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This is notification of the regularly scheduled monthly tender offer. If you are
not interested in selling your shares at this time, kindly disregard this
notice.
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December 18, 1998
Dear North American Senior Floating Rate Fund, Inc. Shareholder:
This letter is to announce the monthly tender offer, also referred to as a
repurchase offer, for the North American Senior Floating Rate Fund, Inc. The
purpose of this tender offer is to provide easy access to your assets. The Fund
will repurchase shares only by tender offer and only during the Fund's regularly
scheduled monthly tender offers.
The monthly tender offer period will begin on December 18, 1998, and end on
December 31, 1998. If you wish to redeem shares, your tender offer must be
received by 4:00 p.m. on December 31, 1998. All tender offers received during
this period will be processed on December 31, 1998.
Please disregard this notice if you are not interested in selling shares at this
time. However, if you would like to sell shares for cash in this tender offer or
exchange to one of the other North American portfolios, complete the Repurchase
Offer Form included with this letter and return it to North American Funds, P.O.
Box 8505, Boston, MA 02266-8505.
ALL REQUESTS TO TENDER SHARES MUST BE RECEIVED IN GOOD ORDER BY THE
FUND BY 4:00P.M. DECEMBER 31, 1998.
If you have any questions, call your financial consultant, or call North
American Funds at 1-800-872-8037.
Sincerely,
North American Funds Shareholder Services
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NORTH AMERICAN SENIOR FLOATING RATE FUND, INC.
REPURCHASE OFFER DOCUMENT
1. THE OFFER. North American (the "Fund") is offering (the "Offer") to
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repurchase for cash up to ten (10%) of its issued and outstanding shares
("Shares") at a price equal to the net asset value per share ("NAV") as of
the close of business on the New York Stock Exchange on the Repurchase
Pricing Date (defined below) upon the terms and conditions set forth
herein. The purpose of the Offer is to provide liquidity to shareholders
because no secondary market exists for the Shares. The Offer is not
conditioned upon the tender for repurchase of any minimum number of Shares.
2. NET ASSET VALUE. The NAV of the Funds on December 16, 1998 was $9.98 per
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Share. The NAV can fluctuate. Please call North American at 1-800-872-8037
for current price information. The Fund's shares are not traded on any
organized market.
3. REPURCHASE REQUEST DEADLINE. All tenders of Shares for repurchase must be
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received in proper form by the Fund on or before 4:00 p.m. Eastern time, on
December 31, 1998.
4. REPURCHASE PRICING DATE. The NAV for the repurchase will be determined on
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December 31, 1998.
5. PAYMENT FOR SHARES REPURCHASED. The Fund expects to make payment for all
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shares repurchased the day following the Repurchase Pricing Date; in any
event, the Fund will pay repurchase proceeds within 5 business days or 7
calendar days (whichever is sooner) after the Repurchase Pricing Date. The
Fund will not charge a repurchase fee.
6. INCREASE IN NUMBER OF SHARES REPURCHASED: PRO RATA REPURCHASES. If
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shareholders tender for repurchase more than 10% of the Shares, the Fund
may (but is not obligated to) repurchase an additional two percent (2%) of
the shares. If the Fund determines not to repurchase the additional 2%, or
if shareholders tender an amount exceeding 12% of the Shares, the Fund will
repurchase shares tendered on a pro rata basis.
There can be no assurance that the Fund will be able to repurchase all
shares that you have tendered, even if you tender all shares held in your
account. In the event of an oversubscribed Offer, you may be unable to
liquidate some or all of your investment at net asset value. You may have
to wait until a later month to tender shares that the Fund is unable to
repurchase, and you would be subject to the risk of net asset value
fluctuations during this time period.
7. WITHDRAWAL OF SHARES TO BE REPURCHASED. Tenders of shares may be withdrawn
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or modified at any time prior to 4:00 p.m., Eastern Time, on December 31,
1998.
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8. SUSPENSION OR POSTPONEMENT OF REPURCHASE OFFER. The Fund may suspend or
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postpone a Repurchase Offer in limited circumstances, and only by vote of a
majority of the Board of Directors, including a majority of the independent
Directors. These circumstances are limited and include the following:
(a) if the Repurchase would cause the Fund to lose its status as a
regulated investment company under Subchapter M of the Internal
Revenue Code;
(b) for any period during which an emergency exists as a result of
which is not reasonably practicable for the Fund to dispose of
securities it owns or to determine the value of the Fund's net
assets;
(c) for any other periods that the Securities and Exchange Commission
permits by order for the protection of shareholders;
(d) if the shares are listed on a national securities exchange or
quoted in an inter-dealer quotation system of a national
securities association (e.g., NASDAQ) and the Repurchase would
cause the shares to lose that status; or
(e) during any period in which any market on which the shares are
principally traded is closed, or during any period in which
trading on the market is restricted.
You will be notified if the Fund suspends or postpones the Offer. If the Fund
renews the Offer after a suspension or postponement, you will be sent a new
notification.
TAX CONSEQUENCES. Shareholders should consult their tax advisors regarding the
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specific tax consequences, including state and local tax consequences, of
participating in the repurchase. A tender of shares pursuant to the repurchase
offer will be treated as a taxable sale of the Shares.
The Fund intends to take the position that tendering shareholders will qualify
for sale or exchange treatment. If the transaction is treated as a sale or
exchange for tax purposes, any gain or loss recognized would be treated as a
capital gain or loss by shareholders that hold their Shares as a capital asset.
* * * * *
Neither the Fund nor its Board of Directors makes any recommendation to any
shareholder as to whether to tender or refrain from tendering shares. Each
shareholder must make an independent decision whether to tender Shares and, if
so, how many Shares to tender.
No person has been authorized to make any recommendation on behalf of the Fund
as to whether shareholders should tender Shares pursuant to this Offer. No
person has been authorized to give any information or to make any
representations in connection with the Offer other than those contained herein
or in the Repurchase Procedures. If given or made, such recommendation and such
information and representation may not be relied upon as having been authorized
by the Fund.
For per share net asset value and other information, or for a copy of the Fund's
prospectus, contact your financial consultant or call North American Funds
at 1-800-872-8037.
Dated: December 18, 1998
<PAGE>
NORTH AMERICAN FLOATING RATE FUND, INC.
REPURCHASE OFFER FORM
Please accept this tender of the shares designated below for repurchase at a
price equal to their net asset value (NAV) per share on the repurchase pricing
date.
1. ACCOUNT
REGISTRATION:___________________________________________________________________
IF JOINT ACCOUNT, BOTH SHAREHOLDERS MUST SIGN. IF SHAREHOLDER IS A CORPORATION
OR TRUST, CAPACITY TO ACT MUST BE INCLUDED (I.E., RESOLUTION OF CERTIFICATION).
2. ACCOUNT NUMBER: 3. DAYTIME TELEPHONE NUMBER:
________________________ (_____)__________________
4. SHARES TENDERED: Please check applicable box(es)*
[_] Dollar Amount............ Please tender enough shares to net $____________
[_] Share Amount............. Please tender__________________shares from my
Account.
[_] Full Tender.............. Please tender all shares from my Account.
[_] IRA Distribution......... Please complete section below.
<TABLE>
<S> <C>
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Federal Income Tax Withholding I do not want federal income tax withheld from my distribution.
[_] Withhold ______% of my distribution for federal income tax.
Reason for IRA Distribution [_] Pre-Exempt [_] Premature [_] Over 591/2 years of age
[_] Disability [_] Minimum Distribution
[_] Return of Excess Contribution
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</TABLE>
5. PAYMENT AND DELIVERY INSTRUCTIONS: Please make check payable and mail to:
[_] Address of Record [_] *Other
_________________
* Your request to tender over $50,000.00 or to send checks to an address other
than that of record must be signature guaranteed by a member firm of a regional
national securities exchange or of an NASD member, a commercial bank or trust
company or other eligible guarantor institution as defined in Rule 17Ad-15(a)(2)
under the Securities and Exchange Act of 1934.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
6. EXCHANGE TO: $ AMOUNT $ AMOUNT
Int'l Small Cap 904 B 905 C __ Equity-Income 249 B 270 C
Int'l Growth & Income 786 B 787 C __ Balanced 251 B 372 C __
Global Equity 247 B 280 C __ Strategic Income 256 B 329 C __
Emerging Growth 323 B 324 C __ Invsmt Quality Bond 257 B 331 C __
Small/Mid Cap 901 B 902 C __ Nat'l Muni Bond 277 B 354 C __
Growth Equity 907 B 908 C __ US Gov't Securities 253 B 307 C __
Tax Sensitive 320 B 321 C __ Money Market 279 B 373 C __
Growth & Income 252 B 302 C __
</TABLE>
7. SIGNATURE(S) OF OWNERS EXACTLY AS REGISTERED:
____________________ ____________________ ____________________
Signature Signature Date
If you have any questions concerning this form, please call North American Funds
at 1-800-872-8037.
After completing this form, return to:
North American Funds
P.O. Box 8505
Boston, MA 02266-8505
