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 811-09096
Ameriprime Funds
(Exact name of registrant as specified in charter)
431 N. Pennsylvania St. Indianapolis, IN 46204
(Address of principal executive offices) (Zip code)
Timothy Ashburn Unified Fund Services 431 N. Pennsylvania St
Indianapolis, IN 46204
(Name and address of agent for service)
Registrant's telephone number, including area code: 317-917-7000
Date of fiscal year end: 12/31
Date of reporting period: 12/31/02
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. 3507.
<page>
Item 1. Reports to Stockholders.
GJMB Growth Fund
Returns for the Periods Ended December 31, 2002
3 Year Total Average Annual
Fund/Index 1 Year Annualized Return Since Inception
(December 31, 1998)
---------- --------- ---------- ------------------
GJMB Growth Fund -14.70% -11.76% -3.61%
S&P 500 Index -22.12% -14.55% -6.76%
The return information and the chart below do not reflect deduction of any
sales loads. On February 13, 2003, the Board voted to discontinue the sales load
on the Fund. There had been no sales load imposed on Fund share purchases since
its establishment.
GJMB S&P
12/31/98 10,000.00 10,000.00
6/30/99 11,020.00 11,238.00
12/31/99 12,588.84 12,104.00
6/30/00 12,739.69 12,052.35
12/31/00 11,421.72 11,002.29
6/30/01 10,422.19 10,265.58
12/31/01 10,117.10 9,695.67
6/30/02 9,101.20 8,417.83
12/31/02 8,629.90 7,551.27
The above chart shows the value of a hypothetical initial investment of
$10,000 in the Fund and the S&P 500 Index on December 31, 1998 and held through
December 31, 2002. The S&P 500 Index is a widely recognized unmanaged index of
common stock prices. The Index returns do not reflect expenses, which have been
deducted from the Fund's return. These performance figures include the change in
value of the stocks in the indices plus the reinvestment of dividends. Shares,
when redeemed, may be worth more or less than their original cost. The Fund may
experience greater risks and price fluctuations due to its concentration in a
single sector as is noted in the Fund's prospectus. The returns shown do not
reflect deduction of taxes that a shareholder would pay on Fund distributions or
the redemption of Fund shares.
THE FUND'S RETURN REPRESENTS PAST PERFORMANCE AND IS NOT PREDICTIVE OF
FUTURE RESULTS.
For a prospectus and more information, including charges and expenses call
1-888-912-4562. The prospectus should be read carefully before investing. The
Fund's inception date is December 31, 1998. Distributed by Unified Financial
Securities, Inc.
Industry Sector Weightings* Ten Largest Equity Holdings*
(as of December 31, 2002) (as of December 31, 2002)
Energy 7.1% Kimberly-Clark 4.6%
Industrials 9.5% Coca-Cola 4.6%
Consumer Discretionary 9.7% Home Depot 4.4%
Consumer Staples 12.5% ChevronTexaco 3.9%
Health Care 6.1% Philip Morris 3.3%
Financials 6.4% Honeywell Intl 3.3%
Information Technology 8.0% Royal Dutch Petroleum 3.2%
Telecomm Services 2.6% Boeing 3.1%
Cash Equivalents 38.1% General Electric 3.1%
Costco Wholesale 3.0%
Total 100.0% Total 36.5%
* Weightings and Holdings are subject to change
Management's Discussion & Analysis
Dear Fellow Shareholders:
As we close the books on 2002, we are certainly pleased with the Fund's
performance relative to the major market benchmarks. However, three consecutive
years of negative investment results, no matter how good they are on a
"relative" basis, can put a strain on any investor's patience. We believe that
it is important to point out that throughout much of 2002 we maintained a
cautious stance with the Fund's portfolio in order to preserve capital to the
greatest extent possible and, at times, it wasn't uncommon to see the Fund's
cash level at 35% to 40%. In fact, year end being one of those times, you will
note that the Fund's cash balance was just over 38% of its total assets. We
certainly credit this proactive asset allocation strategy with a significant
portion of the Fund's superior results relative to the returns of the Standard &
Poor 500 Index in 2002. We should make it clear, however, that it is by no means
a shift in our policy to maintain these high cash levels. As stated in the
Fund's prospectus, "the Fund may take temporary defensive positions that are
inconsistent with the Fund's principal investment strategies in an attempt to
respond to adverse market, economic, political, or other conditions". Given the
extent of the adverse conditions affecting the current market, our "temporary"
strategies have been in place longer than any of us could have anticipated a
year or more ago.
During 2002, the market reacted negatively to the accounting scandals early
in the year, which seemed to crop up almost daily, and then later in the year
the market headed still lower on continued weak economic data, long after all of
the prognosticators believed that the economic recovery would be underway. A 13%
gain from the market's October lows through year-end however, gave many
investors hope that the worst may be behind us. We certainly are of this camp,
however we feel that the continued economic uncertainty, which exists as we
enter 2003, puts us in a position where the market could potentially revisit the
October levels before it heads significantly higher. So while we entered a new
fiscal year with a significant cash allocation, it is certainly our objective to
bring the Fund to a fully invested level as soon as prudently possible.
We appreciate your continued confidence and patience in our investment
strategy and look forward to hopefully reporting to your on our successes in our
next annual report.
Best regards,
Gary A. Pulford
Fund Portfolio Manager
Principal - Gamble, Jones, Morphy & Bent
<page>
GJMB Growth Fund
Schedule of Investments
December 31, 2002
<table>
<s> <c> <c>
Common Stocks - 61.8% Shares Value
Aircraft - 3.1%
Boeing Co. 10,500 $ 346,395
---------------
Auto Controls for Regulating Residential & Commercial Environment - 3.3%
Honeywell International, Inc. 15,000 360,000
---------------
Beverages - 4.6%
Coca-Cola Co. 11,500 503,930
---------------
Cable & Other Pay Television Services - 0.7%
Comcast Corp. Class A (a) 3,396 80,044
---------------
Cigarettes - 3.3%
Philip Morris Companies, Inc. 9,000 364,770
---------------
Electronic & Other Electrical Equipment (No Computer Equipment) - 3.1%
General Electric Co. 14,000 340,900
---------------
Fire, Marine & Casualty Insurance - 1.8%
American International Group, Inc. 3,500 202,475
---------------
National Commercial Banks - 4.5%
Citigroup, Inc. 7,500 263,925
U.S. Bancorp 11,000 233,420
---------------
497,345
---------------
Oil & Gas - 3.2%
Royal Dutch Petroleum Co. ADR 8,000 352,160
---------------
Paper Mills - 4.6%
Kimberly-Clark Corp. 10,800 512,676
---------------
Petroleum Refining - 3.9%
ChevronTexaco Corp. 6,500 432,120
---------------
Pharmaceutical Preparations - 6.1%
Bristol-Myers Squibb, Inc. 9,500 219,925
Merck & Co., Inc. 4,000 226,440
Pfizer, Inc. 7,500 229,275
---------------
675,640
---------------
Radio & TV Broadcasting & Communications Equipment - 1.5%
Motorola, Inc. 19,000 164,350
---------------
Retail - Lumber & Other Building Materials Dealers - 4.5%
The Home Depot, Inc. 20,500 491,180
---------------
Retail - Variety Stores - 3.0%
Costco Wholesale Corp. (a) 12,000 336,720
---------------
Semiconductors & Related Devices - 3.1%
Intel Corp. 12,500 194,625
Texas Instruments, Inc. 10,000 150,100
---------------
344,725
---------------
Services - Miscellaneous Amusement & Recreation - 2.2%
Walt Disney Co. 15,000 244,650
---------------
Services - Prepackaged Software - 3.4%
Microsoft Corp. (a) 3,000 155,100
Oracle Corp. (a) 20,000 216,000
---------------
371,100
---------------
Telephone Communications (No Radiotelephone) - 1.9%
AT&T Corp. 2,100 54,831
Verizon Communications, Inc. 4,000 155,000
---------------
209,831
---------------
TOTAL COMMON STOCKS (Cost $7,711,832) 6,831,011
---------------
Money Market Securities - 38.1%
Huntington Money Market Fund, Class A, 0.38%, (Cost $4,208,757) (b) 4,208,757 4,208,757
---------------
TOTAL INVESTMENTS (Cost $11,920,589) - 99.9% $ 11,039,768
---------------
Other assets less liabilities - 0.1% 8,804
---------------
TOTAL NET ASSETS - 100.0% $ 11,048,572
===============
</table>
(a) Non-income producing.
(b) Variable rate security; the coupon rate shown represents the yield at
December 31, 2002. <page>
GJMB Growth Fund
Statement of Assets & Liabilities
December 31, 2002
<table>
<s> <c>
Assets
Investment in securities (cost $11,920,589) $ 11,039,768
Dividends receivable 20,799
Interest receivable 1,695
Receivable for fund shares sold 923
-----------------------
Total assets 11,063,185
-----------------------
Liabilities
Accrued investment advisory fee $ 11,593
Payable for fund shares redeemed 3,020
-----------------------
Total liabilities 14,613
-----------------------
Net Assets $ 11,048,572
=======================
Net Assets consist of:
Paid in capital $ 14,807,517
Accumulated undistributed net investment income 27,907
Accumulated net realized loss on investments (2,906,031)
Net unrealized depreciation on investments (880,821)
-----------------------
Net Assets, for 1,340,731 shares $ 11,048,572
=======================
Net Asset Value
Net Asset Value and redemption price per share ($11,048,572/1,340,731) $ 8.24
=======================
Maximum offering price per share ($8.24 / .9525) $ 8.65
=======================
</table>
<page>
GJMB Growth Fund
Statement of Operations
Year ended December 31, 2002
<table>
<s> <c>
Investment Income
Dividend income $ 140,559
Interest income 28,057
-----------------
Total Income 168,616
-----------------
Expenses
Investment advisor fee 140,601
Trustee expenses 2,674
Miscellaneous expenses 108
-----------------
Total Expenses 143,383
Reimbursed expenses (2,674)
-----------------
Total operating expenses 140,709
-----------------
Net Investment Income (Loss) 27,907
-----------------
Realized & Unrealized Gain (Loss)
Net realized gain (loss) on investment securities (2,180,318)
Change in net unrealized appreciation (depreciation)
on investment securities 147,063
-----------------
Net realized and unrealized gain (loss) on investment securities (2,033,255)
-----------------
Net increase (decrease) in net assets resulting from operations $ (2,005,348)
=================
</table>
<page>
GJMB Growth Fund
Statement of Changes In Net Assets
<table>
<s> <c> <c>
Year ended Period ended
Increase (Decrease) in Net Assets Dec. 31, 2002 December 31, 2001 (a)
----------------- -----------------------
Operations
Net investment income (loss) $ 27,907 $ 16,230
Net realized gain (loss) on investment securities (2,180,318) (689,364)
Change in net unrealized appreciation (depreciation) 147,063 280,375
----------------- -----------------------
Net increase (decrease) in net assets resulting from operations (2,005,348) (392,759)
----------------- -----------------------
Distributions
From net investment income - (55,707)
From net realized gain - (13,468)
----------------- ----------------------
Total distributions - (69,175)
----------------- -----------------------
Capital Share Transactions
Proceeds from shares sold 4,108,253 259,944
Reinvestment of distributions - 68,431
Amount paid for shares repurchased (3,062,150) (555,291)
----------------- -----------------------
Net increase (decrease) in net assets
resulting
from share transactions 1,046,103 (226,916)
----------------- ----------------------
Total Increase (Decrease) in Net Assets (959,245) (688,850)
----------------- -----------------------
Net Assets
Beginning of period 12,007,817 12,696,667
----------------- -----------------------
End of period [including accumulated undistributed net
investment income of $27,907 and $0, respectively] $ 11,048,572 $ 12,007,817
================= =======================
Capital Share Transactions
Shares sold 454,427 26,914
Shares issued in reinvestment of
distributions - 7,143
Shares repurchased (357,018) (58,963)
----------------- -----------------------
Net increase (decrease) from capital transactions 97,409 (24,906)
================= =======================
</table>
(a) The Fund elected to change its fiscal year to December 31. The figures shown
are for the short year (July 1, 2001 through December 31, 2001).
<page>
GJMB Growth Fund
Financial Highlights
<table>
<s> <c> <c> <c> <c> <c>
Year ended Period ended Year ended Year ended Period ended
Dec. 31, Dec. 31, June 30,
June 30, June 30, 2002
2001 (d) J 2001 2000
1999 (a)
----------- ------------ ----------- ------------ --------------
Selected Per Share Data
Net asset value, beginning of period $ 9.66 $ 10.01 $ 12.68 $ 11.02 $ 10.00
----------- ------------ ----------- ------------ --------------
Income from investment operations
Net investment income (loss) 0.02 0.01 0.05 0.05 0.02
Net realized and unrealized gain (loss) (1.44) (0.30) (2.33) 1.67 1.00
----------- ----------- ----------- ------------ --------------
Total from investment operations (1.42) (0.29) (2.28) 1.72 1.02
--------- ------------ ----------- ------------ --------------
Less Distributions to shareholders:
From net investment income 0.00 (0.05) (0.05) (0.02) 0.00
From net realized gain 0.00 (0.01) (0.34) (0.04) 0.00
----------- ----------- ----------- ------------ --------------
Total distributions 0.00 (0.06) (0.39) (0.06) 0.00
----------- ------------ ----------- ------------ --------------
Net asset value, end of period $ 8.24 $ 9.66 $ 10.01 $ 12.68 $ 11.02
=========== ============ =========== ============ ==============
Total Return (14.70)% (2.93)%(c) (18.19)% 15.61% 10.20%(c)
Ratios and Supplemental Data
Net assets, end of period (000) $ 11,049 $12,008 $12,697 $12,967 $6,502
Ratio of expenses to average net assets 1.20% 1.20%(b) 1.20% 1.20% 1.20%(b)
Ratio of expenses to average net assets
before waiver & reimbursement 1.22% 1.22%(b) 1.23% 1.22% 1.25%(b)
Ratio of net investment income to
average net assets 0.24% 0.27%(b) 0.40% 0.40% 0.34%(b)
Ratio of net investment income to
average net assets before waiver
& reimbursement 0.22% 0.25%(b) 0.38% 0.38% 0.28%(b)
Portfolio turnover rate 115.69% 40.72% 59.92% 16.99% 24.26%
</table>
(a) December 31, 1998 (commencement of operations) to June 30, 1999. (b)
Annualized (c) For a period of less than a full year, the total return is
not annualized.
(d) The Fund elected to change its fiscal year to December 31. The figures shown
are for the short year
(July 1, 2001 through December 31, 2001).
<page>
GJMB Growth Fund
Notes to Financial Statements
December 31, 2002
NOTE 1. ORGANIZATION
GJMB Growth Fund (the "Fund") was organized as a non-diversified series of
the AmeriPrime Funds (the "Trust") on October 22, 1998 and commenced operations
on December 31, 1998. The Trust is established under the laws of Ohio by an
Agreement and Declaration of Trust dated August 8, 1995 (the "Trust Agreement").
The Trust Agreement permits the Board of Trustees to issue an unlimited number
of shares of beneficial interest of separate series without par value. The Fund
is one of a series of funds currently authorized by the Board of Trustees. The
Fund's investment objective is to provide long term capital appreciation. The
investment advisor to the Fund is Gamble, Jones, Morphy & Bent (the "Advisor").
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements.
Securities Valuations - Securities that are traded on any exchange or on
the NASDAQ over-the-counter market are valued at the last quoted sale price.
Lacking a last sale price, a security is valued at its last bid price except
when in the opinion of the Advisor the last bid price does not accurately
reflect the current value of the security. All other securities for which
over-the-counter market quotations are readily available are valued at their
last bid price. When market quotations are not readily available, when the
Advisor determines the last bid price does not accurately reflect the current
value or when restricted securities are being valued, such securities are valued
as determined in good faith by the Advisor, in conformity with guidelines
adopted by and subject to review of the Board of Trustees.
Fixed income securities generally are valued by using market quotations,
but may be valued on the basis of prices furnished by a pricing service when the
Advisor believes such prices accurately reflect the fair market value of such
securities. A pricing service utilizes electronic data processing techniques
based on yield spreads relating to securities with similar characteristics to
determine prices for normal institutional-size trading units of debt securities
without regard to sale or bid prices. If the Advisor decides that a price
provided by the pricing service does not accurately reflect the fair market
value of the securities, when prices are not readily available from a pricing
service, or when restricted or illiquid securities are being valued, securities
are valued at fair value as determined in good faith by the Advisor, in
conformity with guidelines adopted by and subject to review of the Board of
Trustees. Short term investments in fixed income securities with maturities of
less than 60 days when acquired, or which subsequently are within 60 days of
maturity, are valued by using the amortized cost method of valuation, which the
Board of Trustees has determined will represent fair value.
Federal Income Taxes - The Fund intends to qualify each year as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended. By so qualifying, the Fund will not be subject to federal income taxes
to the extent that it distributes substantially all of its net investment income
and any realized capital gains.
Dividends and Distributions - The Fund intends to distribute substantially
all of its net investment income as dividends to its shareholders on an annual
basis. The Fund intends to distribute its net long term capital gains and its
net short term capital gains at least once a year.
<page>
GJMB Growth Fund
Notes to Financial Statements
December 31, 2002 - continued
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
Other - The Fund follows industry practice and records security
transactions on the trade date. The specific identification method is used for
determining gains or losses for financial statements and income tax purposes.
Dividend income is recorded on the ex-dividend date and interest income is
recorded on an accrual basis. Discounts and premiums on securities purchased are
amortized over the life of the respective securities.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Gamble, Jones, Morphy & Bent, 301 East Colorado Boulevard, Suite 802,
Pasadena, California, 91101, serves as investment advisor to the Fund. Thomas S.
Jones, President of the Advisor, and Christopher E. Morphy, Executive Vice
President of the Advisor, own a majority of the Advisor's shares and may be
deemed to have controlling interests. The investment decisions for the Fund are
made by Gary A. Pulford under the guidance of the executive committee of the
Advisor. While Mr. Pulford is responsible for the day-to-day management of the
Fund's portfolio, the executive committee is involved in determining the overall
make-up of the Fund.
Under the terms of the management agreement (the "Agreement"), the Advisor
manages the Fund's investments subject to approval of the Board and pays all of
the expenses of the Fund except brokerage fees and commissions, taxes, interest,
fees and expenses of the non-interested person trustees and extraordinary
expenses. As compensation for its management services and agreement to pay the
Fund's expenses, the Fund is obligated to pay the Advisor a fee of 1.20% of the
average daily net assets of the Fund. It should be noted that most investment
companies pay their own operating expenses directly, while the Fund's expenses,
except those specified above, are paid by the Advisor. For the year ended
December 31, 2002 the Advisor earned a fee of $140,601 from the Fund. The
Advisor has contractually agreed to reimburse the Fund for all fees and expenses
of the non-interested person Trustees through October 31, 2004. For the year
ended December 31, 2002, the Advisor reimbursed Trustees' expenses of $2,674.
The Fund retains Unified Fund Services, Inc. ("Unified"), a wholly owned
subsidiary of Unified Financial Services, Inc., to manage the Fund's business
affairs and provide the Fund with administrative, transfer agency, and fund
accounting services, including all regulatory reporting and necessary office
equipment and personnel. The Advisor paid all administrative, transfer agency,
and fund accounting fees on behalf of the Fund per the Agreement. A Trustee and
the officers of the Trust are members of management and /or employees of
Unified.
The Fund retains Unified Financial Securities, Inc., a wholly owned
subsidiary of Unified Financial Services, Inc., to act as the principal
distributor of its shares. There were no payments made to the distributor during
the year ended December 31, 2002. Timothy L. Ashburn (a Trustee and officer of
the Trust), and Thomas G. Napurano (an officer of the Trust) are a director and
officer, respectively, of the Distributor and of Unified Financial Services,
Inc. (the parent company of the Distributor), and may be deemed to be affiliates
of the Distributor. Ronald C. Tritschler owns securities of Unified Financial
Services, Inc. and may be deemed to be an affiliate of the Distributor.
NOTE 4. INVESTMENTS
For the year ended December 31, 2002, purchases and sales of investment
securities, other than short term investments, aggregated $9,225,959, and
$8,831,529, respectively. As of December 31, 2002, the gross unrealized
appreciation for all securities totaled $147,492 and the gross unrealized
depreciation for all securities totaled $1,343,303 for a net unrealized
depreciation of $1,195,811. The aggregate cost of
<page>
GJMB Growth Fund
Notes to Financial Statements
December 31, 2002 - continued
NOTE 4. INVESTMENTS - continued
securities for federal income tax purposes at December 31, 2002, was
$12,235,579. The difference between book cost and tax cost consists of wash
sales in the amount of $314,990.
NOTE 5. ESTIMATES
Preparation of financial statements in accordance with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.
NOTE 6. RELATED PARTY TRANSACTIONS
The Advisor is not a registered broker-dealer of securities and thus does
not receive commissions on trades made on behalf of the Fund. The beneficial
ownership, either directly or indirectly, of more than 25% of the voting
securities of a fund creates a presumption of control of the fund, under Section
2(a)(9) of the Investment Company Act of 1940. As of December 31, 2002, Charles
Schwab & Co. held 96.26% of the outstanding Fund shares in an omnibus account
for the benefit of others.
NOTE 7. CAPITAL LOSS CARRYFORWARD
At December 31, 2002, loss carryforwards totaled $2,596,647; $41,955
expires June 30, 2009, $446,293 expires December 31, 2009 and $2,108,399 expires
in 2010. Capital loss carryforwards are available to offset future realized
capital gains. To the extent that these carryforwards are used to offset future
capital gains, it is probable that the amount, which is offset, will not be
distributed to shareholders.
NOTE 8. DISTRIBUTION TO SHAREHOLDERS
On January 2, 2003, a distribution of $0.0203 per share was declared. The
dividend was paid on January 3, 2003 to shareholders of record on January 2,
2003.
The tax character of distributions paid during the fiscal years 2002 and
2001 were as follows:
Distributions paid from: 2002 2001
------------- ------------
Ordinary Income $ - $ 55,707
Short-Term Capital Gain - -
Long-Term Capital Gain - 13,468
------------- ------------
$ - $ 69,175
============= ============
As of December 31, 2002, the components of distributable
earnings/(accumulated losses) on a tax basis were as follows:
Undistributed ordinary income/(accumulated losses) $ 27,907
Undistributed long-term capital gain/(accumulated losses) (2,591,041)
Unrealized appreciation/(depreciation) (1,195,811)
---------------
$ (3,758,945)
===============
<page>
GJMB Growth Fund
Notes to Financial Statements
December 31, 2002 - continued
NOTE 9. SUBSEQUENT EVENT
On January 3, 2003, the GJMB Growth Fund, a series of the Unified Series
Trust (the "Successor Fund"), acquired all of the assets and liabilities of the
Fund in a tax-free reorganization. Shareholders of the Fund received shares of
the Successor Fund in exchange for their Fund shares, and the Fund ceased
operations.
On February 13, 2003, the Board voted to discontinue the sales load on the
Fund. There had been no sales load imposed on Fund share purchases since its
establishment.
<page>
ELECTION OF TRUSTEES - Unaudited
At a special meeting of the shareholders held on December 18, 2002, a vote
was held to elect members to serve on the Board of Trustees. The vote tally for
each Trustee is as follows:
<table>
<s> <c> <c> <c> <c>
For Against Withheld Total
Gary Hippenstiel 11,300,632.473 987.366 4,698,819.489 16,000,439.33
Stephen A. Little 11,300,632.473 987.366 4,698,819.489 16,000,439.33
Daniel Condon 11,300,632.473 987.366 4,698,819.489 16,000,439.33
Ronald C. Tritschler 11,300,632.473 987.366 4,698,819.489 16,000,439.33
Timothy L. Ashburn 11,300,632.473 987.366 4,698,819.489 16,000,439.33
</table>
<page>
TRUSTEES AND OFFICERS
The Board of Trustees supervises the business activities of the Trust. Each
Trustee serves as a trustee until termination of the Trust unless the Trustee
dies, resigns, retires, or is removed.
The following table provides information regarding each Trustee who is an
"interested person" of the Trust, as defined in the Investment Company Act of
1940, and each officer of the Trust.
<table>
<s> <c> <c> <c>
- ------------------------- ----------------------------------- --------------------------------------- --------------------
Number of
Name, Age and Address Position(s) Held with the Fund Length of Time Served Portfolios in Fund
Complex1 Complex1 Overseen
by Trustee
- ------------------------- ----------------------------------- --------------------------------------- --------------------
- ------------------------- ----------------------------------- --------------------------------------- -------------------
Timothy Ashburn(2) President, Secretary and Trustee President and Secretary since October 27
1104 Buttonwood Court 2002; Trustee of AmeriPrime Advisors
Lexington, KY 40515 Trust since November 2002, AmeriPrime
Funds since December 2002, and
Year of Birth: 1950 Unified Series Trust since October
2002
- ------------------------- ----------------------------------- --------------------------------------- -------------------
</table>
<table>
<s> <c>
- ------------------------------------------------------------- -----------------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ------------------------------------------------------------- -----------------------------------------------------------
- ------------------------------------------------------------- -----------------------------------------------------------
Chairman of Unified Financial Services, Inc. since 1989 and Chairman, Unified Financial Services, Inc. since 1989
Chief Executive Officer from 1989 to 1992 and 1994 to April Director, Unified Financial Services, Inc. since 1990
2002; President of Unified Financial Services from November Director, Unified Fund Services, Inc. since November 2002
1997 to April 2000.
- ------------------------------------------------------------- -----------------------------------------------------------
</table>
<table>
<s> <c> <c> <c>
- ------------------------- ----------------------------------- --------------------------------------- -------------------
Number of
Name, Age and Address Position(s) Held with the Fund Length of Time Served Portfolios in
Complex1 Fund Complex1
Overseen by
Trustee
- ------------------------- ----------------------------------- --------------------------------------- -------------------
- ------------------------- ----------------------------------- --------------------------------------- -------------------
Ronald C. Tritschler(3) Trustee Trustee of AmeriPrime Funds and 27
2361 Old Hickory Lane Unified Series Trust since December
Lexington, KY 40515 2002 and AmeriPrime Advisors Trust
since November 2002
Year of Birth: 1952
- ------------------------- ----------------------------------- --------------------------------------- -------------------
</table>
<table>
<s> <c>
- ------------------------------------------------------------- -----------------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ------------------------------------------------------------- -----------------------------------------------------------
- ------------------------------------------------------------- -----------------------------------------------------------
Chief Executive Officer, Director and legal counsel of The None
Webb Companies, a national real estate company, from 2001
to present; Executive Vice President and Director of The
Webb Companies from 1990 to 2000; Director, The Lexington
Bank, from 1998 to present; Director, Vice President and
legal counsel for The Traxx Companies, an owner and
operator of convenience stores, from 1989 to present.
- ------------------------------------------------------------- -----------------------------------------------------------
</table>
<table>
<s> <c> <c> <c>
- ------------------------- ----------------------------------- --------------------------------------- -------------------
Position(s) Held with the Fund Length of Time Served
Number of
Name, Age and Address Portfolios in
Fund Complex1
Overseen by
Complex1 Trustee
- ------------------------- ----------------------------------- --------------------------------------- -------------------
- ------------------------- ----------------------------------- --------------------------------------- -------------------
Thomas G. Napurano Treasurer and Chief Financial Since October 2002 for AmeriPrime N/A
2424 Harrodsburg Road Officer Funds and AmeriPrime Advisors Trust;
Lexington, KY 40503 since December 2002 for Unified
Series Trust
Year of Birth: 1941
- ------------------------- ----------------------------------- --------------------------------------- -------------------
</table>
<table>
<s> <c>
- ------------------------------------------------------------- -----------------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ------------------------------------------------------------- -----------------------------------------------------------
- ------------------------------------------------------------- -----------------------------------------------------------
Chief Financial Officer and Executive Vice President of N/A
Unified Financial Services, Inc., the parent company of the
Trust's administrator and principal underwriter; member of
the board of directors of Unified Financial Services, Inc.
from 1989 to March 2002.
- ------------------------------------------------------------- -----------------------------------------------------------
</table>
<table>
<s> <c> <c> <c>
- ------------------------- ----------------------------------- --------------------------------------- -------------------
Number of
Name, Age and Address Position(s) Held Length of Time Served Portfolios
with Trust in Fund Complex(1)
Overseen by
Trustee
- ------------------------- ----------------------------------- --------------------------------------- -------------------
- ------------------------- ----------------------------------- --------------------------------------- -------------------
Carol Highsmith Assistant Secretary Since December 2002 for AmeriPrime N/A
431 N. Pennsylvania St. Funds; since November 2002 for
Indianapolis, IN 46204 AmeriPrime Advisors Trust and Unified
Series Trust
Year of Birth: 1964
- ------------------------- ----------------------------------- --------------------------------------- -------------------
</table>
<table>
<s> <c>
- ------------------------------------------------------------- -----------------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held
- ------------------------------------------------------------- -----------------------------------------------------------
- ------------------------------------------------------------- -----------------------------------------------------------
Employed by Unified Fund Services, Inc. (November 1994 to N/A
present); Vice President and Asst. Secretary of Lindbergh
Funds; Asst. Secretary of AmeriPrime Funds and AmeriPrime
Advisors Trust (October 2002 to present).
- ------------------------------------------------------------- -----------------------------------------------------------
</table>
(1) The terms "Fund Complex" refers to AmeriPrime Funds, AmeriPrime Advisors
Trust, and Unified Series Trust.
(2) Mr. Ashburn is an "interested person" of the Trust because he is an
officer of the Trust. In addition, he may be deemed to be an "interested
person" of the Trust because he is Chairman and a director of Unified
Financial Securities, Inc., the principal underwriter for certain funds in
the Fund Complex.
(3) Mr. Tritschler may be deemed to be an "interested person" of the Trust
because he has an ownership interest in Unified Financial Services, Inc.,
the parent company of the principal underwriter for certain funds in the
Fund Complex.
<page>
The following table provides information regarding each Trustee who is not
an "interested person" of the Trust, as defined in the Investment Company Act of
1940.
<table>
<s> <c> <c> <c>
- ------------------------- ------------------------------------ -------------------------- -------------------------
Name, Age and Address Position(s) Held with the Fund Length of Time Served Number of Portfolios in
Complex1 Fund Complex1 Overseen
by Trustee
- ------------------------- ------------------------------------ -------------------------- -------------------------
- ------------------------- ------------------------------------ -------------------------- -------------------------
Gary E. Hippenstiel Trustee Trustee of AmeriPrime 27
600 Jefferson Street Funds since 1995,
Suite 350 AmeriPrime Advisors
Houston, TX 77002 Trust since July 2002
and Unified Series Trust
Year of Birth: 1947 since December 2002
- ------------------------- ------------------------------------ -------------------------- -------------------------
</table>
<table>
<s> <c>
- -------------------------------------------------------------- ----------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- -------------------------------------------------------------- ----------------------------------------------------
- -------------------------------------------------------------- ----------------------------------------------------
Director, Vice President and Chief Investment Officer of None
Legacy Trust Company since 1992.
- -------------------------------------------------------------- ----------------------------------------------------
</table>
<table>
<s> <c> <c> <c>
- ------------------------- ------------------------------------ -------------------------- -------------------------
Position(s) Held Length of Time Served Number
of Portfolios in
Name, Age and Address with the Fund Complex1 Fund Complex1
Overseen by Trustee
- ------------------------- ------------------------------------ -------------------------- -------------------------
- ------------------------- ------------------------------------ -------------------------- -------------------------
Stephen A. Little Trustee Trustee of AmeriPrime 27
3647 Totem Lane Funds and Unified Series
Indianapolis, IN 46208 Trust since December
Year of Birth: 1946 2002 and AmeriPrime
Advisors Trust since
November 2002
- ------------------------- ------------------------------------ -------------------------- -------------------------
</table>
<table>
<s> <c>
- -------------------------------------------------------------- ----------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- -------------------------------------------------------------- ----------------------------------------------------
- -------------------------------------------------------------- ----------------------------------------------------
President and founder, The Rose, Inc., a registered None
investment advisor, since April 1993.
- -------------------------------------------------------------- ----------------------------------------------------
</table>
<table>
<s> <c> <c> <c>
- ------------------------- ------------------------------------ -------------------------- -------------------------
Position(s) Held with the Fund Number of Portfolios
in
Name, Age and Address Complex1 Length of Time Served Fund Complex1 Overseen
by Trustee
- ------------------------- ------------------------------------ -------------------------- -------------------------
- ------------------------- ------------------------------------ -------------------------- -------------------------
Daniel Condon Trustee Trustee of AmeriPrime 27
2385 The Woods Lane Funds and Unified Series
Lexington, KY 40502 Trust since December
2002 and AmeriPrime
Year of Birth: 1950 Advisors Trust since
November 2002
- ------------------------- ------------------------------------ -------------------------- -------------------------
</table>
<table>
<s> <c>
- -------------------------------------------------------------- ----------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- -------------------------------------------------------------- ----------------------------------------------------
- -------------------------------------------------------------- ----------------------------------------------------
Vice President and General Manager, International Crankshaft None
Inc., an automotive equipment manufacturing company, 1990 to present; Trustee,
The Unified Funds, from 1994 to 2002; Trustee, Star Select Funds, a REIT mutual
fund, from 1997 to 2000.
- -------------------------------------------------------------- ----------------------------------------------------
</table>
1 The terms "Fund Complex" refers to AmeriPrime Funds, AmeriPrime Advisors
Trust and Unified Series Trust.
<page>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
GJMB Growth Fund (a series of the AmeriPrime Funds)
We have audited the accompanying statement of assets and liabilities of the
GJMB Growth Fund, including the schedule of portfolio investments, as of
December 31, 2002, and the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two periods
indicated in the period then ended, and the financial highlights for each of the
periods indicated. 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
audit.
We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
investments and cash held as of December 31, 2002 by correspondence with the
custodian. 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 audit provides 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 the
GJMB Growth Fund as of December 31, 2002, the results of its operations for the
year then ended, the changes in net assets for each of the periods indicated in
the period then ended, and the financial highlights for periods indicated, in
conformity with accounting principles generally accepted in the United States of
America.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio
January 23, 2003
<page>
Ariston Convertible Securities Fund
Management Discussion and Analysis of Fund Performance
<table>
<s> <c> <c> <c> <c>
3 Year 5 Year 10 Year
1 Year Average Annual Average Annual Average Annual
Return Return Return Return
Ariston Convertible Securities Fund -29.77% -23.85% -1.89% 3.21%
NASDAQ Composite Index -31.25% -30.81% -2.88% 7.36%
S&P 500 Index -22.12% -14.55% -0.59% 9.46%
</table>
Ariston NASDAQ S&P
12/31/92 10,000.00 10,000.00 10,000.00
12/31/93 13,432.82 13,248.63 11,840.93
12/31/94 13,793.44 12,824.64 12,133.22
12/31/95 16,387.61 18,079.88 16,687.59
12/31/96 17,062.65 22,244.07 20,516.47
12/31/97 19,009.20 27,170.30 27,359.67
12/31/98 19,828.05 38,091.20 35,177.85
12/31/99 39,120.34 70,895.90 42,759.29
12/31/00 33,346.18 43,120.15 38,703.62
12/31/01 24,598.87 34,151.83 34,107.11
12/31/02 17,275.54 23,480.46 26,563.83
The above chart shows the value of a hypothetical initial investment of
$10,000 in the Fund and the S&P 500 Index and NASDAQ Composite Index on December
31, 1992 and held through December 31, 2002. The S&P 500 and NASDAQ Composite
Indices are widely recognized unmanaged indices of common stock prices. The
Indices' returns do not reflect expenses, which have been deducted from the
Fund's return. These performance figures include the change in value of the
stocks in the indices plus the reinvestment of dividends. Shares, when redeemed,
may be worth more or less than their original cost. The Fund may experience
greater risks and price fluctuations due to its concentration in a single sector
as is noted in the Fund's prospectus. The returns shown do not reflect deduction
of taxes that a shareholder would pay on Fund distributions or the redemption of
Fund shares.
THE FUND'S RETURN REPRESENTS PAST PERFORMANCE AND IS NOT PREDICTIVE OF
FUTURE RESULTS.
For a prospectus and more information, including charges and expenses call
1-888-387-2273. The prospectus should be read carefully before investing. The
Fund is distributed by Unified Financial Securities, Inc.
<page>
We have suffered through the longest and worst bear market for stocks in
over 60 years. Last year the S&P 500 had its third consecutive year of
double-digit losses. This has not happened since the depths of the Great
Depression in 1932. The NASDAQ has had three of the five worst years in its 30
year history.
Courtesy: CQG Courtesy: CQG
We do not expect another "generational" bear market of this magnitude for
at least 40 to 45 years.
In all probability, the bear market ended with the climatic sell-off, which
bottomed with a historic wave of capitulation selling in late July. This bottom
was retested in October.
Never before in the last century has a stock market bottomed out long after
the economy has bottomed out. The economy turned up, ending the recession about
one year ago. Likewise, never before in the 89 year history of the Federal
Reserve has the stock market bottomed out long after the Fed started an
aggressive easing of monetary policy.
In the long term, stocks are priced to their fundamentals: earnings and
future earnings growth discounted by inflation and interest rates. In the short
term, stocks are often priced by raw emotion. At major market bottoms, news
always seems bleak. On rare occasions (such as last year) the two can get
totally out of sequence. These rare occasions occur at major historic stock
market tops and bottoms in the market cycle. The emotional market has
indiscriminately priced the best companies at levels comparable to the worst
companies.
We believe the stock market is very undervalued. The price to earnings
ratio (PE) of the market on this year's likely operating earnings is close to
its historical average. However, interest rates and inflation are at 40+ year
lows. Discounting earnings by these historically low interest rates shows that
the S&P 500 is about 35% undervalued. This implies a 50%+ appreciation level to
reach normal valuation. The very vocal media shills that continue to harp that
stocks are grossly overvalued are basing this nonsense on last year's depressed
earnings and are not discounting by today's low interest rates. They would flunk
out of an Investment 101 class! Further, earnings have been understated because
of recent liberalized depreciation accounting standards. Also the accountants
require innovative companies to expense their Research and Development costs
annually instead of amortizing these costs over many years. This artificially
reduces earnings for many growth companies in broad industry segments (i.e.
technology, pharmaceutical, biotechnology, etc.).
The new bull market that likely started in October should have several
years to run. The upside in 2003 has a high probability of being explosive.
Certainly there will be some intermediate setbacks; cyclical markets are not
totally linear in direction. People seem to have forgotten how strong the first
up-legs of new bull markets have been, particularly after a generational bear
market.
Bull markets usually progress through several stages. Off the market
bottom, the trading action is usually dominated by many short-term traders
(hedge funds, brokerage trading desks and short sellers) and the most decimated
sectors initially have the biggest percentage bounces. Then the big institutions
start buying (mutual funds, pension plans, etc.)This is where the high quality,
consistent growth companies take over the upside leadership for the duration of
the bull market. Because of their superior fundamentals, they become revalued
higher and higher. Finally, the public investor joins in the buying. It has been
speculated that these retail investors are so traumatized by the bear market
devastation that they may not come back to the stock market for many years. We
believe this analysis is faulty. The reason is that now there really are not any
attractive investment alternatives to stocks for the retail investor. Consider
that there is about $2.4 trillion in money market mutual funds. There is another
$2.8 trillion stashed in savings deposits. Together this cash totals about 61%
of the value of all stocks in the U.S.! This is an "off-the-chart" level never
even remotely experienced in history. Consider further that the annual yield for
this mountain of cash is a little over 1%! Add in the record amount of money
that moved into bond funds with the 10-year Treasury yield at 4%. Once it
becomes obvious that the stock market is in a bull market (several months of
upside) we believe that it is inevitable that the public investor will begin
coming back (after missing most of the initial strong move).
Courtesy: The Bank Credit Analyst
Treasury bond prices have probably topped out meaning yields should
rise along with the economic recovery. Many investors who have fled from
stocks into T-Bills and bonds with the idea that they are a safe haven from
the bear have, in fact, added risk to their portfolios. Every 1% rise in
interest rates will reduce the value of their 5% bond by around 10%.
Courtesy: CQG
The media has given copious attention to many perma-bears shrilly
preaching morbid economic gloom and paranoid speculation. They predict
economic depression and further massive stock market collapse. One even
boldly predicts that the DJI and gold price will cross at 3,000. There is
absolutely no financial logic to any of their predictions. These idiots are
preaching financial pornography. Ignore them!
All of our Fund's portfolio holdings are seasoned growth companies,
franchise industry leaders in rapid growth industries, very profitable with
huge cash war chests, seasoned owner/managers and honest understandable
accounting. We believe all are strategically positioned for the new bull
market.
For the third quarter 2002, the average year-over-year growth in
operating earnings of our portfolio companies was +40%. This compares with
S&P 500 operating earnings growth of 7%. Earnings and revenue growth will
be at a premium in this bull market.
This has been a very tough time for all of us. However, we believe our
perseverance is about to be rewarded. We truly appreciate your support and
confidence in us. We will continue to work hard for our communal investment
success.
We always welcome the opportunity to discuss any questions you may
have about your investment. Please feel free to contact us.
ARISTON CAPITAL MANAGEMENT CORP.
January, 2003
<page>
Ariston Convertible Securities Fund
Schedule of Investments
December 31, 2002
<table>
<s> <c> <c>
Common Stocks - 39.5% Shares Value
Biological Products (No Diagnostic Substances) - 13.0%
Genzyme Corp. (a) 26,300 $ 777,691
-----------------
Radio & TV Broadcasting & Communications Equipment - 11.7%
QUALCOMM, Inc. (a) 19,269 701,199
-----------------
Semiconductors & Related Devices - 14.8%
Analog Devices, Inc. (a) 37,000 883,190
-----------------
TOTAL COMMON STOCKS (Cost $1,051,305) 2,362,080
-----------------
Convertible Corporate Bonds - 60.4% Principal Amount
Biological Products (No Diagnostic Substances) - 14.2%
Charles River Laboratories International, Inc., 3.5%,
2/1/22 270,000 327,037
Gilead Sciences, Inc., 5%, 12/15/07 345,000 523,538
-----------------
850,575
Pharmaceutical Preparations - 11.2%
Cephalon, Inc., 5.25%, 5/1/06 350,000 345,625
TEVA Pharmaceutical Industries, Ltd., 0.75%, 8/15/21 300,000 320,625
-----------------
666,250
Radio & TV Broadcasting & Communications Equipment - 6.5%
L 3 Communications Holdings, Inc., 5.25%, 6/1/09 300,000 386,250
-----------------
Services - Computer Processing & Data Preparation - 13.7%
Affiliated Computer Services, Inc., 3.5%, 2/15/06 410,000 565,288
Automatic Data Processing, Inc. 0.0%, 2/20/12 250,000 256,250
-----------------
821,538
Services - Computer Programming, Data Processing, Etc. - 5.3%
Gtech Holdings Corp., 1.75%, 12/15/21 250,000 318,750
-----------------
Services - Prepackaged Software - 9.5%
Symantec Corp., 3%, 11/1/06 400,000 565,500
-----------------
TOTAL CORPORATE BONDS (Cost $3,472,266) 3,608,863
-----------------
Money Market Securities - 0.5%
Huntington Money Market Fund, Class A, 0.38%, (Cost $28,245) (b) 28,245 28,245
-----------------
Shares Subject to Call
Call Options - 0.0%
NASDAQ 100 @ 70 Expires 1/18/03 5,500 0
-----------------
TOTAL CALL OPTIONS (Cost $119,848) 0
-----------------
TOTAL INVESTMENTS (Cost $4,671,664) - 100.4% $ 5,999,188
-----------------
Liabilities in excess of other assets - (0.4%) (24,548)
-----------------
TOTAL NET ASSETS - 100.0% $ 5,974,640
=================
</table>
(a) Non-income producing.
(b) Variable rate security; the coupon rate shown represents the yield at
December 31, 2002. <page>
Ariston Convertible Securities Fund
Statement of Assets and Liabilities
December 31, 2002
<table>
<s> <c>
Assets
Investments in securities, at value (cost $4,671,664) $ 5,999,188
Interest receivable 17,550
---------------
Total assets 6,016,738
---------------
Liabilities
Accrued advisory fees 20,546
Redemptions payable 21,552
---------------
Total liabilities 42,098
---------------
Net Assets $ 5,974,640
===============
Net Assets consist of:
Paid in capital 8,995,551
Accumulated net realized gain (loss) on investments (4,348,435)
Net unrealized appreciation (depreciation) on investments 1,327,524
---------------
Net Assets, for 541,371 shares $ 5,974,640
===============
Net Asset Value,
Offering price and redemption price per share ($5,974,640 / 541,371) $ 11.04
===============
</table>
<page>
Ariston Convertible Securities Fund
Statement of Operations
Year ended December 31, 2002
<table>
<s> <c>
Investment Income
Interest income $ 4,402
-----------------
Total Income 4,402
-----------------
Expenses
Investment advisor fee 175,757
Interest expenses 1,910
Trustee expenses 2,404
-----------------
Total Expenses 180,071
-----------------
Net Investment Income (Loss) (175,669)
-----------------
Realized & Unrealized Gain (Loss)
Net realized gain (loss) on investment securities (1,430,572)
Change in net unrealized appreciation (depreciation)
on investment securities (1,652,375)
-----------------
Net realized and unrealized gain (loss) on investment securities (3,082,947)
-----------------
Net increase (decrease) in net assets resulting from operations $ (3,258,616)
=================
</table>
<page>
Ariston Convertible Securities Fund
Statement of Changes In Net Assets
<table>
<s> <c> <c>
Year ended Year ended
Increase (Decrease) in Net Assets Dec. 31, 2002 Dec. 31, 2001
------------------ ----------------
Operations
Net investment income (loss) $ (175,669) $ (402,263)
Net realized gain (loss) on investment securities (1,430,572) (2,430,761)
Change in net unrealized appreciation (depreciation) (1,652,375) (2,042,903)
------------------ ---------------
Net increase (decrease) in net assets resulting from operations (3,258,616) (4,875,927)
------------------ ----------------
Distributions
From net investment income - -
From net realized gain - -
------------------ ---------------
Total distributions - -
------------------ ----------------
Capital Share Transactions
Proceeds from shares sold 3,506,963 2,000,064
Reinvestment of distributions - -
Amount paid for shares repurchased (4,566,567) (5,797,234)
------------------ ----------------
Net increase (decrease) in net assets
resulting
from share transactions (1,059,604) (3,797,170)
------------------ ---------------
Total Increase (Decrease) in Net Assets (4,318,220) (8,673,097)
------------------ ----------------
Net Assets
Beginning of period 10,292,860 18,965,957
------------------ ----------------
End of period $ 5,974,640 $ 10,292,860
================== ================
Capital Share Transactions
Shares sold 289,623 108,112
Shares issued in reinvestment of
distributions - -
Shares repurchased (403,219) (343,274)
------------------ ----------------
Net increase (decrease) from capital transactions (113,596) (235,162)
================== ================
</table>
<page>
Ariston Convertible Securities Fund
Financial Highlights
<table>
<s> <c> <c> <c> <c> <c>
Year ended Year ended Year ended Year ended Year ended
Dec. 31, 2002 Dec. 31, 2001 Dec. 31, 2000 Dec. 31, 1999 (a) Dec. 31, 1998
-------------- ----------------- ----------------- ----------------- -----------------
Selected Per Share Data
Net asset value, beginning of period $ 15.72 $ 21.31 $ 25.00 $ 15.36 $ 15.08
---------------- ----------------- ----------------- ----------------- -----------------
Income from investment operations
Net investment income (loss) (0.27) (0.52) (0.58) (0.11) 0.00
Net realized and unrealized gain (loss) (4.41) (5.07) (3.11) 14.49 0.31
----------------- ----------------- ----------------- ----------------- -----------------
Total from investment operations
(4.68) (5.59) (3.69) 14.38 0.31
----------------- ----------------- ----------------- ----------------- -----------------
Less Distributions to shareholders:
From net investment income 0.00 0.00 0.00 0.00 0.00
From net realized gain 0.00 0.00 0.00 (4.74) (0.03)
------------------ ----------------- ----------------- ----------------- -----------------
Total distributions 0.00 0.00 0.00 (4.74) (0.03)
----------------- ----------------- ----------------- ----------------- -----------------
Net asset value, end of period $ 11.04 $ 15.72 $ 21.31 $ 25.00 $ 15.36
================== ================= ================= ================= =================
Total Return (29.77)% (26.23)% (14.76)% 94.61% 2.09%
Ratios and Supplemental Data
Net assets, end of period (000) $ 5,975 $ 10,293 $ 18,966 $ 15,960 $ 10,385
Ratio of expenses to average net assets 2.28% 2.37% 2.25% 2.10% 2.32%
Ratio of expenses to average net assets
before waiver & reimbursement 2.28% 2.37% 2.28% 2.10% 2.32%
Ratio of net investment income to
average net assets (2.23)% (3.07)% (2.30)% (0.59)% (0.13)%
Ratio of net investment income to
average net assets before waiver
& reimbursement (2.23)% (3.07)% (2.33)% (5.90)% (1.30)%
Portfolio turnover rate 43.59% 26.17% 47.83% 32.89% 27.79%
</table>
(a) See note 1 of the Notes to the Financial Statements.
<page>
Ariston Convertible Securities Fund
Notes to Financial Statements
December 31, 2002
NOTE 1. ORGANIZATION
Ariston Convertible Securities Fund (the "Fund") was organized as a
diversified series of the AmeriPrime Funds (the "Trust") on February 24,
1999. The Trust is established under the laws of Ohio by an Agreement and
Declaration of Trust dated August 8, 1995 (the "Trust Agreement"). The
investment objective of the Fund is total return. The Trust Agreement
permits the Board of Trustees (the "Board") to issue an unlimited number of
shares of beneficial interest of separate series without par value. On
April 30, 1999, the Convertible Securities Fund acquired the assets and
assumed the liabilities of Lexington Convertible Securities Fund in a
tax-free reorganization. The Fund's advisor is Ariston Capital Management
Corporation (the "Advisor").
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed
by the Fund in the preparation of its financial statements.
Securities Valuations - Common stocks, which are traded on any
exchange, are valued at the last quoted sale price. Lacking a last sale
price, a security is valued at the mean between the last bid and ask price
except when, in the Advisor's opinion, the mean price does not accurately
reflect the current value of the security. When market quotations are not
readily available, when the Advisor determines the mean price does not
accurately reflect the current value or when restricted securities are
being valued, such securities are valued as determined in good faith by the
Advisor, in conformity with guidelines adopted by and subject to review and
oversight of the Board of the Trust.
All other securities generally are valued at the mean between the last
bid and ask price, but may be valued on the basis of prices furnished by a
pricing service when the Advisor believes such prices accurately reflect
the fair market value of such securities. Convertible securities are valued
at the greater of the value determined as described in the preceding
sentence and the value of the shares of common stock into which the
securities are convertible (determined as described in the preceding
paragraph). If the Advisor decides that a price provided by the pricing
service does not accurately reflect the fair market value of the
securities, when market quotations are not readily available, when prices
are not readily available from a pricing service, or when restricted or
illiquid securities are being valued, securities are valued at fair value
as determined in good faith by the Advisor, in conformity with guidelines
adopted by and subject to review of the Board of Trustees. Short-term
investments in fixed income securities with maturities of less than 60 days
when acquired, or which subsequently are within 60 days of maturity, are
valued by using the amortized cost method of valuation, which the Board has
determined will represent fair value.
Federal Income Taxes - The Fund intends to qualify each year as a
"regulated investment company" under the Internal Revenue Code of 1986, as
amended. By so qualifying, the Fund will not be subject to federal income
taxes to the extent that it distributes substantially all of its net
investment income and any realized capital gains.
Dividends and Distributions - The Fund intends to distribute
substantially all of its net investment income as dividends to its
shareholders on a quarterly basis. The Fund intends to distribute its net
long-term capital gains and its net short-term capital gains at least once
a year.
Securities Transactions & Investment Income - The Fund follows
industry practice and records security transactions on the trade date. The
specific identification method is used for determining gains or losses for
financial statements and income tax purposes. Dividend income is recorded
on the ex-dividend date and interest income is recorded on an accrual
basis. Discounts and premiums on securities purchased are amortized over
the life of the respective securities. During market conditions that cause
the underlying common stocks of a convertible security to greatly increase
in value, the aggregate amortization of
<page>
Ariston Convertible Securities Fund
Notes to Financial Statements
December 31, 2002 - continued
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
premium can exceed interest income and the aggregate accretion of
discount at levels that may cause the Fund to recognize negative income.
Other - Generally accepted accounting principles require that
permanent financial reporting tax differences relating to shareholder
distributions be reclassified to paid in capital.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund retains Ariston Capital Management Corporation (the
"Advisor") to manage the Fund's investments. The Advisor was founded in
1977. Richard B. Russell, President and controlling shareholder of the
Advisor, is primarily responsible for the day-to-day management of the
Fund's portfolio.
Under the terms of the Fund's management agreement (the "Agreement"),
the Advisor manages the Fund's investments subject to approval of the Board
and pays all of the expenses of the Fund except brokerage fees and
commissions, taxes, borrowing costs (such as (a) interest and (b) dividend
expenses on securities sold short), fees and expenses of non-interested
person trustees, and extraordinary expenses. As compensation for its
management services and agreement to pay the Fund's expenses, the Fund is
obligated to pay the Advisor a fee computed and accrued daily and paid
monthly at an annual rate of 2.25% of the average value of daily net assets
of the Fund, less 12b-1 expenses and fees and expenses of the
non-interested person Trustees. It should be noted that most investment
companies pay their own operating expenses directly, while the Fund's
expenses, except those specified above, are paid by the Advisor. For the
year ended December 31, 2002, the Advisor received fees of $175,757 from
the Fund.
The Fund has adopted a Distribution Plan pursuant to Rule 12b-1 under
the 1940 Act (the "Plan"). The Plan states that the Fund shall pay
directly, or reimburse the Advisor or Distributor, for distribution
expenses in an amount not to exceed 0.25% of the average daily net assets
of the Fund. Expenses of the Fund were not affected by the 12b-1 Plan
because the Fund's Advisor has not activated the Plan.
The Fund retains Unified Fund Services, Inc. ("Unified"), a wholly
owned subsidiary of Unified Financial Services, Inc., to manage the Fund's
business affairs and provide the Fund with administrative, transfer agency,
and fund accounting services, including all regulatory reporting and
necessary office equipment and personnel. The Advisor paid all
administrative, transfer agency, and fund accounting fees on behalf of the
Fund per the Agreement. A Trustee and the officers of the Trust are members
of management and /or employees of Unified.
The Fund retains Unified Financial Securities, Inc., a wholly owned
subsidiary of Unified Financial Services, Inc. to act as the principal
distributor of the Fund's shares. There were no payments made to the
distributor during the year ended December 31, 2002. Timothy L. Ashburn (a
Trustee and officer of the Trust) and Thomas G. Napurano (an officer of the
Trust) are a director and officer, respectively, of the Distributor and of
Unified Financial Services, Inc. (the parent company of the Distributor),
and may be deemed to be affiliates of the Distributor. Ronald C. Tritschler
owns securities of Unified Financial Services, Inc. and may be deemed to be
an affiliate of the Distributor.
NOTE 4. INVESTMENTS
For the year ended December 31, 2002, purchases and sales of
investment securities, other than short-term investments, aggregated
$3,397,544 and $4,482,908, respectively. As of December 31, 2002, the gross
unrealized appreciation for all securities totaled $1,530,267 and the gross
unrealized depreciation for all securities totaled $202,743 for a net
unrealized appreciation of $1,327,524. The aggregate cost of securities for
federal income tax purposes at December 31, 2002 was $4,671,664.
<page>
Ariston Convertible Securities Fund
Notes to Financial Statements
December 31, 2002 - continued
NOTE 5. ESTIMATES
Preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
NOTE 6. CAPITAL LOSS CARRYFORWARDS
At December 31, 2002, the Fund had available for federal tax purposes
an unused capital loss carryforward of $4,215,607; $354,274 expires in
2008, $2,430,761 expires in 2009, and $1,430,572 expires in 2010. Capital
loss carryforwards are available to offset future realized capital gains.
To the extent that these carryforwards are used to offset future capital
gains, it is probable that the amount, which is offset, will not be
distributed to shareholders.
NOTE 7. DISTRIBUTION TO SHAREHOLDERS
As of December 31, 2002, the components of distributable
earnings/(accumulated losses) on a tax basis were as follows:
Undistributed ordinary income/(accumulated losses) $ -
Undistributed long-term capital gain/(accumulated losses) (4,348,435)
Unrealized appreciation/(depreciation) 1,327,524
--------------
$ (3,020,911)
==============
NOTE 8. SUBSEQUENT EVENT
On January 3, 2003, the Ariston Convertible Securities Fund, a series
of the Unified Series Trust (the "Successor Fund"), acquired all of the
assets and liabilities of the Fund in a tax-free reorganization.
Shareholders of the Fund received shares of the Successor Fund in exchange
for their Fund shares, and the Fund ceased operations.
ELECTION OF TRUSTEES (Unaudited)
At a special meeting of the shareholders held on December 18, 2002, a
vote was held to elect members to serve on the Board of Trustees. The vote
tally for each Trustee is as follows:
<table>
<s> <c> <c> <c> <c>
For Against Withheld Total
Gary Hippenstiel 11,300,632.473 987.366 4,698,819.489 16,000,439.328
Stephen A. Little 11,300,632.473 987.366 4,698,819.489 16,000,439.328
Daniel Condon 11,300,632.473 987.366 4,698,819.489 16,000,439.328
Ronald C. Tritschler 11,300,632.473 987.366 4,698,819.489 16,000,439.328
Timothy L. Ashburn 11,300,632.473 987.366 4,698,819.489 16,000,439.328
</table>
<page>
TRUSTEES AND OFFICERS
The Board of Trustees supervises the business activities of the Trust.
Each Trustee serves as a trustee until termination of the Trust unless the
Trustee dies, resigns, retires, or is removed.
The following table provides information regarding each Trustee who is
an "interested person" of the Trust, as defined in the Investment Company
Act of 1940, and each officer of the Trust.
<table>
<s> <c> <c> <c>
- ------------------------- ----------------------------------- --------------------------------- --------------------
Number of
Name, Age and Address Position(s) Held with the Fund Length of Time Served Portfolios in Fund
Complex1 Complex1 Overseen
by Trustee
- ------------------------- ----------------------------------- --------------------------------- --------------------
- ------------------------- ----------------------------------- --------------------------------- --------------------
Timothy Ashburn(2) President, Secretary and Trustee President and Secretary since 27
1104 Buttonwood Court October 2002; Trustee of
Lexington, KY 40515 AmeriPrime Advisors Trust since
November 2002, AmeriPrime Funds
Year of Birth: 1950 since December 2002, and
Unified Series Trust since
October 2002
- ------------------------- ----------------------------------- --------------------------------- --------------------
</table>
<table>
<s> <c>
- ------------------------------------------------------------- ------------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ------------------------------------------------------------- ------------------------------------------------------
- ------------------------------------------------------------- ------------------------------------------------------
Chairman of Unified Financial Services, Inc. since 1989 and Chairman, Unified Financial Services, Inc. since 1989
Chief Executive Officer from 1989 to 1992 and 1994 to April Director, Unified Financial Services, Inc. since 1990
2002; President of Unified Financial Services from November Director, Unified Fund Services, Inc. since November
1997 to April 2000. 2002
- ------------------------------------------------------------- ------------------------------------------------------
</table>
<table>
<s> <c> <c> <c>
- ------------------------- ----------------------------------- --------------------------------- --------------------
Number of
Name, Age and Address Position(s) Held with the Fund Length of Time Served Portfolios in Fund
Complex1 Complex1 Overseen
by Trustee
- ------------------------- ----------------------------------- --------------------------------- --------------------
- ------------------------- ----------------------------------- --------------------------------- --------------------
Ronald C. Tritschler(3) Trustee Trustee of AmeriPrime Funds and 27
2361 Old Hickory Lane Unified Series Trust since
Lexington, KY 40515 December 2002 and AmeriPrime
Advisors Trust since November
Year of Birth: 1952 2002
- ------------------------- ----------------------------------- --------------------------------- --------------------
</table>
<table>
<s> <c>
- ------------------------------------------------------------- ------------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ------------------------------------------------------------- ------------------------------------------------------
- ------------------------------------------------------------- ------------------------------------------------------
Chief Executive Officer, Director and legal counsel of The None
Webb Companies, a national real estate company, from 2001
to present; Executive Vice President and Director of The
Webb Companies from 1990 to 2000; Director, The Lexington
Bank, from 1998 to present; Director, Vice President and
legal counsel for The Traxx Companies, an owner and
operator of convenience stores, from 1989 to present.
- ------------------------------------------------------------- ------------------------------------------------------
</table>
<table>
<s> <c> <c> <c>
- ------------------------- ----------------------------------- --------------------------------- --------------------
Position(s) Held with the Fund Length of Time Served
Number of
Name, Age and Address Portfolios in Fund
Complex1 Overseen
Complex1 by Trustee
- ------------------------- ----------------------------------- --------------------------------- --------------------
- ------------------------- ----------------------------------- --------------------------------- --------------------
Thomas G. Napurano Treasurer and Chief Financial Since October 2002 for N/A
2424 Harrodsburg Road Officer AmeriPrime Funds and AmeriPrime
Lexington, KY 40503 Advisors Trust; since December
2002 for Unified Series Trust
Year of Birth: 1941
- ------------------------- ----------------------------------- --------------------------------- --------------------
</table>
<table>
<s> <c>
- ------------------------------------------------------------- ------------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ------------------------------------------------------------- ------------------------------------------------------
- ------------------------------------------------------------- ------------------------------------------------------
Chief Financial Officer and Executive Vice President of N/A
Unified Financial Services, Inc., the parent company of the
Trust's administrator and principal underwriter; member of
the board of directors of Unified Financial Services, Inc.
from 1989 to March 2002.
- ------------------------------------------------------------- ------------------------------------------------------
</table>
<table>
<s> <c> <c> <c>
- ------------------------------ ------------------------------ --------------------------- --------------------------
Number of Portfolios
Name, Age and Address Position(s) Held Length of Time Served in Fund Complex(1)
with Trust Overseen by Trustee
- ------------------------------ ------------------------------ --------------------------- --------------------------
- ------------------------------ ------------------------------ --------------------------- --------------------------
Carol Highsmith Assistant Secretary Since December 2002 for N/A
431 N. Pennsylvania St. AmeriPrime Funds; since
Indianapolis, IN 46204 November 2002 for
AmeriPrime Advisors Trust
Year of Birth: 1964 and Unified Series Trust
- ------------------------------ ------------------------------ --------------------------- --------------------------
</table>
<table>
<s> <c>
- ------------------------------------------------------------- ------------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held
- ------------------------------------------------------------- ------------------------------------------------------
- ------------------------------------------------------------- ------------------------------------------------------
Employed by Unified Fund Services, Inc. (November 1994 to None
present); Vice President and Asst. Secretary of Lindbergh
Funds; Asst. Secretary of AmeriPrime Funds and AmeriPrime
Advisors Trust (October 2002 to present).
- ------------------------------------------------------------- ------------------------------------------------------
</table>
(1) The terms "Fund Complex" refers to AmeriPrime Funds, AmeriPrime
Advisors Trust, and Unified Series Trust.
(2) Mr. Ashburn is an "interested person" of the Trust because he is an
officer of the Trust. In addition, he may be deemed to be an "interested
person" of the Trust because he is Chairman and a director of Unified
Financial Securities, Inc., the principal underwriter for certain funds
in the Fund Complex.
(3) Mr. Tritschler may be deemed to be an "interested person" of the Trust
because he has an ownership interest in Unified Financial Services, Inc.,
the parent company of the principal underwriter for certain funds in the
Fund Complex.
<page>
The following table provides information regarding each Trustee who is not
an "interested person" of the Trust, as defined in the Investment Company Act of
1940.
<table>
<s> <c> <c> <c>
- ------------------------------ ---------------------------------- ----------------------- -------------------------
Name, Age and Address Position(s) Held with the Fund Length of Time Served Number of Portfolios in
Complex1 Fund Complex1 Overseen
by Trustee
- ------------------------------ ---------------------------------- ----------------------- -------------------------
- ------------------------------ ---------------------------------- ----------------------- -------------------------
Gary E. Hippenstiel Trustee Trustee of AmeriPrime 27
600 Jefferson Street Funds since 1995,
Suite 350 AmeriPrime Advisors
Houston, TX 77002 Trust since July 2002
and Unified Series
Year of Birth: 1947 Trust since December
2002
- ------------------------------ ---------------------------------- ----------------------- -------------------------
</table>
<table>
<s> <c>
- ----------------------------------------------------------------- -------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ----------------------------------------------------------------- -------------------------------------------------
- ----------------------------------------------------------------- -------------------------------------------------
Director, Vice President and Chief Investment Officer of Legacy None
Trust Company since 1992.
- ----------------------------------------------------------------- -------------------------------------------------
</table>
<table>
<s> <c> <c> <c>
- ------------------------------ ---------------------------------- ----------------------- -------------------------
Position(s) Held Length of Time Served
Number of Portfolios in
Name, Age and Address with the Fund Complex1 Fund Complex1
Overseen by Trustee
- ------------------------------ ---------------------------------- ----------------------- -------------------------
- ------------------------------ ---------------------------------- ----------------------- -------------------------
Stephen A. Little Trustee Trustee of AmeriPrime 27
3647 Totem Lane Funds and Unified
Indianapolis, IN 46208 Series Trust since
Year of Birth: 1946 December 2002 and
AmeriPrime Advisors
Trust since November
2002
- ------------------------------ ---------------------------------- ----------------------- -------------------------
</table>
<table>
<s> <c>
- ----------------------------------------------------------------- -------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ----------------------------------------------------------------- -------------------------------------------------
- ----------------------------------------------------------------- -------------------------------------------------
President and founder, The Rose, Inc., a registered investment None
advisor, since April 1993.
- ----------------------------------------------------------------- -------------------------------------------------
</table>
<table>
<s> <c> <c> <c>
- ------------------------------ ---------------------------------- ----------------------- -------------------------
Position(s) Held with the Fund Number of
Portfolios in
Name, Age and Address Complex1 Length of Time Served Fund Complex1 Overseen
by Trustee
- ------------------------------ ---------------------------------- ----------------------- -------------------------
- ------------------------------ ---------------------------------- ----------------------- -------------------------
Daniel Condon Trustee Trustee of AmeriPrime 27
2385 The Woods Lane Funds and Unified
Lexington, KY 40502 Series Trust since
December 2002 and
Year of Birth: 1950 AmeriPrime Advisors
Trust since November
2002
- ------------------------------ ---------------------------------- ----------------------- -------------------------
</table>
<table>
<s> <c>
- ----------------------------------------------------------------- -------------------------------------------------
Principal Occupations During Past 5 Years Other Directorships Held by Trustee
- ----------------------------------------------------------------- -------------------------------------------------
- ----------------------------------------------------------------- -------------------------------------------------
Vice President and General Manager, International Crankshaft None
Inc., an automotive equipment manufacturing company, 1990 to present; Trustee,
The Unified Funds, from 1994 to 2002; Trustee, Star Select Funds, a REIT mutual
fund, from 1997 to 2000.
- ----------------------------------------------------------------- -------------------------------------------------
</table>
1 The terms "Fund Complex" refers to AmeriPrime Funds, AmeriPrime Advisors
Trust and Unified Series Trust.
<page>
INDEPENDENT AUDITOR'S REPORT
To The Shareholders and
Board of Trustees
Ariston Convertible Securities Fund
(series of AmeriPrime Funds):
We have audited the accompanying statement of assets and liabilities of the
Ariston Convertible Securities Fund, including the schedule of portfolio
investments as of December 31, 2002, 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 audit. The financial highlights for the year ended December 31,
1998, were audited by other auditors whose report dated February 19, 1999,
expressed an unqualified opinion.
We conducted our audit in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
investments and cash held as of December 31, 2002, by correspondence with the
custodian and brokers. An audit also included assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audit provides 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 the
Ariston Convertible Securities Fund as of December 31, 2002, 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 of America.
McCurdy & Associates CPA's, Inc.
Westlake, Ohio
January 23, 2003
<page>
Item 2. Code of Ethics. Not applicable to Annual Reports for the period
ended December 31, 2002.
Item 3. Audit Committee Financial Expert. Not applicable to Annual Reports
for the period ended December 31, 2002.
Items 4-8. Reserved
Item 9. Controls and Procedures. Not applicable to Annual Reports for the
period ended December 31, 2002.
Item 10. Exhibits. Certifications required by Item 10(b) of Form N-CSR are
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) Ameriprime Funds
By /s/ Timothy Ashburn
[Timothy Ashburn, President]
Date 3/3/03
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/ Timothy Ashburn
[Timothy Ashburn, President]
Date 3/3/03
By /s/ Thomas Napurano
[Thomas Napurano, Chief Financial Officer]
Date 3/3/03
<page>