<PAGE> 1
JOHN HANCOCK FUNDS
- --------------------------------------------------------------------------------
PATRIOT
GLOBAL
DIVIDEND
FUND
ANNUAL REPORT
July 31, 1995
<PAGE> 2
TRUSTEES
Edward J. Boudreau, Jr.
Thomas W.L. Cameron
James F. Carlin*
William H. Cunningham*
Charles F. Fretz*
Harold R. Hiser, Jr.*
Charles L. Ladner*
Leo E. Linbeck, Jr.
Patricia P. McCarter*
Steven R. Pruchansky*
Richard S. Scipione
Lt. Gen. Norman J. Smith, USMC (Ret.)*
John P. Toolan*
*Members of the Audit Committee
OFFICERS
Edward J. Boudreau, Jr.
Chairman and Chief Executive Officer
Robert G. Freedman
Vice Chairman and
Chief Investment Officer
Andrew F. St. Pierre
President
Anne C. Hodsdon
Executive Vice President
Michael P. DiCarlo
Senior Vice President
Thomas H. Drohan
Senior Vice President and Secretary
James K. Ho
Senior Vice President
James B. Little
Senior Vice President and
Chief Financial Officer
John A. Morin
Vice President and Compliance Officer
Susan S. Newton
Vice President and Assistant Secretary
James J. Stokowski
Vice President and Treasurer
INVESTMENT ADVISER
John Hancock Advisers, Inc.
101 Huntington Avenue
Boston, Massachusetts 02199-7603
INVESTMENT SUB-ADVISER
John Hancock Advisers International Limited
34 Dover Street
London, England w1x3ra
CUSTODIAN AND TRANSFER AGENT
FOR COMMON SHAREHOLDERS
State Street Bank and Trust Company
225 Franklin Street
Boston, Massachusetts 02110
TRANSFER AGENT FOR DARTS
Chemical Bank
450 West 33rd Street
New York, New York10001
LEGAL COUNSEL
Hale and Dorr
60 State Street
Boston, Massachusetts 02109
INDEPENDENT PUBLIC ACCOUNTANTS
Arthur Andersen llp
One International Place
Boston, Massachusetts 02110-2604
Listed New York Stock Exchange Symbol: PGD
John Hancock Closed End Funds: 1-800-843-0090
CHAIRMAN'S MESSAGE
DEAR FELLOW SHAREHOLDERS:
[A 1 1/4" x 1" photo of Edward J. Boudreau Jr., Chairman and Chief Executive
Officer, flush right, next to second paragraph.]
Educating shareholders has always been one of the most important
responsibilities of an investment company. But that challenge has taken on new
significance in the past several years. Looking at the most recent statistics,
you can see why. According to the Investment Company Institute, the mutual
fund industry now manages more than $2.3 trillion for investors. More than
half of that money has come into mutual funds in just the last four years.
Today, there are more than 95 million mutual fund shareholder accounts. That's
up from 12 million in 1980. These are people, perhaps like you, who are
investing in mutual funds to save for a home, to send their children to
college or to build a nest egg for a comfortable retirement. This explosive
growth, coupled with the growing complexity of the financial landscape, has
made all of us in the mutual fund industry work harder to inform our
shareholders.
At John Hancock Funds, we strive to educate you about all aspects of
your fund: the performance, the strategies and the holdings. We want you to
fully understand what you own. We want you to have realistic expectations of
the potential rewards as well as the potential risks of your investment. These
shareholder reports -- which we send you twice a year -- are the best way to
give you the most in-depth and up-to-date information.
In the message that follows, the portfolio manager gives a candid
commentary on the market environment; the factors that affected performance;
the Fund's current investment strategies; and the outlook for the months
ahead. The ensuing financial statements provide a comprehensive look at the
fund's statistics and holdings. We've included explanations of what each
financial statement shows and how it is used.
We hope you find these shareholder reports a useful tool in evaluating
your investments. Of course, if you have any questions or need more
information, feel free to call us toll-free at 1-800-843-0900, from 8:30 a.m.
to 5:00 p.m. eastern time, Monday through Friday.
Sincerely,
/S/ EDWARD J. BOUDREAU, JR.
EDWARD J. BOUDREAU, JR., CHAIRMAN AND CHIEF EXECUTIVE OFFICER
2
<PAGE> 3
BY ANDREW F. ST. PIERRE,
PRESIDENT AND PORTFOLIO MANAGER
PATRIOT GLOBAL
DIVIDEND FUND
Slower growth and falling interest rates boost preferred stocks;
----------------------------------------------------------------
utilities gain on improved regulatory outlook
---------------------------------------------
Nearly ideal market conditions during the first half of 1995 produced gains
that more than made up for the Fund's slow start during the second half of
1994. The result was solid, double-digit returns for the Fund's fiscal year.
When the period began, the investment climate could not have been much
worse for global income-producing securities. Growth was accelerating,
interest rates were rising and the bond market was in the midst of its worst
sell-off in more than half a century. Preferred stocks, which totaled nearly
three-quarters of the Fund's net assets at the end of the period, were
vulnerable, because of their fixed yields, to the same market forces that
undermined bond prices. As preferred prices fell, frustrated inve stors
unloaded their holdings, flooding the market and depressing prices still
further. Utility stocks, both commons and preferreds -- which together
averaged around 40% of the Fund's net assets during the period -- were hurt
two ways: by rising interest rates and a hostile regulatory climate. Foreign
stocks -- all of them international issues denominated in U.S. dollars --
averaged
"...during the first half of 1995...the investment climate improved
dramatically."
[A 2 1/2" x 3 3/4" photo of Andrew F. St. Pierre at bottom right. Caption reads:
"Andrew F. St. Pierre, Portfolio Manager."]
3
<PAGE> 4
John Hancock Funds - Patriot Global Dividend Fund
- --------------------------------------------------------------------------------
PORTFOLIO DIVERSIFICATION
[Pie chart with the heading "Portfolio Diversification" at top of left hand
column. The chart is divided into four sections. Going from left to right:
Industrials 15%; Financials 30%; Other Investments 15%; and Utilities
40%. A footnote below states "As a percentage of net assets on July 31,
1995."]
- --------------------------------------------------------------------------------
25% of the Fund's assets. Their lackluster performance stemmed from investor
apathy prompted by turmoil in various foreign markets in the first half of the
period.
But after a torrid fourth quarter in 1994, the U.S. economy slowed down
during the first half of 1995 and the investment climate improved dramatically.
After the last rate increase by the Federal Reserve in February 1995, interest
rates began falling, boosting bonds and stocks alike. Preferred stocks, because
they're more sensitive than other stocks to interest rates, were among the
biggest beneficiaries. Utilities, meanwhile, benefited from an improved
regulatory outlook. For the year ended July 31, 1995, John Hancock Patriot
Global Dividend Fund had a total return of 16.45% at net asset value, compared
to 13.70% total return for the 30-year Treasury bond and 9.44% for the Dow
Jones Utility Average.(1)
STRATEGIC RESPONSE TO FALLING RATES
In late January 1995, we began repositioning the Fund to benefit from a
falling-rate environment. That included boosting the Fund's stake in
preferred stocks, which rose from 61% a year ago to 70% at the end of July.
Preferred stocks, with their fixed payouts, closely track the treasury market.
As Treasuries rallied in the Spring, preferreds climbed with them. We also took
advantage of depressed values and abundant supply to add high-quality
securities at bargain prices. In choosing securities, we looked for two key
characteristics: call protection, which prevents an issuer from redeeming a
security before the expiration of a prescribed term; and DRD eligibility. DRD
stands for dividend received deduction. Securities that are DRD-eligible offer
distinct tax advantages to corporate investors. Because they're not as common
as they were when we began adding them to our holdings, they've become more
valuable. Here's a sector-by-sector rundown of the Fund's investments.
*UTILITIES. In April 1994, officials in California began an initiative aimed at
speeding up the pace of regulatory reform in the electric utility industry. The
prospect of greater competition sent a chill through the industry, causing
credit-rating agencies to downgrade utilities and investors to flee. But after
much bickering among lawmakers, environmentalists, consumers and the utilities
themselves, the regulators recently adopted a more moderate stance. That,
combined with lower interest rates, ignited a strong rally, not only in
California but across the country. We added electric utilities during the
early stages of the rally, increasing the Fund's stake from
"...we began repositioning the Fund to benefit from a
falling-rate environment."
[Table entitled "Scorecard" at bottom of left hand column. The header for the
left column is "Investments"; the header for the right column is "Recent
performance ... and what's behind the numbers. The first listing is
Narragansett Electric followed by an up arrow and the phrase "Good call
protection." The second listing is Bank of Boston followed by an up arrow and
the phrase "High yield." The third listing is Gulf States Utilities followed by
a down arrow and the phrase "Credit downgrade." Footnote below reads: "See
"Schedule of Investments." Investment holdings are subject to change."]
4
<PAGE> 5
John Hancock Funds - Patriot Global Dividend Fund
- --------------------------------------------------------------------------------
FUND PERFORMANCE
[Bar chart with heading "Fund Performance" at top of left hand column. Under
the heading is the footnote: "For the year ended July 31, 1995." The chart is
scaled in increments of 5% from bottom to top, with 20% at the top and 0% at
the bottom. Within the chart, there are three solid bars. The first represents
the 16.45% total return for John Hancock Patriot Global Dividend Fund. The
second represents the 9.44% total return for the Dow Jones Utility Average. The
third represents the 13.70% total return for the 30-year Treasury Bond.
Footnote below reads: "The total return for John Hancock Patriot Global
Dividend Fund is at net asset value with all distributions reinvested. The Dow
Jones Utility Average is an unmanaged index, which measures the performance of
the utility industry in the United States.(1)"]
- --------------------------------------------------------------------------------
about 34% at the beginning of the period to about 40% at the end of July, split
roughly equally among commons and preferreds. Among the top performing
preferreds was one issued by Narragansett Electric yielding 6.95% and combining
DRD-eligibility with 10 years of call protection. A common stock that did
especially well was Southern Co., a high-quality, well-managed electric utility
with above-average dividend growth potential. Gulf States Utilities, on the
other hand, turned in a disappointing performance after both Moody's and
Standard & Poor's lowered the company's credit rating last spring; a high
coupon and DRD eligibility cushioned the blow but didn't prevent it from
lagging other utilities.
*FINANCIALS. Financial stocks -- including investment companies, foreign and
domestic banks, and insurance companies -- totaled about 30% of the Fund's net
assets at the end of July. While here, too, we were often looking for
DRD-eligible securities with good call protection, our focus was more on
higher-yielding preferred stocks. While these securities are considered
defensive -- and tend to lag other securities during a market rally -- they do
provide the Fund with an attractive yield. Examples include Bank of Boston,
which boasts DRD eligibility, two years of call protection and an 8.6% yield;
and Shawmut National, also DRD eligible, which has five years of call
protection and a 9.35% yield. Shawmut National is due for a credit upgrade once
its announced merger with Fleet Financial Services is consummated. Non-bank
preferred holdings in the same category include Merrill Lynch, yielding
9.0% with 10 years of call protection; and Travelers Group, yielding 9.25% with
two years of call protection.
*INDUSTRIALS. Rising prices for lumber, liner board and other forest products
boosted profits for Bowater, making it a likely candidate for an eventual
upgrade by the credit-rating agencies and a top performer during the period.
Two auto stocks also did well: a DRD-eligible security from Ford Motor
Co. yielding 8.25%; and a General Motors security yielding just over 9%. Both
benefited from a massive tender offer by General Motors last spring, which
reduced the supply of preferreds in the auto sector. Together, industrial
holdings totaled about 15% of the Fund's net assets at the end of July.
A WORD ABOUT DIVIDENDS
A key influence on 1994's market was the Federal Reserve Board's efforts to
slow economic growth and prevent inflation by raising short-term interest
rates. The result was an
"...it seems unlikely the Fund can maintain the momentum..."
- --------------------------------------
(1) Source: Lipper Analytical Services
5
<PAGE> 6
John Hancock Funds - Patriot Global Dividend Fund
increase in the federal funds rate -- what banks charge each other for overnight
loans -- from 3% to 6% between February 1994 and February 1995. As you know, the
Fund is leveraged with auction-rate preferred stock. Since the preferred stock's
dividend is based on short-term rates, the recent increases by the Federal
Reserve have directly impacted the dividend rates paid on the preferred shares.
This results in less dividend income available to common stock shareholders. In
order to maintain the Fund's conservative approach of only paying income earned
on the Fund, thus avoiding a return of capital, you may recall that in February
1995 the Fund's Board of Trustees approved a $0.0156 per share reduction in the
monthly dividend, to $0.0875 per share. It is important to note that even
with the increased cost of funding the auction-rate preferred stock, the Fund is
still able to pay a higher dividend on its common stock than it would with a
non-leveraged portfolio.
OUTLOOK REMAINS FAVORABLE
After a terrific run during the first half of 1995, the bond market rally
stalled in July. While interest rates remain low and inflation is not yet a
serious threat -- both of which are pluses for income-producing securities --
it seems unlikely the Fund can maintain the momentum it generated in the midst
of the bond-market rally. As rates stabilize, the Fund's yield will likely
contribute more to total return than price gains. In any case, it probably
makes sense to lower our expectations going forward.
6
<PAGE> 7
FINANCIAL STATEMENTS
John Hancock Funds - Patriot Global Dividend Fund
THE STATEMENT OF ASSETS AND LIABILITIES IS THE FUND'S BALANCE SHEET AND SHOWS
THE VALUE OF WHAT THE FUND OWNS, IS DUE AND OWES ON JULY 31, 1995. YOU'LL
ALSO FIND THE NET ASSET VALUE PER SHARE, FOR EACH COMMON SHARE, AS OF THAT
DATE.
<TABLE>
STATEMENT OF ASSETS AND LIABILITIES
July 31, 1995
- ----------------------------------------------------------------------------
<S> <C>
ASSETS:
Investments at value - Note C:
Preferred stocks (cost - $115,961,022)................. $117,735,721
Common stocks (cost - $39,490,907)..................... 37,738,325
Capital securities (cost - $7,448,750)................. 7,714,500
Short-term investments (cost - $5,054,000)............. 5,054,000
------------
168,242,546
Cash..................................................... 819
Receivable for investments sold.......................... 1,552,853
Dividends receivable..................................... 1,010,625
Deferred organization expenses - Note A.................. 50,675
Other assets............................................. 29,178
------------
Total Assets.................. 170,886,696
-----------------------------------------------
LIABILITIES:
DARTS dividend payable - Note A.......................... 273,900
Payable for investments purchased........................ 1,583,400
Payable to John Hancock Advisers, Inc. and
affiliates - Note B.................................... 157,717
Accounts payable and accrued expenses.................... 47,795
------------
Total Liabilities............. 2,062,812
-----------------------------------------------
NET ASSETS:
Dutch Auction Rate Transferable Securities Preferred
Shares (DARTS) - Without par value, unlimited number
of shares of beneficial interest authorized, 600 shares
issued, liquidation preference of $100,000 per share -
Note A................................................. 60,000,000
------------
Common Shares - Without par value, unlimited number
of shares of beneficial interest authorized, 8,344,700
shares issued and outstanding.......................... 114,172,797
Accumulated net realized loss on investments............. (6,067,530)
Net unrealized appreciation of investments............... 287,867
Undistributed net investment income...................... 430,750
------------
Net Assets Applicable to
Common Shares ($13.04 per
share based on 8,344,700
shares outstanding)........... 108,823,884
-----------------------------------------------
Net Assets.................... $168,823,884
===============================================
</TABLE>
THE STATEMENT OF OPERATIONS SUMMARIZES THE FUND'S INVESTMENT INCOME EARNED
AND EXPENSES INCURRED IN OPERATING THE FUND. IT ALSO SHOWS NET GAINS (LOSSES)
FOR THE PERIOD STATED.
<TABLE>
STATEMENT OF OPERATIONS
Year ended July 31, 1995
- ---------------------------------------------------------------------------
<S> <C>
INVESTMENT INCOME:
Dividends (net of foreign withholding taxes of $129,927) $14,595,113
Interest................................................. 427,795
-----------
15,022,908
-----------
Expenses:
Investment management fee - Note B..................... 1,296,691
Administration fee - Note B............................ 243,130
DARTS and auction fees................................. 173,635
Custodian fee.......................................... 65,707
Printing............................................... 61,373
Auditing fee........................................... 55,850
Transfer agent fee..................................... 30,800
Miscellaneous.......................................... 26,437
Organization expense - Note A.......................... 25,337
Trustees' fees......................................... 25,077
Registration and filing fees........................... 17,640
Legal fees............................................. 17,162
Federal excise tax..................................... 3,324
-----------
Total Expenses................ 2,042,163
----------------------------------------------
Net Investment Income......... 12,980,745
----------------------------------------------
Realized and Unrealized Gain (Loss) on Investments:
Net realized loss on investments sold................ (5,444,639)
Change in net unrealized appreciation/depreciation
of investments..................................... 11,036,629
-----------
Net Realized and Unrealized
Gain on Investments........... 5,591,990
----------------------------------------------
Net Increase in Net Assets
Resulting from Operations..... $18,572,735
==============================================
Distributions to DARTS........ (2,766,286)
----------------------------------------------
Net Increase in Net Assets
Applicable to Common Shareholders
Resulting from Operations
Less DARTS Distributions...... $15,806,449
==============================================
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
7
<PAGE> 8
FINANCIAL STATEMENTS
John Hancock Funds - Patriot Global Dividend Fund
<TABLE>
STATEMENT OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------------------------------------------
<CAPTION>
YEAR ENDED JULY 31,
----------------------------
1995 1994
------------ ------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
FROM OPERATIONS:
Net investment income.......................................................... $ 12,980,745 $ 11,281,223
Net realized loss on investments sold.......................................... (5,444,639) (356,644)
Change in net unrealized appreciation/depreciation of investments.............. 11,036,629 (20,718,594)
------------ ------------
Net Increase (Decrease) in Net Assets Resulting from Operations.............. 18,572,735 (9,794,015)
------------ ------------
DISTRIBUTIONS TO SHAREHOLDERS:
DARTS ($4,610 and $3,517 per share, respectively) - Note A.................... (2,766,286) (2,110,130)
Common Shares - Note A
Dividends from accumulated net investment income ($1.1592 and $1.1106 per
share, respectively)....................................................... (9,672,846) (9,267,332)
Distributions from net realized short-term gain on investments sold (none
and $0.5361 per share, respectively)....................................... -- (4,473,538)
Distributions in excess of accumulated net investment income (none and
$0.0405 per share, respectively)........................................... -- (338,101)
------------ ------------
Total Distributions to Shareholders...................................... (12,439,132) (16,189,101)
------------ ------------
NET ASSETS:
Beginning of period.......................................................... 162,690,281 188,673,397
------------ ------------
End of period (including undistributed net investment income and
distributions in excess of net investment income of $430,750 and
($338,101), respectively).................................................. $168,823,884 $162,690,281
============ ============
</TABLE>
<TABLE>
ANALYSIS OF COMMON SHAREHOLDER TRANSACTIONS:
YEAR ENDED JULY 31,
---------------------------------------------------------
1995 1994
------------------------- ----------------------------
SHARES AMOUNT SHARES AMOUNT
--------- ------------ --------- ------------
<S> <C> <C> <C> <C>
Beginning of period................................... 8,344,700 $114,176,121 8,344,700 $114,220,602
Reclassification of capital accounts - Note D......... -- (3,324) -- (44,481)
--------- ------------ --------- ------------
End of period......................................... 8,344,700 $114,172,797 8,344,700 $114,176,121
========= ============ ========= ============
</TABLE>
THE STATEMENT OF CHANGES IN NET ASSETS SHOWS HOW THE VALUE OF THE FUND'S NET
ASSETS HAS CHANGED SINCE THE END OF THE PREVIOUS PERIOD. THE DIFFERENCE
REFLECTS EARNINGS LESS EXPENSES, ANY INVESTMENT GAINS AND LOSSES, DISTRIBUTIONS
PAID TO SHAREHOLDERS, AND ANY INCREASE DUE TO SALE OF COMMON SHARES AND DARTS.
THE FOOTNOTE ILLUSTRATES ANY RECLASSIFICATION OF SHARE CAPITAL AMOUNTS, THE
NUMBER OF COMMON SHARE AND DARTS SOLD AND OUTSTANDING AT THE END OF THE LAST
TWO PERIODS, ALONG WITH THE CORRESPONDING DOLLAR VALUE.
SEE NOTES TO FINANCIAL STATEMENTS.
8
<PAGE> 9
Financial Statements
John Hancock Funds - Patriot Global Dividend Fund
<TABLE>
FINANCIAL HIGHLIGHTS
Selected data for a Common Share outstanding throughout the periods
indicated, investment returns, key ratios and supplemental data are listed as follows:
- ---------------------------------------------------------------------------------------------------------------------
<CAPTION>
YEAR ENDED JULY 31,
------------------------------------------
1995 1994 1993*
------------ ----------- -----------
<S> <C> <C> <C>
COMMON SHARES
PER SHARE OPERATING PERFORMANCE
Net Asset Value, Beginning of Period............................. $ 12.31 $ 15.42 $ 13.95(a)
------------ ------------ ------------
Net Investment Income............................................ 1.55 1.35 1.21
Net Realized and Unrealized Gain (Loss) on Investments........... 0.67 (2.52) 1.73
------------ ------------ ------------
Total from Investment Operations....................... 2.22 (1.17) 2.94
------------ ------------ ------------
Less Distributions:
Dividends to DARTS Shareholders................................ (0.33) (0.25) (0.17)
Dividends from Accumulated Net Investment Income to
Common Shareholders.......................................... (1.16) (1.11) (1.03)
Distributions to Common Shareholders from Net Realized
Short-term Gain on Investments............................... -- (0.54) --
Distributions in Excess of Accumulated Net Investment Income... -- (0.04) --
------------ ------------ ------------
Total Distributions.................................... (1.49) (1.94) (1.20)
------------ ------------ ------------
DARTS and Common Shares Offering Costs........................... -- -- (0.14)
------------ ------------ ------------
DARTS Underwriting Discounts..................................... -- -- (0.13)
------------ ------------ ------------
Net Asset Value, End of Period................................... $ 13.04 $ 12.31 $ 15.42
============ ============ ============
Per Share Market Value, End of Period............................ $ 12.25 $ 12.00 $ 15.00
Total Investment Return at Market Value.......................... 13.12% (10.06%) 7.26%
RATIOS AND SUPPLEMENTAL DATA
Net Assets Applicable to Common Shares, End of Period............ $108,823,884 $102,690,281 $128,673,397
Ratio of Expenses to Average Net Assets**........................ 1.26% 1.27% 1.22%
Ratio of Net Investment Income to Average Net Assets**........... 8.01% 6.42% 6.06%
Portfolio Turnover Rate.......................................... 96% 39% 98%
SENIOR SECURITIES
Total DARTS Outstanding.......................................... $ 60,000,000 $ 60,000,000 $ 60,000,000
Asset Coverage per Unit (b)...................................... $ 278,812 $ 267,019 $ 311,065
Involuntary Liquidation Preference per Unit (c).................. $ 100,000 $ 100,000 $ 100,000
Approximate Market Value per Unit (c)............................ $ 100,000 $ 100,000 $ 100,000
<FN>
* For the period August 1, 1992 (commencement of operations) to July 31, 1993.
** Ratios calculated on the basis of expenses and net investment income applicable to both common and
preferred shares relative to the average net assets for both common and preferred shares.
(a) Initial price to commence operations.
(b) Calculated by subtracting the Fund's total liabilities (not including the DARTS) from the Fund's
total assets and dividing such amount by the number of DARTS outstanding, as of the applicable
1940 Act Evaluation Date.
(c) Plus accumulated and unpaid dividends.
</TABLE>
THE FINANCIAL HIGHLIGHTS SUMMARIZES THE IMPACT OF THE FOLLOWING FACTORS ON A
SINGLE COMMON SHARE FOR THE PERIOD INDICATED: THE NET INVESTMENT INCOME,
GAINS (LOSSES) AND DISTRIBUTIONS OF THE FUND. IT SHOWS HOW THE FUND'S NET
ASSET VALUE FOR A COMMON SHARE HAS CHANGED DURING THE PERIODS. IT ALSO SHOWS
THE TOTAL INVESTMENT RETURN FOR THE PERIODS BASED ON THE MARKET VALUE OF THE
FUND SHARES. ADDITIONALLY, IMPORTANT RELATIONSHIPS BETWEEN SOME ITEMS
PRESENTED IN THE FINANCIAL STATEMENTS ARE EXPRESSED IN RATIO FORM, AS WELL AS
INFORMATION ABOUT THE DARTS.
SEE NOTES TO FINANCIAL STATEMENTS.
9
<PAGE> 10
FINANCIAL STATEMENTS
John Hancock Funds - Patriot Global Dividend Fund
THE SCHEDULE OF INVESTMENTS IS A COMPLETE LIST OF ALL SECURITIES OWNED BY THE
FUND ON JULY 31, 1995. IT'S DIVIDED INTO FOUR MAIN CATEGORIES: PREFERRED
STOCKS, COMMON STOCKS, CAPITAL SECURITIES AND SHORT-TERM INVESTMENTS. THE
PREFERRED AND COMMON STOCKS AND CAPITAL SECURITIES ARE FURTHER BROKEN
DOWN BY INDUSTRY GROUPS. UNDER EACH INDUSTRY GROUP IS A LIST OF THE STOCKS
OWNED BY THE FUND. SHORT-TERM INVESTMENTS, WHICH REPRESENT THE FUND'S "CASH"
POSITION, ARE LISTED LAST.
<TABLE>
SCHEDULE OF INVESTMENTS
July 31, 1995
<CAPTION>
ISSUER, DESCRIPTION NUMBER OF SHARES MARKET VALUE
- ------------------- ---------------- ------------
<S> <C> <C>
PREFERRED STOCKS
AUTO/TRUCK (4.99%)
Ford Motor Co., 8.25%,
Depositary Shares, Ser B.......... 130,000 $ 3,445,000
General Motors Corp., 9.125%,
Depositary Shares, Ser B.......... 184,500 4,981,500
-------------
8,426,500
-------------
BANKS - FOREIGN (8.50%)
Allied Irish Banks, PLC, 11.875%,
American Depositary Receipt
("ADR") (Ireland)................. 144,500 3,937,625
Banco Bilbao Vizcaya International
(Gibraltar) Ltd., 9.75%,
Gtd Ser A, ADR (Spain)............ 91,200 2,542,200
Indosuez Holdings S.C.A., 10.375%,
Gtd Ser A, ADR (Luxembourg) (R)... 157,100 4,006,050
Royal Bank of Scotland Group PLC,
11.25%, Ser A (United Kingdom).... 105,000 2,808,750
Santander Overseas Bank, Inc.,
8.70%, Gtd Ser B (Puerto Rico).... 41,600 1,055,600
------------
14,350,225
------------
BANKS - U.S. (4.92%)
Bank of Boston Corp., 8.60%,
Depositary Shares, Ser E.......... 92,300* 2,411,338
Chase Manhattan Corp., 10.84%,
Ser I............................. 30,000* 911,250
Chase Manhattan Corp., 9.08%,
Ser J............................. 25,000* 650,000
Citicorp, 7.75%, Depository Shares,
Ser 22............................ 55,000* 1,381,875
First Interstate Bancorp., 9.875%,
Depositary Shares, Ser F.......... 65,000* 1,714,375
Shawmut National Corp., 9.35%,
Depositary Shares................. 45,000* 1,231,875
------------
8,300,713
------------
COMPUTER SERVICES (0.39%)
Comdisco Inc., 8.75%, Ser A......... 25,800 651,450
------------
CONGLOMERATES (0.82%)
Grand Metropolitan Delaware Co.,
9.42%, Gtd Ser A.................. 51,000* 1,389,750
------------
EQUIPMENT LEASING (0.27%)
AMERCO, 8.50%, Ser A................ 20,000 460,000
------------
FINANCIAL SERVICES (9.07%)
Ford Holdings Inc., 8.00%,
Depositary Shares, Ser B.......... 85,000* $ 2,188,750
Ford Holdings Inc., 8.10%,
Depositary Shares, Ser D.......... 30,000* 783,750
Merrill Lynch & Co., Inc., 9.00%,
Depositary Shares, Ser A.......... 70,000* 1,968,750
Morgan Stanley Group Inc., 8.88%,
Depositary Shares................. 37,000 943,500
Reliastar Financial Corp., 10.00%,
Depositary Shares................. 37,000* 962,000
Salomon Inc., 9.50%, Depositary
Shares, Ser C..................... 60,000 1,515,000
Santander Finance Ltd. 7.375%
Gtd Ser A......................... 70,000* 1,513,750
SunAmerica Inc., 9.25%, Ser B....... 207,000 5,433,750
------------
15,309,250
------------
INSURANCE (6.62%)
American Life Holding Co., $2.16.... 102,765 2,402,132
Aon Corp., 8.00%.................... 80,000 2,060,000
Progressive Corp. , 9.375%, Ser A... 85,500 2,212,312
Travelers Group, Inc., 9.25%,
Depositary Shares, Ser B.......... 170,460 4,495,882
------------
11,170,326
------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
10
<PAGE> 11
FINANCIAL STATEMENTS
John Hancock Funds - Patriot Global Dividend Fund
<TABLE>
<CAPTION>
ISSUER, DESCRIPTION NUMBER OF SHARES MARKET VALUE
- ------------------- ---------------- ------------
<S> <C> <C>
OIL & GAS (11.22%)
Coastal Corp., $2.125, Ser H.......... 50,000* $ 1,268,750
Elf Overseas Ltd., 8.50%, Gtd Ser A
(Cayman Islands).................... 150,000 3,900,000
ENSERCH Corp., ARP, Ser F............. 25,000 525,000
Enterprise Oil PLC, 10.50%, Ser A,
ADR (United Kingdom)................ 197,498 5,110,261
Lasmo PLC, 10.00%, Ser A, ADR
(United Kingdom).................... 130,000 3,103,750
Phillips Gas Co., 9.32%, Ser A........ 190,000 5,035,000
------------
18,942,761
------------
PAPER PRODUCTS & CONTAINERS (5.54%)
Boise Cascade Corp., 9.40%,
Depositary Shares, Ser F............ 140,000* 3,675,000
Bowater Inc., 8.40%, Depositary
Shares, Ser C....................... 225,000* 5,681,250
------------
9,356,250
------------
UTILITIES (17.40%)
Central Maine Power Co., 7.999%,
Ser A............................... 10,000 925,000
Central Maine Power Co., 8.875%, (R).. 16,000 1,544,000
Columbus Southern Power Co., 9.50%,
Ser 02/01/15........................ 10,000* 1,070,000
Commonwealth Edison Co., $8.40, Ser A. 23,875 2,339,750
Duke Power Co., 7.85%, Ser S.......... 27,410 2,895,181
Duke Power Co., 7.00%, Ser W.......... 9,700* 960,300
Florida Power & Light Co., 7.40%,
Ser G............................... 25,000* 2,500,000
Gulf States Utilities Co., $9.96...... 7,500* 762,188
Houston Lighting & Power Co., $8.12... 13,006 1,320,109
Indianapolis Power & Light Co., 8.20%. 10,350* 1,040,175
Jersey Central Power & Light Co.,
7.52%, Ser K........................ 28,000* 2,863,000
MCN Michigan Limited Partnership,
9.375%, Ser A....................... 50,000* 1,331,250
Narragansett Electric Co., 6.95%...... 32,000* 1,540,000
Pacific Gas & Electric Co., 7.04%,
Ser U............................... 98,887* 2,385,649
Southern California Gas Co., 7.75%.... 94,075 2,375,394
Texas Utilities Electric Co., $1.875,
Depositary Shares, Ser A............ 48,000 1,164,000
Texas Utilities Electric Co., $1.805,
Depositary Shares, Ser B............ 100,000* 2,362,500
------------
29,378,496
------------
TOTAL PREFERRED STOCKS
(Cost $115,961,022) (69.74%) 117,735,721
------ ------------
COMMON STOCKS
UTILITIES (22.36%)
Allegheny Power System, Inc. ......... 150,000 $ 3,600,000
Boston Edison Co...................... 40,000* 1,000,000
Carolina Power & Light Co............. 50,000 1,518,750
CINergy Corp. (formerly Cincinnati
Gas & Electric Co.)................. 45,000 1,170,000
Consolidated Edison Co. of NY, Inc.... 51,000 1,479,000
Delmarva Power & Light Co............. 50,000 993,750
Dominion Resources, Inc. of VA........ 55,000 1,959,375
Houston Industries, Inc............... 69,800 3,053,750
Idaho Power Co........................ 50,000 1,212,500
Northeast Utilities................... 50,000* 1,125,000
Oklahoma Gas & Electric Co............ 35,000* 1,190,000
Peco Energy Co........................ 40,000* 1,145,000
Potomac Electric Power Co............. 100,000* 2,075,000
Public Service Enterprise Group, Inc.. 129,000 3,579,750
Puget Sound Power & Light Co.......... 137,800 2,962,700
Southern Co........................... 120,000 2,640,000
Southwestern Public Service Co........ 30,000* 881,250
Texas Utilities Co.................... 100,000 3,387,500
Washington Water Power Co............. 80,000* 1,240,000
Western Resources, Inc................ 50,000 1,525,000
------------
TOTAL COMMON STOCKS
(Cost $39,490,907) (22.36%) 37,738,325
------ ------------
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
11
<PAGE> 12
FINANCIAL STATEMENTS
John Hancock Funds - Patriot Global Dividend Fund
<TABLE>
<CAPTION>
ISSUER, DESCRIPTION NUMBER OF SHARES MARKET VALUE
- ------------------- ---------------- ------------
<S> <C> <C>
CAPITAL SECURITIES
BANKS (4.57%)
A/S Eksportfinans, 8.70%, Capital
Securities (Norway).................. 59,000 $ 1,504,500
Australia and New Zealand Banking
Group Ltd., 9.125%,
Capital Securities (Australia)....... 190,000 5,130,000
National Westminster Bank PLC, 10.64%,
Ser A, Capital Securities
(United Kingdom)..................... 40,000 1,080,000
------------
TOTAL CAPITAL SECURITIES
(Cost $7,448,750) (4.57%) 7,714,500
------ ------------
<CAPTION>
INTEREST PAR VALUE
RATE (000's OMITTED) MARKET VALUE
-------- --------------- ------------
SHORT TERM INVESTMENTS
COMMERCIAL PAPER (2.99%)
Prudential Funding Corp.
08-01-95................. 5.75% 5,054 $ 5,054,000
------------
TOTAL SHORT-TERM INVESTMENTS (2.99%) 5,054,000
------- ------------
TOTAL INVESTMENTS (99.66%) $168,242,546
======= ============
<FN>
* Securities, other than short-term investments, newly added to the
portfolio during the period ended July 31, 1995.
(R) These securities are exempt from registration under rule 144A of the
Securities Act of 1933. Such securities may be resold, normally to
qualified institutional buyers, in transactions exempt from registration.
See Note A of the Notes to Financial Statements for valuation policy. Rule
144A securities amounted to $5,550,050 as of July 31, 1995.
Parenthetical disclosure of a foreign country in the security description
represents country of foreign issuer, however, security is U.S. dollar
denominated.
The percentage shown for each investment category is the total value
of that category as a percentage of the net assets of the Fund.
</TABLE>
SEE NOTES TO FINANCIAL STATEMENTS.
12
<PAGE> 13
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Patriot Global Dividend Fund
NOTE A --
ACCOUNTING POLICIES
John Hancock Patriot Global Dividend Fund (the "Fund") is a closed-end,
diversified management investment company, registered under the Investment
Company Act of 1940. Significant accounting policies of the Fund are as
follows:
VALUATION OF INVESTMENTS Securities in the Fund's portfolio are valued on the
basis of market quotations, valuations provided by independent pricing
services, or at fair value as determined in good faith in accordance with
procedures approved by the Trustees. Short-term debt investments maturing
within 60 days are valued at amortized cost which approximates market value.
INVESTMENT TRANSACTIONS Investment transactions are recorded as of the date of
purchase, sale or maturity. Net realized gains and losses on sales of
investments are determined on the identified cost basis.
FEDERAL INCOME TAXES The Fund's policy is to comply with the requirements of
the Internal Revenue Code that are applicable to regulated investment
companies and to distribute all of its taxable income, including any net
realized gain on investments, to its shareholders. Therefore, no federal
income tax provision is required. For federal income tax purposes, the Fund
has $4,194,460 of a capital loss carryforward available, to the extent
provided by regulations, to offset future net realized capital gains. If such
carryforwards are used by the Fund, no capital gains distributions will be
made. The carryforwards expire as follow: July 31, 2002 -- $10,379 and July
31, 2003 -- $4,184,081.
DIVIDENDS, DISTRIBUTIONS AND INTEREST Dividend income on investment securities
is recorded on the ex-dividend date. Interest income on investment securities
is recorded on the accrual basis.
The Fund records all dividends and distributions to shareholders from
net investment income and realized gains on the ex-dividend date. Such
distributions are determined in conformity with federal income tax
regulations. Due to permanent book/tax differences in accounting for certain
transactions, this has the potential for treating certain distributions as
return of capital as opposed to distributions of net investment income or
realized capital gains. The Fund has adjusted for the cumulative effect of
such permanent book/tax differences through July 31, 1995, which has no
effect on the Fund's net assets, net investment income or net realized gains.
DEFERRED ORGANIZATION EXPENSES Expenses incurred in connection with the
organization of the Fund have been capitalized and are being charged ratably
to the Fund's operations over a five-year period that began with the
commencement of the investment operations of the Fund.
DUTCH AUCTION RATE TRANSFERABLE SECURITIES PREFERRED SHARES (DARTS) The Fund
issued 600 shares of DARTS on October 16, 1992 in a public offering. The
underwriting discount was recorded as a reduction of the capital of the
Common Shares. Dividends on the DARTS, which accrue daily, are cumulative at
a rate which was established at the offering of the DARTS and have been reset
every 49 days thereafter by an auction. Dividend rates ranged from 3.48% to
4.70% during the period ended July 31, 1995.
The DARTS are redeemable at the option of the Fund, at a redemption
price equal to $100,000 per share, plus accumulated and unpaid dividends on
any dividend payment date. The DARTS are also subject to mandatory redemption
at a redemption price equal to $100,000 per share, plus accumulated and
unpaid dividends, if the Fund is in default on its asset coverage requirements
with respect to the DARTS. If the dividends on the DARTS shall remain unpaid
in an amount equal to two full years' dividends, the holders of the DARTS, as
a class, have the right to elect a majority of the Board of Trustees. In
general, the holders of the DARTS and the Common Shares have equal voting
rights of one vote per share, except that the holders of the DARTS, as a
class, vote to elect two members of the Board of Trustees, and separate class
votes are required on certain matters that affect the respective interests of
the DARTS and Common Shares. The DARTS have a liquidation preference of
$100,000 per share, plus accumulated and unpaid dividends. The Fund is
required to maintain certain asset coverage with respect to the DARTS, as
defined in the Fund's By-Laws.
13
<PAGE> 14
NOTES TO FINANCIAL STATEMENTS
John Hancock Funds - Patriot Global Dividend Fund
NOTE B --
MANAGEMENT FEE AND TRANSACTIONS
WITH AFFILIATES AND OTHERS
Under the investment management contract, the Fund pays a monthly management
fee to John Hancock Advisers, Inc. (the "Adviser"), a wholly-owned subsidiary
of The Berkeley Financial Group, for a continuous investment program
equivalent, on an annual basis, to the sum of .80 of 1% of the Fund's average
weekly net assets.
In addition, the Adviser has a sub-investment management contract
with John Hancock Advisers International Limited (the "Sub-Adviser"), a
wholly-owned subsidiary of the Adviser. Under the Sub-Advisory Agreement
between the Adviser and the Sub-Adviser, the Sub-Adviser will furnish the
Adviser with international portfolio management assistance. The Adviser pays
the Sub-Adviser a monthly management fee equivalent, on an annual basis, to
.05 of 1% of the Fund's average weekly net assets.
The Fund has entered into an administrative agreement with Mitchell
Hutchins Asset Management Inc. (the "Administrator"), under which the
Administrator, if requested by the Adviser, assists in preparing financial
information and reports, providing information for tax reporting purposes,
compliance, calculation of net asset values, etc. The Fund pays the
Administrator a monthly fee equivalent, on an annual basis, to the sum of .15
of 1% of the Fund's average weekly net assets, with a minimum annual fee of
$125,000. The Administrator is an affiliate of Paine-Webber Incorporated,
which acted as an underwriter of the Fund's Common Shares.
Each unaffiliated Trustee is entitled as compensation for his or her
services, to an annual fee plus remuneration for attendance at various
meetings.
Messrs. Edward J. Boudreau, Jr. and Richard S. Scipione are directors
and/or officers of the Adviser and/or its affiliates, as well as Trustees of
the Fund. The compensation of unaffiliated Trustees is borne by the Fund.
Effective with the fees paid for 1995, the unaffiliated Trustees may elect to
defer for tax purposes their receipt of this compensation under the John
Hancock Group of Funds Deferred Compensation Plan. The Fund will make
investments into other John Hancock Funds, as applicable, to cover its
liability with regard to the deferred compensation. Investments to cover the
Fund's deferred compensation liability will be recorded on the Fund's books
as an other asset. The deferred compensation liability and the investment to
cover the liability will be marked to market on a periodic basis to reflect
income earned by the investment.
NOTE C -- INVESTMENT TRANSACTIONS Purchases and proceeds from sales of
securities, other than obligations of the U.S. government and its agencies
and short-term securities, during the period ended July 31, 1995, aggregated
$147,422,741 and $141,621,429, respectively. Purchases and proceeds from
sales of obligations of the U.S. government and its agencies, during the
period ended July 31, 1995, aggregated $7,975,000 and $8,022,367,
respectively. The cost of investments owned (including short-term investments)
at July 31, 1995 for Federal income tax purposes was $170,105,688. Gross
unrealized appreciation and depreciation of investments aggregated $3,382,858
and $5,246,000, respectively, resulting in net unrealized depreciation of
$1,863,142.
NOTE D -- RECLASSIFICATION OF CAPITAL ACCOUNTS In accordance with Statement of
Position 93-2, the Fund has recorded several reclassifications in the
capital accounts. These reclassifications have no impact on the net asset
value of the Fund and are designed generally to present undistributed net
investment income or accumulated net realized gains and losses on a tax basis,
which is considered to be more informative to the shareholder. As of July 31,
1995, the Fund has reclassified amounts to reflect an increase in
undistributed net investment income of $227,238, an increase in accumulated
net realized loss on investments of $223,914 and an decrease in capital paid
in of $3,324.
14
<PAGE> 15
John Hancock Funds - Patriot Global Dividend Fund
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Shareholders and Board of Trustees of
John Hancock Patriot Global Dividend Fund:
We have audited the accompanying statement of assets and liabilities of John
Hancock Patriot Global Dividend Fund (the Fund), including the schedule of
investments, as of July 31, 1995, the related statement of operations for the
year then ended, and the statement of changes in net assets and the financial
highlights for the periods presented. These financial statements and
financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these statements and financial
highlights based on our audits.
We conducted our audits in accordance with generally accepted
auditing standards. 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 July 31, 1995 by correspondence with the custodian and
brokers. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of John Hancock Patriot Global Dividend Fund as of July 31, 1995,
the results of its operations for the year then ended and the changes in its
net assets and the financial highlights for the periods presented, in
conformity with generally accepted accounting principles.
Arthur Andersen LLP
Boston, Massachusetts
September 6, 1995
TAX INFORMATION NOTICE (UNAUDITED)
For Federal Income Tax purposes, the following information is
furnished with respect to the taxable distributions of the Fund
during its fiscal year ended July 31, 1995.
The Board of Trustees of the Fund declared dividends on the Common
Shares from undistributed net investment income amounting to $1.16 per share,
for the year ended July 31, 1995. Distributions to preferred and common
shareholders were 80.30% qualified for the dividends received deductions.
Preferred shareholders received additional dividends of $266.18 per share as
of July 31, 1995 so that their net after-tax return for all dividends
including the additional dividends was the same as if all regular dividends
were 100% qualified for the dividends received deduction, as defined in the
Fund's By-Laws. Shareholders will be mailed a 1995 U.S. Treasury Department
Form 1099-DIV in January 1996 representing their proportionate share.
15
<PAGE> 16
John Hancock Funds - Patriot Global Dividend Fund
INVESTMENT OBJECTIVE AND POLICY
The Fund's investment objective is to provide a high level of current income,
consistent with modest growth of capital, for holders of its Common Shares of
beneficial interest. The Fund will pursue its objective by investing in a
diversified portfolio of dividend paying preferred and common stocks of
domestic and foreign issuers, as well as debt obligations, with the Fund
investing only in U.S. dollar denominated securities.
The Fund's non-fundamental investment policy with respect to the
quality of ratings of its portfolio investments was changed by a vote of the
Fund's Trustees on September 13, 1994. The new policy, which became effective
October 15, 1994, stipulates that preferred stocks and debt obligations in
which the Fund will invest will be rated investment grade (at least "BBB" by
S&P or "Baa" by Moody's) at the time of investment or will be preferred
stocks of issuers of investment grade senior debt, some of which may have
speculative characteristics, or, if not rated, will be of comparable quality
as determined by the Adviser. The Fund will invest in common stocks of
issuers whose senior debt is rated investment grade or, in the case of
issuers that have no rated senior debt outstanding, whose senior debt is
considered by the Adviser to be of comparable quality. The new policy
supersedes the requirement that at least 80% of the Fund's total assets
consist of preferred stocks and debt obligations rated "A" or higher and
dividend paying common stocks whose issuers have senior debt rated "A" or
higher.
DIVIDEND REINVESTMENT PLAN
The Fund provides shareholders with a Dividend Reinvestment Plan (the "Plan")
which offers the opportunity to earn compounded yields. Each holder of Common
Shares will automatically have all distributions of dividends and capital
gains reinvested by State Street Bank and Trust Company, 225 Franklin Street,
Boston, Massachusetts 02210, as agent for the common shareholders, unless an
election is made to receive cash. Holders of Common Shares who elect not to
participate in the Plan will receive all distributions in cash, paid by
check, mailed directly to the shareholder of record (or if the Common Shares
are held in street or other nominee name then to the nominee) by the Plan
Agent, as dividend disbursing agent. Shareholders whose shares are held in
the name of a broker or nominee should contact the broker or nominee to
determine whether and how they may participate in the Plan.
The Plan Agent serves as agent for the holders of Common Shares in
administering the Plan. After the Fund declares a dividend or makes a capital
gain distribution, the Plan Agent will, as agent for the participants,
receive the cash payment and use it to buy Common Shares in the open market,
on the New York Stock Exchange or elsewhere, for the participants' accounts.
The Fund will not issue any new shares in connection with the Plan.
Participants in the Plan may withdraw from the Plan upon written
notice to the Plan Agent. Such withdrawal will be effective immediately if
received not less than ten days prior to a dividend record date; otherwise,
it will be effective for all subsequent dividend record dates. When a
participant withdraws from the Plan or upon termination of the Plan as
provided below, certificates for whole Common Shares credited to his or her
account under the Plan will be issued and a cash payment will be made for any
fraction of a share credited to such account.
The Plan Agent maintains each shareholder's account in the Plan and
furnishes monthly written confirmations of all transactions in the accounts,
including information needed by the shareholders for personal and tax
records. Common Shares in the account of each Plan participant will be held
by the Plan Agent in non-certificated form in the name of the participant.
Proxy material relating the shareholder's meetings of the Fund will include
those shares purchased as well as shares held pursuant to the Plan.
The Plan Agent's fees for the handling of reinvestment of dividends
and other distributions will be paid by the Fund. Each participant will pay a
pro rata share of brokerage commissions incurred with respect to the Plan
Agent's open market purchases in connection with the reinvestment of
dividends and distributions. The cost per share of the shares purchased for
each participant's account will be the average cost, including brokerage
commissions, of any shares purchased on the open
16
<PAGE> 17
John Hancock Funds - Patriot Global Dividend Fund
market. There are no other charges to participants for reinvesting dividends
or capital gain distributions, except for certain brokerage commissions, as
described above.
The automatic reinvestment of dividends and distributions will not
relieve participants of any federal income tax that may be payable or
required to be withheld on such dividends or distributions.
Experience under the Plan may indicate that changes are desirable.
Accordingly, the Fund reserves the right to amend or terminate the Plan as
applied to any dividend or distribution paid subsequent to written notice of
the change sent to all shareholders of the Fund at least 90 days before the
record date for the dividend or distribution. The Plan may be amended or
terminated by the Plan Agent at least 90 days after written notice to all
shareholders of the Fund. All correspondence or additional information
concerning the Plan should be directed to the Plan Agent, State Street Bank
and Trust Company, at P.O. Box 8209, Boston, Massachusetts 02266-8209
(telephone 1-800-426-5523).
17
<PAGE> 18
NOTES
John Hancock Funds - Patriot Global Dividend Fund
18
<PAGE> 19
NOTES
John Hancock Funds - Patriot Global Dividend Fund
19
<PAGE> 20
Back Cover
A 1/2" by 1/2" John Hancock Funds logo in upper left hand
corner of the page. A box sectioned in quadrants with a
triangle in upper left, a circle in upper right, a cube in
lower left and a diamond in lower right. A tag line below
reads: "A Global Investment Management Firm."
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