UAM FUNDS TRUST, N-30D, 2000-01-07

UAM FUNDS TRUST
N-30D, 2000-01-07

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<PAGE>

UAM Funds
Funds for the Informed Investor(SM)

NWQ Special Equity Portfolio

UAM
<PAGE>

UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
October 31, 1999

- --------------------------------------------------------------------------------
TABLE OF CONTENTS
- --------------------------------------------------------------------------------

Shareholders' Letter ...................................................... 1

Portfolio of Investments .................................................. 5

Statement of Assets and Liabilities ....................................... 8

Statement of Operations ................................................... 9

Statement of Changes in Net Assets ........................................ 10

Financial Highlights ...................................................... 11

Notes to Financial Statements ............................................. 12

Report of Independent Accountants ......................................... 18

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<PAGE>

UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO

- --------------------------------------------------------------------------------

October 31, 1999

Dear Shareholders,

The Special Equity Portfolio performed strongly throughout the first nine
months, however, a difficult market environment during the summer months
impacted full year results. Results for the fiscal year ending October 31, 1999
closed with the Institutional Class shares gaining 19.3% and Institutional
Service Class shares gaining 18.8%. The overall market, as measured by the S&P
500 Index, performed 25.6% for the same period, compared to 21.1% for the S&P
Midcap 400 Index. Calendar year-to-date, with a return of 11.7% for the
Institutional Service Class and 12.1% for the Institutional Class, the Special
Equity Portfolio compared favorably to the S&P 500 Index return of 12.0%, while
significantly outperforming the S&P Midcap 400 Index return of 2.9%.

This fiscal year proved to be an extremely exciting period for the Special
Equity Portfolio. Various portfolio holdings received takeover offers during the
year, including At Entertainment, Case Corp., Cellular Communications
International, Cellular Communications Puerto Rico, Provident, and cable giant
MediaOne Group. We witnessed strong contributions to the portfolio by way of
investments in Mandalay Resort Group, Columbia HCA Healthcare, and Indymac
Mortgage Holdings as well as other individual stock selections in the energy and
financial sectors. By far our most impressive investments during the year have
been our holdings in the telecommunication and media industries. Propelled by
industry consolidation, growth in wireless penetration, and the cable industry's
broadband value, these industries may not have generated the same media
attention as the Internet start-ups during the year, but have nonetheless
produced comparable returns for investors with less risk. Our most notable
investments in these industries include AT&T Liberty Media Group, Cox
Communications, NTL, Telephone & Data Systems, and our second largest portfolio
holding, CoreComm Limited. CoreComm has appreciated over 390 percent in the last
twelve-month period. These factors contributed to the Special Equity Portfolio
outperforming its benchmarks for the first nine months of the fiscal year.

However, as mentioned briefly above, the final three months of the fiscal year
proved to be a difficult period for the Special Equity Portfolio. Prompted by
two interest rate hikes by the Federal Reserve, the stock market became very
narrow with leadership focused almost exclusively on a small number of very high
p/e

1
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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO

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stocks, primarily in the technology sector. Hardest hit by this market
environment were our financial holdings, which declined due to higher interest
rates, asset quality, and competition fears. Another factor in the Fund's
underperformance during the period was the poor performance of several core
holdings including Waste Management, Aetna, Philip Morris, and Loews. Waste
Management's stock dropped precipitously when it was revealed that the company
was facing unforeseen integration problems from its recent merger with USA
Waste. During the stock's initial decline, we felt that the market's response
was an overreaction. In hindsight, our analysis was incorrect. However, we are
encouraged by the strong actions that the company's board of directors has taken
and believe that the necessary steps for a considerable recovery are in place.
Lastly, our holdings in Philip Morris and Loews performed poorly given ongoing
litigation uncertainty regarding tobacco liability. We continue to believe,
however, that both companies offer absolutely compelling valuations and believe
that the courts will continue to find tobaccorelated class action lawsuits
without merit.

The Special Equity Portfolio strategy continues to focus on undervalued
securities where there are catalysts present or developing, such as management
restructuring or industry consolidation, to improve profitability and recognize
value.

As of October 31, 1999, the portfolio held (as a percent of market value) 95.8%
equities and 4.2% cash equivalents. The top ten holdings in the Fund as of
October 31, 1999 are as follows:

Telephone & Data Systems ............................................... 6.11%
CoreComm ............................................................... 5.74%
AT&T Liberty Media Group ............................................... 5.48%
NTL .................................................................... 5.00%
Cox Communications ..................................................... 3.21%
MediaOne Group ......................................................... 3.14%
Loews .................................................................. 3.04%
Columbia/HCA Healthcare ................................................ 2.88%
Praxair ................................................................ 2.69%
Chase Manhattan Bank ................................................... 2.63%

Sincerely,

NWQ Investment Management Co.

2
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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO

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The investment results presented in this report represent past performance and
should not be construed as a guarantee of future results. A portfolio's
performance assumes the reinvestment of all dividends and distributions. There
are no assurances that a portfolio will meet its stated objectives. The
investment return and principal value of an investment will fluctuate so that an
investor's shares, when redeemed, may be worth more or less than their original
cost. A portfolio's holdings are subject to change because it is actively
managed. Portfolio changes should not be considered recommendations for action
by individual investors.

Definition of the Comparative Indices
-------------------------------------

Standard & Poor's Midcap 400 Index consists of 400 domestic stocks chosen for
market size (medium market capitalization of approximately $700 million),
liquidity, and industry group representation. It is a market-value weighted
index with each stock affecting the index in proportion to its market value.

Standard & Poor's 500 Index is an unmanaged index composed of 400 industrial
stocks, 40 financial stocks, 40 utility stocks and 20 transportation stocks.

The comparative indices assume reinvestment of dividends and, unlike a
portfolio's returns, do not reflect any fees or expenses. If such fees were
reflected in the comparative indices' returns, the performance would have been
lower. Please note that one cannot invest directly in an unmanaged index.

3
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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO

Growth of a $10,000 Investment

- --------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN**
FOR THE PERIOD ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
Institutional Class Shares Institutional Service Class Shares
- --------------------------------------------------------------------------------
1 Since 1 Since
Year 11/4/97* Year 11/7/97*
- --------------------------------------------------------------------------------
19.33% 9.29% 18.79% 9.41%
- --------------------------------------------------------------------------------

[LINE GRAPH]

NWQ S&P
11/7/97 10,000 10,000
Oct-98 10,061 12,200
Oct-99 11,951 15,332

* Beginning of operations. Index comparisons begin on 10/31/97.

** If the adviser and/or portfolio service providers had not limited certain
expenses, the portfolio's total return would have been lower.

+ The graph presents the performance of the Institutional Class shares. The
performance of the Institutional Service Class Shares will vary based upon
the different inception date and fees (including 12b-1 fees) assessed to
that class.

The investment results represent past performance and should not be construed as
a guarantee of future results. The investment return and principal value of an
investment will fluctuate so that an investor's shares, when redeemed, may be
worth more or less than their original cost.

The comparative index assumes reinvestment of dividends and, unlike a
portfolio's returns, does not reflect any fees or expenses. If such fees and
expenses were reflected in the comparative index's returns, the performance
would have been lower.

See definition of comparative indices on page 3.

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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
October 31, 1999
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- --------------------------------------------------------------------------------
PORTFOLIO OF INVESTMENTS
COMMON STOCKS -- 95.4%
- --------------------------------------------------------------------------------

Shares Value
-------- -------
AIR TRANSPORTATION -- 1.6%
Delta Air Lines .................................. 6,800 $ 370,175
----------

BASIC MATERIALS -- 4.0%
Lyondell Chemical ................................ 23,800 288,575
Praxair .......................................... 13,000 607,750
----------
896,325
----------
BROADCASTING & PUBLISHING -- 2.6%
E.W. Scripps, Cl A (The) ......................... 12,500 577,344
----------
CAPITAL EQUIPMENT -- 3.0%
Case ............................................. 8,500 450,500
New Holland ...................................... 15,000 227,813
----------
678,313
----------
CONSUMER DISCRETIONARY -- 17.6%
AT&T Liberty Media Group, Cl A* .................. 31,238 1,239,758
Cox Communications, Cl A* ........................ 16,000 727,000
Ford Motor ....................................... 10,800 592,650
Hasbro ........................................... 18,500 381,563
Mandalay Resort Group* ........................... 17,500 325,937
MediaOne Group* .................................. 10,000 710,625
----------
3,977,533
----------
CONSUMER STAPLES -- 3.7%
Nabisco Group Holdings ........................... 29,000 371,562
Philip Morris .................................... 18,800 473,525
----------
845,087
----------
ENERGY -- 6.8%
BJ Services* ..................................... 15,000 514,688
Ocean Energy* .................................... 28,319 260,181
Tosco ............................................ 16,400 415,125
Transocean Offshore .............................. 13,075 355,477
----------
1,545,471
----------

The accompanying notes are an integral part of the financial statements.

5
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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
October 31, 1999
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- --------------------------------------------------------------------------------
COMMON STOCKS -- 95.4%
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Shares Value
-------- -------
ENVIRONMENT CONTROLS -- 1.1%
Waste Management .............................. 14,000 $ 257,250
----------

FINANCIAL SERVICES -- 23.3%
Bank of America ............................... 8,667 557,938
Bank One ...................................... 10,500 394,406
Chase Manhattan Bank .......................... 6,800 594,150
First Union ................................... 9,500 405,531
Hartford Financial Services Group ............. 11,300 585,481
Heller Financial .............................. 18,000 427,500
Indymac Mortgage Holdings ..................... 26,000 362,375
MGIC Investment ............................... 9,900 591,525
Torchmark ..................................... 14,000 436,625
UnionBanCal ................................... 5,000 217,187
Unumprovident ................................. 10,001 329,408
Waddell & Reed Financial, Cl .................. 15,654 375,696
----------
5,277,822
----------
HEALTH CARE -- 4.8%
Aetna ......................................... 8,800 442,200
Columbia/HCA Healthcare ....................... 27,000 651,375
----------
1,093,575
----------
MISCELLANEOUS -- 1.1%
Tenneco ....................................... 16,000 256,000
----------
MULTI-INDUSTRY -- 3.1%
Loews ......................................... 9,700 687,487
----------
TECHNOLOGY -- 4.2%
Galileo International ......................... 13,000 390,813
Quantum Dlt & Storage* ........................ 20,000 308,750
Quantum Hard Diskdrive* ....................... 40,000 245,000
----------
944,563
----------

The accompanying notes are an integral part of the financial statements.

6
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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
October 31, 1999
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COMMON STOCKS -- continued
- --------------------------------------------------------------------------------

Shares Value
-------- -------

TELECOMMUNICATIONS -- 16.9%
CoreComm* .................................... 33,000 $ 1,299,375
NTL* ......................................... 15,000 1,130,625
Telephone & Data Systems ..................... 12,000 1,383,000
-----------
3,813,000
-----------

TRANSPORTATION -- 1.6%
Lear* ........................................ 10,500 354,375
-----------

TOTAL COMMON STOCKS
(Cost $19,194,988) ......................... 21,574,320
-----------

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SHORT-TERM INVESTMENT -- 4.2%
- -------------------------------------------------------------------------------
Face
Amount
--------
REPURCHASE AGREEMENT -- 4.2%

Chase Securities, Inc. 5.15%, dated 10/29/99,
due 11/01/99, to be repurchased at $945,406,
collateralized by $948,215 of various U.S.
Treasury Bills and U.S. Treasury Notes, valued
at $945,026 (Cost $945,000) .................. $945,000 945,000
-----------
TOTAL INVESTMENTS -- 99.6%
(Cost $20,139,988) (a) ..................... 22,519,320
-----------
OTHER ASSETS AND LIABILITIES (NET) -- 0.4% ... 101,059
-----------
TOTAL NET ASSETS -- 100.0% ................... $22,620,379
===========

* Non-Income Producing Security

Cl Class

(a) The cost for federal income tax purposes was $20,186,748. At October 31,
1999, net unrealized appreciation for all securities based on tax cost was
$2,332,572. This consisted of aggregate gross unrealized appreciation for
all securities of $5,249,817, and gross unrealized depreciation for all
securities of $2,917,245.

The accompanying notes are an integral part of the financial statements.

7
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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
October 31, 1999
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS & LIABILITIES
- --------------------------------------------------------------------------------

Assets
Investments, at Cost ............................................ $20,139,988
===========

Investments, at Value -- Note A ................................ $22,519,320
Cash ............................................................ 564
Receivable for Investments Sold ................................. 99,917
Receivable for Portfolio Shares Sold ............................ 6,467
Dividends Receivable ............................................ 34,757
Interest Receivable ............................................. 406
Other Assets .................................................... 2,214
-----------
Total Assets .................................................. 22,663,645
-----------
Liabilities
Payable for Portfolio Shares Redeemed ........................... 1,508
Payable for Investment Advisory Fees -- Note B .................. 4,994
Payable for Administrative Fees -- Note C ....................... 13,627
Payable for Custodian Fees -- Note D ............................ 1,053
Payable for Distribution and Service Fees -- Note E ............. 1,954
Payable for Directors' Fees -- Note G ........................... 656
Other Liabilities ............................................... 19,474
-----------
Total Liabilities ............................................. 43,266
-----------
Net Assets ...................................................... $22,620,379
===========

Net Assets Consist of:
Paid in Capital ................................................. $20,073,826
Undistributed Net Investment Income ............................. 15,317
Accumulated Net Realized Gain ................................... 151,904
Unrealized Appreciation ......................................... 2,379,332
-----------
Net Assets ...................................................... $22,620,379
===========

Institutional Class Shares
Net Assets ...................................................... $16,405,773
Shares Issued and Outstanding ($0.001 par value)
(Authorized 25,000,000) ....................................... 1,385,212
Net Asset Value, Offering and Redemption Price Per Share ........ $11.84
======

Institutional Service Class Shares
Net Assets ...................................................... $6,214,606
Shares Issued and Outstanding ($0.001 par value)
(Authorized 10,000,000) .................................... 527,807
Net Asset Value, Offering and Redemption Price Per Share ........ $11.77
======

The accompanying notes are an integral part of the financial statements.

8
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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
FOR THE YEAR ENDED OCTOBER 31, 1999
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
- --------------------------------------------------------------------------------

Investment Income
Dividends ....................................................... $ 273,990
Interest ........................................................ 49,751
----------
Total Income .................................................. 323,741
----------
Expenses
Investment Advisory Fees -- Note B .............................. 185,627
Administrative Fees -- Note C ................................... 111,951
Distribution and Service Plan Fees -- Note E .................... 23,610
Registration and Filing Fees .................................... 21,427
Audit Fees ...................................................... 12,609
Printing Fees ................................................... 12,126
Custodian Fees -- Note D ........................................ 6,243
Directors' Fees -- Note G ....................................... 2,836
Legal Fees ...................................................... 2,133
Other Expenses .................................................. 16,576
Investment Advisory Fees Waived -- Note B ....................... (104,737)
----------
Net Expenses Before Expense Offset ............................ 290,401
----------
Expense Offset -- Note A ........................................ (206)
----------
Net Expenses After Expense Offset ............................. 290,195
----------
Net Investment Income ........................................... 33,546
----------
Net Realized Gain on Investments ................................ 198,664
Net Change in Unrealized Appreciation (Depreciation)
on Investments ................................................ 3,470,623
----------
Net Gain on Investments ......................................... 3,669,287
----------
Net Increase in Net Assets Resulting from Operations ............ $3,702,833
==========

The accompanying notes are an integral part of the financial statements.

9
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November 4,
Year Ended 1997* to
October 31, October 31,
1999 1998
------------ ------------
<S> <C> <C>
Increase (Decrease) in Net Assets
Operations:
Net Investment Income ......................................... $ 33,546 $ 21,108
Net Realized Gain ............................................. 198,664 52,129
Net Change in Unrealized Appreciation (Depreciation) .......... 3,470,623 (1,091,291)
------------ ------------
Net Increase (Decrease) in Net Assets Resulting from
Operations .................................................. 3,702,833 (1,018,054)
------------ ------------
Distributions:
Net Investment Income:
Institutional Class ........................................... (39,254) --
Net Realized Gain:
Institutional Class ........................................... (72,678) --
Institutional Service Class ................................... (26,294) --
------------ ------------
Total Distributions ......................................... (138,226) --
------------ ------------
Capital Share Transactions (Note J):
Institutional Class:
Issued ........................................................ 3,055,473 15,803,298
In Lieu of Cash Distributions ................................. 111,770 --
Redeemed ...................................................... (3,565,829) (370,338)
------------ ------------
Net Increase (Decrease) from Institutional Class Shares ....... (398,586) 15,432,960
------------ ------------
Institutional Service Class**:
Issued ........................................................ 716,554 5,204,484
In Lieu of Cash Distributions ................................. 26,240 --
Redeemed ...................................................... (456,306) (451,520)
------------ ------------
Net Increase from Institutional Service Class Shares .......... 286,488 4,752,964
------------ ------------
Net Increase (Decrease) from Capital Share Transactions ....... (112,098) 20,185,924
------------ ------------
Total Increase .................................................. 3,452,509 19,167,870
Net Assets:
Beginning of Period ........................................... 19,167,870 --
------------ ------------
End of Period (including undistributed net investment income of
$15,317 and $21,108, respectively) .......................... $ 22,620,379 $ 19,167,870
============ ============
</TABLE>
* Commencement of Operations
** Initial offering of Institutional Service Class Shares began on November 7,
1997.

The accompanying notes are an integral part of the financial statements.

10
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Institutional Institutional Service
Class Shares Class Shares
------------------------ -------------------------
November 4, November 7,
Year Ended 1997** to Year Ended 1997 *** to
October 31, October 31, October 31, October 31,
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net Asset Value, Beginning
of Period ......................... $ 10.01 $ 10.00 $ 9.96 $ 9.90
-------- -------- ------- -------
Income from Investment
Operations
Net Investment Income (Loss) ...... 0.03 0.02 (0.02) (0.01)
Net Realized and
Unrealized Gain (Loss) .......... 1.88 (0.01)@ 1.88 0.07@
-------- -------- ------- -------
Total from Investment
Operations ...................... 1.91 0.01 1.86 0.06
-------- -------- ------- -------
Distributions
Net Investment Income ............. (0.03) -- -- --
Net Realized Gain ................. (0.05) -- (0.05) --
-------- -------- ------- -------
Total Distributions ............... (0.08) -- (0.05) --
-------- -------- ------- -------

Net Asset Value, End of
Period ............................ $ 11.84 $ 10.01 $ 11.77 $ 9.96
======== ======== ======= =======

Total Return ........................ 19.33% 0.10%++ 18.79% 0.61%++
======== ======== ======= =======

Ratios and Supplemental Data
Net Assets, End of Period
(Thousands) ....................... $ 16,406 $ 14,167 $ 6,215 $ 5,001
Ratio of Expenses to Average
Net Assets ........................ 1.22% 1.16%* 1.62% 1.56%*
Ratio of Net Investment Income (Loss)
to Average Net Assets ............. 0.26% 0.42%* (0.14)% (0.16)%*
Portfolio Turnover Rate ............. 26% 23% 26% 23%
</TABLE>
* Annualized
** Commencement of Operations
*** Initial offering of Institutional Service Class shares.
+ Total return would have been lower had the Adviser not waived and assumed
certain expenses during the periods indicated.
++ Not Annualized
@ The amounts shown for a share outstanding throughout the period do not
accord with aggregate net losses on investments for the period because of
the timing of sales and repurchases of the portfolio shares in relation to
fluctuating market value of the investments in the Portfolio.

The accompanying notes are an integral part of the financial statements.

11
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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
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NOTES TO FINANCIAL STATEMENTS
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UAM Funds, Inc., UAM Funds, Inc. II and UAM Funds Trust (collectively the
"UAM Funds") are registered under the Investment Company Act of 1940, as
amended. The NWQ Special Equity Portfolio (the "Portfolio"), a portfolio of UAM
Funds Inc., is a diversified, open-end management investment company. At October
31, 1999, the UAM Funds were composed of 48 active portfolios. The information
presented in the financial statements pertains only to the Portfolio. The
Portfolio currently offers two separate classes of shares-Institutional Class
Shares and Institutional Service Class Shares ("Service Class Shares"). Both
classes of shares have identical voting rights (except Service Class
shareholders have exclusive voting rights with respect to matters relating to
distributions and shareholder servicing of such shares), dividend, liquidation
and other rights. The objective of the Portfolio is to seek long-term capital
appreciation by investing primarily in the common stock and other equity
securities of companies which, in the Adviser's opinion, are undervalued at the
time of purchase and offer the potential for above-average capital appreciation.

A. Significant Accounting Policies: The following significant accounting
policies are in conformity with generally accepted accounting principles. Such
policies are consistently followed by the Portfolio in the preparation of its
financial statements. Generally accepted accounting principles may require
Management to make estimates and assumptions that affect the reported amounts
and disclosures in the financial statements. Actual results may differ from
those estimates.

1. Security Valuation: Investments for which market quotations are
readily available are stated at market value, which is determined using the
last reported sale price from the exchange where the security is primarily
traded. If no sales are reported, as in the case of some securities traded
over-the-counter, the market value is determined using the last reported
bid price. Short-term investments with maturities of sixty days or less at
time of purchase are valued at amortized cost, if it approximates market
value. The value of other assets and securities for which no quotations are
readily available is determined in good faith at fair value following
procedures approved by the Board of Directors.

2. Federal Income Taxes: It is the Portfolio's intention to qualify as
a regulated investment company under Subchapter M of the Internal Revenue
Code and to distribute all of its taxable income. Accordingly, no provision
for Federal income taxes is required in the financial statements.

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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
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3. Repurchase Agreements: In connection with transactions involving
repurchase agreements, the Portfolio's custodian bank takes possession of
the underlying securities ("collateral"), the value of which exceeds the
principal amount of the repurchase transaction, including accrued interest.
To the extent that any repurchase transaction exceeds one business day, the
value of the collateral is monitored on a daily basis to determine the
adequacy of the collateral. In the event of default on the obligation to
repurchase, the Portfolio has the right to liquidate the collateral and
apply the proceeds in satisfaction of the obligation. In the event of
default or bankruptcy by the counterparty to the agreement, realization
and/or retention of the collateral or proceeds may be subject to legal
proceedings.

Pursuant to an Exemptive Order issued by the Securities and Exchange
Commission, the UAM Funds may transfer their daily uninvested cash balances
into a joint trading account which invests in one or more repurchase
agreements. This joint repurchase agreement is covered by the same
collateral requirements as discussed above.

4. Distributions to Shareholders: The Portfolio will distribute
substantially all of its net investment income quarterly. Any realized net
capital gains will be distributed annually. All distributions are recorded
on ex-dividend date.

The amount and character of income and capital gain distributions to
be paid are determined in accordance with Federal income tax regulations
which may differ from generally accepted accounting principles.

Permanent book and tax basis differences relating to shareholder
distributions resulted in reclassifications of $(83) to undistributed net
investment income and $83 to accumulated net realized gain.

Permanent book-tax differences, if any, are not included in ending
undistributed net investment income (loss) for the purpose of calculating
net investment income (loss) per share in the financial highlights.

5. Other: Security transactions are accounted for on trade date, the
date the trade is executed. Costs used in determining realized gains or
losses on the sale of investment securities are based on the specific
identification method. Dividend income is recorded on the ex-dividend date.
Interest income is recognized on the accrual basis. Most expenses of the
UAM Funds can be directly attributed to a particular portfolio. Expenses
that cannot be directly attributed to a portfolio or share class are
apportioned among the portfolios of the UAM Funds based on their relative
net assets. Income, expenses (other than

13
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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
- --------------------------------------------------------------------------------

class specific expenses) and realized and unrealized gains and losses are
allocated to each class of shares based upon their relative net assets.
Custodian fees for the Portfolio are shown gross of expense offsets, if
any, for custodian balance credits.

B. Investment Advisory Services: Under the terms of an investment advisory
agreement, NWQ Investment Management Company (the "Adviser"), a subsidiary of
United Asset Management Corporation ("UAM"), provides investment advisory
services to the Portfolio for a monthly fee calculated at an annual rate of
0.85% of average daily net assets for the month.

The Adviser has voluntarily agreed to waive a portion of its advisory fees
and to assume expenses, if necessary, in order to keep the total annual
operating expenses, after the effect of expense offset arrangements, from
exceeding 1.25% of average net assets of the Portfolio's Institutional Class
Shares and 1.65% of the average net assets of the Portfolio's Institutional
Service Class Shares.

Effective March 1, 1999, the Adviser increased the expense limitations of
the Portfolio. Prior to March 1, 1999, the expense limitations were 1.15% and
1.55%, for the Portfolio's Institutional Class Shares and the Portfolio's
Institutional Service Class Shares, respectively.

C. Administrative Services: UAM Fund Services, Inc. (the "Administrator"),
a wholly-owned subsidiary of UAM, provides and oversees administrative, fund
accounting, dividend disbursing, shareholder servicing and transfer agent
services to the Portfolio under a Fund Administration Agreement (the
"Agreement"). The Administrator has entered into separate Service Agreements
with Chase Global Funds Services Company ("CGFSC"), a corporate affiliate of The
Chase Manhattan Bank, DST Systems, Inc. ("DST"), and UAM Shareholder Service
Center ("UAMSSC"), an affiliate of UAM, to assist in providing certain services
to the Portfolio.

Pursuant to the Agreement, the Portfolio pays the Administrator 0.079% per
annum of the average daily net assets of the Portfolio, an annual base fee of no
more than $113,500, and a fee based on the number of active shareholder
accounts.

For the year ended October 31, 1999, the Administrator was paid $111,951,
of which $58,223 was paid to CGFSC for their services, $25,845 to DST for their
services, and $11,647 to UAMSSC for their services.

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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
- --------------------------------------------------------------------------------

Effective November 1, 1999, the UAM Funds' Board of Directors approved a
change in the Sub-administrator from CGFSC to SEI Investments Mutual Funds
Services.

D. Custodian: The Chase Manhattan Bank is custodian for the Portfolio's
assets held in accordance with the custodian agreement.

E. Distribution Services: UAM Fund Distributors, Inc. (the "Distributor"),
a wholly-owned subsidiary of UAM, distributes the shares of the Portfolio. The
Distributor does not receive any fee or any other compensation with respect to
the Portfolio.

The Portfolio has adopted a Distribution and Service Plan (the "Plan") on
behalf of the Service Class Shares pursuant to Rule 12b-1 under the Investment
Company Act of 1940. Under the Plan, the Service Class Shares may not incur
distribution and service fees which exceed an annual rate of 0.75% of average
net assets of that class of shares, however, the Board has currently limited
aggregate payments under the Plans to 0.50% per annum of the Service Class
Share's average net assets. The Portfolio's Service Class Shares are currently
making payments for distribution fees at 0.15% of average daily net assets.

In addition, the Portfolio's Service Class Shares pay service fees at an
annual rate of 0.25% of the average daily value of the Portfolio's Service Class
Shares owned by clients of the Service Agents.

F. Account Services: Through January 1, 1999, the UAM Funds had contracted
with UAM Retirement Plan Services, Inc. ("The Service Provider"), a wholly owned
subsidiary of UAM to perform certain services for participants in a
self-directed, defined contribution plan, and for whom the Service Provider
provided participant recordkeeping. Pursuant to the terms of the agreement, the
Service Provider was entitled to receive, after the end of each month, a fee at
the annual rate of 0.15% of the average aggregate daily net asset value of
shares of the UAM Funds in the accounts for which they provide services. The
agreement was terminated effective January 1, 1999.

G. Directors' Fees: Each Director, who is not an officer or affiliated
person, receives $2,000 per meeting attended plus reimbursement of expenses
incurred in attending Board meetings which is allocated proportionally among the
active portfolios of UAM Funds, plus a quarterly retainer of $150 for each
active portfolio of the UAM Funds.

15
<PAGE>

UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
- --------------------------------------------------------------------------------
H. Purchases and Sales: For the year ended October 31, 1999, purchases and
sales of investment securities other than long-term U.S. Government securities
and short-term securities were $5,990,356 and $5,416,627, respectively.

There were no purchases or sales of long-term U.S. Government securities.

I. Line of Credit: The Portfolio, along with certain other Portfolios of
UAM Funds, collectively entered into an agreement which enables them to
participate in a $100 million unsecured line of credit with several banks.
Borrowings will be made solely to temporarily finance the repurchase of capital
shares. Interest is charged to each participating portfolio based on its
borrowings at a rate per annum equal to the Federal Funds rate plus 0.50%. In
addition, a commitment fee of 0.08% per annum, payable at the end of each
calendar quarter, is accrued by each participating portfolio based on its
average daily unused portion of the line of credit. During the year ended
October 31, 1999, the Portfolio had no borrowings under the agreement.

J. Capital Share Transactions: Transactions in capital shares for the
Portfolio, by class, were as follows:

Institutional
Institutional Class Shares Service Class Shares
--------------------------- ---------------------------
Year November 4, Year November 7,
Ended 1997* to Ended 1997** to
October 31, October 31, October 31, October 31,
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Shares Issued .................. 262,370 1,452,726 63,377 544,632
In Lieu of Cash Distributions .. 10,788 -- 2,611 --
Shares Redeemed ................ (303,710) (36,962) (40,115) (42,698)
------- --------- ------ -------
Net Increase from Capital
Share Transactions ........... (30,552) 1,415,764 25,873 501,934
====== ========= ====== =======
</TABLE>
* Commencement of operations.
** Initial offering of Institutional Service Class Shares.

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UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
- --------------------------------------------------------------------------------

K. Other:

At October 31, 1999, the percentage of total shares outstanding held by
record shareholders each owning 10% or greater of the aggregate total shares
outstanding for the Portfolio was as follows:

No. of %
Shareholders Ownership
------------ ---------
Institutional Class..................... 2 77%
Institutional Service Class............. 3 86%

17
<PAGE>

To the Board of Directors of
UAM Funds, Inc. and Shareholders of
NWQ Special Equity Portfolio

In our opinion, the accompanying statement of assets and liabilities, including
the portfolio of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of NWQ Special Equity Portfolio (the
"Portfolio") a portfolio of the UAM Funds, Inc., at October 31, 1999, and the
results of its operations for the year then ended, the changes in its net assets
and the financial highlights for the periods indicated, in conformity with
generally accepted accounting principles. These financial statements and
financial highlights (hereafter referred to as "financial statements") are the
responsibility of the Portfolio's management; our responsibility is to express
an opinion on these financial statements based on our audits. We conducted our
audits of these financial statements in accordance with generally accepted
auditing standards, which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at October 31, 1999 by
correspondence with the custodian, provide a reasonable basis for the opinion
expressed above.

PricewaterhouseCoopers LLP

Boston, Massachusetts
December 17, 1999

18
<PAGE>

NOTES
<PAGE>

UAM FUNDS NWQ SPECIAL EQUITY PORTFOLIO
- --------------------------------------------------------------------------------
Officers and Directors

Norton H. Reamer Peter M. Whitman, Jr.
Director, President and Chairman Director

John T. Bennett, Jr. William H. Park
Director Vice President

Nancy J. Dunn Michael E. DeFao
Director Secretary

Philip D. English Gary L. French
Director Treasurer

William A. Humenuk Robert R. Flaherty
Director Assistant Treasurer

James P. Pappas Robert J. Della Croce
Director Assistant Treasurer
- --------------------------------------------------------------------------------

UAM Funds
P.O. Box 219081
Kansas City, MO 64121
(toll free)
1-877-UAM-LINK (826-5465)
www.uam.com

Investment Adviser
NWQ Investment Management Company
2049 Century Park East, 4th Floor
Los Angeles, CA 90067

Distributor
UAM Fund Distributors, Inc.
211 Congress Street
Boston, MA 02110

------------------------------------
This report has been prepared for
shareholders and may be distributed
to others only if preceded or
accompanied by a current prospectus.
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