<page>
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)
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: 07/31
-------------
Date of reporting period: 01/31/03
-----------
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.
March 20, 2003
Dear Fellow Shareholders,
With respect to Management Discussion of the Fund's Performance, we are
pleased to present the semi annual report of the Dobson Covered Call Fund
(DBCCX) as of January 31, 2003.
Our expectation is that the overall market will remain relatively flat over
the next 6 months. We also expect it to be somewhat volatile but less so than
the past 6 months. We also don't expect a major rally until corporate profits
rise despite a presumed good outcome in Iraq. We disagree with those that blame
poor performance in the stock market on the situation in Iraq. In our opinion,
corporate profits need to improve before the stock market improves. We also
continue to believe that worldwide competition will keep growth at modest levels
and therefore returns in the S&P 500 Index will be well under 10% annualized for
some time to come.
If our expectations are correct, your Fund's strategy should continue to be
a superior investment to the Index.
I would like to refer you to the management discussion and analysis
following for specific details about the Dobson Covered Call Fund performance.
We welcome your comments and thank you for investing with us.
Sincerely,
Charles L. Dobson
Portfolio Manager
The prospectus should be read carefully before investing. To request a
prospectus for more complete information, including charges and expenses, call
toll free 1-877-2-DOBSON OR 1-877-236-2766. Past performance does not guarantee
future results. Shares when redeemed may be worth more or less than their
original cost.
Distributed by Unified Financial Securities, Inc.,
431 North Pennsylvania Street
Indianapolis, IN 46204
Member NASD, SIPC.
<page>
Management's Discussion of Fund Performance
For the reported six-month period your Fund had a total return of -3.08%
while the S&P 500 Index had a total return -5.26%. From inception through
January 31, 2003 your Fund's annualized total return was -2.80%, while the S&P
500 Index annualized return was -6.76%. Your Fund's standard deviation based on
monthly returns from inception was 3.90 and the S&P 500 Index standard deviation
for the same period was 5.19. Standard deviation is a statistical term that
measures the divergence of returns around the average return. The lower this
number the less volatile returns were over the defined time period.
DBCCX S&P 500 Index
Standard Deviation (volatility level)
Comparison (04/01/99 through 01/31/03) 3.90 5.19
6-Month Actual Return
For the Period Ended 01/31/03 -3.08% -5.26%
Average Annual Total Return
For the Period Ended 01//31/03
Since Inception (03/22/99) -2.80% -6.76%
Actual Return for
the Year Ended 01/31/03 -17.48% -23.02%
Volatility DBCXX-3.90 S&P 500 Index-5.19
Dobson S & P 500
3/22/99 10,000.00 10,000.00
6/30/99 10,960.00 10,913.02
12/31/99 11,104.22 11,753.98
6/30/00 11,261.21 11,703.81
12/31/00 11,148.29 10,683.73
6/30/01 10,677.90 9,968.39
12/31/01 10,805.15 9,408.04
6/30/02 9,877.84 8,168.10
1/31/03 8,961.23 7,135.68
This graph shows the value of a hypothetical initial investment of $10,000
in the Fund and the S&P 500 Index on March 22, 1999 (inception of the Fund) and
held through January 31, 2003. 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 index plus the
reinvestment of dividends and are not annualized. 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
DOES NOT PREDICT FUTURE RESULTS. Investment returns and principal values will
fluctuate so that our shares, when redeemed, may be worth more or less than
their original purchase price. For more information on the Dobson Covered Call
Fund, please call 1-877-2-Dobson or 1-877-236-2766 to request a prospectus.
Investing in the Fund involves certain risks that are discussed in the Fund's
prospectus. Please read the prospectus carefully before you invest or send
money.
I don't think we need to tell you that the past few years have been the
worst the stock market has seen since the 1930's. Many people have lost a good
portion of their retirement assets that were invested in stocks and are worried
about where to invest their money now. We share their concerns. The question is
what to do.
We believe that a portion of your assets should be invested in the stock
market and particularly in a covered call strategy like your Fund's. We also
believe it is prudent to diversify across other asset classes, including cash.
Diversification should reduce your volatility, and consequently we believe it is
highly likely that a diversified portfolio will outperform its benchmark over
the long term (five years or more).
We believe that a reduction in volatility is one of the key factors in your
Fund's ability to outperform its benchmark, the S&P 500 Index. Remember that we
invest in mostly dividend paying common stocks represented in the S&P 500 Index,
maintaining industry weightings similar to the Index. One can view our
underlying stocks as a quasi index fund. We then sell options on the stocks in
the portfolio to reduce your Fund's volatility.
Your Fund is also diversified within the options it sells. Some are in the
money, some at the money and some out of the money. Options that are sold are
diversified with various durations ranging from one to six months depending upon
our analysis of option premiums. Just like your Fund is diversified, we
encourage our shareholders to be diversified across other asset classes.
The past six months results are in line with our expectations for your
Fund's covered call program. It should be pointed out that the fourth quarter
returns were superior to expectations. This can be attributed to higher than
normal option premiums for that period and our analysis of option premium levels
suggesting a bias to out of the money options. As we discussed in our annual
report six months ago, dispersion of returns was a major factor in our previous
6-month results. Dispersion in September 2002 and January 2003 affected expected
returns negatively, but was offset by the superior fourth quarter dispersion of
returns. Another point to make is that our expected returns are based on
long-term results, not what happens in a given week or month.
<page>
Dobson Covered Call Fund
Schedule of Investments
January 31, 2003 (Unaudited)
<table>
<s> <c> <c>
Common Stocks - 93.53% Shares Value
Aircraft - 2.31%
Boeing Co. 1,000 $ 31,590
--------------
Auto Controls for Regulating Residential & Commercial Environment - 1.79%
Honeywell International, Inc. 1,000 24,440
--------------
Beverages - 2.96%
Coca-Cola Co. 1,000 40,460
--------------
Cable & Other Pay Television Services - 0.63%
Comcast Corp. Class A (a) 323 8,601
--------------
Canned, Frozen & Preserved Fruit, Vegetable & food Specialty - 2.36%
H.J. Heinz Co. 1,000 32,310
--------------
Canned, Fruits, Veg, Preserves, Jams & Jellies - 0.27%
Del Monte Foods Co. (a) 446 3,733
--------------
Chemical & Allied Products - 0.22%
Monsanto Co. 170 3,001
--------------
Computer Communication Equipment - 1.96%
Cisco Systems, Inc. (a) 2,000 26,740
--------------
Construction Machinery & Equipment - 3.22%
Caterpillar, Inc. 1,000 43,980
--------------
Cutlery, Handtools & General Hardware - 2.19%
The Gillette Co. 1,000 29,900
--------------
Electric Services - 2.49%
Duke Energy, Inc. 2,000 34,060
--------------
Electromedical & Electrotherapeutic Apparatus - 3.28%
Medtronic, Inc. 1,000 44,920
--------------
Electronic & Other Electrical Equipment (No Computer Equipment) - 3.38%
General Electric Co. 2,000 46,280
--------------
Electronic Computers - 3.49%
Dell Computer Corp. (a) 2,000 47,720
--------------
Finance Services - 2.60%
American Express Co. 1,000 35,530
--------------
</table>
<page>
Dobson Covered Call Fund
Schedule of Investments
January 31, 2003 (Unaudited) - continued
<table>
<s> <c> <c>
Common Stocks - 93.53% - continued
Fire, Marine & Casualty Insurance - 4.17%
American International Group, Inc. 1,000 54,120
Travelers Property Casualty Corp. Class B (a) 118 1,919
Travelers Property Casualty Corp. Class A (a) 57 924
--------------
56,963
--------------
Motor Vehicles & Passenger Car Bodies - 0.66%
Ford Motor Co. 1,000 9,110
--------------
National Commercial Banks - 11.94%
Bank of America Corp. 1,000 70,050
Citigroup, Inc. 1,333 45,829
Wells Fargo & Co. 1,000 47,370
--------------
163,249
--------------
Oil & Gas Field Services - 2.76%
Schlumberger Ltd.. 1,000 37,700
--------------
Paper Mills - 2.61%
International Paper Co. 1,000 35,700
--------------
Petroleum Refining - 2.50%
Exxon Corp. 1,000 34,150
--------------
Pharmaceutical Preparations - 11.18%
Bristol-Myers Squibb, Inc. 1,000 23,590
Pfizer, Inc. 1,000 30,360
Pharmacia Corp. 1,000 41,770
Schering-Plough, Inc. 1,000 18,110
Wyeth 1,000 39,030
--------------
152,860
--------------
Photographic Equipment & Supplies - 2.22%
Eastman Kodak, Inc. 1,000 30,300
--------------
Radio & Tv Broadcasting & Communications Equipment - 2.75%
QUALCOMM, Inc. (a) 1,000 37,660
--------------
Radiotelephone Communications - 0.14%
AT&T Wireless Services, Inc. (a) 321 1,948
--------------
Retail - Eating Places - 1.04%
McDonald's Corp. 1,000 14,240
--------------
Retail - Lumber & Other Building Materials Dealers - 1.53%
The Home Depot, Inc. 1,000 20,900
--------------
</table>
<page>
Dobson Covered Call Fund
Schedule of Investments
January 31, 2003 (Unaudited) - continued
<table>
<s> <c> <c>
Common Stocks - 93.53% - continued
Retail - Variety Stores - 3.50%
Wal-Mart Stores, Inc. 1,000 47,800
--------------
Security Brokers, Dealers & Flotation Companies - 0.67%
Schwab(Charles) Corp. 1,000 9,220
--------------
Semiconductors & Related Devices - 2.32%
Agere Systems, Inc. - Class B (a) 264 459
Agere Systems, Inc. - Class A (a) 10 18
Intel Corp. 2,000 31,320
--------------
31,797
--------------
Services - Miscellaneous Amusement & Recreation - 1.28%
Walt Disney Co. 1,000 17,500
--------------
Services - Prepackaged Software - 5.23%
Microsoft Corp. (a) 1,000 47,460
Oracle Corp. (a) 2,000 24,060
--------------
71,520
--------------
Telephone & Telegraph Apparatus - 0.14%
Lucent Technologies, Inc. (a) 1,000 1,860
--------------
Telephone Communications (No Radiotelephone) - 3.74%
AT&T Corp. 200 3,896
BellSouth Corp. 1,000 22,780
SBC Communications, Inc. 1,000 24,440
--------------
51,116
--------------
TOTAL COMMON STOCKS (Cost $2,056,786) 1,278,858
--------------
Money Market Securities - 7.26%
Federal Prime Obligation Fund, 1.01%, (Cost $99,243) (b) 99,243 99,243
--------------
TOTAL INVESTMENTS (Cost $2,120,255) - 100.79% $ 1,378,101
--------------
Liabilities in excess of cash and other assets - (0.79)% (10,906)
--------------
TOTAL NET ASSETS - 100.00% $ 1,367,195
==============
</table>
(a) Non-income producing.
(b) Variable rate security; the coupon rate shown represents the rate at
January 31, 2003.
<page>
Dobson Covered Call Fund
Schedule of Investments
January 31, 2003 (Unaudited) - continued
<table>
<s> <c> <c>
Options Written January 31, 2003
Shares
Subject
Common Stocks / Expiration Date @ Exercise Price to Call Value
- -------------------------------------------------------- ------------- --------------
American Express / April 2003 @ 40 1,000 $ 850
American International / May 2003 @ 70 1,000 350
Bank of America Corp. / February 2003 @ 75 1,000 300
BellSouth Corp. / July 2003 @ 30 1,000 400
Boeing Company / March 2003 @ 35 1,000 450
Bristol-Myers Squibb, Inc. / March 2003 @ 25 1,000 800
Caterpillar, Inc. / February 2003 @ 50 1,000 50
Cisco Systems, Inc. / April 2003 @ 15 1,000 700
Cisco Systems, Inc. / February 2003 @ 15 1,000 200
Citigroup, Inc. / March 2003 @ 40 1,000 300
Coca-cola Company / February 2003 @ 50 1,000 50
Dell Computer Corp. / May 2003 @ 32.5 1,000 200
Dell Computer Corp. / February 2003 @ 32.5 1,000 50
Disney Company / February 2003 @ 17.5 1,000 600
Exxon Mobil / February 2003 @ 37.5 1,000 100
General Electric / June 2003 @ 27.5 1,000 600
General Electric / February 2003 @ 27.5 1,000 50
H.J. Heinz Company / March 2003 @ 35 1,000 250
Home Depot, Inc. / February 2003 @ 32.5 1,000 50
Honeywell / March 2003 @ 27.5 1,000 300
Intel Corp. / March 2003 @ 17 1,000 500
Intel Corp. / February 2003 @ 20 1,000 50
International Paper / April 2003 @ 40 1,000 700
McDonalds Corp. / June 2003 @ 17.5 1,000 300
Medtronic, Inc. / February 2003 @ 50 1,000 100
Microsoft Corp. / April 2003 @ 60 1,000 350
Pfizer, Inc. / March 2003 @ 32.5 1,000 450
Pharmacia Corp. / April 2003 @ 50 1,000 100
Qualcomm / March 2003 @ 40 1,000 1,750
SBC Communications / April 2003 @ 30 1,000 300
Schering Plough Company / February 2003 @ 25 1,000 50
Schlumberger Ltd. / February 2003 @ 45 1,000 100
Wal-Mart Stores, Inc. / March 2003 @ 55 1,000 250
Well Fargo / April 2003 @ 50 1,000 1,100
Wyeth / April 2003 @ 40 1,000 1,750
--------------
Total (premiums received $35,774) 35,000 $ 14,500
==============
</table>
<page>
Dobson Covered Call Fund
Statement of Assets and Liabilities
January 31, 2003 (Unaudited)
<table>
<s> <c>
Assets
Investments in securities, at value (cost $2,120,255) $ 1,378,101
Interest receivable 61
Dividends receivable 2,052
Receivable from adviser 9,544
----------------
Total assets 1,389,758
----------------
Liabilities
Accrued expenses 8,063
Covered call options written -
(premiums received $35,774) 14,500
----------------
Total liabilities 22,563
----------------
Net Assets $ 1,367,195
================
Net Assets consist of:
Paid in capital 2,140,305
Accumulated net investment income (loss) (19,918)
Accumulated net realized gain (loss) on investments 3,462
Net unrealized appreciation (depreciation) on investments (756,654)
----------------
Net Assets, for 220,193 shares $ 1,367,195
================
Net Asset Value
Offering price and redemption price per share ($1,367,195 / 220,193) $ 6.21
================
</table>
<page>
Dobson Covered Call Fund
Statement of Operations
Six months ended January 31, 2003 (Unaudited)
<table>
<s> <c>
Investment Income
Dividend income $ 13,703
Interest income 626
--------------
Total Income 14,329
--------------
Expenses
Administration expenses 15,817
Auditing expenses 1,579
Custodian expenses 4,746
Fund accounting expenses 5,059
Insurance expenses 175
Legal expenses 3,183
Trustee expenses 1,168
Pricing expenses 2,225
Registration expenses 903
Printing expenses 1,605
Transfer agent expenses 6,366
Miscellaneous expenses 1,588
--------------
Total Expenses 44,544
Reimbursed expenses (34,050)
--------------
Total operating expenses 10,494
--------------
Net Investment Income (Loss) 3,835
--------------
Realized & Unrealized Gain (Loss)
Net realized gain (loss) on investment securities (26)
Net realized gain (loss) on options
transactions 45,031
Change in net unrealized appreciation (depreciation)
on investment securities (92,609)
--------------
Net realized and unrealized gain (loss) on investment securities & option transactions (47,604)
--------------
Net increase (decrease) in net assets resulting from operations $ (43,769)
==============
</table>
<page>
Dobson Covered Call Fund
Statement of Changes In Net Assets
<table>
<s> <c> <c>
Six months ended For the
Jan. 31, 2003 year ended
Increase (Decrease) in Net Assets (Unaudited) July 31, 2002
-------------------- -------------------
Operations
Net investment income (loss) $ 3,835 $ 3,990
Net realized gain (loss) on investment securities (26) (9,035)
Net realized gain (loss) on options transactions 45,031 -
Change in net unrealized appreciation (depreciation) (92,609) 131,486
-------------------- -------------------
Net increase (decrease) in net assets resulting from operations (43,769) 126,441
-------------------- -------------------
Distributions
From net investment income (3,979) (5,586)
From net realized gain (93,218) (178,824)
-------------------- -------------------
Total distributions (97,197) (184,410)
-------------------- -------------------
Capital Share Transactions
Proceeds from shares sold 52,971 236,552
Reinvestment of distributions 97,197 184,410
Amount paid for shares repurchased (34,475) (221,333)
-------------------- -------------------
Net increase (decrease) in net assets
resulting
from share transactions 115,693 199,629
-------------------- -------------------
Total Increase (Decrease) in Net Assets (25,273) (260,025)
-------------------- -------------------
Net Assets
Beginning of period 1,392,468 1,652,493
-------------------- -------------------
End of period [including accumulated net
investment income (loss) of $3,965 and $0,
respectively] $ 1,367,195 $ 1,392,468
==================== ===================
Capital Share Transactions
Shares sold 7,908 28,863
Shares issued in reinvestment of distributions 15,046 23,462
Shares repurchased (5,053) (26,939)
-------------------- -------------------
Net increase (decrease) from capital transactions 17,901 25,386
==================== ===================
</table>
<page>
Dobson Covered Call Fund
Financial Highlights
<table>
<s> <c> <c> <c> <c> <c>
Six months ended For the For the For the For the
Jan. 31, 2003 year ended year ended
year ended period ended (Unaudited)
July 31, 2002 July 31, 2001 July 31,
2000 July 31, 1999 (c)
----------------- ---------------- ---------------- ---------------- -----------------
Selected Per Share Data
Net asset value, beginning of period $ 6.88 $ 9.34 $ 10.67 $ 10.78 $ 10.00
---------------- ---------------- ---------------- ---------------- ------------------
Income from investment operations
Net investment income (loss) 0.02 0.02 0.04 0.03 0.01
Net realized and unrealized gain (loss) (0.21) (1.36) (0.22) 0.35 0.77
----------------- ---------------- ---------------- ---------------- -----------------
Total from investment operations (0.19) (1.34) (0.18) 0.38 0.78
------------------ ---------------- ---------------- ---------------- -------------------
Less Distributions to shareholders:
From net investment income (0.02) (0.03) (0.18) (0.01) 0.00
From net realized gain (0.46) (1.09) (0.97) (0.48) 0.00
----------------- ---------------- ---------------- ---------------- -------------------
Total distributions (0.48) (1.12) (1.15) (0.49) 0.00
----------------- ---------------- ---------------- ---------------- -------------------
Net asset value, end of period $ 6.21 $ 6.88 $ 9.34 $ 10.67 $ 10.78
============= ================ ================ ================ ===================
Total Return (3.08)% (b) (15.82)% (1.64)% 3.59% 7.80% (b)
Ratios and Supplemental Data
Net assets, end of period (000) $1,367 $1,392 $1,652 $1,540 $1,375
Ratio of expenses to average net assets 1.50% (a) 1.50% 1.50% 1.50% 1.50% (a)
Ratio of expenses to average net assets
before waiver & reimbursement 7.15% (a) 5.51% 5.19% 5.47% 9.77% (a)
Ratio of net investment income to
average net assets 0.57% (a) 0.26% 0.44% 0.31% 0.32% (a)
Ratio of net investment income to
average net assets before waiver
& reimbursement (5.10)% (a) (3.75)% (3.25)% (3.66)% (7.95)% (a)
Portfolio turnover rate 0.00% 6.51% 6.62% 31.75% 47.01%
</table>
(a) Annualized.
(b) For periods of less than a full year, total return is not annualized. (c)
March 24, 1999 (commencement of operations) to July 31, 1999.
<page>
Dobson Covered Call Fund
Notes to Financial Statements
January 31, 2003 (Unaudited)
NOTE 1. ORGANIZATION
Dobson Covered Call Fund (the "Fund") was organized as a diversified series
of the AmeriPrime Funds (the "Trust") on March 22, 1999 and commenced operations
on March 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 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 total return over the long term. The investment
advisor to the Fund is Dobson Capital Management, Inc. (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 Fund's 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.
Option writing - When the Fund writes an option, an amount equal to the
premium received by the Fund is recorded as a liability and is subsequently
adjusted to the current fair value of the option written. Premiums received from
writing options that expire unexercised are treated by the Fund on the
expiration date as realized gains from investments. The difference between the
premium and the amount paid on effecting a closing purchase transaction,
including brokerage commissions, is also treated as a realized gain, or if the
premium is less than the amount paid for the closing purchase transaction, as a
realized loss. If a call option is exercised, the premium is added to the
proceeds from the sale of the underlying security or currency in determining
whether the Fund has realized a gain or loss. If a put option is exercised, the
premium reduces the cost basis of the securities purchased by the Fund. The Fund
as writer of an option bears the market risk of an unfavorable change in the
price of the security underlying the written option.
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.
<page>
Dobson Covered Call Fund
Notes to Financial Statements
January 31, 2003 (Unaudited) - continued
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
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.
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
The Fund retains Dobson Capital Management, Inc., 1422 S. Van Ness Street,
Santa Ana, CA 92707 to serve as investment advisor to the Fund. The Advisor is a
California corporation established in September 1998. Charles L. Dobson is the
president, director and sole shareholder of the Advisor, and is primarily
responsible for the day-to-day management of the Fund's portfolio.
Under the terms of the management agreement, (the "Agreement"),
the Advisor manages the Fund's investments subject to approval of the
Board. As compensation for its management services, the Fund is
obligated to pay the Advisor a fee computed and accrued daily and paid
monthly at an annual rate of 0.80% of the average daily net assets of
the Fund, less the amount by which total operating expenses, including
management fees, exceed 1.50% of the average value of its daily net
assets. The Advisor has contractually agreed to reimburse the Fund for
the operating expenses it incurs, but only to the extent necessary to
maintain the Fund's total annual operating expenses (excluding
brokerage costs, borrowing costs, taxes and extraordinary expenses) at
1.50% of its average daily net assets. For the six months ended
January 31, 2003, the Advisor received fees of $0 from the Fund. For
the six months ended January 31, 2003, the Advisor reimbursed Fund
expenses of $34,050. At January 31, 2003 there was a net receivable
from the Advisor in the amount of $9,544.
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
services, including all regulatory reporting and necessary office
equipment and personnel. Unified receives a monthly fee from the Fund
equal to an annual rate of 0.10% of the Fund's assets over $50
million, 0.075% of the Fund's assets from $50 million to $100 million,
and 0.050% of the Fund's assets over $100 million (subject to a
minimum fee of $2,500 per month). For the six months ended January 31,
2003, the administrator received fees of $15,817 from the Fund for
administrative services provided to the Fund. A Trustee and the
officers of the Trust are members of management and/or employees of
Unified.
The Fund also retains Unified to act as the Fund's transfer agent
and fund accountant. For its services as transfer agent, Unified
receives a monthly fee from the Fund of $1.20 per shareholder (subject
to a minimum monthly fee of $750). For the six months ended January
31, 2003, Unified received fees of $6,366 from the Fund for transfer
agent services provided to the Fund. For its services as fund
accountant, Unified receives an annual fee from the Fund equal to
0.0275% of the Fund's assets up to $100 million, 0.0250% of the Fund's
assets from $100 million to $300 million, and 0.0200% of the Fund's
assets over $300 million (subject to various monthly minimum fees, the
maximum being $2,100 per month for assets of $20 million to $100
million). For the six months ended January 31, 2003, Unified received
fees of $5,059 from the Fund for fund accounting services provided to
the Fund.
<page>
Dobson Covered Call Fund
Notes to Financial Statements
January 31, 2003 (Unaudited) - continued
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - continued
The Fund retains Unified Financial Securities, Inc. (the
"Distributor"), 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 six months
ended January 31, 2003. The Fund has adopted a plan, pursuant to Rule
12b-1 under the Investment Company Act of 1940, which permits the Fund
to pay directly, or reimburse the Fund's Advisor and Distributor, for
certain distribution and promotion expenses related to marketing its
shares, in an amount not to exceed 0.25% of the average daily net
assets of the Fund. Effective December 10, 1999 the 12b-1 plan was
inactivated and as a result there were no 12b-1 payments made to the
Distributor for the six months ended January 31, 2003. 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 six months ended January 31, 2003, purchases and sales of
investment securities, other than short-term investments, aggregated
$56,950 and $41, respectively. As of January 31, 2003, the gross
unrealized appreciation for all securities totaled $51,494 and the
gross unrealized depreciation for all securities totaled $759,016 for
a net unrealized depreciation of $707,522. The aggregate cost of
securities for federal income tax purposes at January 31, 2003 was
$2,156,029.
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 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 January 31, 2003, Charles L. Dobson, President of
the Advisor, beneficially owned in aggregate more than 66% of the
Fund.
Dobson Covered Call Fund
Notes to Financial Statements
January 31, 2003 (Unaudited) - continued
NOTE 7. CALL OPTIONS WRITTEN
As of January 31, 2003, portfolio securities valued at $1,278,858
were held in escrow by the custodian as cover for call options written
by the Fund.
Transactions in options written during the period ended January
31, 2003 were as follows:
Number of Premiums
Contracts Received
Options outstanding at July 31, 2002 353 $35,712
Options written 863 90,960
Options terminated in closing purchase transactions (163) (19,987)
Options expired (703) (70,911)
----- --------
Options outstanding at January 31, 2003 350 $35,774
NOTE 8. 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
Timothy L. Ashburn 11,300,632.473 987.366 4,698,819.489 16,000,439.328
Daniel J. Condon 11,300,632.473 987.366 4,698,819.489 16,000,439.328
Gary E. 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
Ronald C. Tritschler 11,300,632.473 987.366 4,698,819.489 16,000,439.328
</table>
<page>
Item 2. Code of Ethics. Not applicable to Semi-Annual Reports.
Item 3. Audit Committee Financial Expert. Not applicable to Semi-Annual
Reports.
Items 4-8. Reserved
Item 9. Controls and Procedures. Not applicable to Semi-Annual Reports for the
period ended January 31, 2003.
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 3/25/03
----------------------------------------------------
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 3/25/03
----------------------------------------------------
By
* /s/ Thomas Napurano
-------------------------------------------------------
Thomas Napurano, Chief Financial Officer
Date 3/21/03