<PAGE>
FORUM ANNUAL REPORT
FUNDS MARCH 31, 2000
INVESTORS HIGH GRADE
BOND FUND
INVESTORS BOND FUND
TAXSAVER BOND FUND
MAINE MUNICIPAL
BOND FUND
NEW HAMPSHIRE
BOND FUND
INVESTORS GROWTH FUND
PAYSON BALANCED FUND
PAYSON VALUE FUND
<PAGE>
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TABLE OF CONTENTS
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A Message to Our Shareholders..................... 1
Discussion: Forum Investment Advisors, LLC........ 2
Discussion: H.M. Payson & Co...................... 3
Forum Funds Performance........................... 5
FINANCIAL STATEMENTS OF THE FORUM FUNDS
Schedules of Investments:
Investors High Grade Bond Fund.................. 8
Investors Bond Fund............................. 9
TaxSaver Bond Fund.............................. 10
Maine Municipal Bond Fund....................... 12
New Hampshire Bond Fund......................... 16
Investors Growth Fund........................... 19
Payson Balanced Fund............................ 20
Payson Value Fund............................... 22
Notes to Schedules of Investments................. 23
Statements of Assets and Liabilities.............. 24
Statements of Operations.......................... 26
Statements of Changes in Net Assets............... 28
Financial Highlights.............................. 32
Notes to Financial Statements..................... 36
Independent Auditors' Report...................... 41
FORUM FUNDS-Registered Trademark-
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FORUM FUNDS-Registered Trademark-
<PAGE>
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A MESSAGE TO OUR SHAREHOLDERS
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March 31, 2000
Dear Investor,
Forum Funds is pleased to send you this annual report for the period ended
March 31, 2000. We will share with you the financial highlights of the period
and our perspective on the financial markets. We would also like to take this
opportunity to thank shareholders for the continued confidence they have placed
in the Funds. Total net assets for the eight Forum Funds in this annual report
stand at over $210 million, and we want to ensure you that the advisers are
prudently managing your investment.
In the equity markets, the Funds' fiscal year has been marked by the
explosive growth of the NASDAQ, particularly since October, when the Index stood
at 2700. As of March 31, 2000, the index was at 4573 (having briefly topped 5000
early in March), an 86.2% total return for the year. When one compares this to
the otherwise reasonable returns of 17.9% and 13.3% for the S&P 500 Index and
the Dow Industrials, respectively, one can see the market mania for technology
and small-cap stocks. These returns were achieved despite continued monetary
policy tightening by the Federal Reserve (the "Fed"), which pushed the Fed Funds
rate up 100 basis points to 6% over the period. The markets' nerves are now
being tested by the difficult valuations of many of the NASDAQ stocks and the
potential for further Fed tightening.
In the fixed-income markets, bond prices fell through the end of 1999, as
investors worried about Fed policy and focused their attention on the soaring
equities market. Bond yields hit their peak in late January of this year, when
the long bond hit 6.74%. Since that time, additional Fed tightening and the
impact of investors seeking respite from the volatility of the equity markets
have added strength to the longer end of the bond market. The first calendar
quarter of 2000 ended with an inverted yield curve, with five-year notes
yielding 6.27% and the long bond at 5.84%. In the municipal bond market, prices
fell relatively more than those in the taxable fixed income securities markets
over the period.
The coming fiscal year has begun with increased volatility in the markets.
Interest rates continue to have an upward bias in this environment, which will
serve to limit total return in stocks and bonds. However, presuming that the Fed
has acted quickly enough to control inflation, the outlook can still be
characterized as constructive for financial assets. We counsel investors to stay
with their long-term investing plan.
Thank you again for your trust in Forum Funds. We invite you to read the
Adviser comments on market conditions on the following pages and to review the
remainder of this annual report for further details about the Funds. We will
strive to continue meeting your needs by providing outstanding investment
service. If you have questions, please discuss them with your local investment
professional or call us at 207-879-0001.
Sincerely,
/S/ JOHN Y. KEFFER
JOHN Y. KEFFER
President
FORUM FUNDS-Registered Trademark-
<PAGE>
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DISCUSSION: FORUM INVESTMENT ADVISORS, LLC
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ECONOMIC OVERVIEW
ECONOMIC AND FINANCIAL DEVELOPMENTS
The U.S. economy is now in its longest economic expansion, over eight years
and counting. GDP has advanced at a remarkably consistent 4.0% to 4.5% annual
rate for the last four years. However, since early 1999, the Federal Reserve has
been tightening monetary policy to ensure that the economy maintains growth at a
non-inflationary rate (though some accuse Mr. Greenspan of wanting to spoil the
equity party!). A number of factors attest to the strengthening economy. The
unemployment rate continues its descent, measuring 4.1% in March, down from its
peak in this cycle of almost 8% in mid-1992. Retail sales have soared, with
year-over-year increases of around 10% for each of the last nine months.
Manufacturing managers and consumers are both very positive about the near term
economic outlook, as measured by the Purchasing Managers Index and consumer
confidence surveys. Finally, prices, as measured by the CPI, have begun to
climb. The CPI was up 3.7% year-over-year in March 2000, from its trough of 1.5%
in the spring of 1998.
THE MARKETS AND FUND PERFORMANCE
Throughout the fiscal year, there was debate about whether the U.S. has
entered a "new economy". Certainly, the companies which represent that so-called
new economy, predominantly technology and biotechnology, were amply rewarded
during the most recent fiscal year, in some cases receiving valuations difficult
to justify, let alone quantify. By contrast, companies in old-economy sectors
received scant attention. It was in this context that the Forum Investors Growth
Fund struggled over the past year. The Payson Value Fund turned in a relatively
strong performance, in the struggling "value" sector of the market, through
astute stock selection and good market timing. The Payson Value Fund had a total
return of 17.20%, not including the impact of sales charges, versus the
Morningstar Growth & Income Funds average return of 13.32%.
In the fixed income markets, all three of the Forum municipal bond funds
outperformed their benchmarks, despite a difficult market environment. Good
asset selection and a steady, patient style characterized the management of
these funds. During the period, the Maine Municipal Bond Fund and the New
Hampshire Bond Fund had total returns of 0.43% and 0.03%, respectively, not
including the impact of sales charges, versus the Morningstar Municipal Bond
National Funds average return of -1.68%. TaxSaver Bond Fund had a total return
of -0.74%, not including the impact of sales charges, versus that same
benchmark.
CONCLUSION
The financial markets are likely to be somewhat cautious going forward,
particularly as monetary policy retains its tightening bias, and fiscal policy
was not made expansionary through tax cuts. Strong performance in the equity
markets continues to be concentrated in a few sectors, and the fixed income
market remains volatile. We should again emphasize that it is a good time for
investors to stick to their long term investing plan, rebalancing as necessary
in order to implement that plan.
2 FORUM FUNDS-Registered Trademark-
<PAGE>
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DISCUSSION: H. M. PAYSON & CO.
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Dear Payson Fund Shareholder: April 6, 2000
During the twelve months ended March 31, 2000, the financial markets were
characterized by a continuation of the divergence in valuations seen in 1998 and
1999. Investor enthusiasm over technology and Internet stocks carried valuations
in that sector to extremes, while the vast majority of stocks remained stagnant
or declined.
By March of 1999, the global financial crisis of the previous year seemed a
distant memory for investors. An accommodating Federal Reserve, a strong economy
and rising corporate profits served as a positive background for advances in the
major indices. Yet, the advances were dramatically uneven. For the period, the
Dow Jones Industrial Average gained 13.3%, and the Standard & Poor's 500 Index
17.9%, excluding dividends. But investor infatuation with the Internet was
clearly evident in the stunning 86.2% gain for the technology-laden NASDAQ
composite index. Masked by the positive performance of these indices was the
fact that a large number of stocks in non-technology sectors actually declined
during the period. By and large, investors shunned "old economy" issues in the
belief that no price was too high to pay for future profits. Traditional
valuation metrics such as Price/Earnings Ratios, Price to Cash Flow, Book Value,
etc., were simply discarded as participants rationalized the extreme valuations
awarded to anything Internet-related--despite the fact that many of these
companies had no revenues, let alone profits.
Recent market activity suggests that reality may be coming home to roost for
many Internet stocks, as companies exhaust cash reserves and venture capitalists
shy away. The Federal Reserve has demonstrated its intention to manage the
artificial "wealth effect" caused by soaring share prices, a troubling
development for high P/E issues. While the Internet is surely here to stay, we
believe that the best route to long-term investment returns is through diligent
attention to valuations. We, too, are enthusiastic about the promise of
technology investing, but will limit our commitments on behalf of Payson Fund
shareholders to real companies with real earnings, selling at valuations that
can be justified by reasonable expectations. Once again, we thank you for your
continued confidence.
H.M. Payson & Co.
Investment Adviser
3 FORUM FUNDS-Registered Trademark-
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4 FORUM FUNDS-Registered Trademark-
<PAGE>
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FORUM FUNDS PERFORMANCE
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SUMMARY PERFORMANCE INDICATORS
TWELVE MONTH TOTAL RETURN--PERIOD ENDING MARCH 31, 2000
<TABLE>
<CAPTION>
FORUM VS.
FORUM BENCHMARK BENCHMARK
----- --------- ---------
<S> <C> <C> <C>
Investors High Grade Bond Fund.............................. 1.35% 1.79%(1) -0.44%
Investors Bond Fund......................................... 1.13% 1.39%(2) -0.26%
TaxSaver Bond Fund.......................................... -0.74% -1.68%(3) 0.94%
Maine Municipal Bond Fund................................... 0.43% -1.68%(3) 2.11%
New Hampshire Bond Fund..................................... 0.03% -1.68%(3) 1.71%
Investors Growth Fund....................................... 6.54% 36.75%(4) -30.21%
Payson Balanced Fund........................................ 4.53% 10.25%(5) -5.72%
Payson Value Fund........................................... 17.20% 13.32%(6) 3.88%
(1) MORNINGSTAR Corporate Bond-High Quality Funds
Average: 282 Funds in Category
(2) MORNINGSTAR Corporate Bond-General Funds
Average: 582 Funds in Category
(3) MORNINGSTAR Municipal Bond-National Funds
Average: 550 Funds in Category
(4) MORNINGSTAR Growth Funds Average: 2,021 Funds
in Category
(5) MORNINGSTAR Balanced Funds Average: 445 Funds
in Category
(6) MORNINGSTAR Growth & Income Funds Average: 849
Funds in Category
</TABLE>
PAST PERFORMANCE IS NO GUARANTEE OF FUTURE RESULTS. FORUM FUNDS AND MORNINGSTAR
FIGURES DO NOT INCLUDE THE EFFECT OF MAXIMUM SALES CHARGE, SEE TABLE BELOW.
DURING THE PERIOD CERTAIN FEES AND EXPENSES WERE WAIVED BY THE SERVICE
PROVIDERS. IF THE MAXIMUM SALES CHARGE WAS REFLECTED AND IF THERE HAD BEEN NO
FEE WAIVERS, THE QUOTED PERFORMANCE WOULD BE LOWER.
<TABLE>
<CAPTION>
<S> <C>
MAXIMUM SALES CHARGES
----------------------------------------
Investors High Grade Bond Fund 3.75%
Investors Bond Fund 3.75%
TaxSaver Bond Fund 3.75%
Maine Municipal Bond Fund 3.00%
New Hampshire Bond Fund 3.00%
Investors Growth Fund 4.00%
Payson Balanced Fund 4.00%
Payson Value Fund 4.00%
----------------------------------------
</TABLE>
5 FORUM FUNDS-Registered Trademark-
<PAGE>
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FORUM FUNDS PERFORMANCE (CONTINUED)
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These charts reflect a comparison in the change in value of a $10,000
investment, including applicable sales charges, in Investors High Grade Bond
Fund, Investors Bond Fund, TaxSaver Bond Fund and Maine Municipal Bond Fund,
including reinvestment of dividends and distributions, to each Fund's related
securities index, over the past 10 fiscal years or since the Funds' inception
(for funds lacking 10-year records). The Lehman Brothers Intermediate
Government/Corporate Index is a market index of fixed-rate government and
investment grade securities with maturities of up to 10 years. The Lehman
Brothers 10 Year Municipal Bond Index is a market index of investment grade
municipal fixed-rate debt securities with an average maturity of 10 years.
Investment return and principal value of an investment in the Funds will
fluctuate so that an investor's shares, when redeemed, may be worth more or less
than their original cost. PAST PERFORMANCE IS NOT PREDICTIVE NOR A GUARANTEE OF
FUTURE RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT INCLUDING SALES CHARGE
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
INVESTORS HIGH GRADE BOND FUND VS. LEHMAN BROTHERS
INTERMEDIATE GOVERNMENT/CORPORATE INDEX
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN ON 3/31/00
<S> <C>
1 Year: (2.45%)
Since Inception on 3/16/98: 1.63%
VALUE ON 3/31/00
Investors High Grade Bond Fund: $10,336
Lehman Index: $10,914
</TABLE>
<TABLE>
<CAPTION>
INVESTORS HIGH
GRADE BOND FUND LEHMAN INDEX
<S> <C> <C>
3/98 $9,625 $10,000
4/98 $9,626 $10,082
5/98 $9,721 $10,156
6/98 $9,795 $10,221
7/98 $9,812 $10,257
8/98 $9,989 $10,418
9/98 $10,244 $10,680
10/98 $10,224 $10,669
11/98 $10,253 $10,669
12/98 $10,282 $10,711
1/99 $10,332 $10,770
2/99 $10,140 $10,612
3/99 $10,198 $10,691
4/99 $10,234 $10,724
5/99 $10,085 $10,641
6/99 $10,048 $10,649
7/99 $10,044 $10,639
8/99 $10,029 $10,647
9/99 $10,118 $10,747
10/99 $10,135 $10,775
11/99 $10,109 $10,788
12/99 $10,033 $10,753
1/00 $9,987 $10,713
2/00 $10,111 $10,802
3/00 $10,336 $10,914
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
INVESTORS BOND FUND VS. LEHMAN BROTHERS INTERMEDIATE
GOVERNMENT/CORPORATE INDEX
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN ON 3/31/00
<S> <C>
1 Year: (2.66%)
5 Year: 5.84%
10 Year: 7.62%
VALUE ON 3/31/00
Investors Bond Fund: $20,833
Lehman Index: $20,491
</TABLE>
<TABLE>
<CAPTION>
INVESTORS LEHMAN
BOND FUND INDEX
<S> <C> <C>
3/90 $9,625 $10,000
4/90 $9,555 $9,965
5/90 $9,782 $10,184
6/90 $9,923 $10,320
7/90 $10,061 $10,464
8/90 $9,986 $10,421
9/90 $10,079 $10,501
10/90 $10,162 $10,623
11/90 $10,373 $10,785
12/90 $10,528 $10,932
1/91 $10,622 $11,043
2/91 $10,682 $11,131
3/91 $10,757 $11,207
4/91 $10,926 $11,329
5/91 $11,057 $11,398
6/91 $11,015 $11,406
7/91 $11,229 $11,534
8/91 $11,440 $11,754
9/91 $11,686 $11,956
10/91 $11,740 $12,092
11/91 $11,835 $12,231
12/91 $12,225 $12,530
1/92 $12,071 $12,417
2/92 $12,148 $12,466
3/92 $12,146 $12,417
4/92 $12,230 $12,526
5/92 $12,446 $12,720
6/92 $12,659 $12,908
7/92 $12,947 $13,165
8/92 $13,002 $13,296
9/92 $13,180 $13,477
10/92 $13,014 $13,302
11/92 $12,994 $13,252
12/92 $13,137 $13,429
1/93 $13,397 $13,690
2/93 $13,677 $13,906
3/93 $13,792 $13,959
4/93 $13,905 $14,074
5/93 $13,936 $14,043
6/93 $14,196 $14,263
7/93 $14,316 $14,298
8/93 $14,627 $14,525
9/93 $14,742 $14,585
10/93 $14,805 $14,624
11/93 $14,679 $14,542
12/93 $14,782 $14,609
1/94 $15,027 $14,771
2/94 $14,753 $14,553
3/94 $14,440 $14,313
4/94 $14,302 $14,215
5/94 $14,317 $14,225
6/94 $14,319 $14,227
7/94 $14,600 $14,431
8/94 $14,658 $14,477
9/94 $14,492 $14,343
10/94 $14,422 $14,341
11/94 $14,436 $14,276
12/94 $14,453 $14,327
1/95 $14,487 $14,568
2/95 $14,870 $14,871
3/95 $15,097 $14,956
4/95 $15,261 $15,140
5/95 $15,632 $15,598
6/95 $15,687 $15,703
7/95 $15,625 $15,705
8/95 $15,724 $15,848
9/95 $15,870 $15,962
10/95 $15,918 $16,140
11/95 $16,189 $16,353
12/95 $16,438 $16,524
1/96 $16,552 $16,666
2/96 $16,483 $16,471
3/96 $16,582 $16,386
4/96 $16,548 $16,328
5/96 $16,592 $16,316
6/96 $16,840 $16,489
7/96 $16,830 $16,538
8/96 $16,912 $16,551
9/96 $17,106 $16,782
10/96 $17,321 $17,078
11/96 $17,624 $17,303
12/96 $17,568 $17,192
1/97 $17,692 $17,259
2/97 $17,742 $17,292
3/97 $17,772 $17,173
4/97 $17,955 $17,375
5/97 $18,060 $17,519
6/97 $18,266 $17,679
7/97 $18,590 $18,039
8/97 $18,547 $17,948
9/97 $18,729 $18,157
10/97 $19,066 $18,358
11/97 $19,237 $18,398
12/97 $19,464 $18,545
1/98 $19,619 $18,788
2/98 $19,633 $18,774
3/98 $19,723 $18,834
4/98 $19,742 $18,929
5/98 $19,952 $19,068
6/98 $20,136 $19,189
7/98 $20,125 $19,257
8/98 $20,397 $19,560
9/98 $20,680 $20,051
10/98 $20,464 $20,031
11/98 $20,563 $20,030
12/98 $20,657 $20,110
1/99 $20,784 $20,221
2/99 $20,388 $19,923
3/99 $20,600 $20,072
4/99 $20,621 $20,134
5/99 $20,406 $19,979
6/99 $20,333 $19,993
7/99 $20,298 $19,975
8/99 $20,305 $19,990
9/99 $20,397 $20,177
10/99 $20,461 $20,229
11/99 $20,430 $20,254
12/99 $20,312 $20,188
1/00 $20,308 $20,114
2/00 $20,461 $20,280
3/00 $20,833 $20,491
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
TAXSAVER BOND FUND VS. LEHMAN BROTHERS 10 YEAR MUNICIPAL BOND INDEX
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN ON 3/31/00
<S> <C>
1 Year: (4.46%)
5 Year: 4.05%
10 Year: 5.99%
VALUE ON 3/31/00
TaxSaver Bond Fund: $17,899
Lehman Index: $20,263
</TABLE>
<TABLE>
<CAPTION>
TAX SAVER BOND LEHMAN
FUND INDEX
<S> <C> <C>
3/90 $9,625 $10,000
4/90 $9,553 $9,933
5/90 $9,744 $10,149
6/90 $9,839 $10,244
7/90 $9,971 $10,386
8/90 $9,883 $10,237
9/90 $9,873 $10,239
10/90 $10,009 $10,464
11/90 $10,168 $10,678
12/90 $10,205 $10,704
1/91 $10,312 $10,881
2/91 $10,375 $10,974
3/91 $10,423 $10,968
4/91 $10,552 $11,120
5/91 $10,603 $11,204
6/91 $10,656 $11,191
7/91 $10,747 $11,308
8/91 $10,845 $11,460
9/91 $10,966 $11,636
10/91 $11,059 $11,731
11/91 $11,099 $11,751
12/91 $11,282 $12,001
1/92 $11,304 $12,026
2/92 $11,339 $12,008
3/92 $11,356 $11,990
4/92 $11,464 $12,104
5/92 $11,585 $12,245
6/92 $11,759 $12,458
7/92 $12,027 $12,866
8/92 $11,958 $12,714
9/92 $12,004 $12,820
10/92 $11,941 $12,689
11/92 $12,148 $12,921
12/92 $12,284 $13,071
1/93 $12,395 $13,291
2/93 $12,766 $13,778
3/93 $12,638 $13,577
4/93 $12,746 $13,706
5/93 $12,814 $13,754
6/93 $12,991 $14,025
7/93 $13,015 $14,060
8/93 $13,239 $14,352
9/93 $13,406 $14,528
10/93 $13,464 $14,552
11/93 $13,384 $14,433
12/93 $13,577 $14,741
1/94 $13,720 $14,922
2/94 $13,504 $14,513
3/94 $13,303 $13,959
4/94 $13,295 $14,112
5/94 $13,445 $14,225
6/94 $13,365 $14,164
7/94 $13,599 $14,402
8/94 $13,611 $14,458
9/94 $13,427 $14,263
10/94 $13,341 $14,055
11/94 $13,205 $13,789
12/94 $13,461 $14,037
1/95 $13,751 $14,401
2/95 $14,027 $14,808
3/95 $14,124 $15,009
4/95 $14,156 $15,027
5/95 $14,494 $15,503
6/95 $14,441 $15,407
7/95 $14,530 $15,633
8/95 $14,680 $15,845
9/95 $14,748 $15,947
10/95 $14,869 $16,131
11/95 $15,090 $16,347
12/95 $15,251 $16,447
1/96 $15,331 $16,614
2/96 $15,296 $16,546
3/96 $15,164 $16,340
4/96 $15,144 $16,282
5/96 $15,173 $16,236
6/96 $15,292 $16,391
7/96 $15,434 $16,548
8/96 $15,450 $16,548
9/96 $15,601 $16,718
10/96 $15,714 $16,930
11/96 $15,933 $17,272
12/96 $15,906 $17,195
1/97 $15,934 $17,262
2/97 $16,059 $17,425
3/97 $15,945 $17,191
4/97 $16,029 $17,318
5/97 $16,191 $17,563
6/97 $16,336 $17,757
7/97 $16,700 $18,256
8/97 $16,586 $18,079
9/97 $16,732 $18,308
10/97 $16,819 $18,405
11/97 $16,904 $18,491
12/97 $17,081 $18,782
1/98 $17,212 $18,990
2/98 $17,226 $18,989
3/98 $17,181 $18,976
4/98 $17,119 $18,872
5/98 $17,379 $19,193
6/98 $17,429 $19,263
7/98 $17,463 $19,294
8/98 $17,691 $19,630
9/98 $17,900 $19,922
10/98 $17,852 $19,930
11/98 $17,899 $19,990
12/98 $17,950 $20,052
1/99 $18,119 $20,360
2/99 $18,048 $20,176
3/99 $18,031 $20,166
4/99 $18,081 $20,220
5/99 $17,997 $20,078
6/99 $17,756 $19,705
7/99 $17,791 $19,838
8/99 $17,653 $19,764
9/99 $17,650 $19,831
10/99 $17,528 $19,691
11/99 $17,649 $19,906
12/99 $17,580 $19,802
1/00 $17,528 $19,721
2/00 $17,666 $19,877
3/00 $17,899 $20,263
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
MAINE MUNICIPAL BOND FUND VS. LEHMAN BROTHERS 10 YEAR MUNICIPAL BOND INDEX
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN ON 3/31/00
<S> <C>
1 Year: (2.58%)
5 Year: 4.50%
Since Inception on 12/5/91: 5.47%
VALUE ON 3/31/00
Maine Municipal Bond Fund: $15,574
Lehman Index: $17,244
</TABLE>
<TABLE>
<CAPTION>
MAINE MUNICIPAL
BOND FUND LEHMAN INDEX
<S> <C> <C>
11/91 $9,700 $10,000
12/91 $9,894 $10,213
1/92 $9,900 $10,235
2/92 $9,859 $10,219
3/92 $9,861 $10,204
4/92 $9,971 $10,301
5/92 $10,083 $10,421
6/92 $10,243 $10,602
7/92 $10,580 $10,949
8/92 $10,466 $10,820
9/92 $10,514 $10,910
10/92 $10,371 $10,799
11/92 $10,580 $10,996
12/92 $10,705 $11,124
1/93 $10,831 $11,311
2/93 $11,174 $11,725
3/93 $11,024 $11,554
4/93 $11,136 $11,664
5/93 $11,181 $11,705
6/93 $11,342 $11,936
7/93 $11,379 $11,966
8/93 $11,615 $12,214
9/93 $11,757 $12,364
10/93 $11,794 $12,385
11/93 $11,689 $12,283
12/93 $11,895 $12,545
1/94 $12,016 $12,699
2/94 $11,743 $12,351
3/94 $11,401 $11,879
4/94 $11,423 $12,010
5/94 $11,535 $12,106
6/94 $11,482 $12,054
7/94 $11,664 $12,256
8/94 $11,701 $12,304
9/94 $11,539 $12,138
10/94 $11,327 $11,961
11/94 $11,127 $11,735
12/94 $11,396 $11,946
1/95 $11,685 $12,256
2/95 $11,996 $12,603
3/95 $12,121 $12,773
4/95 $12,154 $12,788
5/95 $12,518 $13,194
6/95 $12,454 $13,112
7/95 $12,559 $13,304
8/95 $12,681 $13,485
9/95 $12,732 $13,571
10/95 $12,840 $13,728
11/95 $13,010 $13,912
12/95 $13,135 $13,997
1/96 $13,234 $14,139
2/96 $13,199 $14,081
3/96 $13,010 $13,906
4/96 $13,001 $13,857
5/96 $13,019 $13,818
6/96 $13,092 $13,949
7/96 $13,220 $14,083
8/96 $13,228 $14,083
9/96 $13,338 $14,228
10/96 $13,455 $14,408
11/96 $13,647 $14,699
12/96 $13,614 $14,633
1/97 $13,671 $14,691
2/97 $13,771 $14,829
3/97 $13,658 $14,631
4/97 $13,711 $14,738
5/97 $13,856 $14,947
6/97 $13,987 $15,112
7/97 $14,275 $15,537
8/97 $14,163 $15,386
9/97 $14,296 $15,581
10/97 $14,365 $15,664
11/97 $14,419 $15,736
12/97 $14,602 $15,984
1/98 $14,725 $16,161
2/98 $14,724 $16,160
3/98 $14,742 $16,150
4/98 $14,690 $16,060
5/98 $14,881 $16,334
6/98 $14,923 $16,394
7/98 $14,966 $16,420
8/98 $15,185 $16,706
9/98 $15,349 $16,954
10/98 $15,351 $16,961
11/98 $15,379 $17,012
12/98 $15,424 $17,065
1/99 $15,593 $17,327
2/99 $15,519 $17,171
3/99 $15,507 $17,162
4/99 $15,563 $17,208
5/99 $15,493 $17,087
6/99 $15,294 $16,770
7/99 $15,366 $16,882
8/99 $15,282 $16,820
9/99 $15,295 $16,877
10/99 $15,181 $16,758
11/99 $15,295 $16,941
12/99 $15,250 $16,852
1/00 $15,195 $16,784
2/00 $15,324 $16,916
3/00 $15,574 $17,244
</TABLE>
6 FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
FORUM FUNDS PERFORMANCE (CONTINUED)
--------------------------------------------------------------------------------
These charts reflect a comparison in the change in value of a $10,000
investment, including applicable sales charges, in New Hampshire Bond Fund,
Investors Growth Fund, Payson Balanced Fund and Payson Value Fund, including
reinvestment of dividends and distributions, to each Fund's related securities
index, since the Funds' inception. The Lehman Brothers 10 Year Municipal Bond
Index is a market index of investment grade municipal fixed-rate debt securities
with an average maturity of 10 years. The Standard and Poor's 500 Composite
Index ("S&P 500") is a market weighted index composed of 500 large
capitalization companies and reflects the reinvestment of dividends. Investment
return and principal value of an investment in the Funds will fluctuate so that
an investor's shares, when redeemed, may be worth more or less than their
original cost. PAST PERFORMANCE IS NOT PREDICTIVE NOR A GUARANTEE OF FUTURE
RESULTS.
COMPARISON OF CHANGE IN VALUE OF A $10,000 INVESTMENT INCLUDING SALES CHARGE
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
NEW HAMPSHIRE BOND FUND VS. LEHMAN BROTHERS 10 YEAR MUNICIPAL BOND INDEX
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN ON 3/31/00
<S> <C>
1 Year: (2.97%)
5 Year: 4.60%
Since Inception on 12/31/92: 4.89%
VALUE ON 3/31/00
New Hampshire Bond Fund : $14,132
Lehman Index: $15,502
</TABLE>
<TABLE>
<CAPTION>
NEW HAMPSHIRE
BOND FUND LEHMAN INDEX
<S> <C> <C>
12/92 $9,700 $10,000
1/93 $9,696 $10,168
2/93 $10,067 $10,540
3/93 $9,830 $10,386
4/93 $9,956 $10,485
5/93 $10,025 $10,522
6/93 $10,225 $10,730
7/93 $10,281 $10,756
8/93 $10,553 $10,979
9/93 $10,705 $11,115
10/93 $10,698 $11,133
11/93 $10,609 $11,042
12/93 $10,850 $11,277
1/94 $10,971 $11,416
2/94 $10,671 $11,103
3/94 $10,297 $10,679
4/94 $10,326 $10,796
5/94 $10,431 $10,883
6/94 $10,379 $10,836
7/94 $10,568 $11,018
8/94 $10,600 $11,060
9/94 $10,454 $10,911
10/94 $10,293 $10,752
11/94 $10,145 $10,549
12/94 $10,352 $10,739
1/95 $10,609 $11,017
2/95 $10,878 $11,329
3/95 $10,949 $11,482
4/95 $10,968 $11,496
5/95 $11,319 $11,860
6/95 $11,257 $11,787
7/95 $11,344 $11,960
8/95 $11,466 $12,122
9/95 $11,522 $12,200
10/95 $11,632 $12,340
11/95 $11,788 $12,506
12/95 $11,881 $12,583
1/96 $11,981 $12,710
2/96 $11,923 $12,658
3/96 $11,754 $12,500
4/96 $11,732 $12,456
5/96 $11,725 $12,421
6/96 $11,814 $12,539
7/96 $11,919 $12,659
8/96 $11,923 $12,660
9/96 $12,047 $12,790
10/96 $12,165 $12,952
11/96 $12,353 $13,213
12/96 $12,307 $13,154
1/97 $12,344 $13,206
2/97 $12,435 $13,330
3/97 $12,291 $13,152
4/97 $12,350 $13,249
5/97 $12,519 $13,436
6/97 $12,638 $13,585
7/97 $12,928 $13,966
8/97 $12,819 $13,831
9/97 $12,951 $14,006
10/97 $13,013 $14,080
11/97 $13,071 $14,146
12/97 $13,246 $14,369
1/98 $13,358 $14,528
2/98 $13,390 $14,527
3/98 $13,377 $14,517
4/98 $13,351 $14,437
5/98 $13,538 $14,683
6/98 $13,574 $14,737
7/98 $13,612 $14,761
8/98 $13,814 $15,017
9/98 $13,964 $15,240
10/98 $13,988 $15,247
11/98 $14,010 $15,293
12/98 $14,058 $15,340
1/99 $14,200 $15,575
2/99 $14,142 $15,435
3/99 $14,128 $15,427
4/99 $14,165 $15,469
5/99 $14,098 $15,360
6/99 $13,911 $15,075
7/99 $13,976 $15,176
8/99 $13,909 $15,120
9/99 $13,906 $15,171
10/99 $13,825 $15,064
11/99 $13,930 $15,229
12/99 $13,877 $15,149
1/00 $13,823 $15,087
2/00 $13,942 $15,206
3/00 $14,132 $15,502
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
INVESTORS GROWTH FUND VS. S&P 500 INDEX
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN ON 3/31/00
<S> <C>
1 Year: 2.28%
Since Inception on 12/12/97: 9.55%
VALUE ON 3/31/00
Investors Growth Fund: $12,334
S&P 500 Index: $16,191
</TABLE>
<TABLE>
<CAPTION>
INVESTORS GROWTH S&P 500
FUND INDEX
<S> <C> <C>
11/97 $9,600 $10,000
12/97 $9,802 $10,172
1/98 $9,917 $10,284
2/98 $10,474 $11,025
3/98 $10,896 $11,589
4/98 $10,925 $11,706
5/98 $10,694 $11,505
6/98 $10,884 $11,972
7/98 $10,585 $11,845
8/98 $9,226 $10,135
9/98 $9,776 $10,784
10/98 $10,375 $11,661
11/98 $10,858 $12,368
12/98 $11,434 $13,080
1/99 $11,584 $13,627
2/99 $11,354 $13,203
3/99 $11,577 $13,731
4/99 $11,936 $14,262
5/99 $11,517 $13,926
6/99 $12,093 $14,698
7/99 $11,303 $14,239
8/99 $11,083 $14,168
9/99 $10,847 $13,780
10/99 $11,297 $14,651
11/99 $11,477 $14,949
12/99 $12,076 $15,828
1/00 $11,617 $15,034
2/00 $11,170 $14,749
3/00 $12,334 $16,191
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
PAYSON BALANCED FUND VS. S&P 500 INDEX
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN ON 3/31/00
<S> <C>
1 Year: 0.35%
5 Year: 10.00%
Since Inception on 11/25/91: 9.71%
VALUE ON 3/31/00
Payson Balanced Fund: $21,273
S&P 500 Index: $47,980
</TABLE>
<TABLE>
<CAPTION>
PAYSON BALANCED S&P 500
FUND INDEX
<S> <C> <C>
11/91 $9,600 $10,000
12/91 $10,147 $11,142
1/92 $9,974 $10,934
2/92 $10,061 $11,076
3/92 $9,897 $10,861
4/92 $9,994 $11,179
5/92 $10,091 $11,234
6/92 $10,004 $11,067
7/92 $10,297 $11,519
8/92 $10,199 $11,283
9/92 $10,355 $11,416
10/92 $10,267 $11,455
11/92 $10,582 $11,844
12/92 $10,887 $11,989
1/93 $11,075 $12,090
2/93 $11,205 $12,255
3/93 $11,393 $12,513
4/93 $11,323 $12,210
5/93 $11,513 $12,536
6/93 $11,843 $12,572
7/93 $11,914 $12,522
8/93 $12,377 $12,996
9/93 $12,407 $12,894
10/93 $12,488 $13,160
11/93 $12,336 $13,035
12/93 $12,624 $13,193
1/94 $13,068 $13,641
2/94 $12,820 $13,271
3/94 $12,190 $12,693
4/94 $12,159 $12,856
5/94 $12,211 $13,066
6/94 $11,826 $12,746
7/94 $12,162 $13,164
8/94 $12,561 $13,703
9/94 $12,298 $13,369
10/94 $12,309 $13,668
11/94 $11,885 $13,172
12/94 $12,094 $13,367
1/95 $12,288 $13,713
2/95 $12,750 $14,246
3/95 $12,922 $14,666
4/95 $13,074 $15,098
5/95 $13,508 $15,700
6/95 $13,606 $16,065
7/95 $13,858 $16,597
8/95 $14,077 $16,638
9/95 $14,471 $17,340
10/95 $14,604 $17,278
11/95 $15,112 $18,036
12/95 $15,521 $18,383
1/96 $15,794 $19,008
2/96 $15,714 $19,185
3/96 $15,726 $19,370
4/96 $15,749 $19,655
5/96 $15,818 $20,161
6/96 $15,726 $20,238
7/96 $15,136 $19,344
8/96 $15,495 $19,753
9/96 $16,038 $20,863
10/96 $16,411 $21,439
11/96 $17,261 $23,058
12/96 $17,259 $22,601
1/97 $17,621 $24,012
2/97 $17,751 $24,201
3/97 $17,207 $23,208
4/97 $17,702 $24,592
5/97 $18,667 $26,089
6/97 $19,110 $27,257
7/97 $20,382 $29,426
8/97 $20,133 $27,778
9/97 $20,894 $29,298
10/97 $20,246 $28,321
11/97 $20,669 $29,631
12/97 $20,882 $30,140
1/98 $20,973 $30,473
2/98 $22,021 $32,669
3/98 $22,588 $34,340
4/98 $22,619 $34,685
5/98 $21,794 $34,090
6/98 $21,277 $35,474
7/98 $20,355 $35,097
8/98 $17,836 $30,028
9/98 $18,668 $31,951
10/98 $20,153 $34,548
11/98 $20,942 $36,640
12/98 $21,619 $38,750
1/99 $21,438 $40,370
2/99 $20,266 $39,116
3/99 $20,735 $40,681
4/99 $21,915 $42,257
5/99 $21,815 $41,261
6/99 $22,237 $43,549
7/99 $21,703 $42,191
8/99 $21,620 $41,982
9/99 $20,547 $40,833
10/99 $20,883 $43,415
11/99 $20,749 $44,298
12/99 $20,589 $46,906
1/00 $19,773 $44,549
2/00 $19,501 $43,706
3/00 $21,273 $47,980
</TABLE>
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
PAYSON VALUE FUND VS. S&P 500 INDEX
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN ON 3/31/00
<S> <C>
1 Year: 12.51%
5 Year: 17.63%
Since Inception on 7/31/92: 15.25%
VALUE ON 3/31/00
Payson Value Fund: $29,674
S&P 500 Index: $41,653
</TABLE>
<TABLE>
<CAPTION>
PAYSON VALUE S&P 500
FUND INDEX
<S> <C> <C>
7.92 $9,600 $10,000
8.92 $9,389 $9,796
9.92 $9,466 $9,911
10.92 $9,408 $9,944
11.92 $9,899 $10,282
12.92 $10,274 $10,408
1.93 $10,497 $10,495
2.93 $10,497 $10,638
3.93 $10,661 $10,863
4.93 $10,487 $10,600
5.93 $10,768 $10,883
6.93 $10,952 $10,915
7.93 $11,175 $10,871
8.93 $11,622 $11,282
9.93 $11,680 $11,193
10.93 $12,031 $11,424
11.93 $11,914 $11,316
12.93 $12,265 $11,453
1.94 $12,882 $11,842
2.94 $12,627 $11,521
3.94 $11,874 $11,020
4.94 $12,011 $11,161
5.94 $12,070 $11,344
6.94 $11,541 $11,066
7.94 $11,984 $11,429
8.94 $12,603 $11,897
9.94 $12,269 $11,607
10.94 $12,308 $11,866
11.94 $11,736 $11,435
12.94 $11,815 $11,604
1.95 $11,944 $11,904
2.95 $12,410 $12,368
3.95 $12,648 $12,733
4.95 $12,738 $13,107
5.95 $13,166 $13,630
6.95 $13,345 $13,946
7.95 $13,824 $14,408
8.95 $13,854 $14,444
9.95 $14,254 $15,053
10.95 $14,184 $14,999
11.95 $14,766 $15,657
12.95 $15,144 $15,959
1.96 $15,647 $16,502
2.96 $15,798 $16,655
3.96 $16,161 $16,815
4.96 $16,221 $17,063
5.96 $16,413 $17,502
6.96 $16,383 $17,569
7.96 $15,471 $16,794
8.96 $16,049 $17,148
9.96 $16,768 $18,112
10.96 $17,175 $18,611
11.96 $18,141 $20,017
12.96 $18,014 $19,621
1.97 $18,558 $20,846
2.97 $18,716 $21,010
3.97 $18,263 $20,148
4.97 $18,921 $21,350
5.97 $20,055 $22,649
6.97 $20,827 $23,663
7.97 $22,134 $25,545
8.97 $21,452 $24,116
9.97 $22,918 $25,435
10.97 $22,269 $24,587
11.97 $23,134 $25,724
12.97 $23,710 $26,166
1.98 $23,845 $26,455
2.98 $25,399 $28,362
3.98 $26,533 $29,812
4.98 $26,631 $30,112
5.98 $25,639 $29,595
6.98 $25,398 $30,796
7.98 $24,149 $30,469
8.98 $20,096 $26,068
9.98 $21,461 $27,738
10.98 $23,044 $29,993
11.98 $23,878 $31,810
12.98 $25,082 $33,642
1.99 $25,332 $35,048
2.99 $24,322 $33,960
3.99 $25,320 $35,319
4.99 $27,720 $36,687
5.99 $27,261 $35,821
6.99 $28,335 $37,807
7.99 $26,812 $36,627
8.99 $26,773 $36,446
9.99 $25,802 $35,448
10.99 $26,932 $37,690
11.99 $27,484 $38,456
12.99 $27,638 $40,720
1.00 $27,231 $38,674
2.00 $26,552 $37,943
3.00 $29,674 $41,653
</TABLE>
7 FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
INVESTORS HIGH GRADE BOND FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
CORPORATE BONDS & NOTES (19.6%)
$1,000,000 ABN Amro Bank, North America Finance,
Inc., 8.25%, 8/1/09................... $ 1,017,990
1,500,000 CNA Financial Corp., 6.45%, 1/15/08..... 1,369,470
2,000,000 Lehman Brothers Holdings, Inc., 8.50%,
8/1/15................................ 2,107,000
1,000,000 Mercantile Banc Corp., 7.30%, 6/15/07... 983,440
-----------
Total Corporate Bonds & Notes
(cost $5,503,686) 5,477,900
-----------
GOVERNMENT AGENCY NOTES (2.7%)
FNMA (2.7%)
750,000 7.50%, 2/11/02.......................... 757,035
-----------
Total Government Agency Notes
(cost $772,266) 757,035
-----------
GOVERNMENT MORTGAGE BACKED SECURITIES (10.5%)
GNMA (10.5%)
3,106,220 6.50%, 3/15/28 - 4/15/28................ 2,932,462
-----------
Total Government Mortgage Backed Securities
(cost $3,106,224) 2,932,462
-----------
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
U.S. TREASURY OBLIGATIONS (67.0%)
U.S. TREASURY BONDS (8.5%)
$2,650,000 5.25%, 11/15/28......................... $ 2,372,969
-----------
U.S. TREASURY NOTES (58.5%)
1,000,000 5.88%, 2/15/04.......................... 983,840
2,000,000 7.25%, 5/15/04.......................... 2,061,920
3,000,000 6.50%, 8/15/05.......................... 3,021,270
10,000,000 5.88%, 11/15/05......................... 9,786,900
500,000 6.25%, 2/15/07.......................... 499,400
-----------
Total U.S. Treasury Notes 16,353,330
-----------
Total U.S. Treasury Obligations
(cost $19,686,453) 18,726,299
-----------
SHORT-TERM HOLDINGS (0.2%)
54,278 Bankers Trust Investment Money Market
Fund, 5.85%, 4/3/00 (cost $54,278).... 54,278
-----------
Total Investments (100.0%)
(cost $29,122,907) $27,947,974
===========
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
8
<PAGE>
--------------------------------------------------------------------------------
INVESTORS BOND FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
COLLATERALIZED MORTGAGE OBLIGATIONS (2.0%)
$ 121,161 Merrill Lynch Mortgage Investors, Inc.,
Series 89 E, 9.40%, 9/15/09........... $ 123,000
899,307 RTC, Series 92 C8 D, 8.84%, 12/25/23.... 893,686
-----------
Total Collateralized Mortgage Obligations
(cost $1,007,308) 1,016,686
-----------
CORPORATE BONDS & NOTES (67.6%)
3,245,000 ABN Amro Bank, North America Finance,
Inc., 8.25%, 8/1/09................... 3,303,378
7,250,000 Bank United, 8.00%, 3/15/09............. 6,603,663
1,500,000 Bankers Trust New York Co., 7.25%,
10/15/11.............................. 1,465,710
1,500,000 Bear Stearns Cos., Inc., 7.63%,
12/07/09.............................. 1,463,957
3,000,000 CBS, Inc., ACA insured, 7.63%, 1/1/02... 3,006,930
7,000,000 Comerica Bank, 8.38%, 7/15/24........... 7,089,670
3,000,000 Conseco, Inc., 8.70%, 11/15/26.......... 2,616,270
1,500,000 Cummins Engine Co., Inc., 6.45%,
3/1/05................................ 1,413,390
2,500,000 Lehman Brothers Holdings, Inc., 7.20%,
8/15/09............................... 2,394,925
1,000,000 Leucadia Capital Trust I, 8.65%,
1/15/27............................... 735,942
3,000,000 Paine Webber Group, Inc., 7.39%,
10/16/17.............................. 2,791,710
1,000,000 Sears Roebuck Acceptance Corp., 6.70%,
11/15/06.............................. 948,830
-----------
Total Corporate Bonds & Notes
(cost $36,741,717) 33,834,375
-----------
GOVERNMENT MORTGAGE BACKED SECURITIES (11.3%)
FHLMC (0.1%)
40,026 Pool 502128, 9.00%, 10/1/04............. 41,326
-----------
GNMA (11.2%)
77,345 Pool 406467, 6.50%, 3/15/26............. 73,019
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
GNMA, CONTINUED
$ 103,382 Pool 430637, 6.50%, 4/15/28............. $ 97,599
149,599 Pool 452743, 6.50%, 12/15/27............ 141,231
1,530,344 Pool 462480, 6.50%, 1/15/28............. 1,444,736
440,133 Pool 462903, 6.50%, 2/15/28............. 415,512
39,160 Pool 463682, 6.50%, 3/15/28............. 36,969
3,064,133 Pool 463821, 6.50%, 4/15/28............. 2,892,726
65,530 Pool 473533, 6.50%, 4/15/28............. 61,865
200,048 Pool 473541, 6.50%, 4/15/28............. 188,857
279,369 Pool 474630, 6.50%, 4/15/28............. 263,741
-----------
Total GNMA 5,616,255
-----------
Total Government Mortgage Backed Securities
(cost $5,897,185) 5,657,581
-----------
MUNICIPAL BONDS (2.5%)
1,151,024 Coffee County, GA, Hospital Authority
RV, Taxable Anticipation Certificates,
Series B, ACA insured, 9.00%, 12/1/12
(cost $1,269,004)+.................... 1,239,665
-----------
U.S. TREASURY BONDS (6.4%)
3,600,000 5.25%, 11/15/28 (cost $3,422,770)....... 3,223,656
-----------
PREFERRED STOCKS (7.0%)
4,000,000 Irwin Financial Corp., Capital Trust I,
9.25%................................. 1,000,000
6,850,000 NCBE Capital Trust, 8.25%............... 1,507,000
8,000,000 Simmons First National Corp., 9.12%..... 996,248
-----------
Total Preferred Stock
(cost $3,738,300) 3,503,248
-----------
SHORT-TERM HOLDINGS (3.2%)
1,616,118 Bankers Trust Investment Money Market
Fund, 5.85%, 4/3/00 (cost
$1,616,118)........................... 1,616,118
-----------
Total Investments (100.0%)
(cost $53,692,402) $50,091,329
===========
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
9
<PAGE>
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TAXSAVER BOND FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
MUNICIPAL BONDS & NOTES (99.8%)
COLORADO (4.4%)
$1,000,000 Douglas County, CO, SD #1, GO Bonds,
Series A, 8.00%, 12/15/09............. $ 1,223,600
-----------
GUAM (0.6%)
170,000 Guam Government LO Highway RV, Series A,
FSA insured, 6.25%, 5/1/07............ 177,913
-----------
ILLINOIS (5.0%)
350,000 Illinois Development Finance Authority
RV, Community Rehabilitation Providers
Facilities Acquisition Program, Series
92, 8.25%, 8/1/12..................... 371,333
1,000,000 Illinois State, GO Bonds, 5.70%,
4/1/10................................ 1,025,080
-----------
1,396,413
-----------
INDIANA (0.4%)
100,000 Indiana Health Facilities Financing
Authority Hospital RV, Community
Hospital of Indiana, Series A & B,
MBIA insured, 6.35%, 7/1/03........... 104,222
-----------
KENTUCKY (11.3%)
2,000,000 Carroll County, KY, PCR Bonds, Kentucky
Utilities Co. Project, Series A,
7.45%, 9/15/16........................ 2,130,280
1,000,000 Kenton County, KY, Water District RV,
6.00%, 2/1/17......................... 1,036,150
-----------
3,166,430
-----------
LOUISIANA (4.5%)
1,000,000 Louisana Public Facilities Authority RV,
Extended Care Facilities Authority
Comm-Care Corp., 11.00%, 2/1/14....... 1,273,440
-----------
MICHIGAN (3.7%)
1,000,000 Michigan State, Strategic Fund,
Obligation RV, 6.50%, 2/15/16......... 1,043,650
-----------
MISSOURI (5.2%)
1,000,000 Kansas City, MO, IDA RV, Owens-
Illinois, PJ-Conv, 4.90%, 12/31/08.... 936,090
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
MISSOURI, CONTINUED
$ 500,000 Sikeston, MO, Electric RV, 6.00%,
6/1/16................................ $ 533,990
-----------
1,470,080
-----------
MONTANA (3.6%)
1,000,000 Forsyth, MT, PCR RV Refunding, Montana
Power Co., Series A, AMBAC insured,
6.13%, 5/1/23......................... 1,010,350
-----------
NEVADA (0.3%)
75,000 Big Bend Water District, MBIA insured,
7.25%, 11/1/05........................ 77,804
-----------
NEW HAMPSHIRE (0.9%)
250,000 New Hampshire, HEFA RV, Kendal at
Hanover Issue, Bank of Ireland, LOC,
5.80%, 10/1/12........................ 249,143
-----------
NEW JERSEY (3.7%)
1,000,000 Essex County, NJ, Improvement Authority
RV, Utilities System East Orange
Franchise, MBIA insured, 6.00%,
7/1/18................................ 1,033,940
-----------
NEW YORK (3.8%)
1,000,000 New York, NY, IDA, Civic Facilities RV,
USTA National Tennis Center Project,
FSA insured, 6.40%, 11/15/08.......... 1,075,570
-----------
OHIO (21.4%)
1,000,000 Cleveland, OH, Public Power System RV,
7.00%, 11/15/17....................... 1,050,800
2,000,000 Hamilton, OH, Electrical System Mortgage
RV, Series A, FGIC insured, 6.00%,
10/15/23.............................. 2,020,060
275,000 Montgomery County, OH, GO Bonds, 5.30%,
12/1/10............................... 279,353
795,000 Northwest, OH, SD LOC, GO Bonds, FGIC
insured, 5.50%, 12/1/12............... 819,470
500,000 Ohio State Air Quality Development
Authority, PCR Bonds, Cleveland
Electric Co. Project, FGIC insured,
8.00%, 12/1/13........................ 542,945
500,000 Ohio State Turnpike Community, RV,
Series A, 5.50%, 2/15/24.............. 490,520
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
10
<PAGE>
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TAXSAVER BOND FUND
SCHEDULE OF INVESTMENTS (continued)
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
OHIO, CONTINUED
$ 445,000 Shelby County, OH, Hospital Facilities
RV, Wilson Memorial Hospital, ETM USG,
6.40%, 12/1/03........................ $ 455,400
355,000 Washington County, OH, Hospital RV,
Shelby General Hospital, 6.88%,
7/1/03................................ 359,114
-----------
6,017,662
-----------
OKLAHOMA (0.9%)
250,000 Claremore, OK, Public Works Authority
Capital Improvement RV, MBIA insured,
5.00%, 6/1/05......................... 250,943
-----------
PENNSYLVANIA (9.6%)
425,000 Allegheny County, PA, Hospital
Development Authority, Health Care RV,
Allegheny Valley School Project,
7.25%, 2/1/03......................... 422,803
1,000,000 Allegheny County, PA, Hospital
Development Authority, Health Center
RV, Series 90, West Penn Hospital
Foundation, 8.00%, 1/1/05............. 1,031,970
500,000 Bucks County, PA, IDA RV, Personal Care,
ETM USG, Series A, 10.00%, 5/15/19.... 749,520
240,000 Erie-Western Pennsylvania Port
Authority, Pennsylvania Refunding RV,
8.25%, 6/15/00........................ 241,944
110,000 Pennsylvania HEFA RV, Medical College of
Pennsylvania, Series 91 B, 7.25%,
3/1/05................................ 115,094
125,000 Washington County, PA, IDA RV,
Presbyterian Medical Center, FHA
insured, 6.50%, 1/15/02............... 128,531
-----------
2,689,862
-----------
PUERTO RICO (6.5%)
50,000 Puerto Rico Commonwealth, GO Bonds,
MBIA-IBC insured, 5.50%, 7/1/08....... 52,133
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
PUERTO RICO, CONTINUED
$ 680,000 Puerto Rico Commonwealth, GO Bonds, MBIA
insured, 5.75%, 7/1/10................ $ 724,105
1,000,000 Puerto Rico Commonwealth, GO
Improvements Bonds, 5.50%, 7/1/13..... 1,025,010
35,000 Puerto Rico Public Finance Corp.,
Commonwealth Appropriations RV, Series
A, 5.38%, 6/1/18...................... 34,876
-----------
1,836,124
-----------
VIRGIN ISLANDS (2.5%)
75,000 Virgin Islands PFA, Economic RV, ETM
USG, 7.30%, 10/1/18................... 89,573
625,000 Virgin Islands PFA RV, Sub-Lien Fund
Loan Notes, Series D, 6.00%,
10/1/05............................... 622,550
-----------
712,123
-----------
WASHINGTON (6.8%)
1,175,000 Pierce County, WA, HFA RV, Pooled,
6.00%, 12/1/28........................ 1,047,524
1,000,000 Vancouver, WA, HFA RV, Housing-
Sub-Springbrook Square B, 6.00%,
3/1/31................................ 872,970
-----------
1,920,494
-----------
WEST VIRGINIA (4.7%)
1,300,000 Monongalia County, WV, Pollution RV,
Potomac Edison Co. Fort Martin, Series
B, 5.95%, 4/1/13...................... 1,318,200
-----------
Total Municipal Bonds & Notes
(cost $28,583,273) 28,047,963
-----------
SHORT-TERM HOLDINGS (0.2%)
42,360 Bankers Trust Investment Tax-Free Money
Market Fund, 3.46%, 4/3/00 (cost
$42,360).............................. 42,360
-----------
Total Investments (100.0%)
(cost $28,625,633) $28,090,323
===========
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
11
<PAGE>
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MAINE MUNICIPAL BOND FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
MUNICIPAL BONDS & NOTES (99.7%)
GENERAL OBLIGATION -- BOND BANK (3.4%)
$ 20,000 Maine Muni Bond Bank, Series A, 5.00%,
11/1/04............................... $ 20,117
20,000 Maine Muni Bond Bank, Series B, 5.40%,
11/1/02............................... 20,348
10,000 Maine Muni Bond Bank, Series C, 6.45%,
11/1/01............................... 10,282
25,000 Maine Muni Bond Bank, Series D, 5.90%,
11/1/00............................... 25,250
90,000 Maine Muni Bond Bank, Series E, 5.70%,
11/1/11............................... 92,985
210,000 Maine Muni Bond Bank, Series 90B, 7.20%,
11/1/07, P/R 11/1/00 @ 102............ 217,766
50,000 Maine Muni Bond Bank, Series 90B, 7.20%,
11/1/11, P/R 11/1/00 @ 102............ 51,849
150,000 Maine Muni Bond Bank, Series 90B, 7.20%,
11/1/15, P/R USG, 11/1/00 @ 102....... 155,547
25,000 Maine Muni Bond Bank, Series 90D, 7.38%,
11/1/10, P/R USG, 11/1/00 @ 102....... 25,949
100,000 Maine Muni Bond Bank, Series 92B, 6.65%,
11/1/07............................... 106,556
85,000 Maine Muni Bond Bank, Series 92B, 6.75%,
11/1/12............................... 90,648
150,000 Maine Muni Bond Bank, Series 92E, 5.80%,
11/1/04............................... 155,757
80,000 Maine Muni Bond Bank, Sewer & Water
Bonds, SRF Program, 7.20%, 11/1/13,
P/R USG, 11/1/01 @ 102................ 84,686
20,000 Maine Muni Bond Bank, Sewer & Water RV,
SRF Program, 4.75%, 11/1/03........... 19,989
-----------
1,077,729
-----------
GENERAL OBLIGATION -- LOCAL (17.2%)
100,000 Bangor, ME, LTGO Bonds, Bangor
International Airport Project, 5.75%,
10/1/01............................... 101,489
25,000 Bangor, ME, LTGO Bonds, Bangor
International Airport Project, 5.85%,
10/1/02............................... 25,538
150,000 Bangor, ME, LTGO Bonds, Bangor
International Airport Project, 6.00%,
10/1/03............................... 154,448
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
GENERAL OBLIGATION -- LOCAL, CONTINUED
$ 100,000 Bangor, ME, LTGO Bonds, Bangor
International Airport Project, 6.10%,
10/1/04............................... $ 103,753
250,000 Bangor, ME, LTGO Bonds, Bangor
International Airport Project, 6.35%,
10/1/07............................... 260,345
100,000 Bangor, ME, UTGO Bonds, 5.20%,
11/1/00............................... 100,644
60,000 Bangor, ME, UTGO Bonds, 5.50%, 9/1/24... 61,952
175,000 Bar Harbor, ME, UTGO Bonds, 6.20%,
6/1/05................................ 184,030
75,000 Bar Harbor, ME, UTGO Bonds, 6.45%,
6/1/09................................ 81,005
30,000 Bath, ME, UTGO Bonds, 7.45%, 12/1/07.... 34,537
20,000 Bath, ME, UTGO Bonds, 7.50%, 12/1/08.... 23,334
25,000 Bath, ME, UTGO Bonds, 5.63%, 3/1/09..... 26,014
25,000 Blue Hill, ME, UTGO Bonds, 7.30%,
7/1/06................................ 27,565
50,000 Brewer, ME, UTGO Bonds, Series A, 6.10%,
1/1/03................................ 51,662
50,000 Brewer, ME, UTGO Bonds, Series A, 6.10%,
1/1/04................................ 52,077
50,000 Brewer, ME, UTGO Bonds, Series A, 6.10%,
1/1/05................................ 52,355
50,000 Brewer, ME, UTGO Bonds, Series A, 6.20%,
1/1/06................................ 52,412
50,000 Brunswick, ME, Tax Increment GO Bonds,
BTI Project, 5.50%, 11/1/08........... 51,448
25,000 Bucksport, ME, GO Bonds, Local, School &
Public Improvements, 7.15%, 4/1/07.... 27,530
250,000 Cape Elizabeth, ME, GO Bonds, 5.75%,
10/15/09.............................. 263,032
100,000 Cape Elizabeth, ME, GO Bonds, 5.90%,
10/15/12.............................. 105,818
25,000 Cape Elizabeth, ME, GO Bonds, 5.90%,
10/15/14.............................. 26,455
100,000 Cumberland County, ME, UTGO Bonds,
6.50%, 2/1/03, P/R USG, 2/1/01 @
102................................... 103,817
250,000 Cumberland County, ME, UTGO Bonds,
5.25%, 2/1/07......................... 254,503
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
12
<PAGE>
--------------------------------------------------------------------------------
MAINE MUNICIPAL BOND FUND
SCHEDULE OF INVESTMENTS (continued)
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
GENERAL OBLIGATION -- LOCAL, CONTINUED
$ 25,000 Ellsworth, ME, UTGO Bonds, 7.20%,
7/1/08................................ $ 28,023
250,000 Freeport, ME, UTGO Bonds, 7.25%,
9/1/04................................ 273,635
20,000 Freeport, ME, UTGO Bonds, 7.25%,
9/1/10................................ 23,375
40,000 Old Orchard Beach, ME, UTGO Bonds, MBIA
insured, 6.40%, 9/1/04................ 42,622
215,000 Old Orchard Beach, ME, UTGO Bonds, MBIA
insured, 6.60%, 9/1/06................ 230,046
50,000 Old Orchard Beach, ME, UTGO Bonds, MBIA
insured, 6.65%, 9/1/07................ 53,556
70,000 Old Orchard Beach, ME, UTGO Bonds, MBIA
insured, 6.65%, 9/1/08................ 74,978
35,000 Old Orchard Beach, ME, UTGO Bonds, MBIA
insured, 6.65%, 9/1/10................ 37,489
500,000 Portland, ME, GO Bonds, 6.20%, 4/1/05... 532,440
50,000 Portland, ME, GO Bonds, 12.60%,
11/1/05............................... 68,061
100,000 Portland, ME, GO Bonds, 7.25%,
12/1/05............................... 111,324
790,000 Portland, ME, GO Bonds, 5.30%,
6/13/13............................... 788,238
25,000 Portland, ME, GO Bonds, 6.50%, 4/1/14... 26,939
10,000 Rockland ME, GO Bonds, 6.00%, 10/1/00... 10,080
25,000 Rockland ME, GO Bonds, 6.00%, 10/1/01... 25,447
150,000 South Portland, ME, GO Bonds, 5.80%,
9/1/08................................ 158,630
40,000 South Portland, ME, GO Bonds, 5.80%,
9/1/11................................ 42,506
25,000 Westbrook, ME, UTGO Bonds, 6.75%,
11/15/04.............................. 27,003
75,000 Windham, ME, UTGO Bonds, 0.05%,
6/15/08............................... 48,815
130,000 Winslow, ME, GO Bonds, Crowe Rope
Industries Project, Series A, 5.50%,
3/1/07................................ 132,046
50,000 Winslow, ME, UTGO Bonds, SD, AMBAC
insured, 7.00%, 10/1/10............... 52,771
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
GENERAL OBLIGATION -- LOCAL, CONTINUED
$ 20,000 Winslow, ME, UTGO Bonds, AMBAC insured,
6.90%, 10/1/08........................ $ 21,079
25,000 Winthrop, ME, UTGO Bonds, 5.10%,
8/1/04................................ 25,235
25,000 Winthrop, ME, UTGO Bonds, 5.20%,
8/1/05................................ 25,317
25,000 Winthrop, ME, UTGO Bonds, 5.30%,
8/1/06................................ 25,394
25,000 Winthrop, ME, UTGO Bonds, 5.40%,
8/1/07................................ 25,521
250,000 Yarmouth, ME, GO Bonds, AMBAC insured,
5.25%, 11/15/09....................... 253,473
35,000 York, ME, SD, UTGO Bonds, AMBAC insured,
6.40%, 3/1/03......................... 36,376
-----------
5,426,182
-----------
GENERAL OBLIGATION -- STATE (1.2%)
50,000 Maine, UTGO Bonds, 8.00%, 5/1/01........ 51,945
90,000 Maine, UTGO Bonds, 6.40%, 7/1/02........ 93,326
25,000 Maine, UTGO Bonds, 7.50%, 12/15/02...... 26,773
100,000 Maine, UTGO Bonds, 6.50%, 7/1/03........ 105,219
100,000 Maine, UTGO Bonds, Highway Improvements,
8.00%, 5/1/02......................... 106,501
-----------
383,764
-----------
GENERAL OBLIGATION -- PUERTO RICO (7.1%)
1,150,000 Puerto Rico Commonwealth, GO Bonds, MBIA
insured, 6.50%, 7/1/04................ 1,230,856
525,000 Puerto Rico Commonwealth, GO Bonds, MBIA
insured, 5.75%, 7/1/10................ 559,052
430,000 Puerto Rico Commonwealth, GO Bonds,
Series 93, MBIA-IBC insured, 5.50%,
7/1/08................................ 448,340
-----------
2,238,248
-----------
REVENUE -- GUAM (9.0%)
800,000 Guam Government LO Highway RV, Series A,
FSA insured, 6.25%, 5/1/07............ 837,240
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
13
<PAGE>
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MAINE MUNICIPAL BOND FUND
SCHEDULE OF INVESTMENTS (continued)
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
REVENUE -- GUAM, CONTINUED
$1,875,000 Guam Power Authority RV, Series A, AMBAC
insured, 6.30%, 10/1/12............... $ 1,991,550
-----------
2,828,790
-----------
REVENUE -- HEALTH & EDUCATION (12.4%)
25,000 Maine Educational Loan Authority,
Educational Loan RV, Supplemental
Education Loan Program, Series 92 A-1,
6.80%, 12/1/07........................ 26,036
55,000 Maine Educational Loan Authority,
Educational Loan RV, Supplemental
Education Loan Program, Series 92 A-1,
7.00%, 12/1/16........................ 57,029
15,000 Maine Educational Loan Authority,
Educational Loan RV, Supplemental
Education Loan Program, Series 92 A-2,
7.15%, 12/1/16........................ 15,569
25,000 Maine Educational Loan Marketing Corp.,
Series A, 6.35%, 5/1/05............... 25,642
45,000 Maine Educational Loan Marketing Corp.,
Student Loan Refunding RV, 6.90%,
11/1/03............................... 46,058
20,000 Maine HEHFA RV, AMBAC insured, 7.20%,
5/1/06, P/R 5/1/00 @ 102.............. 20,449
10,000 Maine HEHFA RV, AMBAC insured, 7.30%,
5/1/14, P/R 5/1/00 @ 102.............. 10,225
250,000 Maine HEHFA RV, Coves Edge Nursing Home,
10.00%, 8/1/20, P/R 8/1/00 @ 103...... 262,095
20,000 Maine HEHFA RV, FSA insured, 6.10%,
7/1/01, P/R 5/1/00 @ 102.............. 20,399
80,000 Maine HEHFA RV, FSA insured, 6.10%,
7/1/01, U/R Balance................... 81,481
10,000 Maine HEHFA RV, Kennebec Valley Medical
Center, FGIC insured, 7.00%, 7/1/05... 10,269
55,000 Maine HEHFA RV, Kennebec Valley Medical
Center, FGIC insured, 7.00%, 7/1/15... 56,482
195,000 Maine HEHFA RV, Maine Medical Center,
ETM USG, 6.00%, 10/1/13............... 206,696
50,000 Maine HEHFA RV, P/R, Series A, 6.10%,
7/1/03................................ 52,369
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
REVENUE -- HEALTH & EDUCATION, CONTINUED
$ 175,000 Maine HEHFA RV, P/R, Series A, FSA
insured, 5.50%, 7/1/07................ $ 179,085
25,000 Maine HEHFA RV, Series A, 5.25%,
7/1/11................................ 25,098
550,000 Maine HEHFA RV, Series A, FSA insured,
5.25%, 7/1/10......................... 554,075
450,000 Maine HEHFA RV, Series B, FSA insured,
5.55%, 7/1/08......................... 457,839
335,000 Maine HEHFA RV, Series B, MBIA insured,
5.00%, 7/1/10......................... 328,009
510,000 Maine HEHFA RV, Series D, FSA insured,
5.30%, 7/1/07......................... 514,406
5,000 Maine HEHFA RV, Southern Maine Medical
Center, AMBAC insured, 7.20%,
5/1/06................................ 5,111
5,000 Maine HEHFA RV, Southern Maine Medical
Center, AMBAC insured, 7.30%,
5/1/14................................ 5,110
100,000 Maine HEHFA RV, U/R Balance, Series A,
6.10%, 7/1/03......................... 103,885
840,000 Maine Veterans' Homes RV, 6.80%,
10/1/05............................... 842,855
-----------
3,906,272
-----------
REVENUE -- HOUSING (2.8%)
40,000 Maine HSG AUTH RV, Mortgage Purchase,
Series 88 D-5, 7.45%, 11/15/11........ 41,409
200,000 Maine HSG AUTH RV, Mortgage Purchase,
Series 88 D-6, 7.25%, 11/15/19........ 204,686
110,000 Maine HSG AUTH RV, Mortgage Purchase,
Series 90 A-5, Remarketed 5/13/93,
6.20%, 11/15/16....................... 110,564
185,000 Maine HSG AUTH RV, Mortgage Purchase,
Series 92 C, 6.55%, 11/15/12.......... 192,548
50,000 Maine HSG AUTH RV, Mortgage Purchase,
Series 93 A-1, 5.05%, 11/15/06........ 49,271
250,000 Maine HSG AUTH RV, Mortgage Purchase,
Series 94 C-1, 6.20%, 11/15/07........ 251,458
25,000 Maine HSG AUTH RV, Series 91 A, FSA
insured, 7.40%, 11/15/22.............. 25,738
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
14
<PAGE>
--------------------------------------------------------------------------------
MAINE MUNICIPAL BOND FUND
SCHEDULE OF INVESTMENTS (continued)
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
REVENUE -- HOUSING, CONTINUED
$ 5,000 Maine HSG AUTH RV, SFM Refunding RV,
Series 91-1, 6.90%, 11/1/07........... $ 5,119
-----------
880,793
-----------
REVENUE -- INDUSTRIAL (10.4%)
15,000 Bath, ME, Sewer Improvements RV, 7.40%,
12/1/06............................... 17,022
25,000 Bucksport, ME, Solid Waste Disposal RV,
Champion International Corp. Project,
remarketed 5/1/93, 6.25%, 5/1/10...... 25,294
530,000 East Millinocket, ME, PCR Bonds, Great
Northern Nekoosa Corp. Project, ETM
USG, 6.70%, 6/1/04.................... 551,645
165,000 Kennebec, ME, Water District RV, 7.00%,
12/1/14, P/R USG, 12/1/01 @ 101.50.... 173,785
40,000 Kennebec, ME, Water District RV, 7.00%,
12/1/20, P/R USG, 12/1/01 @ 101.50.... 42,130
500,000 Kennebec, ME, Water District RV, FSA
insured, 5.13%, 12/1/21............... 459,035
15,000 Kennebunk, ME, Sewer District RV, 7.10%,
1/1/06................................ 16,364
500,000 Maine Finance Authority RV, Boise
Cascade Corp. Project, 7.90%,
6/1/15................................ 509,640
1,450,000 Skowhegan ME, PCR Bonds, Scott Paper Co.
Project, 5.90%, 11/1/13............... 1,491,427
-----------
3,286,342
-----------
REVENUE -- OTHER (0.0%)
10,000 Maine Court Facilities Authority Lease
Rental RV, 7.15%, 8/1/07, P/R USG,
8/1/00 @ 102.......................... 10,297
-----------
REVENUE -- PUERTO RICO (17.5%)
20,000 Puerto Rico, Industrial, Medical &
Environmental RV, Abbott Chemicals,
Inc. Project, 6.50%, 7/1/09........... 20,456
300,000 Puerto Rico Infrastructure Financing
Authority, U/R Balance RV, Series A,
7.60%, 7/1/00......................... 302,379
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
REVENUE -- PUERTO RICO, CONTINUED
$1,275,000 Puerto Rico, PBA, Guaranteed Public
Education and Health Facilities RV,
Series M, FSA insured, 5.70%,
7/1/09................................ $ 1,349,537
3,855,000 Puerto Rico Public Finance Corp.,
Commonwealth Appropriations RV, Series
A, AMBAC insured, 5.38%, 6/1/18....... 3,841,430
-----------
5,513,802
-----------
REVENUE -- TRANSPORTATION (2.3%)
700,000 Maine State Turnpike Authority RV, MBIA
insured, 6.00%, 7/1/14................ 742,637
-----------
REVENUE -- VIRGIN ISLANDS (16.4%)
60,000 Virgin Islands, HSG AUTH, RV, SFM, GNMA
Mortgage-Backed, 6.00%, 3/1/07........ 59,912
1,035,000 Virgin Islands, PFA, Economic RV, ETM
COLL USG, 7.30%, 10/1/18.............. 1,236,100
1,000,000 Virgin Islands, PFA RV, Senior Lien,
Series C, 5.50%, 10/1/08.............. 990,320
515,000 Virgin Islands, PFA RV, Sub Lien Fund
Loan Notes, Series D, 6.00%,
10/1/05............................... 512,981
720,000 Virgin Islands, Water & Power Authority,
Electric System RV, 5.25% 7/1/06...... 710,712
240,000 Virgin Islands, Water & Power Authority,
Electric System RV, 5.25%, 7/1/08..... 235,032
1,500,000 Virgin Islands, Water & Power Authority,
Electric System RV, ACA-CBI & MBIA-IBC
insured, 5.30%, 7/1/21................ 1,434,840
-----------
5,179,897
-----------
Total Municipal Bonds & Notes
(cost $31,486,811) 31,474,753
-----------
SHORT-TERM HOLDINGS (0.3%)
97,683 Bankers Trust Tax-Free Money Market
Fund, 3.46%, 4/3/00 (cost $97,683).... 97,683
-----------
Total Investments (100.0%)
(cost $31,584,494) $31,572,436
===========
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
15
<PAGE>
--------------------------------------------------------------------------------
NEW HAMPSHIRE BOND FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
MUNICIPAL BONDS (98.3%)
GENERAL OBLIGATION -- BOND BANK (4.0%)
$ 5,000 New Hampshire Muni Bond Bank, Pinkerton
Academy Project, 5.25%, 6/1/07........ $ 5,048
20,000 New Hampshire Muni Bond Bank, Series 90
D, 6.90%, 7/15/03..................... 20,553
25,000 New Hampshire Muni Bond Bank, Series 91
E, 6.90%, 8/15/06..................... 26,269
25,000 New Hampshire Muni Bond Bank, Series 91
K, 6.75%, 1/15/08,
P/R USG 1/15/01 @ 102................. 25,976
10,000 New Hampshire Muni Bond Bank, Series 92
D, State Guaranteed, 6.00%, 1/15/11... 10,490
50,000 New Hampshire Muni Bond Bank, Series 92
H, 6.35%, 7/15/06..................... 52,321
175,000 New Hampshire Muni Bond Bank, Series 92
H, 6.50%, 7/15/08..................... 183,682
50,000 New Hampshire Muni Bond Bank, Series 94
A, 5.15%, 11/1/08..................... 49,843
85,000 New Hampshire Muni Bond Bank, Series 94
C, State Guaranteed, 5.80%, 8/15/08... 87,499
-----------
461,681
-----------
GENERAL OBLIGATION -- LOCAL (25.3%)
155,000 Bedford, NH, UTGO Bonds, 6.70%,
8/1/12................................ 161,913
225,000 Belknap County, NH, GO Bonds, MBIA
insured, 5.20%, 6/15/13............... 222,296
50,000 Concord, NH, GO Bonds, FGIC insured,
6.05%, 10/15/08....................... 52,498
100,000 Concord, NH, Bonds, GO Bonds, SD, 4.70%,
10/15/07.............................. 97,857
100,000 Concord, NH, Bonds, GO Bonds, SD, 5.00%,
10/15/10.............................. 98,590
100,000 Concord, NH, UTGO Bonds, MBIA insured,
5.00%, 1/15/09........................ 99,466
50,000 Exeter, NH, UTGO Bonds, 5.10%,
6/15/05............................... 50,462
25,000 Exeter, NH, UTGO Bonds, 5.30%,
6/15/08............................... 25,338
90,000 Farmington, NH, GO Bonds, SD, AMBAC
insured, 5.55%, 2/15/02............... 91,528
50,000 Franklin, NH, GO Bonds, MBIA insured,
5.20%, 10/1/07........................ 50,464
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
GENERAL OBLIGATION -- LOCAL, CONTINUED
$ 100,000 Goffstown, NH, GO Bonds, SD, AMBAC
insured, 5.25%, 8/15/11............... $ 99,951
60,000 Gorham, NH, GO Bonds, FSA insured,
4.80%, 4/1/13......................... 55,499
65,000 Gorham, NH, GO Bonds, FSA insured,
4.85%, 4/1/14......................... 59,914
45,000 Keene, NH, UTGO Bonds, 5.15%,
10/15/11.............................. 44,651
25,000 Lisbon, NH, UTGO Bonds, SD, 5.60%,
2/1/10................................ 25,389
50,000 Londonderry, NH, UTGO Bonds, 5.40%,
1/15/14............................... 49,483
225,000 Manchester, NH, UTGO Bonds, General
Improvement RV, Series B, MBIA
insured, 5.00%, 1/2/09................ 219,614
250,000 Manchester, NH, UTGO Bonds, 5.50%,
11/1/12............................... 254,333
15,000 Manchester, NH, UTGO Bonds, Series 93 A,
5.00%, 7/1/04......................... 15,127
250,000 Manchester, NH, UTGO Bonds, Public
Improvement Bonds, Series 93 A, 5.30%,
7/1/07................................ 254,156
20,000 Nashua, NH, UTGO Bonds, 5.70%,
7/15/07............................... 20,657
15,000 Nashua, NH, UTGO Bonds, 6.80%, 7/1/09... 15,719
100,000 Nashua, NH, UTGO Bonds, AMBAC insured,
5.35%, 7/15/06........................ 101,996
35,000 Nashua, NH, UTGO Bonds, FGIC insured,
5.25%, 11/2/09........................ 35,372
100,000 Nashua, NH, UTGO Bonds, Public
Improvement Bonds, 6.80%, 7/1/07...... 104,792
50,000 Oyster River, NH, GO Bonds, Cooperative
SD State Guaranteed, Lot A, 5.75%,
6/15/07............................... 51,962
100,000 Oyster River, NH, GO Bonds, Cooperative
SD State Guaranteed, Lot A, 5.85%,
6/15/08............................... 104,127
30,000 Salem, NH, GO Bonds, MBIA insured,
6.45%, 3/1/04......................... 30,994
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
16
<PAGE>
--------------------------------------------------------------------------------
NEW HAMPSHIRE BOND FUND
SCHEDULE OF INVESTMENTS (continued)
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
GENERAL OBLIGATION -- LOCAL, CONTINUED
$ 400,000 Stratham, NH, GO Bonds, SD, AMBAC
insured, 5.10%, 1/15/08............... $ 401,373
-----------
2,895,521
-----------
GENERAL OBLIGATION -- STATE (11.5%)
10,000 New Hampshire, GO Bonds, 6.00%,
9/1/05................................ 10,531
350,000 New Hampshire, GO Bonds, State Capital
Improvement, 5.50%, 12/1/06........... 360,749
1,000,000 New Hampshire, GO Bonds, State Capital
Improvement, 5.13%, 10/1/17........... 946,060
-----------
1,317,340
-----------
REVENUE -- GUAM (0.7%)
25,000 Guam Government LO Highway RV, Series 92
A, FSA insured, 5.60%, 5/1/00......... 25,032
30,000 Guam Government LO Highway RV, Series A,
FSA insured, 6.25%, 5/1/07............ 31,397
20,000 Guam Power Authority RV, Series A, AMBAC
insured, 6.30%, 10/1/12............... 21,243
-----------
77,672
-----------
REVENUE -- HEALTH & EDUCATION (26.0%)
25,000 Hudson, NH, Educational Faciities RV,
SD, Lot B, 7.30%, 12/15/06............ 28,155
20,000 Hudson, NH, Educational Facilites RV,
SD, Lot B, 7.30%, 12/15/08............ 22,976
15,000 Mascenic, NH, Regional SD #1, Lot C,
AMBAC insured, 7.20%, 12/15/07........ 17,010
50,000 New Hampshire, HEFA RV, Concord Hospital
Issue, AMBAC insured, 5.40%,
10/1/06............................... 50,807
35,000 New Hampshire, HEHFA RV, Elliot Hospital
of Manchester, 6.50%, 10/1/11......... 36,402
460,000 New Hampshire, HEHFA RV, Elliot Hospital
of Manchester, 6.25%, 10/1/21......... 465,967
100,000 New Hampshire, HEHFA RV, Exeter
Hospital, 5.25%, 10/1/00.............. 100,449
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
REVENUE -- HEALTH & EDUCATION, CONTINUED
$ 50,000 New Hampshire, HEHFA RV, Exeter
Hospital/Healthcare, 5.50%, 10/1/13... $ 50,185
165,000 New Hampshire, HEHFA RV, Franklin Pierce
College, Series 94, 5.50%, 10/1/04.... 168,655
90,000 New Hampshire, HEHFA RV, Franklin Pierce
College, Series 94, 5.50%, 10/1/04.... 88,858
90,000 New Hampshire, HEHFA RV, Franklin Pierce
College, 6.00%, 10/1/13............... 88,169
160,000 New Hampshire, HEHFA RV, Franklin Pierce
College, 6.00%, 10/1/13............... 168,333
5,000 New Hampshire, HEHFA RV, Hitchcock
Clinic Issue, MBIA insured, 6.00%,
7/1/15................................ 5,107
750,000 New Hampshire, HEHFA RV, Kendal at
Hanover Issue, Bank of Ireland, 5.80%,
10/01/12.............................. 747,428
85,000 New Hampshire, HEHFA RV, Lakes Region
Hospital Association, 5.75%, 1/1/11... 86,490
15,000 New Hampshire, HEHFA RV, Mary Hitchcock
Memorial Hospital, FGIC insured,
4.90%, 8/15/01........................ 15,058
50,000 New Hampshire, HEHFA RV, Nashua Memorial
Hospital, 5.50%, 10/1/02.............. 50,214
125,000 New Hampshire, HEHFA RV, Rivier College,
6.90%, 1/1/13......................... 133,418
400,000 New Hampshire, HEHFA RV, River Woods at
Exeter, 9.00%, 3/1/23................. 449,841
30,000 New Hampshire, HEHFA RV, University
System of New Hampshire, MBIA insured,
Series 92, 6.00%, 7/1/07.............. 31,063
175,000 New Hampshire, HEHFA RV,
Wentworth-Douglass Hospital, 5.40%,
1/1/07................................ 177,094
-----------
2,981,679
-----------
REVENUE -- HOUSING (8.9%)
10,000 New Hampshire, HSG AUTH RV, SFM,
Residential RV, 6.75%, 7/1/04......... 10,175
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
17
<PAGE>
--------------------------------------------------------------------------------
NEW HAMPSHIRE BOND FUND
SCHEDULE OF INVESTMENTS (continued)
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
REVENUE -- HOUSING, CONTINUED
$ 80,000 New Hampshire, HSG AUTH RV, SFM, Series
A, 5.25%, 1/1/07...................... $ 79,366
450,000 New Hampshire, HSG AUTH RV, SFM, Series
B, 5.6%, 1/1/06....................... 453,394
95,000 New Hampshire, HSG AUTH RV, SFM, Series
B, 5.90%, 1/1/07...................... 96,692
80,000 New Hampshire, HSG AUTH RV, SFM, Series
B, 6.00%, 1/1/08...................... 79,820
90,000 New Hampshire, HSG AUTH RV, SFM, Series
B, 6.00%, 7/1/08...................... 89,787
125,000 New Hampshire, HSG AUTH RV, SFM, Series
SB, 4.85%, 1/1/05..................... 123,113
90,000 New Hampshire, HSG AUTH RV, SFM, Series
SB, 4.95%, 1/1/06..................... 88,178
-----------
1,020,525
-----------
REVENUE -- INDUSTRIAL (1.4%)
140,000 Exeter, NH, UTGO Bonds, Sewer
Improvements, 6.25%, 1/15/07.......... 145,534
10,000 New Hampshire, IDA Solid Waste Disposal
RV, Canal Electric Co. Project, FGIC
insured, 7.38%, 12/1/20............... 10,362
-----------
155,896
-----------
REVENUE -- PUERTO RICO (2.7%)
45,000 Puerto Rico, Commonwealth, GO Bonds,
MBIA-IBC insured, 5.50%, 7/1/08....... 46,919
40,000 Puerto Rico, Commonwealth, GO Bonds,
MBIA insured, 5.75%, 7/1/10........... 42,594
80,000 Puerto Rico, Industrial Medical &
Environmental RV, Abbott Chemicals
Inc. Project, 6.50%, 7/1/09........... 81,825
25,000 Puerto Rico, Infrastructure Financing
Authority RV, U/R Balance, Series A,
7.75%, 7/1/08......................... 25,198
110,000 Puerto Rico PFA, Commonwealth
Appropriations RV, Series A, AMBAC
insured, 5.38%, 6/1/18................ 109,613
-----------
306,149
-----------
</TABLE>
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
---------- ---------------------------------------- -----------
<C> <S> <C>
REVENUE -- TRANSPORTATION (16.5%)
$ 550,000 New Hampshire State Turnpike System RV,
Series A, FGIC insured, 7.00%,
11/1/06............................... $ 598,939
1,175,000 New Hampshire State Turnpike System RV,
Series A, FGIC insured, 6.75%,
11/1/11............................... 1,293,863
-----------
1,892,802
-----------
REVENUE -- VIRGIN ISLANDS (1.3%)
10,000 Virgin Islands, HFA, SFM RV, GNMA
Mortgage-Backed, 6.00%, 3/1/07........ 9,985
30,000 Virgin Islands, PFA RV, Series B, 7.25%,
10/1/07............................... 30,795
70,000 Virgin Islands, PFA RV, Sub Lien Fund
Loan Notes, Series D, 6.00%,
10/1/05............................... 69,727
30,000 Virgin Islands, Water & Power Authority
Electric System RV, 5.25% 7/1/06...... 29,613
10,000 Virgin Islands, Water & Power Authority
Electric System RV, 5.25%, 7/1/08..... 9,793
-----------
149,913
-----------
Total Municipal Bonds
(cost $11,398,611) 11,259,178
-----------
SHORT-TERM HOLDINGS (1.7%)
200,000 New Hampshire, HEHFA, Revenue Muni
Demand Notes, FGIC insured, 3.75%,
5/16/00 (cost $200,000)++............. 200,000
-----------
Total Investments (100.0%)
(cost $11,598,611) $11,459,178
===========
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
18
<PAGE>
--------------------------------------------------------------------------------
INVESTORS GROWTH FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SECURITY
SHARES DESCRIPTION VALUE
-------------------- ---------------------------------------- -----------
<C> <S> <C>
COMMON STOCK (95.5%)
BASIC MATERIALS (3.2%)
16,000 Air Products & Chemicals, Inc........... $ 455,000
4,086 Du Pont (E.I.) de Nemours Co............ 216,047
-----------
671,047
-----------
CAPITAL GOODS (7.5%)
10,000 General Electric Co..................... 1,551,875
-----------
COMMUNICATIONS (11.4%)
15,000 AT&T Corp............................... 843,750
10,200 SBC Communications, Inc................. 428,400
20,000 Vodafone Airtouch plc ADR............... 1,111,250
-----------
2,383,400
-----------
CONSUMER CYCLICAL (2.9%)
9,352 DaimlerChrysler AG...................... 611,972
-----------
CONSUMER STAPLES (4.8%)
11,000 PepsiCo, Inc............................ 380,188
15,000 Walt Disney Co.......................... 620,625
-----------
1,000,813
-----------
ENERGY (8.9%)
8,596 Conoco, Inc. - Class B.................. 220,273
12,000 Exxon Mobil Corp........................ 933,750
9,000 Schlumberger Ltd........................ 688,500
-----------
1,842,523
-----------
FINANCIAL (24.2%)
10,000 American International Group, Inc....... 1,095,000
9,136 Bank of America Corp.................... 479,069
157 Berkshire Hathaway, Inc. -
Class B*.............................. 285,740
</TABLE>
<TABLE>
<CAPTION>
SECURITY
SHARES DESCRIPTION VALUE
-------------------- ---------------------------------------- -----------
<C> <S> <C>
FINANCIAL, CONTINUED
10,000 Fannie Mae.............................. $ 564,375
22,500 Fiserv, Inc.*........................... 836,719
10,000 Merrill Lynch Co., Inc.................. 1,050,000
18,000 Wells Fargo Co.......................... 736,875
-----------
5,047,778
-----------
HEALTH CARE (13.1%)
16,000 Abbott Laboratories..................... 563,000
14,000 American Home Products Corp............. 750,750
8,000 Johnson & Johnson....................... 560,500
13,800 Merck & Co., Inc........................ 857,325
-----------
2,731,575
-----------
TECHNOLOGY (19.5%)
8,000 Automatic Data Processing, Inc.......... 386,000
6,000 Computer Sciences Corp.*................ 474,750
7,500 IBM Corp................................ 885,000
20,000 Oracle Corp.*........................... 1,561,250
12,000 United Technologies Corp................ 758,250
-----------
4,065,250
-----------
Total Common Stock
(cost $5,015,924) 19,906,233
-----------
SHORT-TERM HOLDINGS (4.5%)
938,036 Bankers Trust Investment Money Market
Fund, 5.85%, 4/3/00 (cost $938,036)... 938,036
-----------
Total Investments (100.0%)
(cost $5,953,960) $20,844,269
===========
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
19
<PAGE>
--------------------------------------------------------------------------------
PAYSON BALANCED FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SECURITY
SHARES DESCRIPTION VALUE
-------------------- ---------------------------------------- -----------
<C> <S> <C>
COMMON STOCK (69.1%)
BASIC MATERIALS (2.3%)
7,160 Southdown, Inc.......................... $ 422,440
-----------
CAPITAL GOODS (1.7%)
9,000 Teleflex, Inc........................... 319,500
-----------
COMMUNICATIONS (5.9%)
7,000 AT&T Corp............................... 393,750
7,300 SBC Communications, Inc................. 306,600
6,060 Telefonos de Mexico SA ADR.............. 406,020
-----------
1,106,370
-----------
CONSUMER CYCLICAL (6.8%)
21,000 Banta Corp.............................. 385,875
27,000 Brunswick Corp.......................... 511,313
24,900 Fleetwood Enterprises, Inc.............. 367,275
-----------
1,264,463
-----------
CONSUMER STAPLES (5.0%)
8,000 Bestfoods, Inc.......................... 374,500
4,000 Philip Morris Cos., Inc................. 84,500
10,605 Safeway, Inc. *......................... 479,876
-----------
938,876
-----------
ENERGY (4.7%)
4,300 Chevron Corp............................ 397,481
18,200 USX-Marathon Group, Inc................. 474,338
-----------
871,819
-----------
FINANCIAL (13.2%)
14,000 Associates First Capital Corp........... 300,125
6,450 Chase Manhattan Corp.................... 562,359
9,000 Citigroup, Inc.......................... 533,813
3,400 FNMA.................................... 191,888
3,950 Merrill Lynch & Co., Inc................ 414,750
29,500 Peoples Heritage Financial Group,
Inc................................... 442,500
-----------
2,445,435
-----------
HEALTH CARE (8.3%)
13,700 Abbott Laboratories..................... 482,069
3,250 American Home Products Corp............. 174,281
900 Procter & Gamble Co..................... 50,625
9,800 Schering-Plough Corp.................... 360,150
20,350 Tenet Healthcare Corp................... 468,050
-----------
1,535,175
-----------
TECHNOLOGY (18.0%)
14,060 Compaq Computer Corp.................... 374,347
4,000 Computer Sciences Corp. *............... 316,500
4,000 IBM Corp................................ 472,000
</TABLE>
<TABLE>
<CAPTION>
SECURITY
SHARES DESCRIPTION VALUE
-------------------- ---------------------------------------- -----------
<C> <S> <C>
TECHNOLOGY, CONTINUED
3,700 Intel Corp.............................. $ 488,168
7,700 Litton Industries, Inc. *............... 340,244
1,000 Lucent Technologies, Inc................ 60,750
7,000 Northrop Grumman Corp................... 370,563
3,000 Tellabs, Inc. *......................... 188,953
7,000 United Technologies Corp................ 442,313
11,540 Xerox Corp.............................. 300,040
-----------
3,353,878
-----------
UTILITIES (3.2%)
30,300 Teco Energy, Inc........................ 588,956
-----------
Total Common Stock
(cost $11,859,801) 12,846,912
-----------
<CAPTION>
FACE
AMOUNT
--------------------
<C> <S> <C>
CORPORATE BONDS & NOTES (20.7%)
$200,000 Associates Corp. of North America,
6.10%, 1/15/05........................ 188,808
100,000 Avco Financial Services, 7.38%,
8/15/01............................... 100,119
150,000 Bear Stearns Cos., Inc., 6.63%,
1/15/04............................... 144,803
200,000 Boeing Co., 6.35%, 6/15/03.............. 193,153
200,000 Chase Manhattan Corp., 6.25%, 1/15/06... 187,669
150,000 Crown, Cork, & Seal, 6.75%, 12/15/03.... 141,491
100,000 Crown, Cork, & Seal, 6.75%, 12/15/03.... 95,143
300,000 Diageo Capital plc, 5.63%, 6/24/04...... 295,158
250,000 Dow Chemical Co., 5.97%, 1/15/09........ 228,995
300,000 Goldman Sachs Group, Inc., 6.65%,
5/15/09............................... 278,473
200,000 Ingersoll-Rand Co., 6.58%, 12/5/05...... 190,882
100,000 Lockheed Martin Corp., 6.85%, 5/15/01... 98,710
200,000 Morgan Stanley Dean Witter & Co., 5.75%,
2/15/01............................... 197,735
200,000 New York Telephone Co., 6.00%,
4/15/08............................... 182,413
177,000 Philip Morris Cos., Inc., 7.63%,
5/15/02............................... 172,923
300,000 Potomac Electric Power Co., 5.63%,
10/15/03.............................. 283,918
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
20
<PAGE>
--------------------------------------------------------------------------------
PAYSON BALANCED FUND
SCHEDULE OF INVESTMENTS (continued)
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
-------------------- ---------------------------------------- -----------
<C> <S> <C>
CORPORATE BONDS & NOTES, CONTINUED
$200,000 Sears Roebuck Acceptance Corp., 6.75%,
9/15/05............................... $ 190,509
300,000 Sony Corp., 6.13%, 3/4/03............... 292,049
200,000 Wal-Mart Stores, Inc., 6.88%, 8/10/09... 196,672
200,000 MCI WorldCom, Inc., 6.13%, 8/15/01...... 197,523
-----------
Total Corporate Bonds & Notes
(cost $4,068,042) 3,857,146
-----------
COLLATERALIZED MORTGAGE OBLIGATIONS (4.2%)
FHLMC (2.1%)
200,000 Series 1491 GB, 6.90%, 11/15/21......... 193,928
200,000 Series 1678 C, 6.00%, 8/15/08........... 192,406
-----------
386,334
-----------
FNMA (2.1%)
400,000 Series 1992-184 C, 7.00%, 10/25/21...... 385,808
-----------
Total Collateralized Mortgage Obligations
(cost $798,125) 772,142
-----------
GOVERNMENT AGENCY NOTES (1.6%)
200,000 Federal Farm Credit, 6.25%, 10/30/02.... 196,638
<CAPTION>
FACE SECURITY
AMOUNT DESCRIPTION VALUE
-------------------- ---------------------------------------- -----------
<C> <S> <C>
GOVERNMENT AGENCY NOTES, CONTINUED
$100,000 FNMA, 5.63%, 5/14/04.................... $ 94,888
-----------
Total Government Agency Notes
(cost $307,173) 291,526
-----------
MORTGAGE BACKED SECURITIES (1.8%)
GNMA (1.8%)
85,855 Pool 394795, 7.50%, 10/15/10............ 86,412
271,880 Pool 457827, 6.00%, 10/15/13............ 256,458
-----------
Total Mortgage Backed Securities
(cost $362,779) 342,870
-----------
U.S. TREASURY NOTES (1.3%)
250,000 4.25%, 11/15/03 (cost $244,844)......... 233,203
-----------
SHORT-TERM HOLDINGS (1.3%)
249,780 Bankers Trust Investment Money Market
Fund, 5.85%, 4/3/00 (cost $249,780)... 249,780
-----------
Total Investments (100.0%)
(cost $17,890,544) $18,593,579
===========
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
21
<PAGE>
--------------------------------------------------------------------------------
PAYSON VALUE FUND
SCHEDULE OF INVESTMENTS
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
SECURITY
SHARES DESCRIPTION VALUE
-------------------- ---------------------------------------- -----------
<C> <S> <C>
COMMON STOCK (97.4%)
BASIC MATERIALS (7.0%)
12,000 Air Products & Chemicals, Inc........... $ 341,250
15,000 USX-U.S. Steel Group, Inc............... 375,000
17,000 Willamette Industries, Inc.............. 682,125
-----------
1,398,375
-----------
CAPITAL GOODS (4.9%)
5,000 Cooper Cameron Corp. *.................. 334,375
7,000 Teleflex, Inc........................... 248,500
25,000 Timken Co............................... 406,250
-----------
989,125
-----------
COMMUNICATIONS (14.4%)
15,000 AT&T Corp............................... 843,750
8,000 GTE Corp................................ 568,000
10,000 MCI Worldcom, Inc. *.................... 453,125
6,000 MediaOne Group, Inc. *.................. 486,000
8,000 Telefonos de Mexico SA ADR.............. 536,000
-----------
2,886,875
-----------
CONSUMER CYCLICAL (6.0%)
3,741 DaimlerChrysler AG...................... 244,802
15,000 Nike, Inc. - Class B.................... 594,375
16,000 TJX Cos., Inc........................... 355,000
-----------
1,194,177
-----------
CONSUMER STAPLES (7.2%)
10,000 Bestfoods, Inc.......................... 468,125
30,000 Ruddick Corp............................ 328,125
5,000 Safeway, Inc. *......................... 226,250
10,000 Walt Disney Co.......................... 413,750
-----------
1,436,250
-----------
ENERGY (8.1%)
4,000 Chevron Corp............................ 369,750
10,000 ENSCO International, Inc................ 361,250
5,000 Exxon Mobil Corp........................ 389,063
11,000 Phillips Petroleum Co................... 508,750
-----------
1,628,813
-----------
</TABLE>
<TABLE>
<CAPTION>
SECURITY
SHARES DESCRIPTION VALUE
-------------------- ---------------------------------------- -----------
<C> <S> <C>
FINANCIAL (18.9%)
7,000 Chase Manhattan Corp.................... $ 610,313
15,000 Citigroup, Inc.......................... 889,687
11,844 FleetBoston Financial Corp.............. 432,306
7,000 Merrill Lynch & Co., Inc................ 735,000
15,000 North Fork Bancorp., Inc................ 268,125
20,000 Peoples Heritage Financial Group,
Inc................................... 300,000
13,330 Wells Fargo Co.......................... 545,697
-----------
3,781,128
-----------
HEALTH CARE (11.8%)
12,000 Bristol-Myers Squibb Co................. 693,000
8,000 Merck & Co., Inc........................ 497,000
5,000 Procter & Gamble Co..................... 281,250
12,000 Schering-Plough Corp.................... 441,000
20,000 Tenet Healthcare Corp................... 460,000
-----------
2,372,250
-----------
TECHNOLOGY (19.1%)
25,000 Compaq Computer Corp.................... 665,625
5,000 Hewlett-Packard Co...................... 662,813
9,000 Intel Corp.............................. 1,187,437
8,000 Litton Industries, Inc. *............... 353,500
6,000 Texas Instruments, Inc.................. 960,000
-----------
3,829,375
-----------
Total Common Stock
(cost $13,012,305) 19,516,368
-----------
SHORT-TERM HOLDINGS (2.6%)
515,073 Bankers Trust Investment Money Market
Fund, 5.85%, 4/3/00 (cost $515,073)... 515,073
-----------
Total Investments (100.0%)
(cost $13,527,378) $20,031,441
===========
</TABLE>
See Notes to Schedules of Investments and Notes to Financial Statements.
FORUM FUNDS-Registered Trademark-
22
<PAGE>
--------------------------------------------------------------------------------
NOTES TO SCHEDULES OF INVESTMENTS
--------------------------------------------------------------------------------
++ Certain variable rate securities are deemed to have a maturity remaining
until the next readjustment of the interest rate or the longer of the demand
period or readjustment. The interest rates shown reflect the rate in effect
on March 31, 2000.
+ Securities that may be resold to "qualified institutional buyers" under the
rule 144A or securities offered pursuant to 4(2) of the Securities Act of
1933, as amended.
* Non-income producing securities.
<TABLE>
<S> <C>
ACA American Capital Assets
ADR American Depositary Receipts
AMBAC American Municipal Bond Assurance Corporation
CBI Certificate of Bond Insurance
COLL Collateralized
ETM Escrowed to Maturity
FGIC Financial Guaranty Insurance Company
FHA Federal Housing Authority
FHLMC Federal Home Loan Mortgage Corporation
FNMA Federal National Mortgage Association
FSA Financial Security Assurance, Inc.
GNMA Government National Mortgage Association
GO General Obligation
HEFA Higher Education Facilities Authority
HEHFA Higher Education & Health Facilities Authority
HFA Housing Finance Authority
HSG AUTH State Housing Authority
IBC Insured Bond Certification
IDA Industrial Development Authority
LO Limited Obligation
LOC Letter of Credit
LTGO Limited Tax General Obligation
MBIA Municipal Bond Insurance Association
Muni Municipal
P/R Prerefunded
PBA Public Building Authority
PCR Pollution Control Revenue
PFA Public Finance Authority
RV Revenue Bonds
RTC Resolution Trust Company
SD School District
SFM Single Family Mortgage
SRF State Revolving Loan Fund
U/R Unrefunded
USG U.S. Governments
UTGO Unlimited Tax General Obligation
</TABLE>
See Notes to Financial Statements. 23
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MAINE
INVESTORS INVESTORS TAXSAVER MUNICIPAL
HIGH GRADE BOND BOND BOND
BOND FUND FUND FUND FUND
--------- ---- ---- ----
<S> <C> <C> <C> <C>
ASSETS
Investments (Note 2):
Investments, at cost......... $29,122,907 $53,692,402 $28,625,633 $31,584,494
Net unrealized appreciation
(depreciation).............. (1,174,933) (3,601,073) (535,310) (12,058)
----------- ----------- ----------- -----------
Total investments, at value.... 27,947,974 50,091,329 28,090,323 31,572,436
Interest, dividends and other
receivables................... 474,926 656,373 514,873 640,752
Receivable for securities
sold.......................... -- -- 700,558 --
Receivable for fund shares
sold.......................... 10,591 2,474 -- --
Prepaid assets................. 665 1,258 660 655
Organization costs, net of
amortization (Note 2)......... 3,056 -- -- --
----------- ----------- ----------- -----------
Total Assets....................... 28,437,212 50,751,434 29,306,414 32,213,843
----------- ----------- ----------- -----------
LIABILITIES
Dividends payable.............. 139,834 248,653 88,007 48,959
Payable for fund shares
redeemed...................... 14,523 55 -- 179,555
Payable to administrator (Note
3)............................ 2,018 6,294 1,446 5,955
Payable to adviser (Note 3).... 4,843 12,637 -- --
Accrued expenses and other
liabilities................... 41,930 52,018 36,534 41,421
----------- ----------- ----------- -----------
Total Liabilities.................. 203,148 319,657 125,987 275,890
----------- ----------- ----------- -----------
NET ASSETS......................... $28,234,064 $50,431,777 $29,180,427 $31,937,953
=========== =========== =========== ===========
COMPONENTS OF NET ASSETS
Paid-in capital................ $29,709,620 $54,735,406 $30,016,501 $32,068,492
Undistributed (distributions in
excess of) net investment
income........................ (27) -- 8,267 (15)
Unrealized appreciation
(depreciation) on
investments................... (1,174,933) (3,601,073) (535,310) (12,058)
Accumulated net realized gain
(loss)........................ (300,596) (702,556) (309,031) (118,466)
----------- ----------- ----------- -----------
NET ASSETS......................... $28,234,064 $50,431,777 $29,180,427 $31,937,953
=========== =========== =========== ===========
SHARES OF BENEFICIAL INTEREST...... 2,984,835 5,180,202 2,902,211 3,006,812
=========== =========== =========== ===========
NET ASSET VALUE, AND REDEMPTION
PRICE PER SHARE................... $ 9.46 $ 9.74 $ 10.05 $ 10.62
=========== =========== =========== ===========
OFFERING PRICE PER SHARE
(NAV DIVIDED BY (1 - MAXIMUM
SALES LOAD))...................... $ 9.83 $ 10.12 $ 10.44 $ 10.95
=========== =========== =========== ===========
MAXIMUM SALES LOAD................. 3.75% 3.75% 3.75% 3.00%
=========== =========== =========== ===========
</TABLE>
See Notes to Financial Statements. 24
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF ASSETS AND LIABILITIES (CONTINUED)
MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NEW
HAMPSHIRE INVESTORS PAYSON PAYSON
BOND GROWTH BALANCED VALUE
FUND FUND FUND FUND
---- ---- ---- ----
<S> <C> <C> <C> <C>
ASSETS
Investments (Note 2):
Investments, at cost......... $11,598,611 $ 5,953,960 $17,890,544 $13,527,378
Net unrealized appreciation
(depreciation).............. (139,433) 14,890,309 703,035 6,504,063
----------- ----------- ----------- -----------
Total investments, at value.... 11,459,178 20,844,269 18,593,579 20,031,441
Cash........................... 3,452 -- -- --
Interest, dividends and other
receivables................... 223,593 18,655 95,544 25,289
Receivable for securities
sold.......................... -- -- 463,162 --
Receivable for fund shares
sold.......................... -- -- -- --
Prepaid assets................. 308 512 430 408
Organization costs, net of
amortization (Note 2)......... -- 8,263 -- --
----------- ----------- ----------- -----------
Total Assets....................... 11,686,531 20,871,699 19,152,715 20,057,138
----------- ----------- ----------- -----------
LIABILITIES
Dividends payable.............. 14,567 4,193 50,208 279
Payable for fund shares
redeemed...................... -- -- 11,528 18,211
Payable for securities
purchased..................... -- -- 447,910 --
Payable to administrator (Note
3)............................ -- -- 4,105 5,810
Payable to adviser (Note 3).... -- -- 5,009 9,136
Accrued expenses and other
liabilities................... 27,506 44,662 37,731 36,250
----------- ----------- ----------- -----------
Total Liabilities.................. 42,073 48,855 556,491 69,686
----------- ----------- ----------- -----------
NET ASSETS......................... $11,644,458 $20,822,844 $18,596,224 $19,987,452
=========== =========== =========== ===========
COMPONENTS OF NET ASSETS
Paid-in capital................ $11,882,875 $ 3,204,773 $18,062,070 $12,107,659
Undistributed (distributions in
excess of) net investment
income........................ 489 940 (31,502) (54)
Unrealized appreciation
(depreciation) on
investments................... (139,433) 14,890,309 703,035 6,504,063
Accumulated net realized gain
(loss)........................ (99,473) 2,726,822 (137,379) 1,375,784
----------- ----------- ----------- -----------
NET ASSETS......................... $11,644,458 $20,822,844 $18,596,224 $19,987,452
=========== =========== =========== ===========
SHARES OF BENEFICIAL INTEREST...... 1,127,452 1,800,028 1,497,205 914,296
=========== =========== =========== ===========
NET ASSET VALUE, AND REDEMPTION
PRICE PER SHARE................... $ 10.33 $ 11.57 $ 12.42 $ 21.86
=========== =========== =========== ===========
OFFERING PRICE PER SHARE
(NAV DIVIDED BY (1 - MAXIMUM
SALES LOAD))...................... $ 10.65 $ 12.05 $ 12.94 $ 22.77
=========== =========== =========== ===========
MAXIMUM SALES LOAD................. 3.00% 4.00% 4.00% 4.00%
=========== =========== =========== ===========
</TABLE>
See Notes to Financial Statements. 25
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INVESTORS MAINE
HIGH GRADE INVESTORS TAXSAVER MUNICIPAL
BOND BOND BOND BOND
FUND FUND FUND FUND
---- ---- ---- ----
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest income...... $2,127,096 $4,407,479 $ 1,728,220 $ 1,658,522
Dividend income...... -- 243,735 -- --
----------- ----------- ----------- -----------
Total Investment
Income................. 2,127,096 4,651,214 1,728,220 1,658,522
----------- ----------- ----------- -----------
EXPENSES
Investment advisory
(Note 3)............ 132,059 244,646 130,990 129,914
Administrator (Note
3).................. 66,029 122,323 65,495 64,957
Transfer agency (Note
3).................. 94,997 166,468 94,872 107,465
Custody.............. 8,591 12,323 8,824 10,114
Accounting (Note
3).................. 38,200 38,200 38,200 50,200
Audit................ 14,900 18,000 16,000 15,500
Legal................ 3,443 6,928 3,426 9,527
Filing............... 2,293 3,484 3,048 4,561
Trustees............. 2,616 4,957 2,618 2,485
Amortization of
organization costs
(Note 2)............ 1,031 -- -- --
Pricing.............. 2,555 4,500 4,846 15,134
Reporting............ 4,987 12,266 6,938 8,443
Miscellaneous........ 4,983 7,889 4,498 7,779
----------- ----------- ----------- -----------
Total Expenses........... 376,684 641,984 379,755 426,079
Fees waived (Note
4).................. (144,909) (212,582) (182,705) (230,659)
----------- ----------- ----------- -----------
Net Expenses............. 231,775 429,402 197,050 195,420
----------- ----------- ----------- -----------
NET INVESTMENT INCOME.... 1,895,321 4,221,812 1,531,170 1,463,102
----------- ----------- ----------- -----------
NET REALIZED AND
UNREALIZED GAIN (LOSS)
ON INVESTMENTS:
Net realized loss on
investments......... (300,596) (702,555) (309,031) (117,360)
Net change in
unrealized
depreciation on
investments......... (1,314,931) (3,147,442) (1,523,558) (1,219,370)
----------- ----------- ----------- -----------
NET REALIZED AND
UNREALIZED GAIN (LOSS)
ON INVESTMENTS......... (1,615,527) (3,849,997) (1,832,589) (1,336,730)
----------- ----------- ----------- -----------
NET INCREASE (DECREASE)
IN NET ASSETS RESULTING
FROM OPERATIONS........ $ 279,794 $ 371,815 $ (301,419) $ 126,372
=========== =========== =========== ===========
</TABLE>
See Notes to Financial Statements. 26
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF OPERATIONS (CONTINUED)
FOR THE YEAR ENDED MARCH 31, 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NEW
HAMPSHIRE INVESTORS PAYSON PAYSON
BOND GROWTH BALANCED VALUE
FUND FUND FUND FUND
---- ---- ---- ----
<S> <C> <C> <C> <C>
INVESTMENT INCOME
Interest income........... $ 737,990 $ 43,938 $411,482 $ 26,064
Dividend income........... -- 333,345 284,401 300,057
--------- ----------- -------- ----------
Total Investment Income....... 737,990 377,283 695,883 326,121
--------- ----------- -------- ----------
EXPENSES
Investment advisory (Note
3)....................... 58,328 163,737 130,187 156,197
Administrator (Note 3).... 29,165 50,381 43,396 39,049
Transfer agency (note
3)....................... 52,613 75,356 72,529 68,204
Custody................... 6,463 7,506 9,118 7,020
Accounting (Note 3)....... 38,200 38,200 39,200 38,200
Audit..................... 14,500 15,000 12,400 12,400
Legal..................... 5,135 3,368 2,267 1,919
Filing.................... 4,171 2,325 7,443 5,770
Trustees.................. 1,150 2,082 1,721 1,482
Amortization of
organization costs (Note
2)....................... -- 3,035 -- --
Pricing................... 9,305 2,022 3,881 2,113
Reporting................. 9,208 8,274 4,278 4,817
Miscellaneous............. 3,161 3,171 3,840 4,032
--------- ----------- -------- ----------
Total Expenses................ 231,399 374,457 330,260 341,203
Fees waived (Note 4)...... (143,659) (96,714) (80,102) (57,561)
--------- ----------- -------- ----------
Net Expenses.................. 87,740 277,743 250,158 283,642
--------- ----------- -------- ----------
NET INVESTMENT INCOME......... 650,250 99,540 445,725 42,479
--------- ----------- -------- ----------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss)
on investments........... (94,841) 3,086,739 (32,807) 1,413,947
Net change in unrealized
appreciation
(depreciation) on
investments.............. (607,259) (1,805,745) 447,875 1,573,965
--------- ----------- -------- ----------
NET REALIZED AND UNREALIZED
GAIN (LOSS) ON INVESTMENTS.. (702,100) 1,280,994 415,068 2,987,912
--------- ----------- -------- ----------
NET INCREASE (DECREASE) IN NET
ASSETS RESULTING FROM
OPERATIONS.................. $ (51,850) $ 1,380,534 $860,793 $3,030,391
========= =========== ======== ==========
</TABLE>
See Notes to Financial Statements. 27
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED MARCH 31, 1999 AND 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
INVESTORS HIGH INVESTORS BOND TAXSAVER BOND
GRADE BOND FUND FUND FUND
----------------------- ------------------------- -----------------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
NET ASSETS--MARCH 31, 1998........................ $34,036,897 $85,598,031 $39,203,307
-------------------------- ----------- ----------- -----------
OPERATIONS
Net investment income........................... 1,994,678 5,188,728 1,766,191
Net realized gain on investments................ 435,100 432,794 344,151
Net change in unrealized depreciation on
investments.................................... (355,589) (1,925,913) (212,501)
----------- ----------- -----------
Net increase in net assets resulting from
operations...................................... 2,074,189 3,695,609 1,897,841
----------- ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income........................... (1,994,678) (5,188,728) (1,766,191)
Net realized gain on investments................ (241,976) (345,772) (670,152)
----------- ----------- -----------
Total distributions to shareholders............... (2,236,654) (5,534,500) (2,436,343)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS
Sale of shares.................................. 4,773,805 474,584 10,233,451 968,455 6,929,842 643,641
Reinvestment of distributions................... 7,098 705 1,009,827 95,802 955,881 88,946
Redemption of shares............................ (2,901,626) (288,074) (24,556,881) (2,334,616) (9,103,349) (847,842)
----------- -------- ----------- ---------- ----------- --------
Net increase (decrease) in capital transactions... 1,879,277 187,215 (13,313,603) (1,270,359) (1,217,626) (115,255)
----------- ======== ----------- ========== ----------- ========
Net increase (decrease) in net assets............. 1,716,812 (15,152,494) (1,756,128)
----------- ----------- -----------
NET ASSETS--MARCH 31, 1999
--------------------------
(Including line (a))............................ 35,753,709 70,445,537 37,447,179
----------- ----------- -----------
OPERATIONS
Net investment income........................... 1,895,321 4,221,812 1,531,170
Net realized loss on investments................ (300,596) (702,555) (309,031)
Net change in unrealized depreciation on
investments.................................... (1,314,931) (3,147,442) (1,523,558)
----------- ----------- -----------
Net increase (decrease) in net assets resulting
from operations................................. 279,794 371,815 (301,419)
----------- ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income........................... (1,895,321) (4,221,812) (1,531,170)
In excess of net investment income.............. (27) -- --
Net realized gain on investments................ (106,552) -- --
----------- ----------- -----------
Total distribution to shareholders................ (2,001,900) (4,221,812) (1,531,170)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS
Sale of shares.................................. 1,907,929 198,970 5,765,203 577,148 2,798,493 273,055
Reinvestment of distributions................... 126,642 13,422 616,156 62,388 448,541 44,049
Redemption of shares............................ (7,832,110) (830,502) (22,545,122) (2,286,593) (9,681,197) (944,871)
----------- -------- ----------- ---------- ----------- --------
Net decrease in capital transactions.............. (5,797,539) (618,110) (16,163,763) (1,647,057) (6,434,163) (627,767)
----------- ======== ----------- ========== ----------- ========
Net decrease in net assets........................ (7,519,645) (20,013,760) (8,266,752)
----------- ----------- -----------
NET ASSETS--MARCH 31, 2000
--------------------------
(Including line (b))............................ $28,234,064 $50,431,777 $29,180,427
=========== =========== ===========
(a) Accumulated undistributed net investment
income March 31, 1999....................... $ -- $ -- $ 8,267
=========== =========== ===========
(b) Accumulated undistributed (distributions in
excess of) net investment income, March 31,
2000........................................ $ (27) $ -- $ 8,267
=========== =========== ===========
</TABLE>
See Notes to Financial Statements. 28
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
FOR THE YEARS ENDED MARCH 31, 1999 AND 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MAINE MUNICIPAL NEW HAMPSHIRE INVESTORS
BOND FUND BOND FUND GROWTH FUND
----------------------- ----------------------- -----------------------
AMOUNT SHARES AMOUNT SHARES AMOUNT SHARES
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
NET ASSETS--MARCH 31, 1998.......................... $28,196,053 $12,907,927 $33,898,938
-------------------------- ----------- ----------- -----------
OPERATIONS
Net investment income............................. 1,324,765 609,591 162,580
Net realized gain on investments.................. 131,277 66,571 2,117,054
Net change in unrealized appreciation
(depreciation) on investments.................... 43,413 78,878 (611,134)
----------- ----------- -----------
Net increase in net assets resulting from
operations........................................ 1,499,455 755,040 1,668,500
----------- ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income............................. (1,324,765) (609,591) (250,935)
Net realized gain on investments.................. (139,593) (80,795) (958,130)
----------- ----------- -----------
Total distributions to shareholders................. (1,464,358) (690,386) (1,209,065)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS
Sale of shares.................................... 8,330,979 749,695 3,245,202 299,466 3,186,657 288,754
Reinvestment of distributions..................... 1,110,210 99,752 655,830 60,443 957,833 90,618
Redemption of shares.............................. (5,013,093) (451,679) (1,646,399) (151,894) (9,396,270) (857,993)
----------- -------- ----------- -------- ----------- --------
Net increase (decrease) in capital transactions..... 4,428,096 397,768 2,254,633 208,015 (5,251,780) (478,621)
----------- ======== ----------- ======== ----------- ========
Net increase (decrease) in net assets............... 4,463,193 2,319,287 (4,792,345)
----------- ----------- -----------
NET ASSETS--MARCH 31, 1999
--------------------------
(Including line (a)).............................. 32,659,246 15,227,214 29,106,593
----------- ----------- -----------
OPERATIONS
Net investment income............................. 1,463,102 650,250 99,540
Net realized gain (loss) on investments........... (117,360) (94,841) 3,086,739
Net change in unrealized depreciation on
investments...................................... (1,219,370) (607,259) (1,805,745)
----------- ----------- -----------
Net increase (decrease) in net assets resulting from
operations........................................ 126,372 (51,850) 1,380,534
----------- ----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income............................. (1,463,102) (650,250) (98,707)
In excess of net investment income................ (15) -- --
Net realized gain on investments.................. (21,390) -- (1,518,841)
In excess of gain on investments.................. (1,121) (2,495) --
----------- ----------- -----------
Total distribution to shareholders.................. (1,485,628) (652,745) (1,617,548)
----------- ----------- -----------
CAPITAL SHARE TRANSACTIONS
Sale of shares.................................... 6,499,166 589,162 2,026,085 193,804 92,402 8,052
Reinvestment of distributions..................... 904,112 84,641 468,920 45,012 1,512,596 138,136
Redemption of shares.............................. (6,765,315) (617,405) (5,373,166) (521,842) (9,651,733) (854,576)
----------- -------- ----------- -------- ----------- --------
Net increase (decrease) in capital transactions..... 637,963 56,398 (2,878,161) (283,026) (8,046,735) (708,388)
----------- ======== ----------- ======== ----------- ========
Net decrease in net assets.......................... (721,293) (3,582,756) (8,283,749)
----------- ----------- -----------
NET ASSETS--MARCH 31, 2000
--------------------------
(Including line (b)).............................. $31,937,953 $11,644,458 $20,822,844
=========== =========== ===========
(a) Accumulated undistributed net investment
income March 31, 1999.......................... $ -- $ 489 $ 107
=========== =========== ===========
(b) Accumulated undistributed (distributions in
excess of) net investment income, March 31,
2000........................................... $ (15) $ 489 $ 940
=========== =========== ===========
</TABLE>
See Notes to Financial Statements. 29
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS (CONTINUED)
FOR THE YEARS ENDED MARCH 31, 1999 AND 2000
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAYSON BALANCED PAYSON VALUE
FUND FUND
----------------------- -----------------------
AMOUNT SHARES AMOUNT SHARES
------ ------ ------ ------
<S> <C> <C> <C> <C>
NET ASSETS--MARCH 31, 1998.................................. $24,439,835 $19,918,357
-------------------------- ----------- -------- --------
OPERATIONS
Net investment income..................................... 483,773 64,364
Net realized gain on investments.......................... 518,177 781,466
Net change in unrealized depreciation on investments...... (2,942,947) (1,860,529)
----------- -----------
Net decrease in net assets resulting from operations........ (1,940,997) (1,014,699)
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income..................................... (479,543) (48,604)
Net realized gain on investments.......................... (1,489,464) (1,152,328)
----------- -----------
Total distributions to shareholders......................... (1,969,007) (1,200,932)
----------- -----------
CAPITAL SHARE TRANSACTIONS
Sale of shares............................................ 4,382,937 336,775 3,053,741 155,011
Reinvestment of distributions............................. 1,354,224 109,002 721,359 40,271
Redemption of shares...................................... (3,077,919) (241,118) (3,224,470) (168,743)
----------- -------- ----------- --------
Net increase in capital transactions........................ 2,659,242 204,659 550,630 26,539
----------- ======== ----------- ========
Net decrease in net assets.................................. (1,250,762) (1,665,001)
----------- -----------
NET ASSETS--MARCH 31, 1999
--------------------------
(Including line (a))...................................... 23,189,073 18,253,356
----------- -----------
OPERATIONS
Net investment income..................................... 445,725 42,479
Net realized gain (loss) on investments................... (32,807) 1,413,947
Net change in unrealized appreciation on investments...... 447,875 1,573,965
----------- -----------
Net increase in net assets resulting from operations........ 860,793 3,030,391
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM
Net investment income..................................... (445,725) (42,479)
In excess of net investment income........................ (31,081) (54)
Net realized gain on investments.......................... (416,450) (611,758)
In excess of gain on investments.......................... (104,993) --
----------- -----------
Total distribution to shareholders.......................... (998,249) (654,291)
----------- -----------
CAPITAL SHARE TRANSACTIONS
Sale of shares............................................ 688,127 54,532 1,916,172 94,055
Reinvestment of distributions............................. 688,608 56,763 402,187 20,141
Redemption of shares...................................... (5,832,128) (471,568) (2,960,363) (145,485)
----------- -------- ----------- --------
Net decrease in capital transactions........................ (4,455,393) (360,273) (642,004) (31,289)
----------- ======== ----------- ========
Net increase (decrease) in net assets....................... (4,592,849) 1,734,096
----------- -----------
NET ASSETS--MARCH 31, 2000
--------------------------
(Including line (b))...................................... $18,596,224 $19,987,452
=========== ===========
(a) Accumulated undistributed net investment income, March
31, 1999............................................... $ -- $ --
=========== ===========
(b) Accumulated distributions in excess of net investment
income, March 31, 2000................................. $ (31,502) $ (54)
=========== ===========
</TABLE>
See Notes to Financial Statements. 30
FORUM FUNDS-Registered Trademark-
<PAGE>
(This page has been left blank intentionally.)
31 FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
Selected per share data and ratios for a share outstanding throughout each
period.
<TABLE>
<CAPTION>
NET REALIZED ENDING
BEGINNING AND DIVIDENDS DISTRIBUTIONS NET
NET ASSET NET UNREALIZED FROM NET FROM NET ASSET
VALUE PER INVESTMENT GAIN (LOSS) ON INVESTMENT INVESTMENT VALUE PER
SHARE INCOME INVESTMENTS INCOME GAINS SHARE
----- ------ ----------- ------ ----- -----
<S> <C> <C> <C> <C> <C> <C>
INVESTORS HIGH GRADE BOND FUND
---------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... $ 9.92 $0.55 $(0.43) $(0.55) $(0.03) $ 9.46
April 1, 1998 to March 31, 1999......... 9.96 0.57 0.03 (0.57) (0.07) 9.92
March 16, 1998(a) to March 31, 1998..... 10.00 0.02 (0.04) (0.02) -- 9.96
INVESTORS BOND FUND
---------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 10.32 0.68 (0.58) (0.68) -- 9.74
April 1, 1998 to March 31, 1999......... 10.57 0.67 (0.21) (0.67) (0.04) 10.32
April 1, 1997 to March 31, 1998......... 10.19 0.71 0.38 (0.71) -- 10.57
April 1, 1996 to March 31, 1997......... 10.21 0.71 -- (0.71) (0.02) 10.19
April 1, 1995 to March 31, 1996......... 10.00 0.74 0.21 (0.74) -- 10.21
TAXSAVER BOND FUND
---------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 10.61 0.48 (0.56) (0.48) -- 10.05
April 1, 1998 to March 31, 1999......... 10.75 0.48 0.04 (0.48) (0.18) 10.61
April 1, 1997 to March 31, 1998......... 10.49 0.53 0.27 (0.53) (0.01) 10.75
April 1, 1996 to March 31, 1997......... 10.57 0.56 (0.03) (0.56) (0.05) 10.49
April 1, 1995 to March 31, 1996......... 10.39 0.57 0.18 (0.57) -- 10.57
MAINE MUNICIPAL BOND FUND
---------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 11.07 0.48 (0.44) (0.48) (0.01) 10.62
April 1, 1998 to March 31, 1999......... 11.05 0.49 0.07 (0.49) (0.05) 11.07
April 1, 1997 to March 31, 1998......... 10.73 0.51 0.33 (0.51) (0.01) 11.05
April 1, 1996 to March 31, 1997......... 10.72 0.51 0.01 (0.51) -- 10.73
April 1, 1995 to March 31, 1996......... 10.47 0.51 0.25 (0.51) -- 10.72
(a) Commencement of operations.
(b) Total return calculations do not include sales charges.
(c) Annualized.
(d) The ratio of Gross Expenses to Average Net Assets reflects the expense ratio excluding any waivers and/or
reimbursements (Note 4).
</TABLE>
See Notes to Financial Statements. 32
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS
NET ASSETS AT ------------------------------------- PORTFOLIO
TOTAL END OF PERIOD NET INVESTMENT NET GROSS TURNOVER
RETURN(B) (000'S OMITTED) INCOME EXPENSES EXPENSES(D) RATE
--------- --------------- ------ -------- ----------- ----
<S> <C> <C> <C> <C> <C> <C>
INVESTORS HIGH GRADE BOND FUND
----------------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 1.35% $ 28,234 5.74% 0.70% 1.14% 13%
April 1, 1998 to March 31, 1999......... 6.12% 35,754 5.68% 0.70% 1.12% 173%
March 16, 1998(a) to March 31, 1998..... (0.16%) 34,037 5.56%(c) 0.70%(c) 3.00%(c) 0%
INVESTORS BOND FUND
----------------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 1.13% 50,432 6.90% 0.70% 1.05% 34%
April 1, 1998 to March 31, 1999......... 4.45% 70,446 6.33% 0.70% 1.02% 98%
April 1, 1997 to March 31, 1998......... 10.98% 85,598 6.52% 0.70% 1.22% 117%
April 1, 1996 to March 31, 1997......... 7.18% 22,190 6.94% 0.70% 1.45% 79%
April 1, 1995 to March 31, 1996......... 9.84% 25,676 7.29% 0.43% 1.36% 43%
TAXSAVER BOND FUND
----------------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... (0.74%) 29,180 4.68% 0.60% 1.16% 25%
April 1, 1998 to March 31, 1999......... 4.95% 37,447 4.48% 0.60% 1.11% 62%
April 1, 1997 to March 31, 1998......... 7.75% 39,203 4.95% 0.60% 1.36% 93%
April 1, 1996 to March 31, 1997......... 5.15% 17,757 5.28% 0.60% 1.53% 34%
April 1, 1995 to March 31, 1996......... 7.36% 17,915 5.35% 0.60% 1.48% 62%
MAINE MUNICIPAL BOND FUND
----------------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 0.43% 31,938 4.50% 0.60% 1.31% 23%
April 1, 1998 to March 31, 1999......... 5.19% 32,659 4.42% 0.60% 1.32% 29%
April 1, 1997 to March 31, 1998......... 7.94% 28,196 4.65% 0.60% 1.48% 16%
April 1, 1996 to March 31, 1997......... 4.98% 25,827 4.77% 0.60% 1.56% 21%
April 1, 1995 to March 31, 1996......... 7.34% 26,044 4.73% 0.60% 1.48% 34%
</TABLE>
See Notes to Financial Statements. 33
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS (CONTINUED)
--------------------------------------------------------------------------------
Selected per share data and ratios for a share outstanding throughout each
period.
<TABLE>
<CAPTION>
NET REALIZED ENDING
BEGINNING AND DIVIDENDS DISTRIBUTIONS NET
NET ASSET NET UNREALIZED FROM NET FROM NET ASSET
VALUE PER INVESTMENT GAIN (LOSS) ON INVESTMENT INVESTMENT VALUE PER
SHARE INCOME INVESTMENTS INCOME GAINS SHARE
----- ------ ----------- ------ ----- -----
<S> <C> <C> <C> <C> <C> <C>
NEW HAMPSHIRE BOND FUND
---------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... $10.80 $0.47 $(0.47) $(0.47) $ -- (e) $10.33
April 1, 1998 to March 31, 1999......... 10.73 0.46 0.13 (0.46) (0.06) 10.80
April 1, 1997 to March 31, 1998......... 10.31 0.47 0.43 (0.48) -- 10.73
April 1, 1996 to March 31, 1997......... 10.33 0.48 (0.02) (0.48) -- 10.31
April 1, 1995 to March 31, 1996......... 10.08 0.48 0.25 (0.48) -- 10.33
INVESTORS GROWTH FUND
---------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 11.60 0.04 0.67 (0.04) (0.70) 11.57
April 1, 1998 to March 31, 1999......... 11.35 0.06 0.61 (0.09) (0.33) 11.60
December 12, 1997(a) to March 31,
1998................................... 10.00 0.03 1.32 -- -- 11.35
PAYSON BALANCED FUND
---------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 12.48 0.27 0.27 (0.27) (0.33) 12.42
April 1, 1998 to March 31, 1999......... 14.79 0.28 (1.51) (0.28) (0.80) 12.48
April 1, 1997 to March 31, 1998......... 13.20 0.37 3.52 (0.37) (1.93) 14.79
April 1, 1996 to March 31, 1997......... 13.70 0.42 0.84 (0.42) (1.34) 13.20
April 1, 1995 to March 31, 1996......... 11.90 0.43 2.12 (0.43) (0.32) 13.70
PAYSON VALUE FUND
---------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 19.30 0.06 3.19 (0.06) (0.63) 21.86
April 1, 1998 to March 31, 1999......... 21.67 0.07 (1.16) (0.07) (1.21) 19.30
April 1, 1997 to March 31, 1998......... 16.10 0.12 6.93 (0.12) (1.36) 21.67
April 1, 1996 to March 31, 1997......... 15.99 0.21 1.80 (0.20) (1.70) 16.10
April 1, 1995 to March 31, 1996......... 12.71 0.21 3.29 (0.21) (0.01) 15.99
(a) Commencement of operations.
(b) Total return calculations do not include sales charges.
(c) Annualized.
(d) The ratio of Gross Expenses to Average Net Assets reflects the expense ratio excluding any waivers and/or
reimbursements (Note 4).
(e) Less than $0.01 per share.
</TABLE>
See Notes to Financial Statements. 34
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
RATIOS TO AVERAGE NET ASSETS
NET ASSETS AT ------------------------------------- PORTFOLIO
TOTAL END OF PERIOD NET INVESTMENT NET GROSS TURNOVER
RETURN(B) (000'S OMITTED) INCOME EXPENSES EXPENSES(D) RATE
--------- --------------- ------ -------- ----------- ----
<S> <C> <C> <C> <C> <C> <C>
NEW HAMPSHIRE BOND FUND
----------------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... $0.03% $ 11,644 4.46% 0.60% 1.59% 19%
April 1, 1998 to March 31, 1999......... 5.61% 15,227 4.28% 0.60% 1.53% 42%
April 1, 1997 to March 31, 1998......... 8.84% 12,908 4.45% 0.60% 1.81% 23%
April 1, 1996 to March 31, 1997......... 4.56% 8,691 4.65% 0.60% 2.22% 53%
April 1, 1995 to March 31, 1996......... 7.36% 6,903 4.65% 0.60% 2.26% 34%
INVESTORS GROWTH FUND
----------------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 6.54% 20,823 0.40% 1.10% 1.49% 0%
April 1, 1998 to March 31, 1999......... 6.25% 29,107 0.51% 1.10% 1.44% 27%
December 12, 1997(a) to March 31,
1998.................................... 13.50% 33,899 0.96%(c) 1.10%(c) 1.56%(c) 0%
PAYSON BALANCED FUND
----------------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 4.53% 18,596 2.05% 1.15% 1.52% 54%
April 1, 1998 to March 31, 1999......... (8.20%) 23,189 2.07% 1.15% 1.49% 100%
April 1, 1997 to March 31, 1998......... 31.27% 24,440 2.58% 1.15% 1.57% 66%
April 1, 1996 to March 31, 1997......... 9.42% 18,163 3.07% 1.15% 1.67% 53%
April 1, 1995 to March 31, 1996......... 21.70% 17,455 3.25% 1.15% 1.70% 62%
PAYSON VALUE FUND
----------------------------------------------------------------------------------------------------------------------
April 1, 1999 to March 31, 2000......... 17.20% 19,987 0.22% 1.45% 1.75% 20%
April 1, 1998 to March 31, 1999......... (4.57%) 18,253 0.35% 1.45% 1.75% 41%
April 1, 1997 to March 31, 1998......... 45.28% 19,918 0.62% 1.45% 1.87% 39%
April 1, 1996 to March 31, 1997......... 13.01% 13,109 1.30% 1.45% 2.07% 24%
April 1, 1995 to March 31, 1996......... 27.77% 10,319 1.47% 1.45% 2.16% 53%
</TABLE>
See Notes to Financial Statements. 35
FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
MARCH 31, 2000
--------------------------------------------------------------------------------
NOTE 1. ORGANIZATION
Forum Funds-Registered Trademark- (the "Trust") is a Delaware business trust
that is registered as an open-end, management investment company under the
Investment Company Act of 1940, as amended (the "Act"). The Trust currently has
nineteen active investment portfolios. Included in this report are Investors
High Grade Bond Fund, Investors Bond Fund, TaxSaver Bond Fund, Maine Municipal
Bond Fund, New Hampshire Bond Fund, Investors Growth Fund, Payson Balanced Fund
and Payson Value Fund (individually, a "Fund" and, collectively, the "Funds").
Each of Investors High Grade Bond Fund, Investors Growth Fund, Payson Balanced
Fund and Payson Value Fund is a diversified series of the trust. All other funds
included in the report are non-diversified. Under its Trust Instrument, the
Trust is authorized to issue an unlimited number of each Fund's shares of
beneficial interest without par value. Each Fund commenced operations on the
dates indicated as follows:
<TABLE>
<S> <C>
Investors High Grade Bond Fund March 16, 1998
Investors Bond Fund October 2, 1989
TaxSaver Bond Fund October 2, 1989
Maine Municipal Bond Fund December 5, 1991
New Hampshire Bond Fund December 31, 1992
Investors Growth Fund December 12, 1997
Payson Balanced Fund November 25, 1991
Payson Value Fund July 31, 1992
</TABLE>
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
These financial statements are prepared in accordance with accounting principles
generally accepted in the United States of America, which require management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities, the disclosure of contingent assets and liabilities at the date of
the financial statements, and the reported amounts of increase and decrease in
net assets from operations during the fiscal period. Actual amounts could differ
from those estimates. The following summarizes the significant accounting
policies of the Funds:
SECURITY VALUATION-On each Fund business day, the Trust determines the net asset
value per share of the Fund as of the close of regular trading day on the New
York Stock Exchange. Securities, other than short-term securities, held by the
Fund, and for which market quotations are readily available, are valued using
the last reported sales price provided by independent pricing services. If no
sales price is reported, the mean of the last bid and ask price is used. In the
absence of readily available market quotations, securities are valued at fair
value as determined by the Trust's Board of Trustees. Securities that mature in
sixty days or less are valued at amortized cost.
SECURITIES TRANSACTIONS, INTEREST INCOME AND REALIZED GAIN AND LOSS-Investment
transactions are accounted for on trade date. Dividend income is recorded on the
ex-dividend date. Interest income is recorded as earned. Identified cost of
investments sold is used to determine gain and loss for both financial statement
and federal income tax purposes.
36 FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2000
--------------------------------------------------------------------------------
REPURCHASE AGREEMENTS-Each Fund may invest in repurchase agreements. The Funds,
through their custodian, receive delivery of the underlying securities, whose
market value must always equal or exceed the repurchase price. In the event of
default, a Fund may have difficulties disposing of such securities.
DISTRIBUTIONS TO SHAREHOLDERS-Distributions to shareholders of net investment
income are declared daily and paid monthly by all Funds except Payson Balanced
Fund and Payson Value Fund, for which dividends are declared and paid quarterly
and Investors Growth Fund, for which dividends are declared and paid annually.
Net capital gains, if any, are declared and paid to shareholders at least
annually. Distributions are based on amounts calculated in accordance with
applicable federal income tax regulations, which may differ from generally
accepted accounting principles. These differences are due primarily to differing
treatments of income and gain on various investment securities held by each
Fund, timing differences and differing characterizations of distributions made
by the Fund.
ORGANIZATION COSTS-Costs incurred by Investors High Grade Bond Fund and
Investors Growth Fund in connection with their organization are amortized using
the straight-line method over a five year period.
FEDERAL TAXES-Each Fund intends to qualify each year as a regulated investment
company and distribute all its taxable income. In addition, by distributing in
each calendar year substantially all its net investment income, capital gains
and certain other amounts, if any, each Fund will not be subject to federal
excise tax. Therefore, no federal income or excise tax provision is required.
EXPENSE ALLOCATION-The Trust accounts separately for the assets and liabilities
and operations of each of its funds. Expenses that are directly attributable to
more than one fund are allocated among the respective funds in proportion to
each fund's average daily net assets.
NOTE 3. ADVISORY FEES, SERVICING FEES AND OTHER TRANSACTIONS WITH AFFILIATES
INVESTMENT ADVISERS-The investment adviser for each of Investors High Grade Bond
Fund, Investors Bond Fund, TaxSaver Bond Fund, Maine Municipal Bond Fund, New
Hampshire Bond Fund and Investors Growth Fund is Forum Investment Advisors, LLC
("Forum Advisors"). Forum Advisors receives an advisory fee from each of
Investors High Grade Bond Fund, Investors Bond Fund, TaxSaver Bond Fund, Maine
Municipal Bond Fund and New Hampshire Bond Fund at an annual rate of 0.40% of
each Fund's average daily net assets and 0.65% of the average daily net assets
from Investors Growth Fund. The investment adviser for Payson Balanced Fund and
Payson Value Fund is H.M. Payson & Co. ("Payson"). Payson receives an advisory
fee of 0.60% and 0.80% of the average daily net assets of Payson Balanced Fund
and Payson Value Fund, respectively.
ADMINISTRATOR-The administrator of each Fund is Forum Administrative Services,
LLC ("FAdS"). For its services, FAdS receives an administrative fee at an annual
rate of 0.20% of the average daily net assets of each Fund.
TRANSFER AGENT AND DIVIDEND DISBURSING AGENT-The transfer agent and dividend
disbursing agent for each Fund is Forum Shareholder Services, LLC ("FSS"). FSS
receives from each fund an annual fee of $12,000, 0.25% of the average daily net
assets of the Fund, plus certain shareholder account fees.
37 FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2000
--------------------------------------------------------------------------------
DISTRIBUTOR-Forum Fund Services, LLC ("FFS"), a registered broker-dealer and a
member of the National Association of Securities Dealers, Inc., is the
distributor of each Fund's shares. FFS receives and may reallow to certain
institutions the sales charge paid on purchases of the Funds' shares. Prior to
August 1, 1999, Forum Financial Services, Inc. provided distribution services to
each Fund for the same compensation as FFS.
For the year ended March 31, 2000, FFS reallowed $963, $147,723, $35,132, $9 and
$1,637 in commissions to certain financial institutions regarding purchases of
TaxSaver Bond Fund, Maine Municipal Bond Fund, New Hampshire Bond Fund, Payson
Balanced Fund and Payson Value Fund, respectively. FFS retained net commissions
of $145, $18,335, $9,085, $1 and $220 from purchases of TaxSaver Bond Fund,
Maine Municipal Bond Fund, New Hampshire Bond Fund, Payson Balanced Fund and
Payson Value Fund, respectively.
OTHER SERVICE PROVIDERS-Forum Accounting Services, LLC ("FAcS") provides fund
accounting services to each Fund. For its services FAcS receives an annual fee
of $36,000 per Fund, plus certain amounts based upon the asset level of a Fund,
as well as the number and types of portfolio transactions made by a Fund.
NOTE 4. WAIVER OF FEES
Certain service providers of each Fund have voluntarily undertaken to waive a
portion of their fees so that total expenses of each Fund would not exceed
certain limitations. Fee waivers may be reduced or eliminated at any time. For
the year ended March 31, 2000, fees waived were as follows:
<TABLE>
<CAPTION>
FEES WAIVED
-----------------------------------------------------
FORUM TOTAL FEES
ADVISORS PAYSON FSS FACS FADS WAIVED
-------- ------ --- ---- ---- -----------
<S> <C> <C> <C> <C> <C> <C>
Investors High Grade Bond Fund....... $44,542 $ -- $ 49,385 $ -- $50,982 $144,909
Investors Bond Fund.................. 18,811 -- 101,651 -- 92,120 212,582
TaxSaver Bond Fund................... 55,793 -- 65,100 9,000 52,812 182,705
Maine Municipal Bond Fund............ 46,346 -- 99,977 36,000 48,336 230,659
New Hampshire Bond Fund.............. 39,223 -- 48,271 27,000 29,165 143,659
Investors Growth Fund................ 45,005 -- 6,788 -- 44,921 96,714
Payson Balanced Fund................. -- 52,726 -- -- 27,376 80,102
Payson Value Fund.................... -- 46,254 -- -- 11,307 57,561
</TABLE>
38 FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2000
--------------------------------------------------------------------------------
NOTE 5. SECURITY TRANSACTIONS
The cost of purchases and proceeds from sales of investment securities
(including maturities), other than short-term investments, for the year ended
March 31, 2000, were as follows:
<TABLE>
<CAPTION>
COST OF PROCEEDS FROM SALES
PURCHASES AND MATURITIES
(EXCLUDING (EXCLUDING COST OF GOV'T PROCEEDS OF
GOVERNMENT GOVERNMENT OBLIGATIONS GOV'T
OBLIGATIONS) OBLIGATIONS) PURCHASES SALES
------------ ------------------- ------------- ------------
<S> <C> <C> <C> <C>
Investors High Grade Bond Fund.......... $ 3,965,220 $ 5,991,990 $ 139,920 $2,903,846
Investors Bond Fund..................... 18,616,358 31,942,744 2,033,992 3,052,636
TaxSaver Bond Fund...................... 7,999,129 14,616,910 -- --
Maine Municipal Bond Fund............... 8,516,813 7,154,545 -- --
New Hampshire Bond Fund................. 2,760,593 5,460,780 -- --
Investors Growth Fund................... -- 10,605,885 -- --
Payson Balanced Fund.................... 11,123,584 15,249,330 290,019 193,346
Payson Value Fund....................... 3,753,642 5,102,218 -- --
</TABLE>
For federal income tax purposes, the tax basis of investment securities owned as
of March 31, 2000, the aggregate gross unrealized appreciation for all
securities in which there was an excess of market value over tax cost, the
aggregate gross unrealized depreciation for all securities in which there was an
excess of tax cost over market value, and the capital loss carryovers (which
expire in March 2008) were as follows:
<TABLE>
<CAPTION>
NET UNREALIZED CAPITAL
UNREALIZED UNREALIZED APPRECIATION LOSS
TAX COST APPRECIATION DEPRECIATION (DEPRECIATION) CARRYOVERS
-------- ------------ ------------ -------------- ------------
<S> <C> <C> <C> <C> <C>
Investors High Grade Bond
Fund....................... $29,122,907 $ 140,484 $1,315,417 $(1,174,933) $ 83,619
Investors Bond Fund......... 53,708,293 57,357 3,674,321 (3,616,964) 385,496
TaxSaver Bond Fund.......... 28,626,862 264,546 801,085 (536,539) 275,067
Maine Municipal Bond Fund... 31,612,655 415,862 456,081 (40,219) 55,812
New Hampshire Bond Fund..... 11,601,371 88,211 230,404 (142,193) 14,375
Investors Growth Fund....... 5,953,960 14,890,309 -- 14,890,309 --
Payson Balanced Fund........ 17,907,343 2,166,906 1,480,670 686,236 --
Payson Value Fund........... 13,527,378 7,336,148 832,085 6,504,063 --
</TABLE>
NOTE 6. CONCENTRATION OF RISK
The Maine Municipal Bond Fund and New Hampshire Bond Fund invest substantially
all their assets in debt obligations of issuers located in the states of Maine
and New Hampshire, respectively. The issuers' abilities to meet their
obligations may be affected by Maine and Hew Hampshire economic or political
developments.
39 FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
MARCH 31, 2000
--------------------------------------------------------------------------------
NOTE 7. FEDERAL TAX STATUS OF DIVIDENDS DECLARED DURING THE FISCAL YEAR
(UNAUDITED)
The amounts of long-term capital gain dividends paid during the period are
presented below. For federal income tax purposes, dividends from short-term
capital gain are classified as ordinary income. All net investment income
dividends were ordinary income, except for those Funds noted below that paid
exempt income dividends. The percentage of qualifying dividends eligible for the
corporate dividends received deduction are also presented below for the
applicable Funds.
<TABLE>
<CAPTION>
LONG TERM QUALIFYING ORDINARY EXEMPT
CAPITAL GAIN DIVIDENDS INCOME INTEREST
------------ --------- ------ --------
<S> <C> <C> <C> <C>
Investors High Grade Bond Fund................... $ 56,200 -- 100.00% --
Investors Bond Fund.............................. -- -- 100.00% --
TaxSaver Bond Fund............................... -- -- 0.02% 99.98%
Maine Municipal Bond Fund........................ 22,511 -- 0.04% 99.96%
New Hampshire Bond Fund.......................... 2,495 -- 0.03% 99.97%
Investors Growth Fund............................ 1,518,841 100.00% -- --
Payson Balanced Fund............................. 416,568 49.75% 50.25% --
Payson Value Fund................................ 611,758 100.00% -- --
</TABLE>
NOTE 8. SUBSEQUENT EVENTS
On May 15, 2000, the Board of Trustees approved the reorganization of Investors
Growth Fund into Investors Equity Fund. Both Funds are a series of Forum Funds.
Shareholders will be asked to approve the reorganization by proxy, and the
reorganization is expected to occur on or about July 28, 2000.
40 FORUM FUNDS-Registered Trademark-
<PAGE>
--------------------------------------------------------------------------------
INDEPENDENT AUDITORS' REPORT
--------------------------------------------------------------------------------
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS,
FORUM FUNDS:
We have audited the accompanying statements of assets and liabilities,
including the schedules of investments, of the Investors High Grade Bond Fund,
Investors Bond Fund, Taxsaver Bond Fund, Maine Municipal Bond Fund, New
Hampshire Bond Fund, Investors Growth Fund, Payson Balanced Fund and Payson
Value Fund (certain of the series constituting Forum Funds), (the "Funds") as of
March 31, 2000, the related statements of operations for the year then ended,
the statements of changes in net assets for the two years ended March 31, 2000
and 1999, and the financial highlights for each of the five years in the period
ended March 31, 2000. These financial statements and financial highlights are
the responsibility of the Funds' management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audits.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of March 31, 2000 by correspondence with the custodian and
brokers; where replies were not received from brokers, we performed other
auditing procedures. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, such financial statements and financial highlights present
fairly, in all material respects, the financial position of the aforementioned
Funds, as of March 31, 2000, and the results of their operations and changes in
their net assets, and their financial highlights for the respective stated
periods in conformity with accounting principles generally accepted in the
United States of America.
Deloitte & Touche LLP
Boston, MA
May 12, 2000
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FOR MORE INFORMATION FORUM
FUNDS
INVESTORS HIGH GRADE
BOND FUND
INVESTORS BOND FUND
TAXSAVER BOND FUND
MAINE MUNICIPAL
BOND FUND
NEW HAMPSHIRE
BOND FUND
INVESTORS GROWTH FUND
PAYSON BALANCED FUND
PAYSON VALUE FUND
TRANSFER AGENT
Forum Shareholder Services, LLC
Two Portland Square
Portland, ME 04101
DISTRIBUTOR
Forum Fund Services, LLC
Two Portland Square
Portland, ME 04101
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FORUM FUNDS
P.O. Box 446
Portland, Maine 04112
800-94FORUM (Shareholder Services)
800-95FORUM (Dealer Services)
207-879-0001
www.forumfunds.com
This report is authorized for distribution only to
shareholders and to others who have received a copy
of the Funds' prospectus.
