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Previous: LOG ON AMERICA INC, S-3/A, EX-23.2, 2000-08-29 |
Next: SELECT TEN PLUS FUND LLC, NSAR-A, 2000-08-29 |
<PAGE>
Select Ten Plus Fund, LLC
Semi-Annual Report
June 30, 2000
Contents
President's Letter............................................................ii
Financial Statements, Financial Highlights, and Schedule of
Investments:
Select Ten Plus Portfolio-March ...........................................1
Select Ten Plus Portfolio-June, ...........................................4
Select Ten Plus Portfolio-September........................................7
Select Ten Plus Portfolio-December........................................10
Notes to Financial Statements.................................................13
THIS REPORT AND THE FINANCIAL STATEMENTS CONTAINED HEREIN ARE SUBMITTED FOR THE
GENERAL INFORMATION OF THE SHAREHOLDERS OF THE FUND. THIS REPORT IS NOT
AUTHORIZED FOR DISTRIBUTION TO PROSPECTIVE INVESTORS IN THE FUND UNLESS PRECEDED
OR ACCOMPANIED BY AN EFFECTIVE PROSPECTUS. NEITHER THE FUND NOR TOUCHSTONE
SECURITIES CORPORATION, THE PRINCIPAL UNDERWRITER FOR FUND UNITS, IS A BANK AND
FUND UNITS ARE NOT BACKED OR GUARANTEED BY ANY BANK OR INSURED BY THE FEDERAL
DEPOSITORY INSURANCE CORPORATION.
<PAGE>
SELECT TEN PLUS FUND, LLC
--------------------------------------------------------------------------------
July 20, 2000
Dear Shareholders:
Enclosed is the Select Ten Plus Fund, LLC annual report for the fiscal period
ended June 30, 2000. The report includes details on the investment holdings in
the June, September, and December Portfolios of Select Ten Plus Fund, LLC as of
June 30, 2000, as well as other pertinent financial information.
Select Ten Plus Fund, LLC follows the popular investment methodology often
referred to as the "Dow Ten" or the "Dow Dividend Strategy." Select Ten Plus
Fund, LLC is dedicated to assisting you in achieving your long-term investment
goals.
Thank you for your confidence. If you have any questions or comments, please
contact us at your convenience.
Sincerely,
/s/ Edward J. Haines
Edward J. Haines
President
ii
<PAGE>
Select Ten Plus Portfolio - March
Statement of Assets and Liabilities
Unaudited
<TABLE>
<CAPTION>
JUNE 30, 2000
----------------------
<S> <C>
ASSETS
Investments in securities, at value (cost $0 )--See accompanying schedule $ --
Cash 36
Dividends, interest and other receivables 8,059
----------------------
TOTAL ASSETS $ 8,095
LIABILITIES
Accrued expenses 8,095
----------------------
TOTAL LIABILITIES 8,095
----------------------
NET ASSETS $ --
======================
Net Assets consist of:
Paid-in capital $ 136
Accumulated net realized loss on investments (136)
----------------------
NET ASSETS $ --
======================
NET ASSET VALUE, offering and redemption price per share $ --
======================
Shares outstanding --
======================
</TABLE>
Statement of Operations
Unaudited
<TABLE>
<CAPTION>
MARCH 31, 2000
(COMMENCEMENT OF
OPERATIONS) THROUGH
JUNE 30, 2000
----------------------
<S> <C>
INVESTMENT INCOME - DIVIDENDS $ 33
EXPENSES
Custody and accounting expenses 4,169
Directors' fees and expenses 1,284
Professional fees 1,027
Errors and omissions insurance 755
Printing and filing fees 677
Investment advisory and management fees 7
Other expenses 255
----------------------
Total expenses before reimbursement 8,174
Less: expense reimbursement (8,128)
----------------------
Net expenses 46
----------------------
Net investment income (13)
Net realized and unrealized loss on investments (136)
----------------------
Net decrease in net assets resulting from operations $ (149)
======================
</TABLE>
SEE ACCOMPANYING NOTES.
1
<PAGE>
Select Ten Plus Portfolio - March
Statement of Changes in Net Assets
Unaudited
<TABLE>
<CAPTION>
MARCH 31, 2000
(COMMENCEMENT OF
OPERATIONS) THROUGH
JUNE 30, 2000
--------------------------
<S> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment loss $ (13)
Net realized loss on investments (136)
--------------------------
Net decrease in net assets resulting from operations (149)
Contract related transactions:
Contributions from contract holders (668 shares) 6,678
Cost of shares redeemed (668 shares) (6,529)
--------------------------
Net increase in net assets resulting from share transactions 149
--------------------------
Total increase in net assets --
NET ASSETS
Beginning of period --
--------------------------
End of period $ --
==========================
</TABLE>
SEE ACCOMPANYING NOTES.
Financial Highlights
Unaudited
<TABLE>
<CAPTION>
MARCH 31, 2000
(COMMENCEMENT OF
OPERATIONS) THROUGH
JUNE 30, 2000 (a)(b)
------------------------
<S> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 10.00
Loss from investment operations:
Net realized and unrealized loss on investments (10.00)
------------------------
Total from investment operations (10.00)
------------------------
Net asset value, end of period $ --
========================
TOTAL RETURN (100%)
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $ --
Ratio of net investment income to average net assets (0.76%)
Ratio of expenses to average net assets 2.68%
Ratio of net investment loss to average net assets before voluntary expense reimbursement (474.07%)
Ratio of expenses to average net assets before voluntary expense reimbursement 475.99%
Portfolio turnover rate --%
</TABLE>
PERCENTAGE AMOUNTS ARE ANNUALIZED, EXCEPT TOTAL RETURN AND PORTFOLIO TURNOVER
RATE.
(a) Effective March 3, 2000, Touchstone Advisors, Inc. replaced Integrity
Capital Advisors, Inc. as investment adviser for the Fund.
(b) Financial Highlights reflect the liquidation of the Fund due to redemptions
on June 13, 2000.
2
<PAGE>
Select Ten Plus Portfolio - March
Schedule of Investments
June 30, 2000
Unaudited
NOTE:
The March Portfolio liquidated on June 13, 2000 as a result of redemptions.
Therefore, there is no schedule of investments for the June 30, 2000
reporting period.
OTHER INFORMATION:
Cost of purchases and proceeds from sales of securities, excluding
short-term securities, for the period ended June 30, 2000 aggregated $6,194
and $6,058 respectively.
SEE ACCOMPANYING NOTES.
3
<PAGE>
Select Ten Plus Portfolio - June
Statement of Assets and Liabilities
Unaudited
<TABLE>
<CAPTION>
JUNE 30, 2000
----------------------
<S> <C>
ASSETS
Investments in securities, at value (cost $192,888)--See accompanying schedule $ 164,430
Receivable for investments sold 83,063
Due from investment advisor 29,443
Dividends receivable 322
----------------------
TOTAL ASSETS 277,258
LIABILITIES
Cash overdraft 2,913
Payable for investments purchased 79,827
Accrued expenses 14,559
----------------------
TOTAL LIABILITIES 97,299
----------------------
NET ASSETS $ 179,959
======================
Net Assets consist of:
Paid-in capital $ 242,342
Undistributed net investment income 5,873
Accumulated net realized loss on investments (39,798)
Net unrealized depreciation on investments (28,458)
----------------------
NET ASSETS $ 179,959
======================
NET ASSET VALUE, offering and redemption price per share $ 8.06
======================
Shares outstanding 22,336
======================
</TABLE>
Statement of Operations
Unaudited
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
JUNE 30, 2000
----------------------
<S> <C>
INVESTMENT INCOME - DIVIDENDS $ 3,294
EXPENSES
Custody and accounting expenses 10,052
Directors' fees and expenses 3,116
Professional fees 2,493
Errors and omissions insurance 1,831
Printing and filing fees 1,643
Investment advisory and management fees 571
Other expenses 623
----------------------
Total expenses before reimbursement 20,329
Less: expense reimbursement (19,358)
----------------------
Net expenses 971
----------------------
Net investment income 2,323
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss on investment securities (32,942)
Net unrealized appreciation during the period on investments 4,373
----------------------
Net realized and unrealized loss on investments (28,569)
----------------------
Net decrease in net assets resulting from operations $ (26,246)
======================
</TABLE>
SEE ACCOMPANYING NOTES.
4
<PAGE>
Select Ten Plus Portfolio - June
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
SIX MONTHS JUNE 30, 1999
ENDED (COMMENCEMENT OF
JUNE 30, 2000 OPERATIONS) THROUGH
(UNAUDITED) DECEMBER 31, 1999
----------------------- -----------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income $ 2,323 $ 3,550
Net realized loss on investments (32,942) (6,856)
Net unrealized appreciation (depreciation) during the period on 4,373 (32,831)
investments
----------------------- -----------------------
Net decrease in net assets resulting from operations (26,246) (36,137)
Contract related transactions:
Contributions from contract holders ( 0 and 47,905 shares, respectively) -- 480,220
Cost of shares redeemed (11,291 and 14,278 shares, respectively) (99,916) (137,962)
----------------------- -----------------------
Net increase (decrease) in net assets resulting from share
transactions (99,916) 342,258
----------------------- -----------------------
Total increase (decrease) in net assets (126,162) 306,121
NET ASSETS
Beginning of period 306,121 --
----------------------- -----------------------
End of period (including undistributed net investment income of $5,873
and $3,550, respectively) $ 179,959 $ 306,121
======================= =======================
</TABLE>
SEE ACCOMPANYING NOTES.
Financial Highlights
<TABLE>
<CAPTION>
SIX MONTHS JUNE 30, 1999
ENDED (COMMENCEMENT OF
JUNE 30, 2000 OPERATIONS) THROUGH
(UNAUDITED) (a) DECEMBER 31, 1999
----------------------- ----------------------
<S> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 9.10 $ 10.00
Loss from investment operations:
Net investment income -- 0.11
Net realized and unrealized loss on investments (1.04) (1.01)
----------------------- ----------------------
Total from investment operations (1.04) (0.90)
----------------------- ----------------------
Net asset value, end of period $ 8.06 $ 9.10
======================= ======================
TOTAL RETURN (11.50%) (8.97%)
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $ 180 $ 306
Ratio of net investment income to average net assets 2.03% 1.80%
Ratio of expenses to average net assets 0.85% 0.85%
Ratio of net investment loss to average net assets
before voluntary expense reimbursement (14.92%) (7.98%)
Ratio of expenses to average net assets before voluntary expense reimbursement 17.80% 10.63%
Portfolio turnover rate 36% 49%
</TABLE>
PERCENTAGE AMOUNTS ARE ANNUALIZED, EXCEPT TOTAL RETURN AND PORTFOLIO TURNOVER
RATE.
(a) Effective March 3, 2000, Touchstone Advisors, Inc. replaced Integrity
Capital Advisors, Inc. as Fund adviser.
5
<PAGE>
Select Ten Plus Portfolio - June
Schedule of Investments
June 30, 2000
Unaudited
<TABLE>
<CAPTION>
NUMBER
OF SHARES VALUE
-------------- ---------------
<S> <C> <C>
COMMON STOCKS (100%)
BASIC MATERIALS (20.0%)
Du Pont (E.I.) de Nemours and Company 368 $ 16,100
International Paper Company 565 16,844
---------------
32,944
CAPITAL GOODS (19.8%)
Caterpillar, Inc. 481 16,294
Minnesota Mining and Manufacturing Company 197 16,253
---------------
32,547
COMMUNICATION SERVICES (10.1%)
AT & T Corporation 524 16,571
CONSUMER CYCLICAL (19.8%)
Eastman Kodak Company 267 15,887
General Motors Corporation 286 16,600
---------------
32,487
CONSUMER STAPLE (20.9%)
Philip Morris Companies, Inc. 625 16,602
Proctor & Gamble Corporation 312 17,862
---------------
34,464
FINANCIAL (9.4%)
J.P. Morgan & Company, Inc. 140 15,417
---------------
TOTAL COMMON STOCKS (Cost $192,888) 164,430
---------------
TOTAL INVESTMENTS (100%) $ 164,430
===============
</TABLE>
OTHER INFORMATION:
Cost of purchases and proceeds from sales of securities, excluding
short-term securities, for the period ended June 30, 2000 aggregated $80,350
and $182,269, respectively. At June 30, 2000, net unrealized depreciation
for tax purposes aggregated $28,458 of which $1,115 related to appreciated
investments and $29,573 related to depreciated investments. The aggregate
cost of investments was the same for book and tax purposes.
SEE ACCOMPANYING NOTES.
6
<PAGE>
Select Ten Plus Portfolio - September
Statement of Assets and Liabilities
Unaudited
<TABLE>
<CAPTION>
JUNE 30, 2000
---------------------
<S> <C>
ASSETS
Investments in securities, at value (cost $375,800)--See accompanying schedule $ 300,105
Due from investment advisor 13,332
Receivable for investments sold 2,954
Dividends receivable 1,404
---------------------
TOTAL ASSETS 317,795
LIABILITIES
Cash overdraft 2,846
Accrued expenses 14,955
---------------------
TOTAL LIABILITIES 17,801
---------------------
NET ASSETS $ 299,994
=====================
Net assets consist of:
Paid-in capital $ 366,040
Undistributed net investment income 6,950
Accumulated net realized gain on investments 2,699
Net unrealized depreciation on investments (75,695)
---------------------
NET ASSETS $ 299,994
=====================
UNIT VALUE, offering and redemption price per unit $ 8.39
=====================
Units outstanding 35,760
=====================
</TABLE>
Statement of Operations
Unaudited
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
JUNE 30, 2000
----------------------
<S> <C>
INVESTMENT INCOME - DIVIDENDS $ 6,028
EXPENSES
Custody and accounting expenses 10,052
Directors' fees and expenses 3,116
Professional fees 2,493
Errors and omissions insurance 1,831
Printing and filing fees 1,643
Investment advisory and management fees 865
Other expenses 623
----------------------
Total expenses before reimbursement 20,623
Less: expense reimbursement (19,153)
----------------------
Net expenses 1,470
----------------------
Net investment income 4,558
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on investment securities 2,699
Net unrealized depreciation during the period on investments (48,202)
----------------------
Net realized and unrealized loss on investments (45,503)
----------------------
Net decrease in net assets resulting from operations $ (40,945)
======================
</TABLE>
SEE ACCOMPANYING NOTES.
7
<PAGE>
Select Ten Plus Portfolio - September
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
SIX MONTHS SEPTEMBER 30, 1999
ENDED (COMMENCEMENT OF
JUNE 30, 2000 OPERATIONS) THROUGH
(UNAUDITED) DECEMBER 31, 1999
--------------------- ----------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income $ 4,558 $ 2,392
Net realized gain on investments 2,699 --
Net unrealized depreciation during the period on investments (48,202) (27,493)
--------------------- ----------------------
Net decrease in net assets resulting from operations (40,945) (25,101)
Contract related transactions:
Contributions from contract holders (198 and 44,619 shares, respectively) 1,829 446,220
Cost of shares redeemed (8,761 and 296 shares, respectively) (79,173) (2,836)
--------------------- ----------------------
Net increase (decrease) in net assets resulting from share transactions (77,344) 443,384
--------------------- ----------------------
Total increase (decrease) in net assets (118,289) 418,283
NET ASSETS
Beginning of period 418,283 --
--------------------- ----------------------
End of period (including undistributed net investment income of $6,950 and
$2,392, respectively) $ 299,994 $ 418,283
===================== ======================
</TABLE>
SEE ACCOMPANYING NOTES.
Financial Highlights
<TABLE>
<CAPTION>
SIX MONTHS SEPTEMBER 30, 1999
ENDED (COMMENCEMENT OF
JUNE 30, 2000 OPERATIONS) THROUGH
(UNAUDITED) (a) DECEMBER 31, 1999
--------------------- ----------------------
<S> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 9.44 $ 10.00
Loss from investment operations:
Net investment income 0.03 0.05
Net realized and unrealized loss on investments (1.08) (0.61)
--------------------- ----------------------
Total from investment operations (1.05) (0.56)
--------------------- ----------------------
Net asset value, end of period $ 8.39 $ 9.44
===================== ======================
TOTAL RETURN (11.04%) (5.63%)
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $ 300 $ 418
Ratio of net investment income to average net assets 2.63% 2.18%
Ratio of expenses to average net assets 0.85% 0.85%
Ratio of net investment loss to average net assets before voluntary expense
reimbursements (8.44%) (6.68%)
Ratio of expenses to average net assets before voluntary expense reimbursement 11.92% 9.71%
Portfolio turnover rate --% --%
</TABLE>
PERCENTAGE AMOUNTS ARE ANNUALIZED, EXCEPT TOTAL RETURN AND PORTFOLIO TURNOVER
RATE.
(a) Effective March 3, 2000, Touchstone Advisors, Inc. replaced Integrity
Capital Advisors, Inc. as Fund adviser.
8
<PAGE>
Select Ten Plus Portfolio - September
Schedule of Investments
June 30, 2000
Unaudited
<TABLE>
<CAPTION>
NUMBER
OF SHARES VALUE
-------------- ---------------
<S> <C> <C>
COMMON STOCKS (100%)
BASIC MATERIALS (6.2%)
Du Pont (E.I.) de Nemours and Company 424 $ 18,550
CAPITAL GOODS (21.0%)
Caterpillar, Inc. 741 25,101
Minnesota Mining and Manufacturing Company 459 37,868
---------------
62,969
CONSUMER CYCLICAL (26.9% )
Eastman Kodak Company 591 35,165
General Motors Corporation 463 26,908
The Goodyear Tire & Rubber Company 927 18,540
---------------
80,613
CONSUMER STAPLE (22.2%)
Sears, Roebuck and Company 1,057 34,485
Philip Morris Companies, Inc. 1,216 32,300
---------------
66,785
ENERGY (13.2%)
Chevron Corporation 468 39,692
FINANCIAL (10.5%)
J.P. Morgan & Company, Inc. 286 31,496
---------------
TOTAL COMMON STOCKS (Cost $375,800) 300,105
===============
TOTAL INVESTMENTS (100%) $ 300,105
===============
</TABLE>
OTHER INFORMATION:
Cost of purchases of securities and proceeds from sales, excluding
short-term securities, for the period ended June 30, 2000 aggregated $798
and $68,940, respectively. At June 30, 2000, net unrealized depreciation for
tax purposes aggregated $75,695 of which $2,522 related to appreciated
investments and $78,217 related to depreciated investments. The aggregate
cost of investments was the same for book and tax purposes.
SEE ACCOMPANYING NOTES.
9
<PAGE>
Select Ten Plus Portfolio - December
Statement of Assets and Liabilities
Unaudited
<TABLE>
<CAPTION>
JUNE 30, 2000
---------------------
<S> <C>
ASSETS
Investments in securities, at value (cost $4,642)--See accompanying schedule $ 3,841
Receivable for investments sold 18,640
Due from investment advisor 3,259
Dividends receivable 41
---------------------
TOTAL ASSETS 25,781
LIABILITIES
Cash overdraft 3,139
Accrued expenses 9,937
---------------------
TOTAL LIABILITIES 13,076
NET ASSETS $ 12,705
=====================
Net assets consist of:
Paid-in capital $ 18,332
Undistributed net investment income 394
Accumulated net realized loss (5,220)
Net unrealized depreciation on investments (801)
---------------------
NET ASSETS $ 12,705
=====================
NET ASSET VALUE, offering and redemption price per share $ 9.35
=====================
Shares outstanding 1,359
=====================
</TABLE>
Statement of Operations
Unaudited
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
JUNE 30, 2000
-----------------------
<S> <C>
INVESTMENT INCOME - DIVIDENDS $ 573
EXPENSES
Custody and accounting expenses 10,025
Directors' fees and expenses 3,116
Professional fees 2,493
Errors and Omissions Insurance 1,745
Printing and filing fees 1,643
Investment advisory and management fees 105
Other expenses 708
-----------------------
Total expenses before reimbursement 19,835
Less: expense reimbursement (19,657)
-----------------------
Net expenses 178
-----------------------
Net investment income 395
REALIZED AND UNREALIZED LOSS ON INVESTMENTS
Net realized loss on investment securities (5,220)
Net unrealized depreciation during the period on investments (1,009)
-----------------------
Net realized and unrealized loss on investments (6,229)
-----------------------
Net decrease in net assets resulting from operations $ (5,834)
=======================
</TABLE>
SEE ACCOMPANYING NOTES.
10
<PAGE>
Select Ten Plus Portfolio - December
Statements of Changes in Net Assets
<TABLE>
<CAPTION>
FOR THE ONE DAY
SIX MONTHS PERIOD ENDED
ENDED DECEMBER 31, 1999
JUNE 30, 2000 (COMMENCEMENT OF
(UNAUDITED) OPERATIONS)
----------------- -------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income (loss) $ 395 $ (1)
Net realized gain (loss) on investments (5,220) --
Net unrealized appreciation (depreciation) during the period on investments (1,009) 208
----------------- -------------------
Net decrease in net assets resulting from operations (5,834) (207)
Contract related transactions:
Contributions from contract holders (190 shares and 6,208 shares, respectively) 1,814 62,086
Cost of shares redeemed (5,039 shares and 0 shares, respectively) (45,568) --
----------------- -------------------
Net increase (decrease) in net assets resulting from share transactions (43,754) 62,086
----------------- -------------------
Total increase (decrease) in net assets (49,588) 62,293
NET ASSETS
Beginning of period 62,293 --
----------------- -------------------
End of period (including undistributed net income of $394 and $1 of accumulated net
loss, respectively) $ 12,705 $ 62,293
================= ===================
</TABLE>
SEE ACCOMPANYING NOTES.
Financial Highlights
<TABLE>
<CAPTION>
FOR THE ONE DAY
SIX MONTHS PERIOD ENDED
ENDED DECEMBER 31, 1999
JUNE 30, 2000 (COMMENCEMENT OF
(UNAUDITED) (a) OPERATIONS)
-------------------- -------------------
<S> <C> <C>
SELECTED PER-SHARE DATA
Net asset value, beginning of period $ 10.03 $ 10.00
Income from investment operations:
Net investment income 0.29 --
Net realized and unrealized gain (loss) on investments (0.97) 0.03
-------------------- -------------------
Total from investment operations (0.68) 0.03
-------------------- -------------------
Net asset value, end of period $ 9.35 $ 10.03
==================== ===================
TOTAL RETURN (7.59%) 0.34%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands) $ 13 $ 62
Ratio of net investment income (loss) to average net assets 1.88% (0.50%)
Ratio of expenses to average net assets 0.85% 0.50%
Ratio of net investment loss to average net assets before voluntary expense
Reimbursements (91.72%) (54.50%)
Ratio of expenses to average net assets before voluntary expense reimbursement 94.45% 54.50%
Portfolio turnover rate 5% --%
</TABLE>
PERCENTAGE AMOUNTS ARE ANNUALIZED, EXCEPT TOTAL RETURN AND PORTFOLIO TURNOVER
RATE.
(a) Effective March 3, 2000, Touchstone Advisors, Inc. replaced Integrity
Capital Advisors, Inc. as Fund adviser.
11
<PAGE>
Select Ten Plus Portfolio - December
Schedule of Investments
June 30, 2000
Unaudited
<TABLE>
<CAPTION>
NUMBER
OF SHARES VALUE
-------------- ------------------
<S> <C> <C>
COMMON STOCKS (100%)
BASIC MATERIALS (31.4%)
Du Pont (E.I.) de Nemours and Company 12 $ 525
Exxon Mobil Corporation 6 470
International Paper Company 7 210
------------------
1,205
CAPITAL GOODS (18.2%)
Caterpillar, Inc. 6 203
Minnesota Mining and Manufacturing Company 6 495
------------------
698
COMMUNICATIONS SERVICES (7.9%)
SBC Communications, Inc. 7 303
CONSUMER CYCLICAL (19.9%)
Eastman Kodak Company 7 417
General Motors Corporation 6 352
------------------
769
CONSUMER STAPLE (11.1% )
Philip Morris Companies, Inc. 16 425
FINANCIAL (11.5%)
J.P. Morgan & Company, Inc. 4 441
------------------
TOTAL COMMON STOCKS (Cost $4,642) 3,841
------------------
TOTAL INVESTMENTS (100%) $ 3,841
==================
</TABLE>
OTHER INFORMATION:
Cost of purchases of securities and proceeds of sales, excluding short-term
securities, for the period ended June 30, 2000 aggregated $120 and $49,352,
respectively. At June 30, 2000, net unrealized appreciation for tax purposes
aggregated $801 of which $49 related to appreciated investments and $850
related to depreciated investments. The aggregate cost of investments was
the same for book and tax purposes.
SEE ACCOMPANYING NOTES.
12
<PAGE>
Select Ten Plus Fund, LLC
Notes to Financial Statements
June 30, 2000
Unaudited
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
ORGANIZATION
Select Ten Plus Fund, LLC (the "Fund") was formed as of September 30, 1998.
The Fund is registered under the Investment Company Act of 1940 as a
non-diversified, open-end management investment company. Contributions to the
Fund are presently limited to PINNACLE contractholders. PINNACLE is a
flexible premium variable annuity issued by National Integrity Life Insurance
Company ("National Integrity"). National Integrity is a wholly-owned
subsidiary of Integrity Life Insurance Company ("Integrity"). The Fund is
currently divided into four portfolios: Select Ten Plus Portfolio-March,
Select Ten Plus Portfolio-June, Select Ten Plus Portfolio-September, and
Select Ten Plus Portfolio-December (the "Portfolio(s)"). Each Portfolio is a
non-diversified investment company invests directly in securities. The
Portfolios seek total return by acquiring the ten highest yielding stocks in
the Dow Jones Industrial Average in equal weights and holding them for
approximately twelve months.
Touchstone Securities Corporation ("Touchstone Securities"), a registered
broker-dealer under the Securities Exchange Act of 1934 and a member of the
National Association of Securities Dealers, Inc., distributes units of the Fund.
Touchstone Advisors, Inc. ("Touchstone Advisors"), an investment adviser
registered under the Investment Advisers Act of 1940, provides management
services to the Fund pursuant to a management agreement. National Asset
Management Corporation ("National Asset"), an investment adviser registered
under the Investment Advisers Act of 1940, serves as the sub-adviser to the Fund
pursuant to a sub-advisory agreement.
Western and Southern Life Insurance Company ("W&S") is the ultimate parent of
National Integrity and Integrity, Touchstone Advisors and Touchstone
Securities. ARM Financial Group, Inc. ("ARM") was the parent of Integrity and
National Integrity prior to March 3, 2000. In addition, prior to March 3,
2000, ARM Securities Corporation and Integrity Capital Advisors, Inc. were
the principal underwriter and investment adviser to the Fund, respectively.
(See Note 3)
13
<PAGE>
Select Ten Plus Fund, LLC
Notes to Financial Statements (continued)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
BASIS OF PRESENTATION
The accompanying financial statements have been prepared in accordance with
accounting principles generally accepted in the United States.
SECURITY VALUATION
Common stocks are valued at the last sale price on the exchange on which they
are primarily traded.
SECURITY TRANSACTIONS
Securities transactions are accounted for as of trade date net of brokerage
fees, commissions and transfer fees. Interest income is accrued daily. Dividend
income is recorded on the ex-dividend date. Realized gains and losses on sales
of investments are determined on the basis of the first-in, first-out method for
all of the Portfolios.
FEDERAL INCOME TAX MATTERS
The Fund is a limited liability company with all its interests owned by National
Integrity. Accordingly, the Fund is taxed as part of the operations of National
Integrity and is not taxed separately.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the amounts reported in the financial statements and
accompanying notes. Actual results could differ from those estimates.
2. INVESTMENT ADVISORY AGREEMENTS AND PAYMENTS TO RELATED PARTIES
Touchstone Advisors, the Fund's investment adviser since March 3, 2000, has
entered into a sub-advisory agreement with a registered sub-adviser for each of
the Portfolios. National Asset serves as the sub-adviser to each of the
Portfolios. For providing investment management services to the Portfolios,
Touchstone Advisors receives a monthly fee based on an annual rate of .50% of
each Portfolio's average daily net assets. Touchstone Advisors, not the Fund,
pays sub-
14
<PAGE>
Select Ten Plus Fund, LLC
Notes to Financial Statements (continued)
2. INVESTMENT ADVISORY AGREEMENTS AND PAYMENTS TO RELATED PARTIES (CONTINUED)
advisory fees to National Asset based on the combined average daily net assets
of the Portfolios and the Divisions that comprise Separate Account Ten of
Integrity Life Insurance Company (collectively, the "net asset base"). Fees
under the sub-advisory agreement are paid at an annual rate of .10% of the net
asset base up to $100 million and .05% of the net asset base in excess of $100
million. Touchstone Advisors has agreed to reimburse each Portfolio for
operating expenses (excluding management fees) above an annual rate of 0.35% of
the Portfolios' average net assets.
Certain officers and directors of the Fund are also officers of Touchstone
Securities, Touchstone Advisors, Integrity, and National Integrity. The Fund
does not pay any amounts to compensate these individuals.
3. EVENTS RELATING TO ARM, INTEGRITY AND NATIONAL INTEGRITY
On July 29, 1999, ARM announced that it was restructuring its institutional
business and positioning its retail business and technology operations for the
sale of ARM or its businesses or its assets. On December 17, 1999 ARM announced
that it had entered into a purchase agreement whereby W&S would acquire ARM's
insurance subsidiaries, Integrity and National Integrity. The transaction closed
on March 3, 2000. ARM Securities Corporation and Integrity Capital Advisors
ceased to be affiliated with Integrity and National Integrity subsequent to
March 3, 2000 when the acquisition by W&S was complete. In conjunction with the
acquisition, Touchstone Securities became the principal underwriter of variable
annuities for both Integrity and National Integrity and Touchstone Advisors
became the investment adviser for the Fund.
W&S is part of the Western-Southern Enterprise, a financial services group which
also includes Western-Southern Life Assurance Company, Columbus Life Insurance
Company, Touchstone Advisors, Inc., Touchstones Securities, Inc., Fort
Washington Investment Advisors, Inc., Todd Investment Advisors, Inc.,
Countrywide Financial Services, Capital Analysts Incorporated and Eagle Realty
Group, Inc. Assets owned or under management by the group exceed $20 billion.
Western and Southern is rated A++ (Superior) by A.M. Best, AAA (Highest) by Duff
& Phelps, AAA (Extremely Strong) by Standard & Poor's, and Aa2 (Excellent) by
Moody's.
4. SHAREHOLDER MEETINGS
A Special Meeting of Shareholders of the June, September and December
Portfolios was held on April 4, 2000. Each matter voted upon at that meeting,
as well as the number of votes cast for,
15
<PAGE>
Select Ten Plus Fund, LLC
Notes to Financial Statements (continued)
4. SHAREHOLDER MEETINGS (CONTINUED)
against or withheld, the number of abstentions, and the number of broker
non-votes with respect to such matters. Abstentions have the effect of a
negative vote on a proposal. The results are set forth below:
1. (a) June Portfolio Shareholders approved a new investment management
agreement the ("New Management Agreement") between the Fund and
Touchstone Advisors.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
26,727.894 - 3,363.291 -
</TABLE>
(b) September Portfolio Shareholders approved the New Management
Agreement between the Fund and Touchstone Advisors.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
39,263.647 - 465.627 -
</TABLE>
(c) December Portfolio Shareholders approved the New Management
Agreement between the Fund and Touchstone Advisors.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
6,009.163 - - -
</TABLE>
2. (a) June Portfolio Shareholders approved a new sub-advisory agreement
between National Asset and Touchstone Advisors.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
27,727.894 - 3,363.291 -
</TABLE>
16
<PAGE>
Select Ten Plus Fund, LLC
Notes to Financial Statements (continued)
4. SHAREHOLDER MEETINGS (CONTINUED)
(b) September Portfolio Shareholders approved a new sub-advisory
agreement between National Asset and Touchstone Advisors.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
39,263.647 - 465.627 -
</TABLE>
(c) December Portfolio Shareholders approved a new sub-advisory between
agreement National Asset and Touchstone Advisors.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
6,009.163 - - -
</TABLE>
3. (a) June Portfolio Shareholders elected John R. Lindholm to the Fund's
Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
31,091.185 - - -
</TABLE>
(b) September Portfolio Shareholders elected John R. Lindholm to the
Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
39,729.274 - - -
</TABLE>
(c) December Portfolio Shareholders elected John R. Lindholm to the
Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
6,009.163 - - -
</TABLE>
17
<PAGE>
Select Ten Plus Fund, LLC
Notes to Financial Statements (continued)
4. SHAREHOLDER MEETINGS (CONTINUED)
4. (a) June Portfolio Shareholders elected Chris LaVictoire Mahai to the
Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
31,091.185 - - -
</TABLE>
(b) September Portfolio Shareholders elected Chris LaVictoire Mahai to
the Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
39,729.274 - - -
</TABLE>
(c) December Portfolio Shareholders elected Chris LaVictoire Mahai to
the Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
6,009.163 - - -
</TABLE>
5. (a) June Portfolio Shareholders elected William B. Faulkner to the
Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
31,091.185 - - -
</TABLE>
(b) September Portfolio Shareholders elected William B. Faulkner to the
Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
39,729.274 - - -
</TABLE>
18
<PAGE>
Select Ten Plus Fund, LLC
Notes to Financial Statements (continued)
4. SHAREHOLDER MEETINGS (CONTINUED)
(c) December Portfolio Shareholders elected William B. Faulkner to the
Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
6,009.163 - - -
</TABLE>
6. (a) June Portfolio Shareholders elected John Katz to the Fund's Board of
Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
31,091.185 - - -
</TABLE>
(b) September Portfolio Shareholders elected John Katz to the Fund's
Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
39,729.274 - - -
</TABLE>
(c) December Portfolio Shareholders elected John Katz to the Fund's
Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
6,009.163 - - -
</TABLE>
7. (a) June Portfolio Shareholders elected Irvin W. Quesenberry, Jr. to the
Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
31,091.185 - - -
</TABLE>
19
<PAGE>
Select Ten Plus Fund, LLC
Notes to Financial Statements (continued)
4. SHAREHOLDER MEETINGS (CONTINUED)
(b) September Portfolio Shareholders elected Irvin W. Quesenberry, Jr.
to the Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
39,729.274 - - -
</TABLE>
(c) December Portfolio Shareholders elected Irvin W. Quesenberry, Jr. to
the Fund's Board of Managers.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
6,009.163 - - -
</TABLE>
8. (a) June Portfolio Shareholders ratified the selection of Ernst & Young
LLP as the Fund's independent accountants for the fiscal year ending
December 31, 2000.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
27,727.894 - 3,363.291 -
</TABLE>
(b) September Portfolio Shareholders ratified the selection of Ernst &
Young LLP as the Fund's independent accountants for the fiscal year
ending December 31, 2000.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
39,587.838 - 141.436 -
</TABLE>
(c) December Portfolio Shareholders ratified the selection of Ernst &
Young LLP as the Fund's independent accountants for the fiscal year
ending December 31, 2000.
<TABLE>
<CAPTION>
Shares Shares Broker
Voted "For" Voted "Against" Abstentions Non-Votes
------------------------- --------------------- -------------------- ----------------------
<S> <C> <C> <C>
6,009.163 - - -
</TABLE>
20
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