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 033-96826
---------------------------------------------
Ameriprime Funds
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
___________431 N. Pennsylvania St.______46204___________________________________
(Address of principal executive offices) (Zip code)
Timothy Ashburn,
Unified Fund Services, 431 N. Pennsylvania Street, 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: 7/31
--------------------
Date of reporting period: 1/31
-------------------
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
Item 1. Reports to Stockholders.
Dobson
Covered Call Fund
Semi-annual Report
January 31, 2004
(Unaudited)
Fund Advisor:
Dobson Capital Management, Inc.
1422 S. Van Ness Street
Santa Ana, CA 92707
Toll Free 877-2-DOBSON (877-236-2766)
March 1, 2004
Dear Fellow Shareholders:
We are pleased to present the semi-annual report of the Dobson Covered Call Fund
(DBCCX) as of 01/31/04.
We would also like to welcome the new shareholders to our Fund this past six
months and thank them for investing with us.
I would like to refer you to the management discussion and analysis that follows
for specific details about the Dobson Covered Call Fund performance, our
expectations for the future and other topics in the news regarding the Mutual
Fund Industry.
We welcome your comments and again thank you for investing with us.
Sincerely,
/s/Charles L. Dobson
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.
Managements Discussion of Fund Performance
For the 6 month period ended January 31, 2004 our Fund had a total return of
8.03% while the S&P 500 Index had a total return of 15.21%. From inception of
the Fund (March 22, 1999) through January 31, 2004 our Fund's annualized return
was 1.36%, while the S&P 500 Index annualized return was -.84%. Our Fund's
monthly standard deviation based on monthly returns from April 1, 2003 was 3.63
and the S&P 500 standard deviation for the same period was 4.97. 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.
[Graph Omitted]
Volatility (Risk) Comparison
Dobson Covered Call Fund S&P 500 Index
3.63 4.97
I don't think I need to tell you that these past 12 months haven't been the most
favorable for a covered call strategy. During that period the S&P 500 Index
appreciated 34.53% while our Fund appreciated 19.16%. To put these numbers in
context, should the index appreciate more than 20% over a twelve-month period we
expect our covered call strategy to capture between 50% and 66% of that
appreciation. We're pretty close to the middle of those expectations so we can
say we did what we expected to do.
Looking over the longer term one can see the value of our covered call strategy.
Our Fund has appreciated 1.36% on an annualized basis (net of fees) from
inception while the S&P 500 Index has declined -.84% on an annualized basis
(gross of fees). These inception numbers are approximately 2 months short of
five years.
I'm sure many people question the value of our covered call program this past 12
months just as I'm sure many people wished they were in our covered call program
for calendar years 2000, 2001 and 2002. Unfortunately we don't have the ability
to accurately and consistently predict what years the market will be up or down
and by how much. That is why we hedge our stock positions with individual stock
options. By reducing the
volatility of our portfolio, that means lagging the Index in up markets and
losing less in down markets, we expect to do better than the Index over time.
And that is what we have done over approximately the past 5 years. We should
also point out that the portfolio is weighted by S&P 500 Industry weights.
One other point to make about the markets these last several months is the rapid
appreciation of many of the smaller capitalization stocks in the S&P 500 Index.
As you can see from the attached portfolio almost all of our stocks are the
larger capitalization issues. It is reasonable to assume that our portfolio lags
the Index more than it would if it had some smaller and mid capitalization
names. It is also reasonable to assume that if the smaller capitalization stocks
decline in the near future our portfolio may do better than expected. We bring
this to your attention as there has been a lot of speculation in the press of
late touting large capitalization issues and we wanted to explain what might
happen should this occur.
To get a better understanding of our expectations we refer you to our website,
www.dobsoncapital.com. For those of you without access to the internet please
call us toll free at 877-546-3066 and we will send you the written explanations.
Overall we are pleased with results from inception and believe we have a
reasonable probability of meeting expectations in the future. As always, past
performance does not guarantee future results.
Management's Discussion of Mutual Fund Issues
There have been many issues in the press recently regarding Mutual Fund
Disclosure. We would like to address some of them here.
1. Portfolio Ownership. As of January 31, 2004, I am not only the Portfolio
Manager of our Fund but I am the beneficial owner of approximately 19% of the
outstanding shares.
2. Soft Dollars. Although soft dollar arrangements are permitted, it is our
belief that commission dollars should be used to keep commission costs low.
Therefore we have not nor do we intend to use commission dollars to pay for
research or other services.
3. Broker/Dealers. Currently we deal with two broker dealers for the purchase
and sale of stocks and options. Both have agreed to the same commission costs.
As of this date none of the Broker/Dealers we use has or has ever had any
clients with us.
4. Disaster Recovery. Recently we physically moved our computers to another
location to simulate a building disaster. All of our systems were able to
function immediately. The only difficulty we experienced was with telephone
lines. E-mail obviously worked fine. We also e-mail a copy of the portfolio to
our primary backup Portfolio Manager's home
any day changes are made to the portfolio. Our service provider, Unified Fund
Services, Inc. in Indianapolis, Indiana, and our custodian bank UMB bank in
Kansas City also have copies of our positions. We believe this will allow us to
recover from any major disaster.
5. Proxy voting policies. Please contact us if you would like a copy of our
proxy voting policies or to see our proxy voting record.
6. 12b-1 fees. The Fund does not make use of 12b-1 fees.
I hope the above analysis has been useful and informative. Please do not
hesitate to call me toll free at 877-546-3066 if you have any questions and
please visit our website at www.dobsoncapital.com.
Investment Results
- ------------------
Average Annual Total Returns
(for periods ended January 31, 2004)
Since Inception
One Month Six Months One Year Three Year(March 22, 1999)
--------- ---------- -------- ---------- ---------------
Dobson Covered Call Fund* 0.82% 8.03% 19.16% -1.87% 1.36%
S&P 500 Index** 1.84% 15.21% 34.53% -4.60% -0.84%
- --------------------------------------------------------------------------------
The rate of return will vary and the principal value of an investment will
fluctuate. Shares, if redeemed, may be worth more or less than their original
cost. Performance data quoted does not reflect the deduction of taxes that an
investor may pay on Fund distributions or the redemption of Fund shares. Past
performance is not indicative of future investment results. Due to market
volatility, current performance may be higher or lower than the performance
shown above.
* Return figures reflect any change in price per share and assume the
reinvestment of all distributions.
** The Index is an unmanaged benchmark that assumes reinvestment of all
distributions and excludes the effect of taxes and fees. The S&P 500 Index is a
widely recognized unmanaged index of equity prices and is representative of a
broader market and range of securities than is found in the Fund's portfolio.
Comparison of the Growth of a $10,000 Investment in the Dobson Covered Call Fund
and the S&P 500 Index
[Graph Omitted]
Dobson
Covered Call S&P 500
Fund Index
------------------------------
3/22/99 10,000.00 10,000.00
7/31/99 10,780.00 10,572.59
7/31/00 11,167.02 11,520.55
7/31/01 10,983.65 9,870.22
7/31/02 9,246.19 7,531.63
7/31/03 9,884.77 8,332.78
1/31/04 10,678.44 9,599.94
The chart above assumes an initial investment of $10,000 made on March 22, 1999
(commencement of Fund operations) and held through January 31, 2004. THE FUND'S
RETURN REPRESENTS PAST PERFORMANCE AND DOES NOT GUARANTEE FUTURE RESULTS. The
returns shown do not reflect deduction of taxes that a shareholder would pay on
Fund distributions or the redemption of Fund shares. Investment returns and
principal values will fluctuate so that your shares, when redeemed, may be worth
more or less than their original purchase price.
Dobson Covered Call Fund
Schedule of Investments
January 31, 2004 (Unaudited)
Common Stocks - 98.31% Shares Value
-------------- ------------
Air Courier Services - 1.20%
FedEx Corp. 1,000 $ 67,280
------------
Aircraft - 2.21%
Boeing Co. 3,000 125,250
------------
Aircraft Engines & Engine Parts - 1.01%
United Technologies Corp. 600 57,324
------------
Beverages - 3.32%
Coca-Cola Co. 1,900 93,556
PepsiCo, Inc. 2,000 94,520
------------
188,076
------------
Biological Products (No Diagnostic Substances) - 2.29%
Amgen, Inc. (a) 2,000 128,980
------------
Cable & Other Pay Television Services - 1.40%
Comcast Corp. Class A (a) 2,323 79,261
------------
Canned, Frozen & Preserved Fruit, Vegetable & food Specialty - 0.63%
H.J. Heinz Co. 1,000 35,380
------------
Chemical & Allied Products - 1.48%
Dow Chemical Co. 2,000 83,900
------------
Computer Communication Equipment - 1.81%
Cisco Systems, Inc. (a) 4,000 102,560
------------
Computers & Office Equipment - 3.51%
International Business Machines Corp. 2,000 198,460
------------
Construction Machinery & Equipment - 1.38%
Caterpillar, Inc. 1,000 78,130
------------
Cutlery, Handtools & General Hardware - 0.64%
The Gillette Co. 1,000 36,250
------------
Diversified - 0.65%
Honeywell International, Inc. 1,000 36,120
------------
Electric Services - 1.82%
Duke Energy, Inc. 2,000 43,460
The Southern Co. 2,000 59,600
------------
103,060
------------
Electromedical & Electrotherapeutic Apparatus - 1.74%
Medtronic, Inc. 2,000 98,440
------------
Electronic & Other Electrical Equipment - 1.78%
General Electric Co. 3,000 100,890
------------
See accompanying notes which are an integral part of the financial statements.
Dobson Covered Call Fund
Schedule of Investments - continued
January 31, 2004 (Unaudited)
Shares Value
-------------- ------------
Electronic Computers - 1.77%
Dell, Inc. (a) 3,000 $ 100,410
------------
Finance Services - 5.27%
American Express Co. 2,000 103,680
First Data Corp. 2,000 78,320
Morgan Stanley 2,000 116,420
------------
298,420
------------
Fire, Marine & Casualty Insurance - 2.45%
American International Group, Inc. 2,000 138,900
------------
Motor Vehicles & Passenger Car Bodies - 2.01%
Ford Motor Co. 1,000 14,540
General Motors Corp. 2,000 99,360
------------
113,900
------------
National Commercial Banks - 12.75%
Bank of America Corp. 2,000 162,920
Bank One Corp. 3,000 151,830
Citigroup, Inc. 4,333 214,397
J.P. Morgan Chase & Co. 2,000 77,780
Wells Fargo & Co. 2,000 114,820
------------
721,747
------------
Oil & Gas Field Services - 2.16%
Schlumberger Ltd. 2,000 122,360
------------
Paper Mills - 1.49%
International Paper Co. 2,000 84,540
------------
Petroleum Refining - 4.49%
Chevron Texaco Corp. 2,000 172,700
Exxon Mobil Corp. 2,000 81,580
------------
254,280
------------
Pharmaceutical Preparations - 10.50%
Bristol-Myers Squibb Inc. 3,000 84,150
Johnson & Johnson 2,000 106,840
Merck & Co., Inc. 3,000 142,800
Pfizer, Inc. 4,400 161,172
Schering-Plough Corp. 1,000 17,540
Wyeth 2,000 81,900
------------
594,402
------------
Photographic Equipment & Supplies - 0.50%
Eastman Kodak, Inc. 1,000 28,410
------------
Radio & Tv Broadcasting & Communications Equipment - 1.03%
QUALCOMM, Inc. 1,000 58,420
------------
See accompanying notes which are an integral part of the financial statements.
Dobson Covered Call Fund
Schedule of Investments - continued
January 31, 2004 (Unaudited)
Shares Value
-------------- ------------
Radiotelephone Communications - 1.20%
AT&T Wireless Services, Inc. (a) 321 $ 3,547
Dominion Resouces, Inc. 1,000 64,160
------------
67,707
------------
Retail - Drug Stores & Proprietary Stores - 1.83%
Walgreen Co. 3,000 103,650
------------
Retail - Eating Places - 1.36%
McDonald's Corp. 3,000 77,220
------------
Retail - Lumber & Other Building Materials Dealers - 1.88%
Home Depot, Inc. 3,000 106,410
------------
Retail - Variety Stores - 4.87%
Target Corp. 3,000 113,880
Wal-Mart Stores, Inc. 3,000 161,550
------------
275,430
------------
Retail-Drug Stores and Proprietary Stores - 0.16%
Medco Health Solutions, Inc. (a) 241 8,881
------------
Security Brokers, Dealers & Flotation Companies - 2.30%
The Charles Schwab Corp. 1,000 12,590
Merrill Lynch & Co., Inc. 2,000 117,580
------------
130,170
------------
Semiconductors & Related Devices - 3.84%
Agere Systems, Inc. - Class B (a) 264 963
Intel Corp. 4,000 122,400
Texas Instruments, Inc. 3,000 94,050
------------
217,413
------------
Services - Miscellaneous Amusement & Recreation - 1.27%
Walt Disney Co. 3,000 72,000
------------
Services - Prepackaged Software - 2.44%
Microsoft Corp. 4,000 110,600
Oracle Corp. (a) 2,000 27,620
------------
138,220
------------
Soap, Detergent, Cleaning Preparations, Perfumes, Cosmetics - 1.79%
Procter & Gamble, Inc. 1,000 101,080
------------
Telephone & Telegraph Apparatus - 0.08%
Lucent Technologies, Inc. (a) 1,000 4,480
------------
Telephone Communications - 4.00%
AT&T Corp. 3,200 62,272
BellSouth Corp. 3,000 87,690
SBC Communications, Inc. 3,000 76,500
------------
226,462
------------
TOTAL COMMON STOCKS (Cost $5,359,849) 5,564,273
------------
See accompanying notes which are an integral part of the financial statements.
Dobson Covered Call Fund
Schedule of Investments - continued
January 31, 2004 (Unaudited)
Principal
Amount Value
-------------- ------------
Money Market Securities - 6.55%
Federated Prime Obligations, 0.68% (b) $ 370,821 $ 370,821
------------
TOTAL MONEY MARKET SECURITIES (Cost $370,821) 370,821
------------
TOTAL INVESTMENTS (Cost $5,730,670) - 104.86% $ 5,935,094
------------
Liabilities in excess other assets - (4.86%) (275,070)
------------
TOTAL NET ASSETS - 100.00% $ 5,660,024
============
(a) Non-income producing.
(b) Variable rate security; the coupon rate shown represents the rate at January
31, 2004.
See accompanying notes which are an integral part of the financial statements.
Dobson Covered Call Fund
Schedule of Investments - continued
January 31, 2004 (Unaudited)
Options Written January 31, 2004
Shares
Subject
Common Stocks / Expiration Date @ Exercise Price to Call Value
- --------------------------------------------------------- -------------- ------------
American Express / April 2004 @ 47.5 1,000 $ 4,800
American Express / March 2004 @ 50 1,000 2,550
American International Group, Inc. / February 2004 @ 60 1,000 9,200
American International Group, Inc. / February 2004 @ 65 1,000 4,800
American Telephone & Telegraph Co. / April 2004 @ 20 2,000 1,500
American Telephone & Telegraph Co. / July 2004 @ 22.5 1,200 600
Amgen, Inc. / August 2004 @ 60 1,000 6,100
Amgen, Inc. / October 2004 @ 65 1,000 1,250
Bank of America Corp. / February 2004 @ 75 1,000 6,700
Bank of America Corp. / May 2004 @ 80 1,000 3,600
Bank One Corp. / February 2004 @ 45 1,500 8,400
Bank One Corp. / May 2004 @ 45 1,500 8,700
BellSouth Corp. / July 2004 @ 27.5 1,000 2,750
BellSouth Corp. / March 2004 @ 30 2,000 1,700
Boeing Co. / February 2004 @ 37.5 2,000 8,400
Boeing Co. / May 2004 @ 40 1,000 3,100
Bristol-Myers Squibb Co. / February 2004 @ 27.5 2,000 1,700
Bristol-Myers Squibb Co. / March 2004 @ 30 1,000 350
Caterpillar, Inc. / May 2004 @ 80 1,000 3,200
ChevronTexaco Corp. / February 2004 @ 85 1,000 2,000
ChevronTexaco Corp. / March 2004 @ 85 1,000 2,400
Cisco Systems, Inc. / April 2004 @ 22.5 2,000 8,000
Cisco Systems, Inc. / July 2004 @ 30 2,000 2,000
Citigroup, Inc. / June 2004 @ 50 2,300 4,715
Citigroup, Inc. / March 2004 @ 47.5 2,000 5,500
Coca-Cola Co. / February 2004 @ 47.5 900 1,800
Coca-Cola Co. / May 2004 @ 47.5 1,000 2,700
Comcast Corp. Class A / April 2004 @ 35 1,300 1,755
Comcast Corp. Class A / July 2004 @ 37.50 1,000 1,200
Dell, Inc. / February 2004 @ 35 2,000 700
Dell, Inc. / May 2004 @ 35 2,000 2,500
Disney Co. / April 2004 @ 22.5 1,000 2,100
Disney Co. / July 2004 @ 25 2,000 2,300
Dow Chemical / March 2004 @ 40 1,000 2,450
Dow Chemical / March 2004 @ 35 1,000 6,900
Eastman Kodak / July 2004 @ 30 1,000 1,550
Exxon Mobil / April 2004 @ 40 1,000 1,600
Exxon Mobil / July 2004 @ 40 1,000 2,200
FedEx Corp. / February 2004 @ 70 1,000 250
First Data / February 2004 @ 37.5 1,000 2,250
First Data / May 2004 @ 40 1,000 1,850
General Electric Co. / March 2004 @ 30 1,000 4,000
General Electric Co. / March 2004 @ 32.5 2,000 3,600
See accompanying notes which are an integral part of the financial statements.
Dobson Covered Call Fund
Schedule of Investments - continued
January 31, 2004 (Unaudited)
Shares
Subject
Common Stocks / Expiration Date @ Exercise Price to Call Value
- --------------------------------------------------------- -------------- ------------
General Motors Corp. / June 2004 @ 55 1,000 $ 1,050
General Motors Corp. / March 2004 @ 42.5 1,000 7,000
Gillette / March 2004 @ 35 1,000 2,100
H.J. Heinz Co. / March 2004 @ 35 1,000 850
Home Depot Inc. / February 2004 @ 35 2,000 2,300
Home Depot Inc. / May 2004 @ 37.5 1,000 950
Honeywell International, Inc. / March 2004 @ 32.5 1,000 3,500
Intel Corp. / April 2004 @ 35 2,000 900
Intel Corp. / February 2004 @ 32.5 2,000 500
International Business Machines / April 2004 @ 90 1,000 10,200
International Business Machines / February 2004 @ 95 1,000 4,500
International Paper / April 2004 @ 42.5 1,000 1,600
International Paper / July 2004 @ 45 1,000 950
J.P. Morgan Chase & Co. / June 2004 @ 37.5 1,000 2,850
J.P. Morgan Chase & Co. / March 2004 @ 35 1,000 4,100
Johnson & Johnson / April 2004 @ 55 1,000 950
Johnson & Johnson / July 2004 @ 55 1,000 1,650
McDonald's Corp. / June 2004 @ 30 1,500 450
McDonald's Corp. / March 2004 @ 25 1,500 1,950
Medtronic, Inc. / February 2004 @ 55 1,000 50
Medtronic, Inc. / May 2004 @ 50 1,000 1,850
Merrill Lynch & Co., Inc. / April 2003 @ 60 1,000 1,950
Merrill Lynch & Co., Inc. / February 2004 @ 45 2,000 5,800
Merrill Lynch & Co., Inc. / July 2004 @ 50 1,000 1,400
Merrill Lynch & Co., Inc. / July 2004 @ 60 1,000 2,950
Microsoft Corp. / April 2004 @ 27.5 2,000 2,500
Microsoft Corp. / July 2004 @ 30 2,000 1,600
Morgan Stanley / April 2004 @ 55 1,000 4,600
Morgan Stanley / July 2004 @ 60 1,000 3,000
PepsiCo, Inc. / April 2004 @ 50 1,000 350
PepsiCo, Inc. / July 2004 @ 47.5 1,000 1,800
Pfizer, Inc. / February 2004 @ 35 2,400 4,200
Pfizer, Inc. / March 2004 @ 32.5 2,000 8,000
Procter & Gamble Co. / April 2004 @ 100 1,000 3,100
QUALCOMM, Inc. / April 2004 @ 50 1,000 9,100
SBC Communications / April 2004 @ 25 2,000 2,700
Schlumberger Ltd. / August 2004 @ 55 1,000 7,700
Schlumberger Ltd. / May 2004 @ 50 1,000 11,400
Target Corp. / April 2004 @ 40 1,500 1,800
Target Corp. / March 2004 @ 40 1,500 1,275
Texas Instruments / April 2004 @ 27.5 1,500 6,900
Texas Instruments / July 2004 @ 35 1,500 2,475
United Technologies / February 2004 @ 85 600 6,120
Walgreen Co. / April 2004 @ 35 1,500 1,650
Walgreen Co. / July 2004 @ 35 1,500 2,550
Wal-Mart Stores, Inc. / February 2004 @ 55 2,000 1,100
Wal-Mart Stores, Inc. / March 2004 @ 60 1,000 200
Wells Fargo & Co. / April 2004 @ 60 1,000 600
Wells Fargo & Co. / February 2004 @ 55 1,000 2,500
Wyeth / April 2004 @ 45 1,000 450
Wyeth / July 2004 @ 45 1,000 1,200
------------
Total (premiums received $215,610) 121,700 $ 296,940
============
See accompanying notes which are an integral part of the financial statements.
Dobson Covered Call Fund
Statement of Assets and Liabilities
January 31, 2004 (Unaudited)
Assets
Investments in securities, at value (cost $5,730,670) $ 5,935,094
Interest receivable 262
Dividends receivable 8,922
Receivable for options written 11,648
Receivable from advisor 11,438
---------------
Total assets 5,967,364
---------------
Liabilities
Covered call options written (premiums received $215,610) 296,940
Other payables and accrued expenses 10,123
Trustee fees accrued 277
---------------
Total liabilities 307,340
---------------
Net Assets $ 5,660,024
===============
Net Assets consist of:
Paid in capital 5,750,244
Undistributed accumulated net investment income (loss) (3,319)
Net realized appreciateion (depreciation) on investments (209,994)
Net unrealized appreciation (depreciation)
on investments 204,424
on options (81,331)
---------------
Net Assets $ 5,660,024
===============
Shares outstanding (unlimited number of shares with no par value) 764,571
---------------
Net Asset Value
Offering price and redemption price per share $ 7.40
===============
See accompanying notes which are an integral part of the financial statements.
Dobson Covered Call Fund
Statement of Operations
Six months ended January 31, 2004 (Unaudited)
Investment Income
Dividend income $ 48,094
Interest income 1,591
---------------
Total Income 49,685
---------------
Expenses
Investment advisor fee 21,156
Administration expenses 15,600
Custodian expenses 8,100
Transfer agent expenses 6,106
Fund accounting expenses 6,089
Auditing expenses 5,660
Pricing expenses 4,127
Legal expenses 3,543
Trustee expenses 1,825
Registration expenses 1,353
Miscellaneous expenses 1,066
Insurance expenses 979
Printing expenses 503
---------------
Total Expenses 76,107
Reimbursed expenses (a) (36,409)
---------------
Net operating expenses 39,698
---------------
Net Investment Income (Loss) 9,987
---------------
Realized & Unrealized Gain (Loss)
Net realized gain (loss) on investment securities (6,445)
Net realized gain (loss) on options transactions (166,545)
Change in net unrealized appreciation (depreciation)
on investment securities 568,564
---------------
Net realized and unrealized gain (loss) on investment securities 395,574
---------------
Net increase (decrease) in net assets resulting from operations $ 405,561
===============
(a) See note 3 to the financial statements.
See accompanying notes which are an integral part of the financial statements.
Dobson Covered Call Fund
Statements of Changes In Net Assets
Six months ended
January 31, 2004 Year ended
(Unaudited) July 31, 2003
----------------------- ------------------
Operations
Net investment income (loss) $ 9,987 $ 10,446
Net realized gain (loss) on investment securities (6,445) 1,516
Net realized gain (loss) on options transactions (166,545) 3,023
Change in net unrealized appreciation (depreciation) 568,564 218,573
----------------------- ------------------
Net increase (decrease) in net assets resulting from operations 405,561 233,558
----------------------- ------------------
Distributions
From net investment income - (3,978)
From net realized gain - (93,218)
----------------------- ------------------
Total distributions - (97,196)
----------------------- ------------------
Capital Share Transactions
Proceeds from shares sold 677,650 3,371,983
Reinvestment of distributions - 97,196
Amount paid for shares repurchased (220,967) (200,229)
----------------------- ------------------
Net increase (decrease) in net assets resulting
from share transactions 456,683 3,268,950
----------------------- ------------------
----------------------- ------------------
Total Increase (Decrease) in Net Assets 862,244 3,405,312
----------------------- ------------------
Net Assets
Beginning of period 4,797,780 1,392,468
----------------------- ------------------
End of period $ 5,660,024 $ 4,797,780
======================= ==================
Accumulated net investment income (loss) $ (3,319) $ -
----------------------- ------------------
Capital Share Transactions
Shares sold 95,575 512,521
Shares issued in reinvestment of distributions - 15,046
Shares repurchased (30,922) (29,941)
----------------------- ------------------
Net increase (decrease) from capital transactions 64,653 497,626
===========================================
See accompanying notes which are an integral part of the financial statements.
Dobson Covered Call Fund
Financial Highlights
Six months ended
Jan. 31, 2004 Year ended Year ended Year ended Year ended Period ended
(Unaudited) July 31, 2003July 31, 2002July 31, 2001July 31, 2000 July 31,1999(a)
-------------------------- ----------- ----------- ------------ ------------
Selected Per Share Data
Net asset value, beginning of period $ 6.85 $ 6.88 $ 9.34 $ 10.67 $ 10.78 $ 10.00
------------ ------------ ----------- ----------- ------------ ------------
Income from investment operations
Net investment income (loss) - 0.03 0.02 0.04 0.03 0.01
Net realized and unrealized gain (loss) (0.55) 0.42 (1.36) (0.22) 0.35 0.77
------------ ------------ ----------- ----------- ------------ ------------
Total from investment operations (0.55) 0.45 (1.34) (0.18) 0.38 0.78
------------ ------------ ----------- ----------- ------------ ------------
Less Distributions to shareholders:
From net investment income - (0.02) (0.03) (0.18) (0.01) -
From net realized gain - (0.46) (1.09) (0.97) (0.48) -
------------ ------------ ----------- ----------- ------------ ------------
Total distributions - (0.48) (1.12) (1.15) (0.49) -
------------ ------------ ----------- ----------- ------------ ------------
Net asset value, end of period $ 6.30 $ 6.85 $ 6.88 $ 9.34 $ 10.67 $ 10.78
============ ============ =========== =========== ============ ============
Total Return 8.03% (b) 6.91% -15.82% -1.64% 3.59% 7.80% (b)
Ratios and Supplemental Data
Net assets, end of period (000) $ 5,660 $ 4,798 $ 1,392 $ 1,652 $ 1,540 $ 1,375
Ratio of expenses to average net assets 1.50% (c) 1.50% 1.50% 1.50% 1.50% 1.50% (c)
Ratio of expenses to average net assets
before waiver & reimbursement 2.87% (c) 4.83% 5.51% 5.19% 5.47% 9.77% (c)
Ratio of net investment income to
average net assets 0.38% (c) 0.48% 0.26% 0.44% 0.31% 0.32% (c)
Ratio of net investment income to
average net assets before waiver & reimbursement (0.99)(c) (2.85)% (3.75)% (3.25)% (3.66)% (7.95) (c)
Portfolio turnover rate 0.20% 0.47% 6.51% 6.62% 31.75% 47.01%
(a) For the period March 24, 1999 (Commencement of Operations) to July 31, 1999.
(b) Not annualized
(c) Annualized.
See accompanying notes which are an integral part of the financial statements.
Dobson Covered Call Fund
Notes to the Financial Statements
January 31, 2004
(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 an open-end investment company 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 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
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 - Equity 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. Securities that are traded on any stock
exchange are generally valued by the pricing service at the last quoted sale
price. Lacking a last sale price, an exchange traded security is generally
valued by the pricing service at its last bid price. Securities traded in the
NASDAQ over-the-counter market are generally valued by the pricing service at
the NASDAQ Official Closing Price. When market quotations are not readily
available, when the Advisor determines that the market quotation or the price
provided by the pricing service does not accurately reflect the current market
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 of the Trust.
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, 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.
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.
Dobson Covered Call Fund
Notes to the Financial Statements
January 31, 2004 - continued
(Unaudited)
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES - continued
Federal Income Taxes- There is no provision for federal income tax. The Fund
intends to continue to qualify each year as a "regulated investment company"
under subchapter M of the Internal Revenue Code of 1986, as amended, by
distributing substantially all of its net investment income and net realized
capital gains.
Security Transactions and Related 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.
Dividends and Distributions- The Fund intends to distribute substantially all of
its net investment income as dividends to its shareholders on at least an annual
basis. The Fund intends to distribute its net realized long term capital gains
and its net realized short term capital gains at least once a year. The
treatment for financial reporting purposes of distributions made to shareholders
during the year from net investment income or net realized capital gains may
differ from their ultimate treatment for federal income tax purposes. These
differences are caused primarily by differences in the timing of the recognition
of certain components of income, expense or realized capital gain for federal
income tax purposes. Where such differences are permanent in nature, they are
reclassified in the components of the net assets based on their ultimate
characterization for federal income tax purposes. Any such reclassifications
will have no effect on net assets, results of operations or net asset values per
share of the Fund.
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES
The Fund retains Dobson Capital Management, Inc. 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, 2004, the Advisor received fees of $21,156 from
the Fund. For the six months ended January 31, 2004, the Advisor was obligated
to waive and/or reimburse expenses of $36,409. At January 31, 2004 there was a
net receivable from the Advisor in the amount of $11,438.
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 under $50 million, 0.07% of the Fund's assets from $50 million to
$100 million, 0.05% of the Fund's assets $100 million to $150, and 0.03% of the
Fund's assets over 150 million (subject to a minimum fee of $2,500 per month).
For the six months ended January 31, 2004, the administrator received fees of
$15,600 from the Fund for administrative services provided to the Fund. Certain
Trustees and the officers of the Trust are members of management and employees
of Unified, and/or shareholders of Unified Financial Services, Inc., the parent
of Unified.
Dobson Covered Call Fund
Notes to the Financial Statements
January 31, 2004 - continued
(Unaudited)
NOTE 3. FEES AND OTHER TRANSACTIONS WITH AFFILIATES - continued
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
$938). For the six months ended January 31, 2004, Unified received fees of
$5,144 from the Fund for transfer agent services provided to the Fund and $962
in reimbursement for out-of-pocket expenses incurred in providing transfer agent
services 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, 2004, Unified received fees
of $6,089 from the Fund for fund accounting services provided to the Fund.
The Fund retains Unified Financial Securities, Inc. (the "Distributor) to
act as the principal distributor of its shares. 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. 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.
NOTE 4. INVESTMENTS
For the six months ended January 31, 2004, purchases and sales of investment
securities, other than short-term investments and short-term U.S. government
obligations were as follows:
Purchases
U.S. Government Obligations
Sales $ - Other 622,695
U.S. Government Obligations
$ - Other 10,259
As of January 31, 2004, the net unrealized depreciation of investments for tax
purposes was as follows:
Gross Appreciation $ 669,633
Gross (Depreciation) (546,540)
---------------
Net Appreciation
on Investments $ 123,093
===============
At January 31, 2004, the aggregate cost of securities for federal income tax
purposes was $5,730,670.
Dobson Covered Call Fund
Notes to the Financial Statements
January 31, 2004 - continued
(Unaudited)
NOTE 5. ESTIMATES
Preparation of financial statements in accordance with accounting principals
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and 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, 2004,
Pershing LLC held 69.53% of the Fund in an omnibus account for the benefit of
others.
NOTE 7. CALL OPTIONS WRITTEN
As of January 31, 2004, portfolio securities valued at $5,344,664 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, 2004 were as
follows:
Number of Premiums
Contracts Received
Options outstanding at July 31, 2003 1,132 187,668
Options written 1,724 308,964
Options terminated in closing purchase transactions (1,041) (178,644)
Options expired (553) (90,973)
Options exercised (55) (13,174)
------------- ------------
Options outstanding at January 31, 2004 1,207 $213,840
NOTE 8. DISTRIBUTION TO SHAREHOLDERS
On December 11, 2002, an income distribution of $0.0195 per share and capital
gain distribution of $0.4569 were declared. The dividends were paid on December
12, 2002 to shareholders of record on December 11, 2002.
The tax character of distributions paid during the fiscal years ended July 31,
2003 and 2002 were as follows:
Distributions paid from: 2003 2002
------------- ------------
Ordinary Income $ 3,978 $ 5,586
Short-Term Capital Gain 93,218 176,278
Long-Term Capital Gain - 2,546
------------- ------------
$ 97,196 $184,410
============= ============
Dobson Covered Call Fund
Notes to the Financial Statements
July 31, 2003 - continued
(Unaudited)
NOTE 8. DISTRIBUTION TO SHAREHOLDERS - continued
The Fund paid no distributions during the six-months ended January 31, 2004.
As of July 31, 2003, 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) 453
Unrealized appreciation/(depreciation) (482,928)
---------------
$ (482,475)
===============
The difference between book basis and tax basis unrealized appreciation
(depreciation) is attributable to the tax deferral of wash sales and
post-October losses.
As of January 31, 2004, the components of distributable earnings/ (accumulated
losses) on a tax basis were as follows:
Undistributed accumulated net investment income (loss) $ (3,319)
Net realized appreciation (depreciation) on investments (209,994)
Net unrealized appreciation (depreciation) 123,093
---------------
$ (90,220)
===============
NOTE 9. CHANGE OF AUDITORS
On March 14, 2004, Cohen McCurdy, Ltd. ("Cohen") was selected to replace McCurdy
& Associates CPA's, Inc. ("McCurdy") as the Fund's independent auditor for the
2004 fiscal year. The Trust's selection of Cohen was approved by both the Audit
Committee and the Board of Trustees.
McCurdy's report on the Fund's financial statements as of July 31, 2003 did not
contain an adverse opinion or a disclaimer of opinion and was not qualified or
modified as to uncertainty, audit scope or accounting principles. At the
financial statement's date and through the date of the engagement of Cohen,
there were no disagreements between the Fund and McCurdy on any matter of
accounting principles or practices, financial statement disclosure, or auditing
scope or procedures, which such disagreements, if not resolved to the
satisfaction of McCurdy, would have caused it to make reference to the subject
matter of the disagreement in connection with its reports on the financial
statements for such years.
PROXY VOTING
A description of the policies and procedures that the Fund uses to determine how
to vote proxies relating to portfolio securities is available without charge
upon request by calling the Fund at 1-877-546-3066.
TRUSTEES
Timothy L. Ashburn, Chairman
Gary E. Hippenstiel
Stephen A. Little
Daniel J. Condon
Ronald C. Tritschler
OFFICERS
Timothy L. Ashburn, President and Asst. Secretary
Thomas G. Napurano, Chief Financial Officer and Treasurer
Carol J. Highsmith, Secretary
INVESTMENT ADVISOR
Dobson Capital Management, Inc.
1422 S. Van Ness Street
Santa Ana, California 92707
877-2-DOBSON (877-236-2766)
www.dobsoncapital.com
DISTRIBUTOR
Unified Financial Securities, Inc.
431 N. Pennsylvania Street
Indianapolis, Indiana 46204
INDEPENDENT ACCOUNTANTS
Cohen McCurdy, LTD.
27955 Clemens Rd.
Westlake, OH 44145
LEGAL COUNSEL
Thompson Hine LLP
312 Walnut St., Suite 1400
Cincinnati, OH 45202
CUSTODIAN
UMB Bank, N.A.,
928 Grand Blvd., 10th floor,
Kansas City, Missouri 64106
ADMINISTRATOR, TRANSFER AGENT
AND FUND ACCOUNTANT
Unified Fund Services, Inc.
431 N. Pennsylvania Street
Indianapolis, Indiana 46204
This report is intended only for the information of shareholders or those who
have received the Fund's prospectus which contains information about the Fund's
management fee and expenses. Please read the prospectus carefully before
investing.
Distributed by Unified Financial Securities, Inc.
Member NASD/SIPC
2. Code of Ethics. Not Applicable
Item 3. Audit Committee Financial Expert. Not Applicable
Item 4. Principal Accountant Fees and Services. Not Applicable
Item 5. Audit Committee of Listed Companies. Not applicable.
Item 6. Reserved.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Funds.
Not applicable.
Item 8. Purchases of Equity Securities by Closed-End Funds. Not applicable.
Item 9. Submission of Matters to a Vote of Security Holders. Not Applicable
Item 10.Controls and Procedures.
(a) Based on an evaluation of the registrant's disclosure controls and
procedures as of January 9, 2004, the disclosure controls and procedures are
reasonably designed to ensure that the information required in filings on Forms
N-CSR is recorded, processed, summarized, and reported on a timely basis.
(b) There were no significant changes in the registrant's internal control over
financial reporting that occurred during the registrant's last fiscal half-year
that have materially affected, or are reasonably likely to materially affect,
the registrant's internal control over financial reporting.
Item 11. Exhibits.
(a)(1) Not Applicable
(a)(2) Certifications by the registrant's principal executive officer and
principal financial officer, pursuant to Section 302 of the Sarbanes- Oxley Act
of 2002 and required by Rule 30a-2(a) under the Investment Company Act of 1940
are filed herewith.
(a)(3) Not Applicable
(b) Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002 is filed herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Ameriprime Funds_
By
*
Timothy Ashburn, President
Date
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, President____________________________________________
Timothy Ashburn, President
Date April 12, 2004
By /s/ Thomas Napurano, Treasurer and Chief Financial Officer
*
Thomas Napurano, Treasurer and Chief Financial Officer
Date April 12, 2004