388,057) (1,173,434) (253,911) (852,387)
------------- ------------- -------------- ----------------
Net Increase (Decrease) in Shares... 659,813 (78,424) (170,747) (26,991)
------------- ------------- -------------- ----------------
------------- ------------- -------------- ----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
SMALL CAP LARGE CAP
VALUE PORTFOLIO GROWTH PORTFOLIO
----------------------------- ---------------------------------
FOR THE SIX FOR THE YEAR FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED MONTHS ENDED ENDED
JUNE 30, 1999 DECEMBER 31, JUNE 30, 1999 DECEMBER 31,
(UNAUDITED) 1998 (UNAUDITED) 1998
------------- ------------- -------------- ----------------
<S> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES
Net Investment Income (Loss).......... $ 1,949 $ 6,650 $ (20,445) $ (3,965)
Net Realized Loss on Investment
Transactions........................ (43,508) (49,214) (2,703) (51,859)
Change in Net Unrealized Appreciation/
Depreciation of Investments......... 121,204 (47,797) 728,722 548,665
------------- ------------- -------------- ----------------
Net Increase (Decrease) in Net
Assets Resulting from
Operations........................ 79,645 (90,361) 705,574 492,841
------------- ------------- -------------- ----------------
DISTRIBUTIONS TO SHAREHOLDERS
From Net Investment Income............ -- (6,650) -- --
------------- ------------- -------------- ----------------
FROM SHARE TRANSACTIONS
Net Proceeds from Sales of Shares..... 465,242 1,107,661 6,600,407 2,553,343
Reinvestment of Distributions......... -- 6,650 -- --
Cost of Shares Redeemed............... (195,957) (261,412) (3,033,260) (747,178)
------------- ------------- -------------- ----------------
Net Increase in Net Assets Resulting
from Share Transactions........... 269,285 852,899 3,567,147 1,806,165
------------- ------------- -------------- ----------------
TOTAL INCREASE IN NET ASSETS........ 348,930 755,888 4,272,721 2,299,006
NET ASSETS -- Beginning of Period....... 857,096 101,208 2,401,547 102,541
------------- ------------- -------------- ----------------
NET ASSETS -- End of Period............. $ 1,206,026 $ 857,096 $ 6,674,268 $2,401,547
------------- ------------- -------------- ----------------
------------- ------------- -------------- ----------------
SHARES
Sold.................................. 52,435 109,516 420,796 216,274
Issued in Reinvestment of
Distributions....................... -- 722 -- --
Redeemed.............................. (22,261) (27,174) (189,698) (60,290)
------------- ------------- -------------- ----------------
Net Increase in Shares.............. 30,174 83,064 231,098 155,984
------------- ------------- -------------- ----------------
------------- ------------- -------------- ----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
LARGE CAP INTERNATIONAL
VALUE PORTFOLIO EQUITY PORTFOLIO
----------------------------- ---------------------------------
FOR THE SIX FOR THE YEAR FOR THE SIX FOR THE YEAR
MONTHS ENDED ENDED MONTHS ENDED ENDED
JUNE 30, 1999 DECEMBER 31, JUNE 30, 1999 DECEMBER 31,
(UNAUDITED) 1998 (UNAUDITED) 1998
------------- ------------- -------------- ----------------
<S> <C> <C> <C> <C>
FROM INVESTMENT ACTIVITIES
Net Investment Income (Loss).......... $ 4,136 $ 8,851 $ 41,120 $ (9,344)
Net Realized Gain (Loss) on Investment
Transactions........................ 44,347 18,166 (20,812) 232,783
Net Realized Gain (Loss) on Foreign
Currency Transactions............... -- -- (316) 282
Change in Net Unrealized Appreciation/
Depreciation of Investments......... 63,710 53,686 (803,332) (202,622)
------------- ------------- -------------- ----------------
Net Increase (Decrease) in Net
Assets Resulting from
Operations........................ 112,193 80,703 (783,340) 21,099
------------- ------------- -------------- ----------------
DISTRIBUTIONS TO SHAREHOLDERS
From Net Investment Income............ -- (8,851) -- --
From Net Realized Gain................ -- (33,820) -- (226,731)
------------- ------------- -------------- ----------------
Total Distributions to
Shareholders...................... -- (42,671) -- (226,731)
------------- ------------- -------------- ----------------
FROM SHARE TRANSACTIONS
Net Proceeds from Sales of Shares..... 523,658 844,096 1,266,364 11,259,013
Reinvestment of Distributions......... -- 42,522 -- 226,731
Cost of Shares Redeemed............... (141,162) (370,425) (2,133,509) (963,665)
------------- ------------- -------------- ----------------
Net Increase (Decrease) in Net
Assets Resulting from Share
Transactions...................... 382,496 516,193 (867,145) 10,522,079
------------- ------------- -------------- ----------------
TOTAL INCREASE (DECREASE) IN NET
ASSETS............................ 494,689 554,225 (1,650,485) 10,316,447
NET ASSETS -- Beginning of Period....... 655,439 101,214 10,326,446 9,999
------------- ------------- -------------- ----------------
NET ASSETS -- End of Period............. $ 1,150,128 $ 655,439 $ 8,675,961 $10,326,446
------------- ------------- -------------- ----------------
------------- ------------- -------------- ----------------
SHARES
Sold.................................. 42,463 75,563 124,647 1,063,405
Issued in Reinvestment of
Distributions....................... -- 3,723 -- 21,738
Redeemed.............................. (12,151) (31,741) (214,886) (96,060)
------------- ------------- -------------- ----------------
Net Increase (Decrease) in Shares... 30,312 47,545 (90,239) 989,083
------------- ------------- -------------- ----------------
------------- ------------- -------------- ----------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
AGGRESSIVE SMALL CAP EQUITY
PORTFOLIO**
--------------------------------------------------------------------------------------
FOR THE SIX
MONTHS ENDED FOR THE YEARS ENDED DECEMBER 31,
JUNE 30, 1999 -------------------------------------------------------------------
(UNAUDITED) 1998 1997 1996 1995
---------------- ---------------- ---------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $15.99 $16.00 $17.79 $15.41 $10.98
------- ------- ------- ------------- -------------
Income from Investment Operations:
Net Investment Loss................. (0.11) (0.15) (0.30) (0.23) (0.16)
Net Realized and Unrealized Gain on
Investments....................... 2.05 0.14 2.30(C) 2.61 4.97
------- ------- ------- ------------- -------------
Total from Investment
Operations...................... 1.94 (0.01) 2.00 2.38 4.81
------- ------- ------- ------------- -------------
Distributions to Shareholders:
From Net Realized Gain.............. (0.20) -- (3.79) -- (0.38)
------- ------- ------- ------------- -------------
Net Increase (Decrease) in Net Asset
Value............................... 1.74 (0.01) (1.79) 2.38 4.43
------- ------- ------- ------------- -------------
Net Asset Value -- End of Period...... $17.73 $15.99 $16.00 $17.79 $15.41
------- ------- ------- ------------- -------------
------- ------- ------- ------------- -------------
TOTAL INVESTMENT RETURN................. 12.31%(A) (0.06)% 11.24% 15.44% 43.80%
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.49%(B) 1.63% 2.33% 1.75% 1.75%
Expenses Before Reimbursement (Note
2).................................. 1.83%(B) 1.98% 2.62% 1.86% 2.10%
Net Investment Loss After
Reimbursement (Note 2).............. (1.26)%(B) (0.79)% (1.37)% (1.33)% (1.15)%
Net Investment Loss Before
Reimbursement (Note 2).............. (1.60)%(B) (1.13)% (1.64)% (1.44)% (1.50)%
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 120% 145% 184% 137% 170%
Net Assets at End of Period (in
thousands).......................... $40,940 $47,259 $72,879 $190,035 $105,299
Number of Shares Outstanding at End of
Period (in thousands)............... 2,309 2,955 4,555 10,683 6,831
<CAPTION>
FOR THE
PERIOD
ENDED
DECEMBER 31,
1994*
-------------
<S> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $10.00
-------------
Income from Investment Operations:
Net Investment Loss................. (0.08)
Net Realized and Unrealized Gain on
Investments....................... 1.06
-------------
Total from Investment
Operations...................... 0.98
-------------
Distributions to Shareholders:
From Net Realized Gain.............. --
-------------
Net Increase (Decrease) in Net Asset
Value............................... 0.98
-------------
Net Asset Value -- End of Period...... $10.98
-------------
-------------
TOTAL INVESTMENT RETURN................. 9.80%(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.68%(B)
Expenses Before Reimbursement (Note
2).................................. 4.52%(B)
Net Investment Loss After
Reimbursement (Note 2).............. (0.81)%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (3.65)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 140%
Net Assets at End of Period (in
thousands).......................... $18,224
Number of Shares Outstanding at End of
Period (in thousands)............... 1,660
</TABLE>
- -----------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
(C) The per share amount does not coincide with the net realized and unrealized
loss for the year because of the timing of sales and redemptions of Fund
shares and the amount of per share realized and unrealized gain and loss at
such time.
* FROM COMMENCEMENT OF OPERATIONS JANUARY 3, 1994
** Financial Highlights include the performance of the Navellier Aggressive
Small Cap Equity Portfolio, a series of the Navellier Series Fund, which
reorganized on July 24, 1998, as a series of the Navellier Performance Funds.
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
AGGRESSIVE GROWTH
PORTFOLIO
--------------------------------------------------------------------------------
FOR THE
FOR THE SIX FOR THE YEARS ENDED PERIOD
MONTHS ENDED DECEMBER 31, ENDED
JUNE 30, 1999 ------------------------------------------------ DECEMBER 31,
(UNAUDITED) 1998 1997 1996 1995*
------------- ---------------- ------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $14.82 $13.29 $12.25 $9.99 $10.00
------------- ------- ------------- ------------- ------
Income from Investment Operations:
Net Investment Loss................. (0.08) (0.15) (0.14) (0.12) --
Net Realized and Unrealized Gain
(Loss) on Investments............. 3.20 1.68 1.34 2.38(C) (0.01)
------------- ------- ------------- ------------- ------
Total from Investment
Operations...................... 3.12 1.53 1.20 2.26 (0.01)
------------- ------- ------------- ------------- ------
Distributions to Shareholders:
From Net Realized Gain.............. -- -- (0.16) -- --
------------- ------- ------------- ------------- ------
Net Increase (Decrease) in Net Asset
Value............................... 3.12 1.53 1.04 2.26 (0.01)
------------- ------- ------------- ------------- ------
Net Asset Value -- End of Period...... $17.94 $14.82 $13.29 $12.25 $9.99
------------- ------- ------------- ------------- ------
------------- ------- ------------- ------------- ------
TOTAL INVESTMENT RETURN................. 21.05%(A) 11.51% 9.77% 22.62% (0.10)%(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.49%(B) 1.68% 2.00% 2.00% 2.00%(B)
Expenses Before Reimbursement (Note
2).................................. 1.67%(B) 1.89% 2.15% 2.22% 27.25%(B)
Net Investment Income (Loss) After
Reimbursement (Note 2).............. (0.94)%(B) (0.92)% (1.07)% (1.57)% 2.59%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (1.12)%(B) (1.13)% (1.22)% (1.77)% (12.66)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 378% 237% 247% 169% --
Net Assets at End of Period (in
thousands).......................... $79,075 $81,404 $101,746 $95,246 $300
Number of Shares Outstanding at End of
Period (in thousands)............... 4,408 5,491 7,657 7,774 30
</TABLE>
- --------------------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
(C) The per share amount does not coincide with the net realized and unrealized
loss for the year because of the timing of sales and redemptions of Fund
shares and the amounts of per share realized and unrealized gain and loss at
such time.
* FROM COMMENCEMENT OF OPERATIONS DECEMBER 28, 1995
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
MID CAP GROWTH
PORTFOLIO
----------------------------------------------------------------
FOR THE YEARS ENDED FOR THE
FOR THE SIX PERIOD
MONTHS ENDED DECEMBER 31, ENDED
JUNE 30, 1999 -------------------------------- DECEMBER 31,
(UNAUDITED) 1998 1997 1996*
------------- -------- ------------- -------------
<S> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $13.65 $12.43 $10.27 $10.00
------------- ------ ------ -------------
Income from Investment Operations:
Net Investment Income (Loss)........ (0.04) (0.06) (0.06) 0.01
Net Realized and Unrealized Gain on
Investments....................... 6.61 1.59 2.75 0.27
------------- ------ ------ -------------
Total from Investment
Operations...................... 6.57 1.53 2.69 0.28
------------- ------ ------ -------------
Distributions to Shareholders:
From Net Investment Income.......... -- -- -- (0.01)
From Net Realized Gain.............. -- (0.31) (0.53) --
------------- ------ ------ -------------
Total Distributions to
Shareholders.................... -- (0.31) (0.53) (0.01)
------------- ------ ------ -------------
Net Increase in Net Asset Value....... 6.57 1.22 2.16 0.27
------------- ------ ------ -------------
Net Asset Value -- End of Period...... $20.22 $13.65 $12.43 $10.27
------------- ------ ------ -------------
------------- ------ ------ -------------
TOTAL INVESTMENT RETURN................. 48.13%(A) 12.31% 26.18% 2.75%(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.49%(B) 1.66% 2.00% 2.00%(B)
Expenses Before Reimbursement (Note
2).................................. 1.93%(B) 2.56% 3.27% 113.02%(B)
Net Investment Income (Loss) After
Reimbursement (Note 2).............. (0.75)%(B) (0.38)% (0.69)% 0.87%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (1.20)%(B) (1.27)% (1.96)% (110.15)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 107% 211% 163% --
Net Assets at End of Period (in
thousands).......................... $25,368 $8,124 $8,373 $1,642
Number of Shares Outstanding at End of
Period (in thousands)............... 1,255 595 673 160
</TABLE>
- -----------------------------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
* FROM COMMENCEMENT OF OPERATIONS NOVEMBER 26, 1996
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
AGGRESSIVE MICRO CAP
PORTFOLIO
---------------------------------------------------
FOR THE
FOR THE SIX FOR THE YEAR PERIOD
MONTHS ENDED ENDED ENDED
JUNE 30, 1999 DECEMBER 31, DECEMBER 31,
(UNAUDITED) 1998 1997*
---------------- ---------------- -------------
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $20.42 $20.40 $15.64
------ ------ -------------
Income from Investment Operations:
Net Investment Loss................. (0.12) (0.14) (0.05)
Net Realized and Unrealized Gain on
Investments....................... 0.99 0.16 5.17
------ ------ -------------
Total from Investment
Operations...................... 0.87 0.02 5.12
------ ------ -------------
Distributions to Shareholders:
From Net Realized Gain.............. -- -- (0.36)
------ ------ -------------
Net Increase in Net Asset Value....... 0.87 0.02 4.76
------ ------ -------------
Net Asset Value -- End of Period...... $21.29 $20.42 $20.40
------ ------ -------------
------ ------ -------------
TOTAL INVESTMENT RETURN................. 4.26%(A) 0.10% 32.76%(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.49%(B) 1.51% 1.55%(B)
Expenses Before Reimbursement (Note
2).................................. 2.62%(B) 2.50% 3.21%(B)
Net Investment Loss After
Reimbursement (Note 2).............. (0.92)%(B) (0.71)% (0.54)%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (2.05)%(B) (1.70)% (2.20)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 90% 196% 86%
Net Assets at End of Period (in
thousands).......................... $ 6,428 $ 9,651 $10,190
Number of Shares Outstanding at End of
Period (in thousands)............... 302 473 500
</TABLE>
- ------------------------------------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
* FROM COMMENCEMENT OF OPERATIONS MARCH 17, 1997
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
SMALL CAP VALUE LARGE CAP GROWTH
PORTFOLIO PORTFOLIO
------------------------------------------------------ -------------------------------
FOR THE SIX FOR THE FOR THE FOR THE SIX FOR THE
MONTHS ENDED YEAR ENDED PERIOD ENDED MONTHS ENDED YEAR ENDED
JUNE 30, 1999 DEC. 31, DEC. 31, JUNE 30, 1999 DEC. 31,
(UNAUDITED) 1998 1997* (UNAUDITED) 1998
---------------- ---------------- ---------------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $9.21 $10.12 $10.00 $14.47 $10.25
------ ------ ------ ------ ------
Income from Investment Operations:
Net Investment Income (Loss)........ 0.02 0.07 0.01 (0.05) (0.02)
Net Realized and Unrealized Gain
(Loss) on Investments............. 0.56 (0.91) 0.12 2.39 4.24
------ ------ ------ ------ ------
Total from Investment
Operations...................... 0.58 (0.84) 0.13 2.34 4.22
------ ------ ------ ------ ------
Distributions to Shareholders:
From Net Investment Income.......... -- (0.07) (0.01) -- --
------ ------ ------ ------ ------
Net Increase (Decrease) in Net Asset
Value............................... 0.58 (0.91) 0.12 2.34 4.22
------ ------ ------ ------ ------
Net Asset Value -- End of Period...... $9.79 $9.21 $10.12 $16.81 $14.47
------ ------ ------ ------ ------
------ ------ ------ ------ ------
TOTAL INVESTMENT RETURN................. 6.30%(A) (8.28)% 1.25%(A) 16.17%(A) 41.17%
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.49%(B) 1.53% 1.75%(B) 1.49%(B) 1.54%
Expenses Before Reimbursement (Note
2).................................. 9.67%(B) 13.01% 7.74%(B) 2.86%(B) 9.11%
Net Investment Income (Loss) After
Reimbursement (Note 2).............. 0.45%(B) 1.12% 1.94%(B) (0.78)%(B) (0.43)%
Net Investment Loss Before
Reimbursement (Note 2).............. (7.74)%(B) (10.36)% (4.03)%(B) (2.15)%(B) (8.00)%
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 44% 85% 2% 40% 80%
Net Assets at End of Period (in
thousands).......................... $1,206 $857 $101 $6,674 $2,402
Number of Shares Outstanding at End of
Period (in thousands)............... 123 93 10 397 166
<CAPTION>
FOR THE
PERIOD ENDED
DEC. 31,
1997*
---------------
<S> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $10.00
------
Income from Investment Operations:
Net Investment Income (Loss)........ 0.01
Net Realized and Unrealized Gain
(Loss) on Investments............. 0.25
------
Total from Investment
Operations...................... 0.26
------
Distributions to Shareholders:
From Net Investment Income.......... (0.01)
------
Net Increase (Decrease) in Net Asset
Value............................... 0.25
------
Net Asset Value -- End of Period...... $10.25
------
------
TOTAL INVESTMENT RETURN................. 2.56%(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.90%(B)
Expenses Before Reimbursement (Note
2).................................. 6.66%(B)
Net Investment Income (Loss) After
Reimbursement (Note 2).............. 2.40%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (2.36)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... --
Net Assets at End of Period (in
thousands).......................... $103
Number of Shares Outstanding at End of
Period (in thousands)............... 10
</TABLE>
- -------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
* FROM COMMENCEMENT OF OPERATION DECEMBER 19, 1997
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- ---------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
LARGE CAP VALUE INTERNATIONAL EQUITY
PORTFOLIO PORTFOLIO
------------------------------------------------------ -------------------------------
FOR THE SIX FOR THE FOR THE FOR THE SIX FOR THE
MONTHS ENDED YEAR ENDED PERIOD ENDED MONTHS ENDED YEAR ENDED
JUNE 30, 1999 DEC. 31, DEC. 31, JUNE 30, 1999 DEC. 31,
(UNAUDITED) 1998 1997* (UNAUDITED) 1998
---------------- ---------------- ---------------- ------------- ---------------
<S> <C> <C> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $11.39 $10.11 $10.00 $10.43 $10.00
------ ------ ------ ------ -------
Income from Investment Operations:
Net Investment Income (Loss)........ 0.05 0.16 0.01 0.05 (0.01)
Net Realized and Unrealized Gain
(Loss) on Investments............. 1.65 1.91 0.11 (0.84) 0.67
------ ------ ------ ------ -------
Total from Investment
Operations...................... 1.70 2.07 0.12 (0.79) 0.66
------ ------ ------ ------ -------
Distributions to Shareholders:
From Net Investment Income.......... -- (0.16) (0.01) -- --
From Net Realized Gain.............. -- (0.63) -- -- (0.23)
------ ------ ------ ------ -------
Total Distributions to
Shareholders...................... -- (0.79) (0.01) -- (0.23)
------ ------ ------ ------ -------
Net Increase (Decrease) in Net Asset
Value............................... 1.70 1.28 0.11 (0.79) 0.43
------ ------ ------ ------ -------
Net Asset Value -- End of Period...... $13.09 $11.39 $10.11 $9.64 $10.43
------ ------ ------ ------ -------
------ ------ ------ ------ -------
TOTAL INVESTMENT RETURN................. 14.93%(A) 20.48% 1.18%(A) (7.57)%(A) 6.64%
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.40%(B) 1.42% 1.50%(B) 1.75%(B) 1.75%
Expenses Before Reimbursement (Note
2).................................. 10.22%(B) 14.34% 5.03%(B) 2.99%(B) 3.29%
Net Investment Income (Loss) After
Reimbursement (Note 2).............. 1.02%(B) 1.69% 3.09%(B) 0.87%(B) (0.14)%
Net Investment Loss Before
Reimbursement (Note 2).............. (7.80)%(B) (11.22)% (0.45)%(B) (0.37)%(B) (1.68)%
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... 31% 256% -- 30% 41%
Net Assets at End of Period (in
thousands).......................... $1,150 $655 $101 $8,676 $10,326
Number of Shares Outstanding at End of
Period (in thousands)............... 88 58 10 900 990
<CAPTION>
FOR THE
PERIOD ENDED
DEC. 31,
1997**
---------------
<S> <C>
PER SHARE OPERATING PERFORMANCE:
Net Asset Value -- Beginning of
Period.............................. $10.00
-------
Income from Investment Operations:
Net Investment Income (Loss)........ --
Net Realized and Unrealized Gain
(Loss) on Investments............. --
-------
Total from Investment
Operations...................... --
-------
Distributions to Shareholders:
From Net Investment Income.......... --
From Net Realized Gain.............. --
-------
Total Distributions to
Shareholders...................... --
-------
Net Increase (Decrease) in Net Asset
Value............................... --
-------
Net Asset Value -- End of Period...... $10.00
-------
-------
TOTAL INVESTMENT RETURN................. --(A)
RATIOS TO AVERAGE NET ASSETS:
Expenses After Reimbursement (Note
2).................................. 1.75%(B)
Expenses Before Reimbursement (Note
2).................................. 5.48%(B)
Net Investment Income (Loss) After
Reimbursement (Note 2).............. (1.75)%(B)
Net Investment Loss Before
Reimbursement (Note 2).............. (5.48)%(B)
SUPPLEMENTARY DATA:
Portfolio Turnover Rate............... --
Net Assets at End of Period (in
thousands).......................... $10
Number of Shares Outstanding at End of
Period (in thousands)............... 1
</TABLE>
- ------------------------
(A) Total returns for periods of less than one year are not annualized.
(B) Annualized
* FROM COMMENCEMENT OF OPERATION DECEMBER 19, 1997
** FROM COMMENCEMENT OF OPERATION DECEMBER 26, 1997
SEE NOTES TO FINANCIAL STATEMENTS.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1999
(UNAUDITED)
1. Significant Accounting Policies
The Navellier Performance Funds (the "Fund") is registered with the
Securities and Exchange Commission under the Investment Company Act of 1940, as
amended, (the "Act") as an open-end investment company which offers its shares
in a series of no-load non-diversified and diversified portfolios. The Fund is
authorized to issue an unlimited number of shares of capital stock with no
stated par value. The Fund currently consists of eight separate portfolios each
with its own investment objectives and policies: the Aggressive Small Cap Equity
Portfolio, a diversified open-end management company portfolio, the Aggressive
Growth Portfolio, a non-diversified open-end management company portfolio, the
Mid Cap Growth Portfolio, a diversified open-end management company portfolio,
the Aggressive Micro Cap Portfolio (formerly the Aggressive Small Cap
Portfolio), a diversified open-end management company portfolio, the Small Cap
Value Portfolio, a diversified open-end management company portfolio, the Large
Cap Growth Portfolio, a non-diversified open-end management company portfolio,
the Large Cap Value Portfolio, a diversified open-end management company
portfolio, and the International Equity Portfolio, a diversified open-end
management company portfolio. The financial statements have been prepared in
conformity with generally accepted accounting principles which permit management
to make certain estimates and assumptions at the date of the financial
statements. The following is a summary of significant accounting policies which
the Fund follows:
(a) Listed securities are valued at the last sales price of the New York
Stock Exchange and other major exchanges. Over-the-Counter securities are
valued at the last sales price. If market quotations are not readily
available, the Board of Trustees will value the Fund's securities in good
faith. The Trustees will periodically review this method of valuation and
recommend changes which may be necessary to assure that the Fund's instruments
are valued at fair value.
(b) Security transactions are recorded on the trade date (the date the
order to buy or sell is executed). Interest income is accrued on a daily
basis. Dividend income is recorded on the ex-dividend date. Realized gain and
loss from securities transactions are computed on an identified cost basis.
(c) Dividends from net investment income are declared and paid annually.
Dividends are reinvested in additional shares unless shareholders request
payment in cash. Net capital gains, if any, are distributed annually.
(d) The Fund intends to comply with the provisions of the Internal Revenue
Code applicable to regulated investment companies and will distribute all net
investment income and capital gains to its shareholders. Therefore, no Federal
income tax provision is required.
(e) Organizational expenses of the Aggressive Growth Portfolio, the Small
Cap Value Portfolio, the Large Cap Growth Portfolio, the Large Cap Value
Portfolio, and the International Equity Portfolio totaling $126,000, $91,800,
$91,800, $91,800, and $91,800, respectively, are being deferred and amortized
over 60 months beginning with the public offering of shares in the portfolios.
Any redemption by an initial investor during the amortization period will be
reduced by a pro rata portion of any of the unamortized organization expenses.
Such proration is to be calculated by dividing the number of initial shares
redeemed by the number of initial shares outstanding at the date of
redemption. At June 30, 1999, the unamortized organization costs of the
Aggressive Growth Portfolio, the Small Cap Value Portfolio, the Large Cap
Growth Portfolio, the Large Cap Value Portfolio, and the International Equity
Portfolio were $37,590, $64,260, $64,260, $64,260 and $64,260, respectively.
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
2. Investment Advisory Fees and Other Transactions with Affiliates
Investment advisory services are provided by Navellier Management, Inc. (the
"Adviser"). Effective May 1, 1998, under an agreement with the Adviser, the Fund
pays a fee at the annual rate of 0.84% of the daily net assets of the Aggressive
Small Cap Equity Portfolio, the Aggressive Growth Portfolio, the Mid Cap Growth
Portfolio, the Aggressive Micro Cap Portfolio, the Small Cap Value Portfolio,
and the Large Cap Growth Portfolio, 0.75% of the daily net assets of the Large
Cap Value Portfolio, and 1.00% of the daily net assets of the International
Equity Portfolio. The Adviser receives an annual fee equal to 0.25% of the Funds
average daily net assets in connection with the rendering of services under the
administrative services agreement and is reimbursed by the Fund for operating
expenses incurred on behalf of the Fund. An officer and trustee of the Fund is
also an officer and director of the Adviser.
Under an agreement between the Fund and the Adviser related to payment of
operating expenses, the Adviser has reserved the right to seek reimbursement for
the past, present and future operating expenses of the Fund paid by the Adviser,
at any time upon notice to the Fund. At December 31, 1998, the Adviser
voluntarily agreed not to seek future reimbursement of all unreimbursed past
expense incurred on behalf of the Fund. During the six months ended June 30,
1999, the Adviser paid operating expenses of the Aggressive Small Cap Equity
Portfolio, the Aggressive Growth Portfolio, the Mid Cap Growth Portfolio, the
Aggressive Micro Cap Portfolio, the Small Cap Value Portfolio, Large Cap Growth
Portfolio, the Large Cap Value Portfolio and the International Equity Portfolio
totaling $95,308, $120,101, $41,000, $43,215, $36,397, $40,046, $36,317, and
$70,415, respectively. Under the operating expense agreement, the Adviser
requested, and the Aggressive Small Cap Equity Portfolio, the Aggressive Growth
Portfolio, the Mid Cap Growth Portfolio, the Aggressive Micro Cap Portfolio, the
Small Cap Value Portfolio, the Large Cap Growth Portfolio, the Large Cap Value
Portfolio and the International Equity Portfolio reimbursed, $29,099, $54,576,
$10,103, $5,076, $653, $3,913, $605, and $11,840 respectively, of such expenses.
Effective May 1, 1998, the Adviser agreed to limit the total normal expenses of
each Portfolio to 1.49% of average annual net assets, except for the Large Cap
Value Portfolio's expense limitation of 1.40% and the International Equity
Portfolio's expense limitation of 1.75%.
Navellier Securities Corp. (the "Distributor") acts as the Fund's
Distributor and is registered as a broker-dealer under the Securities and
Exchange Act of 1934. The Distributor, which is the principal underwriter of the
Fund's shares, renders its services to the Fund pursuant to a distribution
agreement. An officer and trustee of the Fund is also an officer and director of
the Distributor.
The Fund pays each of its Trustees not affiliated with the Adviser $7,500
annually. For the six months ended June 30, 1999, Trustees' fees and expenses
totaled $11,250.
3. Transfer Agent and Custodian
Rushmore Trust and Savings, FSB ("Rushmore Trust"), provides transfer
agency, dividend disbursing and other shareholder services to the Fund. In
addition, Rushmore Trust serves as custodian of the Fund's assets. Fees paid to
Rushmore Trust are based upon a fee schedule approved by the Board of Trustees.
4. Distribution Plan
The Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule 12b-1
under the Act, whereby it reimburses the Distributor or others in an amount not
to exceed 0.25% per annum of the average daily net assets of the Aggressive
Small Cap Equity Portfolio, the Aggressive Growth Portfolio, the Mid Cap Growth
Portfolio, the Aggressive Micro Cap Portfolio, the Small Cap Value Portfolio,
the Large Cap Growth Portfolio, the Large Cap Value Portfolio, and, the
International Equity Portfolio for expenses incurred in the promotion and
distribution of shares of the Fund. These expenses include, but are not limited
to, the printing of prospectuses, statements of additional information, and
reports used for sales purposes, expenses of preparation of sales literature and
related expenses (including
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
Distributor personnel), advertisements and other distribution-related expenses,
including a prorated portion of the Distributor's overhead expenses attributable
to the distribution of shares. Such payments are made monthly. The 12b-1 fee
includes, in addition to promotional activities, the amount the Fund may pay to
the Distributor or others as a service fee to reimburse such parties for
personal services provided to shareholders of the Fund and/or the maintenance of
shareholder accounts. Such Rule 12b-1 fees are made pursuant to the Plan and
distribution agreements entered into between such service providers and the
Distributor or the Fund directly.
5. Securities Transactions
For the six months ended June 30, 1999, purchases and sales (including
maturities) of securities (excluding short-term securities) were as follows:
<TABLE>
<CAPTION>
AGGRESSIVE AGGRESSIVE MID CAP AGGRESSIVE
SMALL CAP EQUITY GROWTH GROWTH MICRO CAP
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- --------------- ------------- -------------
<S> <C> <C> <C> <C>
Purchases................................ $ 44,518,605 $ 263,600,042 $ 24,744,319 $ 6,101,444
----------------- --------------- ------------- -------------
----------------- --------------- ------------- -------------
Sales.................................... $ 55,122,837 $ 283,184,006 $ 14,046,569 $ 9,274,128
----------------- --------------- ------------- -------------
----------------- --------------- ------------- -------------
<CAPTION>
LARGE CAP LARGE CAP INTERNATIONAL
SMALL CAP VALUE GROWTH VALUE EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- --------------- ------------- -------------
<S> <C> <C> <C> <C>
Purchases................................ $ 611,636 $ 5,536,044 $ 462,074 $ 2,529,614
----------------- --------------- ------------- -------------
----------------- --------------- ------------- -------------
Sales.................................... $ 373,765 $ 1,960,106 $ 238,123 $ 3,209,933
----------------- --------------- ------------- -------------
----------------- --------------- ------------- -------------
</TABLE>
6. Unrealized Appreciation and Depreciation of Investments
Unrealized appreciation and depreciation as of June 30, 1999, based on the
cost for Federal income tax purposes is as follows:
<TABLE>
<CAPTION>
AGGRESSIVE AGGRESSIVE MID CAP AGGRESSIVE
SMALL CAP EQUITY GROWTH GROWTH MICRO CAP
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Gross Unrealized Appreciation............. $ 9,877,259 $ 7,878,680 $ 4,549,217 $ 1,669,048
Gross Unrealized Depreciation............. (757,176) (2,347,360) (337,194) (269,172)
----------------- ------------- ------------- -------------
Net Unrealized Appreciation............... $ 9,120,083 $ 5,531,320 $ 4,212,023 $ 1,399,876
----------------- ------------- ------------- -------------
----------------- ------------- ------------- -------------
Cost of Investments for Federal Income Tax
Purposes................................. $ 29,694,966 $ 73,324,084 $ 20,799,490 $ 4,930,034
----------------- ------------- ------------- -------------
----------------- ------------- ------------- -------------
</TABLE>
<TABLE>
<CAPTION>
LARGE CAP LARGE CAP INTERNATIONAL
SMALL CAP VALUE GROWTH VALUE EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Gross Unrealized Appreciation............. $ 136,572 $ 1,371,504 $ 140,157 $ 201,219
Gross Unrealized Depreciation............. (62,631) (95,718) (22,759) (1,207,172)
----------------- ------------- ------------- -------------
Net Unrealized Appreciation
(Depreciation)........................... $ 73,941 $ 1,275,786 $ 117,398 $ (1,005,953)
----------------- ------------- ------------- -------------
----------------- ------------- ------------- -------------
Cost of Investments for Federal Income Tax
Purposes................................. $ 1,162,903 $ 5,408,018 $ 990,347 $ 9,837,686
----------------- ------------- ------------- -------------
----------------- ------------- ------------- -------------
</TABLE>
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
- -----------------------------------------------------------------
7. Net Assets
At June 30, 1999, net assets consisted of the following:
<TABLE>
<CAPTION>
AGGRESSIVE AGGRESSIVE MID CAP AGGRESSIVE
SMALL CAP EQUITY GROWTH GROWTH MICRO CAP
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Paid-in-Capital............................ $ 32,572,728 $ 45,894,434 $ 18,447,890 $ 4,865,239
Undistributed Net Investment Loss.......... (243,735) (343,455) (50,861) (43,181)
Accumulated Net Realized Gain (Loss) on
Investment Transactions................... (508,925) 27,469,879 2,696,745 206,363
Net Unrealized Appreciation of
Investments............................... 9,120,083 6,054,297 4,273,996 1,399,876
----------------- ------------- ------------- -------------
NET ASSETS................................. $ 40,940,151 $ 79,075,155 $ 25,367,770 $ 6,428,297
----------------- ------------- ------------- -------------
----------------- ------------- ------------- -------------
</TABLE>
<TABLE>
<CAPTION>
LARGE CAP LARGE CAP INTERNATIONAL
SMALL CAP VALUE GROWTH VALUE EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
----------------- ------------ ------------ -------------
<S> <C> <C> <C> <C>
Paid-in-Capital.............................. $ 1,222,232 $ 5,469,405 $ 998,765 $ 9,664,932
Undistributed Net Investment Income (Loss)... 1,949 (20,445) 4,136 41,120
Accumulated Net Realized Gain (Loss) on
Investment and Foreign Currency
Transactions................................ (92,771) (54,562) 28,693 (24,138)
Net Unrealized Appreciation (Depreciation) of
Investments and Foreign Currency
Transactions................................ 74,616 1,279,870 118,534 (1,005,953)
----------------- ------------ ------------ -------------
NET ASSETS................................... $ 1,206,026 $ 6,674,268 $ 1,150,128 $ 8,675,961
----------------- ------------ ------------ -------------
----------------- ------------ ------------ -------------
</TABLE>
8. Federal Income Tax
At December 31, 1998, for Federal income tax purposes, the following Funds
had capital loss carryovers which may be applied against future net taxable
realized gains of each succeeding year until the earlier of its utilization or
its expiration:
<TABLE>
<CAPTION>
AGGRESSIVE SMALL LARGE CAP AGGRESSIVE
CAP EQUITY SMALL CAP VALUE GROWTH MICRO CAP
EXPIRES DECEMBER 31, PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
- ------------------------------------------ ----------------- ----------------- ----------- -------------
<S> <C> <C> <C> <C>
2005...................................... -- $ 50 -- --
2006...................................... $ 3,656,342 32,827 $ 39,186 $ 422,402
----------------- ------- ----------- -------------
$ 3,656,342 $ 32,877 $ 39,186 $ 422,402
----------------- ------- ----------- -------------
----------------- ------- ----------- -------------
</TABLE>
<PAGE>
PART C
OTHER INFORMATION
ITEM 23. EXHIBITS
<TABLE>
<S> <C>
(a)(1) Certificate of Trust of Registrant [initial N-1A filed
December 20, 1995] *
(a)(2) Declaration of Trust of Registrant [initial N-1A
filed December 20, 1995] *
(b) By-Laws of Registrant [initial N-1A filed
December 20, 1995] *
(c) Not Applicable
(d)(1) Investment Management Agreement between the Navellier
Aggressive Growth Portfolio and Navellier Management,
Inc., dated April 27, 1998 [filed May 26, 1998]*
(d)(2) Investment Management Agreement between the
Navellier Mid Cap Growth Portfolio and Navellier
Management, Inc., dated April 27, 1998 [filed May 26,
1998]*
(d)(3) Investment Management Agreement between the
Navellier Aggressive Micro Cap Portfolio and Navellier
Management, Inc., dated April 27, 1998 [filed May 26,
1998]*
(d)(4) Investment Management Agreement between the Navellier
Small Cap Value Portfolio and Navellier Management,
Inc. dated April 27, 1998 [filed May 26, 1998]*
(d)(5) Investment Management Agreement between the Navellier
Large Cap Growth Portfolio and Navellier Management,
Inc. dated April 27, 1998 [filed May 26, 1998]*
</TABLE>
<PAGE>
<TABLE>
<S> <C>
(d)(6) Investment Management Agreement between the Navellier
Large Cap Value Portfolio and Navellier Management,
Inc. dated April 27, 1998 [filed May 26, 1998]*
(d)(7) Investment Management Agreement between the Navellier
International Equity Portfolio and Navellier
Management, Inc. dated April 27, 1998 [filed May 26,
1998]*
(d)(8) (Exhibit A) Sub-advisory Agreement between Navellier Management,
Inc. and Global Value Investors, Inc. [Post-Effective
Amendment No. 8 filed December 9, 1997] *
(d)(9) Investment Management Agreement between Navellier
Management, Inc. and The Navellier Aggressive Small
Cap Equity Portfolio dated dated April 27, 1998 [filed
May 26, 1998]*
(e)(1) Distribution Agreement dated October 17, 1995 [initial
N-1A filed December 20, 1995] *
(e)(2) Selected Dealer Agreement (specimen) [initial N-1A
filed December 20, 1995] *
(f) Not Applicable
(g) Administrative Services, Custodian, Transfer Agreement
with Rushmore Trust & Savings, FSB [initial N-1A filed
December 20, 1995] *
(h)(1) Navellier Administrative Services Agreement [initial
N-1A filed December 20, 1995] *
(h)(2) Trustee Indemnification Agreements [initial N-1A filed
December 20,1995] *
(i) Consent of Counsel (filed herewith)
(j) Consent of Independent Auditors (filed herewith)
(k)(1) Financial Statement (The financial statement for the
year ended 12/31/98 is not contained in this N-1A
filing, but is incorporated by reference to the form
N-SAR filing dated 3/2/99. The financial statement
contained in the form N-SAR filing is identical to the
financial statement contained in this N-1A filing.)*
(k)(2) Financial Statement (The financial statement for the
period 1/1/99 through 6/30/99 is not contained in this
N-1A filing, but is incorporated by reference to the
form N-SAR filing dated 8/30/99. The financial statement
contained in the N-SAR filing is identical to the
financial statement contained in this N-1A filing.)*
(l)(1) Subscription Agreement between The Navellier
Performance Funds and Louis Navellier, dated October
17, 1995 [initial N-1A filed December 20, 1995] *
(l)(2) Investment Advisor Operating Expense Reimbursement
Agreement [initial N-1A filed December 20, 1995] *
(m)(1) 12b-1 Distribution Plan for the Navellier Aggressive
Growth Portfolio [initial N-1A filed
December 20, 1995] *
(m)(2) 12b-1 Distribution Plan for the Navellier Mid Cap
Growth Portfolio dated October 30, 1996 [Post-Effective
Amendment No. 4 filed November 26, 1996]*
(m)(3) 12b-1 Distribution Plan for the Navellier Small Cap
Value Portfolio [Post-Effective Amendment No. 7 filed
November 14, 1997]*
(m)(4) 12b-1 Distribution Plan for the Navellier Large Cap
Growth Portfolio [Post-Effective Amendment No. 7 filed
November 14, 1997]*
(m)(5) 12b-1 Distribution Plan for the Navellier Large Cap
Value Portfolio [Post-Effective Amendment No. 7 filed
November 14, 1997]*
</TABLE>
<PAGE>
<TABLE>
<S> <C>
(m)(6) 12b-1 Distribution Plan for the Navellier International
Equity Portfolio [Post-Effective Amendment No. 7 filed
November 14, 1997]*
(m)(7) 12b-1 Distribution Plan for the Navellier Aggressive
Small Cap Equity Portfolio dated March 30, 1998 filed
March 31, 1998 via EDGAR incorporated by reference *
(m)(8) 12b-1 Distribution Plan for the Navellier Aggressive
Micro Cap Portfolio dated April 27, 1998 [filed May 26,
1998]*
(n) Financial Data Schedule (The financial data schedules
are not contained in this N-1A filing, but are
incorporated by reference to the form N-SAR filing dated
2/27/99. The financial data schedules contained in the
form N-SAR filing are identical to the financial
statements contained in this N-1A filing.) *
(o) Rule 18f-3 Plan (filed herewith)
(p)(1) Code of Ethics for The Navellier Performance Funds
(filed herewith)
(p)(2) Code of Ethics for Navellier Management, Inc. (filed
herewith)
(p)(3) Code of Ethics for Navellier Securities Corp. (filed
herewith)
</TABLE>
* Denotes the document is incorporated herein by reference.
ITEM 24. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE FUND
(a) As is described in the Statement of Additional Information
("Control Persons and Principal Holders of Securities") the Fund was initially
but no longer is controlled by Louis Navellier, the sole stockholder, officer,
and director of the Investment Advisor, who also serves as Trustee and in
various officer positions with the Fund (as described more fully under "The
Investment Advisor, Distributor, Custodian and Transfer Agent" in the Statement
of Additional Information).
(b) The Distributor Navellier Securities Corp. (incorporated under
the laws of the State of Delaware) is wholly-owned by Louis G. Navellier, who is
also a stockholder, director, and officer of the Investment Advisor and a
Trustee and officer of the Fund.
ITEM 25. INDEMNIFICATION
The Fund shall indemnify each of its Trustees, officers, employees, and
agents (including persons who serve at its request as directors, officers, or
trustees of another organization in which it has any interest, as a shareholder,
creditor, or otherwise) against all liabilities and expenses (including amounts
paid in satisfaction of judgments, in compromise, as fines and penalties, and as
counsel fees) reasonably incurred by him in connection with the defense or
disposition of any action, suit, or other proceeding, whether civil or criminal,
in which he may be involved or with which he may be threatened, while in office
or thereafter, by reason of his being or having been such a Trustee, officer,
employee, or agent, except with respect to any matter as to which he shall have
been adjudicated to have acted in bad faith, willful misfeasance, gross
<PAGE>
negligence, or reckless disregard of his duties; provided, however, that as
to any matter disposed of by a compromise payment by such Person, pursuant to
a consent decree or otherwise, no indemnification either for said payment or
for any other expenses shall be provided unless there has been a
determination that such person did not engage in bad faith, willful
misfeasance, gross negligence, or reckless disregard of his duties involved
in the conduct of his office by the court or other body approving the
settlement or other disposition or by a reasonable determination, based upon
review of readily available facts (as opposed to a full trial-type inquiry),
that he did not engage in such conduct by written opinion from independent
legal counsel approved by a majority of a quorum of trustees who are neither
interested persons nor parties to the proceedings. The rights accruing to
any person under these provisions shall not exclude any other right to which
he may be lawfully entitled; provided that no person may satisfy any right of
indemnity or reimbursement granted herein or to which he may otherwise be
entitled except out of the Fund Property. A majority of a quorum of
disinterested non-party Trustees may make advance payments in connection with
indemnification under this section, provided that the indemnified person
shall have given a written undertaking adequately secured to reimburse the
Fund in the event it is subsequently determined that he is not entitled to
such indemnification, or a majority of a quorum of disinterested non-party
Trustees or independent counsel determine, after a review of readily
available facts, that the person seeking indemnification will probably be
found to be entitled to indemnification.
Insofar as indemnification for liability arising under the Securities Act
of 1933 may be permitted to the Trustees, officers, and controlling persons of
the Fund pursuant to the provisions described under this Item 27, or otherwise,
the Fund has been advised that, in the opinion of the SEC, such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Fund of expenses incurred or paid by
a Trustee, officer, or controlling person of the Fund in the successful defense
of any action, suit, or proceeding) is asserted by such Trustee, officer, or
controlling person in connection with the securities being registered, the Fund
will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question of whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
The Fund may purchase and maintain insurance on behalf of an officer,
Trustee, employee, or agent protecting such person, to the full extent permitted
by applicable law, from liability incurred by such person as officer, Trustee,
employee, or agent of the Fund or arising from his activities in such capacity.
Section 9 of the Distribution Agreement between the Fund and Navellier
Securities Corp., provides for indemnification of the parties thereto under
certain circumstances.
Section 4 of the Advisory Agreement between the various portfolios of the
Fund and the Investment Advisor provides for indemnification of the parties
thereto under certain circumstances.
C-5
<PAGE>
ITEM 26. BUSINESS AND OTHER CONNECTION OF THE INVESTMENT ADVISER
Set forth below is a description of any other business, profession,
vocation, or employment of a substantial nature in which each investment adviser
of the Fund and each director, officer, or partner of any such investment
adviser, is or has been at any time during the past two fiscal years, engaged
for his own account or in the capacity of director, officer, employee, partner,
or trustee:
<TABLE>
<CAPTION>
Name and Principal Positions Held with Registrant Principal Occupations During Past
Business Address and Its Affiliates Two Years
- ------------------ ------------------------------ ---------------------------------
<S> <C> <C>
Louis Navellier One East Trustee and President of The Navellier Mr. Navellier is and has been the CEO and President
Liberty Third Floor Performance Funds, one of Portfolio Managers of Navellier & Associates Inc., an investment
Reno, NV 89501 of the Aggressive Growth Portfolio, the management company since 1988; is and has been CEO
Mid Cap Growth Portfolio and the Aggressive and President of Navellier Management, Inc.; one of
Micro Cap Portfolio. Mr. Navellier the Portfolio Managers for the Investment Advisor
is also the CEO, President, Treasurer, and to this Fund and was one of Portfolio Managers to
Secretary of Navellier Management, Inc., a The Navellier Series Fund; President and CEO of
Delaware Corporation which is the Investment Navellier Securities Corp., the principal
Advisor to the Fund. Mr. Navellier is also Underwriter to this Fund and The Navellier Series
CEO, President, Secretary, and Treasurer of Fund; CEO and President of Navellier Fund
Navellier & Associates Inc., Navellier Management, Inc. and investment advisory company,
Publications, Inc., MPT Review Inc., and since November 30, 1995; and has been publisher and
Navellier International Management, Inc.; editor of MPT Review from August 1987 to the
Trustee and President of The American Tiger present, and was publisher and editor of the
Funds predecessor investment advisory newsletter OTC
Insight, which he began in 1980 and wrote through
July 1987.
</TABLE>
C-6
<PAGE>
ITEM 27. PRINCIPAL UNDERWRITERS
(a) The Distributor does not currently act as principal underwriter,
depositor, or investment adviser for any investment company other than the Fund
and The Navellier Series Fund.
(b) The following information is provided, as of the date hereof, with
respect to each director, officer, or partner of each principal underwriter
named in response to Item 21:
<TABLE>
<CAPTION>
Name and Principal Position and Offices Positions and Offices
Business Address with Underwriter with Registrant
- ------------------ -------------------- ---------------------
<S> <C> <C>
Louis Navellier CEO, President, Director, Trustee, President and
One East Liberty, Treasurer and Secretary CEO
Third Floor
Reno, NV 89501
</TABLE>
(c) As of the date hereof, no principal underwriter who is not an
affiliated person of the Fund has received any commissions or other compensation
during the Fund's last fiscal year.
ITEM 28. LOCATION OF ACCOUNTS AND RECORDS
All accounts, records, and other documents required to be maintained under
Section 31(a) of the 1940 Act and the rules promulgated thereunder are
maintained at the office of The Navellier Performance Funds located at One East
Liberty, Third Floor, Reno, Nevada 89501, and the offices of the Fund's
Custodian and Transfer agent at 4922 Fairmont Avenue, Bethesda, MD 20814.
ITEM 29. MANAGEMENT SERVICES
Other than as set forth in Part A and Part B of this Registration
Statement, the Fund is not a party to any management-related service contract.
ITEM 30. UNDERTAKINGS
The Fund hereby undertakes to furnish each person to whom a prospectus is
delivered a copy of the latest annual report to shareholders, upon request and
without change.
The Fund hereby undertakes that if it is requested by the holders of at
least 10% of its outstanding shares to call a meeting of shareholders for the
purpose of voting upon the question of removal of a Trustee, it will do so and
will assist in communications with other shareholders as required by Section
16(c) of the Investment Company Act of 1940.
C-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this
Post-Effective Amendment No. 14 to Registration Statement to be signed on its
behalf by the undersigned, thereto duly authorized, in the City of Reno, and
State of Nevada on the 27th day of December, 1999.
THE NAVELLIER PERFORMANCE FUNDS
By: /s/ Louis Navellier
---------------------
Louis Navellier
President and Trustee
The Navellier Performance Funds, and each person whose signature appears
below hereby constitutes and appoints Louis Navellier as such person's true and
lawful attorney-in-fact, with full power to sign for such person and in such
person's name, in the capacities indicated below, any and all amendments to this
Registration Statement, hereby ratifying and confirming such person's signature
as it may be signed by said attorney-in-fact to any and all amendments to said
Registration Statement.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons or their
attorneys-in-fact pursuant to authorization given on October 17, 1995, in the
capacities and on the date indicated:
/s/ Louis Navellier
- ------------------------ Trustee and President
Louis Navellier(1) (Principal Executive December 27, 1999
Officer), Treasurer
/s/ Joel Rossman
- ------------------------ Trustee
Joel Rossman December 27, 1999
/s/ Barry Sander
- ------------------------ Trustee
Barry Sander December 27, 1999
/s/ Arnold Langsen
- ------------------------ Trustee
Arnold Langsen(2) December 27, 1999
/s/ Jacques Delacroix
- ------------------------ Trustee and Secretary
Jacques Delacroix December 27, 1999
1 These persons are interested persons affiliated with the Investment
Advisor.
2 This person, although technically not an interested person affiliated with
the Investment Adviser, does provide consulting services to Navellier &
Associates Inc., a company owned by Louis Navellier.
C-8
<PAGE>
[LETTERHEAD]
December 24, 1998
The Navellier Performance Funds
One East Liberty, Third Floor
Reno, NV 89501
Re: The Navellier Performance Funds N-1A
Post-Effective Amendment No. 14
File No. 033-80195
File No. 811-09142
Gentlemen:
I have acted as counsel to The Navellier Performance Funds (the "Fund") in
connection with the preparation of the initial Registration Statement on Form
N-1A and all Post-Effective Amendments for filing with the Securities and
Exchange Commission, covering shares of common stock at no par value, of the
Fund.
I hereby consent to the incorporation by reference of my December 7, 1995
Opinion and Consent as an Exhibit to Post-Effective Amendment No. 14 to the
Registration Statement of the Fund and to the reference of my name in the
Prospectus included in the Registration Statement and to the filing of this
opinion as an exhibit to any application made by or on behalf of the Fund or any
Distributor or dealer in connection with the registration and qualification of
the Fund or its common stock under the securities laws of any state or
jurisdiction. In giving such permission, I do not admit hereby that I come
within the category of persons whose consent is required under Section 7 of the
Securities Act of 1933 or the rules and regulations of the Securities and
Exchange Commission thereunder.
Very truly yours,
LAW OFFICES OF SAMUEL KORNHAUSER
By: /s/ Samuel Kornhauser
--------------------------------
Samuel Kornhauser
<PAGE>
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the references to our firm in the Post-Effective
Amendment to the Registration Statement on Form N-1A of the Navellier
Performance Funds and to the use of our report dated February 19, 1999 on the
financial statements and financial highlights of Navellier Aggressive Small Cap
Equity Portfolio, Navellier Aggressive Growth Portfolio, Navellier Mid Cap
Growth Portfolio, Navellier Aggressive Micro Cap Portfolio, Navellier Small Cap
Value Portfolio, Navellier Large Cap Growth Portfolio, Navellier Large Cap Value
Portfolio, and Navellier International Equity Portfolio, each a series of shares
of the Navellier Performance Funds. Such financial statements, financial
highlights and report of independent certified public accountants appear in the
1998 Annual Report to Shareholders and are incorporated by reference in the
Registration Statement and Prospectus.
TAIT, WELLER & BAKER
Philadelphia, Pennsylvania
December 22, 1999
<PAGE>
THE NAVELLIER PERFORMANCE FUNDS
MID CAP GROWTH PORTFOLIO
(the Fund)
PLAN PURSUANT TO RULE 18F-3
The Fund hereby adopts this plan pursuant to Rule 18f-3 under the
Investment Company Act of 1940 (the 1940 Act), setting forth the separate
arrangement and expense allocation of each class of shares. Any material
amendment to this plan is subject to prior approval of the Board of Trustees,
including a majority of the independent Trustees.
CLASS CHARACTERISTICS
CLASS A SHARES: Class A shares are subject to a distribution or service fee
pursuant to Rule 12b-1 under the 1940 Act (Rule 12b-1 fee) of
0.25% per annum of the average daily net assets of the class.
CLASS I SHARES: Class I shares are not subject to any Rule 12b-1 fee.
INCOME AND EXPENSE ALLOCATIONS
Income, any realized and unrealized capital gains and losses, and expenses
not allocated to a particular class, will be allocated to each class on the
basis of the relative net assets (settled shares). "Relative net assets
(settled shares)" are net assets valued in accordance with generally accepted
accounting principles but excluding the value of subscriptions receivable in
relation to the net assets of the Fund.
DIVIDENDS AND DISTRIBUTIONS
Dividends and other distributions paid by the Fund to each class of shares,
to the extent paid, will be paid on the same day and at the same time, and
will be determined in the same manner and will be in the same amount, except
that the amount of the dividends and other distributions declared and paid by
a particular class may be different from that paid by another class because
of Rule 12b-1 fees and other expenses borne exclusively by that class.
EXCHANGE PRIVILEGE
Each class of shares is generally exchangeable for a class of shares with
similar characteristics, if any, of the other portfolios of the Navellier
Performance Funds (subject to certain minimum investment requirements) at
relative net asset value without the imposition of any sales charge.
GENERAL
A. Each class of shares shall have exclusive voting rights on any matter
submitted to shareholders that relates solely to its arrangement and
shall have separate voting rights on any matter submitted to
shareholders in which the interests of one class differ from the
interests of any other class.
B. On an ongoing basis, the Trustees, pursuant to their fiduciary
responsibilities under the 1940 Act and otherwise, will monitor the Fund
for the existence of any material conflicts among the interests of its
several classes. The Trustees, including a majority of the independent
Trustees, shall take such action as is reasonably necessary to eliminate
any such conflicts that may develop. Navellier Management, Inc., the
Fund's investment advisor, will be responsible for reporting any
potential or existing conflicts to the Trustees.
C. For purposes of expressing an opinion on the financial statements of the
Fund, the methodology and procedures for calculating the net asset value
and dividends/distributions of the Fund's several classes and the proper
allocation of income and expenses among such classes will be examined
annually by the Fund's independent auditors who, in performing such
examination, shall consider the factors set forth in the relevant
auditing standards adopted, from time to time, by the American Institute
of Certified Public Accountants.
Dated: December 24, 1999
<PAGE>
CODE OF ETHICS
FOR
THE NAVELLIER PERFORMANCE FUNDS
<PAGE>
SECTION 1 - DEFINITIONS
- -----------------------
1. DEFINITIONS
(a) "Fund" means The Navellier Performance Funds.
(b) "Access person" means any director, officer, general partner, or
advisory person of the Fund.
(c) "Advisory person" means (i) any employee of the Fund or of any
company in a control relationship to the Fund, who, in connection
with his or her regular functions or duties, makes, participates
in, or obtains information regarding the purchase or sale of a
security by the Fund, or whose functions relate to the making of
any recommendations with respect to such purchases or sales; and
(ii) any natural person in a control relationship to the Fund who
obtains information concerning recommendations made to the Fund
with regard to the purchase or sale of a security.
(d) A security is "being considered for purchase or sale" when a
recommendation to purchase or sell a security has been made and
communicated and, with respect to the person making the
recommendation, when such person seriously considers making such
a recommendation.
(e) "Beneficial ownership" shall be interpreted in the same manner as
it would be in determining whether a person is subject to the
provisions of Section 16 of the Securities Exchange Act of 1934
and the rules and regulations thereunder, except that the
determination of direct or indirect beneficial ownership shall
apply to all securities which an access person has or acquires.
(f) "Control" shall have the same meaning as that set forth in
Section 2(a)(9) of the Investment Company Act.
(g) "Disinterested director" means a director of the Fund who is not
an "interested person" of the Fund within the meaning of Section
2(a)(19) of the Investment Company Act.
(h) "Purchase or sale of a security" includes, INTER ALIA, the
writing of an option to purchase or sell a security.
1
<PAGE>
(i) "Security" shall have the meaning set forth in Section 2(a)(36)
of the Investment Company Act, except that it shall not include
shares of registered open-end investment companies, securities
issued by the Government of the United States, short term debt
securities which are "government securities" with the meaning of
Section 2(a)(16) of the Investment Company Act, bankers'
acceptances, bank certificates of deposit, commercial paper, and
such other money market instruments as designated by the board of
trustees.
(j) "Security held or to be acquired" by the Fund means any security
as defined in the Rule which, within the most recent 15 days, (i)
is or has been held by the Fund, or (ii) is being or has been
considered by the Fund for purchase by the Fund.
SECTION 2 - EXEMPTED TRANSACTIONS
- ---------------------------------
2. EXEMPTED TRANSACTIONS
The prohibitions of Section 3 of this Code shall not apply to:
(a) Purchases or sales effected in any account over which the access
person has no direct or indirect influence or control.
(b) Purchases or sales of securities which are not eligible for
purchase or sale by the Fund.
(c) Purchases or sales which are non-volitional on the part of either
the access person or the Fund.
(d) Purchases which are part of an automatic dividend reinvestment
plan.
(e) Purchases effected upon the exercise of rights issued by an
issuer PRO RATA to all holders of a class of its securities, to
the extent such rights were acquired from such issuer, and sales
of such rights so acquired.
(f) Purchases or sales which receive the prior written approval of
Louis Navellier which approval shall only be given if in
conformance with the criteria and anti-conflict of interest
provisions set forth herein and because they are only remotely
2
<PAGE>
potentially harmful to the Fund, because they would be very
unlikely to affect a highly institutional market, or because they
clearly are not related economically to the securities to be
purchased, sold or held by the Fund.
SECTION 3 - PROHIBITIONS
- ------------------------
3. PROHIBITED PURCHASES AND SALES
No access person shall purchase or sell, directly or indirectly, any
security in which he or she has, or by reason of such transaction acquires,
any direct or indirect beneficial ownership and which he or she knows or
should have known at the time of such purchase or sale:
(a) is being considered for puchase or sale by the Fund; or
(b) is being purchased or sold by the Fund.
SECTION 4 - REPORTING
- ---------------------
4. REPORTING
(a) Every access person shall report to the Fund the information
described in Section 4(c) of this Code with respect to
transactions in any security in which such access person has, or
by reason of such transaction acquires, any direct or indirect
beneficial ownership in the security; provided, however, that an
access person shall not be required to make a report with respect
to transaction effected for any account over which such person
does not have any direct or indirect influence.
(b) A disinterested director of the Fund need only report a
transaction in a security if such director, at the time of that
transaction, knew or, in the ordinary course of fulfilling his or
her official duties as a director of the Fund, should have known
that, during the 15-day period immediately preceding the date of
the transaction by the director, such security was purchased or
sold by the Fund or was being considered by the
3
<PAGE>
Fund or its investment adviser for purchase or sale by the Fund.
(c) Every report shall be made not later than 10 days after the end
of the calendar quarter in which the transaction to which the
report relates was effected, and shall contain the following
information:
(i) The date of the transaction, the title and the number of
shares, and the principal amount of each security
involved;
(ii) The nature of the transaction (i.e., purchase, sale or any
other type of acquisition or disposition);
(iii) The price at which the transaction was effected; and,
(iv) The name of the broker, dealer or bank with or through whom
the transaction was effected.
(d) Any such report may contain a statement that the report shall not
be construed as an admission by the person making such report
that he or she has any direct or indirect beneficial ownership in
the security to which the report relates.
SECTION 5 - SANCTIONS
- ---------------------
5. SANCTIONS
Upon discovering a violation of this Code, the board of directors of
the Fund may impose such sanctions as it deems appropriate, including,
INTER ALIA, a letter of censure or suspension or termination of the
employment of the violator.
4
<PAGE>
CODE OF ETHICS
FOR
NAVELLIER MANAGEMENT, INC.
<PAGE>
SECTION 1 - DEFINITIONS
1. DEFINITIONS
(a) "Adviser" means Navellier Management, Inc.
(b) "Investment Company" means The Navellier Series Fund, a
company registered as such under the Investment Company Act
of 1940 and for which the Adviser is the investment
adviser.
(c) "Access person" means any director, officer, general
partner, or advisory person of the Advisor.
(d) A security is "being considered for purchase or sale" when
a recommendation to purchase or sell a security has been
made and communicated and, with respect to the person
making the recommendation, when such person seriously
considers making such a recommendation.
(e) "Beneficial ownership" shall be interpreted in the same
manner as it would be in determining whether a person is
subject to the provisions of Section 16 of the Securities
Exchange Act of 1934 and the rules and regulations
thereunder, except that the determination of direct or
indirect beneficial ownership shall apply to all securities
which an access person has or acquires.
(f) "Control" shall have the same meaning as that set forth in
Section 2(a)(9) of the Investment Company Act.
(g) "Disinterested director" means a director of the Adviser
who is not an "interested person" of the Adviser within the
meaning of Section 2(a)(19) of the Investment Company Act.
(h) "Purchase or sale of a security" includes, INTER ALIA, the
writing of an option to purchase or sell a security.
(i) "Security" shall have the meaning set forth in Section
2(a)(36) of the Investment Company Act, except that it
shall not include shares of registered open-end investment
companies, securities issued by the Government of the
United States, short term debt securities which are
"government securities" with the meaning of Section
2(a)(16) of the Investment Company Act, bankers'
2
<PAGE>
acceptances, bank certificates of deposit, commercial
paper, and such other money market instruments as
designated by the board of directors.
(j) "Security held or to be acquired" by the Fund means any
security as defined in the Rule which, within the most
recent 15 days, (i) is or has been held by the Fund, or
(ii) is being or has been considered by the Fund for
purchase by the Fund.
SECTION 2 - EXEMPTED TRANSACTIONS
2. EXEMPTED TRANSACTIONS
The prohibitions of Section 3 of this Code shall not apply to:
(a) Purchases or sales effected in any account over which the
access person has no direct or indirect influence or
control.
(b) Purchases or sales of securities which are not eligible for
purchase or sale by the Fund.
(c) Purchases or sales which are non-volitional on the part of
either the access person or the Adviser.
(d) Purchases which are part of an automatic dividend
reinvestment plan.
(e) Purchases effected upon the exercise of rights issued by an
issuer PRO RATA to all holders of a class of its
securities, to the extent such rights were acquired from
such issuer, and sales of such rights so acquired.
(f) Purchases or sales which receive the prior written approval
of Louis Navellier which approval shall only be given if in
conformance with the criteria and anti-conflict of interest
provisions set forth herein and because they are only
remotely potentially harmful to the Fund, because they
would be very unlikely to affect a highly institutional
market, or because they clearly are not related
economically to the securities to be purchased, sold or
held by the Fund.
3
<PAGE>
SECTION 3 - PROHIBITIONS
3. PROHIBITED PURCHASES AND SALES
No access person shall purchase or sell, directly or indirectly,
any security in which he or she has, or by reason of such transaction
acquires, any direct or indirect beneficial ownership and which he or she
knows or should have known at the time of such purchase or sale:
(a) is being considered for purchase or sale by the Fund; or
(b) is being purchased or sold by the Fund.
SECTION 4 - REPORTING
4. REPORTING
(a) Every access person shall report to the Adviser the
information described in Section 4(c) of this Code with
respect to transactions in any security in which such
access person has, or by reason of such transaction
acquires, any direct or indirect beneficial ownership in
the security; provided, however, that an access person
shall not be required to make an a report with respect to
transaction effected for any account over which such person
does not have any direct or indirect influence.
(b) Notwithstanding Section 4(a) of this Code, an access person
need not make a report where the report would duplicate
information recorded pursuant to Rules 204-2(a)(12) or
204-2(a)(13) under the Investment Advisers Act of 1940.
(c) Every report shall be made not later than 10 days after the
end of the calendar quarter in which the transaction to
which the report relates was effected, and shall contain
the following information:
(i) The date of the transaction, the title and the
number of shares, and the principal amount of each
security involved;
(ii) the nature of the transaction (i.e, purchase, sale
or any other type of acquisition or
4
<PAGE>
disposition);
(iii) The price at which the transaction was effected;
and,
(iv) the name of the broker, dealer, or bank with or
through whom the transaction was effected.
(d) Any such report may contain a statement that the report
shall not be construed as an admission by the person making
such report that he or she has any direct or indirect
beneficial ownership in the security to which the report
relates.
SECTION 5 - SANCTIONS
5. SANCTIONS
Upon discovering a violation of this Code, the Adviser may impose
such sanctions as it deems appropriate, including, INTER ALIA, a letter
of censure or suspension or termination to the employment of the
violator. All material violations of the Code and any sanctions imposed
with respect thereto shall be reported periodically to the board of
directors of the investment company with respect to whose securities the
violation occurred.
5
<PAGE>
CODE OF ETHICS
FOR
NAVELLIER SECURITIES CORP.
<PAGE>
SECTION 1- DEFINITIONS
1. DEFINITIONS
(a) "Underwriter" means Navellier Securities Corp.
(b) "Investment Company" means a company registered as such under the
Investment Company Act of 1940 and for which the Underwriter is
the principal underwriter.
(c) "Advisory person" means (i) any employee of the Fund or of any
company in a control relationship to the Fund, who, in connection
with his or her regular functions or duties, makes, participates
in, or obtains information regarding the purchase or sale of a
security by the Fund, or whose functions relate to the making of
any recommendations with respect to such purchases or sales; and
(ii) any natural person in a control relationship to the Fund who
obtains information concerning recommendations made to the Fund
with regard to the purchase or sale of a security.
(d) A security is "being considered for purchase or sale" when a
recommendation to purchase or sell a security has been made and
communicated and, with respect to the person making the
recommendation, when such person seriously considers making such
a recommendation.
(e) "Beneficial ownership" shall be interpreted in the same manner as
it would be in determining whether a person is subject to the
provisions of Section 16 of the Securities Exchange Act of 1934
and the rules and regulations thereunder, except that the
determination of direct or indirect beneficial ownership shall
apply to all securities which an access person has or acquires.
(f) "Control" shall have the same meaning as that set forth in
Section 2(a) (9) of the Investment Company Act.
(g) "Disinterested director" means a director of the Fund who is not
an "interested person" of the Fund within the meaning of Section
2(a) (19) of the Investment Company Act.
(h) "Purchase or sale of a security" includes, INTER ALIA, the
writing of an option to purchase sell
2
<PAGE>
a security.
(i) "Security" shall have the meaning set forth in Section 2(a) (36)
of the Investment Company Act, except that it shall not include
shares of registered open-end investment companies, securities
issued by the Government of the United States, short term debt
securities which are "government securities" with the meaning of
Section 2(a) (16) of the Investment Company Act, bankers'
acceptances, bank certificates of deposit, commercial paper, and
such other money market instruments as designated by [the board
or some other entity or person].
(j) "Security held or to be acquired" by the Fund means any security
as defined in the Rule which, within the most recent 15 days,
(i) is or has been held by the Fund, or (ii) is being or has been
considered by the Fund for purchase by the Fund.
SECTION 2 - EXEMPTED TRANSACTIONS
2. EXEMPTED TRANSACTIONS
The prohibitions of Section 3 of this Code shall not apply to:
(a) Purchases or sales effected in any account over which the access
person has no direct or indirect influence or control.
(b) Purchases or sales of securities which are not eligible for
purchase or sale by the Fund.
(c) Purchases or sales which are non-volitional on the part of
either the access person or the Fund.
(d) Purchases which are part of an automatic dividend reinvestment
plan.
(e) Purchases effected upon the exercise of rights issued by an
issuer PRO RATA to all holders of a class of its securities, to
the extent such rights were acquired from such issuer, and sales
of such rights so acquired.
(f) Purchases or sales which receive the prior written
3
<PAGE>
approval of Louis Navellier which approval shall only be given
if in conformance with the criteria and anti-conflict of interest
provisions set forth herein and because they are only remotely
potentially harmful to the Fund, because they would be very
unlikely to affect a highly institutional market, or because they
clearly are not related economically to the securities to be
purchased, sold or held by the Fund.
SECTION 3 - PROHIBITIONS
3. PROHIBITED PURCHASES AND SALES
No access person shall purchase or sell, directly or indirectly, any
security in which he or she has, or by reason of such transaction acquires,
any direct or indirect beneficial ownership and which he or she knows or
should have known at the time of such purchase or sale:
(a) is being considered for purchase or sale by the Fund; or
(b) is being purchased or sold by the Fund.
SECTION 4 - REPORTING
4. REPORTING
(a) Every access person shall report to the Fund the information
described in Section 4(c) of this Code with respect to
transactions in any security in which such access person has, or
by reason of such transaction acquires, any direct or indirect
beneficial ownership in the security; provided, however, that an
access person shall not be required to make a report with respect
to transaction effected for any account over which such person
does not have any direct or indirect influence.
(b) "Advisory person" means (i) any employee of the Fund or of any
company in a control relationship to the Fund, who, in connection
with his or her regular functions or duties, makes, participates
in, or obtains information regarding the purchase or sale of a
security by the Fund, or whose functions relate to the making of
any recommendations with
4
<PAGE>
respect to such purchases or sales; and (ii) any natural person
in a control relationship to the Fund who obtains information
concerning recommendations with respect to such purchases or
sales; and (ii) any natural person in a control relationship to
the Fund who obtains information concerning recommendations made
to the Fund with regard to the purchase or sale of a security.
(c) A security is "being considered for purchase or sale" when a
recommendation to purchase or sell a security has been made and
communicated and, with respect to the person making such a
recommendation.
SECTION 5 - SANCTIONS
5. SANCTIONS
Upon discovering a violation of this Code, the Underwriter may impose
such sanctions as it deems appropriate, including INTER ALIA, a letter of
censure or suspension or termination of the employment of the violator.
All material violations of this Code and any sanctions imposed with respect
thereto shall periodically be reported to the board of directors of the
investment company with respect to whose securities the violation occurred.
5
