ANNUAL REPORT
SEPTEMBER 30, 1998
THE ROCKLAND GROWTH FUND
RETAIL CLASS
INSTITUTIONAL CLASS
ANNUAL REPORT
November 19, 1998
Dear Fellow Shareholders,
With the Federal Reserve cutting interest rates three times in the last month
or so, we believe that the stock market is getting the fuel necessary for
another leg up. Since our quarterly letter on September 30, the small cap market
went through a climactic downdraft, but came roaring back on very strong volume.
We continue to have significant net new additions to client investments in the
Rockland Growth Fund, which is testimony to the confidence that our shareholders
have in our small cap growth stock investment selections.
To clarify our capital gains situation, it appears that there will be a net
loss in the Fund of approximately half a million dollars which can be carried
forward to offset gains in future tax years. So despite having a positive return
for the calendar year to date at the time of this letter, you can be assured
that you will pay no taxes for 1998.
We wish all of you the very best holiday season and we will update you again
after the calendar year-end.
Thank you for your support,
/s/ Richard H. Gould /s/ Charles S. Cruice
Richard H. Gould CFA CMT Charles S. Cruice
GREENVILLE CAPITAL MANAGEMENT, INC.
Presents
THE ROCKLAND GROWTH FUND
a Series of
The Rockland Funds Trust o P. O. Box 701 o Milwaukee, Wisconsin 53201-0701
o 1-800-497-3933
Rockland Growth Fund--
date Institutional S&P 500 NASDAQ Composite
12/2/96 $10,000 $10,000 $10,000
3/31/97 $9,004 $10,065 $9,459
9/30/97 $14,452 $12,707 $13,084
3/31/98 $13,661 $14,896 $14,265
9/30/98 $11,532 $13,856 $13,179
Rockland Growth Rockland Growth
Fund -- Fund -- NASDAQ
date Retail Load Retail No Load S&P 500 Composite Russell 2000
12/2/96 $10,000 $10,000 $10,000 $10,000 $10,000
3/31/97 $8,711 $8,980 $10,065 $9,459 $9,731
9/30/97 $13,987 $14,420 $12,707 $13,084 $12,992
3/31/98 $13,200 $13,609 $14,896 $14,265 $13,820
9/30/98 $11,129 $11,473 $13,856 $13,179 $10,521
FOR THE PERIOD ENDED SEPTEMBER 30, 1998
ANNUALIZED SINCE
ONE YEAR COMMENCEMENT OF OPERATIONS
-------- --------------------------
Rockland Growth Fund -- Institutional (20.21)% 8.11%
Rockland Growth Fund -- Retail No Load (20.44)% 7.81%
Rockland Growth Fund -- Retail Load (22.85)% 6.02%
S&P 500 9.05% 19.51%
NASDAQ Composite 0.73% 16.28%
Russell 2000 (18.90)% 2.81%
The Standard & Poor's 500 Index (S&P 500) is a capital-weighted index,
representing the aggregate market value of the common equity of 500 stocks
primarily traded on the New York Stock Exchange. The NASDAQ Composite Index is
a broad-based capitalization-weighted index of all NASDAQ stocks. The Russell
2000 is an unmanaged index of 2,000 stocks weighted by market capitalization.
This chart assumes an initial gross investment of $10,000 made on 12/2/96
(commencement of operations). Returns shown include the reinvestment of all
dividends. Past performance is not predictive of future performance.
Investment return and principal value will fluctuate, so that your shares, when
redeemed, may be worth more or less than the original cost.
ROCKLAND GROWTH FUND
INDEPENDENT AUDITOR'S REPORT
The Shareholders and Board of Trustees
The Rockland Funds Trust
We have audited the accompanying statement of assets and liabilities of
Rockland Growth Fund (the "Fund"), including the schedule of investments, as of
September 30, 1998, and the related statement of operations for the year then
ended, statements of changes in net assets for the two year period then ended
and financial highlights for the periods presented herein. These financial
statements and financial highlights are the responsibility of the Fund's
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audit in accordance with generally accepted auditing
standards. 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 misstatements. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights. Our procedures included confirmation of
securities owned, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our 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
Fund as of September 30, 1998 and the results of operations, changes in its net
assets and the financial highlights for each of the periods referred to above,
in conformity with generally accepted accounting principles.
/s/ KPMG Peat Marwick LLP
Milwaukee, Wisconsin
October 14, 1998
ROCKLAND GROWTH FUND
STATEMENT OF ASSETS AND LIABILITIES -- SEPTEMBER 30, 1998
ASSETS:
Investments, at value (cost $10,340,365) $ 11,201,112
Deposits with brokers for securities sold short 59,871
Receivable for investments sold 1,153,690
Receivable for capital shares sold 5,010
Dividends and interest receivable 7,605
Receivable from Advisor 5,145
Organizational expenses, net of accumulated amortization 21,519
Other assets 4,128
------------
Total Assets 12,458,080
------------
LIABILITIES:
Payable for investments purchased 512,450
Securities sold short at value (proceeds of $87,660) 89,063
Accrued expenses and other liabilities 37,845
------------
Total Liabilities 639,358
------------
NET ASSETS $ 11,818,722
------------
------------
NET ASSETS CONSIST OF:
Capital stock 11,611,048
Accumulated net realized loss on investments sold (651,670)
Net unrealized appreciation (depreciation) on:
Investments 860,747
Short positions (1,403)
------------
Total Net Assets $ 11,818,722
------------
------------
RETAIL CLASS:
Net assets $ 1,137,385
Shares of beneficial interest outstanding
(unlimited shares of $.001 par value authorized) 101,847
Net asset value and redemption price per share $ 11.17
------------
------------
Maximum offering price per share $ 11.52
------------
------------
INSTITUTIONAL CLASS:
Net assets $10,681,337
Shares of beneficial interest outstanding
(unlimited shares of $.001 par value authorized) 953,164
Net asset value, redemption price and
offering price per share $ 11.21
------------
------------
See notes to the financial statements.
ROCKLAND GROWTH FUND
STATEMENT OF OPERATIONS -- YEAR ENDED SEPTEMBER 30, 1998
INVESTMENT INCOME:
Dividend income (net of foreign taxes withheld of $34) $ 4,823
Interest income 26,994
------------
Total investment income 31,817
------------
EXPENSES:
Investment advisory fee 123,072
Administration fee 47,271
Shareholder servicing and accounting costs 67,997
Custody fees 13,817
Federal and state registration 16,692
Professional fees 21,343
Reports to shareholders 6,594
Trustees' fees and expenses 2,920
Amortization of organizational expenses 6,935
Distribution expenses -- Retail Class 3,019
Other 13,327
------------
Total operating expenses before reimbursement 322,987
Less: Reimbursement from Adviser (107,092)
------------
Total expenses 215,895
------------
NET INVESTMENT LOSS (184,078)
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Realized gain (loss) on:
Long transactions (395,128)
Short transactions 79,004
Change in unrealized appreciation/depreciation on:
Investments (2,270,961)
Short positions (1,403)
------------
Net realized and unrealized loss on investments (2,588,488)
------------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS $ (2,772,566)
------------
------------
See notes to the financial statements.
ROCKLAND GROWTH FUND
STATEMENTS OF CHANGES IN NET ASSETS
DECEMBER 2, 1996(1)<F1>
YEAR ENDED THROUGH
SEPTEMBER 30, 1998 SEPTEMBER 30, 1997
------------------ ------------------
OPERATIONS:
Net investment loss $ (184,078) $ (60,498)
Net realized gain (loss) on:
Long transactions (395,128) 54,223
Short transactions 79,004 --
Change in unrealized appreciation/
depreciation on:
Investments (2,270,961) 3,131,708
Short positions (1,403) --
----------- -----------
Net increase (decrease)
in net assets resulting
from operations (2,772,566) 3,125,433
----------- -----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 3,339,381 8,838,306
Shares issued to holders in
reinvestment of dividends 270,117 2,509
Cost of shares redeemed (517,134) (182,299)
----------- -----------
Net increase in net assets
resulting from capital
share transactions 3,092,364 8,658,516
----------- -----------
DISTRIBUTIONS TO RETAIL CLASS
SHAREHOLDERS:
In excess of net realized gains (14,424) --
Return of capital (11,862) --
----------- -----------
(26,286) --
DISTRIBUTIONS TO INSTITUTIONAL CLASS
SHAREHOLDERS:
In excess of net investment income -- (3,001)
In excess of net realized gains (140,328) --
Return of capital (115,410) --
----------- -----------
(255,738) (3,001)
NET INCREASE IN NET ASSETS 37,774 11,780,948
NET ASSETS:
Beginning of period 11,780,948 0
----------- -----------
End of period $11,818,722 $11,780,948
----------- -----------
----------- -----------
(1)<F1>Commencement of operations.
See notes to the financial statements.
ROCKLAND GROWTH FUND
FINANCIAL HIGHLIGHTS
<TABLE>
DECEMBER 2, 1996(1)<F2>
YEAR ENDED THROUGH
SEPTEMBER 30, 1998 SEPTEMBER 30, 1997
----------------------- -------------------------
RETAIL INSTITUTIONAL RETAIL INSTITUTIONAL
CLASS CLASS CLASS CLASS
------ -------------- ------ --------------
<S> <C> <C> <C> <C>
Per Share Data:
Net asset value, beginning of period $ 14.42 $ 14.43 $ 10.00 $ 10.00
------ ------ ------ ------
Income from investment operations:
Net investment loss (0.20)(7)<F8> (0.17)(7)<F8> (0.15)(8)<F9> (0.11)(8)<F9>
Net realized and unrealized gains
(losses) on investments (2.73) (2.73) 4.57 4.56
------ ------ ------ ------
Total from investment operations (2.93) (2.90) 4.42 4.45
------ ------ ------ ------
Less distributions:
Dividends in excess of net investment income -- -- -- (0.02)
Distributions in excess of net realized gains (0.18) (0.18) -- --
Return of capital (0.14) (0.14) -- --
------ ------ ------ ------
Total distributions (0.32) (0.32) -- (0.02)
------ ------ ------ ------
Net asset value, end of period $ 11.17 $ 11.21 $ 14.42 $ 14.43
------ ------ ------ ------
------ ------ ------ ------
Total return (2)<F3>(3)<F4> (20.44%) (20.21%) 44.20% 44.53%
Supplemental data and ratios:
Net assets, end of period $1,137,385 $10,681,337 $921,991 $10,858,957
Ratio of operating expenses to
average net assets(4)<F5>(5)<F6> 2.00% 1.75% 2.00% 1.75%
Ratio of net investment loss to
average net assets(4)<F5>(5)<F6> (1.72%) (1.47%) (1.36%) (1.11%)
Portfolio turnover rate (6)<F7> 353.27% 353.27% 204.05% 204.05%
</TABLE>
(1)<F2> Commencement of operations.
(2)<F3> Not annualized for the period December 2, 1996 through September 30,
1997.
(3)<F4> The total return does not reflect the 3% front-end sales charge for
the Retail Class.
(4)<F5> Annualized for the period December 2, 1996 through September 30, 1997.
(5)<F6> Without expense reimbursements of $107,092 and $120,419 for the year
ended September 30, 1998 and the period December 2, 1996 through
September 30, 1997, respectively, the ratio of operating expenses to
average net assets would have been 2.85% and 4.23% for the Retail
class and 2.60% and 3.98% for the Institutional class, respectively.
The ratio of net investment loss to average net assets would have been
(2.57%) and (3.60%) for the Retail class and (2.32%) and (3.35%) for
the Institutional class, respectively.
(6)<F7> Portfolio turnover is calculated on the basis of the Fund as a whole
without distinguishing between the classes of shares issued.
(7)<F8> Net investment loss per share is calculated using ending balances
prior to consideration of adjustments for permanent book and tax
differences.
(8)<F9> Net investment loss per share represents net investment loss divided
by the monthly average shares of beneficial interest outstanding
throughout the period December 2, 1996 through September 30, 1997.
See notes to the financial statements.
ROCKLAND GROWTH FUND
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 1998
SHARES VALUE
------ -----
COMMON STOCKS -- 86.0%
BUSINESS SERVICES -- 16.3%
20,000 Century Business Services, Inc.*<F8> $ 407,500
14,000 Dendrite International, Inc.*<F8> 334,250
5,000 INSpire Insurance Solutions, Inc.*<F8> 118,125
4,000 Mail-Well, Inc.*<F8> 34,250
13,000 META Group, Inc.*<F8> 424,937
12,000 National Computer Systems, Inc. 354,000
4,000 Personnel Group of America, Inc.*<F8> 49,250
5,000 Service Experts, Inc.*<F8> 139,063
3,000 Tetra Tech, Inc.*<F8> 67,500
----------
1,928,875
----------
COMPUTERS -- 13.2%
5,000 Cybex Computer Products Corporation*<F8> 125,625
4,000 Dell Computer Corporation *<F8> 263,000
7,000 Jack Henry & Associates, Inc. 334,250
7,000 Kronos Incorporated *<F8> 259,000
5,000 PC Connection, Inc.*<F8> 51,250
3,000 Rambus Inc.*<F8> 192,000
6,000 VERITAS Software Corporation *<F8> 331,500
----------
1,556,625
----------
CONSUMER PRODUCTS -- 0.4%
5,000 Oakley, Inc.*<F8> 48,125
----------
DISTRIBUTION -- 2.8%
8,000 U.S. Foodservice, Inc.*<F8> 333,000
----------
ELECTRONICS -- 3.0%
7,000 Symbol Technologies, Inc. 359,188
----------
FINANCIAL SERVICES -- 3.3%
15,000 Concord EFS, Inc.*<F8> 387,188
----------
FOOD, BEVERAGES & TOBACCO -- 2.6%
10,000 The Earthgrains Company 309,375
----------
HEALTH CARE SERVICES -- 0.7%
2,000 Assisted Living Concepts, Inc.*<F8> 28,375
3,000 Stericycle, Inc.*<F8> 59,250
----------
87,625
----------
HEALTH CARE INFORMATION SYSTEMS -- 6.3%
4,000 ADAC Laboratories 96,000
5,000 Eclipsys Corporation*<F8> 114,375
10,000 IDX Systems Corporation*<F8> 530,000
----------
740,375
----------
INTERNET -- 1.1%
1,000 Yahoo! Inc.*<F8> 129,500
----------
MEDICAL PRODUCTS -- 1.3%
1,000 MiniMed Inc.*<F8> 66,000
2,000 Xomed Surgical Products, Inc.*<F8> 82,250
----------
148,250
----------
RESTAURANTS -- 3.0%
9,000 Tricon Global Restaurants, Inc.*<F8> 351,000
----------
RETAIL -- 1.5%
3,000 Rent-Way, Inc.*<F8> 73,875
5,000 Sonic Automotive, Inc.*<F8> 99,062
----------
172,937
----------
SAVINGS & LOANS -- 2.0%
15,000 TeleBanc Financial Corporation*<F8> 241,875
----------
SEMICONDUCTORS -- 5.5%
6,000 Maxim Integrated Products, Inc.*<F8> 167,250
20,000 TranSwitch Corporation*<F8> 298,750
8,000 Vitesse Semiconductor Corporation*<F8> 189,000
----------
655,000
----------
SOFTWARE -- 20.2%
2,000 BMC Software, Inc.*<F8> 120,125
8,000 Best Software, Inc.*<F8> 192,000
9,000 Compuware Corporation*<F8> 529,875
10,000 Concord Communications, Inc.*<F8> 397,500
3,000 J.D. Edwards & Company*<F8> 144,000
6,000 Legato Systems, Inc.*<F8> 308,250
10,000 Mercury Interactive Corporation*<F8> 396,875
2,000 Peregrine Systems, Inc.*<F8> 80,500
2,000 Policy Management Systems Corporation*<F8> 81,000
4,000 TSI International Software Ltd.*<F8> 138,500
----------
2,388,625
----------
TELECOMMUNICATIONS -- 1.6%
3,000 Dycom Industries, Inc.*<F8> 93,375
2,000 Gilat Satellite Networks Ltd.*<F8> 90,000
----------
183,375
----------
TEXTILES & APPAREL -- 1.2%
4,000 WestPoint Stevens, Inc.*<F8> 122,000
2,000 Wolverine World Wide, Inc. 21,750
----------
143,750
----------
TOTAL COMMON STOCKS (Cost $9,303,941) 10,164,688
----------
SHORT-TERM INVESTMENTS -- 8.8%
PRINCIPAL
SHARES VALUE
------ -----
VARIABLE RATE DEMAND NOTES#<F9> -- 8.8%
$262,000 American Family Financial Services Inc., 4.9628% 262,000
575,000 Firstar Bank, 5.0937% 575,000
134,760 Warner-Lambert Co., 4.9630% 134,760
64,664 Wisconsin Electric Power Company, 4.9628% 64,664
----------
TOTAL SHORT-TERM INVESTMENTS (Cost $1,036,424) 1,036,424
----------
TOTAL INVESTMENTS -- (COST OF $10,340,365) 11,201,112
SECURITIES SOLD SHORT -- (0.8)%
5,000 TJX Companies, Inc. (89,063)
----------
TOTAL SECURITIES SOLD SHORT (PROCEEDS $87,660) (89,063)
----------
Other Assets, less Liabilities - 6.0% 706,673
----------
TOTAL NET ASSETS - 100.0% $11,818,722
----------
----------
*<F8> Non-income producing security.
#<F9> Variable rate demand notes are considered short-term obligations and
are payable on demand.
Interest rates change periodically on specified dates. The rates
listed are as of September 30, 1998.
See notes to the financial statements.
ROCKLAND GROWTH FUND
NOTES TO THE FINANCIAL STATEMENTS -- SEPTEMBER 30, 1998
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
The Rockland Funds Trust (the "Trust") was organized on July 31, 1996, as a
Delaware business trust and is registered as an open-end management
investment company under the Investment Company Act of 1940 ("1940 Act").
The Trust currently consists of one series, The Rockland Growth Fund (the
"Fund"). The investment objective of the Fund is to seek capital
appreciation. In seeking its investment objective of capital appreciation,
the Fund will, under normal market conditions, invest primarily in equity
securities of domestic companies. The Fund is structured for flexibility
and risk reduction, but centered around investment in high quality growth
stocks with an emphasis on those companies whose growth potential, in the
opinion of the Fund's investment adviser, GREENVILLE CAPITAL MANAGEMENT,
INC., has been overlooked by Wall Street analysts. The Fund issued and sold
10,000 Institutional shares of its capital stock at $10 per share on
October 21, 1996. The Fund commenced operations on December 2, 1996.
The costs incurred in connection with the organization, initial
registration and public offering of shares, aggregating $34,078, have been
paid by the Adviser. The Fund has reimbursed the Adviser. These costs are
being amortized over the period of benefit, but not to exceed sixty months
from the Fund's commencement of operations.
The Fund has issued two classes of shares: Retail and Institutional. The
Retail shares are subject to a 0.25% 12b-1 fee and an initial sales charge
imposed at the time of purchase, in accordance with the Fund's prospectus.
The maximum sales charge is 3% of the offering price or 3.09% of the net
asset value. Each class of shares has identical rights and privileges
except with respect to 12b-1 fees paid by Retail shares and voting rights
on matters affecting a single class of shares.
The following is a summary of significant accounting policies consistently
followed by the Fund.
a) Investment Valuation - Common stocks, other equity-type securities, and
securities sold short that are listed on a security exchange or quoted
on NASDAQ are valued at the last quoted sales price on which such
securities are primarily traded. Common stocks, other equity-type
securities, and securities sold short which are listed on an exchange
or the NASDAQ Stock Market but which are not traded on the valuation
date are valued at the mean between the current bid and asked price.
Options purchased or written by the Fund are valued at the average of
the current bid and asked prices. Mutual fund investments are valued at
the net asset value on the day the valuation is made. Other assets and
securities for which no quotations are readily available are valued at
fair value as determined in good faith by management in accordance with
procedures approved by the Board of Trustees. Debt securities (those
with remaining maturities of 60 days or less) are valued at amortized
cost, which approximates market value.
b) Federal Income Taxes - It is the Fund's policy to comply with the
requirements of the Internal Revenue Code applicable to regulated
investment companies and to distribute all of its taxable net income as
well as any net realized gains to its shareholders. Therefore, no
federal income tax provision is required.
c) Distributions to Shareholders - Dividends from net investment income
are declared and paid annually in December. Distributions of net
realized capital gains, if any, will be declared at least annually and
distributed in December. Distributions from net realized gains for
book purposes may include short-term capital gains which are included
as ordinary income to shareholders for tax purposes.
Generally accepted accounting principles require that permanent
differences between financial reporting and tax reporting be
reclassified between various components of net assets. On the statement
of assets and liabilities, as a result of permanent book-to-tax
differences, $137,126 has been reclassified from capital with $184,078
posted to accumulated undistributed net investment income and $46,952
posted from accumulated net realized loss. These differences relate to
the use of the net operating loss as an offset against short-term gains
for tax purposes and the amortization of organization costs for tax
purposes.
Net investment income and realized gains and losses for federal income
tax purposes may differ from that reported on the financial statements
because of temporary book and tax basis differences. Temporary
differences are primarily the result of losses from wash sales.
Temporary differences also result from post-October 31 losses of
$535,559, which are not recognized for tax purposes until the first day
of the following fiscal year.
On December 31, 1996, a dividend of $3,001 was paid to Institutional
shareholders of record on December 30, 1996. There were no Retail
shareholders as of the record date.
d) Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.
e) Foreign Securities - Investing in securities of foreign companies and
foreign governments involves special risks and considerations not
typically associated with investing in U.S. companies and the U.S.
government. These risks include revaluation of currencies and future
adverse political and economic developments. Moreover, securities of
many foreign companies and foreign governments and their markets may be
less liquid and their prices more volatile than those of securities of
comparable U.S. companies and the U.S. government.
f) Other - Investment and shareholder transactions are recorded on trade
date. The Fund determines the gain or loss realized from investment
transactions by comparing the original cost of the security lot sold
with the net sales proceeds. Dividend income is recognized on the ex-
dividend date or as soon as information is available to the Fund, and
interest income is recognized on an accrual basis.
2. SHARES OF BENEFICIAL INTEREST
Transactions in shares of beneficial interest for the year ending September
30, 1998 were as follows:
$ SHARES
-- ------
RETAIL SHARES:
Shares sold $ 622,498 47,437
Shares issued to holders in
reinvestment of dividends 24,156 2,074
Shares redeemed (149,376) (11,613)
---------- ---------
Net increase $ 497,278 37,898
----------
----------
SHARES OUTSTANDING:
Beginning of period 63,949
---------
end of period 101,847
---------
---------
INSTITUTIONAL SHARES:
Shares sold $2,716,883 210,145
Shares issued to holders in
reinvestment of dividends 245,961 21,094
Shares redeemed (367,758) (30,773)
---------- ---------
Net increase 2,595,086 200,466
----------
----------
SHARES OUTSTANDING:
Beginning of period 752,698
---------
end of period 953,164
---------
---------
TOTAL INCREASE $3,092,364 1,055,011
---------- ---------
---------- ---------
3. INVESTMENT TRANSACTIONS
The aggregate purchases and sales of investments, excluding short-term
investments and short positions, by the Fund for the year ended September
30, 1998, were $41,069,616 and $40,225,051, respectively.
At September 30, 1998, gross unrealized appreciation and depreciation of
investments for tax purposes were as follows:
Appreciation $1,147,101
(Depreciation) (402,466)
----------
Net appreciation on investments $744,635
----------
----------
At September 30, 1998, the cost of investments for federal income tax
purposes was $10,456,477.
4. INVESTMENT ADVISORY AND OTHER AGREEMENTS
The Trust, on behalf of the Fund, has entered into an Investment Advisory
Agreement with Greenville Capital Management, Inc. Pursuant to its advisory
agreement with the Trust, the Investment Adviser is entitled to receive a
fee, calculated daily and payable monthly, at the annual rate of 1.00% as
applied to the Fund's daily net assets.
The Investment Adviser has voluntarily agreed to waive its management fee
and/or reimburse the operating expenses to the extent necessary to insure
that the total operating expenses do not exceed 2.00% and 1.75% of the
Fund's average daily net assets for the Retail class and Institutional
class, respectively.
Firstar Mutual Fund Services, LLC serves as transfer agent, administrator
and accounting services agent for the Fund. Firstar Bank Milwaukee, N.A.
serves as custodian for the Fund.
5. SHORT POSITIONS
As a portfolio management strategy, the Fund may engage in short sales of
securities, which result in obligations of the Fund to make a future
delivery of a specific security. These obligations are subject to the risk
that the security's market price at the delivery date will exceed the
amount of proceeds initially received, and that the Fund may be required to
purchase the security at prevailing market prices (or deliver the security
if owned by the Fund) and thus realize a loss on the transaction.
Obligations under short sales are reported as liabilities and are adjusted
to the current market value of the security to be delivered. The Fund
generally maintains deposits with brokers approximating the market value of
securities sold short. At September 30, 1998, the Fund had 0.8% of its net
assets in short positions.
6. DISTRIBUTION PLAN
The Fund has adopted a plan pursuant to Rule 12b-1 under the 1940 Act (the
"Plan"), which requires the Retail class to pay the Distributor a
distribution fee of up to 0.25% of its average daily net assets computed on
an annual basis. Under the terms of the Plan, the Distributor is authorized
to, in turn, pay all or a portion of this fee to any securities dealer,
financial institution or any other person who renders assistance in
distributing or promoting the sale of Retail class shares pursuant to a
written agreement. To the extent such fee is not paid to such persons, the
Distributor may use the fee for its own distribution expenses incurred in
connection with the sale of the shares, although it is the Distributor's
current intention to pay out all or most of the fee. The Fund has incurred
$3,019 pursuant to the Plan for the year ended September 30, 1998.
TRUSTEES
Mr. Charles Cruice
Mr. Richard Gould
Dr. Peter Utsinger
Mr. Robert Harrison
Mr. Richard Vague
OFFICERS
Mr. Charles Cruice, President
Mr. Richard Gould, Treasurer
Mr. Jeffrey Rugen, Secretary
INVESTMENT ADVISOR
Greenville Capital Management, Inc.
100 South Rockland Falls Road
Rockland, DE 19732
CUSTODIAN
Firstar Bank Milwaukee, N.A.
P.O. Box 701
777 E. Wisconsin Avenue
Milwaukee, WI 53202
ADMINISTRATOR, TRANSFER AGENT
AND DIVIDEND-DISBURSING AGENT
Firstar Mutual Fund Services, LLC
P.O. Box 701
Third Floor
615 East Michigan Street
Milwaukee, WI 53202
INDEPENDENT ACCOUNTANTS
KPMG Peat Marwick LLP
777 E. Wisconsin Avenue
Milwaukee, WI 53202
LEGAL COUNSEL
Godfrey & Kahn, S.C.
780 N. Water Street
Milwaukee, WI 53202
