UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file
number 811-03888
Combined Penny Stock Fund, Inc.
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Exact name of registrant as specified in charter)
6180 Lehman Drive #103, Colorado Springs, CO 80918
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(Address of principal executive offices) (Zip code)
John R Overturf
6180 Lehman Dr #103
Colorado Springs, CO 80918
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(Name and address of agent for service)
Registrant's telephone number including area code:(719)593-2111
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Date of fiscal year end: 09/30
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Date of reporting period: 09/30/03
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection and policymaking roles. A registrant is required to disclose the
information specified by Form N-CSR, and the Commission will make this
information public. A registrant is not required to respond to the collection of
information contained in Form N-CSR unless the Form displays a currently valid
Office of Management and Budget ("OMB") control number.
Please direct comments concerning the accuracy of the information collection
burden estimate and any suggestions for reducing the burden to Secretary,
Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC
20549-0609. The OMB has reviewed this collection of information under the
clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS
1
Combined Penny Stock Fund, Inc.
2003 Annual Report
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The Company
Combined Penny Stock Fund, Inc. (the "Fund") is registered under the Investment
Company Act of 1940 as a closed-end investment company.
Shares of the Fund are bought and sold over-the-counter on the Bulletin Board
under the symbol "PENY". All, or nearly all, capital gains and dividends are
reinvested in the Fund.
To Our Shareholders;
The two year period since our last Annual Statement has been a difficult period
for all Combined stakeholders - its employees and shareholders alike. The Board
placed before the Shareholders a proxy that would have brought about substantial
changes to the Fund including a change of the name and investment policy.
Unfortunately, after several attempts, we were unsuccessful in our efforts as we
only received 43% of the votes needed to approve the proxy.
Subsequently, the Fund has reduced operating expenses to a bare minimum and has
converted a majority of the holdings to cash. We have also explored several
strategic alternatives to enhance shareholder value through the possible merger
or change in control of the Fund, but to no avail. In the near future we will
explore the alternative of liquidating the Fund and closing the doors.
The Board and I have been and continue to be committed to do the right thing -
to do what is best for the long term interests of the shareholders of Combined
Penny Stock Fund, Inc.
Thanks to our shareholders for their patience and continued support of the Fund.
Sincerely
John R. Overturf, Jr.
President
Combined Penny Stock Fund, Inc.
September 30, 2003
Corporate Information
Officers and Directors Stock Transfer Agent
John R. Overturf, Jr., President and Director Computershare Investor Services,
Dr. A. Leonard Nacht, Secretary and Director Inc.
Rolf L. Lichtenberg, Director P.O. Box 1596
Jeffrey J. Kormos, Director Denver, CO 80401
Corporate Headquarters Independent Auditors
Combined Penny Stock Fund, Inc. Ehrhardt Keefe Steiner & Hottman PC
6180 Lehman Drive, Suite 103 7979 E. Tufts Avenue, Suite 400
Colorado Springs, CO 80918-3415 Denver, CO 80237-2843
Custodian of Portfolio Securities Counsel
US Bank Neuman & Drennen LLC
1507 Pine Street
Boulder, CO 80302
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Independent Auditors' Report
To the Board of Directors and Shareholders
Combined Penny Stock Fund, Inc.
We have audited the statement of assets and liabilities in liquidation of
Combined Penny Stock Fund, Inc. including the schedule of investments in
unaffiliated issuers available for liquidation as of September 30, 2003, and the
related statement of operations in liquidation for the year then ended and
changes in net assets in liquidation, and the financial highlights for the years
ended September 30, 2003 and 2002. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits. The financial
statements of Combined Penny Stock Fund, Inc. prior to September 30, 2002, were
audited by other auditors whose report dated October 18, 2001, expressed an
unqualified opinion on those statements.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of
September 30, 2003, 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.
As described in Note 1 to the financial statements, during 2003, the Board of
Directors determined after being advised by legal council that the Company was
administratively dissolved, as a result of its failure to file its corporate
report and pay annual fees as required by C.R.S ss.7-114-201. The effective date
of the administrative dissolution was July 1, 2000. As a result of that
administrative dissolution, the corporate existence of the Company continued but
the corporation was not lawfully able to carry on business except such business
as is appropriate to wind up and liquidate its business and affairs in
accordance with applicable law. As a result, the Company changed its basis of
accounting for the periods after 2002 from the going concern basis to the
liquidation basis.
In our opinion, the financial statements referred to in the first paragraph
present fairly, in all material respects, the net assets in liquidation of
Combined Penny Stock Fund, Inc. as of September 30, 2003 and the results of its
operations for the year then ended and its changes in net assets in liquidation
and the financial highlights for the years ended September 30, 2003 and 2002 in
conformity with accounting principles generally accepted in the United States of
America applied on the basis of accounting described in the preceding paragraph.
Ehrhardt Keefe Steiner & Hottman, PC
Denver, Colorado
January 6, 2005
17
Statement of Assets and Liabilities in Liquidation as of September 30, 2003
Assets
Investments at liquidation value:
Investments in securities of unaffiliated issuers
(identified cost $1,487,496) $ 196,193
Cash and Equivalents 369,139
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Total Assets 565,332
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Liabilities Payables:
Accounts Payable 1,046
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Total Liabilities 1,046
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Contingencies
Net Assets in Liquidation $ 564,286
==========
Net Asset Value per Share $ .012
===========
Analysis of Net Assets
Common Stock, $.001 par value, 100,000,000 shares
authorized, 45,975,000 issued and outstanding $ 45,975
Additional paid-in capital 5,857,864
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Net capital paid in on shares of capital stock $5,903,839
===========
Accumulated Loss:
Net investment loss (3,560,556)
Accumulated realized loss (488,428)
Net unrealized depreciation of investments (1,290,569)
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Total accumulated loss (5,339,553)
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Net Assets in Liquidation $ 564,286
===========
See notes to financial statements
Schedule of Investments in Unaffiliated Issuers Available for Liquidation as of
September 30, 2003
Units,
Shares or
Warrants Value(a)
Common Stocks - 34.77%
Capital Foods - 0%
20,000 International Airline Support Group, Inc. $ 0
Communications - 8.98%
39,000 Legend Mobile, Inc. $ 7,020
1,600 L M Ericsson Telephone Company 23,520
9,000 CMGI, Inc. 13,932
5,000 MDU Communications, Int'l 3,650
793 Agere Systems, Inc. Class "B" 2,292
32 Agere Systems, Inc. Class "A" 97
5,682 Voice It Worldwide, Inc. - units 0
2,080 Worldcom, Inc. 135
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Group Subtotal: 50,646
Data Processing\Computer - 5.47%
6,000 Atmel Corporation $ 24,102
300 Palm, Inc. 5,799
10,000 Infotech, USA, Inc. 900
7,500 Prism Software Corporation 30
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Group Subtotal: 30,831
Electronics - 2.21%
10,000 Circuit Research Labs, Inc. $ 6,000
3,000 Lucent Technologies, Inc. 6,481
5,800 Surge Components, Inc. 0
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Group Subtotal: 12,481
Schedule of Investments in Unaffiliated Issuers Available for Liquidation as of
September 30, 2003
Units, Shares or
Warrants Value(a)
Common Stocks - 34.77% (Continued)
Entertainment - .56%
120,000 Global Casinos, Inc. (b) $ 2,100
60,210 Global Casinos, Inc. 1,054
13,000 IRV.com, Incorporated 39
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Group Subtotal 3,193
Finance - 0%
2,075 Milestone Capital, Inc. $ 8
2,500 Global Capital Partners, Inc. 0
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Group Subtotal: 8
Food & Beverage - 2.30%
50,000 Elephant and Castle Group, Inc. $ 13,000
185 Charlie O' Beverage, Inc. 0
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Group Subtotal: 13,000
Hobbies/Collectors - 3.23%
5,000 Collectors Universe, Inc. $ 18,250
Manufacturing - 4.36%
2,000 Concord Camera, Inc. $ 21,300
36,500 Veritec, Inc. 2,281
10,000 Luxor Industrial Corp. 684
800 Aura Systems, Inc. 49
600 Sooner Holdings 1
10,000 Grip Technologies, Inc. 0
417 Zapworld.com 277
135,000 Cable and Co. Worldwide, Inc. 0
3,333 Training Devices, Inc. (b) 0
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Group Subtotal: 24,592
Schedule of Investments in Unaffiliated Issuers Available for Liquidation as of
September 30, 2003
Units,
Shares or
Warrants Value(a)
Common Stocks - 34.77% (Continued)
Medical - 6.28%
70,000 Miracor Diagnostics, Inc. $ 18,900
5,000 Medical CV, Inc. 11,250
5,000 Medical CV, Inc. Wts 0
2,500 Siga Pharmaceuticals, Inc. 4,800
10,000 White Wing Labs, Inc. 500
4,900 Healthwatch, Inc. 0
65,000 Organic Solutions, Inc. 0
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Group Subtotal: 35,450
Mining - 1.38%
19,500 Globex Mining Enterprises, Inc. $ 7,742
800 Exprofuels, Inc. 0
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Group Subtotal: 7,742
Retail - 0%
928 Premier Concepts, Inc. $ 0
893 9A Investment Holding Corporation 0
4,000 House2Home, Inc. 0
27,000 ProductExpress.com eBusiness Services, Inc. 0
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Group Subtotal: 0
TOTAL COMMON STOCKS (Cost $1,487,496) $ 196,193
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Total Investments in Securities of Unaffiliated Issuers
(Cost $1,487,496) $ 196,193
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Total Investments in Securities of Unaffiliated 34.77% $ 196,193
Issuers (Cost $1,487,496)
Cash and Equivalents, Net of Liabilities 65.23% 368,093
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Net Assets 100.00% $ 564,286
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(a) See Notes 1 and 2 of notes to financial statements.
(b) Restricted security, see Note 2 of notes to financial statements.
See notes to financial statements
Statement of Operations in Liquidation for the Year Ended September 30, 2003
Investment Loss:
Interest income $ 4,810
Total income -------
4,810
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Expenses:
Salaries 51,672
Accounting services and administration 42,000
Reports to shareholders 24,750
Printing 11,679
Directors' fee 15,000
Audit 12,335
Office 9,383
Transfer agent 9,045
Legal 14,874
Custodian 2,082
Other 3,418
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Total expenses 196,238
Net Investment Loss Before Net Realized and
Unrealized Gain (Loss) on Investments (191,428)
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Net Realized and Unrealized Gain on Investments:
Net realized gain from investment transactions 11,822
Net unrealized appreciation of investments 63,856
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Net Gain on Investments 75,678
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Net Decrease in Net Assets from Operations in Liquidation $( 115,750)
============
Statements of Changes in Net Assets in Liquidation for the Years Ended
September 30, 2003 and 2002
2003 2002
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From Operations:
Net investment loss $ (191,428) $ (138,260)
Net realized gain from investment transactions 11,822 10,621
Net unrealized appreciation (depreciation) of
investments 63,856 (73,999)
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Net decrease in net assets from
operations in liquidation (115,750) (201,638)
From Capital Stock Transactions:
Purchase of treasury stock (667,000 and 2,374,000 shares
in 2003 and 2002, respectively) (8,705) (37,999)
Net Assets in Liquidation - beginning of period 688,741 928,378
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Net Assets in Liquidation - end of period $ 564,286 $ 688,741
========== ==========
See notes to financial statements
Financial Highlights
For the Years Ended
September 30,
2003 2002 2001 2000 1999
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Per Share:
Income from investments $ .000 $ .000 $ .001 $.001 $ .001
Expenses (.004) (.003) (.003) (.003) (.003)
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Net investment loss (.004) (.003) (.002) (.002) (.002)
Net realized gain and
unrealized appreciation
(depreciation) of
investments .001 (.001) (.007) .004 .008
------- ------- ------- ------ ------
Net increase (decrease) in
net asset value (.003) (.004) (.009) .002 .006
Net Asset Value:
Beginning of year .015 .019 .028 .026 .020
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End of year $ .012 $ .015 $ .019 $ .028 $ .026
======= ======= ======= ======= ========
Total investment
return (1) (20.00)% (21.05)% (32.14)% 7.69% (30.00)%
Ratios:
Expenses to average net
assets 31.44% 17.42% 12.24% 11.81% 10.74%
Net investment loss to
average net assets 30.67% 15.79% 8.69% 7.25% 7.03%
Portfolio turnover
rate (2) 00.00% 35.57% 114.47% 95.72% 33.00%
(1) Based on the change in net asset value considering there have been no
distributions during the period presented. The Fund does not believe that a
presentation based on changes in the market value of the Fund's common stock is
appropriate considering the limited market for the Fund's stock.
(2) The lesser of purchases or sales of portfolio securities for a period
divided by the monthly average of the market value of portfolio securities owned
during the period. Securities with a maturity or expiration date at the time of
acquisition of one year or less are excluded from the calculation. Purchases and
sales of investment securities for the year ended September 30, 2003 were $0 and
$34,126, respectively.
See notes to financial statements
Notes to Financial Statements
1. Summary of Significant Accounting Policies
Combined Penny Stock Fund, Inc. (the Fund) was incorporated September 7, 1983
and is registered under the Investment Company Act of 1940, as amended, as a
closed-end investment company. The Fund has investments in a broad range of
small, speculative stocks traded in the over-the-counter market and is being
managed by the Board of Directors of the Fund.
Securities and Exchange Commission Examination and Liquidation Basis of
Accounting
Pursuant to an examination of the Fund by the Securities and Exchange Commission
(SEC), the SEC has issued a letter to the Fund identifying various asserted
deficiencies and violations of rules and regulations. The Fund has responded to
the SEC and does not believe that the outcome of this matter will have a
material impact on the Fund's financial condition or operations beyond the
liquidation of its assets. However, the ultimate outcome of this matter is not
determinable at this time.
During 2003, the Board of Directors determined after being advised by legal
council that the Company was administratively dissolved, as a result of its
failure to file its corporate report and pay annual fees as required by C.R.S
ss.7-114-201. The effective date of the administrative dissolution was July 1,
2000. As a result of that administrative dissolution, the corporate existence of
the Company continued but the corporation was not lawfully able to carry on
business except such business as is appropriate to wind up and liquidate its
business and affairs in accordance with applicable law. The Company has been
engaged in such process of converting all of its assets to cash for the purpose
of doing a liquidating distribution to its shareholders. The actions are
appropriate and authorized under applicable law notwithstanding the Company's
administrative dissolution. The Board of Directors believes the Company has
complied with all laws and regulations relating to becoming administratively
dissolved, however, if there were violations unknown to the Board of Directors,
the impact, if any, on the accompanying financial statements cannot be
determined at this time.
Basis of Accounting - As a result of the administrative dissolution described
above, the Company changed its basis of accounting for the periods after 2002
from the going concern basis to the liquidation basis which had no material
impact on the accompanying financial statements.
Investment Valuation - Investments in securities traded on national exchanges
and NASDAQ are valued at last reported sales prices. Investments in securities
traded in the over-the-counter market on the Electronic Bulletin Board or Pink
Sheets are valued at the quoted bid as obtained from NASDAQ or at the quoted bid
prices from the brokers that make markets in such securities, on the last
business day of the period. Investments in restricted securities, as well as
certain thinly-traded securities and corporate notes, are valued at their fair
value as determined by management and the Board of Directors.
Federal Income Taxes - The Fund has not elected to be treated for Federal income
tax purposes as a "regulated investment company" under Subchapter M of the
Internal Revenue Code. Consequently, investment income and realized capital
gains are taxed to the Fund at tax rates applicable to corporations.
The Fund accounts for income taxes in accordance with the Statement of Financial
Accounting Standards (SFAS) No. 109, "Accounting for Income Taxes." Under SFAS
No. 109, a current or deferred income tax liability or asset is recognized for
timing differences, which exist in the recognition of certain income and expense
items for financial statement reporting purposes in periods different than for
income tax reporting purposes.
Other - Investment transactions are accounted for on the date the investments
are purchased or sold (trade date). Realized gains and losses from investment
transactions and unrealized appreciation and depreciation of investments are
reported on a first-in, first-out basis. All of the Fund's equity securities as
of September 30, 2003 are non-income producing securities.
Notes to Financial Statements (continued)
1. Summary of Significant Accounting Policies (continued)
Concentration of Cash - As of September 30, 2003, the Fund had a money market
deposit at a bank of $362,000, which is in excess of the federally insured limit
by approximately $262,000.
Use of Estimates - The preparation of the Fund's financial statements in
conformity with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the reported amounts
of income and expenses during the reporting period. Actual results could differ
from those estimates.
2. Restricted and Thinly-Traded Securities
Restricted securities are those securities, which have been acquired from an
issuer without registration under the Securities Act of 1933. Restricted
securities generally cannot be sold by the Fund except pursuant to an effective
registration statement or in compliance with Rule 144 of the Securities Act of
1933. The following schedule provides certain information with respect to
restricted securities held by the Fund as of September 30, 2003. These
securities comprised .37% of the Fund's net assets at such time.
Description Date of Acquisition Cost Value
Training Devices, Inc. February 20, 1997 $ 12,500 $ 0
Global Casinos, Inc. August 1, 2001 $ 59,800 $ 2,100
The Fund has no right to require registration of the above-restricted
securities.
Valuations for the restricted securities, as well as certain thinly-traded
securities and corporate notes, have been determined in good faith by the Fund's
Board of Directors, in the absence of readily ascertainable market values. Such
investments were valued at $23,909 as of September 30, 2003, representing 4.24%
of the Fund's net assets. Because of the inherent subjectivity of these
valuations, it is reasonably possible that a material change in such valuations
could occur in the near term.
3. Unrealized Gains and Losses
At September 30, 2003, the net unrealized depreciation of investments of
$1,290,569 was comprised of gross appreciation of $19,679 for those investments
having an excess of value over cost and gross depreciation of $1,310,248 for
those investments having an excess of cost over value.
4. Income Taxes
There is no income tax provision in 2003 as the deferred tax assets relating to
accumulated losses and unrealized depreciation of approximately $893,000
continue to be fully reserved. The deferred tax assets and related valuation
allowance each increased $39,000 during the year ended September 30, 2003 due to
the increase in unrealized depreciation. Accumulated net investment loss
carryovers for income tax purposes total approximately $1,337,000 at September
30, 2003, and will expire in varying amounts through 2008.
5. Subsequent Event
During the year ended September 30, 2004, the Company sold most of its
investments resulting in a net gain on investments of $66,521. Investments
remaining as of September 30, 2004 were valued at zero.
End of notes to financial statements
PRSRT STD
U.S. POSTAGE
PAID
Co. Spgs., CO
Permit No. 440
Combined Penny Stock Fund, Inc.
6180 Lehman Drive, Suite 103
Colorado Springs, Colorado 80918-3415
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ITEM 2. CODE OF ETHICS
(a)The Registrant, as of the end of the period covered by this report, has
adopted a code of ethics that applies to the Registrant's principal executive
officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions, regardless of whether these
individuals are employed by the Registrant or a third party.
(b)There have been no amendments, during the period covered by this report, to a
provision of the code of ethics that applies to the Registrants principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions, regardless of whether these
individuals are employed by the Registrant or a third party, and that relates to
any element of the code of ethics description.
(c)The Registrant has not granted any waivers, including an implicit waiver,
from a provision of the code of ethics that applies to the Registrants principal
executive officer, principal financial officer, principal accounting officer or
controller, or persons performing similar functions, regardless of whether these
individuals are employed by the Registrant or a third party, that relates to one
or more of the items set forth in paragraph (b) of this item's instructions.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a)(1)The Registrant does not have an audit committee financial expert serving
on its audit committee.
(a)(2)Not applicable.
(a)(3)The Fund is not in a financial position to attract or compensate a person
who qualifies as an audit committee expert. At a minimum an expert would require
reasonable compensation and protection under a director and officer liability
insurance policy.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) AUDIT FEES: The aggregate fees billed for each of the last two fiscal years
for professional services rendered by the principal accountant for the audit of
the registrant annual financial statements or services that are normally
provided by the accountant in connection with statutory and regulatory filings
or engagements for those fiscal years are $11,665 in 2002 and $7,500 in 2003.
(b) AUDIT-RELATED FEES: The aggregate fees billed in each of the last two fiscal
years for assurance and related services by the principal accountant that are
reasonably related to the performance of the audit of the registrant financial
statements and are not reported under paragraph (a) of this Item are NONE.
(c) TAX FEES: The aggregate fees billed in each of the last two fiscal years for
professional services rendered by the principal accountant for tax compliance,
tax advice, and tax planning are $670 in 2002 and $0 in 2003. Tax Fees
represent tax compliance services and tax consultation provided in connection
with the preparation of the Registrants federal income tax and excise tax
returns and compliance with IRS regulations.
(d) ALL OTHER FEES: The aggregate fees billed in each of the last two fiscal
years for products and services provided by the principal accountant, other than
the services reported in paragraphs (a) through (c) of this Item are NONE.
(e)(1) Disclose the audit committee pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X. Audit Committee
Pre-Approval Policy. All services to be performed for the Registrant by Ehrhardt
Keefe Steiner & Hottman, PC must be pre-approved by the board of directors that
act as the audit committee. All services performed during 2002 and 2003 were
pre-approved by the board.
(e)(2) The percentage of services described in each of paragraphs (b) through
(d) of this Item that were approved by the audit committee pursuant to paragraph
(c)(7)(i)(C) of Rule 2-01 of Regulation S-X are as follows:
(b) Not applicable
(c) 0%
(d) Not applicable
(f) The percentage of hours expended on the principal accountants engagement to
audit the registrants financial statements for the most recent fiscal year that
were attributed to work performed by persons other than the principal
accountants full-time, permanent employees was NONE.
(g) The aggregate non-audit fees billed by the registrants accountant for
services rendered to the registrant, and rendered to the registrants investment
adviser (not including any sub-adviser whose role is primarily portfolio
management and is subcontracted with or overseen by another investment adviser),
and any entity controlling, controlled by, or under common control with the
adviser that provides ongoing services to the registrant for each of the last
two fiscal years of the registrant was NONE in 2002 and NONE in 2003.
(h) The registrants audit committee of the board of directors has considered
whether the provision of non-audit services that were rendered to the
registrants investment adviser (not including any sub-adviser whose role is
primarily portfolio management and is subcontracted with or overseen by another
investment adviser), and any entity controlling, controlled by, or under common
control with the investment adviser that provides ongoing services to the
registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X is compatible with maintaining the principal accountants
independence.
ITEM 5. AUDIT COMMITTEE OF LISTED COMPANIES. Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS. Schedule filed with Item 1.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END FUNDS.
All proxy voting decisions is done by the majority vote of the board.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END FUNDS.
All purchase decisions of equity securities is done by the majority vote
of the board.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
All decisions to submit matters to a vote of security holders is done by the
majority vote of the board.
ITEM 10. CONTROLS AND PROCEDURES. (a) Based on an evaluation of the registrant's
disclosure controls and procedures within 90 days of filing date of this Form
N-CSR, the disclosure controls and procedures are reasonably designed to ensure
that the information required in filings on Forms N-CSR is recorded, processed,
summarized, and reported on a timely basis. (b) There were no significant
changes in the registrant's internal control over financial reporting that
occurred during the registrant's last fiscal half-year that have materially
affected, or are reasonably likely to materially affect, the registrant's
internal control over financial reporting.
ITEM 11. EXHIBITS.
(a)(1) Not Applicable
(a)(2) Certifications by the registrant's principal executive officer and
principal financial officer, pursuant to Section 302 of the Sarbanes- Oxley Act
of 2002 and required by Rule 30a-2under the Investment Company Act of 1940 are
filed herewith.
(a)(3)Not Applicable
(b) Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 is filed herewith.
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934
and the Investment Company Act of 1940, the registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Combined Penny Stock Fund, Inc. By * /s/ John R Overturf
John R Overturf, President Date 03/02/05
- ---------------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By * /s/ John R Overturf
John R Overturf, President Date 03/02/05
- ---------------------------------------------------------------------------
Fund Directors
Name, Positions Term of Office Principal Number of Other
Address Held with and Length of Occupation(s) Portfolios Director
and Age Fund time served during the in Fund ships
*see(1) *see(2)below past 5 years Complex held
below Overseen for
By each
Director officer
Or or
Nominee nominee
*see (3) for
below Director
- -------- -------- -------------- ------------------- ---------- --------
John R. Overturf*(42) President, Mr. Overturf serves as President
6180 Lehman Dr 103 since of the Combined Penny Stock Fund,
Colorado Springs, August 1996 Inc., a closed-end stock fund, a
Colorado 80918 Director position he has since August 1996.
From March From September 1993 until September
1996 1996, Mr. Overturf served as Vice-
President of the Rockies Fund, Inc.
A closed-end stock market fund. Mr.
Overturf serves as the President
Of R.O.I., Inc., a private
Investment company, a position he
Has held since 1993. From June 1984
until February 1992, Mr. Overturf
served as Vice-President of Colorado
National Bank. Mr. Overturf holds a
Bachelor of Science degree in
Finance from the University of
Northern Colorado. Mr. Overturf
also is a director of BioSource
International, Inc. a California
Corporation.
A. Leonard Nacht*(74) Secretary From April 1990 to October 1991,
P.O. Box 1679 since April Dr. Nacht was Secretary of Redwood
Edwards, CO 81632 1990 MicroCap Fund, Inc. ("RWCF"). From
Director 1957 to 1994, Dr. Nacht was in the
since private practice of denistry. Dr.
February Nacht is currently retired as a
1990 dentist. Dr. Nacht has a DDS degree
from the University of Washington
and is a member of the American and
Colorado Dental Asociations.
Jeffrey J. Kormos (62) Director From August, 2001 until present, Mr.
8751 N 51st Ave 115 since Kormos has been employed as an
Glendale, Az 85302 July 1997 account executive with Samco
Financial Services, Inc. From
August 1994 to August 2002, he was
employed as an account executive
with Yee, Desmond, Schroeder & Allen
Inc., an NASD member stockbrokerage
firm. From March 1993 to August
1994, he was employed as an account
executive with G. R. Stuart &
Company, Inc. From December 1992 to
March 1993, Mr. Kormos was employed
as an account executive with
Financial Securities Network, Inc.,
and from April 1987 to December 1992
he was employed as an account
executive with Affiliated Securities
Rolf L. Lichtenberg (54)Director Mr. Lichtenberg joined the Portland
956 SE Ankeny St. #1 since staff of Cascadia Revolving Fund in
Portland, OR 97214 August October 2000. Cascadia is a private
2002 non-profit community development financial
institution making loans and providing
technical assistance to small businesses
unable to access credit from traditional
sources. From 1998 to the summer of 2000 He
worked in the Mortgage Loan Department of
Vectra Bank of Colorado in Colorado Springs.
His background consists of seventeen years of
banking knowledge including 12 years as a
commercial lender, loan department head and
branch manager. Mr. Lichtenberg's lending
background began at Security Pacific Bank's
Los Angeles headquarters and continued at
banks in Washington DC, Canada and Colorado.
He also spent five years as a small business
owner/manager in Colorado and several years
as an account executive in the securities
industry. Mr. Lichtenberg received Master of
Business Administration from the University
of Colorado in Boulder in 1976 and a
Bachelor's Degree in Finance also from the
University of Colorado in 1974. He has served
as the president of the Colorado Springs
chapter of the National Kidney Foundation and
as treasurer of the Chamber of Commerce in
Fountain, Colorado.
* Mr. Overturf and Dr. Nacht may be deemed interested persons as that term is
defined under Section 2(a)(19) of the Investment Company Act of 1940, as
amended, by virtue of their being officers as well as directors of the Fund.
The Fund Statement of Additional Information includes additional information
about Fund directors and is available by calling the Fund's phone number, at
719-593-2111.
A description of the policies and procedures that the Fund uses to determine how
to vote proxies relating to portfolio securities is available calling the Fund
phone number, (719-593-2111.
The Fund has adopted a code of ethics applicable to its principal executive
officer and principal financial officer. A copy of this code is available by
calling the Fund phone number, (719)593-2111.
Combined Penny Stock Fund, Inc
6180 Lehman Drive, Suite 103
Colorado Springs, CO 80918
Phone: (719) 593-2111
Fax: (719) 593-2342
Board of Directors
John R. Overturf
A. Leonard Nacht
Jeffrey J. Kormos
Rolf L. Lichtenberg
Officers
John R Overturf, President
A. Leonard Nacht, Secretary