[OUTSIDE FRONT COVER]
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semi-annual report
LIQUIDITY PLUS MONEY MARKET FUND
June 30, 1997
<PAGE>
[INSIDE FRONT COVER]
Letter to shareholders
"...We hope to provide....a vehicle through which they can efficiently offer
cash management and cash sweep services."
DEAR SHAREHOLDERS:
We would like to welcome you to the Liquidity Plus Money Market Fund.
This Fund has been designed specifically for you at the request of Comerica
Securities. Through our management of this Fund, we hope to provide Comerica
Securities a vehicle through which they can efficiently offer cash
management and cash sweep services. We are excited about this opportunity to
serve you through Comerica Securities and hope that you will find our efforts
to be of value.
The Fund began operation in mid-June 1997. We expect that over the next
several months the Fund will continue to grow as Comerica Securities'
customers receive information regarding the Fund and begin to utilize the
range of services being offered.
If you have any questions about the Fund please call us at 1-800-438-5789
or your Comerica Securities representative.
Very truly yours,
/s/Lee Munder
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Lee Munder President
<PAGE>
St. Clair Funds, Inc.
Liquidity Plus Money Market Fund
Portfolio of Investments, June 30, 1997 (Unaudited)
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<TABLE>
<CAPTION>
Principal
Amount Value
- ---------- -----
<S> <C> <C>
U.S. TREASURY NOTE - 93.1% (Cost $990,365)
$990,000 5.625% due 08/31/1997 $ 990,365
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REPURCHASE AGREEMENT - 3.9% (Cost $41,455)
41,455 Agreement with Lehman Brothers Inc.,
5.920% dated 06/30/1997 to be repurchased at
$41,462 on 07/01/1997, collateralized by
$45,000 U.S. Treasury Note, 8.750%,
due 10/15/1997 (value $46,225) 41,455
-----------
<S> <C> <C>
TOTAL INVESTMENTS (Cost $1,031,820*) 97.0% 1,031,820
OTHER ASSETS AND LIABILITIES (Net) 3.0 32,343
----- -----------
NET ASSETS 100.0% $ 1,064,163
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<FN>
* Aggregate cost for Federal tax purposes.
See Notes to Financial Statements.
</TABLE>
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<PAGE>
Liquidity Plus Money Market Fund
Statement of Assets and Liabilities, June 30, 1997 (Unaudited)
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<TABLE>
<S> <C>
ASSETS:
Investments, at value (Cost $1,031,820)
See accompanying schedule:
Securities .................................................. $ 990,365
Repurchase agreement ........................................ 41,455
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Total investments ................................................. 1,031,820
Cash .............................................................. 23
Interest receivable ............................................... 18,620
Receivable from investment advisor ................................ 851
Unamortized organization costs .................................... 13,867
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Total Assets ................................................... 1,065,181
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LIABILITIES:
Legal and audit fees payable ...................................... 589
Custodian fees payable ............................................ 15
Distribution and shareholder servicing fees payable ............... 148
Investment advisory fee payable ................................... 148
Administration fee payable ........................................ 48
Transfer agent fee payable ........................................ 18
Accrued Directors' fees and expenses .............................. 2
Accrued expenses and other payables ............................... 50
Total Liabilities .............................................. 1,018
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NET ASSETS ........................................................ $1,064,163
==========
NET ASSET VALUE offering and redemption price per share
($1,064,163 / 1,064,163 shares of common stock outstanding) .... $ 1.00
==========
<FN>
See Notes to Financial Statements.
</TABLE>
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<PAGE>
Liquidity Plus Money Market Fund
Statement of Operations, Period Ended June 30, 1997 (a) (Unaudited)
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<TABLE>
<S> <C>
INVESTMENT INCOME:
Interest ........................................................ $ 2,213
-------
Total investment income ...................................... 2,213
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EXPENSES:
Legal and audit fees ............................................ 589
Amortization of organizational costs ............................ 235
Investment advisory fee ......................................... 148
Distribution and shareholder servicing fees ..................... 148
Administration fee .............................................. 48
Transfer agent fee .............................................. 18
Custodian fees .................................................. 15
Directors' fees and expenses .................................... 2
Other............................................................ 50
Total Expenses ............................................... 1,253
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Expenses reimbursed by investment advisor ....................... (851)
Net Expenses................................................. 402
NET INVESTMENT INCOME ........................................... 1,811
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NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ............ $ 1,811
=======
<FN>
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(a) Liquidity Plus Money Market commenced operations on June 4, 1997.
See Notes to Financial Statements.
</TABLE>
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<PAGE>
Liquidity Plus Money Market Fund
Statement of Changes in Net Assets
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<TABLE>
<CAPTION>
Period
Ended
6/30/97 (a)
(Unaudited)
-------------
<S> <C>
Net investment income ......................................... $ 1,811
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Net increase in net assets resulting from operations .......... 1,811
Distributions to shareholders from net investment income ...... (1,811)
Net increase in net assets from Fund share transactions ....... 1,064,163
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Net increase in net assets .................................... 1,064,163
NET ASSETS:
Beginning of period............................................ 0
End of period ................................................. $ 1,064,163
===========
<FN>
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(a) Liquidity Plus Money Market commenced operations on June 4, 1997.
See Notes to Financial Statements.
</TABLE>
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<PAGE>
Liquidity Plus Money Market Fund
Financial Highlights, For a Share Outstanding Throughout The Period
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<TABLE>
<CAPTION>
Period
Ended
6/30/97 (a)
(Unaudited)
------------
<S> <C>
Net asset value, beginning of period............................. $ 1.00
--------
Income from investment operations:
Net investment income............................................ 0.0032
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Total from investment operations................................. 0.0032
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Less distributions:
Distributions from net investment income......................... (0.0032)
--------
Total distributions.............................................. (0.0032)
--------
Net asset value, end of period................................... $ 1.00
========
Total return (b)................................................. 0.32%
========
Ratios to average net assets/supplemental data:
Net assets, end of period (in 000's)............................. $ 1,064
Ratio of operating expenses to average net assets................ 0.95% (c)
Ratio of net investment income to average net assets............. 4.28% (c)
Ratio of operating expenses to average net assets
without expenses reimbursed................................... 2.96% (c)
<FN>
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(a) Liquidity Plus Money Market Fund commenced operations on June 4, 1997.
(b) Total return represents aggregate total return for the period indicated.
(c) Annualized.
</TABLE>
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<PAGE>
Liquidity Plus Money Market Fund
Notes To Financial Statements, June 30, 1997 (Unaudited)
1. Organization and Significant Accounting Policies
Liquidity Plus Money Market Fund (the "Fund") is a diversified portfolio
of St. Clair Funds, Inc. (the "Company") which is registered under the
Investment Company Act of 1940, as amended (the "1940 Act"), as an open-end
investment company. The Company was organized as a Maryland corporation on
May 23, 1984 under the name St. Clair Money Market Fund, Inc., which was
changed to St. Clair Fixed Income Fund, Inc. on December 30, 1986 and to St.
Clair Funds, Inc. on September 18, 1996. The Fund commenced operations on
June 4, 1997.
The preparation of financial statements in accordance with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of increases and
decreases in net assets from operations during the reporting period. Actual
results could differ from those estimates. The following is a summary of
significant accounting policies followed by the Fund in the preparation of
its financial statements:
Security Valuation: Securities are valued on an amortized cost basis,
which approximates current market value. Under this method, securities are
valued initially at cost when purchased. Thereafter, a constant proportionate
amortization of any discount or premium is recorded until maturity of the
security. Regular review and monitoring of the valuation of securities held
by the Fund is performed pursuant to procedures established by the Board of
Directors. The Fund seeks to maintain a net asset value per share of $1.00.
Repurchase Agreements: The Fund may engage in repurchase agreement
transactions. Under the terms of a typical repurchase agreement, the Fund
takes possession of an underlying debt obligation subject to an obligation of
the seller to repurchase, and the Fund to resell, the obligation at an
agreed-upon price and time, thereby determining the yield during the Fund's
holding period. This arrangement results in a fixed rate of return that is
not subject to market fluctuations during the Fund's holding period. The
value of the collateral is at least equal, at all times, to the total amount
of the repurchase obligations, including interest. In the event of
counterparty default, the Fund has the right to use the collateral to satisfy
the terms of the repurchase agreement. However, there could be potential loss
to the Fund in the event the Fund is delayed or prevented from exercising its
right to dispose of the collateral securities, including the risk of a
possible decline in the value of the collateral securities during the period
while the Fund seeks to assert its rights. The Fund's Advisor, acting under
the supervision of the Board of Directors, reviews the value of the
collateral and the creditworthiness of those banks and dealers with which the
Fund enters into repurchase agreements to evaluate potential risks.
Security Transactions and Investment Income: Security transactions are
recorded on the trade date. The cost of investments sold is determined by use
of the specific identification method for both financial reporting and income
tax purposes. Interest income is recorded on the accrual basis.
Dividends and Distributions to Shareholders: Dividends from net
investment income are declared daily and paid monthly. Capital gains
distributions, if any, will be made at least annually.
Distributions to shareholders are recorded on the ex-dividend date.
Income dividends and capital gain distributions are determined in
accordance with income tax regulations which may differ from generally
accepted accounting principles. These differences are primarily due to
differing treatments of income and gains on various investment securities
held by the Fund, timing differences and differing characterization of
distributions made by the Fund as a whole.
Federal Income Taxes: The Fund intends to continue to qualify as a
regulated investment company by complying with the requirements of the
Internal Revenue Code of 1986, as amended, applicable to regulated
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<PAGE>
investment companies and to distribute substantially all of its earnings to
its shareholders. Therefore, no Federal income or excise tax provision is
required.
2. Investment Advisor, Administrator, Custodian, Transfer Agent and Other
Related Party Transactions
Munder Capital Management (the "Advisor"), an independent investment
management firm, serves as the Fund's investment advisor. For its advisory
services, the Advisor is entitled to receive a fee, computed daily and
payable monthly, at an annual rate of 0.35% of the value of its average daily
net assets.
The Advisor has reimbursed certain expenses, payable by the Fund, for
the period ended June 30, 1997, as reflected in the Statement of Operations.
First Data Investor Services Group, Inc. ("Investor Services Group")
(the "Administrator"), serves as the Fund's administrator and assists in all
aspects of its administration and operations. Investor Services Group also
serves as the Fund's transfer agent and dividend disbursing agent ("Transfer
Agent").
As compensation for its services, the Administrator and Transfer Agent
are entitled to receive a fee, based on the aggregate average daily net
assets of the Fund and certain other investment portfolios that are advised
by the Advisor and for which Investor Services Group provides services,
computed daily and payable monthly, at an annual rate of 0.12% of the first
$2.8 billion of net assets, plus 0.105% of the next $2.2 billion of net
assets, plus 0.10% of all net assets in excess of $5 billion (with a $1.2
million minimum fee per annum in the aggregate for all portfolios with
respect to the Administrator); and 0.02% of the first $2.8 billion of net
assets, plus 0.015% of the next $2.2 billion of net assets, plus 0.01% of net
assets in excess of $5 billion with respect to the Transfer Agent. The
Transfer Agent and Administrator are also entitled to reimbursement for
out-of-pocket expenses. The Administrator has entered into a
Sub-Administration Agreement with Funds Distributor, Inc. ("FDI" or the
"Distributor") under which FDI provides certain administrative services with
respect to the Fund. The Administrator pays FDI a fee for these services out
of its own resources at no additional cost to the Fund.
Comerica Bank ("Comerica") provides custodial services to the Fund. As
compensation for its services, Comerica is entitled to receive fees, based on
the aggregate average daily net assets of the Fund and certain other
investment portfolios advised by the Advisor for which Comerica provides
services, computed daily and payable monthly at an annual rate of 0.03% of
the first $100 million of average daily net assets, plus 0.02% of the next
$500 million of net assets, and 0.01% of net assets in excess of $600
million. Comerica also receives certain transaction based fees.
Each Director of the Company is paid an aggregate fee, consisting of a
$20,000 annual retainer, for services in such capacity plus $1,500 for each
meeting attended per year, plus out-of-pocket expenses incurred as a Board
member for services provided as a Board member of the Company, The Munder
Funds Trust, The Munder Funds, Inc., and Munder Framlington Funds Trust. The
Trustees or Directors are also reimbursed for any expenses incurred by them
in connection with their duties as Trustees or Directors. No officer,
director or employee of the Advisor, Comerica, FDI or Investor Services Group
currently receives any compensation from the Company.
3. Distribution and Service Plan
The Fund has adopted a Distribution and Service Plan (the "Plan")
pursuant to Rule 12b-1, adopted by the Securities and Exchange Commission
under the 1940 Act. Under the Plan, the Distributor is paid a service fee at
an annual rate of 0.25% of the value of the average daily net assets of the
Fund. The Distributor uses the service fees
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<PAGE>
primarily to pay ongoing trail commissions to securities dealers and other
financial institutions and organizations (collectively, the Service
Organization") who provide shareholder services for the Fund. The Plan also
permits payments to be made by the Fund to the Distributor for expenditures
incurred by the Distributor in connection with the distribution of Fund
shares to investors and provision of certain shareholder services (which
include but are not limited to the payment of compensation, including
compensation to Service Organizations to obtain various distribution related
services for the Fund). The Distributor is also paid a distribution fee at an
annual rate of 0.10% of the value of the average daily net assets of the
Fund.
4. Common Stock
At June 30,1997, two billion shares of $.001 par value common stock were
authorized for the Fund.
Since the Fund has sold, issued as reinvestment of dividends and
redeemed shares only at a constant net asset value of $1.00 per share, the
number of shares represented by such sales, reinvestments, and redemptions is
the same as the amounts shown below for such transactions.
Changes in common stock for the Fund were as follows:
<TABLE>
<CAPTION>
Period Ended
6/30/97
Amount
------------
<S> <C>
Sold $ 1,107,100
Issued as reinvestment of dividends 1,810
Redeemed (44,747)
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Net increase $ 1,064,163
===========
</TABLE>
5. Organizational Costs
Expenses incurred in connection with the organization of the Fund,
including the fees and expenses of registering and qualifying its shares for
distribution under Federal securities regulations, are being amortized on a
straight-line basis over a period of 5 years from commencement of operations.
<PAGE>
[INSIDE BACK COVER]
BOARD OF DIRECTORS
Charles W. Elliott, Chairman
John Rakolta, Jr., Vice Chairman
Thomas B. Bender
David J. Brophy
Joseph E. Champagne
Thomas D. Eckert
OFFICERS
Lee Munder, President
Leonard J. Barr II, Vice President
Elyse G. Essick, Vice President
Terry H. Gardner, Vice President, CFO and Treasurer
Ann F. Putallaz, Vice President
James C. Robinson, Vice President
Gerald L. Seizert, Vice President
Paul D. Tobias, Vice President
Richard H. Rose, Assistant Treasurer
Lisa Anne Rosen, Secretary and Assistant Treasurer
Teresa M.R. Hamlin, Assistant Secretary
Julie A. Tedesco, Assistant Secretary
INVESTMENT ADVISOR
Munder Captial Management
Munder Capital Center
480 Pierce Street
Birmingham, MI 48009
ADMINISTRATOR AND TRANSFER AGENT
First Data Investor Services Group, Inc.
53 State Street
Boston, MA 02109
DISTRIBUTOR
Funds Distributor, Inc.
60 State Street
Boston, MA 02109
CUSTODIAN
Comerica Bank
411 West Lafayette
Detroit, MI 48226
LEGAL COUNSEL
Dechert Price & Rhoads
1500 K Street, N.W. Suite 500
Washington, D.C. 20005
INDEPENDENT AUDITORS
Ernst & Young, LLP
200 Clarendon Street
Boston, MA 02116
<PAGE>
[OUTSIDE BACK COVER]
STCLSAN697 / F001cstc
Investment Advisor: Munder Capital Management
Distributd by: Funds Distributor, Inc.
<PAGE>
