As filed with the Securities and Exchange Commission on March 7, 2002
Securities Act File No. 2-29502

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM N-14

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

Pre-Effective Amendment No.___

Post-Effective Amendment No. ___

(Check appropriate box or boxes)

JOHN HANCOCK CAPITAL SERIES
---------------------------
(Exact Name of Registrant as Specified in Charter)

(617) 375-1702
--------------
(Area Code and Telephone Number)

101 Huntington Avenue, Boston, Massachusetts 02199-7603
-------------------------------------------------------
(Address of Principal Executive Offices: Number, Street, City, State, Zip Code)

Susan S. Newton, Esq.
John Hancock Advisers, LLC
101 Huntington Avenue
Boston, MA 02199
----------------
(Name and address of agent for service)

Title of Securities Being Registered: Shares of beneficial interest of John
Hancock Capital Series.

Approximate Date of Proposed Public Offering: As soon as practicable after the
effectiveness of the registration statement.

No filing fee is required because an indefinite number of shares has previously
been registered pursuant to Rule 24f-2 under the Investment Company Act of 1940,
as amended. This Registration Statement relates to shares previously registered
on Form N-1A (File Nos. 2-29502 and 811-1677).

It is proposed that this filing will become effective on April 5, 2002.

U.S. GLOBAL LEADERS GROWTH FUND
A Series of Professionally Managed Portfolios
630 Fifth Avenue
New York, New York 10111

NOTICE OF MEETING OF SHAREHOLDERS
SCHEDULED FOR MAY 8, 2002

This is the formal agenda for your fund's shareholder meeting. It tells you what
matters will be voted on and the time and place of the meeting, in case you want
to attend in person.

To the shareholders of U.S. Global Leaders Growth Fund ("U.S. Global Leaders
Growth Fund" or "your fund"):

A shareholder meeting for your fund will be held at New York, N.Y., on
Wednesday, May 8, 2002 at 10:00 a.m., Eastern time, to consider the
following:

1. A proposal to approve an Agreement and Plan of Reorganization between your
fund and John Hancock U.S. Global Leaders Growth Fund (the "John Hancock Fund").
Under this Agreement, your fund will transfer all of its assets to the John
Hancock Fund in exchange for Class A shares of the John Hancock Fund, a
newly-created fund with substantially similar investment policies and strategies
as your fund. Class A shares of the John Hancock Fund will be distributed to
your fund's shareholders in proportion to their holdings on the reorganization
date. The John Hancock Fund also will assume your fund's liabilities that are
included in the calculation of your fund's net assets at the closing and
liabilities with respect to your fund's investment operations that are not
required by generally accepted accounting principles to be included in the
calculation of net asset value. Your fund's current investment adviser will act
as sub-adviser to the John Hancock Fund. John Hancock Advisers, LLC will act as
the investment adviser to the John Hancock Fund and has agreed to limit the John
Hancock Fund's total operating expenses for the Class A shares for at least the
next two years to 1.37% of average daily net assets. So, the total operating
expenses of the John Hancock Fund's Class A shares will not be higher than, and
may be lower than, your fund's historical operating expenses. Your board of
trustees recommends that you vote FOR this proposal.

2. Any other business that may properly come before the meeting.

Shareholders of record as of the close of business on March 20, 2002 are
entitled to vote at the meeting and any related follow-up meetings.

Whether or not you expect to attend the meeting, please complete and return the
enclosed proxy card. If shareholders do not return their proxies in sufficient
numbers, the fund may be required to make additional solicitations.

By order of the board of trustees,

[ ]
------------------
Secretary

April 12, 2002

PROXY STATEMENT OF
U.S. GLOBAL LEADERS GROWTH FUND
A Series of Professionally Managed Portfolios
630 Fifth Avenue
New York, New York 10111
1-800-282-2340

PROSPECTUS FOR CLASS A SHARES OF
JOHN HANCOCK U.S. GLOBAL LEADERS GROWTH FUND
(a series of John Hancock Capital Series)
101 Huntington Avenue
Boston, MA 02199
1-800-225-5291

This proxy statement and prospectus contains the information you should know
before voting on the proposed reorganization of your fund into John Hancock U.S.
Global Leaders Growth Fund (the "John Hancock Fund"), an open-end management
investment company. Please read it carefully and retain it for future reference.

How the Reorganization Will Work

o Your fund will transfer all of its assets to the John Hancock Fund. The
John Hancock Fund will assume your fund's liabilities that are included in
the calculation of your fund's net assets at the closing and liabilities
with respect to your fund's investment operations that are not required by
generally accepted accounting principles to be included in the calculation
of net asset value.

o The John Hancock Fund will issue Class A shares to your fund with an
aggregate net asset value equal to the net assets attributable to your
fund's shares. Class A shares of the John Hancock Fund will be distributed
to your fund's shareholders in proportion to their holdings on the
reorganization date. As of the close of the reorganization, you will hold
the same number of shares of the John Hancock Fund as you held in your
fund immediately before the reorganization and that the aggregate net
asset value of such shares will be the same as the net asset value of your
shares of your fund as of the reorganization date.

o Your fund will be liquidated and you will become a shareholder of the John
Hancock Fund.

o John Hancock Advisers, LLC ("JHA") will act as investment adviser to the
John Hancock Fund. Your fund's current investment adviser, Yeager, Wood &
Marshall, Incorporated ("YWM") will act as sub-adviser to the John Hancock
Fund. JHA has agreed to limit the John Hancock Fund's total operating
expenses for Class A shares for at least the next two years to 1.37 % of
average daily net assets. So, the total operating expenses of the John
Hancock Fund's Class A shares will not be higher than, and may be lower
than, your fund's historical operating expenses.

o The reorganization is not intended to result in income, gain or loss for
federal income tax purposes.

An investment in the John Hancock Fund is not a bank deposit and is not insured
or guaranteed by the Federal Deposit Insurance Corporation or any other
government agency.

Shares of the John Hancock Fund have not been approved or disapproved by the
Securities and Exchange Commission. The Securities and Exchange Commission has
not passed upon the accuracy or adequacy of this prospectus. Any representation
to the contrary is a criminal offense.

Why Your Fund's Trustees are Recommending the Reorganization

The trustees (the "trustees") of Professionally Managed Portfolios, a
Massachusetts business trust of which your fund is a series, believe that
reorganizing your fund into an investment company with similar investment
policies that is part of the John Hancock family of funds and is subadvised by
YWM offers you potential benefits. These potential benefits include:

o Continuity of portfolio management, since YWM will be subadviser to the
John Hancock Fund;
o JHA's experience and resources in managing mutual funds;
o A greater potential to attract additional assets, which in the long term
may reduce per share operating expenses;
o JHA's commitment to limit the total operating expenses of Class A shares
of the John Hancock Fund; and

o The exchange privileges offered to shareholders of the John Hancock Fund
and the waiver of sales charges on additional purchases of Class A shares
of the John Hancock Fund.

Therefore, the trustees recommend that your fund's shareholders vote FOR the
reorganization.

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Where to Get More Information
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Your fund's prospectus dated October 29, 2001. In the same envelope as this proxy statement and prospectus. This
prospectus, which is also on file with the Securities and Exchange
Commission ("SEC"), is incorporated by reference into this proxy
statement and prospectus.
- ------------------------------------------------------------------------------------------------------------------------------------
The John Hancock Fund's preliminary prospectus. In the same envelope as this proxy statement and prospectus.This
prospectus, which is also on file with the SEC, is
incorporated by reference into this proxy statement and
prospectus.
- ------------------------------------------------------------------------------------------------------------------------------------
Your fund's annual and semiannual reports to shareholders. Available to you free of charge by calling 1-800-282-2340. Also on
file with the SEC. See "Available Information." These reports are
incorporated by reference into this proxy statement and prospectus.
- ------------------------------------------------------------------------------------------------------------------------------------
A statement of additional information dated April 12, Available to you free of charge by calling 1-800-282-2340. Also on file
2002. It contains additional information about your fund with the SEC. This statement of additional information is incorporated
and the John Hancock Fund. by reference into this proxy statement and prospectus.
- ------------------------------------------------------------------------------------------------------------------------------------
To ask questions about this proxy statement and Call your fund's toll-free telephone number: 1-800-282-2340, or
prospectus. write to the fund c/o Orbitex Data Services, Inc., P.O. Box 542007
Omaha, NE 68154-1952).
- ------------------------------------------------------------------------------------------------------------------------------------

The date of this proxy statement and prospectus is April 12, 2002.

TABLE OF CONTENTS
- --------------------------------------------------------------------------------
Page
- --------------------------------------------------------------------------------
INTRODUCTION
- --------------------------------------------------------------------------------
SUMMARY
- --------------------------------------------------------------------------------
PROPOSAL TO APPROVE AGREEMENT AND PLAN OF REORGANIZATION
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CAPITALIZATION
- --------------------------------------------------------------------------------
BOARDS' EVALUATION AND RECOMMENDATION
- --------------------------------------------------------------------------------
VOTING RIGHTS AND REQUIRED VOTE
- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION ABOUT JOHN HANCOCK U.S. GLOBAL LEADERS
GROWTH FUND
- --------------------------------------------------------------------------------
MATERIAL PROVISIONS OF THE MANAGEMENT CONTRACTS AND THE SUB-INVESTMENT
MANAGEMENT CONTRACT
- --------------------------------------------------------------------------------
JOHN HANCOCK U.S. GLOBAL LEADERS FUND CLASS A RULE 12B-1 PLAN
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
INFORMATION CONCERNING THE MEETING
- --------------------------------------------------------------------------------
OWNERSHIP OF SHARES OF THE FUNDS
- --------------------------------------------------------------------------------
EXPERTS
- --------------------------------------------------------------------------------
AVAILABLE INFORMATION
- --------------------------------------------------------------------------------
EXHIBIT A - AGREEMENT AND PLAN OF REORGANIZATION A-1
- --------------------------------------------------------------------------------

INTRODUCTION

This proxy statement and prospectus is being used by your fund's board of
trustees to solicit proxies to be voted at a special meeting of your fund's
shareholders. This meeting will be held at New York, N.Y. on
Wednesday, May 8, 2002 at 10:00 a.m., Eastern time. The purpose of the
meeting is to consider a proposal to approve an Agreement and Plan of
Reorganization providing for the reorganization of your fund into the John
Hancock Fund, a newly created mutual fund that is not yet operational. You
should understand that if you vote in favor of the reorganization of your fund,
you are approving a reorganization into a class of shares subject to Rule 12b-1
fees, although the effect of the 12b-1 fee on the John Hancock Fund's total
expenses is offset by its lower management fee.

This proxy statement and prospectus is being mailed to your fund's shareholders
on or about April 12, 2002.

Who is Eligible to Vote?

Shareholders of record on March 20, 2002 are entitled to attend and vote at
the meeting or any adjourned meeting. Each share is entitled to one vote. Shares
represented by properly executed proxies, unless revoked before or at the
meeting, will be voted according to shareholders' instructions. If you sign a
proxy but do not fill in a vote, your shares will be voted to approve the
Agreement and Plan of Reorganization. If any other business comes before the
meeting, your shares will be voted at the discretion of the persons named as
proxies.

SUMMARY

The following is a summary of more complete information appearing later in this
proxy statement. You should read carefully the entire proxy statement and the
Agreement and Plan of Reorganization attached as Exhibit A because they contain
details that are not in the summary.

Comparison of U.S. Global Leaders Growth Fund to the John Hancock Fund
- -----------------------------------------------------------------------------------------------------------------------------------
U.S. Global Leaders Growth Fund John Hancock Fund
- -----------------------------------------------------------------------------------------------------------------------------------

Business A non-diversified series of Professionally A newly organized non-diversified series of John
Managed Portfolios, an open-end investment Hancock Capital Series, an open-end investment
management company organized as a management company organized as a Massachusetts
Massachusetts business trust. business trust.
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets as of $84 million None. The John Hancock Fund is newly organized and
December 31, 2001 does not expect to commence investment operations
until after the reorganization occurs.
- -----------------------------------------------------------------------------------------------------------------------------------
Investment advisers and Investment adviser: Investment adviser
portfolio managers Yeager, Wood & Marshall, Incorporated ("YWM") John Hancock Advisers, LLC (as defined above, "JHA")
Portfolio managers:
George M. Yeager Investment subadviser:
George P. Fraise Yeager, Wood & Marshall, Incorporated (as defined
above, "YWM")
Portfolio managers:
George M. Yeager
George P. Fraise
- -----------------------------------------------------------------------------------------------------------------------------------
Investment objectives Each fund seeks long-term growth of capital.

Neither fund can change this objective without shareholder approval.
- -----------------------------------------------------------------------------------------------------------------------------------
Primary investments Your fund invests at least 65% of its assets in The John Hancock Fund invests at least 80% of its
common stocks of U.S. companies that have assets in common stocks of U.S. companies that have
substantial international activities ("U.S. substantial international activities ("U.S. Global
Global Leaders"). Leaders"). Although this percentage is higher than
your fund's percentage, new regulations will require
that your fund also change this percentage to 80% by
July 2002.
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Foreign securities Each fund may invest up to 25% of its net assets in foreign companies, although the level of such
investment is not expected to exceed 15% under normal circumstances.
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Other investment The funds have substantially similar investment policies, strategies and fundamental investment
policies, strategies restrictions.
and restrictions
- -----------------------------------------------------------------------------------------------------------------------------------
Non-diversification Neither fund is diversified for the purpose of the Investment Company Act of 1940 (the "Investment
Company Act"), although each fund is subject to diversification requirements under the Internal Revenue
Code of 1986 (the "Code"). This means that with respect to 50% of its assets, each fund may make larger
investments in individual companies than a fund that is diversified. However, with respect to the other
50% of its assets, each fund may only invest up to 5% of its assets in any individual issuer.
- -----------------------------------------------------------------------------------------------------------------------------------
Sales charges Shares are offered with no sales charges. The Class A Shares of the John Hancock Fund you
receive in the reorganization will not be subject to
any sales charge. Moreover, if you continue to own
shares as of the closing of the reorganization, you
may purchase additional Class A shares of the John
Hancock Fund in the future without paying any sales
charge.
- -----------------------------------------------------------------------------------------------------------------------------------

- -----------------------------------------------------------------------------------------------------------------------------------
U.S. Global Leaders Growth Fund John Hancock Fund
- -----------------------------------------------------------------------------------------------------------------------------------

Except as described above, Class A shares of the John
Hancock Fund are subject to a front-end sales charge of
up to 5.00%. The John Hancock Fund also offers several
other classes of shares which are subject to different
sales charges and 12b-1 fees, as well as a class of
shares for institutional inventory without any sales
charges or 12b-1 fees.
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Management and Your fund pays an advisory fee equal to 1.00% The John Hancock Fund will pay JHA a management fee
administration fees, annually of average daily net assets. In equal to 0.75% annually of average daily net assets,
distribution and addition, your fund pays a separate which is lower than the advisory fee paid to YWM by
service (12b-1) fee and administration fee. U.S. Globals Leaders Growth Fund. JHA pays the fee
overall expenses of YWM as the fund's subadviser to the John Hancock
Shares of your fund are not subject to a 12b-1 Fund.
fee.
Class A shares are subject to a 12b-1 fee equal to
YWM has voluntarily agreed to limit your fund's 0.25% annually of average daily net assets.
ordinary operating expenses to 1.39% of average
daily net assets. This limit may be changed or For a period of at least two years following the
eliminated at any time. During the year ended reorganization, and at least five years if the
June 30, 2001, the fund's total operating Sub-Investment Management Contract with YWM continues
expenses per share were equal to 1.38% of in effect until that date, JHA has agreed to limit
average daily net assets. the John Hancock Fund's ordinary operating expenses
per Class A share to 1.37% of average daily net assets.
- -----------------------------------------------------------------------------------------------------------------------------------
Buying shares You may buy shares directly through your fund's Subject to sales charges if applicable (see "sales
transfer agent as described in detail in your charges" above), you may buy shares through your
fund's prospectus. financial representative or directly through the fund's
transfer agent as described in detail in the John
Hancock Fund's preliminary prospectus.
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Exchange privilege Not applicable. You may exchange shares of the John Hancock Fund
without incurring an exchange fee with the more than
50 other funds in the John Hancock fund family. An
exchange generally is treated as a sale and a new
purchase of shares for federal income tax purposes.
- -----------------------------------------------------------------------------------------------------------------------------------
Redemption fee For your fund, any redemption of shares held for No redemption fee.
less than six months is subject to a redemption
fee of 2.00% of the amount redeemed.
- -----------------------------------------------------------------------------------------------------------------------------------

Comparison of Principal Risks of Investing in the Funds

Because each fund has the same portfolio management and the substantially the
same investment objectives , strategies and policies, the funds are subject to
same principal risks:

The value of an investment in either fund will fluctuate in response to stock
market movements.

The funds' management strategy has a significant influence on fund performance.
Large-capitalization stocks as a group could fall out of favor with the market,
causing the fund to underperform investments that focus on small- or
medium-capitalization stocks. Similarly, growth stocks could underperform value
stocks or otherwise fall out of favor with the markets.

Multinational companies that have substantial international operations may be
affected by fluctuations in currency exchange rates and by economic and
political conditions in foreign countries. These conditions may include
restrictions on monetary repatriation and possible seizure, nationalization or
expropriation of assets. To the extent a fund invests in a given industry, its
performance will be hurt if that industry performs poorly. In addition, if the
managers' security selection strategies do not perform as expected, the fund
could underperform its peers or lose money. Because the funds have the ability
to take larger positions in a small number of issuers, the funds' share prices
may be more volatile than the share price of a diversified fund.

To the extent that a fund makes investments with additional risks, these risks
could increase volatility or reduce performance:

o If a fund invests heavily in a single issuer, its performance could suffer
significantly from adverse events affecting that issuer.

o In a down market, higher-risk securities could become harder to value or
to sell at a fair price.

o Foreign investments carry additional risks, including potentially
unfavorable currency exchange rates, inadequate or inaccurate financial
information and social or political instability.

Investments in the funds are not bank deposits and are not insured or guaranteed
by the Federal Deposit Insurance Corporation or any other government agency. You
could lose money by investing in either fund.

The Reorganization

o The reorganization is scheduled to occur at 5:00 p.m., Eastern time, on
May 17, 2002, but may occur on any later date before July 31, 2002. Your
fund will transfer all of its assets to the John Hancock Fund. The John
Hancock Fund will assume your fund's liabilities that are included in the
calculation of your fund's net assets at the closing and liabilities with
respect to your fund's investment operations that are not required by
generally accepted accounting principles to be included in the calculation
of net asset value. The net asset value of both funds will be computed as
of 4:00 p.m., Eastern time, on the reorganization date.

o The John Hancock Fund will issue to your fund Class A shares with an
aggregate net asset value equal to the net assets attributable to your
fund's shares. These shares will immediately be distributed to your fund's
shareholders in proportion to their holdings on the reorganization date.
As a result, shareholders of your fund will end up as shareholders of the
John Hancock Fund. As of the closing of the reorganization, you will hold
the same number of shares of the John Hancock Fund as you held in U.S.
Global Leaders Growth Fund immediately prior to the reorganization and the
aggregate net asset value of such shares will be the same as the net asset
value of your shares in your fund as of the reorganization date.

o After the distribution of shares, your fund will be liquidated and
terminated as a series of Professionally Managed Portfolios.

o The reorganization is not intended to result in income, gain or loss for
federal income tax purposes and will not take place unless both funds
receive a satisfactory opinion concerning the tax consequences of the
reorganization from Hale and Dorr LLP, counsel to the John Hancock Fund.

Other Consequences of the Reorganization

The funds each pay monthly management fees, and the John Hancock Fund pays Rule
12b-1 fees, equal to the following annual percentages of average daily net
assets:

- --------------------------------------------------------------------------------
U.S. Global Leaders Growth Fund John Hancock Fund John Hancock Fund
Management Fee Management Fee Combined Management Fee and
Class A Rule 12b-1 Fee
- --------------------------------------------------------------------------------
1.00% 0.75% 1.00%
- --------------------------------------------------------------------------------

The annual management fee rate payable by the John Hancock Fund (without giving
effect to expense limitations) is lower than the rate paid by your fund. JHA
will pay YWM its subadvisory fee. In addition to the advisory fee, your fund
pays an administration fee that varies with the size of the fund and was __% of
average daily net assets during the fund's most recent fiscal year. The services
covered by the administration fee are included in JHA's management fee. Although
you may benefit from the John Hancock Fund's reduced management fee rate, you
should understand that if you vote in favor of the reorganization, you are
approving a reorganization into a class of shares subject to a Rule 12b-1 fee.
This fee is equal to 0.25% of the average daily net assets attributable to Class
A shares (i.e., the difference between the two funds' management fees) and
therefore offsets the benefit of the lower management fee.

For its most recent fiscal year, your fund's per share operating expenses were
1.38% of average daily net assets. YWM has voluntarily agreed to limit your
fund's ordinary operating expenses to 1.39% of average daily net assets.
However, unlike the John Hancock Fund's expense limitation, your fund's expense
limitation is not contractual and may be changed or eliminated by YWM at any
time. JHA has agreed to waive, until at least the second anniversary of the
closing of the reorganization and until at least the fifth anniversary if the
Sub-Investment Management Contract remains in effect, all or a portion of its
management fee or reimburse the fund to limit the fund's annual ordinary
operating expenses (other than taxes, interest and extraordinary expenses)
attributable to Class A Shares to 1.37% of average daily net assets. If the John
Hancock Fund's actual operating expenses are less than 1.37% of average daily
net assets due to greater operating efficiencies or economies of scale you will
also benefit from such reduction. Consequently, for at least two years following
the reorganization, the John Hancock Fund's Class A expenses will be lower than
the historic expenses of your fund.

Each Fund's Past Performance

Performance information for the John Hancock Fund is not presented because the
fund has not yet commenced operations. As accounting successor to your fund, the
John Hancock Fund will assume your fund's historical performance after the
reorganization.

Set forth below is performance information for your fund. The following
performance information indicates some of the risks of investing in your fund.
The bar chart shows how your fund's total return has varied from year to year.
The table shows your fund's average annual total return over time compared with
a broad-based market index. This past performance will not necessarily continue
in the future.

Calendar Year Total Returns*

1996 1997 1998 1999 2000 2001
23.14 40.46 31.98 7.88 4.15 -6.38

Your fund's year-to-date return as of 2/28/02 was ____%.

*During the period shown in the bar chart, your fund's highest quarterly return
was [29.43% for the quarter ended December 31, 1998] and the lowest quarterly
return was [-16.69% for the quarter ended September 30, 1998.]

Average Annual Total Returns
as of December 31, 2001

U.S. Global Since Inception
Leaders Growth Fund 1 Year 5 Years (September 29, 1995)
------------------- ------ ------- --------------------

Return before taxes -6.83% 14.17% 16.13%

Return after taxes on -6.83% 14.17% 16.07%
distributions

Return after taxes on -4.16% 11.87% 13.71%
distribution and sale of shares

S&P 500 Index* -11.91% 10.68% 13.13%

*The S&P 500 Index is an unmanaged index generally representative of the market
for stocks of large sized U.S. companies.

After-tax returns are calculated using the historical highest individual federal
marginal income tax rates and do not reflect the impact of state and local
taxes. Actual after-tax returns depend on an investor's tax situation and may
differ from those shown, and after-tax returns shown are not relevant to
investors who hold their Fund shares through tax-deferred arrangements, such as
401(k) plans or individual retirement accounts.

The Funds' Fees and Expenses

Shareholders of both funds pay various fees and expenses, either directly or
indirectly. The table below discusses the fees and expenses that you would pay
if you were to buy and hold shares of each fund. The expenses in the table
appearing below are based on (i) for your fund, the expenses of your fund for
its fiscal year ended June 30, 2001 and (ii) for the John Hancock Fund, the
estimated annual expenses of the John Hancock Fund Class A shares. Future
expenses may be greater or less.

- -------------------------------------------------------------------------------------------------------------------
U.S. Global John Hancock
Leaders Fund
Shareholder transaction fees (paid directly from your investment) Growth Fund Class A
- -------------------------------------------------------------------------------------------------------------------

Maximum sales charge (load) imposed on purchases (as a % of purchase price) none 5.00%(1)
- -------------------------------------------------------------------------------------------------------------------
Maximum deferred sales charge (load) as a % of purchase or sale price, whichever none none
is less
- -------------------------------------------------------------------------------------------------------------------
Maximum Redemption fee(2) as a % of amount redeemed 2.00% none
- -------------------------------------------------------------------------------------------------------------------
Exchange fee as a % of amount exchanged n/a none
- -------------------------------------------------------------------------------------------------------------------

- -------------------------------------------------------------------------------------------------------------------
Annual fund operating expenses (deducted from fund assets) U.S. Global John Hancock
(as a % of average net assets) Leaders Fund
Growth Fund Class A
- -------------------------------------------------------------------------------------------------------------------

Management fee 1.00% 0.75%
- -------------------------------------------------------------------------------------------------------------------
Distribution and service none 0.25%
(12b-1) fee
- -------------------------------------------------------------------------------------------------------------------
Other expenses 0.38% [xx.xx]
- -------------------------------------------------------------------------------------------------------------------
Total fund operating expenses 1.38% [xx.xx]
- -------------------------------------------------------------------------------------------------------------------
Expense reduction (at least two years) n/a [-xx.xx]
- -------------------------------------------------------------------------------------------------------------------
Net fund operating expenses 1.38% 1.37%
- -------------------------------------------------------------------------------------------------------------------

(1) As described above, this sales charge does not apply to shares received in
the reorganization or any subsequent purchases of the John Hancock Fund Class A
shares by shareholders of your fund who become shareholders of the John Hancock
Fund through the reorganization.

(2) The redemption fee applies to those shares held for less than six months.
The fee is payable to the fund and is intended to benefit the remaining
shareholders by reducing the costs of short-term trading.

The hypothetical example below shows what you would pay if you invested $10,000
over the various time periods indicated in each fund. The example assumes that
you reinvested all dividends and that the average annual return was 5%. The
example for the John Hancock Fund assumes the expense limitation is in effect
for two years. The expense limitation may be in place for up to five years if
the Sub-Investment Management Contract remains in effect during that period,
but, in any case, will be in effect for at least two years. The examples are for
comparison purposes only and are not a representation of either fund's actual
expenses or returns, either past or future.

- --------------------------------------------------------------------------------
Example U.S. Global John Hancock
Leaders Fund
Growth Fund Class A
- --------------------------------------------------------------------------------
Year 1 $140
- --------------------------------------------------------------------------------
Year 3 $437
- --------------------------------------------------------------------------------
Year 5 $755
- --------------------------------------------------------------------------------
Year 10 $1,657
- --------------------------------------------------------------------------------

PROPOSAL TO APPROVE AGREEMENT AND PLAN OF REORGANIZATION

The Reorganization

o The reorganization is scheduled to occur as of 5:00 p.m., Eastern time, on
May 17, 2002, but may occur on any later date before July 31, 2002. Your
fund will transfer all of its assets to the John Hancock Fund. The John
Hancock Fund will assume your fund's liabilities that are included in the
calculation of your fund's net assets at the closing and liabilities with
respect to your fund's investment operations that are not required by
generally accepted accounting principles to be included in the calculation
of net asset value. The net asset value of both funds will be computed as
of 4:00 p.m., Eastern time, on the reorganization date.

o After the distribution of shares, your fund will be liquidated and
terminated as a series of Professionally Managed Portfolios.

Agreement and Plan of Reorganization

The shareholders of your fund are being asked to approve an Agreement and Plan
of Reorganization, a copy of which is attached as Exhibit A. The description of
the Agreement and Plan of Reorganization contained herein is qualified in its
entirety by the attached copy.

Reasons for the Proposed Reorganization

The trustees of your fund believe that the proposed reorganization will be
advantageous to the shareholders of your fund for several reasons. The trustees
considered the following matters, among others, in approving the proposal.

First, shareholders of your fund would enjoy continuity of portfolio management.
Because JHA will retain YWM to act as subadviser to the John Hancock Fund, the
portfolio management team of your fund will be the same portfolio management
team for the John Hancock Fund. JHA will oversee YWM as subadviser to the John
Hancock Fund in accordance with the terms of their Sub-Investment Management
Contract.

Second, while YWM will manage the assets of John Hancock US Global Leaders Fund
as its subadviser, JHA will be responsible for the overall management of John
Hancock US Global Leaders Fund's operations, including supervision of compliance
with the investment guidelines and regulatory restrictions. Your fund will
benefit from JHA's experience and resources in managing investment companies. At
December 31, 2001, JHA managed 67 investment companies with approximately $20
billion in assets. JHA also has significant experience in overseeing funds
managed by sub-advisers. At December 31, 2001, JHA employed 5 subadvisers, which
acted as sub-adviser for 11 of JHA's mutual funds.

Third, JHA and its affiliates have greater potential for increasing the size of
the fund due to JHA's experience in distribution of mutual funds through a
broader range of distribution channels than currently available to your fund.
Over the long-term, if this potential for a larger asset base is realized, it
will reduce the fund's per share operating expenses and increase the portfolio
management options available to the fund.

Fourth, For at least the next two years the John Hancock Fund's total expenses
will not be higher than, and may be less than, your fund's historical operating
expenses. JHA has agreed to limit the expenses of Class A shares of the John
Hancock Fund to 1.37% of average daily net assets until at least the second
anniversary of the closing of the reorganization. Currently, JHA anticipates
maintaining such expense limitation until at least the fifth anniversary if the
Sub-Investment Management Contract remains in effect. Moreover, there is
potential that the John Hancock Fund's expenses over time will be the same or
lower than your fund's expenses, even after the termination of the expense
limitation. The John Hancock Fund's management fee and Rule 12b-1 fee in the
aggregate are equal to your fund's current management fee, and if due to asset
growth and resulting economies of scale or other efficiencies the John Hancock
Fund's other expenses were lower than your fund's other expenses, the overall
expenses of the John Hancock Fund would be lower than those of your fund. If,
however, the John Hancock Fund's other expenses are higher than your fund's
other expenses and the expense limitation is terminated, overall expenses will
be higher than those of your fund.

Fifth, the Class A shares of the John Hancock Fund received in the
reorganization will provide your fund's shareholders with substantially the same
investment advantages as they currently have, including the ability to purchase
future shares without paying a sales charge.

Sixth, the John Hancock Fund is part of a diverse family of mutual funds, with
over 50 funds that will be available to your fund's shareholders through
exchanges. Currently, you fund is not entitled to any exchange privileges.

The board of trustees of the John Hancock Fund considered that the
reorganization presents an excellent opportunity for the John Hancock Fund to
acquire substantial investment assets without the obligation to pay commissions
or other transaction costs that a fund normally incurs when purchasing
securities. This opportunity provides an economic benefit to the John Hancock
Fund and its shareholders.

The boards of trustees of both funds also considered that each fund's investment
adviser, as well as the John Hancock Fund's principal distributor, will benefit
from the reorganization. Because the John Hancock Fund will be the accounting
successor to your fund and will assume your fund's performance record, JHA
expects to be able to increase the John Hancock Fund's assets at

a faster rate than would otherwise be possible if it began offering a fund with
similar objectives and no historical performance record. Such an increase in
size benefits JHA by increasing its management fees and accelerating the point
at which management of the fund is profitable to JHA. As subadviser to the John
Hancock Fund, YWM would similarly benefit from increased assets. Moreover, as
discussed below under "Certain Agreements between JHA and YWM", YWM will receive
other economic benefits if the reorganization is completed, including receipt of
a fee from JHA described uner "Certain Agreements between JHA and YWM". In
addition, the principal distributor of shares of the John Hancock Fund, John
Hancock Funds, LLC (the "Distributor"), will benefit through the adoption of the
Class A Rule 12b-1 plan.

Comparative Fees and Expense Ratios. As discussed above, the management fee
rates paid by your fund are higher than the rates paid by the John Hancock Fund.
The John Hancock Fund's management fee rate of 0.75% of average daily net assets
is lower than your fund's management fee rate of 1.00% of average daily net
assets. However, the John Hancock Fund's combined management fee and Class A
Rule 12b-1 fee are equal to your fund's management fee of 1.00% of average daily
net assets. Your fund does not have a Rule 12b-1 Fee. JHA projects that the John
Hancock Fund's other expenses during the current fiscal year will be ____% of
average daily net assets, which is [higher] than your fund's other expenses of
0.38% of average daily net assets. Nevertheless, as described above, JHA has
agreed until at least the second anniversary of the closing of the
reorganization (and until at least the fifth anniversary if the Sub-Investment
Management Contract with YWM continues in effect until that date) to limit the
John Hancock Fund's Class A ordinary operating expenses to 1.37% of average
daily net assets, which is slightly lower than your fund's annual total expense
ratio of 1.38% of average daily net assets for the fiscal year ended June 30,
2001.

Certain Agreements between JHA and YWM

In connection with the reorganization, JHA and YWM have entered into an
agreement that provides, among other things, for the following:

o JHA will pay YWM a fee upon the closing of the reorganization
pursuant to an agreement between JHA, YWM and George M. Yeager, dated
as of February 25, 2002 (the "Master Agreement"), in consideration of
(i) YWM entering into and performing its obligations under a
subadvisory agreement with JHA (the "Sub-Investment Management
Contract") to serve as subadviser to the John Hancock U.S. Global
Leaders Fund, and (ii) the performance by YWM of certain other
obligations under the Master Agreement.

o JHA has agreed to retain YWM as subadviser of John Hancock U.S. Global
Leaders Fund. The terms of the Sub-Investment Management Contract with YWM
are discussed under "Material Provisions of the Management Contracts and
the Sub-Investment Management Contract - Sub-Investment Management
Contract."

Tax Status of the Reorganization

The reorganization is not intended to result in income, gain or loss for United
States federal income tax purposes and will not take place unless both funds
receive a satisfactory opinion from Hale and Dorr LLP, counsel to the John
Hancock Fund, substantially to the effect that the reorganization described
above will be a "reorganization" within the meaning of Section 368(a) of the
Code.

As a result, for federal income tax purposes:

o No gain or loss will be recognized by your fund upon (1) the transfer of
all of its assets to the John Hancock Fund as described above or (2) the
distribution by your fund of the John Hancock Fund shares to your fund's
shareholders;

o No gain or loss will be recognized by the John Hancock Fund upon the
receipt of your fund's assets solely in exchange for the issuance of the
John Hancock Fund shares to your fund and the assumption of your fund's
liabilities by the John Hancock Fund;

o The basis of the assets of your fund acquired by the John Hancock Fund
will be the same as the basis of those assets in the hands of your fund
immediately before the transfer;

o The tax holding period of the assets of your fund in the hands of the John
Hancock Fund will include your fund's tax holding period for those assets;

o You will not recognize gain or loss upon the exchange of your shares of
your fund solely for the John Hancock Fund shares as part of the
reorganization;

o The basis of the John Hancock Fund shares received by you in the
reorganization will be the same as the basis of your shares of your fund
surrendered in exchange; and

o The tax holding period of the John Hancock Fund shares you receive will
include the tax holding period of the shares of your fund surrendered in
the exchange, provided that the shares of your fund were held as capital
assets on the date of the exchange.

In rendering such opinions, counsel shall rely upon, among other things,
reasonable assumptions as well as representations of your fund and the John
Hancock Fund.

No tax ruling has been or will be received from the Internal Revenue Service
("IRS") in connection with the reorganization. An opinion of counsel is not
binding on the IRS or a court, and no assurance can be given that the IRS would
not assert, or a court would not sustain, a contrary position.

You should consult your tax adviser for the particular tax consequences to you
of the transaction, including the applicability of any state, local or foreign
tax laws.

Additional Terms of Agreement and Plan of Reorganization

Surrender of Share Certificates. If your shares are represented by one or more
share certificates before the reorganization date, you must either surrender the
certificates to your fund or deliver to your fund a lost certificate affidavit,
in the form and accompanied by the surety bonds that your fund may require
(collectively, an "Affidavit"). On the reorganization date, all certificates
that have not been surrendered will be canceled, will no longer evidence
ownership of your fund's shares and will evidence ownership of the John Hancock
Fund's shares. Shareholders may not redeem or transfer John Hancock Fund shares
received in the reorganization until they have surrendered their fund share
certificates or delivered an Affidavit. The John Hancock Fund will not issue
share certificates in the reorganization.

Conditions to Closing the Reorganization. The obligation of your fund to
consummate the reorganization is subject to the satisfaction of certain
conditions, including the performance by the John Hancock Fund of all its
obligations under the Agreement and the receipt of all consents, orders and
permits necessary to consummate the reorganization (see Sections 6 and 8 of the
Agreement, attached as Exhibit A).

The obligation of the John Hancock Fund to consummate the reorganization is
subject to the satisfaction of certain conditions, including your fund's
performance of all of its obligations under the Agreement, the receipt of
certain documents and financial statements from your fund and the receipt of all
consents, orders and permits necessary to consummate the reorganization (see
Sections 7 and 8 of the Agreement, attached as Exhibit A).

The obligations of both funds are subject to the approval of the Agreement by
the necessary vote of the outstanding shares of your fund, in accordance with
the provisions of your fund's declaration of trust and by-laws. The funds'
obligations are also subject to the receipt of a favorable opinion of Hale and
Dorr LLP as to the federal income tax consequences of the reorganization. (see
Section 8 of the Agreement, attached as Exhibit A).

Termination of Agreement. The board of either your fund or the John Hancock Fund
may terminate the Agreement (even if the shareholders of your fund have already
approved it) at any time before the reorganization date, if that board believes
that proceeding with the reorganization would no longer be advisable.

Expenses of the Reorganization. JHA will pay all expenses incurred in connection
with the reorganization (including, but not limited to, the preparation of your
fund's proxy statement and solicitation).

CAPITALIZATION

The following table sets forth the capitalization of each fund as of December
31, 2001, and the pro forma combined capitalization of both funds as if the
reorganization had occurred on that date. This table reflects the pro forma
ratios of one Class A share of the John Hancock Fund being issued for each share
of your fund. The exchange ratio will remain 1:1 on the closing date of the
reorganization.

- ---------------------------------------------------------------------------------------------
December 31, 2001
- ---------------------------------------------------------------------------------------------
John Hancock
John Hancock Global Leaders Fund
U.S. Global Leaders Global Leaders Fund Class A shares
Growth Fund Class A shares Pro Forma
- ---------------------------------------------------------------------------------------------

Net Assets $84 million N/A $84 million
- ---------------------------------------------------------------------------------------------
Net Asset Value Per Share N/A
- ---------------------------------------------------------------------------------------------
Shares Outstanding N/A
- ---------------------------------------------------------------------------------------------

It is impossible to predict how many shares of the John Hancock Fund will
actually be received and distributed by your fund on the reorganization date.
The table should not be relied upon to determine the amount of the John Hancock
Fund's shares that will actually be received and distributed.

BOARDS' EVALUATION AND RECOMMENDATION

For the reasons described above, the board of trustees of your fund, including
the trustees who are not "interested persons" of your fund or YWM ("independent
trustees"), approved the reorganization. In particular, the trustees determined
that the reorganization is in the best interests of your fund. Similarly, the
board of trustees of the John Hancock Fund, including its independent trustees,
approved the reorganization. They also determined that the reorganization is in
the best interests of the John Hancock Fund.

The trustees of your fund recommend that the shareholders of your fund vote FOR
the proposal to approve the Agreement and Plan of Reorganization.

VOTING RIGHTS AND REQUIRED VOTE

Each share of your fund is entitled to one vote and each fractional share shall
be entitled to a proportionate fractional vote. A quorum is required to conduct
business at the Meeting. The presence in person or by proxy of shareholders
entitled to cast 40% of the votes entitled to be cast at the Meeting will
constitute a quorum. The favorable vote of a majority of the outstanding shares
of your fund is required for approval of the proposal.

- -----------------------------------------------------------------------------------------------------------------------------------
Shares Quorum Voting
- -----------------------------------------------------------------------------------------------------------------------------------

In General All shares "present" in Shares "present" in person will be voted in person at the meeting.
person or by proxy are Shares present by proxy will be voted in accordance with
counted towards a quorum. instructions.
- -----------------------------------------------------------------------------------------------------------------------------------
Broker Non-Vote (where the Considered "present" at Broker non-votes do not count as a vote "for" and effectively result
underlying holder has not meeting for purposes of in a vote "against."
voted and the broker does quorum
not have discretionary
authority to vote the
shares)
- -----------------------------------------------------------------------------------------------------------------------------------
Proxy with No Voting Considered "present" at Voted "for" the proposal.
Instruction (other than meeting for purposes of
Broker Non-Vote) quorum
- -----------------------------------------------------------------------------------------------------------------------------------
Vote to Abstain Considered "present" at Abstentions do not constitute a vote "for" and effectively result in
meeting for purposes of a vote "against."
quorum
- -----------------------------------------------------------------------------------------------------------------------------------

If the required approval of shareholders is not obtained, the meeting may be
adjourned as more fully described in this proxy statement and prospectus. Your
fund will continue to engage in business as a separate mutual fund and the board
of trustees will consider what further action may be appropriate.

ADDITIONAL INFORMATION ABOUT JOHN HANCOCK U.S. GLOBAL LEADERS GROWTH FUND

Investment Adviser

JHA is the investment adviser to the John Hancock Fund. JHA, located at 101
Huntington Avenue, Boston, Massachusetts 02199-7603, was organized in 1968 and
has approximately $30 billion in assets under management in its capacity as
investment adviser to the funds in the John Hancock group of funds, as well as
retail and institutional privately managed accounts.

JHA is an indirect, wholly-owned subsidiary of John Hancock Life Insurance
Company (formerly John Hancock Mutual Life Insurance Company)(the "Life
Company"), a Massachusetts life insurance company chartered in 1862, with
national headquarters at John Hancock Place, Boston, Massachusetts. The Life
Company is wholly owned by John Hancock Financial Services, Inc., a Delaware
corporation organized in 2000. The Life Company is one of the most recognized
and respected financial institutions in the nation. With total assets under
management of approximately $100 billion, the Life Company is one of the ten
largest life insurance companies in the United States, and carries a high rating
from Standard & Poor's and A.M. Best. Founded in 1862, the Life Company has been
serving clients for over 130 years.

The board of trustees of the John Hancock Fund is responsible for overseeing the
performance of the fund's investment adviser and subadviser and determining
whether to approve and renew the fund's investment management contract and the
sub-investment management contract. For a discussion of these contracts, see
"Material Provisions of the Management Contracts and the Sub-Investment
Management Contract" below.

Investment Subadviser

YWM will serve as the John Hancock Fund's investment subadviser and is located
at 630 Fifth Avenue, New York, New York 10111. YWM has been providing investment
advisory services since 1968 and is controlled by Mr. George M. Yeager,
President. YWM provides investment advisory services to individual and
institutional investors with assets under management of $345 million as of
December 31, 2001. YWM has been the investment adviser to your fund since it
commenced operations.

Portfolio Managers

Mr. George M. Yeager, President of YWM, and Mr. George P. Fraise, Executive Vice
President of YWM, are responsible for the day-to-day management of the John
Hancock Fund's portfolio. Mr. Yeager has been with YWM since 1968. Mr. Fraise
joined YWM in early 2000 and is a member of its Investment Policy Committee.
Messrs. Yeager and Fraise are portfolio managers of your fund. Mr. Yeager has
been responsible for portfolio management of your fund since it commenced
operations. Prior to joining YWM, Mr. Fraise was associated with Scudder Kemper
Investments where he was a co-manager for the Scudder Large Company Growth Fund
and a co-lead manager for the Kemper Growth Fund.

MATERIAL PROVISIONS OF THE MANAGEMENT CONTRACT AND THE SUB-INVESTMENT MANAGEMENT
CONTRACT

Management Contract - U.S. Global Leaders Growth Fund

The following is a summary of the material terms of the your fund's existing
investment advisory agreement with YWM (the "YWM Management Contract").

Services. Under the YWM Management Contract, YWM provides your fund with advice
on buying and selling securities, broker-dealer selection, and negotiation of
brokerage commission rates. In addition to managing the investments of the fund,
YWM furnishes office space and facilities, equipment and clerical personnel
necessary for carrying out its duties under the YWM Management Contract and pays
all compensation of any trustees, officers and employees of the fund who are
affiliated persons of YWM. All operating costs and expenses relating to the fund
not expressly assumed by YWM under the YWM Management Contract are paid by the
fund.

Compensation. As compensation under the YWM Management Contract, the fund pays
YWM a monthly investment advisory fee (accrued daily) based upon the average
daily net assets of the fund at the rate of 1.00% annually. For the fiscal year
ended June 30, 2001, your fund paid management fees to YWM equal to $845,254.

YWM has voluntarily agreed to reduce its fees and/or pay expenses of your fund
to ensure that your fund's aggregate annual operating expenses (excluding
interest and tax expenses) will not exceed 1.39% of the fund's average daily net
assets. YWM may

modify or eliminate this waiver at any time. YWM is permitted to be reimbursed
for fee reductions and/or expense payments made in the prior three fiscal years,
subject to review by the trustees. Your fund must pay its current ordinary
operating expenses before YWM is entitled to any reimbursement of fees and/or
expenses. There have been no such reimbursements to date and none are expected
to be made prior to the proposed closing date.

Limitation of Liability. YWM shall not be liable for any loss sustained by
reason of the purchase sale or retention of any security, provided that YWM
shall not by reason of willful misfeasance, bad faith, or gross negligence in
the performance of its duties, or by reason of its reckless disregard of
obligations and duties under the agreement be protected against any liability.

Term. The YWM Management Contract continues in effect for successive annual
periods, subject to the annual approval of its continuance as described below
under "Termination, Continuance and Amendment."

Termination, Continuance and Amendment. The YWM Management Contract continues
from year to year subject to approval of its continuance at least annually by
the vote of (1) the board of trustees (or a majority of the outstanding shares
of your fund), and (2) a majority of your fund's independent trustees, in each
case cast in person at a meeting called for the purpose of voting on such
approval. The agreement may be terminated at any time, without penalty, by
either party to the agreement upon 60 days' written notice and is automatically
terminated in the event of its "assignment," as defined in the Investment
Company Act. The YWM Management Contract was last approved by the board of
trustees at a meeting called for that purpose on June 20, 2001.

Management Contract - the John Hancock Fund

The following is a summary of the material terms of the John Hancock Fund's
investment management contract with JHA (the "JHA Management Contract").

Services. Under the JHA Management Contract, JHA, subject to the direction of
the trustees, provides the fund with a continuous investment program for the
management of its assets, consistent with the fund's investment objective and
policies. JHA provides for such investment program through the retention of YWM
as subadviser. In addition, JHA:

o pays the fee of YWM as subadviser and supervises YWM's activities as
subadviser;

o advises the fund in connection with policy decisions to be made by the
trustees;

o provides day-to-day administration; and

o provides required reports and recommendations to the trustees and
maintains the records of the fund.

JHA provides the fund with office space, supplies and other facilities required
for the business of the fund. JHA pays the compensation of all officers and
employees of the fund and pays the expenses of clerical services related to the
administration of the fund. Other than expenses specifically assumed by JHA, all
expenses incurred in the continuing operation of the fund are borne by the fund,
including fees of the independent trustees and all fees of lawyers and
accountants.

Compensation. The John Hancock Fund pays an investment management fee to JHA
equal on an annual basis to 0.75% of the average daily net assets of the fund.
Because the fund is not yet operational and does not expect to be operational
until the consummation of the reorganization, the fund has not paid management
fees in the past.

As described above, JHA has agreed until at least the second anniversary (and
until at least the fifth anniversary as long as the Sub-Investment Management
Contract with YWM remains in effect) of the closing of the reorganization to
reduce its fees and/or pay expenses of the John Hancock Fund to ensure that the
fund's aggregate annual ordinary operating expenses (excluding interest, tax
expenses and other extraordinary items) will not exceed 1.37% of the fund's
average daily net assets.

Term. The proposed contract will take effect on the closing date of the
reorganization and will remain in effect for two years. Thereafter, the proposed
contract will continue in effect from year to year subject to the annual
approval of its continuance as described below under "Termination, Continuance
and Amendment."

Limitation of Liability. The JHA Management Contract provides that JHA is not
liable for any error of judgment or mistake of law or for any loss suffered by
the fund in connection with the matters to which the respective contract
relates, except a loss resulting from willful misfeasance, bad faith or gross
negligence on the part of the JHA in the performance of its duties or from the
reckless disregard of its obligations and duties under the contract.

Termination, Continuance and Amendment. Except as described above the JHA
Management Contract continues from year to year subject to annual approval of
its continuance by a majority of the independent trustees, cast in person at a
meeting called for

the purpose of voting on such approval, and annual approval by either (a) the
fund's trustees, or (b) a majority of the fund's outstanding voting securities,
as defined in the Investment Company Act. The contract may be terminated at any
time without penalty on 60 days' written notice by the trustees, by a vote of a
majority of the fund's outstanding voting securities, or by JHA. The contract
terminates automatically in the event of its assignment or in the event that JHA
ceases to act as the fund's investment adviser.

Use of Name "John Hancock." Under the JHA Management Contract, if JHA ceases to
act as the fund's investments adviser, the fund (to the extent that it lawfully
can) must cease to use the name " John Hancock U.S. Global Leaders Growth Fund"
or any name derived from the name "John Hancock" or any other name indicating
that the fund is advised by or otherwise associated with JHA.

Sub-Investment Management Contract - the John Hancock Fund

YWM will serve as subadviser to the John Hancock Fund pursuant to a
sub-investment management contract among the fund, JHA and YWM (the
"Sub-Investment Management Contract"). The following is a summary of certain of
the material terms of the Sub-Investment Management Contract.

Services. Under the Sub-Investment Management Contract YWM will, at its own
expense:

o furnish JHA and the fund with advice and recommendations with respect to
the purchase, holding and disposition of portfolio securities;

o furnish JHA and the fund with advice as to exercise of voting rights,
subscription rights, rights to consent to corporate action and any other
rights pertaining to the fund's assets;

o furnish JHA and the fund with research, economic and statistical data in
connection with the fund's investments and investment policies;

o submit reports relating to the valuation of the fund's securities and
monitor valuations in accordance with the fund's valuation procedures;

o make reports of YWM's performance of its services and compliance with
applicable statutory and regulatory requirements;

o maintain certain books and records with respect to the fund's securities
transactions; and

o cooperate with and provide reasonable assistance to JHA, the fund, and the
fund's other agents and representatives with respect to requests for
information and preparation of regulatory filings and reports.

YWM is required to place all trades for the John Hancock Fund through JHA's
trading desk. JHA shall have complete authority to determine the brokers or
dealers through which any trade by the fund is placed and as to the timing and
manner of the execution of any such trade.

Compensation. JHA will pay YWM a quarterly fee equal on an annual basis to the
following percentages of the fund's average daily net assets:

o 0.3375% with respect to the first $500,000,000 of the average daily net
asset value of the fund;

o 0.300% with respect to the average daily net asset value of the fund in
excess of $500,000,000 up to $1,000,000,000;

o 0.2625% with respect to the average daily net asset value of the fund in
excess of $1,000,000,000 up to $1,500,000,000;

o 0.225% of the average daily net asset value of the fund in excess of
$1,500,000,000 up to $2,000,000,000; and

o 0.1875% of the average daily net asset value of the fund in excess of
$2,000,000,000.

During the first year of the agreement, JHA has agreed to pay YWM a minimum fee
under the Sub-Investment Management Contract of $750,000. The sub-advisory fee
is subject to reduction if George M. Yeager, George P. Fraise or any other
person designated as a co-portfolio manager of the John Hancock Fund ceases
employment with YWM and is not replaced with a new co-portfolio manager
acceptable to JHA. Moreover, during the initial three year term of the
Sub-Investment Management Contract, if the sub-advisory fee exceeds certain
annual targets, payment of any additional subadvisory fee for such year is
deferred until the Sub-Investment Management Contract has been in place for
three years, at which time the deferred amounts will be payable to YWM;
provided, however, if at any time prior to such third year anniversary if George
Yeager ceases to be employed by YWM or is not an active member of the fund's
portfolio management team, other than due to termination of the Sub-Investment
Management Contract by JHA or the John Hancock Fund without Cause (as defined in
the Master Agreement), the amounts deferred shall no longer be payable to YWM.
The amount of the deferred fee over the three year period may not exceed $3.25
million.

Limitation of Liability. The Sub-Investment Management Contract provides that
YWM shall not be liable for any losses, claims, damages, liabilities or
litigation (including legal and other expenses) incurred or suffered by JHA, the
fund or any of their affiliates as a result of any error of judgment or mistake
of law by YWM with respect to the fund, except that YWM shall be

liable for and shall indemnify JHA and the fund from any loss arising out of or
based on (i) YWM's causing the fund to be in violation of any applicable federal
or state law, rule or regulation or any investment policy or restriction set
forth in the fund's prospectus or statement of additional information or any
written policies, procedures, guidelines or instructions provided in writing to
YWM by the trustees of the fund or JHA, (ii) YWM's causing the fund to fail to
satisfy the requirements for qualification as a regulated investment company
under the Code, or (iii) YWM's willful misfeasance, bad faith or gross
negligence generally in the performance of its duties hereunder or its reckless
disregard of its obligations and duties under the Sub-Investment Management
Contract.

Term, Termination. The Sub-Investment Management Contract shall remain in force
until June 30, 2007, provided its continuance is approved prior to June 30, 2003
and annually thereafter as required by the Investment Company Act. The
Sub-Investment Management Contract may be terminated at any time on 10 days'
written notice without penalty by either (a) the fund's trustees, or (b) a
majority of the fund's outstanding voting securities, as defined in the
Investment Company Act, and may be terminated upon 30 days written notice by
YWM. Termination of the agreement with respect to the Fund shall not be deemed
to terminate or otherwise invalidate any provisions of any contract between YWM
and any other series of the Trust. The agreement shall automatically terminate
in the event of its assignment or upon termination of the JHA Management
Contract.

JOHN HANCOCK U.S. GLOBAL LEADERS FUND CLASS A RULE 12b-1 PLAN

As described above, the John Hancock Fund has adopted a Rule 12b-1 plan for its
Class A shares (the "Plan"). Because the 12b-1 fees payable under the Plan are
an ongoing expense, over time they may increase the cost of your investment and
your shares may cost more than shares that are not subject to a distribution or
service fee or sales charge.

Compensation and Services. Under the Plan, the fund will pay distribution and
service fees at an aggregate annual rate of up to 0.25% of the fund's average
daily net assets attributable to Class A shares. The distribution fee will be
used to reimburse the John Hancock Funds, LLC for its distribution expenses,
including but not limited to: (i) initial and ongoing sales compensation to
selling brokers and others (including affiliates of the John Hancock Funds, LLC)
engaged in the sale of fund shares; and (ii) marketing, promotional and overhead
expenses incurred in connection with the distribution of fund shares. The
service fees will be used to compensate selling brokers and others for providing
personal and account maintenance services to shareholders. In the event that the
Distributor is not fully reimbursed for payments or expenses incurred under the
Plan, these expenses will not be carried beyond twelve months from the date they
were incurred. Because the John Hancock Fund is not yet operational and does not
expect to be operational until the consummation of the reorganization, the fund
has not paid Rule 12b-1fees in the past.

Trustee Approval and Oversight. The Plan was approved by the trustees of the
John Hancock Fund, including a majority of the fund's independent trustees, by
votes cast in person at meetings called for the purpose of voting on the Plan on
February 26, 2002. Pursuant to the Plan, at least quarterly, the Distributor
will provide the fund with a written report of the amounts expended under the
Plan and the purpose for which these expenditures were made. The trustees review
these reports on a quarterly basis to determine their continued appropriateness.

Term and Termination. The Plan provides that it will continue in effect only so
long as its continuance is approved at least annually by a majority of both the
fund's trustees and the independent trustees. The Plan provides that it may be
terminated without penalty, (a) by the vote of a majority of the fund's
trustees, independent trustees, or by a vote of a majority of the fund's
outstanding Class A shares or (b) by the Distributor upon 60 days' written
notice to the fund. The Plan further provides that it may not be amended to
increase the maximum amount of the fees for the services described therein
without the approval of a majority of the outstanding Class A shares of the
fund. The Plan provides, that no material amendment to the Plan will be
effective unless it is approved by a majority vote of the trustees and the
independent trustees. The holders of Class A shares have exclusive voting rights
with respect to the Plan. In adopting the Plan, the trustees concluded that, in
their judgment, there is a reasonable likelihood that the Plan will benefit the
holders of the applicable class of shares of the fund.

Joint Expenditures. Amounts paid to the Distributor under the Plan will not be
used to pay the expenses incurred with respect to any other class of shares;
provided, however, that expenses attributable to the fund as a whole will be
allocated, to the extent permitted by law, according to a formula based upon
gross sales dollars and/or average daily net assets of each such class, as may
be approved from time to time by vote of a majority of trustees. From time to
time, the fund may participate in joint distribution activities with other funds
and the costs of those activities will be borne by each fund in proportion to
the relative net asset value of the participating fund.

FINANCIAL HIGHLIGHTS

This table shows U.S. Global Leaders Growth Fund's financial performance for the
past five fiscal years and the six month period ended December 31, 2001. Certain
information reflects financial results for a single fund share. "Total return"
shows how much your investment in the U.S. Global Leaders Growth Fund would have
increased or decreased during each period, assuming you had reinvested all
dividends and distributions. This information (other than with respect to the
six month period ended December 31, 2001) has been audited by Ernst & Young LLP,
Independent Auditors. Their report and U.S. Global Leaders Growth Fund's
financial statements are included in its Annual Report, which is available upon
request.

Six Month Year Ended June 30,
Period Ended -------------------------------------------------------------
December 31,
2001 2001 2000 1999 1998 1997
---- ---- ---- ---- ---- ----

Net asset value, beginning of period $26.37 $25.65 $22.35 $16.29 $12.08
------ ------ ------ ------ ------
Income from investment operations:
Net investment loss (0.14) (0.07) (0.13) (0.07) (0.04)
Net realized and unrealized gain (loss)
on investments (1.25) 0.79 3.43 6.13 4.39
------ ------ ------ ------ ------
Total from investment operations (1.39) 0.72 3.30 6.06 4.35
------ ------ ------ ------ ------
Less distributions:
From net realized gain -- -- -- -- (0.14)
------ ------ ------ ------ ------
Net asset value, end of year $24.98 $26.37 $25.65 $22.35 $16.29
====== ====== ====== ====== ======
Total return (5.27%) 2.81% 14.77% 37.20% 36.29%
Ratios/supplemental data:
Net assets, end of year (millions) $81.2 $86.9 $129.0 $89.4 $26.9
Ratio of expenses to average net assets:
Before fees waived and expenses
absorbed 1.38% 1.31% 1.31% 1.43% 1.87%
After fees waived and expenses
absorbed 1.38% 1.31% 1.31% 1.42% 1.48%
Ratio of net investment loss to average
net assets:
Before fees waived and expenses
absorbed (0.54)% (0.23)% (0.66)% (0.67)% (0.79)%
After fees waived and expenses
absorbed (0.54)% (0.23)% (0.66)% (0.66)% (0.39)%
Portfolio turnover rate 3.12% 24.91% 14.27% 4.02% 21.49%

INFORMATION CONCERNING THE MEETING

Solicitation of Proxies

In addition to the mailing of these proxy materials, proxies may be solicited by
telephone, by fax or in person by the trustees, officers and employees of your
fund; by personnel of your fund's investment adviser, YWM and your fund's
transfer agent, Orbitex Data Services, Inc.; or by broker-dealer firms. Orbitex
Data Services, Inc., together with a third party solicitation firm, has agreed
to provide proxy solicitation services to your fund at a cost of approximately
$___, to be paid by JHA.

Revoking Proxies

A U.S. Global Leaders Growth Fund shareholder signing and returning a proxy has
the power to revoke it at any time before it is exercised:

o By filing a written notice of revocation with your fund's transfer agent,
Orbitex Data Services, Inc., P.O. Box 542007, Omaha, NE 68154-1952, or

o By returning a duly executed proxy with a later date before the time of
the meeting, or

o If a shareholder has executed a proxy but is present at the meeting and
wishes to vote in person, by notifying the secretary of your fund (without
complying with any formalities) at any time before it is voted.

Being present at the meeting alone does not revoke a previously executed and
returned proxy.

Outstanding Shares and Quorum

As of March 20, 2002, [ ] shares of beneficial interest of your fund were
outstanding. Only shareholders of record on [March 20, 2002] (the "record date")
are entitled to notice of and to vote at the meeting. The presence in person or
by proxy of shareholders of your fund entitled to cost 40% of the votes entitled
to be cast at the Meeting will constitute a quorum.

Other Business

Your fund's board of trustees knows of no business to be presented for
consideration at the meeting other than the proposal. If other business is
properly brought before the meeting, proxies will be voted according to the best
judgment of the persons named as proxies.

Adjournments

If, by the time scheduled for the Meeting, a quorum of shareholders is not
present or if a quorum is present but sufficient votes "for" the proposal have
not been received, the persons named as proxies may propose one or more
adjournments of the Meeting to another date and time, and the Meeting may be
held as adjourned within a reasonable time after the date set for the original
Meeting without further notice. Any such adjournment will require the
affirmative vote of a majority of the votes cast on the question in person or by
proxy at the session of the Meeting to be adjourned. The persons named as
proxies will vote all proxies in favor of the adjournment that voted in favor of
the proposal or that abstained. They will vote against such adjournment those
proxies required to be voted against the proposal. Broker non-votes will be
disregarded in the vote for adjournment. If the adjournment requires setting a
new record date or the adjournment is for more than 60 days from the date set
forth the original meeting (in which case the Board of Trustees of your fund
will set a new record date), your fund will give notice of the adjourned meeting
to its shareholders.

Telephone Voting

In addition to soliciting proxies by mail, by fax or in person, your fund may
also arrange to have votes recorded by telephone by officers and employees of
your fund or by personnel of the adviser or transfer agent or a third party
solicitation firm. The telephone voting procedure is designed to verify a
shareholder's identity, to allow a shareholder to authorize the voting of shares
in accordance with the shareholder's instructions and to confirm that the voting
instructions have been properly recorded. If these procedures were subject to a
successful legal challenge, these telephone votes would not be counted at the
meeting. Your fund has not obtained an opinion of counsel about telephone
voting, but is currently not aware of any challenge.

o A shareholder will be called on a recorded line at the telephone number in
the fund's account records and will be asked to provide the shareholder's
social security number or other identifying information.

o The shareholder will then be given an opportunity to authorize proxies to
vote his or her shares at the meeting in accordance with the shareholder's
instructions.

o To ensure that the shareholder's instructions have been recorded
correctly, the shareholder will also receive a confirmation of the voting
instructions by mail.

o A toll-free number will be available in case the voting information
contained in the confirmation is incorrect.

o If the shareholder decides after voting by telephone to attend the
meeting, the shareholder can revoke the proxy at that time and vote the
shares at the meeting.

Internet Voting

[You will also have the opportunity to submit your voting instructions via the
internet by utilizing a program provided through a vendor. Voting via the
internet will not affect your right to vote in person if you decide to attend
the meting. Do not mail the proxy card if you are voting via the internet. To
vote via the internet , you will need the __ digit "control number" that appears
on your proxy card. These Internet voting procedures are designed to
authenticate shareholder identities, to allow shareholders give their voting
instructions, and to confirm that shareholders instructions have been recorded
properly. If you are voting via the internet you should understand that there
may be costs associated with electronic access, such as usage charges from
internet access providers and telephone companies, that must be borne to you.]

o Read the proxy statement and have your proxy card at hand.

[o Go to the Web site _________________. ]

[o Select the shareholder entryway. ]

[o Select the proxy-voting link for your Fund.]

[o Enter the __ digit "control number" found on your proxy card.]

[o Follow the instructions on the Web site. Please call us at 1-800-___-____
if you have any problems.]

[o To insure that your instructions have been recorded correctly, you will
receive a confirmation of your voting instructions immediately after your
submission and also by email if chosen. ]

Shareholders' Proposals

Your fund is not required, and does not intend, to hold meetings of shareholders
each year. Instead, meetings will be held only when and if required. Any
shareholders desiring to present a proposal for consideration at the next
meeting for shareholders must submit the proposal in writing, so that it is
received by the your fund at 630 Fifth Avenue, New York, New York 10111 within a
reasonable time before any meeting.

OWNERSHIP OF SHARES OF THE FUNDS

To the knowledge of your fund, as of March 20, 2002, the following persons
owned of record or beneficially 5% or more of the outstanding shares of U.S.
Global Leaders Growth Fund. No shares of the John Hancock Fund were outstanding
as of that date.

- ----------------------------------------------------------------------------------------------
Names and addresses of Shares of Pro Forma Ownership of
owners of more than 5% of shares U.S. Global Leaders Growth Fund John Hancock Fund
- ----------------------------------------------------------------------------------------------

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

[As of March 20, 2002, the trustees and officers of your fund and the trustees
and officers of the John Hancock Fund, each as a group, owned in the aggregate
less than 1% of the outstanding shares of their respective funds.]

EXPERTS

The financial statements and the financial highlights of U.S. Global Leaders
Growth Fund for the fiscal year ended June 30, 2001 and the six-month period
ended December 31, 2001 are incorporated by reference into this proxy statement
and prospectus. The financial statements and financial highlights (except for
the period ending December 31, 2001) for U.S. Global Leaders Growth Fund have
been independently audited by Ernst & Young as stated in their reports appearing
in the statement of additional information. These financial statements and
financial highlights have been included in reliance on their reports given on
their authority as experts in accounting and auditing.

AVAILABLE INFORMATION

U.S. Global Leaders Growth Fund is and the John Hancock Fund will be subject to
the informational requirements of the Securities Exchange Act of 1934 and the
Investment Company Act and file reports, proxy statements and other information
with the SEC. These reports, proxy statements and other information filed by the
funds can be inspected and copied (for a duplication fee) at the public
reference facilities of the SEC at 450 Fifth Street, N.W., Washington, D.C., and
at the Midwest Regional Office (500 West Madison Street, Suite 1400, Chicago,
Illinois). Copies of these materials can also be obtained by mail from the
Public Reference Section of the SEC at 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates. In addition, copies of these documents may be viewed
on-screen or downloaded from the SEC's Internet site at http://www.sec.gov.

Exhibit A

AGREEMENT AND PLAN OF REORGANIZATION

THIS AGREEMENT AND PLAN OF REORGANIZATION (the "Agreement") is made this 1st day
of March, 2002, by and between John Hancock U.S. Global Leaders Growth Fund
(the "Acquiring Fund"), a series of John Hancock Capital Series, a Massachusetts
business trust (the "Acquiring Trust") with its principal place of business at
101 Huntington Avenue, Boston, Massachusetts, and Professionally Managed
Portfolios (formerly Avondale Investment Trust), a Massachusetts business trust
(the "Trust"), on behalf of U.S. Global Leaders Growth Fund (the "Acquired
Fund"), a series of the Trust with its principal place of business at 630 Fifth
Avenue, New York, New York. The Acquiring Fund and the Acquired Fund are
sometimes referred to collectively herein as the "Funds" and individually as a
"Fund."

This Agreement is intended to be and is adopted as a plan of "reorganization" as
such term is used in Section 368(a) of the United States Internal Revenue Code
of 1986, as amended (the "Code"). The reorganization (the "Reorganization") will
consist of (1) the transfer of all of the assets of the Acquired Fund to the
Acquiring Fund in exchange solely for (A) the issuance of Class A shares of
beneficial interest of the Acquiring Fund (collectively, the "Acquiring Fund
Shares" and each, an "Acquiring Fund Share") to the Acquired Fund, and (B) the
assumption by the Acquiring Fund of (i) the liabilities of the Acquired Fund
that are included in the calculation of net asset value ("NAV") on the Closing
Date set forth below (the "Closing Date") and (ii) the liabilities of the
Acquired Fund on the Closing Date with respect to its investment operations that
are both (a) not required by generally accepted accounting principles ("GAAP")
to be included in the calculation of NAV and (b) are consistent with liabilities
incurred by registered management investment companies in the ordinary course of
their businesses (i.e., not including any extraordinary obligations, including,
but not limited to legal proceedings, shareholder claims and distribution
payments) (collectively, the "Assumed Liabilities"), and (2) the distribution by
the Acquired Fund, on or promptly after the Closing Date as provided herein, of
the Acquiring Fund Shares to the shareholders of the Acquired Fund in
liquidation and termination of the Acquired Fund, all upon the terms and
conditions hereinafter set forth in this Agreement.

WHEREAS, Acquiring Trust and the Trust are each registered investment companies
classified as management companies of the open-end type, and the Acquired Fund
owns securities that are assets of the character in which the Acquiring Fund is
permitted to invest.

WHEREAS, the Acquiring Fund is authorized to issue shares of beneficial
interest.

WHEREAS, the Board of Trustees of the Acquiring Trust has determined that the
exchange of all of the assets of the Acquired Fund for Acquiring Fund Shares,
and the assumption of the Assumed Liabilities of the Acquired Fund by the
Acquiring Fund are in the best interests of the Acquiring Fund shareholders.

WHEREAS, the Board of Trustees of the Trust has determined that the exchange of
all of the assets of the Acquired Fund for Acquiring Fund Shares, and the
assumption of the Assumed Liabilities of the Acquired Fund by the Acquiring Fund
are in the best interests of the Acquired Fund shareholders.

NOW, THEREFORE, in consideration of the premises of the covenants and agreements
hereinafter set forth, the parties hereto covenant and agree as follows:

1. TRANSFER OF ASSETS OF THE ACQUIRED FUND IN EXCHANGE FOR THE ACQUIRING FUND
SHARES AND ASSUMPTION OF THE ASSUMED LIABILITIES; LIQUIDATION AND TERMINATION OF
THE ACQUIRED FUND.

1.1 Subject to the terms and conditions herein set forth and on the basis of the
representations and warranties contained herein, the Acquired Fund will transfer
all of its assets as set forth in Paragraph 1.2 (the "Acquired Assets") to the
Acquiring Fund free and clear of all liens and encumbrances (other than those
arising under the Securities Act of 1933, as amended (the "Securities Act"),
liens for taxes not yet due and contractual restrictions on the transfer of the
Acquired Assets) and the Acquiring Fund agrees in exchange therefore: (i) to
issue to the Acquired Fund the number of Acquiring Fund Shares, including
fractional Acquiring Fund Shares, determined in the manner set forth in
Paragraph 2.2; and (ii) to assume the Assumed Liabilities, as set forth in
Paragraph 1.3. Such transactions shall take place at the Closing provided for in
Paragraph 3.1.

1.2 (a) The Acquired Assets shall consist of all of its property, including,
without limitation, all portfolio securities and instruments, dividends and
interest receivables, cash, goodwill, contractual rights of the Acquired Fund or
the Trust in respect of the Acquired Fund, all other intangible property owned
by the Acquired Fund, originals or copies of all books and records of the

Acquired Fund, and all other assets of the Acquired Fund on the Closing Date.
The Acquiring Fund shall also be entitled to receive (or to the extent agreed
upon between the Trust and the Acquiring Trust, be provided access to) copies of
all records that the Trust is required to maintain under the Investment Company
Act of 1940, as amended (the "Investment Company Act") and the rules of the
Securities and Exchange Commission (the "Commission") thereunder to the extent
such records pertain to the Acquired Fund.

(b) The Acquired Fund has provided the Acquiring Fund with a list of all of the
Acquired Fund's securities and other assets as of the date of execution of this
Agreement, and the Acquiring Fund has provided the Acquired Fund with a copy of
the current fundamental investment policies and restrictions and fair value
procedures applicable to the Acquiring Fund. The Acquired Fund reserves the
right to sell any of such securities or other assets before the Closing Date
(except to the extent sales may be limited by representations of the Acquired
Fund contained herein and made in connection with the issuance of the tax
opinion provided for in Paragraph 8.5 hereof), but will not, without the prior
approval of the Acquiring Fund, acquire any additional securities of the type in
which the Acquiring Fund is not permitted to invest in accordance with its
fundamental investment policies and restrictions or any securities that are
valued at "fair value" under the valuation procedures of either the Acquired
Fund or the Acquiring Fund.

1.3 The Acquired Fund will endeavor to discharge all the Acquired Fund's known
liabilities and obligations that are or will become due prior to the Closing.
The Acquiring Fund shall assume all of the Assumed Liabilities at Closing.

1.4 After the Acquiring Fund Shares have been issued to the Acquired Fund and
immediately prior to the distribution of such Acquiring Fund Shares to the
shareholders of the Acquired Fund (as provided in Section 1.6), the Acquired
Fund, as the initial shareholder of the Acquiring Fund, shall approve (i) the
Investment Management Contract between the Acquiring Fund and John Hancock
Advisers, LLC, (ii) the Sub-Investment Management Contract among the Acquiring
Fund, John Hancock Advisers, LLC and Yeager, Wood & Marshall, Incorporated,
(iii) the Acquiring Fund's Class A Plan of Distribution, (iv) the Acquiring
Fund's fundamental investment policies and restrictions, and (v) such other
matters as are appropriate for an initial shareholder of an investment company
to approve.

1.5 On or as soon after the Closing Date as is conveniently practicable (the
"Liquidation Date"), the Trust shall liquidate the Acquired Fund and distribute
pro rata to its shareholders of record (the "Acquired Fund Shareholders"),
determined as of the close of regular trading on the New York Stock Exchange on
the Closing Date, the Acquiring Fund Shares received by the Acquired Fund
pursuant to Paragraph 1.1 hereof. Such liquidation and distribution will be
accomplished by the Trust instructing the Acquiring Fund to transfer the
Acquiring Fund Shares then credited to the account of the Acquired Fund on the
books of the Acquiring Fund to open accounts on the share records of the
Acquiring Fund established and maintained by the Acquiring Fund's transfer agent
in the names of the Acquired Fund Shareholders and representing the respective
pro rata number of the Acquiring Fund Shares due such Acquired Fund
Shareholders. The Trust shall promptly provide the Acquiring Fund with evidence
of such liquidation and distribution. All issued and outstanding shares of the
Acquired Fund will simultaneously be cancelled on the books of the Acquired
Fund. The Acquiring Fund shall not issue certificates representing the Acquiring
Fund Shares in connection with such exchange.

1.6 Ownership of Acquiring Fund Shares will be shown on the books of the
Acquiring Fund's transfer agent for its Class A shares. The Acquired Fund
Shareholders holding certificates representing their ownership of shares of
beneficial interest of the Acquired Fund shall surrender such certificates or
deliver an affidavit with respect to lost certificates in such form and
accompanied by such surety bonds as the Acquired Fund may require (collectively,
an "Affidavit"), to John Hancock Signature Services, Inc. prior to the Closing
Date. Any Acquired Fund share certificate which remains outstanding on the
Closing Date shall be deemed to be cancelled, shall no longer evidence ownership
of shares of beneficial interest of the Acquired Fund, but shall evidence
ownership of Acquiring Fund Shares as determined in accordance with Paragraph
1.1. Unless and until any such certificate shall be so surrendered or an
Affidavit relating thereto shall be delivered by an Acquired Fund Shareholder,
dividends and other distributions payable by the Acquiring Fund subsequent to
the Liquidation Date with respect to Acquiring Fund Shares shall be paid to such
Acquired Fund Shareholder, but such Acquired Fund Shareholder may not redeem or
transfer Acquiring Fund Shares received in the Reorganization. The Acquiring
Fund will not issue share certificates in the Reorganization.

1.7 Any transfer taxes payable upon issuance of Acquiring Fund Shares in a name
other than the registered holder of the Acquired Fund Shares on the books of the
Acquired Fund as of that time shall, as a condition of such issuance and
transfer, be paid by the person to whom such Acquiring Fund Shares are to be
issued and transferred.

1.8 The Acquired Fund shall, following the Closing Date, the transfer of the
Acquired Assets by the Acquired Fund to the Acquiring Fund, the assumption of
the Assumed Liabilities by the Acquiring Fund, and distribution of the Acquiring
Fund Shares by the Acquired Fund to the Acquired Fund Shareholders pursuant to
Paragraph 1.6, be terminated as a series of the Trust under the laws of the
Commonwealth of Massachusetts and in accordance with the Trust's Declaration of
Trust and By-Laws.

1.9 Any reporting responsibility of the Trust with respect to the Acquired Fund,
including, but not limited to, the responsibility for filing of regulatory
reports, Tax Returns, or other documents with the Commission, any state
securities commissions, and any federal, state or local tax authorities or any
other relevant regulatory authority, is and shall remain the responsibility of
the Trust.

2. VALUATION

2.1 The NAV of the Acquiring Fund Shares and the NAV of the Acquired Assets
shall, in each case, be determined as of the close of business (4:00 p.m.,
Boston time) on the Closing Date (the "Valuation Time"). The NAV of each
Acquiring Fund Share shall be computed by The Bank of New York (the "Acquiring
Fund Custodian") in the manner set forth in the Acquiring Trust's Declaration of
Trust as amended and restated (the "Declaration"), or By-Laws, and the Acquiring
Fund's then-current prospectus and statement of additional information;
provided, however, if the Acquiring Fund has no assets as of the Closing Date,
the NAV of each Acquiring Fund Share shall be the same as the NAV of each share
of the Acquired Fund. The NAV of the Acquired Assets shall be computed by
Firstar Institutional Custody Services (the "Acquired Fund Custodian") by
calculating the value of the Acquired Assets and by subtracting therefrom the
amount of the liabilities of the Acquired Fund on the Closing Date included on
the face of the Statement of Assets and Liabilities of the Acquired Fund
delivered pursuant to Section 5.7, said assets and liabilities to be valued in
the manner set forth in the Acquired Fund's then current prospectus and
statement of additional information. The Acquiring Fund Custodian shall confirm
the NAV of the Acquired Assets.

2.2 The number of Acquiring Fund Shares to be issued (including fractional
shares, if any) in exchange for the Acquired Assets and the assumption of the
Assumed Liabilities shall be determined by the Acquiring Fund Custodian by
dividing the NAV of the Acquired Assets, as determined in accordance with
Paragraph 2.1, by the NAV of each Acquiring Fund Share, as determined in
accordance with Paragraph 2.1.

2.3 The Acquiring Fund and the Acquired Fund shall cause the Acquiring Fund
Custodian and the Acquired Fund Custodian, respectively, to deliver a copy of
its valuation report, reviewed by its independent accountants, to the other
party at Closing. All computations of value shall be made by the Acquiring Fund
Custodian and the Acquired Fund Custodian in accordance with its regular
practice as custodian and pricing agent for the Acquiring Fund and the Acquired
Fund, respectively.

3. CLOSING AND CLOSING DATE

3.1 The Closing Date shall be May 17, 2002 or such later date as the parties
may agree to in writing (the "Closing Date"). All acts taking place at the
Closing shall be deemed to take place simultaneously as of 5:00 p.m. (Eastern
time) on the Closing Date unless otherwise provided (the "Closing"). The Closing
shall be held at the offices of Hale and Dorr LLP, 60 State Street, Boston,
Massachusetts, or at such other place as the parties may agree.

3.2 Portfolio securities that are not held in book-entry form in the name of the
Acquired Fund Custodian, as custodian of the Acquired Fund, as record holder for
the Acquired Fund shall be presented by the Acquired Fund to the Acquiring Fund
Custodian for examination no later than three business days preceding the
Closing Date. Portfolio securities which are not held in book-entry form shall
be delivered by the Acquired Fund to the Acquiring Fund Custodian for the
account of the Acquiring Fund on the Closing Date, duly endorsed in proper form
for transfer, in such condition as to constitute good delivery thereof in
accordance with the custom of brokers, and shall be accompanied by all necessary
federal and state stock transfer stamps or a check for the appropriate purchase
price thereof. Portfolio securities held of record by the Acquired Fund
Custodian in book-entry form on behalf of the Acquired Fund shall be delivered
to the Acquiring Fund by the Acquired Fund Custodian by recording the transfer
of beneficial ownership thereof on its records.

3.3 The Acquiring Fund Custodian shall deliver at the Closing a certificate of
an authorized officer stating that: (a) the Acquired Assets have been delivered
in proper form to the Acquiring Fund on the Closing Date, and (b) all necessary
transfer taxes including all applicable federal and state stock transfer stamps,
if any, have been paid, or provision for payment shall have been made in
conjunction with the delivery of portfolio securities as part of the Acquired
Assets. Any cash delivered shall be in the form of currency or by the Acquired
Fund Custodian crediting the Acquiring Fund's account maintained with the
Acquiring Fund Custodian with immediately available funds by wire transfer
pursuant to instruction delivered prior to Closing.

3.4 In the event that on the Closing Date (a) the New York Stock Exchange shall
be closed to trading or trading thereon shall be restricted, or (b) trading or
the reporting of trading on such exchange or elsewhere shall be disrupted so
that accurate appraisal of the NAV of the Acquiring Fund Shares or the Acquired
Assets pursuant to Paragraph 2.1 is impracticable, the Closing Date shall be
postponed until the first business day after the day when trading shall have
been fully resumed and reporting shall have been restored.

3.5 The Acquired Fund shall deliver at the Closing a list of the names,
addresses, federal taxpayer identification numbers and backup withholding and
nonresident alien withholding status of the Acquired Fund Shareholders and the
number and percentage

ownership of outstanding shares of beneficial interest of the Acquired Fund
owned by each such Acquired Fund Shareholder as of the Valuation Time, certified
by the President or a Vice President of the Trust and its Treasurer, Secretary
or other authorized officer (the "Shareholder List") as being an accurate record
of the information (a) provided by the Acquired Fund Shareholders, (b) provided
by the Acquired Fund Custodian, or (b) derived from the Trust's records by such
officers or one of the Trust's service providers. The Acquiring Fund shall issue
and deliver to the Acquired Fund a confirmation evidencing the Acquiring Fund
Shares to be credited on the Closing Date, or provide evidence satisfactory to
the Acquired Fund that such Acquiring Fund Shares have been credited to the
Acquired Fund's account on the books of the Acquiring Fund. At the Closing, each
party shall deliver to the other such bills of sale, checks, assignments, stock
certificates, receipts or other documents as such other party or its counsel may
reasonably request.

4. REPRESENTATIONS AND WARRANTIES

4.1 Except as set forth on Schedule 4.1 hereto, the Trust, on behalf of the
Acquired Fund, represents, warrants and covenants to the Acquiring Fund, which
representations, warrantees and covenants will be true and correct on the date
hereof and on the Closing Date as though made on and as of the Closing Date, as
follows:

(a) The Acquired Fund is a series of the Trust. The Trust is a business trust
validly existing and in good standing under the laws of the Commonwealth
of Massachusetts and has the power to own all of its properties and assets
and, subject to approval by the Acquired Fund Shareholders, to perform its
obligations under this Agreement. The Acquired Fund is not required to
qualify to do business in any jurisdiction in which it is not so qualified
or where failure to qualify would subject it to any material liability or
disability. Each of the Trust and the Acquired Fund has all necessary
federal, state and local authorizations to own all of its properties and
assets and to carry on its business as now being conducted;

(b) The Trust is a registered investment company classified as a management
company of the open-end type, and its registration with the Commission as
an investment company under the Investment Company Act is in full force
and effect. The Acquired Fund is a non-diversified investment company
under the Investment Company Act;

(c) The Trust is not in violation of, and the execution, delivery and
performance of its obligations under this Agreement in respect of the
Acquired Fund will not result in a violation of, any provision of the
Acquired Fund's Declaration of Trust (the "Acquired Fund's Declaration")
or By-Laws or any material agreement, indenture, instrument, contract,
lease or other undertaking with respect to the Acquired Fund to which the
Trust is a party or by which the Acquired Fund or its assets are bound;

(d) No litigation or administrative proceeding or investigation of or before
any court or governmental body is currently pending or to its knowledge
threatened against the Trust or the Acquired Fund or any of the Acquired
Fund's properties or assets. The Acquired Fund knows of no facts which
might form the basis for the institution of such proceedings. Neither the
Trust nor the Acquired Fund is a party to or subject to the provisions of
any order, decree or judgment of any court or governmental body which
materially adversely affects the Acquired Fund's business or its ability
to consummate the transactions herein contemplated and that will be
binding upon the Acquiring Fund as the successor to the Acquired Fund;

(e) The Acquired Fund has no material contracts or other commitments (other
than this Agreement or agreements for the purchase and sale of securities
entered into in the ordinary course of business and consistent with its
obligations under this Agreement) which will not be terminated without
material liability to the Acquired Fund (or the Acquiring Fund) at or
prior to the Closing Date;

(f) The statement of assets and liabilities of the Acquired Fund, and the
related statements of income and changes in net asset value as of and for
the period ended June 30, 2001 has been audited by Ernst & Young LLP,
independent certified public accountants, and are in accordance with GAAP
consistently applied and fairly reflect, in all material respects, the
financial condition of the Acquired Fund as of such dates and the results
of its operations for the periods then ended, and there were no known
actual or contingent liabilities of the Acquired Fund as of the respective
dates thereof not disclosed therein. The Statement of Assets and
Liabilities of the Acquired Fund to be delivered as of the Closing Date
pursuant to Paragraph 5.7 will be in accordance with GAAP consistently
applied and will fairly reflect, in all material respects, the financial
condition of the Acquired Fund as of such date and the results of its
operations for the period then ended. Except for the Assumed Liabilities,
the Acquired Fund will not have any known or contingent liabilities on the
Closing Date;

(g) Since June 30, 2001, except as specifically disclosed in the Acquired
Fund's prospectus or statement of additional information as in effect on
the date of this Agreement, there has not been any material adverse change
in the Acquired Fund's financial condition, assets, liabilities, business
or prospects, or any incurrence by the Acquired Fund of indebtedness,
except for normal contractual obligations incurred in the ordinary course
of business or in connection with the settlement of purchases and sales of
portfolio securities. For the purposes of this subparagraph (g) (but not
for any other purpose of this Agreement including Section 7.4), a decline
in NAV per share of the Acquired Fund arising out of its normal investment

operations or a decline in market values of securities in the Acquired
Fund's portfolio or a decline in net assets of the Acquired Fund as a
result of redemptions shall not constitute a material adverse change;

(h) (A) For each taxable year of its operation since its inception
(including the current taxable year), the Acquired Fund has met the
requirements of Subchapter M of the Code for qualification and treatment
as a regulated investment company and has elected to be treated as such
and will qualify as such as of the Closing Date and will satisfy the
diversification requirements of Section 851(b)(3) of the Code without
regard to Section 851(d) of the Code. The Acquired Fund has not taken any
action which has caused or will cause the Acquired Fund to fail to qualify
as a regulated investment company under the Code. The Acquired Fund has
neither (i) been notified that any Tax Return or other filing of the
Acquired Fund has been reviewed or audited (or that such a review or audit
is currently in process or contemplated) by any federal, state, local or
foreign taxing authority, nor (ii) been informed by any jurisdiction that
the jurisdiction believes that the Acquired Fund was required to file any
Tax Return that was not filed; and the Acquired Fund does not know of any
basis upon which a jurisdiction could assert such a position.

(B) Within the times and in the manner prescribed by law, the
Acquired Fund has filed Tax Returns, and all Tax Returns were complete and
accurate in all material respects;

(C) The Acquired Fund has timely paid, in the manner prescribed by
law, all Taxes, interest, penalties, assessments and deficiencies which
have become due or which have been claimed to be due, and has made
adequate provision for all such amounts which have not yet become due;

(D) All Tax Returns filed by the Acquired Fund constitute complete
and accurate reports of the respective Tax liabilities of the Acquired
Fund or, in the case of information returns and payee statements, the
amounts required to be reported and accurately set forth all items
required to be included or reflected in such returns except for such
instances of misreporting with respect to which, individually or in the
aggregate, the Acquired Fund is not required to notify any shareholder or
any governmental or regulatory authority or agency;

(E) The Acquired Fund has not waived or extended any applicable
statute of limitations relating to the assessment of federal, state, local
or foreign taxes; and

(F) The Acquired Fund has not been notified that any examinations of
the federal, state, local or foreign Tax Returns of the Acquired Fund are
currently in progress or threatened, and no deficiencies have been
asserted or assessed against the Acquired Fund as a result of any audit by
the Internal Revenue Service or any state, local or foreign taxing
authority, and no such deficiency has been proposed or threatened;

(G) The Acquired Fund has no actual or potential liability for any
Tax obligation of any taxpayer other than itself. Acquired Fund is not and
has never been a member of a group of corporations with which it has filed
(or been required to file) consolidated, combined or unitary Tax Returns.
The Acquired Fund is not a party to any Tax allocation, sharing, or
indemnification agreement;

(H) The unpaid Taxes of the Acquired Fund for tax periods through
the Closing Date do not exceed the accruals and reserves for Taxes
(excluding accruals and reserves for deferred Taxes established to reflect
timing differences between book and Tax income) set forth on the Statement
of Assets and Liabilities (rather than in any notes thereto). All Taxes
that the the Acquired Fund is or was required by law to withhold or
collect have been duly withheld or collected and, to the extent required,
have been paid to the proper court, arbitrational tribunal, administrative
agency or commission or other governmental or regulatory authority or
agency;

(I) The Acquired Fund has delivered to Acquiring Fund or made
available to Acquiring Fund complete and accurate copies of all Tax
Returns of the Acquired Fund, together with all related examination
reports and statements of deficiency for all periods not closed under the
applicable statutes of limitations. The Acquired Fund has disclosed on its
federal income Tax Returns all positions taken therein that could give
rise to a substantial understatement of federal income Tax within the
meaning of Section 6662 of the Code.;

(J) The Acquired Fund: (i) is not a "consenting corporation" within
the meaning of Section 341(f) of the Code, and none of the assets of the
Acquired Fund are subject to an election under Section 341(f) of the Code;
and (ii) has not been a United States real property holding corporation
with the meaning of Section 897(c)(2) of the Code during the applicable
period specified in Section 897(c)(1)(A)(ii) of the Code;

(K) None of the assets of the Acquired Fund: (i) is property that is
required to be treated as being owned by any other person pursuant to the
provisions of former Section 168(f)(8) of the Code; (ii) is "tax-exempt
use property" within the

meaning of Section 168(h) of the Code; or (iii) directly or indirectly
secures any debt the interest on which is tax-exempt under Section 103(a)
of the Code;

(L) The Acquired Fund has not undergone, has not agreed to undergo,
and is not required to undergo (nor will it be required as a result of the
transactions contemplated in this Agreement to undergo) a change in its
method of accounting resulting in an adjustment to its taxable income
pursuant to Section 481 of the Code. The Acquired Fund will not be
required to include any item of income in, or exclude any item of
deduction from, taxable income for any taxable period (or portion thereof)
ending after the Closing Date as a result of any (i) change in method of
accounting for a taxable period ending on or prior to the Closing Date
under Section 481(c) of the Code (or any corresponding or similar
provision of state, local or foreign income Tax law); (ii) "closing
agreement" as described in Section 7121 of the Code (or any corresponding
or similar provision of state, local or foreign income Tax law) executed
on or prior to the Closing Date; (iii) installment sale or open
transaction disposition made on or prior to the Closing Date; or (iv)
prepaid amount received on or prior to the Closing Date;

(M) The Acquired Fund has not taken or agreed to take any action
that would prevent the Reorganization from constituting a reorganization
qualifying under Section 368(a) of the Code. The Acquired Fund is not
aware of any agreement, plan or other circumstance that would prevent the
Reorganization from qualifying as a reorganization under Section 368(a) of
the Code;

(N) There are (and as of immediately following the Closing there
will be) no liens on the assets of the Acquired Fund relating to or
attributable to Taxes, except for Taxes not yet due and payable;

(O) The Acquired Fund has not participated in or cooperated with,
nor will it, prior to the Closing Date, participate in or cooperate with,
an international boycott within the meaning of Section 999 of the Code;

(P) The Tax bases of the assets of the Acquired are accurately
reflected on the Acquired Fund's Tax books and records;

(Q) The Acquired Fund has not incurred (or been allocated) an
"overall foreign loss" as defined in Section 904(f)(2) of the Code which
has not been previously recaptured in full as provided in Sections
904(f)(2) and/or 904(f)(3) of the Code;

(R) The Acquired Fund is not a party to a gain recognition agreement
under Section 367 of the Code;

(S) The Acquired Fund does not own any interest in an entity that is
characterized as a partnership for federal income tax purposes;

(T) The Acquired Fund's Tax attributes are not limited, and will not
be limited as a result of the Reorganization, under the Code (including
but not limited to any capital loss carryforward limitations under
Sections 382 or 383 of the Code and the Treasury Regulations thereunder)
or comparable provisions of state law; and

(U) For purposes of this Agreement, "Taxes" shall mean all taxes,
charges, fees, levies or other similar assessments or liabilities,
including without limitation income, gross receipts, ad valorem, premium,
value-added, excise, real property, personal property, sales, use,
transfer, withholding, employment, unemployment, insurance, social
security, business license, business organization, environmental, workers
compensation, payroll, profits, license, lease, service, service use,
severance, stamp, occupation, windfall profits, customs, duties, franchise
and other taxes imposed by the United States of America or any state,
local or foreign government, or any agency thereof, or other political
subdivision of the United States or any such government, and any interest,
fines, penalties, assessments or additions to tax resulting from,
attributable to or incurred in connection with any tax or any contest or
dispute thereof; and "Tax Returns" shall mean all reports, returns,
declarations, statements or other information required to be supplied to a
governmental or regulatory authority or agency, or to any other person, in
connection with Taxes and any associated schedules or work papers produced
in connection with such items.

(i) The authorized capital of the Acquired Fund consists of an unlimited
number of shares of beneficial interest, no par value. All issued and
outstanding shares of beneficial interest of the Acquired Fund are, and at
the Closing Date will be, duly and validly issued and outstanding, fully
paid and nonassessable by the Acquired Fund. All of the issued and
outstanding shares of beneficial interest of the Acquired Fund will, at
the time of Closing, be held of record by the persons and in the amounts
set forth in the Shareholder List submitted to the Acquiring Fund pursuant
to Paragraph 3.5 hereof. The Acquired Fund does not have outstanding any
options, warrants or other rights to subscribe for or purchase any of its
shares of beneficial interest of the Acquired Fund, nor is there
outstanding any security convertible into any of its shares of beneficial
interest of the Acquired Fund;

(j) At the Closing Date, the Acquired Fund will have good and marketable title
to the Acquired Assets, and full right, power and authority to sell,
assign, transfer and deliver the Acquired Assets to the Acquiring Fund,
and, upon delivery and payment for

the Acquired Assets, the Acquiring Fund will acquire good and marketable
title thereto, subject to no restrictions on the full transfer thereof,
except such restrictions as might arise under the Securities Act;

(k) The Trust has the trust power and authority to enter into and perform its
obligations under this Agreement. The execution, delivery and performance
of this Agreement has been duly authorized by all necessary action on the
part of the Trust's Board of Trustees, and, subject to the approval of the
Acquired Fund Shareholders, assuming due authorization, execution and
delivery by the Acquiring Fund, this Agreement will constitute a valid and
binding obligation of the Acquired Fund, enforceable in accordance with
its terms, subject as to enforcement, bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or affecting
creditors' rights and to general equity principles;

(l) The information to be furnished by Yeager, Wood & Marshall, Incorporated
or the Acquired Fund to the Acquiring Fund for use in applications for
orders, registration statements, proxy materials and other documents which
may be necessary in connection with the transactions contemplated hereby
and any information necessary to compute the total return of the Acquired
Fund shall be accurate and complete and shall comply in all material
respects with federal securities and other laws and regulations thereunder
applicable thereto;

(m) The information included in the proxy statement (the "Proxy Statement")
forming part of the Acquiring Trust's Registration Statement on Form N-14
filed in connection with this Agreement (the "Registration Statement")
that has been furnished by the Acquired Fund to the Acquiring Fund for
inclusion in the Registration Statement, on the effective date of that
Registration Statement and on the Closing Date, will conform in all
material respects to the applicable requirements of the Securities Act,
the Securities Exchange Act of 1934 (the "Exchange Act"), and the
Investment Company Act and the rules and regulations of the Commission
thereunder and will not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading;

(n) Upon the effectiveness of the Registration Statement, no consent,
approval, authorization or order of any court or governmental authority is
required for the consummation by the Trust or the Acquired Fund of the
transactions contemplated by this Agreement;

(o) All of the issued and outstanding shares of beneficial interest of the
Acquired Fund have been offered for sale and sold in conformity with all
applicable federal and state securities laws, except as may have been
previously disclosed in writing to the Acquiring Fund;

(p) The prospectus and statement of additional information of the Acquired
Fund, each dated October 29, 2001 (collectively, the "Acquired Fund
Prospectus"), and any amendments or supplements thereto, furnished to the
Acquiring Fund, did not as of their dates or the dates of their
distribution to the public contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances in
which such statements were made, not misleading;

(q) The Acquired Fund currently complies in all material respects with and
since its organization has complied in all material respects with the
requirements of, and the rules and regulations under, the Investment
Company Act, the Securities Act, the Exchange Act, state "Blue Sky" laws
and all other applicable federal and state laws or regulations. The
Acquired Fund currently complies in all material respects with, and since
its organization has complied in all material respects with, all
investment objectives, policies, guidelines and restrictions and any
compliance procedures established by the Trust with respect to the
Acquired Fund. All advertising and sales material used by the Acquired
Fund complies in all material respects with and has complied in all
material respects with the applicable requirements of the Securities Act,
the Investment Company Act, the rules and regulations of the Commission,
and, to the extent applicable, the Conduct Rules of the National
Association of Securities Dealers, Inc. (the "NASD") and any applicable
state regulatory authority. All registration statements, prospectuses,
reports, proxy materials or other filings required to be made or filed
with the Commission, the NASD or any state securities authorities by the
Acquired Fund have been duly filed and have been approved or declared
effective, if such approval or declaration of effectiveness is required by
law. Such registration statements, prospectuses, reports, proxy materials
and other filings under the Securities Act, the Exchange Act and the
Investment Company Act (i) are or were in compliance in all material
respects with the requirements of all applicable statutes and the rules
and regulations thereunder and (ii) do not or did not contain any untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of
the circumstances in which they were made, not false or misleading;

(r) The Acquired Fund has previously provided to the Acquiring Fund (and will
at the Closing provide an update through the Closing Date of such
information) data which supports a calculation of the Acquired Fund's
total return for all periods since the organization of the Acquired Fund.
Such data has been prepared in accordance in all material respects with
the requirements of the Investment Company Act and the regulation
thereunder and the rules of the NASD;

(s) Neither the Acquired Fund nor, to the knowledge of the Acquired Fund, any
"affiliated person" of the Acquired Fund has been convicted of any felony
or misdemeanor, described in Section 9(a)(1) of the Investment Company
Act, nor, to the knowledge of the Acquired Fund, has any affiliated person
of the Acquired Fund been the subject, or presently is the subject, of any
proceeding or investigation with respect to any disqualification that
would be a basis for denial, suspension or revocation of registration as
an investment adviser under Section 203(e) of the Investment Advisers Act
or Rule 206(4)-4(b) thereunder or of a broker-dealer under Section 15 of
the Exchange Act, or for disqualification as an investment adviser,
employee, officer or director of an investment company under Section 9 of
the Investment Company Act; and

(t) The Acquired Fund Tax Representation Certificate to be delivered by the
Acquired Fund to the Acquiring Fund at Closing pursuant to Section 7.6
(the "Acquired Fund Tax Representation Certificate") will not on the
Closing Date contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein not
misleading.

4.2 Except as set forth on Schedule 4.2 hereto, the Acquiring Trust on behalf
of the Acquiring Fund represents, warrants and covenants to the Acquired
Fund, which representations, warranties and covenants will be true and
correct on the date hereof and on the Closing Date as though made on and
as of the Closing Date, as follows:

(a) The Acquiring Trust is a business trust duly organized, validly existing
and in good standing under the laws of the Commonwealth of Massachusetts
and has the power to own all of its properties and assets and to perform
the obligations under this Agreement. Neither the Acquiring Trust nor the
Acquiring Fund is required to qualify to do business in any jurisdiction
in which it is not so qualified or where failure to qualify would subject
it to any material liability or disability. The Acquiring Trust and the
Acquiring Fund have all necessary federal, state and local authorizations
to own all of its properties and assets and to carry on its business as
now being conducted. The Acquiring Fund is a series of the Acquiring Trust
and, as of the Closing Date, will not have any assets or commenced
investment operations;

(b) The Acquiring Trust is a registered investment company classified as a
management company of the open-end type, and its registration with the
Commission as an investment company under the Investment Company Act is in
full force and effect;

(c) The Acquiring Trust's post-effective amendment to its registration
statement on Form N-1A that will be in effect on the Closing Date, and the
prospectus and statement of additional information of the Acquiring Fund
included therein, will conform in all material respects with the
applicable requirements of the Securities Act and the Investment Company
Act and the rules and regulations of the Commission thereunder, and did
not as of its date and will not as of the Closing Date contain any untrue
statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in light
of the circumstances in which they were made, not misleading;

(d) The Registration Statement, the Proxy Statement and statement of
additional information with respect to the Acquiring Fund, each dated
April 12, 2002, and any amendments or supplements thereto on or prior
to the Closing Date included in the Registration Statement (other than
written information furnished by the Acquired Fund for inclusion
therein, as covered by the Acquired Fund's warranty in Paragraph 4.1(m)
hereof) will conform in all material respects to the applicable
requirements of the Securities Act and the Investment Company Act and
the rules and regulations of the Commission thereunder. Neither the
Registration Statement nor the Proxy Statement (other than written
information furnished by the Acquired Fund for inclusion therein, as
covered by the Acquired Fund's warranty in Paragraph 4.1(m) hereof)
includes any untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading;

(e) The Acquiring Trust and the Acquiring Fund are not in violation of, and
the execution and delivery of this Agreement and performance of their
obligations under this Agreement will not result in a violation of, any
provisions of the Acquiring Trust's Declaration or By-Laws or any material
agreement, indenture, instrument, contract, lease or other undertaking
with respect to which the Acquiring Trust or the Acquiring Fund is a party
or by which the Acquiring Trust or the Acquiring Fund or any of their
assets is bound;

(f) No litigation or administrative proceeding or investigation of or before
any court or governmental body is currently pending or threatened against
the Acquiring Trust or the Acquiring Fund or any of the Acquiring Fund's
properties or assets. The Acquiring Trust knows of no facts which might
form the basis for the institution of such proceedings. Neither the
Acquiring Trust nor the Acquiring Fund is a party to or subject to the
provisions of any order, decree or judgment of any court or governmental
body which materially adversely affects the Acquiring Fund's business or
its ability to consummate the transactions contemplated herein;

(g) The Acquiring Fund intends to elect to qualify as a regulated investment
company under Section 851 of the Code. The Acquiring Fund currently
complies in all material respects with and since its organization has
complied in all material respects with the requirements of, and the rules
and regulations under, the Investment Company Act, the Securities Act, the
Exchange Act, state "Blue Sky" laws and all other applicable federal and
state laws or regulations. The Acquiring Fund

currently complies in all material respects with, and since its
organization has complied in all material respects with, all investment
objectives, policies, guidelines and restrictions and any compliance
procedures established by the Acquiring Trust with respect to the
Acquiring Fund. All advertising and sales material used by the Acquired
Fund complies in all material respects with and has complied in all
material respects with the applicable requirements of the Securities Act,
the Investment Company Act, the rules and regulations of the Commission,
and, to the extent applicable, the Conduct Rules of the NASD and any
applicable state regulatory authority. All registration statements,
prospectuses, reports, proxy materials or other filings required to be
made or filed with the Commission, the NASD or any state securities
authorities by the Acquiring Fund have been duly filed and have been
approved or declared effective, if such approval or declaration of
effectiveness is required by law. Such registration statements,
prospectuses, reports, proxy materials and other filings under the
Securities Act, the Exchange Act and the Investment Company Act (i) are or
were in compliance in all material respects with the requirements of all
applicable statutes and the rules and regulations thereunder and (ii) do
not or did not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances in which they were
made, not false or misleading;

(h) The authorized capital of the Acquiring Trust consists of an unlimited
number of shares of beneficial interest, no par value per share. As of the
Closing Date, the Acquiring Fund will be authorized to issue an unlimited
number of shares of beneficial interest, no par value per share. The
Acquiring Fund Shares to be issued and delivered to the Acquired Fund for
the account of the Acquired Fund Shareholders pursuant to the terms of
this Agreement, will have been duly authorized on the Closing Date and,
when so issued and delivered, will be duly and validly issued, fully paid
and non-assessable. The Acquiring Fund does not have outstanding any
options, warrants or other rights to subscribe for or purchase any
Acquiring Fund Shares, nor is there outstanding any security convertible
into any of the Acquiring Fund Shares;

(i) The Acquiring Fund has the trust power and authority to enter into and
perform its obligations under this Agreement. The execution, delivery and
performance of this Agreement by the Acquiring Trust and/or the Acquiring
Fund has been duly authorized by all necessary action on the part of the
Acquiring Trust, the Acquiring Fund and their Board of Trustees, and,
assuming due authorization, execution and delivery by the Acquired Fund,
this Agreement will constitute a valid and binding obligation of the
Acquiring Trust and Acquiring Fund, enforceable in accordance with its
terms, subject as to enforcement, to bankruptcy, insolvency,
reorganization, moratorium and other laws relating to or affecting
creditors' rights and to general equity principles;

(j) The information to be furnished by the Acquiring Trust, the Acquiring Fund
or John Hancock Advisers, LLC for use in applications for orders,
registration statements, proxy materials and other documents which may be
necessary in connection with the transactions contemplated hereby shall be
accurate and complete in all material respects and shall comply in all
material respects with federal securities and other laws and regulations
applicable thereto or the requirements of any form for which its use is
intended, and shall not contain any untrue statement of a material fact or
omit to state a material fact necessary to make the information provided
not misleading;

(k) No consent, approval, authorization or order of or filing with any court
or governmental authority is required for the execution of this Agreement
or the consummation of the transactions contemplated by the Agreement by
the Acquiring Fund or the Acquiring Trust, except for the registration of
the Acquiring Fund Shares under the Securities Act and the Investment
Company Act;

(l) Neither the Acquiring Fund nor, to the knowledge of the Acquiring Fund,
any "affiliated person" of the Acquiring Fund has been convicted of any
felony or misdemeanor, described in Section 9(a)(1) of the Investment
Company Act, nor, to the knowledge of the Acquiring Fund, has any
affiliated person of the Acquiring Fund been the subject, or presently is
the subject, of any proceeding or investigation with respect to any
disqualification that would be a basis for denial, suspension or
revocation of registration as an investment adviser under Section 203(e)
of the Investment Advisers Act of 1940, as amended (the "Investment
Advisers Act") or Rule 206(4)-4(b) thereunder or of a broker-dealer under
Section 15 of the Exchange Act, or for disqualification as an investment
adviser, employee, officer or director of an investment company under
Section 9 of the Investment Company Act; and

(m) The Acquiring Fund Tax Representation Certificate to be delivered by the
Acquiring Fund to the Acquired Fund at Closing pursuant to Section 6.3
(the "Acquiring Fund Tax Representation Certificate") will not on the
Closing Date contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein not
misleading.

5. COVENANTS OF EACH OF THE ACQUIRING FUND AND THE ACQUIRED FUND

5.1 The Acquired Fund will operate the Acquired Fund's business in the ordinary
course between the date hereof and the Closing Date. It is understood that such
ordinary course of business will include the declaration and payment of
customary dividends and distributions and any other dividends and distributions
necessary or advisable (except to the extent dividends or distributions that

are not customary may be limited by representations made in connection with the
issuance of the tax opinion described in paragraph 8.5 hereof), in each case
payable either in cash or in additional shares.

5.2 The Trust will call a special meeting of Acquired Fund Shareholders to
consider approval of this Agreement and act upon the matters set forth in the
Proxy Statement.

5.3 The Acquiring Trust will prepare the notice of meeting, form of proxy and
Proxy Statement (collectively, "Proxy Materials") to be used in connection with
such meeting, and will promptly prepare and file with the Commission the
Registration Statement on Form N-14 relating to the Reorganization. The Trust
will provide the Acquiring Trust with information reasonably necessary for the
preparation of the Registration Statement in compliance with the Securities Act,
the Exchange Act, and the Investment Company Act.

5.4 The Acquired Fund covenants that the Acquiring Fund Shares to be issued
hereunder are not being acquired by the Acquired Fund for the purpose of making
any distribution thereof other than in accordance with the terms of this
Agreement.

5.5 The Acquired Fund will assist the Acquiring Fund in obtaining such
information as the Acquiring Fund reasonably requires concerning the beneficial
ownership of the Acquired Fund's shares.

5.6 Subject to the provisions of this Agreement, each of the Acquired Fund and
the Acquiring Fund will take, or cause to be taken, all actions, and do or cause
to be done, all things reasonably necessary, proper or advisable to consummate
the transactions contemplated by this Agreement.

5.7 The Acquired Fund shall furnish to the Acquiring Fund on the Closing Date
the Statement of Assets and Liabilities of the Acquired Fund as of the Closing
Date setting forth the NAV of the Acquired Assets as of the Valuation Time,
which statement shall be prepared in accordance with GAAP consistently applied
and certified by the Trust's Treasurer or Assistant Treasurer. As promptly as
practicable, but in any case within 30 days after the Closing Date, the Trust
shall furnish to the Acquiring Fund, in such form as is reasonably satisfactory
to the Acquiring Fund, a statement of the earnings and profits of the Acquired
Fund for federal income tax purposes, and of any capital loss carryovers and
other items that will be carried over to the Acquiring Fund under the Code, and
which statement will be certified by the Treasurer of the Trust.

5.8 Neither the Acquired Fund nor the Acquiring Fund shall take any action that
is inconsistent with the representations set forth in, with respect to the
Acquired Fund, the Acquired Fund Tax Representation Certificate, and with
respect to the Acquiring Fund, the Acquiring Fund Tax Representation
Certificate.

5.9 The Trust shall maintain errors and omissions insurance covering management
to the Acquired Fund prior to and including the Closing Date.

5.10 From and after the date of this Agreement and until the Closing Date, each
of the Funds and the Acquiring Trust and the Trust shall use its commercially
reasonable efforts to cause the Reorganization to qualify, and will not
knowingly take any action, cause any action to be taken, fail to take any action
or cause any action to fail to be taken which action or failure to act could
prevent the Reorganization from qualifying as a reorganization under the
provisions of Section 368(a) of the Code.

6. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRED FUND

The obligations of the Acquired Fund to complete the transactions provided for
herein shall be, at its election, subject to the performance by the Acquiring
Fund and the Acquiring Trust of all the obligations to be performed by it
hereunder on or before the Closing Date, and, in addition thereto, the following
further conditions, unless waived by the Acquired Fund in writing:

6.1 All representations and warranties by or on behalf of the Acquiring Trust
and the Acquiring Fund contained in this Agreement shall be true and correct as
of the date hereof and, except as they may be affected by the transactions
contemplated by this Agreement, as of the Closing Date with the same force and
effect as if made on and as of the Closing Date;

6.2 The Acquiring Fund shall have delivered to the Acquired Fund a certificate
executed in its name by the Acquiring Trust's President or Vice President and
its Treasurer or Assistant Treasurer, in form and substance satisfactory to the
Acquired Fund and dated as of the Closing Date, to the effect that the
representations and warranties of the Acquiring Trust on behalf of the Acquiring
Fund made in this Agreement are true and correct at and as of the Closing Date,
except as they may be affected by the transactions contemplated by this
Agreement, that each of the conditions to closing in this Section 6 have been
met, and as to such other matters as the Acquired Fund shall reasonably request;

6.3 The Acquiring Fund shall have delivered to the Acquired Fund an Acquiring
Fund Tax Representation Certificate, satisfactory to the Acquired Fund,
substantially in the form attached to this Agreement as Annex A, concerning
certain tax-related matters with respect to the Acquiring Fund;

6.4 The Acquired Fund shall have received at the Closing a favorable opinion of
counsel, who may be an employee or officer of John Hancock Advisers, LLC (based
upon or subject to such representations, assumptions and limitations as such
counsel may deem appropriate or necessary), dated as of the Closing Date, in a
form reasonably satisfactory to Acquired Fund, including, without limitation,
opinions substantially to the effect that (a) the Acquiring Fund Shares to be
issued to the Acquired Fund Shareholders pursuant to this Agreement are duly
registered under the Securities Act on the appropriate form, and are duly
authorized and upon such issuance will be validly issued and outstanding and
fully paid and non-assessable, and no shareholder of the Acquiring Fund has any
preemptive rights to subscription or purchase in respect thereof, and (b) the
Registration Statement has become effective with the Commission and, to the best
of such counsel's knowledge, no stop order suspending the effectiveness thereof
has been issued and no proceedings for that purpose have been instituted or are
pending or threatened; and

6.5 With respect to the Acquiring Fund, the Board of Trustees of the Acquiring
Trust shall have determined that the Reorganization is in the best interests of
the Acquiring Fund and that the interests of the existing shareholders of the
Acquiring Fund would not be diluted as a result of the Reorganization.

7. CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND

The obligations of the Acquiring Fund to complete the transactions provided for
herein shall be, at its election, subject to the performance by the Trust and
Acquired Fund of all the obligations to be performed by it hereunder on or
before the Closing Date and, in addition thereto, the following further
conditions, unless waived by the Acquiring Fund in writing:

7.1 All representations and warranties of the Acquired Fund contained in this
Agreement by or on behalf of the Trust and Acquired Fund shall be true and
correct as of the date hereof and, except as they may be affected by the
transactions contemplated by this Agreement, as of the Closing Date with the
same force and effect as if made on and as of the Closing Date;

7.2 The Trust shall have delivered to the Acquiring Fund the Statement of Assets
and Liabilities of the Acquired Fund pursuant to Paragraph 5.7, together with a
list of its portfolio securities showing the federal income tax bases and
holding periods of such securities, as of the Closing Date, certified by the
Trust's Treasurer or Assistant Treasurer;

7.3 The Acquired Fund, shall have delivered to the Acquiring Fund on the Closing
Date a certificate executed in its name of the Trust on behalf of the Acquired
Fund by its President or Vice President and a Treasurer or Assistant Treasurer,
in form and substance reasonably satisfactory to the Acquiring Fund and dated as
of the Closing Date, to the effect that the representations and warranties of
the Acquired Fund contained in this Agreement are true and correct at and as of
the Closing Date, except as they may be affected by the transactions
contemplated by this Agreement, that each of the conditions to closing in this
Section 7 have been met, and as to such other matters as the Acquiring Fund
shall reasonably request;

7.4 On the Closing Date, the NAV of the Acquired Assets as calculated in
accordance with Section 2.1 (after accounting for subscription and redemption
activity on such date, but prior to the closing of the Reorganization) shall be
no less than $59 million;

7.5 As of the calendar quarter end immediately preceding the Closing Date, the
Acquired Fund shall have for the two year period then ended performance in one
of the top two quartiles of the "Lipper Large Cap Growth" peer group;

7.6 The Acquired Fund shall have delivered to the Acquiring Fund an Acquired
Fund Tax Representation Certificate, satisfactory to the Acquiring Fund,
substantially in the form attached to this Agreement as Annex B, concerning
certain tax-related matters with respect to the Acquired Fund;

7.7 The Trust shall have delivered to the Acquiring Fund a written opinion of
Ernst & Young LLP to the effect that the Acquired Fund has qualified and elected
to be treated as a "regulated investment company" as defined in Section 851 of
the Code for each taxable year since its inception and was diversified under
Section 851(b)(3) of the Code (without regard to Section 851(d) of the Code) at
the close of the Acquired Fund's quarter immediately preceding the Closing Date;
and

7.8 With respect to the Acquired Fund, the Board of Trustees of the Trust shall
have determined that the Reorganization is in the best interests of the Acquired
Fund and that the interests of the existing the Acquired Fund Shareholders would
not be diluted as a result of the Reorganization.

8. FURTHER CONDITIONS PRECEDENT

If any of the conditions set forth below do not exist on or before the Closing
Date with respect to either party hereto, the other party to this Agreement
shall, at its option, not be required to consummate the transactions
contemplated by this Agreement:

8.1 The Agreement and the transactions contemplated herein shall have been
approved by the requisite vote of the Acquired Fund Shareholders in accordance
with the provisions of the Trust's Declaration of Trust and By-Laws, and
certified copies of the resolutions evidencing such approval by the Acquired
Fund's shareholders shall have been delivered by the Acquired Fund to the
Acquiring Fund. Notwithstanding anything herein to the contrary, neither party
hereto may waive the conditions set forth in this Paragraph 8.1;

8.2 On the Closing Date, no action, suit or other proceeding shall be pending
before any court or governmental agency in which it is sought to restrain or
prohibit, or obtain damages or other relief in connection with, this Agreement
or the transactions contemplated herein;

8.3 All consents of other parties and all other consents, orders and permits of
federal, state and local regulatory authorities (including those of the
Commission and of state Blue Sky and securities authorities) deemed necessary by
either party hereto to permit consummation, in all material respects, of the
transactions contemplated hereby shall have been obtained, except where failure
to obtain any such consent, order or permit would not involve a risk of a
material adverse effect on the assets or properties of either party hereto,
provided that either party may waive any such conditions for itself;

8.4 Each of the Acquiring Trust's Registration Statement on Form N-14 and the
post-effective amendment to the Acquiring Trust's Registration Statement on Form
N-1A adding the Acquiring Fund as a series of the Acquiring Trust (and
reflecting the Acquiring Fund as the accounting successor of the Acquired Fund)
shall have become effective under the Securities Act and no stop orders
suspending the effectiveness of either of such Registration Statements shall
have been issued and, to the best knowledge of the parties hereto, no
investigation or proceeding for that purpose shall have been instituted or be
pending, threatened or contemplated under the Securities Act;

8.5 The parties shall have received an opinion of Hale and Dorr LLP,
satisfactory to the Trust and the Acquiring Trust, substantially to the effect
that for federal income tax purposes the acquisition by the Acquiring Fund of
the Acquired Assets solely in exchange for the issuance of Acquiring Fund Shares
to the Acquired Fund and the assumption of the Assumed Liabilities by the
Acquiring Fund, followed by the distribution by the Acquired Fund, in
liquidation of the Acquired Fund, of Acquiring Fund Shares to the Acquired Fund
Shareholders in exchange for their shares of beneficial interest of the Acquired
Fund and the termination of the Acquired Fund, will constitute a
"reorganization" within the meaning of Section 368(a) of the Code.
Notwithstanding anything herein to the contrary, neither the Acquired Fund nor
the Trust may waive the conditions set forth in this Paragraph 8.5.

8.6 Each of the Acquiring Fund and the Acquired Fund agrees to make, to the
extent that it is able to accurately do so, and provide representations with
respect to itself that are reasonably necessary to enable Hale and Dorr LLP to
deliver an opinion substantially as set forth in Paragraph 8.5.

9. BROKERAGE FEES AND EXPENSES

9.1 Each party hereto represents and warrants to the other party hereto that
there are no brokers or finders entitled to receive any payments in connection
with the transactions provided for herein.

9.2 The parties have been informed by John Hancock Advisers, LLC that it will
pay the expenses of the Acquired Fund incurred in connection with the
Reorganization. Except for the foregoing, the Acquiring Fund and the Acquired
Fund shall each bear its own expenses in connection with the transactions
contemplated by this Agreement.

10. ENTIRE AGREEMENT; SURVIVAL OF WARRANTIES

10.1 The Acquiring Fund and the Acquired Fund each agree that neither party has
made any representation, warranty or covenant not set forth herein or referred
to in Paragraphs 4.1 or 4.2 hereof and that this Agreement constitutes the
entire agreement between the parties.

10.2 The representations, warranties and covenants contained in this Agreement
or in any document delivered pursuant hereto or in connection herewith shall
survive the consummation of the transactions contemplated hereunder for a period
of two years following the Closing Date.

11. TERMINATION

11.1 This Agreement may be terminated by the mutual agreement of the Acquiring
Fund and the Acquired Fund. In addition, either party may at its option
terminate this Agreement at or prior to the Closing Date:

(a) because of a material breach by the other of any representation, warranty,
covenant or agreement contained herein to be performed at or prior to the
Closing Date;

(b) because of a condition herein expressed to be precedent to the obligations
of the terminating party which has not been met and which reasonably
appears will not or cannot be met;

(c) by resolution of the Acquiring Trust's Board of Trustees if circumstances
should develop that, in the good faith opinion of such Board, make
proceeding with the Agreement not in the best interests of the Acquiring
Fund's shareholders;

(d) by resolution of the Trust's Board of Trustees if circumstances should
develop that, in the good faith opinion of such Board, make proceeding
with the Agreement not in the best interests of the Acquired Fund
Shareholders; or

(e) if the transactions contemplated by this Agreement shall not have occurred
on or prior to July 31, 2002 or such other date as the parties may
mutually agree upon in writing.

11.2 In the event of any such termination, there shall be no liability for
damages on the part of the Acquiring Trust, the Acquiring Fund, the Trust or the
Acquired Fund, or the Trustees or officers of the Trust or the Acquired Fund,
but each party shall bear the expenses incurred by it incidental to the
preparation and carrying out of this Agreement.

12. AMENDMENTS
This Agreement may be amended, modified or supplemented in such manner as may be
mutually agreed upon in writing by the authorized officers of the Trust and the
Acquiring Trust; provided, however, that following the meeting of the Acquired
Fund Shareholders called by the Trust pursuant to Paragraph 5.2 of this
Agreement, no such amendment may have the effect of changing the provisions
regarding the method for determining the number of Acquiring Fund Shares to be
received by the Acquired Fund Shareholders under this Agreement to the detriment
of the Acquired Fund Shareholders without their further approval; provided that
nothing contained in this Section 12 shall be construed to prohibit the parties
from amending this Agreement to change the Closing Date.

13. NOTICES
Any notice, report, statement or demand required or permitted by any provisions
of this Agreement shall be in writing and shall be given by prepaid telegraph,
telecopy or certified mail addressed to the Acquired Fund, c/o Yeager, Wood &
Marshall, Incorporated, 630 Fifth Avenue, New York, New York, Attention: George
M Yeager, with copies to: Susan S. Newton and the Acquiring Fund c/o John
Hancock Advisers, LLC, 101 Huntington Avenue, Boston Massachusetts Attention:
Maureen Ford, with copies to Hale and Dorr LLP, 60 State Street, Boston,
Massachusetts 02109, Attention: Jeffrey N. Carp, Esq.

14. HEADINGS; COUNTERPARTS; GOVERNING LAW; ASSIGNMENT
14.1 The article and paragraph headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.

14.2 This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original.

14.3 This Agreement shall be governed by and construed in accordance with the
laws of the Commonwealth of Massachusetts.

14.4 This Agreement shall bind and inure to the benefit of the parties hereto
and their respective successors and assigns, but no assignment or transfer
hereof or of any rights or obligations hereunder shall be made by either party
without the prior written consent of the other party hereto. Nothing herein
expressed or implied is intended or shall be construed to confer upon or give
any person, firm or corporation, or other entity, other than the parties hereto
and their respective successors and assigns, any rights or remedies under or by
reason of this Agreement.

14.5 It is expressly agreed that the obligations of the Acquiring Trust and the
Trust shall not be binding upon any of their respective Trustees, shareholders,
nominees, officers, agents or employees personally, but bind only to the trust
property of the Acquiring Fund or the Acquired Fund, as the case may be, as
provided in the trust instruments of the Acquiring Trust and the Trust,
respectively. The execution and delivery of this Agreement have been authorized
by the Trustees of each of the Acquiring

Trust and the Trust and this Agreement has been executed by authorized officers
of the Acquiring Trust and the Trust, acting as such, and neither such
authorization by such Trustees nor such execution and delivery by such officers
shall be deemed to have been made by any of them individually or to imposed any
liability on any of them personally, but shall bind only the trust property of
the Acquiring Fund and the Acquired Fund, as the case may be, as provided in the
trust instruments of the Acquiring Trust and the Trust, respectively.

14.6 The Trust shall indemnify and hold harmless the Acquiring Trust and the
Acquiring Fund and all their respective affiliates, directors, trustees,
officers, employees and agents (collectively, the "Acquiring Group") from and
against any and all claims, losses, judgments, liabilities, settlements, fines,
penalties, interest costs and expenses (including all reasonable attorneys' fees
and disbursements whether incurred in resolving indemnification issues between
or among parties to this Agreement or in defending third-party claims, and
collectively with such claims, etc., "Losses") that result from, arise out of or
are connected with any breach or alleged breach of any representation, warranty
or covenant of the Trust or the Acquired Fund contained in this Agreement. Any
member of the Acquiring Group with an indemnification claim for Losses hereunder
shall notify the Trust in writing of those Losses, together with a reasonably
detailed description, within 30 calendar days after having formed a reasonable
basis for those Losses, provided that the failure to so notify shall not affect
the right to indemnification hereunder except to the extent such failure
resulted in a greater Loss.

14.6 The Acquiring Trust shall indemnify and hold harmless the Trust and the
Acquired Funds and all their respective affiliates, directors, trustees,
officers, employees and agents (collectively, the "Acquired Group") from and
against any and all Losses that result from, arise out of or are connected with
any breach or alleged breach of any representation, warranty or covenant of the
Acquiring Trust or the Acquiring Fund contained in this Agreement. Any member of
the Acquired Group with an indemnification claim for Losses hereunder shall
notify the Acquiring Trust in writing of those Losses, together with a
reasonably detailed description, within 30 calendar days after having formed a
reasonable basis for those Losses, provided that the failure to so notify shall
not affect the right to indemnification hereunder except to the extent such
failure resulted in a greater Loss.

IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
executed as of the date first set forth above by its President or Vice President
and attested by its Secretary or Assistant Secretary.

Attest: PROFESSIONALLY MANAGED PORTFOLIOS
on behalf of
U.S. GLOBAL LEADERS GROWTH FUND

By:_____________________________ By:________________________________________

Name:___________________________ Name:______________________________________

Title: Secretary Title:

Attest: JOHN HANCOCK CAPITAL SERIES,
on behalf of
JOHN HANCOCK U.S.GLOBAL LEADERS GROWTH FUND

By:_____________________________ By:________________________________________

Name:___________________________ Name:______________________________________

Title: Secretary Title:

VOTE THIS PROXY CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE
THE EXPENSE OF ADDITIONAL MAILINGS

U.S. GLOBAL LEADERS GROWTH FUND
SPECIAL MEETING OF SHAREHOLDERS -MAY 8, 2002
PROXY SOLICITATION BY THE BOARD OF TRUSTEES

The undersigned, revoking previous proxies, hereby appoint(s)
_________________, _________________ and _______________, with full power of
substitution in each, to vote all the shares of beneficial interest of U.S.
Global Leaders Growth Fund (your fund) which the undersigned is (are) entitled
to vote at the Special Meeting of Shareholders (the "Meeting") of your fund to
be held at ________________________________, on May 8, 2002 at [10:00 a.m.],
Eastern time, and at any adjournment(s) of the Meeting. All powers may be
exercised by a majority of all proxy holders or substitutes voting or acting,
or, if only one votes and acts, then by that one. Receipt of the Proxy Statement
dated April 12, 2002 is hereby acknowledged. If not revoked, this proxy shall be
voted "for" the proposal.

Date , 2002

PLEASE SIGN, DATE AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE

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

-----------------------------------------------
Signature(s)
NOTE: Signature(s) should
agree with the name(s)
printed herein. When
signing as attorney,
executor, administrator,
trustee or guardian, please
give your full name as
such. If a corporation,
please sign in full
corporate name by president
or other authorized
officer. If a partnership,
please sign in partnership
name by authorized person.

VOTE THIS PROXY CARD TODAY!
YOUR PROMPT RESPONSE WILL SAVE
THE EXPENSE OF ADDITIONAL MAILINGS

THIS PROXY WILL BE VOTED IN FAVOR OF ("FOR") PROPOSAL 1 IF NO SPECIFICATION IS
MADE BELOW. AS TO ANY OTHER MATTER, THE PROXY OR PROXIES WILL VOTE IN ACCORDANCE
WITH THEIR BEST JUDGEMENT.

PLEASE VOTE BY FILLING IN THE APPROPRIATE BOX BELOW

(1) To approve an Agreement and Plan of Reorganization between U.S. Global
Leaders Growth Fund (your fund) and John Hancock U.S. Global Leaders
Growth Fund (the "John Hancock Fund"). Under this Agreement, as more
fully described in the accompanying proxy statement, your fund will
transfer all of its assets to the John Hancock Fund in exchange for
Class A shares of the John Hancock Fund, a newly-created fund with
substantially similar investment policies and strategies as your fund.

FOR |_| AGAINST |_| ABSTAIN |_|

PLEASE DO NOT FORGET TO SIGN THE REVERSE SIDE OF THIS CARD.

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JOHN HANCOCK FUNDS

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Proxy Voting Form
John Hancock Funds
U.S. Global Leaders Growth Fund

THE TRUSTEES RECOMMEND A VOTE "FOR" THE FOLLOWING PROPOSAL.

Proposal 1. To approve an Agreement and Plan of oFOR oAGAINST oABSTAIN
Reorganization between U.S. Global Leaders
Growth Fund (your fund) and John Hancock
U.S. Global Leaders Growth Fund (the "John
Hancock Fund"). Under the Agreement, as more
fully described in the accompanying proxy
statement, your fund will transfer all of
its assets to the John Hancock Fund in
exchange for Class A shares of the John
Hancock Fund, a newly-created fund with
substantially similar investment policies
and strategies as your fund.

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JOHN HANCOCK FUNDS

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John Hancock Funds
U.S. Global Leaders Growth Fund

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THE TRUSTEES RECOMMEND A VOTE "FOR" THE FOLLOWING PROPOSAL.

Proposal 1. To approve an Agreement and Plan of oFOR
Reorganization between U.S. Global Leaders
Growth Fund (your fund) and John Hancock
U.S. Global Leaders Growth Fund (the "John
Hancock Fund"). Under the Agreement, as more
fully described in the accompanying proxy
statement, your fund will transfer all of
its assets to the John Hancock Fund in
exchange for Class A shares of the John
Hancock Fund, a newly-created fund with
substantially similar investment policies
and strategies as your fund.

Please refer to the proxy statement for discussion of each of these matters.

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John Hancock U.S.
Global Leaders
Growth Fund

Prospectus

May 13, 2002

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

Subject to completion: dated April __, 2002

The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and exchange Commission is effective. This prospectus is not an
offer to buy these securities in any state where the offer or sale is not
permitted.

As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved this fund or determined whether the information in this
prospectus is adequate and accurate. Anyone who indicates otherwise is
committing a federal crime.

[LOGO](R)
------------------
JOHN HANCOCK FUNDS

Contents

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A summary of the fund's U.S. Global Leaders Growth Fund 4
goals, strategies, risks,
performance and expenses.

Policies and instructions for Your account
opening, maintaining and
closing an account. Choosing a share class 6
How sales charges are calculated 6
Sales charge reductions and waivers 7
Opening an account 8
Buying shares 9
Selling shares 10
Transaction policies 12
Dividends and account policies 12
Additional investor services 13

Further information on the Fund details
fund.
Business structure 14
Management biographies 15
Financial highlights 16

For more information back cover

U.S. Global Leaders Growth Fund

GOAL AND STRATEGY

[Clip Art] The fund seeks long-term growth of capital. To pursue this goal the
fund invests primarily in common stocks of U.S. companies that have substantial
international activities ("U.S. Global Leaders"). Under normal market
conditions, at least 80% of the fund's assets will be invested in stocks of
companies the Managers regard as U.S. Global Leaders.

The Managers consider U.S. Global Leaders to be companies that typically
exhibit the following key sustainable growth characteristics:

o Hold leading market shares of their relevant growth markets that result in
high profit margins and high investment returns.

o Supply consumable products or services so that their revenue streams are
recurring.

The fund's investment policy is to seek to identify large-capitalization
companies with superior long-term earnings prospects and to continue to own them
as long as the managers believe they will continue to enjoy favorable prospects
for capital growth and are not overvalued in the marketplace.

The fund is non-diversified which allows it to make larger investments in
individual companies.

The fund may invest in other types of equities and foreign stocks. The Fund does
not have a principal investment policy that calls for foreign investing.

In abnormal circumstances, the fund may temporarily invest in short term cash
equivalents. In these and other cases, the fund might not achieve its goal.

The fund anticipates that its portfolio turnover rate will normally not exceed
25%. The lack of frequent trading has the potential to increase tax efficiency
and may lead to lower transaction costs, which could help to improve
performance.

================================================================================

PAST PERFORMANCE

[Clip Art] The graph shows how the fund's total return has varied from year to
year, while the table shows performance over time (along with a broad-based
market index for reference). This information may help to provide an indication
of the fund's risks. Year-by-year and average annual figures for period prior to
May , 2002 reflect the performance of the sole class of U.S. Global Leaders
Growth Fund, the fund's predecessor. On May , 2002, the fund acquired all of the
assets of U.S. Global Leaders Growth Fund pursuant to an agreement and plan of
reorganization in exchange for Class A shares of the fund. The total expenses
for the fund's Class A shares are estimated to be substantially the same as the
predecessor fund's sole class of shares. Annual returns for Classes B and C
should be substantially similar since all classes invest in the same portfolio.
Average annual returns for Classes B and C have been restated to reflect any
applicable sales charges and Rule 12b-1 fees (but not other differences in
expenses). This adjustment may have the effect of reducing the previously
reported performance of the U.S. Global Leaders Growth Fund. Year-by-year and
index figures do not reflect sales charges and would be lower if they did. All
figures assume dividend reinvestment. Past performance does not indicate future
results.

After-tax returns
After-tax returns are shown for Class A shares only and would be different for
the other classes. They are calculated using the historical highest individual
federal marginal income-tax rates and do not reflect the impact of state and
local taxes. Actual after-tax returns depend on the investor's tax situation and
may differ from those shown. The after-tax returns shown are not relevant to
investors who hold their fund shares through tax-deferred arrangements such as
401(k) plans or individual retirement accounts.

Total Returns
Best quarter:
Worst quarter:

Index (reflects no fees or taxes)
Standard & Poor's 500 Index, an unmanaged index of 500 stocks.

- --------------------------------------------------------------------------------
Class A calendar year total returns (without sales charges)
- --------------------------------------------------------------------------------
1996 1997 1998 1999 2000 2001

23.14% 40.46% 31.98% 7.88% 4.15% -6.83%

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Average annual total returns (including sales charge) for periods ending 12-31-01
- --------------------------------------------------------------------------------------------
1 year 5 year Life of
Class A

Class A before tax -6.83% 14.17% 16.13%
Class A after tax on distributions -6.83% 14.17% 16.07%
Class A after tax on distributions, with sale -4.16% 11.87% 13.71%
Class B before tax xx.xx% xx.xx% xx.xx%
Class C before tax xx.xx% xx.xx% xx.xx%
Standard & Poor's 500 Index -11.91% 10.68% 13.13%

MAIN RISKS

[Clip Art] The value of your investment will fluctuate in response to stock
market movements.

The fund's management strategy has a significant influence on fund performance.
Large-capitalization stocks as a group could fall out of favor with the market,
causing the fund to underperform investments that focus on small- or
medium-capitalization stocks. Similarly, growth stocks could underperform value
stocks.

Multinational companies that have substantial international operations may be
affected by fluctuations in currency exchange rates and by economic and
political conditions in foreign countries. These conditions may include
restrictions on monetary repatriation and possible seizure, nationalization or
expropriation of assets. To the extent the fund invests in a given industry, its
performance will be hurt if that industry performs poorly. In addition, if the
managers' security selection strategies do not perform as expected, the fund
could underperform its peers or lose money.

To the extent that the fund makes investments with additional risks, these risks
could increase volatility or reduce performance:

o If the fund invests heavily in a single issuer, its performance could
suffer significantly from adverse events affecting that issuer.

o In a down market, higher-risk securities could become harder to value or
to sell at a fair price.

o Foreign investments carry additional risks, including potentially
unfavorable currency exchange rates, inadequate or inaccurate financial
information and social or political instability.

Investments in the fund are not bank deposits and are not insured or guaranteed
by the Federal Deposit Insurance Corporation or any other government agency. You
could lose money by investing in this fund.

================================================================================

YOUR EXPENSES

[Clip Art] Transaction expenses are charged directly to your account. Operating
expenses are paid from the fund's assets, and therefore are paid by shareholders
indirectly. The figures below show estimated annual expenses. Actual expenses
may be greater or less.

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Shareholder transaction expenses(1) Class A Class B Class C
- --------------------------------------------------------------------------------
Maximum sales charge (load) 5.00% 5.00% 2.00%
Maximum front-end sales charge (load) on purchases
as a % of purchase price 5.00% none 1.00%
Maximum deferred sales charge (load)
as a % of purchase or sale price, whichever is less none(2) 5.00% 1.00%
Maximum redemption fee as a % of amount redeemed(3) 2.00% 2.00% 2.00%

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Annual operating expenses Class A Class B Class C
- -------------------------------------------------------------------------------
Management fee 0.75% 0.75% 0.75%
Distribution and service (12b-1) fees 0.25% 1.00% 1.00%
Other expenses X.XX% X.XX% X.XX%
Total fund operating expenses X.XX% X.XX% X.XX%
Expense reimbursement (at least until _/_/07) X.XX% X.XX% X.XX%
Net annual operating expenses 1.37% 2.12% 2.12%

The hypothetical example below shows what your expenses would be after the
expense reimbursement if you invested $10,000 over the time frames indicated,
assuming you reinvested all distributions and that the average annual return was
5%. The example is for comparison only, and does not represent the fund's actual
expenses and returns, either past or future.

- --------------------------------------------------------------------------------
Expenses Year 1 Year 3
- --------------------------------------------------------------------------------
Class A xxx xxx
Class B with redemption xxx xxx
Class B without redemption xxx xxx
Class C with redemption xxx xxx
Class C without redemption xxx xxx

(1) A $4.00 fee will be charged for wire redemptions.
(2) Except for investments of $1 million or more; see "How sales charges are
calculated."
(3) Fee applies to shares held for less than six months. Fee is payable to
fund to help reduce the cost of short-term trading.

================================================================================

SUBADVISER

Yeager, Wood & Marshall, Inc.

Responsible for day-to-day investment
management

Founded in 1968

Supervised by the adviser

PORTFOLIO MANAGERS

George M. Yeager
Managed fund since XXXX

George P. Fraise
Managed fund since XXXX

See page 15 for the management biographies.

FUND CODES

Class A Ticker --
CUSIP --
Newspaper --
SEC number --
H fund number --

Class B Ticker --
CUSIP --
Newspaper --
SEC number --
H fund number --

Class C Ticker --
CUSIP --
Newspaper --
SEC number --
H fund number --

Your account

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CHOOSING A SHARE CLASS

Each share class has its own cost structure, including a Rule 12b-1 plan that
allows it to pay fees for the sale, distribution and service of its shares. Your
financial representative can help you decide which share class is best for you.

- --------------------------------------------------------------------------------
Class A
- --------------------------------------------------------------------------------

o A front-end sales charge, as described at right.

o Distribution and service (12b-1) fees of 0.25%.

- --------------------------------------------------------------------------------
Class B
- --------------------------------------------------------------------------------

o No front-end sales charge; all your money goes to work for you right away.

o Distribution and service (12b-1) fees of 1.00%.

o A deferred sales charge, as described on following page.

o Automatic conversion to Class A shares after eight years, thus reducing
future annual expenses.

- --------------------------------------------------------------------------------
Class C
- --------------------------------------------------------------------------------

o A front-end sales charge, as described at right.

o Distribution and service (12b-1) fees of 1.00%.

o A 1.00% contingent deferred sales charge on shares sold within one year of
purchase.

o No automatic conversion to Class A shares, so annual expenses continue at
the Class C level throughout the life of your investment.

Because 12b-1 fees are paid on an ongoing basis, they may cost shareholders more
than other types of sales charges.

Investors purchasing $1 million or more of Class B or Class C shares may want to
consider the lower operating expenses of Class A shares.

Your broker receives a percentage of these sales charges and fees. In addition,
John Hancock Funds may pay significant compensation out of its own resources to
your broker.

Your broker or agent may charge you a fee to effect transactions in fund shares.

- --------------------------------------------------------------------------------
HOW SALES CHARGES ARE CALCULATED

Class A and Class C Sales charges are as follows:

- --------------------------------------------------------------------------------
Class A sales charges
- --------------------------------------------------------------------------------
As a % of As a % of your
Your investment offering price investment
Up to $49,999 5.00% 5.26%
$50,000 - $99,999 4.50% 4.71%
$100,000 - $249,999 3.50% 3.63%
$250,000 - $499,000 2.50% 2.56%
$500,000 - $999,999 2.00% 2.04%
$1,000,000 and over See below

- --------------------------------------------------------------------------------
Class C sales charges
- --------------------------------------------------------------------------------
As a % of As a % of your
Your investment offering price investment
Up to $1,000,000 1.00% 1.01%
$1,000,000 and over none

Investments of $1 million or more Class A and Class C shares are available with
no front-end sales charge. However, there is a contingent deferred sales charge
(CDSC) on any Class A shares sold within one year of purchase, as follows:

- --------------------------------------------------------------------------------
CDSC on $1 million+ investments
- --------------------------------------------------------------------------------
CDSC on shares
Your investment being sold
First $1M - $4,999,999 1.00%
Next $1 - $5M above that 0.50%
Next $1 or more above that 0.25%

For purposes of this CDSC, all purchases made during a calendar month are
counted as having been made on the first day of that month.

6 YOUR ACCOUNT

The CDSC is based on the lesser of the original purchase cost or the current
market value of the shares being sold, and is not charged on shares you acquired
by reinvesting your dividends. To keep your CDSC as low as possible, each time
you place a request to sell shares we will first sell any shares in your account
that are not subject to a CDSC.

Class B Shares are offered at their net asset value per share, without any
initial sales charge.

Class B and Class C A CDSC may be charged if you sell Class B or Class C shares
within a certain time after you bought them, as described in the tables below.
There is no CDSC on shares acquired through reinvestment of dividends. The CDSC
is based on the original purchase cost or the current market value of the shares
being sold, whichever is less. The CDSCs are as follows:

- --------------------------------------------------------------------------------
Class B deferred charges
- --------------------------------------------------------------------------------
Years after purchase CDSC on shares being sold
1st year 5.00%
2nd year 4.00%
3rd or 4th year 3.00%
5th year 2.00%
6th year 1.00%
After 6th year none

- --------------------------------------------------------------------------------
Class C deferred charges
- --------------------------------------------------------------------------------
Years after purchase CDSC
1st year 1.00%
After 1st year none

For purposes of these CDSCs, all purchases made during a calendar month are
counted as having been made on the first day of that month.

CDSC calculations are based on the number of shares involved, not on the value
of your account. To keep your CDSC as low as possible, each time you place a
request to sell shares we will first sell any shares in your account that carry
no CDSC. If there are not enough of these to meet your request, we will sell
those shares that have the lowest CDSC.

SALES CHARGE REDUCTIONS AND WAIVERS

Reducing your Class A sales charges There are several ways you can combine
multiple purchases of Class A shares of John Hancock funds to take advantage of
the breakpoints in the sales charge schedule. The first three ways can be
combined in any manner.

o Accumulation Privilege -- lets you add the value of any Class A shares you
already own to the amount of your next Class A investment for purposes of
calculating the sales charge. Retirement plans investing $1 million in
Class B shares may add that value to Class A purchases to calculate
charges.

o Letter of Intention -- lets you purchase Class A shares of a fund over a
13-month period and receive the same sales charge as if all shares had
been purchased at once.

o Combination Privilege -- lets you combine Class A shares of multiple funds
for purposes of calculating the sales charge.

To utilize: complete the appropriate section of your application, or contact
your financial representative or Signature Services, or consult the SAI (see the
back cover of this prospectus).

Group Investment Program A group may be treated as a single purchaser under the
accumulation and combination privileges. Each investor has an individual
account, but the group's investments are lumped together for sales charge
purposes, making the investors potentially eligible for reduced sales charges.
There is no charge or obligation to invest (although initial investments must
total at least $250) and individual investors may close their accounts at any
time.

To utilize: contact your financial representative or Signature Services to find
out how to qualify, or consult the SAI (see the back cover of the prospectus).

CDSC waivers As long as Signature Services is notified at the time you sell, the
CDSC for each share class will generally be waived in the following cases:

o to make payments through certain systematic withdrawal plans

o to make certain distributions from a retirement plan

o because of shareholder death or disability

To utilize: If you think you may be eligible for a CDSC waiver, contact your
financial representative or Signature Services, or consult the SAI (see the back
cover of this prospectus).

YOUR ACCOUNT 7

Reinstatement privilege If you sell shares of a John Hancock fund, you may
reinvest some or all of the proceeds in the same share class of any John Hancock
fund within 120 days without a sales charge, as long as Signature Services is
notified before you reinvest. If you paid a CDSC when you sold your shares, you
will be credited with the amount of the CDSC. All accounts involved must have
the same registration.

To utilize: contact your financial representative or Signature Services.

Waivers for certain investors Class A shares may be offered without front-end
sales charges or CDSCs to various individuals and institutions, including:

o selling brokers and their employees and sales representatives

o financial representatives utilizing fund shares in fee-based investment
products under signed agreement with John Hancock Funds

o fund trustees and other individuals who are affiliated with these or other
John Hancock funds

o individuals transferring assets from an employee benefit plan into a John
Hancock fund

o participants in certain retirement plans with at least 100 eligible
employees (one-year CDSC applies)

o Any shareholder of U.S. Global Leaders Growth Fund as of May 13, 2002

Class C shares may be offered without front-end sales charges to various
individuals and institutions, including certain retirement plans.

To utilize: if you think you may be eligible for a sales charge waiver, contact
Signature Services or consult the SAI (see the back cover of this prospectus).

- --------------------------------------------------------------------------------
OPENING AN ACCOUNT

1 Read this prospectus carefully.

2 Determine how much you want to invest. The minimum initial investments for
the John Hancock funds are as follows:

o non-retirement account: $1,000

o retirement account: $250

o group investments: $250

o Monthly Automatic Accumulation Plan (MAAP): $25 to open; you must
invest at least $25 a month

o fee-based clients of selling brokers who have placed at least $2
billion in John Hancock funds: $250

3 Complete the appropriate parts of the account application, carefully
following the instructions. You must submit additional documentation when
opening trust, corporate or power of attorney accounts. You must notify
your financial representative or Signature Services if this information
changes. For more details, please contact your financial representative or
call Signature Services at 1-800-225-5291.

4 Complete the appropriate parts of the account privileges application. By
applying for privileges now, you can avoid the delay and inconvenience of
having to file an additional application if you want to add privileges
later.

5 Make your initial investment using the table on the next page. You and
your financial representative can initiate any purchase, exchange or sale
of shares.

8 YOUR ACCOUNT

- --------------------------------------------------------------------------------
Buying shares
- --------------------------------------------------------------------------------
Opening an account Adding to an account

By check

[Clip Art] o Make out a check for the o Make out a check for the
investment amount, payable to investment amount payable to
"John Hancock Signature "John Hancock Signature
Services, Inc." Services, Inc."

o Deliver the check and your o Fill out the detachable
completed application to your investment slip from an
financial representative, or account statement. If no slip
mail them to Signature is available, include a note
Services (address below). specifying the fund name,
your share class, your
account number and the
name(s) in which the account
is registered.

o Deliver the check and your
investment slip or note to
your financial
representative, or mail them
to Signature Services
(address below).

By exchange

[Clip Art] o Call your financial o Log on to www.jhfunds.com to
representative or Signature process exchanges between
Services to request an funds.
exchange.
o Call EASI-Line for automated
service 24 hours a day using
your touch-tone phone at
1-800-338-8080.

o Call your financial
representative or Signature
Services to request an
exchange.

By wire

[Clip Art] o Deliver your completed o Instruct your bank to wire
application to your financial the amount of your investment
representative, or mail it to to:
Signature Services. First Signature Bank & Trust
Account # 900000260
o Obtain your account number by Routing # 211475000
calling your financial
representative or Signature Specify the fund name, your
Services. share class, your account
number and the name(s) in which
o Instruct your bank to wire the account is registered. Your
the amount of your investment bank may charge a fee to wire
to: funds.
First Signature Bank & Trust
Account # 900000260
Routing # 211475000

Specify the fund name, your
choice of share class, the new
account number and the name(s)
in which the account is
registered. Your bank may
charge a fee to wire funds.

By Internet

[Clip Art] See "By exchange" and "By o Verify that your bank or
wire." credit union is a member of
the Automated Clearing House
(ACH) system.

o Complete the "Bank
Information" section on your
account application.

o Log on to www.jhfunds.com to
initiate purchases using your
authorized bank account.

By phone

[Clip Art] See "By exchange" and "By o Verify that your bank or
wire." credit union is a member of
the Automated Clearing House
(ACH) system.

o Complete the "Bank
Information" section on your
account application.

o Call EASI-Line for automated
service 24 hours a day using
your touch-tone phone at
1-800-338-8080.

o Call your financial
representative or Signature
Services between 8 A.M. and 4
P.M. Eastern Time on most
business days.

- ------------------------------------------
Address:

John Hancock Signature Services, Inc.
1 John Hancock Way, Suite 1000
Boston, MA 02217-1000

Phone Number: 1-800-225-5291

Or contact your financial representative
for instructions and assistance.
- ------------------------------------------

To open or add to an account using the Monthly Automatic Accumulation Program,
see "Additional investor services."

YOUR ACCOUNT 9

- --------------------------------------------------------------------------------
Selling shares
- --------------------------------------------------------------------------------
Designed for To sell some or all of your shares

By letter

[Clip Art] o Accounts of any type. o Write a letter of instruction
or complete a stock power
o Sales of any amount. indicating the fund name,
your share class, your
account number, the name(s)
in which the account is
registered and the dollar
value or number of shares you
wish to sell.

o Include all signatures and
any additional documents that
may be required (see next
page).

o Mail the materials to
Signature Services.

o A check will be mailed to the
name(s) and address in which
the account is registered, or
otherwise according to your
letter of instruction.

By Internet

[Clip Art] o Most accounts. o Log on to www.jhfunds.com to
initiate redemptions from
o Sales of up to $100,000. your funds.

By phone

[Clip Art] o Most accounts. o Call EASI-Line for automated
service 24 hours a day using
o Sales of up to $100,000. your touch-tone phone at
1-800-338-8080.

o Call your financial
representative or Signature
Services between 8 A.M. and 4
P.M. Eastern Time on most
business days.

By wire or electronic funds transfer (EFT)

[Clip Art] o Requests by letter to sell o To verify that the Internet
any amount. or telephone redemption
privilege is in place on an
o Requests by Internet or phone account, or to request the
to sell up to $100,000. form to add it to an existing
account, call Signature
Services.

o Amounts of $1,000 or more
will be wired on the next
business day. A $4 fee will
be deducted from your
account.

o Amounts of less than $1,000
may be sent by EFT or by
check. Funds from EFT
transactions are generally
available by the second
business day. Your bank may
charge a fee for this
service.

By exchange

[Clip Art] o Accounts of any type. o Obtain a current prospectus
for the fund into which you
o Sales of any amount. are exchanging by Internet or
by calling your financial
representative or Signature
Services.

o Log on to www.jhfunds.com to
process exchanges between
your funds.

o Call EASI-Line for automated
service 24 hours a day using
your touch-tone phone at
1-800-338-8080.

o Call your financial
representative or Signature
Services to request an
exchange.

To sell shares through a systematic withdrawal plan, see "Additional investor
services."

10 YOUR ACCOUNT

Selling shares in writing In certain circumstances, you will need to make your
request to sell shares in writing. You may need to include additional items with
your request, unless they were previously provided to Signature Services and are
still accurate. These items are shown in the table below. You may also need to
include a signature guarantee, which protects you against fraudulent orders. You
will need a signature guarantee if:

o your address of record has changed within the past 30 days

o you are selling more than $100,000 worth of shares

o you are requesting payment other than by a check mailed to the address of
record and payable to the registered owner(s)

You will need to obtain your signature guarantee from a member of the Signature
Guarantee Medallion Program. Most brokers and securities dealers are
members of this program. A notary public CANNOT provide a signature guarantee.

- --------------------------------------------------------------------------------
Seller Requirements for written requests
- --------------------------------------------------------------------------------
[Clip Art]

Owners of individual, joint or o Letter of instruction.
UGMA/UTMA accounts (custodial
accounts for minors). o On the letter, the signatures and
titles of all persons authorized to
sign for the account, exactly as
the account is registered.

o Signature guarantee if applicable
(see above).

Owners of corporate, sole o Letter of instruction.
proprietorship, general partner or
association accounts. o Corporate business/organization
resolution, certified within the
past 12 months, or a John Hancock
Funds business/organization
certification form.

o On the letter and the resolution,
the signature of the person(s)
authorized to sign for the account.

o Signature guarantee if applicable
(see above).

Owners or trustees of trust accounts. o Letter of instruction.

o On the letter, the signature(s) of
the trustee(s).

o Copy of the trust document
certified within the past 12 months
or a John Hancock Funds trust
certification form.

o Signature guarantee if applicable
(see above).

Joint tenancy shareholders with o Letter of instruction signed by
rights of survivorship whose surviving tenant.
co-tenants are deceased.
o Copy of death certificate.

o Signature guarantee if applicable
(see above).

Executors of shareholder estates. o Letter of instruction signed by
executor.

o Copy of order appointing executor,
certified within the past 12
months.

o Signature guarantee if applicable
(see above).

Administrators, conservators, o Call 1-800-225-5291 for
guardians and other sellers or instructions.
account types not listed above.

- ------------------------------------------
Address:

John Hancock Signature Services, Inc.
1 John Hancock Way, Suite 1000
Boston, MA 02217-1000

Phone Number: 1-800-225-5291

Or contact your financial representative
for instructions and assistance.
- ------------------------------------------

YOUR ACCOUNT 11

- --------------------------------------------------------------------------------
TRANSACTION POLICIES

Valuation of shares The net asset value (NAV) per share for each class of the
fund is determined each business day at the close of regular trading on the New
York Stock Exchange (typically 4 P.M. Eastern Time). The fund uses market prices
in valuing portfolio securities, but may use fair-value estimates if reliable
market prices are unavailable. The fund may also value securities at fair value
if the value of these securities has been materially affected by events
occurring after the close of a foreign market. Foreign stock or other portfolio
securities held by the fund may trade on U.S. holidays and weekends, even though
the fund's shares will not be priced on those days. This may change the fund's
NAV on days when you cannot buy or sell shares.

Buy and sell prices When you buy shares, you pay the NAV plus any applicable
sales charges, as described earlier. When you sell shares, you receive the NAV
minus any applicable deferred sales charges.

Execution of requests The fund is open on those days when the New York Stock
Exchange is open, typically Monday through Friday. Buy and sell requests are
executed at the next NAV to be calculated after Signature Services receives your
request in good order.

At times of peak activity, it may be difficult to place requests by phone.
During these times, consider using EASI-Line, accessing www.jhfunds.com, or
sending your request in writing.

In unusual circumstances, the fund may temporarily suspend the processing of
sell requests, or may postpone payment of proceeds for up to three business days
or longer, as allowed by federal securities laws.

Telephone transactions For your protection, telephone requests may be recorded
in order to verify their accuracy. Also for your protection, telephone
redemption transactions are not permitted on accounts whose names or addresses
have changed within the past 30 days. Proceeds from telephone transactions can
only be mailed to the address of record.

Exchanges You may exchange shares of one John Hancock fund for shares of the
same class of any other, generally without paying any additional sales charges.
The registration for both accounts involved must be identical. Class B and Class
C shares will continue to age from the original date and will retain the same
CDSC rate. However, if the new fund's CDSC rate is higher, then the rate will
increase. A CDSC rate that has increased will drop again with a future exchange
into a fund with a lower rate.

To protect the interests of other investors in the fund, the fund may cancel the
exchange privileges of any parties who, in the opinion of the fund, are using
market timing strategies or making more than seven exchanges per owner or
controlling party per calendar year. The fund may also refuse any exchange
order. The fund may change or cancel its exchange policies at any time, upon 60
days' notice to its shareholders.

Certificated shares The fund does not issue share certificates. Shares are
electronically recorded.

Sales in advance of purchase payments When you place a request to sell shares
for which the purchase money has not yet been collected, the request will be
executed in a timely fashion, but the fund will not release the proceeds to you
until your purchase payment clears. This may take up to ten business days after
the purchase.

- --------------------------------------------------------------------------------
DIVIDENDS AND ACCOUNT POLICIES

Account statements In general, you will receive account statements as follows:

o after every transaction (except a dividend reinvestment) that affects your
account balance

o after any changes of name or address of the registered owner(s)

o in all other circumstances, every quarter

Every year you should also receive, if applicable, a Form 1099 tax information
statement, mailed by January 31.

Dividends The fund generally distributes most or all of its net earnings in the
form of dividends. The fund declares and pays any income dividends annually.
Capital gains, if any, are typically distributed annually.

Dividend reinvestments Most investors have their dividends reinvested in
additional shares of the same fund and class. If you choose this option, or if
you do not indicate any choice, your dividends will be reinvested on the
dividend record date. Alternatively, you can choose to have a check for your
dividends and capital gains in the amount of more than $10 mailed to you.
However, if the check is not deliverable or the combined dividend and capital
gains amount is $10 or less, your proceeds will be reinvested. If five or more
of your dividend or capital gains checks remain uncashed after 180 days, all
subsequent dividends and capital gains will be reinvested.

12 YOUR ACCOUNT

Taxability of dividends Dividends you receive from a fund, whether reinvested or
taken as cash, are generally considered taxable. Dividends from the fund's
long-term capital gains are taxable as capital gains; dividends from the fund's
income and short-term capital gains are generally taxable as ordinary income.
Whether gains are short-term or long-term depends on the fund's holding period.
Some dividends paid in January may be taxable as if they had been paid the
previous December.

The Form 1099 that is mailed to you every January details your dividends and
their federal tax category, although you should verify your tax liability with
your tax professional.

Taxability of transactions Any time you sell or exchange shares, it is
considered a taxable event for you. Depending on the purchase price and the sale
price of the shares you sell or exchange, you may have a gain or a loss on the
transaction. You are responsible for any tax liabilities generated by your
transactions.

Small accounts (non-retirement only) If you draw down a non-retirement account
so that its total value is less than $1,000, you may be asked to purchase more
shares within 30 days. If you do not take action, your fund may close out your
account and mail you the proceeds. Alternatively, Signature Services may charge
you $10 a year to maintain your account. You will not be charged a CDSC if your
account is closed for this reason, and your account will not be closed if its
drop in value is due to fund performance or the effects of sales charges.

- --------------------------------------------------------------------------------
ADDITIONAL INVESTOR SERVICES

Monthly Automatic Accumulation Program (MAAP) MAAP lets you set up regular
investments from your paycheck or bank account to the John Hancock fund(s) of
your choice. You determine the frequency and amount of your investments, and you
can terminate your program at any time. To establish:

o Complete the appropriate parts of your account application.

o If you are using MAAP to open an account, make out a check ($25 minimum)
for your first investment amount payable to "John Hancock Signature
Services, Inc." Deliver your check and application to your financial
representative or Signature Services.

Systematic withdrawal plan This plan may be used for routine bill payments or
periodic withdrawals from your account. To establish:

o Make sure you have at least $5,000 worth of shares in your account.

o Make sure you are not planning to invest more money in this account
(buying shares during a period when you are also selling shares of the
same fund is not advantageous to you, because of sales charges).

o Specify the payee(s). The payee may be yourself or any other party, and
there is no limit to the number of payees you may have, as long as they
are all on the same payment schedule.

o Determine the schedule: monthly, quarterly, semi-annually, annually or in
certain selected months.

o Fill out the relevant part of the account application. To add a systematic
withdrawal plan to an existing account, contact your financial
representative or Signature Services.

Retirement plans John Hancock Funds offers a range of retirement plans,
including traditional, Roth and Education IRAs, SIMPLE plans, SEPs and other
pension and profit-sharing plans. Using these plans, you can invest in any John
Hancock fund (except tax-free income funds) with a low minimum investment of
$250 or, for some group plans, no minimum investment at all. To find out more,
call Signature Services at 1-800-225-5291.

YOUR ACCOUNT 13

Fund details

- --------------------------------------------------------------------------------
BUSINESS STRUCTURE

The diagram below shows the basic business structure used by the fund. The
fund's board of trustees oversees the fund's business activities and retains the
services of the various firms that carry out the fund's operations.

The trustees have the power to change the fund's investment goal without
shareholder approval.

The management firm The fund is managed by John Hancock Advisers, LLC. Founded
in 1968, John Hancock Advisers is a wholly owned subsidiary of John Hancock
Financial Services, Inc. and manages approximately $30 billion in assets.

The subadviser Yeager, Wood & Marshall, Inc. has been providing investment
advisory services since 1968 and is controlled by Mr. George M. Yeager,
President. The subadviser provides investment advisory services to individual
and institutional investors with total assets under management in excess of $345
million as of September 30, 2001.

Management fee The fund pays the investment adviser a management fee of 0.75% of
the fund's average daily net assets.

-----------------------
Shareholders
-----------------------

Distribution and
shareholder services

---------------------------------------------------
Financial services firms and
their representatives

Advise current and prospective share-
holders on their fund investments, often
in the context of an overall financial plan.
---------------------------------------------------

---------------------------------------------------
Principal distributor

John Hancock Funds, LLC

Markets the fund and distributes shares
through selling brokers, financial planners
and other financial representatives.
---------------------------------------------------

---------------------------------------------------
Transfer agent

John Hancock Signature Services, Inc.

Handles shareholder services, including record-
keeping and statements, distribution of dividends
and processing of buy and sell requests.
---------------------------------------------------

Asset
Management

---------------------------------------------------
Subadviser

Yeager, Wood & Marshall, Inc.
630 Fifth Avenue
New York, NY 10111

Provides portfolio management to
the Fund.
---------------------------------------------------

---------------------------------------------------
Investment adviser

John Hancock Advisers, LLC
101 Huntington Avenue
Boston, MA 02199-7603

Manages the fund's business and
investment activities.
---------------------------------------------------

---------------------------------------------------
Custodian

The Bank of New York
One Wall Street
New York, NY 10286

Holds the fund's assets, settles all
portfolio trades and collects most of
the valuation data required for
calculating the fund's NAV.
---------------------------------------------------

---------------------------------------------------
Trustees

Oversee the fund's activities.
---------------------------------------------------

14 FUND DETAILS

- --------------------------------------------------------------------------------
MANAGEMENT BIOGRAPHIES

Below is a list of the portfolio managers for the John Hancock U.S. Global
Leaders Growth Fund. It is a brief summary of their business careers over the
past five years.

George M. Yeager
- ------------------------------------

George P. Fraise
- ------------------------------------

FINANCIAL HIGHLIGHTS

Year Ended June 30,
Six Month ----------------------------------------------
Period
Ended
December 31, 2001 2000 1999 1998 1997
---------------------------------------------------------------

Net asset value, beginning of period $26.37 $25.65 $22.35 $16.29 $12.08
Income from investment operations: ------ ------ ------ ------ ------
- ----------------------------------
Net investment loss (0.14) (0.07) (0.13) (0.07) (0.04)
Net realized and unrealized gain (loss)
on investments (1.25) 0.79 3.43 6.13 4.39
------ ---- ---- ---- ----
Total from investment operations (1.39) 0.72 3.30 6.06 4.35
------ ---- ---- ---- ----
Less distributions:
- ------------------
From net realized gain - - - - (0.14)
----- ----- ----- ----- ------
Net asset value, end of year $24.98 $26.37 $25.65 $22.35 $16.29
====== ====== ====== ====== ======
Total return (5.27%) 2.81% 14.77% 37.20% 36.29%
Ratios/supplemental data:
- -------------------------
Net assets, end of year (millions) $81.2 $86.9 $129.0 $89.4 $26.9
Ratio of expenses to average net assets:
- ----------------------------------------
Before fees waived and expenses absorbed 1.38% 1.31% 1.31% 1.43% 1.87%
After fees waived and expenses absorbed 1.38% 1.31% 1.31% 1.42% 1.48%
Ratio of net investment loss to average net assets:
- ---------------------------------------------------
Before fees waived and expenses absorbed (0.54)% (0.23)% (0.66)% (0.67)% (0.79)%
After fees waived and expenses absorbed (0.54)% (0.23)% (0.66)% (0.66)% (0.39)%
Portfolio turnover rate 3.12% 24.91% 14.27% 4.02% 21.49%

FUND DETAILS 15

For more information
- --------------------------------------------------------------------------------

Two documents are available that offer further information on the John Hancock
U.S. Global Leaders Growth Fund:

Annual/Semiannual Report to Shareholders

Includes financial statements, a discussion of the market conditions and
investment strategies that significantly affected performance, as well as the
auditors' report (in annual report only).

Statement of Additional Information (SAI)

The SAI contains more detailed information on all aspects of the fund. The
current annual report is included in the SAI.

A current SAI has been filed with the Securities and Exchange Commission and is
incorporated by reference into (is legally a part of) this prospectus.

To request a free copy of the current annual/semiannual report or the SAI,
please contact John Hancock:

By mail:
John Hancock Signature Services, Inc.
1 John Hancock Way, Suite 1000
Boston, MA 02217-1000

By phone: 1-800-225-5291

By EASI-Line: 1-800-338-8080

By TDD: 1-800-544-6713

On the Internet: www.jhfunds.com

Or you may view or obtain these documents from the SEC:

In person: at the SEC's Public Reference Room in Washington, DC. For access to
the Reference Room call 1-202-942-8090

By mail: Public Reference Section
Securities and Exchange Commission
Washington, DC 20549-0102
(duplicating fee required)

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JOHN HANCOCK U.S. GLOBAL LEADERS GROWTH FUND

STATEMENT OF ADDITIONAL INFORMATION

April 12, 2002

This Statement of Additional Information is not a Prospectus. It should be read
in conjunction with the related Prospectus (also dated April 12, 2002) which
covers Class A shares of beneficial interest of John Hancock U.S. Global Leaders
Growth Fund to be issued in exchange for shares of beneficial interest of U.S.
Global Leaders Growth Fund, a series of Professionally Managed Portfolios.
Please retain this Statement of Additional Information for further reference.

The Prospectus is available to you free of charge (please call 1-800-282-2340,
or write to U.S. Global Leaders Growth Fund, c/o Orbitex Data Services, Inc.,
P.O. Box 542007, Omaha, NE 68154-1952).

TABLE OF CONTENTS

EXHIBITS.......................................................................1

INTRODUCTION...................................................................1

INCORPORATION BY REFERENCE.....................................................1

ADDITIONAL INFORMATION ABOUT U.S. GLOBAL LEADERS GROWTH FUND...................2
Fund History................................................................2
Description Of The Fund And Its Investment Risks............................2
Management Of The Fund......................................................2
Control Persons And Principal Holders Of Securities.........................3
Investment Advisory And Other Services......................................3
Brokerage Allocation And Other Practices....................................4
Captial Stock And Other Securities..........................................4
Purchase, Redemption And Pricing Of Shares..................................4
Taxation Of The Fund........................................................4
Underwriters................................................................4
Calculation Of Performance Data.............................................4
Financial Statements........................................................4

ADDITIONAL INFORMATION ABOUT JOHN HANCOCK U.S. GLOBAL LEADERS GROWTH FUND......4
Fund History................................................................4
Description Of The Fund And Its Investment Risks............................4
Management Of Pioneer High Yield Fund.......................................5
Control Persons And Principal Holders Of Securities.........................5
Investment Advisory And Other Services......................................5
Brokerage Allocation And Other Practices....................................5
Capital Stock And Other Securities..........................................5
Purchase, Redemption And Pricing Of Shares..................................5
Taxation Of The Fund........................................................5
Underwriters................................................................5
Calculation Of Performance Data.............................................5
Financial Statements........................................................6

EXHIBITS

The following documents are attached as exhibits to this Statement of
Additional Information:

Exhibit A - Preliminary Statement of Additional Information, dated
April 12, 2002, of John Hancock U.S. Global Leaders
Growth Fund (the "John Hancock Fund SAI")

Exhibit B - Annual Report, dated June 30, 2002, of U.S. Global Leaders
Growth Fund

Exhibit C - Semi-Annual Report, dated December 31, 2001, of U.S. Global
Leaders Growth Fund

Pro forma financial statements are not included since U.S. Global
Leaders Growth Fund is being combined with John Hancock U.S. Global
Leaders Growth Fund, which is newly created and does not have any
assets or liabilities.

INTRODUCTION

This Statement of Additional Information is intended to supplement the
information provided in a Proxy Statement and Prospectus dated April 12, 2002
(the "Proxy Statement and Prospectus") relating to the proposed reorganization
of U.S. Global Leaders Growth Fund, a series of Professionally Managed
Portfolios into John Hancock U.S. Global Leaders Growth Fund, a series of John
Hancock Capital Series. The Proxy Statement and Prospectus has been sent to the
shareholders of U.S. Global Leaders Growth Fund in connection with the
solicitation by the management of U.S. Global Leaders Growth Fund of proxies to
be voted at the Meeting of Shareholders of U.S. Global Leaders Growth Fund to be
held on May 8, 2002.

INCORPORATION BY REFERENCE

The following documents are incorporated by reference into this
Statement of Additional Information:

o Statement of Additional Information, dated October 29, 2001, of U.S.
Global Leaders Growth Fund (the "U.S. Global Leaders SAI") (file no.
33-12213), filed with the Securities and Exchange Commission on October
24, 2001 (accession number: 0001143798-01-500047)

o Annual Report, dated June 30, 2002, of U.S. Global Leaders Growth
Fund (file no. 33-12213), filed with the Securities and Exchange
Commission on September 5, 2001 (accession no. 0000909012-01-500351)

o Semi-Annual Report, dated December 31, 2001, of U.S. Global Leaders
Growth Fund (file no. 33-12213), filed with the Securities and Exchange
Commission on March 4, 2002 (accession number: 0000909012-02-000197)

o The John Hancock Fund SAI (file no. 002-29502), filed with the
Securities and Exchange Commission on February 27, 2002 (accession no.
0001010521-02-000114)

ADDITIONAL INFORMATION ABOUT
U.S. GLOBAL LEADERS GROWTH FUND

FUND HISTORY

For additional information about U.S. Global Leaders Growth Fund
generally and its history, see "The Trust" and "General Information" in the U.S.
Global Leaders SAI.

DESCRIPTION OF THE FUND AND ITS INVESTMENT RISKS

For additional information about U.S. Global Leaders Growth Fund's
investment objective, policies, risk and restriction, see "Investment Objective
and Policies" and "Investment Restrictions" in the U.S. Global Leaders SAI.

MANAGEMENT OF THE FUND

- ------------------------- -------------- ------------------ -------------------------------------- -------------------
Name, address and Date Position(s) Term of Office Principal Occupation During Past Other Trustee or
of Birth held with and Length of Five Years Directorships
Fund Time Served Held by Trustee
- ------------------------- -------------- ------------------ -------------------------------------- -------------------
Steven J. Paggioli* President [___________] Executive Vice President, Investment [___________]
915 Broadway, New York, and Trustee Company Administration, LLC ("ICA")
New York 10010 (mutual fund administrator and the
04/03/50 Fund's administrator); Vice
President, Advisors Series Trust;
Trustee, Managers Funds.
- ------------------------- -------------- ------------------ -------------------------------------- -------------------
Dorothy A. Berry Chairman and [___________] President, Talon Industries (venture [___________]
4455 E. Camelback Rd., Trustee capital and business consulting);
Suite 261-E, Phoenix, formerly Chief Operating Officer,
AZ 85018 Integrated Asset Management
08/12/43 (investment advisor and manager) and
formerly President, Value Line,
Inc., (investment advisory and
financial publishing firm).
- ------------------------- -------------- ------------------ -------------------------------------- -------------------
Wallace L. Cook Trustee [___________] Retired. Formerly Senior Vice [___________]
4455 E. Camelback Rd., President, Rockefeller Trust Co.
Suite 261-E, Phoenix, Financial Counselor, Rockefeller &
AZ 85018 Co.
09/10/39
- ------------------------- -------------- ------------------ -------------------------------------- -------------------
Carl A. Froebel Trustee [___________] Private Investor. Formerly Managing [___________]
4455 E. Camelback Rd., Director, Premier Solutions, Ltd.
Suite 261-E, Phoenix, Formerly President and Founder,
AZ 85018 National Investor Data Services,
05/23/38 Inc. (investment related computer
software)
- ------------------------- -------------- ------------------ -------------------------------------- -------------------
Rowley W.P. Redington Trustee [___________] President; Intertech (consumer [___________]
4455 E. Camelback Rd., electronics and computer service and
Suite 261-E, Phoenix, marketing); formerly Vice President,
AZ 85018 PRS of New Jersey, Inc. (management
06/01/44 consulting), and Chief Executive
Officer, Rowley Associates
(consultants)
- ------------------------- -------------- ------------------ -------------------------------------- -------------------

The following table sets forth the dollar range of shares of the Fund
beneficially owned by each Trustee:

-------------------------------------------- ------------------------------------------------------
Name of Trustee Dollar range of shares in the Fund beneficially owned
-------------------------------------------- ------------------------------------------------------

-------------------------------------------- ------------------------------------------------------
Wallace L. Cook None
-------------------------------------------- ------------------------------------------------------
Rowley W. P. Redington None
-------------------------------------------- ------------------------------------------------------
Carl A. Froebel $0 to $5,000
-------------------------------------------- ------------------------------------------------------
Dorothy A. Berry $10,000 to $50,000
-------------------------------------------- ------------------------------------------------------
Steven J. Paggioli* $10,000 to $50,000
-------------------------------------------- ------------------------------------------------------

* Indicates an "interested person" of the Trust as defined in the
Investment Company Act of 1940, as amended.

In granting approval of the existing Investment Advisory Agreement
between the Trust, on behalf of the Fund, and the Advisor, the Board of Trustees
of the Trust, including those trustees who are not "interested persons" as
defined under the Investment Company Act of 1940, as amended (the "Independent
Trustees"), found the terms of the Investment Advisory Agreement to be fair and
reasonable.

The Trustees, including the Independent Trustees, based this conclusion
on the following material factors: (a) the Advisor's performance was acceptable
on an absolute basis and compared with other investment companies of similar
investment objectives and size; (b) shareholder satisfaction with the Fund's
management was at an acceptable level; (c) the advisory and other fees paid by
the Fund to the Advisor were reasonable and consistent with advisory and other
fees paid by other investment companies of similar investment objectives and
size and the Investment Advisory Agreement provides for a reduction in advisory
fees as the Fund grows larger in size; (d) the Advisor's brokerage practices
were reasonably efficient and portfolio turnover was at an acceptable level and
reflected a sensitivity to shareholder tax issues; (e) the Advisor demonstrated
adherence to Code of Ethics and requirements regarding reporting; (f) the
Advisor had sufficiently qualified personnel and adequate internal controls to
manage the assets of the Fund and was capable to offer its services to the Fund;
and (g) the Advisor is of sufficient financial strength for purposes of managing
the Fund.

The Trustees, including the Independent Trustees, based this analysis
on a review of materials relating to the Fund's performance, operating expense
comparisons, the Advisor's financial capacity, staffing and succession
considerations, the timeliness, adequacy and quality of information requested by
the Trustees and the administrator to the Fund, regulatory issues, and brokerage
and soft dollar procedures.

For additional information about Professionally Managed Portfolios
Board of Trustees, and the officers and management personnel of U.S. Global
Leaders Growth Fund, see "Trustees and Executive Officers" in the U.S. Global
Leaders SAI.

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

For additional information about ownership of shares of U.S. Global
Leaders Growth Fund, see "General Information" in the U.S. Global Leaders SAI.

INVESTMENT ADVISORY AND OTHER SERVICES

For additional information about advisory and other services, see "The
Fund's Investment Advisor," "The Fund's Administrator," "The Fund's
Distributor," and "General Information" in the U.S. Global Leaders SAI.

BROKERAGE ALLOCATION AND OTHER PRACTICES

For additional information about U.S. Global Leaders Growth Fund's
brokerage allocation practices, see "Execution of Portfolio Transactions" in the
U.S. Global Leaders SAI.

CAPTIAL STOCK AND OTHER SECURITIES

For additional information about the voting rights and other
characteristics of U.S. Global Leaders Growth Fund's shares, see "General
Information" in the U.S. Global Leaders SAI.

PURCHASE, REDEMPTION AND PRICING OF SHARES

For additional information about share purchase, redemption and pricing
of U.S. Global Leaders Growth Fund shares, see "Additional Purchase and
Redemption Information" and "Determination of Share Price" in the U.S. Global
Leaders SAI.

TAXATION OF THE FUND

For additional information about tax matter, see "Distributions and Tax
Information" in the U.S. Global Leaders SAI.

UNDERWRITERS

For additional information, see "The Fund's Distributor" in the U.S.
Global Leaders SAI.

CALCULATION OF PERFORMANCE DATA

For additional information about the investment performance of U.S.
Global Leaders Growth Fund, see "Performance Information" in the U.S. Global
Leaders SAI.

FINANCIAL STATEMENTS

For additional information, see "Financial Statements" in the U.S.
Global Leaders SAI.

ADDITIONAL INFORMATION ABOUT
JOHN HANCOCK U.S. GLOBAL LEADERS GROWTH FUND

FUND HISTORY

For additional information about John Hancock U.S. Global Leaders
Growth Fund generally and its history, see "Organization of the Fund" in the
John Hancock Fund SAI.

DESCRIPTION OF THE FUND AND ITS INVESTMENT RISKS

For additional information about John Hancock U.S. Global Leaders
Growth Fund's investment objective, policies, risks and restrictions see
"Investment Objectives and Policies" and "Investment Restrictions" in the John
Hancock Fund SAI.

MANAGEMENT OF JOHN HANCOCK U.S. GLOBAL LEADERS GROWTH FUND

For additional information about John Hancock U.S. Global Leaders
Growth Fund's Board of Trustees, officers and management personnel, see "Those
Responsible for Management" in the John Hancock Fund SAI.

CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES

Not Applicable.

INVESTMENT ADVISORY AND OTHER SERVICES

For additional information, see "Investment Advisory and Other
Services," Transfer Agent Services," "Custody of Portfolio" and "Independent
Auditors" in the John Hancock Fund SAI.

BROKERAGE ALLOCATION AND OTHER PRACTICES

For additional information about John Hancock U.S. Global Leaders
Growth Fund's brokerage allocation practices, see "Brokerage Transactions" in
the John Hancock Fund SAI.

CAPITAL STOCK AND OTHER SECURITIES

For additional information about the voting rights and other
characteristics of shares of beneficial interest of John Hancock U.S. Global
Leaders Growth Fund, see "Description of the Fund's Shares" in the John Hancock
Fund SAI.

PURCHASE, REDEMPTION AND PRICING OF SHARES

For additional information about purchase, redemption and pricing, see
"Net Asset Value," "Initial Sales Charge on Class A Shares," "Deferred Sales
Charge on Class B and Class C Shares," "Special Redemptions," "Additional
Services and Programs" and "Purchase and Redemptions through Third Parties" in
the John Hancock Fund SAI.

TAXATION OF THE FUND

For additional information about tax matters, see "Tax Status" in the
John Hancock Fund SAI.

UNDERWRITERS

For additional information about John Hancock U.S. Global Leaders
Growth Fund's principal underwriter and distribution plans, see "Distribution
Contracts" and "Sales Compensation" in the John Hancock Fund SAI.

CALCULATION OF PERFORMANCE DATA

For additional information about the investment performance of John
Hancock U.S. Global Leaders Growth Fund, see "Calculation of Performance" in the
John Hancock Fund SAI.

FINANCIAL STATEMENTS

For additional information, see "Financial Statements" in the John
Hancock Fund SAI.

Subject to Completion: Dated April , 2002

Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor any
offers to buy be accepted prior to the time the registration statement becomes
effective. This statement of additional information is not a prospectus.

JOHN HANCOCK U.S. GLOBAL LEADERS GROWTH FUND

Class A, Class B, Class C and Class I Shares
Statement of Additional Information

May 13, 2002

This Statement of Additional Information provides information about John Hancock
U.S. Global Leaders Growth Fund (the "Fund") in addition to the information that
is contained in the Fund's current Prospectus and in the Fund's current
Prospectus for Class I shares (the "Prospectuses"). The Fund is a
non-diversified series of John Hancock Capital Series (the "Trust").

This Statement of Additional Information is not a prospectus. It should be read
in conjunction with the Prospectus, a copy of which can be obtained free of
charge by writing or telephoning:

John Hancock Signature Services, Inc.
1 John Hancock Way, Suite 1000
Boston, Massachusetts 02217-1000
1-800-225-5291

TABLE OF CONTENTS

Page

Organization of the Fund .................................................. 2
Investment Objective and Policies ......................................... 2
Investment Restrictions ................................................... 8
Those Responsible for Management .......................................... 10
Investment Advisory and Other Services .................................... 16
Distribution Contracts .................................................... 19
Sales Compensation ........................................................ 20
Net Asset Value ........................................................... 22
Initial Sales Charge on Class A Shares .................................... 22
Deferred Sales Charge on Class B and Class C Shares ....................... 25
Special Redemptions ....................................................... 29
Additional Services and Programs .......................................... 29
Purchase and Redemptions through Third Parties ............................ 31
Description of the Fund's Shares .......................................... 31
Tax Status ................................................................ 32
Calculation of Performance ................................................ 37
Brokerage Allocation ...................................................... 39
Transfer Agent Services ................................................... 41
Custody of Portfolio ...................................................... 41
Independent Auditors ...................................................... 41
Appendix A- Description of Investment Risk ................................ A-1
Appendix B-Description of Bond Ratings .................................... B-1

ORGANIZATION OF THE FUND

The Fund is a series of the Trust, an open-end investment management company
organized as a Massachusetts business trust under the laws of The Commonwealth
of Massachusetts. The fund is the successor to U.S. Global Leaders Growth Fund,
a series of Professionally Managed Portfolios, a Massachusetts business trust.
On May , 2002, the fund acquired all of the assets of U.S. Global Leaders Growth
Fund pursuant to an agreement and plan of reorganization (the "Reorganization")
in exchange for Class A shares of the fund and the assumption of certain
liabilities of U.S. Global Leaders Growth Fund.

John Hancock Advisers, LLC (prior to February 1, 2002, John Hancock Adviser,
Inc.) (the "Adviser") is the Fund's investment adviser. The Adviser is an
indirect, wholly-owned subsidiary of John Hancock Life Insurance Company
(formerly John Hancock Mutual Life Insurance Company) (the "Life Company"), a
Massachusetts life insurance company chartered in 1862, with national
headquarters at John Hancock Place, Boston, Massachusetts. The Life Company is
wholly owned by John Hancock Financial Services, Inc., a Delaware corporation
organized in February, 2000.

INVESTMENT OBJECTIVE AND POLICIES

The following information supplements the discussion of the Fund's investment
objective and policies discussed in the Prospectus. Appendix A contains further
information describing investment risks. The investment objective is
non-fundamental and may be changed by the Trustees without shareholder approval.
There is no assurance that the Fund will achieve its investment objective.

The Fund seeks long-term growth of capital through its investment in sustainable
growth companies with a global reach. The Fund invests primarily in common
stocks of United States companies that have substantial international activities
("U.S. Global Leaders"). Under normal market conditions, at least 80% of the
Fund's assets will be invested in stocks of companies the Adviser regards as
U.S. Global Leaders.

The Management Team considers U.S. Global Leaders companies typically to exhibit
these key sustainable growth characteristics: I) Hold leading market shares of
their relevant growth markets, and hence possess the pricing flexibility that
results in high profit margins and high investment returns. II) Supply
consumable products or services so that their revenue streams are recurring
rather than derived from infrequent or postponable sales of big-ticket items.
The Management Team believes that companies with these characteristics should
have relatively low business risk and relatively high sustainability of earnings
growth. The Management Team believes that leading multi-national companies
traded publicly in U.S. securities markets have a number of advantages that make
them attractive investments. U.S. capital markets are large and liquid.
Accounting practices are consistent and well regulated. Currency and political
risks are minimized, and the costs associated with investing abroad are reduced.

Companies that have leading positions in growing markets in the U.S. and other
developed countries and also derive a significant portion of their profits in
fast-growing emerging markets are relatively limited in number at this time.
Because of the difficulty and expense in building broad-based distribution in
newer global markets, it appears likely that the number of such companies will
not expand rapidly. Thus, the Management Team believes that the stocks of
multi-national companies that can sustain superior global earnings growth are
likely to be accorded premium relative valuations.

With respect to the Fund's policy of investing at least 80% of its Assets in
global leaders, "Assets" means net assets plus the amount of any borrowings for
investment purposes. Also, with respect to this 80% investment policy, the Fund
will notify shareholders at least 60 days prior to any change in this policy.

The Management Team's investment policy is to identify U.S. Global Leaders
companies with superior long-term earnings prospects and to continue to own them
as long as their management are fulfilling their mission. As long as the Adviser
believes that shares of such companies continue to enjoy favorable prospects for
capital growth and that they are not overvalued in the marketplace, such shares
are ordinarily retained.

Unlike mutual funds that are classified as "global" funds, the Fund does not
have a principal investment policy that calls for foreign investing. The Fund is
non-diversified. This means that with respect to 50% of its assets, it may make
larger investments in individual companies than a fund that is diversified.
However, with respect to the other 50% of its assets, the Fund may only invest
up to 5% of its assets in any individual security. The Fund anticipates that its
portfolio turnover rate will not normally exceed 25%. This means that the Fund
has the potential to be a tax efficient investment. This should result in the
realization and distribution to shareholders of lower capital gains, which would
be considered tax efficient. This anticipated lack of frequent trading can also
lead to lower transaction costs, which could help to improve the Fund's
performance.

Under normal market conditions, the Fund will stay fully invested in stocks.
However, in abnormal circumstances, such as situations where the Fund
experiences large cash inflows or anticipates unusually large redemptions, and
in abnormal market, economic, political, or other conditions, the Fund may
temporarily depart from its principal investment strategies by making short-term
investments in cash equivalents.

Risks of Multinational Companies: Because the Fund invests primarily in the
securities of companies with foreign business operations, the Fund may be
riskier than Funds that focus on companies with primarily U.S. operations.
Multinational companies may face certain political and economic risks, such as
foreign controls over currency exchange; restrictions on monetary repatriation;
possible seizure, nationalization or expropriation of assets; and political,
economic or social instability. These risks are greater for companies with
significant operations in developing countries.

Investment Companies. The Fund may invest in shares of other invest companies in
pursuit of its investment objective. This may include investment in money market
mutual funds in connection with the Fund's management of daily cash positions.
In addition to the advisory and operational fees the Fund bears directly in
connection with its own operation, the Fund and its shareholders will also bear
the pro rata portion of each other investment company's advisory and operational
expenses.

Foreign Investments. The Fund is permitted to invest up to 25% of its net assets
in foreign companies, although the level of such investment is not expected to
exceed 15% under normal circumstances. The Fund intends to invest only in large
capitalization, well established foreign issuers the securities of which are
traded in the U.S., and which present their financial data in accordance with
generally accepted accounting principles in the U.S.

American Depositary Receipts. The Fund may invest its assets in securities of
foreign issuers in the form of ADRs, which are receipts for the shares of a
foreign-based corporation. The Fund treats ADRs as interests in the underlying
securities for purposes of its investment policies. A purchaser of an
unsponsored ADR may not have unlimited voting rights and may not receive as much
information about the issuer of the underlying securities as with a sponsored
ADR.

Foreign Currency Transactions. The Fund may engage in foreign currency
transactions. Foreign currency transactions may be conducted on a spot (i.e.,
cash) basis at the spot rate for purchasing or selling currency prevailing in
the foreign exchange market.

The Fund may also enter into forward foreign currency exchange contracts to
hedge against fluctuations in currency exchange rates affecting a particular
transaction or portfolio position. Forward contracts are agreements to purchase
or sell a specified currency at a specified future date and price set at the
time of the contract. Transaction hedging is the purchase or sale of forward
foreign currency contracts with respect to specific receivables or payables of
the Fund accruing in connection with the purchase and sale of its portfolio
securities quoted or denominated in the same or related foreign currencies.
Portfolio hedging is the use of forward foreign currency contracts to offset
portfolio security positions denominated or quoted in the same or related
foreign currencies. The Fund may elect to hedge less than all of its foreign
portfolio positions as deemed appropriate by the Adviser. The Fund will not
engage in speculative forward foreign currency exchange transactions.

If the Fund purchases a forward contract, the Fund will segregate cash or liquid
securities in a separate account of the Fund in an amount equal to the value of
the Fund's total assets committed to the consummation of such forward contract.
The assets in the segregated account will be valued at market daily and if the
value of the securities in the separate account declines, additional cash or
securities will be placed in the account so that the value of the account will
be equal the amount of the Fund's commitment with respect to such contracts.

Hedging against a decline in the value of a currency does not eliminate
fluctuations in the prices of portfolio securities or prevent losses if the
prices of such securities decline. Such transactions also preclude the
opportunity for gain if the value of the hedged currency rises. Moreover, it may
not be possible for the Fund to hedge against a devaluation that is so generally
anticipated that the Fund is not able to contract to sell the currency at a
price above the devaluation level it anticipates.

Risks of Foreign Securities. Investments in foreign securities may involve a
greater degree of risk than those in domestic securities. There is generally
less publicly available information about foreign companies in the form of
reports and ratings similar to those that are published about issuers in the
United States. Also, foreign issuers are generally not subject to uniform
accounting, auditing and financial reporting requirements comparable to those
applicable to United States issuers.

Because foreign securities may be denominated in currencies other than the U.S.
dollar, changes in foreign currency exchange rates will affect the Fund's net
asset value, the value of dividends and interest earned, gains and losses
realized on the sale of securities, and any net investment income and gains that
the Fund distributes to shareholders. Securities transactions undertaken in some
foreign markets may not be settled promptly so that the Fund's investments on
foreign exchanges may be less liquid and subject to the risk of fluctuating
currency exchange rates pending settlement.

Foreign securities will be purchased in the best available market, whether
through over-the-counter markets or exchanges located in the countries where
principal offices of the issuers are located. Foreign securities markets are
generally not as developed or efficient as those in the United States. While
growing in volume, they usually have substantially less volume than the New York
Stock Exchange, and securities of some foreign issuers are less liquid and more
volatile than securities of comparable United States issuers. Fixed commissions
on foreign exchanges are generally higher than negotiated commissions on United
States exchanges, although the Fund will endeavor to achieve the most favorable
net results on its portfolio

transactions. There is generally less government supervision and regulation of
securities exchanges, brokers and listed issuers than in the United States.

With respect to certain foreign countries, there is the possibility of adverse
changes in investment or exchange control regulations, expropriation,
nationalization or confiscatory taxation limitations on the removal of funds or
other assets of the Fund, political or social instability, or diplomatic
developments which could affect United States investments in those countries.
Moreover, individual foreign economies may differ favorably or unfavorably from
the United States' economy in terms of growth of gross national product, rate of
inflation, capital reinvestment, resource self-sufficiency and balance of
payments position.

The dividends, in some cases capital gains and interest payable on certain of
the Fund's foreign portfolio securities, may be subject to foreign withholding
or other foreign taxes, thus reducing the net amount of income or gains
available for distribution to the Fund's shareholders.

Repurchase Agreements. In a repurchase agreement the Fund buys a security for a
relatively short period (usually not more than 7 days) subject to the obligation
to sell it back to the issuer at a fixed time and price plus accrued interest.
The Fund will enter into repurchase agreements only with member banks of the
Federal Reserve System and with "primary dealers" in U.S. Government securities.
The Adviser will continuously monitor the creditworthiness of the parties with
whom the Fund enters into repurchase agreements.

The Fund has established a procedure providing that the securities serving as
collateral for each repurchase agreement must be delivered to the Fund's
custodian either physically or in book-entry form and that the collateral must
be marked to market daily to ensure that each repurchase agreement is fully
collateralized at all times. In the event of bankruptcy or other default by a
seller of a repurchase agreement, the Fund could experience delays in
liquidating the underlying securities during the period in which the Fund seeks
to enforce its rights thereto, possible subnormal levels of income decline in
value of the underlying securities or lack of access to income during this
period and the expense of enforcing its rights.

Reverse Repurchase Agreements and Other Borrowings. The Fund may also enter into
reverse repurchase agreements which involve the sale of U.S. Government
securities held in its portfolio to a bank with an agreement that the Fund will
buy back the securities at a fixed future date at a fixed price plus an agreed
amount of "interest" which may be reflected in the repurchase price. Reverse
repurchase agreements are considered to be borrowings by the Fund. Reverse
repurchase agreements involve the risk that the market value of securities
purchased by the Fund with proceeds of the transaction may decline below the
repurchase price of the securities sold by the Fund which it is obligated to
repurchase. The Fund will also continue to be subject to the risk of a decline
in the market value of the securities sold under the agreements because it will
reacquire those securities upon effecting their repurchase. To minimize various
risks associated with reverse repurchase agreements, the Fund will establish and
maintain a separate account consisting of liquid securities, of any type or
maturity, in an amount at least equal to the repurchase prices of the securities
(plus any accrued interest thereon) under such agreements.

The Fund will not enter into reverse repurchase agreements and other borrowings
except from banks as a temporary measure for extraordinary emergency purposes in
amounts not to exceed 33 1/3% of the Fund's total assets (including the amount
borrowed) taken at market value. The Fund will not use leverage to attempt to
increase total return. The Fund will enter into reverse

repurchase agreements only with federally insured banks which are approved in
advance as being creditworthy by the Trustees. Under procedures established by
the Trustees, the Advisers will monitor the creditworthiness of the banks
involved.

Restricted Securities. The Fund may purchase securities that are not registered
("restricted securities") under the Securities Act of 1933 ("1933 Act"),
including commercial paper issued in reliance on Section 4(2) of the 1933 act
and securities offered and sold to "qualified institutional buyers" under Rule
144A under the 1933 Act. The Fund will not invest more than 15% of its net
assets in illiquid investments. If the Trustees determines, based upon a
continuing review of the trading markets for specific Section 4(2) paper or Rule
144A securities, that they are liquid, they will not be subject to the 15% limit
on illiquid investments. The Trustees have adopted guidelines and delegate to
the Advisers the daily function of determining the monitoring and liquidity of
restricted securities. The Trustees, however, will retain sufficient oversight
and be ultimately responsible for the determinations. The Trustees will
carefully monitor the Fund's investments in these securities, focusing on such
important factors, among others, as valuation, liquidity and availability of
information. This investment practice could have the effect of increasing the
level of illiquidity in the Fund if qualified institutional buyers become for a
time uninterested in purchasing these restricted securities.

Lending of Securities. The Fund may lend portfolio securities to brokers,
dealers, and financial institutions if the loan is collateralized by cash or
U.S. Government securities according to applicable regulatory requirements. The
Fund may reinvest any cash collateral in short-term securities and money market
funds. When the Fund lends portfolio securities, there is a risk that the
borrower may fail to return the securities involved in the transaction. As a
result, the Fund may incur a loss or, in the event of the borrower's bankruptcy,
the Fund may be delayed in or prevented from liquidating the collateral. It is a
fundamental policy of the Fund not to lend portfolio securities having a total
value exceeding 33 1/3% of its total assets.

Rights and Warrants. The Fund may purchase warrants and rights which are
securities permitting, but not obligating, their holder to purchase the
underlying securities at a predetermined price, subject to the Fund's Investment
Restrictions. Generally, warrants and stock purchase rights do not carry with
them the right to receive dividends or exercise voting rights with respect to
the underlying securities, and they do not represent any rights in the assets of
the issuer. As a result, an investment in warrants and rights may be considered
to entail greater investment risk than certain other types of investments. In
addition, the value of warrants and rights does not necessarily change with the
value of the underlying securities, and they cease to have value if they are not
exercised on or prior to their expiration date. Investment in warrants and
rights increases the potential profit or loss to be realized from the investment
of a given amount of the Fund's assets as compared with investing the same
amount in the underlying stock.

Short Sales. The Fund may engage in short sales "against the box". In a short
sale against the box, the Fund agrees to sell at a future date a security that
it either contemporaneously owns or has the right to acquire at no extra cost.
If the price of the security has declined at the time the Fund is required to
deliver the security, the Fund will benefit from the difference in the price. If
the price of the security has increased, the Fund will be required to pay the
difference.

Forward Commitment and When-Issued Securities. The Fund may purchase securities
on a when-issued or forward commitment basis. "When-issued" refers to securities
whose terms are available and for which a market exists, but which have not been
issued. The Fund will engage in when-issued transactions with respect to
securities purchased for its portfolio in order to obtain what is considered to
be an advantageous price and yield at the time of the transaction. For
when-issued transactions, no payment is made until delivery is due, often a
month or more after

the purchase. In a forward commitment transaction, the Fund contracts to
purchase securities for a fixed price at a future date beyond customary
settlement time.

When the Fund engages in forward commitment and when-issued transactions, it
relies on the seller to consummate the transaction. The failure of the issuer or
seller to consummate the transaction may result in the Fund's losing the
opportunity to obtain a price and yield considered to be advantageous. The
purchase of securities on a when-issued or forward commitment basis also
involves a risk of loss if the value of the security to be purchased declines
prior to the settlement date.

On the date the Fund enters into an agreement to purchase securities on a
when-issued or forward commitment basis, the Fund will segregate in a separate
account cash or liquid securities, of any type or maturity, equal in value to
the Fund's commitment. These assets will be valued daily at market, and
additional cash or securities will be segregated in a separate account to the
extent that the total value of the assets in the account declines below the
amount of the when-issued commitments. Alternatively, the Fund may enter into
offsetting contracts for the forward sale of other securities that it owns.

Short-Term Trading and Portfolio Turnover. Short-term trading means the purchase
and subsequent sale of a security after it has been held for a relatively brief
period of time. The Fund may engage in short-term trading in response to stock
market conditions, changes in interest rates or other economic trends and
developments, or to take advantage of yield disparities between various fixed
income securities in order to realize capital gains or improve income. Short
term trading may have the effect of increasing portfolio turnover rate. A high
rate of portfolio turnover (100% or greater) involves correspondingly greater
brokerage expenses. The Fund's portfolio turnover rate is set forth in the table
under the caption "Financial Highlights" in the Prospectus. The Fund may invest
in any of the following securities and instruments:

Certificates of Deposit, Bankers' Acceptances and Time Deposits. The Fund may
acquire certificates of deposit, bankers' acceptances and time deposits.
Certificates of deposit are negotiable certificates issued against funds
Deposited in a commercial bank for a definite period of time and earning a
Specified return. Bankers' acceptances are negotiable drafts or bills of
exchange, normally drawn by an importer or exporter to pay for specific
Merchandise, which are "accepted" by a bank, meaning in effect that the bank
unconditionally agrees to pay the face value of the instrument on maturity.
Certificates of deposit and bankers' acceptances acquired by the Fund will be
dollar-denominated obligations of domestic banks, savings and loan associations
or financial institutions which, at the time of purchase, have capital, surplus
and undivided profits in excess of $100 million (including assets of both
domestic and foreign branches), based on latest published reports, or less than
$100 million if the principal amount of such bank obligations are fully insured
by the U.S. Government. In addition to purchasing certificates of deposit and
bankers' acceptances, to the extent permitted under its investment objective and
policies stated above and in its prospectus, the Fund may make interest-bearing
time or other interest-bearing deposits in commercial or savings banks. Time
deposits are non-negotiable deposits maintained at a banking institution for a
specified period of time at a specified interest rate.

Commercial Paper and Short-Term Notes. The Fund may invest a portion of its
assets in commercial paper and short-term notes. Commercial paper consists of
unsecured promissory notes issued by corporations. Issues of commercial paper
and short-term notes will normally have maturates of less than nine months and
fixed rates of return, although such instruments may have maturates of up to one
year. Commercial paper and short-term notes will consist of issues rated at the
time of purchase "A-2" or higher by Standard & Poor's Ratings Group, "Prime-1"
or "Prime-2" by Moody's Investors Service, Inc., or similarly rated by another

nationally recognized statistical rating organization or, if unrated, will be
determined by the Adviser to be of comparable quality. These rating symbols are
described in the Appendix.

INVESTMENT RESTRICTIONS

Fundamental Investment Restrictions. The following investment restrictions will
not be changed without the approval of a majority of the Fund's outstanding
voting securities which, as used in the Prospectus and this Statement of
Additional Information, means the approval by the lesser of (1) the holders of
67% or more of the Fund's shares represented at a meeting if more than 50% of
the Fund's outstanding shares are present in person or by proxy at that meeting
or (2) more than 50% of the Fund's outstanding shares.

The Fund may not:

1. Issue senior securities, except as permitted by the Fund's fundamental
investment restrictions on borrowing, lending and investing in
commodities, and as otherwise permitted under the 1940 Act. For purposes
of this restriction, the issuance of shares of beneficial interest in
multiple classes or series, the deferral of trustees' fees, the purchase
or sale of options, futures contracts and options on futures contracts,
forward commitments, forward foreign exchange contracts and repurchase
agreements entered into in accordance with the Fund's investment policies
are not deemed to be senior securities.

2. Borrow money, except: (i) for temporary or short-term purposes or for the
clearance of transactions in amounts not to exceed 33 1/3% of the value of
the fund's total assets (including the amount borrowed) taken at market
value; (ii) in connection with the redemption of fund shares or to finance
failed settlements of portfolio trades without immediately liquidating
portfolio securities or other assets, (iii) in order to fulfill
commitments or plans to purchase additional securities pending the
anticipated sale of other portfolio securities or assets; (iv) in
connection with entering into reverse repurchase agreements and dollar
rolls, but only if after each such borrowing there is asset coverage of at
least 300% as defined in the 1940 Act; and (v) as otherwise permitted
under the 1940 Act. For purposes of this investment restriction, the
deferral of trustees' fees and transactions in short sales, futures
contracts, options on futures contracts, securities or indices and forward
commitment transactions shall not constitute borrowing.

3. Act as an underwriter, except to the extent that in connection with the
disposition of portfolio securities, the Fund may be deemed to be an
underwriter for purposes of the Securities Act of 1933.

4. Purchase, sell or invest in real estate, but subject to its other
investment policies and restrictions may invest in securities of companies
that deal in real estate or are engaged in the real estate business. These
companies include real estate investment trusts and securities secured by
real estate or interests in real estate. The fund may hold and sell real
estate acquired through default, liquidation or other distributions of an
interest in real estate as a result of the fund's ownership of securities.

5. Invest in commodities or commodity futures contracts, other than financial
derivative contracts. Financial derivatives include forward currency
contracts; financial futures contracts and options on financial futures
contracts; options and warrants on securities, currencies and financial
indices; swaps, caps, floors, collars and swaptions; and repurchase
agreements entered into in accordance with the fund's investment policies.

6. Make loans, except that the fund may (i) lend portfolio securities in
accordance with the

fund's investment policies up to 33 1/3% of the Fund's total assets taken
at market value, (ii) enter into repurchase agreements, and (iii) purchase
all or a portion of an issue of publicly distributed debt securities, bank
loan participation interests, bank certificates of deposit, bankers'
acceptances, debentures or other securities, whether or not the purchase
is made upon the original issuance of the securities.

7. Purchase the securities of issuers conducting their principal activity in
the same industry if, immediately after such purchase, the value of its
investments in such industry would exceed 25% of its total assets taken at
market value at the time of such investment. This limitation does not
apply to investments in obligations of the U.S. Government or any of its
agencies, instrumentalities or authorities.

Non-Fundamental Investment Restrictions. The following investment restrictions
are designated as non-fundamental and may be changed by the Trustees without
shareholder approval.

1. Purchase a security if, as a result, (i) more than 10% of the fund's total
assets would be invested in the securities of other investment companies,
(ii) the fund would hold more than 3% of the total outstanding voting
securities of any one investment company, or (iii) more than 5% of the
Fund's total assets would be invested in the securities of any one
investment company. These limitations do not apply to (a) the investment
of cash collateral, received by the fund in connection with lending of the
fund's portfolio securities, in the securities of open-end investment
companies or (b) the purchase of shares of any investment company in
connection with a merger, consolidation, reorganization or purchase of
substantially all of the assets of another investment company. Subject to
the above percentage limitations, the fund may, in connection with the
John Hancock Group of Funds Deferred Compensation Plan for Independent
Trustees/Directors, purchase securities of other investment companies
within the John Hancock Group of Funds.

2. Invest in the securities of an issuer for the purpose of exercising
control or management.

3. Purchase securities on margin, except that the Fund may obtain such
short-term credits as may be necessary for the clearance of securities
transactions.

4. Invest more than 15% of its net assets in securities which are illiquid.

If a percentage restriction on investment or utilization of assets as set forth
above is adhered to at the time an investment is made, a later change in
percentage resulting from changes in the value of the Fund's assets will not be
considered a violation of the restriction.

The Fund will invest only in countries on the Adviser's Approved Country
Listing. The Approved Country Listing is a list maintained by the Adviser's
investment department that outlines all countries, including the United States,
that have been approved for investment by Funds managed by the Adviser.

In addition, no Fund may invest either directly or indirectly in any Russian
equity. Only certain funds can invest in certain types of Russian debt. These
funds are: Active Bond, Income, Investors, High Income, Bond, High Yield Bond,
Strategic Income and VA Strategic Income. Each of these funds may invest only up
to 5% of total assets in: (1) Sovereign Russian Debt and Municipal Fixed Income
Securities; (2) that are NOT ruble-denominated; (3) that are held physically
outside of Russia; and (4) have Euroclear settlement.

THOSE RESPONSIBLE FOR MANAGEMENT

The business of the Fund is managed by the Trustees, who elect officers who are
responsible for the day-to-day operations of the Fund and who execute policies
formulated by the Trustees. Several of the officers and Trustees of the Fund are
also officers and Directors of the Adviser or officers and Directors of the
Fund's principal distributor, John Hancock Funds, LLC (prior to February 1,
2002, John Hancock Funds, Inc.) ("John Hancock Funds").

- ---------------------------------------------------------------------------------------------------------------------
Number of
John Hancock
Position(s) Trustee/ Principal Occupation(s) and other Funds
Name, Address (1) Held with Officer Directorships Overseen by
And Age Fund since(2) During Past 5 Years Trustee
- ---------------------------------------------------------------------------------------------------------------------

Independent Trustees

- ---------------------------------------------------------------------------------------------------------------------
Dennis S. Aronowitz Trustee 2002 Professor of Law, Emeritus, Boston 30
Born: 1931 University School of Law (as of 1996);
Director, Brookline Bancorp.

- ---------------------------------------------------------------------------------------------------------------------
Richard P. Chapman, Jr. Trustee 2002 Chairman, President and Chief Executive 30
Born: 1935 Officer, Brookline Bancorp. (lending)
(since 1972); Trustee, Northeastern
University (education); Chairman and
Director, Lumber Insurance Co. (insurance)
(until 2000); Chairman and Director,
Northeast Retirement Services, Inc.
(retirement administration) (since 1998).

- ---------------------------------------------------------------------------------------------------------------------
William J. Cosgrove Trustee 2002 Vice President, Senior Banker and Senior 30
Born: 1933 Credit Officer, Citibank, N.A. (retired
1991); Executive Vice President, Citadel
Group Representatives, Inc.; Director,
Hudson City Bancorp; Trustee, Scholarship
Fund for Inner City Children (since 1986).

- ---------------------------------------------------------------------------------------------------------------------
Richard A. Farrell Trustee 2002 President, Farrell, Healer & Co., Inc., 30
Born: 1932 (venture capital management firm)(since
1980) and General Partner of the Venture
Capital Fund of NE (since 1980); Prior to
1980, headed the venture capital group at
Bank of Boston Corporation.

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

(1) Business address for independent and interested Trustees and officers is 101
Huntington Avenue, Boston, Massachusetts 02119.
(2) Each Trustee serves until resignation, retirement age or until her or his
successor is elected.
(3) Interested Trustee: holds positions with the Fund's investment adviser,
underwriter, and or certain other affiliates.

- -------------------------------------------------------------------------------------------------------------------------------
Number of John
Position(s) Trustee/ Principal Occupation(s) and other Hancock Funds
Name, Address (1) Held with Officer Directorships Overseen by
And Age Fund since(2) During Past 5 Years Trustee
- -------------------------------------------------------------------------------------------------------------------------------

Gail D. Fosler Trustee 2002 Senior Vice President and Chief Economist, The 30
Born: 1947 Conference Board (non-profit economic and
business research)(since 1989); Director,
Unisys Corp. (since 1993); Director, H.B.
Fuller Company (since 1992) and DBS Holdings
(Singapore) (banking and financial
services)(since 1999); Director, National
Bureau of Economic Research (academic)(since
1989); Director, Baxter International (medical
health care) (since 2001).

- -------------------------------------------------------------------------------------------------------------------------------
William F. Glavin Trustee 2002 President Emeritus, Babson College (as of 1998); 30
Born: 1932 Vice Chairman, Xerox Corporation (until 1989);
Director, Reebok, Inc. (since 1994) and Inco Ltd.

- -------------------------------------------------------------------------------------------------------------------------------
John A. Moore Trustee 2002 President and Chief Executive Officer, 36
Born: 1939 Institute for Evaluating Health Risks,
(nonprofit institution) (until 2001); Senior
Scientist, Sciences International (health
research)(since 1998); Principal, Hollyhouse
(consulting)(since 2000); Director,
CIIT(nonprofit research) (since 2002).

- -------------------------------------------------------------------------------------------------------------------------------
Patti McGill Peterson Trustee 2002 Executive Director, Council for International 36
Born: 1943 Exchange of Scholars (since 1998); Vice
President, Institute of International Education
(since 1998); Senior Fellow, Cornell Institute
of Public Affairs, Cornell University (until
1997); President Emerita of Wells College and
St. Lawrence University; Director, Niagara
Mohawk Power Corporation (electric utility).

- -------------------------------------------------------------------------------------------------------------------------------
John W. Pratt Trustee 2002 Professor of Business Administration Emeritus, 30
Born: 1931 Harvard University Graduate School of Business
Administration (as of 1998).
- -------------------------------------------------------------------------------------------------------------------------------

Interested Trustees
- -------------------------------------------------------------------------------------------------------------------------------
John M. DeCiccio (3) Trustee 2002 Executive Vice President and Chief Investment 66
Born: 1948 Officer, John Hancock Financial Services,
Inc.; Director, Executive Vice President and
Chief Investment Officer, John Hancock Life
Insurance Company; Chairman of the Committee
of Finance of John Hancock Life Insurance
Company; Director, John Hancock Subsidiaries,
LLC, Hancock Natural Resource Group,
Independence Investment LLC, Independence
Fixed Income LLC, John Hancock Advisers, LLC
(the "Adviser") and The Berkeley Financial
Group, LLC ("The Berkeley Group"), John
Hancock Funds, LLC ("John Hancock Funds"),
Massachusetts Business Development
Corporation; Director, John Hancock Insurance
Agency, Inc. ("Insurance Agency, Inc.") (until
1999) and John Hancock Signature Services,
Inc. ("Signature Services") (until 1997).

- -------------------------------------------------------------------------------------------------------------------------------
Maureen R. Ford (3) Trustee, 2002 Executive Vice President, John Hancock 66
Born: 1955 Chairman, Financial Services, Inc., John Hancock Life
President Insurance Company; Chairman, Director,
and Chief President and Chief Executive Officer, the
Executive Advisers and The Berkeley Group; Chairman,
Officer Director and Chief Executive Officer, John
Hancock Funds, Chairman, Director and
President, Insurance Agency, Inc.; Chairman,
Director and Chief Executive Officer,
Sovereign Asset Management Corporation
("SAMCorp."); Director, Independence
Investment LLC, Independence Fixed Income LLC
and Signature Services; Senior Vice President,
MassMutual Insurance Co. (until 1999); Senior
Vice President, Connecticut Mutual Insurance
Co. (until 1996).
- -------------------------------------------------------------------------------------------------------------------------------

Principal Officers who
are not Trustees
- ---------------------------------------------------------------------------------------------------------------------
William L. Braman Executive 2002 Executive Vice President and Chief
Born: 1953 Vice Investment Officer, the Adviser and each
President of the John Hancock funds; Director,
and Chief SAMCorp., Executive Vice President and
Investment Chief Investment Officer, Baring Asset
Officer Management, London U.K. (until 2000).

- ---------------------------------------------------------------------------------------------------------------------
Richard A. Brown Senior Vice 2002 Senior Vice President, Chief Financial
Born: 1949 President Officer and Treasurer, the Adviser, John
and Chief Hancock Funds, and The Berkeley Group;
Financial Second Vice President and Senior Associate
Officer Controller, Corporate Tax Department, John
Hancock Financial Services, Inc. (until
2001).

- ---------------------------------------------------------------------------------------------------------------------
Thomas H. Connors Vice 2002 Vice President and Compliance Officer, the
Born: 1959 President Adviser and each of the John Hancock
and funds; Vice President, John Hancock Funds.
Compliance
Officer

- ---------------------------------------------------------------------------------------------------------------------
William H. King Vice 2002 Vice President and Assistant Treasurer,
Born: 1952 President the Adviser; Vice President and Treasurer
and of each of the John Hancock funds;
Treasurer Assistant Treasurer of each of the John
Hancock funds (until 2001).

- ---------------------------------------------------------------------------------------------------------------------
Susan S. Newton Senior Vice 2002 Senior Vice President, Secretary and Chief
Born: 1950 President, Legal Officer, SAMCorp., the Adviser and
Secretary each of the John Hancock funds, John
and Chief Hancock Funds and The Berkeley Group; Vice
Legal Officer President, Signature Services (until
2000), Director, Senior Vice President and
Secretary, NM Capital.
- ---------------------------------------------------------------------------------------------------------------------

The Fund's Board of Trustees currently has five standing Committees: the Audit
Committee, the Administration Committee, the Contracts/Operations Committee, the
Investment Performance Committee and the Coordinating Committee. Each Committee
is comprised of Independent Trustees who are not "interested persons". The Audit
Committee members are Messrs. Moore, Farrell and Ms. Fosler. The Audit Committee
recommends to the full board auditors for the Fund, monitors and oversees the
audits of the Fund, communicates with both independent auditors and internal
auditors on a regular basis and provides a forum for the auditors to report and
discuss any matters they deem appropriate at any time. The Audit Committee held
four meetings during the fiscal year ended December 31, 2001.

The Administration Committee's members are all of the Independent Trustees of
the Fund. The Administration Committee reviews the activities of the other four
standing committees and makes the final selection and nomination of candidates
to serve as Independent Trustees. The Administration Committee will consider
nominees recommended by shareholders to serve as Independent Trustees, provided
that shareholders submit recommendations in compliance with all of the pertinent
provisions of Rule 14a-8 under the Securities Exchange Act of 1934. The
Administration Committee also works with all Trustees on the selection and
election of officers of the Fund. The Administration Committee held four
meetings during the fiscal year ended December 31, 2001.

The Contracts/Operations Committee members are Messrs. Chapman, Cosgrove and
Pratt. The Contracts/Operations Committee oversees the initiation, operation,
and renewal of contracts between the Fund and other entities. These contracts
include advisory and subadvisory agreements, custodial and transfer agency
agreements and arrangements with other service providers. The
Contracts/Operations Committee held five meetings during the fiscal year ended
December 31, 2001.

The Investment Performance Committee consists of Messrs. Aronowitz, Glavin and
Ms. Peterson. The Investment Performance Committee monitors and analyzes the
performance of the Fund generally, consults with the adviser as necessary if the
Fund requires special attention, and reviews peer groups and other comparative
standards as necessary. The Investment Performance Committee held four meetings
during the fiscal year ended December 31, 2001.

The Coordinating Committee members are the chairpersons of the other four
standing committees. The Coordinating Committee assures consistency of action
among committees, reviews Trustee compensation, evaluates Trustee performance
and considers committee membership rotations as well as relevant corporate
governance issues.

The following table provides a dollar range indicating each Trustee's ownership
of equity securities of the Fund, as well as aggregate holdings of shares of
equity securities of all John Hancock Funds overseen by the Trustee, as of
December 31, 2001.

- -------------------------------------------------------------------------------------------------------------
Aggregate Dollar Range of holdings
Dollar Range of Fund Shares in John Hancock funds overseen by
Name of Trustee Owned by Trustee Trustee
- -------------------------------------------------------------------------------------------------------------

Independent Trustees
- -------------------------------------------------------------------------------------------------------------
Dennis S. Aronowitz $1-$10,000 $50,001-$100,000
- -------------------------------------------------------------------------------------------------------------
Richard P. Chapman, Jr. $1-$10,000 Over $100,000
- -------------------------------------------------------------------------------------------------------------
William J. Cosgrove $1-$10,000 Over $100,000
- -------------------------------------------------------------------------------------------------------------
Richard A. Farrell $1-$10,000 Over $100,000
- -------------------------------------------------------------------------------------------------------------
Gail D. Fosler $1-$10,000 $10,001-$50,000
- -------------------------------------------------------------------------------------------------------------
William F. Glavin None $10,001-$50,000
- -------------------------------------------------------------------------------------------------------------
Dr. John A. Moore $10,001-$50,000 Over $100,000
- -------------------------------------------------------------------------------------------------------------
Patti McGill Peterson $10,001-$50,000 Over $100,000
- -------------------------------------------------------------------------------------------------------------
John W. Pratt $10,000-$50,000 Over $100,000

- -------------------------------------------------------------------------------------------------------------
Interested Trustees
- -------------------------------------------------------------------------------------------------------------
John M. DeCiccio $50,000-$100,000 Over $100,000
- -------------------------------------------------------------------------------------------------------------
Maureen R. Ford $1-$10,000 Over $100,000
- -------------------------------------------------------------------------------------------------------------

The following table provides information regarding the compensation paid by the
Fund and the other investment companies in the John Hancock Fund Complex to the
Independent Trustees for their services. Mr. DeCiccio and Ms. Ford, each a
non-Independent Trustee, and each of the officers of the Fund who are interested
persons of the Adviser, are compensated by the Adviser and/or affiliates and
receive no compensation from the Fund for their services.

The following table provides information regarding the compensation paid by the
Fund and the other investment companies in the John Hancock Fund Complex to the
Independent Trustees for their services. Ms. Ford and Mr. DeCicco, each a
non-Independent Trustee, and each of the officers of the Fund are interested
persons of the Adviser, and/or affiliates are compensated by the Adviser and
receive no compensation from the Fund for their services.

Aggregate Total Compensation From the
Compensation from Fund and John Hancock Fund
Independent Trustees the Fund (1) Complex to Trustees (2)
- -------------------- ------------ -----------------------
Dennis J. Aronowitz $ 25 $ 75,000
Richard P. Chapman* 25 78,100
William J. Cosgrove* 25 72,000
Richard A. Farrell 25 72,000
Gail D. Fosler 25 75,000
William F. Glavin* 25 72,000
Dr. John A. Moore* 25 75,100
Patti McGill Peterson 25 72,000
John Pratt 25 72,000
---- --------
Total $225 $663,200

(1) Compensation is estimated for the fiscal period ended December 31, 2002.

(2) Total compensation paid by the John Hancock Funds Complex to the Independent
Trustees is as of December 31, 2001. As of this date, there were sixty-nine
funds in the John Hancock Fund Complex with each of these Independent Trustees
serving on thirty-one funds.

*As of December 31, 2001, the value of the aggregate accrued deferred
compensation amount from all funds in the John Hancock Funds Complex for Mr.
Chapman was $71,309, Mr. Cosgrove was $207,842, Mr. Glavin was $280,472 and for
Dr. Moore was $238,982 under the John Hancock Group of Funds Deferred
Compensation Plan for Independent Trustees (the "Plan").

All of the officers listed are officers or employees of the Adviser or
Affiliated Companies. Some of the Trustees and officers may also be officers or
Trustees of one or more of the other funds for which the Adviser serves as
investment adviser.

INVESTMENT ADVISORY AND OTHER SERVICES

The Adviser, located at 101 Huntington Avenue, Boston, Massachusetts 02199-7603,
was organized in 1968 and has approximately $30 billion in assets under
management in its capacity as investment adviser to the Fund and other funds in
the John Hancock group of funds as well as retail and institutional privately
managed accounts. The Adviser is an affiliate of the Life Company, one of the
most recognized and respected financial institutions in the nation. With total
assets under management of more than $100 billion, the Life Company is one of
the ten largest life insurance companies in the United States, and carries a
high rating with Standard & Poor's and A. M. Best. Founded in 1862, the Life
Company has been serving clients for over 130 years.

The Sub-Adviser, Yeager, Wood & Marshall, Incorporated, is located at 630 Fifth
Avenue, New York, NY 10111. The Sub-Adviser has been providing investment
advisory services since 1968 and is controlled by Mr. George M. Yeager,
President. The Sub-Adviser provides investment advisory services to individual
and institutional investors with total assets under management in excess of $345
million as of September 30, 2001.

The Fund has entered into an investment management contract (the "Advisory
Agreement") with the Adviser which was approved in connection with the
Reorganization by Professionally Managed Portfolios as the sole initial
shareholder of the Fund. Pursuant to the Advisory Agreements, the Adviser, in
conjunction with the Sub-Advisor will: (a) furnish continuously an investment
program for the Fund and determine, subject to the overall supervision and
review of the Trustees, which investments should be purchased, held, sold or
exchanged, and (b) provide supervision over all aspects of the Fund's operations
except those which are delegated to a custodian, transfer agent or other agent.

The Adviser and the Fund have entered into a Sub-Advisory Agreement with the
Sub-Adviser under which the Sub-Adviser, subject to the review of the Trustees
and the overall supervision of the Adviser, is responsible for managing the
investment operations of the Fund and the composition of the Fund's portfolio
and furnishing the Fund with advise and recommendations with respect to
investments, investment policies and the purchase and sale of securities. The
Sub-Advisory Agreement was approved in connection with the Reorganization by
Professionally Managed Portfolios as the sole shareholder of the Fund.

The Fund bears all costs of its organization and operation, including but not
limited to expenses of preparing, printing and mailing all shareholders'
reports, notices, prospectuses, proxy statements and reports to regulatory
agencies; expenses relating to the issuance, registration and qualification of
shares; government fees; interest charges; expenses of furnishing to
shareholders their account statements; taxes; expenses of redeeming shares;
brokerage and other expenses connected with the execution of portfolio
securities transactions; expenses pursuant to the Fund's plan of distribution;
fees and expenses of custodians including those for keeping books and accounts,
maintaining a committed line of credit, and calculating the net asset value of
shares; fees and expenses of transfer agents and dividend disbursing agents;
legal, accounting, financial, management, tax and auditing fees and expenses of
the Fund (including an allocable portion of the cost of the Adviser's employees
rendering such services to the Fund); the compensation and expenses of Trustees
who are not otherwise affiliated with the Trust, the Adviser or any of their

affiliates; expenses of Trustees' and shareholders' meetings; trade association
memberships; insurance premiums; and any extraordinary expenses.

As compensation for its services under the Advisory Agreement, the Fund pays the
Adviser monthly a fee based on a stated 0.75 percentage of the average daily net
assets of the Fund.

From time to time, the Adviser may reduce its fee or make other arrangements to
limit the Fund's annual ordinary operating expenses to a specified percentage of
its average daily net assets. The Adviser retains the right to reimpose a fee
and recover any other payments to the extent that, at the end of any fiscal
year, the Fund's annual expenses fall below this limit.

The Adviser has agreed to limit the Fund's total ordinary annual operating
expenses to 1.37% of the Fund's average daily net assets for Class A shares and
2.12% for Class B and Class C shares and X.XX% for Class I shares. The Adviser
has agreed with the Sub-Advisor not to terminate the limitation for at least the
next two years and until 2007 if the Subadvisory Agreement remains in effect.

Securities held by the Fund may also be held by other funds or investment
advisory clients for which the Adviser, the Sub-Adviser or its affiliates
provide investment advice. Because of different investment objectives or other
factors, a particular security may be bought for one or more funds or clients
when one or more other funds or clients are selling the same security. If
opportunities for purchase or sale of securities by the Adviser or Sub-Adviser
for the Fund or for other funds or clients for which the Adviser or Sub-Adviser
renders investment advice arise for consideration at or about the same time,
transactions in such securities will be made, insofar as feasible, for the
respective funds or clients in a manner deemed equitable to all of them. To the
extent that transactions on behalf of more than one client of the Adviser, the
Sub-Adviser or its affiliates may increase the demand for securities being
purchased or the supply of securities being sold, there may be an adverse effect
on price.

Pursuant to its Advisory Agreement, the Adviser is not liable for any error of
judgment or mistake of law or for any loss suffered by the Fund in connection
with the matters to which their respective Agreements relates, except a loss
resulting from willful misfeasance, bad faith or gross negligence on the part of
the Adviser in the performance of its duties or from their reckless disregard of
the obligations and duties under the applicable Agreements.

The Sub-Advisory Agreement provides that the Subadviser shall not be liable for
any losses, claims, damages, liabilities or litigation (including legal and
other expenses) incurred or suffered by the Adviser, the Fund or any of their
affiliates as a result of any error of judgment or mistake of law by the
Sub-Adviser with respect to the Fund, except that the Sub-Adviser shall be
liable for and shall indemnify the Adviser and the Fund from any loss arising
out of or based on (i) the Sub-Adviser's causing the Fund to be in violation of
any applicable federal or state law, rule or regulation or any investment policy
or restriction set forth in the Fund's prospectus or this statement of
additional information or any written policies, procedures, guidelines or
instructions provided in writing to the Sub-Adviser by the Trustees of the Fund
or by the Adviser, (ii) the Sub-Adviser's causing the Fund to fail to satisfy
the requirements for qualification as a regulated investment company under the
Internal Revenue Code, or (iii) the Sub-Adviser's willful misfeasance, bad faith
or gross negligence generally in the performance of its duties unde the
Sub-Advisory Agreement or its reckless disregard of its obligations and duties
under the Sub-Advisory Agreement.

Under the Advisory Agreement, the Fund may use the name "John Hancock" or any
name derived from or similar to it only for so long as the Advisory Agreement or
any extension, renewal or amendment thereof remains in effect. If the Advisory
Agreement is no longer in effect, the Fund (to the extent that it lawfully can)
will cease to use such a name or any other name indicating that it is advised by
or otherwise connected with the Adviser. In addition, the Adviser or the Life
Company may grant the nonexclusive right to use the name "John Hancock" or any
similar name to any other corporation or entity, including but not limited to
any investment company of which the Life Company or any subsidiary or affiliate
thereof or any successor to the business of any subsidiary or affiliate thereof
shall be the investment adviser.

The Advisory Agreement, Sub-Advisory Agreement and the Distribution Agreement
(discussed below) were approved by all Trustees. The Advisory Agreement,
Sub-Advisory Agreement and the Distribution Agreement, will continue in effect
from year to year, provided that its continuance is approved annually both (i)
by the holders of a majority of the outstanding voting securities of the Trust
or by the Trustees, and (ii) by a majority of the Trustees who are not parties
to the Agreement or "interested persons" of any such parties. Each Agreement may
be terminated on 60 days written notice by any party or by vote of a majority of
the outstanding voting securities of the Fund and will terminate automatically
if assigned. The Sub-Advisory Agreement terminates automatically upon the
termination of the Advisory Agreement.

As provided in the Sub-Advisory Agreement, the Adviser (not the Fund) pays the
Sub-Adviser quarterly, in arrears, after the end of each quarter, a fee equal on
an annual basis to the following percentages of the Fund's average daily net
assets: (i) 0.3375% with respect to the first $500,000,000 of the average daily
net asset value of the Fund; (ii) 0.300% with respect to the average daily net
asset value of the Fund in excess of $500,000,000 up to $1,000,000,000; (iii)
0.2625% with respect to the average daily net asset value of the Fund in excess
of $1,000,000,000 up to $1,500,000,000; (iv) 0.225% of the average daily net
asset value of the Fund in excess of $1,500,000,000 up to $2,000,000,000; and
(v) 0.1875% of the average daily net asset value of the Fund in excess of
$2,000,000,000.

During the first year of the Sub-Advisory Agreement, the Adviser has agreed to
pay a minimum fee of $750,000. The sub-advisory fee is subject to reduction if
George Yeager, George Fraise or any other person named as a portfolio manager of
the Fund ceases employment with the Sub-Adviser and is not replaced with a new
team member acceptable to the Adviser. Moreover, during the initial three year
term of the Sub-Advisory Agreement, if the sub-advisory fee exceeds certain
annual targets, payment of any additional subadvisory fee for such year is
deferred until the Sub-Advisory Agreement has been in place for three years, at
which time the deferred amounts will be payable by Adviser only if George Yeager
continues to be employed by the Sub-Adviser and is an active member of the
fund's portfolio management team. The amount of the deferred fee over the three
year period may not exceed $3.25 million.

Under the investment management agreement between the Sub-Adviser and the Fund's
predecessor, U.S. Global Leaders Growth Fund, the predecessor fund paid a
management fee at an annual rate equal to 1.00% of the Fund's average daily net
assets. For the fiscal years ended June 30, 2001, 2000 and 1999, the Fund's
predecessor paid the Sub-Adviser aggregate fees of $845,254, $1,042,045 and
$1,017,545, respectively.

Factors considered by the Independent Trustees in Approving the Advisory
Agreement and the Sub-Advisory Agreement. The 1940 Act requires that the fund's
Advisory Agreement and Sub-Advisory Agreement be initially and, after an initial
term of not more than two years, annually reapproved by both the Board of
Trustees and a majority of the Independent Trustees voting separately. The
Independent Trustees have determined that the terms of the Fund's Advisory
Agreement and Sub-Advisory Agreement are fair and reasonable and that the
contracts are in the fund's best interest. The Independent Trustees believe that
the advisory contracts will enable the Fund to enjoy high quality investment
advisory services at a cost they deem appropriate, reasonable and in the best
interests of the Fund and its shareholders. In making such determinations, the
Independent Trustees met independently from the Interested Trustees of the Fund
and any officers of the Advisr or its affiliates. The Independent Trustees also
relied upon the assistance of counsel to the Independent Trustees and counsel to
the Fund.

In evaluating the Advisory Agreement and Sub-Advisory Agreement , the
Independent Trustees reviewed materials furnished by Adviser, including
information regarding the Adviser, the Sub-Adviser, their respective affiliates
and their personnel, operations and financial condition. The Independent
Trustees also reviewed, among other things:

o the investment performance of the Fund's predecessor, U.S. Global Leaders
Growth Fund;

o the fee charged by Adviser for investment advisory and administrative
services, as well as other compensation received by affiliates of the
Adviser;

o the fee payable to the Subadviser by the Adviser;

o the Fund's projected total operating expenses and the expense limitation
provided by the Adviser; and

o the Sub-Adviser's experience in managing the Fund's predecessor, the
experience of the Adviser in supervising subadvisers and the historical
quality of the services provided by the Adviser.]

Accounting and Legal Services Agreement. The Trust, on behalf of the Fund, is a
party to an Accounting and Legal Services Agreement with the Adviser. Pursuant
to this agreement, the Adviser provides the Fund with certain tax, accounting
and legal services.

Personnel of the Adviser and its affiliates may trade securities for their
personal accounts. The Fund also may hold, or may be buying or selling, the same
securities. To prevent the Fund from being disadvantaged, the adviser(s),
principal underwriter and the Fund have adopted a code of ethics which restricts
the trading activity of those personnel.

DISTRIBUTION CONTRACTS

The Fund has a Distribution Agreement with John Hancock Funds. Under the
agreement, John Hancock Funds is obligated to use its best efforts to sell
shares of each class of the Fund. Shares of the Fund are also sold by selected
broker-dealers (the "Selling Brokers") which have entered into selling agency
agreements with John Hancock Funds. These Selling Brokers are authorized to
designate other intermediaries to receive purchase and redemption orders on
behalf of the Fund. John Hancock Funds accepts orders for the purchase of the
shares of the Fund which are continually offered at net asset value next
determined, plus an applicable sales charge, if any. In connection with the sale
of Fund shares, John Hancock Funds and Selling Brokers receive compensation from
a sales charge imposed, in the case of Class A and Class C shares, at the time
of sale. In the case of Class B or Class C shares, the broker receives
compensation immediately but John Hancock Funds is compensated on a deferred
basis.

The Fund's Trustees adopted Distribution Plans with respect to each class of
shares (the "Plans") pursuant to Rule 12b-1 under the Investment Company Act of
1940. Under the Plans, the Fund will pay distribution and service fees at an
aggregate annual rate of up to 0.25% for class A shares and 1.00% for Class B
and Class C shares of the Fund's average daily net assets attributable to shares
of that class. However, the service fees will not exceed 0.25% of the Fund's
average daily net assets attributable to each class of shares. The distribution
fees will be used to reimburse the John Hancock Funds for its distribution
expenses, including but not limited to: (i) initial and ongoing sales
compensation to Selling Brokers and others (including affiliates of the John
Hancock Funds) engaged in the sale of Fund shares; (ii) marketing, promotional
and overhead expenses incurred in connection with the distribution of Fund
shares; and (iii) with respect to Class B and Class C shares only, interest
expenses on unreimbursed distribution expenses. The service fees will be used to
compensate Selling Brokers and others for providing personal and account
maintenance services to shareholders. In the event that John Hancock Funds is
not fully reimbursed for payments or expenses it incurs under the Class A Plan,
these expenses will not be carried beyond twelve months from the date they were
incurred. Unreimbursed expenses under the Class B and Class C Plans will be
carried forward together with interest on the balance of these unreimbursed
expenses. The Fund does not treat unreimbursed expenses under the Class B and
Class C Plans as a liability of the Fund because the

Trustees may terminate the Class B and /or Class C Plans at any time with no
additional liability for these expenses to the shareholders and the Fund The
Plans and all amendments were approved by the Trustees, including a majority of
the Trustees who are not interested persons of the Fund and who have no direct
or indirect financial interest in the operation of the Plans (the "Independent
Trustees"), by votes cast in person at meetings called for the purpose of voting
on these Plans.

Pursuant to the Plans, at least quarterly, John Hancock Funds provides the Fund
with a written report of the amounts expended under the Plans and the purpose
for which these expenditures were made. The Trustees review these reports on a
quarterly basis to determine their continued appropriateness.

The Plans provide that they will continue in effect only so long as its
continuance is approved at least annually by a majority of both the Trustees and
the Independent Trustees. The Plans provide that they may be terminated without
penalty, (a) by a vote of a majority of the Independent Trustee, and (b) by a
vote of a majority of the Fund's outstanding shares of the applicable class upon
60 days' written notice to John Hancock Funds. The Plans further provide that
they may not be amended to increase the maximum amount of the fees for the
services described therein without the approval of a majority of the outstanding
shares of the class of the Fund which has voting rights with respect to that
Plan. Each plan provides, that no material amendment to the Plans will be
effective unless it is approved by a majority vote of the Trustees and the
Independent Trustees of the Fund. The holders of Class A, Class B and Class C
shares have exclusive voting rights with respect to the Plan applicable to their
respective class of shares. In adopting the Plans, the Trustees concluded that,
in their judgment, there is a reasonable likelihood that the Plans will benefit
the holders of the applicable class of shares of the Fund.

Class I shares of the Fund are not subject to any distribution plan. Expenses
associated with the obligation of John Hancock Funds to use its best efforts to
sell Class I shares will be paid by the Adviser or by John Hancock Funds and
will not be paid from the fees paid under Class A, Class B or Class C Plans.

Amounts paid to the John Hancock Funds by any class of shares of the Fund will
not be used to pay the expenses incurred with respect to any other class of
shares of the Fund; provided, however, that expenses attributable to the Fund as
a whole will be allocated, to the extent permitted by law, according to the
formula based upon gross sales dollars and/or average daily net assets of each
such class, as may be approved from time to time by vote of a majority of the
Trustees. From time to time, the Fund may participate in joint distribution
activities with other Funds and the costs of those activities will be borne by
each Fund in proportion to the relative net asset value of the participating
Fund.

SALES COMPENSATION

As part of their business strategies, the Fund, along with John Hancock Funds,
pays compensation to financial services firms that sell the Fund's shares. These
firms typically pass along a portion of this compensation to your broker or
financial representative.

The two primary sources of broker compensation payments for Class A, Class B and
Class C are (1) the 12 b-1 fees that are paid out of the fund's assets and (2)
sales charges paid by investors. The sales charges and 12b-1 fees are detailed
in the prospectus and under the "Distribution Contracts" in this Statement of
Additional Information. The portions of these expenses that are paid to
financial services firms are shown on the next page. For Class I shares, John
Hancock Funds may make a one-time payment at the time of initial purchase out of
its own resources to a

Selling Broker who sells shares of the Fund. This payment may not exceed 0.15%
of the amount invested.

Whenever you purchase Class A, Class B or Class C shares, the financial services
firm receives a reallowance/payment, as described below. The firm also receives
the first year's 12b-1 service fee at this time. Beginning with the second year
after an investment is made, the financial services firm receives an annual
12b-1 service fee of 0.25% of its total eligible fund net assets. This fee is
paid quarterly in arrears by the Fund.

In addition, from time to time, John Hancock Funds, at its expense, may provide
significant additional compensation to financial services firms in connection
with the sale of shares of the Fund. Such compensation provided by John Hancock
Funds may include, for example, financial assistance to financial services firms
in connection with their marketing and sales development programs for their
registered representatives and other employees, as well as payment for travel
expenses, including lodging, incurred by registered representatives and other
employees for such marketing and sales development programs, seminars for the
public, advertising and sales campaigns regarding one or more Funds, and/or
other financial services firms-sponsored events or activities. From time to
time, John Hancock Funds may make expense reimbursements for special training of
a financial services firm's registered representatives and other employees in
group meetings. Other compensation, such as asset retention fees, finder's fees
and reimbursement for wire transfer fees, may be offered to the extent not
prohibited by law or any self-regulatory agency, such as the NASD.

Broker receives
Sales charge paid Broker receives 12b-1 service Total broker
by investors (% maximum reallowance fee (% of net compensation (1)
Class A investments of offering price) (% of offering price) investment) (3) (% of offering price)
- ------------------- ------------------ --------------------- --------------- ---------------------

Up to $49,999 5.00% 4.01% 0.25% 4.25%
$50,000 - $99,999 4.50% 3.51% 0.25% 3.75%
$100,000 - $249,999 3.50% 2.61% 0.25% 2.85%
$250,000 - $499,999 2.50% 1.86% 0.25% 2.10%
$500,000 - $999,999 2.00% 1.36% 0.25% 1.60%

Investments of Class A share of
$1 million or more (4)
- ----------------------

First $1M - $4,999,999 -- 0.75% 0.25% 1.00%
Next $1 - $5M above that -- 0.25% 0.25% 0.50% (2)
Next $1 or more above that -- 0.00% 0.25% 0.25% (2)

Broker receives
Broker receives 12b-1 service Total broker
maximum reallowance fee (% of net compensation (1)
Class B investments (% of offering price) investment) (3) (% of offering price)
- ------------------- --------------------- --------------- ---------------------

All amounts -- 3.75% 0.25% 4.00%

Broker receives Broker receives
maximum 12b-1 service Total broker
reallowance fee (% of net compensation
Class C Investments (% of offering price) investment) (% of offering price)
- ------------------- --------------------- ----------- ---------------------

Over $1,000,00 or amounts 0.75% 0.25% 1.00%
purchased at NAV
All other amounts 1.00% 1.75% 0.25% 2.00%

Broker receives Broker receives
maximum 12b-1 service Total broker
reallowance fee (% of net compensation (1)
Class I investments (% of offering price) investment) (3) (% of offering price)
- ------------------- --------------------- --------------- ---------------------

All amounts -- 0.00% 0.00% 0.00% (5)

(1) Broker percentages and 12b-1 service fee percentages are calculated from
different amounts, and therefore may not equal total broker compensation
percentages if combined using simple addition.

(2) For Group Investment Programs sales, the maximum total broker compensation
for investments of $1 million or more is 1.00% of the offering price (one year
CDSC of 1.00% applies for each sale).

(3) After first year broker receives 12b-1 fees quarterly in arrears.

(4) John Hancock Funds reduce aggregate investments by the amount of recent
redemptions.

(5) John Hancock Funds may make a one-time payment at the time of initial
purchase out of its own resources to a Selling Broker who sells Class I shares
of the Fund. This payment may be up to 0.15% of the amount invested.

CDSC revenues collected by John Hancock Funds may be used to pay brokers
commissions when there is no initial sales charge.

NET ASSET VALUE

For purposes of calculating the net asset value (NAV) of the Fund's shares, the
following procedures are utilized wherever applicable.

Debt investment securities are valued on the basis of valuations furnished by a
principal market-maker or a pricing service, both of which generally utilize
electronic data processing techniques to determine valuations for normal
institutional size trading units of debt securities without exclusive reliance
upon quoted prices.

Equity securities traded on a principal exchange or NASDAQ National Market
Issues are generally valued at last sale price on the day of valuation.
Securities in the aforementioned category for which no sales are reported and
other securities traded over-the-counter are generally valued at the last
available bid price.

Short-term debt investments which have a remaining maturity of 60 days or less
are generally valued at amortized cost which approximates market value. If
market quotations are not readily available or if in the opinion of the Adviser
any quotation or price is not representative of true market value, the fair
value of the security may be determined in good faith in accordance with
procedures approved by the Trustees.

Foreign securities are valued on the basis of quotations from the primary market
in which they are traded. Any assets or liabilities expressed in terms of
foreign currencies are translated into U.S. dollars by the custodian bank based
on London currency exchange quotations as of 5:00 p.m., London time (12:00 noon,
New York time) on the date of a determination of the Fund's NAV. If quotations
are not readily available, or the value has been materially affected by the
events occurring after the closing of a foreign market, assets are valued by a
method that the Trustees believe accurately reflects fair value.

The NAV of each Fund and class is determined each business day at the close of
regular trading on the New York Stock Exchange (typically 4:00 p.m. Eastern
Time) by dividing a class's net assets by the number of its shares outstanding.
On any day an international market is closed and the New York Stock Exchange is
open, any foreign securities will be valued at the prior day's close with the
current day's exchange rate. Trading of foreign securities may take place on
Saturdays and U.S. business holidays on which the Fund's NAV is not calculated.
Consequently, the Fund's portfolio securities may trade and the NAV of the
Fund's redeemable securities may be significantly affected on days when a
shareholder has no access to the Fund.

INITIAL SALES CHARGE ON CLASS A AND CLASS C SHARES

Shares of the Fund are offered at a price equal to their net asset value plus a
sales charge which, at the option of the purchaser, may be imposed either at the
time of purchase (the "initial sales charge alternative") or on a contingent
deferred basis (the "deferred sales charge alternative"). The fund no longer
issues share certificates. Shares are electronically recorded. The Trustees
reserve the right to change or waive the Fund's minimum investment requirements
and to reject any order to purchase shares (including purchase by exchange) when
in the judgment of the Adviser such rejection is in the Fund's best interest.

The sales charges applicable to purchases of Class A and Class C shares of the
Fund are described in the Prospectus. Methods of obtaining reduced sales charges
referred to generally in the Prospectus are described in detail below. In
calculating the sales charge applicable to current

purchases of Class A shares of the Fund, the investor is entitled to accumulate
current purchases with the greater of the current value (at offering price) of
the Class A shares of the Fund, owned by the investor, or if John Hancock
Signature Services, Inc. ("Signature Services") is notified by the investor's
dealer or the investor at the time of the purchase, the cost of the Class A
shares owned.

Without Sales Charges. Class A shares may be offered without a front-end sales
charge or contingent deferred sales charge ("CDSC") to various individuals and
institutions as follows:

o A Trustee or officer of the Trust; a Director or officer of the Adviser
and its affiliates, subadviser or Selling Brokers; employees or sales
representatives of any of the foregoing; retired officers, employees or
Directors of any of the foregoing; a member of the immediate family
(spouse, children, grandparents, grandchildren, mother, father, sister,
brother, mother-in-law, father-in-law, daughter-in-law, son-in-law, niece,
nephew and same sex domestic partner) of any of the foregoing; or any
fund, pension, profit sharing or other benefit plan for the individuals
described above.

o A broker, dealer, financial planner, consultant or registered investment
advisor that has entered into a signed agreement with John Hancock Funds
providing specifically for the use of Fund shares in fee-based investment
products or services made available to their clients.

o A former participant in an employee benefit plan with John Hancock funds,
when he or she withdraws from his or her plan and transfers any or all of
his or her plan distributions directly to the Fund.

o A member of a class action lawsuit against insurance companies who is
investing settlement proceeds.

o Retirement plans participating in Merrill Lynch servicing programs, if the
Plan has more than $3 million in assets or 500 eligible employees at the
date the Plan Sponsor signs the Merrill Lynch Recordkeeping Service
Agreement. See your Merrill Lynch financial consultant for further
information.

o Retirement plans investing through the PruArray Program sponsored by
Prudential Securities.

o Pension plans transferring assets from a John Hancock variable annuity
contract to the Fund pursuant to an exemptive application approved by the
Securities and Exchange Commission.

o Participant directed retirement plans with at least 100 eligible employees
at the inception of the Fund account. Each of these investors may purchase
Class A shares with no initial sales charge. However, if the shares are
redeemed within 12 months after the end of the calendar year in which the
purchase was made, a CDSC will be imposed at the following rate:

Amount Invested CDSC Rate
--------------- ---------

$1 to $4,999,999 1.00%
Next $5 million to $9,999,999 0.50%
Amounts of $10 million and over 0.25%

o Any shareholder of the John Hancock U.S. Global Leaders Growth Fund as of
May 17, 2002.

Class C shares may be offered without a front-end sales charge to:

o Investments of redemption proceeds from a non-John Hancock mutual fund.

o Group Retirement plan products for which John Hancock Signature Services
performs recordkeeping and administrative services. (These plans include
403(b), Simple IRA, SEP and SARSEP plans.) Also included are plans
formerly record kept by John Hancock Signature Services (including
401(k)).

o Group Retirement plan products sold through third party administrators
under the John Hancock SELECT retirement plan program. (These plans
include 401(k), Money Purchase and Profit Sharing plans.)

o An investor who buys through Merrill Lynch omnibus account. However, a
CDSC may apply if the shares are sold within 12 months of purchase.

Class A and Class C shares may also be purchased without an initial sales charge
in connection with certain liquidation, merger or acquisition transactions
involving other investment companies or personal holding companies.

Combination Privilege. In calculating the sales charge applicable to purchases
of Class A shares made at one time, the purchases will be combined to reduce
sales charges if made by (a) an individual, his or her spouse and their children
under the age of 21, purchasing securities for his or their own account, (b) a
trustee or other fiduciary purchasing for a single trust, estate or fiduciary
account and (c) groups which qualify for the Group Investment Program (see
below). A company's (not an individual's) qualified and non-qualified retirement
plan investments can be combined to take advantage of this privilege. Further
information about combined purchases, including certain restrictions on combined
group purchases, is available from Signature Services or a Selling Broker's
representative.

Accumulation Privilege. Investors (including investors combining purchases) who
are already Class A shareholders may also obtain the benefit of the reduced
sales charge by taking into account not only the amount being invested but also
the investor's purchase price or current value of the Class A shares of all John
Hancock funds which carry a sales charge already held by such person. Class A
shares of John Hancock money market funds will only be eligible for the
accumulation privilege if the investor has previously paid a sales charge on the
amount of those shares. Retirement plan investors may include the value of Class
B shares if Class B shares held are greater than $1 million. Retirement plans
must notify Signature Services to utilize. A company's (not an individual's)
qualified and non-qualified retirement plan investments can be combined to take
advantage of this privilege.

Group Investment Program. Under the Combination and Accumulation Privileges, all
members of a group may combine their individual purchases of Class A shares to
potentially qualify for breakpoints in the sales charge schedule. This feature
is provided to any group which (1) has been in existence for more than six
months, (2) has a legitimate purpose other than the purchase of mutual fund
shares at a discount for its members, (3) utilizes salary deduction or similar
group methods of payment, and (4) agrees to allow sales materials of the fund in
its mailings to members at a reduced or no cost to John Hancock Funds.

Letter of Intention. Reduced sales charges are also applicable to investments
made pursuant to a Letter of Intention (the "LOI"), which should be read
carefully prior to its execution by an investor. The Fund offers two options
regarding the specified period for making investments under the LOI. All
investors have the option of making their investments over a specified period of
thirteen (13) months. Investors who are using the Fund as a funding medium for a
retirement plan, however, may opt to make the necessary investments called for
by the LOI over a forty-eight (48) month period. These retirement plans include
traditional, Roth and Education IRAs, SEP, SARSEP, 401(k), 403(b) (including
TSAs), SIMPLE IRA, SIMPLE 401(k), Money Purchase Pension, Profit Sharing and
Section 457 plans. An individual's non-qualified and qualified retirement plan
investments cannot be combined to satisfy LOI of 48 months. Such an investment
(including accumulations and combinations but not including reinvested
dividends) must aggregate $50,000 or more during the specified period from the
date of the LOI or from a date within ninety (90) days prior thereto, upon
written request to Signature Services. The sales charge applicable to all
amounts invested under the LOI is computed as if the aggregate amount intended
to be invested had been invested immediately. If such aggregate amount is not
actually invested, the difference in the sales charge actually paid and the
sales charge payable had the LOI not been in effect is due from the investor.
However, for the purchases actually made within the specified period (either 13
or 48 months) the sales charge applicable will not be higher than that which
would have applied (including accumulations and combinations) had the LOI been
for the amount actually invested.

The LOI authorizes Signature Services to hold in escrow sufficient Class A
shares (approximately 5% of the aggregate) to make up any difference in sales
charges on the amount intended to be invested and the amount actually invested,
until such investment is completed within the specified period, at which time
the escrowed Class A shares will be released. If the total investment specified
in the LOI is not completed, the Class A shares held in escrow may be redeemed
and the proceeds used as required to pay such sales charge as may be due. By
signing the LOI, the investor authorizes Signature Services to act as his
attorney-in-fact to redeem any escrowed Class A shares and adjust the sales
charge, if necessary. A LOI does not constitute a binding commitment by an
investor to purchase, or by the Fund to sell, any additional Class A shares and
may be terminated at any time.

Because Class I shares are sold at net asset value without the imposition of any
sales charge, none of the privileges described under these captions are
available to Class I investors.

DEFERRED SALES CHARGE ON CLASS B AND CLASS C SHARES

Investments in Class B shares are purchased at net asset value per share without
the imposition of an initial sales charge so that the Fund will receive the full
amount of the purchase payment.

Contingent Deferred Sales Charge. Class B and Class C shares which are redeemed
within six years or one year of purchase, respectively will be subject to a CDSC
at the rates set forth in the Prospectus as a percentage of the dollar amount
subject to the CDSC. The charge will be assessed on an amount equal to the
lesser of the current market value or the original purchase cost of the Class B
or Class C shares being redeemed. No CDSC will be imposed on increases in
account value above the initial purchase price or on shares derived from
reinvestment of dividends or capital gains distributions.

Class B shares are not available to retirement plans that had more than 100
eligible employees at the inception of the Fund account.

The amount of the CDSC, if any, will vary depending on the number of years from
the time of payment for the purchase of Class B shares until the time of
redemption of such shares. Solely for purposes of determining the number of
years from the time of any payment for the purchases

of both Class B and Class C shares, all payments during a month will be
aggregated and deemed to have been made on the first day of the month.

In determining whether a CDSC applies to a redemption, the calculation will be
determined in a manner that results in the lowest possible rate being charged.
It will be assumed that your redemption comes first from shares you have held
beyond the six-year CDSC redemption period for Class B or one year CDSC
redemption period for Class C, or those you acquired through dividend and
capital gain reinvestment, and next from the shares you have held the longest
during the six-year period for Class B shares. For this purpose, the amount of
any increase in a share's value above its initial purchase price is not subject
to a CDSC. Thus, when a share that has appreciated in value is redeemed during
the CDSC period, a CDSC is assessed only on its initial purchase price.

When requesting a redemption for a specific dollar amount, please indicate if
you require the proceeds to equal the dollar amount requested. If not indicated,
only the specified dollar amount will be redeemed from your account and the
proceeds will be less any applicable CDSC.

Example:

You have purchased 100 Class B shares at $10 per share. The second year after
your purchase, your investment's net asset value per share has increased by $2
to $12, and you have gained 10 additional shares through dividend reinvestment.
If you redeem 50 shares at this time your CDSC will be calculated as follows:

o Proceeds of 50 shares redeemed at $12 per shares (50 x 12) $600.00
o *Minus Appreciation ($12 - $10) x 100 shares (200.00)
o Minus proceeds of 10 shares not subject to CDSC (dividend reinvestment) (120.00)
-------
o Amount subject to CDSC $280.00

*The appreciation is based on all 100 shares in the account not just the
shares being redeemed.

Proceeds from the CDSC are paid to John Hancock Funds and are used in whole or
in part by John Hancock Funds to defray its expenses related to providing
distribution-related services to the Fund in connection with the sale of the
Class B and Class C shares, such as the payment of compensation to select
Selling Brokers for selling Class B and Class C shares. The combination of the
CDSC and the distribution and service fees facilitates the ability of the Fund
to sell the Class B and Class C shares without a sales charge being deducted at
the time of the purchase.

Waiver of Contingent Deferred Sales Charge. The CDSC will be waived on
redemptions of Class B and Class C shares and of Class A shares that are subject
to a CDSC, unless indicated otherwise, in the circumstances defined below:

For all account types:

* Redemptions made pursuant to the Fund's right to liquidate your account if
you own shares worth less than $1,000.

* Redemptions made under certain liquidation, merger or acquisition
transactions involving other investment companies or personal holding
companies.

* Redemptions due to death or disability. (Does not apply to trust accounts
unless trust is being dissolved.)

* Redemptions made under the Reinstatement Privilege, as described in "Sales
Charge Reductions and Waivers" of the Prospectus.

* Redemption of Class B and Class C shares made under a periodic withdrawal
plan or redemptions for fees charged by planners or advisors for advisory
services, as long as your annual redemptions do not exceed 12% of your
account value, including reinvested dividends, at the time you established
your periodic withdrawal plan and 12% of the value of subsequent
investments (less redemptions) in that account at the time you notify
Signature Services. (Please note, this waiver does not apply to periodic
withdrawal plan redemptions of Class A shares that are subject to a CDSC.)

* Redemptions by Retirement plans participating in Merrill Lynch servicing
programs, if the Plan has less than $3 million in assets or 500 eligible
employees at the date the Plan Sponsor signs the Merrill Lynch
Recordkeeping Service Agreement. See your Merrill Lynch financial
consultant for further information.

* Redemptions of Class A shares made after one year from the inception date
of a retirement plan at John Hancock.

* Redemption of Class A shares by retirement plans that invested through the
PruArray Program sponsored by Prudential Securities.

For Retirement Accounts (such as traditional, Roth and Education IRAs, SIMPLE
IRAs, SIMPLE 401(k), Rollover IRA, TSA, 457, 403(b), 401(k), Money Purchase
Pension Plan, Profit-Sharing Plan and other plans as described in the Internal
Revenue Code) unless otherwise noted.

* Redemptions made to effect mandatory or life expectancy distributions
under the Internal Revenue Code. (Waiver based on required, minimum
distribution calculations for John Hancock Mutual Fund IRA assets only.)

* Returns of excess contributions made to these plans.

* Redemptions made to effect distributions to participants or beneficiaries
from employer sponsored retirement plans under sections 401(a) (such as
Money Purchase Pension Plans and Profit Sharing Plan/401(k) Plans), 457
and 408 (SEPs and SIMPLE IRAs) of the Internal Revenue Code.

* Redemptions from certain IRA and retirement plans that purchased shares
prior to October 1, 1992 and certain IRA plans that purchased shares prior
to May 15, 1995.

Please see matrix for some examples.

- ---------------------------------------------------------------------------------------------------------------
Type of 401 (a) Plan 403 (b) 457 IRA, IRA Non-retirement
Distribution (401 (k), MPP, Rollover
PSP) 457 & 408
(SEPs & Simple
IRAs)
- ---------------------------------------------------------------------------------------------------------------

Death or Disability Waived Waived Waived Waived Waived
- ---------------------------------------------------------------------------------------------------------------
Over 70 1/2 Waived Waived Waived Waived for 12% of account
required value annually
minimum in periodic
distributions* payments
or 12% of
account value
annually in
periodic
payments.
- ---------------------------------------------------------------------------------------------------------------
Between 59 1/2 Waived Waived Waived Waived for Life 12% of account
and 70 1/2 Expectancy or value annually
12% of account in periodic
value annually payments
in periodic
payments.
- ---------------------------------------------------------------------------------------------------------------
Under 59 1/2 Waived for Waived for Waived for Waived for 12% of account
(Class B only) annuity annuity annuity annuity value annually
payments (72t) payments (72t) payments (72t) payments (72t) in periodic
or 12% of or 12% of or 12% of or 12% of payments
account value account value account value account value
annually in annually in annually in annually in
periodic periodic periodic periodic
payments. payments. payments. payments.
- ---------------------------------------------------------------------------------------------------------------
Loans Waived Waived N/A N/A N/A
- ---------------------------------------------------------------------------------------------------------------
Termination of Plan Not Waived Not Waived Not Waived Not Waived N/A
- ---------------------------------------------------------------------------------------------------------------
Hardships Waived Waived Waived N/A N/A
- ---------------------------------------------------------------------------------------------------------------
Qualified Domestic Waived Waived Waived N/A N/A
Relations Orders
- ---------------------------------------------------------------------------------------------------------------
Termination of Waived Waived Waived N/A N/A
Employment Before
Normal Retirement Age
- ---------------------------------------------------------------------------------------------------------------
Return of Excess Waived Waived Waived Waived N/A
- ---------------------------------------------------------------------------------------------------------------

* Required minimum distributions based on John Hancock Mutual Fund IRA assets
only.

If you qualify for a CDSC waiver under one of these situations, you must notify
Signature Services at the time you make your redemption. The waiver will be
granted once Signature Services has confirmed that you are entitled to the
waiver.

SPECIAL REDEMPTIONS

Although it would not normally do so, the Fund has the right to pay the
redemption price of shares of the Fund in whole or in part in portfolio
securities as prescribed by the Trustees. When the shareholder sells portfolio
securities received in this fashion, the shareholders will incur a brokerage
charge. Any such securities would be valued for the purposes of making such
payment at the same value as used in determining net asset value. The Fund has,
however, elected to be governed by Rule 18f-1 under the Investment Company Act.
Under that rule, the Fund must redeem its shares for cash except to the extent
that the redemption payments to any shareholder during any 90-day period would
exceed the lesser of $250,000 or 1% of the Fund's net asset value at the
beginning of such period.

ADDITIONAL SERVICES AND PROGRAMS

Exchange Privilege. The Fund permits exchanges of shares of any class of a fund
for shares of the same class in any other John Hancock fund offering that class.

Exchanges between funds with shares that are not subject to a CDSC are based on
their respective net asset values. No sales charge or transaction charge is
imposed. Shares of the Fund which are subject to a CDSC may be exchanged into
shares of any of the other John Hancock funds that are subject to a CDSC without
incurring the CDSC; however, the shares acquired in an exchange will be subject
to the CDSC schedule of the shares acquired if and when such shares are redeemed
(except that shares exchanged into John Hancock 500 Index Fund will retain the
exchanged fund's CDSC schedule). For purposes of computing the CDSC payable upon
redemption of shares acquired in an exchange, the holding period of the original
shares is added to the holding period of the shares acquired in an exchange.

If a retirement plan exchanges the plan's Class A account in its entirety from
the Fund to a non-John Hancock investment, the one-year CDSC applies.

If a shareholder exchanges Class B shares purchased prior to January 1, 1994 for
Class B shares of any other John Hancock fund, the acquired shares will continue
to be subject to the CDSC schedule that was in effect when the exchanged shares
were purchased.

The Fund reserves the right to require that previously exchanged shares (and
reinvested dividends) be in the Fund for 90 days before a shareholder is
permitted a new exchange.

The Fund may refuse any exchange order. The Fund may change or cancel its
exchange policies at any time, upon 60 days' notice to its shareholders.

An exchange of shares is treated as a redemption of shares of one fund and the
purchase of shares of another for Federal Income Tax purposes. An exchange may
result in a taxable gain or loss. See "TAX STATUS".

Systematic Withdrawal Plan. The Fund permits the establishment of a Systematic
Withdrawal Plan. Payments under this plan represent proceeds arising from the
redemption of Fund shares which may result in realization of gain or loss for
purposes of Federal, state and local income taxes. The maintenance of a
Systematic Withdrawal Plan concurrently with purchases of additional shares of
the Fund could be disadvantageous to a shareholder because of the initial sales
charge payable on such purchases of Class A shares and the CDSC imposed on
redemptions of Class B and Class C shares and because redemptions are taxable
events. Therefore, a shareholder should not purchase shares at the same time a
Systematic Withdrawal Plan is in effect. The Fund reserves the right to modify
or discontinue the Systematic Withdrawal Plan of

any shareholder on 30 days' prior written notice to such shareholder, or to
discontinue the availability of such plan in the future. The shareholder may
terminate the plan at any time by giving proper notice to Signature Services.

Monthly Automatic Accumulation Program ("MAAP"). The program is explained in the
Prospectus. The program, as it relates to automatic investment checks, is
subject to the following conditions:

The investments will be drawn on or about the day of the month indicated.

The privilege of making investments through the MAAP may be revoked by Signature
Services without prior notice if any investment is not honored by the
shareholder's bank. The bank shall be under no obligation to notify the
shareholder as to the non-payment of any checks.

The program may be discontinued by the shareholder either by calling Signature
Services or upon written notice to Signature Services which is received at least
five (5) business days prior to the order date of any investment.

Reinstatement or Reinvestment Privilege. If Signature Services is notified prior
to reinvestment, a shareholder who has redeemed Fund shares may, within 120 days
after the date of redemption, reinvest without payment of a sales charge any
part of the redemption proceeds in shares of the same class of the Fund or
another John Hancock fund, subject to the minimum investment limit in that fund.
The proceeds from the redemption of Class A shares may be reinvested at net
asset value without paying a sales charge in Class A shares of the Fund or in
Class A shares of any John Hancock fund. If a CDSC was paid upon a redemption, a
shareholder may reinvest the proceeds from this redemption at net asset value in
additional shares of the class from which the redemption was made. The
shareholder's account will be credited with the amount of any CDSC charged upon
the prior redemption and the new shares will continue to be subject to the CDSC.
The holding period of the shares acquired through reinvestment will, for
purposes of computing the CDSC payable upon a subsequent redemption, include the
holding period of the redeemed shares.

To protect the interests of other investors in the Fund, the Fund may cancel the
reinvestment privilege of any parties that, in the opinion of the Fund, are
using market timing strategies or making more than seven exchanges per owner or
controlling party per calendar year. Also, the Fund may refuse any reinvestment
request.

The Fund may change or cancel its reinvestment policies at any time.

A redemption or exchange of Fund shares is a taxable transaction for Federal
income tax purposes even if the reinvestment privilege is exercised, and any
gain or loss realized by a shareholder on the redemption or other disposition of
Fund shares will be treated for tax purposes as described under the caption "TAX
STATUS."

Retirement plans participating in Merrill Lynch's servicing programs:

Class A shares are available at net asset value for plans with $3 million in
plan assets or 500 eligible employees at the date the Plan Sponsor signs the
Merrill Lynch Recordkeeping Service Agreement. If the plan does not meet either
of these limits, Class A shares are not available.

For participating retirement plans investing in Class B shares, shares will
convert to Class A shares after eight years, or sooner if the plan attains
assets of $5 million (by means of a CDSC-free redemption/purchase at net asset
value).

PURCHASES AND REDEMPTIONS THROUGH THIRD PARTIES

Shares of the Fund may be purchased or redeemed through certain broker-dealers
or Service Agents ("Brokers"). Brokers may charge for their services or place
limitations on the extent to which you may use the services of the Fund. The
Fund will be deemed to have received a purchase or redemption order when an
authorized broker, or if applicable, a broker's authorized designee, receives
the order. If a broker is an agent or designee of the Fund, orders are processed
at the NAV next calculated after the broker receives the order. The broker must
segregate any orders it receives after the close of regular trading on the New
York Stock Exchange and transmit those orders to the Fund for execution at NAV
next determined. Some brokers that maintain nominee accounts with the Fund for
their clients charge an annual fee on the average net assets held in such
accounts for accounting, servicing, and distribution services they provide with
respect to the underlying Fund shares. The Adviser, the Fund and/or John Hancock
Funds, Inc. (the Fund's principal distributor), share in the expense of these
fees.

DESCRIPTION OF THE FUND'S SHARES

The Trustees of the Trust are responsible for the management and supervision of
the Fund. The Declaration of Trust permits the Trustees to issue an unlimited
number of full and fractional shares of beneficial interest of the Fund without
par value. Under the Declaration of Trust, the Trustees have the authority to
create and classify shares of beneficial interest in separate series and classes
without further action by shareholders. As of the date of this Statement of
Additional Information, the Trustees have authorized shares of the Fund and four
other series. Additional series may be added in the future. The Trustees have
also authorized the issuance of four classes of shares of the Fund, designated
as Class A, Class B, Class C and Class I.

The shares of each class of the Fund represent an equal proportionate interest
in the aggregate net assets attributable to that class of the Fund. Holders of
each class of shares have certain exclusive voting rights on matters relating to
their respective distribution plans. The different classes of the Fund may bear
different expenses relating to the cost of holding shareholder meetings
necessitated by the exclusive voting rights of any class of shares.

Dividends paid by the Fund, if any, with respect to each class of shares will be
calculated in the same manner, at the same time and on the same day and will be
in the same amount, except for differences resulting from the facts that (i) the
distribution and service fees relating to each class will be borne exclusively
by that class, (ii) Class B and Class C shares will pay higher distribution and
service fees than Class A shares and (iii) each class of shares will bear any
class expenses properly allocable to that class of shares, subject to the
conditions the Internal Revenue Service imposes with respect to the
multiple-class structures. Similarly, the net asset value per share may vary
depending on which class of shares are purchased. No interest will be paid on
uncashed dividend or redemption checks.

In the event of liquidation, shareholders of each class are entitled to share
pro rata in the net assets of the Fund available for distribution to these
shareholders. Shares entitle their holders to one vote per share, are freely
transferable and have no preemptive, subscription or conversion rights. When
issued, shares are fully paid and non-assessable, except as set forth below.

Unless otherwise required by the Investment Company Act or the Declaration of
Trust, the Fund has no intention of holding annual meetings of shareholders.
Fund shareholders may remove a Trustee by the affirmative vote of at least
two-thirds of the Trust's outstanding shares and the Trustees shall promptly
call a meeting for such purpose when requested to do so in writing by the record
holders of not less than 10% of the outstanding shares of the Trust.
Shareholders may, under certain circumstances, communicate with other
shareholders in connection with requesting

a special meeting of shareholders. However, at any time that less than a
majority of the Trustees holding office were elected by the shareholders, the
Trustees will call a special meeting of shareholders for the purpose of electing
Trustees.

Under Massachusetts law, shareholders of a Massachusetts business trust could,
under certain circumstances, be held personally liable for acts or obligations
of the Fund. However, the Fund's Declaration of Trust contains an express
disclaimer of shareholder liability for acts, obligations or affairs of the
Fund. The Declaration of Trust also provides for indemnification out of the
Fund's assets for all losses and expenses of any shareholder held personally
liable for reason of being or having been a shareholder. The Declaration of
Trust also provides that no series of the Trust shall be liable for the
liabilities of any other series. Furthermore, no fund included in this Fund's
prospectus shall be liable for the liabilities of any other John Hancock Fund.
Liability is therefore limited to circumstances in which the Fund itself would
be unable to meet its obligations, and the possibility of this occurrence is
remote.

The Fund reserves the right to reject any application which conflicts with the
Fund's internal policies or the policies of any regulatory authority. John
Hancock Funds does not accept starter, credit card or third party checks. All
checks returned by the post office as undeliverable will be reinvested at net
asset value in the fund or funds from which a redemption was made or dividend
paid. Information provided on the account application may be used by the Fund to
verify the accuracy of the information or for background or financial history
purposes. A joint account will be administered as a joint tenancy with right of
survivorship, unless the joint owners notify Signature Services of a different
intent. A shareholder's account is governed by the laws of The Commonwealth of
Massachusetts. For telephone transactions, the transfer agent will take measures
to verify the identity of the caller, such as asking for name, account number,
Social Security or other taxpayer ID number and other relevant information. If
appropriate measures are taken, the transfer agent is not responsible for any
losses that may occur to any account due to an unauthorized telephone call. Also
for your protection telephone transactions are not permitted on accounts whose
names or addresses have changed within the past 30 days. Proceeds from telephone
transactions can only be mailed to the address of record.

Selling activities for the Fund may not take place outside the U.S. except with
U.S. military bases, APO addresses and U.S. diplomats. Brokers of record on
Non-U.S. investors' accounts with foreign mailing addresses are required to
certify that all sales activities have occurred, and in the future will occur,
only in the U.S. A foreign corporation may purchase shares of the Fund only if
it has a U.S. mailing address.

TAX STATUS

The Fund, is treated as a separate entity for accounting and tax purposes, has
qualified and elected to be treated as a "regulated investment company" under
Subchapter M of the Internal Revenue Code of 1986, as amended (the "Code"), and
intends to continue to qualify for each taxable year. As such and by complying
with the applicable provisions of the Code regarding the sources of its income,
the timing of its distributions and the diversification of its assets, the Fund
will not be subject to Federal income tax on its taxable income (including net
realized capital gains) which is distributed to shareholders in accordance with
the timing requirements of the Code.

The Fund will be subject to a 4% nondeductible Federal excise tax on certain
amounts not distributed (and not treated as having been distributed) on a timely
basis in accordance with annual minimum distribution requirements. The Fund
intends under normal circumstances to seek to avoid or minimize liability for
such tax by satisfying such distributions requirements.

Distribution from the Fund's current or accumulated earnings and profits ("E&P")
will be taxable under the Code for investors who are subject to tax. If these
distributions are paid from the Fund's "investment company taxable income," they
will be taxable as ordinary income; and if they are paid from the Fund's "net
capital gain" they will be taxable as capital gain. (Net capital gain is the
excess (if any) of net long-term capital gain over net short-term capital loss,
and investment company taxable income is all taxable income and capital gains,
other than net capital gain, after reduction by deductible expenses). Some
distributions may be paid in January but may be taxable to shareholders as if
they had been received on December 31 of the previous year. The tax treatment
described above will apply without regard to whether distributions are received
in cash or reinvested in additional shares of the Fund.

Distributions, if any, in excess of E&P will constitute a return of capital
under the Code, which will first reduce an investor's federal tax basis in Fund
shares and then, to the extent such basis is exceeded, will generally give rise
to capital gains. Shareholders who have chosen automatic reinvestment of their
distributions will have a federal tax basis in each share received pursuant to
such a reinvestment equal to the amount of cash they would have received had
they elected to receive the distribution in cash, divided by the number of
shares received in the reinvestment.

The Fund may be subject to withholding and other taxes imposed by foreign
countries with respect to their investments in foreign securities. Tax
conventions between certain countries and the U.S. may reduce or eliminate such
taxes. Because more than 50% of the Fund's assets at the close of any taxable
year will not consist of stocks or securities of foreign corporations, the Fund
will be unable to pass such taxes through to shareholders (as additional income)
along with a corresponding entitlement to a foreign tax credit or deduction. The
Fund will deduct the foreign taxes it pays in determining the amount it has
available for distribution to shareholders.

If the Fund invests in stock (including an option to acquire stock such as is
inherent in a convertible bond) of certain foreign corporations that receive at
least 75% of their annual gross income from passive sources (such as interest,
dividends, certain rents and royalties or capital gain) or hold at least 50% of
their asset in investments producing such passive income ("passive foreign
investment companies"), the Fund could be subject to Federal income tax and
additional interest charges on "excess distributions" received from such
companies or gain from the sale of stock in such companies, even if all income
or gain actually received by the Fund is timely distributed to its shareholders.
The Fund would not be able to pass through to its shareholders any credit or
deduction for such a tax. An election may be available to ameliorate these
adverse tax consequences, but could require the Fund to recognize taxable income
or gain without the concurrent receipt of cash. These investments could also
result in the treatment of associated capital gains as ordinary income. The Fund
may limit and/or manage its holdings in passive foreign investment companies or
make an available election to minimize its tax liability or maximize its return
for these investments.

Foreign exchange gains and losses realized by the Fund in connection with
certain transactions involving foreign currency-denominated debt securities,
certain foreign currency options, foreign currencies, or payables or receivables
denominated in foreign currency are subject to Section 988 of the Code, which
generally causes such gains and losses to be treated as ordinary income and
losses and may affect the amount, timing and character of distributions to
shareholders. Transactions in foreign currencies that are not directly related
to the Fund's investment in stock or securities, including speculative currency
positions could under future Treasury regulations produce income not among the
types of "qualifying income" from which the Fund must derive at least 90% of its
gross income from each taxable year. If the net foreign exchange loss for a year
treated as ordinary loss under Section 988 were to exceed the Fund's investment
company taxable income computed without regard to such loss the resulting
overall ordinary loss for such year would not be deductible by the Fund or its
shareholders in future years.

Certain options, futures, and forward foreign currency contracts undertaken by
the Fund could cause the Fund to recognize gains or losses from marking to
market even though its positions have not been sold or terminated and affect the
character as long-term or short-term (or, in the case of foreign currency
contracts, as ordinary income or loss) and timing of some capital gains and
losses realized by the Fund. Additionally, the Fund may be required to recognize
gain, but not loss, if an option, short sales or other transaction is treated as
a constructive sale of an appreciated financial position in the Fund's
portfolio. Also, certain of the Fund's losses on its transactions involving
options, futures or forward contracts and/or offsetting or successor portfolio
positions may be deferred rather than being taken into account currently in
calculating the Fund's taxable income or gains. Certain of such transactions may
also cause the Fund to dispose of investments sooner than would otherwise have
occurred. These transactions may therefore affect the amount, timing and
character of the Fund's distributions to shareholders. The Fund will take into
account the special tax rules (including consideration of available elections)
applicable to options, futures and forward contracts in order to seek to
minimize any potential adverse tax consequences.

The amount of the Fund's net realized capital gains, if any, in any given year
will vary depending upon the Adviser's current investment strategy and whether
the Adviser believes it to be in the best interest of the Fund to dispose of
portfolio securities and/or engage in options transactions that will generate
capital gains. At the time of an investor's purchase of Fund shares, a portion
of the purchase price is often attributable to realized or unrealized
appreciation in the Fund's portfolio or undistributed taxable income of the
Fund. Consequently, subsequent distributions on those shares from such
appreciation or income may be taxable to such investor even if the net asset
value of the investor's shares is, as a result of the distributions, reduced
below the investor's cost for such shares, and the distributions in reality
represent a return of a portion of the purchase price.

Upon a redemption or other disposition of shares of the Fund (including by
exercise of the exchange privilege) that in a transaction is treated as a sale
for tax purposes, a shareholder will ordinarily realize a taxable gain or loss
depending upon the amount of the proceeds and the investor's basis in his
shares. Such gain or loss will be treated as capital gain or loss if the shares
are capital assets in the shareholder's hands. A sales charge paid in purchasing
shares of the Fund cannot be taken into account for purposes of determining gain
or loss on the redemption or exchange of such shares within 90 days after their
purchase to the extent shares of the Fund or another John Hancock fund are
subsequently acquired without payment of a sales charge pursuant to the
reinvestment or exchange privilege. This disregarded charge will result in an
increase in the shareholder's tax basis in the shares subsequently acquired.
Also, any loss realized on a redemption or exchange may be disallowed to the
extent the shares disposed of are replaced with other shares of the Fund within
a period of 61 days beginning 30 days before and ending 30 days after the shares
are disposed of, such as pursuant to automatic dividend reinvestments. In such a
case, the basis of the shares acquired will be adjusted to reflect the
disallowed loss. Any loss realized upon the redemption of shares with a tax
holding period of six months or less will be treated as a long-term capital loss
to the extent of any amounts treated as distributions of long-term capital gain
with respect to such shares. Shareholders should consult their own tax advisers
regarding their particular circumstances to determine whether a disposition of
Fund shares is properly treated as a sale for tax purposes, as is assumed in the
foregoing discussion.

Although its present intention is to distribute, at least annually, all net
capital gain, if any, the Fund reserves the right to retain and reinvest all or
any portion of the excess, as computed for Federal income tax purposes, of net
long-term capital gain over net short-term capital loss in any year. The Fund
will not in any event distribute net capital gain realized in any year to the
extent that a capital loss is carried forward from prior years against such
gain. To the extent such excess was retained and not exhausted by the carry
forward of prior years' capital losses, it would

be subject to Federal income tax in the hands of the Fund. Upon proper
designation of this amount by the Fund, each shareholder would be treated for
Federal income tax purposes as if the Fund had distributed to him on the last
day of its taxable year his pro rata share of such excess, and he had paid his
pro rata share of the taxes paid by the Fund and reinvested the remainder in the
Fund. Accordingly, each shareholder would (a) include his pro rata share of such
excess as long-term capital gain in his return for his taxable year in which the
last day of the Fund's taxable year falls, (b) be entitled either to a tax
credit on his return for, or to a refund of, his pro rata share of the taxes
paid by the Fund, and (c) be entitled to increase the adjusted tax basis for his
shares in the Fund by the difference between his pro rata share of such excess
and his pro rata share of such taxes.

For Federal income tax purposes, the Fund is permitted to carry forward a net
realized capital loss in any year to offset net capital gains, if any, during
the eight years following the year of the loss. To the extent subsequent net
capital gains are offset by such losses, they would not result in Federal income
tax liability to the Fund and, as noted above, would not be distributed as such
to shareholders.

Investment in debt obligations that are at risk of or in default present special
tax issues for the Fund. Tax rules are not entirely clear about issues such as
when the Fund may cease to accrue interest, original issue discount, or market
discount, when and to what extent deductions may be taken for bad debts or
worthless securities, how payments received on obligations in default should be
allocated between principal and income, and whether exchanges of debt
obligations in a workout context are taxable. These and other issues will be
addressed by the Fund, in the event it acquires or holds any such obligations,
in order to reduce the risk of distributing insufficient income to preserve its
status as a regulated investment company and seeks to avoid becoming subject to
Federal income or excise tax.

For purposes of the dividends-received deduction available to corporations,
dividends received by the Fund, if any, from U.S. domestic corporations in
respect of the stock of such corporations held by the Fund, for U.S. Federal
income tax purposes, for at least 46 days (91 days in the case of certain
preferred stock) during a prescribed period extending before and after each such
dividend and distributed and properly designated by the Fund may be treated as
qualifying dividends. Corporate shareholders must meet the holding period
requirements stated above with respect to their shares of the Fund for each
dividend in order to qualify for the deduction and, if they have any debt that
is deemed under the Code directly attributable to such shares, may be denied a
portion of the dividends received deduction. The entire qualifying dividend,
including the otherwise deductible amount, will be included in determining the
excess (if any) of a corporate shareholder's adjusted current earnings over its
alternative minimum taxable income, which may increase its alternative minimum
tax liability. Additionally, any corporate shareholder should consult its tax
adviser regarding the possibility that its basis in its shares may be reduced,
for Federal income tax purposes, by reason of "extraordinary dividends" received
with respect to the shares, and, to the extend such basis would be reduced below
zero, that current recognition of income would be required.

The Fund is required to accrue income on any debt securities that have more than
a de minimis amount of original issue discount (or debt securities acquired at a
market discount, if the Fund elects to include market discount in income
currently) prior to the receipt of the corresponding cash payments. The mark to
market or constructive sale rules applicable to certain options, futures,
forwards, short sales or other transactions may also require the Fund to
recognize income or gain without a concurrent receipt of cash. Additionally,
some countries restrict repatriation which may make it difficult or impossible
for the Fund to obtain cash corresponding to its earnings or assets in those
countries. However, the Fund must distribute to shareholders for each taxable
year substantially all of its net income and net capital gains, including such
income or gain, to qualify as a regulated investment company and avoid liability
for any federal income or

excise tax. Therefore, the Fund may have to dispose of its portfolio securities
under disadvantageous circumstances to generate cash, or may borrow cash, to
satisfy these distribution requirements.

A state income (and possibly local income and/or intangible property) tax
exemption is generally available to the extent (if any) the Fund's distributions
are derived from interest on (or, in the case of intangible property taxes, the
value of its assets is attributable to) certain U.S. Government obligations,
provided in some states that certain thresholds for holdings of such obligations
and/or reporting requirements are satisfied. The Fund will not seek to satisfy
any threshold or reporting requirements that may apply in particular taxing
jurisdictions, although it may in its sole discretion provide relevant
information to shareholders.

The Fund will be required to report to the Internal Revenue Service (the "IRS")
all taxable distributions to shareholders, as well as gross proceeds from the
redemption or exchange of Fund shares, except in the case of certain exempt
recipients, i.e., corporations and certain other investors distributions to
which are exempt from the information reporting provisions of the Code. Under
the backup withholding provisions of Code Section 3406 and applicable Treasury
regulations, all such reportable distributions and proceeds may be subject to
backup withholding of federal income tax in the case of non-exempt shareholders
who fail to furnish the Fund with their correct taxpayer identification number
and certain certifications required by the IRS or if the IRS or a broker
notifies the Fund that the number furnished by the shareholder is incorrect or
that the shareholder is subject to backup withholding as a result of failure to
report interest or dividend income. The Fund may refuse to accept an application
that does not contain any required taxpayer identification number nor
certification that the number provided is correct. If the backup withholding
provisions are applicable, any such distributions and proceeds, whether taken in
cash or reinvested in shares, will be reduced by the amounts required to be
withheld. Any amounts withheld may be credited against a shareholder's U.S.
federal income tax liability. Investors should consult their tax advisers about
the applicability of the backup withholding provisions.

Different tax treatment, including penalties on certain excess contributions and
deferrals, certain pre-retirement and post-retirement distributions and certain
prohibited transactions, is accorded to accounts maintained as qualified
retirement plans. Shareholders should consult their tax advisers for more
information.

The foregoing discussion relates solely to Federal income tax law as applicable
to U.S. persons (i.e., U.S. citizens and residents and U.S. domestic
corporations, partnerships, trusts or estates) subject to tax under such law.
The discussion does not address special tax rules applicable to certain types of
investors, such as tax-exempt entities, insurance companies and financial
institutions. Dividends, capital gain distributions and ownership of or gains
realized on the redemption (including an exchange) of shares of the Fund may
also be subject to state and local taxes. Shareholders should consult their own
tax advisers as to the Federal, state or local tax consequences of ownership of
shares of, and receipt of distributions from, the Fund in their particular
circumstances.

Non-U.S. investors not engaged in a U.S. trade or business with which their
investment in the Fund is effectively connected will be subject to U.S. Federal
income tax treatment that is different from that described above. These
investors may be subject to non-resident alien withholding tax at the rate of
30% (or a lower rate under an applicable tax treaty) on amounts treated as
ordinary dividends from the Fund and, unless an effective IRS Form W-8, W-8BEN
or other authorized withholding certificate is on file and to backup withholding
on certain other payments from the Fund. Non-U.S. investors should consult their
tax advisers regarding such treatment and the application of foreign taxes to an
investment in the Fund.

The Fund is not subject to Massachusetts corporate excise or franchise taxes.
The Fund anticipates that, provided that the Fund qualifies as a regulated
investment company under the Code, it will also not be required to pay any
Massachusetts income tax.

CALCULATION OF PERFORMANCE

The average annual total return before taxes is computed by finding the average
annual compounded rates of return over the 1-year, 5-year and 10-year periods,
or the period since the commencement of operations, that would equate the
initial amount invested to the ending redeemable value according to the
following formula:

P(1+T)^n = ERV

Where:
P = a hypothetical initial payment of $1,000.
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000 payment
made at the beginning of the 1-year, 5-year or 10-year
periods (or fractional portion).

The Fund discloses average annual total returns after taxes for Class A shares
for the one, five and 10 year periods, or the period since commencement of
operations, ended December 31, 2001 in the prospectus. After tax returns are
computed using the historical highest individual federal marginal income-tax
rates and do not reflect the impact of state and local taxes. Actual after-tax
returns depend on the investor's tax situation and may differ from those shown.
The after-tax returns shown are not relevant to investors who hold their fund
shares through tax-deferred arrangements such as 401(k) plans or individual
retirement accounts.

The average annual total return (after taxes on distributions) is computed by
finding the average annual compounded rate of return over the 1-year, 5-year and
10-year periods, or the period since the commencement of operations, that would
equate the initial amount invested to the ending redeemable value according to
the following formula:

P(1+T)^n = ATV(D)

Where:
P= a hypothetical initial payment of $1,000.
T= average annual total return (after taxes on distributions)
n= number of years
ATV(D)= ending value of a hypothetical $1,000 payment made at
the beginning of the 1-year, 5-year, or 10-year periods
(or fractional portion) after taxes on fund
distributions but not after taxes on redemption.

The average annual total return (after taxes on distributions and redemption) is
computed by finding the average annual compounded rate of return over the
1-year, 5-year and 10-year periods, or the period since the commencement of
operations, that would equate the initial amount invested to the ending
redeemable value according to the following formula:

P(1+T)^n = ATV(DR)

Where:
P= a hypothetical initial payment of $1,000.
T= average annual total return (after taxes on distributions and
redemption)
n= number of years
ATV(DR)= ending value of a hypothetical $1,000 payment made at
the beginning of the 1-year, 5-year or 10-year periods
(or fractional portion), after taxes on fund distributions
and redemption.

Because each class has its own sales charge and fee structure, the classes have
different performance results. In the case of each class, these calculations
assume the maximum sales charge is included in the initial investment or the
CDSC is applied at the end of the period. These calculations assume that all
dividends and distributions are reinvested at net asset value on the
reinvestment dates during the period. The "distribution rate" is determined by
annualizing the result of dividing the declared dividends of the Fund during the
period stated by the maximum offering price or net asset value at the end of the
period. Excluding the Fund's sales charge from the distribution rate produces a
higher rate.

In addition to average annual total returns, the Fund may quote unaveraged or
cumulative total returns reflecting the simple change in value of an investment
over a stated period. Cumulative total returns may be quoted as a percentage or
as a dollar amount, and may be calculated for a single investment, a series of
investments and/or a series of redemptions over any time period. Total returns
may be quoted with or without taking the Fund's sales charge on Class A or Class
C shares or the CDSC on Class B or Class C shares into account. Excluding the
Fund's sales charge on Class A and Class C shares and the CDSC on Class B or
Class C shares from a total return calculation produces a higher total return
figure.

The Fund may advertise yield, where appropriate. The Fund's yield is computed by
dividing net investment income per share determined for a 30-day period by the
maximum offering price per share (which includes the full sales charge) on the
last day of the period, according to the following standard formula:

Yield = 2 ( [ ( a-b/cd ) + 1 ] ^6 - 1)

Where:

a = dividends and interest earned during the period.
b = net expenses accrued during the period.
c = the average daily number of fund shares outstanding during the
period that would be entitled to receive dividends.
d = the maximum offering price per share on the last day of the period
(NAV where applicable).

From time to time, in reports and promotional literature, the Fund's total
return will be compared to indices of mutual funds such as Lipper Analytical
Services, Inc.'s "Lipper - Mutual Fund Performance Analysis," a monthly
publication which tracks net assets, total return and yield on mutual funds in
the United States. Ibottson and Associates, CDA Weisenberger and F.C. Towers are
also used for comparison purposes, as well as the Russell and Wilshire Indices.

Performance rankings and ratings reported periodically in, and excerpts from,
national financial publications such as MONEY Magazine, FORBES, BUSINESS WEEK,
THE WALL STREET JOURNAL, MICROPAL, INC., MORNINGSTAR, STANGER'S and BARRON'S may
also be utilized. The Fund's promotional and sales literature may make reference
to the Fund's "beta". Beta is a reflection of the market related risk of the
Fund by showing how responsive the Fund is to the market.

The performance of the Fund is not fixed or guaranteed. Performance quotations
should not be considered to be representations of performance of the Fund for
any period in the future. The performance of the Fund is a function of many
factors including its earnings, expenses and number of outstanding shares.
Fluctuating market conditions; purchases, sales and maturities of portfolio
securities; sales and redemptions of shares of beneficial interest; and changes
in operating expenses are all examples of items that can increase or decrease
the Fund's performance.

BROKERAGE ALLOCATION

The Subadvisor is required to effect all transactions in portfolio securities
through the Adviser's trading desk. Decisions concerning the purchase and sale
of portfolio securities and the allocation of brokerage commissions are made by
the Adviser pursuant to recommendations made by an investment committee of the
Adviser, which consists of officers and directors of the Adviser and affiliates
and officers and Trustees who are interested persons of the Fund. Orders for
purchases and sales of securities are placed in a manner which, in the opinion
of the Adviser, will offer the best price and market for the execution of each
such transaction. Purchases from underwriters of portfolio securities may
include a commission or commissions paid by the issuer, and transactions with
dealers serving as market makers reflect a "spread". Debt securities are
generally traded on a net basis through dealers acting for their own account as
principals and not as brokers; no brokerage commissions are payable on these
transactions.

In the U.S. Government securities market, securities are generally traded on a
"net" basis with dealers acting as principal for their own account without a
stated commission, although the price of the security usually includes a profit
to the dealer. On occasion, certain money market instruments and agency
securities may be purchased directly from the issuer, in which case no
commissions or premiums are paid. In other countries, both debt and equity
securities are traded on exchanges at fixed commission rates. Commissions on
foreign transactions are generally higher than the negotiated commission rates
available in the U.S. There is generally less government supervision and
regulation of foreign stock exchanges and broker-dealers than in the U.S.

The Fund's primary policy is to execute all purchases and sales of portfolio
instruments at the most favorable prices consistent with best execution,
considering all of the costs of the transaction including brokerage commissions.
This policy governs the selection of brokers and dealers and the market in which
a transaction is executed. Consistent with the foregoing primary policy, the
Conduct Rules of the National Association of Securities Dealers, Inc. and such
other policies as the Trustees may determine, the Adviser may consider sales of
shares of the Fund as a factor in the selection of broker-dealers to execute the
Fund's portfolio transactions.

To the extent consistent with the foregoing, the Fund will be governed in the
selection of brokers and dealers, and the negotiation of brokerage commission
rates and dealer spreads, by the reliability and quality of the services,
including primarily the availability and value of research information and, to a
lesser extent, statistical assistance furnished to the Adviser of the Fund and
their value and expected contribution to the performance of the Fund. It is not
possible to place a dollar value on information and services to be received from
brokers and dealers, since it is only supplementary to the research efforts of
the Adviser. The receipt of research information is not expected to reduce
significantly the expenses of the Adviser. The research information and

statistical assistance furnished by brokers and dealers may benefit the Life
Insurance Company or other advisory clients of the Adviser, and, conversely,
brokerage commissions and spreads paid by other advisory clients of the Adviser
may result in research information and statistical assistance beneficial to the
Fund. The Fund will not make commitments to allocate portfolio transactions upon
any prescribed basis. While the Adviser's officers will be primarily responsible
for the allocation of the Fund's brokerage business, their policies and
practices in this regard must be consistent with the foregoing and will at all
times be subject to review by the Trustees.

As permitted by Section 28(e) of the Securities Exchange Act of 1934, the Fund
may pay a broker which provides brokerage and research services to the Fund an
amount of disclosed commission in excess of the commission which another broker
would have charged for effecting that transaction. This practice is subject to a
good faith determination by the Trustees that such commission is reasonable in
light of the services provided and to such policies as the Trustees may adopt
from time to time.

The Adviser's indirect parent, the Life Company, is the indirect sole
shareholder of Signator Investors, Inc., a broker-dealer (until January 1, 1999,
John Hancock Distributors, Inc.) "Signator" or "Affiliated Broker"). Pursuant to
procedures determined by the Trustees and consistent with the above policy of
obtaining best net results, the Fund may execute portfolio transactions with or
through Affiliated Brokers.

Signator may act as broker for the Fund on exchange transactions, subject,
however, to the general policy of the Fund set forth above and the procedures
adopted by the Trustees pursuant to the Investment Company Act. Commissions paid
to an Affiliated Broker must be at least as favorable as those which the
Trustees believe to be contemporaneously charged by other brokers in connection
with comparable transactions involving similar securities being purchased or
sold. A transaction would not be placed with an Affiliated Broker if the Fund
would have to pay a commission rate less favorable than the Affiliated Broker's
contemporaneous charges for comparable transactions for its other most favored,
but unaffiliated, customers, except for accounts for which the Affiliated Broker
acts as clearing broker for another brokerage firm, and any customers of the
Affiliated Broker not comparable to the Fund as determined by a majority of the
Trustees who are not "interested persons" (as defined in the Investment Company
Act) of the Fund, the Adviser or the Affiliated Broker. Because the Adviser,
which is affiliated with the Affiliated Broker, has, as an investment adviser to
the Fund, the obligation to provide investment management services, which
include elements of research and related investment skills, such research and
related skills will not be used by the Affiliated Broker as a basis for
negotiating commissions at a rate higher than that determined in accordance with
the above criteria.

Other investment advisory clients advised by the Adviser may also invest in the
same securities as the Fund. When these clients buy or sell the same securities
at substantially the same time, the Adviser may average the transactions as to
price and allocate the amount of available investments in a manner which the
Adviser believes to be equitable to each client, including the Fund. Because of
this, client accounts in a particular style may sometimes not sell or acquire
securities as quickly or at the same prices as they might if each were managed
and traded individually.

For purchases of equity securities, when a complete order is not filled, a
partial allocation will be made to each account pro rata based on the order
size. For high demand issues (for example, initial public offerings), shares
will be allocated pro rata by account size as well as on the basis of account
objective, account size ( a small account's allocation may be increased to
provide it with a meaningful position), and the account's other holdings. In
addition, an account's allocation may be increased if that account's portfolio
manager was responsible for generating the investment idea or the portfolio
manager intends to buy more shares in the secondary market.

For fixed income accounts, generally securities will be allocated when
appropriate among accounts based on account size, except if the accounts have
different objectives or if an account is too small to get a meaningful
allocation. For new issues, when a complete order is not filled, a partial
allocation will be made to each account pro rata based on the order size.
However, if a partial allocation is too small to be meaningful, it may be
reallocated based on such factors as account objectives, strategies, duration
benchmarks and credit and sector exposure. For example, value funds will likely
not participate in initial public offerings as frequently as growth funds. In
some instances, this investment procedure may adversely affect the price paid or
received by the Fund or the size of the position obtainable for it. On the other
hand, to the extent permitted by law, the Adviser may aggregate securities to be
sold or purchased for the Fund with those to be sold or purchased for other
clients managed by it in order to obtain best execution.

TRANSFER AGENT SERVICES

John Hancock Signature Services, Inc., 1 John Hancock Way, Suite 1000, Boston,
MA 02217-1000, a wholly owned indirect subsidiary of the Life Company, is the
transfer and dividend paying agent for the Fund. The Fund pays Signature
Services an annual fee of $20.00 for each Class A shareholder account and $22.50
for each Class B shareholder account and $21.50 for each Class C shareholder
account. For Class A, B and C shares, the Fund also pays certain out-of-pocket
expenses. These expenses are charged to the Fund by account, aggregated and
allocated to each class on the basis of their relative net asset values. The
Fund pays Signature Services an annual fee of 0.05% of average daily net assets
attributable to Class I shares plus certain out-of-pocket expenses

CUSTODY OF PORTFOLIO

Portfolio securities of the Fund are held pursuant to a custodian agreement
between the Fund and The Bank of New York, One Wall Street, New York, New York
10286. Under the custodian agreement, The Bank of New York. is performing
custody, Foreign Custody Manager and fund accounting services.

INDEPENDENT AUDITORS

U.S Global Leaders Growth Fund's audited financial statements for the fiscal
years ended June 30, 2001 (filed electronically on September 5, 2001 accession
number 000090912-01-500351) and unaudited financial statements for the six
months ended December 31, 2001 (filed electronically on ___, 2002, accession
number ___) are included in and incorporated by reference into Part B of this
Registration Statement (file no. 811-05037 and 33-12213). The June 30, 2001
financial statements, including the financial highlights in the fund's Class A,
Class B and Class C shares prospectus, have been audited by Ernst & Young,
independent accountants, as indicated in their report with respect to those
financial statements and are included in reliance upon the authority of Ernst &
Young LLP as experts in accounting and auditing in giving their report.

APPENDIX A - MORE ABOUT RISK

A fund's risk profile is largely defined by the fund's primary securities and
investment practices. You may find the most concise description of the fund's
risk profile in the prospectus.

A fund is permitted to utilize -- within limits established by the trustees --
certain other securities and investment practices that have higher risks and
opportunities associated with them. To the extent that the Fund utilizes these
securities or practices, its overall performance may be affected, either
positively or negatively. On the following pages are brief definitions of
certain associated risks with them with examples of related securities and
investment practices included in brackets. See the "Investment Objective and
Policies" and "Investment Restrictions" sections of this Statement of Additional
Information for a description of this Fund's investment policies. The Fund
follows certain policies that may reduce these risks.

As with any mutual fund, there is no guarantee that the Fund will earn income or
show a positive return over any period of time -- days, months or years.

TYPES OF INVESTMENT RISK

Correlation risk The risk that changes in the value of a hedging instrument will
not match those of the asset being hedged (hedging is the use of one investment
to offset the effects of another investment). Incomplete correlation can result
in unanticipated risks. (e.g., short sales, financial futures and options;
securities and index options, currency contracts).

Credit risk The risk that the issuer of a security, or the counterparty to a
contract, will default or otherwise become unable to honor a financial
obligation. (e.g., borrowing; reverse repurchase agreements, repurchase
agreements, securities lending, non-investment-grade securities, financial
futures and options; securities and index options).

Currency risk The risk that fluctuations in the exchange rates between the U.S.
dollar and foreign currencies may negatively affect an investment. Adverse
changes in exchange rates may erode or reverse any gains produced by foreign
currency denominated investments and may widen any losses. (e.g., foreign
equities, financial futures and options; securities and index options, currency
contracts).

Information risk The risk that key information about a security or market is
inaccurate or unavailable. (e.g., non-investment-grade securities, foreign
equities).

Interest rate risk The risk of market losses attributable to changes in interest
rates. With fixed-rate securities, a rise in interest rates typically causes a
fall in values, while a fall in rates typically causes a rise in values. (e.g.,
non-investment-grade securities, financial futures and options; securities and
index options).

Leverage risk Associated with securities or practices (such as borrowing) that
multiply small index or market movements into large changes in value. (e.g.,
borrowing; reverse repurchase agreements, when-issued securities and forward
commitments).

o Hedged When a derivative (a security whose value is based on another
security or index) is used as a hedge against an opposite position that
the fund also holds, any loss generated by the derivative

A-1

should be substantially offset by gains on the hedged investment, and vice
versa. While hedging can reduce or eliminate losses, it can also reduce or
eliminate gains. (e.g., short sales, financial futures and options
securities and index options; currency contracts).

o Speculative To the extent that a derivative is not used as a hedge, the
fund is directly exposed to the risks of that derivative. Gains or losses
from speculative positions in a derivative may be substantially greater
than the derivative's original cost. (e.g., short sales, financial futures
and options securities and index options; currency contracts).

o Liquidity risk The risk that certain securities may be difficult or
impossible to sell at the time and the price that the seller would like.
The seller may have to lower the price, sell other securities instead or
forego an investment opportunity, any of which could have a negative
effect on fund management or performance. (e.g., non-investment-grand
securities, short sales, restricted and illiquid securities, financial
futures and options securities and index options; currency contracts).

Management risk The risk that a strategy used by a fund's management may fail to
produce the intended result. Common to all mutual funds.

Market risk The risk that the market value of a security may move up and down,
sometimes rapidly and unpredictably. These fluctuations may cause a security to
be worth less than the price originally paid for it, or less than it was worth
at an earlier time. Market risk may affect a single issuer, industry, sector of
the economy or the market as a whole. Common to all stocks and bonds and the
mutual funds that invest in them. (e.g., short sales, short-term trading,
when-issued securities and forward commitments, non-investment-grade securities,
foreign equities, financial futures and options; securities and index options
restricted and illiquid securities).

Natural event risk The risk of losses attributable to natural disasters, crop
failures and similar events. (e.g., foreign equities).

Opportunity risk The risk of missing out on an investment opportunity because
the assets necessary to take advantage of it are tied up in less advantageous
investments. (e.g., short sales, when-issued securities and forward commitments;
financial futures and options; securities and index options, currency
contracts).

Political risk The risk of losses attributable to government or political
actions, from changes in tax or trade statutes to governmental collapse and
war.(e.g., foreign equities).

Valuation risk The risk that a fund has valued certain of its securities at a
higher price than it can sell them for. (e.g., non-investment-grade securities,
restricted and illiquid securities).

A-2

APPENDIX B

Description of Bond Ratings

The ratings of Moody's Investors Service, Inc. and Standard & Poor's Ratings
Group represent their opinions as to the quality of various debt instruments
they undertake to rate. It should be emphasized that ratings are not absolute
standards of quality. Consequently, debt instruments with the same maturity,
coupon and rating may have different yields while debt instruments of the same
maturity and coupon with different ratings may have the same yield.

MOODY'S INVESTORS SERVICE, INC.

Aaa: Bonds which are rated Aaa are judged to be of the best quality. They carry
the smallest degree of investment risk and are generally referred to as "gilt
edge." Interest payments are protected by a large or by an exceptionally stable
margin and principal is secure. While the various protective elements are likely
to change, such changes as can be visualized are most unlikely to impair the
fundamentally strong position of such issues.

Aa: Bonds which are rated Aa are judged to be of high quality by all standards.
Together with the Aaa group they comprise what are generally known as high grade
bonds. They are rated lower than the best bonds because margins of protection
may not be as large as in Aaa securities or fluctuations of protective elements
may be of greater amplitude or there may be other elements present which make
the long-term risks appear somewhat larger than in Aaa securities.

A: Bonds which are rated A possess many favorable investment attributes and are
to be considered as upper medium grade obligations. Factors giving security to
principal and interest are considered adequate but elements may be present which
suggest a susceptibility to impairment at some time in the future.

Baa: Bonds which are rated Baa are considered as medium grade obligations, i.e.,
they are neither highly protected nor poorly secured. Interest payments and
principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time. Such bonds lack outstanding investment characteristics and in
fact have speculative characteristics as well.

Ba: Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of interest
and principal payments may be very moderate and thereby not well safeguarded
during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.

B: Bonds which are rated B generally lack the characteristics of desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.

Bonds which are rated Caa are of poor standing. Such issues may be in default or
there may be present elements of danger with respect to principal or interest.

Bonds which are rated Ca represented obligations which are speculative in a high
degree. Such issues are often in default or have other marked shortcomings.

B-1

STANDARD & POOR'S RATINGS GROUP

AAA: Debt rated AAA has the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA: Debt rated AA has a very strong capacity to pay interest and repay principal
and differs from the highest rated issues only in small degree.

A: Debt rated A has a strong capacity to pay interest and repay principal,
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories.

BBB: Debt rated BBB is regarded as having an adequate capacity to pay interest
and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher rated categories.

BB, B: Debt rated BB, and B is regarded, on balance, as predominantly
speculative with respect to capacity to pay interest and repay principal in
accordance with the terms of the obligation. BB indicates the lowest degree of
speculation and CC the highest degree of speculation. While such debt will
likely have some quality and protective characteristics, these are outweighed by
large uncertainties or major risk exposures to adverse conditions.

CCC Debt rated 'CCC' has a currently identifiable vulnerability to default, and
is dependent upon favorable business, financial, and economic conditions to meet
timely payment of interest and repayment of principal. In the event of adverse
business, financial or economic conditions, it is not likely to have the
capacity to pay interest and repay principal. The 'CCC' rating category is also
used for debt subordinated to senior debt that is assigned an actual or implied
'B' or 'B-' rating.

CC The rating 'CC' is typically applied to debt subordinated to senior debt that
is assigned an actual or implied 'CCC' rating.

B-2

FINANCIAL STATEMENTS

F-1

Supplement dated March 4, 2002 to Prospectus dated October 29, 2001

U.S. Global Leaders Growth Fund

The Board of Trustees of Professionally Managed Portfolios (the
"Trust") has approved the reorganization of U.S. Global Leaders Growth Fund (the
"Fund"), a series of the Trust, into John Hancock U.S. Global Leaders Growth
Fund (the "John Hancock Fund"), a newly organized fund within the John Hancock
Capital Series. Pursuant to the reorganization, the Fund would transfer all of
its assets to the John Hancock Fund in exchange for Class A shares of the John
Hancock Fund and the assumption by the John Hancock Fund certain liabilities.
The John Hancock Fund will not commence investment operations until the closing
of the reorganization. As of the close of the reorganization, it is expected
that shareholders of the Fund will hold the same number of shares of the John
Hancock Fund as they held in the Fund immediately before the reorganization and
that the aggregate net asset value of such shares as of the reorganization date
will not be effected by the reorganization. Shareholders will not be subject to
any sales charges as a result of the reorganization and should not experience
any adverse tax consequences.

Yeager, Wood & Marshall, Inc., the investment adviser to the Fund, will
be the sub-adviser to the John Hancock Fund and be responsible for day to day
management of the John Hancock Fund's assets. John Hancock Advisers, LLC will be
the John Hancock Fund's investment adviser and has agreed to limit the John
Hancock Fund's total operating expenses for the Class A shares for at least the
next two years to 1.37 % of average daily net assets. So, the total operating
expenses of the John Hancock Fund's Class A shares will not be higher than, and
may be lower than, your fund's historical operating expenses. The Fund and the
John Hancock Fund have the same investment objectives and policies.

Completion of the reorganization is subject to a number of
conditions, including the approval by the Fund's shareholders. The Trustees have
established March 20, 2002 as the record date for the shareholders meeting to
consider the reorganization. Shareholders of record on that date will receive a
proxy statement/prospectus that will contain more information regarding the
reorganization. Shareholders should read the proxy statement/prospectus
carefully before determining whether to approve the reorganization.

The reorganization is expected to close in May 2002.

U.S. GLOBAL LEADERS GROWTH FUND
series of Professionally Managed Portfolios

Supplement dated August 10, 2001
to Prospectus dated October 27, 2000

Effective August 13, 2001, American Data Services, Inc. will be relocating the
Transfer Agency operations to Omaha, Nebraska. Fund operations will not be
affected in any way. However, all correspondence, purchases by check and written
redemption requests should be mailed to the address noted below.

U.S. Global Leaders Growth Fund
c/o American Data Services, Inc.
Post Office Box 542007
Omaha, NE 68154-1952

The Transfer Agent's toll-free telephone number is 1-800-282-2340.

Payments by wire transfer should be forwarded to the address noted below:

First National Bank of Omaha
Omaha, NE
ABA# 104000016
U.S. Global Leaders Growth Fund
DDA Account# 22669607
Account name (shareholder name)
Shareholder account number

US
GLOBAL
LEADERS
----------
GROWTH
FUND

----------

PROSPECTUS

OCTOBER 29, 2001

----------

THE SECURITIES AND EXCHANGE COMMISSION
HAS NOT APPROVED OR DISAPPROVED THESE
SECURITIES OR PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.

U.S. GLOBAL LEADERS GROWTH FUND
A SERIES OF PROFESSIONALLY MANAGED PORTFOLIOS

TABLE OF CONTENTS

An Overview of the Fund 2

Performance 4

Fees and Expenses 5

Objective and Investment Approach of the Fund 7

Principal Risks of Investing in the Fund 8

Advisor's Discussion of Fund Performance 9

Investment Advisor 10

Portfolio Managers 10

Shareholder Information 11

Pricing of Fund Shares 15

Dividends and Distributions 16

Tax Consequences 16

Financial Highlights 17

Privacy Notice 18

AN OVERVIEW OF THE FUND

WHAT IS THE FUND'S INVESTMENT GOAL?

The Fund seeks long-term growth of capital.

WHAT ARE THE FUND'S PRINCIPAL INVESTMENT STRATEGIES?

The Fund seeks to achieve its goal through investment in sustainable growth
companies with a global reach. The Fund primarily invests in common stocks of
U.S. companies that have substantial international activities ("U.S. Global
Leaders"). The Advisor considers U.S. companies that have leading positions in
growing markets in developed countries and also derive (or have potential to do
so) a substantial portion of their profits in fast-growing emerging markets as
U.S. Global Leaders. The Advisor considers U.S. Global Leaders companies
typically to possess the following sustainable growth qualities:

* Hold leading market shares of their relevant growth markets, and hence
possess the pricing flexibility that results in high profit margins and
high investment returns.

* Supply consumable products or services so that their revenue streams are
recurring rather than derived from infrequent or postponable sales of
big-ticket items.

Unlike mutual funds that are classified as "global" funds, the Fund does not
have a principal investment policy that calls for foreign investing.

The Fund is non-diversified. This means that with respect to 50% of its assets,
it may make larger investments in individual companies than a fund that is
diversified. However, with respect to the other 50% of its assets, the Fund may
only invest up to 5% of its assets in any individual security.

WHAT ARE THE PRINCIPAL RISKS OF INVESTING IN THE FUND?

There is the risk that you could lose money on your investment in the Fund. The
following risks could affect the value of your investment:

* The stock market goes down

* Interest rates rise which can result in a decline in the equity market

* Growth stocks fall out of favor with the stock market

* Stocks in the Fund's portfolio may not increase their earnings at the rate
anticipated

* Because the Fund has the ability to take larger positions in a small number
of issuers, the Fund's share price may be more volatile than the share
price of a diversified fund.

AN INVESTMENT IN THE FUND IS NOT A DEPOSIT OF THE BANK AND IS NOT INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENT
AGENCY.

WHO MAY WANT TO INVEST IN THE FUND?

The Fund may be appropriate for investors who:

* Are pursuing a long-term goal such as retirement

* Want to add an investment with growth potential to diversify their
investment portfolio

* Are willing to accept higher short-term risk

The Fund may not be appropriate for investors who:

* Need regular income or stability of principal

* Are pursuing a short-term goal

PERFORMANCE

The following performance information indicates some of the risks of
investing in the Fund. The bar chart shows how the Fund's total return has
varied from year to year. The table shows the Fund's average annual total return
over time compared with a broad-based market index. This past performance will
not necessarily continue in the future.

[Bar chart]

1996 1997 1998 1999 2000
---- ---- ---- ---- ----
23.14% 40.46% 31.98% 7.88% 4.15%

CALENDAR YEAR TOTAL RETURNS*

The Fund's year-to-date return as of 9/30/01 was -16.36%

* During the period shown in the bar chart, the Fund's highest quarterly return
was 29.43% for the quarter ended December 31, 1998 and the lowest quarterly
return was -16.69% for the quarter ended September 30, 1998.

AVERAGE ANNUAL TOTAL RETURNS AS OF DECEMBER 31, 2000

Since
Inception
1 Year 5 Years (9/29/95)
------ ------- ---------
U.S. Global Leaders Growth Fund 4.15% 20.71% 21.10%
S&P 500 Index* -9.10% 18.33% 18.65%

- ----------
* The S&P 500 Index is an unmanaged index generally representative of the
market for stocks of large sized U.S. companies.

FEES AND EXPENSES

This table describes the fees and expenses that you may pay if you buy and
hold shares of the Fund.

SHAREHOLDER FEES
(fees paid directly from your investment)

Maximum sales charge (load) imposed on purchases None

Maximum deferred sales charge (load) None

Redemption fee (as a percentage of amount redeemed)* 2.00%

ANNUAL FUND OPERATING EXPENSES
(expenses that are deducted from Fund assets)

Advisory Fee 1.00%

Other Expenses 0.38%

Total Annual Fund Operating Expenses 1.38%

- ----------
* The redemption fee applies to those shares that you have held for less than
six months. The fee is payable to the Fund and is intended to benefit the
remaining shareholders by reducing the costs of short-term trading.

EXAMPLE

This Example is intended to help you compare the cost of investing in the Fund
with the cost of investing in other mutual funds.

The Example assumes that you invest $10,000 in the Fund for the time periods
indicated and then redeem all of your shares at the end of those periods. The
Example also assumes that your investment has a 5% return each year, that
dividends and distributions are reinvested and that the Fund's operating
expenses remain the same. Although your actual costs may be higher or lower,
under the assumptions, your costs would be:

One Year $ 140

Three Years $ 437

Five Years $ 755

Ten Years $ 1,657

OBJECTIVE AND INVESTMENT APPROACH OF THE FUND

The goal of the U.S. Global Leaders Growth Fund is to seek long-term growth of
capital through its investment in sustainable growth companies with a global
reach.

The Fund invests primarily in common stocks of United States companies that have
substantial international activities ("U.S. Global Leaders"). Under normal
market conditions, at least 65% of the Fund's total assets will be invested in
stocks of companies the Advisor regards as U.S. Global Leaders. U.S. Global
Leaders companies typically exhibit these key sustainable growth
characteristics:

* Hold leading market shares of their relevant growth markets, and hence
possess the pricing flexibility that results in high profit margins and
high investment returns.

* Supply consumable products or services so that their revenue streams are
recurring rather than derived from infrequent or postponable sales of
big-ticket items.

The Advisor believes that companies with these characteristics should have
relatively low business risk and relatively high sustainability of earnings
growth.

The Advisor believes that leading multi-national companies traded publicly in
U.S. securities markets have a number of advantages that make them attractive
investments. U.S. capital markets are large and liquid. Accounting practices are
consistent and well regulated. Currency and political risks are minimized, and
the costs associated with investing abroad are reduced.

Companies that have leading positions in growing markets in the U.S. and other
developed countries and also derive a significant portion of their profits in
fast-growing emerging markets are relatively limited in number at this time.
Because of the difficulty and expense in building broad-based distribution in
newer global markets, it appears likely that the number of such companies will
not expand rapidly. Thus, the Advisor believes that the stocks of multi-national
companies that can sustain superior global earnings growth are likely to be
accorded premium relative valuations.

The Advisor's investment policy is to identify U.S. Global Leaders companies
with superior long-term earnings prospects and to continue to own them as long
as their managements are fulfilling their mission. As long as the Advisor
believes that shares of such companies continue to enjoy favorable prospects for
capital growth and that they are not overvalued in the marketplace, such shares
are ordinarily retained.

The Fund anticipates that its portfolio turnover rate will not normally exceed
25%. This means that the Fund has the potential to be a tax efficient
investment. This should result in the realization and distribution to
shareholders of lower capital gains, which would be considered tax efficient.
This anticipated lack of frequent trading can also lead to lower transaction
costs, which could help to improve the Fund's performance.

Under normal market conditions, the Fund will stay fully invested in stocks.
However, the Fund may temporarily depart from its principal investment
strategies by making short-term investments in cash equivalents in response to
adverse market, economic or political conditions. This may result in the Fund
not achieving its investment objective.

PRINCIPAL RISKS OF INVESTING IN THE FUND

The principal risks of investing in the Fund that may adversely affect the
Fund's net asset value or total return have previously been summarized under "An
Overview of the Fund." These risks are discussed in more detail below.

MANAGEMENT RISK. Management risk means that your investment in the Fund varies
with the success or failure of the Advisor's investment strategies and the
Advisor's research, analysis and determination of portfolio securities. If the
Advisor's investment strategies do not produce the expected results, your
investment could be diminished or even lost.

MARKET RISK. Market risk means that the price of common stocks may move up or
down (sometimes rapidly and unpredictably) in response to general market and
economic conditions, investor perception and anticipated events, as well as the
activities of the particular issuer. Market risk may affect a single issuer,
industry, section of the economy or the market as a whole. Since the Fund
invests in equity securities, its share price will change daily in response to
stock market movements.

ADVISOR'S DISCUSSION OF FUND PERFORMANCE

The Fund closed the fiscal year ended June 30, 2001 with a decline of 5.27%
compared to the S&P 500's drop of 14.85% during the same period. Since its
inception, the Fund has produced annualized returns of 17.46% for shareholders,
in excess of the 15.50% returns of the S&P 500. This past fiscal year has seen a
significant change in the U.S. economy. The unprecedented capital goods boom of
the late 1990s - particularly in the information technology sector - has given
way to a significant bust, the degree and duration of which is still unknown at
this juncture. In addition, the broader economy has been slowing from its recent
unsustainable pace. While the broader market has suffered as a result, the Fund
has been less impacted due to the nature of its investment approach. The Fund is
a concentrated portfolio of formidably competitive, SUSTAINABLE growth companies
with a global reach. These enterprises provide services or sell products that
are CONSUMED by millions of customers and need to be replaced, hence they are
expected to be far less impacted by economic slowdowns here and abroad than most
companies. The Advisor believes that they should be able to post earnings gains
collectively in 2001 and return to their long-term historical growth pattern in
the 15%-20% range once the economy recovers. In contrast, corporate profits in
the aggregate are likely to decline more than 20% this year. Furthermore, the
Fund has benefited from its lack of exposure to the technology sector, which has
been among the worst performing sectors in the market during the fiscal year.

INVESTMENT ADVISOR

Yeager, Wood & Marshall Incorporated is the Fund's investment advisor. The
Advisor is located at 630 Fifth Avenue, New York, NY 10111. The Advisor has been
providing investment advisory services since 1968 and is controlled by Mr.
George M. Yeager, President. The Advisor provides investment advisory services
to individual and institutional investors with assets under management of $345
million as of September 30, 2001.

The Advisor supervises the Fund's investment activities and determines which
securities are purchased and sold by the Fund. The Advisor also furnishes the
Fund with office space and certain administrative services and provides most of
the personnel needed by the Fund. For its services, the Fund pays the Advisor a
monthly management fee based upon its average daily net assets. For the fiscal
year ended June 30, 2001, the Advisor received advisory fees of 1.00% of the
Fund's average daily net assets.

PORTFOLIO MANAGERS

Mr. George M. Yeager, President of the Advisor, and Mr. George P. Fraise,
Executive Vice President of the Advisor, are responsible for the day-to-day
management of the Fund's portfolio. Mr. Yeager has been with the Advisor since
1968. Mr. Fraise joined the Advisor in early 2000 and is a member of its
Investment Policy Committee. Prior to joining the Advisor, Mr. Fraise was
associated with Scudder Kemper Investments where he was a co-manager for the
Scudder Large Company Growth Fund and a co-lead manager for the Kemper Growth
Fund.

SHAREHOLDER INFORMATION

HOW TO BUY SHARES

You may open a Fund account with $2,000 and add to your account at any time with
$1,000 or more. After you have opened your Fund account, you also may make
automatic subsequent monthly investments with $250 or more through the Automatic
Investment Plan. The minimum investment requirements may be waived from time to
time by the Fund.

You may purchase shares of the Fund by check or wire. All purchases by check
must be in U.S. dollars. Third party checks and cash will not be accepted. A
charge may be imposed if your check does not clear. The Fund does not issue
share certificates. The Fund reserves the right to reject any purchase in whole
or in part.

BY CHECK

If you are making an initial investment in the Fund, simply complete the Account
Application included with this Prospectus and mail it with a check (made payable
to "U.S. Global Leaders Growth Fund") to:

U.S. Global Leaders Growth Fund
c/o American Data Services, Inc.
P.O. Box 542007
Omaha, NE 68154-1952

If you wish to send your Account Application and check via an overnight delivery
service (such as FedEx), you should call the Transfer Agent at (800) 282-2340
for instructions.

If you are making a subsequent purchase, detach the stub that is attached to the
account statement you will receive after each transaction and mail it together
with a check made payable to "U.S. Global Leaders Growth Fund" to the Fund in
the envelope provided with your statement or to the address noted above. Your
account number should be written on the check. If you do not have the stub from
your account statement, include your name, address and account number on a
separate piece of paper.

BY WIRE

If you are making an initial investment in the Fund, before you wire funds you
should call the Transfer Agent at (800) 282-2340 between 9:00 a.m. and 4:00
p.m., Eastern time, on a day when the New York Stock Exchange ("NYSE") is open
for trading to advise them that you are making an investment by wire. The
Transfer Agent will ask for your name and the dollar amount you are investing.
You will then receive your account number and an order confirmation number. You
should then complete the Account Application included with this Prospectus.
Include the date and the order confirmation number on the Account Application
and mail the completed Account Application to the address at the top of the
Account Application. Your bank should transmit immediately available funds by
wire in your name to:

First National Bank of Omaha
Omaha, NE
ABA# 104000016
U.S. Global Leaders Growth Fund
DDA Account# 22669607
Account name (shareholder name)
Shareholder account number

If you are making a subsequent purchase, your bank should wire funds as
indicated above. Before each wire purchase, you should be sure to notify the
Transfer Agent. IT IS ESSENTIAL THAT YOUR BANK INCLUDE COMPLETE INFORMATION
ABOUT YOUR ACCOUNT IN ALL WIRE INSTRUCTIONS. If you have questions about how to
invest by wire, you may call the Transfer Agent. Your bank may charge you a fee
for sending a wire to the Fund.

You may buy and sell shares of the Fund through certain brokers (and their
agents) that have made arrangements with the Fund to sell its shares. When you
place your order with such a broker or its authorized agent, your order is
treated as if you had placed it directly with the Fund's Transfer Agent, and you
will pay or receive the next price calculated by the Fund. The broker (or agent)
holds your shares in an omnibus account in the broker's (or agent's) name, and
the broker (or agent) maintains your individual ownership records. The Advisor
may pay the broker (or its agent) for maintaining these records as well as
providing other shareholder services. The broker (or its agent) may charge you a
fee for handling your order. The broker (or agent) is responsible for processing
your order correctly and promptly, keeping you advised regarding the status of
your individual account, confirming your transactions and ensuring that you
receive copies of the Fund's prospectus.

BY PAYMENT IN KIND

In certain situations, Fund shares may be purchased by tendering payment in kind
in the form of shares of stock, bonds or other securities. Any securities used
to buy Fund shares must be readily marketable, their acquisition consistent with
the Fund's objective and otherwise acceptable to the Advisor.

AUTOMATIC INVESTMENT PLAN

For your convenience, the Fund offers an Automatic Investment Plan. Under this
Plan, after your initial investment, you authorize the Fund to withdraw from
your personal checking account each month an amount that you wish to invest,
which must be at least $250. If you wish to enroll in this Plan, complete the
appropriate section of the Account Application. The Fund may terminate or modify
this privilege at any time. You may terminate your participation in the Plan at
any time by notifying the Transfer Agent in writing.

RETIREMENT PLANS

The Fund offers an Individual Retirement Account ("IRA") plan. You may obtain
information about opening an IRA account by calling (800) 282-2340. If you wish
to open a Keogh, Section 403(b) or other retirement plan, please contact your
securities dealer.

HOW TO SELL SHARES

You may sell (redeem) your Fund shares on any day the Fund and the NYSE are open
for business.

You may redeem your shares by simply sending a written request to the Transfer
Agent. You should give your account number and state whether you want all or
some of your shares redeemed. The letter should be signed by all of the
shareholders whose names appear on the account registration. You should send
your redemption request to:

U.S. Global Leaders Growth Fund
c/o American Data Services, Inc.
P.O. Box 542007
Omaha, NE 68154-1952

To protect the Fund and its shareholders, a signature guarantee is required for
all written redemption requests. Signature(s) on the redemption request must be
guaranteed by an "eligible guarantor institution." These include banks,
broker-dealers, credit unions and savings institutions. A broker-dealer
guaranteeing signatures must be a

member of a clearing corporation or maintain net capital of at least $100,000.
Credit unions must be authorized to issue signature guarantees. Signature
guarantees will be accepted from any eligible guarantor institution which
participates in a signature guarantee program. A notary public is not an
acceptable guarantor.

If you complete the Redemption by Telephone portion of the Account Application,
you may redeem all or some of your shares by calling the Transfer Agent at (800)
282-2340 before the close of trading on the NYSE. This is normally 4:00 p.m.,
Eastern time. Redemption proceeds will be mailed on the next business day to the
address that appears on the Transfer Agent's records. If you request, redemption
proceeds will be wired on the next business day to the bank account you
designated on the Account Application. The minimum amount that may be wired is
$1,000. Wire charges, if any, will be deducted from your redemption proceeds.
Telephone redemptions cannot be made if you notify the Transfer Agent of a
change of address within 30 days before the redemption request. If you have a
retirement account, you may not redeem shares by telephone.

When you establish telephone privileges, you are authorizing the Fund and its
Transfer Agent to act upon the telephone instructions of the person or persons
you have designated on your Account Application. Redemption proceeds will be
transferred to the bank account you have designated on your Account Application.

Before executing an instruction received by telephone, the Fund and the Transfer
Agent will use reasonable procedures to confirm that the telephone instructions
are genuine. These procedures may include recording the telephone call and
asking the caller for a form of personal identification. If the Fund and the
Transfer Agent follow these procedures, they will not be liable for any loss,
expense, or cost arising out of any telephone redemption request that is
reasonably believed to be genuine. This includes any fraudulent or unauthorized
request. The Fund may change, modify or terminate these privileges at any time
upon at least 60 days' notice to shareholders.

You may request telephone redemption privileges after your account is opened by
calling the Transfer Agent at (800) 282-2340 for instructions. You may have
difficulties in making a telephone redemption during periods of abnormal market
activity. If this occurs, you may make your redemption request in writing.

Payment of your redemption proceeds will be made promptly, but not later than
seven days after the receipt of your written request in proper form as discussed
in this Prospectus. If you made your initial

investment by wire, payment of your redemption proceeds for those shares will
not be made until one business day after your completed Account Application is
received by the Fund. If you did not purchase your shares with a certified check
or wire, the Fund may delay payment of your redemption proceeds for up to 15
days from date of purchase or until your check has cleared, whichever occurs
first.

The Fund may redeem the shares in your account if the value of your account is
less than $1,000 as a result of redemptions you have made. This does not apply
to retirement plan or Uniform Gifts or Transfers to Minors Act accounts. You
will be notified that the value of your account is less than $1,000 before the
Fund makes an involuntary redemption. You will then have 30 days in which to
make an additional investment to bring the value of your account to at least
$1,000 before the Fund takes any action.

The Fund has the right to pay redemption proceeds to you in whole or in part by
a distribution of securities from the Fund's portfolio. It is not expected that
the Fund would do so except in unusual circumstances. If the Fund pays your
redemption proceeds by a distribution of securities, you could incur brokerage
or other charges in converting the securities to cash.

PRICING OF FUND SHARES

The price of the Fund's shares is based on the Fund's net asset value. This is
calculated by dividing the Fund's assets, minus its liabilities, by the number
of shares outstanding. The Fund's assets are the market value of securities held
in its portfolio, plus any cash and other assets. The Fund's liabilities are
fees and expenses owed by the Fund. The number of Fund shares outstanding is the
amount of shares which have been issued to shareholders. The price you will pay
to buy Fund shares or the amount you will receive when you sell your Fund shares
is based on the net asset value next calculated after your order is received by
the Transfer Agent with complete information and meeting all the requirements
discussed in this Prospectus.

The net asset value of the Fund's shares is determined as of the close of
regular trading on the NYSE. This is normally 4:00 p.m., Eastern time. Fund
shares will not be priced on days that the NYSE is closed for trading (including
certain U.S. holidays).

DIVIDENDS AND DISTRIBUTIONS

The Fund will make distributions of dividends and capital gains, if any, at
least annually, typically after year end. The Fund will make another
distribution of any additional undistributed capital gains earned during the
12-month period ended October 31 on or about December 31.

All distributions will be reinvested in Fund shares unless you choose one of the
following options: (1) receive dividends in cash, while reinvesting capital gain
distributions in additional Fund shares; or (2) receive all distributions in
cash. If you wish to change your distribution option, write to the Transfer
Agent in advance of the payment date of the distribution.

TAX CONSEQUENCES

The Fund may make distributions of dividends and capital gains. Dividends are
taxable to you as ordinary income. The rate you pay on capital gain
distributions will depend on how long the Fund held the securities that
generated the gains, not on how long you owned your Fund shares. You will be
taxed in the same manner whether you receive your dividends and capital gain
distributions in cash or reinvest them in additional Fund shares.

If you sell your Fund shares, it is considered a taxable event for you.
Depending on the purchase price and the sale price of the shares you sell, you
may have a gain or a loss on the transaction. You are responsible for any tax
liabilities generated by your transaction.

FINANCIAL HIGHLIGHTS

This table shows the Fund's financial performance for the past five years.
Certain information reflects financial results for a single Fund share. "Total
return" shows how much your investment in the Fund would have increased or
decreased during each period, assuming you had reinvested all dividends and
distributions. This information has been audited by Ernst & Young LLP,
Independent Auditors. Their report and the Fund's financial statements are
included in the Annual Report, which is available upon request.

FOR A CAPITAL SHARE OUTSTANDING THROUGHOUT EACH YEAR

Year Ended June 30,
2001 2000 1999 1998 1997
Net asset value, beginning of 6.37 5.65
year . . . $ 2 $ 2 $ 22.35$ 16.29$ 12.08

INCOME FROM INVESTMENT
OPERATIONS:
Net investment loss . . 0.14 0.07
. .
. .
. .
. .
. . ( ) ( ) (0.13) (0.07) (0.04)
Net realized and unrealized
gain (loss)
on investments . . . . . . . 1.25
. . . . . . . . . ( ) 0.79 3.43 6.13 4.39

Total from investment . . 1.39
operations . ( ) 0.72 3.30 6.06 4.35

LESS DISTRIBUTIONS:
From net realized gain . .
. .
. .
. .
. . - - - - (0.14)

Net asset value, end of year . . 4.98 6.37
. . . . . . $ 2 $ 2 $ 25.65$ 22.35$ 16.29

Total return . . 5.27 .81% 4.77% 7.20
. .
. .
. .
. .
. .
. .
. .
. .
. . ( %)2 1 3 % 36.29%

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of year
(millions) . . $ 81.2$ 86.9$ 129.0$ 89.4$ 26.9

RATIO OF EXPENSES TO AVERAGE
NET ASSETS:
Before fees waived and
expenses absorbed . . .38% .31% .43%
. .
. .
. .
. .
. .
. 1 1 1.31% 1 1.87%
After fees waived and
expenses
absorbed . . .38% .31% .42%
. .
. .
. .
. .
. .
. .
. .
. .
. . 1 1 1.31% 1 1.48%

RATIO OF NET INVESTMENT
LOSS TO AVERAGE
NET ASSETS:
Before fees waived and
expenses absorbed . . 0.23%) 0.67%)
. .
. .
. .
. .
. .
. (0.54%)( (0.66%)( (0.79%)
After fees waived and
expenses absorbed . . 0.23%) 0.66%)
. .
. .
. .
. .
. .
. (0.54%)( (0.66%)( (0.39%)

Portfolio turnover rate . . . .
. . . . . . . . 3.12% 24.91% 14.27% 4.02% 21.49%

PRIVACY NOTICE

The Fund, the Advisor and the Distributor collect non-public information about
you from the following sources:

* Information we receive about you on applications or other forms;

* Information you give us orally; and

* Information about your transactions with us or others.

We do not disclose any non-public personal information about our customers or
former customers without the customer's authorization, except as required by law
or in response to inquiries from governmental authorities. We restrict access to
your personal and account information to those employees who need to know that
information to provide products and services to you. We also may disclose that
information to unaffiliated third parties (such as to brokers or custodians)
only as permitted by law and only as needed for us to provide agreed services to
you. We maintain physical, electronic and procedural safeguards to guard your
non-public personal information.

ADVISOR

Yeager, Wood & Marshall, Incorporated
630 Fifth Avenue
New York, New York 10111
(212) 765-5350

DISTRIBUTOR

Quasar Distributors, LLC
615 E. Michigan Street
Milwaukee, WI 53202

CUSTODIAN

Firstar Institutional Custody Services
425 Walnut Street
Cincinnati, Ohio 45202

TRANSFER AND
DIVIDEND
DISBURSING AGENT

American Data Services, Inc.
P.O. Box 542007
Omaha, NE 68154-1952

AUDITORS

Ernst & Young LLP
725 South Figueroa Street
Los Angeles, California 90017

LEGAL COUNSEL

Paul, Hastings, Janofsky & Walker, LLP
345 California Street, 29th Floor
San Francisco, California 94104

U.S. GLOBAL LEADERS GROWTH FUND
A SERIES OF PROFESSIONALLY MANAGED PORTFOLIOS (THE "TRUST")
WWW.USGLOBALLEADERS.COM

For investors who want more information about the Fund, the following documents
are available free upon request:

ANNUAL/SEMI-ANNUAL REPORTS. Additional information about the Fund's investments
is available in the Fund's annual and semi-annual reports to shareholders. In
the Fund's annual report, you will find a discussion of market conditions and
investment strategies that significantly affected the Fund's performance during
its last fiscal year.

STATEMENT OF ADDITIONAL INFORMATION (SAI). The SAI provides more detailed
information about the Fund and is incorporated by reference into this
Prospectus.

You can get free copies of reports and the SAI, request other information and
discuss your questions about the Fund by contacting the Fund at:

American Data Services, Inc.
P.O. Box 542007
Omaha, NE 68154-1952
Telephone: 1-800-282-2340

You can review and copy information including the Fund's reports and SAI at the
Public Reference Room of the Securities and Exchange Commission in Washington,
D.C. You can obtain information on the operation of the Public Reference Room by
calling 1-202-942-8090. Reports and other information about the Fund are also
available:

* Free of charge from the Commission's EDGAR database on the Commission's
Internet website at http://www.sec.gov, or

* For a fee, by writing to the Public Reference Room of the Commission,
Washington, DC 20549-0102, or

* For a fee, by electronic request at the following e-mail address:
publicinfo@sec.gov.

(The Trust's SEC Investment Company Act
file number is 811-05037)

STATEMENT OF ADDITIONAL INFORMATION

October 29, 2001

U.S. GLOBAL LEADERS GROWTH FUND
a series of
PROFESSIONALLY MANAGED PORTFOLIOS
630 Fifth Avenue
New York, NY 10111
(212) 765-5350

This Statement of Additional Information ("SAI") is not a prospectus
and it should be read in conjunction with the Prospectus dated October 29, 2001,
as may be revised, of U.S. Global Leaders Growth Fund (the "Fund"), a series of
Professionally Managed Portfolios (the "Trust"). Yeager, Wood & Marshall
Incorporated (the "Advisor") is the investment adviser to the Fund. A copy of
the Fund's Prospectus is available by calling the number listed above.

TABLE OF CONTENTS

The Trust .......................................................... B-2
Investment Objective and Policies .................................. B-2
Investment Restrictions ............................................ B-6
Distributions and Tax Information .................................. B-7
Trustees and Executive Officers .................................... B-9
The Fund's Investment Advisor ...................................... B-11
The Fund's Administrator ........................................... B-12
The Fund's Distributor ............................................. B-12
Execution of Portfolio Transactions ................................ B-13
Portfolio Turnover.................................................. B-14
Additional Purchase and Redemption Information ..................... B-15
Determination of Share Price ....................................... B-18
Performance Information ............................................ B-18
General Information ................................................ B-19
Financial Statements ............................................... B-21
Appendix ........................................................... B-21

B-1

THE TRUST

Professionally Managed Portfolios (the "Trust") is an open-end
management investment company organized as a Massachusetts business trust. The
Trust consists of various series which represent separate investment portfolios.
This SAI relates only to the Fund.

The Trust is registered with the SEC as a management investment
company. Such a registration does not involve supervision of the management or
policies of the Fund. The Prospectus of the Fund and this SAI omit certain of
the information contained in the Registration Statement filed with the SEC.
Copies of such information may be obtained from the SEC upon payment of the
prescribed fee.

INVESTMENT OBJECTIVE AND POLICIES

The U.S. Global Leaders Growth Fund is a mutual fund with the
investment objective of seeking growth of capital. The Fund is non-diversified,
which under the Investment Company Act of 1940 ("1940 Act") means that there is
no restriction under the 1940 Act on how much the Fund may invest in the
securities of any one issuer. The following discussion supplements the
discussion of the Fund's investment objective and policies as set forth in the
Prospectus. There can be no assurance the objective of the Fund will be
attained.

Repurchase Agreements. The Fund may enter into repurchase agreements
with respect to its portfolio securities. Pursuant to such agreements, the Fund
acquires securities from financial institutions such as banks and broker-dealers
as are deemed to be creditworthy by the Advisor, subject to the seller's
agreement to repurchase and the Fund's agreement to resell such securities at a
mutually agreed upon date and price. The repurchase price generally equals the
price paid by the Fund plus interest negotiated on the basis of current
short-term rates (which may be more or less than the rate on the underlying
portfolio security). Securities subject to repurchase agreements will be held by
the Custodian or in the Federal Reserve/Treasury Book-Entry System or an
equivalent foreign system. The seller under a repurchase agreement will be
required to maintain the value of the underlying securities at not less than
102% of the repurchase price under the agreement. If the seller defaults on its
repurchase obligation, the Fund will suffer a loss to the extent that the
proceeds from a sale of the underlying securities are less than the repurchase
price under the agreement. Bankruptcy or insolvency of such a defaulting seller
may cause the Fund's rights with respect to such securities to be delayed or
limited. Repurchase agreements are considered to be loans under the1940 Act.

Investment Companies. The Fund may invest in shares of other invest
companies in pursuit of its investment objective. This may include investment in
money market mutual funds in connection with the Fund's management of daily cash
positions. In addition to the advisory and operational fees the Fund bears
directly in connection with its own operation, the Fund and its shareholders
will also bear the pro rata portion of each other investment company's advisory
and operational expenses.

B-2

Foreign Investments. The Advisor is permitted to invest up to 25% of
the Fund's net assets in foreign companies, although the level of such
investment is not expected to exceed 15% under normal circumstances. The Advisor
intends to invest only in large capitalization, well established foreign issuers
the securities of which are traded in the U.S., and which present their
financial data in accordance with generally accepted accounting principles in
the U.S. Thus, the Advisor expects that there will be little if any risk
associated with its foreign investments.

American Depositary Receipts. The Fund may invest its assets in
securities of foreign issuers in the form of ADRs, which are receipts for the
shares of a foreign-based corporation. The Fund treats ADRs as interests in the
underlying securities for purposes of its investment policies. A purchaser of an
unsponsored ADR may not have unlimited voting rights and may not receive as much
information about the issuer of the underlying securities as with a sponsored
ADR.

Risks of Investing in Foreign Securities. Investments in foreign
securities involve certain inherent risks, including the following:

Political and Economic Factors. Individual foreign economies of certain
countries may differ favorably or unfavorably from the U.S. economy in such
respects as growth of gross national product, rate of inflation, capital
reinvestment, resource self-sufficiency, diversification and balance of payments
position. The internal politics of certain foreign countries may not be as
stable as those of the United States. Governments in certain foreign countries
also continue to participate to a significant degree, through ownership interest
or regulation, in their respective economies. Action by these governments could
include restrictions on foreign investment, nationalization, expropriation of
goods or imposition of taxes, and could have a significant effect on market
prices of securities and payment of interest. The economies of many foreign
countries are heavily dependent upon international trade and are accordingly
affected by the trade policies and economic conditions of their trading
partners. Enactment by these trading partners of protectionist trade legislation
could have a significant adverse effect upon the securities markets of such
countries.

Currency Fluctuations. The Fund may invest in securities denominated in
foreign currencies. Accordingly, a change in the value of any such currency
against the U.S. dollar will result in a corresponding change in the U.S. dollar
value of the Fund's assets denominated in that currency. Such changes will also
affect the Fund's income. The value of the Fund's assets may also be affected by
currency restrictions and exchange control regulations enacted from time to
time.

Euro Conversion. Several European countries adopted a single uniform
currency known as the "euro," effective January 1, 1999. The euro conversion,
that will take place over a several-year period, could have potential adverse
effects on the Fund's ability to value its portfolio holdings in foreign
securities, and could increase the costs associated with the Fund's operations.
The Fund and the Advisor are working with providers of services to the Fund in
the areas of clearance and settlement of trade in an effect to avoid any
material impact on the Fund due to the euro conversion; there can be no
assurance, however, that the steps taken will be sufficient to avoid any adverse
impact on the Fund.

B-3

Legal and Regulatory Matters. Certain foreign countries may have less
supervision of securities markets, brokers and issuers of securities, and less
financial information available to issuers, than is available in the United
States.

Taxes. The interest and dividends payable on certain of the Fund's
foreign portfolio securities may be subject to foreign withholding taxes, thus
reducing the net amount of income available for distribution to Fund
shareholders.

Costs. To the extent that the Fund invests in foreign securities, its
expense ratio is likely to be higher than those of investment companies
investing only in domestic securities, since the cost of maintaining the custody
of foreign securities is higher.

Emerging Markets. Some of the securities in which the Fund may invest
may be located in developing or emerging markets, which entail additional risks,
including less social, political and economic stability; smaller securities
markets and lower trading volume, which may result in less liquidity and greater
price volatility; national policies that may restrict the Fund's investment
opportunities, including restrictions on investments in issuers or industries,
or expropriation or confiscation of assets or property; and less developed legal
structures governing private or foreign investment.

Borrowing. The Fund may borrow money from banks in an aggregate amount
not to exceed one-third of the value of the Fund's total assets to meet
temporary or emergency purposes, and may pledge its assets in connection with
such borrowings. The Fund will not purchase any securities while any such
borrowings exceed 5% of the Fund's total assets.

Illiquid Securities. The Fund may not invest more than 15% of the value
of its net assets in securities that at the time of purchase have legal or
contractual restrictions on resale or are otherwise illiquid. The Advisor will
monitor the amount of illiquid securities in the Fund's portfolio, under the
supervision of the Trust's Board of Trustees, to ensure compliance with the
Fund's investment restrictions.

Historically, illiquid securities have included securities subject to
contractual or legal restrictions on resale because they have not been
registered under the Securities Act of 1933 (the "Securities Act"), securities
which are otherwise not readily marketable and repurchase agreements having a
maturity of longer than seven days. Securities which have not been registered
under the Securities Act are referred to as private placement or restricted
securities and are purchased directly from the issuer or in the secondary
market. Mutual funds do not typically hold a significant amount of these
restricted or other illiquid securities because of the potential for delays on
resale and uncertainty in valuation. Limitations on resale may have an adverse
effect on the marketability of portfolio securities and the Fund might be unable
to dispose of restricted or other illiquid securities promptly or at reasonable
prices and might thereby experience difficulty satisfying redemption requests
within seven days. The Fund might also have to register such restricted
securities in order to dispose of them, resulting in additional expense and
delay. Adverse market conditions could impede such a public offering of
securities.

B-4

In recent years, however, a large institutional market has developed
for certain securities that are not registered under the Securities Act,
including repurchase agreements, commercial paper, foreign securities, municipal
securities and corporate bonds and notes. Institutional investors depend on an
efficient institutional market in which the unregistered security can be readily
resold or on an issuer's ability to honor a demand for repayment. The fact that
there are contractual or legal restrictions on resale to the general public or
to certain institutions may not be indicative of the liquidity of such
investments. These securities might be adversely affected if qualified
institutional buyers were unwilling to purchase such securities. If such
securities are subject to purchase by institutional buyers in accordance with
Rule 144A promulgated by the SEC under the Securities Act, the Trust's Board of
Trustees may determine that such securities are not illiquid securities
notwithstanding their legal or contractual restrictions on resale. However,
these may become illiquid if institutions become for a time disinterested in
buying these securities. In all other cases, however, securities subject to
restrictions on resale will be deemed illiquid.

Short-Term Investments. The Fund may invest in any of the following securities
and instruments:

Certificates of Deposit, Bankers' Acceptances and Time Deposits. The
Fund may acquire certificates of deposit, bankers' acceptances and time
deposits. Certificates of deposit are negotiable certificates issued against
funds deposited in a commercial bank for a definite period of time and earning a
specified return. Bankers' acceptances are negotiable drafts or bills of
exchange, normally drawn by an importer or exporter to pay for specific
merchandise, which are "accepted" by a bank, meaning in effect that the bank
unconditionally agrees to pay the face value of the instrument on maturity.
Certificates of deposit and bankers' acceptances acquired by the Fund will be
dollar- denominated obligations of domestic banks, savings and loan associations
or financial institutions which, at the time of purchase, have capital, surplus
and undivided profits in excess of $100 million (including assets of both
domestic and foreign branches), based on latest published reports, or less than
$100 million if the principal amount of such bank obligations are fully insured
by the U.S. Government.

In addition to purchasing certificates of deposit and bankers'
acceptances, to the extent permitted under its investment objective and policies
stated above and in its prospectus, the Fund may make interest-bearing time or
other interest-bearing deposits in commercial or savings banks. Time deposits
are non-negotiable deposits maintained at a banking institution for a specified
period of time at a specified interest rate.

Commercial paper and short-term notes will consist of issues rated at
the time of purchase "A-2" or higher by Standard & Poor's Ratings Group,
"Prime-1" or "Prime-2" by Moody's Investors Service, Inc., or similarly rated by
another nationally recognized statistical rating organization or,

B-5

if unrated, will be determined by the Advisor to be of comparable quality. These
rating symbols are described in the Appendix.

INVESTMENT RESTRICTIONS

The following policies and investment restrictions have been adopted by
the Fund and (unless otherwise noted) are fundamental and cannot be changed
without the affirmative vote of a majority of the Fund's outstanding voting
securities as defined in the 1940 Act. The Fund may not:

1. Make loans to others, except (a) through the occasional purchase of
debt securities in accordance with its investment objectives and policies, (b)
to the extent the entry into a repurchase agreement is deemed to be a loan.

2. (a) Borrow money, except as stated in the Prospectus and this SAI.
Any such borrowing will be made only if immediately thereafter there is an asset
coverage of at least 300% of all borrowings.

(b) Mortgage, pledge or hypothecate any of its assets except in
connection with any such borrowings.

3. Purchase securities on margin, participate on a joint or joint and
several basis in any securities trading account, or underwrite securities. (Does
not preclude the Fund from obtaining such short-term credit as may be necessary
for the clearance of purchases and sales of its portfolio securities.)

4. Purchase or sell real estate, commodities or commodity contracts
(the Board of Trustees may in the future authorize the Fund to engage in certain
activities regarding futures contracts for bona fide hedging purposes; any such
authorization will be accompanied by appropriate notification to shareholders).

5. Invest 25% or more of the market value of its assets in the
securities of companies engaged in any one industry. (Does not apply to
investment in the securities of the U.S. Government, its agencies or
instrumentalities.)

6. Issue senior securities, as defined in the 1940 Act, except that
this restriction shall not be deemed to prohibit the Fund from (a) making any
permitted borrowings, mortgages or pledges, or (b) entering into repurchase
transactions.

7. Invest in any issuer for purposes of exercising control or
management.

The Fund observes the following policies, which are not deemed
fundamental and which may be changed without shareholder vote. The Fund may not:

8. Invest in securities of other investment companies except as
permitted under the 1940 Act.

B-6

9. Invest, in the aggregate, more than 15% of its net assets in
securities with legal or contractual restrictions on resale, securities which
are not readily marketable and repurchase agreements with more than seven days
to maturity.

10. With respect to fundamental investment restriction 2(a) above, the
Fund will not purchase portfolio securities while outstanding borrowings exceed
5% of its assets.

Except with respect to borrowing and illiquid securities, if a
percentage restriction set forth in the prospectus or in this SAI is adhered to
at the time of investment, a subsequent increase or decrease in a percentage
resulting from a change in the values of assets will not constitute a violation
of that restriction.

DISTRIBUTIONS AND TAX INFORMATION

Distributions

Dividends from net investment income and distributions from net profits
from the sale of securities are generally made annually. Also, the Fund expects
to distribute any undistributed net investment income on or about December 31 of
each year. Any net capital gains realized through the period ended October 31 of
each year will also be distributed by December 31 of each year.

Each distribution by the Fund is accompanied by a brief explanation of
the form and character of the distribution. In January of each year the Fund
will issue to each shareholder a statement of the federal income tax status of
all distributions.

Tax Information

Each series of the Trust is treated as a separate entity for federal
income tax purposes. The Fund intends to continue to qualify as a regulated
investment company under Subchapter M of the Internal Revenue Code of 1986 (the
"Code"), provided it complies with all applicable requirements regarding the
source of its income, diversification of its assets and timing of distributions.
The Fund's policy is to distribute to shareholders all of its investment company
taxable income and any net realized long-term capital gains for each fiscal year
in a manner that complies with the distribution requirements of the Code, so
that the Fund will not be subject to any federal income or excise taxes. To
comply with the requirements, the Fund must also distribute (or be deemed to
have distributed) by December 31 of each calendar year (i) at least 98% of
ordinary income for such year, (ii) at least 98% of the excess of realized
capital gains over realized capital losses for the 12- month period ending on
October 31 during such year and (iii) any amounts from the prior calendar year
that were not distributed and on which the Fund paid no federal income tax.

Net investment income consists of interest and dividend income, less
expenses. Net realized capital gains for a fiscal period are computed by taking
into account any capital loss carryforward of the Fund.

B-7

Distributions of net investment income and net short-term capital gains
are taxable to shareholders as ordinary income. In the case of corporate
shareholders, a portion of the distributions may qualify for the intercorporate
dividends-received deduction to the extent the Fund designates the amount
distributed as a qualifying dividend. The aggregate amount so designated cannot,
however, exceed the aggregate amount of qualifying dividends received by the
Fund for its taxable year. In view of the Fund's investment policies, it is
expected that dividends from domestic corporations may be part of the Fund's
gross income and that, accordingly, part of the distributions by the Fund may be
eligible for the dividends-received deduction for corporate shareholders.
However, the portion of the Fund's gross income attributable to qualifying
dividends is largely dependent on the Fund's investment activities for a
particular year and therefore cannot be predicted with any certainty. The
deduction may be reduced or eliminated if Fund shares held by a corporate
investor are treated as debt-financed or are held for less than 46 days.

Distributions of the excess of net long-term capital gains over net
short-term capital losses are taxable to shareholders as long-term capital
gains, regardless of the length of time they have held their shares. Capital
gains distributions are not eligible for the dividends-received deduction
referred to in the previous paragraph. Distributions of any net investment
income and net realized capital gains will be taxable as described above,
whether received in shares or in cash. Shareholders electing to receive
distributions in the form of additional shares will have a cost basis for
federal income tax purposes in each share so received equal to the net asset
value of a share on the reinvestment date. Distributions are generally taxable
when received. However, distributions declared in October, November or December
to shareholders of record on a date in such a month and paid the following
January are taxable as if received on December 31. Distributions are includable
in alternative minimum taxable income in computing a shareholder's liability for
the alternative minimum tax.

A redemption of Fund shares may result in recognition of a taxable gain
or loss. Any loss realized upon a redemption may be disallowed under certain
wash sale rules to the extent shares of the same Fund are purchased (through
reinvestment of distributions or otherwise) within 30 days before or after the
redemption or exchange.

Under the Code, the Fund will be required to report to the Internal
Revenue Service all distributions of taxable income and capital gains as well as
gross proceeds from the redemption or exchange of Fund shares, except in the
case of exempt shareholders, which includes most corporations. Pursuant to the
backup withholding provisions of the Code, distributions of any taxable income
and capital gains and proceeds from the redemption of Fund shares may be subject
to withholding of federal income tax in the case of non-exempt shareholders who
fail to furnish the Fund with their taxpayer identification numbers and with
required certifications regarding their status under the federal income tax law.
If the withholding provisions are applicable, any such distributions and
proceeds, whether taken in cash or reinvested in additional shares, will be
reduced by the amounts required to be withheld. Corporate and other exempt
shareholders should provide the Fund with their taxpayer identification numbers
or certify their exempt status in order to avoid possible erroneous application
of backup withholding. The Fund reserves the right to refuse to open an account
for any person failing to provide a certified taxpayer identification number.

B-8

The Fund may be subject to foreign withholding taxes on dividends and
interest earned with respect to securities of foreign corporations.

The Fund will not be subject to tax in the Commonwealth of
Massachusetts as long as it qualifies as a regulated investment company for
federal income tax purposes. Distributions and the transactions referred to in
the preceding paragraphs may be subject to state and local income taxes, and the
tax treatment thereof may differ from the federal income tax treatment.
Moreover, the above discussion is not intended to be a complete discussion of
all applicable federal tax consequences of an investment in the Fund.
Shareholders are advised to consult with their own tax advisers concerning the
application of federal, state and local taxes to an investment in the Fund.

The foregoing discussion of U.S. federal income tax law relates solely
to the application of that law to U.S. citizens or residents and U.S. domestic
corporations, partnerships, trusts and estates. Each shareholder who is not a
U.S. person should consider the U.S. and foreign tax consequences of ownership
of shares of the Fund, including the possibility that such a shareholder may be
subject to a U.S. withholding tax at a rate of 30 percent (or at a lower rate
under an applicable income tax treaty) on amounts constituting ordinary income.

This discussion and the related discussion in the prospectus have been
prepared by Fund management, and counsel to the Fund has expressed no opinion in
respect thereof.

TRUSTEES AND EXECUTIVE OFFICERS

The Trustees of the Trust, who were elected for an indefinite term by
the initial shareholders of the Trust, are responsible for the overall
management of the Trust, including general supervision and review of the
investment activities of the Fund. The Trustees, in turn, elect the officers of
the Trust, who are responsible for administering the day-to-day operations of
the Trust and its separate series. The current Trustees and officers, their
affiliations, dates of birth and principal occupations for the past five years
are set forth below. Unless noted otherwise, each person has held the position
listed for a minimum of five years.

Steven J. Paggioli,* 04/03/50 President and Trustee

915 Broadway, New York, New York 10010. Executive Vice President, Investment
Company Administration, LLC ("ICA") (mutual fund administrator and the Fund's
administrator); Vice President, Advisors Series Trust; Trustee, Managers Funds.

Dorothy A. Berry, 08/12/43 Chairman and Trustee

4455 E. Camelback Rd., Suite 261-E, Phoenix, AZ 85018. President, Talon
Industries (venture capital and business consulting); formerly Chief Operating
Officer, Integrated Asset Management (investment advisor and manager) and
formerly President, Value Line, Inc., (investment advisory and financial
publishing firm).

B-9

Wallace L. Cook 09/10/39 Trustee

4455 E. Camelback Rd., Suite 261-E, Phoenix, AZ 85018. Retired. Formerly Senior
Vice President, Rockefeller Trust Co. Financial Counselor, Rockefeller & Co.

Carl A. Froebel 05/23 /38 Trustee

4455 E. Camelback Rd., Suite 261-E, Phoenix, AZ 85018. Private Investor.
Formerly Managing Director, Premier Solutions, Ltd. Formerly President and
Founder, National Investor Data Services, Inc. (investment related computer
software).

Rowley W.P. Redington 06/01/44 Trustee

4455 E. Camelback Rd., Suite 261-E, Phoenix, AZ 85018. President; Intertech
(consumer electronics and computer service and marketing); formerly Vice
President, PRS of New Jersey, Inc. (management consulting), and Chief Executive
Officer, Rowley Associates (consultants).

Robert M. Slotky* 6/17/47 Treasurer

2020 E. Financial Way, Suite 100, Glendora, California 91741. Senior Vice
President, ICA since May 1997; former instructor of accounting at California
State University-Northridge (1997); Chief Financial Officer, Wanger Asset
Management L.P. and Treasurer of Acorn Investment Trust (1992- 1996).

Robin Berger* 11/17/56 Secretary

915 Broadway, New York, New York 10010. Vice President, The Wadsworth Group
since June, 1993.

Robert H. Wadsworth* 01/25/40 Vice President

4455 E. Camelback Road, Suite 261E, Phoenix, Arizona 85018. President, Robert H.
Wadsworth & Associates, Inc. and ICA; Vice President, Advisors Series Trust;
President and Trustee, Trust for Investment Managers; Director, Germany Fund,
Inc., New Germany Fund, Inc., Central European Equity Fund, Inc. and Deutsche
Funds, Inc.

*Indicates an "interested person" of the Trust as defined in the 1940 Act.

Set forth below is the rate of compensation received by the following
Trustees from all portfolios of the Trust for the calendar year ended December
31, 2000. This total amount is allocated among the portfolios. Disinterested
Trustees receive an annual retainer of $10,000 and a fee of $2,500 for each
regularly scheduled meeting. These Trustees also receive a fee of $1,000 for any
special meeting attended. The Chairman of the Board of Trustees receives an
additional annual retainer of $5,000. Disinterested trustees are also reimbursed
for expenses in connection with

B-10

each Board meeting attended. No other compensation or retirement benefits were
received by any Trustee from the portfolios of the Trust.

Name of Trustee Total Annual Compensation
- --------------- -------------------------

Dorothy A. Berry $25,000
Wallace L. Cook $20,000
Carl A. Froebel $20,000
Rowley W.P. Redington $20,000

During the Fund's fiscal year ended June 30, 2001, $11,092 of Trustees'
fees and expenses were allocated to the Fund. As of the date of this SAI, the
Trustees and Officers of the Trust as a group did not own more than 1% of the
outstanding shares of the Fund.

THE FUND'S INVESTMENT ADVISOR

The Board of Trustees of the Trust establishes the Fund's policies and
supervises and reviews the management of the Fund.

Under the Investment Advisory Agreement with the Fund, the Advisor
provides the Fund with advice on buying and selling securities, manages the
investments of the Fund, furnishes the Fund with office space and certain
administrative services, and provides most of the personnel needed by the Fund.
As compensation, the Fund pays the Advisor a monthly investment advisory fee
(accrued daily) based upon the average daily net assets of the Fund at the rate
of 1.00% annually. The Investment Advisory Agreement continues in effect for
successive annual periods so long as such continuation is approved at least
annually by the vote of (1) the Board of Trustees of the Trust (or a majority of
the outstanding shares of the Fund to which the agreement applies), and (2) a
majority of the Trustees who are not interested persons of any party to the
Agreement, in each case cast in person at a meeting called for the purpose of
voting on such approval. Any such agreement may be terminated at any time,
without penalty, by either party to the agreement upon sixty days' written
notice and is automatically terminated in the event of its "assignment," as
defined in the 1940 Act.

The Advisor has voluntarily agreed to reduce its fees and/or pay
expenses of the Fund to ensure that the Fund's aggregate annual operating
expenses (excluding interest and tax expenses) will not exceed 1.39% of the
Fund's average daily net assets. Any reduction in advisory fees or payment of
expenses made by the Advisor may be reimbursed by the Fund if the Advisor
requests in subsequent fiscal years. This reimbursement may be requested by the
Advisor if the aggregate amount actually paid by the Fund toward operating
expenses for such fiscal year (taking into account the reimbursement) does not
exceed the applicable limitation on Fund expenses. The Advisor is permitted to
be reimbursed for fee reductions and/or expense payments made in the prior three
fiscal years. Any such reimbursement will be reviewed by the Trustees. The Fund
must pay its current ordinary operating expenses before the Advisor is entitled
to any reimbursement of fees and/or expenses.

B-11

During the fiscal years ended June 30, 2001, 2000 and 1999, the Fund
paid advisory fees of $845,254, $1,042,045 and $1,017,545, respectively.

THE FUND'S ADMINISTRATOR

Investment Company Administration, LLC (the "Administrator") acts as
administrator for the Fund. The Administrator is a division of Firstar Mutual
Fund Services, LLC ("FMFS"), an affiliate of US Bancorp. FMFS provides one or
more of its core administration, transfer agency, fund accounting, distribution
and custodial services to over 250 mutual fund complexes comprised of 800 fund
portfolios with an aggregate market value of approximately $130 billion. The
Administration Agreement provides that the Administrator will prepare and
coordinate reports and other materials supplied to the Trustees; prepare and/or
supervise the preparation and filing of all securities filings, periodic
financial reports, prospectuses, statements of additional information, marketing
materials, tax returns, shareholder reports and other regulatory reports or
filings required of the Fund; prepare all required filings necessary to maintain
the Fund's ability to sell shares in all states where it currently does, or
intends to do business; coordinate the preparation, printing and mailing of all
materials (e.g., annual reports) required to be sent to shareholders; coordinate
the preparation and payment of Fund related expenses; monitor and oversee the
activities of the Fund's servicing agents (i.e., transfer agent, custodian, fund
accountants, etc.); review and adjust as necessary the Fund's daily expense
accruals; and perform such additional services as may be agreed upon by the Fund
and the Administrator. For its services, the Administrator receives a monthly
fee based on the Fund's average daily net assets at the following annual rate:

Average net assets Fee or fee rate
- ------------------ ---------------

Under $15 million $30,000
$15 to $50 million 0.20% of average net assets
$50 to $80 million 0.15% of average net assets
$80 million to $100 million 0.10% of average net assets
Over $100 million 0.05% of average net assets

During the fiscal years ended June 30, 2001, 2000 and 1999, the Fund
paid the Administrator fees of $149,480, $164,270 and $162,193, respectively.

THE FUND'S DISTRIBUTOR

Quasar Distributors, LLC (the "Distributor") acts as the Fund's
distributor in a continuous public offering of the Fund's shares. The
Distribution Agreement between the Fund and the Distributor continues in effect
for periods not exceeding one year if approved at least annually by (i) the
Board of Trustees or the vote of a majority of the outstanding shares of the
Fund (as defined in the 1940 Act) and (ii) a majority of the Trustees who are
not interested persons of any such party, in each case cast in person at a
meeting called for the purpose of voting on such approval. The Distribution
Agreement may be terminated without penalty by the parties thereto upon sixty
days' written notice, and is automatically terminated in the event of its
assignment as defined in the 1940 Act.

B-12

EXECUTION OF PORTFOLIO TRANSACTIONS

Pursuant to the Investment Advisory Agreement, the Advisor determines
which securities are to be purchased and sold by the Fund and which
broker-dealers are eligible to execute the Fund's portfolio transactions.
Purchases and sales of securities in the over-the-counter market will generally
be executed directly with a "market-maker" unless, in the opinion of the
Advisor, a better price and execution can otherwise be obtained by using a
broker for the transaction.

Purchases of portfolio securities for the Fund also may be made
directly from issuers or from underwriters. Where possible, purchase and sale
transactions will be effected through dealers (including banks) which specialize
in the types of securities which the Fund will be holding, unless better
executions are available elsewhere. Dealers and underwriters usually act as
principal for their own accounts. Purchases from underwriters will include a
concession paid by the issuer to the underwriter and purchases from dealers will
include the spread between the bid and the asked price. If the execution and
price offered by more than one dealer or underwriter are comparable, the order
may be allocated to a dealer or underwriter that has provided research or other
services as discussed below.

In placing portfolio transactions, the Advisor will use its reasonable
efforts to choose broker- dealers capable of providing the services necessary to
obtain the most favorable price and execution available. The full range and
quality of services available will be considered in making these determinations,
such as the size of the order, the difficulty of execution, the operational
facilities of the firm involved, the firm's risk in positioning a block of
securities, and other factors. In those instances where it is reasonably
determined that more than one broker-dealer can offer the services needed to
obtain the most favorable price and execution available, consideration may be
given to those broker-dealers which furnish or supply research and statistical
information to the Advisor that it may lawfully and appropriately use in its
investment advisory capacities, as well as provide other services in addition to
execution services. The Advisor considers such information, which is in addition
to and not in lieu of the services required to be performed by it under its
Agreement with the Fund, to be useful in varying degrees, but of indeterminable
value. Portfolio transactions may be placed with broker-dealers who sell shares
of the Fund subject to rules adopted by the National Association of Securities
Dealers, Inc.

While it is the Fund's general policy to seek first to obtain the most
favorable price and execution available in selecting a broker-dealer to execute
portfolio transactions for the Fund, weight is also given to the ability of a
broker-dealer to furnish brokerage and research services to the Fund or to the
Advisor, even if the specific services are not directly useful to the Fund and
may be useful to the Advisor in advising other clients. In negotiating
commissions with a broker or evaluating the spread to be paid to a dealer, the
Fund may therefore pay a higher commission or spread than would be the case if
no weight were given to the furnishing of these supplemental services, provided
that the amount of such commission or spread has been determined in good faith
by the Advisor to be reasonable in relation to the value of the brokerage and/or
research services provided by such broker-dealer. The standard of reasonableness
is to be measured in light of the Advisor's overall responsibilities to the
Fund.

B-13

Investment decisions for the Fund are made independently from those of
other client accounts or mutual funds ("Funds") managed or advised by the
Advisor. Nevertheless, it is possible that at times identical securities will be
acceptable for both the Fund and one or more of such client accounts or Funds.
In such event, the position of the Fund and such client account(s) or Funds in
the same issuer may vary and the length of time that each may choose to hold its
investment in the same issuer may likewise vary. However, to the extent any of
these client accounts or Funds seeks to acquire the same security as the Fund at
the same time, the Fund may not be able to acquire as large a portion of such
security as it desires, or it may have to pay a higher price or obtain a lower
yield for such security. Similarly, the Fund may not be able to obtain as high a
price for, or as large an execution of, an order to sell any particular security
at the same time. If one or more of such client accounts or Funds simultaneously
purchases or sells the same security that the Fund is purchasing or selling,
each day's transactions in such security will be allocated between the Fund and
all such client accounts or Funds in a manner deemed equitable by the Advisor,
taking into account the respective sizes of the accounts and the amount being
purchased or sold. It is recognized that in some cases this system could have a
detrimental effect on the price or value of the security insofar as the Fund is
concerned. In other cases, however, it is believed that the ability of the Fund
to participate in volume transactions may produce better executions for the
Fund.

The Fund does not effect securities transactions through brokers in
accordance with any formula, nor does it effect securities transactions through
brokers solely for selling shares of the Fund, although the Fund may consider
the sale of shares as a factor in allocating brokerage. However, as stated
above, broker-dealers who execute brokerage transactions may effect purchase of
shares of the Fund for their customers. The Fund does not use the Distributor to
execute its portfolio transactions.

For the fiscal years ended June 30, 2001 and 2000, the Fund paid $2,778
and $109,873, respectively, in brokerage commissions. For the fiscal year ended
June 30, 1999, the Fund paid $80,491 in brokerage commissions, of which $4,564
was paid to firms that furnished research services.

PORTFOLIO TURNOVER

Although the Fund generally will not invest for short-term trading
purposes, portfolio securities may be sold without regard to the length of time
they have been held when, in the opinion of the Advisor, investment
considerations warrant such action. Portfolio turnover rate is calculated by
dividing (1) the lesser of purchases or sales of portfolio securities for the
fiscal year by (2) the monthly average of the value of portfolio securities
owned during the fiscal year. A 100% turnover rate would occur if all the
securities in the Fund's portfolio, with the exception of securities whose
maturities at the time of acquisition were one year or less, were sold and
either repurchased or replaced within one year. A high rate of portfolio
turnover (100% or more) generally leads to higher transaction costs and may
result in a greater number of taxable transactions. See "Execution of Portfolio
Transactions." For the fiscal years ended June 30, 2001 and 2000, the Fund had a
portfolio turnover rate of 3.12% and 24.91%, respectively.

B-14

ADDITIONAL PURCHASE AND REDEMPTION INFORMATION

The information provided below supplements the information contained in
the Fund's Prospectus regarding the purchase and redemption of Fund shares.

How to Buy Shares

You may purchase shares of the Fund from selected securities brokers,
dealers or financial intermediaries. Investors should contact these agents
directly for appropriate instructions, as well as information pertaining to
accounts and any service or transaction fees that may be charged by those
agents. Purchase orders through securities brokers, dealers and other financial
intermediaries are effected at the next-determined net asset value after receipt
of the order by such agent before the Fund's daily cutoff time. Orders received
after that time will be purchased at the next-determined net asset value.

The public offering price of Fund shares is the net asset value. The
Fund receives the net asset value. Shares are purchased at the public offering
price next determined after the Transfer Agent receives your order in proper
form as discussed in the Fund's Prospectus. In most cases, in order to receive
that day's public offering price, the Transfer Agent must receive your order in
proper form before the close of regular trading on the New York Stock Exchange
("NYSE"). If you buy shares through your investment representative, the
representative must receive your order before the close of regular trading on
the NYSE to receive that day's public offering price. Orders are in proper form
only after funds are converted to U.S. funds.

If you are considering redeeming or transferring shares to another
person shortly after purchase, you should pay for those shares with a certified
check to avoid any delay in redemption, exchange or transfer. Otherwise the Fund
may delay payment until the purchase price of those shares has been collected
or, if you redeem by telephone, until 15 calendar days after the purchase date.
To eliminate the need for safekeeping, the Fund will not issue certificates for
your shares unless you request them.

The Trust reserves the right in its sole discretion (i) to suspend the
continued offering of the Fund's shares, (ii) to reject purchase orders in whole
or in part when in the judgment of the Advisor or the Distributor such rejection
is in the best interest of the Fund, and (iii) to reduce or waive the minimum
for initial and subsequent investments for certain fiduciary accounts or under
circumstances where certain economies can be achieved in sales of the Fund's
shares.

The Fund may also issue Fund shares in exchange for appropriate
portfolio securities. Such transactions may benefit the Fund by eliminating the
transaction costs that would otherwise be borne by the Fund in purchasing
portfolio securities in the stock markets. Under certain limited conditions, an
investor may purchase Fund shares with portfolio securities that are moved into
the Fund's portfolio on a tax-free basis for the investor. In such instance, the
unrealized gain or loss in the transferred portfolio would become unrealized
gain or loss for the Fund.

B-15

How to Sell Shares

You can sell your Fund shares any day the NYSE is open for regular
trading, either directly to the Fund or through your investment representative.
The Fund will forward redemption proceeds or redeem shares for which it has
collected payment of the purchase price.

Payments to shareholders for Fund shares redeemed directly from the
Fund will be made as promptly as possible but no later than seven days after
receipt by the Fund's Transfer Agent of the written request with complete
information and meeting all the requirements discussed in the Fund's Prospectus,
except that the Fund may suspend the right of redemption or postpone the date of
payment during any period when (a) trading on the NYSE is restricted as
determined by the SEC or the NYSE is closed for other than weekends and
holidays; (b) an emergency exists as determined by the SEC making disposal of
portfolio securities or valuation of net assets of the Fund not reasonably
practicable; or (c) for such other period as the SEC may permit for the
protection of the Fund's shareholders. At various times, the Fund may be
requested to redeem shares for which it has not yet received confirmation of
good payment. In this circumstance, the Fund may delay the redemption until
payment for the purchase of such shares has been collected and confirmed to the
Fund.

Selling shares directly to the Fund

Send a signed letter of instruction to the Transfer Agent. The price
you will receive is the next net asset value calculated after your order is
received by the Transfer Agent with complete information and meeting all the
requirements discussed in the Fund's Prospectus. In order to receive that day's
net asset value, the Transfer Agent must receive your request before the close
of regular trading on the NYSE.

Selling shares through your investment representative

Your investment representative must receive your request before the
close of regular trading on the NYSE to receive that day's net asset value. Your
investment representative will be responsible for furnishing all necessary
documentation to the Transfer Agent, and may charge you for its services.

If you want your redemption proceeds sent to an address other than your
address as it appears on the Transfer Agent's records, a signature guarantee is
required. The Fund may require additional documentation for the sale of shares
by a corporation, partnership, agent or fiduciary, or a surviving joint owner.
Contact the Transfer Agent for details.

Delivery of proceeds

The Fund generally sends you payment for your shares the business day
after your request is received in proper form, assuming the Fund has collected
payment of the purchase price of your shares. Under unusual circumstances, the
Fund may suspend redemptions, or postpone payment for

B-16

more than seven days, but only as authorized by SEC rules, as stated above under
"How to Sell Shares."

Telephone redemptions

Upon receipt of any instructions or inquiries by telephone from a
shareholder or, if held in a joint account, from either party, or from any
person claiming to be the shareholder, the Fund or its agent is authorized,
without notifying the shareholder or joint account parties, to carry out the
instructions or to respond to the inquiries, consistent with the service options
chosen by the shareholder or joint shareholders in his or their latest Account
Application or other written request for services, including purchasing,
exchanging or redeeming shares of the Fund and depositing and withdrawing monies
from the bank account specified in the shareholder's latest Account Application
or as otherwise properly specified to the Fund in writing.

The Transfer Agent will employ these and other reasonable procedures to
confirm that instructions communicated by telephone are genuine; if it fails to
employ reasonable procedures, the Fund may be liable for any losses due to
unauthorized or fraudulent instructions. An investor agrees, however, that to
the extent permitted by applicable law, neither the Fund nor its agents will be
liable for any loss, liability, cost or expense arising out of any redemption
request, including any fraudulent or unauthorized request. For information,
consult the Transfer Agent.

During periods of unusual market changes and shareholder activity, you
may experience delays in contacting the Transfer Agent by telephone. In this
event, you may wish to submit a written redemption request, as described in the
Prospectus, or contact your investment representative. The Telephone Redemption
Privilege is not available if you were issued certificates for shares that
remain outstanding. The Telephone Redemption Privilege may be modified or
terminated without notice.

Redemptions-in-kind

The Trust has filed an election under SEC Rule 18f-1 committing to pay
in cash all redemptions by a shareholder of record up to amounts specified by
the rule (in excess of the lesser of (i) $250,000 or (ii) 1% of the Fund's
assets). The Fund has reserved the right to pay the redemption price of its
shares in excess of the amounts specified by the rule, either totally or
partially, by a distribution in kind of portfolio securities (instead of cash).
The securities so distributed would be valued at the same amount as that
assigned to them in calculating the net asset value for the shares being sold.
If a shareholder receives a distribution in kind, the shareholder could incur
brokerage or other charges in converting the securities to cash.

The value of shares on redemption or repurchase may be more or less
than the investor's cost, depending upon the market value of the Fund's
portfolio securities at the time of redemption or repurchase.

B-17

DETERMINATION OF SHARE PRICE

As noted in the Prospectus, the net asset value of shares of the Fund
will be determined once daily as of the close of public trading on the NYSE
(normally 4:00 p.m. Eastern time) on each day that the NYSE is open for trading.
It is expected that the NYSE will be closed on Saturdays and Sundays and on New
Year's Day, Martin Luther King Jr. Day, Presidents' Day, Good Friday, Memorial
Day, Independence Day, Labor Day, Thanksgiving Day and Christmas. The Fund does
not expect to determine the net asset value of shares on any day when the NYSE
is not open for trading even if there is sufficient trading in its portfolio
securities on such days to materially affect the net asset value per share.
However, the net asset value of Fund shares may be determined on days the NYSE
is closed or at times other than 4:00 p.m. if the Board of Trustees decides it
is necessary.

In valuing the Fund's assets for calculating net asset value, readily
marketable portfolio securities listed on a national securities exchange or on
NASDAQ are valued at the last sale price on the business day as of which such
value is being determined. If there has been no sale on such exchange or on
NASDAQ on such day, the security is valued at the closing bid price on such day.
Readily marketable securities traded only in the over-the-counter market and not
on NASDAQ are valued at the last reported bid price. If no bid is quoted on such
day, the security is valued by such method as the Board of Trustees of the Trust
shall determine in good faith to reflect the security's fair value. All other
assets of each Fund are valued in such manner as the Board of Trustees in good
faith deems appropriate to reflect their fair value.

The net asset value per share of the Fund is calculated as follows: all
liabilities incurred or accrued are deducted from the valuation of total assets
which includes accrued but undistributed income; the resulting net assets are
divided by the number of shares of the Fund outstanding at the time of the
valuation and the result (adjusted to the nearest cent) is the net asset value
per share.

PERFORMANCE INFORMATION

From time to time, the Fund may state its total return in
advertisements and investor communications. Total return may be stated for any
relevant period as specified in the advertisement or communication. Any
statements of total return will be accompanied by information on the Fund's
average annual compounded rate of return over the most recent four calendar
quarters and the period from the Fund's inception of operations. The Fund may
also advertise aggregate and average total return information over different
periods of time.

The Fund's total return may be compared to relevant indices, including
Standard & Poor's 500 Composite Stock Index and indices published by Lipper,
Inc. From time to time, evaluations of a Fund's performance by independent
sources may also be used in advertisements and in information furnished to
present or prospective investors in the Fund.

Investors should note that the investment results of the Fund will
fluctuate over time, and any presentation of the Fund's total return for any
period should not be considered as a

B-18

representation of what an investment may earn or what an investor's total return
may be in any future period.

The Fund's average annual compounded rate of return is determined by
reference to a hypothetical $1,000 investment that includes capital appreciation
and depreciation for the stated period, according to the following formula:

P(1+T)n = ERV

Where: P = a hypothetical initial purchase order of $1,000 from which the
maximum sales load is deducted

T = average annual total return
n = number of years
ERV = ending redeemable value of the hypothetical $1,000 purchase at
the end of the period

Aggregate total return is calculated in a similar manner, except that
the results are not annualized. Each calculation assumes that all dividends and
distributions are reinvested at net asset value on the reinvestment dates during
the period.

Average annual total return for the Fund for the periods ending June
30, 2001 are as follows:

One Year -5.27%
Five Years 15.88%
From Inception 17.46%
(September 29, 1995)

GENERAL INFORMATION

Investors in the Fund will be informed of the Fund's progress through
periodic reports. Financial statements certified by independent public
accountants will be submitted to shareholders at least annually.

Firstar Institutional Custody Services, located at 425 Walnut St.,
Cincinnati, Ohio 45201 acts as Custodian of the securities and other assets of
the Fund. The Custodian, the Distributor and Administrator are affiliated
companies. American Data Services, Inc., P.O. Box 542007, Omaha, NE 68154-1952
acts as the Fund's transfer and shareholder service agent. The Custodian and
Transfer Agent do not participate in decisions relating to the purchase and sale
of securities by the Fund.

Ernst & Young LLP, 725 South Figueroa, Los Angeles, CA 90017, are the
independent auditors for the Fund.

B-19

Paul, Hastings, Janofsky & Walker, LLP, 345 California St., 29th floor,
San Francisco, California 94104, are legal counsel to the Fund.

On September 30, 2001, the following persons owned of record and/or
beneficially more than 5% of the Fund's outstanding voting securities:

Salomon Smith Barney, New York, NY 10001; 16.11% Lazard Freres & Co.
LLC, New York, NY 10020; 6.83% Charles Schwab & Co., San Francisco, CA
94104; 22.23% Brandt Dayton, TTEE, New York, NY 10023; 6.59%

The Trust was organized as a Massachusetts business trust on February
24, 1987. The Agreement and Declaration of Trust permits the Board of Trustees
to issue an unlimited number of full and fractional shares of beneficial
interest, without par value, which may be issued in any number of series. The
Board of Trustees may from time to time issue other series, the assets and
liabilities of which will be separate and distinct from any other series.

Shares issued by the Fund have no preemptive, conversion, or
subscription rights. Shareholders have equal and exclusive rights as to
dividends and distributions as declared by the Fund and to the net assets of the
Fund upon liquidation or dissolution. The Fund, as a separate series of the
Trust, votes separately on matters affecting only the Fund (e.g., approval of
the Advisory Agreement); all series of the Trust vote as a single class on
matters affecting all series jointly or the Trust as a whole (e.g., election or
removal of Trustees). Voting rights are not cumulative, so that the holders of
more than 50% of the shares voting in any election of Trustees can, if they so
choose, elect all of the Trustees. While the Trust is not required and does not
intend to hold annual meetings of shareholders, such meetings may be called by
the Trustees in their discretion, or upon demand by the holders of 10% or more
of the outstanding shares of the Trust, for the purpose of electing or removing
Trustees.

The shareholders of a Massachusetts business trust could, under certain
circumstances, be held personally liable as partners for its obligations.
However, the Trust's Agreement and Declaration of Trust contains an express
disclaimer of shareholder liability for acts or obligations of the Trust. The
Agreement and Declaration of Trust also provides for indemnification and
reimbursement of expenses out of the Fund's assets for any shareholder held
personally liable for obligations of the Fund or Trust. The Agreement and
Declaration of Trust provides that the Trust shall, upon request, assume the
defense of any claim made against any shareholder for any act or obligation of
the Fund or Trust and satisfy any judgment thereon. All such rights are limited
to the assets of the Fund. The Agreement and Declaration of Trust further
provides that the Trust may maintain appropriate insurance (for example,
fidelity bonding and errors and omissions insurance) for the protection of the
Trust, its shareholders, trustees, officers, employees and agents to cover
possible tort and other liabilities. Furthermore, the activities of the Trust as
an investment company would not likely give rise to liabilities in excess of the
Trust's total assets. Thus, the risk of a shareholder incurring financial loss
on account of shareholder liability is limited to circumstances in which both
inadequate insurance exists and the Fund itself is unable to meet its
obligations.

B-20

The Board of the Trust, the Advisor and the Distributor have adopted
Codes of Ethics under Rule 17j-1 of the 1940 Act. These Codes permit, subject to
certain conditions, personnel of the Adviser and Distributor to invest in
securities that may be purchased or held by the Fund.

FINANCIAL STATEMENTS

The annual report to shareholders for the Fund for its most recent
fiscal year end is a separate document supplied with this SAI and the financial
statements, accompanying notes and report of independent accountants appearing
therein are incorporated by reference in this SAI.

APPENDIX
COMMERCIAL PAPER RATINGS

Moody's Investors Service, Inc.

Prime-1--Issuers (or related supporting institutions) rated "Prime-1"
have a superior ability for repayment of senior short-term debt obligations.
"Prime-1" repayment ability will often be evidenced by many of the following
characteristics: leading market positions in well-established industries, high
rates of return on funds employed, conservative capitalization structures with
moderate reliance on debt and ample asset protection, broad margins in earnings
coverage of fixed financial charges and high internal cash generation, and
well-established access to a range of financial markets and assured sources of
alternate liquidity.

Prime-2--Issuers (or related supporting institutions) rated "Prime-2"
have a strong ability for repayment of senior short-term debt obligations. This
will normally be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be more
subject to variation. Capitalization characteristics, while still appropriate,
may be more affected by external conditions. Ample alternative liquidity is
maintained.

Standard & Poor's Ratings Group

A-1--This highest category indicates that the degree of safety
regarding timely payment is strong. Those issues determined to possess extremely
strong safety characteristics are denoted with a plus (+) sign designation.

A-2--Capacity for timely payment on issues with this designation is
satisfactory. However, the relative degree of safety is not as high as for
issues designated "A-1".

B-21

US
GLOBAL
LEADERS
----
GROWTH
FUND

ANNUAL REPORT
For the Year Ended
June 30, 2001

US
GLOBAL
LEADERS
----
GROWTH
FUND

Dear Fellow Long-Term Investor:

The following summarizes investment performance for our Fund including
comparisons with the S&P 500 Index:

Year 5 Years Inception
Ending Ending (9/30/95) to
6/30/01 6/30/01 6/30/01
(Annualized) (Annualized)
- --------------------------------------------------------------------------------

U.S. Global Leaders Growth Fund* -5.27% 15.88% 17.46%
U.S. Global Leaders (After-Tax) -5.27 15.80 17.39

S&P 500 Index -14.85 14.46 15.50
Lipper Large Cap Core Fund Index -16.09 12.98 13.82
Lipper Growth Fund Index -30.39 11.91 12.22
Lipper International Fund Index -22.11 5.54 6.66

"Each business cycle has its own unique characteristics, never before
experienced and never again to be repeated." Consistent with this observation of
Alfred Marshall, the great economist of the early 20th Century, it is
appropriate to point out that the kind of slowdown which the U.S. is currently
experiencing is different from anything seen in the recent past. In contrast to
the 1970's, there has been no significant external phenomenon like the OPEC
induced oil price shocks. Unlike the 1980's, there is little inflation and
consequent monetary policy squeeze. Instead, this slowdown has been triggered by
a turn in the investment cycle.

The unprecedented capital goods boom -- particularly in the
information-technology sector -- has given way to an unprecedented bust. To what
degree and duration the adjustment plays out is unknown at this juncture --
except it is clear that a capital spending correction is much longer lasting
than an inventory correction. Businesses do not lay off workers in large numbers
if they believe a turnaround is "around the corner".

Despite the travails in technology -- and, to a much lesser extent, general
manufacturing and consumer durable goods production -- the probability remains
that a full-blown recession will be avoided. Powerful monetary stimulus already
in process has now been supplemented by expansionary fiscal policy. U.S.
competitiveness remains strong.

Long-term productivity growth is still intact. Demographic changes, and possible
policy changes, are destined to boost the pool of savings to be invested. More
realistic stock market valuations are already leading to better corporate
decisions. Hopefully, better investment decisions eventually will be made by
stock market participants, as well. Accordingly, the necessary conditions are
already in place for resumption of the next upward leg of the most powerful bull
market in modern history.

In the past, serious recessions in critical business sectors -- such as the
defense industry after the collapse of communism, farming, and the rust belt --
have not held back advances of the overall economy and the stock market. Those
uneven expansions were called "rolling readjustments". Perhaps this is an apt
description of what is now underway. The previous rolling readjustment most
analogous to what is currently taking place was the bust in the energy industry
that followed the boom occasioned by the aforementioned surge of oil prices in
the 1970's. (For one day in 1980, Schlumberger, Ltd., the oil service industry
leader, became the world's most highly capitalized company. Its shares have yet
to re-attain that twenty-year-ago level.) In the present rolling readjustment,
substitute technology for energy. (Cisco Systems was the world's most highly
valued company at one point last year. Hmmm...)

Of course, U.S. Global Leaders Growth Fund isn't invested "in the market". It is
a concentrated portfolio of formidably competitive, sustainable growth companies
with a global reach. These enterprises provide services or sell products that
are consumed and need to be replaced, and hence are far less impacted by
economic slowdowns here and abroad than most companies. They should still be
able to post earnings gains collectively at close to the low end of their
traditional 15 - 20% range. In contrast, corporate profits in the aggregate are
likely to decline.

In summary, our "Global Leaders" can be regarded as comfortable holdings during
whatever remains of the economic correction. More importantly, we believe they
are exceptionally well positioned to be rewarding holdings in the next period of
expansion.

I encourage you to periodically visit the Fund's internet website:
www.usgloballeaders.com. The homepage for our site is a monthly update of the
Fact Sheet on the Fund, which shows current holdings, recent performance with
relevant comparisons and other important data. Click on the "In the News"
section to see a profile on U.S. Global Leaders Growth Fund that appeared in the
June 2001 issue of Financial Advisor Magazine.

It is said that successful investing, like success itself, is a journey, not a
destination. We are gratified that you have chosen to invest with U.S. Global
Leaders Growth Fund. We are committed to making it a safe and rewarding
experience.

Cordially,

/S/ GEORGE M. YEAGER
- --------------------
George M. Yeager

- ----------
* Past performance is no guarantee of future results. Investment returns and
share value will fluctuate and investors may have a gain or loss when they
redeem shares. The Standard and Poor's 500 Index is an unmanaged index generally
representative of the market for stocks of large sized U.S. companies. The
Lipper Large-Cap Core Fund Index is an unmanaged, net asset weighted index of 30
mutual funds that invest primarily in large companies with wide latitude in the
type of shares they buy. The Lipper Growth Fund Index is an unmanaged, net asset
weighted index of 30 mutual funds that invest primarily in companies of all
market capitalizations with potential for growth. The Lipper International Fund
Index is an unmanaged, net asset weighted index of 30 mutual funds that invest
in securities primarily trading in markets outside the U.S. These indices are
not available for investment and do not incur fees or expenses.

[GRAPH OMITTED]

U.S. GLOBAL LEADERS GROWTH FUND
VALUE OF $10,000 VS. S&P 500 INDEX
AVERAGE ANNUAL TOTAL RETURN
PERIOD ENDED JUNE 30, 2001
1 YEAR........................ (5.27%)
5 YEARS....................... 15.88%
SINCE INCEPTION (9/29/95)..... 17.46%

GRAPH DEPICTS THE COMPARISON OF A $10,000 INVESTMENT FROM THE PERIOD 9/29/95
TO 6/30/01 BETWEEN THE U.S.GLOBAL LEADERS GROWTH FUND AND THE S&P 500 INDEX.

Date U.S. Global Leaders Growth Fund S&P 500 Index w/inc
---- ------------------------------- -------------------
9/29/95 10,000 10,000
12/31/95 10,673 10,599
6/30/96 12,083 11,663
12/31/96 13,143 13,035
6/30/97 16,469 15,712
12/31/97 18,461 17,382
6/30/98 22,595 20,447
12/31/98 24,365 22,349
6/30/99 25,932 25,109
12/31/99 26,285 27,043
6/30/00 26,660 26,926
12/31/00 27,377 23,219
6/30/01 25,254 21,663

U.S. GLOBAL LEADERS GROWTH FUND

- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS at June 30,2001
- --------------------------------------------------------------------------------

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

COMMON STOCKS: 98.2%

BEVERAGES: 4.0%

72,800 Coca-Cola Co. .................................. $3,276,000
----------
BUSINESS & INFORMATION SERVICES: 3.8%
62,200 Automatic Data Processing, Inc. ................ 3,091,340
----------
ENTERTAINMENT & LODGING: 8.0%
137,400 Marriott International, Inc. - Class A ......... 6,504,516
----------
FINANCIAL SERVICES: 8.0%
35,200 American Express Co. ........................... 1,365,760
103,500 State Street Corp. ............................. 5,122,215
----------
6,487,975
----------
FOOD SERVICES: 12.5%
114,000 McDonald's Corp. ............................... 3,084,840
307,720 Starbucks Corp.* ............................... 7,077,560
----------
10,162,400
----------
FOODS: 4.5%
78,200 Wrigley (WM.) JR. Co. .......................... 3,663,670
----------
HEALTH PRODUCTS: 9.6%
59,100 Abbott Laboratories ............................ 2,837,391
99,200 Johnson & Johnson .............................. 4,960,000
----------
7,797,391
----------
HOUSEHOLD PRODUCTS: 3.3%
44,700 Colgate Palmolive Co. .......................... 2,636,853
----------
INSURANCE: 5.7%
53,512 American International Group, Inc. ............. 4,602,032
----------
MASS MERCHANDISING: 6.3%
104,313 Wal-Mart Stores, Inc. .......................... 5,090,475
----------
PHARMACEUTICALS: 12.2%
66,700 Merck & Co. .................................... 4,262,797
140,100 Pfizer, Inc. ................................... 5,611,005
----------
9,873,802
----------
SPECIALTY RETAILING: 16.9%
94,800 Home Depot, Inc. ............................... 4,412,940
290,125 Staples, Inc.* ................................. 4,639,099
128,870 Tiffany & Co. .................................. 4,667,671
----------
13,719,710
----------
TOILETRIES: 3.4%
95,392 Gillette Company (The) ......................... 2,765,414
----------
TOTAL COMMON STOCKS
(cost $51,555,077) ..................................... 79,671,578
----------

U.S. GLOBAL LEADERS GROWTH FUND

- --------------------------------------------------------------------------------
SCHEDULE OF INVESTMENTS at June 30,2001 (Continued)
- --------------------------------------------------------------------------------

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

Principal
Amount Value
REPURCHASE AGREEMENT: 2.4%
$1,964,000 Firstar Bank Repurchase Agreement, 3.15%,
dated 6/29/2001, due 7/2/2001
(collateralized by $2,003,277 FHLMC,
6.0%, due 3/1/2025) (value of proceeds
$1,964,516) (cost $1,964,000) $ 1,964,000
-----------
TOTAL INVESTMENTS IN SECURITIES
(cost $53,519,077+): 100.6% 81,635,578
Liabilities in excess of Other Assets: (0.6)% (471,012)
-----------
NET ASSETS: 100.0% $81,164,566
<FN>
-----------
* Non-income producing security.
+ At June 30, 2001, the basis of investments for federal income tax purposes
was $53,572,487. Gross unrealized appreciation and depreciation for federal
income tax purposes were as follows:

Gross unrealized appreciation $29,944,568
Gross unrealized depreciation (1,881,477)
-----------
Net unrealized appreciation $28,063,091
===========

</FN>

See accompanying Notes to Financial Statements.

U.S. GLOBAL LEADERS GROWTH FUND

- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES at June 30, 2001
- --------------------------------------------------------------------------------

ASSETS

Investments in securities, at value
(cost $53,519,077) ........................... $ 81,635,578
Cash ................................................. 474
Receivables:
Dividends and interest ....................... 74,239
Fund shares sold ............................. 25,428
Prepaid expenses ..................................... 1,362
------------
Total assets ................................. 81,737,081
------------
LIABILITIES
Payables:
Due to advisor ............................... 71,979
Administration fees .......................... 1,206
Fund shares redeemed ......................... 471,249
Accrued expenses ..................................... 28,081
------------
Total liabilities .................... 572,515
------------

NET ASSETS ........................................... $ 81,164,566
============
Net asset value, offering and redemption price
per share
($81,164,566/3,248,988 shares outstanding;
unlimited number of shares authorized
without par value) ................................... $ 24.98
============
COMPONENTS OF NET ASSETS
Paid-in capital ...................................... $ 59,817,386
Accumulated net realized loss on investments ......... (6,769,321)
Net unrealized appreciation on investments ........... 28,116,501
------------
Net assets ................................... $ 81,164,566
============

See accompanying Notes to Financial Statements.

U.S. GLOBAL LEADERS GROWTH FUND

- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS For the Year Ended June 30, 2001
- --------------------------------------------------------------------------------

INVESTMENT INCOME
Income

Dividends ....................................... $ 658,680
Interest ........................................ 54,201
-----------
Total income ............................ 712,881
-----------
Expenses
Advisory fees ................................... 845,254
Administration fees ............................. 149,480
Fund accounting fees ............................ 37,655
Registration fees ............................... 25,130
Audit fees ...................................... 24,814
Custody fees .................................... 20,811
Transfer agent fees ............................. 19,771
Miscellaneous ................................... 12,456
Trustee fees .................................... 11,092
Reports to shareholders ......................... 10,733
Legal fees ...................................... 8,093
Insurance expense ............................... 4,256
-----------
Total expenses .......................... 1,169,545
-----------
Net investment loss ............. (456,664)
-----------

REALIZED AND UNREALIZED LOSS ON INVESTMENTS
Net realized loss on investments ........................ (1,552,209)
Net unrealized depreciation on investments .............. (2,735,150)
Net unrealized appreciation reclassified on investments
redeemed-in-kind (Note 2) ....................... 39,696
-----------
Net realized and unrealized loss on investments . (4,247,663)
-----------
Net decrease in net assets resulting from
operations .............................. $(4,704,327)
===========

See accompanying Notes to Financial Statements.

U.S. GLOBAL LEADERS GROWTH FUND

- --------------------------------------------------------------------------------
STATEMENTS OF CHANGES IN NET ASSETS
- --------------------------------------------------------------------------------

Year Ended Year Ended
June 30, 2001 June 30, 2000
- ---------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS

Net investment loss .................... $ (456,664) $ (235,543)
Net realized loss on investments ....... (1,552,209) (3,128,940)
Net unrealized depreciation
on investments ................. (2,735,150) (11,006,573)
Net unrealized appreciation
reclassified on investments
redeemed-in-kind ............... 39,696 14,689,574
------------- -------------
Net increase (decrease) in net
assets resulting from operations (4,704,327) 318,518
------------- -------------

CAPITAL SHARE TRANSACTIONS
Net decrease in net assets derived
from net change in
outstanding shares (a) ........ (1,044,554) (42,357,663)
------------- -------------
Total decrease in net assets ... (5,748,881) (42,039,145)

NET ASSETS
Beginning of year ...................... 86,913,447 128,952,592
------------- -------------
End of year ............................ $ 81,164,566 $ 86,913,447
============= =============

(a) A summary of capital share transactions is as follows:

Year Ended Year Ended
June 30, 2001 June 30, 2000
------------- -------------
Shares Value Shares Value
------ ----- ------ -----

Shares sold ............. 384,717 $ 9,952,842 1,715,378 $ 42,449,422
Shares redeemed ......... (431,808) (10,997,396) (3,447,285) (84,807,085)
-------- ------------ ---------- ------------
Net decrease ............ (47,091) $ (1,044,554) (1,731,907) $(42,357,663)
======== ============ ========== ============

See accompanying Notes to Financial Statements.

U.S. GLOBAL LEADERS GROWTH FUND

- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS for a capital share outstanding throughout each period.
- --------------------------------------------------------------------------------

Year Ended June 30,
------------------------------------------------------
2001 2000 1999 1998 1997
- ------------------------------------------------------------------------------------------------------------

Net asset value, beginning of year ................ $ 26.37 $ 25.65 $ 22.35 $ 16.29 $ 12.08
--------- --------- ---------- --------- ---------
Income from investment operations:
Net investment loss ....................... (0.14) (0.07) (0.13) (0.07) (0.04)
Net realized and unrealized
gain (loss) on investments ........ (1.25) 0.79 3.43 6.13 4.39
--------- --------- ---------- --------- ---------
Total from investment operations .................. (1.39) 0.72 3.30 6.06 4.35
--------- --------- ---------- --------- ---------
Less distributions:
From net realized gain .................... -- -- -- -- (0.14)
--------- --------- ---------- --------- ---------
Net asset value, end of year ...................... $ 24.98 $ 26.37 $ 25.65 $ 22.35 $ 16.29
========= ========= ========== ========= =========
Total return ...................................... (5.27%) 2.81% 14.77% 37.20% 36.29%
Ratios/supplemental data:
Net assets, end of year (millions) ........ $ 81.2 $ 86.9 $ 129.0 $ 89.4 $ 26.9
Ratio of expenses to average net assets:
Before fees waived and
expenses absorbed ................. 1.38% 1.31% 1.31% 1.43% 1.87%
After fees waived and
expenses absorbed ................. 1.38% 1.31% 1.31% 1.42% 1.48%
Ratio of net investment loss to average net assets:
Before fees waived and
expenses absorbed ................. (0.54%) (0.23%) (0.66%) (0.67%) (0.79%)
After fees waived and
expenses absorbed ................. (0.54%) (0.23%) (0.66%) (0.66%) (0.39%)
Portfolio turnover rate ................... 3.12% 24.91% 14.27% 4.02% 21.49%

See accompanying Notes to Financial Statements.

U.S. GLOBAL LEADERS GROWTH FUND

- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------

NOTE 1 - ORGANIZATION

The U.S. Global Leaders Growth Fund (the "Fund") is a non-diversified
series of shares of beneficial interest of Professionally Managed Portfolios
(the "Trust") which is registered under the Investment Company Act of 1940 (the
"1940 Act") as an open-end management investment company. The Fund began
operations on September 29, 1995. The investment objective of the Fund is to
seek growth of capital. The Fund seeks to achieve its objective by investing in
sustainable growth companies with a global reach.

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently
followed by the Fund. These policies are in conformity with accounting
principles generally accepted in the United States.

A. SECURITY VALUATION. Investments in securities traded on a national
securities exchange or Nasdaq are valued at the last reported sale
price at the close of regular trading on each day that the exchanges
are open for trading; securities traded on an exchange or Nasdaq for
which there have been no sales and other over-the-counter securities
are valued at the last reported bid price. Securities for which
quotations are not readily available are valued at their respective
fair values as determined in good faith by the Board of Trustees.
Short-term investments are stated at cost which, when combined with
accrued interest, approximates market value.

B. FEDERAL INCOME TAXES. The Fund intends to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its taxable income to
its shareholders. Therefore, no federal income tax provision is
required.

C. SECURITY TRANSACTIONS, DIVIDEND INCOME AND DISTRIBUTIONS. Security
transactions are accounted for on the trade date. The cost of
securities sold is determined on an identified cost basis. Dividend
income and distributions to shareholders are recorded on the
ex-dividend date.

D. USE OF ESTIMATES. The preparation of financial statements in
conformity with accounting principles generally accepted in the
United States requires management to make estimates and assumptions
that affect the reported amounts of assets and liabilities at the
date of the financial statements. Actual results could differ from
those estimates.

E. RECLASSIFICATION OF CAPITAL ACCOUNTS. The Fund accounts and reports
for distribution to shareholders in accordance with the American
Institute of Certified Public Accountant's Statement of

U.S. GLOBAL LEADERS GROWTH FUND

- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (Continued)
- --------------------------------------------------------------------------------

Position 93-2: Determination, Disclosure, and Financial Statement
Presentation of Income, Capital and Return of Capital Distributions
by Investment Companies. For the year ended June 30, 2001, the Fund
decreased paid-in capital by $456,664 due to the Fund experiencing a
net investment loss during the year. In addition, the Fund
distributed securities with a market value of $220,163 and a cost of
$180,467 to shareholders in in-kind redemptions during the year
ended June 30, 2001. The net unrealized appreciation of $39,696 was
reclassified to paid-in capital. Net assets were not affected by
these reclassifications.

NOTE 3 - COMMITMENTS AND OTHER RELATED PARTY TRANSACTIONS

For the year ended June 30, 2001, Yeager, Wood & Marshall, Incorporated
(the "Advisor") provided the Fund with investment management services under an
Investment Advisory Agreement. The Advisor furnished all investment advice,
office space, facilities and most of the personnel needed by the Fund. As
compensation for its services, the Advisor was entitled to a monthly fee at the
annual rate of 1.00% based upon the average daily net assets of the Fund. For
the year ended June 30, 2001, the Fund incurred $845,254 in advisory fees.

The Fund is responsible for its own operating expenses. However, the
Advisor has agreed to limit the Fund's total expenses to not more than 1.39% of
average daily net assets. Any such reductions made by the Advisor in its fees or
payments or reimbursement of expenses which are the Fund's obligation are
subject to reimbursement by the Fund within three years, provided the Fund is
able to effect such reimbursement and remain in compliance with any applicable
expense limitations then in effect. The Advisor has agreed not to seek
recoupment of the expenses waived for the Fund.

Investment Company Administration, L.L.C. (the "Administrator") acts as
the Fund's Administrator under an Administration Agreement. The Administrator
prepares various federal and state regulatory filings, reports and returns for
the Fund; prepares reports and materials to be supplied to the trustees;
monitors the activities of the Fund's custodian, transfer agent and accountants;
coordinates the preparation and payment of Fund expenses and reviews the Fund's
expense accruals. For its services, the Administrator receives a monthly fee at
the following annual rate:

Under $15 million - $30,000
$15 to $50 million - 0.20% of average daily net assets
$50 to $80 million - 0.15% of average daily net assets
$80 to $100 million - 0.10% of average daily net assets
Over $100 million - 0.05% of average daily net assets

For the year ended June 30, 2001, the Fund incurred $149,480 in
administration fees.

U.S. GLOBAL LEADERS GROWTH FUND

First Fund Distributors, Inc. (the "Distributor") acts as the Fund's
principal underwriter in a continuous public offering of the Fund's shares. The
Distributor is an affiliate of the Administrator.

Certain officers and trustees of the Trust are also officers and/or
directors of the Administrator and the Distributor.

NOTE 4 - PURCHASES AND SALES OF SECURITIES

The cost of purchases and proceeds from the sale of securities, excluding
short-term investments, for the year ended June 30, 2001, were $2,611,673 and
$3,955,333, respectively.

NOTE 5 - FEDERAL INCOME TAXES

As of June 30, 2001, the Fund had available for federal income tax
purposes $6,708,108 of unused capital loss carry forwards of which $524,262 will
expire in 2006, $1,563,910 will expire in 2007, $3,011,350 will expire in 2008
and $1,608,586 will expire in 2009.

NOTE 6 - REPURCHASE AGREEMENTS

The Fund may enter into repurchase agreements with government securities
dealers recognized by the Federal Reserve Board, with member banks of the
Federal Reserve System or with such other brokers or dealers that meet the
credit guidelines established by the Board of Trustees. The Fund will always
receive and maintain, as collateral, securities whose market value, including
accrued interest, will be at least equal to 102% of the dollar amount invested
by the Fund in each agreement, and the Fund will make payment for such
securities only upon physical delivery or upon evidence of book entry transfer
to the account of the custodian. To the extent that any repurchase transaction
exceeds one business day, the value of the collateral is marked-to-market on a
daily basis to ensure the adequacy of the collateral.

If the seller defaults and the value of the collateral declines, or if
bankruptcy proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.

U.S. GLOBAL LEADERS GROWTH FUND

- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT AUDITORS
- --------------------------------------------------------------------------------

To the Shareholders of
U.S. Global Leaders Growth Fund and
the Board of Trustees of
Professionally Managed Portfolios

We have audited the accompanying statement of assets and liabilities, including
the schedule of investments, of U.S. Global Leaders Growth Fund (the "Fund")
(one of the portfolios constituting the series of Professionally Managed
Portfolios), as of June 30, 2001, and the related statement of operations for
the year then ended, the statements of changes in net assets for each of the two
years in the period then ended, and the financial highlights for each of the
five years in the period then ended. These financial statements and financial
highlights are the responsibility of the Fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. 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 and financial highlights. Our procedures included
confirmation of securities owned as of June 30, 2001, 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 U.S.
Global Leaders Growth Fund as of June 30, 2001, the results of its operations
for the year then ended, the changes in its net assets for each of the two years
in the period then ended, and the financial highlights for each of the five
years in the period then ended, in conformity with accounting principles
generally accepted in the United States.

/s/ ERNST & YOUNG LLP
- ---------------------
Los Angeles, California
August 2, 2001

================================================================================

Advisor
YEAGER, WOOD & MARSHALL, INCORPORATED
630 Fifth Avenue
New York, New York 10111
(212) 765-5350

Distributor
FIRST FUND DISTRIBUTORS, INC.
4455 East Camelback Road, Suite 261E
Phoenix, Arizona 85018

Custodian
FIRSTAR INSTITUTIONAL CUSTODY SERVICES
425 Walnut Street
Cincinnati, Ohio 45202

Transfer and Dividend Disbursing Agent
AMERICAN DATA SERVICES, INC.
P.O. Box 542007
Omaha, Nebraska 68154-1952

Auditors
ERNST & YOUNG LLP
725 South Figueroa Street
Los Angeles, California 90017

Legal Counsel
PAUL, HASTINGS, JANOFSKY & WALKER, LLP
345 California Street, 29th Floor
San Francisco, California 94104

This report is intended for the shareholders of the Fund and may not be used as
sales literature unless preceded or accompanied by a current prospectus.

Past performance results shown in this report should not be considered a
representation of future performance. Due to market volatility, fund performance
may fluctuate substantially over short-term and current performance may differ
from that shown. Share price and returns will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost. Statements and
other information herein are dated and are subject to change.

U.S. GLOBAL
LEADERS
- ------
GROWTH
FUND

SEMI-ANNUAL REPORT
For the Six Months Ended
December 31, 2001

U.S. GLOBAL
LEADERS
- ------
GROWTH
FUND

Dear Fellow Long-Term Investor:

The following summarizes investment performance for our Fund including
comparisons with the S&P 500 Index:

Year 5 Years Inception
Ending Ending 9/30/95 to
12/31/01 12/31/01 12/31/01
(Annualized) (Annualized)
- --------------------------------------------------------------------------------
U.S. Global Leaders Growth Fund -6.83% 14.17% 16.13%
TAX ADJUSTED PRE-LIQUIDATION -6.83 14.17 16.07
TAX ADJUSTED POST-LIQUIDATION -4.16 11.88 13.72

S&P 500 Index -11.91 10.68 13.13
Lipper Large Cap Growth Index -23.87 7.50 9.62
Lipper International Fund Index -19.33 2.76 4.72

"The future ain't what it used to be." Yogi Berra's way of saying it lacks the
elegance of the quote of Alfred Marshall, the eminent economist of the early
20th century, which I cited in my July 2, 2001 letter: "Each business cycle has
its own unique characteristics, never before experienced and never again to be
repeated." But Yogi's words are just as apt and easier to remember.

It is already clear that certain aspects of this recession are indeed unique:
The speed with which it happened was much quicker than most people expected; it
was not policy induced because of inflation fears; and it most likely will be
shorter than average because of massive monetary stimulus, plunging energy costs
(the equivalent of a global tax cut approaching $100 billion), and the arresting
and eventual reversal of the record-breaking pace and amount of inventory
liquidations that have already impacted manufacturers. Indeed, the transition
from recession to recovery will soon be underway.

It is the profile of the recovery which will more importantly differentiate the
current business cycle from previous ones in the experience of most investors.
The coming rebound is likely to be muted versus the classic V-shaped patterns of
the recent past. In the words of the Financial Times: "A new surge in corporate
investment spending is far off given the huge decline in capacity utilization to
levels last seen in the early 1980's. With profits as a share of national income

having fallen every year since 1997, companies have added reasons to be
cautious." To make the point that businesses won't soon play their traditional
expansionary role, Yogi would have simply said: "If people don't want to come
out to the Park, nobody's going to stop them." Moreover, the U.S. cannot rely on
exports to ignite a strong recovery when Japan's recession appears to be
worsening and growth in Europe is stagnant at best. As to the all-important
consumer sector, there can't be a great deal of punch (this year anyway) in
light of high levels of household debt and two consecutive years of falling net
worth. Accordingly, a "normal" postwar recovery is not likely. It could well be
weak and slow.

So, what is the takeaway for investors from a sluggish recovery in which most
businesses will have little or no pricing power and will remain under intense
profit margin pressures until the recovery picks up steam? Veteran investment
strategist Barton Biggs of Morgan Stanley recently answered that critical
question this way: "A world with steeper, synchronized economic cycles, little
pricing power and therefore low inflation, more stable long-term interest rates
but more volatile short-term rates, pressure on profit margins, and altered risk
premiums changes the investment roadmap in ways I can't imagine. However, one
thing is for sure. Companies with growing earnings will get fancy valuations for
their stocks."

The message of Biggs' brief sermon is tantamount to preaching to those of us
already converted to a "religion" of investing in sustainable growth companies
and who know from experience that the most significant periods of out
performance for such an approach comes in periods of recession and slow economic
growth. This should be even truer now and for the foreseeable future, because
your "Global Leaders" portfolio companies have never been more attractively
valued relative to the market and in absolute terms in my forty years of
professional experience.

A two-tiered stock market with premium prices accorded faster growing companies
is the appropriate configuration unless the valuations reach ridiculous levels
as they did in the "Nifty Fifty" period in the early 1970's. Incongruously,
higher business risk NASDAQ companies now command the lofty heights of the top
tier of the market with the S&P 500 Index companies and high-quality growth
companies in the bottom tier. Just as topsy turvy is the fact that the average
P/E multiple of your sustainable growth companies is virtually the same as the
P/E of the S&P 500 Index even though your "Global Leaders" are growing twice as
fast.

It could well be that the market has reached a juncture where a reversal
of tiers is likely -- with dramatically favorable implications for the
investment performance of those companies that can sustain superior earnings
growth. U.S. Global Leaders Growth Fund shareholders are already on a pathway

towards realizing the rewards that would accrue from such an eventuality. Most
other investors have yet to heed Yogi's advice: "When you come to a fork in the
road, take it."

The Fund's transfer agent, Orbitex Data Services, has recently upgraded their
web access facility for shareholders. If you have not already done so, you can
view details on your shareholder account (i.e. current value, transactions,
registration). New users must first establish their own User ID and Password on
the site. To do this go to the Fund's web site (www.usgloballeaders.com) and
select "View Account Information" which is the last item on the navigation bar
to the left. A new page will open. Select "logging in for the first time". From
the drop down box select "US Global Funds". Then supply the Tax ID or SSN number
associated with the shareholder account (leaving out the dashes) along with a
self-selected User ID and Password. You can then use your User ID and Password
for future access. Should you have any difficulties, please contact Gordon
Marchand at our office (212-765-5350, GMarchand@ywm.com).

Cordially,

/s/ George M. Yeager
George M. Yeager

"Patience is the companion of wisdom." St. Augustine

PAST PERFORMANCE DOES NOT GUARANTEE 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 tax
adjusted returns are calculated using the historical highest individual federal
marginal income tax rates and do not reflect the impact of state and local
taxes. Actual tax adjusted returns depend on your situation and may differ from
those shown. Furthermore, the tax adjusted returns shown are not relevant to
those who hold their shares through tax-deferred arrangements. The Standard and
Poor's 500 Index is an unmanaged index generally representative of the market
for stocks of large-sized U.S. companies. The Lipper Large-Cap Growth Index is
an unmanaged, net asset weighted index of 30 mutual funds that invest primarily
in large companies with earnings expected to grow faster than stocks in major
market indices. The Lipper International Fund Index is an unmanaged, net asset
weighted index of 30 mutual funds that invest in securities primarily trading in
markets outside the U.S. These indices are not available for investment and do
not incur fees or expenses.

U.S. Global Leaders Growth Fund

SCHEDULE OF INVESTMENTS at December 31, 2001 (Unaudited)

SHARES VALUE
- --------------------------------------------------------------------------------
COMMON STOCKS: 96.8%
BEVERAGES: 4.1%

72,800 Coca-Cola Co. ........................ $3,432,520
----------

BUSINESS & Information Services: 6.3%
62,200 Automatic Data Processing, Inc. ...... 3,663,580
15,100 Marsh & McLennan Companies, Inc. ..... 1,622,495
----------
5,286,075
----------

ENTERTAINMENT & Lodging: 4.4%
92,400 Marriott International, Inc.-- Class A 3,756,060
----------

FINANCIAL SERVICES: 6.4%
103,500 State Street Corp. ................... 5,407,875
----------

FOOD SERVICES: 10.5%
114,000 McDonald's Corp. ..................... 3,017,580
307,720 Starbucks Corp.* ..................... 5,862,066
----------
8,879,646
----------

FOODS: 4.8%
78,200 Wrigley (WM.) JR. Co. ................ 4,017,134
----------

HEALTH PRODUCTS: 10.8%
59,100 Abbott Laboratories .................. 3,294,825
99,200 Johnson & Johnson .................... 5,862,720
----------
9,157,545
----------

HOUSEHOLD PRODUCTS: 3.1%
44,700 Colgate Palmolive Co. ................ 2,581,425
----------

INSURANCE: 5.0%
53,512 American International Group, Inc. ... 4,248,853
----------

MASS MERCHANDISING: 7.1%
104,313 Wal-Mart Stores, Inc. ................ 6,003,213
----------

PACKAGE DELIVERY SERVICES: 2.3%
35,800 United Parcel Service ................ 1,951,100
----------

PHARMACEUTICALS: 11.3%
66,700 Merck & Co. .......................... 3,921,960
140,100 Pfizer, Inc. ......................... 5,582,985
----------
9,504,945
----------

U.S. Global Leaders Growth Fund

SCHEDULE OF INVESTMENTS at December 31, 2001 (Unaudited) (Continued)

SHARES VALUE
- --------------------------------------------------------------------------------
SPECIALTY RETAILING: 16.9%
94,800 Home Depot, Inc. ..................... $4,835,748
290,125 Staples, Inc.* ....................... 5,425,337
128,870 Tiffany & Co. ........................ 4,055,539
----------
14,316,624
----------

TOILETRIES: 3.8%
95,392 Gillette Company (The) ............... 3,186,093
----------

TOTAL COMMON STOCKS
(cost $51,855,194) 81,729,108
----------

PRINCIPAL
AMOUNT VALUE
- --------------------------------------------------------------------------------
SHORT-TERM INVESTMENT: 2.9%

MONEY MARKET INVESTMENT 2.9%
$2,481,435 Federated Cash Trust Series II
(cost $2,481,435) ................... $ 2,481,435
-----------

TOTAL INVESTMENTS IN SECURITIES
(cost $54,336,629): 99.7% ........................ 84,210,543
Other Assets less Liabilities: 0.3% ...................... 263,899
-----------
NET ASSETS: 100.0% ....................................... $84,474,442
===========

<FN>
* Non-income producing security.
+ At December 31, 2001, the basis of investments for
federal income tax purposes was the same as their
cost for financial reporting purposes.
Unrealized appreciation and depreciation
were as follows:
Gross unrealized appreciation ........... $ 30,935,119
Gross unrealized depreciation ........... (1,061,205)
--------------
Net unrealized appreciation ............. $ 29,873,914

</FN>

See accompanying Notes to Financial Statements.

U.S. GLOBAL LEADERS GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES at December 31, 2001 (Unaudited)

ASSETS

Investments in securities, at value
(cost $54,336,629 ) ................................... $ 84,210,543
Receivables:
Fund shares sold ................................... 271,494
Dividends and interest ............................. 69,508
Prepaid expenses ......................................... 7,180
------------
Total assets ....................................... 84,558,725
------------
LIABILITIES
Payables:
Fund shares redeemed ............................... 33,779
Administration fees ................................ 13,392
Advisory fees ...................................... 8,508
Accrued expenses ......................................... 28,604
------------
Total liabilities .......................... 84,283
------------

NET ASSETS ............................................... $ 84,474,442
============
Net asset value, offering and redemption
price per share
($84,474,442/3,348,751 shares outstanding;
unlimited number of shares authorized
without par value) ..................................... $ 25.23
COMPONENTS OF NET ASSETS
Paid-in capital .......................................... $ 63,503,011
Accumulated net investment loss .......................... (1,491,619)
Accumulated net realized loss on investments ............. (7,410,864)
Net unrealized appreciation on investments ............... 29,873,914
------------
Net assets ......................................... $ 84,474,442
============

See accompanying Notes to Financial Statements.

U.S. GLOBAL LEADERS GROWTH FUND
STATEMENT OF OPERATIONS FOR THE SIX MONTHS ENDED DECEMBER 31, 2001 (Unaudited)

INVESTMENT INCOME

Income
Dividends ............................................. $ 371,275
Interest .............................................. 23,272
-----------
Total income .......................................... 394,547
-----------

Expenses
Advisory fees ......................................... 403,626
Administration fees ................................... 72,825
Fund accounting fees .................................. 18,768
Custody fees .......................................... 11,408
Transfer agent fees ................................... 10,856
Audit fees ............................................ 10,120
Registration fees ..................................... 9,016
Reports to shareholders ............................... 7,912
Trustee fees .......................................... 5,888
Legal fees ............................................ 3,864
Miscellaneous ......................................... 2,944
Insurance expense ..................................... 1,472
-----------
Total expenses ................................ 558,699
-----------
Net investment loss ................... (164,152)
-----------

REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss on investments .............................. (651,190)
Net unrealized appreciation on investments .................... 1,757,413
-----------
Net realized and unrealized gain on investments ....... 1,106,223
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS ....................................... $ 942,071
===========

See accompanying Notes to Financial Statements.
7

U.S. Global Leaders Growth Fund
STATEMENT OF CHANGES IN NET ASSETS

SIX MONTHS ENDED YEAR ENDED
DECEMBER 31, 2001# JUNE 30, 2001
------------------ -------------
INCREASE (DECREASE) IN NET ASSETS FROM:
OPERATIONS

Net investment loss .................... $ (164,152) $ (456,664)
Net realized loss on
investments .................... (651,190) (1,512,513)
Net unrealized appreciation
(depreciation) on investments .. 1,757,413 (2,735,150)
------------ ------------

Net increase (decrease) in net assets
resulting from operations ...... 942,071 (4,704,327)
------------ ------------

CAPITAL SHARE TRANSACTIONS
Net increase (decrease) in net assets
derived from net change in
outstanding shares (a) ......... 2,367,805 (1,044,554)
------------ ------------

Total increase (decrease) in net assets 3,309,876 (5,748,881)
------------ ------------

NET ASSETS
Beginning of period .................... 81,164,566 86,913,447
------------ ------------

End of period .......................... $ 84,474,442 $ 81,164,566
============ ============

<FN>
(a) A summary of capital share transactions is as follows:
</FN>

SIX MONTHS ENDED YEAR ENDED
DECEMBER 31, 2001# JUNE 30, 2001
------------------ -------------

SHARES VALUE SHARES VALUE
------ ----- ------ -----

Shares sold ............. 340,456 $ 8,265,697 384,717 $ 9,952,842
Shares redeemed ......... (240,693) (5,897,892) (431,808) (10,997,396)
-------- ----------- -------- ------------

Net increase
(decrease) ...... 99,763 $ 2,367,805 (47,091) $ (1,044,554)
======== =========== ======== ============

<FN>
# Unaudited.
</FN>

See accompanying Notes to Financial Statements.

U.S. Global Leaders Growth Fund

FINANCIAL HIGHLIGHTS For a capital share outstanding throughout
each period (Unaudited)

Six Months
Ended
Dec. 31, Year Ended June 30,
2001# 2001 2000 1999 1998 1997
----- ---- ---- ---- ---- ----

Net asset value, beginning of period .............. $ 24.98 $ 26.37 $ 25.65 $ 22.35 $ 16.29 $ 12.08

INCOME FROM INVESTMENT OPERATIONS:
Net investment loss ....................... (0.05) (0.14) (0.07) (0.13) (0.07) (0.04)
Net realized and unrealized
gain (loss) on investments ........ 0.30 (1.25) 0.79 3.43 6.13 4.39

Total from investment operations .......... 0.25 (1.39) 0.72 3.30 6.06 4.35

LESS DISTRIBUTIONS:
From net investment income ................ -- -- -- -- -- --
From net realized gain .................... -- -- -- -- -- (0.14)

Total distributions ....................... -- -- -- -- -- (0.14)

Net asset value, end of period ............ $ 25.23 $ 24.98 $ 26.37 $ 25.65 $ 22.35 $ 16.29
========= ========= ========= ========== ========= =========

Total return .............................. 1.00%^ (5.27)% 2.81% 14.77% 37.20% 36.29%

RATIOS/SUPPLEMENTAL DATA:
Net assets, end of period (millions) ...... $ 84.5 $ 81.2 $ 86.9 $ 129.0 $ 89.4 $ 26.9

RATIO OF EXPENSES TO AVERAGE NET ASSETS:
Before fees waived and expenses
absorbed .......................... 1.38%+ 1.38% 1.31% 1.31% 1.43% 1.87%
After fees waived and expenses
absorbed .......................... 1.38%+ 1.38% 1.31% 1.31% 1.42% 1.48%

RATIO OF NET INVESTMENT LOSS TO AVERAGE NET ASSETS:
Before fees waived and expenses
absorbed .......................... (0.41)%+ (0.54)% (0.23)% (0.66)% (0.67)% (0.79)%
After fees waived and
expenses absorbed ................. (0.41)%+ (0.54)% (0.23)% (0.66)% (0.66)% (0.39)%
Portfolio turnover rate ................... 3.61%^ 3.12% 24.91% 14.27% 4.02% 21.49%

<FN>
+ Annualized.
^ Not annualized.
# Unaudited.
</FN>

See accompanying Notes to Financial Statements.

U.S. GLOBAL LEADERS GROWTH FUND
NOTES TO FINANCIAL STATEMENTS (Unaudited)

NOTE 1 - ORGANIZATION

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

The following is a summary of significant accounting policies consistently
followed by the Fund. These policies are in conformity with accounting
principles generally accepted in the United States of America.

A. SECURITY VALUATION. Investments in securities traded on a national
securities exchange or NASDAQ are valued at the last reported sale
price at the close of regular trading on each day that the exchanges
are open for trading; securities traded on an exchange or NASDAQ for
which there have been no sales and other over-the-counter securities
are valued at the last reported bid price. Securities for which
quotations are not readily available are valued at their respective
fair values as determined in good faith by the Board of Trustees.
Short-term investments are stated at cost which, when combined with
accrued interest, approximates market value.

B. FEDERAL INCOME TAXES. The Fund intends to comply with the requirements
of the Internal Revenue Code applicable to regulated investment
companies and to distribute all of its taxable income to its
shareholders. Therefore, no federal income tax provision is required.

D. USE OF ESTIMATES. The preparation of financial statements in
conformity with accounting principles generally accepted in the United
States of America and assumptions that affect the reported amounts of
assets and liabilities at the date of the financial statements. Actual
results could differ from those estimates.

U.S. GLOBAL LEADERS GROWTH FUND
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

NOTE 3 - COMMITMENTS AND OTHER RELATED
PARTY TRANSACTIONS

For the period ended December 31, 2001, Yeager, Wood & Marshall, Inc. (the
"Advisor") provided the Fund with investment management services under an
Investment Advisory Agreement. The Advisor furnished all investment advice,
office space, facilities and most of the personnel needed by the Fund. As
compensation for its services, the Advisor was entitled to a monthly fee at the
annual rate of 1.00% based upon the average daily net assets of the Fund. For
the period ended December 31, 2001, the Fund incurred $403,626 in advisory fees.

U.S. Bancorp Fund Services, LLC (the "Administrator") acts as the Fund's
Administrator under an Administration Agreement. The Administrator prepares
various federal and state regulatory filings, reports and returns for the Fund;
prepares reports and materials to be supplied to the trustees; monitors the
activities of the Fund's custodian, transfer agent and accountants; coordinates
the preparation and payment of Fund expenses and reviews the Fund's expense
accruals. For its services, the Administrator receives a monthly fee at the
following annual rate:

For the period ended December 31, 2001, the Fund incurred $72,825 in
administration fees.
U.S. Bank N.A., an affiliate of the Administrator, serves as custodian to
the Fund.
Quasar Distributors, LLC acts as the Fund's principal underwriter in a
continuous public offering of the Fund's shares. The Distributor is an affiliate
of the Administrator.
Certain officers and trustees of the Trust are also officers of the
Administrator.

U.S. GLOBAL LEADERS GROWTH FUND
NOTES TO FINANCIAL STATEMENTS (Unaudited) (Continued)

NOTE 4 - PURCHASES AND SALES OF SECURITIES
The cost of purchases and proceeds from the sale of securities, excluding
short-term investments, for the period ended December 31, 2001, were $3,721,263
and $2,805,627, respectively.

This page intentionally left blank.

ADVISOR
YEAGER, WOOD & MARSHALL, INCORPORATED
630 Fifth Avenue
New York, New York 10111
(212) 765-5350

DISTRIBUTOR
QUASAR DISTRIBUTORS, LLC
615 E. Michigan Street, 3rd Floor
Milwaukee, WI 53202

CUSTODIAN
U.S. BANK, N.A.
425 Walnut Street
Cincinnati, Ohio 45202

TRANSFER AND DIVIDEND DISBURSING AGENT
ORBITEX DATA SERVICES, INC.
P.O. Box 542007
Omaha, Nebraska 68154-1952

AUDITORS
ERNST & YOUNG LLP
725 South Figueroa Street
Los Angeles, California 90017

LEGAL COUNSEL
PAUL, HASTINGS, JANOFSKY & WALKER, LLP
55 Second Street, 24th Floor San
Francisco, California 94105-3441

This report is intended for the shareholders of the Fund and may not be used as
sales literature unless preceded or accompanied by a current prospectus.

PART C

OTHER INFORMATION

ITEM 15. INDEMNIFICATION

No change from the information set forth in Item 27 of the Registration
Statement of John Hancock Capital Series (the "Registrant") on Form N-1A under
the Securities Act of 1933 and the Investment company Act of 1940 (File Nos.
2-29502 and 811-1677), which information is incorporated herein by reference.

ITEM 16. EXHIBITS:

1 Registrant's Amended and Restated Filed as Exhibit 99.a to Registrant's
Declaration of Trust Registration Statement on Form N-1A and
incorporated herein by reference to
post-effective amendment no. 54 (file
nos. 811-1677 and 2-29502 on February 29,
2000; accession
no. 0001010521-00-000204)
("PEA 54 ")

1.1 Amendment to Declaration of Trust Filed as Exhibit 99.a.1 to PEA 54 and
incorporated herein by reference

1.2 Amendment to Declaration of Trust Filed as Exhibit 99.a.2 to Registrant's
Registration Statement on Form N-1A and
incorporated herein by reference to
post-effective amendment no. 58 (file
nos. 811-1677 and 2-29502 on December 28,
2001; accession no. 0001010521-01-500304)
("PEA 58")

1.3 Amendment to Declaration of Trust Filed herewith as Exhibit 1.

2 Amended and Restated By-Laws of Filed as Exhibit 99.b to Registrant's
Registrant Registration Statement on Form N-1A and
incorporated herein by reference to
post-effective amendment no. 48 (file
nos. 811-1677 and 2-29502 on February 27,
1997; accession
no. 0001010521-97-000229)
("PEA 48 ")

2.1 Amendment to Amended and Restated Filed herewith as Exhibit 2.
By-Laws of Registrant

3 Not applicable

4 Form of Agreement and Plan of Filed herewith as Exhibit A to the Proxy
reorganization Statement and Prospectus included as Part
A of this Registration Statement

5 Not applicable

6 Investment Management Contract Filed as Exhibit 99.d. to Registrant's
between Core Equity Fund and John Registration Statement on Form N-1A and
Hancock Advisers, LLC incorporated herein by reference to
post-effective amendment no. 52 (file
nos. 811-1677 and 2-29502 on February
22,1999; accession no.
0001010521-99-000135) ("PEA 52")

6.1 Sub-Investment Advisory Contract Filed as Exhibit 99.d.1 to PEA 48 and
between Core Equity Fund, incorporated herein by reference
Independence Investment LLC and John
Hancock Advisers, LLC

6.2 Form of Investment Management Filed as Exhibit 99.d.2 to Registrant's
Contract between John Hancock U.S. Registration Statement on Form N-1A and
Global Leaders Growth Fund and John incorporated herein by reference to
Hancock Advisers, LLC post-effective amendment no. 60 (file
nos. 811-1677 and 2-29502 on February
27,2002; accession no.
0001010521-02-000114) ("PEA 60")

6.3 Form of Sub-Investment Advisory Filed as Exhibit 99.d.3 to PEA 60 and
Contract between U.S. Global Leaders incorporated herein by reference
Growth Fund, Yeager, Wood & Marshall,
Inc. and John Hancock Advisers, LLC

7 Distribution Agreement between the Filed as Exhibit 99.e to Registrant's
Registrant and John Hancock Funds, Registration Statement on Form N-1A and
LLC. (formerly named John Hancock incorporated herein by reference to
Broker Distribution Services, Inc post-effective amendment no. 44 (file
nos. 811-1677 and 2-29502 on April 26,
1995; accession
no.0000950146-95-000180)
("PEA 44 ")

7.1 Amendment to Distribution Agreement Filed as Exhibit 99.e.1 to PEA 44 and
between the Registrant and John incorporated herein by reference
Hancock Funds, LLC

7.2 Form of Soliciting Dealer Agreement Filed as Exhibit 99.e.2 to PEA 52 and
between John Hancock Funds, LLC and incorporated herein by reference
Selected Dealers

7.3 Form of Financial Institution Sales Filed as Exhibit 99.e.3 to PEA 44 and
and Services Agreement incorporated herein by reference

7.4 Amendment to Distribution Agreement Filed as Exhibit 99.e.4 to PEA 48 and
between the Registrant and John incorporated herein by reference
Hancock Funds, LLC

8 Not applicable.

9 Master Custodian Agreement between Filed as Exhibit 99.g to PEA 58 and
John Hancock Mutual Funds (including incorporated herein by reference
Registrant) and The Bank of New York

10 Amended & Restate Master Transfer Filed as Exhibit 99.h to PEA 52 and
Agent Service Agreement between John incorporated herein by reference
Hancock Mutual Funds (including
Registrant) and John Hancock Funds,
LLC

10.1 Class A and Class B Distribution Filed as Exhibit 99.m to PEA 48 and
Plans between Registrant and John incorporated herein by reference
Hancock Funds, LLC

10.2 Class C Distribution Plans between Filed as Exhibit 99.m.1 to PEA 52 and
Registrant and John Hancock Funds, LLC incorporated herein by reference

10.3 John Hancock Funds Class A, Class B Filed as Exhibit 99.o to PEA 52 and
and Class C Amended and restated incorporated herein by reference
Multiple Class Plan pursuant to Rule
18f-3

10.4 John Hancock Funds Class A, Class B, Filed as Exhibit 99.p to PEA 53 and
Class C and Class I Amended and incorporated herein by reference
restated Multiple Class Plan pursuant
to
Rule 18f-3

10.5 Form of Class A Distribution Plan of Filed herewith as Exhibit 10.5.
John Hancock U.S. Global Leaders Fund

11 Opinion as to legality of shares and Filed herewith as Exhibit 14
consent

12 Form of opinion as to tax matters and Filed herewith as Exhibit 15
consent

13 Accounting and Legal Services Filed as Exhibit 99.h.1 to Registrant's
Agreement between John Hancock Registration Statement on Form N-1A and
Advisers, LLC and Registrant. incorporated herein by reference to
post-effective amendment no. 46 (file
nos. 811-1677 and 2-29502 on June 14,
1996; accession no. 0001010521-96-000095)
("PEA 46")

13.1 Amended and Restated Master Transfer Filed as Exhibit 99.h to PEA 52 and
Agent Service Agreement between John incorporated herein by reference
Hancock Mutual Funds (including
Registrant) and John Hancock Funds,
LLC

14 Consents of Ernst & Young LLP Filed herewith as Exhibit 17
regarding the audited financial
statements of U.S. Global Leaders Fund

15 Not applicable

16 Powers of Attorney Filed as addendum to signature pages and
incorporated herein by reference

17 Code of Ethics- John Hancock Funds, Filed as Exhibit 99.p to Registrant's
LLC and Independence Investment LLC Registration Statement on Form N-1A and
incorporated herein by reference to
post-effective amendment no. 55 (file
nos. 811-1677 and 2-29502 on June 14,
1996; accession no. 0001010521-00-000251)
("PEA 55")

ITEM 17. UNDERTAKINGS.

(1) The undersigned Registrant agrees that prior to any public reoffering of the
securities registered through the use of a prospectus which is part of this
registration statement by any person or party which is deemed to be an
underwriter within the meaning of Rule 145(c) under the Securities Act of 1933,
the reoffering prospectus will contain the information called for by the
applicable registration form for reofferings by persons who may be deemed
underwriters, in addition to the information called for by the other items of
the applicable form.

(2) The undersigned Registrant agrees that every prospectus that is filed under
paragraph (1) above will be filed as part of an amendment to the registration
statement and will not be used until the amendment is effective, and that, in
determining any liability under the Securities Act of 1933, each post-effective
amendment shall be deemed to be a new registration statement for the securities
offered therein, and the offering of the securities at that time shall be deemed
to be the initial bona fide offering of them.

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant has duly caused this Registration Statement on Form N-14 to be
signed on its behalf by the undersigned, duly authorized, in the City of Boston,
and Commonwealth of Massachusetts on the 7th day of March, 2002.

JOHN HANCOCK CAPITAL SERIES

By: *
--------------------------------------------

Maureen R. Ford
Chairman, President and Chief Executive Officer

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated.

Signature Title Date

* Trustee, Chairman and Chief
- ---------------------------
Maureen R. Ford Executive Officer

* Senior Vice President and
- ---------------------------
Richard A. Brown Chief Financial Officer

/s/William H. King Vice President, Treasurer March 7, 2002
- ---------------------------
William H. King (Chief Accounting Officer)

* Trustee
- ---------------------------
Dennis S. Aronowitz

* Trustee
- ---------------------------
Richard P. Chapman, Jr.

* Trustee
- ---------------------------
William J. Cosgrove

* Trustee
- ---------------------------
John M. DeCiccio

* Trustee
- ---------------------------
Richard A. Farrell

* Trustee
- ---------------------------
Gail D. Fosler

* Trustee
- ---------------------------
William F. Glavin

* Trustee
- ---------------------------
John A. Moore

* Trustee
- ---------------------------
Patti McGill Peterson

* Trustee
- ---------------------------
John W. Pratt

* By: /s/Susan S. Newton March 7, 2002
---------------------------
Susan S. Newton, Attorney-in-Fact,
under Powers of Attorney dated
June 23, 2001 and September 12, 2001.

Panel A
- -------
John Hancock Capital Series John Hancock Strategic Series
John Hancock Declaration Trust John Hancock Tax-Exempt Series Fund
John Hancock Income Securities Trust John Hancock World Fund
John Hancock Investors Trust John Hancock Investment Trust II
John Hancock Equity Trust John Hancock Investment Trust III
John Hancock Sovereign Bond Fund

Panel B
- -------
John Hancock Bank and Thrift Opportunity Fund John Hancock Patriot Global Dividend Fund
John Hancock Bond Trust John Hancock Patriot Preferred Dividend Fund
John Hancock California Tax-Free Income Fund John Hancock Patriot Premium Dividend Fund I
John Hancock Current Interest John Hancock Patriot Premium Dividend Fund II
John Hancock Institutional Series Trust John Hancock Patriot Select Dividend Trust
John Hancock Investment Trust John Hancock Series Trust
John Hancock Cash Reserve, Inc. John Hancock Tax-Free Bond Trust

POWER OF ATTORNEY
-----------------

The undersigned Officer of each of the above listed Trusts, each a
Massachusetts business trust, or Maryland Corporation, does hereby severally
constitute and appoint SUSAN S. NEWTON, WILLIAM H. KING, AND AVERY P. MAHER, and
each acting singly, to be my true, sufficient and lawful attorneys, with full
power to each of them, and each acting singly, to sign for me, in my name and in
the capacity indicated below, any Registration Statement on Form N-1A and any
Registration Statement on Form N-14 to be filed by the Trust under the
Investment Company Act of 1940, as amended (the "1940 Act"), and under the
Securities Act of 1933, as amended (the "1933 Act"), and any and all amendments
to said Registration Statements, with respect to the offering of shares and any
and all other documents and papers relating thereto, and generally to do all
such things in my name and on my behalf in the capacity indicated to enable the
Trust to comply with the 1940 Act and the 1933 Act, and all requirements of the
Securities and Exchange Commission thereunder, hereby ratifying and confirming
my signature as it may be signed by said attorneys or each of them to any such
Registration Statements and any and all amendments thereto.

IN WITNESS WHEREOF, I have hereunder set my hand on this Instrument as
of the 23rd day of June, 2001.

/s/Richard A. Brown
-------------------
Richard A. Brown
Chief Financial Officer

Commonwealth of Massachusetts )ss
- ----------------------------------------------------------
COUNTY OF Suffolk )
------------------------------------------------

Then personally appeared the above-named Richard A. Brown, who
acknowledged the foregoing instrument to be his free act and deed, before me,
this 23rd day of June, 2001.

/s/Erika L. Nager
-----------------
Notary Public

My Commission Expires: June 14, 2007
-------------

s:\general\prwattn\01June23.doc

John Hancock Capital Series John Hancock Strategic Series
John Hancock Declaration Trust John Hancock Tax-Exempt Series Fund
John Hancock Income Securities Trust John Hancock World Fund
John Hancock Investors Trust John Hancock Investment Trust II
John Hancock Equity Trust John Hancock Investment Trust III
John Hancock Sovereign Bond Fund

POWER OF ATTORNEY

The undersigned Trustee/Officer of each of the above listed Trusts,
each a Massachusetts business trust or Maryland corporation, does hereby
severally constitute and appoint Susan S. Newton, WILLIAM h. KING, and AVERY P.
MAHER, and each acting singly, to be my true, sufficient and lawful attorneys,
with full power to each of them, and each acting singly, to sign for me, in my
name and in the capacity indicated below, any Registration Statement on Form
N-1A and any Registration Statement on Form N-14 to be filed by the Trust under
the Investment Company Act of 1940, as amended (the "1940 Act"), and under the
Securities Act of 1933, as amended (the "1933 Act"), and any and all amendments
to said Registration Statements, with respect to the offering of shares and any
and all other documents and papers relating thereto, and generally to do all
such things in my name and on my behalf in the capacity indicated to enable the
Trust to comply with the 1940 Act and the 1933 Act, and all requirements of the
Securities and Exchange Commission thereunder, hereby ratifying and confirming
my signature as it may be signed by said attorneys or each of them to any such
Registration Statements and any and all amendments thereto.

IN WITNESS WHEREOF, I have hereunder set my hand on this Instrument as
of the 12th day of September, 2001.

/s/ Maureen R. Ford /s/Gail D. Fosler
- ------------------- -----------------
Maureen R. Ford, as Chairman and Chief Gail D. Fosler
Exective Officer

/s/John M. DeCiccio /s/William F. Glavin
- ------------------- --------------------
John M. DeCiccio, as Trustee William F. Glavin

/s/Dennis S. Aronowitz /s/John A. Moore
- ---------------------- ----------------
Dennis S. Aronowitz John A. Moore

/s/Richard P. Champman, Jr. /s/Patti McGill Peterson
- --------------------------- ------------------------
Richard P. Chapman, Jr. Patti McGill Peterson

/s/William J. Cosgrove /s/John W. Pratt
- ---------------------- ----------------
William J. Cosgrove John W. Pratt

/s/Richard A. Farell
- --------------------
Richard A. Farrell

COMMONWEALTH OF MASSACHIUSETTS)
- ------------------------------
)ss
COUNTY OF SUFFOLK )
- -----------------

Then personally appeared the above-named Richard A. Brown, who
acknowledged the foregoing instrument to be his free act and deed, before me,
this 23rd day of June, 2001.

/s/Erika Nager
--------------
Notary Public

My Commission Expires: June 14, 2007
-------------

s:\general\prwattn\01Sept12.doc

EXHIBIT INDEX

The following exhibits are filed as part of this Registration Statement:

Exhibit No. Description

1 Amendment to Declaration of Trust -Establishment and Designation of
New Series of Shares

2 Amendment to Amended and Restated By-Laws of Registrant

4 Agreement and Plan of Reorganization between the John Hancock U.S.
Global Leaders Growth Fund (the "Acquiring Fund") and U.S. Global
Leaders Growth Fund (the "Acquired Funds") (filed as EXHIBIT A to Part
A of this Registration Statement).

10.5 Form of Class A Distribution Plan

14 Opinion as to legality of shares and consent.

15 Form of opinion as to tax matters and consent.

17 Consent of Ernst & Young LLP regarding the audited financial statements
and highlights of the U.S. Global Leaders Growth Fund.